Land and Environment Court New South Wales Medium Neutral Citation: Natale and Greenhalgh v The Council of the City of Sydney [2022] NSWLEC 1556 Hearing dates: Conciliation conference on 22 June and 16 August 2022 Date of orders: 13 October 2022 Decision date: 13 October 2022 Jurisdiction: Class 1 Before: Sheridan AC Decision: The Court Orders that: (1) The appeal is upheld. (2) Development consent is granted to Development Application No. D/2021/1326 for the partial demolition of the existing building, substantial alterations and additions to the existing building to accommodate commercial office tenancies, construction of a three-storey addition for residential use and new lower basement including basement carparking at 42 Hardie Street, Darlinghurst, subject to the conditions set out in Annexure 'A'. (3) The Applicant is to pay the Respondent's costs thrown away pursuant to section 8.15(3) of the Environmental Planning and Assessment Act 1979 agreed in the sum of $5,000. Catchwords: DEVELOPMENT APPEAL – commercial premises and shop top housing – conciliation conference – agreement between the parties – orders Legislation Cited: Environmental Planning and Assessment Act 1979 ss 4.15, 4.16, 8.7, 8.15 Environmental Planning and Assessment Regulation 2000 cl 55 Land and Environment Court Act 1979 s 34 State Environmental Planning Policy (Building Sustainability Index: BASIX) 2004 State Environmental Planning Policy (Resilience and Hazards) 2021, cl 4.6 Sydney Local Environmental Plan 2012 cll 4.3, 4.4, 5.10, 5.21, 6.21C, 7.14 Cases Cited: Idolbox Pty Ltd v City of Sydney Council [2020] NSWLEC 1213 Category: Principal judgment Parties: Gregory Natale (First Applicant) Jason Greenhalgh (Second Applicant) City of Sydney Council (Respondent) Representation: Counsel: A Whealy (Solicitor) (Applicants) M Flick(Solicitor) (Respondent) Solicitors: Mills Oakley Lawyers (Applicants) City of Sydney (Respondent) File Number(s): 2022/69060 Publication restriction: No Judgment 1. COMMISSIONER: These proceedings relate to an appeal to the Land and Environment Court (Court) pursuant to s 8.7(1) of the Environmental Planning and Assessment Act 1979 (EPA Act) against the deemed refusal of Development Application No. D/2021/1326 by the Council of the City of Sydney (the Council). In exercising the functions of the consent authority on the appeal, the Court has the power to determine the DA pursuant to ss 4.15 and 4.16 of the EPA Act. 2. The site, subject of the Development Application is legally described as Lot 1 in Deposited Plan 997066, otherwise known as 42 Hardie Street, Darlinghurst (the Site). The Site currently accommodates a two-storey car repair shop. 3. On 15 May 2022, the Land and Environment Court granted consent to Development Application No. D/2017/1606 for alterations and additions to the existing building for the construction of a part 4, part 5 and part 6 storey mixed use development containing basement storage and services, ground floor retail space and seven residential apartments at the Site (Idolbox Pty Ltd v City of Sydney Council [2020] NSWLEC 1213). 4. On 12 November 2021, the Development Application D/2021/1326 (the DA), subject of this appeal was lodged with the Respondent. The DA as amended seeks consent for partial demolition of the existing building, substantial alterations and additions to the existing building to accommodate commercial office tenancies, construction of a three-storey addition for residential use, and new lower basement including for basement carparking at 42 Hardie Street, Darlinghurst. 5. The DA was notified by the Respondent between 24 January 2022 to 22 February 2022. A total of three (3) submissions were received in response to the notification. The amended application was renotified between 1 July 2022 to 18 July 2022. 6. The Court arranged a conciliation conference under s 34(1) of the Land and Environment Court Act 1979 (LEC Act) between the parties, which was held on 22 June 2022 and 16 August, at which I presided. During conciliation, amended plans (the Amended Development Application) were prepared by the Applicant to address the Council's contentions. 7. The main changes between the plans as originally submitted to Council and the Amended Development Application, the subject of the s 34 agreement, are: 1. Revised Internal Lift/Stair Core layout; 2. Pump Room relocated from Hardie Street to Hayden Place-rear lane; 3. Revised layout for common hallway, waste facilities, and fire egress; 4. Vertical Blades to Hardie Street façade; 5. Revised Planter box layout; 6. Lift overrun and air conditioning units to be enclosed in louvres; and 7. Removal of rooftop privacy screen. 1. During the conciliation conference, the parties reached an agreement as to the terms of a decision in the proceedings that would be acceptable to the parties. This decision involved the Court upholding the appeal and granting development consent to the development application subject to conditions. 2. A signed agreement prepared in accordance with s 34(10) of the LEC Act was filed with the Court on 26 August 2022. 3. The parties ask me to approve their decision as set out in the s 34 agreement before the Court. In general terms, the agreement approves the development subject to amended plans that were prepared by the Applicant, noting that the final detail of the works and plans are specified in the agreed conditions of development consent annexed to the s 34 agreement. 4. 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 power under s 4.16 of the EPA Act. 5. In this case, there are jurisdictional prerequisites that must be satisfied before this function can be exercised. The jurisdictional prerequisites of relevance in these proceedings, and how they are satisfied, are set out in [13] – [19] below. Satisfaction of jurisdiction 1. The relevant jurisdictional matters in relation to the Sydney Local Environmental Plan 2012 (SLEP) are: 1. Development for the purpose of commercial premises and residential accommodation/shop top housing is permitted with consent in the B4 Mixed Use zone under the SLEP. 2. The Site is subject to a maximum height of buildings control of 18m pursuant to cl 4.3 of the SLEP. The DA complies with this control (refer DA.410 – Height Plane – Rev G – 29 June 2022). 3. The Site is subject to a maximum floor space ratio ('FSR') control of 3:1 pursuant to cl 4.4 of the SLEP. The DA complies with this control (refer DA.090 – GFA Calculation Schedule – Rev G – 29 June 2022). 4. The Site is not a heritage item, but it is located within a heritage conservation area and within proximity to the Sydney Jewish Museum and other heritage items on Victoria Street. The Court has considered the effect of the proposed development on the heritage significance of the heritage item pursuant to cll 5.10(4) and (5) of the SLEP and is satisfied that the proposal as amended does not adversely affect the conservation area or heritage items (refer to Heritage Impact Assessment, prepared by Zoltan Kovacs Architect dated July 2021). 5. The Site is not identified as being within a flood planning area. Accordingly, cl 5.21 of the SLEP is not enlivened by the DA. 6. Under cl 6.21C of the SLEP, the proposal as amended is considered to demonstrate design excellence in terms of the matters raised subcl (2) and I am satisfied that: * the proposal as amended exhibits a high standard of architectural design and materials; * the proposal as amended will improve the quality and amenity of the public domain; * the proposal as amended will not have a detrimental impact on view corridors; and * the proposal as amended provides an adequate response to the heritage issues and streetscape constraints. 1. Pursuant to Div 7 of the SLEP, the Site is nominated as Category B land on the Land Use and Transport Integration Map. The Site is nominated as Category F on the Public Transport and Accessibility Map. A maximum of 2 parking spaces are proposed consistent with these provisions. 2. The Site is not identified as being within a Class 5 acid sulfate soil area. Accordingly, cl 7.14 of the SLEP is not enlivened by the DA. State Environmental Planning Policy (Resilience and Hazards) 2021 ('SEPP Resilience and Hazards') 1. Clause 4.6 of the SEPP Resilience and Hazards requires that a consent authority must not grant consent to any development on land unless it has considered whether a site is contaminated land or potentially contaminated land, and if it is, that it is satisfied that the land is suitable (or will be after undergoing remediation) for the proposed use. 2. The Detailed Site Investigation prepared by SLR dated 27 August 2019 and filed with the subject Class 1 Application ('DSI') identified three contaminants exceeding the sites adopted investigation criteria. It recommended that the site be remediated under a remediation action plan and concluded that there is a high likelihood that the Site can be made suitable for its proposed mixed commercial and residential use through the implementation of the applicable remedial measures. 3. The contamination and remediation of the site was subject to detailed assessment under the appeal proceedings of the existing consent (D/2017/1606). A Remedial Action Plan was prepared by the applicant's contaminant consultant (SLR Consulting Pty Ltd) and a letter of Interim Audit Advice by a NSW Environment Protection Authority accredited Site Auditor. 4. These documents were reviewed and accepted by the respondent's Environmental Health Unit and informed the conditions of consent for the previous consent (D/2017/1606) including the staging of works and compliance with the remediation actions identified. The conditions referred to are to be reimposed under the current proposal to ensure that the site contamination is appropriately managed and remediated through construction, as per Condition 2 and Condition 52 of the agreed conditions of consent. 5. I am therefore satisfied of the matters set out in cl 4.6 of the SEPP Resilience and Hazards has been adequately addressed. State Environmental Planning Policy (Building Sustainability Index BASIX) 2004 1. An updated BASIX Certificate has been provided for the proposed development. In combination with the conditions of consent this satisfies the requirements of the SEPP BASIX. Conclusion 1. As the parties' decision is a decision that the Court could have made in the proper exercise of its functions, I am required under s 34(3) of the LEC Act to dispose of the proceedings in accordance with the parties' decision. 2. In making the orders to give effect to the agreement between the parties, I was not required to, and have not, made any merit assessment of the issues that were originally in dispute between the parties. Notes 1. The Court notes that: 1. The Council of the City of Sydney, as the relevant consent authority, has agreed under clause 55 of the Environmental Planning and Assessment Regulation 2000 to the Applicant amending Development Application No. D/2021/1326 to rely on the documents referred to at Annexure "B". 2. The amended application as described at Annexure B was lodged on the NSW Planning Portal on 29 June, 8 July and 1 July 2022. 3. The Applicant subsequently filed the amended application with the Court on 24 August 2022. 4. The Respondent's Statement of Reasons for entering this agreement are attached at Annexure "C". Orders 1. The Court orders that: 1. The appeal is upheld. 2. Development consent is granted to Development Application No. D/2021/1326 for the partial demolition of the existing building, substantial alterations and additions to the existing building to accommodate commercial office tenancies, construction of a three-storey addition for residential use and new lower basement including basement carparking at 42 Hardie Street, Darlinghurst, subject to the conditions set out in Annexure 'A'. 3. The Applicant is to pay the Respondent's costs thrown away pursuant to section 8.15(3) of the Environmental Planning and Assessment Act 1979 agreed in the sum of $5,000. ………………………. L Sheridan Acting Commissioner of the Court ******** Annexure A Annexure B Annexure C 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: 13 October 2022