Joinder Applications – Settlement a bar to joinder and the approach in Pitt now superseded?
The Supreme Court (the Court) last month delivered its judgement on the appeal from the ERD Court decision in 21-25 South Esplanade Pty Ltd v State Planning Commission [2022] SAERDC 4 (the ERD decision). Although the appellate decision concerns applications for joinder under the now repealed Development Act 1993 (Development Act), it has significant implications for future joinder applications under the Planning, Development and Infrastructure Act 2016 (PDI Act).
Background
The ERD decision was discussed in the March edition of Normans News and is available here.
These proceedings concerned an application by 21-25 South Esplanade Pty Ltd (21-25 South Esplanade) for a proposed Category 2 development in Glenelg. The originally proposed development was refused by SCAP.
21-25 South Esplanade appealed this decision to the Environment, Resources and Development Court (ERD Court) and submitted a revised proposal. SCAP indicated that it would settle the matter by accepting the revised proposal. However, prior to any settlement being recorded five property owners adjoining the site of the development and the Council (the Joinder Applicants) sought to be joined to the appeal.
The ERD decision and subsequent Supreme Court appeal concerned the power of the ERD Court to join the Joinder Applicants in circumstances where a settlement had been agreed between the parties.
Settlement a bar to joinder?
The Court found that the matter should have proceeded to conference at first instance and that the joinder applications should only have been considered if the matter was not settled at conference.
The Court further held that the ERD Court could only decline to record a settlement reached between the original parties at a conference for those reasons provided in section16(9) of the Environment, Resources and Development Court Act 1993 (ERD Court Act). That is, ‘[t]he member of the Court presiding at a conference—
- must not accept a settlement that appears to be inconsistent with a relevant Act …; and
- may decline to accept a settlement on the basis that the settlement may materially prejudice any person who was not represented at the conference but who has a direct or material interest in the matter.’
(underlining added)
It went on to find that only those persons entitled to be given notice of a decision in respect of a Category 3 development under section 38 of the Development Act were persons with a ‘direct or material interest’ for the purposes of section 16(9) of the ERD Court Act. The Court based this decision on the distinction it drew between:
- those persons with merely an interest in the effect of the development on the amenity of nearby premises (Category 2 representors); and
- those persons with a procedural right, i.e. to appeal the decision, which would be prejudiced by the ERD Court accepting a settlement (Category 3 representors).
Therefore, although settlement will not operate as an absolute bar to joinder, it was the Court’s view that it will prevent anyone but Category 3 representors being joined to proceedings under the Development Act where a settlement has been agreed between the parties.
This decision also has the potential to limit joinder in instances where settlement has not been agreed between the parties.
Special Interest Threshold
The leading authority on the test for joinder applications, Pitt v Environment Resources and Development Court (1995) 66 SASR 274 (Pitt), now needs to be considered in light of the subsequent introduction of section 88(2)(c) of the Development Act. The provisions of section 205(2)(c) of the PDI Act now mirror this provision.
The Court held that:
… the subject matter of the provision [section 88] is plainly enough the broad discretion conferred by s 17 of the ERD Court Act and the manifest intention of s 88(2)(c) of the Development Act is to restrict the width of that discretion. It is therefore wrong to apply the approach adopted in Pitt to applications for joinder which fall within s 88(2)(c) of the Development Act. The duty of the Court is to properly construe and apply s 88(2)(c) of the Development Act.
Section 88(2)(c) provided that:
the Court may, in dealing with an application from a person to be joined as a party to the proceedings (other than the Crown, a relevant authority applying under section 37, or a person who was entitled to be given notice of a decision in respect of a Category 3 development under section 38 (if relevant)), determine not to grant the application—
- on the ground that the Court is not satisfied that the person has a special interest in the subject-matter of the application; or
- on the ground that, whatever the interest of the person may be, the Court is not satisfied that the interests of justice require that the person be joined as a party; or
- on any other ground determined to be appropriate by the Court.
(underlining added)
Whereas Duggan J in Pitt characterised the requisite interest of applicants for joinder as ‘a genuine interest’ without needing to ‘disclose something in the nature of a “special” case’, the Court in this matter has held that ‘the statutory test for joinder in s 88(2)(c) of the Development Act must necessarily require something more than a genuine interest’.
Therefore, it is no longer true that ‘as a general rule an adjoining neighbour will always have a sufficient interest to justify joinder’ as stated by Debelle J in O’Neill v Kimhi [2008] SAERDC 15. Rather, the Court has found that:
It follows that there must be something more than the mere status of a joinder applicant as a person notified of a Category 2 development. The additional matter might be that the adverse effects of the development on the particular joinder applicant extend beyond the generally contemplated effects on occupiers of premises adjacent to Category 2 developments.’
Take Home Message
This decision represents a significant departure from the previously settled understanding of the law relating to joinder and limits those parties able to be joined to proceedings brought under the Development Act, especially where a settlement has been reached between the original parties. It also has significant implications for future joinder applications made under the PDI Act as section 205 of the PDI Act is drafted in substantially the same terms as section 88 of the Development Act.
It is also likely that the ERD Court will now modify its practice of hearing joinder applications at first instance prior to any conference.
This decision is being appealed to the Court of Appeal of the Supreme Court. That appeal is likely to be heard early in the new year.
For more specific information on any of the material contained in this article please contact Gavin Leydon on +61 8 8210 1225 or gleydon@normans.com.au.
