In Hinkler Ave 1 Pty Limited v Sutherland Shire Council [2023] NSWCA 264 (Hinkler), the Court of Appeal confirmed the long-standing principle that development applications are not “made” until the lodgement fees for the applications have been paid. This case addressed the applicability of a savings provision under the State Environmental Planning Policy (Housing) 2021, emphasising the distinction between submitting and completing a DA under the Environmental Planning and Assessment regulation. For this reason, it is crucial that applicants are aware of their responsibilities in regard to development applications.
FACTS
Hinkler concerned an appeal against the deemed refusal by Sutherland Shire Council (Council) of a development application (DA) for the construction of a mixed-use development under s 8.7(1) of the Environmental Planning and Assessment Act 1979 (EP&A Act). The DA proposed, among other things, to dedicate a portion of the units as affordable housing.
In the Land and Environment Court (LEC), the Applicant asked the LEC to separately determine whether the DA should be assessed under the State Environmental Planning Policy (Housing) 2021 (2021 SEPP) or the State Environmental Planning Policy (Affordable Rental Housing) 2009 (2009 SEPP). If the DA ought to be assessed under the 2021 SEPP, the applicant would be required to dedicate some of the units as affordable housing for a significantly longer period of time.
The Applicant submitted that a savings provision under the 2021 SEPP excluded it from development applications “made, but not yet determined” before the commencement of the 2021 SEPP on 26 November 2021. Council contended that the DA had not been “made” by 26 November 2021, for reasons including that the Applicant had not paid the lodgement fee for the DA by 26 November 2021.
The following is the timeline of key facts of Hinkler:
- 22 October 2021 – the Applicant lodged the DA via the NSW Planning Portal (Portal) pursuant to clause 50 of the Environmental Planning and Assessment Regulation 2000 (2000 Regulation);
- 5 November 2021 – the Council failed to make a determination of the fee to accompany the DA within 14 days of it being lodged as required by clause 256 of the 2000 Regulation, nor did it “reject” the DA within 14 days after receiving it as provided for under clause 51 of the 2000 Regulation;
- 26 November 2021 – the 2021 SEPP came into effect;
- 2 December 2021 – the Council advised the Applicant of the lodgement fee payable for the DA;
- 9 December 2021 – the Applicant paid the lodgement fee.
At first instance, Moore J in the LEC found the development was not “made” until 9 December 2021, when the 2021 SEPP had come into effect, and the DA was therefore subject to the 2021 SEPP.
On appeal, the Court of Appeal unanimously confirmed the LEC’s findings. The judgments of both Basten AJA and Preston CJ adhered to the longstanding position of the Court as reflected in Botany Bay City Council v Remath Investments No 6 Pty Ltd [2000] NSWCA 364 (Remath), notwithstanding there have been legislative changes since Remath to the ways DAs are made (now via the Portal).
The Court of Appeal emphasised that a DA is ineffective and incomplete until after payment of the prescribed fee. Whilst the Council had power to “reject” the DA within 14 days, the fact that such power was not exercised did not render the DA effective or complete, without payment of the lodgement fee. The Court also found that Council’s failure to determine the application fee within 14 days did not cure the incomplete DA. In this regard Preston CJ endorsed Moore J’s comments that the Applicant should have commenced Class 4 proceedings in the LEC and seek an order in the nature of mandamus to compel the Council to determine the lodgement fee. Ultimately, the Court of Appeal found that the DA had not been “made”, for the purpose of applying the savings provision of the 2021 SEPP, until after the application fee had been paid and dismissed the appeal.
The Implication of Hinkler
- Distinguishing between “lodgement” and “made”
Since Remath the Court has distinguished between a development application being “lodged” and being “made” – and the mere fact that an application form has been submitted to a consent authority does not by itself complete the lodgement process, or create a complete and effective development application. Hinkler confirmed this approach is still held under the 2000 Regulation.
- Provisions of 2021 Regulation
The 2000 Regulation has, of course, been repealed and replaced by the Environmental Planning and Assessment Regulation 2021 (2021 Regulation).
The 2021 Regulation contains provisions that are similar to the 2000 Regulation for the making of development applications, but those provisions have a number of subtle differences. For example, whilst clause 50(1) of the 2000 Regulation requires a development application to be “lodged” on the planning portal, clause 21(1) of the 2021 Regulation requires a development application to be “submitted” on the NSW planning portal. Clause 21(3) of the 2021 Regulation stipulates –
“a development application lodged—
- On the day on which the fees payable for the development application under this Regulation are paid, or
- if the application is notified under Part 13 that no fee is required – on the day the applicant submitted the application on the NSW planning portal”.
Councils may, as they did under the 2000 Regulation, “reject” a development application within 14 days after receiving the application under certain circumstances (Clause 39(1) of the 2021 Regulation). A rejected application is taken never to have been “made” (clause 39(2) of the 2021 Regulation).
Under clause 256 of the 2021 Regulation, Councils continue to have legal obligations to determine the fees payable for a development application. Whilst clause 256 of the 2000 Regulation required the consent authority to determine the fee payable “before, or within 14 days after, the application is lodged on the NSW planning portal”, clause 256 of the 2021 Regulation now requires such fees to be determined before or within 14 days after they are “submitted” on the NSW planning portal.
- 2 stages in making a development application
These subtle changes made in the 2021 Regulation make clear that there are two distinct stages in the making of a development application. Firstly when a development application is “submitted” on the planning portal, where the relevant documents are registered, and secondly, when a development application is “lodged”, once the fees for the development application are paid. By distinguishing between the “submission” and “lodgement” of a development application on the planning portal, the 2021 Regulation reinforces the key principle established in Remath and Hinkler: that merely registering documents on the planning portal does not constitute the complete lodgement of the development application.
- Determination of lodgement fees
However, the 2021 Regulation did not address a critical issue that the Applicant in Hinkler raised regarding the 2000 Regulation. In Hinkler, the Applicant contended that the Council had denied them the benefit of the savings provision in the 2021 SEPP by delaying the determination of the application fee.
In this regard Moore J in the LEC had remarked that even if the Council ought to have determined the application fee within 14 days from when the development application was lodged, the Applicant was still “the architect of its own fate” because it could have commenced proceedings and sought an order to the effect of mandamus to compel the Council to determine the application fee.
Clause 256 of the 2021 Regulation still requires Council to determine the lodgement fees within 14 days of an application being “submitted” on the planning portal, but it does not specify any direct consequences for a delay or failure in determining the application fee. As a result, an applicant may still “miss out” on the benefit of a savings provision if the development application is “submitted” on the planning portal before a new instrument takes effect, but the determination of the application fee is delayed beyond 14 days. In this circumstance, it appears that seeking an order to the effect of mandamus remains the only option for applicants effected by such a situation. Whilst the risk of incurring an adverse costs order could bring incentives to Councils to determine the application fee within the 14-day period, especially if an applicant successfully obtains an order for mandamus, the uncertainty surrounding the introduction of new instruments the lengthy nature of mandamus proceedings raise questions about the effectiveness of this option for applicants.
