Land and Environment Court New South Wales Medium Neutral Citation: HSN Construction Pty Ltd v Waverley Council [2022] NSWLEC 1077 Hearing dates: Conciliation conference on 9 - 10 February 2022 Date of orders: 14 February 2022 Decision date: 14 February 2022 Jurisdiction: Class 1 Before: O'Neill C Decision: The orders of the Court are: (1) The Applicant is to pay the Respondent's costs thrown away as a result of the amendment of the application, pursuant to s 8.15(3) of the Environmental Planning and Assessment Act 1979, in the sum of $7,500 within 28 days of these orders. (2) The appeal is upheld. (3) Development Application No. 152/2021 for the demolition of existing structures and construction of three storey residential flat building with basement parking at 154 Ramsgate Avenue, North Bondi, is approved, subject to the conditions of consent at Annexure A. Catchwords: DEVELOPMENT APPLICATION –– construction of a residential flat building ––condition of consent requiring a planning agreement for a monetary contribution –– conciliation conference –– agreement between the parties –– orders made Legislation Cited: Environmental Planning and Assessment Act 1979 ss 4.6, 8.7 Land and Environment Court Act 1979 ss 34, 39 State Environmental Planning Policy (Affordable Rental Housing) 2009 Part 3 State Environmental Planning Policy (Building Sustainability Index: BASIX) 2004 cl 6 State Environmental Planning Policy (Housing) 2021 Sch 7 Waverley Local Environmental Plan 2012 cll 4.3, 4.4, 4.6 Cases Cited: Four2Five Pty Ltd v Ashfield Council [2015] NSWLEC 90 Initial Action Pty Ltd v Woollahra Municipal Council (2018) 236 LGERA 256; [2018] NSWLEC 118 RebelMH Neutral Bay Pty Limited v North Sydney Council [2019] NSWCA 130 Wehbe v Pittwater Council (2007) 156 LGERA 446; [2007] NSWLEC 827 Texts Cited: Waverley Planning Agreement Policy 2014 Category: Principal judgment Parties: HSN Construction Pty Ltd (Applicant) Waverley Council (Respondent) Representation: Counsel: M Parrino (Solicitor) (Applicant) S. Patterson (Solicitor) (Respondent) Solicitors: Project Lawyers (Applicant) Wiltshire Webb Staunton Beattie Lawyers (Respondent) File Number(s): 2021/185466 Publication restriction: No Judgment 1. COMMISSIONER: This is an appeal pursuant to the provisions of s 8.7(1) of the Environmental Planning and Assessment Act 1979 (EPA Act) against the refusal of Development Application No. 152/2021 for the demolition of existing structures and construction of a three storey residential flat building with basement parking (the proposal), at 154 Ramsgate Avenue, North Bondi (the site), by Waverley Council (the Council). 2. The application was amended on 27 January 2022 to rely on the documents listed at condition 1 of the conditions of consent (Annexure A), with the consent of the Council, and the amended application was uploaded on the NSW planning portal. The amended application was filed with the Court. 3. The Court arranged a conciliation conference under s 34 of the Land and Environment Court Act 1979 (LEC Act) between the parties, which was held on 9 February 2022. I presided over the conciliation conference. 4. At the conciliation conference, the parties reached agreement as to the terms of a decision in the proceedings that would be acceptable to the parties. 5. Under s 34(3) of the LEC Act, I must dispose of the proceedings in accordance with the parties' decision if the parties' decision is a decision that the Court could have made in the proper exercise of its functions. The parties' decision involves the Court exercising the function under s 4.16 of the EPA Act to grant consent to the development application. 6. There are preconditions to the exercise of power to grant development consent for the proposal pursuant to cl 4.6(2) of the Waverley Local Environmental Plan 2012 (LEP 2012). Planning framework 1. The site is zoned R3 Medium Density Residential pursuant to LEP 2012 (Land Zoning Map – Sheet LZN_004). The objectives of the R3 zone, to which regard must be had, are: • To provide for the housing needs of the community within a medium density residential environment. • To provide a variety of housing types within a medium density residential environment. • To enable other land uses that provide facilities or services to meet the day to day needs of residents. • To maximise public transport patronage and encourage walking and cycling. 1. The height of buildings development standard for the site is 9.5m (cl 4.3 and Height of Buildings Map Sheet HOB_004 of LEP 2012). 2. The Floor Space Ratio (FSR) development standard for the site is 0.6:1 (cl 4.4 and FSR Map Sheet FSR_004 of LEP 2012). The site and the proposal 1. The site has an area of 477.5m2 and a frontage to Ramsgate Avenue of 12.19m. The site contains a three storey residential flat building with a hipped roof comprising 6 apartments. 2. The proposal is for a three storey residential flat building over basement parking for 5 cars, accessed from Ramsgate Avenue. The proposal is for three x 3 bedroom apartments. 3. The proposal includes a BASIX certificate, pursuant to State Environmental Planning Policy (Building Sustainability Index: BASIX) 2004, as the proposal is BASIX affected development under cl 6. 4. The agreed conditions of consent include a requirement for the Applicant to enter into a planning agreement with the Council for the provision of a monetary contribution, in accordance with Waverley's Planning Agreement Policy 2014, prior to the issue of a construction certificate (condition 8 of the conditions of consent at Annexure A). Contravention of the Height of Buildings development standard 1. The maximum height of the proposal is 10.5m. 2. The Applicant provided a written request seeking to justify the contravention of the height of buildings development standard prepared by Urbis and dated 25 January 2022. 3. Clause 4.6(4) of LEP 2012 establishes preconditions that must be satisfied before a consent authority or the Court exercising the functions of a consent authority can exercise the power to grant development consent (Initial Action Pty Ltd v Woollahra Municipal Council (2018) 236 LGERA 256; [2018] NSWLEC 118 at [13] ("Initial Action")). The consent authority must form two positive opinions of satisfaction under cl 4.6(4)(a). As these preconditions are expressed in terms of the opinion or satisfaction of a decision-maker, they are a "jurisdictional fact of a special kind", because the formation of the opinion of satisfaction enlivens the power of the consent authority to grant development consent (Initial Action at [14]). The consent authority, or the Court on appeal, must be satisfied that the Applicant's written request has adequately addressed the matters required to be addressed by cl 4.6(3) and that the proposed development will be in the public interest because it is consistent with the objectives of the contravened development standard and the zone, at cl 4.6(4), as follows: (4) Development consent must not be granted for development that contravenes a development standard unless: (a) the consent authority is satisfied that: (i) the applicant's written request has adequately addressed the matters required to be demonstrated by subclause (3), and (ii) the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out, and (b) the concurrence of the Secretary has been obtained. 1. On appeal, the Court has the power under cl 4.6(2) of LEP 2012 to grant consent to development that contravenes a development standard without obtaining or assuming the concurrence of the Secretary of the Department of Planning and Environment, pursuant to s 39(6) LEC Act, but should still consider the matters in cl 4.6(5) (Initial Action at [29]). The Applicant's written request to contravene the height of buildings development standard 1. The first opinion of satisfaction required by cl 4.6(4)(a)(i) of LEP 2012 is that the Applicant's written request seeking to justify the contravention of a development standard has adequately addressed the matters required to be demonstrated by cl 4.6(3) (see Initial Action at [15]), as follows: (a) that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case, and (b) that there are sufficient environmental planning grounds to justify contravening the development standard 1. The Applicant bears the onus to demonstrate that the matters in cl 4.6(3) of LEP 2012 have been adequately addressed by the written request in order to enable the Court, exercising the functions of the consent authority, to form the requisite opinion of satisfaction (Initial Action at [25]). The consent authority has to be satisfied that the Applicant's written request has in fact demonstrated those matters required to be demonstrated by cl 4.6(3) and not simply that the Applicant has addressed those matters (RebelMH Neutral Bay Pty Limited v North Sydney Council [2019] NSWCA 130 at [4]). 2. The common ways in which an Applicant might demonstrate that compliance with a development standard is unreasonable or unnecessary are summarised by Preston CJ in Wehbe v Pittwater Council (2007) 156 LGERA 446; [2007] NSWLEC 827 [42]-[51] ("Wehbe") and repeated in Initial Action at [17]-[21]: 1. the objectives of the development standard are achieved notwithstanding non-compliance with the standard; 2. the underlying objective or purpose of the development standard is not relevant to the development, so that compliance is unnecessary; 3. the underlying objective or purpose would be defeated or thwarted if compliance was required, so that compliance is unreasonable; 4. the development standard has been abandoned by the council; 5. the zoning of the site was unreasonable or inappropriate so that the development standard was also unreasonable or unnecessary (note this is a limited way of establishing that compliance is not necessary as it is not a way to effect general planning changes as an alternative to strategic planning powers). 1. The five ways to demonstrate compliance is unreasonable/unnecessary are not exhaustive, and it may be sufficient to establish only one way (Initial Action at [22]). 2. The Applicant's written request justifies the contravention of the height of buildings development standard on the basis that compliance is unreasonable or unnecessary because the objectives of the development standard are achieved, notwithstanding non-compliance with the standard. 3. The grounds relied on by the Applicant in the written request under cl 4.6 must be "environmental planning grounds" by their nature, and environmental planning grounds is a phrase of wide generality (Four2Five Pty Ltd v Ashfield Council [2015] NSWLEC 90 at [26]) as they refer to grounds that relate to the subject matter, scope and purpose of the EPA Act, including the objects of the Act (Initial Action at [23]). The environmental planning grounds relied upon must be sufficient to justify contravening the development standard and the focus is on the aspect of the development that contravenes the development standard, not the development as a whole (Initial Action at [24]). Therefore, the environmental planning grounds advanced in the written request must justify the contravention of the development standard and not simply promote the benefits of carrying out the development as a whole (Initial Action at [24]). 4. The written request identifies the environmental planning ground as the natural topography of the site, which includes fall of approximately 7.1m from Brighton Boulevard (east) to Ramsgate Avenue (west). The fall of the site results in a sloping height plane. The proposal responds this constraint by stepping the built form on the western side. A small part of the uppermost level on the western end exceeds the height of buildings development standard. 5. I am satisfied, pursuant to cl 4.6(4)(a)(i) of LEP 2012, that the Applicant's written request has adequately addressed the matters required to be demonstrated by cl 4.6(3). The Applicant's written request defends the exceedance of the height of buildings development standard as a justified response to the constraint of the fall of the site. I am satisfied that justifying the aspect of the development that contravenes the height of buildings development standard can be properly described as an environmental planning ground within the meaning identified by his Honour in Initial Action at [23]. Whether the proposal is in the public interest because it is consistent with the objectives of the contravened development standard and the zone 1. The second opinion of satisfaction in cl 4.6(4)(a)(ii) is that the proposed development will be in the public interest because it is consistent with the objectives of the development standard that is contravened and the zone objectives. The consent authority must be satisfied that the development is in the public interest because it is consistent with these objectives, not simply that the development is in the public interest (Initial Action at [27]). The consent authority must be directly satisfied about the matters in cl 4.6(4)(a)(ii) (Initial Action at [26]). 2. The Applicant justifies the exceedance of the height of buildings development standard with the following: * The proposal is predominately compliant and below the maximum height. * The proposal has reduced the overall height of the development when compared to the existing development. * The building envelope of the proposal maintains or improves the amenity of surrounding development, including solar access and views. * The proposal is consistent with the three storey scale of development envisaged for this locality. * The massing of the building envelope of the proposal maintains the established rhythm, setbacks and scale of contemporary development in Ramsgate Avenue. 1. I am satisfied that the proposal will be in the public interest because it is consistent with the objectives of the development standard and the R3 zone, for the reasons given by the Applicant in the written request. Contravention of the FSR Development Standard 1. The proposal has a FSR of 0.94:1. 2. The Applicant provided a written request seeking to justify the contravention of the FSR development standard prepared by Urbis and dated 25 January 2022. 3. The Applicant's written request justifies the contravention of the FSR development standard on the basis that compliance is unreasonable or unnecessary because the objectives of the development standard are achieved, notwithstanding non-compliance with the standard. 4. The written request identifies the environmental planning ground as the natural topography of the site, which includes fall of approximately 7.1m from Brighton Boulevard (east) to Ramsgate Avenue (west). The fall of the site results in the basement being accessed at the footpath level on Ramsgate Avenue and being two storeys below natural ground level at the eastern end of the basement. The proposal has a rear setback 5.575m at the subterranean basement level, and a rear setback of 8.8m for the uppermost two levels, visible above ground at the rear of the site. 5. I am satisfied, pursuant to cl 4.6(4)(a)(i), that the Applicant's written request has adequately addressed the matters required to be demonstrated by cl 4.6(3). The Applicant's written request defends the exceedance of the FSR development standard as a justified response to the constraint of the fall of the site and the location of the basement. I am satisfied that justifying the aspect of the development that contravenes the FSR development standard can be properly described as an environmental planning ground within the meaning identified by his Honour in Initial Action at [23]. 6. The Applicant justifies the exceedance of the FSR development standard with the following: * The extent of excavation proposed is required to accommodate the on-site parking. * The rear portion of the ground floor apartment, over the basement level, is located below the natural ground level as a result of the slope of the land and does not contribute to the bulk of the building envelope visible above natural ground level. * The building envelope of the proposal maintains or improves the amenity of surrounding development, including solar access and views. * The proposal is consistent with the three storey scale of development envisaged for this locality. * The massing of the building envelope of the proposal maintains the established rhythm, setbacks and scale of contemporary development in Ramsgate Avenue. 1. I am satisfied that the proposal will be in the public interest because it is consistent with the objectives of the development standard and the R3 zone, for the reasons given by the Applicant in the written request. State Environmental Planning Policy (Affordable Rental Housing) 2009 (SEPP ARH ) 1. State Environmental Planning Policy (Housing) 2021 (SEPP Housing) commenced on 26 November 2021. The former provisions of State Environmental Planning Policy (Affordable Rental Housing) 2009 (SEPP ARH) apply to a development application made, but not yet determined, on the commencement date (Sch 7 to SEPP Housing). The application was lodged on 28 April 2021. 2. The existing development on the site is a residential flat building that has not been strata subdivided. Part 3 of the SEPP ARH, Retention of existing affordable rental housing, applies to the proposal at cl 49. In determining a development application to demolish the existing building, the consent authority is to take into account the guidelines and the matters listed under cl 50(2) of SEPP ARH. The application includes a Housing Report prepared by Urbis (the Urbis Report) which provides an assessment of the guidelines and the matters listed under cl 50(2) of SEPP ARH. The Council submitted that the Urbis Report demonstrates that the proposal does not result in the loss of affordable housing and therefore no contribution for affordable housing is required. Orders 1. The orders of the Court are: 1. The Applicant is to pay the Respondent's costs thrown away as a result of the amendment of the application, pursuant to s8.15(3) of the Environmental Planning and Assessment Act 1979, in the sum of $7,500 within 28 days of these orders. 2. The appeal is upheld. 3. Development Application No. 152/2021 for the demolition of existing structures and construction of three storey residential flat building with basement parking at 154 Ramsgate Avenue, North Bondi, is approved, subject to the conditions of consent at Annexure A. ………………………… Susan O'Neill Commissioner of the Court (Annexure A) (442092, pdf) ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 February 2022