Posted on June 15, 2015 by Anna Sinclair

Existing use rights – characterising the use by reference to the planning regime at the time

In Jojeni Investments Pty Ltd v Mosman Municipal Council [2015] NSWCA 147 (Jojeni) the Court of Appeal has confirmed that in determining whether land has the benefit of existing use rights, where there is no development consent which might constrain the particular use, the use must be characterised with reference to the planning regime applicable at the time the use commenced. This will require a forensic examination of the historical planning regime. In the absence of the particular use being narrowly defined at the time, there is no basis for seeking to confine the use by reference to more current definitions.

Jojeni also settles uncertainty in case law around the interaction of s 109B of the Environmental Planning & Assessment Act 1979 (EPA Act) with the existing use rights provisions in ss 106 and 107 of the  EPA Act.

Background

The appellant sought a declaration that a two-storey house in Mosman, which in 1933 was converted into two flats in accordance with a building approval (1933 Approval), had the benefit of  existing use rights as a ‘residential flat building’ (a building with three or more flats). The owner applied to Mosman Council for development consent to demolish the existing building and to construct a building containing three flats.

The proposed development was prohibited under the Mosman Local Environmental Plan 2012 (LEP) and Council refused development consent. On appeal, the Land and Environment agreed with Council’s characterisation of the existing use rights as ‘two flats in a house’ and not ‘residential flat building’.

In this case there was no development consent authorising the use and the only evidence regarding the 1933 Approval was a plan of conversion and an entry in a building register.

Decision of the Court of Appeal

The Court of Appeal determined that the proper characterisation of the existing use was a ‘building containing flats’. It found the primary judge’s characterisation was too narrow, but it was also not correct to characterise the use as ‘residential flat building’. That term was ambiguous having regard to the various definitions of the term since 1933 and the fact that the building was not being used as a ‘residential flat building’ as the term is defined in the current LEP.

In reaching this conclusion, the Court found the following facts were relevant:

1. the 1933 Approval was for modifications to an existing structure so as to create two flats;
2. approval of the use for flats was not required under the planning regime at the time and there was no basis for concluding that the 1933 Approval granted consent for any use; and
3. the dwelling house, as altered by the 1933 Approval was a ‘residential flat building’ as that term was then understood.

The primary judge had characterised the use of the building on the basis of the plan of conversion alone. In contrast, the Court of Appeal’s approach was to infer the use from the plans and the planning regime applicable in 1933. This led the Court to find that the source of the existing use right was the fact the building had been lawfully used for residential purposes for many years prior to the conversion to two flats, and not the 1933 Approval to modify the building to two flats.

Characterisation of Use

The Court of Appeal characterised the use of the building by applying well-established principles of characterisation (i.e. it is the characterisation of the purpose of the use, and existing uses should be characterised as liberally as the statutory language allows).

Importantly, in determining that the building was characterised as a ‘building containing flats’, the Court found that it had to apply the level of generality that existed under the 1933 planning regime. Attention also had to be focused on the town-planning purpose for which the determination was made, and the 1933 regime made no differentiation based on the intensity of the use as a residential flat building (i.e. the number of flats). There was no basis to apply the narrower meaning under current environmental planning instruments given to ‘residential flat building’ (i.e. three or more flats).

Implications

This decision demonstrates the importance of carefully analysing the historical evidence when considering whether existing use rights exist, particularly where there is no development consent as to use. Unlike cases where a development consent prescribes and usually defines the permitted use, regard must be had to the use that was permissible under the planning regime at the time.

In these types of cases the class of uses under previous planning regimes may be broader than those that currently exist, and may result in holders of existing use rights having broader rights for future development under the current planning regime. Those rights, however, will continue to be restrained by the statutory limitation that there is no right “to do anything beyond the existing use in the existing structure until a proposal is approved on its merits” (Jojeni at [57]).

Clarification of the interaction of sections 106 and 109B of the EPA Act

Jojeni also resolves the inconsistency in decisions of the Land and Environment Court on the interaction between ss 109B and 106 of the EPA Act (see Currency Corporation Pty Ltd v Wyong Shire Council [2006] NSWLWC 692 and Caltex Australia Petroleum Pty Ltd v Manly Council [2007] NSWLEC 105).

The Court of Appeal has preferred the approach taken by Biscoe J in Currency Corporation and makes it clear that s 109B of the EPA Act (which permits a person to continue to carry out development pursuant to a development consent even if a subsequent planning instrument prohibits the use of the land to which the consent relates for that purpose) is subordinate to s 106 of the EPA Act (which defines existing uses).

It has held that a use pursuant to a development consent protected by s 109B may also be an existing use within the meaning of s 106 and afforded the existing use right protections under the EPA Act. Effectively, s 109B provides an additional protection for an existing use which is a use authorised by a development consent.