May 2020

When two wrongs don’t make a right

Clause 4.6 variation requests are under the spotlight again. We look at recent case law which considers when a development standard is taken to have been abandoned, and how you deal with the issue of ‘desired future character’.

In recent years, there have been numerous judgments which have considered clause 4.6 variation requests.

We explore here the recent decision of SJD DB2 Pty Ltd v Woollahra Municipal Council [2020] NSWLEC 1112 in which the Land and Environment Court has provided further direction when it comes to dealing with the test of establishing whether a development standard has been abandoned as justification for a clause 4.6 variation request. This decision also considered the impacts of existing nearby developments in determining the ‘desired future character’ of a neighbourhood.

The Proposal

SJD DB2 Pty Ltd (the Applicant) sought consent for the demolition of existing buildings and the construction of a six-storey shop top housing development, with retail on the ground floor, twenty-one residential apartments above, and two levels of basement parking for thirty-six cars and four motorbikes.

The proposed development had a height of 21.21m and a floor space ratio (FSR) of 3.54:1. Pursuant to the height and FSR controls under the applicable Woollahra Local Environmental Plan 2014 (WLEP), this is an exceedance of approximately 44% in relation to height and 41% in FSR.

Importantly, adjacent to the subject site to the east are two approved developments under construction, each to become six storey buildings of a very similar height and floor space to the proposed development. The proposed development was designed with the intention of continuing the line of development from adjoining sites to the east, adopting the same height and general form.

The clause 4.6 variation request submitted by the Applicant put forward the argument that the approval of these adjacent developments to the east amounted to the abandonment of the development standards for the area, and also provided an indication of the desired future character of the neighbourhood.

The Decision

The subject development application was recommended for approval by Council staff however was ultimately refused by the Sydney Eastern City Planning Panel (the Panel), who determined that the clause 4.6 variation request was unsatisfactory, and that the approval of the developments to the east did not amount to an abandonment of the Council’s development standards.

The Applicant sought a review pursuant to s 8.2 of the Environmental Planning and Assessment Act 1979, which resulted in the Panel again refusing the application on essentially the same grounds.

The determination was appealed in the Land and Environment Court. Acting Commissioner Clay upheld the appeal. Of particular interest to us are his findings in respect of desired future character and his acceptance of the clause 4.6 variation request, which we examine below.

Desired Future Character

In considering the question of character, Acting Commissioner Clay focused on the question of “what is the desired future character and is the proposal consistent/compatible with that desired future character?”

The subject site is zoned B2 (Local Centre) under the WLEP, a zone in which shop top housing is permissible with consent. One of the objectives of the B2 zone is to ‘ensure that development is of a height and scale that achieves the desired future character of the neighbourhood’.

The Applicant pointed at the approvals to the east of the subject site as a demonstration of the fact that the proposed development is in line with the desired future character of the area.

Central to its case was the argument that continuing the form of the developments to the east (which are under construction and have proposed heights of 21.21m and 20.75m respectively) would be a better planning outcome than a development on the subject site that strictly complied with the controls, which would be ‘discordant’.

In contrast, the Council looked at the character issue more broadly, considering the whole of the Double Bay Centre as opposed to the block of buildings focused on by the Applicant, and argued that “the approvals to the east of the subject site do not reflect the existing and desired future character of this part of Cross Street when considered in the wider context and having regard to the LEP controls.”

Acting Commissioner Clay agreed with the Applicant on this point, stating that when considering character, the focus should be on the more immediate context of the subject site.

Importantly, the Acting Commissioner made the distinction that this was not a scenario in which an adjacent development had been approved and constructed many years ago, sitting as an anomaly in the street, but rather these developments reflect the recently expressed attitude of the Council to such development. They were approved by Council under effectively the same controls as present, notwithstanding the fact that they exceed the height and floor space ratio controls.

So, with the character being dictated by the adjacent developments to the east, the proposal (being of the approximate same height and form) was found to be consistent with that character, although significantly in breach of the applicable development standards.

The Court’s findings on character are relevant to the way in which it considered the clause 4.6 variation requests. The Acting Commissioner was satisfied that the proposal met:

a. objective (a) of cl 3 (height standard) in that it was consistent with the desired future character of the neighbourhood;

b. objective (b) of cl 4 (FSR standard) in that it was compatible with the desired future character of the area in terms of bulk and scale; and

c. the seventh objective of the B2 zone in that it was of a height and scale that achieves the desired future character of the neighbourhood.

Abandonment of the Development Standards

As established by Preston CJ in Wehbe v Pittwater Council [2007] 156 LGERA 446, one of the five most common ways to demonstrate that the application of standards is unreasonable or unnecessary in a particular scenario is to show that the standard has been abandoned.

In this case, the Court concluded that the development meets the objectives of the development standards notwithstanding the breaches. That said, the Acting Commissioner still stated that when considering whether the relevant development standards had been abandoned, the Court had to again consider whether to look at the recent approvals to the east of the subject site in their immediate context or in the broader context of the Double Bay Centre.

The Council argued that the controls had not been abandoned, as it was only two non-compliant developments that had been approved, and as such the controls that apply to the Double Bay Centre had not been abandoned and should apply to the subject site.

However, the Applicant again argued that the planning controls had clearly been abandoned in this specific area of the Centre, as shown by the approval of the two developments adjacent to the east.

So the question was, how far do you look? Do you confine yourself to the recent approvals in the immediate context of the subject site, or do you adopt a broader approach and consider the wider Double Bay centre area.

The Acting Commissioner agreed with the Applicant, stating “The Council deliberately and knowingly decided that larger buildings were appropriate in the block of which the site forms part. That, in my view, amounts to an abandonment of the controls for this part of Double Bay.”

So the Court, if asked to determine the matter on this issue, adopted the position that the concept of abandoning a control can apply to a part of an area that is the subject of that control, albeit subject to the circumstances of the case.

Learnings for councils

This decision highlights two key considerations for councils.

Firstly, the question of desired future character inevitably will have regard to existing character. When assessing development applications that significantly breach controls, the implications extend to the assessment of future development applications for adjoining land. The “two wrongs don’t make a right” argument in this case was not persuasive in the Court’s eyes.

Secondly, when considering, as a ground to demonstrate that compliance with a development standard is unreasonable or unnecessary, that that standard has been abandoned, it is possible to approach the issue more narrowly. While each case will be assessed on its own merits and circumstances, it is possible to consider a part of an area the subject of the control.

Finally, it is worth noting that the level of exceedance of the standards in this case is a reminder that there is no maximum percentage by which a development standard may be varied. The subject proposal exceeded the standard significantly with the height control by 44% and the FSR control by 41%.

Stay tuned for the next decision that considers clause 4.6 variation requests.

Author: Dennis Loether

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