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Note: Julien Klettenberg (Homeowner) submitted a Development Application to the Woollahra Municipal Council (Council) to propose renovations to his home, including but not limited to demolishing a carport and building a new garage and loft structure. Council refused to accept this proposal, subject to the municipality’s building code, and Homeowner appealed this decision. The Land and Environment Court of New South Wales, O’Neill C. upheld the appeal and ruled that granting the proposal was lawful and appropriate. Following the opinion, the court outlined Council’s conditions for granting consent, pursuant to section 80 of the Environmental Planning & Assessment Act 1979, and provided that payment by security for construction projects to Council under the Building and Construction Industry Long Service Payment Act, 1986 may be made by a bank guarantee.

Text: The amended proposal contained the following terms of a required bank guarantee:

How must the payments be made?

Payments must be made by:

•  Cash deposit with Council,

•  Credit card payment with Council, or

•  Bank cheque made payable to Woollahra Municipal Council.

The payment of a security may be made by a bank guarantee where:

•  The guarantee is by an Australian bank for the amount of the total outstanding contribution;

•  The bank unconditionally agrees to pay the guaranteed sum to the Council on written request by Council on completion of the development or no earlier than 12 months from the provision of the guarantee whichever occurs first [NOTE: a time limited bank guarantee or a bank guarantee with an expiry date is not acceptable];

•  The bank agrees to pay the guaranteed sum without reference to the applicant or landowner or other person who provided the guarantee and without regard to any dispute, controversy, issue or other matter relating to the development consent or the carrying out of development in accordance with the development consent;

•  The bank guarantee is lodged with the Council prior to the issue of the construction certificate; and

•  The bank’s obligations are discharged when payment to the Council is made in accordance with the guarantee or when Council notifies the bank in writing that the guarantee is no longer required.

[JLN]

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