Unclear definitions create risk for development

Unclear definitions create risk for development

December 22, 2016 Uncategorized 0 Comments

Experienced town planners understand the importance of checking the meaning of land use definitions in town planning controls to protect their clients from risk and missed opportunities.  

Without giving proper attention to the meanings of words and phrases, property owners can face considerable risk, even for exempt or approved developments. Alternatively, opportunities to gain approval can be missed.

Different approaches in different town planning instruments

In NSW planning law, “Environmental Planning Instruments” and “Development Control Plans” differ greatly in terms of how particular they are in the use of language.

“Environmental Planning Instruments” include “Local Environmental Plans” and also “State Environmental Planning Policies”.  Those instruments include provisions that are law. Such provisions cannot be treated flexibly to accommodate “common sense” interpretations. Sometimes, however, a variation can be made to those provisions by following a specific variation process.

“Purposive interpretation” – leave it to legal experts

In some situations the Court will apply a “purposive interpretation” of land use definitions.  However, purposive interpretation seems to be limited to situations in which a provision leads to a nonsensical outcome when applied literally. A purposive interpretation is required to make sense of it.

All town planning consultants and their clients should seek legal advice before relying on any such “purposive interpretation”.  Our idea of a nonsensical outcome might be very different to how the Courts would view such an outcome.  

The following case studies outline five key risks resulting from unclear town planning definitions:

To explain some of the issues involved with definitions of land uses, it is best to consider some examples.


Case study 1:  “Functions centres” and “restaurants” – presuming permissibility creates financial risk

The long-term lessee of a restaurant within a public reserve engaged MB Town Planning to modify their development consent to expand the patron capacity of their restaurant.

The use of their restaurant was permitted via the exceptions clause within their Local Environmental Plan.  That clause permitted “restaurants” but did not permit “function centres”.

By reviewing the consent history of the use, we found Council had initially approved a new restaurant on the site (along with amenities for park users).  Council had later approved a modification to the consent to include a “function area” on the ground floor level, prior to our engagement.

The function area was larger than the seating area of the restaurant upstairs.  It was not internally connected to the upstairs restaurant (other than by a small goods lift for transporting meals – i.e. a dumb waiter).

A casual approach creates risk

Our client asked us to apply for a modification to development consent to increase the number of patrons within the function area.  Through our investigations we identified that Council had taken an overly casual approach in approving the first modification that created a “function area”.

The town planning consultant engaged on Council’s behalf to assess the initial proposal for a ‘function area’ did not acknowledge the permissibility of a ‘function area’ as being worthy of comment.  The consultant’s report also did not carefully assess whether the development was “substantially the same development” as the originally approved development.  

By the time that MB Town Planning met with Council to discuss a further increase in patron capacity, Council had become aware of the problem with what they had approved (on their own land).

Careful investigations identified the problem

MB Town Planning carefully investigated questions around the distinction in meaning between a “function centre” and a “restaurant”.  We then briefed and engaged two lawyers to provide advice on the issue at different stages.

Don’t rely on common sense!

“Common sense” would indicate that a restaurant will sometimes, in effect, operate as a “function centre”.  For example, many restaurants have an upstairs room that can be booked out by a single party where that party can have people giving speeches and the like.

Ultimately, Council could not be persuaded to approve the expanded numbers because it would have increased the intensity of the function area to the point that Council thought it would not have been operating as part of the “restaurant”.

Strategies to address the problem

The real problems arose when our client had not factored in the permissibility of a “function centre” into their financial plans at the beginning of their project.

We advised our client to apply for an amendment to the Local Environmental Plan to include “function centre” in the permitted uses.  

Conclusion – work from a solid legal foundation

Whilst the issue escaped unnoticed by Council on the first occasion, ultimately the issue caught up with our client.  It is best when projects have a solid foundation in land use planning law rather than relying on Councils to ignore or fail to detect a problem.


Case study 2:  High technology industry, industry and office premises 

It is important that the permissibility of a land use takes into consideration the particular instrument under which the use was and is approved.

Prior to Sydney Local Environmental Plan 2012 coming into effect the principal environmental planning instrument for most of the suburb of Alexandria was South Sydney Local Environmental Plan 1998.

Under the 1998 instrument, no uses were prohibited (with a couple of exceptions).  However, some uses were specifically permitted (with consent) whilst others were only be permitted by default (they were not prohibited).  

Uses that were specifically permitted (with consent) were given more favourable treatment than prohibited uses.

“High technology industry” was specifically permitted with consent.  However, “commercial premises” (including offices) were only permitted by default and were not encouraged.

The definition of “high technology industry” included, amongst other things, research and development of things such as pharmaceuticals, technology, or even information technology or software.  This meant that a use that simply involved the development of information technology was defined as “high technology industry”.  Yet such a use would today be regarded as an “office” for town planning purposes.

Sydney Local Environmental Plan 2012 today defines “high technology industry” in a way that it must involve “an industrial activity”.  “Industrial activity” can still involve only research into (amongst other things) information technology – however, it must involve “goods, substances, food, products or articles”.  It must therefore (in the opinion of MB Town Planning) involve physical products and would not include, for example, solely people sitting at a desk carrying out software development.  In comparison, the earlier definition of “high technology industry” did, in the opinion of MB Town Planning, include people sitting at a desk engaging in software development (for example).

Those circumstances created an opportunity for owners of certain land in Alexandria to establish uses that were like an office, but using the label “high technology industry” to curtail Council’s opposition.  

When South Sydney Local Environmental Plan 2012 came into effect, those “high technology industry” uses would be able to be re-evaluated and defined as “office premises”.  Owners of land containing such a use could then potentially apply for alternative commercial uses on the basis of “existing use rights”.

In order to increase prospects of succeeding with an application based on existing use rights, the property owner could have established a “high technology industry” under South Sydney Local Environmental Plan 1998; then, prior to Sydney Local Environmental Plan 2012 being implemented they could seek a “complying development certificate” for a change of the “high technology industry” to an alternative office premises use.  That would have been possible because State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 uses the updated definition of “high technology industry”.

Strategies such as set out above are not 100% guaranteed of success.  However, the opportunities existed to potentially allow more flexible use of warehouse-buildings in Alexandria.  Careful consideration of land use definitions can potentially open opportunities and widen the suite of land use options.

In pursuing sophisticated strategies like that described above, landowners or proponents should factor in the possibility of the consent authority or Court taking a different perspective – for example, a strategy like the above strategy might best be pursued where there is not too much to lose if it does not work out favourably.  


Case study 3:  What is a cabana?

MB Town Planning is aware of cases in which certifiers have allowed a “cabana” to be approved as “complying development”, but where the NSW Land and Environment Court has concluded that the buildings are not a “cabana”.

Subject to certain control (like height, setbacks, area etc) a cabana on the site of a “dwelling house” (which is just a house) can be approved as “complying development” or even in some cases as “exempt development”.  A “complying development certificate” means that the approval is given by a private certifier (or it can be issued by Council) based on compliance with established rules.  

There is no “merit assessment” for a “complying development certificate”.  Either it complies or it does not.  The same applies to “exempt development”.

However, in the case of a “cabana” – there has to be some interpretation because the term is not defined under State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 or elsewhere in the legislation.

Unfortunately, in the case of complying development certificates, that interpretation is left in the hands of private certifiers (or the Council certifier).  Certifiers can obtain town planning advice – but even the town planner will have to rely upon their own interpretation.

Where the meaning of “cabana” becomes contentious is around whether it may be connected to electricity and whether it can be connected to plumbing.  Clearly it cannot be designed as a self-contained dwelling, as there are other provisions that prevent that.  However, in the opinion of MB Town Planning an outbuilding within the rear yard of a dwelling house could have its own WC and washbasin without being able to be used as a separate dwelling.

There have been decisions by the NSW Land and Environment Court on the issue of what is a cabana.

In one decision, Joseph v Lane Cove Council [2012] NSWLEC 1013 Commissioner Morris made a ruling on a structure that had been constructed without any approval. The owner of the structure had applied for a Building Certificate to allow the structure to remain.  Commissioner Morris allowed the structure to remain, but it had to have its plumbing removed and capped.  From that decision, it is implied that the plumbing had to be removed –  otherwise the structure was capable of use as a separate dwelling.  However, as the property owner agreed to that outcome during the course of the hearing it is not certain whether that provides a precedent for all cases involving a cabana having plumbing installed.

The difficulty with leaving a term such as “cabana” undefined is that it puts at risk residents and certifies who may build or approve such structures as exempt or complying development.  The risk is that neighbours may object and Council may intervene with an Order, or there may be a complaint made against the certifier, based upon what is a subjective interpretation.

In the opinion of MB Town Planning, the case could be made that a cabana is often associated with a swimming pool and may contain a WC and shower, because many people like to shower before and after using a swimming pool.  A cabana could also, by some arguments, contain a bbq facility.  However, by other interpretations a cabana must be a much simpler structure, with no service and even with no walls or flooring (i.e. they should have an earthen floor).

It is therefore often necessary to take quite a conservative approach to the interpretation of undefined categories of development.  In many cases the safest option is to apply to Council, even where exempt and complying development may be possible, in order to avoid doubt and to avoid risk of being ordered to demolish the structure.


Çase study 4:  Educational establishments and business premises

An example that frequently comes to the attention of MB Town Planning is the question of whether a private coaching college is defined as an “educational establishment”.

Private coaching colleges provide tuition to adults and children, and generally operate from shop-type premises.

The definition of an “educational establishment” under environmental planning instruments limits them to being either a “school” or “a tertiary institution, including a university or a TAFE establishment, that provides formal education and is constituted by or under an Act”.

There is a separate category for “industrial training establishment” which provides vocational training related to an “industry” but does not include an “educational establishment”.  That would include, for example, a business providing forklift training, for example.

However, there is no definition that clearly relates to a typical private coaching college.

The term “school” is specifically defined to refer to a government or non-government school under the Education Act 1990.  

Some proponents would consider a private coaching college to be an educational establishment if they are providing training on behalf of a TAFE establishment (i.e. where TAFE has outsourced courses to that training college).  However, in the opinion of MB Town Planning that would not mean that the training college is “constituted by or under an Act”.  The courses that they are running may be part of education constituted by or under an Act, but the institution of the coaching college is not so constituted.

The alternative definition of a coaching college and similar, in the opinion of MB Town Planning, is “business premises”.

Those definition have important implications for the permissibility of those uses.  In the case of “business premises” it means that they can potentially be carried out as exempt or complying development.  However, if a place is recognised as an “educational establishment” it might potentially be able to be carried out as “Development Without Consent” under State Environmental Planning Policy (Infrastructure) 2004.

Each case needs to be considered based on the relevant facts for that case.  However, the main message is that it is important not to rely on ordinary or “common sense” interpretations.  Rather, it is necessary to examine the exact wording used in the relevant instrument.


Case study 5:  Animal boarding and training establishments and business premises

As a final example, MB Town Planning has, on multiple occasions, been approached by people wishing to start businesses within business zoned areas involving washing and grooming cats and dogs.

On a “common sense” basis, those uses fit well into an ordinary business area, as long as they have the right facilities, including for temporarily keeping the animals in humane conditions without disturbing the amenity of neighbouring businesses.

Ordinarily, it would seem that animal grooming businesses should be treated as “business premises”.  After all, hairdressers (for humans) are defined in that way.

However, a difficulty comes along with the definition of “animal boarding and training establishment”, which is part of the Standard Instrument.

That definition is “a building or place used for the breeding, boarding, training, keeping or caring of animals for commercial purposes…”  That definition would apply to a typical dog kennels that we normally see within fringe rural areas.  However, in the opinion of MB Town Planning it also applies to an activity as simple as washing a dog, combing its hair and clipping its nails.

The problem with that is that the use is excluded from both business zoned and industrially zoned areas across most of Sydney.  There are some exceptions (for example, the B7 zone within the City of Sydney).  However, for most of Sydney, you would need to drive to a rural area in order to have your dog’s nails trimmed.

The restriction does not seem to apply to mobile dog grooming businesses.  When they are parked at the base of that business, it would be just like having any other vehicle parked there in all likelihood (depending on to what extent other goods are kept on the site).  

The restriction would also not normally prevent dog (and/or cat) grooming businesses that were lawfully established in the past from continuing to operate, as long as they continue in accordance with their original consent.

However, the restriction would apply to new animal grooming businesses.

In one case MB Town Planning advised on the potential operator had been told by their Council that the business would be defined as “business premises”.  That’s fine, but it becomes a problem if the Council changes its mind after it actually receives a development application.  The operator could go to the trouble and cost of leasing premises and preparing and submitting a development application only to find that Council is defining the use as an “animal boarding and training establishment” and as a prohibited use.  Any complaints about the verbal advice received earlier from Council would tend to fall on deaf ears.



The main message is that careful attention needs to be given to the definitions of terms used in environmental planning instruments.  People investigating development options for a site or locational options for a business should not rely on “common sense” interpretations but should instead examine the specific meanings of the terms relied upon.

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