Making time: extending development approvals in light of COVID-19 - Construction & Planning

There is much uncertainty surrounding the impacts of COVID-19. What is possible one morning may be impossible, if not outlawed, the next. Amongst these changes, developers are having to make decisions regarding projects while also holding a crystal ball to the future.

These decisions involve considerations as to contractual commitments, commercial necessity and the extent to which approvals have already been obtained.

However, where there is a time limit on an existing subdivision or development approval, the question becomes whether this can be extended to allow for a project to be carried out in the future. Making this issue even more complex for national developers is that the regime for extending planning approvals differs in each State.

In some jurisdictions, if a development approval has already been 'substantially commenced', or 'physically commenced' in NSW, the time limit on the approval will no longer apply. In this situation, the key concern will be to ensure that the project has crossed the threshold of being 'substantially commenced' or 'physically commenced' as per the legislative framework and complex judicial decisions which have considered this concept. For those approvals which require a project to be 'substantially completed' within a specified period of time, the position will be different.

Where works have not commenced, the issue will be whether the relevant authority has the power to extend any time limit on the approval. The following table sets out the general position for each State, although as always, the individual circumstances of the project will need to be considered:

State	Subdivision approval	Development approval
New South Wales	A one-off one year extension of time possible provided that maximum time limit of 5 years is not already granted [1]	A one-off one year extension of time possible provided that maximum time limit of 5 years is not already granted [2]
Victoria	Extension of time possible subject to making an application to the relevant authority	Extension of time possible subject to making an application to the relevant authority
Queensland	Extension of time possible subject to making an extension application to the relevant authority (usually the local government)	Extension of time possible subject to making an extension application to the relevant authority (usually the local government)
Western Australia	No power to extend time - new subdivision approval will be required once expired	Deemed provisions allow an application to be made to the local government to amend the development approval to extend time (similar provisions in relation to approvals issued by Development Assessment Panels)

Of course, where the relevant authority has a general discretion as to whether to extend the time limit on a planning approval, this only adds to the uncertainty for a developer. In this context, relevant considerations may include whether there has been a change in planning policy, whether a developer is 'warehousing' an approval, or the likelihood of a new planning approval being granted if a fresh application is made.

Approvals often come at great financial and time costs so having to go back to the 'drawing board' if an approval lapses will add to what are already difficult circumstances arising from the impact of COVID-19. Even if there is an ability to apply to the relevant court to revive a lapsed approval, that process is not embodied in the legislation and relies on the court's discretion. Until there is legislative change dealing with this issue, developers will have no choice but to consider the individual circumstances of each project which is even more difficult in the context of our current times.

This article is part of our insight series COVID-19: Navigating the implications for business in Australia and beyond. To get notified by email when new COVID-19 insights are released, please subscribe for updates here.

^[1]^{Kinder Investments Pty
Ltd v Sydney City Council (2005) 143 LGERA 237 at [3],
[6]]:}
^[2]^{See above.}

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.