Reported Decision : 145 LGERA 340 New South Wales Court of Appeal CITATION: Pepperwood Ridge Pty Ltd v Newcastle City Council [2006] NSWCA 122 HEARING DATE(S): Wednesday 17 May 2006 JUDGMENT DATE: 14 June 2006 JUDGMENT OF: Giles JA at 1; Tobias JA at 2; McColl JA at 45 DECISION: (a) Appeal allowed; (b) Set aside Order 1 made by Pain J on 29 July 2005; (c) Declare that the land known as 164-168 Lake Road, Elmore Vale is land to which the State Environmental Planning Policy (Seniors Living) 2004 applies; (d) The respondent to pay the appellant's costs of the proceedings to date in the Land and Environment Court and of the appeal CATCHWORDS: ENVIRONMENTAL PLANNING – local environment plan – zoning – purpose of zone objectives – application of the State Environmental Planning Policy (Seniors Living) 2004 – identification of land by description – identification of land for purposes of the State Environmental Planning Policy (Seniors Living) 2004 - WORDS AND PHRASES – "identification" – "description" Newcastle Local Environmental Plan 2003 LEGISLATION CITED: State Environmental Planning Policy (Seniors Living) 2004 Warringah Local Environmental Plan 1985 CASES CITED: Warringah Shire Council v Punnett & Associates Pty Limited (2001) 122 LGERA 1 Druitts Developments Pty Ltd v Gosford City Council (2001) 113 LGERA 61 PARTIES: Pepperwood Ridge Pty Limited Newcastle City Council FILE NUMBER(S): CA 40666/05 COUNSEL: A: J A Ayling SC/ T G Howards R: Malcolm CRaig QC / J Maston SOLICITORS: A: Cleaves Mallik Gibbs, Cessnock R: Sparke Helmore, Newcastle LOWER COURT JURISDICTION: Land & Environment Court LOWER COURT FILE NUMBER(S): LEC 40027/05 LOWER COURT JUDICIAL OFFICER: Pain J LOWER COURT DATE OF DECISION: 29/07/2005 LOWER COURT MEDIUM NEUTRAL CITATION: Pepperwood Ridge Pty Limited v Newcastle City Council [2005] NSWLEC 257 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40666/05 LEC 40027/05 GILES JA TOBIAS JA McCOLL JA Wednesday 14 June 2006 PEPPERWOOD RIDGE PTY LIMITED V NEWCASTLE CITY COUNCIL Facts The appellant owned certain land (the land) that was zoned 7(c) Environmental Investigation Zone (the zone) under a local environment plan (LEP) (the Newcastle Local Environmental Plan 2003). The objectives of the zone were set out in the following terms: (a) To provide for the development of land for purposes which will not, or will be unlikely to, prejudice its possible future development for urban purposes or its environmental conservation. (b) To conserve the rural or bushland character, and the biodiversity values or other conservation values, of the land. The respondent argued that the appellant was prevented from developing aged care facilities on the land under the State Environmental Planning Policy (Seniors Living) 2004 (the Policy). Clause 4 of the Policy relevantly provided that: (1) This Policy applies to land within New South Wales: (a) that is zoned primarily for urban purposes or that adjoins land zoned primarily for urban purposes … (2) This Policy does not apply to: (a) land described in Schedule 1 (Environmentally sensitive land) Schedule 1 of the Policy relevantly defines "environmentally sensitive land" as: Land identified in another environmental planning instrument by any of the following descriptions or by like descriptions or by descriptions that incorporate any of the following words or expressions: … (b) conservation (but not land identified as a heritage conservation area in another environmental planning instrument), … (d) environment protection The appellant argued that the Policy did apply to the land because the relevant zone objectives did not identify the land by the descriptions "conservation" or "environment protection" or any like description. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40666/05 LEC 40027/05 GILES JA TOBIAS JA McCOLL JA Wednesday 14 June 2006 PEPPERWOOD RIDGE PTY LIMITED V NEWCASTLE CITY COUNCIL Judgment 1 GILES JA: I agree with Tobias JA. 2 TOBIAS JA: Pepperwood Ridge Pty Limited (the appellant) is the owner of four parcels of land known as Nos. 164-168 Lake Road, Elmore Vale (the land) which are located within the local government area of the City of Newcastle. Under Newcastle Local Environmental Plan 2003 (the LEP), the land is zoned 7(c) Environmental Investigation Zone. 3 On or about 24 March 2004, the appellant lodged a development application with the Newcastle City Council (the respondent), proposing to construct 51 aged and disabled units upon the land. That form of development is prohibited in Zone 7(c) of the LEP. However, the appellant maintained that its proposed development was permissible with the respondent's consent pursuant to the provisions of State Environmental Planning Policy (Seniors Living) 2004 (the Policy). 4 The respondent has not determined the appellant's development application because it contends that the Policy does not apply to the land as it is excluded by clause 4(2)(a) of the Policy, which is set out below. Accordingly, on or about 17 January 2005 the appellant instituted Class 4 proceedings in the Land and Environment Court of New South Wales seeking a declaration that the Policy applied to the land and for consequential orders. 5 The proceedings were heard by Pain J who, in a judgment delivered on 29 July 2005, upheld the respondent's contention that the Policy did not apply to the Land and that the appellant's proposed development was thus prohibited. It is from that decision that the appellant appeals to this Court. The relevant provisions of the Policy 6 Clause 4 of the Policy relevantly provides as follows: "(1) This Policy applies to land within New South Wales: (a) that is zoned primarily for urban purposes or that adjoins land zoned primarily for urban purposes; and (b) on which development for the purpose of any of the following is permitted: (i) dwelling-houses … (2) This Policy does not apply to: (a) land described in Schedule 1 (Environmentally sensitive land), …" 7 Schedule 1 to the Policy, which is headed "Environmentally Sensitive Land", is in the following terms: "Land identified in another environmental planning instrument by any of the following descriptions or by like descriptions or by descriptions that incorporate any of the following words or expressions: (a) coastal protection (b) conservation (but not land identified as a heritage conservation area in another environmental planning instrument), (c) critical habitat, (d) environment protection, (e) open space, (f) escarpment, (g) floodway, (h) high flooding hazard, (i) natural hazard (j) high bushfire hazard, (k) scenic (but not land that is so identified if: (i) the land is within a residential zone in which development of two storeys or more in height is permitted, or (ii) an adjacent residential zone, also identified as scenic, permits development of two storeys or more in height), (l) water catchment, (m) natural wetland. … " 8 The relevant "descriptions" relied upon by the respondent in support of its contention that the Policy did not apply to the land were those referred to as (b) conservation and (d) environmental protection. The relevant provisions of the LEP 9 Under the LEP there are three sub-zones to Zone 7. The first is Zone 7(a) Conservation Zone. The second is Zone (b) Environmental Protection Zone. The third is the subject of these proceedings, Zone 7(c) Environmental Investigation Zone. It was not contended before the primary judge or before this Court that the description of Zone 7(c) as "Environmental Investigation" satisfied the chapeau of Schedule 1 to the Policy. Rather, it was submitted that the zone objectives provided the relevant description identifying the land. The Zone (c) objectives are as follows: "(a) To provide for the development of land for purposes which will not, or will be unlikely to, prejudice its possible future development for urban purposes or its environmental conservation. (b) To conserve the rural or bushland character, and the biodiversity values or other conservation values, of the land." 10 The appellant accepts that the relevant description of the Land is found in objective (b) rather than objective (a). Thus, the respondent accepts that if it cannot succeed by relying on objective (b), it will not succeed by relying on (a). Nevertheless, aspects of both objectives were relied on by each party in their arguments. The decision of the primary judge 11 The appellant submitted before the primary judge that the Court was required to adopt a strictly textual approach in determining whether the land was land described in Schedule 1 to the Policy. Particular reliance was placed upon the decision of this Court in Warringah Shire Council v Punnett & Associates Pty Limited (2001) 122 LGERA 1. It was submitted that the question as to which land is caught by Schedule 1 was to be answered by reference to textual descriptions in the relevant environmental planning instrument. In other words, the schedule required land to be identified by a Schedule 1 description (or like description) that was to be found in the text of the relevant instrument. 12 Relevantly, it was submitted that the Zone 7(c) objectives neither described nor identified the land. Accordingly, they were irrelevant to the exercise required by the chapeau to Schedule 1 to the Policy, at least in the present case. 13 The respondent submitted before the primary judge that it was appropriate to have regard to the zone objectives as they stated what was intended for the land and how it might be developed. It was contended that the zone objectives contained "like" descriptions of the word "conservation" and the expression "environment protection" with the consequence that the Policy did not apply to the land. It was further submitted that one of the primary objectives of the zone was to ensure that land within it was not developed so as to prejudice environmental conservation. This necessarily identified the land by a description that was "like" the word "conservation" or the expression "environment protection" within the meaning of those terms in Schedule 1. 14 The primary judge accepted (at [23]) that the chapeau of Schedule 1 does not require precise correspondence between the name of the zone and one of the "descriptions" of land listed in Schedule 1. It was sufficient, she held, that the land be identified in the LEP "by like descriptions or by descriptions that incorporate any" of the specified descriptions. 15 In her Honour's view (set out at [26]), it was clear from Punnett that it was necessary to take a textual approach to determining whether the land could be categorised by reference to a like description of land as itemised in Schedule 1. In particular, her Honour relied upon a number of passages in the judgment of Mason P, with whom Beazley JA and Ipp AJA agreed, to which I shall refer below. 16 Before referring to the relevant passages in the President's judgment in Punnett, it is necessary to identify the nature of the issue before the Court in that case. The relevant land was zoned under Warringah Local Environmental Plan 1985 (the WLEP) as 6(b) (Private Recreation 'B'). Clause 5 of the WLEP incorporated a map that contained an index or legend with two categories, "Zones" and "General". The "Zones" category had eight parts of which Part 6 was headed "OPEN SPACE". This part included zones 6(a), (b), (c) and (d). The President noted that none of the four zones grouped under "6. OPEN SPACE" used the term "OPEN SPACE" as part of their short description. 17 In Punnett, the Council contended that the relevant land was identified in the WLEP by the description "OPEN SPACE", which was one of the specified descriptions in Schedule 1 to the Policy. 18 On the other hand, the developer submitted that although the map formed part of the WLEP, the task of identification required by the chapeau of Schedule 1 to the Policy needed to be focussed through the lens of the instrument. The map, it was argued, had no function other than to serve the purpose of that instrument. Accordingly, regard could only be had to the description in the relevant zone, which did not contain the words "open space" or any other like expression. On such an approach, the developer submitted that nothing turned upon the heading "6. OPEN SPACE" that introduced the four zones in Part 6. The heading had no operative effect and was nothing more than a cartographer's flourish. 19 Before dealing with the developer's submissions, the President made the following general observation with respect to Schedule 1 (at 12 [26]): "It is clear that Sch 1 is concerned with more than zonings, because the third last item in the list specifically excludes land identified by its 'scenic' aspects if the land is within a residential zone. This is a further pointer to the potential width of Sch 1's application and to its capacity to have a blunt application if any of its identifying words are found in a planning instrument." 20 With respect to the developer's submissions, particularly as to the relevance of the heading "6. OPEN SPACE" in the index to the map, the President said (at 12-13): "31 The non-essentiality of the heading may be conceded. But, in my opinion, this does not rob the heading of its descriptive capacity. The heading serves to group the four zones as a genus. Whether this reflects perceivable commonalities among them and/or town planning practice does not matter. The developer does not suggest that the grouping is perverse, only that it is unnecessary. To my mind this is not enough to escape the reinforced textualism of Sch 1. 32 I cannot read into Sch 1 the idea that the only verbal descriptions capable of attracting the Schedule are those to which the environmental planning instrument assigns some discrete operative effect. Identification by description is sufficient; and the incorporation of the map into the LEP means that the identification is made 'in' the LEP. … 35 … I have endeavoured to explain that Sch 1 does not require the words to be operable or functional in the sense of explicating the zoning parameters, or indeed any other operative part of the LEP. It is sufficient, in my view, that they are used descriptively with reference to the subject land. … 37 … Schedule 1 to SEPP 5 gives effect to the otherwise neutral heading '6. OPEN SPACE' if, as I conclude, Sch 1 engages those words as one of the descriptions in WLEP 1985 that identifies inter alia the subject land." 21 After referring to some of the passages from the judgment of Mason P in Punnett (to which I have referred above), the primary judge in this case observed (at [28]): "In Punnett the heading 'Open Space' in a table appearing on the zoning map was held to be a description of land falling within the schedule. That phrase did not otherwise appear anywhere in the relevant instrument. The Court of Appeal did not expressly consider whether the zone objectives in that case were a relevant consideration in determining whether the subject land could be described as a category of land listed in Sch 1 of SEPP 5." 22 Her Honour then referred to the decision of Bignold J in Druitts Developments Pty Ltd v Gosford City Council (2001) 113 LGERA 61, a decision which preceded Punnett but which was not referred to in that judgment. In Druitt the relevant land was within "Zone No. 2(f) Residential (Beach Frontage)". The question was whether the land was identified in the relevant local environmental plan by a description which was "like" the expressions "coastal protection" and "natural hazard" listed in Schedule 1 to the Policy. 23 It was common ground that no such description was found in the heading to the Zone. The plaintiff therefore relied upon the objective to the Zone, which was stated as follows: "The objectives of Zone No. 2(f) is to ensure that low scale development on land situated in proximity to public areas or identified as being subject to hazard from the coastal erosion and storms (or both) is located and constructed so as to avoid or minimise the potential hazard and minimise visual impact." 24 Bignold J (at 67 [28]) held that two conditions needed to be satisfied in order for the stated objective to qualify as a relevant source for identifying land for the purpose of Schedule 1. The first was that "the expression 'subject to hazard from coastal erosion and storms (or both)' must satisfy the verbal description of Sch 1 by being either a 'like description' or a 'description that incorporates' any of the verbal descriptions contained in Schedule 1 ..." 25 His Honour then held (at 67 [30]) that the expressions employed in the Zone objective amounted to a description of land that was "like" the descriptions contained in Schedule 1, namely, "coastal protection" and "natural hazard". 26 In the present case, the primary judge (at [32]) concluded that "the zone objectives may be a relevant consideration in the determination under Sch 1 of SEPPSL if the zone objectives provide relevant and clear descriptors of the subject land." 27 Having held that the chapeau to Schedule 1 clearly provided that like descriptions beyond those in the zone name could fall within Schedule 1, her Honour (at [34]) considered that "zone objective (a) does identify by description the site as either an area of ' conservation ' or ' environment protection ' pursuant to Sch 1 given the reference to ' environmental conservation '." 28 Furthermore, she considered (at [35]) that zone objective (b) provided a "like" description of the land as "conservation" because "[i]n my view, as zone objective (b) provides that the objective of the zone is to conserve the biodiversity values and conservation values of the land, the site is sufficiently identified by words of like description as 'conservation' land." 29 It therefore followed that the land was described in Schedule 1 for the purposes of clause 4(2) with the consequence that it was excluded from the operation of the Policy. The parties' submissions 30 The appellant submitted that, as a consequence of the decision in Punnett, the chapeau of Schedule 1 was concerned with more than zonings. However, it was nevertheless necessary to find words in the LEP that were "used descriptively with reference to the subject land". It was common ground that the words "environmental investigation", being the short name of the zone, did not amount to a description or like description of any of the words or expressions specified in paragraphs (a) to (m) of Schedule 1. 31 The objectives of the zone were therefore the only other textual source potentially capable of identifying the land for the purposes of excluding it from the Policy. However, the appellant argued that objective (a) did not in fact identify the land the subject of the zone by either of the descriptions contained in subparagraphs (b) or (d) of Schedule 1 or by like descriptions. It merely identified that the development of the land should not prejudice its possible future development for urban purposes or environmental conservation. 32 The appellant made a similar submission with respect to objective (b), which was directed towards the development of land and not to its identification. In particular, it was argued that the words used in objective (b) were not used descriptively with reference to the land within the zone. On the contrary, by virtue of clause 8(b) of the LEP, they were merely matters that the consent authority was required to consider before granting consent to a development application with respect to land within the zone. 33 The respondent submitted, firstly, that the decision of this Court in Punnett made it unnecessary for the text relied upon for the purpose of identifying the Land to have any operative effect. This would be so, the respondent argued, notwithstanding that the zone objectives in the present case in fact are operative and functional controls on the use and development of the land within the zone by force of clause 8 of the LEP. The test for the engagement of Schedule 1 is simply that verbal markers of any of the relevant or like descriptions identify the land. 34 The respondent further submitted that it would be sufficient if these verbal markers could be found in any part of the text referrable to the zone, that is, in the objectives. Accordingly, an examination of the objectives, and in particular objective (b), establishes that the verbal marker "conservation" is contained within its text and thus constitutes the identification of the land by the description "conservation". Does the Policy apply to the appellant's land? 35 The issue to be determined in the present case, as it was in Punnett, is whether the land is "identified" in the LEP by any of the following "descriptions", or by like descriptions that incorporate any of the following words or expressions "(b) conservation (d) environment protection". 36 Punnett is authority for the proposition that in determining this issue the Court is not confined to the short name given to the relevant zone. Nonetheless, there must be words in the text of the LEP, or the map referred to as part of the LEP, which are "used descriptively with reference to the subject land": Punnett (Mason P) at 35 [13]. In my opinion, this requires that the words relied upon be words of description that identify the land in accordance with one or more of the words or expressions set forth in (a) to (m) of Schedule 1. 37 Accordingly, the key question in the present case may be stated as follows: are there words in objective (b) which identify the Land by the description "conservation" or any like description? In my opinion, the chapeau of Schedule 1 is not satisfied merely because the word "conservation" is found in objective (b). 38 As the appellant points out in its written submissions, the verbal markers specified in one or more of the paragraphs (a) to (m) of Schedule 1 to the Policy may be found in the objectives to a number of other zones in the LEP. For example, in Zone 1(a) Rural Residential Zone, objective (a) is to accommodate rural and semi-residential development that is "sensitive to the environment". Is that textual reference used descriptively with reference to identifying the land the subject of that zone? Again, in Zone 2(a) Residential Zone, objective (a) is to accommodate a diversity of housing forms that respect, inter alia, "the quality of the environment". Is the word "environment" used in the objective descriptively with reference to identifying the land the subject of that zone? In Zone 5(b) Special Uses Reservation Zone, objective (b) is to reserve for open space purposes land possessing, among other things, "special conservation value". Do the words of that objective identify the land within that zone by the necessary description? 39 During the course of argument, the parties referred to the provisions of s26(3)(b) of the Environmental Planning and Assessment Act 1979, which provides that the environmental planning instruments described in the subsection are local environmental plans that "(b) make provision for the development of land that is identified by a map or a description". 40 The words of s26(3)(b) resonate in the chapeau of Schedule 1. When combined with clause 4(2)(a) of the Policy, Schedule 1 relevantly mandates that the Policy not apply to land that is identified in the LEP by one or more of the listed descriptions or some like description. As noted above, in order for the chapeau to exclude the land from the operation of the Policy, this Court must be able to locate in objective (b) a textual reference that identifies the land by the description "conservation" or "environment protection" or some like description. More broadly, and adopting Mason P's approach in Punnett, for words in a zone objective to be relevant to an enquiry such as the present, words must be used descriptively in the LEP by way of identifying the land, those words being one or more of the descriptions contained in paragraphs (a) to (m) of Schedule 1, or like descriptions. 41 For the words of objective (b) to Zone 7(c) to satisfy the foregoing test, it would, in my opinion, be necessary to find that the words identify the land by describing it by reference to the conservation values that are to be conserved. But in my view, it is not possible to find that the objective uses the words "conservation values", or any other words in the objective, to identify the land in the zone by description. On the contrary, the word "conservation" is not one of the descriptors used in the objective to identify the land. Instead, it serves the purpose of attempting to ensure that the development of the land shall not prejudice its possible future development for urban purposes or environmental conservation. It is a general objective to be sought, through being considered to be required by clause 8(b) of the LEP and not necessarily always achieved in the development of the land in the zone, but is not an identifying description of that land. 42 The same conclusion can be made with respect to the first two questions I posed in [38] above, each of which should be answered in the negative. On the other hand, the third question I posed in [38] might be closer to the mark, were it not for the requirement that the land was to possess particular characteristics. If the objective of the zone had been to reserve the land within the zone for open space purposes, then it may well be that those words could be regarded as identifying the land by the description referred to in sub-paragraph (e) of Schedule 1, namely, open space. Accordingly, I would accept the appellant's submission that the objectives of a zone may be framed in such a way that they contain words of description which identify land in terms of one or more of the words or expressions set forth in paragraph (a) to (m) of Schedule 1. But the relevant objectives are not so framed in the present case. Conclusion 43 It is apparent from the foregoing that the issue for determination in this appeal is simple to state but difficult to resolve. However, I have come to the conclusion that the words in objective (b) to Zone 7(c) are not used as words of description to identify the land for the purpose of Schedule 1 to the Policy. It accordingly follows that the primary judge was in error in holding to the contrary. 44 I would therefore propose the following declaration and orders: (a) Appeal allowed; (b) Set aside Order 1 made by Pain J on 29 July 2005; (c) Declare that the land known as 164-168 Lake Road, Elmore Vale is land to which the State Environmental Planning Policy (Seniors Living) 2004 applies; (d) The respondent to pay the appellant's costs of the proceedings to date in the Land and Environment Court and of the appeal. 45 McCOLL JA: I agree with Tobias JA. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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