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31 July 2017 A condition using the term "Applicant" can impose a restriction related to the identity of the user

By Cecilia Rose, Partner

A condition using the term "Applicant" can impose a restriction related to the identity of the user only – and may not "run with the land": Dravin Pty Ltd v Blacktown City Council [2017] NSWLEC 38

Why is Dravin important? 

We are probably all a bit lazy about throwing around phrases like "in rem" and "consents run with the land".  Dravin reminds us that a more careful examination of conditions of consent are required.

Purchasers and developers: Have you purchased land or developed land with the benefit of a development consent?  Do ALL the conditions apply in rem?  Are any personal?  Is the word "Applicant" used in the consent?  What does "Applicant" mean in the context of that consent?

Due diligence exercises: Are there any particular conditions that should be interpreted as personal, that will not transfer when a business or land is purchased?
 
Councils: The term "Applicant" in consents should be avoided – is it intended that "a person entitled to act on the consent" can utilise the condition, or the person who is the applicant for the development consent?  Over the counter enquiries about existing consents should be treated with care – a simple response that "consents run with the land" is not sufficient, or accurate.

Drafting conditions of consent: Be mindful in apportioning responsibility for compliance with a condition by the applicant. If the condition is intended to apply to future owners or beneficiaries of the consent, consider using the phrase "the beneficiary of the consent" "or "person who may act on the consent".

The Decision

Dravin appealed against the decision of Commissioner Brown, who refused the section 96 modification application on the basis that the proposal did not meet the two preconditions of section 96(1A): the proposal was not of minimal environmental impact, and it failed to demonstrate that the development would be substantially the same as the original consent.  His Honour Justice Preston, the Chief Judge, reviewed the Commissioner's reasons for refusal.  One of the Commissioner's findings was that "the Applicant" in condition 2.2(ii) was a reference personally, to Mr Hlebar, who was the Applicant for the original 1978 development consent.  Dravin, in the appeal alleged this was an erroneous construction of the word "Applicant".
 
Dravin submitted that "Applicant" in a consent means anyone who may act on the consent.  A development consent runs with the land and "is not personal to the applicant but enures for the benefit of subsequent owners and occupiers, and in some respects a consent is equivalent to a document of title" (Else-Mitchell J per Ryde Municipal Council v Royal Ryde Homes (1970) 19 LGRA 321 at 324, as extracted at [20]).  Condition 2.2(ii) was incorporated into the consent in deference to a letter from the Metropolitan Waste Disposal Authority, to whom the Applicant, Mr Hlebar, had applied.  Dravin argued "Applicant" in condition 2.2(ii) was the "owner" or "operator" [at 21]. 
 
The Council accepted that there is a general principle that a consent operates in rem.  However, that general principle "must operate subject to the express language of the consent" [23].  His Honour Justice Preston agreed with the Council's submissions, indicating that "A consent can lawfully impose restrictions related to the identity of the user." [27].  On close examination of the condition, Preston CJ observed the condition limited the waste that could be received to "Waste carried by the applicant in his own vehicles" [28], the limitation to "his vehicles" indicated a "limitation by reference to the identity of the person" [29].  Also important in this matter was that transporting waste is an activity that requires a licence.  A licence is personal, and does not operate in rem [30].  Preston CJ also observed the distinction between "use of land for the purpose of a waste disposal depot and the activity of transporting waste to that land.  A development consent attaches to the land on which the use for the purpose of waste disposal depot permitted by the consent is carried out……the consent does not attach to other land that is not the subject of the consent" [30].
 
Find the case here.

Cecilia Rose, Partner  |  Phone: +61 2 9233 5544  |  Email: cxr@swaab.com.au

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This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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