> Land and Environment Court of New South Wales CITATION : Fairfield City Council v Zhu and Others [2003] NSWLEC 235 APPLICANT Fairfield City Council FIRST RESPONDENT James Zhu PARTIES : SECOND RESPONDENT Pei Nan Hu THIRD RESPONDENT Joe Falzon FOURTH RESPONDENT Pauline Falzon FILE NUMBER(S) : 40524 of 2003 CORAM: Talbot J KEY ISSUES: Injunctions and Declarations :- prohibited development - orders against operator of business and owners of land LEGISLATION CITED: Fairfield Local Environmental Plan 1994 CASES CITED: DATES OF HEARING: 18/09/2003 EX TEMPORE JUDGMENT DATE : 09/18/2003 APPLICANT Mr A J J Thomson (Barrister) SOLICITORS Kencalo & Ritchie FIRST RESPONDENT In Person LEGAL REPRESENTATIVES: SECOND RESPONDENT NA THIRD RESPONDENT In Person FOURTH RESPONDENT In Person JUDGMENT: IN THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES 40524 of 2003 Talbot J 18 September 2003 Fairfield City Council Applicant v James Zhu First Respondent Pei Nan Hu Second Respondent Joe Falzon Third Respondent Pauline Falzon Fourth Respondent Judgment Introduction 1 HIS HONOUR: Fairfield City Council ("the council") is seeking orders and a declaration that the premises known as 610 The Horsley Drive, Smithfield ("the premises") are being used either for the purposes of a brothel and/or a business and that the use of the premises for either of those purposes is, in effect, illegal pursuant to the provisions of the Fairfield Local Environmental Plan 1994 ("the LEP"). 2 The Court has been shown evidence that the premises are situated within zone 2(a1) Residential A1. The uses that are prohibited in that zone are, inter alia, business premises, brothels and medical centres along with a whole series of other uses most of which are defined in the dictionary to the LEP. In the LEP dictionary a brothel is defined as follows:- A building or place used or designed to be used by one or more persons for the purposes of prostitution, a swingers club, a sex on premises venue or for any similar purpose. 3 Prostitution is relevantly defined as follows:- The offering by a person of his or her body to a person of the same or different sex for sexual gratification in return for payment and includes sexual intercourse as defined in the Crimes Act and masturbation committed by one person on another for payment. 4 Business premises are defined as follows:- A building or place used for the purposes of administrative, clerical, technical, professional or similar activities or in which there is carried on an occupation or profession that does not include a building or place elsewhere defined in this plan. 5 The use of premises for the purposes of a massage parlour, which the operator of the business, James Zhu, has referred to, is not, as far as I can see, separately defined. The owners of the property, Joe and Pauline Falzon, have referred to a proposed use for physiotherapy as they understood it to be originally. Physiotherapy is not defined in the LEP. Arguably, it falls within the definition of a medical centre which is as follows:- A building or place used for the purpose of providing professional health services including preventative care, diagnosis, medical surgery, treatment or counselling to outpatients only. 6 In any event, even if it was physiotherapy, the fact that Mr and Mrs Falzon agreed to that use does not assist their case. It would fall within the description of a professional health service to outpatients and as such within the definition of a medical centre, which is also a prohibited use within the zone. 7 The evidence of the council officers, which is not disputed by either Mr Zhu or Mr and Mrs Falzon, is that the premises are being used for a business. Mr Zhu does not accept, as I understand his submission, that the premises are being used for the purposes of a brothel. He has made a statement from the bar table and he has had the opportunity to ask questions of the council officer, Kenneth Collins. I understand from his statements and his questions, that if indeed sex has occurred on the premises between a customer, and there is evidence of that on at least one occasion, then it is first of all something that he has not approved of, secondly, there is signage within the premises which says "no sex" and thirdly, he appears to be submitting that from the outset the council formed a pre-disposition towards assuming that sex would be offered on the premises, notwithstanding that at the time when the first inspection took place in October 2002 there was no facility, certainly not in a major way, for the participation in sexual activities, there being only a small massage table. 8 The photos that have been presented to the Court show that the sign in relation to "no sex" was still there at the time a further inspection was undertaken on 12 September 2003. Also there appears to be several rooms which are set up with a bed and other furniture which would lend themselves to sexual activity. There is no direct evidence of sexual activity except on the one occasion when a licensed private inquiry agent visited the premises on 26 November 2002. 9 The Court also has evidence of advertising material which again is not specific about the availability of sexual activities as contemplated by the definition of prostitution but there is certainly reference to body massage and the like as being available from the subject premises. 10 The council has obtained a copy of a residential tenancy agreement made between Mr and Mrs Falzon, the third and fourth respondents, and Mr Zhu, the first respondent. That document on its face appears to be a lease of the premises for the purposes of a dwelling. However, Mr and Mrs Falzon, as I said earlier, have indicated that their understanding was, and again this is an indication from the bar table and I accept it as such, that it was indicated to them that the premises would be used for the purposes of a business as a physiotherapy centre. 11 I have also been provided with some documents the implication of which I do not fully understand. They indicate, however, that there is a dispute current in the Consumer Trade and Tenancy Tribunal between Mr and Mrs Falzon and Mr Zhu which, if I correctly understand the submissions made to me, have been deferred for the time being pending the outcome of the proceedings of this Court. 12 The applicant's claim is resolved in a simple fashion when one has regard to the provisions of the LEP. There appears to be no dispute that there is a business, of whatever kind, being conducted on the premises. The conduct of such a business is illegal. The Court is also satisfied that sexual activity by way of sexual intercourse was made available to a witness in November 2002. The Court is further satisfied that the business continues to be advertised as offering services that by implication might lead to sexual activity although not expressly referring to that prospect. I am satisfied in the circumstances, and Mr Zhu specifically accepts the position, that if I find that the use of the premises for a business is illegal then he recognises that it must cease, as also do Mr and Mrs Falzon. 13 The Court finds that the premises were used for the purposes of offering and in fact engaging in sexual services on 26 November 2002 at least. The Court also finds that the premises are being used as business premises contrary to the provisions of the LEP. I recognise that Mr Zhu did make an application for a development consent to use the premises. That development application was refused. The Court is satisfied that even if the application was capable of being approved on the merits from a town planning point of view nevertheless as it involved a business activity that falls within the definition of business premises then it is prohibited and accordingly not capable of attracting a consent. There is some suggestion that the activities may fall within the definition of a home business but the Court has not been given the benefit of any evidence to support that contention and accordingly it is disregarded. 14 In summary therefore, the council has proved that the premises have been used for the purposes of a brothel at least on one occasion and furthermore that it has been continuously used during the period in question for the purposes of a business in contravention of the LEP. Accordingly, I propose to make the declaration which is set out in [1] of the class 4 application, namely that the first respondent is using the premises for the purpose of a brothel and business in contravention of the LEP. I make order two. I do not make order three as the second respondent has not appeared and I do not make order four for the same reason. 15 I do make order five as Mr and Mrs Falzon readily accept that they were cognisant of the fact that there was an intention to use the premises for the purpose of a business. In fairness to them they did ask that the consent be produced to them somewhere along the way. That never happened. However, they as the landlords do have a responsibility to see that the premises are not used for the purpose of a business. 16 Accordingly, to facilitate what might occur in the Tenancy Tribunal tomorrow or at any other time I propose to make orders five, six, seven and eight against the - eight should be fourth, should it not Mr Thompson? 17 THOMPSON: Yes your Honour. 18 HIS HONOUR: I amend the application class 4 in [8] to refer to the fourth respondent. Those orders will be made and it is clear that in the circumstances the Court should exercise its discretion in relation to costs on the basis that the respondents have been entirely unsuccessful and there are no special circumstances that would justify the making of a special costs order. I order them to be each jointly and severally responsible, that is first, third and fourth respondent, jointly and severally responsible for payment of the council's costs. 19 Mr Zhu and Mr and Mrs Falzon, the outcome of all of that is that I am satisfied that the use of the premises for a business is illegal. Accordingly, therefore, I have made a finding that the use of the premises for a business, including a brothel and a massage parlour, is illegal. I therefore order that use to stop. I order that you Mr Zhu stop doing it and you Mr and Mrs Falzon stop allowing it to happen. So that is the position. You cannot get a consent for it Mr Zhu, it is just not available. The green book says it is illegal so that is an end to the matter. So I have made those formal orders and they will be sent to you in due course. The exhibits may be returned. 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