Land and Environment Court New South Wales Medium Neutral Citation: Ocean Shores Community Association Inc v Byron Shire Council (No 2) [2015] NSWLEC 162 Hearing dates: 12 October 2015 Date of orders: 14 October 2015 Decision date: 14 October 2015 Jurisdiction: Class 4 Before: Pain J Decision: 1. Expedition granted. 2. Costs reserved. Catchwords: INJUNCTIONS AND DECLARATIONS – continuation of interlocutory injunction restraining sale of land in judicial review proceedings – whether ministerial delegate validly authorised Legislation Cited: Administrative Arrangements (Administrative Changes – Ministers and Public Service Agencies) Order 2014 s 7(2) Byron Local Environmental Plan 2014 Amendment No 2 Constitution Act 1902 s 50E(1) Environmental Planning and Assessment Act 1979 (NSW) ss 35, 56(2) Government Information (Public Access) Act 2009 Land and Environment Court Rules 2007 r 4.2(3) Local Government Act 1993 ss 34, 45(1) Cases Cited: Beecham Group Ltd v Bristol Laboratories Pty Limited [1968] HCA 1; (1968) 118 CLR 618 City of Canada Bay Council v F&D Bonaccorso Pty Ltd [2007] NSWCA 351; (2007) 71 NSWLR 424 De Angelis v Pepping [2015] NSWCA 236 Donald Mark Cochrane v The Council of the Shire of Byron [1993] NSWLEC 26 Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806; (2007) 160 LGERA 1 Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335 Category: Principal judgment Parties: Ocean Shores Community Association Inc (Applicant) Byron Shire Council (First Respondent) Minister Administering the Environmental Planning and Assessment Act 1979 (Second Respondent) Representation: COUNSEL: Ms I King and Mr G Fredericks (Applicant) Mr A Galasso SC (First Respondent) Ms L Sims, solicitor (Second Respondent) SOLICITORS: Woolf Associates (Applicant) Marsdens Law Group (First Respondent) Department of Planning and Environment (Second Respondent) File Number(s): 40906 of 2015 Judgment 1. I heard an ex parte injunction application on Friday 9 October 2015 in these proceedings commenced on that day. I granted an interlocutory injunction restraining the sale of land being lot 530, DP 238451, known as the Roundhouse site at Ocean Shores (the land) the subject of the proceedings. The first respondent Byron Shire Council (the Council) has entered into contracts for the sale of the eleven lots into which this land has been subdivided on the basis that the land is categorised as "operational" under the Local Government Act 1993 (NSW) (LG Act). The matter was stood over to Monday 12 October 2015 when I heard from the Council opposing the continuation of the interlocutory injunction. The Second Respondent the Minister Administering the Environmental Planning and Assessment Act 1979 (the Minister) did not wish to address the Court on the matter of an interlocutory injunction. 2. The judicial review proceedings commenced by the Applicant seek a declaration that Byron Local Environmental Plan 2014 Amendment No 2 (LEP Amendment) is invalid and of no effect. The LEP Amendment classifies the land as "operational". The LEP Amendment is claimed to be invalid by the Applicant because the Gateway determination made on 7 November 2014 under s 56(2) of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) authorising the Council to proceed with the amendment was not made by a validly authorised delegate of the Minister. Consequently according to the Applicant the resolution of the Council on 11 June 2015 that resolved that the land be reclassified from "operational" to "community" under Ch 6 Pt 2 of the LG Act continues in force and the land is community land. Under s 45(1) of the LG Act a council has no power to sell, exchange or otherwise dispose of community land. Evidence 1. The Applicant read last Friday the affidavit of Mr Woolf, the Applicant's solicitor, sworn 9 October 2015. The exhibit to Mr Woolf's affidavit (Exhibit A) contains, inter alia, Woolf Associates' letter dated 21 February 2014 requesting the Council to cease arrangements for the sale of the land as it is "community land", the real estate advertisement of the sales, what Mr Woolf understands to be a sample contract of sale of the land and Land and Property Information property searches of the land showing the Council as owner dated 9 October 2015. The Minister's Gateway determination dated 7 November 2014 and the Council resolution reclassifying the land from "operational" to "community" also formed part of Exhibit A. Correspondence between Woolf Associates and the Respondents from 17 August 2015 to 6 October 2015 identifies the applications and progress of Woolf Associates' requests for information under the Government Information (Public Access) Act 2009 (NSW) (GIPA) concerning the process for the LEP Amendment and Mr Ray's appointment as acting deputy secretary of the Department of Planning and Environment (the Department). 2. The Applicant also read the affidavit of Ms Mangleson, president of the Applicant, sworn 9 October 2015. Ms Mangleson states that the Applicant has been involved in community action to preserve the land and that these proceedings have been brought in the public interest. She became aware that Council had entered into contracts for the sale of the land on 10 September 2015. Ms Mangleson came into possession of a sample contract for the sale of the land. She was informed by Mr Woolf that the registration of the draft plan and draft instrument as required by the contract took place on 18 September 2015. 3. The Applicant tendered an instrument of delegation under the EPA Act dated 6 October 2013 (Exhibit B). The effect of the instrument was to delegate certain ministerial functions under the EPA Act to departmental officers holding positions described in the table to the instrument. Item 1 of the table delegated to the roles of "director-general", "deputy directors general", "executive directors", "general managers" and "director metropolitan delivery" the function of "making a determination, under section 56 (2) of the [EPA] Act". 4. The Council tendered an aerial photograph of the land showing the surrounding partly residential neighbourhood (Exhibit 1). Also tendered was an extract of the Council's website titled "'Roundhouse' site – Planning Proposal to reclassify public land from 'community' to 'operational' – Orana Road, Ocean Shores" (Exhibit 2). The website extract purported to give public notice under s 34 of the LG Act. Submissions for the planning proposal were to close on 4 March 2015. 5. The Council's agenda for the ordinary meeting dated 21 May 2015 (Exhibit 3) provided background to the LEP amendment process. A staff report recommended that the planning proposal be forwarded to the Department to finalise the LEP Amendment and that a further report be considered by the Council to classify the land from "operational" to "community" land prior to the making of the LEP Amendment. The Council's agenda included the letter from Mr Ray, departmental acting deputy secretary dated 7 November 2011 granting the gateway determination and the terms of the gateway determination signed by him. A Council staff report dated 11 June 2015 recommended a Council resolution to reclassify the land from "operational" to "community" land (Exhibit 4). Chronology 1. I prepared the following chronology on the basis of the parties' evidence: 21 February 2014 Letter from Woolf Associates to Council requesting Council cease arrangements for the sale of the land due to public trust On or about 23 May 2014 Council submitted planning proposal to Minister to reclassify the land as operational land 7 November 2014 Acting Deputy Secretary (Mr Ray) of the Department purported to issue Gateway determination to the Council as delegate of the Minister 29 January 2015 – 4 March 2015 Exhibition of planning proposal together with gateway determination 21 May 2015 Council agenda for ordinary meeting (Exhibit 3) – resolution to proceed with LEP Amendment 11 June 2015 Council resolved that the land be reclassified from "operational" to "community" land 10 July 2015 LEP Amendment purportedly made 17 August 2015 Letter from Woolf Associates to the Department seeking information under GIPA on the LEP Amendment process and Mr Ray's appointment (tab 13, Exhibit A) 17 August 2015 Letter from Woolf Associates to the Council seeking information under GIPA of the LEP Amendment process (tab 14, Exhibit A) 25 August 2015 Reply from Council to Woolf Associates' letter dated 17 August 2015 that some information is publicly available and some will be formally assessed under GIPA (tab 15, Exhibit A) 1 September 2015 Department confirms receipt of Woolf Associates' letter dated 17 August 2015 (tab 16, Exhibit A) 10 September 2015 Council enters into contracts for the sale of the land conditioned on the plan of subdivision being registered 17 September 2015 Department's reply to Woolf Associates' letter dated 17 August 2015 making a part GIPA determination (tab 17, Exhibit A) 17 September 2015 Plan of subdivision of the land registered with NSW Land and Property Information Office (tab 9, Exhibit A) 1 October 2015 Further reply by Department to Woolf Associates' letter dated 17 August 2015 making a supplementary GIPA determination (tab 18, Exhibit A) 6 October 2015 Further reply by Council to Woolf Associates' email dated 17 August 2015 concerning results of information request under GIPA and requirement for advanced deposit (tab 19, Exhibit A) 7 October 2015 Letter from Woolf Associates to the Minister informing of intention to commence proceedings (tab 20, Exhibit A) 8 October 2015 Response by Department to Woolf Associates' letter dated 7 October 2015 9 October 2015 Judicial review proceedings commenced 20 October 2015 Completion date for contracts for the sale of the land 1. The Council meeting minutes of 11 June 2015 (Exhibit 4) set out a history of the land. The land was considered to be classified as operational land since 2003. Consent for subdivision of the land into eleven lots was granted by the Council (on its own application I surmise) on 8 April 2003. Subdivision works were completed in preparation for the lodgement of the subdivision certificate application prior to registration of the final plan of subdivision. Due to the possibility of a public trust existing over the land which would prevent sale of the land the Council undertook a dual process of reclassifying the land from operational to community land in June 2015 and also making the LEP Amendment to enable the reclassification of the land from community back to operational as required under the LG Act. This required the making of a Gateway determination under the EPA Act to enable the amendment process to proceed (made in November 2014), the public exhibition of the draft LEP Amendment from 29 January to 4 March 2015 resulting ultimately in the gazettal of the LEP Amendment on 10 July 2015. 2. Principles relevant to the grant of interlocutory injunctions were identified in Tegra (NSW) Pty Ltd v Gundagai Shire Council [2007] NSWLEC 806; (2007) 160 LGERA 1 and the parties addressed these in some detail. Serious question to be tried 1. The Applicant submitted last week and I accepted that there is a serious question to be tried. At issue is the effect of the Administrative Arrangements (Administrative Changes – Ministers and Public Service Agencies) Order 2014 (Administrative Arrangements Order 2014) s 7(2)(b) "Change of name of Planning and Infrastructure" which states that "a reference to the Director-General of Planning and Infrastructure is to be construed as a reference to the Secretary of the Department of Planning and Environment". Under the Ministerial delegation instrument dated 6 October 2013 powers of delegation for the making of a determination under s 56(2) of the EPA Act are delegated, inter alia, to the Director-General and Deputy Directors-General. Section 50E(1) of the Constitution Act 1902 (NSW) states that: 50E Change to references in Acts etc to Ministers, Public Service agencies and Public Service employees (1) The Governor may, by an administrative arrangements order, require a reference in any Act or statutory or other instrument, or in any contract or agreement, to a Minister, Public Service agency or Public Service employee by a specified description to be construed as a reference to a Minister, Public Service agency or Public Service employee, respectively, by another specified description. 1. The Applicant does not challenge the validity of the Administrative Arrangements Order 2014 but submits that the order cannot authorise the delegation of ministerial power under the instrument of delegation to an acting deputy secretary, as Mr Ray was at the time of making the Gateway determination. Whether the exercise of delegation by Mr Ray acting deputy secretary was authorised is the issue. Section 50E permits reference to a specified public service employee to be changed to another specified public service employee but does not operate to effect changes to classes or categories of public service employees according to the Applicant. The Council submits that the prospects of success are poor and the case is not strong. 2. I consider that the case is certainly arguable. I note that De Angelis v Pepping [2015] NSWCA 236 at [139] confirms that a failure which may be described as technical in the delegation of ministerial powers under the EPA Act should result in the Court exercising its discretion by making a declaration of invalidity of a planning instrument. The making of a Gateway determination is a fundamental part of the process of making a local environmental plan under the EPA Act. If successful in the proceedings the Applicant would be likely to obtain a declaration of invalidity of the LEP Amendment with the consequence that the land remains categorised as community land pursuant to the resolution of the Council to that effect in June 2015. The Council would therefore have no power to sell the land under s 45(1) of the LG Act. Balance of convenience 1. The Court must consider whether the injury suffered by a plaintiff if an injunction is refused outweighs the injury to a defendant if an injunction is granted, per Tegra at [13] citing Beecham Group Ltd v Bristol Laboratories Pty Limited [1968] HCA 1; (1968) 118 CLR 618 at 623. Relevant factors include whether irreparable injury will be caused, whether damages are an adequate remedy (this factor has less relevance in this matter which seeks to enforce a public planning law), whether an undertaking as to damages is offered, where the status quo lies and the relative strengths of either party's case, inter alia. 2. The sales of the eleven lots are to be finalised shortly. Ms Mangleson believed final settlement to be on Thursday 15 October 2015. Once finally sold the Applicant's cause of action would be removed as the incoming purchasers obtain indefeasible title per City of Canada Bay Council v F&D Bonaccorso Pty Ltd [2007] NSWCA 351; (2007) 71 NSWLR 424. I have been told by the Council's counsel that finalisation of the sale contracts is intended to be on 20 October 2015. This circumstance answers the Council's submission that no irreparable injury will be caused to the Applicant's case if no injunction is continued. 3. As identified in Tegra at [19] enforcement of the planning law and the orderly development and use of the environment are relevant factors to consider in the exercise of the Court's discretion, citing Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335 inter alia. 4. No harm to the physical environment is identified by the Applicant, a fact relied on by the Council. No undertaking as to damages has been offered. The Council submitted that the status quo favours that the long standing process of making the LEP Amendment to enable the sale of the land owned by the Council to continue. Delay 1. The Applicant has commenced these proceedings challenging the making of the LEP Amendment just within the three months specified by s 35 of the EPA Act. It accepts that proceedings could have been commenced by it any time after 10 July 2015 when the LEP Amendment was gazetted but relies on the circumstance that its solicitor was making requests for information of the Council and the Department as identified in the letters dated 17 August 2015 in Exhibit A as reasonably explaining its commencement of proceedings on 9 October 2015. Given that the substantive proceedings have been commenced within the statutory time period, no particular criticism can be made of the Applicant in that regard. Answers to GIPA requests, including the instrument of delegation relating to Mr Ray's position, were received from the Department by cover letter dated 17 September 2015. Responses addressing the Applicant's request in part were received from the Council in August and in September 2015. 2. The Council submitted that proceedings could have been commenced much earlier as the Gateway determination on which the invalidity argument is based was signed and publicly available in November 2014. The instrument of delegation of Ministerial powers and the Administrative Arrangements Order 2014 are all publicly available documents which could have been identified by the Applicant's solicitor much earlier. The Applicant sat on its hands during the exhibition process for the LEP Amendment and has waited until the last minute to commence these proceedings. I am not sure it is readily open to anyone to challenge a Gateway determination before the conclusion of the statutory process of which it forms a part. Until the gazettal of the LEP Amendment the land was classified as community land and could not be sold. 3. The real issue in these interlocutory proceedings is whether there was unreasonable and therefore disentitling delay by the Applicant in seeking an interlocutory injunction to restrain the sale of the land. Contracts for the sale of the eleven lots were entered into by the Council on 10 September 2015. The Applicant submits it was not aware that the Council had entered into sales contracts for the land until after the contracts were entered into by the Council on 10 September 2015. Ms Mangleson's affidavit does not identify precisely when she became aware that contracts for sale had been exchanged but affirms that it was after the event. I do not consider there is disentitling delay in these circumstances. Public interest 1. The Council submitted that the Applicant simply asserts that it is acting in the public interest with no evidence to support what that might be. The Applicant read the affidavit of Ms Mangleson who states that the Applicant is acting in the public interest. The affidavit evidence is prepared on a preliminary basis given that proceedings were commenced only recently. The affidavit states that the Applicant has a long history of involvement in preserving the land. This evidence is limited in establishing public interest and generally more is required. That there is community interest in the fate of the land can be inferred from the responses received by the Council during the exhibition of the draft LEP amendment early in 2015. The responses were summarised in the council report dated 21 May 2015 as comprising 176 written and 26 oral submissions, the majority of which did not support reclassification of the land from "community" to "operational". 2. A history of the land contained in an earlier judgment of Donald Mark Cochrane v The Council of the Shire of Byron [1993] NSWLEC 26 read by the Council identifies part of the history of the site and how it came to be bought by the Council. It provides some information relevant to the significance of retaining the land in the Council's hands. The exhibit to the affidavit of Mr Woolf solicitor includes correspondence between Woolf Associates and the Council and its solicitor at tabs 1 to 5 in relation to whether the land could be sold at auction in early 2014 as it was not properly categorised as operational land at that time. The Council did not proceed with an intended auction on 1 March 2014. Mr Woolf attests that the Applicant has been concerned with the preservation of the land since 2008. The Applicant's counsel relies on Tegra at [54] and [55] where the importance of upholding the planning and environment laws is recognised as a relevant consideration in the exercise of the Court's discretion. I am satisfied given all the evidence before me that the proceedings have been brought in the public interest. Impact on third parties 1. Of concern are the incoming purchasers of the eleven lots who will be affected if the injunction continues as the sales will not be able to be completed by the Council by 20 October 2015. The impact on the contracts for sale is presently unknown and there has not been time to provide an opportunity to the purchasers whether directly to the Court or through the Council to advise the Court of any impact. I infer that it is very likely that the failure to complete will cause inconvenience. Undertaking as to damages 1. The Applicant has not offered an undertaking as to damages and I am not aware of its financial position were I to require one. I do not therefore know if any undertaking could be satisfied. 2. Under r 4.2(3) of the Land and Environment Court Rules 2007 (NSW) the Court may decide not to make an order requiring an applicant to give any undertaking as to damages in relation to the injunction or order sought by the applicant it is satisfied that the proceedings have been brought in the public interest. I have concluded above that I am satisfied the proceedings have been brought in the public interest. Conclusion 1. Considering all these factors in a finely balanced exercise I conclude that I will continue the interlocutory injunction made on 12 October 2015. 2. Expedition of the proceedings is warranted as the Council sought in the event that the injunction continues given the potential for impact on several third parties. The matter in issue is a single discrete point and will require a one day hearing at most. I anticipate that an early hearing date in the week commencing 19 October 2015 can be found. Order 1. Expedition granted. 2. Costs reserved. ********** 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: 15 October 2015