1. As to restriction (c), the council made the following submissions:

1. The Tribunal must be satisfied, in terms of the section 60(5) test, that beneficiaries are unlikely to suffer any detriment of any kind, including perceived detriment, from the proposed variation. If the Tribunal is so satisfied, it must then consider, as per clause 52.02 of the Scheme, the interests of affected people.
2. The parties agreed that the restriction was intended to create a particular scale of low density form of residential development in the area with specific building materials, achieving a specific amenity outcome. I agree with the detailed assessment undertaken by the council as to how the specific restrictions achieve the purpose, as follows:

1. The council continued on to suggest that, even though the benefiting land is in the adjoining subdivision, the scale of development present within the benefiting subdivision, together with the restrictions on the burdened land, ensure that development in that area 'remains compatible with, and does not undermine, the established low-scale residential character of the adjoining subdivision'[5] and that the creator of the restrictive covenant was seeking to manage amenity and neighbourhood character outcomes across subdivisional boundaries.
2. The effect, as can be seen today, is a cohesive low scale residential neighbourhood with a high level of amenity.
3. Whilst I appreciate that no beneficiaries have objected to the variation of the restriction in the manner proposed and that the beneficiary properties are not in the immediate vicinity of the burdened land, the Tribunal's role is to be satisfied that beneficiaries are unlikely to suffer any detriment of any kind, including perceived detriment, as a result of the variation.
4. This larger neighbourhood has a very distinct character that is readily observable from the streetscape. The double storey dwellings, and the dwellings constructed from materials other than brick, brick veneer or stone, are the minority in this area and present as outliers rather than part of the established character of the area. They are the clear exception.
5. Beneficiaries of the restriction will have benefited from that character that has been achieved and the amenity that flows from it, and will have a general expectation that this will be maintained. The council referred to the Tribunal decision in Hill v Campaspe SC[6] ('Hill') which included the following comments on amenity:

...Amenity may be an intangible benefit, but it is nevertheless a benefit that is well recognised within the planning lexicon. It is not necessary that the proposed dwelling be visible from each of the lots benefited by the covenant to constitute a detriment to amenity.

It is in the context of assessing detriment to intangible concepts, such as amenity and character, that the notion of perceived detriment becomes highly relevant.

1. The Tribunal in Hill did not accept the argument that because owners of land benefited by the restriction had not objected, the absence of such objections makes it unlikely that such owners would suffer detriment.[7]
2. The applicant submitted that if the Tribunal did not agree that the material should be varied, it would be satisfied with a decision to allow the double storey dwelling variation only.
3. The applicant also referred to the decision of Hanna v Darebin CC [2025] VCAT 1127 ('Hanna'), recently determined by this Tribunal, where a planning permit was granted to vary a restriction and for construction of two dwellings on a lot. The applicant submitted that, in the current application, there is no proposal to change the restriction as it applies to a single dwelling on the lot, but simply to allow for a different form and material, suggesting that the current application possibly represents a lesser, and even more acceptable, proposed variation of a covenant. In Hanna, the applicant sought a variation to the restriction to remove the single dwelling restriction entirely.
4. The test in that matter was also consideration under section 60(5) of the PE Act. The substantive reasons for this decision are reproduced below:[8]

I consider that, as a result of the two dwelling proposal, the owner of any land benefited by the restriction will be unlikely to suffer any detriment of any kind (including any perceived detriment).

However, the proposal as drafted is to vary the covenant to remove the single dwelling restriction in its entirety. The consequence of that variation would be an ability to construct more than two dwellings on the land, subject to Scheme requirements.

I consider that the variation of the restriction in this way may result in detriment or perceived detriment to beneficiaries who are not anticipating built form other than that which has been included in the planning permit application, which is consistent with the existing neighbourhood character and will affect a change that will be largely imperceptible in the streetscape.

Additionally, in considering the interests of affected people, I have considered the planning interests having regard to the planning application before the Tribunal and the relevant provisions of the Scheme. A variation to remove the dwelling restriction entirely, without a related planning permit application may have led to a different conclusion as to the interests of affected people and the planning merits.

As a result, I consider that the covenant should be amended to remove the single dwelling restriction. However, I find that it must be replaced with a restriction on more than two dwellings, thereby achieving the intent of the variation as it is proposed together with the planning permit application, without allowing for unintended consequences that may cause detriment and may affect the interests of affected persons.

1. While it is the case that there are circumstances where the 'high bar' can be met, I do not find that it is met in this circumstance. There is a clear character to the neighbourhood in which the land is located. Section 60(2) of the PE Act, pertaining to restrictions created after 25 June 2991, refers to financial loss, loss of amenity, loss arising from a change to the character of the neighbourhood or any other material detriment in considering whether removal or variation of a restriction should be permitted. Section 60(5) requires a consideration of any detriment of any kind, including that which may be perceived.
2. In Hanna, I found that the specific two dwelling proposal for which a permit was sought was designed in such a manner that it will still be perceived as a single dwelling within the streetscape and that any beneficiaries would be unlikely to suffer any detriment of any kind.

1. The variation of this restriction in this case would allow the new material of 'cladding' to be used on any part of a future dwelling. As submitted by the council, this could encompass 'a wide range of potential materials and visual outcomes, the extent of which cannot presently be assessed'[9]. So too, a variation to allow double storey without clarity as to setbacks, articulation and form of development, could lead to a range of outcomes.
2. Having regard to the neighbourhood that has been developed as a result of this restriction, and other restrictions on neighbouring land, I find that beneficiaries are not unlikely to suffer detriment by way of loss of amenity and loss arising from a change to the character of the neighbourhood, and are not unlikely to suffer perceived detriment from the possibility of a deviation from the purpose of the covenant, loss to the visual cohesion of the area, the amenity enjoyed and the low scale, brick, single dwellings that characterise the area.
3. In circumstances where every variation from the 'single storey brick' is noticeable and exceptional within this larger neighbourhood, this is not a situation where the proposed variation would simply result in a dwelling which would blend into the established character or not be perceived as a change. It is a situation where a construction of the nature proposed would be immediately perceptible as one which is discordant with the established character of the area and likely to be perceived by beneficiaries of the restriction as detrimental. As a result, I am not satisfied that a beneficiary will be unlikely to suffer any detriment of any kind and the Tribunal must not grant a permit for the variation sought.
4. Having made that determination, I do not need to go on to consider the interests of affected persons. However, I do note that an objection to the application was filed with the council by a close neighbour whose land is also burdened by the same or a similar covenant and who raised concern at the potential erosion of the established neighbourhood character.

1. For the reasons given above, the decision of the responsible authority is affirmed. No permit is granted.

[1] The submissions of the parties, any supporting exhibits given at the hearing and the statements of grounds filed have all been considered in the determination of the proceeding. In accordance with the practice of the Tribunal, not all of this material will be cited or referred to in these reasons.

[2] (Includes Summary) (Red Dot) [2014] VCAT 1558 (16 December 2014) at [110].

[3] This plan was included at paragraph 5 of the applicant's written submissions.

[4] At paragraph 17 of the applicant's written submissions.

[5] At paragraph 74.4 of the council's submissions.

[6] [2011] VCAT 949 at [132]- [133].