Thaina Town v City of Sydney

[2006] NSWLEC 624

Land and Environment Court

of New South Wales

CITATION:

Thaina Town v City of Sydney [2006] NSWLEC 624

PARTIES:

APPLICANT
Thaina Town (On Goulburn) Pty Limited

RESPONDENT
Council of the City of Sydney

FILE NUMBER(S):

10497 of 2006

CORAM:

Brown C

KEY ISSUES:

Appeal :- issue of a Prevention Notice - operation of a restaurant in an environmentally unsatisfactory manner

LEGISLATION CITED:

Protection of the Environment Operations Act 1997

DATES OF HEARING:

18/09/06

 
DATE OF JUDGMENT: 

10/05/2006

LEGAL REPRESENTATIVES:

APPLICANT
Ms L Byrne, barrister
SOLICITORS
C. P. White & Hetherington

RESPONDENT
Mr S Kondilios, solicitor
SOLICITORS
Maddocks

INTERVENOR
DR S Berveling, barrister
SOLICITORS
L Rundle & Co

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Brown C

5 October 2006

10497 of 2006 Thaina Town (On Goulburn) Pty Limited v Council of the City of Sydney

JUDGMENT

1 COMMISSIONER: This is an appeal against the issue of a Prevention Notice under s 96 of the Protection of the Environment Operations Act 1997 (POEO Act) by the Council of the City of Sydney (the council) for the operation of a restaurant in an environmentally unsatisfactory manner at 85 - 91 Goulburn St, Sydney (the site).

2 A Notice of Motion was heard on the morning of the hearing to allow the Owners Corporation SP 70938 (the intervenor) to intervene in proceedings. Leave was granted to the intervenor to adduce evidence, cross-examine witnesses and make submissions in the proceedings.

The site

3 The site is formally described as Lot 85 in DP 1041468 and Lots 1 – 49 in Strata Plan 70938 with the restaurant and a separate coffee shop being Lot 48. The building erected on the site comprises a 16 storey retail, commercial and residential flat building with basement parking. The retail component comprises the restaurant and coffee shop on the ground floor with direct access to Goulburn St.

Background

4 The applicant has a five-year lease of Lot 48, commencing 1 November 2003. Development Consent D/00/00565 granted approval for the restaurant. Owners Corporation SP 70938 and the council consented to the applicant’s Construction Certificate for the fit out of the restaurant. The restaurant has operated since February 2004.

5 On 10 April 2006 the council received a complaint, in part, over odours, within the building by the owner of the penthouse on level 15 of the building. Following an inspection by council, odours, cooking grease and oil were found to be discharging from the exhaust system into the plant room, one level above the penthouse on level 15.

The regulatory framework

6 Section 96 of the POEO Act states, in part:

96 Preventive action
(1) Application of section
This section applies when the appropriate regulatory authority reasonably suspects that an activity has been or is being carried on in an environmentally unsatisfactory manner at any premises or by any person (otherwise than at premises).
(2) Prevention notices
The appropriate regulatory authority may, by notice in writing, do either or both of the following:
(a) direct the occupier of the premises,
(b) direct the person carrying on the activity (whether or not at premises),
to take such action, as is specified in the notice and within such period (if any) as is specified in the notice, to ensure that the activity is carried on in future in an environmentally satisfactory manner.
The Prevention Notice

7 The relevant parts of the Prevention Notice state:

Activity Suspected of Being Carried on in An Environmentally Unsatisfactory Manner
The City of Sydney Council, being the appropriate regulatory authority for the purposes of Part 4.3 of the Protection of the Environment Operations Act 1997, (" Council "), suspects that an activity, namely your use of the mechanical ventilation kitchen system (" the exhaust system "), has been or is being carried on in an environmentally unsatisfactory manner at 85 - 91 Goulburn St, Sydney, ("the premises"), insofar as;
(a) odours, cooking grease and oil are discharging from the exhaust system into the plant room level of the premises;
(b) odours, cooking grease and oil are discharging from the exhaust system onto the roof level of the premises
(c) odours smelling of grease and cooking oil are discharging from the exhaust system throughout the premises in concentrations that are discernible by other occupants of the premises as an "offensive odour" within the meaning of the Protection of the Environment Operations Act 1997;
(d) installation of the exhaust system does not comply with either or both the Building Code of Australia, (" the BCA "), or Australian Standard AS1668.2-1991, (" the AS ").

Direction to take preventive action;
To ensure that the above activity is carried out in future in an environmentally satisfactory manner, Council directs you to take the following preventive action;
1. Have the exhaust system, plant room level and roof level cleaned, including removal of all grease, oil and other substances, by a suitably qualified kitchen exhaust contractor within 14 days from the date on which this Prevention Notice is given to you; and
(a) Submit to Council, within 28 days from the date on which this Prevention Notice is given to you, a Compliance Assessment Report prepared by a suitably qualified mechanical ventilation engineer identifying all remedial works, repairs, alterations and/or replacement of plant, (including all plans and specifications), necessary to have the exhaust system comply with the BCA and the AS.
The issue

8 At the hearing, the council did not press that part of the Prevention Notice that required the exhaust system, plant room level and roof level to be cleaned as these works had already been carried out. The single issue pressed by the council was whether the applicant is responsible for the preparation of the Compliance Assessment Report described in par 1(a) of the Prevention Notice. The intervenor maintained that the Prevention Notice should be complied with in total.

The council’s case

9 Mr Kondilios, for the council submits that the applicant is the occupier of the premises and the person carrying on the activity in an environmentally unsatisfactory manner and is therefore responsible for the consequential impacts caused by it’s occupation and use of ground floor restaurant, including issues with the mechanical ventilation exhaust system. As the applicant is the only user of the mechanical ventilation exhaust system he remains responsible and liable for the discharge of any waste, odours or other pollutants that are the result and consequence of occupation and use of the restaurant.

10 Mr John Parliaros, a Senior Environmental Health Surveyor with the council provided an affidavit outlining an inspection of the penthouse on level 15 on 12 April 2006. He noticed a distinctive cooking odour at the time, which was strongest in the living and television room.

11 Mr Alex Kiss, the Acting Health Inspection Manager with the council also provided an affidavit outlining his inspections of the restaurant and the penthouse on level 15. On 3 May 2006 he inspected the kitchen of the restaurant where he found that the kitchen and its mechanical exhaust system appeared to be generally satisfactory. There were no odours noticeable at the time. The kitchen was again inspected on 11 May 2006 where he conducted an anemometer airflow check of the kitchen exhaust system and found that the airflow rates to the satisfactory. On 19 May 2006 an inspection of the plant room was undertaken where he found extensive leaking of oil and grease from the duct work of the exhaust system. He also identified strong a "cooking odour". He also noted that the exhaust discharge was being discharged immediately at the roof level, which he described as unusual. On 20 June 2006 Mr Kiss inspected the penthouse on level 15 where a cooking odour was noticeable in the media room.

The intervenor's case
Dr Berveling, for the intervenor supports the submissions of the council and maintains that the applicant is responsible for the discharge of any waste, odours or other pollutants that are the result and consequence of occupation and use of the restaurant. He states that the terms of s 96(2) specifically require that a Prevention Notice be served on the occupier of the premises and/or the person carrying on the activity and as such, the applicant is the appropriate person.

The applicant’s case

12 Ms Byrne, for the applicant, submits that the applicant is only responsible for the kitchen of exhaust system within the confines of the restaurant and subject to its obligations under the lease with the owner of Lot 48. The applicant has all times complied with all consent's, codes and standards in respect of the equipment within the restaurant and property. If there is an "offensive odour" discharging from the exhaust system it is due to defects in the mechanical exhaust ventilation system installed in the building by the original builders and the contractors, servants and agents.

13 Any non-compliance of the mechanical ventilation system with the BCA and Australian Standards in the building is not the responsibility of the applicant to rectify or replace but is the responsibility of the Owners Corporation SP 70938. The applicant is not the "occupier of premises" in the meaning of that term in the Dictionary to the POEO Act, being premises in which the mechanical ventilation system is located.

14 Mr Darong Sukdee, a Director and the Secretary of the applicant company provided an affidavit setting out the history of his occupation of the restaurant, including the more recent issues over the odours, cooking grease and oil discharging from the exhaust system into the plant room

Findings
The mechanical ventilation system

15 The mechanical ventilation system in question is a dedicated system for the restaurant. The applicant has sole use of this dedicated system. Other independent ventilation systems have been constructed within the building for other parts of the building any including the basement car park and residential uses.

16 The mechanical ventilation system for the restaurant can, in practical terms, be divided into two distinct sections i.e., external to the restaurant and within the restaurant even though the two sections are used exclusively by the applicant.

17 The ventilation system external to the restaurant was constructed as part of the building and in anticipation of the use of Lot 48 as restaurant or a similar use. The opportunity to connect to this ventilation system is provided through the rear wall of Lot 48. The ducting for the ventilation system rises 16 floors to the rooftop plant room. This part of the ventilation system is included within the common area of Strata Plan 70938.

18 The ventilation system within the restaurant provides for a ventilated hood over the cooking area and it’s connection to the ventilation system external to the restaurant. The applicant is responsible for this part of the ventilation system through conditions of the lease and any requirements of the council.

19 There was no evidence to suggest that the ventilation system within the restaurant was operating in an environmentally unsatisfactory manner or not in compliance with the Building Code of Australia or Australian Standard AS1668.2. Council approved the Construction Certificate on 31 October 2003 and on 24 February 2004 following an inspection, the council were satisfied that the mechanical ventilation system was constructed in accordance with the approved plans and conditions. A letter, addressed to the council from a Spruce Installations Pty Limited indicated that the mechanical ventilation systems installed in the restaurant have been tested and comply with Australian Standard AS1668.2 2002.

20 Additionally, Mr Kiss took no issue with the installation of the internal ventilation system within the restaurant in his site visits prior to the hearing. He confirmed the satisfactory installation of the restaurant ventilation system when giving evidence in the proceedings.

21 On the other hand, the evidence suggests the mechanical ventilation system external to the restaurant and within the common property could be deficient. As early as November 2003 the applicants consultant, Spruce Installations Pty Limited, identified the existing top kitchen exhaust fan was under capacity. Further reports from BAAM Consulting (2 June 2004), G J Reed & Associates Pty Limited (16 March 2006) and Mr Kiss identified deficiencies in the mechanical ventilation system.

22 In this case, I am satisfied that the environmentally unsatisfactory impacts, i.e., odours, cooking grease and oil discharging from the exhaust system into the plant room, are not from the installation or operation of the restaurant hood filtration system, so by exclusion, are likely the result of deficiencies in the external mechanical ventilation system.

Is the applicant the occupier of premises?

23 The POEO Act Dictionary defines “premises” as including:-

(a) a building or structure, or
(b) land or a place (whether enclosed or built on or not), or
(c) a mobile plant, vehicle, vessel or aircraft.

24 The POEO Act Dictionary defines “occupier” of premises as meaning “ the person who has the management or control of the premises”.

25 I accept that the external mechanical ventilation system is appropriately defined as the “premises”, being a structure. As s 62 of the Strata Schemes Management Act 1996 provides that the maintenance and repair of common property rests with the owners corporation, the applicant does not have the management or control of the premises. Consequently, I find the applicant is not the occupier of premises.

Is the applicant the person carrying out the activity?

26 The POEO Act Dictionary defines “activity” as meaning "an industrial, agricultural or commercial activity or an activity of any nature whatever (including the keeping of a substance or animal)".

27 I accept that the “activity” is the external mechanical ventilation system. In my view, the definition is sufficiently broad to allow this interpretation rather than the interpretation suggested by the council and intervenor where the activity is the total operation of the restaurant and all resultant impacts caused by it’s occupation, including issues with the mechanical ventilation exhaust system. Consequently, I find the applicant is not the person carrying on the activity.

Conclusion

28 As the applicant does not have the management or control of the external mechanical ventilation system it is manifestly unreasonable that he should be burdened with costs associated with the further investigation of its adequacy. Considering those matters set out in s 96(2) of the POEO Act, I find that the applicant is not the appropriate occupier or person for the issue of a Prevention Notice relating to the odours, cooking grease and oil discharging from the exhaust system into the plant room.

Orders

29 The orders of the Court are:

1) The appeal is upheld.
2) The Prevention Notice under s 96 of the Protection of the Environment Operations Act 1997 for the operation of a restaurant in an environmentally unsatisfactory manner at 85 - 91 Goulburn St, Sydney is revoked.
3) The exhibits are returned.
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G T Brown
Commissioner of the Court