Peden v Lake Macquarie City Council [2024] NSWLEC 87
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Land and Environment Court
New South Wales
Medium Neutral Citation: Peden v Lake Macquarie City Council [2024] NSWLEC 87
Hearing dates: 19 August 2024
Date of orders: 19 August 2024
Decision date: 20 August 2024
Jurisdiction: Class 4
Before: Pepper J
Decision: See orders at [33] and [34].
Catchwords: JUDICIAL REVIEW: validity of modification development consent – whether the development modified substantially the same – applicable legal principles – development as modified not substantially the same development – respondents restrained from acting upon the modified development consent.
COSTS: whether respondents to pay the applicant's costs where respondents filed submitting appearances – applicable legal principles – costs order made against consent authority up to the date of filing submitting appearance.
Legislation Cited: Civil Procedure Act 2005, ss 56-60
Environmental Planning & Assessment Act 1979, ss 4.15, 4.55
Lake Macquarie Local Environmental Plan 2014
Cases Cited: Arrage v Inner West Council [2019] NSWLEC 85
Canterbury-Bankstown Council v Realize Architecture Pty Ltd [2024] NSWLEC 31
Feldkirchen Pty Ltd v Development Implementation Pty Ltd [2022] NSWCA 227; (2022) 254 LGERA 114
Fitter v Public Trustee [2007] NSWSC 1487
Inglis v Buckley (No 2) [2023] NSWLEC 113
LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12; (2024) 98 ALJR 610
Moto Projects (No 2) Pty Ltd v North Sydney Council [1999] NSWLEC 280; (1999) 106 LGERA 298
Rossi v Living Choice Australia Ltd [2015] NSWCA 244
Sader v Elgammal (No 3) [2024] NSWLEC 35
Steinhoff Australia Pacific Ltd v Lifestyle Retailing Pty Ltd [2011] NSWSC 1621
Trust Co of Australia Ltd v Perpetual Trustee WA Ltd (No P2) (1995) 36 NSWLR 654
Woollahra Municipal Council v Cameron (No 2) [2024] NSWLEC 66
Texts Cited: Lake Macquarie Development Control Plan 2014
Category: Principal judgment
Parties: Ryan Peden (Applicant)
Lake Macquarie City Council (First Respondent)
Ian Paver (Second Respondent)
Prudence Paver (Third Respondent)
Representation: Counsel:
M Hall SC with M McGrath (Applicant)
Solicitors:
SWS Lawyers (Applicant)
Matthews Folbigg Pty Ltd (First Respondent, submitting appearance)
Holding Redlich (Second and Third Respondents, submitting appearances)
File Number(s): 2024/196931
Publication restriction: Nil
JUDGMENT
The Applicant Seeks to Set Aside a Modifying Development Consent
1. By summons filed on 28 May 2024, the applicant, Ryan Peden, seeks a declaration that consent granted by the first respondent, Lake Macquarie City Council ("the Council") to modification application DA/1682/2020/A on 28 February 2024 for alterations and additions to a dwelling pursuant to s 4.55 of the Environmental Planning & Assessment Act 1979 ("EPAA") ("the modification consent") is invalid and that the owners of the dwelling, the second and third respondents, Ian Paver and Prudence Paver ("the Pavers"), be restrained from acting on the modification consent.
2. An original consent was granted to development application DA/1682/2020 on 27 January 2021 ("2021 consent") by the Council, for alterations and additions to an existing dwelling on Lot 15 Sec 25 DP3109, known as 11 Ebsworth Street, Redhead NSW 2290 ("property").
3. The respondents each filed submitting appearances consenting to the final relief sought in the summons. The submitting appearances stated that each respondent "appears and submits to the making of all orders sought, and the giving or entry of judgment in respect of all claims made, save as to costs".
4. The effect of a submitting appearance is that the submitting parties consent to the orders sought in the originating process (Fitter v Public Trustee [2007] NSWSC 1487), so that a party who is met with submitting appearances from all parties with an interest in the proceedings is generally entitled to judgment without formal proof of their claim (Trust Co of Australia Ltd v Perpetual Trustee WA Ltd (No P2) (1995) 36 NSWLR 654 at 659-661 per Young J and Steinhoff Australia Pacific Ltd v Lifestyle Retailing Pty Ltd [2011] NSWSC 1621). It is nevertheless accepted that the Court retains a discretion to require the applicant to prove the facts grounding their entitlement to relief (Trust Co at 660). This is particularly so when the final relief sought is declaratory.
5. Peden was therefore directed to provide an evidence bundle and written submissions to satisfy the Court that there was a proper basis for accepting his admissions and granting the relief sought.
6. In short, Peden contends that the development permitted by the modification consent is not substantially the same development as that the subject of the 2021 consent as required by s 4.55(1A)(b) and (2)(a) of the EPAA. The summons also alleges, and therefore the submitting appearances also admit, that the modification consent does not demonstrate compliance with provisions of the relevant local planning instruments.
7. The matter was the subject of a brief oral hearing, at the conclusion of which the Court granted the relief sought in prayers for relief 1 and 2 of the summons, with written reasons to be provided subsequently. These are those written reasons.
The Modified Development Was Granted Consent Unlawfully by the Council
Legislative Framework
1. The power to grant consent to a modification application is found in s 4.55 of the EPAA. That provision relevantly provides that:
4.55 Modification of consents—generally
(1) Modifications involving minor error, misdescription or miscalculation A consent authority may, on application being made by the applicant or any other person entitled to act on a consent granted by the consent authority and subject to and in accordance with the regulations, modify a development consent granted by it to correct a minor error, misdescription or miscalculation. Subsections (1A), (2), (3), (5) and (6) and Part 8 do not apply to such a modification.
Note—
Section 380AA of the Mining Act 1992 provides that an application for modification of development consent to mine for coal can only be made by or with the consent of the holder of an authority under that Act in respect of coal and the land concerned.
(1A) Modifications involving minimal environmental impact A consent authority may, on application being made by the applicant or any other person entitled to act on a consent granted by the consent authority and subject to and in accordance with the regulations, modify the consent if—
(a) it is satisfied that the proposed modification is of minimal environmental impact, and
(b) it is satisfied that the development to which the consent as modified relates is substantially the same development as the development for which the consent was originally granted and before that consent as originally granted was modified (if at all), and
(c) it has notified the application in accordance with—
(i) the regulations, if the regulations so require, or
(ii) a development control plan, if the consent authority is a council that has made a development control plan that requires the notification or advertising of applications for modification of a development consent, and
(d) it has considered any submissions made concerning the proposed modification within any period prescribed by the regulations or provided by the development control plan, as the case may be.
Subsections (1), (2) and (5) do not apply to such a modification.
(2) Other modifications A consent authority may, on application being made by the applicant or any other person entitled to act on a consent granted by the consent authority and subject to and in accordance with the regulations, modify the consent if—
(a) it is satisfied that the development to which the consent as modified relates is substantially the same development as the development for which consent was originally granted and before that consent as originally granted was modified (if at all), and
(b) it has consulted with the relevant Minister, public authority or approval body (within the meaning of Division 4.8) in respect of a condition imposed as a requirement of a concurrence to the consent or in accordance with the general terms of an approval proposed to be granted by the approval body and that Minister, authority or body has not, within 21 days after being consulted, objected to the modification of that consent, and
(c) it has notified the application in accordance with—
(i) the regulations, if the regulations so require, or
(ii) a development control plan, if the consent authority is a council that has made a development control plan that requires the notification or advertising of applications for modification of a development consent, and
(d) it has considered any submissions made concerning the proposed modification within the period prescribed by the regulations or provided by the development control plan, as the case may be.
Subsections (1) and (1A) do not apply to such a modification.
(3) In determining an application for modification of a consent under this section, the consent authority must take into consideration such of the matters referred to in section 4.15(1) as are of relevance to the development the subject of the application. The consent authority must also take into consideration the reasons given by the consent authority for the grant of the consent that is sought to be modified.
1. Section 4.15(1) of the EPAA, referred to in s 4.55(3), relevantly states:
4.15 Evaluation
(1) Matters for consideration—general In determining a development application, a consent authority is to take into consideration such of the following matters as are of relevance to the development the subject of the development application—
(a) the provisions of—
(i) any environmental planning instrument, and
(ii) any proposed instrument that is or has been the subject of public consultation under this Act and that has been notified to the consent authority (unless the Planning Secretary has notified the consent authority that the making of the proposed instrument has been deferred indefinitely or has not been approved), and
(iii) any development control plan, and
(iiia) any planning agreement that has been entered into under section 7.4, or any draft planning agreement that a developer has offered to enter into under section 7.4, and
(iv) the regulations (to the extent that they prescribe matters for the purposes of this paragraph),
(v) (Repealed)
that apply to the land to which the development application relates,
(b) the likely impacts of that development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality,
(c) the suitability of the site for the development,
(d) any submissions made in accordance with this Act or the regulations,
(e) the public interest.
1. According to Peden, there are two reasons why the modification consent is invalid. First, the modified development is not substantially the same development as that the subject of the 2021 consent, contrary to s 4.55(1A)(b) and (2)(a) of the EPAA. Second, and related to the first, there has been non‑compliance with the applicable statutory planning instruments.
The Modified Development is not Substantially the Same Development
1. The test for whether a development the subject of a modification application is "substantially the same development" as that for which consent was originally granted was set out in Arrage v Inner West Council [2019] NSWLEC 85 (at [24]-[28]) per Preston J):
24 First, the essential elements to be identified are not of the development consent itself, but of the development that is the subject of that development consent. The comparison required by s 4.55(2) is between two developments: the development as modified and the development as originally approved: see Scrap Realty Pty Ltd v Botany Bay City Council [2008] NSWLEC 333 at [16].
25 Second, the essential elements are not to be identified "from the circumstances of the grant of the development consent"; they are to be derived from the originally approved and the modified developments. It is the features or components of the originally approved and modified developments that are to be compared in order to assess whether the modified development is substantially the same as the originally approved development.
26 The choice of language in the judicial decisions of "material and essential features" or a "material and essential physical element" of the development (see, for example, Moto Projects at [58], [59] and [64]) derives from judicial interpretations of the statutory test that the modified development be "substantially the same" development as the originally approved development. In Vacik Pty Ltd v Penrith City Council [1992] NSWLEC 8 , p 2 Stein J interpreted the word "substantially" in the former s 102(1)(a) of the EPA Act to mean "essentially or materially or having the same essence". That interpretation of the word "substantially" was accepted in North Sydney Council v Michael Standley & Associates Pty Ltd (1998) 43 NSWLR 468 at 475 by Mason P (with whom Sheppard AJA agreed at 403) and at 481–482 by Stein JA and in Moto Projects by Bignold J at [30] and [55].
27 This interpretation of the statutory test that the modified development be substantially the same development as the originally approved development, that the modified development be "essentially or materially" the same or "having the same essence" as the originally approved development could support an inquiry to identify the material and essential features of the originally approved and modified developments in order to undertake the comparative exercise required, but it does not demand such an inquiry.
28 That is one way, probably in most cases the most instructive way, to identify whether the modified development is substantially the same development as the originally approved development, but it is not the only way to ascertain whether the modified development is substantially (in the sense of essentially or materially) the same development as the originally approved development. For example, comparison could be made of the consequences, such as the environmental impacts, of carrying out the modified development compared to the originally approved development: see Moto Projects at [62] and Tipalea Watson Pty Ltd v Ku-ring-gai Council (2003) 129 LGERA 351; [2003] NSWLEC 253 at [17].
1. This analysis was repeated and endorsed in Feldkirchen Pty Ltd v Development Implementation Pty Ltd [2022] NSWCA 227; (2022) 254 LGERA 114 (at [112]). It was reformulated more recently in Canterbury-Bankstown Council v Realize Architecture Pty Ltd [2024] NSWLEC 31 (at [7]):
7 In deciding whether or not the development as modified is substantially the same development as the development for which consent was originally granted, the Commissioner needed to undertake three tasks:
(a) Finding the primary facts: This involves drawing inferences of fact from the evidence of the respects in which the originally approved development would be modified. These respects include the components or features of the development that would be modified, such as height, bulk, scale, floor space, open space and use, and the impacts of the modification of those components or features of the development.
(b) Interpreting the law: This involves interpreting the words and phrases of the precondition in s 4.55(2) as to their meaning.
(c) Categorising the facts found: This involves determining whether the facts found regarding the respects in which the development would be modified fall within or without the words and phrases of the precondition in s 4.55(2). American jurist, Karl Llewellyn termed such descriptions of words and phrases as "abstract fact-categories": Karl Llewellyn, The Bramble Bush: On Our Law and Its Study (Oceana Publication 1960) 80. In the Australian authorities, they are commonly referred to as "statutory descriptions" or "statutory criteria": see, for example, The Australian Gas Light Company v The Valuer-General (1940) 40 SR (NSW) 126 at 137-138; Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139 at 156; Randwick Municipal Council v Manousaki (1988) 66 LGRA 330 at 333. The decision-maker's task is to determine whether the facts found fall within or without the statutory description, "according to the relative significance attached to them" by the decision-maker: The Australian Gas Light Company v The Valuer-General at 138.
1. An inquiry into the material and essential features or elements involves an appreciation, both quantitative and qualitative, of both the originally approved and modified development (Moto Projects (No 2) Pty Ltd v North Sydney Council [1999] NSWLEC 280; (1999) 106 LGERA 298 at [56]).
2. As the evidence reveals, the following list of material and essential features of the modified development were not part of the development the subject of the 2021 consent:
1. the overall floorplan was increased from 221 m2 to 309 m2, including a further 62 m2 in alfresco area and upper deck. This is either a 40% or a 68% increase to the gross floor area, depending on whether the outdoor and deck area is included;
2. the existing trees preserved by the development the subject of the 2021 consent are to be removed to accommodate new structures;
3. there is a new studio at the rear of the property with a separate entrance and carpark, thereby rendering the studio a dual occupancy;
4. there is a new alfresco area to the rear of the property;
5. there is an enlarged garage requiring excavation;
6. there are changes to the front steps;
7. there are new and enlarged decks at the front of the property affecting the amenity of the streetscape and impeding the neighbours' ocean views;
8. there are roof form changes;
9. the number of doors and windows have been altered throughout the dwelling;
10. there are changes to the internal layout of the dwelling, including the addition of an elevator; and
11. the height of the development has increased by at least 1.2 m to be greater than 8.5 m (up from 7.3 m).
1. Comparing the material elements of the development the subject of the 2021 consent to the development the subject of the modification consent, it therefore cannot be said that the two developments are essentially or materially the same. That is, the modified development is not substantially the same as the development approved by the 2021 consent.
2. In Arrage, Preston J identified some discretion given to the consent authority arising from the language "matters…as are of relevance" (at [43] and [44]):
43 This is not to say that it would not be permissible for a consent authority to consider the provisions of applicable environmental planning instruments in determining whether the precondition in s 4.55(2)(a) is met, only that the consent authority is not bound in law to do so. There is a difference between a relevant matter that a repository of power is bound to consider and a permissible matter that the repository of power is entitled to consider.
44 In these circumstances, the Commissioner would not err on a question of law by not expressly considering the provisions of MLEP in determining whether he was satisfied of the precondition in s 4.55(2)(a) of the EPA Act.
1. In relation to s 4.55(2)(a) of the EPAA, his Honour said that it would not be an error of law to expressly consider, or to ignore, relevant s 4.15(1) matters or the reasons for the grant of consent, in determining whether the precondition in s 4.55(2)(a) of that Act was met.
2. Section 4.15(1) of the EPAA requires the consent authority to take into consideration "such of the following matters as are of relevance to the development the subject of the development application". The matters referred to in s 4.15(1) include any environmental planning instrument, such as the Lake Macquarie Local Environmental Plan 2014 ("LMLEP") and any development control plan, such as the Lake Macquarie Development Control Plan 2014 ("LMDCP").
3. It may be inferred that by filing submitting appearances each of the respondents admits the allegation contained in the summons that the modification does not comply with the relevant provisions of the LMLEP and LMDCP. This is demonstrated by the evidence.
4. It is tolerably clear from the plans the subject of the modification application that were before the Council that:
1. the modification did not comply with cl 2.3 (zone objectives and land use table) or cl 4.3 (height of the buildings – the development as modified exceeds 8.5 m) of the LMLEP; and
2. the modification did not comply with cl 3.2 (street setback), cl 3.6 (building bulk), or cl 3.9 (views) of the LMDCP.
1. For example:
1. in relation to land use, the Amended Statement of Environmental Effects dated September 2023 ("the SEE") submitted with the modification application states that it includes a "STUDIO OVER NEW ALFRESCO TO REAR" (p 2). A "studio" is not a defined term under the LMLEP or LMDCP, but an examination of Approved Plan Sn4.55-18 clearly shows a separate entry to the studio from the dwelling and direct access to the street along the southern boundary. The studio has a separate bathroom and kitchenette. With an area of approximately 42.42 m2, it appears to be a secondary dwelling. Nothing in the SEE addressed the use of the secondary dwelling. Nor was there any relevant comment made by the Council in the materials assessing this aspect of the proposed modification; and
2. in relation to the setback, the LMDCP (pp 28 and 29) provides that the front setback must be consistent with the established setbacks. The 2021 consent allowed an extension to the single floor above the garage of 3.13 m into the existing front setback. The modified development adds a second storey with no upper‑level step in. Accordingly, it is not aligned with the streetscape. This feature significantly impacts Peden's view lines to the ocean.
1. Accordingly, the development as modified does not meet the requirements of the relevant parts of the LMLEP and LMDCP.
2. It follows that the Council could not be satisfied of the matters necessary to enliven the lawful exercise of its power to approve the modification application pursuant to s 4.55 of the EPAA. In these circumstances, there can be no question as to the materiality of the error committed by the Council (LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12; (2024) 98 ALJR 610 at [32]-[36]). For these reasons, the modification consent is invalid and the Pavers should be permanently restrained from relying upon it.
Costs and Submitting Appearances
1. In Class 4 matters, costs usually follow the event. However, that position is modified by the respondents' submitting appearances, each of which were filed before the first return date. While the costs incurred before the filing of the submitting appearances are likely to be minimal, there was, according to Peden, no reason in principle why the burden of these costs should fall wholly upon him when he has been vindicated in challenging the validity of the modification consent. Peden submitted that it was appropriate that he recover his costs on an ordinary basis, at least up to the date of the filing of the submitting appearances.
2. Initially Peden sought costs against all respondents up to the date of the filing of their respective submitting appearances. But, after some discussion, the claim was abandoned against the Pavers and pursued exclusively against the Council. Given the alacrity with which the Pavers filed their submitting appearance (on 18 June 2024, that is, only two weeks after the summons was filed) and their lack of blameworthiness, it would be an unreasonable exercise of the Court's discretion to award costs against them, however nominal. It is not known, for example, whether any entreaties were made to the Pavers by Peden to resolve the matter absent litigation (such as by the surrender of the modification consent). In these circumstances, the only appropriate order as between Peden and the Pavers, is that there be no order as to costs. This conclusion is consistent with the principles set out in ss 56 to 60 of the Civil Procedure Act 2005 ("CPA").
3. Different considerations apply, in my view, in respect of the Council, which exercised its power improperly to grant consent to the modification application. It did not file a submitting appearance until 17 July 2024, that is, almost two months after the summons was filed.
4. Peden further complained that the Council was not forthcoming with important information in its possession, namely, the modified plans in an unredacted form, until Peden took formal steps to compel the compliance of these documents by a notice to produce. Peden submitted that as a consequence he should be awarded his costs of the document production process. The suggested costs order was therefore that the Council pay Peden's costs from 28 May to 17 July 2024, and the costs of and incidental to the notice to produce returned on 26 July 2024, as assessed or agreed.
5. In Inglis v Buckley (No 2) [2023] NSWLEC 113 Pain J helpfully set out the following principles with respect to awards of costs against parties who have filed submitting appearances (at [47]):
47 I gratefully adopt, and set out below, the summary of principles to apply in costs determinations provided by the First Respondent, also accepted by the Applicant, as these are accurate and relevant to this matter. Established principles that would assist the Court in the exercise of the costs discretion in the circumstances of this proceeding are:
(1) the rationale for the usual rule that costs follow the event is that the successful party to proceedings should be compensated and that an award of costs is not to be punitive: Latoudis;
(2) ordinarily, an order for costs will not be made against a submitting party: Develtor Property Group Pty Ltd v Newcastle City Council [2001] NSWLEC 47 at [42]; Highland v Labraga (No 3) [2006] NSWSC 871 at [20]-[23]; Midson v Workers Compensation Commission (No 2) [2017] NSWSC 147 at [28]-[31];
(3) there is no prima facie rule that a submitting party will never be ordered to pay costs, contextual circumstances will be taken into consideration: Seller v Jones [2014] NSWCA 19 at [55], [59] cited with approval in Lou v IAG Ltd t/as NRMA Insurance (2019) 101 NSWLR 606; [2019] NSWCA 319 (Lou) at 614;
(4) abiding by the limits of the Hardiman principle does not immunise a government authority from an adverse costs order: Our Town FM Pty Ltd v Australian Broadcasting Tribunal (No 3) (1987) 77 ALR 609 at 612;
(5) Material considerations (House v King (1936) 55 CLR 499; [1936] HCA 40) to the exercise of discretion relevantly include:
(a) whether the filing of a submitting appearance by the First Respondent and the 'role' taken by the Council were consistent with the overriding purpose of facilitating the just, quick and cheap resolution of the real issues in dispute contained in s 56(3) of the Civil Procedure Act: Lou at [47];
(b) whether the error the subject of the proceeding was caused by a party: Lou at [44], Cutcliffe at [50], noting that it is a material consideration rather than a rule per Basten JA in Rossi v Living Choice Australia Ltd [2015] NSWCA 244 at [73]; and
(c) whether the proceeding could have been resolved by consent: Lou at [44] (i.e. the conduct of the parties in the litigation).
1. These principles have been adopted and applied by recent decisions of this Court in Sader v Elgammal (No 3) [2024] NSWLEC 35 (at [165]) and Woollahra Municipal Council v Cameron (No 2) [2024] NSWLEC 66 (at [41]).
2. There is no impediment to awarding costs against a consent authority that has filed a submitting appearance, notwithstanding the caution against doing so urged by Basten JA in Rossi v Living Choice Australia Ltd [2015] NSWCA 244 (at [73]). The caselaw is replete with instances of costs orders made against such entities (see the authorities usefully collected by Pritchard J in Cameron (No 2) at [35]-[40]).
3. In the absence of evidence concerning the circumstances giving rise to the need to issue the notice to produce to the Council, and to avoid the risk of denying the Council procedural fairness in this regard (which would halt the finalisation of the proceedings and cause attendant delay and costs contrary to the overriding purpose set out in ss 56 to 60 of the CPA), I decline to order that the Council pay Peden's costs associated with the notice to produce.
4. Having said this, I consider it an entirely appropriate exercise of my discretion to order that the Council, as the consent authority who approved the impugned modification application, pay Peden's costs up to the date that the submitting appearance was filed on 17 July 2024, however limited these may be.
Orders
1. For the reasons given above, the Court declares that the s 4.55 modification application DA/1682/2020/A approved by the first respondent on 28 February 2024 (the modification consent), modifying development consent DA/1682/2020 (the 2021 consent) for alterations and additions to the existing dwelling on Lot 15 Sec 25 DP3109, known as 11 Ebsworth Street, Redhead, NSW 2290, is invalid.
2. Further, the Court orders that:
1. the second and third respondents, their servants and agents are restrained from acting on the modification consent;
2. the first respondent is to pay the applicant's costs on an ordinary basis up to the date of the filing of the first respondent's submitting appearance on 17 July 2024;
3. as between the applicant and the second and third respondents, there is no order as to costs; and
4. the exhibits are to be returned.
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Decision last updated: 20 August 2024