This decision delivers some reminders when dealing with variation requests, development within the foreshore, owner’s consent, and the ways in which the Court will consider controls within local environmental plans.

Background

XYZ Services Pty Ltd proposed to demolish an existing dwelling in Balmain, subdivide the lot, and build two new homes – each with a pool, deck and foreshore access. The site is zoned R1 under the Inner West Local Environmental Plan 2022 (the LEP) but partly sits in the “Foreshore Area” mapped under clause 6.5, which limits what can be built near the water.

Clause 6.5(3) only allows consent for limited developments in the Foreshore Area – things like boat sheds, fences, pools, and the rebuilding or alteration of an existing building. New dwellings aren’t on the list.

The Council refused the development application (or, rather, was deemed to have refused it) and raised four major objections. The matter went to the Land and Environment Court, where Commissioner Walsh granted consent – subject to conditions. The Council then appealed to the Chief Judge on a question of law under section 56A of the Land and Environment Court Act 1979.

This article focuses on that appeal.

Key issues on appeal

The Council said the Commissioner got it wrong on all fronts. Its appeal grounds boiled down to four core arguments:

1. Clause 6.5(3) isn’t a development standard, so it can’t be varied by way of a variation request under clause 4.6
2. Even if it is a development standard, the clause 4.6 request didn’t adequately justify the contravention
3. The development application required the consent of an unknown adjoining landowner
4. The proposal breached a restrictive covenant – and consent therefore had no utility

Clause 6.5(3): a development standard or outright prohibition?

Clause 6.5(3) states:

(3) Development consent must not be granted for development on land to which this clause applies except for the following purposes—
(a) the extension, alteration or rebuilding of an existing building wholly or partly in the foreshore area,
(b) boat sheds, cycleways, fences, jetties, retaining walls, slipways, swimming pools, walking trails, waterway access stairs, wharves, picnic facilities or other recreation facilities (outdoors).

The Court dismissed this ground and made it clear: clause 6.5(3) is a development standard.

The Court noted that this clause sets spatial controls on development – location, siting, and setbacks from the foreshore. These fit squarely within the statutory definition of “development standards” under section 1.4 of the Environmental Planning and Assessment Act 1979. Even though the provision lists certain permitted development types in foreshore land, it doesn’t impose a blanket prohibition. The site’s zoning (R1) permits dwellings—so clause 6.5(3) regulates how they can be done, not whether.

The judgment also confirmed that the two-step “Poynting” test (used to distinguish between a standard and a prohibition) is subordinate to the statutory definition. The Commissioner wasn’t wrong to go straight to section 1.4 and decide accordingly.

In this regard, it is important for practitioners to note that foreshore restrictions – even if framed negatively – can still be development standards if they regulate siting or form. And that opens the door to clause 4.6 requests.

The Clause 4.6 Request

The Court held the Commissioner was right to uphold the variation request under clause 4.6 of the LEP. XYZ’s written justification demonstrated that:

• Natural foreshore processes would not be adversely impacted; and
• The visual significance and amenity of the area wouldn’t be harmed.

Council argued that “significance” should have included heritage significance (given the Iron Cove Heritage Conservation Area). The Court disagreed. Clause 6.5(1)(b) refers to “significance of the area” generally, not necessarily heritage significance, and heritage issues could be considered under clause 5.10 of the LEP, but weren’t mandatory in the context of clause 4.6.

In this regard, it is important to note that a clause 4.6 request can still pass muster even if it doesn’t specifically address heritage significance, unless the clause being varied clearly demands it.

The Land Next Door

The Council claimed part of one new dwelling (Dwelling 1B) extended into a narrow “sliver” of unknown ownership and that owner’s consent was required. XYZ amended its plans to avoid this issue, proposing no works on that land.

While there remained “construction uncertainty” about the stability of a retained wall, the Commissioner accepted a consent condition that works could not proceed unless XYZ obtained ownership or development consent for any work on the sliver.

The Court agreed this was sufficient.

Accordingly, so long as no development is proposed on the adjoining land, no consent is needed – even if structural stability issues mean consent may be needed later.

The Covenant

The site was burdened by a restrictive covenant imposed by Council in 1966, preventing new structures beyond a foreshore building line. Council argued the covenant was enforceable and made the development application effectively useless.

The Commissioner acknowledged the covenant but found:

• Its weight as a planning concern was diminished due to existing similar encroachments in the area; and
• Utility wasn’t a matter for now—Council could choose later whether to enforce or vary the covenant.

The Chief Judge on appeal agreed. The covenant didn’t legally prevent the grant of consent – only potentially its implementation.

It is important to note that just because a development may breach a covenant doesn’t mean the Court can’t grant consent. Utility is a separate (and later) issue.

Conclusion and Takeaways

The appeal brought by Council was dismissed. XPZ got to keep it’s consent, and also have its costs paid for by the Council.

This decision matters because it:

1. Confirms that foreshore controls are often development standards which are capable of variation under clause 4.6.
2. Provides guidance on what is needed to justify a variation in a heritage context.
3. Demonstrates a pragmatic approach to owners consent, focusing on what the application proposes and not on future hypothetical steps.
4. Provides a reminder that if you want to rely on a restrictive covenant to resist development, you may need to actively enforce it.

Read more

Read the full judgment by clicking here.