Owners Corporation No.1 PS540313Q v Eaton (Owners Corporations) [2025] VCAT 674

1. The setting for the dispute in this proceeding is the Wyndham Harbour development in Point Cook which is built around a celebrity golf course and 60 hectare lake. Features of the development include 24/7 security patrols, a recreation club with gymnasium, swimming pool, tennis courts, and 'a resort maintenance team that attends to the presentation of gardens, the lake, and community areas' within the development.[1]
2. The dispute concerns action taken by the respondents, who are lot owners, in 2022, to clear the nature strip on the road reserve outside their lot, which had originally been planted with a variety of native plants, and to install lawn instead.
3. The owners corporation says the respondents' action breach of certain Registered Rules of the owners corporation, and their conduct also amounted to alteration of a service contrary to s 47A of the Owners Corporations Act 2006 ('OC Act'). The owners corporation seeks Orders from the Tribunal that the respondents pay the owners corporation the cost of restoring the nature strip to a garden area planted with native plants.[2] That amount was estimated by the owners corporation in its application as $6,387.29. In its final written submissions dated 21 January 2025, the owners corporation revised the amount claimed to $2,854.63.[3]
4. The owners corporation has not, as yet, incurred any expenses in relation to re-planting of the nature strip, as it has taken no action to reinstate the area.
5. Section 155 of the OC Act permits an owners corporation to issue a breach notice, requiring rectification of an alleged breach of an obligation imposed on a lot owner, an occupier or a manager by the OC Act, the OC Regulations or the rules of the owners corporation.
6. The applicants rely on a breach notice dated 15 September 2022 and a final breach notice dated 18 January 2023. The two notices are in similar terms. They allege that the respondents removed plants and trees in breach of Registered Rules 15.1, 16.3, 16.5(b), 16.6(a) and s 47A of the OC Act. The Registered Rules are referred to as 'Additional Rules' in the breach notices. The allegation in each notice is:

You have interfered with the Owners Corporation discharge of its obligations under the Operation Environmental Management Plan.

You have removed plants on the nature strip which form part of the Common Areas under the Additional Rules

You have removed landscaping on the nature strip which on the Development Land

You have damaged the landscaping on the nature strip which forms a part of the Common Areas.

Breach of s47A - interfered and sought to alter a service of the Owners Corporation - the service being 'the discharge of the Owners Corporation's positive obligations under the OEMP as required by the Planning Permit for Wyndham Harbour'.

immediately cease interfering with the Owners Corporation's performance of its services and discharge of its positive obligations under the Operations Environmental Management Plan.

pay the Owners Corporation the cost of reinstating the nature strip to its prior state and so as to be compliant with the Planning Permit, Endorsed Landscape Plan and OEMP for Wyndham Harbour. Enclosed with this notice is a quote to reinstate the nature strip.

1. The respondents do not dispute that they cleared the plants on the nature strip. They say that did this because there had been no maintenance of the nature strip over a number of years, the area was overgrown with weeds, many plants had died, and the area was an eyesore. The respondents say that the work they did to the nature strip was carried out in accordance with the local council's guidelines to residents as to maintenance, and acceptable treatment of nature strip areas.
2. The respondents dispute that they have acted contrary to either the Registered Rules or s47A of the OC Act. They say the area in question is not shown as 'common land' on the development plan. They say, further, the area of nature strip forms part of the road reserve, and is owned by the local council, that it is not common property and therefore not the responsibility of the owners corporation.
3. The terms used in the breach notices, and in the Registered Rules, derive from defined terms used in the planning documents relating to the subdivision. Before turning to the issues in dispute, it will be helpful to set out details of the subdivision arrangements, and the obligations the owners corporation relies upon.

1. The owners corporation says that it is responsible for the maintenance of all landscaping within the subdivision, as a consequence of express conditions placed on the planning permit for the development. The planning permit was issued on or around 1 October 2008. Although the owners corporation was not in existence at the time the planning permit conditions were articulated,[4] the owners corporation says that the planning permit conditions contemplated that the owners corporation would have ongoing responsibility for many of the conditions in the planning permit. Further, it says obligations relating to landscaping were imposed directly on the owners corporation by the operation of the terms of an Agreement made under section 173 of the Planning and Environment Act 1987 (Vic) ('P&E Act') in accordance with the planning permit conditions, to which the developer, the owners corporation and the Council were all parties.

1. Many of the conditions in the planning permit reflect the fact that the development is on coastal land and required both an Environment Effects Assessment under the Environmental Effects Act 1978 (Vic) and an assessment under the Environment Protection and Biodiversity Conservation Act 1999 (Cth) ('EPBC Act').
2. Condition 15 of the planning permit required the owner or developer to clear the reserves and common property of all rubbish, noxious weeds, debris and spoil, and for those areas to be levelled, graded and landscaped to the satisfaction of the Council, and provided: 'The developer must maintain these reserves and the Common Property as required under the OEMP Activation s 173 Agreement'.
3. Condition 16 required the developer to plant 'two (2) tree seedlings minimum of 1.5 metres high per 15 metres of road within the subdivision' and to 'maintain these street trees for a minimum of 24 months from the agreed date of establishment'.
4. Other conditions attached to the permit included requirements:
   1. for the provision of water, electricity, sewerage, roads, drainage and fencing;
   2. that the owner or developer must plant street trees and maintain them for a minimum of 24 months;
   3. giving details required for coastal works and marine infrastructure;
   4. to protect native vegetation;
   5. for detailed landscape plans to be submitted and approved prior to the issue of a statement of compliance for each staged plan of subdivision for residential subdivision;
   6. for parking management plans;
   7. that the development comply with the requirements of approval issued under the EPBC Act;
   8. conditions relating to removal of native vegetation;
   9. detailed layout of the wetlands including water depths, islands, habitat areas and proposed surface levels; and
   10. as to compliance with the requirements of utility providers, water authorities and environmental regulators.
5. The reference to "OEMP" in condition 15 is related to condition 44 of the planning permit conditions, which directed that an Environmental Management Plan - Operations ('OEMP') be prepared. I give further detail about the OEMP later in these reasons. Clause 44 stated that the OEMP was intended to 'be endorsed and form part of this permit'. The OEMP was to 'address day to day operation requirements of the various elements of the project including those requirements specifically listed in the Development Plan Overlay - Schedule 9', and:
   1. water quality monitoring for waters within and adjacent to the marina and elsewhere;
   2. environmental management and public area maintenance obligations;
   3. 'a requirement that the owners corporation/marina operator is responsible for maintenance dredging and monitoring within the harbour'; and
   4. a requirement that the OEMP 'must be complied with at all times and implemented to the satisfaction of the Responsible Authority'.[5]
6. Other conditions of the planning permit also referred to the owners corporation:
   1. Condition 45: 'Within 45 days of the date of issue of the Statement of Compliance for any part of Stage 1 works in the development, Wyndham Harbour Pty Ltd and Wyndham Harbour Owners Corporation 1 Plan No 540313Q must ... enter into an agreement [under section 173 of the P&E Act]... [to be known as the OEMP Activation Agreement] with the Responsible Authority pursuant to section 173 [of the P&E Act] that provides for maintenance and management obligations land and water based developments free hold and leasehold land, bio retention systems and open space ...'. [6]
   2. Condition 47: the OEMP 'must state to the satisfaction of the Responsible Authority that the Wyndham Harbour Owners Corporation will be responsible for the ongoing maintenance of bioretention systems throughout the Harbour Estate', and for 'ongoing maintenance dredging'.[7]

1. Both the planning permit, the OEMP and the section 173 Agreement refer to a Development Plan 'prepared in accordance with the Development Plan Overlay contained in Development Plan Overlay 9 - in Schedule 9 - Wyndham Harbour to clause 45.06 of the Wyndham Planning Scheme'.
2. In general, a Development Plan is not incorporated into the Planning Scheme. It is a guide for development, in the sense that development proposals in an area affected by a Development Plan must be generally in accordance with the Development Plan; also, advertising and objection requirements are less onerous where there is a Development Plan.
3. The Development Plan Version 7 December 2014 states in clause 15.3, headed 'Owners Corporation Areas and Responsibilities':

It is proposed that an Owners Corporation will be established to be responsible for the management and maintenance of designated areas...[including]...the foreshore reserve ...; all common property on the freehold land including wetlands and landscaped areas; all landscaping within road reserves; and all landscaping and parking within the Channel Reserve.' It goes on to say annual fee, and that OC responsible for 'monitoring of the landscaping, all public areas, infrastructure etc and these to be outlined in the OEMP.

Section 32.2 - refers to environmental performance of Wyndham Harbour (and set out relevant legislation) auditing and reporting activities.

1. Neither party provided evidence or submissions on the effect of this proposal. In my opinion, the effect is unclear. An owners corporation is created on registration of the plan of subdivision. That owners corporation is responsible for common property only. The owners corporation has not placed any evidence before me, nor made any submission as to whether there is any power conferred on a responsible authority to create an additional owners corporation, or to empower an owners corporation to raise fees for purposes other than the administration and maintenance of the common property.

The Environment Management Plan - Operations (OEMP)

intended to control the ongoing management of the Wyndham Harbour development to comply with all operational and environmental obligations specified in [the related planning documents and relevant environmental management legislation] and as a reference tool for the Owners Corporation and the Marina Operator.[8]

1. In Part 4.1 of the OEMP, under the heading 'Management Structure' it states:

The Management Team for Wyndham Harbour is a multi-layered structure and comprises both the Owners Corporation and marina management.

1. The 'main purpose' of the owners corporation is described as 'to oversee the management of the Owners Corporation areas of responsibility'.[9] In Part 4.4 of the OEMP, under the heading 'General Areas of Responsibility', a table appears which records, in relation to road reserves, that the Council owns the road reserves, but that the owners corporation is responsible for 'landscaping to verges and directional signage'.[10]
2. In Part 5 of the OEMP, dealing with 'environmental management targets', is a Table that appears to record that the owners corporation will be responsible for management of solid and liquid waste impacts as well as compliance with State Environment Protection Policies relating to noise, and ensuring shops and restaurants in the development maintain their businesses in an ecologically sustainable manner.[11]
3. The OEMP also purports to allocate a number of additional functions to the owners corporation such as 'inspection and maintenance of landscaping' and 'monitoring' of 'unrestrained' domestic cats and dogs.

1. The planning permit required the developer and the owners corporation to enter into an agreement under section 173 of the P&E Act.
2. Section 173 of the P&E Act empowers a responsible authority, with responsibility for granting planning permits under the P&E Act, generally the municipal council, to enter into an agreement with an owner of land in the area covered by a planning scheme for which it is a responsible authority. Agreements made in accordance with that power, are styled 's173 Agreement'.
3. Section 174 of the P&E Act specifies the form and content of a section 173 Agreement. It must be under seal and must bind the owner to the covenants specified in the agreement. The agreement may provide for any one or more of the following matters:

(a) the prohibition, restriction or regulation of the use or development of the land;

(b) the conditions subject to which the land may be used or developed for specified purposes;

(c) any matter intended to achieve or advance -

(i) the objectives of planning in Victoria; or

(ii) the objectives of the planning scheme or any amendment to the planning scheme of which notice has been given under section 19;

(d) any matter incidental to any one or more of the above matters.

1. Section 62(2)(f) of the P&E Act permits a condition to be imposed on a planning permit to require the owner of the land or the applicant for the permit in anticipation of the applicant becoming the owner of the land, to enter into an Agreement with the responsible authority under section 173 of the P&E Act.
2. Section 62(5) of the P&E Act authorises the responsible authority to 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, to be provided by the applicant, or paid for wholly by the applicant or 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.
3. Section 62(6) of the P&E Act provides that a responsible authority must not include a condition requiring a person to pay an amount for or provide works, services or facilities except in accordance with subsection 62(5) or in accordance with provisions relating to Development Infrastructure Levies or Infrastructure Contributions under the P&E Act.
4. It appears from these provisions that a responsible authority does not have power to include in a permit a condition requiring a person other than the applicant for the permit to provide or meet the cost of works, services or facilities.

1. The parties to the section 173 agreement relied upon by the owners corporation were, as contemplated by the conditions on the planning permit, the developer (Wyndham Harbour Pty Ltd) the applicant (Owners Corporation 1 Plan No 540313Q) and the responsible authority (Wyndham City Council).
2. The minutes of the inaugural General Meeting of the owners corporation, conducted on 28 September 2012, record that the owners corporation resolved, by special resolution, to enter into 'the s 173 OEMP Activation Agreement'.
3. The section 173 agreement is styled 'OEMP Activation Wyndham Harbour'. The section 173 agreement is dated 24 April 2015. It appears that the director of the developer executed the Agreement on behalf of the developer and, in his capacity as representative of lot owners, affixed the owners corporation seal to the Agreement on or around 23 September 2014. The council executed the Agreement on 24 April 2015.
4. Recital D to the Agreement records that:

The Development Plan Overlay, Development Plan and Planning Permit require an OEMP to deliver environmental control measures which will minimise the impact of daily operations of the residential properties at Wyndham Harbour, and the marina, on the surrounding environment.

1. Recital G to the section 173 agreement records that the planning permit requires that the developer and the first respondent must enter into an agreement under section 173 of the P&E Act with Wyndham City Council 'for, amongst other things, the activation of the OEMP '.
2. Recital J of the section 173 agreement records that 'The parties enter into this agreement to':
   1. give effect to the OEMP requirements in the Development Plan Overlay, Development Plan and the planning permit;
   2. assign ongoing responsibility for each obligation in the OEMP to a party;
   3. give effect to the provision of clause 5.5 of 7 July 2011 173 Agreement (sic) and section 15 of the Development Plan; and
   4. achieve and advance the objectives of planning in Victoria and the objectives of the Planning Scheme in respect of the WHPL Land.[12]
3. Clause 2.1.4 of the section 173 agreement provides 'OC1 acknowledges and agrees that to the extent that there is any inconsistency between the OEMP Land Obligations and the OC1 Rules from time to time, the OEMP Land Obligations prevail'.
4. Clause 5.2 of the section 173 agreement records an agreement by the owners corporation to raise fees to meet the costs of its "obligations" under the OEMP:

OC1 agrees that it will set annual fees to be paid by each lot owner or occupier and that upon collection of the fees, the money will be applied to its obligations under the OEMP, specifically to meet the costs of maintaining all areas under OC1's management including the foreshore areas and the bio retention swales.[13]

1. Schedule 4 to the section 173 agreement purports to allocate responsibility to OC1 for landscaping to verges and directional signage on road reserves.

1. As I have noted above, it is the owners corporation's contention that the conditions of the planning permit, and the terms of the OEMP have the effect of:
   1. imposing 'the function and recurring obligation to' maintain landscaping within road reserves within the subdivision, thereby requiring it 'to provide the service of maintaining all land based public areas, including all landscaping within road reserves';[14] and
   2. 'imposed on the OC the function duty responsibility and obligation to enter into the section 173 OEMP Activation Agreement and provide the services required' by the OEMP.[15]
2. The owners corporation submits further that the terms of the planning permit 'disclosed an intention and requirement of the Council in approving the Development Plan that the OC was to raise fees from its members to meet the cost of providing the services required by the OEMP'.[16]
3. In its written submissions, the owners corporation contended that:
   1. the nature strips on the Plan are land affected by the owners corporation;
   2. maintenance of the nature strips 'is for the benefit of all lots and common properties on the Plan in maintaining the beauty and aesthetic of Wyndham Harbour', and
   3. the maintenance is 'inherent to the enjoyment of each lot and common properties on the Plan'.[17]
4. The respondents say that the nature strips are Council land, and not the responsibility of the owners corporation.
5. In my opinion, it is apparent that the nature strips are not part of the land affected by the owners corporation. The phrase 'land affected by the owners corporation' is defined identically in both the Subdivision Act 1988 (Vic) ('Subdivision Act') and the OC Act. The definition is:

land affected by an owners corporation means the lots the owners for the time being of which are the member of the owners corporation, together with the common property for which the owners corporation is responsible.

1. Section 24(2)(b) of the Subdivision Act, which specifies the consequences of registration of the plan of subdivision, provides

(2) Upon registration -

...

(b) land set aside as a road vests in the Council or any other person or body identified for that purpose in the plan [freed and discharged from any mortgage, charge, notice or memorandum of charge, restriction, lease or sub-lease]; and

(ba) any agreement under section 173 of the Planning and Environment Act 1987 applying to land vested in a Council or a collecting agency under paragraph (a), (ab) or (b) ceases to apply to that land; and

(c) any road vested in the Council becomes a public highway.[18]

1. The plan of subdivision shows that the nature strips are located within the road reservation. The road reservation is vested in the Council on registration of the plan of subdivision. The nature strips are neither lots, nor common property. The nature strips therefore are not 'land affected by an owners corporation'.
2. In the alternative, the owners corporation submitted that the 'service' provided by that maintenance is a service within the meaning of s 4(b)(iii) of the OC Act which is 'otherwise for the benefit of the land affected by [the] owners corporation'.[19]
3. Although the breach notices allege that the respondents have interfered with the owners corporation's discharge of its obligations under the OEMP, removed plants from Common Areas and removed landscaping from the Development Land, in my view, that language is simply a precis of the terms of the Registered Rules 15.1, 16.3, 16.5(b) and 16.6(a).
4. The owners corporation says that the Registered Rules give effect to the functions the owners corporation says are imposed on it by the planning permit, the OEMP and the section 173 Agreement.
5. Before considering whether the respondents are in breach of the Rules, and s47 of the OC Act, it is necessary to consider whether the Registered Rules relied upon are a valid exercise of the power to make owners corporations rules.
6. Accordingly, the issues to be determined in this proceeding are:
   1. Are the Rules relied upon in the breach notices valid?
   2. Has there been a contravention by the respondents of the Registered Rules relied upon?
   3. Has there been a contravention by the respondents of s 47A of the OC Act?
   4. Have the planning controls imposed additional functions on the owners corporation?

Do the Registered Rules represent a valid exercise of the owners corporation's power to make Rules under the OC Act?

1. The 2016 decision of his Honour Riordan J in Owners Corporation PS501391P v Balcombe is authority for the proposition that rules made by an owners corporation under s 138 of the OC Act will be a valid exercise of the power conferred by that section if the Rules have a sufficient connection with one or more of the matters set out in Schedule 1 to the OC Act.[20]
2. His Honour set out three issues to be considered in determining whether owners corporation rules have a sufficient connection with a matter set out in Schedule 1 to the OC Act:[21]
   1. What was the relevant statutory purpose of the legislation conferring the power to make the rules?
   2. What is the character of the impugned rule?
   3. Is there a sufficiently direct and substantial connection between the statutory purpose and the likely operation of the impugned rule?
3. Those steps follow the well-established approach in the courts to determining the validity of subordinate instruments. Owners Corporations rules are subordinate instruments within the meaning of s 38(b) of the Interpretation of Legislation Act 1984 (Vic) ('IL Act'):

subordinate instrument means an instrument made under an Act -

(a) that is a statutory rule[22]; or

(b) that is not a statutory rule but -

(i) contains regulations, rules, by-laws, proclamations, Orders in Council, orders or schemes; or

(ii) is of a legislative character;

1. Owners corporation rules are made under the OC Act, they contain rules, and are in the form of an instrument because they are required, by s 142 of the OC Act, to be the form required to be recorded in the Register kept under the Transfer of Land Act 1958 (Vic).
2. The Supreme Court in Owners Corporation RP3454 v Ainley ('Ainley')[23] expanded on the analysis in Balcombe. The rule must:
   1. be made by special resolution (to which I would respectfully add, or have been registered with the plan of subdivision as provided for in s 27E of the Subdivision Act);
   2. have a sufficient connection with a matter set out in Schedule 1 to the Act, that is, the rule must be 'for' or 'with respect to' such a matter; and
   3. be for the purpose of the control, management, administration, use or enjoyment of the common property or of a lot.
3. A further consideration is whether the rule complies with any other procedural requirements relating to the making of the rule.
4. The starting point is the legislative provision conferring power to make the rules under s 138 of the OC Act:

138 Power to make rules

(1) By special resolution, an owners corporation may make rules for or with respect to any matter set out in Schedule 1.

(2) By special resolution, an owners corporation may amend or revoke any rules made under subsection (1).

(3) A rule must be for the purpose of the control, management, administration, use or enjoyment of the common property or of a lot.

1. Section 138(1) of the OC Act authorises the making of rules for or with respect to any matter set out in Schedule 1 to the OC Act. Section 138(3) of the OC Act provides that an owners corporation rule must be for the purpose of the control, management, administration, use or enjoyment of the common property or a lot.
2. Section 140 of the OC Act provides:

140 Rules to be of no effect if inconsistent with law

A rule of an owners corporation is of no effect if it -

(a) is oppressive to, unfairly prejudicial to or unfairly discriminates against, a lot owner, or an occupier of a lot; or

(b) is inconsistent with or limits a right or avoids an obligation under -

(i) this Act; or

(ii) the Subdivision Act 1988; or

(iii) the regulations under this Act; or

(iv) the regulations under the Subdivision Act 1988; or

(v) any other Act or regulation.

1. To the extent that owners corporations rules are directed to matters that are not connected with the control, management, administration, use or enjoyment of common property or a lot, such rules will be beyond the power conferred by s 138 of the OC Act, and in consequence, unenforceable.[24]

1. The Rules registered with the Plan of Subdivision are styled 'Wyndham Harbour Draft Owners Corporation Rules'. As they were lodged with the plan of subdivision, although they are styled 'draft', they are to be taken to be the rules of the owners corporation, as though they had been made by special resolution in accordance with s 138 of the OC Act.[25] I refer to these rules as the 'Registered Rules'.[26]
2. The breach notices relied upon by the owners corporation allege breach of Registered Rules 15.1, 16.3, 16,5(b) and 16.6(a). Those Registered Rules provides as follows:

15.1 - An Owner must not and must ensure that the Occupier of an Owner's Lot does not, carry out or permit any action that contravenes or will lead to the contravention of any requirement of the OEMP.

...

16.3 - A person must not damage a lawn or remove a plant on Common Areas.

...

16.5(b) - A person must not remove any landscaping on the Development or the Estate.

...

16.6(a) - A person must not damage any of the landscape situated upon the Common Areas.

1. The rules referred to in the breach notices issued by the owners corporation rely on the defined terms 'OEMP', 'Common Areas', 'Development' and 'Estate'.
2. Before turning to the definitions given in the Registered Rules, I set out the interpretive provisions of the Rules, set out in a list of Definitions and in Rule 1.2(a).[27]
3. Rule 1.2 (a) provides

These Owners Corporations Rules are to be interpreted having regard to the following objectives of the Original Owner:

(i) Ensuring compliance with any obligations of the Owners Corporate in the Section 173 Agreements;

(ii) The OEMP Activation Agreement;

(iii) Enhancing the amenity of every Lot;

(iv) Maintaining and enhancing any landscaping for which the Owners Corporation is responsible and any other relevant landscaping requirements;

(v) ensuring compliance with Local Laws.

1. The following defined terms are also relevant to the owners corporation's claims:

Common Areas means the Common Property No 1 on the Plan, the public areas that the Owners Corporation is required to maintain under the OEMP Activation Agreement and any area leased or licensed to the Owners Corporation;

Council means the Wyndham City Council and includes (where applicable) any successor local government body whose municipality may at any time include the Development Land or the Estate.

Development Land means the whole of the land in the Plan as amended from time to time;

Estate means the Original Owner's development known as Wyndham Harbour" and includes the Development Land and any other land including any land leased or licensed areas (sic) and water purchased (sic) or otherwise obtained by the Original Owner for which the Original Owner or an Owners Corporation will become responsible.

Local Laws means all local laws made from time to time by the Council.

OEMP means the Wyndham Harbour Operational Environment Management Plan as varied from time to time.

OEMP Activation Agreement means the document between the Original Owner, the Council and the Owners Corporation under s 173 of the Planning and Environment Act 1987 (Vic).

Original Owner means Wyndham Harbour Pty Ltd and its successors, assigns, mortgagee or charge.

Owners Corporation means Owners Corporation No 1 on PS540313Q.

Plan means Plan of Subdivision PS540313Q.

Section 173 Agreements is defined by reference to three agreements dated 7 July 2011, 8 December 2010 and 29 November 2010 made under s 173 of the Planning and Environment Act 1987 to which the Owners Corporation was not a party, and any future Agreement under that provision that the "Vendor" may be required to enter into with any responsible authority in relation to the Plan.

Owners Corporation's submissions on the Registered Rules

1. As I have recorded above, it is the owners corporation's submission that the Registered Rules are necessary to enable it to carry out functions imposed on it by the responsible planning authority at the time that planning permission for the subdivision was given.
2. The owners corporation submits that, specific to this proceeding, one of these functions, maintenance of native plantings on the nature strips, is a 'service' which the owners corporation provides to all lot owners in the subdivision.
3. The owners corporation also relies on two of the specific heads of power set out in Schedule 1 as authorising the Registered Rules it relies upon. These are:
   1. Rule 3.1: Management and administration of common property and services; and
   2. Rule 3.3: Repair of common property and services.
4. The owners corporation submits that the Registered Rules 15.1, 16.3, 16.5(b) and 16.6(a), relied upon in the breach notices:
   1. are relevant and connected with the owners corporation's provision of the service to repair and maintain the nature strips;
   2. enable the owners corporation to provide the service to repair and maintain the nature strips without interference from lot owners or occupiers of lots;[28] and
   3. relate to the use and enjoyment of common property and the lots on the Plan.[29]

1. The respondents submit that they understood the Registered Rules to be draft rules only, because they were designated as 'draft'.[30] I note that the respondents are not legally represented and were not aware of the effect of s27E(2) of the Subdivision Act.
2. The respondents submit that the Registered Rules can have no application to conduct on the nature strip, on the grounds that the road reserve has vested in the Council and does not form part of the subdivision. The respondents note that the owners corporation does not dispute that the nature strips are Council land.[31]
3. The respondents submit that, with the exception of the refence to 'Common Property No 1' in the definition of 'Common Areas', the remainder of that definition does not identify the locations of the areas. They note that Common Property No 1 is readily identifiable from the plan of subdivision, and that there is no common property near lot 102. They say there is no plan or other means to denote the other 'Common Areas'.
4. The respondents assert that the owners corporation has itself behaved as though the Registered Rules were not applicable. The respondents say the owners corporation has not prepared a Maintenance Plan for the 'Common Areas' as required by Registered Rule 6.1. The respondents assert, from their experience as former members of the Committee of the owners corporation, that the owners corporation is unsure whether the Registered Rules are enforceable, and uncertain whether it is really responsible for maintenance of the nature strips. The respondents say this is the reason that no Maintenance Plan has been prepared.
5. The respondents say that other lot owners have done as they did and sown the nature strip outside their lot with lawn, but that no other lot owner has been served with a breach notice. The respondents assert that this proceeding is brought by the owners corporation not for valid reasons, but as a 'test case'.
6. The respondents say also that the owners corporation made no attempt, in relation to the subject matter of this dispute, to follow Registered Rule 36 which sets out the 'Complaints and Disputes' procedure of the owners corporation. The respondents say the owners corporation was required to follow that procedure before commencing this proceeding. I note that the breach notices issued by the owners corporation appear to have been issued in accordance with the requirements of the dispute resolution procedure set out in Part 10 of the OC Act. In my view, s140 of the OC Act requires that the provisions of Part 10 of the OC Act take precedence over the provisions of the Registered Rules relating to dispute procedure.
7. Finally, the respondents say that they have complied with Registered Rule 17.1, paragraphs (c) and (e). Registered Rule 17 provides:

17.1 Maintenance

Every Owner must

(a) Comply with the Residential Design Guidelines;

(b) Maintain in good condition and repair the exterior of the Dwelling and/or Building including (without limitation) all fences, walls, windows, gates, sidewalls (sic) walkways and driveways within a Lot;

(c) Maintain in good condition and repair all yard landscaping (including the mowing of nature strips outside the Lot), irrigation facilities, drainage facilities, swimming poos, spas, fountains, and other surrounds within the Lot;

(d) Make any necessary arrangements for supply of sufficient water for the maintenance and irrigation of all yard landscaping and pay for such water; and

(e) Take all practicable steps to prevent infestation of the Lot by vermin or insects.

1. Implicit in that submission by the respondents is an assertion that Registered Rule 17.1(c), in its requirement that lot owners mow nature strips outside the lot, is inconsistent with the owners corporation's interpretation of the scope of Registered Rules 15 and 16.
2. The respondents say that it was necessary to clear the nature strip in order to protect their lot from infestation by vermin and insects which they say were drawn to the nature strip by its 'disgraceful state' prior to their action.[32]
3. In support of his submission that the respondents had complied with Rule 17.1, Mr Eaton gave evidence in the hearing of the steps he took before clearing the nature strip.
4. Mr Eaton's evidence was that the nature strip had not been maintained by the owners corporation in all the time that he and his wife have resided in their lot, and that, at the time that he cleared the area, in 2022, it was infested with weeds, debris and animal faeces. He referred to an email he sent to the owners corporation manager on 19 November 2021, to ask what could be done about the state of the nature strip. He received a response from the manger stating that they were unsure about ownership and responsibility and believed that the council and the developer were jointly responsible.[33]
5. Mr Eaton said he followed up with the owners corporation manager again on 25 July 2022, 31 July 2022, 24 August 2022 and on 15 September 2022.[34]
6. On 1 August 2022 the respondents sent further emails and received a response from 'Amber' acknowledging that the respondents did not need Council approval to make alterations, and that the committee acknowledged that other lot owners had taken similar action.[35]
7. Mr Eaton referred to photographs taken after the nature strip was cleared and planted with lawn, in which infrastructure service pits for storm water, telecommunications and electricity which can be clearly seen. He contrasted these with photographs taken prior to the work being carried which show that the pit areas were obstructed and overgrown by weeds and unkempt plants.

1. The owners corporation's submission that the Registered Rules are necessary to enable it to carry out functions imposed on it by the responsible planning authority appears to conflate the functions of an owners corporation with the power to make rules.
2. The power to make rules set out in s 138 of the OC Act is not expressed as a power to make rules related to the functions of the owners corporation. Instead, the legislation specifies, in Schedule 1 of the OC Act, 32 topics under 10 headings of matters about which owners corporations rules may be made.
3. In my view, neither s138 of the OC Act, nor Schedule 1 of the OC Act contemplate that an owners corporation may make rules in respect of all of its functions. In my view, this is evident from the terms of the OC Act itself.
4. For example, it is a function of an owners corporation to repair and maintain equipment and services for which an easement or right exists for the benefit of land affected by the owners corporation, but there is no power to make rules in relation to equipment or services made available to lot owners through an easement or other right. That is appropriate. Regulation of such equipment or services would be achieved through the terms of the easement or the document conferring the right.
5. In contrast, there is a power, in item 4 of Schedule 1 of the OC Act, under the rubric 'Use of common property', to make rules in relation to 'use of and access to equipment, services and amenities on common property' and in relation to 'damage to common property'.
6. It is a function of an owners corporation to take out insurance, but there is no power to make rules in relation to insurance or insurance claims. That is equally appropriate, as the terms of the insurance policy will govern such matters.
7. There is no power to make rules in relation to functions conferred by the Subdivision Act, such as making applications to the Registrar under ss 32 and 34 of that Act. Again, that is appropriate, because the Registrar's requirements govern that function.
8. Similarly, in my view, there is no express power to make rules in relation to functions conferred 'by any other law' pursuant to s4(f)(iii) of the OC Act. Again, I consider that to be appropriate. If a rule making power were thought to be required by a law conferring additional functions on an owners corporation, provision should be made for that in the law.
9. In my view, the power conferred on owners corporations by s 138 of the OC Act, to make rules which regulate the conduct and rights of owners and occupiers of lots affected by the owners corporation, has been intentionally limited to specified topics.
10. For these reasons, I do not accept the owners corporation's submission that the Registered Rules are 'authorised' by virtue of being associated with functions the owners corporation says it has acquired by reason of the planning controls.
11. I consider that Rule 1.2 itself presents a further ground for finding that the Registered Rules are not a valid exercise of the power to make owners corporations rules. Rule 1.2 is explicit that the objectives of the Registered Rules include compliance with the section 173 Agreement, the OEMP and Council local laws. I have noted above that the owners corporation says that maintenance of the native planting in the nature strips benefits the enjoyment of the lots and the common property, and therefore the Registered Rules relied upon are 'for the purpose of' enjoyment of the lots and common property. The respondent says that there is no common property near the nature strip area.
12. In my view, Rule 1.2 is inconsistent with s138(3) of the OC Act. Arguably, the instruction that the Registered Rules must be interpreted having regard to the objective of the developer necessarily indicates that the statutory purpose required by the OC Act is not the primary object of the rules. If that is the case, none of the Registered Rules are a real exercise of the rule making power, and following the reasoning in Balcombe, all are invalid. However, if I am wrong in that assessment, it is appropriate to examine each Rule relied upon by the owners corporation, to determine whether it may be a valid exercise of the rule making power.
13. I turn now to each of the Registered Rules relied upon by the owners corporation.

1. For convenience I repeat the text of Rule 15.1 here:

15.1 - An Owner must not and must ensure that the Occupier of an Owner's Lot does not, carry out or permit any action that contravenes or will lead to the contravention of any requirement of the OEMP.

1. Rule 15.1 is concerned with preventing contravention of the OEMP. It is not concerned at all with common property, and, on its face, is not directly concerned with enjoyment of common property and lots, nor with management and administration or repair and maintenance of services.
2. The OEMP is one of the conditions of the planning permit. To the extent that it may be 'contravened', the effect of that conduct would be contravention of the conditions of the planning permit. The means adopted by the Council, as planning authority, to ensure compliance with the OEMP was the requirement that the developer, the owners corporation and the Council all be parties to the section 173 Agreement. In those circumstances I do not consider that the conduct of a lot owner could be said to 'contravene' the OEMP.
3. On one view, the OEMP may be said merely to set out the matters that had to be incorporated into the OEMP Activation section 173 Agreement. However, the drafting of Rule 15.1 does not refer to the section 173 Agreement, nor does it refer to interference with particular services being delivered by the owners corporation, nor is it limited to the obligations of the owners corporation under the OEMP.
4. The scope of the OEMP includes many issues that are not clearly defined. For example, in relation to the Channel Reserve, the owners corporation, as lessee is said to be responsible for 'overflow car parking' and 'Entry statement'. The reference in the OEMP to road reserves simply records a 'General Area of Responsibility' allocated to the owners corporation of 'Landscaping to verges' and 'Directional signage'.
5. In my view, Rule 15.1 is primarily directed to compliance with the OEMP, which is a matter for enforcement by the Council, and is for this reason not a valid exercise of the rule making power conferred by s 138 of the OC Act.
6. To the extent that the owners corporation asserts that the activity of maintaining nature strips which the section 173 Agreement purports to impose on the owners corporation, is a 'service' within the meaning of items 3.1 and 3.3 of Schedule 1, I reject that submission. In my view the absence of any reference to services in the text of Rule 15.1 prevents any such connection being drawn.
7. I find that Rule 15.1 is not a valid exercise of the rule making power conferred on an owners corporation by the OC Act. I find that the owners corporation cannot rely on this Rule.

1. For convenience I repeat the text of Rule 16.3 here:

16.3 - A person must not damage a lawn or remove a plant on Common Areas.

1. It is not alleged that the respondents damaged a lawn, only that they removed plants.
2. As I have noted above, the term 'Common Area' is defined in the Registered Rules as comprising:

Common Property No 1 on the Plan, the public areas that the Owners Corporation is required to maintain under the OEMP Activation Agreement and any area leased or licensed to the Owners Corporation'.

1. The respondents say that it is not clear from the Registered Rules what areas are 'Common Areas'. I agree, and I consider that lack of clarity to be fatal.
2. There is no definition of the phrase 'public areas that the Owners Corporation is required to maintain under the OEMP Activation Agreement' nor is there any certainty as to the areas 'leased or licensed to the Owners Corporation'. I note from the documents on the Tribunal's file that there is a definition of 'public areas' in the section 173 Agreement. The definition is 'the Public Areas (as defined in that 7 July 2011 agreement)'. The definition of 'Common Area' thus seeks to incorporate by reference the OEMP Activation Agreement and another prior section 173 Agreement. The reference to areas leased or licensed to the owners corporation necessarily implies incorporation by reference of the relevant terms of leases and licences granted to the owners corporation.
3. As I have noted above, owners corporation rules are subordinate legislation within the meaning of the IL Act.[36] Subordinate legislation may only apply, adopt or incorporate any matter contained in a document if there is express power given to do so.[37] No such power is given in the OC Act. In my view, that omission is with good reason, as the procedural steps set out in the IL Act which are required to achieve incorporation of another document by reference into subordinate legislation would be prohibitively burdensome on an owners corporation.
4. As a consequence of there being no power to incorporate either the OEMP or the section 173 OEMP Activation Agreement into the Rule, the inclusion of matters other than common property into definition of "Common Area" is beyond power. I find that Rule 16.3 is therefore limited to common property. The respondents' actions were to a road reserve which does not form part of common property. I find that there was no breach of Rule 16.3 by the respondents.

Rule 16.5(b) - A person must not remove any landscaping on the Development or the Estate.

16.5 Prohibition against destruction

A person must not:

wilfully injure, ring-bark, cut down, top, lop, remove or destroy any trees, plants or other growing things or landscaping (collectively 'Landscape') on the Development Land or the Estate (whether or not identified in the register).

1. The term 'Development Land' is defined in the Registered Rules as 'the whole of the land in the Plan as amended from time to time'. 'Plan' is defined as 'Plan of Subdivision No PS540313Q'. The defined term 'Development Land' is therefore not limited to common property, and would include land within the lots.
2. However, in my view, the operation of section 24(2)(b) of the Subdivision Act, necessarily has the effect that the defined term 'Development Land' cannot mean land within the road reservations. This is because, on registration of the Plan, the road reservations are vested in Wyndham Council. The land falling within the road reservations therefore does not form part of the 'land in the Plan'.
3. The term 'Estate' is defined in the Registered Rules as:

means the Original Owner's development known as "Wyndham Harbour" and includes the Development Land and any other land leased or licensed areas and water purchased or otherwise obtained by the Original Owner for which the Original Owner or an Owners Corporation is or will become responsible.

1. As definition of 'Estate' relies on the defined term 'Development Land', it also does not extend to the road reservations.
2. To the extent that Registered Rule 15.5(b) is concerned with the regulating actions of 'persons' for purposes associated with the OEMP, I find that the rule is not limited to a purpose necessary for control, management, administration, use or enjoyment of the common property or a lot. Accordingly, as it is not limited to that purpose, I find that it is not a valid exercise of the owners corporation's power to make rules.
3. Further, if I were wrong in that finding, for reasons similar to the analysis of Rule 16.3, Rule 16.5(b) is limited to conduct that occurs on common property. As the respondents' conduct in removing plants from the nature strip, and planting out the nature strip with lawn, did not occur on common property, the respondents' conduct does not amount to a breach of Rule 16.5 (b).

1. For convenience I repeat the text of Rule 16.6(a) here:

Rule 16.6(a) - A person must not damage any of the landscape situated upon the Common Areas.

1. As this rule relies on the defined term 'Common Areas', the rule is limited to common property, for the reasons set out above in relation to Rule 16.3. Accordingly, I find that the respondents' conduct in removing plants from the nature strip, and planting out the nature strip with lawn, does not amount to a breach of Rule 16.6(a).

Have the respondents contravened s 47A(2)(b) of the OC Act?

1. The breach notices also allege breach of s 47A(2)(b) of the OC Act:

S 47A Lot owners must not repair , alter or maintain common property or services

(2) A lot owner must not repair, alter or maintain

(a) the common property of the owners corporation; or

(b) a service in or relating to a lot that is for the benefit of more than one lot or the common property.

1. It is not in dispute that the nature strips are on the road reservation which was vested in the Council on registration of the plan of subdivision. Accordingly, the nature strips which are located within the road reservation are not common property. It is not alleged that the respondents' actions in clearing the nature strip and planting it with lawn were contrary to s 47A(2)(a).
2. The owners corporation says that it was required to provide a service to all lot owners by virtue of the requirements of the section 173 Agreement and the OEMP. The owners corporation says that maintenance nature strip outside the respondents' lot is for the benefit of the respondents' lot, and for other lots in the vicinity.
3. The respondents say that the owners corporation was not providing the service of maintenance of the nature strip, and that it was the absence of any maintenance which prompted them to take action to clear the dead plants, animal faeces, rubbish and weeds which had accumulated in that area, and to replace it with lawn. That is, in effect, the respondents say there was no 'service' which they could alter, repair or maintain.
4. I consider the owners corporation's submissions in relation to s47A(2) of the OC Act to be misconceived. Section 47A(2) of the OC Act is concerned with services that are located within a lot, or which relate to more than one lot or to common property, and which are capable of being repaired, altered or maintained. The services contemplated by s 47A (2) are therefore tangible physical installations, capable of being repaired, altered or maintained. A 'service' such as garden maintenance is not a service that has a location. It is not a tangible thing. Rather, a service such as garden maintenance is an ephemeral activity, which is performed temporally and requires repetition. The 'service' of garden maintenance is not tangible, even though its results may be perceived. Such a 'service' is not capable of being repaired, altered or maintained. In my view, s47A is not concerned with services in the nature of garden maintenance.
5. I find that the respondents conduct in altering the planting on the nature strip did not amount to breach of s 47A(2).
6. It follows from my findings in relation to the Registered Rules relied upon, and in relation to s47A, that I must also find that the breach notices were not a valid exercise of the owners corporation's power to issue breach notices under s 155 and 157 of the OC Act.

Have the planning controls imposed an additional function on the owners corporation?

1. I have found that the Registered Rules relied upon by the owners corporation in this case are not a valid exercise of the power to make owners corporations rules. I have also found that the power conferred on an owners corporation by s 138 of the OC Act to make rules, is not a power to make rules in relation to any and all functions of the owners corporation, but that the power to make rules is limited to the matters specified in Schedule 1 to the OC Act.
2. The owners corporation submits that the planning permit, the OEMP and the section 173 Agreement confer functions on the owners corporation that require it to provide services, which include the service of maintaining the native plantings in the nature strips. The owners corporation submits that that 'service' is a service within the scope of items 3.1 and 3.3 of Schedule 1 of the OC Act.
3. The owners corporation submits that the function, or 'service', of maintaining the nature strips is a service provided to lot owners. It may be that lot owners might benefit from that function or 'service' being carried out, in that the amenity of the subdivision might be enhanced. To my mind, given that the land on which the 'service' is to be provided is land vested in the Council, it might equally be said that the service is provided to the Council.
4. Even if the 'service' were properly to be said to be provided to lot owners, the logic of the owners corporation's submission is that the obligation to maintain the nature strips was imposed first by the planning controls comprising the planning permit, the OEMP and the section 173 Agreement, and the subsequent implementation of that obligation by the owners corporation amounts to a 'service' to lot owners. Ordinarily, if an owners corporation wishes to provide a service that is not already contemplated by the OC Act, the owners corporation must be authorised to provide that service by a special resolution passed pursuant to s 12 of the OC Act.
5. I accept that the owners corporation passed a special resolution to authorise its entering into the section 173 Agreement, and passed a special resolution to 'adopt' the Registered Rules.
6. The owners corporation submits that the special resolution adopting the Registered Rules should be treated as though it were a special resolution to provide the service pursuant to s 12 of the OC Act. In my view, a resolution pursuant to s12 of the OC Act should explicitly refer to the provision of a service, and its terms and conditions, and should desirably refer explicitly to s 12 of the OC Act. That did not occur at the inaugural Annual General Meeting in 2012. In my view, the special resolution to adopt the Registered Rules cannot be considered to amount to a special resolution authorising the provision of a service pursuant to s 12 of the OC Act.
7. Indeed, I consider the special resolution at the inaugural Annual General Meeting relating to the Registered Rules was of no legal effect at all, due to the operation of s 24 of the Subdivision Act.
8. The questions of whether the conditions imposed by the planning permit are binding on the owners corporation, and whether a responsible authority can required an owners corporation to be a party to a section 173 agreement are not properly matters for determination in this proceeding. Enforcement of planning controls is a matter for the responsible authority and is not a responsibility of an owners corporation.[38]
9. For completeness I note that I consider it doubtful that planning documents such as an Environmental Management Plan, or a planning permit, or a section 173 Agreement should be considered to be 'any other law' for the purpose of s 4(f)(iii) of the OC Act. In my view, the reference to 'any other law' in section 4(f)(iii) of the OC Act , must refer to primary legislation, that is, an Act of Parliament. It may be that a regulation made under a regulation making power that is explicitly capable of 'conferring' additional functions on an owners corporation, and making explicit provision as to the effects of that conferral may also suffice, but that is not an issue that is before me today.

1. The respondents' conduct in clearing the nature strip and planting it with lawn was not in breach of the Registered Rules relied upon by the owner corporation and did not amount to a breach of s 47A of the OC Act. That being so, there is no ground for ordering the respondents to pay the owners corporation a sum of money for the reinstatement of the nature strip.
2. The application must be dismissed.

[1] https://www.sanctuarylakesresort.com.au/index.php/living-at-slr/about-the-resort accessed 7 July 2025.

[2] The owners corporation commenced this proceeding on the authorisation of its Committee, given at a committee meeting held on 3 May 2023. The claim amount nominated on the application form was $6,800.00.

[3] Applicant's Final Written Submissions dated 21 January 2025 paragraph 73.

[4] The owners corporation came into existence on registration of the Plan of Subdivision in September 2012. See s28 Subdivision Act 1988 (Vic).

[5] Applicant's documents page 178, Planning Permit Condition 44.

[6] Applicant's documents, page 179, Planning Permit Condition 45.

[8] OEMP page 3 at page 209/485 of Applicant's Documents dated 14 February 2024 (Applicants Documents).

[9] OEMP paragraph 4.1 at page 211/485 of the Applicant's Documents.

[10] OEMP page 8 at page 214/485 of Applicant's Documents.

[11] Pages 229/485 and 230/485 of Applicant's Documents.

[12] Applicants List of Documents Page 300/485 - see Recital J. The term 'WHPL Land' is a defined term in the Agreement and refers to land owned by the developer.

[13] Submissions of the owners corporation; Applicants List of Documents page 312/485.

[14] Owners Corporation's Written Submissions dated 21 January 2025, paragraph 18.

[17] Applicants Submissions dated 21 January 2025 paragraph 23.

[18] Section 205(1)(a) of the Local Government Act 1989 (Vic) ('LGA') provides that a council has the care and management of all public highways vested in the Council. A road referred to in s 205 of the LGA is a 'municipal road' for the purposes of the Road Management Act 2004 (Vic).

[19] Applicants Submissions dated 21 January 2025 paragraph 22.

[20] [2016] VSC 384 ('Balcombe').

[22] The term 'statutory rule' is defined in s 3 of the Subordinate Legislation Act 1988 (Vic). Owners corporation rules do not fall within that definition.

[23] [2017] VSC 790 at [18].

[24] See Building Services West Pty Ltd v Owners Corporation PS507524P [2022] VCAT 64; following Balcombe and Ainley.

[25] See subsection 27E of the Subdivision Act, which provides that on registration of the plan, the rules accompanying the plan must be taken to be rules made by the owners corporation under the OC Act and may be revoked or amended accordingly.

[26] To distinguish them from the Model Rules which otherwise apply.

[27] Rules 2 to 14 of the Registered Rules are concerned with obligations of the original owner and are not relevant to this proceeding.

[28] Applicant's Submissions dated 21 January 2025 paragraph 51.

[30] Respondents' Submissions dated 4 March 2025 page 4.

[32] Respondents' Submissions dated 4 March 2025, pages 5 and 6.

[33] Respondent's Documents pages 66-67.

[34] Mr Eaton's oral evidence in the hearing, referring to Respondent's Documents pages 57-68.

[37] Section 32(2) of the IL Act. See also, Building Services West Victoria Pty Ltd v Owners Corporation PS507524P (Owners Corporations) [2022] VCAT 64 at [158]-[164].

[38] Elwick 9 v Freeman [2018] VSC 234.