Australian Capital Holdings P/L v Mackay City Council & Ors [2008] QCA 101 (2008) QPELR 606

SUPREME COURT OF QUEENSLAND CITATION: Australian Capital Holdings P/L v Mackay City Council & Ors [2008] QCA 101 PARTIES: AUSTRALIAN CAPITAL HOLDINGS PTY LTD ACN 087 497 863 (appellant/first respondent) MACKAY CITY COUNCIL (respondent/second respondent) THE CHIEF EXECUTIVE UNDER THE TRANSPORT INFRASTRUCTURE ACT 1994 (first co-respondent/third respondent) v 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) PETER SOLOGINKIN AND COLLEEN SOLOGINKIN (fifth co-respondents/fourth applicants) PAUL SOLOGINKIN AND JUDY SOLOGINKIN (fifth co-respondents/fifth applicants) FILE NO/S: Appeal No 1822 of 2008 P & E Appeal 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: 2 May 2008 DELIVERED AT: Brisbane HEARING DATE: 26 March 2008 JUDGES: Holmes and Fraser JJA and Chesterman J Separate reasons for judgment of each member of the Court, each concurring as to the orders made ORDERS: 1. Application for leave to appeal granted 2. Appeal allowed 3. Orders of 4 February 2008 be set aside, and an order be substituted that any further hearing of the issues in dispute be adjourned pending determination of Appeal No 11897/07 -- 1 of 9 -- 2 4. First respondent to pay the costs of the applicants/appellants and the second respondent Ex tempore orders of McMurdo P: 5. The parties have leave to make further submissions as to costs of the proceedings in the court from which the Application for Leave to Appeal originated, in accordance with Practice Direction No 1 of 2005, paragraph 37A. CATCHWORDS: ENVIRONMENT AND PLANNING – COURTS AND TRIBUNALS WITH ENVIRONMENT JURISDICTION – QUEENSLAND – PLANNING AND ENVIRONMENT COURT AND ITS PREDECESSORS – POWERS ON APPEAL – where judge in Planning and Environment Court allowed appeal in relation to the refusal of a development application by Mackay City Council – where appeal lodged with Court of Appeal against decision of Planning and Environment Court – where judge in Planning and Environment Court then made further orders with respect to hearing of questions concerning residential amenity issues – where judge proposed to rule on amenity question with the intention of excluding those matters from consideration by the Court of Appeal – whether in embarking on fresh hearing judge exceeded jurisdiction – whether judge failed to take into account relevant considerations Integrated Planning Act 1997 (Qld), s 3.5.14(1), s 3.5.14(2), s 4.1.56(2), s 4.1.54(2)(c), s 4.1.54(3) Transport Infrastructure Act 1994 (Qld) Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 137; [1987] FCA 312, cited House v The King (1936) 55 CLR 499; [1936] HCA 40, considered Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146; [1997] HCA 1, cited COUNSEL: D J S Jackson QC, with R S Litser, for the first to fifth applicants P J Lyons QC, with M A Williamson, for the first respondent A N S Skoien for the second respondent E M Hussey for the third respondent SOLICITORS: Hopgood Ganim for the first to fifth applicants MacDonnells Law for the first respondent SB Wright & Wright and Condie for the second respondent Crown Law for the third respondent [1] HOLMES JA: The applicants seek leave, under s 4.1.56(2) of the Integrated Planning Act 1997 (Qld), to appeal against the decision of a judge in the Planning and Environment Court to embark on a further hearing in relation to amenity issues in connection with a shopping centre development. -- 2 of 9 -- 3 Background [2] In an earlier judgment, which allowed an appeal against the refusal of a development application for the shopping centre, the learned Planning and Environment Court judge had left unresolved questions concerning the impact of the development on the amenity of neighbouring properties. His reasons for judgment were given on 15 November 2007, and the order allowing the appeal was made on 7 December 2007. On 4 February 2008, he made orders for the purposes of a hearing intended to resolve issues in dispute as to the effect of the development on the amenity of the adjoining properties. Those orders were the subject of this application for leave. (The first, second and third applicants have also sought leave, in Appeal No 11897/07, to appeal against the judgment itself.) It was common ground that if this Court were to conclude that leave to appeal should be given, it ought also to decide the appeal. The parties [3] The second respondent here, the Mackay City Council, refused the development application by Australian Capital Holdings Pty Ltd, the first respondent, which successfully appealed the refusal in the Planning and Environment Court. The first, second and third applicants, Eulcom Pty Ltd, W.A. Stockwell Pty Ltd, and Porterco Pty Ltd were co-respondents to the Planning and Environment Court appeal, as was the Chief Executive under the Transport Infrastructure Act 1994 (Qld), although he took no active part in the appeal or this application. Australian Capital Holdings’ proposed development was at Rural View, in Mackay. Eulcom and Stockwell were owners and developers of land nearby, part of which was to include a retail development, and Porterco owned a shopping centre in the vicinity. (Where appropriate, I will refer to the three companies collectively as “the Stockwell parties”). [4] Peter and Colleen Sologinkin, the fourth applicants, resided on an allotment bounded on three sides by the development, and Paul and Judy Sologinkin, the fifth applicants, lived on an allotment adjoined by it on two sides. (The land to be developed was a former cane farm out of which their lots had earlier been carved.) The Sologinkins had made submissions to the Council opposing the development application, but did not elect to become co-respondents to the appeal in the Planning and Environment Court. Appeal to the Planning and Environment Court under the IPA: [5] Section 4.1.54 of the Integrated Planning Act 1997 sets out the Court’s powers on an appeal against a decision about a development application: “(1) In deciding an appeal the court may make the orders and directions it considers appropriate. (2) Without limiting subsection (1), the court may – (a) confirm the decision appealed against; or (b) change the decision appealed against; or (c) set aside the decision appealed against and make a decision replacing the decision set aside.” Sub-section (3) clarifies the effect of the Court’s decision: “(3) If the court acts under subsection (2)(b) or (c), the court’s decision is taken, for this Act (other than this decision) to be the decision of the entity making the appealed decision.” -- 3 of 9 -- 4 The reasons for judgment on the appeal [6] In his reasons for judgment delivered on 15 November 2007, the learned Planning and Environment Court judge reviewed the relevant planning scheme provisions and the evidence as to the need for the proposed development, as well as its disadvantages. He recognised the importance of residential amenity considerations, noting that a difficulty for the developer was the existence of long-established residences on adjoining blocks (those occupied by the Sologinkins). Four possible areas of conflict with the relevant Strategic Plan had been identified, one of which was that the development “would detract from the residential amenity of the Urban Residential PDLU [preferred dominant land use] designation”. The judge found that two of the conflicts had been established, but as to the residential amenity point, merely said that an associated road was likely to have a greater impact on residential amenity than the proposal itself; consequently, non-residential uses next to the road would be preferable. That observation did not apply, he said, to the immediate neighbours of the proposal. His Honour expressed himself satisfied that Australian Capital Holdings had satisfied its onus of showing that the appeal should be allowed. It had demonstrated a community need for the new supermarket and the new road, which constituted sufficient grounds to justify approving the development, notwithstanding the conflicts with the planning scheme. [7] Although he had concluded that the appeal should be allowed and the development approved, his Honour said, the question of appropriate development conditions remained in issue. In this context he returned to the question of conflict, and expressed his expectation that - “… the conditions will ensure satisfaction of the requirements of the Urban Residential PDLU in respect of amenity.” Reviewing the submissions which the Sologinkins had made to the Council, his Honour expressed concern about the potential impact of the proposed development on their residential amenity as the occupiers of the adjoining blocks. With that concern in mind, the learned judge considered, but rejected, the possibility of imposing a condition that the developers obtain the Sologinkins’ consent to the measures to be taken to limit the impact of the development. Instead he directed that the Sologinkins be provided with a copy of the judgment and indicated a preparedness to receive further submissions from them, notwithstanding that they had not been parties to the appeal. [8] The learned judge noted that the Stockwell parties had made submissions based on the Urban Residential PDLU designation and on the emphasis, in Performance Criteria, on non-residential developments which did not detract from residential amenity. They had pointed out some limitations in the evidence of Australian Capital Holdings’ expert, Mr King (an environmental scientist) on the topic. His Honour observed that Mr King’s cross-examination - “… revealed a troubling amount of uncertainty about the ACH proposal which renders assessment of its amenity impacts on adjoining residences impossible for the moment.” He returned later to that theme: “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 -- 4 of 9 -- 5 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 satisfactory way. It may be that some level of co-operation is forthcoming from the affected neighbours. This aspect of the development proposal is of such concern to the court that it is possible that the lack of suitable enforceable conditions would go to the heart of things to such an extent that the proposal ought not be allowed to proceed. The transcript of Mr King’s evidence and the Sologinkins’ submissions indicate the subjects that will have to be addressed.” The appeal would be allowed, his Honour said - “…in the expectation that suitable conditions to protect the legitimate amenity impacts on the development’s immediate neighbours can be formulated.” Developments after the judgment was given [9] On 4 December 2007, having received a copy of the judgment, the Sologinkins wrote to the Registrar of the Planning and Environment Court, setting out a number of specific concerns about how they would be affected by the development. On 7 December 2007, Australian Capital Holdings, the Stockwell parties, the Mackay City Council and the Sologinkins were represented in a telephone directions hearing. At that hearing, and at the suggestion of counsel for the Stockwell parties, the learned judge formally ordered that the appeal was allowed. At the same time, he adjourned the appeal “for the purpose of allowing development conditions to be formulated”. For that purpose, he made directions, which included that the Sologinkins provide a list of their concerns, with responses by given dates, that the parties participate in mediation and that issues about development conditions be determined at a hearing in the February 2008 sittings. [10] In the interval between the making of those orders on 7 December 2007 and the proposed hearing in February 2008, a number of things happened. On 21 December, 2007 Mackay City Council filed an application for leave to appeal (Appeal No 11862/07) on various grounds alleging error of law. On 24 December, 2007 the Stockwell parties also filed an application for leave to appeal to this Court (Appeal No 11897/07) against the judgment formally given on 7 December 2007. Their draft notice of appeal identified a number of alleged errors of law in the reasons for judgment, including what was said to be an error in allowing the appeal notwithstanding the learned judge’s expressed uncertainty as to the amenity impact of the development. (The two appeals are to be heard together.) [11] Meanwhile, Australian Capital Holdings appointed experts to address the amenity issues and paid for the Sologinkins to retain a town planning expert who prepared a report. Australian Capital Holdings also set about preparing proposed development conditions. In mid-January 2008, a mediation was held, unsuccessfully. On 21 January 2008, the solicitors for the Stockwell parties wrote to the other parties arguing that the hearing to determine development conditions should be adjourned pending the judgment of the Court of Appeal in the two appeals filed. On 31 January 2008, the solicitors for the Sologinkins indicated their clients’ concern about the impact of the proposed development and said that they, too, would prefer -- 5 of 9 -- 6 to await the outcome of the appeals to this Court “before committing their limited financial resources to a conditions hearing”. The decision to proceed with the hearing [12] On 4 February 2008, the learned Planning and Environment Court judge convened a directions hearing. At that hearing, counsel for Australian Capital Holdings argued that the judge ought to proceed to resolve the development conditions. There was no point in awaiting the outcome of the appeals to the Court of Appeal; if the Stockwell parties succeeded on the basis that the amenity issues had not been resolved at first instance, the matter would simply be remitted to the Planning and Environment Court to be addressed in a hearing of the kind proposed. If, on the other hand, the amenity conditions could be resolved in the Planning and Environment Court, some of the issues in that appeal would be resolved. If they were not, the Stockwell parties would have a strong argument for leave to appeal; the order of the Planning and Environment Court might even be rescinded by agreement. Australian Capital Holdings proposed a draft order with a timetable for responses to its draft approval conditions, identification of issues in dispute, expert meetings and reports, a without prejudice conference, a further mention of the appeal and its setting down for a hearing in the June 2008 sittings. [13] The Stockwell parties, with the support of the Mackay City Council, opposed the making of those directions, arguing that there was a risk that the conditions hearing would prove futile if the appeals to the Court of Appeal were allowed, with consequent unnecessary expenditure by the parties and the use of court resources to no avail. If it proved that the issues could not be resolved, the Court would be left with the “land mine” of what order could be made, given that Australian Capital Holdings’ appeal had already been allowed. On the other hand, there was no prejudice to any party in adjourning the conditions hearing until the appeals were resolved. [14] The learned judge accepted Australian Capital Holdings’ argument and proceeded to make orders for the purposes of a hearing limited to the amenity issues rather than the development conditions as a whole. He added the Sologinkins as parties to the appeal in respect only of the amenity issues affecting their properties; identified the issues in dispute as those raised in the Sologinkins’ submission of 4 December 2007; and set a timetable, broadly along the lines of Australian Capital Holdings’ draft order, culminating in a three day hearing to commence on 6 May 2008. [15] In his reasons for making the orders, the learned judge noted that, amongst their appeal grounds, the Stockwell parties had contended that Australian Capital Holdings had failed to satisfy its onus of showing that the appeal should be allowed, because of the uncertainty to do with the amenity issues affecting the Sologinkins. He continued: “Given my clear intention to resolve that matter if possible, I would think it inappropriate, indeed unjust, that any appeal in the Court of Appeal should succeed on that ground.” His Honour then made it clear that the effect of the development on amenity remained a live question: “As we are here today, there remains an issue whether my express expectation that suitable conditions to provide appropriate protection -- 6 of 9 -- 7 for the neighbours’ amenity could be incorporated in a conditions package can be fulfilled.” Noting that the Sologinkins had engaged an expert who raised amenity issues requiring a response by Australian Capital Holdings’ expert, he observed: “It remains unknown whether my confidence that the amenity issues can be resolved will prove unfounded.” His Honour went on to say that Australian Capital Holdings could not have anticipated that the Court would not accept Mr King’s views on amenity and it ought now be given the opportunity to resolve the amenity issues if possible. The applicants’ contentions in this court [16] All the applicants advanced a single set of arguments in which they were joined by the second respondent, the Mackay City Council. They contended that, while it was open to his Honour (or at least in accordance with conventional practice) to allow the appeal on the basis that the conditions attached to the approval would subsequently be resolved, he could not properly proceed with the hearing in order to resolve an issue in the allowed appeal. His stated aim, of removing the grounds concerning the amenity question from the consideration of the Court of Appeal in Appeal No 11897/07, amounted to taking into account an irrelevant consideration. [17] Relevant considerations which the learned judge had failed to take into account included the waste of time, resources and money should the appeal to the Court of Appeal succeed. That was particularly so given that the proposed hearing was limited to the amenity issues, with other development conditions still to be determined. And if it proved that the amenity issues could not be resolved, the “land mine” situation – what order could then be made – would arise. Significantly, Australian Capital Holdings had not been able to point to any prejudice to it in an adjournment. [18] The applicants accepted that the House v The King1 principles applied, since they sought to appeal from an exercise of discretion, and, more particularly, that this Court would be slow to review a refusal of an adjournment unless an injustice such as to warrant interference was shown.2 But this was a case in which error of law was identifiable. The Stockwell parties would, potentially, be deprived of a ground of appeal if the matter proceeded as the learned judge proposed. The first respondent’s contentions [19] Australian Capital Holdings pointed out that the learned judge was not functus officio once he allowed the appeal. By virtue of s 4.1.54(3) he stood in the shoes of the Council, and it remained for him to decide whether to grant the approval, and then to perform the functions which would have fallen to the Council had it made the decision: to give written notice of the decision advising whether it was approved, and if so, the conditions to which it was subject.3 Since his Honour had those continuing functions, particularly that of deciding whether or not to grant the approval, he retained power to conduct the hearing proposed. The directions made on 4 February 2008 involved merely a question of practice and procedure in that exercise of jurisdiction. The applicants should not be given leave to appeal against 1 (1936) 55 CLR 499, at 504-505. 2 Ahern v Deputy Commissioner of Taxation (Qld) (1987) 76 ALR 137, at 146. 3 Section 3.5.14(1) and (2). -- 7 of 9 -- 8 directions which were simply a continuation of a process begun by directions made on 7 December 2007, to which they had raised no objection, particularly when it was the Stockwell parties who had sought the formal making of the order that the appeal be allowed. [20] It was apparent from the discussion between his Honour and counsel at the February directions hearing that his Honour appreciated, but rejected, the submissions made for the Stockwell parties; their counsel had specifically referred him to their letter of 21 January. The effect of a further determination on the appeal was not an irrelevant consideration. If the amenity issues could be resolved, the appeal to this Court need not proceed against a background of uncertainty and the substance of the applicants’ ground of appeal would disappear. Alternatively, if the hearing at first instance were determined adversely to the first respondent, it would be difficult for it to oppose a grant of leave to appeal; although counsel conceded that that “benefit” was not identified by his Honour as a reason for proceeding. Discussion and conclusions [21] I think it is fair to say that counsel for the first respondent did not dispute that the following emerged from the learned judge’s reasons of 4 February 2008: 1. His Honour regarded the proposed hearing not merely as designed to resolve what conditions were necessary to ameliorate the impact on residential amenity, but as intended to resolve whether it was possible at all to formulate conditions to deal with the amenity issues; contemplating that it might not be possible, and by implication, that in that event the development application would not receive approval. 2. His Honour considered it appropriate to proceed with the hearing in order to resolve the amenity issues and thereby pre-empt any decision by the Court of Appeal on the amenity ground. [22] Notwithstanding the submission by counsel for the first respondent, I doubt, with respect, that the allowing of the appeal and granting of the development approval was in truth a two-stage process; or if it was, it was not one in which the two stages were independent. Under s 4.1.54(2)(c), the allowing of the appeal meant that the Council’s decision refusing to approve the development application was set aside; although the Court might, in theory, have made no further decision to grant the approval, it could not, consistently with its decision on the appeal, have refused it. It was implicit in, and necessary to, the decision to allow the appeal that the refusal of the development application was wrong. His Honour, as is clear from his observations in the reasons given on 4 February 2008, regarded the proposed hearing as having two possible outcomes: that the approval would be given with conditions or, if the amenity issues could not satisfactorily be resolved, that it would not be given at all. But the second option, entailing a decision not to grant approval, was not open once the appeal had been allowed. [23] Whether the learned judge sufficiently resolved the questions concerning the development’s impact on residential amenity in his judgment of 15 November 2007 remains a live issue in Appeal No 11897/07. However that question is answered, his Honour had, by allowing Australian Capital Holdings’ appeal, exhausted his jurisdiction to consider whether the impact on amenity was such that the development approval should not be granted. A supplementary hearing in that regard was beyond his power. -- 8 of 9 -- 9 [24] Even if that were not so: accepting as correct the respondent’s characterisation of his Honour’s orders as a matter of practice and procedure in a hearing as to which he had a continuing jurisdiction, and bearing in mind the “special restraint” to be exercised in such a context,4 this is, in my view, a case in which the Court should intervene. His Honour’s stated intent of resolving the amenity question so that no appeal would succeed on that ground manifested the taking into account of an irrelevant consideration. Whether the applicants’ ground in that regard has substance was, and remains, a question for resolution by the Court of Appeal. His Honour’s determining of the amenity issues could not retrospectively remedy any errors in his judgment so as to preclude its being set aside on appeal, although it might be argued as a reason against the granting of leave. But on any view, the hope of pre-empting the Court of Appeal’s involvement could not, whatever its charm, have been a proper reason to embark on a further hearing of those issues. On no rational construction of the Planning and Environment Court’s powers on appeal against development applications, as set out in Chapter 4, Part 1, Division 8 of the Integrated Planning Act 1997, could his Honour’s view, that the appeal to this Court should not succeed on the amenity ground, be a relevant consideration. [25] The learned judge acted on a wrong principle in taking that consideration into account. On the other side of the coin, there was no consideration favouring the hearing of the amenity question prior to the determination of the appeal to the Court of Appeal. No suggestion of prejudice to the first respondent from an adjournment arose. There were reasons against proceeding with the hearing, those identified by the applicants: the expense and the waste of court resources. The conclusion that the hearing should not be adjourned was “plainly unreasonable”5 . [26] Nothing in the applicants’ conduct militates against their being granted leave to appeal. The Stockwell parties’ suggestion that the learned judge make an order formally allowing the appeal was unremarkable, given the tenor and effect of his reasons for judgment. Their agreement to the making of directions on 7 December 2007 was given in the context of a proposed hearing as to development conditions generally, and preceded the lodging of their appeal. Orders [27] For the reasons given, I would grant the application for leave to appeal and allow the appeal, setting aside the orders of 4 February 2008 and substituting an order that any further hearing of the issues in dispute, being those identified in the Sologinkins’ submission to the Registrar of 4 December 2007, be adjourned pending determination of Appeal No 11897/07. The first respondent should pay the costs of the applicants and the second respondent. [28] FRASER JA: I agree with the reasons for judgment of Holmes JA and the orders proposed by her Honour. [29] CHESTERMAN J: I agree with the reasons of Holmes JA. 4 Queensland v JL Holdings Pty Ltd (1996) 189 CLR 146, at 173. 5 House v The King (1936) 55 CLR 499, at 504. -- 9 of 9 --