Woolworths Limited v Randwick City Council

[2018] NSWLEC 1183

Land and Environment Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Woolworths Limited v Randwick City Council [2018] NSWLEC 1183

Hearing dates:

20-21 December 2017

Date of orders:

09 May 2018

Decision date:

17 April 2018

Jurisdiction:

Class 1

Before:

Dixon SC

Decision:

The Court orders:

(1)     The appeal is upheld.

(2)     Consent is granted to Development Application no. DA 284/2014 for the development of a Dan Murphy’s retail liquor store on the ground floor of the former Randwick Rugby Club premises being Lot 1 in DP 1050706 known as 102 – 104 Brook Street, Coogee subject to the conditions in Annexure A.

(3)     The exhibits, other than exhibits A, B, C & 1 are returned.

Catchwords:

APPEAL – development application – conversion of club to liquor store - statutory construction of Local Environmental Plan – development for the purposes of a shop

Legislation Cited:

Environmental Planning and Assessment Act 1979
Randwick Local Environmental Plan 2012

Cases Cited:

Woolworths Ltd v Randwick City Council [2016] NSWLEC 82
Woolworths Ltd v Randwick City Council [2017] NSWCA 179
Project Blue Sky Inc & Ors V Australian Broadcasting Authority (1998) 194 CLR 355
House of Peace Pty Ltd & Anor v Bankstown City Council [2000] NSWCA 44
State Chamber of Commerce and Industry v Commonwealth (1978) 163 CLR 329
Martin Morris & Jones Pty Ltd V Shoalhaven City Council [2012] NSWLEC 1280

Texts Cited:

The Macquarie Dictionary 3rd Edition

Category:

Principal judgment

Parties:

Woolworths Limited (Applicant)
Randwick City Council (Respondent)

Representation:

Counsel:
Ms S Duggan SC (Applicant)
Mr A Seton (solicitor) (Respondent)

  Solicitors:
Mills Oakely (Applicant)
Marsdens Law Group (Respondent)

File Number(s):

2016/154399

Publication restriction:

No

Judgment

1. Development application no. DA 284/2014 (the DA) was lodged with Council on 4 May 2015 and seeks development consent for a Dan Murphy’s retail liquor store which, other than parking, is confined to the ground floor of the former Randwick Rugby Club premises at 102 – 104 Brook Street, Coogee (the site).

2. The development comprises:

1. the change of use at the ground floor level from the Randwick Rugby Club to a Dan Murphy store;

2. proposed signage associated with Dan Murphy;

3. fit out and other minor works to enable the lot to operate as a Dan Murphy’s, namely:

1. demolition of some existing internal partition walls, ceilings, lighting, kitchens, toilets, floor finishing, joinery and furniture on the ground floor of the existing building;

2. improvements to the existing loading dock to ensure there is no loading or unloading on local streets with entry into an egress out of the site in a forward direction;

3. proposed new openings to existing internal walls to create separate customer entry and exit points to the car parking spaces of the existing building;

4. proposed internal fit out ;

4. structural improvement works.

3. The proposed hours of operation for the liquor store are from 9 AM to 10 PM, Monday to Saturday and 10 AM to 10 PM on Sunday.

4. The development plans are dated 23 December 2015 and marked Exhibit C (although the reference in the plans to “retail use for a future café” is no longer part of this application).

Facts

5. The essential facts in this case can be stated shortly.

6. The shop is proposed within the ground floor of an existing commercial building.

7. The building is located on the western side of Brook Street, between Dolphin Street and Ormond gardens. It is opposite the western end of Coogee Oval.

8. The ground floor of the building, where the shop is proposed, is a stratum allotment known as Lot 1 in DP 1050706. The stratum also includes a basement within the building containing 40 car parking spaces and a loading dock facility at grade with vehicular access from Brook Street.

9. The application is to utilise the existing plant and equipment from the former club use of the site and 39 of the off-street car spaces and the loading dock.

10. Above the proposed shop is a five storey residential flat building with car parking beneath. Behind this building, on the same block of land, is a second residential flat building of similar height with parking in a basement level.

11. The proposed shop is about 120m from the intersection of Brook Street and Coogee Bay Road. This eastern end of Coogee Bay Road is a different land zoning and contains shop top housing developments which vary from single to four storeys in scale. The surrounding area of the site is characterised by a mix of low to medium density residential development consisting of single and two-storey residential dwellings and up to four storeys walk up residential flat buildings.

12. Immediately adjacent to the site are heritage items. There is the “Cantley’s Wall – Sandstone retaining wall” and “Inter- war Residential Flat Building” to the south at 108 Brook Street and, a group of “two-storey Edwardian style semis circa. 1915”, comprising nos. 90- 100 Brook Street to the north. To the west (rear) of the site is a row of three, two storey residential flat buildings with ancillary parking structures located at their rear.

13. The map reproduced below, taken from the Council’s file, identifies the site in red outline.

14. As part of the circumstances of the case, and as background to the application only I note that the site previously held a registered club licence that could hold up to 430 patrons at any one time and it was entitled to trade up to, and including 1:30am on certain occasions. Following the lapsing of the registered club licence, the applicant has obtained temporary licences in order to continue use of the premises as a club during, and until the assessment of this development application was complete. I am told that there is no impediment to the applicant continuing to use the site as a club irrespective of the outcome of this appeal.

Statutory controls

15. The site is located within the R3 – Medium Density zone under the Randwick Local Environmental Plan 2012 (LEP).

16. Development for the purposes of a “shop” is permissible with consent subject to the provisions of cl 6.13. The clause operates to restrict development for the purposes of shops in the R3 zone unless the development meets the requirements of subclause 3(a), and the consent authority is satisfied about the matters in subclause (3) (b).

17. Clause 6.13 provides as follows:

6.13 Business premises, office premises, restaurants or cafes and shops in residential zones

(1) The objectives of this clause are as follows:

(a) to provide for the establishment and continued operation of small-scale business development in residential zones, used in conjunction with dwellings or otherwise,

(b) to enable the use of existing commercial buildings for office premises, business premises, restaurants or cafes and shops in residential zones,

(c) to provide neighbourhood-scale commercial development to encourage walking and cycling as preferred modes of access.

(2) This clause applies to the following:

(a) in Zone R2 Low Density Residential and Zone R3 Medium Density Residential—development for the purposes of business premises, office premises, restaurants or cafes or shops,

(b) in Zone R1 General Residential—development for the purposes of business premises, office premises or shops.

(3) Development consent must not be granted to development to which this clause applies unless:

(a) the development relates to a building that existed when this Plan commenced and was designed or constructed for the purpose of commercial premises, and

(b) the consent authority is satisfied that:

(i) the development will not adversely affect the amenity of any residential component of the development and the surrounding locality, and

(ii) the intensity of development is suitable for the building, and

(iii) the degree of modification of the footprint and facade of the building is consistent with the scale and desired attributes of surrounding development.

18. The Council has already raised a preliminary question of law in respect of the application of cl6.13 (3) (a) to this development which was decided by Moore J on 7 July 2016 Woolworths Ltd v Randwick City Council [2016] NSWLEC 82. This decision was appealed to the Court of Appeal and determined on 25 July 2017. On appeal the Court held that the development application relates to a building that was designed or constructed for the purpose of commercial premises in accordance with cl6.13(3) (a) of the LEP: Woolworths Ltd v Randwick City Council [2017] NSWCA 179. The Court of Appeal has remitted the proceedings to the Land and Environment Court to determine the remainder of the Class 1 proceedings.

The issue

19. The parties have submitted an agreed statement of facts and contentions (Exhibit A) and statement in reply (Exhibit 1) which has assisted to crystallise the principal contested issues. The dispute is now confined to competing interpretations of the zone objectives and the provisions of cl6.13 (1) (a) and (3) (b) of the LEP. Also relevant are the concerns relayed by the objectors which form part of the public interest and are relevant considerations under s4.15 of the Environmental Planning and Assessment Act 1979 (EPA Act).

Overview of the Council’s position

20. By way of overview, the Council’s case is that:

1. the proposed development will adversely affect the amenity of the surrounding locality having regard to the likely adverse social impacts on the local community associated with the bulk discount takeaway liquor premises including alcohol-related antisocial behaviour and violence;

2. the location of the proposed development is inappropriate having regard to the residential character of the area and its intensification of operation; and;

3. the proposed development is not consistent with the objectives and provisions of cl 6.13(3) (b) RLEP 2012 and the R3 zoning in that it is not of a “small-scale” nature.

Overview of the applicant’s position

21. The applicant contends that the development is essentially a change of use of the club component of the building for use as a business premises/shop. As such, the development is proposed within an approved and existing building envelope, and will not have an adverse effect on the amenity of the surrounding locality. According to the applicant the likely adverse social impact of the development in the community is low.

22. The shop, if approved will only sell packaged liquor, with no consumption of liquor on the premises (other than occasional promotional tasting of products).

23. The shop will trade for shorter hours than the former club use which would have had far greater amenity impacts for the local objectors than the proposal.

24. The applicant contends that the location of the development is acceptable considering the zoning of the site; the existing use of the premises is a club; its close proximity to existing public transport and sitting within a high density residential area. In short, the development is of an appropriate scale and nature and consistent with the objectives of cl6.13 (3) (b) of the LEP.

25. The applicant also contends that there is a strong market for the provision of the retailing offering proposed in this DA, and the ongoing use of the existing commercial premises is a prime objective of the LEP and in the public interest.

The Lay Witnesses

The supporters

26. Prior to the lodgement of the development application the applicant undertook extensive public consultation with the residents living in the existing building in order to address any concerns in relation to the proposed development. During that process the residents raised concerns about the previous operation of the site as a club particularly in respect of adverse acoustic amenity generated by truck deliveries, patrons entering and existing and the general use of the club. These identified concerns are no longer an issue, at least for the residents of the building. The owners’ corporation, on behalf of the residents living in the existing building, has now lodged a submission in support of the development application. The submitters in support of the proposal who addressed me at the commencement of the hearing (including a representative of the executive committee of the apartments above) said that the amenity impacts that will be generated by the commercial use proposed will be better than those experienced when the former club was in use. Collectively, they are pleased that the liquor shop will close at 10pm and that there will no longer be inebriated people leaving the premises at closing time. They are pleased that the proposed shop use will not generate food waste issues and/or exhaust smells for the residential part of the building.

27. Given the rear parking/access to the shop now proposed from the car park the supporters anticipate there will be fewer people walking down the driveway generating traffic/pedestrian conflict when they are trying to negotiate their vehicles out of their basement car park. The supporters are also content with one operator in the commercial space as opposed to several smaller shops. They told me that with one operator the area is likely to be better controlled.

28. Relevantly, the police have raised no objection to the application however, other local residents have and their views are summarised below.

The objectors

29. The objectors to the application believe that the proposed Dan Murphy liquor store is excessive in scale and does not comply with the objectives of cl 6.13 which seek “to provide for the establishment and continued operation of small-scale business development in residential zones, used in conjunction with dwellings or otherwise”, and “…neighbourhood –scale commercial development to encourage walking and cycling as preferred modes of access”.

30. Mr Magney, who resides at 98 Brook Street, is an objector to the proposal. He has lodged a written submission with the Council and also addressed the Court at the commencement of the hearing at the site. Generally speaking, the concerns he expressed about the development were representative of the views held by a number of objectors. In summary, Mr Magney said that he opposes the development because he believes that the proposed liquor store is too big. He described the store as being “…5 to 10 times larger than other local liquor outlets e.g. Little Brother on Coogee Bay Road -100m2/Chambers Cellars on Clovelly Road – 70m2/BMS Coogee Bay Road – 210m2/Vintage Cellars Clovelly Road -220m2” . In his opinion, it cannot be described as “small scale”. Therefore, in his view the proposed Dan Murphy store in this location is contrary to the relevant planning controls.

31. Mr Magney described Brook Street as “a residential thoroughfare in a densely populated neighbourhood”. In that regard, Mr Magney pointed out that Brook Street is the only means of access to Coogee Oval for maintenance and for year round sporting groups/spectators. In that regard, he explained that the oval is used in winter for rugby union matches on Saturdays and ruby league matches on Sundays from 9am till 5pm. In summer, cricket is played on the oval on both days of the weekend from 11am till 6 pm. Moreover, he stressed, Brook Street is the only location where the fans enter all ticketed events at the oval. For those reasons, Mr Magney said that the street is congested enough and an approval of the proposed Dan Murphy liquor shop on this site will only exacerbate existing traffic/pedestrian congestion in the area.

32. Mr Magney and several other local objectors who gave evidence at the onsite part of the hearing were keen to emphasise to the Court that Brook Street is also the vehicle entry point for the Coogee Village Shopping Centre parking area and the loading bay. These witnesses said that all trucks servicing that Centre must use Brook Street for deliveries. The Centre contains a Woolworths store and the objectors who addressed the Court said that they regularly experience large Woolworths delivery trucks blocking access to Brook Street and Alfreda Street when manoeuvring to access the loading dock in the Centre. When this happens, they said, traffic turning into Brook Street from Coogee Bay Road is often halted for significant periods while the trucks manoeuver into and out of the Centre’s loading bay.

33. Collectively, the lay objectors believe that an approval of this application will exacerbate the existing traffic and parking problems they experience in the area particularly, Brook Street. They also fear that it will encourage adverse social impacts in the local community from increased availability of alcohol. The local residents particularly object to the location of a bulk goods liquor store, as they describe the proposal located immediately adjacent to an area identified by the Council as an Alcohol Free Zone (AFZ). Moreover, they believe that the development will undermine the Council’s strong stance against alcohol related violence within the Local Government Area. They fear that a proliferation of packaged liquor outlets in the area will increase alcohol related violence and social impacts for their local community. For all of those reasons they believe that the development is not in the public interest and should be refused.

The expert evidence

34. To a large extent the concerns raised by the objectors in their oral and written submissions contained in Exhibits 11 and 3 are addressed by the expert evidence brought forward by the parties. The experts who assisted the Court were:

• Traffic - Mr McLaren (Council) and Mr Rodgers (Applicant) (individual report Exhibit D) ( joint report Exhibit 5)

• Social Impact - Professor Roberta Ryan (Applicant) (individual report Exhibit E) and Dr Alison Ziller (joint report Exhibit 6).

• Town planning – Mr Brindle and Mr McDonald (joint report Exhibit 7).

35. The Council submits that the scale of the development is a ‘significant issue’ in the appeal. The applicant takes a different view. I will deal with this matter first and then deal with the other issues in the case.

The construction of the LEP

The Council’s position

36. By operation of cl 2.3 of the LEP I am required to have regard to the R3 zone objectives in my assessment of the DA. The Council submits the following objectives are of particular relevance:

• “To enable other land uses that provide facilities or services to meet the day to day needs of residents”;

• “To protect the amenity of residents”

• “To enable small-scale business uses in existing commercial buildings”.

37. When I have regard to these objectives, the Council submits that I will place significant weight on the fact that this is a development that is not a small scale business use. The Council also submits, following a proper consideration of the evidence, that I will not be satisfied that the intensity of the development is suitable for the building or that the development will not adversely affect the amenity of the surrounding locality: cl6.13 (3) (b) subclauses (i) and (ii).

38. In determining whether the use of the existing building for a liquor store of the scale proposed is appropriate having regard to the matters pleaded in the contentions (T 21/12p105, 20) the Council submits that I must first determine the meaning of the words “small-sale business uses” in the zone objective at dot point 7.

39. The standard instrument does not define the phrase “small-scale business use” or the words “small scale” or “business”. Therefore, the Council invites me to adopt the ordinary dictionary meanings of the words. Starting with the word “business”, it submits that the dictionary definition is - “the sale of goods in an attempt to make a profit”. It is further submitted that the term “business” incorporates retail and that they are not mutually exclusive. Accordingly, if that is accepted, then the Council submits that it follows the business uses referred to in the objective must include retail and thereby under the LEP definition this shop. Put simply, shops and business uses are not mutually exclusive purposes in the context of the zoning objective under review. The Council submits this interpretation of the meaning of “business uses” is consistent with the reasoning of Leeming J in the Court of Appeal decision in Woolworths, p109 at [10].

37. The Council rejects the proposition put by the applicant in this case (which I will expand upon shortly) that “…the proposal here is not a business use because of reading textually and contextually other objectives in other zones there is a separation between business and retail and community uses for example in the zone B1 neighbourhood centre” (T21/12p106,Ll5-35). In response to this the Council submits:

“…A similar argument was put by the Council in the Court of Appeal in the precursor to these proceedings about contextual matters and where you might look at a zoning table and find the words “commercial premises and registered club” as being in the permissible column of the table they were mutually exclusive. The Court of Appeal said – and it’s dealt with …by Leeming J that contextual and textual argument where there might be a differentiation in the zones and the table relating to the zones between – in that case a registered club and commercial premises, and it was being put that a registered club wasn’t included in a commercial premises because it was separately included in the table, and the Court of Appeal said “No, that’s not necessarily the case”. In this case here, you would give “business” its usual and ordinary meaning as including a premises that sells goods or services in attempts to make a profit, which is precisely the kind of business that is proposed here.”

41. Next, turning to the meaning of “small-scale” in the context of the R3 zoning objective at dot point 7, and again in the absence of a definition in the LEP, the Council submits that “the words are clearly a relative term that requires consideration of where this business would sit in the spectrum of business uses relative to other business uses”. The Council refers the Court to p3 of the letter prepared by Marsdens Law Group dated 24 November 2017 (Exhibit H) forwarded to the applicant’s solicitor in response to a request for particulars including, the Council’s understanding of the meaning of the “small- scale” as referred to in contention 4 C and relies on its contents.

42. Generally speaking, the correspondence (at p3) acknowledges that the LEP does not define the size of any business development with “small –scale”. Therefore, it adopts its ordinary meaning in the context in which it appears. The following definitions of “scale” and “small” found within the Macquarie Dictionary are then set out in the following way:

“scale

9. a certain relative or proportionate size or extent: a residence on a yet more magnificent scale

small

1. on limited size; of comparatively restricted dimensions; not big; little.

3. not large, as compared with other things of the same kind.

7. having only little; land, capital etc. carrying on business on a limited scale; a small investor.

Small scale

2. unambitious, or of small extent, as an enterprize.”

43. Based on those definitions the Council now submits as outlined in Exhibit H that “small-scale” seems to require the subject – whatever the subject is, in this case, business use- to be limited in extent when compared to something else. For present purposes, the Council submits this requires the development to be small when considered in the context of the range of other business or commercial uses in the residential and business zones in the locality. This approach, it is submitted is required in order to try to give it some context and meaning to the term. That said, the Council further submitted that it doesn’t require a consideration of whether the proposal is bigger or smaller than the registered club use that is permitted on the premises. That is not the test. It is to small scale business uses that consideration is required to be given, and the Court must determine whether the business as proposed here is small scale. So, if you are going to have regard to an objective that enables small scale business uses in existing commercial buildings the Council submits that I must give that phrase some meaning.

44. In this case, the Council submits that the business use proposed would not be categorised as being small scale and the following factors support that conclusion. First, there is the size of the floor plate to be used for the business at 980m2, which it is submitted, is significantly larger than the floor plate of most businesses observed in the locality, and within the Business B3 zone nearby including those referred to by Mr McDonald in the joint report which he had opportunity to observe before formulating his evidence (Exhibit 7 at pp 9, 10 at [37]-[38]). The evidence of Mr McDonald in respect of this is set out below:

37. In considering whether the shop is small-scale, it is relevant to consider the size, measured as floor space, as well as the nature of the business, in terms of its likely scale of operation. The proposal is for a shop approximately 990 m² licensed area. The gross floor area (GFA) is greater. From my observation a review of shops in the locality, the floor space will be greater than all other existing shops in the nearby B2 local centre situated at the eastern end of Coogee Bay Road and intersection of Arden Street public reserve fronting quick Coogee Beach…..

38. Within the B2 zone there are approximately 92 shops, cafes and other commercial premises, leading a Woolworths supermarket at the corner of Coogee Bay road and Brook Street. The retail shop in commercial areas of these various businesses varies and I estimate the majority are in the order of 40 -100 m². Some exceptions include the Woolworths, which has a retail shop space estimated to be 650 to 700 m² and a large two-storey gymnasium at 29 to 31 Alfreda Street, opposite Coogee Oval. There are three licensed premises located within the B2 zone that all have substantial floor areas, being the Coogee Bay Hotel on the corner of Coogee Bay Road and Arden Street, the Coogee Bay Palace Hotel on the corner of Dolphin and Beach Streets, and the first floor Coogee Legion Club opposite Coogee Beach at 200 Arden Street. At 224 Coogee Bay Road is a “Little Bottle” bottle shop of the proximally 75 m² retail space. The Coogee Bay Hotel includes a bottle shop fronting Coogee Bay Road of approximately 50 m² retail area and a drive-through bottle shop accessed from Arden Street estimated to be approximately 125 to 135 m² retail shop area.

39. The proposed package liquor shop will be the larger shop in the locality, far exceeding any shops that exist in the established B2 Local Centre zone at Coogee. In addition, in the R3 zone in the locality, there are no other non-residential land uses of anything similar to the size and scale of that proposed.

45. Accepting that Mr McDonald distinguished hotels and gyms from shops in his analysis, the Council submits that I should accept these factual matters - relating to what he observed in this locality in terms of scale or the size of the floor areas at least of other shops - in respect of this issue of scale.

46. The second matter that the Council submits is relevant in considering whether the use is small scale is the traffic evidence about the vehicles generated by the development. Shortly stated, if I accept Mr McLaren’s traffic analysis then I can expect 190 vehicles per hour at peak generated by this development. While Mr Rodgers’ traffic evidence (by reference to the Dan Murphy store in Mosman) is traffic generation in the order of 60 vehicles per hour at peak. That said, whatever way you look at it on either count the Council submits that the total traffic on a peak analysis coming to and from the site would be significantly higher than the businesses in the locality that are identified as shops in the Mr McDonald’s evidence. In particular, with respect to the range of speciality shops which it was assessed would generate in the order of two vehicles per hour per 100m2 of shop. It is submitted that none of these shops surveyed is greater than 100m2 so even assuming 2 vehicles you get maybe 11 vehicles on the weekends or Saturday as compared to the anticipated 60 or 190 vehicles generated by this development. Therefore, in terms of scale the Council submits that this is a relevant matter to consider.

47. The third matter, the Council submits goes to the dictionary definition- comparing the proposed use against other like premises. The Council submits that there are other like premises in the locality – and, based on the evidence of Mr McDonald this shop would be the largest in the locality. It is described as a destination venue in the applicant’s Social Impact Assessment (SIA) dated 9 April 2015 lodged with the DA, with an advertised guaranteed lowest price (Exhibit B Appendix C). So comparing the scale of this facility against other liquor stores, including the one that is said to be replacing BWS with a floor area of 280m2 this proposal at 980m2 is 3.5 times the size of BWS. It is also submitted as relevant the fact that the proposal will provide bulk purchases from the site. In that regard the Council submits it is significantly larger than smaller convenience stores and as a destination store attracts patrons from a wider regional area than smaller convenience stores (Exhibit B Appendix 2).

48. Ultimately, the Council submits on this matter that on balance when regard is had to the zone objectives the scale of the development would weigh heavily against an approval of the application particularly where the building is capable of being used for small-scale business uses based on the evidence of Mr McDonald and Mr Brindle –essentially splitting up the floor space into smaller areas for various uses including shops.

49. With respect to the objective in 6.13 (1) (a) providing for the establishment of small scale business development– the Council submits that the words “small scale business” are used slightly differently. It is small scale business development not uses as found in the zone objective.

50. Despite drawing that distinction, the Council then submits that the word “development” obviously includes use when you look at the definition in s4 of the EPA Act and, in this case the objective contemplates use because it states as much “used in conjunction …dwellings or otherwise”. This is an objective of what this development is seeking to provide for. The Council then submits that it is not an operative provision. The provision doesn’t say that you must consider these objectives. All that the objective is telling you is what the clause intended to provide for and here are the provisions that you need to be satisfied about.

51. That said, when it comes to an interpretation of the provisions in subclause (3) (b) about which the Court needs to be satisfied i.e. adverse effect or what is the intensity of the building that is suitable for the building, then it is submitted that I am entitled to have regard to the objectives as they are relative terms.

52. In relation to the provision in cl6.13 (3) (b) (i) the Council submits that the subclause does not require that I am satisfied that the development will “not unreasonably” adversely affect amenity …” but rather requires that I am satisfied that there is “no adverse effect”. And, after a proper consideration of all of the evidence including that of the objectors regarding traffic congestion and other amenity issues and the social planning evidence (which I will expand upon shortly) the Council submits I cannot be satisfied of the fact that the development will not adversely affect the amenity of the surrounding locality.

53. With respect to whether “the intensity of the development is suitable for the building” in cl 6.13 (3) (b) (ii) again, the Council submitted that this is a relative matter. There is no definition of the word “intensity” in the LEP. In terms of provision the Council submits there are two matters - what is the intensity of the development and what is suitable. In terms of determining whether the intensity of the development is suitable for this building I am directed to have regard to the evidence about the scale of the business use that is proposed. Accepting this business is not a small scale business use, the Council submits I will find that the intensity of the development is not suitable for the building and that the application should be refused because I could not be satisfied of the matters in subclause 3 (b).

The Applicant’s position

54. The applicant submits that the issue of the scale of the proposed development only arises because of the way that the Council is construing the LEP. While all of the zone objectives are relevant for the purposes of consideration, and are important, they only need to be considered as far as they are relevant. With that in mind the applicant submits that the Council in this instance is trying to make the zone objectives an operative control.

55. The parties agree that there are 7 objectives in the R3 zone. The first two relate to housing and therefore are clearly not relevant. The next one is “To enable other land uses that provide facilities or services to meet the day to day needs of residents”. That must include shops and commercial premises and the like, however there is no reference in relation to size. Although the application makes no real change to the external form of the building - to the extent that the development does, it is agreed by the parties that the development does “…recognise the desirable elements of the existing streetscape and built form or, in precincts undergoing transition that contribute to the desired future character of the area”. The objective “to protect the amenity of residents” is relevant but affordable housing is not. And, then,“to enable small –scale business uses in the existing commercial buildings “ What the Council is seeking to do by their construction of this provision is to identify the use separate from the building. The applicant submits that there is no warrant in that last objective dot point 7 to divide from the existing building. To demonstrate the point the applicant submits, for example, if your existing building is 900m2 then if I am putting in an appropriately scaled use in that building an applicant cannot knock out walls between five terrace shops and make one shop because that is not the existing commercial building.

56. The objective is not saying that small scale is numeric; what it is saying is small scale is identified by the size of the building because the Council has gone through in these zones and identified that the existing commercial building should remain in that use, if that is what the owner wants to do. Shortly stated, there is nothing in the LEP or on a proper construction of the objectives or looking at the land uses that requires an existing building for example with an area of 900m2 to be divided up into smaller areas because ultimately, you might end up with a larger commercial use if you have ten shops instead of one.

57. The Council is looking at controlling or identifying in that objective a business use and this application is for a retail use. When looking at construing the LEP it has to be done in the context of the whole LEP. In the B1 Neighbourhood centre zone, the first objective of that zone makes a distinction between retail and business uses. And then in the B2 local centre zone, there is a distinction between retail and business uses. Therefore, it cannot be submitted that the term “business” as used in the R3 objective is intended to encompass what would be generally called “commercial uses” which includes business, retail and the like, but it is intending to distinguish between those two uses.

58. The applicant submits that to the extent that the LEP has an objective it is not an objective in relation to retail. At p92 of the Dictionary in the LEP there is a definition of commercial premises. It means any of the following: business premises, office premises, retail premises. And, while the applicant concedes that they are talking about premises, when you look at the definition of retail premises in the Dictionary of the LEP at p115 it refers to something used for a purpose. Therefore, while the definitions are referring to premises the use is defined.

59. On that basis the applicant contends that this zone objective does not apply and, even if it did, it is appropriate to measure the scale by amenity impact which is one of the other objectives in relation to the existing building. Otherwise there would be a limitation like there is for neighbourhood shops: subclause 7 of cl5.4 of the LEP. In summary, the applicant submits having regard to the objective relied upon by the Council, that you would have regard to it but you would see it as operating as a control on size, intensity or otherwise in relation to this type of use and this type of building.

60. Then dealing with cl 6.13(1) (c) the applicant invites me to note the heading it states: Business Premises, Office Premises, Restaurant or Cafes and Shops in Residential zones. In making this submission the applicant emphasises that in relation to the term small scale, it is identified by references to business, not retail. And again, what it is identifying is an objective which the Court is not required to have regard to under cl2.3 and what it is telling you is this is what the Council is seeking to achieve by its operative provisions: to provide for the establishment and continued operation of something that exists; and to enable the use of existing commercial premises for office premises, business premises and restaurants or cafes and shops in residential zones.

61. The applicant submits that there is no reference to small scale in that objective but there is a specific reference to shops in existing commercial buildings in objective (c): “To provide neighbourhood - scale commercial development to encourage walking and cycling as preferred modes of access”.

62. This objective according to the applicant is concerned about the types of people who will use the development and it is accepted that the patronage of this store will be the neighbourhood. While there may be people who come to Coogee and by association buy a bottle of alcohol, the applicant submits on the evidence that the shop is primarily a local use. The subclause does not require exclusive local patronage.

63. Accepting that subclause (2) of cl6.13 applies, the applicant then turns to subclause (3) (b) – which it submits are the operative provisions.

64. Put simply, the applicant contends that clause 6.13(3) relates to a building that existed when the plan commenced that was designed or constructed for the purpose of commercial premises, and commercial premises are the earlier identified types of uses.

65. This building is 980m2. The Court needs to be satisfied that the development will not adversely affect the amenity of any residential component of the development and the surrounding locality. This amenity ‘goal’ includes the social impact evidence and no other amenity issue is raised by the expert evidence. The police raise no objection in respect of social impact or traffic. The evidence of the traffic engineers is that the roads can accommodate the amount of traffic and the off street parking demand is met by the car park. The heritage officer of the council has addressed heritage issues and accepts the signage is compatible. The acoustic experts in their report are satisfied that there will be no acoustic impact.

66. The next operative provision which I need to be satisfied about is whether the intensity of the development is suitable for the building. The applicant submits this is not referring to the locality of the local government area but only the building. In that regard it is submitted by the applicant that there is no evidence and no suggestion in this case that the building cannot accommodate the intensity of the development.

67. There is a loading dock that will work and provide forward entry and exit. Parking will be accommodated on site. In short there is no other identified impact that comes from the size or intensity of the use, so it could not be suggested that the building was not suitable for the level of intensity. The applicant submits that there is no issue about the degree of modification of the footprint and façade of the building being consistent with the scale and design attributes of the surrounding area – because the applicant is not making any changes in that regard.

54. In the end the applicant submits that what the controls are trying to do is to ensure that what was there remains there and any use that is put in or was there does not have an adverse consequence on the amenity of the neighbourhood. That is what the scale in the objective is talking about. Neighbourhood scale or small scale if it were a business. It is looking at containing it to the existing building and that the applicant submits this is what the applicant has done. On that construction of the LEP the applicant submits that the Council’s case falls away as it is looking at something in terms of small scale and this is not warranted by the LEP.

55. In the alternative, if I accept the Council’s construction of the LEP and the reference to small scale business in both the R3 zone objectives and cl6.13 requiring a consideration of scale then the applicant submits that the floor area comparison approach of Mr McDonald and Mr McLaren’s traffic count approach are inappropriate. As Mr Rodger told the Court when you are looking at scale with respect to traffic issues it goes to more than just numeric calculation. It goes to the time the traffic occurs. Furthermore, this development proposes access to the shop from the rear. The conflict generated by the pedestrian usage associated with the club which required all users of the car park to walk up the driveway to the street and then enter from the street is removed by the proposal. If you were considering scale then this would be relevant to impact. Additionally, the liquor shop is finishing at 10 pm while the club closed at midnight. So in relation to traffic, when you look at the consequences of the numbers of vehicles the increase doesn’t mean that the scale of the impact is unacceptable or not small scale.

56. In relation to the size of the floor area the sheer area does not produce a change in scale of use. The club accommodated 430 patrons plus staff. It operated seven days a week to midnight and later on News Year Eve. The applicant submits that the shop may offer 20 brands of vodka but that does not mean that it is selling 20 bottles to everybody who walks out of the shop. The 980m2 with no impact on the residents in the building who live above is an indication when one looks at scale that it is small. The applicant submits that one might argue that the Woolworths up the street (with a smaller footprint) generates greater consequences according to the residents’ complaints about delivery trucks. So one may say that is a larger scale proposal even though its floor space is smaller.

Finding – construction of the LEP

71. Having considered the parties competing views on this issue, as summarised, I accept the applicant’s construction of the LEP for the following reasons.

72. First, it makes sense as it accords with a plain reading of the words in the context of the whole LEP which is appropriate: Project Blue Sky Inc & Ors V Australian Broadcasting Authority (1998) 194 CLR 355 at [69]. While I accept that all of the zone objectives are relevant for the purposes of consideration, they only need to be considered as far as they are relevant. Having undertaken the requisite consideration of the R3 zone objectives I agree with the applicant that the Council is seeking by its construction of the provisions to identify the use separate from the building. In my assessment, the last zone objective is not saying that small scale is numeric; what it is saying is small scale is identified by the size of the existing building.

73. In my opinion the applicant’s construction of the zone objectives and cl 6.13 (3) (b) is correct as it does not separate the use from the building. The LEP does not require this. Moreover, the applicant’s construction does not import into the LEP words and meanings that are simply not intended. This is an existing commercial building and the proposed shop is permissible with consent in the R3 zone subject to cl 6.13. The Council’s case requires that I accept a construction of the LEP which separately defines words in the LEP by applying an ordinary dictionary meaning – out of context - and then stringing them back together again. This is not an appropriate use of a dictionary to interpret the statutory instrument having regard to the discussion about the role and limitations of dictionaries in House of Peace Pty Ltd & Anor v Bankstown City Council [2000] NSWCA 44 per Mason P at [25]; State Chamber of Commerce and Industry v Commonwealth (1978) 163 CLR 329 at 348.

74. For the reasons articulated by the applicant these are not business premises – they are retail premises – or a shop, on a reading of the LEP in the context of the whole. The last objective of the R3 zone does not apply to this development for that reason. There is no requirement under the LEP to compare this proposal with another shop to appreciate scale. The issue of the scale of the proposed development only arises because of the way that the Council has construed the LEP. The instrument does not require a comparison of liquor stores in the area. Nor does it require a comparison of the floor space of other shops or traffic numbers as presented in the evidence in this case.

75. The existing commercial building does not need to be split up into smaller spaces as cl 6.13 requires consideration of the changes to the footprint and façade of the building. I accept that cl 6.13 is addressing the intensity of the development being suitable for the existing building. At the moment it has a single floor plate.

76. In my opinion the Council’s interpretation of the LEP is very restrictive and constrained construction which is not open on the words. The proposal is for change of use within an existing commercial building to a shop in a residential zone. The objective to be small scale is not relevant to this development. In the present circumstances the use is permissible and in my opinion appropriate for the site in relation to its impacts. I am satisfied that the R3 zone objectives and the provisions of cl 6.13 (3)(b) are met on the evidence.

Social impacts

77. The contention is framed in the following terms “The development application should be refused because the proposed development is likely to have adverse social impacts in the local community”. The parties have provided me with social planning evidence from Dr Alison Ziller and Professor Roberta Ryan. Their joint report is marked Exhibit 6. Helpfully it crystallises the experts’ points of agreement and disagreement in relation to contention 3.

78. Before I address their evidence it is appropriate to record that when addressing the social impacts of a development the Court’s focus is on the environmental and planning consequences as required by the EPA Act. The Court is not looking at whether it is a good idea to sell alcohol. Or, whether people should consume alcohol. Nor is the Court concerned as to whether there is a connection between the consumption of alcohol and health and criminal activity. These are considerations for policy makers.

79. In this case much has been said about the fact that the site abuts an Alcohol Free Zone and is close to several Alcohol Prohibited Zones. The experts have assessed this and reached different conclusions about the appropriateness of the location. Professor Ryan is of the opinion that the location of the store in relation to the nearby AFZ is not likely to have an adverse social impact in the locality. In fact, she tells me that the relevant Guidelines recommend that AFZs should be located adjacent to outlets supplying alcohol where drinkers congregate, subject to some exceptions. And, while it is reported that in the City of Randwick the AFZ areas have been beneficial in respect of the incidence of alcohol related disturbance and crime (Exhibit 6 p2) she reports that the incidents of alcohol related assaults have remained stable in the Coogee suburb over the last five years.

80. Importantly, Professor Ryan is of the opinion that an approval of this liquor store will not increase the number of licensed premises located within or adjacent to the AFZ in Coogee. According to her research of the club premises it has a temporary licence, with the ability for the applicant to seek a non-temporary licence for the use of the site as a club. It is the case that up until 2013 the Club operated and was allowed 430 patrons, trading till 1.30am and it was permitted to sell take away liquor. In her assessment the application does not increase the density of licences in the studied catchment and therefore cannot be demonstrated to increase social impacts (Exhibit 8 p5). And, in her opinion there is no evidence to support the association between the availability of alcohol beverages in stores and drinking at levels associated with harm. With respect to the relationship between price and the impacts of harm she says it is not straightforward and depends on the demographics of the locality.

81. Accepting that the proposed site is within an alcohol related hotspot and a domestic violence hotspot given the status quo of the number of licences and liquor stores is maintained, with no additional packaged liquor establishment created, Professor Ryan is of the expert opinion that the proposed development is not likely to give rise to an increase in alcohol related violence. Professor Ryan has also considered the public submissions made by the residents of the unit complex above the premises which support for the proposal. She notes these positive social impacts of the development. Put simply these local residents are pleased that there will be no parties or noise impact from the use as liquor would not be permitted to be consumed on the premises and the proposal relates to take away liquor and not a nightclub or on premises licence.

82. Professor Ryan records that the original SIA prepared to support the development application was generally positively supported by NSW Police, and Eastern Beaches Local Area Command, indicating no concern with the proposal in relation to the potential impacts on the rates of anti-social behaviour and violence.

83. Dr Ziller takes the opposite view. She is of the opinion that the approval of the store at this site would be inconsistent with prohibited use of alcohol in the immediate area. She is concerned that the supply of liquor will facilitate pre-fuelling and secondary supply in the AFZs and APZs or in areas nearby. However, in expressing these views she concedes that AFZs and APZ are only effective if they are enforced and that they are not effective in themselves. In this case she accepts that the police have raised no complaint about the application for the Dan Murphy in this location. Much of her evidence is predicated on the fact that she believes that the approval of this application will increase the number of liquor stores in the area. The Club stopped trading in 2013 and she does not accept that the Club has a temporary licence or likely to have one easily renewed. While Dr Ziller refers to studies that deal with the correlation between alcohol consumption and domestic violence, the applicant submits the studies she refers to do not make that distinction. They don’t specifically identify that the domestic violence was a consequence of the consumption of alcohol, nor do they distinguish between alcohol consumed at or on premises or a packaged liquor venue. The relevance of these studies on the facts of this case in a planning context is not entirely clear.

Finding – social impact

84. On balance I prefer Professor Ryan’s social impact evidence to that of Dr Ziller in this case. I have formed that view because I think Professor Ryan’s assessment is more objective and balanced. She factored into her assessment of the social impact of the development the particular circumstances of this case including the support for the development expressed by the local police and the residents in the complex above the proposed development. Her frank assessment of the inconclusiveness of academic literature in respect of the correlation between the consumption of alcohol and related violence was balanced. Put simply, there is no evidence in the social impact literature that says that the size of the liquor store has a consequence socially. Rather, the number of shops does. There is no conclusive correlation between domestic violence as a consequence of the consumption of alcohol, or any satisfactory evidence before me to distinguish between alcohol consumed at or on premises or a packaged liquor venue.

85. I also accept Professor Ryan’s expert view that the location of the store in relation to the nearby AFZ is not likely to have an adverse social impact in the locality because it is supported by the relevant AFZ Guidelines. Her analysis that an approval of this application will not increase the number of licensed premises located within or adjacent to the AFZ in Coogee for the reasons she states in her evidence accords with the applicant’s evidence in the case.

86. Finally, I wish to record that I have placed significant weight in my assessment of the application upon the fact that the police have not raised any objection to the proposal. In my view this evidence is compelling in a known alcohol related hot spot. It is also relevant in my assessment that the residents who will reside above the store and who are proximate to any potential anti-social behaviour generated by the use are supportive of the application.

Signage

87. With respect to the signage there are currently three illuminated signs in the horse head and the crest light box on the site. Given that the area opposite is an oval the applicant submits that the amount of light and degree of illumination from the currently approved signage as shown on the plan DA 004 elevation & Section Revision L date d 25 May 2015 is appropriate. There is no neighbour looking onto it and, there is no expert evidence indicating an adverse impact from that perspective.

88. In relation to the signage on the driveway the applicant submits that the distance separation between the windows of that adjoining residence and the proposal as shown the aerial photo in (Exhibit 2) and observed at the site view by the Court is appropriate subject to a condition requiring that the lighting be low level. That said, the applicant indicated if the Court so ordered it would accept a condition for all of the signage to be low level although no amenity evidence supported this. However, it was more concerned with retaining the company’s branding and the words “lowest liquor price guaranteed”. It is submitted that in circumstances where there is no objection from the police and no evidence in the literature or otherwise to suggest that the pricing of liquor as a land use is a matter relevant for consideration under s79C that the branding proposed should be accepted. This case can be differentiated from the facts in the case of Martin Morris & Jones Pty Ltd V Shoalhaven City Council [2012] NSWLEC 1280 (Martin).

89. The council seeks to impose a condition limiting the signage to one business sign on the façade of the existing commercial building identifying the name of the outlet and the company logo without reference to price, discounting or quantity of alcohol sold at the premises (Condition 2 in Exhibit 8). It submits this is in keeping with the character of the area.

Finding – Signage

90. After a consideration of all of the evidence including my observations during the view at the commencement of the hearing I am satisfied that the amount of signage proposed is appropriate. Three signs are already approved on the site and this application does not seek to increase that number.

91. In approving the proposed signage however, I think it is appropriate to impose a condition requiring low level illumination on the driveway sign to address the adjoining neighbour’s concerns as expressed to the Court onsite. The applicant agrees to this. Given that there is an oval opposite the site I accept that the illumination of the signs on the façade of the building will not generate any adverse amenity impact in terms of illumination. It does not need to be low level. The wording of the signage proposed at the front of the building is also acceptable on the evidence before me. Therefore, I authorise the words “lowest liquor price guarantee” which I understand to be part of the applicant’s branding but no other words or claims relating to price discounting or quantity of alcohol sold at the premises is allowed as suggested by the Council’s condition 3 in Exhibit L. This application is distinguished on its facts from the Court’s decision in Martin.

Hours

92. The Council submits on the evidence of Dr Ziller that the hours of operation of the liquor shop should be reduced (p14 Exhibit 6). She is of the view that closing at 8pm has some advantage in terms of social impacts particularly in relation to pre fuelling. The Council points out that there are already two late traders in this location - the Coogee Bay Hotel and another. In essence, the argument is that if the shop closes at 8pm then there is enough time to stop people pre fuelling on cheaper alcohol before they go to the pub and then continue to drink.

93. In response, the applicant submits that the issue of pre fuelling is not related to the sale of packaged liquor. The issue is that someone goes to a hotel and consumes too much alcohol. It is not related to the fact that you’re consuming alcohol at home before you go out. The responsible service of alcohol at the hotel deals with this issue. It’s not related to the sale of pre-packaged liquor.

Finding – hours

94. The applicant seeks approval to trade until 10pm. Based on the evidence I do not believe that this closing time is unreasonable. In that regard I do not accept on the evidence before me that closing the store at 8pm or before 10pm will have any impact on pre fuelling as suggested by the Council’s expert. I accept the applicant’s proposed hours of operation. There is no reasonable basis to reduce them.

Conclusion

95. For the reasons stated I find that there is no satisfactory reason on the evidence to refuse this application on the grounds of traffic, social impact or town planning. With respect to the objectors’ concerns and the public interest more generally I am satisfied that these matters have been appropriately addressed by the expert evidence and the proposed conditions of consent. Accordingly, I have decided to grant development consent to Development Application no 248/2015 for fit out and use of the former Randwick Rugby Club premises as a liquor store (Dan Murphy’s) including signage subject to the imposition of the conditions in Exhibit L as amended by these reasons.

Directions

96. I direct the Council to forward a copy of the agreed terms of the conditions of consent to the Court within 7 days and, if they accord with my reasons I will make final orders in chambers. In the event of disagreement about the terms of the conditions I grant the parties liberty to have the matter relisted before me.

Addendum made on 9 May 2018

97. In accordance with the terms of directions in paragraph [96] of my judgment of 17 April 2018 the parties provided me with the agreed conditions of consent. I am satisfied firstly that consent to the application should be granted, as the appeal is an appeal under s8.7 of the Environmental Planning and Assessment Act 1979, and that the conditions of consent accord with my findings. Accordingly I make orders in chambers as follows:

1. The appeal is upheld.

2. Consent is granted to Development Application no. DA 284/2014 for the development of a Dan Murphy’s retail liquor store on the ground floor of the former Randwick Rugby Club premises being Lot 1 in DP 1050706 known as 102 – 104 Brook Street, Coogee subject to the conditions in Annexure A.

3. The exhibits, other than exhibits A, B, C & 1 are returned.

________________________________

Susan Dixon

Senior Commissioner of the Land & Environment Court

Annexure A (150 KB, pdf)

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Amendments

18 April 2018 - Corrections made to names of experts.

09 May 2018 - Addendum with final orders added.

Decision last updated: 09 May 2018