THE state's biggest housing development, the controversial $1.5 billion Huntlee New Town proposed near Branxton, has been dealt another major setback following a successful legal challenge.
The NSW Land and Environment Court overturned yesterday the project's state significant site status and rezoning for more than 7000 homes and employment lands that was gazetted in December last year under the former Labor state government.
Justice Peter Biscoe upheld the challenge from the Sweetwater Action Group in finding former minister for planning Tony Kelly had not properly considered the need for remediation work on some of the site's land and its suitability for uses once rezoned.
As well, the minister should not have heeded a voluntary planning agreement for the development, in which the proponents agreed to transfer more than 5000 hectares of conservation offset lands and $1.1 million to manage the lands to the government following the site's gazettal.
Justice Biscoe found the agreement should have been irrelevant as payment of the money under the agreement was unenforceable.
He ordered the respondents, the Minister and Huntlee Pty Ltd, to pay the group's legal costs, subject to any submissions this morning.
The decision casts doubt on the assessment process for any further Huntlee applications, after the Coalition government scrapped Labor's unpopular "Part 3A" major project laws in favour of returning more proposals to councils or joint regional planning panels.
Huntlee proponent LWP Property expressed disappointment last night at the decision. But LWP managing director Danny Murphy said "we will now regroup and assess all our options".
"We remain committed to this important regional project and take Justice Biscoe's decision and feedback on board," he said.
Action group spokesman Chris Parker described the win as a "sweet victory" for a small group, and said it showed "the little man can win if you put in the hard work".
The Coalition's new state significant development planning system includes some big residential projects but at sites that do not include Huntlee.
Transition arrangements provide for the independent Planning Assessment Commission to continue assessing under Part 3A laws applications that were well advanced when the changes were made.
Planning minister Brad Hazzard said last night he would "study the judge's decision closely and determine the proper course to move forward."
"The Liberal and Nationals when in opposition expressed concerns about the development approval of Huntlee by the former Labor government," Mr Hazzard said.
"Today's decision by the Land and Environment Court confirms that concerns of the community and the Liberal/Nationals were spot on."
It is the second challenge against the development.
Previously, the government conceded it had granted approval for the project unlawfully, in the wake of a separate court decision that found memorandums about offset conservation lands constituted a "land bribe".
Cessnock Greens city councillor James Ryan said the latest decision raised questions about the use of voluntary planning agreements in NSW.
It also showed the need for the government to tear up the Lower Hunter Regional Strategy, which identifies Huntlee as a development area despite it ranking last out of 91 sites considered for housing.
The 2006 strategy is due for its first major review this year.
The action group was unsuccessful in arguing that the minister was "infected by apprehended bias" because the regional strategy included Huntlee and references to conservation lands.
Justice Biscoe found that no "fair minded observer" would conclude that "the minister would not consider the merits of individual proposals as and when required" because of the strategy.
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