Phelan v Port Phillip CC [2023] VCAT 376

Phelan v Port Phillip CC [2023] VCAT 376 | Case summary | Zoe

[13]

This is a 'group matter' involving the one property at 102 Canterbury Road in Middle Park, but three proceedings, as follows:
- Two planning merits review proceedings brought by Sheila Phelan and the Preserving Middle Park Village Inc group (PMPV), being proceedings P1168/2022 and P1181/2022.
- A 'conditions appeal' brought by AVC, being proceeding P1232/2022.
The subject land is improved by the Middle Park Hotel (Hotel), situated on the corner of Canterbury Road (a higher order road, with the local railway station opposite) and Armstrong Street which is a local street leading down to the beach. The Hotel building is Italianate in style, is mainly three storeys high, but is lower and includes a courtyard at its southern/rear end.
In relation to the aerial photo of the Hotel shown at page 3 of the Urbis Planning Report dated 29 November 2021 that forms part of the permit application (Urbis Report), this photo shows the Hotel as having two rows of a wrap-around (probably corrugated iron) pitched roof, with six chimneys.
If one reviews the photo of the Hotel (taken from the other side of Canterbury Road) at page 18 of the Council Delegate Report dated 28 July 2022 (Delegate Report), this photo tells us that:
- In practice the roof of this three storey built form is hidden behind the building's parapet.
- There is a flagpole at the front/northern end of the Hotel.
The Council written submission states at [4] that the Hotel is "...used as a bar, hotel, tavern and licensed premises allowing the sale and consumption of liquor under a Late Night (General) Liquor Licence". The ground floor footprint of the Hotel has an area of about 800 sqm.
A Certificate of Compliance (C of C) was issued by Council on 18 October 2007, for 'the use and development existing on the land and referred to in this Certificate complies with the requirements of the planning scheme the date of this Certificate'.
The C of C refers to nine permits and applications for permits, which are discussed at [7] of the Council written submission. At [8] of that document it is explained that four more permits for Hotel buildings and works have been issued since the date of the C of C. Copies of most of the permits I have just referred to have been found by Council and filed as part of these proceedings.
The subject land is zoned Commercial Zone Schedule 1 (CZ1) and is affected by a Heritage Overlay Schedule 445 (HO445).
Council has received a planning permit application in relation to the Hotel for the proposal as summarised below:

[20]

The three day hearing before me unfolded as follows.
At a global level, it was one of the most fractious hearings I have presided over at the Tribunal. As I told the parties at the end of the hearing, if some or all of the parties have a strong view about in what order the parties are to present at a preliminary hearing and the practical implications of same, this should have been thrashed out at a previous PDH. This type of preliminary hearing is already challenging enough in grappling at length with complicated legal issues, without the hapless presiding member also having to deal with extensive bickering between the parties.
Having made certain procedural rulings along the way which are unnecessary for me to repeat here, the practical result with the running of the three day hearing before me was:
- All parties had pre-circulated a main written submission and AVC had also pre-circulated an Affidavit regarding the historical use of the Hotel authored by Mr Marino Angelini.
- There was a consensus before me that there was no need to call Mr Angelini to affirm his Affidavit or answer questions and I endorsed same.
- When the hearing got going properly, first Council provided some background information regarding the Hotel, the proposal and the relevant planning framework.
- AVC then presented its main submissions. I ruled that it was reasonable for AVC to go first with presenting its main submissions, as AVC was the party who had originally put in train the need to address these preliminary issues at the Tribunal. AVC making its main submissions at this stage involved extensive 'oral submissions' along the way by Mr O'Farrell, to elaborate on his written submission.
- Council and the barristers for the two objector parties then presented their main submissions. The submission by PMPV included detailed discussion of Seers v Macedon Ranges SC (Red Dot) [2016] VCAT 1198.
- As the hearing progressed, AVC requested that it be allowed to prepare a written summary of the various points it made through its aforementioned 'oral elaboration'. However this was opposed and at that stage I refused this request. A particular factor here was my concern to keep the hearing process workable and moving along, to ensure we could finish in the allocated three hearing days.
- Later on the second hearing day, where PMPV had made submissions to me regarding what it argued was the central role of the Seers decision, I noted that I had only been made aware of one subsequent decision that had cited Seers, in the form of Laurel Hotel Pty Ltd v Moonee Valley CC [2018] VCAT 995.
- At the beginning of the third and final hearing day, Ms Lardner advised that she had prepared overnight and already circulated to the other parties a two page written Schedule of 19 subsequent cases that had cited the Seers decision. As no other party objected to the Tribunal receiving this Schedule and Ms Lardner was strongly pressing that she should be allowed to table the Schedule and have more time to research and comment on these 19 cases, I had little choice but to confirm that there would be a follow up process 'on the papers' for Ms Lardner to comment on these 19 cases and then for the other parties to respond. [In the final result, Ms Lardner provided a detailed written submission on these 19 cases but only AVC made any written response to same. Ms Lardner then provided final written comments on that AVC response.]
- We completed all parties making their main submissions and then any 'rights of reply' by lunchtime on the third day. After lunch, I provided some oral feedback to the parties regarding my concerns with how difficult the hearing had been, and I made a ruling on the following final procedural issue.
At the beginning of the third hearing day, Mr O'Farrell made a further request that AVC be allowed to provide a written summary of its day 1 'oral elaboration', in a spirit of assisting the Tribunal in its deliberations and simply capturing in writing what was said by AVC on the first hearing day. By this stage, AVC had actually circulated this written summary to all of the other parties.
In response, Ms Lyle for the other objectors indicated that she had read the written summary and did not object to this course of action. Ms Marson had also read same but took a more muted position in indicating that Council more in-principle considered 'a written summary of oral submissions' to be unnecessary. Ms Lardner continued to oppose any written summary being provided by AVC, but acknowledging that she had not read the document by that point.
In this situation, at the very end of the hearing, I made a final ruling that given:
- there was going to be a follow-up process anyway after the hearing; and
- two of the three other advocates in Ms Lyle and Ms Marson had either raised no objection or put forward a more muted objection

[24]

Whilst a 'fierce debate' raged during the hearing regarding Questions 1 and 2, 'peace broke out' during the hearing regarding how to deal with Question 3.
Whilst wishing to reserve its rights to challenge the reasonableness or otherwise of the relevant permit conditions at the forthcoming scheduled main hearing, AVC advised me that it was content to defer the 'Question 3 debate' until that main hearing. It was then agreed that the parties would jointly prepare a suitable written statement confirming this outcome, which was in due course provided to me.
The essence of this joint written statement is as follows. Its paragraph 1 sets out Question 3. Its paragraph 2 notes that the origin of Question 3 appears to come from SM Code himself rather than from the comments made by the parties at the PDH before SM Code - paragraphs 12-13 from the PDH written remarks by SM Code are quoted to substantiate this.
The parties then invited me to endorse the position set out in the final three paragraphs of the joint statement, which say the following.
1. The parties have jointly submitted to me that I should refrain from dealing with Question 3 in this preliminary hearing. The reason for this is that the parties agree that the conditions in dispute are arguably valid but the question of whether the conditions are reasonable and should be applied is a matter for the merits hearing should a permit be issued.
2. I am prepared to accept this position that was put to me by the parties. I agree that until such time as the merits of the case are considered, it is not possible to determine whether the conditions are reasonable and should be applied in this case.
3. For these reasons I have not answered question 3 but hereby record the reasons for this. It will be a matter for the Tribunal in the merits hearing to determine whether the conditions are reasonable and whether they should be applied in this case and/or whether they should be amended.
In summary, I endorse the position set out in these three paragraphs I have quoted and am content to not make any finding on Question 3 for the reasons set out in these three quoted paragraphs.
It follows that as the hearing before me progressed, it was just Questions 1 and 2 that were debated and that I need to make a finding on.

[42]

In Harrington, the Full Court had stated, in the field of town planning, statutory provisions design to protect and preserve existing use rights should be liberally construed as the language in its context allows.
Insofar as the principle of liberal construction applies, the use is to be characterised at the appropriate level of generality that identifies the real and substantial purpose for which the is being used. This is not approached through a meticulous examination of the details of processes or activities, or a precise cataloguing of individual items. The courts have refused to categorise a use so narrowly or prescriptively that natural changes in the method of using the land or carrying on a business will render the existing use right valueless. Equally, the courts have been concerned not to categorise the purpose of a use so broadly that the land could be used for a prohibited purpose which was not given part of its use at the relevant date. One should simply ask what, according to ordinary terminology, is the appropriate designation of purpose being served by the actual use of the premises, and seek to describe such use only at that level of generality that is necessary and sufficient to broadly cover the activities at the relevant date. The common example given is from Harrington, where a use was characterised as being for the purpose of a bakery, not more specifically for the baking of bread, nor more generally for 'light industry'.
Another seminal decision in relation to EUR is City of Nunawading v Harrington [1985] VicRp 64; [1985] VR 641 - there was no disagreement between the parties before me regarding the basic EUR principles laid down in that case. One particular statement made in Harrington which is very relevant to the dispute before me is His Honour's statement at page 645 that the use and the activities on the land in question "...may change, increase or decrease, so long as the same purpose is served".
Also see the quote at page 15 of Ms Lardner's initial written submission, where Justice Cavanaugh in APN Outdoor Trading Pty Ltd v Melbourne CC [2012] VSC 8; (2012) 187 LGERA 231 discusses how courts and tribunals can consider whether the "use' of land can still occur in the absence of some activity, process or transaction. Although it is unnecessary for me to quote the full page of text from this APN Outdoor decision, I do highlight below the text from [59], again excluding any footnotes for convenience:

[46]

It is then useful to look at the leading first-principles cases on the spatial implications of EUR. At the hearing before me, the parties memorably referred to three such cases as being the 'holy trinity' of cases in this area of planning law[4]. These three cases (the Eaton, Brickworks and Newcastle Hospital cases) are captured in the useful text set out below, taken from Hoban v Mornington Peninsula CC [2007] VCAT 1931:
1. Mr Beasley sought to mount an argument on behalf of the responsible authority that perhaps the current 'planning unit' in relation to No. 73 does not extend over the whole area of that property, but only to the area of the existing building, or perhaps that building and its immediate surrounds. We do not accept that proposition.
2. We are well aware that various complications can be encountered in relation to the definition of the extent of the planning unit. Frequently, and most usually, a planning unit extends to the extent of the title boundaries of the land concerned, but that is not always necessarily the case. It is possible for the facts and circumstances to justify finding that part only of land in a particular title is for a particular purpose in terms of planning, just as it is possible for the same assessment to be made in relation to the land in more than one title or parts of more than one title. It is even possible for there to be more than one use of a single planning unit.
3. In relation to this question of the extent of a planning unit, the Full Court of the Supreme Court of Victoria had something to say in its decision in City of Nunawading v Harrington [1985] VicRp 64; [1985] VR 641 in numbered paragraphs 4, 5 and 7 beginning at lines 14, 19 and 32 on page 645. They read (with any underlining removed for convenience):
  1. Where land may properly be regarded as an integrated whole it is not necessary to show that all of it is used for a given purpose: Eaton & Sons Pty Ltd v Council of the Shire of Warringah [1972] HCA 33; (1972) 129 CLR 270.
  2. Use of land does not necessarily mean physical use: Council of the City of Newcastle v Royal Newcastle Hospital [1957] HCA 15; (1957) 96 CLR 493; (1959) 10 CRL 1; Parramatta City Council v Brickworks Ltd [1972] HCA 21; (1972) 128 CLR 1; Eaton & Sons v Council of the Shire of Warringah [1972] HCA 33; (1972) 129 CLR 270, at p. 273. These authorities also necessarily established that the use of the subject land may serve a purpose of use of other land.
  3. Land kept for vacant use as the needs of a business demand is not of necessity properly designated as land not in existing use but merely intended for a future use. Much will depend on the extent of its integration with the land in actual physical use and the nature of the business being conducted: Eaton & Sons Pty Ltd v Council of the Shire of Warringah (1972) 129 CRL 270, at p. 274, per Barwick C.J.; Parramatta City Council v Brickworks [1972] HCA 21; (1972) 128 CLR 1.

[57]

Following this line of thinking, there is no need for me to consider the physical extent of any EUR, because Seers is a 'knock-out blow' to any EUR that might otherwise have been enjoyed by the Hotel. Council and Ms Lyle took no particular position on this issue, but it was strongly opposed by AVC.
I think the best way forward here is to first review any relevant earlier cases, then review what legal principles (on a correct reading) that Seers stands for.
In the memorably named case Bada Bing Bada Boom Pty Ltd v Darebin CC [2009] VCAT 2729, in the course of looking at EUR issues, SM Byard stated that "Of course the company does not need to rely on existing use rights if it can operate pursuant to an existing valid permit".
Patty Malonnes Bar Pty Ltd v Melbourne CC [2010] VCAT 554 involved a planning dispute over the status of certain roof-top works at the Inflation nightclub in King Street in the CBD. By way of context, this roof top area is in practice essentially a flat roof with various improvements built on it, rather than being a conventional pitched tile, slate or Colourbond roof. The operator (with the support of Council) had lodged a retrospective planning permit application for these roof-top works, but the manager of the adjacent Rialto building objected.
At the hearing where all the parties had 'lawyered up' by the time that EUR were being discussed[6], Mr Michael Wright QC's first line of argument was that the contentious rooftop works came within the scope of the existing 1979 planning permit No. CM 1352 (which authorised alterations to the Inflations building, so it could be used for a cabaret and nightclub). In the alternative, he argued that EUR existed for the use of the rooftop area for the purpose of a nightclub, because of the long period that the nightclub had been continually running.
Where the Tribunal in Patty Malonnes was initially simply constituted by a non-legal member in Member Davies, it was then re-constituted to include myself, so that I could deal with this legal issue. At [23-37] of the legal findings, I considered the legality of the contentious roof top works and stated at [24] that "My finding is that this preamble to the 1979 planning permit is broad enough to authorise any part of the land for the purpose of a nightclub, including the rooftop area".
At [28] I stated that "As the Tribunal is relying on the 1979 permit in finding that the proposed roof top buildings and work need no further use approval, there is no need for the operator to convince me that this rooftop area enjoys existing use rights for the purpose of a nightclub", relying upon the aforementioned SM Byard quote from the Bada Bing Bada Boom decision.
In summary, when I read the relevant text from the Bada Bing Bada Boom and Patty Malonnes Bar decisions, the key point for our purposes is that in both cases the Tribunal:
- First looked to whether the planning permit in question provided the necessary 'use' approval.
- Took the approach that the Tribunal only needs to consider if EUR exist on an 'as needs' basis e.g. if the Tribunal is satisfied that any relevant planning permits do not authorise the contentious use.
This is really just common sense - EUR is an interesting but complex/more subjective area of planning law - why even 'go there' if you can first establish in a more straight forward and objective way that a relevant planning permit provides the necessary 'use' approval.
Nowhere in either of these cases is there any reference to the owner/applicant not being permitted to rely on EUR, if the contentious activities are found from a 'use' perspective to already be authorised by the relevant planning permit.
Rather, the Tribunal is simply relying on the concept of 'need' and therefore providing guidance with the proper approach/sequence to follow, in investigating the planning status of the contentious use. Following this approach, EUR should only be investigated when needed, rather than as the 'first line of enquiry'.
Turning to the Seers decision, the Red Dot Summary includes the following helpful paragraph:

[59]

On the one hand, I acknowledge that compared to the Bada Bing and the Patty Malonnes cases, Seers involved a different issue as follows - DP Gibson in Seers found that the use in question was as-of-right under the relevant planning scheme. In this situation, she ruled that it was not necessary for the owner of the subject land to seek to rely upon EUR.
On the other hand, I find that the Seers decision still ultimately does no more or less than broadly reinforce the same basic approach already taken in the two aforementioned cases. That is, I find that DP Gibson in Seers was likewise providing guidance on the correct approach or sequence for assessing if the necessary 'use' approval exists.
With the facts in Seers, as DP Gibson found that the relevant use was a Section 1 use under the relevant planning scheme, she then ruled that it was unnecessary to consider whether EUR could be made out. She expressly indicated that (with my emphasis) "...the issue of existing use rights will not be relevant".
Critically, on my reading of the Seers decision, nowhere does it go so far as to say that where there is a section 1 use in question or where a relevant planning permit exists and authorises the use in question, the owner is not permitted to rely on EUR. Rather, the flavour of Seers is that EUR should only be investigated as necessary, in the particular facts in question.
The position I have just set out makes sense when you consider that the circumstances before DP Gibson in the Seers decision included:
- The rights provided to the owner/operator by Section 6(3)&(4) of the Act as I have quoted further above.
- The further rights for the owner/operator afforded by Clauses 63.01, 63.04 and 63.11 of the planning scheme which I have also quoted further above.
Even if DP Gibson in theory had found that an owner is not permitted to claim EUR when the use in question is as-of-right, how could this be reconciled with the operation of these statutory provisions that I have just mentioned? These provisions and the rights they create for landowners were in play just as much in the circumstances of the Seers decision, compared to the circumstances of any other relevant planning dispute in Victoria i.e. DP Gibson could not just 'wish them away'.
I also agree with the comment by Mr O'Farrell that it is counter-intuitive to take the approach that:
- On land where for a certain use the planning controls involve a more 'light touch' - the use is as-of-right - there is the more harsh outcome that this owner is not permitted to claim EUR.
- On other land where that same use is more tightly regulated - the use is a section 2 or 3 use - there is the more positive outcome that the owner is permitted to claim EUR.
My findings here are consistent with the statements made at [35] of the final 5 page 'Reply submissions' provided by AVC, which I have reproduced below:
1. Seers and the cited cases do not support the contention that the Middle Park Hotel "is not permitted" to rely upon existing use rights. Rather, Seers and the cases cited show that in particular types of disputes it has not been "necessary" for the Tribunal to determine whether existing use rights exist.
2. The Act and the Scheme provides a right and entitlement for the Middle Park Hotel to rely on existing use rights. It elects to do so here.
3. In the present case it is 'necessary' for the Tribunal to determine whether existing use rights existing to determine the issues in dispute. That is because existing use rights can oust clause 52.27 by operation of law if they exist.
I likewise find that all of the 19 cases in the relevant Schedule provided by PMPV do no more or less than affirm the basic principles of Seers as I have summarised above - notably that the possibility of there being EUR in any one planning dispute should only be investigated 'as necessary'. As none of these 19 cases provide any support for PMPV's submission that Seers stands for the proposition that a contentious use which is as-of-right stops the relevant landowner being able to claim EUR, I found the discussion of these cases unhelpful.
I do not see Member Cook's key findings in the Laurel Hotel decision as changing the basic position I have just set out above. By way of context, this case involved a Tribunal review of certain proposed permit conditions arising from the intended amendment of an existing planning permit associated with the hotel. The permit holder/hotel sought certain Tribunal Declarations regarding EUR and the validity or otherwise of the relevant permit conditions.
In terms of the Tribunal's relevant comments on EURs, on the one hand, the Tribunal noted at [20] that "The reasoning in this decision supports my primary conclusion that the existing use right claimed is no longer the key determinant of the use under the current planning framework, since permission is no longer required for the use in question". On the other hand, if you read through the whole of this decision, there is extensive discussion of EUR and Member Cook makes various EUR findings[7]. Furthermore in the 'Conclusion', the Tribunal states (with my emphasis) that "My principal finding is that existing use rights do not need to be relied on in the current proceeding where the use is now as-of-right. I consider that the conditions that were imposed on the permit meet relevant tests of validity and continue to apply by virtue of clause 63.04".
The key point from this quoted test is that Member Cook was highlighting the lack of need to rely on EUR, but nowhere in her decision does she say that the permit holder was not permitted to rely on EUR.
I note that one of the 19 cases in the Schedule is my own previous decision in BSFW Investments Pty Ltd v Mildura RCC [2017] VCAT 191. In that case, it was disputed whether areas of an existing veterinary clinic had the necessary 'use' approval. At my [17], consistent with my findings set out above, I indicated that as per Seers, the starting point for my key considerations was whether the contentious use was either as-of-right or was approved by a planning permit.
I then (consistent with my approach in the Patty Malonnes decision) stated that "If the answer to either of these questions is 'yes', then Seers is authority that there is no need for the planning decision maker to delve into Clause 63 'existing use rights' considerations".
It also needs to be said that in reality very little for my purposes turns on the fact that Seers was most recently applied by Justice Quigley in Williams v Macedon Ranges Shire Council [2022] VCAT 621. Ms Lardner herself acknowledges at [18] of her written submission dated 20 February 2023 that in Williams, Her Honour actually accepted that applying EUR was appropriate[8].
My findings set out above regarding Seers are consistent with the fact that during the hearing before me, neither Council nor Ms Lyle pursued the interpretation of Seers which PMPV was promoting.

[61]

If you do a 'deep dive' into the framework for the operation of the Victorian planning system, I acknowledge that at a very generic level, the notion of 'fairness' is mentioned as being part of that system.
More particularly, with my emphasis, Section 4(1)(a) of the Act provides that one of the objectives of our planning system is "...to provide for the fair, orderly, economic and sustainable use, and development of land".
In addition, with planning hearings at VCAT, Section 97 of the Victorian Civil and Administrative Tribunal Act 1998 states with my highlighting that "The Tribunal must act fairly and according to the substantial merits of the case in all proceedings".
However beyond these very high-level references to notions of 'fairness', the operation of the various provisions of the Act and of any one planning scheme simply occurs in the usual way - these provisions 'are what they are'. In some situations these provisions might impose obligations or burdens on landowners, whilst in others these provisions may provide benefits or rights to landowners.
In this same spirit, the EUR clauses in the relevant State level planning scheme provisions essentially 'are what they are' and any one landowner is entitled to seek to apply those provisions to their own situation. Whether or not any such attempted application is successful 'is another story' and presumably over the years many owners have been unable to meet the necessary standard of proof to make out EUR for their land.
Given my comments immediately above, I find perplexing the argument being made by PMPV in its 20 February 2023 written submission that AVC is 'wanting to have it both ways'[9] and that AVC cannot invoke any 'principles of fairness' because here a hotel is an as-of-right use. As I have indicated above, surely AVC is just as entitled as any other owner to at least seek to invoke EUR.
Also important here is what Justice Quigley said on this issue in the Williams decision. At her [105] Her Honour stated as follows (with my highlighting):

[76]

From a 'chicken and egg' point of view, in Kevak the Tribunal held that where EURs had been established for the use of the site for the purpose of a hotel, no 'liquor licensing' planning permit is required under Clause 52.27. By contrast, in the earlier decisions of Kazer, Barjen and Bomvic, the Tribunal reached the opposite conclusion.
A useful way of describing this point of debate is whether the liquor licensing permit trigger created by Clause 52.27 is ultimately a 'use' type of control? AVC urged me to find that Clause 52.27 is a form of 'use control' and therefore comes within the scope of EUR, such that here no separate Clause 52.27 permission is needed. Council argued the opposite position.
For the following reasons, I find that:
- It is reasonable and appropriate that I apply/follow the Kevak decision, where the Tribunal in practice accepted that the EUR for the use of the site for 'hotel' effectively encompassed the sale and consumption of liquor.
- Hence I accept that Clause 52.27 is a form of 'use' control.
To the extent that Council urged me to reject Kevak and follow this earlier line of cases, I reject that proposition.
First, I give significant weight simply to the fact that Kevak represents a decision by an experienced legal member of the Tribunal as recently as last year. By contrast, the three cases relied upon by Council and which Council urged me to follow (Kazer, Barjen and Bomvic) were all decided between 19 and 24 years ago.
Second, the decision in Kevak is reinforced by the decision of DP Dwyer in McKinnon Hotels Pty Ltd v Glen Eira CC (includes Summary) (Red Dot) [2011] VCAT 413. On the one hand, I acknowledge that McKinnon Hotels involved the gambling provision 52.28 permit trigger, not the liquor licensing Clause 52.27 one here. However most of the logic and reasoning of DP Dwyer in McKinnon Hotels still seems very transferable to the Clause 52.27 dispute here before me.
The weight I can give to McKinnon Hotels is reinforced by the fact that:
- It is a Red Dot decision.
- It was authored by a Deputy President.
- It is more recent than any of the three aforementioned cases relied upon by Council.
Third, I see logic and common sense to Member Shpigel's key points that:
- It is incorrect to take the view that EURs can only continue on the basis that the uses and activities remain unchanged.
- As per her reliance on the paragraph [23] from the Wellington decision which I have quoted above, "...a use may be intensified over time, even with a change in activities within the use, without changing the purpose of the use".
Fourth, I agree with AVC that it reinforces the findings in Kevak that the definition of 'hotel' in the planning scheme overtly includes reference to the consumption of liquor. This definition reads - "Land used to sell liquor for consumption on and off the premises. It may include accommodation, food for consumption on the premises, entertainment, dancing, amusement machines and gambling".
Fifth, it was telling that of the three parties opposing AVC in this preliminary hearing, it was only one of those three (Council) that was arguing that Kevak was wrongly decided.
Sixth, I see some weight in the following point made by Mr O'Farrell. He pointed to the opening words of Clause 52.27 as follows (which I have highlighted) - "A permit is required to use land to sell or consume liquor...". I agree that this choice of words at the beginning of Clause 52.27 bolsters the argument that Clause 52.27 is a form of 'use' control.
Finally, I see major weight in the fact that the Tribunal in both Kevak and McKinnon Hotels recognised that the inherent role of a potential planning permit trigger under Clauses 52.27 or 52.28 (where a planning permit application might then be refused) constitutes a potential fetter on existing use rights.
That is to say, at [25] of Kevak Member Shpigel stated (with my highlighting):

[89]

At a glance it might seem that major guidance is provided by the decision Lemworth Pty Ltd v Liverpool CC [2001] NSWCA 389. This case involved a brothel which had been granted a planning permit to operate on the upper level of a two level building. Zoning changes over time then created the situation where (but for the planning permit and any EUR) the use of a 'brothel' was a prohibited use on the site. The brothel operator sought to expand the brothel into the lower level, arguing that the brothel had EUR to do so. In the resulting litigation, it was held that the extent of the EUR established was limited to the upper level of the building.
However I find that ultimately this Lemworth case turns on its own facts and has only modest persuasive value as a New South Wales (NSW) case. More particularly, I endorse the points made at page 10 of the 'Summary of Day 1 Submissions' AVC written document that:
- Lemworth involved a NSW 'existing use rights' provision that was worded differently to the Victorian relevant Clause 63 provisions.
- The Lemworth decision reserved for later consideration whether the ground floor enjoyed EUR.
- The brothel use in question operated under a planning permit which explicitly limited the extent of the use to the first floor.
Turning to Starray Pty Ltd v Sydney CC [2002] NSWLEC 48, it was an appeal against Council's refusal to support a proposed public car park. During the period in question, the relevant planning controls changed as follows - public car parks were prohibited in central Sydney, subject to certain exemptions.
This in practice led to the permit applicant claiming EUR, where it was undisputed that an at-grade short stay public car park had operated on the subject land since at least 1985. The key complication was that the permit applicant wished to replace this at-grade car park with a two level underground car park. In other words, the permit applicant contended that the EURs in question extended underground, so that no 'use' approval was needed for same.
I acknowledge that the Land & Environment Court rejected this contention and held that the extent of the EUR in question was simply at ground level. It highlighted at [24] that "Starray did not use any subterranean strata of the site for the purpose of that use, not did it hold those strata in reserve for that purpose".
However I see this case as turning on its own facts and carrying limited weight for my purposes, as:
- It is a NSW case involving different legislation.
- Starray involved a debate about whether EUR can be seen as extending below ground level into soil (which has its own issues), whereas by contrast the debate before me has been whether EURs extend upwards to the airspace immediately above the existing Hotel roof.

[91]

I have recognised further above that (where EUR are involved) I find it useful to apply the test from Simpkin of whether a contentious area of land can be reasonably said to be part of the 'present use' of that land from an EUR perspective.
Coming back to the circumstances of this dispute, I have indicated further above that I accept that the Hotel land as a minimum has EUR for the activities occurring inside its existing external walls and roof.
I have also confirmed in my introductory comments that the roof of the proposed roof deck covered area would sit about 4.5 metres higher than the Hotel's existing ridge line.
The $64 question then becomes whether or not the EUR that attaches to the Hotel land (in shorthand, the planning unit) includes the airspace immediately above the existing roof, where the proposed rooftop deck would be located? In other words, does the 'present use' of the Hotel land include such airspace? During the hearing AVC strongly submitted this was the position and hence the proposed rooftop deck takes the benefit of the Hotel's EUR, whereas the other parties strongly argued the reverse position.
For the following reasons, I find that the vertical extent of the EUR which the Hotel land enjoys does include the airspace immediately above the existing Hotel roof where the proposed rooftop deck would be located i.e. the 'present use' of the Hotel land includes this airspace. When this finding is combined with my affirmation of the Kevak decision, my overall decision is to accept AVC's position on the Question of Law 1.
At a more straightforward level, I accept that:
- It would be the same 'hotel' use occurring, with the proposed rooftop deck activity. The definition of 'hotel' is broad, I have already found that the Hotel as a minimum has EUR for the hotel activities occurring within the current external walls and roof, and I accept that the proposed rooftop deck would simply constitute an intensification of the same on-going use of the land for the purpose of a 'hotel'.
- There are no planning scheme 'height controls' in play here.
- There are no existing permit conditions or 'notes on an endorsed plan' which prohibit the proposed rooftop deck built form and activity.
My finding here is reinforced by the following statement (with my highlighting) by DP Gibson at [66] of Seers - "Existing use rights attach to land, not particular buildings on the land. Where land may be properly regarded as an integrated whole, it is not necessary to show that all of it is used for a given purpose".
It is common sense and reasonable to take the view that the day-to-day use of land improved by a commercial building includes some extent of such use of the airspace immediately above that building. The airspace immediately above the roof of a commercial building is typically used as-applicable for:
- Simple maintenance like cleaning out gutters or replacing broken or aging tiles/slate/iron.
- Access to sunlight for any skylights.
- Being able to install plant and equipment like a TV antenna, satellite dish and/or an air conditioner compressor and then have access to service or replace same.
- Being able to install and then have access to any approved roof signage.
- Being able to install and then have access to any solar panels.
- Any chimneys to enable smoke/heat to disperse from the building.
- Piping to vent odours away from the building.
- Roof exhaust fans.
It would be nonsensical for these type of day-to-day activities taking place in the airspace immediately above the roof of a commercial building to on a strict view require 'use' approval under the relevant planning scheme.
Returning to the circumstances here of the period Hotel on the subject land, I am satisfied that there has been a 'present use' of the airspace immediately above the existing roof, where the proposed rooftop deck would be located. Notably, I am satisfied that such airspace immediately above the existing roof where the proposed roof deck would be located forms part of the 'integrated whole', where such airspace has been for decades and continues to be used as part of the purpose of a 'hotel' on the subject land.
An obvious example of this is the 'present use' of the airspace immediately above the existing Hotel roof to be able to clean out the roof guttering, to check the condition of the roof and/or to do maintenance on the roof. As a minimum, three other 'present uses' of the airspace immediately above the Hotel roof are:
- The use of such airspace to operate the roof-top flag pole as shown in the photo at page 18 of the Delegate Report. This photo actually shows the flagpole being actively used.
- The use of such airspace for any maintenance to/replacement of the Hotel rooftop TV aerial that was specifically mentioned by Mr O'Farrell during the hearing.
- The use of such airspace for the dispersal of smoke/heat from any of the six chimneys on the Hotel roof (as applicable) as shown on the aerial photo at page 3 of the Urbis Report.
Taking this same view of what constitutes 'the typical vertical use of land' a step further, it is common for the owner of a single storey detached dwelling on residentially-zoned land to over time need more space and wish to add an upper level extension to their dwelling. It is common that in this situation,[11] the only permissions required are:
- simply a building permit; or
- a 'buildings and works' planning approval and then a building permit.
I understand this situation to likewise (at least implicitly) involve a recognition that whatever planning rights are enjoyed by the existing single storey dwelling on residentially-zoned land extend to the airspace immediately above it. How else otherwise can you explain the fact that simple double storey extensions of existing residentially-zoned detached single storey dwellings in Victoria are commonly built without needing any planning approval?
My overall finding on Question of Law 1 is consistent with the substance of the approach taken in the Argo Hotel and the Patty Malonnes decisions. In those previous decisions, the Tribunal took a fairly robust approach to the vertical extent of the planning rights which the Tribunal found to exist with the buildings on each of the land in question.
My findings set out above are reinforced by the following final points.
Where the basic position is that any EURs attach to land, I agree with AVC that it is significant that Section 3 of the Act includes a very broad definition of 'land', which I have shown below (with my emphasis):

[101]

Council (with the support of the objectors) highlighted and relied on the following points:
- The words which I have underlined from the quote above describes the exemption as either applying or not applying to the relevant land, not to the relevant buildings and works.
- If the criteria is 'land' rather than 'buildings and works', this points to the need to consider the operation of the exemption vis-à-vis the relevant title boundaries of the subject land.
- It is undisputed in itself that the closest corner of the nearest residentially zoned land (the rear of the 255 Richardson Street property[13]) lies 25.75 horizontal metres from the closest corner of the subject land.
Hence both Council and the objector parties urged me to find that because of the subject land and the 255 Richardson Street property being less than 30 metres apart, this third party exemption does not apply to the circumstances here and the respondents do have standing in the proceeding P1232/2022.
In its original written application, AVC in brief terms states at [25] that "The proposed buildings and works are more than 30 metres away from any residential zone". I understand the thinking here to be that the practical emphasis should be on the footprint of the buildings and works in question, not the relevant title boundaries.
Following this line of thinking, AVC does have the benefit of the Clause 34.01-7 third party exemption because:
- The footprint of the area of the proposed buildings and works only applies to the northern section of the subject land.
- Emphasis should be given to this footprint area, rather than the relevant title boundaries of the Hotel land.
- The southern edge of the footprint of the intended buildings and works would be over 30 metres away from the closest corner of the 255 Richardson Street property.
In its 'Summary of Day 2 Reply Submissions' written document, AVC essentially makes the same argument in the following way:
- at [39] AVC describes its preferred emphasis on the extent of the physical works as "...the land the subject of regulation, requiring permission"; and
- characterises the position of Council and the objectors on this issue as a mistaken emphasis on the "...cadastral boundaries of the land...".
Further AVC 'bolstering submissions' are put at [40-41] of this Reply Submissions document, which for convenience I shall address further below.

[102]

At a simple and holistic level, the fatal problem I see with AVC's position on Question 2 is as follows.
The key text from Clause 34.01-7 (with my emphasis) is "...This exemption does not apply to land within 30 metres of land (not a road) which is in a residential zone...".
For my purposes here, the key single word from the quote above is 'land'. In other words, the parliamentary draftsperson(s) could have used the words 'buildings and works' or 'land affected by buildings and works', but that person(s) simply chose the word 'land'.
Where the chosen word is 'land', I accept that the most obvious and workable way to understand and apply the word 'land' is that the 'land' is all of the area inside the relevant title boundaries. Accordingly, subject to the proviso discussed further below, I see it as a contrived and unconvincing approach to treat the 'land' as anything less than the relevant title area in question. This is consistent with the statement in the APN Outdoor decision at [52] that "Land is not developed for the sake of development but is developed for use".
This finding is reinforced by the fact that the street address shown in the relevant planning permit application and the VCAT Application for Review form was not some smaller area but simply '102 Canterbury Road, Middle Park' i.e. the whole site.
It was also telling that AVC did not cite any previous caselaw supporting its preferred position that the word 'land' should be read narrowly (with an emphasis on the extent of the relevant buildings and works) for the purposes of Clause 34.01-7 i.e. it appears there is no such supportive previous caselaw.
On this basis, subject to the proviso mentioned further below, my answer to Question 2 is 'yes, the respondents do have standing in proceeding P1232/2022'.
Even if in theory I prima facie took the word 'land' in the fifth line of Clause 34.01-7 to (despite the absence of the words 'buildings and works') implicitly mean that the 'land within 30 metres' requirement is only to be applied to the footprint of the proposed buildings and works, I see several potential major complications with how in practice this would play out here:
- It is not as if this is a very large block of land where the Hotel built form separately sits on the northern section of the site and its southern section is separately fenced-off, vacant and not involved in the day-to-day operation of the Hotel. There is no simple demarcation like this here - we know that in practice the Hotel is built out to its boundaries, albeit with a rear courtyard area.
- Even where currently I understand that AVC does not propose to carry out any 'buildings and works' in the southern section of the subject land, if a planning permit for the proposed roof deck was granted on that basis, what if during the project complications arose and AVC needed to amend its planning permit to include more southern-oriented 'buildings and works'?
- Where would it leave AVC's position on this Question 2 issue if a planning permit was granted, this project goes ahead and the project workers/tradies in practice use the southern courtyard area for 'vehicle or pedestrian project access', or for storing project tools, equipment, materials, etc. Certainly no evidence was presented to me by AVC that it will be able to 'completely quarantine off' the southern section of the subject land from this type of day-to-day construction activity.
The above-mentioned proviso is as follows. With Question 2, AVC rhetorically raised the following scenario to try to advance its own submissions. AVC argued that if the parcel of land in question was huge and if the footprint of the proposed 'buildings and works' was situated a huge distance away from the nearest residentially zoned neighbouring property, it would be unreasonable to still prioritise the relevant title boundaries for the purposes of the Clause 34.01-7 'within 30 metres' exemption.
My initial impression is that there would in this more extreme type of circumstances at least be a 'debate to be had', whether the word 'land' means 'all of the relevant title land' for the purposes of the 'within 30 metres' exemption. However this is a quite different situation to that before me here, is not something I need to decide and is an issue for another day.
Finally, I comment as follows on AVC's submissions at [40] and [41] of its 'Summary of Day 1 Reply Submissions' document.
Where in [40(a)] there is the use of the phrase "The C1Z does not 'speak to' anything it does not regulate", I find this phrase very cryptic and not really 'advancing the debate in any helpful way'.
Where in [40(b)] it is argued that the 'four corners' of the planning permit application is no more than the northern area where the physical works are proposed i.e. this is the land to which the C1Z is 'speaking to':
- This 'bumps up' against the fact that the planning permit application described the 'land' as its whole street address of 102 Canterbury Road.
- It does beg the question why the parliamentary draftsperson(s) in line 5 of Clause 34.01-7 simply used the word 'land', with no reference to 'buildings and works'.
- See my comments five paragraphs above about the practical complications that might arise during the project.
Where [41] talks about using a 'purposive approach' to applying Clause 43.01-7, I see this as essentially 'clutching at straws'. However see my comments four paragraphs above regarding whether there might be at least a 'debate to be had' in the extreme scenario being posed, etc.

At a glance

Court

Decision date

Source

Judgment (116 paragraphs)

Phelan v Port Phillip CC [2023] VCAT 376 (13 April 2023)

Parties

Legislation Cited (3)

Cases Cited (4)