VCAT Volume 10 No 1

1. Challenge to Minister’s decision on Westgate Tunnel spoil dismissed by Court of Appeal

In Melton City Council v Minister for Planning [2022] VSCA 144, the Council sought leave that the Supreme Court erred in Melton City Council v Minister for Planning [2021] VSC 700 in finding that the Minister’s Reasons did not contain an error of law on the face of the record, or alternatively, a jurisdictional error on the basis of the Minister’s reliance on the EPA approval, which was subsequently held to be invalid.

It may be recalled that the EPA initially approved Environment Management Plans (EMPs) for three landfill sites to take spoil from the West Gate Tunnel project, but withdrew these approvals in December 2020 after Supreme Court challenges by community groups. See also Hume City Council v Minister for Planning [2022] VSC 187 (editorial comment VCAT Vol 9 No 9)

Melton’s challenge was in relation the proposed disposal of spoil at the Melbourne Regional Landfill in Ravenhall.

Two permissions were required for the disposal of the spoil at Ravenhall: a planning scheme amendment and approval for an EMP under the Environment Protection (Management of Tunnel Boring Machine Spoil) Regulations 2020.

The Supreme Court rejected the Council’s case for two reasons. First, it concluded that, in the context of two independent and complementary regulatory regimes, the Minister’s reference to the EPA approval was merely a statement of fact that did not attribute, nor rely on, the legal character of the EPA approval.

Second, the Court held that, even if the Council succeeded in establishing the error of law for which it contended, the error was immaterial to the result. In that respect, the Supreme Court was not satisfied that there was a realistic possibility that the decision to exempt could have been different had the Minister appreciated that the EPA’s approval was invalid.

The essential question for Council in seeking leave to appeal was whether the decision to exempt from notice and the decision to approve were predicated upon the Minister’s belief in the lawfulness (and validity) of the EPA’s approval of the EMP.

In refusing leave, the Court of Appeal held that:

  • The Minister had no legal decision making authority in relation to the approval of the EMP. Accordingly, in deciding whether or not to exercise his own powers to exempt himself from the procedural requirements in the Planning & Environment Act 1987 and in making the decision to approve the amendment, the existence of an approved EMP was legally irrelevant.
  • Whilst the Council sought to overcome the absence of a statutory link between the two regimes by arguing that the existence of such a link might be relevant to the question whether the Minister had committed a jurisdictional error, the grant of relief in the nature of certiorari was discretionary. Hence, it would be difficult to justify the quashing of an administrative decision on the basis that the reasons given for it contain an incidental error of law which could not sensibly be said to affect the decision maker’s conclusion.
  • Moreover, the existence of two parallel regulatory regimes and the distinct decision making authority of the relevant entities made it considerably less likely that the Minister strayed into the legal territory of the EPA.

On the question of materiality, whilst the Court of Appeal held that it does not arise because the Council failed to establish an error of law, considered that no relief should issue because if there was a legal error it was not material to the decision. That is, there was no realistic possibility that the Minister would have made a different decision.

See also:

  • Guide to Planning Appeals: Planning schemes (Amendment to planning schemes) > Exemption from notice by Minister

2. Transitional provision applying to Clause 58 (Apartments)

Amendment VC174 was gazetted on 20 December 2021. The Amendment updated policy references to the 2021 version of the Apartment Guidelines, introduced a transitional provision within residential zone controls and made changes to the content of Clauses 55 and 58 (relating to objectives, standards and decision guidelines).

In Imax Land (Australia) Pty Ltd v Whitehorse CC [2022] VCAT 828, the Council and Respondents acknowledged the transitional provision in VC174 applied to the residential zone controls and Clauses 55 and 58. However, they argued that the transitional provision does not extend to preserving the provisions of Clauses 11.03-1S, 15.01-2S and 16.01-1S as they stood immediately before the approval date. These clauses pertain to activity centre policy, building design and housing supply.

The Council and Respondents contended that the effect of applying policies identified above was to make the Apartment Guidelines relevant to this proposal, notwithstanding the transitional provision in the zone controls. It was argued that the transitional provision does not extend to preserving the provisions of Clauses 11.03-1S, 15.01-2S and 16.01-1S in the Planning Policy Framework (PPF) as they stood immediately before the approval date, therefore these clauses now apply to the permit application.

On the other hand, the Applicant highlighted that policy is to be applied ‘as relevant’ and that because the transitional provision tempers the discretion of the decision maker, the policy which guides the discretion must also be tempered accordingly. It therefore submitted that by reason of the transitional provision, the new Apartment Guidelines are not relevant to this permit application. It suggested that:

…if Council’s interpretation is adopted, the [sic] transitional provisions would largely become meaningless, because the considerations which are ‘turned off’ through the transitional provisions would be applied through policy’.

Finding in favour of the Applicant’s submissions, the Tribunal held that a proper application of the wording of the transitional provision in Clause 32.07-5 in its context confirms that Clause 58 applies to the permit application given its date of lodgement, but that the content of that clause (in respect of applicable objectives, standards and decision guidelines) is as immediately prior to the introduction of Amendment VC174. (Tribunal emphasis)

The Tribunal considered it was important that the transitional provision does not provide a wholesale exemption from Clause 58. Transitional provisions could have been provided to preserve that part of the planning scheme but were not applied in this instance.

See also:

  • Guide to Planning Appeals: Transitional provisions > Transitional provisions under VC136

3. Did Council require notice to be given twice?

In BEG Projects Pty Ltd v Moreland CC [2022] VCAT 841, the Council challenged whether the application for review under the Planning and Environment Act 1987 was premature because the prescribed time in which to make an application had not expired.

On 17th March 2022, the Council sent correspondence to the Applicant indicating that it was preparing to give notice of the application by sending letters to surrounding properties and installing signs on the site. The correspondence attached an invoice for the cost of this and requested payment.

One week later, on 23rd March 2022, the Council sent an email requiring the Applicant to give notice via a newspaper.

Having paid the invoice, the Applicant argued that Council could not then on 23rd March 2022 require the Applicant to give notice. The Applicant submitted that once Council had made a decision to itself give notice, it cannot then change its decision as it is ‘functus officio’. In effect, it argued the Council was requiring the Applicant to give notice of a permit application twice.

The Tribunal disagreed with the Applicant’s contentions on the basis that [at 31]:

  • The obligation of an applicant in section 53(4) to pay the costs of a responsible authority in respect of notice is quite separate from the obligation of an applicant set out in section 53(2) to satisfy the responsible authority that it has given any notice it was required to give under section 53(1). There is nothing in section 53 which says that the obligations of the applicant to give notice under section 53(2) do not arise if the applicant has paid the costs of notice given by the responsible authority.
  • Section 52(1) does not involve a decision by a responsible authority to itself give notice of an application. Section 52(1) requires a responsible authority to give notice and no decision of the responsible authority is necessary before this obligation arises, section 52(1) itself creates this obligation. The letter of 17 March 2022 indicated that council was preparing to fulfil this obligation created by section 52(1).
  • What section 52(1) does allow a responsible authority to decide is whether to require an applicant to give notice. In this instance, the decision of the council to require the applicant to give notice of the permit application was communicated to the applicant once, via the correspondence emailed on 23 March 2022. The council has not at any stage sought to change this decision. Therefore, even if the applicant is right that the council could not change its decision to require it to give notice of the permit application, it has not sought to do so.

Whilst the Tribunal agreed with the Applicant that it is important for responsible authorities to aim to make the notice process as simple and as streamlined as possible so as to avoid confusion and ensure orderly progress of permit applications, the Tribunal did not consider section 52(1) should be read in a manner which prioritises this outcome over the very clear purpose of section 52(1) of ensuring that third parties, one way or another, receive appropriate notice of a permit application.

It also observed that a simple and streamlined notice process may well in some instances involve a permit applicant giving some forms of notice that are best able to be given by it (such as placing a sign on the site), while the responsible authority may be better placed to give other forms of notice (such as letters to adjoining owners and occupiers using the data from its rates record). It therefore stated that “It may therefore be contrary to the administration of simple and streamlined notice to read section 52 in the way suggested by the applicant”.

The Tribunal therefore summarily dismissed the application for want of jurisdiction and on the basis that it was misconceived.

As noted by the Tribunal, perhaps it is wise for responsible authorities to give notice requirements all in the one hit rather than by piecemeal and thus potentially create false impressions about the notice required.

See also:

  • Guide to Planning Appeals: Permit > Application for permit > Notice of application

4. Whether a restrictive covenant prevents more than one dwelling

In Camenzuli v Brimbank CC [2022] VCAT 832, the Tribunal considered an application for two dwellings on a site. Council supported the proposal but objectors contended the application should be refused because it breached a restrictive covenant preventing more than one dwelling being constructed on the land.

The restrictive covenant was somewhat unusual in that it made no reference to “no more than dwelling” but contained a number of requirements about the size and features of the ‘main building’ and the prohibition of subdivision.

Essentially, the Applicants submitted that the reference to ‘main building’, and the construction of the covenant as a whole, including a consideration of the context of the development of the estate and the intent of the parties at the time of entry into the covenant, all lead to an understanding that the covenant is intended to restrict development on the land to one dwelling only.

However, the Council submitted that in the absence of express wording it cannot be established that the covenant does more than set out the requirements for the appearance of buildings on the site, both main and other, and a prohibition on subdivision.

Further, the Council submitted that if the intention of the original parties was to restrict the number of main buildings or dwellings on the land, the covenant could have been drafted to make that intention clear. It was not. It followed that the covenant does not restrict the number of main buildings on the land.

Reference was made to the reasoning provided in Tonks v Tonks [2003] VSC 195 and in a recent decision of the Tribunal Two the Close Pty Ltd v Monash CC [2020] VCAT 1406. In that decision, the wording of the restriction was ‘any dwelling’ and the Tribunal reasoning for finding that this was not a single dwelling covenant included the following:

Whilst the understanding of the respondents is important to them, I must turn to the language of the restrictive covenant. I find that the use of the word ‘any’ in this restrictive covenant is used as an adjective and more particularly to mean ‘every’ rather than as a determiner of the number of dwellings. Further, if the intention of the restrictive covenant was to restrict the number of dwellings to be constructed on the subject site, the language used would have made that clear. The term ‘any’ that can have many different meanings would not have been used.

A legal letter from the Applicants provided to the Tribunal asserted that the application for two dwellings did not breach the covenant and that it was not proposed to subdivide the property.

However, in rejecting these submissions and concluding the covenant restricted the subject land to one dwelling, the Tribunal stated:

I agree with the submissions of the applicants that, when the Covenant is read in its totality, without using a technical or legal approach, and given the meaning that a reasonable reader would attribute, it becomes clear that the totality of the restrictions include that only one primary dwelling may be constructed on a lot. While not expressly stated, each of the restrictions is predicated on the understanding that there is only one primary residence on the lot. I say this for the following reasons. 

a) The first restriction sets out the materials for the main building and the second specifies that outbuildings, other than a garage, must have a floor area not greater than 6 square metres. This will clearly differentiate outbuildings from the main building which, in restriction (e), must be greater than 150 square metres in area

b) Restriction (g) does use the phrase ‘the main building’, confirming the relationship to the single main building on the land. It requires that ‘no flat or home unit shall be erected on the said Lot other than a flat or home unit erected for the purpose of housing an aged relative or friend of the occupants of the main building’. Restriction (h) then confirms that any flat or home unit must be removed when the land is transferred to a new owner.

Together with the guidelines about area and materials of the main building and outbuildings, this provides a clear indication that what is being sought is a single large brick (or similar) dwelling constructed on each lot with small outbuildings constructed of quality materials. Restrictions (g) and (h) then provide, essentially a loophole, for the occupants to house relatives or friends in a temporary ‘granny flat’ on the land if required.

It is clear that the flat or home unit is not to be confused with the main building on the lot. The legal advice provided to the permit applicant as well as the council’s submissions confirm that neither considers the proposed second dwelling on the land to be classified as a flat or home unit and both agree that a flat or home unit is intended to be a secondary and smaller form of housing.

c) Restriction (i) prevents subdivision of the lot. The council submitted that this restriction ‘only regulates density by preventing subdivision and therefore restricts multiple buildings on the land from being held in separate ownership’. Although it is possible to construct two dwellings on the lot and retain them in one ownership, a restriction on subdivision is consistent with and supportive of an intention to ensure construction of one dwelling only on each lot that is bound by the Covenant. [30]

Applying the principles of interpretation in Clare & Ors v Bedelis [2016] VSC 381, the Tribunal held that the covenant differs considerably from those in Tonks and Two the Close in that it includes ten separate restrictions which operate together to describe the form of development sought and restrictions imposed by the covenant. If the covenant included only restriction (a), with no further context, the Tribunal  would have interpreted it in a similar way to the other decisions referenced.

See also:

  • Guide to Planning Appeals: Restrictive covenant > Applications to remove or vary a restrictive covenant

5. Is beer and cider production a rural industry?

In Nolle v Ballarat CC  [2022] VCAT 874, application was made on land in the Rural Living Zone for the use of the land for a rural industry (nano-brewery and cider production); function centre (product tasting events); agriculture (horticulture); and to sell and consume liquor. Development (works) associated with the uses of the land (excluding crop support structures) were also proposed.

A key issue identified by the Tribunal was whether the beer and cider production could be considered ‘Rural industry’.

Council and Respondents made reference to Rainsbury v Bass Coast SC [2009] VCAT 2686 where the Tribunal held that the proposed brewery was not a rural industry. In Rainsbury,

  • The brewery commenced its beer brewing process with malted grain rather than malting raw grain. The Tribunal stated that a brewery which ‘malted its own grain’ could be characterised as a rural industry but ‘a conventional micro-brewery, which imports its malted grains from another processor, cannot be characterised as a rural industry’.
  • The processing of the hops with the wort was not an essential part of making beer, even though the hops (grown on the property) are an agricultural produce. The reliance of the applicant on processing the hops as part of the proposal was therefore not sufficient to characterise the use as rural industry because the substantial purpose of brewing (beer) is not the processing of hops but the ‘fermentation of the sugars’ extracted from malted barley.

In considering in detail the processes of production in the current proceeding, the Tribunal noted that the Applicant engages in a series of activities that processes grains, apples and other agricultural produce into intermediatory liquids containing the plant sugars that are then fermented and aged in barrels, the latter no doubt infusing some base flavours. The fermented liquors are then mixed with fruit, herbs, honey or similar agricultural produce for additional flavours, and blended to produce the final beer or cider for sale.

As such, the Tribunal considered the activities reflect an approach that is consistent with a brewer or cider maker controlling the quality and nature of the brewing and cider production process from commencement to end-product. In particular, it noted that the Applicant sources the necessary starting products, i.e. the grains, malted grains and apples. The initial processing of these products is then undertaken under contract by other processors because there is not enough on-site capacity to do so. The production of the wort is notably under the instruction or recipe of the applicant. Again, the Tribunal considered this is indicative of the overall control over the brewing process.

The Tribunal noted that the starting point in Rainsbury departed from the findings of Kemp v Bass Coast SC [2009] VCAT 2267, which adopted the position that a brewery is an ‘industry’ because it was a form of manufacturing. Kemp relied on the decisions in Reid v Port Phillip CC [2006] VCAT 226, Payne v Mitchell SC [2005] VCAT 2334 and Golding v Mornington Peninsula SC & Ors [2002] VCAT 415.

The Tribunal considered the key issue to resolve was whether:

  • First, as the beer and cider making processes commence off-site but are completed on the subject land by importing the wort and apple juice, is the land use processing agricultural produce?
  • If the answer to the first question is no, whether the adding of other agricultural produce, such as hops, honey, flowers and the like as proposed by the applicant is sufficient processing of agricultural produce to qualify the use as a rural industry?

It stated:

….. my earlier analysis identifies that the real and substantive purposes are land uses that involves a series of activities to make alcohol cider and beer with an initial starting point that involves the processing of agricultural produce. The purpose involves a continuum of processes that commences with agricultural produce and ends with the production of the alcoholic beverages. Such a purpose readily falls within the definition of rural industry. That the processes that support this purpose in this instance commence off-site, but necessarily under the control of the permit applicant, is a matter that is not trifling and cannot be ignored. It ties the purpose and hence the land use to the land. That said, the very important and necessary activities in this continuum of processing, i.e. fermentation and subsequent addition of other agricultural produce such as hops for flavouring, rely on and require the inputs of agricultural produce. [79]

The Tribunal granted a permit.

The Tribunal made its finding principally by examining the detailed processes of production. Parties should be aware that in any future cases in determining whether a brewery is a Rural industry will require very detailed submissions as to what is involved on a site in making a beer or cider.

See also: 

  • Guide to Planning Appeals: Rural industry

6. Is future development a relevant consideration in a subdivision?

The Tribunal, in Land Development Consulting Pty Ltd v Maroondah CC [2022] VCAT 936, has reaffirmed the principle pursuant to Clause 62.05 that the possible future development of land is a relevant consideration of a subdivision application. As stated in Butler v Maroondah CC [2016] VCAT 1212, which considered a proposed 6 lot subdivision on land elsewhere in the municipality, the Tribunal held [at 39].

The decision guidelines under Clause 65.02 are particularly instructive because they highlight the need to consider subdivision proposals not just as lines on a plan but also the consequences of the subdivision, including the development of each lot.

And as stated in McHugh & KG Goodeson and Associates v Shire of Eltham, the Tribunal said:

Decision making always involves a consideration of a consequence of the decision, decision making in the planning context must always be concerned about the present and future use and development of land.

Subdivision in most instances takes place to facilitate the development and use of the land, and it would be both artificial and unsatisfactory to consider the issue of subdivision without proper regard to the consequences of the use and development which would spring from the subdivision. …

This Tribunal is of the view that the future use and development of the land must be the primary consideration in applications for subdivision. The Responsible Authority and the Tribunal must be satisfied that the land is capable of being developed and used in accordance with the implication of the subdivision. The consequences of such considerations will vary from case to case. … However, in expressing this view the Tribunal does not say that the ambit of discretion in applications for subdivision is limitless, relevant considerations and the decisions/conditions which flow from them must reasonably relate to the subdivision and its real consequences in the context of the planning controls in the locality.

In Land Development Consulting Pty Ltd, a two lot application was proposed. A previous application for two dwellings had been refused. The Tribunal expressed concern, stating that “Significantly, by pursuing an application for a two lot subdivision, the Applicant has avoided planning scrutiny of many components of the original proposal to construct two dwellings on the lot.”

As to the proposed subdivision, the Tribunal was not  persuaded that the proposed plan of subdivision was capable of ensuring appropriate outcomes on the review site, consistent with the guidance provided by the Maroondah Planning Scheme. Specifically, it considered that:

  • the failure of the application material to provide any detail of the likely future siting and form of a future dwelling on lot 1;
  • limited space between dwellings for vegetation that conserves the existing landscape character;
  • insufficient room across both sites to replace established canopy trees; and
  • inadequate front and rear setbacks on lot 1, noting that generous front setbacks are a character of this part of the area.

See also:

  • Guide to Planning Appeals: Subdivision > Future development

7. Supreme Court dismisses appeal against supermarket and retail premises

It may be recalled that in ALH Group Pty Ltd v Kingston CC [2021] VCAT 459 the Tribunal set aside a Council refusal for a supermarket and retail premises on a site that included a hardware store that was to be demolished and a hotel.

In Ritchies Stores Pty Ltd v Kingston City Council [2022] VSC 495, a third party that operated an existing supermarket sought to challenge the Tribunal’s decision in the Supreme Court. Its grounds were that:

The Tribunal erred in law in finding that there was a lack of demonstrated significant social impact arising from the proposal, which raised two further questions:

  • Did the Tribunal fail to provide adequate reasons for its conclusion that there was ‘a lack of demonstrated significant social impact arising from the proposal’?
  • Was it unreasonable and/or seriously irrational for the Tribunal to conclude that there was ‘a lack of demonstrated significant social impact arising from the proposal’?

The second ground of appeal was that the Tribunal erred in law by concluding that there was an ‘absence of a permit trigger that connects the proposal with proximity to an existing gaming venue’. This was said to raise the following question of law:

  • Did the Tribunal misconstrue the [Planning] Scheme in reaching its conclusion that there existed no permit trigger that connected the proposal with proximity to an existing gaming venue?

The third ground of appeal was that the Tribunal erred by its concerns about the potential for convenience gambling and impacts for problem gamblers created by the location of the proposed uses near an existing gaming venue was not a reason to reject the proposal because of ‘the limited guidance provided’ in the Planning Scheme. The two questions of law related to this ground were:

  • Did the Tribunal misconstrue the [Planning] Scheme and fail to perform its statutory task in concluding that the Scheme contained ‘limited guidance’ with respect to a proposal to locate a supermarket and other retail uses proximate to an existing gaming venue?
  • Did the Tribunal fail to engage in an active intellectual process in considering whether to grant a permit for the proposal when it relied upon its conclusion that there was ‘limited guidance provided’ in the [Planning] Scheme as a reason not to reject the proposal despite its concerns about its proximity to an existing gaming venue?

On the first ground, the Court had no difficulty understanding how the Tribunal reached the conclusion that there was a lack of demonstrated significant adverse social impact arising from the proposal. The Tribunal accepted that the relationship between retail and gaming uses was relevant to discern “whether adverse social impacts associated with exacerbation of the risks of problem gambling are likely to arise”. It also accepted that spatial separation between the two uses was a planning measure commonly used to limit the encouragement of convenience gambling and its potential impact on problem gamblers.

On the second ground, the Court found that the Tribunal’s conclusion that a lack of significant adverse social impact had been demonstrated was a judgment that it was required to make about the possible social effects of the proposal. It considered the conclusion was logically informed by the evidence as to the possible gravity of the effect and the probability of its occurrence. It was open on the evidence and so was neither unreasonable nor seriously irrational.

In particular, the Tribunal was entitled to give weight to the detailed expert evidence given that the proposal presented a ‘low risk of problem gambling-related harm’.

On the third ground, the Court found that the Tribunal did not dismiss as irrelevant the proximity of the Hotel and the Tribunal’s related concerns about convenience gambling and potential impacts for problem gamblers. It just found that these matters were not determinative, for reasons including the absence of a permit trigger connecting the proposal with proximity to an existing gaming venue.

The Court considered the Tribunal was correct that there is limited guidance provided in the Planning Scheme. Specifically, it noted:

  • There is no local policy in the Planning Scheme concerning gaming generally, or specifically in relation to the location of other uses close to gaming venues.
  • Both gaming and retail uses may be permitted in the Commercial 2 Zone. Indeed, the use of land for smaller scale retail — supermarkets with a leasable floor area of no more than 1800 square metres, with adjoining shops with a leasable floor area of up to 500 square metres — does not require a permit.
  • The decision guidelines for the Commercial 2 Zone in Clause 34.02-7 direct attention to the effect that existing uses may have on the proposed use. They say nothing about locational separation of gaming from other uses that may be permitted in the zone.
  • Clause 52.28 applies specifically to gaming, with the purposes of ensuring that gaming machines are situated in appropriate locations and premises, ensuring the social and economic impacts of the location of gaming machines are considered, and prohibiting gaming machines in specified shopping complexes and strip shopping centres.
  • Clauses 52.28-4 and 52.28-5 enable the Council to designate shopping complexes and strip shopping centres in which gaming machines are prohibited. The Council has specified a number of shopping complexes and strip shopping centres in the schedule to Clause 52.28. However, there are other shopping areas in the City of Kingston in which gaming machines may be, or have been, installed. The expert’s evidence was that there are gaming venues in both the Mordialloc activity centre and the Chelsea major activity centre.
  • Under Clause 52.28-3, a permit is required to use or install a gaming machine in locations where they are not specifically prohibited.
  • Clause 52.28-6 enables the Council to specify guidelines relating to locations for gaming venues and machines. However, the Council has not provided any such guidelines in the schedule to Clause 52.28.
  • Clause 52.28-9 provides decision guidelines for an application for a permit under Clause 52.28-3. These include the compatibility of the proposal with adjoining and nearby land uses. No specific guidance is given about locational separation between gaming and retail uses, either in the body of the clause or as an ‘other matter’ specified by the Council in the schedule.

See also:

  • Guide to Planning Appeals: Economic and social impacts – Electronic Gaming Machines