Constantine v Blacktown City Council (No 2)

[2016] NSWLEC 81

Land and Environment Court

New South Wales

Medium Neutral Citation:	Constantine v Blacktown City Council (No 2) [2016] NSWLEC 81
Hearing dates:	11, 12, 13 and 14 April 2016
Decision date:	06 July 2016
Jurisdiction:	Class 3
Before:	Moore J
Decision:	See [166] to [172]. SMO to be provided by 27 July 2016 to reflect the decision.
Catchwords:	COMPULSORY ACQUISITION – underlying zonings absent the public purpose – position agreed for portion of the acquired land – approach to be taken when little difference between valuers – position more beneficial to disposed owner adopted COMPULSORY ACQUISITION – underlying zonings absent the public purpose – whether process for consideration of ecological issues related to the public purpose – ecological issues considered in broader planning context separate from public purpose – conservation zoning appropriate absent the public purpose COMPULSORY ACQUISITION – possibility of land with underlying conservation zoning being up-zoned to permit development (absent the public purpose) – no realistic prospect of up-zoning – compensation for portion of the land with an underlying conservation zoning to be determined solely on that basis COMPULSORY ACQUISITION – claim for disturbance – claim partially disputed – two elements disallowed but remainder allowed – claimed items must relate to the present acquisition process not pre-acquisition negotiations – claimed items must relate to the present actual use of the land not some possible future use of the land
Legislation Cited:	Threatened Species Conservation Act 1995 Land Acquisition (Just Terms Compensation) Act 1991 Environmental Planning and Assessment Act 1979 State Environmental Planning Policy (Sydney Region Growth Centres) 2006
Cases Cited:	Adams v Valuer General [2014] NSWLEC1005 Constantine v Blacktown City Council [2016] NSWLEC 56 Fitzpatrick Investments Pty Limited v Blacktown City Council (No. 2) [2000] NSWLEC 139; 108 LGERA 417 Maloney v Minister Administering the Environmental Planning & Assessment Act 1979 [2011] NSWLEC 121 Mir Bros Unit Constructions Pty Ltd v Roads & Traffic Authority of New South Wales [2006] NSWCA 314 Sydney Water Corporation v Caruso and Ors [2009] NSWCA 391; 170 LGERA 298
Category:	Principal judgment
Parties:	Mario Constantine (Applicant) Blacktown City Council (Respondent)
Representation:	Counsel: Mr I Hemmings SC/Mr S Nash, barrister (Applicant) Mr A Galasso SC (Respondent)   Solicitors: Project Lawyers (Applicant) Ritchie & Castellan (Respondent)
File Number(s):	150751 of 2016 (formerly 30549 of 2015)
Publication restriction:	No

TABLE OF CONTENTS

Introduction

The statutory framework

The site

The public purpose

The site inspection

The amendment application

The evidence at the hearing

The town planning evidence

The underlying zoning of the western area

Biocertification

The assessment of the blue-hatched areas

A Schedule 3 assessment of the western area of Mr Constantine’s land

The conservation area “surplus”

Conclusion on underlying zoning of western area

The potential for “up-zoning” to R2

The ecological evidence relevant to up-zoning

Conclusion on up-zoning

The valuation evidence generally

The valuers

Mr Phippen’s evidence on behalf of the Applicant

Mr Good’s evidence on behalf of the Respondent

Summary of the final position of the valuers

Conclusion on R2 values

The value of the E2 land

Conclusion on valuation outcomes

The contested “disturbance” claim

Conclusion

Judgment

Introduction

1. Mr Constantine has had his property, one of a little over 8.5 hectares, compulsorily acquired as part of the planning process for development of the Marsden Park Precinct on Sydney's north-western outskirts. The acquired land has, as its street address, 51 Glengarrie Road, Marsden Park (the site). A more complete description of the site appears later in this decision.

2. Mr Constantine is dissatisfied with the value determined to be the appropriate compensation for the acquisition of his land and has, therefore, commenced these proceedings to establish what is the appropriate compensation to be paid to him for the acquisition of the site.

The statutory framework

3. There are two elements to the statutory framework that are engaged in my consideration of the value of the land acquired from Mr Constantine. The first is the legislation that sets up the compensatory regime for such acquisitions, whilst the second is the planning framework within which a proper assessment of the value of the land can be made.

4. The first element, the acquisition process, is governed relevantly by the provisions of the Land Acquisition (Just Terms Compensation) Act 1991 (the Land Acquisition Act). Two provisions of this legislation require my consideration in these proceedings. The first, and primary, of these is s 56 of the Land Acquisition Act, the provision that establishes the framework within which the market value for the land is to be determined. This provision is in the following terms:

56 Market value

(1) In this Act:

"market value" of land at any time means the amount that would have been paid for the land if it had been sold at that time by a willing but not anxious seller to a willing but not anxious buyer, disregarding (for the purpose of determining the amount that would have been paid):

(a) any increase or decrease in the value of the land caused by the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired, and

(b) any increase in the value of the land caused by the carrying out by the authority of the State, before the land is acquired, of improvements for the public purpose for which the land is to be acquired, and

(c) any increase in the value of the land caused by its use in a manner or for a purpose contrary to law.

(2) When assessing the market value of land for the purpose of paying compensation to a number of former owners of the land, the sum of the market values of each interest in the land must not (except with the approval of the Minister responsible for the authority of the State) exceed the market value of the land at the date of acquisition.

5. It is the initial portion of this section that establishes what is referred to as the “statutory disregard”. The statutory disregard requires me to set aside the public purpose for which the land has been acquired by the relevant public-acquiring body, in this case, Blacktown City Council (the Council).

6. The primary task in giving proper effect to the statutory disregard, in this instance, is to set aside the zoning that has come into being as a consequence of the acquisition, and to understand what is the relevant underlying zoning for valuation purposes. The contest concerning the underlying zoning for this land is only partially in dispute, as later dealt with in my consideration of the town planning evidence.

7. The second element, that which sets up the planning framework that encompasses the site (including the zoning post acquisition that effects the public purpose for which Mr Constantine’s land was acquired), has its genesis in an instrument made under the Environmental Planning and Assessment Act 1979 (the EP&A Act) and the State Environmental Planning Policy (Sydney Region Growth Centres) 2006 (the Growth Centres SEPP). The Growth Centres SEPP came into effect on 28 July 2006. The Growth Centres SEPP is a framework document setting out broad planning parameters for a wide range of new urban release areas spread across an arc from the south‑west to the north-west of the outer fringes of the Sydney metropolitan area. Within this broad planning framework, there are set zones and relevant controls in a Land Use Table applicable to the areas encompassed by the policy.

8. The Growth Centres SEPP sets out, in cl 2, its aims. These aims are expressed as being at a level of generality consistent with the extent of its geographic application.

9. The Growth Centres SEPP makes provision for an ongoing fine-grained planning process for individual precincts identified in it. This is achieved by the development of precinct plans (and addition, over time, of these as appendices to the SEPP) dealing with those individual precincts.

10. The precinct within which the land acquired from Mr Constantine is located is known as the Marsden Park Precinct and its fine-grained planning is contained in Appendix 12 to the Growth Centres SEPP (Appendix 12). Appendix 12 came into effect on 4 October 2014.

11. Immediately to the south-east of the Marsden Park Precinct is a precinct for which the fine-grained planning had earlier been finalised; a precinct known as the Marsden Park Industrial Precinct. The fine-grained planning of this precinct, as depicted on various maps in the evidence in these proceedings, also requires consideration in my determination of what should be regarded as the underlying zoning for valuation purposes of the portion of the land acquired from Mr Constantine.

12. A second provision of the Land Acquisition Act, of greater specificity, also requires consideration in these proceedings. That provision is s 59, the section that deals with compensation to an owner of acquired land for what is described as “disturbance”. The application of that provision to the specific elements claimed under the heading “Disturbance” is dealt with in a separate section of this decision, after my consideration of the general valuation issues.

The site

13. The site comprises Lots 1, 2 and 3 in DP 1202472. The property is positioned on the western side of Glengarrie Road at its cul-de-sac end and is approximately 400 metres north from the intersection with South Street. The property is, in approximate terms, trapezoidal in shape and has a street frontage of 288 metres, side boundaries running east-to-west measuring 317 metres (northern boundary), 336 metres (southern boundary), and a western boundary of 335 metres which borders Lot 5 in DP 1078187. The total area of the acquired land is 8.6573 hectares.

14. The site is generally separated into three segments, identified as the Western Area which contains Part Lot 1 and Part Lot 2, the Central Area encompassing Part Lot 1, Part Lot 2 and Part Lot 3, and the Eastern Area comprising Part Lot 1, Part Lot 2 and Part Lot 3 (as indicated in a map annexed to the Points of Claim, filed 23 March 2016). The Central Area of the property is burdened by a Transmission Line Easement (TLE) which, beginning at the centre of the southern boundary, runs in a north-eastern direction towards the cul-de-sac on Glengarrie Road. The TLE has a total area of 28,299 square metres, with the land on the eastern side of the TLE having an area of 1,924 square metres, and the land on the western side of the TLE, an area of 56,350 square metres.

15. The topography of the land is, for the most part, level; however, it is slightly undulating. A low-point situated near the south-eastern corner runs west gently downward across the site to a centre-point on the western boundary.

The public purpose

16. Mr Constantine’s land was acquired by the Council with the acquisition being notified in the “Council Notices” section of the Government Gazette (the Gazette) of 13 February 2015. The public purposes for which the land was acquired are described in the notice in the Gazette as being for drainage, road and public recreation.

17. These purposes are required to be disregarded for the reasons earlier set out in the assessment of the value of the land compulsorily acquired.

The site inspection

18. As has become conventionally the case in such proceedings (although not universally so), we commenced the first day of the hearings with an inspection of the site and those sales relied upon by the valuers for comparability purposes.

19. Acting Commissioner Parker (for whose assistance in these proceedings I express my gratitude) and I met the legal representatives of the parties and those advising and instructing them at the site. We inspected the site, primarily that portion of the site described on the map earlier referred to as the “western area”.

20. We walked from the entrance gate at the north-eastern corner, diagonally across the site to the south-western corner where a short length of the western boundary of the site adjoins that parcel of land known as the “Air Services Australia site”. The importance of this site, in an ecological context, is discussed in more detail later in my consideration of the ecological evidence and town planning evidence.

21. At this point, we were able to observe the nature of the vegetation on the Air Services Australia site; the nature of the site to the immediate north of that site and the west of our site (a matter requiring further consideration in both an ecological and valuation fashion later in this judgment); the portion of the vegetation on the immediately adjacent property to the south; and, beyond that, the density of the vegetation protected, as later discussed, as a consequence of it being representative of “critically endangered ecological community”.

22. At this point during the site inspection, it was observed by Mr Galasso, senior counsel for the Council, that, during the course of the understorey slashing that had taken place on the site, elements of eucalypt regrowth had been severed. The effect of the slashing on eucalypt regrowth was obvious, to varying degrees of intensity, as we walked around this western area.

23. Mr Fanning, ecological consultant for Mr Constantine, observed that the slashing that had been undertaken was consistent with what he understood to have been the state of the site as at the date of acquisition, a matter also requiring further discussion later in the context of the ecological evidence.

24. We also walked along the short length of the drainage line (now so zoned) within the site that has been identified as the commencing element of an ephemeral watercourse draining in a westerly direction from the site across the more open land abutting the site along the majority of its western boundary (being the land immediately to the north of the Air Services Australia site).

25. Where the ephemeral watercourse traverses this land to the west, it has a somewhat sparse but nonetheless readily identifiable vegetated fringe in its riparian zone. This watercourse is subject to drainage and riparian zone restrictions. This land is also within the Marsden Park Precinct covered by Appendix 12 of the Growth Centres SEPP and has an indicative development layout shown in the plan for the precinct in that appendix.

26. Prior to leaving the site, we also observed, over the northern boundary, another parcel of land relied upon by the valuers as a comparable sale. This land, like the land to the west described above, is zoned R2 Low Density Residential, under the Precinct Plan.

27. The land to the north, it was observed during the course of the site inspection, had been sold subject to a put-and-call option sale arrangement. However, the valuers accepted they were satisfied that the sale was a certainty and that the nature of the sale arrangement, therefore, did not warrant further consideration in a valuation sense. This was subsequently confirmed to be the position by both of them during the course of their concurrent oral evidence.

28. We then left the site and returned along Glengarrie Road to South Street. During this transition, we were asked to observe (but did not stop at) a site in Glengarrie Road to the south of the land acquired from Mr Constantine – a site also relied upon by the valuers as a comparable sale. Sufficient understanding of this site could be obtained both from the drive-by and from the observations to the south across the boundary of our site when we were at the south-western corner of it.

29. We then proceeded to the current cul-de-sac at the western end of South Street as, at that point, it was possible to observe the site dealt with by Biscoe J in Maloney v Minister Administering the Environmental Planning & Assessment Act 1979 [2011] NSWLEC 121.

30. The site in Maloney was said by Mr Hemmings, senior counsel for Mr Constantine, to be illustrative of the vegetation across the fence on the Air Services Australia site and to be illustrative of the planning treatment as a consequence. The site in Maloney is not within the Marsden Park Precinct dealt with in Appendix 12 but is within the Marsden Park Industrial Precinct, a precinct to the south-east of the Appendix 12 precinct as can be seen from the boundaries shown on the Appendix 12 plan.

31. The front third of the land in Maloney is to form part of the Marsden Park Industrial Precinct, the initial stages of the development of which were able to be observed on the southern side of South Street, opposite the eastern portion of the Maloney site. Opposite the western portion of the Maloney site is a small area in the industrial precinct that is to be retained for ecological conservation purposes (but within which a stormwater detention structure is also proposed to be constructed). This was one of the three blue-hatched areas later discussed and identified for assessment of their conservation values.

32. Prior to describing the element of the site inspection away from the Glengarrie Road precinct, it is appropriate to observe that the land to the north of the site and the land to the south in Glengarrie Road are the two primary sites relied upon by the two valuers for the purposes of analysing the value to be adopted for R2 Low Density Residential land on the site.

33. We then left this locale and proceeded to a site at 536 Richmond Road at Glendenning to inspect a site utilised by the valuers for the purposes of deriving a value for land zoned E2 Environmental Conservation. From this location, we then proceeded to the locale of a further site, on the eastern side of the railway line to Richmond, a site located slightly to the north-east of the new Schofields Railway Station. This site, too, was relied upon by the valuers for the purposes of endeavouring to derive a value to be ascribed to E2 land.

34. Each of these sites, although not directly comparable and not zoned E2, were utilised due to the absence of any E2 sales able to be used for comparability purposes. It is unnecessary to describe these latter two sites.

The amendment application

35. At the commencement of the hearing, in Court after the site inspection, Mr Galasso sought leave for the Council to rely on Further Amended Points of Defence. This application sought to plead the Council's case in a significantly different fashion from that which had been foreshadowed during the entirety of the prehearing procedural and preparation stages.

36. Although not entirely on all fours with Maloney (where Biscoe J rejected a late application by the Minister (as the acquiring authority) to amend the pleadings in that instance to rely on the proposition that the Blacktown Local Environmental Plan 1988 should be the basis for informing the underlying zoning), the legal issues raised were similar.

37. For the reasons set out in Constantine v Blacktown City Council [2016] NSWLEC 56, I rejected this application.

The evidence at the hearing

The town planning evidence

38. Town planning evidence was given by Mr Haskew on behalf of Mr Constantine and by Mr Kennan on behalf of the Council. Each of them produced an extensive individual expert report (Haskew – Exhibit A, Court Book, Tab 5 and Kennan – Tab 4) and they combined to produce a Joint Expert Report on Planning Issues (Exhibit A, Court Book, Tab 6). They gave concurrent oral evidence during the course of the hearing. In addition, each of them gave advice to the relevant valuer retained by the party for whom they were giving evidence, advice which permitted the valuers to produce, for the second morning of the hearing, a Supplementary Joint Valuation Report. The nature of the advice given by each town planning expert to their associated valuer will be discussed in the context of my consideration of the valuation evidence arising from this. It is unnecessary to set that advice out at this point.

39. With respect to town planning issues in the broad, the experts were asked to consider what would be the underlying zoning of what is accepted to be the three component areas comprising the totality of the land compulsorily acquired from Mr Constantine. Those areas are, as earlier noted, an area to the east of the TLE; the TLE itself; and the area to the west of the TLE. The size of each of these areas was set out earlier in the description of the site ([13] to [15]). The underlying zoning to be determined is one which disregards the public purpose (as required by the Land Acquisition Act).

38. With respect to the eastern area and the TLE, Mr Haskew and Mr Kennan were in agreement as to what should be taken as the underlying zoning. They agreed that, for the eastern area, the underlying zoning was an unaffected R2 zoning (Exhibit A, Court Book, Tab 6, Joint Town Planning Report, folio 132 at [4.1]).

39. For the TLE, they agreed that the underlying zoning would also be R2, but subject to the restrictions on what might be the permitted activities or structures to be undertaken within the TLE, with these constraints being defined by the requirements of the relevant electricity supply authority, TransGrid. These constraints are clearly set out in a document in evidence behind Tab 14 of Exhibit B. The impact of these constraints is a matter dealt with later in the context of the extent to which the rate per square metre of the unconstrained R2-zoned land in the eastern portion of the site should be reduced to reflect the impact of those constraints on the value of the TLE land for uses permitted within the R2 zone but restricted by the overlaying of the electricity supply authority requirements.

40. These two foundational agreements substantially narrowed the task that the valuers were subsequently required to undertake but did not, as later discussed, lead to agreement by the valuers as to the appropriate dollar value per square metre to be applied to each of these R2 underlying zoned components of the land acquired from Mr Constantine.

41. There was, however, a fundamental difference between the approach taken by Mr Haskew and Mr Kennan to the land in the western portion of the site. Mr Kennan's position is that the underlying zoning of this portion of the site should be a conservation zoning, E2, with a very restricted range of activities capable of being undertaken within the land so zoned (Exhibit A, Court Book, Tab 4, folio 66). It is appropriate, at this point, to set out the relevant portion of the Zoning Table for land so zoned. It reads (Exhibit A, Court Book, Tab 5, folio 102A):

Zone E2 Environmental Conservation

1 Objectives of zone

• To protect, manage and restore areas of high ecological, scientific, cultural or aesthetic values.

• To prevent development that could destroy, damage or otherwise have an adverse effect on those values.

Land Use Table

2 Permitted without consent

Nil

3 Permitted with consent

Drainage; Earthworks; Environmental facilities; Environmental protection works; Flood mitigation works; Information and education facilities; Kiosks; Recreation areas; Roads; Signage; Waterbodies (artificial)

4 Prohibited

Any development not specified in item 2 or 3

44. Mr Haskew, on the other hand, held the opinion that the underlying zoning should (subject only to the electricity supply authority restrictions on activities in the TLE) be uniform across the totality of the land acquired from Mr Constantine, with that zoning being R2 Low Density Residential. The element in the Land Use Table for this zone is significantly more expansive than that applying in the E2 zone. The extract for the R2 zone (Exhibit A, Court Book, Tab 5, folios 102 to 102A) reads:

Zone R2 Low Density Residential

1 Objectives of zone

• To provide for the housing needs of the community within a low density residential environment.

• To enable other land uses that provide facilities or services to meet the day to day needs of residents.

• To allow residents to carry out a reasonable range of activities from their homes, where such activities are not likely to adversely affect the living environment of neighbours.

• To support the well-being of the community, by enabling educational, recreational, community, religious and other activities where compatible with the amenity of a low density residential environment.

Land Use Table

2 Permitted without consent

Home occupations

3 Permitted with consent

Bed and breakfast accommodation; Boarding houses; Business identification signs; Child care centres; Community facilities; Drainage; Dual occupancies; Dwelling houses; Earthworks; Educational establishments; Environmental protection works; Exhibition homes; Exhibition villages; Group homes; Health consulting rooms; Home-based child care; Home businesses; Home industries; Information and education facilities; Neighbourhood shops; Places of public worship; Roads; Secondary dwellings; Semi-detached dwellings; Seniors housing; Shop top housing; Studio dwellings; Veterinary hospitals

4 Prohibited

Any development not specified in item 2 or 3

45. Resolution of this town planning issue, after disregarding the two actual zonings within the western area that have arisen as a consequence of the public purpose as earlier set out, is the essential step in determining what approach should be taken to the valuation of this portion of the site.

The underlying zoning of the western area

46. In seeking to establish what should be regarded as the underlying zoning of the area to the west of the TLE, it is appropriate to set out a chronology of the ecological assessment processes that have been undertaken in this portion of north-western Sydney. These processes commenced in July 2003 and demonstrate a process of evaluation of the ecological significance of various parcels of land (including the relevant portion of Mr Constantine’s land). A short chronology of the relevant assessment processes (also noting the dates of the gazettal of the Growth Centres SEPP and the biodiversity certification relevant in these proceedings) is:

EcoLogical Assessment Activities Chronology

1   July 2003 – EcoLogical Assessment North West Sector Study Area (Exhibit B, Tab 1)

∞   EcoLogical was engaged by Planning New South Wales to undertake an ecological assessment of an area in North West Sydney.

∞   The objectives of the assessment were to identify the relative conservation significance of the remnant native vegetation, aquatic habitats, and riparian areas within the study area so as to inform a regional structural planning process, and to identify two options for achieving regional habitat connectivity within and across the study area so as to inform a regional structural planning process (page 1).

∞   Major recommendations of the report related to the adoption of the regional conservation significance assessment and connectivity results in undertaking regional structure planning scope and agree on methods to address (page 2).

2   February 2007 – Growth Centres Conservation Plan Exhibition Draft (Exhibit B, Tab 2).

∞   Assessment listed key actions for the improvement or maintenance of biodiversity values in the Growth Centres namely the protection of 967 hectares of land containing 643 hectares of high quality native vegetation through environment conservation and recreation zones identified by the SEPP; protection of a further 880 hectares of native vegetation through developing controls identified in the SEPP; implementation of conservation of SEPP's program to secure the protection of at least 2,300 hectares of priority, high quality vegetation in western Sydney and the Sydney Basin. It is further noted that these actions are combined with 476 hectares of high quality vegetation which is currently protected.

∞   Recommended further investigation and assessment for the presence of significance of high quality native vegetation in the area adjoining Air services' site at Shanes Park in North West Growth Centre.

∞   Three assessments were carried out; endangered ecological communities, threatened flora, and threatened fauna. The methodology for each of these assessments is set out in appendix 2.

∞   The results of the management viability assessment demonstrated that 584 hectares of High Long Term Management Viability (HMV) and 3,284 hectares of Lower Long Term Management Viability (LMV) are present within the Growth Centres. Of this, 557 hectares of HMV and 1,443 hectares of LMV were found within the identified protected lands. The assessment indicated that there are 27 hectares of HMV which exist outside the protected lands. These consist of small areas of vegetation adjoining the environmental conservation zoned land at the Air serves site, Shanes Park.

3 July 2007 - Gazettal of the Growth Centre SEPP

4   December 2007 - Biodiversity Certification on the SEPP made (Exhibit B, Tab 3)

5   July 2012 - Marsden Park Precinct Biodiversity and Riparian Assessment prepared by EcoLogical (Exhibit B, Tab 6)

∞   The report concerned the ecological and riparian assessment of approximately 1800 ha that forms the Marsden Park Precinct. The Author observed that a field survey was undertaken and it is stated that from a rezoning perspective, the riparian corridors and Existing Native Vegetation (ENV) on non-certified lands are recommended to be zoned for environmental protection (page 8)

(i)   Terrestrial biodiversity assessment (page 15):

∞ Author observed that Marsden Park Precinct has been biodiversity certified and refers to the draft Growth centre’s conservation plan which assessed native vegetation across the entire Growth Centre’s area and identified areas of ENV, meaning areas of indigenous trees (including mature and sapling) that:

(a)   Had 10% or greater over storey canopy cover present;

(b)   Were equal to or greater than 0.5 ha in area, and

(c) Were identified as “vegetation” on maps 4 & 5 of the draft Growth centre’s conservation plan, at the time the biodiversity certification order took effect, subject to RBM 13.

∞   Primary function of report was to validate the ENV in Marsden Park so that the indicative layout plan and subsequent zoning of the precinct could be assessed against the relevant biodiversity measures of the certification order (validation processes are described in the methods section).

∞   Validation of existing native vegetation in the Shanes Park Air services site was undertaken by desktop methods only, as no development was planned within this area.

∞   The field validation of vegetation across the site updated the extent of ENV within the precinct. During the field validation, areas of vegetation meeting only (a) and (b) of the definition were recorded as Additional High Conservation Value vegetation (AHCV) (page 15, at [3]).

(ii)   Conservation and management recommendations for indicative layout plan (page 41)

∞   Outlined that Marsden park precinct contained ENV that needed to be protected to maintain parity with the Biodiversity Order, highlighting that the greatest conservation value was the 600 ha Air Services Australia Site that contains numerous threatened species.

6   September 2013 - Growth Centres Biodiversity Certification: Assessment of Consistency between Relevant Biodiversity Measures and Marsden Park Precinct

∞   identified a minimum of 2000 hectares to be retained and protected in the growth centres and that 450 ha of existing native vegetation should be retained in the Marsden Park precinct.

∞   Outlined that SEPP will include various clauses including a development control clause as to ENV and requirements of a Vegetation Management Plan (VMP) in land zoned E2 (page 5).

∞   Land to be zoned E2 and E3 is to remain in private ownership. Land to be zoned RE1 is to be acquired by Council and ENV within the RE1 zone will be protected by the SEPP clauses and relevant maps (page 6).

∞   Coupled with the Additional High Conservation Value vegetation (AHCVV), in total there will be 538.31 ha of ENV and AHCVV to be protected in the precinct (page 7).

∞   Conclusion to the investigation report stated, inter alia, in relation to land use zones, that the use of the E2 Environmental Conservation zone is preferred by the OEH (page 18).

7   September 2013 – Growth Centres Strategic Assessment Program: Assessment of Consistency between the Commitments of the Strategic Assessment Program and Marsden Park Precinct (Exhibit B, Tab 8)

∞   Assessment of the blue hatched area adjacent to Shanes park found to be Shale Gravel Transition Forest (6.1 ha with canopy cover greater than 10%). Identified that this area should be protected in accordance with RBM 16 and that OEH would make such a recommendation to its Minister.

47. The above chronology makes it clear that, antecedent to detailed planning for the Marsden Park Precinct (or, indeed, the Marsden Park Industrial Precinct), assessment had been being undertaken of the significance of ecological values on lands within the areas that later became encompassed by these two precincts.

Biocertification

48. The Threatened Species Conservation Act 1995 provides a mechanism, in Part 7AA, whereby, for projects or areas, a broad ecological evaluation can be undertaken and the parameters for the protection of flora and fauna otherwise protected by the legislation being set for an area. The engagement of this process enables a determination to be made on a broad, anticipatory basis in a fashion that, for identified areas, will remove the necessity for individual ecological assessments for proposed developments. Such a biodiversity certification process has been undertaken, on a broad basis, for an identified area within the area covered by the SEPP and incorporating (but also extending well beyond) the Marsden Park Precinct.

49. The biodiversity certification process for this broader area identified the desirability of preserving a minimum of 2,000 hectares of land for their conservation values within the included areas (Exhibit B, Tab 7, page 4). The contribution to this 2,000-hectare total identified for the Marsden Park Precinct was a minimum of 450 hectares (Exhibit B, Tab 7, page 4).

50. Some of the land in the Marsden Park Precinct readily able to be identified as appropriate for incorporation within this 450-hectare minimum area is located on portion of the Air Services Australia site, a large parcel (approximately 560 hectares) at the south-western corner of the precinct. Other land within the Marsden Park Precinct was also identified as having environmental values warranting conservation and these were also identified for conservation purposes.

51. Within the broader area, however, three areas in the vicinity of the Air Services Australia site were marked as blue-hatched on the relevant plan (Exhibit A, Court Book, Tab 4, folio 89), with this hatching identifying them as warranting further investigation as to whether they should be considered for protection for their ecological values or whether they should be released for development. Their ecological value, shared with the Air Services Australia site, arises from the presence of Shale Gravel Transition Forest on these parcels.

52. Two of those blue-hatched areas are in what is now the Marsden Park Industrial Precinct, the area to the south-east of, and sharing a lengthy boundary with, the Marsden Park Precinct. As the planning for the Marsden Park Industrial Precinct was finalised at an earlier stage than that of the Marsden Park Precinct, resolution of the future of the two blue-hatched areas in that precinct has also been finalised. Each of these two areas has been given an environmental conservation zoning. The assessment process leading to that result for each of these two formerly blue-hatched parcels requires more detailed consideration later.

53. It is to be observed, however, that the conclusion to be drawn about a particular area of vegetation is not mandated by the outcome of a Schedule 3 assessment undertaken through the biocertification process. The results derived from such an assessment process inform the making of the discretionary decision required after the completion of such an assessment. In particular, failure to satisfy all of the criteria in the schedule is not an impediment to the proper making of a decision to conserve a particular patch of vegetation.

54. This is clear from the fact that, as is later discussed in more detail, the two blue-hatched patches of Shale Gravel Transition Forest to the south of the land acquired from Mr Constantine in the Marsden Park Industrial Precinct were given a conservation zoning despite the fact that each of them did not satisfy all of the tests set in Schedule 3. The assessment process and the results so derived are discussed in more detail later.

55. At this point, it is sufficient to note that these two parcels shared the initial blue hatching for future assessment that applied to the western area of the land acquired from Mr Constantine, and that the same endangered ecological community as is located on these two patches is also the vegetation association located on the western area of the land acquired from Mr Constantine.

The assessment of the blue-hatched areas

56. The assessments of the two formerly blue-hatched parcels in the Marsden Park Industrial Precinct are contained in a report prepared by environmental consultants, EcoLogical. The report is dated May 2009 and forms part of Exhibit B at Tab 5.

57. The more northern of the two portions is, like the vegetation on the land acquired from Mr Constantine, contiguous with the Air Services Australia site earlier described. The Schedule 3 assessment for this vegetated area is at folios 83 to 86 of the EcoLogical report. It is in the following terms:

Schedule 3 Criteria Assessments

Northwest Remnant

(a) Does the area contain an endangered ecological community as listed under the Act;

Yes, this remnant contains Shale Gravel Transition Forest, which is listed as an EEC under the Act.

(b) Does the area exist as contiguous with the existing native vegetation on the Air Services Site;

Yes, this remnant is contiguous with the vegetation on the Air Services Site.

(c) is the area equal or greater to 4 hectares;

Yes, this area is equal to 4.7 hectares

(d) does the area have greater than 10% canopy cover

Yes the vegetation within this area is considered to be of A condition and therefore has >10% canopy cover.

(e) does this patch have 30% or greater vegetation cover within;

i) a 0.55 km radius - yes, the vegetation cover exists within the Shane's park

site

ii) 1.75km radius - yes, the vegetation cover exists within the Shane's park site

(f) does the area, as measured from the approximate centre point of each area;

(g) have a perimeter to area ratio that is conducive to on-going conservation management

The perimeter to ratio area for this remnant is 0.03. This ratio is extremely low, and indicates that this remnant will be significantly impacted by edge effects and in its current configuration will not be conducive to on-going conservation management.

(h) whether after applying a 50 metre disturbance buffer to the edge of each area (where the edge is likely to be made available for future urban development as identified in the SEPP), the overall size of the area then falls below 4 hectares

Yes, applying the 50m buffer to the edges proposed for future urban development, the area of this remnant falls below 4 hectares.

58. As can be seen from the terms of the assessment, this parcel did not satisfy each of the criteria called up by Schedule 3. Nonetheless, a determination was made that this vegetated area should be zoned for environmental conservation. No material in addition to the EcoLogical report is available to shed further light on the process that led to the decision to effect that zoning.

59. The second, more southern portion of this blue-hatched land containing the endangered ecological community was in the following terms:

Southwest Remnant

(a)   Does the area contain an endangered ecological community as listed under the Act;

Yes, this remnant contains Shale Gravel Transition Forest, which is listed as an EEC under the Act.

(b)   Does the area exist as contiguous with the existing native vegetation on the Air Services Site;

No, this remnant is divided from the vegetation on the Air Services Site by a formed road.

(c)   Is the area equal or greater to 4 hectares;

No, this area is equal to 1.3 hectares

(d)    Does the area have greater than 10% canopy cover

Yes the vegetation within this area is considered to be of A condition and therefore has >10% canopy cover.

(e)    Does this patch have 30% or greater vegetation cover within;

i) a 0.55 km radius - yes, the vegetation cover exists within the Shane's park

site

ii) 1.75km radius - yes, the vegetation cover exists within the Shane's park site

(f)    Does the area, as measured from the approximate centre point of each area;

(g)    Have a perimeter to area ratio that is conducive to on-going conservation Management

The perimeter to ratio area for this remnant is 0.04. This ratio is extremely low, and indicates that this remnant will be significantly impacted by edge effects and in its current configuration will not be conducive to on-going conservation management.

(h)    Whether after applying a 50 metre disturbance buffer to the edge of each area (where the edge is likely to be made available for future urban development as identified in the SEPP), the overall size of the area then falls below 4 hectares

Yes, applying the 50m buffer to the edges proposed for future urban development, the area of this remnant falls below 4 hectares.

60. The same general comments concerning the derivation of the conservation zoning to the first of these vegetated areas are also applicable to this second area.

61. However, two aspects of this second area warrant specific noting. The first is that this vegetated area, although generally oval in shape, is considerably smaller than either the western area of land acquired from Mr Constantine or the more northern of these two vegetated patches. The second matter to be noted is that this area is not contiguous with the Air Services Australia site but is separated from it by the element of South Street that runs to the west from Glengarrie Road along the boundary of the Air Services Australia site and the land earlier described as the Maloney land.

62. Despite these two factors, this land was given a conservation zoning although factors were less favourable than the western element of the land acquired from Mr Constantine.

63. It is clear, that, despite the deficiencies in the Schedule 3 assessments for the two blue-hatched areas within the Marsden Park Industrial Precinct, their ecological values were considered to be sufficiently high to warrant being given an environmental protection zoning despite those deficiencies.

64. Mr Galasso submitted that consideration of this process, demonstrating that the ecological assessment process was antecedent to the detailed planning of the Marsden Park Precinct, provided an appropriate basis for accepting that the underlying zoning of the portion of Mr Constantine’s land west of the TLE should be the E2 environmental zoning contended by the Council.

A Schedule 3 assessment of the western area of Mr Constantine’s land

65. Mr Fanning and Mr Conacher, in their Joint Ecological Report, set out their positions with respect to the western portion of the land acquired from Mr Constantine. This was done in terms of tables at Attachments 1 and 2 of their joint report and incorporated, in Mr Fanning's assessment, the assessment undertaken by EcoLogical Australia in 2012. I have had these two tables combined, showing the criteria in Schedule 3; the comments in the 2012 assessment; Mr Conacher’s assessment and, finally, Mr Fanning's assessment.

66. The consolidated table showing the assessment of the western portion of Mr Constantine’s land, with respect to the criteria in Schedule 3 of the Biodiversity Certification Order, is reproduced below:

Criteria as per Schedule 3	ELA Assessment 2012	Conacher comments	Fanning comments
a	Contain an endangered ecological community as listed under the Act	Yes - community is Shale-Gravel Transition Forest which is an EEC	Yes - Shale Gravel Transition Forest (SGTF)/Cumberland Plain Woodland mapped as occurring on site.	Yes - most (but not all) of the vegetation present is a disturbed-to-highly degraded form of the SGTF community
b	Are contiguous with the existing native vegetation on the Air Services Australia site	Yes - the area is contiguous, albeit via a narrow 20-30-metre common boundary with the Air Services site	Yes - site and vegetation adjoins Air Services Australia site along its south-west boundary.	Yes, just - the patch is only marginally contiguous with the Shanes Park Air Services Australia site – with just a 25-metre-wide common boundary with that site (Figure 2)
c	Are equal to or greater than 4 hectares	Yes - the patch is 6.8 hectares	Yes - the area west of power-line easement is measured as 5.6 hectares.	No - the relevant patch of vegetation on the subject land (>10% canopy) is, in fact, only 2.7 hectares - excluding the farm dam, highly modified pasture with <10% canopy, and canopy overhanging the Transmission Line Easement (TLE) and/or property boundaries (Figure 5) Criterion (d) indicates that the relevant vegetation is that with a canopy cover greater than 10%
d	Have 10% or greater canopy cover	Yes - the canopy cover is roughly 20% and is therefore greater than 10%	Yes - vegetation canopy cover exceeds 10% (measured as 26%)	Only in part - parts of the subject land (2.7 hectares) contain vegetation with a tree canopy >10% (particularly along the western boundary and a strip immediately west of the TLE) But substantial parts (3.1 hectares) have vegetation with a tree canopy of <10% (Figure 5) - as was mapped by ELA in 2003
e	Have 30% or greater vegetation cover within:	See calculations in Table 2 below
	i   a 0.55-kilometre radius (for local connectivity), and,	Yes - vegetation cover within a 0.55-kilometre radius is 45.85%	Yes - Total Area: 95.0 hectares Vegetation Area: 30.4 hectares = 32.01% cover	No - the actual area of vegetation within a 0.55-kilometre radius is 22.8% (Figure 3) Further, if the vegetation within that circle that is approved for removal through the Marsden Park Precinct Plan and the MPIP Precinct Plan is excluded (as it must be), then the area falls to 19.6% (Figure 3A)
	ii   a 1.75-kilometre radius (for regional connectivity)	Yes - vegetation cover within a 1.75-kilometre radius is 36.76%	Yes - Total Area: 962.1 hectares Vegetation Area: 303.8 hectares = 31.58% cover	No - the actual area of vegetation within a 1.75-kilometre radius is 28.7% (Figure 4)
f	as measured from approximate centre-point of each area	Yes - areas measured from centre of assessment area	Further, if the vegetation within that circle that is approved for removal through the Marsden Park Precinct Plan and the MPIP Precinct Plan is excluded (as it must be), then the area falls to 24.3% (Figure 4A)
g	Have a perimeter-to-area ratio that is conducive to ongoing conservation management	Yes - at 6.8 hectares, the patch is of a size that is conducive to conservation management	Yes - the area has a perimeter of 1,050 lineal metres and area of 5.6 hectares and is roughly triangular in shape. The length (350 metres) to width (80-260 metres) ratio results in a shape which minimises the management requirements in comparison to a reserve shape which is much longer than it is wide.	No - there are actually two patches - one to the north of the drainage easement and one to the south (see Planning NSW 2013a, b) Even if calculated as a single patch, the subject land will be completely surrounded by urban development as a small extension of the Air Services Australia site (other than at the tenuous connection to that site) Although the 'perimeter-to-area ratios' for the two patches are not unacceptable per se, they merely add to the management edge for the Air Services Australia site without adding materially to the area of conserved vegetation, and are not therefore ‘conducive to on-going conservation management'
h	Whether, after applying a 50-metre disturbance buffer to the edge of each area (where that edge is likely to be made available for future urban development as identified in the SEPP), the overall size of the area then falls below 4 hectares	Yes - an internal buffer of the northern and western boundaries (which are those likely to be available for urban development) would reduce the patch by 2.8 hectares, bringing the size down to 4 hectares	Yes - area not included in 50-metre buffer is 3.0 hectares, which is <4 hectares.	No - the 50-metre buffers principally apply only to the western and northern boundaries These buffers reduce the whole 'area' (excluding the drainage easement) to just 3.28 hectares - which is significantly less than 4 hectares Again, the 'patch' should be limited to that area with a canopy cover >10% - see Criterion (d) above (Figure 5) On that basis, the 'area' declines to just 1.16 hectares - in fragmented patches on the subject land (Figure 6)

67. Although Mr Fanning's comments are, in many respects, negative and, in at least one respect inaccurate (in that, in his analysis of factor (g) of Schedule 3, he fails to disregard the drainage easement element of the public purpose – an impermissible failure given the statutory disregard), they are to be read as “better” than the analyses for the other two blue-hatched areas. However, overall, it is clear that this assessment is, in fact, even on Mr Fanning's basis (disregarding factor (g)) and, certainly on the bases of the other two analyses against Schedule 3, less negative an assessment than that which was derived for either of the other blue-hatched areas for which it has been determined appropriate to give a conservation zoning.

68. For the portion of Mr Constantine’s land west of the TLE, it is clear from the above Schedule 3 assessment, properly understood, that it has a greater degree of consistency with the matters contained in the schedule than either of the portions of land in the Marsden Park Industrial Precinct that have been given the benefit of the conservation zoning.

69. Consistency of approach, when coupled with the specific identification of this portion of Mr Constantine’s land for future ecological significance assessment, and with the outcome of the Schedule 3 assessment for the western portion of the land acquired from Mr Constantine, confirms that there is a sufficient basis to conclude that, absent the public purpose, this land, too, would have been given the same environmental conservation zoning as the other two blue-hatched parcels.

The conservation area “surplus”

70. I have earlier outlined the broad conservation target of 2,000 hectares of environmentally sensitive land to be conserved as part of the biodiversity certification process for this area within the planning scope of the Growth Centres SEPP. The Marsden Park Precinct was identified to contribute 450 hectares of that total (Exhibit B, Tab 7, page 4). The vast bulk of that area is to be contributed by the dedication of the Air Services Australia site in the south-western corner of the precinct. This land comprises 432.05 hectares of the minimum 450-hectare total.

71. There is an analysis of the ecological value of various parcels within the precinct, ranking them according to an assessment by EcoLogical as to their ecological value. That assessment (Exhibit B, Tab 7, pages 4 to 7) discloses that there are 538.31 hectares of land within the precinct that have the ecological values sufficient to warrant consideration for conservation.

72. As I understood Mr Hemmings’ submissions, this meant, effectively, that there was a “surplus” of 82.03 hectares so that, if the western area of the land acquired from Mr Constantine were to be either treated as if the underlying zoning was R2 or, if it were to be E2, was up-zoned to R2, the conservation target for the Marsden Park Precinct could still be achieved.

73. It is certainly, from a purely mathematical perspective, an analysis able to be adopted if it were to be appropriate. However, there are two impediments to taking this approach as being appropriate. First, the 450-hectare conservation area contribution set for the Marsden Park Precinct was set as a minimum rather than as a fixed quota. As a consequence, if conservation values warranted it, there is no reason why a somewhat larger area (in this case, a minimally somewhat larger area) could not be protected. There is, therefore, no “surplus as of right” that must be excluded from being protected. More importantly, for the reasons discussed below as to why I am satisfied that a hypothetical up-zoning application (subject to risk and timing allowances) to lift the land from an E2 zoning to an R2 zoning as its highest and best hypothetical use absent the public purpose would not succeed, I am satisfied that a proper consideration of the ecological attributes show:

1. First, this ecologically important land warrants conservation in the context of the decision to conserve the two blue-hatched parcels to the south in the Marsden Park Industrial Precinct (a comparative analysis of these with the western portion of the land acquired from Mr Constantine was earlier set out); and

2. There are other areas of the land that were the subject of the ecological analysis of vegetated lands within the Marsden Park Precinct that, on the basis of that analysis, would appear to have lower ecological values than those of the western portion of the land acquired from Mr Constantine, thus at least leading to the potential inference that, if there was a surplus which might be considered to be released, this land would not be the first appropriate to be considered for such a release.

Conclusion on underlying zoning of western area

74. I have concluded that the underlying zoning for the western portion of Mr Constantine’s land is E2.

The potential for “up-zoning” to R2

75. During the course of the hearing, Mr Phippen and Mr Good produced a Supplementary Joint Valuation Report dealing with what should be the proper valuation approach to be taken to a hypothetical application to up-zone the western land from E2 to R2 in the event that I were minded to conclude that the proper underlying zoning for the western area, disregarding the public purpose, was, in fact, E2 Environmental Conservation.

76. This supplementary report was brief and was based on information obtained from their relevant advising town planner. Mr Phippen drew upon the comments made by Mr Haskew in the Joint Town Planners Report of October 2015. As Mr Kennan had expressed the view in that joint report that such an up-zoning would not occur, Mr Good sought further advice from Mr Kennan on this point to assist in the preparation of this supplementary report.

77. Although, ordinarily, it might be expected that the appropriate step-through sequence for consideration of this issue might be in the traditional order - namely, ecological, town planning prospects and, contingent on those, the valuation outcome - it will make more sense in this context to set out the valuation outcome postulated in the supplementary report and canvassed in Mr Phippen’s and Mr Good's oral evidence as a precursor to the ecological and town planning considerations.

78. Fortunately, the supplementary report dealt with this in comparatively brief compass, as did the oral evidence concerning it. It is, therefore, convenient to reproduce the relevant portion of the supplementary report before setting out the effect of the oral evidence and moving on to the further required analysis of the other disciplines. The relevant portion of the valuers’ supplementary report (Exhibit C) was in the following terms:

5 The purpose of this Joint Conference was to discuss the market value of the subject property based on the premise that the land had an underlying zoning of E2 but the land could be re-zoned in accordance with the scenario outlined in Section 7 on pages 11 & 12 of the Town Planning Expert Witness Joint Report dated 22 October 2015.

Mr Phippen's Opinion

6 In clause 7.8 of this document the Applicants Town Planner David Haskew stated "that the prospects of a successful Planning Proposal Application (to rezone the subject land from E2 to R2) were very high".

7 In clause 7.9 Mr Haskew stated that "in relation to the timing of such a Planning Proposal Application, I would advise that the likely time frame would be 12 to 18 months".

8 In a letter to the Applicants solicitor Mr Perkins prepared by me on 10 April 2016 I stated that I considered an appropriate discount from the R2 market value of the subject land in accordance with this scenario would be 10% on the basis that the rezoning would take less than one year.

9 In accordance with Mr Haskew's opinion that it might take 18 months, I have adjusted the figure from 10% to 15% to allow for the additional 6 months

10 The calculations therefore show:

Particulars	Area	$PSM	TOTAL
Outside the TLE	58,274	$250	$14,568,500
Within the TLE	28,299	$100	$2,829,900
Total Compensation	$17,398,400
Rounded To …	$17,400,000
Less Discount for Delay and Risk	15%	$2,610,000	$14,790,000

11 On the basis that the prospects of procuring a rezoning of the subject land from E2 to R2 would be predictable and certain within an 18 month time frame, I believe that the subject land would have a fair market value of $14,790,000.

Mr. Good's Opinion

12 In clause 7.10 the Respondent's Town Planner Mr Kennan stated "This issue was not discussed in the joint reporting process and I am of the opinion that it has no relevance to the task of determining the zoning of the site absence of public purpose".

13 I contacted Mr Kennan by telephone this afternoon to clarify the Gateway Planning Process and the Review Process to establish - (a) likelihood of the rezoning being achieved and (b) the likely timing of rezoning was approved.

14 Mr Kennan advised that he thought the rezoning would be unlikely, however if the rezoning was approved he considered that the process would take approximately two years from the date of application through to the gazettal of the rezoning.

15 On basis of Mr Kennan's advice and taking into account other factors, which include but are not limited to, other market opportunities of appropriately zoned land and the potential market adjustment as a result of global economic conditions over the next two years, we consider a risk factor of 25% would be appropriate.

16 Accordingly, previously assessed Market Value assuming R2 zoning $16,250,000 x 125/100 = $13,000,000.

17 On the basis of procuring a rezoning of the subject land from E2 to R2 would be achievable through the Gateway Planning and Review Processes and certain within two year time frame, I believe that the subject land would have a market value of $13,000,000.

18 I note that my assessment of $13,000,000 equates to an overall rate of about $150 per square metre for the total acquisition area of 86,573 square metres (inclusive of the TLE).

79. As can be seen from the document, there remains a disagreement between Mr Phippen and Mr Good as to what should be the appropriate rates for land that might be zoned R2 (and, separately, the extent of the discount to such zoned land for the TLE). However, Mr Phippen confirmed, in his oral evidence, that, if the hypothetical up-zoning application were successful but took two years rather than the 12 to 18 months postulated by Mr Haskew, then the discount factor appropriate to be applied would be 20% rather than 15%.

80. Whilst Mr Phippen and Mr Good used different terminology (Mr Phippen “discount”, and Mr Good “factor”) and expressed them in differing mathematical form, the mathematical outcome of what each of them proposed was the same, as was the effective incremental steps of 5% for each six months that such a process would take. It is, therefore, appropriate to move on to consider the ecological and town planning positions with respect to such a hypothetical up-zoning proposal.

The ecological evidence relevant to up-zoning

81. Mr Fanning and Mr Conacher, the ecological expert retained by the Council, prepared a Joint Ecological Report (Exhibit A, Tab 9, folios 313 to 327). This document set out, at folio 316, a number of key matters of agreement. The first seven of them are relevant in this consideration of the western area of the land acquired from Mr Constantine. They are in the following terms:

2   KEY MATTERS OF AGREEMENT

i. The western area of the subject land contains a mosaic of modified woodland and pasture (containing introduced and native grasses).

ii. A small patch of Cumberland Plain Woodland (CPW) - a "critically endangered ecological community" - is present in the southwestern corner.

iii. Shale Gravel Transition Forest (SGTF) - an "endangered ecological community" - is present within the western area of the subject land.

iv. Parts of the western area contain previously cleared areas and degraded habitat.

v. The western area of the subject land contains areas of regrowth vegetation and mature canopy trees, as well as numbers of dead trees.

vi. One large hollow-bearing tree was observed within the western area of the subject land.

vii. The Biodiversity Certification Order establishes the criteria for further assessment of the land pursuant to the Growth Centres SEPP process.

82. They also identified, on the same page, two key matters with respect to which they were in disagreement. The first of them is not relevant as it arises as a consequence of the giving effect to the public purpose; however, the second of them is relevant, it being in the following terms:

Whether, absent public purpose, the land could (or should) have been zoned R2 Low Density Residential thus permitting the clearing of the vegetation thereon for residential development.

83. The starting point for my consideration of whether or not an up-zoning to R2 Low Density Residential could be hypothesised as a realistic future outcome must come from my consideration of these experts’ evidence on a number of matters. Each of them produced a detailed individual statement of evidence but the relevant aspects of them are concisely summarised in the Joint Ecological Report. It is appropriate to set out at some length a number of extracts from this report. The first, at folio 317, is under the heading “Extent and Condition of Threatened Ecological Communities”. Mr Fanning’s summary on this point was in the following terms:

4.1   Extent and Condition of Threatened EcoLogical Communities

Dominic Fanning

i. The 'western area' of the subject land has been variously mapped in a number of documents associated with the SEPP3 - in various and, at least occasionally, inconsistent manners (see Appendix C of my original Report).

ii. Many of those vegetation maps are at least partially incorrect.

iii. Most (but not all) of the vegetation in the western area of the subject land consists of either the CPW community (a very small area) or the SGTF community.

iv. At least half of the SGTF vegetation in the western area of the subject land is in poor to very poor condition - with very high levels of pasture grasses and weeds, dead and/or dying trees and a tree canopy of less than 10%.

v. The condition of the vegetation is of critical importance to its 'treatment' in the SEPP and Precinct Planning processes, and to any consideration of its development potential absent the public purpose (see inter alia Matters 3.2, 3.3 and 3.4 below).

vi. As noted below, there are a considerable number of patches of SGTF and other TECs (including CPW) within the Marsden Park Precincts that are larger and in better condition that the vegetation on the subject land - yet have been identified for complete removal.

84. On the other hand, Mr Conacher's contrasting view was as follows:

Phillip Conacher

i. The whole of the western area is mapped as either the critically endangered ecological community Cumberland Plain Woodland in the Sydney Basin Bioregion (CPW) or the endangered ecological community Shale Gravel Transition Forest in the Sydney Basin Bioregion (SGTF).

ii. Regrowth is occurring and further regrowth potential is significant.

iii. Most of the disturbed areas of vegetation within an area of land containing native species and for the purpose of vegetation mapping at this site scale would be included as one of the endangered ecological communities (CPW or SGTF) present.

iv. Disturbed areas of CPW and SGTF are considered to form part of the endangered ecological communities as identified by the NSW Scientific Committee.

85. It is appropriate to observe, at this point, with respect to the second of the points made by Mr Conacher, that the extent of the small eucalypt saplings that were emerging, as observed during the course of the site inspection, when coupled with the number of dead, small eucalypt saplings that were able to be observed as having been slashed, comparatively recently, over significant portions of the western area of the site, causes me to conclude that Mr Conacher's opinion, as thus expressed, is accurate. This was a relevant element, in my assessment, in considering the outcome of, and conclusion to be drawn from, the Schedule 3 assessment for the western area undertaken through the process set out in the Biodiversity Certification Order.

86. The joint report went on, at folio 319, to deal with what was described as consideration of the current ecological constraints to development of the land absent public purpose and ignoring the current zoning of the land. On this point Mr Fanning wrote:

4.3   Ecological Constraints to Development

This consideration is of the ecological constraints to development of the land absent the public purpose and ignoring the current zoning of the land.

Dominic Fanning

i. The presence of TECS and threatened species does not constitute a prohibition on development of the land.

ii. The presence of SGTF and a small area of CPW on the subject land would not prevent development of the subject land - given:

• the poor to very poor condition of much of that vegetation

• its isolation by surrounding cleared paddocks, the cleared part of the transmission line easement, and Glengarrie Road

• the proximity of the substantial area of SGTF and CPW in the Air Services site

iii. The small patch of Grevillea juniperina var juniperina would not constrain development given the abundance of this species in the landscape at Marsden Park.

iv. Had the subject land been identified for development, all of the relevant offsets would have been accommodated in the Growth Centres SEPP BioCertification. No other offsets would have been required.

v. I note that there are a considerable number of patches of SGTF and other TECs (including CPW) within the Marsden Park Precincts that are larger and in better condition that the vegetation on the subject land - yet have been identified for complete removal.

vi. On that basis, it cannot be considered a reasonable proposition that, absent the public purpose, the vegetation on the subject land would not have been identified for removal.

87. Given that the possibility of up-zoning of the land has been postulated, at least by Mr Haskew, as being in reasonable prospect, this requires my consideration as a potentially significant element of the valuation outcome.

88. If I were to accept that there was any realistic prospect of up-zoning, a potential value increment would arise of a little over $6,750,000 on the basis of the difference between an R2 and an E2 zoning for the western area, minus a 20% timing and risk adjustment on the basis that it might take two years or so to achieve such an up-zoning through a planning proposal application.

89. The critical elements of Mr Fanning's conclusions to be considered on this point are contained in the fourth, fifth and sixth points of his material extracted above.

90. The first of them, what might appropriately be described as a Cervantes point, one that is set up to be tilted at but lacks inherent validity from its own terms. Mr Fanning said, as set out above:

Had the subject land been identified for development, all of the relevant offsets would have been accommodated in the Growth Centres SEPP BioCertification. No other offsets would have been required.

91. However, it wasn’t – therefore this comment, although undoubtedly true, is totally irrelevant.

92. Mr Fanning’s second proposition, contained in his fifth point, should, in my assessment, be regarded similarly. The matrix for assessment within which the western area of the land acquired from Mr Constantine should be viewed is that of the blue hatching of the three areas specifically identified for further consideration; the outcomes of the Schedule 3 analyses for the two blue-hatched areas in the Marsden Park Industrial Precinct that were either contiguous with, or adjacent to, the Air Services Australia site; the fact that, notwithstanding the less favourable analysis than that which is to be drawn as a result of applying Schedule 3 of the biodiversity certification order to the attributes of the land here considered, those lands were identified as warranting being given conservation status.

93. His conclusion, in the sixth point, flows only if the fourth and fifth points provided foundation for it. As they cannot, it, too, is to be ignored.

Conclusion on up-zoning

94. For the reasons earlier identified, it is appropriate to conclude that the western area would have retained a zoning consistent with the other lands contiguous with, or in close proximity to, the Air Services Australia site and having the same broad, current and likely future floristic characteristics.

95. I am satisfied that the postulated prospect of up-zoning from E2 to R2 should not be accepted as having any hypothetical possibility of achievement.

The valuation evidence generally

The valuers

96. Mr Phippen, Registered Valuer No 26533, prepared a report dated 25 November 2015 (Exhibit A, Tab 11) and gave expert evidence on behalf of the Applicant. Mr Good, Registered Valuer No 2346, prepared an undated report (Exhibit A, Tab 10) and gave expert evidence on behalf of the Respondent.

97. Mr Phippen and Mr Good contributed to two joint reports dated 3 December 2015 (Exhibit A, Tab 12) and 11 April 2016 (Exhibit C), respectively.

Mr Phippen’s evidence on behalf of the Applicant

98. Mr Phippen assessed the compensation payable under s 55(a) to be $19,548,000 and under s 59(f) to be $30,000, totalling $19,578,000 (Exhibit A, Tab 11, page 456), based on different rates per square metre for different use descriptions of land with an underlying R2 zoning and adopting the direct comparison of sales evidence approach.

99. As the matter evolved in hearing, the relevant components of the valuation evidence concerning the different rates per square metre for different underlying land zonings and uses contended by the valuation expert witnesses is that evidence upon which I propose to focus.

100. It is well established that, if comparable sales are available, the direct comparison of sales evidence approach is the conventional method of valuation. The process of undertaking a valuation using this approach comprises several steps, including the accumulation, analysis, adjustment and application of potentially genuinely comparable sales (Adams v Valuer General [2014] NSWLEC1005 at [28]-[58]).

101. Concerning land with an underlying zoning of R2 Low Density Residential, Mr Phippen accumulated and analysed 14 sales considered comparable to the subject property (Exhibit A, Tab 11, pages 429-442) and adjusted for time, location, size and service delay (Exhibit A, Tab 11, pages 456-448) to derive a range of $260-$398 per square metre for the subject property (Exhibit A, Tab 11, page 443), with an emphasis on exchanged contracts (but not settled sales) at 25 Glengarrie Road, Marsden Park (adjusted rate $280 per square metre) and 51 Glengarrie Road, Marsden Park (adjusted rate $293 per square metre).

102. From these comparable sales, Mr Phippen asserted a rate of $280 per square metre for application to the subject property assuming no electricity easement, which he then subjectively reduced by 10% “as being land beside an easement, and from which the stanchions and power lines are clearly visible” to give a rate of $252 per square metre for land “beside the electricity easement”, subjectively reduced by a further 30% to $176 per square metre for land “within the electricity easement” (Exhibit A, Tab 11, pages 452).

103. Mr Phippen included a number of R3-zoned properties within his comparable sales. Given the agreement between the town planners that the underlying zoning should be regarded as R2 and a significant lack of divergence between Mr Phippen and Mr Good on the valuation of the non-TLE R2 land value, it is unnecessary to explore, further, this aspect of Mr Phippen’s valuation evidence.

104. However, in the Joint Valuation Report (Exhibit A, Tab 12), Mr Phippen changed his valuation, without explanation, for R2 Low Density Residential “outside the TLE” from $252 per square metre to $250 per square metre and for R2 “within the TLE” from $176 per square metre to $100 per square metre (Exhibit A, Tab 12, page 5) reflecting a discount of 60% from $250 per square metre (13 April 2016, T151, 153).

105. Whilst the adjustment for the R2 value by $2 per square metre, I assume, merely reflects rounding, he provided no clear explanation for the basis upon which he undertook his second adjustment of the R2 underlying zoned land within the TLE from $176 per square metre to $100 per square metre. However, for the reasons that are dealt with later, it is appropriate to accept this rate as being appropriate for the land within the TLE.

106. Concerning land that I now have held had an underlying zoning of E2 Environmental Conservation, Mr Phippen asserted, without explanation, a rate of $125 per square metre “outside the TLE” and $87.50 per square metre “within the TLE” in the joint report (Exhibit A, Tab 12, page 5), though observing, in oral evidence, that the latter represented an unexplained discount of 65% from $250 per square metre (13 April 2016, T162-163).

107. My finding on how to address the rate proposed for the E2 Environmental Conservation land in the western area of the site in response to this evidence from Mr Phippen is set out later.

Mr Good’s evidence on behalf of the Respondent

108. Mr Good assessed the market value under s 55(a) to be $14,220,000 on the basis of an underlying R2 Low Density Residential zoning or $6,330,000 on the basis of an underlying E2 Environmental Conservation zoning (Exhibit A, Tab 10, page 33), adopting the direct comparison of sales evidence approach.

109. Concerning land with an underlying zoning of R2 Low Density Residential, Mr Good accumulated and analysed nine sales considered comparable to the subject property (Exhibit A, Tab 10, pages 20-25) and made adjustment to one sale for deferred settlement (Exhibit A, Tab 10, page 21) to derive a range of $150-$318 per square metre for the subject property (Exhibit A, Tab 10, pages 20 to 25), with reliance on a deferred settlement sale at 73 Glengarrie Road, Marsden Park (adjusted rate $230 per square metre) which was further adjusted for date of sale to derive a rate of $210 per square metre.

110. Based on the comparable sale of the land to the north (at 73 Glengarrie Road, Marsden Park), Mr Good asserted, without explanation, a rate of $210 per square metre for application to that portion of the subject property not subject to the easement, from which he then further subjectively deducted 67.67%, due to the location of the easement on the subject property (13 April 2016, T129), to give a rate of $70 per square metre for land “affected by the TLE” (Exhibit A, Tab 10, page 32). I am satisfied (as later reflected in the valuers’ agreed position) that this is a little low.

111. However, in the Joint Valuation Report (Exhibit A, Tab 12), Mr Good changed his valuation, with limited explanation, for R2 Low Density Residential “outside the TLE” from $210 per square metre to $240 per square metre and for R2 Low Density Residential “within the TLE” from $70 per square metre to $80 per square metre. (Exhibit A, Tab 12, page 5).

112. As a consequence, particularly with respect to the valuation of land found to be R2 Low Density Residential outside the TLE, the valuation gap between Mr Phippen and Mr Good had narrowed to $10 per square metre. This narrowing was the subject of questioning of Mr Good by Mr Hemmings.

113. Concerning land with an underlying zoning of E2 Environmental Conservation, Mr Good accumulated and analysed nine sales of encumbered land (Exhibit A, Tab 1, page 20, 25 to 29) without adjustment to derive a range of $52.50 to $73.00 per square metre for the subject property from which Mr Good asserted a rate of $70.00 per square metre for application (Exhibit A, Tab 10, page 31).

114. However, in the Joint Valuation Report (Exhibit A, Tab 12), Mr Good changed his valuation, with limited explanation, for E2 Environmental Conservation from $70 per square metre to $80 per square metre. (Exhibit A, Tab 12, page 5).

115. Whilst this narrowing between Mr Phippen and Mr Good on the E2 Environmental Conservation land value narrowed somewhat, there remained, finally, the distinction between them at the conclusion of the oral evidence, that Mr Phippen had conceded that the E2 land in the western area should be no more than $100 per square metre and that it might be less. In the final analysis, as later discussed, it is appropriate to adopt $80 per square metre for this land in the western area in light of the agreement that this was appropriate.

Summary of the final position of the valuers

116. The table below sets out, from the oral and written evidence given by Mr Phippen and Mr Good, how they are to be used, the final competing values depending on the underlying zoning determination and, for the western area, what might be the possibility of the up-zoning if E2 were to be found to be the correct underlying zoning:

Zoning	Land	Mr Phippen	Mr Good
R2	“outside the TLE”	$250.00 psm	$240.00 psm
R2	“within the TLE”	$100.00 psm	$80.00 psm
E2	“outside the TLE”	$125.00 psm	$80.00 psm
E2	“within the TLE”	$87.50 psm	$80.00 psm

Conclusion on R2 values

117. However, in the course of his oral evidence, Mr Good conceded that, in circumstances where there was a comparatively narrow difference between two valuers on a particular valuation (as is here the case with the adjusted values derived by Mr Phippen and Mr Good for the R2 land both outside the TLE and within it), whilst minds might differ, it was possible that either value might realistically have been accepted.

118. In light of this, Mr Hemmings submitted it is appropriate that I follow Sydney Water Corporation v Caruso and Ors [2009] NSWCA 391; 170 LGERA 298 and, in such circumstances, adopt the valuation which is beneficial for the owner of the land which has been acquired compulsorily. It is clear from the discussion by Tobias JA, from [97], that such an approach is available (the comments by Allsop P on the scope of his Honour’s approach not being here engaged). I agree, in light of the narrowness of the gaps between the valuers on this point and Mr Good’s concession set out above, that I should take this approach on this element.

119. As can be seen from the table of the final positions of the valuers, Mr Good adopted the position that the value for the R2 land within the TLE should be the same rate per square metre as that applied to any land I considered should be regarded as having an underlying zoning of E2. It is self-evident, from the agreed position with respect to the development potential (albeit limited) of the land within the TLE (because of it having an underlying zoning of R2), that the value for such R2-zoned land could not be the same as that for E2-zoned land – given the fact that there is very limited development potential within the E2 land. I am satisfied, on this basis, that Mr Phippen’s proposed valuation for the R2 land within the TLE is appropriate.

120. I therefore adopt, for the R2 land to the east of the TLE, the rate of $250 per square metre and that for the R2 land, within the TLE, of $100 per square metre.

The value of the E2 land

121. I now turn to consideration of what value should be adopted for the area in the western portion of the land acquired from Mr Constantine, the area where I am satisfied that the underlying zoning should be E2 and where, I am satisfied, there is no realistic prospect of up-zoning (absent the public purpose). Mr Phippen’s valuation, in his final analysis, was that the E2 land outside the TLE should have a higher value than the R2 land valuation within the TLE.

121. For the reasons noted above, concerning the comparative development potential of the two underlying zonings, this is clearly an untenable position. There was no adequate explanation as to how such an inherently contradictory position could be adopted. On one of the scenarios advanced by Mr Hemmings, the appropriate value for any E2 underlying zoned land would commence at $80 per square metre, the rate proposed by Mr Good, rather than the contradictory rate initially adopted by Mr Phippen.

122. Although, as earlier noted, there are no specifically comparable sales and the valuers both cast their eyes wider to seek assistance, I have not found those unrelated sites to be of assistance. However, given my adoption of the rate proposed by Mr Phippen for the within the TLE land with an underlying R2 zoning, the value of $80 per square metre proposed by Mr Good for this land is not unreasonable.

Conclusion on valuation outcomes

124. On the basis of the above valuation conclusions and my earlier conclusions that the appropriate zonings are R2 (eastern area + TLE) and E2 (western area), the table below sets out the relevant valuation calculations and resultant total valuation outcome:

Area (m2)	Value (m2) $	Total $
R2 East	1,924	250	$481,000
TLE as R2	28,299	100	$2,829,900
E2 West	56,350	80	$4,508,000
Total			$7,818,900

The contested “disturbance” claim

125. A person whose land is compulsorily acquired for a public purpose is entitled, pursuant to s 59 of the Land Acquisition Act, to be reimbursed for a range of expenses incurred in the process of addressing the quantum of compensation to be paid for that acquisition. This provision is in the following terms:

59 Loss attributable to disturbance

(1) In this Act:

"loss attributable to disturbance" of land means any of the following:

(a) legal costs reasonably incurred by the persons entitled to compensation in connection with the compulsory acquisition of the land,

(b) valuation fees of a qualified valuer reasonably incurred by those persons in connection with the compulsory acquisition of the land (but not fees calculated by reference to the value, as assessed by the valuer, of the land),

(c) financial costs reasonably incurred in connection with the relocation of those persons (including legal costs but not including stamp duty or mortgage costs),

(d) stamp duty costs reasonably incurred (or that might reasonably be incurred) by those persons in connection with the purchase of land for relocation (but not exceeding the amount that would be incurred for the purchase of land of equivalent value to the land compulsorily acquired),

(e) financial costs reasonably incurred (or that might reasonably be incurred) by those persons in connection with the discharge of a mortgage and the execution of a new mortgage resulting from the relocation (but not exceeding the amount that would be incurred if the new mortgage secured the repayment of the balance owing in respect of the discharged mortgage),

(f) any other financial costs reasonably incurred (or that might reasonably be incurred), relating to the actual use of the land, as a direct and natural consequence of the acquisition.

(2) Subject to the regulations, a reference in this section to a

"qualified valuer" is a reference to a person who:

(a) has membership of the Australian Valuers Institute (other than associate or student membership), or

(b) has membership of the Australian Property Institute (other than student or provisional membership), acquired in connection with his or her occupation as a valuer, or

(c) has membership of the Royal Institution of Chartered Surveyors as a chartered valuer, or

(d) is of a class prescribed by the regulations.

126. In this instance, there is a dispute concerning elements of the claim made by Mr Constantine for reimbursement of these expenses. A schedule of the amounts claimed (and the invoices relied upon as supporting those claims) was contained in a bundle of documents that became Exhibit D.

127. The total amount claimed for reimbursement is $60,597.88, of which, as I understood Mr Galasso's submissions, the sum of $23,936.11 is contested. The contested amount comes from three disciplines necessarily engaged in these proceedings, these being lawyers, valuers and ecological experts. The disputed claims are:

• The cost of the legal services provided by the first firm of lawyers (PC Law) engaged by Mr Constantine for the purposes of these proceedings;

• The cost of the valuation report from the first valuer (Edmonds Associates) engaged by Mr Constantine;

• The cost of the first ecologist’s (Abel Ecology) report prepared for Mr Constantine; and

• The costs of work by the second valuer (Abbotts Valuers) after their initial valuation report.

128. Each of these disputes requires separate consideration as the basis of objection differs in each instance.

129. I turn, first, to the claim for the expenses of the first firm of lawyers whose services were engaged by Mr Constantine. The amount in dispute under this heading is $6,116.00. The first services provided by these lawyers, as disclosed on their invoice, was on 4 June 2013, whilst the last day of their services invoiced was 9 December 2013.

130. The principal of this firm wrote to Mr Constantine on 23 December 2013 and informed him that, from that date, the firm was to cease trading and could no longer provide legal services to Mr Constantine in this matter. The letter advising Mr Constantine of this position was Exhibit E. The relevant paragraph in the letter was in the following terms:

1) For reasons beyond our control PC Law Pty Ltd will be ceasing operations and will no longer be able to act for you. We understand this will cause you significant disruption and we apologise for this.

131. Mr Constantine engaged a new firm of solicitors, CBP Lawyers, to act on his behalf. The partner of that firm, Mr Perkins, continues to represent Mr Constantine as his solicitor in these proceedings, although now at a different firm.

132. The invoices for each set of services were provided to me as part of Exhibit E. The invoices, as might be expected, itemise the individual activities for which each firm has charged Mr Constantine. As is also conventionally the position, the description of the service provided is in brief terms, being sufficient for a quick understanding of the nature of the activity but not providing vast, discursive detail of what was undertaken.

133. I have not undertaken a detailed tracking analysis to endeavour to ascertain whether any individual item on the invoices for Mr Constantine’s second solicitors appears to be sufficiently precisely identified as to be able to be compared with and regarded as a duplication of some similar item on the invoice from his first solicitors.

134. However, a broad examination of the activities of the two firms appears to show that, apart from some minor introductory work required by Mr Perkins’ firm to get up to speed with the file, there is no such duplication. In addition, the totality of the amounts invoiced across the two firms does not appear to be manifestly unreasonable, given the extent of the complexity of the matters arising concerning this acquisition.

135. I also observe that there is no suggestion that the necessity for Mr Constantine engaging new legal representatives arose as a consequence of any dispute between Mr Constantine and the first firm of solicitors. The earlier quoted passage from Exhibit E makes it clear that the cessation of acting for Mr Constantine was not personal but was a both unilateral and universal cessation of trading by his first legal advisers.

136. Under all those circumstances, the totality of the legal expenses claimed should be allowed pursuant to s 59(a) of the Land Acquisition Act.

137. I now turn to the claims for the provision of valuation advice. The valuation advice provided to Mr Constantine came from two firms of valuers. The first column set out in the disturbance claim schedule, that for Abbotts Valuers, is in fact for services provided second in time - services provided subsequent to those provided by the first valuers engaged for Mr Constantine, Edmonds Associates.

138. Although the claim is presented in this order, it is more appropriate, in light of Mr Galasso's submissions, to deal with them in the temporal order in which their expenses were incurred.

139. The amount claimed for a valuation report prepared by Edmonds Associates is $2,200.00. The invoice for these valuation services was in Exhibit D at Tab 4. This invoice was rendered on 5 May 2014.

140. Although Mr Hemmings initially submitted that the engagement of a second valuer in a claim of this size would not be unusual, as a check valuation would be appropriate (14 April 2016, T236, lines 46-50), I am unable to accept that this position applies with respect to this valuation activity.

141. This valuation report is first in time and, therefore, could not be described as having been commissioned for check valuation purposes. This valuation report is not in evidence and is not relied upon for the purpose of the contest before me.

142. However, an examination of the legal accounts from CBP Lawyers shows that the lawyers did not appear to engage with this document as part of the legal assistance provided to Mr Constantine during the preparation for acquisition process. On balance, it seems to me that there is no sufficient basis for me to accept this element of the disturbance claim. Thus, the claim for $2,200.00 for the first valuation report is disallowed.

143. The second valuation work undertaken for Mr Constantine involved utilisation of the services of Mr Phippen, the valuer who has given evidence on Mr Constantine’s behalf in these proceedings, and those staff of Abbotts Valuers who have provided support to him.

144. As I understood Mr Galasso's objection to this element of the disturbance claim, it is to those elements for which invoices have been rendered subsequent to the activities that led up to and included the provision of the initial valuation report provided by Abbotts Valuers. The objection is to the claim for activities undertaken by Abbotts Valuers subsequent to the provision of this report. As a consequence, of the total of $19,443.49 claimed with respect to work undertaken by Abbotts Valuers, the disputed component comprises $10,890.11. The invoices for these disputed amounts form part of Exhibit D behind Tab 3. The invoices for these activities describe the activities as encompassing work that can generally be described in the following terms:

“Additional services as recorded on time sheet”, together with mileage and travel time.

145. An examination of the relevant elements of the solicitors’ invoices coinciding with the period covered by these two invoices demonstrates a degree of linkage between the valuation and legal services’ activities. As a consequence, the amount claimed for these elements of the Abbotts Valuers’ invoices should be allowed on the basis that they are sufficiently related to, and forming part of, the necessary preparation for dealing with the acquisition process.

146. The final disputed disturbance element relates to the claim for reimbursement of $4,730.00 for the cost of a report by Abel Ecology Consultants. The relevant invoice is in Exhibit D behind Tab 5. It discloses that these services and report were provided in the period ending 17 March 2015 (the date of the invoice).

147. The relevant specific provision of the Land Acquisition Act, s 59, makes provision for specific reimbursement of various costs incurred by an owner of land acquired for a public purpose.

148. The claim for reimbursement of the costs of the ecological report provided by the consultants, Abel Ecology, is said, in the schedule of items set out in the schedule at the commencement of Exhibit D, to arise pursuant to s 59(b) of the Land Acquisition Act. This provision has been set out at the commencement of this section. The provision makes it clear that claims under this heading are for the costs of utilising the services of a valuer as part of the acquisition process (including, it is to be noted, the negotiation process prior to formalisation of the acquisition). Indeed, to ensure that claims made pursuant to this subsection are precisely confined, those who can be regarded as “valuers” for the purposes of s 59(b) are set out in s 59(2), with only those persons satisfying one of the bases there listed being able to provide a foundation for a claim for reimbursement for the engagement of a qualified valuer.

149. Mr Galasso’s submissions resisting the claim for reimbursement of the costs of the Abel Ecology report were based on the lack of connection between the Abel Ecology report and the acquisition process.

150. Arising out of my consideration of the disturbance claim and my inclination to disallow the cost of the Abel Ecology report for the statutory reasons set out above, I had my Associate e-mail the solicitors for the parties to invite submissions on this point. That request indicated that any submissions on behalf of Mr Constantine should be filed and served by the close of business on Wednesday 27 April 2016, whilst, if such submissions were made, any submissions in reply on behalf of the Council were to be filed and served by the close of business on Wednesday 4 May 2016.

151. The response for Mr Constantine was that there had been a misdescription of the claim and it should have been characterised as being made under s 59(f).

152. Now treating this element of the claim in this new fashion, it is appropriate to repeat the terms of s 59(1)(f), a provision which reads:

(f)  any other financial costs reasonably incurred (or that might reasonably be incurred), relating to the actual use of the land, as a direct and natural consequence of the acquisition.

153. The written submission for Mr Constantine on this point relied on a passage in the decision of Lloyd J in Fitzpatrick Investments Pty Limited v Blacktown City Council (No 2) [2000] NSWLEC 139; 108 LGERA 417 at [20], where his Honour said:

Paragraph (f) of section 59 is wider than the preceding paragraphs. It is a “catch-all” provision: “any other financial costs reasonably incurred (or that might reasonably be incurred) relating to the actual use of the land, as a direct and natural consequence of the acquisition”. As a “catch-all” provision, the words “any other financial costs” should not, in my opinion, be read down.

154. However, it is also instructive to repeat the remainder of the paragraph, as it adds a significant rider to the more expansive view I am encouraged by the submission to take. His Honour continued:

This does not mean, however, that this paragraph opens the flood-gates. The costs must be “reasonably incurred” and must relate to the actual use of the land, as a direct and natural consequence of the acquisition.

155. As Mr Galasso pointed out, in effect, in his reply submissions on this point, it is necessary to consider whether the report relates “to the actual use of the land” as required by the statute.

156. In Mir Bros Unit Constructions Pty Ltd v Roads & Traffic Authority of New South Wales [2006] NSWCA 314, Spigelman CJ said, in [88], inter alia:

Disturbance costs may only be awarded under s59(f) for costs “relating to the actual use” of the acquired land. In Blacktown City Council v Fitzpatrick Investments Pty Ltd [2001] NSWCA 259, Stein JA held that “something which is only a potential future use would fall short of ‘actual use’” (at [5]). To similar effect, Brownie AJA, with whom Ipp AJA (as his Honour then was) agreed, accepted a submission that the word “actual” was used to distinguish such use from a potential use (at [26]–[27]).

157. It is in this context that I turn to an examination of the reimbursement claim for the Abel Ecology report.

158. It is clear from an examination of the relevant portion of the solicitors’ invoices that this report was provided to the Valuer-General as part of the negotiation between Mr Constantine’s representatives and the Valuer-General seeking to resolve the compensation dispute without the necessity for proceeding to a contested hearing.

159. The Abel Ecology report was dated 15 April 2015. On 20 April 2015, Mr Constantine’s solicitors forwarded a copy of the report to the firm of consultant valuers retained on behalf of the Valuer-General to assess the compensation claim. The letter from Mr Constantine’s solicitors to the Valuer‑General's consultant valuers said, with respect to this report:

You previously raised concerns regarding possible ecological constraints on the subject property. Please find attached the flora and fauna report prepared by Abel Ecology, dated 15 April 2015. The report concludes that there are no ecological factors which would constrain the future development potential of the subject property.

160. The executive summary in the Abel Ecology report itself says, inter alia:

The aim of the assessment is to survey the site and determine the status and condition of the vegetation and fauna habitat in relation to endangered communities, and threatened, protected or endangered flora and fauna as described by the Office of Environment and Heritage (OEH). This assessment will inform the development potential of the site, assuming the site had an underlying zoning of R2 Low Density Residential under the SEPP.

161. The report of the consultant valuers retained on behalf of the Valuer-General, dated 4 June 2015, discussed both the Abel Ecology report and the review of it commissioned from an environmental scientist employed by GHD.

162. The report from the GHD environmental scientist is dated 1 June 2015. It is clear from a reading of this report that not only was it prepared in response to the Abel Ecology assessment, but that it also dealt with broader ecological constraint considerations. However, to the extent that it dealt with the Abel Ecology assessment, page 10 of the GHD report makes it clear that, in an engaging with the Abel Ecology assessment, it was to deal with potential future uses rather than any actual current use.

163. It is also clear from the discussion on pages 24 to 26 of the resultant valuation assessment that the report of the GHD environmental scientist, to the extent it dealt with the Abel Ecology report, was considered by the valuers in the context of potential future use of the site rather than its current actual use.

164. As a consequence, this claim should also be disallowed.

165. In totality, therefore, the disputed disturbance allowance claims, except for the $2,200.00 for the Edmonds Associates’ valuation services and $4,730 for the Abel Ecology report, are resolved in favour of Mr Constantine, resulting in a total of $53,667.88 being allowed.

Conclusion

166. Accepting that the eastern land should be regarded as having an underlying R2 Low Density zoning, I have accepted Mr Phippen’s valuation of $250 per square metre for this area. This gives a value for the acquired eastern portion of $481,000.

167. With respect to the land within the TLE which has an agreed underlying R2 zoning as well, I adopt the rate of $100 per square metre for this land, giving a resultant valuation for it of $2,829,900.

168. For the area to the west of the TLE, I have concluded that the underlying zoning should be E2 Environmental Conservation and I have explained why I reject the proposition that this land should be valued as having, absent the public purpose, any realistic prospect of being up-zoned from E2 to R2 Low Density Residential. As a consequence, accepting (as I do) Mr Good’s valuation evidence for this purpose, the value to be ascribed to this land is $80 per square metre, giving a valuation for this portion of $4,508,000.

169. Therefore, the total compensation to be paid to Mr Constantine for the value of the land acquired from him is $7,818,900.

170. I have also concluded that, with the exception of the Edmonds Valuers’ report and the Abel Ecology report, Mr Constantine is entitled to be reimbursed for disturbance claims under s 59 of the Land Acquisition Act in the sum of $53,667.88.

166. Costs are to be reserved.

167. The parties are to provide settled Short Minutes of Order to my Associate by the close of business on 27 July 2016 reflecting the outcome of my determination.

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Decision last updated: 06 July 2016