Frank Russo v Kogarah Municipal Council
[1998] NSWLEC 95
•08/14/1998
Land and Environment Court
of New South Wales
CITATION: Frank Russo v. Kogarah Municipal Council [1998] NSWLEC 95 PARTIES: APPLICANT
RESPONDENT
Frank Russo
Kogarah Municipal CouncilFILE NUMBER(S): 10774 of 1997 CORAM: Sheahan J KEY ISSUES: :- LEGISLATION CITED: Environmental Planning and Assessment Act 1979
Land & Environment Court Act 1979
Kogarah Local Environmental Plan No.36CASES CITED: Golden v Coffs Harbour City Council (1991) 72 LGRA 104 per Stein J at 106-7;
Schaffer Corporation Limited v Hawkesbury City Council ("Schaffer") (1992) 77 LGRA 21;
Challister Limited v Blacktown City Council (1992) 76 LGRA 10.;
Coffs Harbour Environment Centre Inc v Coffs Harbour City Council (1991) 74 LGRA 185;
Bodyline Spa & Sauna (Sydney) Pty Limited v South Sydney City Council ("Bodyline") (1992) 77 LGRA 432;
The Ultimate Skirmish Game Pty Limited v Wollondilly Council, 10400 of 1993;
Russo v Kogarah Council (1995) 86 LGERA 300 at 304-8);
Blair & Ors v Curran & Ors ("Blair v Curran") (1939) 62 CLR 465 at 531-2.;
Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589;
Carl Zeiss Stiftung v Raynor & Keeler Limited [No.2] [1967] 1 AC 853 ;
Chamberlain v Deputy Commissioner of Taxation (1987) 62 ALJR 324DATES OF HEARING: 18/03/98, 22/05/98 DATE OF JUDGMENT:
08/14/1998LEGAL REPRESENTATIVES: RESPONDENT
APPLICANT
Mr J M Atkin, Barrister
Mavrakis & Associates
Mr G Newport, Barrister
Ms J Hewitt of Abbott Tout
JUDGMENT:
1. INTRODUCTION
Russo has conducted a child care centre, with Council's consent, at No.3 Rocky Point Road Kogarah ("No.3") since February 1991.
He has for some time been trying to obtain approval to expand the operations of his child care centre (effectively to double in size) into the former/vacant dwelling house property next door, at No.1 Rocky Point Road ("No.1"). Council has consistently maintained its opposition to this expansion proposal.
The history of these proceedings will be described more fully later in the judgment, but they concern an appeal against Council's (latest) refusal of a development application by Russo seeking the use of No.1 for child care facilities.
Council has raised the following preliminary question of law:
"Whether or not the proposal is permissible within the 4(B) Light Industry zoning pursuant to the Kogarah Planning Scheme Ordinance?"
It is common ground that the zoning of the subject site is in fact "4(b)(Light Industrial Zone)" under Kogarah Local Environmental Plan No.36 (Kogarah Precinct) which amends the Planning Scheme Ordinance (for simplicity I will refer to this documentary planning regime as "the plan").
When Mr Atkin, Counsel for Russo, made his submissions on the question of law as posed, on the first hearing day, 18 March 1998, Counsel for the Council met him with an argument that the issues in the appeal are res judicata.
In those circumstances there would be little utility for Russo in the Court's answering the preliminary question of law simply in the affirmative.
It was therefore agreed between the parties, and with the Court, that both questions should be determined, namely permissibility and res judicata.
Between the first hearing day and the resumption of the hearing on 22 May 1988, the parties did not seek to change the nature of the proceedings. Russo did not elect to change his application to one for leave to appeal out of time against one or more of the earlier relevant decisions, nor did Council seek to change the question of law in the face of the way in which it had been argued on Russo's behalf.
The planning and historical contexts need both be set out in some detail before I turn my attention to the two substantive issues before me.
2. THE RELEVANT PLANNING PROVISIONS
The aims and objectives of the plan are set out in cl 2. The most relevant of the aims is cl 2(1)(c):
"to give the Council greater responsibility for environmental planning by creating only a broad frame work of controls and to create opportunity for the more detailed provisions relating to matters of significance only for local environmental planning to be contained in development control plans made by the Council."
The objectives are set out in cl 2(2), the relevant paragraphs of which are set out below:
"(a) to divide land in to the zones referred to in clause 9 and to achieve in respect of land within each of those zones the objectives specified for that zone in the Table to clause 10;
...
(c) to ensure that development is carried out in such a way as to allow the economic and efficient provision of public services and amenities;
...
(f) to enable a variety of commercial uses while consolidating existing commercial centres;
(g) to enable a variety of uses in industrial areas while protecting the viability of existing retail centres;
(h) to ensure space is provided for community services and facilities;
..."
Clause 6 of the plan includes some relevant definitions, none of which apply in this particular case, but cl 7 imports the 1980 Model Provisions, the relevant definitions within which are as follows:
* " `child care centre' means a building or place which is used (whether or not for profit) for the purpose of educating, minding or caring for children (whether or not any of the children are related to the owner or operator), but only if the following conditions are satisfied:
(a) the children number 6 or more, are under 6 years of age, and do not attend a government school, or a registered non-government school, within the meaning of the Education Reform Act 1990; and
(b) the building or place does not provide residential care for any of the children (other than those related to the owner or operator)."
* " `Commercial premises' means a building or place used as an office or for other business or commercial purposes, but does not include a building or place elsewhere specifically defined in this clause or a building or place used for a purpose elsewhere specifically defined in this clause".
* " `Light industry' means an industry, not being an offensive or hazardous industry, in which the processes carried on, the transportation involved or the machinery or materials used do not interfere with the amenity of the neighbourhood by reason of noise, vibration, smell, fumes, smoke, vapour, steam, soot, ash, dust, waste water, waste products, grit, oil, or otherwise".
It would seem to be clear from these definitions that a "child care centre" is not "commercial premises", but the contrary was argued on an earlier occasion, and it has been argued on this occasion that it may be a "light industry".
Zone objectives and the development control table appear at cl 10.
Clause 10 provides:
"(1) The objectives of a zone are set out in the Table to this clause under the heading `Objectives of Zone' appearing in the matter relating to the zone.
(2) Except as otherwise provided by this plan, in relation to land within a zone specified in the Table to this clause the purposes (if any) for which:
(a) development may be carried out without development consent;
(b) development may be carried out only with development consent; and
(c) development is prohibited,
are specified under the headings `Without development consent', `Only with development consent' and `Prohibited' respectively, appearing in the matter relating to the zone.
(3) "Except as otherwise provided by this plan, the Council shall not grant consent to the carrying out of development on land to which this plan applies unless the Council is of the opinion that the carrying out of the development is consistent with the objectives of the zone within which the development is proposed to be carried out." (emphasis added)
In respect of zone 4(b) (Light Industrial Zone) the objectives are:
"(a) to encourage the establishment of industries outside areas zoned for residential or business purposes by making general provision to set aside an area of land to be used for a broad range of light industrial purposes;
(b) to recognise existing industry and to encourage the establishment of new industry so as to expand the local employment base, and to minimise any adverse effect of industry on the activities in other zones; and
(c) to allow small-scale commercial and retail development only where it relates to or provides a service for the use of land within the zone for industrial purposes or involves bulky goods inappropriate for a commercial zone".
The effect of the balance of the table is that nothing is permissible without development consent and everything is permissible only with development consent, other than the purposes listed in item (4) namely the prohibited uses of Boarding-houses, generating works; heliports; industries (other than light industries); institutions; liquid fuel depots; mines; stock and sale yards.
3. THE RELEVANT HISTORY OF THE PROPOSAL
3.1 The first application
Development Application ("DA") numbered 276/92 was lodged 23 October 1992 and proposed, in terms, the consolidation of Nos.1 and 3 "for use as a pre school".
It was proposed to construct a "cover" between the buildings, attend to some carparking and fencing arrangements, and remove "external walls to existing store to form awning".Council refused consent on 25 January 1993 for 9 reasons, the first of which was that the proposal was not consistent with the objectives of the 4(b) zone.
The appeal against that refusal (10642 of 1992) was heard and dismissed by Assessor Nott on 23 March 1993.
3.2 Assessor Nott's judgment
Assessor Nott said:
"On the material presented to the Court on the first ground of refusal, it appeared to me that the proposed development was not consistent with the objectives of the 4(b) Light Industrial Zone ..., and I therefore, without expressing ... a final opinion, sought to hear all evidence and submissions concerning the first reason for refusal. There would be no point in hearing evidence on the other grounds of refusal if in fact a determination were made that the proposal is inconsistent with the objectives; no matter how meritorious otherwise the development might be, the court could not grant a consent." (emphasis added)
The learned Assessor went on to consider the implications of cl 10(3) of the plan and the objectives of the 4(b) zone.
The applicant had relied upon the fact that the consent for the use of No.3 was granted after the coming into force of the plan in October 1989. He argued that it was unreasonable for the Council to support one of the two properties being used as a child care centre but oppose consent for the combined properties being so used.
After considering all the expert evidence the Assessor concluded:
"I accept the opinion of Mr Layman, and on the material presented to the Court it is clear to me that the proposed development is not consistent with the objectives of the zone. It is not the right place under the zoning for the carrying out of a child-care centre, ... [and] the Court is obliged to dismiss the appeal." (emphasis added).
3.3 The second application
On 7 July 1993, Russo lodged DA 173/93, which again sought the consolidation of Nos.1 and 3 and proposed their combined "use as a pre school".
Council refused the application on 21 March 1994 on eight stated grounds including its purported lack of consistency with the objectives of the 4(b) zone.
An appeal was lodged (10296 of 1994) and was dealt with by Assessors Bly and Bull on 10 and 11 October 1994.
The learned Assessors delivered their reserved judgment on 1 November 1994 and dismissed the appeal.
3.4 The Bly/Bull judgment
The learned Assessors saw the application as being for "the conversion of an existing dwelling house for use as a child care centre in conjunction with an existing child care centre".
The Assessors examined the provisions of the plan and proceeded to consider the eight reasons given for Council's refusal.
In respect of Assessor Nott's earlier decision they commented:
"An earlier development application for an almost identical proposal was refused by Council on 25 January, 1993. The Applicant subsequently appealed to the Court (10642 of 1992) and Assessor Nott in his judgment found that the proposal was not consistent with the objectives of the 4(b) zone. As a consequence of this inconsistency, clause 10(3) of Kogarah LEP 36 obliged the Court to dismiss the appeal". (emphasis added).
The applicant had called Mr Rannard as an expert town planner, and the Assessors commented (at 5-6):
"We accept Mr Rannard's evidence that the proposed child care centre is a commercial development. We also accept that child care centres can be considered as a purposes (sic) ancillary to industrial zones, and need not necessarily be out of place in such zones. Compliance with the objectives is certainly possible. However before such a facility should be approved in the 4(b) zone, it needs to be considered in terms of size, nature and particular context.
The extended child care centre will occupy a significant proportion (about 13%) of the surrounding 4(b) zone. However, despite there being demonstrated demand for the facility, the users of this zone have not expressed any need for or shown any likelihood that they will utilise the facility to any extent at all, much less to the extent of the proposed 58 child capacity. We are persuaded that these factors provide a clear indication that the proposal is unlikely to be ancillary to or supportive of the industrial zone. On this basis, it is likely that the existing capacity of the existing facility would be more than sufficient to cater for any demand generated by the users of the zone, should it arise.
....
We therefore conclude that the proposed extended child care centre would not be consistent with the objectives of the 4(b) zone and hence, in accordance with clause 10(3) of Kogarah LEP 36 the application is refused. It seems to us that the centre has no clear functional relationship to the zone and could possibly be located anywhere. We are also of the opinion that in the absence of these objectives and clause 10(3) we would most likely have come to the same conclusion, based on the town planning approach which requires that uses other than those falling within the principal category of uses provided for in the zone (eg industries in an industrial zone) should have a clear and justifiable ancillary relationship to the uses in the principal category.
Also, having so concluded in relation to the objectives of the zone and clause 10(3) of the plan, it is unnecessary for us to determine how the decision of Assessor Nott referred to above might otherwise have affected the outcome of this appeal." (all emphasis added).
The Assessors went on to deal with all the other issues that had been raised and came to the conclusion as follows:
"We have noted the applicant's contention that the changes will significantly improve the present facility and his concern that the property `owes' him a significant amount of money. We have also noted Mr Rannard's contentions that the proposal would not inhibit future redevelopment of the site for industrial purposes, the difficulty of developing the small No.1 for industrial purposes and the demonstrated demand for the centre. We have not however been persuaded that these arguments are such as to overcome our finding that the proposal would be inconsistent with the objectives of the 4(b) zone and should thus be rejected on the basis of clause 10(3) of Kogarah LEP 36". (emphasis added).
It is clear from an analysis of that judgment that the Assessors did not adjudicate upon a claim made by the applicant that existing use rights attaching to No.1 provided an alternative source of power for the grant of development consent.
Mr Russo appealed pursuant to s 56A of the Land & Environment Court Act 1979 and that appeal was heard by Bignold J.
3.5 The judgment of Bignold J
In judgment delivered 15 March 1995 (see 86 LGERA 300), Bignold J held that:
* cl 10(3), on the facts, may have the effect of prohibiting a dwelling house use in the 4(b) zone because it would be legally unreasonable for Council to conclude that a dwelling house use was consistent with the objectives of the zone, and, accordingly,
* the dwelling house use of No.1 was an "existing use" within EPAA s 106.
His Honour went on to hold that Russo had "fairly and squarely raised the question" and "that the failure by the Assessors to mention or address the existing-use entitlement relied upon by the Applicant, (either as part of their substantive decision on the appeal or in their reasons for the decision) is such a serious omission as to constitute a miscarriage of justice".
His Honour pointed out that the appeal before him did not seek to challenge any of the findings, or the ultimate conclusions based upon them, in the hearing before Assessors Bly and Bull, but he determined that the applicant was entitled to an adjudication of the alternative claim and the matter was remitted to the Assessors for further consideration.
When the case went before the Registrar for callover the parties indicated that there was still a preliminary question of law to be determined. Technically, the matter was still part-heard before the Assessors, and they approached the Chief Judge with a question of law concerning the current existence of existing use rights.
3.6 The judgment of Pearlman J
The Chief Judge proceeded to adjudicate on the question "whether the property known as 1 Rocky Point Road, Kogarah, currently enjoys existing use rights as, and may continue to be used as, a dwelling house".
In an ex tempore judgment on 21 August 1995, the Chief Judge determined that the use of the residence was not continuous, but intermittent and occasional. Its use was certainly as a dwelling house, but that use had eventually ceased.
Her Honour concluded that the existing use of the premises as a dwelling house had been abandoned and said: "That conclusion makes it unnecessary for me to examine Mr Russo's own intentions and actions in relation to the premises. By the time he acquired them, they had lost their existing use rights and it makes no difference what Mr Russo's intentions were".Having answered the question of law posed by the Assessors, the proceedings were again remitted to them to be determined in accordance with the finding.
3.7 The final stage of the second appeal
A perusal of the Court file in matter 10296 of 1994 indicates that, when the parties apparently determined that there was little point in continuing what was left of the matter before the Assessors (the second ground formerly before them having been dealt with by the Chief Judge), the application was discontinued by consent on 22 August 1995.
4. THE CURRENT DEVELOPMENT APPLICATION AND THESE PROCEEDINGS
DA167/96 was lodged on 6 August 1996.
It refers, in terms, to only No.1, describes its present use as "residential" and its proposed use as "child care centre", and describes the proposed development as involving "demolish internal walls to existing lounge dining and bedroom. Demolish garage".
The development application does not mention consolidation of the two properties.
On 27 September 1996 the Council notified Mr Russo that it had resolved to grant deferred commencement approval of the application, subject to its approval by the Department of Community Services. The Council also resolved that the Acting Director of Council Services bring forward a report at the next relevant meeting outlining appropriate conditions for ratification by Council. No time limit was mentioned in the letter of 27 September 1996.
On 25 October 1996 the Department advised of its approval on certain conditions including that the maximum numbers of children be 8 aged 2-3, and 21 aged 3-6.
The Council at its meeting on 25 November 1996 received a motion to rescind the previous deferred approval.
The rescission motion was carried at the regular Council meeting on 9 December 1996 by 6 votes to 5.
The resolution carried by Council on 9 December 1996 was to adopt the advice of its lawyers and refuse the application for:
"additions to and the use of an existing building at 1 Rocky Point Road, Kogarah as a Child Care Centre for the following reasons:
1. The proposal is prohibited within the 4(b) Light Industrial Zoning of the property;
2. Pedestrian access from Rocky Point Road is unacceptable;
3. Inadequate provision has been made for off-street car parking;
4. The proposal does not comply with the `Industrial/Showroom' area objectives of the Kogarah Precinct Development Control Plan;
5. The proposal will adversely affect the flow of vehicular traffic within the rear service land and pose a risk to pedestrian safety; and
6. The location of the outdoor play area within the Rocky Point Road frontage is unacceptable given the adverse affect [sic] of high levels of pollutants upon the children who will utilise such an area."
A letter dated 20 December 1996 then issued as official notification of the determination by the Council and consent was stated to have been refused for the following three reasons:
"1. To ensure proper management and development of natural and man made resources so as to promote the social and economic welfare of the community;
2. To ensure orderly and economic use and development of land;
3. To minimise any adverse impact of developments and protect the environment".
These proceedings were commenced on 10 December 1997 by way of appeal against that refusal.
(A motion in these proceedings that the notice of determination of the development application dated 20 December 1996 be deemed to include letters dated 18 November 1996 and 6 December 1996 from Abbott Tout Solicitors to Kogarah Municipal Council, was declined by Justice Lloyd on 13 February 1998).
5. QUESTIONS OF RES JUDICATA ARISE IN DISCUSSIONS
On 14 January 1998, the solicitors for Council wrote to the solicitors for Russo drawing attention to the earlier decisions of the Court dismissing the appeals against Council's refusal of the two earlier applications.
The solicitors for Council suggested that Russo's current development application "is prohibited in the zone" and that the raising of issues which have already been litigated between the parties means the principle of res judicata arises.
The solicitors for Russo responded (on 16 January 1998), not accepting that the matter was res judicata. The letter said that it would be argued on this occasion that "a child care centre is a service industry .... within the permissible use as a light industry".
It was contended that "in all the appeals [so far heard by the Court], it was not argued that a child care centre is a light industry". Before Assessor Nott, the argument was based on the fact that No.3 had been approved as a child care centre, and in the subsequent proceedings Assessors Bly and Bull accepted evidence "that the child care centre was a commercial development".
Bignold J had considered only the "question of existing use entitlement", and Pearlman J's decision was "restricted to the question of existing use rights".
The letter of 16 January 1998 concluded:
"The applicant will request that the court will consider the development application on the basis that a child care centre is a light industry. It is also in an area outside areas zoned for residential or bossiness [sic] purposes. It is a [sic] extension of a [sic] existing industry. It will minimise any adverse affect [sic] of having such a [sic] industry in another zone. Accordingly, the child care centre in the zone would not be inconsistent with the objectives of the 4 (b) zone."
Council formulated the preliminary question of law on 29 January 1998 in the light of the above letter.
Its Counsel submits that the issues now before the Court, as a result of a "shift in ground" by the applicant between the letter of 16 January 1998 and the first hearing date on 18 March 1998, are res judicata, because development applications for the conversion of No.1 into a child care centre have been twice refused by Council, and by Assessors of the Court, and earlier proceedings in the Court include determinations by two Judges unfavourable to the applicant (one in the nature of an appeal under s 56A, and the other on a point of law).
Council submits that the Court has already determined the question of whether a child care centre is consistent with the objectives of the relevant zone, with the result that the proposal now before the Court is likewise not permissible as a result of the operation of cl 10(3) of the plan. In this regard, the deletion from Russo's proposal of any mention of consolidation of the lots is said to make no difference.
6. THE THREE APPLICATIONS AND SETS OF PLANS
Counsel for Russo quite properly conceded on the second day of the hearing that all three applications Russo had submitted are for the same purpose, namely that of establishing a child care centre within the former residential property at No.1
All applications involve the same number of children, and the same number of staff. There are some differences among them, such as internal layout, and some external changes. Some of those differences/changes were dictated, apparently, by the demands of the relevant State government department.
The actual development applications, and the plans respectively lodged with them, were before the Court on the second hearing day, and Counsel for both parties effectively made a joint presentation to the Court of the observable differences.
Counsel could detect no real difference between the plans lodged with the first and second applications, both of which displayed an application to use the existing dwelling at No.1 and consolidate it with No.3.
The plans accompanying the third application, on the other hand, have one major (structural) difference, in that there is the proposed removal of what were toilets and washrooms from the original proposal from the southern to the northern side of the site.
Nonetheless, all three sets of plans portray a child care centre in the shell of what has hitherto been regarded as, and used as, a residential dwelling house.7. THE COMPETING ARGUMENTS
Because of the complexity of all questions of estoppel or res judicata, it is necessary to set out the various competing submissions in some detail.
7.1 The Applicant's Contentions
Mr Atkin points out that the Assessors' decisions, and those of the two Judges, did not deal with the question of law regarding permissibility which is now before the Court.
He also points out that the case law has developed, and the nature of the locality has changed, over the intervening years.
The application and interpretation of the objectives and other provisions of the plan may change, and the circumstances and method of formation of the Council's opinion may also be different.
The factual exercise required by the Court in 1998 to assess the current development application may result in a different merits outcome on the (new) facts.
His submissions on the question of law focused on the meaning of the expression central to cl 10(3) of the plan, namely "consistent with the objectives of the zone".
He argued for an interpretation of this term as meaning "not incompatible with the objectives of the zone". See Golden v Coffs Harbour City Council (1991) 72 LGRA 104 per Stein J at 106-7.Alternatively, the test could be "that a development will be generally consistent with the objectives if it is not antipathetic" to them, it not being necessary "to show that the development promotes or is ancillary to those objectives, nor even that it is compatible". Schaffer Corporation Limited v Hawkesbury City Council ("Schaffer") (1992) 77 LGRA 21 per Pearlman J at 27, in which she followed Talbot J's decision in Challister Limited v Blacktown City Council (1992) 76 LGRA 10. See also Coffs Harbour Environment Centre Inc v Coffs Harbour City Council (1991) 74 LGRA 185 per Clarke JA at 192: "Whatever is their precise ambit the paragraphs do not permit an antipathetic development whether or not it is so placed as to minimise the interference with ...". (All emphasis added).
In Bodyline Spa & Sauna (Sydney) Pty Limited v South Sydney City Council ("Bodyline") (1992) 77 LGRA 432, Stein J said, referring to the situation in that case (at 439):
"In my opinion it may be concluded that this development is compatible with the existing residential development in the zone. I so find on the evidence notwithstanding that I do not accept that a positive finding of compatibility is required. Looked at objectively, and in the planning context, what is required is a finding that the development - taking account of its type and scale - is not incompatible or inconsistent with the residential development." (Emphasis added).
In Hospital Action Group Association Inc v Hastings Municipal Council ("Hospital Action Group") (1993) 80 LGERA 190, Pearlman J had to construe a provision which included the requirement that the Council be "of the opinion that the carrying out of the development is consistent with the objectives of the zone".
Referring to Schaffer and Bodyline, the Chief Judge said:
"It is also important to bear in mind that `consistent' does not mean `conform to' or `promote', and it does not require a positive finding of compatibility". (Emphasis added).
Her Honour commented that many of the cases turn on the reasonableness or unreasonableness of the opinion formed by the Council.
In this case Mr Atkin submits that there is no inconsistency between the current proposal and objectives (a), (b), and (c), (c) being relevant only to the interpretation of (a) and (b).
He submits that nothing in the objectives is defeated by the child care centre proposal.
Contrary to what had been suggested in the correspondence of 14 January 1998 from his instructing solicitors to the solicitors for Council, Mr Atkin did not argue that the proposal was a "light industry", such as is defined in the model provisions.
He submits that the plan, in terms, describes itself as a broad framework of control, so a reasonable degree of latitude is allowed to the Council to determine what particular use might take place within a particular zone e.g. cl 2(2)(h) requires Council "to ensure space is provided for community services and facilities".
Objective (a) requires an area of land to be used for a broad range of light industrial purposes, none being inconsistent with a child care centre.
Atkin also relies upon the fact that the Council did not rely upon previous decisions of the Court in rejecting the application on this occasion.
Further he submits that the issue before the Court is not res judicata. It is a preliminary point of law, raised by Council's solicitor in a new Class 1 appeal, which he (Atkin) chose to argue in a way different from that indicated by the letter of 14 January 1998.
Atkin submits that his question as now raised in these proceedings was never considered by the Court in any of the earlier proceedings.
He contends that there have not yet been any findings in this matter such as he is now seeking the Court to make.
None of the Court's earlier decisions dealt with the question as he has now, he says "properly", posed it: Is the proposed activity "consistent" (or "not inconsistent") with the Light Industrial zoning?
The question is not, he says, whether it is compatible with or promotes the objectives of the zone.
Assessors Bly and Bull found that the child care centre was a commercial activity and they explored objective (c) to test whether it was a commercial activity that provided services within the light industrial zone.
It seems to be now common ground between counsel for both parties that the child care centre is clearly not a commercial activity and that the Assessors may well have been wrong in this regard. However, no appeal was lodged against that aspect of their decision.
In any event, Atkin submits that this is not the same development at all - this proposal does not include the consolidation of two sites, only the use of, and some internal alterations in, one parcel of land. The proposal may be similar to the earlier applications, but it is not the same.
He argues that Assessor Nott accepted the evidence of Layman and found that the development was not consistent with the objectives. He did not come to any conclusion on whether it was permissible as being not inconsistent with the zone objectives. Atkin says this is now the correct factual question for the Court to consider.
Assessors Bly and Bull found that there was no evidence of a demand for a child care centre activity within the 4(b) zone. They further found that the Russo proposal was inconsistent with the zone objectives. (Atkin acknowledges that this is essentially the same finding as that made by Assessor Nott).
Atkin does not challenge any of the previous findings, whether they are correct or not, in these proceedings, but he submits that defining a child care centre as not consistent with the objectives of the zone is not determinative of the question whether it is not inconsistent with those objectives.
He believes the authorities indicate that this is an entirely different question.
7.2 Council's Contentions
It is agreed, and there can be no doubt, that the proposal is for the development of No.1 as a child care centre, whether or not it is directly associated and/or amalgamated with the existing centre at No.3.
Mr Newport's submission on Council's behalf is that, as "child care centre" is relevantly defined, in its own right, in the model provisions, it is not "commercial premises", because they, amongst other things, are buildings or places or offices for business or commercial purposes, but not for a purpose elsewhere specifically defined.
A child care centre is, subject to exceptions, permissible with consent, pursuant to cl 10(2), except as otherwise provided by the plan. An exception is found in cl 10(3).
Clause 10(3) requires the formation of an opinion that the carrying out of the development is consistent with the objectives - it does not say "generally consistent", nor does it say that it must be consistent with only one or more of the objectives. (See Bignold J at 307-8).
Newport submits that the development of a child care centre is repugnant to the objectives, collectively - it is not a use for a Light Industrial purpose (objective (a)); it does not recognise existing or encourage new industry or the establishment of an industry to expand the local employment base (objective (b)); nor is it retail or commercial development on a small scale or otherwise (objective (c)).
Accordingly, Newport submits the proposal is repugnant not only to one of the relevant objectives, which would be sufficient to deny it permissibility, but, indeed, to all three of them.
As a result, the development is not permissible. (See The Ultimate Skirmish Game Pty Limited v Wollondilly Council, 10400 of 1993, Talbot J, 8 October 1993, and Russo v Kogarah Council (1995) 86 LGERA 300 at 304-8).Assessors Bly and Bull found that users of the 4(b) zone were unlikely to utilise the child care facility. The facility was unlikely to be ancillary to or supportive of the industrial zone, it would not be ancillary to other industrial uses and it was not "small scale".
Newport pointed out that the applicant, in preparation for this hearing, conveyed to the Council that he would argue only that the proposal was light industrial.
Whilst Atkin indicated at the beginning of the hearing that he would argue the applicant's case more widely than that, he did not, in the event, argue that the purpose was "light industrial", nor that it was ancillary to "light industrial". He, in fact, argued only consistency with that zoning.
Newport, therefore, relies upon the previous findings that a child care centre is prohibited because it is not permissible and not consistent with the zone objectives.
Assessor Nott found that "child care centre" was not consistent with the objectives of the zone. This is a finding of fact, not simply in respect of the then proposed child care centre, but any child care centre on the relevant site.
Assessors Bly and Bull made similar findings of fact.
No appeals were lodged in respect of the relevant findings of fact in respect of "consistency". Now we have the "same" development being submitted again, the variations being only minor variations in form.
The Court has already decided that this is not the right place for a child care centre. It is not an industry and it is not commercial premises and the development proposed is prohibited. On proper construction of the earlier judgments the use of this land for a child care centre is prohibited.
Newport accepts that one can go behind the ruling of the Court to examine the determination of requisite facts which underpin the determination.
It was integral to the Nott decision that he was finding it was prohibited as not consistent with zone objectives. Bly and Bull found it was not consistent with light industry objectives and, being not consistent with the objectives of the 4(b) zone, the application had to be refused in accordance with cl 10(3).
On the principles in PE Bakers Pty Limited & Ors v Yehuda & Anor (1988) 15 NSWLR 437, ("Bakers"), Burwood Council v P D Mayoh Pty Limited (No.40110 of 1995, Bignold J, 30 November 1995), ("Mayoh"), and Egri & Anor v DRG Australia Ltd (1988) 19 NSWLR 600 ("Egri"), the issue involved before Nott and Bly/Bull, namely consistency, was not a collateral or incidental issue, but the central issue in this case.
Newport sees no distinction in the formulation of the question as "consistent" or "not inconsistent".
8. THE LAW OF RES JUDICATA
8.1 The relevant legal principles
Halsbury's Laws of England, Volume 16, Fourth Edition, paragraphs 964-979 helpfully summarises the relevant principles of res judicata.
Whilst Halsbury relies on British cases, those same authorities have formed the Australian law on this issue. I will not go into the main cases on questions of estoppel and res judicata in great detail, but reference may be had to:
* The judgment of Dixon J in Blair & Ors v Curran & Ors ("Blair v Curran") (1939) 62 CLR 465 at 531-2.
* Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589, where Gibbs CJ, Mason and Aickin JJ (at 598) relied upon Dixon's statement of principle.
* Carl Zeiss Stiftung v Raynor & Keeler Limited [No.2] [1967] 1 AC 853 where the House of Lords also relied upon Dixon J's judgment to express the difference between res judicata and issue estoppel.
* Chamberlain v Deputy Commissioner of Taxation (1987) 62 ALJR 324 in which the High Court drew a clear distinction between res judicata and issue estoppel.
The term res judicata is often used loosely to cover comprehensively all forms of estoppel, but it rests on the fundamental doctrine that Courts must bring an end to litigation.
An action that has not been determined by a final judgment or a decree cannot create any "estoppel by (Court) record".
Even though a judgment might be pleaded by way of estoppel, it is perhaps not strictly correct to regard its determination of legal rights as a question of estoppel. The parties are estopped by the findings of fact involved in a judgment of a competent Court, and their respective rights are as determined by that judgment.Judgments which may give rise to an estoppel may operate either in rem or in personam. Many judgments which fall into the category of judgments in rem deal with the status of persons and not of things. Any judgment which is not a judgment in rem operates as a judgment inter partes (a more accurate description than in personam).
Res judicata is the usual question of estoppel in cases of judgments inter partes, and the defence is usually raised where the former proceedings for the same cause of action by the same plaintiff were resolved in the favour of the defendant.
Where it is pleaded by way of estoppel to an entire cause of action rather than a single matter in issue, it amounts to an allegation that the whole legal rights and obligations between the parties are concluded by the earlier judgment, which may have involved the determination of questions of law as well as the making of findings of fact.
The subject matter in dispute must be the same - the same point must have been decided between the same parties.
For res judicata to succeed as a defence it is necessary to show not only that the cause of action was the same, but also that the plaintiff had the opportunity to recover in the first case, that which he seeks in the second. It is not enough to show that the matter allegedly estopped might have been put in issue or the relief might have been claimed; it is necessary to show that it actually was so put in issue or claimed.
To decide which questions of law and fact were determined in the earlier judgment, the Court is entitled to look behind the orders at the Judge's reasons and notes. (See Somodaj v Australian Iron & Steel Limited (1963) 109 CLR 285).To determine if the estoppel arises one looks to the formal orders and declarations of the Court, but provided one is not seeking to exclude from the scope of such an order any matter which is clearly an issue on the pleadings and/or clearly included in the terms of the order, the Court may go behind the orders and declarations to explore the Judge's reasoning, find any findings of fact or law underpinning the decision and order, and even consider his notes of the evidence.
An issue estoppel may still arise where a plea of res judicata itself could not be established because the causes of action are not the same.
In Egri, the NSW Court of Appeal applied Blair v Curran to find that a final decision given by a competent Tribunal creates an issue estoppel, forever binding the parties and all those who claim through them, in respect of any issue of fact or law which was legally indispensable to that decision.
Clarke JA said at 610:
"It is not a necessary condition of an estoppel arising from such a finding that it be made in the determination of an issue which is identical with the issue in the later proceedings. It is sufficient if the finding, of fact or law or mixed fact and law, is made in respect of an identical question notwithstanding that that question may fall to be decided in the course of the determination of issues which are not identical."
The fundamental principles decanted from all this are that:
* A party is precluded from contending the contrary of any precise point distinctly put in issue and earlier determined against him by a competent Court. It matters not that the object of the first and second actions are different. If the point was directly in issue and was the subject of a finding in the first action, it is conclusive in the second between the same parties and their privies.
* The issue may be one of fact or law, or a mixed issue of fact and law, and the doctrine will apply if:
1. The same question was decided in both proceedings.
2. The judicial decision relied upon to create the estoppel was final.
3. The parties were the same persons.
* It is not necessary that the finding be made in the determination of an issue which is identical in both proceedings. See Egri, but also Jackson v Goldsmith (1950) 81 CLR 446.
8.2 The application of those principles in this Court
In Canterbury Municipal Council v Belshaw & Ors (1982) 46 LGRA 423, McClelland J, the then Chief Judge of this Court, held that a judgment of Kearney J in the Supreme Court, declaring that the existing use of the property for the purpose of a welder's workshop had been abandoned in 1976, established an estoppel against a finding that the existing use for a welder's shop had revived.
In Bakers, proceedings were taken in this Court to restrain breaches of conditions of consent to development approval.
The Court of Appeal held that the issue of such a restraint order resulted in a judgment in rem in respect of the validity of those conditions.
Perrignon J had adjudicated on the validity of four conditions that were challenged. He held that 6 and 8 were invalid, but 3 and 7 were valid and made appropriate declarations and orders (Waverley Municipal Council v P E Bakers Pty Limited & Ors (1985) 54 LGRA 309).
The neighbour (Yehuda) later alleged that breaches of the valid conditions were continuing, despite the declaration and orders of Perrignon J, and, in the absence of Council taking any action in response to his complaints, Yehuda brought proceedings in this Land & Environment Court seeking declarations and an injunction on the basis that the premises were being used in contravention of the plan and the development consent.
Yehuda sought to rely on the decision of Perrignon J as a judgment in rem, precluding the issue of the validity of 3 and 7 being again litigated.
Cripps J decided to consider again the validity of the two conditions, but held them valid, found that the defendants were continuing to breach them, and restrained them accordingly. He did not decide the question of whether or not the decision of Perrignon J was a judgment in rem, even though it is clear that that question was raised in the proceedings before him.
When Cripps J's judgment was appealed to the Court of Appeal, the principal judgment was given by Hope JA, with whom Samuels and McHugh JJA agreed.
Hope JA (at 15 NSWLR 442) discussed the differences between judgments in rem and judgments in personam, and continued (at 445):
" It is not in doubt that an issue, and indeed the principal issue, in the proceedings before Perrignon J was the validity of the conditions attached to the consent. If Perrignon J, in addition to the declaration and orders which he made, had made a declaration that conditions 3 and 7 were valid, I would have no doubt that to that extent his decision would have been a judgment in rem, binding upon everyone. The decision would have been a decision within jurisdiction of a court of record upon which a power to make such declarations has been expressly conferred, the Supreme Court which previously had that power being at the same time denied the right to exercise it. The declarations would have directly affected, in the relevant sense, the status of the land and/or the consent in the same sense that declarations declaring conditions 6 and 8 invalid would have affected that status. However his Honour did not make any such explicit declaration. Is his judgment therefore denied the effect of a judgment in rem?
I do not think that the relevant principles are so inflexible as to depend necessarily upon the precise language used in the judgment being explicitly directed to status, as opposed to the determination in substance of some matter affecting the res. The declaration which his Honour made established that the appellants were in breach of the consent. In the context in which they appear the restraining orders in the second and third paragraphs must be regarded as particularising the respects in which the appellants were committing breaches of the consent, or as identifying the provisions of the consent of which they were committing breaches. On this view the declaration and orders explicitly identified the doing of the acts described in the second and third orders as acts which the interim development order and the consent prohibited, and which the appellants might be restrained from doing.
The liability of the appellants to be restrained by reason of the interim development order and the consent is the very matter which the appellants seek to re-litigate in these proceedings. To argue that conditions 3 and 7 are invalid is to argue that they are not liable to be so restrained. In my opinion they are precluded from doing so by reason of the declaration and orders of Perrignon J, which give rise to a res judicata precluding all persons from denying that the acts described in the orders constitute breaches of the interim development order and the consent. To arrive at this conclusion is not to go behind the declaration and orders to determine the reasoning upon which they must have been based...
It is a matter simply of construing the declaration and orders in their context and identifying the effect which they have in relation to the status of the land and/or the consent."
9. CONCLUSIONS AND ORDERS
A person may legally and properly continue to make identical development applications to a Council, and the Council may consider them individually as if they were completely novel, but the Court does not and should not determine the same legal questions and issues over and over again.
There are in the earlier proceedings in this case no declarations or orders as to the validity or otherwise of consents or planning instruments, only orders of the Court dismissing the appeals against Council's decisions.
Those appeals were dismissed - not on issues of merit, but on the basic question of permissibility.
Further, the Court has twice pronounced on the factual question underlying the permissibility issue, namely that of consistency/inconsistency between the Russo proposal and the relevant zone objectives in the plan.
It appears to me that all three of the fundamental principles of res judicata set out in 8.1 above are satisfied, namely the same question as is now before the Court in this appeal, that of permissibility, has already been decided by the Court; the judicial decision relied upon to assert such an estoppel was indeed final; and the parties are identical.
One can sympathise with Russo's position, and respect his persistence, but I adopt, and adapt to this case, the reasoning of Hope JA in Bakers, which I have quoted at length above in 8.2.
Again on this occasion what Russo has applied for is consent to use No.1 as a child care centre, and the Court has twice determined that such use is not permissible in the zone.
I find no substance or utility in the pedantic approach urged upon the Court by Counsel for Russo, requiring that I distinguish the formulation of the earlier decisions of the Assessors, and that of the question of law now before the Court, on the somewhat esoteric basis of the allegedly contrasting concepts of "consistent" and "not inconsistent".
As Clarke JA said in Egri (at 607):
"The principles are not in doubt but the difficulty lies, as Dixon J pointed out, in distinguishing between those matters fundamental to the decision, or necessarily involved in it as its legal justification or foundation, from matters which are not in point of law the essential groundwork of the conclusion."
In this case the question of permissibility is fundamental to the applicant's position, just as it was in the two earlier appeals.
I do not believe that the proposed child care centre is any more "light industry" than it is "commercial premises".
The proposal's correct characterisation is as "child care centre", defined in the plan, and in order for Russo's application to proceed it must be found to be consistent with the objectives of the relevant zone.
Whether in such cases the tribunal of fact analyses the situation and assesses the proposal against criteria of consistency, inconsistency, compatibility or antipathy, the basic question remains the same.
The Court should in this case adhere to the principles expressed in Schaffer, Bodyline and Hospital Action Group, namely that it does not need to make a positive finding of conformity, promotion or compatibility in order to determine the question whether the proposal is "consistent".
I therefore conclude that all the questions posed in these proceedings have already been answered by the Court, and again on this occasion should be answered in the negative - Mr Russo's proposal is not permissible, and it is not consistent with the zone objectives.
Although posed on this occasion as a "preliminary" question, permissibility is the central issue in the appeal, and I have concluded that the subject matter of these proceedings is, indeed, res judicata.
Russo's proposal is not permissible, and the Court has already so determined. Therefore, on the principles of res judicata, his appeal must fail.
The exhibits may be returned, and there will be no order as to costs.
0
9
3