Posted on June 14, 2021 by Stuart Simington and Adriana Kleiss
Can compliance with planning controls be satisfied by deferred commencement conditions?
Section 4.16(3) of the Environmental Planning and Assessment Act 1979 (NSW) allows a consent authority to grant a ‘deferred commencement consent’. The subsection provides:
‘A development consent may be granted subject to a condition that the consent is not to operate until the applicant satisfies the consent authority, in accordance with the regulations, as to any matter specified in the condition. Nothing in this Act prevents a person from doing such things as may be necessary to comply with the condition.’
This blog discusses three recent cases in which the Court found that a deferred commencement consent could not be granted because the development the subject of the development application did not satisfy certain controls in the environmental planning instrument (EPI).
MS Windsor St Pty Ltd v Hawkesbury City Council  NSWLEC 1223
In MS Windsor, a Commissioner of the Land and Environment Court held that the breach of the height of buildings development standard could not be satisfied by way of a deferred commencement condition providing for amended plans for the lowering of the building before the consent operated.
The case concerned an appeal against Hawkesbury City Council’s refusal of an application for shop top housing. The party’s experts agreed that the development breached the maximum height limit imposed by clause 4.3 of the Hawkesbury Local Environmental Plan 2012 but no written request to vary the standard under cl4.6 was submitted with the application.
The Applicant argued that the height exceedance was capable of being resolved by the imposition of a deferred commencement condition that required the first and second floor levels to be reduced by 130mm so as to comply with the standard.
In response, the Council submitted that a condition, including a deferred commencement condition, could not be used to satisfy the standard because the Court was required to determine the development as contained in the development application, and therefore it was that development (and not the development as modified by a proposed condition) that was required to meet the standard (at ).
The Commissioner agreed with the Council and relied on the decision of the Court of Appeal in Michael Brown Planning Strategies Pty Ltd v Wingecarribee Shire Council  NSWCA 137.
Michael Brown Planning Strategies Pty Ltd v Wingecarribee Shire Council  NSWCA 137 and Ballina Shire Council v Palm Lake Works Pty Ltd  NSWLEC 41
In Michael Brown Planning Strategies, the Court of Appeal upheld the two previous decisions of Moore J and Commissioner Dickson in the Land and Environment Court to refuse consent to development on the basis that the Court, acting as consent authority, could not be satisfied that the development ‘is compatible with the flood hazard of the land’ as was required by clause 7.9(3)(a) of the Wingecarribee Local Environmental Plan 2010.
The Applicant argued that the relevant question was whether the development would, when carried out, be compatible with the flood hazard of the land and submitted that the imposition of a deferred commencement condition requiring flood mitigation works to be carried out on the land prior to commencement of the development would achieve that result. However, the Court of Appeal rejected the argument. The Court said that the correct question was whether the development satisfied the precondition at the time of granting consent – and it did not. A deferred commencement condition could not be used to satisfy clause 7.9(3)(a) because the relevant state of satisfaction was required in respect of the development proposed prior to the grant of consent.
Similar reasoning can be found in the case of of Ballina Shire Council v Palm Lake Works Pty Ltd  NSWLEC 41 which we discussed earlier here. In that case, Preston CJ relevantly held that clause 28(1) of State Environmental Planning Policy (Housing for Seniors or People with Disability) 2004, which provides that consent must not be granted unless the consent authority ‘is satisfied by written evidence that the housing will be connected to a reticulated water system and have adequate facilities for the removal or disposal of sewage’, could not be met by a deferred commencement condition that required an application for and approval of the sewer mains required to service the development. This was because:
(a) approval for the required water and sewer services might not be granted; and
(b) there was clearly also no requisite written evidence that it would be.
In other words, compliance with clause 28(1) was not met at the time of granting consent.
In both Michael Brown Planning Strategies and Palm Lake Works, the Court rejected the argument that the deferred commencement condition satisfied the requirement because the development could not lawfully proceed unless the condition was satisfied. While this would seem to have been an argument with some appeal, it was rejected in both cases.
The particular terms of each applicable planning control needs to be carefully considered before a conclusion can be reached on whether the power to grant consent can be satisfied by a condition.
The cases discussed above do, however, certainly make it clear that consent authorities cannot defer the satisfaction of preconditions that must exist at the time consent is granted.
The result in MS Windsor is less convincing. The height of a building development standard does not impose any precondition on the granting of consent but simply states that the height of a building on any land is not to exceed the maximum height shown for the land on the height of buildings map. It is not clear why, in this situation, the imposition of a condition of consent is an impermissible way in which ensure that there will be no such non-compliant building. The Commissioner appears to have read into the clause a requirement that does not exist in the standard namely that the building ‘proposed‘ meet the requirement.
If you would like to discuss the issues raised in this post, please contact Adriana Kleiss on 8235 9718 or Stuart Simington on 8235 9704.