Iris Diversified Property Pty Ltd v Randwick City Council

[2010] NSWLEC 58

Reported Decision: 173 LGERA 240

Land and Environment Court

of New South Wales

CITATION:	Iris Diversified Property Pty Ltd v Randwick City Council [2010] NSWLEC 58 This decision has been amended. Please see the end of the judgment for a list of the amendments.
PARTIES:	APPLICANT Iris Diversified Property Pty Ltd RESPONDENT Randwick City Council
FILE NUMBER(S):	10004 of 2010
CORAM:	Pain J
KEY ISSUES:	QUESTION OF LAW :- legislative amendment restricting change of existing use to conforming use only - whether assessment of conforming use against development standards in environmental planning instrument derogates from incorporated provisions in EP&A Act - whether cases decided before amendment should apply
LEGISLATION CITED:	Environmental Planning and Assessment Act 1979 s76A, s76B, s79C, s106, s107, s108 Environmental Planning and Assessment Amendment (Existing Uses) Regulation 2006 Environmental Planning and Assessment Amendment (Existing Uses) Regulation 2007 Environmental Planning and Assessment Regulation 2000 cl41(1), cl42, cl43, cl44, cl45 Environmental Planning and Assessment Regulation 1980 cl 54(1) Interpretation Act 1987 s2(e), s33, s34(1) State Environmental Planning Policy No 1 Sydney Regional Plan No 5 Randwick Local Environmental Plan 1998
CASES CITED:	Berowra RSL Community and Bowling Club Limited v Hornsby Shire Council (2000) 114 LGERA 345 Brown v Gosford City Council (2006) 143 LGERA 311 Carden v Willoughby Municipal Council (1985) 56 LGRA 366 Council of the City of Parramatta v Brickworks Ltd (1972) 128 CLR 1 Cranbrook Schoolv Woollahra Municipal Council (2006) 66 NSWLR 379 Dorrestijn v South Australian Planning Commission (1984) 54 LGRA 99 Fabcot Pty Ltd v Hawkesbury City Council (1997) 93 LGERA 373 Fodor Investments Pty Ltd v Hornsby Shire Council (2005) 141 LGERA 14 Hunt v Blacktown City Council (2001) 116 LGERA 356 Kremer & Associates v North Sydney Municipal Council (1982) 47 LGRA 209 Marshall v Director-General, Department of Transport (2001) 114 LGERA 389 Masterbuilt Pty Limited v Hornsby Shire Council [2005] NSWLEC 212 North Sydney Municipal Council v Boyts Radio & Electrical Pty Ltd (1989) 67 LGRA 344 Parramatta City Council v Brickworks Ltd (1972) 128 CLR 1 Project Blue Sky Inc v Australian Broadcasting Authority (1988) 194 CLR 355 Star Property Investments Pty Limited v Leichhardt Municipal Council (2000) 111 LGERA 95 Stromness Pty Limited v Woollahra Municipal Council [2006] NSWLEC 587 Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 170 LGERA 345
DATES OF HEARING:	21 April 2010
DATE OF JUDGMENT:	7 May 2010
LEGAL REPRESENTATIVES:	BARRISTER Mr J A Ayling SC SOLICITOR Pikes Lawyers BARRISTER Mr J E Robson SC Mr A Stafford SOLICITOR Shaw Reynolds Bowen & Gerathy

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Pain J

7 May 2010

10004 of 2010 Iris Diversified Property Pty Ltd v Randwick City Council

JUDGMENT

: A preliminary question of law has arisen in these Class 1 proceedings as follows:

a. If it be determined that the land known as 379-401 Clovelly Road, Clovelly, being the whole of Lot 1 in DP 105854, has the benefit of existing use rights, in the context of the present development application for the change of such use to another use permissible in the zone, do the otherwise relevant provisions of the Randwick Local Environmental Plan including, but not limited to:
…

vi. clause 31 – landscaped area;
vii. clause 32 – maximum floor space ratios;
viii. clause 33 – building heights
…

derogate from the incorporated provisions and thus have no force or effect while incorporated per force of section 108(3) of the Environmental Planning and Assessment Act 1979?
and/or
b. Can the present development application be determined by the grant of development consent in the absence of an objection made under SEPP 1?

2 The answer to (b) of whether a SEPP 1 objection is required is determined by the answer to (a). The provisions of the Environmental Planning and Assessment Act 1979 (the EP&A Act) dealing with existing use rights are in issue.

3 Sections 108(1) - (3) of the EP&A Act provide:

(1) The regulations may make provision for or with respect to existing use and, in particular, for or with respect to:
(a) the carrying out of alterations or extensions to or the rebuilding of a building or work being used for an existing use, and
(b) the change of an existing use to another use, and
(c) the enlargement or expansion or intensification of an existing use.
(d) (Repealed)

(2) The provisions (in this section referred to as the incorporated provisions ) of any regulations in force for the purposes of subsection (1) are taken to be incorporated in every environmental planning instrument.

(3) An environmental planning instrument may, in accordance with this Act, contain provisions extending, expanding or supplementing the incorporated provisions, but any provisions (other than incorporated provisions) in such an instrument that, but for this subsection, would derogate or have the effect of derogating from the incorporated provisions have no force or effect while the incorporated provisions remain in force.

4 The incorporated provisions referred to in s 108(2) are found in the Environmental Planning and Assessment Regulation 2000 (the Regulation) Pt 5 “Existing uses”. As at 28 March 2006 (prior to the Environmental Planning and Assessment Amendment (Existing Uses) Regulation 2006) the Regulation provided:

41 Certain development allowed

(1) An existing use may, subject to this Division:
(a) be enlarged, expanded or intensified, or
(b) be altered or extended, or
(c) be rebuilt, or
(d) be changed to another use, including a use that would otherwise be prohibited under the Act.

(2) A use to which an existing use is changed is itself taken to be an existing use for the purposes of the Act and may, subject to this Division, be changed to another use.

5 The predecessor to cl 41(1)(d) in this form was cl 54(1) in Pt VI of the Regulation 1980 which stated that an existing use could be changed to another use. Clause 52 of the Regulation 1980 then provided:

(1) For the purposes of section 108(1)(a) of the Act, a building or work being used for an existing use may, with consent under the Act being obtained therefore and subject to subclause (2), be altered or extended.

(2) Any alteration or extension referred to in subclause (1) shall -

(a) be for the existing use of the building or work or for a use changed or consented to be changed in accordance with clause 54 but for no other use;
(b) be erected or carried out only on the allotment or allotments on which the building or work was erected or carried out immediately before the relevant date;
(c) not increase by more than 10 per cent the floor space of the building or work as it was at the relevant date.

6 Clause 41 as at 29 March 2006 (after the Environmental Planning and Assessment Amendment (Existing Uses) Regulation 2006 was introduced) provided:

41 Certain development allowed

(1) An existing use may, subject to this Division:
(a) be enlarged, expanded or intensified, or
(b) be altered or extended, or
(c) be rebuilt, or
(d) be changed to another use , but only if that other use is a use that may be carried out with or without development consent under the Act.

(2) (Repealed)

7 At the time of these amendments to cl 41 the Explanatory Note, published in Gazette No 39 of 29 March 2006, read:

The object of this regulation is to amend the Environmental Planning and Assessment Regulation 2000 :

(a) To enable an existing use, as defined by section 106 of the Environmental Planning and Assessment Act 1979 , to be changed only to a use that may be carried out with or without development consent under the Act and not also to a prohibited use, and
(b) To remove a provision that takes a use to which an existing use is changed to be itself an existing use for the purposes of the Act.

The amendments apply to an existing use regardless of whether the use was existing before the commencement of the amendments or not. However, they do not affect applications for development consent in respect of an existing use that have been made before that commencement.

The Regulation is made under the Environmental Planning and Assessment Act 1979 , including sections 108 and 157 (the general regulation-making power).

8 Since the Environmental Planning and Assessment Amendment (Existing Uses) Regulation 2007 of 9 February 2007 cl 41 provides:

41 Certain development allowed

(1) An existing use may, subject to this Division:
(a) be enlarged, expanded or intensified, or
(b) be altered or extended, or
(c) be rebuilt, or
(d) be changed to another use, but only if that other use is a use that may be carried out with or without development consent under the Act, or
(e) if it is a commercial use—be changed to another commercial use (including a commercial use that would otherwise be prohibited under the Act), or
(f) if it is a light industrial use—be changed to another light industrial use or a commercial use (including a light industrial use or commercial use that would otherwise be prohibited under the Act).

(2) However, an existing use must not be changed under subclause (1) (e) or (f) unless that change:
(a) involves only alterations or additions that are minor in nature, and
(b) does not involve an increase of more than 10% in the floor space of the premises associated with the existing use, and
(c) does not involve the rebuilding of the premises associated with the existing use, and
(d) does not involve a significant intensification of that existing use, and
(e) relates only to premises that have a floor space of less than 1,000 square metres.

(3) In this clause:
commercial use means the use of a building, work or land for the purpose of office premises, business premises or retail premises (as those terms are defined in the Standard Instrument (Local Environmental Plans) Order 2006).
light industrial use means the use of a building, work or land for the purpose of light industry (within the meaning of the Standard Instrument (Local Environmental Plans) Order 2006).

9 Clause 41(1)(d) has been in the same form since March 2006.

10 Clause 45 provides:

45 Development consent required for changes of existing uses

Development consent is required:
(a) for any change of an existing use to another use, and
(b) in the case of a building, work or land that is used for different existing uses, for any change in the proportions in which the various parts of the building, work or land are used for those purposes.


Development consent for the intensification or enlargement of an existing use is required under cl 42, for alterations or extensions of buildings under cl 43, and for rebuilding under cl 44.

Statement of Agreed Facts

11 The parties provided an agreed statement of facts which is relevant for the purposes of determining the preliminary question as follows,

1. The subject development site is known as 379-401 Clovelly Road, Clovelly and comprises the whole of the land in Certificate of title Folio 1/105854 described as Lot 1 in Deposited Plan 105854 at Clovelly, Local Government Area of Randwick, Parish of Alexandria, County of Cumberland.

2. The Title Diagram of DP 105854 was registered in 1930 and is a survey plan by Philip Sydney Nott, Licenced Surveyor dated 28 June 1926 (“the survey plan”).

3. The survey plan depicts “Hotel Clovelly” situated upon the land now described as Lot 1 in DP 105854 (“the Land”).

4. At least from 1926 to date:
a. The Clovelly Hotel has stood upon the Land; and
b. The Land has been used for hotel purposes.

5. The Randwick Local Environmental Plan 1998 (“the LEP”) came into effect on 10 June 1998 and remains in operation.

6. Under the LEP:
a. the Land is zoned “2C (Residential C Zone)”;
b. development for the purposes of a Hotel is prohibited in Zone 2C (Residential C Zone); and
c. the Clovelly Hotel is listed as a Heritage Item.

7. Council admits that the Land has the benefit of existing use rights as a hotel.

8. The development application the subject of this appeal seeks consent to: make alterations and additions to the Clovelly Hotel, including a new basement car park; a change of use pursuant to the incorporated provisions of the Environmental Planning and Assessment Regulation 2000 of part of the Land to permit the erection and use on that part of the Land of multi-unit housing being 6 apartments, and for the strata subdivision of the apartments and the hotel to create 7 strata lots. Within the LEP Zone 2C (Residential Zone) development for the purpose of the erection and use and subdivision of such apartments being development for the purposes of multi-unit housing, is permissible with development consent.

9. The development application for the erection of the multi-unit housing:
a. does not comply with clause 31 (landscaped area) and clause 32 (floor space ratios) of the LEP;
b. the Respondent contends but the Applicant denies that it does not comply with clause 33 (building and wall heights) of the LEP.

10. The Applicant has not sought dispensation from the LEP development standards by lodging an objection pursuant to State Environmental Planning Policy No. 1 – Development Standards.

12 Essentially the Applicant proposes a change of use to residential flats of part of the site which benefits as a whole from existing use rights for a hotel.

Applicant’s submissions

13 Controls within environmental planning instruments (EPI) such as development standards in the Randwick Local Environmental Plan 1998 (the LEP) which restrict or limit the consent authority’s capacity to approve a change of an existing use to a conforming use, derogate from the operation of the incorporated provisions, particularly cl 41(1)(d) and therefore have no force or effect. Several cases make clear that the application of s 108(3) to the incorporated provisions including cl 41(1) requires an approach to the meaning of derogation that where an existing use is changed from one use to another use, the development standards in a local environmental plan do not apply to the new use. Here the hotel has existing use rights over the whole of the land and it is proposed to build a residential flat building (changing the use) on part of the land. The issue then arises of whether a State Environmental Planning Policy No 1 – Development Standards (SEPP 1) objection is necessary to support the development application (question (b)).

14 In Kremer & Associates v North Sydney Municipal Council (1982) 47 LGRA 209 McClelland CJ held that for premises enjoying existing use rights s 108(3) had the effect of the incorporated provisions overriding the interim development order (IDO) in relation to the applicable floor space ratio (FSR). While this finding was obiter, given his finding that the FSR control was not breached, that approach was subsequently adopted. In Star Property Investments Pty Ltd v Leichhardt Municipal Council (2000) 111 LGERA 95 Talbot J held an existing use could be changed to another non-conforming use and also a conforming use. While this finding was also obiter because the relevant existing use was held to have been abandoned, that approach has been applied consistently. These decisions are consistent with the Court of Appeal in Carden v Willoughby Municipal Council (1985) 56 LGRA 366. Mahoney JA (Kirby P and McHugh JA agreeing) held that the relevant regional environmental plan (REP) (then cl 54 under the 1980 Regulation) derogated from the operation of the incorporated provisions because it restricted the council’s power to grant consent to the change of use. There was an analogous argument in Brown v Gosford City Council (2006) 143 LGERA 311.

15 There is no decided case on the effect of the incorporated provisions after the 2006 amendment to cl 41(1)(d) removing the capacity for a council to approve the change of an existing use to another non-conforming use. If the Council’s argument was correct then there would be no need to have cl 41(1)(d) in the Regulation at all as an application for development consent could be made under s 76A of the EP&A Act. That was one of the Minister’s arguments in Brown which was accepted at [30]. Clause 41(1)(d) must be read in light of s 108(3). The Council’s approach impermissibly reduces the operation of s 108(3). The wide meaning of derogate as held in Fabcot Pty Ltd v Hawkesbury City Council (1997) 93 LGERA 373 at 376 and Kirby P in Carden is applicable.

16 Permissible with consent in cl 41(1)(d) should be understood as meaning permissible in terms of the land use table in the EPI, as held by Powell JA (Meagher and Beazley JJA agreeing) in Hunt v Blacktown City Council (2001) 116 LGERA 356. Conforming uses do not include those uses permitted under the land use table subject to development standards.

17 The Applicant’s interpretation is in conformity with Kirby P in North Sydney Municipal Council v Boyts Radio and Electrical Pty Ltd (1989) 67 LGRA 344, as the interpretation allows for a cushioning effect from the application of planning laws to an existing use. No such cushion is provided by the Council’s construction of cl 41(1)(d). Further, there is nothing special about the factual circumstance here that a part of the site benefiting from existing use rights is the subject of an application for a change of use. Part 5 of the Regulation provides for development consent to be sought for the intensification or enlargement, alteration or extension or rebuilding of an existing use (cl 42 - 44). That development consent for a change of use is required under cl 45 does not suggest any special circumstance warranting a departure from the previous approach taken in several cases. There is no ambiguity in the statute warranting resolution in the manner considered in Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 170 LGERA 345. The cases relied on by the Applicant do not turn on their facts but determine relevant principles which are then applied to the particular facts of each case. While cl 41(1) has changed s 108(3) has not and the earlier cases relied on are directed to that section.

18 Question (a) should be answered in the affirmative, as should question (b).

Council’s submissions

19 Statutory construction must be undertaken mindful of the context and scope of the relevant instrument in accordance with Cranbrook School v Woollahra Municipal Council (2006) 66 NSWLR 379 at [63]. The incorporated provisions in the Regulation become part of the LEP by virtue of s 108(2) and must be considered in that light. The purpose of existing use rights was identified by Kirby P in Boyts at 345 as transitional provisions which cushion the impact of new planning laws. The change to a conforming use as now allowed is closer to the aims and objectives of the EP&A Act in relation to existing use rights.

20 Now the clause provides for another use “but only if that other use may be carried out with or without development consent” (emphasis added). By contrast with the former clause, these words are restrictive, narrow, and exclude prohibited development. So, far from derogating from cl 41(1)(d), now:

(a) there is no reason that requirements in an EPI intended to constrain or structure a consent authority’s discretion to grant development consent should be considered to “detract” from the operation or effect of cl 41(1)(d) and 45 (applying the meaning of “derogate” adopted in Fabcot at 378); and
(b) any requirement amounting to a prohibition in the LEP could mean that a development does not satisfy the plain words of cl 41(1)(d). Indeed, if development does not comply with a development standard (in the absence of a SEPP 1 objection) or if it is an unsatisfied jurisdictional fact, it is difficult to see how it could be “carried out with or without development consent” within the meaning of cl 41(1)(d).

21 That is, as a matter of ordinary construction, where development that fails to comply with requirements in the LEP so that development cannot be lawfully carried out with or without consent, the relevant LEP provisions do not derogate from cl 41(1)(d), but are requirements of it. Even where the requirement of the LEP is not a prohibition on consent being granted, other restrictions imposed by the LEP are ordinary constraints on the power to grant consent, which is in contemplation in cl 41(1)(d) when read with cl 45.

22 The provisions are clear on their face and have work to do. Consequently the cases relied by the Applicant which consider the earlier cl 41(1)(d) (par 4 above) are irrelevant, applying the High Court in Walker where it stated that historical considerations should be applied with caution. The incorporated provisions are part of the LEP and in order to be granted consent the changed use must come within the uses permitted under the LEP and under the controls in the LEP. Development standards are contained in cl 41(2) and (3) of the Regulation in relation to light industry and commercial uses. This supports the argument that the development standards in the LEP do not derogate from the change of use provisions in cl 41(1)(d). The Council is entitled to rely on these existing development standards as it is otherwise deprived of applying them. Clause 41(1)(d) does not derogate from the existing use provisions as it is considering the change of use provisions (see Applicant’s written submissions par 14).

23 In earlier times development standards were incorporated in Pt 6 of the Regulation as then in force (now Pt 5). Clauses 41(1)(e) and (f) now incorporate development standards in relation to change of use to a non-conforming use for commercial and industrial uses only. This fact also supports a view that development standards ought be applied to a conforming use as these would otherwise not be subject to any control in the same vein as those in cl 41(1) and 41(2).

24 The cases referred to by the Applicant are not determinative of the question before the Court as they considered a differently worded cl 41(1)(d) which allowed a change of use to another non-conforming use, not the facts of this matter and are therefore distinguishable on that basis. The former clause was permissive. In Carden the issue was whether the council had power to grant development consent, not whether a development standard applied to a change of use relying on existing use rights. Kremer is not strong authority as the findings relied on were obiter, similarly in relation to the findings in Star Properties relied on by the Applicant. In Fabcot a clause requiring consistency with zone objectives was held not to apply to a change to a prohibited use because that was only relevant in the case of permissible development, at 375-378. That reasoning no longer applies as cl 41(1)(d) now permits only change to a permissible use so that the LEP requirements which restrict the power to grant consent to permissible uses are now relevant to a change to a permissible use.

25 The liberal approach to the construction of existing use rights applied in Dorrestjin v South Australian Planning Commission (1984) 54 LGRA 99 at 105 per Mason ACJ, Deane and Dawson JJ and Council of the City of Parramatta v Brickworks Ltd (1972) 128 CLR 1 at 25 per Gibbs J no longer applies as cl 41(1)(d) abrogates rather than preserves existing use rights in relation to change of use. This restrictive view is supported by the Explanatory Note for the amended Regulation in 2006.

26 The LEP can supplement controls, in conformity with the wording of cl 108(3). The clause has work to do as it reflects law reform amendments which break with the previous longstanding provisions applying to existing use rights. Question (a) should be answered in the negative, as should question (b).

Finding

27 Division 10 Existing Uses EP&A Act provides the framework for the regulation of existing uses under that Act. Existing uses are defined in s 106. Section 107(1) specifies that an EPI cannot prevent the continuance of an existing use unless expressly stated in the EP&A Act. Section 108(1) (set out in par 3) provides for regulations to be made in relation to alterations, extensions, change to another use, enlargement and intensification of an existing use, inter alia. Section 108(2) provides that any such regulations made are incorporated into the relevant EPI. Subsection (3) provides that an EPI can expand or supplement the incorporated provision but cannot derogate from these. The changes to cl 41(1)(d) are set out above in par 4 and 5. Sections 108(2) and 108(3) have been in the same terms since 1979.

28 Clause 41(1)(d) in Pt 5 of the Regulation was amended to remove the ability to change an existing use to another non-conforming use in 2006. Subclause (2) was also removed. It had provided that if there was a change to another use the new use was also to be considered as an existing use. Subsequent amendments adding cl 41(1)(e), (f), and (2) in 2007 did not change subclause (1)(d).

29 The competing policy considerations which arise in relation to existing use rights were identified by Kirby P in Boyts at 345 where he stated:

A conflict between private and social rights:
Behind the competing legal arguments of the parties in this appeal lies a conflict between private and social rights. A wide definition of, and generous approach to, existing use rights tends towards the protection of private interests in land where these conflict with the social interests represented by the generally applicable planning law. A stringent approach to the proof of abandonment of an existing use right tends to favour private over social claims to the use of land. Identifying and defining existing use rights with specificity and precision tends to uphold the social interest represented by planning law and to confine derogations from that interest to a narrow class of case. The readier acceptance of abandonment of existing use rights conduces to the absorption of land, which exceptionally departs from the requirements of general planning law, into the code which otherwise generally applies. Seen in this way, existing use rights are a transitional derogation designed, for a time only, to cushion the impact of new general planning laws upon private owners with established use of their land which has continued without abandonment.


Both parties claim these observations concerning the role of existing use rights as transitional arrangements to alleviate the impact of changes in planning laws, made in the context of assessing whether an existing use had been abandoned in Boyts , supports their construction of cl 41(1)(d). While these observations are not determinative of the issue arising for consideration, the concept of existing use rights as transitional provisions is useful background in considering a purposive approach to the construction of cl 41(1)(d).

Construction of cl 41(1)(d)

30 The issue that arises for determination for the first time is whether cl 1(1)(d), as incorporated in the LEP by virtue of s 108(2), allowing a change to a use permissible with or without development consent, is derogated from if the change of use is assessed against the development standards in an LEP. The Council is arguing that there has been a fundamental change in the existing use rights regime in Pt 5 of the Regulation which is in keeping with an objective of managing existing use rights as transitional arrangements found in the EP&A Act. This requires that the Court consider the terms of cl 41(1)(d) as now in force and this approach does not require recourse to cases which considered the previous clause. The Applicant argues that section 108(2) is unchanged so the same meaning of derogate as has been applied by the Court in numerous cases should continue. Further, the approach identified in several cases to the effect that controls in EPIs do not apply to changes of use which rely on existing use rights should continue to apply in relation to cl 41(1)(d) as now in force so that it has a cushioning effect against changes in planning laws.

31 First and foremost I am considering a change in legislation, here a regulation (a statutory rule under the Interpretation Act 1987), so that the first consideration must be the terms of that legislation. Where a regulation is clear on its face and not ambiguous its terms must be applied where that approach promotes the purpose and object of the legislation. A construction which promotes the purpose or object underlying the statutory rule is required by s 33 of the Interpretation Act. That provision is consistent with the oft quoted observations of the High Court in Project Blue Sky Inc v Australian Broadcasting Authority (1988) 194 CLR 355 at 381:

The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined "by reference to the language of the instrument viewed as a whole". In Commissioner for Railways (NSW) v Agalianos, 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 than 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.

A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. 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. Reconciling conflicting provisions will often require the court "to determine which is the leading provision and which the subordinate provision, and which must give way to the other". 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.

Furthermore, a court construing a statutory provision must strive to give meaning to every word of the provision. In The Commonwealth v Baume Griffith CJ cited R v Berchet to support the proposition that it was "a known rule in the interpretation of Statutes that such a sense is to be made upon the whole as that no clause, sentence, or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent

32 The Council referred to the principles of statutory construction in relation to EPIs in Cranbrook as applicable because under s 108(2) the incorporated provisions become part of an EPI. McColl JA (Beazley and Basten JJA agreeing) stated at [36] and [63]:

36 Environmental planning instruments are a species of delegated legislation, a statutory instrument (s 3, Interpretation Act 1987) and should be interpreted in accordance with the general principles of statutory interpretation: Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389 at 398; see also Healesville Holdings Pty Ltd v Pittwater Council (1997) 97 LGERA 95 at 101 per Priestley JA (with whom Powell and Stein JJA agreed). A construction should be preferred that is consistent with the language and purpose of all the provisions of such instruments: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at 381, 384 [69], [78] per McHugh, Gummow, Kirby and Hayne JJ.
…

63 In the final analysis it is “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”: Commissioner for Railways (NSW) v Agalianos [1955] HCA 27; (1955) 92 CLR 390 at 397 per Dixon CJ.

33 McColl JA concludes that the same rules which apply to the construction of legislation also apply to EPIs. Clause 41(1)(d) (and Pt 5 of the Regulation) is silent on whether development standards in an EPI apply to the assessment of a conforming use which is a change of an existing use. It is therefore necessary to construe the Act and Regulation to determine what construction is consistent with the amended cl 41(1)(d) and the unamended s 108(1) and (3) of the EP&A Act in light of the circumstance that the incorporated provisions are part of an EPI which can extend or expand upon them.

34 The Council focuses on the construction of the clause as now drafted. Project Blue Sky is accepted authority that every word must count. Clause 41(1)(d) allows a change of use “but only if”. The words “but only if” are used together with more restrictive wording as the nature of the changed use must be conforming, meaning it may be carried out with or without development. I agree that this represents an important change in the existing use rights regime and suggests a significantly more restrictive approach to the change of an existing use compared to the previous circumstance where a change to a prohibited use was permissible.

35 Another change to cl 41 made at the same time in 2006 as the change to cl 41(1)(d) was the removal of cl 41(2) which had provided that a use to which an existing use is changed was also to be taken to be an existing use for the purposes of the EP&A Act. The removal of that provision also supports a conclusion that the amendments were intended to restrict the change of use allowed to an existing use to a substantial degree when compared with the provisions before the 2006 amendments. This view is reflected in the Explanatory Note to the amending Regulation set out in par 7 above. Such documents can be considered in the interpretation of statutory rules in accordance with s 34(1) and (2)(e) of the Interpretation Act.

36 This approach is also supported by comparison with the later addition in 2007 to cl 41 whereby a change to a non-conforming use is allowed for commercial and industrial premises under cl 41(1)(e) and (f) but is limited to the criteria in cl 41(2). These provisions impose limits on a change of an existing use to a prohibited use but if the Applicant is correct no similar limits such as appear in development standards would apply to a change to a conforming use.

37 These important changes to cl 41(1)(d) must be considered together with the fact that s 108(3) remains unamended. It states that no provision of an EPI can derogate from an incorporated provision, including cl 41(1)(d). Kirby P noted in obiter at 368 in Carden that s 108(3) was expressed in broad terms and held that derogation means “taking away from” or “detracting from” that which would otherwise exist. In Fabcot Lloyd J held at 378 that derogate means:

Section 108(3) uses the word "derogate" the ordinary meaning of which is "to repeal or abrogate in part; to destroy or impair the force or effect of; to lessen the extent of; to detract from; to disparage, to depreciate" (Shorter Oxford Dictionary). In the Macquarie Dictionary the word is defined in the sense of "to detract". The relevant provisions of the environmental planning instrument in this case, namely cl 9 and the objectives of the zone, would clearly derogate from the incorporated provisions. Accordingly, those provisions of the local environmental plan have no force or effect. However, it is only those provisions of the local environmental plan which would derogate or have the effect of derogating from the incorporated provisions which have no force or effect.

38 Fabcot was another case in which the Court had to consider whether a change of an existing use to another non-conforming use was permissible under s 108 and the 1994 Regulation then in force. These cases support a broad approach to the meaning of derogate in s 108(3), a fact emphasised by the Applicant’s counsel. However, for the reasons articulated in the Council’s submissions (summarised in par 20) it is not necessarily the case that development standards in an LEP which constrain a consent authority’s discretion to approve a conforming use detract from, lessen the extent of or impair or depreciate the change of use to the existing use permitted. It does not destroy any change of use permitted by cl 41(1)(d). As a matter of ordinary construction, in relation to development that fails to comply with requirements in the LEP so that development cannot be lawfully carried out with or without consent, those requirements do not derogate from cl 41(1)(d).

39 I agree with the Council’s submission that the expansive approach to the construction of existing use rights as found in cases such as Dorrestjin and Brickworks no longer automatically applies where the statutory provision concerning a change to an existing use is restrictive, as cl 41(1)(d) now is.

Are earlier cases relevant?

40 As there is no authority which has considered the amended cl 41(1)(d) in force since 2006 it is necessary to determine if the cases relied on by the Applicant are relevant. The Council referred to Walker as authority that cases must be treated with caution where legislation has changed. In Walker the full bench of the High Court at [31] stated that caution should be applied to adopting authorities from other jurisdictions in the context of land valuation quoting approvingly McHugh J in Marshall v Director-General, Department of Transport (2001) 114 LGERA 389 at [62]. High Court authority is not needed to support a statement that the application of cases considering legislation in different terms must be treated with caution.

41 The cases all consider the earlier version of cl 41(1)(d) or its predecessor cl 54, which allowed a change of an existing use to another non-conforming (prohibited) use. In Kremer, McClelland CJ held at 219 that the effect of s 108(3) on premises enjoying existing use rights was that the incorporated provisions overrode the provisions in the IDO in relation to floor space ratios. That finding was obiter because of the factual finding made that the floor space ratio was not breached. At that time Pt 6 of the 1980 Regulation dealt with existing use rights and contained a limit on the expansion of existing use rights of 10 per cent in cl 52(2)(c). That provision is now reflected in the current cl 41(2) in relation to commercial and industrial premises where changes to non-conforming uses are allowed within specified limits. In Star Properties the subclause was discussed in obiter to allow a change of use to another conforming use.

42 In Carden, Mahoney JA was considering whether the appellant could rely on its existing use rights to convert residential flats to strata office suites (a commercial use), a non-conforming use under the relevant LEP land use table for the particular zone. At issue was whether cl 34 of the Sydney Regional Plan No 5 (the REP), which required that a car parking station be provided as a condition of consent, derogated from the incorporated provisions in the Act. That clause was not a development standard but a prerequisite which had to be satisfied if development consent was to be granted. His Honour held the section did derogate from the incorporated provisions and could not apply as required by s 108(3). Accordingly, the council could consider the application for a change of use despite cl 34. The council was empowered to grant development consent under another clause of the REP and cl 34 restricted the council’s power or duty to give consent under that clause. The clause was therefore prohibited from operation by s 108(3) because it derogated from the incorporated provisions.

43 The distinction asserted by the Council’s submissions in relation to Carden, namely that it concerned the question of the Council’s power to consider a development application based on a change of an existing use to a prohibited use is relevant as it underlines the important difference in cl 41(1)(d) as currently in force from that considered in Carden. A change of an existing use can now only be made to a use which is otherwise able to be carried out with or without consent under the relevant EPI. The same question of whether the Council’s power to approve a change of use was derogated from by the operation of a clause in an LEP, and therefore impermissible under s 108(3), does not arise in relation to cl 41(1)(d) as now drafted. Carden does not apply directly to the issue raised by question (a) concerning the application of development standards to a conforming use. To the extent that an issue arises in the future as to the meaning of the phrase in cl 41(1)(d) ‘a use that may be carried out with or without development consent’ Carden may have some application. I make further observations on this matter in par 48 below.

44 While the propositions in Kremer and Star Properties relied on by the Applicant are obiter, the findings have informed the established approach of the Court when undertaking merit assessments of applications for a change of use relying on existing use rights to a non-conforming use. Essentially this has meant that development standards in an LEP were not applied to new uses sought by the holder of existing use rights as provided in cl 41 (or its predecessors). It is reflected in numerous Class 1 proceedings where the Court has assessed whether development consent ought be granted to a change of use which relies on existing use provisions.

45 One example is Fodor Investments Pty Ltd v Hornsby Shire Council (2005) 141 LGERA 14, which I referred to in Masterbuilt Pty Limited v Hornsby Shire Council [2005] NSWLEC 212. In Fodor, the then Senior Commissioner determined that while the development standards in the relevant LEP could not be applied to the change in use, general town planning principles should be under the considerations referred to in s 79C of the EP&A Act. I applied that approach in Masterbuilt also. I referred to Berowra RSL Community & Bowling Club Limited v Hornsby Shire Council (2000) 114 LGERA 345 as authority that no provisions in any EPI which derogate from the existing use can have any force or effect. Masterbuilt was a merits assessment conducted in Class 1 proceedings and did not cause me to consider the issue that arises in the question of law before me.

46 In Brown I was considering as a question of law whether cl 41(1)(d) as then in force (set out at par 4) was ultra vires because it permitted the granting of development consent to prohibited development. My finding at [28] was focussed on whether the EP&A Act and Regulation allowed the change of an existing use to another non-conforming use and I held that it did. That was the context in which I considered Star Properties and Kremer and applied them. That is also the context in which I accepted the Minister’s argument (at [25]) that to hold otherwise would mean that cl 41(1)(d) had no work to do. That argument is relied upon by this Applicant as supportive of its construction of the EP&A Act and Regulation. Brown however is not addressing the particular issue that arises in the question of law before me and does not provide any relevant precedent. In particular Brown did not consider whether other parts of the relevant EPI could apply to the assessment of the change of use application.

47 In taking the necessarily fundamental look at the operation of s 108(2) and (3) in relation to cl 41(1)(d) as it is now drafted, it is interesting to discover that there is no direct authority supporting the Applicant’s approach. Kremer is the most explicit statement in support and while persuasive is not binding on me given it is a decision of a single judge and dealt with facts different to those before me. None of the cases is binding precedent. I do not consider I should apply the approach reflected in the authorities as cl 41(1)(d) is now sufficiently different to demand fresh consideration in terms of statutory construction.

48 The Applicant submitted that Hunt was authority that the only part of the LEP which could apply in light of cl 41(1)(d) to determine whether a use could be carried out with or without development consent was the land use table. Other provisions in the LEP such as development standards if applied would derogate impermissibly. At issue in Hunt was whether a site had the benefit of existing use rights which enabled it to change a use to another prohibited use. Powell JA at [43] (Meagher and Beazley JJA agreeing) held that prohibited development was that identified as such in the relevant part of the land use table. Hunt was directed to the issue of whether a council had power to consider a change of use, as the Council submitted. Hunt is authority that the application of the relevant land use table in an LEP is a guide to whether a use is conforming or not for the purposes of cl 41(1)(d) but that does not answer whether the assessment of the application for the change of use in accordance with the development standards of the LEP derogates from that subclause.

49 One point of clarification of my findings is necessary and it is useful to raise this now having referred to Hunt in the previous paragraph. The Council submitted (par 20(a) and par 21 above) that any requirement in the LEP which could be a prohibition of a use would not satisfy cl 41(1)(d) as being a use that may be carried out with or without consent. This appeared to include a failure to comply with a development standard in the absence of a SEPP1 objection. I do not consider that statement accords with authorities such as Hunt which suggest that whether a use is conforming or not is determined by reference to the land use table in an EPI. The resolution of question (a) does not require such a conclusion. I consider that the Council’s submission to that effect is incorrect and would result in too restricted an approach to what is meant by a use that may be carried out with or without development consent in cl 41(1)(d).

50 Adopting the meaning of derogate applied in Carden and Fabcot and applying an ordinary meaning to the words in cl 41(1)(d), I do not consider that the application of development standards in the LEP to the assessment of a conforming use as defined under the land use table is a derogation to which s 108(3) refers. Such an approach will not detract from, destroy or impair the operation of cl 41(1)(d). Section 108(3) contemplates that other provisions of the LEP will expand on the incorporated provisions. The assessment of the otherwise conforming use in accordance with the relevant development standards in the LEP does not derogate from the incorporated provision which is cl 41(1)(d).

51 A criticism made by the Applicant of the Council’s approach is that it leaves no work for cl 41(1)(d) to do. An application could simply be made under s 76B of the EP&A Act and determined in the usual way. Clause 41(1) identifies all the changes which are permissible for an existing use under the Regulation and for clarity alone a clear statement in one section of the permitted changes is necessary and desirable. Clause 41(1)(d) as amended, together with the repeal of cl 41(2) in 2006, is a material and significant change to the previously existing situation which applied to the change of an existing use. As submitted by the Council the clause has work to do.

Conclusion

52 The answer to question (a) is that the specified provisions in the LEP do not derogate from the incorporated provision cl 41(1)(d) and do have force and effect.

53 The practical effect is that referred to in question (b), namely that a SEPP1 objection is necessary to the extent that the Applicant seeks to vary the application of a given development standard. The answer to question (b) is that the present DA cannot be determined in the absence of an objection under SEPP 1.

10/05/2010 - typographical error second "not" deleted - so reads "do have force and effect" - Paragraph(s) 52