R.I.G Consulting Pty Ltd v Queanbeyan-Palerang Regional Council (No 2) [2020] NSWLEC 184

Land and Environment Court New South Wales

Medium Neutral Citation: R.I.G Consulting Pty Ltd v Queanbeyan-Palerang Regional Council (No 2) [2020] NSWLEC 184 Hearing dates: 18 December 2020 Decision date: 23 December 2020 Jurisdiction: Class 1 Before: Pain J Decision: See [75] of judgment Catchwords: MERITS APPEAL – separate questions of law –proposed subdivision of neighbourhood lot prohibited by local environmental plan as exceeds permitted average lot size – neighbourhood lot a resulting lot under local environmental plan and subdivision cannot be granted under local environmental plan Legislation Cited: Community Land Development Act 1989 (NSW) s 22, Sch 4 (cl 1) Conveyancing Act 1919 (NSW) s 195 Environmental Planning and Assessment Act 1979 (NSW) ss 1.5, 3.20, 4.2, 6.2, former s 94 Palerang Local Environmental Plan 2014 cll 2.6, 4.1, 4.1AA, 4.1A, 4.1B, 4.1C, 4.1D, former cl 4.1 Real Property Act 1900 (NSW) s 42 Standard Instrument (Local Environmental Plans) Amendment (Minimum Subdivision Lot Size) Order 2018 Standard Instrument (Local Environmental Plans) Order 2006 cll 2, 3, 4, 4A, 5 Standard Instrument-Principal Local Environmental Plan (2006 EPI 155a) cll 4.1, 4.1AA Yarrowlumla Local Environmental Plan 2002 cll 17, 20 Cases Cited: Allandale Blue Metal Pty Ltd v Roads and Maritime Services (2013) 195 LGERA 182; [2013] NSWCA 103 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2 DM & Longbow Pty Ltd v Willoughby City Council (2017) 228 LGERA 342; [2017] NSWLEC 173 Fairfield City Council v N & S Oliveri Pty Ltd [2003] NSWCA 41 Fitch v Shoalhaven City Council (1977) 67 LGRA 165 R v Wallis; Ex parte Employers' Association of Wool Selling Brokers (1949) 78 CLR 529; [1949] HCA 30 R.I.G Consulting Pty Ltd v Queanbeyan-Palerang Regional Council [2020] NSWLEC 155 Category: Procedural and other rulings Parties: R.I.G Consulting Pty Ltd (Applicant) Queanbeyan-Palerang Regional Council (Respondent) Representation: COUNSEL: S White SC (Applicant) J Walker (Respondent)

SOLICITORS: Hazan Hollander (Applicant) Bradley Allen Love (Respondent) File Number(s): 20/156307

Judgment 1. The development the subject of these Class 1 merits appeal proceedings is the proposed subdivision of an existing neighbourhood lot within an existing neighbourhood scheme, as provided by s 22 of the Community Land Development Act 1989 (NSW) (CLD Act). In R.I.G Consulting Pty Ltd v Queanbeyan-Palerang Regional Council [2020] NSWLEC 155 the Court ordered that the following questions be determined separately from any other question in these proceedings: (1) Is the subdivision for which the applicant seeks development consent a subdivision to which the provisions of clause 4.1B(4)(a) of the Palerang Local Environmental Plan 2014 ("PLEP") apply? (2) If so, is the grant of development consent to the development application precluded by that clause? (3) Is Lot 4 DP 285984 a "resulting lot" within the meaning of clause 4.1B(6) of the PLEP? (4) If so, is the subdivision proposed by the development application one for which development consent must not be granted in accordance with clause 4.1B(5) of the PLEP? 1. The Applicant's proposal is for the subdivision of Lot 4 DP 285984 into two or more parts to be adapted for separate occupation. The subdivision is intended to occur through the registration of a neighbourhood plan of subdivision as a deposited plan, as provided for in s 6.2(1)(b) and s 6.2(2)(a) of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act). A plan of subdivision as defined in s 195(1) and (2)(b) of the Conveyancing Act 1919 (NSW) includes a neighbourhood plan of subdivision. It is therefore development to which s 4.2 of the EPA Act applies. Under s 4.2, if an environmental planning instrument (EPI) provides that specified development may not be carried out except with development consent, a person must not carry out the development unless development consent has been obtained and is in force. 2. Questions 1 and 2 concern separate issues to Questions 3 and 4.

Community Land Development Act 1989 (NSW) 1. Section 22 of the CLD Act provides: Part 3 Neighbourhood schemes … 22 Subdivision of neighbourhood lots and related neighbourhood property (1) Neighbourhood lots or neighbourhood property, or neighbourhood lots and some, but not all, of the related neighbourhood property, may be subdivided by the registration of a neighbourhood plan of subdivision as a deposited plan. (2) A neighbourhood plan of subdivision must include, as sheets of the plan: (a) if the plan subdivides or creates neighbourhood property—a replacement sheet for the neighbourhood property plan showing the altered boundaries of the neighbourhood property, and (b) if the plan subdivides or creates neighbourhood lots—an additional sheet of the detail plan of the neighbourhood plan showing the boundaries of the neighbourhood lots created by the subdivision, and (c) a replacement sheet for the initial or revised schedule of unit entitlements for the neighbourhood plan. …. (4) A neighbourhood lot created by a subdivision of neighbourhood property ceases to be neighbourhood property. (5) Neighbourhood lots, and neighbourhood property, may be subdivided only: (a) in accordance with subsection (1), or (b) by an acquisition plan.

Environmental Planning and Assessment Act 1979 (NSW) 1. Relevant sections of the EPA Act provide: Part 1 Preliminary … 1.5 Meaning of "development" (1) For the purposes of this Act, development is any of the following— … (b) the subdivision of land, … (2) However, development does not include any act, matter or thing excluded by the regulations (either generally for the purposes of this Act or only for the purposes of specified provisions of this Act). (3) For the purposes of this Act, the carrying out of development is the doing of the acts, matters or things referred to in subsection (1). … Part 6 Building and subdivision certification Division 6.1 Preliminary … 6.2 Meaning of "subdivision" of land (1) For the purposes of this Act, subdivision of land means the division of land into 2 or more parts that, after the division, would be obviously adapted for separate occupation, use or disposition. The division may (but need not) be effected— (a) by conveyance, transfer or partition, or (b) by any agreement, dealing, plan or instrument rendering different parts of the land available for separate occupation, use or disposition. (2) Without limiting subsection (1), subdivision of land includes the procuring of the registration in the office of the Registrar-General of— (a) a plan of subdivision within the meaning of section 195 of the Conveyancing Act 1919, or (b) a strata plan or a strata plan of subdivision within the meaning of the Strata Schemes Development Act 2015. …

Standard Instrument (Local Environmental Plans) Order 2006 1. Relevant provisions of the Standard Instrument (Local Environmental Plans) Order 2006 (SI Order) provide: 2 Purpose of Order This Order prescribes the form and content of a principal local environmental plan for an area for the purposes of section 3.20 of the Environmental Planning and Assessment Act 1979. 3 The standard instrument The standard instrument for a principal local environmental plan is the instrument set out at the end of this Order. 4 Mandatory provisions of the standard instrument (1) The mandatory provisions of the standard instrument prescribed by this Order are as follows— (a) provisions identified in the standard instrument as compulsory provisions (whether in all cases or only those cases prescribed by the standard instrument), (b) provisions identified in the standard instrument as optional provisions if a decision is made to adopt the provisions when the plan is made. (2) If an optional provision is to be adopted, it is to be adopted without variation (subject to any relevant direction in the standard instrument). An optional provision that is so adopted is the provision as in force under this standard instrument from time to time. (3) If a compulsory provision is not applicable because of the circumstances referred to in the heading to the provision, the number or other identifier of the provision is to be set out in the plan with the words "[Not applicable]" or words to the same effect. (4) If an optional provision is not to be adopted, the number or other identifier of the provision is to be set out in the plan with the words "[Not adopted]" or words to the same effect. 4A Optional provisions may be compulsory in certain cases An optional provision adopted with respect to a plan may include a statement that the provision is a compulsory provision for the purposes of this clause and in such a case the provision is taken to be a compulsory provision with respect to that plan. 5 Additional provisions (1) Additional provisions may be included in the plan, but only if they are not inconsistent with the mandatory provisions of the standard instrument and comply with any relevant directions in that instrument. (2) Additional provisions included in the plan are to be numbered in accordance with the usual protocol applicable to amendments made to existing Acts and statutory instruments to include additional provisions. …

Standard Instrument-Principal Local Environmental Plan (2006 EPI 155a) 1. Relevant provisions of the Standard Instrument-Principal Local Environmental Plan (2006 EPI 155a) (SILEP) provide: Part 4 Principal development standards 4.1 Minimum subdivision lot size [optional] (1) The objectives of this clause are as follows— (a) [set out objectives of the clause] (2) This clause applies to a subdivision of any land shown on the Lot Size Map that requires development consent and that is carried out after the commencement of this Plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies is not to be less than the minimum size shown on the Lot Size Map in relation to that land. Direction— An exception to the minimum size shown on the Lot Size Map may be provided in certain circumstances, for example, in the case of land that is to be used for attached dwellings. (4) This clause does not apply in relation to the subdivision of any land— (a) by the registration of a strata plan or strata plan of subdivision under the Strata Schemes Development Act 2015, or (b) by any kind of subdivision under the Community Land Development Act 1989. … 4.1AA Minimum subdivision lot size for community title schemes [optional if clause 4.1 is adopted] (1) The objectives of this clause are as follows— (a) [set out objectives of the clause] (2) This clause applies to a subdivision (being a subdivision that requires development consent) under the Community Land Development Act 1989 of land in any of the following zones— (a) [list relevant zones], but does not apply to a subdivision by the registration of a strata plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies (other than any lot comprising association property within the meaning of the Community Land Development Act 1989) is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause applies despite clause 4.1. Direction— An exception to the minimum size shown on the Lot Size Map may be provided in certain circumstances, for example, in the case of land that is to be used for attached dwellings.

Palerang Local Environmental Plan 2014 1. Relevant provisions of the Palerang Local Environmental Plan 2014 (PLEP) provide: Part 2 Permitted or prohibited development … 2.6 Subdivision—consent requirements (1) Land to which this Plan applies may be subdivided, but only with development consent. (2) Development consent must not be granted for the subdivision of land on which a secondary dwelling is situated if the subdivision would result in the principal dwelling and the secondary dwelling being situated on separate lots, unless the resulting lots are not less than the minimum size shown on the Lot Size Map in relation to that land. Part 4 Principal development standards 4.1 Minimum subdivision lot size (1) The objectives of this clause are as follows— (a) to minimise any likely impact of subdivision and development on the amenity of neighbouring properties, (b) to ensure that lot sizes and dimensions are appropriate having regard to the objectives of this Plan and the relevant zone and the likely future use of the land, (c) to ensure that lot sizes and dimensions allow dwellings to be sited to protect significant natural or cultural features. (2) This clause applies to a subdivision of any land shown on the Lot Size Map that requires development consent and that is carried out after the commencement of this Plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause does not apply in relation to the subdivision of any land— (a) by the registration of a strata plan or strata plan of subdivision under the Strata Schemes Development Act 2015, or (b) by any kind of subdivision under the Community Land Development Act 1989. 4.1AA Minimum subdivision lot size for community title schemes (1) The objectives of this clause are as follows— (a) to ensure that land to which this clause applies is not fragmented by subdivisions that would create additional dwelling entitlements. (2) This clause applies to a subdivision (being a subdivision that requires development consent) under the Community Land Development Act 1989 of land in any of the following zones— (a) Zone RU1 Primary Production, (b) Zone RU5 Village, (c) Zone R2 Low Density Residential, (d) Zone R5 Large Lot Residential, (e) Zone E3 Environmental Management, but does not apply to a subdivision by the registration of a strata plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies (other than any lot comprising association property within the meaning of the Community Land Development Act 1989) is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause applies despite clause 4.1. 4.1A Lot averaging subdivision of certain land in Zone RU1 and Zone E3 (1) The objectives of this clause are as follows— (a) to prevent the fragmentation of certain land in Zone RU1 Primary Production and Zone E3 Environmental Management, (b) to enable appropriate subdivision design of that land having regard to topographical constraints, agricultural productivity, biodiversity values and environmental impacts. … 4.1B Lot averaging subdivision of land in Zone E4 (1) The objective of this clause is to ensure that the subdivision of land to which this clause applies has regard to the topographical constraints, agricultural productivity and biodiversity values of, and environmental impacts on, the land. (2) This clause applies to land in Zone E4 Environmental Living. (3) Despite clause 4.1, development consent may be granted to subdivide land to which this clause applies, other than under the Community Land Development Act 1989, if— (a) the average size of all the lots created by the subdivision will not be less than the minimum size shown on the Lot Size Map in relation to that land, and (b) none of the lots created by the subdivision will be less than 2 hectares. (4) Despite clause 4.1, development consent may be granted for the subdivision of land to which this clause applies, under the Community Land Development Act 1989, if— (a) the average size of all the lots created by the subdivision will not be less than the minimum size shown on the Lot Size Map in relation to that land, and (b) none of the lots created by the subdivision will be less than 1 hectare, and (c) the lot comprising the association property (within the meaning of that Act) will include land identified as having significant ecological, agricultural or cultural values. (5) Development consent must not be granted for the subdivision of a resulting lot for the purposes of residential accommodation. (6) In this clause— resulting lot means a lot able to be used for residential accommodation, being— (a) a lot that was created by a subdivision under this clause (other than for a public purpose), or (b) a lot that was created by a subdivision under any of the following provisions (other than a lot the area of which was excluded under the provision from the calculation of the average area of the lots to be created by the subdivision)— (i) clause 20 of Yarrowlumla Local Environmental Plan 2002, (ii) clause 13 (4) or 13A of Yarrowlumla Local Environmental Plan 1993, (iii) clause 14 (4) of Yarrowlumla Local Environmental Plan 1986, (iv) clause 11B (3) or 11C of Interim Development Order No 1—Shire of Yarrowlumla, (v) clause 16 (3) of Tallaganda Local Environmental Plan 1991, and includes a lot that would have been a resulting lot had it not been affected by— (c) a minor realignment of its boundaries that did not create an additional lot, or (d) a consolidation with adjoining land, or (e) a subdivision creating or widening a public road or public reserve or for another public purpose, or (f) a consolidation with an adjoining public road or public reserve or for another public purpose.

Former cl 4.1 of the PLEP 1. Between 3 April 2018 to 19 April 2018 cl 4.1 of the PLEP stated as follows: Part 4 Principal development standards 4.1 Minimum subdivision lot size (1) The objectives of this clause are as follows: (a) to minimise any likely impact of subdivision and development on the amenity of neighbouring properties, (b) to ensure that lot sizes and dimensions are appropriate having regard to the objectives of this Plan and the relevant zone and the likely future use of the land, (c) to ensure that lot sizes and dimensions allow dwellings to be sited to protect significant natural or cultural features. (2) This clause applies to a subdivision of any land shown on the Lot Size Map that requires development consent and that is carried out after the commencement of this Plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause does not apply in relation to the subdivision of individual lots in a strata plan or community title scheme. [subclause (4) was subsequently amended to current version set out above]

LEP Practice Note 1. The LEP Practice Note "Preparing LEPS using the Standard Instrument: standard clauses" (Reference Number PN 11-001) issued by the Department of Planning dated 10 March 2011 provides: Introduction This Practice Note addresses the clauses in the Standard Instrument–Principal Local Environmental Plan (the Standard Instrument). It provides guidance on how to use the mandatory (compulsory and optional) clauses and where and how a council may introduce local content, either into a mandatory clause or through a separate local clause. The Standard Instrument (Local Environmental Plans) Order 2006 (the SI Order) prescribes the form and content of a Standard Instrument for the purposes of section 33A of the Environmental Planning and Assessment Act 1979. Clauses 1 to 7 of the SI Order set up the legal framework for a Standard Instrument, which is set out at the end of the SI Order. … Optional clauses Optional clauses are those that a council may elect to include in its principal Standard Instrument LEP, e.g. the clause on temporary use of land. However, if a council wishes to have a clause on this matter, then the standard clause must be used. Councils should not add local clauses that can be addressed using the optional clauses. If not adopted, the number and name of the clause should appear with the words "not adopted"," or words to the same effect. The optional clauses are: … 4.1 Minimum subdivision lot size 4.1AA Minimum subdivision lot size for community title schemes … When a council can add local content to a standard clause Generally a local subclause should not be added to a standard mandated clause. There are, however, a number of specific standard clauses where a council can, in accordance with a direction, add the type of local content specified. These are: … 4.1 Minimum subdivision lot size 4.1AA Minimum subdivision lot size for community title schemes … Councils can include local provisions Council can add local clauses that address specific local circumstances where justified. These could be a result of relevant planning components of council's local strategic planning, or required under a section 117 direction, or regional or metropolitan strategy. Any such local clauses are not to be inconsistent with and should not undermine the effect of: the mandated clauses in the Standard Instrument; the permissibility or otherwise of land use as detailed in the Land Use Table; or any other relevant State and regional policies, strategies, directions etc. …

Statement of Agreed Facts 1. The parties' statement of agreed facts (SOAF) (Ex B) provided as follows: 1 The land the subject of this application comprises lot 4 DP 285984, part of the Burra Estate. 2 The prior title to Folio id. 4/285984 was Folio id. 4/849360, which was created on 20 July 1995 and cancelled on 2 June 2006, when Folio id. 4/285984 was created by the registration of the Neighbourhood Scheme for the Burra Estate. 3 On 21 February 2006, the Management Statement under the CLDA that forms part of the Burra Estate Neighbourhood Scheme was certified by the Respondent. 4 On 14 March 2006, the Development Contract under the CLDA that that forms part of the Burra Estate Neighbourhood Scheme was certified by the Respondent. 5 The Neighbourhood Scheme and associated Development Contract for the Burra Estate were registered on 2 June 2006. 6 Lot 4 DP 285984 is a Neighbourhood Lot in Neighbourhood Scheme DP 285984. 7 The land is zoned E4 – Environmental Living under the PLEP 2014 and able to be used for residential accommodation. 8 The land the subject of this application has an area of 9.862 hectares. 9 The average size of all the lots proposed to be created by the subdivision is 3.286ha. 10 The purpose of the proposed development is for use for residential accommodation. 11 On 26 June 1999, 1999/DA007 was filed with Yarrowlumla Shire Council seeking consent for a 22 lot Rural Residential subdivision of the relevant land comprising lots ranging from 8 to 18ha. Lot 4 DP 849360 was the subject of that DA. 12 On 12 June 2002, the Yarrowlumla Local Environmental Plan 2002 was gazetted and took effect under section 2 of the Yarrowlumla Local Environmental Plan 2002. 13 On 14 May 2003, an amendment to 1999/DA007 was received by Yarrowlumla Shire Council intending to create 29 lots within a community scheme under the Yarrowlumla Local Environmental Plan 2002, with lots ranging in size form 2.01ha to 15.21ha in area. 14 On 8 June 2004, Yarrowlumla Shire Council granted consent to 1999/DA007 under clause 20 of the Yarrowlumla Local Environmental Plan 2002. 15 Lot 4 DP 285984 was created by subdivision of Lot 4 DP 849360 that, at the time, was within Zone 1(d) under the Yarrowlumla Local Environmental Plan 2002. 16 If the minimum lot size requirements contained in Palerang Local Environmental Plan 2014 applies to the site, then the appropriate lot size would be the 6ha referred to in the Lot Size Map.

Reasons for refusal of development application (Ex C) 1. The Council's Notice of Determination of Development Application dated 21 November 2019 notifying the Applicant of the refusal of its development application (DA) on 13 November 2019 (Notice of Determination) (Ex C) provided: REASONS FOR REFUSAL (a) Council has no ability to consent to the subject application in accordance with Clause 4.1B(5) of the Palerang Local Environmental Plan 2014 as Lot 4 DP 285984 having been created under Clause 20 of the Yarrowlumla Local Environmental Plan 2002 forms a resulting lot as defined under Clause 4.1B(6) of the Palerang Local Environmental Plan 2014 (4.15(1)(a)(i) Environmental Planning and Assessment Act 1979). (b) The proposed development resulting in an average lot size of 3.286ha fails to achieve the 6ha average lot size applicable to the subject site and therefore fails to satisfy the requirements of Clause 4.1(b) [sic] (4)(a) of the Palerang Local Environmental Plan 2014 (4.15(1)(a)(i) Environmental Planning and Assessment Act 1979) …

Evidence 1. The Applicant tendered an Evidence Bundle (Ex A), the SOAF (Ex B) (see [11] above) and the Notice of Determination (Ex C) (see [12] above). 2. Exhibit A consisted of several documents including: 1. DP 285984 registered 2 June 2006, including subdivision plans, neighbourhood development contract dated 6 March 2006, neighbourhood management statement dated 21 February 2006 (see SOAF pars 1, 5); 2. historical title results for Lot 4 DP 285984 (see SOAF par 2); 3. historical title results for Lot 4 DP 849360 (see SOAF par 2); 4. Palerang Local Environmental Plan 2014 (see SOAF pars 7, 16); 5. proposed three-lot subdivision plans (see SOAF pars 8, 9); 6. DA form dated 28 March 2019 (see SOAF pars 8, 9, 10); 7. Government Gazette No 96 of 12 June 2002 (pp 3595-3698) containing the Yarrowlumla Local Environmental Plan 2002 (YLEP) (see SOAF par 12); 8. YLEP current as to 1 February 2020 (see SOAF par 12); 9. letter from Jeff Brown Surveys Engineering & Land Surveying regarding the "Burra Station Estate" subdivision, seeking amendment of DA 1999/DA-007 (the 1999 DA) in accordance with the YLEP that had been introduced since the lodgement of that DA, attaching amended subdivision plans inter alia.

Question 1: Is the subdivision for which the Applicant seeks development consent a subdivision to which the provisions of cl 4.1B(4)(a) of the Palerang Local Environmental Plan 2014 apply?

Applicant's submissions 1. Clause 4.1B(4)(a) does not apply to the proposed subdivision. It is necessary to consider the history of making the PLEP, which was made formally on 18 September 2014 in accordance with the SI Order. That prescribes the form and content of a principal local environmental plan (LEP) for the purposes of s 3.20 of the EPA Act. The prescribed form is the SILEP, which specifies a number of mandatory and optional provisions which must or may be adopted in making an LEP. Clauses 4.1 and 4.1AA are optional provisions and were adopted in the PLEP in 2014, becoming mandatory by operation of cl 4(1) of the SI Order. 2. At the time the PLEP was made, cl 4.1 read as follows: 4.1 Minimum subdivision lot size (1) The objectives of this clause are as follows: (a) to minimise any likely impact of subdivision and development on the amenity of neighbouring properties, (b) to ensure that lot sizes and dimensions are appropriate having regard to the objectives of this Plan and the relevant zone and the likely future use of the land, (c) to ensure that lot sizes and dimensions allow dwellings to be sited to protect significant natural or cultural features. (2) This clause applies to a subdivision of any land shown on the Lot Size Map that requires development consent and that is carried out after the commencement of this Plan. (3) The size of any lot resulting from a subdivision of land to which this clause applies is not to be less than the minimum size shown on the Lot Size Map in relation to that land. (4) This clause does not apply in relation to the subdivision of individual lots in a strata plan or community title scheme. 1. Clauses 4.1A, 4.1B, 4.1C and 4.1D of the PLEP are all additional provisions that were created and adopted by the Council. In making those additional provisions, the Council was bound to consistency with cll 4.1 and 4.1AA. It was further bound to comply with directions contained in corresponding clauses in the SILEP. Both cll 4.1 and 4.1AA in the SILEP contain a direction that provides as follows: Direction— An exception to the minimum size shown on the Lot Size Map may be provided in certain circumstances, for example, in the case of land that is to be used for attached dwellings. 1. The LEP Practice Note provides guidance in relation to additional clauses in the SILEP. 2. Clause 4.1B has not been amended since the PLEP was made. 3. At the time that the PLEP was made: 1. Clause 4.1B could easily be read such that no inconsistency existed between the operation of cll 4.1 and 4.1B because subdivision under the CLD Act, other than subdivision of individual lots, was still subject to the minimum lot size requirements contained in cl 4.1(3), and cl 4.1B(4) still had work to do in permitting consent to community title subdivisions that met average lot size requirements but not minimum lot size requirements. 2. Such a reading is clearly compliant with the directions contained in cl 4.1 of the SILEP, that additional provisions may provide exceptions to the minimum lot size requirements. 1. In DM & Longbow Pty Ltd v Willoughby City Council (2017) 228 LGERA 342; [2017] NSWLEC 173 (Longbow) the Court determined that the effect of cl 4.1(4) was that cl 4.1 did not apply to a subdivision of an existing strata lot but did apply to a subdivision created by the registration of a strata plan (see Longbow at [20]-[21]). Similar reasoning would also apply in relation to a neighbourhood plan, namely that cl 4.1 would not apply to the subdivision of an existing lot within a neighbourhood plan but would apply to a subdivision created by the registration of a neighbourhood plan. 2. Following the decision in Longbow, an amendment was made to cl 4.1(4) of the SILEP by way of Standard Instrument (Local Environmental Plans) Amendment (Minimum Subdivision Lot Size) Order 2018 (SI Amendment). The SI Amendment took effect from 20 April 2018. The SI Amendment relevantly changed the wording of cl 4.1(4) to apply to any kind of subdivision under the CLD Act, as opposed to that of an individual lot inside a community title scheme (or strata scheme). 3. The Council made no changes to cl 4.1B in response to the changes imposed by the SI Amendment. 4. The result of the amendment is that cl 4.1B(4), which applies specifically and only to subdivisions under the CLD Act, would have no operation as an exception to minimum lot size requirements because, by virtue of cl 4.1(4) as amended, such minimum lot size requirements do not apply to any kind of subdivision under the CLD Act. 5. If the Council had wanted to introduce minimum subdivision lot sizes it could have done so by including E4 zoned land in cl 4.1AA.

Council's submissions 1. Clause 4.1B(4)(a) does apply to the proposed subdivision as it applies expressly to land in zone E4 Environmental Living, as specified in cl 4.1B(2), where the land is located. Community title subdivisions are expressly excluded from cl 4.1 under subcl (4). 2. Nothing in the SI Order, SI LEP or the LEP Practice Note renders cl 4.1B(1)(a) inconsistent with cll 4.1 and 4.1AA. 3. The Applicant relies on the decision in Longbow. Clause 4.1(4) has since been amended, as the Applicant acknowledges. The wording of cl 4.1(4) as it currently stands is broad and clearly encompasses both new neighbourhood subdivisions and the re-subdivision of existing neighbourhood subdivisions as both are subdivisions "under" the CLD Act.

Finding on Question 1 1. The Council's construction of the PLEP provisions is correct. These provisions are in any event clear on their face. 2. Nothing in the SI Order or the LEP Practice Note prevents the Council making cl 4.1B expressly for community title land in the E4 zone. Additional provisions in LEPs are contemplated by cl 5 of the SI Order, provided these are not inconsistent with mandatory provisions. The Council preferred to apply average lot limits to the subdivision of community title land in the E4 zone rather than minimum lot sizes as in other zones as specified in cl 4.1AA. 3. The reasoning behind the Applicant's submissions was not readily apparent. The relevance of considering the amendment of the earlier version of cl 4.1(4) of the PLEP considered in Longbow is not obvious. The PLEP was amended in 2018 and its construction is not assisted by looking at the earlier version of cl 4.1(4). Further, no statutory construction basis for construing the PLEP as contended for by the Applicant, namely that cll 4.1 and 4.1AA must be read together and no other clause can be made that conflicts with these, was demonstrated. Nor does cl 4.1B conflict with these clauses. Further, the Direction in cll 4.1 and 4.1AA of the SILEP which enables variation of minimum lot sizes has no demonstrated relevance to cl 4.1B. 4. The answer to Question 1 is that cl 4.1B(4)(a) applies to the subdivision.

Question 2: If so, is the grant of development consent to the development application precluded by that clause? 1. As a result of my finding on Question 1, cl 4.1B(4) of the PLEP applies to the proposed subdivision and this question essentially asks whether the DA can be approved. It is agreed that the average size of all the lots proposed is 3.286 ha (SOAF par 9). If the minimum lot size requirements in the PLEP apply, the appropriate lot size would be 6 ha as referred to in the Lot Size Map (SOAF par 16).

Applicant's submissions 1. Clause 4.1B(4) must not prohibit development based on averaging lot size as that is contrary to the application of cl 4.1. The wording of cl 4.1B(4) is "permissive", stating that the Council "may grant" consent.

Council's submissions 1. The Applicant submits that cl 4.1B(4) does not preclude the grant of development consent as it says consent "may" be granted for a subdivision of land which meets the criteria in that clause, rather than expressly prohibiting the grant of consent for a subdivision that does not. 2. The construction contended for by the Applicant would render redundant the provisions of cl 4.1B(4). Any community title subdivision of E4 zoned land could be carried out under the general power of subdivision in cl 2.6 of the PLEP. This absurd outcome can be avoided by applying the principle expressed in R v Wallis; Ex parte Employers' Association of Wool Selling Brokers (1949) 78 CLR 529; [1949] HCA 30 at 550 (cited in Fairfield City Council v N & S Oliveri Pty Ltd [2003] NSWCA 41 (Oliveri) at [14]) as follows: ... [A]n enactment in affirmative words appointing a course to be followed usually may be understood as importing a negative, namely, that the same matter is not to be done according to some other course. This applies especially when the power or duty affirmatively conferred or imposed is qualified by some condition, limitation or direction. 1. These observations apply to the relationship between cll 2.6 and 4.1B(4) of the PLEP. Clause 2.6 is a general power to grant consent to subdivision of any land without limitation as to lot size and character. Clause 4.1B(4) is a specific power to consent to a subdivision of E4 zoned land under the CLD Act subject to limitations. Although those limitations are expressed using the affirmative word "may", they must be taken to import the negative as otherwise restriction could be avoided through recourse to the general power in cl 2.6. 2. Analogous findings in relation to the power to impose conditions of consent requiring the payment of a monetary contribution or dedication of land free of cost under former s 94 of the EPA Act apply, see for example Fitch v Shoalhaven City Council (1977) 67 LGRA 165 at 170 per Stein J (approved in Oliveri at [21] per Spigelman CJ, [75] per Cripps AJA, [39] per Santow AJ). 3. All words must prima facie be given some meaning and effect. If cl 4.1B(4) does not prescribe the only way in which a subdivision may be carried out, it has no effect at all. It is improbable that the drafters so intended. A purposive construction of cl 4.1B(4)(a) in the context of the whole PLEP supports this finding. 4. Clause 4.1B(3) and (4) are complementary provisions, each of which is expressed to apply "(d)espite clause 4.1". Between them, they cover the field of possible subdivision types in the E4 zone. Subclause (4) governs community title subdivisions, while subcl (3) governs all other types of subdivision. 5. The prefatory words "(d)espite clause 4.1" in subcl (3) make it clear that the clause prevails over cl 4.1, which would otherwise prohibit the creation of any lot smaller than that specified in the Lot Size Map. Subclause (3) ameliorates the effect of cl 4.1 in that it allows subdivisions which only satisfy the minimum lot size on average, rather than absolutely. 6. The presence of the same words "(d)espite clause 4.1" at the beginning of subcl (4) at first appears anomalous, because cl 4.1 does not apply to community title subdivisions. However, it makes sense if it means that cl 4.1B(4) applies so as to restrict the lot size of community title subdivisions in spite of the fact that they are otherwise exempt from the minimum lot size control in cl 4.1. 7. It is also noteworthy that, compared to cl 4.1B(3), subclause (4) allows a smaller minimum lot size for community title subdivision but also imposes an additional constraint, namely that the lot comprising the association property must include land identified as having significant ecological, agricultural or cultural value. This shows an intention to carefully regulate community title subdivisions on E4 zoned land, allowing a reduction in lot size in exchange for protection of environmentally sensitive land. In this way, subcl (4) carries into effect the objective expressed in cl 4.1B(1) of ensuring that subdivision of E4 zoned land has regard to its agricultural productivity and biodiversity values. This objective would obviously be undermined if subcl (4) did not constrain the general power to grant consent to a subdivision under cl 2.6. 8. Applying modern principles of statutory construction, it is not necessary to find an ambiguity before considering whether context and purpose of a provision require a different reading than a literal construction, see CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; [1997] HCA 2. The context of the PLEP shows that a literal construction of the provision produces an absurd result. Clause 4.1B(4) should be construed in context as meaning that a subdivision to which it applies may be approved only if it satisfies the limitations therein. This construction precludes grant of consent to the DA the subject of these proceedings.

Finding on Question 2 1. I agree with and accept the Council's submissions concerning the construction of cl 4.1B(4)(a) at [36]-[44]. The Applicant's construction of cl 4.1B(4)(a) does produce absurd results whereby any subdivision of community title land in the E4 zone would be permissible regardless of the average lot size, rendering cl 4.1B(4) ineffective. As there are no other lot size limits for community title lots in E4 zoned land under the PLEP, no lot size controls would operate at all. As I find that the clause applies, the Council must be correct that the average lot sizes are not met by the proposal. Consequently the answer to Question 2 is that the grant of development consent for the subdivision is precluded by cl 4.1B(4).

Question 3: Is Lot 4 DP 285984 a "resulting lot" within the meaning of cl 4.1B(6) of the Palerang Local Environmental Plan 2014? 1. The Applicant submitted that in order to answer Questions 3 and 4, it is necessary to consider the history of the neighbourhood lot. The prior title to the neighbourhood lot was Lot 4 in DP 849360 (Prior Lot) (see SOAF par 2). 2. On 26 June 1999 the 1999 DA was filed with Yarrowlumla Shire Council seeking consent for a 22 lot rural residential subdivision of the relevant land comprising lots ranging from 8 ha to 18 ha. The Prior Lot was the subject of the 1999 DA (see SOAF par 11). 3. On 14 May 2003, Yarrowlumla Shire Council received a proposed amendment to the 1999 DA, intending to create 29 lots within a community scheme (see SOAF par 13). 4. On 8 June 2004, Yarrowlumla Shire Council consented to the 1999 DA (see SOAF par 14). The Notice of Determination of the 1999 DA was made on the same date. That Notice of Determination of the 1999 DA makes no mention of a neighbourhood scheme. 5. On 21 February 2006, the Council certified a management statement forming part of the neighbourhood scheme under which the neighbourhood lot now falls under Sch 4 cl 1 of the CLD Act (see SOAF par 3). 6. On 14 March 2006, the Council certified a development contract forming part of the neighbourhood scheme under which the neighbourhood lot now falls under s 26 of the CLD Act (see SOAF par 4). 7. On 2 June 2006, the neighbourhood lot was created by registration of the neighbourhood plan, development contract and management statement (see SOAF par 5). With the registration of the neighbourhood plan and the creation of the neighbourhood lot, the folio for the Prior Lot was cancelled (see SOAF par 2).

Council's evidence on Question 3 1. On its face, DP 285984 refers to "Approval No 1999/DA-007" and "Subdivision Certificate No 1999/DA-007", and the 1999 DA is expressly referred to in the neighbourhood development contract (DP 285984 contained in Ex A, see [14(a)] above). That the lot layout in the stamped plans approved by consent 1999/DA-007 (1999 consent) and the lot layout in DP 285984 are consistent is also evident on the face of DP 285984. 2. Correspondence on the Council file between the Council and the Applicant contained in the Council's Supplementary Bundle (Ex 1) shows that the linen plan for DP 285984 was procured by the Applicant, having obtained a subdivision certificate under the 1999 consent and otherwise satisfying the Council that conditions of that consent had been satisfied. 3. The Notice of Determination (see [12] above) refers to the proposed development as within a scheme under Pt 2 of the CLD Act. It uses the general term "subdivision". 4. The Council Minutes dated 8 June 2004 contained in the Council's Supplementary Bundle (Ex 1) record the resolution approving the DA as follows: That Council approve the subdivision of Lot 4, DP849360, 38 McDairmid Road, Parish of Burra, to create 29 Community Title rural residential lots and a community lot in two parts, subject to the conditions detailed in the appendix to this report. 1. The DA form (see [14(f)] above) and Statement of Environment Effects (SEE) prepared to accompany the DA form (in Ex 1) also did not specify the kind of subdivision proposed. 2. In a letter amending the DA on 14 May 2004 (see [14(h)] above), the Applicant stated its intention to create "neighbourhood lots" within a "Community Scheme".

Applicant's submissions 1. The Applicant contends the neighbourhood lot does not fall under the definition of a resulting lot under cl 4.1B(6) because: 1. The neighbourhood lot was created by a neighbourhood plan under the CLD Act (see SOAF pars 2, 5). 2. The title to the neighbourhood lot is absolute, and cannot be defeated by any prior dealings or instruments. The doctrine of indefeasibility of title is central to the operation of the Torrens Title system that is enshrined in s 42 of the Real Property Act 1900 (NSW). That section provides that, other than in limited circumstances, title by registration cannot be defeated. The Council has not sought to defeat the registration. Its contentions seek to defeat the title by reference to a cancelled title. 3. The historical searches reveal the prior title, folio identifier 4/843907, was cancelled on 2 June 2006 when the neighbourhood lot was created under the neighbourhood plan and the CLD Act (see SOAF par 2). 4. While it is an agreed fact that Yarrowlumla Shire Council consented to the 1999 DA on 8 June 2004 (see SOAF par 14), it does not follow that the subsequent subdivision by registration of the neighbourhood plan and its associated instruments was pursuant to that consent. In fact, the Notice of Determination for the 1999 DA makes no mention of a neighbourhood plan or neighbourhood lots. Instead it makes vague reference to a community scheme, which was, and still is, an entirely different category of scheme under the CLD Act (see Pts 2 and 3 of the CLD Act). 1. The neighbourhood lot was created on 2 June 2006 by the registration of the neighbourhood plan and its associated instruments as certified by the Council, under the CLD Act. This is the subject of agreed facts (see SOAF pars 2, 5). The neighbourhood lot was not a lot created by a subdivision under cl 20 of YLEP. 2. The creation of the neighbourhood lot occurred almost two years after consent was granted to the 1999 DA for a different kind of subdivision (see SOAF par 14). 3. By reason of the foregoing, Lot 4 DP 285984 is not a resulting lot within the meaning of cl 4.1B(6) of the PLEP.

Council's submissions 1. "Resulting lot" is defined in cl 4.1B(6) for the purposes of cl 4.1B. The land the subject of this application, Lot 4 DP 285984, was created by subdivision pursuant to the 1999 consent granted on 8 June 2004. It is an agreed fact that the 1999 consent was granted "under" cl 20 of the YLEP. 2. The Applicant's position is contradicted by information contained in DP 285984 itself (see [53] above). Correspondence between the Applicant and the Council makes clear that the subdivision which produced Lot 4 was a subdivision pursuant to the 1999 consent and therefore "under" cl 20 of the YLEP (see [53] above). 3. The Applicant alleges that the 1999 consent was for a different kind of subdivision than that which became DP 285984. The 1999 consent, properly construed, is not limited to consent for a community scheme under Pt 2 of the CLD Act. The expression "Community Title" used by the Council (see [55] above) could refer to any kind of subdivision under the CLD Act and should not be read as one precisely distinguishing between community schemes under Pt 2 and neighbourhood schemes under Pt 3. 4. Where a consent is ambiguous on its face, it is permissible to have regard to the DA documents to identify the development for which consent was sought, per Allandale Blue Metal Pty Ltd v Roads and Maritime Services (2013) 195 LGERA 182; [2013] NSWCA 103 at [185]-[189]. 5. As noted in evidence above, neither the DA form nor the SEE specify what kind of subdivision is proposed (see [57] above). Evidence of the Applicant's intention in its letter amending the DA (see [57] above) containing the expressions "neighbourhood lots", "Community Scheme" and "Neighbourhood Management Statement" suggests that the Applicant must, for the letter to be internally consistent, have been using the expression "Community Scheme" in an imprecise way to refer to any kind of subdivision under the CLD Act. To the extent that it is ambiguous, the 1999 consent should be construed as a consent to a neighbourhood scheme subdivision. 6. Even if the registration of DP 849360 as a neighbourhood scheme rather than a community scheme breached the terms of the 1999 consent, the breach does not change the fact that the registration occurred in purported reliance on and "under" that consent, and therefore "under" cl 20 of YLEP. The registration could not have occurred otherwise than under the 1999 consent, because all types of subdivision, other than minor boundary adjustments and road widening, required consent under cl 17 of YLEP.

Finding on Question 3 1. For the reasons given by the Council summarised above in [63]-[68], Lot 4 DP 285984 is a resulting lot as specified in cl 4.1B(6) of the PLEP. Lot 4 is a lot "able to be used for residential accommodation". Dwelling houses are a permissible use in the E4 zone. Lot 4 exceeds the minimum required lot size for erection of a dwelling house which is 6 ha under cl 4.2A(3)(a) of the PLEP and the Lot Size Map. 2. The essence of the Applicant's case seemed to be that because the mechanism for creation of the lot was the registration of a neighbourhood scheme under the CLD Act, cl 4.1B(5) could not apply. As the Council identified, that scheme could only occur following a grant of development consent in accordance with the EPA Act, here under cl 20 of the YLEP as required by cl 17 of the YLEP. The evidence relied on by the Council set out above at [53]-[58] more than adequately supports such an inference for the reasons given by the Council which I have adopted. 3. The answer to Question 3 is that Lot 4 DP 285984 is a resulting lot as defined in cl 4.1B(6).

Question 4: If so, is the subdivision proposed by the development application one for which development consent must not be granted in accordance with cl 4.1B(5) of the PLEP? 1. As the Council submitted, it is asserted by the Applicant that any subdivision under the CLD Act is expressly excluded from the operation of cl 4.1B by cl 4.1(4)(b). However this is not the effect of cl 4.1(4)(b). The clause only excludes subdivisions under the CLD Act from cl 4.1. 2. The Applicant has not provided any basis for construing this exemption so as to apply it to cl 4.1B. The Applicant asserts that if cl 4.1B(5) was intended to operate independently of the other clauses of the PLEP, there would be no reason to have a separate prohibition on the subdivision of resulting lots in cl 4.1A(5). However, cl 4.1A does not overlap with cl 4.1B because it applies in different zones. 3. Question 4 is answered "yes" meaning that development consent may not be granted for the subdivision in accordance with cl 4.1B(5) of the PLEP.

Conclusion 1. The four separate questions have been answered contrary to the Applicant's case. The effect of this must be that the Applicant's DA is prohibited under the PLEP. 2. The parties will be provided with an opportunity to make submissions on an appropriate costs order if they so wish.

********** 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: 23 December 2020