Australia: Case note: Huntlee Pty Ltd and Minister for Planning and Infrastructure v Sweetwater Action Group Inc [2011] NSWCA 378

On 8 December 2011, the Court of Appeal handed down judgment in Huntlee Pty Ltd and Minister for Planning and Infrastructure v Sweetwater Action Group Inc [2011] NSWCA 378 overturning the decision of the Biscoe J in the Land and Environment Court declaring the rezoning of the Huntlee New Town Site invalid.

The decision has important implications for parties to voluntary planning agreements.


  • Registration of a voluntary planning agreement (VPA) may be a suitable means of enforcement under the Environmental Planning & Assessment Act, 1979 (EPA Act).
  • Each planning authority must assess the developer's obligations in a VPA and consider whether a means of enforcement offered by the developer is likely to eliminate or reduce to a commercially acceptable level the risk that each VPA obligation will not be performed. This assessment should take account of the:
    • commercial context in which the VPA will operate;
    • developer's capacity to comply with its obligations; and
    • likely availability and effectiveness of the specified means of enforcement.
  • Under the State Environmental Planning Policy No 55 – Remediation of Land (SEPP 55), the Director-General, in the process of preparation of a draft State Environmental Planning Policy (SEPP) and not the Minister who recommends the making of a SEPP, has to be satisfied about the extent of any contamination of the land the subject of rezoning.


The proceedings concerned the rezoning of the Huntlee New Town Site comprising 1,702 hectares located in the Lower Hunter region south of Branxton (Site). Huntlee Pty Ltd (Huntlee) sought the rezoning of the Site for a large-scale residential and mixed use development over a period of 20-25 years (Project). Ultimately, the Project will provide up to 7,500 dwellings accommodating about 20,000 residents, 200 hectares of employment lands and conservation lands.

On 8 July 2010, Huntlee requested that the Minister for Planning and Infrastructure (Minister) consider rezoning the Site by way of its inclusion as a State Significant Site (SSS) under Schedule 3 of the State Environmental Planning Policy (Major Development) 2005 (MD SEPP). The Minister agreed to consider the Site as a potential SSS and initiated an investigation into the proposal.

In connection with the rezoning proposal, Huntlee offered to enter into a VPA with the Minister and the Minister for Environment to make the following contributions towards environmental conservation offsets:

  • transfer of 5,612 hectares of land for environmental conservation comprising 607 hectares of land within the Site, 17 hectares for "Persoonia Park" and 4,988 hectares of land throughout the Lower Hunter region (Conservation Offset Lands Contribution);
  • monetary contributions in the amount of $1.1 million comprising $100,000 towards the conservation of Persoonia pauciflora and $1 million towards the management of the conservation offset lands (Monetary Contribution).

On or about 2 December 2010, the Minister executed the VPA and recommended to the Governor the making of State Environmental Planning Policy (Major Development) 2005 Amendment (Huntlee New Town Site) 2010 (MD SEPP Amendment) which effected the rezoning of the Site. The Governor then made the MD SEPP Amendment.

Sweetwater Action Group Inc (Sweetwater) challenged the Minister's recommendation to the Governor on the following grounds:

  1. failure to comply with clause SEPP 55;
  2. taking into account an irrelevant consideration, namely, the VPA that did not provide for enforcement by a "suitable means" as required by section 93F(3)(g) of the EPA Act; and
  3. reasonable apprehension of bias.

At first instance, Biscoe J held that the MD SEPP Amendment was invalid on the basis of Grounds 1 and 2. Sweetwater was unsuccessful on Ground 3.


In respect of Ground 1, the primary judge found that the decision to recommend the MD SEPP Amendment was invalid because the Minister failed to comply with the conditions in clause 6 of SEPP 55. Clause 6 of SEPP 55 specifies mandatory requirements to which a "planning authority" must have regard to in determining whether to rezone land.

In reaching this conclusion, Biscoe J held that the Minister was the relevant "planning authority" on the basis that he was responsible for preparing the MD SEPP Amendment. While a contamination investigation report was considered by the Director-General, the findings of that report were not adequately summarised in a briefing note to the Minister for the Minister to formed the requisite state of satisfaction. For these reasons, the Land and Environment Court found the Minister had failed to comply with SEPP 55.

In relation to Ground 2, Sweetwater did not allege that the provisions of the VPA relating to the transfer of the Conservation Offset Lands Contribution did not comply with section 93F(3)(g) of the EPA Act. Instead, Sweetwater argued that the VPA did not provide for "the enforcement of the agreement by suitable means, such as the provision of a bond or guarantee", as required by the EPA Act, in respect of the Monetary Contribution only.

The Land and Environment Court held that the reference to "suitable means, such as a bond or guarantee" required "an additional, independent and enforceable assurance" that the developer's obligations under the VPA would be fulfilled. Although the Court conceded that the examples "bond or guarantee" are not exhaustive, the suitable means must be ejusdem generis, ie. security of the same general kind as a bond or guarantee. On this basis, the Court found that the registration of the VPA on title was an insufficient means of enforcing the Monetary Contribution against Huntlee or a subsequent landowner in the event of default.

On the basis that the VPA failed to comply with section 93F(3)(g), the primary judge held that the VPA should not have been considered by the Minister in deciding to recommend the MD SEPP Amendment to the Governor. The Court held that the effect of the Minister having regard to an irrelevant consideration was to invalidate the MD SEPP Amendment.

This decision was appealed to the Court of Appeal by Huntlee and the Minister in separate proceedings. Orders were made by the Court allowing both appeals to be heard concurrently.



The Court of Appeal unanimously upheld the appeals and set aside the first instance decision (Sackville AJA delivering the leading judgment with Beazley JA and Tobias AJA agreeing).

In respect of compliance with SEPP 55, the Court held that the primary judge was in error in concluding that the MD SEPP Amendment was invalid by reason of non-compliance with clause 6 of SEPP 55. The Court indicated, without deciding, a preferred view that the Minister's power to recommend the making of a SEPP is an exercise of the executive power, rather than a statutory power conferred by the EPA Act.

Irrespective of the source of the Minister's power, there is nothing in the EPA Act suggesting that the making of a "valid" Ministerial recommendation is a necessary precondition to the Governor exercising the power conferred by section 37(1) to make a SEPP. Rather the power of the Governor to make a SEPP is only conditional upon advice of the Executive Council, and the requirement that the SEPP be for the purpose of environmental planning by the State. Therefore, regardless of the status of the decision of the Minister to recommend the MD SEPP Amendment, the Governor, on advice of the Executive Council, validly exercised the power conferred by section 37(1).

In any event, the Court found that the mandatory requirements set out in clause 6 of SEPP 55 operate only to constrain a planning authority in the preparation of an environmental planning instrument and not a Ministerial recommendation to make a SEPP. By the time the Minister recommended the MD SEPP Amendment to the Governor, the process of preparation of the SEPP had concluded and the making of the SEPP had commenced. For these reasons, the Ministerial recommendation to the Governor to make the MD SEPP Amendment fell outside the scope of clause 6 of SEPP 55.


In relation to the VPA , the Court held that the document provided for enforcement by "suitable means" and rejected the application of the ejusdem generis principle adopted by Biscoe J. Instead, the Court said the ordinary meaning of "suitability" is to be assessed "by reference to whether the means of enforcement is likely to eliminate or reduce to a commercially acceptable level the risk that the obligation created by the planning agreement will not be performed and that the planning authority or the community will not received the intended benefits". This assessment of the suitability of a means of enforcement offered by a developer requires consideration of the:

  • capacity of the developer to comply with the relevant obligations;
  • commercial context in which the VPA will operate; and
  • likely availability and effectiveness of the specified means of enforcement.

In this instance, the relevant obligation on Huntlee was its ability to pay the Monetary Contribution in a series of instalments. The risk associated with this obligation was mitigated by registration of the VPA on title and, prior to registration, the creation of an equitable interest in the land sufficient to support the Minister's lodgement of a caveat on the title of the Site. The Minister only had to withdraw the caveat once the VPA had been registered.

Based on the particular wording of the Huntlee VPA, following its registration, the obligation to pay the Monetary Contribution ran with the land until the obligation was discharged. While Huntlee may transfer the land to another developer, the safeguard in the particular provisions of the Huntlee VPA required that before any transfer takes place, the Minister must be satisfied that the proposed purchaser has the financial capacity to pay the Monetary Contribution and the purchaser must enter into a deed of novation with the Minister.

Although registration of the VPA does not necessarily eliminate entirely the risk that Huntlee might default in making the Monetary Contribution, the obvious purpose of the registration mechanism was to bind successors in title as contemplated by section 93H(3) of the EPA Act. This mechanism ensures that the owner of the Site for the time being is liable to pay the Monetary Contribution as and when the instalments are due. For this reason, the VPA was said to provide for suitable means of enforcement.

Interestingly, the Court of Appeal did not comment about the time at which security must be provided under a VPA.

That the value of Huntlee's land clearly exceeded the Monetary Contribution payable under the VPA was a factor to be considered in assessing suitability of enforcement mechanisms.


  • Registration of a VPA is now clearly available as a potential means of securing enforcement.
  • Planning authorities will likely undertake a risk assessment in respect of developer's capacity to perform each individual obligation in a VPA. This will include establishing the developer's capacity to perform including by reference to the value of the relevant property and the borrowings the developer has in place.
  • Security for performance of VPA's need not be provided solely by bank guarantee, as has become the practice.
  • Developers will need to be prepared to outline to planning authorities the commercial context in which their VPA obligations are to be performed, as this must be considered by planning authorities in assessing the suitability of enforcement mechanisms offered by developers.
  • A developer is not automatically released from its obligations under a registered VPA when the relevant land is sold. The planning authority must expressly agree to such a release.
  • SEPP 55 cannot be ignored in the process of preparing a draft environmental planning instrument. Developers taking short cuts with environmental site assessment at rezoning stage do so at their peril as this decision clarifies the obligation of local councils (for LEP's) and the Department of Planning and Infrastructure (for SEPP's) to comply with clause 6 of SEPP 55. Having said that, a SEPP made by the Governor in accordance with section 37(1) of the EPA Act will not be held invalid if there is a failure to comply with clause 6 of SEPP 55.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Most awarded firm and Australian deal of the year
Australasian Legal Business Awards
Employer of Choice for Women
Equal Opportunity for Women
in the Workplace (EOWA)

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.