Smith v Gould
[2012] VSC 542
•14 November 2012
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
VALUATION COMPENSATION AND PLANNING LIST
S CI 2011 02034
S CI 2011 4315
| MILDURA RURAL CITY COUNCIL | Appellant |
| v | |
| VABDS DEVELOPMENTS PTY LTD | Respondent |
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JUDGE: | KYROU J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 29 October 2012 | |
DATE OF JUDGMENT: | 14 November 2012 | |
CASE MAY BE CITED AS: | Mildura Rural City Council v VABDS Developments Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2012] VSC 542 | |
JUDGMENT APPEALED FROM: | VABDS Developments Pty Ltd v Mildura Rural City Council [2011] VCAT 556 (1 April 2011) (Member Code) | |
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ADMINISTRATIVE LAW – Appeal from decisions of the Victorian Civil and Administrative Tribunal – Whether the VCAT misconstrued the principles governing the exercise of discretion to extend a planning permit – Planning and Environment Act 1987, s 69(2) – Kantor v Murrindindi Shire Council (1997) 18 AATR 285 considered.
PRACTICE AND PROCEDURE – Application to amend a notice of appeal to add a further ground of appeal – Supreme Court (Miscellaneous Civil Proceedings) Rules 2008, r 4.11(3).
COURTS AND JUDGES – Power of Supreme Court to amend an order of the VCAT under the Victorian Civil and Administrative Tribunal Act 1998, s 148(7).
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| APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr R. Appudurai | Russell Kennedy |
| For the Respondent | Mr E. Nekvapil | Norton Rose |
TABLE OF CONTENTS
Introduction and summary.............................................................................................................. 1
Relevant statutory provisions.......................................................................................................... 2
Facts...................................................................................................................................................... 4
Principles in Kantor v Murrindindi Shire Council....................................................................... 8
VCAT’s decisions............................................................................................................................... 9
Did the VCAT misconstrue the principles in Kantor v Murrindindi Shire Council?.......... 13
Ruling on the Council’s application to amend the notice of appeal..................................... 17
Factual background.................................................................................................................... 18
The VCAT’s decision.................................................................................................................. 19
Parties’ submissions.................................................................................................................... 20
Reasons for ruling....................................................................................................................... 22
Proposed orders................................................................................................................................ 24
HIS HONOUR:
Introduction and summary
These reasons concern two appeals from decisions of the Victorian Civil and Administrative Tribunal (‘VCAT’) relating to two parcels of land in Karadoc Avenue, Irymple (‘Two Parcels’) that are owned by the respondent, VABDS Developments Pty Ltd (‘VABDS’). The VCAT set aside decisions of the appellant, the Mildura Rural City Council (‘Council’), to refuse to extend planning permits that it had previously granted for the subdivision of the Two Parcels. The VCAT also ordered that the plan of subdivision affecting one of the Two Parcels be certified.[1]
[1]The VCAT delivered one set of reasons for four separate applications for review that VABDS commenced against the Council. See VABDS Developments Pty Ltd v Mildura Rural City Council [2011] VCAT 556 (1 April 2011) (‘Reasons’).
The permits, when granted by the Council in 2005, were each subject to a condition that VABDS enter into a formal agreement with the First Mildura Irrigation Trust (‘Trust’) in relation to drainage infrastructure. This condition was not satisfied at the time the permits expired.
Prior to the hearing before the VCAT, the Council established its own drainage infrastructure for the area that included the Two Parcels and, following the commencement of Development Contributions Plan Overlay Schedule 2 (‘DCPO2’), Development Contributions Plan No 2 (‘DCP’) was incorporated into the Mildura Planning Scheme (‘Scheme’). Developers who obtained a planning permit after the commencement of DCPO2 were required to pay a development infrastructure levy to the Council for the provision of its infrastructure. Land that was the subject of a planning permit prior to the commencement of DCPO2 and which was extended after that time was exempt from the levy.
For each of the appeals to this Court, the sole ground of appeal is that the VCAT misconstrued the principles in Kantor v Murrindindi Shire Council[2] relating to the exercise of the discretion under s 69(2) of the Planning and Environment Act 1987 (‘P & E Act’) to extend a planning permit.
[2](1997) 18 AATR 285 (‘Kantor’).
For the reasons that follow, I have concluded that the VCAT did not err in law and that the appeals should be dismissed.
Relevant statutory provisions
Sections 46N(1), 69, 81(1) and 84B(1) of the P & E Act provide as follows:
46N Collection of development infrastructure levy
(1) Without limiting section 62, if—
(a)an approved development contributions plan provides that a development infrastructure levy is payable in respect of the development of any land; and
(b)an application is made under this Act for a permit to carry out that development on that land—
the responsible authority must include a condition in the permit that the applicant—
(c)pay the amount of the levy to the relevant collecting agency within a specified time or within a time specified by the collecting agency; or
(d)enter into an agreement with the relevant collecting agency to pay the amount of the levy within a time specified in the agreement.
69 Extension of time
(1)Before the permit expires or within three months afterwards, the owner or the occupier of the land to which it applies may ask the responsible authority for an extension of time.
(2)The responsible authority may extend the time within which the use or development or any stage of it is to be started or the development or any stage of it is to be completed or within which a plan under the Subdivision Act 1988 is to be certified.
(3)If the time is extended after the permit has lapsed the extension operates from the day the permit expired.
81 Appeals relating to extensions of time
(1) Any person affected may apply to the Tribunal for review of—
(a)a decision of the responsible authority refusing to extend the time within which any development or use is to be started or any development completed; or
(aa)a decision of the responsible authority refusing to extend the time within which a plan under the Subdivision Act 1988 is to be certified, in the case of a permit relating to any of the circumstances mentioned in section 6A(2); or
(b)the failure of the responsible authority to extend the time within one month after the request for extension is made.
84B Matters for Tribunal to take into account
(1)In determining an application for review under this Act, the Tribunal must—
(a)take account of any matter which the person or body in respect of whose decision the application for review is made—
(i)properly took account of in making its decision; or
(ii)was required to take account of in making its decision; and
(b)have regard to any matter which the person or body in respect of whose decision the application for review is made—
(i)properly had regard to in making its decision; or
(ii)is required to have regard to in making its decision.
Sections 6(1) and (2) and 40(1)(a) of the Subdivision Act1988 relevantly provide:
6 What must the Council do?
(1) The Council must certify a plan within the prescribed time if—
(a)the plan complies with this Act, the regulations, and those requirements of the planning scheme and any permit that relate to the boundaries of roads, lots, common property and reserves and the form and content of the plan; and
…
(c) every referral authority has given consent;…
…
(2)If the conditions in subsection (1) are not met, the Council must refuse to certify the plan and give its reasons in writing to the applicant within the prescribed time.
40Review of refusal or failure to decide
(1)An applicant may apply to the Victorian Civil and Administrative Tribunal for review of—
(a)a decision of a Council to refuse to—
(i)certify or re-certify a plan; …
Facts
On 1 April 2005, the Council granted a permit to VABDS to subdivide one of the Two Parcels into 14 lots (’14 lot permit’). The 14 lot permit would expire if a plan of subdivision was not certified by 31 March 2007.
Condition 1 of the 14 lot permit provided that, ‘[p]rior to certification, formal agreement between the permit holder and the relevant authority supporting the interim stormwater discharge arrangement is required’. As at 1 April 2005, the relevant authority was the Trust. The 14 lot permit required payment of a 5 per cent public open space contribution in lieu of a reserve.
On 18 May 2005, the Council granted a permit to VABDS to subdivide the other parcel of land into 64 lots (’64 lot permit’).[3] The 64 lot permit would expire if a plan of subdivision was not certified by 17 May 2007.
[3]The 64 lot permit initially provided for 61 lots. It was subsequently amended to provide for 64 lots.
Condition 1 of the 64 lot permit was similar to condition 1 of the 14 lot permit, as set out at [9] above. Conditions 3 and 4 required, among other things, that, before certification of a plan of subdivision, a salinity management plan and road design, streetscape design and drainage design plans be prepared to the Council’s satisfaction. The 64 lot permit also required the setting aside of a 6,125 square metre reserve for drainage and public open space, comprising about 10 per cent of the land in the proposed subdivision.
On 13 September 2005, pursuant to the Subdivision Act, VABDS applied to the Council to certify a plan of subdivision to create 14 lots (’14 lot plan of subdivision’). The Council failed to decide the application.
On 1 April 2007, the 14 lot permit expired.
On 3 August 2007, pursuant to s 69(2) of the P & E Act, the Council extended the 64 lot permit to 18 May 2008.[4]
[4]The form of the Council’s decision was to extend to 18 May 2008 the time for certification of a plan of subdivision.
On 15 November 2007, the DCP was incorporated into the Scheme. Clause 4 of the Scheme provides:
Applicants of all development types anywhere in the development contributions plan area must be liable for development contributions, apart from residential development that has obtained a planning permit prior to incorporation of this development contributions plan in the scheme.
On 13 December 2007, a Development Plan (‘DP’) was approved. The DP applies to the Two Parcels. The VCAT’s Reasons stated the following in relation to the DCP and the DP:
28The DP does not operate to prohibit the subdivisions. The DP supports development of both parcels in accordance with the permits, stating it is ‘committed development’.
29The DP refers to drainage issues and to the need for development to provide stormwater management areas to connect to existing infrastructure when drainage upgrades are completed, and that funding for those upgrades will be supported by development contributions. The DP specifically refers to the need for a small retarding basin partly on the 64 lot parcel (and partly on other adjoining land to the north) and a larger basin nearby on the south-west side of Fifteenth Street.
30The DP provides for a detailed subdivision layout of the 64 lot parcel. The Council subsequently amended the 64 lot permit to authorise a modified road and lot layout. The 14 lot permit is, and the 64 lot permit remains, generally in accordance with the DP, as required by DPO1. The subdivisions will now be drained in accordance with infrastructure referred to in the DP (including the retarding basin on [VABDS’] land), even though that is not the arrangement envisaged under the permits.
31 In short, the DP is no basis for refusing extension of the permits.
…
32For residential development of both parcels, the DCP sets (as at 1 July 2009) contributions for development infrastructure of $8,729 per dwelling, comprising contributions for roads, drainage, open space, educational facilities and bicycle paths. Drainage and open space comprise about 60% and 30%, respectively, of this amount. The DCP also requires contributions for community infrastructure of $1,053 per dwelling.
33If those contributions were payable for residential development of both parcels, about $627,000 and $137,000 would have to be paid for the [64] lot permit and the [14] lot permit, respectively.[5]
[5]Reasons, [28]-[33].
On 20 December 2007, pursuant to the Subdivision Act, VABDS applied to the Council to certify a plan of a stage of the 64 lot subdivision (‘plan of a stage of the 64 lot subdivision’). The Council failed to decide the application.
On 18 May 2008, the 64 lot permit expired, as a plan of subdivision had not been certified.
On 28 July 2008, within 3 months after the expiry of the 64 lot permit, VABDS applied to the Council to further extend that permit.
On 19 August 2008, the Trust was wound up and its functions were transferred to Lower Murray Water.
By letter dated 14 November 2008, the Council refused to extend the 64 lot permit. The letter relevantly stated:
Since the permit was issued on 18 May 2005, there have been several changes to the planning scheme that affect the land subject to this application. The most significant change is that the land is now subject to the Development Contributions Plan Overlay – Schedule 2 pursuant to Clause 45.06 of the Mildura Planning Scheme.
As the subject site is affected by this overlay the proposed subdivision attracts development contribution fees. Council is not willing to grant the requested extension of time without acquiring the required development contribution fees. Conditions relating to these contributions cannot be included on any amended permit pursuant to Section 69 of the Planning and Environment Act 1987.
On 13 December 2010, nearly four years after the 14 lot permit expired on 1 April 2007, VABDS applied to the Council to extend that permit. The Council decided that it did not have the power to extend the time under s 69(2) of the P & E Act.
Pursuant to s 81(1) of the P &E Act, VABDS filed the following applications for review with the VCAT:
(a) Application P1499/2009 seeking an order extending the 64 lot permit.
(b) Application P3674/2010 seeking an order extending the 14 lot permit.
Pursuant to s 40(1)(a) of the Subdivision Act, VABDS filed the following applications for review with the VCAT:
(a) Application P1511/2009 seeking an order for the certification of the plan of a stage of the 64 lot subdivision.
(b) Application P1524/2009 seeking an order for the certification of the 14 lot plan of subdivision.
The VCAT heard the above applications together. On 1 April 2011, the VCAT published one set of Reasons for the following decisions:
(a) In application P1499/2009, it made an order extending the 64 lot permit to 18 May 2012.
(b) In application P1511/2009, it decided not to make an order certifying the plan of a stage of the 64 lot subdivision.
(c) In application P1524/2009, it made an order certifying the 14 lot plan of subdivision.
(d) In application P3674/2010, it made an order extending the 14 lot permit until 18 May 2012.
The VCAT’s decision in relation to application P1499/2009 is the subject of appeal 4315/2011 to this Court. The VCAT’s decision in relation to application P1524/2009 and application P3674/2010 are the subject of appeal 2034/2011 to this Court. There is no appeal against the VCAT’s decision in relation to application P1511/2009.
Principles in Kantor v Murrindindi Shire Council
As the sole ground of appeal is whether the VCAT misconstrued the principles in Kantor relating to the exercise of the discretion to extend a planning permit, the relevant paragraphs of Ashley J’s judgment in that case are set out below:
[M]y task is to ascertain from the subject-matter, scope and purpose of the [P & E] Act matters which might, in particular circumstances, be relevant to consideration of a request to extend time … [I]t is not my task to identify each matter which could conceivably be relevant to consideration of a request to extend time – that is, in a case other than the present.
…
[I]t [is] understandable why there should be provision for expiry of permits … Grant of a permit for use or development which had no expiry date would unnecessarily open up the prospect of delayed use or development at odds with changed planning policy …
I consider that where a request to extend time is made, a responsible authority –
·should treat the applicant as being obliged to advance some reason or material in support of the grant of an extension … [T]he exercise of the discretion to extend reverses the outcome which the permit or the legislation would otherwise require.
·may rightly consider –
oas a factor in favour of an exercise of discretion under [s 69(2)] (if it be the case) that there has been no change in planning policy (in which term I include relevant legislation and the planning scheme). Consideration of that matter shows, indirectly, concern for any persons who objected to the grant of the permit at the outset; or who would, if fresh application for a permit was being made, be potential objectors. On the other hand, it does not follow that, absent a change in planning policy, an extension should normally be granted.
oas a factor tending against the grant of an extension, any material which suggests that the owner of land is seeking to ‘warehouse’ a permit. …
ointervening circumstances as bearing upon grant or refusal of an extension. …
othe total elapse of time when a request to extend is being considered. …
oas a corollary of the previous matter, whether the time limit for use or development originally imposed (and, if it be the case, as thereafter extended) was adequate in all the circumstances. …
…
othe probability, if it be the case, that if a request to extend time was refused and a fresh application for a permit was then made, it would be granted. Such a conclusion might perhaps be reached if planning policy remained unchanged; and if it seemed improbable that – if a fresh application was made – any new considerations would be raised by potential objectors.
Consideration whether a responsible authority failed properly to exercise its discretion under s 69(2) undoubtedly requires the closest attention to the facts of the particular case. I again emphasize that matter in case it be thought that the abovementioned considerations were an attempt by me to exhaustively state all the matters and the only matters which a responsible authority might properly consider to be relevant on any request for extension.[6]
[6]Kantor (1997) 18 AATR 285, 309, 313-14.
VCAT’s decisions
The VCAT held that it had power under cl 62 of sch 1 to the Victorian Civil and Administrative Tribunal Act 1998 (‘VCAT Act’) to extend the time for the certification of the 14 lot plan of subdivision, notwithstanding that the application for extension was made over three months after the 14 lot permit had expired. The Council initially appealed to this Court from the VCAT’s finding but subsequently abandoned that part of its appeal in the light of the Court of Appeal’s decision in Harvey v Mutsaers.[7]
[7][2012] VSCA 69 (19 April 2012).
On the question of whether time should be extended, the VCAT stated that ‘[i]t is a matter for the Tribunal’s discretion as to whether the permits are extended under s 81(1) of the [P & E] Act’.[8] In support of this proposition, the VCAT cited, without quoting, para 5 of Morris P’s decision in Minawood Pty Ltd v Bayside City Council.[9] In that paragraph, Morris P stated:
A decision to extend the time within which development must start (or be completed) is discretionary. Hence any articulation of factors which might guide the exercise of that discretion should be seen as guidelines, rather than definitive requirements: compare Kantor v Murrindindi Shire Council. Nevertheless, in the context of the present case, the two main considerations which stand out are:
•whether the permit holder has an acceptable reason for seeking an extension of the time within which the development must start; and
•whether there have been any changes to planning provisions or planning policy since the grant of the permit which are likely to make the development no longer acceptable.[10]
[8]Reasons, [12].
[9][2006] VCAT 2097 (11 October 2006) (‘Minawood’).
[10]Minawood [2006] VCAT 2097 (11 October 2006) [5] (citation omitted).
The VCAT then stated that ‘[t]he principles for the exercise of [the] discretion [whether to extend a planning permit] are set out in Kantor v Murrindindi Shire Council’.[11]
[11]Reasons, [12] (citation omitted).
The VCAT used the principles in Kantor that are outlined at [27] above as a framework for deciding how to exercise the discretion in the present case. In relation to the effect of a change in policy, the VCAT stated:
23 The Council relies on the following changes—
•The commencement of DCPO2 on 15 November 2007 and the incorporation of Development Contributions Plan No 2 (the DCP) into the scheme on this date. DCPO2 applies to both parcels.
•The approval of a development plan (the DP) under DPO1 on 13 December 2007. The DP applies to both parcels.
24 I accept that both changes are potentially relevant changes.
25Both changes occurred after the two permits were granted. The 14 lot permit expired before both changes and the 64 lot permit expired after both changes.
…
34I heard extensive argument about—
•The intention and effect of DCPO2 and the DCP.
•The nexus between the subdivisions and the contribution items.
•Whether the contributions could be lawfully levied when the permits were granted.
•The effect of s 46N of the [P & E] Act.
•The effect of amendment to the 64 lot permit, shortly before commencement of DCPO2.
•Whether the payment of contributions in respect of both permits would now amount to ‘double dipping’.
35I have decided that DCPO2 is not a relevant change of policy having regard to its terms. Clause 4.0 of DCPO2 provides—
Land or development excluded from Development Contributions Plan
Applicants of all development types anywhere in the development contributions plan area must be liable for development contributions, apart from residential development that has obtained a planning permit prior to incorporation of this development contributions plan in the scheme.
36The subdivisions allowed by both permits are ‘residential development’. Both permits were granted or ‘obtained’ before 15 November 2007 when the DCP was incorporated into the scheme.
37It was submitted on behalf of the Council that clause 4.0 does not apply to the permits because both permits have expired. Although they have expired, if the Tribunal grants extensions, they will remain in force. The Council’s submission effectively denies the application of the exemption if a review of a decision to refuse an extension is not finalised before expiry of the permit. The express words of the clause do not admit of this construction.
38The DCP does not refer to this being the intention of the clause. In fact, the DCP appears to have been drafted with the contrary intention. The DCP is dated 9 October 2006. On that date, the two permits were in force. The drafters of the DCP were then on notice that no contributions would be obtained for residential development of the two parcels (and any other residential development for which permits had been granted). The drafters must have fixed the contributions having regard to what permits qualified for the exemptions.
39As well, and on policy grounds, I would not construe the clause as submitted by the Council because it could allow the Council to conduct litigation in such a way to defeat the exemption.
40I therefore construe the clause so that the exemption extends to relevant permits that have been lawfully extended.[12]
[12]Reasons, [23]-[25], [34]-[40] (citations omitted).
In relation to the likelihood of fresh permits being granted, the VCAT stated:
46Despite the changes of policy relied on by the Council, the Council concedes that fresh permits would be granted if new applications were made. The permits would be different, not in the sense of the layout of the road, lots and joint drainage basin and public open space reserve, but in the sense of omitting the conditions relating to the interim drainage arrangement and inserting a condition requiring payment of development contributions in accordance with DCPO2.[13]
[13]Reasons, [46].
The VCAT also discussed the effect of the time that had elapsed since the permits were granted, the adequacy of the time for which provision was made in the permits, and the other principles in Kantor. As the Council has not complained about those aspects of the VCAT’s decisions, I will not set them out. The VCAT stated that, ‘[a]pplying the principles in Kantor, I would exercise [the] discretion to grant extensions to both permits’.[14]
[14]Reasons, [49].
The VCAT made the following concluding comments:
67The plans of subdivision cannot now be certified unless and until the permits are extended. The Council has refused to extend the permits because it wants [VABDS] to first pay the contributions required under DCPO2.
68The Council knew drainage infrastructure was inadequate when both permit applications were made. Instead of refusing the applications on that basis, it encouraged [VABDS] to consult the Trust about a five year interim solution using Trust infrastructure until the Council’s anticipated drainage infrastructure upgrade was complete. After the interim period, the Council expected [VABDS] to connect to the Council’s upgraded infrastructure. The Council then granted the permits to facilitate the interim arrangement.
69When the Council encouraged [VABDS] to consult the Trust, the Council was preparing the DCP. When the DCP was incorporated into the scheme, the subdivisions were exempt from contributions.
70Having designed the subdivisions around the interim arrangement and getting ready to proceed, [VABDS] had to apply to extend the permits. [VABDS] cannot now proceed with the interim arrangement and it must now use the Council’s upgraded infrastructure.
71Applying the relevant law, and balancing the relevant considerations, the permits should be extended.
72Nonetheless, I have some sympathy for the position in which the Council finds itself. The Council did not promptly refuse the two permits years ago on the grounds there was inadequate drainage infrastructure or the development was premature. Instead, possibly for reasons of wanting to assist [VABDS] or to encourage residential development at Irymple, it encouraged [VABDS] to consult the Trust and find an interim drainage arrangement.
73At the same time, the Council was preparing the DCP with the intention that developers would contribute to the cost of the drainage works the Council had decided to construct (and of other infrastructure), except for those developments for which a permit had already been obtained.
74If it could unwind the clock, I would not be surprised if the Council would have decided to refuse the permits until the drainage upgrade was complete or the DCP was approved. The Council’s decision to refuse a permit to subdivide other land in Irymple for ‘out of sequence’ reasons and to oppose a similar Trust interim drainage arrangement, even after the commencement of DCPO2, was upheld in Roy Costa & Associates v Mildura Rural CC.[15]
[15]Reasons, [67]-[74] (citation omitted).
Did the VCAT misconstrue the principles in Kantor v Murrindindi Shire Council?
The sole ground of appeal that is common to both appeals is as follows:
The Tribunal erred in law in that, having decided to apply the principles in … [Kantor] when exercising its discretion under s 69(2) of the P & E Act, it failed to take into consideration the change in planning policy effected by the introduction of DCPO2 and the fact that, … if a fresh application for a permit were made by [VABDS], a condition requiring the payment of a contributions levy under DCPO2 would or might be required to be included in the permit by reason of s 46N of the P & E Act.
The Council submitted that the VCAT misconstrued and consequently failed to apply two of the matters stated by Ashley J in Kantor to be relevant to the exercise of the discretion under s 69(2) of the P & E Act, namely, the effect of a change in policy and whether an application for a fresh permit would have been granted.
In relation to the effect of a change in policy, the Council submitted that Kantor required the VCAT to take into account the fact that an extension of the permit would enable VABDS to avoid payment of a development infrastructure levy under current policy and legislative arrangements, in deciding whether it was appropriate to grant the extensions. According to the Council, by relying on the exemption from the levy to decide that DCPO2 was ‘not a relevant change of policy having regard to its terms’,[16] the VCAT effectively ignored a matter that Kantor stated had to be taken into account.
[16]Reasons, [35].
In relation to the question of whether a fresh application would have been granted, the Council submitted that, although the VCAT correctly stated that a fresh application would have been granted, it failed to take into account that a new permit would have been subject to a condition for the payment of a development infrastructure levy.
VABDS submitted that a fair reading of the VCAT’s Reasons indicates that the VCAT was aware of all the matters set out in Kantor and took them into account in reaching its decisions. VABDS emphasised that the matters set out in Kantor were not mandatory considerations, but merely guidelines that may be taken into account in appropriate cases. The Council’s real complaint, so it was said, was not that the VCAT did not apply the matters set out in Kantor, but that it applied them in a way that resulted in unfavourable decisions for the Council. According to VABDS, the Council’s purported ground of appeal was a misguided attempt to seek a review of the VCAT’s decisions on their merits.
In considering whether the VCAT’s reasons for a decision disclose an error of law, the Court does not scrutinise those reasons over-zealously with a view to finding error.[17] Reasons for decision have to be read fairly and particular parts have to be read in the context of the reasons as a whole and the manner in which the parties conducted the proceeding.[18] In reviewing the VCAT’s reasons for decision, the Court can have regard not only to what the VCAT expressly stated but also to the inferences that necessarily arise from what it expressly stated.[19]
[17]Minister for Immigration and Ethnic Affairs v Liang (1996) 185 CLR 259, 271-2; Paul & Paul [2010] VSC 460 (15 October 2010) [69].
[18]ACN 005 565 926 Pty Ltd v Snibson [2012] VSCA 31 (29 February 2012) [81] (‘Snibson’).
[19]Snibson [2012] VSCA 31 (29 February 2012) [81].
Applying the above principles, I am of the opinion that the Council has failed to make out its ground of appeal.
The matters that the VCAT was required to take into account in the exercise of the discretion under s 69(2) of the P & E Act are those set out expressly in that Act and those that the subject matter, scope and purpose of that Act indicate are relevant considerations. In Kantor, Ashley J distilled some of the considerations that the subject matter, scope and purpose of the P & E Act indicated were relevant to the case before his Honour. Ashley J expressly stated that the matters he outlined were not exhaustive and may not apply in all cases. His Honour’s use of the expression ‘a responsible authority… may rightly consider’ makes it clear that the matters were to be treated as potentially applicable considerations, rather than a mandatory statutory checklist.
In the present case, in its letter of 14 November 2008, the Council took into account DCPO2 in refusing the application for an extension of the 64 lot permit.[20] Accordingly, s 84B(1) of the P & E Act required the VCAT to take this matter into account independently of Kantor.
[20]See [21] above.
A fair reading of the VCAT’s Reasons indicates that it did take into account the effect of DCPO2 as a relevant change in policy. At paras 23 to 24 of its Reasons, the VCAT stated that the incorporation of the DCP into the Scheme and the approval of the DP ‘are potentially relevant changes’. Notwithstanding these changes, however, after ‘balancing the relevant considerations’,[21] the VCAT decided that it was appropriate to extend the planning permits for the following reasons:
[21]Reasons, [71].
(a) In relation to the 14 lot permit, VABDS paid a 5 per cent public open space contribution in lieu of a reserve and, in relation to the 64 lot permit, VABDS set aside a 6,125 square metre reserve for drainage and public open space. These matters raised an issue as to whether requiring VABDS to pay a development infrastructure levy would involve ‘double dipping’ on the part of the Council.[22]
[22]Reasons, [10], [34].
(b) At the time that the Council granted the planning permits, it was aware that the proposed arrangements with the Trust relating to drainage would be interim in nature and that the Two Parcels would eventually be connected to the Council’s infrastructure which was being upgraded.[23] At that time, the Council was preparing the DCP.
(c) As the planning permits for the Two Parcels were in force when the DCP was prepared, the Two Parcels were then known to be exempt from the development infrastructure levy. Accordingly, the drafters of the DCP ‘must have fixed the contributions having regard to what permits qualified for the exemptions’.[24]
(d) Extension of the planning permits was appropriate having regard to the intention and effect of DCPO2 and the DCP, the nexus between the subdivisions and the contribution items, the question of whether the contributions could be lawfully levied when the permits were granted, the prospective effect of s 46N of the P & E Act[25] and the effect of the amendment to the 64 lot permit shortly before the commencement of DCPO2.[26]
[23]Reasons, [13]-[20], [68]-[69].
[24]Reasons, [38].
[25]In n 7 of its Reasons, the VCAT stated that ‘s 46N of the [P & E] Act only applies to the grant of a permit after the coming into operation of [DCPO2] and does not apply to amendments or extensions to a permit’. The Council did not challenge the correctness of this statement.
[26]Reasons, [34].
Once the VCAT concluded that it was appropriate to grant the extensions notwithstanding the commencement of DCPO2, the effect of s 69(3) of the P & E Act was that the extensions would have retrospective effect to the date that the permits expired. This, in turn, meant that the permits would be exempt from the requirement in s 46N of the P & E Act for the imposition of a condition for the payment of a development infrastructure levy.
Initially, I considered that there was some merit in the Council’s submission that the VCAT’s statement that it had ‘decided that DCPO2 is not a relevant change of policy having regard to its terms’,[27] meant that the VCAT treated DCPO2 as irrelevant. However, in the light of the discussion at [44] and [45] above, it is clear that what the VCAT meant by this statement is that, once it had decided that it was appropriate to grant the extensions for the reasons set out at [44] above, DCPO2, according to its terms, did not constitute a change in policy which necessitated refusal of the extensions.
[27]Reasons, [35].
It follows that the VCAT took into account the change in policy constituted by the commencement of DCPO2 as required by s 84B(1) of the P & E Act and that it did so in a manner that was consistent with Kantor.
There is no substance in the Council’s submission that the VCAT failed to take into account the likelihood of a fresh permit being granted. At para 46 of its Reasons, which is set out at [32] above, the VCAT expressly stated that fresh applications for permits would have been granted subject to a condition requiring payment of a development infrastructure levy in accordance with DCPO2. Notwithstanding this consideration, the other considerations discussed at [44] and [45] above persuaded the VCAT to grant the extensions to the planning permits.
As the Council has failed to make out its sole ground of appeal, the appeals must be dismissed.
Ruling on the Council’s application to amend the notice of appeal
At the hearing of the appeals, the Council applied to amend its notice of appeal in appeal 2034/2011 to add the following ground of appeal:
The Tribunal’s decision to certify [the 14 lot] plan of subdivision … was made in circumstances in which the applicable criteria under s 6(1) of the Subdivision Act 1988 had not been satisfied in that:
(a)Lower Murray Water, by its letter of 25 February 2011, had made clear that it:
· …objects to the extension or reissuing of the permit until such time as detailed drainage and infrastructure assessment, associated with the property can be completed. Lower Murray Water advises that it is not responsible for the management of stormwater and that the previous conditions agreed to by the [Trust] may impact on normal operations of its subterranean drainage system.
(b)the letter from the [Trust] dated 22 November 2005, properly construed, did not amount to consent to certification of the plans; and
(c)the required design plans with respect to stormwater discharge and detention (condition 5) and road design/drainage design for Karadoc Avenue frontage (condition 9) had not been submitted to the council, such that the council could be satisfied that appropriate drainage of the land could be effected in the circumstance in which Lower Murray Water had refused to support the interim stormwater discharge arrangement (required under condition 1).
Notice of the application for the amendment was provided to VABDS on 16 October 2012. VABDS opposed the proposed amendment. After hearing submissions from the parties, I made a ruling refusing the proposed amendment and stated that the reasons for my decision on the appeals would include reasons for my ruling. The following are the reasons for my ruling.
Factual background
On 22 November 2005, the Trust wrote to VABDS’ consultant and, after referring to payment by VABDS of subdivision fees when due, stated that the 14 lot plan of subdivision ‘was consented for certification on this basis’.
As stated at [20] above, on 19 August 2008, the Trust was wound up and its functions were transferred to Lower Murray Water. As at that date, the Trust had not prepared formal agreements concerning the interim drainage arrangements for the Two Parcels, as required by condition 1 of both planning permits.
Prior to the hearing before the VCAT, the Council filed with the VCAT a ‘Statement of Grounds’ in relation to the 14 lot plan of subdivision in which it ‘acknowledged that all referral authorities have provided consent to the certification of the plan, however not to the issue of a statement of compliance’.
During the hearing before the VCAT, the Council tendered a copy of a letter from Lower Murray Water to the VCAT, an extract from which is quoted at [50] above (‘Tendered Letter’).[28]
[28]See Reasons, [48].
The VCAT’s decision
The VCAT decided to order the certification of the 14 lot plan of subdivision for the following reasons:
50The Council and the Tribunal are bound by s 6 of the [Subdivision] Act in deciding certification of a plan of subdivision.
…
52The plans cannot be certified unless and until the permits are extended. As I will order those permits be extended, it is open to me to certify both plans.
53Condition 1 of both permits is the same. It provides—
Prior to certification, formal agreement between the permit holder and the relevant authority supporting the interim stormwater discharge arrangement is required.
54Does condition 1 still operate as a legal barrier to certification of either plan? There are some interesting arguments as to whether condition 1 comes within the terms of a s 6(1) requirement, but I do not need to decide that. Time has passed to implement the interim drainage arrangement. The Council’s upgraded drainage infrastructure was completed by mid 2008. Drainage from development of both parcels must now, as a matter of practicality, use that upgraded infrastructure and must not use the Trust’s (or [Lower Murray Water’s]) rural drainage infrastructure.
55Condition 1 is now otiose and is no barrier to certification of either plan.
…
64The 14 lot permit does not contain conditions to the same effect as conditions 3 and 4 of the 64 lot permit. [VABDS] has no outstanding requirements under the permit in relation to submission of further plans.
65I find, relying on the Trust’s correspondence dated 22 November 2005, that the Trust had consented to certification of the 14 lot plan before its functions were transferred to [Lower Murray Water]. I am informed there are no other outstanding consents from referral authorities.
66I will therefore order the certification of the 14 lot plan.[29]
[29]Reasons, [50], [52]-[55], [64]-[66].
The VCAT decided to give no weight to the Tendered Letter because Lower Murray Water was not a party to the proceeding before the VCAT and had not served a copy
of the letter on VABDS.[30]
[30]Reasons, [48].
In relation to the plan of a stage of the 64 lot subdivision, the VCAT decided not to order certification of this plan, because it did not comply with all the requirements of the 64 lot permit concerning roads, lots and reserves, as required by s 6(1) of the Subdivision Act.[31]
[31]Reasons, [58].
Parties’ submissions
The Council submitted that the Court should grant leave to amend the notice of appeal in appeal 2034/2011, on the basis that it raised a pure question of law which could be dealt with in the time originally allocated for the hearing of both appeals.
The Council contended that, pursuant to r 4.11(3) of the Supreme Court (Miscellaneous Civil Proceedings) Rules 2008, the amendment was necessary to ensure the proper determination of the appeal. According to the Council, the error of law identified in the proposed additional ground of appeal, if left uncorrected, would result in the Council having to comply with the VCAT’s order in circumstances in which the means of effective drainage of the 14 lot parcel is neither determined nor available.
The Council contended that, insofar as the Trust consented to the 14 lot plan of subdivision, it did so on a basis that was never satisfied and cannot now be achieved, namely, that the Trust’s drainage infrastructure would be utilised and that VABDS and the Trust would enter into a formal agreement to govern that utilisation. The VCAT acted inconsistently, so it was said, by relying on the Trust’s consent, on the one hand, and by treating condition 1 of the 14 lot permit as otiose, on the other.
Mr Ragu Appudurai, the solicitor who appeared for the Council at the hearing of the appeal, frankly conceded that the reason for the late application for amendment was that he had overlooked the matter until he commenced preparing for the appeal.
VABDS submitted that the application to amend the notice of appeal should be refused for four reasons.
The first reason was the Council’s extensive delay in making the application. VABDS submitted that the reason for the delay given by the Council was insufficient. In response to a question from the Bench as to whether VABDS required an adjournment to prepare to meet the proposed additional ground, counsel for VABDS, Mr Emrys Nekvapil, stated that, even though VABDS was prejudiced, it was likely that he would receive instructions to continue with the appeal in order to avoid further costly delays.
The second reason was that the issues sought to be agitated in the proposed additional ground of appeal were not raised at the VCAT hearing and that, had they been raised, VABDS would have sought to lead additional evidence. Mr Nekvapil informed me that, after the VCAT had made its orders, VABDS approached Lower Murray Water and ascertained that it had written the Tendered Letter in the mistaken belief that extension of the planning permits would result in the Two Parcels using Lower Murray Water’s drainage infrastructure.[32] Mr Nekvapil submitted that if the issue had been raised at the VCAT hearing, VABDS would have approached Lower Murray Water at that time and would have adduced evidence about its position.
[32]Lower Murray Water sent a letter dated 11 April 2011 to VABDS to this effect.
The third reason was the desirability of finality in litigation, consistent with the overarching purpose in s 7 of the Civil Procedure Act 2010[33] and the principles in AON Risk Services Australia Ltd v Australian National University.[34]
[33]Section 7 states that the overarching purpose is ‘to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’.
[34](2009) 239 CLR 175.
The fourth reason was that the proposed additional ground of appeal lacked substance.
Reasons for ruling
I decided to refuse the Council’s application to amend the notice of appeal principally because, as drafted, it failed to properly articulate a viable error of law.
In essence, the proposed additional ground asserts that s 6(1) of the Subdivision Act had not been complied with. In oral argument, Mr Appudurai stated that the Council relied on paras (a) and (c) of s 6(1) of that Act. Those paragraphs are set out at [7] above.
In my opinion, s 6(1)(a) of the Subdivision Act does not assist the Council because it has never been contended that the 14 lot plan of subdivision did not comply with the Act, the regulations made under the Act or any requirements of the Scheme or the 14 lot permit that ‘relate to the boundaries of roads, lots, common property and reserves’ or ‘the form and content of the plan’.
Conditions 5 and 9 of the 14 lot permit require the submission of certain design plans to the Council. Compliance with these conditions does not fall within s 6(1)(a) of the Subdivision Act.
As for s 6(1)(c) of the Subdivision Act, the only consent that is potentially relevant is the consent of the referral authority relating to drainage for the 14 lot plan of subdivision. It was common ground that the relevant referral authority until 19 August 2008 was the Trust and that, since that time, the relevant referral authority has been Lower Murray Water. The difficulty that the Council faces is that the VCAT made a factual finding that was open to it on the evidence and which was the subject of a concession by the Council, namely, that the Trust consented to the 14 lot plan of subdivision in its letter dated 22 November 2005.[35] Although the proposed additional ground of appeal asserts that this letter ‘properly construed, did not amount to consent to certification of the plans’, no reliance is placed on any recognised ground of appeal to impugn the VCAT’s factual finding in relation to the letter. Unless the Council is able to establish a legal error in relation to the factual finding, the views of Lower Murray Water are, as the VCAT found, immaterial.[36]
[35]Reasons, [65].
[36]Reasons, [48].
An additional reason for refusal of the Council’s application to amend the notice of appeal is the fact that the issues raised in the proposed additional ground were not agitated by the Council in the same manner before the VCAT. Further, the Council sought to rely on detailed new evidence in an affidavit sworn by its technical officer on 15 October 2012, much of which focused on factual matters associated with the alleged impracticality of the VCAT’s decisions. It is not appropriate for such new evidence to be adduced in an appeal that is in the nature of judicial review.[37] I accept VABDS’ submission that, had the above issues been raised by the Council at the VCAT hearing, VABDS would have sought to adduce evidence from Lower Murray Water. The raising of new substantive issues for the first time in the appeal to this Court – some of which depend on contested factual matters – only a few days before the scheduled hearing is prejudicial to VABDS.
[37]Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vic) (2001) 207 CLR 72, 79 [15]; Osland v Secretary, Department of Justice (2010) 241 CLR 320, 331-2 [18], 351 [71].
I have also taken into account the facts that the planning permits were first granted in 2005; that the decisions of the Council not to extend the planning permits were made in 2008 and 2010, respectively; that the VCAT made its decisions on 1 April 2011; and that leave to appeal from the VCAT’s decisions was granted on 19 December 2011. These significant delays, irrespective of their cause, are not in the interests of justice. Further, the delays in the development of the Two Parcels do not advance the objectives of the P & E Act, particularly the objective of ‘fair, orderly, economic and sustainable use, and development of land’.[38]
[38]P & E Act, s 4(1)(a).
The Council’s application to amend the notice of appeal is unmeritorious and was made at a very late stage of the proceeding. Further, the explanation for the Council’s delay is unsatisfactory. In these circumstances, rejection of the application will give effect to the overarching purpose in the Civil Procedure Act.
Proposed orders
For the above reasons, the appeals will be dismissed.
At the hearing of the appeals, VABDS foreshadowed an application for an order varying the extended date of 18 May 2012 in the VCAT’s orders, as that date has already passed.[39] Both parties agreed that the Court has power under s 148(7) of the VCAT Act to make incidental orders to give effect to the substantive decision of the Court. The parties also indicated agreement to an order varying the extended date of 18 May 2012 in the event that I decided to dismiss the appeals.
[39]See [25] above.
At the hearing, I expressed a preliminary view that the Court had power to vary the date in the VCAT’s orders under s 148(7)(b) and (d) of the VCAT Act, rather than remitting the proceedings to the VCAT with a direction that the VCAT vary its orders, under s 148(7)(c) of the VCAT Act. The additional delay and cost that would be associated with a remittal to the VCAT would be inconsistent with the Court’s obligation under s 8 of the Civil Procedure Act to give effect to the overarching purpose of that Act.
I will hear from the parties on the precise form of the orders to be made by the Court in each appeal and on the question of costs.
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