Staldone Corporation Pty Ltd v Lane Cove Council

[2016] NSWLEC 1261

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Staldone Corporation Pty Ltd v Lane Cove Council [2016] NSWLEC 1261
Hearing dates:	3 March 2016
Date of orders:	05 July 2016
Decision date:	24 June 2016
Jurisdiction:	Class 1
Before:	Pearson C
Decision:	See paragraph [62]
Catchwords:	DEVELOPMENT MODIFICATION: Residential flat building – Waste management – Stormwater and drainage – Compliance with approved plans – s94 Contributions – Footpath and kerb and guttering
Legislation Cited:	Environmental Planning and Assessment Act 1979 Environmental Planning and Assessment Regulation 2000 Lane Cove Local Environmental Plan 2009
Cases Cited:	Botany Bay City Council v Saab Corporation Pty Limited [2011] NSWCA 308 Burwood Council v Ralan Burwood Pty Ltd (No 3) [2014] NSWCA 404 Cavasinni Constructions Pty Ltd v Fairfield City Council [2010] NSWLEC 65 Dogild Pty Ltd v Warringah Council (2008) 158 LGERA 429 Eggleton v Manly Council [2014] NSWLEC 1010 Newbury District Council v Secretary of State for the Environment [1981] AC 578 North Sydney Council v Michael Standley & Associates Pty Ltd (1998) 43 NSWLR 468 SDHA Pty Ltd v Waverley Council [2015] NSWLEC 65
Category:	Principal judgment
Parties:	Staldone Corporation Pty Ltd (Applicant) Lane Cove Council (Respondent)
Representation:	Counsel: Mr M Staunton (Applicant)   Solicitors: Mr S Simington, Lindsay Taylor Lawyers (Applicant) Mr A Seton, Marsdens Law Group (Respondent)
File Number(s):	2016/00166916 (Formerly 10929 of 2015)
Publication restriction:	No

Judgment

1. This is an appeal pursuant to s 97AA of the Environmental Planning and Assessment Act 1979 (the Act) against the deemed refusal of an application under s 96(2) of the Act to modify Development Consent D202/14 granted by the respondent Council on 28 May 2015 for the demolition of existing dwellings and construction of a residential flat building comprising 52 units and parking for 85 cars at 5-7 Mindarie Street and 594-596 Mowbray Road Lane Cove North (the site).

2. The modifications proposed to the floor plans include removal of the approved garbage chute waste management system and consequent deletion of garbage room A on the basement level and increase in the size of garbage room B, and deletion of garbage rooms on the ground floor, upper ground floor, first floor, second floor and third floor; reconfiguration of units on each floor; alteration of units UG.05 and UG.06 from one and three bedroom units respectively to two bedroom units; minor adjustments to wall alignments on the first and second floors; repositioning of living room glass and reduction of balcony of unit UG.08 on the upper ground floor; and repositioning of the mechanical riser on the roof.

3. The internal modifications would change the dwelling mix:

Approved                            Modified

21 x 1 bedroom (40%)         20 x 1 bedroom (38%)

26 x 2 bedroom (50%)         28 x 2 bedroom (54%)

5 x 3 bedroom (10%)           4 x 3 bedroom (8%)

4. The application sought modification of the following conditions:

1. Condition 1: delete the word “strictly” from the requirement that “the development be strictly in accordance with the following drawing numbers:”;

2. Condition 2: requiring submission of Construction Noise Management Plan before issue of a Construction Certificate (CC);

3. Condition 11: s94 contributions should be in the amount of $693,813.20 at the rate of $9,636 per person as at the date of consent, and not $726,340.00;

4. Condition 37: amend plans prior to issue of CC to add 3sqm of area to living room of UG.08 by moving the living room glazing wall;

5. Condition 58: stormwater design plan changes;

6. Condition 59: drainage plan amendments; and

7. Condition 69: construction and reconstruction of a new 1.5m wide footpath adjacent to the frontage of Mowbray Road and Mindarie Street, with new kerb and gutter, and $10,000 cash bond or bank guarantee.

Issues

5. In its Statement of Facts and Contentions (ex 1) the Council contended that the modification application should be refused on the following grounds:

1. The proposed modified development, by incorporating the approved garbage rooms into storage areas or into the dwellings, would not comply with the development standard for maximum FSR;

2. The inclusion of the word “strictly” in condition 1 is necessary and reasonable;

3. The correct credit should be applied to the s 94 contributions calculations, so that the total contribution is $738,845.60;

4. The proposed modified development would not comply with the objectives of Part C.3 in cl 3.1 or the controls for the mix of dwellings in cl 3.10 of the Lane Cove Development Control Plan 2010, which specify that at least 10% of each unit type of 1, 2 and 3 bedrooms should be provided;

5. The proposed modification to condition 58 will result in a development that is inconsistent with and does not comply with Part O.4 of the DCP in terms of disposal of stormwater;

6. The amendments for condition 59 are not acceptable because the amendments to condition 58 are not acceptable;

7. The waste management arrangements for the proposed modified development are unacceptable and inconsistent with the purposes and controls in Part Q of the DCP, and a garbage chute system is required for the development;

8. The proposed amendment to condition 69 is unacceptable: each of the three street frontages should be adequately serviced, and the provision of new kerb and gutter and a new footpath is necessary and reasonable; and

9. Approval of the application is not in the public interest having regard to the contentions raised.

6. As a consequence of the conferencing of the parties’ waste management, and stormwater and drainage experts, agreement was reached on appropriate amendments to conditions 58 and 59, and on the amendments to the waste management system including the proposed removal of the garbage chutes. Those contentions were not pressed. The Council did not press the contention relating to the change in unit mix. The Council agreed to the deletion of condition 2, requiring provision of a Construction Noise Management Plan prior to the issue of a CC: that plan has been provided (ex B, Appendix E). The Council also agreed to the deletion of condition 37, as the design change required by that condition is now incorporated in the s96 plans.

7. At the hearing, there were three issues remaining in dispute: whether the word “strictly” should be deleted from condition 1; how the s 94 contributions should be calculated; and whether the applicant’s proposed amendments to condition 69 relating to the footpath and kerb and guttering should be accepted.

The site and locality

8. The site is bound by Mowbray Road to the north and Mindarie Street to the east and south. There are four dwelling houses currently on the site, with vehicular access on Mowbray Road and Mindarie Street. Towards the northeast of the site on the opposite side of Mindarie Street are single storey dwelling houses. Immediately to the west is 598 Mowbray Road which contains a single storey brick dwelling house. Further west of the site is 600-606 Mowbray Road on which construction is currently underway for a four storey residential flat building comprising 46 units. To the southwest of the site is 9-13 Mindarie Street on which construction is underway for a four storey residential flat building comprising 32 units; further southwest is 15-21 Mindarie Street, on which a part four storey and part five storey residential flat building comprising 72 units has recently been constructed.

Planning controls

9. The site is zoned R4 High Density Residential under the Lane Cove Local Environmental Plan 2009 (the LEP). Clause 4.4 of the LEP provides for a maximum floor space ratio of 1.6:1.

10. The Lane Cove Development Control Plan 2010 (the DCP) applies to the site. Relevant provisions are Part C3 Residential Flat Buildings, which includes section 3.10 Size and mix of dwellings; Part O Stormwater Management; Part Q Waste Management and Minimisation.

Evidence

11. The hearing commenced on site with a view, which included the three frontages of the site, the new residential flat developments at 600-606 Mowbray Road, and at 9-13 Mindarie Street, and the new footpath on the opposite side of Mindarie Street.

12. Expert evidence was given on stormwater and drainage issues on behalf of the applicant by Mr Bruce Kenny, and on behalf of the Council by Mr Ray Bechara. In their joint report (ex 4) Mr Kenny and Mr Bechara addressed the Council’s contention that the proposed changes to the drainage plans would be contrary to part O.4 of the DCP which does not permit direct connection of stormwater to the kerb and gutter for developments with underground basements or parking areas on the basis that underground car parks constantly collect ground water seepage in a sump that is regularly pumped out of the system even during period of dry weather, and that discharge can cause a danger to the public by creating a slip hazard, moss and algae build up. The experts agreed that where groundwater is constantly conveyed to a pump-out system and subsequently discharged to the kerb and gutter, the resulting gutter flow will not provide an acceptable outcome. They agreed that a pump-out system that is only required to manage stormwater generated by a small portion of driveway surface, while not specifically meeting the requirements of cl 5.4(g), would meet the intent of Part O.4 of the DCP and would provide an acceptable solution, and that a waterproofed basement structure which would not cause groundwater to be conveyed to a basement pump-out system could meet the intent of Part O.4 of the DCP. They agreed on amended conditions 58 and 59 requiring amended stormwater plans providing design and building of the basement requirements.

13. Expert evidence was given on waste management issues on behalf of the applicant by Mr Trevor Thornton and on behalf of the Council by Mr David Wilson. In their joint report (ex 5) Mr Thornton and Mr Wilson addressed the Council’s contention that the proposed change from a chute system to separate bins in the basement was inconsistent with the controls and intent of Part Q of the DCP. Clause 4.3 of Part Q states that residential flat buildings containing four or more storeys must be provided with garbage chute system(s) for the transportation of general waste from each storey to the main waste storage/collection room(s), with a dedicated service room on each floor to include a chute and recycling bins. Mr Thornton’s evidence was that the proposed amendments meet the aims and objectives of the DCP in respect of waste management within residential apartment buildings, as well as meeting best practice, as identified in the Better Practice Guide for Waste Management in Multi-Unit Dwellings (Department of Environment and Climate Change, 2008) (ex C). Mr Thornton notes that the Council acknowledges that the DCP is based on the Better Practice Guide, which provides three options for residential buildings of between 4 and 7 storeys, being no chute, with residents transporting waste to a central room; no chute, with residents using a room located on each floor; and a chute system. In his contribution to the joint report Mr Thornton outlines the operation of the revised waste management system, and consequent changes to monitoring cleaning requirements and the opportunity for a higher level of separation of material by residents resulting in a greater landfill diversion rate. The experts agreed that the proposed non chute system, for which a compaction system would not be used, would require an increase in the number of bins required. They agreed that the required number of bins could be accommodated in the basement garbage room with easy access to all residents, and which can be accessed by Council waste collectors by driving in to the building; that the proposed amendment would enhance landfill diversion of material by increasing types and volumes of materials collected. The experts agreed on amendments to include conditions 124, 125, 126, 127, 128 and 129, including the requirement in condition 129 for a total of 34 bins.

14. Expert evidence on planning issues was given on behalf of the applicant by Mr Gregor Zylber and on behalf of the Council by Mr Rajiv Shankar. In their joint report (ex 6) they addressed the Council’s contentions relating to FSR, the proposed deletion of “strictly” from condition 1; the calculation of the s 94 contribution; the mix of dwellings; and condition 69 relating to footpath and kerb and guttering.

15. There was agreement that the proposed removal of the two garbage chutes and incorporation of their areas on each floor into residential units, the gross floor area (GFA) of the development would increase by 40sqm, which constitutes an FSR of 1.616:1. Mr Zylber’s evidence was that the increase of GFA would have no impact on bulk, scale, footprint or siting of the approved building, and no adverse impacts on the amenity of surrounding residences in comparison with the approved development; and that the modified development satisfies the objectives of the FSR standard in cl 4.4 of the LEP and the relevant objectives of the R4 zone. Mr Shankar’s opinion was that there was no request under cl 4.6 of the LEP to vary the development standard, and it could not be justified.

16. In relation to the change in unit mix, Mr Shankar considered that the reduction in the number of 3 bedroom units would not provide adequate 3 bedroom units to provide for adequate opportunities for lifestyle choice and dwelling mix. He agreed with Mr Zylber that the resulting unit mix is consistent with the objectives provided in section C.3.1 of the DCP, as it provides acceptable amenity for residents and neighbouring properties, is sustainable, and provides opportunities for lifestyle mix, and is also consistent with the objectives of Part 4K Apartment Mix of the Apartment Design Guide.

Consideration

17. Section 96(2) of the Act enables modification of a development consent if the consent authority is satisfied that the development to which the consent as modified relates is substantially the same development as the development for which the consent was originally granted, and if the application has been properly notified and any submissions are considered. Section 96(3) provides that in determining an application for modification of a consent, the consent authority must take into consideration such of the matters referred to in s 79C(1) of the Act as are of relevance to the development the subject of the application.

18. In these proceedings there is no contention that the development to which the consent as modified is not substantially the same as the development for which the consent was originally granted, and I am satisfied there is no basis on the evidence for such a conclusion. The number of units remains the same, with a change of two units from one and three bedroom units respectively to two bedroom units; the other changes sought relate to ancillary aspects of the proposed development including stormwater and wastewater management, and provision of footpath and kerb and guttering.

19. As noted above, the Council did not press its contentions relating to FSR, stormwater and drainage, waste management, and unit mix.

20. I accept the agreed evidence of the stormwater and drainage experts and the consequent amendments to conditions 58 and 59 to reflect that agreement. I accept the agreed evidence of the waste management experts that the removal of the approved chute system and replacement with additional bins in an enlarged garbage room in the Basement provides a waste management system for the development that is consistent with the objectives of Part Q of the DCP, and on that basis, it is appropriate not to apply the requirement in cl 4.3 of the DCP for a chute system, and to approve the agreed insertion of conditions 125-129.

21. In relation to the increase in FSR, it was agreed that the changes to the GFA and thus the FSR are a consequence of the removal of the chutes for general waste and the chute rooms on each floor, and garbage room A in the Basement, which was the location of the chute termination with a carousel. The resulting FSR is 1.616:1, and cl 4.4 of the LEP sets the maximum FSR for the site at 1.6:1. It was common ground that it is not necessary that there be a cl4.6 variation to the development standard, as a modification application may be approved notwithstanding the development would be in breach of an applicable development standard were it the subject of an original development application: SDHA Pty Ltd v Waverley Council [2015] NSWLEC 65; North Sydney Council v Michael Standley & Associates Pty Ltd (1998) 43 NSWLR 468. However, the provisions of the LEP, which would include cl 4.4, are a relevant consideration: s 96(3) of the Act. I accept the evidence of Mr Zylber that the increase of GFA will have no impact on bulk, scale, footprint or siting of the approved building, and no adverse impacts on the amenity of the surrounding residences in terms of overshadowing, views, privacy or traffic generation in comparison with the approved development. The only change to the external appearance is the change to the living room glazing for unit UG.08, a change required by the Council in condition 37 of the original consent.

22. The proposed amendments to conditions 1, 11 and 69 remain in dispute.

Amendment to condition 1

23. Condition 1 provides:

That the development be strictly in accordance with the following drawing numbers ….

…

except as amended by the following conditions.

24. The applicant submits that the inclusion of the word “strictly” fetters the discretion of the certifier to allow minor adjustments to the plans in the course of issuing a construction certificate (CC). Section 80(12) of the Act provides that the CC and any approved plans and specifications issued with respect to that CC are taken to form part of the relevant development consent (other than for the purposes of section 96). The Council’s approach could potentially see the CC as the development consent, but the holder of the consent separately in breach of the Act by virtue of a breach of condition 1.

25. The Council submits that the word “strictly” as the same meaning as “in accordance with”. The development consent and the CC are completely separate processes, and s 96(1A) should be used for minor changes to the development consent. In any event, condition 1 is expressed to be “subject to other conditions” which would include condition 13, which requires that building works be carried out in compliance with BCA requirements, and which is a prescribed condition under s 80(11) of the Act, and cl 98 of the Environmental Planning and Assessment Regulation 2000 (the Regulation).

26. I accept that the inclusion of the word “strictly” would provide for a level of certainty that the proposed development would be in accordance with approved drawings and not modified by the certifier during the issue of a CC. However, I agree with the applicant that that would be inconsistent with the flexibility conferred by cl 145 of the Regulation, under which final construction drawings commonly introduce minor changes to approved DA plans which have no impacts on the critical aspects of the approved development, and would require for even minor changes numerous s 96 applications. Clause 145 provides:

(1) A certifying authority must not issue a construction certificate for building work unless:

…

(a)the design and construction of the building (as depicted in the plans and specifications and as described in any other information furnished to the certifying authority under clause 140) are not inconsistent with the development consent,

…

27. As noted by Sackville AJA, with whom McColl and Barrett JJA agreed, in Burwood Council v Ralan Burwood Pty Ltd (No 3) [2014] NSWCA 404 at [148]:

Not every difference between the DA and the plans and specifications furnished to the certifying authority and approved in the CCs amounts to an inconsistency in the relevant sense. As Lloyd J observed in El Cheikh v Hurstville City Council [2001] NSWLEC 175; 115 LGERA 425 at [74], albeit in another context, a difference does not necessarily constitute an inconsistency. Some adjustment to approved plans and specifications, as the primary Judge suggested, may be inevitable in a large and complex project.…

28. The word “strictly” should be deleted from condition 1.

Section 94 contributions

29. Condition 11 as originally imposed requires payment for an additional 77 (86.6-9.6) persons in accordance with the Council’s Section 94 Contributions Plan (the Contributions Plan), at the rate of $9,636 per person (in accordance with the 2014/15 Fees and Charges), a total of $726,340.00. The modification application seeks to amend this condition to reflect the change in unit mix, to an additional 73.1 persons, being a total of $693,813.20.

30. In its Statement of Facts and Contentions (ex 1) the Council contends that condition 11 should be further modified to apply the correct credit to the s 94 contribution calculations, on the basis that the credit to be applied to the contributions in condition 11 of the original consent was calculated incorrectly. The revised calculations and amendments to condition 11 as detailed in the Statement of Facts and Contentions was as follows:

Residential Contributions:

Dwelling Type	Number of dwellings	Persons per dwelling	Total Number of persons	Contributions payable @ $9,636/person
1 bedroom	21	1.2	25.2	$242,827.20
2 bedroom	26	1.9	49.4	$476,018.40
3 bedroom	5	2.4	12	*$100,000.00
Total	52	N/A	86.60	*$818,845.60

*Note: A cap of $20,000 per dwelling has been imposed under the Reforms of Local Development Contribution. As such, the Section 94 Contributions for the proposed three-bedroom dwellings are capped at $20,000 per dwelling, ie 5 dwellings x $20,000 = $100,000.00.

REVISED Credit for dwelling houses demolished:

Dwelling	Number of bedrooms	Occupancy Rate	Contribution Rate	Credit
594 Mowbray Road	3	2.8 persons	$9,636	*$20,000.00
596 Mowbray Road	4	3.6 persons	$9,636	*$20,000.00
5 Mindarie Street	3	2.8 persons	$9,636	*$20,000.00
7 Mindarie Street	5	4.3 persons	$9,636	*$20,000.00
Total	N/A	N/A	86.60	*$80,000.00

Total Section 94 Contributions Payable:

Contribution Type	Amount
Residential:	*$818,845.60
(Credit for dwellings):	*$80,000
Total Contribution:	$738,845.60

The total Section 94 contribution for the proposal is $738,845.60.

31. The planning experts disagreed as to the calculation of section 94 contributions.

32. Mr Shankar’s evidence was that the credit to be applied to the contributions in condition 11 of the original consent was correct. The occupancy rate identified in the Contributions Plan is applied in establishing the credit for existing dwelling houses to be demolished, however the cap is also applied to the credit. In his opinion applying the cap to both credit and debit is logical, and meets the objective of the Local Development Contributions Planning Circular, being to “increase housing supply by lowering development charges for infrastructure”; not applying the cap to any credit could be termed as “double dipping”; and if the cap to the credit is not applied the calculations are distorted.

33. Mr Zylber’s evidence was that the amended contribution amount of $738,845.60 is excessive and based on inadequate application of credit for the existing population of the four dwelling houses that will be replaced by the approved development. In his opinion the Council’s calculation method is based on a misinterpretation of the Ministerial Direction issued under s 94E of the Act which set a cap for each new dwelling in established areas. The application of a $20,000 cap for each existing dwelling in allocation of credit for existing population increases development costs and penalises new residential development, and in some instances would result in imposition of a section 94 contribution even if the development does not result in any net increase in the population. The credit for existing population should be based on the total existing population and not capped at a maximum $20,000 per dwelling. Adjusting for the proposed modified unit mix of 20 x one bedroom, 28 x two bedroom and 4 x three bedroom units, the contribution is:

• Gross contribution for the modified development based on projected population and $20,000 cap applied to three bedroom units = $823,899.20

• Credit for existing population = $130,086.00

• Actual contribution payable - $823,899.20 less $130,086.00 = $693,813.20

34. The applicant’s position is that the issue in this appeal is the proper calculation of section 94 contributions in accordance with the Contributions Plan, and not whether the power conferred by s 94B(3) of the Act for the Court to amend the condition on appeal because it is unreasonable in the particular circumstances of the case should be exercised. The applicant does not cavil with the calculation of average number of people per dwelling at p 15 of the Contributions Plan, or the amount per occupant. Section 11 of the Contributions Plan, which sets out how to calculate contributions for residential development, does not refer to either credits or the cap. The proper approach to the calculation is to factor in the credits before applying the cap. On that basis, the total number of occupants for the modified approved development is 86.8; applying a credit of 13.5 persons for the existing dwellings, the total is 73.3 persons. The credit should be applied equally to all units across the development, so that the new demand is only 84.4% of what it would otherwise be. On that basis, for a three bedroom unit the occupancy should be 2.08 persons per dwelling rather than 2.4 persons. The contribution for each dwelling, with a proportional reduction for credits, should be determined and then the cap should be applied. On that approach, and applying the 2014/2015 rate of $9,636 per person, the applicant submits that the total contribution required is $706,318.80.

35. The Council agrees that the Contributions Plan is silent as to what is to happen with credits for existing development in the context of the Ministerial Direction, which it pre-dates. In this instance the Ministerial Direction has work to do because it would apply the $20,000 cap to the three bedroom units: the required contribution at $9636 per person would otherwise be $92,505.60 without the cap. The difference between the approaches is that on the Mr Zylber’s approach of not applying the cap to the credit for existing dwellings, the credit would be $130,086.00, whereas on Mr Shankar’s approach, applying the cap, it would be $80,000.00.

36. Section 94(1) of the Act authorises the imposition of a condition requiring payment of a monetary contribution where development will or is likely to require the provision of or increase the demand for public amenities and public services within the area. Such a condition must be “determined in accordance with” a contributions plan: s 94B(1). The Council’s Contributions Plan (ex 3, tab 12) was adopted in August 1996 with subsequent amendments, with the works schedule (but not the contributions rate) amended in September 2013. The Contributions Plan at section 3.2.6 identifies average occupancy for residential development based on the number of bedrooms:

Type                                                                  Person/Dwellings

Separate Detached House (including

dual occupancy):

1 Bedroom                                                                1.5

2 Bedrooms                                                               2.0

3 Bedrooms                                                               2.8

4 or more Bedrooms                                                  3.6

5 or more Bedrooms                                                  4.3

…

Medium density developments (including

attached dual occupancy and duplexes):

1 Bedroom                                                                1.2

2 Bedrooms                                                              1.9

3 Bedrooms                                                              2.4

4 Bedrooms                                                              3.0

5 or more Bedrooms                                                4.0

37. Section 11 provides the method of calculation of contributions for residential developments, stating:

To calculate the contribution rate for a residential development, Council should:

●   Assess each Application for the likely number of residents per dwelling (using the occupancy rates outlined in Section 3.2.6).

●   Multiply the likely number of residents per dwelling by combined Section 94 levies for residential developments (as outlined above).

38. Section 11, and its examples of the process, does not refer to credits for existing development. The only reference in the Contributions Plan is at section 3.2.6, where following the list of average occupancy rates, it states:

The above occupancy rates will also be used for determining credits, for example, in the case of the demolition of an existing residence.

39. The Council’s Contributions Plan has not been updated to refer to the Ministerial Direction issued under s 94E of the Act, which provides that a council cannot impose a condition requiring the payment of a monetary contribution that “in the case of a development consent that authorises one or more dwellings, exceeds $20,000 for each dwelling authorised by the consent…” (Direction 21 August 2012, ex 3 tab 16).

40. Mr Zylber referred to the contributions plans applicable for Canada Bay, Ku-ring-gai and Hornsby, which on his evidence apply the $20,000 cap per dwelling to calculation of contribution attributable to the approved development and not to existing dwellings.

Findings

41. Section 94B(1) requires that a condition requiring payment of a monetary contribution must be “determined in accordance with” the relevant contributions plan. The Council’s Contributions Plan does not expressly consider application of credits, however in specifying the occupancy rate to be applied for that purpose, enables a determination to be made of the net increase in demand generated by new development. The issue is how to comply with the Ministerial Direction, which imposes the $20,000 cap “for each dwelling” rather than by reference to population.

42. The approach adopted by the applicant in submissions would result in a total contribution required of $706,318.80, which is more than the $738,845.60 calculated by the Council in its Statement of Facts and Contentions, and less than the calculation of $693,813.20 applying Mr Zylber’s approach. That approach has the attraction of applying the cap across the whole development, however it requires more complex calculations than those required by either the Council’s or Mr Zylber’s approach. More significantly, in reducing the notional occupancy per dwelling, that approach is not consistent with the specification in section 3.2.6 of the Contributions Plan of the average occupancy rates to be used both for determining both demand and credits. Calculation of the contributions and credits on that basis would not be “in accordance with” the Contributions Plan.

43. In their contributions to the joint report both Mr Shankar and Mr Zylber provided hypothetical examples of anomalies that would arise with the application of the competing approaches, including in Mr Shankar’s examples, where not applying the cap for the credit would result in a negative contribution payable. I accept that whichever approach is adopted there are likely to be anomalies, for example where new development is of a different type to existing development. In this instance, both the existing and the new development is residential, albeit with differing occupancy rates between the separate dwellings to be demolished and the approved multi dwelling development. While not relied upon in this appeal, one of the functions of the power conferred by s 94B(3) of the Act is to enable a reasonable outcome in such circumstances.

44. I agree with the Council that the approach adopted by Commissioner Brown in Eggleton v Manly Council [2014] NSWLEC 1010 is appropriate in the circumstances of this development. In Eggleton, an application for consent for demolition of an existing dwelling and construction of a boarding house with 17 dwellings, Brown C accepted that the applicant should not be entitled to a credit greater than the amount the council could collect given the Ministerial Direction, and determined that the credit of 2.7 persons for the existing three bedroom dwelling on the site should be $20,000.00, and not $42,089.76 applying the rate of $15,588.80 per person. As is the case with the Council’s Contributions Plan, the applicable plan in Eggleton specified the occupancy rates to be used to determine additional demand, and for determining credits. The applicant sought to distinguish Eggleton on the basis that the development in that appeal was the demolition of a dwelling and construction of a boarding house, however this appeal also involves a change in the type of development, with a consequent change in occupancy rates. In my view the Eggleton approach is consistent with the principle at section 2.2 of the Contributions Plan that contributions are for services and amenities which are needed as a result of the development, and its express provisions establishing occupancy rates per dwelling as a means of determining that demand. Based on that approach, I agree with the Council’s method of calculation of the contributions required, applying the cap to the credits.

45. The recalculation of condition 11 to reflect the changed unit mix agreed to by the Council was provided during the hearing:

Residential Contributions:

Dwelling Type	Number of dwellings	Persons per dwelling	Total Number of persons	Contributions payable @ $9,636/person
1 bedroom	20	1.2	24	$231,264.00
2 bedroom	28	1.9	53.2	$512,635.20
3 bedroom	4	2.4	9.6	*$80,000.00
Total	52	N/A	86.8	*$823,899.20

*Note: A cap of $20,000 per dwelling has been imposed under the Reforms of Local Development Contribution. As such, the Section 94 Contributions for the proposed three-bedroom dwellings are capped at $20,000 per dwelling, ie 4 dwellings x $20,000 = $80,000.00.

Credit for dwelling houses demolished:

Dwelling	Number of bedrooms	Occupancy Rate	Contribution Rate	Credit
594 Mowbray Road	3	2.8 persons	$9,636	*$20,000.00
596 Mowbray Road	4	3.6 persons	$9,636	*$20,000.00
5 Mindarie Street	3	2.8 persons	$9,636	*$20,000.00
7 Mindarie Street	5	4.3 persons	$9,636	*$20,000.00
Total	N/A	N/A	86.60	*$80,000.00

46. The total Section 94 Contributions payable at the 2014/2015 rate would be $823,899.20, less the credit of $80,000.00, a total of $743,899.20.

Condition 69

47. Condition 69 provides:

Council Construction Requirements: The applicant shall construct/reconstruct the following:

1. A new 1.5m footpath adjacent to the entire frontage of Mowbray Road and Mindarie Street adjoining the site.

2. New kerb and gutter along the entire frontage of Mowbray Road and Mindarie Street.

3. Reinstate all adjustments to the road surface to Council’s satisfaction.

4. Reinstate all existing nature strips with turf and soil to Council’s satisfaction.

48. The applicant seeks to amend condition 69 so that it provides:

Council Construction Requirements: The applicant shall construct/reconstruct the following:

1. A new 1.5m footpath along the Mindarie Street frontage of the site.

2. Remove the redundant driveways and reinstate kerb and gutter in those segments.

3. Reinstate all adjustments to the road surface to Council’s satisfaction.

4. Reinstate the nature strips along the frontages of the site with turf and soil to Council’s satisfaction.

49. There is presently no footpath on the Mindarie Street frontage of the site, and the existing footpath on Mowbray Road is 1.2m wide. There is one existing driveway access on Mowbray Road and three driveways on the Mindarie Street frontage: driveway and pedestrian access to the new development is from Mindarie Street on its eastern frontage. The applicant accepts the need to provide a footpath on the Mindarie Street frontage. Condition 69 requires lodgement of a $10,000 cash bond or bank guarantee to cover satisfaction of its requirements, and condition 51 requires lodgement of a $50,000 cash bond or bank guarantee to cover repair of damage or outstanding works to Council’s roads, footpaths, kerb and gutter, drainage or other assets as a result of the development. The applicant accepts both requirements.

50. The applicant is opposed to replacing the kerb and gutter on Mindarie Street and Mowbray Road, and submits that reinstating the sections where the existing driveways are is sufficient as it is not unusual to have new works joining with older works. The applicant submits that the existing 1.2m wide footpath on Mowbray Road is functional and the residents of the approved development are unlikely to use it; while they may walk to the school and shops there is no need for it to be 1.5m, and no warrant for that from this development. There is no basis for demolition of infrastructure that is in good order. The applicant submits that the Council’s version of condition 69 may have a planning purpose, however it does not fairly and reasonably relate to this development.

51. The Council submits that there is no evidence to establish that the works required by condition 69 are linked to works identified in the Contributions Plan. Council requires for all new development in the R4 High Density Residential zone new kerb and guttering and a 1.5m wide footpath. The development does contribute to an increase in the population in the locality and the footpath would give access to areas to the west including the shops and schools in an area undergoing significant transition to high density living. It is not unreasonable for the increased intensity of use of the footpath to require an upgrade consistent with nearby and adjoining development including 15-21 Mindarie Street, 600 Mowbray Road, and 544-550 Mowbray Road. The applicant’s proposal that parts of the gutter be filled in would result in a patchwork quilt outcome, and replacement of the kerb and gutter would provide an aesthetic outcome.

52. The planning experts disagreed as to whether condition 69 is unfair and does not reasonably relate to the development. Mr Shankar’s opinion was that the existing footpath on Mowbray Road is not in good condition and the increased width is required to provide better amenity to the residents given the increase in population. The kerb and gutter along Mowbray Road is already worn out and may be damaged in the course of construction, and construction of infill kerb and gutters would give a patchy appearance and be unsightly. Mr Zylber’s opinion was that the construction of the development does not entail access from Mowbray Road and it is unlikely either the kerb or the footpath would be damaged during construction. The existing footpath is in good condition and has adequate capacity to cater for future pedestrian traffic likely to be generated by approved residential flat buildings accessible from Mowbray Road. The development has no pedestrian access from Mowbray Road and given location of the closest bus stops future residents are unlikely to use the Mowbray Road footpath in front of the site. Mr Zylber’s opinion was that the existing kerb and gutter on the frontage of the site is in good condition, and the intent of the condition can be met by constructing an infill kerb and gutter in place of the single redundant residential driveway from Mowbray Road, and the three redundant residential driveways from Mindarie Street.

Findings

53. In considering the competing submissions concerning condition 69, the starting point is s 80A of the Act, in particular s 80A(1)(a), which permits the imposition of a condition if it relates to any matter referred to in s 79C(1) of relevance to the development the subject of the consent, and s 80A(1)(f) which permits the imposition of a condition if it requires the carrying out of works, whether or not on the land to which the application relates, relating to any matter referred to in s 79C(1) applicable to the development the subject of the consent. Identification of the nexus between the development authorised by the consent and the proposed condition is required both by s 80A(1) and by the proper application of the tests in Newbury District Council v Secretary of State for the Environment [1981] AC 578, namely that a condition can only be imposed for a planning purpose, must reasonably and fairly relate to the development, and must not be so unreasonable that no reasonable authority could have imposed it: Dogild Pty Ltd v Warringah Council (2008) 158 LGERA 429; Cavasinni Constructions Pty Ltd v Fairfield City Council [2010] NSWLEC 65; Botany Bay City Council v Saab Corporation Pty Limited [2011] NSWCA 308. In Saab, Basten JA, with whom Macfarlan JA agreed, noted (at para [9]) that there may be a question as to how distant, remote or indirect the relationship may be between the proposed development and the matters referred to in s 79C(1).

53. The objectives of the R4 zone include to “provide for the housing needs of the community within a high density residential environment”. Section C3 Residential Flat Buildings of the DCP includes the objectives:

1.    To achieve a reasonable level of amenity for the residential flat buildings, neighbouring properties and the surrounding area.

2.    To achieve sustainable development whilst providing a concentration of residents close to public transport and facilities.

55. The view included a view of the existing kerb and guttering, and the existing footpath on Mowbray Road. To the west of the site along Mowbray Road are local shops and Mowbray Public School, less than two blocks away, and there are bus stops on both sides of Mowbray Road.

56. The development provides 52 dwellings and, on the occupancy rates in the Contributions Plan, an additional 73.3 residents. While pedestrian access to the development is from Mindarie Street and there is no pedestrian access from the development to Mowbray Road, given the proximity to the development I do not accept that residents are unlikely to use the Mowbray Road footpath to access the local school and shops to the west along Mowbray Road, and the bus stops in both directions. The objectives in the DCP include providing a reasonable level of amenity, which would include provision of safe pedestrian access for residents to services and facilities. Having regard to those objectives, I am satisfied that condition 69 can be considered to have a planning purpose.

57. The issue is whether the requirement to provide a 1.5m footpath on Mowbray Road and the requirement to provide new kerb and guttering along Mindarie Street and Mowbray Road can be said to reasonably and fairly relate to the development. Given the requirements in conditions 51 and 69 for lodgement of a bond, any damage to either the footpath or the existing kerb and guttering during the course of construction can be rectified. There were no defects in the footpath identified or observed on the view, and I agree with the applicant that the existing 1.2m wide footpath is functional. It can be assumed that some of those using the footpath would do so with prams, or be in wheelchairs or use other mobility aids. The evidence does not support a conclusion that the existing 1.2m footpath is not trafficable or is unsafe, even for such users. The Council’s Traffic and Transport officer commented on the referral of the modification application, noting the Council’s Pedestrian Access and Mobility Program and Bicycle Plan, that “it is considered appropriate that footpath upgrades along both Mowbray Road and Mindarie Street are completed as part of the development” (ex 3, p 113). While I accept that such an upgrade would be desirable, in the context of an area in transition to significantly higher residential density, and would be consistent with provision of 1.5m wide footpaths in the locality as observed on the view, I am not persuaded that the requirement to replace the existing footpath with a wider footpath reasonably and fairly relates to the development.

58. Similarly, there were no defects identified on the view in the existing kerb and guttering along either street frontage. The applicant accepts the need to reinstate the kerb and gutter where the existing driveway crossings are removed, and there is no evidence that there are technical or safety issues with the reinstatement proposed by the applicant. The primary argument in support of the Council’s position is essentially an aesthetic one, based on its concern for a “patchwork quilt” outcome. I am not persuaded that the replacement of the kerb and guttering along both frontages can be said to fairly and reasonably relate to the development.

59. As a consequence, I am not satisfied that condition 69 in the form imposed by the Council can lawfully be imposed, and it should be modified as proposed by the applicant.

Conclusion

60. On the matters remaining in dispute between the parties at the conclusion of the hearing, I am satisfied that conditions 1 and 69 should be amended as proposed by the applicant. Condition 11 is to be amended to be consistent with the Council’s calculation of section 94 contributions, reflecting the amended unit mix.

61. The parties are directed to provide, by close of business 4 July 2016, amended conditions in the form adopted by the Court in making orders in appeals under s 97AA of the Act for modification applications, namely a document comprising new conditions added and existing conditions to be altered or deleted, and a consolidated set of conditions of development consent incorporating all conditions proposed to apply to the modified proposal as approved. On receipt of those documents, orders will be made in chambers as follows:

1. The appeal is upheld;

2. The Modification Application made on 7 September 2015 to modify Development Consent No D202/14 for the demolition of existing dwellings and construction of a residential flat building comprising 52 units and parking for 85 cars at 5-7 Mindarie Street and 594-596 Mowbray Road Lane Cove North is determined by approving the modifications as set out in Annexure A;

3. As a consequence of order (2), Development Consent No D202/14 is now subject to the consolidated, modified conditions of development consent set out in Annexure B; and

4. The exhibits, other than Exhibits 1, 7, A and B, are returned.

Addendum made on 5 July 2016

62. In accordance with the terms of paragraph 61 of my judgment of 24 June 2016, on 1 July 2016 the parties provided agreed amended conditions of consent. I am satisfied that the conditions of consent accord with my findings and accordingly I make orders in chambers as follows:

1. The appeal is upheld;
2. The Modification Application made on 7 September 2015 to modify Development Consent No D202/14 for the demolition of existing dwellings and construction of a residential flat building comprising 52 units and parking for 85 cars at 5-7 Mindarie Street and 594-596 Mowbray Road Lane Cove North is determined by approving the modifications as set out in Annexure A;
3. As a consequence of order (2), Development Consent No D202/14 is now subject to the consolidated, modified conditions of development consent set out in Annexure B; and
4. The exhibits, other than Exhibits 1, 7, A and B, are returned.

166916.16 Pearson (C)_Annexure A (278 KB, pdf)

166916.16 Pearson (C)_Annexure B (380 KB, pdf)

Linda Pearson

Commissioner of the Court

**********

Amendments

05 July 2016 - Addendum made on 5 July 2016.

Amendments made to:

paragraph [9]: change "0.6:1" to "1.6:1"

paragraph [21]: change "0.616:1" to "1.616:1", and change "0.6:1" to "1.6:1"

Annexure A & B attached

Decision last updated: 05 July 2016