Planning and Environment Law Update – [2026] QPEC 34
In Emerald Pharmacy Services Pty Ltd v Central Highlands Regional Council & Anor [2026] QPEC 34, the Planning and Environment Court held that a council delegate’s decision to approve a development application was legally unreasonable and invalid, because it lacked an evident and intelligible justification on matters material to the outcome. Kefford DCJ found the decision invalid and of no effect, to be set aside from the date it was made, with the application returned to the Council for reconsideration. It is a significant reminder that a development approval, including a code assessable approval given by a delegate, can be challenged and overturned on administrative-law grounds.
This is the latest chapter in a matter we have followed. In our enforcement article we covered the Emerald Pharmacy proceedings, in which the Court made interim and then final enforcement orders requiring a demountable pharmacy operating in breach of conditions at the Emerald shopping centre to cease unless a fresh development permit was obtained. A development permit for an extension to the shopping centre was then given, and it is that approval which the competitor, Emerald Pharmacy Services, has now successfully challenged.
Background
The land is the shopping centre at 51 Hospital Road, Emerald, described as Lot 91 on SP 314634. Quanta Holding Co Ltd, the centre owner, applied for a development permit for a material change of use and building work to authorise an extension to the centre. An earlier application had been refused. Following an appeal and a mediation, a second application was made, and on 25 August 2025 a delegate of Central Highlands Regional Council approved it, subject to conditions, as code assessable development. Emerald Pharmacy Services, a competitor, applied under s 11 of the Planning and Environment Court Act 2016 for a declaration that the decision was contrary to law and an order setting it aside. The proceeding is analogous to judicial review, and the applicant bore the onus.
The grounds
The applicant advanced several grounds, including that the decision lacked finality, sought approval for the wrong use, failed to give sufficient reasons, took into account an irrelevant consideration in the form of a mediation agreement, failed to assess against the Planning Act 2016 and the planning scheme, and was so unreasonable that no reasonable decision-maker could have made it. The Court found it convenient, and dispositive, to focus on legal unreasonableness, so it was unnecessary to decide the other grounds separately.
The Court’s reasoning
Applying the High Court’s analysis of jurisdictional error and materiality in LPDT v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2024] HCA 12, the Court held that the delegate’s decision lacked an evident and intelligible justification on aspects material to the outcome. The delegate’s report did not address a series of matters central to the acceptability of the approval, including the planning scheme’s definition of “shopping centre” and how the extension would integrate with the complex, the rationale for limiting the extension’s use to a pharmacy, and, importantly, why compliance with built-form design and landscaping conditions said to be integral to the acceptability of the use was deferred rather than required before the use commenced. The delegate’s oral evidence did not dispel the difficulty: the Court found he had sought to minimise his understanding of the binding nature of the mediation agreement.
On the sufficiency of reasons, the Court accepted there is an obligation under ss 63(4) and (5) of the Planning Act to give and publish a statement of reasons, reflecting the Act’s purpose of a transparent and accountable system of development assessment. It expressed reservations about, but declined to decide, whether compliance with that obligation is a condition precedent to a valid decision, noting that ss 71 and 231 of the Act may suggest otherwise and that the point had not been argued. The issue did not need to be resolved, because the inadequacy of the reasons instead supported the inference of legal unreasonableness.
On the mediation agreement, which had been entered into to resolve the appeal against the refusal of the earlier application, the Court found it unnecessary to decide whether it was an irrelevant consideration. It observed, however, that because the agreement sought to impermissibly limit the exercise of the discretion under s 60 of the Planning Act, it had serious reservations that the agreement could be a matter “relevant to the development.”
The decision
The Court held the challenged decision was legally unreasonable and invalid. It is to be set aside with effect from the date it was made, and the application returned to the Council for further consideration and determination according to law. The precise terms of the declarations and consequential orders were listed for a further hearing on 22 September 2026.
Why this decision matters
The decision confirms that a development approval can be set aside on administrative-law grounds where it lacks an evident and intelligible justification, and that this is so even for a code assessable approval given by a delegate. A statement of reasons is not a formality. It must genuinely explain why the decision was open on the assessment benchmarks and engage with the matters that drive the outcome, particularly where conditions are said to be integral to acceptability but their compliance is deferred. The decision also sounds a clear warning about mediation agreements: an agreement that commits an assessment manager to a particular outcome, or otherwise fetters the discretion under s 60, is problematic and may not be a relevant consideration.
Practical implications
For councils, a delegate deciding an application must give reasons that engage with the assessment benchmarks and explain the matters that drive the outcome; a decision that cannot be justified on its face is exposed to challenge, even where the development might otherwise have been approvable. For developers, resolving an appeal by mediation is common and useful, but an agreement must not purport to bind the council’s assessment, because conditions and outcomes remain a matter for the lawful exercise of the discretion. For submitters and commercial competitors, the decision confirms that declaratory relief under s 11 is available to challenge an approval affected by jurisdictional error, including legal unreasonableness.
A note on this update
This article is a general summary and is not legal advice. [2026] QPEC 34 determined the grounds of challenge. The precise declarations and consequential orders were to be settled at a further hearing on 22 September 2026. We can advise councils, applicants, objectors and competitors on the adequacy of reasons in development decisions, the limits of mediation agreements in development assessment, and challenges to the validity of planning decisions.
This publication is general in nature. Its content is current at the date of publication. It does not constitute legal advice and you should always seek legal advice based on your particular circumstances prior to making any decisions relating to matters covered by this publication. Certain details may have been sourced from external references, and we cannot assure the accuracy or timeliness of such information.