RESPONDENT/PERMIT APPLICANTS: Masten Bennett and Associates Pty Ltd.

Medium Neutral Citation [2003] VCAT 631

With respect to planning permit application no. 326/2001/01P, the Responsible Authority's decision to grant a permit is set aside. A permit must not be granted.

Mr P Carapellotti, Planning Consultant, appeared for the Responsible Authority.

Mr M Townsend, barrister, directly briefed, appeared for the applicant for review.

Ms N Bannister, solicitor with Blake Dawson and Waldron appeared for the permit applicants.

1. This was an application under Section 82 of the Planning and Environment Act 1987 against the Responsible Authority's decision to grant a permit with respect to Permit Application No. 326/2001/01P. The permit application seeks permission to use each of the lots that comprise the property known as 395 Chapel Road Nutfield for the purpose of a dwelling.

2. The permit application was lodged with the Responsible Authority on 23 May 2001. The Responsible Authority subsequently required notice of the application to be given under Section 52 of the Planning and Environment Act 1987. In response, four objections were lodged with the Responsible Authority, including one from the applicant for review. Mr Carapellotti summarised the grounds of objection as follows in his submission:

* The amount of planting proposed by the applicant is not sufficient for a property of this size. All planting should be undertaken prior to the planning permit issuing.

* All erosion problems should be addressed prior to the issuing of a planning permit. This problem should not be passed on to future owners.

* The rural `general farming character of the area be retained.

* The proposal will have an adverse effect on the environmental values of the area through increased road kill and disturbance.

* Proposal will result in a substantial increase in the amount of dust generated by traffic on Chapel Road.

3. Mr Carapellotti also said that some of the objectors stated that they would not object to the proposal if a number of conditions are imposed on the permit. He summarised these as follows:

That the government road on the western boundary of the subject property not be formed and remain in its current state due to concerns about loss of vegetation and privacy.

That the applicant/owners contribute to the sealing of Chapel Road to the east due to the likely increase in traffic.

Council should erect more wildlife warning signs along the road side.

That any vegetation removal from the site be prohibited.

That Lot 13 be made larger in area by realigning the internal road layout while reducing the size of Lot 12. This should be done in recognition of the environmental values of Lot 13 being alongside Arthur's Creek.

4. The proposal was also forwarded to the Responsible Authority's Environmental Planning Unit, Infrastructure Development Section and Environmental Health Department for comment. Mr Carapellotti summarised their comments as follows:

No objections subject to condition regarding weed eradication and land management.

No objection to the proposal subject to conditions regarding road construction, property access and drainage.

No objection to the proposal subject to a series of standard conditions regarding effluent disposal. Each allotment is capable of containing and treating all waste water.

5. After notice of the application, the Responsible Authority undertook discussions with the applicant and the objectors, however, the matters in dispute were not resolved.

6. On the 17 April 2002, the Responsible Authority received a report form its officers recommending that the application be approved subject to 11 conditions. The Responsible Authority resolved to grant a permit subject to 11 conditions, however some of the requirements set out in the officer's recommendation were not included in the conditions.

7. The application for review was filed with the Tribunal on 8 May 2002. The grounds of the application are as follows:

* The use does not meet the requirements of the RUZ.

* The allotments are below the 40ha minimum in the zone.

* Conditions for planting a 30 metre buffer along the creek and drainage lines have been removed contrary to State Planning Policy (15.01-2)

* Does not provide for sustainable agricultural uses and does not promote effective land management.

* Condition re excision of site (1 b i) is not strong enough to ensure no future subdivision.

8. The permit applicants rely on the following grounds in contesting the Application for Review.

1. The application is not to further subdivide land but to construct dwellings on existing and separate land titles.

2. There is no objection to creating a landscaped buffer along the creek and drainage lines.

3. The application will serve to implement a comprehensive land management framework plan that can best be achieved whilst the properties are in the one family ownership.

4. The application does not establish a precedent for further subdivision as the application is not for a subdivision.

5. Failure to grant a permit as proposed will ultimately lead to fragmented land ownership and loss of an opportunity to implement a co-ordinated and responsible approach to the existing situation.

6. Reliance on a section 173 agreement to prevent further subdivision is an accepted and well recognised instrument for this purpose.

9. The subject land is located on the north side of Chapel Road, Nutfield, about 450 metres from the intersection of Hurstbridge Arthurs-Creek Road. The land comprises 12 adjoining lots and an unmade road that, in combination, create a property with an area of about 104 hectares. The lots range in size about 6.4 hectares (Lot 13) to 9.9 hectares (Lot 5) whilst the road has an area of about 4.22 hectares. The 12 lots and the road are held in common ownership by Ian, Ross and Malcolm MacMillan and are currently used as a farm for grazing cattle. A dwelling exists on Lot 11 whilst all the other lots are used for farming with the only other buildings of any note being hay sheds and a set of cattle yards.

10. Mr Carapellotti described the characteristics of the land as follows:

The property is undulating, with a ridge line running through the middle of the property, generally along the alignment of the un-constructed road. Lot 13 has an area that falls steeply into Arthurs Creek, while Lots 2, 3 and 4 contain gullies which feed into Arthurs Creek. In general, the lots are vacant, with small pockets of significant vegetation, having been used for grazing for some time. Existing vegetation is generally limited to Lots 2, 3, 4 and 13, along the creek and within the gullies. An unsealed access track runs from south to north in Chapel Road. This road provides access to all allotments as well as the existing detached dwelling located wholly within Lot 11.

11. The land is located within a somewhat open rural environment with lots in the area varying in size. Mr Carapellotti pointed out that of the eight lots that adjoin the subject land, five have an area greater than 35 hectares whilst the other three lots range in size from about 2 to 12.5 hectares. These properties are used for a range of purposes including farming, a horse stud with some smaller hobby farms and rural residential uses. The landscape is one largely comprised of open undulating pasture with some pockets of vegetation.

12. I also note that some parts of the gully system through the land have been subject to erosion, particularly through Lots 4 and 5. It would appear that the owners of the property have undertaken some tree planting to reduce the erosion.

13. Mr Patterson set out the details of the proposal as follows in his report:

It is proposed to construct single dwellings on Lot 2, 3, 4, 5, 6, 7, 8, 9, 10, 12 and 13. Lot 11 currently contains a dwelling and therefore is not included in the application.

Vehicle access to the dwellings will be provided from Chapel Lane to the south by constructing a rural standard road within the existing road reserve created in the original subdivision. This road will be constructed and surfaced to the satisfaction of Council's engineering department.

As part of the application it is also proposed to implement an Environmental Landscape Plan that will serve to:

* Revegetate parts of the properties with indigenous plant species;

* Create wildlife corridors that will enable a movement network for natural fauna across the properties and a linear connection to Arthurs Creek to the south;

* Provide stabilisation for those areas of the properties that are experiencing noticeable land erosion; and

* To create and maintain treed ridgelines and hill tops.

An indicative Environmental Landscape Plan prepared by Terrain Consulting Group forms part of the application and was submitted with the original documentation to Council. It is proposed that this plan would be linked to each property by means of a legal agreement with Council pursuant to Section 173 of the Planning and Environment Act 1987.

14. I note that the conditions of the Notice of Decision issued by the Responsible Authority require an amended Land Management Concept Plan to be prepared and implemented. In addition to the above pints I note that the plan must also show 'building exclusion zones" for each lot as well as other matters such as weed eradication programs and more detail as to what is proposed in terms of planting and stabilisation works.

15. Ms Bannister set out the details of how it is proposed to implement the proposal in stages as follows:

The proposal to use the lots for the purpose of dwellings is to be implemented in stages. In the first five years Lot 13 is to be developed with a dwelling, and the existing vegetation along Arthurs Creek is to be fenced off and supplemented with additional planting.

In the next stage, (before 10 years have elapsed) the MacMillans propose to undertake the development of Lots 8-12. This will involve the construction of the new internal road to the northern boundary of Lot 8 from Chapel Lane, landscaping and the road reserve, and the provision of reticulated services for these lots. In the final stage, lots 2 to 7 will be developed (within 15 years from the date on which the permit issues) and the road will be extended to these lots.

16. Under the planning scheme the subject land is located within the Rural zone, the provisions for which are found at clause 35.01. The purpose of the Rural zone is:

To implement the State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies.

To provide for the sustainable use of land for Extensive animal husbandry (including dairying and grazing) and Crop raising (including Horticulture and Timber production).

* Protection and creation of effective rural infrastructure and land resource.

* Improvement of existing agricultural techniques.

* Protection and enhancement of the bio-diversity of the area.

* Value adding to agricultural products at source.

* Promotion of economic development compatible with rural activities

* Development of new sustainable rural enterprises.

To ensure that subdivision promotes effective land management practices and infrastructure provision.

17. "Dwelling" is an "as of right" or no permit required use within the Rural zone provided that the lot must, amongst other things, be at be at least 40 hectares in area. If this condition is not met, then the use falls within Section 2 of the land use table and as such, a permit is required to use the land for this purpose. Clause 35.01-2 also sets out requirements to be met before land can be used for the purpose of a dwelling.

18. Decision guidelines for the consideration of applications to use land in the Rural zone are at clause 35.01-6 and cover general issues, rural issues, environmental issues as well as design and siting issues.

19. Lots 11, 12 and 13 are affected by the Environmental Significance Overlay [ESO]. The provisions for this overlay are found at clause 42.01. The purpose of the overlay is:

To implement the State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies

To identify areas where the development of land may be affected by environmental constraints.

To ensure that development is compatible with identified environmental values.

20. A permit is required under the overlay to construct a building, to carry out works and to remove vegetation. The decision guidelines under the overlay require consideration to be given to the planning scheme's policies, the Statement of Environmental Significance and the objectives in any applicable schedule as well as any other relevant matter.

21. Lots 11, 12 and 13 are affected by the provisions of schedule 1 to the Environment Significance Overlay [ESO1]. The statement of environmental significance states:

Much of the shire is heavily vegetated and supports a diverse range of native fauna and flora. Some species are listed under the Flora and Fauna Guarantee Act. There are specific sites occurring on both private and public land that have been identified as being of particular importance within the Sites Faunal and Habitat Significance in North-East Melbourne (Beardsell 1997). Identification, protection and enhancement of the environmentally significant sites and strengthening of connecting habitat links will assist in the maintenance of bio diversity within the shire and surrounding area.

22. The environmental objectives to be achieved for the ESO1 are:

* To protect and enhance sites of faunal and habitat significance identified in (Beardsell 1997) Sites of Faunal and Habitat Significance in North-East Melbourne.

* To protect and enhance regional and strategic habitat links identified in (Beardsell 1997) Sites of Faunal and Habitat Significance in North East Melbourne.

23. Lot 13 is also affected by schedule 4 to the ESO [ESO4]. The Statement of Significance for the ESO4 is as follows:

The waterways within the Shire of Nillumbik are an integral element of the environmental systems that support biodiversity, and directly impact on freshwater environments. Waterways also often provide relatively undisturbed habitat corridors between larger areas of remnant vegetation. The many threatened flora and fauna species identified as existing in the Shire rely, to a great extent, on the catchment areas of watercourses in the Shire. These areas need to be protected from inappropriate development.

24. The environmental objectives to be achieved are:

s To maintain environmental flows and improve the quality of water within watercourses.

s To maintain the capacity of watercourses to carry natural flows.

s To prevent erosion of banks, stream beds and adjoining land and the siltation of watercourses, drains and other features.

s To protect and enhance the diversity, integrity and health of local flora and fauna habitats within and along watercourses.

s To ensure that development (including fill) does not occur on land liable to flooding.

s To ensure that subdivision and development is compatible with the environmental values of watercourses.

s To provide for the retention, restoration and revegetation of local native species

s To protect natural landforms and geological features.

s To ensure that the scenic qualities and visual character of waterway corridors are not compromised by the inappropriate siting of buildings, the placement of fill or lack of screening vegetation.

s To restore those sections of waterway corridors which have been previously modified to create artificial beds, banks and landforms.

25. The general decision guidelines at clause 65 must also be considered. These require consideration to be given to matters such as the purpose of the zone, orderly planning and amenity.

26. The purpose of the zone, overlay and the decision guidelines require consideration to be given to the State Planning Policy Framework [SPPF] and the Local Planning Policy Framework [LPPF]. Based on the submissions presented by the parties and the evidence of the two planning experts, there are numerous policies, objectives and strategies set out within the both the SPPF and LPPF which are in some way relevant to the consideration of the proposal before me. I do not propose to set the details of these policies out in these written reasons as to do so would simply lengthen them unnecessarily. Suffice to say that those which are most directly relevant to the consideration of the proposal include:

* Clause 15.09 Conservation of native flora and fauna

* Clause 21.03 Municipal Profile and Key Influences

* Clause 21.05-3 MSS - Environment Conservation and Landscape

28. At the hearing, the parties tabled and spoke to written submissions. In addition I was presented with various other documents and material relevant to the consideration of the proposal. These included plans, maps, photographs of the land and extracts from various documents.

29. Mr Townsend called Mr Gavin Crawford, a planning consultant, to give evidence on planning matters. Ms Bannister called expert evidence from Mr Evan Patterson, a town planning consultant and Mr P Coates, an agricultural consultant. All witnesses were made available for cross examination.

30. All of the material and evidence has been taken into account and is retained on the Tribunal's file.

31. I have inspected the subject land and surrounding area.

32. After having considered the evidence and submissions, the details of the proposal and the relevant matters to be taken into account under the planning scheme and legislation, it seems to me that the fundamental question in this matter is whether allowing each lot to be used and developed with a dwelling accords with the notion of orderly and proper planning of the area having regard to the circumstances at hand. Fundamentally, this involves making an assessment of whether the outcome achieved if the proposal is implemented accords with the policies and strategies set out in the scheme and the purpose of the zone.

33. In this particular case, it is true that the land is comprised of a number of lots and therefore is already "subdivided". It is also the case that each lot could potentially be disposed of as a separate parcel of land. Therefore, although the subject land exists as one farm, this is not a situation where permission is required to subdivide the land to create lots to be disposed of separately. To this extent, I agree with Ms Bannister's submission that the land is already "fragmented".

34. However, whilst this particular farm is comprised of a number of lots, this in itself is not an unusual occurrence. Nor is it an unusual occurrence that a farm may be comprised of a number of lots which, if taken individually, are not in themselves viable farming units although when taken collectively, they can support a viable farming operation. This is exactly what has happened on the subject land. It would be difficult to argue that any of the individual lots would have been a viable farming unit for grazing, however, taken collectively, the land has been operated as a farm since the 1920's.

35. In considering the weight to be given the land's division into a number of lots, I refer to the to the Tribunal's decision in Parkworth Pty Ltd and Keska Management Pty Ltd v Casey CC [2002] VCAT 1594 when Senior Member Byard said:

As I have said, the issues of proliferation of rural houses and rural subdivision have been very live policy issues in relation to rural planning for decades. There are some old and fallacious "chestnuts" frequently trotted out in relation to the discussion of such issues. One of the oldest of such fallacies is to say that a piece of farming land has to be a sustainable and viable farming unit, standing on its own and alone from other land, before it can be considered as useful farming land worth preserving from the harmful effects of the proliferation of rural houses and the fragmentation of farming land into small pieces. The size for a viable farming enterprise varies greatly throughout Victoria and is dependent on many factors such as soil, topography, water supply, rainfall, suitability for various particular forms of farming and so on. The size for viability in this sense is tended to increase over the second half of the 20th century. Fifty years ago a dairy farm of 15 to 20 hectares on fertile soil with favourable topography and good rainfall might well support a family dairy farm. I doubt that this would be so today. However, the sleight of hand involved is to suggest that all of the viable farm undertakings has to be in one piece. Many viable farming undertakings involve more than one piece of farmland, not necessarily contiguous one with another. If this allotment is not a viable farm standing alone, it does not follow that it is not a useful and valuable piece of farming land capable of being a useful and valuable adjunct to a farming undertaking on other land.

36. A number of important points can be drawn from the above. The first is point that it is not just the subdivision of rural land which raises policy issues, but also "the proliferation of rural houses". Second, and perhaps most importantly in this case, it is not necessary for a parcel of land to stand alone, that is, as a separate lot, for it to be considered a useful and valuable piece of farming land.

37. It is relevant that a permit is not simply required for the construction of a dwelling. "Dwelling" is not an "as of right use" on lots of the size that comprise the subject land. "Dwelling" is a discretionary or section 2 use on each lot and therefore, a fundamental issue to be decided in this case is whether this is an appropriate use having regard to the decision guidelines in the scheme.

38. In this regard I refer to the often forgotten provisions of clause 31 which relate to the operation of the zones within the planning scheme. Clause 31.01-2 states the following in relation to "making decisions about section 2 uses":

"Because a use is in section 2 does not imply that a permit should or will be granted. The responsible authority must decide whether the proposal will produce acceptable outcomes in terms of the State Planning Policy Framework, the Local Planning Policy Framework, the purpose and decision guidelines of the zone and any other decision guidelines in clause 65."

39. The sentiments expressed in the above paragraph are also reflected in the first paragraph of the decision guidelines under clause 65.

40. In light of the above, applications of this type should not be based on an expectation or an assumption that because there is discretion for a permit to be issued for the use and development of each lot for a dwelling, that it is a fait accompli that this will happen. Rather, in considering any application for a discretionary use, it will be necessary to demonstrate that the use accords with the notion of orderly planning. This needs to be demonstrated in terms of the outcome being consistent with the scheme's strategic frameworks and the purpose of the zone as well as the land's capability to support the use.

41. There was no real dispute that the lots comprising the subject land have the technical capability to support a dwelling. In this regard I refer to the provisions of clause 35.01-2 which set out requirements which must be met. These requirements relate to the provision of suitable road access, that waste water can be treated on site and that a suitable water supply be available. The proposal involves the construction of the unmade internal road to a rural standard whilst no concerns were raised about effluent disposal or the provision of water. Based on the material before me, I am satisfied that the proposal meets these technical requirements.

42. The planning scheme's decision guidelines, however, require more than this. In this regard I refer to the Tribunal's decision in Adams v Indigo SC [2002] VCAT 280 (18 April 2002) when Member Hewet said:

With respect to the submission that the proposal demonstrates compliance with the local policy at clause 22.02-1, I acknowledge that the configuration of the subdivision does meet certain relevant tests under that clause, however this does not outweigh my principal findings with respect to the application's failure to achieve acceptable outcomes having regard to the policy framework in its totality. Had I formed a different view on that matter, the configuration of the proposed lot, access arrangements and its ability to contain and treat on site waste water and effluent, are matters, among others, which would also have to be addressed and considered. As I have indicated, I do not regard compliance with these detailed provisions as being sufficient to justify the grant of a permit in the face of the overwhelming policy provisions which are mounted against the grant of a permit.

43. Accordingly, whilst compliance with the technical requirements of clause 35.01-2 is a factor which favours the proposal, it is not one which I consider can be ought to be decisive. Rather, it is clear that the approach to be taken is to consider whether the proposal meets scheme's policies, objectives and strategies when considered as a whole. There will obviously be competing objectives and policies, however, these need to be balanced in the assessment of whether when taken on an overall basis, the proposal produces an acceptable outcome.

44. On this point I refer to Mr Patterson's evidence. In supporting the proposal, I note that Mr Patterson said (pages 14 and 15 of his report)

It is clearly evident that both State and Local Policy support sustainable agricultural activities. Furthermore, the fragmentation of land ownership and inappropriate subdivision can lead to the loss of productive agricultural land.

It must be accepted however, that the application is not to subdivide land but to use 11 existing allotments, each for the purpose of a dwelling. The size of these allotments range from 7.2 to 9.0 hectares and each has frontage to a road reservation.

The allotments form part of 12 separate titles that are owned by three brothers Ian, Malcolm and Ross MacMillan. It is my understanding that an arrangement currently exists for Ian McMillan to reside at and manage the properties as a cattle farm. Subject to the retirement of Ian, it is not intended that this current farming arrangement will be continued.

It is accepted that the arrangement held between the three MacMillan Brothers will ultimately end and that the 12 allotments will become available for individual sale. Important to note, is the internal road can be constructed without requiring a planning permit from Council and thus facilitating separate disposal of the properties.

Having regard to the size of the properties ranging from 7.9 to 9.9 hectares, it is beyond doubt that each property is capable of supporting a single dwelling with associated outbuildings, accessways and servicing.

With respect to the relevant provisions of the MSS, it is noted that the application proposed will not alter the existing subdivision pattern of the area but will simply enable the development and use of individual properties to be realised in a co-ordinated manner. Importantly it enables the opportunity to implement a comprehensive Land Management Plan that will bring environmental benefits to the individual properties. This plan would be implemented and enforced by means of a planning permit and Section 173 Agreement registered on the individual titles.

46. Whilst I accept the benefit associated with the implementation of Land Management Plan, I was far from persuaded by Mr Patterson's evidence that this proposal is supported by the planning scheme's policies and strategies or the purpose of the zone. Rather, it appeared to me that Mr Patterson's support for this proposal was largely based on the fact that the land is in 12 lots, no subdivision is involved and each lot is capable of supporting a dwelling. It seemed to me that Mr Patterson was also placing considerable reliance on the opportunity which this application presents in terms of the development of implementation of a Land Management Plan over all the lots and the environmental benefits that would be derived from this.

47. Mr Crawford's views were somewhat different. He listed the various policies and strategies that apply and came to the view that the proposal will act to fragment the viability of rural land and contrary to the intents of the MSS and the Rural zone. He also expressed concerns about the impacts which the proposal would have on the visual amenity of the area.

48. On reviewing their evidence, I found neither expert came to grips with the task of analysing the somewhat complicated policy framework which applies. It seemed to me that Ms Bannister and Mr Townsend had a far better grasp of what this proposal involves and they were able to present more comprehensive arguments on how policy should be applied in this case.

49. In general terms I have no difficulty accepting the proposition put to me by Ms Bannister that the preparation and implementation of the Land Management Plan is clearly a positive aspect of this proposal. The benefits associated with the proper implementation of the plan include the reduction in gully erosion through additional planting that will stabilise soil. This will make a contribution to improving water quality through the reduction of sediment. It would be difficult not to accept that the extensive tree planting proposed will improve the appearance of the area and its landscape qualities. Furthermore, the tree planting proposed will assist in restoring and improving wildlife corridors that have been impacted upon by the removal of vegetation in the past to facilitate agricultural pursuits in this area.

50. To this extent, I consider that the proposal is consistent with the environmental policies within both the SPPF and LPPF. I have no difficulty in accepting that the tree planting proposed will work towards improving water quality by way of reduced erosion (see clause 15.01), the retention and enhancement of a habitat for native plants and animals (see clause 15.09), and the enhancement of landscape values although the contribution in this regard is tempered by the potential for additional buildings.

51. However, this approach places substantial weight on the contribution which the implementation of the Land Management Plan makes to achieving the type of outcome that is called for by the planning scheme as a whole.

52. It was also submitted by Ms Bannister that the proposal does not involve the alienation of high quality agricultural land from rural use. Ms Bannister relied on the evidence of Mr Coates in this regard. Mr Coates said that based on his investigations, the subject land could not be described as first class country which should be preserved for farming purposes. In particular Mr Coates pointed to poor soil quality which would be costly to improve and the difficulty in developing new pasture due to constraints associated with the slope of the land and the potential for erosion. Mr Coates said that 40 hectare allotments in this Shire (the minimum lot size) will not provide a viable base for farming and that given the conditions of the land and that a better outcome would be achieved through the use of the lots for dwellings and the associated implementation of tree planting.

53. Mr Townsend agreed that the land in question does not contain the high quality agricultural soils which are sought to be protected by the policy at clause 17.05. None the less he did point to the various references in the MSS which call for the protection of agricultural land for both its productive and environmental value. It seems that the Tribunal was faced with a similar issue in Widdison v Moorabool Shire Council and Central Highlands Water [2002] VCAT 1535 (26 November 2002) a matter which involved permission being sought to use each of three adjoining lots, around the 6-7 hectare mark and zoned Rural, for a dwelling. On this issue, Member Davies said:

I appreciate that the lots are small and have poor soil quality. This is not a situation where the desirability of removing high quality farmland from primary production is a critical issue. I accept Mr Eskdale's advice that the current use of the land for grazing is not a sustainable rural use. It occurs "as a hobby and to cover the rates". Nevertheless, the absence of an existing sustainable rural use does not by default mean that the development of dwellings is appropriate.

54. As clearly indicated by the decision guidelines, the examination of this type of proposal needs to be made in light of the policies and strategies set out in the planning scheme. On this point, at clause 21.03, the MSS states:

In relation to agriculture, large scale enterprises are uncommon.

Whilst much of the geographic are of the shire is rural, there are only a handful of large agricultural enterprises. The majority of the shire's rural areas have thin, highly dispersive soils with low fertility that are subject to erosion. This makes the shire unsuitable for traditional agricultural use.

Agricultural land should be protected for both its productive potential and environmental value. High quality agricultural soils should be retained for soil based agricultural production and sustainable use of the land is to be encouraged for that purpose. Farm scale, particularly the broad acre farming areas in the north-west of the shire should be maintained.

56. It seems to me that in the above passages there is a recognition within the MSS that there are difficulties with agricultural land in the municipality. Problems with soil quality and potential for erosion are specifically identified.

57. Despite this, the MSS seeks to protect agricultural land for both its productive potential and environmental values. The MSS recognises that there may be conflict between agricultural pursuits, rural living and other uses. In this regard I note that at clause 21.03-2 the MSS states:

Conflict may occur between agricultural pursuits, rural living and other uses within rural areas of the Shire. While many uses and associated developments are allowed in rural areas, new uses must be planned so as to maintain the quality and quantity of natural resources, support the sustainable management of natural systems and support `best practice' agriculture. Similarly, subdivision should not challenge the integrity of the natural environment or the productiveness of agricultural land.

58. Furthermore, at clause 21.03-3, the MSS states:

Landscape values, consisting of urban and non-urban vistas within the Shire, are under increasing pressure as a result of changing land uses and developments. The containment and consolidation of townships and the maintenance of boundaries between the urban and non-urban areas and vegetation retention will be critical in maintaining and enhancing these landscape values. Siting and design consideration which respects the neighbourhood character (including built form, vegetation and topography) is particularly important in the urban areas of the Shire. Landscape values in rural areas will be best protected by restricting numbers of buildings and by ensuring buildings are sited and designed to avoid prominence from surrounding properties and roads.

59. I have reviewed the objectives for rural land use at clause 21.05-2. These call for outcomes which "promote sustainable agriculture", "limit the fragmentation of land in rural areas," "facilitate the separation of conflicting rural land uses" and "to minimise the infrastructure servicing demands in rural areas".

60. The above analysis leads me to the view that the MSS acknowledges the constraints associated with rural land in the municipality. However, the MSS still seeks to protect both its agricultural capacity and environmental values. It recognises that there are potential conflicts associated between those seeking to undertake agricultural pursuits as opposed to those seeking a rural lifestyle. It acknowledges that there are implications in terms of providing services to rural areas.

61. The difficulty I have with this proposal is that allowing each of these lots to be redeveloped with a dwelling is essentially akin to the creation of a rural living or hobby farm type area. It was submitted by Ms Bannister that the establishment of hobby farms on each of the lots would be consistent with the purpose of the Rural zone in that they would at least provide some potential for the land to be productive. I do not agree with this. Rather I think Mr Byard's remarks in Parkworth are more to the point when he said:

Hobby farmers are not genuine farmers and contribute little or nothing in terms of primary production. Genuine farmers complain that the introduction of these amateurs is detrimental to genuine farming. The amateurs frequently have little skill, aptitude and desire to farm properly. They don't have the same incentives of genuine farmers to keep down vermin and noxious weeds and dogs, other than genuine farm working dogs, often present a danger to stock and wildlife. Furthermore, rural residents frequently start demanding town services which are uneconomic to provide to scattered houses or scattered hamlets in what is supposed to be farming land. These demands involve seeking to have other ratepayers, whether real farmers or urban dwellers, subsidise rural residential lifestyles. The inefficiency of trying to provide urban services in such areas is obvious enough.

62. Furthermore, on reviewing the scheme's policies or strategies as a whole, I cannot come to the conclusion that the use and development of each lots for a dwelling is the type of outcome which is being sought in this area. The planning scheme identifies locations where rural living and hobby farm type activities are encouraged. This is not one of them. I cannot accept that as a matter of good planning, it is appropriate to allow each of these lots to be developed for a dwelling without such use and development being underpinned and specifically supported by the scheme's policies and strategies.

63. On this point, I note the views of the Tribunal in Zignet Pty Ltd v Campaspe SC [2003] VCAT 142 (31 January 2003) a case involving land in the Rural zone and a proposal to use and develop a dwelling on nine lots ranging in size from 8 hectares to about 60 hectares. In particular Member Bennett said:

I accept that the land has been used for grazing purposes in the past and that at present it is not being used for productive agricultural purposes. I note that the land is not identified by the Council as being of high agricultural quality and that it is identified as being within the dryland agricultural area. However the land could continue to be operated as one larger agricultural holding as is other land to the south and west. I accept that there are many areas in the Shire where agricultural productivity is low and in many cases farm income has to be supplemented by off farm income (as in many parts of Australia). This low productivity does not justify converting the land for rural residential or hobby farm purposes, particularly given that the vast majority of the land is cleared grazing land and not remnant bushland.

64. In relation to the consideration of environmental benefits associated with the proposal, Member Bennett said:

My inspection confirmed the generally poor quality of the land and the existence of vegetation on some of the lots (particularly towards the north end of Walbran Road). I agree with Mr Cellante's submission that the use of the land for hobby farm purposes may mean that there is more chance of existing vegetation being retained and additional planting being undertaken, as compared to its continued use as marginal farmland where existing vegetation is less likely to be managed or preserved. I consider that the flora and fauna habitat on these sites is likely to improve but as noted elsewhere, I am rejecting the application for other reasons relating to planning policy.

In making my assessment of the proposal I have weighed up the various competing factors concerning the balance between protecting agricultural land and allowing for more effective use of land for hobby farm activities. I have found that the adverse impacts on the agricultural land outweigh the benefits to be gained from allowing a house on each of the nine lots. I find that providing for nine houses in this location is inconsistent with State and Local Planning Policy Frameworks and in particular is contrary to policy contained in Clause 22.01. If small lots in rural areas are to be used for housing purposes then the land should be assessed on a strategic basis. If warranted, appropriate zonings should then be put in place to recognise the outcomes of that strategic assessment. Such a course would avoid the type of ad hoc approach demonstrated by the nine applications in this case. (my emphasis)

66. In Widdison, the Tribunal went on to come to a similar conclusion when it said:

74. I acknowledge that the size of the sites owned by the applicants pose problems for long term viable rural use. Again that matter should not override proper planning. There may be a justification for a comprehensive re-structuring of land around the Mt Egerton township. Alternatively, a review of the zoning of land may be appropriate. However, in the absence of such a review and given the current zoning of the land and applicable policies I do not believe the approval of the proposed dwellings on an ad hoc basis can be justified. It would also create an undesirable precedent.(my emphasis)

75. For the reasons advanced above I will disallow the Applications for Review and make the appropriate order.

67. The proposal before me does not involve many applications, however, I do not think that this makes a significant difference given the applications in the above cases were considered simultaneously. I have acknowledged that the implementation of the Land Management Plan is a positive aspect. However, this needs to be balanced against what I consider is a lack of policy and strategic support for the establishment of a rural living "hobby farm" type area in this locality.

68. I consider that the applicants have placed far too much weight on the fact that the land is subdivided and the benefits associated with the Land Management Plan. The proposed use is discretionary and for good reason. Ad hoc or unplanned rural residential development is simply inappropriate and can compromise nearby agricultural pursuits that are appropriately located within the area, cause conflict between occupiers who have different expectations as to what amenity ought to be expected as well as raising the inevitable expectations and increasing pressure on the Responsible Authority to provide services and infrastructure.

69. I do not consider that the environmental benefits associated with the proposal outweigh the lack of strategic justification for this proposal. As such I have formed the view that this proposal should be rejected. The proposal is not in accordance with the orderly planning of the area.

70. I consider it necessary to make two other observations about the proposal.

71. The first is that the staging of the proposal is to occur over a relatively long time frame and I question the appropriateness of this. It is most unusual for this time frame to be allowed, particularly given the scale of what is being proposed. It seems to me that the staging of this proposal is based around the gradual development and selling off of the farm, virtually a bit at a time. This approach adds to my concerns about this proposal.

72. The second relates to Ms Bannister's submission that the Notice of Decision has been framed so that no further permit would be required for the development and works associated with a dwelling on each lot. In this regard I note that the permit allows the use of the land, in accordance with the endorsed plans which will set out such matters as building exclusion zones. However, I do not consider that the permission allowed in the Notice of Decision relates to the eventual development. In any event, even if it did, I would find such an approach to be questionable. A permit is required under the Rural zone for the construction of buildings and works. I fail to see how it is appropriate for a matter which requires primary consent under the scheme to be given without plans. For example, if a permit is required to use and develop land for medium density housing or an office, would permission be granted without plans for the buildings? The various decision guidelines at clause 35.01-6 require quite specific matters to be considered, and without plans, I find it difficult to accept that the matters set out in the decision guidelines can be properly considered.

73. In the words of Senior Member Byard in Parkworth:

Good planning generally looks for urban activities, including residential uses, to be confined to urban areas and be constrained from spreading out onto farming areas. If permitted at all, rural residential and hobby farm type activities should be confined to planned areas picked out as suitable for such activities.

74. I have come to the conclusion that there is a lack of strategic support for this proposal. The outcome is not one which I consider is supported by either the purpose of the zone or policy. Indeed, Mr Carapellotti was quite candid in submitting that "The proposed use of eleven allotments for the purpose of a dwelling is not a preferred outcome in relation Council policy and the zoning provisions."

75. The lots that comprise the subject land can potentially be disposed of separately, however, it is a considerable leap to say that a permit will be granted for each of them to be used and developed as a dwelling based on the planning scheme's policies as they currently stand. The use of each lot for a dwelling is discretionary and not as of right. Any assumption that each lot can be used for a dwelling as a matter of course is wrong.

76. Before any lot can be used for a dwelling, justification on planning grounds will be required. Whilst I accept that the proposal has some "environmental positives", I do not consider that these outweigh the lack of strategic support in the purpose of the zone and the planning scheme's policy frameworks. Furthermore, I cannot find that there is anything in Melbourne 2030 which would provide any significant support for this proposal.

77. The type of outcome being proposed in this application should be clearly underpinned by the planning scheme's strategies and zoning. My views are akin to those expressed in Zignet and Widdison. If the proposal represents the type of outcome that the Responsible Authority considers appropriate, then the appropriate course of for this to be clearly articulated in the MSS and reflected in the zoning of the area. The proposal can be considered afresh when this occurs.