1. Pursuant to Section 149A of the Planning and Environment Act 1987 the Tribunal makes the following declaration:

(a) The Restrictive Covenant contained in Transfer No 1550806 affecting 29 Barmah Street, Mount Eliza 3930 being Lot 525 on Plan of Subdivision 10791 being the land more particularly described in Certificate of Title Volume 8228 Folio 071 does not restrict the construction of more than one dwelling house on that land,

(b) the grant by the Responsible Authority of a permit for the construction of more than one dwelling house on that land is not by virtue of that Restrictive Covenant impeded by Section 61(4) of the Planning and Environment Act 1987.

For the Applicant: Ms Joycey Tooher of Counsel instructed by B Lester Oldham, Solicitor.

1. This is an application made by Christopher William Gubby, the owner of 29 Barmah Street, Mount Eliza for a declaration:

(a) That the Restrictive Covenant contained in Transfer No 1550806 affecting 29 Barmah Street, Mount Eliza 3930 being Lot 5 on Plan of Subdivision 10791 more particularly described in Certificate of Title Volume 8226 Folio 071 (the property) does not restrict the construction of more than one dwelling house on the property, and

(b) Further or alternatively, the Tribunal declare there is no impediment by reason of Section 61(4) of the Planning and Environment Act to the grant of a permit for than one dwelling house on the said property.

2. The Applicant has lodged with the Responsible Authority, Mornington Peninsula Shire Council ("Council"), an application for a permit No P02/0210 for the proposed second dwelling. Council has not advertised nor sought further information on the application, as it and the Applicant consider the Tribunal should determine this declaration application before the Council proceeds further on the permit application.

3. At a Directions Hearing held on 4 June 2002 the Tribunal directed the Applicant give notice of the declaration application to the owners and occupiers of all land having the benefit of the Restrictive Covenant affecting the property.

4. On 23 July 2002 the Tribunal received a statutory declaration from the Applicant that this had been done. Council raised no question as to the adequacy of compliance.

5. Following the giving of this notice, statements of grounds objecting to the declaration application and the proposed second dwelling were received from:

* Frank Hogan as the owner of 60 Kornalla Crescent, Mount Eliza;

* Jeff Sellenger of 45 Barmah Street, Mount Eliza;

6. At the hearing written submissions were made by Mr Matthews for the Council and by Ms Tooher for the Applicant. No evidence was called. It was not necessary to take a view of the property.

7. Council did not oppose nor consent to the declaration. It had received legal advice in relation to the Restrictive Covenant that its wording was ambiguous and that Council could not reasonably form the view that approval of the application would not conflict with the requirements of Section 61 of the Planning and Environment Ac 1987. On this basis Council had advised the permit applicant that the permit application had been placed on hold pending a declaration from this Tribunal regarding the status of the Restrictive Covenant. Pending the making of the declaration no assessment under ResCode would be undertaken and once it is made, there may be a requirement for further information, before notice of the permit application will be directed.

8. Council advised the Applicant that in the absence of a declaration from the Tribunal a decision to refuse the application would be the only decision that Council could reasonably make. The Applicant chose to seek a declaration before the Council made a decision.

9. Council submitted that the existence of a number of breaches of the similar covenants in the locality by the development of more than one dwelling on a lot, does not in itself provide justification for one particular interpretation of the covenant.

10. Council also advised the Tribunal that prior to the amendments to the Planning and Environment Act 1987 relating to restrictive covenants from on 13 December 2002, there was no impediment to Council issuing a permit for a development that would breach a registered restrictive covenant, and there would be numerous examples where individuals have acted on permits issued prior to that date that had breached restrictive covenants.

11. Council does not hold a firm view as to which way the covenant should be interpreted. Council only seeks to ensure that any decision to issue a planning permit would not conflict with the requirements of Section 61(4) of the Planning and Environment Act1987, and it was prepared to accept the Tribunal's decision.

12. The declaration application in its original form referred to Section 73(2) of the Planning and Environment Ac1987. By consent leave was given to the Applicant to amend this reference to Section 61(4).

13. The declaration application referred to Barmah Road. The Tribunal was advised that the correct name was Barmah Street, and leave was given to the Applicant to amend the application accordingly.

14. The land is on the southeast corner of Barmah Street and Acheron Avenue. An existing rendered single storey house with an attached double car garage and store is located centrally on the land. It has a setback of 7.2 metres to the Barmah Street boundary (to the garage) and approximately 7.5 metres to the Acheron Street boundary. A tennis court is situated at the rear (eastern side) in Acheron Avenue. This is the site of the proposed second dwelling.

* frontage of 31.954 metres to Barmah Street (to the west),

* a secondary frontage of 51.828 metres to Acheron Avenue (to the north), and

16. The land slopes slightly from west to east, with an average slope of approximately 3 %. There are some trees and shrubs on the Barmah Avenue side of the dwelling in close proximity to the land's boundaries. The perimeter of the tennis court, particularly on the east side, has dense vegetation cover. A 1.828 metre wide easement runs along the east boundary.

17. The Title particulars of the land are described above. The Restrictive Covenant was created by an instrument of transfer dated 29 May 1934 from H P Keogh and J H King to Ethel May Harris of Lots 525 and 526 on the Plan of Subdivision.

18. The relevant parts of the text of the covenant is that the transferee covenant with the transferors:

" - their and each of their heirs executors administrators and transferees registered proprietor or proprietors for the time being of the land comprised in Certificate of Title Volume 4658 Folio 931443 (other than the land hereby transferred) as follows:-

(a) That no building shall be erected on any lot hereby transferred other than a private dwelling house the cost of which exclusive of all fences and outbuildings and architects fees shall be not less than Five hundred pounds.

(b) That no earth clay stone gravel or sand shall be excavated or removed from the said land hereby transferred or any part thereof except for the purpose of excavating the foundations of any building to be erected thereon.

(c) That the said land hereby transferred or any part thereof shall not be used for the manufacture of or for the winning of material for the manufacture of bricks tiles or pottery ware.

and these covenants hereinbefore contained shall be noted on and appear on the Certificate of Title to issue to the said Ethel May Harris under this transfer and on every future Certificate of Title for the said land hereby transferred and every or any part or parts thereof as an encumbrance affecting the same."

19. The permit application proposes a second dwelling on the east side of the existing dwelling on the land, to be single storey and containing an entry, open plan lounge/family/kitchen, two bedrooms (one with en-suite), study, bathroom, laundry, toilet and attached double car garage (6m by 5.5m).

20. The land is subject to the Mornington Peninsula Planning Scheme. It is zoned Residential 1 and is subject to a Vegetation Protection Overlay - Schedule 1 - Township vegetation, and to a Design and Development Overlay - Schedule 2 - Bayside and village Design.

21. Under the Residential 1 Zone a permit is required to develop a dwelling if there is at least one dwelling on the lot (Clause 32.01-4). The dwelling must meet the requirements of Clause 55.

22. A planning permit is also required under the DDO (Clause 43.02-2 - Schedule 2). Council's submission indicated that the proposal satisfied mandatory requirements of the DDO.

23. A planning permit would be required under the VPO (Clause 42.02) for the removal of any vegetation associated with the development.

24. Section 61(4) of the Planning and Environment Act 1987 provides:

"If the grant of a permit would authorise anything which would result in the breach of a registered restrictive covenant, the responsible authority must refuse to grant the permit unless the permit has been issued, or a decision made to grant a permit, to allow the removal or variation of the covenant."

25. The Applicant submitted this covenant in substance restricts the construction of any buildings other than dwelling houses of a particular standard but does not restrict the number of dwellings that can be built on the land.

(a) a restrictive covenant is a proprietary right and a private planning device arising from a consensual contract. It is an agreement contained in a transfer of land which has the effect of a deed under Section 40(2) of the Transfer of Land Act 1958, although the recent amendments to the Planning and Environment Act 1987 have given restrictive covenants status in the planning system.

(b) what the covenant means is a question of fact to be determined by the language and context of the actual document in which it appears. This will differ from case to case depending on the actual language in which the restrictive covenant is framed (see Herring CJ in Bishop and Lynch's Contract [1957] VLR 179 at 181), and the remarks of Mann CJ in Marshall and Scott's Contract [1938] VicLawRp 22; [1938] VLR 98 that "small differences in words are of great importance and the decision often turns on them".

27. The governing principles of interpretation must be strictly and literally applied because the covenant now affects third parties who were not contracting parties to the original agreement.

28. The first principle she referred to was that the words of the instrument hold the key to its meaning and it must be examined in the context of the whole instrument. She submitted this is the same approach used for the interpretation of statutes, and referred to Gibbs J in Australian Broadcasting Corporation v Australian Performing Rights Association Limited [1973] HCA 36; (1973) 129 CLR 99 at 109 - 110 and Mason J in K & S Lake City Freighters Pty Ltd v Gordon and Gotch [1985] HCA 48; (1985) 60 ALR 509 at 514.

29. I accept her argument that the following aspects of this covenant indicate that the constraints in the covenant are directed at confining the land use to quality residential buildings rather than limiting the number of dwelling houses on each lot:

* The covenant was a transfer in 1934 of 2 lots from two estate agents.

* Each lot sold was burdened by the covenant for the benefit of land retained by the vendors.

* The covenant under consideration was one of three in the transfer, the other two quoted above relating to the excavation or removal of earth, clay, stone, gravel or sand and prohibiting the use of the land for manufacture or winning of material for manufacture of bricks, tiles or pottery ware.

30. The second principle of interpretation referred to by Ms Tooher was that the only means by which the intention of the parties is communicated are the words of the instrument and the context in which they appear.

* Extrinsic evidence is not relevant to the question of construction (see Watson v Phipps (1985) 63 ALR 321 at page 324.

* The Interpretation of Legislation Act Section 37(c) should be used in the interpretation of deeds and written instruments. This provision reads:

In an Act or subordinate instrument, unless the contrary intention appears-

(a) words importing a gender include every other gender; and

(c) words in the singular include the plural; and

* Likewise the Tribunal is obliged to consider Section 61(c) of the Property Law Act 1958, which was in operation at the time of the making of the restrictive covenant and which reads:

"In all deeds, contracts, wills, orders and other instruments executed, made or coming into operation after the commencement of this Act, unless the context otherwise require the singular includes the plural and vice versa."

33. There is authority that such legislation can be used in the interpretation of deed in written instruments (see Callaway JJA in Hanlon v Brookes (1997) 15 ACLC 1626), and it is to be assumed that the draughtsman has the presumption in mind when drafting the relevant instrument (see Blue Metal Instruments v Dilley [1969] UKPCHCA 2; (1969) 117 CLR 651.

34. The application of these statutory provisions mean that the covenant can be interpreted to read:

'That no building or buildings shall be erected on any lot or lots hereby transferred other than a private dwelling house or private dwelling houses the cost of which exclusive of all fences and outbuildings and architects fees shall be not less than Five hundred pounds."

35. Using this interpretation "no building shall be erected" would be interpreted to mean a prohibition that refers to buildings in general and not just one building.

36. Contrary intentions should be clearly indicated (see Simpson v Nominal Defendant) (1976) 13 ALR 218 at 224 and Fordham v Brideson [1986] VicRp 55; (1986) VR 587 at 591 per Brooking JA and Medved v Dunlop Olympic Limited (1991) 104 ALR 340.

37. Ms Tooher referred to the indefinite article "a" that qualifies the word "dwelling" and argued that its use is not evidence of a contrary intention because there is nothing to indicate that the indefinite article means a single or one dwelling only. She referred to the definition in the Australian Concise Oxford Dictionary (1987) which defines "a" as an indefinite article, and includes it as an unempathetic substitute for "...one; some; any; one like; one single...".

38. She tendered a helpful analysis of Tribunal decisions where the Tribunal had taken the view that the restrictive covenant indicated an intention that it was a single dwelling covenant:

Zullaphella Pty Ltd v Stonnington CC & Ors [1999] VCAT 200 (1 December 1999)

"... that there may not be erected on either of the said lots any buildings other than one dwelling house only with such outbuildings as are customarily used in connection with the dwelling house and that the roof of such dwelling house or any part thereof may not be of iron."

Bennett v Maroondah CC [2001] (7 November 2001)

"... will not erect or cause to be erected on the said land hereby transferred more than one dwelling house....."

Monash v Pateras [1999] VCAT 2140 (31 December 1999)

"...shall not at any time hereafter erect and construct or allow to be erected or constructed more than one dwelling house on each lot...which dwelling house exclusive of outbuildings and conveniences shall cost not less than six hundred and fifty pounds nor have a roof of galvanised iron or tin....."

Basile v Moreland CC & Ors [2002] VCAT 1027 (20 September 2002)

"...the said transferee does hereby for himself his heirs executors administrators and transferees covenant with the said transferor his executors his heirs executors and administrators that each of the said lots shall at all times hereafter be maintained and used as a site for one dwelling-house only."

"No dwelling other than one single storey dwelling of brick, brick veneer or masonry construction, with a tile roof and a floor area of not less than 185 square metres shall be erected on any lot on this plan."

Re Bishop and Lynch's Contract [1957] VLR 179

"... will not at any time hereafter erect upon the said lot hereby transferred any buildings other than a private dwelling with a slate or tile roof and will not erect more than one such dwelling upon the said land hereby transferred and that such dwelling with the outbuildings thereof shall cost not less than 500 pounds."

39. In Urban Planning and Development v Boroondara City Council [2001] VCAT 224 (28 February 2001) Deputy President Mr M F Macnamara considered a covenant reading:

"There may not be erected thereon any buildings, unless such building is a private dwelling house having a roof of material other than galvanised iron and erected at a cost of not less than 600 pounds."

"Despite the assertion by some of the objectors that this is a "single dwelling" covenant, the words do not bear that construction out. All that the covenant does is prohibit the erection on the site of any

building "unless such building is a private dwelling house..." If this permit is granted both the buildings on the site will be private dwelling houses. Neither of them has a galvanised roof. Whilst there was no evidence as to the cost of either dwelling, I am prepared to conclude from the material before me that they would have cost in excess of £600 (now $1200)."

41. The third principle of interpretation referred to by Ms Tooher was that the instrument should be construed against the person who drafted it. She indicated that the instrument was obviously prepared by business people who had taken legal advice in the preparation of the covenant and that they ought to look after their own interests in framing their own contracts and covenants, that they were able to get protection and advice and must make their covenants express so as to state what they really mean. See Lord Justice James in Kemp v Bird (1877) 5 CH D 974 at 976 and Albion Insurance Company Limited v Body Corporate Strata Plan No 430 [1983] VicRp 94; (1983) 2 VR 339.

42. Ms Tooher was also careful to refer the Tribunal to the text Bradbrook and Neave on Easements and Restrictive Covenants in Australia, paragraph 15.6 on page 365, which stated that

"when a doubt arises as to the meaning of words in the covenant and the doubt cannot be resolved by reference to the principals already discussed above, the covenant will be construed against the covenantor and in favour of the covenantee. This principal is applied by the Court only as a last resort."

43. However she submitted that the cases referred to in relation to that passage did not relate to restrictive covenants. However my decision in this case is not affected by placing any weight in interpretation of the covenant in favour of the transferrors or the transferee. I consider that the meaning of the covenant clearly emerges from the text and from the other principals of interpretation discussed above.

44. My conclusion is that the submissions of the Applicant are sound and that the principles of interpretation indicate that the restrictive covenant is not to be read as a covenant restricting the construction of a second dwelling on the land but that the requirements of the covenant relate to the quality of the buildings on the land, and I follow Deputy President Macnamara's decision in Urban Planning and Development v Boroondara City Council.