D'Agostino v Greater Shepparton City Council - [2015] VSC 332

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
VALUATION, COMPENSATION & PLANNING LIST

S CI 2014 02910

RICHARD CHARLES D’AGOSTINO ROCKY PAUL D’AGOSTINO	Appellants
v
GREATER SHEPPARTON CITY COUNCIL	Defendant

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JUDGE:	ZAMMIT J
WHERE HELD:	Melbourne
DATE OF HEARING:	18–19 May and 15 June 2015
DATE OF JUDGMENT:	14 July 2015
CASE MAY BE CITED AS:	D’Agostino v Greater Shepparton City Council
MEDIUM NEUTRAL CITATION:	[2015] VSC 332

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ADMINISTRATIVE LAW – Appeal from decision of the Victorian Civil and Administrative Tribunal (VCAT) – Leave to appeal – Victorian Civil and Administrative Tribunal Act 1997, s 148 – Planning and Environment Act 1987, ss 69 and 81 – Whether the VCAT misconstrued the principles governing the exercise of discretion to refuse to extend a planning permit – Kantor v Murrindindi Shires Council (1997) 18 AATR 285 considered.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Southall QC Mr L Watts	Belleli King & Associates
For the Defendant	Mr R Appudurai	Russell Kennedy

HER HONOUR:

Introduction

This is an application for leave to appeal and, if leave is granted, an appeal from the order of Senior Member Rickards of the Victorian Civil and Administrative Tribunal (‘the Tribunal’) made 15 May 2014 under s 148 of the Victorian Civil and Administrative Tribunal Act 1997 (‘the VCAT Act’).

The proceeding concerns the decision of the Tribunal made under s 85(1)(f) of the Planning and Environment Act 1987 (‘P and E Act’) refusing to extend the time within which the Development approved under Permit 173/93 (‘the permit’) may be completed.

For reasons that follow I will grant leave to appeal. I consider the Tribunal made errors of law in relation to the submitted questions of law.

The applicants, Richard D’Agostino and Rocky D’Agostino, rely on the affidavits of:

· David Arthur Rewell, sworn on 19 June 2014 and 17 October 2014.

· Jason Earl Ventura, sworn 13 May 2015.

The Council relies on the affidavit of Andrew James Sherman, sworn 19 November 2014.

The parties also rely on written submissions.

Background

The D’Agostinos applied under s 81(1)(a) of the P and E Act for extension of the permit P173/93 originally issued by the responsible authority in 1994 for the development of the land as a road house service station, public toilet and bus terminal in three stages in accordance with the endorsed plans. The land is known as Lot 1, 309 Midland Highway, Shepparton East (‘the land’).

Between 1994 and 1998 the project was delayed. The permit was amended and extended by the responsible authority, the Greater Shepparton City Council (the respondent to this proceeding) on 23 February 1998 to include the use of the land as well as development (replacing an earlier separate permit for use) and also extending the permit.

On 20 March 2000 the Council extended the permit to expire on 23 February 2002. Since then, the permit has been extended a number of times by VCAT and by the Council.

On 16 June 2004 Senior Member RC Horsfall ordered that the time for completion of the Development under the permit be extended to 4 June 2006. Senior Member Horsfall acknowledged that work under the permit had commenced, namely road access works and drainage works in the road reserved, the installation of power and telecommunications in addition to sewerage already installed on site.[1] Senior Member Horsfall also observed that there were delays caused by the Council and drainage authority in endorsing drainage plans.
[1]D’Agostino v Greater Shepparton City Council [2004] VCAT 1154.

Consent orders made by Member Quirk on 12 October 2006 required the service station site to be raised by approximately 700 mm of fill and 150 mm of concrete.

In 2007 the D’Agostinos applied for approval of advertising signage plans, which were initially rejected by the Council.

On 8 May 2008 the Council extended the permit to 4 June 2009.

In August 2008 the Goulburn Murray Water transferred contract of its drainage management responsibilities to the Council. The D’Agostinos brought proceedings in this Court in relation to the transfer of the drainage responsibilities. On 24 October 2008 the Council endorsed the final amended drainage plans.

On 28 June 2009 the permit was extended to 4 June 2010.

On 21 July 2009 the D’Agostinos lodged with the Council an application for a building permit for Stage 1. The D’Agostinos were advised by the Council that all plans must be endorsed before the building surveyor would grant a building permit.

On 9 March 2010 the D’Agostinos sought details of the works undertaken by the Council to the 3/2 drain in 2009/2010 and how they would impact the land.

On 13 April 2010 the D’Agostinos’ landscape and signage plans were endorsed by the Council.

On 31 May 2010 a building permit was issued by the Council, requiring building works to commence by 31 May 2011 and conclude by 31 May 2013.

By May 2013, amongst other things, fabrication of 15 cages for the canopy in accordance with the specification set out in the building permit and cages for the signs were completed. The hold down bolts were also concreted. Steel was purchased for the canopy structure. On 9 September 2010, the permit was extended to 31 May 2013 to coincide with the aforementioned building permit.

At various times in 2010 VicRoads undertook upgrading work on Doyles Road which included raising the surface of the road, during which VicRoads removed the right and left turn lanes installed by the D’Agostinos and damaged the 20 metre cross-over. On completion the lanes were not reinstated and the damaged cross-over was not repaired. On 14 May 2010 and 26 November 2010, the D’Agostinos raised the question of reinstatement with VicRoads.

On 8 December 2010 VicRoads wrote to the D’Agostinos advising that some additional road works would be required adjacent to the land to reinstate pavement and line marking to its former state.

On 24 December 2010 VicRoads wrote to the D’Agostinos advising that it would reinstate the arrows and line markings on Doyles Road once the development of the land commenced. The works had been delayed to avoid any confusion to motorists by arrows pointing towards a vacant lot.

On 14 October 2011 the D’Agostinos wrote to the Council requesting a six month extension for the first stage of the building permit on the basis that even though the earthworks to elevate the site had been completed and drainage works had commenced, they were waiting for information from VicRoads regarding the duplication of the Midland Highway. On 18 October 2011 the Council agreed to extend the time for commencement under the building permit from 31 May 2011 to 18 April 2012. It did so in response to the request from the D’Agostinos on 14 October 2011 for a six month extension. The building surveyor specified that all building work was to be commenced by 18 April 2012.

On 14 November 2011 a panel hearing in relation to Amendment C148, which sought to impose a Public Acquisition Overlay on the land to be acquired on the northwest corner of Doyles Road/Midland Highway intersection, was conducted. On 15 December 2011 the Greater Shepparton Planning Scheme Amendment C148 Doyles Road Public Acquisition Overlay panel report was published.

On 18 April 2012 the D’Agostinos dug the foundation holes for two footings. Nothing further was constructed on the land.

On 14 June 2012 the gazettal of Amendment C148 occurred. The amendment now forms part of the Greater Shepparton Planning Scheme.

Between 27 February to 6 March 2013 there was the one in one hundred year flood event in the Goulburn Valley.

On 9 May 2013 the D’Agostinos sought from the Council a further extension of time from 31 May 2013 for two years for completion of the Development. On 16 May 2013 they were informed the Council would not extend the building permit.

On 23 May 2013 the D’Agostinos lodged an application with VCAT. At that time s 81 of the P and E Act provided a request to VCAT could be made if there was a failure by the responsible authority to make a decision within one month of the request.

On 30 May 2013 VicRoads responded to the Council’s email objecting to the extension of the permit.

On 17 June 2013 the Council advised that the development hearing panel had resolved that the Council’s position at VCAT will be not to grant the extension of time to the planning permit.

The Tribunal’s reasons

Before the Tribunal, the D’Agostinos submitted that the Development had commenced under the permit in a number of different ways, including:

(a)carrying out road construction as required by VicRoads under permit condition 16;
(b)raising and compacting the level of the site by approx 700 mm ready for construction;
(c)pouring two footings and installing drainage pipes, telecommunications and power to the site;
(d)incurring headwork charged for the connection of sewerage;
(e)constructing reinforced steel cages and hold down bolts on concrete pipes on the site; and
(f)purchasing steel for the canopy structure on the land.

The D’Agostinos argued that the delay in development on the site since September 2010 was due to a number of concerns. The Tribunal accepted this argument and acknowledged that those concerns were that the:

(a)Council could prevent access to a Council controlled 3/2 drain;
(b)Council works reducing the diameter of the drainpipe could nullify the approved drainage plan under the permit (and raise concerns as to the liability for water flowing onto nearby land); and
(c)the D’Agostinos had been attempting to clarify VicRoads plans for the intersection of Doyles Road and the Midland Highway.[2]
[2]Reasons [25]–[36].

Drainage issues

The Tribunal acknowledged that there had been an agreement between the D’Agostinos and Goulburn Murray Water as to drainage. The D’Agostinos had also been involved in litigation regarding the Transfer Agreement between the Council and Goulburn Murray Water regarding the 3/2 drain.[3]
[3]Ibid [38]–[42].

Involvement of VicRoads

The Tribunal noted that certain requirements were imposed by VicRoads pursuant to permit condition 16. Road works in Doyles Road were undertaken on 7 February 2003.[4] VicRoads upgraded Doyles Road in early 2010, subsequent to which the turning lanes and cross-overs installed by the D’Agostinos were not reinstated. VicRoads had advised that reinstatement works would begin once development under the permit commenced.[5]
[4]Ibid [49]–[50].
[5]Ibid [52]–[55].

On 14 November 2011 there was a panel hearing in relation to Amendment C148, which sought to impose a Public Acquisition Overlay over land to be acquired on the northwest corner of the Doyles Road and Midland Highway intersection. The Tribunal noted that despite having concerns about Amendment C148 and access to the Midland Highway, the D’Agostinos began to dig foundation holes for two footings on 18 April 2012, prior to the gazettal of Amendment C148 on 14 June 2012.[6]
[6]Ibid [56]–[60].

Once the building permit was issued, the D’Agostinos commenced fabrication work on cages for installation of the service station canopy, signs and other associated works. The D’Agostinos submitted that the works related to building structure being constructed on the land. The Tribunal considered that these works did not constitute part of the development of the land but demonstrated the D’Agostinos’ intention to slowly progress the permit.

The Tribunal found that nothing further had been constructed on the land other than two footings on 18 April 2012 in accordance with the building permit requirement that works commence by that date.[7]
[7]Reasons [66].

Kantor v Murrindindi Shire Council (‘Kantor’)[8]

[8](1997) 18 AATR 285 (‘Kantor’).

The Tribunal considered the relevant guidelines for a responsible authority in determining whether the time for commencement and completion under a permit should be extended. The guidelines were outlined in Kantor and the Tribunal noted that the matters identified in Kantor were not intended to be definitive requirements.[9] The Tribunal addressed the relevant applicable Kantor test and considerations as follows:

(a)whether there has been a change in planning policy;
(b)whether the land owner is seeking to warehouse the permit;
(c)intervening circumstances as bearing upon grant or refusal;
(d)the total amount of time;
(e)whether the limit originally imposed was adequate;
(f)the economic burden imposed on the land owner by the permit; and
(g)the probability of a permit issuing should a fresh application be made.[10]
[9]Reasons [67]; Minawood Pty Ltd v Bayside City Council [2006] VCAT 2097.
[10]Reasons [67]; Kantor.

Change in planning policy

The Tribunal determined that although land zoning had not changed since 2004, there had been changes to the Greater Shepparton planning scheme. These changes included the gazettal of Amendment C 148 and a different emphasis to be placed on transport and economic development, including the requirement to consider Freight Futures: Victorian Freight Network Strategy For A More Prosperous and Liveable Victoria (‘Freight Futures Document’).[11]
[11]Affidavit of Jason Earl Ventura sworn 13 May 2015, Exhibit JEV3; Reasons [68]–[74].

VicRoads and the Council submitted that if a new permit was sought, new conditions would be imposed in line with new policies and surrounding developments. One condition would be a requirement to obtain a permit to access the road in a Road Zone Category 1, subject to approval by VicRoads as the road authority.[12] The Tribunal accepted this submission.
[12]Reasons [74].

The Tribunal found that there was nothing to prevent the D’Agostinos progressing the Development. VicRoads indicated it would reinstate road works in Doyles Road and the Midland Highway, and the D’Agostinos’ ability to access the subject land from the Midland Highway had not been affected.[13]
[13]Ibid [76].

Warehousing

The Tribunal considered that the only works undertaken on the land since 2004 were the placements of fill pursuant to the Inundation Overlay and the digging of two footings in 2012.[14] The Tribunal found that the D’Agostinos had focussed on peripheral issues relating to drainage not on the land, and possible road changes, when road works required under the permits were completed in 2003. The Tribunal found that the absence of any significant progression of the Development indicated there has been ‘warehousing’ of the permit, despite various opportunities in 2010 to progress the Development to completion.[15]
[14]Ibid [78].
[15]Ibid [80].

Intervening circumstances

The D’Agostinos claimed that intervening circumstances since 2010 included VicRoad’s failure to reinstate road works it had previously undertaken and the indication that it may acquire the land for the intersection. The Tribunal found that these matters did not prevent the D’Agostinos proceeding with the Development.[16] The intervening circumstances did not deter the D’Agostinos from proceeding to dig the two footings immediately prior to the gazettal of Amendment C148 (notwithstanding concerns which had been raised before the panel).[17]
[16]Reasons [82]–[83].
[17]Ibid [87]–[89].

The Tribunal also rejected the argument that Supreme Court proceedings, regarding the transfer agreement, was an intervening factor, as the last decision in that matter was handed down in December 2011.[18]
[18]Ibid [90].

Further, the Tribunal did not consider that the D’Agostinos’ concern about the reduction in the diameter of the drainpipe, causing a potential flow of water, was founded. It found that such issues would not have hindered completion of the Development.[19]
[19]Ibid [91]–[92].

Total elapse of time

The Tribunal held that the D’Agostinos had not been prevented from completing the Development after the plans were endorsed when the building permit was issued in 2010. It considered that two years from 2010 was sufficient time to complete the Development.[20]
[20]Ibid [96]–[97].

Original time limits

The Tribunal did not find that two years was an unreasonable time limit to be imposed on the development of Stage 1 of the service station. This was especially given the endorsement of all necessary plans and the absence of impediment for the work to be progressed. In particular, the D’Agostinos had informed the Tribunal that if the permit were extended, the works could be completed in under two years.[21]
[21]Reasons [99]–[100].

Economic burden

The Tribunal found that while the D’Agostinos had spent a considerable amount, it was over a period of 15 years.[22] The D’Agostinos claimed that additional costs were incurred as a result of issues with drainage and VicRoads. The Tribunal considered these claims to be unfounded. In any event the Tribunal was of the view that it had not been provided with sufficient details on the matter.[23]
[22]Ibid [101]–[104].
[23]Ibid [103].

Probability of the issue of a new permit

The Tribunal recognised that a new permit would be issued by the Council and VicRoads. Permission is no longer required for the use of the area for the purpose of a service station. However, the development access to the service station would still require a permit. New conditions would therefore be required to alter access to and from the Midland Highway and to accommodate changes in policy.[24]
[24]Ibid [106].

The Tribunal considered that it would not be necessary to alter the drainage arrangements approved for development, other than some design detail.[25]
[25]Ibid [109].

Other matters: potential tenants

The Tribunal rejected the argument that discussions of potential tenants justified any extension of time.[26]
[26]Ibid [110]–[112].

Other matters: legitimate expectations

The D’Agostinos claimed that the failure of VicRoads to answer questions about the impact of road proposals and take certain steps in its consideration of its application for extension of time, denied them procedural fairness. The Tribunal rejected this argument.[27]
[27]Reasons [113]–[119].

Other matters: human rights

The Tribunal found that no human rights had been affected and that there is no mandatory imposition on the way the discretion under s 69 of the P and E Act ought to be exercised, as was suggested by the D’Agostinos.

Decision

The Tribunal ultimately refused to extend the time for completion of the Development. In the context of Kantor, the Tribunal concluded that the D’Agostinos had been warehousing the permit and may never complete the Development, particularly in the form permitted.[28]
[28]Ibid [129].

The Tribunal agreed that factors such as the elapse of time and planning policy changes, indicate that a new permit will be required. A new permit would impose appropriate conditions to take account of these changes.[29]
[29]Ibid [130].

The Tribunal did not accept the claim that drainage and the possibility of road works were reasons for failing to progress the Development. It found that claim to be unsubstantiated. The Council did not indicate that it would prevent drainage from the land into the drains under its responsibility. There was also no evidence that changes to the diameter of the drains would have impacted on the land unless in the case of flooding, which is not what the drains would prevent. VicRoads acknowledged that road works undertaken by the D’Agostinos would need to be reinstated, and there have been no other amendments or proposed amendments leading to a conclusion that the Development could not be completed due to these proposed road works.[30]
[30]Ibid [132].

The law
Principles relevant to leave to appeal from the Tribunal

The approach to the question of whether leave to appeal should be granted under s 148(1) of the VCAT Act was set out comprehensively in Secretary to the Department of Premier and Cabinet v Hulls.[31]
[31](1999) 3 VR 331 (‘Hulls’).

Not only must the applicant identify an arguable question of law, but it must also expose a vitiating error in the Tribunal’s decision. Phillips JA in Hulls’ case said:

Because an appeal under s 148 lies only on a question of law it follows that if leave is to be granted the applicant must at least identify a question of law (as distinct from a question of fact) and a question of law which is important to the appeal’s succeeding or failing. Thus, if the would‑be appellant seeks to have the order below set aside and reversed, the question of law must bear upon the granting of that relief. The question of law must be such that, if there is shown to be error in respect of the question, the appellant’s claim to relief will thereby be advanced.[32]

[32]Hulls [9].

The court may also refuse leave to appeal, notwithstanding the establishment of a prima facie case on appeal, if it is satisfied that to refuse leave would impose no substantial injustice.[33]
[33]Rule 4.09(2), Ch II, Supreme Court (Miscellaneous Civil Proceedings) Rules 2008.

In The Sisters Wind Farm Pty Ltd v Moyne Shire Council,[34] Emerton J concisely described the Court’s task as follows:

It is trite law that in exercising its review jurisdiction, the Tribunal does not review the propriety or legality of the decision made by the initial decision-maker. Its task is to ‘stand in the shoes’ of the original decision-maker and make the correct or preferable decision, having regard to the material before it. The review therefore takes place without any presumption as to the correctness of the decision under review. It is carried out on the basis of the facts and the law at the time the review decision is made.[35]

[34][2012] VSC 324.

[35]Ibid [40] (citations omitted).

In Mildura Rural City Council v VABDS Developments Pty Ltd,[36] Kyrou J summarised the approach to be adopted by the court in reviewing the decision of the Tribunal. His Honour summarised the approach as follows:

In considering whether the VCAT’s reasons for a decision disclose an error of law, the Court does not scrutinise those reasons over‑zealously with a view to finding error. Reasons for decision have to be read fairly and particular parts have to be read in the context of the reasons as a whole and the manner in which the parties conducted the proceeding. In reviewing the VCAT’s reasons for decision, the Court can have regard not only to what the VCAT expressly stated but also to the inferences that necessarily arise from what it expressly stated.

[36][2012] VSC 542 [40].

This approach requires the court to ensure, when reviewing the decision of the Tribunal, to consider the Tribunal’s reasons as a whole. In reviewing the Tribunal’s reasons, the judge must be careful to avoid turning an examination of the reasons of the decision maker into a consideration of the merits of the decision.

The Council submits that the questions of law which the D’Agostinos seek to agitate are not arguable, and even if they were arguable, do not expose any vitiating error in the Tribunal’s decision.

The Council submits that the approach adopted by the D’Agostinos is contrary to the approach set out by Kyrou J (as he then was) in Mildura Rural City Council v VABDS Developments Pty Ltd.[37] It is submitted that the D’Agostinos are inviting the court to consider the Tribunal’s reasons in a piecemeal fashion and out of context. Finally, it is submitted that even if the court finds that any of the questions of law raised by the D’Agostinos are arguable, refusing leave would impose no substantial injustice on the D’Agostinos, given the Tribunal found that a new permit would likely be issued, albeit subject to altered conditions.
[37][2012] VSC 542 [40].

The proposed amended notice of appeal (‘notice of appeal’)

The proposed notice of appeal filed 26 April 2015, contempates seven questions of law and 15 related grounds of appeal.

1A First question of law
Other than the time stipulated in s 69(1A)(a) of the P and E Act, is the discretion to extend time under s 69 (‘the s 69 discretion’) fettered or constrained by any consideration(s) of time?
1B Related grounds of appeal
Ground (i)
The Tribunal erred in finding that —
(a)a period of over two years from when all the Permit plans were endorsed was, in all the circumstances, ‘a sufficient time to complete the Development’ for the purposes of the exercise of s 69 discretion;
(b)the discretion conferred by s 69 was constrained, or fettered, by what the Tribunal considered to be ‘sufficient time to complete the Development’;

Ground (ii)
In its exercise of the s 69 discretion the Tribunal failed to have any or any proper regard to -
(a)the underlying need for, and basis of, the time extension for completion of the Development in accordance with the endorsed plan;
(b)the subject matter, scope and purposes of the P and E Act; and
(c)the policies and strategies of the responsible authority relevant to the Development, and any extension of the permit.(footnotes omitted)

The D’Agostinos submit that the Tribunal misdirected itself as to the nature and effect of s 69 of the P and E Act. It is submitted that the Tribunal erred in that it ‘appears’ to have adopted a temporal interpretation of s 69,[38] without having proper regard to the unfettered discretion as set out and applied by Ashley J (as he then was) in Kantor and Kyrou J in Mildura Rural City Council v VABDS Development Pty Ltd.[39]
[38]Reasons [93]–[100].
[39][2012] VSC 542 [42].

The D’Agostinos submit that the Tribunal erred in that it arbitrarily applied a limit of two years as ‘sufficient time to complete the Development’ without having proper regard to:

·the ‘particular circumstances relevant to the consideration to extend time’;[40] or

· the subject matter, scope and purpose of the Act; or
· the underlying basis and need for the extension.[41]

[40]Kantor, 309.

[41]Peninsula Junction Pty Ltd v Mornington Peninsula Shire Council [2013] VCAT 2169 (23 December 2013).

The parties agreed the principles which a court or tribunal must apply when exercising a discretion conferred by statute were those conveniently summarised by Kyrou J in Mildura Rural City Council v VABDS Developments Pty Ltd.[42]
[42][2012] VSC 542 [42].

The relevant sections regarding the total elapse of time and whether the limit originally imposed was adequate, were discussed at paragraphs 93 to 100 of the Tribunal’s reasons.

I consider the Tribunal appropriately addressed the issue of the time elapsed since the last extension of time for completion. In doing so, the Tribunal carefully acknowledged the scope of the matters identified in Kantor and then found that more than two years after the grant of the building permit was adequate for the completion of the Development. The Tribunal did not arbitrarily impose a temporal limit. It considered the time that had elapsed, what was done in that period, including the D’Agostinos’ claims in relation to delays they allege were caused by the drainage and VicRoads issues, Council’s alleged misconduct in responding to correspondence, the economic burden on the D’Agostinos and other relevant matters including potential tenants, legitimate expectations and human rights.

In doing so the Tribunal found that more than two years had been sufficient time for the completion of the Development. I consider the D’Agostinos are doing no more than attacking the Tribunal’s finding that two years allowed in 2010 was adequate and sufficient time in all the circumstances to complete the Development.

I accept the Council’s submission that there is nothing in the reasons which indicates that the Tribunal adopted an arbitrary two year time limit as a fixed criterion upon which any decision on the extension of time sought by the D’Agostinos ought to be decided. The D’Agostinos’ submission focuses on paragraphs 93 to 100 of the reasons and fails to consider the reasons as a whole.

2A Second question of law
In the exercise of a s 69 discretion, did the Tribunal take into account all relevant considerations relating to the exercise of that discretion?
2B Related grounds of appeal
Ground (iii)
In its Reasons the Tribunal failed to consider, whether properly or at all, the following matters relevant to the exercise of the s 69 discretion:
(a)In the period from 5 September 2010, substantial works were carried out pursuant to the Permit;
(b)In the period between September 2010 and May 2013 (‘the said period’) Building Works including the offsite fabrication works were carried out by the Appellants in furtherance of the Development;
(c)The economic and financial burden borne by the Appellants in carrying out the Building Works during the said period, in furtherance of the Development;
(d)The economic and financial burden borne by the Appellants in carrying out the Development;
(e)The provisions of the ‘Shepparton 2030 Strategy’ and the ‘Shepparton Municipal Strategic Statement’, being mandatory requirements for consideration by Council’s delegate in the exercise of the s 69 discretion;
(f)Council’s failure to respond to the Appellants’ enquiries concerning the impact of the approved drainage plans of Council’s works to the 3/2 drain;
(g)Council’s misconduct and/or maladministration of the permit process;[43]
(h)The need for the Appellants to proceed with care, or ‘hasten slowly’, in completion of the Building Works, given the Council’s prior pattern of delay, destruction, non-response, and acts in ‘stalemating’ the progress of the Development.

Legal principles in relation to the review of an exercise of discretion

[43]RP and RC D’Agostino v Greater Shepparton City Council [20104] VCAT 1154 (Senior Member RC Horsfall) and RP and RC D’Agostino v Greater Shepparton SC [2006] VCAT 2008 (Member Quirk).

An exercise of discretion by the Tribunal involves an error of law if the Tribunal failed to take into account a matter that it was bound to take into account, if the Tribunal took into account an irrelevant consideration, or if the Tribunal’s exercise of discretion was ‘manifestly unreasonable’, in the sense that no reasonable decision maker could have exercised the discretion in that way.[44]
[44]Bell Corp Victoria Pty Ltd v Stephenson (2003) 20 VAR 280; [2003] VSC 255 (Ashley J).

In McKinnon v Cowban,[45] Osborn J stated that it is not sufficient on an appeal on a question of law to suggest that it is possible an inferior tribunal erred in law because the terms of the reasons do not address all the arguments now put to the court. It must be shown that the tribunal was guilty of a vitiating error of law.
[45][2004] VSC 380.

A ground of appeal alleging that the tribunal erred in law by giving excessive or too little weight to a particular matter, does not give rise to a question of law.[46] This type of ground suggests that the applicant wants to reargue the merits of their claim in the Supreme Court, and this is not open on appeal under s 148 of the VCAT Act, as it is confined to a question of law.[47]
[46]Tomasevic v State of Victoria [2005] VSC 402, (Smith J) [42].
[47]Luck v Renton & Ors (2005) 24 VAR 1; [2005] VSCA 210 (Maxwell P and Harper AJA).

The fact that the Tribunal gave a matter more or less weight than the plaintiff would have liked, is not an error of law. The relative weight to be given to particular factors bearing on the exercise of a discretion, does not raise a question of law unless the conclusion reached is not reasonably open.[48]
[48]Psychology Board of Australia v Mair [2010] VSC 628 [61].

Justice Ashley in Pong Property Development Pty Ltd v Strangio[49] stated that the court should be ‘very reluctant indeed’ to conclude that a decision of the VCAT, which involved the formation of an opinion and the exercise of discretion, was so unreasonable as to be untenable.

Grounds of appeal (iii)(a) and (iii)(b):
· In the period prior to September 2010, substantial works were carried out pursuant to the Permit.
· In the period between September 2010 and May 2013 (the ‘said period’), Building Works included the offsite fabrication works which were carried out by the Appellants in furtherance of the Development.

[49][2005] 23 VAR 128 [57].

In oral submissions, counsel for the D’Agostinos, referring to Question of law 2(A), grounds (iii)(a), (iii)(b) and (iv)(c) (which I will deal with later), said that the ‘learned senior member didn’t place any or any sufficient weight on … it’s conceded she did mention it in the reasons but she failed to place sufficient weight on it for the purposes of the exercise of the section 69 discretion and it’s not the only matter’.[50]
[50]Transcript 15 June 2015, 15, LL 14–18.

In relation to ground of appeal (iii)(a), I do not consider the Tribunal failed to take into consideration the works done prior to September 2010. The Tribunal did not attribute the significance or weight to this work as submitted by the D’Agostinos. This is not an error of law.

The Tribunal looked at the events that occurred from 2004 and 2010. The Tribunal accepted that there were intervening circumstances that gave rise to extending the completion date until May 2013.[51]
[51]Reasons [33].

In relation to ground (iii)(b), given the Tribunal’s failure to take the offsite fabrication work into consideration in the exercise of the s 69 discretion, I consider that the Tribunal erred in not taking into consideration offsite fabrication works between September 2010 and 2013, in furtherance of the Development.

Grounds of appeal (iii)(c) and (iii)(d):
· The economic and financial burden borne by the appellants in carrying out Building Works during the said period, in furtherance of the Development
· The economic and financial burden borne by the appellants in carrying out the Development.

The D’Agostinos submit that apart from a reference to costs at paragraph 102 of the Reasons, the Tribunal failed to give adequate weight to costs incurred prior to 13 September 2010, and also failed to take into account the economic burden of the costs undertaken and incurred subsequent to 13 September 2010.

In relation to the costs and works undertaken prior to 13 September 2010, the D’Agostinos submit that the Tribunal’s reference at paragraph 104 of the reasons was dismissive and failed to adequately take into account that factor. Of the matters complained of, the D’Agostinos submit that the Tribunal failed to properly take into account in the pre-13 September 2010 period:

(a)road works required by condition 16 of the permit having been completed;
(b)$85,000 to $95,000 in expenses incurred on the road works and cross-overs in Doyles Road;
(c)$10,000 to $20,000 paid to VicRoads in respect of works in the Benalla Road;
(d)approximately $80,000 incurred in lifting the service station site by 700 mm;
(e)approximately $7,000 spent on electricity and telephone connections;
(f)$90,000 paid to Goulburn Valley Water for sewerage head works charges; and
(g)approximately $16,000 spent on purchasing 450 mm and 600 mm pipes for the drainage.

In relation to the said economic burden amounting from the works undertaken and costs incurred subsequent to 13 September 2013, the D’Agostinos submit that the Tribunal’s reasons demonstrate that these expenditures were not considered at all by the Tribunal and that as such, this represents an error of law. The considerations which the D’Agostinos say were not taken into account by the Tribunal, despite such matters being before the Tribunal in the appellants’ written submissions, include:

(a) approximately $30,000 spent on purchasing steel for the roof of the canopy;
(b)approximately 180 hours of labour expense incurred in cutting base plates and building cages;

(c)         fabrication of all 15 cages for each of the columns supporting the apron;
(d)      fabrication of all ten cages for the signs;
(e)        the back two cages which were installed with the associated concrete footings;
(f)          fabrication of bolts for signs, and footings; and
(g)        materials for the columns and trusses purchased.

The D’Agostinos submit that the costs incurred in relation to the cages is relevant as they were constructed to meet the specification in the building plan.

The Tribunal considered the economic burden on the D’Agostinos in carrying out both the Building Works from May 2010 and in furtherance of the Development. However, the Tribunal concluded that the amount expended by the D’Agostinos, while considerable, was spent over the last 15 years, that is the life of the permit, and not just in recent years.[52]
[52]Reasons [104].

The Tribunal also considered the Building Works from 31 May 2010 at paragraph 64 of the reasons. The difficulty is that because the Tribunal concluded that the Building Works were not undertaken on the land, the Tribunal did not consider these works constituted part of the Development. The Tribunal acknowledged that the offsite Building Works referred to in paragraph 64 of the reasons, indicated the D’Agostinos’ ‘intent to progress the permit, albeit slowly’. At paragraph 78 of the reasons, the Tribunal again acknowledged the significance of the steel caging but then disregarded it on the basis that it was offsite.

While the Tribunal took into consideration the economic burden, I consider the Tribunal erred in not taking into consideration in the exercise of the s 69 discretion, the economic burden of the offsite Building Works, particularly in circumstances where the Tribunal found these works indicated an intent by the D’Agostinos to progress the permit. It may well be that, had the Tribunal taken these matters into consideration, it may have tipped the balance in the exercise of the s 69 discretion in favour of extending the permit.

Ground of appeal (iii)(e)
· The provisions of the ‘Shepparton 2030 Strategy’ and the ‘Shepparton Municipal Strategic Statement’, being mandatory requirements for consideration by Council’s delegate in the exercise of the s 69 discretion.

The D’Agostinos submit that the Tribunal made an error of law in that it did not take into account the provisions of the Shepparton 2030 Strategy and the Shepparton Municipal Strategic Statement (‘SMSS’).

There was disagreement between the parties as to whether or not the Tribunal was in fact a delegate for the purpose of the SMSS. Putting aside this point, the D’Agostinos’ real complaint is that the Tribunal erred in that it failed to take into account the matters referred to in these two documents. It is submitted that in the exercise of the discretion under s 69, it was mandatory for the Tribunal to have had consideration of the matters in these documents.

The real problem with this submission is that the D’Agostinos have not established that the Tribunal’s failure to take these matters into consideration has adversely affected the D’Agostinos’ application for an extension of time. The submission simply asserts a failure to have regard to these documents and the matters contained within these documents, but does not articulate how that failure is or could be a vitiating error. In oral submissions counsel for the D’Agostinos referred the court to various sections in both documents and then concluded:

So we say that the learned member at 2.7 fell into error in not taking into consideration Council’s Shepparton 2030 strategy in the municipal strategic statement being the factors which given the exercise of the section 69 discretion in the context of the subject matter, scope and purpose of the Planning Act, harking back to the words of his Honour Justice Ashley and the relevant provisions of the Local Government Act …[53]

The submission goes no further.

[53]Transcript 15 June 2015, 22, LL 19-24.

It was submitted on behalf of the Council that the Tribunal properly considered all relevant applicable policies under the scheme, including the effect of transport policies which had been altered since the last extension of time. The Council submitted that ss 60 and 84B(2)(a) of the P and E Act properly set out the matters which the Tribunal must take into account, which includes any relevant planning scheme. The Council submitted that the Tribunal took into account, at paragraphs 68 to 76 of the reasons, the relevant planning schemes and policies, in particular the SMSS and the Greater Shepparton planning scheme.

Even if the Tribunal did not have specific regard to the Shepparton 2030 strategy and the SMSS, and even if it was mandatory, the submission fails to provide any basis on how these documents affected the exercise of the Tribunal’s discretion. There is no evidence before the court of what difference these documents would have made to the Tribunal’s ultimate decision. I consider that the D’Agostinos have failed to establish that the error at law, if any, is a vitiating error or would have made any significant difference to the outcome.

Ground of appeal (iii)(f)
· Council’s failure to respond to the Appellants’ enquiries concerning the impact of the approved drainage plans of Council’s works to the 3/2 drain.

I will not repeat the D’Agostinos’ submissions which are conveniently summarised at [2.8] to [2.26] of their written submissions dated 10 April 2015.

At the heart of the submission was the complaint that the Council failed to respond to two letters from the D’Agostinos dated 9 March 2010 and 30 April 2010 in relation to the potential impact of the Council’s Doyles Road drain relocation works on the D’Agostinos’ diversion pipe. In the written submission at [2.16], the D’Agostinos submit that the Tribunal ought to have accepted that only the two rear footings were required to have been poured and the cages installed, as any drainage issues arising from changes to the endorsed drainage plans needed to be addressed prior to laying the concrete for the footings and the concrete driveway.

The Tribunal went into considerable detail and analysis of the drainage issue and what, if any, impact it had in the period from September 2010 and the progress of the D’Agostinos’ development.[54] At paragraphs 90 to 91 and 132, the Tribunal set out why it did not accept that the drainage issues had affected the progress of the Development. The D’Agostinos failed to provide any evidence as to how the Tribunal’s failure to consider the Council’s lack of response to two letters, in the time frame of one month in 2010, was an impediment to the progress of the Development.
[54]Reasons [35], [38]–[48].

I agree with the Council’s submission that the submissions made by the D’Agostinos is no more than a complaint that the Tribunal ought to have decided this issue in their favour.

The reasons demonstrate that the Tribunal considered the claims made by the D’Agostinos in relation to the drainage issues and concluded that they were not a reasonable basis for the failure to complete the Development within the time already provided or that these factors, along with others, warranted the issue of a further extension of time.

Ground of appeal (iii)(g)
· Council’s misconduct and/maladministration of the permit process.

The D’Agostinos submit that the Council’s failure to answer other enquiries about the Council’s Doyles Road Drain Relocation works, was a failure to take into consideration Council misconduct in relation to this Planning Permit. Annexure A to the D’Agostinos written submissions is a document which is said to be a number of examples of a pattern of misconduct by the Council in respect of the permit relating to the D’Agostinos’ attempt to obtain approval for the drainage. Further, the D’Agostinos submit that the Tribunal failed to take into consideration previous findings of ‘misconduct’ by two members in the decisions of RP and RCD D’Agostino v Greater Shepparton City Council [2004] VCAT 1154, per Senior Member R C Horsfall and D’Agostino v Greater Shepparton SC [2006] VCAT 208, per Member Quirk.[55]
[55]Outline of Appellants’ submissions dated 10 April 2015, [2.18], citations omitted.

I consider the matters listed in annexure A are no more than assertions by the D’Agostinos of the Council’s misconduct. The matters, even if established, predate the period after the grant of the last extension of time in 2010, which was the proper focus of the Tribunal.

The matters referred to in the decisions before Senior Member Horsfall and Member Quirk are only relevant for matters up to 2004 and 2006. It is not clear how these are now relevant in the Tribunal’s exercise of discretion to extend in 2013.

The Tribunal found that the allegations concerning the drainage issues did not support a decision in favour of an extension of time.[56]

Ground (iii)(h)
·The need for the appellants to proceed with care, or ‘hasten slowly’, in completion of the Building Works, given the Council’s prior pattern of delay, obstruction, non‑response, and acts in ‘stalemating’ the progress of the Development.

[56]Reasons [132].

For the reasons set out above, I do not consider that this ground has any merit.

3A Third question of law
For the purposes of the exercise of the s 69 discretion, did the offsite fabrication works:
(a)constitute building works within the meaning of the Building Act 1993 and the regulations thereunder?;

(b) building works undertaken towards furtherance of the Development?
3B Related grounds of appeal
Ground (iv)

The Tribunal erred in finding that the offsite fabrication works – ‘did not constitute part of the Development of the land’ for the purposes of matters to be considered in the exercise of the s 69 discretion.
Ground (v)

Further or alternatively, in the matters to be considered by her in the exercise of the s 69 discretion, the learned Tribunal member misunderstood and/or misconstrued the nature and composition of the building works permitted by the building permit.

The starting point is to look at what the Tribunal said in relation to the offsite fabrication, contained in paragraphs 63 to 65 and 77 to 80 of the reasons. For convenience, I will set the full text out:

Since the issue of the building permit
63.The building permit was issued on 31 May 2010 and required the works to be commenced by 31 May 2011 and completed by 31 May 2013.
64.The applicants stated that shortly after the building permit was issued they ‘undertook further work in connection with the construction of the service station building, being fabrication of all 15 cages for the canopy in accordance with the specifications set out in Sheet 12 of 12 of the Building Permit and all 10 cages for the signs, fabricating all the one inch thick bolts; 8 bolts required for each of the 5 signs, and 4 for each of the 13 footings of the superstructure’.
65.These works were not undertaken on the subject land and although they relate to the building structure to be constructed on the subject land it is considered that these works do not constitute part of the development of the land, although they indicate the applicants’ intent to progress the permit, albeit slowly.
66.The applicants requested a six month extension for the first stage of the building permit on 14 October 2011, the Building Surveyor by letter dated 18 October 2011 agreed to an 11 month extension to the date of commencement of the building works from 31 May 2011 to 18 April 2012. Despite the applicants submitting ‘It is implicit from the correspondence that the date for completion of building construction works would be correspondingly extended to 24 months from the date by which building construction works had commenced i.e. to 18 April 2014’ there was no mention of extending the time under that permit for completion and there is nothing that would indicate the time was extended for completion. The Building Surveyor’s letter specifically stated ‘All building work must be commenced by 18 April 2012. Should the work not be completed, a new Building Permit will be required to be issued to address all uncompleted building work’. The two footings existing on the subject land were constructed on 18 April 2012. Nothing further has been constructed …
Whether the land owner is seeking to warehouse the permit
77.At the time the Tribunal considered the extension of time request in 2004 the Tribunal stated:
‘As the applicant has spent considerable sums to date in commencing the works, particularly the road access, I am satisfied that the applicant is not seeking to warehouse the permit but intends to proceed with the development’ (footnotes omitted).
78.It is acknowledged that the applicants have undertaken roadworks and in this respect spent a considerable amount. However since the Tribunal determination in 2004 the only works undertaken on the subject land appear to be the placement of fill to accord with the Inundation Overlay and the digging of two footings in 2012. Whilst the construction of steel caging was referred to this did not occur on the subject land.
79.The continued discussions and debate the applicants have had with not only the responsible authority but the drainage authority Goulburn Murray Water and VicRoads could lead me to conclude that they are not seeking to warehouse the permit, although those issues do not specifically centre on what is to occur on the subject land but rather on peripheral issues.
80.However the lack of any significant progression of the development, with constant focus by the applicants on these peripheral issues relating to drainage, not on the subject land, and possible road changes, when the required roadworks under the permit were completed in 2003, lead me to conclude that there is some form of ‘warehousing’ of the permit. This is due to the insignificant attempts to progress the development where there has been every opportunity since 2012 to progress the development to completion.

The parties agreed that the D’Agostinos’ case falls within the category of cases referred to as ‘completion cases’. That is, that the D’Agostinos seek an extension of time for the completion of the Development, not for commencement. In considering whether a permit should be extended in a completion case, the Court is still guided by the principles set out in Kantor. The D’Agostinos relied on the decisions of Juric[57] and Eyles[58] in which the Senior Members considered the fact that there had been substantial commencement and significant commitment, and that significant amounts of work and money had been committed, being relevant considerations in relation to a completion case.
[57]Drago Juric v Banyule City Council [2002] VCAT 396.
[58]Eyles v Hepburn Shire Council [2006] VCAT 1620 [19].

In considering what is substantial commencement, the cases of Liverpool City Council v Home Units Australia Pty Ltd (‘Liverpool’)[59] and Hunter Development Brokerage Pty Ltd v Cessnock City Council (‘Hunter Development’)[60] support the principle that in some circumstances ‘even work offsite which is referrable to the approved development is capable of constituting the substantial commencement of that development, provided some further work has been performed on-site’.[61]
[59][1973] 2 NSWLR 61 (‘Liverpool’).
[60]63 NSWLR 124 (‘Hunter Development’).
[61]Hunter Development, [40] (Tobias JA) relying on Liverpool.

In Hunter Development, Tobias JA cited with approval the decision of Hutley JA (sitting as a single judge in the Equity Division in the Supreme Court) in Liverpool, where his Honour said:

… It was suggested that this passage means that in determining whether work had been substantially commenced work off-site was to be disregarded, such work being preparatory work. Though the passage lays it down that there has to be work done on the site for there to be substantial commencement, it does not mean that work done off the site which is referrable to a particular building or structure is to be disregarded. Such work, though preparatory work in one sense, can be part of the unequivocal step indicating that the building has been commenced.
The law is not compelled to disregard the transformation in building practice brought about by prefabrication on a large scale and the development of the means for erecting buildings in situ by the assembling of prefabricated sections, e.g., the replacement of the erection of masonry on the site by pre-cast sections placed in the position by high cranes.
It would be ridiculous to disregard prefabricated work, or firm contracts for prefabricated work, in determining whether the building is substantially commenced, as in such work the great bulk of the expenditure on the building work may be made. Under the Liverpool Planning Scheme Ordinance the approval may only last for twelve months, unless the erection is substantially commenced within that time. Of that time much could well be spent in off site work to enable the building work to begin. A small amount of work on site may well be preceded by a great amount of work.
The distinction between preparatory work and other work is that work leading up to the making of the building contract is preparatory work, work which is part of the contract to erect is not preparatory work. Design work for incorporation in the contract is preparatory work, design work in consequence of the contract is not. Preparatory work is not work off site.
The erection of a structure has not substantially commenced if all that has happened is that planning is started to enable a contract to be let or the work of erection to be started but, provided some contract work has been done on site, all work which is part of the contract can be looked at to answer the question.[62]

[62]Liverpool, 69.

In the case of Liverpool, in order to determine whether the work had been substantially commenced, Hutley JA stated that ‘it is necessary to consider what is meant by substantial and what can be brought in and counted for this purpose, as against the total construction work envisaged’.[63] His Honour also referred to the judgment of Hardie J in North Sydney Municipal Council v Middle Harbour Investments Pty Ltd[64]:

The use of the adverb ‘substantially’ in the context, in my view, emphasises two points, or perhaps two different approaches to the one point. One is that the commencement must be some positive unequivocal step indicating that the building for which consent or approval has been obtained has actually been commenced … the commencement must be a real or actual one as distinct from preparatory work and as distinct from a notional or equivocal or sham commencement … The other point emphasised or brought out by the use of the word ‘substantially’ is that indicated by Stirling LJ in the Bournemouth Case where he stated that the corresponding phrase in the section then under consideration meant that ‘some substantial portion of the works…must have been physically commenced’. It will be seen that he construed the phrase as referring to the actual commencement of an important or substantial part of the work in question.[65] [emphasis added]

[63]Ibid 68.

[64](1963) 10 LGRA 41.

[65]Liverpool, 68-69.

From this passage, Hutley JA gleaned the test to be applied in determining whether work has been substantially commenced.[66] His Honour went on to say:

Though the passage lays it down that there has to be work done on the site for there to be substantial commencement, it does not mean that work done off the site which is referable to a particular building or structure is to be disregarded. Such work, though preparatory work in one sense, can be part of the unequivocal step indicating that the building has been commenced.
The law is not compelled to disregard the transformation in building practice brought about by prefabrication on a large scale and the development of the means of erecting buildings in situ by the assembly of prefabricated sections …[67]

[66]Ibid 69

[67]Liverpool, 69.

His Honour, Hutley JA, made note of prefabrication work being evidence of building being substantially commenced where ‘in such work the great bulk of the expenditure on the building work may be made’.[68] His Honour also referred to cases where a ‘small amount of work on site may well be preceded by a great amount of work’.[69] By contrast, Hutley JA held that work has not substantially commenced ‘if all that has happened is that planning is started to enable a contract to be let or the work of erection to be started’.[70]
[68]Ibid.
[69]Ibid.
[70]Ibid.

Ultimately, Hutley JA held that offsite work and preparation of the contractors done off site towards the final completion of the building should be considered when determining whether the building had been substantially commenced.[71]
[71]Ibid 70.

In the case of Hunter Development, Tobias JA also referred to the judgment of Hardie J in North Sydney Municipal Council:

It is to be observed that Hardie J considered that the requirement that the commencement be a real or actual one as distinct from preparatory work was mandated by the use of the adverb ‘substantially’.[72]

[72]Hunter Development, 132.

Justice Tobias adopted the approach of Hardie J in Liverpool, as outlined in the previous paragraphs[73] and held that for work to be considered substantially commenced, it ‘must be more than merely notional or equivocal in that it must truly be work relating in a real sense to that which has been approved’.[74]
[73]Ibid 133, 145.
[74]Hunter Development, 142.

In the case of Liverpool, the legal relevance of building works was discussed at length. The works in question included considerable excavation of the site, the delivery of various materials, a small amount of actual on-site construction, namely, a concrete block wall set on a concrete footing, delivery of two small sheds to the site, negotiation of various contracts with subcontractors, payment of various fees and placement of an order for reinforced steel.[75] It was noted by Hutley JA that the excavation was for the purpose of the construction of the garages and car ports required for parking space for the building.[76] It was held that on the facts of this case, work had substantially commenced.
[75]Liverpool, 66.
[76]Ibid 67.

The work carried out in Hunter Development was installing galvanised iron pipes, placing road pegs and permanent markings on site, survey work and geotechnical investigation work, including excavation of test pits, and landscape work.[77] This work was said to form a necessary part of the implementation of the physical work related to the development. It was held that the survey work and the geotechnical investigation work were preparatory but had a real relationship with the approved subdivision works and had physically commenced upon the land.[78]
[77]Hunter Development, 127–128.
[78]Ibid 148, 150.

The case law is quite clear that building works done offsite can be considered evidence of work completed. What is more pertinent, is whether the offsite fabrication can be considered to represent substantial commencement, as established in Liverpool and Hunter Development.

Prior to 13 September 2010, the appellants submit that substantial works were undertaken and significant costs were incurred and that since 13 September 2010 further substantial works were undertaken and significant costs incurred[79].
[79] Outline of Appellants’ Submissions dated 10 April 2015, 9–10.

This represents a total economic burden of approximately $50,000 since 13 September 2010.

It is not clear if the relevant works, namely the works since 13 September 2010, would be considered to have substantially commenced by the Tribunal. Do the preparatory nature of these works represent an ‘unequivocal step’ that the building of the Development had commenced?

The Tribunal considered the on-site works by referring to the two footings that were constructed on the subject land on 18 April 2012.[80] The Tribunal also noted the placement of fill to accord with the Inundation Overlay.[81]
[80]Reasons [66].
[81]Ibid [78].

It appears that the Tribunal erred in failing to recognise that building works that do not occur on the subject land can be considered to represent substantial commencement[82], as established in Liverpool and Hunter Development. The initial building works were intended to constitute part of the Development, contrary to what was stated by the Tribunal at paragraph 65 of the Reasons.
[82]Ibid [78].

Whether the offsite works identified by the appellant constitutes the substantial commencement of the Development is not clear and a matter that the Tribunal should have determined. As stated in Hunter Development, ‘the relevant work must be more than merely notional or equivocal in that it must truly be work relating in a real sense to that which has been approved’.[83] I consider this an issue which needs to be remitted and determined by the Tribunal. It is not for this Court to enter into a fact finding exercise which the legislature has entrusted to the Tribunal.
[83]Hunter Development, 142.

In relation to Question of law 3A ground (a), the D’Agostinos submitted that the Tribunal erred in finding that the offsite fabrication work did not constitute part of the Development of the land in light of the meaning of ‘building works’ as defined in s 3 of the Building Act 1993 which provides:

‘Building work’ means work for or in connection with the construction, demolition or removal of a building.

Further, the D’Agostinos submitted that when one considers the definitions in s 1 of the P and E Act, that the offsite fabrication work by the appellants should have been considered works on the subject land.

The definitions pursuant to the P and E Act are not contemplated or raised in the notice of appeal. No amendment was sought. Accordingly, the application of the definition in the P and E Act cannot be raised.

Counsel for the D’Agostinos in oral submissions contended, given the definitions in the Building Act and the P and E Act, along with the decisions of Liverpool and Hunter Development, the Tribunal erred in that it misconceived the concept of ‘offsite fabrication’ and ‘warehousing’.[84] Further, the D’Agostinos submit that the Tribunal erred in not taking into consideration the offsite works which put the D’Agostinos’ development into the ‘completion cases’ as considered in Drago Juric v Banyule City Council.[85]
[84]Transcript, 15 June 2006, 5, LL 28-29.
[85][2002] VCAT 396.

It is not clear how the D’Agostinos submit s 3 of the Building Act is relevant to the application. This is an application pursuant to the P and E Act and what the applicant seeks is an extension of time for the permit which allows for a development of the land.

In summary, I consider that the Tribunal made an error of law as submitted in Question of law 3A(b) and Question of law 3B grounds (iv) and (v), but not Question of law 3A (a).

4A Fourth question of law

In the exercise of s 69 discretion did the Tribunal take into account considerations irrelevant to the exercise of the discretion?

4B Related grounds of appeal

Ground (vi)
In distinguishing the decision in Juric v Banyule City Council[86] regarding –
The distinction between time limits for the starting of a development and for completion of a development.[87]

The Tribunal erred in finding that –
Unlike in Juric and for that matter Eyles v Hepburn Shire Council[88] there are no half- finished buildings there are only footings, construction of road works, the raising of the soil level and some drainage and other infrastructure.
[86][2002] VCAT 396.
[87]Reasons [125].
[88][2006] VCAT 1620.

as a basis for the exercise of the s 69 discretion.
Ground (vii)
Further, or in the alternative, the Tribunal misconstrued and/or misunderstood the nature and composition of the Building Works, in particular, as appears from the evidence including the endorsed plans:
(a)the ‘shop component’ of the Development was not a fixed structure, but a transportable/relocatable building; and
(b)apart from works relating to the drainage works[89] and citing the transportable/relocatable shop[90], the Building Works were confined to construction of the service station canopy[91] and signage.[92]

[89]Endorsed Building Plan 3/2 and 4/2.

[90]Annexure E to the Building Permit.

[91]Endorsed Building Plan 7/12, 8/12, 9/12 and 12/12.

[92]Endorsed Building Plan 2/12 and 11/12.

It seems that the D’Agostinos are really complaining that the Tribunal failed to take into account the fact that there was work completed offsite, such as the construction of the service station canopy. Accordingly, the D’Agostinos consider that the fact that there was not a half-finished building as there was in Juric’s case is irrelevant. At paragraph 126 of the reasons, the Tribunal said:

Unlike in Juric and for that matter Isles v Hepburn SC, there are no half-finished buildings there are only two footings, construction of road works, the raising of the soil level and some draining and other infrastructure. The problem is definitely is getting the development completed and whilst the applicants say they are making every attempt to progress the development, this is not evidenced on the ground.

I consider the Juric point was not irrelevant. The real vice is in the Tribunal’s failure to consider the offsite work in this context.

It is not clear how much consideration was given by the Tribunal to the Juric point in its ultimate decision. This is in contrast to the offsite works which was acknowledged by the Tribunal, but then disregarded.

There is some ambiguity in the reasons as to what the Tribunal considered constituted building works. The D’Agostinos submit that the composition of the building works included the shop, as shown on the plans as a portable building; the construction of the service site canopy and signage. At paragraph 65 of the reasons, the Tribunal appears to accept that the D’Agostinos had undertaken some ‘works’ related to the building’s structure which was to be eventually constructed on this site. Again because of the erroneous distinction between offsite works, these works were not considered by the Tribunal. In these circumstances, while I do not consider the Tribunal erred in taking into consideration the Juric point, it misconstrued the nature and composition of the building works.

5A Fifth question of law
In the circumstances of the case, did –
the effflux of time and the changing of policies that underpin the planning scheme, and the changes occurring in the surrounding area,

support the finding of the Tribunal that a new permit was required for the land ‘with more appropriate conditions to take account of the various changes’(‘the New Permit finding’)
5B Related grounds of appeal
Ground (viii)
In making the New Permit finding, the Tribunal erred in failing to identify the ‘changing policies that underpin the planning scheme’, such as to support:
(a)a finding that it was ‘time for a new permit, with more appropriate conditions to take account of these various changes’, and
(b)the exercise of the s 69 discretion against Appellants, based on the view that it was ‘time for a new permit, with more appropriate conditions to take account of these various changes’. (footnotes omitted)

Ground (ix)
Further, or in the alternative to (viii), in making the New Permit finding, the Tribunal miscarried its discretion as to matters relevant to the exercise of that discretion.

The D’Agostinos submit that the Tribunal erred in that it stated in the reasons that it had regard to changes in planning policy, as a factor in determining whether the D’Agostinos should apply for a new permit rather than an extension being given for the existing permit. The D’Agostinos submit that the Tribunal does not identify any relevant changes in planning policy applicable to the land or the application.

The Council submits that the Tribunal identified at paragraphs 68 to 76 and 130 to 131 of the reasons, relevant changes in planning policy upon which it based its decision.

In paragraphs 68 to 76 of the reasons, the Tribunal considered whether there had been a change in planning policy. Reference was made to earlier changes in planning policy and that the Tribunal in earlier decisions had concluded that the changes in planning policies were not so significant to require the refusal of an extension.

The only fresh amendments considered by the Tribunal were amendments C12 and C148. The Tribunal did not, in its reasons, suggest that amendments C12 and C148 affected the land or proposed Development. At paragraph 74 of the reasons, the Tribunal stated:

Even if the zoning has not changed since the Tribunal’s consideration of the extension of the time in 2004 that does not mean to say the state and local planning policies including the municipal strategy statement that underpins the Greater Shepparton planning scheme have not changed with different emphasis being placed on transport and economic development. I accept what was said by both the responsible authority and VicRoads that if a new permit was sought for a service station in this location, whilst buildings and works in relation to a service station would be likely to be approved, new conditions would be imposed to accord with the changed policies and surrounding development that has occurred. In particular this would include a requirement for a permit to access the road in a road zone category 1, which includes both Doyles Road and Midland Highway. As VicRoads is a relevant road authority for both roads any access would be subject to approval by VicRoads and their aspirations for the roads would need to be taken into account.

The Tribunal had regard to the Freight Futures document. The D’Agostinos submit that a proper reading of Amendment C148 and Freight Futures document reveal that neither document constitutes a policy document or a change in planning policy.[93] It is submitted that the C148 amendment has a discrete and limited purpose and was specifically designed and implemented to allow for the reservation of land on the western side of Doyles Road, to enable the duplication of that road. Accordingly, it is submitted that the amendment only affects land at 293-295 Midland Highway, Shepparton on the north-western corner of the Midland Highway/Doyles Road intersection, and not to the D’Agostinos’ land. To that end, the D’Agostinos submit from a planning scheme perspective, C148 does not impact the use and development of the D’Agostinos’ land. This was not contested by the Council.
[93]Outline of appellant submissions in reply dated 13 May 2015 [17] and [19].

In oral submissions counsel for the Council said that ultimately the Tribunal, for the purpose of the extension application, needed to understand that policy had changed, the Tribunal did not have to assess whether the changes were going to make a difference to the potential conditions of the permit. It was put by counsel:

Now, it may or may not be but if the document is properly referred to in the planning scheme and it’s a document that is required to be considered in informing in any decision. It wasn’t for the Tribunal to then go in to that particular path make its assessment and say I think it’s actually going to make a difference. All it needed to do was understand that policy had changed and there was a likelihood. It didn’t need to go and actually make an assessment because it was assessing on a slightly macro level whether or not planning policy had changed such that one would need to consider whether this same permit could be granted…We say the Tribunal was entitled to be satisfied on that macro level that there were changes, and bearing in mind as his Honour says, even if there are no changes that doesn’t mean you get an automatic extension.[94]

[94]Transcript 15 June 2015, 66, LL 25-31, 67, LL 1-5, LL 11-31, 68, LL 1-4.

In determining whether to grant an extension of time, the Tribunal correctly considered relevant changes in policy planning. This is particularly relevant to the finding that the D’Agostinos could ultimately apply for a new permit and that any new permit would reflect new changes to planning policy. The difficulty is that there is no nexus identified between the documents relied upon, amendments to C12 and C148, and the Freight Futures document, nor any possible relevant change to planning policy which affects the land. I accept the D’Agostinos’ submission that Amendment C148 and the Freight Futures document could only be relevant considerations to an application for an extension of time if they contained information that somehow impacted on the D’Agostinos’ land and would result in different conditions being applied to the permit. To suggest that the Tribunal could take into account policies and documents at a ‘macro level’, ignores the need to establish at least some relevance to the land and permit in question. Even at a macro level, some nexus needs to be demonstrated.

I note that while it could be said that the Tribunal took into account irrelevant material by way of Amendment C148 and the Freight Futures documents, when considering the new permit, it did consider the need for the D’Agostinos obtaining a new permit for access to Doyles Road and Midland Highway.

The Tribunal considered other potential changes in relation to permits required by VicRoads including to ‘Higher Productivity Freight Vehicles’[95] and access to and from Midland Highway and to and from Doyles Road. The Tribunal noted that while there were no current changes in relation to these two issues, there may be, in due course, a need for approval.
[95]Reasons [108].

In summary, I consider the Tribunal made an error of law as submitted in Questions of law 5A and 5B.

6A Sixth question of law

In the exercise of the s 69 discretion did the Tribunal misconstrue and/or misapply the concept of ‘warehousing’, in the circumstances of the case?

6B Related grounds of appeal

Ground (x)

The finding of the Tribunal that there had been ‘some form of warehousing of the permit’ (‘the warehouse finding’) was uncertain and/or ambiguous in the circumstances.

Ground (xi)

Alternatively, the warehouse finding was, on the facts and evidence before the Tribunal, contrary to and/or inconsistent with authoritative prior decisions of the Tribunal, and wrong in law.

Ground (xii)

Further or alternatively, the warehouse finding was not reasonably open on the whole of the evidence, in that –

a. The circumstances of the immediate case were not such that there had been ‘the passage of a lot of time, without anything happening on site’;

b. There was no, or no sufficient evidence that the Appellants did not intend to complete the Development, or take such acts as were necessary to complete the Development;

c. In the period prior to September 2010, substantial works were carried out pursuant to the Permit;

d. In the said period, Building Works including the offsite fabrication works were carried out by the Appellants in furtherance of the Development;

e. The economic and financial burden borne by the Appellants during the said period in carrying out Building Works in furtherance of the Development;

f. The overall economic and financial burden of the Development borne by the Appellants;

g. Council’s failure to respond to the Appellants’ enquiries concerning the impact on the approved drainage plans of Council’s works to the 3/2 drain;

h. The need for the Appellants to proceed with care, or ‘hasten slowly’, in completion of the Building Works, given the Council’s demonstrated past pattern of delay, obstruction, non-response and acts ‘stalemating’ the progress of the Development.

In Kantor, Ashley J held that a factor tending against the grant of an extension, is ‘any material which suggests that the owner of land is seeking to ‘warehouse’ a permit’.[96] Warehousing was described as a situation where the owner of land holds a long-held and unused permit for the purposes of obtaining a windfall by selling the land at a later time.[97]
[96]Kantor, 313.
[97]Ibid 313–314.

The circumstances in this case, do not indicate that the permit was unused, despite the fact that it was long-held and there were frequent delays to the Development. The facts do not demonstrate that the D’Agostinos never intended to act on the permit and were warehousing the permit to obtain a windfall from a later sale of the land.

The concept of ‘warehousing’ was explored in Genser and Associates (Aust) Pty Ltd v Yarra CC (‘Genser’).[98] The Senior Member, Russell Byard, referred to the responsible authority’s reference to the applicant having had ‘ample time’ in relation to the permit.[99] The responsible authority had made this submission in reference to the period of approximately eight years since the grant of the permit.[100] The Senior Member held that:

The point I would like to make here is that, although eight years cumulative might have been ample or more than ample if that was the original time limitation, the circumstances in this case are that the company was given an inadequate time limit to which have been added a series of extensions, all inadequate in themselves, so that the applicant never had the benefit of a reasonable and sufficient time limit before it at a particular stage.[101]

[98][2004] VCAT 2640 (31 December 2004) (‘Genser’).

[99]Genser [20].

[100]Ibid.

[101]Ibid.

The Senior Member went on to say:

I think it is clear that warehousing is not demonstrated by a mere passage of time, or the passage of a considerable amount of time from the granting of a permit, without the commencement of development. The passage of a lot of time, without anything happening on site, is consistent with warehousing, and may be indicative of it, but the mere passage of time is not sufficient itself.[102]
…
I take the term warehousing to apply to a situation where someone obtains a planning permit, or perhaps a number of planning permits, but without intending to act on them, or at least with no intention of acting on them in the foreseeable future. The existence of a planning permit for a particular development can enhance the value of land. The existence of one or several or many permits might be obtained speculatively to try and achieve such an enhancement. Evidence of a permit holder ‘sitting on his hands’ and doing nothing over a considerable time may be an indication of a warehousing strategy. However, it may not; particularly where an active developer has encountered delays.[103]

[102]Ibid [27].

[103]Ibid [30].

The analysis of the concept of warehousing in Genser is consistent with Ashley J’s findings in Kantor and with the circumstances in this case.

The Tribunal erred in ignoring the construction of the steel caging because it did not occur on the land.[104] The conclusion that warehousing of the permit had occurred was determined by the Tribunal due to the ‘lack of significant progression of the Development’ and the ‘constant focus by the D’Agostinos’ on peripheral issues’, such as drainage and road changes.[105]
[104]Reasons [78].
[105]Reasons [80].

At paragraph 129 of the Reasons, the Tribunal concluded that the D’Agostinos are warehousing the permit and may never complete the Development due to:

The inability of the applicants to progress the development in the period 2010 to 2013 when all plans were in place and there was no impediment to the development. The applicants were given a sufficient period of time, namely two years to complete the development from when all plans were endorsed. Apart from digging two footings in this period of time they have otherwise failed to progress the development in any meaningful way.[106]

[106]Ibid [129].

While a substantial amount of time has passed since the granting of the permit, the ‘mere passage of time’ is not itself sufficient to demonstrate a warehousing strategy. It appears that the D’Agostinos intended to act upon the planning permit, due to the works referred to at paragraphs 85 and 86. These works do not indicate that the D’Agostinos were intending to ‘sit on their hands’.

I consider the Tribunal misconstrued the concept of warehousing and failed to take into account the works that had already been undertaken by the D’Agostinos. Evidence of the commencement of the Development, though not completed, demonstrates that the D’Agostinos did not intend to warehouse the permit.

7A Seventh question of law
In all the circumstances was the Tribunal’s decision so unreasonable that no reasonable Tribunal could have come to it?
7B Related grounds of appeal
Ground (xiii)
The Tribunal’s decision that the offsite fabrication works was not a relevant consideration lacked an evident and intelligible justification, and was therefore so unreasonable that no reasonable Tribunal could have come to it.
Ground (xiv)
The Tribunal’s failure to take into account as a relevant consideration Council’s failure to respond to the Appellant’s enquiries concerning the impact of Council’s works to the 3/2 drain on the approved drainage plans was in the circumstances so unreasonable that no reasonable Tribunal could have come to it.
Ground (xv)
The Tribunal’s failure to consider as relevant Council’s misconduct and/or maladministration of the permit process, constituted a decision lacking an evident and intelligible justification, and was in all the circumstances so unreasonable that no reasonable Tribunal could have come to it.

For the reasons set out above I would allow Question of law 7A and ground of appeal (xiii) but not grounds (xiv) and (xv).

Conclusion

In summary, I consider the Tribunal erred in law in that it did not take into consideration in the exercise of the s 69 discretion the offsite works carried out by the D’Agostinos. Further, in doing so the Tribunal misconstrued the nature and composition of the building works and the concept of warehousing. The offsite works are evidence of the commencement of the Development and arguably demonstrate that the D’Agostinos did not intend to warehouse the permit.

I consider the Tribunal erred in making the new permit decision without identifying the relevant change in policy. The appeal must be allowed.

Should the proceeding be remitted to the Tribunal?

Having found that the Tribunal failed to take into account the offsite works and wrongly took into consideration the Amendment C148 and the Freight Futures documents when considering whether a new permit was required, the question arises as to what the consequences of the error should be. The above errors of law would not be vitiating errors if the Tribunal’s decision would have been the same regardless of the error.[107]
[107]Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321, 384 (Toohey and Gaudron JJ).

The decision of the Tribunal should be affirmed if there is no possibility of concluding that had the Tribunal taken into account the offsite works, the extension would have been granted. As I have noted, the Tribunal did not regard the offsite work as insignificant and that the works at least indicated the D’Agostinos’ intent to progress the permit, albeit slowly.[108] Further, it is not clear if the Tribunal would have reached a different conclusion if it found that there was no real or relevant changes to planning policies that affect the D’Agostinos’ land and permit.
[108]Reasons, [65].

The Tribunal found that there was no bar to the D’Agostinos applying for a new permit. The Tribunal noted that the use of the land for a service station is of right and that a permit is only required for building and works; signage and road access. It is not clear if the requirement of a new permit will not cause any substantial injustice to the D’Agostinos. I am not satisfied that a new permit which will impose new conditions would not cause material detriment to the D’Agostinos.

This is a case that ran for four days before the Tribunal. The appeal before this Court took three sitting days. I do not consider it appropriate for this Court to make findings of fact about whether the offsite works or potential planning policies are factors that would tip the balance to conclude that the extension of time should be granted to the D’Agostinos. The High Court has stressed the limited nature of the appeal under s 148 of the VCAT Act, and warned against the Court making essentially factual, evaluative judgments that the legislature has entrusted to the Tribunal to make.[109]
[109]Osland v Secretary to the Department of Justice [2010] HCA 24 (23 June 2010), [20] (French CJ, Gummow and Bell JJ).

Accordingly, I consider the proceeding should be remitted to the Tribunal to be decided again. Subject to any submissions I consider the proceeding should be remitted to the Tribunal member who determined the proceeding, to determine it again, in accordance with these reasons. It may well be possible for the Tribunal to determine on the basis of the evidence that was before it on the first hearing, although that will be a matter for the Tribunal. I consider that remitting the proceeding to a differently constituted Tribunal may have serious resource implications and add to the costs and delays of the decision-making process. Justice Kyrou in Vegco Pty Ltd v Gibbons & Ors[110] relevantly said:

33. For the Court to be persuaded to order a remittal to a differently constituted decision maker, good reason for doing so, based on established principles, must be shown by the party seeking such an order. The guiding principle is that remittal will be to a differently constituted primary decision-maker where there is some feature of the conduct or reasons for decision of the primary decision-maker which would render it unfair to the successful party or give the appearance of unfairness to that party (whether arising from strongly expressed views on key issues, adverse findings on the credit of witnesses, apprehended bias or otherwise) if the matter were remitted to the same decision-maker or where it would be impracticable for the primary decision-maker to re-determine the matter. (citation omitted)

[110][2008] VSC 363 (17 September 2008) [33].

In this case, submissions have not been made on this issue and I will give the represented parties an opportunity to do so.

Accordingly, I will hear submissions from counsel on whether I should order that the Tribunal be differently constituted and generally on the precise form of the orders to be made by me.

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CERTIFICATE

I certify that the 44 preceding pages are a true copy of the reasons for Judgment of Zammit J of the Supreme Court of Victoria delivered on 14 July 2015.
DATED this 14^th day of July 2015.

Associate