Australian Capital Holdings Pty Ltd v Mackay City Council [2008] QCA 157 (2008) QPELR 608

SUPREME COURT OF QUEENSLAND CITATION: Australian Capital Holdings P/L & Ors v Mackay City Council; Australian Capital Holdings P/L v Mackay City Council & Ors [2008] QCA 157 PARTIES: AUSTRALIAN CAPITAL HOLDINGS PTY LTD ACN 087 497 863 (appellant/first respondent) THE CHIEF EXECUTIVE UNDER THE TRANSPORT INFRASTRUCTURE ACT 1994 (respondent/not a party to the application) EULCOM PTY LTD ACN 102 773 106 (respondent/second co-respondent) W A STOCKWELL PTY LTD ACN 010 095 360 (respondent/third co-respondent) PORTERCO PTY LTD ACN 009 801 736 (respondent/fourth co-respondent) v MACKAY CITY COUNCIL (respondent/applicant) AUSTRALIAN CAPITAL HOLDINGS PTY LTD ACN 087 497 863 (appellant/first respondent) v MACKAY CITY COUNCIL (respondent/second respondent) THE CHIEF EXECUTIVE UNDER THE TRANSPORT INFRASTRUCTURE ACT 1994 (first co-respondent/third respondent) EULCOM PTY LTD ACN 102 773 106 (second co-respondent/first applicant) W A STOCKWELL PTY LTD ACN 010 095 360 (third co-respondent/second applicant) PORTERCO PTY LTD ACN 009 801 736 (fourth co-respondent/third applicant) FILE NO/S: Appeal No 11862 of 2007 Appeal No 11897 of 2007 DC No 3575 of 2006 DIVISION: Court of Appeal PROCEEDING: Application for Leave Integrated Planning Act ORIGINATING COURT: Planning and Environment Court at Brisbane DELIVERED ON: 20 June 2008 -- 1 of 21 -- 2 DELIVERED AT: Brisbane HEARING DATE: 16 May 2008 JUDGES: Holmes and Muir JJA and White J Separate reasons for judgment of each member of the Court, each concurring as to the orders made ORDERS: 1. Allow application for leave to appeal 2. Allow the appeal 3. Set aside the orders made below and order that Appeal No. BD 3575 of 2006 to the Planning and Environment Court be dismissed 4. First respondent to each appeal pay the other parties’ costs of the appeal CATCHWORDS: ENVIRONMENT AND PLANNING – ENVIRONMENTAL PLANNING – PLANNING SCHEMES AND INSTRUMENTS – QUEENSLAND – GENERALLY – where the judge in the Planning and Environment court allowed an appeal against Mackay City Council’s decision to refuse an application by the first respondent for a development permit – where there were substantial conflicts between the application and planning Scheme provisions – where the primary judge determined there were sufficient planning grounds to justify approval despite any conflicts – where the primary judge failed to take into account residential amenity in evaluating sufficiency of planning grounds – whether the primary judge departed from the principle that a Court ought not replace the carefully constructed schemes of a planning authority with its preferred planning strategies – whether the primary judge’s reasons in allowing the appeal constitute an error of law Integrated Planning Act 1997 (Qld) s 3.1.6, s 4.1.52, s 4.4(3) Local Government (Planning and Environment) Act 1990 (Qld), s 4.4(5A) Clark & Ors v Cook Shire Council (2007) 152 LGERA 420; [2007] QCA 139, considered Grosser v Council of the City of Gold Coast (2001) 117 LGERA 153; [2001] QCA 423, considered Leda Holdings Pty Ltd v Caboolture Shire Council & Ors [2006] QCA 271; [2006] QPELR 784, considered Lewiac Pty Ltd and ING Real Estate, Joondalup BV v Gold Coast City Council & Ors [2003] QPELR 385, considered Lewiac Pty Ltd v Gold Coast City Council [1996] 2 Qd R 266, cited Overton & Anor v Redcliffe City Council & Anor [2000] QPELR 250, considered Wilispap Pty Ltd v Mulgrave Shire Council [1992] QPLR 51, considered Yu Feng Pty Ltd v Maroochy Shire Council [2000] 1 Qd R 306, cited -- 2 of 21 -- 3 COUNSEL: P J Lyons QC, C L Hughes SC and M A Williamson, for the first respondent M D Hinson, with A N S Skoien, for the applicant/second respondent G J Gibson QC, with R S Litster, for the second to fourth co- respondents/first to third applicants No appearance by the third respondent SOLICITORS: MacDonnells Law for the first respondent SB Wright & Wright and Condie for the applicant/second respondent Hopgood Ganim for the second to fourth co-respondents/first to third applicants No appearance for the third respondent [1] HOLMES JA: I agree with the reasons of Muir JA and the order he proposes. [2] MUIR JA: Introduction Mackay City Council applies in proceedings 11862 of 2007 for leave to appeal against a decision of the Planning and Environment Court allowing an appeal against the Council's refusal of an application for a development permit for a material change of use of land. The Land is in Nindaroo, one of Mackay's northern suburbs. The proposed use is for a shopping centre, service station and a catering shop and concerns a 2.9265 ha area of a parcel 7.145 ha held by the first respondent, Australian Capital Holdings Pty Ltd ("ACH"). The proposed development has a floor area of 5,360m2 consisting of: (a) A supermarket of 3,200m2 ; (b) Speciality shops of 1,115m2 ; (c) A health centre of 755m2 ; (d) A fast food outlet of 25m2 ; and (e) A service station of 40m2 . [3] The second, third and fourth respondents to the Council’s application, which I will refer to collectively as the Eulcom interests, also seek leave to appeal against the decision in proceedings commenced by them, CA 11897 of 2007. ACH and the Council are respectively the first and second respondents in those proceedings. [4] The Land is bounded on its northern side by Wallmans Road and has a frontage on its eastern side to the Mackay-Bucasia Road. On the eastern side of the Mackay- Bucasia Road is the Northern Beaches Shopping Centre (“the Northern Beaches Centre”), the owners and developers of which are the second and third respondents. The fourth respondent owns the Hibiscus Shopping Centre in Bucasia. [5] The Northern Beaches Centre, which in various documents is also referred to as the Rural View Major Neighbourhood Centre, was established after Council approval in February 2002. It commenced trading in December 2003 and a development application was made in April 2006 to expand its size to 10,000m2 by: -- 3 of 21 -- 4 (a) Increasing the existing supermarket by 1,000m2 to 3,500 m2 ; (b) Increasing the specialty shops by 1,400 m2 to 2,500 m2 ; (c) Including a discount department store of 4,000 m2 . [6] The Northern Beaches Centre, as expanded in accordance with this or future applications, will be referred to as “Eulbertie Park”. [7] In paragraph 10 of his reasons the learned primary judge remarked that the success of the application to permit the Centre’s expansion could "reasonably be anticipated". He explained that it was in contemplation that the Centre’s existing Bi-Lo supermarket, when expanded, would become a Coles supermarket and that the discount department store proposed for the Centre would be a Big W. It is ACH’s intention that a Woolworths supermarket be constructed on the Land. The primary judge found that there was no room for a Woolworths supermarket in the Northern Beaches Centre even after its expansion consequent upon the current application1 . [8] ACH’s application was made to the Council on 13 March 2006, during the currency of the 1999 planning scheme. On 15 March 2006 the Council adopted the 2006 Planning Scheme which came into force on 24 March 2006. ACH’s application was required to be determined under the 1999 Scheme but the primary judge held that, nothing of significance turns on whether the application is assessed under the earlier or later regimes. For present purposes there is little material difference between the schemes and the content of the 2006 Scheme was plainly relevant.2 The issues at first instance [9] Before the primary judge the principal issues were or were in respect of: (a) Whether there were conflicts and, if so, the extent of the conflicts between the application on the one hand and the 1999 Scheme and the 2006 Scheme on the other; (b) Whether, if there were conflicts, were there nevertheless sufficient grounds to justify approval. [10] It was found that there were conflicts but that there were sufficient planning grounds to justify approval. Summary of the Council’s grounds of appeal [11] The applicants contend that the reasons disclose that the primary judge erred in law: 1. In concluding that the offer by ACH to construct and dedicate the Wallmans Road deviation was a planning ground of considerable weight; 2. By substituting for the planning strategies adopted by the Council, as the planning authority, in the 1999 and 2006 Schemes, planning strategies which he considered to be preferable or more appropriate; 3. In concluding that the satisfaction of community need for a new supermarket and a new road balanced the conflict with the 1999 Scheme's Strategic Plan and the 2006 Scheme. 1 Reasons, paragraph [10]. 2 Yu Feng Pty Ltd v Maroochy Shire Council [2000] 1 Qd R 306 at 328; Lewiac Pty Ltd v Gold Coast City Council [1996] 2 Qd R 266 and Integrated Planning Act 1997 (Qld) s 4.1.52. -- 4 of 21 -- 5 [12] The Eulcom interests also contended that the primary judge erred in law, failing to have any or any proper regard to the impact of the proposal on residential amenity. Relevant provisions of the 1999 and 2006 Schemes [13] The Strategic Plan in the 1999 Scheme established a hierarchy of centres as follows: "Commercial Areas Description This land use allocation includes all forms of commercial and retail use at Regional, Sub-Regional Major Neighbourhood and Neighbourhood Centres throughout the City. Intent This land use allocation is intended to provide for a range of commercial centres appropriate to the needs of the City. In order that the widest range of goods and services can be provided to residents and to ensure the ongoing viability of centres, a hierarchy of centres is intended. The hierarchy of centres is shown on Strategic Plan Maps 1-4. It is intended that only one centre is developed in each of the nominated suburbs. The CBD area is shown on Figure 3. The hierarchy of centres is as follows: (1) Regional Centre The Mackay CBD and frame area is intended to remain the predominant centre in the City and the region. A consolidation of highest order shopping and entertainment facilities, commercial services and government and professional offices is envisaged. Urban design measures which sustain and enhance vital, attractive and pedestrian orientated public spaces and facilitate accessibility will be encouraged, Council will provide clearer direction for development in this area through a future City Centre Local Area Plan. (2) Sub-Regional Centres [sic] The Mt Pleasant Shopping Centre and adjoining commercial areas is intended as a sub-regional centre to principally service areas north of the Pioneer River. The sub-regional centre is intended to provide mainly comparison and speciality shopping functions, and provide a focus for other commercial, medical and service users. (3) Major Neighbourhood Centre It is intended that a Major Neighbourhood Centre be established at Nindaroo to service as a focus for employment and service provision for the neighbourhoods north of McCready's Creek. This centre would provide facilities to cater to the weekly shopping trip together with a wide range of personnel and community services and facilities. A total retail floor area of up to 10,000 m 2 is -- 5 of 21 -- 6 ultimately envisaged at the Nindaroo centre including a discount supermarket. (4) Neighbourhood Centres Indicative locations for the development of neighbourhood centres are shown on Strategic Plan Maps 1-4. These are at Bucasia, Blacks Beach, Walkerston, Andergrove, North Mackay, West Mackay, Ooralea, Seaforth, Midge Point and Bakers Creek (south). These centres are intended to provide a focus for the establishment of accessible neighbourhood shopping and community facilities which meet the needs of the residents in nearby suburbs. A total retail floor area of 5,000 m 2 is envisaged at these centres, comprising a discount supermarket and speciality stores. (5) Convenience Centres These centres, not able to be shown on the Strategic Plan Maps due to scale limitations, are intended to provide accessible convenience service needs and a community focus for immediately surrounding residents. They are not intended to provide sufficient range or depth of merchandise to fully cater for the weekly shopping trip. A total retail floor area of 500-1,500 m2 is envisaged at these centres, comprising an accessible convenience supermarket and speciality stores." [14] The 2006 Scheme also makes provision for a hierarchy of centres which closely corresponds with the provisions under the 1999 Strategic Plan. The 1999 Scheme explained under the heading “Application of the Planning Scheme”: "This transitional planning scheme is intended to promote confidence amongst residents, public authorities and developers by providing clear guidelines about future development and use of premises within the City’s urban and rural areas. It aims to encourage orderly and sound growth while having proper regard to issues of environmental quality, community needs and benefits, and choice." [15] It was a requirement of the Scheme that: "All development carried out … must be, to the Council’s satisfaction, in accordance with the relevant provisions of … the Strategic Plan." [16] It was stated under the heading "Intent and Requirements for Development in Zones" in respect of the Rural Zone: "Neither rural residential or park residential development nor the establishment of essentially urban uses, such as offices, shops and other commercial uses, is generally considered appropriate on land -- 6 of 21 -- 7 throughout the zone. Any proposal for rural residential, park residential or urban development is unlikely to be approved." [17] Section 7.4 provided: "7.4 Consideration of Applications Without limiting its discretion, the Council shall, before determining an application, take into consideration any or all of the following matters as relevant to the application: (1) The provisions of this transitional planning scheme, including the Strategic Plan and any applicable Local Area Plan; … (4) The character of the proposed premises development in relation to the character of premises on adjoining land and in the locality; (5) The existing and future amenity of the neighbourhood and the likely impact of the proposed development on that amenity;" [18] The 2006 Scheme adopted the hierarchy of centres established by the 1999 Strategic Plan. It introduced its discussion of the hierarchy as follows: "A network of centres based on roles and functions and meeting the needs of the City and the region has been established. The City provides a wide range of facilities and services from its centres to meet the needs of the population of the City, and the Whitsunday and hinterland areas. However, a sustainable balance is required between the development of the City’s centres and the needs of the growing City and regional populations by managing the character, rate, scale and intensity of in each centre. " [19] These explanations of the retail hierarchy were provided: "To establish and maintain a viable and sustainable network of centres in the City, additional centre activities are situated within or immediately adjacent to a designated centre and be appropriate in their scale, intensity and character to the intended role and function of the designated centre. . . . To achieve their intended roles and functions, the designated centres are situated at key locations within the City’s transport infrastructure. Development of centre activities occurs on sites with safe and convenient access to appropriate transport infrastructure that meets the needs of the proposed activities." [20] The plan for a network of centres "according to a hierarchal arrangement" continued in Part 3 "Desired Environmental Outcomes" where it was observed: -- 7 of 21 -- 8 "(v) the growth of centres occurs in step with demonstrated community need, recognising the role and function of other centres within the network of centres." [21] In Part 5 Division 6 of the Scheme, dealing with the McCready’s Creek precinct which encompasses the Land and the Northern Beaches Centre, specific provision was made for a network of centres within the area including "a major neighbourhood centre at Rural View to meet the needs of the community." [22] Division 8 of Part 5 made further provision for the functions to be served by centres within the commercial zone and "Rural View" was identified as a "Major Neighbourhood Centre." Under the heading "Specific Outcomes" and the sub- heading "McCready’s Creek Precinct" it was provided: "New shopping facilities in the McCready’s Creek precinct are limited to a Major Neighbourhood Centre at Rural View and a Neighbourhood Centre at Andergrove and local centre functions which respect the surrounding built environment." [23] Other parts of the Table dealt with proposed increases in size of the Northern Beaches Shopping Centre as population increased. The primary judge’s approach [24] After a general narrative the reasons quote the provisions of the 1999 Strategic Plan set out in paragraph [12] above.3 The corresponding provisions of the 2006 Scheme are also quoted, as is a table from the 2006 Scheme which contains a proposed plan for the expansion of "the Rural View Major Neighbourhood Centre" in order to meet demands imposed by increased population. A sliding scale in the Table contemplated that if the number of households in the "trade catchment" exceeded 10,000 the total gross floor area of the Centre should be a maximum of 20,000m2 .4 [25] The next topic discussed is "need for the proposal". The reasons refer to the population growth in North Mackay and note that: "Among the economic experts, there was agreement that: ‘There will be a need for two full-line supermarkets at the Major Neighbourhood Centre at Rural View in the future, however, there is dispute in relation to timing and possible locations. A second full-line supermarket would necessitate more than 10,000 sq.m of retail floorspace being designated by Council within the Rural View Major Neighbourhood Centre, assuming that the Eulcom Development Application is approved.’" [26] It is pointed out that if Eulcom’s application for an expansion of the Northern Beaches Shopping Centre is successful, the maximum amount of retail floor area available of 10,000m2 would not be sufficient for a Woolworths’ supermarket to 3 Reasons, paragraph [6]. 4 Reasons, paragraphs [7] and [8]. -- 8 of 21 -- 9 be accommodated in the Centre.5 It is held that a demand for a Woolworths supermarket at Rural View “(if no other competitor of Coles emerges) may be taken to be well established.” His Honour observes shortly afterwards that, “It may be that there was a lack of foresight from the point of view of establishing competition between major supermarket operators . . .” [27] The primary judge remarked that the evidence of Mr Duane, an expert called by ACH, was “persuasive” and concluded that the court should not "be troubled by concerns that the development of a Woolworths full-line supermarket" would be premature.6 It was said of the evidence of expert witnesses called on behalf of the Council and the Eulcom interests that: "They contended that the following ‘community disbenefits’ would accompany the ACH proposal: (a) fragmentation of the Major Neighbourhood Centre; (b) duplication of facilities, rather than expanding and enhancing what would be available to the Northern Beaches community in an integrated development; (c) it ‘would inhibit and delay the development of the Neighbourhood Core and Frame Land in the Eulbertie Park approved Plan of Development’. " [28] Particular reference was made to the evidence of one of these witnesses, Mr McCracken, to the effect that persons wishing to patronise the Woolworths supermarket in preference to the Coles would not use "the designated major Neighbourhood Centre; visits there by them as potential customers of the specialty stores would not occur [and] a likely consequence [would be] some reduction in the range of specialty store operators …" 7 [29] The primary judge remarked that Mr McCracken’s evidence criticising ACH’s proposal as " 'creating another focus within what is supposed to be a neighbourhood centre on the other side of a fairly busy road [especially when] there’s no need to' … was somewhat blunted by his having expressed a contrary view as an expert in another matter." The judge then observed that it "would be unfair" to regard the situation in relation to the Northern Beaches Centre as comparable to the other centre the subject of Mr McCracken’s earlier evidence. It was concluded however that "there is enough similarity to indicate that judgments about these matters may legitimately vary" and that the point was "a fine one". The primary judge referred to evidence given during the hearing of supermarkets, such as the proposed Woolworths operating across the road from another shopping centre in circumstances in which the supermarket and the shopping centre appeared to be trading successfully. His Honour concluded, "Of itself, that has no implications for this appeal."8 5 Reasons, paragraph [10]. 6 Reasons, paragraph [11]. 7 Reasons, paragraph [13]. 8 Reasons, paragraph [15]. -- 9 of 21 -- 10 [30] It was stated that the "case against" waiting until a Woolworths supermarket could be accommodated in the Northern Beaches Centre was that it would not be possible after further expansion of that Centre to provide the "parking close by and quick ingress to the supermarket which may be one’s sole destination for shopping on the occasion, followed by quick egress" available at the presently existing Bi- Lo, the proposed new Coles and the proposed Woolworths on the Land. His Honour concluded that the proposed Woolworths should enjoy similar success "to the stand-alone Woolworths supermarket at Andergrove", a nearby suburb9 and that the ACH proposal would offer shopping convenience which was lacking at a large Major Neighbourhood Centre, catering, for example, for "shoppers whose sudden need is for caviar or some specialist cheese."10 [31] It was queried whether the Council’s approach "in confining commercial development at Rural View to the [Northern Beaches site] might, in theory have been inadvertent." That possibility was then dismissed by reference to the Council’s written response to a submission in 2005 by ACH concerning its proposal for the Land. In the relevant part of that response quoted in the Reasons, the Council stated: "This shopping - commercial centre was and is designed to meet the needs of all the residents in the area (including planned residential development to the west of the Bucasia Road). There is no intention or another shopping centre in the commercial hierarchy in this area. It is also not a good planning outcome to have shopping facilities straddling a major road. This usually makes it difficult for pedestrians to access both centres at the same time and forces people to get in their car to go from one to the other thus exacerbating traffic movements in the area. There is no merit from a planning point of view to encouraging this type of un-planned development." [32] The Council’s letter was criticised as not being "a thorough-going response” to the detailed submission. The road separation point was acknowledged by his Honour to be "undoubtedly a respectable one, but not necessarily, so far as the court is concerned at least, compelling." In this regard the primary judge explained:11 "The evidence in the case is that the 'centres' here would operate separately, that those who would access both centres on a single trip would be few and far between. The Council’s quoted response does not really come to grips with how to provide a second full-line supermarket in the area; nor does it bespeak acknowledgment that growth of this part of the city appears to have been at a rate that made questionable the sufficiency of provision of centres adopted in the 1990s without expansion." [33] The Reasons proceed to point to the convenience for commuters returning home from the Mackay City area after a day’s work in being able to turn left into a Woolworths supermarket on the Land rather than having to turn right across the Mackay-Bucasia Road into the Northern Beaches Centre. The primary judge 9 Reasons, paragraph [15]. 10 Reasons, paragraph [16]. 11 Reasons, paragraph [18]. -- 10 of 21 -- 11 considered that such convenience was a "significant factor in favour of the … application." He also appeared to regard it as significant that unless the ACH proposal was implemented, "determined Woolworths…customers" would face "an additional round trip of 13 km or so to Mount Pleasant or Andergrove." [34] Referring to reliance by the Council and the Eulcom interests on the fact that the 2006 Scheme, in relevant respects, was largely a repetition of the 1999 Scheme, the primary judge observed, "One must wonder why, legally or logically, repetition confers additional potency." 12 [35] The next topic discussed in the Reasons is ACH’s proposal for the re-alignment of Wallman Road.13 The alignment favoured by the Council differed markedly from that proposed by ACH. The primary judge favoured the evidence given in this regard by the traffic engineer called by ACH. [36] Paragraph [24] of the Reasons contains a discussion of the bearing on the success of a rezoning application of the proposal’s adverse impact on residential amenity. The primary judge observed in that regard14 : "… the court should not lightly give its imprimatur to the destruction or impairment of residential amenity which planning scheme provisions understandably set out to protect. ACH’s difficulty here is that its proposed site is a broad tract of land whose suitability for the proposed development is qualified by the long established presence of residences on Lots 9 and 11 on blocks which on three sides are surrounded by the site." [37] After discussing earlier Planning and Environmental Court decisions involving the 1999 Scheme, the primary judge concluded that the Council’s intention that the Major Neighbourhood Centre be located east of the Mackay-Bucasia Road has always been clear. Reference in that context was made to a plan of development of the Eulcom land under which it is proposed that retail and commercial facilities be developed on that land by way of expansion of the Northern Beaches Centre to service the Northern Beaches suburbs. The document, as the primary judge observed, has the status of a preliminary approval under s 3.1.6 of the Integrated Planning Act 1997 (Qld), "having the potential to override general planning arrangements for the City." [38] The Plan of Development included the following:15 " The Neighbourhood Centre Core, the area shown as such on Map 1, shal1 be developed as the main shopping centre for Eulbertie Park and for all of the Northern Beaches suburbs of Mackay. This area shall include the main shopping centre for the Northern Beaches, and also complementary activities that will add to the vitality and range of services of the centre. It is in the neighbourhood centre core that the main objectives identified in the Mackay Strategic Plan for the Northern Beaches Major Neighbourhood Centre will be met. The 12 Reasons, paragraph [20]. 13 Reasons, paragraphs [21,] [22] and [23]. 14 Reasons, page 31. 15 Reasons, page 36. -- 11 of 21 -- 12 neighbourhood centre core’s location on the south-east quadrant of the junction of the Mackay-Bucasia Road with the proposed Eimeo Road re-alignment provides a prominent and accessible location for these facilities that are to provide for the district-level needs of Northern Beaches residents. … The vitality and convenience sought for the Major Neighbourhood Centre will be achieved only if all higher order commercial and retail facilities serving the Northern Beaches Area are concentrated into this Neighbourhood Centre Core, to the exclusion of other parts of the Plan of Development Area, and nearby areas outside the Plan of Development Area, and the Plan of Development provisions are structured to achieve that end. To encourage a cohesive form of development to take place in the neighbourhood centre core, it is intended that most development is code assessable against the relevant codes in this Plan of Development." (emphasis added) [39] The primary judge found that there were conflicts between the application and Scheme provisions in that: "[32] … (a) that the proposed development is 'out of centre' development which is inconsistent with the centres strategy; … … (d) the type, intensity and scale of uses included in the proposed development goes well beyond the non-residential uses contemplated by the Urban Residential PDLU Designation." (footnotes omitted) [40] In the course of discussing the first of such conflicts the primary judge observed:16 "The evidence in this appeal tends to establish that the Mackay planners’ estimates of the use areas required to provide retail services in various categories considered necessary or appropriate in the marketplace are sadly deficient. Players in the market are more greedy for space than may have been the case in earlier years. Customers’ expectations have inflated accordingly. That said, there are clear indications in the Strategic Plan that out of centre retail development is frowned upon, subject to the exception for ‘convenience centres...not able to be shown on the . . . Maps due to scale limitations.’ ACH’s proposal, as summarised in the planners’ reports is a supermarket of 3,200m2 , specialty shops with GFA of 1,115m2 (Mr Brown) or 1,152m2 (Mr Schomburgk), a health centre of 755m2 , a fast food outlet of 250m2 and a service station with four fuel bowsers (40m2 ), for an agreed total floor area of 5,360m2 , exceeding what the Strategic Plan contemplated for a Neighbourhood Centre. Whether the ground level car parking for 345 cars proposed was sufficient was an issue which went away. 16 Reasons, pages 39 – 40. -- 12 of 21 -- 13 The conflict which I find to exist, that this proposal is three or more times the size of what the Strategic Plan contemplated by way of out of centre development is not alleviated by anything in the 2006 Planning Scheme." [41] The primary judge’s conclusions are stated in paragraphs [37] and [38]. In the primary judge’s opinion there was much to be said for the proposition that “the 1999 planning arrangements, although now relevantly replicated in the 2006 ones, have been overtaken by events.” The primary judge appears to mean by this observation that the provisions of the Scheme did not sufficiently anticipate the need for a Woolworths supermarket at the Northern Beaches Centre within an acceptable timeframe. The reasons speak of a failure to provide "the shopping/commercial facilities which are acknowledged in the aspirational statements which introduce them at the levels which those residents have come to expect, in light of prevailing retailing standards and practices." [42] However, consideration of the Reasons makes it plain that the primary judge’s focus was limited almost entirely to the absence of a free-standing Woolworths supermarket on the west of the Mackay-Bucasia Road accessible to homeward- bound commuters who would encounter no parking inconveniences. The primary judge expressed a lack of confidence in the ability of the Northern Beaches Centre to provide "the relevant facilities within an acceptable timeframe". What timeframe was acceptable in the primary judge’s view was not identified expressly. He took into consideration that the "ACH proposal has the advantage of being ‘ready to go’". As to whether a present need for such a supermarket had been established, it was held, "It is not premature, unless to a very minor extent …". A little later17 the primary judge considered that unless the ACH proposal was approved the "genuine community need" for such a proposal would be "likely to go unmet for several years." [43] He considered the possible adverse effect of the ACH proposal on the existing or expanded Northern Beaches Centre and concluded that there would not be "any unacceptable impact". He explained that the Northern Beaches Centre would, "reap the benefits of its greater size, the new discount department store and community facilities located close to it such as the primary school, the new police station and the proposed new high school to the south." [44] The primary judge implicitly acknowledged the existence of "adverse traffic impacts" from the location of the ACH development across the road from the Northern Beaches Centre but doubted whether such impacts would be "significant in practice". [45] It was concluded that construction of the Wallmans Road deviation on what the primary judge considered to be the most suitable alignment "at no cost to the rate payers" was a planning ground of considerable weight. He then identified the ACH proposal as providing for "a convenience-based centre serving predominantly existing and future residents on the western side of Mackay- Bucasia Road and the travelling public heading past the site, notwithstanding its considerable size.” Referring to the evidence of a planner who was called by ACH, his Honour commented that it may be right that, "Although the Centres will 17 Reasons, paragraph [39]. -- 13 of 21 -- 14 operate separately, the proposal may complement Northern Beaches (Centre), consolidating retail facilities around this ‘node’, thereby creating a community focus and reinforcing this location as comprising that node."18 [46] In paragraph [40] of the reasons the primary judge noted his consciousness of the fact that the Mackay Planning Scheme, unlike others, does not encourage "nodes" but discourages them. He observed: "The Court is not entitled to usurp the Council’s planning function. The importance of centre hierarchies has frequently been acknowledged … such hierarchies promote orderly development; they offer certainty, which it is hoped, enables developers and others (whose wishes may be to escape development and its impacts) to make their plans for the future." [47] Referring to earlier planning decisions the primary judge noted that the Council had not taken "a similarly flexible approach to its transitional planning scheme" to the approach taken by the local authorities in those cases. The primary judge continued: 19 "The ‘market responsive’ flexibility introduced by the IPA was described by Davies JA (the other members of the Court of Appeal concurring), in Vynotas Pry Ltd v Brisbane City Council [2002] 1 Qd R 108 at 113: ‘[15] In any event, the scheme of the Integrated Planning Act appears to be that, so far as it applies to development and use of premises, a traditional planning scheme no longer has binding force but is of persuasive relevance only. Thus s.2.1.23 provides that a local planning instrument, which includes a planning scheme, may not prohibit development on, or the use of premises; and more specifically s.6.1.2.3(3) provides that a prohibited use in a former planning scheme is taken to be no more than an expression of policy that the use is inconsistent with the intent of the zone in which the use is prohibited. These provisions relate only to prohibitions, but if prohibitions in former planning schemes are now no more than policy statements it is unlikely that the legislature intended any other provisions in such schemes to continue to have binding effect upon development applications under the Act.’" (footnotes deleted) [48] The primary judge then concluded that ACH had satisfied its onus and explained,20 "To balance the conflict noted, ACH can point to its proposal satisfying community needs for the new supermarket and for the new road." [49] As something of an aside the primary judge noted that his conclusions had been reached "without reference to certain other benefits the proposal offers". The new petrol outlet contemplated by the ACH proposal, which was subject to "regulatory hurdles" being surmounted, was identified as an advantage. 18 Reasons, paragraph [39]. 19 Reasons, paragraph [44] – [45]. 20 Reasons, paragraph [41]. -- 14 of 21 -- 15 Consideration of conditions in the Reasons [50] The reasons then proceed to discuss the conditions which ought be imposed in respect of the approved development recording the primary judge’s expectation that conditions would be able to be imposed which would satisfy "the requirements of the Urban Residential PDLU in respect of amenity." The reasons then turn to a consideration of the impact of the development on the homes on Lots 9 and 11. Each of those lots intrudes into the ACH development from Wallmans Road and shares three common boundaries with the Land. Plainly, the construction of ACH’s development on the Land has the potential to markedly detract from the residential amenity of Lots 9 and 11. The primary judge recognised this and discussed it in some detail. After stating his intention to allow such residents time in which to make submissions to the Court, the primary judge observed:21 "I confess to considerable uncertainty as to what the amenity impacts might be, and note that even Mr King, when pressed by Mr Litster to indicate what would be the visual impacts for Lot 11, had no idea. My impression has been that the impugned 2.4 metre side and rear fences, which certainly exceed in height an (assumed) standard 1.8 metre fences, but may well not be unusual in Mackay, will be set back some 4 metres into the ACH site, the area thus fenced off to be vegetated, presumably to provide additional screening. I am unclear as to the proposed nature and extent of the vegetation proposed, and arrangements that can be reliably put in place to maintain it. Perhaps all of this can be dealt with in the exercise of settling development conditions. I have given thought to requiring, should the owners of Lots 9 and 11 together seek it, that the appellant make some provision toward the reasonable cost of engaging for them a suitable consultant able to advise on the impacts with which the Transitional Planning Scheme is concerned and suitable means of attenuating them to acceptable levels. It may well be that some satisfactory resolution could be reached with Mr King, perhaps with the assistance of the mediation services the Registrar of the court is in a position to provide." [51] After further discussing the evidence of Mr King, the primary judge observed that the cross-examination of Mr King "revealed a troubling amount of uncertainty about the ACH proposal which renders assessment of its amenity impacts on adjoining residences impossible for the moment". [52] This part of the reasons occupies paragraphs [43] to [59] inclusive. In paragraph [58] the primary judge said: "The information before the Court is inadequate to permit assessment of amenity impacts in which any confidence could be reposed. These are matters of considerable concern to the Court. At this stage in the appeal, I think it appropriate to proceed on the basis that Mr King or other consultants independent of ACH (and potentially including consultants in the visual amenity field) should in principle be able to devise conditions dealing with amenity impacts in a 21 Reasons, paragraph [53]. -- 15 of 21 -- 16 satisfactory way … This aspect of the development proposal is of such concern to the Court that it is possible that the lack of suitable enforcement conditions would go to the heart of things to such an extent that the proposal ought not be allowed to proceed." [53] The reasons then state, "as indicated in paragraph [41], the appeal will be allowed, in the expectation that suitable conditions to protect the legitimate amenity impacts on the development’s immediate neighbours can be formulated." 22 Relevant authorities and statutory provisions [54] Section 4.4(5A) of the Local Government (Planning and Environment) Act 1990 (Qld) provides: "(5A) The local government must refuse to approve the application if— (a) the application conflicts with any relevant strategic plan or development control plan; and (b) there are not sufficient planning grounds to justify approving the application despite the conflict." [55] The Council and the Eulcom interests place great reliance on the following passage from the reasons of White J, with which Thomas and Williams JJA relevantly agreed, in Grossman v Council of the City of Gold Coast:23 "[38] The proper approach of the Planning and Environment Court and of its predecessor, the Local Government Court, to matters of planning policy has long been recognised as one of restraint. Most recently this Court affirmed the desirability of a self-limiting approach, at least when considering town planning matters in Holts Hill Quarries Pty Ltd v Gold Coast City Council [2000] QCA 268 unreported decision of 14 July 2000. The Court quoted with apparent approval at [42] the following passage from the judgment of Quirk DCJ in Elan Capital Corporation Pty Ltd v Brisbane City Council [1990] QPLR 209 at 211: "It should not be necessary to repeat it but his (sic) Court is not the Planning Authority for the City of Brisbane. It is not this Court's function to substitute planning strategies (which on evidence given in a particular appeal might seem more appealing) for those which a Planning Authority in a careful and proper has to adopt (sic) (Brazier v Brisbane City Council (1972) 26 LGRA 322 at 327). As was observed by Carter J in Sheezel v Noosa Shire Council [1980] QPLR 130 (when he then constituted this Court), it would be quite inappropriate for this Court to deal with an individual application for rezoning in a way which might be construed as determinative of some wider question. Adopting the phraseology of those cases which deal with the non-derogation principle, I feel that to allow this appeal would be to `cut across' in quite unacceptable manner, a planning strategy which has been adopted by the Planning Authority and publicly exhibited for community 22 Reasons, paragraph [59]. 23 (2001) 117 LGERA 153 at 163 – 164. -- 16 of 21 -- 17 comment." This stated a proposition which the Court said was "common sense...for which no authority was required" [46]. See also Ampol Petroleum (Qld) Pty Ltd v Pine River Shire Council [1989] QPLR 133 per Row DCJ at 134, 136; Bullock v Hervey Bay Town Council [1983] QPLR 98 per Carter DCJ at 100; Cherrabun Pty Ltd v Brisbane City Council [1985] QPLR 205 per Quirk DCJ at 208; and the discussion in Fogg, Land Development in Queensland (1987) pp 390 et seq." [56] Jerrard JA, with whose reasons McMurdo P and Philippides J agreed, summarised in the following passage of his reasons in Leda Holdings Pty Ltd v Caboolture Shire Council & Ors24 decisions on the importance of local authorities planning strategies and strategic plans and the circumstances in which a departure from them could be justified: "Those authorities were cited to show that conflict between a development application and strategic plan was often fatal to the application, even prior to the introduction of s 4.13(5A) and its counterparts in 1992. Those decisions included McLennan v Maroochy Shire Council [1990] QPLR 113 ("A Strategic Plan is of importance when assessing a rezoning application as it is a forward planning strategy, for the future development of a local authority area."); Duncombe v Caboolture Shire Council [1990] QPLR 257 ("As has been said repeatedly, this Court is not the planning authority for this area and it is my view that it would be inappropriate for the Court to approve a proposal which is squarely in conflict with the formally expressed planning strategies of that authority."); McPherson v Caloundra City Council [1990] QPLR 272 ("the Strategic Plan and the Strategic Plan Map are legitimate planning tools adopted by a Local Authority for the future planning of the Local Authority Area. The Local Authority in those circumstances is planning ahead and endeavouring to direct its future planning process in an orderly manner."); Beck v Atherton Shire Council [1991] QPLR 56 ("The Court has however, repeatedly stressed the importance of strategic planning and the need to respect and support the integrity of the important planning tool which the Strategic Plan is. There may be cases where a departure from the Strategic Plan could be justified; where, for example, the planning strategies which it represents, having been overtaken by events (or for some other reason), clearly no longer have any application; or where it can be demonstrated plainly the land has been given a designation on the basis that was and remains invalid"); Bowden & Ors v Brisbane City Council & Anor [1991] QPLR 271 ("The significance of strategic planning, particularly on rezoning applications, has been recognised by the Court on many occasions. Since the forward planning documents of a Local Authority are indicative of the intent of a planning authority as to the future preferred form of development that it sees for its Local Authority area, considerable weight ought to be given to the provisions of forward planning documents of a Local Authority." (footnotes deleted) 24 [2006] QCA 271 at 9 – 10. -- 17 of 21 -- 18 [57] To these references may be added the following observations of Keane JA, with whose reasons the other members of the Court agreed, in Clark & Ors v Cook Shire Council:25 "The terms of a planning scheme inevitably reflect the striking of an overall balance, in the public interest, between the many interests potentially affected by the planning scheme. It is important not to minimise the force of this consideration. In the striking of the overall balance in a planning scheme, there will be "winners and losers" so far as individual interests are concerned." [58] The importance of the hierarchy of retail shopping centres or precincts established by planning schemes and the necessity of not acting so as to prejudice the viability of the established hierarchy has been recognised in a number of planning decisions. In Lewiac Pty Ltd and ING Real Estate, Joondalup BV v Gold Coast City Council & Ors26 Newton DCJ observed: "[15] It does not appear to be in dispute that the achievement of a sustainable and effective centre hierarchy should be recognised as a good town planning principle for reasons of orderly development, increased accessibility and convenience, greater economic efficiency and investment opportunities. … [16] It may be accepted then, that a centre hierarchy is vital to the functioning of a City in order to ensure the efficient, equitable and adequate provision of goods and services to all communities having regard to their needs, size and location." [59] Newton DCJ referred with approval to passages from the reasons of Quirk DCJ in Wilispap Pty Ltd v Mulgrave Shire Council27 and in Overton & Anor v Redcliffe City Council & Anor.28 In Wilispap Quirk DCJ, referring to the potential impact of an application, after remarking that it would "prejudice the feasibility of the hierarchy of shopping facilities proposed by the plan" said, "In a matter of this kind, it would, in my view, be entirely inappropriate for this Court to make a decision which runs contrary to such a considered and carefully expressed planning strategy of a local authority." In Overton Quirk DCJ drew attention to the fundamental importance of such provisions to "a suitable and order hierarchy of commercial development" and commented that "to ignore these provisions could have fundamental and far-reaching consequences for expectations based on the Strategic Plan as it is presently drawn." 29 Consideration of the merits of the grounds of appeal [60] The primary judge, having concluded that there were conflicts with "relevant strategic plan(s)" was required to decide if there were "sufficient planning grounds to justify approving the application despite the conflict." In this case that exercise required the identification of "planning grounds"; an assessment of the role and importance to the planning scheme of the provisions which would be infringed 25 (2007) 152 LGERA 420 at 431. 26 [2003] QPELR 385 at 389. 27 [1992] QPLR 51 at 52 – 53. 28 [2000] QPELR 250 at 253. 29 [2000] QPELR 250 at 253. -- 18 of 21 -- 19 should the application be approved; the adverse consequences, if any, which might flow from such infringement and the competing merits and weight of the planning grounds relied on to justify approval. Also relevant were the matters in s 4.4(3) of the Integrated Planning Act 1997 (Qld). [61] One matter of obvious relevance to this process of evaluation was the impact of the proposal on the amenity of residential development. The primary judge recognised the importance of amenity considerations in paragraph [24] of his reasons but only in a theoretical way. He failed to take residential amenity into account, however, when evaluating the sufficiency of the planning grounds found to be relevant. That constituted an error of law. [62] It may be seen from paragraphs [43] and following of the reasons that the primary judge’s approach was to regard the impact on residential amenity as a matter to be addressed by conditions but, as his Honour dwelt upon the matter further, he concluded that he had insufficient evidence "to permit assessment of amenity impacts in which any confidence could be reposed". He even contemplated the possibility that it may be impossible to devise appropriate conditions, in which event, "the proposal ought not be allowed to proceed." [63] In my view the primary judge also erred in law in considering the Wallmans Road deviation favoured by ACH as a "planning ground . . .of considerable weight". The proposal for the road favoured by the primary judge was only relevant to ACH’s proposed development. The deviation planned by the Council contemplated that the Land retain its existing zoning and did not accommodate ACH’s proposed development. The developer’s proposal was not one which the Council, as the planning authority and the relevant road authority, favoured. And it could scarcely be said that the fact that a developer was to meet the cost of a road deviation made necessary by its application for development approval was a planning ground which could assist in overcoming conflict between the town planning scheme and the development. [64] Much of the argument advanced on the hearing of the appeal concerned the alleged failure by the primary judge to give due consideration to the provisions of the Schemes and to the principles discussed in authorities such as Grossman, Leda, Lewiac and Wilispap. Counsel for ACH referred to the primary judge’s references to the authorities and the principles established by them. He submitted that careful perusal of the reasons showed that the primary judge approached his task by reference to those principles and s 4.4(5A) in an orthodox way. It was urged that the primary judge was entitled on the evidence before him to find the existence of “planning grounds” and that the weight to be attached to them was a matter for him. [65] There is no doubt that the ACH proposal involved a very substantial departure from the requirements of the Schemes. The development proposal: (a) Conflicted with the 1999 and 2006 Schemes in that it provided for “out of centre development” some three times larger than contemplated by the Schemes. (b) Conflicted with the Schemes’ objectives that: the Northern Beaches Centre be “the third major focus for shopping community and commercial needs in -- 19 of 21 -- 20 the City,” that it grow “in step with and respond(s) to the convenience orientate needs of the … precinct” and that “only one centre [be] developed in each of the nominated suburbs.” (c) Conflicted with the Schemes’ aim of encouraging “orderly and sound growth” and of promoting “confidence amongst residents, public authorities and developers by providing clear guidelines about future development.” (d) Impinged on the purpose of the retail hierarchy established by the Schemes of establishing and maintaining a viable and suitable network of retail and commercial centres …” (e) Had the disadvantage, acknowledged by the primary judge as “a respectable one”, of being separated from the Northern Beaches Centre by a busy road. The primary judge dismissed the traffic problems so arising by concluding that separation should not prove a significant problem as the new centre would operate separately and those wishing to visit both centres on a single trip would be “few and far between”. That explanation, having regard to Woolworths’ position in the supermarket hierarchy, accepts the likelihood of a material erosion in trading at the Northern Beaches Centre. It also fails to give due consideration to the proposal’s conflict with the Scheme provisions. [66] The reasons suggest that the primary judge failed to appreciate the significance of the Eulbertie Plan of Development which he noted prevails to the extent of any inconsistency with the 1999 or 2006 Schemes, and which may be seen as part of a process of orderly implementation of the provisions of the 1999 Scheme. The assertions in the Plan of Development emphasised in paragraph [36] above are of particular relevance to ACH’s proposal. [67] The primary judge’s observation to the effect that repetition of provisions of a superceded Scheme in a new scheme does not confer “additional potency” on those provisions may be right in a sense but it fails to acknowledge the benefits of consistency and predictability and their bearing on the expectations of the Local Authority, residents, developers, and the business community, particularly where orderly development is proceeding in accordance with such provisions. [68] The reasons also suggest that the primary judge either failed to appreciate that the Schemes and the Eulcom Plan of Development were sufficiently flexible to permit the Northern Beaches Centre to be expanded to incorporate a new supermarket, subject to obtaining requisite approvals, or that short term expediency was preferred to the carefully devised shopping precinct structure established by the Schemes and partially implemented under the Eulbertie Plan of Development. In that regard his Honour may have been influenced by his belief that the lack of present competition for the Bi-Lo supermarket which was to be “rebadged” to Coles was something to be deplored. The Council’s senior counsel submitted that the establishment of competition between major supermarket operators was not a planning objective. No submission was made to the contrary. On more than one occasion the primary judge questions the sufficiency of the provisions made in the Schemes for retail development in the subject locality and asserted or implied that the Schemes had been “overtaken by events”. But a new scheme had just been -- 20 of 21 -- 21 adopted and there was no evidence that its provisions were based on inadequate or erroneous information about population, population growth, retail needs, distances between centres and travelling times to and from centres. As was submitted on behalf of the Council, some 12 hectares of land in Eulbertie Park was available for development. [69] The foregoing considerations, taken in combination, warrant the conclusion that the primary judge failed to apply the principles referred to in paragraphs [53] to [57] above and thus erred in law. [70] Because the primary judge’s conclusions were affected by the errors identified above, the decision should be set aside. As the above reasons demonstrate, the respondent failed to establish that there were “sufficient planning grounds to justify approving the application despite [its] conflict” with the subject Schemes. It is therefore appropriate that the appeal to the Planning and Environment Court be dismissed. Conclusion [71] For the above reasons I would allow the application for leave to appeal, allow the appeal, set aside the orders made below and order that Appeal No. BD 3575 of 2006 to the Planning and Environment Court be dismissed. [72] I would order that the first respondent to each appeal pay the other parties’ costs of the appeal. [73] WHITE J: I have read the reasons for judgment of Muir JA and agree with his Honour in finding that there were insufficient planning grounds to justify approval of the development application by the Judge below departing, as he did, from the well-established principle that a planning court ought not substitute its own preferred planning strategies in place of carefully developed schemes of the planning authority, particularly where the schemes have recently been reviewed. [74] I agree with his Honour that the appropriate course is to dismiss the appeal to the Planning and Environment Court since the respondent has been unable to establish that there were sufficient planning grounds to approve the application despite the conflict with the Schemes. I agree with the orders proposed by his Honour about costs. -- 21 of 21 --