Whose objection is it anyway? New local resident group can inherit right to challenge development consent on its merits

By Brendan Bateman, John Clayton and Elle Matsoukas

26 Oct 2017

The case highlights the fact that objections made by unincorporated bodies may give rise to rights of appeal by subsequently incorporated associations.

Under NSW planning law, any person can challenge the lawfulness of a development consent on the basis that there has been legal error in the grant of that consent, but usually only an applicant for development can appeal against a decision to grant or refuse consent on the merits.

One exception to this is where a development application relates to certain types of significant development that require an environmental impact statement. These types of development are categorised as "designated development". In these circumstances, the law allows any person who lodged an objection to the development application, that is an "objector", to appeal the merits of the decision to grant development consent. In practice, this can often be a residents group or other initially informal grouping.

The NSW Court of Appeal has shown how this exception to the rule works in practice, especially as the nature of the group making the objection evolves, in Qube Holdings Ltd v Residents Against Intermodal Development Moorebank Inc [2017] NSWCA 250.

Objector's right to appeal

Before the Court of Appeal was a challenge to the standing of a local residents action group, Residents Against Intermodal Development Moorebank Inc (RAIDM Inc) to appeal on the merits against the development consent for the proposed Stage 1 of the Moorebank Intermodal terminal.

Stage 1 of the Moorebank Intermodal terminal was classified as designated development. Qube had lodged a development application for Stage 1 of that project. As part of the statutory public consultation for the development, RAID Moorebank, a local interest group, made a submission objecting to Qube's development application, and thus became an "objector" within the definition of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act).

After making the submission, RAID Moorebank was statutorily incorporated, forming RAIDM Inc. Subsequently, the Planning Assessment Commission (PAC) granted development consent to Stage 1.

Because of the incorporation, it was RAIDM Inc which appealed against the grant of consent to the Land and Environment Court, rather than the entity which had made the objection.

A key threshold issue was whether RAIDM Inc, who was not the person who had lodged the objection, was nevertheless entitled to bring the appeal. Qube sought to argue, as an interlocutory matter, that RAIDM Inc did not have standing to bring the appeal. Chief Justice Preston in the Land and Environment Court dismissed Qube's application, finding that RAIDM Inc was relevantly an "objector", and Qube sought leave to appeal on this question to the Court of Appeal.

Transferring an objector's right to appeal

There was no dispute that RAID Moorebank had made an objection and was entitled to appeal on the merits, and that RAIDM Inc had not. At issue, therefore, was whether RAIDM Inc had succeeded to RAID Moorebank's rights upon incorporation.

This involves a consideration of the Associations Incorporation Act 2009 (NSW) (AI Act). Under Schedule 2 of the AI Act, where an "unincorporated body" is incorporated, the new body succeeds to all of the assets, rights and liabilities which were held by the "unincorporated body". One of the rights held by RAID Moorebank was a right of merits appeal in respect of the Stage 1 consent granted by the PAC. The question, therefore, was whether RAID Moorebank was an "unincorporated body" under the AI Act.

Qube argued that RAID Moorebank was not an "unincorporated body" as described in Schedule 2 of the AI Act because it lacked the necessary structure and numerous characteristics of an unincorporated body, including a constitution or set of rules making provision for membership and voting, and a list of members. Qube pointed to the fact that the AI Act required members of an unincorporated body to pass a "special resolution" to approve incorporation necessarily required a degree of structure and governance rules which RAID Moorebank did not.

RAIDM Inc argued that RAID Moorebank did not need to meet the demanding characteristics that Qube contended were necessary in order for RAID Moorebank to be an unincorporated body because the essence of an association has been loosely described to involve a group of people with a common purpose and continuity. The requirement for a "special resolution" for incorporation in the AI Act did not take on the defined meaning of that term that applied to the rules that governed associations that were already incorporated. RAIDM Inc further contended the registration and certificate of registration as an incorporated association under the AI Act was conclusive proof that RAID Moorebank was an unincorporated body that had been incorporated.

The Court of Appeal accepted the diverse spectrum of structures that unincorporated associations take, noting from other cases, the range from loosely to highly organised groupings that involve some form of combination of persons with a common degree of organisation and continuity. The Court viewed RAID Moorebank as falling within this spectrum of unincorporated associations and took the view that the "courts should be slow to find that the adoption of any particular formalities is essential to the existence of an unincorporated body or association".

Is this a collateral challenge?

Chief Justice Preston had also found at first instance that Qube's application involved an impermissible attack on the validity of the registration of RAIDM Inc. Qube denied that its application involved such a collateral challenge.

The Court of Appeal agreed with Qube on this point, finding that Qube's argument did not depend on or require a conclusion that the Secretary's decision to register RAIDM Inc, or the act of registration, was of no legal effect. In any event, the majority of the Court of Appeal expressed the opinion that even if there had been some defect in RAID Moorebank's application for incorporation, the AI Act did not indicate an intention that non-compliance with the application requirements would invalidate a registration which had been accepted by the Secretary.

What's next for Moorebank - and objectors?

After consideration, the Court of Appeal confirmed that RAIDM Inc had succeeded the rights of RAID Moorebank and was therefore an "objector" with standing to bring the merits review proceedings in the Land and Environment Court. Although the Court of Appeal granted Qube leave to appeal the interlocutory decision, it ultimately dismissed Qube's appeal.

The hearing of the proceedings in the Land and Environment Court brought by RAIDM Inc against the Stage 1 consent is listed for hearing on 25-27 October 2017.

So that's what this means for the Moorebank project. More broadly, the case highlights the fact that objections made by unincorporated bodies may give rise to rights of appeal by subsequently incorporated associations. This is a continual issue as objector groups often start off as small, informal groupings, but can evolve over time into more formal and even incorporated bodies. For developers on the other side, it should give some certainty about who has standing to object.

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