Pro-Star v Petroleum Prods Retail Outlet BD & Ors No. Scgrg-98-261 Judgment No. S6904

[1998] SASC 6904

PRO-STAR SERVICE STATION PTY LTD
v PETROLEUM PRODUCTS RETAIL OUTLETS BOARD,
CITY OF SALISBURY and MOBIL OIL AUSTRALIA LIMITED
[1998] SASC 6904

Full Court:  Millhouse, Olsson and Debelle JJ

1. MILLHOUSE J.   I agree with the reasons of Debelle J.

2. OLSSON J.          I agree with the reasons expressed by Debelle J.

3. DEBELLE J.      On 9 October, the Court allowed this appeal and said it would publish its reasons.  These are the reasons for that decision.

4. This is an appeal from a judge of this Court dismissing an application for judicial review.  The issue is whether a grant of development consent is valid.  That issue, in turn, depends upon whether the council who granted the development consent complied with the procedures prescribed by the Development Act 1993 and the Development Regulations 1993 made thereunder. The answer to that question turns on the nature of the proposed development and the category assigned to the development by the relevant Development Plan or the Development Regulations.

A Development Application

1. On 25 November 1997 Mobil Oil Australia Limited (“Mobil”) applied to The Corporation of the City of Salisbury (“the Council”) for provisional Development Plan consent for what Mobil described in its application as a “petrol filling station and shop”.  The land which Mobil proposed to develop is at the junction of Globe Derby Drive and Port Wakefield Road, Bolivar.  The land is within the area of the Council and forms part of a Recreational Zone as prescribed by the Council’s Development Plan.

2. The appellant operates a Caltex service station on Port Wakefield Road, Bolivar about three kilometres north of the subject land.  The appellant did not receive notice of Mobil’s application and, therefore, was not able to lodge a representation in relation to the development application pursuant to the Planning Act.

3. On 12 February 1998 the Council granted provisional Development Plan consent to the application.  For convenience, I will hereafter refer to provisional Development Plan consent as “development consent”.  The appellant says that the Council was required by the Development Act to give it notice of the application and to allow it to be heard in opposition to the application.  It adds that the failure to comply with the Development Act and the Development Regulations rendered the development consent invalid. The appellant applied for an order in the nature of certiorari to quash the grant of development consent.  Its application was dismissed.  It is that application which is the subject of this appeal.

An Application to Retail Petrol

1. Before lodging its application for development consent, Mobil had, on 18 December 1997, applied to the Petrol Products Retail Outlets Board (“the Board”) for an annual licence to sell motor fuel by retail from the proposed petrol filling station.  That application was made pursuant to the Petrol Products Regulation Act 1995.  The Board listed the application for hearing on 27 February 1998.  It is the Board’s policy not to hear an application unless and until planning approval has been obtained in respect of the premises the subject of the application.  On 25 February 1998 the appellant’s solicitor wrote to the Board, reminding it of its policy, and informing it that it believed that the development consent issued to Mobil by the Council was invalid.  It asked the Board to desist from hearing the application until the validity of the consent had been determined by this Court.  The Board replied by letter dated 25 February 1998 that it would not accede to that request.  On 27 February 1998 the appellant applied to this Court for an order in the nature of prohibition to prevent the Board from hearing and determining the application. The application was dismissed.  The Board heard the application and granted the annual licence.  There is no appeal from the dismissal of the application for prohibition.  Plainly, Mobil will not be able to take advantage of its annual licence unless and until it obtains a grant of development consent.

The Categories of Development

1. The entitlement of a person to make representations to a planning authority in respect of a development application and, thereafter, the right to be heard by the planning authority and even appeal against the grant of development consent is prescribed by the Development Act and the Development Regulations.  The scheme provided by the legislation creates three categories of development.  They are designated Categories 1, 2 and 3. The question whether a person is entitled to notice of a development application and to make representations to the relevant planning authority turns on the category into which the intended development falls.  Similarly, the question whether a person is entitled to appeal against the decision to the Environment Resources & Development Court turns on the category into which the development falls. 

2. Section 38(1) of the Act establishes the above three categories. The statutory provisions which assign intended development to Categories 1 or 2 are the Development Regulations and the Development Plan: s38(2)(a) of the Act. Any development which is not assigned a category is deemed to be a Category 3 development: s38(2)(b).

3. In the case of those developments which are within Category 1, the Act does not require that notice be given of the development application and there is no right to make representations to the planning authority or to appeal from the planning authority’s decision: s38(3).  There is, however, nothing to prevent a planning authority from giving notice and hearing any representation.

4. In the case of those developments which are within Category 2, the planning authority must give notice of the development application to

   (a)     the owner or occupier of each parcel of adjacent land; and

   (b)     any other person of a prescribed class: s38(4).

A person who receives notice of a Category 2 development is entitled to make representations to the relevant planning authority concerning the proposed development: s38(7).  The planning authority has a discretion whether to allow the representor to be heard in support of the representation: s38(10)(a). 

1. In the case of those developments which are within Category 3, the planning authority must give notice of the application to

   (a)     an owner or occupier of each piece of adjacent land;

   (b)     any other person of a prescribed class;

   (c).... any other owner or occupier of land which, according to the determination of the planning authority, would be directly affected to a significant degree by the development if it were to proceed; and

   (d).... the public generally: s38(5).

Any person in those groups has the right to make a representation to the planning authority in respect of the proposed development: s38(7), and the authority is obliged to hear any representor who wishes to be heard in support of the representation: s38(10)(b).  Persons who have been given notice of a Category 3 development and who have lodged a representation are entitled to appeal to the Environment Resources & Development Court against a decision granting development consent to the application: s38(12). 

1. The issue in this case is whether the development proposed by Mobil was for a Category 1 development.  If it is, the Council has acted in accordance with the procedures under the Development Act and Development Regulations.  It is common ground that, if the proposed development does not fall within Category 1, it is a Category 3 development.  In that case, the Council has failed to act in accordance with the correct procedures under the Act and Regulations and has seriously curtailed the rights of the appellant to make representations to be heard.  It is, therefore, necessary to examine more closely the nature of the proposed development and determine the category to which it should be assigned.

The Proposed Development

1. Although Mobil’s application described the proposed development as a petrol filling station and shop, the plans which accompanied the application depicted a different kind of development.  Mobil proposed to construct a building which contained

   (i).... a petrol filling station with an associated shop of the kind which is commonly called “a convenience store”;

   (ii)... a McDonald’s fast food store with a facility to serve cars in a driveway; and

   (iii).. a common area, described as a “common tenancy” which contained public lavatories and other facilities to be shared by Mobil and the McDonald’s outlet.

The building was one large complex.  For reasons which appear below, it is necessary to note the area of the constituent parts of the building.  Those areas were:

The Mobil office and convenience store                115 square metres
         McDonald’s outlet  184 square metres
         Common tenancy   72 square metres
         TOTAL  371 square metres

Parking spaces were provided for 34 cars, 3 semi-trailers and one bus.

Which Category?

1. The determination of the category to which the development should be assigned turns on the provisions of the Development Plan for the Council area so far as they relate to the Recreation Zone in which the development is to be situated.  The Plan lists Principles of Development Control for the Zone.  Principle 13 of this Recreation Zone provided:

   “The following kinds of development are listed as Category 1 in the Recreation Zone:

   Petrol filling station incorporating a shop having a gross leasable floor area not exceeding 300 square metres with Allotment 23FP114584.”

The site of Mobil’s development is Allotment 23FP114584. However, there are at least two grounds on which this proposal is not the kind of development described in Principle 13.

1. The first is that the proposal is not for a “petrol filling station” as defined. Schedule 1 of the Development Regulations lists a series of definitions of terms used in the Development Plan and the Regulations.  It defines a petrol filling station in these terms:

   “‘petrol filling station’ means land used for the purposes of fuelling and servicing motor vehicles (including the sale of goods where the area used for the sale of goods is not greater than 50 square metres), but does not include a motor repair station.”

It is common ground that the area of the Mobil office and convenience store is 115 square metres.  The area devoted to the sale of convenience goods is 85 square metres.  The sales area, be it 115 square metres or 85 square metres, exceeds the area permitted by the definition.  The application is, therefore, not in respect of a petrol filling station.  As such, it does not satisfy the description in Principle 13 and is not a Category 1 development.

1. The second ground is that the proposal is for a complex which goes beyond the kind of development described in Principle 13.  It is more than a petrol filling station incorporating a shop whose floor area does not exceed 300 square metres. The plans show a petrol filling station and convenience store to which are attached other premises, namely, the McDonald’s outlet.  For reasons which appear later, the McDonald’s outlet is a shop.  The proposal is, therefore, for a petrol filling station and convenience shop attached to which is another shop.  In order to qualify as a Category 1 development, the premises had to comprise only a petrol filling station and one shop.  As this proposal is for a petrol filling station and, in effect, two shops, it does not satisfy the requirements of Principle 13.  There are two uses which are independent of one another.  One is the petrol filling station-cum-convenience store and the other is the McDonald’s outlet, be it a restaurant or shop.  Neither is subservient to the other and regard must be had to both land uses when determining whether the proposal falls within the description in Principle 13: Southern Cross Homes Inc v Enfield City Corporation (1992) 76 LGERA 94.

2. This is not a case where it is possible to apply s26 of the Acts Interpretation Act 1915 so that the word “shop” is to be construed in the plural. First, the operation of s26 is confined to Acts of Parliament and so does not extend to statutory instruments such as the Development Plan. Secondly, the clear intention of Principle 13 is to define a petrol filling station properly so called and one shop.

3. For these two reasons, the proposed premises are not of the kind described by Principle 13.  It is not, therefore, a Category 1 development. 

Is McDonald’s a Restaurant?

1. The appellant sought to reinforce its argument by contending that the McDonald’s outlet was a restaurant. A restaurant is defined by Schedule 1 of the Development Regulations in these terms:

   “‘restaurant’ means land used primarily for the consumption of meals on the site.”

The evidence was that the outlet would be used to provide food for consumption both on or off the premises.  There was an issue whether the outlet would be primarily used for the consumption of meals on the site.  The Council had before it a letter from McDonald’s Australia Limited stating that it anticipated that sales of food for consumption off the premises would constitute more than half of the business.  That estimate was based on the fact that the premises were located on a major arterial road from Adelaide to major centres and was part of an interstate highway to Alice Springs and Perth.  That estimate must be weighed with the fact that the plans depict an area for consumption of meals in the premises established with tables and chairs.  In addition, car parking space is provided for 34 cars.  It is clearly intended that those spaces will be used by patrons of the restaurant as well as patrons of the convenience store.  Thus, it is difficult to determine whether the premises will be used primarily for the consumption of meals on the site.  However, given the definition of “shop” in the Development Regulations, I do not think it is necessary to determine that question.  The relevant part of the definition states:

“‘Shop’ means -

(a)     premises used primarily for the sale by retail, rental or display
         of goods, foodstuffs, merchandise or materials; or

(b)     a restaurant; or

(c)     a retail showroom; or

(d)     a personal service establishment”.

The McDonald’s outlet will sell only foodstuffs for consumption both on and off the premises.  It is, therefore, a shop as defined in paragraph (a). In addition, the definition of “shop” includes a restaurant.  There is, therefore, little point in seeking to determine whether the premises are a restaurant as defined.

1. Furthermore, whatever be the true nature of the McDonald’s outlet, be it a shop or a restaurant, the proposal does not satisfy Principle 13 since it is either for a petrol filling station, convenience store and shop or for a petrol filling station convenience store and restaurant.

2. For all of these reasons, the proposed development is not a development of the kind described in Principle 13 and is not a Category 1 development.  There is no other ground upon which it can be classified as a Category 1 development.  As already mentioned, it is common ground that, unless the proposal is for  a Category 1 development, it is a Category 3 development.  The proposal is, therefore a Category 3 development and the appellant was entitled to notice of the application, to lodge a representation, and to be heard in support of the representation.  If the Council approved the development, the appellant had a right to appeal to the Environment Resources & Development Court.  The Council has failed to act in accordance with the procedures prescribed in the Development Act and the Development Regulations for giving notice of a Category 3 development.  The failure to comply with those procedures has so substantially interfered with the rights of the appellant that the Court has no alternative but to set aside the development consent.  The appeal must, therefore, be allowed.

A New Ground

1. The grounds on which the appellant has succeeded were not argued before the trial judge.  The respondent submitted that there were reasons why the appellant should not be permitted to advance them in this court.  The first was that the appellant should be bound by its conduct of the application in the court below.  The second was that the appellant was barred by the terms of Rule 98.

2. It is well settled that a party is bound by the conduct of the case in the court below and that he will be permitted on appeal to raise an argument not advanced in the court below only where all the facts have been established beyond controversy or where the point is one of construction or of law: Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; O’Brien v Komesaroff (1982) 150 CLR 310 at 319; University of Wollongong v Metwally [No2] (1985) 59 ALJR 481 at 483; Coulton v Holcombe (1986) 162 CLR 1 at 7-8 and Water Board v Moustakas (1988) 180 CLR 491 at 497. See also Green v Sommerville (1979) 141 CLR 594 at 607-608; Paltara Pty Ltd v Dempster (1991) 6 WAR 85 at 89; Banque Commerciale SA (in liquidation) v Akhil Holdings Ltd (1990) 169 CLR 279 at 284 and Tyson v Brisbane Market Freight Brokers Pty Ltd (1994) 120 ALR 1 at 9. With respect, Cox J stated the position too absolutely in Zurich Australian Insurance Ltd v Wood (1997) 69 SASR 572 at 578 when he said:

   “The general rule is that a party is bound by the conduct of his case at trial, and it is only in the most exceptional circumstances that he will be allowed on appeal to raise an argument which, deliberately or inadvertently, he failed to put during the hearing...”

I respectfully suggest that the principle is better expressed by substituting the words “limited circumstances” for “the most exceptional circumstances”. 

1. The issues in this appeal turn on the proper construction of the Development Plan and the Development Regulations.  The evidence is in narrow compass and is agreed.  There are no nice issues of fact which must be determined. There is no challenge to the findings of fact in the court below. This is, therefore, one of those cases where it is not only competent but in the interests of justice to permit the fresh points to be argued.

2. Secondly, I do not think that in the particular circumstances of this case the terms of Rule 98 require a different conclusion.  Rule 98.04 requires an applicant for judicial review to state in an affidavit the grounds on which he relies.  Rule 98.08 then provides:

   “Subject to paragraph (2) hereof no grounds may be relied upon, or any relief sought, at the hearing except the grounds and relief set out in the affidavit in support of the summons for leave to serve.”

Paragraph (2) of the rule permits an applicant to amend his affidavit by leave. In this case, the first affidavit filed in support of the application asserted that the proposal was not for a Category 1 development because the McDonald’s outlet was a restaurant.  The appellant then informed the respondent by letter that it wished to raise an additional point, namely, that the Council had erred in treating the application as an application for a petrol filling station as defined in the Development Regulations and asserted that the proposal was for a Category 3 development.  The appellant confirmed that it was relying on that ground by an affidavit filed on its behalf which was filed at least one month before the application was heard.  The second affidavit was admitted. Thus, the ground that the proposal was not for a petrol filling station as defined was argued before the trial judge.  However, the arguments then advanced did not include those which were submitted to this Court.  Nevertheless, the appellant has clearly stated that one of the grounds on which it relies is that the proposal is not a petrol filling station.  The submissions made to this Court were alternative arguments justifying that conclusion.  If it were necessary to categorise them, they could be categorised as the particulars of the ground relied on.  Rule 98.08 does not, therefore, operate in the circumstances of this case. For these reasons, the Court permitted the fresh arguments to be advanced.

1. There is an interesting question whether the terms of Rule 98.08 preclude the operation of the principles established in Suttor v Gundowda Pty Ltd (supra) and the cases which have applied that decision.  In the particular circumstances of this case, the question need not be determined.

2. There remains, however, one question for consideration, namely, whether the fact that an applicant who has failed in the court below and who succeeds on appeal on grounds not advanced in the court below should be entitled to its costs.  The court has decided that it will hear the parties on this question.

3. This case is a salutary reminder to those advising applicants for judicial review carefully to identify and state the grounds upon which the applicant relies.

Conclusion

1. For these reasons, the Court made the following orders:

2. Appeal allowed.

1. Order in the nature of certiorari quashing the decision of the second respondent made on 12 February 1998 granting provisional Development Plan consent to the third respondent in respect of the Development Application No 361/02205/97/C1.

1. Question of costs reserved.

The Court will hear the parties on the appropriate orders as to the costs of the appeal and the costs in the court below.