Lewis v Petrie
[2022] VSC 673
•7 November 2022
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
VALUATION COMPENSATION AND PLANNING LIST
S ECI 2021 04161
| ESTHER LEWIS | Applicant |
| v | |
| DENNIS PETRIE AND KATE PETRIE | First Respondent |
| GLEN EIRA CITY COUNCIL | Second Respondent |
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JUDGE: | Gorton J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 14 October 2022 |
DATE OF JUDGMENT: | 7 November 2022 |
CASE MAY BE CITED AS: | Lewis v Petrie |
MEDIUM NEUTRAL CITATION: | [2022] VSC 673 |
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PLANNING LAW – Appeal pursuant to Victorian Civil and Administrative Tribunal Act 1998 s 148 – Definition of ‘restriction’ in the Subdivision Act 1988 - Whether an easement is a restriction as defined – Whether inhibitions in owners corporation rules are restrictions as defined - Where the owners corporation did not consent to the development – Whether the grant of a permit was futile - Whether the Tribunal considered the relevant planning scheme - Planning and Environment Act 1987 s 61(4) – Subdivision Act 1988 s 12(2).
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Not applicable | Mr G Ryan |
| For the First Respondent | Mr M Townsend | KCL Law |
| For the Second Respondent | No appearance | Marcus Lane Group |
TABLE OF CONTENTS
A. The two properties and the planning permit......................................................................... 1
B. The asserted ‘restrictions’ in more detail.................................................................................. 2
B.1The model rules..................................................................................................................... 2
B.2Section 12(2) of the Subdivision Act 1988............................................................................. 3
C. Section 61(4) of the Planning and Environment Act 1987 and related statutory definitions 4
D. Are the implied easements ‘restrictions’?.............................................................................. 5
D.1 The distinction between an easement and a ‘restriction’ in the Subdivision Act 1988.. 5
D.2The adoption, in 2000, of the definition from the Subdivision Act 1988 in the Planning and Environment Act 1987........................................................................................................... 8
D.3Conclusion in relation to the implied easements............................................................. 9
E. Do the rules of the owners corporation contain ‘registered restrictive covenants’?....... 9
F. Whether it was wrong in law to affirm the decision to grant a permit when the owners corporation had not provided consent................................................................................... 11
G. The finding that the proposed development was consistent with the planning scheme 13
H. Further remarks........................................................................................................................... 14
I. Disposition................................................................................................................................... 19
HIS HONOUR:
A. The two properties and the planning permit
Esther Lewis, the applicant, owns a house at 47 Fitzgibbon Crescent in Caulfield North. Dennis and Kate Petrie, jointly the first respondent, are her neighbours at 45 Fitzgibbon Crescent. The houses are semi-detached and share a party wall. Under a plan of strata subdivision, Ms Lewis’s house is lot 2, and the Petries’ house is lot 1. The lower boundary of the lots is one metre below the site and the upper boundary of the lots is ten metres above the site. An owners corporation owns the common property that surrounds the houses and the areas below and above the lots. Ms Lewis and the Petries each own 50% of the shares in the owners corporation. The ‘model rules’ apply to the owners corporation.[1]
[1]The ‘model rules’ are contained in schedule 2 of the Owners Corporation Regulations 2018 (Vic).
The Glen Eira City Council, the second respondent, granted the Petries planning permission to renovate 45 Fitzgibbon Crescent including by the addition of a second story at the rear.[2] The proposed addition will alter the external appearance of the Petries’ lot and will, among other things, affect Ms Lewis’s light. Section 61(4) of the Planning and Environment Act 1987 precludes the grant of a permit if it would authorise anything which would result in a breach of a ‘registered restrictive covenant’. Ms Lewis commenced an application at the Victorian Civil and Administrative Appeals Tribunal (the ‘Tribunal’) for a review of the grant of the permit. She contended that:
[2]The second respondent notified the Court that it did not intend to take an active role in the proceeding in accordance with the principles enunciated in R v Australian Broadcasting Tribunal; ex parte Hardiman (1980) 144 CLR 13.
(a) The proposed addition would be in breach of the model rules and certain implied easements she had under s 12(2) of the Subdivision Act 1988;
(b) The restrictions[3] contained in the model rules and the implied easements were ‘registered restrictive covenants’ as that term is to be understood; and accordingly
(c) The Council was precluded by s 61(4) of the Planning and Environment Act 1987 from granting the permit.
[3]For reasons that will appear, I am here using this word in the general, wide sense of anything that precludes unrestrained conduct.
The Tribunal gave two decisions. It first declared, after argument, that s 61(4) of the Planning and Environment Act 1987 did not apply to the model rules or to the implied easements.[4] It then, following a further hearing, affirmed the Council’s decision to grant the planning permit.[5]
[4]Lewis v Glen Eira City Council [2021] VCAT 457 (Member Whitney).
[5]Lewis v Glen Eira City Council [2021] VCAT 1172 (Member Cook).
Ms Lewis has applied to this Court pursuant to s 148 of the Victorian Civil and Administrative Tribunal Act 1998 for leave to appeal against the Tribunal’s decision. Any appeal is limited to an appeal on a question of law. The application for leave to appeal and any appeal, if leave were to be granted, were heard together.
Ms Lewis’s notice of appeal raises three questions of law. The first is whether the grant of the permit was unlawful because of the implied easements and the rules of the owners corporation, which question turns on the proper meaning of the phrase ‘registered restrictive covenant’. The second is whether the Tribunal erred in law by granting a permit in circumstances where the owners corporation did not consent (or by failing to impose the obtaining of consent from the owners corporation as a condition). The third is whether the Tribunal erred in law by finding that the proposed development was an acceptable planning outcome within the Glen Eira Planning Scheme (the ‘Planning Scheme’).
B. The asserted ‘restrictions’ in more detail
B.1 The model rules
On registration of the plan of strata subdivision in 1986, a body corporate, now deemed an owners corporation, was incorporated.[6] As stated above, the ‘model rules’ apply to that owners corporation. Rules 4.3(1) and (2) of the model rules, headed ‘damage to common property’, provide as follows:
(1) An owner or occupier of a lot must not … alter the common property without the written approval of the owners corporation.
(2) An owner or occupier of a lot must not … alter a structure that forms part of the common property without the written approval of the owners corporation.
[6]In 1986, bodies corporate were incorporated under s 14 of the Strata Titles Act 1967 (Vic) as repealed by Subdivision Act 1988 (Vic) s 44(1)(a). Under the Subdivision Act 1988 (Vic) a body corporate created under the Strata Titles Act 1967 (Vic) is a ‘strata … body corporate’ and a body corporate for the purposes of the Subdivision Act 1988 (Vic) as per sch 2 item 2(d). A body corporate is also an owners corporation under the Owners Corporation Act 2006 (Vic). In s 3 of that Act owners corporation is defined to include ‘a body corporate which is incorporated by registration of a … plan of strata subdivision’.
Rules 5.2(1) and (2), headed ‘External appearance of lot’, provide as follows:
(1) An owner or occupier of a lot must obtain the written approval of the owners corporation before making any changes to the external appearance of their lot.
(2) An owners corporation cannot unreasonably withhold approval, but may give approval subject to reasonable conditions to protect quiet enjoyment of other lot owners, structural integrity or the value of other lots and/or common property.
The proposed renovation would, at least, involve making changes to the external appearance of the Petries’ lot, and this would, in the absence of written approval from the body corporate, be contrary to r 5.2. Ms Lewis, as the holder of 50% of the shares in the body corporate, is able to prevent the body corporate from giving written approval, subject, of course, to the Petries being able to establish that the refusal to do so was unreasonable.
B.2 Section 12(2) of the Subdivision Act 1988
Section 12(2) of the Subdivision Act 1988 is lengthy but it is necessary to set out parts of it in full. It provides, under the heading ‘Plan must show easements and other rights’, the following:
(2) Subject to subsection (3), there are implied—
(a) over—
…
(iv)any land on a plan if the plan specifies that this subsection applies to the land; and
(b) for the benefit of each lot and any common property—
all easements and rights necessary to provide—
…
(f)full, free and uninterrupted access to and use of light for windows, doors or other openings;
…
if the easement or right is necessary for the reasonable use and enjoyment of the lot or the common property and is consistent with the reasonable use and enjoyment of the other lots and the common property.
(3)A plan may provide that some, all or none of the easements and rights referred to in subsection (2) are implied as a burden or benefit over all or any of the land on the plan.
…
(8)The easements specified on a plan or implied by subsection (2) are in addition to easements under section 98(a) of the Transfer of Land Act 1958.
Ms Lewis stated that, for the purposes of determining the issues in dispute, it is sufficient to focus on the ‘full, free and uninterrupted access to and use of light for the windows, doors or other openings’, as it was apparent that the proposed renovation would place at least part of her property in shadow for some of the day.[7]
C. Section 61(4) of the Planning and Environment Act 1987 and related statutory definitions
[7]It is not necessary to decide, for the purposes of resolving this appeal, whether the qualification applies; that is, whether the extent of the interference with her ‘full, free and uninterrupted access to and use of light’ is necessary for the reasonable use and enjoyment of her lot and is consistent with the reasonable use and enjoyment of the Petries’ lot.
Section 61(4) of the Planning and Environment Act 1987 provides as follows:
(4)If the grant of a permit would authorise anything which would result in a breach of a registered restrictive covenant, the responsible authority must refuse to grant the permit unless a permit has been issued, or a decision made to grant a permit, to allow the removal or variation of the covenant.[8]
[8]Emphasis added.
A ‘registered restrictive covenant’ is defined in s 3 of the Planning and Environment Act 1987 as follows:
registered restrictive covenant means a restriction within the meaning of the Subdivision Act 1988;
‘Restriction’ is, in turn, defined in s 3 of the Subdivision Act 1988 as follows:
restriction means a restrictive covenant or a restriction which can be registered, or recorded in the Register under the Transfer of Land Act 1958;
The use of the comma in this definition seems unhelpful; neither party could identify a purpose it served.
Both the terms in the model rules and the easements implied by s 12(2) of the Subdivision Act 1988 impose ‘restrictions’ as that word is often understood, because they impose a barrier to the owner doing what they might otherwise be free to do. The issue is whether these are ‘restrictions’ as that word is used in the legislation; more particularly, the question is whether the model rules of the owners corporation or s 12(2) of the Subdivision Act 1988 impose a ‘restrictive covenant or a restriction that can be registered, or recorded in the Register’, as that phrase is properly to be understood in its context.
D. Are the implied easements ‘restrictions’?
D.1 The distinction between an easement and a ‘restriction’ in the Subdivision Act 1988
As noted above, s 3 of the Subdivision Act 1988 defines ‘restriction’ to be ‘a restrictive covenant or a restriction which can be registered, or recorded in the Register’. The concept of a restrictive covenant is well understood. It is a promise (covenant) not to do something, the benefit and burden of which attach to the owners of the pieces of land affected by the promise. It sits easily within the concept of a restriction, because, at its heart, is the notion that someone is subject to an enforceable promise not to do something.
The concept of an easement is also well understood. It is a right for the benefit of the owner of one piece of land, the dominant tenement, over another piece of land, the servient tenement. It is usually positive, like a right of way, and is recognised as a proprietary right. Although it can be ‘negative’, or can be seen to impose restrictions, it generally only does so to the extent required to make the positive right effective. For example, a right of way restricts the owner of the servient tenement, because that owner cannot interfere with the reasonable use of that right of way. But it is not a concept that immediately, or easily, sits within the concept of a ‘restriction’.
More significantly, though, the Subdivision Act 1988 uses the word ‘easement’ and the word ‘restriction’, and often the phrase ‘easement or restriction’ in a manner that evinces an intention that they be treated as separate concepts. As examples:
(a) Section 1(a) states that the ‘purposes’ of the Subdivision Act 1988 are to set out the procedure for the subdivision of land and ‘for the creation, variation or removal of easements or restrictions’;
(b) Section 3(1) defines a ‘plan’ as meaning, among other things, a plan of ‘creation, variation or removal of an easement or restriction’;
(c) Section 3(3) states that the ‘creation, variation or removal of an easement or restriction’ must be taken to be authorised by a permit if the permit provides for that creation, variation or removal;
(d) Section 3(4) states that if a planning scheme or permit ‘regulates or authorises the variation of an easement or restriction’, then that scheme or permit must be taken to include an authorisation to remove the easement or restriction;
(e) Section 4(1) provides that the Subdivision Act 1988 applies to ‘the creation, variation or removal of any easement or restriction’;
(f) Section 4(4A) provides that the Subdivision Act 1988 does not apply to ‘an encumbrance unless the encumbrance constitutes an easement or a restriction’;
(g) Section 6(1) sets out when a Council must certify a plan of subdivision. Section 6(1)(j) set out some requirements when the plan ‘removes or varies a restriction’, and s 6(1)(k) set outs some requirements when a plan removes or varies an easement;
(h) Section 12, headed ‘Plan must show easements and other rights’, requires a plan of subdivision to specify existing and proposed easements and to specify their purpose and the land to be benefited. As noted above, s 12(2) imposes a set of implied easements;
(i) Section 32 allows the members of a body corporate by unanimous resolution to ‘create, vary or remove any easement or restriction’; and
(j) Section 34B deals with disputes in relation to easements, and does not refer to ‘restrictions’.
If an easement were a ‘restriction’, then the repeated use of the word ‘easement’ in the phrase ‘easement or restriction’ would be redundant. The fact that the legislation uses the word ‘easement’, and uses it in a way that indicates that it is a concept separate from the concept of a ‘restriction’, strongly indicates that the legislature did not intend that an easement fall within the phrase ‘restrictive covenant or a restriction that can be registered, or recorded in the Register’ used in the definition of ‘restriction’ in s 3(1) of the Subdivision Act 1988. If the legislature had intended to include an easement, or the restrictions that are implicitly imposed on a servient tenement by the existence of an easement, within the definition then it could have easily have used the word ‘easement’ as it has elsewhere.
It is necessary to consider, however, what was intended by the inclusion of the words ‘or a restriction’ in the definition. The words must be given some content. But they do have other work to do. It is apparent from, at least, s 3(3) of the Subdivision Act 1988 that that Act anticipates that a planning scheme may, ‘by condition or otherwise’, require, direct or provide for the creation of a ‘restriction’, and that a Council may require a plan to create a ‘restriction’. These provisions allow a planning scheme, and permits given under it, to impose restrictions on the use of land. Those restrictions are not ‘restrictive covenants’, as they are not based on an initial, private covenant between landowners that has come to run with the land. But they may have a similar, restrictive effect. This gives a sensible explanation for the inclusion of the words ‘or a restriction’ in the definition. If the definition were limited to ‘a restrictive covenant’, and was not extended to a ‘restrictive covenant or a restriction’, then those types of restrictions would not be captured.
For completeness, I note that there is nothing in the second reading speech when the Subdivision Bill 1987 was introduced or its explanatory memorandum that indicates any intention to include easements within the definition of a restriction.[9]
D.2 The adoption, in 2000, of the definition from the Subdivision Act 1988 in the Planning and Environment Act 1987
[9]Victoria, Parliamentary Debates, Legislative Assembly, 13 October 1987, 1438 (Frank Wilkes, Minister for Housing).
Both s 61(4) and the definition of ‘registered restrictive covenant’ were introduced into the Planning and Environment Act 1987 by ss 4 and 9 of the Planning and Environment (Restrictive Covenants) Act 2000. The Planning and Environment (Restrictive Covenants) Bill 2000 as initially introduced on 1 June 2000 did not adopt the definition of ‘restriction’ in the Subdivision Act 1988, but provided for ‘registered restrictive covenant’ to mean ‘a restrictive covenant … registered or recorded in the Register…’. In the second reading speech, it was said:
In 1993 the Kennett government introduced amendments to the legislation that made it very difficult to remove or vary a covenant by grant of a planning permit. Most applicants then opted to apply for a permit to use or develop land, before subsequently acting to remove or vary the covenant.
This caused a variety of problems ….
This bill implements a simple principle to end these problems – that a permit to use or develop land must not be granted if the permit would result in the breach of a covenant. It may only be granted if authority to remove or vary the covenant is given either before or at the same time as the grant of the permit.
There are now three choices for applicants:
1. obtain a court order under the Property Law Act 1958 to remove or vary a covenant before applying for the permit;
2. concurrently apply for a permit to remove or vary the covenant and a permit to use or develop the land; or
3. as a planning authority to prepare an amendment to a planning scheme to authorise removal or variation of the covenant and concurrently consider an application to use or develop the land.[10]
[10]Victoria, Parliamentary Debates, Legislative Assembly, 1 June 2000, 2160 (John Thwaites, Minister for Planning).
By the time the Bill came on for further debate on 5 September 2000, the definition had been amended to the form in which it was enacted. The parliamentary debates do not explain why the definition was altered other than to say it was ‘the result of a recommendation of the Montebello report.’[11] The ‘Montebello report’ is the Report to the Minister for Planning on the Submissions to the Planning and Environment (Restrictive Covenants) Bill 2000. It explained its recommended change by saying:
Under the Subdivision Act 1988, it is possible to create obligations on lots in a plan of subdivision by creating a restriction on the plan of subdivision. The restriction is usually imposed by the developer … A restriction is different to a restrictive covenant in form because its basis is found within the Subdivision Act 1988. While a covenant is created when the land is sold, a restriction on a plan is created at the time the land is subdivided. However, both instruments have a similar effect.[12]
[11]Victoria, Parliamentary Debates, Legislative Assembly, 5 September 2000, 516 (John Thwaites, Minister for Planning).
[12]Terry Montebello, Report to the Minister for Planning on the Submissions to the Planning and Environment (Restrictive Covenants) Bill 2000 (Report, 17 August 2000) 13.
There is nothing in the second reading speech or debates to suggest that the changes introduced by the Planning and Environment (Restrictive Covenants) Bill 2000 were intended to apply to easements.
D.3 Conclusion in relation to the implied easements
In these circumstances, I agree with the Tribunal[13] that when the legislature used the phrase ‘restrictive covenant or a restriction that can be registered, or recorded in the Register’ in the Subdivision Act 1988, it did not intend to include an easement or, more particularly for the purpose of this case, the easements implied by s 12(2) of the Subdivision Act 1988. This was the case both in 1988 when the Subdivision Act 1988 was enacted, and in 2000 when the Planning and Environment Act 1987 was amended.
[13][2021] VCAT 457, [70]. See also Focus Vision Pty Ltd v Nillumbik Shire Council [2003] VCAT 1393, [35] (Macnamara DP and Gould SM).
I note that this conclusion is consistent with Hickey v Port Phillip City Council,[14] Focused Vision Pty Ltd v Nillumbik Shire Council,[15] Gray v Colac Otway Shire Council[16] and Richards v Hobsons Bay City Council.[17]
E. Do the rules of the owners corporation contain ‘registered restrictive covenants’?
[14][2000] VCAT 1919, [5].
[15][2003] VCAT 1393, [33]-[35].
[16][2005] VCAT 2266, [28]-[37].
[17][2013] VCAT 527, [56].
The rules of the owners corporations set out what lot owners can and cannot do. I accept Ms Lewis’s argument that the rule that prevents lot owners from changing the appearance of their lots is a restriction as that word is commonly understood. In that way, it operates in a way that is similar to a restrictive covenant. Again, however, the issue is not whether the rules of an owners corporation can impose a restriction, but whether such a restriction falls within the statutory definition — ‘a restrictive covenant or a restriction which can be registered, or recorded in the Register under the Transfer of Land Act 1958’ — when that phrase is read in context.
Owners corporations are subject to the Owners Corporations Act 2006. Part 10 of that Act deals with dispute resolution. It allows a lot owner to complain to the owners corporation about an alleged breach by another lot owner.[18] The owners corporation must then decide whether or not to take action in respect of the alleged breach or to apply to the Tribunal for an order requiring a person to rectify the alleged breach.[19] The Owners Corporations Act 2006 gives the Tribunal jurisdiction to hear and determine ‘a dispute or other matter’ arising under the Owners Corporations Act 2006 or the rules of an owners corporation[20] on the application of the owners corporation or an individual lot owner.[21] The Tribunal can then make an order requiring a party to do or refrain from doing something.[22] In this way, the rules of an owners corporation are enforceable. But they do not take the form of a promise, or covenant, made by one party in favour of another, which is at the heart of a restrictive covenant. Similarly, they are under the control of the lot owners, who may, within limits, by special resolution, set or amend their own rules including as to proposed works that alter the external appearances of a lot.[23] In this way they differ from restrictions that are imposed by statute or by a planning scheme on a lot or development.
[18]Owners Corporation Act 2006 (Vic) s 152.
[19]Ibid s 153(2).
[20]Ibid s 162.
[21]Ibid s 163.
[22]Ibid s 165.
[23]Ibid s 138.
As the matters set out in Part D above demonstrate, there is nothing in the legislation or extrinsic materials that indicates an intention to extend the reach of the definition of ‘registered restrictive covenant’ and s 61(4) of the Planning and Environment Act 1987 to the rules of an owners corporation.
Mr Lewis also argued, in substance, that the scope of the definition was controlled by the last component, that is, that it applied to any restriction so long as it ‘can be registered, or recorded in the Register’. The intention, it was submitted, was to cover any restriction that met that additional test. I do not construe the definition that way. If that were the controlling concept, then there would be no need to include the words ‘restrictive covenant’ at all, as it is well known that restrictive covenants can be recorded on the register. The argument would be stronger if the comma were moved to after the word covenant, so that it read: ‘a restrictive covenant, or a restriction which can be registered or recorded in the Register under the Transfer of Land Act 1958’. But it is not written that way. Instead, for the reasons expanded on above, in my view the definition was intended to capture restrictive covenants and restrictions that are akin to restrictive covenants, like the conditions imposed by planning schemes, rather than to capture any inhibition of any type so long as it is able to be registered or recorded on the register.
For this reason, the Tribunal was also correct to conclude that the restrictions placed on lot owners by the rules of the owners corporation are not ‘registered restrictive covenants’ for the purposes of the Planning and Environment Act 1987.
It is not necessary for me to decide whether, if, contrary to my view, the rules of the owners corporation were ‘restrictions’ as that word is used in the definition, the ability to identify the rules of the owners corporation from the Register is sufficient to conclude that they ‘can be registered, or recorded in the Register …’.
F. Whether it was wrong in law to affirm the decision to grant a permit when the owners corporation had not provided consent
A series of cases—Port Phillip City Council v Hickey,[24] O’Connell v Stonnington City Council,[25] Dove v Yarra Ranges Shire Council,[26] Fenton v Mornington Peninsula Shire Council,[27] Hamilton v Boroondara City Council[28] and Munro v Boroondara City Council[29]— have considered whether an application for a permit should be dismissed as ‘futile’ where the proposed build could not proceed without the consent of the owners corporation and the owners corporation was refusing to provide its consent. These cases all accepted that the owners corporation was able to prevent the development from proceeding notwithstanding the grant of a permit. But, for the most part, the applications for a permit were not dismissed on that basis for the reason that the owners corporation might change its mind at some time in the future.
[24][2001] VSC 129.
[25][2009] VCAT 572.
[26][2012] VCAT 760.
[27][2012] VCAT 836.
[28][2014] VCAT 1493.
[29][2015] VCAT 200.
I accept that the Council, or the Tribunal on review, is entitled decline to grant a permit if satisfied that there is no utility in granting one, and this may be the case if the consent of an owners corporation is required and it is clear that the owners corporation will never provide that consent. This might arise particularly in circumstances where the permit sought was for work including work on common property. However, whether or not to refuse to grant a permit on this basis involves a value judgment. In this case, the Tribunal turned its mind to this issue, and concluded:
In the current circumstances as a whole, I find that the grant of a planning permit is far from futile.[30]
[30][2021] VCAT 1172, [96].
It would be an unusual case where a Tribunal’s failure to set aside the Council’s decision to grant a permit on this basis would amount to an error of law. It would only be an error of law if no Tribunal member, acting reasonably, could do otherwise. This is not the case here. Rule 5.2, which deals with the external appearance of lots, provides that an owners corporation may not unreasonably withhold consent. It has not been determined whether or not the owners corporation’s withholding of consent in this case is reasonable. Rule 4.3 is headed ‘Damage to common property’, and prevents an owner from damaging or altering the common property without written approval of the owners corporation. The Tribunal was not obliged to be satisfied, to the extent required to establish that the grant of a permit was futile, that the work would damage or alter the common property, or that the owners corporation might not change its mind. Accordingly, no error of law on its part has been established.
G. The finding that the proposed development was consistent with the planning scheme
Clause 54.04 of the Planning Scheme is headed ‘Amenity Impacts’. Clause 54.04-02 deals with boundary walls and has the following stated objective:
To ensure that the location, length and height of a wall on a boundary respects the existing or preferred neighbourhood character and limits the impact on the amenity of existing dwellings.
Ms Lewis contended that the Tribunal, having found that the Standard in clause 52.04-2 of the Planning Scheme was not met, erred in its conclusion that the objective of that Scheme was nonetheless met. Ms Lewis’s concerns were that the proposed development might further damage the dividing wall, could impact footings, interfere with her roof structure, and overshadow and prevent her from installing solar panels. She provided the Tribunal with evidence from a structural engineer that related to those concerns.
Again, however, it is necessary to recall that Ms Lewis may only appeal to this Court on a question of law. In this case, the Tribunal considered Ms Lewis’s concerns, but was not persuaded by them. The Tribunal concluded that ‘the proposal overall would result in an acceptable outcome that meets the relevant objective – to respect character and limit impacts on amenity’[31] and that the proposed development ‘would not cause unreasonable detriment to the amenity of any property, including [Ms Lewis’s].’[32] In reaching this conclusion, the Tribunal, under the heading ‘Would the Impacts on Neighbouring Land be Acceptable’, considered:
[31]Ibid [34].
[32]Ibid [104].
(a) The extent of any overlooking;
(b) Mr Lewis’s wish to retain light to her roof both due to translucent tiles she had installed and her wish to install solar panels;
(c) The extent of any overshadowing; and
(d) The possibility of there being increased noise due to a staircase being constructed adjacent to the common wall.
The Tribunal had regard to the effect that the proposal would have on Ms Lewis’s amenity. The Tribunal was not satisfied that the transparent tiles on Ms Lewis’s roof would be ‘unduly compromised by the proposal’, and found that the overshadowing was acceptable and would not prevent the installation of solar panels.[33] It noted that the Petries were retaining the residential use of their property in accordance with its zoning, that if the staircase to be built alongside the common wall generated unacceptable noise or vibration then ‘the conventional law of nuisance would most likely apply’,[34] and that ‘appropriate construction detail and materials would otherwise ordinarily be considered at the building permit stage, with particular specifications applying to common walls.’[35]
[33]Ibid [47]-[53].
[34]Ibid [55].
[35]Ibid [57].
The Tribunal, under the heading ‘Other matters’, considered Ms Lewis’s expert evidence in relation to potential noise, vibration, support and waterproofing issues that might arise, and observed that these are ‘matters that could be dealt with via ordinary processes following the grant of a planning permit’.
For these reasons, I consider that the Tribunal engaged in the evaluative process required of it, and reached a conclusion that was open to it. Accordingly, I do not accept that it erred in law in reaching the conclusion it did.
H. Further remarks
For the above reasons, the relevant grounds of appeal are not made out.
Another issue arose, however, in the course of the proceeding that I should refer to. If, as I have found, the restrictions in the owners corporations rules and the implied easements are not ‘registered restrictive covenants’, does the grant of a planning permit mean that the Petries may now renovate without having first to overcome any restrictions in the model rules or the implied easements?
The law and legislation in this area is complex.[36] The basic proposition is that the grant of a planning permit removes the legal restriction that work cannot be done without a permit, but does not ordinarily override other legal rights that may be relied on to prevent the development from proceeding. This is because there is a distinction between planning issues, and the issues that arise from the private legal relationships between property owners. In Boroondara City Council v Sixty Fifth Eternity Pty Ltd, Emerton J said:
A planning permit is permissive, but in a limited sense. It entitles the permit applicant to do certain things, but subject to any conditions in the permit and any other restrictions imposed by law on the use or development of the land. The grant of a planning permit will overcome a particular restriction on the use or development of the land, namely the requirement to obtain a planning permit under the Act, but it will leave other restrictions untouched. As a result, it is not unusual for a planning permit to authorise a use or development that cannot take place until some other legal barrier has been removed, for example, by the grant of a gaming licence or an approval under environment protection legislation. This is a function of the layering of controls over land use and development, including in the Act itself.[37]
[36]See, eg, the Victorian Law Reform Commission, Easements and Covenants, Report No 22 (2010) 102.
[37][2012] VSC 298, [47].
Further, in Richards v Hobsons Bay City Council,[38] where a planning permit would allow building over an easement, the Tribunal said:
[38][2013] VCAT 527.
57. Accordingly, it seems to me, that it is still open to obtain a planning permit even though other permissions, licences or arrangements would need to be made in relation to other obstructions to the project. Obtaining a planning permit does not excuse the need to obtain such other permissions or the removal of other obstructions required to allow the proposal to proceed legally. It would [be] necessary to remove all legal impediments. It is just that you do not have to do them in any particular order, save for s 61(4) PE Act.
58. That applies whether the other permission, licence or approval is something that must be obtained from a public authority or whether it takes the form of adjusting a private right, like the right to an easement.
59. It is not the function of this Tribunal to enforce private real property rights or to make declarations in relation to them, at least not unless such a question has to be determined in the course of making a decision within the jurisdiction of the Tribunal. Other than that, such rights must be asserted and defended in the courts. Various actions such as trespass or declarations are no doubt available.
This is consistent with the way the Tribunal approached the issues in this case. In its reasons for decision, the Tribunal:
(a) First considered whether the proposal was ‘consistent with the relevant planning policy’. It concluded that it was;[39]
(b) Then considered whether the proposal would result in ‘an acceptable built form response’, including by evaluating the proposal against the standards and objectives of the ‘ResCode’. It concluded that ‘the proposal overall would result in an acceptable outcome that meets the relevant objective — to respect character and limit impacts on amenity’;[40] and
(c) Then considered whether the ‘impacts on neighbouring land’ would be acceptable. It found, by clear implication, that they would be.[41]
[39][2021] VCAT 1172, [9]-[24].
[40]Ibid [25]-[40].
[41]Ibid [41]-[57].
In forming the above views, the Tribunal had regard to conventional planning considerations including the appearance and scale of the proposed build, the extent to which it would overlook its neighbours, and the extent to which it would shade its neighbours. It is apparent that, having regard to those considerations, it considered the proposal to be ‘a suitable response to state and local planning policy’.[42] It was on that basis that it affirmed the decision to grant a planning permit.
[42]Ibid [102].
The Tribunal also, however, considered the implications from the restrictions contained in the model rules. Under the heading ‘Relationship between planning permission and owners corporation entitlements’, the Tribunal made it clear that it had decided to affirm the decision to grant the planning permit without adjudicating on Ms Lewis’s contention that the proposed build would be contrary to provisions of the Owners Corporations Act 2006 and the model rules. The Tribunal then stated the following:
[73]I accept that owners corporation legislation law including the Model Rules may continue to require certain permission/s to be obtained before works approved under this planning permit may lawfully be carried out. For example, it is possible that consent may be required for the external alteration of the building or for works on common property (if required). This may also depend in part on the reasoning of the Supreme Court in Elwick9 v Freeman.
[74]However, even if such consent was required, such consent could still be sought from the other lot owner.
…
[79] In Richards v Hobsons Bay CC the Tribunal observed:
Accordingly, it seems to me, that it is still open to obtain a planning permit even though other permissions, licenses or arrangements would need to be made in relation to other obstructions to the project. Obtaining a planning permit does not excuse the need to obtain such other permissions or the removal of other obstructions required to allow the proposal to proceed legally. It would necessary [sic] to remove all legal impediments. It is just that you do not have to do them in any particular order, save for s 61(4) PE Act.
….
…
[82]In short, while potential consent may be required from the owners corporation as a prerequisite for the practical implementation of the words approved under a planning permit, it is not a prerequisite for the grant of a planning permit for the works in this instance.[43]
[43]Ibid (emphasis in original) (citations omitted).
Accordingly, the Tribunal, in deciding whether or not to affirm the decision to grant a permit, applied what might be thought of as the usual planning considerations, and explicitly noted that, even with the permit, the Petries may not be able to carry out the renovation. The Tribunal did not evaluate whether or not the restrictions relied on by Ms Lewis that were beyond the usual planning considerations would be effective to prevent the build proceeding, notwithstanding the planning permit.
In those circumstances, it would be surprising if the grant of the permit had the effect of denying to Ms Lewis whatever arguments she might have (outside the restrictions imposed by the various planning schemes) to prevent the build. Indeed, the law seems tolerably clear that, absent some planning permit that purports to alter an established right and that has some legal justification for doing so, the mere grant of a planning permit will not preclude a neighbour from relying on whatever rights outside the planning regime he or she might have.
A difficulty arises, however, because of s 140 of the Owners Corporations Act 2006. That section is relevantly as follows:
140 Rules to be of no effect if inconsistent with law
A rule of an owners corporation is of no effect if it –
…
(b) is inconsistent with or limits a right … under –
…
(v) any other Act or regulation.
In Elwick 9 Pty Ltd v Freeman,[44] it was held that a gym owner with a permit that allowed it to open the gym at 6:00am was able to do so notwithstanding a rule of the owners corporation that prevented undue noise and vibration prior to 8:00am. The Court concluded in that case that:
…a use permitted by a planning permit creates a substantive right to use the land in the manner specified (subject to the conditions). This cannot be displaced by an inconsistent rule of an owners corporation…[45]
[44][2018] VSC 234.
[45]Ibid [112].
In so holding, the Court was influenced by language used in Simpson v Bass Coast Shire Council,[46] and other cases, where the grantee of a permit was described as having a ‘right’ to develop the land. In Simpson v Bass Coast Shire Council, the issue was whether a change to a planning scheme affected a planning permit that had already been granted. In that context, the Tribunal analysed the question in terms of whether the owner of the permit had ‘an accrued right’, which is language apposite to a consideration of whether or not a change has retrospective effect.
[46][2007] VCAT 165.
The correctness of this approach, and whether it was applicable to the circumstances under consideration in this case, was behind Ms Lewis’s concerns, but was not fully argued before me. It is not necessary for me to express a view on it, save for my observation that it would be somewhat surprising if restrictions in the rules of the owners corporation were unable to be enforced following a decision of a responsible authority to grant a permit, in circumstances where the responsible authority did not consider the existence of the restrictions in rules of the owners corporation when deciding whether to grant the permit.
I. Disposition
For the above reasons, I will grant leave to appeal but the appeal should be dismissed.
I will hear the parties on the question of costs.
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2
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