Land and Environment Court New South Wales Medium Neutral Citation: Pyramid Consulting Pty Ltd v Georges River Council [2022] NSWLEC 141 Hearing dates: 17 November 2022 Date of orders: 17 November 2022 Decision date: 17 November 2022 Jurisdiction: Class 1 Before: Preston CJ Decision: The Court orders: (1) The notice of motion filed 28 October 2022 is dismissed. (2) The conciliation conference listed for 18 November 2022 is vacated. (3) A conciliation conference is listed for 10 February 2023. (4) The appeal is listed for hearing for three days on 19 to 21 April 2023. (5) The parties are to confer and, if possible, agree and file, by 2 December 2022, a statement of facts regarding the development's compliance with the requirements of the Housing SEPP. (6) The respondent is directed to file and serve an amended statement of facts and contentions by 22 December 2022. (7) The applicant is directed to file and serve a reply to the amended statement of facts and contentions (if any) by 3 February 2023. Catchwords: PRACTICE AND PROCEDURE – application for separate question – appeal against refusal of a development application for a boarding house – separate question concerning whether the repealed or current housing State environmental planning policy applies to the development application – determining question separately from other issues not justified – separate identification of relevant matter of environmental planning instrument to be considered in determining development application not appropriate – parties' and objectors' evidence and cases should only address development application on appeal, not potential amended application – adjudication of separate question not just, quick or cheap. Legislation Cited: Environmental Planning and Assessment Act 1979 (NSW), ss 4.12, 4.15, 8.7 Environmental Planning and Assessment Regulation 2000 (NSW), cl 50 Environmental Planning and Assessment Regulation 2021 (NSW), s 37 Land and Environment Court Act 1979 (NSW), s 34 State Environmental Planning Policy (Affordable Rental Housing) 2009 State Environmental Planning Policy (Housing) 2021 Uniform Civil Procedure Rules 2005 (NSW), r 28.2 Cases Cited: Commitment Pty Ltd v Georges River Council (No 2) [2022] NSWLEC 94 Lawson v Minister for Environment and Water (South Australia) and the State of New South Wales [2022] NSWLEC 50 Category: Principal judgment Parties: Pyramid Consulting Pty Ltd (Applicant) Georges River Council (Respondent) Representation: Counsel: Mr T To (Applicant) Ms L Sims (Respondent) Solicitors: Project Lawyers (Applicant) HWL Ebsworth (Respondent) File Number(s): 2022/96931 JUDGMENT 1. Pyramid Consulting Pty Ltd (Pyramid) seeks, by notice of motion, an order under r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) for a question to be heard and decided separately from all other questions in an appeal it has brought before the Court. The appeal is brought under s 8.7 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act), against the deemed refusal of a development application for a boarding house development at 48 Oxford Street, Mortdale. The question that Pyramid seeks to be heard and decided separately concerns the applicable State Environmental Planning Policy against which the proposed development is to be assessed: whether the repealed State Environmental Planning Policy (Affordable Rental Housing) 2009 (ARH SEPP) or the current State Environmental Planning Policy (Housing) 2021 (Housing SEPP). 2. Pyramid designed the proposed development and prepared its development application to conform with the ARH SEPP. Unfortunately for Pyramid, on the day it submitted the development application through the NSW Planning Portal, 26 November 2021, the ARH SEPP was repealed and replaced by the Housing SEPP. There was a savings provision in the Housing SEPP. Section 2(1) of Sch 7A of the Housing SEPP provided that the Housing SEPP did not apply to: "(a) A development application made, but not yet determined, on or before the commencement date." Instead, the provisions of the repealed ARH SEPP continued to apply to such a development application: s 2(2) of Sch 7A. The "commencement date" was 26 November 2021: s 1 of Sch 7A of the Housing SEPP. 3. The question is whether Pyramid's development application is a development application "made, but not yet determined, on or before" 26 November 2021. 4. At the time Pyramid submitted its development application, cl 50 of the Environmental Planning and Assessment Regulation 2000 (NSW) (EPA Regulation 2000), prescribed how a development application must be made. Clause 50 provides, so far as is relevant: "(1) A development application, other than an application for State significant development, must— (a) be in the form that is approved by the Planning Secretary and made available on the NSW planning portal, and (b) contain all of the information that is specified in the approved form or required by the Act and this Regulation, and (c) be accompanied by the information and documents that are specified in Part 1 of Schedule 1 or required by the Act and this Regulation, and (d) be lodged on the NSW planning portal. … (8) The applicant must be notified, by means of the NSW planning portal, that the development application has been lodged. (9) A development application is taken not to have been lodged until the fees notified to the applicant by means of the NSW Planning Portal have been paid." 1. Three of these requirements are of importance. First, a development application must "be lodged on the NSW planning portal" (cl 50(1)(d)). Second, the applicant must be notified, by means of the NSW Planning Portal, "that the development application has been lodged" (cl 50(8)). Third, the development "is taken not to have been lodged" until the applicant pays the fees notified to the applicant by means of the NSW Planning Portal (cl 50(9)). 2. In the present case, Pyramid submitted the development application through the NSW Planning Portal on 26 November 2021, the commencement date for the Housing SEPP. The NSW Planning Portal auto-generated an acknowledgment that the development application had been submitted. The subject heading of the auto-generated email was "New Development Application Submitted PAN-172896". The text of the email included relevantly: "A new application for development at 48 OXFORD STREET MORTDALE 2223 was submitted through the NSW Planning Portal on 26/11/2021 for pre-lodgement review. The Portal Application Number (PAN) for this case is PAN-172896. This is your reference number for viewing the application on the NSW Planning Portal dashboard. Council will review the application and may contact you if additional information is required. Note: the application will only progress to lodgement when all relevant fees are paid. Please log into the NSW Planning Portal to download a copy of the application. Log in You will receive an email notification when your application has been lodged." 1. On the NSW Planning Portal dashboard, which was referred to in the auto-generated email, the development application, with the reference number of PAN-172896, was shown as having the "submitted date" of 26/11/21. 2. A little over two months later, on 2 February 2022, the consent authority for the development application, Georges River Council (the Council), notified Pyramid by means of an email that: "Council has received Development Application for 48 Oxford Street Mortdale. This application has been reviewed and is now ready to be assigned to the relevant officer. To ensure that the application progresses, payment must be made within 2 days. If payment is not received, the application will not proceed." 1. The email attached a "Quote Estimate" of $10,934.78, which was the fee notified to Pyramid. On 4 February 2022, Pyramid paid the fee notified by the Council for the development application. 2. The question for determination is whether, on these facts, Pyramid's development application can be said to have been made on or before 26 November 2021. If so, the Housing SEPP would not apply but instead the ARH SEPP would continue to apply to the development application. If not, the Housing SEPP would apply instead of the ARH SEPP. 3. The Council contended that an applicant makes an application for development consent when it applies to a consent authority for consent to carry out development. A person applies for consent under s 4.12(1) of the EPA Act and in accordance with the regulations. Clause 50 of the EPA Regulation 2000 prescribes how a development application is made. The Council contended that a development application is not made until there is substantial compliance with each of the requirements in cl 50(1) of the EPA Regulation 2000. In this case, the Council contended that Pyramid's development application was not made on 26 November 2021 as each of the requirements for making a development application in cl 50(1) had not been met at that time. 4. In particular, the development application had not been "lodged on the NSW planning portal" as required by cl 50(1)(d). By dint of cl 50(9) of the EPA Regulation 2000, the development application was taken not to have been lodged until the fees notified to Pyramid had been paid. This did not occur until 4 February 2022. Hence, the Council argued, Pyramid's development application was lodged on the NSW Planning Portal on 4 February 2022. Only on that date was there compliance with the requirements in cl 50(1), such that the development application was made on that date. 5. The Council contended that this Court's decision in Commitment Pty Ltd v Georges River Council (No 2) [2022] NSWLEC 94, concerning a savings provisions contained in a different environmental planning instrument, supported finding that Pyramid's development application had not been made until the fee had been paid. The mere submission of a development application through the NSW Planning Portal is insufficient in order for the development application to be made. 6. Pyramid contested the Council's construction of the savings provision in cl 2 of Sch 7A of the Housing SEPP. Pyramid pointed to the distinction between a development application being "made" in the savings provision in cl 2 of Sch 7A of the Housing SEPP and a development application being "lodged" in cl 50 of the EPA Regulation 2000. Pyramid submitted that this choice of different language was deliberate, with the consequence that a development application could be made before it is lodged. 7. Pyramid submitted that in this case, its development application was made when it was submitted through the NSW Planning Portal on 26 November 2021, but it was not lodged until 4 February 2022 when Pyramid paid the fees notified to it. For the purpose of the savings provision, however, it was sufficient that the development application was made on 26 November 2021, even though it was not lodged until 4 February 2022. 8. Pyramid submitted that it wished to distinguish the decision in Commitment Pty Ltd v Georges River Council (No 2), as that case dealt with a savings provision in a different environmental planning instrument to the savings provision in cl 2 of Sch 7A of the Housing SEPP. Alternatively, Pyramid said it wished to submit that the decision was wrongly decided. 9. Pyramid therefore disputed the Council's contention that its construction and application of the savings provision in cl 2 of Sch 7A of the Housing SEPP was not reasonably arguable. 10. The critical issue raised by the notice of motion is whether Pyramid should be allowed to argue the question of the construction of the savings provision, and hence the applicable SEPP, separately from all other questions in the proceedings. 11. Pyramid pointed out the importance of this question of the applicable SEPP to its appeal. As I have noted, the development proposed in the development application was designed to conform to the requirements of the ARH SEPP. The Housing SEPP and the ARH SEPP differ significantly in their respective treatment of boarding houses. Pyramid's solicitor, Mr Hanna, identified in his affidavit affirmed on 28 October 2022 the differences between the ARH SEPP and the Housing SEPP of relevance to the proposed development: State Environment Planning Policy (Housing) 2021 (Housing SEPP) State Environment Planning Policy (Affordable Rental Housing) 2009 (ARH SEPP) Floor Space Ratio Floor Space Ratio The Housing SEPP provides an additional 25% of the maximum permissible floor space for a boarding house: clause 24(2)(a). The ARH SEPP provided additional floor space, expressed as an additional floor space ratio of 0.5:1 if the existing maximum floor space ratio was 2.5:1 or less: clause 29(1)(c) of ARH SEPP. In the present case, the maximum FSR would be 1.25:1. In the present case, the maximum FSR is 1.5:1. The proposed development has a FSR of 1.46:1, exceeding both the maximum 1:1 FSR under the Georges River Local Environmental Plan 2021, and 1.25:1 under the Housing SEPP. As the development is, under the Housing SEPP, not a 'boarding house' (see below), the bonus floor space under the Housing SEPP is not available. The proposed development has a FSR of 1.46:1 and is compliant with the floor space ratio provided under the ARH SEPP. As a clause 4.6 request has not accompanied the development application, the application is presently incapable of approval. Permissibility and Application of the Housing SEPP Permissibility and Application of the Housing SEPP The introduction of the Housing SEPP was accompanied by an amendment to the definition of 'boarding house' in the Standard Instrument, such that it is a part of the definition that the boarding house be managed by a registered community housing provider. The ARH SEPP made permissible 'boarding houses' as the term was defined in the Standard Instrument. The proposed development does not propose management by a registered community housing provider and is not permissible as a 'boarding house' for the purposes of the Housing SEPP. The proposed development is a 'boarding house' as defined for the purposes of the ARH SEPP. A boarding house is required, in perpetuity, to be used for affordable housing (meaning it is subject to a form of rent control): clause 26(1). The ARH SEPP did not impose any requirement restricting its use in perpetuity. The ARH SEPP did not require any form of means testing of occupants or rent control. Minimum lot size Minimum lot size The Housing SEPP imposes a minimum lot size development standard of 800sqm for land not in a R2 zone: clause 25(1)(g) of the Housing SEPP. The ARH SEPP did not prescribe any minimum lot size requirement. The Site (which is zoned R4) has a size of approx. 512sqm, and cannot comply. Building Separation Building Separation The Housing SEPP requires mandatory consideration whether a boarding house complies with the building separation distances specified in the Apartment Design Guide: clause 25(2). The ARH SEPP did not specify any development standard for, or otherwise require, specified building separation distances. The applicable separation distance is 6m. The proposed development provided setbacks of 1.5m, with design elements avoiding or mitigating potential privacy impacts. The proposed development does not comply and (with a total site width of approx. 14m) cannot practically comply. Communal living area and Communal open space Communal living room and Private open space The Housing SEPP requires a specific area of communal living area, proportionately increasing with the number of boarding rooms: clause 24(2)(g). The ARH SEPP required at least one communal living room (without a prescriptive requirement of size) for a boarding house of 5 or more boarding rooms: clause 30. The proposed number of boarding rooms results in a requirement for 72m2 of communal living area within the development. The proposed development includes one communal living room of approx. 15 sqm and complies with the requirements of the ARH SEPP. The proposed development does not comply. The Housing SEPP requires a minimum area of communal open space of 20% of the site area: clause 24(2)(h). The ARH SEPP required a minimum of 20sqm of private open space (meaning open space available for occupants of a boarding house): clause 29(2)(d). The required communal open space for the site is 102.46sqm. The proposed development provides 92sqm of private open space, complying with the ARH SEPP. The proposed development does not comply. 1. The consequence of the significant differences in treatment of boarding houses between the ARH SEPP and the Housing SEPP is that the Court is unlikely to be able to grant development consent to the development application that is the subject of the appeal if the Housing SEPP were to apply instead of the ARH SEPP. The development proposed in the development application before the Court fails to meet too many of the requirements of the Housing SEPP in order for the Court to have power to grant development consent for that development. The development would have to be altered in fundamental respects in order to comply with the Housing SEPP before the Court would have power to grant development consent. 2. No application has yet been made to amend the development application before the Court to modify the development to better conform with the requirements of the Housing SEPP. Pyramid foreshadowed that it would wish to consider making such an application to amend the development application if the Court were to find that the applicable SEPP is the Housing SEPP rather than the ARH SEPP. But the case it wishes to run now is that development consent should be granted to the development that is proposed in the current development application, which conforms to the ARH SEPP. 3. Pyramid submitted that the separate determination of the question of which of the ARH SEPP or the Housing SEPP applies would save time and cost in that the parties would not have to run alternative cases contingent on the application of each SEPP. For example, Pyramid submitted, if a separate question were not to be ordered, expert witnesses called by the parties would need to prepare alternative sets of evidence: one on the basis that the ARH SEPP applies and the other on the basis that the Housing SEPP applies. Having alternative cases would make both the conciliation conference arranged under s 34 of the Land and Environment Court Act 1979 (NSW), and the hearing if the conciliation fails, more complex. The participation by objectors would be more difficult as they too would need to address both possibilities of the ARH SEPP and the Housing SEPP applying. 4. I am not persuaded to order that the question of which SEPP, either the ARH SEPP or the Housing SEPP, applies in the adjudication of Pyramid's appeal, for three main reasons. 5. First, it is ordinarily appropriate that all questions in proceedings be heard and determined at the one time: Lawson v Minister for Environment and Water (South Australia) and the State of New South Wales [2022] NSWLEC 50 at [14]. This is especially important with an appeal under s 8.7(1) of the EPA Act against the determination of a consent authority of a particular development application seeking consent to carry out a particular development. The Court on appeal re-exercises the power of the consent authority under s 4.16(1) of the EPA Act to determine the development application that is the subject of the appeal. The Court's determination of the appeal under s 8.7 of the EPA Act and its exercise of the power under s 4.16 of the EPA Act turn on the particular development application before the Court and the particular development for which consent is sought in that application. The Court's exercise of the power under s 4.16 of the EPA Act to grant development consent will not be valid unless it constitutes the grant of "consent to the application" that was made to the consent authority and is the subject of the appeal to the Court: Ku-ring-gai Council v Bunnings Properties Pty Ltd (2019) 236 LGERA 35; [2019] NSWCA 28 at [202]. That is not to say that the development application made to the consent authority cannot be amended – it can under s 37 of the Environmental Planning and Assessment Regulation 2021 (NSW) – but it is to say that consent can only be granted to the development application, amended or unamended, that is the subject of the appeal. 6. Pyramid's development application seeks consent for a boarding house development that has been designed to conform to the ARH SEPP, not the Housing SEPP. That explains the fundamental differences between the proposed development and the requirements of the Housing SEPP, which I have earlier identified. 7. It is this development, which is the subject of the development application and the appeal, that the Court is to assess under s 4.15(1) of the EPA Act. This will involve taking into consideration the provisions of any environmental planning instrument of relevance to the development: s 4.15(1)(a)(i) of the EPA Act. This requires identifying which environmental planning instruments are relevant. This is a standard requirement in the assessment of all development applications. The present case throws up a particular identification exercise, whether the relevant environmental planning instrument is the ARH SEPP or the Housing SEPP, but this does not take the identification exercise out of the ordinary assessment required by s 4.15(1)(a)(i) of the EPA Act. It certainly does not by itself warrant ordering that the question of which environmental planning instrument is relevant be heard and determined separately from other questions in the proceedings, including the question of what other matters may be of relevance to the development the subject of the development application that are to be taken into consideration under s 4.15(1) of the EPA Act. 8. Second, the spectre of the parties, experts and objectors having to prepare their cases, evidence and submissions on alternative bases is imaginary. There is only one development application before the Court, and only one development for which consent is sought in that development application. That is a development designed to conform to the ARH SEPP, not the Housing SEPP. The parties, experts and objectors need only address that development application and that development. 9. Pyramid, as the applicant, needs to adduce such evidence and make such submissions as will establish its case: that the Court should grant consent to the development application before the Court. This will involve endeavouring to establish that the relevant environmental planning instrument is the ARH SEPP and adducing evidence to establish that the proposed development accords with the ARH SEPP and is otherwise acceptable to be approved. 10. The Council, as the respondent, needs to adduce such evidence and make such submissions as will establish its case: that the Court should refuse consent to the development application before the Court. This will involve endeavouring to establish that the relevant environmental planning instrument is the Housing SEPP and adducing evidence to establish that the proposed development is in breach of the requirements of the Housing SEPP and is otherwise unacceptable to be approved. 11. The objectors need to address in their submissions why the Court should refuse consent to the development application before the Court, including addressing the applicable SEPP and the development's compliance with that SEPP. 12. In none of these cases will the parties or objectors need to address a development application or a development that is not before the Court. Evidence cannot be adduced concerning any potential amended development application seeking consent for a development that might better accord with the requirements of the Housing SEPP. That development application and development is not presently before the Court. 13. Hence, the parties, experts and objectors cannot run alternative cases contingent on the application of one or other of the ARH SEPP or the Housing SEPP – they can only run a case addressing the development application and the development before the Court. 14. Third, the ordering of a separate question will not facilitate the just, quick and cheap resolution of all questions in the proceedings. The determination of the question of which SEPP applies will not be dispositive of the proceedings. The Court's answering of the separate question simply does that – the Court cannot go on to dispose of the appeal without determining all other questions in the proceedings. In contrast, if the Court were to hear and determine all questions in the appeal, the Court could dispose of the proceedings finally. Indeed, making orders for the decision of the question separately from other questions in the appeal may increase the delay and cost of the appeal. 15. If the Court were to answer the separate question by identifying the ARH SEPP as the applicable environmental planning instrument, as Pyramid contends, the Court could not go on at that time to hear and determine the other questions in the appeal, as they are not listed for hearing. Instead, the matter would need to be returned to the list and allocated another hearing at a later date, perhaps many months away, at which time the remaining questions would need to be heard and determined. This delay, additional hearing and attendant costs would be avoided if all questions were listed for hearing at the one time. The Court could decide all questions and dispose of the appeal in one judgment. 16. Alternatively, if the Court were to answer the separate question by identifying the Housing SEPP as the applicable environmental planning instrument, as the Council contends, the Court also could not go on at that time to dispose of the proceedings. The only question listed for determination would be the separate question; all other questions would need to be heard and determined at a later time. The Court could not dispose of the proceedings without a hearing and determination of the other questions. 17. Pyramid, as the applicant, could agree to the Court disposing of the proceedings without hearing and determining the other questions, but this is unlikely as Pyramid has foreshadowed that it would wish to consider applying to amend the development application to modify the development to better accord with the requirements of the Housing SEPP that the Court would have found to be applicable. The Court may or may not grant Pyramid leave to amend the development application – it will depend on the nature and extent of the modifications of the development sought, amongst other factors. But any such application to amend and, if leave be granted to amend, the parties' preparation for and conduct of the hearing of their cases on the amended development application, will increase the delay and cost of the proceedings. 18. Again, this delay, additional hearing and attendant costs would be avoided if all questions were listed for hearing at the one time. The appeal against the consent authority's determination to refuse consent to the current development application before the Court would be disposed once and for all. Such final disposition of the appeal would not prevent Pyramid from submitting a new development application seeking consent for an amended boarding house development that better conforms with the requirements of the Housing SEPP. The Council, as consent authority, could determine that new development application. If it refuses consent, Pyramid could appeal to this Court. The Court can adjudicate this fresh appeal, determining whether consent should be granted to the new development application for the modified development. This is the appropriate forum for determining whether consent should be granted to the modified development, not the forum of the current appeal concerning a different development. 19. For these reasons, I am not persuaded that it is appropriate to order a separate question. Instead, the appeal should be fixed for hearing, at which time all questions in the appeal should be determined. 20. It will be appropriate to direct the Council to amend its statement of facts and contentions to better identify the real issues in the proceedings. The Council's primary contention is that consent must be refused because the development does not comply with the requirements of the Housing SEPP. In the alternative, if the ARH SEPP were to apply, the Council may wish to identify any merit issues as to why the development, which conforms to the ARH SEPP, should be refused. 21. Although the parties' different constructions of the savings provision and hence which SEPP applies would likely preclude the parties reaching agreement at a conciliation conference, there still may be utility in arranging a conciliation conference in order to narrow the merit issues in the proceedings concerning the development's compliance with the ARH SEPP or other statutory instruments. The conciliation conference scheduled for tomorrow should be vacated and a new date arranged. 22. The hearing of the appeal should be listed before a judge or a legally qualified Commissioner to decide the question of the construction of the savings provision and the applicable SEPP, as well as the other issues raised in the proceedings. 23. The Court orders that: 1. The notice of motion filed 28 October 2022 is dismissed. 2. The conciliation conference listed for 18 November 2022 is vacated. 3. A conciliation conference is listed for 10 February 2023. 4. The appeal is listed for hearing for three days on 19 to 21 April 2023. 5. The parties are to confer and, if possible, agree and file, by 2 December 2022, a statement of facts regarding the development's compliance with the requirements of the Housing SEPP. 6. The Council is directed to file and serve an amended statement of facts and contentions by 22 December 2022. 7. The applicant is directed to file and serve a reply to the amended statement of facts and contentions (if any) by 3 February 2023. ********** 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: 29 November 2022