1. Sections 62(5) and 62(6) of the Planning and Environment Act 1987 provide as follows:

(5) In deciding to grant a permit, the responsible authority may -

(a) include a condition required to implement an approved development contributions plan; or

(b) include a condition requiring specified works, services or facilities to be provided or paid for in accordance with an agreement under section 173; or

(c) include a condition that specified works, services or facilities that the responsible authority considers necessary to be provided on or to the land or other land as a result of the grant of the permit be -

(iii) provided or paid for partly by the applicant where the remaining cost is to be met by any Minister, public authority or municipal council providing the works, services or facilities.

(6) The responsible authority must not include in a permit a condition requiring a person to pay an amount for or provide works, services or facilities except -

(a) in accordance with subsection (5) or section 46N; or

(b) a condition that a planning scheme requires to be included as referred to in subsection (1)(a); or

(c) a condition that a referral authority requires to be included as referred to in subsection (1)(a).

1. Condition 6 requires the provision of a public pedestrian accessway. There is no requirement for the land to be transferred to or vested in the council. It is simply the accessway and its ongoing maintenance that must be provided by the respective property owners at some stage in the future.
2. I find that the provision of a public pedestrian accessway as required by condition 6 is a requirement to provide works within the meaning of sections 62(5) and 62(6)[3]. Works is defined in the Act to include any change to the natural of existing condition or topography of land. The construction of a pedestrian accessway falls within this definition.
3. Section 62(6) provides that a permit cannot contain a condition requiring a person to provide works except in accordance with the criteria set out in paragraphs (a) - (c). In the present case, paragraphs (b) and (c) are not relevant and nor is the reference to section 46N. Thus under paragraph (a) it is only if the works are to be provided in accordance with subsection 62(5) that the condition may be included.
4. Turning to section 62(5), paragraph (a) is not relevant because the condition is not required to implement an approved development contributions plan.
5. Paragraph (b) is not relevant in the context of this proceeding because although the works are being required under a section 173 agreement, the agreement is not voluntary. In a series of cases[4], the Tribunal has held that section 62(5)(b) only applies to a section 173 agreement that is voluntary. In Cameron Manor Pty Ltd v Mornington Peninsula SC[5], I said:

[68] ... The parties must agree to a mutually acceptable outcome. In the absence of voluntary agreement, a responsible authority cannot rely on section 62(5)(b) to impose a condition requiring a section 173 agreement that would otherwise contravene the provisions of the Act. Section 62(5)(b) only exempts a condition that would otherwise offend section 62(6) if it is entirely voluntary.

1. The condition would appear to fall within paragraph (c) because the works are to be provided by the applicant. It is not proposed that they are to be provided or paid for by multiple persons.
2. Section 62(5)(c)(i) refers to works provided by the applicant. Condition 6 contemplates that the accessway will be provided on both Lots 1 and 2 by the respective property owners of those lots at the time when provision of the accessway is triggered by development of Lot 1.
3. The reference to "the applicant" in paragraph (c) is a reference to the permit applicant, which in the present case is the landowner of the subject land. This comprises both proposed Lots 1 and 2. Thus it is the landowner of the subject land upon whom the obligation falls solely to provide the works. I do not consider it is relevant that ownership of the land may fragment once the subdivision is carried out. The provisions of Division 2 of Part 9 of the Act relating to section 173 agreements enable obligations created by the condition to be passed on to subsequent owners of the land.
4. For the purpose of interpreting section 62(5)(c), I find that the obligation to provide the works rests on the owner of the subject land, which includes both proposed lots 1 and 2. Therefore, the requirements of section 62(5)(c) are met in terms that the works must be provided by the applicant.
5. Section 62(2)(f) enables conditions which are otherwise valid to be implemented by way of a section 173 agreement. This is a different situation to the type of voluntary section 173 agreement contemplated by paragraph (b) of section 62(5), which enables something to be done by way of a section 173 agreement that may not otherwise be permitted under section 62(5).
6. I am therefore satisfied that subject to the specified works being "necessary to be provided onto the land ... as a result of the grant of the permit", condition 6 is authorised by section 62(5).

IS CONDITION 6 AN OTHERWISE VALID PERMIT CONDITION?

1. The issue of whether the works are necessary as a result of the grant of the permit needs to be considered in the context of the common law tests of validity of a permit condition.
2. Having regard to the words in section 62(5)(c) that the works must be considered "necessary" to be provided on or to the land, the applicant advocated a very narrow interpretation that focussed on whether the subdivision itself generated a need for the works. It submitted that the subdivision of itself does not generate a need for a public pedestrian accessway (on either Lot 1 or Lot 2). Public pedestrian access is readily available to both lots within Burwood Highway and Tyner Road. It would provide very little or no benefit to either lot in terms of improving pedestrian access to the Knox Central Commercial Area because there is already very good pedestrian access available.
3. However, in my view, the applicant has misconceived the ambit of the words in paragraph (c). It has considered whether the works are necessary as a result of the proposed subdivision, whereas the words in paragraph (c) refer to whether the works are necessary as a result of the grant of the permit. This is a much broader test.
4. In considering what is necessary as a result of the grant of the permit, it is appropriate to consider the decision guidelines set out in clause 65 of the planning scheme. The opening words of this clause provide:

Because a permit can be granted does not imply that a permit should or will be granted.

The responsible authority must decide whether the proposal will produce acceptable outcomes in terms of the decision guidelines of this clause. [emphasis added]

1. Clause 65.01 provides that before deciding on an application or approval of a plan, the responsible authority must consider, as appropriate, a range of matters including:
   • The State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies.
   • The purpose of the zone, overlay or other provision.
   • Any matter required to be considered in the zone, overlay or other provision.
   • The orderly planning of the area.
2. In addition, clause 65.02, which deals with applications to subdivide land, provides that the responsible authority must also consider, as appropriate:
   • The existing use and possible future development of the land and nearby land.
   • The movement of pedestrians and vehicles throughout the subdivision and the ease of access to all lots.
3. These decision guidelines require consideration of the local planning policy in clause 22.04 for Knox Central Principal Activity Centre. The subject land is part of the area to which this policy applies. The objectives of the policy[6] include:
   • To implement the land use and development vision for Knox Central based on the Knox Central Urban Design Framework.
   • To improve access to and throughout the activity centre, and improve legibility for all forms of transport including pedestrians.
4. The policy applies where a permit is required for the use and/or development of land. Development of land includes subdivision. The policy set out in clause 22.04-3 includes a section on transport and movement, which includes the policy to improve accessibility throughout the area for pedestrians and cyclists.
5. Within the Knox Central Urban Design Framework (July 2005) there are numerous references to the need to improve the movement network between precincts, placing priority on pedestrian and cyclist movements throughout the area and providing safe and convenient pedestrian and cyclist links to surrounding residential areas in all directions. There is also a specific provision relating to the Rembrandts Triangle precinct. Although the section relates more to future use and built form development than the current subdivision, it includes a precinct design objective to "achieve safe and legible access to and through the site to facilitate site redevelopment."
6. The actual framework plan showing the transport and movement pattern envisaged for the study area[7] shows proposed roads through the precinct, two legs of which represent the accessways on Lots 1 and 2 referred to in condition 6. Whilst these routes are shown as roads on the Framework, the council says that its views on implementation have modified and at this stage it is only interested in securing public pedestrian and cycle access.
7. I find that there is a clear policy basis within the planning scheme for the provision of a public pedestrian accessway within Lot 1 and Lot 2 as required by condition 6. I find that the timing of its provision relating to the redevelopment of Lot 1 (rather than immediately) is reasonable. The location of the accessway within Lot 1 is flexible and will depend upon the nature of its redevelopment. The need for this type of flexibility is inherent in the Framework.
8. This two lot subdivision creates Lot 1 as a separate, developable site, separating it from Lot 2, which is now used as a school. Although the school says that it does not want the public pedestrian accessway on its land, I do not consider this view should override the clear policy basis for providing the accessway. The proposed location of the accessway along the northern boundary of Lot 2 will not interfere with the operation of the school and its site layout. It is a logical and convenient location.
9. The subdivision will fragment the ownership of the land. It is in the interests of orderly planning to flag by way of a section 173 agreement that a public pedestrian/cycle accessway through the land will need to be provided in the future as an important aspect of implementing the planning policy applicable to this specific precinct as part of the wider Knox Central Principal Activity Centre, and to establish responsibility for its provision.
10. I therefore find that as a result of the grant of this permit, the provision of a public pedestrian/cycle accessway through the site is necessary, although its actual construction will be deferred until further development of Lot 1.

1. I was referred to various authorities about what constitutes the test of validity of a permit condition. Neither party referred me to the Supreme Court case of Melbourne Water Corporation v Domus Design Pty Ltd[8]. Nevertheless, in this recent case Gillard J analyses in detail the proper test of validity of conditions in a planning permit. With respect to the test in Pyx Granite Co Ltd v Ministry of Housing and Local Government[9], that to be valid, a condition in a planning permit must fairly and reasonably relate to the permitted development, His Honour was quite emphatic that this was an English case that does not represent the law in this country[10]. Instead, he said, the High Court in Alan Commercial Constructions Pty Ltd v The Council of the Municipality of North Sydney[11] has laid down the test for Australia[12].
2. In Alan Commercial Constructions, Walsh J delivered the leading judgment. Barwick CJ, Menzies and Windeyer JJ agreed. In stating the test, Walsh J said[13]:

In accordance with a well-recognised rule, s.40(1) (of the Planning Ordinance) ought to be understood (quite apart from the limitation contained in its opening words) not as giving an unlimited discretion as to the conditions which may be imposed, but as conferring a power to impose conditions which are reasonably capable of being regarded as related to the purpose for which the function of the authority is being exercised, as ascertained from a consideration of the scheme and of the Act under which it is made. This purpose may be conveniently described, in accordance with the expression used by Lord Jenkins in Fawcett Properties Ltd v Buckingham County Council, as being 'the implementation of planning policy', provided that it is borne in mind that it is from the Act and from any relevant provisions of the ordinance, and not from some pre-conceived general notion of what constitutes planning, that the scope of planning policy is to be ascertained.

1. This is the test that Harris J of the Supreme Court endorsed in 271 William Street Pty Ltd v City of Melbourne[14], which was one of the cases referred to me.
2. Having identified that the Walsh J test was the applicable one in Australia, Gillard J went on in Melbourne Water Corporation v Domus Design Pty Ltd to state:

[64] In order to determine the validity of a condition imposed in a planning matter where the power to impose a condition is expressed in general terms, the Tribunal is required to undertake the following step by step process:

(i) Identify and state the terms of the proposed condition;

(ii) Consider and determine the relevant planning policy by considering all relevant legislation dealing with the topic, which would not necessarily be confined to planning legislation and schemes;

(iii) Consider and determine whether the condition was reasonably capable of being related to the implementation of that planning policy.

1. Appling this process to the present case, I have earlier identified and stated the terms of the proposed condition. I have considered and determined the relevant planning policy and I have found that condition 6 is reasonably capable of being related to the implementation of that planning policy. On this basis, I find that condition 6 is a valid planning permit condition.

1. I have remarked previously that condition 6 is awkwardly worded, but I do not consider that the wording requires amendment. It will be important though for the provisions of the actual section 173 agreement to be clear and unambiguous. A clearer plan than was presented to me at the hearing should be included in the agreement.
2. With respect to this proceeding, the application for review fails. Condition 6 should be retained in the amended permit.

6. Prior to the issue of a Statement of Compliance the owner of the land must enter into an agreement under Section 173 of the Planning and Environment Act 1987 with the Responsible Authority...

a) When Lot 1 is re-developed, a public pedestrian accessway (to a minimum width of 3.0m and accessible to the public at all times) shall be provided within Lot 1 and part of Lot 2 between Tyner Road and the southern boundary of Lot 1 by the respective property owners. The path within Lot 2 as per the attached plan, shall be constructed within one (1) month of the connecting pathway being provided on Lot 1, or as otherwise agreed by the Responsible Authority.

b) The purpose of the accessway is to provide improved pedestrian/cycling circulation and permeability throughout the Knox Central Activity Centre and a linkage to the proposed "Civic Way" as described in the "Knox Central Urban Design Framework" and shall be maintained by the respective property owners.

[3] See Harmon Group Pty Ltd v Casey CC [2006] VCAT 629

[4] Such as Naprelac v Baw Baw SC [2005] VCAT 956; Springhaven Property Group Pty Ltd v Whittlesea CC [2005] VCAT 816; and Cameron Manor Pty Ltd v Mornington Peninsula SC (Red Dot) [2007] VCAT 1822

[5] [2007] VCAT 1822

[7] Knox Central Urban Design Framework (July 2005) Figure 21, page 48

[8] [2007] VSC 114

[9] [1958] 1 QB 554

[10] [2007] VSC 114 at [33], [49], [51] - [53],

[11] [1970] HCA 42, (1970) 123 CLR 490

[12] [2007] VSC 114 at [49] and [63]

[14] [1975] VicRp 15; [1975] VR 156 at 162