In this blog, Claire Parsons of CBP Lawyers explains the importance of clarity in a development consent, and how ambiguity can adversely impact on the commercial value of the consent.
If the terms of a development consent are unclear or ambiguous, a government authority or the Court on appeal may take into account reference material which is not identified in the development consent itself. This can have significant impacts on the commercial value of the consent.
Consent granted for a quarry
In 1979 a development consent was granted by Cessnock City Council for a quarry and associated infrastructure at a property at Allandale, NSW. The consent provided no conditions defining the precise size and location of the quarry within the confines of the property, although it did provide detailed conditions regulating the operation and construction of the quarry and the associated buildings and infrastructure.
Accompanying the original development application was a letter with further details – specifically, that the proposed maximum area for quarrying activities would be 40 hectares “as indicated in the diagram”. The accompanying diagram contained a circle, with a notation stating a proposed quarrying area of 40 hectares.
Compulsory acquisition of the property by NSW Roads and Maritime Services
The NSW Roads and Maritime Services (RMS) subsequently acquired the property via compulsory acquisition. The applicants – the dispossessed land owner and the lessee – argued for a property valuation based on an entitlement to relatively unlimited quarrying activities. RMS argued for a valuation based on quarrying activities limited to 40 hectares.
Should the development consent be considered on its own?
The primary issue for the Court in Quarry Products (Newcastle) Pty Limited and Allandale Blue Metal Pty Limited v Roads & Maritime Services (No.3)  NSWLEC 57 was whether, in the absence of specific conditions dealing with scale, geographic location and volumetric limits of the quarry, it was possible to be guided by the documents accompanying the original development application, lodged 33 years earlier.
The applicants argued that the consent was complete and must be read and interpreted on its face. RMS argued that it was not possible to understand what development was approved by the terms of the consent alone and that it was necessary to consider the development application documents.
Decision of the Land and Environment Court
The decision may be summarised as follows:
- When determining what has been approved, you primarily interpret the document constituting the approval. If the terms of the consent are clear, you may not look at extraneous documents to qualify or contradict the consent.
- Where a development consent incorporates the development application or other documents expressly or by necessary implication, these documents may be relied upon to interpret the consent. This reliance extends only to the extent that these documents are actually incorporated into the consent.
- The express incorporation of extraneous documents into a consent requires more than mere passing reference, but instead the use of words that would inform a "reasonable reader" that the other documents form part of the consent.
- The incorporation of extraneous documents by way of "necessary implication" arises where the terms of the consent are not clear and are ambiguous.
Development consent could not be interpreted on its own
The Court found that the consent could not properly be construed alone, as it did not include "necessary and important details", such as the size and location of the quarry. These details were contained in the original development application documents, specifically the letter and the indicative plan. The Court was satisfied that these documents were incorporated into the consent expressly (by virtue of the planning regime at the time) and also by "necessary implication" in order to rectify the ambiguity.
Implications of the Quarry Products decision
This decision raises two important issues. First, a development consent which is unclear or ambiguous in its terms or scope will not necessarily be construed liberally or expansively to the benefit of the landowner by government authorities or the Court on appeal.
Secondly, if there is any uncertainty in the terms of a development consent, it is necessary to consider the source material on which the consent was granted, irrespective of how many years the consent has been operational.
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