In the November 2009 issue of Legally Green we reported on the release of the NSW Sea Level Rise Policy Statement (Policy Statement) by the NSW Department of Environment, Climate Change and Water (DECCW), which adopts sea level rise planning benchmarks (Benchmarks) for an increase above the 1990 mean sea levels of 40cm by 2050 and 90cm by 2100. We also noted the Department of Planning's release of the draft NSW Coastal Planning Guideline: Adapting to Sea Level Rise and the two draft guides released by DECCW to assist councils in preparing and adapting to rising sea levels. A response to submissions received on the guideline and these guides is expected in early 2010.
The Policy Statement sets out the NSW Government's approach to sea level rise, the risks to property owners from coastal processes and, relevantly, provides a framework to guide councils in strategic planning and in assessing development proposals given the predicted sea level rise and the Government's commitment to helping councils manage and adapt to sea level rise.
The Implications of the Policy Statement for Local Councils and Developers
As stated in the Policy Statement, the Benchmarks are intended to guide councils in carrying out strategic planning and development assessment under the Environmental Planning and Assessment Act 1979 (EPA Act). The Policy Statement requires councils to use the Benchmarks when undertaking coastal and flood hazard assessments in accordance with DECCW's Coastline Management and Floodplain Development Manuals (Manuals). Relevantly, when preparing local environmental plans (LEP), there is a statutory requirement for councils to ensure that LEPs are consistent with and give effect to these Manuals.
Therefore, councils now need to ensure LEPs are consistent with and give effect to the Benchmarks and, as such, subsequent development under LEPs is consistent with and gives effect to the Benchmarks. Councils may also be required to notify the adoption of the Policy Statement and Benchmarks in planning certificates issued pursuant to s 149 of the EPA Act.
Developers will be required to ensure that future development proposals are consistent with the Benchmarks under LEPs and, on acquiring property, should check the s 149(5) planning certificate to identify if the relevant council has adopted the Policy Statement and Benchmarks and any other relevant plans and policies.
The Implications of the Policy Statement for Council and Developer Liability
The Policy Statement and Benchmarks may have significant implications for the liability of councils and developers.
Although the Policy Statement outlines the NSW Government's commitment to assisting councils to identify and reduce risks posed by sea level rise, the Government says that it has and accepts no liability under statute or common law to reduce the impacts of sea level rise on private property. In addition, the Policy Statement includes a disclaimer (Disclaimer) under which the Government, "[its agencies and employees disclaim any and all liability to any person in respect of anything or the consequences of any [actions or omissions carried out] in reliance on...any part of [the Policy]".
However, this does not change the situation for local councils which may be liable for land use planning and development assessment decisions in coastal areas, regardless of any assistance they may receive from the NSW Government in identifying the risks that bear upon those decisions. In particular, councils may be liable in common law negligence or nuisance, or under the Civil Liabilities Act 2002 for negligence or breach of statutory duty.
In some circumstances, a council may be able to rely on an exemption under s 733 of the Local Government Act 1993 (NSW) (LG Act), which provides that a council does not incur any liability in respect of any advice furnished in good faith, or anything done or omitted to be done, in good faith, relating to the likelihood of:
- any land being flooded or the nature or extent of such flooding; and
- land in the coastal zone being affected by a coastline hazard or the nature and extent of such a hazard.
This exemption may for example protect councils from liability resulting from actions such as approval of development on land subject to coastal hazards or sea level rise. Whether the exemption is available will depend on the specific facts of a particular situation.
In Bankstown City Council v Alamdo Holdings Pty Ltd (2005) 223 CLR 660, the High Court of Australia recognised that the purpose of the exemption is primarily to prevent councils from being overly cautious in providing development consent for potentially sensitive flood-prone land or land potentially affected by coastal hazard, by indemnifying such Council decisions provided that they are made in accordance with government policy at the time. The exemption may apply to Council decisions in respect of land potentially affected by sea level rise especially given that the Policy Statement states that "the Benchmarks are not intended to be used to preclude development of land that is projected to be affected by sea level rise".
In Melaleuca Estate Pty Ltd v Port Stephens Council (2006) 143 LGERA 319, the NSW Court of Appeal determined that the Council was liable in nuisance for the discharge of water onto the plaintiff's land for approving the original development and constructing the drainage works. The Court held that the statutory exemption under s 733 of the LG Act did not apply as the Council had not acted in good faith. Notably, the Court held that the Council had not acted in good faith as, by failing to rectify the nuisance, it had disregarded the rights of the owners to the use and enjoyment of the land, and that the Council's budgetary constraints and priorities were irrelevant in this regard.
Where the exemption is the subject of litigation, the Courts may also consider the broader policy framework for combating sea level rise in determining whether councils have furnished advice or acted or omitted to act in good faith. Notably, in November 2009, the Federal Government released the Climate Change Risks to Australia's Coast: A First Pass National Assessment in which a more conservative estimate of a sea level rise of 1.1 metres by the year 2010 was selected as a plausible value for the purposes of the risk assessment. Councils may adopt this more conservative benchmark in their operations especially noting that the Policy Statement itself recognises that the accuracy of sea level rise projections will improve over time and also that NSW has the greatest exposure to risk of inundation of all the Australian states and territories.
Despite the possible availability of exemptions, councils may consider adopting a disclaimer regarding their adoption and application of the Policy Statement and Benchmarks similar to that of the NSW Government noted above.
Insurance and Indemnities
Finally, councils and developers should consider the impact of the Policy Statement and Benchmarks on the operation of any insurance or indemnities relating to their role in the development of land which may be at risk from sea level rise. In some circumstances, councils and developers may lose insurance coverage if they do not take into account the Policy Statement and Benchmarks when approving or undertaking development or making other decisions, and damage to property or personal injury occurs as a result of sea level rise or coastal and flooding hazards.
Recent Court Decision
The potential for Council liability for sea level rise and the above issues have been highlighted by the recent Land and Environment Court decision in Vaughan v Byron Shire Council (judgment yet to be published). In that case, Byron Shire Council was held responsible for maintaining beach stabilisation works designed to offset the effects of erosion caused by severe storms. This case should be carefully monitored as the Council has confirmed that, although the costs of maintaining beach stabilisation works have been covered by its insurers, further proceedings will be before the courts regarding the Council's liability for the works, especially given its policy of "planned retreat".
In this context, it is also worth noting the recently released Parliamentary Committee's report "Managing our costal zone in a changing climate" which identifies that legal liability associated with climate change is an important issue to be addressed. One of the Committee's recommendations is that the Government request the Law Reform Commission to undertake an inquiry with emphasis on the legal liability of public authorities in relation to climate change adaptation and possible climate hazards, mechanisms to ensure mandatory risk disclosure to the public about climate change risks and coastal hazards and whether there should be broader indemnification of local governments. It remains to be seen whether this suggestion will be implemented.
If you require assistance in determining how climate change and in particular, sea level rise, needs to be considered in relation to your operations, please do not hesitate to contact a member of our Climate Change team.
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.