Land and Environment Court of New South Wales CITATION : Charny Holdings Pty Limited v Ku-ring-gai Council [2006] NSWLEC 752 APPLICANT Charny Holdings Pty Limited PARTIES : RESPONDENT Ku-ring-gai Council FILE NUMBER(S) : 10683 of 2006 CORAM: Moore C KEY ISSUES: Development Application :- LEGISLATION CITED: Environmental Planning and Assessment Act 1979 Ku-ring-gai Planning Scheme Ordinance 1971 Stockland Development Pty Limited v Manly Council (2004) NSWLEC 472; CASES CITED: Blackmore Design Group Pty Limited v North Sydney Council (2001) 118 LGERA 290; Briginshaw v Briginshaw (1938) 60 CLR 336 DATES OF HEARING: 13 November 2006 EX TEMPORE JUDGMENT DATE : 11/15/2006 APPLICANT Mr J Robson SC INSTRUCTED BY Herbert Geer & Rundle LEGAL REPRESENTATIVES: RESPONDENT Mr D Wilson, barrister INSTRUCTED BY Wilshire Webb JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES MOORE C 15 November 2006 06/10683 Charny Holdings Pty Limited v Ku-ring-gai Council JUDGMENT This decision was given as an extemporaneous decision. It has been revised and edited prior to publication. The consequence of the Court's decision in this appeal is the grant of development consent subject to detailed conditions. These conditions are not reproduced as part of this decision but are available for inspection at the Council. In addition, a copy the Court's Orders and the conditions may be obtained from the Court's registry upon payment of a fee. Details of the fee payable and process for obtaining a copy of the Orders and conditions are available on the Court's web site at http://www.lawlink.nsw.gov.au/lec/ 1. COMMISSIONER: This is an appeal pursuant to s 97 of the Environmental Planning and Assessment Act 1979 (the Act) against the deemed (and subsequent actual) refusal by Ku-ring-gai Municipal Council (the council) of Development Application 581/06 for alterations and additions to an existing Coles Supermarket located on the corner of Ray Street and Forbes Lane, Turramurra (the Coles site). 2. The application proposes an increase, as originally lodged, of 928 square metres in gross floor area, resulting in a total gross floor area of 2580 square metres. The application includes provision of basement car parking underneath the development. 3. The application was lodged with the council on 13 June 2006; was notified in accordance with the council's policy; and the council received twenty-one supporting submissions and one objection. 4. The Coles site is known as 1 Ray Street, Turramurra, and is Lot 1 DP 221290. The Coles site has frontages to Ray Street, to the west, and Forbes Lane, to the south. It adjoins the council's library and has significant open public car parking to the east and to the north. 5. The present Coles Supermarket on the site, according to the evidence given by residents, has operated for a significant period of time; on some views, up to thirty years. It was also the evidence that this supermarket has entitlements, pursuant to its lease, to remain on either a term or options for at least a further twenty-eight years if it wished to do so. 6. The building is single storey, although there is a limited open car park space underneath at the rear at the present time. 7. The Coles site is located on the north-western extremity of the Turramurra town centre – the Turramurra town centre being in two halves, one to the north of the railway line and the other to the south. Both supermarkets serving Turramurra are located, at the present time, on the land in the northern portion of the Turramurra town centre. 8. The Coles site is presently zoned Business 3A(a)(2) Retail Services pursuant to the provisions of the Ku-ring-gai Planning Scheme Ordinance 1971 (the KPSO), and the proposal is permissible under the present terms of the KPSO. 9. There are, in this appeal, no significant merit issues and no significant non-compliances with any numerical requirements of the KPSO or any other planning document for the development. 10. There are no unable to be resolved traffic, parking or minor design issues in the proceedings. 11. Even if they are not resolved, it is not put by the council that any one of them, nor cumulatively, would such matters warrant refusal of the application. 12. It is important at this stage to note two things. 13. The first is what the appeal is about. 14. Mr Wilson, counsel for the council, put two propositions to me: o first, that the proposal was contrary to matters dealt with in the decision of McClellan CJ in Stockland Development Pty Limited v Manly Council (2004) NSWLEC 472, to which I will return, in that there was a settled council policy and the present application was contrary to it; and o second, he put that the application, at least in the significant respect concerning floor space ratio, is contrary to the provisions of a draft Local Environmental Plan which will amend the KPSO – being a draft Local Environment Plan for the Turramurra town centre. 15. He put that this draft Local Environmental Plan is both imminent and certain, and therefore should be given determinative weight, and that, as a consequence, the breach of the FSR provision is therefore fatal. 16. The second thing that it is important to note is what this appeal is not about. 17. This appeal is not about whether or not the proposals contained in the draft Local Environmental Plan do or do not have planning merit, either as a general planning regime for the Turramurra town centre, or, as was attempted to be put to me on site by a number of objectors, as an appropriate general planning regime for the Ku-ring-gai Municipality. 18. As I informed the resident objectors, if I were to deal with any of those matters in this appeal, I would be, in my opinion, committing a significant jurisdictional error. 19. The resident evidence that was given during the course of the site view fell into two parts. 20. The first part is clearly impermissible and inappropriate as it related to general planning policy matters. I have, as I indicated I would do, had no regard to that evidence in reaching my conclusion in these proceedings. 21. The second element of the evidence that was given on site was that, contrary to the usual experiences of members of this Court, those who attended on behalf of the community to give evidence were unanimously in favour of the merits of the application for a variety of reasons. 22. I turn first to the matters raised by Mr Wilson arising out of Stockland. He particularly put to me the matters that were dealt with in paragraph 92 of the decision, which reads: To my mind, the matters which are relevant when determining the weight to be given to a planning policy adopted by a council are as follows: o the extent, if any, of research and public consultation undertaken when creating the policy; o the time during which the policy has been in force and the extent of any review of its effectiveness; o the extent to which the policy has been departed from in prior decisions; o the compatibility of the policy with the objectives and provisions of relevant environmental planning instruments and development control plans; o the compatibility of the policy with other policies adopted by a council or any other relevant government agency; o whether the policy contains any significant flaws when assessed against conventional planning outcomes accepted as appropriate for the site or the area affected by it. 23. With respect to the six matters contained in his Honour's decision in that paragraph, I accept that the first of them – that is, the requirement for research and public consultation to be undertaken when creating a policy, has been satisfied in the present instance. 24. However, with respect to the second of them - that is, the time during which the policy has been in force and the extent of any review of its effectiveness, I am not prepared to give any weight to the policy on that basis. I so conclude because, at the very earliest, the policy could have been regarded as having come into effect from the meeting of the council which took place on 13 November, to which I will later refer. 25. As a consequence, I am satisfied that it is not a long settled and consistently applied policy of the council and therefore should be given little weight. I therefore do not need to consider the relevance or otherwise of any of the other points, save as to note, obviously, that there have been no prior decisions of implementation with respect to it. 26. The second of the matters that was put by Mr Wilson was inconsistency with the draft Local Environmental Plan. 27. The process leading up to the making of this plan commenced on 27 May 2004, when the Assistant Minister for Planning directed the council to prepare plans which effectively dealt with increased housing and general revitalisation issues in its key commercial centres. 28. An appropriate direction was given under s 55 of the Act requiring this and a process has been undertaken dealing with all six town centres within the municipality. 29. There has been a timetable set by the Minister and the council appears to be attempting to meet it. 30. The critical one of these plans in these proceedings concerns the Turramurra town centre. 31. A final version of the draft Local Environmental Plan was adopted by the council at a lengthy meeting taking place on the night of 13 and the early morning of 14 November. 32. A copy of the consolidated resolution passed by the council at this meeting – which took place after the proceedings concluded – but pursuant to leave granted to the council during the proceedings to do so, has been provided to me. 33. I am satisfied, with respect to paragraphs (a) and (b) of that resolution, that the council has adopted the draft LEP for Turramurra, including a number of amendments (which do not appear to impact on the Coles site), and that they have resolved, in paragraph (b), to submit the plan to the Director-General pursuant to s 68 of the Act, accompanied by a request that the plan be made. 34. I am also satisfied, to the extent that it might have relevance in these proceedings, that paragraphs (g) and (h) of the council's resolution also record the adoption of the draft Development Control Plan that will deal with the Turramurra town centre and that it be notified, as required by section 25AB of the Environmental Planning and Assessment Regulation 2000, and that notice will be given to the public that the development control plan will come into effect from the date of gazettal of the relevant LEP. 35. The fundamental matters that cause the inconsistency to arise is a reduction proposed in the draft Local Environmental Plan for retail floor space. At present, the KPSO permits development of a floor space ratio of 1:1 on the Coles site and the draft LEP would, although increasing the overall permitted floor space ratio of the Coles site significantly, reduce the permitted retail floor space to a ratio of .55:1. 36. This reduction, if it were to be applied in the present circumstances, would mean that there would be a 538 sq m non-compliance of that for which the application seeks approval, contrary to the provisions of the floor space ratio provisions in the draft Local Environmental Plan. 37. I note, although I only do so in passing, that, if the draft LEP were in force, an objection pursuant to State Environmental Planning Policy No 1 (SEPP 1) would be available to the applicant to pursue to set aside that limitation. 38. However, I have no regard to any hypothetical SEPP 1 objection in these proceedings as there is none before me. 39. In addition, the draft LEP proposes a five-storey height limit for the Coles site, with an aspiration that that be for shop top housing. 40. In that regard, I note the report of Ms Francis, the Court-appointed town planning expert, who commented in this regard: It is fair to suggest that, should the subject proposal proceed, it is unlikely that residential will be erected on the upper levels. The reasons for this would be the undesirable future potential conflict of uses, which she then proceeded to detail. 41. I am satisfied that it is equally true that, if the present supermarket were to continue on its site, Ms Francis's comments with respect to the unlikelihood of future residential above the supermarket are equally applicable for the reasons that she has given. 42. As I earlier noted, the operation of the supermarket has been on the Coles site for some thirty years and potentially has twenty-eight years to run. There is no evidence that the supermarket is not viable. There is no evidence that the supermarket would remove itself if this appeal were to be refused, and there is no evidence as to any other prospect of redevelopment. 43. However, for the purposes of these proceedings, I regard those matters as being entirely neutral to the council's case. 44. On merit matters, such as they might be, I have earlier noted that there was strong local resident support for the proposal on the basis of convenience and accessibility. Although those matters might be relevant on a future SEPP 1 objection if it came to arise, I have not taken them into account in these proceedings. 45. In her statement of evidence, Ms Francis also dealt with the question of inconsistency and whether the proposal was contrary to the public interest when having regard to the provisions of the future of the draft Local Environmental Plan. 46. She dealt with that on pages 16 and 17 of her statement and in that regard she concluded that, generally, on merit matters, setting aside the question of floor space ratio compliance, that it was not necessarily inconsistent. 47. However, it is appropriate for me to proceed to determine the matter on the basis that it is inconsistent with the draft Local Environmental Plan, and therefore turn to address the question of whether the draft Local Environmental Plan is either imminent or certain, the tests being in the conjunctive, and my satisfaction being required that it is both imminent and certain before I give it significant, let alone determinative, weight. 48. Mr Wilson took me to the terms of a decision of Lloyd J in Blackmore Design Group Pty Limited v North Sydney Council (2001) 118 LGERA 290, particularly pages 297 and following, where his Honour deals with the question of both savings provisions and imminence and certainty. 49. I am satisfied that, if I were to conclude that the draft LEP were imminent and certain, it should be given significant (and indeed determinative) weight in these proceedings. 50. Mr Robson SC, counsel for the applicant, suggested to me that I ought not consider that the making of the draft LEP was imminent because the processes commencing with the s 55 notification to the council and the making of the LEP still involved a number of further steps which have not been finalised and that I could not therefore accept that its making was imminent. 51. I am prepared, for the purposes of considering the second question, to consider that the making of the draft LEP might be regarded as being imminent, given the very tight timetable set by the Minister for compliance by the council and the policy imperatives that Mr Wilson took me to in the various documents – these meaning that that timetable is likely to be adhered to with minimum slippage. 52. However, I am not prepared to conclude that the making of the instrument in the terms that are put before me is certain. 53. I have reached that conclusion because I have had evidence in the documents of the departmental processes being involved in the detail of the draft LEP over a considerable period of time. 54. The genesis for the consideration of supermarket development and floor space ratio matters in the Turramurra town centre arises from, in the first instance, a report commissioned by the council from Hill PDA Consulting which was provided to the council in July 2005. 55. This report notes, in two places, relevantly, in my view, pages 41 and 46, that there are a number of matters relating to alterations and demand for alterations in retail space at a variety of centres, but with respect to Turramurra, it is noted on page 41: Note that if supermarket based centres were introduced in Pymble and Roseville, then there would be little demand to expand the supermarkets in the other neighbourhood centres, other than some minor expansion of the two existing supermarkets in Turramurra due to their small size. 56. On page 46 the report specifically notes under the heading "Turramurra": Turramurra can be allowed to have some expansion (up to around 4,000 square metres). Some of this would be in the expansion of the two existing supermarkets which are both undersized for modern supermarkets. 57. The outcomes of this report were presented to the council in a report dated 24 November 2005 and presented to the council at its meeting on 6 December 2005. On page 7 of that document, the comments of the Hill PDA report are noted at the foot of the page in the following terms: In addition to the retail expansion recommended by the retail study, provision should also be made for additional floor space to service the expected increase in dwellings within the town centres, and it notes: Some of this expansion would be in the two existing supermarkets which are both undersized for modern supermarkets. 58. I have transposed the orders of those two paragraphs for the purposes of sense in this decision. 59. At pages 11 and 12, under the heading "Traffic Options", a number of options are canvassed, which include as option (D) supermarkets at sites other than the present site, and option (E) for a continuation of the supermarket at the present site. 60. I have evidence that the council has adopted option (D) rather than option (E), but the discussion of that in the document presented to the council on 6 December 2005 I am satisfied relates to traffic matters only. 61. I now come, critically, to the matters that were reported to the council for its meeting on Monday night of this week. 62. The report that was presented to the council was prepared on 2 November. 63. On page 15 of that report, there are a number of matters set out concerning directions under s 117 of the Act. At the foot of that it is noted that there is a requirement that the business zones will not: (c) create, remove or alter provisions applying to land zoned for business that will result in a reduction of potential floor space area." 64. That is a note which is relevant to, and in my opinion, critical in, the present appeal. That is expanded upon in some detail in the centre of page 16 of that paragraph in the following terms: In relation to part (c) of the direction, it is considered that the draft LEP is compliant subject to some minor amendments. All sites in the existing business 3A(a)(2) zone have had the maximum permissible FSR increased from the current 1:1 to maximums ranging from 1.6:1 to 2.8:1. The majority of sites can develop for business uses up to the maximum FSR. The only site which has the maximum combined retail business and business FSR capped below the existing 1:1 FSR permissible under the current zoning is precinct K, not presently relevant. In order to ensure compliance with the direction it is recommended that the combined retail and business FSR be increased to permit the existing 1:1 requirement on the site. It is acknowledged that the maximum retail FSR capped at below the existing 1:1 potential. The reason for the capping of retail in these sites include ensuring that the overall future retail provision in Turramurra is consistent with council's adopted retail strategy, which will allow for an overall net increase of approximately 8,000 square metres, or 70 per cent over existing retail provision to manage traffic and parking issues, particularly in the Ray Street precinct. In any case, it is considered that a development with a 1:1 retail FSR is unlikely to in a strip retail context, as this would require first floor retail, whic h is commercially unattractive. 65. Since that report was prepared on 2 November, much of importance has taken place. 66. First, on 3 November 2006, a Ms Nillsen sent an email to relevant people at the Department and at the council setting out matters that remained in concern about the draft LEP amendment for Turramurra and matters to be discussed at a forthcoming meeting. 67. In particular, that attachment dealt with three matters of importance in the present appeal. 68. The first is the general importation of matters contained in a document entitled "The Response on Draft Ku-ring-gai LEP St Ives", and they are identified as relevant for Turramurra and the remaining centres and need to be addressed accordingly. 69. An attachment to that document notes, in particular, a reduction of the commercial retail FSR for the Coles site. 70. A further copy of the detailed St Ives letter was also in evidence and that is the document that has been imported by virtue of paragraph 1 of that attachment. 71. It says, at paragraph (n): There are a number of sites in the existing business zone 3A(a)(2) that will have reduced FSR allocation under the proposed town centre's draft Local Environmental Plan. The Department's summary requirement is recorded as being. 'The proposed decreases in the FSR in this zone are contrary to the section 65 certificate in the Minister's direction under section 55. Council is to ensure that the requirements are met.' 72. A meeting took place on 6 November involving four staff from the council and four staff from the Department. 73. The meeting included Ms Nillsen, the author of the 3 November email, and a Mr Goth, who is the relevant Regional Director for the Department, and who is the author of an email to which I will turn shortly. 74. That meeting, on the evidence given to me by Mr Wyse, a planner whose evidence was permitted in the proceedings over the objection of the applicant, had discussed the question of retail floor space ratios but had not specifically discussed the question of the floor space ratio for the Coles site; that notes had been taken by council officers of what took place at that meeting; that those notes had been consolidated; but that they had not been provided to the Department for confirmation. 75. The meeting, in his evidence, agreed to a number of outcomes. 76. On 7 November, following that meeting, Mr Goth sent an email to a number of people at the council and at the Department confirming that the meeting had taken place, and doing two things - first, noting that there were outstanding issues on the Turramurra LEP which required resolution; and second, indicating with respect to the document provided by Ms Nillsen on 3 November that it should be discarded as only being a working draft for facilitating discussion at the meeting. 77. The email then continued to say: If your councillors are already aware of the contents of this working paper, I would be happy for you to advise them that we have successfully addressed the matters outlined in the paper during our discussions and that the only issues that are of concern to the Department are those outlined in the attachment below. 78. The attachment to the email then lists matters under three headings: o matters relating to the St Ives Centre document to which I have adverted, and the summary requirement continuing to be imported that says council is to ensure that matters identified in the response on draft Ku-ring-gai Local Environmental Plan St Ives are addressed in Turramurra and the remaining centres; o there are then matters relating to referencing to maps which are not of significance in my assessment; and o then matters relating to the heights of buildings which may or may not be significant. 79. They are all, however, matters that make it clear, at least in the eyes of the Department as at 7 November, that the contents of the draft LEP were not certain. 80. The second thing is that I cannot be satisfied, on the evidence of Mr Wyse, that the matters that were dealt with at the meeting concerning floor space ratio for the Coles site were adequately or completely satisfied and resolved between the council and the Department in light of the specific written strictures with respect to the Coles site contained in the earlier correspondence, including the immediately preceding earlier correspondence to which I have referred. 81. I recorded earlier that notes were taken of the meeting. They were not produced to the Court and that they had not been provided to the Department. I draw no inference whatsoever adverse to the position of the council with respect to their non-production to the Court, and I presume, for the purposes of this decision, that Mr Wyse has accurately and appropriately summarised the terms of what those notes disclose. 82. However, the meeting did not specifically discuss the Coles site and the strictures of the Department with respect to it and the application of business FSR as earlier noted. The notes were not provided to the Department and I have no evidence (and, indeed, Mr Wyse was unaware of any evidence) of the Department adopting any written form of terms of outcome of that meeting. 83. In light of the repeated emphasis on the St Ives document matters and the criticality of any notation that the FSR issue concerning the Coles site had been resolved is absent from any evidence that I have before me, I am not prepared to conclude that the terms, in the relevant sense, of the draft LEP can be regarded as certain, nor can I be sure, given the reservations expressed by Mr Goth in his email of 7 November, that, in general terms, that which is contained in the draft LEP might be regarded as certain. 84. It would not be possible, on the basis of the degree of comfortable satisfaction which I am obliged to have on a Briginshaw v Briginshaw (1938) 60 CLR 336 basis that I could conclude that the reduction in FSR for this site would be applied. 85. I am therefore satisfied under the circumstances that I ought not give significant weight to the terms of the draft LEP in this regard and I should certainly not regard it as an inhibition to the approval of this application. 86. The orders of the Court will therefore be as follows: 1. The appeal is upheld; 2. Development Application 581 of 2006 is determined by the granting of development consent subject to conditions which remain to be finalised between the parties; and 3. The exhibits, other than exhibits A and B, will be returned at the time of making of orders in these proceedings. 87. To give effect to this decision, I give the following directions: 1. The respondent is to file and serve revised settled conditions of consent by 23 November. These are to be provided electronically in accordance with Practice Direction 2 of 2005 with a separate Court e-mail sent notifying of the making of those conditions and asking that they be drawn to my attention; 2. The matter is set down for callover on 28 November before the Registrar; 3. Liberty to re-list the matter before me on two days notice if there are any matters arising out of direction 1 that require further attention; and 4. If direction 1 is complied with and there are no outstanding matters relating to conditions, I will make orders in Chambers and vacate the call-over. Tim Moore Commissioner of the Court 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.