What has happened?
In MHN Design Union Pty Limited v Mosman Municipal Council [2026] NSWLEC 141, Justice Pepper set aside a Commissioner's decision to refuse a modification application for a rooftop terrace at 8-12 Balmoral Avenue, Mosman. The Commissioner refused the application because of privacy impacts from the terrace's external stairs. However, the Council's case, and all of the evidence, had been about the terrace itself.
Context
The owner applied to modify an existing development consent to add a rooftop terrace and an external staircase to an approved dwelling. Mosman Municipal Council (Council) refused the application, and the owner appealed to the Land and Environment Court.
The Council's statement of facts and contentions alleged that the terrace, which could hold many people at once, would unreasonably overlook surrounding properties. It relied on two privacy controls in the Council's development control plan (DCP):
P2, which says terraces and other outdoor spaces must not directly overlook neighbouring rooms and private landscaped areas unless screening can mitigate overlooking; and
P3, which says roof top terraces are not permitted unless it can be shown that there is no loss of privacy or views.
The planning experts' joint report, the sightline drawings and the cross-examination all dealt with overlooking from the terrace. None of the evidence looked at overlooking from the stairs.
The Commissioner found that view loss and acoustic privacy did not warrant refusal. However, he found that the external stairs were "the primary source of the impact" on a neighbouring home, because a person using them would have a direct and sustained view into that property. He held the stairs breached P2 and P3 and refused the application. He also observed that a differently configured stair, such as a spiral stair within the terrace, could avoid the problem.
The decision
The owner appealed under s 56A of the Land and Environment Court Act 1979, which allows an appeal from a Commissioner on a question of law. The Council filed a submitting appearance, so it did not oppose the appeal.
Justice Pepper upheld the appeal. Her Honour held that:
A party is entitled to know the case against it. A denial of procedural fairness is an error of law. If a Commissioner intends to decide a merit appeal on an issue that has not been argued, the Commissioner must tell the parties and give them an opportunity to respond.
The stairs had never been in issue. The Council's contentions, the expert evidence and the submissions were all about the terrace. During the hearing, the Commissioner asked only about the size of the stairs and possible light spill. He did not raise any concern about overlooking from them.
A passing reference in closing was not enough. One brief reference to people using "the stair" in the Council's closing submissions was, in context, about the top of the stairs on the terrace. Even if it was an attempt to raise a new case, it came after the evidence had closed and the owner had made its submissions, which would itself be unfair.
The unfairness was material. If the owner had been given notice, it could have proposed changes, such as screening the stairs. The Commissioner himself had recognised that a different design could avoid the impact.
The matter was sent back to the same Commissioner to decide again. Justice Pepper noted that, on the rehearing, the Commissioner may consider whether the owner should be allowed to amend its proposal to address the concerns, once they have been properly identified.
The owner did not seek costs. However, her Honour observed that, by filing a submitting appearance rather than agreeing to the orders, the Council had left the owner to bear legal costs that might otherwise have been avoided. She described this as "somewhat unsatisfactory".
How will this affect you?
Applicants: if a refusal turns on an issue that was never raised in the contentions, the evidence or submissions, you may have grounds for an appeal on a question of law.
Councils: the statement of facts and contentions defines the case. New concerns should be raised early, by amending the contentions, not in closing submissions.
Further information
For further information please contact Darren Bick, Director, on +61 416 167 556 or darren.bick@bicksteele.com.au.