Posted on August 28, 2017 by Katie Mortimer and

Testing the waters – the Court of Appeal rules on the proper application of the Catchment SEPP

A recent decision of the Court of Appeal (‘Court‘) has ruled on the proper application of the State Environment Planning Policy (Sydney Drinking Water Catchment) 2011 (NSW) (‘Catchment SEPP‘) when a proposal for development will involve the discharge of water within the Sydney drinking water catchment.

The Court determined that a development consent issued by the Planning Assessment Commission (‘PAC‘) was invalid as the PAC had not properly applied the Catchment SEPP.

In the case of 4nature Incorporated v Centennial Springvale Pty Ltd [2017] NSWCA 191 the appellant (‘4nature‘) challenged the PAC’s grant of consent to a development application to extend Springvale Mine (‘DA‘).

The PAC decision to extend mining at Springvale Mine was made 9 days before approval for Springvale Mine’s existing operation ended.

The key questions on appeal were:

  1. in determining whether a proposed development will have a neutral or beneficial effect on water quality, what is the nature of the comparison required by cl 10(1) of the Catchment SEPP?
  2. did the PAC take a valid approach in answering question 1, and achieve the requisite state of satisfaction?

Legislation relating to Sydney drinking water catchment

Two pieces of legislation govern the impacts of development on the Sydney water drinking catchment; section 34(B(2) of the Environmental Planning and Assessment Act 1979 (‘EPA Act‘) and clause 10(1) of the Catchment SEPP.

Both instruments require a consent authority to be satisfied of a development having a neutral or beneficial effect on water quality.

Clause 10(1) of the Catchment SEPP relevantly states:

‘A consent authority must not grant consent to the carrying out of development under Part 4 of the Act on land in the Sydney drinking water catchment unless it is satisfied that the carrying out of the proposed development would have a neutral or beneficial effect on water quality.’

The Court’s finding 

The Court found that in determining whether a proposed development will have a neutral or beneficial effect on water quality, a comparison of water quality is required to occur.

In makings its decision the PAC had assessed the current permissible level of salinity discharge from the Springvale Mine, as the baseline to use for this comparison. The PAC had not given consideration to the impending termination of the consent that allowed for the salinity discharge.

The Court considered the PAC’s reliance on this baseline was erroneous as clause 10(1) of the SEPP must be undertaken ‘by reference to actual, and not hypothetical, water quality’, and, the PAC did not consider what might happen at Springvale Mine ‘when the mining operation terminated‘ (i.e. would the current salinity discharges affecting water quality continue without mining).

The Court found that clause 10(1) of the SEPP required the PAC to be satisfied that the DA itself would have a neutral or beneficial effect on water quality. This question did not require the PAC to be satisfied that the DA would be less harmful to water quality than the current impacts under the operational consent for the mine, that was due to expire before the DA’s proposed commencement. The PAC should not have assessed the effect on water quality of the DA by assuming that the historical mining on the site would continue.

This meant that the question clause 10(1) posed required the PAC to consider what would occur to water quality if the DA was refused. The PAC had not done so and therefore it had misapplied the test required under clause 10(1). This rendered the consent invalid.

Subordinate vs primary legislation

Another ground of appeal the applicant pressed was that the primary judge had erred in applying the Catchment SEPP, in requiring its construction with ‘regard to more practical considerations, rather than by a strict adherence to its language‘ due to its status as subordinate legislation.

The Court distinguished that when applying the Catchment SEPP (subordinate legislation) rather than the EPA Act (primary legislation) there is no principle that requires: ‘laxity or flexibility in construing delegated legislation, or statutory instruments generally‘ [45]. As the Catchment SEPP mirrored the EPA Act, it could not be said that it was not drafted as carefully as the primary legislation, and ‘there is no general proposition that the task of ascertaining the legal meaning of delegated legislation differs from the construction of primary legislation‘ [60].

Read the full decision of the Court here.

This blog was prepared with the assistance of Katie Mortimer.

Should you wish to discuss this case contact Carlo Zoppo, Partner on 8235 9705 or by email, at