VCAT Volume 10 No 10

1. Internal amenity of townhouses

With the enormous growth of apartments from about 2010, there was increasing concern that, in the absence of any standards for this form of development, the internal amenity of many apartments was poor in terms of size, orientation, daylight and thermal comfort. The eventual approval of the Building Better Apartments Guidelines via Amendment VC136 on April 2017, and the subsequent updated Guidelines in 2022, has addressed many of the concerns.

The internal amenity of townhouses has not been of such general concern, though of course some long-standing standards have ensured reasonable amenity, particularly in relation to orientation, daylight and solar access.

In 459 Springvale Pty Ltd v Greater Dandenong CC [2023] VCAT 427, the Applicant for seven double storey and one single storey dwelling challenged a condition of permit requiring the deletion of the master bedroom and associated ensuite at ground floor for dwellings 1 to 6 (inclusive), and a reconfiguration of the living, dining and kitchen areas.

In requiring the condition, Council had regard to Clause 55.07 that sets out requirements for an apartment building and, in particular, standard B46. This standard sets out minimum internal room dimensions for living rooms (excluding dining and kitchen areas). Whilst acknowledging that this standard does not apply to a townhouse development, the Council submitted ‘it provides a tangible measure in assessing minimum internal room dimensions’.

The Applicant submitted the condition is:

… ineffectual as it cannot override the statutory authority of cl.62.02-3 of the Planning Scheme Ordinance where no permission is required for internal re-arrangement of a building with no increase in floor area and no resultant increase in the number of dwellings. That is to say that Condition 1.1 is ultra vires when tested against cl.62.02-2 of the Greater Dandenong Planning Scheme Ordinance.

It was submitted that Clause 62.02 sets out various exemptions from the permit requirements in this planning scheme. Clause 62.02-2 sets out the buildings and works that do not require a permit ‘unless specifically required by the planning scheme’. This includes the following:

The internal rearrangement of a building or works provided the gross floor area of the building, or the size of the works, is not increased and the number of dwellings is not increased.

The Tribunal was not persuaded by the Applicant’s submission. It stated:

The starting point is to understand the existing condition of the site and why a permit is required. The site currently has a single house on it. The proposal is to remove this house and build eight townhouses. The General Residential Zone states that planning permission is required to construct two or more dwellings on a lot.[5] Having regard to the quoted dot point from clause 62.02-2 above:

    • The proposal is for a new development with new buildings rather than rearranging an existing building, so that is one reason why this exemption does not apply; and
    • Even if the reference to building means both the existing and proposed buildings, the gross floor area and the number of dwellings is being increased, so that is another reason why this exemption does not apply. [17]

The Tribunal then pointed out that although there is no functional layout objective or standard in Clause 55 applicable to a townhouse development, there are other objectives and standards that already require consideration of the internal layout of the development either directly or indirectly. For example:

  • The dwelling diversity objective encourages a range of dwelling sizes and associated standard B3 suggests developments of 10 or more dwellings should including dwellings with a different number of bedrooms. Whilst this proposal provides less than 10 dwellings, the objective remains a relevant consideration. One way dwelling diversity can be demonstrated is by showing the internal layouts (and, in turn, the diversity in the design) of the dwellings;
  • The energy efficiency standard B10 encourages living areas to be on the north side of development and for developments to be designed so that solar access to north facing windows is maximised. Internal layouts will demonstrate this;
  • Overlooking by habitable room windows and the design of associated screening in standards B22 and B23 requires an understanding of where the internal rooms are and what they are used for (i.e., habitable or non-habitable). Internal layouts will demonstrate this;
  • Standard B24 requires consideration of noise sensitive rooms in new dwellings. Internal layouts will identify these;
  • The daylight to new windows objective and associated standard B27 refer to new habitable room windows. Internal layouts will identify these; and
  • The private open space standard B28 encourages convenient access from a living room. An internal layout will demonstrate this.

Hence, the Tribunal found:

These examples demonstrate the relevance of internal layouts to the planning considerations in clause 55 as well as to the planning policy aspirations for a high level of internal amenity. Applying the findings of the Court in Benedetti v Moonee Valley City Council [2005] VSC 434, the endorsement of plans under this planning permit PLN21/0172 and the undertaking of the development will mean that the townhouses are taking the benefit of the permit. In turn, this means the internal layouts are controlled by the permit as evidenced by the endorsement of floor plans that illustrate the internal layout of each townhouse. Any changes to the internal layout of these townhouses (units 1 to 6) such as to reintroduce a bedroom at the ground floor of townhouses 1 to 6 will require further planning permission. The Council submits (depending upon the circumstances of an amendment) this could be a section 72 amendment to the permit or an amendment by secondary consent in accordance with condition 3 of the permit. [20]

The Tribunal agreed with Council the internal layout was inadequate and the condition justified, that the open plan living areas in townhouses 1-6 were constrained due to the combination of their location within the ground floor amongst circulation points with limitations on their useability due to one or more factors of size, dimensions, inter-relationship with other aspects of the open plan arrangement, e.g., dining and kitchen arrangements. It dismissed the Applicant’s claim this is ‘Springvale, and not Toorak, Brighton or Armadale’.

Despite the Council’s success in this matter, the Tribunal awarded costs against the Council because, although Council made clear its concerns with the internal layout, evident from the information request, it did not explain the reasons for its decision and/or a position in a planning proceeding at the Tribunal. This resulted in an adjournment as the Applicant had to rewrite its submission.

Perhaps this matter could have benefited from a practice day hearing where such issues could have been raised and resolved.

Confined spaces require good design to ensure reasonable internal amenity and the Tribunal’s decision will no doubt be of interest to responsible authorities concerned with internal amenity for all townhouse development, not just apartment development.

See also:

  • Guide to Planning Appeals: Amenity > Internal amenity

2. Is a wind farm prohibited because it is located within 5 kms from residentially zoned land?

Schedule 1 of Clause 52.32 of the Latrobe Planning Scheme provides:

Land where a Wind energy facility is prohibited

All land within five kilometres of a residential zone, an industrial zone, a business zone or a special purpose zone in the urban areas of Moe, Morwell and Traralgon.

In Strzelecki Community Alliance Inc v Minister for Planning [2023] VSC 132, the local association challenged a decision of the Minister for Planning to approve the Delburn Wind Farm, comprising 33 wind energy turbines and associated infrastructure on 4,778 hectares of land owned by Hancock Victorian Plantations Pty Ltd.

The Minister called in the application under s 97B of the Planning and Environment Act 1987 (P&E Act), and referred the numerous objections and submissions received to a Panel appointed under section 97E of the P&E Act. (See Delburn Wind Farm (PCI) [2022] PPV 7). The Panel recommended approval of the Wind Farm.

The Plaintiff submitted that the proposal breaches the schedule to Clause 52.32 and the Wind Farm is prohibited. The following three questions were considered by the Supreme Court:

First, what is the relevant ‘land’ for the purposes of Clause 52.32? Is it the land on which the turbines and other infrastructure associated with the wind energy facility may be constructed under the permits, or is it the whole of the land to which the permits relate?

Second, what is meant by the ‘urban areas of Moe, Morwell and Traralgon’?

Third, is any of the land on which the wind energy facility is permitted less than five kilometres from the urban area of Moe?

The Court’s conclusions were that:

  • Only one part of the project area for the proposed Delburn Wind Farm is arguably within five kilometres of the urban areas of Moe, Morwell and Traralgon – a parcel of land at the north-eastern end of the project area, referred to as Lot 77. In this case, the relevant ‘land’ for the purposes of Clause 52.32 is the land on Lot 77 where installation of electrical reticulation is authorised by the permit. The permit does not authorise the use and development of any other part of Lot 77 as a wind energy facility.
  • Moe, Morwell, and Traralgon are three separate towns in the Latrobe municipality, each of which is registered with its own boundaries on the Register of Geographic Place Names. The three towns are treated by the Latrobe Planning Scheme as distinct centres, each with its own urban area, and not as a composite ‘Latrobe City’. While the Planning Scheme recognises that the two distinct urban areas of Moe and Newborough have joined to create a single urban settlement, the reference to Moe in the schedule to Clause 52.32 does not mean Moe-Newborough. The urban area of each town is delineated by the township boundary shown on the structure plan adopted for the town in Clause 11.01-1L of the Latrobe Planning Scheme.
  • None of the land on which the wind energy facility is permitted is less than five kilometres from the urban area of Moe.

See also:

  • Guide to Planning Appeals: Wind energy facility 

3. Should planning decisions be communicated by post, email, one or the other, or both?

Over the past five years there has been a paradigm shift with most communication between statutory authorities and their clients/customers by electronic means.

However, some authorities provide a hybrid system whereby communications are done by post and/or electronically.

In Harrison v Merri-bek CC [2023] VCAT 478, an objector claimed she had not received a Notice of Decision. Council had sent the NOD by post to an address on the objection form. As such, Council submitted that:

  • there was evidence that it gave notice of the NOD and thus did not fail to comply with the Planning and Environment Act 1987 (P&E Act) hence, the Applicants cannot rely upon section 87(1)(e) of the P&E Act;
  • the presumption of regularity should apply because Council can only rely on evidence of its normal notification processes;
  • there is no obligation to demonstrate that the NOD was received; and
  • the NOD was posted to the correct address provided by the Applicants in their objection.

The Tribunal observed that the process of using a residential address and serving by post for all forms of ‘formal communication’ and email for other types of correspondence is confusing and leads to inconsistent practice and unrealistic expectations. It stated that it may be prudent for Council to adopt a more modern approach for communication. For completeness, it also accepted the objector advised Council that she preferred correspondence by email rather than by post but that was advised after the issue of the NOD and not before (Tribunal emphasis).

Notwithstanding,  the Tribunal found on the evidence that Council complied with sections 64(1) of the P&E Act and thus, section 64(3) of the P&E Act. Further, it found that Council did not fail to give notice of the NOD and thus, the Applicants’ reliance on section 87(1)(e) of the P&E Act must fail. The Tribunal stated:

Whilst it seems that council did not provide original documents or the full chain of emails or even an audit trail from the relevant electronic file, I am satisfied on the balance of probabilities that council followed its usual process. This is because council relied upon the evidence of the planning officer that assessed the application and who was directly involved in the issuing of instructions to process and issue the NOD. To that end, this proceeding can readily be distinguished from Lucarano Pty Ltd v Monash CC [2021] VCAT 443 because in that case council’s evidence was based on a belief of the process rather than actual knowledge and further, there was no contention about receipt of the NOD. At paragraph 41, the Tribunal stated:

In this proceeding, there is uncontested evidence that the objectors did not receive the notice of the council decision to issue the NOD at the address provided for correspondence. There is no evidence before me to conclude that the council followed its usual process. The conclusion from Nick Sakolevas evidence is that he believes that the process was followed. Therefore, the presumption in this case is displaced. I note that the facts and circumstances in this proceeding are different to those in the Mandjian decision. Firstly, I note that in the Mandjian decision, some of the applicants acknowledged they had received notice of the application for planning permit. Secondly, the Mandjian decision did not consider the failure of the council to notify of its NOD. Thirdly, the analysis of the Tribunal with respect to section 145(2) and (3) of the PE Act was appropriate as the issue related to the council’s alleged failure to give notice of the application for planning permit and not a failure to give notice of its decision to issue a NOD;

The Tribunal also found the Applicants did not make their request to cancel the permit as soon as practicable after they had notice of the facts they relied upon in support of their request under section 89(1)(b) of the P&E Act.

See also:

  • Guide to Planning Appeals: permit > Application for permit > Notice

4. Suspension of EPA Operating License and Notice of Suspension held to be invalid

In SBI Landfill Pty Ltd v Environment Protection Authority [2023] VCAT 417, the operator of a landfill successfully challenged the decisions of the EPA to suspend its Operating Licence and to issue a Notice of Suspension (NOS).

The operator runs a landfill for solid inert waste which was granted by the EPA in March 2020. The EPA received complaints about odour emanating from the licensed premises and a fire had occurred in a stockpile located adjacent to the first cell. The odour was believed to be related to an increase in the leachate levels due to a dislodged leachate sump detector, but also understood to be in part due to the addition of the firewater that increased the generation of leachate.

There were four grounds in the application for declaration:

Ground One – the EPA failed to comply with the requirements in sections 60(2) and (3) of the Environment Protection Act 2017 (EP Act) in making the decision to suspend the operating licence under section 60(1) of the EP Act, and in issuing the NOS under section 60(4), and the EPA additionally failed to comply with the requirement in section 60(4)(b)(ii) by stating a period of suspension in the NOS which began before the notice was given.

Ground Two – the period of the suspension between 3 October 2022 and 30 January 2023 was arbitrarily arrived at by the EPA and a decision which no reasonable decision-maker acting reasonably could have made.

Ground Three – the EPA failed to comply with section 60(4)(b)(i) of the EP Act by failing to provide any, or any sufficient, reasons for the decision to suspend the operating licence for the period identified in the NOS.

Ground Four – the EPA’s conclusion that condition of the operating licence had been breached was legally unreasonable.

Only the first ground was made out, but that was sufficient for the Tribunal to suspend the Operating License and Notice of Suspension. On this ground, the Tribunal found that the EPA did not comply with section 60(2) of the EP Act because it did not provide SBI the 10 business days for a submission as required by section 60(2)(c) about the alleged breach of the leachate condition. Accordingly, the operator was not afforded a proper, statutorily defined opportunity to make submissions about the new alleged breach regarding leachate levels. Therefore, the operator was denied procedural fairness with respect to the alleged breach of the condition relating to leachate levels.

See also:

  • Guide to Planning Appeals: Environment Protection Act 2017

5. A different type of restrictive covenant: a restriction that prohibits signage which does not directly relate to the business activities on the land

Practitioners will be aware that most restrictive covenants on land are single dwelling covenants, or otherwise restrict the nature of materials of buildings.

In ROJ Property Group Pty Ltd & Anor v Eventpower Property Pty Ltd [2023] VSC 239, the Supreme Court considered an application pursuant to section 84(1)(c) of the Property Law Act 1958 to modify a covenant that prohibits signage which does not directly relate to the business activities being carried out by the transferee on the land.

The subject site is on a road that runs approximately parallel with the West Gate Freeway on its northerly side and to the east of the West Gate Bridge.

The Plaintiffs propose a modification as follows (new words underlined and previous typographical error struck through):

(d) any signage to be erected or displayed on the Land which does not directly relate to the business activities being carried out by the transferee on the Land or by a tenant or occupier of the Land or allow any third party signage (such as commercial advertising signage) to by be by erected or displayed on the Land;

The issue of the covenant had been subject to an earlier Tribunal hearing. In Eventpower Property Pty Ltd v Melbourne CC [2021] VCAT 1002, the Tribunal set aside a decision of Melbourne City Council for a permit to display the name and logo of a business operating on the land together with a slogan on part of the building facing the West Gate Freeway on the basis the proposed sign is prohibited due to the restrictive covenant. Specifically, the Tribunal held that because the proposed sign that was sought to be erected and displayed was not a sign that directly related to the business activities being carried out by the transferee on the land, because Symmetric is not the transferee of the land. Rather, the transferees are ROJ Property Group Pty Ltd and K & M Property Investments Group Pty Ltd. Although it could be argued that there was a relationship, of sorts, between K & M Property Investments Group Pty Ltd and Symmetric, in that one of the directors was involved with both companies, these are two different legal entities.

The Court agreed with the Tribunal in Eventpower Property Pty Ltd that the words of the restriction “directly relate to the business activities being carried out by the transferee on the land” must be given their ordinary and natural meaning, and that it was not possible to ignore the words ‘by the transferee’ and to conclude, as the Plaintiffs would have it, that the real import of the words is to restrict signage to that directly related to the business activities being carried out on the land, no matter by whom. The Court stated:

The presence of ‘by the transferee’ in the wording of the Signage Restriction makes it very difficult to construe it in the way advanced by the plaintiffs. It was contended by the plaintiffs that, properly construed, the Covenant permits tenants and occupiers of the Land to erect and display signage which directly relates to the business activities being carried out by that tenant or occupier on the land because the terminology embraces the business activity of letting the land to tenants. [64]

With respect to the proposed modification to the Covenant, the Court stated that it was clear that the signage restriction does not restrict the putting up and display of any signage (including advertising signage) on the land, provided it directly relates to business conducted on the land by the transferee (registered proprietor). If modified, as suggested by the Plaintiffs, it would still prevent the tenants or occupiers from displaying any signage relating to any business other than conducted by them on the land. It stated:

I also agree with the plaintiffs’ submission that the proposed modification will not result in any injury, let alone substantial injury, to those having the benefit of the Covenant. There is precious little difference between signage directly related to business conducted by tenants or occupiers of the Land and such signage directly related to business conducted by the registered proprietor. I fail to see any difference of substance at all. This is made obvious by the present signs displayed, which without exception comprise signage that does not identify the registered proprietor, but some other entity. I fail to see any detriment to the proprietors of the benefitted land, in their enjoyment of that land, that is ‘real’ arising from the proposed modification.

I further agree with the plaintiffs that the extension of the exception for business signage to tenants and occupiers will not facilitate artificial short-term leases and/or licences of small areas within the Land to occupiers whose real purpose is to erect commercial advertising, such as billboards, on the Land. [80-81]

See also:

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

6. Re-processing of mulch and storage of vehicles – characterisation of use

It may be recalled that in Kingston City Council v Mobius Materials Recovery Pty Ltd & Sylvania Anthony [2022] VSC 588, the Supreme Court concluded the Tribunal erred in law in not giving reasons as to why the proposed activity did or did not fall within the definition of ‘Materials recycling’.

The proposal considered by the Tribunal in the earlier proceeding was for the re-processing of mulch and the storage of vehicles on land in the Green Wedge Zone (GWZ). The Council had considered the proposal to be an Industry and therefore prohibited.

The remitted matter was considered by the Tribunal in Mobius Materials Recovery Pty Ltd v Kingston CC [2023] VCAT 575. A preliminary hearing was held to consider whether the proposed use of the subject land for re-processing mulch for use in agriculture is an innominate discretionary use, defined use or a prohibited use in the zone.

Council maintains that the reprocess of coarse timber mulch into fine grade mulch falls within the definition of ‘Industry’ and is prohibited under the GWZ. It submitted that the coarse timber mulch is a ‘waste’ or ‘waste material’ as there is no immediate market for the coarse mulch. If there was a market for the coarse mulch there would be no need for the further grinding; the coarse mulch contains contamination and the Applicant has not filed evidence demonstrating the sales of coarse mulch or fine mulch and provided analytical reports regarding its certification to Australian Standards.

The Applicant submitted that the land use terms contained in Clause 73.03 of the planning scheme are too general in nature and do not accurately reflect the activities to be undertaken in respect of the mulch. This was on the basis that the proposed use should be characterised as “re-processing surplus timber mulch which is to be subsequently sold and distributed to customers for agricultural purposes”. It submitted that the use of the site for a vehicle store is not contentious.

In the alternative, the Applicant contended that the activities could be characterised as ‘Materials recycling’ in conjunction with a ‘Transfer Station’. Further, it submitted ‘the proposed activity does not include any collecting, dismantling, storing, recycling, or selling of used or scrap construction and demolition materials. Although the surplus coarse timber mulch is derived from building waste, it is already in the form of clean mulch when it arrives at the review site. It cannot be said that the surplus mulch arriving on site is either scrap construction or demolition materials’.

The Tribunal concluded that the proposed use falls within the definition of ‘Materials recycling’, as it involves land used to ‘process refuse, used or surplus materials’. It stated:

The reprocessing of the coarse mulch brought onto the land into a finer grain mulch can be considered a form of process as what is intended to occur on the land is referred to as reprocessing. The coarse mulch brought onto the land is not in my view ‘refuse’ (that which is discarded as worthless or useless), nor is it ‘used’ (that has been made use of; used up completely consumed or exhausted). The coarse mulch can still be used in its coarse form. [56]

In adopting its approach, the Tribunal had regard to Cascone v Whittlesea Shire Council (1973) 11 AATR 175, where it was stated:

The ascertainment of purpose of a proposed use may yield the result that the purpose revealed very largely falls within a defined use. The extent to which it does not may be so trifling that it should be ignored. In that event the purpose as revealed should be taken to fall within the defined use.

See also:

  • Guide to Planning Appeals: Characterisation of use, Materials recycling facility

7. Rejection of compensation claim as it is not a direct consequence of the reservation

Amendment C187 to the Whittlesea Planning Scheme applied the Public Acquisition Overlay to 0.85 hectares strip of land to a property in Craigieburn Road. The owner of the land sought compensation under section 99 of the Planning and Environment Act 1987 (P&E Act) following the rejection of a subdivision application. At the time of the Amendment was gazetted, the owner had an option to purchase the land from original owner.

The compensation claim was considered in Greenwells Wollert Pty Ltd v Head, Transport For Victoria [2023] VSC 271. Prior to the full hearing, the Court made orders that the question of liability be determined separately from the question of the quantum of Greenwells’ claim. These orders were made because:

  • the question of liability can be determined without the need to address a significant amount of evidence filed by the parties directed to the quantum of the Respondent’s claim;
  • if the order had not been made there was a real prospect that the hearing scheduled to commence on 8 March 2023 would have been adjourned to accommodate the Respondent’s desire to file additional expert evidence.

The Court identified two issues for determination. First, whether the Respondent has standing to make a claim for compensation. Second, if the Respondent does have standing, whether any financial loss it suffered was a natural, direct and reasonable consequence of the reservation of 0.85ha of the subject land for a public purpose.

On the first matter, the Court held that the effect of section 102 of P&E Act is that assuming the original owner did have a right to claim compensation upon the sale of the land, this right did not extinguish the subsequent owner’s standing to subsequently claim compensation upon the refusal of its permit application. Rather, the quantum of any compensation payable to the subsequent owner must take account of any compensation already paid to the original owner.

On the second matter, the Court accepted the Respondent’s contention that the rejection of the permit application enlivened its right to claim compensation. However, it rejected the Respondent’s’ contention that any loss suffered by it as a result of not being unable to undertake residential development of the 0.85ha of the subject land reserved by PAO2 was a direct consequence of the reservation of the subject land for a public purpose. It did so because an applicant for compensation under section 98(1) must satisfy each of the three criteria – ‘ natural’, ‘direct’ and ‘reasonable’. The word ‘reasonable’ in section 98(1) connotes a reasonable response to the event triggering the right to compensation. It was not reasonable to award compensation in the circumstances because when it exercised its option to purchase the land it did so in the knowledge of the likelihood that the land available for residential development would be diminished by PAO2.

See also:

  • Guide to Planning Appeals: Compensation