VCAT Volume 10 No 9
1. Change to planning scheme and the loss of review rights
What happens if you object to an application, seek a review at VCAT, participate in a hearing and then the planning scheme is changed that removes the third party right of review before the Tribunal decides the matter?
This was the scenario in Koneska v Greater Geelong CC (Red Dot)  VCAT 359. Telstra applied for a permit for a telecommunications tower, two objectors appealed to VCAT against Council’s NOD, and Amendment VC226 was gazetted prior to the Tribunal handing down its decision.
The effect of Amendment VC226 was to exempt permission for the use of land for a telecommunications facility and to remove notice, decision and review rights for the development of land for a telecommunications facility.
Telstra applied for an order that the proceeding be wholly dismissed as misconceived on the grounds that the permit application is now exempt from review rights with the consequence that the objectors no longer have standing to bring their applications and the Tribunal does not have jurisdiction to determine them.
The objectors submitted that, consistent with section 28(2) of the Interpretation of Legislation Act 1984 (the IL Act) and common law presumptions, their application under section 82 of the Planning and Environment Act 1987 (P&E Act) was an accrued right that was not affected by the amendment that introduced the relevant exemption. They submitted it was not affected because a contrary intention to affect the right did not expressly appear in the exemption.
One of the objectors’ grounds of appeal was that in the Supreme Court decision Von Hartel v Macedon Ranges Shire Council  VSC 215 it was held that the exemption did not affect their right to review the Council’s decision. However, the Tribunal considered that in Von Hartel the Court held that the effect of section 5 of the P&E Act was that the P&E Act must be read “so as to automatically pick up amendments to planning scheme” and that the Tribunal must have regard to and apply those amendments.
Further, the Court held a review right under section 82 of the P&E Act is “a bundle of rights … not limited to the right to lodge an application in the Tribunal [and includes] the right to have the application that has been lodged heard and determined in a particular way”. The Court went on to reject the Applicants’ ground as follows:
… were it necessary to decide I would hold that cl 52.06-4 [the exemption provision] applied in its amended form and that, in the absence of third party rights under other clauses, it removed rights flowing from s 82(1) of the PE Act, including the right to have the application for review heard and determined. [The ground] would not succeed.
Having regard to Von Hartel, the Tribunal dismissed the application as misconceived, stating that:
Having regard to the strongly persuasive authority of Von Hartel and having carefully considered the submissions of Ms Koneska opposing the dismissal application, I find the proceeding (ie both applications) is misconceived. I will therefore wholly dismiss the proceeding. The Tribunal is not required to make any further orders to finally dispose of the proceeding. 
- Guide to Planning Appeals: Accrued right
2. A fractious hearing involving existing use rights for a hotel
In Phelan v Port Phillip CC  VCAT 376, the Tribunal observed the three day preliminary hearing was one of the most fractious it had been involved in and stated “This type of preliminary hearing is already challenging enough in grappling at length with complicated legal issues, without the hapless presiding member also having to deal with extensive bickering between the parties.” One of the main issues of dispute was the order of submissions, which the Tribunal said should have been resolved at the practice day hearing.
The matter involved three questions of law:
- Whether, consistent with the Tribunal’s decision in Kevak Hotels Pty Ltd v Darebin CC (Corrected)  VCAT 318, by reason of the existing use rights afforded to the Middle Park Hotel, a planning permit is not required under Clause 52.27 of the Port Phillip Planning Scheme to extend the hours of trading, increase the number of patrons allowed and increase the area that liquor is allowed to be consumed or supplied.
- If the answer to question 1 is ‘yes’, whether the Respondents in application P1232/2022 have standing having regard to the effect of Clause 34.01-7 of the Port Phillip Planning Scheme.
- If the answer to question 1 is ‘yes’, whether the conditions under review in application P1232/2022 are validly included in the notice of decision. If the conditions are not validly included:
- whether the notice of decision must be amended, and
- whether any amendments must be made to applications P1168/2022, P1181/2022, P1205/2022 & P1232/2022.
On the first question, the Tribunal found that the vertical extent of the existing use right which the Hotel land enjoys includes the airspace immediately above the existing Hotel roof where the proposed rooftop deck would be located i.e. the ‘present use’ of the Hotel land includes this airspace.
At a more straightforward level, the Tribunal accepted that:
- It would be the same ‘hotel’ use occurring, with the proposed rooftop deck activity. The definition of ‘hotel’ is broad and the Tribunal already found that the Hotel as a minimum has existing use rights for the hotel activities occurring within the current external walls and roof, and accepted that the proposed rooftop deck would simply constitute an intensification of the same on-going use of the land for the purpose of a ‘hotel’.
- There were no planning scheme ‘height controls’ in play.
- There were no existing permit conditions or ‘notes on an endorsed plan’ which prohibit the proposed rooftop deck built form and activity.
The Tribunal’s finding was reinforced by the following statement in Seers v Macedon Ranges SC (Red Dot)  VCAT 1198 – “Existing use rights attach to land, not particular buildings on the land. Where land may be properly regarded as an integrated whole, it is not necessary to show that all of it is used for a given purpose”.
The Tribunal considered its overall finding on Question of Law 1 was consistent with the substance of the approach taken in Stonnington City Council v Southern Property Corporation Pty Ltd  VSC 435 and Patty Malonnes Bar Pty Ltd v Melbourne CC  VCAT 554. In those decisions, the Tribunal took a fairly robust approach to the vertical extent of the planning rights which the Tribunal found to exist with the buildings on each of the land in question.
On the second question, the Hotel argued it had the benefit of the Clause 34.01-7 third party exemption because:
- The footprint of the area of the proposed buildings and works only applies to the northern section of the subject land.
- Emphasis should be given to this footprint area, rather than the relevant title boundaries of the Hotel land.
- The southern edge of the footprint of the intended buildings and works would be over 30 metres away from the closest corner of the 255 Richardson Street property.
Clause 34.01-7 states:
Exemption from notice and review
An application to subdivide land or construct a building or carry out works is exempt from the notice requirements of section 52(1)(a), (b) and (d), the decision requirements of section 64(1), (2) and (3) and the review rights of section 82(1) of the Act. This exemption does not apply to land within 30 metres of land (not a road) which is in a residential zone, land used for a hospital or an education centre or land in a Public Acquisition Overlay to be acquired for a hospital or education centre. (Tribunal emphasis)
However, the Tribunal accepted that the most obvious and workable way to understand and apply the word ‘land’ is that the ‘land’ is all of the area inside the relevant title boundaries. Accordingly, subject to the proviso it identified elsewhere in its reasonings, the Tribunal considered it a “contrived and unconvincing approach to treat the ‘land’ as anything less than the relevant title area in question. This was consistent with the statement in APN Outdoor Trading Pty Ltd v Melbourne CC  VSC 8; at  that “Land is not developed for the sake of development but is developed for use”.
Question 3 was resolved with the consent of all parties.
The lengthy determination also provides analysis of key case law relevant to existing use rights and the consideration of important preliminary issues, including how to apply the concept of a ‘planning unit’; whether the Hotel, having regard to Seers, is not permitted to rely on existing use rights; general notions of ‘fairness’ in the operation of existing use rights otherwise prelude the Hotel from relying on existing use rights; and whether the Hotel as a minimum enjoys existing use rights in terms of the area inside its existing Hotel external walls and roof.
Hopefully, for the smooth operation of future hearings, the parties’ representatives take heed of the Tribunal’s comments about conduct.
- Guide to Planning Appeals: Existing use rights > Licensed premises, Hotel
3. A stiff question: is the temporary storage of dead bodies a warehouse or mortuary?
In Parsons Promenade Pty Ltd v Greater Dandenong CC  VCAT 401, the Applicant sought a declaration that the temporary storage of deceased bodies in a small cool room in the existing warehouse is part and parcel of the warehouse use for which no further planning permit is required.
The Applicant operated a budget funeral business and the warehouse is already used to store particular items associated with the funeral business – i.e. the storage of coffins, a hearse, funeral-related paperwork, etc. The business already has a mortuary in North Melbourne but does not own or lease any conventional funeral parlour where clients can come for meetings or where a funeral service might be held. Rather, the Tribunal was advised that the business hires internal spaces for funeral events/services on an as-needs basis, and the director of the business goes to see clients typically in the client’s home.
Noting that it was unfortunate that there is no planning scheme definition of a ‘mortuary’, reference was made to the Macquarie Dictionary definition of a ‘mortuary’, which is: “A place for the temporary storage of the dead”. The equivalent Oxford Dictionary definition is “A room or building in which dead bodies are kept, for hygienic storage or for examination, until burial or cremation”.
The Tribunal relied on the fact that the proposed Deceased Storage matches very closely with Nielsen v Handley Funeral Services v Baw Baw SC  VCAT 2040 where the use of ‘mortuary’ was separately noted and described as including the storage of deceased bodies. The facts are also similar to Aridas & Ors v Kingston CC  VCAT 2652, where the Tribunal accepted that the correct characterisation of the proposal was a ‘mortuary’, given the limited nature of the proposed activities which were described as follows – “The storage, preparation and transfer of dead bodies with no associated funeral services, viewings, visitors, meetings or gatherings of family or friends of the deceased”.
The Tribunal considered that it went against the Applicant‘s case that the dictionary definitions and the reference in Nielson to a mortuary as involving ‘the storage of deceased bodies’ point to the proposal here still constituting a ‘mortuary’, even if there is no embalming or other treatment of the bodies on the subject land. Likewise, the Tribunal considered Aridas as carrying weight, even if the permit applicant was not proposing to do any particular ‘preparation’ of the bodies of any deceased persons in this case.
In closing, the Tribunal acknowledged that the ‘budget’ style of funeral service in question was somewhat perplexing with how it interfaces with the Greater Dandenong Planning Scheme, in the sense that this business has no conventional ‘funeral parlour’ that the grieving family can some to in planning the funeral and/or have the funeral service at.
On the one hand, this might lead some people to question whether in practice the subject warehouse might at least occasionally be used more in the manner of a ‘funeral parlour’ e.g. if any clients came on to the subject land during the planning or carrying out of any one funeral.
On the other hand, the funeral operator was adamant that his business model involves only visiting clients at their own home. In addition Council was asking the Tribunal to do no more or less than make a finding that the proposed use should be correctly seen as a ‘mortuary’.
- Guide to Planning Appeals: Characterisation of use, Mortuary
4. Should an environmental audit statement be done before an application for permit is made?
In Anaya & Aarya Pty Ltd v Brimbank CC  VCAT 413, the Council refused an application for six dwellings with one of its grounds being that under the Environmental Audit Overlay an environmental audit should have completed prior to the lodgement of the application.
The subject site is part of a former City of Sunshine Landfill. The landfill was known to have accepted putrescible wastes with co-disposal of industrial wastes including paints, oils and solvents. The eastern portion of this site was part of what was known as quarry pit 4 and was backfilled as part of the City of Sunshine Landfill. The C212brim Explanatory Report notes that these properties may contain compacted and uncompacted fill imported from unknown origins and its composition unknown. The Explanatory Report states this fill, which may be related to the former landfilling and subsequent remediation, may be potentially contaminated.
Planning Practice Note 30 Potentially Contaminated Land states:
Generally, environmental assessment, including as appropriate a PRSA or environmental audit, should be provided as early as possible in the planning process. … Requiring an environmental audit as a condition of a permit may be acceptable if the responsible authority is satisfied that the land can be made suitable for its proposed use or development – i.e. that contamination will not preclude the proposal.
The Applicant also quoted from PPN30 that “requiring an environmental audit as a condition of a permit may be acceptable if the responsible authority is satisfied that the land can be made suitable for its proposed use or development – i.e., that contamination will not preclude the proposal”. The Applicant submitted this approach to resolving audit requirements via planning permit conditions has been “endorsed” by the Tribunal in Calodoukas v Moreland CC (includes Summary) (Red Dot)  VCAT 498, which stated:
However, what is reasonable at the permit application stage is that there be sufficient information for the Council to satisfy itself, at a threshold level, that there is no overriding contamination risk that cannot be managed and that might therefore warrant a refusal of the permit. If there is no such ‘showstopper’ issue, then all other issues of potential contamination can be dealt with by way of a standard permit condition (or under the Environmental Audit Overlay, if it applies).
In holding an environmental audit statement should be prepared prior to the lodgement of the application, the Tribunal stated:
I agree with the Council’s submission that this proposal can be described as a lower density development. It contains individual townhouses of one and two storeys with ground level open space areas. Also, the nature of the contamination affecting this site is about filled land where the compacted and uncompacted fill has been imported from unknown origins and its composition may be unknown. In contrast, the Calodoukas v Moreland CC proposal was for a higher density mixed use development of six storeys of a former petrol station. The Tribunal observed in that case that ‘most former petrol station sites are capable of being cleaned-up and converted for residential or sensitive use’. The Council points out it is much simpler for a higher density development to effectively ‘cap’ a potentially contaminated site with basement, ground level structure and/or manicured garden and then build above, e.g., residential apartments with balconies. So, I agree with the Council’s submission that the circumstances of this site and this proposal are not simple as a lower density development at least partially on top of a former landfill. Hence, it is not straight forward that a decision can immediately be made to impose a ‘standard’ permit condition simply requiring an environmental audit statement to be completed. 
- Guide to Planning Appeals: Environmental audit statement
5. Open space contribution and Section 18 of the Subdivision Act
In Farha v Darebin CC  VCAT 448, the Applicant appealed a condition requiring a 2% a public open space contribution for a two lot residential development.
The Applicant’s position was that as the Subdivision Act 1988 uses the term ‘each lot’ and not ‘either lot’, the exemption in section 18(8)(c) of the Act applies and no open space levy is applicable.
With respect to the interpretation of section 18(8)(c) of the Subdivision Act, the Tribunal stated:
Having regard to the purpose of and context of section 18 of the Subdivision Act 1988, I find that ‘each’ used in s.18(8)(c) of the Subdivision Act 1988 is most appropriately used as an adverb and therefore requires the Tribunal is to have regard to whether individually each lot to be created is unlikely to be further subdivided and if one is likely to be subdivided then the exemption does not apply and a public open space contribution may be required under s.18(1) of the Subdivision Act 1988.
I am satisfied that –
- having regard to the inclusion of the land in the GRZ1 and that there is no prohibition against proposed lot 1 being further subdivided according to merits, the planning scheme provisions that, it is not unlikely that proposed lot1 will be further subdivided; and
- the creation of proposed lot 1 will increase the need for additional or improved public open space having regard to the criteria in s.18(1A) of the Subdivision Act 1988. [25-26]
- Guide to Planning Appeals: Conditions, Public open space contributions
6. More on underdevelopment
We commented in our last editorial at VCAT Vol 10 No 8 on two cases where the Tribunal refused applications because of concerns with underdevelopment. These two cases are Investar Investments v Maroondah CC  VCAT 361 and CKRA Developments Pty Ltd v Banyule CC  VCAT 430.
In another case in Banyule, Planning & Design Pty Ltd v Banyule CC  VCAT 443, the Applicant sought a permit to construct four, two-storey dwellings on land in the Residential Growth Zone on a main road.
In refusing the application, the Tribunal stated:
I acknowledge that not every development site may be developed in a way that maximises the development potential provided for under the planning provisions and policies. The Planning Panel Report for Amendment C120bany includes discussion about the evidence of the Council’s urban design expert that three properties may need to be consolidated to achieve six levels and comply with the side setback requirements, and that a mix of heights between four, five and six storeys would be a more likely outcome. The strategic direction for the Postcode 3081 UDF area also anticipate these areas will include some medium density housing in addition to high density housing.
Despite this, I am not satisfied that this proposal is consistent with the degree of housing change sought in this location.
I am persuaded by the Council that “the proposal misses an opportunity to provide for higher density housing along a main road in a Residential Growth Zone in a manner that is not an acceptable response to the RGZ6 and DDO14 provisions”. I find that the proposal falls short of the degree of intensification and housing change sought for this area.
The proposal will provide a net increase of only two dwellings on the land and in a two-storey townhouse building form. The planning and policy context that applies to the subject land’s main road location anticipates a change to higher density and more intensive built form outcomes. The strategic directions for Postcode 3081 UDF area encourages innovative medium and high density housing to encourage urban renewal of the area. A development comprising only three, two-storey dwellings is reflective of a typical multi-dwelling townhouse development that could occur in many other residential zones within the municipality outside of the RGZ6, DDO14 and Postcode 3081 UDF areas. [42-45]
- Guide to Planning Appeals: Underdevelopment
7. Procedural fairness – unaccompanied site inspection
In George 21 Pty Ltd v Kilmore and District Residents and Ratepayers Association Inc & Anor  VSC 88, the Permit Applicant sought a permit for 14 dwellings in Kilmore in a General Residential Zone with no overlays. The Kilmore Structure Plan, an adopted reference document to the Mitchell Planning Scheme identified the site and the area around the Kilmore racecourse as an “equine precinct’.
Council refused the application on grounds including “does not respond to the existing character of the equine precinct.”
Before the Tribunal the Applicant called traffic and landscape evidence and argued that the area was, or would be, changing to a residential precinct as indicated by its zoning.
The Tribunal undertook an unaccompanied site inspection and in its written decision made findings of fact including that:
- there were horses on small areas of land without effective separation between the horses and the site
- thoroughbred horses can be easily spooked
- land opposite the site is used for treating sick horses that may already be stressed
- odours were evident
- equine activity begins early in the morning which may create potential noise impact on residential amenity
- feedstock would need to be transported adding to traffic that is not solely related or expected in a residential area
- equine activity reflects a visual character that is non-residential affecting visual amenity through clutter and patchy vegetation.
The Tribunal upheld the refusal on the grounds that the proposal was at risk from adverse amenity impacts associated with land use conflict between residential development and equine activities, and that the proposal didn’t satisfy its policy context.
The Permit Applicant appealed the Tribunal decision to the Supreme Court pursuant to section 148(1) of the Victorian Civil and Administrative Act 1998 on the ground of a denial of procedural fairness in failing to raise at the hearing, or before making its decision, the factual basis for, and the significance of, the consequences of the observations made during the site inspection.
In upholding the appeal and remitting the matter for re-determination by a different division of the Tribunal, the Court identified the following applicable principles:
- A decision maker should not make an adverse finding unless it has warned the person of the risk that it might be made, or the risk “necessarily inheres in the issues to be decided” Steen v Worksafe Victoria  VSCA 299
- This is distinct from a situation in which a party faces adverse evidence but chooses not to address it, from that in which a decision maker ‘takes into account some material or submission drawn from a source that is outside the knowledge or contemplation of the parties” Steen v Worksafe Victoria  VSCA 299 -984], Ucar v Nylex Industrial Products Pty Ltd (2007) 17 VR 492, .
- Counsel for the applicant submitted this case was “almost entirely on all fours” with Norville Nominees Pty Ltd v Strathbogie Shire Council  VSC 399.
- In Norville Nominees, the Court held:
- The Tribunal is entitled to treat its observations on a view as evidence in a proceeding;
- The obligation to afford procedural fairness does not necessarily require that a hearing be reconvened after a view is conducted;
- It does require that parties have a fair opportunity to meet the case adverse to them;
- When an expert tribunal does not more than utilise its general expertise, this will be in contemplation of the parties;
- If it goes beyond this and uses specialistic knowledge of particular factors of relevance, this must be disclosed to the parties;
- The Tribunal is not entitled to make a finding of material fact, based on evidence collected on its own inquiry, not disclosed to the parties, and which none of the parties have had the opportunity of investigating, testing or answering; and
- Judgement is necessarily one of fact and degree.
- It follows from the above, that the question in a case can depend upon the extent to which the risk that a determinative matter might come to be acted upon by the Tribunal could be said to be within the contemplation of the parties.
- Events in and relating to hearing preceding a “unaccompanied inspection” will often be of critical importance.
- In Griffiths v Shire of Hastings (1979) 59 LGRA 142, it was held that it would only be incumbent of a tribunal to notify parties of the results of an unaccompanied site inspection and give them further opportunity to call evidence or make further submissions, when some matter of significance not dealt with by the parties in the course of the hearing is revealed and upon which the Tribunal intends to base its determination on
- In Torrington Investments Pty Ltd & Ors v Shire of Bulla & Ors (1981) 57 LGRA 181, the Court considered an unaccompanied site inspection in which the Tribunal members conducted experiments on the effect of airplane noise on cattle and horses and held “What fairness requires will be affected by the nature of the fact in question and the course of the hearing before the tribunal, in addition, a sense of proportion must be retained. If the condition observed is unchanging and the observation is a simple one and the existence and significance of the condition have been canvassed during the hearing, I see no reason why the tribunal should not form its own impression during the inspection of such things as heights and distances and vistas and act on that impression without reconvening.”
- In that case, the Court referred to “the ordinary’s man’s notions of common fairness and commonsense” and questioned whether if parties had been present at the inspection and called further evidence and made submissions, whether the outcome would have been different. However, the Court determined “after considerable hesitation, and not without regret,” having regard to questions about the experiments that may have been raised by “importunate lawyer,” that the determination of the Tribunal should not be allowed.
- In Nathanson v Minister for Home Affairs (2022) 403 ALR 398, the High Court held that the appellant bore an onus of demonstrating that he or she had been deprived of “a realistic possibility of a different outcome.”
In considering the facts in this case, the Court examined the alleged seven “adverse and material findings of fact” having regard to the material before the Tribunal and the transcript.
The Court accepted that the reasons of the Tribunal distinguished between policy outcomes sought by the Scheme and the risk of “adverse amenity impacts associated with the land” and noted that Council’s case had focussed on the policy question.
The Court held that the potential for amenity impact issues and “reverse amenity” did emerge during the hearing through Council’s and objector submissions although the identified aspects of “reverse amenity” were not explored in detail.
The Court held that the degree to which reverse amenity issues emerged as “palpable and potentially relevant to the determination” was debateable on the face of the transcript, but that it was quite foreseeable that aspects of reverse amenity might become crystallised at the site inspection and the Applicant’s representative should have been alert to the potential. The Court did not accept that the Applicant was wholly “blindsided.”
However, the Court then held that the issue is a question of fact and degree, and that specific matters such as the dimensions of adjoining lots, presence of sick horses, odour and transport of feedstock could not be said to have “necessarily inhered” in the issues presented in the material before the Tribunal.
It was held that these specific and interrelated features went beyond observations in the nature of unchanging conditions, and each was a specific matter of relevance and significance. The issues should have been developed and addressed in evidence.
The issues bore directly and indirectly on the determination and the Applicant was deprived of the opportunity to adduce evidence and make submissions on these matters.
The Court stated that it was conscious that “once a material failure to accord procedural fairness is identified, it will ordinarily be difficult to conclude that it may not have affected the decision.” Norville Nominees, Torrington Investments.”
The Court held that “after considerable hesitation, and not without regret” it was satisfied that there was a realistic possibility that there might have been a different outcome if “the applicant had been afforded the opportunity to adduce evidence and make submissions concerning the whole of the specific and interrelated matters that arose out of the inspection.”
Leave to appeal was granted and the appeal allowed.
- Guide to Planning Appeals: Appeals > Site inspections
8. Whether a third storey addition exceeds mandatory building height
Clause 32.09-10 of the Neighbourhood Residential Zone specifies the maximum building height requirement is as follows:
- the building height must not exceed 9 metres; and
- the building must contain no more than 2 storeys at any point.
The provision contains various exemptions for buildings to exceed the maximum building height or contain more than the applicable maximum number of storeys.
Clause 32.09-10 contains the following exemption for an existing building which was relied upon by the Applicant in the proceeding Pacillo v Yarra CC  VCAT 435.
An extension to an existing building may exceed the applicable maximum building height or contain more than the applicable maximum number of storeys if it does not exceed the building height of the existing building or contain a greater number of storeys than the existing building.
In order to ascertain whether the proposal can rely on the exemption in Clause 32.09-10 for existing buildings, the Tribunal stated that it must ascertain the building height of the existing building and the number of storeys contained in the existing building.
The proposed buildings and works involved demolition of an existing roofed stairwell shaft on the roof terrace and the construction of a new third storey master bedroom addition.
On the height of the existing building, the Tribunal found that the maximum height of the proposed third storey addition is 9.53 metres above natural ground level and it was not in dispute that it would not exceed the building height of the existing building.
Whilst the Tribunal was satisfied that the roofed stairwell structure is the tallest point of the existing building, it must also be satisfied that the existing building contains three storeys which is a separate enquiry that requires an assessment to be made of the internal section of the building.
It found that the stairwell, whilst it included a ‘landing’, it was not persuaded that the landing area between the stairs and the door to the roof deck constitutes a third storey. As a result, the Tribunal concluded that the proposal to construct a third storey addition is prohibited by the maximum building height in Clause 32.09-10 of the planning scheme.
- Guide to Planning Appeals: Height > Meaning of storey