Upcoming Mallesons seminarsConstruction industry participants.
What do you need to do?Review how the issues and developments in our publication impact your business. Consider how your business transactions will be affected. We can help.
Geoff Wood
Partner
Sydney
Barry Casey
Mark Darian-Smith
Peter Pether
Adam Wallwork
Julie Wright
Andrew Chew
Melbourne
James Forrest
Peter Megens
Perth
Simon Lee
Brisbane
Scott Budd
Canberra
John Topfer
Chris Wheeler
Background
The proposal to construct the CBD Metro will result (and has already resulted) in a number of changes to planning and infrastructure development laws which will have a significant impact upon development within the vicinity of the proposed metro corridor. This article sets out some of the changes to date.
On 16 February 2009, Sydney Metro lodged with the Department of Planning a Preliminary Environmental Assessment (“PEA”) pursuant to section 75E of the Environmental Planning and Assessment Act 1979 (NSW) (EP&A Act) for the 7km underground metro railway (CBD Metro) from Rozelle to Central, estimated to cost $4.4 billion.
The project envisages new stations at Rozelle, Pyrmont, Barangaroo-Wynard, Town Hall Square and Central. A further station may be built at White Bay in the future. It is intended that construction will commence in 2010 with the entire metro operational by the end of 2015.
The PEA broadly sets out the environmental impacts arising from the project and identifies mitigation strategies to be further considered.
As the name implies the PEA is a broad brush document. Very little detail is given in respect of some significant issues (for example, depth of the proposed tunnels, impact on heritage items, management of contaminated spoil and land, waste disposal). A more detailed environmental assessment is to be completed once the Department has issued the Director-General’s requirements for the project. The PEA does, however, give some useful indications as to the overall concept and extent of the project. Click here to view the PEA.
Sydney Metro Authority
A new Sydney Metro Authority has been established under the Transport Administration Act 1988 (NSW) to oversee the development and operation of the CBD Metro system and to co-ordinate the future linkage of that system to other areas of Sydney. The Sydney Metro Authority is vested with a comprehensive array of powers including, relevantly:
- the power to carry out development or facilitate, manage or finance development on land located on or in the vicinity of metro rail systems
- the power to enter into contracts and other arrangements for the development, management, control, maintenance and operation of metro rail systems
- the power to develop station plans, and
- the power to acquire land in accordance with the Land Acquisition (Just Terms Compensation) Act 1991 (NSW).
Planning Considerations
The CBD Metro project has been declared to be both critical infrastructure and a project to which Part 3A of the EP&A Act applies. As a consequence, special features of Part 3A apply which make it easier and faster to obtain approval for the project. These include:
- EPIs (including SEPPs) do not apply to the carrying out of the project unless a SEPP expressly relates to the project.
- Neither the proponent nor any objector has the right to appeal the Minister’s determination on the merits.
- Only the Minister can institute enforcement proceedings.
- There are limited requirements for the certification of construction and subdivision work.
- The application of environmental legislation which would normally apply to a project (for example the Heritage Act ) is limited.
Amendments to the State Environmental Planning Policy (Infrastructure) 2007 (“the Infrastructure SEPP”) came into effect on Friday, 20 February 2009. These changes impact significantly on proposed development in and around the CBD Metro corridor (presently defined in the legislation as the “Interim Metro Corridor”). Click here to view the Infrastructure SEPP.
New clause 88A applies to land within the City of Sydney that is within the Interim Metro Corridor. Under this clause the Council is required to forward the details of any major development application to Sydney Metro and must not grant consent to any development if the development would have an adverse effect on the viability of the proposed metro, including increasing the likely cost of developing the proposed metro. Although the clause expressly relates to land “within” the Interim Metro Corridor, there is no indication of how widely this term will be construed. It is feasible that it will be defined to include land within the vicinity of the Interim Metro Corridor.
For the purpose of determining whether development would have an adverse effect on the viability of the proposed metro, the Council may rely on a certificate issued by Sydney Metro that certifies whether there would be such an adverse effect. The certificate will not be binding on the consent authority but is likely to be persuasive in the authority’s determination.
Clause 88B applies to land in and adjacent to all the proposed CBD metro stations and is drafted in similar terms to clause 88A. A consent authority must not grant consent to development on such land unless it has taken into consideration whether the proposed development will adversely affect the development and operation of the proposed metro station (including access to and egress from the station) and whether the development will encourage the use of public transport.
Clause 88C applies specifically to proposed development in and adjacent to the proposed Rozelle metro station. The relevant consent authority must notify Sydney Metro of any such development and, in determining whether to grant consent to the development, the consent authority must take into account any submissions received by Sydney Metro within 21 days of giving such notice.
As with clause 88A, there is no indication of how widely the term “adjacent to” will be understood as it is used in clauses 88B and 88C. The term is sufficiently ambiguous to be given a potentially broad application.
Given the premium real estate that the corridor passes through and the significant basement development that may otherwise be possible on land within this area, these amendments are likely to have a significant impact on land value and the development potential of sites within the CBD.
The project timeline indicates that a detailed project assessment will be exhibited in the 4th quarter of 2009. It is to be hoped that by this time greater details of the project are available to enable meaningful community feedback and to enable property owners who may be affected by the proposal to have a better understanding of the likely impact on their land.
On 13 March 2009 the NSW State Government created the office of the NSW Infrastructure Co-ordinator General (Co-ordinator-General) and the Nation Building and Jobs Plan (State Infrastructure Delivery) Act 2009 (Nation Building Act) came into effect. The legislation is aimed at fast tracking new infrastructure development in NSW so as to meet the Federal Government's timeframe for spending its $42 billion economic stimulus package. The package includes a $29 billion boost to construction activity.
Mr Bob Leece has been appointed as the Co-ordinator-General. His key responsibilities will be to:-
- plan and oversee a programme for delivery of infrastructure projects within the timeframes required for Commonwealth funding as set out under the Nation Building and Jobs Plan
- advise on appropriate tendering and procurement procedures for the delivery of the projects within those timeframes, and
- carry out or coordinate State government agencies in delivering infrastructure projects.
A Taskforce (which will include the Co-ordinator-General, nominees of relevant government agencies and the private sector) has been established to assist the Co-ordinator-General by providing advice on the exercise of functions under the Nation Building Act.
Only projects which are either fully or partly funded by the Federal Government's Nation Building and Jobs Plan fall within the ambit of the Nation Building Act. Other Commonwealth funded projects are not (presently) caught. Development is to be taken to be funded by the Jobs Plan where the Co-ordinator-General certifies that the Commonwealth has determined that funds which have been appropriated under the Commonwealth Funding Acts will be allocated for the erection of buildings or the carrying out of works in connection with the development. Examples of such development are multi-purpose halls and libraries and other education works, social housing and community and local transport infrastructure such as road repairs, railway boom gates and road safety black spot projects.
The Premier or any other Minister with the concurrence of the Co-ordinator-General may authorise the Co-ordinator-General to be responsible for the carrying out of a State Infrastructure project. Further, in an effort to meet Federal funding requirements, the Nation Building Act provides a mechanism to allow environmental and other development control laws to be dispensed with. Importantly, under Part 5, the Co-ordinator-General may declare a specified infrastructure project or class of infrastructure projects to be exempt from all or any "development control legislation". This category of legislation is broadly defined to include the “Environmental Planning and Assessment Act”, or any other Act (such as the Protection of the Environment Operations Act 1997) that prohibits the carrying out of development or that requires the approval of a person or body before development is carried out. The definition extends to encompass several other pieces of environmental legislation which impose requirements for additional approvals to be obtained.
The Nation Building Act gives the Co-ordinator-General the power to self-approve projects over which he is responsible by declaring a project to be exempt from development control laws outright or issuing an authorisation (which in turn may, but need not, be subject to conditions) for the carrying out of a project if requested to do so by a person proposing to carry it out. Once issued, such an authorisation is taken to be a development consent under the EP&A Act. An authorisation or an exemption declaration is not open to challenge before the Courts or tribunals.
Although it is not apparent from the wording of the Nation Building Act, according to the Planning Minister’s 2nd reading speech, it remains the Government’s intention that the development assessment processes set out in the Infrastructure SEPP be used wherever possible. Recent amendments to the Infrastructure SEPP streamline the approvals processes for school infrastructure and affordable housing by providing for a series of categories of complying development.
Where such a project can be categorised as complying and can be delivered within the Commonwealth’s tight time frames, there will, in theory, be no need to use Part 5. Where a project does not meet the complying development requirements of the Infrastructure SEPP, it will be possible to apply to the Co-ordinator-General for an authorisation which avoids the need for any environmental assessment at all. Paradoxically, it is likely that projects in more dense urban areas will have difficulty in meeting the complying development controls. These projects are likely to have greater amenity and environmental impacts yet are the ones that are more likely to take advantage of the Part 5 exemption.
The creation of the Co-ordinator-General establishes yet another specialist infrastructure delivery organisation within NSW and reflects a general trend towards infrastructure management which is being encouraged at the Federal level. How it is intended to work with other specialist State infrastructure organisations, such as the Barangaroo Delivery Authority and the Sydney Metro Authority, remains to be seen. Interestingly, the powers given to the Co-ordinator-General go well beyond the powers and regulatory concessions granted to other specialist development facilitators in the past, notably, the Olympic Coordination Authority leading up to 2000. While many may argue that different economic times call for different approaches, the failure to undertake full environmental assessment and adequately involve the community may not only have unintended impacts resulting in loss and detriment to the environment but may also result in delay at later points in the project which causes significant management and operating issues.
Occupational Health and Safety
Employers’ duties extend to third party premises
The NSW Industrial Court has recently held that employers must ensure the health, safety and welfare of their employees not only at the employer’s place of work, but also at third party premises where the employer’s employees carry out work in the case of Inspector Patton v Western Freight Management Pty Limited [2008] NSWIRComm 217. Read more.
Security of Payment Legislation
Building and Construction Industry Security of Payment Bill 2009 (SA)
The Building and Construction Industry Security of Payment Bill 2009 was introduced as a private member's bill by Tom Kenyon into the South Australian House of Assembly. Read more.
Environmental planning
Amendments to the EP&A Act
The NSW Environmental Planning and Assessment Act has been amended to introduce a new stop work order. Read more.
Amendments to Contaminated Land Management Act
Significant amendments have been made to the NSW Contaminated Land Management Act. Read more.
Risk of inserting ‘Nil’ or ‘N/A’ in Annexure of Australian Standard Contracts - Silent Vector Pty Ltd t/as Sizer Builders v Squarcini [2008] WASC 246
Parties to building contracts should exercise caution when deleting, amending or adding clauses to contracts and do so in a clear and consistent manner. Read more.
Defective design: Roluke P/L v Lamaro Consultants
The NSW Court of Appeal has recently considered the correct measure of damages where the design of a building is discovered to be defective. Read more.
High Court speaks on breach of covenant against making alterations without landlord's consent
The High Court has decided an important case on the effect of a tenant’s breach of a covenant not to make alterations without the landlord’s prior consent. Read more.
When can unconditional undertakings be called ?
The NSW Supreme Court has recently considered whether contract conditions could affect the ability to call on an unconditional undertaking. Read more.
Serving payment claims via facsimile - risk of non-receipt Zebicon Pty Ltd v Remo Constructions Pty Ltd [2008] NSWSC 1408
Payment claims are not required to be submitted during office hours and service by facsimile may be effective even if the machine is malfunctioning. Read more.
Bills
Barangaroo Delivery Authority Bill 2009 (NSW)
Assented on 30 March 2009 - Act No 2 of 2009.
Building and Construction Industry Training Fund and Levy Collection Amendment Bill 2009 (WA)
Legislative Council Third Read 19 March 2009
Building and Construction Industry Security of Payment Bill 2009 (SA)
First reading 5 Mar 2009
Regulations
Construction Industry Portable Paid Long Service Leave Amendment Regulations 2008 (WA)
Notification 30 Dec 2008 Gazette 229, p 5642
Commences 30 Dec 2008 Regs 1 and 2; 1 January 2009 Remainder