Karen Glover v Minister for Planning and Alice Harris
[2003] ACTSC 42
KAREN GLOVER v MINISTER FOR PLANNING and ALICE HARRIS
[2003] ACTSC 42 (3 JUNE 2003)
LAND (PLANNING AND ENVIRONMENT) ACT 1991 – Administrative Appeals Tribunal – Approval for second dwelling unit – effect of Draft Variation to the Territory Plan – effect of Crown Lease – validity and commencement of Draft Variation – power to approve development application.
Land (Planning and Environment) Act 1991 (ACT), ss 8, 9, 9(2)(a), 9(3), 9(5), 11, 19(1)(a), 19(1)(d), 19(5), 22, 27, 230
ACT (Self-Government) Act 1988 (Cth), s 23
Conveyancing Act 1919 (NSW), s 133B
Spence, Cecilia v Minister for Urban Services [2000] ACT AAT 37 (24 October 2000)
In re Greater London Properties Ltd’s Lease [1959] 1 WLR 503; 1 A11ER 728
Hyman v Rose [1912] AC 623
Perry v Davis (1858) 3 CBNS 769; (1859) 140 ER 945
Doe v Jackson (1817) 2 Stark 293
ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL
No. SCA 54 of 2002
Judge: Higgins CJ
Supreme Court of the ACT
Date: 3 June 2003
IN THE SUPREME COURT OF THE )
) No. SCA 54 of 2002
AUSTRALIAN CAPITAL TERRITORY )
ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL
BETWEEN:KAREN GLOVER
Appellant
AND:MINISTER FOR PLANNING
First Respondent
AND:ALICE HARRIS
Second Respondent
ORDER
Judge: Higgins CJ
Date: 3 June 2003
Place: Canberra
THE COURT ORDERS THAT:
The appeal be dismissed.
The parties may be heard as to costs.
This is an appeal from a decision, made on 30 July 2002, by the ACT Administrative Appeals Tribunal (AAT), constituted by the President Mr M H Peedom, affirming a decision of the first respondent (the Minister) not to approve the erection of a second dwelling unit on Block 41 Section 29 O’Malley, on the ground that it was prohibited by the terms of the Crown Lease (the Lease) in respect of that block of land.
At issue is the construction of cl 1 and cl 3 of the Lease. Clause 1 provides (relevantly):
“THE Lessee covenants with the Commonwealth as follows:-
… … … ….
(b)That the Lessee will within twelve months from the date of the commencement of the lease or within such further time as may be approved in writing by the Territory for that purpose commence to erect one private single dwelling house building (with necessary and usual outbuildings and fences) on the said land at a cost not less than the sum of ten thousand dollars and in accordance with plans and specifications prepared by the Lessee and previously submitted to and approved in writing by the Territory;
(c)That the Lessee will within twenty four months from the date of the commencement of the lease or within such further time as may be approved in writing by the Territory complete the erection of the said building in accordance with the said plans and specifications and in accordance with every Statute Ordinance or Regulation applicable thereto;
… … …
(f)That the Lessee will not without the previous approval in writing of the Territory erect any building on the said land or make any structural alterations in any buildings erected on the said land;
(g)To use the said land for residential purposes only;
(h)That the building erected on the said land will be used only as a single unit private dwelling house and any outbuildings erected on the said land shall not be used as a habitation.
Clause 3(a) is also relevant:
“IT IS MUTUALLY COVENANTED AND AGREED as follows:-
(a)That if –
(i)a building in accordance with sub-clause (b) of clause 1 of this lease is not commenced within the period specified in the said sub-clause; or
(ii)a building in accordance with sub-clause (b) of clause 1 of this lease is not completed within the period specified in subclause (c) of the said clause; or
(iii)services in accordance with sub-clause (d) of clause 1 of this lease are not completed within the period specified in the said sub-clause; or
(iv)after completion of a building as aforesaid the said land is at any time not used for a period of one year for the purpose for which this lease is granted
the Territory may determine this lease but without prejudice to any claim which the Territory or the Commonwealth may have against the Lessee in respect of any breach of the covenants on the part of the Lessee to be observed or performed;”
As yet no dwelling has been erected.
The learned President considered the effect of the above provisions to be inconsistent with the erection on the land of more than one dwelling unit. Hence the appellant’s development application was precluded as being inconsistent with the terms of the Lease. That did not determine the matter. The appellant could have sought a variation of the Lease to permit a second dwelling unit. That was not sought however. The second dwelling unit was, therefore, part of the application for development approval submitted by the appellant.
An issue was also raised as to whether, even if the Lease did permit multi-unit housing, the proposed development would be excluded by the provisions of cl 3.1 of a Draft Variation to the Territory Plan no. 200 (DV200), notified on 30 May 2002.
That Draft Variation, if validly notified (and the appellant had disputed this) provided, relevantly for present purposes –
“Where a residential lease is expressed to require the erection of a single dwelling, a development approval which has the effect of allowing multi-unit housing on the land shall not be granted unless a period of 5 years has elapsed since the original dwelling was certified as completed in accordance with the requirements of the Territory.”
That question did not need to be resolved by the AAT in the light of its finding that the terms of the Lease precluded the proposed development. The appellant contends that DV200 ought to have been regarded as inapplicable in any event. So to find would have then required the AAT to have considered the refusal of the proposal on its merits. The Minister (through his delegate), had in any event, determined that the proposal should be rejected for non-compliance with the relevant standards, even if not precluded by the Lease or DV200, albeit that the matters of non-compliance so identified were capable of being remedied by amendment of the proposal. No doubt, but for those issues, that possibility would have been further explored.
SUBMISSIONS OF COUNSEL
It is the appellant’s submission that the Lease requires one dwelling unit to be constructed on the subject land but does not forbid the construction of more than one such dwelling unit. That conclusion, it is further submitted, is supported by the learned President’s own prior decision in Spence, Cecilia v Minister for Urban Services [2000] ACT AAT 37 (24 October 2000).
The policy objective of preventing or limiting multi-unit developments on such blocks of land, the appellant contends, is the province of the Territory Plan and of the processes mandated by the Land (Planning and Environment) Act 1991 (ACT) (the Land Act). It is not to be read into the terms of the Lease. The Lessee contends that refusal of her application is therefore discretionary, not mandatory – (see Control 2.10 Territory Plan – use of term “may not” approve). Thus she submits that she is entitled to have the application considered on its merits.
The terms of DV200 would, for five years following the fulfilment by the appellant (or her successor in title as Crown Lessee) of her obligations under cl 1(b) and (c) of the Lease, forbid approval for multi-unit development on the land.
The appellant submits that the Draft Variation has no effect because, in terms, the period prescribed for it to take effect (pursuant to s 9(5) of the Land Act) has not commenced, and is so confusingly stated as to be unascertainable. Further, it is submitted, there is no evidence of the notification required by s 19(1)(a) of the Land Act nor of publication as required by s 19(5) of that Act.
The appellant further contends that she has a vested right to have her development application, made in December 1991, considered according to the then Territory Plan which did not, in terms, forbid such a development.
Thus, insofar as DV200 now appears to have a contrary effect, it is submitted that it should be construed to apply only to applications lodged after May 2002, when it purportedly took effect.
In any event, it is contended that such a purported retrospective effect would involve a partial acquisition, otherwise than on just terms, of the appellant’s rights under the Lease, in that it has the effect of conferring a benefit on adjacent lessees. This, it is contended, would contravene s 23 of the ACT (Self-Government) Act 1988 (and s 51(xxxi) of the Constitution).
Mr Kennett, for the Minister, contended that on its true construction, the Lease did prohibit more than one dwelling unit being constructed upon the land, as the learned President had found.
In any event, it was submitted the proposed development was precluded because it was contrary to the Territory Plan (see s 8 of the Land Act).
In addition, Mr Kennett contended that the situation was, in any event, overtaken by DV200.
Section 9 of the Land Act refers to the effect of a draft plan variation.
“9 Effect of draft plan variation
(1)This section applies to a draft plan variation if a consultation notice states that it applies.
(2)The Territory, the Executive, a Minister or a Territory authority must not, during the defined period or a period stated in the consultation notice, whichever is shorter, do or approve the doing of anything that—
(a) would be inconsistent with the plan if it were varied in accordance with the draft variation; or
(b) is inconsistent with the plan.
(3)Subsection (2) is subject to section 11 (Draft heritage places register and variations—lack of effect).
(4)Where a draft plan variation to which this section applies is deferred under section 22 (1) (b) or 27 (a), this section does not apply in relation to that draft variation during the period of its deferral.
(5)In this section:
defined period means the period beginning on the day when the draft plan variation is notified under the Legislation Act 2001 (see section 19 (Public consultation—notification)) and ending at the end of the day before—
(a) the date the draft variation comes into effect; or
(b) the date the corresponding plan variation is rejected by the Legislative Assembly; or
(d) the date the draft variation, or the corresponding plan variation, is withdrawn under section 22 (1) (c), 27 (a) or 29 (10) (b);
as the case requires.
DV200 was notified, for the purposes of s 9(2)(a) on 30 May 2002. It would, during the “defined period”, prohibit approval of an application to carry out an inconsistent development. (Section 11, referred to in s 9(3) above, relates only to heritage protection). Thus, it is submitted, as at 30 July 2002, the date of the AAT decision, DV200 was in force. That is notwithstanding that the original decision was deemed to have been made, refusing the application (pursuant to s 230), on 25 March 2002.
The Minister contended that, as the Lease “required” the building of one dwelling unit, DV200 was applicable. It took effect when it was made and notified, and bound the AAT not to make a decision contrary to its terms.
Further, the Minister contended, that whilst the lease required one dwelling unit, no other was permitted save with the consent of the Lessor. The Land Act permits a variation of the Lease to erect more than one dwelling unit, but confers no right to such a variation. If the Lease does not itself preclude the building of a second (or more) dwelling unit, then DV200 would, after five years, permit such an additional unit if it was otherwise consistent with the Territory Plan to approve such a development and if it was so approved. It was submitted for the Minister that there was no prior vested right to erect a second (or further) dwelling that was or would be restricted by DV200. DV200 conferred only the limited right to seek approval of a development which would have that effect. Otherwise, there would have been only the right, if it be such, to ask the Lessor to approve a variation of the Lease to permit a second or further dwelling unit. There was no vested right to have such an approval given. Thus there could be no acquisition or even diminution of any prior vested right.
CONSTRUCTION OF THE LEASE
The issue as to whether the Lease forbids the erection of a second dwelling unit was, as counsel for the appellant submitted, addressed in the matter of Spence, Cecilia v Minister for Urban Services (supra).
In that matter, the applicant had applied to erect a second dwelling unit on land at Turner. The Crown lease was similar in terms to the Lease in this case. There had been a variation of the Crown lease approved which, in terms, permitted that course. The issue was not whether the lessee had permission to erect two dwelling units, but rather whether the variation of the lease expressly to permit those two dwelling units had altered the value of the lease, by conferring on the lessee a new and more valuable right. The applicant’s case was put on the basis that it had not been necessary to have altered the Crown lease in question, so as to permit the erection of a second dwelling unit, and thus there was no such added value. She contended that the erection of a second dwelling unit was not forbidden by the Crown lease though, of course, the lessor could refuse consent to it.
The learned President noted that, at the date when the lease was granted, there was a dwelling already erected on the land. The only reference to the dwelling and further buildings which might be added were the usual terms in cl 1 of the Crown lease, namely, that all buildings would be kept in good condition (cl 1(b)), that no other building and no structural alteration could be erected or made without the lessor’s approval (through the relevant Minister) (cl 1(c)), that the land be used for residential purposes only (cl 1(d)) and that “the building erected on the land be used only as a single unit private dwelling house” (cl 1(e)).
The learned President noted, correctly in my respectful opinion, that cl 1(d) did not forbid the erection of a second dwelling on the land. Further, to have done so would not alter or be inconsistent with the restriction on the use of the land. That use would still be “residential”.
What then of cl 1(e)? Clearly, and, again, I respectfully agree, “the building” there referred to was the dwelling already erected. If there was more than one such “building” erected, each would be for use only as a single dwelling unit.
The learned President then concluded:
“13.Were the interpretation advanced by the applicant to lead to a capricious, unreasonable, inconvenient or unjust result there may be a basis upon which to reject the applicant’s interpretation. No such outcome has, however, been identified by interpreting the Crown lease in the manner contended by the applicant. The prevention of the division of single dwellings into multiple dwellings is a readily enough understood planning objective in addition to any objective that might be fulfilled by the interpretation relied upon by the respondent, such as the prevention of dual occupancy development.”
Thus it followed that:
“15…subclause 1(e) of the Crown lease did not, before the variation was approved, by itself, prevent the construction of more than one dwelling house on the land, it follows that the variation of the lease to specifically permit that to be done did not increase the value of the land.”
It should be noted that neither the possibility of approval of a second dwelling unit nor the express permission to do so entailed the approval of any particular development proposal.
The lease in question in Spence differed from the present in that it did not require the building of any dwelling unit on the land. That was because there was already a dwelling erected on the land. The application thus would not have attracted the restriction imposed by DV200.
Nevertheless, subject to the operation of DV200, the same conclusion would follow in respect of the Lease. That is, that it does not forbid the erection of a second dwelling unit on the land. However it does not require it, and permission to erect such a second unit might be denied by the Minister. The Minister could only grant such permission if it be not inconsistent with the Territory Plan to do so. Furthermore, any development, whether of one or more dwelling units, even if not inconsistent with the Territory Plan, requires approval under the Land Act.
In my view, the approach of the learned President in Spence was correct. The view he took in this case, that a requirement to erect a dwelling unit implicitly forbad the erection of a second unit is, therefore, not correct. Nor is there any planning or other reason to import such a negative covenant. Nevertheless, the erection of such a further dwelling unit cannot occur without both the Lessor’s approval and approval under the Land Act, provided further that such a development is not inconsistent with the Territory Plan, including any valid and binding Draft Variation.
IS DV200 VALID?
Whether or not dual occupancy on a particular block of land should occur is a matter which the Territory Plan may properly address. Whether by surrender and regrant of leases or otherwise, some dual occupancies have been permitted.
Many discretionary factors would be relevant before such an approval could be expected. The expectations of those who have purchased a lease in the same neighbourhood is, for example, a relevant matter.
The terms of DV200 would, in the case of a lease such as the present, permit a second dwelling unit (subject to approval of the development), only after 5 years has expired since the first dwelling unit was constructed.
The submission of the appellant proceeded upon what seems to me to be a basic misapprehension. The effect of the Draft Variation is immediate, once it is notified in accord with s 19 of the Land Act (as this DV purports to be). It may be deprived of effect by subsequent events which may arise from the application of s 19 (and following) of the Land Act. The provisions of s 19(1)(d) of the Land Act, for example, regulate submission of the DV to the Territory Executive. Nevertheless, the DV has interim effect until adopted, varied or rejected.
Contrary to the suggestion that the Notice in respect of DV200 does not purport to be a Notice of a Draft Plan Variation, it seems to me that the Notice faithfully follows the requirements of s 9 of the Land Act. Nor is it to the point that s 19(5) of the Land Act has or has not been complied with. It requires publication of either “the consultation notice” or “the extension notice”. The former is a precondition to submission of the DV to the Executive for approval or otherwise. The latter relates to an extension (if needed) of the “consultation period”. Neither relevantly prevents the immediate (interim) effect of the DV. Nor does the possibility of its revision under s 22 or 27 of the Land Act affect its current force.
It follows that there is no reason to suppose that DV200 was not, at the time, a relevant restraint on the approving authority, (at the relevant time including the AAT), under the Land Act in determining whether or not to approve the proposed development application. The question remaining is whether DV200 effectively required the refusal of the appellant’s application.
EFFECTIVENESS TO ABROGATE RIGHTS
The appellant’s submissions are twofold. The first is interpretive. The second is constitutional.
As to interpretation, DV200 unarguably, for so long as it has effect in terms, prevents approval of a second dwelling for five years after the first is constructed and completed. There is no substance in any suggestion that it is unclear or open to any other interpretation.
As to the constitutional argument, there was no right conferred under the Lease to construct a second dwelling. It is true that, if no development controls were lawfully in place, it would be open to a Lessee to construct whatever buildings he or she might choose on the land, subject to the Lessor’s approval being first had and obtained.
However, as is the case even with freehold land, no substantial construction or renovation of any building can be carried out without approval of a proper authority. There is no right to do so granted under the Lease. A Lessee has a duty pursuant to the applicable building covenant to erect a single dwelling unit, as approved by the Lessor. He or she (or it) has no right to engage in further construction, save in so far as such rights might be conferred by the Land Act, pursuant to approvals granted thereunder.
It follows that to enact a law which, in effect, allows a second or further dwelling unit if and only if certain controls and conditions are met, does not deprive the Lessee of any vested right. As already noted, the Lease permits such a development only if the lessor consents. There is no provision that the development may occur if the lessor unreasonably refuses consent (cf s 133B Conveyancing Act 1919 (NSW) – see In re Greater London Properties Ltd’s Lease [1959] 1 WLR 503; 1 A11ER 728; Hyman v Rose [1912] AC 623; Perry v Davis (1858) 3 CBNS 769; (1859) 140 ER 945; Doe v Jackson (1817) 2 Stark 293).
Thus neither the principle of interpretation nor the statutory or constitutional guarantee in respect of vested rights is applicable to affect adversely the operation or validity of DV200.
WHAT IS THE EFFECT OF DV200?
The DV reads as follows:
“Draft Variation 200
Multi Unit Housing (Including Dual and Triple Occupancy Housing)
Where a residential lease is expressed to require the erection of a single dwelling, a development approval which has the effect of allowing multi-unit housing on the land shall not be granted unless a period of 5 years has elapsed since the original dwelling was certified as completed in accordance with the requirements of the Territory.”
“Multi-unit housing” is defined under DV200 to mean, inter alia, residential land used for more than one dwelling.
The Lease itself is “expressed to require the erection of a single dwelling”. Thus DV200 applies to it. DV200 imposes a restriction of five years for a development approval that could authorise multi-unit housing. That prohibition is mandatory. It will cease to apply only after five years from completion of “the original dwelling”.
In my view, “the original dwelling” is that dwelling unit required by the Lease to be erected. That fact that no dwelling unit has yet been erected merely implies that the period of five years has yet to commence. As I have noted above, there is no uncertainty about the application of DV200 or its effect.
CONCLUSION
It follows therefore, that the Lease itself does not forbid the erection of a second dwelling unit. No Lease variation is required to permit it. The Lease, however, attracts the terms of DV200 so that the Minister is not empowered, so long as that DV is in force, to approve a development application seeking the erection of more than one dwelling unit on the land.
Thus, albeit for different reasons than adopted by the learned President, I agree that the development application was rightly rejected. The respondent has no discretion to grant it.
I will hear the parties as to costs.
I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Chief Justice Higgins.
Associate:
Date: 3 June 2003
Counsel for the appellant: Dr R O’Hair
Solicitor for the appellant: Canberra Lawyers
Counsel for the respondent: Mr G R Kennett
Solicitor for the respondent: ACT Government Solicitor
Date of hearing: 9 December 2002
Date of judgment: 3 June 2003
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