Local Government Legal

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January 2015 – Court of Appeal: a Construction Certificate can be inconsistent with the Development Consent

In a recent decision which will have ramifications for Local Government, the Court of Appeal in Burwood Council v Ralan Burwood Pty Ltd (No. 3) [2014] NSWCA 404, held that a construction certificate (CC) which is inconsistent with a development consent and as such in breach of clause 145(1) of the Environmental Planning & Assessment Regulation 2000 (the EPA Reg) or section 109F(1)(a) of the Environmental Planning & Assessment Act 1979 (the EPA Act), will not necessarily be held to be invalid.

Therefore, it would seem that a developer having the benefit of a development consent is entitled to rely upon a CC issued by an accredited certifier notwithstanding the fact that it may be inconsistent with the development consent. That is, the CC notwithstanding the inconsistency would be nonetheless valid and a developer by virtue of the provisions of section 80(12) of the EPA Act would be entitled to carry out the development in accordance with the plans annexed to the CC and would be not in breach of section 76A(1) of the EPA Act in doing so.

Ralan Burwood Pty Ltd (Ralan) purchased land in Railway Parade, Burwood that had the benefit of a development consent. In carrying out the development, Ralan contracted Steve Nolan (Nolan) to construct the development and Nolan in turn engaged Stephen Bowers (Bowers) as an architect to prepare the CC plans. Bowers made changes to the approved plans in order to improve the amenity and appearance of the building and to reduce the construction costs. The CC was subsequently issued by a private certifier and the CC plans contained the changes which altered a number of features in the building, particularly relating to the facade.

When the building was substantially completed Burwood Council commenced proceedings in the Land and Environment Court alleging that the CC plans were inconsistent with the development consent and were as such invalid and that Ralan was in breach of the development consent. Sheahan J after a lengthy hearing initially held that the CC plans were not inconsistent with the consent and as such were valid. He also held that even if the CC plans were inconsistent, Ralan was not responsible for any breach because it had taken a passive role in carrying out the development. Therefore, the Court refused to make the declarations sought by the Council and the Council subsequently appealed to the Court of Appeal.

In considering the Appeal, the Court of Appeal examined the following aspects:-

  1. The inconsistency between the CC and the development consent;
  2. The validity of the CCs; and
  3. Whether Ralan was responsible for any breach of the development consent.

In relation to the inconsistency of the CCs with the development application plans, it set aside Sheahan J’s finding that the CCs were not inconsistent with the development application holding that it had been affected by error. It held that he did not apply the correct test for determining whether the two sets of plans and specifications were “not inconsistent”. Notwithstanding that fact, the Court held that it could not resolve the disputed factual issue as these had not been resolved by the primary Judge and it would not be possible for the Court to make findings necessary to resolve the question.

In relation to the issue of Ralan’s responsibility for any breach, the Court also held that Sheahan J’s finding that Ralan could not be held responsible should be set aside. Although the Court accepted that Ralan did not physically carry out the construction works, it had played a role in the development by purchasing the property with the benefit of the development application, planning the project, engaging the builder pursuant to a formal contract (which included the appointment of a superintendent empowered to give directions and to enable access to the site), and benefitted from completion of the project. For these reasons, it held that the primary Judge had erred by applying the test of knowing involvement in a contravention and that is not the test under section 123 of the EPA Act.

In relation to the invalidity of the CC issue, the Court held that the scope and object of the legislation construed as a whole does not require a CC issued in breach of section 109F(1)(a) of the EPA Act and clause 145(1) of the EPA Reg to be held invalid. It suggested that the scheme of the legislation (being the EPA Act in conjunction with the Building Professionals Act 2005) suggests that the matter should be dealt with as a disciplinary matter relating to the accredited certifier rather than by the blunt mechanism by rendering a non-complying CC void.

In response to a submission from the Council that the validity of a CC issued in breach of the EPA Act could create a risk to public health and safety, the Court indicated that the Consent Authority and Council receive not only the determination and the certificate issued, but the plans and specifications and any fire safety schedule. Therefore, the recipient has the opportunity to scrutinise the CC and accompanying documentation to determine whether there is a departure from the development consent or a risk to public safety that might warrant intervention and the invocation of statutory powers such as the issuing of an order under section 121B of the EPA Act.

This decision is likely to create some unrest for Local Government in that the final form of development as built may be quite different from that approved in the development application. Nevertheless, an inability to invalidate the CC will mean that developers will not be in breach of the development consent and an order to rectify the inconsistencies will not be able to be obtained from the Court. The Council and the public will have to be satisfied with an ability to seek disciplinary sanctions against the accredited certifier unless there is a successful appeal to the High Court or a legislative change.

Note: This information is not to be relied upon as legal advice.

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