1. I rule that in this proceeding, a subdivision along zone boundaries is not lawful in light of the minimum lot requirement of 40 hectares in the Farming Zone (Barabool Land System).

1. I have been asked to determine the following question of law:
   • Is a subdivision along zone boundaries lawful in the light of the minimum lot requirement of 40 hectares in the Farming Zone (Barrabool Land System)?
2. The question arises in the context of an application for review of a planning permit for subdivision where the land falls within two zones - Farming and Township. The subdivision proposes to subdivide the land along the zone boundary with one lot of 9523m2 in the Farming Zone and 6 smaller lots ranging in size from 1493m2 - 1810m2 in the Township Zone.
3. Clause 35.07-3 of the Greater Geelong Planning Scheme imposes a minimum lot size of 40 hectares on any lot created by a subdivision within the Farming Zone. The proposed subdivision will create a lot located within the Farming Zone that is less than 40 hectares. Indeed, the entire land, which is the subject of the subdivision, is less than 40 hectares. The size of the proposed lots in the Township Zone would be permissible.
4. The primary issue is whether, when land is proposed to be subdivided and it is within two (or more) zones, any new lot must satisfy the minimum area requirements of both zones. A variation of the issue is whether, in the same circumstances, the land can be subdivided along the zone boundary.
5. Four cases, which have been decided by the Tribunal but which have taken different approaches, were referred to by the parties. They are:
   • Miller & Merrigan Pty Ltd v Yarra Ranges SC[1]
   • Rumpf v Melton SC[2]
   • Siomos V Banyule CC[3]
   • Guastella v Kingston CC[4]

As a starting point, it is relevant to set out the facts and the decision in each of these cases.

1. Miller & Merrigan PL v Yarra Ranges SC was a decision by Justice Stuart Morris. The land was in two zones - Residential 1 and Rural. The minimum lot size in the Rural Zone was 18 hectares. The total area of the land was less than 11 hectares. It was proposed to subdivide the land into two lots along the zone boundary. The lot in the Rural Zone would have an area of 10.1 hectare, which was less than the minimum lot size for the Rural Zone.
2. In reaching his decision that a permit could be granted for the subdivision, which Justice Morris considered "is clearly the commonsense and intended outcome of the planning scheme", he said:

[5] The interpretation of clause 35.01-4 must be considered in the context of the whole scheme, including the maps which form part of the scheme. The maps show that the existing lot is intended to be used partly for residential development, with the major portion being retained for rural use. It is incomprehensible that the authors of the scheme would have imagined that this would be done without the subdivision of the land. Hence the provision in clause 35.01-4 must give way to the clear purpose of the scheme as evidenced in the planning scheme map. Perhaps another way of considering the matter would be to regard the 18 hectare minimum in the Rural Zone as applying to a subdivision which actually divided land within the Rural Zone, as opposed to a subdivision dividing land along the boundary of the Residential Zone and the Rural Zone.

1. Rumpf v Melton SC was a decision which I made where I found that subdivision is not permitted unless the requirements of both zones are met. In this case, a strip of the subject land was in a Rural Conservation Zone whilst the remainder (and bulk) of the land was in the Green Wedge Zone. The land had a total area of 55 hectares. Under the provisions of the Green Wedge Zone, the land could be subdivided into two lots because it complied with the minimum subdivision size requirements of this zone, which was 12 hectares. However, under the Rural Conservation Zone, the minimum allotment size was 40 hectares. Consequently, under this zone, the subdivision was prohibited. The proposed subdivision did not follow the boundary of the two zones. The reason for my decision was as follows:

[5] ... The Victoria Planning Provisions and Melton Planning Scheme do not contain special provisions for land in two zones. Clause 61.05 of the scheme provides that land may be used or developed only in accordance with the planning scheme. This means that all provisions of the planning scheme must be complied with. Thus any use or development proposal, including a subdivision, must meet the requirement of both zones where land is included in two zones. As the proposed subdivision does not meet the requirements of the Rural Conservation Zone, it is prohibited.

1. Siomos v Banyule CC was decided by Senior Member Byard. The case concerned a four lot subdivision, which straddled two zones - the Low Density Residential Zone (minimum subdivision size of 4000m2) and the Rural Conservation Zone (minimum subdivision size of 2 hectares). It seems that lots 1 and 2, which were in the Low Density Residential Zone, complied with the minimum subdivision size of 4000m2. Lot 4, which was in the Rural Conservation Zone, complied with the minimum subdivision size of 2 hectares. The problem was with proposed lot 3 with an area of 6796m2, which straddled the two zones. It met the minimum subdivision size in the Low Density Residential Zone but was less than the minimum lot size in the Rural Conservation Zone.
2. Senior Member Byard refused to accept the argument that compliance with one of the zone provisions was sufficient, and held that the zone requirements of each of the zones had to be satisfied. He held that the subdivision was unlawful because it contravened the minimum lot area requirement for subdivision of land in the Rural Conservation Zone.
3. Guastella v Kingston CC was decided by Member Komesaroff. The case involved a two lot subdivision of land in the Green Wedge Zone and Residential 3 Zone. The subdivision was proposed along the zone boundary. The proposed lot in the Green Wedge Zone was 3.403 hectares in area, which was considerably less than the minimum subdivision size of 40 hectares. The proposed lot in the Residential 3 Zone was 6347m2. Surrounding land in the Residential 3 Zone was generally in lot sizes of 450 - 500m2.
4. Member Komesaroff distinguished the facts of this case from those in Rumpf and Siomos and relied on Miller & Merrigan to grant a permit for the subdivision. She said:

[21] I distinguish the facts of the present case from Rumpf and Siomos. In this case, the proposed lots do not straddle two zones. They do the opposite; they divide the land exactly along the zone boundary. The land within the Green Wedge zone is not being subdivided at all. It is being separated from the land in the Residential 3 zone. I apply the principle of Miller & Merrigan PL v Yarra Ranges SC.

[22] It is my opinion that the subdivision is lawful. The planning authorities, who were well aware of the existence of the Green Wedge Zone and the fact that the allotment straddled both the R3 and GW zones, would not have placed the land in a Residential 3 zone, without envisaging that it could be developed. The Green Wedge zone could easily have extended to the extremity of the allotment boundary. If my decision were otherwise, the Residential 3 zone portion would be rendered sterile.

1. Member Komesaroff referred to the provision in planning schemes predating new format planning schemes based on the Victoria Planning Provisions, which addressed the issue of use of land in more than one zone. She suggested that the Minister for Planning may wish to amend the planning schemes to include a translation of this former clause. Alternatively, she suggested that the matter may be left to rest with her decision of Guastella and Miller & Merrigan as authority for the proposition that subdivision of land in two zones was permissible along the zone boundary.

1. It is unsatisfactory and confusing for there to be two lines of conflicting authority on this point. Therefore it is relevant to go back to first principles in determining this question of law rather than simply relying on one or other of the previous decisions.
2. A basic first principle is that a purposive approach should be applied to the interpretation of planning schemes when there is ambiguity or where a literal approach would produce a nonsense outcome or an outcome clearly at odds with the intent of the scheme.[5] It is also appropriate to have regard to the scheme as a whole to identify if there is an ambiguity or what the intent of the scheme may be. However, care must be exercised when departing from the plain meaning of a provision that there is a genuine purpose for doing so, not just a disagreement with the outcome produced by the plain meaning interpretation.
3. The starting point for determining how land in two zones may be subdivided is the planning scheme. Clause 61.05 provides that:

Land may be used or developed only in accordance with this scheme.

1. Turning to the zone provisions as they relate to subdivision, the Green Wedge Zone[6], for example, provides:

Each lot must be at least the area specified for the land in a schedule to this zone. If no area is specified, each lot must be at least 40 hectares.

1. The same words, with varying lot sizes, are used in all other zones where there is a minimum lot size for subdivision.
2. The planning scheme also sets out exceptions when a permit may be granted to create smaller lots. None of these address the specific situation of where the land is in two zones. The exceptions are therefore not relevant to consideration of the question of law in this case.
3. I do not consider there is any ambiguity in the zone provisions relating to subdivision. The plain meaning of the provision is that each lot in the relevant zone must be at least the minimum lot area specified for land in that zone. If the land is in two zones, this would mean that a lot (or lots) created in one zone might legitimately be smaller or larger than in the other zone, provided each lot complied with any subdivision requirements of the zone in which the relevant lot is located. If a new lot straddles the boundaries of two zones (as was the case in Siomos) then the lot must meet the minimum lot size of each zone. In practical terms, this would mean it must meet the larger of the minimum lot sizes.[7]
4. I do not consider the provision means that all lots must be at least the minimum area of the zone having the largest minimum lot size if no part of the lot is within that zone. On the other hand, there is nothing within this provision that leads me to the conclusion it was intended that a smaller lot might be created within a zone if the subdivision was along the zone boundary. It seems to me that if this was intended, it would be in the nature of an exception to the general rule. As such, it should be provided for as an exception either within the exceptions set out in the zone provisions, the particular provisions or in the general provisions of the planning scheme, such as clause 62.04.
5. Clause 62.04 deals with subdivisions not requiring a permit. It sets out situations where any requirement in the scheme relating to the subdivision of land does not apply. It does not include land in two zones or subdivision of land along a zone boundary.[8]
6. There are therefore no exceptions specified either in the zones or general provisions of the planning scheme that address the subdivision of land which is in two zones or provide for the creation of lots smaller than the minimum lot size specified for the zone in such circumstances.
7. Planning schemes which predated VPP schemes often contained a provision addressing use of land where the zone boundary and title boundary did not coincide.[9] However, they contained no specific provision, which I am aware of, that would have permitted land in a zone to be subdivided into lots less than the minimum subdivision area where the land was in two zones, whether along zone boundary lines or otherwise.[10]
8. In the Manual for the Victoria Planning Provisions, which was published by the then Department of Infrastructure as a guide to the preparation of new format planning schemes and the contents and concepts of the Victoria Planning Provisions, it states[11]:

The VPP does not contain special provisions for land in two zones. Zone boundaries should therefore align with title boundaries or other defined features such as road centrelines or watercourses, unless there is a deliberate reason not to.

1. In my view, this statement is clear evidence that the omission of a provision dealing with land in two zones was not accidental. The omission of such a provision is a compelling reason why zone boundaries should align with title boundaries. The unstated inference is that if they do not, then all the provisions of the planning scheme applicable to land which is proposed to be used or developed (including subdivided) must be complied with.
2. The Department may have been optimistic in assuming that all zone boundaries would align with title boundaries or other defined features. Clearly they do not, but no change to the Victoria Planning Provisions has been made to remedy the situation, which would imply that so far as the Government is concerned there is no problem.
3. It is not as though there is no alternative solution to allowing land in two separate zones to be used or developed in accordance with the primary purpose of each zone, if that is the most appropriate planning outcome. The solution lies in an amendment to the planning scheme. The whole of the land could be rezoned or the land could be included in the schedule to clause 52.03 and an incorporated document could authorise the proposed subdivision.[12]
4. I consider that Miller & Merrigan and Guastella offer little in the way of substantive reasons for concluding that a subdivision along a zone boundary is acceptable, apart from the view that the alternative produces a nonsense outcome. In Miller & Merrigan, Justice Morris suggests that it is "incomprehensible" that the authors of the scheme would have imagined that use of the land in the Residential 1 Zone could not be used for residential development. As the only way to achieve this was by way of a subdivision of the land, he held that the words of the planning scheme should give way to what he considered to be the clear purpose of the scheme as evidenced by the planning scheme map.
5. I am not convinced that this was so "incomprehensible" or resulted in such a nonsense outcome that it would justify interpreting the planning scheme in a way contrary to the plain meaning of the words. It might have been an inconvenient outcome in the short term, but it would have been possible to overcome this by amendment of the planning scheme. The outcome may also have been unintended due to the unwise placement of a zone boundary that did not coincide with a title boundary. However, in different circumstances, depending on the zones or the proportions of land in each zone, a perfectly reasonable planning outcome may be produced by an interpretation of the provision to mean that each lot created must comply with the minimum subdivision size of the zone or each zone (where more than one) the lot is within. Equally, an interpretation in accordance with Miller & Merrigan may produce a nonsense outcome or one that is contrary to the intent of the planning scheme if that intent is considered to be only to allow subdivision of land into certain minimum lot sizes.
6. For example, subdivision in the case of Rumpf along the zone boundary would have produced a most undesirable planning outcome. Yet where in the planning scheme can justification be found for allowing subdivision along a zone boundary, which will produce lots less than the minimum subdivision size, in one set of zones but not another?
7. In my view, there is no such justification. The planning scheme is quite clear that where a permit is required for subdivision, each lot must be at least the area specified as the minimum lot size for that zone. A permit may be granted to create smaller lots in specified circumstances, but this does not include the situation where land is in two zones. This is the sort of situation which the specific sites and exclusions provisions of clause 52.03 is designed to deal with.
8. If the Government considers that there should be an exception to the subdivision provisions of planning schemes, which allows smaller lots to be created than the minimum area in the case of land in two zones or subdivision along a zone boundary, then the Victoria Planning Provisions should be amended.

1. To conclude, I find that where land is in two (or more) zones, the correct interpretation of the planning scheme is that if the land is subdivided, each lot in a zone must be at least be minimum lot size specified in the planning scheme for that zone. If a lot straddles the zone boundary, the lot must meet the minimum lot size for each zone.[13]
2. It therefore follows in this particular case that my response to the question of law is that the proposed subdivision along the zone boundaries is not lawful in light of the minimum requirements of 40 hectares in the Farming Zone (Barrabool Land System).

[1] [2003] VCAT 1939

[2] [2007] VCAT 100

[3] [2007] VCAT 276

[4] [2007] VCAT 1823

[5] See Project Blue Sky Inc v ABA (1998) 194 CLR 355; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; Roads Corporation v McCarthy [2004] VSC 369; Vestey v Warrnambool CC [2008] VCAT 963

[7] It would also need to meet any setback or other requirements of each zone. The same would apply with respect to the requirements of any overlay.

[8] The fifth dot point of clause 62.04 deals with a subdivision which realigns the common boundary between two lots if all the land is in one non-urban zone, the resubdivision does not allow the number of dwellings the whole of the land could be used for under the scheme to increase, and certain other conditions apply, including that any lot that is reduced in area meets the minimum lot area specified of the zone. Whilst this provision is not applicable, it evidences an intention that even in these circumstances the minimum lot area specified for a zone should be maintained.

[9] For example, see clause 13 of the regional section of Melbourne Metropolitan Regional Planning Schemes, which read:

(1) Where the boundary of an allotment on a plan of subdivision sealed with the seal of a municipality pursuant to the requirements of Section 569B of the Local Government Act 1958 or any corresponding previous enactment and approved by the Registrar of Titles prior to the 22nd day of May, 1968, does not coincide with the common boundary of any zones (not including land reserved under Part III hereof) as shown on the Planning Scheme Map and the allotment is located in such zones, the responsible authority may grant permission for the whole of the land contained within the allotment to be used for any purpose for which part thereof, may in conformity with Part II of the Ordinance be used.

As Member Komesaroff notes in Guastella v Kingston CC, this wording would be inadequate to cover the present situation as it only relates to use and not development, subdivision being development.

Clause 2(2)(b) of the Melbourne Metropolitan Regional Planning Schemes is another provision dealing with a situation where a zone boundary does not coincide with the title boundary. It provided that if any part of the boundary of any zone lay within 6 metres of any lot on a plan of subdivision, the responsible authority could determine the boundary of the zone to be coincidental with the boundary of the land.

[10] I am referring to general provisions here. It might be possible for there to have been something to the contrary tucked away in the zone specific provisions or in country schemes. For example, Guastella identified one such provision that existed in the Shire of Mornington Planning Scheme 1959 - see Guastela v Kingston CC [2007] VCAT 1923 at [28].

[12] This was the solution suggested in Rumpf v Melton SC.

[13] The same would also apply in respect of other requirements, such as dimensions or setbacks.