Land and Environment Court of New South Wales CITATION : Hotville Pty Ltd v City of Sydney Council [2008] NSWLEC 1282 This decision has been amended. Please see the end of the judgment for a list of the amendments. APPLICANT Hotville Pty Limited PARTIES : RESPONDENT City of Sydney Council FILE NUMBER(S) : 11294 of 2007 and 21293 of 2007 CORAM: Murrell C KEY ISSUES: Appeal :- Development Application and Place of Public Entertainment :- consolidation of consents and use of all levels of building for hotel/bars of places of public entertainment, opening hours, impact on residential amenity - noise and vibration, and patron behaviour LEGISLATION CITED: Environmental Planning and Assessment Act 1979 South Sydney Local Environmental Plan 1998 DATES OF HEARING: 18/03/2008 and 20/03/2008 DATE OF JUDGMENT: 25 July 2008 APPLICANT Mr C. McEwen, SC and Mr M. Staunton Instructed by Rachel Green LEGAL REPRESENTATIVES: of Spiegel & Associates Pty Ltd Mr S. Kondilios, solicitor with Ms N. Johnston of Maddocks Lawyers JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES Murrell C 25 July 2008 11294 of 2007 and Hotville Pty Ltd v City of Sydney 21293 of 2007 Council JUDGMENT 1 This judgement is for appeals under: s 97 of the Environmental Planning and Assessment Act 1979 and s 176 of Local Government Act 1993. 2 The applicant in these proceedings is seeking to consolidate and rationalise a number of consents for the subject premises known as the Burdekin Hotel located at 2-4 Oxford St, Darlinghurst. Approval is also sought for the third floor level and the basement as places of public entertainment (POPE). The opening hours are proposed to be 8 am to 2 am from Monday to Thursday inclusive and 8 am Friday continuous until twelve midnight Sunday. 3 The proposal will limit the number of people in the Lava Lounge (level 3) to 140 persons, and in the Dug Out Bar (basement) to 60 persons. Currently there is no restriction on numbers for these levels. 4 The application is to also consolidate existing approvals for the ground, level 1 and 2 into a single development consent and approval under s 68 of the Local Government Act. 5 The building is on the corner of Oxford Street and Liverpool Street being Lot 1 DP 6064 and the site is generally triangular in shape. The building is listed as a heritage item in the South Sydney Local Environmental Plan 1998 (LEP) and is a federation hotel with an inter-war art deco style overlay consisting of 4 storeys with a basement level. Because of the change in topography between Oxford Street and Liverpool Street, the basement has street access from Liverpool Street at the rear. 6 The hotel is located within an entertainment, tourist and retail area on Oxford Street, comprising of a mixture of uses such as cafes, licensed late opening premises, tourist accommodation and residential premises including apartments namely at 6-16 Oxford Street, and 8-32 Oxford Street. To the north and north-east of the site there is a mix of commercial, retail and residential tenancies. 7 The subject premises has five levels as follows: 1. The Basement level (known as 'Dug Out Bar') operates as a bar. 2. The Ground Floor (known as 'Main Bar') has a POPE approval. V01-0044/HVL/GJC/447584. 3. The First Floor (known as 'Mini Bar') has a POPE approval. D/2206/774. 4. The Second Floor (known as 'Viper Room') has a POPE approval. D/2206/774. 5. The Third Floor (known as 'Lava Lounge') operates as a bar. 8 The Licensing Court Approval of 1995 allows the whole building to trade for 24 hours, except on Sundays when trading hours are limited to midnight. However, the development consents restrict the opening hours on level 1 and level 2 from 8 am to 2am the following day Monday to Thursday and 8 a.m. Friday to midnight Sunday continuously. Level 3 has development consent for opening from 8 a.m. to 11 p.m. Monday to Saturday and 10 a.m. to 10 p.m. on Sunday. For the basement level and ground floor main bar there is no condition for the hours of operation in the development consents. 9 The statement of facts provides a history of the premises as follows: 1. In April 1989, development application U89/00101 was approved for internal refurbishment of the basement and ground floor levels as a bar, use of the first floor levels as residences, and provision of a restaurant on the third floor level. The approved hours of operation were until midnight, 7 days per week. The consent was modified, with changes including relocation of restaurant to the first floor and change of use of second floor to provide offices, staff rooms and storage facilities. 2. On 4 May 1989, approval (BA89/00413) was granted for the refurbishment of the ground, first, second and third floor levels. 3. In 1994, approval was granted for public entertainment on the ground floor level. 4. The Licensing Court granted approval for 24 hour operation in December 1995. 5. On 8 December 2003, Council granted consent for the use of the ground, first and second floor levels as a Place of Public Entertainment with base hours of operation from 8 am and 11 pm Mondays to Saturdays and 10 am to 10 pm Sundays. Consent was also granted for hours of operation from 8 am to 2 am the following day Mondays to Thursdays inclusive and from 8 am to Friday continuously until 12:00 midnight Sundays for a trial period of one year. Entertainment was to be provided in the form of recorded DJ music. 6. On 19 December 2006, approval was granted for continued use of the first and second floors as a Place of Public Entertainment; consent was also granted for noise attenuation works and internal refurbishment of the hotel. 10 The respondent identified the following two contentions: 1. Noise and Loss of Amenity The proposal does not comply with the 'Principle Objectives' of the LEP or the objectives of the Zone 3 - Business zone. (a) The proposal is contrary to Clause 7(b) 'Principal Objectives' of South Sydney Local Environmental Plan (LEP) 1998 in that the extended hours of operation and provision of live entertainment on all five levels of the hotel will result in a significant loss of amenity to residents who live in close proximity to the premises by way of noise, vibration and disturbance. It represents an intensification of use of the premises. (b) These impacts also contravene Clause 13(1)(c) of Zoning controls for Zone No.3 - The Business Zone, under South Sydney Local Environmental Plan 1998 and Part B: Urban Design Principles "Design for a Sustainable, Healthy Environment," Part D: Social Planning Criteria "Cumulative impacts and trade-offs" Part E: Environmental Design Criteria "Amenity" and "Operational controls. 2. Community Objection to the Proposal Significant community objection has been made to the application (including 43 separate letters of objection, and 7 members of the public attending at the relevant council meetings. While there are exceptions, a significant number of the concerns relate to the continuation and intensification of impacts experienced from the premises. In light of these impacts, and the likelihood of their intensification, it is contended that approval is not in the public interest. Statutory Planning Framework 11 The South Sydney Local Environmental Plan 1998 zones the subject site Zone No. 3 - Business Zone. The principle objectives of the Plan include: (a) To ensure a sustainable City of South Sydney through the efficient and equitable management and allocation of resources. (b) To enhance the quality of life and wellbeing of the local community. 12 Clause 8 of the plan requires a consideration of the goals and objectives to the extent that they relate to the proposed development. Clause 10 states that consent must not be granted unless the proposal is consistent with the objectives of the zone within which the land is located. 13 The objectives for the No. 3 business zone include: (a) to encourage suitable types of mixes of business activities including retail, commercial, professional and entertainment related land uses that increase employment opportunities and contribute towards the economic and social vitality of the area and (b) to permit appropriate forms of urban residential development within the zone, to mutually support the vitality of the commercial strips and centres in doing so, assist successfully urban consolidation (c) to improve the amenity and accessibility of commercial strips and centres for residents, workers and visitors in those areas. 14 Uses permissible in the Business 3 Zone include: amusement centres; back packers hostels; clubs; commercial premises; dwellings attached to, or within a building used or intended to be used for a land use which is permissible within the zone; hotels; multiple dwellings; recreation facility; restricted premises; serviced apartments. 15 The South Sydney Development Control Plan - Urban Design has relevant provisions for the proposed development. Section 4 is for design of a sustainable healthy environment and under environmental amenity the DCP states: - Ensure non-residential buildings are designed and specified to reduce their operational impact on adjacent residential areas. - Ensure development does not cause a public nuisance to local residents or pose risk to the locality by way of: noise pollution...and working hours. - Provide adequate separation or noise attenuation measures between land uses and activities to minimise noise transmission. 16 Part D of the DCP relates to social planning design criteria and for cumulative impacts and trade offs the objectives are: - To manage cumulative impacts arising from development activity and implement strategies to avoid or minimise these. - To identify negative social impacts of development proposals and development avoidance, minimisation or mitigation measures to address these. - To maximise the benefits of development proposals to the local community. Performance criteria - Development takes into account cumulative impacts of past development activity and does not exacerbate existing negative social impacts or issues. - Development identifies and responds to opportunities to benefit the local community and provides measures to mitigate against negative impacts. 17 For economic issues under this part the objectives are: - To maximise the economic advantages of development activity within the local area. - To ensure development makes a positive contribution to the local economy. Evidence and Submissions 18 The Court met on-site the first morning of the proceedings and heard from a number of resident objectors. Their concerns include: the loutish behaviour when patrons leave the premises and the storage of garbage bins and beer kegs in the back street leading to noise; the level of music and vibrations emanating from the premises; concern over the use of the rooftop and concern about all night trading with drug affected people rampaging down the street. 19 The residents also expressed concern about the use of the Dug Out Bar for parties and loud music and the noise that escapes from the doors that would be increased if a POPE were to be approved. The objectors also commented about the anti-social behaviour and drinking on the street and the fact that smokers from the establishment congregate on the footpath to smoke. Residents advised that people had been seen on the footpath drinking while smoking and creating excessive noise. Residents expressed concern about the base vibrations and when the doors are open the noise escapes onto Oxford Street. The residents also stated that the fire exits were blocked and used by smokers due to no facility/space allocated for smoking on the premises. The residents also considered the conditions of consent are not complied with; eg. certain bands bring in their own sound equipment which does not go through the noise limiters. Concern was also expressed about the premises being used more intensively if the current applications are approved. 20 On behalf of the applicant, Mr Stephen Cooper, a consultant acoustic engineer provided reports and gave evidence to the Court. Mr Cooper on cross examination agreed that it was possible to by-pass the sound limiters with outside sound equipment being brought onto the premises. In response the applicant agreed to a condition of consent such that outside amplifiers and speakers would be prohibited from being brought onto the premises, and that all music live or otherwise would be subject to the condition that this could not occur. Mr Cooper stated that the background plus 5 dBA does not mean that people would not be able to hear the music but that it would be controlled to a level considered to be acceptable and reasonable in his expert opinion. 21 The Council's Bundle of Documents contains advice from the NSW Police who have not objected to the proposal and it is noted the premises enjoy a low incident rate. The advice from New South Wales Police of 21 February 2007 includes: Police have reviewed the application and have no objections..... If granted the hotel would have the authority to have entertainment from 8 am Friday to midnight on Sunday which is significant. Given this we request Council to impose the conditions applicable to the following issues: + Signage Clear signage is to be displayed on each level indicating maximum number of patrons when entertainment is being conducted. + Lighting Lighting is to be at levels to allow staff to assess patrons' level of intoxication and behaviour through visual observation. Lighting is to be at levels so that CCTV cameras record quality information + CCTV It would assist the Police if Council were to ensure prior to the granting of consent that the Hotel has up to date and quality CCTV This would mean: 1. Quality cameras and system 2. coverage the following areas: (a) all entrances (b) multiple cameras at principle entrance (c) all exits (d) all stairs 3. Recordable data for 30 days minimum. 4. Capability to view footage on quality monitor in the office 5. Capability to download data and record on disc which can be played on another computer natively Windows Media Player without the need for software. + Security There is to be a minimum one licensed security guard per one hundred patrons. 22 In a further advice from NSW Police of 15 August 2007 it states our only concern at this stage is noise complaints…We would ask that suitable noise amelioration measures are adopted to minimize further complaints We would also like to advise that there be the inclusion of a comprehensive and up to date CCTV system through out the premises that is on all levels and that these cameras are operational beyond the times that entertainment is being conducted. 23 Council officers' report 26 March 2007, when commenting on whether the locality is already saturated with licensed premises stated: " The site is located within an area where entertainment uses are allowed. The premises currently hold a 24 hr liquor licence and there are no proposed changes to the existing hours of operation." As indicated in the main body of the report, the proposed POPE for basement and third floors is not considered to harm the amenity of the surrounding sensitive land uses subject to conditions. 24 It was concluded in this same report that : "It is considered that the objections received in relation to this application can be adequately addressed by the imposition of appropriate conditions. It is considered that the proposal is acceptable and is recommended for approval subject to recommended Conditions of Consent. (a) the imposition of conditions .....relating to noise attenuation and ongoing acoustic testing and mitigation measures. (b) The restriction of the hours of POPE for the basement and the third floor to be between 8 am and 11 pm Mondays to Saturdays; and 10 am to 10 pm on Sundays, and the introduction of a twelve month trial period on trading between 8 am to 2 am Mondays to Thursdays, and 8 am Friday continuously til twelve midnight Sundays. (c) The adoption and implementation of the recommendations by the NSW Police Service". 25 The matter was deferred by the Council to enable a site visit and an independent acoustic report. 26 Subsequently a further report was submitted to the Council, which noted that an independent acoustic assessment had been undertaken by Renzo Tonin and Associates who were engaged by Council to independently assess the acoustic impact from all levels from the Burdekin Hotel on surrounding residential property. This report made the following conclusions: (a) Noise emission from the Burdekin Hotel complies at all locations except at Location R3C, (the bedroom of 93/6-14 Oxford Street), where barely audible levels of low frequency base was detected between breaks in traffic along Oxford Street. (b) From a site inspection it was determined that the noise detected at Location R3C was emitted from the ground level of the Burdekin Hotel and transmitted through gaps in the doors fronting Oxford Street. We have made recommendations that a minor reduction in low frequency music noise be made to the sound system or acoustically upgrade the doorways fronting Oxford Street. (c) With respect to the sound system limiter, it is recommended that the basement level sound system be reset to maintain the noise levels recorded during the residential noise survey. (d) Confirmation that the use of the vocal amplifiers identified in the ground floor level system rack should be conserved so as not to increase the overall level of the relevant systems. Council's environmental health specialist reviewed the acoustic report and found it to be acceptable. Recommendations made by the acoustic consultants report have been included as additional conditions of consent including: + That there be no music/speakers outside; + That a Certificate of Compliance and Plan of Management be provided; + Closure of doors and windows whilst entertainment is being provided...... Conclusion Information received by Council's Compliance Unit indicate that over the past five years the number of complaints and incidents associated with the Burdekin Hotel are relatively low in comparison to similar hotels in the area. Further, the independent acoustic consultants report has recommended tighter Conditions of Consent to ensure that any ongoing entertainment within the hotel will not cause harm to surrounding residents by way of noise and vibration. The proposed use is acceptable subject to the inclusion of the additional and amended conditions. 27 An additional report was submitted to the Council and it described the application as: the use of the basement level, (Dug Out Bar), and level 3 (Lava Bar), of the Burdekin Hotel as a place of public entertainment in conjunction with ground, first and second floors. Proposed hours of operation would be from 8 am to 2 am Monday to Thursday inclusive, and 8 am Friday continuously until twelve midnight Sunday. The purpose of this application is to ensure that all levels of the hotel operate under the same hours and permitted use (place of public entertainment licence). The difference between the existing hours and permitted use and the proposal are outlined as follows: Level Existing Proposed 3rd floor (Lava Lounge) Standard Hours POPE + late trading 2nd floor (Viper Room) POPE + late trading POPE + late trading 1st floor (Mini Bar) POPE + late trading POPE + late trading Ground floor (Main Bar) POPE + Standard Hours POPE + late trading Basement (Dugout Bar) Standard Hours POPE + late trading * Late Trading 8 am to 2 am Monday to Thursday and 8 am Friday through to 12 midnight Sunday; * Standard Hours: 8 am to 11 pm Monday to Saturday and 10 am to 10 pm Sunday 28 Council resolved 19 November 2007 to refuse the application. 29 It was submitted on behalf of the applicant that this is an unusual application, and with the proposed conditions agreed to by the applicant, the application for consolidation of consents and that allowing entertainment (POPE) on the third level and basement and a trial period for extended and rationalised trading hours with the benefit of the plan of management and independent noise monitoring would not lead to a decrease of amenity for persons residing in the vicinity of the site. It was submitted that currently there was no upper limit on the number of people that can frequent the establishment, whereas the proposed application limits the number of persons known as the 'Lava Lounge' (third level) to 140 persons, and 60 persons in the Dug Out Bar. Furthermore it was submitted that the whole building has approval to trade 24 hrs except on Sunday when it is limited to midnight. 30 It was submitted on behalf of the applicant that the applications have been recommended by Council officers on three occasions and that three acoustic experts including Messrs Cooper, Tonin & Heggy have provided acoustic reports. 31 Currently the premises trade until 2 am on Wednesday, Thursday and Friday, and until 4 am on Saturday morning and 6 am on Sunday, and closed on a Monday. 32 It was further submitted on behalf of the applicant that the Council has led no planning or noise experts for Council to rely on that would warrant refusal of the application. Assessment and Findings 33 I have considered all the evidence to the court in assessing the issues identified by the respondent and set out above. The impact on the adjoining residential area must be considered carefully in the determination of these applications. 34 I have concluded that with the measures proposed including the sound limiter system and prohibiting imported sound equipment that bypasses the system together with the independent acoustic monitoring and the requirement for a complaints book that there will be suitable safeguards in place to provide for reasonable levels of residential amenity. 35 The Burdekin Hotel is located in an entertainment precinct and clearly residents who purchase or rent in close proximity of the area should expect that the very nature of the precinct means that the character of the area is vibrant and diverse. The density of residential development and mix of uses, including late night entertainment, contributes to this vibrancy and vitality. Residents of inner-city entertainment precincts should not expect to have the same level of tranquillity as other residential areas. It is true that different people have different levels of tolerance but in a location such as this it is unrealistic and unreasonable to expect the same level of amenity as other locations .On the other hand there must be controls and measures to ensure that noise disturbances do not exceed noise standards that have been established and legislated for. 36 I accept the evidence of the noise experts that compliance can be achieved with the LAB criteria. This means it should also be accepted by the residents that this does not mean noise will be inaudible and it is unrealistic and unreasonable to expect same. In my assessment I am satisfied with the imposition of conditions that the applications should be approved with a three year trial period. 37 I consider that a 3 year period is appropriate for the trial for the reason that currently levels one and two have consent to operate for the hours proposed until 19 December 2011. Furthermore with the independent noise monitoring required by the conditions of consent and the plan of management these allow for the premises to be closed until compliance can be achieved. 38 In arriving at this decision I have given significant weight to the advice from NSW Police who raised no objection to the applications subject to certain recommendations. These recommendations are included in the conditions of consent and the plan of management is to be amended accordingly. I note that the Police report states that there is a relatively low incidence rate for this establishment. 39 I am satisfied that the imposition of the noise/ acoustic conditions provide ongoing monitoring to address residents concerns about the exceedence of noise levels. It has also been agreed to by the applicant that there be independent noise monitoring on three occasions within the first 60 days of operation together with annual inspections and noise monitoring. 40 The applicant has also agreed to close the entrance from Liverpool Street to the Dugout Bar in the basement from midnight and for all access to the basement to be via Liverpool Street and the internal staircase. This should also have the desired effect of fewer numbers of people gathering on the footpath of Liverpool Street. Furthermore, an airlock door to Liverpool Street is proposed for the basement Dug Out Bar. 41 On going monitoring and reports from the acoustic consultant means that if there is unreasonable noise disturbance that the doors fronting Oxford Street may require acoustic measures. As such this approval makes provision for additional measures to be implemented if required. 42 An issue identified by the residents is the noise created from garbage bins and kegs being placed outside for the duration of the night. A condition of consent is imposed to provide for collection during the day and for receptacles to be only placed on the streets one hour before and taken in one hour after collection. 43 The applicant has also proposed an amended plan of management to address concerns identified by the residents. This includes garbage collection occurring between the hours of 7 a.m. and 8 p.m. Monday to Friday and 9 a.m. 5 p.m. weekends. 44 During the proceedings the question of a smoking area within the premises was raised. Clearly this would require a development application for an appropriate area to be allocated for smokers. The conflict arises because of the change in legislation for premises to be non-smoking. At this stage the applicant has not considered whether such a facility will be provided on site but this would assist in mitigating the concern of people congregating to smoke on the footpath and public domain areas. This problem however is not unique to this establishment and in my overall assessment is not a reason to refuse the applications before the Court. 45 Similarly all endeavours should be made by management to control patron behaviour to ensure that residential amenity is not unreasonably impacted. As such the plan of management and conditions contain appropriate provisions. However, once again residents living in entertainment precincts cannot have the same expectations of not being disturbed from time to time. The issue is to ensure that such disturbances are managed so that the extent and frequency of incidents is minimised. 46 The management must also maintain a complaints book to include details of the put of the person reporting the incident including a contact number so that management may follow up any complaints and this is to be made available to council offices or the New South Wales police for inspection upon request. The manager shall also be available at all times during trading hours to deal with any incident. In addition to the complaints book the hotel will maintain a mobile phone number for residents to contact should any person have a concern with the management and operation of the hotel or the behaviour of patrons. 47 During the proceedings the question of an appropriate starting time was discussed and having regard to the operating hours of the Exchange Hotel as a day club and the applicant advising that the premises do not open at 8 am but about 11 a.m. I have decided in order to minimise conflicts that the opening hours of the trial period be from the 11 am to 2 am Monday through to Thursday inclusive and from 11 am. on Friday continuously to midnight on Sunday. As such the plan of management is to be amended refect this. 48 The plan also includes a provision for not only the sound limiting system to be in a locked cabinet but all musicians and disk jockeys contracted by the hotel are to be made aware of the noise emission responsibilities. 49 The applicant has agreed to the surrender of the existing consents within one month if approval is granted for the trial period to be made permanent. This is considered to be an appropriate course of action if the trial becomes permanent then the consents for the premises will be rationalised and all levels of the subject premises will be subject to the same conditions and trading hours. 50 During the proceedings of the court raised the issue of the adequacy of fire evacuation and satisfaction of BCA requirements. Clearly this is a most important issue given that the premises could accommodate up to 735 people at any one time. This number is made up of 60 patrons for the basement level, 255 at ground floor and 140 on levels one and two and three of the premises. The applicant provided an expert report as to the adequacy of the building for evacuation purposes and with the conditions imposed and I am satisfied that this matter has been appropriately considered and addressed. 51 Accordingly, on the basis of my assessment above, the formal orders of the Court are: 1. The appeals in respect of the premises known as the Burdekin Hotel 2-4 Oxford Street, Darlinghurst, are upheld. 2. The applications are approved subject to the conditions contained in Annexure 'A'. 3 The exhibits are returned to the parties with the exception of 7, H and L. ___________________ J. S. Murrell Commissioner of the Court kb/ljr 28/07/2008 - Amendment to Applicants representation - Paragraph(s) coversheet 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.