Land and Environment Court New South Wales Medium Neutral Citation: Hrsto v Canterbury City Council (No 2) [2014] NSWLEC 121 Hearing dates: 7 February 2014 Decision date: 14 August 2014 Jurisdiction: Class 1 Before: Sheahan J Decision: (1)The separate question posed by the parties is answered in the affirmative. (2)The question of the costs of this hearing is reserved. (3)The matter is referred back to the Registrar for further directions on Friday 22 August 2014. (4)Exhibit C2 may be returned. Catchwords: CONSTRUCTION and INTERPRETATION: Is some of the residential component of the proposed development 'shop top housing'? - principles of construction and characterisation. Legislation Cited: Environmental Planning and Assessment Act 1979 Canterbury Local Environmental Plan 2012 Cases Cited: Abret v Wingecarribee Shire Council [2011] NSWCA 107; (2011) 180 LGERA 343 Baulkham Hills Shire Council v O'Donnell (1990) 69 LGRA 404 Botany Bay City Council v Pet Carriers International Pty Limited [2013] NSWLEC 147; (2013) 201 LGERA 116 Chamwell Pty Limited v Strathfield Council [2007] NSWLEC 114; (2007) 151 LGERA 400 Council of the City of Newcastle v Royal Newcastle Hospital [1957] HCA 15; (1957) 96 CLR 493; (1957) 4 LGRA 69 Cranbrook School v Woollahra Council [2006] NSWCA 155; (2006) 66 NSWLR 379; (2006) 146 LGERA 313 Crosland v North Sydney Council [2000] NSWLEC 165; (2000) 109 LGERA 244 Foodbarn Pty Ltd v Solicitor-General (1975) 32 LGRA 157 House of Peace Pty Ltd v Bankstown City Council [2000] NSWCA 44; (2000) 48 NSWLR 498; (2000) 106 LGERA 440 Hrsto v Canterbury City Council [2013] NSWLEC 195 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 T & K Berry v Wollongong Council [2008] NSWLEC 210 Texts Cited: Macquarie Dictionary (4th ed., 2005) Category: Separate question Parties: Andrew Hrsto (First Applicant) Troy Pestano Douglas (Second Applicant) Canterbury City Council (Respondent) Representation: Mr C E Hage, agent (First & Second Applicants) Mr A Seton, solicitor (Respondent) N/A (First & Second Applicants) Marsdens Law Group (Respondent) File Number(s): 10740 of 2013 Judgment Introduction 1This judgment answers a question which has been identified and set aside for separate consideration in this Class 1 appeal against the deemed refusal of a development application ("DA"). 2The applicant's DA seeks approval to: (1)demolish all existing structures on the subject land at 717-727 Canterbury Road, Belmore, (corner of Burwood Road), and (2)build a 5-6 storey mixed use development comprising 224 residential apartments, communal facilities, basement car parking, and some ground floor retail/commercial spaces, across 5 separate structures known as "Building" "B", "C", "F", "L", and "N", respectively (shown on the plan in Exhibit C1). 3The Council contends in the appeal (Statement of Facts and Contentions Part B) that the proposal is prohibited, and (contention 2(b)) that the proposed development is "predominantly residential with only a small number of retail and commercial tenancies proposed along the Burwood Road frontage", and is, therefore, inconsistent with the stated objectives of its zone ("B2" Local Centre). 4The Council proposed, and the applicants and Biscoe J (Hrsto v Canterbury City Council [2013] NSWLEC 195) agreed to, the separation of the following question for decision in advance of other issues in the appeal: Whether the development application seeks consent for "residential accommodation" which cannot be characterised as "shop top housing" and is therefore prohibited on land within Zone B2 Local Centre pursuant to the provisions of the Canterbury Local Environmental Plan 2012 ["the LEP"]. 5"Shop top housing" is defined by dictionary in the LEP (Exhibit C2, tab 3, p91 of 97) in the following terms: shop top housing means one or more dwellings located above ground floor retail premises or business premises. Note. Shop top housing is a type of residential accommodation ... 6The dictionary does not include definitions of "one", "more" or "above". 7The issue before the Court is whether that part of the proposal which seeks consent for "residential accommodation" on the ground floor level of the project can be characterised as "shop top housing". 8The Court has been assisted by a Statement of Agreed Facts ("SAF" - Exhibit C3), and by the parties' agreement on a bundle of documents (Exhibit C2). The LEP 9The LEP is in the modern generic format, and prohibits in the B2 zone "residential accommodation" which is neither "shop top housing" nor "boarding house", as defined. (There is no "boarding house" in the proposal). 10Clause 2.3(3)(b) of the LEP (p9 of 97 in tab 3) provides that in the Land Use Table a reference to a type of building or other thing does not include a reference to a type of building or other thing "referred to separately" in the Table. "Shop top housing" is referred to separately in the Table in relation to the B2 zone, so it cannot be embraced by the definition "residential accommodation". The parties agree on this position. 11Item 3 of the Land Use Table (p13 of 97) relevantly specifies that "commercial premises", "shop top housing" and "any other development not specified in item 2 or 4" is permissible with consent in that zone, but item 4 provides that "residential accommodation" is prohibited. (The only use permitted without consent is "home occupations"). 12The dictionary to the LEP defines the word "building" (at p60 of 97) in terms of the definition of it in the Environmental Planning and Assessment Act 1979, namely: building includes part of a building, and also includes any structure or part of a structure (including any temporary structure or part of a temporary structure), but does not include a manufactured home, moveable dwelling or associated structure or part of a manufactured home, moveable dwelling or associated structure. 13The following definitions which are included in the dictionary are set out in full, for completeness: basement means that space of a building where the floor level of that space is predominantly below ground level (existing) and where the floor level of the storey immediately above is less than 1 metre above ground level (existing). business premises means a building or place at or on which: (a) an occupation, profession or trade (other than an industry) is carried on for the provision of services directly to members of the public on a regular basis, or (b) a service is provided directly to members of the public on a regular basis, and includes a funeral home and, without limitation, premises such as banks, post offices, hairdressers, dry cleaners, travel agencies, internet access facilities, betting agencies and the like, but does not include an entertainment facility, home business, home occupation, home occupation (sex services), medical centre, restricted premises, sex services premises or veterinary hospital. Note. Business premises are a type of commercial premises ... commercial premises means any of the following: (a) business premises, (b) office premises, (c) retail premises. mixed use development means a "building or place comprising 2 or more different land uses." multi dwelling housing means 3 or more dwellings (whether attached or detached) on one lot of land, each with access at ground level, but does not include a residential flat building. Note. Multi dwelling housing is a type of residential accommodation ... residential accommodation means a building or place used predominantly as a place of residence, and includes any of the following: (a) attached dwellings, (b) boarding houses, (c) dual occupancies, (d) dwelling houses, (e) group homes, (f) hostels, (g) multi dwelling housing, (h) residential flat buildings, (i) rural workers' dwellings, (j) secondary dwellings, (k) semi-detached dwellings, (l) seniors housing, (m) shop top housing, but does not include tourist and visitor accommodation or caravan parks. residential flat building means a building containing 3 or more dwellings, but does not include an attached dwelling or multi dwelling housing. Note. Residential flat buildings are a type of residential accommodation ... retail premises means a building or place used for the purpose of selling items by retail, or hiring or displaying items for the purpose of selling them or hiring them out, whether the items are goods or materials (or whether also sold by wholesale), and includes any of the following: (a) bulky goods premises, (b) cellar door premises, (c) food and drink premises, (d) garden centres, (e) hardware and building supplies, (f) kiosks, (g) landscaping material supplies, (h) markets, (i) plant nurseries, (j) roadside stalls, (k) rural supplies, (l) shops, (m) timber yards, (n) vehicle sales or hire premises, but does not include highway service centres, service stations, industrial retail outlets or restricted premises. Note. Retail premises are a type of commercial premises ... The Project 14SAF 16 records that the ground floor plan (Exhibit C1) shows the following, with respect to each "building": Building B two areas described as "Retail" having an area of 89.23m² and 102.74m², 2 x 1 bedroom dwellings and 3 x 2 bedroom dwellings. Building C the ground floor of 12 x 1 bedroom dwellings. Building F an area described as "Retail (café)" having an area of 76.77m², and area described as "Gym + Common Facilities" having an area of 189.65m² and 2 x 2 bedroom dwellings. Building L 5 x 1 bedroom dwellings, 4 x 2 bedroom dwellings and 1 x 3 bedroom dwelling. Building N 5 x 1 bedroom dwellings and 7 x 2 bedroom dwellings. 15SAF 17 notes that the proposal includes an "upper ground floor" which involves, with respect to each building: Building B 1 x 1 bedroom dwelling, 6 x 2 bedroom dwellings and 1 x 3 bedroom dwelling. Building C the upper/first floor of 12 x 1 bedroom dwellings and 12 areas described as "Office". Building F three areas described as "Retail 1", "Retail 2" and "Retail 3" each having an area of 63.34m², 87.89m² and 51.37 m² respectively, 1 x 1 bedroom dwelling and 3 x 2 bedroom dwellings. Building L 6 x 1 bedroom dwellings and 5 x 2 bedroom dwellings. Building N 5 x 1 bedroom dwellings and 7 x 2 bedroom dwellings. 16It is clear from Exhibit C1 that the area of the proposal's ground floor which is designated for residential use far exceeds the area on that level which is proposed for retail/commercial use. Submissions 17The applicants submit that the proposal meets the zone objectives by locating retail and commercial premises on main road frontages, but that it is "indivisible", and cannot be staged (Tp13, LL25 - 37). They submit that the plan (in Exhibit C1) uses the term "building", not in its statutory meaning, but merely to identify the different components of that indivisible project (Tp12, LL41 - 44). 18Further, they submit (par 21) that each of the proposed "mixed" uses of the subject land is "separately permitted and/or ancillary to the permitted development", and (par 25) that, to satisfy the definition of "shop top housing" in the LEP, only one dwelling, not "all" proposed dwellings, need be located "above ground floor retail premises or business premises", in the sense of having "a floor level that is lower (sic) than the top most part of the ground floor retail premises or business premises" (par 35, as corrected at Tp11, LL45 - 50). 19They submit that the Court should adopt a "wide view" of the term "shop top housing", because, if it were the LEP's intention that there would be no dwellings on the same level as the retail and commercial uses, it would have used the term "all", rather than "one or more" (Tp11, LL14 - 31). 20They submit (par 60) that the LEP's use of the term "shop top housing" is intended: ... to allow flexibility for applicants and consent authorities to consider alternate configurations for development, provided that at least "one or more" than one dwelling/s are located above some form of retail premises or business premises. and that (par 58): The proposal has provided retail and commercial premises to (sic) the most logical and accessible locations, namely the main road frontages to the proposed development, Canterbury Road and Burwood Road as the primary Retail Roads and has satisfied the objectives of the Zone B2 Local Centre of the CLEP 2012. 21In his oral submissions on their behalf Mr Hage said (Tp11, LL21 - 32): There's no presumption in the Canterbury Local Environmental Plan that states that all dwellings must be located above retail premises or business premises. We feel that as long as one retail premises or business premises is located on the ground floor level, it would suffice to satisfy the definition of shop top housing. So the applicants contend that the residential accommodation that is at floor level, that is lower than the topmost part of the ground floor retail premises or business premises, can be characterised as shop top housing so long as at least one dwelling in the building as defined has a floor level that is lower than the topmost part of the ground floor retail premises or business premises, your Honour. 22Their submissions are based on the characterisation of the five separate "buildings" ([14] and [15] above) "as one building, with a podium connected to a common basement car park and a switch room" (par 36). 23The various components of the proposal - residential, commercial, or retail - could not "function on the land" without the "basement, driveway ... and access ways", the physical acts of construction of which "represent the means by which the land is made to serve the 'mixed use purpose'" of the proposal (pars 19 and 54. See also Council of the City of Newcastle v Royal Newcastle Hospital [1957] HCA 15; (1957) 96 CLR 493; (1957) 4 LGRA 69, at 508). 24They contend (par 57) that: ... the character, extent and other features of the uses of the common basement and access ways and their integral relationship with the podium incorporating purposes for the use of a "mixed use development" means that it is appropriate to characterise the uses as being for the purpose of a "mixed use development" and as such must be seen as ancillary to the permissible development. 25The respondent insists (par 27 on p10, not p8) that there are five separate "buildings", to which the principles it espouses must be applied. 26Across the five buildings, there are many dwellings proposed for "a floor level that is completely higher than the top of the ground floor retail [or business or commercial] premises" proposed (see eg subs par 29 on p10, not p8), and the respondent accepts that such dwellings "would be properly categorised as being ... 'shop top housing' ... even where some of them are not directly over the top of the ground floor retail [or business or commercial] premises". 27However, a number of dwellings are proposed for the ground floor level of Buildings B and F, and would not be "above" any ground floor retail or business premises. They are "residential accommodation" not capable of being properly categorised as "shop top housing" (see pars 28 - 35 on p10, not p8 - 9). 28Home office floor space is proposed for the upper ground floor of Building C. This space would comprise business premises (par 36 on p10, not p8), but it is at ground level at Canterbury Road (par 37). Twelve dwellings proposed in Building C are not "above" any ground floor retail or business premises (par 39). 29Dwellings on the ground floor of Buildings B and F and some of those in Building C have ground floor access, and would be properly characterised as "multi dwelling housing", which is prohibited, by the LEP, in the B2 zone (par 41). 30The ground floors of Buildings L and N are proposed to have 10 and 12 dwellings respectively (with ground floor access), and no retail or business premises. The two buildings would properly be characterised, Council submits, as "residential flat buildings", which would also be prohibited in the zone (pars 42 - 49). 31The Council submits (par 28 on p8, not p10) that "only dwellings that are 'above' ground floor retail premises or business premises are capable of being characterised as 'shop top housing'". 32As the word "above" is not defined in the model/standard instrument, nor in the LEP, Council submits (par 30 on p8, not p10), and the applicants accept (par 27), that it must be given "its ordinary meaning in the context in which it appears" in the LEP. 33Council refers (par 31 on p8, not p10) to the definition of "above" in the Macquarie Dictionary (4th ed., 2005), namely "in or to a higher place; overhead", and submits (pars 32f on p8, not p10) that the "housing" indicated by the term "shop top housing" must be "at a place or level that is higher" than "the top most part of the ground floor retail premises or business premises ..." 34The respondent Council's written submissions continue (at pars 33ff on p9, not p10): 33. ... a dwelling must be in the same building as the ground floor retail premises or business premises and on a floor of that building that is at a level higher than the top most part of the ground floor retail premises or business premises in order to be characterised as "shop top housing" as defined. 34. Residential development that has a floor level that is lower than the top most part of ground floor retail premises or business premises could not be properly characterised as "shop top housing". 35. The Respondent accepts that dwellings do not need to be directly or immediately above ground floor retail premises or business premises in order to be characterised as "shop top housing". If it was intended that "shop top housing" be limited to dwellings that are directly or immediately above ground floor retail premises or business premises it is expected that those words would have been included in the definition of the term 'shop top housing'. 36. The Respondent contends that dwellings must be in the same building as the ground floor retail premises or business premises for the purposes of the term "shop top housing". However, the Respondent accepts that a broad interpretation of the word "above" in the definition should be given which would suggest that the dwellings need only be at a floor level that is higher than the top of the ground floor retail or business premises and do not need to be contained in an envelope on the higher floor level that would be intersected by a line drawn vertically from within the envelope of the ground floor retail or business premises. 35In his oral submissions on Council's behalf, Mr Seton relied on cl 2.3(3)(b) of the LEP, which provides: A reference to a type of building or other thing does not include, despite any definition, being a reference to a type of building or other thing referred to separately in the land use table in relation to the same zone, and submitted (Tp7, LL8 - 14): So once you take shop top housing out of the definition of "residential accommodation", the conflict is no longer there between the two uses, so you can have shop top housing as a permitted development in this zone even though it is a form of residential accommodation, but there is no other form of residential accommodation that is permitted on land within this zone, other than, as I said, boarding houses which are not relevant here. There's no argument that boarding houses are proposed on this site. 36Mr Seton insists (Tp14, LL22 - 31 and LL41 - 44) that multiple dwellings located above the retail and commercial premises may be categorised as "shop top housing", and, in order to be "above" the retail and commercial premises, a dwelling "has to be above the topmost part" of them. Most of the dwellings here proposed are "above", as so defined, but those on the ground floor level are not, and they cannot be "grandfathered" into the category of "shop top housing". 37He also submitted (Tp8, LL20 - 27) that that part of the proposal "that comprises of shop top housing, being the dwellings that are above, and any of the dwellings that are above the ground floor retail or commercial premises are permitted, but the dwellings and the 41 of them that are at the ground floor level, being the same level as the commercial and retail premises, are just residential accommodation that is not excluded from the definition", and (Tp9, LL1 - 8) that such dwellings not permitted as "shop top housing", namely the 41 out of 228 (Tp7, L45), which are "at the ground floor level" (Tp8, L25), and so "not above any ground floor retail or commercial premises" (Tp14, L29), are prohibited (residential) development. 38In that situation (Tp14, LL13 -15), "whether it's characterised as being one building or five separate buildings doesn't really matter on the basis of the ground floor plan that is proposed in this particular development". 39In response (Tp14, LL17 - 19) to the respondent's submission "that if you have one or more dwellings above ground level, then all dwellings in the development can be categorised as shop top housing", Mr Seton said (Tp14, LL23 - 31): ... that simply can't be correct in this particular case. We accept that any of the dwellings that are located above - so there can be multiple dwellings located above ground floor retail commercial premises, as the definition says "one or more", and that's the only work that those words have to do, except that they can be categorised as shop top housing but where the dwellings are not above, and the substantial number of them in this case, 41 of them, are not above any ground floor retail or commercial premises, they simply can't be categorise or characterised as being for the purpose of shop top housing. 40The Council disputes the applicant's submission that the development is permissible as a "mixed use development" (defined in [13] above), under item 3 in the zoning table (as an innominate use). 41Mr Seton relies on the Court of Appeal's reasoning in Abret v Wingecarribee Shire Council ("Abret") [2011] NSWCA 107; (2011) 180 LGERA 343, to submit that that term (Tp8, LL15 - 18): doesn't have any work to do in the context of the zoning table that applies to B2 because it's not a term that is specifically mentioned anywhere within B2. Nor is it an exclusion from "residential accommodation" definition. 42Beazley JA said in Abret at [62]: On this approach, which in my opinion is correct, the appellant's argument that because 'seniors housing' is a defined term within the LEP and is not listed as a prohibited use in the planning table, it is permissible with consent, must be rejected. The matter cannot be approached so simply. Rather, it is necessary to characterise the use, so that, if the purpose of the use is otherwise controlled under the LEP, the proposed use is controlled by that provision. However, the rejection of that argument does not conclude the matter in the respondent's favour. It is still necessary to characterise the use by reference to the purpose of the development. 43Council also refutes the applicant's submission that the challenged ground floor residential elements are "ancillary" to the permissible retail and commercial uses. Discussion 44The proper construction of LEPs and the proper characterisation of development are everyday tasks in this Court, and, although each case depends on its own facts, the general principles are well-recognised and regularly quoted. 45On characterisation, see, eg, the Chief Judge's analysis and discussion in Chamwell Pty Limited v Strathfield Council [2007] NSWLEC 114; (2007) 151 LGERA 400, and in Botany Bay City Council v Pet Carriers International Pty Limited [2013] NSWLEC 147; (2013) 201 LGERA 116. On construction principles, see, eg, the High Court in Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355, and the Court of Appeal in Cranbrook School v Woollahra Council [2006] NSWCA 155; (2006) 66 NSWLR 379; (2006) 146 LGERA 313. 46When construing an LEP, any particular provision must be construed within the context of the instrument as a whole, including its stated objectives: Abret, at [45]. Also I would again adopt here what Beazley JA said, in Abret (at [62] - quoted at [42] above). 47As Jagot J observed, in T & K Berry v Wollongong Council [2008] NSWLEC 210, at [34] (emphasis mine): Whether a place is being used as a manager's residence or not, as with all questions of the purpose of a use, will depend on a common sense assessment of the character, extent and features of the various uses and the ends they apparently serve. 48The long-debated question of using dictionaries to arrive at the meaning of a term in a document was revisited, in detail, by the Court of Appeal in House of Peace Pty Ltd v Bankstown City Council ("House of Peace") [2000] NSWCA 44; (2000) 48 NSWLR 498; (2000) 106 LGERA 440, at [25] - [33]. 49Mason P said, at [28] and [30]: 28. A dictionary may offer a reasonably authoritative source for describing the range of meanings of a word, including obsolete meanings. Dictionaries recognise that usage varies from time to time and place to place. However, they do not speak with one voice, even if published relatively concurrently. They can illustrate usage in context, but can never enter the particular interpretative task confronting a person required to construe a particular document for a particular purpose... ... 30. ... In the end it is a search for the meaning of a particular document issued in a particular context. 50Later in 2000 in this Court, Bignold J decided Crosland v North Sydney Council [2000] NSWLEC 165; (2000) 109 LGERA 244, to which the applicant in the present matter drew the Court's attention. Bignold J did not refer to House of Peace, but he had been referred to dictionary meanings of the expression "health centre" ([12]). 51His Honour said (at [23] and [24]) that the "question of the true meaning of the term 'health centre' is one of statutory construction in which dictionary meanings have a legitimate role but not a determinative role ... Dictionaries are not a substitute for the judicial determination of the interpretation and then construction of statutes and other documents". 52His Honour continued (at [24] - [26]): it is, of course, necessary first to determine what is the ordinary or natural meaning of the words used because primarily it is from that that the intention of the legislator or of the parties is to be ascertained ... And it is to be taken from the judge's understanding of the sense in which words are used ... The present case, in my opinion, is an example of a word (or expression), namely "health centre" which has gained a modern day meaning or signification which demonstrates that the dictionary meanings referred to, offer only limited assistance. In my opinion, the proposed development accords with the current day understanding and experience of the existence in our community of medical centres or health centres, being places offering an extensive range of professional services of medical and health care to the local community. 53His Honour concluded (at [36]) that the proposal there involved was "properly categorised" as a "health centre", and, so, "permissible", as it fell within the nominated permissible purpose of "hospital". 54I adopt in this case the Macquarie definition of "above" ([33] above). Conclusion 55The Council's submissions on this separate question and allied issues are clearly to be preferred. 56To qualify as "shop top housing" the relevant part of the building must be truly "above" the relevant retail or commercial parts. I respectfully adopt the Council's submissions (pars 33 - 36), set out in [34] above. 57The proposed development is not one indivisible "building", but a series of "buildings", and, as the Council contends (contention 2(b) - [3] above), the predominant use in the proposal is "shop top" residential accommodation, properly so described. 58The proposed retail, business and commercial uses are not predominant, and are not "ancillary", but they clearly serve the objective(s) of the zone, while the residential elements on the same level as those uses, i.e. ground floor, are prohibited, and not severable. 59Those offending residential elements of the proposal are fundamental to it, but they "cannot be subsumed in to the 'shop top housing' element", and they are "not ancillary or subservient to the permissible development" (Council subs pars 51 - 52). 60They do not come within the principles of "inter-dependence" of use, established by the line of cases which includes Foodbarn Pty Ltd v Solicitor-General (1975) 32 LGRA 157, Baulkham Hills Shire Council v O'Donnell (1990) 69 LGRA 404, and Botany Bay City Council v Pet Carriers Association International Pty Ltd [2013] NSWLEC 147; (2013) 201 LGERA 116. 61They constitute a substantial proportion of the project, and, therefore, in my view, probably so infect the whole proposal that it must be adjudged prohibited. 62The question the parties agreed to be separated is answered in the affirmative. 63That outcome would appear to dispose of the appeal. If so, the Council may be entitled to an order for its costs, but I will reserve that question. Orders 64The orders of the Court are: (1)The separate question posed by the parties is answered in the affirmative. (2)The question of the costs of this hearing is reserved. (3)The matter is referred back to the Registrar for further directions on Friday 22 August 2014. (4)Exhibit C2 may 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. Decision last updated: 14 August 2014