Reported Decision : 115 LGERA 108 Land and Environment Court of New South Wales CITATION : The Turnbull Group Pty Limited v Hornsby Shire Council [2001] NSWLEC 153 APPLICANT The Turnbull Group Pty Limited PARTIES : RESPONDENT Hornsby Shire Council FILE NUMBER(S) : 10229 of 2001 CORAM: McEwen AJ KEY ISSUES: Construction and Interpretation - Question of Law :- preliminary question of law - application of a standard - whether a standard is a prohibition LEGISLATION CITED: Environmental Planning and Assessment Act 1979, s 35, s 36 Interpretation Act 1987, s 32 Bowen v Willoughby City Council (2000) 108 LGERA 149; Cooper Brooks (Wollongong) Pty Limited v The Commissioner of Taxation (1981) 147 CLR 297; Grech v Bird and Anor (1936) 56 CLR 228; CASES CITED: K and S Lake v City Freighters Pty Limited (1985) 157 CLR 309; Ku-ring-gai Municipal Council v Kuttner (1980) 41 LGRA 1; North Sydney Municipal Council v PD Mayoh Pty Ltd [No 2] (1990) 71 LGRA 222; Stock v Frank Jones (Tipton) Ltd [1978] 1 WLR 231 DATES OF HEARING: 02/07/2001 DATE OF JUDGMENT: 07/03/2001 APPLICANT Mr M Craig QC SOLICITORS Staunton Beattie LEGAL REPRESENTATIVES: RESPONDENT Mr C J Leggat (Barrister) SOLICITOR Ian Woodward Principal Solicitor Hornsby Shire Council JUDGMENT: IN THE LAND AND 10229 of 2001 ENVIRONMENT COURT McEwen AJ OF NEW SOUTH WALES 3 July 2001 The Turnbull Group Pty Limited Applicant v Hornsby Shire Council Respondent JUDGMENT 1. These proceedings have been referred for decision on a point of law identified by Talbot J as "whether the proposed development is a prohibited development pursuant to clause 22(1) of the Hornsby LEP 1994" ("HLEP 1994"). 2. On 14 December 2000 the applicant lodged a development application for the property at No 1A Chapman Avenue, Beecroft, where a dwelling-house has been erected, to enable its use for the purpose of professional offices. The respondent Council refused the application on 13 March 2001. These class 1 proceedings were brought against that refusal and were commenced on 5 April 2001. 3. The property at No 1A Chapman Avenue, Beecroft, resulted from a subdivision of the property previously known as No 27 Wongala Crescent. As at 27 July 1994 No 27 Wongala Crescent was some 1,303 square metres. On that day HLEP 1994 was gazetted. Pursuant to cl 7 of HLEP 1994 No 27 Wongala Crescent was zoned "Residential AS (Low Density - Sensitive Lands)". Development under that zone was permitted for a variety of uses concomitant with residential use. Without consent home occupation was permitted. The dictionary to HLEP 1994 circumscribed home occupation in a variety of ways including but not limited to a constraint on the persons employed - they needed to be residents; and the area of the operation was not to occupy more than 50 square metres. The floor space ratio ("FSR") of the lands zoned Residential AS (and relevantly No 27 Wongala Crescent and hence No 1A Chapman Avenue), for purposes permitted under the zoning is 0.4 to 1. 4. The application in these proceedings is for the use of a lot subdivided out of No 27 Wongala Crescent to be used for professional offices. The claimed entitlement for that use is pursuant to an exception contained in cl 22 of HLEP 1994. Clause 22 is headed "Exceptions", with a further subheading "Objective of Provision" which reads: To provide exceptions that allow or prohibit land uses and other development in accordance with the overall objectives of this plan. Clause 22 then subdivides into two subsections, firstly "Exceptions" and secondly "Prohibitions". Under "Exceptions" it reads: Regardless of any other provision in this plan, the following land uses and other development are permitted with the consent of the Council in accordance with the following Table: 5. The table is then set out in three columns, the first being "Address/Area", the second "Land Description" and the third "Permitted Land Use or Other Development". Under "Address/Area" the relevant addresses given for the purposes of these proceedings are numbers 23, 25 and 27 Wongala Crescent, Beecroft. The land description contained in the second column identifies four titles, being lot Y DP380446, lots 7 and 8 DP758074 and lot 1 DP951303. 6. Under the third column "Permitted Land Use or Other Development" the column reads relevantly: Office premises with dwelling-houses where the floor space ratio for all buildings does not exceed 0.3 to 1. 7. The last identified title in the second column to the table, namely lot 1 in DP951303 was by DP1008775 registered on 18 January 2000, subdivided into three lots. Of those three lots the property which is the subject of the present application in these proceedings is lot 3, that is lot 3 in DP1008775, that property being commonly known as No 1A Chapman Avenue. To understand the arguments advanced by the parties it is necessary to have regard to the floor space ratios of each of the properties identified in cl 22 of HLEP 1994. A table from the agreed statement of facts set out those floor space ratios as follows. Street No Site Area Floorspace FSR 23 1338m2 142.1m2 1.10:1 25 1450.9m2 224.1m2 0.15:1 27A 415.4m2 101m2 0.24:1 27B 432.9m2 120m2 0.27:1 1A 455.1m2 146.18m2 0.32:1 Total 4092m2 733.38m2 0.18:1 8. From an agreed statement of facts the following emerges:- (i) the FSR of the property at 1A Chapman Avenue is 0.32 to 1. (ii) the FSR of the three lots in the most recent subdivision contained in DP1008775, that is the previous lot 1 in DP 951303 is 0.28 to 1. (iii) the aggregate FSR's of all buildings on the three lots identified originally in cl 22 of HLEP 1994 namely lots 1, 2 and 3 in DP1008775 and lots Y in 380446 and lots 7 and 8 in DP758074 is 0.18 to 1. Statutory Framework 9. I have referred (par 3) to the zoning of the lands the subject of the exception contained in cl 22 of HLEP 1994. Under cl 7 of HLEP 1994 the proposed use of offices within dwelling houses is prohibited other than the extent I have identified relating to home occupation. Clause 4(5) of HLEP 1994 deals with "Relationship to Other Planning Instruments". It reads relevantly: For the purpose of State Environmental Planning Policy No 1 - Development Standards the provisions of clauses 14, 15 and 20 and Schedule B which specify numeric criteria are intended to be development standards. Other provisions within this instrument which specify numeric criteria are not intended to be development standards for the purposes of State Environmental Planning Policy No 1 - Development Standards. 10. I have also recited the provision relevant to these proceedings contained in cl 22 of HLEP 1994 (para 4). Definitions in the dictionary to HLEP 1994 relevant to construing cl 22 are as follows: floorspace ratio - in relation to a site, means the ratio of the gross floor area of any building or buildings on the site to the site area. site area - in relation to development, means the area of land to which an application for consent to carry out the development relates, exclusive of any land on which the development is not permitted by or under an environmental planning instrument. office premises - means a building or place used for the purpose of administration, clerical, technical, professional or like activities (except dealing with members of the public on a direct and regular basis or otherwise than by appointment), but does not include a building or place elsewhere defined in this clause. Construction of clause 22(1) 11. The question posed for consideration is whether the provision relating to the permitted land use, namely office premises, as identified in cl 22, applies as Mr Craig submits such as to be calculated on the composite area of all land described by the addresses and land description and title references in the table to cl 22; or as Mr Leggat submits, for it only to be calculated by reference to the area of individual parcels or lots within the conglomerate area. 12. For the purpose of divining what the draftsman of HLEP 1994 intended, I have been enjoined to look first to the context in which the words in cl 22 appear. In that regard reference was made to the judgment of Sir Anthony Mason in K and S Lake v City Freighters Pty Limited (1985) 157 CLR 309 at 315 and also the judgment in Cooper Brooks (Wollongong) Pty Limited v The Commissioner of Taxation (1981) 147 CLR 297 at 304 and at 319 to 320. 13. Sir Harry Gibbs, the Chief Justice, in the Cooper Brooks matter observed: It is only by considering the meaning of the words used by legislature that the Court can ascertain its intention and it is not unduly pedantic to begin with the assumption that the words mean what they say.(at p 304) On the following page his Honour said the following: However, if the language of a statutory provision is clear and unambiguous and is consistent and harmonious with the other provisions of the enactment and can be intelligibly applied to the subject matter with which it deals it must be given its ordinary and grammatical meaning even if it leads to a result that may seem inconvenient or unjust. 14. Mr Craig for the applicant submitted that the words used in cl 22 are clear and unambiguous. He says that the language of the clause directs us to consider the aggregate floor space ratio to determine whether or not the application for consent for use of a dwelling-house for office premises is permissible or not. He said that the reference to "office premises with dwelling houses" emphasising the, plural, "premises" and "houses", directed attention to all buildings, plural, on the conglomerate lands identified in cl 22. And that to the contrary such language would not accommodate an interpretation limiting the application of the benefit of the section to each building or separate building on separate allotments, or the separate lots or properties, as identified to a maximum floor space ratio of 0.3 to 1 for each of those properties. 15. Mr Craig submitted that had the drafter of cl 22 intended that the individual dwellings proposed for use as office premises be so limited then the clause would have been differently expressed. In the context of that language he submitted that the ratio found in Cooper Brooks meant that "consistently and harmoniously with" the way in which the remainder of the table in cl 22 is framed directed a conclusion in favour of a construction for the ratio, that is the FSR ratio of 0.3 to 1 to be applied to the aggregate area. In this he was referring to the fact that a variety of other exceptions provided for in cl 22 identify a number of different properties where the beneficial provision of the exceptions applies to more than one parcel of land for a particular use; or put another way that several allotments are identified as having the benefit of those further uses. 16. In that context he submitted that the contiguous properties, 23, 25 and 27 Wongala Crescent, Beecroft, being grouped as they are for a particular purpose suggested that the formula of the floor space ratio was to be applied in aggregate across the whole area, and that the intent was not to limit the floor space ratio of the individual allotments but rather to limit the overall office space used in all of the premises on the conglomerate area. In that regard he referred to the decision of the Court of Appeal in Ku-ring-gai Municipal Council v Kuttner (1980) 41 LGRA 1. That decision dealt with the need to construe the difference between the description of a "parcel" of land and an "allotment" of land for the purpose of giving effect to a provision in the Ku-ring-gai Planning Scheme Ordinance. Mr Craig said he placed reliance on that decision and although it was not ventilated in argument I take it that he was referring in particular to the decision by Mr Justice Hutley found at page five (5) of that decision. 17. In answer to these submissions Mr Leggat said that the result of a construction of the type Mr Craig contended for, would be a denuding or reduction of the right of other proprietors of properties identified in cl 22 to enjoy development for office premises up to the prescribed limit of the FSR of 0.3 to 1. This is because the enjoyment by one of the properties, here No 1A Chapman Avenue, of an FSR above that constraint necessarily means that when the formula is applied over the area remaining those other properties will have a lesser entitlement to development for office premises purposes. This Mr Leggat submits could and would lead to a "race to the register" as he described it and that the first in the queue would to use his words, "eat up" as much of the entitlement as possible leaving little or no entitlement to that or those properties who may apply later. In support of this submission he pointed to the residential development FSR for the zoning of this land being 0.4 to 1. 18. Mr Leggat says that recourse can be had to the definitions in the dictionary to HLEP 1994 to assist in the construction of the words in cl 22. He contends that the application of those definitions lead to a construction of cl 22 that limits its application to "any" of the individual properties or lots identified as having the benefit of cl 22 as separate entities. The words in cl 22 which pick up words in the definition are the words "office premises" and "floor space ratio". In turn, the definition of floor space ratio picks up the definition of "site" and "site area". When the words of cl 22 are amplified to include the words in the definitions for floor space ratio and site area Mr Leggat submits that the application of the beneficial exception in cl 22 is seen to be limited to the individual or separate lots and not the conglomerate area. Relevantly, he emphasises that the definition of floor space area talks of "any building or buildings" on the site and the definition of site area talks in terms of the particular site, the subject of an application for consent. 19. In answer to this Mr Craig points to the words simpliciter of cl 22. It deals he says with "lands" as identified in the table. The permission granted is for a use, namely office premises, within "dwelling-houses" and it fixes the FSR for "all buildings". Its terms are plural and not singular. This he submits leads to a construction not limiting the application to the individual separate properties or lots, but rather directs a conglomerate construction. 20. The question arises as to whether the literal construction which Mr Craig contends for produces a capricious or unjust result, or a construction contrary to the legislative intent or objectives of HLEP 1994. 21. Mr Leggat suggests recourse to the mischief rule (now subsumed to a degree in the purposive approach; (see Pearce and Geddes Fourth Edition at par [2.2] Stock v Frank Jones (Tipton) Ltd [1978] 1 WLR 231 at 236). This tool to construction is available when the literal approach produces ambiguity or inconsistency. However, to pose the question "what mischief did clause 22 intend to cure?" or "what was the objective or purpose of clause 22?" does not resolve the ambiguity created by the words of the clause. One is still left with the question as to whether the legislative intent was to limit the extent of office premises each of the separate constituent allotments, contrasted with a limit on the overall areas of the composite allotments. The plain words of cl 22 result in contextual ambiguity between three competing constructions. Firstly, one has "all" the three properties as separate components, secondly one has "all" the properties as a conglomerate and thirdly, one has "all" or any of the three properties or four titles or lots having been subdivided out of them or amalgamated one with the other, such as to result in a different configuration of titles within the overall area of the original titles. 22. However the words of cl 22 being in the plural when referring to the dwelling-houses and all "buildings", and not being circumscribed by reference to singular individual allotments or land titles does not necessarily lead to the conclusion Mr Craig contends for. Given the prospect of conveyance to different entities and the possibilities both of subdivision and amalgamation of the lands identified in cl 22, it could not in my opinion have been the intent of the drafter of the instrument to give a benefit to one owner at the expense of another. For this reason I conclude that the benefit of cl 22 relevantly does not apply to the aggregate area but rather to the separate lots which comprise, or may comprise, that area. This of itself may lead to a difficulty in so far as the table to cl 22 identifies four separate lots. However, the entitlement to those separate lots would run in tandem when either their subdivision into smaller allotments occurred, or upon amalgamation. 23. If I am wrong in this view, and if the construction for which Mr Craig contends is correct then the resubdivision of any of these lands could or would detrimentally impact a prospective entitlement which the proprietors of lots 23 and 25 presently enjoy. A finding that the 0.3 to 1 FSR is to be calculated on the basis of the conglomerate area of 23, 25 and 27 Wongala Crescent (and now with the additional three lots comprising the former No 27) then with the FSR of No 1A Chapman Avenue now at 0.32 to 1, necessarily the opportunity and capacity of the other lots of the conglomerate area to enjoy the exception provided for in cl 22 is reduced. 24. However, the Court has not heard from the proprietors of Nos 23 and 25 Wongala Crescent and there is no evidence that they have been notified of this application or of the argument to which I have just referred. Procedural fairness requires that persons whose interests may be affected by findings of this nature be given notice sufficient to enable them to consider if they wish to be heard, and if so an opportunity to do so. Hence, if I am wrong in the view I take in relation to the first issue and if this particular topic is to be ventilated again, these other proprietors would need to be notified and be given an opportunity to be heard. Clause 22: A Standard or a Prohibition 25. Is the floor space ratio identified in cl 22 a standard or a prohibition? The applicant says that if its primary submission fails then cl 22(1) of HLEP 1994 is a development standard amenable to State Environmental Planning Policy No 1. Reference is made to the definition of "development standard" in the Environmental Planning and Assessment Act 1979 (EP&A Act) viz:- development standards means provisions of an environmental planning instrument or the regulations in relation to the carrying out of development being provisions by or under which requirements are specified or standards are fixed in respect of any aspect of that development including but without the generality of the foregoing requirements or standards in respect of… (it then refers in subparagraphs (a) through to (o) to a series of examples, some numerical, some going to particular use, and others to amenity). 26. Mr Craig submits that the limitation contained in the words in cl 22(1) of HLEP 1994 is language which is not prohibitory. He submits the provision in cl 22(1) is one by which "standards are fixed" in respect of an aspect of development for office premises. He says that the provision indicates the particular extent to which the development in the form of office premises can be carried out on the nominated parcel of land. 27. Mr Leggat says in answer that cl 4(5) of HLEP 1994 (par 9 above) overrides any inquiry into the question of whether or not cl 22 (par 4 above) works by way of a prohibition or standard. The question is which of cl 4(5) or cl 22 is subservient to the other; alternatively, which provision is to prevail over the other. 28. Mr Craig submitted that the words of cl 22(1) are not to be construed as a prohibition but rather as a standard. Firstly, he points to the opening word of cl 22(1) which reads "regardless of any other provision in this plan…". The meaning of the word "regardless" is plain, and in my opinion is intended to give cl 22 superiority to all other provisions including the provisions as to "Relationship to other Planning Instruments" referred to in cl 4(5) of HLEP 1994. 29. Secondly, Mr Craig submitted that in so far as cl 4(5) purported to limit the application of the statutory definition of "development standard" in the EP&A Act, he says it cannot run. He submits that an environmental planning instrument (a form of delegated legislation) cannot work to modify the definition in the EP&A Act, and an attempt to do so in the present manner would be ineffective; he says it would be ineffective for an LEP of the present type to seek to change the definition of "development standard" in that Act. He called in aid s 32 of the Interpretation Act 1987 to support the submission that no power here is conferred under HLEP 1994 to alter the statutory definition found in the EP&A Act. That approach is consistent with the principle that delegated legislation will be ineffective if it attempts to vary or depart from a positive provision of the Act itself (Grech v Bird and Anor (1936) 56 CLR 228 per Dixon J at 239 to 240). 30. Thirdly, Mr Craig submitted that in relation to this last matter and also in relation to SEPP 1, that s 36 of the EP&A Act itself works to ensure that both the statutory definition in the Act and the provisions of SEPP 1 prevail over an environmental planning instrument, here HLEP 1994, where there is inconsistency. This he said leads to the conclusion that if the floor space limitation is a development standard it is then amenable to the provisions of SEPP 1, not withstanding cl 4(5) of HLEP 1994. 31. In reply Mr Leggat contrasted the operation of the internal provisions of cl 4(5). On one hand development standards are identified as applying relevantly to the provisions of clauses 14, 15 and 20 and Schedule B of HLEP 1994, but on the other hand in the balance of the instrument specific numeric criteria in other provisions of HLEP 1994 are stated "not to be intended to be development standards for the purpose of SEPP 1". This he said showed a clear intent not to allow the provisions of HLEP 1994, other than those identified, to have the benefit of SEPP 1. He submitted that cl 4(5) itself provided a manner of resolution of conflict by simply precluding a recourse to SEPP 1. This approach however in my view falls foul of the provisions of s 36 of the EP&A Act. 32. Further, Mr Leggat submitted that what the applicant was seeking to do in submitting that cl 4(5) was ineffective was to challenge the validity of that clause. This he said would be proscribed by s 35 of the EP&A Act. However, to argue a point of inconsistency between provisions where there may be resolution by construction does not in my view amount to a challenge to the validity per se of cl 4(5). 33. Mr Leggat submitted that express words could be used in an LEP to state whether or not a provision was a development standard. In my view that is not what has occurred here. The plain words of cl 4(5) do not work by way of prohibition, but are merely a stated intention which is in stark contrast to the forms of prohibitions of particular development one finds in other instruments. Mr Leggat went on to submit that if Mr Craig's submission was correct it would not be possible in the future for a council to fix an FSR in terms other than a development standard; and that this would result in a floor space ratio always being amenable to an objection under SEPP 1, notwithstanding a council intending to expressly prohibit such a result. In my view that is not the case and in particular it is not the case in the instant circumstances. 34. Here, there seems to me to be good and proper grounds for concluding that the provisions in cl 22 are a development standard amenable to the provisions of SEPP 1. Firstly, reference should be made to the use of the word "regardless" in the opening paragraph of cl 21. I have referred earlier to the plain meaning of that word. Secondly, neither cl 4(5) of HLEP 1994 nor SEPP 1 could or should be read down in my view as the council contends. Clause 4(5) in talking in terms of "not intend to be development standards" does not in my view seek to raise a prohibition; if it did it would arguably be in conflict with both the EP&A Act and SEPP 1. Section 36 of that Act ensures that in those circumstances the Act and SEPP 1 will prevail. Further, regard can be had to the fact that cl 22 itself is so framed that the first subparagraph deals with exceptions, and the second subparagraph with prohibitions. If the intent of the drafter, and indeed of the Minister, was to raise a prohibition in relation to the FSR for the use of office premises for the lands identified, then one would have anticipated that the way in which that constraint of a fixed criteria was to operate i.e. as a prohibition and not as a standard would have been dealt with differently. 35. The words of cl 22 do not in my view prohibit but rather permit development for the stated purpose. To apply the words of Mahoney J, the clause permits: "…development to be carried out in a particular way or to a particular extent" (North Sydney Municipal Council v PD Mayoh Pty Ltd [No 2] (1990) 71 LGRA 222 at 234, see also Bignold J's decision in Bowen v Willoughby City Council (2000) 108 LGERA 149 at par 36 - 74. 36. Hence, in my view the question posed by Talbot J is to be answered in the negative. The proposal is not prohibited by cl 22 of HLEP 1994, and I find that the provisions of cl 22 to be a development standard amenable to the provisions of SEPP 1. I make no order as to costs. 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.