Land and Environment Court New South Wales

• Medium Neutral Citation: Barrak Corporation Pty Ltd v Parramatta City Council [2014] NSWLEC 177
• Hearing dates: 23 October 2014
• Decision date: 18 November 2014
• Jurisdiction: Class 3
• Before: Biscoe J

Decision

Appeal dismissed with costs.

• Catchwords: RATES - categorisation of rateable land - appeal limited to questions of law under s 56A Land and Environment Court Act 1979 to a judge from a decision of a commissioner of the Court in a Class 3 rating matter - under s 529(2)(d) Local Government Act 1993 a council may determine a sub-category for business rateable land according to a centre of activity - owner of rateable land appealed to Court from decision of Council to refuse application under s 525(1)(b) to change the rating sub-category of the land from Business CBD to Business General to which far lower ad valorem rates applied - Court constituted by a commissioner dismissed appeal - under s 525(3) Council obliged to determine property was within the Business General sub-category nominated in application unless it has reasonable grounds for believing that the land is not within that category - under s 39(2) Land and Environment Court Act, on appeal from Council decision Court is under the same obligation - Council and Court (constituted by a commissioner) each decided had reasonable grounds for believing land not within Business General sub-category, but within Business CBD sub-category - meaning of "centre of activity" in s 529(2)(d) Local Government Act - whether Commissioner erred in law in failing to apply the correct test under s 525(3) because she asked the converse question - whether Commissioner erred in law in failing to adopt a polycentric decision-making process - whether Commissioner erred in law in concluding that a centre of activity for the Business CBD rating sub-category could include a fringe - whether Commissioner erred in law in taking into account the Business zoning - whether Commissioner erred in law in failing to take into account certain aspects of critical evidence.
• Legislation Cited: Environmental Planning and Assessment Act 1979 Part 3A; Land and Environment Court Act ss 19(d), 39(2), 56A; Local Government Act 1993 ss 514, 519-527, 529, 531; Parramatta City Centre Local Environmental Plan 2007; Parramatta Local Environmental Plan 1989; Parramatta Local Environmental Plan 2011; Sydney Regional Environmental Plan No 28 - Parramatta
• Cases Cited: Barrak Corporation Pty Ltd v Parramatta City Council [2014] NSWLEC 1077; Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430; Bulga Milbrodale Progress Association Inc v Minister for Planning and Infrastructure and Warkworth Mining Ltd [2013] NSWLEC 48, (2013) 194 LGERA 347; Council of the City of Sydney v South Sydney City Council [2002] NSWLEC 129; Greenwood v Warringah Council [2013] NSWLEC 223, (2013) 200 LGERA 190; Marrickville Metro Shopping Centre Pty Ltd v Marrickville Council [2009] NSWLEC 109; Marrickville Metro Shopping Centre Pty Ltd v Marrickville Council [2010] NSWCA 145, (2010) 174 LGERA 67; Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138, (2009) 166 LGERA 379; Ranglen Investments Pty Ltd v Fairfield City Council [1996] NSWLEC 192; Warkworth Mining Limited v Bulga Milbrodale Progress Association Inc [2014] NSWCA 105, (2014) 200 LGERA 375
• Category: Principal judgment
• Parties: Barrak Corporation Pty Ltd (Applicant); Parramatta City Council (Respondent)
• Representation: COUNSEL: A M Pickles (Appellant); J J Hutton (Respondent); SOLICITORS: Barrak Lawyers (Applicant); Sparke Helmore (Respondent)
• File Number(s): 30380/14

Judgment

TABLE OF CONTENTS	Paragraphs
INTRODUCTION	1-18
STATUTORY CONTEXT	19-25
ZONING	26-47
RATING	48-51
THE COMMISSIONER'S JUDGMENT	52-67
APPEAL GROUND 1	68-81
APPEAL GROUND 2	82-90
APPEAL GROUND 3	91-97
APPEAL GROUND 4	98
APPEAL GROUND 5	99-102
APPEAL GROUND 6	103-108
ORDERS	109
ANNEXURES A & B

INTRODUCTION

1 This is an appeal under s 56A of the Land and Environment Court Act 1979 from a decision of a commissioner of the Court. As such, the appeal is limited to questions of law.

2 The case concerns the categorisation of rateable land.

3 The appellant, Barrak Corporation Pty Ltd (Barrak), is the owner of rateable land at 116 Wigram Street, Harris Park (the Property) in the Parramatta local government area. With improvements comprising one building used for the purposes of a restaurant, the Property is a triangular shaped block of 1085 square metres located on the western side of Wigram Street at the corner of, and with a secondary frontage to, Kendall Street. The Property is about mid way between Parramatta and Harris Park railway stations, on the eastern side of the railway line. The Property is approximately 450 metres from the absolute geographic centre of the City of Parramatta. Annexed hereto and marked "A" is a locality map showing the location of the Property.

4 The respondent, Parramatta City Council, has always categorised the Property as "business" for rating purposes under the Local Government Act 1993 (LGA). Since 1995 when the Council first adopted rating sub-categories, it has treated the Property as part of the Parramatta CBD for rating purposes by sub-categorising the Property as "Business CBD".

5 In the Parramatta local government area, land with a business categorisation for rating purposes attracts far higher ad valorem rates if it is sub-categorised Business CBD than if it is sub-categorised "Business General".

6 On 26 August 2013 the Council refused Barrak's application of 22 August 2013 to change the Property's rating sub-category from Business CBD to Business General. The application was made under s 525(1)(b) of the LGA. The Council's stated reasons were that the Property was well inside the current Business CBD area and the dominant use of the Property remains for the purpose of business.

7 Barrak appealed to the Court from the Council's refusal, pursuant to s 526 of the LGA. Such an appeal falls within Class 3 of the Court's jurisdiction: s 19(d) Land and Environment Court Act. The Court, constituted by a commissioner, dismissed the appeal: Barrak Corporation Pty Ltd v Parramatta City Council [2014] NSWLEC 1077.

8 Barrak now appeals from the Commissioner's decision to a judge of the Court, pursuant to s 56A of the Land and Environment Court Act.

9 A council may determine a rating sub-category for the business rating category "according to a centre of activity": s 529(2)(d) LGA. As Barrak's application to the Council nominated Business CBD as the sub-category Barrak considered the Property should be within, the Council was obliged to determine it to be within that category unless it had reasonable grounds for believing that it was not within that sub-category: s 525(3). On appeal, the Court was under the same obligation because it stood in the shoes of the Council: s 39(2) Land and Environment Court Act.

10 The Council and the Court (constituted by the Commissioner) each concluded that it had reasonable grounds for believing that the Property was not within the Business General rating sub-category but within the Business CBD rating sub-category.

11 In 1995 the Business CBD rating sub-category boundaries coincided with the Business zoning boundaries. Since then a number of different business zones have emerged under planning instruments. The Property has retained a Business zoning, namely B1 Neighbourhood Centre, under the Parramatta Local Environmental Plan 2011 (2011 LEP). The 2011 LEP applies to all land in the Parramatta local government area other than the land to which the Parramatta City Centre Local Environmental Plan 2007 (2007 LEP) applies. The 2007 LEP includes three business zones: B3 City Core, B4 Mixed Use which surrounds the B3 zone, and B5 Business Development. The Property is located in the B1 zone at its boundary with the B4 zone.

12 Barrak's primary and unsuccessful submission to the Commissioner was that while the Property's Business CBD rating sub-categorisation had logic in 1995 when that rating sub-category reflected the Business City Centre zoning, when regard is had to the changes in zoning since then, and other factors such as changes in parking controls, there are not reasonable grounds for believing that the Property is within the Business CBD centre of activity.

13 Annexed hereto and marked "B" is a map that illustrates that the Business CBD rating sub-category area generally coincides with the Business zoning areas for the B3 and B4 (and B5) zones and the B1 zone adjoining the B4 zone. The annexed map is a magnified version of part of the Council's Central Business District "Ordinary Rates" map, by reference to which the Council in 2013 adopted rating sub-categories. An extract of the Ordinary Rates map is Annexure E to the Commissioners judgment. Superimposed on the annexed map are the B1 zoning boundary in green, the B3 and B4 (and B5) zoning boundary in red, and the Business CBD rating sub-category "boundary" in blue. The six hatched properties described as "anomalous" on the annexed map on the northern side of Marion Street were considered to be potentially anomalous by the Commissioner because although, like the Property, they were within the B1 zone and used for similar purposes as the Property, unlike the Property they were within the Business General rating sub-category. The annexed map assists understanding, notwithstanding that one can quibble with the notion of a "boundary" for the Business CBD rating sub-category since the latter attaches to individual properties. Thus, the B3, B4 and B1 zones include plenty of properties coloured yellow on the annexed map, indicating that they are not used for business purposes, and thus are not within the business rating category or a sub-category thereof.

14 The Commissioner, with the benefit of a view of the area, held that the blue shaded land on the annexed map met the description "centre of activity" for the Business CBD rating sub-category. She decided that the centre of activity for the Business CBD rating sub-category comprised a core, middle and fringe and that the Property was in the fringe: at [86], [105]. Accordingly, the Commissioner dismissed the appeal.

15 In my opinion, the decision as to whether there is a centre of activity within which particular business rated land falls calls for the exercise of an evaluative judgment (as distinct from an exercise of discretion) based on the facts of the particular case, and the circumstances in which the formation of such a judgment involves an error of law are limited: Minister Administering the Crown Lands Act v Bathurst Local Aboriginal Land Council [2009] NSWCA 138, (2009) 166 LGERA 379 at [204]. There (omitting citations) Basten JA referred to:

...a broad evaluative judgment to be made according to the facts of the particular case. The formation of such a judgment can involve an error of law, but the circumstances in which it will do so are limited. Such an error may arise where the facts as found are reasonably open to only one conclusion in application of the statutory language. Care must be taken not to allow disagreement with an outcome in the court below to be transformed into an inference that, despite accurately and correctly expressing the legal test, and identifying the facts, the primary judge failed to apply the test as identified. Such an exercise may involve the use of an outcome which was reasonably open on the facts, to contradict an earlier statement as to the principles applied. It would be an unusual case in which this form of reverse engineering of the judgment below would be legitimate.

16 Barrak generally accepts that the Commissioner correctly stated the law and correctly identified the primary facts, but contends that nonetheless an error of law has occurred, in that the Commissioner did not apply the law as she stated it. As Barrak submits: "the Commissioner did ask the correct question [under s 525(3)] and adopted the correct test at the outset but applied that test incorrectly to all of the facts".

17 The notice of appeal contains six grounds of appeal from the Commissioner's decision. Barrak presses the first four, does not press the fifth and presses part of the sixth. Shortly expressed, the grounds pressed are:

(1) The Commissioner identified the correct test under s 525(3) (whether there are reasonable grounds to conclude that the Property is not within the Business General rating sub-category) but erred in failing to apply that test because she asked the converse question whether it was not within the Business CBD rating sub-category.

(2) The Commissioner erred in failing to adopt a polycentric decision-making process.

(3) The Commissioner erred in concluding that a centre of activity for the Business CBD rating sub-category could include a fringe.

(4) Not pressed.

(5) The Commissioner erred in taking into account the Business zoning of the Property.

(6) The Commissioner erred in failing to take into account certain aspects of critical evidence.

18 In my opinion, the grounds of appeal advanced do not establish any error of law. Generally, they find fault with findings about primary facts or with the evaluative judgment that the Commissioner was required to make, on the basis of the primary facts, as to the "centre of activity" referred to in s 529(2)(d) (read with s 531) of the LGA. Accordingly, I propose to dismiss the appeal.

STATUTORY CONTEXT

19 Before making an ordinary rate, a council must have declared each part of rateable land in its area to be within one of four categories - farmland, residential, mining or business: s 514 LGA. A note to s 514 indicates that the business rating category is the residual category:

"Land falls within the business category if it cannot be categorised as farmland, residential or mining. The main land uses that will fall within the 'business' category are commercial and industrial".

20 Section 529 of the LGA empowers a council to determine sub-categories and to make different ordinary rates for different sub-categories:

529 Rate may be the same or different within a category

(1) Before making an ordinary rate, a council may determine a sub-category or sub-categories for one or more categories of rateable land in its area.

(2) A sub-category may be determined:

...

(d) for the category "business"-according to a centre of activity.

Note. In relation to the category "business", a centre of activity might comprise a business centre, an industrial estate or some other concentration of like activities.

(3) The ad valorem amount (the amount in the dollar) of the ordinary rate may be the same for all land within a category or it may be different for different sub-categories.

...

[emphasis added]

21 Sections 519 to 527 of the LGA are expressed to apply to categorisation of land. However, s 531 provides that they likewise apply to the determination of sub-categories.

22 Section 525 (read with s 531) provides for an application for a change of sub-category:

525 Application for change of category

(1) A rateable person (or the person's agent) may apply to the council at any time:

...

(b) to have the person's rateable land declared to be within a particular category for the purposes of that section.

(2) An application must be in the approved form, must include a description of the land concerned and must nominate the category the applicant considers the land should be within.

(3) The council must declare the land to be within the category nominated in the application unless it has reasonable grounds for believing that the land is not within that category.

(4) If the council has reasonable grounds for believing that the land is not within the nominated category, it may notify the applicant of any further information it requires in order to be satisfied that the land is within that category. After considering any such information, the council must declare the category for the land.

(5) The council must notify the applicant of its decision. The council must include the reasons for its decision if it declares that the land is not within the category nominated in the application.

...

[emphasis added]

23 A rateable person who is dissatisfied with a category declaration or (by virtue of s 531) a sub-category determination of a council under s 525 may appeal to this Court: s 526.

24 Barrak's application to the Council under s 525(1)(b) nominated Business General as the rating sub-category that Barrak considered the Property should be within. Section 525(3) thereupon came into play. Consequently, the Council was obliged to determine that the Property was in the Business General rating sub-category unless the Council had reasonable grounds for believing that it was not within that sub-category.

25 Barrak exercised its right under s 526 of the LGA to appeal to this Court from the Council's refusal of the application. On such an appeal, the Court stands in the shoes of the Council: s 39(2) Land and Environment Court Act. Therefore, the Court on that appeal was also obliged to determine that the Property was in the Business General rating sub-category unless the Court had reasonable grounds for believing that the Property was not within that rating sub-category. In that appeal it was - and still is - common ground that Business CBD is the only possible alternative rating sub-category to Business General for the Property.

ZONING

26 The Commissioner reviewed the zoning history under the planning controls at [18]-[33], the rating history at [34]-[36], and annexed a locality map, two zoning maps and two rating maps. The parties do not challenge the accuracy of that review.

27 The Property's zoning has changed over time:

• Under the Parramatta Local Environmental Plan 1989 (1989 LEP), the Property was on the edge of and just within the Business 3(f) City Centre Zone.
• Under the 1999 Sydney Regional Environmental Plan No 28 - Parramatta (SREP 28), which replaced the 1989 LEP and created precincts, the Property continued to have a Business zoning and was located just within the Harris Park Precinct, next to the adjoining Parramatta City Centre Precinct.
• Under the 2011 LEP, the Property is on the edge of and just within the B1 Neighbourhood Centre Zone. It is just outside the B4 Mixed Use zone under the 2007 LEP. As stated earlier, the 2011 LEP applies to the land in the Parramatta local government area other than the land to which the 2007 LEP applies. The 2007 and 2011 LEPs replaced SREP 28.

1989 LEP

28 Under the 1989 LEP, the Property was zoned 3(f) City Centre. An extract from the 1989 LEP zoning map is at Annexure B to the Commissioner's judgment. The Property is marked with an X. This map included three Business zones: 3(d) Automotive Business, 3(f) City Centre, and 3(f-r) City Centre (Retail). The 3(f-r) City Centre (Retail) zone included the land now developed as Westfield shopping centre on the southern side of the railway line. The 3(f) and 3(d) zoned land was generally located around the 3(f-r) zone.

29 The objectives of the 3(f-r) City Centre (Retail) zone were:

(a) to maintain and enhance the retail functions of the city central spine, by encouraging shops and similar pedestrian oriented uses;

(b) to limit office development in the interests of maintaining retail core functions as well as restricting overshadowing of pedestrian malls and places;

(c) to maximise pedestrian convenience and comfort; and

(d) to provide for other development which complements or supports the primary retail function of the zone, particularly on sites or parts of sites which do not front major pedestrian routes.

30 The objectives of the 3(f) City Centre zone were:

(a) to encourage office and commercial development appropriate to the Centre's status and regional functions;

(b) to ensure the development is arranged and carried out in a way that maximises convenience and comfort for pedestrians;

(c) to ensure that development is arranged and carried out in a way that preserves views to and from the Centre, and appropriately relates to items of environmental heritage within the Centre;

(d) to ensure that developers contribute to the supply of parking in the Centre whether on site or otherwise, having regard to the capacity of the street system immediately adjoining the site;

(e) to accommodate other development which complements or supports the primary office functions of the zone; and

(f) to ensure that the major use of any land within the zone is for commercial or office development than for retail development.

31 To the east of the Property, the land bound by Una Street, Wigram Street, Marion Street and Harris Street was included in the 2(g) Residential Conservation zone. The objectives of the 2(g) zone were:

(a) to encourage the conservation of residential areas which include individual buildings and streets of heritage significance; and

(b) to enable economic uses of existing buildings so as to assist in their conservation.

32 A number of properties located in the 2(g) zone were listed as items of environmental heritage in Schedule 2 to the 1989 LEP.

SREP 28

33 In 1999 the Minister made SREP 28, which repealed the 1989 LEP. SREP 28 applied to the land in the Parramatta local government area referred to as the Parramatta Primary Centre and created six precincts including City Centre Precinct, Harris Park Precinct (immediately east of City Centre Precinct), and Government Precinct (immediately west of City Centre Precinct). The Property was in the Harris Park Precinct just outside the City Centre Precinct. The 1989 LEP continued to apply to the Harris Park precinct for two years after SREP 28 was made.

34 The City Centre Precinct included the area previously zoned 3(f-r) City Centre (Retail) under the 1989 LEP, and some properties previously zoned 3(f) City Centre and 3(d) Automotive Business under the 1989 LEP to the west of the railway line. The City Centre Precinct had seven land use zones: City Core, Retail Core, City Edge, Automotive Business, Special Uses, Open Space and Transport. The City Edge zone included the land opposite the Property on the northern side of Kendall Street, and on the eastern side of Wigram Street to Ruse Street.

35 Within the Harris Park Precinct the Property was in the Business zone, next to the City Edge zone in the City Centre Precinct. Also zoned Business was land on the eastern side of the railway line that had previously been in the 3(f) City Centre zone under the 1989 LEP and land on the southern side of Marion Street to Harris Street that had previously been in the 3(f-r) City Centre (Retail) zone under the 1989 LEP. Within the Harris Park Precinct, land to the south, and on the eastern side of Wigram Street, was zoned Residential 2(a). Eight lots on the northern side of Marion Street between Wigram Street and Harris Street, also zoned Business, had been in the 2(g) Residential Conservation zone under the 1989 LEP.

36 SREP 28 was repealed and replaced by the Council's 2007 LEP and 2011 LEP.

2007 LEP

37 The 2007 LEP applies to the land formerly in the City Centre Precinct and the majority of the land formerly in the Government Precinct under SREP 28. The aims of the 2007 LEP include:

(1) This Plan aims to make local environmental planning provisions for land in the Parramatta city centre that are generally in accordance with the relevant standard environmental planning instrument under section 33A of the Act.

(2) The particular aims of this Plan are as follows:

(a) to promote the economic revitalisation of the Parramatta city centre,

(b) to provide a planning framework for Parramatta to fulfil its role as a primary centre in the Sydney Metropolitan Region,

(c) to protect and enhance the vitality, identity and diversity of the Parramatta city centre and promote it as a pre-eminent centre in the Greater Metropolitan Region,

(d) to promote employment, residential, recreational, arts, social, cultural and tourism opportunities within the Parramatta city centre,

...

38 The 2007 LEP zones B3 Commercial Core an area in the centre of Parramatta to the east of Church Street and extending as far south as Hassall Street. Zone B3 is surrounded by land zoned B4 Mixed Use, which had formerly been in the City Centre Precinct and zoned City Edge under SREP 28. There is also a zone B5 Business Development in Church Street being the automotive business area. The relationship between the B3 and B4 zones is clarified in the stated objectives for each zone. Those for the B3 zone include:

· To provide a wide range of retail, business, office, entertainment, community and other suitable land uses which serve the needs of the local and wider community, including:

· commercial and retail development,

· cultural and entertainment facilities that cater for a range of arts and cultural activity, including events, festivals, markets and outdoor dining,

· tourism, leisure and recreation facilities,

· social, education and health services.

...

· To strengthen the role of the Parramatta city centre as the regional business, retail and cultural centre, and as a primary retail centre in the Greater Metropolitan Region.

39 The objectives for the B4 zone include:

To support the higher order Commercial Core Zone while providing for the daily commercial needs of the locality, including:

· commercial and retail development,

· cultural and entertainment facilities that cater for a range of arts and cultural activity, including events, festivals, markets and outdoor dining,

· tourism, leisure and recreation facilities,

· social, education and health services,

· high density residential development.

40 The permitted uses in the B4 zone are:

2 Permitted without consent

Nil

3 Permitted with consent

Any other development not otherwise specified in item 2 or 4

4 Prohibited

Car parks (except those required by this Plan or public car parking provided by or on behalf of the Council); Caravan parks; Dual occupancies; Dwelling houses; Extractive industries; Home occupation (sex services); Industries; Light industrial retail outlets; Mines; Vehicle body repair workshops; Warehouse or distribution centres.

2011 LEP

41 The 2011 LEP applies to the land in the Parramatta local government area other than the land to which the 2007 LEP applies. Annexure C to the Commissioner's judgment is an extract from the LEP 2011 zoning map. The Property is marked with an X.

42 The 2011 LEP provides for four Business zones. The area in which the Property is located, at the boundary between the 2007 LEP and the 2011 LEP, has a Business zoning of B1 Neighbourhood Centre. Also zoned B1 Neighbourhood Centre under the 2011 LEP are other properties that (like the Property) had been included in the Business zone within the Harris Park Precinct under SREP 28 (as well as several lots on the eastern side of Harris Street at the intersection with Marion Street). The objectives and permitted uses of the B1 Neighbourhood Centre zone are:

Zone B1 Neighbourhood Centre

1 Objectives of zone

· To provide a range of small-scale retail, business and community uses that serve the needs of people who live or work in the surrounding neighbourhood.

2 Permitted without consent

Home occupations

3 Permitted with consent

Bed and breakfast accommodation; Boarding houses; Building identification signs; Business identification signs; Business premises; Child care centres; Community facilities; Health consulting rooms; Hostels; Medical centres; Neighbourhood shops; Respite day care centres; Roads; Shop top housing; Water recycling facilities; Any other development not specified in item 2 or 4

4 Prohibited

Agriculture; Air transport facilities; Airstrips; Amusement centres; Animal boarding or training establishments; Boat building and repair facilities; Boat launching ramps; Boat sheds; Bulky goods premises; Camping grounds; Caravan parks; Cemeteries; Charter and tourism boating facilities; Correctional centres; Crematoria; Depots; Eco-tourist facilities; Electricity generating works; Entertainment facilities; Exhibition homes; Exhibition villages; Extractive industries; Farm buildings; Forestry; Freight transport facilities; Function centres; Garden centres; Hardware and building supplies; Health services facilities; Heavy industrial storage establishments; Helipads; Highway service centres; Home industries; Home occupations (sex services); Industrial retail outlets; Industrial training facilities; Industries; Jetties; Landscaping material supplies; Marinas; Mooring pens; Moorings; Mortuaries; Open cut mining; Passenger transport facilities; Plant nurseries; Port facilities; Pubs; Recreation facilities (major); Registered clubs; Research stations; Residential accommodation; Restricted premises; Rural industries; Rural supplies; Sewerage systems; Sex services premises; Signage; Storage premises; Timber yards; Tourist and visitor accommodation; Transport depots; Truck depots; Vehicle body repair workshops; Vehicle repair stations; Vehicle sales or hire premises; Warehouse or distribution centres; Waste or resource management facilities; Water recreation structures; Water supply systems; Wharf or boating facilities; Wholesale supplies

43 Whilst the objective and permitted uses for the B1 zone are not the same as those for either of the B3 or B4 zones, the B1 zone includes a range of permissible business and retail uses - including relevantly a restaurant or café - and prohibits residential accommodation other than specified limited types.

44 The land in the vicinity of the Property formerly zoned Residential 2(a) under SREP 28 is now zoned R2 Low Density Residential under the 2011 LEP. The objectives and permitted uses in the R2 zone are:

Zone R2 Low Density Residential

1 Objectives of zone

· To provide for the housing needs of the community within a low density residential environment.

· To enable other land uses that provide facilities or services to meet the day to day needs of residents.

· To ensure that non-residential land uses are located in a context and setting that minimises impacts on the amenity of a low density residential environment.

· To allow for a range of community facilities to be provided to serve the needs of residents, workers and visitors in residential neighbourhoods.

2 Permitted without consent

Home occupations

3 Permitted with consent

Bed and breakfast accommodation; Boarding houses; Building identification signs; Business identification signs; Community facilities; Dual occupancies; Dwelling houses; Educational establishments; Emergency services facilities; Environmental facilities; Environmental protection works; Exhibition homes; Exhibition villages; Flood mitigation works; Group homes; Health consulting rooms; Home-based child care; Home businesses; Home industries; Hospitals; Hostels; Neighbourhood shops; Public administration buildings; Recreation areas; Recreation facilities (indoor); Recreation facilities (outdoor); Roads; Seniors housing; Water recycling facilities

4 Prohibited

Any development not specified in item 2 or 3

45 The Commissioner noted that it was apparent on her view of the area, and confirmed by a schedule of properties in the Harris Park locality rated as business prepared by the Council, that several of the properties in the R2 zone in the locality of the Property are used for commercial or retail purposes. Those uses include restaurants, take away food shops, supermarket, and professional offices. Some of those properties have been subject to the business rating category since 1995, while others have only recently been categorised as business. The Heritage Map for the 2011 LEP shows that the area bound by Kendall Street, Station Street East, Marion Street, Harris Street and Una Street, is the Harris Park West Conservation Area, and that the majority of the lots in that Heritage Conservation Area (not including the Property) are identified as individual heritage items. It was common ground before the Commissioner that many of those properties listed as heritage items in Schedule 5 of the 2011 LEP are used for commercial purposes pursuant to approvals under the conservation incentive provisions of the 2011 LEP.

Proposal for LEP amalgamation

46 The Council has prepared a Planning Proposal to amend the 2011 LEP so as to amalgamate the 2007 LEP and the 2011 LEP. The Planning Proposal has been exhibited and forwarded to the Department of Planning for drafting. In November 2013 the Council was advised that the amalgamated planning instrument would possibly be made within six to nine months.

Commissioner's conclusion

47 The Commissioner concluded that, when considered together, the zoning provisions in the 2007 LEP and the 2011 LEP reflect an area that has a central core, a surrounding commercial and business area, and an area at the fringe in which the Property is located: at [86], [105].

RATING

48 On 17 July 1995 the Council resolved, for the first time, to create rating sub-categories for business rating categorised land, and made rates according to those sub-categories for the 1995-1996 year. The Property fell within the "Central Business District" rating sub-category, which was described in the resolution as the land zoned business in the 1989 LEP. The 1989 LEP zoning map is Annexure B to the Commissioner's judgment. Other rating sub-categories were described in the resolution as "Industrial Centre of Activity" Nos 1-23 and identified by reference to a map. There was also a residual sub-category. The Council made a higher ad valorem rate for the Central Business District rating sub-category than for the other rating sub-categories.

49 On 10 July 2000 the Council, when resolving to make rates for different business rating sub-categories, for the first time identified the Central Business District rating sub-category as the land coloured blue "Centre of Activity" on a map, which included the Property. An extract of this map is at Annexure D to the Commissioner's judgment. The Commissioner noted that this blue land corresponded with Business zones 3(d), 3(f) and 3(f-r) under the 1989 LEP: at [39].

50 On 24 June 2013 the Council by resolution made ordinary rates for the ensuing year, by reference to various sub-categories of business rated land shown on a 2013 Council map for the whole Parramatta local government area, titled "Ordinary Rates". An extract of the Ordinary Rates map is annexure E to the Commissioner's judgment. Three of those business rating sub-categories were described to the following effect:

(a) "Business General" rating sub-category land is that which is not within other sub-categories of Business land identified in the resolution. Thus, I observe, it is a residual sub-category. It is the orange land in the Ordinary Rates map. It includes land used for commercial or retail purposes to the south of the Property on the opposite side of Wigram Street in the R2 Low Density Residential zone under the 2011 LEP.

(b) "Central Business District" rating sub-category. There was a typographical error in the resolution for (as is common ground) it is in fact the land described as "Business CBD" and coloured light blue on the Ordinary Rates map. The Commissioner noted that it is the same shape as the area coloured light blue on the 1989 LEP Centre of Activity map, although some areas near the City Centre have been excluded: at [42].

(c) A small area called "Business CBD Centre of Activity" (the Westfield site) coloured dark blue on the Ordinary Rates map.

51 The Ordinary Rates map colours yellow "Residential Suburban" rated land.

THE COMMISSIONER'S JUDGMENT

52 The Commissioner summarised the position of each party, at [8]-[9]:

8 Barrak's position is that while the categorisation of the property in the Business CBD sub-category had some logic in 1995 when the Business CBD sub-category reflected the zoning, when regard is had to the changes in planning controls since then, and other factors such as changes in parking controls, there are not reasonable grounds for believing that the property is within the centre of activity that is CBD. Barrak submits that it is sufficient that the zoning of the property has changed. Other factors that would also support the change in sub-category are that the physical uses and built form are materially different to those in the CBD, so that the property can no longer be regarded as being in the CBD; that with such matters as removal of parking meters and changes to parking controls the property is in an area which is not part of the CBD; that the steps taken to review the categorisation of Harris Park land more generally indicate that the Council has not turned its mind to the question of whether the property should continue to be categorised as Business CBD; and that fairness would be relevant in a merits review in deciding that there is no reasonable basis for having the property in the CBD sub-category.

9 The Council's position is that this appeal is not a challenge to the creation of the sub-category, and the Court must take the sub-category as it finds it. It is sufficient that the property is located in the area identified in the Central Business District Centre of Activity rating map. If, contrary to that position, if it is necessary to identify a "centre of activity" for the property to continue to be in the Business CBD sub-category, there are a number of factors which point to the property being within such a centre of activity, including the spatial geography, the diversity of land uses and business in the CBD centre of activity, the exclusion of highly intensive retail activity from the CBD centre of activity, the diverse range of built forms in the CBD centre of activity and the constraints of heritage considerations, the range of levels of public infrastructure and parking restrictions, the inclusion in the centre of activity of a number of natural barriers and dividing lines, the existence of a core or middle area and fringe areas of the centre of activity, and the concentration of businesses rather than residential uses in the centre of activity.

53 The Commissioner addressed the legislation, planning controls and rating sub-categorisation over time at [10]-[46]. She observed that the Business General rating sub-category is, and for many years has been, a residual sub-category: at [34], [38], [40]. After considering the nature of the appeal to the Court at [47]-[58], the Commissioner correctly identified the issue in the appeal at [58]:

In my view, having regard to the language used in s 525(3), applying s39(2) of the Court Act, and having regard to the relevant authorities, the issue to be determined in this appeal is whether there are reasonable grounds to believe that the property is not within the Business General sub-category. If there are not, the property should remain in the Business CBD category, there being no other candidate sub-categories.

54 The Commissioner considered at [59]-[66], and decided in Barak's favour at [66], that the determination of whether there are reasonable grounds to believe that the Property is not within the Business General rating sub-category cannot be answered merely by reference to a map such as the blue shaded area on the Ordinary Rates map.

55 The Commissioner then considered the meaning of "centre of activity" in s 529(2)(d) of the LGA: at [67]-[77]. The Commissioner cited the following authorities: Ranglen Investments Pty Ltd v Fairfield City Council [1996] NSWLEC 192 (Bannon J); Council of the City of Sydney v South Sydney City Council [2002] NSWLEC 129 (Pearlman CJ of LEC); and Marrickville Metro Shopping Centre Pty Ltd v Marrickville Council [2009] NSWLEC 109 (Pain J), upheld on appeal Marrickville Metro Shopping Centre Pty Ltd v Marrickville Council [2010] NSWCA 145, (2010) 174 LGERA 67. The Commissioner accepted the following six propositions put by the Council (Barrak agreed with the first five and now does not challenge the sixth), at [70]-[72]:

(1) The words "centre of activity" should be given their ordinary meaning (Marrickville Metro (Pain J) at [46]; Marrickville Metro (CA) at [79]; and they should not be read down by reference to departmental policies or other extrinsic materials: Ranglen;

(2) The note in s 529(1), which states "[i]n relation to the category 'business', a centre of activity might comprise a business centre, an industrial estate or some other concentration of like activities") is a relevant aid to construction: Marrickville Metro (Pain J) at [47]; however, it should not be read as restricting or overriding the ordinary meaning of the expression "centre of activity": Ranglen;

(3) A centre of activity need not be a centre of "like activities" - it may be comprised of "a number of enterprises involving different activities": Ranglen (in that case including both retail and industrial activities); and Marrickville Metro (Pain J) at [43], that the council may determine a sub-category in respect of a "single site on which several activities are located";

(4) A centre of activity will normally involve "a concentration of activities" within a particular area or around a particular site: Marrickville Metro (Pain J) at [46]; Marrickville Metro (CA) at [79]). While the word "centre" requires some kind of geographical connection between activities carried out on the parcels of rateable land within the sub-category, the connection need not be of any particular kind (it can be large or small, depending on how the council defines it);

(5) A centre of activity may be tightly compressed and homogeneous (for instance, the 100 tenancies in Marrickville Metro, all of which were retail premises and on one lot), or more diverse, for example the more loosely described centre of activity in Ranglen which encompassed a variety of land uses and different geographical areas on each side of The Horsley Drive; and

(6) The label affixed to the category (in this case "Central Business District" or "CBD") is not important - what matters is the characteristics of the area to which the category applies: Marrickville Metro (Pain J at [43]-[44]; Marrickville Metro (CA) at [81]-[84]).

56 The Commissioner elaborated on these propositions, at [76]-[77]:

76 Propositions (3), (4) and (5) are critical in considering what is a "centre of activity". The facts in Ranglen and Marrickville Metro illustrate the diversity of factors that might be considered by a council in determining a relevant centre of activity. The "large integrated shopping complex" (as the Marrickville Metro was described by Tobias JA [2010] NSWCA 145 at [79])) occupying a single site is in contrast with the larger area, on both sides of The Horsley Drive, Fairfield, which included both retail and industrial zoning and uses, considered to be a centre of activity in Ranglen. In City of Sydney, the "centre" of population and of activity was a suburb.

77 In my view, the use of the word "activity" in "centre of activity" can encompass a range of different types of activity such as commercial and retail, so that a "centre" of activity may comprise a number of enterprises involving different activities, which need not be "like activities". There must be some geographical connection between the activities carried out on the parcels of rateable land within the area, which would normally involve a concentration of activity within a particular area or around a particular site, so that there can be said to be a "centre". The geographical connection need not be confined or compressed and homogeneous, for example as in Ranglen where the relevant centre of activity occupied different geographical areas on both sides of what Bannon J described as "an important transport link and busy road". The concept of a centre of activity is primarily a geographic one, and requires some agglomeration or concentration of business activity (using the word "business" in its broadest sense) within the specified area.

57 The Commissioner turned to the next question: whether there is an area that can properly be regarded as being a "centre of activity", in which the Property is located: at [78]-[103].

58 The Commissioner concluded that, when considered together, the zoning provisions of the 2007 LEP and 2011 LEP reflect a centre of business and commercial activity; that it comprises a core, middle and fringe; and that the Property is located in the fringe: at [86], [103], [105]. She was satisfied that there are reasonable grounds for believing that the Property is not within the Business General rating sub-category, and that it can properly be regarded as being within the Business CBD rating sub-category. Accordingly, she dismissed the appeal: at [106].

59 In reaching that conclusion, the Commissioner considered each party's submissions. She summarised Barrak's submissions, which primarily emphasised the zoning, at [79]:

Barrak submits that the zoning of the property is fundamental in understanding whether it is within the relevant "centre of activity". Additional factors are the label applied to describe the sub-category; the physical uses and built form which are materially different to those on the northern side of Kendall Street and on the western side of the railway; the removal of parking meters and changes in parking restrictions in the Harris Park area; the way in which the Council approached the rating of Harris Park in 2013; and whether it is fair and equitable to impose the Business CBD rates on the property.

60 The Commissioner recorded Barrak's submissions as to the relationship between the Business zoning and rating areas, at [80]-[81]:

80 Considering first the zoning of the property, Barrak submits that the Business zoning under the 1989 LEP was the only reason to create the Business CBD sub-category initially and to include this property in that sub-category. That was reasonable in 1995, when the property was identically zoned to the land in the CBD core and to the north of Parramatta. However, the property is now zoned B1 Neighbourhood Centre, while the land on the other side of Kendall Street, the land in the block between Una Street, Wigram Street, Harris Street and Parkes Street, and the land on the other side of the railway line is zoned B4, while other land closer to the centre of Parramatta is zoned B3. Barrak submits that when the property was placed in the Harris Park Precinct under the Parramatta REP in 1999 a significant change in planning intent occurred. The objectives for the Business zone under Part 4 Precinct 2 - Harris Park Precinct were provided in cl 29F(1) (emphasis added):

(a) to provide opportunities for low scale retail and commercial development which supports surrounding residential development,

(b) to encourage the integration of commercial centres with public transport and pedestrian networks,

(c) to meet the urban design objectives set out in this Part and (where applicable) to comply with the controls for Special Areas as set out in this Part.

81 Barrak submits that the objectives of the City Core, Retail Core and City Edge zones within Precinct 1- City Centre Precinct were markedly different, and the introduction of the REP cannot be regarded as an "administrative carve up". It represented a down-zoning of the property, with the creation of the City Core, Retail Core and City Edge zones, and the separate Harris Park precinct. While the making of the Parramatta REP did not affect ratings, given the Council's resolution in 1995 it ought to have recognised that the making of the REP left its earlier rating decision without a rationale, and that when the REP was made that was a strong indication that the Harris Park precinct was not part of the city centre of Parramatta.

61 The Commissioner recorded the Council's submissions in that regard, at [82]:

82 The Council submits that the centre of activity need not, and generally would not, coincide with any local environmental plan boundaries or zoning boundaries, and that the argument that the actual zoning matters in determining ratings sub-categories must fail. First, zoning and rating processes are entirely separate, being effected under different statutes and by different levels of government, and there is no basis for the submission that the ratings sub-category should coincide with zoning boundaries. Secondly, there are several different zonings under the 2007 LEP, and the rating sub-category must be able to accommodate more than one zoning on the applicant's own case. Thirdly, when a comparison is made between the ratings categories and sub-categories and the Harris Park zoning map under the 2011 LEP, there would be many ratepayers situated next to higher zoned land (including B4 land) who are subject to the same rating as the higher zoned land. Fourthly, if the zoning is relevant in the way submitted by the applicant, then the CBD centre of activity boundary does accord with zoning to some extent, as it takes in the B4 Mixed Use zoning within the 2007 LEP and that part of Harris Park zoned B1 Neighbourhood Centre. The Council submits that the legal source of the zoning objectives and restrictions applying to particular property is just an administrative arrangement, stemming in the circumstances here from the re-organisation effected by the Parramatta REP, and that it does not matter whether it is the 2007 LEP or the 2011 LEP that applies, which is underscored by the proposed amendments to the 2011 LEP so that one instrument will apply across the Parramatta LGA.

62 The Commissioner accepted those Council submissions, at [83]. She said that there is no basis for a suggestion that rating sub-categories, which depend either on actual use or a spatial criterion, should "necessarily" reflect the zoning:

83 I accept the Council's submissions. The zoning history since the 1989 LEP reflects decisions both of the Council and the NSW Government, the latter primarily in the decision to make the Parramatta REP in 1999 which, among other things, removed the centre of Parramatta from the local planning controls when separate planning controls were applied to Precinct 1-City Centre and Precinct 3-Government. The subsequent planning history, including the addition to the Parramatta REP of controls for the Harris Park Precinct, the continuation of separate controls for the city centre in the 2007 LEP, and the proposed amalgamation of the 2007 LEP and 2011 LEP, reflects the exercise of different legislative powers, at different levels of government, at different times, and for different purposes to those exercised for rating purposes under the LG Act. There is in my view no basis for a suggestion that rating sub-categories which depend either on actual use, or by reference to a spatial criterion, should necessarily reflect the zoning, even if the zoning might be the basis (whether for convenience or otherwise) on which the boundaries of the sub-category are at any point of time determined, or identified...

63 Nevertheless, the Commissioner considered that the zoning was a relevant factor and that it generally supported the Council's Business CBD rating sub-category for the Property, at [83]-[88]:

83 ...Further, to the extent that the zoning is significant in determining whether there is a centre of activity, and if so, whether particular land is within that centre of activity, there are two reasons why that is not determinative in the circumstances of this case, and in any event would lend support to the Council's determination that the property is within the relevant sub-category.

84 First, the 2007 LEP and the 2011 LEP need to be considered together to obtain a complete picture of the zoning. The 2007 LEP includes an area in the centre of Parramatta to the east of Church Street and extending as far south as Hassall Street which is zoned B3 Commercial Core, which is surrounding by land zoned B4 Mixed Use. The relationship between the two is made clear in the stated objectives for each zone. Those for the B3 zone include:

·To provide a wide range of retail, business, office, entertainment, community and other suitable land uses which serve the needs of the local and wider community, including...

...

·To strengthen the role of the Parramatta city centre as the regional business, retail and cultural centre, and as a primary retail centre in the Greater Metropolitan Region.

85 The objectives for the B4 zone include:

To support the higher order Commercial Core Zone while providing for the daily commercial needs of the locality, including:

· commercial and retail development,

· cultural and entertainment facilities that cater for a range of arts and cultural activity, including events, festivals, markets and outdoor dining,

· tourism, leisure and recreation facilities,

· social, education and health services,

· high density residential development.

86 The area in which the property is located, at the boundary between the 2007 LEP and the 2011 LEP, has a business zoning, B1 Neighbourhood Centre. While the objectives and permitted uses are not the same as those for either the B3 or B4 zones, the B1 zone includes a range of permissible business and retail uses, including relevantly, a restaurant or café, and prohibits residential accommodation other than specified limited types. When considered together, the zoning provisions in the 2007 LEP and the 2011 LEP reflect an area that has a central core, a surrounding commercial and business area, and an area at the fringe in which the property is located. While the detail of the zone objectives and permissible and prohibited uses, has changed since the 1989 LEP, that is consistent with the approach adopted in that LEP with its 3(f-r) and 3(f) business zones. The proposal to amalgamate the 2007 LEP into the 2011 LEP does not change that.

87 Secondly, having regard to the land that is used for commercial or retail purposes but is not included in the Business CBD sub-category, the land on the eastern side of Wigram Street and extending south along Wigram Street to Marion Street is zoned R2 Low Density Residential. The only form of commercial or retail use permissible with consent in that zone is "neighbourhood shops", and it was common ground that the businesses presently operating in that area, in particular as restaurants, are doing so either as some form of existing use or pursuant to the conservation incentive provision in cl 5.10 of the 2011 LEP. Leaving aside any difference that this might make to the land value and thus to the actual amount of rates paid, the zoning of the subject property as B1 Neighbourhood Centre incorporates higher development potential than is the case for the businesses on the other side of Wigram Street which are zoned R2. It does not suggest that the property, and the other land zoned B1, more properly belongs in the same sub-category as those residential zoned properties.

88 Rather than it being the inclusion of land zoned B1 Neighbourhood Centre in the Business CBD sub-category together with land zoned B3 or B4, if there is an anomaly it would seem to be with the eight lots on the northern side of Marion Street (to the south of the subject property) between Wigram Street and Harris Street that were zoned Residential Conservation 2(g) under the 1989 LEP, re-zoned Business in 2001 under the Parramatta REP, and now B1 Neighbourhood Centre under the 2011 LEP. Those lots are not included in the Business CBD sub-category on the Centre of Activity Map, and for rating purposes, are either Residential or Business General on the Ordinary Rates Map. However, whether or not those properties could be regarded as being in the relevant centre of activity is not a matter that needs to be considered in this appeal.

[emphasis added]

64 The Commissioner at [89]-[97] then gave consideration to the additional factors on which Barrak placed reliance, which she had earlier identified at [79]. She did not regard the label attached to the Business CBD rating sub-category as necessarily significant, for the reasons she had earlier provided at [72]: at [89]-[90]. She regarded physical uses and built form, and cohesion, as significant and said that she would consider them in more detail later in her judgment: at [91]. She did not think the changes to parking controls (including removal of parking meters in the vicinity of the Property) or the way in which the Council approached the rating of Harris Park in 2013 supported the proposition that the Property was not within the Business CBD rating centre of activity: at [93]-[96]. She considered that any general concept of "fairness" had a limited role in the context of the appeal: at [97]-[100].

65 The Commissioner considered further factors proposed by the Council as relevant in consideration of the characteristics of the asserted centre of activity, and Barrak's response: at [100]-[101]. She concluded that the distance from a centre core would not of itself indicate that the Property is not within the Business CBD Centre of activity; but there must be some geographical connection between the activities carried on. She considered that the area included in the Ordinary Rates map included a diverse range of land uses, business types and built forms; that those in the area which includes the Property and extends towards the centre of Parramatta can generally be described as predominantly business or mixed use rather than solely residential; and that those uses and built forms reflect some geographical factors, but more importantly reflect the zoning history and, significantly, the constraints imposed by the heritage considerations. She observed that there is much less uniformity of built form and uses away from the city centre. She noted that the area on other side of the railway line at the intersection of Marion and Cowper Streets, which is also in the Business CBD sub-category, has a mix of heritage houses, small businesses and residential uses, similar in character to the area where the Property is located: at [102].

66 After considering the parties' further submissions, the Commissioner reiterated, at [103]:

I agree with the Council that there is a centre of activity with a core and middle areas and areas around the fringes. While it could not be described as homogeneous, a centre of activity need not be, and can be more diverse. In my view the property can properly be regarded as being within that centre of activity.

67 Finally, the Commissioner summarised her conclusions, leading to dismissal of the appeal, at [104]-[106]:

104 The property is within the area identified by the Council in 1995 in its determination of the Business CBD sub-category, initially on the basis of its zoning under the 1989 LEP and since 2000 by reference to the map, as a centre of activity for the purposes of s 529(2)(d) of the LG Act. While I have concluded that inclusion in an area specified on a map would not of itself be sufficient to be satisfied that the property is within the relevant centre of activity, there are a number of factors that establish that there is a centre of activity as shown on that map, and that the property is appropriately included within it. First, while there have been changes in the applicable planning instruments since the 1989 LEP, through the changes made by the Parramatta REP, the subsequent application of the 2007 LEP to the area formerly included within the City Centre and Government Precincts, and the inclusion of the property in the land to which the 2011 LEP applies, the property has retained a business zoning. While I accept that the B1 Neighbourhood Centre zoning is different to the B3 zoning of land in the centre of Parramatta and the B4 zoning of land between that centre and the subject property, it is still a business zoning which permits a range of business and commercial uses. That has to be contrasted with the land in the care bounded by Una, Wigram, Marion and Harris Streets which is zoned R2, much of which is subject to heritage constraints, and where those properties used for commercial purposes are within the Business General sub-category. There is not homogeneity from the other side of Kendall Street towards the centre of Parramatta, either in the zoning (which is B3 at the centre and B4 in the area closest to the subject property), or in the range of built form and uses.

105 The area shown on the Ordinary Rates Map as a centre of activity includes a diverse range of built forms and uses, which can generally be described as reflecting a concentration of business or commercial uses, and including residential uses primarily as part of mixed use development. I accept that the business and commercial uses are more concentrated, and intense, in the central part of Parramatta now zoned B3 than in the B1 zoned area where the property is located. I also accept that overall the area determined by the Council to be a centre of activity is diverse rather than homogeneous. I am satisfied, however, that there is a centre of business and commercial activity that consists of a core, middle and fringe, and that the subject property is located in the fringe part of that centre of activity. While it may be that other properties not included in the Ordinary Rates Map might equally be regarded as being within that centre of activity, that is not the issue in these proceedings. Neither is the issue of whether or not the Council undertakes what might be regarded as an equitable distribution of infrastructure or other service delivery from the revenue derived from the rates.

106 I am satisfied that there are reasonable grounds for believing that the property is not within the Business General sub-category, and that it can properly be regarded as being within the Business CBD sub-category. On that basis, the appeal against the refusal to change the rating sub-category applying to the property from Business CBD to Business General should be dismissed.

[emphasis added]

APPEAL GROUND 1

68 The first ground of appeal is that the Commissioner erred in law in that although she correctly identified the s 525(3) test as "whether there are reasonable grounds to conclude that the Property is not within the Business General sub-category" (at [58]), she failed to apply that test and instead asked the converse question whether there were reasonable grounds to believe that the property was not within the Business CBD rating sub-category.

69 In summary, Barrak submits:

(a) Section 525(3) of the LGA required, as a primary task, a focus on land sub-categorised Business General, not on the characteristics of land sub-categorised Business CBD.

(b) The Commissioner erred by in fact looking for similarities between the Property and other properties in the Business CBD rating sub-category centre of activity, rather than similarities or differences between the Property and other properties not in the Business CBD rating sub-category centre of activity. In other words, so the submission goes, the Commissioner was obliged to "focus" upon the characteristics of the latter properties and to determine whether there were reasonable grounds to conclude that the Property was different.

(c) A check on that process might well involve asking the question the Commissioner asked, but that could not be done at the expense of the correct exercise.

(d) Thus, the Commissioner should have asked why was the Property not rated Business General the same as other restaurants and small businesses on the other side of Wigram Street in Harris Park? And why was the Property not rated the same as almost all B1 zoned land in the local government area? The Commissioner eschewed the first question at [88] and did not ask the second. Had the Commissioner asked the second question, she would have seen that all B1 zoned land elsewhere in the Parramatta local government area, except the Property and adjacent properties within the Harris Park precinct, were in the Business General rating sub-category. The problem becomes stark at [88] where the Commissioner identified some lots on the northern side of Marion Street as anomalous that were zoned B1 but rated Business General.

(e) The Commissioner at [79]-[99] dealt with all the factors advanced by Barrak as to why the Property was distinguishable from the land in the remainder of the area sub-categorised Business CBD. However, they could only be a check on the main question.

(f) Consequently, "relevant facts were ignored" and "legally inappropriate weight" given to facts and submissions relevant to the converse question to the statutory question.

70 The essence of Barrak's submissions on Ground 1 is that the Commissioner erred by asking whether there were reasonable grounds to believe that the Property was within the Business CBD rating sub-category rather than whether there were reasonable grounds to believe that the Property was not within the Business General rating sub-category. It is said that the "focus" should have been on comparing the Property to other properties within the latter sub-category rather than the former.

71 In my opinion, the Commissioner did not err in law for the following reasons, generally along the lines submitted by the Council.

72 First, as the Commissioner observed at [34], [38] and [40] of her judgment, the Business General rating sub-category is, and for many years has been, a residual sub-category. It is that which is left over within the business rating category after the other specific business rating sub-categories are taken out. Therefore, the issue resolved to whether the Property was within the Business CBD rating sub-category since that was the only other specific business rating sub-category put forward by the parties as being potentially applicable.

73 Secondly, the test to be applied found in s 525(3) of the LGA is that: "The council must declare the land to be within the category nominated in the application unless it has reasonable grounds for believing that the land is not within that category" (emphasis added). The Property was sub-categorised Business CBD and Barak's nominated rating sub-category in its application to the Council was Business General. The Council refused the application for the stated reasons that the Property was well inside the Business CBD rating sub-category area and the dominant use of the Property remains for the purpose of business. If the Property was not within one of those two rating sub-categories, it was necessarily within the other. Logically, if there were "reasonable grounds" for believing that the Property was not within the Business General rating sub-category, it could only be because there were reasonable grounds for believing that it was within the Business CBD rating sub-category. Neither party identified any other basis for believing that the Property was not within the Business General rating sub-category. The supposedly different questions relied upon by Barrak are, in context, the same question: whether there are reasonable grounds to believe that the Property was not within the Business General rating sub-category depends on whether there are reasonable grounds to believe that it was within the Business CBD rating sub-category.

74 Thirdly, both parties' submissions to the Commissioner adopted that logical approach. The thrust of Barrak's submissions to the Commissioner was that the Property and the area in which it is situated are distinct from the rest of the area over which the Business CBD rating sub-category is imposed. For instance, consider Barrak's submissions to the Commissioner that:

(a) "The question that arises...is whether the property forms part of a business centre of concentration of activities that could relevantly be described as 'Business-CBD'. It is submitted that on many objective levels, it [does] not" (written submissions at [21]);

(b) "On the basis of the objective evidence, there is no basis on which the Council could have concluded that the subject property is appropriately categorised as a centre of activity described as 'Business- CBD'. In particular:

(i) The zoning of the land is not consistent with a Central Business District;

(ii) the property is located in Harris Park, not the Parramatta CBD;

(iii) the observable characteristics of the property and its surrounds...are distinguishable from land [within the CBD];

(iv) the Council has by its own actions taken steps to indicate that the land is not within the CBD..." (written submissions at [45]).

(c) "[I]n order to find that there is reasonable grounds for believing that the land is not within that category [Business General], one has to find another category. One has to say, "Well, what other category is it in?... it's not a vacuum. You can't just say, "Oh, it could be any of the other categories, and therefore it could be anything, and therefore I am not going to turn my mind to any of those categories. You have to look at those categories...in order to answer the question whether there are reasonable grounds for believing that the land is not within that category...one has to look at the other categories asserted, or the other possible categories, and one has to really ask the question are there reasonable grounds to believe that it's in any of those. There is no other way of doing it because otherwise we are just sitting here in a vacuum. There is nothing to go by" (oral submissions transcript 44-45).

75 The Commissioner could hardly have made an error of law by engaging with Barrak's submissions and the issue as framed by the parties and thus considering whether there were reasonable grounds to believe that the Property was within the Business CBD sub-category.

76 Fourthly, even if the Commissioner had to ask "why not Business General?" (and not its logical antecedent, "why Business CBD?"), the Commissioner did in fact ask that question: at [58]. She concluded that she was satisfied that there are reasonable grounds for believing that the Property is "not within the Business General sub-category": at [106]. Barrak submits that notwithstanding that the Commissioner correctly stated the test under s 525(3), she did not "focus" on comparing the Property with other properties in the Business General rating sub-category. To the extent that Barrak made submissions to the Commissioner on that issue, they were set out and considered by the Commissioner. The Commissioner considered Barrak's submission that there were other properties in Wigram Street also used as restaurants, which continue to be rated in the Business General sub-category and which operated in a commercially competitive environment with the Property, as well as its submission that there was "simply no rational basis to treat this property differently to other restaurants and business uses in Wigram Street and surrounding Harris Park area": at [43]. The Commissioner considered Barrak's submission that: "There are many restaurants in Wigram Street that are no different to the subject site, have the same zoning and are rated Business General. There is a cohesion to Harris Park, but it is not in common with the CBD": at [101(2)].

77 The Commissioner focussed on and made a direct factual comparison of the characteristics of the Property with the characteristics of nearby properties that were rated Business General. She directly compared the Property with the R2 Low Density Residential zoned properties used for restaurants and small businesses with a Business General rating on the other side of Wigram Street, and concluded that the Property's zoning without heritage constraints incorporated a higher development potential than those R2 properties with heritage constraints: at [87], [104].

78 The Commissioner compared the Property with some lots on the northern side of Marion Street zoned B1 Neighbourhood Centre (like the Property) but rated Business General, concluded that they might be anomalous, but observed that whether or not they could be regarded as being in the relevant rating centre of activity was not the issue: at [88] and penultimate sentence of [105]. Barrak submits that except for the Commissioner's alleged wrong "focus", she would have seen that these Marion Street lots were not anomalous at all. I do not accept the submission. It was open to the Commissioner on the facts to say what she did about these lots. In any event, it does not disclose any error of law. Barrak submits orally that the Commissioner was obliged, first, to assume that the rating of these Marion Street lots was sub-categorised correctly; and, secondly, to explain why the Property should not be sub-categorised in the same way. When taxed with the fact that other properties used for similar purposes as the Property in the Commissioner's fringe area were also within the Business CBD rating sub-category, Barrak submitted that the Commissioner did not have to assume that they were also rated correctly. Those submissions appear inconsistent and, in any case, are unpersuasive.

79 The Commissioner also focussed on other factors that Barrak said supported the Business General rating sub-category for the Property: at [8], [79], [89]-[99], [101]-[102]. They included the low scale built form in Harris Park said by Barrak to distinguish it from the CBD (at [91], rejected at [102]); the removal of parking meters and changes to parking controls in the area of the Property (rejected at [92]-[93]; Council's resolution to review the rating categories for all of Harris Park (rejected at [95]-[96]); and fairness in the context of owners of other properties with similar uses in the Business General rating sub-category paying much lower rates (described as having a limited role at [98]).

80 Barrak submits that the Commissioner should have focussed on land outside Harris Park said to be zoned B1 and rated Business General. I do not accept the submission. First, the zoning of land outside Harris Park was not in evidence. Secondly, it is unlikely that a comparison with such lands would be helpful as they are spread all over the Parramatta local government area. In contrast, the great bulk of the land in Harris Park zoned B1 was rated Business CBD. Thirdly, the point was not clearly put to the Commissioner. Barrak made no more than a fleeting reference to this topic in oral submissions to the Commissioner and then only by reference to two shopping centres miles away from the CBD (and which, according to that submission, were zoned B2). Fourthly, why would those shopping centres matter? They are in patches of land miles away from the CBD and the centre of activity for the Business CBD rating sub-category. The Commissioner was not under an obligation to record every submission, but only those of importance. The thrust of Barrak's case was that the Property was not part of the Business CBD rating sub-category, which was squarely addressed.

81 In my opinion, Ground 1 should be rejected.

APPEAL GROUND 2

82 The second ground of appeal is expressed as follows:

The Commissioner erred in law by misdirecting herself, and/or defining other than in accordance with law, the relevant test for determining whether there were reasonable grounds to conclude that the land was not within the "Business-General" sub-category by considering whether any particular consideration was determinative of the question rather than considering the factors as a whole:

Particulars

(a) The Commissioner was required to undertake a polycentric decision making exercise.

(b) Each of the matters considered at [78] - [99] and [100] - [102] was considered in a compartmentalised way as if each was a separate head of consideration which if answered in one particular way would necessarily result in a certain outcome.

(c) None of the factors was necessarily determinative, but rather the task of the Commissioner was to consider those factors, amongst others, as a whole by weighing and balancing the considerations (c.f. paragraph [83], [102] in particular).

(d) The Commissioner failed to determine the appeal by balancing all of the relevant factors, rather she rejected each one by one as if satisfaction of each was determinative of the outcome.

83 The Commissioner in the paragraphs of her judgment referred to in the particulars addressed the submissions of the parties as to whether there is an area that can properly be regarded as being a "centre of activity", in which the Property is located.

84 Barrak accepts that the Commissioner took into account all of the factors it advanced, but submits that this should have been done in a different manner described as "polycentric". Barrak cites the approach to polycentric decision-making addressed in Bulga Milbrodale Progress Association Inc v Minister for Planning and Infrastructure and Warkworth Mining Ltd [2013] NSWLEC 48, (2013) 194 LGERA 347 at [31]-[41]. In that case Preston CJ of LEC addressed the exercise of a statutory power to approve or disapprove a project under s 75J in Part 3A of the Environmental Planning and Assessment Act. His Honour said that this involved consideration, weighting and balancing of the environmental, social and economic impacts of the project; and that the range of interests affected, and the complexity and interdependence of the issues, meant that the decision-making involves a polycentric problem: at [31]. His Honour said, at [32]:

Polycentric problems cannot be resolved by identifying each issue at the start then sequentially resolving each of the originally identified issues. In a polycentric problem, the resolution of one issue will have repercussions on the other issues; the other issues may change in nature and scope depending on how the first issue is resolved.

85 His Honour concluded that the process of decision-making under s 75J therefore involves four steps: first, identification of the relevant matters needed to be considered; secondly, fact finding for each relevant matter; thirdly, determining how much weight each relevant matter is to receive; and fourthly, balancing the weighted matters to arrive at a managerial decision: at [36] and following.

86 On appeal to the Court of Appeal, Warkworth argued that his Honour's use of the concept of polycentricity to explain the nature of the decision-making process under s 75J involved a denial of procedural fairness, that the problem before the Court was binary not polycentric, and that the concept was otherwise incorrectly applied to reject expert evidence. The Court of Appeal rejected these arguments on the ground (among others) that the interdependence of various issues was intrinsic to the Court's exercise: Warkworth Mining Limited v Bulga Milbrodale Progress Association Inc [2014] NSWCA 105, (2014) 200 LGERA 375 at [168]. For the most part, the primary judge had used the concept of polycentricity as a catch-phrase to describe the multifaceted nature of the issues to be determined: at [171].

87 Barrak's criticism is that the Commissioner failed to "synthesise" the matters advanced by the Council in support of the proposition that the Property was not within the Business General rating sub-category with all of the relevant factors (such as Barrak's zoning consideration that the Property had more in common for rating purposes with other B1 zoned land, and geographic connection between the Property and the balance of the CBD). Rather, Barrak submits, the Commissioner appeared to consider each factor separately from the other, reject each one and then move on to the next - before finally accepting the Council's ground that a centre of activity consisted of a core, middle and fringe and may have diverse rather than homogenous characteristics.

88 No case is cited where consideration of factors "one by one" rather than "synthesising" them has been found to amount to an error of law. Bulga does not assist because there is no discussion there of such an error of law; and the nature of the merits decision to be made in that case (project approval for a coal mine under Part 3A of the Environmental Planning and Assessment Act) is entirely different to the decision called for by ss 525-526 of the LGA.

89 In any event, when the Commissioner's reasons are read as a whole, it is apparent that she did consider the combined weight of the factors advanced by Barrak, and did weigh or balance the various factors raised by the parties. For instance, the Commissioner noted Barrak's position that "when regard is had to the changes in planning controls since [1995], and other factors such as changes in parking controls, there are not reasonable grounds for believing that the property is within the centre of activity that is CBD..."; and she proceeded to refer to the "other factors": at [8]. Barrak complains that the factors of zoning and geographic connection with the CBD were not considered cumulatively. But the Commissioner did not find that these matters should not be given any weight. In expressing her overall findings, the Commissioner said that there were "a number of factors that establish that there is a centre of activity as shown on [a] map, and that the property is appropriately included within it": at [104]. The Commissioner went on to consider, among other factors, zoning and geographical connection with the CBD.

90 In my opinion, Ground 2 should be rejected.

APPEAL GROUND 3

91 The third ground of appeal is in the following terms:

The Commissioner erred in law in concluding that a "centre of activity" could comprise a "central core, surrounding commercial area and fringe" and that land within a fringe area forms part of the "centre of activity" (paragraph [86] and [105]:

Particulars

(a) The term "centre of activity" necessarily requires, as the Commissioner found at [77], that any particular property falls within what could be described as a concentration of activity so as to create a centre.

(b) Having found, as a fact at [105], that the property the subject of the appeal lay in an area that was not as concentrated as the land zoned B3 within the centre of activity, the property could not be regarded as part of the centre of activity.

92 Barrak's submission, as refined in reply and orally, goes to the meaning of the expression "centre of activity" in s 529(2)(d) of the LGA. The submission is that even if it was appropriate (despite Barrak's submissions on appeal Ground 1) to focus upon the centre of activity for the Business CBD rating sub-category, the Commissioner erred in concluding that the centre of activity could include a fringe area (in which the Commissioner found that the Property was located). Barrak develops its submission by:

(a) observing that the note to s 529(2)(d) says in relation to the category "Business" that a centre of activity "might comprise a business centre, industrial estate or some other concentration of like activities"; and

(b) submitting that as the Commissioner found that the area in which the Property was located was less intense (concentrated) than the B3 zoned land to the north, it follows that it was not in the centre of activity.

93 On the meaning of "centre of activity", two of the propositions that the Commissioner accepted with the agreement of both parties were, at [70(4) and (5)]:

A centre of activity will normally involve "a concentration of activities" within a particular area or around a particular site: Marrickville Metro (Pain J) at [46]; Marrickville Metro (CA) at [79]). While the word "centre" requires some kind of geographical connection between activities carried out on the parcels of rateable land within the sub-category, the connection need not be of any particular kind (it can be large or small, depending on how the council defines it);

A centre of activity may be tightly compressed and homogenous (for instance, the 100 tenancies in Marrickville Metro, all of which were retail premises and on one lot) or more diverse, for example the more loosely described centre of activity in Ranglen which encompassed a variety of land uses and different geographical areas on each side of The Horsley Drive.

94 The notion of a "more diverse" centre of activity carries with it the possibility of a core and activities radiating out from the core. In Ranglen Investments Pty Ltd v Fairfield City Council [1996] NSWLEC 192, a rating sub-category was determined by Fairfield City Council and described as "Fairfield Business Centre". The applicant was the owner of land on which various activities were carried out (clothing manufacture, car repairs, printing, furniture storage, furnish or repair and retail, mobile phone retail and a café). The applicant appealed from the inclusion of the land in that sub-category under s 526 of the LGA. Bannon J dismissed the appeal. His Honour found that the sub-category encompassed a diversity of land uses (both retail and industrial) over a relatively large geographical area, and that the applicant's land could reasonably be said to be part of it.

95 In my opinion, Barrak's submission unduly narrows the meaning of the word "concentration" in the note to s 529(2)(d), which is not expressed in exhaustive terms. Its use of the word "concentration" by reference to business centre or industrial estate, or the like, is for the purpose of categorisation. In my view, depending on the facts, a centre of activity for a category or sub-category may comprise areas of varying intensity which radiate out and which may answer to the descriptions core, middle and fringe. In a sense, the core represents a paradigm and the characteristics deteriorate as one moves away from the core. Determination of a centre of activity in this context requires an evaluation of the facts, which the Commissioner carried out including by way of a view of the area. In my opinion, there was no error of law in the Commissioner's analysis.

96 Barrak alternatively submits that if there be a core, middle and fringe to the Business CBD rating sub-category, then the fringe is the City Edge in the SREP 28 zoning map for the City Centre Precinct - which the Property is outside. Barrak in effect asks rhetorically: if there be a fringe, where do you draw the line? The answer is that it is a matter for factual evaluation, which the Commissioner carried out, and is not open to review on this appeal, which is limited to questions of law.

97 In my opinion, Ground 3 should be rejected.

APPEAL GROUND 4

98 The fourth appeal ground is not pressed.

APPEAL GROUND 5

99 The fifth appeal ground is in the following terms:

The Commissioner further erred in law in considering, despite and contrary to the findings cited in ground 4, that the fact that the property retained a business zoning was relevant in determining that the property was within a centre of activity (paragraphs [82], [86], [104]) where, by reason of the statutory formulation in s 529(2)(d), a business zoning (simpliciter) could not assist in determining whether the property was within a "centre of activity".

100 Ground 5 is clarified to some extent in Barrak's submission in reply that "despite the Commissioner having earlier accepted the Council's submissions that there was no basis for the suggestion that rating categories should reflect the zoning in any respect (at [83]), in her conclusion at paragraph [104] the Commissioner took into account the business zoning of the [Property] in order to conclude that by reason of its continued business zoning that there were reasonable grounds to conclude on that basis that the Property was not within the Business General sub-category". Barrak submits that this was a legal error because the business zoning of land would not, of itself, be sufficient to determine that the land was within a centre of activity.

101 The submission misreads the Commissioner's reasons. The Commissioner found that the rating boundary would "not necessarily" reflect the zoning boundary, but that zoning was something that could be taken into account in deciding whether a "centre of activity" existed: at [83]. There was no legal error in the Commissioner's reasoning that the distinction between the business zoning of the Property and the residential zoning of areas outside the rating sub-category boundary provided some justification for where the Council had chosen to draw the line. Further, this was not the only matter the Commissioner took into account in making an evaluative judgment as to the centre of activity. The Commissioner referred to a number of matters, including land use (predominantly business or mixed use rather than solely residential use) and geography (proximity to the centre of the Parramatta CBD): at [102], [104] and [105].

102 In my opinion, Ground 5 should be rejected.

APPEAL GROUND 6

103 The sixth appeal ground, insofar as it was pressed at the hearing, is as follows:

The Commissioner erred in law in failing to cite or consider relevant evidence central to the question that she had set for herself, namely:

(a) evidence that all land zoned B1 Neighbourhood Business in the Respondent's local government area (except the B1 land in Harris Park) was rated Business-General;

(b) evidence that the parking meters had been removed in the locality due to lack of demand for paid parking.

104 Barrak invokes the principle that while the Commissioner was not under an obligation to set out every aspect of the evidence, "where evidence is important or critical to the proper determination of the matter and it is not referred to by the trial judge, an appellate court may infer that the Commissioner overlooked the evidence or failed to give consideration to it: Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430 at 443; applied in Greenwood v Warringah Council [2013] NSWLEC 223, (2013) 200 LGERA 190 at [23]. Barrak submits that the evidence referred to above in Ground 3 is of that kind.

105 An important qualification in Beale is that "there is no need to refer to the relevant evidence in detail, especially in circumstances where it is clear that the evidence has been considered": at 443.

106 Ground 6(a) overlaps with Ground 1 and I have dealt with it above at [ REF _Ref403668492 \r \h 68]-[ REF _Ref403668501 \r \h 81].

107 As for Ground 6(b), the Commissioner dealt with the issue of parking in her reasons: at [8]-[9], [92]-[93], [100(5)], [101(5)].

108 In my opinion, Ground 6 should be rejected.

ORDERS

109 The appeal is dismissed with costs. The exhibits may be returned.

ANNEXURES

"A" Locality map showing the location of the Property

 

"B" Magnified extract of Council's 2013 "Ordinary Rates" map, on which zoning boundaries and the Business CBD rating sub-category boundary are superimposed

 

ANNEXURE A

ANNEXURE B

 

 

Amendments

24 November 2014 - Typographical corrections
Amended paragraphs: [6], [7], [86], [101], coversheet

Decision last updated: 24 November 2014