Not enough interest: Court of Appeal reverses the decision of the Planning and Environment Court to approve a service station and retail uses despite conflicts and finds that establishing a need for the proposed development was not sufficient to justify the approval

In brief

The case of Gold Coast City Council v K & K (GC) Pty Ltd [2019] QCA 132 concerned an application by the Gold Coast City Council (Council) to the Court of Appeal for leave to appeal against a decision of the Planning and Environment Court to approve a proposed development for a service station, convenience store, take-away food premises and a fast food drive through premises despite its conflicts with the Gold Coast City Planning Scheme 2003 (2003 Planning Scheme). 

The Court of Appeal held that the Planning and Environment Court had erred in its decision to allow the development application despite its conflicts and found that the identified need for the proposed development was not enough to justify its approval. The Court of Appeal found that there had been a failure by both parties to apprehend and apply the applicable statutory requirements.

We have previously reported on the original decision of K & K (GC) Pty Ltd v Gold Coast City Council [2018] QPEC 9 in our April 2018 edition of Legal Knowledge Matters, which can be accessed here.  

Grounds to the appeal

The Council contended that the Planning and Environment Court had erred in its decision to allow the appeal on the following grounds:

1. The Planning and Environment Court had erred in determining the scope of the conflict that invoked the application of section 326(1)(b) of the now repealed Sustainable Planning Act 2009 (SPA) in that the conflicts could be reduced by other considerations.

2. The Planning and Environment Court had erred in holding that the need for the proposed development was sufficient, together with other grounds, to justify the approval of the development application despite the conflicts.

3. The Planning and Environment Court had misconstrued the definition of "neighbourhood centre" for the purposes of the Gold Coast City Plan 2016 (2016 City Plan), and that error had infected the exercise of discretion.

4. The Planning and Environment Court had failed to appreciate the weight that should be afforded to the 2016 City Plan, which had supplanted the 2003 Planning Scheme.

Prior decision of the Planning and Environment Court

The Applicant submitted a development application to the Council for a development permit for the proposed development. 

The Council refused the development application on the basis that the development conflicted with the 2003 Planning Scheme. The Applicant appealed the Council's decision to the Planning and Environment Court.

In the Planning and Environment Court proceedings, the Applicant submitted that the development should be approved despite the conflicts with the 2003 Planning Scheme as there were matters of public interest to justify the approval.

The Planning and Environment Court agreed with the Applicant and found that although the conflicts with the 2003 Planning Scheme arising from the proposed development were not "simply technical or trivial, but, by reason of there being the result of an 'evident policy intention', were at the more serious end of the spectrum" at [231], the serious conflicts were significantly reduced because the extent of the need for the proposed development was sufficient to justify the approval.

The Council appealed the decision to the Court of Appeal.

Conflict with the SPA cannot be reduced by other considerations 

Section 326(1)(b) of the SPA relevantly states that "the assessment manager's decision must not conflict with a relevant instrument unless there are sufficient grounds to justify the decision despite the conflict". The Council submitted that the Planning and Environment Court had erred in its approach in determining the scope of the conflict that invoked the application of section 326(1)(b) of the SPA. The Council also submitted that the Planning and Environment Court was wrong to conclude that certain factors which were identified by the Planning and Environment Court in the appeal, had the effect of reducing the seriousness of the identified conflict. The Council further submitted that as a matter of principle, the level of conflict with such a binary provision could not be reduced by other considerations.

The Court of Appeal rejected the Council’s submissions and held that the Planning and Environment Court was correct in its approach to consider the degree of conflict as it was not irrelevant that the uses that would create a conflict were uses that would be only a smaller part of a larger unobjectionable use. The Court of Appeal held that the examination of the nature and extent of an asserted conflict is a step that is required by section 326(1)(b) of the SPA. 

Sufficient need

The Applicant submitted that there was a need for the proposed development which constituted a matter of public interest, and that the need was sufficient to overcome the conflict. The Court of Appeal noted that the Applicant had not advanced any argument in the appeal as to why the need was sufficient to overcome the conflict. 

The Council contended that the exercise of considering whether there were sufficient grounds to justify approval despite the conflicts, required the following:

1. the identification of grounds;

2. an assessment of the role and importance to the relevant planning scheme of the provisions which would be infringed should the proposal be approved;

3. a consideration of the adverse consequences which might flow from the infringement; and

4. a consideration of the competing merits and the weight of the grounds relied upon to justify the approval.

The Court of Appeal agreed with the first two submissions advanced by the Council but dismissed the third and fourth submissions on the basis that those considerations were the process required by former legislation, namely the Local Government Act 1936. The Court of Appeal held that the SPA required there to be "sufficient matters of public interest" to justify a decision. As such, the Court of Appeal found that both parties had wrongfully prepared their evidence and submissions upon the need for a service station, rather than the other matters of public interest. 

The Court of Appeal noted that although the words “matters of public interest” appeared in various places in the record, the case actually proceeded upon the basis of assumptions that considerations that were once relevant under repealed legislation were those that still applied under the SPA. The Court of Appeal found that determining the existence of a need for a particular kind of development was just the starting point to satisfy section 326(1)(b) of the SPA.

Importantly, the Court of Appeal found consistent with many case authorities including most recently, Bell v Brisbane City Council [2018] QCA 84, that, “at the heart of decisions like these is the acknowledgement that conformity with the Planning Scheme is prima facie, in the public interest” (at [47]). The Court of Appeal therefore found that it would never be enough for a party to merely prove that there is a need for the proposed development to satisfy section 326(1)(b) of the SPA. 

The Court of Appeal held that for a party to appropriately address a provision, such as section 326(1)(b) of the SPA when there is a conflict, it must identify reasons as to why the terms of the relevant planning scheme ought not to prevail. The Court of Appeal found that otherwise there would be a risk that, rather than applying section 326(1)(b) of the SPA, the decision maker would be doing no more than performing a general weighing of factors in order to determine whether it would be better to permit the development. 

Discretion to consider 2016 City Plan and interpretation of “neighbourhood centre” within the meaning of the 2016 City Plan

The Council submitted that the Planning and Environment Court should have exercised its discretionary power conferred by section 495(2)(a) of the SPA to give the provisions of the 2016 City Plan due weight. Section 495(2)(a) of the SPA relevantly provides that "the court must decide the appeal based on the laws and policies applying when the application was made but may give weight to any new laws and policies the court considers appropriate". 

The Court of Appeal held that the weight to be given to discretionary factors such as the contents of the 2016 City Plan is a matter for the decision maker. The Court of Appeal held that a court that reviews an exercise of discretion that involves assessing the weight to be given to relevant factors, should not substitute its own view unless it has been shown that the decision was unreasonable in the Wednesbury sense. 

The Council also submitted that the Planning and Environment Court had misconstrued the meaning of “neighbourhood centre” within the meaning of the 2016 City Plan and that this had infected the Planning and Environment Court’s exercise of discretion. The 2016 City Plan relevantly defines “neighbourhood centre” as comprising “a minimum of five separate commercial or retail tenancies located within a single centre or comprising a consolidation of separate but interconnected uses”. 

The Court of Appeal accepted the Council’s submission and found that the proposed development did not satisfy the definition of a "neighbourhood centre" as the proposed development involved fewer than five tenancies, and fewer than five separate but interconnected uses. The Court of Appeal held that the proposed development was a service station including ancillary businesses and was not a “neighbourhood centre” under the 2016 City Plan in any sense of the expression. The Court of Appeal held that this error in construction affected the exercise of the Planning and Environment Court's discretion, as the Planning and Environment Court had concluded that the consideration of the provisions of the 2016 City Plan concerning “neighbourhood centres” meant that “neighbourhood centres” could be located in medium density residential zones and low density residential zones in certain circumstances. As a consequence, the Court of Appeal found that this was an error of law that vitiated the exercise of discretion by the Planning and Environment Court. 

Conclusion

The Court of Appeal therefore granted leave to appeal, allowed the appeal, set aside the orders made by the Planning and Environment Court and remitted the case back to the Planning and Environment Court. The Court of Appeal ordered that the Applicant pay the Council's costs of the appeal.