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Karam Boutique Residential 8 Pty Ltd v Redland City Council QPEC 47
PLANNING AND ENVIRONMENT COURT OF QUEENSLAND
Karam Boutique Residential 8 Pty Ltd v Redland City Council  QPEC 47
KARAM BOUTIQUE RESIDENTIAL 8 PTY LTD
REDLAND CITY COUNCIL
Planning and Environment
Hearing of an application
Planning and Environment Court at Brisbane
14 September 2021
17, 18 August 2021
RS Jones DCJ
PLANNING AND ENVIRONMENT – ORIGINATING APPLICATION – where originating application sought development permit concerning building work for demolition of detached house and shed – where development permit granted by respondent – where demolition works not substantially commenced within approved period – where Stop Order issued against demolition permit for non-compliance – where applicant seeks orders that non-compliance be excused – that development permit be treated to expire at the end of a further start period – that commencement of demolition prior to further start period be treated as lawful – where non-compliance excused
DEVELOPMENT PERMIT – DEMOLITION – NON-COMPLIANCE – whether Stop Order caused non-compliance with substantial start provision – precluded exercise of rights under subject demolition approval – whether prejudicial to applicant if non-compliance not excused – where temporary local planning instrument in place – whether subject house in state of extreme disrepair
PUBLIC INTEREST – whether public interest in protection of land and subject house on heritage grounds militates against excusal of non-compliance – whether public interest in individual with benefit of development approval having opportunity to fully exercise rights afforded by such development approval
Acts Interpretation Act 1954 (Qld) s 49A
Building Act 1975 (Qld) ss 71
Planning Act 2016 (Qld) ss 3, 4, 5
Planning and Environment Court Act 2016 (Qld) s 37
Queensland Heritage Act 1992 (Qld) ss 35, 154
Annandale v Cairns Regional Council  QPEC 49; (2020) QPELR 438
Brassgrove KB Pty Ltd v Brisbane City Council  QPEC 42;  QPELR 119
Farrah v Brisbane City Council  QPEC 19;  QPELR 449
Sevmere Pty Ltd v Cairns Regional Council  QPEC 32
Mr A Skoien for the applicant
Ms S Hedge for the respondent
McCarthy Durie Lawyers for the applicant
Redland City Council General Counsel Group for the respondent
- This proceeding is concerned with the hearing of an originating application filed on behalf of Karam Boutique Residential 9 Pty Ltd (the applicant) seeking orders pursuant to s 37 of the Planning and Environment Court Act 2016 (PECA). For the reasons set out below, it is ordered:
- The non-compliance with s 71(2) of the Building Act 1975 arising from the failure to substantially start demolition work within two months of the granting of the demolition approval on 17 November 2020, is excused.
- I will hear from the parties as to further consequential orders.
- Section 71 of the Building Act 1975 (Qld) provides:
- “(1)This section applies to a building development approval for building work to –
- (a)demolish or remove a building or structure; or
- (b)rebuild, after removal, a building or structure.
- (2)The building work must substantially start within 2 months after the giving of approval.
- (3)Within 1 year after the giving of the approval-
- (a)the building work must be completed; …”
- This matter comes before the court because the applicant had not substantially started demolition works within two months after the giving of the building development approval. The reasons for that failure to substantially start demolition works are discussed below.
- The relief sought is the exercise of a discretion to excuse non-compliance pursuant to s 37 of the PECA which relevantly provides:
- “(1)If the P&E Court finds there has been noncompliance with a provision of this Act or enabling Act, the court may deal with the matter in the way it considers appropriate.
- (2)Without limiting subsection (1) and to remove any doubt, it is declared that subsection (1) –
- (a)applies for a development approval that has lapsed, or a development application that has lapsed or has not been properly made under the Planning Act; and
- (b)is not limited to –
- (i)circumstances in relation to a current P&E Court proceeding; or
- (ii)provisions under which there is a positive obligation to take particular action.
- (3)In this section –
Noncompliance, with a provision includes –
- (a)non-fulfilment of part or all of the terms of the provision; and
- (b)a partial noncompliance with the provision.
Provision includes a definition.” (emphasis added)
- Section 49A of the Acts Interpretation Act 1954 provides:
“If a provision of an Act, whether expressly or by implication, authorises a proceeding to be instituted in a particular court or tribunal in relation to a matter, the provision is taken to confer jurisdiction in the matter on the court or tribunal.”
- In the proceeding before me, the issue of jurisdiction was not raised. That is, both sides of the bar table seemed to proceed on the basis that the jurisdiction of this Court was a given. Initially, I was not so convinced. However, in the circumstances, I am satisfied that this Court does have the jurisdiction to determine the matter. The Building Act 1975 is an enabling Act which, pursuant to s 71(2), imposes a positive obligation to take a particular action. There has been non-compliance with that obligation.
- The applicant is an experienced property developer. On 25 November 2020, it entered into a contract to purchase land from a Mr Russell Madgwick. That land is located at 509 Main Road, Wellington Point and is more properly described as Lot 1 on RP815402, Lot 2 on RP107272 and Lot 126 on RP14151. It was the applicant’s intention to develop the land in a manner consistent with its Medium Density Residential zoning. The original purchase price to be paid for the land was $1,250,000. That amount was to be paid by way of a $5,000 deposit, the payment of $1,045,000 on settlement date and a further payment of $200,000 12 months after settlement. The contract contained a number of conditions in Annexures B and C. Annexure C to the contract provided:
“1. This contract is subject to and conditional upon the sellers at their own expense employ a demolishing company to demolish the existing house and shed on the property and having the said house and shed removed from the property leaving a clear block of land prior to settlement.
If the sellers do not have the aforementioned house and shed demolished and cleared prior to settlement, then the buyers may elect to terminate this contract in writing and all deposit monies shall be refunded in full to the buyer.”
- At that time, Mr Madgwick had the benefit of the subject building approval for the demolition of the house and shed on the land which was issued on 17 November 2021 (the development approval). In accordance with a deed dated 17 December 2020, the contract was varied to reduce the contract price from $1,045,000 to $1,000,000 and the final payment was increased from $200,000 to $250,000. In all other respects, the terms, governance and conditions of the contract remained unchanged. However, of particular significance is that on 29 January 2021, a further deed was entered into whereby the purchase price was reduced yet again to $900,000 and, of particular significance in the context of this case, the special condition which placed the obligation on the seller to demolish and remove the structures was deleted. That is, pursuant to that deed, from 29 January 2021, the obligation to demolish and remove the structures fell on the applicant.
- Mr Karam, on behalf of the applicant, gave evidence that with hindsight, the benefit of saving $100,000 on the purchase price was greatly overshadowed by the cost of absorbing the commercial risk of demolition and removal.
- I do not find that evidence to be particularly surprising in light of the fact that on 13 January 2021, a stop order was issued by the Acting Minister for the Environment and the Great Barrier Reef which relevantly provided:
“… under the powers vested in me by s 154 of the Act, (I) hereby require Mr Russell Collin Madgwick, the owner to stop the stated work or activity and I prohibit Mr Russel Collin Madgwick from starting the stated work or activity.
For a period of 60 business days commencing today.”
- Somewhat curiously, the stop order affected all three parcels of land, notwithstanding the fact that the structures were all located on the one lot. Consequently, the order prohibited not only the demolition of the dwelling on the land, but also the shed. The order was issued on grounds including that the “place” was likely to satisfy one or more of the cultural heritage criteria for entry in the Queensland Heritage Register. It is uncontroversial that the shed on the land could in no way satisfy any of the criteria for entry in the Queensland Heritage Register. More will be said about the stop order and how it came into being below.
The structures on the land
- In the report prepared by Eiger Structural Engineers, the dwelling was described in the following terms:
“The dwelling is an old Queenslander which has a central 7 x 9m core housing living area and a 2400mm wide verandas that wrap around this central core. The veranda has been enclosed in some areas to create a bathroom/kitchen/laundry and separate room. The age of the dwelling is unknown.”
- In that same report, it was said that the current condition of the house was “extremely poor.” Visual images of the house are shown in various reports and other documents. As has already been pointed out, it is uncontroversial that the shed located on the land is of no cultural significance whatsoever.
- In the report of Napier Blakeley prepared on behalf of the applicant, the condition of the house was described in the following terms:
“On inspection it was noted that the existing condition of the property was poor with evidence of structural damage to building stumps and associated floor bearers with wood decay, damage to external cladding and exposed timber framing. There was apparent water damage or structural warping to the floor structure when walking over areas throughout the property and evidence of roof leaks through staining and damage to the ceilings internally. Various windows and external doors appeared to be twisted or warped and unable to open or close. The external veranda flooring was warped and the external timber steps appeared very fragile under foot.
The property was in very poor decorative state, both internally and especially externally with considerable areas of worn or damaged paint surfaces with poor quality timber substrate resulting from weather damage or possible termite damage.
I was not able to inspect the roof however my understanding from the reports provided is that the roof sheeting is in poor condition along with missing or damaged rainwater goods.
The property also has evidence of previous occupation and there was considerable debris throughout the property.
The consequence of the above noted damage is the need for significant structural timber repairs to floors, walls, ceilings and the roof together with consequential replacement of cladding or sheeting and associated finishes to the same areas as well as removal and replacement of fixtures and fittings to the kitchen, bathroom and laundry.”
- A report was also prepared by a Mr Rode-Bramanis, being the structural engineer retained by the applicant. In his affidavit, Mr Rode-Bramanis identified a number of items that required consideration to ensure that the building was made structurally sound and that structural integrity was maintained. His summary of those matters are as follows:
“The house, as it currently stands is in an extreme state of disrepair. The damaged roofing and guttering has allowed water to run freely down the sides of the dwelling and cause significant water damage to the external claddings, bearers and joists in these areas. Termites have eaten out the flooring in several locations, and the foundation movements have caused flooring levels to differ by up to 70mm. There is also a significant health and safety issue for the occupants. With mould in the kitchen/bathrooms, and termite eaten and rotten floors and bearers, the dwelling is not ideal as a habitable space.
The structural members in the house (bearers, joists, walls and roof framing), for the most part appear to be in good condition. They could form the basis of a re-build, but they are not compliant to current building codes and standards which may present their own issues. The connections and tie down would also need a careful look, as existing fixings may have degraded or rusted away with time. The cost to try to make the dwelling good and habitable would be significant.” (emphasis added)
- The extent of the termite damage was addressed by a Mr Tolhopf and is set out in his report, but it is unnecessary to go into any more detail than already identified.
- The structural integrity of the house was also investigated by Mr Bugeja, a structural engineer retained on behalf of the respondent. Under the heading “Repair summary,” he identified the following matters:
“Below is a summary of the structural repairs required, based on the above assessment:
- The house will need to be completely re-stumped and re-levelled;
- 15% of the floor boards;
- External bearers in multiple locations;
- 5% of the roof structure;
- Particle board floor in kitchen, bathroom and laundry;
- Corrugated iron roof sheeting (repair or replace).”
- Under the heading “Conclusion,” it was reported:
“We agree with the statements made in the IGA report that ‘structural members in the house (bearers, joists, walls and roof-framing), for the most part appear to be in good condition.’ From a structural point of view the building is salvable.
We would recommend that a budget estimate be obtained to understand the cost associated with bringing the building back to a habitable condition.”…(Original emphasis).
- While it may be accepted that there was a degree of debate between the two structural engineers as to just how structurally sound the house might be, it is unnecessary to resolve that debate because both structural engineers accept that the structural members of the house are in relatively good condition. It can also be accepted that from a structural point of view, the building is salvageable. That of course, is not the end of the matter, as it is necessary to consider the evidence going to costs.
- In the written submissions filed on behalf of the respondent, it is asserted:
“The level of cost can only be truly assessed in light of the valuation of the land and the prospective value if the land is developed while the house remains intact. The block is a large one. There is space for a development around the house, potentially for units or townhouses. The applicant has called no evidence about the current or future value of the block, or Karam’s intentions for the land, to allow any firm conclusion about the reasonableness of the cost of making the house habitable in that context. However, what can be garnered is that the cost is likely to be minor compared to the likely value of the block. A contract of sale for the block was for $1.25m. One would expect the value would be considerably more if townhouses or units were built on the clear paths of the land. The cost of $100,000.000 or $150,000.00 for structural repairs, or even $310,000.00 to make the house habitable is very little in the context of the development of this land.”
- The estimate of $310,000.00 to make the house habitable is derived from the Napier Blakely Report referred to above. As to the cost of $100,000.00 or $150,000.00 to make the house structurally sound and to maintain that soundness, it would seem from the evidence of Mr Bugeja that those costs would be in the order of $125,000.00 (excluding preliminaries and GST).
- In my respectful opinion, that submission made on behalf of the respondent is unpersuasive. In the circumstances of this case, it would be reasonable to infer that in the hands of the applicant, the land currently occupied by the house would be more valuable to it as land capable of being developed for units or townhouses. Further, in the event that the house was to remain on the site, it is unlikely that it could be left in only a structurally sound condition. That is, it would not be unreasonable to draw the further inference that it is more likely than not that the applicant would have to bring the house up to a habitable condition at a cost of in the order of $310,000.00. Otherwise, the house would remain a blight impacting on any development that might take place on the balance of the land, including that currently occupied by the shed.
- In any event, to accept that submission would invite speculation. There is simply no evidence one way or the other to determine just what the economic impact for the applicant might be if required to carry out any development incorporating the house.
- The parties identified the issues requiring consideration as follows:
“AGREED LIST OF ISSUES
Whether the non-compliance with s 71(2) of the Building Act 1975 (Qld), to substantially start the demolition of the house at 509 Main Road, Wellington Point within 2 months of the development permit, should be excused in an exercise of the Court’s discretion, by reference to the following considerations:
- Whether, and if so to what extent, the Stop Order issued by the Minister for the Environment and the Great Barrier Reef:
a. caused the non-compliance with the substantial start provision; and/or
b. precluded the exercise of rights under the subject demolition approval.
- The extent to which the Applicant will be prejudiced if the non-compliance is not excused, in the ways set out in paragraph 36 of the Originating Application.
- Whether there is a reasonable argument that the subject house is structurally sound or reasonably capable of being made structurally sound.
- Whether the state of the subject house and the cost to maintain and/or to use of the subject property militates in favour of the grant of the requested relief.
- Whether the grant of the relief will achieve the purpose of the Planning Act, particularly:
a. the establishment of an effective, transparent and accountable system for achieving ecological sustainability, including economic development and economic wellbeing of people through, inter alia, planning schemes and the development assessment system establishing rights and responsibilities in respect of development approvals (s 3 and s 4); and
b. ethical decision-making processes (s 5).
- Whether the public interest in the protection of the land and subject house on heritage grounds militates against excusal of the non-non-compliance, including by reference to:
a. the public notification of a proposed change in heritage protection of the land and house before the development permit for demolition was applied for.
b. the change in heritage protection of the land and house between the date of the development permit and the date of hearing under Temporary Local Planning Instrument No 1 of 2011.
c. the proposal to change the planning scheme by proposed Major Amendment to the Redland City Plan 2018.
d. the purposes of the Planning Act, particularly in relation to community involvement in decision making and the conservation of heritage places (ss 3(3)(c)(ii), 5(2)(b), (e) and (i) Planning Act).
- Whether it is in the public interest that the Respondent consider a further development application to demolish the house under Temporary Local Planning Instrument No 1 of 2021 and Redland City Plan 2018 (as at the time of the application) rather than the Court excuse the non-compliance.
- Whether it is in the public interest that an individual with the benefit of a development approval have the opportunity to fully exercise rights afforded by any such development approval.
- Whether any conduct of the Applicant or its director or the previous owner of the land militates against the exercise of discretion under the applicant’s favour.
- Whether the circumstances surrounding the Respondent’s referral of the subject house to the Minister for Environment and the Great Barrier Reef, with associated request to consider the issue of a Stop Order, militate in favour of the grant of the requested relief.”
- It is convenient at this stage to provide a timeline to identify the circumstances under which the lapsing of the building development approval came about.
- The subject house has been located at its current site since some time around 1886. In 2016, the respondent engaged consultants to identify buildings within its local government area which had “European heritage value”. The subject house was identified as one of a number of buildings having local heritage significance, apparently on the basis that at one time, it had housed the manager of the local sawmill being one George Burnett.
- On 23 January 2019, the respondent resolved to introduce a major amendment to its planning scheme to include a number of sites, including the subject, in the Heritage overlay of its planning scheme. On 7 October 2020, the respondent resolved to release the proposed amendment together with a list of all the properties proposed to be included within the Heritage overlay for public consultation. That took place between 12 October and 4 December 2020. It is uncontroversial that the owner of the property at the time, Mr Madgwick, was notified of the public consultation on 8 and 13 October 2020. In all likelihood, to avoid the ramifications of the heritage listing, Mr Madgwick engaged a building certifier to assess the property and grant a building approval for demolition. That procedure was permitted under the respondent’s planning scheme as it then was. The building certifier approved the demolition by notice issued on 17 November 2021.
- The applicant entered into the contract to purchase the land on 26 November 2020. The applicant was obviously aware of the building development approval and, as identified above, the contract as it initially stood placed the obligation on Mr Madgwick to demolish and remove the structures on the land.
- On 6 January 2021, Mr Madgwick contacted a Mr Knijff of Thor Demolition Pty Ltd about demolishing the buildings on the land. After carrying out an inspection, Mr Knijff gave a quote for the demolition works which was accepted by Mr Madgwick on or about 13 January 2021.
- The evidence of Mr Knijff, which I accept, is that by 13 January 2021, Thor Demolition had carried out a number of preliminary steps intended to allow the physical site preparation works to be commenced by 15 January 2021. According to Mr Knijff, his company did not work on weekends which would mean that the physical demolition of the house would not have commenced until 18 January 2021. However, once commenced, all of the structures on the land would have been demolished and removed within three days. The site preparation works which were to occur on 14 or 15 January included the removal of all glass, gyprock, doors and all salvageable items “and pieces of the building that need to be segregated for the purpose of recycling and waste”.
- While a number of hypothetical scenarios (e.g. weather and illness etc) were put to Mr Knijff to suggest that the demolition might not have gone according to schedule, I am satisfied that the works would have been carried out within the timeframe contemplated by Mr Knijff.
- However, in the meantime on 11 January 2021, the respondent became aware of the building approval authorising the demolition of the house. The Mayor wrote to the Acting Minister for the Environment and the Great Barrier Reef, asking the State to “urgently consider the heritage value of this property and the appropriateness of issuing a Stop Work Order and a full assessment for potential on the State Heritage Register.” Two days later on 13 January 2021, the Acting Minister issued the stop order. More will be said regarding that exchange of correspondence below.
- Notwithstanding their knowledge of the stop order, the applicant and Mr Madgwick had executed the second deed which relevantly reduced the purchase price by $100,000.00 and passed the obligation and the risks associated with the demolition works from Mr Madgwick to the applicant. The contract settled on 3 February 2021.
- On 17 March 2021, the respondent resolved to implement a Temporary Local Planning Instrument (TLPI) intended to protect the subject house and have it placed in the Heritage overlay of its planning scheme. The TLPI was approved by the Minister on 25 March 2021, and the applicant was advised of this on 26 March 2021.
- Notwithstanding the State’s apparent enthusiasm to protect this property, it was finally resolved that it was not so significant to warrant being entered onto the Queensland Heritage Register.
- On 18 August 2021, being the last sitting day of this proceeding, the TLPI was on the agenda for a meeting of the Council. On that day, the court was advised that this issue or matter had been adjourned for reasons that were not explained. As a consequence, while the stop order has now lapsed, the house remains the subject of the TLPI.
Consideration and discussion
- The respondent contends that the relief sought ought be refused because:
“The Redland City Council (the Council) submits that the Court would not grant the relief sought as:
- (a)The town planning regime applicable to the land has changed in a significant way since the development approval was issued and so it is appropriate that a fresh development application be considered by the Council as assessment manager;
- (b)There is substantial public interest in protecting the house given its local heritage value;
- (c)The loss of rights was not wholly outside the control of the applicant and the previous owner of land, who delayed before acting on the approval;
- (d)The house is structurally sound;
- (e)The conduct of the applicant, its sole director Mr Karam and the previous owner militate against the court exercising a discretion in the applicant’s favour by not fulling informing (sic) the court, delaying in arranging the demolition and voluntarily taking on the risk of heritage protection of the house.”
- By virtue of the operation of s 38(1) of the Acts Interpretation Act 1954, the “substantially started” condition of the building development approval would have lapsed on 18 January 2021. By that time, I am satisfied that but for the stop order, it is more likely than not that the demolition works would have substantially started. The evidence of Mr Knijff, which I accept, is that within three days “maximum” the house would have been demolished and all of the rubble would have been removed.
- An entirely unwarranted consequence of the stop order is that it even prevented the applicant from demolishing the shed on the subject land. While there is no direct evidence on the point, even if Mr Knijff’s evidence was limited solely to the demolition of the house, it would be reasonable to infer that at the very least, all the preliminary works including site preparation works would have been completed and the shed would have been demolished by the close of business on 18 January 2021. In this regard, Mr Knijff’s evidence was that it would take a machine only a couple of hours to demolish the house, with the next two to three days being utilised for the removal of waste and rubble, including the removal of footings.
- That is, the stop order impermissibly prevented those works being carried out. Putting aside the TLPI for the moment, in my view, had those works been allowed to occur, the applicant would have had at the very least a strongly arguable case that the demolition works had been substantially started, notwithstanding the house being left standing.
- Turning then to the five reasons for refusing the relief sought advanced on behalf of the respondent, but not in the same order.
- It can be readily accepted that there is a public interest in protecting places with sufficient heritage value to warrant protection. That said, the heritage value of the house in its current state must be highly questionable.
- There was no evidence that the applicant had any intention of spending money to ensure the structural integrity of the house, let alone returning it to a habitable condition. Further, in this regard, I was not taken to any material that would permit me to have any confidence that the house would be restored either by compulsion or with the financial assistance of the respondent.
- As Ms Hedge accepted, there is no obligation on the applicant to carry out any works on the house. The evidence given by Mr Karam certainly did not give the impression that the applicant had any intention of carrying out any improvement to this house, let alone incorporating it into any development.
- The submission that the house is structurally sound overlaps, to an extent, with the submission I have just dealt with. The evidence of the structural engineers has to be treated with some caution. As identified above, while opining that the structural members of the house appeared to be in good condition, Mr Rode-Bramanis also stated in his report that it was however, “in an extreme state of disrepair”. Mr Bugeja on behalf of the respondent agreed that structurally, the house appeared to be in good condition and then went on to say, “from a structural point of view the building is salvable.”
- The cross-examination of the structural engineers is also revealing. When being asked about the part of his report stating that the current condition of the house was extremely poor, Mr Rode-Bramanis responded to two questions by saying “it hasn’t fallen down,” and “if left as it is, it will eventually”. Mr Bugeja’s evidence was to a similar effect. Namely, while structurally sound, some structural work is required at present and even further work is required to maintain that structural soundness.
- For the reasons given, in the overall scheme of things, I do not consider the fact that the house may be described as being structurally sound at present to be a particularly decisive consideration.
- In the circumstances of this case, I consider the observation of this court in Farrah v Brisbane City Council to be apt:
“Before going on to consider the evidence I would also make the observation that obligations of the type involved here imposed on landowners have the potential to result in material financial disadvantage in the absence of compensation being payable. That is, limitations on the ability to deal freely with one’s land may well result in an owner being denied the opportunity to maximise his selling price by selling the land in a state capable of achieving its highest and best use. In circumstances where, by way of examples, an owner could not afford to carry out the works or simply refused to expend the necessary money, the end result may be that structures are simply being left to deteriorate further. Such an outcome would neither benefit the owner, the respondent, nor the broader community of Brisbane. In respect of the former example Mr Williamson said that the owner could simply sell the property. That may well be so but for whatever reason he may not want to.”
- Turning then to the submission that the loss of the ability to demolish the house was not wholly outside the control of the applicant, nor the previous owner of the land because of the delay in acting on the building development approval. There is certainly an element of truth in that submission. Had Mr Madgwick acted promptly once the quote for the demolition had been accepted, this proceeding would be unnecessary.
- That said though, the delay has to be seen in context. On the day the demolition was accepted, being 13 January 2021, there were still three business days over which demolition works could have occurred. In this regard, it must be kept in mind that to satisfy the building development approval only required that demolition must have substantially started within two months of the giving of the approval. As already identified, the evidence of Mr Knijff was that within three days at the latest, the physical demolition would have been completed and the whole of the site cleared of any debris. In those circumstances, while it could be accepted that by not acting promptly, Mr Madgwick had placed the applicant in the position it is in, I am satisfied that, but for the stop order, it is more likely than not that demolition works would have been substantially started within two months. Accordingly, I do not consider this point to be particularly persuasive.
- Turning then to the submission made concerning other conduct on the part of the applicant. It was submitted on behalf of the respondent that one of the factors that would militate against granting the relief sought was that the applicant had failed to mitigate “its loss or damage or protect the local heritage place while its fate was uncertain.” I do not consider this submission has any force for at least two reasons. First, as Ms Hedge accepted, the applicant was under no obligation to carry out any works to protect the structural integrity of the house. Second, while of course the onus is upon the applicant to satisfy me that the relief sought ought be granted, the court is entitled to expect at least some evidence on a party who alleges a failure to mitigate. Here, there is no evidence one way or the other which would permit me to reasonably draw an inference that from 13 January 2021 through to the hearing date of this application, there has been any material deterioration in the structural integrity of the house.
- As to the applicant’s failure to be frank with the court, that is expanded upon in paragraph 72 of the respondent’s written submissions. One of the matters identified is the failure of Mr Karam to divulge any information about the deeds of variation to the contract. That was an unfortunate omission and did not reflect particularly well on him. As to the other matters pointed to, including errors in his affidavit and other apparently contradictory evidence, they did not leave me with the impression that he was reckless as to the truth. Nothing about Mr Karam’s credit and/or reliability of itself, in my view, militates in any material way against the granting of the relief sought.
- The next matter raised in this submission is that, by virtue of the execution of the deeds of variation, the applicant had voluntarily taken on all of those risks associated with having the demolition works completed. As has already been identified, the applicant took on this risk after the stop order had been issued. The applicant also took on this risk with the full knowledge that the respondent had every intention to take steps to protect the house from demolition. That was clearly a commercial decision made by the applicant, the consideration for absorbing all those risks being a reduction in contract price of $100,000.
- Accordingly, there is force in the submission made on behalf of the respondent that in all the relevant circumstances, that commercial decision on the part of the applicant operates strongly against the granting of the relief sought. In this regard, I do not accept the submissions made on behalf of the applicant that its commercial conduct was a matter of irrelevance. However, that the applicant took that risk ought not meant it must forfeit its right to otherwise use its land for a lawful purpose.
“There have been significant changes to the assessment of an application for demolition of the house since the approval was granted. The Council … submits that this change means that the public interest favours a fresh development application being made for the Council to consider rather than the court excusing non-compliance and allowing the lapsed approval to be acted upon”.
- As at November 2020, demolition approval was code assessable and was able to be granted by a building certifier under the Building Act, as was the case here. Under the TLPI which came into effect from 17 March 2021, the subject land has been added to Schedule 7 of the respondent’s planning scheme and falls within the respondent’s Local Heritage Register and the Heritage overlay. The net result is that the demolition of the house is now impact assessable and has a number of potential consequences. These include the requirement for a new development application necessitating public notification and submissions, and that the assessment manager might have regard to relevant assessment benchmarks in assessing the application. As Ms Hedge pointed out, addressing those benchmarks could be an expensive experience involving the input of experts in various fields.
- It is now well accepted that, prima facie, a planning scheme embodies the public interest. The introduction of the TLPI represents a substantial change to the respondent’s planning scheme designed to protect places with sufficient local heritage values. Accordingly, it can be accepted that the introduction of that temporary planning instrument is reflective of the public interest in protecting places with such heritage value. In advancing the respondent’s case in this regard, reliance was placed on three previous judgments of this Court, being Sevmere Pty Ltd v Cairns Regional Council, Annandale v Cairns Regional Council and, in particular, observations by her Honour Judge Kefford in Brassgrove KB Pty Ltd v Brisbane City Council. It was submitted on behalf of the applicant that the current situation can be readily distinguished from the relevant facts, matters and circumstances involved in each of those three decisions. I agree with that submission.
- In Sevmere, it was expressly found that the explanation given for the failure to act on the approvals within the prescribed timeframe was not persuasive “in terms of a favourable exercise of the discretion to extend”. That is not the case here. Notwithstanding the lateness of any commencement of the demolition works, the applicant could have been substantially started prior to the expiration of the two months, but for the stop order. In respect of both Annandale and Brassgrove, they were concerned with situations where the relevant approvals had lapsed. Again, that is not the case confronting the applicant. As has already been identified, pursuant to s 71 of the Building Act, the building work must have substantially started within two months of the giving of the approval and be completed within one year after the giving of the approval. Pursuant to s 91(2) of the Building Act:
“The building development approval lapses if the demolition/removal completion condition has not been complied with by the end of the period under the demolition/removal completion condition.”
- Pursuant to s 71(4), the “completion condition” is the one year period prescribed pursuant to s 71(3). Accordingly, the subject approval does not lapse until 18 November of this year.
- While a person might apply for an extension of up to six months for the one year completion date pursuant to s 71(5) of the Building Act, the respondent does not appear to have the power to extend the substantially started obligation. Any relief in respect of that obligation can only be pursued in this court.
- In paragraph 35 of the respondent’s written submission, the following passage is taken from her Honour’s reasons in Brassgrove:
“Where there is a change to the planning regime that relates to a fundamental aspect of the development the subject of a lapsed approval, that is an important factor that should bear upon the approach the Court should take. It is indicative of a town planning imperative for the development to be the subject of a fresh assessment and decision under the Planning Act 2016.
The public interest in permitting an assessment manager to undertake the original merits assessment of a development where there have been fundamental changes to the planning regime is apparent from the legislation that provides that the development process in Queensland, the Planning Act 2016. The purpose of the Planning Act 2016 is to establish, amongst other things, an efficient, if effective, transparent and accountable system of development assessment …” (emphasis added)
- Here, the building development approval granted under the law as it then stood, is still current. As the originating application itself makes clear, what the applicant is seeking is relief in respect of the failure to comply with the substantially started condition of that approval. In my view, that is a vastly different situation than that confronting the court in either Brassgrove or Annandale.
- To rely on those passages of her Honour’s reasons, as the respondent does, with respect, misses the point. In this case, unlike that in Brassgrove, the fundamental changes to the planning scheme relied on will take no part in the assessment of the merits of the development application. As has already been pointed out, those merits have been assessed and determined under the planning scheme as it then stood.
- For the reasons expressed, I do not consider that, with all due respect, any of those cases relied on by the respondent provide any real assistance in determining how the court ought exercise its discretion in the circumstances of this proceeding.
- On behalf of the respondent it was further submitted that:
“The key point made by the applicant appears to be that it was no fault of theirs that the demolition approval lapsed; they were prevented by a Stop Order which did not result in a State heritage listing. Even if it is accepted (which is not admitted) that the substantial start provision would have been complied with absent the Stop Order, the Council submits that the public interest in the Council considering a fresh application because of the change in the local planning scheme since the original approval, and the protection of local heritage places, justify the minor amount of development rights lost by the applicant.” (emphasis added).
- For the reasons already given, I am sufficiently satisfied that but for the stop order, the substantially completed requirement of s 71(2) of the Building Act could have been complied with. Also, for the reasons given, I have grave reservations about the public interest being served by protecting this house in its present condition where there is no obligation on the part of the applicant to carry out any rectification works nor any intention on the part of the respondent to offer any meaningful financial assistance in that regard. As to the assertion that to prevent the demolition of this house would result in only some minor loss of development rights, I am unaware of any evidence that would warrant such a conclusion being drawn.
- There can be little doubt that to retain this house on the site, even allowing for the demolition of the shed, would have a material impact on the amount of land available for development. That there would still be the opportunity to carry out some form of townhouse or unit development on the balance of the land is not really to the point. It would also not be unreasonable to infer that any development of the balanced land would require at least some works to be carried out on the house. Otherwise, it would be a blight on any surrounding development. As has already been discussed that would impose an unwanted and not insignificant financial burden on the applicant.
- Finally, in paragraphs 55 and 56 of the respondent’s submissions, under the heading “The claimed impact of the Stop Order” it is said:
“In any case the Council submits that the issue of the Stop Work Order [sic] was entirely appropriate in the public interest. If it caused any non-compliance or precluded compliance, that result is a lawful one. There are criteria for the entry of State heritage places on the Queensland Heritage Register in s 35 of the Act. A Stop Order may be issued if the Minister considers on reasonable grounds that the place is likely to fulfil one or more of the criteria and work that may occur will destroy or substantially reduce the cultural heritage significance of the place.
There is no suggestion in this case that the Minister acted otherwise than in good faith in considering that the land was likely to fulfil one or more criteria in issuing the Stop Order. There has been no legal challenged to Stop Order and its appropriateness should not be the subject of a collateral attack in these proceedings. That the property was not ultimately entered into the Queensland Heritage Register makes no odds. The Queensland Heritage Council in deciding whether to enter a property into the Register applies a different test than the Minister in deciding to issue a Stop Order.” (footnotes omitted – original emphasis)
- There can be little room for doubt that a stop order may be issued by the appropriate Minister when acting on reasonable grounds. The current situation however, requires consideration of just how the stop order came about.
- As has already been identified, the order impermissibly covered the whole of the land owned by the applicant and, by necessary implication, prevented the demolition of the shed on that lot occupied by the house when that structure had no heritage value.
- There are a number of concerning aspects in respect of the exchange of correspondence between the Mayor and the Acting Minister for the Environment and the Great Barrier Reef. The correspondence by the Mayor on 11 January 2021, refers to the recent engagement of a heritage consultant retained to identify and document local heritage values across the city. As far as I am aware, the only investigation carried out by a consultant to assess local heritage places was that completed in 2016. That could hardly constitute the recent engagement of a consultant. On any reasonable reading, this correspondence was a plea for the intervention of the State. It concludes in the following terms: 
“At this stage of the amendment process Council does not have the authority to prevent the demolition or removal of dwelling.
I would ask the State to urgently consider the heritage value of this property and the appropriateness of issuing a ‘Stop Work Order’ and a full assessment for potential listing on the State Heritage Register.”
- The matter was indeed treated urgently by the Acting Minister. Only two days later, on 13 January 2021, the Acting Minister responded in the following terms:
“After considering your request, I have decided to make a Stop Order to the owner(s) of 509 Main Road. My reason for making the Stop Order are that I consider the place is likely to meet one or more of the cultural heritage under s 35(1) of the Act, and the Stop Order will prevent work or activity to the place which would destroy or substantially reduce cultural heritage significance.
The Stop Order prevents work which could be detrimental to the place for a maximum period allowed by the Act which is 60 business days. … And I invite you to supply all relevant information on the place to inform the independent Queensland Heritage Councils assessment.” (emphasis added).
- A number of observations can be made about this correspondence. First, it would appear that the correspondence from the Mayor did not include the report prepared by the heritage consultant, nor any other material. It is otherwise unclear why the Acting Minister would issue the invitation for the Mayor to supply all relevant information that might assist in the Heritage Council’s assessment of the house. Further, in the absence of any supporting material, which seems to be very much the situation here, I fail to see how the Acting Minister could have reached the conclusion that this house was likely to meet one or more of the cultural heritage criteria prescribed under s 35(1) of the Queensland Heritage Act 1992. That conclusion is reinforced to at least some extent by the fact that the house was not considered to be of such significance as to warrant it being placed on the State’s Register.
- On balance, I have reached the conclusion that when the decision was made to issue the stop order, the Acting Minister did not have sufficient, if any, material before her to make a properly considered decision. Otherwise, why would the order extend over the whole of the site (Lots 1, 2 and 126) and include the shed? It would not be unreasonable to infer in that regard, that the Acting Minister was acting on the street address provided by the Mayor rather than on reliable information and/or advice about where the house was actually situated.
- Any authoritative body with the power to impose material restrictions on how a landowner may exercise their rights in respect of the use of that land, particularly in the absence of just compensation or the right to be heard before the order is issued, ought be expected to exercise an appropriate level of due diligence before making the decision to issue that order. That was not the case here.
- As well intentioned as the decision to issue the order was, it without any justification denied the applicant the right to demolish or at least start to demolish the shed. For that reason, contrary to the submission made on behalf of the respondent, I do not consider that the stop order was issued on “reasonable grounds”.
- For the reasons given, I am satisfied that the non-compliance with the requirement to substantially start the demolition work within two months of the approval date ought be excused pursuant to s 37 of the PECA. Accordingly, the orders of the Court will be:
- The non-compliance with s 71(2) of the Building Act 1975 arising from the failure to substantially start demolition work within two months of the granting of the demolition approval on 17 November 2020, is excused.
- I will hear from the parties as to further consequential orders.
Exhibit 1 at p 26.
Exhibit 1 at p 147.
Exhibit 1A at p 43.
For example, see Exhibit 1A at pp 53 – 55.
Exhibit 1A at pp 14 – 15.
Exhibit 1A at p 52.
See Exhibit 1A at pp 93 – 124 for Mr Tolhopf’s report.
Exhibit 2 at p 215.
Written Submissions of Respondent at para 51.
Exhibit 1A at p 4, paras 8 – 9.
T2-52 at lines 5 – 23.
Written Submissions of Respondent at para 2.
T2-53 at lines 32 – 37.
Written Submissions of Respondent at para 2(b).
Written Submissions of Respondent at para 2(d).
T2-26 at lines 25 – 36.
T2-39 at line 38 – 43.
 QPELR 449 at .
Written Submissions of Respondent at para 2(c).
Ibid para 2(e).
Written Submissions of Respondent at para 74.
NOTE: In fact, the discount may only have been $95,000, but nothing turns on the difference.
Written Submissions of Respondent at para 2(a).
Ibid at para 27.
Ibid at para 32.
 QPEC 32 at  – .
(2020) QPELR 438.
 QPELR 119.
At  – .
Written Submissions of Respondent at para 3.
Exhibit 2 at p 133.
Ibid at 134.
NOTE: In circumstances where most of the subject site is vacant.
- Published Case Name:
Karam Boutique Residential 8 Pty Ltd v Redland City Council
- Shortened Case Name:
Karam Boutique Residential 8 Pty Ltd v Redland City Council
 QPEC 47
RS Jones DCJ
14 Sep 2021