New South Wales Court of Appeal CITATION: Castle Constructions Pty Limited v North Sydney Council [2009] NSWCA 169 HEARING DATE(S): 24 June 2009 JUDGMENT DATE: 24 June 2009 JUDGMENT OF: Campbell JA at 1, 36; Macfarlan JA at 35 EX TEMPORE JUDGMENT DATE: 24 June 2009 DECISION: Application for leave to appeal dismissed with costs. CATCHWORDS: APPEAL – appeal – Land and Environment Court – leave to appeal to the Court of Appeal – whether to grant leave to appeal under section 57(4) Land and Environment Court Act 1979 – appeal from a section 56A decision of a judge of the Land and Environment Court – factors influencing the decision whether or not to grant leave to appeal – whether the existence of a subsequent successful development application is a ground to refuse leave – weight to be given to a draft Local Environmental Plan not properly exhibited to the public – weight to be given to procedural history which discloses multiple rejections of the Development Application on the merits – whether appeal has sufficient prospects of success – ENVIRONMENT AND PLANNING – building control – decision to grant Development Approval – Land and Environment Court – appeal from decision of a Commissioner under section 56A Land and Environment Court Act – proper approach to reviewing findings of a Commissioner – review of findings should be taken as a whole and in their context LEGISLATION CITED: Environmental Planning and Assessment Act 1979 Land and Environment Court Act 1979 CATEGORY: Principal judgment Castle Constructions Pty Ltd v North Sydney Council [2006] NSWLEC 5 Castle Constructions Pty Ltd v North Sydney Council [2006] NSWLEC 468 Castle Constructions Pty Ltd v North Sydney Council [2007] NSWCA 164; (2007) 155 LGERA 52 CASES CITED: Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 1168 Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 239 Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 1456 Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 137 Castle Constructions Pty Ltd v North Sydney Council [2009] NSWLEC 18 PARTIES: Castle Constructions Pty Limited (Applicant) North Sydney Council (Respondent) FILE NUMBER(S): CA 40072/09 COUNSEL: TF Robertson SC; JE Lazarus (Applicant) MJ Leeming SC; HP Irish (Respondent) SOLICITORS: McLachlan Thorpe Partners (Applicant) Mallesons Stephen Jaques (Respondent) LOWER COURT JURISDICTION: Land & Environment Court LOWER COURT FILE NUMBER(S): 11010/05 LOWER COURT JUDICIAL OFFICER: Pain J LOWER COURT DATE OF DECISION: 27 February 2009 LOWER COURT MEDIUM NEUTRAL CITATION: Castle Constructions Pty Limited v North Sydney Council [2009] NSWLEC 18 IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40072/09 CAMPBELL JA MACFARLAN JA 24 JUNE 2009 CASTLE CONSTRUCTIONS PTY LTD v NORTH SYDNEY COUNCIL Ex Tempore Judgment 1 CAMPBELL JA: This is an application for leave to appeal from a decision of Pain J in the Land and Environment Court in which her Honour dismissed an appeal on a question of law from the Commissioner: Castle Constructions Pty Ltd v North Sydney Council [2009] NSWLEC 18. That appeal to Pain J had itself been brought under section 56A of the Land and Environment Court Act 1979. 2 Leave is needed for a further appeal to this Court because of the provisions of section 57(4) of the Land and Environment Court Act providing that an appeal does not lie to the Supreme Court against an order or decision made on appeal under section 56A, except by leave of the Supreme Court. 3 The appeal related to a Development Application that the applicant lodged with the respondent council, seeking development approval to a multi-storied mixed use development to be constructed at 136-140 Walker Street, North Sydney. 4 That Development Application, in various forms that it has had, as the building to which it relates has gradually shrunk to deal with particular objections made to it, has been considered in numerous places. The first was in the council, which rejected the Development Application on 31 August 2005. There was a Class 1, or merits, appeal from that decision to the Land and Environment Court; it was heard by Senior Commissioner Roseth (Castle Constructions Pty Ltd v North Sydney Council [2006] NSWLEC 5). He dismissed an appeal against the council's decision. Though the decision of Senior Commissioner Roseth was set aside because it contained a legal error, the Senior Commissioner expressed a view of the merits that was significantly unfavourable to the size – particularly the scale, form and massing – of the development. 5 There was an appeal from Senior Commissioner Roseth's decision under section 56A Land and Environment Court Act. Talbot J upheld the appeal (Castle Constructions Pty Ltd v North Sydney Council [2006] NSWLEC 468). There was then an appeal to the Court of Appeal (in Castle Constructions Pty Ltd v North Sydney Council [2007] NSWCA 164; (2007) 155 LGERA 52) against Talbot J's decision. The matter was remitted to a different Commissioner because of the strength of the views that Senior Commissioner Roseth had of the merits of the proposal. 6 The Council made an application for special leave to appeal from the Court of Appeal's decision to the High Court, but discontinued it. 7 Ultimately, the remitted merits appeal came to be heard by Commissioner Bly (Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 1168). He upheld the council's refusal of the Development Application. 8 There was then an appeal to Biscoe J under section 56A of the Land and Environment Court Act (Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 239). That appeal was also upheld, on the basis that there had been a denial of procedural fairness and a failure to consider relevant evidence. The matter was then remitted to Commissioner Bly to deal with in accordance with the reasons of Biscoe J. 9 Commissioner Bly reconsidered the matter and, in his second decision, still refused the Development Consent (Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 1456). There was then an appeal under section 56A against the second decision of Commissioner Bly to Pain J (Castle Constructions Pty Ltd v North Sydney Council [2009] NSWLEC 18). It is from that appeal that the present application for leave to appeal to this Court is brought. 10 The question of law that is said to be involved in the application for leave to appeal is said to concern the construction of a provision in the relevant planning instrument that imposes a height control on the subject land. The land is located within the North Sydney Central Business District. An area having quite precise boundaries is identified and given that name in the relevant planning instrument. The area is irregular in outline, with Miller Street and Walker Street as the main streets running through it in roughly a north-south direction, and Berry Street is one of the significant streets running through it in, roughly, an east-west direction. The subject site is quite close to one of the northern edges of the CBD, though not right on it, and the eastern edge of the District runs along that part of Walker Street that the site is located on. 11 The relevant planning instruments include a North Sydney Local Environmental Plan 2001. It includes a clause 28D, that contains provisions as follows: "(1) Building heights and massing objectives The specific objectives of this clause are as follows: (a) to achieve a transition of building heights generally from 100 Miller Street (Northpoint) and 79-81 Berry Street (being the location of the tallest buildings) stepping down towards the boundaries of the North Sydney Centre, … (5) Building design and public benefits When determining whether or not to grant consent to a development application in respect of land within the North Sydney Centre, the consent authority must consider: (a) the impact of the proposed development in terms of scale, form and massing within the context of the locality and landform, the natural environment and neighbouring development and in particular lower scale development adjoining the North Sydney Centre, …" 12 There is also a North Sydney Development Control Plan 2002 that contains a character statement applicable to the District. It includes, in clause 1.1h, the following: "Skyline … i. Buildings step down in height from the tallest buildings, being Northpoint (100 Miller Street) and Shopping World (79-81 Berry Street) to the boundary and surrounding residential areas (see fig. 1.1 and fig. 1.2). ii. Roof design contributes to building's appearance from a regional view catchment." 13 The figures that are referred to in that planning control are silhouettes of the buildings one could see if one were looking at the North Sydney CBD in a direction that was crossed, as to one of the figures, by Miller Street, and that was crossed, as to the other figure, by Berry Street. Each figure shows in dark grey the silhouettes of existing buildings with an arc imposed over the top of them. Each arc was shaped, roughly, like the arch of the Harbour Bridge, so that tall buildings lie under it at the arc's centre and smaller buildings lie under it at the edges. There are also some light grey rectangular silhouettes shown under it at various locations, but so that no silhouette breaks out above the line of the arc. The description under the figures are, respectively: "Figure 1.1 Stepping down of building heights along Miller Street. Potential increase in height shown in light grey. Figure 1.2 Stepping down of building heights along Berry Street. Potential increase in height shown in light grey." 14 By the time of Pain J's decision it was common ground that the height controls arising from the arcs needed to be extrapolated, so that they applied in a three-dimensional way to the whole of the CBD. 15 There are four reasons put forward by the council why leave should not be granted, which are not ones that I would rely on to refuse leave. 16 The first of them was that the question of law that is sought to be argued on this appeal is different to the one that was argued before Pain J. I accept that there is a difference in the way the point has been formulated, but her Honour, in substance, considered the same point as is sought to be raised on appeal in this Court. 17 The second is that there has been a Development Approval granted by the council to this applicant and concerning this site. It is for a smaller building than is the subject of this application for leave to appeal. That Development Approval was granted in October 2008. I do not regard that as determinative because there is no reason why a landowner cannot pursue two Development Applications simultaneously, in the hope of ending up with two approvals, at which stage it can choose to implement whichever of them is more advantageous. The fact that that Development Approval has been granted is a small factor to take into account in deciding whether to grant leave, but, in my view, is of very little weight. 18 The third is a submission that there is no matter of general importance involved in this appeal. There is some evidence that the planning controls applicable to the height of buildings in North Sydney CBD might change, so that the controls that are the subject of this application cease to apply. 19 We have received some evidence about the status of those possible changes. I am not satisfied that there is sufficient certainty that there actually will be changes as to warrant a positive conclusion as at today that the present planning controls will not need to be applied to a significant number of applications in the future. 20 The fourth matter is that, since the second decision of Commissioner Bly, there has been a change in status of a draft LEP. At the time of Commissioner Bly's first and second decisions, there was in existence a document in the form of a draft LEP. It had been decided by Lloyd J, in another piece of litigation that this applicant brought in the Land and Environment Court (Castle Constructions Pty Ltd v North Sydney Council [2008] NSWLEC 137), that that draft LEP had not been validly exhibited and, therefore, did not have the status of being a draft LEP that was entitled to the type of consideration that section 79C(1)(a)(ii) Environmental Planning and Assessment Act 1979 ("EPA Act") requires be afforded. 21 Even so, Commissioner Bly took into account, in each of his decisions, that document in the form of a draft LEP, under the heading in section 79C(i)(e) EPA Act "the public interest". He accorded it, under that heading, less weight than it would have had, had it been what one might call a fully fledged draft LEP. He has not been criticised in submissions for so doing. 22 Since the second decision of Commissioner Bly, the draft LEP has been approved for public exhibition. It has, therefore, advanced to the status of an instrument that falls within section 79C(1)(a)(ii) of the EPA Act, and is, therefore, entitled to greater weight than Commissioner Bly afforded it in his previous decisions. 23 When the draft LEP is entitled to a greater weight, it would have a tendency on remittal of the matter from a successful appeal in this Court towards refusal of approval for the development application. I say that it would have a tendency to refusal of the application because the draft LEP is somewhat more precise about the height of building that is permitted on the land in question than are the presently gazetted planning controls, and the control the draft LEP imposes would be harder for the building in question to comply with. However, it is not possible for this Court now to conclude that that change in status of the draft LEP would inevitably result, or was likely to result, in refusal of the application. 24 Even though those four reasons are, in my view, not sufficient to refuse leave, there are other reasons why the application for leave should fail. 25 The first and less powerful consideration is that the history of the matter shows that the Development Application, admittedly for a building in the ever-shrinking forms that I have earlier mentioned, has now been rejected on four separate occasions when the merits were considered; once by the elected representatives on the council and three times by two different Commissioners in the Land and Environment Court. That there should be a third level of appeal from the latest decision of Commissioner Bly that, if successful, would lead to a fifth merits review of the application is, in itself, somewhat undesirable, given that there is a clear legislative policy of limiting such appeals. That is not to say that there may not be cases where such a course is the appropriate one. Thus, that reason is not, of itself, sufficient to warrant refusal of the application. 26 The principal reason for refusing leave concerns the prospects of success of the appeal. The decision of Pain J was that there was no error of law involved in the Commissioner's decision. That decision depended upon an understanding of some paragraphs in the Commissioner's decision that concluded with paragraph [34]. Paragraph [34] itself concluded by saying: "However, it is also important to remember that visual dominance and transition towards the boundaries of the centre are important considerations as are streetscape and topography and the area character statement in the DCP. In this context I accept that a reasonable interpretation of the notional arcs in the light of the planning controls is that there be reasonably uniform building heights around the perimeter of the centre." 27 The decision of Pain J was that there was no error of law involved in that statement, properly understood in its context. 28 In his second decision Commissioner Bly drew on, to some extent, his first decision, insofar as it was not affected by the errors Biscoe J found. In particular, in paragraph [29] of his first decision he took into account clause 28D(5) of the LEP, with its requirement for consideration of impacts associated with scale, form and massing in the locality and on neighbouring and lower scale developments adjoining the North Sydney centre. Even though the Commissioner said in paragraph [34] of his second decision that what he was doing was arriving at "a reasonable interpretation", what he was seeking to do, it seems to me, was not an exercise in pure interpretation of the height controls. 29 Rather, paragraph [34] of Commissioner Bly's second decision is more in the nature of a conclusion about the type of practical result that follows from seeking to apply together not only the arc controls, but also other planning criteria. There are evaluative elements involved in arriving at the conclusion that it expressed, not just matters of construction. The conclusion that the Commissioner came to, that what was required were "reasonably uniform building heights around the perimeter of the centre", is far from precise. It is not saying that the arc controls positively require that there be uniformity of height around the boundaries. Thus, in my view, paragraph [34] of the decision is not a conclusion on a matter of construction of a planning instrument. 30 As Pain J said in her judgment, at [38]: "Particularly relevant is the third sentence of [34] which refers to the issues of visual dominance, transition towards the boundaries of the centre, streetscape and topography, and the area character statement in the DCP as discrete matters. These are separate from the notional arcs and arise from the LEP and DCP character statement. These factors inform the concluding sentence of [34] and for that reason the Commissioner was not therefore drawing the bald conclusion stated in the question of law in this appeal". 31 In taking this view, her Honour was correctly applying the principle that, in a section 56A appeal, findings of a Commissioner should be considered in the context of the appeal as a whole, and a fine-tooth comb approach not adopted. 32 There was an argument by the applicant that the northern part of Miller Street is itself at a boundary of the District for eight or so buildings, yet the arc control must have envisaged that the buildings on those sites would not be uniform in height but, rather, tapering down towards the northern end. 33 I do not see why such a tapering down could not happen, consistently with the height of the buildings being also "reasonably uniform" at the boundaries of the District. 34 It is because the prospects of success on the appeal are insufficiently good that I would refuse leave. 35 MACFARLAN JA: I agree. 36 CAMPBELL JA: The order of the Court is, therefore, that the application for leave to appeal is dismissed with costs. ********** 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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