Board Meeting: November 2013
Agenda Number: 10 (vi)
File Ref: PO0118
LORD HOWE ISLAND BOARD
Business Paper
ITEM
Termination of Permissive Occupancy (1995/01) and creation of a new Permissive
Occupancy for the purpose of a boatshed on vacant Crown land to the west of Lagoon Rd
BACKGROUND
Section 31A of the Lord Howe Island Act (the Act) provides that the Minister, on
recommendation of the Board, may grant permissions, being permissive occupancies, to
occupy vacant Crown lands or Crown lands the subject of the Act for such purposes and
upon such terms and conditions as the Minister may impose on the recommendation of the
Board.
A permissive occupancy (PO) may not be transferred or willed under the Act and may be
terminated at any time by the Minister on the recommendation of the Board. A permissive
occupancy is merely a personal licence, affording a defence against an action in trespass
(s32 of the Act) and gives no interest in the land.
In 1995 the Minister issued a permissive occupancy, PO1995/01, to Margaret Rourke and
Kerry McFadyen for the purpose of a boatshed on vacant Crown land to the west of Lagoon
Rd.
On 24 February 2011, the Board received a request to transfer the PO to Edward Marshall
Rourke, husband of the late Margaret Anne Rourke and beneficiary of Pinetrees under the
will of Margaret Anne Rourke.
In October 2011 the Board considered a request to transfer interests under the will of
Margaret Rourke, as listed below, to Edward Rourke, husband of the late Ms Rourke and
beneficiary.
Tenure No.
1954/33
2006/09
1995/01
Tenure Type
Perpetual lease (50% Tenants in Common)
Special lease
Permissive Occupancy (Boatshed)
Portion/s
236
234
n/a
The Board approved to recommend to the Minister to transfer Perpetual Lease 1954/33,
Special lease 2006/09 and to terminate PO1995/01 and issue a new permissive occupancy
to Edward Marshall Rourke and Kerry Elizabeth McFadyen. In March 2012 the Minister
approved the Board’s recommendation to transfer Perpetual Lease 1954/33. In November
2012 the Minister renewed Special Lease 2006/09, and all other special leases on Lord
Howe Island for a five year period.
In April and June 2013 the Board’s Administration notified the leaseholders and advised that
the Board has deferred its decision to recommend to the Minister to grant a new Permissive
Occupancy.
CURRENT POSITION
The risk of damage to the boatshed from coastal processes and consequent legal action
against the Board is discussed below. Other issues such as the commercial use of the
boatshed, and rent, are also discussed.
Risk of damage to the boatshed from coastal processes
In March 2012 Minister Parker awarded the Board a grant, through the NSW Coastal
Management Program, to prepare a Coastal Hazard Definition and Coastal Management
Study on Lord Howe Island. Haskoning Australia was engaged by the Board to complete
this work.
In October 2013, Haskoning Australia provided specific advice to the Board on erosion in the
Pinetrees Boatshed area. The report states that ongoing recession in the Pinetrees
Boatshed area is likely to be influenced by both natural and anthropogenic processes.
Natural storm processes are likely to be a significant contributor to erosion at Pinetrees
Boatshed. Various works may have also contributed to additional erosion / recession in the
area. The area located immediately north of the structures (runway, Seabee wall, and bag
wall) are reducing in volume by up to 540m3 per year or moving landward (receding).
In August 2012, the erosion escarpment at the Boatshed was measured as being 7.6m from
the seaward face of the structure, with the deck seaward of the boatshed within 1m of the
escarpment. The most seaward 3m of the boatshed is presently within a Zone of Reduced
Foundation Capacity. The boatshed may not be undermined in the next severe storm
(depending on its magnitude), but one further storm (without any significant intervening
natural beach recovery or human intervention) may lead to undermining.
Risk of legal action
During 2011, the Pinetrees leaseholders raised concerns regarding erosion of the fore dune
adjacent to the Pinetrees boatshed. In formal correspondence to the Board it was stated
that the actions of the Board have resulted in erosion processes and the Board would be
liable for any damage to the structure.
Based on the findings of the report by Haskoning Australia, and advice from the Boards legal
advisor, it would be possible to include a condition in any new PO stating that the land is
subject to coastal hazards and that the PO will be terminated at a certain point in time (for
example when coastal erosion immediately threatens the structures). It would also be
possible to include a clause whereby the occupants acknowledge that the structures on the
land are subject to risk from coastal erosion and that they have sought the PO in full
knowledge of this, have voluntarily assumed this risk and include a condition in the PO
Agreement whereby the occupants expressly agree to waive any claim for negligence
against the State of NSW, the Minister and the LHIB, and agree to indemnify the State of
NSW, the Minister and the LHI Board against any and all actions arising from loss or
damage to the structures arising from coastal erosion.
Commercial use of the Boat shed
In December 1993, the Board approved a development application to construct a new
boatshed for boat and equipment storage and work area. The design included a shower,
toilet and rigging deck.
In May 1998, the Board directed that Pinetrees submit a development application to
legitimise the use of the Boatshed for entertainment of guests. To date this has not occurred.
The boatshed is currently used seasonally (at least 3 months per year, at least once a week
for 1-2 hours) to serve canapés and drinks, and the remainder of the time as a self-service
bar area. It is occasionally used as a venue for other functions. These uses have been
carried out in association with tourist accommodation at Pinetrees Lodge. The boatshed is
promoted prominently on the Pinetrees website and other promotional information. The
tender for the Albatross is stored in the shed, but its use is restricted because of the erosion
of the escarpment which has created an almost 2m drop to the beach.
The Board has received legal advice which states that the Board may not lawfully
recommend and the Minister may not lawfully grant a Permissive Occupancy allowing
occupation of land, prior to requisite consent being obtained.
The Board’s planning consultant has advised that under the LHI Local Environmental Plan,
the approved use and the current use of the boatshed is best described as being an ancillary
use to tourist accommodation. Development for the purposes of tourist accommodation or a
commercial premises is prohibited within Zone 7 Environment Protection. As such, the use
as a boatshed (as originally approved) would be operating under existing use rights.
It is also their view that the current use of the boat shed is significantly different to the
approved use. Section 45 of the Environmental Planning and Assessment Regulation 2000
requires development consent for any change of an existing use to another use. However,
as established above, the current use is prohibited in Zone 7 and a development application
for this use could not be approved by the Board.
Notwithstanding the issue of permissibility outlined above, any future development
application would need to be able to satisfy Clause 35(2) of the Lord Howe Island Local
Environmental Plan 2010, including consideration of the public interest test and coastal
processes over a reasonable planning timeframe of say 40 to 50 years.
If there is any doubt about the lawfulness of the way in which a permission may be
exercised, such as in the case of Pinetrees, the Board can recommend conditions that
specifically proscribe any element of a use that may be unlawful if carried out. These
conditions would then be enforceable under s32 of the Lord Howe Island Act and the
Environmental Planning and Assessment Act 1979.
Rent
In accordance with the permissive occupancy agreement an annual rental is paid by the
holder. The annual rent is determined, generally every 3 to 4 years, by an independent
valuer. The current annual rent charged for PO1995/01, determined in November 2012, is
$3,326 per annum. It should be noted that a semi commercial rent has been applied to the
boatshed in the past to reflect its existing exclusive use.
The Act also includes provisions which allow the Board to levy and recover an approved fee
for any service it provides (Section 15). It is recommended that the Board introduce a fee to
recover costs associated with coastal protection works at Pinetrees Boatshed.
RECOMMENDATION
That the Board recommend to the Minister to:a)
Terminate Permissive Occupancy 1995/01, being for the purpose of a boatshed on
vacant crown land to the west of Lagoon Rd, previously held by the late Margaret
Anne Rourke and Kerry Elizabeth McFadyen,
b)
Grant permission to occupy Crown Land, for the purpose of a boatshed on vacant
crown land to the west of Lagoon Rd, to Edward Marshall Rourke and Kerry
Elizabeth McFadyen, subject to the standard Permissive Occupancy conditions and
the following special conditions:
 that the occupants acknowledge the erosion risk and expressly agree to waive
any claim for negligence, against the State of NSW, the Minister and the LHIB,
and agree to indemnify the State of NSW, the Minister and the LHI Board against
any and all actions arising from loss or damage to the structures arising from
coastal erosion;
 that the Permissive Occupancy will be terminated when coastal erosion
immediately threatens the structures including the boatshed and decking;
 that any use of the land is limited to those for permissible purposes; and
 the occupant agrees to the payment of annual rent as determined by an
independent valuer.
Prepared David Kelly
Manager Environment & Community Development
Endorsed Bill Monks
A/Chief Executive Officer