In Hrsto v Canterbury City Council (No 2) (2014) NSWLEC, Justice Sheehan has confirmed that the residential components of a development must truly be physically "above" the retail and business elements in order for a proposal to be classified as "shop top housing".
Justice Sheehan's decision was made in relation to a development application which proposed the construction of 5 inter-related buildings. The designs for 3 of the 5 buildings did not call for any commercial or retail space on the ground floor levels at all. Rather, the ground floor levels of these buildings were all designated for use as dwellings. Retail space was proposed for the ground floor of one of the other buildings, and a cafe and gymnasium were proposed for the ground floor of the final building. However, the plans for both of these buildings also called for dwelling units on the ground floor. The plans for the development specified that most of the space on the ground floor levels of the buildings in the complex would be dedicated to dwellings.
The permissibility of the development, which was to be situated in a zone designated "B2 Local Centre" hinged on its being classified as "shop top housing", because "residential accommodation" (defined under the Council's LEP to include multi-dwelling housing and residential flat buildings) was classified as a prohibited use.
The applicant argued in its submissions that the multi-building development could be characterised as "shop top" housing so long as one or more dwellings in any of the buildings was located above the level of the retail and business premises in the other buildings. It was the applicant's further suggestion that it would be permissible to locate dwelling units on the same ground floor level of buildings in the complex where the retail/commercial premises were proposed, again so long as any of the other buildings in the complex contained dwelling units above the ground floor level.
Justice Sheehan categorically rejected the applicant's submissions concerning the manner in which "shop top" housing can be configured. Instead, he accepted the Council's arguments that in order for a building to be classified as shop top housing, dwelling units must be located in the same building as the commercial/retail elements, and must be "above" those elements, in the sense of being at a floor level higher than the top of the level where the retail/commercial elements are located. Thus, Justice Sheehan held that where the predominant form of a development proposal is to provide for dwellings on the ground floor levels, with no retail or business use in several buildings in a "multi-building" complex, that proposal cannot be considered to be "shop top" housing.
The decision by Justice Sheehan did not specifically address the question of whether any dwellings can be located on the ground floor level of a single building which also includes other dwellings at a level above retail or business space. The answer to that question will have to wait until another day; however, it does appear from the judgement that the amount of space allocated on the ground floor to dwellings would have to be limited, and be perhaps significantly less than the area allocated to retail and business use, in order for the shop top classification to be available.
The Court's decision, which was handed down on 14 August 2014, can be accessed at:
http://www.caselaw.nsw.gov.au/action/PJUDG?jgmtid=173285
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