Posted on October 31, 2018 by Katie Mortimer and Stuart Simington

Conciliation agreements – Commissioners must give reasons

A development consent granted by a Land and Environment Court Commissioner following a s34 conciliation conference has been set aside by the Court of Appeal because the Commissioner failed to give reasons evidencing her satisfaction as to the legal prerequisites to her power to grant the consent.

Huajun Investments Pty Ltd (Developer) appealed against the City of Canada Bay Council’s (Council) deemed refusal of DA seeking approval to demolish existing structures on land at Strathfield (Site) and to erect an 8-storey residential flat building (DA).

After a conciliation conference under section 34 of the Land and Environment Court Act 1979 (LEC Act), Commissioner Smithson granted development consent in the terms agreed by the parties under s34(3) of the LEC Act.

Section 34(3) requires that if parties reach agreement on the terms of a decision, being a decision that the Court could have made in the proper exercise of its functions, the Commissioner:

‘(a)  must dispose of the proceedings in accordance with the decision, and

(b)  must set out in writing the terms of the decision.’

The case raised the question as to whether the Land and Environment Court (LEC) ‘could’ have lawfully made the decision and whether the reasons for decision reflected this.

Al Maha Pty Ltd (Al Maha) commenced the judicial review proceedings in the Court of Appeal (Court) alleging that the development consent (Consent) granted by the Court was invalid.

Al Maha owned land that adjoined the Site. It had objected to the DA on the basis that part of the Developer’s development encroached on its land where Al Maha had not provided owner’s consent to the DA.

Al Maha also alleged that the Commissioner was not empowered to grant the Consent because the Commissioner did not form the opinions of satisfaction required by clause 4.6 of the Canada Bay Local Environmental Plan 2013 (LEP).

Clause 4.6

The DA contravened the height standard in clause 4.3 of the LEP.

Clause 4.6 of Standard Instrument LEPs nevertheless allows for a consent authority to grant development consent if satisfied of the requirements of clause 4.6(4)(a):

‘(4)   Development consent must not be granted for development that contravenes a development standard unless:

(a)   the consent authority is satisfied that:

(i)   the applicant’s written request has adequately  addressed  the matters required to be demonstrated by subclause (3), and

(ii)   the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out, and

(b)   the concurrence of the Secretary has been obtained.’

Preston CJ of the LEC recently clarified the correct approach to determining a cl4.6 written request. See our earlier blog on this decision here.

Although the Developer had submitted a cl4.6 written request, the Commissioner’s judgment and orders did not disclose any consideration of the request, and in particular whether she had formed the requisite opinions required by cl4.6.

In the absence of written reasons, and particularly where s34(3) of the LEC Act requires a Commissioner to set out in writing the terms of the decision, the Court inferred that the Commissioner had not formed the necessary opinions. If so, she lacked power to grant the Consent.

Owner’s Consent 

The Environmental Planning Assessment Act 1979 and the Environmental Planning and Assessment Regulation 2000 requires a development application to include evidence that the owner of the land on which development is to be carried out consents to the application.  This is also a jurisdictional prerequisite to a consent authority’s power to grant development consent.

The Court found that the Consent approved the construction a driveway connection on Al Maha’s land but as Al Maha had not provided owner’s consent to the DA the Commissioner also lacked power to grant the consent despite the agreement of the parties.

Key Lessons from the case

This case has significant implications for the way that LEC judicial officers draft their decisions following a successful conciliation conference.

When parties reach agreement under s34 of the LEC Act, the reasons for the decision should disclose the Commissioner’s consideration of any essential prerequisites to the granting of consent including such matters as required for clause 4.6 dispensations.

This will, in our experience, also mean that parties to a s34 agreement will need to be in a position to brief the presiding Commissioner in more detail on the basis on which their agreement satisfies each relevant matter on which the Court’s jurisdiction to implement the agreement depends.

Read the case in full here: Al Maha Pty Ltd v Huajun Investments Pty Ltd [2018] NSWCA 245

Should you wish to discuss this post, please contact Stuart Simington on 8235 9704 or by email at