How to prepare conditions that work for applicants, assessment managers and referral agencies Dated: 9 August 2011 Level 11 Central Plaza Two 66 Eagle Street Brisbane QLD 4000 GPO Box 1855 Brisbane QLD 4001 Australia ABN 42 721 345 951 Telephone +61 7 3233 8888 Fax +61 7 3229 9949 Offices Brisbane Sydney Newcastle www.mccullough.com.au
Table of contents 1 Introduction ----------------------------------------------------------------------------------------- 1 2 The relevant and reasonable test ----------------------------------------------------------------- 1 3 Conditions that may be imposed ------------------------------------------------------------------ 3 4 Conditions that cannot be imposed --------------------------------------------------------------- 3 5 Planning purpose ----------------------------------------------------------------------------------- 4 6 Finality ----------------------------------------------------------------------------------------------- 4 7 Ambiguity-------------------------------------------------------------------------------------------- 5 8 Enforcement----------------------------------------------------------------------------------------- 6 9 Referral agencies ----------------------------------------------------------------------------------- 7 10 Environmental offsets ------------------------------------------------------------------------------ 7 11 Refusal ----------------------------------------------------------------------------------------------- 7 12 Infrastructure --------------------------------------------------------------------------------------- 8 13 Changes to conditions ------------------------------------------------------------------------------ 8 14 Practice Direction 1 of 2011 ----------------------------------------------------------------------- 9 15 Conclusion ------------------------------------------------------------------------------------------- 9 9 August 2011
How to prepare conditions that work for applicants, assessment managers and referral agencies Troy Webb and Sarah Wheatley 1 Introduction 1.1 Conditions are an important aspect of the development process. They will often be aimed at minimising the negative effects of the development on the community. Conditions can be the difference between an approval and a refusal; or between a profitable development and a nonviable development. 1.2 Conditions attach to the land so they must be able to be understood and carried out by a subsequent owner. An unlawful condition cannot be remedied by the applicant s consent. 1 Well drafted conditions may avoid time consuming and costly negotiations and appeals. 1.3 The nature and scope of the conditions of a development approval should be considered in light of the particular facts and circumstances of the development proposal which is being assessed. There is no one size fits all conditions package for development. Whilst standard conditions undoubtedly improve efficiency and clarity in conditions packages, assessing officers should consider how each condition applies to the particular proposal. 1.4 This paper provides an overview of the law about conditions of approval. The legislative provisions will be outlined and analysed in the context of established rules set out in cases. 2 The relevant and reasonable test 2.1 The starting point for any discussion about lawful conditions is the relevant and reasonable test. In broad terms, the relevant and reasonable test has been with us in a number of different iterations under superseded legislation. As a result, there is a substantial body of case law relating to the lawfulness of conditions. 2.2 It is instructive to consider the specific provisions of the Sustainable Planning Act 2009 (Qld) (SPA): Section 345 - Conditions must be relevant or reasonable (1) A condition must (a) be relevant to, but not an unreasonable imposition on, the development or use of premises as a consequence of the development; or (b) be reasonably required in relation to the development or use of premises as a consequence of the development. (2) Subsection (1) applies despite the laws that are administered by, and the policies that are reasonably identifiable as policies applied by, an assessment manager or concurrence agency. 1 Hammercall Pty Ltd v Gold Coast City Council & Anor [2004] QPELR 112. 9 August 2011
2.3 Importantly, the elements of section 345(1) are alternatives; a lawful condition need only satisfy one of the two limbs. The application of section 345 will largely depend on the facts and circumstances of each case. The nature of the provision is such that there is no one size fits all standard to apply to all development applications. 2.4 In respect of the first limb, the leading authority explains: It may well be that a condition which is in no proper sense of the word required by a subdivision is nevertheless relevant in the way indicated by the High Court as falling within the proper standards in local development or in some other legitimate sense. For example, a condition relating to the layout of the subdivisional roads may not be able to be supported as required reasonably or otherwise by the subdivision in question, but may be defensible as reasonably imposed in the interests of the rational development of the area in which the subdivision is located. 2 2.5 The case of Clift v Gold Coast City Council [2005] QPEC 106 (Clift) provides an example of the application of the first limb and section 345(2). In Clift, Council sought to apply its infrastructure policy for a infrastructure charges condition. However, the subject residential development was at a much lower density than that anticipated by the relevant infrastructure policies. The Court held that the infrastructure charge ought to be made on the basis of a maximum practical yield factor, rather than the maximum potential allowed by the planning documents (which could never be achieved on the subject site). 2.6 In respect of the second limb, the leading authority states: The statutory test that has to be applied by the local authority in deciding whether to attach conditions to its approval in a case such as the present is whether the conditions are reasonably required by the subdivision. This means that the local authority, in deciding whether a condition is reasonably required by the subdivision, is entitled to take into account the fact of the subdivision and the changes that the subdivision is likely to produce for example, in a case such as the present, the increased use of the road and of the bridge and to impose such conditions as appear to be reasonably required in those circumstances. 3 2.7 In Wootton v Woongarra Shire Council (1985) 56 LGRA 301, the relevant Council sought to impose a condition requiring a monetary contribution to infrastructure in circumstances where the existing infrastructure had sufficient capacity to cope with the proposed development and no augmentation work would be required. In finding that such condition was not lawful, the Court of Appeal stated: The question must be whether there is a relevant nexus between the use of the land and the conditions sought to be imposed, that nexus being that the proposed use creates such a change in existing affairs that the condition is a reasonable response to it. 4 2.8 In Grabbe v Maroochy Shire Council [2005] QPEC 044 Council imposed a condition that required the grant of a lease to Council to protect the subject land from agricultural spray from the adjoining agricultural land until such time as there was a change of use of the adjoining land. The adjoining land was subsequently sold to a developer and the agricultural use had been abandoned. As a result, the Court allowed a change to the subject condition on the basis that it was no longer reasonably required. 2 Proctor v Brisbane City Council (1993) LGERA 398 at 404. 3 Cardwell Shire Council v King Ranch Aust Pty Ltd (1984) 54 LGRA 110. 4 Wootton v Woongarra Shire Council (1985) 56 LGRA 301 at 303. 9 August 2011 2
3 Conditions that may be imposed 3.1 Section 346 of SPA describes certain conditions that may be imposed. The list is not exhaustive, but provides an indication of the types of issues to be dealt with by conditions. A condition may (a) (b) (c) (d) (e) (f) place a limit on how long a lawful use may continue or works may remain in place; or state a development may not start until other development permits or compliance permits, for development on the same premises, have been given or other development on the same premises, including development not covered by the development application, has been substantially started or completed; or require compliance with an infrastructure agreement relating to the land; or require a document or work to be subject to compliance assessment; or require development, or an aspect of development, to be completed within a particular time; or require the payment of security under an agreement under section 348 to support a condition mentioned in paragraph (e). 3.2 The conditions must still satisfy section 345 of SPA, except for a condition that requires compliance with an infrastructure agreement which is deemed to comply with that section. 5 4 Conditions that cannot be imposed 4.1 Section 347 of SPA specifies certain conditions that cannot be imposed even if they meet the test in section 345. 4.2 A condition must not be inconsistent with a condition of an earlier development approval or compliance permit still in effect for the development. 6 This rule only applies where the approvals relate to the same development as defined by the legislation. 7 4.3 Section 347 of SPA: (a) (b) (c) (d) prevents the imposition of infrastructure charges other than in accordance with chapter 8, part 1 of SPA; 8 prevents a condition that requires a person other than the applicant to carry out works; prohibits a condition for an access restriction strip; or in the context of development for a network of community infrastructure, prevents the imposition of a condition that limits the time a development approval has effect. 4.4 There are also restrictions on the imposition of certain conditions at common law, for example: 5 Sustainable Planning Act 2009, section 346(2). 6 Sustainable Planning Act 2009, section 347(1)(a). 7 Liquorland (Aust) Pty Ltd v Gold Coast City Council [2002] QPELR 295; Stockland Developments Pty Ltd v Gold Coast City Council [2008] QPELR 529. 8 Sustainable Planning Act 2009 (Qld), sections 649 and 650 provide for the circumstances. See also sections 847 and 848 but note the new restriction under section 880. 9 August 2011 3
(a) (b) a condition cannot require an indemnity; 9 and a condition can only require preservation of land for a road corridor if the planning for the road is sufficiently certain. 10 5 Planning purpose 5.1 The conditions of an approval must be for a planning purpose. The assessment manager or referral agency has been given power to assess the development application for its planning merit against the laws and policies of the relevant agency. The position can be summarised as: A planning purpose is one that implements a planning policy whose scope is ascertained by reference to the legislation that confers planning functions on the authority, not by reference to some preconceived general notion of what constitutes planning. 11 5.2 However, a condition that complies with the planning authority s laws and policies will not necessarily guarantee that the condition is lawful, as the condition must still meet the test in section 345 of SPA. 12 5.3 It is not the function of the planning authority to fix issues that existed before the proposed development and which will not be affected or worsened by the proposed development. 13 In Sumvista Pty Ltd v Redland Shire Council the Court refused to impose a condition to redress the flow of stormwater over adjoining land which would be perpetuated by the proposed development but not worsened. 5.4 Similarly, the planning authority cannot seek to protect land that is not threatened by the development the subject of the application by the imposition of conditions. Where the subject development does not affect natural values, and a development application would be required in order to do so, the imposition of a condition that seeks to protect and manage the natural values land has been found to be premature. 14 6 Finality 6.1 Generally a condition must be final, otherwise it is at risk of being found to be unlawful for reasons of uncertainty. The assessing authority is under a duty to decide an application with finality and may not postpone an element of its necessary decision or delegate its power to decide that element to some other person or body. 15 6.2 The application of this principle has changed over time as a result of the number of approvals required for a development. In particular, the use of the compliance assessment process envisages that some elements of the development will not be dealt with in the preliminary approval but instead during the compliance assessment stage. It is now quite common to see 9 Galandon Pty Ltd v Narrabri Shire Council (1983) 51 LGRA 5. 10 Australian Retirement Homes Limited v Pine Rivers Shire Council [2007] QPEC 085; Northern Beaches Developments Pty Ltd v Mackay City Council [1999] QPELR 389; Multispan Australia Pty Ltd v Brisbane City Council & Anor (no. 2) [2008] QPEC 35. 11 Hammercall Pty Ltd v Gold Coast City Council & Anor [2005] QCA 29 at [57] citing Western Australian Planning Commission v Temwood Holdings Pty Ltd [2004] HCA 63. 12 Sustainable Planning Act 2009 (Qld) s345(2); Clift v Gold Coast City Council [2005] QPEC 106; Hickey Lawyers v Gold Coast City Council [2005] QPELR 597. 13 Sumvista Pty Ltd v Redland Shire Council [2005] QPEC 002 at [40]. 14 The Corporation of the Trustees of the Roman Catholic Archdiocese of Brisbane v Gold Coast City Council [2010] QPEC 17. 15 Mt Marrow Blue Metal Quarries Pty Ltd v Moreton Shire Council (1994) 85 LGERA 408. 9 August 2011 4
conditions that require detailed plans for particular elements of the development to be submitted for Council approval eg, landscaping or building design. Indeed, section 346(1)(d) of SPA expressly allows this to occur. 6.3 However, the test remains that the assessing authority must not defer a decision on material matters for a later date. The leading case is McBain v Clifton Shire Council (1995) 89 LGERA 372 which concerned a condition of approval for a piggery. The offending condition required that a base level of 20,000 pigs be only increased in staged increments to a maximum of 80,000 pigs. Each stage was to be subject to the written approval of the local government, relying on the advice of a Monitoring Review Committee that pig stock numbers represented a sustainable operation in accordance with an environmental management plan. The condition was held to offend the finality principle as it postponed a key element of the development for a later day. 6.4 By contrast, a condition that required an easement and building restriction line to ensure that residences were not affected by noise from a quarry was held to be valid as the condition included specific, objective noise levels. 16 7 Ambiguity 7.1 It is relevant for Council and government officers to be aware of the consequences of drafting a condition which is ambiguous. In a nutshell, the case law demonstrates an interpretation which favours a developer over Council in those circumstances. 17 7.2 In Ryde Municipal Council v Royal Ryde Homes 18, Else-Mitchell J stated at page 323 in the context of interpretation of a town planning consent: I therefore think it is sound to say that the legal qualities a consent possesses, or which flow from a consent, are so important care should be taken to ensure that consents are framed in clear terms and conditions are specified with certainty. Any lack of clarity or certainty is the responsibility of the council and it must take the consequences of any failure to specify accurately or in detail what is considered to as well as any conditions to which consent is subject. 7.3 In Mariner Construction Pty Ltd v Maroochy Shire Council, His Honour Senior Judge Skoien stated at page 336: If a condition is imposed which is to restrict the operation of a permit (and in this case very severely and in a surprising way) it should be expressed clearly. That allows the permittee, if unhappy with the condition, to appeal to this court but if the condition is so obscurely worded, the permittee may honestly interpret it in a way which is not restrictive and fail to exercise one s right of appeal. 7.4 These authorities highlight the need for clarity in the drafting of development approval conditions and demonstrate the approach the Courts are likely to take in the event of any ambiguity. 16 Mt Marrow Blue Metal Quarries Pty Ltd v Moreton Shire Council (1994) 85 LGERA 408. 17 Ryde Municipal Council v Royal Ryde Homes [1970] 19 LGRA 321, Auburn Municipal Council v Szabo (1971) 67 LGRA 427, Sydney Service Departments Pty Ltd v North Sydney Municipal Council [2] (1993) 78 LGERA 404 and Winn v Director-General of Natural Parks & Wildlife [2001] NSW CA17. 18 [1970] 19 LGRA 321. See also Auburn Municipal Council v Szabo (1971) 67 LGRA 427, Sydney Service Departments Pty Ltd v North Sydney Municipal Council [2] (1993) 78 LGERA 404 and Winn v Director-General of Natural Parks & Wildlife [2001] NSW CA17. 9 August 2011 5
8 Enforcement 8.1 A condition must not require onerous supervision by the relevant authority. 19 This is both a legal rule and practical necessity. A condition that is difficult to enforce is unlikely to achieve its objective. 8.2 SPA provides for an offence for contravention of a development approval or compliance permit including any condition in the approval or permit, with a maximum penalty of 1665 penalty units and 165 penalty units respectively. 20 This is a clear indication that the Queensland Parliament considers the issue of compliance with conditions as being of some considerable importance. 8.3 The development assessment officer should have an appreciation of the public nature of development approvals and the conditions as many other persons will be scrutinising those conditions. This includes not only an applicant in the IDAS process seeking a negotiated decision notice or lodging an appeal against conditions. It also includes others (within and external to a Council) involved in: (a) (b) (c) (d) (e) consideration of subsequent development applications such as operational works; compliance assessment associated with plan sealing of plans of survey following the approval of a reconfiguration of a lot; the process associated with issuing full planning and development certificates requiring the checking of Council development approval conditions for compliance; assessing building work noting the restrictions imposed upon a private certifier by way of penalty if he or she approves an application which is inconsistent with an earlier approval or permit 21 ; and responding to complaints about non-compliance with conditions included in development approvals issued by a Council. 8.4 Conditions of approval are therefore the subject of close scrutiny at all levels within and external to a public organisation and at various stages within the life of a development proposal. Conditions are also scrutinised by applicants and their consultants during the IDAS process and also legal representatives prior to and subsequent to an appeal being lodged, or through consideration of a request for a negotiated decision notice. 22 8.5 For development compliance officers and legal representatives involved in an enforcement process for Council, the need to prove an offence to a potentially high civil or criminal standard must be borne in mind by development assessment officers in the drafting of conditions of approval. 8.6 The use of advice notes by Councils and referral agencies has been adopted by a number of Councils as a way of notifying developers of additional requirements, and also providing a flag for compliance officers inspecting development. However, it is questionable whether the Court has jurisdiction to include advice notes in its development approvals, and advice notes cannot be relied upon for enforcement action in relation to a breach of a condition of a development approval. 19 Westfield Management Ltd v Pine Rivers Shire Council & Anor [2005] QPEC 015 20 Sustainable Planning Act 2009 (Qld) sections 576 and 580. Under section 181B Penalties and Sentences Act 1992 (Qld) a corporation could be fined up to five times the maximum fine for an individual. 21 See section 84 of the Building Act 1975. 22 Sustainable Planning Act 2009 (Qld) sections 361 and 461(1)(b). 9 August 2011 6
9 Referral agencies 9.1 Referral agencies will often draw on their enabling legislation and policies in preparing conditions of approval. The relevant and reasonable test in section 345 of SPA is said to apply despite the laws that are administered by, and the policies that are reasonably identifiable as policies applied by, an assessment manager or concurrence agency. As a result, referral agencies must always reflect upon whether the condition is an appropriate and lawful response to the development. 9.2 The case of Multispan Australia Pty Ltd v Brisbane City Council & Anor (no. 2) [2008] QPEC 35 (Multispan) provides a useful example. In Multispan, the Department of Main Roads ( DMR as it then was) sought to impose a condition limiting the currency period of the approval to 2 years on the basis of a DMR policy and to protect a possible future upgrade of the adjoining state controlled road. The Court held that the condition was not lawful as the project that the condition sought to protect was speculative and any DMR policy could not be applied blindly, without reference to the circumstances of a particular case. 23 10 Environmental offsets 10.1 Earlier this year, SPA was amended to provide an explicit power to impose environmental offset conditions. Section 346A(4) of SPA deems an environmental offset condition to comply with section 345 and that it is not invalid on the ground of being uncertain or lacking finality if an applicant has entered into an agreement about an environmental offset. Also, an environmental offset condition may require work to be done beyond the bounds of the development land. 24 10.2 The explanatory notes to the amending Act notes that a person may appeal an environmental offset condition on the grounds of the quality or quantity of the offset required. However, the threshold issue for the imposition of an environmental offset condition is if the concurrence agency or assessment manager is satisfied that all cost-effective on-site mitigation measures for the development have been, or will be, undertaken. Importantly, this is a subjective test to justify the imposition of a condition requiring works to counterbalance the environmental impact of the development. 10.3 The Queensland Government Environmental Offsets Policy (QGEOP) specifies that offsets should only be required as a condition of an approval where there is a specific-issue offsets policy, subject to a number of exemptions. The following are the current specific issue offset policies: (a) (b) (c) Policy for Vegetation Management Offsets; and Mitigation and Compensation for Works or Activities Causing Marine Fish Habitat Loss and the Offset Measures Information for Marine Fish Habitat Loss; and Offsets for Net Gain of Koala Habitat in South East Queensland Policy. 11 Refusal 11.1 There may be cases where but for the imposition of a particular condition, a development application ought to be refused. A difficulty arises where that condition is said to be unlawful. 25 The Court has recognised that a Council may adopt a position in an appeal that a particular condition is so important that without it, the application should be refused. 23 Multispan Australia Pty Ltd v Brisbane City Council & Anor (no. 2) [2008] QPEC 35 at [13]. 24 Sustainable Planning Act 2009 (Qld), section 346A(6). 25 Waterfront v Hervey Bay City Council [2008] QPEC 17; Property 4 Retail Pty Ltd v Hervey Bay City Council [2006] QPEC 110. 9 August 2011 7
11.2 For assessment managers and referral agencies struggling to draft a lawful condition, it may be useful to consider whether the application ought to be refused. For developers instituting a conditions appeal, it may be relevant to consider Council s attitude to the development without the inclusion of a particular condition (although an unlawful condition cannot be made lawful by the consent of the developer). 12 Infrastructure 12.1 Under IPA and SPA there were complex rules and case law about the interaction between the general rules about conditions and the specific rules for infrastructure contributions. 12.2 In general, conditions about infrastructure contributions were required to have a nexus to a Council planning scheme policy about infrastructure. 26 The infrastructure conditions were also required to comply with section 345 of SPA and the common law requirements for conditions. 12.3 In Hickey Lawyers v Gold Coast City Council [2005] QPELR 597, Judge Robin QC acknowledged that it was open, but not necessarily an easy task to persuade the court that conditions complying with the legislative requirement for conditions flowing from planning scheme policies duly adopted, are unreasonable or irrelevant. The consequence is that there will be few, if any, circumstances in which a condition imposed in accordance with a valid policy fails the relevant and reasonable test. 12.4 It is likely that the principles from these cases and the application of the planning scheme policies for infrastructure will become less relevant with the infrastructure cap for trunk infrastructure under the Sustainable Planning (Housing Affordability and Infrastructure Charges Reform) Amendment Act 2011 which amended SPA and commenced on 1 July 2011. That new regime relies upon a local government issuing an adopted infrastructure charges notice for trunk infrastructure rather than through conditions imposed on a development approval. 27 12.5 Appeal rights in relation to an adopted infrastructure charge are quite limited. 28 13 Changes to conditions 13.1 It is often the case that as a development progresses the developer desires a change to the conditions of approval because of changes in the market, or as a result of the detailed planning and implementation of the development. Assessment managers (which may include the Court) and referral agencies will be called upon to assess the change to the condition in the context of what might be a different planning, economic or political environment. 13.2 The introduction of the SPA and the repeal of the IPA has changed the process for making changes to conditions of approval. Under the section 3.5.33 process under IPA, Council could only approve or refuse a request to change a condition; there was no express power to impose additional conditions arising from the change. Under SPA, the permissible change process relates to a change to the approval, rather than a specific condition, and, the relevant entity can approve the request, with or without conditions, or refuse the request. 13.3 The permissible change process enables the other agencies involved in the assessment of the development application to assess the application for a permissible change, as well as the agency that imposed the condition. 26 Sustainable Planning Act 2009 (Qld) sections 649 and 650. 27 Sustainable Planning Act 2009 (Qld), section 880. Sections 649 and 650 still provide for the circumstances in which conditions may be imposed. 28 Sustainable Planning Act 2009 (Qld) sections 478(4). 9 August 2011 8
14 Practice Direction 1 of 2011 14.1 On 9 May 2011, the Planning and Environment Court issued a new practice direction in respect conditions appeals and infrastructure charges appeals. The purpose of the practice direction is to ensure the expeditious resolution of appeals, consistent with the philosophy contained in the Planning and Environment Court Rules 2010 (Qld). 14.2 The new practice direction requires that, within one month after the commencement of an infrastructure charges appeal or a conditions appeal, the parties agree on a date to participate in a mediation, without prejudice conference or case management conference chaired by the ADR registrar. The ADR registrar may list proceedings for review by a judge if the parties fail to comply with the practice direction. 15 Conclusion 15.1 Development approvals and conditions are public documents that have an impact well beyond the date of the decision notice. Well drafted conditions may lessen the likelihood of triggering a negotiated decision notice process or conditions appeal and may deliver more certainty in the achievement of desired planning outcomes and compliance. 15.2 Assessment managers and referral agencies should be familiar with the scope of their power to impose conditions in the context of the legal rules and relevant policy documents. 15.3 Developers should seek to clarify any ambiguity in conditions of approval in order to avoid delay and disputes as the development progresses. Troy Webb and Sarah Wheatley McCullough Robertson Lawyers 9 August 2011 Disclaimer This paper deals with a number of legal and technical issues in a general way and laws will inevitable change. This paper is intended for information purposes only and should not be regarded as legal advice. If a specific scenario arises then competent legal advice should be obtained rather than relying on the general matters outlined in this paper. 9 August 2011 9