HICK and WESTERN AUSTRALIAN PLANNING COMMISSION - [2010] WASAT 163

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

STREAM: DEVELOPMENT & RESOURCES

ACT: PLANNING AND DEVELOPMENT ACT 2005 (WA)

CITATION: HICK and WESTERN AUSTRALIAN PLANNING COMMISSION [2010] WASAT 163

MEMBER: MR J JORDAN (MEMBER)

HEARD: 9 AUGUST 2010

DELIVERED : 9 NOVEMBER 2010

FILE NO/S: DR 113 of 2010

BETWEEN: CHARLES HICK
MARY HICK
Applicants
AND
WESTERN AUSTRALIAN PLANNING COMMISSION
Respondent

Catchwords:

Town planning - Subdivision - Refusal - Rural zoned land under local planning scheme Proposed amalgamation of 10.4 hectare lot with house and sheds with a 167.5 hectare grazing lot - Proposed subdivision of resultant lot to create 34.2 hectare lot and 143.7 hectare lot with the house and sheds - State Planning Policy 2.5 and Development Control Policy 3.4 objective of maintaining productive agricultural land Circumstances where rural subdivision might be allowed under Development Control Policy DC 3.4 Shire of Plantagenet Planning Vision for the locality - Homestead lots - Use of proposed lots for productive agriculture - Conflict of land uses - Whether approval would set an undesirable precedent for subdivision of rural lots

Legislation:

Planning and Development Act 2005 (WA), s 251(1)
Shire of Plantagenet Town Planning Scheme No 3, cl 7.6

Result:

Application for review allowed
Refusal of respondent set aside and conditional approval granted for amalgamation of Lot 150 with Lot 151 and subdivision of the resultant lot into two lots with smaller lot to be not less than 40 hectares

Category: B

Representation:

Counsel:

Applicants: Ms D Baesjou (Town Planner)
Respondent: Mr J Misso

Solicitors:

Applicants: Ayton Baesjou Planning
Respondent: State Solicitor's Office

Case(s) referred to in decision(s):

Goldin & Anor and The Minister for Transport Administering the Ports Corporation and Waterways Management Act 1995 (2002) 121 LGERA 101
Ingram & Anor v Western Australian Planning Commission [2003] WASCA 77
Nicholls and Western Australian Planning Commission [2005] WASAT 40; (2005) 149 LGERA 117

REASONS FOR DECISION OF THE TRIBUNAL:

Summary of Tribunal's decision

This matter involved an application for review of a refusal by the Western Australian Planning Commission to grant approval for the amalgamation of a 10.4 hectare rural lot with house and sheds with a 167.5 hectare grazing lot, and the resubdivision of the resultant lot into a vacant 34.2 hectare rural lot and a 143.7 hectare grazing lot with the house and sheds. The lots are located at Chorkerup Road, Narrikup between Mount Barker and Albany.
The Western Australian Planning Commission refused the amalgamation and resubdivision, as it considered the resultant lots would be in conflict with the objectives of its State planning policy and development control policy adopted to protect against ad hoc fragmentation of rural land and the loss of agricultural land. The Western Australian Planning Commission was also concerned the proposal would set an undesirable precedent for the fragmentation of Rural zoned land in the locality.
The Tribunal found, from consideration of the attributes of the site and land uses in the district, that the proposed 34.2 hectare lot had potential to be a productive agricultural holding and that there was likelihood that this potential would be utilised rather than the proposed lots be used as less productive rural residential or rural smallholding lots.
The Tribunal found that in the circumstances of this case, the proposed amalgamation and resubdivision of the land would satisfy the requirements for rural subdivision under the State and Shire of Plantagenet policies.
The Tribunal also concluded that the proposal would not establish an undesirable precedent for the general subdivision of rural holdings in this locality or for homestead lots to be used as a matter of course for the creation of rural small holding that reduced the productive capacity of Rural zoned land in conflict with policy objectives.
The Tribunal determined, in the particular circumstances, to allow the application for review and to grant conditional approval for the proposed amalgamation and subdivision of the site.

Introduction

These proceedings involved an application brought by Mr Charles Hicks and Mrs Mary Hick (applicants), pursuant to s 251(1) of the Planning and Development Act 2005 (WA) (PD Act), for review of the decision of the Western Australian Planning Commission (Commission or respondent) to refuse the proposed amalgamation, and then resubdivision, of Lot 150 and Lot 151 Chorkerup Road, Narrikup (site).
The site, originally Location 6601 of 177.9 hectares, has been the subject of previous subdivision applications. In 1997, the Commission refused Application 10446 by the then owner for lots of 5.45 hectares, 12.92 hectares, 5.388 hectares and 105.68 hectares. In 1998, the Commission refused Application 107506 for subdivision into 7.47 hectares, 40 hectares, 47.1 hectares and 43.4 hectares. On each occasion, the Commission refused the application because it considered that the proposal did not meet the objectives of the local town planning scheme or its policies on the subdivision of Rural zoned land. In 2001, the then owner applied to excise a 9.4 hectare 'homestead lot' with the house and sheds from Location 6601. The application said that the 168.5 hectare remainder was to be cultivated as a blue gum plantation. This subdivision was approved and the deposited plan for Lot 150 of 10.42 hectares and Lot 151 of 167.53 hectares was endorsed in March 2001.
The originally proposed uses for the two lots did not eventuate. It is understood this was because of the death of the owner. Both lots were bought by the applicants and have been worked as a single agricultural holding. In January 2008, the applicants applied to amalgamate Lot 150 and Lot 151, and to subdivide the site into Lot A, of 34.2 hectares at the northern end, and Lot B of 143.7 hectares, which would include the house and sheds. The Commission refused this application in May 2008. The owners applied for reconsideration of the decision and, in September 2008, the Commission reiterated its earlier refusal.
The current application, which is the same as the 2008 application, was lodged with the Commission in December 2009.

Site and locality

The site is 35 kilometres south of Mount Barker and approximately 7 kilometres west of Albany Highway. It is bounded by Chorkerup Road to the northeast, Creek Road to the west, Sleeman Creek Nature Reserve to the south and a freehold rural property, Location 6600, to the southwest. The site is an irregular shape. It might generally be described as a triangle, with the hypotenuse being the frontage to Chorkerup Road of about 3,300 metres at the northeast. At the apex of the triangle in the southwest corner, an area of 645 metres by 744 metres of Location 6600 'intrudes' into the site.
The site rises with undulations from a creek at the southeast corner to more elevated land at the northwest corner, at the corner of Chorkerup Road and Creek Road. The site is currently used for broadacre grazing of cattle and some sheep. In the immediate rural locality, the common land use is broadacre grazing, with some blue gum plantations.
Lot 150 of 10.4 hectares is at about the centre point of the Chorkerup Road frontage of the site. It has road frontage of 287.1 metres and it is generally about 500 metres deep. The existing house, occupied by the applicants, and sheds on Lot 150 are at the furthest extremity from the road frontage. The arable land of Lot 150 is not distinguishable from that of Lot 151.
Lot 151 of 167.5 hectares is mostly cleared and fenced pasture. The site was viewed by the Tribunal prior to the hearing, accompanied by the representatives of the parties, the applicants and the witnesses.

Planning framework

The site is zoned Rural under the Shire of Plantagenet Town Planning Scheme No 3 (TPS 3). TPS 3 provides no guidance on the subdivision of land zoned Rural.
On 9 March 2010, pursuant to cl 7.6 of TPS 3, the Shire of Plantaganet (Shire) adopted Town Planning Scheme Policy No 18 Planning Vision (Planning Vision). The Planning Vision was originally developed as a draft local planning strategy (draft LPS) for endorsement by the Commission. The Commission has delayed endorsing the draft LPS because it disagrees with the recommended minimum lot sizes for Rural zoned land. Clause 1.1 and cl 1.2 of the Planning Vision point out that the Commission will not approve the Planning Vision in its current form, and the resolution by the Shire to adopt the Planning Vision as a town planning scheme policy provided the following explanation:
As the modifications and finalisation of the LPS will take some time[,] it is important that the Council at least sets its strategic long-term planning direction.
Clause 2.3 of the Planning Vision outlines a 'rural vision' which includes:
…
•Preclude inappropriate subdivision and non rural development to protect rural and visual qualities;
•Consolidate Rural Residential and Rural Smallholdings in nodes on appropriately zoned land;
•Include provision for Rural Smallholdings on land in reasonable proximity to townsites;
…
The site is identified in the Planning Vision as 'General Agriculture' land use and is located within the 'P8 South KokonupNarrikup' planning unit. Clause 3.1.3.1 of the Planning Vision sets out the purpose of general agriculture land, which includes:
… provide for the sustainable use of rural land which primarily accommodates a range of rural pursuits compatible with the capability of the land and which retains the rural character and amenity of the locality.
Clause 3.1.3.2 of the Planning Vision establishes objectives for general agricultural land as follows:
The Council's objectives in managing and guiding land use, development and subdivision within General Agriculture will be to:
(i)encourage the protection of the rural infrastructure and land resource;
(ii)encourage the use of rural land for commercial agricultural production including grazing, cropping, agro forestry [sic], tree plantations, intensive agricultural production;
(iii)recommend support for subdivision where it provides for boundary adjustments, realignments and farm restructuring and new lot creation which promotes effective land management practices and environmental and landscape enhancement …
Clause 3.1.3.3 of the Planning Vision sets out policies for general agriculture land and states:
The Council's policies in controlling development and influencing subdivision within General Agriculture will be to:
…
(ii)confirm that rural residential and rural smallholdings subdivisions will not be supported unless and until the land is identified on the plans in this TPS Policy 18 and has been rezoned for that purpose …
Clause 8.4 of Appendix 6 of the Planning Vision entitled 'Planning Unit Objectives' provides the following:
Identify and protect agricultural areas of State/Regional/Local significance through the appropriate zoning of land and the application of subdivision and development controls to retain the area's agricultural potential.
…
Ensure planning provisions are in place to prevent the development of uses which are in conflict with and incompatible with the primary uses of the land for intensive and extensive agriculture …
The Commission's Statement of Planning Policy No 2.5 Agricultural and Rural Land Use Planning (SPP 2.5) applies to the planning of rural land in Western Australia. Part 4 of SPP 2.5 sets out the following four key objectives:
1.Protect agricultural land resources wherever possible by
a.discouraging land uses unrelated to agriculture from locating on agricultural land;
b.minimising the ad hoc fragmentation of rural land …
2.Plan and provide for rural settlement where it can
a.benefit and support existing communities[;] and
b.have access to appropriate community services and infrastructure.
3.Minimise the potential for land use conflict by
a.providing adequate separation distance between potential conflicting land uses;
…
c.identify areas that are suitable and capable for intensive agricultural pursuits as agricultural priority areas; and
d.avoid locating new rural settlements in areas that are likely to create conflict with established or proposed agricultural priority areas.
4.Carefully manage natural resources …
Clause 5.1 of SPP 2.5 sets out requirements for local government local planning strategies and policies. Clause 5.1(ii) provides:
Local planning policies may be prepared to assist a local government in making decisions under its town planning scheme. The local planning policies should be consistent with the provisions of this policy.
Clause 5.2(i) of SPP 2.5 provides that land not identified as of agricultural significance or as suitable for closer development should be zoned General Agriculture. At cl 5.3.1(i), SPP 2.5 provides that land identified in a strategy as being suitable for closer development should be zoned Rural Residential for residential use in a rural environment, or Rural Smallholdings for residential use in association with a rural pursuit. Clause 5.3.3(i)(a) of SPP 2.5 provides that:
In areas zoned 'Rural Smallholdings' the following town planning scheme provision should apply in addition to those listed in [cl] 5.3.1.(ii)
(a)Lot sizes ranging from 4 ha to 40 ha or more depending on local conditions;
…
Appendix 1 of SPP 2.5 'Glossary of Terms' includes the following:
Productive agricultural land Land currently in production or has the potential to be productive for agricultural purposes based on soil quality, water quality and availability, climatic factors and access to specific infrastructure or processing facilities.
Rural Means
•those areas of land where broadacre cropping and grazing are undertaken. These areas may also include large scale intensive production enterprises such as poultry farming, orchards, feedlots for livestock, dairying, viticulture and aquaculture; or …
Rural Smallholdings zone Land used for minor rural pursuits, hobby farm, conservation lots and alternative residential lifestyle purposes where part-time income from cottage industries, home occupation and use of the land for agriculture may be derived. This land use seeks to preserve and enhance landscape quality, environmental values and conservation attributes.
The Commission's Development Control Policy 3.4 Subdivision of Rural Land (DC 3.4), states at Pt 2 that the objective of DC 3.4 is to guide subdivision of rural land to achieve the four key objectives of SPP 2.5.
Clause 3.1 of DC 3.4 provides, as a general policy requirement:
It is WAPC policy that the subdivision of rural and agricultural land for closer settlement (ruralresidential and ruralsmallholdings) and more intensive agricultural uses should be properly planned through the preparation of regional and local planning strategies and provided for in local planning schemes prior to subdivision.
Clause 4.1 of DC 3.4 provides:
It is WAPC policy that, in the absence of the planned provision for closer settlement and more intensive agricultural uses, existing large rural lots be retained for broadacre and traditional forms of farming and that the fragmentation of rural land and loss of rural character through piecemeal, unplanned subdivision not be permitted.
The following forms of subdivision are not fragmentation, do not result in loss of rural character and may be permitted:
(a) To realign lot boundaries for farming purposes and/or for access to landlocked lots, with no increase in the number of lots.
The WAPC will exercise its judgement in applying criteria 4.24.9 when assessing the merits of an application for the subdivision of rural and agricultural land.
Clause 4.2 of DC 3.4 'Prevailing lot sizes' provides:
In broadacre farming areas large lots may be subdivided to create lots which are consistent with the size f lots used for farming in the locality and allow for continued broadacre farming. Neither lots created in the early days of settlement nor tied lots will be used in determining prevailing lot sizes in a locality or for creating a precedent for further subdivision.
…
Clause 4.5 of DC 3.4 'Boundary realignments' provides:
Lot boundaries which are poorly aligned with natural or constructed features and/or which result in encroachments may be corrected through minor boundary realignments.
Clause 4.6 of DC 3.4 'Farm rationalisation' provides:
Multiple lots in one ownership may be rationalised through boundary realignments to improve farm management and/or to provide access to landlocked lots provided that:
(a)the new lot pattern is consistent with the objectives of the policy;
(b)no additional lots are created;
(c)the new boundaries reflect good environmental and land management practice and are appropriate for the intended land uses;
(d)former road reserves and small remnant portions of lots are not lots for the purpose of boundary rationalisation.
…
Clause 4.9 of DC 3.4 'Homestead lots' states:
Homestead lots may be created to enable an existing house on a farm to continue to be occupied provided that:
(a)the land is in the Wheatbelt agricultural policy area … ;
(b)the population in the locality is declining or relatively static;
(c)the homestead lot has an area between 1 and 4 ha or up to 20 ha where it is desirable to respond to the landform or to include existing outbuildings or water sources;
(d)there is an adequate water supply for domestic, land management and fire management purposes;
(e)the homestead lot fronts a constructed public road;
(f)the homestead lot contains an existing residence; and
(g)a homestead lot has not been excised from the farm in the past.

The proposal

Proposed is the amalgamation of Lot 150 with the larger surrounding Lot 151 and the excision of a triangular shaped area at the northwestern end of the site to be Lot A. Lot A would be 34.2 hectares with a frontage of 626.7 metres to Chorkerup Road and a 975.05 metre frontage to Creek Road at the western side. The remainder of the site, Lot B, would be 143.7 hectares and would contain the house and sheds. The 810 metre boundary between Lot A and Lot B would be adjacent to a 30 metre wide revegetation strip and on the alignment of power lines across the site.

The refusal

The Commission refused the application for reasons which might be summarised as follows:
•The proposal conflicts with the objectives of SPP 2.5 and DC 3.4 because the proposed 34 hectare lot is considered a lot for rural living and will result in a loss of agricultural land.
•The proposal does not comply with the exceptions available under DC 3.4 because
it has not been demonstrated that existing lot boundaries are poorly aligned or that the boundary adjustment would be minor in nature; and
it has not been demonstrated that the boundary realignment will improve farm management practices or reflect good environmental and land management practice.
The Commission also considered that the subdivision would set an undesirable precedent of further fragmentation of other rural land in the locality.

Issues

From the submissions of the parties, the Tribunal has identified the following issues that arise to be determined in this matter:
1)whether the size and characteristics of proposed Lot A will result in it being used for productive agricultural or as a rural smallholding or rural residential lot;
2)whether the creation of Lot A will be inconsistent with the planning framework comprising SPP 2.5, DC 3.4 and the Planning Vision; and
3)whether the proposal will set an undesirable precedent for further subdivision of surrounding lots inconsistent with current zoning.

Whether the size and characteristics of proposed Lot A will result in it being used for productive agricultural or as a rural smallholding or rural residential lot

The applicants called as an agricultural expert Mr Phillip BarrettLennard. The respondent called Mr Allan Peggs. There was no dispute between these experts that the site was good quality farming land used for broadacre grazing of cattle and some sheep. The experts agreed that the proposed lot boundary between the two proposed lots would be in a rational location for farm management, because it would be along the alignment of electricity transmission lines across the site and adjacent to a 30 metre wide shelter belt that would provide a buffer.
The proposed Lot A would be 34.2 hectares. The evidence of the agricultural experts was that it would contain about 27 hectares of grazing land, about 5 hectares of which is 'parkland cleared', with the remainder remnant vegetation and regrowth. The experts agreed that a bore on Lot A would provide an adequate and sustainable water supply for domestic and fire management needs and for broadacre grazing of livestock.
The experts agreed that Lot A has the potential for intensive grazing. Trials in the locality have demonstrated that for soils similar to proposed Lot A, by adding perennial pasture to the existing annual pasture and investment in fencing and water infrastructure, existing stocking rates might be at least doubled. This would be an increase from a stocking rate of approximately nine dry sheep equivalents per hectare (dse/ha) to approximately 22 dse/ha. The potential productivity of Lot A would be marginally less than that of proposed Lot B because parkland clearing affects pasture growth.
The experts also agreed that proposed Lot A had potential for intensive horticulture. This, however, would require significant investment in harvesting surface water and groundwater extraction. Lot A would also be suitable for tree plantations for timber and wood chip production, but the experts said this was unlikely because of current difficulties in the plantation industry.
Both experts agreed that it would be unlikely a lot of the size of Lot A would be acquired by another landowner for the purposes of a build up lot. This was because of the high value per hectare relative to the potential return if just used for this purpose.
It was common ground that Lot A, with its current broadacre land use, would not be commercially viable on its own. It was also agreed that if Lot A was developed for intensive grazing, it might reach a 'break even' point as a viable agricultural lot. Mr Peggs' comment was that 'in essence [Lot A] is simply too small to be commercially viable in its own right'.
The two agricultural experts and the two planning experts called by the parties agreed that it is common for the owners of rural lots, including in this locality, to have, and rely on, off farm income. This would include even the larger lots in the district. This means that a farmer commonly gets income from other employment, which might include work on other farms and contracting, or, if a fulltime farmer, has a partner who works elsewhere and contributes the income from that employment to the farm as required.
Mr Jason Gordon, a planner called as a witness by the respondent, said any new lot should be commercially viable for a fulltime farmer. The Tribunal notes that the test is whether proposed Lot A would have the capacity for productive agriculture and that capacity would be lost as a resource as a result of subdivision: Ingram & Anor v Western Australian Planning Commission [2003] WASCA 77 at [43]. The agricultural experts agreed that Lot A would have potential as a productive agricultural lot. They further agreed that the incentive for a future owner to maximise that capacity would relate to factors including off farm income, local markets, skill, and time dedicated to farming.
The agricultural experts disagreed on whether the circumstances would result in Lot A being used to maximise productive agricultural capacity. Mr BarrettLennard considered an off farm income would provide an external source of capital to either maintain current levels of productivity or fund productivity enhancing projects on the lot. The opportunity to supply gourmet local produce, including to the Albany Farmers' Market, could enable a successful smallscale agricultural or horticultural enterprise to be established. Mr BarrettLennard was of the view that what was required for Lot A was not 'commercially viable' farming activity, but a return that would be part of the owner's income stream. In his opinion, Lot A would not therefore be lost as productive agricultural land. The land would only be lost to agriculture if a new owner allowed it to revert to bush, and he considered Lot A too large and expensive for this to be likely.
Mr Peggs considered the necessity for any owner to have off farm income would reduce the economic motive to maintain or enhance productivity on Lot A. If an owner's basic living requirements were met by off farm income, there would not be the economic imperative for the landowner to generate additional income from the property in order for those needs to be met. In his opinion, such an owner would view the lot as a rural lifestyle lot with the 'luxury' of deciding whether to farm.
Mr Peggs said many lifestyle landholders lacked the skills and the time to farm in a productive manner. Mr Peggs was of the opinion that, in respect of horticulture on Lot A, the significant investment in sheds, bores and reticulation that was necessary would require 'a lot of security' and this security would be greater than the value of the land. To justify the investment, a high value product would be required which might require seasonal workers and an identified market. His view was that the investment would be too great for the return and so the use of Lot A for horticulture would be unlikely. Mr Peggs' opinion was that the proposed subdivision would result in the loss of Lot A as productive agricultural land.
Both experts were of the view that if Lot 150, the homestead lot, were sold and a new owner used the lot for lifestyle purposes, which was likely, it would be lost to agricultural production.
The agricultural experts agreed that if subdivision were allowed, Lot B would have a small decrease in income and an increase in fixed costs per hectare, but generally, the productivity of Lot B would remain about the same. The experts also agreed that the sale of proposed Lot A would raise capital for the applicants, and the applicants might get a better return using the capital for some other purpose than the return they would get from using the area of Lot A for broadacre grazing as part of their farm.
The applicants called Mr Peter Duncan, a town planner who has 23 years' experience in the Great Southern Region, including 10 years as town planner at the Shire of Denmark and the last four years as Manager of Development Services for the Shire. His evidence was that in this district and further to the west were lots of similar size and attributes to proposed Lot A. Soils, water and a successful history of mixed farming and intensive agricultural pursuits resulted in lots of a minimum of about 40 hectares being farmed to realise their potential as productive agricultural holdings, especially for horticultural crops and intensive grazing.
The applicants also called Mr James Barrow, who has experience of farming in the Shire of Plantagenet and in the neighbouring Shire of Denmark. His experience was that lots in the district of the size of proposed Lot A with similar soils and water availability were used for productive agriculture, not just as hobby farms.
In considering this issue, the Tribunal has noted that the definition for 'productive agricultural land' in SPP 2.5 includes land that 'has potential to be used for agricultural purposes'. The Tribunal has also noted that in the Planning Vision, the preferred minimum lot size for general agricultural lots is 40 hectares, with a minimum of 30 hectares of productive land in the locality of the site.
In this matter, there is no dispute that the soil type and availability of water within Lot A are sufficient to make it productive. The question arises, however, whether Lot A is of sufficient area to cause it to have potential as a viable productive rural holding in its own right. The Tribunal accepts that this might include a contribution from off farm income, which the experts say is common for productive farms in the district. A further question that arises is whether the agricultural potential will be realised, given the investment in additional infrastructure required to increase productivity beyond the current low intensity grazing use which is sustainable only as part of the applicants' existing holding.
Mr Duncan was of the opinion that there were more attractive, desirable and suitable lifestyle blocks appropriately zoned in and around the existing settlements of Narrikup, Porongorup and Mount Barker. The applicants considered Lot A would be too large to be attractive to a buyer for a rural residential lot.
The Tribunal favours the submissions of the applicants' witnesses that proposed Lot A would be larger in size and value than a lot likely to be acquired by a person simply looking for a rural residential site. The Tribunal has formed the view that in the circumstances of this case, there is a likelihood that proposed Lot A will be used to achieve its potential as a productive agricultural holding rather than only be used as a rural residential lot or as a rural smallholding for hobby farming. The Tribunal further considers this potential would be enhanced if the minimum lot size requirements for general agricultural lots under the Planning Vision were achieved.

Whether the creation of Lot A will be inconsistent with the planning framework comprising SPP 2.5, DC 3.4 and the Planning Vision

The site is zoned Rural under TPS 3, but TPS 3 does not include provisions to guide the subdivision of Rural zoned land. Ms Baesjou, for the applicants, pointed out that the proposal was supported by the Shire, which has knowledge of local land uses and has adopted the Planning Vision as policy to guide land use, development and subdivision in its district.
The Planning Vision, adopted by the Shire as policy under TPS 3 when the draft LPS was not endorsed by the Commission, specifically refers to a minimum lot size of 40 hectares for subdivision of general agriculture land in particular locations. Clause 8.2 of Appendix 6 refers to lot sizes of 40 hectares west of Albany Highway in Planning Unit P8 South Kokonup Narrikup, where the site is located. The Planning Vision states that the locality is suitable for mixed farming, including intensive agriculture. Ms Baesjou said it is not intended that a rural smallholding settlement be established, and Lot A would be consistent with the objectives for general agriculture land under the Planning Vision.
The respondent's position was that, because there was not an endorsed local planning strategy, the basis for subdivision was to be found in the Commission's policies, and the proposed Lot A, at 34 hectares, would be consistent with the rural smallholding lot size of '4 ha to 40 ha' contemplated at cl 5.3.3(i)(a) of SPP 2.5. The respondent emphasised that SPP 2.5 has as an objective conserving productive agricultural land and, on the evidence of Mr Peggs, the proposed unplanned fragmentation of rural land to create a rural smallholding would, in all likelihood, remove agricultural land from production.
The respondent's submission was that proposed Lot A would be inconsistent with cl 3.1 of DC 3.4, because no provision has been made in an endorsed planning strategy or local planning scheme for the subdivision of agricultural land in this locality into rural residential and rural smallholding lots. The proposed subdivision would also not comply with cl 4.1 of DC 3.4, because it would be 'piecemeal, unplanned subdivision' which would not retain the rural character of broadacre and traditional forms of farming.
The position of the applicants, as discussed under issue 1 above, was that the proposal was not subdivision for a rural smallholding and that, on the evidence of Mr BarrettLennard, Lot A would be a general agricultural lot with potential for viable agricultural production. The proposal would not be ad hoc subdivision or de facto rezoning, because the lot size and potential for agricultural use was consistent with the policy objective in SPP 2.5 of conserving productive agricultural land.
In its consideration of issue 1 above, the Tribunal formed the view that proposed Lot A could be consistent with the definition of a productive agricultural holding, and particularly if increased in size to a minimum of 40 hectares. It follows then that in that regard, the proposal is not piecemeal, unplanned subdivision of rural land to rural residential or rural smallholding lots, and is consistent with SPP 2.5 and DC 3.4.
The applicants said that even though they considered Lot A could be allowed as a productive rural lot, the proposal also satisfied certain of the discretionary provisions to be considered when assessing the merits of rural subdivision. It was the respondent's position that the proposed subdivision did not satisfy any of what it termed 'exceptions' available under DC 3.4.
The relevant provisions of DC 3.4 referred to by the parties are set out in full above in the planning framework. Clause 4.1 of DC 3.4 sets out forms of subdivision that are not fragmentation and do not result in loss of rural character, and cl 4.2 to cl 4.9 provide instances where subdivision of rural land might be considered.
Mr Duncan said the subdivision would be consistent with cl 4.1(a) of DC 3.4. The boundaries were being realigned for farming purposes and no additional lots would be created. The proposal was therefore not ad hoc or fragmentation of farming land.
The respondent said the proposed subdivision did not satisfy this test. Proposed was not a boundary realignment, but an amalgamation of a 10 hectare homestead lot with an agricultural lot, and then a subdivision to create a 34 hectare rural smallholding lot. There was no increase in the number of lots, but examples where this form of boundary realignment had been allowed were associated with lots of about the same size to, for example, create more regular shaped lots or ensure water supply is on the same lot as cattle yards. Lot 150 was a homestead lot created for a purpose other than agriculture. The creation of Lot A would remove an area of agricultural land larger than Lot 150 from production, and so rural character would not be maintained.
The Tribunal would make the comment at this point that it is of the view that, in certain circumstances, there might be a case for a rural holding comprising a small nonproductive lot and a productive agricultural lot to be improved by resubdivision into two productive agricultural lots. The Tribunal's position, however, is as referred to in cl 4.2 of DC 3.4; that is, that amalgamation and resubdivision is not usually supported if the smaller lot is an historical remnant, such as a closed road. This is further the case if the smaller lot is without improvements and farmed as part of, and is indistinguishable from, the paddocks of the farm. This is certainly the case where both, or even the replacement lot that is larger than the original lot, is less productive than the original holding.
The site is in a location where it is unlikely a rural residential lot would have been approved if it was not to be a homestead lot. A question that arises is whether the planning of the locality would be better served if, for farming purposes, the two lots of which the site is comprised were changed into two agriculturally productive lots. Given the Tribunal's conclusion under issue 1 above, that Lot A is likely to be a productive agricultural lot and Lot 150 which it replaces is not, the Tribunal's view is that the proposal can be supported as consistent with cl 4.1(a) of DC 3.4.
At cl 4.2 of DC 3.4, in considering subdivision, consideration may be given to prevailing lot sizes in the locality. Relying on Mr BarrettLennard's evidence and his own long experience of land use in the district, Mr Duncan said the new Lot A would be consistent with the creation of agriculturally sustainable lots in this locality, and there were productive lots of similar size situated throughout the western part of the Shire's district. Mr Duncan said the policies of the Commission do not specifically refer to 'large' agricultural holdings. In his opinion, policies adopted for the whole State needed to be considered in light of local conditions. Lot size and potential land use relevant to the eastern part of the Shire and to the Wheatbelt were not relevant to landholdings in this locality.
The respondent was of the view that there are many other farming properties in the locality that are of similar size to the site, in particular the lot adjoining to the southwest and the lot immediately to the northwest. Proposed Lot A would not be consistent with the size of these farming lots and would not allow for continued broadacre farming as required by cl 4.2 of DC 3.4.
The Tribunal notes the evidence of Mr BarrettLennard and Mr Duncan, and that of Mr Barrow, and accepts that in this western part of the district, the proposal would be consistent with a pattern of similar sized productive agricultural lots.
The applicants also relied on cl 4.5 of DC 3.4, which provides for poorly aligned lot boundaries which result in encroachments being corrected through minor boundary realignments. Mr Duncan and Mr BarrettLennard said Lot 150 was poorly located because it encroaches into Lot 151 and, if sold, could result in land use conflicts between a new rural residential owner on Lot 150 and a farmer on Lot 151. The respondent's submission was that the boundary realignment was not minor, because the result would be a larger lot in a separate location. Lot 150 was not created as a rural lot, which is now found to have poorly aligned boundaries, but was established by the then owner as a homestead lot, which DC 3.4 provides for in rural locations such as this. The respondent said the applicants could not rely on cl 4.5 of DC 3.4.
Mr Duncan pointed out that when Lot 150 was established as a homestead lot, the relevant policy was the 1992 version of DC 3.4. At cl 4.2.3(vi), the 1992 version provided that an exception to the presumption against subdivision of rural land may apply where a homestead lot was 'to be excised from a farming property for residential purposes'. The additional qualifications set out for homestead lots in the current February 2008 version of DC 3.4 were not in the earlier version. Lot 150 subsequently became one of two lots in the current owner's rural holding. Lot 150 was not created to address population decline, as is now currently required and which is emphasised by the respondent. As highlighted by Mr Duncan, DC 3.4 does not provide for the time when the circumstances associated with the creation of a homestead lot no longer exist.
The Tribunal is not persuaded by the submissions on behalf of the applicants that a farmer would deliberately sell a small lot that would, in all likelihood, result in new rural residential neighbour with potential to cause land use conflicts. It is also not clear to the Tribunal that an active farmer would sell the lot with essential farm infrastructure simply to use funds released to replicate that infrastructure so that the farm can continue to be productive. There remains, however, the potential that, in the future, the lots might be sold separately and it would then become an encroachment into productive Lot 151.
The Tribunal has formed the view that, in this instance, the result of the proposal would be the replacement of a poorly located 10 hectare lot with low potential for productive agricultural use on its own and high potential to generate land use conflict with a larger and better located lot with high potential for productive agricultural use and low potential for future land use conflict. The Tribunal notes that, at cl 4.9(g) of DC 3.4, creation of a homestead lot is not supported where a homestead lot has previously been excised from the farm. In the submission of Mr Duncan and Mr BarrettLennard, if Lot 150 were sold, about 7.5 hectares of land currently used for productive agriculture would be lost, but if the proposal were allowed, it would result in two productive agricultural lots. The proposal would therefore be consistent with cl 4.5 of DC 3.4.

The respondent said the applicants could not rely on cl 4.6 of DC 3.4, which provides for rationalisation of a farm comprising multiple lots. This was because, even though no additional lots would be created, on the evidence of Mr Peggs, it was unlikely proposed Lot A would be developed for the intended land use of sustainable agriculture. The improvement in the farm management required by cl 4.6 of DC 3.4 would not result. The new lot pattern would include a lot that was not agriculturally sustainable and therefore would be inconsistent with the objectives of DC 3.4 and SPP 2.5.
The applicants submitted that the proposal was consistent with farm rationalisation as provided for at cl 4.6 of DC 3.4. This was because, with the proposed amalgamation of Lot 150 with Lot 151 and the creation of Lot A, no new lots would be created and, on the evidence of Mr BarrettLennard, good environmental and land use management practices would result, because Lot A would be capable of productive agriculture. The applicants said the subdivision would therefore also be consistent with the objective of SPP 2.5 of retaining land for agricultural production.
The Tribunal's findings from its consideration of the proposal, in the light of the relevant provisions of SPP 2.5, DC 3.4 and the Planning Vision, have led it to the conclusion that, in the circumstances of this proposal, the creation of Lot A would be consistent with the planning framework.

Whether the proposal will set an undesirable precedent for further subdivision of surrounding lots inconsistent with current zoning

The respondent referred to the Tribunal's decision in Nicholls and Western Australian Planning Commission [2005] WASAT 40 at [74]; (2005) 149 LGERA 117 at [74] at which the Tribunal adopted the following criteria, from Goldin & Anor and The Minister for Transport Administering the Ports Corporation and Waterways Management Act 1995 (2002) 121 LGERA 101, as the circumstances in which precedent is a relevant consideration in a planning assessment. These are:
(1)that the proposed development or subdivision is not in itself unobjectionable; and
(2)that there is more than a mere chance or possibility that there may be later undistinguishable applications.
It was the respondent's contention that the proposed subdivision was not, in itself, unobjectionable. It considered for the reasons outlined above, that the proposal was inconsistent with the planning objectives for rural subdivision found in SPP 2.5 and DC 3.4. This was particularly so in respect of a homestead lot being used as a basis for the creation of the proposed Lot A. This, it was said, would undermine the purpose of the creation of homestead lots, which was to arrest declining population and ensure that an existing homestead would continue to be occupied. There would be increased pressure for homestead lots to be used to create larger smallholdings and 'lifestyle lots' for retirees under the guise of boundary realignment and farm rationalisation. The proposal would be a precedent for the ad hoc creation of lots of this type in the district and should not be approved.
The respondent made reference to the other homestead lots within Planning Precinct 8 of the Planning Vision and said that there was more than a mere chance or possibility that there would be later undistinguishable applications similar to the current proposal.
The respondent was also concerned that a precedent would be set by determining that 34 hectares was a productive agricultural lot in this locality and allowing the subdivision of the site. This was because there were geographically proximate lots of a similar size and of similar soil and water availability. Other owners were likely to submit that they also should be allowed to excise 34 hectares, even if they do not have a small lot to amalgamate with the remainder of their holding. Approval of the proposed subdivision may create a precedent for the subdivision of similar sized lots, which could lead to the unplanned breakdown of agricultural lots into rural lifestyle or rural smallholding lots incompatible with the rural character and traditional agricultural activities of the area.
The applicants said that it was highly unlikely there may be later undistinguishable applications. Their submission was that the circumstances in this instance were unusual. This was because Lot 150 and Lot 151 were in the same ownership, and the proposal was not the unplanned breakdown of rural lots but a boundary adjustment that would result in two lots compatible with the rural character and traditional agricultural activities of the area.
The applicants rejected the submission that proposed Lot A was effectively a large homestead lot, referring to the evidence of Mr BarrettLennard that Lot A had potential for viable agricultural production. The applicants said that, in any case, if the proposal were to be viewed as a precedent, it would be regarded as positive or desirable. This was because a small, potentially intrusive and unproductive lot would be replaced with a productive agricultural lot, and this would ensure the retention and protection of agricultural land and sustainable agricultural production consistent with the objectives of SPP 2.5, DC 3.4 and the Planning Vision.
The Tribunal has formed the view that there are a number of factors that together can be considered to make the applicants' circumstances distinguishable. The proposal will result in the house, shed and yards, now on a 10.4 hectare lot, to be on the larger lot used for productive agriculture. The potential for the poorly located 10 hectare lot to be owned by another and give rise to land use conflicts will be removed. In this instance, two agricultural experts agreed that proposed Lot A would have potential as a productive agricultural lot. The Tribunal has formed the view on the evidence that Lot A is likely to be used as a productive agricultural lot rather than as a 'lifestyle' lot. No additional lots will be created. In addition, the proposal has the support of the Shire, and this support is based on the Planning Vision adopted as planning policy under TPS 3 to guide land use.
The Tribunal has concluded that, in this instance, any potential for the proposal to set a precedent is limited to particular circumstances and is therefore acceptable.

Conclusion

The evidence of the applicants' witnesses on the attributes of the site and land use in the western part of the Shire's district has led the Tribunal to conclude that proposed Lot A has the potential to be a productive agricultural holding. On balance, the Tribunal has favoured the evidence of the applicants' witnesses and has concluded that there is a likelihood that this potential for Lot A to be utilised as a productive agricultural lot will be realised.
The Tribunal has also formed the view that the creation of Lot A is supported by the planning framework. The proposal meets the measures for rural subdivision, at cl 4 of DC 3.4. Proposed Lot A would have potential as a productive agricultural lot and so, because no additional lots would be created, the rural character would be maintained. The evidence has satisfied the Tribunal that the proposal would be consistent with allowed boundary realignments and farm rationalisation.
The proposal would be consistent with the objectives of SPP 2.5 and DC 3.4 of maintaining productive rural holdings. In addition, the proposal is supported by the land use provisions of the Planning Vision adopted by the Shire as policy under its TPS 3.
Finally, the Tribunal concluded that, in this instance, the amalgamation of Lot 150 with Lot 151 and the subdivision to create Lot A would not establish an undesirable precedent for the general subdivision of rural holdings in this locality, or for homestead lots being used as a matter of course for the creation of rural smallholding that reduced the productive capacity of Rural zoned land in conflict with the objectives of SPP 2.5 and DC 3.4.
From the conclusions reached in the consideration of the issues raised in this matter, the Tribunal has decided to allow the application for review and grant conditional approval for the amalgamation of Lot 150 and Lot 151 and subdivision of the resultant lot into two lots generally as proposed.

Conditions

On the orders of the Tribunal, the respondent, without prejudice to its position, provided a list of conditions it would want imposed if the Tribunal were minded to allow the application. Condition 3 was concerned with underground power, and the respondent agreed to rewording suggested by the applicants to make the condition more clear.
In addition, the Tribunal considered that a fourth condition would be appropriate. This would require Lot A to be increased in size to a minimum of 40 hectares, which would require a relocation of the boundary between Lot A and Lot B. The Planning Vision refers, in Appendix 6, to lots of 40 hectares with a minimum agricultural area of 30 hectares for general agricultural land in the P8 South KokonupNarrikup planning unit. The proposed lot does not meet these standards. Mr Duncan said he did not consider the Shire would be concerned with a variation from these standards if the lot was agriculturally productive and not for rural smallholding use. The Tribunal considers too great a variation of about 14% below the minimum standard for a productive agricultural lot.
The proposed boundary is described by the applicants as 'rational', because it aligns with a buffer strip of planted vegetation. This is a matter of farm management and the Tribunal does not consider this prevents a realignment of the boundary. The Tribunal considers that the applicants, in consultation with the respondent and the Shire, could identify an appropriate adjustment to the boundary between the proposed lots so that Lot A is increased in area to satisfy the minimum lot size requirement of 40 hectares.

Orders

1.The application for review is allowed.
2.The refusal of the respondent set out in its letter dated 17 March 2010 is set aside and approval is granted for the proposed amalgamation of Lot 150 with Lot 151 and the subdivision of the resultant lot into two lots, consistent with the proposal, subject to compliance with the following conditions:
1)The boundary between proposed Lot A and proposed Lot B to be adjusted so that Lot A is not less than 40 hectares in area.
2)Notification in the form of a Section 70A Notification, pursuant to the Transfer of Land Act 1893 (as amended) is to be placed on the Certificate(s) of Title of the proposed lots advising that no reticulated water can be provided to the land by a licensed water supplier and, as a consequence, owners will be required to make their own arrangements to provide an adequate supply of potable water. (Local Government/Western Australian Planning Commission)
3)Suitable arrangements being made with the local government for the provision of vehicular crossover(s) to service the lots shown on the approved plan of subdivision. (Local Government)
4)Arrangements being made to the satisfaction of the Western Australian Planning Commission and the specification of Western Power for the provision of an underground connection servicing proposed Lot A, shown on the approved plan of subdivision. (Western Power)

I certify that this and the preceding [93] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR J JORDAN, MEMBER