Land and Environment Court of New South Wales CITATION : Cessnock City Council v. Peter Cavill Ireland and Pamela Ireland [1998] NSWLEC 87 APPLICANT Cessnock City Council PARTIES : RESPONDENT Peter Cavill Ireland and Pamela Ireland FILE NUMBER(S) : 40073 of 1998 CORAM: Sheahan J KEY ISSUES: :- LEGISLATION CITED: Environmental Planning & Assessment Act 1997 Local Government Act 1993. Warringah Shire Council v Sedevcic (1987) 63 LGRA 365 ("Sedevcic"); ACR Trading Pty Limited & Anor v Fat-sel Pty Limited & Anor (1987) 11 NSWLR 67 ("Fat-sel"); CASES CITED: Meharg v Newcastle City Council & Ors (40242 of 1998, 13 February 1998 at p 57):; Rowley v New South Wales Leather & Trading Co Pty Ltd; Woollahra Municipal Council (1980-82) 46 LGRA 250, DATES OF HEARING: 18/08/98 DATE OF JUDGMENT: 10/09/1998 APPLICANT Mr J E Robson, Barrister Mr G Garside of Cleaves Mallik Gibbs LEGAL REPRESENTATIVES: RESPONDENT Mr G Newport, Barrister Mr D Carson of Lorton Duke & Co JUDGMENT: 1. In these Class 4 proceedings the Council seeks a declaration that a partially completed building ("the subject building") on lot 1 DP 819282 ("the subject land") at Pokolbin, has been unlawfully constructed, without the consent or approval of the Council. 2. Council also seeks a declaration that the building does not comply with its relevant building approval ("BA 643"), and seeks orders that the respondents be restrained from doing any further building works upon the subject building, and that the subject building be demolished. Background 3. The respondents purchased the subject land in 1984. They "and Tascha" conduct there a winery and antique business known as "Peppers Creek" including wine tastings and the Court Yard Café. They appear to trade as "The Antique & Wine Company" and the property has a frontage to Ekerts Road at its corner with Broke Road. The map in the brochure (Exhibit R3) indicates its location close to leading wineries, guest accommodation and tourist attractions. 4. The Irelands advertise the provision of accommodation "for a few days of rest and relaxation". Exhibit R3 describes "Peppers Creek" as a "charming complex of stone buildings housing a fine quality Antique Store, a Boutique Family Winery, a delightful Courtyard Café and the `Yacht Club' accommodation". The Yacht Club is described as "a self contained 4 bedroom, 4 bathroom complex ... available for rental" and as "the ideal getaway for 3-4 couples". The photographs in the brochure (Exhibit R3) show attractive stone and timber buildings and associated structures, set within a very attractive rural environment. 5. The evidence discloses a lengthy series of dealings between the parties regarding the gradual development of the complex. (See Exhibit C1, document 1). Peter Ireland in his affidavit claims that he has always enjoyed a cordial relationship with Council officers. 6. On 28 August 1996, Council granted consent to "DA 110", and on 19 September 1996, building approval "BA 643", for two two-bedroom tourist accommodation buildings to be located in positions, described at sites 5 and 6 on a site plan of the subject land submitted with both applications (see Exhibit C1 documents 2-5 and Exhibit C5). 7. On 8 August 1997 the building proposed for site 5 had its final inspection. On 11 August 1997 an amended BA plan (see Exhibit C1 documents 6 and 8), in respect of the design of the proposed tourist accommodation, was lodged, and on 5 December 1997, during an inspection of reinforcement works, Council's Building Assessment Officer, John Francis Roseland ("Roseland"), had a conversation with Peter Ireland and advised him not to proceed with the then current building works as there was no valid building approval in existence. 8. The photographic evidence in Exhibits R5 (8 December 1997), C2 (5 January 1998), C3 (27 March 1998), C4 (1 May 1998) and R4 (June 1998) shows substantial works towards the completion of the subject building. The evidence indicates that by 1 May 1998 it had reached "lock-up" stage. 9. On 6 January 1998, Council approved "DA 130" for the construction of two antique/collectable shops at site 7 on the subject land, adjacent to the winery building (see Exhibit C1 document 7, and Exhibit C5). 10. On 15 January 1998, Council served written notice on the respondents to cease all building works. 11. On 21 January 1998, Mr Ireland wrote to the Council complaining about the Environmental Planning & Assessment Act 1979 ("EPAA") s 94 contributions required in respect of consent to DA 130. He stated that the project planned for site 7 (the two antique/collectable shops) would not proceed, but that the second two-bedroom accommodation would proceed "10 metres to the east of the location on site plan ...". A slab certificate was enclosed. 12. On 10 March 1998, Solicitors for the Council wrote to the Irelands noting that a building is being constructed contrary to the terms of approval and advising that proceedings would be taken under s 627 of the Local Government Act 1993. 13. Ireland responded on 11 March 1998: "The building to which you refer is being constructed under DA 118/696/110 & BA 643/1996. We are unaware of the breaches to which you refer in your correspondence. If you would be so kind as to notify us of the specific conditions we have breached, then we will be in a position to rectify the matter". 14. The solicitors wrote back on 12 March 1998 "The building referred to is the building currently under construction which has not been constructed in accordance with its location as determined by the Development Approval. To comply with the current Approval, it will require the total demolition and relocation to the correct site". 15. Ireland wrote back on 13 March 1998: "Council were notified of the change of location in writing on 21/1/98. As they have not responded to that correspondence we presume there to be no complication & have therefore proceeded with the project". 16. Council made no response to Ireland's letter of 13 March 1998, but another Senior Council officer Brian Raymond Clark says that he was contacted by Ireland shortly after 10 March 1998 in relation to correspondence he had received from Council's solicitors. Ireland expressed concern that he had been asked to stop work and said to Clark something to the effect of "I am concerned the Council has taken this matter to its solicitor when all I have done is moved the location of the approved building approximately 10 metres from the location on the approved plan. It was always my intention to lodge an amended plan to clarify the situation". 17. Clark examined the file and came to the conclusion that the work was not in conformity with BA 643. Clark reinforced the Council view in a telephone call to Mr Ireland that the works should cease. Ireland indicated he intended to lodge amended plans but Clark pointed out Council could not retrospectively approve the work. Council was also seeking some clarification from him in respect of DA 130, and an arrangement was made for a meeting with Council officers on 27 March 1998. 18. On 25 March 1998, a Council officer informed Ireland that the subject building did not conform with "tourist accommodation" and that the Council could not grant it retrospective approval. 19. The Class 4 proceedings were commenced on 31 March 1998 and were apparently served during continuing negotiations with Council. 20. On 22 April 1998, the respondents attempted to file amending plans in respect of the subject building. On the respondents' behalf their solicitor, in an open letter on 28 April 1998, confirmed an undertaking to stop work. The Allegations and Concessions 21. Council has inferred from these events that the Irelands have knowingly relocated the tourist accommodation building proposed for site 6 to the footprint of the proposed antique/collectable store adjacent to the winery. 22. The Council complains that what has occurred here is a blatant flouting of the requirements with which Council was entitled to expect the respondents to comply. Ireland conceded in his cross-examination that he "kept going", despite several requests not to proceed, and that he stopped work only when the proceedings were commenced. 23. The Council's case is that the subject building has been constructed, purportedly pursuant to BA 643, but not in compliance with it, and/or having other defects which are set out in paragraph 8 of Roseland's affidavit dated 22 July 1998, describing fundamentally his findings on a site inspection on 1 May 1998. 24. Much of the Council's case is conceded by the respondents. Specifically, Mr Newport on their behalf, concedes the following particulars asserted by Roseland: (a) The footprint and shape of the subject building is different to that which has been approved. (b) The internal floor plan is different to that which has been approved. (e) There is a significant variation to the south and east elevations. (f) The walls do not have provision for doors and windows, as shown in the approved plans. (g) The structure does not enable (nor is it able) to provide for a first floor as otherwise provided by the plans. (h) (iii) There is no Building Code of Australia certification in relation to the structural adequacy of the concrete. 25. In respect of some other particulars (eg (c), (d), and the remaining items in 8(h)) Mr Newport contends that compliance can be achieved before the proposed works are completed. 26. Mr Newport also concedes breaches of conditions 6 and 8 in respect of electricity supply and on-site parking. 27. The Council also complains (see Roseland paragraph 9) that there has been no notification to neighbours nor any advertisement in relation to the relocation of the building, but Mr Newport contends that there is no known demand for such advertisement or notification. 28. Accordingly, the respondents concede that, due to technical breach of BA 643, prima facie the Council is entitled to declaratory relief subject to the question of discretion. 29. In their defence, Mr Ireland contends that, although the building does not comply with document 6, nor with the footprint depicted in documents 5 and 6, the proposed tourist accommodation has been moved only 6-10m to its east within a 33 acre property. The respondents do not concede that the building has been placed exactly where the antique shop was proposed to be. It does not abut the winery, as the plans indicate that the shop would; in fact the evidence suggests it is 7.75m from the winery, and that the footprints are similar, but not identical. 30. Mr Newport submits that a 6-10m variation in a block of this size is minor, indeed de minimis, and submits that there has clearly been no environmental harm caused. 31. The respondents are said to own and build high quality buildings, and the subject building is asserted by them to be of the same quality. The buildings already on the site have been used by Council in draft DCP 28 (Exhibit R2, sketch plan in paragraph 5.1 at p 15) to illustrate the type of construction Council would like to see in this part of its area. 32. Accordingly, the respondents ask for any order for demolition to be suspended, so as to enable the necessary applications to be made to Council for whatever development and building approvals may be required and for a building certificate in respect of what has already been done. Some of the evidence in more detail 33. Ireland testifies that the subject building is 1km from the nearest residential development, 1km from Tyrrell's Vineyard complex, 1/2km from Pepper's Guest House and 1/2km from the Tellawanta Hotel. He testified that: "none of the proprietors of the above developments objected to the granting of the development consent on 28 August 1996 or the building approval on 19 September 1996. I also say that the building does not represent any environmental harm to nearby premises". 34. Although he sought to explain some events recounted in the evidence on the basis that he was an amateur who drew only rough plans and submitted them to Council, he conceded in cross-examination that he had drawn plans for others and possesses some expertise, although he has no formal surveying or other such professional qualifications. 35. Roseland has relevant qualifications and experience as a planner (Exhibit C6). In December 1997 he had conversations with Ireland regarding the change of intended use of the building and the relocation of the work. He says he advised Ireland to proceed no further with the works until the consent relating to the erection of the tourist accommodation had been amended pursuant to EPAA s 102 and an amendment also secured to the building approval. He claims that Ireland said at a meeting on 14 April 1998: "I do not build buildings for a particular stage. I build to lock-up, then decide on their use. I carried out the works on this building because I could not wait for development approval". 36. Roseland also objects to the slab certificate forwarded by Ireland as it was not given by a practising structural engineer. Roseland testified that he has abiding concerns in relations to the structural adequacy of the subject building. 37. Ireland contends that the site plans relied upon by Council were informal, having been drawn up by him personally, and included no dimensions apart from boundary measurements. He claims that his plan "does not attempt or purport to plot the existing improvements or the proposed tourist accommodation by relating the distances of the improvements from the boundaries or with each other". He claims to have lodged a further amended plan, reflecting the present building, but to have received no response. 38. Roseland points out that no application has been made by Ireland or the other respondent to surrender the building approval granted for the two shops, nor has there been an application made to change the use thereof. The necessary process to achieve Ireland's objective has not begun. 39. Ireland claims that on two previous occasions Council gave him retrospective approvals for building works. He claims that the building on site 5 has a floor area of approximately one-third in excess of that shown on the building plan. He pointed out the enlarged floor area to Council officers when they inspected the building works and indicated he would lodge amended plans to reflect the improvements as built. He claims no objection was taken to this course of action and the amended plans were approved on 8 August 1997, on the same day as the final inspection. He asserts that this particular cottage was also located approximately 70 metres west of the general location of the cottage on the site plan which accompanied the BA and that if the second cottage had been constructed in the precise position indicated on that site plan, it would have straddled the access road to the property. 40. Roseland gave substantial evidence in respect of the alleged retrospective approvals and all earlier dealings between the parties, but the Court is not satisfied that the alleged retrospective approvals have been "explained away" completely. 41. Ongoing negotiations with the Council broke down in April 1998, when the General Manager wrote to Ireland, in response to his letters of 8, 21 and 22 April, on 23 April 1998, reiterating that he had the right to seek a variation under s 102 in respect of the development approval and its conditions. The General Manager noted: "The pending action relates to building matters and while I also regret that we have now reached a stage where litigation appears to be inevitable, I don't see how a resolution can be achieved given the unauthorised building work and your decision to continue". 42. In a further affidavit Mr Ireland testifies that by the time he ceased building operations he had spent approximately $50,000 on the subject building; that the value of the improvements in their present state is estimated at $150,000; that demolition and site restoration would cost $30,000; that replacement costs for an identical development would be approximately $50,000; and that he would suffer lost earnings in the meantime from the leasing of proposed residential accommodation, estimated at $1,000 per week. The exercise of discretion 43. The principles that the Court should apply in considering the exercise of its discretion in matters such as this are collected in two judgments of Kirby P, as he then was, namely in Warringah Shire Council v Sedevcic (1987) 63 LGRA 365 ("Sedevcic") and ACR Trading Pty Limited & Anor v Fat-sel Pty Limited & Anor (1987) 11 NSWLR 67 ("Fat-sel"). 44. In Fat-sel, Kirby P said (at p82): "it is important to appreciate the wide scope and purpose of the discretion conferred by s 124 [EPAA]. Clearly, it is not a warrant to set at nought the complicated and sensitively balanced provisions of the legislation, substituting for the operation of the law laid down by Parliament, the personal opinions of the judge hearing the case. On the other hand, it would be equally erroneous to ignore the discretion or to give it an unduly restricted operation. It is just as much part of the structure and scheme of the Act, for the enforcement of planning law, as are the other parts." Kirby P goes on to refer to the collection of principles in Sedevcic and then comments that: "[the discretion conferred by s 124(1)] is a mollifying one. It permits, in appropriate cases, the refusal of injunctive relief where to grant such relief would work such an injustice as to be disproportionate to the ends secured by enforcement of the legislation including by injunction". 45. I collected some other relevant authorities in my judgment (at first instance) in Meharg v Newcastle City Council & Ors (40242 of 1998, 13 February 1998 at p 57): * In Rowley v New South Wales Leather & Trading Co Pty Ltd and Woollahra Municipal Council (1980-82) 46 LGRA 250, Cripps J said (at 261): "The discretion ... involves the weighing up of all relevant factors - not only the public interest, but also the rights and interests of the parties including matters of conduct, hardship and convenience. It is also relevant to determine the extent of the breach and whether the breach was the result of deliberate flouting of the law or ... a misunderstanding by a local authority of its obligations under the legislation. Finally the Court must decide to do what is fair and just as between the parties and in the public interest". * A somewhat similar factual situation appears to have occurred in Council of the Municipality of North Sydney v Ankarindo Pty Limited, McClelland J, 3 November 1983 ("Ankarindo"). In that case, McClelland J said that where the ingredient of a deliberate flouting of the law was missing, there was no environmental damage and no or little encroachment on the amenity of the neighbourhood "and where, moreover, the burden imposed upon the infringing developer would be of the severity proposed in this case, the Court, in the exercise of its discretion, should not grant such relief". 46. The Courts must see to the "orderly enforcement" of a "public duty" to comply with laws made by Parliament for the orderly and proper development and use of the environment - there is a public interest in upholding the law and seeing that it is obeyed. (Tynan & Ors v Meharg & Newcastle City Council (CA 40119/98) 30 September 1998, per Stein JA, at p7). 47. In this case, in contrast to Ankarindo, there is evidence of conduct that amounts to a deliberate flouting of the law. Mr Ireland is not an unsophisticated or naïve citizen. In his evidence he made damaging admissions, namely that the works were in breach of the relevant approval, and that he continued with his building works despite being told by Council not to do so because they were in breach. 48. He, therefore, must be held to have embarked upon a course of conduct which was in flagrant and continuing breach of the Act, bordering on what Counsel for Council described as "contumacy" (defined as "perverse and obstinate resistance to authority"). 49. Furthermore, the proportionality envisaged by Kirby P must be assessed as at December 1997, not at the date of the hearing - December 1997 being when the original relevant conversations occurred between Ireland and Roseland. Subsequent works done by Ireland should not be considered as a factor in determining the degree of hardship which a grant of relief might incur, because the hardship involved in having to demolish those works is self-inflicted. 50. In January 1998, the position of the Council was made abundantly clear in correspondence, and legal action was threatened. In response, on 21 January 1998, Mr Ireland admitted that the building was not in the right location. Nonetheless, work continued until at least late March, if not later. On 10 March 1998 or thereabouts, Council's solicitors and officers had confirmed the Council's position to Ireland. The proceedings were commenced on 31 March 1998, but apparently not served immediately, and Ireland admits that they alone brought about the cessation of work. 51. In my view, this amounts to more than speculative conduct - it involved the continued flouting of both the law, and the legitimate requirements of the consent authority. 52. Accordingly, I do not think that a decision to grant relief in these circumstances would work an injustice "disproportionate to the ends secured by enforcement of the legislation." The essential failings of the respondents having been conceded, Council is entitled to proper and appropriate relief, namely demolition. 53. However, the question of Ireland's deliberate flouting of the law must be viewed in the context of the Council's pattern of behaviour, which appears to have involved permitting Ireland, on previous occasions, to regularise minor breaches of other building approvals. This pattern of prior behaviour does not justify Ireland's actions, but provides a context which mitigates, to a certain extent, the seriousness of his breach. 54. In addition, although much of the expense that would be involved in demolition is self-inflicted, some of it is not, and that amount is relevantly a hardship to the respondents. Furthermore, there is no evidence that Ireland's actions have resulted in any real environmental harm. 55. For all these reasons, while the appropriate order is to grant the relief sought, namely demolition, the operation of that order should be postponed, to provide an opportunity for the parties to attempt to regularise the planning law position in relation to the building to their mutual satisfaction. 56. Mr Newport conceded on behalf of the respondents that if orders were made and suspended, it would be appropriate that the respondents should pay the applicant's costs. Orders 57. The Court, therefore, makes the following declarations, namely: 1. That the partially completed building, identified in the photograph exhibits "A2" and "A5" in the Affidavit of John Francis Roseland dated 31 March 1998 on the property known as Lot 1 Deposited Plan 819282 at Pokolbin in the State of New South Wales has been unlawfully constructed without the consent or approval of the applicant. 2. That the building referred to in declaration 1 does not comply with the Building Approval 643/1996 granted by the Applicant. and the following orders: 3. That the respondents be restrained from further works on the building referred to. 4. That the said building be demolished and removed from the property. 5. That order 4 is stayed for a period until 31 March 1999 in order to provide an opportunity for the parties to attempt to regularise the planning law position in relation to the building to their mutual satisfaction. 5. That the respondents should pay the applicant's costs as either agreed or assessed according to law. 6. That the exhibits be returned. 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.