Reported Decision : (2000) 107 LGERA 363 Land and Environment Court of New South Wales CITATION : Meriton Apartments Pty Ltd v Minister for Urban Affairs and Planning & Or [2000] NSWLEC 20 APPLICANT Meriton Apartments Pty Ltd PARTIES : RESPONDENT Minister for Urban Affairs and Planning & Or FILE NUMBER(S) : 40149 of 1999 CORAM: Cowdroy J KEY ISSUES: Environmental Planning Instruments :- local environmental plan - development control plan - affordable housing scheme - contribution required by local environmental plan for affordable housing as a condition to development consent in designated locality known as Green Square either by allocation of floor space or cash contribution - no compensation - purpose of affordable housing inconsistent with objectives of EP&A Act and of Pt 4 Div 6 - contribution not constituting a tax but invalid as fundamental interference proprietary rights and unreasonable in Wednesbury sense - invalid provisions not severable rendering the whole of the LEP and DCP invalid LEGISLATION CITED: Environmental Planning and Assessment Act 1979 s 5, s 24, s 26, s 69, s 70, s 80, s 80A, s 94 Interpretation Act 1987 1987 s 3, s 33 Rockdale v Tandel Corporation Pty Limited (1975) 34 LGRA 196; The State of South Australia v Tanner & Others (1989) 166 CLR 161; Westminster City Council v Great Portland Estates Plc [1985] AC 661; Building Owners and Managers Association of Australia Ltd v Sydney City Council (1984) 53 LGRA 54; Regina v Westminister City Council Ex parte Monahan & Anor [1990] 1 QB 87 (CA); Woollahra Municipal Council v Minister for the Environment (1991) 23 NSWLR 710; Fitch v Shoalhaven City Council; Morton v The Union Steamship Company of New Zealand (1951) 83 CLR 402; Greek Australian Finance Corporation Pty Ltd v Sydney City Council (1972-74) 29 LGRA 130; Allen Commercial Constructions Pty Limited v The Council of the Municipality of North Sydney (1970) 123 CLR 490; Mixnan's Properties Ltd v Chertsey Urban District Council [1964] 1 QB 214; CASES CITED: Pyx Granite Co. Ltd. V. Ministry of Housing and Local Government [ 1958] 1 Q.B. 554; Big Country Developments v Penrith City Council (Pearlman J, NSWLEC, 8 December 1997); Darling Casino Ltd v Minister for Planning and Sydney Harbour Casino Pty Ltd (1995) 86 LGERA 186; Franklins Limited v Penrith City Council and Campbells Cash & Carry Pty. Limited ([1999] NSWCA 134, NSW Court of Appeal, unreported 13 May 1999, ; Currey v Sutherland Shire Council (1998) 100 LGERA 365; Hall & Co Ltd v Shoreham-by-Sea Urban District Council & Anor [1964] 1 WLR 240; Regina v Hillingdon London Borough Council Ex parte Royco Homes Ltd [1974] 1 QB 721; Belfast Corporation v O.D. Cars Ltd. [1960] AC 490; Airservices Australia v Polaris Holding Company [1999] HCA 62; MacCormick v Federal Commissioner of Taxation (1983-1984) 158 CLR 622; Northern Suburbs General Cemetery Reserve Trust v The Commonwealth of Australia (1992-1993) 176 CLR 555; Harper v Minister for Sea Fisheries & Ors (1989-90) 168 CLR 314; Air Caledonie International v Commonwealth (1988) 165 CLR 462 DATES OF HEARING: 20/12/99, 21/12/99, 22/12/99 DATE OF JUDGMENT: 02/18/2000 APPLICANT Mr M Tobias QC with Mr B Preston SC SOLICITORS Phillips Fox FIRST RESPONDENT Mr P McClellan QC with Mr A Galasso LEGAL REPRESENTATIVES: SOLICITORS Department of Urban Affairs and Planning Legal Branch SECOND RESPONDENT Mr P Schofield (Solicitor) SOLICITORS Pike Pike & Fenwick JUDGMENT: IN THE LAND AND MATTER No. 40149 of 1999 ENVIRONMENT COURT CORAM: Cowdroy J OF NEW SOUTH WALES DECISION DATE: 18/2/00 Meriton Apartments Pty Limited Applicant v Minister for Urban Affairs and Planning First Respondent South Sydney City Council Second Respondent JUDGMENT Introduction 1. Green Square is a former industrial site which is undergoing re-development for residential purposes. Green Square lies within the boundaries of the South Sydney City Council ("the council"). The site is affected by the South Sydney Local Environmental Plan 1998 (Amendment No 2) - Green Square, hereafter referred to as "the LEP". The LEP was published in the New South Wales Government Gazette on 28 May 1999. 2. The subject site is also affected by the Green Square Affordable Housing Development Control Plan ("the DCP") which came into operation on 15 March 1999. 3. Meriton Apartments Pty Ltd ("the applicant") makes numerous challenges to the validity of Division 3 of the LEP and the entire DCP. The LEP creates the concept of 'affordable housing' and the DCP provides the detailed provisions for the implementation of that concept. 4. The LEP requires an applicant seeking development consent ("an applicant") pursuant to the provisions of Pt 4 of the Environmental and Assessment Act 1979 ("the Act") within Green Square to satisfy the council that as a condition of such consent, a contribution will be made for 'affordable housing', as defined hereunder. In summary affordable housing consists of residential accommodation (referred to as "land") which must be assigned to a nominated housing authority by the applicant either by permanent reservation for such purpose or by transfer of title. In lieu, a cash contribution may be made. The required contribution (whether by land or cash), is hereafter referred to as the "contribution". The accommodation is to be solely used by households of low to moderate income as described in the DCP. The affordable housing provisions 5. Clause 27A of the LEP entitled ' Vision for Green Square ' refers to the desire to transform Green Square into ' an attractive, vibrant urban place by capitalising on the opportunities' created by its geographic location close to Sydney's ' economic gateways' namely Sydney Airport, Port Botany, the Central Business District and the new Southern Railway and Green Square Station. It states that such 'vision' is sustained by four factors. One factor, identified as 'diversity' provides (cl 27A(2)(a)):- (a) Diversity This applies to the development of a mix of land uses, a range of building types, diverse public spaces, and employment and housing choices, which will support a socially diverse community, underpinning a vibrant city that offers complex experiences and social contact. 6. Clause 27M of the LEP defines 'affordable housing' as follows:- affordable housing means rented housing occupied by very low, low and moderate income households provided and managed under the scheme provided by the Green Square Affordable Housing Development Control Plan adopted by the Council on 10 February 1999, and in accordance with the affordable housing principles. The gross incomes of such households fall within the following ranges of percentages of the median household income for the time being for the Sydney Statistical Division according to the Australian Bureau of Statistics: Very Low income household …………………………………….Less than 50% Low income household ……………………… 50 or more but less than 80% Moderate income household ………………………………………. 80 - 120% 7. Clause 27N of the LEP states the principles of affordable housing as follows:- The affordable housing principles are as follows:- (a) affordable housing is to be provided and managed in the Green Square area so that a socially diverse residential population representative of all income groups is created and maintained, (b) affordable housing is to be made available to a mix of households on very low, low and moderate incomes, (c) affordable housing is to be rented to eligible households at an appropriate rate of gross household income, (d) dwellings provided for affordable housing are to be managed so as to maintain their continued use for affordable housing, (e) affordable housing is to consist of dwellings constructed to a standard which in the opinion of the Council is consistent with other dwellings in the Green Square area and with an average total floor area of not less than 100 square metres. The DCP 8. The DCP provides the detailed machinery for the implementation of the affordable housing provisions of the LEP and cl 2.1 of the DCP refers to the LEP as encouraging and promoting ' a wide range of housing in terms of form, tenure and social mix' . It also refers to the need for affordable housing stating that without such provision existing ' lower income groups would need to move out of the area, and new lower income households may be prevented from finding housing in Green Square close to new employment opportunities '(cl 2.3). 9. Clause 2.4 of the DCP refers to financial data and identifies household groups by reference to gross income. A very low income is stated to be $19,968 (presumably per annum); low to moderate between $19,968 and $31,949; and moderate between $31,949 and $47,923, of the DCP. Clause 2.4 states:- Within the context of the Green Square housing program, the aim is to provide dwellings which are affordable to low, very low, low to moderate, and moderate income households at a reasonable rental cost. 10. Clause 2.5 of the DCP quantifies the contribution. Clause 3.1 thereof confirms that such contribution may be a condition of development approval. An applicant may retain ownership of the designated land required for affordable housing, provided an agreement is entered into with a community housing provider. Alternatively, title to the land must (by virtue of cl 3.2 of the DCP) be transferred to a recommended non-profit community housing organisation unless a cash contribution is made, the provisions for which are set out hereunder in cl 27Q of the LEP and cl 3.4 of the DCP. 11. Clause 4.1 of the DCP relates to the administration and management of affordable housing contributions and nominates The Office of Community Housing, a division of the Department of Urban Affairs and Planning as being responsible ' for negotiating resources for the community housing sector '. The clause provides inter alia:- Non-profit community housing organisations will manage and deliver affordable housing obtained through contributions. Schedule 1 Pt 4 of the DCP nominates City West Housing Company Pty Ltd as the only ' recommended community housing provider' , to ' manage and deliver affordable housing obtained through contributions' . The shareholders of this corporation are the Minister for Housing and the Treasurer of New South Wales. Provisions in issue 12. The applicant challenges provisions contained in Div 3 of the LEP which implement the affordable housing scheme namely clauses 27P, 27Q and 27R (hereafter referred to as "the challenged provisions"). Clause 27P of the LEP states the formula for the assessment of the contribution and provides:- 27P Inclusion of affordable housing in a building (1) Before granting consent to the carrying out of development (other than subdivision) on land in Green Square within Zone No 10(a), 10(b), 10(c) or 10(d), the Council must be satisfied that not less than the following amount of total floor area to which the development application relates will be used for the purpose of affordable housing, in accordance with the affordable housing principles in this Division and the affordable housing provisions for Green Square: (a) 3% of so much of that total floor area as is intended to be used exclusively for residential purposes, and (b) 1% of so much of that total floor area as is not intended to be used exclusively for residential purposes, and (c) if the percentage required to be provided would be insufficient to provide complete dwellings, such extra amount of that total floor area as may be necessary to provide complete dwellings having an average total floor area of at least 100 square metres. (2) It does not matter whether the total floor area concerned was in existence before, or is created after, the commencement of this Division, or whether the area concerned replaces a previously existing area. (3) Nothing prevents in a particular case the provision of some of the complete dwellings required by this Division to be provided for affordable housing and the provision of a proportion of the monetary contribution equivalent to make up for the rest of the complete dwellings. 13. Clause 27Q of the LEP allows council to dispense with the provision for affordable housing where the applicant pays a cash contribution in lieu of floor space as follows:- 27Q Contribution of money as an alternative to including affordable housing in a building (1) Clause 27P does not require the provision of affordable housing if the Council is satisfied that: (a) a monetary contribution has been or will be provided, by or on behalf of the applicant for development consent, for use for the purpose of providing affordable housing within Green Square in accordance with the affordable housing principles and the affordable housing provisions, and (b) the amount of the contribution has been calculated, in accordance with this clause and the affordable housing provisions, as equivalent to the value of the total floor area that would otherwise be required by this Division to be provided for use for affordable housing, except any extra amount of area included to provide complete dwellings in accordance with that clause. (2) Demolition of a building or a change in the use of land does not give rise to a claim for a refund of any amount that has been contributed under this clause for use for affordable housing. 14. Clause 3.4 of the DCP provides the detail for cl 27Q of the LEP as follows:- Where an applicant chooses to pay a monetary contribution towards affordable housing, the amount of the contribution will be nominated in the condition of development consent. Before the granting of any construction certificate, the applicant must provide evidence to Council of payment of the contribution. Payment will be by unendorsed bank cheque to the Department of Urban Affairs and Planning. As an alternative, the applicant may provide evidence that a satisfactory bank guarantee, to the value of the required contribution has been lodged with the Department of Urban Affairs and Planning. In lieu contributions will be indexed annually in accordance with the Established House Prices Index. See Section 2.7 Indexation of Contributions. The affordable housing condition of consent will be satisfied when payment of the required monetary contribution has been made. Evidence that this has occurred will be required by Council before the granting of any occupation certificate. The contribution will be transferred to the community housing organisation for management and construction of affordable dwellings in accordance with the principles of Schedule 4 of South Sydney LEP 1998 (Amendment No. 2) - Green Square, and this DCP. 15. Clause 27R gives the council power to require the contribution as a condition of development consent. In its terms, 'development' is not confined to residential development but extends to any kind of development as stated in sub-clauses 21A(3); 21B(3); 21C(3) and 21D(3) of the LEP. Such development may include renovations, extensions or refurbishment of existing buildings. Clause 27R provides:- 27R Conditions on development consent to give effect to this Division (1) The Council may impose conditions on any consent for development for the purpose of achieving the affordable housing aims and objectives of this Division. (2) In particular, any such condition may be imposed to ensure that any affordable housing that is to be provided under this Division is provided in accordance with the affordable housing principles or that any monetary contribution that is elected or required to be provided for the purpose of any such affordable housing is provided in accordance with those principles. 16. Exemptions to the affordable housing scheme are those itemised by cl 27S which provides:- This Division does not require the Council to ensure that affordable housing will be provided in the case of a development: (a) for residential purposes, if the proposed development will result in the creation of less than 200 square metres of total floor area, or (b) for non-residential purposes, if the proposed development will result in the creation of less than 60 square metres of total floor area, or (c) for the purpose of public housing, or (d) for the purpose of affordable housing, if the applicant for consent is a community housing or non-profit organisation, or (e) for the purpose of community facilities, or (f) for the purpose of a public road, or a public utility undertaking or facility, and for no other purpose. Challenges under the EP&A Act 17. The applicant submits that the challenged provisions are invalid for several reasons. The applicant firstly submits that the LEP does not conform to the objectives of the Act (s 5) and by reason of such non-conformity the affordable housing provisions are invalid. 18. Secondly, the applicant submits that the power to impose conditions on any consent for development is found exclusively in s 80, s 80A and s 94 of the Act. It says that the challenged provisions are inconsistent or repugnant with such provisions because they seek to provide a source of power which circumvents s 80, s 80A and s 94 of the Act. 19. As an additional basis for invalidity the applicant submits that the required contribution imposes a tax inconsistent with the purposes of the Act. 20. The applicant submits that the challenged provisions are discriminatory because only applicants seeking development consent within Green Square are subject to the provisions of Div 3 of the LEP. Additionally, the applicant submits that discrimination exists since certain types of development are exempted from the requirements of affordable housing (s 27S). 21. The applicant submits that the challenged provisions are designed to satisfy the pre-existing demand for affordable housing a demand created otherwise than by the proposed development. The challenged provisions apply irrespective of whether the particular development creates demand for the provision of affordable housing. It is claimed that the contributions required by s 27P and s 27Q do not reasonably relate to any development in Green Square. 22. In the absence of compensation payable in return for the contribution the applicant submits that the challenged provisions operate oppressively or otherwise constitute an unlawful interference with the private and proprietary rights of owners of land in Green Square. 23. Additionally the applicant submits that the provisions of Div 3 of the LEP prevent the council as a consent authority from exercising its discretionary power to grant consent to a development application in Green Square. It says the challenged provisions require the contribution irrespective of the individual circumstances of the application, and thereby impose an unlawful fetter on the exercise by the council of its discretionary power to consider an application for development pursuant to s 79C of the Act. The DCP 24. The applicant submits that the DCP is invalid upon the ground that it purports to conform to the challenged provisions of the LEP. By virtue of the integral relationship between the LEP and the DCP the applicant says that if the challenged provisions of the LEP are found to be invalid, the DCP will also be invalid. Submissions of the Minister 25. The Minister submits inter alia, that provided the LEP was made for the purpose of achieving any of the objects of the Act the attempt to construe such plan as being beyond the power provided by the Act must fail. The Minister relies upon the principle expounded in Packham v The Minister (1993) 31 NSWLR 65 (per Kirby at 69 and per Sheller JA at 89) that it is the essential character and not the incidental consequences of a provision which determine if such provision is within power. 26. In answer to the submission that the challenged provisions constitute a tax the Minister submits that the provisions of cl 27Q which provides for the payment of money in lieu of a material benefit demonstrate that the contribution is not per se indicative of a tax. The Minister relies upon Rockdale v Tandel Corporation Pty Limited (1975) 34 LGRA 196 wherein Glass JA at 206 observed that conditions of development consent requiring contributions were not necessarily taxes. As an alternative, the Minister says that if cl 27Q is found to be invalid, such provision is severable so that any applicant for development must satisfy the provision of actual housing. Submissions of the council 27. The council, whilst generally supporting the submissions of the Minister, relies upon s 121(g) of the Act as a basis to support its submission that the Act can be characterised as a statute which encompasses social welfare. Section 121(g) provides:- 121G (1) If an order will or is likely to have the effect of making a resident homeless, the person who gives the order must consider whether the resident is able to arrange satisfactory alternative accommodation in the locality. (2) If the resident is not able to arrange satisfactory alternative accommodation in the locality, the person who gives the order must provide the resident with: (a) information as to the availability of satisfactory alternative accommodation in the locality, and (b) any other assistance that the person considers appropriate. Power of the council to make an LEP 28. Section 24 of the Act is the source of power for the making of an LEP. It relevantly states:- ... an environmental planning instrument may be made in accordance with this Part for achieving any of the objects of this Act. The relevant objects of the Act are stated in s 5(a) of the Act as follows:- (a) to encourage- (i) The proper management, development and conservation of natural and artificial resources, including agricultural land, natural areas, forests, minerals, water, cities, towns and villages for the purpose of promoting the social and economic welfare of the community and a better environment; (ii) the promotion and co-ordination of the orderly and economic use and development of land; (iii) the protection, provision and co-ordination of communication and utility services, (iv) the provision and co-ordination of community services and facilities; and (v) the protection of the environment, including the protection and conservation of native animals and plants, including threatened species, populations and ecological communities and their habitats; and (vi) ecologically sustainable development, and (b)-(c) not relevant Section 26 of the Act enhances the operation of s 24 by providing specific details of the matters which may be addressed in a planning instrument. The objects of the EP&A Act compared with the affordable housing provisions 29. To determine if delegated legislation is within the power of an enabling statute the general propositions stated by Brennan J in The State of South Australia v Tanner & Others (1989) 166 CLR 161 at 178 - 179 are applicable. His Honour stated:- First, as the validity of the regulation depends on whether it answers the statutory description, the problem is one of characterisation. Next, the character of a regulation is asertained by reference to its operation and legal effect in the circumstances to which it applies. The character of the regulation is asertained by the court's own assessment of the directness and substantiality of the connexion between the likely operation of the regulation and the statutory object to be served. If directness and substantiality of the connexion between the likely operation of the regulation and the statutory object is exiguous that the regulation could not reasonably have been adopted as a means of fulfilling the statutory object, the regulation is invalid. Moreover, it must be steadily borne in mind that the fulfilling of the statutory object is a limitation on the power to make the regulation. A regulation which is so widely drawn as needlessly to embrace a field of operation which is quite unconnected with the statutory object cannot reasonably be adopted in exercise of a power so limited. A local environmental plan made subject to the constraints of s 24 of the Act must conform to the objects of such Act. It is an instrument as defined in s 3 of the Interpretation Act 1987 and is analogous to the legal status of a regulation as considered by Brennan J in The State of South Australia v Tanner & Others at 178 - 179. 30. Decisions relating to the interpretation of planning laws in the United Kingdom provide a useful guide to the applicant's first challenge. In East Barnet Urban District Council v British Transport Commission [1962] 2 QB 484, a case concerning alteration of use, Lord Parker CJ said at 491:- …what is really to be considered is the character of the use of the land, not the purpose of a particular occupier. This passage was extended by Lord Scarman in Westminster City Council v Great Portland Estates Plc [1985] AC 661 where His Lordship said at 670:- It is a logical process to extend the ambit of Lord Parker CJ's statement so that it applies not only to the grant or refusal of planning permission and to the imposition of conditions but also to the formulation of planning policies and proposals. 31. From these observations, a clear principle emerges which is pivotal to the present issue namely, whether the challenged provisions can truly be categorised as those which relate to a planning purpose. 32. An objective of the Act is to encourage management, development and conservation of natural and artificial resources including cities, towns and villages for ' the purpose of promoting the social and economic welfare of the community and a better environment' (s 5(a)(i)). The remaining objectives such as economic use and development of the land, provision of community services (s 5(a)(ii)) and provision of land for public purposes (s 5(a)(iv)) are obviously directed to environmental and town planning. 33. The reference in s 5(a)(i) of the Act to the promotion of ' the social and economic welfare of the community' is not in itself an object of the Act. Rather it is the desired consequence intended to result from the development with which the objects of such Act are concerned. Such words relate to the betterment of the community as a whole which is to flow from the sound development and planning required by the Act. No particular class of the community is identified for special benefit, nor is it an object of the Act to create a ' social mix ' (cl 2.1 of the DCP) within any sections of the community. 34. Authorities such as Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 (CA) at 408, 417, 423 and Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 390 endorse the purposive approach to statutory interpretation as does s 33 of the Interpretation Act 1987. Section 34(f) thereof allows the Court to take judicial notice of a speech made to the House of Parliament by a Minister as an aid to statutory interpretation. 35. The Minister's second reading speech relating to the Cognate Environmental Planning Bills (Hansard, 14 November 1979, Legislative Assembly, at 3045, 3048) leaves no doubt as to the objects of the Environmental Assessment Bill wherein the following is recorded:- The fundamental purpose of these bills before the House is the creation of a legislative framework for environmental planning decision-making. Their objective is to satisfy best the current and future needs of this State in respect of planned development, economic growth and social environmental enhancement. … In essence, it involves decision-making for planned development and conservation to achieve economic and social growth within the tolerable limits and capacities of the physical [emphasis added] environment. The council has referred to the second reading speech of the Minister, the Hon D P Landa delivered in the Upper House in relation to the Bills (Hansard 21 November 1979 Legislative Council 3345) wherein the Minister said at 3346:- The essential aim of the bills is to create a system of environmental planning under which decisions on land use and resource management are made within the physical [emphasis added] capacity of the environment in order to promote the economic and social welfare of the people of New South Wales. 36. Whilst the council argues that the latter speech refers to the broadening of ' the scope of planning effectively to embrace economic, social and ecological considerations in the preparation of environmental plans and in development control' , (Hansard 21 November 1979 Legislative Council 3345 at 3346) such words must be considered in context. The proposed Bill was directed to the reform of town planning and development and not to the provision of welfare for the community. Lord Justice Kerr in Regina v Westminister City Council Ex parte Monahan & Anor [1990] 1 QB 87 (CA) at 112 and Lord Scarman in Westminster City Council v Great Portland Estates Plc at 670, affirmed the concept that whilst planning law may have an indirect beneficial social outcome such outcome cannot be utilised to expand the purpose of a planning statute. 37. The affordable housing provisions can be characterised as relating essentially to a social purpose, namely the provision of housing for a particular group within the community. The opportunity to provide such benefit is predicated upon development in Green Square. Such purpose is not related to the physical development of town planning or of the environment, but is directed to benefit those persons who would be eligible for affordable housing. 38. Section 121(g) of the Act is not relevant to the issues since it only has application in limited circumstances and does not expand the objects of the Act. Where the enabling statue unambiguously provides the objects to which delegated legislation may be addressed, it is erroneous to utilise the body of the enabling statute as an aid in interpretation; see Springvale Washed Sand Pty Ltd v City of Springvale [1969] VR 784 at 794; Masterwood Pty Ltd v Far North Queensland Electricity Board [1999] 1 QdR (CA) 345 at 357; Paull v Munday (1976) 50 ALJR 551 at 554. Even if it was necessary to utilise s 121(g) to expand s 5, it would merely confirm the conclusion already reached since the operation of s 121(g) is predicated upon the occurrence of a physical development. 39. The fact that the challenged provisions may be for a laudable purpose is not germane to the issues raised in these proceedings. Such purpose cannot validate an excessive use of power; see Woollahra Municipal Council v Minister for the Environment (1991) 23 NSWLR 710 at 716 per Gleeson CJ, at 726 per Kirby P, at 733 per Samuels JA. Conflict with section 94 40. Part 4, Div 6 of the Act is titled 'Conditions requiring contributions towards public amenities and services' , and contains sections 94, s 94A, s 94B, s 94C, s 94D which make provision for the requirement of contributions by councils in respect of development. Such contributions may be dedication of land free from cost (s 94(1)(a)) or the payment of monetary contribution (s 94(1)(b)). Section 94 contributions can only be required where a consent authority is satisfied that the proposed development ' will or is likely to require the provision of or increase the demand for public amenities and public services within the area ' (s 94(1)); Pioneer Homes Pty Ltd v Liverpool City Council (1992) 77 LGRA 237 at 241. A council must apply contributions in conformity with its obligations under Part 4 Div 6: Toadolla Co Pty Ltd v Dumaresq Shire Council (1992) 78 LGERA 261 at 267, 268; Levadetes v Hawkesbury Shire Council (1988) 67 LGRA 190 at 195; Rodmac Investments Pty Ltd v Great Lakes Shire Council (Bignold J, NSWLEC, 2 August 1991, unreported at 8). Any monetary contribution is to be held and applied towards the public amenities or public services or both 'within a reasonable time and in such manner as will meet the increased demand' for such amenities or services (s 94(6); Levadetes v Hawkesbury Shire Council at 195). 41. The effect of s 94 has been the subject of interpretation by this Court. In Fitch v Shoalhaven City Council (1989) 67 LGRA 165 at 170, Stein J held that such section provided the exclusive power for a council to impose a contribution as a condition of development consent. His Honour's decision endorsed two earlier decisions by Senior Assessor Bignold (as he was then titled) in Henbury Pty Ltd v Parramatta City Council (NSWLEC, 22 March 1982, unreported) and St George Building Society v Manly Municipal Council (1982) 3 APA 370 at 387 - 388 and finally settled the status of such provisions after the issue was raised but not resolved by Cripps J in Building Owners and Managers Association of Australia Ltd v Sydney City Council (1984) 53 LGRA at 70. 42. These decisions recognised that if s 94 was not the sole source of power for requiring contributions s 80 could be utilised to circumvent the requirements of s 94 thus rendering such section a nullity. The decision in Fitch v Shoalhaven City Council is further supported by the comprehensive nature of the provisions of Pt 4 Div 6. In Wallace-Johnson v R [1940] AC 231, Viscount Caldecote at 240, observed that ' a full and complete statement of the law' was the hallmark of a code. The provisions of Pt 4 Div 6 satisfy such description. 43. Additionally the challenged provisions of the LEP conflict with the requirements of Pt 4 Div 6. In Morton v The Union Steamship Company of New Zealand (1951) 83 CLR 402 the High Court of Australia stated at 410:- Regulations may be adopted for the more effective administration of the provisions actually contained in the Act, but not regulations which vary or depart from the positive provisions made by the Act … The same principles were expounded by Diplock LJ in Mixnam's Properties Ltd v Chertsey Urban District Council [1964] 1 QB 214 at 237 where His Honour stated:- Parliament can make whatever changes it likes in the law, but subordinate legislative authorities can make only such changes in the law as Parliament has expressly empowered them to make. The proposition that delegated legislation cannot be inconsistent with its enabling Act was confirmed in R v Commissioner of Patents Ex parte Martin (1953) 89 CLR 381 at 396 per Williams ACJ, Fullagar J at 406. 44. The challenged provisions require the applicant to make contributions for the purpose of achieving a social objective, namely to assist in the provision of housing for low income families which is a purpose not contemplated by s 94. Further the measures adopted for their implementation do not conform to the requirements of Pt 4 Div 6 of the Act. It follows that the challenged provisions seeking a contribution, either in kind or in money are otherwise than as provided by s 94(1) of the Act. They are accordingly invalid. Remaining challenges - a tax? 45. A public authority is not permitted to impose a financial burden upon a citizen in the absence of plain and clear statutory language: see Liverpool Corporation v Arthur Maiden Ltd (1938) 4 All ER 200 at 204; Attorney-General v Wilts United (1921) 37 TLR 884 at 885 [affirmed on appeal in Attorney-General v Wilts United Dairies (1922) 91 KJ KB 897 at 900]; Gosling v Veley (1847) 7 QB 406 at 407. The Act does allow for a financial burden to be imposed (see for example s 94). However the applicant submits that the contribution constitutes a tax and since the Act is not a taxation statute the exaction of a contribution is invalid: see Attorney-General v Wilts United Dairies (1922) 91 KJ KB 897 at 900, affirmed in The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922-23) 31 CLR 421 at 444; Hepples v Federal Commissioner of Taxation (1991-1992) 173 CLR 492 at 510 - 511. 46. It is obvious the Act was not intended to operate as a statute for the purpose of taxation. It follows that any condition or provision of a planning instrument that imposes a tax will be ultra vires: see The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd at 444, 445; Hepples v Federal Commissioner of Taxation at 510 - 511. 47. To constitute a tax, the required contributions must satisfy the criteria as identified by the Privy Council in Lower Mainland Dairy Products Sales Committee v Crystal Dairy Ltd [1933] AC 168 at 175. This criteria was adopted by Latham CJ in Matthews v Chicory Marketing Board (Vic) (1938) 60 CLR 263 at 276, namely ' a compulsory extraction of money by a public authority for public purposes enforceable by law and … not a payment for services rendered' . In Air Caledonie International v Commonwealth (1988) 165 CLR 462 at 467 Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ observed that the "Latham formula" ' should not be seen as providing an exhaustive definition of tax.' Their Honours held that:- …a charge for the acquisition or use of property, a fee for a privilege and a fine or penalty imposed for criminal conduct or breach of statutory obligation are other examples of special types of exactions of money which are unlikely to be properly characterised as a tax notwithstanding that they exhibit those positive attributes. The positive attributes consist of a compulsory extraction of money by a public authority for public purposes, as identified by Latham CJ in Matthews v Chicory Marketing Board (Vic) at 276 . 48. In Harper v Minister for Sea Fisheries & Ors (1989-90) 168 CLR 314 the High Court of Australia held that a fee for an abalone licence did not constitute a tax for the reason that a statutory right was provided in return for the charge. In the present circumstances, an applicant who makes the contribution satisfies a possible requirement for development consent in return for the contribution. In Air Caledonie International v Commonwealth at 467 the High Court of Australia observed that if an extraction ' has no discernible relationship with the value of what is acquired ' such an extraction may be classed as a tax. In this instance there is no evidence to suggest that the value of the contribution is grossly disproportionate to the value of the satisfaction of a condition that will enable development. Therefore in accordance with Harper v Minister for Sea Fisheries the contribution does not constitute a tax. 49. Further support for the proposition that the contribution does not possess the character of a tax is found in Rockdale Municipal Council v Tandel , where Glass JA at 204, 206 (with whom Samuels JA agreed) considered that provisions which were designed to merely augment a council's revenue or were for a purpose which a council was not obliged to fulfil would be invalid as an unauthorised tax. However Glass JA (at 206) observed that whilst it would be impossible to justify a collection of money solely for the purpose of augmenting council's revenue, different considerations would arise where a condition required payment of monies for a specific purpose. 50. In Northern Suburbs General Cemetery Reserve Trust v The Commonwealth of Australia (1992-1993) 176 CLR 555 at 570, the challenged legislation sought to impose a charge on employers equivalent to any shortfall in the amount required to be spent by employers in training employees as prescribed by a certain statute. Such provision was held at 570 not to be a fee for services but rather was found to be a tax, since the charges received were not required by the relevant act to be expended on the training scheme. The charge was merely to raise revenue. Unlike the facts in that decision the objects of the affordable housing provisions are specific. Under the LEP, the contribution may be required for the provision of affordable housing. The LEP requires the contribution to be paid to and administered by a housing authority. There is no suggestion that it could lawfully be used for any other purpose than affordable housing as prescribed by the scheme. 51. In Leake v Commissioner of Taxation (State) (1933) 36 WALR 66, Dwyer J at 67 made observations of the indicia of a tax as follows:- A compulsory contribution, or an impost, may be none the less a tax, though not so called; the distinguishing feature of a tax being in fact that it is a compulsory contribution, imposed by the sovereign authority on, and required from, the general body of subjects or citizens as distinguished from isolated levies on individuals… And His Honour continued at 68:- … but I think particular fees, local assessments and tolls are not commonly regarded as included in the general term "taxes," no doubt on account of their restricted incidence, while payments based on the ownership of land or the receipt of income spread throughout the whole community, invariably are. This decision was cited with approval in the judgment of the High Court of Australia in MacCormick v Federal Commissioner of Taxation (1983-1984) 158 CLR 622, wherein at 639 their Honours Gibbs CJ, Wilson, Deane, Dawson JJ stated a characteristic of a tax as follows; ' Liability is imposed by reference to criteria which are sufficiently general in their application and which mark out the objects and subject-matter of the tax: see Federal Commissioner of Taxation v Hipsleys Ltd . '. The challenged provisions do not possess the character of a tax as described in Leake v Commissioner of Taxation (State) at 67, 68; MacCormick v Federal Commissioner of Taxation at 639, because of the restricted incidence of the contribution. 52. In Airservices Australia v Polaris Holding Company [1999] HCA 62; (1999) 74 ALJR 76 the High Court of Australia reviewed its recent decisions relating to the characteristics of a tax, many of which concerned the payment for services. Gauldron J at 99, [132], adopting the definition of a tax as cited in Matthews v Chicory Marketing Board (Vic) at 276 observed that if money was to be exacted by a public sector monopoly, ' the charge inevitably involved practical if not legal compulsion'. The affordable housing provisions do not necessarily involve compulsion since the challenged provisions may only apply if application is made for development in Green Square. 53. For these reasons the Court rejects the submission that the challenged provisions constitutes a tax. Interference with proprietary rights 54. Whilst the challenged provisions do not constitute a tax they impose a financial burden of a kind not envisaged by the Act. Such Act contemplates contributions of the kind referred to in s 94, namely a quantifiable contribution confined to the amelioration of the impact of development. The challenged provisions envisage an applicant may elect to keep title to the land. In this event, an applicant must satisfy council that a management agreement has been made for the management of such housing ' that will fulfil the affordable housing principles set out in cl 27M' of the LEP and ' council will seek the views of the community housing organisation on the appropriateness of the management arrangements proposed' (DCP cl 3.3). These provisions demonstrate that an applicant will be required to subsidise the occupants of the housing set aside as affordable housing indefinitely, at a standard 'consistent with the average standard of contemporary development in the area' (see DCP cl 2.4), and selected by the community housing organisation without any opportunity for the applicant to be heard (DCP cl 3.1). If an owner wishes to sell units allocated for affordable housing, it may do so provided that their use for such purpose continues indefinitely. (DCP cl 3.3). 55. The practical effect of the challenged provisions is that an applicant's property would be controlled by the community housing provider without any compensation. In Belfast Corporation v O.D. Cars Ltd. [1960] AC 490 Viscount Simonds at 517-518 stated: ' It is no doubt, the law that the intention to take away property without compensation is not to be imputed to the legislature unless it is expressed in unequivocal terms. ' This proposition has been affirmed by the High Court of Australia in C.J Burland Pty Limited v Metropolitan Meat Industry Board (1968) 120 CLR 400 at 403, 406, 415. The Act contains no express provisions permitting the acquisition of property without compensation as envisaged by the challenged provisions. Thus if the Act as the enabling statute does not authorise such a power of acquisition the purported authorisation of such power by a subordinate instrument, namely the LEP cannot be valid. The principle has been clearly established that inconsistency between the provisions of a statute and delegated instrument thereunder will result in the invalidity of the inconsistent portion of the instrument (see Morton v The Union Steamship Company of New Zealand at 410). 56. The applicant submits that any condition imposed in reliance on the challenged provisions would be unreasonable in the Wednesbury sense since such conditions would represent an ' oppressive ' or ' gratuitous ' interference with property rights (see Kruse v Johnson [1898] 2 QB 91 at 99). In support of such submission the applicant relies upon Regina v Hillingdon London Borough Council Ex parte Royco Homes Ltd [1974] 1 QB 721 in which a local authority as a condition of development consent required all of the houses in this proposed development to be occupied for a tenure of 10 years by persons on the authority's housing list. Lord Widgery CJ referring to the conditions imposed said at 732:- … they undoubtedly in my judgment are the equivalent of requiring the applicants to take on at their own expense a significant part of the duty of the council as housing authority. However well intentioned and however sensible such a desire on the part of the council may have been, it seems to me that it is unreasonable in the sense in which Willmer L.J. was using that word in Hall's case . 57. Additionally Lord Widgery CJ at 729 - 730, having referred to the relevant planning legislation which allowed a local authority to grant planning permission, ' either unconditionally or subject to such conditions as they think fit… ', drew attention to the limitation on such power as follows:- Those wide words " subject to such conditions as they think fit " confer authority for a wide range of conditions to be attached to planning permissions. However, they are clearly too wide to be given their literal meaning, and a number of years ago they were restricted by a dictum of Lord Denning which is constantly quoted in these matters. The dictum appears in the decision of the Court of Appeal in Pyx Granite Co. Ltd. V. Ministry of Housing and Local Government [ 1958] 1 Q.B. 554. Lord Denning said, at p. 572: "The principles to be applied are not, I think, in doubt. Although the planning authorities are given very wide powers to impose 'such conditions as they think fit,' nevertheless the law says that those conditions, to be valid, must fairly and reasonably relate to the permitted development. The planning authority are not at liberty to use their powers for an ulterior object, however desirable that object may seem to them to be in the public interest." 58. The same observations may be made of a council when exercising power under the provisions of the Act. Section 80 of the Act enables a consent authority to impose conditions upon a development consent. As prevailed in the English Town and Country Planning Act 1971, prima facie there is no limit to the conditions which might be imposed under the Act but implied limits to the exercise of a consent authority's power exist as explained in the above quotation (see Building Owners and Managers Association of Australia Ltd v Sydney City Council at 67; Parramatta City Council v Peterson (1987) 61 LGRA 286 at 293, 294). 59. Reliance was also placed upon the decision in Hall & Co Ltd v Shoreham-by-Sea Urban District Council & Anor [1964] 1 WLR 240 in which the condition of development required dedication of a roadway without compensation. The owner of the road was required to provide the use of such road to the public at large and not just to those connected with the development. The Court of Appeal found that the condition of consent requiring construction of the roadway was a radical departure from the rights of ownership and unreasonable in the Wednesbury sense. 60. In Hall & Co Ltd v Shoreham-by-Sea Urban District Council & Anor Willmer LJ at 247 summarised the effect of Mixnan's Properties Ltd v Chertsey Urban District Council [1964] 1 QB 214 as follows:- I can summarise the effect of what we said under three heads as follows. (1) The conditions must not be such as to effect a fundamental alteration in the general law relating to the rights of persons on whom they are imposed unless the power to effect such an alteration is expressed in the clearest possible terms. (2) The conditions imposed must fairly and reasonable relate to the permitted development. (3) The conditions imposed must not be so unreasonable that it can be said that Parliament clearly cannot have intended that they should be imposed. 61. It has been accepted that a council may impose conditions which interfere with rights, and provided the purpose is valid, the interference will be valid. In Allen Commercial Constructions Pty Limited v The Council of the Municipality of North Sydney (1970) 123 CLR 490 the High Court of Australia (at 499) affirmed the proposition that a condition will be valid if it is reasonably related to the purpose for which the function of the authority is being exercised. However such interference must be related to the development. In Greek Australian Finance Corporation Pty Ltd v Sydney City Council (1972-74) 29 LGRA 130 at 142, Holland J held a condition requiring contribution for parking spaces invalid on the ground that such contribution was not confined to the ' consequences of the development' . 62. The challenged provisions would permit a council to require the applicant, as a condition of development consent, to surrender indefinitely its entitlement to use a portion of its property or to assign such or pay a monetary contribution without receiving compensation. Such contribution is not required to be applied for a consequence of the development but instead is to be applied towards affordable housing, the need for which does not necessarily arise from the development. In Fridrich Contructions Pty Limited v Leichhardt Municipal Council (NSWLEC, 23 December 1982, unreported at 32) Senior Assessor Bignold determined, albeit impliedly, that a condition of development consent which imposed an obligation to provide subsidise housing would be an unreasonable constraint upon an applicant. 63. There is no evidence that any low or low to moderate income family has been or will be displaced by reason of the applicant's proposed development. Rather the required contribution is to be made for the more general purpose of housing low income families. It is estimated that from the proposal to house 22,000 people in Green Square, between 700 and 800 persons will be required to be accommodated in affordable housing. Accordingly the contribution is significant. It cannot be said that the purpose of the contribution is related to the development (see Greek Australian Finance Corporation Pty Ltd v Sydney City Council at 141, 142 and Pyx Granite Co. Ltd. V. Ministry of Housing and Local Government [ 1958] 1 Q.B. 554 at 557). 64. Although the council submits that the introduction of the Act heralded a new approach in town planning, I do not think that the New South Wales Parliament intended that well established principles relating to the limitation of powers of a local authority and to discrete issues of fundamental proprietary rights which have been enshrined in the common law were to be discarded by the operation of the Act. Certainly Cripps J in Building Owners and Managers Association of Australia Ltd v Sydney City Council at 67 relied upon such principles when considering the impact of contributions under s 94 of the Act (see also Parramatta City Council v Peterson (1987) 61 LGRA 286 at 293, 294), and the High Court of Australia in The Commonwealth of Australia v The State of New South Wales (1923-24) 33 CLR 1 at 42 has recognised the common law right of an owner to exercise dominion over their property. Accordingly the conditions envisaged by the challenged provisions constitute an unauthorised interference with proprietary rights in the same manner as was found in Regina v Hillingdon and Hall v Shoreham-by Sea Urban District Council at 256 and are thus unreasonable within the Wednesbury sense. Interference with Council's discretion 65. By virtue of s 79C(1)(a) of the Act a consent authority when considering an application for development is required to consider, inter alia, the provisions of any environmental planning instrument and of any development control plan. 66. The applicant submits that the affordable housing provisions of the LEP operate as an unlawful fetter on the council's exercise of discretion pursuant to s 79C since the challenged provisions require a contribution when an application for development in Green Square is considered irrespective of the individual circumstances of the application. 67. Clause 27O of the LEP provides that council ' must take into consideration ' the affordable housing scheme before granting consent to a proposed development in Green Square. Whilst this provision operates as a pre-condition to consideration of development consent in that it requires the council to direct its mind to the concept of affordable housing before the granting of any such consent, technically it does per se restrict the council's ability to determine the merits of any proposed development. Such condition precedents have not been treated as a fetter on council's discretion; see Franklins Limited v Penrith City Council and Campbells Cash & Carry Pty. Limited ([1999] NSWCA 134, NSW Court of Appeal, unreported 13 May 1999, at para [26] and [27], Currey v Sutherland Shire Council (1998) 100 LGERA 365 at 372 and 374). 68. Clause 27R of the LEP states that a council ' may impose conditions ' in furtherance of the objectives of affordable housing. Unlike the mandatory phraseology of the provisions struck down as being an unlawful fetter by Cripps J in Building Owners and Managers Association of Australia Ltd v Sydney City Council at 68 the conditional language of the LEP evidences the council's ability to determine an application on its merits. Accordingly this ground of challenge is rejected. Discriminatory nature of LEP 69. With regard to the alleged discriminatory nature of the LEP the applicant relies upon Mixnam's Properties Ltd v Chertsey Urban District Council at 237. Mixnam's is authority for the proposition that the exercise of delegated authority must be free from 'arbitrariness or partiality': see Prasand v Minister for Immigration and Ethnic Affairs (1986) 65 ALR 549 per Wilcox J at 562. 70. The challenged provisions clearly outline the development criteria that council may apply to a proposed development in Green Square. That such criteria differ depending on the exact locality and nature of a proposed development is not indicative of partiality or arbitrariness but rather reflects that the LEP is a planning instrument. A planning scheme necessarily acknowledges that different localities may require diverse planning treatment. In this instance council has identified Green Square's proximity to the economic centres of Sydney and new transport facilities as the reason for its diverse treatment when compared to other areas affected by the LEP. Accordingly the LEP is not discriminatory in nature. This ground of challenge fails. Severability 71. It is necessary to consider whether the whole or only part of the LEP is invalid. This consideration in turn requires an examination of the remainder of the provisions of the LEP, in order to determine whether the invalid sections are severable ( Dunkley v Evans (1981) 1 WLR 1522 at 1524-1525). 72. The challenged provisions are inextricably connected with the remainder of the LEP such that the residue of the LEP after the excision of the invalid provisions would be ineffectual for any purpose. In accordance with the principles in Olsen v City of Camberwell [1926] VLR 58 at 68 and the authorities considered by Pearlman J in Darling Casino Ltd v Minister for Planning and Sydney Harbour Casino Pty Ltd (1995) 86 LGERA 186 at 206, 207, the whole of the LEP is invalid. It is obvious that the Minister would not have made the plan in the absence of the challenged provisions and in these circumstances no part of it can survive. The DCP is invalid 73. The DCP is dependent upon the provisions of the LEP. Pursuant to s 72 of the Act a development control plan is to provide more detailed provisions than are contained in the relevant local environmental plan (see Big Country Developments v Penrith City Council (Pearlman J, NSWLEC, 8 December 1997, unreported at 6) and therefore its operation is predicated upon the validity of the LEP. Accordingly it must follow that the DCP is also invalid. 74. The Minister has raised for consideration the status of certain State Environmental Planning Policies ('SEPP'), such as SEPP 5 relating to housing for the aged and disabled, and SEPP 9 relating to group homes. It is not however necessary for the Court to embark upon an investigation of their validity, since they are not the subject of challenge in these proceedings. Conclusion 75. The findings of this Court do not address the merits of the affordable housing provisions but are concerned solely with the legality of the LEP and of the DCP. The affordable housing scheme contained in the LEP cannot be sustained because it does not comply with the objects of s 5 of the Act and infringes Pt 4 Div 6 thereof. Additionally it represents a fundamental interference with proprietary rights and is thereby unreasonable in the Wednesbury sense. New legislation will be required if it is sought to maintain a scheme for affordable housing. 76. The report entitled "Affordable Housing in New South Wales - The Need for Action", prepared by Julian Disney, Chair, The New South Wales Ministerial Task Force on Affordable Housing (October 1998) stated in its proposals inter alia:- The Environmental Planning and Assessment Act should explicitly empower planning authorities to require affordable housing quotas as conditions of approval for particular developments … A Bill entitled Environmental Planning and Assessment Amendment Bill 1999 proposes to make affordable housing an object of the Act. The Court makes no comment upon such Bill, other than to observe that at present the Act does not include affordable housing as one of its objects. Orders 77. The Court makes the following declarations and orders:- 1. A declaration that the South Sydney Local Environmental Plan 1998 (Amendment No 2) - Green Square is invalid. 2. A declaration that the Green Square Affordable Housing Development Control Plan 1999 is invalid. 3. Costs be reserved. 4. Exhibits be returned. 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.