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[2008] VCAT 28
appellant. The Tribunal allowed the application for review, set aside the Responsible Authority's decision dated 8 March 2007 and granted a permit for a dwelling in association with a vineyard on Lot 1 TP...
VCAT allowed an application to build a dwelling on two small rural lots (total 1.65 ha) in the Farming Zone, finding the dwelling properly linked to an intended 1.3 ha vineyard. The Tribunal held that a dwelling is not prohibited in the Farming Zone and may be approved where there is a clear link to an intensive agricultural use. It required a Section 173 agreement, consolidation of the lots, and other conditions (environmental audit, bushfire measures, water storage, effluent treatment) to ensure the dwelling remains tied to agricultural use and to guard against de facto rural living.
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1,861 words · generated 11/09/2026
The applicants sought a planning permit to construct a single-storey dwelling on two adjoining rural titles (Lot 1 TP 137029X and Lot 1 TP 116732X, total area 1.65 hectares) at Moodemere Road, Norong, within the Farming Zone (see Order and Reasons). The proposed dwelling was linked to the establishment and operation of a vineyard across approximately 1.3 hectares of the land (Reasons [5], [15]). The Responsible Authority (Indigo Shire Council) refused the permit on 8 March 2007 primarily because it was not satisfied that a dwelling was necessary for establishment or operation of an agricultural activity, and it was concerned that a dwelling on a small rural lot close to Rutherglen would create an ad hoc rural living area or lead to fragmentation (Reasons [1], [2], [7], [9]).
1 cited instrument linked from this judgment.
The matter proceeded on review to VCAT. The Tribunal examined the land, the surrounding pattern of agricultural uses (grazing and irrigated vineyards), the submitted vineyard business plan, and evidence about local conditions such as soil, microclimate and water entitlement. The Tribunal accepted that a vineyard constituted a viable intensive agricultural activity for this site and that an on-site dwelling would serve to operate and manage the vineyard (Reasons [15], [16], [20]). The Tribunal also required safeguards: consolidation of the two lots, a Section 173 agreement binding the dwelling to the vineyard (preventing excision and requiring establishment and continued use for intensive agriculture), environmental audit requirements, bushfire, effluent and water supply conditions and other standard site management conditions (Order; Conditions 1–21). The Tribunal set aside the Responsible Authority's refusal and directed a permit be granted (Order).
The Tribunal's decision turns on two central considerations:
Statutory permissibility and the Farming Zone context: The Tribunal emphasised that a dwelling is not a prohibited use within rural areas. The zoning objectives include provision for agriculture and ensuring non-agricultural uses, especially dwellings, do not adversely affect agriculture (Reasons [9]). That does not mean dwellings can never be approved; rather the determining question is whether a dwelling would undermine agricultural uses or, instead, support a viable intensive agricultural enterprise.
The link between dwelling and intensive agricultural use: The Tribunal required evidence that the agricultural activity proposed (a vineyard) was viable and that the dwelling was necessary to operate and manage that activity. It stated that where establishment of a dwelling depends on the conduct of an agricultural activity, the applicant must satisfy the Tribunal as to the particular agricultural activity requiring an on-site dwelling (Reasons [17]). In this case, the Tribunal accepted the vineyard business plan and submissions about frost risk (which could require early-hour management) as justifying an on-site manager or caretaker (Reasons [15], [16], [11]). Given those circumstances, the Tribunal concluded approval was appropriate and likely to result in a more intensive agricultural use of land rather than fragmentation into rural living (Reasons [20], [22]).
To mitigate risks the Tribunal imposed conditions, notably a Section 173 agreement requiring establishment of the vineyard, preventing excision of the dwelling, and requiring that if vineyard activity ceased the dwelling must remain associated with a bona fide intensive agricultural use and a new business plan be prepared (Order condition 2). The Tribunal regarded such a condition as an appropriate and effective mechanism to secure the agricultural linkage (Reasons [19], [21]).
Before this decision: The planning framework in the Farming Zone inherently balanced agricultural objectives against the possibility of incidental residential development. Responsible Authorities often resist dwellings on small rural lots where there is a perceived risk of creating de facto rural living or fragmenting agricultural land. The decision records the Responsible Authority's customary concerns about permitting dwellings near towns where services and residential opportunities are available (Reasons [7], [9]).
After this decision: VCAT expressly confirmed that approval of a dwelling in the Farming Zone is not precluded, so long as the dwelling is demonstrably linked to a viable intensive agricultural activity and conditions (including a s173 agreement) are imposed to secure that link. Practically, Chisnall v Indigo SC reinforces that evidence about the specific agricultural enterprise (business plan, site suitability, operational needs such as frost mitigation) is crucial and that s173 agreements are a suitable tool to manage the risk of de facto rural living or fragmentation (Reasons [17], [19], [21], [22]).
The decision therefore clarifies how evidence and conditions interplay: an applicant must demonstrate the agricultural justification, and the Tribunal will use tailored permit conditions to ensure the dwelling remains tied to agriculture.
Reasons [17]: "When the establishment of a dwelling on land is dependent on the conduct of an agricultural activity then it is considered that it is incumbent on an applicant to be able to satisfy the Tribunal regarding the particular type of agricultural activity that requires an onsite dwelling."
Plain English: If you ask for a house because of an agricultural use, you must clearly explain which agricultural activity needs someone living there and why. General or vague claims are insufficient.
Reasons [19]: "It was submitted that a section 173 agreement could be placed on the title to the land requiring the vineyard to be established to the Responsible Authority's satisfaction. I consider in such circumstances that this is an appropriate condition."
Plain English: The Tribunal accepted using a legally binding agreement on the title (s173) to ensure the vineyard gets planted and the house stays linked to that vineyard; it thought such a condition was suitable.
Reasons [20]: "I am unable to conclude that allowing the establishment of a dwelling on this land will lead to a defacto rezoning of the land into rural living... I accept that the more intense agricultural activity of a vineyard is a viable agricultural activity in this area justifying in this case the establishment of a dwelling in association with such an activity."
Plain English: The Tribunal did not think approving the house would effectively turn the countryside into a residential area. The vineyard is a real, viable farming use here, so a house connected to it can be justified.
Reasons [22]: "A dwelling is not a prohibited use within a rural area and provided there is a link with an intense agricultural activity then in this case the approval of a dwelling on this land is more than likely to ensure the land will be put to a more intense agricultural use than what it is currently being used for."
Plain English: Houses are allowed in rural zones in principle; if the house is properly tied to an intensive farm use, approving it is likely to make the land used more intensively for agriculture, which is a planning aim.
This decision is most relevant where:
The judgment itself does not cite subsequent courts or subsequent treatment; within the Reasons the Tribunal refers to Planning Scheme objectives and the Responsible Authority's draft conditions and adopts many of the Authority's conditions (Reasons [23]). The decision is an application of planning discretion at VCAT, demonstrating how VCAT balances site-specific agricultural viability evidence against broader policy concerns. This decision would be persuasive in future VCAT proceedings with similar fact patterns, especially where applicants propose intensive agriculture on small rural lots and offer detailed business plans and enforceable title conditions. The judgment highlights the Tribunal's readiness to use s173 agreements and permit conditions to manage perceived risks.
Degree of evidentiary specificity: The Tribunal required satisfaction "regarding the particular type of agricultural activity that requires an onsite dwelling" (Reasons [17]). The decision accepts the vineyard business plan in this case, but it leaves open how detailed or technically supported a business plan must be in other contexts. For instance, what quantitative projections, expert reports or financial modelling will be needed in borderline cases remains indeterminate.
Threshold for "de facto rural living": The Tribunal concluded three proximate dwellings did not amount to rural living here (Reasons [14], [20]), but it did not set a numeric or qualitative test. Future cases may still involve fact-sensitive assessments; Chisnall provides guidance but not a bright-line rule.
Enforceability and scope of s173 agreements: The judgment required a s173 agreement to prevent excision of the dwelling and to bind the landowner to establish and operate the vineyard (Order condition 2). The decision endorses s173 as appropriate but does not analyse the precise drafting forms, enforcement mechanisms or the Tribunal's approach to future applications to vary such agreements. How strictly tribunals will police compliance with s173 requirements linked to on-site activity remains a practical question.
Transferability and succession: The Order ties the dwelling to the land and the vineyard; the decision does not explicitly address the effect on future owners or the circumstances in which a new owner could vary the business plan or apply to change the arrangement. The s173 condition contemplates a process if the vineyard ceases (a requirement that the dwelling continue to be used in association with another bona fide intensive agricultural use and preparation of a new business plan), but the Tribunal did not develop principles for assessing such future changes (Order condition 2(c)).
Interaction with environmental and bushfire conditions: The Tribunal imposed multiple environmental and bushfire-related conditions (environmental audit, water storage, CFA design and siting guidelines, DSE setback from tree canopies). How these conditions interact with the operational needs of an agricultural business (for example, constraints on ground disturbance affecting vineyard establishment) will need careful coordination in implementation and may generate future disputes.
This decision provides a practical framework: applicants who can demonstrate a specific, viable intensive agricultural activity and who accept enforceable title conditions to bind the dwelling to that activity stand a reasonable prospect of obtaining permits even on small rural lots, while councils retain scope to require consolidation and robust conditions to prevent undesirable fragmentation.
Disclaimer: This is general legal information based on Chisnall v Indigo SC [2008] VCAT 28. I may make mistakes. This is not legal advice. Before you rely on this analysis, or use any draft conditions or arguments in a planning application or appeal, get a qualified Australian lawyer to check it.
Before the use and/or development starts, amended plans to the satisfaction of the Responsible Authority must be submitted to and approved by the Responsible Authority. When approved, the plans will be endorsed and will then form part of the permit. The plans must be drawn to scale with dimensions and three copies must be provided. The plans must be generally in accordance with the plans submitted with the application but modified to show:
(a) the location of all building/s and works (including water tanks proposed to be erected or constructed on the land;
(b) the dimensions and elevations of all building/s proposed to be erected or constructed on the land;
(c) the nature of all external materials and finishes of all such building/s (including the roofing and above ground water tanks);
(d) the location of road access points and driveways;
(e) no building located within 60 metres of the northern-most boundary of the subject land.
(f) a permanent screen of locally indigenous trees and shrubs along the southern edge of the building envelope and driveway and the northern boundary of the land.
Before the use and /or development starts the landowner must enter into an agreement with the Responsible Authority under Section 173 of the Planning and Environment Act 1987 and make application to the Registrar of titles to have the agreement registered on the title to the land to provide for the following:
(a) In the event of a dwelling house being erected on the subject land such a dwelling cannot be excised from the Lot under the provisions of the Indigo Planning Scheme.
(b) A vineyard must be established on the land to the satisfaction of the Responsible Authority generally in accordance with the Business Plan submitted with the permit application.
(c) The dwelling on the land must be used to operate and manage the vineyard.
(b) In the event that the establishment of a vineyard on the land as described in the particulars and statements submitted with the application ceases the dwelling must continue to be utilised in association with a bona fide intensive agricultural land use that requires a dwelling on the land and a new business plan is prepared.
The owner must pay the reasonable costs of preparation, execution and registration of the agreement.
The layout of the site, dimensions and elevations of the proposed building/s and works as shown on the endorsed plans shall not be modified or altered without the written consent of the Responsible Authority.
Before the use and/or development starts Lot 1 TP 137029X and Lot 1 TP 116732X shall be consolidated into a single lot by a Plan of consolidation and registered with the Registrar of Titles to the satisfaction of the Responsible Authority.
(a) A Certificate of Environmental Audit in accordance with Section 53Y of the Environment Protection Act 1970; or
(b) A Statement of Environmental Audit under Section 53Z of the Environment Protection Act 1970,
(ii) Where a Statement of Environmental Audit is issued for the site, the Statement must state that the site is suitable for residential use and development. All directions and conditions contained within the Statement must be complied with.
(iii) Where a Statement of Environmental Audit is issued for the site, before the construction of the dwelling commences, the applicant/owner must provide written advice from an environmental auditor (appointed pursuant to the Environment Protection Act 1970) to the effect that any conditions related to the development of the site have been met.
(iv) The landowner must enter into an agreement under Section 173 of the Planning and Environment Act 1987, where there are ongoing maintenance and/or monitoring requirements, to ensure such requirements are satisfied. Where such an agreement is required, it must be entered into prior to the commencement of construction of the dwelling. All costs associated with the drafting and execution of the agreement, including those incurred by the Responsible Authority, are to be met by the applicant/owner.
This planning permit approves the construction of a new dwelling only and does not approve the installation of a re-erected dwelling on the land. The installation of a re-erected dwelling shall require the further consent of the Responsible Authority.
Prior to construction of the dwelling commencing, consent of Council for installation of an on-site sewerage treatment package plant must be obtained. Such system must have an EPA Certificate of Approval issued under Section 53M(7) of the Environment Protection Act 1970 and must comply with the provisions of the Guidelines for Environmental management - Septic Tanks Code of Practice, Publication 891, Environment Protection Authority (March 2003) and be located, installed and operated so as to ensure all effluent and wastewater is disposed of and absorbed within the boundaries of the land to the satisfaction of Council's Environmental Health Officer.
(i) Unless otherwise approved by the Responsible Authority, water storage tank(s) must be provided in close proximity to the dwelling holding a minimum of 90,000 litres of water, of which a minimum reserve of 20,000 litres is to be held at all times for firefighting purposes.
(ii) Tanks must be fitted with a gate valve and a 64mm, 3 thread round male coupling to CFA specifications to enable quick connection and full utilisation of all water.
(iii) All tanks shall be environmentally unobtrusive and screened to the satisfaction of the Responsible Authority.
All new development on the land must be carried out in accordance with the Country Fire Authority's "Design and Siting Guidelines - Bush Fire Protection for Rural Houses".
To minimise soil erosion during construction, the landowner and builder must ensure that any clearing or construction associated with development is conducted in accordance with sediment control principles as outlined in "Construction Techniques for Sediment Pollution Control" ( Environment Protection Authority 1991). Specifically the landowner and builder must ensure:
(i) Any new vehicular access points required and any required existing crossing points not complying with current standards shall be constructed at full cost to the applicant/owner at a location and to a standard, to the satisfaction of the Responsible Authority and levels fixed.
(ii) Any other existing accessed, including gateways and/or driveway crossings, must be removed and fenced across to prevent further vehicle access. The road reserve and road formation must be left in a neat and tidy manner.
The point of access to the site shall be a point that gives practical access to the building location to the satisfaction of the Responsible Authority.
All works within the road reserve must be undertaken in accordance with the requirements of the Indigo Shire Roadside Management Plan.
The discharge of concentrated storm water drainage into the road drains or culverts will not be permitted. All storm water emanating from the development approved by this permit shall be disposed of within the curtilage of the property.
The finished floor level of the proposed dwelling is to be constructed a minimum of 300 millimetres above the 1% flood level of 133.1 metres AHD: i.e. at least 133.4 metres AHD.
All ground disturbing works associated with the development and use of the residence and vineyard must be setback a minimum distance of 10 metres from the canopies of all trees shown on plan S3270, Version 3, dated 20 November 2006 unless written permission is obtained from Indigo Shire in consultation with DSE prior to commencing works.
This permit will expire if one of the following circumstances applies:
(i) The Plan of Consolidation is not certified within two years of the date of this permit;
(ii) The development is not commenced within two years of the date of this permit;
(iii) The development is not completed within two years of the date of commencement.
The Responsible Authority may extend the periods referred to if a request is made in writing before the period expires or within three months of the date of expiration.
Chisnall
Indigo SC [2008] VCAT 28
The Tribunal allowed the application for review, set aside the Responsible Authority's decision dated 8 March 2007 and granted a permit for a dwelling in association with a vineyard on Lot 1 TP 137029X & Lot 1 TP 116732X Moodemere Road, Norong, subject to specified conditions including amended plans, a Section 173 agreement, consolidation of lots, environmental audit, bushfire and effluent requirements, water storage, and other site management conditions (Order dated 3 January 2008).