Hope Island Resort Holdings v Bridge Investment Holdings Pty Ltd

[2004] QPEC 3

PLANNING & ENVIRONMENT COURT
OF QUEENSLAND

CITATION:

Hope Island Resort Holdings v Bridge Investment Holdings Pty Ltd & Anor [2004] QPEC 003

PARTIES:

HOPE ISLAND RESORT HOLDINGS
Appellant
v
BRIDGE INVESTMENT HOLDINGS PTY LTD
Respondent
And
HOPE ISLAND RESORT PRIMARY THOROUGHFARE BODY CORPORATE
First Co-Respondent
And
HOPE ISLAND RESORT PRINCIPAL BODY CORPORATE
Second Co-Respondent

FILE NO:

4533 of 2003

DIVISION:

Planning & Environment

PROCEEDING:

Application

ORIGINATING COURT:

Brisbane

DELIVERED ON:

25 February 2004

DELIVERED AT:

Brisbane

HEARING DATE:

19, 20 February 2004

JUDGE:

Skoien SJDC

ORDER:

Declaration made

CATCHWORDS:

Approved scheme under Integrated Resort Development Act 1987; meaning of “principal development”, “some”, “any”; exercise of discretion

COUNSEL:

Mr GJ Gibson QC for applicant
Mr PJ Lyons QC with Mr RS Litster for respondent
Mr AM Daubney SC with Mr BD Job for first co-respondent

Mr CL Hughes SC with Mr JJ Haydon for second co-respondent

SOLICITORS:

Deakins for applicant
Corrs Chambers Westgarth for respondent
McCullough Robertson for first co-respondent
Mullins Law for second co-respondent

1. The first respondent (“Bridge”) is the owner of about four hectares of land (“the site”).  It is part of the Hope Island Resort at Hope Island on the Gold Coast, which has been developed pursuant to an approved scheme under the provisions of the Integrated Resort Development Act 1987 (“IRDA”). In the Scheme the site is the larger part of Precinct 7 of the resort. Bridge is currently proposing an extensive residential development on the site.

1. Since about June 2000 the applicant (“HIRH”) has been the owner and developer of the balance of the resort, which contains about 360 hectares.  Of the approximately 2000 intended residential lots, about 1,100 have been sold and many built on.  A golf course and country club, a tennis complex, a marina, a yacht club, a shopping village and a tavern have been completed and are operating.

1. HIRH seeks a declaration that Bridge’s proposed development of its site is unlawful.

The Proposal

1. At all material times the site has had on it an apartment building, four storeys high, containing 25 self contained apartments.  It was built by a previous owner of the site as the first building of an intended retirement village but Bridge acquired the site (on 11 April 2003) free of any obligation to pursue that intention or to use the existing building for that purpose.  On 21 May 2003 Bridge subdivided the site into six group title lots plus common property, lot 1 containing the existing building.

1. The site lies along Springfield Drive, one of the main entry roads to the resort, and is the road which leads to the established golf clubhouse.  While there are several other entries to the resort this is an important one as it constitutes a “front door” to the resort.

1. Bridge proposes to construct on the five balance group title lots six more four storey apartment buildings, each containing 32 units, together with fourteen detached houses.  All told there will be 231 residential units.  There is also to be a community building and a swimming pool.  The consultant town planner for HIRH, Mr Brannock has, in his report, made calculations of the likely residential density, total floor area, plot ratio and building dimensions, which do not seem to have been challenged, nor his conclusion that the result could be described as medium density residential development.  Certainly the site plan prepared for “Palisades” (as the proposed Bridge development has been named) suggests to me that when fully built as proposed there would be little room for any further buildings or other land use.

IRDA

1. IRDA came into existence at a time when, as it notorious, the State Government of the day was actively promoting private enterprise development of the State for tourist (and other) purposes. To that end it passed various enabling Acts which wholly or in part, provided a code of development for particular proposals. One such proposal which was to be encouraged was the establishment of resort developments. So the long title for IRDA is:

An Act to provide for the approval of schemes of integrated resort development, to make provision to assist in the establishment, operation and management of approved integrated resort developments and for other purposes.

1. Section 3 sets out what are described in the heading to the section as the “minimum requirements” for an approved scheme.  Relevantly the section provides:

“3(1)       Subject to subsection (3), a scheme shall not be an approved scheme unless it provides for at the least

…

(c)       the division of the site into precincts specifying the name of the precincts, the intended development generally of each precinct and the permitted uses of the land within land precinct;

(subsection (3) requires the provision of similar details when approval of a subsequent stage is sought)

1. Section 4 provides that an application for approval of a scheme is to be made to the Minister, setting out the very detailed information specified in the Schedule, Part A.  The Minister may require further technical information of the type set out in the Schedule, Part B.  In general the Schedule information requirements are like those which would be required in a development application to a Local Government.

1. If the Governor in Council approves the scheme, with or without modification, it is gazetted (s.7), and noted on relevant local government planning documents (s.8).  Then s.15, under the heading “Effect of approval of scheme”, provides:

Approved scheme regulates development etc. of site15.        

(1)        The approved scheme regulates the development and use of land within the site.

(2)        The approved scheme modifies any planning scheme in force in relation to the site to the extent the planning scheme is inconsistent with the approved scheme.

(3)        However, the approved scheme cannot increase the uses permitted by the planning scheme.

(4) The provisions of the Integrated Planning Act 1997 about reconfiguring a lot do not apply to the site.

(6)       Local laws made by a local government under any Act do not apply to the site so far as they are inconsistent with this Act or the approved scheme.

(7)       Any land, building or structure may be used within a precinct without the consent of the local government for any of the purposes set out in the approved scheme as a permitted use in relation to the precinct.

(8)       A person must not use land, or a building or other structure, within a precinct for a use that is not a use specified in the approved scheme as a permitted use in relation to the precinct.

Maximum penalty for subsection (8) – 200 penalty units.

There is no existing subsection (5).

1. Upon registration of the initial plan of subdivision of the land the Primary Thoroughfare Body Corporate (i.e., here the first co-respondent) is incorporated (ss.2,102) with the rights and duties specified in ss.101 et seq.  Similarly, registration of the first plan of subdivision creating lots in a residential precinct incorporates the Principal Body Corporate (here the second co-respondent) with the rights and duties specified in ss.138 et seq.

1. Although Bridge resisted the late joinder of the co-respondents, on the hearing of the application there was no argument advanced that either of them lacked any genuine interest in the outcome.  So it is sufficient if it is simply understood that the second co-respondent represents the owners of residential precinct lots and that the first co-respondent represents the rest of the lot owners.

The Scheme

1. An IRDA scheme for the development of the Hope Island Resort was approved on 13 February 1992 and duly gazetted (“the Scheme”).  The Scheme (as it has been at all material times) contains the following relevant sections:

“2.00Precincts 

The scheme of integrated resort development is divided into the following precincts:

Precinct 1           Primary Thoroughfare Precinct

Precinct 2           Residential Precinct

Precinct 3           Hotel, Clubhouse and Resort Living Precinct

Precinct 5           Golf Course Precinct

Precinct 6           Harbour and Marine Precinct

Precinct 7           Sports and Cultural Precinct

The scheme of development provides for six Precincts within which certain uses are permitted.

Any land, building or other structure may be used for any one or more of the uses permitted within a Precinct as provided for in this scheme of development.  A use which is not permitted within a Precinct is prohibited in that Precinct.

3.07Precinct 7 - Sports and Cultural Precinct 

The principal development intended for the sports component of this Precinct is a range of indoor and outdoor recreation facilities including:  facilities for sports coaching; treatment of sporting injuries; fitness assessments; food and beverage outlets and pro-shops.  The facility may consist of a club, membership of which would be generally available.

The principal development intended for the cultural component of this Precinct is a range of facilities to provide opportunities for the promotion of drama, art, dance, music, crafts and other cultural pursuits.

Facilities will include:  cultural workshops, retail outlets, licensed food and beverage outlets and performance areas.

Some residential accommodation is also intended for this Precinct including a retirement community and associated facilities provided incompatible land uses are separated or are appropriately designed to ensure residential amenity is maintained.

Uses permitted in this Precinct are as listed in Section 4.00.

4.00Permitted uses in Precincts 

The scheme of development provides for nine Precincts within which certain uses are permitted.  The permitted uses in each precinct are set out in the following Precinct Uses Table and are denoted by an ‘x’ immediately opposite the uses and below the relevant precinct.

Any land, building or other structure may be used for any or all of the uses permitted within a Precinct as provided for in this scheme of development.  A use which is not permitted within a Precinct is prohibited in that Precinct.”

1. I do not propose to set out all of the permitted uses in the Precinct Users Table for Precinct 7.  They total forty six and include accommodation units, duplex dwelling, dwelling house and rental accommodation, which are residential uses.  In the remaining forty two, which are not residential, there are such permitted uses as communications facility, gaming facilities, licensed premises, offices, private recreation, public recreation, public utility, shops and storage facility.

1. The Scheme is itself a statutory instrument, Statutory Instruments Act 1992, s.7.

Interpretation of IRDA and the Scheme

1. In relation to the interpretation of statutes generally, in Project Blue Sky Inc & Ors v Australian Broadcasting Authority McHugh, Gummow, Kirby and Hayne JJ stated:

“The primary object of statutory construction is to construe the relevant provisions so that it is consistent with the language and purpose of all of the provision of the statute (see Taylor v Public Service Board (NSW) (1976) 137 CLR 208 at 213, per Barwick CJ). The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole” (Cooper Brookes (Woollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320, per Mason and Wilson JJ. See also South West Water Authority v Rumble’s [1985] AC 609 at 617, per Lord Scarman, “in the context of the legislation read as a whole”.  In Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397, Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning then the logic with which it is constructed’. Thus, the process of construction must always begin by examining the context of the provision that is being construed (Toronto Suburban Railway co v Toronto Corporations [1915] AC 590 at 597; Minister for Lands (NSW) v Jeremias (1917) 23 CLR 322 at 332; K&S Lake City Freights Pty ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 312, per Gibbs CJ; at 315, per mason J; at 321, per Deane J.

A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals (Ross v The Queen (1979) 141 CLR 432 at 440, per Gibbs J). Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions (see Australian Alliance Assurance Co Ltd v Attorney-General (Q) [1916] ST R Qd 135 at 161, per Cooper CJ; Minister for Resources v Dover Fisheries Pty Ltd (1993) FCR 565 at 574, per Gummow J). Reconciling conflicting provisions will often require the Court “to determine which is the leading provision and which is the subordinate provision and which must give way to the other” (Institute of Patent Agents v Lockwood [1894] AC 347 at 360, per Lord Herschell LC). Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme.

1. It is therefore pertinent to consider the purpose of the legislation (both IRDA and the Scheme), read as a whole.

1. The purpose of IRDA is, I think, clear from its historical content (para [7] above) and from its language. It is instructive also to have regard to the second reading speech of the Honourable RJ Hinze, the relevant Minister. Parliament intended to facilitate the creation of resorts to act as magnets for both permanent residents (especially for previously non-Queensland residents) and for holiday visitors (especially for non-Queensland and non-Australian residents). To develop such resorts would create employment as would the management and conduct of them, to the benefit of its economy generally and particularly of local people. It presumably was considered that the passing of an Act would make for quicker and easier approval of large scale resorts than the traditional approach to the appropriate local government.

1. Furthermore I think it is obvious that Parliament intended, in order for a resort to be successful, that is, appealing both to permanent and temporary users of it, that a resort should be large enough to provide a range of attractions.  That it should be large appears from the requirement that it contain precincts.  That it should provide a range of attractions appears from a number of things.

1. First, there is the fact that both the short and the long title of IRDA use the term “integrated”, a word which encompasses concepts such as a combination or composite of dissimilar but complementary things. This is specifically stated in the second reading speech. Next there is the fact that the wording of s.3(1)(c) suggests that the precincts are to have varying forms of development.

1. Then it is clear that the Governor in Council approved a scheme which did indeed specify (now) six precincts, each of which has, so far as their titles go, a quite different intended development from each of the others.  When one looks at those six described intended developments one sees immediately that a mix is provided which would offer a balanced lifestyle to resort occupants and would for that reason be attractive to many people.

1. Of course Precinct 7 has been provided with a sports component on a detached two hectare section in the form of a tennis centre (and a golf course is in operation on Precinct 5) but some interested purchasers or renters of residential lots in the residential precincts might be attracted by other sporting facilities, for example, a bowling green or a squash court (see the definitions of “public recreation” and “private recreation” in s.8.00 of the Scheme).  The site could physically accommodate those uses.  Similarly, those interested in cultural pursuits might be attracted by the provision of an arts and crafts centre, a conference facility/convention centre or the many other cultural uses contained in the definitions of public and private recreation.  The site could physically accommodate those uses.  All of the examples I have given are expressly permitted by s.4 of the Scheme.

1. In my view, any interested person who looked at the name given to Precinct 7 (Sports and Cultural), who read s.3(1)(c) of IRDA and particularly s.3.07 of the Scheme (which speaks of the “principal development intended for the sports component of this Precinct” and the “principal development intended for the cultural component of this Precinct” (in each case setting out examples of how that principal development may be carried out) and who put that into the context of the Scheme as a whole, would conclude that when developed Precinct 7 would be the area to which he/she could repair to enjoy a range of sporting and cultural activities.

1. In my view, that interested person, reading s.3.07 as a whole, would appreciate that Precinct 7 is likely also to contain “some” residences, which that person would interpret as being in a minor proportion or scale.

1. At first I was of the view that the use of “some” in the fourth paragraph of s.3.07 of the Scheme necessarily meant a number or quantity less than half.  However Mr Lyons QC, for Bridge, reminded me that the word is not necessarily confined to that meaning.  Rather, it means an unspecified or unknown number of things or quantity of a thing, and therefore can be a number or quantity approaching “all”.

1. But again the context indicates that in s.3.07 that interpretation is not correct.  Where a provision refers to the “principal development” in relation to the cultural component and follows that by saying “some residential accommodation is also intended for this Precinct” (my emphasis) the indication is clear that the residential accommodation is to be but a minor adjunct to the cultural pursuits.

1. Mr Lyons’ main submission was based on a particular interpretation of s.15(7) of IRDA aided by a consistent interpretation of s.4.00 of the Scheme. His submission was that s.15(7) of IRDA and ss.2.00 and 4.00 of the Scheme permit expressly the use of “any land” within a precinct for any of the purposes set out in the Scheme as an approved use. Section 4.00 permits various residential uses so any land can be used for that purpose and, as a matter or logic, if any land can be thus used, so can all land in the precinct.  The dictionaries agree that such a meaning of “any” is part of English usage.

1. In my opinion the key to the interpretation of s.15(7) of IRDA is to look at it in the context of the section as a whole. Thus:

Subsection (1) applies the scheme to the development and use of the site.  That application is stated emphatically, without qualification;
Subsection (2) explains the application of the scheme a little by emphasising its effect on local government planning schemes which would otherwise have applied to the land in question;
Subsection (3) provides a restraint on the scheme;
Subsection (4) removes any doubt about the application of the Integrated Planning Act 1997 with respect to lot reconfiguration;
Subsection (6) explains the application of local laws to a scheme;
Subsection (7) states that if a use which is permitted under clause 4.00 should happen to be one which could only, for land not in a scheme, be carried on with the consent of the local government, then for land in a scheme such consent is not required.  In other words it emphasises that consent applications are not required for scheme land development;
Subsection (8) prohibits (with criminal sanctions) uses in scheme land which are not permitted under clause 4.00.

1. Thus I do not read s.15(7) as a warrant to read down the primacy of the “principal development” references in s.3.07. Having concluded that, it is difficult to see that ss.200 and 4.00 could achieve that result. In my opinion they cannot, as that would contradict the overall intent of IRDA and the Scheme.

1. I note in passing that the second paragraph of s.4.00 literally purports also to allow “any land in a precinct to be used for all of the permitted uses.  With respect to the drafter it is most unlikely that any land could accommodate them all and it probably adds nothing to the ability to use the land for “any” of the uses.  In any event no argument was put to me on this point.

1. Counsel for the co-respondents used their ingenuity to reduce ad absurdum the arguments of Bridge by pointing out that, taken to their logical conclusion, the site could be wholly developed (for example) as a communications facility or a public utility (e.g., a radio and TV repeater station or a coal powered electricity generation station). Such examples reinforce the view I take of the proper interpretation of IRDA and the Scheme.

1. A further submission advanced by Mr Lyons was that his interpretation of the right to develop any of the permitted uses over any proportion of the whole site (up to 100% if desired) made for certainty whereas restriction simply to a particular principal development led to the uncertainty of not knowing the required proportion to be applied to that development.  In my opinion, to the contrary, on the construction I prefer there is the certainty that Precinct 7 will principally be developed for sport and culture, whereas the alternative would provide no certainty at all, simply a large range of possibilities.  As to the “required proportion”, it can only be said that Bridge, having bought the site knowing what conditions the law applies to it, is bound to obey the law.

1. It is my view that the proposal of Bridge is unlawful.  There remains the question whether I should exercise my discretion to make the declaration which has been sought.

Discretion

1. Mr Lyons submitted that even if Bridge’s proposal were held to be in breach of the law I should exercise my discretion against making the declaration sought.  That I have a broad discretion is not challenged.

1. Mr Lyons based his submissions on the following facts which the material establishes.  HIRH owned the resort before Bridge bought the site.  At that time HIRH knew of the proposed retirement village development for Precinct 7 and knew that some 150 residential units were envisaged.  In July 2003 HIRH wrote to Bridge’s agents acknowledging the abandonment of the retirement village plan and the possibility of creating “some additional lot yield” over and above the 150 apartments previously proposed.  HIRH offered to “attempt to increase densities within the precinct to create this additional yield”, and to act as project manager.  On 16 October 2003 Bridge conclusively rejected the management offer and it was only then that HIRH sought legal advice and brought this application.

1. On behalf of HIRH it is sworn by Mr Saba (and there was no cross examination of him) that the retirement village was, to the belief of HIRH, to contain no more than 150 units, and not until 11 February 2004 did Bridge’s current intention to build 231 accommodation units become known to HIRH.  Mr Saba advances reasons to suspect that the quality and appearance of the accommodation units proposed for the site will be below the standard set for the residential precinct of the resort, to the detriment not only of HIRH but of existing lot owners within the resort.  He swears that his concerns were expressed to Bridge on 10 July 2003.  He swears that on 29 September 2003 he was told of Bridge’s intention to construct a further 50 units (that is, a total of 200) to which he expressed concern and which led him to seek legal advice.  This application was filed on 22 December 2003.

1. Whether those facts would establish that HIRH stood by in the knowledge that Bridge was intending to breach the terms of the Scheme is difficult to say.  It seems clear that HIRH was prepared to stand by whilst Bridge developed residential units somewhat in excess of 150 but it is equally clear that the suggestion of 200 caused it to take legal action and obviously the suggestion of 231 has agitated a more vigorous objection.  If this were an action strictly inter parties the question whether HIRH acquiesced in Bridge’s intentions might be difficult to resolve.

1. However this is not an action inter parties. It concerns the proposed breach of statutes, IRDA and the Scheme. They are not statutes of general application throughout the State of Queensland but their scope (that is, to the Hope Island Resort) would be comparable, in terms of the number of people and the value of assets concerned, with many Local Government planning schemes. Therefore they can be regarded as statutes affecting the public.

1. In Woolworths Ltd v Campbells Cash and Carry Pty Ltd (1996) 92 LGERA 244 (New South Wales Court of Appeal), at 261 Cole JA said:

“In my opinion once it has been established that there are significant breaches of the planning consents, as has been established, the respondent should be restrained from continuing such breaches.

Significant matters were put in opposition to that.  The Court was reminded that the application for relief was brought by a competitor, Woolworths.  The proceedings had been commenced in December 1990, heard in March and April 1992 with a decision being given in May 1993.  The appeal has taken three years to come on.  Further it was said that the unauthorised activity was of limited nature, and had an insignificant effect on the planning system and its administration. Further it would affect in a significant way the respondent’s business.  it was contended that persons should not be forced to purchase goods from Campbell’s competitors, including Woolworths.

These matters are entitled to appropriate weight.  However, the extent of unpermitted use is significant, as is the breach of the planning laws. The planning laws are proclaimed and enforced in the protection of the public interest:  see Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335 at here 339; 63 LGRA 361 at 365 per Kirby P.  Where significant breach continues, as here it does, strong countervailing circumstances would be required before a court should fail to enforce the planning consent.”

1. In Woolworths Ltd v Warehouse Group (Australia) Pty Ltd (2003) 123 LGERA 341, Lloyd J said:

“The principles governing the exercise of the Court’s discretion are explained by Kirby P in Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335; 63 LGRA 361.  Considerations described by Kirby P (at 339-340) which are of particular relevance in the present case are the facts that the relief sought is the enforcement of a public statute; the Act permits any person to bring proceedings in the Court for an order to remedy or restrain the breach (s 123 of the EP&A Act); there is a legislative purpose of upholding, in the normal case, the integrated and co-ordinated nature of planning law, in order to secure equal justice; and it is the intention of the Act that, normally, those concerned in development and the use of land will comply with the legislation.  Moreover, as Kirby P explained, if unlawful exceptions and exemptions were condoned, the equal and orderly enforcement of the Act could be undermined; and a sense of inequity could then be felt by those who complied with the requirements of the Act.”

1. Those principles are compelling.  Apart from the general considerations, it is necessary only to mention the fact that the residential lot owners represented by the second co-respondent, whose dwelling houses are subject to strict control under the Scheme By Laws would justifiably feel aggrieved if similar standards were not imposed on a large residential area in Precinct 7 of the resort which, because it is not a residential precinct, are not subject to those restrictions (IRDA s.176).

Conclusion

1. In the exercise of any discretion I am prepared to make the declaration sought.