Kayora Pty Ltd v Leichhardt Council

Kayora Pty Ltd (the appellant) sought to use the rear yard of its hotel premises as a beer garden. Leichhardt Council (the respondent) contended that this use was not permitted under the existing use rights for the hotel. The matter came before the Supreme Court of New South Wales, Court of Appeal.

The central legal issue before the Court of Appeal was whether the existing use rights for the hotel premises extended to the use of the rear yard as a beer garden. This required the Court to consider the characterisation of the use of the rear yard and whether it was ancillary to and part of the hotel's existing use.

The Court of Appeal reasoned that the consent granted for the continuance of the existing use as hotel premises encompassed all activities that were reasonably incidental to and ancillary to the operation of a hotel. The Court found that the use of the rear yard as a beer garden was such an activity, particularly given the historical use of the area as depicted on a plan dated 2 September 1953. The Court applied the principle that existing use rights should be interpreted broadly to reflect the reality of how such premises are operated.

The Court of Appeal allowed the appeal, set aside the previous orders, and declared that the appellant was entitled to use the area as an outdoor beer garden for the purposes of a licensed hotel, subject to the condition that no building be erected without development consent. The respondent was ordered to pay the appellant's costs.