Jasbe Petroleum v Baw Baw SC [2019] VCAT 392 (5 July 2019)

1. The hearing of this matter came before us, with the initial scheduled dates being 4-8 March 2019. The initial one and a half days of hearing time was used simply to deal with the legal 'characterisation' arguments, which can be summarised as follows.
2. In brief, Council argued that the two 'food offerings' associated with the proposed 'Service station' constitutes the subject land being used for a second distinct purpose of 'Convenience restaurant'. Council rejected any suggestion that these food offerings would be ancillary to the 'Service station' use. This is in the situation where a 'Convenience restaurant' is a prohibited use in the Farming Zone which applies here.
3. Hence Council's case at its highest was that the Tribunal has no jurisdiction to approve the proposed food offerings. This was supported by the objectors but contested by the applicant.
4. The applicant's preferred position was that the two food offerings form part of an overall integrated proposal which should be characterised as the use of the subject land for the purposes of a 'Service centre', which is a permissive use. This submission was put with particular reference to the earlier decision of Typhoon Pty Ltd v Macedon Ranges SC [2004] VCAT 913.
5. In the alternative, the applicant urged the Tribunal to find that the whole proposal should be characterised as the one use of 'Service station', including an ancillary food offering. The applicant's least preferred position, which it acknowledged is problematic, is that the use of 'Service station' as defined can inherently encompass the two significant food offerings proposed here i.e. without needing to rely on 'ancillary use' principles.
6. After completing the legal submissions, we heard the merits case of Council and then the objectors. Ms Hicks for the applicant then began calling her expert witnesses. In the situation where the main objector group were wishing to rely upon certain recent Monash University survey work with respect to businesses operating in Yarragon, this survey data had not been pre-circulated. Ms Hicks expressed concern that this survey data was the type of information typically presented by an expert witness. Ms Hicks submitted that the applicant's economic witness Mr Quick should be given further time to review this data, potentially ask further questions and in turn have the right to issue a supplementary report.
7. From this discussion, what emerged was a consensus that the following procedural steps should be followed. Rather than trying to complete her whole case over the allocated five hearing days, Ms Hicks would complete presenting all of the non-economic expert evidence (which she did), then the hearing would be adjourned (which we did). The Tribunal then issued procedural orders dated 12 March 2019, setting down two more hearing days on 22-23 May 2019 and further procedural steps for the updating of the survey data and of Mr Quick's 'economics' expert report (and these further steps were duly carried out).
8. When the hearing resumed on 22 May 2019, Mr Quick presented his expert evidence and dealt with cross-examination, with the benefit of the further information and where by that stage he had issued both his original expert report and a supplementary report. Ms Hicks then presented her written 'Closing submissions' and various attachments, including the recent decision of MG Pastoral Pty Ltd v Surf Coast SC [2019] VCAT 502. In this decision, the Tribunal in essence approved a service station and camping & caravan park, to be located on the Princes Highway to the west of Winchelsea. Finally, there was 'rights of reply on new points' and a discussion of the updated draft permit conditions.
9. By sitting late on 22 May 2019, we did not require the extra hearing day scheduled for the next day.
10. One aspect of the draft permit conditions warrants further comment. The draft permit conditions include Condition 1(a), which, in brief, requires that the two food offerings be deleted from the final plans put forward for endorsement. Near the end of the hearing on 22 May 2019, there was discussion of the fact that if the two food offerings were 'severed' from the plans before the Tribunal, there would be real challenges in terms of the flow-on effects with how the following elements of the balance of the proposal would then operate in practice - the inside toilets that are currently 'sandwiched' between the two food offering areas, how the freed-up space would be used if the two drive-through facilities were removed, and whether there would be any pro-rata reduction in the on-site car parking if the end-position was a substantially smaller main building.
11. As part of this discussion, we made it clear that as a matter of due process and 'orderly planning', we saw some real limits to how substantially the current proposal could be 'scaled back' through a permit condition such as draft Condition 1(a).

1. There was little (if any) dispute between the parties about the key 'principles of law' to be applied here. These principles arise from certain leading cases, which characterise the existing use(s) in question and whether any 'ancillary' uses exist. Rather, it was hotly disputed as to how these principles and relevant caselaw should be applied to the pertinent facts in question.
2. Hence it seems unnecessary to repeat in these reasons the key principles, at least where they arise from the landmark decision of Cascone & Anor v City of Whittlesea (1993) 11 AATR 175. Rather, I have for convenience set out in the Appendix to this decision the helpful explanation of Cascone at [9] of the Council legal written submission.
3. It is trite to acknowledge that Shire of Perth v O'Keefe [1964] HCA 37; (1964) 110 CLR 529 is authority that in seeking to discern the purpose for which a site is being used, one seeks to establish the 'real and substantial purpose' in question.
4. In her final oral submissions on this characterisation dispute, Ms Marcus provided certain case citator information. She submitted that this information and the relevant case law points to the Typhoon decision having been sparsely cited and rarely (if ever) followed, since it was handed down in 2004.
5. By way of context, the Typhoon decision involved a site which was not located directly on a Victorian freeway, but immediately next to one via the relevant freeway on-ramp and off-ramp. It was common ground that the proposed 'petrol, convenience items and food offering' for which permission was sought satisfied all of the elements of a 'Freeway service centre' as defined, apart from having direct access to a freeway. The food offering would be a McDonalds and a KFC, which would each have their own drive-through. Council argued that the proposal constituted the three separate uses of 'Service station', 'Convenience shop' and a 'Convenience restaurant', whereas the applicant contended that it was the one overall integrated proposal of the innominate use of a 'Service centre'. The Tribunal found the applicant's position more persuasive on this issue and approved the proposal as the innominate use of a 'Service centre'.
6. The cases which Ms Marcus tabled and relied on (i.e. where the Tribunal had preferred to utilise a defined land use term rather than utilising an innominate use such as 'Service centre') included at , (Red Dot) at and (Red Dot) at .

1. As part of her oral submissions on the legal issue, Ms Marcus drew attention to one aspect of the decision RW and MM Anderson Nominees Pty Ltd v Greater Geelong CC [2016] VCAT 1904. This case involved a proposed fuel facility on Torquay Road in Mt Duneed. The main building would be very large at 700 sqm in floor area, along with 16 fuel pumps. The Tribunal found at [14] that the proposed 'convenience shopping' offering still fell within the defined land use term of 'Service station', since that definition expressly anticipates the sale of 'convenience goods'.
2. At [16] the Tribunal decision records that the main building would also provide for a café with 47 internal seats and a covered external area. It is also of interest that on page 4 of 31, the Tribunal's procedural orders include the deletion of the word 'restaurant' from the description of the proposal which the Tribunal went on to approve.
3. Ms Marcus was critical of the fact that nowhere else in these Anderson Nominees Reasons is there any explanation of how the Tribunal arrived at the view that a 47 seat café came within the definition of 'Service station' or was ancillary to that use. Ms Marcus queried whether the Tribunal's true intention in that case might have been to substitute the land use term 'café' instead of 'restaurant', but where (in the final result) the orders made did not do this.
4. I find persuasive Ms Marcus' main proposition here - that the 'characterisation' analysis in this Anderson Nominees case involving the site at Mt Duneed should be treated with real caution, with how in practice it dealt with the '47 seat café' aspect of the proposal. I say 'real caution' because I agree that it is unhelpful that this decision is silent regarding how this Division of the Tribunal came to the view that a café with as many as 47 seats was not a separate use. I also agree that it is confusing that the orders include removing the land use term of 'restaurant' from the preamble being approved, but where there is no explanation found in the Reasons of why in practice this was done.
5. It follows that I also agree with Marcus that this situation 'throws a shadow over' any other more recent Tribunal decision which relies on this aspect of this Anderson Nominees decision. In particular, I refer here to the decision Keen & Ors v Mildura RCC [2017] VCAT 219, which involved a proposal described in the opening sentence of the Reasons as simply a 'Service station'. Later in that opening paragraph, there is reference to the intended main building also providing for convenience goods "...and a café providing both indoor and outdoor seating".

1. Turning now to the 'ancillary use' issue, there is a useful summary of the relevant caselaw at [65-70] of the Council written legal submission, a copy of which is retained on the Tribunal file. Self-evidently these types of 'ancillary use' disputes turn on their own facts and tend to be a matter of 'fact and degree'. It is helpful to reproduce below [65] from this written legal submission, noting that the citation for Lizzio's case is [1983] HCA 22:

1. I move now to the applicant's submission that the whole proposal should be regarded as the one integrated 'Service centre'. For the following reasons, that position is rejected.
2. It seems fair to say that the applicant very much 'hung its hat' on the precedent of the Typhoon decision. That is, the applicant urged the Tribunal to find that the facts here are very similar to those before the Tribunal in Typhoon, and that the approach taken in Typhoon is sound and can also be applied here i.e. utilising the innominate use of 'Service centre' (which is a permissive use).
3. It firstly counts against this 'reliance upon Typhoon' that this case (on first principles) runs counter to the Clause 73.03 preference to utilise a suitably defined land use term(s).
4. Second, I am conscious of Council's submission that Typhoon in practice has become an 'orphan decision', which to Council's understanding has never been overtly applied/relied upon in any subsequent Tribunal decision since it was handed down in 2004. I accept there to be real weight in this submission. See for example the discussion at [40] above of three cases which have discussed the approach taken in Typhoon but declined to follow it. In her oral submissions, Ms Hicks properly acknowledged that it may well be that no other subsequent Tribunal decision has overtly followed the Typhoon decision.
5. Third, there are some factual differences of some note, between the circumstances here vis-a-vis those in Typhoon. Notably, the proposal in Typhoon met all the requirements for on-site facilities for a 'Freeway service centre' as defined, whereas the proposal before me lacks a playground, public phone or information board. I accept that the second and third of these could be readily added with a suitable permit condition. Whilst in theory a playground could be likewise added, it is not obvious in practice where it would be sited, relative to the main building. For many young families on the road, a playground would I expect be a highly valued feature.
6. Fourth, in relation to the issue of 'need', the proposed facility before me (for west-bound traffic on the highway) lies immediately to the west of the existing Uniting service station and the shops in the main Yarragon township. Compare this to Typhoon, where I understand that the review site was considerably further away from the nearest alternative food or petrol offering. Hence I am struggling to see that the applicant here can make the same type of 'need' case that was before DP Gibson in I acknowledge that the proposal here is intended to particularly cater for west-bound truck drivers, but do not see this as a full answer to this 'need' issue.

1. Our initial impression is to endorse this summary. In other words, if you take out the large range of issues which can be readily 'conditioned' and now that the 'characterisation issue' has been resolved, what seems left is the quite confined issue of whether or not the proposal enjoys an acceptable level of strategic planning support on land zoned Farming Zone, plus a dollop of debate about 'overdevelopment'. These are now issues for another day, bearing in mind that the proposal itself needs to be properly settled, before the planning merits can be properly assessed.
2. The second proviso relates to the 'strategic support' issue just mentioned. It seems appropriate to highlight several confusing and/or unhelpful aspects of this debate that arose during the hearing:
   • There was considerable discussion of Clause 21.04 in the Planning Scheme. This discussion was made no easier by the pages of this clause being un-numbered.
   • If you look at what is described as the 'Yarragon Structure Plan' on one of the middle pages in Clause 21.04, the subject land entirely falls within a dotted black line. The 'legend' for this plan shows this black dotted line as representing the 'Township boundary'. The applicant understandably relied on this situation, in arguing that the proposal self-evidently would not be an 'out-of-town' development. By contrast, Council relied on the fact that the Yarragon Structure Plan October 2010 at page 44 (blessed numbering) features a similar plan of Yarragon, but where the subject land falls outside of the apparent edge of the township as shown with a black dotted line. This inconsistency between the two plans reflects poorly on our planning system and needs to be properly resolved as soon as possible.
   • At times Council and the objectors criticised the proposal as being inconsistent with the purposes of the Farming Zone, where it was argued that the area on which the facility would be located is still capable of being used for farming purposes. At other times, Council and the objectors noted that the relevant Clause 21.04 plan for Yarragon shows the subject land (and the adjacent land to the south) as 'Future General Residential Zone'. They criticised the proposal as providing inadequate amenity protection for the anticipated future dwellings further to the south. This dual approach seems very open to the criticism of Council and the objectors 'wanting to have their cake and eat it too', with how they approached the 'strategic planning merits' of the proposal. Surely common sense indicates that you either take 'farming' or the 'future residential use' (but not both) as your focus point here.
3. The third proviso is as follows. The proposal did not include provision for any signage, noting that essentially the type of signage one would anticipate for a service station is prohibited in the Farming Zone. We see some weight in Council's criticism that it is rare for an applicant to seek planning approval for a service station, where the proposal is silent regarding signage. On the one hand, this does raise issues of 'piece-meal development', where the leading decision of was critical of permit applications that lack significant associated permissions which are necessarily involved in the overall proposal being put forward. On the other, we acknowledge that this could be addressed by a site-specific re-zoning or a specific site control (at Clause 51.01), and hence do not see this situation as fatal or futile in itself.

(1964) 110 CLR 529