Delay, procrastination and indecision by consent authorities can be frustrating for developers who want to develop land, whether that be a house, building, or major infrastructure. Holding costs, contractual deadlines and a focus on outcomes all contribute to a developer’s rising concern.

On the other side of the fence, there are also times where consent authorities do not want to make a decision due to the ramifications a decision will have, or uncertainties associated with those consequences. In certain circumstances, this can also be a legitimate concern for consent authorities and decision makers.

A common question asked is whether a consent authority’s decision can be compelled to be made by the Court. Consent authorities must also consider the appropriateness of deferring decisions.

The case of CSKS Holdings Ltd v Woollahra Council [2014] NSW LEC 176 provides some helpful pointers for consent authorities and developers navigating this terrain. It is important because delays in having developments approved impacts the efficiency of construction and development, which impacts on the economy. Equally, premature decision-making, in circumstances where a decision is later found to be invalid, will also cause delays and therefore stifle economic efficiencies, but also create bureaucratic costs and difficulties, not to mention possible political problems. As such it is important to know in what circumstances decisions can be deferred, and when they should be made without delay.

The case

In this case, the applicant was the lessee of Crown land in Paddington. The applicant lodged a Development Application (DA) with Council in March 2013, for site remediation and a new childcare centre. The land owner’s consent was provided by a delegate of the Minister administering the Crown Lands Act 1989 in March 2013.

In April 2014, almost one year since the DA was lodged, the NSW Government ordered an independent review into the transfer of the lease for the subject land to the applicant. Following an assessment report prepared in May 2014 recommending approval (subject to conditions), Council resolved on 26 May 2014 for the consideration of the development application to be deferred until the Minister’s enquiries into the transfer of the Crown lease.

In August 2014, the secretary of the Department wrote to Council’s general manager advising that the review was completed and that the review report had been referred to the Independent Commission Against Corruption for its consideration.

Unsurprisingly, the developer wanted a decision, and the elected Council wanted to defer making a decision until some uncertainties in relation to the owner’s consent were considered further. In this case, the applicant sought an order in the nature of Mandamus requiring the Council to determine the development application.

The judgment

The Court clearly set out that it has jurisdiction under s 20(2)(b) of the Land and Environment Court Act 1979 (Court Act) to:

“review, or command, the exercise of a function conferred or imposed by a planning or environmental law or a development contract.”

The Court set out that the Environmental Planning and Assessment Act 1979 (EPA Act) is a ‘planning and environmental law’ under s 20(3) of the Court Act. There are a range of other pieces of legislation not cited in the judgment but which also fall within this category of law including the Aboriginal Land Rights Act 1983, the Contaminated Land Management Act 1997, National Parks and Wildlife Act 1974, relevant parts of the Local Government Act 1993, the Native Vegetation Act 2003, the Protection of the Environment Operations Act 1997, the Rural Fires Act 1997, the Threatened Species Conservation Act 1995. This means the option of compelling a decision may be available for decisions under these pieces of legislation.

In respect of the Council’s duties, the Court referred to s 80(1) of the EP&A Act which provides that a consent authority is to determine a development application by either granting consent (conditionally or unconditionally) or by refusing consent. Whilst the Court held that the Council could determine the DA given that owner’s consent had been provided by the Department and held that if the Council’s behaviour was unreasonable and/or there was a constructive failure to determine the DA by the Council, the Court could exercise discretion and make an order of Mandamus, ultimately the Court declined to make the order.

The Court held that:

“If owner’s consent is found to have been fraudulently or corruptly granted in this matter there is arguably no valid DA for which development consent can be granted in this case.”

Her Honour went on to state:

“I do not consider the Council has acted unreasonably in deferring the DA as it has done, or constructively failed to determine the DA. Refusing the DA, an option the Applicant submitted was open to the Council, is not properly open. A Council must be clear about the basis on which it is refusing a DA and it is not presently in a position to be clear on the issue of whether owner’s consent was properly granted. The outcome of the ICAC investigation is unknown. As a practical matter, if the DA was refused and an appeal right exercised to the Court under s 97 the same question would presumably arise in any event with similar uncertainty until the ICAC provides findings or advises that it does not intend to investigate the matter.”

Finally, Her Honour stated:

“My finding that the Council has acted reasonably is not undermined by the Applicant’s submission that the owner, namely the Crown, may have avenues available to it, such as preventing the use of the subject land by the Applicant as lessee. I will not speculate on whether such avenues are available in the absence of any evidence.”

Applying this decision

The decision means that Councils and other authorities involved with “planning and environmental law” (or “development contracts”), may in certain circumstances be compelled under a writ of mandamus to make a decision.

At the same time, such authorities may take comfort in the fact that there will be times where it is reasonable not to make a decision. These circumstances will need to be carefully considered for each factual situation where a ‘decision not to make a decision’ is made.