In brief
The case of Wagner Investments Pty Ltd & Anor v Toowoomba Regional Council [2019] QPEC 24 concerned a total of 10 appeals in the Planning and Environment Court against negotiated infrastructure charge notices (ICNs) issued under the now repealed Sustainable Planning Act 2009 (SPA). Nine ICNs related to both stormwater trunk infrastructure and transport trunk infrastructure networks. One related to transport trunk infrastructure networks only.
In respect of the ICNs for stormwater trunk infrastructure, the Court found that they were not for trunk infrastructure identified in the Toowoomba Regional Council's Local Government Infrastructure Plan (LGIP). The Court held that section 636 of the SPA requires that a levied charge only be for additional demand placed upon trunk infrastructure. As there was no trunk infrastructure for which additional demand could be placed, the Court ordered that the ICNs be set aside.
In relation to most of the ICNs issued for transport trunk infrastructure, despite varied reasoning, the Court ultimately found that the ICN amounts were not lawfully reasonable in the Wednesbury sense. These conclusions were premised upon the improper assessment of use and demand and the incorrect application of specialised uses by the Toowoomba Regional Council (Council). Three ICNs issued for transport trunk infrastructure were held to be lawfully reasonable.
In relation to the ICN for reconfiguring a lot, based on the evidence presented to the Court, the Court found that reconfiguring a lot the subject of the appeal, did not generate demand on infrastructure. This and the other ICNs for transport trunk infrastructure were remitted back to the Council.
Factual circumstances
The ICNs issued by the Council pursuant to section 635 of the SPA arose out of development approvals granted to Wagner Investments Pty Ltd and Marcoola Investments Pty Ltd (Wagner Group) for the development of an airport and a business park located within the Council's local government area. The total amount of the charges appealed against was $2,930,239.03.
The appeals
The SPA outlines the specific grounds of appeal which may be raised in appeals against infrastructure charges notices in section 478(2). Wagner Group appealed on the following grounds:
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Section 478(2)(a) - the charge in the notice was so unreasonable that no reasonable relevant local government could have imposed it.
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Section 478(2)(b)(i) - the decision involved an error relating to the application of the relevant charge adopted.
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Section 478(2)(c)(ii) - the decision involved an error relating to the working out, for section 636, of additional demand.
The powers of the Planning and Environment Court in respect of appeals against infrastructure charges notices are found in section 47 of the Planning and Environment Court Act 2016 and section 496 of the SPA. Those sections provide that the Planning and Environment Court can confirm, change, set aside and replace, or set aside and remit the matter back to the local government who made the determination.
The Court began with the proposition that the fundamental starting point in any exercise of statutory construction is to recognise that it is the duty of the Court to give the words of a statutory provision the meaning that the legislature is taken to have intended. Starting with section 636 of the SPA, the Court noted that the legislature intended there be two requirements before an infrastructure charges notice can issue. Firstly, there must be trunk infrastructure, and secondly, there must be additional demand on that trunk infrastructure (see [17]).
The broad topics the Court had to consider in these appeals can be separated into stormwater trunk infrastructure and transport trunk infrastructure.
Stormwater trunk infrastructure
In relation to the infrastructure charges notices relating to stormwater trunk infrastructure, it was common ground between the parties that the Council's LGIP did not specifically identify stormwater trunk infrastructure that was relevant to the development. The Council argued however, that Westbrook Creek which adjoined the site, was relevant stormwater trunk infrastructure as the Council's planning scheme identified that the trunk infrastructure network included natural formed and unformed waterways (see [29]).
After consideration of the statutory regime, the Court rejected the Council's argument and held that Westbrook Creek was not relevant trunk infrastructure. In making this determination, the Court noted that the LGIP identified both the existing and proposed trunk infrastructure networks in the Plans for Trunk Infrastructure (PFTI) and no part of Westbrook Creek in the vicinity of the land was identified in the PFTI.
The Court therefore determined that section 636 of the SPA was not enlivened and it did not have to consider whether there was additional demand on trunk infrastructure. However, if the issue of additional demand was required to be considered, the Court held that it was satisfied that no additional demand would be placed on trunk infrastructure as a result of the development (see [37]).
Transport trunk infrastructure
In relation to the infrastructure charges notices relating to transport infrastructure, the parties agreed that there would be additional demand placed on transport trunk infrastructure. Wagner Group however argued that the charges imposed by the Council had no rational or reasonable basis and should be set aside and the Council be required to reconsider and issue new charges.
In determining whether or not the infrastructure charges issued by the Council were invalid due to being so unreasonable that no reasonable local government could have imposed them, the Court relied upon the principles enunciated in Associates Provincial Picture Houses Pty Ltd v Wednesbury Corporation [1948] 1 KB 223, including:
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A decision being arbitrary may indicate unreasonableness.
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A decision without common sense may be unreasonable.
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Lack of intelligible or evident justification may result in unreasonableness.
The Court held that a number of the ICNs issued for transport trunk infrastructure were outside of the range of possible legal outcomes. This conclusion was premised on the Council's categorisation of development as either "industry" or "essential services" which adopted a calculation methodology of a dollar rate per square metre for the relevant gross floor area (GFA) rather than as a "specialised use" which required an assessment of use and demand (see [79]).
The Council's downfall in this regard was that the development to which the ICNs related clearly fell within the definition of "air services" and constituted a "specialised use" for the purposes of determining the infrastructure charges to be applied and not the category of "industry" or "essential services" adopted by the Council. The Court held that there was clearly an intended distinction in the methodologies of assessment to be applied for specialised uses and other uses, and accordingly, the Council should have conducted an assessment of use and demand rather than "the broad brush GFA approach adopted " (see [82]) as it was bound to do by virtue of its own policies (see [86]).
The Court criticised the Council's GFA approach on the basis that it failed to take account of the likely traffic that would be generated from the developments (see [60] to [68]; [83]). The Court concluded, whilst recognising this method may be used, that there was insufficient correlation between the GFA and volumes of traffic for the charges levied by the Council to be reliable.
Two other ICNs were categorised by the Council as "warehouse". Although the approvals relating to these ICNs were for material change in use to a "warehouse" and a "warehouse (freight)", the Court held that the application of the GFA methodology resulted in charges that could not sensibly fall within the range of possible lawful outcomes (see [94]). The Court considered the proximity of the warehouse developments to the runway and their association with the operation of the airport sufficient to warrant a categorisation of the developments as "air services" which is a "specialised use" requiring an assessment of use and demand (see [93]).
In respect of three other ICNs issued for transport trunk infrastructure and categorised as "industry" for the purpose of determining the adopted charge, the Court held that the approach of the Council was not unreasonable as they relevantly fell within the description of "industry" and the expert evidence demonstrated demand would be placed on trunk infrastructure (see [88] to [90]). These three appeals were dismissed.
The ICN issued by the Council for reconfiguring a lot was held unreasonable on the basis the evidence presented to the Court failed to demonstrate a rational link between the reconfiguration of the land and the estimated additional demand that would be placed on the transport trunk infrastructure network (see [99]).
Conclusion
All appeals against ICNs relating to stormwater infrastructure charges were allowed and set aside based on the proper construction of the SPA and the Council's charges resolution. The appeals relating to transport trunk infrastructure networks, except the three dismissed, were set aside and remitted back to the Council for reassessment.