Fencott Drive Pty Ltd v Lake Macquarie City Council [2000] NSWLEC 146

Reported Decision : 110 LGERA 318

Land and Environment Court of New South Wales

CITATION : Fencott Drive Pty Ltd v Lake Macquarie City Council [2000] NSWLEC 146 APPLICANT: Fencott Drive Pty Ltd PARTIES : RESPONDENT: Lake Macquarie City Council FILE NUMBER(S) : 10871 of 1999 CORAM: Bignold J KEY ISSUES: Question of Law :- (i) is development site an "existing holding" in terms of LEP (ii) is provision of LEP a development standard LEGISLATION CITED: State Environmental Planning Policy No 1 Bell v Shellharbour Municipal Council (1993) 78 LGERA 419; Christies Sands Pty Ltd v City of Tea Tree Gully (1975) 37 LGRA 325; Dixson v Wingecarribee Shire Council (1999) 103 LGERA 103; CASES CITED: Kruf v Warringah Shire Council (unreported LEC 25 December 1988 per Holland J); Ku-Ring-Gai Municipal Council v Kuttner (1980) 41 LGRA 1; North Sydney Municipal Council v P D Mayoh Pty Limited (No 2) (1990) 71 LGRA 222; Pancho Properties Pty Ltd v Wingecarribee Shire Council per Talbot J; [1999] NSWLEC 245; Rusell v Brisbane City Council (1955) St R Qd 419; DATES OF HEARING: 27/04/00 DATE OF JUDGMENT: 07/12/2000

APPLICANT: Mr W R Davison SC with Mr D Parry SOLICITORS Mr P Hines

LEGAL REPRESENTATIVES: RESPONDENT: Mr B Preston SC SOLICITORS: Mr P Rees

JUDGMENT: IN THE LAND AND Matter No . 10871 of 1999 ENVIRONMENT COURT OF Coram : Bignold J. NEW SOUTH WALES 12 July 2000

FENCOTT DRIVE PTY LIMITED

Applicant

v

LAKE MACQUARIE CITY COUNCIL

Respondent

JUDGMENT ON PRELIMINARY QUESTIONS OF LAW

Bignold J:

A. INTRODUCTION

1. Each party has raised a preliminary question of law in pending class 1 proceedings being an appeal by the Applicant pursuant to the Environmental Planning and Assessment Act 1979 s 97 (EP&A Act) against the Council's deemed refusal of a development application for the erection of a dwelling-house on land known as lot 100 DP 737463, comprising an area of 31 ha and situate at Fencott Drive Belmont North (the development site).

2. The question of law raised by the Applicant is whether the development site is "the whole of an existing holding within the meaning of cl 13(1) of the Lake Macquarie Environmental Plan 1984" (the LEP).

3. The question of law raised by the Council is whether cl 13(2) or cl 13(3) of the LEP is relevantly a "development standard" within the meaning of the EP&A Act that is amenable to the dispensational power conferred by State Environmental Planning Policy No 1 — Development Standards (SEPP No 1).

4. It is to be noted that each question is concerned with a provision contained in cl 13 of the LEP. That clause which is contained in Part III (Special Provisions) of the LEP and which is headed "Dwelling-house in Zone No 1 (a), 1(b), 1(c) or 7(a)" provides as follows: 13. (1) In this clause existing holding means - (a) except as provided by paragraph (b), a lot, portion or parcel of land as it was on 21 August, 1981; or (b) where, on 21st August, 1981, a person owned 2 or more adjoining or adjacent lots, portions or parcels of land, the aggregation of those lots, portions or parcels as they were on that date. (2) A person shall not erect a dwelling-house on an allotment of land within Zone No. 1(a), 1(b), 1(c), 7(a) or 7(d) unless the allotment - (a) has an area of not less than - (i) in the case of land within Zone No. 1(a), 1(b) or 7(a) - 40 hectares; or (ii) in the case of land within Zone No. 1(c) - 1 hectare; or (iii) in the case of land within Zone No. 7(d) - 20 hectares; or (b) includes the whole of an existing holding. (3) A person may, but only with the consent of the Council, erect a dwelling-house: (a) on an allotment of land within zone No. 1(a), 1(b) or 7(a) having an area of not less than 40 hectares; or (b) on an allotment of land within Zone No. 1(c) having an area of not less than 1 hectare; or (c) on an existing holding within zone No. 1(a), 1(b) or 7(a); or (d) on an allotment of land within zone No. 7(d) having an area less than 20 hectares. (4) The Council must not grant a consent pursuant to this clause that will result in more than 1 dwelling-house on the same allotment or existing holding.

5. Part II of the LEP which is headed "General Restrictions on Development" contains only one clause (cl 10) which relevantly provides as follows: 10. Except as otherwise provided by this plan, the purposes for which (a) development may be carried out without development consent; (b) development may be carried out only with development consent; and (c) development is prohibited. In each of the zones specified in Column 1 of the Table to this clause are respectively shown on the next page thereto in columns II, III and IV of that Table.

6. The Zoning Table includes the following matter in respect of Zone No 1(a) Rural A (in which zone the development site is included): Column II Column III Column IV Advertising structures; advertisements; automotive uses; brothels, bulk stores; commercial premises (other than home offices) dual occupancy - detached; funeral parlours: generating works; industries (other than rural industries and home industries); junk yards; liquid fuel depots; motor showrooms; residential flat buildings; shops; transport terminals; warehouse Agriculture (other than pig breeding establishments or poultry farming establishments) Any purpose other than those included in column II or IV.

7. It is common ground that the Applicant's proposed development of the development site is for the purpose of a " dwelling house " which is a term defined by cl 7(1) of the LEP as follows:

dwelling house means a building containing one but not more than one dwelling, but does not include a detached dwelling resulting from dual occupancy development.

8. It is also common ground that the purpose of a " dwelling-house " is a purpose that falls within the scope and operation of Column III of the Zone Table to cl 10— ie it is a purpose of development that may be carried out only with development consent.

B. THE RELEVANT FACTS

9. The parties have submitted a Statement of Agreed Facts (Exhibit 1) which establishes the following facts: 1. Lot 100 DP 737463 Fencott Drive, Belmont North (the land) in the City of Lake Macquarie is owned by the Applicant. 2. The land has an area of 31.19 ha. 3. On 18 February, 1999 the Applicant made a development application to the Respondent to erect a dwelling-house on the land. 4. The Lake Macquarie Local Environmental Plan, 1984 (the plan) applies to the land. 5. The land is within zone 1.RURAL(a) Rural A under the provisions of the plan. 6. The Respondent is the consent authority for the purposes of the plan and the determination of the development application. 7. There is no dwelling-house on the land.

10. However, this statement does not include all relevant facts. Other undisputed facts need to be noted, namely:- 8. Deposited Plan 248860 creating five lots (lot 1 of which includes the development site in a larger area of 43.39 ha) was registered by the Registrar General on 17 December 1974, having been earlier approved by the Council as a subdivision. 9. Deposited Plan 737463, creating two lots — lot 100 (the development site) and lot 101, containing an area of 11.19 ha designated as a public reserve — was registered by the Registrar General on 24 October 1986, having been earlier approved by the Council as a subdivision. 10. By Deed dated 25 June 1986, the then owner of lot 1 in Deposited Plan 248860 (which includes the development site) executed a Deed agreeing to dedicate to the Council as a public reserve that portion of lot 1 that was later to become lot 101 in Deposited Plan 737463.

11. There are yet further relevant facts which the Applicant has sought to establish. However, these facts are in dispute and it will be necessary to consider the evidence (which was entirely documentary, but unfortunately is obviously fragmentary rather than complete).

12. The fragmentary documentary evidence (Exhibit 2) is sourced in documents produced to the Court in response to the subpoena issued at the request of the Applicant addressed to the Broken Hill Proprietary Company Limited (the predecessor in title of lot 1 in Deposited Plan 248860). That subpoena called for documents in respect of the subdivision creating lots 1, 2 and 3 in Deposited Plan 248860, together with documents in respect of "any agreements with Lake Macquarie Council or Scenarama Estates Pty Ltd in respect of the land".

13. The documentary evidence includes a letter written by BHP to the Council dated 24 June 1983 in respect of "the exchange of lands between The Broken Hill Proprietary Company Limited, Scenarama Estates Pty Ltd and the Council in respect of lots 1, 2 and 3 Deposited Plan 248860 Belmont North".

14. The letter refers to the completion in 1975 of an "exchange agreement" between the three entities, (which I take to be a reference to the registration of Deposited Plan 248860, together with the registration of the related conveyancing transactions involving the three parties). Apparently the land exchange agreement was entered into in 1973. However, the evidence does not include that Agreement. (Nor does it include the relevant contracts for sale). However, the letter included a plan "showing in outline what appears to be the original intention".

15. The letter includes the following content:

……

It has been discovered that the title to Lot 1 transferred to our Company relates to a total of 42.39 hectares, instead of an area of about 26.2 hectares, which it appears, the Company was intended to acquire under the contracts entered into, in order to effect the arrangement between the three parties.

…..

A copy of Certificates of Title Volume 12685 Folios 113 and 115 are enclosed for comparison. It seems that the Deposited Plan 248860 as finally registered included within Lot 1 a part of the land to the east which should have been included within Lot 3 in that Plan transferred by Scenarama Estates Pty. Limited to your Council.

We would be glad of your investigation of this mater and if you are in agreement, then it appears that Council may wish to effect the transfer to it of the additional area as originally intended. We believe this transfer should be without expense to the Company and that equitably, an appropriate refund by Council of the relevant proportion of rates paid by the Company over the period should be considered. We will however, await your further advice.

16. On 22 September 1983, the Council responded to BHP's letter on the following terms:

Further to previous correspondence in this matter, I enclose herewith a sketch plan showing the area of approximately 16.2 ha proposed to be transferred from your Company to Council.

It would be appreciated if you could confirm that this plan represents your understanding of the situation. It is proposed, upon receipt of your confirming advice, to prepare a linen plan of survey for the transfer of the subject land to Council on the basis that the transfer is free of compensation with Council to meet all scale legal and survey fees associated with the transaction.

The fact that your Company has brought this matter to Council's attention is much appreciated.

17. Thereafter, correspondence ensued between the Council's Solicitors and BHP's Solicitors, including the preparation of a Deed for the dedication to the Council as a public reserve of a portion of the land then comprising lot 1 in Deposited Plan 248860.

18. In the earlier versions of the draft Deed, the area of the proposed public reserve is shown as 16.2 ha. Ultimately, the area dedicated to the Council as a public reserve was 11.19 ha: vide lot 101 in Deposited Plan 737463.

19. The explanation for the discrepancy in the area of the proposed public reserve is provided in the following extract from the memorandum dated 8 August 1985 from the General Operations Manager for BHP to the Company's Solicitor.

We refer to your memo of 11th June, 1985 and advise as follows: 1. The plan of subdivision does not appear to agree with the plan attached to the original contract for sale, nor does it entirely agree with the intention of the agreement. We have had some difficulty in obtaining records but have had discussions with Council's surveyors. The plan will have to be revised and in this regard we will liaise directly with Council.

20. It appears that the contemplated liaison between the Company's and the Council's Surveyors duly ensued resulting in an acceptance of the dimensions of the proposed public reserve lot that are reflected in Deposited Plan 737463 prepared by the Council's Surveyor Mr V Kepreotis. Endorsed upon a working plan apparently submitted to Mr V Kepreotis on 13 August 1985, there is a note (which I infer to have been prepared by the Company's Surveyor) which states:

Our guess of the dimensions shown on the plan attached to the contract for sale

21. The Applicant invites me to draw the following inferences from the fragmentary documentary evidence (noting that the Council has responded to the Notice to Produce served by the Applicant calling for relevant Council documents by saying " No documents are produced ")— (i.) the land exchange agreement entered into in 1973 by BHP, Scenarama Estates and the Council contemplated the creation of a dedicated public reserve to be vested in the Council not only the land shown as lot 3 in Deposited Plan 248860, but also adjoining land situate immediately south of that lot being an ascertainable portion of the land shown as lot 1 in that Deposited Plan; (ii.) the registration in 1975 of Deposited Plan 248860 (and the registration of the related conveyancing transactions) failed to give effect to that common intention in that instead of creating a public reserve vested in the Council in respect of the easternmost section of the lot, Scenarama Estates transferred the whole of its land forming part of lot 1 in that Deposited Plan to BHP instead of only part of that land; (iii.) by virtue of the failure of the 1975 transactions to designate the relevant public reserve land and to vest it in the Council, BHP held the relevant land (being part of lot 1 shown in Deposited Plan 248860) upon trust for the Council from the time that the relevant lot was mistakenly transferred to it, until it was ultimately transferred to the Council as public reserve in October 1986; (iv.) while BHP held that land upon constructive trust for the Council, it was an ascertainable entity (ultimately emerging as lot 101 in Deposited Plan 737463 comprising an area of 11.19 ha ) and as such constituted a separate " parcel of land " albeit being included in the larger area of 43.39 ha that comprised lot 1 in Deposited Plan 248860.

22. The Council submits that the available evidence does not support the drawing of such inferences. In particular, it points out that in the Deed executed by BHP in June 1986 whereby it agreed to transfer that part of lot 1 in Deposited Plan 248860 which was to become lot 101 in Deposited Plan 73, there is nothing contained within the recitals that indicates the existence of (i) an obligation founded upon the 1973 land exchange agreement; (ii) an unintended failure to give effect to that obligation in the conveyancing transactions that occurred in 1975; and (iii) an agreement to rectify the past conveyancing mistake. Rather, the recitals of the Deed merely note a desire by the Council that the land be vested in it as a public reserve and an agreement by BHP that the land be so divested from itself (for the nominal consideration of $1).

23. However, it is to be noted there is nothing in the recitals to the Deed that is inconsistent with the factual matrix advanced by the Applicant on the basis of the fragmentary documentary evidence.

24. Another factor that may explain the absence of recitals stating the factual position as now advanced by the Applicant is the fact that it was Scenarama Estates that owned the relevant portion of land which, according to the 1973 agreement, was to be transferred in part to BHP and in part to the Council but Scenarama was not a party to the 1986 Deed.

25. Despite the difficulties posed by the fragmentary relevant documentary material, I am prepared to find on the balance of probabilities that when lot 1 in Deposited Plan 248860 was created in 1975 and was vested in BHP by the appropriate conveyancing transactions that that lot contained a portion of land that the parties to the tripartite land exchange agreement made in 1973 had intended should be vested in the Council as a dedicated public reserve. I am also prepared to find that from the moment of that vesting in BHP, it held the land subject to some kind of constructive obligation or trust in favour of the Council as the rightful repository of the land as a dedicated public reserve and that this legal position ensued until October 1986 when lot 101 in Deposited Plan 737463 was vested in the Council as a public reserve upon registration of that plan.

26. Finally, I am prepared to find that the portion of lot 1 in Deposited Plan 238860 that was subject to the constructive trust or obligation was ascertainable in the sense that it was capable of being precisely defined in the manner that lot 101 in Deposited Plan 737463 was ultimately defined or by some similar or alternative process (eg had it become necessary that the question of rectification be litigated, by an appropriate order of the court adjudicating upon the matter).

27. A final fact that emerges as a consequence of these findings is that the land comprising lot 1 in Deposited Plan 238860 not only comprised an ascertainable parcel of land (that ultimately was ascertained as lot 101 in Deposited Plan 737463) but it also comprised as a separate parcel the residue of lot 1 which was ultimately to become lot 100 in Deposited Plan 737463.

28. The two questions of law are to be determined in the light of all the foregoing facts (being either facts as agreed or facts as found). I shall consider the questions separately.

C. IS THE DEVELOPMENT SITE THE WHOLE OF AN EXISTING HOLDING?

29. In contending that the development site is relevantly "an existing holding" within the meaning of cl 13(1) of the LEP, the Applicant submits that it was relevantly a "parcel of land as it was on 21 August 1981" because it was at that time an ascertainable part of lot 1 in Deposited Plan 238860 (the ascertainment in 1986 of its precise existence as lot 100 in Deposited Plan 737463 demonstrating that it was so ascertainable) and as such, constituted a parcel of land, albeit at that time comprising only part of that lot 1.

30. In so contending, the Applicant, relying upon Ku-Ring-Gai Municipal Council v Kuttner (1980) 41 LGRA1; Christies Sands Pty Ltd v City of Tea Tree Gully (1975) 37 LGRA 325; and Rusell v Brisbane City Council (1955) St R Qd 419 submits that the expression "parcel of land" within the definition of "existing holding" should be interpreted as meaning:

an identified area of land, as in the time-worn expression all that piece or parcel of land : per Hope JA in Kuttner at 3

a specified and reasonably well defined area of land…..defined by general description, by reference to a map or plan, by a clearly established usage, or by a combination of all three (or one or two of them): per Wells J in Christies Sands at 336

a piece of land that can be distinguished from adjoining pieces or areas….: per Macrossan CJ in Russell at 435.

31. Assuming the correctness of the premise of the Applicant's argument that it is legally and factually possible for a parcel of land to be included within the area of an existing lot or portion, nonetheless in my judgment the Applicant's contention fails because as at the relevant date (21 August 1981) the suggested parcel " as it (then) was " lacked the necessary degree of precise delineation or description to so qualify it as a parcel of land.

32. As at that date, the only fact, condition or circumstance that gave the parcel any sense of a separate identity or, more fundamentally even a separate existence, was the imperfectly executed 1973 tripartite land exchange agreement and the constructive trust or obligation impressed upon BHP as the owner of lot 1 in Deposited Plan 238860 in respect of an imprecisely defined or delineated part of that lot.

33. The fact that subsequent events in 1986 (BHP's Deed and the registration of Deposited Plan 737463) ultimately provided the precise definition and delineation of (i) the public reserve lot to be vested in the Council as a dedicated public reserve and (ii) the residue lot to be retained by BHP, though providing evidence that the two parcels which together comprised lot 1 in Deposited Plan 238860 were "ascertainable", does not provide the necessary credential or criterion for the precise delineation or description of the lots as they were as at the relevant date in 1981.

34. In other words, the events of 1986 which resulted in the lots coming into existence as separate lots (100 and 101) in Deposited Plan 737463 cannot be simply transposed or related back (either notionally or otherwise) to the crucial date in 1981 for the purpose of the statutory term "existing holding" appearing in cl 13(1) of the LEP.

35. Even if, contrary to what I have held, it were possible to be satisfied of the requisite precise description or delineation of the lots as at the relevant date in 1981, so that there were in existence at that date, two separate parcels (which ultimately were to become lots 100 and 101 in Deposited Plan 737463) the Applicant's contention that the development site by itself relevantly constituted an "existing holding" would, in my judgment nevertheless fail because in such circumstances cl 13(1)(b) would apply to require the aggregation of those two parcels so as to comprise a single "existing holding".

36. The Applicant sought to resist this result by arguing that the reference in cl 13(1)(b) to "ownership" of two or more adjoining or adjacent parcels meant "beneficial ownership" and that since BHP's ownership of the parcel that ultimately was vested in the Council as a dedicated public reserve was impressed with the constructive trust or obligation in favour of the Council, BHP did not relevantly own that parcel, rather the Council did.

37. In my judgment, the reference, in cl 13(1)(b) to "ownership" is not limited to beneficial ownership. The term "own" is not defined in the LEP. However, the term "owner" is defined in the EP&A Act as relevantly having the same meaning as in the Local Government Act 1993. In the Dictionary to the Local Government act 1993 "owner" relevantly is defined as follows:

…………..

…………… (b) in relation to land other than Crown Land includes: (i) every person who jointly or severally, whether at law or in equity, is entitled to the land for any estate of freehold in possession;

………………..

38. This meaning is relevant to the expression in cl 13(1)(b) of the LEP " where…a person owned two or more adjoining or adjacent lots…. " by virtue of the combined operation of the Interpretation Act 1987 , s 7 and s 10 , there being nothing in the context or subject matter that would indicate or require " otherwise ": vide the Interpretation Act s 6 .

39. Based upon my factual findings, it follows, in my judgment, that on 21 August 1981 BHP "owned 2….adjoining…parcels of land…" within the meaning of cl 13(1)(b) of the LEP, it not being relevant to that ultimate conclusion that one parcel was so owned beneficially and the other only "legally" (ie not beneficially).

40. It further follows that the development site does not qualify as an "existing holding" within the meaning of cl 13(1) of the LEP.

41. Accordingly, it must be concluded that the development site is not "an existing holding" within the meaning of cl 13(1) of the LEP because either (i) it did not exist as at 21 August 1981 as a "parcel of land"; or (ii) if it did so exist, it was owned by the same person who also owned an adjoining lot as at that date and hence, it is the aggregation of the lots which relevantly comprised the "existing holding".

D. DOES CLAUSE 13(2) OR CL 13(3) OF THE LEP IMPOSE A DEVELOPMENT STANDARD IN RESPECT OF SPECIFYING THE MINIMUM AREA OF AN ALLOTMENT UPON WHICH A DWELLING-HOUSE MAY BE ERECTED?

42. The Applicant submits that cl 13(2)(a) of the LEP imposes a development standard as that term is defined by the EP&A Act s 4(1), namely "development standards" means:

development standards means provisions of an environmental planning instrument or the regulations in relation to the carrying out of development, being provisions by or under which requirements are specified or standards are fixed in respect of any aspect of that development, including, but without limiting the generality of the foregoing, requirements or standards in respect of: (a) the area, shape or frontage of any land, the dimensions of any land, buildings or works, or the distance of any land, building or work from any specified point, (b) the proportion or percentage of the area of a site which a building or work may occupy, (c) the character, location, siting, bulk, scale, shape, size, height, density, design or external appearance of a building or work, (d) the cubic content or floor space of a building, (e) the intensity or density of the use of any land, building or work,

……………

………….

43. Relying upon the decision of the Court of Appeal in Bell v Shellharbour Municipal Council (1993) 78 LGERA 419, the Applicant submitted that " whether a particular clause in a local environmental planning instrument has the effect of regulating or prohibiting development is a matter of construction ".

44. The Applicant, after citing familiar passages from the judgment of Holland J in Kruf v Warringah Shire Council (unreported Land and Environment Court 25 December 1988) and North Sydney Municipal Council v P D Mayoh Pty Limited (No 2) (1990) 71 LGRA 222, submitted that cl 13(2)(a) of the LEP "is not saying that there shall be no development for the purposes of a dwelling-house on land within the subject zone, but rather that there may be such development within the zone if it complies with a requirement or standard, namely a requirement or standard in respect of "the area of any land", and arguably also in respect of "the intensity or density of the use of any land".

45. Finally, the Applicant's argument submits that cl 13(2)(a) of the LEP was "relevantly indistinguishable from the (statutory) clause considered by Talbot J in Pancho Properties Pty Ltd v Wingecarribee Shire Council" (unreported 29 October 1999) which was held to be a development standard.

46. The Council's competing argument was that cl 13(2), (3) and (4) of the LEP each contained prohibitions on development which "lay down preconditions or facts which must be established before the power to grant consent can be exercised".

47. In support of this ultimate submission, the Council's detailed argument analysed cl 13 of the LEP as establishing pre-conditions to the power conferred upon the consent authority to grant consent to the erection of a dwelling-house. The argument then essayed an analysis of the many decided cases in this area of the law before propounding the following thesis "to explain the seemingly diverse decisions of the Land and Environment Court and the Court of Appeal":

This basic distinction, between provisions which establish preconditions or facts which must exist in order for the power to grant consent to a development to be able to be exercised and provisions which specify requirements or fix standards in respect of an aspect of permissible development, is fundamental to an understanding of the concept of a development standard.

48. After surveying many of the decided cases, the Council's argument finally encounters the decision of Talbot J in Pancho Properties submitting that it " stands against this consistent trend of authority ", and that the decision of Lloyd J in Dixson v Wingecarribee Shire Council (1999) 103 LGERA 103 (which Talbot J in Pancho declined to follow because he was " convinced that it was wrong ") was " more likely to be correct ".

49. In Dixson which involved the same statutory provisions that were considered in Pancho, Lloyd J, applying the reasoning of the judgment of Mahoney JA in North Sydney Council v P D Mayoh Pty Ltd (No 2) (1990 71 LGRA 222, held that the statutory provisions "lay down absolute prohibitions against the development of certain land within certain zones….": see par 32 at p 111.

50. It is of some interest to note that the successful party in Dixson had based its argument upon the same thesis that the Council in the present case has advanced (see at par 24 at 109). However, Lloyd J's decision does not suggest any acceptance (express or implied) of that argument. Moreover, the "condition precedent" argument (if I may compendiously so refer to it) is directly contrary to the decision in the Court of Appeal in Bell.

51. If the question were to be determined without reference to the decided cases, I would have no hesitation in holding as a matter of construction that both cl 13(2)(a) and cl 13(3)(a) of the LEP is relevantly a "development standard" in that each is— (i.) a provision of an environmental planning instrument (namely the LEP); (ii.) in relation to the carrying out of a permissible purpose of development (namely a dwelling-house on land within Zone No 1(a)); (iii.) by which requirements are specified or standards are fixed in respect of an aspect of that development (namely "the area of the land" upon which a dwelling-house may be erected).

52. In so construing, cl 13(2)(a) and cl 13(3)(a) of the LEP, I would respectfully adopt the construction contended by the Applicant in preference to that contended by the Council. With respect, I am wholly unpersuaded by the Council's "condition precedent" argument. In so concluding, I do not think it necessary to separately consider subclause (2) and (3) since they are clearly intended to operate in a mutually complementary manner.

53. In particular, I would place emphasis on the fact that cl 10 of the LEP has the undisputed effect of including "dwelling-house" development as one "of the purposes" which may be carried out in Zone No 1(a) "only with development consent". It is true that cl 10 is expressed to operate "except as otherwise provided by this plan". In this respect, cl 13 of the LEP (contained in a separate Part III "Special Provisions") obviously has some qualifying effect. However, it is important to note the limits of this qualifying effect. Most obviously, it is to be noted that cl 13 is dealing with the subject of dwelling-house development "on an allotment of land within" Zone No 1(a) whereas cl 10 is designating, inter alia, permissible "purposes of development" within the designated zones (where such purposes include in Zone No 1(a) "dwelling house" purposes).

54. The obvious and natural construction of the interplay of those two clauses is that cl 10 designates "dwelling-house" development as a permissible purpose of development within Zone No 1(a) and cl 13 specifies a requirement in respect of the minimum size or area of the allotment of land within such zone upon which the permissible dwelling-house purpose may be carried with development consent. In other words, cl 10 declares dwelling-houses to be a permissible purpose of development in Zone 1(a) and cl 13 specifies the minimum size of the allotment, upon which that permissible purpose of development may be carried out. Most importantly, the specification contained in cl 13 does not operate so as to disqualify "dwelling-house" purposes from being a "permissible purpose" of development within the Zone. In other words, cl 13 operates in a complementary manner to cl 10 by specifying the required minimum size or area of an allotment of land within the zone upon which a dwelling-house, being a permissible purpose of development declared by cl 10, may be erected. So understood, cl 13 does not prohibit what cl 10 permits. Rather, it specifies a requirement in respect of an aspect of a permissible purpose of development (namely a dwelling-house) within Zone No 1(a), namely the minimum area or size of an allotment (situate within that zone) upon which that permissible purpose of development may be carried out with development consent.

55. It is important to note the nature and function in the scheme of the EP&A Act of a "requirement" specified, or a "standard" fixed, by a development standard.

56. Firstly, the "imposition" of a development standard in an environmental planning instrument is a means of "controlling development": s 26(1)(b) where the Act defines in a very comprehensive manner the terms "control" and "development" (s 4(1)).

57. But for the existence of the dispensational power conferred by SEPP No 1, any such "requirement" specified or "standard" fixed, must be obeyed—vide: s 76(1), 76A(1) and s 122 – s 125 (inclusive)—not only by all persons wishing to carry out development, but by consent authorities in determining any development application to carry out development.

58. The dispensational power conferred by SEPP No 1, applies in terms (vide cl 6) to cases "where development could, but for any development standard, be carried out under the Act" and where the dispensational power is exercised, it empowers the grant of development consent "notwithstanding the development standard". It is thus clear beyond argument, that a development standard which is not relaxed by dispensation granted under SEPP No 1, prohibits the carrying out of development.

59. It is also to be noted, the SEPP No 1 "prevails over any inconsistency between it and any other environmental planning instrument whenever made": vide cl 5. This can only mean that a development standard in force under an environmental planning instrument would prohibit the carrying out of the development, but for the operation of SEPP No 1, which prevails in the case of inconsistency with other planning instruments.

60. Having regard to the nature and function of a development standard, (and more particularly the nature and function of the "requirements" specified, or the "standards" fixed, by a development standard), it may readily be appreciated that there are overwhelming inherent limitations both in the validity and utility of resorting (as do many of the decided cases) to the dichotomy of "prohibition v regulation" in the task of determining , as a matter of construction, whether or not a particular provision of an environmental planning instrument is a development standard.

61. This is a crucial matter to appreciate in the task of construction, to which I recently drew attention in Bowen v Willoughby City Council [2000] NSWLEC 69. In the present case, I have gone further in my exposition of this crucial matter.

62. Another matter of general importance to be noted is the fact that SEPP No 1 has been in force virtually throughout the entire life of the EP&A Act (the Act commenced on 1 September 1980 and SEPP No 1 commenced on 17 October 1980: vide Government Gazette No 152). This fact gives rise to the practical consequence that it has been necessary in cases involving SEPP No 1 to interpret the relevant provisions contained in the environmental planning instrument made under the EP&A Act in the light of the prevailing force given to SEPP No 1 by cl 5 in the case of inconsistency with any environment planning instrument whenever made.

63. However, I think there is a more significant implication of this fact. Although SEPP No 1 adopts the meaning of "development standards" contained in the EP&A Act and cannot, in any event, expand the concept as so defined in the Act, the construction of planning controls contained in environmental planning instruments may, in my judgment, legitimately reflect the legislative awareness of the existence of the dispensational power conferred by SEPP No 1 in respect of such controls operating by virtue of development standards, and, I would add, in respect of such controls which are reasonably capable (by dint of the process of statutory construction) of so operating. In this respect, I think the task of determining whether a particular provision of an environmental planning instrument is a "development standard" calls for a purposive and beneficial construction which recognises the beneficial purpose of SEPP No 1 as expressly declared in cl 3:

This Policy provides flexibility in the application of planning controls operating by virtue of development standards in circumstances where strict compliance with those standards would, in any particular case, be unreasonable or unnecessary or tend to hinder the attainment of the objects specified in section 5(a)(i) and (ii) of the Act.

64. It is now necessary for me to consider whether the foregoing opinions and my exposition of relevant principles that have been undertaken without reference to the decided cases are nevertheless consistent with the relevant case law, at least to the extent that it provides either binding authority or definitive guidance.

65. As I would respectfully understand the relevant decisions of the Court of Appeal, I am of the opinion that what I have said is entirely supported by the decision of the Court of Appeal in Bell v Shellharbour Municipal Council (1993) 78LGERA 429. In my respectful opinion, it is that decision (which is the latest decision of that Court which has fully considered the question of what provisions of an environmental planning instrument are development standards) that provides the most definitive guidance as to how the task of construction is to be undertaken in the present context.

66. That decision, although not referred to in the later Court of Appeal decisions in Healesville Holdings Pty Ltd v Pittwater Council (1997) 97LGERA 95 and in Fast Buck$ v Byron Shire Council (1999) 103 LGERA 94, is consistent with the concession made by the Council in Healesville (where the Court considered it unnecessary to decide whether the concession was well founded) and is entirely consistent with the decision in Fast Buck$ (which is the most recent occasion that the Court of Appeal has considered the operation of SEPP No 1, but without directly addressing the question whether a development standard was involved, that fact simply being assumed.)

67. For present purposes, it will be sufficient if I repeat the analysis of Bell which I made in the following passages in Bowen v Willoughby Council:

In Bell , Cripps JA, in holding the concession that the relevant statutory provisions constituted development standards to be correctly made , considers the decided cases in the following passage at 432/433 in a manner that I would respectfully adopt:

In the course of argument, reference was made by both counsel to a number of decisions dealing with certain clauses in planning instruments and the amenability of those clauses to the dispensing power in State Environmental Planning Policy No 1 : see North Sydney Municipal Council v P D Mayoh Pty Ltd [No 2] (1990) 71 LGRA 222, Quinn O'Hanlon Architects Pty Ltd v Leichhardt Municipal Council (1989) 68 LGRA 114 , Kruf v Warringah Shire Council (Land and Environment Court of New South Wales, 15 December 1988, unreported), Napper v Shoalhaven City Council (Land and Environment Court of New South Wales, 26 February 1988, unreported), Ford Mirvac Developments Pty Ltd v Blacktown City Council (Land and Environment Court of New South Wales, 3 April 1990, unreported), Challister Ltd v Blacktown City Council (1992) 76 LGRA 10 and Nooramunga Holdings Pty Ltd v Shoalhaven City Council (Land and Environment Court of New South Wales, 7 February 1991, unreported). I trust I do no disservice to the arguments presented when I say it is unnecessary in this appeal to deal with these cases. There is, self-evidently, a difference between a clause absolutely prohibiting development on the one hand and a clause regulating development by specifying requirements or fixing standards on the other. Whether a particular clause in a local environmental planning instrument has the effect of regulating or prohibiting development is a matter of construction. In some of the cases the Court has held that the relevant clause was an absolute prohibition — in others it was held that the clause was regulatory. But, as was pointed out in Mayoh , the obligation of the Court is to interpret the clause in the instrument before it.

It is of more than passing interest to note the relevant statutory provisions considered in Bell in the light of the relevant facts of that case. The proposed development involved the subdivision of a parcel of land some 18 ha in area into two lots, one of 2 ha and the other of 16 ha, where both proposed lots would contain areas far less than the prescribed minimum area (40 ha ) and one of the lots would contain a frontage to the highway far less than the prescribed minimum frontage.

Relevantly, the statutory provisions contained in the Shellharbour Local Environmental Plan were to forbid the subdivision of land without development consent (cl 15) and cl 16(2)) which applied to the subject land confined the power to so consent, by providing as follows:

(2) The council shall not consent to the subdivision of land to which this clause applies unless each allotment of land to be created by the subdivision will have — (a) an area of not less than 40 hectares; and (b) where the allotment has frontage to a main road — a frontage of not less than 200 metres.

Accordingly, the combined effect of the relevant statutory provisions was that subdivision of land required development consent, but that the council was forbidden from granting consent to a subdivision unless each proposed lot had a minimum area of 40 ha and where the lot had frontage to a main road, had a minimum frontage of 200 m.

Applying those provisions to the relevant facts of the case, it would be an unexceptional deduction to say that the proposed subdivision was prohibited development because each of the lots proposed to be created contained an area far less than the prescribed minimum area. Indeed logically it could be deduced, again unexceptionally, that the relevant land was legally incapable of subdivision for the intended purposes because it simply lacked the requisite area to be subdivided in accordance with the relevant statutory provisions.

Nonetheless, the Court held that the statutory provisions relevantly constituted development standards because cl 16(2) contained provisions specifying requirements or fixing standards in respect of an aspect of the proposed development: at 431.

Bell, in my respectful opinion, sounds an important cautionary note against an oversimplistic or excessive reliance in this field of jurisprudence, upon the dichotomy of prohibition and regulation as providing the interpretive solvent to whether a particular statutory provision is, or is not, relevantly a development standard.

Although the later decision of the Court of Appeal in Healesville appears to have adopted a more cautious approach as to whether a very similar statutory provision (albeit in an urban setting) operated as a development standard (inasmuch as Priestley JA who gave the leading judgment considered it unnecessary to consider whether the concession that a development standard was involved, was well founded) the Court's attention does not appear to have been directed to the decision in Bell. Rather, the argument directed attention to the earlier decisions in Vaniga and P D Mayoh.

However, in the still later decision of the Court of Appeal in Fast Buck$ v Byron Shire Council (1999) 103 LGERA 94 where the relevant statutory provisions and relevant facts were not materially different from those in Bell, the Court of Appeal proceeded on the basis that the statutory provision was relevantly a development standard amenable to the dispensational power conferred by SEPP No 1.

It is not necessary in the present case to completely explore the ramifications of the Court of Appeal's decision in Bell for the conventional dichotomy of prohibiting and regulating controls on development other than to make two observations. Firstly, it appears too late in the day to say that the dichotomy serves no useful purpose. Clearly, it is an apt descriptor of the interpretive result in cases as to whether provisions are or are not, development standards. Secondly, that a development standard may involve prohibition was recognised as long ago as 1985 when Carr was decided: see at 269 per McHugh JA (as he then was). Even in P D Mayoh, which appears to be the high water mark of the influence of the dichotomy, Clarke JA recognised at 238 that the substantial effect of particular prohibitions….may be to impose a requirement (constituting a development standard).

68. In the present case, I have delved more deeply into the questionable utility of recourse to the " prohibition v regulation" dichotomy, but only to the extent necessary to resolve the present question of statutory construction, being satisfied that in so doing, my reasoning is entirely supported by the decision in Bell . It may be that the present case is, in any event, entirely answered by application of the decision in Bell . If so, then I have travelled further than needed, in deference to the detailed submissions advanced by the Council and for the purpose of fully explaining my approach to construing cl 13 of the LEP.

69. For completeness, and because it was expressly referred to in the Council's argument, I should say that the earlier decision of the Court of Appeal in Byron Shire Council v Chrestal Pty Ltd (1983) 49LGRA 88, is entirely consistent with the proposition that the dispensational power conferred by SEPP No 1 was applicable to a provision in the planning instrument which impliedly prohibited the erection of a dwelling-house upon non-urban land not possessing the prescribed minimum size or area.

E. CONCLUSIONS AND ORDERS

70. For all the foregoing reasons, I determine the preliminary questions of law as follows: Question 1 Is the development site an "existing holding" in terms of cl 13(1) of the LEP? Answer: No Question 2 Is cl 13(2)(a) or cl 13(3)(a) of LEP a development standard? Answer: Yes.

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