Fred Caterson Champions Inc t/as Fred Caterson Champions v The Hills Shire Council

1. [1]

   LEEMING JA: I agree with Ball JA.

2. [2]

   ADAMSON JA: I agree with Ball JA.

3. [3]

   BALL JA: The appellant, Fred Caterson Champions Inc, appeals against an order made by the primary judge (Pritchard J) on 4 December 2025 refusing leave for the appellant to rely on expert evidence of Dr Stephen Debus, an owl biologist, in Class 4 proceedings against The Hills Shire Council (the Council) in the Land and Environment Court of New South Wales (the LEC): see Fred Caterson Champions Inc. trading as Fred Caterson Champions v The Hills Shire Council trading as The Hills Shire Council [2025] NSWLEC 139 (Primary Judgment or PJ).

4. [4]

   Leave to appeal, required by s 58(3)(a) of the Land and Environment Court Act 1979 (NSW), was granted by Ward P and Harrison AJA on 10 March 2026: see Fred Caterson Champions Inc trading as Fred Caterson Champions v The Hills Shire Council trading as The Hills Shire Council [2026] NSWCA 24.

Background

1. [5]

   The appellant is an incorporated association, the objectives of which are to maintain community access to the Fred Caterson Reserve in Castle Hill (the Reserve), while preserving its endangered ecological bushland, flora and fauna. That fauna includes the Powerful Owl, Masked Owl, and Sooty Owl (the Owls), each of which are listed as vulnerable species under the Biodiversity Conservation Act 2016 (NSW): see s 4.2 and Sch 1, Pt 3, Div 1 of that Act.

2. [6]

   On 9 May 2025, the Council approved the proposed development of a sports complex at the Reserve comprising three rugby union fields and related infrastructure, including lighting of 100 lux on each playing field (the Development). It did so by approving on 30 September 2024 a Review of Environmental Factors (REF) that had been prepared for the Council by Biosis Pty Ltd and by approving on 9 May 2025 an Addendum Review of Environmental Factors (Addendum REF) also prepared by Biosis (the assessment of development of recreational facilities on Crown land of which the Council is the manager has proceeded on the basis that it falls within cl 2.73(3) of State Environmental Planning Policy (Transport and Infrastructure) 2021 and may be carried out without consent).

3. [7]

   By summons filed in the LEC on 4 September 2025 and amended on 10 October 2025, the appellant seeks judicial review of the decisions to approve the REF and Addendum REF. Part of the appellant’s challenge, reflected in grounds 3 and 4 in the amended summons, is that the Council breached its duty to consider the environmental impact of the Development in accordance with s 5.5 of the Environmental Planning and Assessment Act 1979 (NSW) (the EPA Act). At the relevant time, s 5.5(1) of the EPA Act provided:

4. [8]

   Section 5.5(1) was amended with effect from 21 March 2026 to remove the phrase “to the fullest extent possible” and a new s 5.5(2) was added: see Environmental Planning and Assessment Amendment (Planning System Reforms) Act 2025 (NSW), sch 1[113] and [114]. The appeal proceeded on the basis that the relevant obligation was the one that existed before the amendment.

5. [9]

   Ground 3 alleges that the Council breached its duty under s 5.5 of the EPA Act by failing to make inquiries as to “the impact on the Owls being displaced from their habitat (including impacts on their feeding and breeding habits) by reason of increases in light spill associated with the [Development]”, and that this failure was legally unreasonable.

6. [10]

   Ground 4 alleges that, in breach of s 5.5 of the EPA Act, the Council failed to take into account the cumulative impact of the Development with other existing or likely future activities at the Reserve, as required by reg 172(1)(o) of the Environmental Planning and Assessment Regulation 2021 (NSW). The likely future activity relied upon by the appellant was a potential increase in lighting from 100 lux to 500 lux as part of negotiations between the Council and the Eastwood Rugby Club.

7. [11]

   By notice of motion filed on 31 October 2025, the appellant sought leave to commence the proceedings out of time pursuant to r 59.10(2) of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) and to rely upon a report dated 29 October 2025 from Dr Debus pursuant to UCPR r 31.19 (which is set out below).

8. [12]

   On 4 December 2025, the primary judge granted leave to the appellant to commence proceedings out of time but refused leave to rely on Dr Debus’s report. The appellant appeals against that refusal.

Reasoning of the primary judge

1. [13]

   The primary judge recognised that the use of expert evidence in Class 4 proceedings in the LEC is governed by Pt 31, Div 2 of the UCPR, which relevantly provides:

2. [14]

   The primary judge began her discussion of whether Dr Debus’s report should be admitted by pointing to some largely uncontroversial aspects concerning the nature of the proceedings before her. One was that the proceedings were for judicial review in which “the Court is tasked with determining whether the impugned decision was one that was legally made and not whether the Court, if tasked with making that decision for itself, would arrive at the same conclusion”, with the result that “[t]he Court is not permitted to stray into a consideration of the merits, as opposed to reviewing the legal adequacy of the impugned decision”: PJ[31]. Another was that the issue before the Court was whether the Council had complied with its obligations under s 5.5 of the EPA Act. That section did not impose some general duty to inquire but rather “the extent and scope of the consideration will vary depending upon the activity proposed and the likely environmental impacts of undertaking such activity”: PJ[32]. Her Honour accepted (at PJ[30]) the following statement in the judgment of Duggan J in Natural Grass at Norman Griffiths Inc v Ku-ring-gai Council [2023] NSWLEC 84 (Natural Grass) at [47]-[48] of the inquiry required by s 5.5:

3. [15]

   Thirdly, the primary judge, referring to a dictum of Pepper J in Fullerton at [144]-[145], accepted that in some circumstances expert evidence that was not before the decision-maker may be admissible in cases such as the one before her as evidence of what inquiries ought to have been made. In Fullerton, Pepper J, after pointing out that s 111 of the EPA Act (the predecessor to s 5.5) had embedded within it a duty to inquire said:

4. [16]

   After stating those principles, the primary judge gave the following reasons for rejecting Dr Debus’s report:

The grounds of appeal

1. [17]

   Four grounds of appeal are advanced:

Consideration

1. [18]

   A preliminary question on appeal is whether the correct standard of review is the standard stated in House v The King (1936) 55 CLR 499; [1936] HCA 40 or the correctness standard in Warren v Coombes (1979) 142 CLR 53; [1979] HCA 9. The former standard applies where the question before the primary judge admits of more than one answer. It requires the Court to consider whether the primary judge made an error of legal principle, made a material error of fact, took into account some irrelevant consideration, failed to take into account some material consideration, or arrived at a result so unreasonable or unjust as to suggest that one of the foregoing categories of error had occurred, even though the error in question did not explicitly appear on the face of the reasoning. The latter standard applies where the question, even if it is evaluative, has only one answer. It requires the Court to consider whether the decision below was correct. As Gageler J explained in Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30 at [49], the question whether a primary judge’s conclusion attracts the correctness standard or that in House v The King depends not on “whether the primary judge’s process of reasoning to reach a conclusion can be characterised as evaluative or is on a topic on which judicial minds might reasonably differ”, but rather:

2. [19]

   In the present case, the primary judge applied or purported to apply UCPR Pt 31 Div 2, which gives the Court a discretion to refuse to admit expert evidence taking account of the objectives set out in UCPR r 31.17. For that reason, the standard of review in House v The King applies. However, the primary judge concluded that Dr Debus’s report ought not to be admitted because the report was “in effect a critique of the merits of the assessment made by the experts retained by Council” (PJ[33]). That conclusion was essentially a conclusion that the report was irrelevant to the issues to be determined by the Court. As the primary judge had emphasised earlier in her judgment, it was not appropriate on an application for judicial review for the Court “to stray into a consideration of the merits” (PJ[31]). The question, therefore, is whether the primary judge made an error of principle in concluding that the report was irrelevant. Necessarily, that question has only one answer. Grounds 1 and 2 of the notice of appeal essentially raise the issue whether the answer given by the primary judge to that question was correct.

3. [20]

   The primary judge explains that the Council obtained expert reports from Narla and Raintree Consulting which addressed the effect of the Development on the Owls and on the basis of which the REF concluded that the impact of the Development on them would be “minor/minimal” (PJ[34]). Her Honour said, without explaining why, that she considered that Dr Debus’s report “provides an assessment of the merits of the [Development], and not an identification of any reasonable inquiry that a reasonable decision maker would make over and above” the enquiries undertaken by the experts retained by Council.

4. [21]

   No criticism was made of her Honour’s judgment on the basis that her Honour failed to give adequate reasons for her decision. That is understandable in a context where the primary issue before her Honour was whether an extension of time should be granted and the matter was one of some urgency. Instead, the focus of the submissions before this Court was on whether the conclusion reached by the primary judge could be supported by an analysis of the reports obtained by Council and Dr Debus’s report, not on whether the primary judge’s reasoning was correct.

5. [22]

   Although substantial parts of Dr Debus’s report do provide an assessment of the merits of the Development, an examination of the report reveals that, contrary to the conclusions of the primary judge and the submissions of the Council, the report is also relevant to the inquiries that ought to have been undertaken.

6. [23]

   A summary of Dr Debus’s conclusions can be found in the following paragraphs of his report:

7. [24]

   These paragraphs need to be understood in context. On 15 and 16 May 2023, Narla undertook what it described in its July 2024 report as “surveys for threatened Owls which had the potential to utilise the site” which included two nights of “spotlighting, covering the entire property”, two nights of hollow watches and two nights of “call play back” at 16 locations across the “Subject Property”. It had earlier defined in the report the “Subject Property” as being the “Hills District Pony Club (Lot 224/-/DP752020)” and the “Subject Site” as being “an area of approximately 4.92ha, occupying the majority of the western extent of the Subject Property”, which is where the Development is to take place. The Subject Property (as defined) is part of the much larger Reserve. Based on those observations, the report states under the heading “Breeding Habitat Present Within the Subject Site”:

8. [25]

   Under the heading “Anticipated Impact”, the report states:

9. [26]

   That conclusion was largely picked up in the REF which states in relation to the Powerful Owl:

10. [27]

    The conclusions of the July 2024 report were largely repeated in Narla’s final Flora and Fauna Assessment Report issued in April 2025.

11. [28]

    None of Narla’s reports deals specifically with the effect that the lighting would have on the Powerful Owl. In an Ecological Constraints Assessment Report prepared in May 2023, Narla said under the heading “Light Spill”:

12. [29]

    The July 2024 report contains the following recommendation in relation to Light Spill Minimisation:

13. [30]

    As Dr Debus observed, there was clear evidence before the Council from observations of Birdlife Australia that there are a pair of resident breeding Powerful Owls in the Reserve near the edge of the Subject Property. That evidence appears to be the basis of Narla’s statement in the July 2024 Report that “[t]his species … is known to occur and breed within the neighbouring vegetation”.

14. [31]

    In that context, Dr Debus’s report relevantly makes two points. First, Dr Debus expresses the opinion that, knowing of the existence of the resident breeding pair of Powerful Owls, it would have been reasonable to conduct a more detailed assessment of the likely effect of the Development on that pair. Second, he expresses the opinion that any such assessment would need to include an assessment of the impact of light spill on the foraging and breeding habitat of that pair and that that assessment had not been undertaken “in the ecology reports”. According to him, that assessment would include an assessment of the extent to which light spill would affect the current known nest of the pair and other available nest trees for the pair. It would also include an assessment of the extent to which the light spill would affect potential prey in the foraging range from those nests. To that extent at least, Dr Debus expresses opinions on the nature and reasonableness of additional inquiries that ought to have been undertaken. His report was, therefore, relevant and the primary judge was wrong to exclude it because it was not.

15. [32]

    In view of that conclusion, it is not necessary to deal with grounds 3 and 4 of the notice of appeal in any detail. As the primary judge recognised when quoting from the decision of Duggan J in Natural Grass, the nature of the issue raised by s 5.5 of the EPA Act imports the concept of reasonableness and necessarily raises the question whether it was unreasonable in the legal sense not to make the asserted inquiry. In that context, her Honour should be understood as dealing both with the question whether the Council had fulfilled its statutory obligation and with the question whether its decision was unreasonable in the legal sense. For that reason, ground 4 does not raise any additional error on the part of the primary judge.

16. [33]

    Ground 3 takes issue with PJ[35]. Read literally, it may be taken as an independent reason for rejecting Dr Debus’s report; and if it is read in that way it suffers from the problem identified in ground 3. Read in that way, it also appears to resolve an ultimate issue in the case when deciding whether to grant leave to admit evidence. However, in context a fairer reading of the paragraph is that it is a summary of the conclusions stated in PJ[33]-[34]. Read in that way, ground 3 does not arise.

Consequences

1. [34]

   It follows from what has been said that the order made by the primary judge rejecting Dr Debus’s report should be set aside. The question remains whether this Court should refer the matter back to the primary judge to determine the issue in accordance with its judgment or whether this Court should determine the question of admissibility itself. If possible, the latter course is clearly preferable, since it avoids any further hearing of the issue in the court below and obviates the risk of further appeals.

2. [35]

   The discretion conferred by UCPR Pt 31 Div 2 primarily requires a court to consider two matters. The first is the significance of the expert evidence to the issues to be determined in the case. The second is the costs (in terms of both time and money) of admitting the evidence.

3. [36]

   In considering the first question, it is important to bear in mind the issue to which Dr Debus’s report is relevant. That issue is whether the Council complied with its obligation under s 5.5(1) of the EPA Act to examine and to take into account to the fullest extent possible all matters affecting or likely to affect the environment by reason of the activity (that is, the Development) and whether having regard to that obligation it acted unreasonably in failing to make further inquiries concerning the effect of the Development on the pair of breeding Powerful Owls that is located near the Development. It is apparent from its amended summons filed on 10 October 2025 and the submissions made to this Court that the case that the appellant seeks to advance at the hearing before the LEC is that the Council did not comply with its obligation, and acted unreasonably, because acting reasonably it would have sought further information concerning (1) the precise location of the breeding pair’s nest; (2) the foraging range from that nest; (3) the extent to which light spill from the Development at night would affect the nest and the area falling within the foraging range (and therefore the available prey in that area); and (4) the availability of alternative nesting sites for the pair and the extent to which light spill would affect those sites and the areas falling within the foraging range of them.

4. [37]

   This Court is clearly in a position to consider the significance of Dr Debus’s report to that question, since it has the report and the other material that was before the Council.

5. [38]

   As to the second question, there is limited information before this Court on the likely consequences of admitting the report. During the hearing before this Court, Ms Painter SC, who appeared for the appellant, suggested that admission of the report “might add an hour or two, or maybe half a day” to the hearing. Ms Morgan SC, who appeared for the Council indicated that the Council had not yet decided whether it would seek leave to provide a report in reply to Dr Debus’s report if his report was admitted. There is no information that any of the opinions in Dr Debus’s report are controversial, or, if they are, the extent of that controversy. There is also no information before the Court concerning the likely cost of obtaining a report in reply.

6. [39]

   Notwithstanding the absence of evidence, in my opinion, this Court is able to determine the question. At the time the issue arose before the LEC, neither party sought to lead evidence concerning the consequences of admitting Dr Debus’s report. There is no reason to think that they would do so if the issue were referred back to the LEC. The expert evidence in chief on which the appellant seeks to rely has, of course, been prepared and its precise scope is known. The Court knows that the Council has retained an expert (Narla) that already has a detailed knowledge of the case, so that the Court has some understanding of the burden that will be placed on the Council if the evidence is admitted.

7. [40]

   In my opinion, Dr Debus’s report ought to be admitted. It was suggested during the course of argument that the report served no utility because the argument that the appellant seeks to advance at the hearing can be advanced in the absence of the report. No doubt, some argument concerning the need for further investigation of the effect of the Development on the pair of breeding Powerful Owls could be advanced on the basis of the material already before the Court. However, Dr Debus’s report helps to give content to the argument and in doing so will provide assistance to the Court hearing the matter in determining whether the additional inquiries that the appellant submits should have been undertaken were required by s 5.5(1) of the EPA Act and are necessary in order to satisfy the Council’s obligation not to act unreasonably (in the legal sense). Without the report, the Court would have no evidence before it about what inquiries an expert might undertake.

8. [41]

   Obviously, the expert evidence the appellant seeks to rely on has already been served, with the consequence that the scope of that evidence is clear. The issue is a narrow one. The Council has retained an expert (Narla) who already plainly has a detailed knowledge of the issue and would be in a position to reply to Dr Debus’s report insofar as it is relevant without the need for extensive work if the Council chooses to serve expert evidence in reply. Consequently, it is reasonable to conclude that the admission of Dr Debus’s report will not add substantially to the hearing time or impose substantial additional costs on the Council. Nor is it likely to cause a substantial delay in the hearing of the case.

9. [42]

   Taking those matters into account, I have concluded that the report of Dr Debus should be admitted into evidence.

Orders

1. [43]

   As I have pointed out, and as the primary judge recognised, Dr Debus’s report does contain material that goes to the merits of the case and which therefore is irrelevant. There is a question of how to deal with that material. One way is to seek to exclude material in the report that is only relevant to the merits of the case, although that approach is likely to lead to further disputes which will take time and costs to resolve. A second possibility is for the court to make an order under s 136 of the Evidence Act 1995 (NSW) limiting the use that can be made of the report. A third possibility is to admit the report without limitation, leaving it to the judge hearing the matter when preparing her final judgment to determine what use if any should be made of the report. What course is appropriate is a matter that should be left to the judge hearing the matter. Much will depend on the attitude taken by the Council and whether and if so how it seeks to respond to Dr Debus’s report. The orders I propose are not intended to place any restrictions on the judge hearing the matter in that regard.

2. [44]

   The orders I propose are:

   1. (1)

      Appeal allowed;

   2. (2)

      Order 2 of the orders made on 4 December 2025 by Pritchard J in the Land and Environment Court be set aside;

   3. (3)

      The appellant is granted leave to rely on the affidavit of Dr Stephen Debus affirmed on 30 October 2025;

   4. (4)

      The respondent is to pay the appellant’s costs of the appeal (including the costs of the application for leave to appeal).