In brief - Recent decisions show risks of breaching development consent or anticipating grant of modification 

A common issue planning and environment lawyers advise on is where development proceeds faster than the relevant certifications and approvals are obtained. Sometimes developers and builders get ahead of themselves unintentionally. At other times calculated risks are taken to carry out development in anticipation of the grant of consent or in breach of it. Both scenarios carry some inherent risks. 
We take a look at two recent Land and Environment Court decisions, both involving Strathfield Municipal Council, where injunctions have been awarded to stop such works from proceeding:

Prohibitionist starting point: development consents and applications for consent authority modifications

The starting point for any analysis on this issue is section 76A(1) of the Environmental Planning and Assessment Act 1979 (NSW). This section provides that where the relevant environmental planning instrument stipulates that specified development cannot be performed without a development consent, a development consent must be obtained and development must be performed in accordance with that consent. 
Section 96 allows an application to be made to the consent authority to modify a development consent. Following a consideration of prescribed matters in the statute, the consent authority may subsequently choose to consent to or refuse the application. It may also do nothing, in which case a deemed refusal may crystallise.
Carrying out development in anticipation of a modification being consented to, or in breach of a consent, carries inherent risk. Where the relevant authority identifies development occurring prior to the grant, it may seek an order from the court to injunct the works from proceeding. In addition, there is the risk that the consent authority may ultimately refuse the application, requiring the developer to bear the cost of correcting any development not in accordance with the original development consent. 

Court awards injunction to stop works proceeding despite evidence of likely consent to modification application

In the matter of Strathfield Municipal Council v Michael Raad Architect Pty Ltd (No 2), the respondents' development progressed faster than the consent for the modification was obtained. The in-force consent provided for the construction of a multi-level basement for a block of residential units. The respondents lodged a section 96 consent modification application to construct only a single-level basement. Prior to the determination of the application, the respondents commenced works to construct the single-level basement. 
On application by Strathfield Council, an injunction to stop works proceeding was awarded despite evidence before the Court indicating that it was likely the modification application would be granted consent. In his reasons, Robson J observed (at [47]) that the respondents had taken a "calculated risk in undertaking this further work". He found that the Court should not "countenance what appears to be flouting of the planning regime simply because the respondents are prepared to take what is said to be a commercial risk." (Ibid.) 

Strathfield Municipal Council successfully applies for injunction of works not in accordance with development consent 

In Strathfield Municipal Council v C & C Investments Trading Pty Ltd, the first and second respondents (the developer and builder respectively) undertook development in contravention of a condition of consent. The contraventions included the construction of blade walls, a hard stand courtyard, balconies and enclosed outdoor areas. Following the Council issuing a "Cease Work Order", the respondents lodged a section 96 modification application to "regularise the non-compliances". This application was refused by the Council. (See at [18].)
The Council applied to injunct the performance of any works at the premises that were not in accordance with the development consent. The Council contended in support of the injunction that in order to ensure that approval for the development was obtained, the first and second respondents removed elements of their development proposal that were objectionable to the Council. Once the approval was obtained, they intentionally reincorporated the unapproved and objectionable elements breaching the conditions of consent. The Council claimed that such behaviour "undermin[ed] the development approval regime". (At [27].) The Court found that the balance of convenience favoured the grant of an order to stop works proceeding. 

Injunction risk considerations for developers and builders

Both of these cases show that there are risks of works being injuncted where development is carried out in contravention of in-force approvals or where it is carried out without approval. 
We are seeing an increase in the enforcement activity of regulatory authorities at this time. Those involved with development should bear in mind the suite of options available to authorities which can impose a significant cost burden not just in litigation costs but also the project costs while activity stalls.

This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2024.

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