Posted on October 28, 2011 by Lindsay Taylor

Section 94 credits for previous development

On 14 October 2011, Commissioner Tuor in the Land and Environment Court handed down her decision in Meriton Apartments Pty Ltd v Council of the City of Sydney [2011] NSWLEC 1294.

The case involved an appeal by Meriton against a decision of the Council to refuse to modify a development consent to reduce the amount of s94 contributions payable to the Council in connection with a mixed use development being carried out by Meriton at Zetland in inner Sydney in an area known as ‘Victoria Park’.

The conditions of consent required Meriton to make a monetary contribution of approximately $5,400,000.00 to the Council. determined in accordance with the Council’s s94 contributions plan applying to the development site.  The reduction sought by Meriton was approximately $265,000.00.

Meriton sought the reduction as a s94 ‘credit’ to reflect the historic demand generated for public amenities and public services by a previous workforce population that existed on the site in connection with previous development on the site.

The Council’s contribution plan addressed the issue of a credit for workforce populations associated with previous development, including on sites vacant at the time a development application is made. The plan adopted the 2001 census date as the time to determine the size of the previous workforce population and its demand for public amenities and public services.

At the time the subject development consent was granted to Meriton, there was no workforce population on site. The previous workforce population had been on the site between the early 1950’s the mid 1990’s when the development site and surrounding land comprised what is now known as the ‘former British Leyland site’. Furthermore, there was no workforce population on the site at the 2001 census date. The effect of this was that the contributions plan did not authorise the credit sought by Meriton.

Meriton argued that the condition requiring the s94 contribution would be unreasonable if it did not reflect the credit for the former workforce population and that measuring the population at a fixed ‘cut off’ point was arbitrary and unreasonable.

This case was subsequent to a recent decision of the NSW Court of Appeal in Meriton Apartments Pty Ltd v Council of the City of Sydney [2011] NSWCA 17 relating to the determination of s94 credits on another part of the former British Leyland site under the same contributions plan. In that case, the Court of Appeal overturned a decision of the Land and Environment Court to grant a discounted previous workforce credit to Meriton. Senior Commissioner Moore in the Land and Environment Court had given a credit for the historic workforce but had discounted it based on the rating history of the site. The Court of Appeal held that the rating history of the site was irrelevant to the determination of the credit.

Commissioner Tuor decided that the Court of Appeal’s decision did not constrain her ability to make a finding on the merits of the case that a credit should not be given to Meriton in relation to the previous workforce population. In this regard she declined to follow the approach of  Senior Commissioner Moore in the Land and Environment Court at first instance in the previous Meriton case.

The Commissioner discussed the principle recognised by the Court of Appeal that, in order for a condition imposed under s94 to be reasonable, the s94 contribution must relate to the net increase in demand for public amenities and public services arising from development and that, in appropriate circumstances, a 94 credit should be given to reflect the demand for public amenities and public services arising from a previous workforce population on a site. She also accepted that strict adherence to the 2001 census date in the contributions plan for determining the former workforce population on the site could produce an unreasonable result.

Nevertheless, on the facts of the case, the Commissioner was satisfied that no credit should be given as she was satisfied that the former workforce population did not generate a demand for the specific public amenities and public services the subject of the Council’s contributions plan.

Accordingly, Meriton’s appeal was dismissed.