1. An Instrument of Transfer of the land from Solomon Green to Henry Zeplin dated 18 March 1909 contains a covenant as follows:

... AND the said Henry George Zeplin hereby for himself his executors administrators and transferees covenants with the said Solomon Green his executors administrators and transferees that no house or tenement will be erected on the land hereby transferred without the previous written consent or waiver of the said Solomon Green his executors or administrators unless the said house or tenement be a double fronted brick stone or concrete or weatherboard house and erected at a cost of not less than four hundred pounds exclusive of stables and outbuildings AND FURTHER that the land to be enclosed with such house or tenement stables and outbuildings shall have a frontage of not less than fifty feet to Melby Avenue And that in the event of a breach of any of the foregoing conditions the said Henry George Zeplin or his transferees committing such breach shall pay on demand to the said Solomon Green his executors or administrators the sum of Two hundred and Fifty pounds by way of ascertained and liquidated damages for each such breach And the said Henry George Zeplin hereby requests that the above covenants may appear as an encumbrance on the Certificate of Title to be issued in respect of the land hereby transferred and run with the land.

1. The Transfer bears the Titles Office lodging book number 592063 and the certificate of title to the land notes the covenant 592063 as an encumbrance on that title.
2. The applicant initially argued that the covenant was not a 'registered restrictive covenant' for the purposes of the Planning and Environment Act 1987. I do not necessarily share that view. A 'registered restrictive covenant' is defined in the Planning and Environment Act 1987 as meaning a 'restriction' within the meaning of the Subdivision Act 1988. Although somewhat circular in definition, a 'restriction' under that latter Act simply means a restrictive covenant or restriction that can be registered, or recorded in the Register under the Transfer of Land Act 1958. Prima facie, the covenant here is restrictive and has been registered or recorded as an encumbrance in the Register. It therefore appears to fall within the statutory definition.
3. Whether the absence of benefited land affects the strict legal definition of a registered restrictive covenant under the Planning and Environment Act 1987 (as the applicant contends) is not something I need to finally decide here. However, even if this covenant is technically a 'registered restrictive covenant' (as defined), the absence of benefited land clearly affects its proper construction and operation for planning purposes.

1. I agree with the applicant that the burden of a restrictive covenant only runs with the land to burden a successor in title if the following three elements are all met[1]:
   • (a) The covenant must be negative;
   • (b) The burden of the covenant must be intended to run with the land; and
   • (c) The covenant must be given for the benefit of land, not simply for the benefit of the covenantee, and the covenant must touch and concern that land.
2. From an examination of the wording of the covenant, the first two elements appear to be met here. The obligations are restrictive in nature, and the last few lines of the covenant evince an intention that the burden of the covenant will appear as an encumbrance on the title to the transferred land and run with that land.
3. The third element is not however met. From an examination of the wording of the covenant, it does not indicate any land that receives the benefit of the covenant, nor is it indicated that the covenant touches or concerns any identifiable land. Indeed, it would appear that the covenant is simply for the benefit of the covenantee (i.e. the vendor Solomon Green), as the covenantee his executors or administrators can waive the obligation, and a breach is remedied by fixed liquidated damages payable to the covenantee his executors or administrators. There is no mention of benefiting 'transferees' of the vendor in this part of the covenant, nor any identifiable benefited land. The benefit of the covenant appears to be personal.
4. The Council's legal opinion is contained in a letter from is solicitors, Russell Kennedy, dated 23 July 2008. It notes that the opening lines of the covenant refer to the purchaser Henry Zeplin covenanting with the vendor Solomon Green 'his executors administrators and transferees' (italics emphasis added). This is the only reference to transferees of the covenantee. From this reference, without disclosing any legal analysis, the legal opinion simply draws a conclusion that "although the covenant provides a remedy for breach of the covenant by way of payment of ascertained and liquidated damages to Solomon Green his executors or administrators (not the transferees), the benefit of the covenant extends to all the land in the subdivision held by Solomon Green at the time of transfer". The subject land was within a subdivision of 91 allotments, 16 of which had already been transferred at the time of the transfer to Henry Zeplin - the inference being that the other 75 allotments would have the benefit of the covenant.
5. Unfortunately, the Council was not legally represented before me to explain the analysis (if any) that underscored Russell Kennedy's opinion, nor does it appear that any further advice was sought from Russell Kennedy after this application was made to the Tribunal or after the applicant's detailed outline of submissions was circulated to the Council.
6. In my view, the Russell Kennedy opinion appears to be based on an unsupported assumption. I agree with the applicant that the interpretation of the terms of a restrictive covenant, including whether there is clear language annexing the benefit of the covenant to identifiable land, is a question to be gleaned from the plain meaning of the words used[2]. Here, the covenant does not expressly (or even implicitly) identify any land to which the benefit of the covenant attaches, and the only land mentioned is the land burdened. There is no reference to other land in a subdivision, nor indeed to any other land anywhere that Solomon Green then owned and that he might have contemplated transferring to others with a benefit of the covenant. Despite the reference to 'transferees' in the early part of the covenant, the wording of the covenant would suggest that its real benefit is directed to the covenantee and his executors or administrators personally, particularly with the remedy for breach simply being liquidated damages. There is nothing apparent from the wording of the covenant to support Russell Kennedy's view that certain transferees of other nearby land in the same subdivision, but not identified in the covenant, were intended to benefit from the covenant, nor that the benefit touched or concerned that other land. There is none of the common wording of the era to expressly annex the benefit of the covenant to other identifiable land such as "the land remaining untransferred" in the parent title.
7. It follows that the third element required for the burden of the restrictive covenant to run with the land is not established.
8. More particularly, there is no identifiable land over which the benefit of the covenant runs. This has ramifications for s 60(5) of the Planning and Environment Act 1987. Under that provision, a responsible authority must not grant a permit that allows for the variation or removal of a covenant unless it is satisfied that the owner of any land benefited by the covenant will be unlikely to suffer detriment of any kind. Here, based on a proper construction of the covenant, there is no such benefited land and therefore no such owners. However, pursuant to s 60(5) and based on the Russell Kennedy opinion, the Council had apparently notified the owners of other land in the original subdivision of the applicant's application to vary or remove the covenant and refused that application based on objections received. On a proper construction of the covenant, the Council ought not to have notified those owners, and the objections received did not provide any basis under s 60(5) to refuse the application to vary or remove the covenant. [I note in passing that the applicant had apparently in good faith notified the objectors of this application under s 149B, although none sought to join the proceeding.]
9. It also follows that there is no identifiable beneficiary in whose favour the covenant is now enforceable. Arguably, the obligations owed personally to Solomon Green his executors or administrators have long since extinguished. [I note in passing though that two descendants of Solomon Green have been traced, both of whom were prepared to formally waive the obligation under the covenant insofar as it might still apply personally in their favour. The Council however raised no argument that those descendants might be beneficiaries under the covenant, and I doubt that they are.]
10. The second planning aspect in the matter before me arises from Condition 2 in Planning Permit GE/PP-21181/2008. That permit authorises a development that would not comply with the covenant (if still enforceable), and Condition 2 provides:

This permit does not come into effect and building and works must not commence until the restrictive covenant contained in Instrument of Transfer No. 0592063 has been varied so that it will not be breached by the proposal.

1. This condition follows s 62(1)(aa) of the Planning and Environment Act 1987, which requires such a condition on a permit if the grant of the permit would authorise anything that would result in a breach of a registered restrictive covenant.
2. This issue was not directly addressed by the Council in the proceeding before me. However, it follows from the foregoing discussion that the covenant is no longer enforceable as a registered restrictive covenant. The burden of the covenant has not run with the land as the third required element is not met (i.e. no identifiable benefited land). Equally, there is no beneficiary in whose favour the covenant is now enforceable. It would appear that the Council has imposed Condition 2 based upon its misconception as to the proper construction of the covenant for planning purposes.
3. For the purpose of ss 60(4) and 62(1)(aa) of the Planning and Environment Act 1987, I do not therefore consider that the development and use of the subject land in accordance with Planning Permit GE/PP-21181/2008 would result in an enforceable breach of the covenant.
4. I have made limited declarations to give effect to the views I have expressed, albeit not as broadly stated as those declarations sought by the applicant. The parties indicated a likelihood that, if the covenant was no longer enforceable, and particularly if I came to a view that there was no benefited land, the applicant and Council would come to some arrangement to facilitate the approved development - if necessary by a further application to vary or remove the covenant, or through the deletion of Condition 2 on the permit. There is no application before me in relation to these possible options. I have made no consequential orders in this regard and leave these arrangements to the parties.

[1] See Bradbrook & Neave 'Easements and Restrictive Covenants in Australia' (2nd ed) at [14.19] and the cases cited therein.

[2] Following Tonks v Tonks [2003] VSC 195; (2003) 11 VR 124