In the Zone - July 2024 Update

This quarter, In the Zone includes key decisions of the High Court on jurisdictional errors, the Court of Appeal on the standing of an incorporated association in civil enforcement proceedings, and the Land and Environment Court on the ‘substantially the same development’ test, Planning for Bushfire Protection 2019 and the time limit on commencement of prosecution proceedings.

There have also been some recent legislative amendments, with the introduction of the controversial Transport Oriented Development SEPP and amendments to the Protection of the Environment Operations Act 1997 to increase penalties for environmental offences and powers of the Environment Protection Authority.

These decisions and legislative changes combined with other industry activity, such as the Parliamentary Inquiry into “Zombie Developments” reflect significant developments in NSW Planning and Environmental Law. We trust our ongoing commentary will assist our clients to stay informed about the evolving legal framework in this field.

High Court

High Court delivers practical guidance on jurisdictional error and materiality in unanimous decision

LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12 (10 April 2024). Access the case here.

In this unanimous decision, a full bench of the High Court held that a Tribunal had committed jurisdictional error by failing to properly undertake the relevant evaluative exercise required by the Migration Act 1958 (and subsequent ‘Direction 90’ given by the Minister).  The error was found to be material because ‘the evaluative conclusion reached by the Tribunal in the exercise of the discretion under s 501CA(4) could have been different if there had been no error’ (at [35]). In doing so, the High Court has provided practical guidance concerning jurisdictional error and the requirements of materiality, which is likely to have application to other jurisdictions where jurisdictional error is alleged, including the Land & Environment Court. We encourage readers to read that guidance directly here.

Land and Environment Court

Chief Judge provides further guidance on the “substantially the same” test

Canterbury-Bankstown Council v Realize Architecture Pty Ltd [2024] NSWLEC 31 (4 April 2024) by Preston CJ. Access the case here.

On 4 April 2024, Preston CJ handed down his decision in Canterbury-Bankstown Council v Realize Architecture Pty Ltd [2024] NSWLEC 31 (Realize Architecture), in which, the “substantially the same” test under s 4.55(2)(a) of the Environmental Planning & Assessment Act 1979 (EPA Act) has been simplified.

This case involved an appeal against a Commissioner’s decision to approve the proposed modification of a development consent for a high-density residential development in Canterbury: Realize Architecture Pty Ltd v Canterbury-Bankstown Council [2023] NSWLEC 1437 (Original Decision).

In the Original Decision, the Commissioner found that she was satisfied that the development as modified was substantially the same as the originally approved development. The Commissioner considered evidence about quantitative and qualitative differences “to assist in ultimately undertaking a comparison of the two developments” required by s 4.55(2) of the EPA Act. In her assessment of qualitative differences, the Commissioner found that the proposed modification did not seek to delete or modify any critical element of the development.

The Council contended that several errors led the Commissioner to err in law in finding that the developments (proposed to be modified and as originally granted) were “substantially the same”.

Preston CJ held on appeal that no error of law had been established and the appeal was dismissed with costs. 

His Honour held that under s 4.55(2)(a) of the EPA Act, a consent authority was required to undertake the following three tasks:

1. Find the primary facts, which requires identifying the differences between the two developments, including qualitative and quantitative differences.
2. Interpret the law, which requires interpreting the words and phrases in section 4.55(2)(a).
3. Categorise the facts found, which is the evaluative task of assigning relevant significance or weight to the primary facts found in the first task, and balancing those facts, as weighted.

Preston CJ stated at [29] that the primary facts alone are uninformative of whether the two developments are substantially the same. The precondition in section 4.55(2)(a) is only answerable by undertaking the third task, which “can be an instinctive synthesis and need not be articulated expressly” (at [30]).

His Honour summarised the required approach to the ‘substantially the same development test’ as follows at [26] (our emphasis added):

The test in s 4.55(2)(a) requires a simple comparison of the two developments, the development as modified and the development as originally approved: Arrage v Inner West Council [2019] NSWLEC 85 at [24]; Feldkirchen Pty Ltd v Development Implementation Pty Ltd (2022) 254 LGERA 114; [2022] NSWCA 227 at [112]. This comparison can involve “an appreciation, qualitative, as well as quantitative, of the developments being compared in their proper context”: Moto Projects (No 2) Pty Ltd v North Sydney Council (1999) 106 LGERA 298; [1999] NSWLEC 280 at [56]. But the comparison required by s 4.55(2)(a) remains a holistic one of the two developments being compared – the modified development and the originally approved development. The opinion of satisfaction that s 4.55(2)(a) requires is that the two developments being compared are substantially the same development, not that either the quantitative features or the qualitative features of the two developments are substantially the same.

Following the above, Preston CJ found that while an assessment of the differences between the quantitative and qualitative features of the two elements can be undertaken, that assessment cannot displace the test in s 4.55(2)(a): at [27].

In practical terms, the decision in Realize Architecture confirms that the precondition in s 4.55(2)(a) requires the consent authority to:

1. identify all differences between the two developments, and
2. attribute significance to those differences, and
3. balance the differences having regard to their significance, in order to holistically determine whether the two developments are substantially the same.

Chief Judge clarifies the requirements for establishing Asset Protection Zones in compliance with Planning for Bushfire Protection 2019

Shoalhaven City Council v Easter Developments Pty Limited [2024] NSWLEC 49 (16 May 2024) by Preston CJ. Access the case here.

The Chief Judge has overturned the decision of a Commissioner who determined to grant consent to a development application (DA) that proposed part of an Asset Protection Zone (APZ) on adjoining Council community land. The DA sought subdivision of land in Vincentia on bushfire-prone land and was integrated development under s 4.46 of the EPA Act. The issues were whether the APZ proposed on adjoining Council land complied with the requirement in Planning for Bush Fire Protection 2019 (PBP) that the land be “managed in perpetuity” and whether the need “to ensure ongoing compliance with the APZ requirements” had been satisfied.

The Commissioner considered that the relevant question for determination was whether the land over which the APZ was proposed was ‘managed land’ pursuant to the Rural Fires Act 1997. Preston CJ clarified the requirements of PBP at [37] as follows:

In summary, the PBP sets a performance criterion that the APZ is provided in perpetuity; the accepted solution to achieve this performance criterion is that the APZ is wholly within the boundaries of the development site; an alternative solution to achieve this performance criterion for an APZ on privately owned, adjoining land is having an easement under s 88B of the Conveyancing Act guaranteeing that the land will be managed in perpetuity; and a further alternative solution to achieve this performance criterion for an APZ on publicly owned, adjoining land is having an adopted Plan of Management that provides the assurance that the APZ will be managed in perpetuity.

Accordingly, His Honour held that the Commissioner failed to ask the right question and misdirected herself regarding the requirements of PBP.

Further, His Honour held that the Commissioner’s finding that the Generic Community Land Plan of Management, which was applicable to all of Council’s community land, including the adjoining land, was sufficient for the purposes of PBP, involved misdirection because it did not:

• contain an “assurance that an APZ will be managed in perpetuity”,
• demonstrate that a “management regime [was] in place to ensure ongoing compliance with APZ requirements”, or
• contain the five requirements of section 3.2.6 of the PBP including “an acknowledgement of responsibility from the adjoining land holder [the Council] that the APZ will be managed in perpetuity”.

Preston CJ explained the intent of PBP at [47] as follows:

The bush fire protection measures in the PBP, including the provision of APZs, are forward-looking. The measures are intended to protect the proposed development for the lifetime of the development. Hence, it matters not whether the APZ that is proposed to provide bush fire protection for a development is an existing APZ or a new APZ, either way the APZ must be managed in perpetuity…

It follows that an APZ proposed on lands belonging to a Council or other entity will not be acceptable unless there is a guaranteed commitment to future management in accordance with PBP requirements.

Court of Appeal overturns decision on standing finding that an incorporated community association demonstrated a ‘special interest’ in the subject matter  

South East Forest Rescue Inc v Forestry Corporation of New South Wales (No 2) [2024] NSWCA 113 (16 May 2024) by Adamson JA, Basten AJA and Griffiths AJA. Access the case here.

South East Forest Rescue Incorporated (the Appellant), appealed from a decision of the primary judge in the Land and Environment Court in which it was found to lack standing. In those proceedings, the Appellant sought to restrain the respondent from conducting forestry operations in several State forests unless certain steps were taken to prevent or minimise the effects of the logging on three threatened species of Glider. The respondent undertook the logging in accordance with an integrated forestry operations approval granted under section 69M of the Forestry Act 2012 (NSW) (Forestry Act).

One of the key questions on appeal was whether the primary judge erred in concluding that the Appellant lacked standing to bring civil enforcement proceedings against the respondent. In considering the question, Griffiths AJA clarified that the sufficiency of particular steps or activities that can demonstrate a ‘special interest’ will depend on the subject matter of the proceeding and are fact and context specific (at [131]). His Honour found that to establish a ‘special interest’ in the subject matter, an applicant must demonstrate that (summarised at [176]):

1. its interest is more than a mere intellectual or emotional concern for the preservation of the environment,
2. its interest goes beyond that of members of the public generally in upholding the law,
3. its interest involves more than genuinely held convictions, and
4. it has taken sufficient active and concrete steps to give effect to its interest and concerns.

Griffiths AJA held that the Appellant had standing for the following reasons:

• The vision statement, and ‘objects and purposes’ of the Appellant’s application for incorporation demonstrated a sufficient connection to the subject matter of the proceedings.
• The evidence indicated that the Appellant had taken a wide range of activities and concrete steps which give effect to the Appellant’s beliefs and concerns regarding environmental protection. In particular, the Appellant had filed over 36 breach reports over a 20-year period complaining of unlawful forestry operations, and produced 38 reports, submissions and representations to various government bodies over a 14-year period, seeking to influence government to protect and preserve native forests.
• The Appellant’s interest and concern to protect the Greater Glider was not a new interest and had been raised by the Appellant in multiple submissions and representations made in the last 14-year period.
• More recently, the Appellant has conducted surveys for certain Glider den trees in various State forests.
• Evidence of the Appellant’s media presence and their action in bringing judicial review litigation on three previous occasions to protect NSW native forests from logging or mining supported its claim for standing.

The Court of Appeal also considered whether the Appellant’s common law standing had been ousted by the relevant statutory scheme, in particular ss 69SB and 69ZA of the Forestry Act and ss 13.14 and 13.14A of the Biodiversity Conservation Act 2016. It was held that none of the provisions expressly negated the Appellant’s rights at common law, and that (relying on the principle of legality) “much clearer language than that which appears in the provisions relied upon by the respondent is required to oust well established common law standing” (at [116]).

The appeal was unanimously allowed with costs.

Land and Environment Court finds that proceedings were commenced within 3-year limitation period, despite authorised officers suspecting offence was being committed 12 years earlier

Natural Resources Access Regulator v Littore [2024] NSWLEC 53 (17 May 2024) by Pepper J. Access the case here.

The Land and Environment Court recently considered whether proceedings commenced by the Natural Resources Access Regulator (NRAR) were statute barred. On 27 October 2022, NRAR filed four summonses alleging the defendant committed offences under the Water Management Act 2000 (WM Act) by taking more water than was allocated under the relevant Water Access Licences.

The defendant occupied a large property used as a vineyard (approximately 6,800 hectares in size) in Wentworth NSW, and was co-director of the company that managed the property. Grapes grown on the property were irrigated using water from the Darling River under two Water Access Licences. Until 2007, three river pumps and two 450mm main pipes were used to access water to irrigate the property. By 14 October 2010, the defendant had installed two additional pumps and another 450mm underground main pipe to irrigate the property, which included a gate valve. NRAR was unaware of the existence of the third main pipe when it was installed.

NRAR alleged that the defendant took unmetered water from the Darling River between 1 July 2011 and 30 June 2015. NRAR first suspected that the defendant was taking water unlawfully around 2010, however, the existence of the third main pipe was only confirmed in 2019 after the property was sold and the new owner made enquiries about installing another main pipe, only to be informed by a former employee of the defendant that there was “already a third mainline installed... that you aren’t aware of.” On 31 October 2019, an employee of the new owner informed an authorised officer of the WM Act that the third main pipe had been discovered.

Section 364(3) of the WM Act provides that proceedings for an offence against that Act “may be commenced any time within, but not later than, 3 years after the date on which evidence of the alleged offence first came to the attention of any relevant authorised officer.” The defendant claimed that NRAR was aware of the third main pipe and that water was being taken contrary to the applicable Water Access Licences as early as 2010, and the proceedings should be struck out because they are statute barred.

The Court emphasised that the test of “whether or not there was evidence that ‘first came to the attention of an authorised officer’” was objective. The Court found that the “evidence” must indicate that an offence had been committed and does not include the mere suspicion and belief of an authorised officer. The Court considered the elements of the offence alleged and held that NRAR did not have the required ‘evidence’ until 31 October 2019, when an officer was informed of the third main pipe which, together with previous evidence collected, addressed the elements of the offence – prior to that, NRAR had only suspected an offence was being committed. The Court highlighted that the onus was on the defendant to prove the proceedings were statute barred, which he failed to do. The Court held that the proceedings were commenced in time.

This quarter has seen the following legislative amendments introduced/passed.

Transport Oriented Development

On 29 April 2024 the NSW Government released the Transport Oriented Development (TOD) State Environmental Planning Policy (TOD SEPP).  According to the Department’s website:

Over the next 15 years, this part of the TOD policy is estimated to deliver more than 170,000 new homes in mid-rise dwellings with new affordable homes, and apartment buildings that contain commercial space to create vibrant communities close to transport, services and jobs.

The TOD SEPP has been inserted into Chapter 5 of the State Environmental Planning Policy (Housing) 2021 and commenced operation on 13 May 2024. In particular, the TOD SEPP amendments:

• have initial application to land in the vicinity of 18 railway stations in 8 local government areas, including stations in the Newcastle, Lake Macquarie, Central Coast and Wollongong local government areas (the provisions will eventually expand their application to other areas, with the Department’s website stating that the “majority of the sites will be in effect by December 2024”)
• apply to mapped ‘Transport Oriented Development Areas‘ (TOD Areas)
• increase the density of housing in TOD Areas by permitting development in certain zones for the purposes of “residential flat buildings” (up to a height of 22 metres and FSR of 2.5:1) and “shop top housing” (up to a height of 24 metres and FSR of 2.5:1)
• include a mandatory affordable housing contribution (2% of the gross floor area which is to be delivered onsite and managed by a registered community housing provider in perpetuity), and
• contain saving and transitional provisions, including the exclusion of the application of the TOD SEPP provisions to development applications made (but not determined) on or before 13 May 2024.  The TOD SEPP will also not apply to a modification application that is lodged after 13 May 2024, it if seeks to modify a development consent granted on or before 13 May 2023.

The TOD SEPP is not without controversy however, and the Hon. Scott Farlow has since introduced the Environmental Planning and Assessment Amendment (Disallowance of Transport Oriented Development SEPP) Bill 2024, which seeks to amend the Environmental Planning and Assessment Act 1979 to enable the TOD SEPP to be disallowed by Parliament. The status of that Bill can be tracked here.

Environmental Protection Legislation

Environment Protection Legislation Amendment (Stronger Regulation and Penalties) Act 2024 (the Act) – The Act, which has now fully commenced, makes a range of changes to environmental laws aimed at increasing penalties for environmental offences and powers of the NSW EPA.  In particular, the Act has introduced:

• an increase in the maximum penalties for many offences under the Protection of the Environment Operations Act 1997, including the introduction of a maximum penalty of $10 million for corporations and $2 million for individuals for the most serious ‘Tier 1’ offences
• an increase in penalty notice fines for repeat offences
• new powers for the EPA including to take action on climate change and issue “public warning statements” about poor environmental performers, and
• a new power for the Land and Environment Court to ban persons from holding an environmental protection licence.

The Act contains a range of savings and transitional provisions, including a provision which has the effect of ensuring that new powers and offences apply to circumstances that arise prior to commencement of the Act. View the Act in full here.

Nature Positive Plan

The Commonwealth Government has introduced several bills as part of its “Nature Positive Plan”. In particular, the Nature Positive (Environment Protection Australia) Bill 2024 will establish a statutory Commonwealth entity known as ‘Environment Protection Australia’ and the Nature Positive (Environment Information Australia) Bill 2024 will establish the statutory position of the ‘Head of Environment Information Australia’ to improve environmental reporting. We will continue to track their progression through Parliament.

• The NSW Government is partnering with Councils to trial AI assisted technologies with the aim of speeding up development assessment timeframes. Read more about the trial here.

• An inquiry into ‘Zombie Developments’ was announced by the NSW Legislative Assembly Committee on 19 March 2024. The inquiry will examine the impact of historical development consents on the NSW planning system, development industry and property ownership and will consider policy and legal solutions to address concerns about so called ‘Zombie Developments’. View the full terms of reference and track the inquiry here.

• Accelerated rezoning proposals for social and affordable housing from NSW State housing agencies will be managed by a newly established department within DPHI to deliver faster approvals. Read more here.

• In March 2024, the NSW Minister for the Environment released the report of the 5-year review of the Biodiversity Assessment Method (BAM). The review found that, overall, the BAM was working as intended, however, it contains 32 recommendations to improve the method’s efficiency and effectiveness. The NSW Department of Climate Change, Energy, the Environment and Water will now consider this review in conjunction with the review into the Biodiversity Conservation Act 2016 (BC Act) (which was tabled in Parliament in August 2023), and will undertake further public consultation before making any changes to the BAM. The review of the BAM can be downloaded here (and the review of the BC Act can be considered here).