Kettering v Noosa Shire Council

[2000] QPEC 71

PLANNING AND ENVIRONMENT COURT OF QUEENSLAND

CITATION:	Kettering Pty Ltd v. Noosa Shire Council [2000] QPE 071
PARTIES:	KETTERING PTY LTD  Appellant And NOOSA SHIRE COUNCIL                     Respondent
FILE NO/S:	Appeal No 176 of 1995
DIVISION:	Planning and Environment
PROCEEDING:
ORIGINATING COURT:	Brisbane
DELIVERED ON:	1 December 2000
DELIVERED AT:	Brisbane
HEARING DATE:	23 October 2000
JUDGE:	Senior Judge Skoien
ORDER:
CATCHWORDS:	Local Government (Planning and Environment) Act 1990; Sparke v. Noosa Shire Council; Integrated Planning Act 1997; Noosa Hill Development Control Plan;
COUNSEL:	Mr Gore QC, with Mr Rackemann for the appellant Mr Doyle SC, with Mr. T. Trotter for the respondent
SOLICITORS:	Deacons, Lawyers, for the appellant Wakefield Sykes for the respondent

1. The application before me is to try as a separate and preliminary point whether the provisions of section 3.5(4) and s.3.5(5) of the Local Government (Planning and Environment) Act 1990 preclude a claim for compensation for injurious affection to land which Kettering has made against the Council.

1. Kettering owns 19.8 ha of land in the Noosa Shire which adjoins the Noosa National Park and the Hastings Street precinct.  It has made a claim for compensation arising out of what it contends is the adverse impact on its interest in the land by the introduction on 21 September 1991 of the Noosa Hill Development Control Plan (“DCP”).

1. The land was (and is) zoned "Rural Pursuits" in which the use of land, for the purpose of a dwelling house is a permitted use.  Subject to a power of relaxation, land in the Rural Pursuits zone could not be sub-divided below 40 hectares.  The land is also now controlled by the 1998 Strategic Plan pursuant to which the designations "Urban" and "Tourist Facility Growth Area" affected it. 

1. It was the introduction of the DCP which gave rise to the claim for compensation which is based on the proposition that prior to the DCP the land could reasonably have been expected to be rezoned to permit development for 73 house lots and 132 building units or group title units.  Now most of the land falls within sub-precinct D of precinct 2 created by the DCP in which, effectively, the DCP prohibits development for any type of residential use.  Each of the other three sub-precincts which affect the land contemplate residential use, but of a limited or restricted density.  So according to Kettering the DCP restricts the yield of the land to 24 house lots and 75 building units or group title units. 

1. This appeal has been in abeyance for some years for reasons which included the hearing by the Court of Appeal of Sparke v. Noosa Shire Council.  The decision in that case was handed down on 27 August 1999 and is reported in (1999) 107 LGERA 1. That case decided that in a case in which s.3.5(4)(d) applies, an application for compensation in respect of land which potentially could be re-zoned to a more intensive use could not rely on the provisions of s.3.5(5) of the P&E Act which is:

“(5)  For the purposes of subsection (4)(d), it is not to be taken that an applicant did not have the legal right referred to in that subsection by reason only that the applicant’s right depended upon an exercise of discretion by the local government in the applicant’s favour if the applicant shows that it is reasonable to expect that the exercise of discretion would have been in that applicant’s favour had it been sought immediately before the relevant provision of the planning scheme came into force.”

The decision turned on the point that the discretion of the Governor in Council, as well as that of the local government, was needed in order to obtain a re-zoning.

1. As required by orders made by His Honour Judge Quirk on 4 August and 31 August 2000, Kettering has identified the two ways in which it contends its claim for compensation can be advanced.  His Honour ordered to be tried as a separate and preliminary question the correctness of the second of these contentions.  Stated shortly, it raises the effect of the DCP in relation to a possible rezoning of the land to another zone in which land could have been developed to enable more intensive residential development, such as is described in paras [3] and [4] above.

1. Although the Planning and Environment Act has been replaced by the Integrated Planning Act 1997, because of the provisions of s.6.1.27 and s.6.1.60 of the Integrated Planning Act this matter must be dealt with under the provisions of the Planning and Environment Act.  The task is essentially one involving the proper construction of s.3.5.(4)(d) of the Planning and Environment Act and the question whether Sparke applies to the present case.  Section 3.5(4)(d) is:-

“3.5 ….

(4)Compensation is not payable:

…..

(d)subject to subsection (2) where an interest in premises is affected by a planning scheme which by its operation prohibits or restricts the use of land or the erection or use of a building or other structure thereon for a particular purpose, unless the applicant establishes that the applicant had a legal right immediately before the provision in question of the planning scheme came into force to use the land or erect or use a building or other structure thereon for the particular purpose which is so prohibited or restricted;"

It was not suggested by either party that subsection (2) has any relevance to the present question.

1. It is helpful to strip s.3.5(4)(d) to its relevant essentials and to do that, I note that s.1.4 of the Planning and Environment Act defines “premises” to include land;  that this case has proceeded on the assumption that the DCP prohibits or restricts the rights of Kettering to create a residential development of the intensity that was likely before the introduction in 1991 of the DCP;  that the case does not concern the erection or use of a building or other structure.  The DCP is, of course, part of a planning scheme (Planning and Environment Act, s.2.1(d)).  So s.3.5(4)(d) can be paraphrased thus:

“Compensation is not payable where Kettering’s interest in the land is affected by a DCP which by its operation prohibits or restricts the use of the land for a particular purpose, unless Kettering establishes that it had a legal right, immediately before the DCP came into force on 21 September 1991 to use the land for the particular purpose which is prohibited or restricted.”

1. Mr Gore QC, for Kettering, argued that the case before me is completely covered by the decision of the Court of Appeal in TM Burke Estates Pty Ltd v. Noosa Shire Council (1998) 2 Qd.R. 448. That case involved the change in designation of land under a strategic plan (not any change to the applicable zone) which, it was accepted, practically removed any prospect of development of the land after any appropriate re-zoning. Here, as in T.M. Burke, the effect of the changes wrought in September 1991 by the introduction of the DCP were to the potential future use of the land.  They reduced its value because they put an end to the prospect which previously existed of the land being used for the sort of intense development (73 house lots and 132 building units or group title units) and consequently of being subdivided for that purpose.  (TM Burke at 450). But the question is whether these were changes which by their operation restricted subdivision and limited the size of allotments (ibid).

1. In TM Burke the Court of Appeal held that the expression “by its operation” in s.3.5(4)(c)) referred to a direct as opposed to an indirect effect.  In my view the phrase in that provision must be taken to have the same meaning when used in s.3.5(4)(d).  Thus, in s.3.5(4)(d) one must enquire whether the DCP directly prohibits or restricts the use of the land for a particular purpose, the relevant purpose here being residential purposes.

1. Mr Gore argued that the DCP did not directly prohibit or restrict the use of the land for residential purposes but merely diminished the prospects of a successful re-zoning of the whole of the land to enable residential development.  Under the Rural Pursuits zoning, which remained despite the advent of the DCP, the right to use the land for the purpose of a dwelling house continued.  So, he argued, the provisions of the DCP:

“have only an indirect effect on land use… which remains unchanged.  They indicate no more than the objectives and future intent of the [DCP] as to the use of the land and in that sense only they indicate, indirectly, that to that end, subdivision will be restricted and allotment sizes limited.”

The citation which he adopted being taken from TM Burke at p.451.

1. Had there been an actual re-zoning (a “down-zoning”) of the land, TM Burke at 451 makes it clear that s.3.5(4)(d) would have applied because such a re-zoning would have, “by its operation” prohibited or restricted the use of the land and, ordinarily, it would also indirectly affect both the right to subdivide and the size of the allotments. But, as in this case, there was no actual re-zoning but rather a change in the designation of the land in the Strategic Plan and the gazettal of a development control plan. In that event, the Court held, that the alteration to the Strategic Plan did not directly, that is, by its operation, prohibit or restrict the use of land.

1. I consider that the reasoning of the Court of Appeal in TM Burke is applicable to in this case, and I conclude that the DCP did not have the effect by its operation of prohibiting or restricting the use of the land.  Consequently s.3.5(4)(d) does not apply so as to preclude Kettering’s claim for compensation.

1. In his submissions for the Council Mr Doyle SC sought to base an argument on the fact that s.3.5(4)(d) refers not only to the use of land, but also to the erection or use of a building or other structure on the land.  In my view the inclusion of that reference was simply intended to meet the fact that schemes in the past frequently specified purposes for which buildings or other structures might be erected or used.  See Brisbane City Council v. Boral Resources (Qld) Pty Ltd (1998) 99 LGERA 84 at 94-96, per Dowsett J. I do not get any assistance from the incorporation of this phrase in the interpretation of s.3.5(4)(d).

1. I take the view that the fact that s.3.5(4)(d) uses the language of use, rather than of development, argues in favour of Mr Gore’s submission not against it, as Mr Doyle urged.  Had the provision related to a planning scheme which prohibited or restricted a particular development on land, I cannot see how Kettering could have escaped its application.  However the provision is not phrased that way, as it might have been, and that is, I think, significant.

1. Having decided, on the authority of TM Burke that s.3.5(4)(d) does not apply here, then it is not necessary to consider s.3.5(5) which in terms relates only to the exception contained in the second part of s.3.5(4)(d).  Nor need I discuss the decision in Sparke which deals solely with the meaning of s.3.5(5), other than to note that the report of the judgment does not show whether the Court was referred to TM Burke on the point whether s.3.5(4)(d) applies where there has been an amendment to a strategic plan or the gazettal of a development control plan as opposed to an actual re-zoning.