The rules for lapsing periods for development consents are
changed by the Environmental Planning and Assessment Amendment
(Development Consents) Act 2010 (NSW), which commenced on 26
Reducing the lapsing period
Under the Environment Planning and Assessment Act 1979,
most development consents lapse on their five year anniversary
unless there is, before that date, "actual commencement"
(in the case of uses) or "physical commencement" (in the
case of development). At present a consent authority has power to
reduce the lapsing period when granting consent (except in relation
to staged development). The lapsing period for development consents
to erect or demolish a building, or subdivide land may currently be
reduced to as little as two years.
The amendment removes this power from 26 May 2010 until 1 July
2011 (or until any subsequent date prescribed by the
It also operates retrospectively where a consent authority has
already reduced a lapsing period and this is due to occur after 22
April 2010 (the amendment's introduction date). In such cases,
the consent holder may disregard the reduction and rely on the full
five year period.
The purpose of the amendment is to provide further stimulus to
the development industry and prevent valid development from lapsing
during current economic conditions. The changes include an
opportunity for future regulations to further extend the stimulus
after 1 July 2011.
Any consent holder missing out on this assistance remains
entitled to apply for a one year extension of the lapsing period,
under existing section 95A.
Codifying when development has "physically
The amendment also provides that regulations may set out
circumstances in which work is or is not taken to be
"physically commenced". This term has been extensively
analysed by the courts and we would expect any statutory guidance
on "physically commencement" to show:
the work must be more than merely preparatory
it must be consented work (ie not illegal or in breach of
it must be commenced on the land in a physical sense (as
opposed to off-site design and planning)
it must be real, positive and unequivocal as opposed to
equivocal, notional or a sham.
It will be interesting to see how the proposed regulations deal
with the other point highly emphasised by judges – that
there is an element of fact and degree in every case.
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