On 24 October 2016, the Western Australian Supreme Court of Appeal (Court of Appeal) delivered its decision in Reid v Western Australian Planning Commission [2016] WASCA 181. The Court of Appeal, in granting the appellants leave to appeal, set aside the decision of both the judge at first instance of the Supreme Court and the State Administrative Tribunal (SAT), remitting the matter to the SAT for determination.
The appellants were the registered proprietors of land and applied to the respondent, the Western Australian Planning Commission (WAPC), for approval to subdivide the property into two lots. The WAPC granted subdivision approval subject to five conditions which, amongst other things, would require the appellants to:
The SAT dismissed the appellants’ application to review the conditions imposed by the WAPC. In determining whether the conditions could be reviewed, the SAT reaffirmed the requirement, as outlined by McHugh J in Western Australian Planning Commission v Temwood Holdings Pty Ltd (Temwood),[1] that the conditions be ‘reasonably and fairly’ related to the development.[2] The SAT concluded that there was the relevant nexus between the development and the conditions as the latter pursued a legitimate planning purpose, namely, environmental regulation, which was necessarily related to the subdivision.[3]
The appellants’ application for leave to appeal from the SAT’s decision was also dismissed by the judge at first instance. In dismissing the application, Chaney J held that the SAT did not make an error of law as he agreed with the SAT’s conclusion that there was a nexus between the proposed subdivision and the conditions imposed by the WAPC. Further, Chaney J concluded that the required nexus can exist because of a relationship between the development and the pursuit of broad ‘societal aims’ which can be expressed through planning instruments.[4]
The Court of Appeal held that the previous findings of the Court and the SAT constituted errors of law and should therefore be set aside.
The Court confirmed that the test for determining the validity of a condition imposed on the approval of a subdivision is the ‘Newbury Test’, which was originally adopted in Newbury District Council v Secretary of State for the Environment,[5] and subsequently affirmed by the High Court in Temwood.[6] The ‘Newbury Test’ comprises of three separate
limbs and requires that:
The Court clarified that the second limb requires an establishment of a direct connection between the planning purpose for which the condition was imposed and the likely or possible consequences of the proposed subdivision.[7] This connection must be established as a matter of fact and will not be established simply because the application for subdivision approval represents an opportunity to impose a condition in the pursuit of a proper planning purpose.
In applying the Newbury Test to this case, the Court of Appeal concluded that the SAT and the judge at first instance incorrectly applied the second limb of the test in their review of the conditions imposed by the WAPC, and therefore had made an error of law. This is because they did not provide any findings of fact as to the likely or possible consequences of the proposed subdivision which would have a fair and reasonable connection with the planning purpose to be achieved by imposing the conditions, namely, ensuring environmental protection.[8]
The Court further held that it was erroneous for the SAT to conclude that it was unnecessary to identify any factual connection between the consequences of the proposed subdivision and the planning purpose facilitated by the condition because the condition served a broader ‘societal’ aim. This is because, as Martin CJ stated, the test ‘…requires more than that the condition be imposed in the furtherance of a proper planning purpose…the condition and the purpose which it serves must reasonably and fairly relate to the particular development proposed.’[9]
The Court of Appeal’s decision not only clarifies the second limb of the Newbury Test, but also provides direction as to when subdivision approval conditions will be valid. The Court confirmed the WAPC’s broad power to impose conditions under the Planning and Development Act 2005 (WA), however, the Court clarified that this power must be exercised in accordance with all three limbs of the Newbury Test. Specifically, the second limb of the test will only be satisfied if there is a direct connection between the planning purpose for which the condition was imposed and the likely or possible consequences of the proposed subdivision.
Importantly, it is insufficient to justify a condition based on the fact that it furthers a planning purpose of a broader societal aim without establishing how the condition directly relates to the proposed subdivision.
If you have any questions on this decision or regarding subdivision development approval in general, please contact Craig Wallace on (08) 9288 6828.
[1] (2004) 221 CLR 30.
[2] Reid v Western Australian Planning Commission [2015] WASAT 35, [27]-[30].
[3] Ibid [37]-[42].
[4] Reid v Western Australian Planning Commission [2015] WASC 293, [18]-[23].
[5] [1981] AC 578.
[6] Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30, [57] (McHugh J).
[7] Reid v Western Australian Planning Commission [2016] WASCA 181, [37] (Martin CJ).
[8] Ibid [36]-[45] (Martin CJ).
[9] Ibid [40] (Martin CJ).
