Town planning - Rural land - Subdivision application to divide small block into two lots - Extensive policies requiring justification for subdivision - Family reasons put forward by applicant - Whether hardship - Approval by local government contrary to its own policy - Most neighbouring properties not pursuing directly agricultural pursuits - Extent of discretion of Tribunal - Consistency in administrative decision-making

Town Planning and Development Act 1928 (WA), s 61(3)

Bakker and City of Nedlands [2005] WASAT 106

Edwards v Western Australian Planning Commission [2003] WATPAT 127

Hickling v Western Australian Planning Commission [2003] WATPAT 92

Knight v Western Australian Planning Commission [2003] WATPAT 6

Notte v Western Australian Planning Commission [2003] WATPAT 113

1 This application for review deals with the refusal by the regulatory authority, the Western Australian Planning Commission (the WAPC) to give its consent for the owner of a small parcel of rural land to subdivide his land into two lots. Mr Fehlauer (the applicant) owns the land and wishes to do so essentially for family reasons. The WAPC has a number of policies which make such subdivisions difficult, with the intent that rural land will not be subdivided except for very good reasons, and then in a consistent manner. The applicant failed to satisfy either the WAPC or on review the State Administrative Tribunal (the Tribunal) that he had sound or sufficient reasons to permit the subdivision.

2 The land the subject of this review is Lot 5 Fox Road Northam, comprised in Certificate of Title Vol 1336 Fol 140 (the subject land). The applicant, Mr Fehlauer, is, with his wife, the joint owner of the subject land.

3 The subject land comprises a total area of just under 9 hectares. It is located approximately 6 kilometres west of the Town of Northam. The Great Eastern Highway abuts the "northern" (strictly NW by N) boundary of this rectangular-shaped land. Fox Road (which is unsealed) is the "western" boundary. Beyond Fox Road, further to the west, is a cattery or kennels; to the east of the subject land is a timber products operation. Further south, near to the subject land's boundary, is the Kalgoorlie to Perth water pipeline, and immediately beyond that is a speedway on a public reserve. To the south-west is land reserved for military purposes.

4 Apart from the speedway and the military land (which are zoned for "Public Purposes"), all of the surrounding land (apart from any public highway or road) was originally zoned "Rural 3" under the former local planning instrument. Some of these "neighbours" have, generally speaking, similar sized blocks to that of the applicant's land.

5 Mr Fehlauer proposes to subdivide the land into two approximately equal lots, each comprising about 4.4 hectares. The subject land would be bisected along an "east-west" alignment (ie, from Fox Road on the western side to the sawmill side on the adjoining property towards the east).

6 The proposed northern lot has a shed and an existing house erected upon it. The proposed southern lot includes an existing dam; a new residence (a demountable) would be built on the south-eastern corner of the second lot. The subject land is described as "predominantly cleared and reasonably flat". The application for subdivision approval stated that the proposed use of the two lots was for "hobby farming purposes". The main motivation for the subdivision is stated to be for family reasons. These matters will be discussed in more detail below.

7 The applicant's subdivision application of November 2004 was refused by the respondent (the Western Australian Planning Commission) in January 2005. The applicant sought a review of that decision by this Tribunal in February 2005.

8 In summary, the grounds for refusal were as follows:

1. The rural zoning of the land is aimed at preserving the land's rural use and density and a subdivision, if permitted, would result in "an unplanned breakdown of land holdings".

2. The subdivision would either be inconsistent with the various planning and policy instruments or not supported by any local planning policy or local strategy (see below).

3. There was insufficient factual material available "to demonstrate that the land [was] capable of closer subdivision and associated development" in the manner proposed by the applicant.

9 The following summary of the relevant planning framework is largely taken from the submissions of the respondent. The provisions referred to below are not disputed by the applicant. (Some facts, which are not disputed by the applicant, have been interpolated in this section of these reasons for convenience of reference.)

10 As has been mentioned, the subject land was zoned "Rural 3" under the Shire of Northam Town Planning Scheme No 2 (TPS 2). Clause 6.6.3 of that scheme provided that:

"Having regard to the zone's existing agricultural use and the landscape and environment significance of the rural areas, [the Shire] will not in general support further breakdown of lots except where this may be desirable or necessary to ensure the:

(a) Protection of the natural and the rural environment.

(b) Acquisition of additional reserves, particularly the area of Bobakine Hills."

11 It is agreed that the proposed subdivision had not been submitted for the purposes of protection of the natural and rural environment or for acquiring additional reserves in the Bobakine Hills locality, in accordance with this clause.

12 Since the hearing, the Shire of Northam has prepared a new town planning scheme (TPS 3) which is now in force. Under TPS 3 the subject land is zoned "Agriculture - Local". The objective of that zone is:

"To provide for horticulture, intensive agriculture, agroforestry, local services and industry, buffer areas for extractive industries, tourist uses and conservation and landscape qualities in accordance with the capability of the land."

13 Clause 5.1.7.1 of TPS 3 provides that development in the Agricultural - Local zone must comply with the objectives of the zone.

14 The subject land is also subject to a local planning instrument, namely the Shire of Northam Local Planning Strategy (LPS). The LPS has been endorsed by the respondent. The respondent summarises the LPS as follows:

"[It provides] an overall subdivision strategy for the Shire for the next 10 to 15 years. The LPS reflects the requirements of the respondent's policies in that it expresses the vision of the Shire and identifies proposals for future development of the district including:

• subdivision and development criteria for agricultural land, and strategy for settlement growth;

• identification areas for closer settlement in rural areas, and to provide a guide for the future land use, zoning, subdivision and development within those areas; and

• determining the preferred pattern of agricultural land use and providing a guide for future land use, zoning, subdivision and development within areas of agricultural significance.

The subdivision strategy seeks to limit subdivision, particularly rural residential subdivision, in areas surrounding the Wundowie, Bakers Hill, Clackline and Grass Valley town sites. Subdivision in these areas will only be supported once the land has been appropriately zoned, that is, to 'Rural Residential' or to 'Rural Small Holdings'."

15 It is agreed that the subject land is not located within these specified town areas. The subject land is in fact located within the Avon West Planning Precinct,

"... where subdivision is only supported to a minimum lot size of 50 hectares and subject to certain planning criteria [which] provide for the long term agricultural productivity of the precinct and protection and management of the precinct's environmental attributes. The criteria also require detailed site analysis and assessment to be undertaken which demonstrate that the land is of fair to very high capability of sustaining the proposed development and use."

16 No such "detailed site analysis and assessment" has been undertaken by the applicant. As this clause indicates, a common theme running through these planning instruments is the need to demonstrate the sustainability or capability of the land. This is a matter that will be returned to below.

17 Statement of Planning Policy No 1 - State Planning Framework (SPP No 1) is an overarching policy which the respondent, and on review, this Tribunal must have appropriate regard to in making subdivision decisions. SPP No 1 includes reference to certain relevant written sub-policies, including Statement of Planning Policy No 2.5 - Agriculture and Rural Land Use Planning (SPP No 2.5), Policy DC 1.1 - "Subdivision of Land - General Principles" and Policy DC 3.4 - "Subdivision of Rural Land". The respondent has drawn attention to the extensive public consultation that took place before the adoption of SPP No 2.5.

18 The main policy objectives are stated in cl 4 of SPP No 2.5 and are said by the respondent to be "drawn from the following fundamental principles of rural planning", namely that:

• the state's priority agricultural land resources should be protected;

• rural settlement opportunities should be provided if they are sustainable and of benefit to the community;

• the potential for land use conflict should be minimised; and

• the state's natural resources should be carefully managed.

19 The respondent draws attention to the fact that SPP No 2.5 "is to be read in conjunction with the respondent's Policy DC 3.4 - 'Subdivision of Rural Land' ". Clause 3 of SPP No 2.5 provides that:

"The Commission will use this policy and Policy DC 3.4 - Subdivision of Rural Land ... as the basis for determining applications for subdivision of rural land."

20 As is mentioned above, Policy DC 1.1 deals with "general principles" that will be applied by the respondent, and on review by this Tribunal, in determining applications for the subdivision of land. Clause 2 of DC 1.1 sets out certain policy objectives which include ensuring:

• that all lots created have regard to the provisions of the relevant local government town planning scheme;

• that the subdivision pattern is responsive to the characteristics of the site and the local planning context; and

• that the subdivision is consistent with the orderly and proper planning and character of the area.

"3.8.1 [The respondent] considers that all new lots should be physically capable of development for their intended purpose. Prospective purchasers of such lots should be reasonably assured that the lot is suitable in physical terms for development, and that there is a degree of assurance that the lot will so remain."

22 Finally, specific reference must be made to Policy DC 3.4 - Subdivision of Rural Land. The purpose of DC 3.4:

"... is to provide a framework for the subdivision of rural land to achieve the objectives of SPP No 2.5. DC 3.4 provides a role for town planning schemes in rural land use planning, establishes guidelines for the preparation of such town planning schemes and local planning strategies, and sets out specific principles and criteria to be used in the respondent's determination of applications for the subdivision of rural land."

23 Importantly, cl 3.1.1 of Policy DC 3.4 provides "a general presumption against subdivision of rural land unless the subdivision is specifically provided for in a Town Planning Scheme, an endorsed Local Planning Strategy or an endorsed Local Rural Strategy." The respondent notes that Part 6 of Policy DC 3.4 lists other factors that may be considered in determining an application to subdivide rural land, "including impact on agriculture, lot sizes, land capability, land use and rural amenity".

24 Mr Fehlauer said that although he had been "born and bred in Northam" he was only a "hobby farmer" without an Australian Business Number (ABN) and therefore not involved in broad acre pursuits. He was not "living off [of the] land". He said that the "people around him are not farmers".

25 That is, Mr Fehlauer brought to the Tribunal's attention that his "neighbours" were a diverse group engaged essentially in non-traditional rural pursuits (at least relative to agriculture). He submitted that the surrounding neighbours to the south, west and east were located on smaller lots than 10 acres. Thus, he argued, the precedent had already been set for smaller lots. He argued that he ought not be restricted in a way that they had not been, that is by his treatment as if he was breaking up (by subdividing) agricultural or rural land.

26 He noted that the Shire had given him approval to subdivide into two 10 acre lots and that his local MLA (Mr Max Trenorden) had written him a letter of support.

27 Finally, Mr Fehlauer said that there were "special circumstances" in his case, and that "compassion" (a reference to his family circumstances) and "common sense" dictated approval. He said:

"This is not a development subdivision. It is for my family when I retire so that my seven children will have less problems when it comes to my will distribution."

28 Apart from the three general reasons set out above for rejecting the subdivision, the respondent specifically argues that:

1. The creation of two 4.4 hectare lots would be contrary to the LPS, and further: "The subdivision application proposes lots below the prescribed 50 hectare minimum and has not addressed the criteria set out in the LPS."

2. Subdivision of the subject land would not be consistent with the achievement of the policy objectives and the provisions of Policy DC 3.4; is contrary to SPP No 2.5 "and should not be supported in the absence of a proper basis for departing from these policies".

3. It has not been demonstrated that the subject land is capable of development for, in effect, special rural purposes and that "this constitutes a significant impediment to approval of the proposed subdivision".

4. The applicant has "submitted nothing which demonstrates how the subdivision would impact on the current or future productivity of the subject land; whether the smaller lots are capable of sustaining agriculture; or whether uses resulting from the subdivision would be compatible with neighbouring uses and vice versa".

5. A subdivision would "create the opportunity for additional non-rural development such as additional housing. This could impact on the existing rural landscape and is contrary to the intent of the Scheme, which aims to retain larger lots in this locality".

6. Finally, the respondent noted that the applicant's proposal for the location on the land of a demountable home "looked like" a non-agricultural purpose.

29 In reply to the major limbs of the applicant's case, first, in its written evidence, the respondent dealt with the applicant's reliance on the Shire's approval to subdivide as follows:

"44. The Shire of Northam did not provide the Respondent with any justification or context for its recommendation, or an explanation as to why it provided a recommendation which is clearly inconsistent with its existing town planning scheme, proposed town planning scheme and local planning strategy, and the Respondent's policies.

45. The Respondent is not bound to follow the recommendation of a local government, and may approve or refuse to approve an application for subdivision regardless of the local government's recommendation. In this case, the local government provided a recommendation which was contrary to the provisions of its operative town planning scheme, as well as those of its draft town planning scheme [TPS 3] and local planning strategy. The local government did not provide any explanation as to why the Respondent should depart from its established policies to approve the proposal.

46. The planning framework has been established as part of a recently-completed [sic] comprehensive planning exercise undertaken by the Shire. The exercise included consultation with relevant stakeholders, including members of the community. To depart from this framework would undermine the efficacy of these planning tools and jeopardise the orderly and proper planning advocated by the Shire for this locality and its district in general."

30 Secondly, in reply to the applicant's claim that there are "six lots in the locality surrounding the subject land which are four to 12 acres in size", the respondent says:

"47. It is acknowledged that there are several lots in the surrounding locality which are similar in size to those proposed by the Applicant. These lots were created prior to the introduction of the current planning framework. The fact that there are other small lots in the area should not be used as a binding precedent for approval to the subdivision. If it was, that would mean similar subdivisions in the Shire of Northam would have to be approved."

31 The respondent gave as its "best estimate" in its oral evidence that there had been no smaller subdivisions "in the past 25 years".

32 In Hickling v Western Australian Planning Commission [2003] WATPAT 92 the former Town Planning Appeal Tribunal said (at [23]):

"The ... contention that the [subject] land, if subdivided, is to be retained in primary production is acknowledged but future changes in land ownership, for whatever reason, may result in changes in land uses and smaller lots would make it more likely that non-productive uses will occur. Retaining the land in a holding of the present size [there, albeit 260 ha approximately] would reduce the risk of a loss of the land to productive agriculture."

33 Also in the same case the former Tribunal made some general observations that are equally applicable to this review (at [17] - [18], emphasis added):

"The objective of the [local] Scheme is to ensure that high quality land is retained for primary production and to regulate uses and developments which conflict with that intent ... The Commission's [policies carry] a presumption against the subdivision of land so zoned other than in special circumstances on the basis that ad hoc subdivisions run counter to the protection of agricultural land resources."

34 As to a claim for subdivision on hardship grounds, the former Tribunal in that case made the following comments that are relevant to this review (at [36] - [38]):

"With respect to personal hardship, [s 61(3) of the Town Planning and Development Act 1928 (WA)] provides that [sic] Tribunal may have regard for such claims provided that it is satisfied that to do so will not affect the application of sound planning principles ... The test that consideration of this ground must pass is that it would not affect the application of sound town planning principles. Those principles [discussed in that case] lead to a very firm conclusion that the proposal should not be permitted to proceed and so the Tribunal is prevented by the provisions of the legislation from allowing the grounds of hardship to influence the decision in this case."

35 See also: Notte v Western Australian Planning Commission [2003] WATPAT 113 and Edwards v Western Australian Planning Commission [2003] WATPAT 127, where similar views are expressed. Cf Knight v Western Australian Planning Commission [2003] WATPAT 6 where expert evidence was led on, amongst other things, the poor agricultural sustainability of a 9 hectares block fully vegetated only with native species. The Tribunal, by majority, allowed the review.

36 Against this background, the respondent's case must succeed for reasons that may be shortly stated.

37 First, the general intent of the relevant rural subdivision instruments and policies, to which detailed reference has been made above, is reasonably clear (as appears from the unchallenged evidence here, and the statements of principle of the former Tribunal set above). Further, they are capable of application to and were obviously intended to deal with land such as the subject land, even if it be a relatively small holding at just under 10 hectares. They would equally apply to any of the applicant's neighbours who sought to subdivide their land. In addition, they have been created upon a rational basis, and such policies have been consistently applied (see, eg, the former Tribunal's decisions referred to above). And, even if the Tribunal disagreed with their wisdom, the Tribunal would be in error to depart from them merely because it differed in its opinion (unless some fundamental error were revealed); moreover, to do so would be inconsistent - again, for insufficient cause - with decisions of the former Tribunal. On the need for reasonable consistency in the administrative decision-making process see: Bakker and City of Nedlands [2005] WASAT 106 at [25]- [27].

38 Secondly, there is no relevant local policy or strategy that would relevantly permit a departure from these standards. To the contrary, as is demonstrated above, such local instruments are complementary to and supportive of the respondent's policies. The fact that the local government for the area disregarded one of their own local instruments is not a reason for this Tribunal to make, with respect, the same misjudgement.

39 Thirdly, the applicant has declined to provide, despite invitations, any evidence of the subject land's precise agricultural sustainability and capability. The preponderance of evidence available to the Tribunal suggests that the land can sustain agricultural pursuits to the requisite degree and therefore prima facie it attracts the attention of the respondent's retention policies set out above.

40 Finally, even if relevant "hardship" were to be found in the circumstances of this case (which is, with all respect to the applicant, doubtful) those circumstances do not in any event override the sound planning principles referred to above. To come to the opposite conclusion would also be inconsistent - again, for insufficient reason - with decisions of the former Tribunal.

41 For these reasons the applicant's application for review must be dismissed.

I certify that this and the preceding [42] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

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MR P McNAB, MEMBER