Glasshouse Creek Poultry Pty Ltd v Caboolture Shire Council
[2003] QPEC 50
•12 September 2003
PLANNING & ENVIRONMENT COURT
OF QUEENSLAND
CITATION:
Glasshouse Creek Poultry Pty Ltd v. Caboolture Shire Council [2003] QPEC 050
PARTIES:
GLASSHOUSE CREEK POULTRY PTY LTD
and
HAXVIEW PTY LTD trading as WAW CONSULTANCY
and BARRY ALLAN BENBOW
and JUDITH MALVENE BENBOW(Appellants)
v.
CABOOLTURE SHIRE COUNCIL (Respondent)
FILE NO/S:
3719 of 2002
DIVISION:
PROCEEDING:
Appeal
ORIGINATING COURT:
Planning and Environment Court Brisbane
DELIVERED ON:
12 September 2003
DELIVERED AT:
Brisbane
HEARING DATE:
4 September 2003
JUDGE:
McLauchlan QC
ORDER:
Appeal refused
CATCHWORDS:
‘Family Reasons Sub-division’ - Transitional Planning Scheme – ‘owner’
COUNSEL:
Mr S Sheaffe for the appellant
Mr S Ure for the respondent
SOLICITORS:
Appellant: Colwell Wright
Respondent: King and Company
This is an appeal against the refusal by the respondent, on 6 August 2002, of an application for a “family reasons subdivision” on land situated at Storr Road, Donnybrook, being Lot 1 on SP113232, Parish of Toorbul. The last named appellants are the sole shareholders and directors of the first named appellant.
The reason given by the respondent for refusal of the application was stated as follows:
“The application does not comply with Part 4, Section 18(9) of the Transitional Planning Scheme, as the owner of the property is a company and approval would create an undesirable precedent in the Rural zone.”
The disputed issues in the appeal were identified by the respondent by its solicitors as being the following:
“1The appellant has not and cannot comply with the requirements of Part 4, Section 18(9) of the respondent’s Transitional Planning Scheme in that:-
(a)The owner of the land the subject of the application is a company. The person for whose benefit the subdivision is being sought is not capable of being a ‘… spouse, child, mother or father of the owner, or mother or father of the spouse’ of the owner.
(b) The statutory declarations that accompanied the subdivision application apparently lodged in compliance with Section 18(9)(e) of the respondent’s Transitional Planning Scheme, contained no reasons for the proposed subdivision.
2. The only reason advanced by the applicant for the subdivision is contained in a letter from the appellant to the respondent dated 5 November 2001 stating: -
‘The reason for the subdivision is to enable Mr. and Mrs. Benbow’s son, Damien, to reside in a house that has already been constructed on the land … Damien Benbow works for the family poultry farming business and it is necessary for him to reside close to the farm to be on call when needed.’
A subdivision is not required to allow Mr. and Mrs. Benbow’s son to reside in the house that is already constructed on the land. A subdivision is not required to allow the son to reside close to the farm to be on call when needed.
3. No valid planning reasons exist to justify the proposed subdivision.
4. The proposed subdivision will result in the unnecessary fragmentation of an existing rural holding.
5. The proposed subdivision will result in the creation of an additional parcel of land which is capable of separate disposition. Future owners of the new parcel need not be related to the current owners of the subject land, nor be sympathetic to the poultry farming activities conducted on the balance land. This creates the potential for future amenity conflict between the intensive rural use on the balance land and what will be, in all likelihood, a residential use on the parcel that would be created by the proposed subdivision.”
The issues nominated by the appellants by their solicitors are, in substance, comprehended by the above issues, except for a further issue which reads:
“That the rejection of the Application for family reasons subdivision was not made on sound Town Planning reasons, but on the decision maker’s discrimination towards the applicant Haxview Pty Ltd trading as WAW Consultancy.”
The allegation of discrimination on the part of the respondent was not substantiated by the evidence, and in any event is of little if any relevance in the appeal, because the appeal is a re-hearing of the application.
The land proposed to be subdivided contains an area of 16.88 hectares. Existing improvements include two modern low-set brick dwellings, and five poultry sheds together with a farm machinery shed. In February 2003 the respondent granted a Material Change of Use approval for five additional poultry sheds. The application for reconfiguration which was made on 5 November 2001 was to excise from the allotment a 2.02 hectare allotment containing one of the two dwelling houses, the other to remain on the balance 14.86 hectares along with the existing and approved poultry sheds.
The appellant company carries on a business of fattening chickens for consumption, in the sheds to which reference has been made. It appears that these sheds cost in the neighbourhood of $400,000 each to erect, and each cater for approximately 31,000 chickens. The chickens are owned by Inghams, who also provide food for use in the fattening process. The chickens are collected after a certain period before processing by Inghams.
Mr. Benbow Senior is also in the business, in a partnership, of supplying poultry equipment to the poultry industry and associated activities. It seems that the chicken fattening business was undertaken by the corporate appellant, rather than the Benbows, mainly to distinguish it from the other business, without any particular thought being given to the possibility of simply using a different business name.
The farm was purchased, and the business commenced, late in 1998. The first home was built on the property in 1999 and is occupied by Mr. and Mrs. Benbow. The second home was built in about September 2001 and was occupied by Damien Benbow who managed the farm operations from the outset until approximately four weeks ago, when he left the property and took up employment as a cabinet maker. When managing the property it was necessary for him to reside there and to be there or available seven days a week. There are also two casual staff engaged in maintenance work and other duties. Damien has been replaced as the manager for the time being. When, however, the remaining five sheds are constructed, and in operation, which depends upon the company entering into a further contract with Inghams to raise additional chickens, it is Damien’s intention to return to the property because there will then be a need for two managers. It was his intention, and the intention of his parents, that the house in which he proposes to reside with his family should become his property by subdivision and transfer of the 2.02 hectare lot already referred to upon which the house stands. He already owns a house within the Caboolture Shire which he would then retain simply as an investment property.
Ultimately it is proposed to construct a third dwelling house on the property which will be occupied by Mr. and Mrs. Benbow, so that there will then be accommodation for them and for the two managers required to operate the business. It was made clear in evidence that the object of transferring the smaller lot and house to Damien was to provide him with incentive to reside on the property and assist in the management of the business, rather than to simply enable him to reside on the property for that purpose which could, of course, be achieved without his acquiring the ownership of the house and the proposed allotment.
The land is included in the Rural zone pursuant to the Transitional Planning Scheme. The majority of the site also falls within the Rural Preferred Dominant Land Use designation in the respondent’s Strategic Plan.
Rural Objective 1 is to:-
“… preserve good quality agricultural land and legitimate rural uses by preventing the intrusion of non-rural activities into these areas.”
Implementation Criterion (b) states:
“(b)Application to facilitate non-rural uses in areas designated as Rural on the Strategic Land Use Plan map will not be considered favourably by Council where the subject land is good quality agricultural land, or where the approval of the uses would prejudice the activities or functions of a legitimate rural use.”
The evidence does not establish that the approval of the application “would” prejudice the activities or functions of the chicken farm. The possibility of disputes arising out of the juxtaposition of a rural and a non-rural use does exist, however, in the event that the newly created allotment were transferred to somebody else. It appears from the report of Mr. Ryter, a town planner called for the respondent, that the Department of Local Government and Planning has issued a policy position paper in respect of “discretionary rural subdivisions”. The paper refers to the “long-held policy position of the Department not to support discretionary rural (family) subdivision provisions in family schemes; and the paper goes on to say:
“It (the Department) will continue to advise local governments and consultants preparing IPA planning schemes, that provisions which permit discretionary rural subdivisions and similar discretionary rural lots, will be required to be removed before Ministerial sign-off occurs.”
While approval of the application has the potential to cause problems which the Strategic Plan is concerned to avoid, I do not consider that actual conflict with the Strategic Plan in that respect is established.
The Transitional Planning Scheme provides that with respect to land in the Rural zone the minimum area, minimum average width, minimum frontage to a road and minimum average depth to average width ratio that shall be permitted in a subdivision of land for any purpose shall be:-
minimum area – 16 hectares
minimum average width and frontage to a road – 200 metres
maximum average depth to average width ratio – 5 to 1
This requirement is however qualified (relevantly) by the provisions of Clause 18(9) which provides as follows:
“(9) In the subdivision of land in a Rural Zone the Council may at its discretion and subject to such conditions as it may determine, permit an allotment having an area of not less than 4,000 square metres to be subdivided from the property if a house has been or is to be erected on the allotment by the owner for the spouse, child, mother or father of the owner, or mother or father of the spouse. No further allotment will be so approved by the Council until a house has been erected on the allotment first so subdivided. This discretion shall be subject to the following conditions:
(a) The balance area of the allotment is at least 4 hectares;
(b) The minimum average width and road frontages of the lot to be excised shall be 40 metres;
(c) In the subdivision of land for the purposes of this by-law (hereinafter referred to as ‘a family reasons subdivision’) Council will require a contribution to external works similar in all respects to those applicable in all other subdivisions;
(d) An applicant to qualify for approval of a family reasons subdivision must have been the registered proprietor of the land to be subdivided for a continuous period of two years immediately preceding the date on which such application is made and shall remain so registered until or be so registered as at the date of approval of a family reasons subdivision and further immediately prior to the approval of such a subdivision the applicant shall satisfy the Council that the applicant/owner is ordinarily and permanently resident on the subject land;
(e) The sub-division application must be accompanied by a statutory declaration setting out the reasons for the proposed subdivision and the name of the person to whom the new lot is to be transferred; and
(f) The allotment to be excised shall meet a soil absorption test as required by the Shire engineer.”
It is common ground in this appeal that the land from which the 2.02 hectare allotment is proposed to be subdivided is owned legally and beneficially by the corporate appellant, Glasshouse Creek Poultry Pty Ltd. It is also clear that a house has relevantly been erected on the allotment. However, it clearly cannot be said that the house has been erected on the allotment by the owner “for the spouse, child, mother or father of the owner, or mother or father of the spouse”. Moreover, it is impossible for the Council to be satisfied that the owner “is ordinarily and permanently resident on the subject land”. A corporation cannot have a child and it cannot ordinarily and permanently reside anywhere, although of course it will maintain a registered office at some address. It was urged that the “corporate veil” should be lifted so that the benefit provided by the provision to an owner and his child should be extended to a principal shareholder and director of the company which owns the land and his child, upon the basis that the creation of a company to hold the legal and beneficial ownership of the land was merely a form employed by Mr. and Mrs. Benbow, and that in substance and practical reality the land was owned by them, the company being merely their alter ego.
This submission does not take sufficient account of the separate legal personality of a limited company from that of its shareholders or incorporators. There are some circumstances in which the law will look behind the corporate form to its shareholders, particularly where it is clear that to do otherwise would defeat the intent of the provision being examined. There is, however, nothing in the provision presently being considered to suggest that the respondent intended clause 18(9) to have any greater reach than the words employed naturally convey. Nor were any reasons of public policy suggested which might persuade the Court to take that course.
Reading the clause as a whole, it is evident that the expression “owner” in the earlier part of the clause is intended to have the meaning “registered proprietor” which is used in sub-clause (d). In my opinion, it is clear that the clause only contemplates a situation in which the registered proprietor of the land is a natural person who has erected on the proposed allotment or intends to erect on the allotment a house for the benefit of a person standing to him in any of the family relationships stipulated in the clause.
Moreover, it is a condition of the exercise of the discretion conferred by the clause on the Council, that the subdivision application be accompanied by a statutory declaration setting out the reasons for the proposed subdivision: sub-clause (e). The two statutory declarations accompanying the application do not state any particular reason for the subdivision unless one can be inferred from Damien’s declaration that: “I am currently residing in the dwelling that has already been constructed on the new lot to be created”.
It is true that the respondent might have expanded the meaning of the expression “owner” to include a person who was the controlling shareholder and director of a proprietary limited company which was the registered proprietor of the land in question. Such a provision might be quite complex if an attempt were made to actually draft one, but in any event, the fact that such a provision might have been made, but was not, is no argument for reading the provision as a whole as if that had in fact been done.
The evidence indicated that there had been in the order of 53 applications for a family reason subdivision approved over a 10 year period, including one where the applicant was a company. No other evidence was given concerning that particular application and it cannot be inferred that there was a deliberate departure from the Planning Scheme on that occasion by the respondent. It may be noted that the Transitional Planning Scheme had the force of law when it was published in the Gazette, as did the relevant amendment to the Planning Scheme from the date of commencement of the relevant Order in Council, viz 14 May 1993. In my opinion, as a matter of law, the discretion reposed in the Council under clause 18(9) was not enlivened by an application from a company which was the registered proprietor of the land in question, and the grant of approval in that case was contrary to the Planning Scheme, and therefore contrary to law.
There is also evidence before the court to the effect that some 35% of the allotments excised pursuant to a family reasons subdivision have been sold on to third parties by the original transferees of those allotments.
In my opinion, the application made to the respondent in the present case was such that the respondent was not entitled by the Planning Scheme to entertain the application in the exercise of its discretion. It follows that the court cannot exercise any such discretion in relation to the application either. It is not entirely clear, but it seems that the respondent, at least arguably, took the view that it did not have power to entertain the application, because the stated reason for refusing the application was as follows:
“The application does not comply with part 4, s.18(9) of the Transitional Planning Scheme, as the owner of the property is a company and approval would create an undesirable precedent in the Rural zone.”
For the foregoing reasons, the appeal is refused.
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