Australia: NSW Planning, Environment & Government Update, September 2006

Last Updated: 31 October 2006

In this issue:

  • PART 3A - MAJOR PROJECTS - What if your development is wholly or partially prohibited under an environmental planning instrument?
  • CASE REVIEW - modification applications - a warning to applicants that unpredictable amendments can be made
What if your development is wholly or partially prohibited under an environmental planning instrument?

This question was of particular interest to the people who attended the seminar.

The Minister cannot approve a project that would, but for Part 3A, be "wholly prohibited under an environmental planning instrument" (s. 75JH(3)). This means that prohibited development can be approved under Part 3A, provided that some of the development is permissible. The question that is often raised is: how much of my development needs to be permissible in order for the Minister to be able to assess it under Part 3A?

As a starting point, the development proposal needs to be permissible on at least some portion of the site under an Environmental Planning Instrument (EPI) in order for the Minister to have the power to approve it under Part 3A.

At our seminar, Sam Haddad commented that the Department had received many applications from proponents that requested the Minister to determine a development proposal under Part 3A where the development is at least partially prohibited within the zone and which therefore would have been refused by the relevant council. A significant portion of these applications have comprised applications for seniors living where parts of those developments were recently rendered prohibited by the making of the amendment to the Seniors Living Policy in December 2006 which prohibited the development of self contained dwellings on the urban fringe Click Here to read this update).

Mr Haddad indicated that whether the Minister would approve the application or not was a discretionary matter, but that as a rule of thumb:

  • the Department discouraged the use of Part 3A as an alternative path to seeking the rezoning of the land so as to render it permissible;
  • it is considered more beneficial if the portion of the site on which the development is permissible is larger in size than the part on which the development would otherwise be prohibited under an EPI; and
  • the greater the portion of the site that comprises permissible development, the more likely it is that the whole development (including prohibited elements) will be declared a Part 3A project.

Applications – the process

Many questions and comments made at the presentation were directed to the delays that have been experienced by many proponents of development proposals both in terms of:

  • obtaining a response to the application requesting the Minister to determine the application under Part 3A (in relation to commercial and residential developments exceeding $50 million where the Minister has the discretion to consider the application under Part 3A); and
  • obtaining a determination to the application.

The main contributor to the delays seems to be the massive increase in the number of applications that Department staff now need to assess following the commencement of Part 3A.

A review of the notices of determinations of Part 3A projects listed on the Department of Planning's website reveals the following statistics:

  • a great majority of the applications have been determined by way of an approval. Note: we have not assessed whether significant modifications were made at the Minister's request;
  • of those approvals listed on the website, the time between the acceptance of the Minister to determine the application under Part 3A and the approval is approximately seven months. Additional time would be added to take account of the Minister's initial consideration of whether to treat the application as a Part 3A project; and
  • several examples of the types of developments that have been assessed under Part 3A include: construction of an 18-storey, 5-star hotel at Sydney Olympic Park (capital cost: $45 million); four medium-density buildings and 2 town houses with 110 dwellings as part of an overall master-plan site situated at Rhodes Bay; and 40 free-standing single-storey suites and facilities in Lithgow (capital cost: $56 million).

Modification applications - a warning to applicants that unpredictable amendments can be made

Applicants need to carefully consider whether they should lodge section 96 modifications relating to existing or approved developments.

The Land and Environment Court has made clear that when a section 96 modification is lodged, consent authorities do have the power to amend existing conditions or insert new conditions that amend a development even where those amendments do not form part of the modification application (1643 Pittwater Road Pty Ltd v Pittwater Council [2004] NSWLEC 685) (the Pittwater Case). A consent authority can do so even where the amendments only indirectly relate to a planning matter that arises as a result of the modification application. The example given by the Court in that case was that:

'if an application is made to modify the height of a building, consideration of any matter which is either directly or indirectly related to height will arise for consideration. If an application is made to change the approved colour of a building, matters relevant to colour must be considered. This could, in an unusual case, extend to the apparent height or bulk of the building. However, an application to change the colour of a building could not provide a basis to reconsider the provision of car parking for the development.'

Applicants should therefore be aware that consent authorities do have the power to amend parts of developments that applicants would ordinarily presume are safe from amendment, and that the Court has been relying on the Pittwater Case to do so. For example, in an application involving alterations and additions and relocation of a tennis court and swimming pool, the Court placed restrictions on the hours of use of the tennis court on the basis that during daylight hours there would be a visual impact from use of the court on a neighbour's study area (Barton v Ku-ring-gai Council [2006] NSWLEC 571).

In another case where gadens lawyers acted for the applicant, involving a modification application to insert a window in a restaurant in a hotel, the Court imposed noise amelioration conditions relating to two bars in the hotel that were situated in a distinctly separate part of the hotel (Jones v Mosman Municipal Council [2006] NSWLEC 40). The Court reasoned that it had the power to do so because the combined noise of the restaurant, together with the two bars, would be increased as a result of the insertion of the window.

Similarly, in an application involving minor refurbishment works to a hotel in Sydney, which had no existing restrictions on trading hours, the council and the Court took the opportunity to revisit the whole of the approved operation to place restrictions on the hotel's trading hours and impose a detailed plan of management regulating all aspects of the hotel's trade (gadens lawyers acted for the applicant in that case). The potential for unpredictable amendments to occur should therefore be considered by applicants when considering whether to lodge modification applications.

Suitability of site and relevance of Council policies

In Condon v Ballina Shire Council [2006] NSWLEC 430, a seniors-living development was proposed at the base of a hill (known as the 'Condon hill') on land adjoining a residential area and the town centre of Lennox Head.

In 2002, Council began a strategic planning process which resulted in the adoption of 3 documents of relevance to the proposed development: Community Aspirations Plan Strategic Plan (November 2002), Structure Plan (December 2004) and a draft LEP to rezone the land to prohibit seniors-living development (February 2005). The process involved a high level of community consultation. These documents identified Condon Hill as a place of visual significance and one which the community sought to be retained in its natural state.

The Senior Commissioner thought that the public interest required him to give more weight to the Strategic Plan and Structure Plan (community views) than the views of the applicant's visual assessment and urban design experts, or the Court Appointed Expert.

The proposal was refused, contrary to the recommendation of a Court Appointed Expert, primarily because the Senior Commissioner was of the view that the development involved substantial modifications and excavation to the natural topography in order to achieve satisfactory gradients. The Senior Commissioner concluded that the development was not suited to the topography. This case is important because it highlights the weight that the Court will give to local planning policies for these types of developments in circumstances where the policies have been created following extensive public consultation.

SEPP (Seniors Living) - development application by or on behalf of a local government or community housing provider

The SEPP (Seniors Living) continues to provide fertile ground for developers seeking to develop aged housing. In a recent case, a joint venture development between a community home group and a third party looking to develop seniors living was considered to fall outside its provisions.

The SEPP contains provisions that restrict the persons who may make development applications pursuant to the SEPP in respect of land located in certain local government areas. Generally, in these areas, an application "made only by or on behalf of a local government or community housing provider" will be permissible. The Land and Environment Court, in Burwood Area Community Housing Ltd v Sutherland Shire Council [2006] NSWLEC 313, recently considered this provision in circumstances where a community housing provider had lodged a development application as an agent for a third party.

Although the community housing provider had some minor interest in the development, the vast majority of the development was to be carried out by the third party and that the role of the community housing provider was limited to managing three out of 70 of the housing units for an initial period of five years. The Chief Judge held that it was not enough that the community housing organisation had some interest in the application, as the provision required that the application only be made by or on behalf of that organisation. The application could accordingly not proceed.

For more information, please contact:


Anthony Whealy

t (02) 9931 4867


Isabella Ferguson

t (02) 9931 4929


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.

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