Crighton Properties Pty Ltd v Kiama Municipal Council

[2006] NSWLEC 297

Reported Decision: (2006)146 LGERA 271

Land and Environment Court

of New South Wales

CITATION:

Crighton Properties Pty Limited v Kiama Municipal Council [2006] NSWLEC 297

PARTIES:

APPLICANT
Crighton Properties Pty Limited

RESPONDENT
Kiama Municipal Council

FILE NUMBER(S):

40119 of 2006

CORAM:

Preston CJ

KEY ISSUES:

Judicial Review :- council decision to reject development application pursuant to cl 51(1) of the Environmental Planning and Assessment Regulation 2000 on the basis that the application was not accompanied by documents specified by cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation as required by cl 50(1) - cl 2(1)(h) requires documents if an environmental planning instrument requires arrangements for any matter to have been made before development consent granted - whether cll 27(1) and 74(1) of SEPP (Seniors Living) such an environmental planning instrument - cll 27(1) and 74(1) require consent authority to be satisfied that certain services will be provided, not that arrangements have been made - cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation not applicable - council's decision to reject development application ultra vires.

LEGISLATION CITED:

Environmental Planning and Assessment Act 1979 (NSW), 78A(1), 78A(9)
Environmental Planning and Assessment Regulation 2000 cl 50(1), cl 50(3), cl 51(1), Sch 1 Pt 1 cl 2(1)(h)
State Environmental Planning Policy (Seniors Living) 2004 cl 27(1), cl 27(2), cl 74(1)

CASES CITED:

Codlea Pty Ltd v Byron Shire Council (1999) 105 LGERA 370

DATES OF HEARING:

22/05/2006

EX TEMPORE JUDGMENT DATE:

05/22/2006

LEGAL REPRESENTATIVES:

APPLICANT
Mr M G Craig QC with Mr M Seymour
SOLICITORS
Tesoriero Henerson Cotter

RESPONDENT
Mr J A Ayling SC
SOLICITORS
Kearns & Garside with RMB Lawyers

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

PRESTON CJ

22 MAY 2006

40119 OF 2006

CRIGHTON PROPERTIES PTY LTD V KIAMA MUNICIPAL COUNCIL

JUDGMENT

1 HIS HONOUR: The making of a development application to a consent authority is the trigger to enliven the power of the consent authority to determine the development application under the Environmental Planning and Assessment Act 1979 (“the Act”).

2 In this case, the parties are at issue as to whether a development application has been made. The applicant, Crighton Properties Pty Limited, says that it has made a development application to the respondent, Kiama Municipal Council (“the Council”), as the relevant consent authority, to develop land for the purpose of providing accommodation for seniors pursuant to State Environmental Planning Policy (Seniors Living) 2004 (“SEPP (SL)”).

3 The Council says that, although the development application was received by the Council, it rejected the development application pursuant to cl 51(1) of the Environmental Planning and Assessment Regulation 2000 (“the Regulation”) with the consequence that the development application is taken for the purposes of the Act never to have been made (cl 51(3) of the Regulation).

4 The issue, therefore, is whether the Council was entitled to reject the development application under cl 51(1) of the Regulation. If it was, the development application is taken to have never been made, but if not, then the Council’s rejection would be outside power and ineffective with the consequence that the development application would still be on foot and have been made.

5 The applicant has brought these proceedings to resolve this issue. The applicant seeks a declaration that the development application it lodged with the Council has been validly made under the Act and consequential mandatory injunctive relief that the Council process and determine the development application in accordance with the Act.

Lodging the development application

6 Section 78A(1) of the Act provides:

“A person may, subject to the regulations, apply to a consent authority for consent to carry out development.

7 Section 78A(9) of the Act provides:

“The regulations may specify other things that are required to be submitted with the development application.

8 The relevant regulation is Environmental Planning and Assessment Regulation 2000. Clause 50(1) of the Regulation provides:

“(1) A development application:

(a) must contain the information, and be accompanied by the documents, specified in Part 1 of Schedule 1, and
(b) if the consent authority so requires, must be in the form approved by that authority, and
(c) must be accompanied by the fee, not exceeding the fee prescribed by Part 15, determined by the consent authority, and
(d) must be delivered by hand, sent by post or transmitted electronically to the principal office of the consent authority, but may not be sent by facsimile transmission.”

9 On 12 December 2005, the applicant lodged with the Council a development application for the seniors living development. The development application:

(a) was in the form approved by the Council (cl 50(1)(b) of the Regulation);

(b) was accompanied by the required fee (cl 50(1)(c) of the Regulation); and

(c) was delivered by hand to the principal office of the Council (cl 50(1)(d) of the Regulation).

Prescribed information and documents

10 As noted above, cl 50(1)(a) of the Regulation requires a development application to contain the information and be accompanied by the documents specified in Pt 1 of Sch 1 of the Regulation.

11 Part 1 of Sch 1 of the Regulation specifies, in para 1, the information to be included in the development application, and in para 2 the documents to accompany the development application.

12 It is common ground between the parties that the applicant’s development application lodged on 12 December 2005 contained the information required by para 1 of Pt 1 of Sch 1, to be included in the development application.

13 The Council has not put in issue that the applicant’s development application lodged on 12 December 2005 was not accompanied by the documents required by para 2 of Pt 1 of Sch 1 to accompany the development application, with one exception. The Council contends that the development application was required to be accompanied by, but was not in fact accompanied by, documentary evidence required by cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation. This clause requires:

“(1) A development application must be accompanied by the following documents:

...
(h) if an environmental planning instrument requires arrangements for any matter to have been made before development consent may be granted (such as arrangements for the provision of utility services), documentary evidence that such arrangements have been made.”

14 It can be seen that before cl 2(1)(h) is applicable, there must be an environmental planning instrument which applies to the development application and which requires arrangements for any matter to have been made before development consent may be granted. The Council contends that SEPP (SL) is such an environmental planning instrument. The applicant disagrees.

15 The applicant contends that cl 2(1)(h) was not applicable to the development application and hence documentary evidence of arrangements of the kind referred to in cl 2(1)(h) was not required to accompany the development application.

16 This is the critical point on which this case turns. I will return to it shortly.

17 Alternatively, the applicant submits that the development application was accompanied by documentary evidence establishing the matters referred to in cl 27(1) and 74(1) of SEPP (SL). The documentary evidence was in the statement of environmental effects that accompanied the development application. The matters of water and sewerage referred to in cl 27(1) were addressed at pp. 13-16 of the statement of environmental effects and the annexed report by Patterson Britten, particularly at pp. 1, 2 and 9. The matters of services to be provided to residents of the proposed developments, referred to in cl 74(1), were addressed at pp. 4-5 and 22 of the statement of environmental effects, and the annexed social impact assessment report by BBC Planning, particularly at pp. 3, 4, 5, 33 and 51.

18 This documentary evidence did not establish an arrangement in the sense of an understanding between the applicant and external persons or statutory authorities, but did establish that the relevant services would be provided to the development and residents of the development if approved.

Receiving the development application

19 Clause 50(3) of the Regulation provides:

“(3) Immediately after it receives a development application, the consent authority:

(a) must register the application with a distinctive number, and
(b) must endorse the application with its registered number and the date of its receipt, and
(c) must give written notice to the applicant of its receipt of the application, of the registered number of the application and of the date on which the application was received.”

20 On 12 December 2005, the Council wrote to the applicant giving written notice pursuant to cl 50(3)(c) that:

(a) the development application has been received by the Council;
(b) the registered number of the development application was 10.2005.418.1; and
(c) the date on which the development application was received was 12 December 2005.

Rejecting the development application

21 Clauses 51(1) and 51(2) of the Regulation provide for the rejection of a development application within specified time periods if certain circumstances therein stated exist. Of relevance to this case is cl 51(1)(b) of the Regulation which provides:

“(1) A consent authority may reject a development application within 7 days after receiving it if:

(b) the application does not contain any information, or is not accompanied by any document, specified in Part 1 of Schedule 1.”

22 Clause 51(3) of the Regulation states the consequence of a rejection of a development application under cll 51(1) or 51(2), namely:

“(3) An application that is rejected under this clause is taken for the purposes of the Act never to have been made.”

23 Clause 51(4) of the Regulation requires the consent authority to refund the applicant the whole of any application fee paid in connection with an application that is rejected under cl 51.

24 On 19 December 2005, the Council wrote to the applicant rejecting the applicant’s development application. The Council’s letter of 19 December 2005 states:

“I refer to your application for a development proposal on the land referred to above. Council is unable to accept the development application in its present format, and hereby rejects your application pursuant to Section 78A of the Environmental Planning and Assessment Act 1979, and Clause 51(1)(b) of the Environmental Planning and Assessment Regulation 2000.

The application has been rejected as the application was not accompanied by the information required by Clause 2(1) of Part 1 of Schedule 1 of the Environmental Planning and Assessment Regulation 2000 which requires certain documents to accompany a development application. Specifically Clause 2(1)(h) states that:

‘If an environmental planning instrument requires arrangements for any matter to have been made before development consent may be granted (such as arrangements for the provision of utility services), documentary evidence that such arrangements have been made.’


Clause 27(1) of the SEPP (Seniors Living) requires that: ‘A consent authority must not consent to a development application made pursuant to this Chapter, unless the consent authority is satisfied, by written evidence, that the housing will be connected to a reticulated water system and have adequate facilities for the removal or disposal of sewage.’ The application was not accompanied by written evidence that the housing will be connected to a reticulated water system and have adequate facilities for the removal or disposal of sewage.

Further, Clause 74(1) of the SEPP (Seniors Living) states: ‘A consent authority must not consent to a development application made pursuant to this Chapter to carry out development for the purpose of serviced self-care housing on land that adjoins land zoned primarily for urban purposes unless the consent authority is satisfied, by written evidence, that residents of the proposed development will have reasonable access to:
(a) home delivered meals, and
(b) personal care and home nursing, and
(c) assistance with housework.’


Insufficient written evidence was provided in this regard.

Pursuant to Clause 51(3) of the Environmental Planning and Assessment Regulation 2000, an application that is rejected under this clause, is taken for the purposes of the Act never to have been made.

Please find enclosed your development application, supporting documentation and cheques...”

25 The Council’s letter of rejection was within the 7 day period specified in cl 51(1) of the Regulation.

Entitlement to reject the development application: the competing arguments

26 Mr J Ayling SC, for the Council, submitted that the Council was entitled to reject the applicant’s development application under cl 51(1)(b) of the Regulation. The Council submitted that the applicant’s development application was not accompanied by the documents required by cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation. The Council submitted that cll 27(1) and 74(1) of SEPP (SL), on a proper construction, require that arrangements have been made, firstly, that the housing will be connected to a reticulated water system and will have adequate facilities for the removal or disposal of sewage (cl 27(1)) and, secondly, that residents of the proposed development will have reasonable access to home delivered meals, personal care and home nursing, and assistance with housework (cl 74(1)).

27 In so contending, the Council submitted that the word “arrangements” in cl 2(1)(h) is not limited to understandings between two or more persons, as was held by the Court of Appeal in Codlea Pty Ltd v Byron Shire Council (1999) 105 LGERA 370 at 378 [39] and [40]. Arrangements would also extend to a state of affairs already in existence (such as where services have already been provided) or to a unilateral proposal by the applicant for consent in the development application to take steps that would necessarily result in the provision of services. When the word “arrangements” in cl 2 (1)(h) is viewed this widely, cll 27(1) and 74(1) can be seen to require such arrangements.

28 SEPP (SL) is therefore, on the Council’s submission, an environmental planning instrument that requires arrangements for any matter to have been made before development consent may be granted, within the meaning of the opening words of cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation. Hence, the Council contends, the development application was required by cl 2(1)(h) to be accompanied by documentary evidence that such arrangements had been made. As the development application was not accompanied by such documentary evidence, the Council was entitled under cl 51(1)(b) of the Regulation to reject the development application.

29 Mr Craig QC, with him Mr M Seymour, appearing for the applicant, submitted that the Council’s construction of SEPP (SL) is incorrect. Neither cl 27(1) nor cl 74(1) of SEPP (SL) require “arrangements for any matter to have been made before development consent may be granted.”

30 “Arrangements” in the context of cl 2(1)(h) means an understanding between two or more persons, as held by the Court of Appeal in Codlea Pty Ltd v Byron Shire Council (1999) 105 LGERA 370 at 378 [39] and [40]:

“39. The ‘arrangements’ referred to in cl 45 are arrangements in the sense explained in Commissioner of Taxation (Cth) v Newton (1957) 96 CLR 577, in particular Williams J at 630-631 and Newton v Commissioner of Taxation (Cth) (1958) 98 CLR 1 at 7, wherein the Privy Council said:
‘Their Lordships are of the opinion that the word ‘arrangement’ is apt to describe something less than a binding contract or agreement, something in the nature of an understanding between two or more persons, a plan arranged between them which may not be enforceable at law.’

40. The parties seem agreed, and I think that it is the case, that the ‘arrangements’ referred to in cl 45 are Newton type arrangements. Talbot J described them as ‘at least, a willingness on the part of the relevant authorities to co-operate in a consensual way that may bring the scheme to fulfilment.’ I think that this is a reasonable way of putting it. Its essence is of course consensual and that is where the appellant faces a difficulty. It is true that the arrangements under cl 45 need not have been implemented. But they still have to exist and must pre-exist the ‘satisfaction’ of council with them. They are prior arrangements which have been made. And they must exist to council’s satisfaction prior to consent.”

31 The applicant submitted that the “draconian” consequence of an exercise of the power to reject a development application supports giving the word “arrangements” in cl 2(1)(h) this construction.

32 The applicant submitted that cll 27(1) and 74(1) do not refer at all to “arrangements”. That should be seen to be a deliberate drafting decision, as SEPP (SL) post-dates the Regulation. If the draftsperson had intended that cll 27(1) and 74(1) were to establish, as the requisite condition precedent to the granting of consent, that arrangements to provide the matters referred to in the clauses have been made, so as to fall within the ambit of cl 2(1)(h), the draftsperson would have expressly used the phrase, “arrangements have been made” in cll 27(1) and 74(1). The fact that the draftsperson did not use this phrase is an indication of the contrary intention.

33 The applicant also referred to the fact that cll 27(1) and 74(1) look to the provision of matters in the future, not the making of past arrangements. Clause 2(1)(h) requires a past state of events to have occurred before the Council is able to grant consent. By comparison, cll 27(1) and 74(1) speak in terms of some event to occur in the future. Clause 27(1) requires a consent authority to be satisfied that “the housing will be connected to a reticulated water system, and have adequate facilities for the removal and disposal of sewage.” Similarly cl 74(1) requires consideration of whether residents of the proposed development will have reasonable access to the nominated services.

34 Hence, the applicant submitted, cll 27(1) and 74(1) do not answer the description in cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation, of being an environmental planning instrument that requires arrangements for any matter to have been made before development consent may be granted.

35 Hence, the applicant submitted, cl 2(1)(h) does not apply and there was no need for the applicant’s development application to be accompanied by documentary evidence of any arrangements that have been made in relation to the matters referred to in cll 27(1) and 74(1) of SEPP (SL).

36 These competing arguments of the parties turn on the proper construction of SEPP (SL) and cll 27(1) and 74(1) in particular.

Proper construction of SEPP (SL)

37 The two clauses of SEPP (SL) in contention are cll 27(1) and 74(1). These clauses provide as follows:

“27(1) A consent authority must not consent to a development application made pursuant to this Chapter unless the consent authority is satisfied, by written evidence, that the housing will be connected to a reticulated water system and have adequate facilities for the removal or disposal of sewage
…

74(1) A consent authority must not consent to a development application made pursuant to this Chapter, to carry out development for the purpose of serviced self-care housing on land that adjoins land zoned primarily for urban purposes, unless the consent authority is satisfied, by written evidence, that residents of the proposed development will have reasonable access to:

(a) home delivered meals,

(b) personal care and home nursing,

(c) assistance with housework.”

38 These clauses each establish a condition precedent to the grant of consent by a consent authority. The condition precedent is the formation by the consent authority of an opinion of satisfaction, to be formed on the written evidence before it at the time, that the matters referred to in each of the clauses will be provided, namely:

· for cl 27(1), that the housing will be connected to a reticulated water system and have adequate facilities for the removal or disposal of sewage; and

· for cl 74(1), that the residents of the proposed development will have reasonable access to home delivered meals, personal care and home nursing, and assistance with housework.

39 The condition precedent required by cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation is that the environmental planning instrument require arrangements for any matter to have been made before development consent may be granted.

40 Do each of the conditions precedent established by cll 27(1) and 74(1) of SEPP (SL) answer this description of a condition precedent in cl 2(1)(h)? I am of the opinion that they do not answer that description for a number of reasons.

41 First, cll 27(1) and 74(1) do not in terms require that any “arrangements” for the matters referred to in each clause have been made before development consent may be granted. The word “arrangements” does not appear in either clause.

42 The word “arrangements” in cl 2(1)(h) bears, in my opinion, the meaning given by the Court of Appeal in Codlea Pty Ltd v Byron Shire Council (1999) 105 LGERA 370 at 378 [39] and [40]. That is to say, something in the nature of an understanding between two or more persons.

43 Clauses 27(1) and 74(1) of SEPP (SL) do not require any such understanding to have been made before development consent can be granted.

44 Secondly, the clauses do not require that “arrangements” have been made. Rather, the clauses require the consent authority to be satisfied that the matters referred to in the clauses “will” be provided. The clauses do not look to the past (namely that arrangements have been made) but to the future (that the matters referred to in the clauses will be provided).

45 Thirdly, the written evidence upon which the consent authority is to be satisfied as to the matters referred to in each clause, does not necessarily require proof of arrangements that have been made to provide for those matters. There may be a number of ways in which the written evidence may satisfy the consent authority that the matters referred to in the clauses will be provided.

46 Obviously, if an arrangement has actually been made to provide the matters referred to in the clauses, and written evidence of such arrangement is provided to the consent authority, that would be one way that the consent authority could be satisfied that the matters referred to in the clauses will be provided. However, that is not the only way the consent authority could be satisfied.

47 Another way would be for the written evidence that is supplied to the consent authority to state that, although arrangements in relation to the provision of the matters referred to in cll 27(1) and 74(1) have not yet been made, nevertheless such arrangements may be made in the future. This may be on some date specified or on or after the happening of some event, including the grant of development consent for the development.

48 Obviously, the more uncertain and contingent the making of arrangements in the future with external service providers for the provision of the matters referred to in cll 27(1) and 74(1) may be, the more difficult it may be for an applicant for development consent to satisfy the consent authority that the matters will be provided. This fact, however, does not remove the possibility that an applicant could satisfy a consent authority that the matters referred to in the clauses will be made, by providing written evidence that an arrangement in respect to matters will be made in the future, even though such an arrangement has not yet been made.

49 Yet another way of establishing that the matters referred to in cll 27(1) and 74(1) of SEPP (SL) will be provided may not involve the making of arrangements with external service providers at all, but instead may be for the development itself to provide the matters referred to in those clauses.

50 For example, in relation to cl 27(1), the proposed development may involve an onsite system for removal or disposal of sewage, or, perhaps less likely, a reticulated water system. Clause 27(2) contemplates such arrangements. The written evidence for such systems would be in the development application and accompanying documents. The consent authority could be satisfied by that written evidence that, if consent were to be granted, including with appropriate conditions requiring the ongoing provision and maintenance of the systems, the housing will be connected to a reticulated water system and have adequate facilities for the removal and disposal of sewage.

51 In relation to cl 74(1), the proposed development may involve provision to the residents of the proposed development of home delivered meals, personal care and home nursing, and assistance with housework by the management of the seniors living development. The written evidence would again be in the development application and accompanying documents. The consent authority could be satisfied by that written evidence that, if consent were to be granted including with appropriate conditions requiring the ongoing provision of such services, the services will be provided. Any arrangements for the provision of such services to residents would obviously have to be made with residents in the future after the development is carried out.

52 Accordingly, on a proper construction of cll 27(1) and 74(1) of SEPP (SL), the clauses do not, expressly or impliedly, require arrangements for the matters referred to in the clauses to have been made before development consent may be granted.

Applying the proper construction of SEPP (SL)

53 Clauses 27(1) and 74(1) of SEPP (SL) do not, therefore, fall within the description in cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation of being “an environmental planning instrument [that] requires arrangements for any matter to have been made before development consent may be granted.” As a consequence, cl 2(1)(h) is not triggered by cll 27(1) and 74(1) of SEPP (SL) and documentary evidence of arrangements for any matters under cll 27(1) or 74(1) of SEPP (SL) is not required to accompany a development application for a seniors living development.

54 The Council was not, therefore, entitled under cl 51(1)(b) to reject the applicant’s development application on the basis that the development application was not accompanied by documentary evidence of the kind referred to in cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation. The Council’s purported exercise of the power under cl 51(1)(b) was ultra vires.

55 The applicant is entitled to the declaratory relief it has sought in its class 4 application. In addition, I would add a declaration that the Council’s determination of 19 December 2005 to reject the applicant’s development application is void and of no effect.

56 The above conclusion does not, and is not intended to, affect:

(a) the necessity for the applicant to provide to the consent authority written evidence to enable the consent authority to be satisfied as to the matters referred to in cll 27(1) and 74(1) of SEPP (SL); or

(b) the necessity for the Council, or the Court on appeal, as the consent authority, to form the requisite opinions of satisfaction on the written evidence provided by the applicant, that the matters referred to in cll 27(1) and 74(1) of SEPP (SL) will be provided.

57 I note that the Council in its letter of 19 December 2005 has expressed the view that the written evidence so far supplied by the applicant in the development application or in accompanying documents, is inadequate to establish, to the Council’s satisfaction, the matters in cll 27(1) and 74(1) will be provided. The applicant will no doubt take this on board and decide whether it wishes to provide further written evidence to the Council on these matters.

58 The findings I have made above as to the construction of cl 2(1)(h) of Pt 1 of Sch 1 of the Regulation and cll 27(1) and 74(1) of SEPP (SL) do not require that I express any view on whether the Council as the consent authority should or should not form an opinion of satisfaction in relation to the matters in cll 27(1) and 74(1) of SEPP (SL). I do not do so. It is for the Council or the Court on appeal, as the consent authority, to find at the time of determination of the applicant’s development application, whether it is satisfied on the written evidence then available to it, whether the matters in cll 27(1) and 74(1) will be provided.

Costs

59 The applicant has been successful in these class 4 proceedings and the usual order for costs should be made, namely that the Council which has been unsuccessful pay the applicant’s costs of the proceedings, as agreed or assessed.

Orders

60 The Court:

1. Declares that the determination of the Council of the Municipality of Kiama of 19 December 2005 to reject development application number 10.2005.418.1 is void and of no effect.

2. Declares that development application number 10.2005.418.1 lodged with the Council of the Municipality of Kiama on 12 December 2005 was validly made within the meaning of the Environmental Planning and Assessment Act 1979.


3. Orders the respondent to pay the applicant’s costs of the proceedings, as agreed or assessed.

4. Orders that the exhibits be returned to the respective parties.

**********