13 The description by the Tribunal of the proposed restriction on height was:

"That no building on Lot 2 shall exceed a wall height of 8 metres above the level of the frontage at Seacombe Grove."

14 This same description was included in the town planning evidence given by C A Heggen on behalf of the permit applicant at the Tribunal hearing. The written submission made on behalf of the permit applicant by his solicitors, Best Hooper, at the Tribunal hearing stated:

"On 27 August, 1990 the Council determined to grant the permit sought subject to conditions including conditions controlling the development which may be constructed on the new allotment being limited to one detached house with no wall to exceed 8 metres in height above the street abuttal."

15 The officer's report to Council, which led to the notice of determination that was the subject of the Tribunal hearing, repeated the stated intention that "no building exceed the height of 8 metres above the level at the frontage at Seacombe Grove." However, in proposed condition 2 the restriction was expressed simply as:

"No building on Lot 2 shall include a wall exceeding 8 metres in height."

16 Prior to consideration of the permit by the Council, the permit applicant's consultant had written to Mr and Mrs G T Lampard (the applicant's parents) regarding the proposed subdivision giving notice of the permit application and stating:

"We would also like to advise that the purpose of proposed Subdivision relates to the creation of an allotment (Lot 2) as the site for a single dwelling house. The Resultant title will bear a covenant providing for the following:-

1. That not more than 1 dwelling house be constructed on the lot.

2. That the height of the dwelling be restricted to a height of 8 metres relative to the lot frontage at Seacombe Grove.

3. That the palm tree in the north west region of the lot not be removed."

17 The permit applicant, Philip McNaughton, also wrote to Mr G Lampard prior to consideration of the permit application by the Council in the following terms:

"I am writing to you regarding our application for a planning permit to divide No 37-39 Seacombe Grove into two allotments.

There appears to be some misunderstanding over what is proposed and we would seek to dispel any fears you may have.

In approximate terms the two lots will be of 8,000 and 16,000 square feet, both well in excess of the minimum required by council of 6,350 square feet.

Lot 2, closest to Seacombe Grove, will have a number of restrictive covenants placed on title. Those are:

1. One residence only can be constructed on the site.

2. A maximum building height of 8 metres.

3. A 6 metre building setback from the West boundary.

4. The large palm tree remains in its present position.

It is also proposed that the tennis pavilion will be reduced to single storey height or demolished."

18 When the section 173 agreement was prepared as required by condition 2 of the permit the restriction on height was expressed in the following terms:

"(b) No building to be constructed on Lot 2 shall include a wall exceeding 8 metres in height above natural ground level immediately below the point of the wall being measured."

19 We find that the intention of the Council and the permit applicant at the time when the permit was considered was that no wall would exceed 8 metres in height above the height of the lot frontage at Seacombe Grove. This intent was expressed in slightly different words in different documents but there is a consistent reference to Seacombe Grove in correspondence from the permit applicant's consultant (who was a licensed surveyor), the Council officer who reported to Council, the permit applicant's town planning consultant and solicitor, and the Administrative Appeals Tribunal member who decided the case.

20 The reference to the wall height being relative to the height of the lot at Seacombe Grove was not translated into condition 2 of the permit, which simply refers to "no building including a wall exceeding 8 metres in height". However, this is then amplified in the section 173 agreement to include the reference to a wall not exceeding 8 metres in height "above natural ground level immediately below the point of the wall being measured". The question is whether "natural ground level" in this context refers to the actual level of the ground prior to construction at varying points of the site where the building is located, or whether it refers to natural ground level at Seacombe Grove, which was accepted by the parties to be 6.35 AHD.

21 It is first relevant to consider what is meant by the term "natural ground level". A number of authorities were referred to us on this point. In the case of Shire of Gisborne v King [1994] 1VR 364, Nathan J had to consider the meaning of the phrase "alteration to the natural conditions or the topography" in regard to a case where the land owner had disturbed the topography of land that had previously been disturbed since European settlement. His Honour said at page 370:

"To my mind the term alteration to the natural conditions or topography means that the surface or topography which must not be disturbed is that which immediately predates the making of the application. That is the configuration of the land, whether disturbed or otherwise as a result of prior European industrial pastoral or mining activities, but being that which exists at the time an application is made. This conclusion bears the merit of common sense. There will be many applications to rectify the results of extractive industries by neglect so as to restore the land to its pre European shape or else render it productive in some other way."

22 The issue of what is natural ground level was considered by the Tribunal in Banyule City Council v Zumpano (application No 1999/88547). The Tribunal considered various authorities, including Shire of Gisborne v King and the Tribunal case of Tribe v Greater Geelong City Council [2000] VCAT 444 2 VPR 224. The Tribunal in Zumpano's case concluded it should adopt the interpretations of the Supreme Court in Shire of Gisborne v King and the Tribunal in Tribe v Greater Geelong City Council. It said:

"[19] In the case of Tribe -v.- Greater Geelong City Council [1999] 2 V.P.R. 224, this Tribunal had to determine the meaning of natural ground level for the purpose of the Greater Geelong Planning Scheme. The learned Tribunal member, after referring to the New South Wales case of Rizzi -v.- Rockdale Municipal Council (1994) 85LGERA 113 concluded (at page 227 of the report): "

"From the above decision at first instance of the Land and Environment Court and that of the Court of Appeal the Tribunal concludes that to determine the natural ground level, it is necessary for the Responsible Authority (or this Tribunal on appeal) to endeavour to determine what was or is the natural ground level of the land before it was disturbed in any way by excavation, levelling or filling for the purpose of the development such as the laying of foundations and the building of a house and outbuildings."

[20] The decision of Nathan J. in the case of Shire of Gisborne -v.- King is, quite obviously, binding on this Tribunal. The question with which his Honour was concerned in that case is not exactly the same as that which confronts us in this case, but we consider that we should follow it and the Tribunal's earlier decision in Tribe -v.- Greater Geelong City Council."

23 These cases all refer to the interpretation of natural ground level where this expression is used in statutes and planning schemes. In the present case we are interpreting an agreement between parties. In this context what is important is what the intention of the parties was when they used this expression.

24 The natural contours of the subject land have been altered by successive developments over many years. At the time of the subdivision, when the plan annexed to the original agreement and the survey feature and level plan dated 26 April 2001 were prepared, the site varied in level all over it due to prior development. A large part of the site had been excavated to accommodate a former tennis court. This was surrounded by retaining walls with higher ground and garden areas surrounding it. To the north was a large palm tree and an in ground swimming pool, again surrounded by retaining walls.

25 This was a highly modified site with varying ground levels. In the context of setting a benchmark from which to measure a height restriction for future development, we consider that it is unlikely that one or more of the existing levels of the site immediately prior to development of the dwelling would have been selected as representing the "natural ground level". The level at Seacombe Grove is much more likely to represent what the parties meant by natural ground level than the various altered levels existing across the subject site.

26 In the circumstances of this case we consider that there is an ambiguity in the terms of clause 6(b) about what is deemed to be natural ground level. To resolve this ambiguity, we need to ascertain and give effect to the intention of the parties at the time when they entered the agreement. We find from the documentary evidence before us that at the time when the parties entered the original agreement they understood natural ground level to refer to the ground level at the frontage of the lot at Seacombe Grove. Based on the inclusion of clause 6(c) in the new agreement we find that this is also the intention of the parties in respect of the new agreement. This new agreement was entered into after the completion of the new house on the allotment and with full knowledge of the dispute which is now the subject of this application for declaration. By the inclusion of clause 6(c) in the new agreement the parties have expressly sought to clarify their understanding of the meaning of the agreement and confirm that the dwelling as constructed in accordance with the plans referred to in clause 6(c) satisfies the other covenants in the agreement.

27 We find that the meaning of "wall" in the context of the agreement in the present case refers to external perimeter walls. We do not consider it refers to internal walls or the walls of the lift shaft.

28 We consider that when interpreting the agreement we must, so far as possible, give effect its intent.

29 The situation is akin to situation dealt with by Justice Morris in Poci Brothers Pty Ltd v Bayside City Council [2003] VCAT 1884, 15 VPR 236. In that case the Tribunal was required to interpret a height control expressed in a number of storeys. It was a situation where there was a height limit of two storeys but an internal mezzanine floor had been constructed, which was not externally visible but which could be construed as resulting in a building of three storeys. Justice Morris held that:

•

Building height should not be assessed by simply counting every possible level or storey and reaching a conclusion by addition, but by approaching a task in a practical and common sense manner.

•

The way to characterise the number of storeys a building has for the purpose of interpreting a height control of this nature is by observation of the external built form and by reference to the purpose of their control.

"[12] ....it does not follow from the fact that the building has three storeys within that the height of the building is the height of a three storey building."

31 In the present case, we consider that if the intent of the parties was that the building not exceed 8 metres in height, the restriction would have been expressed in these terms. There is no point in referring to a wall height when in most cases the external wall height will be less than the overall building height, which must also include the height of the roof. Therefore, although the correspondence to Mr Lampard senior prior to the Council's consideration of the permit application for subdivision referred to "maximum building height" and "the height of the dwelling", by the time that the notice of decision was issued, the appeal was heard and determined by the Administrative Appeals Tribunal and the section 173 agreement was entered, it was clearly the intention of the parties that the 8 metre height referred to "walls" not the height of the building.

32 We do not consider that the findings of the Tribunal in Banyule City Council v Zumpano should lead us to a different conclusion. The provision in Zumpano's case that the Tribunal was called upon to interpret and apply was found in a schedule to the Significant Landscape Overlay which provided that a planning permit is not required for a dwelling unless the height of any part of a wall is more than 8 metres above the natural surface level of the ground directly below it, or any part of the building is more than 12 metres above the natural surface level of the ground directly below it.

33 Zumpano was a case where the original plans of the dwelling showed walls all in excess of 8 metres on a third level. Subsequently, non-compliance with the planning scheme was identified and the plans were changed. The rooms on the third level remained, but instead of external walls visible from the outside the external skin on these walls was deleted and the roof was extended over the walls and the external windows, which now appeared through the roofing material, in the form of a "mansard" roof.

34 The Tribunal found that these walls, that is the stud walls within the "mansard" roof, were walls within the meaning of the overlay. The Tribunal said:

They are stud walls and they support the main roof. As the outer walls to the room in question, they cannot sensibly be described as anything other than walls. The mere fact that they are not visible from the outside does not make them something other than walls.

35 The applicant sought to argue that we should similarly find that the walls of the roof terrace, which are set back from the external perimeter of the building and contained within the overall roofline but which are nevertheless externally visible, are walls to which the restriction applies.

36 We disagree. In Zumpano's case the mansard roof was a sham and represented nothing more than a slightly sloping external wall to the dwelling. In the present case, we are not dealing with a mansard roof but a conventional pitched roof within the profile of which the roof terrace is inset. We do not consider that the rear wall of the roof terrace can be counted as a wall for the purpose of interpreting the agreement. It does not increase the height of the building or alter its profile. Although the Tribunal in Zumpano's case found that the stud wall concealed by the mansard roof was a wall for the purpose of interpreting the schedule to the overlay even though it was not externally visible, the Tribunal looked to the purpose of the height thresholds in the overlay schedule in reaching its conclusions. It found that the purpose of the height thresholds was to determine if a planning permit is required because of the potential for buildings of a certain height above natural surface level to compromise the purpose of the significant landscape schedule. It found the height triggers were intended to capture proposals which should be subjected to a comprehensive planning assessment against the purposes of the Significant Landscape Overlay and the decision guidelines which seek to conserve and enhance the character of the significant landscape that the overlay applies to. The sham nature of the mansard roof meant that it was therefore not appropriate to measure the height of the wall between the ground and the under side of the eaves of the mansard roof for the purpose of deciding whether or not exemption from the planning requirement applied.

37 We note that the Tribunal in Zumpano's case was dealing with the effective height of the external walls of the building in question whether those "walls" were described as walls or roof. We consider that in the present case we must likewise consider what the external walls of the building are. The meaning of the word "wall" must be given its ordinary meaning within the context in which it is used. In the context of the agreement there is a maximum height applicable to any wall but the context inherently recognises that the overall height of the building will be greater. We therefore find that in the section 173 agreement the word "wall" means an external perimeter wall above which there will be a roof profile. We find that the west and south walls of the roof terrace are therefore not to be construed as "a wall" for the purpose of interpreting and applying clause 6(b) of the agreement because they are not perimeter walls.

38 For similar reasons we conclude that the walls of the lift shaft should not be considered in the application of clause 6(b) either. We consider that the lift shaft is akin to a chimney or other appurtenance and would not normally be construed as a wall in the context of interpreting a restriction on wall height as distinct from building height.

39 In light of our findings that natural ground level must be measured from Seacombe Grove and that the only walls relevant for assessing compliance with clause 6(b) of the agreement are external perimeter walls, we find that there are no walls of this nature that exceed 8 metres in height above natural ground level immediately below the point of the wall being measured. Hence we find that there is no breach of this covenant in the section 173 agreement.

40 The background to clause 6(f) relating to the "club house" building is as follows. This was an existing two storey pavilion located on the southern boundary of the land which had served the former tennis court. The lot boundary between lots 1 and 2 of the plan of subdivision approved by the Administrative Appeals Tribunal in 1990 ran through and dissected the club house building. The clause in the section 173 agreement was inserted by way of supplementary agreement to address this situation.

41 However in November 2003 the Council approved plan of subdivision PS448363N which realigned the boundary between lot 1 and lot 2 so that the lot boundary no longer runs through the club building. It also created a walkway to the beach as part of the subject land along the southern boundary of lot 1. Plan of subdivision PS4488363N was registered on 27 February 2004 and effectively negates the purpose of clause 6(f).

42 We find that as the lot boundary now no longer runs through the club house building there is no need to demolish the building or to construct the wall referred to in clause 6(f).

43 The applicant submitted that when lot 2 on the original plan of subdivision was sold and transferred to the respondent in October 1999 this clause in the agreement was not complied with and therefore there was a breach of this covenant in the agreement. It is irrelevant that subsequent plans of subdivision have been registered rendering the purpose of the clause irrelevant. The breach has been ongoing and applicant continues to seek a declaration regarding this breach.

44 First, we are not prepared to make a declaration regarding any breach of clause 6(f) of the agreement regarding the club house building based on the principal of de minimus non curat lex[1]. If ever there was a breach of this clause, events have overtaken it and rendered it futile. Absolutely no purpose would be served in making a declaration regarding it. In light of the circumstances we find it surprising that the clause was retained in the new agreement, which was only entered in September 2004 after the plan of subdivision which amended the boundary between Lot 1 and Lot 2 was registered.

45 With respect to clause 6(b), even though we have found there is no breach of this clause, we would have declined to make a declaration in any event. We do not consider that any purpose would have been served by making the declaration sought. The applicant is not a party to the section 173 agreement. The two parties to the agreement, the Council and the respondent, are both satisfied with the dwelling that has been constructed and do not consider that it breaches the agreement or the intent of the agreement. If the purpose of the declaration is a precursor to an enforcement order application by the applicant, it is difficult to see why such an application was not made in the first place. It is open to any person to apply to the Tribunal for an enforcement order if a use or development of land contravenes an agreement under section 173. However the declaration process may have been used because it is not likely that an application for enforcement order would have been successful. Construction of the dwelling commenced in April 2002. The external walls and roofing was substantially completed in December 2002. There has therefore been a significant delay in bringing proceedings. It is not as though the applicant was unaware of the facts. We acknowledge that the applicant raised concerns about the dwelling with the Council. But by delaying bringing action the applicant has forfeited whatever rights he may have had to relief. Mr Wren, on behalf of the respondent, referred us to the equitable defence of laches, which is described in a leading text on equity in the following terms:

"It is a defence which requires that a defendant can successfully resist an equitable (although not legal) claim made against him if he can demonstrate that the plaintiff, by delaying the institution or prosecution of his case, has either: (a) acquiesed in the defendants conduct; or (b) caused the defendant to alter his position in reasonable reliance on the plaintiff's acceptance of the status quo, or otherwise permitted a situation to arise which it would be unjust to disturb: Lindsey Petroleum Co v Hurd [2] (1874) LR 5 PC 221.

46 Similar considerations apply to the equitable remedy of declarations.

47 In the present case, we find that it would be unjust to the respondent to grant any relief in the form of either an enforcement order or a declaration because of the delay in bringing the proceedings and the potential consequences for the applicant. This is a substantial dwelling reportedly worth in the vicinity of $6-8 million. The consequence of accepting the applicant's interpretation of clause 6(b) would result in the demolition of the building. Whilst the applicant asserted that his mother's house has suffered loss of amenity by virtue of construction of the dwelling on the subject land by reason of its visual bulk, overlooking and reduction in views, the ultimate remedy of demolition that the applicant seeks is out of all proportion to these effects.

48 We were referred to the comments of Dixon J in Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336 at 362 where he said:

"The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences following from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences."

49 It was submitted by the respondent and the Council that, given the seriousness of the consequences of a finding in favour of the applicant's submissions, the applicant has not satisfied the high burden of proof required. We have already made a finding that does not support the applicant's submissions. We consider the principal enunciated by the High Court in Briginshaw v Briginshaw, and followed by the Tribunal in Tribe v Greater Geelong City Council, is an additional reason for refusing to make a declaration in this case.

50 We therefore repeat our conclusion that even if breach of the agreement had been established, we would not have made the declaration sought because no purpose would have been served by it.

51 At the conclusion of the hearing the respondent made an application for costs against the applicant on the basis that the purpose of these proceedings has been nothing but mischievous.

52 The matters canvassed before the Tribunal in support of the respondent's claim for costs indicates the bad blood which exists between the applicant and respondent. We have concluded that we do not need to delve into the relationship between the parties for the purpose of establishing whether these proceedings have been brought vexatiously. We consider there are not sufficient grounds for us to depart from the normal rule that each party is to bear their own costs in a proceeding.

53 The only salutary outcome we can see as a consequence of this proceeding is the demonstration it offers of the need to be precise when drafting permit conditions and section 173 agreements so that they accurately reflect the true intention of parties at the time. We consider there has been considerable sloppiness in this respect in the documentation of the intent and understanding of the Council and the permit applicant at the time when the subdivision was being considered. More attention to detail at that time would have saved much acrimony, expense and waste of resources 14 years later.

[1] The law does not concern itself with trifles.

[2] Equity: Doctrines and Remedies by Meagher Gummow and Kehanes (4th Edition) page 1031.