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Demolition Approval, Statutory Conditions & Extension of time for Commencement

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In the recent (14.9.21) Planning and Environment Court decision of Karam Boutique Residential 8 Pty Ltd v Redland City Council [2021] QPEC 47, the Court was asked to grant an extension of the statutory (Building Act 1975) requirement that demolition works be ‘substantially commenced’ within 2 months from issue of a Demolition Approval issued under the Planning Act 2016. Curiously, the Building Act does not allow the Assessment Manager (usually a Building Certifier or Council) to grant an extension even in extenuating circumstances, hence the need to refer the matter to the P&E Court. McCarthy Durie Lawyers advised and represented the Applicant. His Honour Judge Jones DCJ granted the extension.

The situation arose where a Demolition Approval had been lawfully granted by a Building Certifier and a demolition contractor was on site ready to commence the works. Commencement was prevented by Redland City Council writing to the Minister for the Environment and the Great Barrier Reef (supervising the State Heritage Council) requesting the subject property at 509 Main Road Wellington Point be placed on the State Heritage Register. That resulted in the State Heritage Council immediately (without any contact with the property owner or investigation of the circumstances or even any enquiry of Council) to issue a Stop Order preventing any commencement of the demolition works. Some three months later (despite in the meantime urgent and detailed representations by McCarthy Durie Lawyers on behalf of the property owner and threats of legal action), the Minister advised that the property had no heritage value to the State.

Council then informed the property owner that it had in the meantime managed to obtain a Temporary Local Planning Instrument preventing any demolition works and in any case the two month statutory time limit for commencement of works had expired and could not or would not be re-enlivened.

Disregarding any consideration of fairness to the property owner, Council strenuously opposed the owner’s Application to the P&E Court resulting in a two day trial, descending into arguments about ‘structural soundness’ and costs to make structurally sound, notwithstanding affidavits of experts including engineer, building inspector and quantity surveyor about the state of disrepair and the substantial costs to make good, and even the demolition contractor stating he was in fact ready to commence the works as claimed. His Honour rejected all arguments presented by Council.

His Honour said that, with regards the Council referral to the Minister, “It would not be unreasonable to infer that the Acting Minister was acting on the street address provided by the Mayor rather than on reliable information and/or advice about where the house was actually situated”. His Honour also referred to the “concerning” correspondence from Council which may have led the Minister to unreasonably issue the Stop Order to the owners of a property containing a building requiring significant repairs to retain structural soundness.

His Honour held that issuing of the Stop Order had precluded the owner from exercising their lawful rights to demolish a building with “heritage value… [that is] highly questionable” under a development permit, which required the demolition work to have “substantially started” within 2 months of being granted pursuant to s 71(2) of the Building Act 1975. His Honour also determined that Council’s belated introduction of a TLPI (at least with regards the subject property) between the date of the Demolition Approval and the date of the hearing was not in the public interest.
His Honour stated that he had “… grave reservations about the public interest being served by protecting…” the house, and found that were it not for the Stop Order proscribing demolition, it was more than likely that the demolition works would have substantially started and more than likely concluded within a few days of commencement.

Subsequent to the issue of the Stop Order, Karam (a property developer) had nevertheless proceed to settlement of its purchase contract from the then owner. However, His Honour rejected Council’s arguments that Karam’s actions in settling the purchase after the Stop Order had been issued, and with knowledge that Council had “every intention of protecting the house from demolition” meant Karam had voluntarily assumed the commercial risk associated with the purchase were unpersuasive to the Court. His Honour said:

“… that the applicant took that risk ought not mean it must forfeit its rights to otherwise use the land for a lawful purpose”.

Pointedly, His Honour stated that “Any authoritative body with the power to impose material restrictions on how a landowner may exercise their rights in respect of the use of that land, particularly in the absence of just compensation or the right to be heard before the order is issued, ought be expected to exercise an appropriate level of due diligence before making the decision to issue that order. That was not the case here.”

Ultimately, Judge Jones found in favour of the Applicant and ordered that the noncompliance with s 71(2) of the Building Act 1975 be excused, providing the applicant with the opportunity to recommence demolition works as soon as practicable.

McCarthy Durie Lawyers was pleased to assist our client Karam Boutique Residential 8 Pty Ltd achieve this successful outcome. For further information, contact Ian Neil, Director.

We have assembled a highly experienced, capable team of legal practitioners, committed to delivering you expertise across all legal services. Find your local office: