Presrod Pty Limited v Wollongong City Council

[2012] NSWLEC 240

Land and Environment Court

New South Wales

Medium Neutral Citation:	Presrod Pty Limited v Wollongong City Council [2012] NSWLEC 240
Hearing dates:	28 and 29 May 2012
Decision date:	29 October 2012
Jurisdiction:	Class 1
Before:	Sheahan J and Brown C
Decision:	(1) The applicant's appeal under s 97 of the Environmental Planning and Assessment Act 1979, against the respondent's refusal to grant approval to DA 2011/112 is dismissed. (2) Costs are reserved. (3) All exhibits are returned to the parties.
Catchwords:	DEVELOPMENT APPLICATION: conversion and reconfiguration of existing hotel, studio, and dual key apartments - whether the proposed development is prohibited as the site does not benefit from existing use rights - whether the proposed development will adversely impact on the amenity of adjoining properties by way of traffic noise and loss of privacy
Legislation Cited:	Environmental Planning and Assessment Act 1979 Interpretation Act 1987 Land and Environment Court Act 1979 Wollongong Local Environmental Plan 2009 Wollongong Local Environmental Plan 2007 Wollongong Development Control Plan 2009
Cases Cited:	Dorrestijn v South Australia Planning Commission [1984] HCA 76; (1984) 54 LGRA 99 Caltex Australia Petroleum Pty Ltd v Manly Council [2007] NSWLEC 105; (2007) 155 LGERA 255 Currency Corp Pty Ltd v Wyong Shire Council [2006] NSWLEC 692; (2006) 155 LGERA 230 Gordon & Valich Pty Ltd v City of Sydney Council [2007] NSWLEC 780 Parramatta City Council v Brickworks Limited (1972) 128 CLR 1 Presrod Pty Limited v Wollongong City Council [2010] NSWLEC 1257 Presrod Pty Limited v Wollongong City Council (Unreported, NSWLEC, 23 October 2009) Reading Properties Pty Ltd v Auburn Council [2007] NSWLEC 186; (2007) 158 LGERA 116 Waverley Council v CM Hairis Architects [2002] NSWLEC 180; (2002) 123 LGERA 100 Wingecarribee Shire Council v Pancho Properties Pty Ltd [2001] NSWCA 271; (2001) 117 LGERA 104
Category:	Principal judgment
Parties:	Presrod Pty Limited (Applicant) Wollongong City Council (Respondent)
Representation:	COUNSEL: Mr I Hemmings, barrister (Applicant) Ms S Duggan SC (Respondent) SOLICITORS: Maguire & McInerney (Applicant) Wollongong City Council (Respondent)
File Number(s):	10101 of 2012

Judgment

Introduction

1. This is an appeal under s 97 of the Environmental Planning & Assessment Act 1979 (EPA Act) against the refusal by Wollongong City Council ("the Council") of development application ("DA") 2011/1112, ("the subject application") for the conversion and reconfiguration of some hotel accommodation suites in an existing hotel at 39 Smith Street, Wollongong ("the site").

1. The Statement of Facts and Contentions (Exhibit C1) describes the proposal as:

...the conversion of 2 x 1 bedroom and 2 x 2 bedroom hotel suites (two on the first floor, the remaining two on the second floor) into eight studio apartments (a total increase of four units); and the conversion of eight two bedroom hotel apartments on the second floor, into dual key one bedroom hotel suites and studios. This will include the creation of a possible seven new suites adjoining seven approved hotel apartments and connection of two approved units together, providing an option for 16 dual key apartments. This represents a total increase of 11 units over the existing number of units.

1. The respondent contends that the proposed development is prohibited, and that the site does not benefit from existing use rights (Contention 1 - Exhibit C1, p 8). It also argues that the proposed development will have an unacceptable impact on the amenity of adjoining residential development by way of increased traffic noise and loss of privacy (Contentions 2, 3 and 4 - Exhibit C1, pp8-9).

1. I gratefully acknowledge the assistance of Commission Brown in determining this matter.

The expert, lay, and council evidence

1. Expert evidence was provided on the issues of traffic and parking, and on the loss of privacy contentions, by Mr Michael Brown, for the Council (Exhibit C2), and Mr Terry Wetherall, for the applicant (Exhibit A1). The Court also had the benefit of a joint report, dated 10 May 2012 (Exhibit C5).

1. During our inspection of the site and its environs, on 28 May 2012, the Court heard submissions from the following objectors: Mr Harold Hanson, Mr Terry Sim, Mr John Greenlees, Ms Helga Burnett, Mr Leonard Smith and Mr Graeme Wells, of whom either reside, or own property, in close proximity to the site. A written copy of their objections was provided to the Court, and tendered as Exhibit C3. Their concerns can be summarised as:

• increased traffic,
• inadequate parking,
• loss of privacy, and
• noise impacts from cars and patrons.

1. Additional written objections/submissions received by the Council were also provided to the Court, and are found in Council's bundle of documents - Exhibit C6, tab 10.

1. Council's bundle (Exhibit C6) also contains various other documents including an aerial photo, an extract from the zoning map, and the land zoning sheet.

1. A copy of the plans for which consent was sought was tendered (see Exhibit A2). In the event that the Court finds in favour of the applicant, and allows the development, agreed without prejudice conditions for the development, were also provided to the Court (Exhibit C7). Apart from general conditions relating to the appointment of a principal certifying authority, and the issue of a construction certificate, there is also a condition requiring the plan of management forming part of the approval documentation to be complied with at all times (Exhibit C7, par 48).

The Statutory regime

1. DAs must be made, considered and determined in accordance with the EPA Act.

1. Division 1 of Part 4 of the Act sets out the circumstances in which development consent ("DC") is required, and Part 4 Div 2 lays down the procedures to be followed where a DC is so required. The following sections are of specific relevance:

76B Development that is prohibited

If an environmental planning instrument provides that:

(a) specified development is prohibited on land to which the provision applies, or

(b) development cannot be carried out on land with or without development consent,

a person must not carry out the development on the land.

...

77 Application of Division

This Division:

(a) applies to development that may not be carried out except with development consent, but

(b) does not apply to complying development.

Note. Under this Part, the procedures by which development consent is obtained differ according to whether the development:

(a) is or is not State significant development, and

(b) is or is not designated development (which it may be declared to be by an environmental planning instrument or the regulations), and

(c) is or is not integrated development (see Division 5).

78 The development consent process-the main steps

The main steps in the development consent process are set out in sections 78A-81 and in the regulations made for the purposes of this Part."

...

80A Imposition of conditions

(1) Conditions-generally

A condition of development consent may be imposed if:

(a) it relates to any matter referred to in section 79C (1) of relevance to the development the subject of the consent, or

(b) it requires the modification or surrender of a consent granted under this Act or a right conferred by Division 10 in relation to the land to which the development application relates, or

(c) it requires the modification or cessation of development (including the removal of buildings and works used in connection with that development) carried out on land (whether or not being land to which the development application relates), or

(d) it limits the period during which development may be carried out in accordance with the consent so granted, or

(e) it requires the removal of buildings and works (or any part of them) at the expiration of the period referred to in paragraph (d), or

(f) it requires the carrying out of works (whether or not being works on land to which the application relates) relating to any matter referred to in section 79C (1) applicable to the development the subject of the consent, or

(g) it modifies details of the development the subject of the development application, or

(h) it is authorised to be imposed under section 80 (3) or (5), subsections (5)-(9) of this section or section 94, 94A, 94EF or 94F.

1. Division 10 of Part 4 of the Act also makes provision for the continuation of uses, which were once permissible, but which become prohibited. The following sections of that division are of relevance:

106 Definition of "existing use"

In this Division, existing use means:

(a) the use of a building, work or land for a lawful purpose immediately before the coming into force of an environmental planning instrument which would, but for Division 4 of this Part, have the effect of prohibiting that use, and

(b) the use of a building, work or land:

(i) for which development consent was granted before the commencement of a provision of an environmental planning instrument having the effect of prohibiting the use, and

(ii) that has been carried out, within one year after the date on which that provision commenced, in accordance with the terms of the consent and to such an extent as to ensure (apart from that provision) that the development consent would not lapse.

...

108 Regulations respecting existing use

(1) The regulations may make provision for or with respect to existing use and, in particular, for or with respect to:

(a) the carrying out of alterations or extensions to or the rebuilding of a building or work being used for an existing use, and

(b) the change of an existing use to another use, and

(c) the enlargement or expansion or intensification of an existing use.

...

109B Saving of effect of existing consents

(1) Nothing in an environmental planning instrument prohibits, or requires a further development consent to authorise, the carrying out of development in accordance with a consent that has been granted and is in force.

(2) This section:

...(a) applies to consents lawfully granted before or after the commencement of this Act, and

...(b) does not prevent the lapsing, revocation or modification, in accordance with this Act, of a consent, and

...(c) has effect despite anything to the contrary in section 107 or 109.

(3) This section is taken to have commenced on the commencement of this Act.

Relevant planning controls

1. The site is zoned R1 General Residential under Wollongong Local Environmental Plan 2009 ("LEP 2009"), and use for the purpose of "hotel or motel accommodation" is prohibited in that zone.

1. Clause 1.1AA states that the "Plan commences on the day on which it is published on the NSW legislation website". Relevantly, it was gazetted on 26 February 2010 (see Exhibit C6, tab 1), with the subject application being lodged on 16 September 2011.

1. The planning instrument in force prior to LEP 2009 was Wollongong Local Environmental Plan 2007 ("LEP 2007"). Under LEP 2007, the site was within Zone B4-Mixed Use. Hotel accommodation was not listed as a prohibited use within this zone, and, based on the construction of the zoning table, was permissible with DC.

1. Wollongong Development Control Plan 2009 (DCP 2009) also applies to the site, and provides requirements for visual and acoustic privacy (Ch D13, cll 6.12 and 6.13) and car parking (Ch E3, Sch 1).

The site and surrounding area

1. The site is Lot 31 in DP 747755. It is a hatchet shaped allotment with a frontage to Smith Street of 25.02 m, a depth of 101.33 m, and a rear boundary of 40.7 m, giving an overall site area of 3027 sq m. The site is burdened by a right-of-carriageway (see Exhibit C4, the instrument creating the carriageway) and service easement 3 m wide along the western boundary which, when combined with the right-of-carriageway and service easement over the adjoining property at 41 Smith Street, forms a driveway access to (a) the parking area at the rear of the site, (b) the basement car parking entrance to 41 Smith Street, and ground level parking area at the rear of 41 Smith Street. The rear 40.48 m of the site also has an easement restricting the use of this area to car parking. Car parking is provided for 36 vehicles in an open car parking area at the rear of the site at two separate levels, with approximately 500 mm difference in height.

1. The existing building is set back 8.305 m from the street, a minimum of 2.5 m to the eastern boundary and 3 m to the western boundary. The front of the building at ground level contains administration, kitchen, laundry and breakfast facilities, and the rear contains the serviced apartments. The upper level contains 20 serviced apartments. The car parking area contains landscaped strips along the northern, eastern and southern boundary. At the southern boundary is a large fig tree.

1. To the east of the site, sharing a common boundary to a depth of 71 m, is 35 Smith Street, which is occupied by a two-storey older style residential flat building. To the east of the rear part of the site is the rear of 31 Smith Street which is occupied by a 3-storey townhouse building comprising part of a development known as Milford Mews. The first floor level of this building is set at a level similar to the existing parking area on the site, with the ground floor and courtyards to the west facing units set well below the parking level. The western elevation of this building contains balconies at the first floor level. Currently, landscape screening is provided on the site along the common boundary.

1. To the south of the site is a 2- storey townhouse development with access from Market Street. This development is set back a minimum of 1 m from the common boundary. To the west of the site is 41 Smith Street. It is a 5-storey (above ground level parking) residential flat building comprising two buildings, which are set back a minimum of 10.4 m from the common boundary. The east elevations of these buildings contain large balconies at each level spanning the extent of each elevation.

Some relevant background to this appeal

1. The site has the benefit of a number of DCs, which are pertinent to the claim of existing use rights.

1. On 28 May 1987, the Council granted consent for the construction of a two-storey building, with 43 motel units, and a restaurant (DA 1987/218).

1. On 13 July 1887, approval was granted by the Council to a modification to DA 1987/218, which provided for 34 serviced apartments and 36 car parking spaces.

1. On 10 March 2008, DA 2008/358 was lodged for alterations to the existing serviced apartments, including the addition of a further storey, construction of basement and grade level parking at the rear of the site, modifications to the external features and roof, associated landscaping and drainage. The DA also sought a change of use to hotel accommodation. The number of apartments and car spaces were both increased to 50, the gross floor area ("GFA") increased from 2065 sqm to 3493.12 sqm, and the floor space ratio ("FSR") increased from 0.68:1 to 1.15:1 (see Exhibit C6, tab 7, Statement of Environmental Effects ("SEE") p 14).

1. On 23 October 2009, DA 2008/358 was approved, by way of an agreement between the parties, pursuant to s 34(3)(a) of the Land and Environment Court Act1979 ("the 2008 approval" - see Presrod Pty Limited v Wollongong City Council, unreported, NSWLEC, Hussey C, 23 October 2009, Exhibit C6, tab 5).

1. On 22 July 2009, a further DA (DA 2009/867) had been lodged for the change of use of the existing serviced apartments to hotel accommodation. DA 2009/867 was refused by Council, but on 30 July 2010, DC was granted by this Court (see Presrod Pty Limited v Wollongong City Council [2010] NSWLEC 1257) ("the 2009 approval"). At par [11] of that decision, the Court noted that, under LEP 2009, hotel accommodation is a prohibited use, but, as the DA had been lodged prior to gazettal of the LEP (on 26 February 2010 - see par [14] above), it was subject to the savings provision in cl 1.8A, which states:

If a development application has been made before the commencement of this Plan in relation to land to which this Plan applies and the application has not finally been determined before that commencement, the application must be determined as if this Plan had not commenced.

1. Relevantly, as stated above (at [15]) under LEP 2007, hotel accommodation was a permissible use on the site, with DC.

1. In early January 2011, Matthew Lang installed at the drop off zone near the entry foyer at the site, two signs related to the 2009 approval (see affidavits of Chris Risto Boskovki, Matthew Lang, and Dax Eddy filed 29 May 2012).

The present application

1. On 16 September 2011, the application now before the Court was lodged with Council (see Exhibit C6, tab 7).

1. Attached to that application was a SEE, dated September 2011, prepared by JBA Planning Pty Ltd. Existing use rights were dealt with in section 5.0 of the SEE, the following parts of which are relevant:

...a previous consent (DA2009/867) was granted for the change of use of an existing serviced apartment building to hotel accommodation. An earlier consent, D2008/358, was granted for alterations and additions to the existing building as well as a change of use to hotel accommodation. Hotel accommodation is a prohibited use under the existing R1 General Residential Zone therefore this application will rely upon existing use rights.

...

The consent providing for the alterations and additions of the building (DA2008/358) also recognised the use as hotel accommodation.

1. On 27 September 2011 the Council wrote to JBA Planning, requesting that it address the following issues (Exhibit C6, tab 8, fol 1):

• The statement of environmental effects acknowledges that the subject proposal seeks internal changes to the approval granted under DA-2008/358. It further acknowledges that the proposal is not substantially the same development which is the reason for the subject application. The statement further asserts that the proposal is reliant upon existing use rights in this regard. It is unclear from the statement whether DA-2008/358 has been carried out to enable the claim for existing use rights. If the development has not been carried out, existing use rights would not exist and the proposed development would be prohibited.

In this regard you are requested to either clarify the situation and/or withdraw the application within 7 days from the date of this letter otherwise the application will be determined based on the information at hand.

1. Stephanie Ballango of JBA Planning responded to that letter on 10 October 2011 (fol 5), stating that the subject application seeks "consent for the internal reconfiguration of the floor layout, not a change of use....There is no change of use proposed". Regarding existing use rights, she noted, "that the site has been the subject of numerous DA consents", of which the 2008 approval for "alterations to the existing building and a change of use...to hotel accommodation" is the most relevant. Reference was also made to the 2009 approval for the change of use to hotel accommodation.

1. The letter went on to say that, as the site was operating as hotel accommodation, the 2008 approval "has been enacted".

1. On 25 October 2011, Terry Wetherall, Director of JBA Planning, responded to emails from Council on 19 and 25 October requesting clarification of the DC relied upon, for the change of use (fols 7, 8, 9 and 10). He confirmed that the 2009 approval was granted by this Court for the use of the site as hotel accommodation, and that "signage relating to the drop off zone was installed around the 9 November 2010. This could be considered the date of commencement for the purpose of activating the consent" (fol 10).

1. On 9 November 2011, Council wrote to the applicant in regard to the subject application, noting the proposed use was prohibited under LEP 2009, and requested further information as to which DC was relied upon for the purpose of existing use rights.

1. Based on advice from the applicant's counsel, JBA Planning responded on 9 December 2011 with the following (fol 14):

(i) the use of 39 Smith Street pursuant to DA 2009/867 is an 'existing use' as defined in S106 for the purpose of Part 4 Division 10 of the EP&A Act;

(ii) DA2011/1112 - maybe (sic) made relying upon the existing use;

(iii) even if that is wrong it is acceptable that DA 2009/867 benefits from S109B. That consent may also be amended by DA2011/1112 (and the imposition of conditions of consent, if necessary, pursuant to S80A (1) (b)).

1. On 22 December 2011, the subject application was refused by Council (Exhibit C6, tab 9) for the following reasons:

1 Pursuant to Section 79C(1)(a)(ii) of the Environmental Planning & Assessment Act 1979, the proposed development does not have regard to the provisions of Wollongong Local Environmental Plan 2009 in that:

• The proposed development is prohibited in the R1 General Residential zone;
• The proposal does not meet objective three of the R1 General Residential zone.

2. Pursuant to Section 79C(1)(e) of the Environmental Planning & Assessment Act, 1979, having regard to the above reason for refusal, the proposed development is contrary to the public interest.

1. On 15 February 2012, the applicant commenced the present proceedings.

Existing use rights?

1. As noted above (at [3]) the respondent contends that the subject application is for a prohibited use, and does not benefit from existing use rights. If the Court finds in favour of the respondent in relation to that contention, it will not be necessary to answer the merit contentions (contentions 2, 3 and 4).

1. Accordingly, it is first necessary to determine whether the development is permissible, and/or has the benefit of existing use rights.

The permissibility issues

(1) The site and existing use rights pursuant to s 106

1. Ms Duggan SC, for the respondent, understands the applicant's position to be that it (1) relies on the 2009 approval to establish existing use rights, but (2) seeks to modify the 2008 approval, through the subject application, pursuant to s 80A of the EPA Act (T p11 LL16-23).

1. Ms Duggan submits that, in order to rely on existing use rights for a DA, the applicant must satisfy the Court that an existing use, as defined in s 106 of the EPA Act, actually exists.

1. To rely on existing use rights an applicant must establish that it has commenced the use for which consent was granted (see s 106(b)(ii) of the EPA Act). Although in her written submissions Ms Duggan submitted that the use had not commenced for the purpose of s 106(b)(ii) (pars 10-12), following the filing on 20 May 2012 of affidavits from Chris Risto Boskovki, Matthew Lang, and Dax Eddy, regarding the installation of signage for the drop off zone near the entry foyer in January 2011, Council accepted that the 2009 approval had commenced, for the purpose of s 106(b)(ii), through the satisfaction of condition 3 (see T p7 LL24-29 and T p15 L23 ff).

1. Notwithstanding commencement of the 2009 approval, Ms Duggan still submits that the site does not enjoy the benefit of any existing use rights, as defined under s 106. If she is correct, and the subject application is for a prohibited use, DC cannot be granted, and the appeal must be dismissed.

1. The issue in dispute essentially comes down to the interpretation of s 106(b)(i) of the EPA Act and its interaction with the LEP, especially cl 1.8A (see [26] above). The question is, therefore, whether the provision having the effect of prohibiting the use under LEP 2009 is found to have commenced before or after the grant of the 2009 approval.

The respondent's case

1. Ms Duggan submits that the LEP is to be construed as a whole, in a way that best accords with its object and purpose, and with an assumption that all words ought to be given their preferred meaning (respondent's submissions, par 19).

1. Ms Duggan argues that there can be no dispute when LEP 2009 commenced. Acknowledging that there is power to specify different commencement dates for different parts of the LEP (see s 25 of the Interpretation Act 1987), Ms Duggan submits that cl 1.1AA of LEP 2009 did not take advantage of that power (Tp16 L5 ff). Pursuant to cl 1.1AA, the LEP was clear and unequivocal that all provisions of LEP 2009 were to commence on 26 February 2010, its date of publication on the NSW legislation website (see [14] above). This pre-dates the date of the grant of consent (30 July 2010).

1. Ms Duggan submits that reliance on the savings provision (cl 1.8A) cannot be justified for a number of reasons. First, the LEP must have commenced in its entirety for the savings provisions to become operational. Second, the savings provision saves the DA, but does not "suspend" commencement of the prohibition. Third, the words in the savings provision operate to "pretend" that there has not been commencement of plans for the single object of the EPA Act permitting DAs to be determined; it does not affect the commencement or operation of LEP 2009. Fourth, the use is prohibited, and the fact that another clause permits the development to be approved does not remove the prohibition. Fifth, the savings provision is merely a facultative provision, which permits the consent authority, in certain circumstances, to relax the prohibition, without the prohibition being removed (respondent's subs, pars 24-28. See also Tp 18 L50ff).

1. Ms Duggan submits that the construction relied upon by the applicant is also inconsistent with the proper construction of s 106, in that it directs an inquiry to the commencement of the particular environmental planning instrument as a whole. It is not directed to the manner in which such an instrument is applied to a particular DA.

1. Accordingly, the whole of LEP 2009 properly construed, commenced on 26 February 2010. The 2009 approval was, therefore, not granted before the commencement of the provision that prohibited the DA, but was granted by force of the savings provision in the 2009 LEP. The site does not, therefore, benefit from existing use rights pursuant to s 106(b) (T p20 L30).

The applicant's case

1. Mr Hemmings put to the Court that the applicant's approach relies on existing use rights, but also takes the benefit of the 2008 approval, and seeks to amend that DC by a later DC (T p12 LL45-48). There is no doubt that LEP 2009 prohibits the proposed use, but he submits that the savings provision (cl 1.8A) has the effect that, until the 2009 approval was finally determined, the application was to be determined as if LEP 2009 had not yet commenced (see applicant's memorandum of advice, par 19).

1. Clause 1.8A permitted the DA to be determined, and approval granted, and immediately upon the granting of that consent, it ceased to have effect. Consequently, upon final determination of the 2009 approval, LEP 2009 "commenced" for the purpose of that DA, and it was only upon that commencement, that a provision of the LEP 2009 first had the effect of prohibiting the use.

1. Mr Hemmings submits that DA 2009/867 was capable of approval "because there was not something which had the effect of prohibiting that use as at 30 July 2010" (T p27 L31). Therefore, although the LEP commenced on 26 February 2010 (cl 1.1AA), the relevant date for the purpose of the subject application, and s 106, is 30 July 2010 (applicant's reply submissions, par 5). Understood in that way, LEP 2009 is taken to have commenced following the 2009 approval (reply subs, par 9).

1. In support of his interpretation, Mr Hemmings submits that existing use provisions are "designed to preserve and protect existing rights. They ought to be liberally construed", and should "not be restricted by dubious implications drawn from words used in other clauses directed to a different subject matter" (Parramatta City Council v Brickworks Limited (1972) 128 CLR 1, at 25, and Dorrestijn v South Australia Planning Commission [1984] HCA 76; (1984) 54 LGRA 99, at [105]). The Court should, therefore, approach the chronological requirements of s 106(b)(i) in accordance with that liberal interpretation.

1. Mr Hemmings draws attention to differences in the express terms of s 106(a), which focuses upon "the commencement of an environmental planning instrument", compared with those of s 106(b), which directs attention to "provisions of the instrument", having the effect of prohibiting the use. Section 106(b) is, therefore, concerned with the use for which consent was granted.

1. Mr Hemmings argues that, as the 2009 approval was acted upon within one year of its grant (see above at [28] and [43]), the use commenced for the purposes of s 106(b)(ii), and the whole of the site, therefore, has the benefit of existing use rights.

1. As a result of those existing use rights, a new DA can be lodged to expand, intensify or alter those rights. However, rather than taking that course, the applicant submits that the subject application has the effect of modifying its earlier DC. As authority for this, Mr Hemmings refers the Court to s 80A of the EPA Act, Gordon & Valich Pty Ltd v City of Sydney Council [2007] NSWLEC 780 ("Gordon & Valich"), at [17], and Waverley Council v CM Hairis Architects [2002] NSWLEC 180; (2002) 123 LGERA 100 ("Hairis Architects") (reply subs, par 19).

1. Mr Hemmings submits that the Court had already considered the merits issues pertaining to the three-storey hotel in the 2008 approval, and the subject application merely modifies that DC by providing for dual key apartments and converting some of the two bedroom apartments to one bedroom (rely subs, par 20).

Finding on s 106

1. An existing use as defined, in s 106 of the EPA Act, is a use that is lawfully commenced, but which subsequently becomes prohibited as a result of the introduction of a new environmental planning instrument.

1. In this case, it is not in dispute that, as a result of the 2009 approval, the site has the benefit of DC, which is both valid and continuing, for use as hotel accommodation, notwithstanding the fact that such is now a prohibited use under LEP 2009.

1. It is also agreed that, although the 2009 approval was granted (30 July 2010) after the date that LEP 2009 came into effect (26 February 2010) for a use that is prohibited in that LEP, cl 1.8A meant that, as it was lodged with Council before 26 February 2010, it could be determined as though the later plan had not commenced.

1. The major difference between the parties essentially comes down to the impact, if any, that cl 1.8A had upon the commencement of the LEP, and whether it can be relied upon, as the applicant contends, to effectively defer commencement of the LEP, so that the terms of s 106 are satisfied.

1. The Court is of the opinion that there is nothing in LEP 2009 that indicates a commencement date for some provisions, which is different to that for others. Clause 1.8A does not operate to alter the timing of the commencement of the LEP or the provisions within it, but it allows an application lodged within a certain time frame to be determined under an earlier instrument.

1. The Court notes the difference, in their express terms, between s 106(a) and s 106(b), but the interpretation given to those differences by the applicant cannot be accepted.

1. A DC granted before the commencement of an environmental planning instrument (or a specific provision within it) falls within the definition of existing use in s 106, but that is different from a situation where a DA is lodged before commencement of the relevant instrument, but not determined until after it has commenced.

1. Accordingly, the provision prohibiting the subject use commenced on 26 February 2010, pursuant to cl 1.1AA of LEP 2009, and it was not deferred for the purpose of the 2009 approval, as a result of cl 1.8A.

1. The site does not, therefore, have existing use rights under s 106(b) of the EPA Act, emanating from the 2009 approval.

(2) The subject application, the 2009 approval, and s 109B

1. Ms Duggan accepts that, although the site does not enjoy existing use rights, both the 2008 and 2009 approvals continue, and can be modified "in accordance with the Act", pursuant to s 109B(2)(b) (see T p20 L44).

1. However, as the use to which the DC relates is prohibited, it can only be modified by way of a modification application, pursuant to s 96 of the EPA Act - an avenue that the applicant cannot pursue, and has not pursued, due to the "jurisdictional limitations" requiring the development to be substantially the same as that originally approved (respondent's submissions, par 34).

1. Ms Duggan submits that, although, pursuant to s 80A, a later DC can impose conditions modifying the terms of another DC, that section does not operate to authorise the making of a DA, but can be exercised only on a validly made DA. Further, in referring to the division of the Act dealing with existing use, s 80A(1)(b) merely acknowledges that where a DC can be granted, a condition can be imposed on the DC, which operates to modify the existing use (subs, par 43).

1. Ms Duggan submits that Part 4 Div 2 of the EPA Act, which authorises the making, consideration and determination of DAs, does not apply to prohibited developments (see ss 76A, 76B, and 77). Therefore, in the absence of existing use rights, the consent authority cannot approve the subject application, and "the exercise of the power to impose a condition never arises" (subs, par 36).

1. Ms Duggan contends, therefore, that, as the 2009 approval does not confer existing use rights upon the site, and the subject application is for a prohibited use, it must be refused.

1. Notwithstanding the applicant's principal position that the site has existing use rights, Mr Hemmings submits that s 109B, which forms "part of the suite of controls designed to protect existing uses" (applicant's reply subs, par 21), also provides the opportunity for the approval of the subject application.

1. Mr Hemmings submits that the site and/or the development can benefit from both a s 106 existing use, and a s 109B continuing use, and relies upon Currency Corp Pty Ltd v Wyong Shire Council [2006] NSWLEC 692; (2006) 155 LGERA 230 and Reading Properties Pty Ltd v Auburn Council [2007] NSWLEC 186; (2007) 158 LGERA 116 ("Reading Properties") at [36] (but c.f Pain J's comments in Caltex Australia Petroleum Pty Ltd v Manly Council [2007] NSWLEC 105; (2007) 155 LGERA 255).

1. Mr Hemmings argues, however, that if s 106 existing use rights are found to exist, the Court need not concern itself with s 109B, and he, therefore, confines his submissions on s 109B to the separate question of the power to modify a s 109B DC, for which there are no s 106 existing use rights (Tp 29 L 46 ff).

1. Section 109B(2)(b) makes it clear that a DC, although for a now prohibited use, may continue and may be modified in accordance with the EPA Act. Although Mr Hemmings acknowledges that the present application is subject to the same controls as any other DA, he submits that, in this case, those controls are now to be applied in relation to a use, which is prohibited (reply subs, par 22), and that it is, as a result of that distinction, that the prohibited use may be modified in accordance with the Act.

1. Mr Hemmings argues that the respondent's interpretation is unnecessarily and inappropriately restrictive, and he provided the Court with examples illustrating the impractical operation of the section, if the respondent's interpretation is adopted (reply subs, par 25, and see also Tp 31 LL32-43). He, therefore, submits that the preferred view should be that the prohibited use may continue, and be modified, by way of a further DA.

1. Mr Hemmings submits that s 96 of the EPA Act is not the only means by which the DC may be modified, and that s 80A(1)(b) is as much a part of the legislative scheme as s 96. He also argues that there can be no doubt that s 80A is available to a DA which relies on s 109B (see Wingecarribee Shire Council v Pancho Properties Pty Ltd [2001] NSWCA 271; (2001) 117 LGERA 104 ("Pancho Properties")). He did acknowledge that there are limitations on the use of s 80A (see Gordon & Valich), but he noted Talbot J's consideration in Hairis Architects of the ability to use s 80A to modify an existing consent.

1. In Gordon & Valich (at [15] ff), Preston ChJ, when dealing with an application to amend an existing DC, stated the following:

15 At the outset, it should be noted that the development application is inaccurate in its description of the development. I have said, the application sought to amend the existing development consent in certain ways. Under the Environmental Planning and Assessment Act 1979, a development application can only be made seeking consent for the carrying out of development: s 78A(1).

16 "Development" is a defined term: see s 4(1). It includes the use of land, the subdivision of land, the erection of a building, the carrying out of a work, and the demolition of a building or work. A development consent may be granted authorising the carrying out of development of one or more of these types. A development consent, however, is not itself development. The Environmental Planning and Assessment Act does not permit the lodging of a development application to amend a development consent, rather only to carry out development of one or more of the types falling within the definition of development (see s 78A(2)).

17 Of course, if development consent is granted for the carrying out of development as defined, a condition of consent for that development may be able to be imposed requiring the modification or surrender of an earlier development consent: see s 80(1)(b) and (5). It may also be that even without a formal condition requiring modification, the grant of and the carrying out in accordance with another development consent may have such a consequence. In either case, this might be a consequence but it would not be the purpose of the development consent.

1. In Hairis Architects, Talbot J found that there was no "statutory constraint" limiting the type of development that could be the subject of a DA. His Honour was also of the opinion that there was no distinction between the statutory scheme for the making of DAs, pursuant to the EPA Act (i.e. consent for the alteration of a building), and the granting of conditional consent as contemplated by s 80A (i.e. consent for the alteration of a right arising from an earlier DC). His Honour said (at [28]):

The express provision in s80A for the grant of a conditional consent supports the expectation that an application for consent ultimately found to be dependent upon the exercise of that power can be a valid exercise.

1. In his oral submissions, Mr Hemmings noted that the applicant was not relying on either s 96 or s 80A to modify the earlier DC, but submits that the power to modify, pursuant to a new DA, can be found in s 109B (see T p33 L9 ff). He then went on to say (at T p 33, LL37-45):

... the approach the applicant adopts is here is a new consent the effect of which is to modify the 2008 358 consent, the three storey consent. And so as a matter of - if the Court's otherwise satisfied, what do we approve, the Court simply approves the set of plans now before the Court. Those plans now before the Court have the effect of, implicitly, modifying 2008 358 and the assessment that the Court needs to undertake for the purposes of the application are limited to the intensification of the use because the underlying use has already been assessed and approved as part of 2008 358 consent.

1. Mr Hemmings submits that subject to the merits considerations, DC may, therefore, be granted to the subject application.

Finding on s 109B

1. Although s 109B is a savings provision that sits within the "existing uses" division (Part 4 Div 10) of the EPA Act, and should, therefore, be given a broad interpretation, there is nothing in that section which provides a consent authority with power to grant DC.

1. The Court cannot disregard that fact, and it is also relevant that the legislature proposed a different set of rights and controls for existing uses, as opposed to continuing uses.

1. The Court is, therefore, of the opinion that it should reject the applicant's submission that 109B specifically provides for the making of a DA which is for a prohibited use.

1. Accordingly, as the subject application is for a prohibited use, it is not development to which Part 4 Div 2 applies, and in the absence of existing use rights, there is no power within the EPA Act to grant consent.

The merits of the subject application

1. As the Court has found in favour of the respondent in relation to Contention 1, the question of the amenity impacts need not be answered. However, for the sake of completeness, and in case the above is found to be wrong, the Court's findings on contentions 2, 3 and 4 will now be briefly outlined.

1. Residents raised a series of concerns, such as the additional level in DA 2008/358, the previous approval processes for site, and alleged non-compliance with conditions of consent, but these cannot be addressed as part of assessing this present application - these Class 1 proceedings do not provide any opportunity for judicial review of past decisions, nor for any reconsideration of Commissioner Brown's reasons on the earlier occasion.

1. The witness Brown opined that addition of a further 11 units will increase traffic movements, and affect issues associated with the reception area being within the shared driveway, but Mr Wetherall noted that conditions of consent under previous approval DA 2009/867 have specific requirements regarding the operation of the right of carriageway (condition 3), and the behaviour of occupants, through a plan of management (conditions 31 and 32). Importantly, Mr Wetherall noted that the Traffic and Parking Assessment prepared by McLaren Traffic Engineering for the current DA calculates that the additional 11 units will generate only an additional 1 to 2 trips per hour, a very small impact.

1. Loss of privacy and noise impact were seen by Mr Brown to result from the additional people likely to be attracted to the development by the reconfiguration, and the unavailability of additional rooms, but Mr Wetherall relied again on the plan of management to ensure that there will not be any unacceptable amenity impacts on adjoining residential properties.

1. The Court is satisfied that any increase in traffic and any increased amenity impacts brought about by the reconfiguration and the additional rooms would not warrant the refusal of the application for a number of reasons. It cannot be disputed that the additional traffic generated by the proposed development is "insignificant", and would be "readily absorbed by the surrounding road network"; the amount of parking on site "exceeds Council's requirements"; and there are conditions in force to address patron behaviour.

Conclusion and Orders

1. As the subject application is for a prohibited use under LEP 2009, the applicant's appeal under s 97 of the EPA Act must fail.

1. The formal orders of the Court are:

(1) The applicant's appeal under s 97 of the Environmental Planning and Assessment Act 1979, against the respondent's refusal to grant approval to DA 2011/112 is dismissed.

(2)   Costs are reserved.

(3)   All exhibits are returned to the parties.

Decision last updated: 29 October 2012