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[2001] VCAT 1602
respondent. Permit No. P2483/98, issued by Melton Shire Council on 30 April 1999 is cancelled (see Order and [44]).
Melton Shire issued a permit to subdivide land into 208 lots that included a condition (Condition 17) requiring the owner to enter a section 173 agreement to pay contributions toward infrastructure. The Supreme Court found that condition was not authorised by the Planning and Environment Act and sent the matter back to the Tribunal to decide whether the permit could survive without the condition. Applying established severability tests, the Tribunal concluded the condition was not trivial but fundamental to the decision to grant the permit, especially because there was no approved Development Contributions Plan and there was no urgent need for the lots. Because the permit would not and should not have been granted without the invalid condition, the Tribunal cancelled the permit.
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The Tribunal considered whether Permit No. P2483/98 (Melton Shire Council, 30 April 1999) to subdivide land into 208 lots should survive after the Supreme Court (Balmford J) found that the permit condition requiring a contribution via a section 173 agreement (Condition 17) was not authorised by s62 of the Planning and Environment Act 1987. Balmford J set aside the Tribunal's prior order and remitted the matter to the same Member for rehearing, specifically to decide severability and whether the permit would or should have been granted without Condition 17 (see [1]–[2], [5]).
Condition 17 required the owner to enter into a s173 agreement providing monetary contributions ($4,175 per lot at the time) towards works and services identified in the draft Melton Township Development Contributions Plan (DCP) (see [5]). Balmford J held that Condition 17 was not authorised by s62 because, among other reasons, s62(6)(b) prevents conditions that require a person to 'pay an amount for' rather than to 'provide' infrastructure, and the statutory scheme after the Development Contributions Act contemplated contributions to be collected via an approved DCP (see [6]–[8]).
On remittal the Tribunal conducted a further hearing (13 and 15 December 2000) with expert evidence (urban economists and planners) about the need for subdivision and the consequences of deleting Condition 17. The Tribunal concluded Condition 17 was not a trivial or collateral addition; it was fundamental to the original grant of the permit because it addressed equitable and timely provision of infrastructure demanded by the subdivision and there was no overwhelming immediate need to create the lots (see [35]–[44]). Applying s85(1)(g), the Tribunal found the permit would not and should not have been granted without Condition 17 and therefore cancelled the permit (Order; [44]).
Two legal threads dominated the decision:
Statutory scope of contribution conditions: The Tribunal accepted Balmford J's analysis that the relevant statutory amendments and Part 3B concerning Development Contributions Plans created a constrained mechanism for collecting monetary contributions from developers. In particular, s62(5) and s62(6) substantially limit conditions that seek monetary payments, and contributions shared among multiple developers are to be implemented through an approved DCP. Condition 17 sought to require monetary payment rather than direct provision of works on the land and thus fell into the restricted category absent an approved DCP (see [6]–[9]).
Severability and s85(1)(g): The Tribunal applied established severability principles derived from Kent County Council v Kingsway Investments and interpreted in Spurling and Crighton. The core question under s85(1)(g) was whether the permit 'should not or would not have been granted without the condition' (statutory test at [3]). The Tribunal found that although deletion of Condition 17 would not change the mechanical manner of subdivision, the condition was intended to secure the equitable and timely staging of infrastructure, a purposive planning concern. Given Clause 65(2) required consideration of availability of subdivided land and need for further lots and expert evidence showed modest projected take-up (10–15 years horizon), there was no overwhelming urgency for the lots. Thus the responsible authority would not and should not have granted the permit absent the capacity to secure contributions (see [35]–[44]).
The interaction of the statutory limitation on monetary contribution conditions and the planning policy framework that encourages equitable funding of infrastructure (Clauses 13, 18.12, 22.04, and Clause 65(2)) led the Tribunal to conclude that Condition 17 was fundamental and not severable. Accordingly the Tribunal exercised the cancellation power in s85(1)(g) (see [3], [37], [44]).
Before these proceedings the practical picture in many Victorian municipalities had been that contributions could be sought by various instruments, including section 173 agreements and council policies. The Development Contributions Act and the insertion of Part 3B into the Planning and Environment Act created a statutory framework for approved DCPs as the primary mechanism for collecting developer contributions. Balmford J's prior decision clarified that the general power to impose conditions (s62(2)) is curtailed by s62(5) and s62(6) with respect to monetary contributions, so that shared monetary levies must conform to the DCP machinery (see [6]–[8]). The Tribunal accepted this construction.
After this decision (and Balmford J's earlier ruling), responsible authorities could expect tighter limits on imposing monetary contribution conditions via s173 agreements in the absence of an approved DCP. The Tribunal's application of s85(1)(g) reinforces that, where a contribution condition is central to the planning assessment and is invalid, the permit may be voided rather than the condition being severed, particularly where planning guidelines indicate no pressing need for immediate subdivision and the condition was relied upon to secure equitable infrastructure funding (see [3], [35]–[44]).
Statutory test (plain text): "s85(1)(g) ... cancel a permit if ... it considers that the permit should not or would not have been granted without the condition" ([3]). Plain English: The Tribunal can cancel a permit when a condition is invalid and the permit depended on that condition.
Characterisation of Condition 17 as beyond s62: "Section 62(6)(b) prevents the imposition of any condition that provides for a person to enter into a Section 173 agreement requiring them to 'pay an amount for' as opposed to actually 'providing' infrastructure services or facilities." ([6]). Plain English: The statute draws a line between ordering someone to actually build or provide a thing and ordering them to pay money; the latter is constrained and generally requires following the DCP rules.
Severability conclusion: "Condition 17 could not be described as a trivial, incidental or a merely superimposed element of the permit" ([35]). Plain English: This condition was a key part of why permission was given; removing it is not a minor tweak.
Final dispositive: "Condition 17 ... was an important, indeed 'fundamental' element ... without Condition No. 17 a permit would not and should not have been granted. The permit must fall without the condition and accordingly I will cancel the permit." ([44]). Plain English: Because the condition was essential and invalid, the whole permit is cancelled.
This decision is triggered where:
A permit contains a condition requiring monetary contributions (or shared levies) tied to a Development Contributions Plan, but no approved DCP exists at the time the condition is imposed (see [5]–[9]).
The invalid condition is a central feature of the planning decision, i.e., it is relied upon to ensure equitable, staged provision of infrastructure rather than being merely an incidental requirement (see [35]–[37], [44]).
The planning context shows no immediate or overwhelming need for the subdivision; the decision to approve depended materially on securing contributions or deferring subdivision until a proper funding mechanism exists (see [40]–[43]).
The statutory severability test under s85(1)(g) is engaged, requiring inquiry whether the permit would or should have been granted without the invalid condition (see [3], [35]–[37]).
This decision is a Tribunal application of Balmford J's earlier ruling about the limits on contribution conditions and an application of severability principles from higher authority (Kent, Spurling, Crighton). The Tribunal followed the approach of those authorities in applying the statutory s85 test and emphasising the planning policy context (Clauses 13, 18.12, 22.04, 65). The decision demonstrates that, in Victoria, the combination of statutory DCP machinery and Clause 65(2)-type planning guidelines can lead a decision-maker to view a contribution condition as fundamental. Practitioners should expect other tribunals and courts to consider similar factors: whether a condition is collateral or essential, the statutory DCP regime, and the planning supply/demand context.
Note: This Deep Dive does not catalogue subsequent authorities that may have cited or refined Curry v Melton SC. Its focus is on the decision itself and its internal application of precedent.
Boundary of "paying an amount" vs "providing works": The Tribunal accepted Balmford J's reading that s62(6)(b) prevents conditions requiring payment rather than provision where a shared contribution is sought absent an approved DCP (see [6]). There remains practical uncertainty about the precise circumstances where a condition requiring payment for works that directly relate to the subject land (e.g., onsite works or direct off-site works exclusively benefiting the land) is permissible without a DCP.
Interim mechanisms and 'interim fix' overlays: The Tribunal noted Council was considering an interim Contributions Plan Overlay approach to allow s173-style agreements pending formal DCP incorporation (see [11]). The legal status and durability of such interim fixes, and whether they provide sufficient statutory authority for contributions, remains an area requiring close attention.
Standard for 'overwhelming need': The decision turned on the absence of an 'overwhelming need' for lots at the time, informed by expert evidence (Haratsis) and Clause 65(2). How courts will weigh differing expert forecasts, development front dynamics, and market signals in future cases will continue to be fact-sensitive.
Equity consequences for other developments: The Tribunal observed that allowing subdivisions to proceed without approved contribution mechanisms could shift costs to existing ratepayers (see [33]). Future litigation may consider the broader fiscal and equity implications where some subdivisions are approved with invalid contribution conditions and others are not.
Role of honest municipal practice: The Tribunal commented that councils acted consistently with planning policy and with an honest belief that s173 agreements could secure contributions (see [38]). Whether such honest but incorrect administrative practice can ever validate otherwise ultra vires conditions remains legally constrained by statute, but may have political or policy consequences.
This deep dive is grounded in the Tribunal's reasons in Curry v Melton SC [2001] VCAT 1602 as cited above. It summarises the Tribunal's statutory reading, application of severability doctrine, and factual findings.
This is general legal information, not legal advice. I can make mistakes. Before you act on, rely on, or use any draft or interpretation here, get a qualified Australian lawyer to check it.
Planning List; Permit to subdivide land; Permit condition seeking monetary contribution under a Section 173 Agreement found invalid by Supreme Court; Matter remitted to the Tribunal; Under Section 85(1)(g) Planning and Environment Act 1987 Tribunal may cancel a permit if a condition in the permit is invalid and the Tribunal considers the permit would not or should not have been granted without the condition; Tests for severance of conditions referred to in Kent County Council v Kingsway Investments (Kent) Ltd [1971] AC 72, Spurling v Development Underwriting (Vic) Pty Ltd [1973] VicRp 1; [1973] VR 1 and Crighton v City of Moorabbin [1992] VR 2, discussed. Melton Planning Scheme Clause 65(2) decision guidelines require consideration of "the availability of subdivided land in the locality, and the need for the creation of further lots", Found that the condition was not trivial but was fundamental to the grant of a permit in the absence of no overwhelming need to subdivide at this time. Permit cancelled.
Medium Neutral Citation [2001] VCAT 1602
Subject Land Section 11, Part Crown Allotment C Volume 9917, Folio 774, No. 360-410 Bulmans Road, Melton
Permit No. P2483/98, issued by Melton Shire Council on 30 April 1999 is cancelled.
Mr Mark Bartley, Solicitor of Phillips Fox Lawyers represented the applicant for review. He called evidence from Mr Brian Haratsis, Urban Economist with Marco Plan.
Mr Terry Montebello, Solicitor of Maddock Lonie and Chisholm Lawyers represented the respondent, respondent authority. He called evidence from Mr Siedlecki, Senior Planner for the Shire and Mr Marcus Spiller, Urban Economist with Spiller Gibbon Swan.
1. To quote from the opening paragraph of Mr Bartley's submission in this remitted hearing:
"This appeal follows the judgment of Balmford J in Proceeding 4915 of 2000 which was an appeal by the appellant against the validity of Condition 17 as proposed by the determination of this Tribunal.
The Court found that Condition 17 `is not authorised by Section 62' (para 26). The Court ordered that the order of the Tribunal be set aside and the matter remitted to the Tribunal to be heard and decided again by the same Member with the hearing of further evidence as appropriate."
2. The reason for the matter being remitted can be attributed to a question raised in the course of the hearing before Justice Balmford, by Mr Wright QC, Counsel for the Shire of Melton. The question was whether, in the event of Condition 17 being found to be invalid it could be severed from the permit without, as submitted by Mr Wright "altering the substantial intended effect of the Tribunal's determination". In response to this question Her Honour found, at paragraphs 31 and 32:
"31 The issue of the severability of the condition was examined at some length by both counsel, with reference to Spurling and other authorities and to the power conferred on the Tribunal by paragraph 85(1)(g) of the Act. As a result I have formed the view that the material before me does not enable me to reach any conclusion as to that issue. A decision that the condition is not severable, and that the permit falls with the condition, would obviously have a significant affect (sic) on the future of subdivision in the Shire of Melton until such time as the DCP is approved by incorporation in the planning scheme. The determination of that issue involves both matters of evidence and matters of planning expertise and I need only refer to the well-known passage at page 11 of Spurling where Stephen J referred to "areas in which members of the Tribunal have special expertise and experience which the legislation plainly intends them to employ".
32 Accordingly, I consider it appropriate that I order that the order of the Tribunal be set aside and the matter remitted to the Tribunal to be heard and decided again by the same member who made the original order, with the hearing of further evidence so far as the Tribunal considers it appropriate."
3. So far as is relevant here, Section 85(1)(g) of the Planning and Environment Act 1987 ("the Act") provides that:
"85(1) After hearing an application for review, the Tribunal may -
(i) it upholds an application for review of a condition specified in a permit on the ground that the responsible authority had no power to impose the condition; and
(ii) it considers that the permit should not or would not have been granted without the condition."
4. The key question now before me following the Court's remittance of this matter is whether Permit No. P2483/98 issued on 30 April 1999 to subdivide land in Bulmans Road, Melton into 208 lots should not or would not have been granted without Condition No. 17. In other words does the permit fall without Condition 17?
5. Before considering this issue it is necessary to identify the condition in question and some of the background to Her Honour's finding of its invalidity. To quote from introductory paragraphs 2 and 3 of Justice Balmford's judgment:
"2. On 30 April 1999 the respondent ("The Council"), as responsible authority under the Melton Planning Scheme, issued to the appellant a permit to subdivide certain land in Bulmans Road, Melton into 208 lots. The appellant applied to the Tribunal under section 80 of the Planning and Environment Act 1987 ("the Act") for review of certain conditions in the permit, one of which, condition 17, read:
17. The owner must enter into an agreement under Section 173 of [the Act] with the Responsible Authority to provide for services and facilities or contributions towards services and facilities required to meet the needs of population growth from residential subdivision of the subject land to the satisfaction of the Responsible Authority.
Condition No. 17 shall be replaced by the following:
Prior to the issue of the first Statement of Compliance under the Subdivision Act 1988 in respect of the subdivision of the land into residential allotments for sale to the public, the Owner of the land must enter into an agreement with the Responsible Authority under section 173 of [the Act] which, in addition to the usual machinery provision provides that:
* The Owner of the land is to contribute $4175 per lot (at the time a Statement of Compliance is issued for that lot) to the provision of services and facilities to service the residents that will reside on the land in accordance with the Development Contributions Plan - Melton Township August 1999.
* The levy per lot or the overall levy is to be adjusted having regard to the agreed cost of proposed works on Bulmans Road which are part of the said Development Contributions Plan.
* If the Development Contributions Plan - Melton Township - August 1999 is approved and incorporated into the Planning Scheme, there is a mechanism for repaying or topping up, as the case may be the Owner's contribution provided that the top up cannot be required after the issue of a Statement of Compliance for the subdivision of the land into residential allotments for sale to the public."
6. Her Honour found, notwithstanding the broad power in respect of the inclusion of permit conditions set out at Section 62(2)of the Act, that in the absence of an approved development contributions plan, Sections 62(5) and 62(6) of the Act impose a substantial fetter in relation to conditions seeking monetary contributions for infrastructure works, service or facilities considered likely to be generated or demanded by the subdivision of land. In particular Her Honour found that Section 62(6)(b) prevents the imposition of any condition that provides for a person to enter into a Section 173 agreement requiring them to "pay an amount for" as opposed to actually "providing" infrastructure services or facilities. Her Honour also appears to have accepted the submission by Mr Morris QC - who appeared for the permit applicant - that a condition requiring the payment of moneys towards the provision of "works" as opposed to services or facilities, can only be imposed in relation to specified works which are identified as being required on the land, the subject of the permit, or which are required to be provided to that land - such as a crossover to a road outside the subdivision. Furthermore, such works would need to be funded either entirely by the permit applicant or, if partly by the permit applicant then only provided any remaining cost was to be met by a Minister, referral authority, public authority or the council. In other words not via any combined contribution to be shared with other nearby land owners. It is not clear from Her Honour's decision whether it was put to her that a council may use funds collected from other land owners, as suggested by the Tribunal constituted by Mr Liston in West Melton (Vic) PL v Melton Shire Council (Nos. 1999/078630 and 1999/090233) at paragraph 14. In response to a submission by Mr Morris QC. Mr Liston noted that:
"A municipality may meet its share of the cost through revenue, through loan funds or through funds raised from other land owners ..."
7. Justice Balmford found, with assistance from the Second Reading Speech in relation to the Planning and Environment (Development) Contributions Act 1995 (Hansard Legislative Assembly 4 May 1995 page 1240 and following) that the purpose of that Act - which among other things amended Section 62 of the principal Act and at the same time introduced the development contributions provisions at Part 3B of the principal Act - was to:
"Establish a new system for the collection of moneys to fund relevant infrastructure, and that the new system had been prepared after lengthy and elaborate consideration and consultation. That being so, I would find it to be in the highest degree improbable that Parliament would have intended, by retaining those general words (that is those at Section 62(2)) to authorise a condition on a permit providing for the collection of moneys by means other than the machinery carefully and precisely established by those two sub-sections (Sub-sections 62(5) and 62(6))."
8. In other words the Court accepted that contributions from more than one land developer towards the provision of works, services or facilities (as opposed to their actual provision) could only be required via an approved development contributions plan.
9. The Shire of Melton, in common it seems with a significant number of other Victorian municipalities, does not have an approved development contributions plan as now provided for at Part 3B of the Act. It has only a draft development contributions plan prepared by consultants Spiller Gibbon Swan. On 12 August 1999 it formally adopted the draft as policy to be applied throughout the Melton township. As stated at paragraphs 36 and 37 of my statement of reasons in respect of my original consideration of this matter:
"36. The DCP was formally adopted by the Shire "as policy to be applied throughout the Melton township area" at a special Council meeting on 12th of August 1999, a few days prior to the date originally set for the hearing of this application. At the time of adopting the plan as policy the Council also resolved:
"That a further report be presented to Council after the delivery of the current appeal decision to consider the option of incorporating the development contribution plan into the Planning Scheme."
37. As noted in the General Manager's report to the 12th of August special Council meeting, preparation of the plan:
"Followed a two year process of developing and refining an appropriate model for the calculation of development contributions in both the Melton and Melton East areas. During this process, consultation with both land owners and real estate agents occurred, together with the Housing Industry Association and consultants representing major developers ...
During the preparation of the report, a number of developers were consulted on draft versions of the document. Most supported the principle of development contributions (this Council has been imposing the Community and Social Infrastructure Contribution Levy since 1991), however many expressed concern as to the rate that may be levied, on the basis that it may affect land development and sale opportunities."
10. The 18 month transitional period which commenced in November 1995 following gazettal of the Development Contributions Act, and which was intended to allow the former provisions to apply while municipalities prepared, exhibited and formally approved DCPs for their area, expired in May 1997. It was in view of this expiry that I found previously that a "special situation" existed making it appropriate, as I suggested in the written reasons accompanying my original order, to include a condition providing for monetary contributions towards services and facilities notwithstanding that this went contrary to the "schema for DCPs , as set out in the Act and Guidelines, ... to be included and administered via the local planning scheme".
11. At paragraph 22 of Mr Montebello's submission in the latest hearing he advised:
"Since the decision of the Court, Council is now seeking to have a Developments Contribution Plan Overlay introduced into all areas of the municipality that are zoned Residential and in which no permits have yet been issued for residential subdivision. The overlay is envisaged to contain a schedule which will allow Council to grant permits for subdivision if there is a satisfactory agreement for the payment of a contribution between Council and the developer/owner. However, that is not in place at present and it is an interim "fix" as it were until a development contributions plan with the relevant overlay control is introduced into the Scheme."
12. Perhaps not surprisingly in view of the seeming difficulties encountered by many councils in the preparation of DCPs - especially following the decision of Her Honour - the schema for development contributions plans is again being reviewed by the Department of Infrastructure - this is the third time in 10 years. At paragraph 3.5 of his submission Mr Bartley, referring to the status of the Melton DCP, queried whether the Shire had been led to consider abandoning the amendment process required to introduce its DCP, because of this latest review. He went on to advise that:
"It is understood that the draft final report of that review recommends that Councils have three options for the implementation of a DCP. These are (in summary) the adoption of a set rate (understood to be around $1,800 per lot); the preparation of a DCP using adopted standards and rates of provision; or, a full DCP based on specific calculations related to the area in question."
13. The decision of Justice Balmford refers to the judgment of Stephen J in Spurling v Development Underwriting [1973] VicRp 1; [1973] VR 1 at 4-5 where His Honour considered the question of the severability of a condition and in which he states that the decision of the House of Lords in Kent County Council v Kingsway Investments (Kent) Limited [1971] AC 72; [1970] 1 All ER ;70, is authority for the severability of a condition.
14. Mr Montebello, noting that Section 85(1)(g) of the P & E Act asks whether "the permit should not or would not have been granted without the condition" submitted that this must be taken to be a specific test that is now enshrined in the Act itself. He nevertheless accepted that Spurling was useful and I agree that both it and another other case referred to by Mr Bartley, namely the decision of the Supreme Court of Victoria in Crighton v City of Moorabbin [1992] VR 2 have relevance.
15. In Kent County Council the majority view of the Law Lords (with Lord Reid and Lord Upjohn dissenting) was that a condition limiting the time within which detailed plans could be submitted in relation to an outline planning permission - but which failed to make explicit provision for an appeal to the relevant Minister - was not ultra vires. As a separate issue their Lordships were required to also decide whether in the event of the condition having been found to be ultra vires, it would have been severable. The majority view, again with Lords Reid and Upjohn dissenting, was that the condition in question was not severable and that if it had been found to be ultra vires the whole of the permission would fall with the condition.
16. Lord Morris of Borth-y-Gest, with whom Lord Guest and Lord Donavan agreed, made the following observations about matters to be had regard to when deciding about the severability of a condition:
"There might be cases where permission is granted and where some conditions, perhaps unimportant or perhaps incidental, are merely super imposed. In such cases if the conditions are held to be void the permission might be held to endure just as a tree might survive with one or two of its branches pruned or lopped off. It will be otherwise if some condition is seen to be a part, so to speak, of the structure of the permission so that if the condition is hewn away the permission falls with it. In his judgment in Hall &: Co Limited v Shorehan-by-Sea Urban District Council [1964] 1 WLR 240, 251-252 Willmer LJ pointed to the contrast between a case in which one or two trivial conditions might be held to be ultra vires (where it would be difficult to justify saying that the whole permission failed) and a case in which conditions are "fundamental to the whole of the planning permission" in which case the planning permission would fail. In the same case Pearson LJ (as he then was), differentiated, at p.261, between conditions which are "essential, or at least important," and those which are "trivial or at least unimportant".
On this issue I am in agreement with the conclusion reached by the learned Judge and by Lord Denning MR. If in 1952 and 1953 the points had occurred to the respondents and if they or anyone else had persuaded the appellants (the Kent County Council) that Condition (ii) was invalid all the indications are, not that the appellants would have abandoned a time condition, but that they would have insisted on one while so phrasing or redrafting its wording as to meet the somewhat technical points that have now for so many days claimed the attention of the courts. I agree with the Learned Judge and with Lord Denning MR, that the appellants considered that a time condition was of fundamental importance and I agree that if Condition(ii) is void it cannot be deleted so as to leave the permission (subject to the other conditions) still subsisting."
17. In addition to agreeing with Lord Morris, Lord Guest added the following observations:
"It would, in my view, be a very surprising result for the law to reach, that although the planning authority had given outline planning permission which was to expire at the end of three years, unless details were approved by them within that time, yet because a time limit was ultra vires unlimited planning permission remained to be exercised at any time in futuro upon the approval of the reserved matters. This may, of course, be a result of the authorities that I should not, without considerable hesitation reach such a conclusion. Planning permission is an animal sui generis not to be compared with licenses and similar permissions. It seems to me that planning permission is entire. If a condition as to its grant flies off owing to its invalidity, the whole planning permission must go; and it is impossible to separate the outline permission without the time limit from the grant. The good part is so inextricably mixed up with the bad that the whole must go."
18. Lord Reid and Lord Upjohn's findings as to appropriate tests for severability, whilst leading them to findings which went contrary to the majority view, were nevertheless found helpful in both Spurling and Crighton and I therefore set them down for completeness. It should be noted however that whilst all of their Lordships agreed that trivial elements could be severed, Lords Upjohn and Reid, because the condition in question had something of a collateral quality to it, rather than going more directly to the actual development approved in the outline permission - were prepared to find that the permission could stand absent the time limit condition.
"Suppose that a planning authority purports to impose a condition which has nothing whatever to do with planning considerations but is only calculated to achieve some ulterior object thought to be in the public interest. Clearly, in my view the condition should be severed and the permission should stand. But suppose, on the other hand, that a condition thought invalid because ultra vires or unreasonable, limits the manner in which the land can be developed, then the condition would not be severable, for if it were simply struck out the result would be that the owner could do things on his land for which he never in fact obtained permission, and that would be contrary to the intention of the statute."
20. Stephen J in Spurling summarised Lord Upjohn's findings as follows:
"Lord Upjohn, at (AC) p.113 adopted as a test of severability whether or not the invalid condition `went to the root of the planning permission itself' or, on the contrary, was `purely collateral and could be altered without affecting the actual grant of the permission'. He concluded (at AC) p.114 that in the instant case a particular condition could be severed `without doing any violence to the language that remains and without affecting in any way the substance of the grant permission itself so that the grants of permission were valid, the respective conditions ... were invalid but the original grants of permission remain valid and effectual ..."
21. In Spurling, Stephen J considered the validity of a condition precedent to the issue of a permit authorising the development of what is now known as Highpoint Shopping Centre. The Tribunal in determining to grant a permit subject to conditions couched its decision as follows:
"The decision of the Tribunal is that the appeal by Westfield Corporation Pty Ltd and others as objectors is disallowed and it is directed that, subject to the consent of the Governor in Counsel to the sale of the land being first obtained, a permit shall issue subject to the conditions set out on the Notice of Determination."
22. The Court found that the condition precedent to the issue of this permit went beyond the powers conferred on the Tribunal under Section 22(1)(b) of the former Town and Country Planning Act 1961 (the equivalent provision to Section 85(1)(b)(ii) of the current Act). His Honour found that in the particular circumstances of that case and having regard to the tests enunciated in Kent County Council, that prior consent of the Governor-in-Counsel to the sale of the land is a condition which could "readily be severed". He went on to say:
"Indeed I think that this is a quite clear case; the condition is one which in a sense did, as Mr Gifford contended, no more than state what was in any event the position in fact, namely that the permission could not be given effect to until such time as the Governor-in-Counsel approved of the sale of the land by the City of Essendon. It follows, therefore, that the severance of the condition cannot affect in any way the operation of the determination of the Tribunal and this is therefore a case where severance will not alter the substantial intended effect of the Tribunal's determination."
23. In Crighton Ashley J found that a condition requiring the permit applicant to "remain in charge of the proposed use and (be) himself working on the premises", was both invalid and severable. His Honour found that while in certain circumstances a permit could be tied to a particular person, in order to ensure the proper operation of the use, the condition in question was not aimed to this end. Rather it had been limited to a particular person in order to impose a time limit on a non-conforming use. Such a motive was found not to be "reasonably capable of being related (in that particular case) to the implementation of planning policy". Although the concept of a time limit for non-conforming uses was found to have some prospect of validity in the right circumstances, His Honour did not consider that this was such a circumstance. At page 185 - 186 His Honour made the following findings in relation to the severability of that particular condition:
"In my opinion it should be concluded that the responsible authority would have granted the permit, had it not considered it possible to include Condition 6. The authorities should not be able to rely upon a consideration which was outside power as a basis for saying that it would not have granted the permit. As Lord Reid said in Kent County Council (supra) at page 90:
"Suppose that a planning authority purports to impose a condition which has nothing whatever to do with planning considerations but is only calculated to achieve some ulterior object thought to be in the public interest. Clearly, in my view, the condition should be severed and the permission should stand."
So far as Condition 6 might be answered to have a temporal component, it is by no means clear that this was ever a discrete intended subject matter of the condition - even assuming that a condition as to time made personal to these appellants could otherwise be sustained. The intertwining of the personality of the appellants, restrictions on user and time is such as does not allow, in my opinion, a conclusion that the permit would not have been granted, absent irrelevant considerations. Indeed, I consider that a permit would have been granted."
24. The decision in Crighton was made after the coming into operation of the Planning and Environment Act 1987. It is clear from Ashley J's decision that whilst having regard to their Lordships reasoning in Kent County Council he placed their considerations into the context of Section 85(1)(g) in finding that the permit in that particular instance _"_would have been granted" without the invalid condition.
25. In approaching the question of whether a permit would or should have been granted, Ashley J. followed the approach adopted by Lord Morris of Borth-y-Gest in Kent County Council and asked whether the Responsible Authority would have granted the permit had it not considered it possible to include the condition. Lord Morris found that the Authority would have insisted on a time condition but would have redrafted its wording in order to overcome the invalidity problem. He found, in contradistinction to Lord Reid, that a time limit on an outline development permission could be a relevant planning consideration notwithstanding the fact that it would not meet the test suggested by Lord Reid of restricting the way in which actual development takes place. Lord Morris said:
"It seems to me that development may be impeded and purposeful planning may be thwarted if without restrictions of time there are outstanding permissions which are permissions in principle but which give no prospect of resulting in development. What is potential in regard to some land could defeat what could be practical and urgent in regard to other land."
26. The case put by Mr Bartley for the applicant for review was that Condition 17 does not go to the root of the planning permission itself and that given the fact that it does not limit the manner in which the site can be used or developed - being more related to implications arising out of its use and development - that it should be found to be severable.
27. Adopting the test put by Lord Reid of whether the condition limits the manner in which the land can be used or developed, Mr Bartley argued that Condition 17 did not alter or affect the subdivision of the land in any way. He submitted that it meets a majority of the relevant decision guidelines at Clause 65 of the Scheme and that the grant of a permit can be taken as proof of that fact. He noted also that the permit applicant would be providing works on and to the land including the widening of Bulmans Road and the connection and upgrading of stormwater drainage to the south and that this was contribution enough.
28. Relying on the evidence of Mr Haratsis - which was not disputed by Mr Montebello - Mr Bartley contended also that there could be no suggestion that development of this land was premature. It is logically located in relation to other subdivided land and could not be described as a subdivision which might be said to "jump the gun" of the development front at this fringe of the Melton township. He noted in particular that the Melton Structure Plan, which forms part of the Local Policy Framework at Clause 21.04, shows this land being within an area for conventional residential development in the "short/medium term".
29. Finally, again relying on the expert opinion of Mr Haratsis, Mr Bartley argued that the Melton Township Development Contributions Plan as presently drafted is fundamentally flawed, most notably in relation to what Mr Haratsis regarded as a failure to demonstrate a "temporal nexus", that is to say a reasonable time frame between the payment of a contribution towards services and facilities and their actual provision. This, taken with the Council's seeming reluctance to embark upon the process of having its Development Contributions Plans approved were, he submitted, relevant considerations to have regard to in determining whether the permit should have been granted without Condition No. 17.
30. By contrast, Mr Montebello contended that a permit would not or should not have been granted if it had been known that a condition such as Condition 17 was ultra vires in the absence of an approved development plan. In his submission the a permit should have been refused pending approval of a DCP or, as is now being mooted, an "interim fix" amendment. Because there is no overriding need for this land to be subdivided - there being sufficient subdivided land available in Melton township to meet demand for some time - it was his submission that it would have been open to find that a permit ought to be refused pending approval of a DCP or "fix it" amendment.
31. Mr Montebello also contended that the current status of the Melton Township DCPs, the basis of those DCPs and the actions of the Council to have them approved for incorporation into the Planning Scheme were irrelevant considerations given that the question to be asked is whether a permit would have been granted if it had been known that Condition 17 was ultra vires. The Council may well have been more active in getting its DCP approved if it had been aware that its chosen avenue for obtaining contributions was ultra vires.
32. Finally, he submitted that the Planning Policy Framework as outlined in detail in my previous determination, is very clear about the importance of subdividers being required to contribute equitably towards the provision of the works, services and facilities that will be required by occupants of these future subdivisions at the fringe of Melton township.
33. Relying on the evidence of Mr Spiller, which in a theoretical sense at least was not contested, Mr Montebello argued that municipal rates will rise over time if subdivision in Melton township, including in this north-western sector, is allowed to proceed in the absence of development contributions. This is because any social and physical infrastructure required by this - and presumably any other subdivisions approved with a similar invalid contribution condition - as well as other subdivisions that may be lodged prior to an approved DCP, will require funding from other sources. Most notably this would be from existing ratepayers many of whom may have already paid their equitable, up-front share, via earlier, valid development contributions.
34. Mr Montebello suggested that even if it could be said that the relative loss from not obtaining a contribution in relation to this particular subdivision would not be substantial, this does not overcome the wider equity and accountability issue identified by the policy framework. The decision to grant a permit was based upon an understanding that contributions could be sought. A permit would not have been granted he contended if it had been appreciated that infrastructure generated by this particular subdivision would need to be subsidised to a greater degree than others. Accordingly in the absence of any overwhelming need for the land to be subdivided, approval should have been held over pending incorporation of the DCP.
35. This has not been an easy matter to decide. Just as the decision of Her Honour Justice Balmford will have had wider implications than the permit which is the subject of these proceedings, so too might this decision. My first conclusion, having regard to the decision in Spurling and the reasoning of Lord Morris of Borth-y-Gest in Kent County Council, is that Condition 17 could not be described as a trivial, incidental or a merely superimposed element of the permit granted in this case.
36. I accept that deletion of Condition 17 would not limit the manner in which the land could be subdivided. For example, it would not, as a result of its removal, allow the permit applicant to do things on the land for which he had not obtained permission. However, having regard to the reasoning of Lord Morris in Kent County Council I am persuaded that Condition 17 has something of the quality of the time limitation on the outline development permission being reviewed in that case. It may not affect the manner in which the land is to be developed but its deletion would have implications for the "purposeful planning" of Melton township which might well be "thwarted" without its inclusion.
37. I am persuaded that if it had been put to me or the Responsible Authority that Condition 17 was ultra vires, a permit would not and indeed should not have been granted without its inclusion. The State and Local Planning Policy Framework, most notably at Clauses 13, 18.12 and 22.04 refers to the need to ensure the equitable and timely provision of physical and community infrastructure through the use of development contributions. The Shire of Melton, in what turns out to have been a mistaken belief that development contributions could be obtained via a Section 173 agreement, was nevertheless acting consistently with the Policy Framework by seeking to ensure the equitable and timely provision of infrastructure which it considered would be demanded in part by subdivision of this land, and there can be no dispute that there will be demands. The question has always been how and when these demands should be met. These however are not matters that I must determine.
38. The fact that the Shire had not vigorously pursued the approval of its development contributions plan needs to be balanced against the fact that it sincerely believed that contributions could be obtained via a Section 173 agreement and indeed so have many other responsible authorities including, according to Mr Montebello, the Minister for Planning. The Shire's decision to require a contribution via such an agreement cannot be said to constitute a decision "calculated to achieve some ulterior object thought to be in the public interest", given that the Planning Policy Framework clearly directs planning authorities to obtain contributions in order to ensure that urban development is properly staged and controlled, with infrastructure provided in "an efficient, sensible and timely manner",
39. I accept Mr Bartley's argument that there can be no basis for arguing that subdivision of this land is premature. It is clearly and logically ready for subdivision. Indeed, as I have already noted, Mr Montebello did not contest this point. Rather, he argued that there is no overwhelming "need" for the land to be subdivided at this time and that this being the case it is open for me to find that a permit should be refused pending approval of a development contributions plan or some interim measure.
40. Whilst I accept that for the most part this subdivision and the Council's decision to grant a permit for subdivision can be said to be consistent with the decision guidelines at Clause 65 of the Planning Scheme, I think it important to note that at Clause 65(2) one of the relevant matters to have regard to when deciding whether or not to grant a permit to subdivide land is:
"The availability of subdivided land in the locality, and the need for the creation of further lots."
41. Mr Haratsis' evidence was I think conclusive of the fact that there is no overwhelming need for this land to be subdivided at this time. At page 5 of his witness statement he states that a development time frame close to 10 years can be anticipated for this, on his own admission, quite small, 208 lot subdivision. This averages out at sales of less than 20 lots per year. He accepted that with the extensive number of lots available in East Melton, the increases in rural residential lots and the advent of "resort style living (lots) eg. 1500 lots at Eynesbury Station", that development on this fringe of Melton township is likely to be "relatively modest" for at least another 15 years.
42. The draft DCP for Melton Township's north-west sector, within which the subject land is located, also anticipates relatively modest development for the next 10-15 years, with dwelling starts peaking between 15 and 20 years. So too does the Victoria in Future table appended to Mr Haratsis' witness statement. This table also confirms the substantial levels of growth anticipated for East Melton in the next 15 years and the fact that this is likely to terminate abruptly after 2016. It is only at this point in time that the table shows substantial growth commencing in the balance of Melton (including the township). Accordingly it can be suggested that there is unlikely to be any overwhelming need for lots in this part of Melton for some time.
43. In the absence of any overwhelming need for further subdivision - albeit that this particular parcel of land represents a logical next step in development at the fringe of Melton township - I accept that it would have been open to find that a permit should not be granted unless or until a contribution towards the services and facilities likely to be demanded by future residents of this land could be sought from the permit applicant, consistent with the objectives of the Urban Development Local Planning Policy at Clause 22.04 of the Scheme.
44. It is my conclusion therefore that Condition 17, or what it sought to achieve, was an important, indeed "fundamental" element in the decision to grant a permit in this case. It was not a collateral or trivial part of the decision to grant a permit. Accordingly, in the absence of any overwhelming need to subdivide the land at this point in time I am persuaded that without Condition No. 17 a permit would not and should not have been granted. The permit must fall without the condition and accordingly I will cancel the permit.
Curry
Melton SC [2001] VCAT 1602
Permit No. P2483/98, issued by Melton Shire Council on 30 April 1999 is cancelled (see Order and [44]).