Omaya Investments Pty Ltd v Dean Street Holdings Pty Ltd (No. 2)

[2019] NSWLEC 136

Land and Environment Court

New South Wales

Medium Neutral Citation:	Omaya Investments Pty Ltd v Dean Street Holdings Pty Ltd (No. 2) [2019] NSWLEC 136
Hearing dates:	24 September 2019
Date of orders:	25 September 2019
Decision date:	25 September 2019
Jurisdiction:	Class 4
Before:	Duggan J
Decision:	See paragraphs [36] and [37]
Catchwords:	ENVIRONMENT AND PLANNING – Land and Environment Court – practice and procedure - notice of motion - extension of time – commencement of proceedings – judicial review – development consent – exercise of discretionary powers – public interest – leave granted
Legislation Cited:	Environmental Planning and Assessment Act 1979 Land & Environment Court Act 1979 Uniform Civil Procedure Rules 2005
Cases Cited:	Bankstown City Council v Ramahi [2015] NSWLEC 74 Wingecarribee Shire Council v Uri Turgeman trading as Uri T Design [2018] NSWLEC 146
Category:	Procedural and other rulings
Parties:	Omaya Investments Pty Ltd (Applicant) Dean Street Holdings Pty Ltd (First Respondent) TQM Design and Construct Pty Ltd (Second Respondent) Patrick John Elias (Third Respondent) Maurice Freixas (Fourth Respondent) Burwood Council (Fifth Respondent)
Representation:	Counsel: M Wright SC and J Walker (Applicant) C Leggat SC and L Nurpuri (First to Third Respondents) Submitting Appearance (Fourth Respondent) R White (Fifth Respondent)   Solicitors: Project Lawyers (Applicant) Salim Rutherford Lawyers (First to Third Respondents) Jaku Legal (Fourth Respondent) Houston Dearn O’Connor Lawyers (Fifth Respondent)
File Number(s):	2019/228381
Publication restriction:	No

Judgment

1. By Notice of Motion filed 18 September 2019 the Applicant seeks leave, pursuant to r 59.10 of the Uniform Civil Procedure Rules 2005 (UCPR) to extend time to commence proceedings seeking firstly, judicial review of the second development consent granted on 3 March 2016 and secondly, judicial review of CC1 issued on 8 March 2018.

2. The affidavit of Mr Ostermeyer, sworn 17 September 2019 was read (without objection) in support of the Notice of Motion.

3. The only other evidence tendered on the Notice of Motion dated 18 September 2019 was the public notice placed in the local newspaper on 24 March 2016, giving notice of the approval of the second development application, pursuant to what was at that time s 101 of the Environmental Planning and Assessment Act 1979 (EP&A Act), now being s 4.59. That document was marked Exhibit R5.1 on the Notice of Motion.

4. On 24 September 2019 the Applicant made a further oral application seeking leave to amend its Summons and Points of Claim in the manner identified in the Third Further Amended Summons and the Third Further Amended Points of Claim, which have become Exhibit A on the Notices of Motion.  I have been asked to determine the Notice of Motion filed on 18 September 2019 on the basis of the pleadings as sought to be amended by Exhibit A. 

5. The First to Third Respondents and the Fifth Respondent, collectively referred to as the Respondents, oppose the grant of leave, pursuant to r 59.10, but do not otherwise oppose the amendments, as proposed in Exhibit A. Rule 59.10 provides:

59.10    Time for commencing proceedings

(1)    Proceedings for judicial review of a decision must be commenced within 3 months of the date of the decision.

(2)   The court may, at any time, extend the time for commencing proceedings fixed by subrule (1).

(3)   In considering whether to extend time under subrule (2), the court should take account of such factors as are relevant in the circumstances of the particular case, including the following:

(a)   any particular interest of the plaintiff in challenging the decision,

(b)   possible prejudice to other persons caused by the passage of time, if the relief were to be granted, including but not limited to prejudice to parties to the proceedings,

(c)    he time at which the plaintiff became or, by exercising reasonable diligence, should have become aware of the decision,

(d)   any relevant public interest.

(4)   This rule does not apply to proceedings in which there is a statutory limitation period for commencing the proceedings.

(5)   This rule does not apply to any proceedings in which the setting aside of a decision is not required.

Does r 59.10 apply to the claims relating to the second development consent, as referred to in Order 1 of the Notice of Motion? 

6. As provided for in r 59.10(4) the rule does not apply to proceedings in which there is a statutory limitation period for commencing proceedings. Section 4.59 of the EP&A Act provides:

4.59   Validity of development consents and complying development certificates

(cf previous s 101)

If public notice of the granting of a consent or a complying development certificate is given in accordance with the regulations by a consent authority or a certifier, the validity of the consent or certificate cannot be questioned in any legal proceedings except those commenced in the Court by any person at any time before the expiration of 3 months from the date on which public notice was so given.

7. Public notice of the second development consent was given, as evidenced by Exhibit R5.1.  Mr Wright, senior counsel for the Applicant, did not contend that the notice given was otherwise a proper notice given under that section.

8. Accordingly, the provisions of r 59.10 do not apply to the judicial review of the development consent insofar as such claim questions the validity of the grant of the second development consent.

9. The Third Amended Summons only has two paragraphs that deal with the second development consent. These are [2C] and [8]. The Third Amended Summons pleads at [2C]:

2C   A declaration that the development consent granted on 3 March 2016 (DA 2015.98.1) for, inter alia, three additional building levels containing 8 residential apartments (Second Development Consent) is invalid and of no effect.

10. As presently drafted the claim at [2C] is so broad it is capable of being said to be questioning the validity of the grant of the second development consent, which takes it outside the operation of r 59.10 and, therefore, leave is not required. If the relevant application of the provisions of s 4.59 of the EP&A Act apply that question will be required to be determined in the proceedings.

11. The Third Amended Summons provides at [8]:

A declaration that, in breach of s 4.2(1)(b) of the EPA Act, the first and/or second respondents have carried out development on the Development Site not in accordance with the First Development Consent and/or the Second Development Consent by undertaking shoring and piling works otherwise than in accordance with the CC1 plans (as defined in the Further Amended Points of Claim).

12. The declaration sought is not one that requires the validity of the grant of the consent to be questioned and is therefore not the subject of the limitation period for the commencement of proceedings contained in s 4.59 of the EP&A Act. Further, it does not require the setting aside of a decision and therefore, pursuant to r 59.10(5), the rule does not apply, and leave is not required.

13. For these reasons I dismiss Order 1 of the Notice of Motion dated 18 September 2019, as leave is not required.

Should leave be granted, pursuant to r 59.10 relating the judicial review of CC1, Order 2 in the Notice of Motion? 

14. It was accepted by the parties that the claims proposed by the Applicant as they related to CC1 are in the nature of judicial review of the decision of the certifier to give the construction certificate and therefore are the subject of the relevant time period referred to in r 59.10(1) and for which leave may be given to extend time in accordance with r 59.10(2). This is not a decision to which s 4.59 of the EP&A Act relates as it is neither the grant of a development consent or a complying development certificate, as those terms are defined in the EP&A Act.

15. The date of the decision to give CC1 was 8 March 2018. Therefore the proceedings should have been commenced on or before 8 June 2018. The proceedings were commenced on 23 July 2019, some 13 months outside of the three months specified in r 59.10(1), and the application for leave to commence proceedings challenging CC1 was filed on 18 September, such further time period being outside the three months.

16. Whether to extend time is a discretionary determination. The principles relevant to the exercise of the discretion for leave under r 59.10 was summarised by Pepper J in Wingecarribee Shire Council v Uri Turgeman trading as Uri T Design [2018] NSWLEC 146 at [33] ‑ [34] in the following terms:

33. The principles relevant to an application for leave under r 59.10(2) of the UCPR have been stated in a number of recent decisions in this Court (Temelkovski v Wright [2016] NSWLEC 112; (2016) 218 LGERA 381; Yves Deyris v Elizabeth Jones [2017] NSWLEC 165; Moorebank Recyclers Pty Ltd v Tanlane Pty Ltd [2017] NSWLEC 97; Fenwick v Woodside Properties Pty Ltd [2016] NSWLEC 104; (2016) 217 LGERA 453; Bankstown City Council v Ramahi [2015] NSWLEC 74 and Mosman Municipal Council v IPM Pty Ltd [2016] NSWLEC 26; (2016) 216 LGERA 252).

34.   They may be summarised as follows:

(a)   the applicant bears the onus of establishing why the Court should exercise its discretion to extend time in his or her favour;

(b) the factors to be considered on any application for leave to extend time are not limited to those in r 59.10 of the UCPR, but include:

(i)   the length of the delay;

(ii)   the reasons for the delay (noting that the failure to seek    legal advice is not a compelling explanation); and

(c)   whether the applicant has a fairly arguable case;

(d)   the weight to be given to relevant factors will depend upon the circumstances of the particular case and will require the Court to carry out a balancing exercise;

(e)   the question of potential prejudice to a party caused by the delay is a significant consideration;

(f) the rule of law is strengthened by provisions such as r 59.10 of the UCPR requiring the discipline of bringing proceedings within a reasonable time so that the proper business of government and the reasonable interests of third parties are not unjustly prejudiced;

(g) in considering r 59.10 of the UCPR, it should be borne in mind that a claimant cannot fairly be criticised for failing to take action before he or she knew, or by exercising reasonable diligence should have known, that there was anything to take action about (Regional Express Holdings Ltd v Dubbo City Council (No 2) [2013] NSWLEC 113 at [7] and Moorebank Recyclers at [14]);

(h)   in considering delay in an application for extension of time the Court has frequently made a distinction as to the unreasonableness of the delay on the basis of intention. There is a difference between intentional or contumelious delay (Tomko v Palasty (No 2) [2007] NSWCA 369; (2007) 71 NSWLR 61 at [56], that is, delay caused by “deliberate inaction” (IPM at [82]) or “an intentional decision to delay” (Moorebank Recyclers at [52]), and delay which is merely the result of a “bona fide mistake or blunder” (Tomko at [56]), mere “oversight” (IPM at [82]), or caused by seeking to clarify rights and trying to solve the matter without litigation (Yves Deyris at [13]); and

(i)   there is danger in placing too much emphasis on the prospects of success. To do so invites the parties to treat the application as a dress rehearsal for the full appeal (Jackamarra v Krakouer [1998] HCA 27; (1998) 195 CLR 516 at [9]). It is not necessary, or appropriate, for the applicant to do more than demonstrate a fairly arguable case. It is not necessary nor appropriate to demonstrate in any detail the prospects of success (Tomko at [58]).

17. I adopt that summary and I will deal with the relevant matters in turn. 

The Applicant's interest in challenging the decision, r 59.10(3)(a) 

18. The Applicant is the owner of adjoining land.  It also has a right under the open standing provisions to bring proceedings such as these pursuant to the legislative scheme and Division 9.5 of the EP&A Act.  I consider the proximity of the Applicant's landholding to be an interest that is justifiable as any development on Respondents’ land has the capacity to affect the adjoining land in a more immediate way than if the land was more remote. 

19. The First to Third Respondents, at [159] of its written submissions, contend that the Applicants are commercial competitors and it is disgruntled as a consequence of failed property negotiations with the Respondents. I need not make any findings on this Motion as to whether such allegation is in fact correct.  I note those submissions, but find that even if I accepted it at its highest, the proximity of the landholding in this case is a sufficient interest that would not be outweighed by the asserted other motivations of the Applicant. 

Possible prejudice caused by the delay, r 59.10(3)(b) 

20. The prejudice to which this consideration is directed is primarily the prejudice caused by the Applicant not commencing the proceedings within the three months with the relevant comparator being the expense that the Respondent will likely incur if leave is given to extend time compared to the expenses that the Respondent would have incurred if the proceedings were commenced within that time:  see Bankstown City Council v Ramahi [2015] NSWLEC 74 at [86].

21. Mr Leggat, senior counsel for the First to Third Respondents, submitted that the prejudice that his clients suffered was outlined at [158] to [159] of his outline of submissions dated 20 September 2019.  In essence it is submitted that the prejudice is that the Applicant had “sat idle” while those Respondents had purchased the site and caused expensive and extensive work to be carried out.  The time periods during which this prejudice is said to arise is calculated from the date of the grant of the CC1 to the commencement of proceedings. 

22. As observed above the relevant comparator is the difference in time between commencement within three months and the extended time, not the date of the impugned decision. I accept that even on that basis the period of the extension sought is not insignificant. It is well in excess of a year. It is clear on the Applicant's own pleadings the building works commenced on or about August 2019 and significant excavation works occurred prior to that time. Both of these events occurred within the period after the time period provided for in r 59.10(1).

23. I accept that the First to Third Respondents will potentially suffer an unquantified but material financial prejudice when the time period for challenging the validity of CC1 is compared to the time period represented by the extension presently sought. However, for reasons I express below I do not accept that the totality of such prejudice is attributable to the leave sought in the Notice of Motion. 

Length of delay and reasons for delay, r 59.10(3)(c) 

24. The delay, I accept, is significant.  However, the length of the delay must be considered in light of the reasons for the delay.  As submitted by the Applicant a construction certificate is not a type of approval that is required to be publicly notified and therefore independent knowledge must be obtained and access to relevant documents sought.  The relationship of the date of the grant of CC1 to the date of the asserted lapse of the first development consent could not have been ascertained without investigations.

25. I find that having regard to the nature of the relationship of CC1 to the circumstances of the lapse and whether the execution of the VPA impacted upon the power to grant CC1 are matters that are not generally ascertainable without investigation and some factor to trigger a person to undertake such investigations.  Therefore, I find that whilst the period of time for which leave is sought is relatively significant the circumstances surrounding the necessary fact finding are a reasonable explanation for the period of the delay in the bringing of the proceedings to challenge the decision to grant CC1.

Relevant public interest, r 59.10(3)(d) 

26. As a general proposition the imposition of time limits with respect to judicial review proceedings express the general public interest in providing some certainty with respect to decisions to enable persons who are the beneficiaries of such decisions to act upon them without fear of the decision being the subject of challenge. However, that interest and certainty is tempered by the provisions of r 59.10 itself that permits, with leave, for the time to be extended. The requirement of leave provides a judicial oversight to ensure that only in cases where the circumstances warrant is time extended.

27. I was also directed to the provisions of s 22 of the Land & Environment Court Act 1979 (LEC Act) that provides:

22   Determination of matter completely and finally

The Court shall, in every matter before the Court, grant either absolutely or on such terms and conditions as the Court thinks just, all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by that party in the matter, so that, as far as possible, all matters in controversy between the parties may be completely and finally determined and all multiplicity of proceedings concerning any of those matters may be avoided.

Whilst not directly on point, that provision indicates that in appropriate circumstances all issues in dispute between parties in proceedings in this Court should be ventilated and resolved in a single set of proceedings. 

28. No other matters of public interest were raised by the parties.  I weigh these considerations in the exercise of my discretion. 

Fairly arguable case 

29. It was submitted by the Respondents at [160] of its written submissions that the Applicants do not have a fairly arguable case as the law relating to the lapse of development consents is well settled and that on this aspect of the case the Applicants suffer insurmountable factual difficulties.

30. I am considering whether to grant an extension of time to permit judicial review of the decision to grant CC1, not a case of whether the first development consent has lapsed.  Accordingly, I do not accept the characterisation of the case by the Respondents referring to the lapse issue as being the appropriate question.  It appears clear that if the Applicant is successful in establishing that the first development consent has lapsed, the question as to whether the decision to grant CC1 after the date of lapse is a matter that is arguable.

Nature of these proceedings and the circumstances of this case 

31. It is important to observe that the proceedings relate primarily to whether the first development consent has lapsed. That claim does not involve judicial review of a decision as referred to in r 59.10 or a challenge to the validity of the decision to grant that consent to which the provisions of s 4.59 of the EP&A Act would apply, and therefore, has no time limitation as to the time with which such proceedings must be commenced. As a consequence, these are not circumstances where the Respondents would find themselves free of these particular proceedings if leave were not granted. The delays, the financial prejudice, and the litigation would still be required to be suffered by the Respondents to a similar degree.

32. Further, the proceedings also raise for determination the nature and scope of the woks authorised by CC1 and whether the work actually carried out in reliance of CC1 are authorised by a construction certificate comprising either CC1 or a variation to CC1.  Those issues are also able to be commenced without time limitation. 

33. I find that the nature of the existing proceedings are complex both factually and legally, and raise for determination factual matters based on evidence which would be common to the existing pleadings and the pleadings for which leave is sought.  I further find that the existing proceedings raise principal claims that are not the subject of a limitation period and therefore the Respondents would still be involved in the proceedings even if leave was not granted.

31. I further find that the pleadings for which leave is sought are, in large part, not independent of the challenge to the making of the decision to grant CC1 but rather are seeking to examine the consequence of the asserted lapse of the first development consent on the legal capacity of the certifier to make the decision to give CC1.

32. In the weighing of the relevant factors outlined in these reasons, I find that the circumstances of this case warrant the leave being sought in Order 2 of the Notice of Motion be granted.

33. Accordingly, the Court orders that:

1. Pursuant to r 59.10 the Applicant is given leave to commence proceedings seeking judicial review of the decision to grant CC1 in accordance with the terms of the Third Further Amended Summons and Points of Claim. The time to commence such proceedings is extended to 25 September 2019;

2. The Applicant is given leave to rely upon the Third Further Amended Summons and Points of Claim with the addition of the handwritten amendment to 15D(B)(i) of the Summons;

3. The cost of the Notices of Motion are reserved;

4. The Motion is otherwise dismissed.

37. The Court further directs:

1. The Applicant is to file and serve by 2pm on 25 September 2019 the Third Further Amended Summons and Points of Claim as amended in accordance with Order 2 above;

2. The Respondents are to file and serve by 10am on 26 September 2019 any amended Points of Defence in response to the Summons and Points of Claim served in accordance with Direction 1, above.

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Decision last updated: 26 September 2019