Partner Perspectives: Paul Vergotis

How did you get into the legal field? Was it always your ambition to become a law firm partner?

I started life as a town planner back in the eighties. I started my planning career with a large metropolitan local council, south of Sydney. It covers a very big area and diverse area. I mean, there’s heavy industrial land, expensive waterfront properties, rural subdivisions, bushfire prone land, national parks – in particular the Royal National Park, which is the second oldest national park in the world – was in the local government area that I worked in. So I saw lots of things and I was exposed to many, many different types of developments and lots of different scenarios with  habitat and the interface between residential subdivisions and bushland and quite a number of things, which  really gave me a pretty good grounding of environmental issues and planning issues.

Then  I spent a lot of time in court,  giving evidence as an expert in relation to the council’s prosecutions and merit appeals as well. So that all happened between the early eighties right through to the mid-90s. And I got to the stage where I enjoyed the court work and thought, well, you know, I probably should pursue this a bit further. And I ended up studying in the 90s and finished my law degree and my Master’s of planning degree in the late nineties, early 2000s. And then I got introduced to  a solicitor who was acting for the council in all these matters that I used to give evidence in. He asked me if I was interested in pursuing a career in law, and that was a very easy transition for me from town planning to law, and in particular doing the land environment court work. So that’s how it all started.

 

You have worked on some interesting cases in your career. What sort of cases are the most complicated?

I think the ones where you have multiple issues arising out of the contentions that are raised by a council. One of the biggest challenges that  lawyers face these days, especially with residential appeals on expensive waterfront land is the potential impacts that new developments have on other surrounding residents. Waterfront property owners tend to be very particular about losing views, which is natural. You understand that. So the challenges are always to try and deal with the client’s brief, but also be mindful of the impacts that the development may have on adjoining properties, be it, you know, overshadowing, view loss, privacy impacts from overlooking, all of those things. They’re a regular feature of the cases that are on waterfront land and sloping sites where there’s a lot of overlooking.

A waste recycler was an interesting case, where one of the primary issues was odour. We had to come up with a scheme of trying to suppress the odour from the waste. It was green waste, so the smell was pleasing to some but offensive to others. It’s more than just cut grass. It was piles of vegetation that ultimately boils down into compost runoff. That is then refined into fertilizer, and then that is bagged and then sold on to the retailers. That was a very challenging case. There are always challenges when you deal with those industrial matters, in particular waste, because the outskirts of Sydney, where this particular site was, with this growth of Sydney’s footprint expanding out to the western suburbs, it’s now in close proximity to residential premises where the odour was floating across the suburbs. So that was an interesting case.

 

Why is it important to see a Planning Lawyer before putting together a Development Proposal?

What happens is I see the project at the end of the process, and by that stage it sometimes can be a train wreck and, and you’ve got to get it back on the rails and into a shape that is approvable. So I’ve always been an advocate for getting involved in an earlier stage, and that’s probably a bit to do with the fact that I’ve got a planning background. I can see the pitfalls or the problems that have arisen during that journey without planning more input.

It’s a fact of life that a proponent will go and see an architect or a town planner or a consultant and decide to work up a development scheme absent of a planning lawyer’s input, only to find that it’s rejected by the council, and they’ve spent a lot of time and effort and money to get to a point where they’re all disappointed with the outcome. And then the only avenue left is, let’s look at an appeal to the court. And that’s when we can try and get things back on track.

It’s important that anyone putting a development proposal together understands the whole process. And where things can be improved to ensure that the pitfalls of having plans that don’t comply with planning controls, like local environmental plans or DCPS or any other planning principles that the court had handed down, are met through the paperwork that goes to the council. And a lot of the time, town planners and architects take it upon themselves to know all this information and, to their credit, a lot of them get it right. But there’s a lot that don’t. So ultimately, you get to a stage where there’s shortcomings within the proposal, which end up with a refusal from the council. And everyone spent months putting the proposal together, putting it through to the council, only to find out that there are big information gaps. So that’s where if they had perhaps come to a planning lawyer beforehand and involved that planning lawyer in the front end of the process, they would have understood the whole of the process and understood the requirements to get yourself into a position of an approvable development.

I think clients believe that lawyers are the last resort, and a costly resort, and that’s not always the case because you add value to the conversation up front, which then saves the money down the track. I think that’s probably the sentiment. They don’t think that they need a lawyer at this point in time.

 

What value do lawyers provide to the conversation about Development Proposals?

That’s a good question. From my own perspective, it’s about the relationship bill that you have with certain disciplines. Quite often it’s been the case where I’ve been able to do something that was not achievable through the council, where you completely turn the proposal around from a refusal to an approval, only to see the experts on the other side, or the experts that are working with you, or the client say, well, gee, um, I didn’t think that that was gonna happen, and why didn’t we talk to you earlier? So it’s about that experience that certain practitioners like planners and architects have, and engineers have with lawyers, and then they’re able to suggest to the clients that it might be a good idea to get a planning lawyer involved now, rather than later. That takes an education of the disciplines to understand the value that lawyers can provide.

 

What are the typical pitfalls of not involving a lawyer upfront with Development Proposals?

Again, this is one that happens quite a lot where applicants and proponents of development applications or proposals will spend an inordinate amount of time with a local council, and provide information after information after information to no avail, where they don’t get a result. In New South Wales, we have a deemed refusal period. So after a particular period of time, in this case 40 days, an applicant to a development proposal can take the matter to court.

Now, I’m not an advocate for pushing people through the court door, but by the same token, I cannot see why applicants spend an inordinate amount of time, 12 to 15 to 18 months waiting for an answer for a development proposal through a council or a consent authority. The court has that ability to determine the development application upon appeal. So depending on what the situation is with financing, and if you’re acting for a developer that has holding costs on sites, which are quite substantial, then the benefits are to get the matter out of the local council’s hands and put it in the hands of the court for the determination. That way you get more rigor in the process. And the court imposes timetables that have to be met by the parties. So there’s financial benefits in terms of time to have the matter dealt with by the court.

The planning system in New South Wales and Australia generally is quite complex and it’s quite easy to miss things. It may be the case that a previous use of the land was, say, an industrial use or a heavy industry use that caused contamination and that aspect hasn’t been properly considered and glossed over. So, that is a common one where I see that proponents would pay lip services the fact of the previous use. I’ll give you a good example: we recently did a case in a regional area where it was a retail shop that wanted to undergo a refurbishment and a refit to another use, but its previous life was a garage and a service station. Although the underground fuel tanks had been removed some time ago, there were still remnant contaminants within the soil. Whilst it would appear on its face that there wasn’t a problem, nonetheless there needed to be a report done to verify that there wasn’t a problem, and that held up the proceedings substantially. And of course that’s an extra cost to do a report or have a report done by a suitably qualified expert to verify that the contaminants are dormant or not toxic or pose a problem to the proposed use. That’s one example.

 

What are the tangible benefits of engaging a lawyer to take a Development Proposal to a Court of Tribunal for final determination?

There is tremendous value in having the lawyer involved in the whole project team from the get-go so you understand the strategy going forward. You put together a proposal that is well founded and properly prepared. And there’s a strategy in place in terms of timing, so the application goes in, it’s of a high quality, and then you wait a period of time, and depending on what sort of reaction you’re getting from the council – there are some councils that are very good at processing things quickly and getting an outcome, but invariably there’s a lot of bad ones that don’t have the staff to cover the amount of work that they’ve got to do, end up spending months and months and months where there’s nothing happening. Now, again, it comes back to what the holding costs are on the sites or even the increase in a 12-month period for building costs, with interest rates and the scarcity of trades to do work and also the cost of materials. If you could save six months, it may mean you get a start and your contract price is more palatable. I’ve heard that quite a lot where proponents will eventually get an approval, but they’re lumped with an extra impost on top because the delay has cost them another 50, 60, a hundred thousand dollars in costs. I always say yes. Again, it’s not to line my pocket, but rather to get a quicker outcome, because you do provide value to the overall project, and the amount of legal costs or the legal spend in the long run, it is commensurate with a project that should have been started earlier. If you let things linger in the council system – again, no fault of the council, but it’s just a fact of life – and the cost of developing the land has now gone up 10, 15, 20%, then the legal spend is really not as bad as you would think. So it would be wise to have a legal budget incorporated within the overall budget of the project.