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Planning and environmental issues

Planning

Which government authorities regulate planning and zoning for real estate development and use in your jurisdiction and what is the extent of their powers?

The vast majority of planning and zoning law occurs at the local council level, with state laws governing the processes and requiring final state approval of locally developed controls. The state governments intervene in matters of state significance – for example, state-based zoning controls may apply to specific types of land use, either to encourage and facilitate such use (eg, affordable rental housing or housing for seniors) or to provide uniform controls for high-impact land uses (eg, mining, or offensive or hazardous industry). Even where state-mandated controls apply, the consent authority for development is usually still the local council or regional body (depending upon the cost of the development). 

Although this varies somewhat between jurisdictions and it is difficult to generalise, the states tend to limit their involvement to a strategic level in land use planning and rarely act as an approval body for private development. Some exceptions apply – for example, state-significant sites in New South Wales and subdivisions in Western Australia.

What are the eligibility, procedural and documentary requirements to obtain planning permission?

Different procedural and documentary requirements apply in each jurisdiction. A landowner, or any person with consent from the landowner, is eligible to seek planning permission from a consent authority.

A risk-based approach applies: developments of greater environmental impact are subjected to more rigorous assessment and notification requirements, and require more onerous environmental justification and documentation.

Applicants typically provide:

  • a completed application form;
  • building and site plans;
  • the owner’s consent;
  • a report setting out a general overview of the development and an assessment of its compliance with the relevant zoning and development controls;
  • a cost of works estimate;
  • any other expert reports relevant to the development (eg, heritage impact, acoustic, waste management and traffic); and
  • payment of fees.

Upon receipt of an application, the consent authority will assess it against applicable local, state or federal planning controls, notify the development for public comment, request further information if necessary and then approve or refuse the application. 

Can planning decisions be appealed? If so, what is the appeal procedure?

Yes ‒ decisions in relation to developments can be appealed. Different procedures apply in each state and territory: some have a specialist court that deals with development matters and others have tribunals. An appeal can also be commenced in relation to a ‘deemed refusal’ if the relevant authority has not determined the application within the time specified in the relevant legislation. Relatively short deadlines are provided for the commencement of an appeal – as short as 20 business days in Queensland and a more generous six months in New South Wales. Only very limited rights of objector appeal exist. Decisions in relation to zoning matters cannot be appealed in most Australian jurisdictions.

What are the consequences of failure to comply with planning decisions or regulations?

Failure to comply with planning decisions and regulations can result in a range of different sanctions, including:

  • a monetary fine issued by the local council or police;
  • an order to compel certain action;
  • a claim for injunctive relief; 
  • civil enforcement proceedings; or
  • criminal prosecution in a court, tribunal or competent jurisdiction. 

What regime governs the protection and development of historic and cultural buildings?

There are four levels of historic buildings and places: world, national, state and local. In general, the redevelopment opportunities for such sites are limited, and increasingly so the higher the level of the site. Exempt and complying development generally cannot be carried out on a heritage item or within its curtilage and any work will require approval, which must consider the impact of the work on the heritage significance of the building. All heritage sites have their own statement of significance, and the development of a detailed formal conservation management plan is encouraged and generally required as part of any development proposal. A conservation management plan will comprehensively assess and grade the relative significance of various parts of the building fabric and contain statements about appropriate future uses and potential alterations or extensions to the site.

World and national heritage sites are regulated at federal level. Any action that may affect their significance must be referred to the federal environment minister, who will determine what further assessment and approvals are required.

Works to state heritage sites require referral to, and potential approval of, the state heritage office, and local sites are regulated by local planning laws administered by local councils and regional consent authorities.

Places of natural and indigenous heritage value are also protected under heritage laws.

Government expropriation

What regime applies to government expropriation of real estate?

The Commonwealth of Australia and each state and territory have their own discrete laws in relation to the expropriation of real estate. The federal and state legislation differs in detail and often in principle. Certain government agencies (acquiring authorities) are empowered to acquire land for a public purpose in accordance with the relevant compulsory acquisition legislation. There is always a right of appeal against the amount of compensation offered and, in some states, there is also a right of objection to the acquisition itself.

What is the required notice period for expropriation and how is compensation calculated?

The notice process and period for expropriation differ in each jurisdiction, from three to 12 months. If the acquiring authority does not exercise its powers to acquire the land, the notice expires. The compensation offered by the acquiring authority is calculated in accordance with the heads of compensation in the relevant legislation. There is generally a guarantee that this will not be less than the market value. Usually a claim can also be made for disturbance and for an additional solatium payment to residential owners for the disadvantage resulting from relocation. Compensation may also be claimed for business losses and relocation costs in the case of acquisition of commercial property.

Environmental issues

What environmental certifications are required for the development of real estate and how are they obtained?

Australian environmental law takes a risk-based approach to environmental certification, meaning that higher-impact developments go through more rigorous environmental approval processes.

State legislation will identify triggers for environmental approvals, which are ordinarily obtained through the development approval process. In other words, a development application will seek not just planning approval, but also the relevant environmental approvals, as separate but related applications to the relevant government agencies.

For example, developing real estate in the vicinity of a riparian waterway may trigger a requirement for environmental agency approval. This approval may be conditional on compliance with certain conditions, such as the imposition of a buffer zone.

A Commonwealth government approval may also be required if there is likely to be an effect on a ‘matter of national environmental significance’. For example, if there is likely to be an effect on a world heritage item such as the Great Barrier Reef then the federal government is required to give its approval to the development.  

What environmental disclosure obligations apply to real estate sales?

The conveyancing legislation of each jurisdiction sets out the mandatory disclosure matters for real estate transactions. There is generally no positive obligation to disclose the environmental status of the land in the legislation. Beyond what is set out in legislation, there is no duty for a seller to disclose defects in the property (eg, contamination). However, it is common and recommended practice for the vendor to disclose any environmental issues with the property regardless, as failure to do so can be actionable under the common law or other legislation (eg, trade practices and consumer law legislation) on another basis, such as misrepresentation or misleading conduct. If the vendor chooses not to disclose, it must be aware of pre-contractual representations by its agent and other persons involved in the marketing and sale, and must ensure that it has robust contractual disclaimers to protect it against the risk of a future claim.

What rules and procedures govern environmental clean-up of property? Which parties are responsible for clean-up and what is the extent of their liability?

Land contamination is usually identified and remedied through the development approval process. This is because proposing a change of land use is an appropriate trigger for studying the extent of any existing contamination and the clean-up required to make the land suitable for its proposed use.

Where clean-up of the property is required as a condition of development approval, the party undertaking the development will be responsible for the clean-up.

However, all states have powers to require environmental clean-up of land absent any proposed development if certain significance thresholds are met – usually if there is the risk of off-site migration of contaminants, or if the contamination presents a threat to human health or the environment. In this case, clean-up laws can be onerous on landholders, even if they did not cause the contamination.

Although the ‘polluter pays’ principle generally applies in theory, in practice it is often the landowner which is ultimately responsible for the clean-up costs of historic contamination. The landowner will have a cause of action to recoup these costs from the polluter, if it can be found and a cause of action established. In practice, this is rare.

This is because the legislation is pragmatic and expedient, and does not require the regulator to prove liability at common law before liability for clean-up under the legislation can be imposed.

Development approvals and environmental licences can also impose conditions which require land users to return a site to a particular standard on cessation of the use. For example, a petrol station may be required to decommission underground storage tanks and undertake remediation.

Are there any regulations or incentive schemes in place to promote energy efficiency and emissions reductions in buildings?

The national Building Energy Efficiency Disclosure Act 2010 (Cth) requires owners of commercial office space with a certain net lettable area to obtain a building energy efficiency certificate and disclose it to prospective tenants and purchasers before leasing or selling the space (as applicable). This certificate provides an energy efficiency rating based on the National Australian Built Environment Rating System, which provides an environmental impact rating for existing buildings. Significant financial penalties apply for non-compliance. For new buildings, the Nationwide Home Energy Rating Scheme demonstrates compliance with the Minimum Energy Efficiency Standards in the Building Code of Australia for new residential buildings and major alterations and additions to existing buildings.

Notably at state level, New South Wales has adopted an additional scheme for all residential developments (including minor alterations) called the Building Sustainability Index, which requires certification of compliance with benchmarks for water consumption, greenhouse gas emissions and thermal performance for developments costing A$50,000 or more.

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