appellant. Application for review granted; decision of the responsible authority to refuse permit set aside; permit granted under cl 52.02 of the Manningham Planning Scheme to proceed under s 23 of the...
Key principles
The question whether a lot has the benefit of a restrictive covenant governed by reference to 'registered proprietors for the time being' is determined by the order and timing of...
Where owners of land who actually have the benefit of a restrictive covenant have not objected to an application to remove or amend that covenant, the absence of such objections...
Section 60(5)(a) requires the decision-maker to be satisfied it is 'unlikely' that owners of land with the benefit of the covenant will suffer 'any detriment of any kind'...
If there are objections by owners of land with the benefit of the covenant and those objections are not vexatious or made in bad faith, s 60(5)(b) operates to make granting the...
Issues before the court
Who must be given notice and who may validly object to an application under s 23 of the Subdivision Act to remove or amend a restrictive covenant?
Plain English Summary
Applicants sought permission to amend a restrictive covenant so they could have a second dwelling. The council refused because it believed nearby residents who objected held the covenant's benefit. VCAT examined title registrations, found the objectors did not have that benefit because their transfers were registered before the review site's transfer, and concluded no owners with the benefit had objected. The tribunal found it unlikely any benefited owner would suffer detriment and, exercising its discretion, granted a permit to amend the covenant and directed the council to issue it.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
Deep Dive
1,849 words · generated 26/07/2026
What happened
The applicants, Frank and Evie Kastoras, applied for a permit under s 23 of the Subdivision Act 1988 to remove or amend a restrictive covenant affecting Lot 72 (4 Cumberland Court, Doncaster East) so they could erect an additional dwelling on the allotment (Information; Proposal). The Manningham City Council refused the permit, relying on s 60(5) of the Planning and Environment Act 1987 (PE Act), because it understood that one or more owners of land benefiting from the covenant had objected to the proposed removal or amendment (Grounds of Refusal; para 2, para 14).
When does the benefit of a restrictive covenant pass to successors in title?
Does s 60(5)(a) permit amendment/removal of a restrictive covenant where no owners with the benefit have objected?
Does granting a permit to remove or amend a covenant automatically permit subsequent subdivision or development?
Cited legislation
No linked legislation citations have been extracted yet.
On review at VCAT the central factual and legal issue became whether the persons who lodged objections, the Argyropoulos and Manos households, in fact held the benefit of the restrictive covenant. The council had given notice broadly to all owners in Plan LP145851 (paras 6, 8), which included both benefited and non-benefited lots; three objections were received, one withdrawn (para 10).
Detailed title searches revealed that the Argyropoulos land had been transferred some three months before the first transfer of the review site, and consequently did not receive the benefit of the covenant (para 16). Similarly, the Manos lot had been registered before the review site transfer; therefore it too did not receive the benefit (paras 20-24). Because no owner of land with the benefit of the covenant had objected, s 60(5)(b) did not apply (para 5). The tribunal then considered s 60(5)(a) and whether it was "unlikely" that any owner with the benefit would suffer "any detriment of any kind" if the covenant were amended (paras 6-11). Finding no substantive indication of likely detriment and noting that removal of the covenant did not circumvent planning controls for subsequent development, VCAT granted a permit to amend the covenant to allow one additional single dwelling and directed the Responsible Authority to issue the permit (Orders; paras 13-16).
Why the court decided this way
Two legal strands determined the outcome: first, the statutory preconditions in s 60(5) PE Act governing applications to remove or amend restrictive covenants by permit under s 23 of the Subdivision Act; second, the property-law principle that the benefit of a restrictive covenant passes to successors who are registered proprietors.
Who is a relevant objector under s 60(5): The tribunal emphasised that notice and objection rights attach to owners of land that have the benefit of the covenant, not merely to all neighbours in a plan of subdivision (para 6). The council had given blanket notice to all owners in the plan; that procedural choice gave rise to participation by some who were in truth not legally entitled to object (para 7). Because the Argyropoulos and Manos lots did not, in law, have the covenant's benefit, their objections could not trigger s 60(5)(b) (paras 15-16, 21-24, 5).
Registration timing decides benefit: The covenant's reference to "registered proprietors for the time being" led the tribunal to treat registration at the Titles Office as the operative event for benefit passing (paras 26-27, 21-24). The tribunal accepted the applicants' submission that the order/time of registration controls, and that the precise temporal gap is irrelevant, whether minutes or months (para 23). Title records showed the Manos lot was registered before the review site; the Argyropoulos lot was already registered earlier, and therefore neither obtained benefit when the review site first transferred (paras 16, 21-24).
Application of s 60(5)(a): With no benefited-owner objections, the tribunal assessed whether it was "unlikely" that any owner with the benefit would suffer any detriment if the covenant were amended (paras 6-11). The test is probabilistic, not absolute: "unlikely" does not mean impossible. The tribunal considered relevant contextual matters, subdivision layout, the allotment's nature and the covenant wording, found no substantive basis to expect detriment, and regarded the absence of objections from any benefited owners (who had been given notice) as strong evidence the risk of detriment was low (paras 10-11).
Discretionary permit stage: Having satisfied the statutory preconditions, the tribunal exercised its discretion to grant the permit but noted removal of a covenant does not authorise subsequent subdivision or building without separate planning permission under the planning scheme; neighbours will have opportunity to object to any such later applications (paras 13-15). The tribunal was content to grant an amendment rather than full removal, reflecting the applicants' revised preference (para 16).
Before and after state of the law
Before this decision the statutory framework under s 60 PE Act and s 23 Subdivision Act was already established: the tribunal must consider whether owners of benefited land would be likely to suffer detriment, and objections by benefited owners engage s 60(5)(b). This VCAT decision applies those statutory tests to particular facts and clarifies the practical effect of registration timing on who is a benefited owner.
Key clarifications:
The covenant's reference to "registered proprietors for the time being" should be read to mean the benefit passes on registration at the Titles Office; therefore, the chronology of registration events can be determinative (paras 21-24, 26-27).
The tribunal reiterated that absence of objections by benefited owners who were notified is an important, albeit not conclusive, factor in assessing the "unlikely" detriment threshold under s 60(5)(a) (paras 10-11).
The decision emphasises the procedural importance of accurate title checks prior to refusal: the responsible authority's initial refusal rested on an assumption later shown incorrect by title searches (paras 14-16, 19-24).
The judgment does not purport to create new legal doctrine but applies existing statutory tests and property-law concepts to the facts, offering a concrete example for practitioners: check registration times and the precise class of benefited proprietors before relying on objections to block a s 23 application.
Key passages with plain-English translation
Passage (para 6): "When the responsible authority received the permit application there was a question of giving notice of it... What was done was that all owners of all land in the plan of subdivision concerned were given written notice of the application."
Plain-English: The council sent notice to every owner in the subdivision, even though only some actually had a legal right to object because they had the covenant's benefit.
Passage (para 16): "The search material reveals that the Argyropoulos land was transferred some three months before the first transfer of the review site. As such, it does not have the benefit of the covenant."
Plain-English: Records show Argyropoulos bought and had their title registered earlier than the review site changed hands, so they do not legally get the covenant's protections tied to the review site's first transfer.
Passage (para 21): "However, a closer examination... indicates that the first transfer of the Manos land was registered before the first transfer of the review site..."
Plain-English: A careful title check shows Manos' registration happened earlier, which means they too did not acquire the benefit the covenant would have given after the review site's first transfer.
Passage (para 23): "He submitted, correctly in my view, that it does not make any difference whether the time lapse is three minutes, three days, three months or three years."
Plain-English: What matters is who was registered first, not how much earlier; any interval is irrelevant for determining benefit.
Passage (para 11): "The responsible authority believed that they were the owners of land with the benefit of the covenant... That has not proved to be the situation."
Plain-English: The council was mistaken about who had the right to object; title checks showed the objectors did not have the legal standing.
What fact patterns trigger this precedent
This decision is directly relevant where:
An application under s 23 Subdivision Act seeks removal or amendment of a restrictive covenant tied to a plan of subdivision, and the covenant's wording refers to "registered proprietors" or similar language (paras 15, 26-27).
Multiple lots within a staged subdivision were transferred at around the same time, raising questions about which transfers occurred first at the Titles Office (paras 20-24).
A responsible authority has given notice to all owners in a plan, generating objections from persons who may not legally hold the covenant's benefit (paras 6-7, 10-11).
The tribunal must assess the s 60(5)(a) "unlikely to suffer any detriment" standard in a context where no benefited-owner objections exist (paras 8-11).
In such fact patterns practitioners should order detailed title searches, examine the order/times on transfer registrations, and assess whether any objectors are actually benefited proprietors before relying on s 60(5)(b) to resist a permit.
How later courts have treated it
The present judgment itself does not report subsequent appellate or judicial treatment. The decision is a VCAT tribunal determination applying statutory provisions and registered-title principles to fact-specific circumstances. To determine how later courts or tribunals have treated Kastoras v Manningham CC [2009] VCAT 2370, one must consult case citators, legal databases and subsequent determinations referring to this VCAT decision. The judgment contains no discussion of later treatment or authoritative appellate endorsement or disapproval (the Reasons focus on the facts and statutory application; see paras 21-24, 10-11).
Still-open questions
Exact legal weight of registration timing language: The tribunal treated the covenant's reference to "registered proprietors for the time being" as indicating registration is the decisive event for benefit passing (paras 26-27). That interpretation is persuasive in context, but the decision does not fully canvass contrary textual or equitable arguments that might arise where the covenant's drafting is ambiguous or where contracts created prior to registration include different intention. Lower courts or appellate courts could elaborate on when equitable exceptions might displace the registration-based rule.
Scope of 'any detriment of any kind': The tribunal regarded the expression as broad but subject to de minimis exclusion and declined to resolve debates about bracketed words '(including any perceived detriment)' (para 7). Future decisions may further define the boundary between trivial impacts and materially relevant detriment, or the extent to which 'perceived' detriment should be treated.
Evidence required to show an objection is vexatious or not in good faith under s 60(5)(b): The tribunal observed that proving an objection is vexatious or in bad faith is usually difficult (para 17). There remains uncertainty about standards and evidentiary thresholds for making that showing in cases where the objector is a benefited owner.
Procedural best practice for notice: The tribunal criticised broad notice to all subdivision owners as potentially inviting irrelevant participation (para 7). There is scope for administrative practice notes or guidance on how responsible authorities should identify benefited proprietors to avoid unnecessary objections and attendant refusals based on mistaken standing.
Interaction with equitable doctrines: The tribunal's reliance on registration is practical, but equity sometimes recognises interests arising pre-registration; the judgment does not explore circumstances where equitable priorities or proprietary estoppel might alter who is deemed to have the benefit. Those nuanced conflicts remain open for adjudication.
Practitioners must therefore treat the decision as a fact-driven application of established principles: check registration chronologies, ensure notice is directed to true benefited proprietors, and prepare evidence addressing the s 60(5)(a) detriment assessment.
Judgment (16 paragraphs)
[1]
Kastoras v Manningham CC [2009] VCAT 2370 (17 November 2009)
This application for review is granted. The decision of the responsible authority to refuse to grant a permit is set aside and a permit is granted pursuant to cl 52.02 of the Manningham Planning Scheme for the applicants to proceed under s 23 of the Subdivision Act1988 to vary the restrictive covenant affecting the land known as Lot 72 on Plan of Subdivision 145851 being the land in Certificate of Title Volume 9611 Folio 996 the terms of which restrictive covenant appear in Transfer of Land M162239B lodged at the Titles Office so that item (a) therein is amended to read:
[4]
(a) erect on each lot hereby sold any building other than one private dwelling house together with normal outbuildings and garages except that one additional single dwelling may be erected on the said lot.
Residential 1 Zone under the Manningham Planning Scheme.
[12]
Lot 72 on Plan of Subdivision No 145851 being the Land and Certificate of Title Volume 9611, Folio 996
[13]
In accordance with the provisions of Section 60 (5) of the Planning and Environment Act1987, the responsible authority cannot be satisfied that the owners of the land benefited by the restriction will be unlikely to suffer detriment of any kind as a consequence of the removal of the restriction.
[14]
This case concerns an application for a planning permit to proceed pursuant to s 23 of the Subdivision Act1988 to remove or amend a restrictive covenant.
This is an applicant's appeal against a decision of the responsible authority to refuse to grant a permit. The grounds of the refusal are set out above. That refusal was on the basis that the responsible authority understood that one or more objectors who owned land having the benefit of the covenant had objected to the proposal.
I conducted a hearing in relation to this case on 4 March 2009. The same people appeared on that occasion except that Ms Manos did not then appear.
I gave an interim decision with remarks and directions in a document dated 13 March 2009. There were, at that stage, some uncertainties about various relevant points as discussed in the remarks attached to that document.
The further hearing in relation to which this determination is given was conducted on 28 October 2009. In the meantime, and in preparation for that hearing, some further investigations were carried out on behalf of the applicants. Further title searches were made and copies of relevant transfers of land were obtained.
When the responsible authority received the permit application there was a question of giving notice of it. It was necessary to give notice to the owners of land that had the benefit of the covenant. What was done was that all owners of all land in the plan of subdivision concerned were given written notice of the application. Some of the land in the subdivision has the benefit of the restrictive covenant applying to the review site, and some lots in the subdivision do not have that benefit. However, with individual written notice being sent to all the owners of all the lots, it can be taken that all the owners of land with the benefit have received notice, even if some owners of land that does not have the benefit of the covenant, also received notice.
[15]
And the said M.T. Salisbury Pty. Ltd for itself its respective heirs administrators executors and transferees the registered proprietor or proprietors for the time being of the lot hereby sold...
[16]
Although lacking punctuation, there appears to be a gap intended between "exectors and transferees" and "the registered proprietor or proprietors for the time being".
Although the point may not be beyond argument, I think this means that heirs, administrators, executors and transferees may become the registered proprietor or proprietors and that, it is when attaining that status that the burden of the covenant falls upon them. An heir inheriting land burdened by the covenant can hardly be bound by the covenant until he or she inherits. Indeed, I think that all this means that the original covenant binds the first successor in title when that successor, whether an heir, administrator, executor or transferee, becomes the registered proprietor. That occurs upon registration of the land transfer instrument whereby that person becomes the registered proprietor.
On this basis, I accept the submission of Mr McKenzie that the first purchaser of the Manos land became its registered proprietor before the first purchaser of the review site became its registered proprietor. Accordingly, I accept his submission that the Manos land does not have the benefit of the covenant that applies to the review land.
No contrary submissions were made although the other people present and participating in the hearing were not lawyers or represented by lawyers and accordingly might well have found all this analysis rather hard to follow, much less argue against.
On this basis, I find that neither the Argyropoulos land nor the Manos land is the land with the benefit of the covenant relating to the review site. Accordingly, the attempted objections by the owners of those pieces of land are not objections by the owners of land having the benefit of the covenant. There are no other objections. Accordingly, there are no objections from owners of land with the benefit of the covenant and therefore s 60 (5) (b) does not have to be taken into consideration in the present case.
That leaves s 60 (5) (a). I must still be satisfied, in accordance with that provision, that it is unlikely that the owner of land with the benefit of the covenant will suffer any detriment of any kind (including any perceived detriment) if the restrictive covenant is removed or amended.
There has been debate in previous cases as to the meaning of the words in brackets, and as to whether they add anything to the notion of any detriment of any kind. I do not think it is necessary, for the purposes of the present case, to go into that debate. I think the expression "any detriment of any kind" includes anything that is a detriment, even a quite minor detriment, as long as it is more than . That expression is a contraction of the legal Latin maxim , which means that the law does not concern itself with trifles. In other words, a detriment that is trifling in the circumstances could be disregarded.
Parties
Applicant/Plaintiff:
Kastoras
Respondent/Defendant:
Manningham CC [2009] VCAT 2370
AI Analysis
Outcomeappellant
Disposition:
Application for review granted; decision of the responsible authority to refuse permit set aside; permit granted under cl 52.02 of the Manningham Planning Scheme to proceed under s 23 of the Subdivision Act 1988 to vary the restrictive covenant so item (a) is amended to allow one additional single dwelling on the lot; Responsible Authority directed under s 85(1)(b)(ii) of the Planning and Environment Act 1987 to issue the permit (Orders).
It is really only the owners of land with the benefit of the covenant that are relevant for present purposes. The disadvantage of giving notice to others, such as the owners of land that does not have the benefit of the covenant, is that those people receive notice as if they were relevant potential objectors able to object to the permit application. This sometimes, and unfortunately, means that people then seek to participate in the proceeding, and to appear at the hearing, when in fact they are not relevant and have no legal basis for participating. That has happened in the present case.
The relevant plan of subdivision is LP145851. That is a plan of subdivision constituted by three sheets which depict some 61 lots numbered 30 to 91 respectively. A careful examination of the plan shows that it has only three sheets and that it defines only lots 30 to 91 inclusive.
It appears that this is the second stage of a larger subdivision project. I assume that lots 1 to 29 inclusive were in a first stage, but that first stage has become a separate subdivision. I am therefore satisfied that the giving of notice to the owners of lots 30 to 91 covered what is necessary in relation to this case.
The responsible authority received three purported objections to the permit application. One has since been withdrawn. The other two purported objections were that of Bill and Georgia Argyropoulos and another of Dimitra and George Manos.
The responsible authority believed that they were the owners of land with the benefit of the covenant, and therefore relevant as objectors. That has not proved to be the situation.
George and Dimitra Manos are the owners of lot 35 on the Plan of Subdivision, whilst Bill and Georgia Argyropoulos are the owners of lot 37 on that plan. Those two properties front the bowl of the court of Viewmont Court, which is part of the subdivision. Viewmont Court is a cul de sac that runs north off Schafter Drive.
The review site is an unusually large allotment with a frontage to the court bowl of Cumberland Court. Cumberland Court is another cul de sac that runs south of Schafter Drive. These two courts meet Schafter Drive in "T intersections". Those intersections are close together, but not quite opposite each other. This does mean that the review site is at some distance from the Manos and Argyropoulos properties. The restrictive covenant in question was created before 1991 so that the provisions of s 60 (5) of the Planning and Environment Act1987 (PE Act) apply to this proceeding, rather than the provisions in subsection (2) of s 60 of that Act.
The responsible authority considered itself more or less obliged to refuse the permit application because it believed that the Argyropoulos land, or at least the Manos land, was land having the benefit of the covenant where the owners had objected.
The further investigations that have been carried out between the two hearings reveal that this is not the situation. The restrictive covenant provides that the benefit of it goes to the registered proprietors for the time being of land that was in the subdivision, or at any rate in the ownership of the subdivider, at the time the review site was first transferred to a new owner.
The search material reveals that the Argyropoulos land was transferred some three months before the first transfer of the review site. As such, it does not have the benefit of the covenant. Whilst there could theoretically be some possible exception to that proposition, I have no evidence or submissions to the effect that such theoretical exception could apply in this case.
That leaves for consideration the question of whether the Manos land has the benefit of the covenant. If it has the benefit, s 60 (5) (b) PE Act will make it very difficult for this application for review to succeed. The existence of the Manos objection would, in those circumstances, mean that the permit sought cannot be granted unless the responsible authority (or this tribunal on review) is satisfied that the objection was vexatious or not made in good faith. It is usually difficult (though not necessarily impossible) to show that an objection is vexatious or not made in good faith.
On the other hand, if the Manos land does not have the benefit of the covenant, paragraph (b) of s 60 (5) will not apply. In those circumstances, it will only be necessary to consider paragraph (a) of that subsection.
By the time of the hearing before me on 28 October 2009 it was appreciated, at least by the permit applicant and the responsible authority, that the Argyropoulos land did not have the benefit of the covenant on the review site land. However, until the hearing, the responsible authority, and Ms Manos, thought that the Manos land did have that benefit. The solicitors originally acting for the applicants, and originally instructing Mr McKenzie, thought that was the situation. However, it appears that this was based on a too cursory examination of the title documents. Mr McKenzie, on behalf of the applicants, has now submitted that the Manos land does not have the benefit. That is based on a more careful and detailed examination of the documents.
After subdivision the first transfer of the review site was to the same purchaser who was the first purchaser of the Manos land. Not only that, but the respective Transfers of Land each bear the same date. It appears that the previous solicitors for the applicants relied on that as indicating the Manos land would have the benefit of the covenant.
However, a closer examination of the Transfer of Land documents indicates that the first transfer of the Manos land was registered before the first transfer of the review site. The first purchaser of both of them became the registered proprietor of the Manos land before it became the registered proprietor of the review site.
This order of registration appears from three separate numbers that appear on each of the respective Transfers of Land. These numbers are notations indicating an order and a time.
Mr McKenzie submitted that, as long as the Manos land was first transferred prior to the review site, it does not receive the benefit of the covenant. He submitted, correctly in my view, that it does not make any difference whether the time lapse is three minutes, three days, three months or three years.
This submission depends upon a further submission to the effect that it is the registration at the Titles Office, and the order and time of such registrations, that is of importance.
The restrictive covenant may well have started its life as a condition in the contract of sale between the original seller and the original purchaser of the review site. If it was part of the contract of sale of land between them, no doubt it bound them from the time the contract was entered.
The law makes provision to enable a restrictive covenant to "run with the land". In other words, the restriction on the land can be made to pass to subsequent owners of the land that is burdened. Likewise, the benefit can pass to successive owners of the land with the benefit.
The covenant may bind the original contractors, but when does the burden or benefit pass to subsequent owners of the burdened land and benefited land? The covenant itself refers to registered proprietors of land. That is a term commonly used in the Transfer of Land Act. The covenant also refers to such expressions as heirs, administrators, executors and trustees. That is in the context that reads:
de minimis
de minimis non curat lex
Section 60 (5) (a) is not simple to understand, but it does not impose an absolute requirement. It contains the word "unlikely".
Nevertheless, it is necessary to consider the likelihood or unlikelihood of detriment being suffered by any owner of land with the benefit of the covenant. The consideration under paragraph (a) is not confined to those who have objected.
That said, it does not mean that the circumstance of there being no objection by owners of land with the benefit is irrelevant to the assessment that is to be made. One must look at all relevant circumstances, but amongst those relevant circumstances is the fact that owners of land with the benefit of the covenant who have been given notice of the application for a permit would be likely to object if they thought they would suffer detriment. In this case, I consider the absence of such objections makes it unlikely that any such owners will suffer detriment.
There is not absolute proof of that. It is quite possible that an owner might suffer detriment and yet not object. I therefore considered whether there are circumstances which are relevant that might weight against the proposition that detriment is unlikely. In this context, one can consider the layout of the subdivision, the nature of the allotment concerned and the wording and effect of the covenant in the circumstances. I find nothing in this case of substance that would persuade me to such a view. I have therefore come to the conclusion that detriment to any owners of land with the benefit of the covenant is unlikely. Accordingly, I find that the partial prohibitions imposed by s 60 (5) do not prohibit the granting of the permit sought in this case.
That might not necessarily be the end of the matter. It means that it is open to grant the permit sought, but does not overrule or render obsolete the subsequent discretion to decide whether or not to grant the permit.
Again, in relation to that discretion, it is necessary to take proper and relevant matters into consideration. I do not think that this means applying the general provisions of the planning scheme. There is a distinction between private property rights such as those that arise in relation to a restrictive covenant on the one hand, and public planning policy considerations, arising under the planning scheme and in the public interest, on the other.
The main thing that the applicants seek in this case is that they wish to construct a second house on their lot or to subdivide the lot to provide the site for a second house. Neither such subdivision, nor such development without the subdivision, can proceed just because the restrictive covenant is removed. Either the subdivision, or the development of a second house, requires planning permission under the planning scheme. Neighbours, whether or not they own land with the benefit of the covenant, and including those who sought to object in the present case, will have their opportunity as objectors in relation to any such planning permit proposals.
So far as the present case is concerned, and in relation to whether permission should be given to proceed under s 23 of the Subdivision Act, I can see no reason of any substance why the permission should not be granted. I therefore propose to grant the application for review together with a permit.
The original application was for the complete removal of the restrictive covenant. However, the applicants are content to seek an amendment to that part of the restrictive covenant restricting the number of houses. I will therefore grant the permit in those terms.