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An inconvenient judgment?

Feature Articles

Cite as: (2008) 82(6) LIJ, p. 48

The judiciary’s significant contribution to climate change law is highlighted in the recent NSW decision of Walker V Minister for planning, placing obligation on developers and authorities to account for the future impact of global warming.

By Jordan Gray

“Climate change represents a risk to the survival of the human race and other species...it is a deadly issue1

This “deadly serious issue” is of increasing relevance to developers and consent authorities. Many developments requiring consent authority approval (e.g. coal mines, wind farms and desalination plants) will become reporters under the National Greenhouse and Energy Reporting System (NGERS), which is to come into effect this year after a period of consultation and review. NGERS will put in place a reporting framework, making it mandatory for Australian corporations to report annually on greenhouse gas emissions, energy production and energy consumption. The system is also intended to underpin a future emissions trading scheme (ETS).2

The benefits of NGERS and a future ETS for climate change mitigation must be considered concurrently with the benefits arising from climate change case law. The judiciary’s contribution to climate change law in Australia is extraordinary and cannot be overlooked when considering the obligations on developers and consent authorities in this area.3

The ETS will be unilateral in effect. It will be designed to measure potential and actual impacts of future developments on climate change and to mitigate them (the unilateral approach). On the other hand, the judiciary has played an important role in ensuring that our approach to climate change mitigation is bilateral. In addition to considering how a development will potentially exacerbate climate change, the effects of climate change on a development must also be considered (the bilateral approach).

The purpose of this article is first to examine the importance of the bilateral approach in planning and development law by analysing the landmark decision of Walker v Minister for Planning4 (Walker) and the Panel Report on the Colac Otway Planning Scheme Amendment C29 (the Report) and second, to clarify how Walker’s contribution to climate change law will supplement the ETS through the bilateral approach.

The facts in Walker

The case concerned a successful challenge to the validity of a concept plan approved by the NSW Minister for Planning under Part 3A of the Environmental Planning and Assessment Act 1979 (NSW) (the Act) which relates to major infrastructure and other significant development proposals in NSW.

The concept plan was for a residential subdivision and a retirement development on approximately 25 hectares of coastal land near Wollongong, an area where flooding had already been identified as a major constraint on the development of the site. The Woodlands Creek and other creeks drained through the proposed project site to the sea. Before the development proposal, some of these flows had been piped underground and it was necessary to restore surface flow in order for the development to go ahead. The concept plan had to be amended to widen the creek corridors after doubt was raised as to whether the corridors proposed by the developer (no doubt to allow for greater room to develop) were wide enough to prevent the adverse impacts of inundation to the area.

The grounds of challenge presented by the applicant (who was opposed to the development going ahead) were rejected with one exception. Coined the “climate change flood risk” by Biscoe J, the successful ground of challenge referred to an implied mandatory obligation arising from the Act to consider the principles of ecologically sustainable development (ESD) and, more specifically, an obligation to take into account whether “changed weather patterns would lead to an increased flood risk in connection with the proposed development in circumstances where flooding was identified as a major constraint on development of the site”. [166]

The “climate change risk” and development projects

ESD and the public interest go hand in hand

Biscoe J referred to the concepts of “ESD” and the “public interest” as used in the Act and extended his reasoning to show how those definitions were interdependent with the principles of international environmental law and domestic law in general.5 His Honour noted that one of the objects of the Act is the encouragement of ESD6 that “public interest” includes the principles of ESD and that ESD includes climate-related considerations.7

While it was clear from his Honour’s reasons that ESD was not mandated as an overriding goal but as part of a process [70], the case provides authority that ESD is a mandatory consideration when applying any public interest test to which ESD is relevant. For example, had the creek corridor design been ESD compliant (by accounting for the greater impacts of climate change), the outcome of Walker may have been different.

Basis of the “climate change flood risk” obligation

Biscoe J noted that Part 3A of the Act and s8B of the Environmental Planning and Assessment Regulation 2000 required the Director-General of the Department of Planning to submit an evaluation of the development project to the Minister, including an assessment of the environmental impact of the project and any aspect of the “public interest” the Director-General considered appropriate. In Walker, the Director-General’s report dealt with creek design and flooding but failed to discuss the environmental impacts of climate change on the proposed development. [27]

According to his Honour, the purpose of the Director-General’s report was to enable the Minister to make an informed decision, taking into account environmental precaution. [75] Accordingly, his Honour held that:

  • the Director-General was required to form an opinion as to what aspects of ESD were relevant to the project and include them in the report; and
  • the reference to “public interest” in the Regulation included the principles of ESD consistent with case law and the objects of the Act. [154]

More generally, his Honour held that climate change considerations have “loomed ever larger in the public and political eye for years” [164] and therefore were relevant to the content of the Director-General’s report, having regard to the subject matter, scope and purpose of the legislative regime. [155]

His Honour noted that the absence of any reference to the climate change exacerbated flood risk inferred that neither the Minister nor the Director-General had considered it at all [160]: “there cannot be an exercise of the discretion if the Director-General does not consider whether an aspect of the public interest that potentially has a direct bearing on the justice of the decision is relevant”. [165]

Had the Director-General determined that the impacts of climate change were not relevant to the project, the Minister would not have had an independent obligation to consider whether they were relevant. [160]

Walker establishes that ESD obligations extend to minimising our contribution to climate change and ensuring that the impact of climate change on developments is limited as far as possible, thereby supporting the bilateral approach.

The “climate change risk” in Victorian developments

While Victoria has been at the forefront of climate change litigation in many regards,8 the Walker decision is the first in Australia to apply the bilateral approach. However, Victoria’s policy frameworks for climate adaptation respond extensively to “climate change challenges” and state that planning must be in line with the principles of ESD.9

The “climate change flood risk” was considered in relation to the Colac Otway Planning Scheme Amendment C29.10 The redevelopment proposal sought to allow for (inter alia) the construction of 537 houses, a golf course, and a number of apartment developments on an area identified as a flood plain at Apollo Bay.11

A number of the submissions made to the Panel were concerned with the impact of rising sea levels on the development.12 Some of the specific issues raised were:

  • the development was within a flood plain;
  • the flooding impacts would be unacceptable; and there was potential for coastal recession to impact on the development.13
  • In contrast to Biscoe J’s finding in Walker, the Panel concluded that the proposal had taken prudent steps to guard against the predicted effects of climate change. In coming to that conclusion, some of the factors that the Panel considered were:
  • climate change had been considered and accounted for in the project proposal (e.g. flood modelling had been done by reference to the Intergovernmental Panel on Climate Change forecasts, and housing had been located well above typical flood event requirements);14
  • the proposal delivered an ecological benefit to the area that increased its sustainability and resistance to climate change (e.g. damaged watercourses would be repaired as a result of the development);15 and no evidence or analysis was presented that demonstrated that these accommodations were insufficient.16

The Panel expressed the opinion that the impact of the environment on private developments should not be ignored by decision makers but that the role of the developer in making its own assessment of these risks should be given a much higher weight.17 Whether this observation would be upheld at law is doubtful in light of the public interest element inherent in applying ESD principles. However, it is clear that the failure by the consent authority and the developer to account for the effects of climate change in the Walker development was not the case in the Amendment C29 proposal.

Impact on project developments

The Walker decision and the Report have particular relevance to the flooding effects of climate change on developments in coastal areas, but the principles analysed will also apply to other manifestations of climate change affecting developments, such as drought and fire. In practical terms, Walker will have important implications for major project and planning developments. For example:

  • developers can no longer sidestep climate-related considerations in assessing projects and must apply the bilateral approach;
  • streamlining project approval is a thing of the past; and
  • consent authorities must factor the bilateral approach into the ESD evaluation when approving concept plans under the Act.

The decision will also affect applications to develop or expand developments. Therefore, an assumption must be made that there is greater potential for adverse impacts that must then be factored into the development, including considering whether any mitigation measures can be designed.

Convergence of climate change law

Walker builds on recent decisions concerning the relevancy of ESD to the assessment of developments.18 The case law also complements the objectives of the ETS by:

  • ensuring that new developments (that will become reporters under the NGERS) are ESD evaluated before proceeding with the development, reinforcing the overall objective of reducing carbon emissions; and
  • giving clarity to “public interest” considerations to ensure that new developments are not adversely affected by climate change.

Conclusion

Walker is a helpful demonstration of what climate change case law has established and how its principles may interact with the NGERS in the future. Although Walker is merely a judicial review case, it has implications that extend beyond Part 3A projects alone. It continues a judicial trend to not only require that ESD principles are applied to assessments, but to actively require that these principles are expanded to include global environmental concerns and climate change.

Consequently, assessments by both developers and consent authorities must become increasingly environmentally aware and sensitive to the impacts of and on climate change as demonstrated in the Report. Where there is a failure to genuinely consider these matters, the courts will not hesitate to declare an approval void. After all, this is a “deadly serious issue”.

JORDAN GRAY is a solicitor in the major projects practice group at Baker & McKenzie.

The numbers in square brackets in the text refer to the paragraph numbers in the judgment.

1. Walker v Minister for Planning [2007] NSWLEC 741, per Biscoe J at 161. At the time of writing, the Walker decision was set down for appeal in the NSW Supreme Court.

2. See National Greenhouse and Energy Reporting System Regulations Policy Paper, February 2008.

3. Biscoe J provides a comprehensive summary of a vast number of decisions in Walker.

4. Note 1 above.

5. The Act adopts the definition of ESD from the Protection of the Environment Administration Act 1991 (NSW), s6(2).

6. Environmental Planning and Assessment Act 1979 (NSW), s5.

7. Walker, note 1 above, at 81: Biscoe J cited BGP Properties v Lake Macquarie City Council (2004) 138 LGERA 237 at 257; Telstra Corp Ltd v Hornsby Shire Council (2006) 146 LGERA 10 at [123]; and Carstens v Pittwater Council (1999) 111 LGERA 1 at 25.

8. See Australian Conservation Foundation v Minister for Planning [2004] VCAT 2029.

9. See, for example, the 2007 draft Victorian Coastal Strategy.

10. Under the Planning and Environment Act 1987 (Vic), a panel is to be formed to receive and review public comments regarding planning scheme amendments.

11. Panel report to the Colac Otway Planning Scheme Amendment C29, July 2007, p1.

12. Note 11 above, p14.

13. Note 11 above, p12.

14. Note 11 above, p38.

15. Note 11 above, p2.

16. Note 11 above, p51.

17. Note 11 above, p16.

18. See Gray v the Minister for Planning [2006] NSWLEC 720 and Telstra Corp Ltd v Hornsby Shire Council (2006) 146 LGERA 10.

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