By Aaron Gadiel, Partner

A new Land and Environment Court decision now means that any subdivision of land that includes land identified as ‘coastal wetlands’ or ‘littoral rainforest’ will be ‘designated development’.

Development that is ‘designated development’ is required to undergo a more intensive development assessment process. It is subject to objector appeals/interventions in the Land and Environment Court.

Development applications for designated development must be accompanied by an environmental impact statement and be publicly exhibited for at least 28 days.  If development consent is granted by a consent authority, objectors have the right to commence a merit appeal in the Land and Environment Court. If a developer appeals a decision (or deemed refusal) of a development application for designated development, the objectors have a right to be heard in the appeal proceedings.

The designated development category is generally reserved for heavy industry and high impact activities (such as coal mines, chemical industrial facilities, quarries, marinas, etc).

In a decision handed down this month,  Investments NQ Pty Ltd v Tweed Shire Council [2024] NSWLEC 1108, the Court considered a development application to subdivide a vacant single lot into two lots. The development application also proposed to construct a new dwelling on each new lot.

The site had an area of 1,888m².  Part of the land, being 0.051m², was mapped as ‘littoral rainforest’ on the ‘Coastal Wetlands and Littoral Rainforests Area Map’ adopted by the State Environmental Planning Policy (Resilience and Hazards) 2021 (the Resilience and Hazards SEPP).  This mapped area accounted for just 0.003 per cent of the site area.

The proposed subdivision would not have divided this small area of ‘littoral rainforest’ land. It would have been located entirely within one of the two lots to be created.  No works, including landscaping works, were proposed over this land.

In the matter, all merit issues, including biodiversity issues, had been resolved.

However, the local council argued that development consent could not be granted for two legal reasons.

Firstly, the council argued that landowner’s consent had not been given. The Council was unsuccessful on this point and the Court accepted that landowner consent had been granted.

Secondly, and more significantly, the council argued that any subdivision of a lot that includes land mapped as ‘littoral rainforest’ on the ‘Coastal Wetlands and Littoral Rainforests Area Map’ (under the Resilience and Hazards SEPP) must be ‘designated development’.

The argument was based on section 2.7 of the Resilience and Hazards SEPP.  This provision says that any development (other than environmental protection works) that is carried out ‘on’ land identified as ‘coastal wetlands’ or ‘littoral rainforest’ in the ‘Coastal Wetlands and Littoral Rainforests Area Map’ is ‘designated development’.

The applicant argued that the proposed subdivision was not being carried out ‘on’ the ‘littoral rainforest’ land — as that land itself was not proposed to be divided.

The council argued that when a single lot is to be subdivided, the subdivision is carried out on all of the land that comprises the lot. It did not matter that the actual new lot boundary would not divide the ‘littoral rainforest’ land.

The Court accepted the Council’s argument.

This did not lead to a refusal of the development application. The Court accepted that it could still grant consent for the balance of the development (the erection of the dwelling houses and the associated civil works). However, the Court would not approve the subdivision (as an environmental impact statement had not been prepared and exhibited).

As a result of this decision, there may be an increase in designated development applications in areas as affected by coastal wetland and littoral rainforest mapping.

Applicants may need to consider the practicability of dividing development applications into two — one for civil works (which, if not carried out in the mapped area, would not be designed development) and a separate application for subdivision (which would be designated development, and subject to the requirement for an environmental impact statement).