Onodi v Canada Bay Council

[2005] NSWLEC 524

Land and Environment Court

of New South Wales

CITATION:

Onodi & Anor v Canada Bay Council [2005] NSWLEC 524

PARTIES:

APPLICANTS
Zoltan Onodi
Linda Qian

RESPONDENT
Canada Bay Council
.

FILE NUMBER(S):

11382 of 2004

CORAM:

Moore C

KEY ISSUES:

Development Application :-
S94 contributions
Offset for existing development
.

LEGISLATION CITED:

Environmental Planning and Assessment Act 1979
Drummoyne and Five Dock Section 94 Contributions Plan – Car Parking in Business Centres
County of Cumberland Planning Scheme
.

CASES CITED:

Jones v Dunkel [1959] 101 CLR 298;
Rose Consulting Group v Baulkham Hills Shire Council [2003] 58 NSWLR 159; 129 LGERA 165;
.

DATES OF HEARING:

19 September 2005

 
DATE OF JUDGMENT: 

10/04/2005

LEGAL REPRESENTATIVES:

APPLICANTS
Mr R Phair, solicitor
Proctor Phair Lawyers

RESPONDENT
Mr P Jackson, solicitor
Pike Pike & Fenwick

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

MOORE C

4 October 2005

04/11382 Zoltan Onodi & Linda Qian v Canada Bay Council

The consequence of the Court’s decision in this appeal is the grant of development consent subject to detailed conditions. These conditions are not reproduced as part of this decision but are available for inspection at the Council. In addition, a copy the Court’s Orders and the conditions may be obtained from the Court’s registry upon payment of a fee. Details of the fee payable and process for obtaining a copy of the Orders and conditions are available on the Court’s web site at

JUDGMENT

1 Commissioner: This is an appeal pursuant to s 97 of the Environmental Planning and Assessment Act 1979 (the Act) against the refusal by Canada Bay Council (the council) of Development Application 202/2004 to demolish an existing single storey commercial building at 160 Victoria Road, Drummoyne (the site) and erect, in its place, a three commercial storey structure.

2 The application has gone through a number of phrases prior to its court hearing. The original application proposed a continuing commercial use on the ground floor with two residential levels above.

3 The applicants subsequently amended the plans to delete the lower of the residential levels and substitute a second commercial level. This proposal was still considered unacceptable because of inappropriate overlooking of the private open space of an existing residential property directly behind the site.

4 As a consequence, the applicants’ further amended plans include two commercial levels above the ground and no residential development. This proposal is acceptable to the council.

5 However, during these periods of negotiation, the present appeal was commenced and the matter now comes for determination, in its entirety.

6 The sole remaining matter which requiring determination, there being no disagreement about the design of the building and no third party objections to it, is the amount of contribution required to be paid to the council pursuant to a s 94 contributions Development Control Plan entitled Drummoyne and Five Dock Section 94 Contributions Plan – Car Parking in Business Centres (the DCP).

7 It is agreed by the parties that the number of car parking spaces required by the floor area of the building is nine. It is agreed between the parties that the number of car parking spaces, which arise because of the additional two levels proposed, is six. There is no dispute by the applicants about the quantum set out in the DCP for each car parking space for which a contribution should be made. This amount is $27,000 per space. The applicants concede that they are required to make a parking contribution of a $162,000 based on the second and third levels proposed to be constructed on the site.

8 The matter that is in dispute between them is whether or not they are also required to pay for a further three car parking spaces – being the car parking spaces applicable to the ground floor of the building.

9 The council says that, as a consequence of the demolition of the existing structure and the erection of an entirely new structure, the appropriate basis for applying the parking contribution is as if there was presently no development on the site.

10 The evidence given by Ms Idle, a planner employed by the council as a Specialist Assessment Officer, as to the basis of this calculation is that it is an understood (and word of mouth transmitted) policy of the council, which is not articulated in the DCP.

11 Ms Idle has also undertaken a survey of 41 councils in the greater Sydney metropolitan area to seek to understand what is the generally applied position. She obtained a significant range of results and these were reproduced in a table attached to her statement of evidence.

12 However, when questioned about a number of councils where the notation appears No stated policy, she conceded that this meant that there was no written and documented policy in some published instrument, such as a development control plan, dealing with s 94 contributions.

13 She also conceded that, if the same question were asked of Canada Bay Council, the answer (consistent with the survey question she asked) would be that Canada Bay Council has no stated policy in this regard as the policy is not one articulated in a formal instrument such as a development control plan.

14 I am therefore satisfied that the survey information which she has obtained is of little assistance to me – except to demonstrate that there are a wide variety of s 94 contributions practices across the councils surveyed. It does not assist me in circumstances such as those presently arising to be determined.

15 The applicants challenge the additional $81,000 sought by the council on two separate bases.

16 The first is that, in the present instance, representations were made to them, on two separate occasions, by officers of the council that they would be given a credit for the notional three spaces demanded by the existing building on the site.

17 The second is that, on more general grounds, it is unfair not to give credit for the notional parking required for the existing structure even though it did not provide parking nor was some contribution made toward parking at the time of its erection.

18 The reasons for this arise because the present building was erected, apparently, some 50 or more years ago and there is no information available as to the terms of consent for its erection. It was certainly, apparently, erected prior to the existence of the County of Cumberland Planning Scheme.

19 It is common ground that not only was there no parking provided on the site for the present building but also that it is reasonable to assume that there was no contribution in lieu of parking because such contributions schemes did not exist at the time that building was presumed to be erected.

20 It is in this context that the two bases of objection need to be considered.

21 As noted earlier, it is acknowledged by Mr Jackson, solicitor for the council, that the notional parking demand generated by the present structure on the site would require three parking spaces.

22 Both applicants gave evidence in the proceedings concerning two meetings which were held between them and officers of the council.

23 Notice of intention to lead this evidence and the contents of this evidence was not given to Mr Jackson until the day of the hearing, shortly before the hearing commenced. No earlier intimation, whatsoever, was given that this evidence was contemplated to form part of the applicants’ case – let alone said to be a determinative basis for their position.

24 Mr Phair, solicitor for the applicants, explained that he was not aware of this proposed evidence until that time and that he had informed Mr Jackson as soon as he could.

25 Nonetheless, this evidence must be considered in the circumstances where the council has been given no realistic opportunity to respond to it by seeking to ascertain details of the officers who attended these meetings and obtain statements of evidence in reply from them.

26 I do not understand that the occurrence of these meetings is disputed – merely that the council had, in effect, been “ambushed” as to what the applicants say was discussed at each of them – relevantly what was, on the applicants’ evidence, said about parking contributions.

27 The first of the meetings took place prior to the applicants deciding to purchase the building. Each applicant gave evidence that, during the course of the first meeting, the question of parking requirements was discussed and that they were informed they would be given a credit equivalent to the parking demand required by the present structure. They both gave evidence that this was a matter of importance to them in considering the economic viability of the proposal.

28 The only persons who were present at this meeting were a council officer named Adam, whose surname is unknown, and the applicants (according to Ms Qian), but their architect was also present (according to Mr Onodi).

29 Both applicants gave evidence that this was their first commercial property investment and they were, as a result, being very cautious about its viability.

30 The second meeting took place between an officer of the council, about whom no identifying evidence has been given other than she appeared to be of “Chinese appearance”.

31 Both applicants gave evidence that, on this occasion, in addition to themselves and the council officer, Mr Katchikian, their architect, was in attendance.

32 This meeting took place some two weeks or so prior of the lodgement of the development application which is the subject of this appeal. The development application was lodged with the council on 7 April 2004. A Statement of Environmental effects prepared by the applicants' architect and dated March 2004 accompanied it.

33 The evidence given by the applicants as to the discussion with the council officer at the second meeting on the issue of parking was in the same terms as their evidence with respect to the discussion with the first meeting. That evidence is that there was an unambiguous and unqualified assurance given to them that they would be entitled to a credit for the existing parking space demand for the present building.

34 This position, allegedly put by council officers on two separate occasions, is contrary to what Ms Idle says is the policy known all development assessment officers employed by the council.

35 Ms Idle also gave evidence that, had there been an existing but earlier s 94 contribution paid with respect to the parking shortfall occasion by the present structure, and off set for that, equivalent to the three additions spaces now in contention, would be given to the applicants.

36 The relevant portion of the Statement of Environmental effects dealing with parking contributions is only partially consistent with the evidence given by the applicants.

37 The statement in the Statement of Environmental Effects, which I am satisfied that it is reasonable to assume was finalised by Mr Katchikian after the second meeting took place with the council, reads, relevantly, as follows (at page 15):

The existing premises would have generated the need for three (3) spaces on site. However, there is no current on-site car parking. It is assumed that at the time the original development was approved, the previous owner would have paid a contribution in lieu of car parking. Therefore, a credit of three (3) car parking spaces exists on the site. [emphasis added]

38 This position is consistent with the position outlined by Ms Idle in her evidence.

39 Mr Katchikian has not been called to give evidence in these proceedings about this matter nor has he provided a written statement of evidence in these proceedings, particularly, about the March 2004 meeting.

40 I am satisfied, therefore, that it is open to me to draw the inference that his evidence, if given, would not be of assistance to the applicants (see: Jones v Dunkel [1959] 101 CLR 298). I draw that inference.

41 I am satisfied on the basis of the evidence given by Ms Idle as to the consistent policy applied by the council and from the extract of the Statement of Environmental Effects that the applicants would have been informed that, had a previous contribution been made for parking for the existing structures deficit, and off set would have been available to them.

42 I am satisfied that it would be unreasonable to determine that what was told to them was that an offset would be available, in absolute terms, for the present structure – whether or not a prior contribution had been made.

43 I therefore reject the proposition that the applicants should be entitled to a credit for the present building on the basis of any representations made to them by the council as I am satisfied, on the balance of probabilities, that no such representation was, in fact, so made.

44 However, that is not the end of the matter. The second basis that was put on behalf of the applicants was that, as general proposition, notwithstanding what might be the policy of this or any other council, it was inappropriate to charge a levy without taking in account the existing structure as this was contrary to the provisions of s 94(1), which reads:

(1) If a consent authority is satisfied that development for which development consent is sought will or is likely to require the provision of or increase the demand for public amenities and public services within the area, the consent authority may grant the development consent subject to a condition requiring:

(a) the dedication of land free of cost, or
(b) the payment of a monetary contribution, or both.

45 This submission, in effect, invites me to consider general policy issues relating to the impact and imposition of s 94 contributions of this nature by this council under these circumstances.

46 In effect, what I am asked to consider is the appropriateness or otherwise an unwritten policy which is passed from officer to officer with the uniformity of its observance being ensured, according to Ms Idle’s evidence, by the relevant manager checking applications to check that this occurs.

47 As a consequence, I am considering a more general question namely one of principle relating to the merit of this unwritten policy not the merits of it being an unwritten policy.

48 During the course of the hearing, I indicated to Mr Jackson and Mr Phair that I considered it possible that matters raised of a general nature [that is those not relying on the alleged representations made to the applicants], potentially raised a significant matter of principle which warranted consideration in a general sense rather than merely in the particular circumstances of this case. I asked whether either of them would, in their closing submissions, deal with the matters of principle rather than merely with the specifics of the present case.

49 The matter of principle which might be considered could be stated as follows:

Is it appropriate that an offset should be given for s 94 contributions equal to the extent that any existing development on a site would contribute to the calculation of the amount of contribution required for that site?

50 If a question were posed in those general terms, it would have equal applicability in residential and commercial industrial zonings and in all local government areas where s 94 contributions plans apply.

51 To pose and answer a question in such terms, arising out of the present case, might lead to an inappropriate answer given that the circumstances of the present case arise from an unwritten policy imposing a burden which is not immediately obvious to a reader of the specific s 94 contributions plan involved in these proceedings.

52 I have, therefore, concluded that, although the enunciation of a planning principle to deal with these matters might be desirable, this case is not an appropriate vehicle for that purpose.

53 Mr Phair tendered a letter from a builder who had provided what could be described as an informal advice of costs (rather than a formal and detailed quotation) for the erection of the new building. This cost was stated to be $210,000.

54 I note that the cost of re-development was stated in the development application as being $250,000 but, given the conclusion that I have reached with respect to this letter, nothing would turn on it.

55 Mr Phair sought to submit to that this cost of development demonstrated the unreasonableness of the parking contribution because the parking contribution, if imposed at the level put by the council, would be greater than the cost of the building. I am satisfied, as I indicated to Mr Phair at the time, that such a submission is a red herring and has no relevance in this appeal.

56 I have, therefore, concluded that I should determine this matter simply by testing, in the first instance, whether the additional contribution sought is adequately founded on a proper construction of the s 94 contribution plan itself. I am satisfied that it is not.

57 The s 94 contribution plan for parking in the Drummoyne and Five Dock commercial centres fails to state, expressly, that credits will be given if there is a pre-existing development for which a contribution has been paid, and conversely, that in circumstances where there is a pre-existing development and no contribution has been paid for it as a result of the age of the consent, no credit would be given.

58 Indeed, it is impossible to read into the terms of the present DCP the terms of the unwritten policy which is, in fact, applied by the council.

59 The only possibly relevant words of the DCP which describe the broad aims of this and similar plans read as follows:

These contributions relate to the additional demand for car parking in the Five Dock and Drummoyne business centres within the City of Canada Bay (CCB) that is created by new development, where that additional demand is not met through parking facilities provided by the developer. [emphasis added]

60 In Section 1 of the DCP, the geographic application of the plan is described:

This plan applies to all non-residential development on all land in the Drummoyne business centre as outlined on Map 1 – Drummoyne Business Centre, and on certain land in the Five Dock business centre as outlined on Map 2 – Certain Land in Five Dock Business Centre.

61 There is no dispute that the site is within the scope of the plan’s catchment.

62 In Section 2 of the DCP, the relevant purpose of the plan is described as:

The purpose of this plan is to:

a) enable Council to levy a contribution under Section 94 of the Environmental Planning and Assessment Act when granting consent to the carrying out of development on land to which this plan applies that will increase the demand for car parking in the Drummoyne business centre, [emphasis added]

63 It is clear that the additional demand or development which will increase the demand for car parking, on the ordinary meaning of those words, can only refer to the additional parking of six spaces and not to the pre-existing parking demand calculated by reference to the present structure. In this regard, the nature and degree of the redevelopment of the ground is irrelevant provided it does not increase, itself, the calculated parking demand.

64 I am therefore satisfied that the unwritten policy is, in fact, contrary to the terms of the written plan. The demand for the additional three parking contributions cannot be sustained on this basis.

65 However, if I were wrong in reaching this conclusion, I turn to the more general issue of fairness and the discretion I have in this regard (see Rose Consulting Group v Baulkham Hills Shire Council [2003] 58 NSWLR 159; 129 LGERA 165).

66 Therefore, entirely disregarding the alleged representations make the applicants [as I have earlier found is appropriate to do], the question is whether, under all circumstances, it is fair or not to disregard the present calculated parking demand generated by the building which will be replaced and which has, in the mists of time, been approved without requirement for parking or contribution in lieu thereof.

67 It would have been open to the council to enunciate, clearly, its position on these matters and to include such information on its s 149 certificates. It has not chosen to do so and, under all the circumstances, I consider that it would have been fair to have put on notice, expressly and unambiguously, persons who might seek to re-develop buildings, from an era when such contribution regimes did not apply, that no credit was to be given for the demand for parking which was generated from the existing building on the site.

68 I am satisfied that, in circumstances where there is no express and explicit provision in the s 94 contribution plan to the contrary, it is reasonable under the physical circumstances and development history in this case to conclude that the additional parking demand which will be created will be of six car parking spaces only. There is nothing in the plans for the proposed development which would indicate an intensification of use of the existing commercial area after the site is re-developed to warrant any inference that there was a change which warranted the imposition of an additional contribution. It is therefore unfair to require what amounts to a retrospective contribution attributable to that element of the proposal equivalent to the existing development on the site.

69 I have, therefore, concluded that the s 94 contribution condition, condition 70, should be amended so that the basis of parking calculation is six car parking spaces rather than nine. This will have the effect of reducing, by $81,000, the parking contribution required to be payed by the applicants.

70 If the council were to incorporate its unwritten policy, precisely and explicitly, in a s 94 contribution plan, a challenge to the reasonableness of that would give rise to different issues which do not require to be canvassed in this decision.

71 The orders of the Court, therefore, are:

1. The appeal is upheld;
2. Development Application 202/2004 for the demolition of the existing building at 160 Victoria Road, Drummoyne and the erection, in its place, of a three storey commercial building, in accordance with plans ODA-1-D to ODA-6-D (all Issue A and all dated May 2005) by Vahan Pty Ltd, is granted development consent subject to the conditions in Annexure A; and
3. The exhibits, except for Exhibit 9, are returned.

Tim Moore
Commissioner of the Court