In brief

The case of Paul & Anor v the Corporation of the City of Marion [2021] SASC 3 concerned an appeal to the Land and Valuation Division of the Supreme Court of South Australia (Supreme Court) against the dismissal by the Environment, Resources and Development Court of South Australia (ERD Court) of an appeal against the refusal by the Corporation of the City of Marion (Council) of an application under section 40(3) of the Development Act 1993 (SA) (Act) to extend (extension application) the operative period of a development plan consent (DPC). 

The ERD Court dismissed the appeal because it was not satisfied that the Appellants evidenced the requisite commitment to the DPC, and the changes to the Marion Council Development Plan (Development Plan), which came into force five months after the approval of the DPC, meant that a DPC application under the changed Development Plan would likely be refused.

The appeal to the Supreme Court was made under section 30(1)(b) of the Environment, Resources and Development Court Act 1993 (SA) (ERD Court Act). Section 30(2) of the ERD Court Act allowed the appeal as of right in respect of each question of law, and required the leave of the Supreme Court in respect of each question of fact. 

The discretionary considerations of the Supreme Court in determining whether to allow a question of fact included whether there was an arguable case or a question of principle involved, the significance of the development, the importance of the development to the parties, its impact on the locality, and each party's approach to the issue before the lower Court and planning authority. 

The Supreme Court held that leave to appeal a question of fact ought to be granted, where there is an "identifiable and egregious" error in that the conclusions drawn are "glaringly improbable" or "contrary to compelling inferences". 

The Appellants alleged a number of errors of law and fact, which can be categorised as delay grounds; reasonable person grounds; unreasonable assumption grounds; prejudice grounds; miscarry of discretion grounds; finding of fact grounds; and incorrect approach grounds

In the appeal, the Supreme Court was limited to a consideration of the specific allegations of error, and did not conduct a merits review of whether the ERD Court afforded appropriate weight to each matter it considered. It was not open to the Supreme Court to allow an appeal because another decision maker may have made a different decision on the facts; the Supreme Court ought not read the EDR Court's reasons "minutely and finely with an eye keenly attuned to the perception of error". 

The Appellants were required to, in respect of each ground of appeal, satisfy the Supreme Court that the exercise of discretion by the ERD Court resulted in either a process error or an outcome error of the type enunciated by the High Court in House v the King (1936) 55 CLR 499. 

A process error will be established, where the ERD Court acted upon wrong principle, took into account an irrelevant matter, was mistaken as to a fact, or failed to account for a relevant consideration. An outcome error will be established, where a process error is not identified but the Court is nevertheless satisfied that the ERD Court's decision was so unreasonable or plainly unjust that the Court may infer that there was a failure to properly exercise discretion.

The Supreme Court held that the non-exhaustive discretionary considerations involved in determining whether to grant an extension application include whether there has been a material change in the relevant development plan, planning legislation, or circumstance affecting the grant of the extension; whether the applicant pursued the development with diligence; and any other circumstance, which may have frustrated the pursuit of the development. 

The Supreme Court held that a consideration of prejudice to the public interest will only arise, where there has been a change to the relevant planning regime in the 12 months following the grant of a DPC.

The Supreme Court did not find the ERD Court to have erred in law or in fact in respect of any of the grounds of appeal. It was agreed between the parties that the Supreme Court therefore did not need to consider the matters alleged in the Council's notice of alternative contention. 

DPC and extension application 

The Council granted in March 2019 a DPC for the construction of two two-storey residential flats, with each flat to comprise two dwellings with associated car parking and landscaping (proposed development) on land located at South Plympton, South Australia. 

Due to alleged market and economic viability concerns, the Appellants had not acted upon the DPC within the 12-month operative period prescribed by regulation 48 of the Development Regulations 2008 (SA), and nine days prior to the DPC lapsing, made an extension application. 

The Council refused the extension application because the Appellants did not submit evidence of their preparation for demolition or division work, or their pursuit within the operative period of the DPC of obtaining a building rules consent (BRC) as required under section 33(1) of the Act. 

ERD Court's decision to dismiss the appeal

In Paul & Anor v the Corporation of the City of Marion [2020] SAERDC 33, the ERD Court held that the relevant factors to be considered in an extension application appeal were the length of, and reasons for, the delay in making the extension application; whether the relevant approval was pursued with due diligence; whether there had been a change to the planning regime; any prejudice that may flow from a decision to allow the extension; and any other appropriate factor. 

Too much delay, too little diligence 

The ERD Court held that the Appellants did not, due to their own decisions regarding the suitability of the property market and viability of the proposed development, allow sufficient time, which would have been at least four months prior to the expiration of the DPC, to enable a BRC and development approval to be obtained. 

The ERD Court considered it reasonable to expect the Appellants, as experienced developers, to be capable of obtaining advice and informing themselves about any uncertainty of gaining an extension, and to have made contact with Council when they decided not to implement the DPC. 

The ERD Court held that it was unreasonable for the Appellants to assume that an extension of the DPC would be automatic, particularly given their experience with other property in the Council area. 

Amended Development Plan will not prejudice the community or the Council 

The Development Plan dated 28 April 2016 was in force when the DPC was granted. The Development Plan dated 15 August 2019 transferred the Subject Land from the Medium Density Policy Area 12 to the Marion Plains Policy Area 8 of the Marion Residential Zone. 

The re-zoning of the Subject Land increased the desired minimum site area for a residential flat from 250 m2 to 350 m2. It was agreed between the parties that the proposed development would be unlikely to be approved, were an application made under the 2019 Development Plan.

The ERD Court held that to allow an extension application for development that is at odds with the current planning regime would prejudice the public interest. However, in the circumstances, any prejudice would not be "of great order" because the Appellants were willing to commit to an extension period of less than 12 months, and there was an expectation that there would be applications lodged under the prior Development Plan still undergoing assessment.

Appropriate factors submitted by the parties do not assist the ERD Cour

The ERD Court did not consider relevant in a hearing de novo for an extension application the Council's submission that the DPC was a "bad consent" due to the failure of the Appellants to make an application to divide the land, and the Council, at the time of giving the DPC, not having the opportunity to determine whether the Subject Land was suitable for division. 

The ERD Court dismissed the Appellants' complaint that they ought to have been notified of the changes to the Development Plan, finding that the Appellants were more than the average ratepayer, and in any event, development plans are constantly changed and development applicants, and the community at large, bear the burden of informing themselves about those changes. 

The Appellants' lack of diligence and the changes to the Development Plan outweighed the ERD Court's consideration of other discretionary factors relevant to the appeal. 

Appellants' grounds of appeal to the Supreme Court 

The 14 grounds of appeal submitted by the Appellants in the Supreme Court, were reduced to the following 13 grounds in the course of the hearing: 

  • Delay: grounds 2 and 3 – The ERD Court erred in law in finding that the making of the extension application was delayed and erred in fact in failing to find any delay short. 

  • Reasonable person: grounds 4, 6 and 10 – The ERD Court erred in law in its logic and application of the reasonable person test in finding that the Appellants ought to have known to make an extension application four months before the lapse of the DPC, and by not accepting that it was reasonable in light of the market conditions for the Appellants not to take steps to obtain a BRC and development approval before the lapse of the DPC. 

  • Unreasonable assumption: ground 5 – The ERD Court erred in fact or in fact and law in finding that it was unreasonable to assume the DPC would be extended automatically. 

  • Prejudice: ground 7 – The ERD Court erred in fact in failing to find that the Appellants would suffer substantial prejudice, should the extension application not be granted. 

  • Miscarry of discretion: grounds 8 and 9 – The discretion of the ERD Court miscarried or was legally unreasonable or wrong, and the ERD Court erred in law by effectively "punishing" the Appellants for their failure to seek an extension application earlier. 

  • Finding of fact: ground 12 – The ERD Court erred in fact in finding that the Appellants had decided that the proposed development was not viable and was unlikely to be viable for the foreseeable future; by speculating about the potential loss to be incurred, should the proposed development proceed; and by failing to find that the development of three or less dwellings on the Subject Land would result in a loss for the Appellants, whereas the proposed development would have a real likelihood of returning a profit, or minimising the loss to be incurred by the Appellants, when compared to other scenarios. 

  • Incorrect approach: grounds 13 and 14 – The ERD Court erred in law in requiring the Appellants to demonstrate a requisite commitment to the proposed development and by affording determinative weight to the finding that the Appellants had displayed a lack of diligence or commitment to the proposed development. 

Supreme Court's determination

The Supreme Court did not find a process error or an outcome error in respect of any of the grounds of appeal, and held as follows: 

  • Delay: grounds 2 and 3 – The ERD Court followed clear judicial authority in finding the extension application was delayed, and made no finding as to the delay being "short". 

  • Reasonable person: grounds 4, 6 and 10 – The ERD Court did not fail in its reasoning nor impute a high level of technical proficiency and foresight to the reasonable person. It was open to the ERD Court to find unreasonable the steps taken by the Appellants, including the Appellants' evaluation of the property market and the decision by the Appellants not to proceed with the DPC until they thought it was commercially viable to do so. 

  • Unreasonable assumption: ground 5 – The ERD Court was correct to find the Appellants unreasonable for assuming an extension would automatically be exercised in their favour. 

  • Prejudice: ground 7 – The ERD Court found and gave weight to the fact that the Appellants would be prejudiced in excess of $66,000, should it dismiss the appeal. 

  • Miscarry of discretion: grounds 8 and 9 – There was no error in the approach of the ERD Court or suggestion that the ERD Court attempted to punish the Appellants.

  • Finding of fact: ground 12 – The contentions that the ERD Court erred in finding that the proposed development was not viable and would potentially cause the Appellants loss if carried out be rejected. The Supreme Court held that the ERD Court's assessment of prejudice to the Appellants need not specifically refer to the loss to be incurred for other development proposals, and thus there was no error of factual finding, as alleged. 

  • Incorrect approach: grounds 13 and 14 – There was no error or inconsistency in the approach of the ERD Court in weighing each discretionary matter it considered, and its decision was not so unreasonable that no reasonable decision maker could have made it. 

Conclusion

The Supreme Court was not satisfied that the considerations of the ERD Court in deciding the extension application were the subject of a process error or an outcome error, and dismissed the appeal.

The approach of the South Australian ERD Court can be compared with the approach of the Queensland Planning and Environment Court to an application for the extension of a development approval. 

The case of Room2Move.com Pty Ltd v Western Downs Regional Council [2019] QPELR 1010 (Room2Move) concerned an appeal to the Queensland Planning and Environment Court (P&E Court) against the refusal by the Western Downs Regional Council of an application to extend the currency period of a development approval for a development permit for a material change of use of land to establish a non-residential workforce accommodation. 

The P&E Court confirmed in Room2Move that section 86 and section 87 of the Planning Act 2016 (Qld) (PA) confer a broad discretion on an assessment manager to assess and decide an application for the extension of a development approval. 

The P&E Court held the following to be relevant to an extension application made under the PA: 

  • "any matter that the assessment manager considers relevant" (see section 87(1) of the PA), which includes matters irrelevant to the assessment of the development application; 

  • whether the development the subject of the development approval has commenced; 

  • whether there is an explanation for development not being commenced before the lapse of the approval, and the explanation provided by the applicant, including where the explanation relates to the private economics or personal circumstances of the applicant;

  • whether there is a town planning, community, and economic need for the proposed development; 

  • whether there is "a town planning imperative for the development, and its approval to be the subject of a fresh assessment and decision under the PA"; 

  • a determination of the extension application, which will advance the purpose of the PA. 

The P&E Court was satisfied in Room2Move that the Applicant's delay in progressing the approval was because of the unfavourable economic conditions, which resulted from a downfall in the demand for workers' accommodation, and was beyond the Applicant's control. There was also an overriding need for the development, and therefore the Court granted the 12 month extension sought. 

The approach of both the P&E Court and the ERD Court to an extension application under each State's respective planning legislation to extend the period an approval is in force are similar. The only notable difference in approach is the ERD Court's emphasis on whether an approval was pursued with "due diligence". However, both Courts accept that there is a non-exhaustive list of discretionary matters, depending on the circumstances of each case, which may be taken into account in determining an extension application. 

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 2021.

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