East Melbourne Group Inc v Minister for Planning

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No 4550 of 2005

EAST MELBOURNE GROUP INC
	Appellant
v
MINISTER FOR PLANNING and PCH MELBOURNE PTY LTD (ACN 076 397 239)	First Respondent
	Second Respondent

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JUDGES:	WARREN CJ, ASHLEY and REDLICH JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	21 June 2007
DATE OF JUDGMENT:	31 October 2008
MEDIUM NEUTRAL CITATION:	[2008] VSCA 217

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ADMINISTRATIVE LAW - Judicial review – Ministerial powers – Amendment to Melbourne Planning Scheme – Exemption from notification requirements – Whether Minister’s decision Wednesbury unreasonable – Public reasons for decision - Whether regard may be had to additional documents – Planning and Environment Act 1987 ss 17, 18, 19, 20 (4).

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr H McM Wright QC with Mr J D Pizer	William Murray Solicitors
For the First Respondent	Ms M L Quigley SC with Dr K Emerton SC	Victorian Government Solicitors
For the Second Respondent	Mr I McP Pitt SC with Mr S R Horgan	Best Hooper Solicitors

WARREN CJ:

This is an appeal from a judge of the Trial Division. The substantive dispute between the parties concerns the validity of Amendment C101 to the Melbourne Planning Scheme made by the then Minister for Planning, the Hon Mary Delahunty (‘Minister’). Amendment C101 was listed in the Government Gazette on 16 December 2004. In approving and adopting Amendment C101, the Minister exercised her power under s 20(4) of the Planning and Environment Act 1987 (Vic) (‘Act’) to exempt herself from the requirements of ss 17–19 of the Act (‘notice provisions’).

Section 20(4) of the Act provides:

The Minister may exempt himself or herself from any of the requirements of sections 17, 18 and 19 and the regulations in respect of an amendment which the Minister prepares, if the Minister considers that compliance with any of those requirements is not warranted or that the interests of Victoria or any part of Victoria make such an exemption appropriate.

By way of s 8(2), the Minister is a planning authority under the Act.

Section 19(5) of the Act was altered after Amendment C101 was approved and adopted. At the relevant time, ss 17, 18 and 19 of the Act provided:

17 Copies of amendment to be given to certain persons
(1)A planning authority must give copies of any amendment it prepares to a planning scheme together with the explanatory report and any document applied, adopted or incorporated in the amendment—
(a)to a municipal council, if the amendment applies to its municipal district; and

* * * * *
(c) to the Minister; and
(d) to any other person whom the Minister specifies.
(2)A planning authority must also give a copy of any agreement entered into under section 173 to any person to whom it gives a copy of the amendment if the agreement or part of the agreement will not come into operation fully unless the amendment comes into operation.

18 Availability of amendment
The planning authority that prepared an amendment and any person who is given a copy of an amendment under section 17(1)(a) or (c) must make the amendment, the explanatory report, any document applied, adopted or incorporated in the amendment and any accompanying agreement available at their respective offices during office hours for any person to inspect free of charge until the amendment is approved or lapses.

19 What notice of an amendment must a planning authority give?
(1)A planning authority must give notice of its preparation of an amendment to a planning scheme—
(a)to every Minister, public authority and municipal council that it believes may be materially affected by the amendment; and
(b)to the owners (except persons entitled to be registered under the Transfer of Land Act 1958 as proprietor of an estate in fee simple) and occupiers of land that it believes may be materially affected by the amendment; and
(c)to any Minister, public authority, municipal council or person prescribed; and
(ca)to owners (except persons entitled to be registered under the Transfer of Land Act 1958 as proprietor of an estate in fee simple) and occupiers of land benefited by a registered restrictive covenant, if the amendment provides for the removal or variation of the covenant; and
(d)to the Minister administering the Land Act 1958 if the amendment provides for the closure of a road wholly or partly on Crown land.

(1A)Subject to sub-section (1C), the planning authority is not required to give notice of an amendment under sub-section (1)(b) if it considers the number of owners and occupiers affected makes it impractical to notify them all individually about the amendment.
(1B)A planning authority which does not give notice under sub-section (1)(b) for the reasons set out in sub-section (1A) must take reasonable steps to ensure that —
(a)public notice of the proposed amendment is given in the area affected by the amendment; and
(b)that notice states that owners and occupiers of land referred to in sub-section (1)(b) are entitled to make submissions in accordance with sections 21 and 21A.

(1C)Sub-section (1A) does not apply in relation to the giving of notice to an owner of land of an amendment which provides for —
(a) the reservation of that land for public purposes; or
(b) the closure of a road which provides access to that land.
(2)A planning authority must publish a notice of any amendment it prepares in a newspaper generally circulating in the area to which the amendment applies.
(2A)A planning authority must cause notice of an amendment providing for the removal or variation of a registered restrictive covenant to be given by placing a sign on the land which is the subject of the amendment.
(3)On the same day as it gives the last of the notices required under sub-sections (1), (2) and (2A) or after all other notices have been given under this section, the planning authority must publish a notice of the preparation of the amendment in the Government Gazette 15.

(4) Any notice must —
(a) be given in accordance with the regulations; and
(b)set a date for submissions to the planning authority which, if notice of the preparation of the amendment is given in the Government Gazette, must be not less than one month after the date that the notice is given in the Government Gazette.

(5)The failure of a planning authority to give a notice under sub-section (1) does not prevent the adoption of the amendment by the planning authority or its submission to or approval by the Minister.
(6)Sub-section (5) does not apply to a failure to notify an owner of land about the preparation of an amendment which provides for —
(a) the reservation of that land for public purposes; or
(b) the closure of a road which provides access to that land.
(7)A planning authority may take any other steps it thinks necessary to tell anyone who may be affected by the amendment about its preparation.

The plaintiff at first instance and the appellant in this appeal is East Melbourne Group Inc, an association representing residents in the East Melbourne area. The first defendant at trial and first respondent to these proceedings is the Minister for Planning. The second defendant and second respondent is PCH Melbourne Pty Ltd (‘PCH’), the owner of the land directly affected by Amendment C101.

At the hearing before the trial judge, the appellant submitted that the Minister’s decision in relation to Amendment C101 was invalid. The appellant also submitted that the Minister’s subsequent exemption under s 20(4) of the Act was invalid because it was based upon the proposition that the development authorised by Amendment C101 would be completed by March 2006 so as to provide accommodation for visitors attending the Commonwealth Games. The appellant submitted therefore that Amendment C101, ‘is and was invalid, void and of no lawful effect.’ The trial judge rejected the appellant’s prayer for a declaration to this effect.[1] The appellant now appeals.
[1]East Melbourne Group Inc v Minister for Planning (2005) 12 VR 448 (‘Reasons’).

Background facts

Amendment C101 was essentially concerned with three properties in East Melbourne: the Hilton Hotel, the MCG Hotel and Mosspennoch House. These properties are all owned by the second respondent, PCH. In 2001, PCH applied to the City of Melbourne for a permit under the Melbourne Planning Scheme for the redevelopment of the MCG Hotel, which adjoins the Hilton Hotel site to the east but is contained within the same title. Amongst other matters, permission was sought to build a 13 storey building with 60 apartments. The City of Melbourne refused that application.[2]
[2]Application TP 01/345.

PCH appealed to the Victorian Civil and Administrative Tribunal (‘Tribunal’). On 3 May 2002, the Tribunal refused PCH’s appeal because, in light of the applicable zoning and overlay, the proposed building overwhelmed the surrounding properties.[3] However, the Tribunal was not outright in its rejection of the proposal and PCH amended some aspects of the project so as to address the Tribunal’s concerns. Having forwarded their amended proposal to the appellant in March 2004, PCH reapplied to the Melbourne City Council for a permit. The proposal included, inter alia, plans to demolish the rear of the MCG Hotel and construct a 15 storey building comprising 89 apartments.[4] On 6 August 2004, the Melbourne City Council gave notice of the application to persons affected[5] and, in response, 25 objections were lodged.
[3]PCH Melbourne Pty Ltd v Melbourne City Council (2002) 122 LGERA 375. In addition, at around this time, PCH sought the removal of a condition from a permit issued in 1982 with respect to the use of the Hilton Hotel. This matter was decided on the papers at the Tribunal and is the subject of separate legal proceedings: see Reasons, [26].
[4]Application TP 04/0638.
[5]As required under Planning and Environment Act 1987 (Vic), s 52(1).

An officer of the City of Melbourne assessed the amended proposal and considered that, inter alia, it did not comply with the objectives and requirements of the Melbourne Planning Scheme. Furthermore, the proposal did not comply with an amendment, Amendment C93, that was under consideration at the time. If introduced, the proposed Amendment C93 to the Melbourne Planning Scheme would have imposed a 24 metre height restriction on the relevant land.[6] Clearly, a 15 storey building would have stood above this height. Despite the existence of a report by the relevant officer to this effect, the City of Melbourne did not positively reject the amended proposal at this point, instead withholding its decision. On 19 November 2004, PCH applied to the Tribunal with respect to the failure by the City of Melbourne to make a decision within the prescribed time period. The matter was listed by the Tribunal for hearing in February 2005. However, for reasons that will become evident, that hearing did not take place.
[6]Amendment C93 proposed a revision of the existing Design and Development Overlay Schedule 21 (‘DDO’). The existing DDO specified a discretionary maximum building height of 24 metres over the frontage along Wellington Parade from Clarendon Street to Hoddle Street. Although they are situated within this area, the Hilton Hotel, Freemasons Hospital and Mercy Hospital sites were not included in the DDO. The revision was to include these sites and impose a mandatory building height of 24 metres.

In addition to the process of applying for a permit to develop and use the relevant land in the manner proposed, PCH sought the Minister’s approval to amend the Melbourne Planning Scheme so that a permit would not, in fact, be necessary for the development to proceed. The Minister decided that an amendment was required and consequently purported to amend the Melbourne Planning Scheme by adopting and approving Amendment C101. The exercise of statutory power conferred under s 20(4) of the Act, culminating in the purported amendment, is the subject of this appeal.

Documents

The trial and appeal were concerned with a number of documents relating to the Minister’s decision under s 20(4) of the Act. Those documents and circumstances surrounding their creation are summarised below.

Thakral letter dated 13 October 2004

By letter dated 13 October 2004, Mr Dan Kolomanski, the Victorian Development Director of PCH’s parent company, Thakral Holdings Ltd (‘Thakral’), wrote to the Minister for Planning. The letter initially sets out the extensive investments Thakral has made in Australia and Victoria, especially in its ‘East Melbourne assets’. Mr Kolomanski notes:

Thakral has dedicated significant financial resources and a senior development team to East Melbourne without achieving any reasonable prospect of being able to improve these assets to achieve their full potential …
In order to maintain the 5 star standard of the Hilton Hotel, we will be required to expend at least $15 million on a major refurbishment, together with a $40 million expansion of residential accommodation and refurbishment of the adjacent MCG Hotel. We also propose to invest a further $20 million on the adjacent historic Mosspennoch property to restore it to its former glory and residential use, and to complete the development of the car park area adjacent to the Hilton on the Park.

Mr Kolomanski then notes the ‘continual decline’ of the Hilton Hotel’s net operating profit and capital value since Thakral assumed ownership of it. Importantly, he also states:

With many Commonwealth Games events to be held at the adjacent Melbourne Cricket Ground, Flinders tennis complex and Olympic Park [athletic] complex, it is vital that we commence works without delay if we are to have the Hilton on the Park fully refurbished and operational for the Melbourne Commonwealth Games in 2006.[7]

[7]Emphasis in original.

Mr Kolomanski then summarises the planning procedures that PCH have undergone up until that time and is critical of height restrictions proposed over the MCG Hotel land in Amendment C93. He concludes the letter stating:

Without the assistance of the State Government in maintaining and enhancing the Hilton-on-the Park Hotel and the MCG Hotel, we will have no choice but to review our investment/disinvestment options to stem the continued capital losses. One very real option is the cessation of the Hilton on the Park in its current form and the redevelopment and orderly disposal of these assets.
Hilton Hotels are a world renowned brand and the withdrawal of such a powerful and respected brand from the Melbourne market would be a regretful but necessary commercial decision by Thakral, a major blow to the 328 hotel employees and approximately 1400 employees in support and service industries and to the standing of Victoria in the international business community.
We believe that our East Melbourne land holdings, including iconic buildings such as:
·The MCG Hotel (formerly Parade Hotel @ 1853) where the rules of Australian Rules Football are widely believed to have been originally penned;
·Mosspennoch House originally built in 1881; and
·The Hilton on the Park Hotel

represent a site of State significance warranting the intervention of the State Government to ensure that these assets are preserved and enhanced, particularly with many 2006 Commonwealth Games events to be held at the adjacent Melbourne Cricket Ground, Flinders Park tennis complex and Olympic Park athletic complex.

Mr John Phillips, the Manager of Development Approvals for Central City and Alpine in the Department of Sustainability and Environment, deposed on affidavit that, on or about 19 October 2004, he was asked to advise the Minister on the letter.[8] Mr Phillips also deposed that, on 18 November 2004, he attended a meeting with two senior government officers from the Department of Industry, Innovation and Regional Development. Thakral’s letter of 13 October 2004 was discussed at that meeting. Mr Phillips deposed that the two senior government officers ‘advised me that they had been advised by Thakral that the refurbishment of the Hilton Hotel could be completed before the Commonwealth Games’. Mr Phillips also stated that, on 26 November 2004, he attended a meeting with Mr Kolomanski and one Mr Kevin Love, the Deputy Secretary of the Department of Sustainability and Environment. Mr Phillips explained the meeting as follows:

Mr Kolomanski explained Thakral’s proposed refurbishment and re-development of the Hilton Hotel, and the restoration of the MCG Hotel and Mosspennoch House, and put Thakral’s case for Government intervention to allow these projects to proceed without further delay. In particular, Mr Kolomanski told me that intervention was required if the refurbishment of the Hilton Hotel was to be completed before the staging of the Commonwealth Games.

First Briefing Note

[8]During this period, on 22 October 2004, the Registration Committee of the Heritage Council heard an application by the East Melbourne Group Inc for the MCG Hotel to be included in the Victorian Heritage Register pursuant to the Heritage Act 1995 (Vic). It is not of direct relevance to this appeal: Reasons [34].

Later that day, Mr Phillips authorised a briefing document (the ‘First Briefing Note’) which was prepared by a Senior Project Planner at the Department of Sustainability and Environment. This document comprises a five page ministerial briefing with a handwritten date on the front page of 1 December 2004. The exhibit reveals that the purpose of the briefing is ‘to brief the Minister in relation to Amendment C93 to the Melbourne Planning Scheme (currently being exhibited) which proposes to introduce mandatory height controls across parts of Melbourne’.

The document begins with a recommendation that the Minister

agree that the Acting Deputy Secretary – Built Environment, write to the Chief Executive Officer of the City of Melbourne, with regard to Amendment C93 to the Melbourne Planning Scheme, to put a DSE [Department of Sustainability and Environment] position generally in accordance with the attached table 1 of this brief.

The exhibit did not attach a copy of Table 1 referred to in the document. The document goes on to provide the history of key sites covered by Amendment C93, namely the Hilton Hotel and MCG Sites on Wellington Parade, and Mosspennoch on Clarendon Street. The section contains the following statement:

Thakral Holdings Ltd, the owners of the Hilton and MCG Hotels and Mosspennoch sites, have recently written to you expressing their concern with the planning process of refurbishing and redeveloping the sites. Thakral Holdings Ltd believes this matter warrants the intervention of the State Government to ensure that these assets are preserved and enhanced, particularly with many 2006 Commonwealth events to be held at the adjacent MCG, Melbourne Park tennis complex and Olympic Park Athletic complex. The Department is consulting with other parts of government on the strategic significance of this proposal.

A section entitled ‘issues’ generally recommends against mandatory height controls in favour of retaining discretionary height controls and goes on to provide more specific detail in relation to particular issues. The following is stated under the sub-heading ‘Hilton & MCG Hotel’:

Given the redevelopment of the Hilton building is unlikely, the introduction of mandatory height controls is not considered appropriate and lacks strategic merit. [The Tribunal] has stated that the Hilton has an opportunity to be developed in accordance with a set of built form outcomes. The current Thakral Holdings Ltd application (Peddle Thorp [A]rchitects), which is massed against a high blank wall of 48.5 metres and steps down to the west is considered an appropriate response to the site and its context by providing a built form transition from 14.4 metres, to 45 metres.

There is provision in the document for the Minister’s decision to agree or disagree to the recommendation and provision for her signature, however, the document was not signed by the Minister. Mr Phillips’ affidavit states that the ‘briefing was returned unsigned by the Minister’.

On 30 November 2004, Mr Phillips received a phone call from Ms Melinda Catlow, a town planner with Contour Consultants Australia (‘Contour’). Thakral had retained Contour in relation to its request for an amendment to the Melbourne Planning Scheme. Contour wished to prepare draft documents for the proposed scheme amendment which were to be considered by Mr Phillips.

On 7 December 2004, Mr Phillips met with Ms Catlow and Mr Kolomanski to discuss Contour and Thakral’s preparation of these documents. Later that day, so as to provide Contour with an example of what was required, Mr Phillips emailed Ms Catlow copies of documents used for previous amendments of the scheme. The relevant exhibit does not include the attachments of the email, specifically, the copies of documents used for previous amendments of the scheme referred to in Mr Phillips’ affidavit. Also on that day, Mr Kolomanski sent Mr Phillips a copy of documents relating to the ‘permit application made by Thakral to the [Melbourne City] Council in June 2004 for the redevelopment of the Hilton Hotel’.

On 8 December 2004, Thakral provided Mr Phillips with draft project schedules for the Melbourne Planning Scheme. The schedules showed the proposed development of the MCG Hotel, the restoration of Mosspennoch House, the building of apartments adjacent to Mosspennoch House and the refurbishment of the Hilton Hotel. The schedule indicated that, with the exception of the refurbishment to the Hilton Hotel, the development would be completed in the last quarter of 2006. The refurbishment of the Hilton Hotel, on the other hand, was to be completed in March 2006.

On 9 December 2004, Mr Phillips met once again with Mr Kolomanski and Mr Love to discuss the proposed amendment. The timing of the refurbishment and redevelopment of the Hilton Hotel was also discussed at this meeting. Mr Love asked Mr Kolomanski what undertakings Thakral could give the Victorian Government if the Minister were to approve the proposed amendment. Also on 9 December 2004, Ms Catlow emailed Mr Phillips further draft documents with respect to the proposal.

On 10 December 2004, Mr Phillips received a revised project schedule for the Hilton Hotel refurbishment. This indicated that the refurbishment would take 145 days to complete, finishing on 14 December 2005. Mr Phillips received other draft documents on that day: a draft of the Minister’s reasons for using the power of intervention under s 20(4) of the Act, an explanatory report for the amendment as well as a draft of a document to be incorporated into the Melbourne Planning Scheme.

Thakral letter dated 10 December 2004

In response to Mr Love’s enquiry of 9 December 2004 as to what undertakings Thakral could give the Victorian Government, Thakral wrote to Mr Love by letter dated 10 December 2004. The letter states:

Thakral wishes to support the 2006 Commonwealth Games by refurbishing the 5 star Hilton-on-the Park Hotel and increase the capacity with longer stay suites and apartments to be constructed over the Ballroom. The new apartment style facilities will be linked directly into the main hotel at levels 2 and 3. The majority of apartments will be sold subject to management agreements. The proceeds of the sales will be used to fund the refurbishment of the Hilton-on-the Park and the MCG Hotel.
The MCG Hotel will be refurbished and the façade faithfully restored as a priority project. It is expected to be open for Christmas 2005. The MCG Hotel will be themed to continue its long association with Australian Rules Football, where it is widely believed that the first rules of the game were drafted in the [sic] May 1859.

The letter continues:

Thakral Holdings Limited, subject to the final approval of the Board, is prepared to give the following undertakings to the Government of Victoria. The undertakings are subject to Thakral being granted all necessary and timely development/construction approvals consistent with Planning Permit Application TP04/0638 to the Melbourne City Council (in full) prior to 1 January 2005:-
1To refurbish and maintain operation of the Hilton on the Park, using its best endeavours to complete the refurbishment of the hotel prior to the 2006 Commonwealth Games. The Management Agreement currently in place with Hilton Hotels of Australia Pty. Ltd. and Hilton International is valid up to 1 April 2034, subject to usual commercial conditions. The on-going operation of the Hotel would be subject to maintenance of commercial returns acceptable to Thakral;
2To refurbish and restore the MCG Hotel in accordance with the aforementioned Planning Permit Application TP04/0638 and to facilitate the on-going operation of the MCG Hotel subject to maintenance of commercial returns acceptable to Thakral;
3To restore Mosspennoch House, in accordance with plans and specifications approved by Heritage Victoria by way of permit, for conversion to 6 residential apartments which would be offered for sale to the public.

Also on 10 December 2004, Mr Kolomanski emailed Mr Phillips (amongst the several documents he received that day) a draft elevation of a new building described as ‘Mosspennoch Stage 2.’ Mr Kolomanski stipulated that the elevation was ‘just an illustration and subject to a lot more design and consultation’.

On 11 and 12 December 2004, with these various documents from Thakral in hand, Mr Phillips prepared a draft of a document entitled ‘Planning Scheme Amendment Report’ as well as a briefing note for the Minister (the ‘Second Briefing Note’).

On 13 December 2004, Mr Phillips sent the draft of the Planning Scheme Amendment Report to Ms Catlow for review. On 14 December 2004, Ms Catlow obtained counsel’s advice on the content of the proposed amendment and forwarded it to Mr Phillips.

On 14 December 2004, Mr Phillips settled the various briefing documents. In his affidavit, Mr Phillips deposed that he forwarded to the Minister the Second Briefing Note, the Planning Scheme Amendment Report and what Mr Phillips referred to as the ‘associated documents’. These documents will be discussed in turn below.

Second Briefing Note

The purpose of the Second Briefing Note was to brief the Minister in relation to the proposed amendment, that is Amendment C101, which was

to facilitate the redevelopment and refurbishment of the Hilton on the Park Hotel and adjoining heritage buildings, by approving a section 20(4) amendment under [the Act] to approve a site specific exclusion – ‘Incorporated Document’, in the [Melbourne Planning] Scheme as a matter of State significance with reasons given for the intervention in the planning system.

The document goes on to state that the Minister had ‘recently been briefed on Council’s exhibited Amendment C93 to the [Melbourne Planning] Scheme’. It also summarised an attached ‘agreed height strategy’[9] stating, ‘the redevelopment and refurbishment of the Hilton on the Park Hotel including the MCG Hotel would be the subject of a site specific amendment’. The document also explains that a planning permit application (Application TP04/638) was made to the City of Melbourne for an almost identical scheme as proposed for approval under Amendment C101 and lists the details common to both the permit application and Amendment C101. Later, Amendment C101 is summarised with the relevant portion stating:

the amendment … insert[s] a new document titled ‘Hilton on the Park Hotel Complex Redevelopment, December 2004’, which facilitates the integrated redevelopment and refurbishment of the hotel and adjoining heritage buildings and … makes the Minister for Planning the responsible authority for the ‘Hilton on the Park Hotel Complex Redevelopment’.

[9]The agreed height strategy, attached to the exhibit, lists information for a number of sites in the following categories (data for the Hilton Hotel and MCG Hotel site are included in brackets): zoning and heritage (Business Zone 1, MCG Building nominated for HV Register, under consideration by Heritage Council); the height of existing buildings (Hilton Hotel ––69m, 20 storeys, MCG Hotel – two storeys); the existing height control (Hilton Hotel – no height control, MCG Hotel – 24m); the recommendation for height controls made under the East Melbourne Built Form Review Stage 1 conducted by Melbourne City Council (35m for both sites); proposed mandatory heights under Amendment C93 (24m for both sites); and DSE recommended heights (per the Incorporated Document).

The document goes on to list how the proposed development and amendment achieves the relevant planning policies and discusses local amenity issues, Heritage Victoria comments and consultation with key parties. On the final page, the document contains reference to the letter from Thakral to the Minister dated 10 December 2004:

Thakral Holdings Limited, owners of the Hilton on the Park Hotel, MCG Hotel and Mosspenoch site have made undertakings to the Government, by letter dated 10 December 2004 (see attached) to refurbish and restore the existing hotels and Mosspenoch House and maintain the operation of the Hilton on the Park Hotel, using its best endeavours to ensure the refurbishment is completed before the 2006 Commonwealth Games.

The document concludes with a recommendation that the Minister agree to prepare, adopt and approve Amendment C101 under s 20(4) of the Act and that the Minister should so approve the proposal by signing the document. Furthermore, the document recommends that the Minister sign the Statement of Reasons prepared in accordance with the Ministerial Powers of Intervention in Planning and Heritage Matters Practice Note (‘Practice Note’).

The Practice Note was issued in November 2004 by the Department of Sustainability and Environment and applies to Ministerial powers of intervention including that conferred by s 20(4) of the Act. The Practice Note states that it

sets out circumstances in which the Minister will consider exercising those powers of intervention and the principles that will apply in considering a request for the intervention so that the use of intervention powers is both transparent and accountable.

It also provides that, in using powers of intervention, the Minister will

make publicly available written reasons for each decision, including an explanation of how the circumstances of the matter responded to th[e] Practice Note and the legislative criteria for that action;
provide a report to Parliament at least every twelve months detailing the nature of each intervention.

The Practice Note is not prepared pursuant to a statutory power and is advisory only. In particular, it does not constitute a direction made by the Minister for Planning under ss 7(5) or 12(2)(a) of the Act.[10]

Planning Scheme Amendment Report

[10]Section 7(5) provides that ‘[t]he Minister may issue directions or guidelines as to the form and content of any planning scheme or planning schemes.’ Section 12(2)(a) provides that ‘[i]n preparing a planning scheme or amendment, a planning authority must have regard to the Minister’s directions.’

The Planning Scheme Amendment Report is a completed pro forma document. The relevant sections of the document state as follows:

The amendment is required to facilitate the refurbishment and redevelopment of the Hilton on the Park Hotel and surrounding properties and restoration of the historic MCG Hotel and Mosspennoch House, to enable their commencement and or substantial completion in time for the Commonwealth Games in 2006 …
The Amendment will facilitate the timely extension and upgrading of significant accommodation facilities in close proximity to key Commonwealth Games venues, will protect and enhance buildings of historic or cultural heritage interest and will improve the environment for Victorians and visitors to Victoria.

In response to the question ‘[o]ther documents to be signed?’ the following is specified: ‘[r]easons for decision to use the power of intervention under the Ministerial Powers of Intervention in Planning and Heritage Matters Practice Note’. The document repeats the recommendations made in the Second Briefing Note and was signed by Mr Phillips on 14 December 2004.

Associated Documents

There were six ‘associated documents’. The first is a document entitled, ‘Incorporated Document, “Hilton on the Park Hotel Complex Redevelopment December 2004”’ (‘Incorporated Document’). The document contains written provisions and a series of 67 maps marked ‘Hilton on the Park Hotel Redevelopment – TP100, December 2004’. The following statements appear on one of the maps: ‘existing Hilton Hotel tower to be refurbished internally’; ‘rear of MCG Hotel to be demolished’; and ‘front of MCG Hotel to be retained and restored’. Other maps detail the proposed new building works.

The Incorporated Document provides for the Hilton Hotel and Mosspenoch sites to be developed and used in accordance with the specific controls contained in the document. The purpose of the site specific control is described as follows:

To facilitate the redevelopment and expansion of the Hilton on the Park Hotel Complex as tourist accommodation in a timely manner in order to be available for the Commonwealth Games.
To encourage urban design solutions which recognise the significance of Wellington Parade as a boulevard entrance to Melbourne Central Activities District and the importance of the heritage buildings on the land.

The document also provides for the use and development of the land to be undertaken in stages. The approval contained in the document is stated to expire if one of the following circumstances applies (unless the periods referred to are extended by the responsible authority):

The refurbishment of the Hilton on the Park Hotel is not commenced by 1 October 2005.
The restoration of the MCG Hotel is not commenced by 1 October 2005.
The development is not completed by 31 December 2008.

The second associated document is entitled, ‘Melbourne Planning Scheme, Amendment C101, Explanatory Report’ (‘Explanatory Report’). It states:

The amendment is required to facilitate the refurbishment and redevelopment of the Hilton on the Park Hotel and surrounding properties and restoration of the historic MCG Hotel and Mosspenoch House, to enable their commencement and or substantial completion in time for the Commonwealth Games in 2006 …
The [a]mendment implements the objectives of planning in Victoria by implementing the relevant parts of Melbourne 2030, the SPPF [State Planning Policy Framework], LPPF [Local Planning Policy Framework] and MSS [Municipal Strategic Statement]. The Amendment will facilitate the timely extension and upgrading of significant accommodation facilities in close proximity to key Commonwealth Games venues, will protect and enhance buildings of historic or cultural interest and will improve the environment for Victorians and visitors to Victoria …
The economic and social benefits resulting from the amendment are substantial and include:
The provision of a five star hotel proximate to the MCG and Commonwealth Games venues in time for the commencement of the Commonwealth Games, enhancing the range of accommodation available to visitors of Victoria …

Does the amendment make proper use of the Victoria Planning Provisions?
The amendment utilises the site specific provisions which are intended for proposals that do not fit the general provisions. The urgency of the project and its value to the State in the provision of facilities for the Commonwealth Games warrant the use of these provisions.

The third and fourth associated documents are entitled ‘Melbourne Planning Scheme, Amendment C101’, and ‘Melbourne Planning Scheme, Amendment C101, List of Changes to the Melbourne Planning Scheme’. They provide the formal mechanism for amendment of the Planning Scheme and list the provisions to be amended.

Mr Phillips deposed that he was aware that an important element of the proposed development was the internal refurbishment of the Hilton Hotel. However, the refurbishment did not need to be specified in Amendment C101 or in the Incorporated Document because no permission to refurbish was required under the Planning Scheme having regard to the definition of ‘development’ in s 3 of the Act.

The fifth associated document is a single page entitled ‘Notice of Approval of Amendment to a Planning Scheme – to be presented to Parliament’. The following statement appears: ‘The amendment make[s] changes to [Schedules to the Melbourne Planning Scheme] … to insert [the Incorporated Document], which facilitates the integrated redevelopment and refurbishment of the hotel and adjoining heritage buildings’.

The final associated document entitled ‘Melbourne Planning Scheme, Notice of Approval, Amendment C101’ is similar in its terms to the fifth associated document and contains the statement quoted above from that document.

Documents executed or approved by the Minister

The Minister followed Mr Phillips’ advice by signing the Second Briefing Note on the day it was forwarded to her, 14 December 2004. On that day, she also executed or approved the following documents:

1 A document entitled, ‘Ministerial Powers of Intervention in Planning and Heritage Matters, Melbourne Planning Scheme Amendment C101, Reasons for Decision to Use Power of Intervention’ (‘Statement of Reasons’);[11]
[11]This document is more fully described: see below [50].

2 The associated document entitled ‘Incorporated Document, “Hilton on the Park Hotel Complex Redevelopment December 2004”’;

3 The associated document entitled ‘Melbourne Planning Scheme, Amendment C101, Explanatory Report’;

4 The associated document entitled ‘Melbourne Planning Scheme Amendment C101’;

5 A document entitled ‘Decision to Prepare an Amendment’;[12]
[12]This document comprises a single paragraph and contains the statement quoted from the fifth associated document: see above [47].

6 A document entitled ‘Preparation of Amendment’;[13] and

7 A document entitled ‘Adoption of Approval under Section 20(4)’.[14]

[13]This document comprises five sentences stating that the Minister has prepared Amendment C101 in accordance with s 8 of the Act and having regard to the requirements of s 12(2)(a), (aa), (ab) and (b) of the Act.

[14]This document states that the Minister exempts herself under s 20(4) because she is satisfied that ‘compliance with [the notice provisions] is not warranted; the interests of this part of Victoria make such an exemption appropriate.’

Statement of Reasons

The Statement of Reasons contains the following relevant passages:

The Minister for State and Regional Development in a letter dated 14 December 2004 has requested the Minister for Planning to amend the Melbourne Planning Scheme under the powers pursuant to Section 20(4) of the Planning and Environment Act 1987 (the Act), to facilitate the redevelopment and refurbishment of the Hilton on the Park Hotel site, East Melbourne …
The purpose of the amendment is to … insert [the Incorporated Document] … which facilitates the integrated redevelopment and refurbishment of the Hilton on the Park Hotel and adjoining heritage buildings, MCG Hotel and Mosspennoch House site …
The construction of the new accommodation and upgrade of the existing accommodation will involve an investment of approximately $86 million dollars [sic] and will have substantial positive flow-on effects for the Victorian economy.
The hotel refurbishment will be completed in time for the 2006 Commonwealth Games to be hosted in Melbourne.

The document discusses planning permit TP04/638 to the City of Melbourne ‘for an almost identical scheme’ and lists the details common to both the permit application and Amendment C101. The document continues:

The combined development plans will enable significant quality accommodation to be provided in close proximity to the prime Commonwealth Games venue at the MCG. It is a site that warrants comprehensive plans for retention of heritage components and built form infill.
The proposed expansion of the Hilton on the Park Hotel and the refurbishment will also ensure the quality accommodation is provided in a timely manner to accommodate the demands anticipated for the Commonwealth Games.
On this basis, the development is considered to be of genuine State significance which raises a major issue of State policy and public interest.

Consultation with interested parties is then discussed and the following is stated:

A number of meetings have been held with residents from East Melbourne throughout the current planning permit application process. The general public has not been consulted in respect to this amendment and the intervention.

Under the heading ‘Reasons for Intervention’ the document states that the proposed development and amendment achieves the policies of the Metropolitan Strategy – Melbourne 2030 and the Municipal Strategic Statement – City Plan, and is consistent with the State Planning Policy Framework. Reasons are given as to why this is so. The document then continues:

I am satisfied that the proposed development and the amendment raises a major issue of genuine State significance and public interest and will have significant effects beyond the immediate locality. The second and third matters set out under Criteria 1 of the Practice Note are satisfied for the following reasons: … The hotel refurbishment will be completed in time for the 2006 Commonwealth Games to be hosted in Melbourne. In turn this facility will raise the image and profile of Melbourne and improve the backdrop to the MCG and the sporting precinct surrounding …
Given the Hilton on the Park Hotel redevelopment project contributes to the accommodation offer available in Melbourne for the Commonwealth Games in a timely manner, I believe it is necessary to avoid delays which may result from the giving of notice, by exempting the project from the provisions of the Melbourne Planning Scheme.

The document concludes with extracts from the Practice Note of criteria met by the proposal.

Whilst in his affidavit Mr Phillips does not explicitly state that this document was put to the Minister, the reference to it in the Second Briefing Note presupposes that it was, in fact, put before the Minister at this time.

On 16 December 2004, Amendment C101 was given effect by a notice of approval for which Mr Love arranged gazettal. On 17 December 2004, Mr Phillips wrote to Mr Kolomanski advising Thakral of the approval of Amendment C101.

On the same day, the Minister released a media release set out in full below:

MAKEOVER FOR MCG HOTEL UNDER $86 MILLION PLAN
One of Melbourne’s most famous sporting pubs, the MCG Hotel, will become a shrine to the birth of Australian Rules Football under a $86 million redevelopment package involving three sites in East Melboure, the Minister for Planning, Mary Delahunty, announced today.
‘The MCG Hotel has long been a traditional watering hole for a post-game beer or two, but even in sports-mad Melbourne, few people realise that this site can be considered the birthplace of Australian Rules Football,’ Ms Delahunty said.
‘At this location in 1859 some of football’s pioneers first wrote down and formalised the rules of the game, laying the foundation for Melbourne’s world-famous contribution to sport,’ she said
‘This package will see this historic site will get the recognition it deserves and become a shrine to the development of our national football code.
‘The hotel, built in the early 1860s to replace a timber structure where historians believe the football rules were first documented, will be fully and authentically restored.
‘The MCG Hotel will continue to be a place of pilgrimage for sports fans as a theme pub with memorabilia and sporting displays that celebrate the birth of AFL football.’
Ms Delahunty said she had approved a site specific planning scheme amendment to permit the $86 million package of construction projects involving the Hilton on the Park Hotel and surrounding historic buildings, also owned by Hilton owners Thakral holdings Limited.
The hotel refurbishment will be completed in time for the Melbourne 2006 Commonwealth Games and will provide much-needed tourist accommodation right on the edge of Melbourne’s sporting precinct
The package includes the restoration of the MCG Hotel and construction of a 15 storey apartment and retail building behind it; the refurbishment of the Hilton on the Park Hotel to preserve its five-star status; and the restoration of historical Mosspennoch House in Clarendon Street as part of a 12 apartment complex.
‘This is an exciting development that will inject $86 million into the Victorian economy, create more than 1100 construction and permanent on-site jobs and strengthen central Melbourne’s role as a tourist and entertainment destination,’ Ms Delahunty said.
‘It has been carefully designed so that it will respect East Melbourne’s neighbourhood character, its heritage buildings and the historic Fitzroy Gardens,’ she said.
‘The new 15-storey building behind the MCG Hotel will be 45 metres high, 20 metres lower than the 65 metre high Hilton building. The tallest parts of the new building will adjoin the blank side wall of a neighbouring 53 metre high office tower, next door to the Hilton, and it will step down to four storeys where it joins the Hilton tower podium section.
‘This design will ensure that the new building does not unduly overlook or overshadow the neighbourhood, and that it is not too visually intrusive in this sensitive location.’
Ms Delahunty said she had approved Amendment C101 to the Melbourne Planning Scheme to permit the development and had used her ministerial power of intervention to exempt the amendment from the requirement under the Planning and Environment Act to give public notice of the decision.
‘This decision is in line with the Ministerial Powers of Intervention in Planning and Heritage Matters Practice Note. I am satisfied that the proposed development and the amendment raise a major issue of genuine state significance and public interest, and that it will have significant effects beyond the immediate locality,’ she said.
‘Approval of this amendment means that work can start early next year, ensuring that this project will be finished in time for the 2006 Games.’

Trial Judgment

On 11 February 2005, East Melbourne Group Inc commenced an action by writ in the Supreme Court of Victoria seeking declaratory relief, in effect, by judicial review of the Minister’s decision to exempt herself from notice requirements and adopt and approve Amendment C101.

The learned trial judge considered two main contentions raised by the plaintiff. First, whether the Minister’s decision to exempt herself under s 20(4) of the Act was invalid because it was made on the basis that the development authorised by Amendment C101 would be completed by May 2006, that is, in time to provide additional accommodation for the Commonwealth Games. Secondly, whether the Minister’s decision was invalid due to a failure to comply with the rules of procedural fairness before exempting herself from notice requirements.

In relation to the first contention, the plaintiff alleged that the Minister’s decision was occasioned by Wednesbury unreasonableness,[15] took into account irrelevant considerations and was motivated by an improper purpose. The plaintiff contended that these errors constituted a vitiating error in the exercise of the Minister’s power under s 20(4) of the Act.
[15]Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223.

The development authorised by Amendment C101 included the construction of a 15 storey building adjacent to the Hilton Hotel containing 89 apartments. The appellant argued that if the Minister relied on the proposition that the development would be completed by March 2006, in time to provide accommodation for the Commonwealth Games, then her decision was unreasonable. The appellant submitted that this proposition was so unrealistic, due to the timeframe, that no rational minister could have made such a decision.

The first respondent submitted that the proposed works were divided into a number of stages, one of which was the refurbishment of the Hilton Hotel, another was the construction of the new apartment building. The refurbishment element could reasonably be regarded as being able to be completed in time for the Commonwealth Games and would therefore contribute to the accommodation available.

The appellant submitted that if this was so, the Minister took into account an irrelevant consideration – namely a commercial consideration of a private character – in deciding to invoke the powers conferred upon her by s 20(4). The appellant also contended that the Minister’s decision was motivated by an improper purpose. This, the appellant argued, arose because Amendment C101 amounted to an approval of a development which required planning permission in exchange for an undertaking by the second respondent to carry out refurbishment works for which no planning approval was required.

The learned trial judge held that if the Minister’s decision to exempt herself from notice requirements was based on the proposition that an abbreviated process was justified to enable additional accommodation to be available for the Commonwealth Games, then the decision was ‘so devoid of plausible justification that no reasonable Minister would have taken that course’[16] because no rational Minister could have believed the works would be completed in time.
[16]Reasons [49].

However, after considering all the evidence his Honour concluded that this was not the only reason for the Minister’s decision. The trial judge looked to the public documents explaining the exercise of the Minister’s powers (that is, the official justification for the decision) and certain departmental documents to discern the real reasons for the Minister’s decision. His Honour took into account the following public documents: Amendment C101, the Explanatory Report, the Incorporated Document, the Statement of Reasons, and the Minister’s media release. He also had regard to the following departmental documents: two letters from the parent company of the second respondent dated 13 October 2004 and 10 December 2004 respectively, and the Second Briefing Note.

His Honour concluded two main purposes of the Minister’s exercise of powers to approve Amendment C101 without notification. First, to put PCH in a position where it could proceed without the normal scrutiny involved in a planning appeal hearing. This was determined on the basis that the Minister took the view that the development was economically important to the State of Victoria and she wished to promote it by making the development approval more certain. Secondly, to facilitate the refurbishment of the Hilton Hotel in a timely manner for the Commonwealth Games.

The trial judge concluded that the aforementioned purposes were not so devoid of any plausible justification that no reasonable Minister could have reached them, and were, therefore, not occasioned by Wednesbury unreasonableness. Furthermore, his Honour held that the appellant’s case did not establish where irrelevant considerations or improper purposes came into play in the Minister’s decision making process.

Grounds of Appeal

In the Further Amended Notice of Appeal, the appellant sought two declarations: first, that Amendment C101 was invalid, void and of no lawful effect; and, secondly, that those parts of the Melbourne Planning Scheme as purportedly amended by Amendment C101 are, and were, invalid, void and of no lawful effect.

The second respondent filed a Notice of Contention upholding his Honour’s decision by reason of s 39(7) of the Act,[17] or alternatively, that the proper exercise of the Court’s discretion to make orders on judicial review would dictate that the appellant’s claims be dismissed.
[17]Section 39(7) provides that an amendment that has been approved is not made invalid by failure to comply with Division 1 (‘Exhibition and Notice of Amendment’ provisions), Division 2 (provisions relating to ‘Public Submissions about an Amendment’), Division 3 (provisions relating to ‘Adoption and Approval of Amendment’) or Part 8 (relating to ‘Panels’ and including ‘Hearings’).

The appellant relied on six grounds of appeal:

1 the trial judge erred in failing to find that the Minister was bound by the official reasons for her decision;

2 the trial judge erred in finding that the contents of the departmental documents could change or colour the Minister’s official reasons;

3 the trial judge erred in according the public documents the status of political ‘spin’, as opposed to the true reasons for the Minister’s decision;

4 the trial judge erred in finding that the Minister read, or was aware of, the contents of the departmental documents because:

(a) the trial judge concluded that the Minister relied on the contents of the second respondent’s letter dated 13 October 2004, having previously found there was no evidence that the Minister had read that letter;

(b) the trial judge found that the Minister relied upon the contents of the second respondent’s letter dated 10 December 2004 in the absence of any or any proper evidence upon which such a finding could be based;

5 the trial judge erred in finding that the departmental documents revealed that the refurbishment of the existing hotel was the only part of the project which the second respondent undertook to complete prior to the commencement of the Commonwealth Games; and

6 if a real reason for the Minister’s decision was to enable the refurbishment of the Hilton Hotel, the trial judge erred by finding that the exemption was valid in the absence of a direct connection between Amendment C101 and the refurbishment.

The first three grounds essentially turn on whether the trial judge erred in having regard to, and the approach taken to, departmental documents and public documents to determine the reasonableness of the Minister’s decision. The fourth and fifth grounds of appeal concern findings of fact (including asserted inconsistent findings) made by the trial judge in relation to the departmental documents. The sixth ground asserts there was error arising from the lack of a nexus between the amendment exempted under s 20(4) of the Act and approval of the relevant project. I will discuss these issues in turn below.

A contextual approach to unreasonableness

Wednesbury unreasonableness is found where the decision was so unreasonable no reasonable person could have come to it;[18] namely, the discretion has been abused.[19] In determining the reasonableness or unreasonableness of the Minister’s decision, the learned trial judge had regard to what he described as ‘public’ and ‘departmental’ documents.[20] The appellant essentially contended that the Minister was bound by the reasons given in the Statement of Reasons and that the trial judge erred in taking into account the departmental documents.
[18]Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223.
[19]Bienke v Minister for Primary Industries and Energy (1994) 125 ALR 151, 163; Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611, [123].
[20]As to the documents considered by his Honour in each category: see above [65].

In certain review processes a superior court may take account of any material before it.[21] Generally, a court reviewing a decision on the grounds of unreasonableness may consider material before the decision maker at the time of the making of the decision.[22] It will be an issue, as here, whether the materials were before the decision maker.
[21]Craig v South Australia (1995) 184 CLR 163, 176.
[22]A-G (NT) v Minister for Aboriginal Affairs (1989) 23 FCR 536, 539-40.

The appellant cited authority that the Court is not permitted to take into account ‘additional evidence’ in examining reasons for a decision where that evidence materially alters the reasons given. However, the cases cited do not reveal an absolute prohibition on the admissibility of additional evidence.[23]
[23]Herald & Weekly Times Ltd v Correctional Services Commissioner [2001] VSC 329 (‘Herald & Weekly Times’), [33].

The English Court of Appeal decision in R v Westminster City Council; Ex parte Ermakov (‘Ermakov’)[24] provides a basis for examining the law in relation to additional evidence to support reasons for administrative decisions.Hutchison LJ (with whom the Court agreed) declined to admit additional evidence on the basis that it fundamentally altered or contradicted the original reasons provided. His Lordship held that additional evidence could be admitted in limited circumstances to elucidate correct or add to official reasons, but not to fundamentally alter or contradict them.
[24][1996] 2 All ER 302.

The English position was further considered by Burnton J in R (on the application of Nash) v Chelsea College of Art and Design (‘Nash’).[25]After reviewing the relevant authorities, including Ermakov, his Honour made the following observations:
[25][2001] EWHC Admin 538, [34].

(i) Where there is a statutory duty to give reasons as part of the notification of the decision, so that … ‘the adequacy of the reasons is itself made a condition of the legality of the decision’, only in exceptional circumstances if at all will the Court accept subsequent evidence of the reasons.
(ii) In other cases, the Court will be cautious about accepting late reasons. The relevant considerations include the following, which to a significant degree overlap:
(a) Whether the new reasons are consistent with the original reasons.
(b) Whether it is clear that the new reasons are indeed the original reasons of the whole committee.
(c) Whether there is a real risk that the later reasons have been composed subsequently in order to support the tribunal’s decision, or are a retrospective justification of the original decision. This consideration is really an aspect of (b).
(d) The delay before the later reasons were put forward.
(e) The circumstances in which the later reasons were put forward. In particular, reasons put forward after the commencement of proceedings must be treated especially carefully. Conversely, reasons put forward during correspondence in which the parties are seeking to elucidate the decision should be approached more tolerantly.

Subsequently, in R (on the application of Ashworth Mental Hospital) v Mental health Review Tribunal for West Midlands and North West Region (‘Ashworth Mental Hospital’),[26] Burnton J accepted that this observation was expressed too widely and that, as a general rule, evidence that merely elucidates original written reasons will be permitted regardless of whether the reasons are required by statute. The distinction made in Nash between statutorily and non-statutorily required reasons was, however, maintained.[27]
[26][2001] EWHC Admin 901, [56].
[27]See Ashworth Mental Hospital [2001] EWHC Admin 901, where, as in Ermakov, reasons were required by statute. Additional reasons going beyond mere elucidation were not accepted. Cf R (on the application of B) v Merton London Borough Council [2003] 4 All ER 280, [43] where Burnton J distinguished Ermakov on the basis that reasons were not required by statute, then applied the non-statutory test described, [34(ii)] in Nash to accept the additional evidence as to the ‘true reasons’ for the decision.

Nash has not been considered by the courts in Australia in this context.[28] Ermakov has been considered twice in Australia, by Eames J of the Supreme Court of Victoria on both occasions. In Herald & Weekly Times v Correctional Services Minister (‘Herald & Weekly Times’),[29] his Honour considered a request by a journalist, an employee of the plaintiff newspaper, to visit a prisoner at Barwon Prison to interview him for a newspaper article. The defendant refused the request stating the reasons in a letter to the plaintiff and referring to a draft ‘media protocol’ published by the defendant some months prior. The media protocol stated that interviews would not be considered with persons imprisoned for the category of offence of which the subject prisoner was guilty. Nevertheless, in affidavit evidence the decision maker expressed that this did not reflect the approach taken and outlined the range of considerations to which she had regard in refusing the request.
[28]The case was cited on an unrelated point in Griffith University v Tang (2005) 221 CLR 99.
[29][2001] VSC 329.

Eames J held that the affidavit containing the additional evidence amounted to an expansion or elucidation of the reasons stated in the letter, not a fundamental alteration to the original reasons.[30] Therefore, in keeping with the principles in Ermakov, it was permissible to have regard to them in the appeal.
[30]Ibid [37].

Eames J considered Ermakov on a second occasion in Walker v Registrar of Titles,[31] a case concerning reasons provided by the defendant in refusing to register a body corporate plan. Broader reasons were provided for the refusal by affidavit and in both written and oral submissions. His Honour held that ‘the range of considerations and arguments advanced by the registrar, to a degree at least, went beyond the terms of the reasons for decision which [the decision maker] had delivered to the plaintiffs’.[32]
[31](2001) 8 VR 618.
[32]Ibid [25].

Whilst not explicitly outlining the breadth of the original reasons in comparison with the additional reasons, his Honour held that the latter merely elucidated, rather than fundamentally altered the former. Thus, his Honour had regard to the additional material.

For present purposes Ermakov must be distinguished for several reasons. First, the departmental documents do not fundamentally alter or replace the official reasons. The learned trial judge held that the public documents put a gloss or ‘spin’ on the real basis for the decision, possibly to avoid or minimise public criticism.[33] His Honour concluded there were two reasons for the Minister’s decision to exercise her powers under s 20(4):

the main purpose was to put PCH in a position where it could proceed with the expansion of the Hilton Hotel without having its proposal subject to the normal scrutiny involved in a planning appeal hearing … [the] second purpose [was] that the approval would facilitate the refurbishment of the Hilton Hotel in a timely manner for the Commonwealth Games.[34]

[33]Reasons [62].

[34]Ibid [63].

The public documents may indeed put a gloss or ‘spin’ on the reasons for the decision, however, this does not amount to a fundamental alteration or contradiction. Rather, it simply amounts to a change in the presentation or focus of the reasons. Indeed, careful reading of all the departmental documents and the official reasons reveal a strong consistency in approach. The differences are not of substance but largely style.

Ermakov must also be distinguished on a second basis. The relevant Act in that case created a statutory obligation to give reasons, a factor given decisive weight by the Court which held that in situations where reasons were required by statute and no reasons or wholly deficient reasons were provided the appellant was, prima facie, entitled to have the decision quashed.[35] There was no allegation of unreasonableness. Rather the appeal concerned compliance with the statutory requirement to provide reasons and whether the reasons supplied were deficient or could be altered by new and contradictory evidence.
[35][1996] 2 All ER 302, 316.

On the present facts there is no statutory obligation for the Minister to give reasons. The Statement of Reasons was prepared in response to the Practice Note issued by the Department of Sustainability and Environment. This document provided that, in using the powers of intervention, the Minister would make written reasons for each decision publicly available.[36] A deficiency in the Minister’s official reasons would not result in their being defective in an Ermakov sense.
[36]Reasons [55].

The third, and most important distinction between Ermakov and the present case is that, in Ermakov, the additional evidence was affidavit evidence brought into existence after the decision had been made. It was, therefore, not before the decision maker at that time. This is a critical difference.

The analogy drawn by counsel for the appellant between departmental documents and ‘additional evidence’ is incorrect. The departmental documents are not additional evidence, brought into existence after the decision was made, which contradicts the decision maker’s unambiguous reasons,[37] amounts to a fundamental alteration to the original reasons,[38] or introduces entirely new grounds for the decision. [39] They are documents that existed prior to the decision being made by the Minister.
[37]R v Licensing Authority for Goods Vehicles for Metropolitan Traffic Area; ex parte B E Barrett Ltd [1949] 2 KB 17, 22 (‘Barrett’).
[38]Ibid; Herald & Weekly Times [2001] VSC 329, [37].
[39]R (on the application of Richards) v Pembrokeshire County Council [2004] EWCA Civ 1000, [63] (‘Pembrokeshire’).

Similarly, the contention that a division must be made between public documents which may be taken into account, and departmental documents which may not is, in the factual circumstances here prevailing, artificial. A distinction between departmental and public documents is not relevant to determining the process of reasoning behind the Minister’s decision.

The merits of the Minister’s decision itself are not in issue here, rather it is the legality of that decision to which a court undertaking judicial review must direct its enquiry. It is therefore necessary to examine the process by which the Minister arrived at her decision to determine if the power conferred by s 20(4) was validly invoked and the decision was reasonable. Thus, a more appropriate distinction to draw is between evidence that was before the decision maker, and was thus relevant to the decision being made, and evidence that was not. It was this distinction which the learned trial judge made. His Honour concluded that, as a matter of logic, all evidence which is relevant should be considered.[40] On this basis, his Honour looked to the public documents explaining the exercise of the Minister’s powers, then considered those departmental documents relevant to the Minister’s decision.
[40]Reasons [62].

The distinction between factors that were taken into account by the decision maker and factors that were not has been recognised by the courts. In R (on the application of Richards) v Pembrokeshire County Council (‘Pembrokeshire’),[41] Neuberger LJ held that the admissibility of additional evidence turns on whether the decision maker themselves took the evidence into account. In Attorney-General for the Northern Territory v Minister for Aboriginal Affairs,[42] Lockhart J stated:

In the case of some grounds of review (for example, if the decision maker failed to take into account a relevant consideration) … or took into account an irrelevant consideration … it is difficult to see the relevance of material not before the decision maker. Other grounds of review (for example, unreasonable exercise of the power …) will generally, lead to the evidence consisting primarily of the material before the decision maker.

[41][2004] EWCA Civ 1000, [61].

[42](1989) 23 FCR 536, 539-40.

This passage was cited with approval by Weinberg J in Australian Retailers Association v Reserve Bank of Australia[43] and Sackville J in McCormack v Commissioner of Taxation.[44]In Herald & Weekly Times, the question of whether to admit affidavit evidence to elucidate reasons turned on whether the evidence was taken into account by the decision maker. Eames J held:

If I concluded that these were indeed relevant considerations, and that they had been taken into account at the time but had, for whatever reason, not been identified to the applicant at the time, then there would be an air of unreality if I was to disregard those considerations.[45]

[43](2005) 148 FCR 446, [455].

[44](2001) 114 FCR 574, [37].

[45][2001] VSC 329, [38].

On the present facts, the learned trial judge was required to determine the reasonableness of the Minister’s decision. To undertake this enquiry, it was necessary for his Honour to have regard to the information before the Minister to ascertain the basis for her decision.To say that only the publicly available documents should be incorporated into an assessment of the Minister’s decision is to disregard substantial information that was before her in making that decision.We are not looking here at the reasonableness of the decision in the mind of a member of the public, but the reasonableness of the decision that the Minister made based on the evidence before her.

The learned trial judge was permitted to look to the departmental documents if those documents were relevant and taken into account by the Minister when making the decision. The task of the trial judge was not to determine whether the Minister’s decision was right or wrong, but whether it was reasonable. In this respect, the departmental documents were of assistance. In any event, before the trial judge, the appellant put the departmental documents into evidence,[46] opened at trial by reference to those documents,[47] and conceded that the majority of the departmental documents were before the Minister at the time of the impugned decision.[48]
[46]Affidavit of M A Wood sworn 26 April 2005, Exhibit MAW 8 and MAW 23.
[47]Transcript 47–8; Transcript 97–8.
[48]Transcript 97–8.

Were all of the departmental documents considered by the learned trial judge before the Minister?

On the basis that the learned trial judge was correct in considering the documents that were taken into account by the Minister in making her decision, it is now necessary to turn to the question of whether the documents that the trial judge considered were before the Minister at that time.

In clarifying whether all of the departmental documents were before the Minister at the time of the decision, it is to be observed that the Second Briefing Note was signed by the Minister and refers to the ‘attached’ letter dated 10 December 2004. At trial, the appellant conceded that it should be inferred that the letter was in fact attached to the Second Briefing Note.[49] The appellant’s ground 4(b) thus falls away. It is not disputed that these two documents were in the mind of the Minister at the time of the decision. The First Briefing Note and the letter dated 13 October 2004 are, however, another matter.
[49]Transcript 97; above [93].

In his affidavit, Mr Phillips deposed that on or about 19 October 2004 he was asked (by whom is not stated) to advise the Minister in relation to the requests by the respondent included in the letter dated 13 October 2004. In response, on 26 November 2004, he authorised a briefing document to the Minister, the First Briefing Note.[50] This document included the following reference to the letter of 13 October 2004:

Thakral Holdings Ltd, the owners of the Hilton and MCG Hotels and Mosspenoch sites, have recently written to you expressing their concern with the planning process of refurbishing and redeveloping the sites. Thakral Holdings Ltd believes this matter warrants the intervention of the State Government to ensure that these assets are preserved and enhanced, particularly with many 2006 Commonwealth events to be held at the adjacent MCG, Melbourne Park [T]ennis complex and Olympic Park Athletic complex. The Department is consulting with other parts of government on the strategic significance of this proposal.

[50]See above [16]–[20].

The purpose of the First Briefing Note was to brief the Minister on Amendment C93 to the Melbourne Planning Scheme which proposed to introduce mandatory height controls in some areas. Mr Phillips deposed that the document was returned unsigned by the Minister. At trial, counsel for the appellant conceded that the First Briefing Note was put before the Minister.[51] It was therefore reasonable for the learned trial judge to conclude that the Minister read or was aware of the document and to consider it as being relevant to the Minister’s decision.
[51]Transcript 47.

Moving to the letter dated 13 October 2004, the question of whether or not the Minister read or was aware of this document was not raised at trial. The document was exhibited to the affidavit of Mr Phillips and the affidavit of Ms Margaret Ann Wood, President of East Melbourne Group Inc. The document was exhibited to Ms Wood’s affidavit to dispute claims made in it concerning the resources available to East Melbourne Group Inc and the reaction of residents at a public meeting presenting concept plans for the site. Nevertheless, the appellant read almost the entire letter into evidence during its opening[52] and did not raise the issue of whether or not the Minister read or was aware of the letter.
[52]Transcript 48–57.

Parties on appeal are bound by the conduct of their case at trial.[53] The appellant cannot now argue that the trial judge erred in concluding that the Minister read or was aware of the letter, when the letter was addressed to the Minister personally, date stamped as received by her office on 15 October 2004, and the issue was not raised at trial. If the issue had been raised at trial, the respondents would have had the opportunity to address it at that time. To allow it now would offend the principle in Whisprun Pty Ltd v Dixon.[54]
[53]Coulton v Holcombe (1986) 162 CLR 1; Whisprun Pty Ltd v Dixon (2003) 200 ALR 447.
[54](2003) 200 ALR 447, [51]; Park v Brothers (2002) 222 ALR 421, [34].

I do not accept the appellant’s submission that the approach of the learned trial judge to this letter demonstrates inconsistency. The appellant argued that his Honour concluded that the Minister relied on the contents of the letter of 13 October 2004 after having held that there was no evidence that the Minister had read the letter. This description of his Honour’s reasoning is not accurate. His Honour stated, ‘[t]here is no evidence as to whether the Minister for Planning read the PCH letter of 13 October 2004. However the Minister’s department was clearly aware of the letter.’[55] His Honour later held that the letter was relevant to explaining the Minister’s decision and included it in his consideration of the departmental documents.[56] His Honour did not find there was no evidence that the Minister had read the letter, rather there was no evidence as to whether the Minister read the letter. The two propositions are quite different. No inconsistency is demonstrated in the learned trial judge’s approach.
[55]Reasons [32].
[56]Ibid [61].

Although the trial judge appears to have left open the question of whether the Minister read or was aware of the letter, it was open to his Honour to draw an inference, based on the facts before him, that this was so. This Court is in as good a position as the trial judge to ‘decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge.’[57] The fact that the letter was addressed to the Minister and stamped as received by her office supports an inference that the Minister was, at the very least, aware of the letter. No evidence was led to suggest otherwise and this was not raised as an issue at trial.
[57]Warren v Coombes (1979) 142 CLR 531, 551–2.

Commonsense dictates that the letter of 13 October 2004 was before the Minister. Short of the Minister being called at trial to give evidence as to precisely what was before her, what she read and what she took account of in the intellectual process of making the decision, one could not be absolutely, unequivocally certain that the letter was taken into account. However, this was not a case of reverse onus of proof or the imposition of a special standard of proof. Logically, in the circumstances, the letter was seen by the Minister. A fair inference can be drawn that it formed part of her reasoning process.

In addition, the appellant pleaded its case on the basis of the public documents, but conducted its case on the basis of the public and the departmental documents. To reiterate, the appellant put the departmental documents into evidence, opened its case by including them and made the important concession at trial that the majority of the documents were before the Minister. Indeed, the appellant did not raise the issue of whether the letter dated 13 October 2004 was before the Minister at the time of the impugned decision. Cases are decided on the evidence and the way they are conducted at trial, not only on the pleadings.

It is therefore permissible to consider the letter of 13 October 2004 as part of the analysis of the departmental documents taken into account by the Minister in arriving at her decision. If, however, the letter were to be excluded from the analysis, the position does not change.

The significance of the letter of 13 October 2004 to the reasoning of the learned trial judge was limited. His Honour held that the departmental documents

reveal that the only aspect of the development which PCH was undertaking to complete before the Commonwealth Games was the refurbishment of the existing hotel: an aspect of the development that did not require planning permission. They also reveal that before agreeing to the amendment the Minister obtained an undertaking from PCH that, if the amendment was approved, PCH would refurbish and maintain operation of the Hilton Hotel, using its best endeavours to complete the refurbishment prior to the 2006 Commonwealth Games.[58]

[58]Reasons [61].

These findings are wholly contained within the letter dated 10 December 2004.[59] The Second Briefing Note, signed by the Minister, brings this information to her attention.[60] Therefore, even if the letter dated 13 October 2004 is excluded from the analysis, the learned trial judge’s findings stand.
[59]See above [26]–[27].
[60]See above [34].

Following a discussion of the public documents only, the learned trial judge came to the conclusion that these documents on their own created an ‘overall impression’ that the exemption was ‘necessary for the purpose of providing additional accommodation for the Commonwealth Games.’[61] However, when all the documents, both public and departmental, are taken into account this is not the impression or conclusion that his Honour reached.[62] This does not indicate that the overall impression, or reason, based on the public documents alone is at least a reason for the exemption decision. Such a conclusion would require an assumption that, in looking at half of the picture, one can determine a reason and then, by looking at the whole picture, one can determine an additional reason. This is not the correct approach and it is not the course taken by the learned trial judge.
[61]Reasons [60].
[62]Ibid [63].

His Honour reached a conclusion about the overall impression created by the public documents, but held that this was not the true picture and went on to consider the departmental documents to discern the reasons for the decision. In determining reasons for a decision, it is necessary to look at all the relevant evidence and arrive at a conclusion. It is not correct to compartmentalise the evidence and use a particular part of it to discern a reason, then other evidence to discern another reason. The evidence must be looked at as a whole to determine the reasons for the decision.

On this basis, no error is demonstrated in the approach of the learned trial judge. It was open for his Honour to have regard to the documents that were taken into account by the Minister at the time of the decision, as presented in evidence by the parties, whether they were departmental documents or public documents. This is what his Honour did. In terms of the exercise of discretion conferred by s 20(4), if the documents bore on the exercise of the discretion, they are relevant to an assessment of the reasonableness of the decision.

The distinction between merits review and judicial review

Would the decision be vitiated if refurbishment of the Hilton Hotel was a purpose of the Minister’s decision?

The Minister relied upon the assumed benefit of refurbishment of the Hilton Hotel in time for the Commonwealth Games as part of her reason for the exemption decision. In our opinion, if that was an improper purpose, or if it was a circumstance irrelevant to the exercise of the discretion, the decision would be vitiated. It would make no difference whether, in Australia, the tests for determining the impact of improper purpose and irrelevant consideration to some extent diverge. In light of the Minister’s repeated reference to refurbishment of the Hilton Hotel as part of the reason for her exemption decision, it would not be sensible to say that it had not played a large operative role in her decision. That would be so regardless whether the Minister also brought to bear other and relevant considerations. On the Minister’s account, refurbishment of the Hilton and the expansion of accommodation, each in time for the Commonwealth Games, drove her decision. A fortiori, it could not be said that it was so insignificant a consideration as not to have materially affected the decision.

Was the exemption decision made for an improper purpose or having regard to an irrelevant consideration?

The precise way in which the appellant developed the argument now under consideration was as follows:

It is submitted that under section 20(4) of the Act there must be a direct nexus between the planning scheme amendment which is exempted from the requirements of the Act inviting public involvement, and the matter which is of State or regional significance, which is identified as the relevant test for granting exemption in the Ministerial Practice Note.
In short, the planning scheme amendment which is the subject of exemption must be the mechanism which approves the project which is of State or regional significance.
If the matter of State or regional significance was the entirety of the development authorised by the Amendment (as stated in the official reasons), the necessary nexus did exist because that development required planning approval and was in fact approved by the Amendment.
However, if it is permissible to look beyond the official reasons and identify a real reason for the matter being of State or regional significance as being the refurbishment of the Hilton Hotel in time for the Commonwealth Games, the required nexus did not exist. This is because planning approval was not required for the refurbishment of the hotel. The Amendment did not approve, expedite or otherwise facilitate the refurbishment of the hotel. The direct relationship between the Amendment and the project which is required before an exemption under section 20(4) of the Act can be granted did not exist.

The trial judge rejected the appellant’s contention that, if a reason for the exercise of the Minister’s power of exemption was to facilitate the refurbishment of the Hilton Hotel in a timely manner for the Commonwealth Games, the Minister took into account an irrelevant consideration. His Honour rejected a related argument, that the Minister had made the decision to exempt for an improper purpose, by approving development which required planning permission in exchange for an undertaking by PCH to undertake certain works for which no planning permission was required. In so concluding, his Honour recognised that private economic considerations are not relevant in the exercise of discretions pursuant to the Act. He referred to the judgment of Stephen J in Kentucky Fried Chicken Pty Ltd v Gantidis and Anor.[194] In that case, after observing that it was proper planning purpose to take into account an existing communal benefit which might be placed in jeopardy by a proposed development, Stephen J observed that -

It does not cease to be so because the profitability of individual existing businesses are at one and the same time also threatened by the new competition afforded by that new development. However, the mere threat of competition to existing businesses, if not accompanied by a prospect of a resultant overall adverse effect upon the extent and adequacy of facilities available to the local community if the development be proceeded with, will not be a relevant town planning consideration.

The trial judge further observed , and we see no error in this:
Similarly development undertaken by a private company may have an effect on the overall extent and adequacy of facilities available to the community (or have some other public benefit); and this will be a relevant planning consideration, notwithstanding that it will also be of benefit to that private company.[195]

[194](1979) 140 CLR 675, 687.

[195](2005) 12 VR 448, 471 [66].

But the trial judge then concluded that ‘this principle does not cease to apply if the beneficial development is not the development the subject of the approval, provided it is an effect of the approval of the development’, citing for that proposition his decision in Australian Conservation Foundation v Latrobe City Council[196]His Honour explained what he there decided as follows:

I held that a panel appointed under the Act to consider an amendment to facilitate the extension of the brown coal fired Hazelwood Power Station must consider submissions about the impact of greenhouse gases. This was so notwithstanding that the amendment only made minor changes to the relevant planning scheme: as an indirect effect of the amendment was to facilitate the continued use of the power station and this would have a consequence on the generation of greenhouse gases.[197]

[196][2004] VCAT 2029.

[197](2005) 12 VR 448, 471-471, n 26.

Thus his Honour held in the present case that the fact that the Minister took into account the circumstance that the refurbishment of the Hilton Hotel was made an effect of the approval of the development, by the undertaking given by PCH and by condition 30 of the approval, did not invalidate the decision.

The final stages of this process of reasoning are not without their difficulties.

First, the refurbishment was not a necessary effect of the approval, for, as we have already observed, PCH did not give an unqualified commitment to undertake the same.

Second, the principle that the beneficial development need not be the development the subject of the approval, provided it is an effect of the approval of the development, did not derive any support from either of the cases to which his Honour referred. They were both concerned with the direct and immediate consequences to the public benefit of the development in dispute. Any private benefit was incidental to the development under consideration.

In the event, in our opinion, the principle formulated by the trial judge depends for its acceptance upon a determination of the nature, scope and purpose of the relevant legislation from which the Minister’s power emanated.

Where a statute requires the ‘public interest’ to be taken into account, a discretionary value judgment made by a reference to undefined factual matters is normally involved.[198] In O’Sullivan v Farrer and anor[199] Mason CJ, Brennan, Dawson and Gaudron JJ observed that the expression ‘in the public interest’, when used in a statute, classically imported a discretionary value judgment to be made by reference to undefined factual matters which were

confined only ‘in so far as the subject matter and the scope and purpose of the statutory enactments may enable … given reasons to be [pronounced] definitely extraneous to any objects that the legislation could have had in view.

That was in accordance with the view expressed by their Honours that where a power to decide is conferred by statute, a general discretion, confined only by the scope and purpose of the legislation, will ordinarily be implied where the context provides no positive indication of the considerations by reference to which the decision is to be made.

[198]Halsbury’s Law of Australia, [10]-[2177].

[199](1989) 168 CLR 210, 216.

Questions about ‘the public interest’ will therefore rarely have only one dimension.[200] Whether a particular course will be ‘in the public interest’ will often involve judgement about which reasonable minds may well differ.
[200]McKinnon v Secretary, Department of Treasury (2006) 80 ALJR 1549, 1561–2, [55] (Hayne J).

In Re Minister for Resources; Ex parte Cazaly Iron Pty Ltd[201] the Minister terminated an application for an exploration licence under s 111A(1) of the Mining Act 1978 (WA), which empowered the Minister to do so if satisfied ‘on reasonable grounds in the public interest’ that the application should not be granted. The appellant contended that the Minister was not permitted to have regard to matters extraneous to the application for an exploration licence and could not have regard to the private interests of third parties. Buss JA, with whom Pullin and Wheeler JJA agreed, held that the term ‘public interest’ was inconsistent with an intention by Parliament to confine the matters which the Minister was entitled to take into account to the land to which the application related.
[201](2007) 34 WAR 403.

In Re Minister for Mines; Ex parte Haoma North West No Liability[202] the Full Court of the Supreme Court of Western Australia had earlier reached a similar view - that a requirement that the Minister be satisfied in the public interest before exercising a discretion did not limit the basis upon which the Minister could exercise that discretion to considerations arising solely in relation to the land the subject of the application in question.
[202](Unreported, Full Court of the Supreme Court of Western Australia, 24 November 1992 – Pidgeon, Nicholson and Walsh JJ).

Later in these reasons we advert to the importance which the Act attaches to the notification process. In our opinion, fairly read, the Act does not now relegate such importance to a position of lesser significance by contrast with the desirability of development. We do not see the answer to the present question in a proposition to the contrary.

On the other hand, considering the language of s 20(4), and allowing for the importance of all the specified objectives of planning in Victoria, and of the planning framework established by the Act, we do not think it can be said that a reason for exemption must necessarily be confined to the interests of Victoria in the land the subject of the proposed amendment. We think that a benefit accruing in the interests of Victoria - not being a benefit which will accrue from the subject land itself – might in some cases legitimately be relied upon by the Minister in making a decision to exempt. Whether reliance will be legitimate in a particular case, in our opinion, will be a matter of fact and degree.[203]
[203]Whether and how a particular exercise of discretion could be successfully challenged are questions for another day.

Allowing that every provision must be considered in its own context, that conclusion is consistent with the Western Australian authorities to which we have referred.

The appellant contended, in substance, that it could never be permissible to found a decision to exempt upon an assumed benefit to Victoria which would not be directly conferred by the amendment – as distinct from a benefit which would be an indirect consequence of the amendment. On its approach, a direct consequence would be a development permitted by the amendment; and an indirect consequence would be the achievement of an (assumed) beneficial redevelopment of land which did not oblige the (or any) planning scheme amendment.

Because we consider that the appellant’s contention cannot be accepted as an absolute proposition, its attack founded upon improper purpose and irrelevant consideration fails. The appellant’s attack was not that recourse to an indirect consequence might in some cases be permissible – though not in this case; but rather that such recourse could never be permissible. No occasion arises, therefore, to consider the merits or otherwise of the Minister’s reliance upon what we have called the indirect consequence in making her exemption decision.

The privative provision

Absent an exercise of discretion under s 20(4), the notification process, and that which follows it, must precede the adoption and approval of an amendment. The appellant contends that, the decision to exempt being vitiated, the amendment is invalid, and of no lawful effect. It seeks a declaration to that effect.

By notice of contention, PCH relied upon s 39(7) of the Act. Counsel submitted that the sub-section (subject to presently irrelevant exceptions) protects an approved amendment from invalidity in the event of non-compliance, inter alia, with Division 1 or 2 of Part 3. Accordingly, if it was the fact that the exercise of the discretion was vitiated, the validity of the amendment remained unaffected. Alternatively, the fact of an exemption wrongly determined should not lead to a declaration of invalidity in the proper exercise of the Court’s discretion to refuse such relief.

Section 39 is relevantly as follows:

Defects in procedure
(1)A person who is substantially or materially affected by a failure of the Minister, a planning authority or a panel to comply with Division 1 or 2 or this Division or Part 8 in relation to an amendment which has not been approved may, not later than one month after becoming aware of the failure refer the matter to the Tribunal for its determination.
…
(4)The Tribunal may determine a matter referred to it under this section and may do any one or more of the following –
(a)make any declaration that it considers appropriate;
(b)direct that –
(i)the planning authority must not adopt or approve the amendment or a specified part of the amendment; or
(ii)the Minister must not approve the amendment or a specified part of the amendment –

unless the Minister, planning authority or a panel takes action specified by the Tribunal.

(5)In exercising its jurisdiction under this section the Tribunal cannot vary a decision made in relation to a matter referred to it or set aside that decision and make a decision in substitution for the decision so set aside.

* * * *
(7)An amendment which has been approved is not made invalid by any failure to comply with Division 1 or 2 or this Division or Part 8.
(8)Except for an application under this section, a person cannot bring an action in respect of a failure to comply with Division 1 or 2 or this Division or Part 8 in relation to an amendment which has not been approved.

The section, broadly, addresses two situations: the first, where an amendment has not been approved – in which case recourse to the Tribunal is available; the second, where an amendment has been approved. Only sub-s(7) relates to the latter. It addresses the situation where an amendment has been approved despite there having been a failure to comply with any of Division 1 of Part 3 (which relates to the exhibition and notice of a proposed amendment), Division 2 (which relates to public submissions about an amendment and the way in which they are to be dealt with), and Division 3 (which is concerned with the adoption and approval of amendments). It also deals with want of compliance with Part 8 of the Act, which is concerned with the appointment of Panels under the Act and hearings conducted by such Panels.

The objectives of the planning framework established by the Act, set out in s 4(2), include:
(h)   to establish a clear procedure for amending planning schemes, with appropriate public participation in decision making;
(i)    to ensure that those affected by proposals for the use, development or protection of land or changes in planning policy or requirements receive appropriate notice;
(j)    to provide an accessible process for just and timely revue of decisions without unnecessary formality;
The exercise by the Minister of the power to exempt herself from the notification requirements of the Act had drastic consequences. It meant, because no notification of the proposed amendment had to be given, that no right to make submissions existed, and that the public was denied participation in the process which would lead, in conventional circumstances, to the Minister’s approval or refusal to approve the amendment. In short, s 20(4) conferred upon the Minister a discretion to follow a process which departed from a number of the stated objectives of the Act.

It is integral to the rule of law that persons affected by administrative decisions should have access to the courts to challenge those decisions. So privative clauses are strictly construed.[204]
[204]Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597, 614, [48] (Gaudron and Gummow JJ); Re Minister for Immigration and Multicultural Affairs; ex parte Miah (2001) 206 CLR 57; SAAP v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 228 CLR 294; Plaintiff S157/2002 v The Commonwealthof Australia (2003) 211 CLR 476; Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/2002 (2003) 211 CLR 441.

In our opinion, there is nothing express, or necessarily to be implied, in the legislative instrument which requires s 39(7) to be construed so as to deny a court the capacity to examine, for error of the kinds alleged in this proceeding, a decision to exempt a proposed amendment from the notification requirements of the Act; or to deny a court the power to make orders which strike down the consequences of a fatally flawed exercise of the exemption discretion. Section 39(7) is concerned with a ‘failure to comply’ with the specified parts of the Act. In our opinion, that strongly supports a conclusion that the subsection addresses, as the heading to the section states, ‘defects in procedure’. Further, only where an amendment has not been approved does the section expressly state, by sub-s (8), that a person cannot bring an action in respect of non-compliance with, inter alia, Divisions 1 or 2 of Part 3.[205] Why permit action if it could lead nowhere?
[205]We leave for another day the question whether sub-ts(8) would preclude a right to seek and obtain relief for jurisdictional error.

In Grollo Australia Pty Ltd v Minister for Planning,[206] Brooking J concluded that, where the Minister had exercised the power of exemption, the subsequent exercise of the power to adopt and approve the scheme was not subject to the principles of natural justice. Although it was not necessary to his Honour’s decision, he considered the scope of s 39(2),which was in the same form as the present s 39(7). His Honour regarded the protection conferred by the provision as extending to ‘a case of total failure to comply, at all events where that is not a knowing failure’. But it does not appear to have been argued that want of compliance constituted jurisdictional error which vitiated the exercise of the discretion. We do not regard his Honour’s observations about the scope of the provision as extending so far.
[206][1993] 1 VR 627, 633-634.

The trial judge rejected the contention of PCH that s 39(7) rendered the validity of the amendment immune from challenge and precluded the granting of the declaratory relief sought. He held that the provision was concerned with procedural non-compliance but did not protect a decision that was based upon ‘jurisdictional error or substantive ultra vires’.[207] His Honour explored the predecessors of the provision which, though differently worded, were plainly directed to ‘defects in procedure’ as the heading to s 39 states. For the reasons which we have stated, and also substantially for the reasons given by his Honour, we agree with him that s 39(7) only addresses non-compliance with procedural requirements; and that it does not apply to decisions which are tainted by jurisdictional error. The provision, when considered within the context of the whole legislative instrument,[208] is not intended to remove the Court’s capacity to ensure that administrative powers are exercised according to law.[209] In consequence, the end product of a fatally flawed exercise of the exemption discretion is not protected against relief at the instance of a person with sufficient standing.
[207]East Melbourne Group Inc v Minister for Planning (2005) 12 VR 448, 482 [101].
[208]R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598, 614-617 (Dixon J).
[209]Enfield City Corporation v Development Assessment Commission (2000) 199 CLR 135, 157 (Gaudron J); Saap v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 215 ALR 162, 211 (Hayne J).

Orders

In our opinion, the appeal should be allowed, the orders below set aside, and declarations made that the amendment, and those parts of the Melbourne Planning Scheme purportedly affected by the amendment, are respectively invalid, void, and of no legal effect.

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[2008] VSCA 217

31 October 2008