Mr. C. Fadgyas, Town Planner, represented the Responsible Authority.

Mr. M. Naughton, Lawyer, represented the Applicants for Review/Permit Applicants

1. This is an Application for Review pursuant to Section 77 of the Planning and Environment Act 1987 against the decision of Rural City of Mildura which refused Application for Permit No. P01/231 for lot subdivision (re-subdivision to create six residential allotments.

1. The subdivision is contrary to Clause 17.05 of the State Planning Policy Framework.

2. The subdivision is contrary to Clause 21.02-3 and 22.05-1 of the Local Planning Policy Framework.

3. The subdivision is contrary to the Purpose and Decision Guidelines in the Rural Zone.

4. The subdivision would create an undesirable precedent for the subdivision in the Rural Zone.

1. The subdivision is not contrary to Clause 17.05 of the State Planning Policy Framework.

2. The subdivision is not contrary to Clause 21.02-3 and 22.05-1 of the Local Planning Policy Framework.

3. The subdivision is not contrary to the Purpose and Decision Guidelines of the Rural Zone.

4. The subdivision would create an undesirable precedent for subdivision in the Rural Zone.

4. The proposal seeks to subdivide land into seven lots. Lots 1 to 6 (inclusive) will be 4000 square metres in area and have a frontage of about 60 metres to Benetook Avenue, a sealed road. The remaining lot (Lot 7) would be 16.9 hectares in area and have road frontages of 38.31 metres to Benetook Avenue and 234.86 metres to Cowra Avenue, an unconstructed road. The application form described the Purpose as re-subdivision. Accompanying correspondence from Roy Costa & Associates advised that at present nine separate parcels of land titles exists, of sizes 4.047 hectares, 0.06 hectares, 1.6 hectares, 1.2 hectares, 2.8 hectares, 4.041 hectares, 1.7 hectares, 3.2 hectares and 0.8 hectares. A detailed written submission was provided which purported to outline the advantages of the application.

5. The Responsible Authority requested further information as copies of the Certificate of Title referred to four individual titles containing the various allotments. In response Mr. Costa advised the Responsible Authority:

1. The titles office has advised Council that the separate parcels of land detailed on the titles are individual parcels that can be dealt with on their own.

2. The allotments are of sufficient size to cater for a dwelling with septic tank services provided.

3. Access to the allotments can be provided via a carriage way easement if required.

4. Therefore, access is able to be provided, thus the allotments can cater for dwellings and housing entitlements do exist for the number of allotments proposed.

6. The subject land is located on the eastern side of Benetook Avenue between Twentythird Street and Redcliffe Avenue in Koorlong. This about 11 or 12km south-east of the business district of Mildura.

7. The property has a total area of 19.448 hectares and contains a dwelling and vineyard activities. The vineyard activities currently occupy about 50% of the site.

8. Land in the vicinity of the site is used for horticultural (vineyard purposes) with some isolated dwellings.

9. The site is some 1km south of the Koorlong settlement which comprises a Low Density Residential Zone, a local store and school.

10. The subject site contains nine lots most of which are of an odd shape although these lots are contained on four individual certificates of title.

11. The subject land is zoned Rural pursuant to the Mildura Planning Scheme. One of the purposes of the zone is "To ensure that subdivision promotes effective land management practices and infrastructure provision."

12. A permit is required pursuant to Clause 35.01-4 of the Planning Scheme to subdivide land. There are certain requirements in this zone which allow subdivision below four lots which are less than 10 hectares in area. The two operative provisions require::

* The subdivision is the re-subdivision of existing lots. The number of lots must not be increased and all lots must be at least 0.4 hectare.

* The number of lots is no more than the number the land could be subdivided into in accordance with the schedule to this zone. All lots must be at least 0.4 hectare. An agreement under Section 173 of the Act must be entered into with the owner of each lot created which ensures that the land may not be further subdivided so as to increase the number of lots, unless creating a lot for an existing dwelling. The agreement must be registered on title.

13. There are also various Decision Guidelines pursuant to Clause 35.01-6 which require the Responsible Authority to consider.

14. Other planning controls and policies of relevance in this application are contained within the following clauses:

* Clause 17.05 - Agriculture. Part of this provision requires:

"Subdivision of high quality productive agricultural land should not detract from long term productive capacity of the land."

In considering a proposal to subdivide or develop agricultural land, the following factors must be considered:

* The desirability and impacts of removing the land from primary production, given its agricultural quality and productivity.

* The impacts of the proposed subdivision or development on the continuation of primary production on adjacent land, with particular regard to land values and to the viability of infrastructure for such production.

* The compatibility between the proposed or likely development and the existing uses of the surrounding land.

"Where inappropriate subdivisions exist on land of high agricultural quality, priority should be given by planning authorities to their re-structure."

"The main agricultural and horticulture characteristics of Mildura Rural City include:

* Horticulturists within the municipality and surrounding Sunraysia District produce more than 95% of Australia's dried vine fruit, 60% of Australia's table grapes, 50% of Australia's asparagus; 37% of Australia's wine grapes; 31% of Australia's carrots; and 20% of Australia's citrus. The majority of this activity occurs on irrigated land centred on Mildura, Irymple, Red Cliffs, Nangiloc and Merbein. There is also significant almond production at Lindsay Point.

* The main agricultural activities of dryland farmers in the municipality include production of mixed cereal crops (12% of Victorian Production), wool (2.3% of Victorian Production), grain and pasture legumes. These activities are focused in the Mallee country to the south and west of Mildura. There is also significant egg production at Murrayville. Major regional livestock saleyards are located at Yelta and 0uyen.

* Both dryland and irrigated horticultural industries have recognised that "clean and green" production is vital to prosper in their export driven industries.

* Gross value of production from these agricultural and horticultural activities exceeds $300 million per annum.

* Clause 21-04-5 - Agriculture and Horticulture. One of the strategies identified in Clause 21.04-5 are to:

* Discourage non agricultural use and development on land zoned rural.

* Discourage the excision of smaller lots in horticultural areas.

* Ensure that future subdivision of agricultural land is based on sustainable and viable farming methods and on sustainable environmental grounds.

"Subdivision of land (within a gazetted irrigation district or where a Water Licences has been issued and applied to land for horticulture) in order to provide a lot for an existing or additional dwelling which is not incidental to the use of the land for crop raising, is strongly discouraged. (Tribunal emphasis)

15. At the review hearing both parties provided detailed written submissions. The Tribunal was provided with an array of policy documents, planning scheme policies and provisions, locality and zoning maps and previous VCAT Decisions. The Tribunal also advised the parties that it had viewed the site prior to the review hearing.

16. At the commencement of the hearing Mr. Naughton sought leave to substitute the name of the applicant from Roy Costa & Associates to D. Crisera and G.E. & N. Knight. There was no objection to this variation and the Tribunal duly amended the application pursuant to Section 64 of Schedule 1 of the VCAT Act.

17. Mr. Fadgyas for the Responsible Authority argued the proposed subdivision contravenes the policy contained within Clause 17.05 of the State Planning Policy Framework in that it provides for residential/rural living style development with no productive or necessary rural purpose into an area which has been zoned for rural purposes. He advised the current land use as a productive horticultural enterprise, with an existing dwelling to allow on-farm production.

18. Mr. Fadgyas argued that to permit the subdivision would reduce the total area available for horticultural purposes with an expectation that these lot will be built upon, in essence removing up to 2.4ha (about a quarter of the area under cultivation) of the current land for residential purposes or non-agricultural uses. He also advised that a Low Density Residential estate with significant vacant capacity already exists on Benetook Avenue some kms to the north of the subject site at the edge of the urban area, and there was little justification to create the nucleus of another one in the Rural zone at this location.

19. Mr. Fadgyas argued that the proposal was contrary to Clause 22.05 of the Planning Scheme referring to the protection of agricultural and horticultural land. He argued the main purpose of this is "To retain high value rural land for agricultural and horticultural production purposes". He referred to Clause 22.05 as a key factor to be considered when determining this application_._

20. Mr. Fadgyas argued that the proposed subdivision was contrary to the purpose and decision guidelines in the Rural zone and he claimed the use of this clause for the proposal is based on the interpretation that the Channel Reserve areas are lots with a discretionary house "entitlement". He claimed that while the owner has purchased these channel reserves, they are not seen as a lot on a conventional subdivision plan. He argued that although the Rural Zone provides for the creation of small lots in certain areas, under certain circumstances, it is not generally encouraged under either the State or Local planning policies.

21. Mr. Fadgyas argued that permitting these style of rural residential allotments places additional strain on existing infrastructure (drainage, sewerage, flooding) and natural resource management issues of the land such as land degradation and inefficient water management use. He also argued that as a result in a loss of agricultural land, the proposal also has the potential to cause detriment to adjoining farms. He claimed the change of land use may increase the value of land in the vicinity and result in subsequent reduction in horticultural viability.

22. Mr Naughton for the permit applicants, argued the proposal represents a re-subdivision of nine separate saleable parcels of land and the re-subdivision comprises seven lots. He argued that the Rural Zone provisions at Clause 35.01-4 state, in part, that a permit may be granted to create lots smaller than 10 hectares if the subdivision is the re-subdivision of existing lots. He argued that the approved subdivision satisfies the technical requirements in that clause.

23. Mr. Naughton also argued that the re-subdivision provisions at Clause 35.01-4 considered in the context of the purposes of the Rural Zone and Clause 17.05-2 contemplate the possible re-subdivision of rural land that is already fragmented and argued that the Tribunal has acknowledged that the restructuring of existing lots to produce a better planning outcome is, in certain circumstances, an appropriate planning tool in rural areas. Mr. Naughton referred to Yarra Glen Vineyards v Yarra Ranges Shire Council & Anor (1999/51218) and David and Linda Morris v South Gippsland Shire Council 2001/025648) and E.M.D. Cummins v Rural City of Mildura (2000/63271).

24. Mr. Naughton argued that the Responsible Authority has interpreted and adopted the "Cummins" decision as supporting a blanket refusal of re-subdivision applications which create additional house entitlements in the Rural Zone. He claimed Council appears to have relied on this decision as the main reason for refusal of the subject application, rather than an examination of the application detail. He submitted that the principles upheld by the Tribunal in that case cannot be construed so broadly as to support a blanket prohibition and he distinguished the Cummins application with this proposed re-subdivision. In particular he argued that:

(a) The subject proposal comprises five existing lots with road frontage which are not former unused channel reserves purchased from the water authority. These lots are bona fide small rural lots, the size and configuration of which do not require any improvement to increase their ability to accommodate a house. He claimed these lots are clearly "saleable as is".

(b) Whilst part Lot 15 (1.6ha) and part Lot 7 (2.8ha) are former channel reserves, they are of more than sufficient size and configuration to support claims to housing entitlements. Each lot can easily accommodate a house, and semi rural related activities. The only downside to these lots is the lack of road frontage which can be overcome by carriageway easements.

c) It is noted that part Lot 7 is 0.847 hectares in ara, and whilst irregular in shape, is almost four times larger than the water channel lots considered in Estate of E.M.D. Cummins v Rural City of Mildura.

25. Mr. Naughton argued that the subdivision will achieve precisely what is contemplated under Clause 17.05-2, by consolidating the greater majority of the land holding in a single parcel of approximately 16.9 hectares, which is in excess of the 10 hectare minimum lot size for the Rural Zone, whilst consolidating the other subdivision entitlements along Benetook Avenue on a total land area of approximately 2.4 hectares. He argued the continued horticulture viability of the balance lot is a preferred planning outcome compared to the possible fragmentation that could occur (without the need for any further planning approval) should be the land parcels he sold independently. He submitted that the restructure of the current title configuration will assist in the continued future use of the large balance of the land for agricultural purposes consistent with the above policies. He claimed the separate sale of existing titles would not achieve the same outcome.

26. Mr. Naughton made reference to the Responsible Authority's assertion that three is currently only five house entitlements in respect to the subject land. He advised Council did not specify which lots could accommodate a dwelling and assumed that Council was referring to the lots which have frontage to either Benetook Avenue or Cowra Avenue. He argued that by deduction, Council appears to have considered the remaining four landlocked lots to be unsuitable for a dwelling. Mr. Naughton argued there are no physical site constraints which would exclude a dwelling from being erected on any of the existing lots, and that carriageway easements can be created to provide access to Benetook Avenue to those three land locked parcels using common access points onto this road if necessary.

27. Mr. Naughton also refuted the Responsible Authority's argument that the proposed subdivision would create an undesirable precedent and tabled a list of recent planning permits issued for subdivision and claimed that two particular applications were highly comparable to the subject application but those were approved. He claimed Council's refusal of the subject application is inconsistent with those recent approvals.

28. Mr. Naughton also submitted that objectors will not suffer any substantial detriment resulting from the proposed subdivision or future residential development of Lots 1-6 having regard to the key planning considerations. He acknowledged that the Tribunal may have regard to future use and development of rural residential lots when determining potential impacts of a subdivision on surrounding landowners, however he claimed that development of each of the smaller lots for a dwelling will require a planning permit. He argued that the subdivision along Benetook Avenue will affect the visual amenity of the rural area is minimal and argued that extensive planting can be expected to be carried out as part of the subdivision which will assist in screening further housing and minimise the extent to which the rural landscape is modified. He argued that additional landscaping could be required by conditions as part of the development of Lots 1-6 if necessary. There was also submission made regarding the ability of the sites to contain dwellings and effectively control on-site waste water.

29. I consider this application principally fails because it proposes six residential lots on existing Rural zoned land which is currently used for horticultural purposes. This would appear to run contrary to the policy in Clause 22.05-1 which states "subdivision of land (within a gazetted irrigation district or where a water licence has been issued and applied to land for horticultural) in order to provide a lot for an existing or additional dwelling which is not incidental to the use of the land for crop grazing is strongly discouraged."

30. I acknowledge the efforts by the applicants to reconfigure these lots to create one larger horticultural holding, but as Mr. Fadgyas argued this would result in 2.4 hectares of land potentially being lost to horticultural practices. Whilst on the one hand there is some benefit in creating a larger 16.9 hectare parcel (with a Section 173 Agreement limiting any further subdivision), I do not consider the advantage of such actions outweighs the loss of horticultural land (whether or not it is currently used for those purposes).

31. I consider this application may also assist to introduce residential activities which have no relationship with the agricultural practices taking place on the adjoining, larger holding. I see this as potentially leading to future conflicts between farming and non farming uses, such as from domestic pets and/or noise from agricultural activities. I consider this would not be a good planning outcome.

32. I acknowledge Mr. Naughton's argument that much of the direction contained in the Council policies are aimed at "excision" of land whereas this application will reduce the number of "lots" on site, however the first part of the policy provision in Clause 22.05-1 does not talk about excision of land, rather it talks about subdivision of land in order to provide a lot for an existing or additional dwelling which is not incidental to the use of land for crop grazing.

33. I also acknowledge the differences made between this application and those in the Cummins decision. I agree with Mr. Naughton's submission that every application should be considered on its merits having regard to the policy documents. Whilst Mr. Naughton emphasised that the proposed lots satisfies the "technical" requirements of Clause 35.01-4, that does not necessarily mean that a permit should automatically flow. Clause 65 refers to this matter, it also requires a responsible authority to consider, as appropriate, the purposes of the zone, the orderly planning of the area, and the Municipal Strategic Statement, local planning policies and so forth.

34. Mr. Naughton also argued that the proposal in the context of Clause 17.05-2 is consistent with the planning scheme provisions. It is noted that part of Clause 17.05-2 refers to the role planning authorities should play in the restructure of inappropriate subdivisions. Whilst Mr. Naughton inferred that that clause may have used the term "responsible authorities" and "planning authorities" interchangeably, a reading of the entire clause shows distinctions between the use of both terms.

35. I do not consider the State policy (Clause 17.05-2) intended the Responsible Authority to give priority to this type of "restructure", and one where it would create six residential lots and reduce land available for agricultural production as a realistic justification for this type of restructure.

36. Whilst Mr. Naughton made great emphasis of the benefits of "restructuring the agricultural lot", my observations of the site was that it was predominantly occupied by one agricultural unit albeit on some odd shaped lots. I saw no evidence that these odd shaped lots in fact undermined the agricultural viability of the land. Rather a number of these unusual and small lot sizes seem to be used as a justification for creating six "residential" or rural residential lots.

37. During the hearing I drew a distinction between this application and the application heard by me on 21 May 2001 at River Avenue, Merbein South (2002/P13) where I set aside the Responsible Authority's decision and directed the issuance of a permit for subdivision. As I explained at that hearing, that subdivision proposal removed a small lot from within a generally central position amongst a larger agricultural lot and there was demonstrated advantages to the agricultural production of that larger agricultural lot. No such evidence was provided to me in this Application for Review.

38. I also have examined other review decisions including Yarra Glen Vineyards v Yarra Ranges Shire Council (1999/51218) and draw the following distinction.

* No evidence was tendered about the economic benefits for the grower.

* No information was tendered about the future use of the 6 x 4000 square metres lots other to the general knowledge that they would reach the minimum threshold size to be considered in any future application for permit for use and development as a dwelling (other than a statement appearing on the actual Application for Review form).

* The proposal would place six rural residential lots together where previously the land was available for agriculture.

* Whilst it is not uncommon to see clusters of houses set amongst vineyards, I see a distinction between a land owner who is also the farmer living in a dwelling set amongst viticulture/horticulture and six separate dwellings on separate lots which have no relationship with the agricultural practices occurring on an adjoining larger lot. Whilst I agree that the placement of one or two houses in a cluster is hardly suburbia, this does not address the fundamental issues of reduction in use of viable agricultural land and placement of residential type lots in the midst of agricultural land, which in themselves, could engender future and potential conflicts between land uses.

39. I also consider the comments of Ms. Monk in David and Linda Morris v South Gippsland Shire Council (2001/25648) are worthy and agree there may be a need to balance the advantages of creating one 16.9 hectare lot for agricultural production through such means as a Section 173 Agreement against the disbenefits of introducing non-rural activities or at least subdivision of lots which would encourage or increase expectations of residential development abutting agricultural practices. However I do not consider that the merits of this application outweigh the disbenefits and therefore consider the proposal should not be supported.

40. During the hearing Mr. Naughton invited the Tribunal, if I thought fit, to reduce the number of lots or relocate a number of the lots so as to address a number of criticisms raised by Council Officers on sight lines and drainage issues. I do proposed to take up that offer in this particular case because I consider the creation of several 4000 square metre lots at the bottom end of Benetook Avenue at Koorlong in the form proposed would not be a suitable planning outcome in this case.