Plaintiffs v Defendants

1. The plaintiffs, Ms Angela I-Chi Chao and her husband, Mr Cheng Li-Fu, are the registered proprietors of a property at 2 Page Avenue, Kew East[1] ('subject property'). The subject property is located on the corner of Page Avenue and Baker Avenue. The subject property is a traditional 'quarter-acre block', being approximately 925 square metres in dimension,. The subject property is developed with a single-storey brick house constructed in the 1940s and is divided internally by a paling fence. The fence creates the impression that the part of the subject property fronting Baker Avenue is a separate, largely vacant lot.

1. Figure 1 shows the subject property, marked by a blue arrow, in its broader suburban context. The subject property is in the north-eastern corner of a large residential precinct bounded by Kilby Road (and beyond that, the Eastern Freeway) to the north, Belford Road to the east, Earl Street to the south and a park and a revegetated disused railway line to the north and north west. However, the parties agree that the neighbourhood, for the purposes of assessing whether the modification of single-dwelling restriction will cause the beneficiaries substantial injury, is the subdivision itself (the area labelled 'LP12281' and outlined in red in Figure 1 ('subdivision')) and the southern side of Baker Avenue, which is part of the adjacent subdivision (the area outlined in blue and labelled 'LP12282' in Figure 1).
2. The plaintiffs wish to redevelop the subject property by subdividing the land into two lots, and constructing a substantial double-storey home on each lot, taking advantage of the subject property's position on the corner of Page Avenue and Baker Avenue. One house would have a street frontage to Page Avenue, and the other would front onto Baker Avenue. The proposed subdivision and the plans for the new dwellings are contained in a reasonably detailed concept plan prepared by the plaintiffs' architects ('concept plan'), as shown by the plans for the ground level and the south elevation (showing the view from Baker Avenue) reproduced in Figure 2 below.

1. It is common ground that the plaintiffs will have no difficulty in obtaining planning approval for the construction of two dwellings on the subject property ('proposed development'). Rather, the main hurdle facing the plaintiff is that the subject property, like all of the other properties within the vicinity of the subject property,[2] is burdened by a restrictive covenant limiting the number of dwellings on the subject land to one ('single-dwelling restriction').[3]
2. The network of overlapping single-dwelling restrictions in the subdivision and the neighbouring subdivisions have largely been complied with. The red dots on the aerial photograph in Figure 1 show that two lots in the subdivision and one lot in the neighbouring subdivision have been developed inconsistently with the single-dwelling restriction. In the north-west corner of the subdivision, opposite a park, a block of four unsubdivided dwellings were constructed in the 1960s or 1970s, in an apparent breach of the single-dwelling restriction. Further, in 2010 this Court made orders,[4] in an unopposed application, to modify the single-dwelling restriction upon the property at 1 Page Avenue, opposite the subject property,[5] and an additional dwelling was constructed on this lot at 63A Baker Avenue.
3. The plaintiffs have applied for an order under s 84(1)(c) of the Property Law Act 1958 (Vic) ('Act') for an order modifying the single-dwelling restriction to permit the proposed development. They have proffered an undertaking to the effect that, if the Court grants the application, they will redevelop the subject property substantially (or in town planning parlance, 'generally') in accordance with the concept plan.
4. Section 84(1)(c) of the Act provides that the Court may make an order removing or modifying a restrictive covenant if the Court is satisfied that the removal or modification will not case substantial injury to the beneficiaries of the restrictive covenant.
5. There are seven defendants in this proceeding, being the registered proprietors of six properties with the benefit of the single-dwelling restriction.
6. None of the defendants' properties are immediately proximate to the subject land. However, they say that they will suffer substantial injury by reason of the modification of the single-dwelling restriction by reason of the impact of the proposed development upon the quiet, garden suburb character of the neighbourhood. Further, they say that the modification of the single-dwelling restriction could compound the impact of the proposed development by setting a precedent for further applications by the owners of similarly sized and situated parcels of land in the neighbourhood.
7. In summary, I am not satisfied that the proposed modification will not cause substantial injury to those entitled to the benefit of the single-dwelling restriction, and the application should be dismissed. My reasons follow.

1. The parties agree that the neighbourhood contains the subdivision, along with the southern side of Baker Avenue, which is in LP12282. A plan of the subdivision taken from VicPlan is attached as a schedule to these reasons, marked up to show:

(a) the subject property;

(b) the properties that have the benefit of the restrictive covenant;

(c) the properties owned by the defendants;

(d) the lots which have been developed with multiple dwellings;

(e) the lots which the defendants say are comparable lots to the subject property; and

(f) comparable lots in LP12282.

1. There are 80 lots in the subdivision, and a further 33 lots on the south side of Baker Avenue (in LP12282), not including a lot fronting Belford Road with a side frontage to Baker Avenue (also in LP12282). Unlike LP12282, the subdivision stops short of Belford Road, as the corner of Kilby Road and Belford Road is developed as a small scale retail/commercial precinct, populated largely by health and well-being related businesses.
2. A report prepared by a town planner engaged by the defendants dated 3 June 2025 ('Milner report') describes the neighbourhood as follows:

Largely developed post war on a grid network of streets, most of the neighbourhood and postal code was subdivided into conventional rectangular lots, popularly characterised as 'quarter of an acre lots' with single storey detached housing stock predominating.

Topography and a water course (now piped) influenced a modification of the grid network with White, Baker and Mathers Avenues being established as oblique intersecting streets.

Page Avenue in the above context is an exception to the regular street network being a short oblique intersecting street, possibly created to mark the transition between rising land to the east and flatter land to the west.

Page Avenue lots have oblique rather than rectangular frontages as found across the balance of the original subdivision and the estate.

A process of renewal and gentrification is evident across the neighbourhood with small, single, storey inter and post war, detached housing being redeveloped or extended to be replaced by an emerging presence of larger two storey homes in a range of contemporary and reproduction styles.

1. The relatively low density of the neighbourhood and its moderate coverage of vegetation is evident from the aerial photographs included in the Milner report and reproduced below.

East end of subdivision with subject property identified by blue arrow

1. The subject property is described in a report prepared in July 2024 by Mr Michael Constantine, a town planner engaged by the plaintiffs ('Constantine report') as follows:

The subject [property] is irregular in shape and has a 35.27m wide frontage to Page Avenue, a 25.20m wide frontage to Baker Avenue, and a maximum depth of 50.84m, yielding an overall site area of 927m2.

The site slopes by approximately 5m from the southeast, down toward the north-western corner of the site. ...

The subject site is currently occupied by a single-storey brick dwelling with a pitched tile roof form, which is located centrally on the site.

Vehicular access is provided via one single-width vehicle crossing per site frontage.

The rear portion of the site is currently fenced in for privacy, and includes a high paling fence that occupies part of the Baker Avenue frontage.

The site is lightly vegetated by a small trees and shrubs.

1. Figures 7 and 8 below show the subject property from Page Avenue and Baker Avenue respectively.

1. The subject property was transferred out of the parent title of the subdivision in 1941, and the house on the subject property was probably constructed around that time. The lack of any substantial canopy trees or substantial shrubbery means that the subject property does not contribute much to the 'garden suburb' character of the neighbourhood. As noted by Mr Milner in the Milner report, while the subject property is located at the eastern end of the subdivision, it is quite prominent in the subdivision, given the topography of the subdivision, and the size and corner location of the subject property.
2. Figure 9 below shows the subject property and its immediate neighbours.

1. As can be seen from figures 7, 8 and 9, the subject property is currently developed with a rather nondescript house, and a metal garage on the part of the lot separated from the house by a paling fence.
2. The proposed development involves the demolition of the existing house, dividing fence and garage, and the construction of two contemporary dwellings. The dwelling facing Baker Avenue will be constructed on a rectangular block with a nine metre setback, consistent with the setback of the neighbouring properties along Baker Avenue. The concept plan shows a double garage, kitchen/living/dining area and a guest suite/home office on the ground floor, along with four bedrooms and rumpus area on the first floor. The proposed dwelling fronting Page Avenue will also have five bedrooms, but more generous living spaces downstairs. Both dwellings have outdoor living spaces adjacent to each other and the boundary of 4 Page Avenue, with modest setbacks from the boundary.
3. Together, the two dwellings will have a footprint covering approximately 50 percent of the subject property, excluding driveways. While the setback of the dwelling fronting Baker Avenue is consistent with the setbacks commonly found along the north side of Baker Avenue, the setback will be obscured from the west by the dwelling fronting Page Avenue.

1. The plaintiffs relied upon an affidavit submitted by the second plaintiff, Mr Li-Fu. Mr Li-Fu affirmed that the plaintiffs 'intend to carry out [the proposed development] substantially in accordance with the concept plan'.[6]
2. The defendants did not give oral evidence at trial, as their evidence was not challenged by the plaintiffs. Affidavits made by the first to fourth defendants were in evidence. Most of the defendants live at their properties, while one defendant leases their property to tenants. One defendant has lived in the neighbourhood for over 35 years. Some of the defendants have raised a family in their property and others still have their children, grandchildren and other family members residing with them.
3. Each of the defendants deposed that they believed that the character of the neighbourhood would be detrimentally altered if the application was granted and the proposed development proceeded. The defendants were particularly concerned with the precedential effect of granting the current application should further applications to vary covenants in the neighbourhood be made in the future.
4. The fourth defendant, Ms Arna Andrews, gave evidence that the single-dwelling restriction was the reason she purchased her property and continues to live there. She said that the neighbourhood is well suited to raising a family, providing a safe environment for children with low traffic levels and good outdoor facilities. She noted the generally 'pleasant ambience' of the neighbourhood, and referred to her objection to a prior application to vary the single-dwelling restriction burdening 3 Page Avenue. While Ms Andrews did not object to the variation of the covenant on 1 Page Avenue, she said that she would have done so had she received notice of the application. She believes that granting the application will adversely affect the neighbourhood character and may lead to other inappropriate development in the neighbourhood.
5. The second defendant, Mr George Midas, deposed that his household is multi-generational, with three generations of his family residing at his property. His reason for moving to Baker Avenue was the single-dwelling restriction, having previously lived in a part of Kew which transformed from a neighbourhood containing primarily single dwellings to a neighbourhood replete with medium density developments, resulting in increased traffic and a change in the character of the neighbourhood. He also referred to the suitability of the neighbourhood for families, with the low density nature of the neighbourhood providing for privacy, child safety, reduced traffic and neighbourhood cohesiveness. He further noted the neighbourhood's harmonious streetscape, visual amenity, peaceful living environment and sense of community, which he believes is facilitated by the single-dwelling restriction.
6. While Mr Midas did not live in the neighbourhood at the time the covenant for 1 Page Avenue was varied, he said that he would have objected if he had. His concerns about the proposed development include increased traffic and noise, adverse impacts to the aesthetic of the neighbourhood and sense of community, a reduction in property values, and a shift towards medium density developments in the neighbourhood.
7. The first defendant, Ms Julie Hazlett, likewise claims to have purchased her property for the benefit of the single-dwelling restriction. She considered that the single-dwelling restriction made the neighbourhood suitable for raising her family. However, she now leases the property to tenants. She observed that the single-dwelling restriction has facilitated spacious gardens, taking pride in her own garden which she has maintained for the benefit of her tenants, who have also enjoyed living in the neighbourhood.
8. Ms Hazlett objected to the application to vary the single-dwelling restriction burdening 3 Page Avenue, and would have objected to the application to vary the single-dwelling covenant burdening 1 Page Avenue had she been aware of the application. She believes that the proposed development of the subject property will be 'visually dominating' and does not provide sufficient allowance for vegetation or gardens, which are common elsewhere in the neighbourhood.
9. The household of the third defendant, Mr Cameron Paice, like that of the second defendant, is multi-generational. He deposed that the single-dwelling restriction has several benefits, chiefly ensuring a spacious environment, reduced noise pollution and reduced traffic. He observed that the single-dwelling restriction ensured the house his family built was built in a style consistent with the neighbourhood, retaining trees and garden space for children to play. His principal concern with allowing the plaintiffs' application is an increase in housing density and the potential for future developments of multiple dwelling on single lots, which he says will have a detrimental impact on neighbour character.
10. The defendants also relied upon affidavits made by their solicitors, Ms Tania Cincotta and Ms Jun Yu. In her affidavit affirmed on 17 June 2025, Ms Cincotta:

(a) referred to the unopposed application made to this Court for the modification of the single-dwelling restriction burdening the property at 1 Page Avenue, and exhibited the orders made in that proceeding, including the order showing the relatively limited scope of the notification process for that application; and

(b) referred to the adjacent subdivision at LP12282, and observed that single dwelling covenants appear to apply to lots in that subdivision.

1. In Ms Yu's affidavit affirmed on 28 October 2025, Ms Yu deposed that she had undertaken a review of the lot sizes in the subdivision using 'aerial imagery and mapping tools available through Nearmap and Vic Plan'. She identified the following lots within the subdivision as being of a comparable size to the subject property (approximately 925 square metres), as follows:

• 3 Page Avenue, Kew East - lot 76 - approximately 908 square metres

• 4 Page Avenue, Kew East - Lot 77 - approximately 1,076 square metres

• 5 Page Avenue, Kew East - Lot 13- approximately 1,095 square metres

• 6 Page Avenue, Kew East - Lot 12 - approximately 905 square metres

• 7 page Avenue, Kew East - Lot 14 - approximately 917 square metres

• 8 Page Avenue, Kew East - Lot ·11 - approximately 937 square metres

• 31 Baker Avenue, Kew East - Lot 58 - approximately 907 square metres
• 33 Baker Avenue, Kew East- Lot 59 - approximately 885 square metres
• 6 Kilby Road, Kew East - Lot 29 -- approximately 861 square metres
• 38 White Avenue, Kew East -- Lot 45 -- approximately 808 square metres
• 40 White Avenue, Kew East - Lot 44 - approximately 798 square metres
• 42 White Avenue, Kew East - Lot 43 - approximately 908 square metres
• 44 White Avenue, Kew East - Lot 42 - approximately 901 square metres

1. Further, I also had the benefit of visiting the neighbourhood on two occasions. The first occasion was on the morning of Monday 10 November 2025, the day prior to trial, when I spent around half an hour driving around the neighbourhood and beyond[7] to familiarise myself with the area.
2. My next visit was on the morning of Sunday 30 November 2025, while preparation of these reasons was underway. I spent approximately 45 minutes walking around the neighbourhood, including along the pedestrian walkway between Baker Avenue and Kilby Road. During the course of my visit, I made the following observations:[8]

(a) the neighbourhood is quiet and peaceful, with limited pedestrian and vehicular traffic, although the tranquil nature of the neighbourhood, and Kilby Road in particular, is somewhat disturbed by traffic noise emanating from the Eastern Freeway. The retail/commercial precinct on the corner of Kilby Road and Belford Road is not characterised by any 'hustle and bustle', owing to the nature of the businesses located there;

(b) large canopy trees in rear yards of the properties in the subdivision can be viewed from most streets in the subdivision, including when looking uphill to the south from Kilby Road, and the vegetated nature of the subdivision is also particularly apparent from the high side of Baker Avenue;

(c) most of the newer developments in the neighbourhood have some soft landscaping. While these plantings are generally more formal in character than the gardens around the more established dwellings, it is likely that this vegetation will mature and soften over time;

(d) while not uniform, the inter-war/immediate post-war architectural style of the neighbourhood remains generally intact, while the setbacks, particularly along Baker Avenue and Kilby Road, are consistent and generous;

(e) I would described the character of the area as moderately vegetated, rather than lightly to moderately vegetated, as opined by Mr Constantine;

(f) the bus stop outside 7 Page Avenue is quite a simple structure, while the bus stop outside 6 Kilby Road is a more substantial structure, with a shelter having been constructed there;

(g) that the property at 63A Baker Avenue has a limited rear setback is evident when viewed from Baker Avenue;

(h) a number of the properties on Page Avenue, including the subject property appear to be 'ripe for development', were they not burdened by the single-dwelling restriction; and

(i) the subject property is quite a dominant site in the neighbourhood, particularly when viewed walking east along Baker Avenue.

1. The plaintiffs relied upon the evidence of Mr Constantine, the author of the Constantine report and an addendum to that report dated 14 November 2024 ('addendum'). The defendants relied upon the evidence of Mr Robert Milner, who prepared the Milner report. Mr Constantine also prepared a report in reply to the Milner report dated 31 July 2025 ('second Constantine report'). Both Mr Constantine and Mr Milner gave evidence at trial.

1. The Constantine report emphasised the relevance of town planning policies that assist in the preservation of the character of the neighbourhood,[9] regardless of the single-dwelling restriction. As conceded by Mr Constantine in cross-examination, the Constantine report made no reference to the test under s 84(1)(c) of the Act. The report also noted the subject property's location on a corner and, accordingly, its large frontages to two streets, which Mr Constantine said enables the subject property to be developed with multiple dwellings in a manner consistent with the character of the neighbourhood.
2. Mr Constantine opined that the neighbourhood has a 'varied character'. He noted that multi-dwelling properties are in the minority, but can be found sporadically throughout the neighbourhood, with detached or semi-detached two-dwelling developments being the most common. He also noted that within the subdivision itself there exists a multi-dwelling property which was built after a variation of a similar covenant.
3. Mr Constantine opined that the concept plan demonstrates that 'more than one dwelling can be reasonably accommodated on the subject site' with the 'generous size of the subject [property]' enabling each dwelling to sit on a site of 463 square metres.[10] He emphasised the fact the subject property is a corner property and that each dwelling will front a different street.
4. Mr Constantine noted that the neighbourhood is one of light to moderately vegetated allotments. He opined that the generous frontage of the subject property will facilitate the establishment and maintenance of 'meaningful vegetation', consistently with the moderately vegetated character of the neighbourhood.
5. The Constantine report particularly focused upon the relevant policy framework, namely the Neighbourhood Residential Zone ('NRZ') and Boroondara Planning Scheme, and the requirements imposed therein. The report noted that the proposed development meets the mandatory requirements of the NRZ, namely that the proposed development provided more than 35 percent of open space, is no more than two storeys in scale, and is below the 10 metre maximum building height.
6. Under the heading 'Assessment of Injury', the Constantine report opined as follows:

A two-dwelling development outcome is consistent with the residential density currently present in this localised area of Kew East, which is within walking distance of schools, public open space, and public transport routes.

The proposed density of the development is one dwelling to each 463m2 of site area. This density is appropriate in the context of the existing infill development within the surrounding area. To this end, it is not considered that a two-dwelling development would significantly alter the character of the area.

The subject site is ideally located for respectful infill development at a medium density, as it is located within proximity to regular destinations. It is noted that any such development must respect neighbourhood character and amenity objectives, and this can be achieved with a two-dwelling development due to the generous size of the subject site.

While the design is very generous in size, the proposed setbacks, separation, form and scale of the concept development generally reflect that of other dwellings within the surrounding area, which includes double storey development.

...

Due to the generous site frontage and the built form setbacks proposed, ample space is provided for the planting of meaningful vegetation throughout the site; which will make a strong contribution to the preferred character of the area.

The concept design allows for good solar orientation - providing for secluded private open space and primary living areas that face north in each dwelling. This will ensure that sustainability objectives can be met.

Accordingly, the concept plan demonstrates that a two-dwelling development can respond appropriately to the relevant sections of the Municipal Planning Strategy and the Planning Policy Framework.

1. Mr Constantine referred to the construction of two dwellings after the variation of a single-dwelling restriction opposite the subject property at 1 Page Avenue, and opined that this development supports a conclusion that the Boroondara Planning Scheme can foster outcomes for the surrounding neighbourhood that render the single-dwelling restriction 'unnecessarily restrictive and unnecessary'.
2. Finally, Mr Constantine opined that 'the restrictive covenant unnecessarily constrains the development potential of the subject site'.
3. In the addendum, Mr Constantine identified 15 examples of multi-unit developments in the study area. These included two developments in the subdivision (see paragraph 5 of these reasons), one development in LP12282, one in LP12283, three in LP12284, and eight on either Belford Road (a main road) or in streets on the other side of Belford Road from the subdivision.
4. The addendum also stated as follows:

[T]he relevant assessment undertaken in covenant modification applications is a comparison of the benefits originally intended by the restrictions and the extent to which the proposed modification ... would injure any remaining properties.

1. The addendum commented further in relation to the impact of the proposed development under the headings: 'spaciousness/yard area', 'noise' and 'car parking'. Under the heading 'General amenity - spaciousness/yard area', the addendum opined as follows:

Dwelling sizes within the surrounding area vary, and more recent development trends prioritise dwelling footprint over yard space. An inspection of aerial photography reveals that front and rear yards vary substantially in size, much like dwelling footprints. Typically, yard spaces will be smaller in multi-dwelling developments, although this is also often the case in more recent single dwelling constructions where the footprint is particularly generous.

The concept plan depicts two generous dwelling footprints, and provides for private open space areas that exceed minimum planning scheme standards, and allow for the planting of vegetation. Dwelling separation is also achieved. This is generally consistent with the character of the area, and demonstrates that a multi-dwelling development (of at least two dwellings) can accommodate an appropriate amount of yard space that integrates with the existing amenity of the area.

1. In relation to the question of whether the new development was consistent with the character of the area, and whether the modification of the single-dwelling restriction would set a precedent, the addendum opined as follows:

[T]he surrounding area includes several multi dwelling developments of varying age, size and style. This includes two properties that are beneficiaries of the covenant (1 Page Avenue/ 63A Baker Avenue & 1-4/44 White Avenue).

The development at 1 Page Avenue/ 63A Baker Avenue (allowed via previous Supreme Court Order) is located directly opposite the subject site, and demonstrates a comparable outcome, where the land is subdivided into two allotments, and one allotment is access from Page Avenue, and the other from Baker Avenue, effectively creating two separate street frontages and two separate dwelling identities, where no common property is required.

It is noted that there are numerous examples of similar multi-dwelling developments within the surrounding area, but outside of the covenant area, which contribute to the overall character of the locality.

The development at 1-4/44 White Avenue is an older three-storey brick apartment complex, which is bulkier and larger than most buildings in the area. This building represents something of an anomaly in the area, from a neighbourhood character perspective.

Accordingly, it is considered that the proposed covenant variation will not set a new precedence [sic], and would allow for the orderly development of a multi-dwelling development on the subject site.

1. In the Milner report, Mr Milner shared the defendants' concerns about the effect of the development on the character of the neighbourhood and highlighted the risk of incremental multi-unit development if the modification of the single-dwelling restriction was to serve as a precedent for future developments. The Milner report noted that, with two exceptions, the single-dwelling built form and garden character of the 80 lots in the subdivision have been respected and maintained.
2. Mr Milner opined as to the purpose of covenants generally and single-dwelling covenants in particular. Mr Milner said that single dwelling covenants are a bulwark against the 'unattractive consequences' of multiple developments on single lots, noting the purpose of a single dwelling covenant is to preserve the amenity of the neighbourhood.
3. The Milner report concluded as follows:
   • In this matter the large subdivision affected by the single dwelling covenant is essentially intact and the neighbourhood presents as having a special and distinctive garden suburban character in which front and rear gardens, with more substantial trees and vegetation are a major influence. In that context most of the dwellings have an understated presence.
   • Despite progressive redevelopment of old dwellings for new ones, resulting in larger and more dominant forms, the neighbourhood attributes to be protected by the covenant have been maintained.
   • In the one case where the Court has enabled a variation in the covenant affecting LP12281, the outcome has been a development that:
   • diminishes the distinctive, spacious, garden characteristics of the neighbourhood,
   • introduces greater building form, mass and separate buildings, and
   • results in fewer and smaller opportunities for substantive landscape and vegetation.

• detracts from the amenity experienced by adjoining neighbours.

• The conceptual development proposal advanced by the Plaintiff to illustrate the Land's ability to accommodate a second dwelling, serves also to illustrate that the proposal will compound the above negative influences on the neighbourhood character. Further, the conceptual plan would not be referenced in the modification of covenant.
• Approval of the modification should be seen as building a body of precedents, to be relied upon to secure further modifications on other lots within the relevant subdivision.
• Incrementally and cumulatively each precedent contributes to a 'substantial injury', experienced as diminished amenity and ambiance, by beneficiaries in the liveability and character of their neighbourhood.

1. The Milner report observed that the town planning controls referred to in the Constantine report are of limited relevance since that report was prepared prior to the recent introduction of planning scheme amendment VC267.[11] Mr Milner opined that this amendment will render local town planning controls less effective in preserving neighbourhood character if the single-dwelling restriction is modified, and reinforces the importance of the single-dwelling restriction in protecting the character of the neighbourhood.
2. Mr Milner opined that the modification of the single-dwelling restriction upon the subject property will cause substantial injury 'to the beneficiaries of the single-dwelling restriction through the incremental erosion of the character of their intact neighbourhood and consequential loss of amenity for proximate neighbours'. He noted particularly the distinguishing features of the neighbourhood as being:

(a) the regular layout of lots and siting of dwellings;

(b) the presence of single dwellings on all but two lots;

(c) the consistent and generous front dwelling setbacks and the considerable body of trees and vegetation with its screening and softening role;

(d) the spaciousness and depth of rear gardens, with some incorporating swimming pools;

(e) the considerable vegetation in rear gardens and along common boundaries; and

(f) the dominance of single storey inter-war and immediate post-war dwellings as the common housing typology.

1. The Milner report cited the City of Booroondara's 'Neighbourhood Character - Precinct 4 - Precinct Statement' to support this characterisation of the neighbourhood. Mr Milner opined that the proposed development shows a 'lack of respect' for the guidance in this statement.
2. Mr Milner shared the defendants' concerns regarding the precedential effect that the modification of the single-dwelling restriction will have, contending that allowing the variation would make it 'harder to prevent the incremental erosion of the distinctive character of the neighbourhood'. He said that other dwellings built in the subdivision in breach of the covenant have 'not fundamentally diminished [the] remaining value' of the neighbourhood.
3. Commenting on the concept plan, Mr Milner concluded:

[T]he defining characteristic of the neighbourhood that the covenant essentially protected, being an understated balance between a single built form and spacious landscaped front and rear gardens, would be seriously eroded by the dominance and compact grouping of two-storey dwellings and minimal, narrow open spaces.

1. The second Constantine report was prepared by Mr Constantine in response to the Milner report.
2. Mr Constanine emphasised that the present application allows two dwellings to be constructed on the subject property, which he considers 'to be appropriately conservative', given the neighbourhood's character. He also agreed with Mr Milner regarding the purpose of single dwelling covenants, but noted that the subject property is isolated from other beneficiaries, given that it is located in the eastern cluster of the subdivision, and none of the defendants' properties are in the same cluster. Mr Constantine observed further that a single dwelling on the subject property could theoretically have a larger footprint than the two dwellings in the concept plan.
3. Mr Constantine agreed with the statement in the Milner report that recent planning reforms may pose a 'threat to neighbourhood character to varying degrees throughout Melbourne's suburbs' but said that they would be 'of no consequence' to a two-dwelling development built in accordance with the concept plan.
4. Mr Constantine also noted that the concept plan is not inconsistent with the neighbourhood's character, highlighting, among other things:

(a) the presence of large double-storey dwellings in the neighbourhood;

(b) the minimal side setbacks at other properties;

(c) the variation in street setbacks in the neighbourhood; and

(d) reduced yard space being typical in newer developments.

1. As for the precedential issue, Mr Constantine opined that any precedent would be relevant only to similar parcels of land, namely large corner blocks with generous street frontages, and the modification of the single-dwelling restriction therefore would not pose a risk of incremental development as claimed by Mr Milner.

1. In cross-examination, counsel for the defendants queried Mr Constantine as to whether the Constantine report assessed the development proposal against s 84(1)(c) of the Act and the authorities explaining the test for substantial injury. Mr Constantine conceded that he had not, stating that 'perhaps there was some level of ignorance of the [Act]' at the time he prepared the Constantine report, as this was the first time he had prepared a report for the purposes of a proceeding of the current kind before this Court.[12] However, he maintained 'the outcomes... would be the same' if he had undertaken the assessment against the Act.[13]
2. Counsel for the defendants also put to Mr Constantine that his report was prepared by reference to the concept plan. He agreed that the Council could approve a development with greater site coverage and reduced front or rear setbacks[14] 'assuming that [the plaintiffs are] not at maximum percentage'. He accepted that a two dwelling development which was not substantially in accordance with the concept plan could cause the beneficiaries substantial injury.[15]
3. It was also put to Mr Constantine that he has assessed injury in the context of what is permitted under the planning scheme, and he admitted that he had done so 'to a large extent'.[16]
4. Mr Constantine was taken to the list of 15 properties referred to in the addendum that he considered to be the relevant examples of multiple unit development on single lots in the neighbourhood. While he admitted that they have 'little or no relevance for the purposes of the character of [the subdivision]', he maintains that it is 'relevant to look beyond what is a very narrow plan of subdivision'.[17] Mr Constantine opined that, while some of the multi-dwelling lots are not close to the subject property, they remain relevant to the assessment of the character of the area more broadly.
5. Mr Constantine agreed that, when preparing his report regarding the character of the neighbourhood he focused on contemporary developments in the subdivision,[18] which he agreed are the minority of the lots in the subdivision. He accepted that the older houses in the subdivision have consistent front setbacks, but noted that rear setbacks are 'quite varied' depending on whether rear additions, like garages and porches have been constructed.[19] He accepted that the contemporary developments generally maintained a rear setback sufficient to host a backyard and that the concept plan provided for a lesser setback than the other contemporary developments.[20] However, in re-examination, Mr Constantine clarified his comments, saying:

We're noticing trends in recent decades towards larger dwellings, larger building footprints and smaller rear yards. And you also see things like, especially in areas like [the subdivision], you see basements and those sorts of things often incorporated. And what that means is, we get a higher overall site coverage. One thing that's important to understand is that, especially with all these ... Baker Avenue properties, as we've said with not only the contemporaries but other dwellings, there's all sorts of variation with the back yard character, if you like. But when you look from the street, you still see a front garden and then a single or double-storey dwelling. With the contemporary dwellings, it's more likely to be double, that is the trend.[21]

1. Mr Constantine accepted that the subject property was a 'prominent site', partly because it is situated on a rising slope,[22] but said that it will 'not necessarily' have more of an impact than other lots in the subdivision because 'the development of corner allotments is slightly different to what you get on the more standard allotments'.[23]
2. Mr Constantine emphasised that the distinctive attribute of the subject property is its position as a corner allotment, noting that other factors like size and shape are 'secondary and tertiary considerations'.[24] Mr Constantine detailed why each of the other potential candidates for modification (with the exception of 7 Page Avenue, which he accepted is a comparable property) are sufficiently distinguishable from the subject property such that he does not believe modifying the single-dwelling restriction for the subject property would have a precedential effect with respect to the properties identified as comparable lots by the defendants.
3. Mr Constantine rejected the proposition that the smaller size of the lots resulting from the proposed development would be inconsistent with the character of the neighbourhood. Mr Constantine also said that the proposed development would be consistent with the single dwelling presentation of Baker Avenue, given that only one dwelling on the subject property would face Baker Avenue.

1. Mr Milner was asked in the course of cross-examination whether the fenced off part of the subject property on which the garage sits presents as a vacant allotment of land in Baker Avenue. Mr Milner disagreed, saying that it was not a separate lot and that it presents as the back yard of the subject property.[25]
2. It was put to Mr Milner in cross-examination that nothing, in theory, would prevent a single dwelling with a footprint as large or larger than the two dwellings proposed being constructed on the subject property. Mr Milner accepted this was possible, accepting that 'there are a number of things that the covenant doesn't say about [there being] one house on the site'.[26] However, Mr Milner noted that a single dwelling fronting onto Page Avenue would probably have a larger setback.[27] He also gave evidence that a single level dwelling with the same amount of living space as the larger dwelling referred to in the concept plan would have a significantly smaller footprint on the subject property than the proposed development.[28]
3. In cross-examination, Mr Milner distinguished the subject property from the apartments on White Avenue. His evidence was that the surrounds of the apartments, which sit opposite parkland in a peripheral part of the subdivision, as opposed to the subject property which is surrounded by other residences, means that the apartments on White Avenue are less intrusive upon the character of the neighbourhood than they might be if located elsewhere in the subdivision.[29]
4. Counsel for the plaintiffs put to Mr Milner that developments on Page Avenue have no direct effect on the residents at the western end of the subdivision, because they would not notice any development on a day-to-day basis. In response, Mr Milner referred to residents of the neighbourhood 'taking the dog for a walk' and noted that 'if [a pedestrian] was taking [their] dog for a walk down Baker Avenue, [they] may well regularly... pass Page Avenue and experience it as part of the subdivision'.[30]
5. When asked about the importance of rear gardens to the character of the neighbourhood, Mr Milner distinguished between the concept of streetscape, which is the experience of a person walking down the street, and neighbourhood character. Neighbourhood character was 'more encompassing' than streetscape, taking into account back garden character, matching of buildings and large vegetation,[31] noting that streetscape is a 'subset' of neighbourhood character.[32]
6. Mr Milner distinguished between the person walking their dog (see paragraph 72 of these reasons) and a resident of the neighbourhood. Mr Milner conceded that a pedestrian, especially a non-resident pedestrian, may not have as much of a diminished sense of spaciousness caused by the absence of rear setbacks because the buildings may prevent them from seeing into the backyard, and smaller backyards may be able to borrow spaces from other adjacent lots. However, he maintained that the experience of a resident would be different, noting:

[I]f you're the person next door, and you were experiencing this, and you were visiting to the neighbour, for instance, you would experience a diminishing of the sense of open space because, of course, your experience isn't just at one point in time. It's over whatever period you live there or visit, how often you visit. So your sense is one of diminishing the character of the area and the sense of spaciousness.[33]

1. Mr Milner was taken to a number of photographs of properties in the subdivision developed with smaller rear gardens and a resulting lack of vegetation. It was put to him that the restrictive covenant does not protect the maintenance of rear garden space, the post-war style of the dwelling stock and other features common in the subdivision. Mr Milner accepted that the restrictive covenant does not protect these features and cannot control the style of size of the dwellings in the subdivision, which is why there is greater diversity in recent developments in the subdivision.
2. With regards to landscaping and vegetation, Mr Milner said as follows:

The difficulty that arises because of the concept plan... is that because you choose two buildings and you separate the small area, it creates a series of spaces around the sides and backs of both dwellings that are incapable of sustaining significant growth.[34]

1. Mr Milner said further that the proposed development, in his view, would exacerbate the imposition on the spaciousness and vegetation of the subdivision caused by recent contemporary developments more than even a large single dwelling would.[35]
2. In cross-examination, it was put to and largely accepted by Mr Milner that the properties along Page Avenue mirror their opposite numbers on the other side of the road, and therefore that each property would be a precedent for its twin over the road. With respect to the subject property, its twin on the other side of Page Avenue on the corner of Kilby Road has a bus stop in front of it, which may limit the precedential effect of granting the present application to modify the single-dwelling restriction. Mr Milner accepted that the bus stop was a constraint upon the redevelopment of this property with two dwellings, but not a major one, as he believes that the bus stop could be moved if the developer undertook to cover the costs of relocation.[36]
3. While Mr Milner accepted there were differences between the subject property and other sites that have the potential for two dwelling developments in the subdivision, he considered that the proposed development would nonetheless have a precedential effect.
4. In re-examination, Mr Milner opined further that:

I think the precedent that [granting the application] sets is more than one dwelling on a site. It only applies to literally a block that is literally the same size and shape I think is drawing too tight a line, and logically you cross the threshold when you start saying it's all right to have two blocks or two houses on corner sites. Immediately I think all corner sites become candidates, but I think it also has implications for the blocks in between that aren't on corners but are capable of further development.[37]

1. In Randell v Uhl,[38] Derham AsJ summarised the principles governing applications under s 84(1)(c) of the Act, as follows:

(a) a substantial injury must be a detriment to the benefitted land that is real and not fanciful. The requirement that the injury must be substantial is intended 'to preclude vexatious opposition cases where there is no genuineness or sincerity or bona fide opposition on any reasonable grounds'. That does not mean, however, that s 84(1)(c) of the [Act] is restricted to dealing with vexatious or frivolous objections. Although the restriction of s 84(1)(c) of the [Act] to 'substantial' injury would enable the weeding out of vexatious objections to the modification or removal of a covenant, the dichotomy in the section is not between vexatious and non-vexatious claims but is between cases involving some genuinely felt but insubstantial injury, on the one hand, and cases where the injury may truly be described as substantial, on the other;

(b) the substantial injury relates to practical benefits, being any real benefits to the person entitled to the benefit of the covenant. It is not sufficient for a plaintiff to merely prove that there will be no appreciable decrease in the value of the property that has the benefit of the covenant;

(c) substantial injury may arise from the order for modification of the covenant being 'used to support further applications resulting in further encroachment and in the long run the object sought when the covenant was imposed [being] completely defeated'. This consideration is referred to as the 'precedent value'; and

(d) whether there will be substantial injury is to be assessed by comparing:

(i) the benefits initially intended to be conferred and actually conferred by the covenant; and

(ii) the benefits, if any, which would remain after the covenant has been discharged or modified;

(e) if the evidence establishes that the difference between the two will not be substantial, the plaintiff has established a case for the exercise of the Court's discretion under s 84(1)(c) of the [Act];

(f) it is relevant to consider evidence of statutory planning provisions to the extent they show what realistically will be the result of the removal or modification of the covenant because 'it would be artificial and wrong to pay no heed at all to the reality of the situation';

(g) in considering whether the plaintiff has satisfied the Court that there will not be substantial injury:

(i) town planning principles and considerations are not relevant;

(ii) the absence of objectors to the discharge or modification of a covenant will not necessarily satisfy the onus of proof; and

(iii) each case must be decided on its own facts, and each covenant should be construed on its own terms and having regard to the particular context in which it was created;

(h) if the plaintiff satisfies the Court that there will be no substantial injury to the relevant persons, the Court has a residual discretion to refuse the application. The Court in exercising its discretion, may consider town planning principles and the precedent value.[39]

1. In their written outline of submissions, the defendants referred to a number of other principles derived from the authorities in addition to those set out above, largely referring to the reasons of Kyrou J in Vrakas v Registrar of Titles[40] ('Vrakas') and the recent decision of the Court of Appeal in Sumervale Pty Ltd v Viva Energy Refining Pty Ltd ('Sumervale').[41]
2. These include the following propositions:

(a) whether a beneficiary would suffer substantial injury within the meaning of s 84(1)(c) of the Act is a question of fact;[42]

(b) the requirement for an applicant to establish that the beneficiaries will not suffer a substantial injury means that the plaintiffs must in effect prove a negative;[43]

(c) the relevant restriction must be identified and construed, having regard to its purpose, which must be objectively determined;[44]

(d) a 'wide variety of tangible and intangible injuries are encompassed by the expression "substantial injury"', and the injury is not limited to economic loss;[45]

(e) that the character of a neighbourhood may be impaired by a modification may be sufficient to establish substantial injury;[46] and

(f) the beneficiaries of a single-dwelling restriction do not have to own land contiguous to the burdened land to suffer substantial injury.[47]

1. As noted in the summary in Randell v Uhl,[48] town planning principles are generally not relevant to the question of whether the beneficiaries will suffer substantial injury. As noted in the defendants' written submissions, the planning scheme cannot be relied upon to protect the beneficiaries from substantial injury, and 'cannot be regarded as a substitute for the proprietary rights of the defendants pursuant to the restrictive covenant'.[49]
2. However, there are two qualifications to this proposition. First, what is capable of being constructed on the burdened property without the modification or removal of the restrictive covenant is relevant to the assessment of substantial injury. In Oostemeyer v Powell,[50] Riordan J stated as follows (omitting footnotes):

In Prowse v Johnstone, Cavanaugh J considered that, in assessing the benefits actually conferred by the covenant, the Court should have regard to 'the realistic probabilities of the plaintiff actually bringing about the "worst" that could be done under the existing covenant.' His Honour was also prepared to 'assume, without deciding' that in assessing the benefits which would remain, if the covenant is removed or modified, the Court could consider the protections afforded to neighbouring properties by statutory planning provisions. In my opinion, it is relevant to consider evidence of statutory planning provisions to the extent it shows what realistically will be the result of the removal or modification of the covenant because 'it would be artificial and wrong to pay no heed at all to the reality of the situation'.[51]

1. Further, I understand 'town planning principles and considerations' to refer to matters which are commonly prescribed in planning schemes, policies and guidelines, traditionally at a quite granular level, such as car parking requirements, minimum setbacks, density restrictions, overshadowing and overlooking and the like. By way of illustration, if a beneficiary was to object to the modification of a restrictive covenant on the grounds that the covenant prevented the construction of a medical centre in the street, the applicant for modification could not rely upon the fact that such a use was permitted by the local planning scheme in support of a submission that the modification or removal of the covenant concerned would not cause the beneficiary substantial injury.
2. However, as foreshadowed during the hearing of the application, it seems to me that while traditional amenity controls are generally not relevant to the question of whether or not the beneficiaries of a restrictive covenant would or would not suffer substantial injury, the planning context may well be. After all, the single-dwelling restriction was imposed upon the subject property in 1941, which was part of a subdivision registered in 1927. The single-dwelling restriction was imposed in order to, among other things, promote and preserve a particular neighbourhood character in a particular period and context, being a period where there were relatively few limits upon land use and development. This of course changed quite significantly in the latter part of the 20th century, with legislation enacted to give local councils power to, in many cases quite strictly, regulate development in their municipalities.
3. Recently, with the introduction of planning amendment VC267, the planning context in which this application is being considered has changed quite dramatically. Provided that the proposed development satisfies certain minimum standards as to height, setback, and site coverage, the proposed development will be 'deemed to comply'. No beneficiaries of the restrictive covenant (or non-beneficiary residents of the neighbourhood) will be able to object to the grant of a planning permit for the proposed development, and the local council will have no discretion to refuse a planning permit on the grounds that the proposed development is not in keeping with neighbourhood character.
4. Accordingly, consistent with the statement of Cavanough J to the effect that the Court must have regard 'to the reality of the situation',[52] the reality of the situation is that the only bulwark against more intensive, multi-unit development in the subdivision and the broader neighbourhood is the overlapping network of single-dwelling restrictions. In that context, it is difficult not to conclude that the tangible and intangible 'value' of the restrictive covenant over the subject property has materially increased with the introduction of planning amendment VC267. By implication, any modification of the single-dwelling restriction may well impair the 'value' of the restrictive covenant sufficient to amount to substantial injury to the beneficiaries of the restrictive covenant, especially having regard to the precedential effect of any modification.

1. The plaintiffs submitted that the proposed modification of the single-dwelling restriction will not cause substantial injury to the beneficiaries, as the subject property is quite different to the other lots in the subdivision owing to its irregular shape, corner location and large size. The street on which the subject property is located was also said to be unique, with Page Avenue hosting a number of lots with oblique frontages. This is to be contrasted with the other lots in the subdivision which are mostly rectangular lots developed on a grid network. Further, the defendants' properties, with one exception, are located in the western cluster of the subdivision and are not proximate to the subject property.
2. The plaintiffs referred to the decision of Randell v Uhl,[53] where Derham AsJ described the purpose and benefit of a single dwelling covenant as follows (omitting footnotes):

The common single dwelling covenant is imposed for the purpose of ensuring one residence only can be erected on the Land, so that there would be a reasonable density of population giving a reasonably quiet residential atmosphere, attractive in that it would provide a tranquil, quiet existence. The general suggestion is that this living environment would be reduced by higher density housing, leading to a reduction of open space, a greater congestion of people and traffic and an increased demand on municipal amenities. The judgment to be made about 'substantial injury' turns on the nature and degree of the injury to those benefits.[54]

1. While the plaintiffs accept that the proposed development will marginally increase the population density of the neighbourhood, the plaintiffs submitted that there will be no change to the character of the neighbourhood if the single-dwelling restriction is modified to permit the proposed development, emphasising that:

(a) the proposed development is a modest proposal, resulting in only one additional dwelling in the neighbourhood;

(b) the proposed development is 'no more than a minimal change in a neighbourhood full of detached large dwellings of varying sizes, setbacks, site coverage and style', especially in light of recent changes to the neighbourhood by reason of the replacement of older housing stock with more contemporary dwellings;

(c) the subject property's positioning on a corner site allows the construction of a new dwelling which 'replicates the established pattern of detached dwellings with gardens and trees along [Baker Avenue]';

(d) the subject property is unique, in that it:

(i) is not rectangular;

(ii) has two street frontages;

(iii) is significantly larger in area than other lots in the neighbourhood;

(iv) has a generous allotment width; and

(v) is further from most of the regular-shaped lots that 'fix the uniform character of the rest of the [subdivision]';

(e) the proposed development would not detract from the maintenance of the sense of spaciousness and open space in the neighbourhood; and

(f) two comparable sites at 44 White Avenue and 1 Page Avenue already host multiple dwellings without significant injury having been caused to the character of the neighbourhood.

1. The plaintiffs submitted that, insofar as Baker Avenue is concerned, there will be 'no real appreciable difference' to the look and feel of the neighbourhood as it exists now compared to its character in the event the application to vary the single-dwelling restriction is granted,[55] in that the new dwelling on Baker Avenue will not present as a higher density development.
2. As for the proposed dwelling which will front Page Avenue, the plaintiffs said, likewise, that this 'clearly presents as a single dwelling on Page Avenue' and did not, therefore, give the appearance that the neighbourhood was one of higher density development.[56]
3. As for the spaciousness of the neighbourhood, the plaintiffs submitted that the relevant feature of the neighbourhood was the deep front setbacks rather than the backyards, which are generally not visible from the street. The plaintiffs submitted that the subject property can 'borrow' from the substantial open space on the abutting property at 4 Page Avenue.[57] In any event, the plaintiffs noted there has been a progressive reduction in backyard space in the neighbourhood owing to the replacement of the original housing stock with larger contemporary dwellings.
4. Additionally, the plaintiffs contend there will be no precedential impact of the proposed modification of the single-dwelling restriction owing to the subject property's unique characteristics. The only two similar lots are the lots at 44 White Avenue, which has already been developed with four apartments, and is, like the subject property, located on the periphery of the subdivision, thus minimising its effect on the character of the neighbourhood. Further, while 7 Page Avenue is substantially similar to the subject property, it is on the corner of Kilby Road, an important road, and has a bus stop out the front, which may impede its redevelopment.
5. Accordingly, the plaintiffs submitted that the precedential effect would, practically speaking, be limited to one property and 'that [the granting of the application] would not have a creeping effect across the whole neighbourhood'.[58] The plaintiffs rejected the contention that the modification of the single-dwelling restriction would have a precedential effect for any lot other than 7 Page Avenue, noting that the other lots said by the defendants to be comparable lots are 'within the heart of the subdivision'.[59]
6. The plaintiffs submitted that Mr Constantine's evidence regarding the evolution of the neighbourhood should be accepted over Mr Milner's evidence to the extent of any inconsistency. In particular, Mr Constantine's evidence to the effect that the neighbourhood has evolved over time and now hosts houses of varying sizes, setbacks, site coverage and style, while retaining a detached, garden, suburban character should be accepted. Accordingly, there will be, at most, a minimal change resulting from a two-dwelling development with a maximum height of two-storeys.
7. As for the defendants' criticism of Mr Constantine's evidence, the plaintiffs submitted that the question of serious injury is to be answered by the Court, not the experts. Therefore, Mr Constantine's failure to set out the relevant test in his reports does not diminish the value of his evidence.
8. The plaintiffs submitted, in conclusion, that there will be 'no compromise to the existing benefits conferred on beneficiaries by the covenant by allowing two dwellings on the subject [property]'.
9. As for the residual discretion, the plaintiffs emphasised that the purpose of the residual discretion is 'simply to make the point that the [C]ourt's not bound just because it finds that the threshold tests are met'.[60] The plaintiffs noted that the recent planning reforms are relevant only to the exercise of the Court's residual discretion under s 84(1) of the Act. However, counsel for the plaintiffs stressed that the changed context arising due to planning scheme amendment VC267 does not mean 'that the decision for the court is any different, or the court can be moved or should be moved by any greater favouritism towards one outcome over the other'.[61]

1. The defendants submitted that the proposed modification of the single-dwelling restriction will cause substantial injury to them and other beneficiaries of the restrictive covenant. The defendants submitted that the relevant injury to the beneficiaries arises from two related matters: first, the effect of the modification of the restrictive covenant on the character of the neighbourhood, and secondly, the precedential effect.
2. The defendants submitted that the relevant neighbourhood for the purposes of determining neighbourhood character is the subdivision, 'not the much wider neighbourhood considered by Mr Constantine'.[62] They submitted further that the subject property's irregular shape is not unique, nor is its size, with there being 13 lots of a similar size to the subject property in the subdivision.
3. The defendants submitted that the subdivision has a remarkably consistent single dwelling character. This has enabled the neighbourhood to be 'low density with a garden suburban character and a sense of spaciousness, with plenty of space to plant trees and for gardens around dwellings'. The Milner report demonstrated that the covenants have facilitated the 'creation of low-density housing and a spacious and aesthetic environment', which contemporary developments have respected. This confers a 'substantial benefit' upon the beneficiaries of the restrictive covenant.
4. The defendants submitted that the opinion of Mr Milner that the proposed development would cause substantial injury should be accepted. The defendants referred to Mr Constantine's analysis as being flawed for having been, among other things, undertaken 'through the lens of what is permitted under the Planning and Environment Act [1987 (Vic) and] the Boroondara Planning Scheme', and not under the Act. Accordingly, Mr Milner's evidence should be preferred to that of Mr Constantine. [63]
5. The defendants submitted that, in any event, Mr Constantine in effect conceded that the beneficiaries would suffer substantial injury if the single-dwelling restriction was modified.[64] Counsel for the defendants noted, for example, that Mr Constantine agreed that a development with reduced setbacks could cause a significant injury[65] and conceded, despite his emphasis on the contemporary development that has taken place in the neighbourhood, that the single-dwelling restriction 'continues to provide nobler character benefits' and that 'those benefits still continue to be provided'.[66]
6. The defendants acknowledged that the plaintiffs have provided a concept plan and have offered an undertaking to carry out the development generally in accordance with the concept plan. However, the defendants submitted that the concept plan would not bind the plaintiffs' successors in title, which makes it difficult for the Court to be satisfied that there will be no substantial injury to the beneficiaries of the single-dwelling restriction. In any event, the defendants submitted that the proposed development will cause the beneficiaries substantial injury.
7. The defendants submitted that substantial injury is demonstrated by the number of defendants to the proceeding. Additionally, the fact that the owners of the adjoining properties do not oppose the application, while unusual, does not support a conclusion that granting the plaintiffs' application would not cause the beneficiaries of the restrictive covenant substantial injury. This is especially so given the nature of the injury alleged, which is said to be a change to the character of the neighbourhood, as the effect of the proposed development will be felt regardless of whether the beneficiaries' properties are contiguous with or proximate to the subject property.
8. The defendants relied upon the decision of Macaulay J in Hivance[67] 'as an example of an instance where... defendant beneficiaries were not immediately abutting' but where the proposed modification to a restrictive covenant was found to cause substantial injury by reason of the effect on neighbourhood character.[68]
9. The defendants, again relying on the evidence of Mr Milner, submitted that two dwellings would 'without doubt' have greater site coverage than one dwelling on the lot.[69] Assuming that the subject property is divided evenly, the two properties will be the second and third smallest lots in the subdivision, with only 63A Baker Avenue being smaller in size. This, the defendants submitted, would detract from the low density garden suburb character of the neighbourhood.
10. The defendants submitted that the modification of the single-dwelling restriction would create a precedent for any further applications in the neighbourhood, as the subject property is not unique. Importantly:

(a) there are multiple irregular lots in the subdivision;

(b) there are several corner lots; and

(c) there are at least 13 lots of a similar or larger size to the subject property.

1. The defendants rejected the plaintiffs' approach to the potential precedential impact of the current application as being 'unduly narrow'.[70] Instead, the defendants identified 7 Page Avenue and 8 Page Avenue as being very similar to the subject property, such that the prospects of success of any application to modify the covenants affecting those properties would be enhanced should the plaintiffs' application succeed. The defendants submitted that, should those properties in turn be developed with two dwellings, the prospects of success of any further applications to vary the single-dwelling restriction burdening other lots in the subdivision would also be enhanced.
2. The defendants acknowledged that there are two lots in the subdivision with multiple dwellings. However, these are 'the exception and not the norm', noting further that the property at 1 Page Avenue retains the original dwelling, while the concept plan does not. The defendants referred to Mr Milner's evidence that the dwelling constructed after the subdivision of 1 Page Avenue was 'notable for its variation from the defining attributes' of the neighbourhood.
3. The defendants also noted that planning scheme amendment VC267 limits the ability of the local council to exercise control over any development of the subject property.[71] This 'elevates the importance of covenants and the value they provide'[72] to the maintenance of the character of the neighbourhood.

1. As indicated earlier in these reasons, I am not satisfied that the modification of the single-dwelling restriction to permit the proposed development will not cause the beneficiaries of the single-dwelling restriction substantial injury.
2. First, I accept the defendants' submission that the proposed development will of itself detract from the garden suburb character of the neighbourhood. Secondly, I accept that the defendants' submissions that the proposed modification will have a precedential effect which will lead to, using the language of Macaulay J in Hivance:[73]

...an escalation of [multi-dwelling lots] replacing single dwellings and thus contributed to a longer-term change to the attributes of the area that are desirable and attractive to the residents in general and beneficiaries of the covenant in particular.[74]

1. I reach these conclusions having regard to the evidence of the defendants, the expert evidence, my own observations of the neighbourhood, and my analysis of the properties in the subdivision. I generally prefer the evidence of Mr Milner over the evidence of Mr Constantine. He was clearly familiar with the test to be applied in applications of the current kind, and his opinion regarding the impact of the proposed development upon the character of the neighbourhood and the precedential effect of the modification of the single-dwelling was unshaken by cross-examination. His explanation of why the assessment of the impact of the proposed development upon the character of the neighbourhood should not be limited to simply an assessment of the impact of the proposed development upon the streetscape of the neighbourhood was helpful and convincing.
2. Turning first to the impact of the proposed development on the character of the neighbourhood, there is no real dispute between the parties regarding the purpose of the single-dwelling restriction, or the contribution that almost universal compliance with the single-dwelling restriction has made to the evolution and maintenance of the character of the neighbourhood. The neighbourhood presents as a tranquil, spacious, moderately vegetated neighbourhood with a generally, if not completely, harmonious character in terms of lot size and architectural style. I accept that the progressive development of larger, more contemporary dwellings with larger site footprints has, to some extent, disturbed the prevailing neighbourhood character, but such developments are, at least currently, in the minority, and many of the more recent developments retain the generous setbacks characteristic of the neighbourhood. Further, in many cases, the contemporary developments include soft landscaping, which will mature over time and therefore contribute to the garden suburb character of the neighbourhood in due course.
3. Where the parties differ is regarding the impact of the proposed development on the character of the neighbourhood. The plaintiffs say that the proposed development will add only one household to the neighbourhood, and, given the size of the subject property and its location on a corner lot with two street frontages, the proposed development will present as two separate single dwellings similar to other contemporary homes in the neighbourhood, with comparable setbacks.
4. The defendants say, in response, that the substantial footprint of the two dwellings, being over 100 square metres greater than one might expect even a very large single-storey dwelling to cover, and the very modest setbacks at the rear, means that the proposed development will be substantially out of keeping with the character of the neighbourhood.
5. I agree. In particular, I agree with the observations of Mr Milner to the effect that it is not only the front yards of the properties in the subdivision that contribute to the green, spacious character of the neighbourhood. It was apparent from my walk around the neighbourhood on 30 November 2025 that the large canopy trees and other vegetation in rear yards contribute to both the visual attractiveness and general ambience of the neighbourhood. Further, I also agree that what is visible from the street does not represent the whole experience of the neighbourhood for residents. Residents of the neighbourhood experience the built form and vegetation of other properties in the neighbourhood not only from the street and their front yards, but also from their homes and backyards.
6. Currently, most residents of the neighbourhood would enjoy the sense of greenery and spaciousness of the neighbourhood from the windows of their homes and their outdoor living areas, with only some properties being encroached upon by buildings with large footprints. In contrast, the concept plan allows only limited space for the establishment and growth of vegetation, noting that a substantial part of the open space at the front of the proposed dwellings will be consumed by driveways, and almost no allowance is made for open space at the rear of the dwellings. It is correct to say that in some respects, the proposed development is not very different in presentation than some of the more recent developments in the neighbourhood. But an examination of the aerial photographs in evidence shows that there are some, but only a handful of properties in the subdivision which have rear setbacks of only three to five metres.
7. Further, it is apparent from my inspections of the neighbourhood that the subject property is a prominent site in the neighbourhood, by reason of its size, its position on a corner lot, and by reason of the topography of the neighbourhood. The proposed development will therefore be particularly imposing, and have a visual impact upon those travelling along Baker Avenue in particular which would be out of all proportion to its status of being merely one lot amongst 80 in the subdivision.
8. Accordingly, I am not satisfied that the proposed development would not of itself cause substantial injury to the beneficiaries of the single-dwelling restriction. I agree that, given the compact size and general cohesiveness of the neighbourhood, the fact that the defendants' properties are not particularly proximate to the subject property does not necessarily limit the impact of the proposed development upon their enjoyment of the amenity of the neighbourhood.
9. However, it seems to me that the most significant matter contributing to any substantial injury to the beneficiaries of the single-dwelling restriction is the precedential effect of any modification of the single-dwelling restriction. I agree with the defendants that the plaintiffs' submissions take an unduly narrow view of what lots in the subdivision are comparable to the subject property for the purpose of evaluating the potential precedential effect of the modification of the single-dwelling restriction. Indeed, I would go further than the defendants, and say that the precedential effect of any modification of the single-dwelling restriction may very well carry across to the south side of Baker Avenue. Any more intensive development of larger lots on that side of the street also has the capacity to cause substantial injury to the beneficiaries, despite the south side of Baker Avenue being located in a different subdivision.
10. The plaintiffs concede that 7 Page Avenue is comparable to the subject property, being in effect the 'mirror lot' to the subject property. However, they noted the presence of a bus stop in front of this lot as being a significant impediment to the redevelopment of this lot with dwellings upon two separate street frontages. The plaintiffs also seem to concede that the proposed development may also set a precedent for a two-dwelling redevelopment of 8 Page Avenue, which is the 'mirror lot' of the redeveloped lot at 1 Page Avenue.
11. However, as shown by the plan in the schedule to these reasons (see also paragraph 32 of these reasons), the defendants have identified 12 lots in the subdivision which have features comparable to the subject property, excluding for present purposes the lot at 44 White Street, which has already been redeveloped with four dwellings in apparent breach of the single-dwelling restriction. These lots have been identified as comparable lots by reason of their larger than average size, their irregular dimensions, and/or their location on a corner block with potential for two street frontages.
12. Of the 12 lots identified by the defendants, I consider that eight lots are potentially candidates for applications for the modification of the single-dwelling restrictions over their properties should the plaintiffs' application in this proceeding be granted. These include the properties at 3, 4, 5, 6, 7 and 8 Page Avenue and the properties at 38 and 40 White Avenue.
13. The properties at 3, 4, 5 and 6 Page Avenue and 40 White Avenue are not located on corner blocks, but have street frontages in excess of 80 feet (24.384 square metres), which would, if subdivided, enable street frontages of more than 80 percent of the standard street frontage in the subdivision of 50 feet (15.24 square metres). Accordingly, I have excluded 42 White Avenue and 31 and 33 Baker Avenue as being comparable to the subject property, as they have insufficiently wide street frontages. I also accept the evidence of both town planners that the kite shaped property at 6 Kilby Road would be difficult to develop with two detached dwellings given its configuration.
14. Currently, only 2 of the 80 lots in the subdivision are developed with more than one dwelling, which represents 2.5 percent of the lots in the subdivision. Accordingly, there are now 84 dwellings in the subdivision. If the subject lot and the eight other lots identified above are redeveloped with two dwellings, the total number of dwellings in the subdivision will rise to 93 dwellings, and the proportion of the lots in the subdivision developed with two or more dwellings will climb from 2.5 percent to 13.75 percent. That is, a tiny minority will become a significant minority. While this would not amount to a wholesale redevelopment of the neighbourhood, it would be a material increase which would have a visible impact upon the neighbourhood, noting that all the properties in Page Avenue would be candidates for redevelopment.
15. If I am wrong and the defendants are correct about the properties at 42 White Avenue, 6 Kilby Road, and 31 and 33 Baker Avenue as being candidates for redevelopment should the single-dwelling restriction on the subject property be modified to allow the proposed development, the number of dwellings in the subdivision would rise to 97 dwellings, and the proportion of lots developed with two dwellings would climb to 18.75 percent.
16. Further, as indicated earlier in these reasons, I see no reason to discount the precedential effect of the modification of the single-dwelling restriction upon the lots on the southern side of Baker Avenue as potential candidates for redevelopment. While the properties on the south side of Baker Avenue are in a different subdivision (LP12282), they are undoubtedly part of the neighbourhood. Indeed, given the fall of the land towards the north, these properties visually dominate the Baker Avenue streetscape, and it is the part of the neighbourhood where recent contemporary developments are particularly imposing.
17. None of the 33 properties along the south side of Baker Avenue [75] are developed with two dwellings, and the best available evidence suggests that they are all burdened by single-dwelling restrictions. However, of these properties, four would be considered by the defendants to be candidates for redevelopment should the application for modification be granted (32 White Avenue, 30 Baker Avenue, and 32 and 33 Mathers Avenue).
18. 32 White Avenue is a mirror lot to 44 White Avenue in the subdivision, which is already redeveloped with four dwellings, while 32 and 33 Mathers Avenue are also potential candidates for redevelopment, being large lots with two street frontages. 30 Baker Avenue is a mirror lot to the kite shaped lot at 6 Kilby Road, which I have excluded as a potential candidate, at least for present purposes.
19. Accordingly, if the plaintiffs' application is granted, this could also set a precedent for any application for modification of three further properties either fronting or abutting the south side of Baker Avenue. While these properties are not located in the subdivision, any redevelopment of these properties with two dwellings would adversely affect the character of the neighbourhood experienced by the beneficiaries, particularly given the visual prominence of properties on the high side of Baker Avenue.[76]
20. Accordingly, the precedential effect of the modification of the single-dwelling restriction over the subject property would be significant. I agree with Mr Milner's opinion that granting the plaintiffs' application '...would have longer term, detrimental consequences, making it harder to prevent the incremental erosion of the distinctive character of the neighbourhood'.
21. Further, as discussed earlier in these reasons, while planning guidelines and considerations are not relevant to the question of whether the beneficiaries of the single-dwelling covenant would suffer substantial injury if the restriction were modified, the planning context may well be. Prior to the enactment of planning amendment VC267, the objection process and the local council's residual discretion to reject an application for a planning permit on the grounds of impairment of neighbourhood character provided an additional potential remedy to any person, including the beneficiaries of a restrictive covenant, aggrieved by a proposed development permitted by the removal or modification of a restrictive covenant.
22. However, that remedy is no longer available to the beneficiaries. I agree with the submissions of the defendant to the effect that the changed planning context highlights and enhances the value of the single-dwelling restriction. As a matter of logic, making an order which diminishes or removes that restriction, in circumstances where no other remedy is now available to the beneficiaries by reason of changes to the planning framework, must of itself amount to substantial injury.
23. Accordingly, I am not satisfied that the proposed modification of the restrictive covenant will not cause the beneficiaries substantial injury. I will dismiss the plaintiffs' application, and hear further from counsel on the question of costs.

[1] It is generally not my policy to include the residential addresses of parties in published judgments, but in the current context, it is unavoidable.

[2] While there is no direct evidence to this effect, it seems to be common ground that each of the properties in the subdivision are burdened by restrictive covenants imposing single-dwelling restrictions, with the identity of the beneficiaries for each of the burdened properties varying according to the date the burdened properties were transferred out of the parent title. It seems that the same applies to the subdivision created by LP12282 as well, and quite possibly the remaining subdivisions shown in Figure 1.

[3] There is also a limitation upon the extent of excavation which can be carried out on the subject land, which the plaintiffs also wish to modify, but that is not controversial for present purposes.

[4] Order of Zammit AsJ in Re Demian (Supreme Court of Victoria, S CI 2010 2601, 19 July 2010).

[5] Orders were made for the advertisement of the application in accordance with the usual practice at the time, by giving direct notice to the registered proprietors of adjoining properties and by the publication of notices in metropolitan and local newspapers, but did not require direct notification of all beneficiaries or the erection of a large sign on the property, as is the common practice today.

[6] Confirmed by an undertaking proffered by the plaintiffs' counsel at trial: see T163 L16-T164 L3.

[7] At this time the precise boundaries of the neighbourhood and whether there was any dispute about the precise area of the neighbourhood was not entirely clear.

[8] Based upon the contemporaneous notes I made during the course of the visit.

[9] The Constantine report does not define the relevant neighbourhood for the purpose of assessing substantial injury, but in the addendum, Mr Constantine referred to the 'study area' as being the area bounded by Kilby Road to the north, White Avenue to the west, Beresford Street to the south, and Windella Avenue (which is outside the boundaries of the aerial photograph in Figure 1) to the east.

[10] However, an examination of the concept plan shows that the subject property may not be divided equally between the two dwellings. While the exact measurements of the two lots (assuming the proposed development will involve the subdivision of the subject property) are not readily discernible from the concept plan, the area of the lot facing Page Avenue seems somewhat larger than the area of the lot facing Page Street. If the ratio is closer to 60:40 than 50:50, then the Page Avenue lot will have an area of about 555 square metres, and the Baker Avenue lot an area of approximately 370 square metres.

[11] The planning scheme amendment VC267 came into effect on 31 March 2025, and provides that developments of two or more dwellings up to three storeys in scale will be 'deemed to comply' if certain minimum standards are met.

[38] [2019] VSC 668. Approved and applied by Macaulay J in Hivance Pty Ltd v Moscatiello [2020] VSC 183 [12] ('Hivance').

[39] Randell v Uhl [2019] VSC 668, [85].

[40] [2008] VSC 281.

[41] [2024] VSCA 140.

[42] Re Alexandra [1980] VicRp 7; [1980] VR 55, 60.

[43] Vrakas [2008] VSC 281, [42].

[44] Sumervale [2024] VSCA 140, [54].

[46] Vrakas [2008] VSC 281, [63].

[48] [2019] VSC 668, [85].

[49] Prowse v Johnstone [2012] VSC 4, [118].

[50] [2016] VSC 491.

[52] Prowse v Johnstone [2012] VSC 4 [104].

[53] [2019] VSC 668.

[62] T170 L3-L4. Both parties accept that the relevant neighbourhood is the subdivision plus the south side of Baker Avenue: see T223 L31.

[67] [2020] VSC 183.

[73] [2020] VSC 183.

[75] Excluding a property in LP12282 which fronts Belford Road, but has a 39.6 metre boundary along Baker Avenue. I have excluded this property from the analysis given the smaller size of this lot.

[76] Arguably, I have taken a conservative view, given that the properties at 30 and 31 Mathers Avenue and 30 White Avenue are proximate to Baker Avenue, and would also meet the criteria to be candidates for redevelopment.