Land and Environment Court of New South Wales CITATION : Yang v Blacktown City Council [2005] NSWLEC 282 APPLICANT Eric Yang PARTIES : RESPONDENT Blacktown City Council FILE NUMBER(S) : 11371 of 2004 CORAM: Hoffman C Appeal :- Brothel -carparking - security measures - social and economic impacts - issues raised by objectors KEY ISSUES: Blacktown Local Environmental Plan 1998 LEGISLATION CITED: Blacktown Development Control Plan 1992 Parry Properties Pty Ltd v Ashfield Municipal Council No. 2 [2001] NSWLEC 62; Venus Enterprises v Parramatta City Council, [1981] 43 LGERA 67; CASES CITED: Cartier Holdings Pty Ltd v Newcastle CC [2001] NSWLEC 70; Martyn v Hornsby SC [2004] NSWLEC 614 DATES OF HEARING: 07-08/03/20051 EX TEMPORE JUDGMENT DATE : 05/19/2005 APPLICANT Mr R Creighton, agent LEGAL REPRESENTATIVES: RESPONDENT Mr T O'Connor, solicitor SOLICITORS Houston Dearn O'Connor JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES Hoffman C 19 May 2005 11371 of 2004 Eric Yang v Blacktown City Council JUDGMENT 1 This is a class 1 appeal, No. 11371 of 2004 between Eric Yang and Blacktown Council in regard to refusal of a brothel in industrial unit Nos. 11 and 12 in an existing development at No. 12 Forge Street, Blacktown. 2 The applicant sought opening hours of seven days a week, 24 hours a day. The area is zoned 4(A) Industrial under the Blacktown Local Environmental Plan 1998. The use for a brothel is permissible with consent of the responsible authority. Part E of the Blacktown Development Control Plan 1992 stated controls on brothels in the industrial zone in Ch 6, Pt E. The Local Environmental Plan contains statutory provisions in cl 43(A). 3 The brothel occupies industrial units having direct street frontage with an entry door immediately beside a take-away food shop that services the industrial area. Outside the shop are some tables and chairs used by shop patrons whilst consuming food. 4 Just inside the front boundary through the drive entry gates to the shared carpark there are two roller doors to garages one in each of the brothel units. At the time of the on-site hearing one was fitted out as a CCTV security camera office, with TV screens, telephones, files and office furniture. The other roller door and garage was used for storage. 5 The two industrial bays had been joined by the opening of doorways through the fire separation walls. The customer service rooms had showers installed by breaking up the concrete slabs to lay pipes. There was cracking of the concrete masonry walls in places, both inside and outside. Air conditioning units have been installed on the roof and external flood lights installed in various places. 6 The secretary of the Owners Corporation of Strata Plan No. SP70989, the Industrial Bay Development of which the brothel was part, gave uncontested evidence that these works had been done without consent of the body corporate. The council indicated there was no council consents either. 7 At the rear of the brothel units was a shared carpark. Most individual car spaces were allocated to individual industrial bays, and there were some visitor spaces that were part of the common property. The subject proposal had the two closest carparks beside the building allocated to it. The next carpark was allocated to the shop. The remaining carparks were allocated one each to the other industrial bays with six visitor spaces furthest away from the brothel at the rear of the site. Car spaces in the carpark as shown on the Strata Plan, totalled 20. 8 The brothel proposed a reception room, five customer service rooms, called working rooms, two waiting rooms, a kitchen, a laundry and toilets, with the two garages to be returned to that use. During the view it was noted one of the corridors to one set of toilets was gated to create a kennel in which there was an Alsatian dog. 9 Also a staircase was discovered in a cupboard leading to the roof space. The ground floor rooms all had false ceilings and the roof space had a floor and skylights. There were clothes lines strung in part of the space and in the other was an area with separate walls and its own ceiling, but the ceiling was low such that a person of ordinary height had to bend down considerably to enter. It had been painted with bright colours, and had its own air conditioning. 10 These in-roof areas were not shown on the subject plans, and had not been authorised by the body corporate. 11 The issues were: 1. Whether the proposed development makes adequate provision for carparking (proposal requires nine spaces and effectively only two available). 2. Whether the proposed development is satisfactory with regard to the provision of security measures. 3. Whether the location is suitable for the proposed development with regard to issues of safety and security raised by the New South Wales Police and social impacts 4. Whether the proposed development complies with the draft Local Environmental Plan exhibited for brothels. Particulars Amendment No. 199 to the Blacktown Local Environmental Plan aims to incorporate a distance of separation requirement to schools of 500 m. The proposed development is within 500 m to the Blacktown North Public School. The issues also queried whether the brothel was within the minimum distance separation of another brothel required under the amendment. 5. Adverse social impacts in the locality. 6. Issues raised by objectors. 12 The hearing was attended for the respondent by: - Mr T 0'Connor, solicitor of Houston Dearn O'Connor, - Mr G Apps, senior statutory planner for the council and - Ms R Saltman, consultant social planner. 13 Also there were perhaps 20 or 25 objectors on site, and some gave oral evidence in addition to a number of written objections and petitions in Exhibit 10. 14 The oral evidence was heard from: - Mr S Faddoul of 16 Lavinia Street, Seven Hills, objector and owner of the shop, - Ms P J Cook objector and part owner of unit 7 at No. 12 Forge Street, - Mr M Dall'Acqua, objector and owner of unit 4 at No. 12 Forge Street, - Ms S Leclaire, objector and employee at unit 4 of No. 12 Forge Street, - Mr P Faull, objector and part owner of unit 11 at No. 12 Forge Street. He was also secretary of the Strata Plan Owners Corporation, and gave evidence on its behalf. - Ms K A Price, objector and former proprietor of the shop in unit 14 at No. 12 Forge Street. 15 Acting for the applicant was: - Mr R Creighton, town planner and agent, and - Mr A Rowan, Consultant Town Planner. 16 The evidence was that the brothel had operated several times since 2003 until council closed it down on each occasion. Mr Faull said at the time he bought his industrial unit, Mr Yang was doing construction work. 17 It was only when Mr Faull moved in he was told about the brothel. He had observed brothel customers coming and going, and on several occasions brothel customers had come to Mr Faull's unit and asked for the brothel. He used the shop beside the brothel for morning tea and lunch. In his business he was in and out of the premises and observed the brothel operation. Red lights were turned on outside the brothel at night on special occasions. 18 Mr Faull had to work late at night on occasions or call in to collect equipment for his electrical contracting and supplies. He was concerned for personal and property security at these hours, when the industrial estate was relatively deserted, but the gates to the carpark at No. 12 were left open for brothel patrons to use. Once inside the deserted carpark at night brothel patrons and others were unsupervised. Decisions by the Owners Corporation to lock the gates at night, but give each operator a key had resulted in the padlocks to the gates being smashed and the gates re-opened. Remonstrations with the persons at the brothel had resulted in threats and having the police called. 19 Mr Faull's young teenage boys work part-time at his business, and also use it to practice their musical band at night. He had to stop that activity due to concerns for their safety. His wife also worked in the business and used to regularly do book work until about 8 pm. She had ceased that practice due to concerns for safety at night. 20 In his role as secretary of the Owners Corporation he advised the public liability insurance had been increased dramatically due to the presence of the brothel. Insurance documents were available for inspection. The brothel had already been firebombed by persons unknown. The insurance company had advised, if the brothel was approved, the Strata Plan insurance would be cancelled. Self-insurance, or off-shore, very expensive insurance, would then cost all the owners even more money than at present. 21 The Owners Corporation currently had a number of issues with Mr Yang over his unapproved construction, referred to previously, one of which was the installation of roof top air conditioners. The installation had damaged the roof and caused rain damage inside the take-away food shop. 22 Mr Yang had only two carparks in the common property, and the proposal intended to stack park two more behind them to provide for the parking demand of the brothel. The two stacked cars would be on common property and the Owners Corporation had not, and would not, consent to that use, Mr Faull advised. The common property in the carpark was there for manoeuvring of cars and trucks and could not be used for extra carparking. 23 The use of the garages in the brothel is a potential hazard in Mr Faull's opinion, as both have narrow openings, coming directly into the main entry drive, very close to the main gates. Drivers reversing out of the brothel garages cannot see approaching cars, and those drivers approaching do not expect a car to suddenly emerge from the building. 24 The Owners Corporation was very concerned about the social and economic impact on many of the other units. The car repairer often had families who brought the car in for repair and waited, often using the tables outside the shop, so children could play as they waited. 25 Staff in many units were offended by inquiries from strangers about where to find the girls. 26 Mr Faull had observed up to seven staff of the brothel plus customers. Parking for them would impact on the available parking for other unit owners, and their customers. He had observed brothel patrons cruising the carpark looking in the wrong units, trying to find the correct one for the brothel. 27 The income of some of the units had declined because patrons would not come any more to the development. The existence of the brothel had become known in the locality. Girls from the brothel had made direct approaches to persons outside the building to come into the brothel. 28 Ms Price had been proprietor of the take-away food shop at No. 12. She had recently sold out due to falling income from the shop, that she attributed to the brothel. The nearest competitive shop was half a kilometre away. Her opening hours were 5.30 am to 2 pm Monday to Friday whilst the other shops were 7.30 am to 4 pm. 29 Mr Yang had approached her to lease her car spaces during night hours, and told her his massage parlour would not clash with her operating hours. She declined his request when she found the operation was a brothel, 24 hours a day, seven days a week. 30 She had observed customers going to and from the brothel. People came and went through the door only 1 m from her own counter. Her own customers often queued in the same area at peak times. She had witnessed girls from the brothel approach men in the queue. Some casual customers of the shop made lewd comments to Ms Price and her staff. 31 Her income at the shop had declined. Many of her casual customers had been women, bringing cars for repairs, or for pink slips for registration, and waiting while the work was done. Often they had children and used the tables and chairs outside the shop, very close to the brothel door. 32 Many women from the various businesses nearby were regular customers of the shop. During school holidays many business owners brought their children to work and they played in the area and came to the shop. So great a number of customers had stopped coming to the shop when the brothel was operating that Ms Price had to let one employee go. However the shop income continued to decline and she had to sell out. 33 The new tenant of the shop had opened only just before this hearing, and he had not lodged an objection, and his only comment when asked by the respondent, was that he would have to wait and see. 34 Ms Leclaire was an employee at unit 4 in No. 12 Forge Street. She was seventeen and had worked there for two years as a secretary and clerical assistant, as well as occasionally working on cars. One of her duties is to get the lunches and snacks for the other staff. She hated going to the shop now, she said. Male persons looked at her, being in the vicinity of the brothel, and made her uncomfortable. 35 She used to enjoy lunch at the tables outside the shop, her women friends would often come for lunch. However, the men going to the brothel had made them so uncomfortable that this was no longer her practice. Once the brothel commenced operation Ms Leclaire drove 10 minutes to another shop to have lunch away from the premises. 36 There was a surveillance camera of the brothel at the rear of the building almost opposite her employer's industrial bay. She often felt the camera was pointed to look at the bay, so that she had to keep to the rear of the bay in order to be out of view. 37 Another reason to be at the rear of the bay was that customers of the brothel often cruised the carpark looking for the brothel, and used the back door from the carpark into the brothel just opposite where Ms Leclaire worked. She did not want to be seen. 38 The conditions of her employment often required her to work back. Regularly, it was 7.30 or 8 pm and occasionally to 11 pm, depending on the workload. Normally there were other staff working too, but occasionally not. In the past she would have worked alone until finished, but now she would not stay there alone. 39 Mrs Cook was part owner of unit 7 at No. 12 Forge Street. The unit had been purchased in May 2004 as an investment. She was concerned about the potential loss of public liability insurance, as it would inhibit getting a tenant. In preparing the premises for rent she had used Ms Price's shop. She would not do that if the brothel was operating. She had seen the shop on site as a potential benefit to a potential tenant of her own premises. With a brothel there, it was a negative. 40 Mr Dall'Acqua was the owner and proprietor of unit 4, at No. 12, from which he ran a mechanical engineering business, specialising in motor sport. He was located almost opposite the rear door of the brothel across carpark about 10 m away. 41 He had observed a steady stream of brothel customers. Some of whom, not being sure of which industrial unit was the brothel, the persons would come and ask his staff. All his staff, especially his female staff, found this embarrassing. 42 He had observed the brothel operating all day from 7.30 am when he arrived at work, until 6 pm when he left. He had observed the unapproved work being done on the brothel, and the garages in the brothel being used other than for carparking, thereby increasing pressure on the open car spaces in the common property. 43 He had witnessed a police raid on the brothel and the women from it running out the back door into the carpark, and later returning via the same door. 44 His insurance premium via the Body Corporate had increased by 66%, as a result of the brothel's presence. The insurance company had stated this in documents held by the Body Corporate. 45 He was concerned his employee, Ms Leclaire, wanted to resign after being approached by a brothel customer who asked if she worked there. 46 The existence of the brothel had become known locally and this had affected his business because it catered to motor sport that involved fathers, mothers and children. It had been common for them all to come to look at each others cars, as well as the work being done on their own car, especially at weekends and in the evenings. That activity had declined, along with return business from even loyal customers, and new customers often did not return. He attributed this to the brothel and claimed his turnover had declined by 25%. 47 Mr Faddoul owned the take-away food shop, he leased it out. He, like the other owners, was very concerned about already increased public liability insurance premiums due to the brothel, and the potential to lose insurance altogether. He had complained in writing to the council about concerns for the safety and welfare of his tenants and their customers, and about rude and aggressive behaviour by the clientele of the brothel. He was concerned about the effect on the shop turnover, and that directly affected the value of the property as a business investment. 48 Ms Saltman in her evidence on social impact had said her survey of nearby businesses showed most employees were adults, and visits by minors to the locality were limited and occasional. The closest place where children go was the Blacktown North Public School about 400 m away. Residential areas were in different directions from the school than was the subject site. She had not made observations, but had the opinion that children were unlikely to pass the brothel going to and from the school. She thought the location was suitable for the brothel. 49 In terms of adverse social impacts, cl 42(A)(2)(d) of the Local Environmental Plan sought to minimise risk to employees and clients of the brothel, and to the wider community. She had seen no management plan for the brothel at the time of writing her report, but assumed that WorkCover Health and Safety Guide for Brothels, would be implemented for staff and clients of the brothel. 50 She thought the social impacts of the brothel were localised only and felt they could be addressed by: (a) the management plan, ensuring staff of the brothel ceased former anti-social behaviour, and requiring acceptable behaviour of clients. (b) avoiding the confusion of clients about which building was the brothel by clearly identifying it on a directory board and by numbers on the building. (c) using only the carpark door between 6 am and 2 pm weekdays to avoid mixing of shop customers and brothel clientele and erecting a screen beside the street entry door to divide shop customers from brothel clientele. (d) if the carpark is to be used at night by the brothel, they should employ a security guard from 5 pm to 6 am and have the gates locked, with the guard or the receptionist opening the gates on request. 51 Ms Saltman did not think the wider community would be affected by the brothel, since shopping centres and residential areas containing sensitive uses were beyond the industrial estate. 52 In examination-in-chief by the respondent she agreed she had not seen the brothel in operation. In fact the manager had denied her entry to the premises and locked it up. She agreed on the day of the hearing she had seen medical and sharps waste stored on the floor of the laundry in an ordinary plastic garbage bag. She said that was not appropriate health and safety procedure. She had also heard witnesses state on site they had discovered the medical and sharps waste in their own garbage bins. That was not appropriate health and safety either. Sharps had to be separately stored in hardened containers and medical waste had to be in sealed containers, and picked up by licensed medical waste disposal contractors. 53 She agreed in writing her report, and concluding that she could see no social impact, she was looking for a social group that might be impacted by the proposal, rather than individuals. In hearing the witnesses say women and children did frequent the area, and were offended by the presence of the brothel and its operation, Ms Saltman said she did not know previously of that, and she herself would not be offended by the presence of the brothel if she was a customer of the nearby businesses. She agreed in hearing the evidence, there were quite a number of women and children who came to the other nearby premises as customers or employees, and who used, or used to use, the shop, and who were offended by the presence and operation of the brothel. 54 Ms Saltman was asked if that offence resulting in persons not being able to use the shop was a social disbenefit. She said there was another shop on the corner of Bessemer and Chicago Streets, in the industrial estate. But she agreed Ms Leclaire's experience had shown there was social disbenefit to her, and there was social impact on other individuals, but Ms Saltman said it was very localised. 55 Overall the location and operation of the brothel subject to the plan of management would be satisfactory in her opinion. She said adults had cognitive skills to realise the brothel was there, and should not be offended. Children would probably not realise it was there. By closing the brothel between 6 am and 2 pm when the shop was open, the impact should not occur on those who might have been impacted. 56 During the hearing the parties went to see two other brothels, one in the same industrial estate that had a direct and relatively isolated entry off the street, and another in a nearby industrial estate that was in an industrial bay of a large set of industrial bays on two sides of a central carpark. Ms Saltman felt that both those brothels were quite well located too, being in an industrial estate where none of the sensitive uses existed as nominated in council's Development Control Plan and Local Environmental Plan. In reply Ms Saltman agreed the other two brothels did not have a shop and tables and chairs right outside the brothel door, as in the subject proposal. 57 Mr Apps said the unacceptable handling of medical waste seen during the hearing demonstrated very poor management of the brothel. 58 Mr Rowan said it was a matter of education of the management upon the terms of the management plan. Mr Rowan said that the hidden stair and roof space facilities could only be used for storage. The ceiling height was too low for a habitable room. Being air conditioned made no difference he said. But he had not asked Mr Yang what it was used for. Mr Yang was not called to give evidence, although he attended the hearing. 59 Mr Apps said there were no development consents nor building certificates for the brothel, even though it had been rebuilt after the fire. He did not know if a building certificate would be issued. He said the washing seen hung to dry in the roof space meant it was part of the operation of the brothel and should have been shown on the plans. He did not know if the stairs and the structures in the roof would comply with Occupational Health and Safety requirements. The stairs were very steep and narrow. 60 Mr Rowan said the council could have taken out an injunction to stop the brothel operating if it was concerned about those matters, but the council had not done so. Mr Rowan was aware that one of the other industrial unit owners of No. 12, had taken his young grandson to work on a weekend and allowed the boy to play in the vacant carpark, only to find him in conversation with one of the prostitutes. Mr Rowan said it was not illegal for a child to talk to a prostitute, and the grandfather had a responsibility to supervise the child. 61 It was put to Mr Rowan the operation of the brothel seen on site was different to the plans. For example, the plans show the garages as garages, but they are currently used as brothel facilities. The reception room on the plans currently operated as a bedroom. The facilities in the roof and the dog kennel in the corridor were not shown at all. 62 Mr Rowan said, if approved, the brothel would operate as shown in the drawings, and in accordance with the Management Plan and any conditions. It was put to him the applicant had not sought to change the hours of operation from 24 hours a day to those suggested in the evidence of being closed between 6 am and 2 pm Monday to Friday. Mr Rowan said there was no need for that, the Court could impose the conditions if required. 63 The applicant noted in submissions that Mr Faull was an unsuccessful bidder for the electrical fitout of the brothel, and also that the police had not been called to give evidence because all of their requirements had been included in the plan of management. 64 Mr Rowan was asked, what if the new shop tenant changed operating hours. Mr Rowan said the new tenant was aware of the brothel and knew the situation. If the shop opening hours were changed, the shop tenant must be aware of the implications. 65 In regard to parking the council and Mr Apps conceded that although the brothel would generate a need for eleven spaces under cl 6.6.3 of the Development Control Plan 1992 Pt E, he was prepared to accept nine spaces as sufficient if the operating hours were from 2 pm to 6 am, as the busiest time in the industrial estate would then be avoided. 66 In the afternoon and night three customers could park in the street, but Mr Apps said that left six spaces to be provided on site, and the brothel could only provide four. The other two were proposed on common property and the Court had evidence that its use for parking was denied by the Owners Corporation because the space was needed for car and truck manoeuvring to the other industrial bays. 67 The original consent for the industrial unit development had shown 28 car spaces on site, but the council had approved subsequently the Strata Plan with 20 spaces. They were the only on site carparking allowable. 68 The respondent submitted in Perry Properties Pty Limited v Ashfield Municipal Council, No. 2, [2001] NSWLEC 62, Bignold J held in par 60 to 63 also quoting Cripps J in Venus Enterprises v Parramatta City Council, [1981] 43 LGERA 67, that causing offence to a significantly large part of the community can give rise to a refusal on planning grounds. And the respondent also submitted in Cartier Holdings Pty Limited v Newcastle City Council [2001] NSWLEC 70, Pearlman J, p 416, par 34, that economic impacts can be taken into account. Further in Martyn v Hornsby Shire Council [2004] NSWLEC 614, pars 18, 19 and 20, that brothels should be located where they are least likely to offend, including that access should be discreet. 69 Ms Saltman in looking at the social impacts, looked at the wider concept of an industrial area being a likely place that a brothel will have minimum impacts. In the Court's opinion the wider concept may be true, but each site has its own particular merits, and she did not give sufficient attention to the important localised impacts. 70 In coming to a conclusion on this appeal I have in mind the three impacts of determinative weight under Blacktown Local Environmental Plan 1988, cl 42(A)(1)(c) and (2)(b). First, the evidence is clear the brothel has given rise to offence to a considerable number of adjoining and adjacent business owners, their employees, their customers, and concern for minors either unaccompanied or accompanying adults. 71 Second, for their businesses to continue, non-deterrence of the customers is of vital importance to the adjoining and nearby business owners. 72 Whilst some of the offence caused may be due to moral reasons that need to be detached from consideration in matters of this kind, a significant part of the offence is related to the adverse impact the operation of a brothel has had on the amenity of the locality and the economic reduction of business turnover and increased insurance costs for neighbours. 73 Thirdly, the location of the brothel street entry directly beside the existing shop and its customer tables and chairs, and the carpark entry door, causing brothel clientele to interact with other owners and employees and customers in the industrial development on the same Strata Plan, renders its accesses very prominent and likely to cause offence. 74 I am not convinced that the hours of operation and plan of management can ameliorate any of these three impacts to acceptable levels. 75 Therefore the orders of the Court are: 1. The appeal is dismissed. 2. The exhibits are returned to the parties except Exhibits 3, 4, 5, 6, 7, 8, 9, 13, B, C, D and E. __________________ K G Hoffman Commissioner of the Court rjs 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.