Woolworths Ltd v Caboolture Shire Council and the Warehouse Group (Australia) Pty Ltd; Woolworths Ltd v Caboolture Shire Council and Makro Warehouse Pty Ltd

[2004] QPEC 26

PLANNING & ENVIRONMENT COURT
OF QUEENSLAND

CITATION:

Woolworths Ltd v Caboolture Shire Council & The Warehouse Group (Australia) Pty Ltd;

Woolworths Ltd v Caboolture Shire Council & Makro Warehouse Pty Ltd [2004] QPEC 026

 PARTIES:

WOOLWORTHS LIMITED
ACN 000 014 675
Applicant
v
CABOOLTURE SHIRE COUNCIL
First Respondent
and
THE WAREHOUSE GROUP (AUSTRALIA) PTY LTD ACN 003 038 702
Second Respondent

WOOLWORTHS LIMITED
ACN 000 014 675
Applicant
v
CABOOLTURE SHIRE COUNCIL
First Respondent
and
MAKRO WAREHOUSE PTY LTD
ACN 087 578 578

Second Respondent

FILE NO:

2346/2003; 3465/2003

DIVISION:

Planning & Environment Court

PROCEEDING:

Application

ORIGINATING COURT:

Planning & Environment Court of Queensland, Brisbane

DELIVERED ON:

17 June 2004

DELIVERED AT:

Brisbane

HEARING DATE:

28 May 2004

JUDGE:

Alan Wilson SC, DCJ

ORDER:

1. In each application it is declared that the second      respondent has started assessable development (being a new use characterised under the Planning Scheme for the Shire of Cabooltulture as a “shop”) on land situated at 312-344 Morayfield Road, Morayfield without a Development Permit for the development;

2.     In each application it is declared that the second
       respondent has and is continuing to unlawfully use
       premises at the subject site for a shop use;

3.     In each application I order that the second respondent
        cease the use of the subject site as a shop unless and
       until a Development Permit for such use is obtained;

4.     In each application the operation of the order in (3)
       above is suspended for a period of three months from
       the date of this order.

CATCHWORDS:

PLANNING AND ENVIRONMENT – DECLARATIONS AND ENFORCEMENT ORDERS – enforcement orders imposed – whether orders ought to be postponed to allow respondents to regularise breaches – factors relevant to the discretion

Integrated Planning Act 1997 ss 4.1.21, 4.3.25

Cases considered:

Beswicke v Alner (1926) VLR 72, 76

Graham v KD Morris & Sons Pty Ltd (1974) Qd R 1

NRMCA (Qld) Ltd v Andrews (1991) QPLR 267

NRMCA (Qld) Ltd v Andrew (1993) 2 Qd R 706
Queensland Cement Limited v United Global Cement Pty Ltd [1999] QPELR 167

Warehouse Group (Australia) Pty Ltd v Woolworths Ltd (2003) NSWCA 270
Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335

Westfield Management Ltd v Pine Rivers Shire Council & The Warehouse Group, unreported (Britton SC, DCJ),
Toowoomba, 26 March 2004

Woolworths Ltd v Caboolture Shire Council & Ors [2004] QPEC 015
Woolworths Limited v The Warehouse Group (Australia) Pty Ltd (2003) LGERA 341

COUNSEL:

Mr D Gore QC and Mr J Houston for the applicant in each matter
Mr C Hughes SC and Mr B Job for the second respondent in each matter;
Mr MJ Quirk, solicitor, for the first respondent in each matter

SOLICITORS:

Mallesons Stephen Jaques for the applicant in each matter
King & Co for the first respondent in each matter
Deacons for the second respondent in each matter

1. The applicant in both these proceedings (“Woolworths”) sought declaratory relief and consequential enforcement orders against the second respondent in each (“The Warehouse” and “Makro”) on the grounds both had begun operating stores at Caboolture in circumstances where their use of the premises was assessable development, but that use had commenced without the necessary Development Permit from the local authority.  The cases were heard together and on 7 May 2004 this court published Reasons for Judgment in which it expressed its satisfaction that the applicant had established grounds for the relief sought, but acceded to the respondents’ request that they have the opportunity to be heard on the width of the orders.

1. Further evidence and submissions were received on 28 May 2004.  The second respondents accept the findings of the court and acknowledge that, if they are to continue to trade in their present fashion, they are obliged to seek approval from the Council.  Each also acknowledged that appropriate declarations about their previous unlawful trading should be made and restraining orders imposed but contended that, upon the giving of necessary undertakings by them, those orders ought to be suspended for a period of nine months so that they might pursue the necessary town planning approvals.  Woolworths opposed any suspension or postponement.

1. It is appropriate to shortly re-state the circumstances relevant to this court’s previous decision.  Both The Warehouse and Makro were, it was found, trading as “shops” (as that word is defined under the Caboolture Planning Scheme) without the necessary permission, in large premises in a new shopping complex at Morayfield Road, Caboolture.  The Warehouse commenced to operate in about mid-2002, and Makro around June 2003.  In the latter month Woolworths wrote to The Warehouse and the Council drawing attention to the breach of the Planning Scheme and in the following month commenced proceedings.  Another warning letter was sent to Makro, and proceedings commenced against it in October 2003.  The applications were heard together at the end of January 2004, and Reasons were delivered on 7 May, in which it was said of the respondents:

“Their activities are a clear and significant breach of the relevant terms of the Planning Scheme and it is ultimately for the local authority to decide whether or not they should be permitted.  The applicant has, I am satisfied, established grounds for injunctive relief.”[1]

[1]Woolworths Ltd v Caboolture Shire Council & Ors [2004] QPEC 015, at paragraph [42]

1. Each party filed further affidavits before the most recent hearing.  Mr Andrews, General Manager of the Warehouse Group said it had retained a town planner to begin the process of applying for development approval, but it would otherwise take about ten weeks to reorganise The Warehouse to extinguish the present, offending conduct.  He also said it was not possible to predict whether the store could continue to trade economically when that was done and, unless any restraining orders are suspended while the Development Application is pursued, there is a real risk The Warehouse will be obliged to close.  Mr Tranent, the local manager of the Caboolture Warehouse said it employed 54 people, most of them working part-time and unlikely to find other employment easily in the Caboolture area if the store closes.  Mr Murphy, the owner of the centre in which The Warehouse is situated says the other tenants depend heavily upon The Warehouse and Makro; in total, those tenants employ about 70 people; and, the loss of the “anchor” tenants (The Warehouse, and Makro) even for a temporary period would have “significant detrimental effects on the other tenants’ businesses and may well force some of them to cease trading altogether”. 

1. Evidence of a similar kind was adduced for Makro, which employs 73 staff of whom 22 are employed full time, and 51 on a casual basis.  Mr Kumskov, the town planner retained by Makro (and The Warehouse) filed an affidavit explaining the steps involved in the applications the respondents must make for Development Permit for a Material Change of Use which would permit them to continue trading in their present fashion and said that, even if the applications were pursued diligently, the procedure would take “at least nine months”.  Finally, an officer of Caboolture Shire Council, Ms Dryden, filed an affidavit in the application against The Warehouse in which she said that the applications proposed by each respondent “… would take approximately six to nine months to process”. 

1. Against this Mr Dimasi, a retail economics consultant who had given evidence for the applicants at the original hearing, expressed the opinion that the respondents could adjust their trading arrangements and store setups in less than ten weeks, and should not require more than six; and, some of the employees may have the opportunity to relocate to other stores operated by the respondents.

1. Spry suggests[2] that an injunctive order should only be suspended in “special” or “very exceptional” circumstances, and the principle has been applied by the Victorian Full Court[3] and the Queensland Supreme Court[4].  It seems unlikely, however, that it should be extended to an application of this kind, for the suspension of an Enforcement Order made under the Integrated Planning Act 1997 (IPA), s4.3.25. It works against the application of such a principle that the initial discretion to grant or refuse injunctive relief is a wide one[5]. 

   [2] 6^th Edition (2001) page 403

   [3]Beswicke v Alner (1926) VLR 72, 76

   [4]Graham v KD Morris & Sons Pty Ltd (1974) Qd R 1, at 5, 7

   [5]NRMCA (Qld) Ltd v Andrew (1993) 2 Qd R 706, at 713 (CA)

1. That width explains, at least in part, what Robin QC, DCJ has described as the “tender attitude”[6] sometimes shown in this jurisdiction in proceedings for enforcement orders, which may even extend to the granting of a postponement of the kind sought here: in Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335, Kirby P said at 340-341:

“The wide discretion has been described as ‘an adequate safeguard against abuse of a salutary procedure”:  see Menzies J in Cooney v Ku-ring-gai Municipal Council (1964) 114 CLR 582 at 605; (1963) 9 LGRA 290 at 306. It permits the court to soften, according to the justice of particular circumstances, the application of rules which, though right in the general, may produce an unjust result in the particular case. Sometimes this ‘softening’ can be achieved by postponing the effect of injunctive relief:  see, eg, Woollahra Municipal Council v Carr” (my emphasis)

[6]Queensland Cement Limited v United Global Cement Pty Ltd [1999] QPELR 167, at 175

1. The IPA provisions relating to the discretion were set out by Robin QC, DCJ in Queensland Cement: sections 4.3.25, .26, and .27. His Honour said of them[7]:

“… the following provisions … appear to indicate considerable relaxation of the traditional requirements for the granting of injunctive relief, and a limiting or qualification of the effective circumstances which would lead to traditional injunctive relief being refused …”

[7]Queensland Cement, at 170

1. That is not to say the jurisdiction is toothless, or that it will always be construed in a manner sympathetic to those who breach the planning laws.  As his Honour also remarked[8], there will be cases in which it is “…inappropriate in the circumstances to order any such general suspension, which would render the applicant’s success entirely nugatory.”  In Warringah v Sedevcic, Kirby P said at 339-340:

“In exercising the discretion, it must  be kept in mind that the restraint sought is not, in its nature, the enforcement of a private right, whether in equity or otherwise.  It is the enforcement of a public duty imposed by or under an Act of Parliament, by which Parliament has expressed itself on the public interest which exists in the orderly development and use of the environment … there is indicated a legislative purpose of upholding, in the normal case, the integrated and coordinated nature of Planning law.  Unless this is done, equal justice may not be secured.  Private advantage may be won by a particular individual which others cannot enjoy.”(my emphasis)

[8] At 176

1. In a recent decision[9] this court, confronted by very similar issues, was initially persuaded to postpone the imposition of the Enforcement Order for three months and, later, for a further six months.  The principal reasons for the postponement involved findings that a failure to suspend the operation of the restraining order would cause hardship to The Warehouse, its employees and members of the public.  Support for the proposition that a restraining order could properly be suspended was found in the decision of the Queensland Court of Appeal in NRMCA (Qld) Ltd v Andrew (1993) 2 Qd R 706 (CA).  The respondents here also relied upon that decision in which the Court[10] said, at 713:

“In some circumstances at least it will be proper to treat as weighing against the grant of an injunction that efforts are being made so to arrange matters that the illegality is brought to an end by the grant of the appropriate consent. 

Of course, the judge might well have taken the view that, in a case of this sort, it is appropriate to grant an injunction suspended for a suitable period, rather than to refuse one altogether – the period being calculated to give a reasonable time to pursue an application for consent …”

[9] Westfield Management Ltd v Pine Rivers Shire Council & The Warehouse Group, unreported (Britton SC,    DCJ, Toowoomba, 26 March 2004)

[10] Macrossan CJ, Pincus and Davies JJA

1. As Mr Gore QC for the applicant showed, however, an analysis of the primary decision and that of the Court of Appeal reveals the remarks in the second paragraph were, in fact, obiter.  At first instance Quirk DCJ[11] had been asked to restrain the respondents from using land for the purpose of a concrete batching plant.  The plant had been operating for some 3½ years; there was no evidence that any member of the community was suffering any direct detriment as a consequence of the activities surrounding it; and, the primary judge felt it was noteworthy that there were ongoing negotiations between the respondent and the local authority which were “harmonious”.  His decision to refuse injunctive relief in those circumstances was appealed by the applicant at first instance, but the Court of Appeal was not persuaded the discretion had miscarried.  The remarks which appear at 713, set out above, are no more than expressions of approval of the way in which the primary judge exercised his discretion and, at the highest, an ancillary comment on an alternative which might have been open to him – but, importantly, his failure to consider or adopt that alternative approach involved no error.  It cannot be said, then, that the remarks lay the foundation for a general rule, to be applied in circumstances where some hardship might arise. 

   [11]NRMCA (Qld) Ltd v Andrews (1991) QPLR 267

1. Indeed some of the decisions already mentioned suggest hardship may, in some circumstances, be a factor to which little weight is given.  In NRMCA v Andrew Quirk DCJ said, at 270:

“I am less impressed with the complaints of hardship suffered by the respondents.  It would seem to me somewhat inappropriate for a court to take into account, in favour of a respondent, loss of benefits from an activity which is clearly contrary to law.”

The Court of Appeal decision contains no criticism of that statement, and the matter was also given little weight in Queensland Cement[12].  Robin QC, DCJ considered the possibility of lost profits as a consequence of a restraining order as a “minor factor” where the respondents had begun to operate without appropriate planning approvals and, with respect to possible hardship to employees, said:

“The situation of employees, particularly those who are permanent who may have given up other employment in the expectation of secure new employment, commands sympathy. It is a factor, but in the circumstances should not be a decisive one.  If those employees were as fully informed as the court, they might well have appreciated that the future of the second respondent’s new business, in competition with the established major players, might be uncertain.”

[12] At 175

1. It is clear that much will depend upon the particular circumstances of each case.  That conclusion accords with the remarks of Kirby P in Warringah Shire Council v Sedevcic (supra) at 339:

“It is undesirable to endeavour, by drawing upon decisions in differing fact situations which have presented in earlier cases, to attempt to catalogue or classify all of the circumstances which will enliven the exercise of the discretion in cases yet to come.  By the statute, the discretion is not fettered.  It is not limited either to particular classes of case or to limited or special cases …”

These remarks were primarily addressed, of course, to the question whether injunctive relief should be imposed at all but, as Kirby P went on to explain at 341 (in the passage set out earlier) they can also apply to the nature of the injunctive relief, and conditions it may be appropriate to attach to it. 

1. The Warehouse and Makro each offer undertakings to make, and diligently pursue, an appropriate Development Application for approval to regularise their activities, as a condition to be attached to suspension of the restraining orders for a period of, say, nine months or until further order.  Mr Hughes SC advanced five grounds said to warrant a suspension on those terms: that there are least reasonable prospects his clients would obtain the necessary development approvals; that there is no evidence of any serious public harm arising from their activities, or any serious harm being caused to the applicant; that the respondents and their staff and customers would suffering varying degrees of loss, detriment and inconvenience; and, that the responsible local government does not contend that the restraining orders should not be stayed.  In oral argument, he submitted the prospect of hardship to employees, and the other tenants in the shopping centre were the most telling of these factors[13].

   [13] T 9.27-37 (28 May 2004)

1. It would not be proper for this court to conjecture about the respondents prospects of success in the Development Approvals it intends presenting to the local authority, for obvious and cogent reasons.  The matter is entirely one for the local authority and there is a possibility of embarrassment, on all sides, if this court says anything which might signify a pre-judgment of a matter presently entirely outside its bailiwick.  There is also a risk the applications might ultimately come back before this court, compounding the embarrassment.  In Westfield Management[14] the court declined to make any finding as to prospects in very similar circumstances, although Britton SC, DCJ was prepared to take into account, as a relevant fact, that it could not be argued that there were no prospects.   Here, the applicant’s town planner Mr Buckley thought there was in fact a strong case for refusal and that an application may well be futile[15].  The fact a contrary view is possible cements the need to avoid all comment. 

   [14] (unreported Britton SC, DCJ, 26 March 2004)

   [15] T 55.8-12,19-27; and, T 47.7-88 (28 January 2004)

1. It is possible to conceive circumstances in which the matter might be relevant (for example, if the local authority appeared and signified an intention to consider approval sympathetically) but, here, the Council did no more than announce its ongoing willingness to abide the order of the court[16].  The present circumstances dictate, then, that it is a matter which should be ignored.  Similarly the last of the respondents’ contentions – the absence of opposition to a suspension from the local authority – seems in light of Council’s announced position to be, at the highest, a factor which is simply neutral and not something which sounds in the respondents’ favour.

   [16] T 3.37 (28 May 2004)

1. The question of harm to the public interest generally, or the applicant in particular is not to be considered solely by reference to past, present or potential customers of either of the respondent stores, local residents, or the applicant or its customers.  Rather, those issues fall to be contemplated within a wider ambit - the obligation to obey the law.  As Lloyd J said in a case between the same parties, and involving similar issues, Woolworths Limited v The Warehouse Group (Australia) Pty Ltd (2003) LGERA 341, at 348:

“I do not accept the submission, however, that there is an absence of harm arising from the use of the premises.  The public detriment is not confined to physical or economic harm.  It includes the broader interest in securing obedience to the planning laws.  Unless restrained, a breach in one case leads to breaches in others and to a general feeling that the law is being ignored when breached by those who persistently flout it.  In such a situation, the applicant in the present case, Woolworths Limited, would be justified in believing that whilst it must itself comply with the planning laws, others do not have to comply – there would no longer be a level playing field, upon which fair competition relies.”

1. Statements to similar effect were made on appeal in that case: Warehouse Group (Australia) Pty Ltd v Woolworths Ltd (2003) NSWCA 270, Foster AJA saying at pp 12-13:

“…planning law is of considerable importance.  Obviously, both the zoning and the relevant conditions were intended to achieve a public purpose of considerable significance, being orderly town planning and the implementation of government policy in this regard.  The breaches by the appellant, if allowed to continue, would, in effect, nullify the relevant zoning.  It would, in my view, have been entirely inappropriate that the infringing use be allowed to continue … the business must be conducted in accordance with the relevant zoning …”

1. Some other circumstances in this case mean this matter of general hardship, in the wider sense of lost profits or inconvenience to the public, ought not be construed in a way favourable to the respondents.  First, while the town planning issues are not strongly adverse to them, and may even be construed as supportive, there was no evidence from them about the investigations, if any, they made before either set up in business, or what advice they obtained about the lawfulness of the use they proposed.  Indeed, it was found that their original applications to the local authority failed to properly describe the nature and extent of the goods to be sold at their premises[17].  Secondly, unlike the position in Queensland Cement, the respondents here have not been actively pursuing the appropriate town planning consents[18]. 

   [17]Reasons for Judgment, para 41

   [18]Supra, at 174

1. Other cases (some of them already mentioned) show the respondents cannot have been unconscious of the possibility of conflict between their proposed activities, and the Caboolture Planning Scheme[19].  These circumstances make it inappropriate for the respondents to attempt to rely upon hardship of this kind and, whatever the nature of that hardship, mean it would always be subsumed (so far as the discretion is concerned) in this case to the more important principle of upholding planning law.

   [19]   Woolworths v The Warehouse Group (Australia) Pty Ltd (2003) 123 LGERA 341; on appeal 2003 NSWCA 270; Westfield Management Ltd v Pine Rivers Council and The Warehouse Group (Australia) Pty Ltd, unreported (Britton SC, DCJ, 14 November 2003), 1627/2003; Woolworths v The Warehouse Group (Australia) Pty Ltd & Anor (2003) NSWLEC 350

1. The question of possible harm to the respondents’ employees, and co-tenants and their employees, is more vexing.  Their circumstances, as Robin QC, DCJ said in Queensland Cement “command sympathy”[20].  This factor influenced the court in Westfield Management v Pine Rivers Shire Council, where it was described as “significant”[21].  I accept that unemployment is relatively high in the Caboolture area[22], and that the immediate enforcement of the injunctive orders will involve quite significant changes to each of the respondents’ stores, and attract a risk of closure.  I also accept that the application process will take, realistically, about nine months or more.  Mr Dimasi’s opinion that employees may have the opportunity to relocate[23] is possibly unrealistic when many of the employees are part-time, and (it may safely be assumed) not highly paid.  He also thought the respondents’ stores could be re-organised in a period of about six weeks but that is essentially conjectural, and I prefer the evidence of the respondents’ managers that ten weeks is a more reliable estimate[24].  The possibility that the jobs of up to 200 people are jeopardised is not to be taken lightly. 

   [20]Supra, at 175

   [21] 

   [22]Affidavit Tim Stork, filed 25 May 2004 (3645/2003)

   [23]Affidavit Anthony Demasi, filed 27 May 2004 (2346/2003) para 8

   [24]Affidavit Timothy Andrews filed 27 May 2004 (2346/2003) para 15

1. The factors central to the discretion here are, then, the need to uphold planning law and the risk of hardship to innocent parties.  The first factor has inherent within it, as the cases show, the applicant’s right to a judgment which is not rendered nugatory by conditions from which it could reasonably be inferred that parties can flout planning law without fear of repercussion.  The second involves appropriate concern for the well-being of those who are likely to be the innocent victims of each respondent’s unlawful conduct.  A proper balancing of these competing elements points strongly to the conclusion that the respondents should be allowed some time to reorganise their affairs in a manner which militates, to some extent, against hardship to those persons, and enhances the prospect of mitigating that hardship; but, at the same time, the period must not be so long as to invite the conclusion that parties can ignore planning laws with impunity. 

1. On any view, that analysis does not suggest it is an appropriate exercise of the discretion to allow the respondents a lengthy period of nine months in which they might attempt to repair their unlawful conduct.  Postponement for that period or anything like it carries a clear but, for the reasons set out above, entirely inappropriate message that serious breaches of planning laws may attract no sanction.  At the same time, a suspension which allows the respondents’ employees, and co-tenants and their workers, the opportunity to consider their positions and make whatever changes or adjustments are appropriate without immediacy or urgency should serve to have some ameliorating effect on personal hardship.  A period of three months meets the conflicting demands of these contingencies.

1. The appropriate orders are, then:

(a)        In each application it is declared that the second respondent has started assessable development (being a new use characterised under the Planning Scheme for the Shire of Caboolture as a “shop”) on land situated at 312-344 Morayfield Road, Morayfield without a Development Permit for the development;

(b)        In each application it is declared that the second respondent has and is continuing to unlawfully use premises at the subject site for a shop use;

(c)        In each application I order that the second respondent cease the use of the subject site as a shop unless and until a Development Permit for such use is obtained;

(d)        In each application the operation of the order in (c) above is suspended for a period of three months from the date of this order.

Westfield Management Ltd v Pine Rivers Shire Council & The Warehouse Group (Australia) Pty Ltd, 
     unreported (Britton SC, DCJ, 26 March 2004, 1627/2003) at T 12.33 (Transcript  26 March 2004)