E J Cooper and Son Pty Limited v Baulkham Hills Shire Council
[2003] NSWLEC 384
•12/10/2003
>
Land and Environment Court
of New South Wales
CITATION: E J Cooper & Son Pty Limited v Baulkham Hills Shire Council [2003] NSWLEC 384 PARTIES: E J Cooper & Son Pty Ltd (Appl)
Baulkham Hills Shire Council (Resp)FILE NUMBER(S): 30607 of 2003 CORAM: McClellan CJ KEY ISSUES: Compensation :- Amount of compensation
Objection
Whether prudent purchaser would have discounted price to be paid due to possibility of presence of protected land or protected waters on site
Whether river within meaning of Rivers and Foreshores Improvement Act 1948 present on land
Whether natural or artificial channelLEGISLATION CITED: Rivers and Foreshores Improvement Act 1948 CASES CITED: Azzopardi & Ors v Gosford City Council (2002) 123 LGERA 118 DATES OF HEARING: 8-12 December 2003 EX TEMPORE
JUDGMENT DATE :
12/10/2003LEGAL REPRESENTATIVES: M I Bozic SC/M S Henry (Resp)
N Hemmings QC/C Leggat (Appl)
Marsdens Law Group (Sol - Appl)
Matthews Folbigg Pty Ltd (Sol - Resp)
JUDGMENT:
IN THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES
30607/03
WEDNESDAY 10 DECEMBER 2003McCLELLAN J
- Applicant
- Respondent
Judgment
(as to whether land contains a river)
1 HIS HONOUR: The proceedings before me are a claim by the applicant for compensation in relation to a parcel of land being Lots 14 and 15 in DP 1041791 at Castle Hill. The resumed land has an area of approximately 4.3 hectares.
2 The land formed part of a larger holding owned by E J Cooper & Son Pty Limited. That company, as I understand it, through a family structure, used the land in former years for a major chicken breeding operation. Before that the land was for many years used for rural purposes including farming and grazing. The evidence does not disclose the point at which it came to be used more intensively for the chicken operation, although it is plain that this had occurred by 1961. There is in evidence an aerial photograph which shows that by that time the resumed land and other lands adjacent to it had been developed with a number of large chicken sheds, a large dam and a residence, which I understand was the residence of the manager.
3 The land is flat land with a fall of less than one per cent across it generally in a South to North direction. Inspection of the land reveals that there are some lower lying areas where after rainfall water will accumulate. In those areas there are reeds and other vegetation consistent with damp or at times swampy ground. There are also areas which have been obviously disturbed. There are man-made drains and there is a dam which is a siltation dam created for the purpose of containing run-off from adjoining lands.
4 The resumed land has now become virtually surrounded by residential development. There are some lots still undergoing development but the general picture in the area is of an urban landscape. A short distance from the land to the north a regional shopping centre has been developed. The nearby residential development comprises single dwellings, townhouses as well as development at a greater density.
5 There are a number of issues which the parties have identified relevant to the value of the compensation which should be paid for the resumed land. However the most significant issue which has emerged in the course of proceedings is whether a river, within the meaning of the Rivers and Foreshores Improvement Act 1948 is present on the land. If a river does exist, then before that river could be piped, as is contemplated by the applicant in the form of any hypothetical development of the land, permission would have been required under the Act. The land was resumed on 24 January 2003, at which time the relevant government department from which to seek permission was the Department of Land and Water Conservation.
6 It is submitted by the council that a river exists, and accordingly would have been identified by any hypothetical purchaser as a problem which would have proved to be an impediment to the immediate development of the land and may have ultimately caused difficulties in development of the whole property. It is submitted that as a consequence, because a river exists, the hypothetical purchaser would pay a lesser price than would have been the case if there was no river.
7 Because of its significance in the determination of appropriate compensation the parties have agreed that I should answer in effect nine preliminary questions. The parties are to be commended for adopting this course. This matter is complex and involves a significant money claim. By adopting this course it will be likely that the matter can be disposed of more efficiently than would otherwise have been the case.
8 The questions which the parties have agreed should be answered as separate questions are as follows:
“Within the meaning of the Rivers and Foreshores Improvement Act 1948 (NSW) (the Rivers Act ).
Protected Waters:
1. Does a stream of water whether perennial or intermittent flow on the subject land?
2. Does it flow in a natural channel?
3. Does it flow in a natural channel artificially improved?
4. Does it flow in an artificial channel which has changed the course of a stream?
Protected Land:
5. Does the subject land contain a river which has a bank, shore or bed?
6. If the answer to 5 is yes, where is the bank, shore or bed located?
7. Would a purchaser making prudent enquiries at 24 January 2003 have concluded that the subject land contained protected land or protected waters within the meaning of the Rivers Act?Prudent Enquiries:
8. If a river does exist on the subject land would the prudent purchaser have concluded that a permit pursuant to Pt 3A of the Rivers Act would be likely to be issued?
9. To what extent, if any, would the price that a prudent purchaser have paid for the acquired land have been discounted by reason of the possibility that the acquired land contained “protected land” or “protected waters” within the meaning of the Rivers and Foreshores Improvement Act 1948?”
9 The final question, in my opinion, correctly identifies the ultimate question which must be answered. It is possible that I could conclude that there is not a river within the meaning of the Act on this land, but nevertheless the features of the land and information which would have become available to the hypothetical purchaser may have caused that purchaser to harbour reservations as to whether or not the land could be immediately developed. The hypothetical purchaser would have considered whether negotiations with the authorities or perhaps an appeal to this Court would be necessary and whether, at the end of the day, part of the land might be precluded from development. However I shall return to those questions after I have considered the relevant factual material.
10 In evidence area a series of aerial photographs and a number of plans of the land. The aerial photographs are a sequence which starts in 1947 when the resumed land is obviously being used for grazing purposes. At that time there appear to be two modest farm dams located on the resumed land, one towards the southern end and the other towards the North. The northern boundary of the land adjoins Wrights Road, beyond which it is agreed that in 1947 a creek known as Smalls Creek existed and can be identified in the aerial photograph. By 1961 the development on the land has changed. Chicken sheds have been constructed, some on the resumed land and some on immediately adjoining land, and a larger dam has been created at the northern extremity of the resumed land. The 1961 photograph is in evidence in an enlarged and clear version, and in my opinion it is plain that that large dam is contained by a constructed wall with some vegetation immediately to its West. I can discern no evidence of anything in the nature of a defined water course or channel adjacent to the dam wall in that photograph.
11 As I indicated, there is also in evidence a topographic map which reflects the development of the resumed land with chicken sheds and also depicts the large dam adjacent to Wrights Road. The draftsman has included an extension of Smalls Creek into the resumed land for a short distance, being about half way along the length of the dam. There was debate in the evidence between Dr Webb - a hydrologist called by the applicant - and Mr Lucas, who was called by the respondent, as to whether or not that extension of Smalls Creek was accurate, having regard to the appearance of the land in the aerial photograph. I accept Mr Lucas when he says that if the farm dam had been properly constructed it may have included a facility for any stream to pass by the dam and for the dam not to have been located within any stream. However the draftsman of the topographic plan does not suggest that there is a stream which is upward or beyond the southern extremity of the dam. Rather the map suggests a stream which rises adjacent to the dam. That, in my opinion, would be a most unlikely situation. The evidence of Dr Webb is that the draftsman, in extending Smalls Creek has mistakenly assumed that the tree feature on the aerial photograph which would have been used for the purpose of creating the topographic map was a stream. Dr Webb’s opinion is that a mistake has occurred and accordingly the topographic map does not accurately reflect the true position. For the reasons I have indicated, I accept Dr Webb’s evidence in relation to that aspect of the matter.
12 There are further aerial photographs in evidence but in my opinion they do not add significantly to the evidence which must be assessed in order to determine the relevant questions. It is plain that as the chicken facility was developed it was necessary to accommodate run-off water in drains and they can be seen on the aerial photographs. It was also logical that those waters, once collected, would pass into the dam which was obviously constructed for the purpose of providing a significant storage facility for the chicken operation.
13 Mr Lucas prepared a written report which was tendered in evidence. He drew upon both the aerial photographs and the topographic maps to express the conclusion that there was a water course through at least part of the resumed land and which included the blue line which is shown adjacent to the dam on the topographic map. He also had regard to an earlier parish map which shows a broken line which passes through the land. The fact that it was a broken line does not suggest that there was anything in the way of a continuous defined path for water through the subject land. Mr Lucas has also traversed the site, both on foot and in his four-wheel drive vehicle. He identified a number of areas where water has collected in ponds and where there is vegetation reflecting a high water table with collected surface water. In his opinion, the pools within which that water collects are connected, so that he has concluded that there is relevantly a stream of water which would comprise a river passing through the land.
14 On the other hand, Dr Webb has also examined the land. He concluded that at some stage in the past there may have been a defined path through which water travelled through the site, but this disappeared a long time ago. Although accepting that such a defined path of water was a possibility he says the available evidence, including the aerial photographs, topographic maps and his examination of the site, do not lead to that conclusion today. There are some man-made channels, with various depressions, where water will pond following rainfall. However in his opinion the site is so disturbed that even if it was once the case, it could not now be suggested that there is a stream of water passing through the site, either permanently or intermittently. In his opinion no question of any need to approach DIFNR (the successor to the Department of Land and Water Conservation) to seek consent to pipe any water through the land would have arisen.
15 Any purchaser who had sought to acquire this land at the date of resumption must of course be assumed to have acted prudently. Being a large area of land for which, on any view of the matter, significant moneys would be expended, the purchaser could be assumed in acting prudently to have obtained the advice of appropriate experts before purchasing the land. In my opinion that advice would have extended to seeking the opinion of a consultant engineer familiar with, and experienced in, the subdivision of land in the local area.
16 The applicant has called Mr Maloney, an engineer with such experience. He has not only advised in relation to the subdivision of other parts of the applicant’s land, but has given advice to others who have carried out subdivision in the Castle Hill and Kellyville area where, as I have already indicated, significant residential and commercial development is taking place.
17 Mr Maloney gave evidence of enquiries which he had made of the council in relation to the prospective development of Lot 21 which formed part of the original holding of the applicant. That land has now been developed with medium density housing. It has been filled in part. In the course of his enquiries of the council he observed the relevant council officer to use a check-list of matters which need to be considered. That check-list included whether or not it was necessary to make enquiries of DIFNR. The evidence he gave was the officer with whom he spoke confirmed, by ticking the appropriate item, that such enquiries were not necessary. The consequence is that the evidence before me is that if an experienced engineer was retained and he made enquires of the council in relation to whether or not it was possible to interfere with the natural flow of water across land immediately adjacent to the subject land, permission would have been granted without any question of a need to refer the matter to DIFNR. There was certainly no suggestion that a permit would have been required.
18 Immediately adjoining the subject land are Lots 11, 12 and 13 which are also undergoing residential development. In the course of obtaining approvals for the development of those lots permission was sought to construct drains and a sedimentation pond within areas now suggested as forming part of the area where a river passes through the resumed land. The fact that council has given those consents without raising any question of a need to consult DIFNR confirms the advice which Mr Maloney was given, that there was no difficulty in that respect.
19 A person such as Mr Maloney would also be likely to have been asked to advise a purchaser generally in relation to the difficulties, if any, of developing the land. Although Mr Maloney in his evidence identified the need to consider effective drainage, he would not have advised any purchaser that it was necessary to consider difficulties which might arise from the presence of a river passing through it.
20 The attitude of the council, if enquiry had been made, may also be gleaned in part from the council’s intentions in relation to the resumed land. Although of course in the hypothetical situation the land would not have been resumed, and these proposals would therefore be irrelevant, they nevertheless reflect the council’s thinking in relation to the status of the land under the Rivers and Foreshores Improvement Act.
21 By the time of resumption a plan had been prepared for the redevelopment of the resumed land with facilities which included a roadway and major recreation area. The proposal, as defined at the time of resumption, contemplated the piping of water through the resumed land without any suggestion that it would be necessary to obtain the consent of DIFNR or that there would be any need to provide for an open waterway through any part of the land. This position is evidenced also in plans for the roadway for which the latest revision prior to resumption was August 2002. Those plans have since been revised and in plans which were issued within recent weeks, and apparently are now to be constructed, provision has been made to carry a large section of the waterway through an open channel. However that was not the position at the date of acquisition.
22 The council has also tendered in evidence a letter from DIFNR to the valuer who the council has retained for the purpose of assisting in this hearing. The letter is dated 16 April 2003 and addressed to the Valuer. It commences by saying:
- “I refer to our discussion Friday 11 April 2003 and your subsequent letter received by the Department forwarded in April 2003 seeking the advice in relation to the above subject.”
23 The subject referred to is the compulsory acquisition of Lots 14 and 15. The letter continues:
- “The Department offers the following comments:
- 1 The water course on the site is a ‘river’ for the purposes of the River and Foreshores Improvement Act 1948. ”
24 The council submits that this letter is evidence of the position which would have pertained if enquiry had been made of DLAWC at the time of the acquisition. And accordingly it is submitted it is evidence which would suggest a potential impediment to the expeditious development of the land and possibly would prevent part of it from being developed.
25 That submission faces a number of difficulties. First of all the letter is dated 16 April 2003, some three months after the land was resumed. The author of the letter has not been called and there is nothing in the letter to suggest that the author has ever seen the land or been provided with the evidence which has been tendered to this Court as to its condition. Furthermore, the assumption in paragraph 1 which I have referred to is that there is a water course on the site. That being the assumption which the author was apparently required to make, it is not surprising that the letter expresses the conclusion that there is for the purposes of the legislation a river on the land. The real question was whether or not there was a water course and that question is not addressed by the letter.
26 Counsel for the council submits that the highest case which could now be advanced, having regard to the evidence to which I have referred, is that there is relevantly a river on that part of the land adjacent to the large dam shown in the 1961 photograph, with a suggestion that through the rest of the resumed land there may have been previously a river which has now suffered significant disturbance. It is submitted that as a consequence, although the first eight questions may be answered adversely to the council, nevertheless a prudent purchaser would have been troubled by the evidence of a river on the land and accordingly have discounted the price which it would have been prepared to pay.
27 With that submission in mind I turn to the particular questions asked.
28 Question 1: Having regard to the evidence I am satisfied that there is not presently on the land a stream of water either perennial or intermittent, so that it could be said that there is a river on the land. At its highest the evidence suggests that this very flat land has, when it rains, water flowing across it in sheet form, some of which has now been artificially captured in drains, and that water is deposited on to the land and some of it gathers in low-lying ponds. Water which does not leave the land by some overland and undefined flow will find its way into the substrate and no doubt leave through subsurface flows.
29 In Azzopardi and Ors v Gosford City Council (2002) 123 LGERA 118 the Court of Appeal considered the definition of a river in the circumstances of land which was undergoing development pursuant to a development consent. The Court was divided as to whether or not the facts revealed that there was relevantly a river on the land. Handley JA, with whom Foster AJA agreed, concluded that:
- “The appellant’s evidence at the highest did no more than establish the existence of a natural water course which could be described as a drainage depression or a swampy creek.”
30 In my opinion, the evidence in the present case indicates that although the land is very flat there are some lower portions where water will collect which could properly be described as a drainage depression. However I am satisfied that although water flows across the land it does not flow relevantly in a stream so as to bring it within the definition of a river.
31 Accordingly question 1 is answered No. Question 2 is answered no. Question 3 is answered no. Question 4 is answered no.
32 It follows from the finding that there is not relevantly a river on the land that the answers to questions 5 and 6 are both no.
33 The answer to question 7 is no, and the answer to question 8 is no.
34 I have discussed the evidence which has been tendered as to the results of enquiries which a prudent purchaser may have made before purchasing the resumed land. In summary they are that the council upon enquiry would not have raised any question of there being a problem in piping the waters on the resumed land as part of any urban development. In my opinion, that being the result of an enquiry with the council, observation of the land by an experienced person such as Mr Maloney would not have caused the hypothetical purchaser to consider that there was a need to approach DLAWC or any other government agency in relation to that aspect of the development potential of this land. The hypothetical purchaser would have looked to the nature of development in the area, would have observed the approvals given in relation to adjacent land and having regard to the nature of all those matters would have concluded that the fact that water passed through the land and on to it was not in any way an impediment to the piping of that water which would allow for the development of the whole of the land.
35 In those circumstances I am satisfied, in answer to question 9, that a prudent purchaser would not have discounted the price which it might have been prepared to pay by reason of the possibility that the acquired land contained protected land or protected waters within the meaning of the Rivers and Foreshores Improvement Act 1948.
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