Posted on May 5, 2023 by Liam Mulligan and Stuart Simington 21

Does it matter whether a DA complies with the LEP?

It is usually thought that if a planning instrument such as an LEP contains a clause to the effect that “consent must not be granted unless…”, an application must either comply with the specified condition, or be granted a dispensation, in order for the DA to be approved. However, in a recent decision the Court of Appeal has thrown that understanding into question.

In the case, the Court determined that clause 4.3 of a standard LEP (the height of buildings development standard) is not a “jurisdictional fact” – meaning compliance with the standard is not a pre-condition to the grant of consent. Instead, the standard is simply a matter to which “regard” or consideration is required in determining a DA. There is nothing to suggest that the Court’s analysis would be any different in respect to any other development standard in an LEP or planning instrument to which ‘regard’ must be had under s 4.15(1)(a) of the Environmental Planning and Assessment Act 1979.

In November 2022, we blogged on a decision of the Court of Appeal in respect to what are known as “jurisdictional facts” (see here – Who decides what planning instruments apply to a DA?).  In that case (known as Ross v Lane), the Court of Appeal determined that a provision in SEPP 65, which caused the SEPP to apply to a DA if the consent authority was satisfied of particular matters, was not a jurisdictional fact. In Ross v Lane, whether SEPP 65 applied to depended on the consent authority forming a subjective view that particular works constituted the “substantial” redevelopment of a building.

The Court found that the state of satisfaction was not a “jurisdictional fact”. That meant that a person seeking to challenge a consent granted to the DA could not lead evidence to try to establish that the works did in fact constitute “substantial” redevelopment – the question was entirely for the decision-maker to decide. Once it had been determined by the decision-maker, it could not be challenged (except on judicial review grounds).

In that case, Beech-Jones JA (in dissent) made these remarks:

Although many environmental planning instruments, including SEPP 65, are drafted in terms that purport to dictate the matters that must be considered by the consent authority in determining a DA, they do so from a shaky premise. Section 4.15(1)(a)(i) only requires that the consent authority “take into consideration” the provisions of the relevant environmental planning instrument. A statutory requirement to “take into account” a factor in making an administrative decision means it must be “give[n] weight … as a fundamental element in making” the relevant determination ... A statutory requirement to take an instrument “into consideration” is not relevantly different. However, neither phrase requires the decision maker to apply the instrument as though it were a binding statute.

Now, in El Khouri v Gemaveld Pty Ltd [2023] NSWCA 78, the Court of Appeal has taken the analysis further. Following the same process of reasoning as in Ross v Lane, the Court determined that a development consent was not invalid, despite the fact that the building exceeded the height permitted by the LEP, and there was no request under clause 4.6 of the LEP to vary the development standard.

The issue in El Khouri arose due to the grant of consent based on an inaccurate survey, on the basis of which the parties in the Class 1 proceedings (and the Court) had understood that the building complied with the height standard. Evidence adduced in the judicial review proceedings established that this was not in fact the case. Nonetheless, the Court found that the consent had been validly granted and dismissed the proceedings.

This is a surprising result. There is a significant body of case law, over a long period of time, which establishes the primacy of jurisdictional prerequisites such as clause 4.6  in respect to the grant of development consent (not least Al Maha Pty Ltd v Huajun Investments Pty Ltd (2018) 233 LGERA 170, a case which is cited frequently in the judgment). Indeed, the following passage of Al Maha was cited with approval by the Court:

If a decision of the Land and Environment Court could be set aside or declared invalid by this Court, it is not “a decision that the Court could have made in the proper exercise of its functions”. Nor would it make sense to read s 34(3) as implicitly authorising such a decision. If the development application lacked essential elements, the deficiencies could render a consent one which could not have been granted in the proper exercise of the Court’s functions.

In circumstances where the building proposed exceeded the height development standard, and no clause 4.6 request had been provided, it is difficult to understand how the decision could have been one that the Court (in a s 34 conference) could have made in the proper exercise of its functions. It was no part of the Court’s reasoning that the parties thought that the building complied with the standard – on the Court’s reasoning, it simply did not matter that the building did not comply with the standard even where there was no 4.6 request. Considered in that light, the decision is surprising indeed.

It suggests for instance, that an applicant in Class 1 proceedings could propose a DA that did not comply with development standards and, in the absence of any clause 4.6, invite the Court to grant consent on the basis that no such request is truly required. This situation may perhaps be unlikely (as it is probable that any such consent would be susceptible to judicial review on the basis of a failure to give adequate regard to the LEP), however it appears to be an open possibility. It also appears that, in future, it will be more difficult for applicants in judicial review proceedings to have a consent set aside based on non-compliances with the LEP.

Finally, we note s 4.2 of the EPA Act:

(1) General If an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry the development out on land to which the provision applies unless—

Section 4.2 creates a criminal offence and is also enforceable by any person in civil enforcement proceedings in Class 4 of the Court’s jurisdiction. Whilst the consent was upheld in this case, the Act also requires that the development be carried out in accordance with the instrument (i.e. the LEP). In circumstances where there is no clause 4.6 request authorising the building to exceed the height control, we do not see how the consent could be acted upon consistently with the instrument: s4.2(b). We note that the Court of Appeal was referred to the section, but inaccurately paraphrases it in the judgment (so as to elide the requirement for consistency with the instrument).

You can read the case here.

If you have any questions about this blog post, please leave a comment below or contact Liam Mulligan on 02 8235 9715 or Stuart Simington on 02 8235 9704