Maurice Forbes and Ors (according to the attached schedule) v Michael Vukadinovic and Ors (according to the attached schedule)

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2017 0022

MAURICE FORBES & ORS (according to the attached schedule)	Applicants
v
MICHAEL VUKADINOVIC & ORS (according to the attached schedule)	Respondents

---

JUDGES:	TATE and NIALL JJA and EMERTON AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	30 January 2018
DATE OF JUDGMENT:	5 June 2018
MEDIUM NEUTRAL CITATION:	[2018] VSCA 138
JUDGMENT APPEALED FROM:	[2017] VSC 20 (Garde J)

---

PLANNING AND ENVIRONMENT – Application for leave to appeal on questions of law from a decision of the Trial Division upon an appeal from the Victorian Civil and Administrative Tribunal – Application for planning permits to construct three broiler farms classified as ‘Class B’ by the permit applicant – Victorian Code for Broiler Farms 2009 (‘Code’) specified separation distances from sensitive uses – Classification depended on compliance with separation distances – Where sensitive uses constructed on neighbouring land following lodgement of permit applications for Class B broiler farms – Whether new sensitive uses were to be taken into account in determining broiler farm classification – Whether the Code required a departure from the usual practice that permit applications be determined on the basis of the facts in existence at the time of the permit decision – Proper construction of the Code – Planning and Environment Act 1987 ss 5, 60, 77, 84B, 85 – Victorian Civil and Administrative Tribunal Act 1998 ss 98, 127 – Leave to appeal granted in part and appeal allowed.

WORDS AND PHRASES – ‘property’.

---

APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr S R Morris QC with Mr I G Munt	Harwood Andrews
For the First Respondent	Mr J H Gobbo QC with Mr G H Peake	Sackville Wilks

TATE JA:

I have had the considerable benefit of reading the judgment of Emerton AJA, in draft form. I agree, for the reasons her Honour gives, that leave to appeal should be granted on proposed grounds 1 and 3, refused with respect to proposed ground 4, and the appeal allowed. In particular, with respect to ground 1, I agree that the Code is premised upon there being a single timeframe for classification and merits assessment of an application for a planning permit for the use of land as a broiler farm rather than a disjunction between classification and the rest of the measures in the Code. The Code requires the classification and overall assessment of a proposed broiler farm to be undertaken by reference to the facts and circumstances existing at the date that the responsible authority (or, relevantly, the Tribunal on review) makes its assessment of compliance with the Code and the relevant planning scheme.

The orders of the Tribunal concerning Farms 1 and 2 should be set aside and the proceeding remitted to the Tribunal in respect of the permit applications for Farms 1 and 2 to be determined according to law. In the remitted proceeding it will remain open for the first respondent to pursue the question, if he wishes to do so, that the houses on the Forbes and Smith land are not sensitive uses or involve a ‘sham’ in that they were constructed for the purpose of preventing the approval of the first respondent’s proposed broiler farms.

NIALL JA:

I have had the very considerable advantage of reading in draft the reasons for judgment of Emerton AJA. I agree that the orders proposed by her Honour should be made for the reasons that her Honour gives.

EMERTON AJA:

Introduction

The first respondent, Mr Vukadinovic, proposes to develop three broiler

farms, each accommodating up to 400,000 birds, on land at Baringhup West in the Shire of Mount Alexander. The land in question is made up of a number of contiguous lots totalling approximately 450 hectares. It was previously used for cropping and lamb farming. The surrounding properties are similar large farm holdings.

On 5 December 2013, the first respondent made three applications to the second respondent, Mount Alexander Shire Council (‘Council’), for permission under the Planning and Environment Act 1987 (Vic) (‘PE Act’) and the Mount Alexander Planning Scheme (‘Scheme’) to use and develop the land for the purpose of the broiler farms.

The land is in a Farming Zone. Pursuant to cl 35.07 of the Scheme, a permit is required for the use of land as a broiler farm and it is subject to the condition that the development meet the requirements of cl 52.31. Clause 52.31 requires compliance with the Victorian Code for Broiler Farms 2009 (‘Code’). The Code is an incorporated document and therefore forms part of the Scheme.[1]
[1]Mount Alexander Planning Scheme cl 81.01.

It is proposed to situate the three broiler farms well apart from one another: Farm 1 is to be located on the extreme north-western corner of the land; Farm 2 on its north-eastern corner; and Farm 3 near the southern boundary of the land, roughly equidistant from Farm 1 and Farm 2. This configuration means that each of the farms is located close to one or more of the boundaries of the land and adjacent to neighbouring properties rather than at or towards the centre of the land.

The proposed dispersion of the broiler farms across the land prevents them from being classified as a ‘Farm Cluster’ and makes it possible for them to qualify individually as a particular class of broiler farm pursuant to the Code, namely, as a ‘Class B’ broiler farm, which in turn simplifies the permit application and approval process. For a broiler farm with a capacity of up to 400,000 birds to qualify as a Class B broiler farm, the Code requires there to be a ‘separation distance’ of at least 686 metres from any ‘sensitive use’ and from any other broiler farm. A permit application for a Class B broiler farm does not require the inclusion of an Odour Environmental Risk Assessment (‘Odour ERA’) or the involvement of the Environment Protection Authority (‘EPA’) in the permit application process. An application for a permit for a Farm Cluster does.

The proposal to separate the proposed broiler farms from one another by reference to the prescribed ‘separation distance’ in the Code has had the effect of placing the farms close to neighbouring properties. The applicants for leave to appeal are immediate neighbours. They objected to the permit applications when they came before the Council.

The Council refused the permit applications and, on 13 November 2014, the respondent applied to the Victorian Civil and Administrative Tribunal (‘Tribunal’) pursuant to s 77 of the PE Act to review the Council’s decisions.

On 23 December 2014, the Tribunal made an order fixing 23 March 2015 as the date for the hearing of the applications for review. On 6 February 2015, well before the hearing date, the first respondent gave notice of his intention to amend the application plans. Amended plans, which changed the orientation of the proposed broiler sheds but did not alter their size or location, were circulated at that time.

Following circulation of the amended plans, but before the Tribunal hearing could take place, another set of events occurred. These events gave rise to a preliminary hearing and interim determination by the Tribunal, and then to an appeal to a judge sitting in the Trial Division of the Court pursuant to s 148 of the Victorian Civil and Administrative Appeals Tribunal Act 1998 (‘VCAT Act’). The decision of the judge at first instance is the subject of the present application for leave to appeal.

On or about 20 March 2015, just three days before the scheduled Tribunal hearing, a prefabricated house was installed on the land of each of two neighbouring objectors, Mr Forbes and Mr Smith. Dwellings are a ‘sensitive use’ for the purposes of the Code. Mr Forbes’ house is within the prescribed separation distance of Farm 1; Mr Smith’s house is within the separation distance of Farm 2. The new houses were installed in a day and did not require a planning permit under the Scheme.

When the hearing commenced in the Tribunal on 23 March 2015, counsel for the objectors raised a preliminary issue, being the existence of the new houses within the separation distances of Farms 1 and 2. The objectors submitted that the existence of the houses effectively precluded the grant of planning permits for Farm 1 and Farm 2 as they could no longer be classified as Class B broiler farms.

After the objectors had made submissions on the effect of the installation of the houses, the respondent applied to substitute the amended plans for the original application plans. The application to substitute the amended plans was opposed, but there was apparently no argument on the question.[2] Nonetheless, by order made on 1 April 2015, the Tribunal substituted the amended plans for the application plans. It also set a timetable for the parties to file and serve written submissions on the following questions:

a.[Is] the presence of the nearby recently constructed structures on the Forbes and Smith land to be taken into account in assessing sensitive uses and separation distances for the three proposed 400,000 bird broiler farms being applied for?
b.Is the relevant time for consideration of classification and assessment of the proposed broiler farms fixed at and limited to the date on which the permit applications were lodged with the responsible authority?
…

[2]Transcript of this hearing is unavailable.

The Tribunal then made an interim determination[3] on the basis of the written submissions without hearing any further from the parties. In its interim determination, the Tribunal answered the two questions as follows:[4]

a. No.
b.Yes in relation to the classification of broiler farms and yes in relation to new dwellings established within the proposal separation distances and in relation to proposed change to broiler farms after the making of the present application but otherwise not necessarily.

[3]Vukadinovic v Mount Alexander SC [No 3] [2015] VCAT 1164.

[4]Ibid [170].

Relevantly, the Tribunal determined that the existence of the new houses within the separation distances for Farms 1 and 2 was not to be taken into account when considering separation distances and determining the classification of the proposed broiler farms.

The Tribunal did not consider it necessary to determine whether the installation of the new houses was a ‘sham’ as was submitted by the respondent.[5]
[5]Ibid [154].

Having answered the preliminary questions, the Tribunal heard the three applications for review on the merits. In its final determination,[6] the Tribunal directed that a permit issue for each broiler farm. Notably, in assessing the proposed broiler farms against relevant planning policies and the Code, the Tribunal did not take the presence of the new houses into consideration for any purpose.
[6]Vukadinovic v Mount Alexander SC [No 6] [2015] VCAT 1993.

In the course of its final determination, the Tribunal considered the meaning of the word ‘property’ in one of the measures in the Code directed to ensuring that sensitive uses could subsequently be established on neighbouring properties without breaching separation distances. The relevant measures provide that the minimum separation distance should cover no more than 50 per cent of the area of a property located beyond the broiler farm property boundary and that the remaining area of the neighbouring property remain capable of accommodating a building envelope of a designated size. The Tribunal held that the word ‘property’ in that context did not mean ‘lot’.[7] Rather, it meant something akin to a ‘tenement’, namely, lots in the same ownership adjoining one another.[8]
[7]Ibid [183]–[185].
[8]Ibid [182].

The applicants appealed the Tribunal’s orders to the Supreme Court pursuant to s 148 of the VCAT Act raising, relevantly, the following grounds of appeal:[9]

1.The Tribunal erred in law in holding that the presence of recently constructed dwellings on the Forbes and Smith land is not to be taken into account in assessing separation distances from sensitive uses for each of the three proposed 400,000 bird broiler farms;
2.The Tribunal erred in law in holding that the relevant time for classifying, and assessing the separation distances for, the broiler farms is fixed on the day or days on which the permit applications were lodged with the responsible authority;
3. The Tribunal erred in law in directing that each proceeding ought to be listed for hearing in circumstances where, based on the Tribunal’s findings of fact, the [Scheme], incorporating the [Code], prohibited the grant of a planning permit in respect of the applications which are the subject of proceedings P2030/2014 and P2031/2014, as those applications cannot meet the separation distance requirements as defined by Formula 1 of the [Code];
4.The Tribunal erred in holding that the word ‘property’ in Approved Measure E1 M5.1 of the [Code] means land comprised in a lot which does not adjoin another lot in the same ownership, or lots in the same ownership and which adjoin each other, where lots are considered to adjoin each other if they are separated only by a stream, stream reserve, or unmade or unused government road or rail reserve;
5.The Tribunal erred in holding that the word ‘property’ in Approved Measure E1 M5.2 of the [Code] means land comprised in a lot which does not adjoin another lot in the same ownership and which adjoin each other, where lots are considered to adjoin each other if they are separated only by a stream, stream reserve, or unmade or unused government road or rail reserve.

[9]Forbes v Vukadinovic [2017] VSC 20 [11].

In Forbes v Vukadinovic,[10] the judge at first instance granted leave to appeal for grounds 1 to 5, but dismissed the appeal in relation to those grounds.[11] The judge held that the proper construction of the Code required:[12]

1.the measurement of the separation distance and classification of the broiler farm under Section 5 [of the Code], by reference to the facts existing as at the date of the application;
2.the determination of all other factual matters (including the application of the form design and operation elements under Section 7 [of the Code], and all other Code and planning considerations) by reference to the facts as known at the date of the decision; and
3.the determination of the law applying to the application as at the date of the decision.

[10]Ibid.

[11]Leave to appeal was refused for the remaining grounds.

[12]Forbes v Vukadinovic [2017] VSC 20 [139].

The judge also held that the word ‘property’ as used in Approved Measures E1 M5.1 and E1 M5.2 of the Code simply meant ‘rural land holding’, which, in a Farming Zone, would usually be a farm. The word ‘property’ should not be read down to mean ‘lot’.[13]
[13]Ibid [155].

Grounds of Appeal

The proposed grounds of appeal are that the court below erred in law by:

1.Holding that the classification of a proposed broiler farm under the Code takes place at the time of the application for permission under the PE Act to use or develop land for the purpose of a broiler farm;
2.Further or in the alternative, holding that the classification of a proposed broiler farm under the Code does not take place at the time when an application for permission under the PE Act to use or develop the land for the purpose of a broiler farm is amended under s 127 and/or clause 64 of Part 16 of Schedule 1 to the VCAT Act;
3.Holding that the presence of recently constructed dwellings on the Forbes and Smith land were not to be taken into account in assessing separation distances from sensitive uses for each of the three proposed 400,000 bird broiler farms;
4.Holding that the word ‘property’ in Approved Measures E1 M5.1 and E1 M5.2 means ‘rural land holding’.

The Law

The judge at first instance set out in uncontroversial fashion the law governing the Tribunal’s exercise of its power to review a decision by a responsible authority under the PE Act to refuse a planning permit. The applicants for leave do not disagree with his Honour’s statement of the relevant legal principles and nor do I.

The leading case identified by the judge (and by the parties) on the temporal aspect of the facts relevant to decision-making by an administrative tribunal carrying out a review of an administrative decision is Shiv Migration Agents Registration Authority,[14] in which the High Court of Australia held that the Commonwealth Administrative Appeals Tribunal (‘AAT’), when reviewing a decision of the Migration Agents Registration Authority, was obliged to consider the facts and circumstances as they existed at the time of its own decision and was not limited to the facts before the original decision-maker. However, this was based on the provisions of the enabling legislation. Justice Kirby said:[15]

Here, the issue is how to define the jurisdiction and powers of the Tribunal in conducting a review of a decision of the Authority, having regard both to the general provisions of the AAT Act, affording the power of review, and to the more specific provisions of the Migration Act, defining the characteristics of the decision that is subject to review. Only when all of the relevant features of the two inter-related statutes are understood can a correct decision be arrived at as to the ambit of the review in question and the manner in which it should be conducted.

[14](2008) 235 CLR 286 (‘Shi’).

[15]Ibid 295 [25] (emphasis in original).

In this case, the inter-related statutes that define the jurisdiction and powers of the Tribunal when conducting a review of the decision of a responsible authority to refuse a planning permit are the PE Act and the VCAT Act. The VCAT Act contains the more general provisions, while the PE Act contains more specific provisions of the Tribunal’s powers and functions when reviewing a decision by a responsible authority to refuse a planning permit.

The purpose of the PE Act is to establish a framework for planning the use, development and protection of land in the present and long-term interests of Victorians.[16] One of the objectives of the planning framework is to establish a system of planning schemes to be the principal way of setting out objectives, policies and controls for use, development and protection of land.[17] Where a planning scheme requires a planning permit for the use and development of land, the responsible authority, usually a municipal council, is charged with making the planning permit decision in accordance with the PE Act. This involves applying (and complying with) the relevant planning scheme. Section 14 of the PE Act provides, inter alia, that the duties of a responsible authority are to efficiently administer and enforce the planning scheme, to implement the objectives of the planning scheme and to comply with the PE Act and the planning scheme.[18]
[16]PE Act s 1.
[17]Ibid s 4(2)(b).
[18]More generally, s 16 of the PE Act provides that a planning scheme is binding on every Minister, government department, public authority and municipal council except to the extent that the Governor in Council, on the recommendation of the Minister, directs by order published in the Government Gazette.

Part 4 of the PE Act confers upon the responsible authority the power to grant a planning permit, to grant a permit subject to conditions, and to refuse to grant a permit on any ground it thinks fit.[19] The matters that a responsible authority must consider are set out in s 60(1) of the PE Act. They include the planning scheme and the objectives of planning in Victoria, as well as any significant effects on the environment and any significant social and economic effects of the proposal. Section 60(1A) contains the matters the responsible authority may consider if the circumstances appear to so require, including nominated approved strategy plans, and amendments to the planning scheme and to the nominated approved strategy plans adopted but not approved as at the date on which the application is considered.
[19]PE Act s 61.

Division 2 of Part 4 of the PE Act governs reviews of such decisions by the Tribunal. Section 77 provides that an applicant for a permit may apply to the Tribunal for review of a decision by a responsible authority to refuse to grant the permit. Section 85(1) provides that after hearing an application for review, the Tribunal may, relevantly —

a.direct that a permit must not be granted; or
b.in the case of an application for a review of a refusal or failure to grant or a decision to grant a permit—
i.grant the permit and direct the responsible authority to issue it; or
ii.grant the permit, direct that the permit must or must not contain any specified conditions and direct the responsible authority to issue the permit;

Section 84B of the PE Act sets out the matters the Tribunal must ‘take account of’ and ‘have regard to’ when conducting a review under the PE Act. Section 84B(1) requires the Tribunal to take into account and have regard to any matter which the person or body in respect of whose decision the application for review was made (in this case, the Council) properly took account of or had regard to in making its decision, or was required to take account of or have regard to in making its decision. Section 84B(2) requires the Tribunal to take into account, inter alia, any relevant planning scheme, the objectives of planning in Victoria, nominated approved strategy plans (where appropriate) and relevant State environment protection policies. The Tribunal is also required to take into account any amendments to the planning scheme and to the nominated strategy plans adopted but not, as at the date upon which the application for review is determined, approved by the Minister. Further, the Tribunal must, where appropriate, take account of the extent to which persons residing or owning land in the vicinity of the land which is the subject of the application for review were able to and did in fact participate in the procedures required to be followed under the PE Act before the responsible authority could make a decision in respect of the application for a permit.[20]
[20]Ibid s 84B(2)(f).

Although there is considerable overlap, the matters to which the Tribunal must have regard are not co-extensive with the matters which the responsible authority had to consider, and include matters that have come into existence or changed since the decision of the responsible authority.

Further, s 5 provides that the PE Act applies to any planning scheme approved under the PE Act ‘as in force from time to time under this Act’. The planning scheme, which is central to the decision-making of both the responsible authority and the Tribunal, is therefore to be applied in its form as at the date of the permit decision, be it the decision of the responsible authority or the decision of the Tribunal on review.

In Shi, Hayne and Heydon JJ identified the nature of the AAT’s review jurisdiction by reference to its broad powers to inquire and require the provision of information:[21]

Once it is accepted that the Tribunal is not confined to the record before the primary decision-maker, it follows that, unless there is some statutory basis for confining that further material to such as would bear upon circumstances as they existed at the time of the initial decision, the material before the Tribunal will include information about conduct and events that occurred after the decision under review. If there is any such statutory limitation, it would be found in the legislation which empowered the primary decision-maker to act; there is nothing in the AAT Act which would provide such a limitation.

[21]Shi (2008) 235 CLR 286, 315 [99].

The provisions of the VCAT Act give the Tribunal scope to make its own inquiries when exercising both its original jurisdiction and its review jurisdiction. Section 97 of the VCAT Act provides that the Tribunal must act fairly and according to the substantial merits of the case in all proceedings. Section 98 provides, inter alia, that the Tribunal is bound by the rules of natural justice, but is not bound by the rules of evidence or any practices or procedures applicable to courts of record, except to the extent that it adopts those rules, practices or procedures, and that the Tribunal may inform itself on any matter as it sees fit.

The Tribunal is not confined to the facts upon which the responsible authority made its decision or the facts that existed at the time the permit application was lodged. In the absence of a clear indication to the contrary in the relevant planning scheme, or in any relevant strategy plan or environment protection policy to which regard must or should be had, the legislative provisions to which I have referred to give rise to the implication that the Tribunal is concerned to make its permit decision on the basis of the facts as they exist at the time of that decision.

This analysis is supported by the nature of the permit decision itself. In Hoskin v Greater Bendigo City Council,[22] the Court of Appeal confirmed that in determining whether a permit should be granted, the responsible authority in the first instance, and the Tribunal, in turn, must ultimately consider whether the proposed use and development is in the public interest in the sense that the proposal will result in net community benefit. To like effect, cl 65 of the Scheme requires a responsible authority to decide whether a proposal for which a planning permit is sought will produce ‘acceptable outcomes’. Describing the nature of the task that this entails, the Court of Appeal stated: [23]

Both the terms of s 60 and the terms of cl 65.01 of the planning scheme mean that the consideration of most planning permit applications is multifactorial. It will require not only a predictive judgment as to potential factual consequences of the proposed use or development but also an evaluation of the weight to be given to individual matters in the context of the case as a whole.

[22](2015) 48 VR 715 (‘Hoskin’).

[23]Hoskin (2015) 48 VR 715, 729 [54].

Such an assessment or evaluation, directed to furthering the public interest in achieving good planning outcomes, cannot reasonably be made in disregard of relevant facts or circumstances in existence at the time the assessment or evaluation is made.

As a result, it is well accepted that when conducting a review of a decision made by a responsible authority to refuse a permit under Division 2 of Part 4 of the PE Act, the Tribunal stands in the shoes of the original decision-maker — in this case, the Council — and must make the correct or preferable decision as to whether a permit should issue having regard to the material before it. The review is generally to be carried out on the basis of facts and law at the time of the Tribunal’s own decision.[24] In Shi, Kirby J described this as a ‘rule of practice’.[25] I shall also refer to it as such.
[24]Von Hartel v Macedon Ranges Shire Council (2014) 48 VR 632, 644-645 [50]-[53].
[25]Shi (2008) 235 CLR 286, 299 [41].

However, where an enabling enactment expressly or impliedly requires a review to be conducted by reference to the factual position at a particular point in time, that requirement must be complied with. In this case, the Tribunal and the court below were obliged to consider as part of the statutory arrangements not only the policies contained in the Scheme, but also the Code as part of the Scheme. Both the Tribunal and the judge at first instance held that a departure from the rule of practice was required by the language, structure and purpose of the Code.

It follows that it is necessary to consider the text and context of the Code to determine whether the Code, as part of the Scheme, required a departure from the rule of practice that the Tribunal exercises its review jurisdiction under the PE Act and the VCAT Act by reference to the facts in existence at the time of its own decision.

The Code

The Code governs the planning, design, assessment, approval, construction, operation and management of broiler farms in Victoria and records that it seeks to create an appropriate balance between the operational needs of the broiler farm industry and the protection of the environment, particularly the air environment for people who live near broiler farms.[26]
[26]Victorian Code for Broiler Farms 2009, 3 (‘Code’).

The purpose of the Code is described as follows: [27]

1.Deliver sound environmental performance in the planning, design, construction, operation and management of broiler farms
2.Protect local amenity from adverse impacts, including offensive odours, dust, noise and visual impacts
3.Protect the surrounding environment from adverse impacts
4.Permit an economically viable, competitive and sustainable broiler farm industry.

[27]Ibid 4.

To achieve these purposes, the Code sets requirements for the:[28]

·siting and size of broiler farms;
·application of best practice in the design, construction, operation and management of broiler farms to satisfy relevant environmental standards;
·preparation, assessment and determination of broiler farm development proposals through the planning permit system; and
·ongoing monitoring of broiler farm operations through routine audits.

[28]Ibid 4.

The Code is divided into sections or chapters. Relevantly, it deals with the following matters in sequence:

(a)Key amenity and environmental issues (Section 4);
(b)Classification of broiler farms (Section 5);
(c)Farm design and operation elements (Section 7);
(d)Application process (Section 10);
(e)Strategic and land use planning considerations (Section 11).

Section 4 sets out the amenity and environmental issues which must be considered in the development of a new broiler farm.[29] The key amenity issues are identified as odour, dust, noise, light spill and visual amenity.[30] Section 4 sets out three ways of preventing emissions from adversely impacting on nearby sensitive uses: (1) the use of a boundary setback or ‘buffer’; (2) the provision of a separation distance between the broiler shed and existing or potential sensitive uses; and (3) the employment of best practice in the design, siting, operation and management of the broiler farm.[31]
[29]Or broiler farm expansion.
[30]Code, 12–15.
[31]Ibid 13.

Section 5 provides for the classification of broiler farms. Pursuant to the Code, broiler farms are classified according to their level of environmental and amenity risk. The Code contains different approval requirements for planning permit applications and different notification and review rights depending on farm classification.

There are four farm classifications: Class A, Class B, Special Class and Farm Cluster. In any instance, farm classification is dependent upon:

·the number of birds kept on the farm;
·the ability to provide the required separation distance within the broiler farm boundary; and
·the proximity to other existing and proposed broiler farms.[32]

[32]Ibid 16.

The Code contains a formula to determine the required minimum separation distance, which is based on the proposed farm capacity. For 400,000 birds, the mandated separation distance is 686 metres from the external edge of a broiler shed to the nearest sensitive use.[33] A sensitive use is defined as a use that involves the presence of people, causing the use to be sensitive to amenity considerations such as odour, dust and noise.[34] The definition includes dwellings, residential buildings, hospitals, schools, day care centres, caravan parks and other uses involving the presence of people for an extended period, but does not include recreational areas such as parks and sporting facilities.[35]
[33]Ibid 18.
[34]Ibid 61.
[35]Ibid.

A broiler farm will be classified as a ‘Class A’ farm if the farm capacity is less than or equal to 400,000 birds and the minimum separation distance requirement is fully contained within the broiler farm boundary.[36] A Class B broiler farm has the same capacity, but the separation distance is not fully contained within the broiler farm boundary.[37] A broiler farm will be classified as ‘Special Class’ if the farm capacity is greater than 400,000 birds or the development is unable to meet the minimum separation distance requirement but a reduction in separation distance is warranted through the adoption of odour reduction technology.[38] A ‘Farm Cluster’ exists where separation distances between existing or proposed broiler farms overlap and the combined farm capacity is greater than 400,000 birds.[39]
[36]Ibid 16.
[37]Ibid 17.
[38]Ibid.
[39]Ibid.

A permit application for a Special Class broiler farm or a Farm Cluster is significantly more onerous than for Class A or Class B farms. The Code requires an Odour ERA to be completed in accordance with the Code, and notice of the application for a Special Class broiler farm or a Farm Cluster to be given to the EPA in accordance with s 52(1)(c) of the Act.[40]
[40]Ibid 16, 17.

An Odour ERA is a staged process of modelling and analysing odour emissions from broiler farms that enables the responsible authority to assess the acceptability of the risk of offensive odour adversely impacting beyond the broiler farm property boundary.[41] Section 6 of the Code requires an Odour ERA to be presented in a manner which enables the responsible authority to determine the acceptability of the risk of offensive odour adversely impacting on the amenity of existing sensitive uses beyond the broiler farm boundary and the orderly and sustainable use and development of land beyond the broiler farm property boundary having regard to, among other things, the existing and likely future use and development of the land, including any approved sensitive use.
[41]Ibid 20.

Section 7 of the Code sets out the best practice elements of broiler farm siting, design and operation. The elements are dealt with in the following three parts:

(a) location, farm size and setback requirements;

(b) farm design;

(c) farm operation and management.

The controls imposed by Section 7 are based on compliance with ‘objectives’, ‘standards’ and ‘approved measures’ in respect of each element. The hierarchy of objectives, standards and approved measures is as follows:

(a) An objective describes the desired outcome to be achieved from the completed development and operation of the broiler farm. All permit applications must satisfy the objectives for each element.

(b) A standard contains the requirements to meet the objective, and all permit applications must comply with all relevant standards.

(c) An approved measure is an approach, action, practice or method that permit applicants should incorporate into their development proposal to comply with the relevant standard. Where the development proposal adopts all of the approved measures for a standard, the application is deemed to comply with the standard.[42]

[42]However, alternative measures are recognised as long as the applicant can demonstrate to the responsible authority’s satisfaction that the relevant Code objectives and standards can still be met with the equivalent or superior performance.

Element 1 (E1) relates to the location, siting and size of the broiler farm. The objective of E1 is to ensure the location and size of the broiler farm, and the siting of the broiler sheds, temporary litter stockpiles, compost piles and litter spreading areas:

·minimise the risk of adverse amenity impacts on nearby existing, planned and potential future sensitive uses as a result of odour, dust and noise;
·do not adversely affect the use and development of nearby land;
·avoid pollution of ground and surface waters;
·avoid adverse impacts on the visual quality of the landscape; and
·minimise biosecurity risks.[43]

[43]Code, 26.

E1 has a number of standards for which there are approved measures. There is a standard in relation to each of amenity protection, waterway protection, the visual quality of the landscape, biosecurity and the future use and development of neighbouring land. Standard E1 S1 concerns the first aspect — minimising adverse amenity impacts — and is as follows:[44]

Adverse impacts on the amenity of the surrounding area are minimised by ensuring broiler sheds, temporary litter stockpiles, compost piles and litter spreading areas are adequately separated from existing and planned residential and rural living areas, sensitive uses and broiler farm property boundaries.

[44]Ibid.

The approved measures in relation to Standard E1 S1 involve the establishment of setbacks and separation distances from sensitive uses such as residential uses.

Standard E1 S5 concerns the future use and development of neighbouring land. Standard E1 S5 is as follows:[45]

Broiler sheds are situated so that offensive odour, dust and noise emissions will not adversely impact the orderly and sustainable use and development of land located beyond the farm property boundary, including the ability to establish a dwelling (excluding a bed and breakfast or caretaker’s house) on vacant property, having regard to:
·the existing and likely future use and development of the land including any approved sensitive uses;
·the existing physical and environmental characteristics of the land;
·the purpose and requirements of the zone applying to the land; and
·any applicable land use decision guidelines, policies and strategies in the planning scheme.

[45]Ibid 29.

Approved measure E1 M5.1 relates to the use and development of nearby land and provides, in relation to Class B farms, that the required minimum separation distance cover no more than 50 per cent of the area of a property located beyond the broiler farm property boundary. Approved measure E1 M5.2 provides, again in relation to Class B farms, that where a property located beyond the broiler farm property boundary is not currently developed with a dwelling, the remaining area of the property (unaffected by the separation distance requirement) must be capable of providing a 20 metre x 30 metre building envelope for a dwelling taking into account a number of siting considerations.[46]
[46]Ibid.

Section 10 outlines the process for the submission, assessment and approval of a planning permit. The process is divided into consecutive stages: site selection, farm classification and consultation (Stage 1); preparation and lodgement of the planning permit application (Stage 2); assessment, notice and determination of applications (Stage 3); review of an application following determination by the responsible authority (Stage 4); and issuing a planning permit (Stage 5).

Stage 1 includes the requirement that the permit applicant determine whether the proposed development is Class A, Class B, Special Class or Farm Cluster.[47] In respect of the latter two categories, the applicant is advised, as part of the Stage 2 process, to contact the EPA to seek advice regarding the Odour ERA requirements.[48]
[47]Ibid 48.
[48]Ibid.

Section 10 contains a figure illustrating the planning application process.[49] The figure is divided into four parts reflecting the first four stages. Stage 1 contains a box referring to discussions with the responsible authority and others for the purpose of finalising the location, size, layout and design of the proposed farm and basing the farm classification on these discussions. Stage 2 then involves the preparation of application documentation based on the classification arrived at through Stage 1.
[49]Ibid 51.

Appendix 5 is a ‘Proposal Summary and Application Checklist’ which contains a ‘Proposal summary’ to be completed by the permit applicant requiring the applicant to identify the class of the proposed broiler farm.[50]
[50]Ibid 72-76.

Section 11 provides ‘guidance’ on land use planning for, among other things, the development of new sensitive uses close to existing broiler farms. Section 11 states that when assessing a permit application for a new or expanded broiler farm, the responsible authority must consider how the broiler farm may impact on the orderly and sustainable use and development of surrounding land having regard to, among other things, the existing and likely future use and development of the land.[51] It records that Standard E1 S5 and its associated measures aim to ensure that sufficient land use flexibility is maintained for adjoining landowners to adapt to future changes.[52]
[51]Ibid 52.
[52]Ibid.

In relation to ‘as of right’ new residential uses near existing broiler farms, the Code states:[53]

In some circumstances, planning permission is not required to build a dwelling in a rural area. If the proposed dwelling is to be sited close to a broiler farm, where there is potential for impact from odour and noise emissions, conflict can arise. Councils should explore how to advise future residents, so steps can be taken to minimise impacts, such as:
·Siting the dwelling further from the broiler farm;
·Siting the dwelling up slope from the broiler farm;
·Using vegetation to provide visual screening.
[53]Ibid 54.

The Decision at First Instance

The question raised by the first three grounds of appeal from the Tribunal’s decision to the Trial Division of the Court was, in substance, whether the language, structure and purpose of the Code required a departure from the rule of practice that the Tribunal decides an application for review of a decision to refuse or to grant a planning permit on the basis of the facts in existence at the time of the Tribunal’s own decision.

The judge at first instance held that the proper construction of the Code required:[54]
[54][2017] VSC 20 [139].

(1) the measurement of the separation distance and classification of the broiler farm under Section 5, by reference to the facts existing as at the date of the application;

(2) the determination of all other factual matters (including the application of the form design and operation elements under Section 7, and all other Code and planning considerations) by reference to the facts as known at the date of the decision; and

(3) the determination of the law applying to the application as at the date of the decision.

The judge gave the following reasons for construing the Code in this way:[55]
[55]Ibid [140] (emphasis in original) (citations omitted).

(1) The application process is described in Section 10 of the Code. It consists of five stages. Farm classification is part of ‘Stage 1: Site selection, farm classification and consultation’. This is the first and earliest stage of the application process. The second stage concerns the preparation and lodgement of a planning permit application. The whole planning process is predicated on the classification resulting from the first stage.

(2) Section 10 of the Code is concerned with classification and the application process and expressly provides that ‘[t]he applicant must determine whether the proposed development is a Class A, Class B, Special Class or Farm Cluster’. This does not mean that a decision by the applicant as to the classification of the proposed broiler farm cannot be reviewed by the responsible authority or the Tribunal; but it does suggest that the date of the application is the relevant time for the determination of the classification.

(3) The classification ascribed to a proposed broiler farm governs the documentation to then be prepared by the applicant, the need for an Odour ERA to be undertaken, and the need to consult with, and notify, the EPA. It is crucial for the responsible authority, the applicant and the EPA to know whether an Odour ERA is required to be prepared. This is made doubly clear by Figure 3: ‘Illustration of Planning Application Process’ in the Code. It is the broiler farm classification that dictates the documentation, notification and review process relating to the permit application. It is essential that the classification be determined at an early stage.

(4) If the date for the determination of the classification of the broiler farm were to be the date of the decision, a significant mischief and inconvenience would arise. The location of a prefabricated dwelling, or the commencement of a sensitive use within the separation distance would upset the previous classification of a proposed broiler farm. This might occur even as late as the day before the Tribunal decision is published. The result is the transformation of the application. It is a ‘back to the drawing board’ situation with an Odour ERA having to be prepared and the EPA notified. The responsible authority and all parties would have to start afresh in addressing the application. The application would have to be readvertised to authorities and interested parties alike. The previous deliberations of the responsible authority would be superseded by the classification change. There would be significant delays, confusion and very substantial additional costs to the applicant and other parties.

(5) The Code provides that notice of an application for a Special Class or Farm Cluster broiler farm should be given to the EPA as soon as the permit application is received, so that the EPA can provide its response and enable the responsible authority to require any information early in the application process. Again, this suggests that classification occurs at the time of the application not the decision.

(6) The object of the planning process is to determine whether there is a net community benefit arising from an application, having regard to all relevant planning considerations and legal requirements. It is most undesirable that the planning process be exposed to dislocation by unmeritorious tactical devices or contrivances intended to stymie the opposing party’s case. Rather, the planning process seeks to ensure that all interested parties have a proper opportunity to be heard about an application and then for the decision maker to fairly and rationally determine the application based on the considerations described in the relevant planning scheme and any applicable codes. It is important for delays and costs to be kept to a minimum.

(7) The planning process aims ‘to balance the present and future interests of all Victorians’. The construction of the Code that I accept would provide for fairness and a reasonable balance between the respective interests of all concerned.

(8) In Section 11 of the Code, titled ‘Strategic and Land Use Planning Considerations’, the responsible authority is advised to discourage the location of dwellings close to broiler farms. It advises that steps should be taken to minimise impacts, for example, by resiting proposed dwellings or through the use of visual screening. It is consistent with this advice that establishing dwellings within separation distances should not be encouraged after an application has been made but before the final decision has been made, whether by the responsible authority or the Tribunal.

According to the judge, a construction of the Code that requires a preliminary classification process on the basis of circumstances fixed in time recognises the need for the permit application to be classified at the date of the application, whilst responding to the law and principles stated in Shi[56] and other cases. All other matters are to be determined at the date of the permit decision, enabling the circumstances operative as at the date of the decision to be considered in evaluating the planning merits, including any new uses, developments or changes that have occurred since the application was submitted.[57]
[56](2008) 235 CLR 286.
[57][2017] VSC 20 [141].

The judge’s construction of the Code differed from that of the Tribunal in two respects. While the Tribunal held that the determination of separation distances as at the date of the permit application applied only in relation to houses and not to other sensitive uses, the judge held that the nature of the sensitive use was not material.[58] Secondly, his Honour held that the Tribunal could take into consideration the existence of the two new dwellings for all purposes other than for farm classification.[59] This was because the ‘best practice elements’ in Section 7 were separate from, and additional to, the determination of farm classification and separation distances.
[58]Ibid [147].
[59]Ibid [149].

While the Tribunal did not take into account the existence of the two houses in its review of the merits of the proposals, the judge held that this was not a vitiating error, the difference being immaterial in the circumstances of the Tribunal’s view of the merits of the permit applications, and the lack of merit of the objections.[60]
[60]Ibid.

In relation to the final ground of appeal, the judge held that the word ‘property’ as used in approved measures E1 M5.1 and E1 M5.2 simply meant ‘rural land holding’ and should not be read down to mean ‘lot’.[61] This was based on the dictionary definitions of the word ‘property’, the fact that the zoning context in the Code in which the word ‘property’ is found was a broad acre farming context in circumstances where the Code was concerned to preserve the opportunity for farm owners and occupiers to reside on their farms, rather than with the erection of dwellings on lots.[62]
[61]Ibid [155].
[62]Ibid [156].

Ground 1

Ground 1 is that the judge at first instance erred in ‘holding that the classification of a proposed broiler farm under the Code takes place at the time of the application for permission under the Act to use or develop land for the purpose of a broiler farm’.

This ground of appeal concerns the proper construction of the Code and, in particular, whether the Code has displaced the rule of practice that the Tribunal determines a review of a planning permit decision on the basis of the facts in existence at the time of its own decision rather than at the time of the earlier decision or the time that the permit application was lodged. The applicants for leave to appeal contend that the judge erred in holding that the classification of the proposed broiler farm was a discrete step in the permit application process that was to be undertaken on the basis of the facts in existence at the time the permit application was lodged.

The construction of the Code advanced by the first respondent is based on the manner in which the Code ‘stages’ the permit application process. Before describing the criteria for the different classes of broiler farm, Section 5 identifies the first ‘key step’ in preparing a planning permit application to be the determination of the farm classification. This ‘determination’ is necessarily made by the permit applicant as the precursor to preparing the application documentation. The second, third and fourth stages of the application process are based on the classification of the broiler farm in the first stage. Section 10, with its staging diagram, visually distinguishes Stage 1 from Stage 2. Stage 1 involves site selection, site evaluation and farm classification; Stage 2 then separates the preparation of the permit application documentation into three channels depending on the determination of the farm classification in Stage 1.

It is self-evident that the preparation of the permit application begins with the permit applicant working out what he or she believes to be the correct farm classification based on proposed bird numbers and the ability of the proposal to provide clear separation distances from existing sensitive uses. The fact that the permit application process begins in this way begs the question, however, as to whether the Code gives this first ‘key’ step such a special character as to require farm classification to be established in a different temporal (and, therefore, potentially, physical) context from the context in which the assessment of the broiler farm proposal on its merits is to take place.

The first respondent seeks to emphasise the special character of the permit applicant’s classification of the broiler farm proposal by submitting that a failure by the permit applicant to correctly undertake the classification process will render the permit application void. This is submitted to be because a broiler farm in a Farming Zone is a discretionary Section 2 use that is subject to a mandatory condition requiring compliance with cl 52.31 of the Scheme, which in turn requires compliance with the Code. According to the first respondent, it is a mandatory requirement of the Code that the permit applicant correctly classify the broiler farm proposal. If the permit applicant incorrectly classifies the proposal (for example, as a Class A Farm where the formula in the Code produces a separation distance that does not fall entirely within the property boundary), the permit application will be non-compliant with the condition in the Farming Zone, the proposed development ‘prohibited’ and the responsible authority must reject the permit application. Accordingly, so the first respondent contends, before the merits of the permit application can be considered there must be a valid farm classification. At the point of classification, the merits of the proposal — whether it is going to generate noise, dust or traffic movements and so on — are not relevant. Classification is a preliminary and discrete step that must be carried out correctly by the permit applicant.

I am not persuaded that the Code stages the application process in the manner and with the result contended for by the first respondent, that is, so as to freeze the factual basis for the classification decision in time and require consideration of the proposal’s compliance or non-compliance with separation distances to be based on factual circumstances in existence at a time removed from the time when the proposal is assessed and the permit decision is actually made. The Code makes it clear in a variety of ways that separation distances are a critical planning control for the preservation of local amenity and that they are intertwined with the other measures in the Code protecting such amenity.

Thus, under the heading ‘Avoiding the adverse amenity impacts’, Section 4 of the Code states:[63]

Three ways of avoiding the above emissions [odour, dust and noise] from adversely impacting the amenity of nearby sensitive uses is to:
(1)Set any new broiler sheds, temporary litter stockpiles or compost piles back from the broiler farm boundary (the boundary setback or ‘boundary buffer’ in the previous Code).
(2)Provide a separation distance between the broiler shed and existing or potential sensitive uses.
(3)Employ best practice in the design, siting, operation and management of the broiler farm (including landscaping).

[63]Code, 13.

Section 4 goes on to explain the purpose of separation distances as follows:[64]

Separation distances provide sufficient space to minimise the risk of offensive odour and dust emissions under both routine and abnormal (or upset) conditions adversely impacting the amenity of existing sensitive uses. The greater the separation distance and the boundary setback, the lower the probability of adverse odour and dust adversely impacting the surrounding community.

[64]Code, 13 (emphasis in original).

The combination of setbacks, separation distances and the application of best practice in the design and operation of the farm as the means of protecting amenity is further reinforced in the Code under the heading ‘Best practice planning and management’:[65]

Broiler farms cannot rely solely on boundary setback and separation distances to avoid offsite impacts and associated complaints. Broiler farms must also employ best practice to manage and control emissions and waste. The separation distance requirements in this Code were established assuming that the design and ongoing management of broiler farms employ best practice.
In addition to effective ‘boundary setback’ and separating broiler sheds from sensitive uses (‘separation distances’), a combination of sound shed design, good farm management practices, including regular cleaning and maintenance of facilities, and effective waste management is essential to minimise the risk of offensive odour and dust emissions.

[65]Ibid 14.

Further, in Section 5, by way of introduction to the farm classifications, the Code states:[66]
[66]Ibid 16 (emphasis added).

The potential for broiler farm emissions to adversely impact on sensitive uses largely depends on:
·the distance to nearby sensitive uses that the proposed development may affect;
·the number of birds kept on the farm;
·the design, management and operation of the farm;
·local environmental conditions (including meteorology and topography.

The risk associated with a proposed development varies depending on the separation of emission sources from sensitive uses. This Code includes a formula that must be used to calculate the required separation distance between broiler sheds and sensitive use beyond the broiler farm boundary.
…
The separation distance is required to minimise the risk of routine and abnormal odour and dust emissions from the broiler sheds adversely impacting on nearby sensitive uses.

Importantly for present purposes, the introduction to Section 7 (Farm Design and Operation Elements) states that the requirements in Section 7 apply ‘in addition to’ the separation distance requirements used to determine farm classification that are found in Section 5.[67] One of the Farm Design and Operation Elements

— approved measure E1 M1.3 — provides for an increase in separation distances in certain circumstances, indicating that there is no ‘bright line’ between the operation of separation distances as a protective measure through the process of classification and their operation as a protective measure in other sections of the Code.
[67]Code, 26.

In my view, these passages of the Code confirm that separation distances are integrally connected to the other measures in the Code directed to preserving local amenity. The prescribed separation distance is not just a number to be factored into a formula to generate farm classification. Separation distances — as a critical planning tool — are put to work principally, though not exclusively, through the mechanism of classification. By the mechanism of classification, separation distances are given special force in the Code, in that farm classification affects the form and content of the permit application and thereby its prospects of success. However, this does not remove separation distances from the matrix of protective controls in the Code so as to require compliance with them to be considered in a discrete temporal context.

Insofar as the respondent suggests that the correct choice of classification by the permit applicant is a necessary precondition for the responsible authority to exercise its statutory power to grant a permit and that it therefore has something of the status of a jurisdictional fact, I reject that submission. While the permit applicant must decide what kind of broiler farm he or she proposes to develop in order to know how to frame and what to include in the permit application, the statutory power to determine the farm classification lies with the responsible authority and, on an application for review made pursuant to s 77 of the Act, with the Tribunal.

As a matter of law, therefore, the classification used by the permit applicant is not determinative of the classification of the proposed broiler farm. The decision by the permit applicant to proceed with an application for a particular class of broiler farm based on the proposed number of birds and the permit applicant’s own identification of nearby sensitive uses and measurement of separation distances is not a step in the process of classification in a legal sense. The issue of a planning permit for the use and development of land as a broiler farm is a statutory function vested in the responsible authority and, on review, in the Tribunal. The responsible authority, as the body empowered by statute to determine whether a permit should issue,[68] is required by the PE Act and the Code to take a number of steps in response to an application for a planning permit for a broiler farm, the first of which is to assess whether the permit application contains all necessary information, which in turn involves consideration of the classification attributed to the proposed farm by the permit applicant. However, the permit application must be determined on the basis of the correct classification as determined by the responsible authority (or the Tribunal on review).
[68]PE Act ss 47, 61.

The first respondent concedes that the classification chosen by the permit applicant does not determine the matter finally, in that the responsible authority (or the Tribunal on review) has to be satisfied that the proposed broiler farm has been correctly classified. He also concedes that there is no formal or separate decision about classification in a statutory sense, and that the Code does not include provision for the permit applicant to be told that the classification is correct. He submits, however, that the responsible authority must necessarily form a position on classification at the outset because, in order to comply with the Code, there has to be a compliant classification.

I accept that, as a matter of practice, the responsible authority (or the Tribunal on review) must form a view about whether the classification used by the permit applicant is the correct classification, and that this will usually occur at the beginning of its assessment of the permit application. However, this does not mean that the facts upon which the classification is based must be limited to those in existence on the date the permit application was lodged. The responsible authority (or the Tribunal on review) must, in effect, determine the classification of the proposed broiler farm in the course of assessing its compliance with the Code and the relevant planning scheme. There is nothing in the structure or language of the Code to indicate that this is not part of a single, continuous process undertaken by the responsible authority (or the Tribunal on review) in the exercise of its planning powers under the PE Act. To the contrary, the Code provides for the establishment of separation distances, and thereby classification, to form part of a package of measures directed to preventing adverse amenity impacts. Compliance with those measures should be assessed on the same factual basis.

The first respondent further submits that the Code evinces a clear intention to distinguish between ‘existing’ and ‘future’ or ‘potential’ sensitive uses and that whether something like a dwelling exists at a particular point in time will have significant consequences under the Code. He points out that ‘existing’ sensitive uses receive a high level of protection under the Code, insofar as a proposed broiler farm cannot be classified as Class A or Class B if there is a sensitive use within the separation distance. In such a case, there is an absolute prioritisation of the rights and interests relating to the sensitive use. However, the regime protecting ‘potential’ or ‘future’ sensitive uses is different altogether: things that might occur outside the separation distance in the future are not relevant for classification purposes. Thus, for example, a proposal for a 1,000 lot estate just beyond the separation distance would not affect the farm classification and would only become relevant when considering the merits of the proposed broiler farm. This, so the first respondent contends, reflects the intention of the Code to fully protect any existing sensitive use, but if the sensitive use is not present at the time of classification, it is only taken into account when assessing the merits of the proposal. If a sensitive use comes into existence after classification, the responsible authority will have regard to it, but it will not be a disqualifying consideration. It will be relevant to the assessment of the merits of the proposal following classification. In this context, Senior Counsel for the first respondent submitted that the existence of a dwelling innocently constructed within the separation distance after classification would be taken into account at the merits assessment stage.

It is uncontroversial and unsurprising that existing sensitive uses receive a higher level of protection under the Code than future or potential sensitive uses. However, the first respondent’s submission begs the question: is the higher level of protection afforded to sensitive uses that exist at the time of the permit decision or only to those that exist at the earlier point of classification? Again, I see no warrant, having regard to the text or context of the Code, for freezing in time the facts relevant to the classification process.

Furthermore, the argument that sensitive uses that come into existence after classification but before the permit decision is made are afforded protection in the merits assessment process following classification is questionable. This argument presumes that the Code provides for a separate and full assessment of the merits of the proposal following classification. In fact, the Code does not.

The scope of the merits assessment in the Code is constrained by the regime of objectives, standards and approved measures in Section 7. Where the development proposal adopts all the approved measures for a standard, the application is deemed to comply with the standard and with the objective. This limits the decision-maker’s inquiry into the merits of the proposal.

This limitation can be illustrated by considering how the impact of the proposed broiler farms on the new dwellings on the Forbes and Smith land must be assessed under Section 7.

Element 1 has the objective of ensuring that the location and size of the proposed broiler farm minimises the risk of adverse amenity impacts on nearby existing, planned or potential sensitive uses as a result of odour, dust and noise. Standard S1, the standard for amenity protection, reflects this objective. There are seven approved measures,[69] which, if complied with, will result in both Standard S1 and the objective for Element 1 being met. So far as the assessment of the impact of the proposal on the new houses on the Forbes and Smith land is concerned, the approved measures, and thereby Standard S1 and the objective of Element 1, will be complied with if:

(a) any temporary litter stockpile or compost pile is set back at least 300 metres from the dwelling (approved measure E1 M1.4);

(b) any litter spreading area is set back at least 100 metres from the dwelling (approved measure E1 M1.7).

[69]Code, 26–27 (E1 M1.1–E1 M1.7).

Approved measure E1 M1.3, which provides for separation distances to be increased in light of ‘site specific circumstances’ in the form of prevailing meteorological conditions and topographical features, has no bearing on the assessment of the impact on the houses on the Forbes and Smith land as they are already within the prescribed separation distance and an increase would make no difference. Approved measures, E1 M1.1, E1 M1.2, E1 M1.4, and E1 M1.6 are not relevant to the impact of the proposal on the houses.

It is therefore possible to satisfy the approved measures for Standard S1 without assessing the impact of dust, noise or odour from the broiler sheds on existing sensitive uses. However, the Code itself states that the farm design and operation elements apply ‘in addition to’ the separation distance requirements used to determine farm classification that are found in Section 5. Separation distances must play a role throughout the permit assessment process in order to protect local amenity in relation to such matters as dust, noise and odour.

The result of freezing the facts relevant to classification at the point in time at which the permit application is lodged is that sensitive uses that have come into existence after classification but before the permit decision is made effectively lose the protection of the Code. So much is apparent from the way in which the Tribunal itself dealt with the houses on the Forbes and Smith land, which was to ignore them.

The language of the Code also supports there being a continuous process and a single timeframe for classification and merits assessment rather than the disjunction between classification and the rest of the measures in the Code upon which the argument of the first respondent depends.

The word ‘existing’ in relation to sensitive uses appears throughout the Code. Section 4, for example, refers to the provision of separation distances between the broiler shed and ‘existing or potential sensitive uses’ and describes separation distances as providing ‘sufficient space to minimise the risk of offensive odour and dust emissions under both routine and abnormal (or upset) conditions adversely impacting the amenity of existing sensitive uses’; Section 6 refers to the amenity of ‘existing sensitive uses’ beyond the broiler farm boundary in relation to the preparation of the Odour ERA; the objective of Element 1 in Section 7 refers to minimising the risk of adverse amenity impacts on nearby ‘existing, planned and potential further sensitive uses’.

On the construction advanced by the first respondent, an ‘existing’ sensitive use in the context of Section 7 would not necessarily be a use that was an ‘existing’ sensitive use for the purposes of classification in Section 5. If ‘existing’ is read as limited to ‘existing at the time of classification’, the dwellings on the Forbes and Smith land would not be ‘existing’, but nor could they properly be described as ‘future’ or ‘potential’ uses. Sensitive uses are to be factored into the approval process as existing, future or potential sensitive uses. Consideration of future and potential sensitive uses involves a predictive exercise as to what is likely to arise in the future. The first respondent’s construction strains the meaning of the words ‘future’ and ‘potential’. Given the intention that the Code cover all three kinds of sensitive use, as a matter of ordinary language, a sensitive use in existence at the time of the permit decision is plainly an ‘existing use’.

Furthermore, to construe the Code as requiring consideration of one set of facts for the determination of farm classification and (at least, potentially) a different set of facts for the assessment of the proposal, is to provide for process to override substance. It would, as in the current case, require the responsible authority (or the Tribunal on review) to ignore the existence of sensitive uses within the separation distance (such as the houses on the Forbes and Smith land) despite the fact that the sensitive uses could be adversely affected by odour and dust from the proposed broiler farm. Conversely, if there was an existing dwelling within the separation distance when the permit application was lodged but it was demolished before the proposal was considered by the responsible authority, the permit applicant would be denied the benefit of a reclassification for the purposes of the assessment and permit decision. In either event, the process would proceed on an artificial and potentially unfair basis. This would not achieve any of the four purposes of the Code identified in Section 1, namely, to deliver sound environmental performance, to protect local amenity and the surrounding environment and to deliver an economically viable, competitive and sustainable broiler farm industry.

I have therefore concluded that the application of one form of planning control — the imposition of separation distances — by reference to one set of facts and the application of the remaining controls by reference to a different set of facts is not consistent with the Code and does not achieve fairness and a reasonable balance between the respective interests of all concerned. The language, structure and purpose of the Code requires classification to take place on the same factual basis as the assessment of the proposal. This construction is both consonant with the Code’s language (‘existing’) and its purpose (that all sensitive uses are to be considered on the basis of the best available information).

I accept that the permit applicant may suffer considerable inconvenience if farm classification has to be reviewed because of facts that come into existence after the permit application has been prepared and lodged. It may be necessary for the permit applicant to restart the permit application process from scratch due to factors entirely beyond the permit applicant’s control. The practical difficulties and potential unfairness to the permit applicant identified by the court below are real. However, I observe that separation distances are used as a planning tool to regulate a variety of other uses and developments and, in the absence of clear language to the contrary, permit applications for such uses are assessed, in accordance with the usual practice, on the facts that exist at the time of the permit decision. Urban development, in particular, is dynamic. Relevant circumstances may change between the time a permit application is lodged and the time of the final permit decision, especially when the right to review by the Tribunal is exercised. Plans for a development may have to be rethought after the permit application has been completed. This is an accepted part of planning law and practice in Victoria.

For the reasons I have stated, the Code does not contemplate a departure from the usual practice that the responsible authority and, on review, the Tribunal, will decide a planning permit application on the basis of the facts and circumstances in existence at the time of its decision. The Code treats separation distances as part of an integrated package with the other measures protecting amenity, and thereby strikes what the framers of the Code considered to be an appropriate balance between the interests of neighbouring landowners and the interests of the broiler farm industry.

The judge at first instance was concerned to construe the Code so as to prevent objectors obtaining an unmeritorious tactical advantage by taking steps — such as erecting a dwelling — for the purpose of stymying a development proposal. In the Tribunal, the first respondent submitted that the houses on the Forbes and Smith land were a ‘sham’ in that they erected for the purpose of preventing the approval of the proposed broiler farms. Because of the way in which it construed the Code, the Tribunal found it unnecessary to determine this question. For the purpose of this appeal, the questions of law have been decided on the basis that the erection of the houses on the Forbes and Smith land was not a sham and that they are sensitive uses according to the definition in the Code. On a remittal to the Tribunal, however, the question will be whether there is a sensitive use in fact within any separation distance and the permit applicant will be free to make such arguments as it may be advised, including that the structures are not sensitive uses or involve a sham.

Ground 1 is made out. It is not the case that the classification of a proposed broiler farm under the Code takes place at the time of the application for permission under the PE Act to use or develop land for the purpose of a broiler farm. The Code does not require the classification of the proposed broiler farm to be undertaken by reference to the facts and circumstances existing at the date the application for a permit is lodged.

Ground 2

Ground 2 is raised in the alternative to Ground 1. By Ground 2, the applicants for leave contend that the judge at first instance erred in holding that, when an application for permission under the PE Act to use or develop the land for the purpose of a broiler farm is amended under s 127 and/or cl 64 of part 16 of Schedule 1 to the VCAT Act, the classification of a proposed broiler farm under the Code does not take place at the time of the amendment.

Ground 2 assumes that the facts and circumstances to be considered to determine farm classification are those existing on the date the permit application is lodged, except where the application is amended by the substitution of plans. This conflicts with the proper construction of the Code identified in Ground 1. However, in case I am wrong about the construction of the Code, I will examine the argument assuming the (false) premise to be correct.

The applicants submit that if an application for planning permission for a broiler farm is amended, the process of classification may have to be recommenced. In the present case, because of the reorientation of the sheds in the amended plans, the separation distances will affect different land, including different parts and proportions of the neighbouring land. The classifications of the proposed broiler farms therefore require reconsideration. The process of classification must start again and be undertaken on the basis of the facts in existence at the time of that exercise. This includes changes in circumstances that have occurred other than only by reason of the amendment of the plans and includes, in this case, the erection of the new dwellings.

This analysis seems to me to be correct, accepting for the sake of argument the false premise about the ‘once and for all’ nature of the classification process. Indeed, the judge at first instance agreed with this analysis to the following extent:[70]

In the event that a permit applicant amends an application so as to affect the classification of a proposed broiler farm, the relevant date for the determination of the classification of the proposed broiler farm, and the separation distance, will be the date of the amended application.

[70][2017] VSC 20 [142].

However, the judge did not find it necessary to reach a conclusion as to whether, in this case, the amended plans affected the classifications of the proposed boiler farms.

Were it necessary to decide, and assuming (contrary to what I have held to be the proper construction of the Code) that the relevant facts for determining farm classification are those in existence at the time the permit applicant lodges the permit application, I would hold that the classification process was reopened by the amendment and that it was therefore necessary to consider the classification by reference to the facts in existence at the time of the amendment.

Ground 3

Ground 3 is that the judge at first instance erred in holding that the presence of recently constructed houses on the Forbes and Smith land were not to be taken into account in assessing separation distances from sensitive uses for each of the three proposed 400,000 bird broiler farms.

Ground 3 is made out. In classifying and assessing the proposed broiler farms, the Tribunal was required to consider the facts in existence as at the date of its decision, including the existence of any new dwellings within the separation distances.

Ground 4

Ground 4 is that the judge at first instance erred in holding that the word ‘property’ as used in approved measures E1 M5.1 and E1 M5.2 in Section 7 of the Code meant ‘rural land holding’.

Approved measures E1 M5.1 and E1 M5.2 (‘E1 M5.1’ and ‘E1 M5.2’ respectively) relate to Standard E1 S5 for the future use and development of neighbouring land. Standard S5 is as follows:

Broiler sheds are sited so that offensive odour, dust and noise emissions will not adversely impact the orderly and sustainable use and development of land located beyond the farm property boundary, including the ability to establish a dwelling … on vacant property, having regard to:
·the existing and likely future use and development of the land including any approved sensitive uses
·the existing physical and environmental characteristics of the land
·the purpose and requirements of the zone applying to the land
·any applicable land use decision guidelines, policies and strategies in the planning scheme.

E1 M5.1 provides:

Class B Farms — The required minimum separation distance covers no more than 50 per cent of the area of a property located beyond the broiler farm property boundary.

E1 M5.2 provides:

Class B Farms — Where a property located beyond the broiler farm property boundary is not currently developed with a dwelling …the remaining area of the property (unaffected by the separation distance requirement) is capable of providing a 20 metre x 30 metre building envelope for a dwelling taking into account the following siting considerations:
·   any applicable planning scheme requirements including zoning considerations and any setback requirements for buildings not requiring a planning permit under the applicable zoning provisions
·   whether the land is encumbered by steep terrain, native vegetation, offsite impacts of an existing intensive animal industry or any other significant topographic, environmental or land use characteristic that may significantly limit the ability to establish and use a dwelling
·   whether the land is identified in the planning scheme as being subject or susceptible to flooding (both river and coastal inundation), landslip or any other form of hazard that may limit the ability to establish and use a dwelling.

However, the remaining land does not need to be capable of providing a building envelope if the land covered by the minimum separation distance requirement is equally unacceptable in terms of providing the building envelope having regard to the siting considerations listed above.

E1 M5.1 refers to 50 per cent of ‘the area’ of a property, which leaves no doubt that when the Code refers to ‘property’ in E1 M5.1 and E1 M5.2, it is a reference to land. The question is whether the land is restricted to a lot or whether it means a larger land holding.

The applicants for leave to appeal contend that the Court erred in holding that the word ‘property’ in E1 M5.1 and E1 M5.2 means ‘rural land holding’. They submit that ‘property’ in this context means ‘lot’. This makes it harder to satisfy E1 M5.1 and E1 M5.2 in many circumstances, where a lot will be a smaller area than a farm or ‘landholding’.

The applicants submit that the purpose of E1 M5.1 and E1 M5.2 is to ensure that neighbouring landowners still have a fair opportunity to develop their land with a dwelling despite the development and use of a Class B broiler farm on neighbouring land. That, so they contend, brings into play the technique used more generally in the Scheme to regulate the construction of dwellings in rural areas, which is by reference to lots and lot size. The applicants submit that reference to ‘lots’ provides certainty, because land that is less than a lot cannot be sold without subdivision, whereas what might be an aggregated holding can change simply by a sale or another purchase at any time.

In this regard, the applicants compare and contrast the certainty associated with identifying a lot with the uncertainty associated with identifying a ‘holding’, (that is, a number of lots owned by one person) or an ‘aggregated holding’ (a number of lots owned by a person or persons associated with that person). They point out that farms are commonly aggregated holdings in that different lots will be held by different entities. Moreover, in a holding or aggregated holding, the lots may or may not be contiguous. Of the alternative meanings of ‘property’ thus identified, the applicants submit that only one possibility provides a convincing answer, and that is a lot, because it is the only one which provides a certain answer.

In my view, the judge at first instance was correct to hold that the word ‘property’ is not used in the Code in any formal or technical way, but simply in the sense of a rural farm property or landholding.

The word ‘lot’ is not used in the Code. Its absence from E1 M5.1 and E1 M5.2 must be seen to be a deliberate choice by the framers of the Code, who must be taken to have understood that the Rural Zone provisions in the Scheme contain certain entitlements for dwellings on lots. In describing what might be developed in the future, the Code could have adopted the approach that entitlements to develop particular adjoining land would be regulated by reference to subdivision or the construction of dwellings based on lots and lot sizes. However, the framers of the Code used the word ‘property’ rather than ‘lot’ in E1 M5.1 and E1 M5.2. Accordingly, ‘property’ must be understood according to its ordinary meaning in a rural context as a broad landholding. This is so, despite potential uncertainty about where a rural landholding begins and ends.

The Code seeks to achieve a balance between the interests of broiler farm developers and adjoining owners, and in so doing, requires the broiler farm operator to provide a substantial separation distance and to take into account ‘the orderly and sustainable use and development of land located beyond the farm’. The Code could have struck this balance by assuming that every lot of 40 hectares or more could be the subject of an ‘as of right’ dwelling, and require merits assessment to be undertaken of the orderly and sustainable use and development of land having regard to that potentiality. However, it did not.

The meaning of ‘property’ as a landholding is consistent with the purpose of E1 M5.1 and E1 M5.2, which is to facilitate the development of neighbouring properties while striking the balance referred to in the previous paragraph. Providing that no neighbouring lot was to be covered to the extent of more than 50 per cent by the minimum separation distance would not achieve this balance. Lots come in different shapes and sizes. The smaller the lot, the more likely it is to be affected to the extent of more than 50 per cent of its area. The lot intruded upon by the separation distance might be unable to accommodate a dwelling in any event because it does not meet the minimum size or because of particular topographical or geographical features. In the case of a landholding comprised of a number lots, a separation distance might intrude to a significant extent on a particular lot but only to a small and relatively insignificant extent on the farm property as a whole. The separation distance would not impede the development of a dwelling on the property taken as a whole. This appears to be the case for the Smith landholding, for example. An effective prohibition arising from a 50 percent intrusion on any lot of any size would be arbitrary and would impose a greater restriction than was necessary to achieve the purpose of the approved measures in question.

Finally, E1 M5.1 and E1 M5.2 both use the word ‘property’ in relation to a broiler farm in the context of there being a ‘broiler farm property boundary’. ‘Property’ in that context is not necessarily limited to a lot. The definition of a ‘broiler farm’ in the Code is ‘[l]and used to keep broiler chickens that are housed permanently in sheds and reared for meat production’.[71] It is not limited to a lot. The insertion of the word ‘lot’ in lieu of ‘property’ in the expression ‘broiler farm property boundary’ does not sit well with the definition of ‘broiler farm’ and it would be nonsensical to refer to neighbouring properties as being located beyond individual lot boundaries on the broiler farm.
[71]Code, 59.

Ground 4 is not made out.

Disposition

For the above reasons, I would grant leave to appeal with respect to proposed Grounds 1 and 3 and refuse leave with respect to proposed Ground 4. It is unnecessary to consider the application for leave to appeal on proposed Ground 2.

Grounds 1 and 3 have been made out. The errors are vitiating errors. However they concern only the Tribunal’s orders in respect of Farms 1 and 2. There is no new dwelling near proposed Farm 3.

Accordingly, the orders of the Tribunal concerning Farms 1 and 2 should be set aside and the proceeding remitted to the Tribunal in respect of the permit applications for Farms 1 and 2, to be determined according to law.

- - -

SCHEDULE OF PARTIES

MAURICE FORBES	First Applicant
BARRY FORBES	Second Applicant
PETER LISTON	Third Applicant
PAULINE LISTON	Fourth Applicant
PETER SMITH	Fifth Applicant
-and-
MICHAEL VUKADINOVIC	First Respondent
MOUNT ALEXANDER SHIRE COUNCIL	Second Respondent
-and-
MARK YARWOOD, MARK BRASSER, KIM BRASSER, RAIMOND GAITA, YALE GAITA, IAN ADDLEM, JASON KEATS, BRENDON CONNELLY, SHELLEY WALKER, JOE LA GRECA, SUE LA GRECA, GRANT HODGETTS, CATHY MCCALLUM, TOBY LISTON, SARAH LISTON, PETER BAKER, SHANE BAKER, MAREE BAKER, AMBER BAKER, LOUISE APPLEBY, ROB WILSON, JAROD ADLEM, KERRY ADLEM, RON SHELLIE, HEATHER SHELLIE, ROY PICKERING, LIND PICKERING, LYNDSAY DANIEL, ABBY DANIEL, ALAN MILLAR AND NOEL BRASSER	Third to Thirty-Third Respondents
-and-
J PURCELL	Thirty-Fourth Respondent

[2018] VSCA 138

5 June 2018