Victorian Civil and Administrative Tribunal|2008-07-21

Shimmerbridge Pty Ltd v Bayside CC (includes Summary) (Red Dot) [2008] VCAT 1428 (21 July 2008)

The practice of VCAT is to designate cases of interest as 'Red Dot Decisions'. A summary is published and the reasons why the decision is of interest or significance are identified. The full text of the decision follows. This Red Dot Summary does not form part of the decision or reasons for decision.

Whether Beaumaris Hotel is in a strip shopping centre and gaming machines are prohibited

PLANNING SCHEME - interpretation or consideration of VPP provision

Clause 52.28-4 - Prohibition of a gaming machine in a strip shopping centre

ANALYSIS - exposition of how to asses an issue or matters to consider

Analysis of what constitutes a strip shopping centre

CHANGE TO LEGISLATION OR VPPS - whether change to VPPs or statutory provisions is required or desirable

The Responsible Authority could amend the Schedule to clause 52.28-4 to exclude the Beaumaris Hotel from the Keys Street strip shopping centre.

Pursuant to VPP clause 52.28-4, gaming machines are prohibited in strip shopping centres, which centres must meet four criteria. The declaration asked whether the Keys Road Beaumaris shopping centre is 'an area in which a significant proportion of the buildings are shops'. There was no real debate that the Beaumaris Pavilion Hotel was within the shopping area. I answered four questions.

Firstly, does 'buildings are shops' mean buildings designed and constructed to look like shops or buildings used as shops, i.e. their physical appearance as opposed to their actual use? I did not limit the declaration to physical criterion alone, but found that new redevelopments of old shops still kept the fine grain traditional format with single fronted shop window at ground level.

Secondly, does 'shops' mean the narrow definition of shops in clause 74 or a broader sense, applying the natural or ordinary English meaning of the word? I held that the natural or ordinary English meaning of the word 'shop' should be applied rather than the narrow cl. 74 definition which would exclude premises normally understood to be shops (e.g. take away food shops and cafes).

Thirdly, to what extent do statistics on pedestrian activity influence whether a business centre is still considered a 'strip shopping centre'? A comparison with the neighbouring Concourse 'neighbourhood activity centre' revealed that it is visited ten times more than Keys Street. I found that Keys Road, also identified as a neighbourhood activity centre within the planning scheme, reveals a prima facie inference that this shopping centre is indeed a strip shopping centre.

Fourthly, do a 'significant' proportion of shops still remain in the centre?

The answer to the last two questions is a matter of fact and degree in each case. Following Crestline[1] and Whelan[2], I found that the fact that it operates as a lower order shopping centre than others within Bayside, as evidenced by its pedestrian traffic, has not changed its character as a strip shopping centre yet. Many of the attributes of this lower order centre can be found in many other strip shopping centres in Victoria. When centres lose their previous daily shopping needs function, they may reinvent themselves to serve a different purpose.

I found that it is an area in which 'a significant proportion of the buildings are shops' because a significant proportion of the buildings are constructed as shops, including much new construction; the overall mix of uses is one often found in a strip shopping centre and enough of the buildings are also used as shops applying the ordinary or natural English meaning of the word.

Planning and Environment; Gaming machines; clause 52.28-4; Gaming machines prohibited in strip shopping centres; whether lower order shopping centre zoned Business 1 is a strip shopping centre.

Shimmerbridge Pty Ltd v Bayside CC (includes Summary) (Red Dot) [2008] VCAT 1428

Pursuant to the Planning and Environment Act section 149A, I declare that the Beaumaris Pavilion Hotel lies within the Keys Road shopping centre, which is a strip shopping centre within the meaning of clause 52.28-4 of the Bayside Planning Scheme.

Ms Susan Brennan of counsel, instructed by Bazzani Scully Brand, Lawyers. Ms Brennan called Ms Jordan, Planning Consultant and Mr Shimmin, Economist of Urbis to give evidence.

Becton Corporation (through Shimmerbridge Pty Ltd) has bought the Beaumaris Pavilion Hotel. It seeks an arrangement with the Beaumaris RSL whereby the latter will relocate its club with thirty gaming machines to the Beaumaris Hotel and Shimmerbridge will develop the RSL club site with residential dwellings. The Beaumaris RSL lies in a Residential 1 zone in Balcombe Road.
The RSL cannot enter into this arrangement if it is prohibited in law to place gaming machines into the Beaumaris Hotel. Pursuant to the Bayside Planning scheme clause 52.28-4, installation or use of a gaming machine is prohibited in a strip shopping centre if the strip shopping centre is specified in the schedule to clause 52.28-4, or the schedule provides that a gaming machine is prohibited in all strip shopping centres on land covered by the Bayside planning scheme. (Tribunal emphasis)
The responsible authority has not differentiated between strip shopping centres within its municipality where use of a gaming machine is prohibited. Rather the schedule to clause 52.28 prohibits gaming machines in all strip shopping centres in Bayside[3].
Shimmerbridge has lodged this section 149A[4] application so the Tribunal can determine whether clause 52.28 would prohibit gaming machines on the subject land. The sole issue in this case is whether the Keys Street shopping centre is a strip shopping centre. A related issue was whether the Beaumaris Pavilion Hotel was a part of that shopping centre, but this was not really disputed.

Both parties agree the Tribunal has jurisdiction to make such a determination because, as will be seen, council cannot give Becton a definitive answer on the point, so there is a real question of interpretation to be tried.
Council's position was set out in a letter to the applicant in January this year:

Council's Solicitors have reviewed the material provided and agree that the Hotel is part of the Key Street Local Centre. They also concur with the advice of Ms. Brennan that it is not possible to be definitive about whether the Hotel is in a strip shopping centre and, in turn, whether the installation and use of gaming machines is prohibited.

It would appear that the Keys Street local centre is not an area in which a "significant" proportion of the buildings are shops since the proportion of buildings in the area which are shops is not significant having regard to the underlying policy objective. This opinion is based on the general principles that emerged from the findings of the then President, Justice Morris in the Romsey decision (Romsey Hotel Pty Ltd v The Victorian Commission for Gambling Regulation [2007] VCAT 1), which is presently under appeal. The outcome of the appeal of the Romsey decision may necessitate amendment of this position.

After that letter, the Supreme Court of Appeal overturned the decision of Justice Morris in Romsey Hotel PL v Victorian Commission for Gambling Regulation[5] saying:

Since the purported decisions of the Tribunal on those questions were outside the Tribunal's jurisdiction, they have no legal validity at all.

This conclusion, though inescapable, is in some ways regrettable. The Tribunal gave detailed consideration to the planning questions and it would no doubt have been of assistance to those practising in the planning field had this Court been able to express views as to the correctness (or otherwise) of what his Honour said. But for the reasons given, we are simply unable to do so.

In the circumstances, it is important to emphasise that the answers which his Honour purported to give to the planning questions have no legal validity and should be disregarded. They have no force, persuasive or otherwise, in the planning jurisdiction. How the "strip shopping centre" definition is to be interpreted and applied must await a suitable case raising that issue for consideration.

Given that the basis on which council responded in the affirmative in January 2008 relies on a decision overruled by the Court of Appeal, there is a real question of interpretation.

This section 149A application for declaration was not publicly advertised by council pursuant to section 52 of the Act. Mr Clarke Martin, a member of CHEERS[6], asked to make a submission in support of the RSL's desired move into the Beaumaris Pavilion Hotel, to breathe social and economic life and purpose to the Hotel.
I did not grant him leave to make a submission because he could not contribute to the question of mixed fact and law, which is the sole reason for this application. Merits submissions have to await another time if gaming machines are permissible.

The subject land is zoned Business 1 under the Bayside Planning Scheme. One of the purposes of clause 52.28 is to prohibit gaming machines in specified shopping complexes and strip shopping centres, while the other two consider the merits of the chosen location.
Clause 52.28-4 describes strip shopping centres as an area that meets all of the following requirements:
- it is zoned for business use;
- it consists of at least two separate buildings on at least two separate and adjoining lots;
- it is an area in which a significant proportion of the buildings are shops;
- it is an area in which a significant proportion of the lots abut a road accessible to the public generally.
Both parties agree that attributes one, two and four apply to Keys Street shopping centre.

The sole issue is whether Keys Street is an area in which a significant proportion of the buildings are shops. This raised the following five sub-issues.
Firstly debate centred on whether 'buildings are shops' meant buildings designed and constructed to look like shops or buildings used as shops, ie their physical appearance as opposed to their actual use.
Secondly, debate centred on whether 'shops' meant shops as narrowly defined in clause 74 of the planning scheme or in a broader sense, applying the natural or ordinary English meaning of the word.
Thirdly, debate centred on the extent to which statistics on pedestrian activity influenced whether a business centre is still considered a 'strip shopping centre'.
Fourthly, reference was made to the word 'area', but without real debate that the Hotel was within the shopping area.
And finally debate centred on whether a 'significant' proportion of shops still remained in the centre.

The whole of the centre is zoned Business 1, including a large car park at the corner of Tramway Parade and Keys Street and one attached to and behind the Beaumaris Pavilion Hotel.
In Keys Road there are quite a few new redevelopments of old shops. Despite this built form renewal, and as confirmed by Ms Jordan, most still keep to the fine grain traditional format with single fronted shop window at ground level and residential at first floor level, although some are used as offices at ground level.

Ms Jordan, planning consultant, analysed the built form nature and land use content of the Keys Road shopping centre. She concludes that this centre is characterised by a range of professional offices, medical centre, restaurants, cafes and other service related facilities, with few retail uses servicing the daily needs of the local community.
I have analysed her evidence and that of Mr Shimmin. I have not adopted their underlying classification of shop for reasons I explain later in my analysis. Out of 25 commercial[7] premises besides the Hotel, six are vacant, eight would commonly be considered a shop applying the natural or ordinary English meaning of the word, three are restaurants/take away and eight are offices. Out of three restaurants identified by Ms Jordan, at least two include a substantial takeaway food component, which would also commonly be considered a shop applying the natural or ordinary English meaning of the word, and were so considered in Crestline[8]. Two of these 'offices' include uses such as medical and physiotherapy. Other offices include mortgage broker, insurance broker, accountant, financial adviser, photographer, and media production.
Therefore premises that are used as shops applying the natural or ordinary English meaning of the word, constitute thirty-eight per cent of this centre until the other seven premises are let. As Ms Jordan acknowledges, they could be let for a shop, food and drink premises or an office.
As for the remaining office uses, these are a mix of uses also commonly found in any shopping centre, following Member Rickards in Whelan.

Mr Shimmin who specialises in property economics and market research, surveyed, analysed and compared the pedestrian activity in this centre with that of The Concourse shopping centre in Beaumaris.
I do not think this compares apples with apples, because the Concourse occupies a larger area, which boasts a critical mass of shops able to service daily needs. Quite a proportion of the Keys Street shopping centre is occupied by the Hotel and car parking. However, the northern corner of Keys Street with Beach Road in the BI zone has already been converted to residential apartments.
Mr Shimmin applied a pedestrian traffic test to assess whether this could be considered a strip shopping centre. Because pedestrian levels are 'extremely low', he concludes that it should not be so characterised.
Because not all points of the larger Concourse shopping centre were captured in the survey, Mr Shimmin extrapolates that total weekly pedestrian traffic in the Concourse would be 26,000 persons, as against below 2,500 for Keys Street. The Concourse is visited ten times more than Keys Street.
Mr Shimmin concludes:
- Pedestrian traffic surveys in Keys Street reveal a total of 2,434 patrons during a full trading week, 34% of whom visited on the weekend. Average daily traffic flow, therefore, was 348 people per day or 35 people per hour although on weekends the average footfall is 483 per day or 48 people per hour, with a high proportion after 5:45pm (i.e. 27%).
- 63% of weekend patrons visited Keys Street mainly to go to the milk bar, with a further 14% visiting mainly to go to a restaurant or get take-away food. Almost 10% visited mainly to go to the bakery, only to find it closed.
- A further 16% suggested that their main purpose was to visit non-food retail stores (5%) and retail service establishments (11%) such as hairdressers and the like.
- The further 12% were pursuing business services or medical services during their visit.
- Customer surveys undertaken in Keys Street over a full trading week reveal that approximately 50% of Keys Street customers are regular users, albeit for a specific purpose such as to visit the milk bar, beauty salon or a café/restaurant.
- This customer research has shown that more than 50% of respondents indicated that their main purpose of visiting Keys Street was to go to the milk bar. In contrast, the Beaumaris Concourse exhibits quite a different usage pattern. Almost three quarters of customers visit the Concourse to, amongst other things, buy groceries and to pursue convenience shopping, including visiting the local IGA supermarket. This type of purpose is a regular weekly shopping task and is quite different from visiting a milk bar.
- The role and function of the Beaumaris Concourse Centre is significantly different from the role and function of Keys Street, with the Concourse being used on a regular basis for weekly shopping needs and for the various food and drink premises, as well as for business and medical services. Keys Street, on the other hand, performs a top-up function as far as the retail activities are concerned, with the milk bar being the stand out main reason for visiting the precinct.
- Keys Street performs a relatively minor role as a "shopping centre", with customers predominantly using it when needing to visit the local milk bar, or alternatively when choosing certain destination uses such as a restaurant, medical centre or beautician.
- On the basis of this analysis, and in comparison with one of the main local shopping centres in the area, namely the Concourse in Beaumaris, pedestrian levels in Keys Street are aptly described as extremely low.

Mr Shimmin continues:
- 78% of those visiting the Concourse use it more than once a week, with a further 12% visiting about once a week. In other words, 90% of the Concourse's customer base are very frequent visitors.
- In contrast, only 26% of Keys Street customers visit the precinct more often than once a week, with a further 24% visiting weekly. A comparatively high proportion of Keys Street customers are quite infrequent users, with 25% indicating once a month or about once every few months and a further 17% indicating that they only visit the centre about once or twice a year. This frequency of usage is quite atypical of shopping centre and local shopping strip usage patterns.
- In summary, therefore, about half of Keys Street customers are regular users, albeit for a specific purpose as shown later, whilst in the case of the Concourse it is readily apparent that it has a strong loyal and local customer base for regular shopping needs.
- In relation to the Beaumaris Concourse Centre the usage pattern is quite different. Firstly, it is notable that 58% of customers were visiting the Concourse mainly to buy groceries and to pursue convenience shopping, including visiting the local IGA supermarket. This type of purpose is a regular weekly shopping task and is quite different from visiting a milk bar.
- Weekly shopping tasks are generally pursued at centres that offer a range of goods and services that households need on a regular basis and also like to visit regularly for other reasons (eg. to meet people). Such centres would therefore usually include a supermarket or foodstore, together with retailers and service providers such as those found at the Concourse in Beaumaris and at Mentone.
- Some 17% of respondents indicated that they were at the Concourse mainly to purchase takeaway food or beverages, or to visit a restaurant or café. Interestingly, a very small percentage were there mainly for non-food shopping or retail services, although 18% have visited mainly to pursue non-retail activities such as business and medical services.

Ms Brennan submits this pedestrian traffic test is the purpose behind clause 52.28-4, that is, keeping gaming machines out of daily needs shopping centres. In her assessment of whether a significant proportion of buildings are shops, the critical question is whether the shop buildings are sufficient in number or floor area to define, characterise or influence the centre as a whole. Ms Brennan submits that this must be assessed in terms of the test focused on business areas where shoppers congregate and where there is a significant degree of pedestrian traffic.
She submits Keys Street is not a strip shopping centre since it does not host a large number of shops, either a majority, or a significant minority; it attracts very small volumes of pedestrian traffic by contrast with other shopping centres; the hotel is on the fringe of the centre and passing traffic will be limited to pedestrians coming on foot to the centre from the east or visitors to the centre who park in the Bodley Street carparks associated with the hotel. It is reasonable to infer from the spatial distribution of land uses that there is relatively little pedestrian traffic passing the Beaumaris Pavilion.

We are often urged to look at documents as a whole so that the particular provision being scrutinised is considered in context[9].
Pursuant to clause 21.04-3 of the Bayside Planning Scheme, Council's Strategic Framework Plan provides a schematic overview of the major strategic land use and development features. The plan identifies an activity centre hierarchy for shopping centres, within which the Keys Road shopping centre is identified as a neighbourhood activity centre within the meaning of Melbourne 2030.
Therefore when clause 52.28-4 schedule sweepingly includes all strip shopping centres and this centre is notated as a neighbourhood activity centre, there is a prima facie inference that this shopping centre is indeed a strip shopping centre.

By amendment S69 introduced into all planning schemes on a state wide basis, strip shopping centres were excluded from premises that could otherwise obtain planning permission for gaming machines. The explanatory reports to Am S69, as well as Am VC39, are silent on whether a pedestrian traffic test is the purpose behind clause 52.28-4, that is, keeping gaming machines out of daily needs shopping centres.

Whelan****[10] stresses the need to determine the area to which clause 52.28-4 applies.
Because it was not really disputed, it was not argued that the Hotel, being on the periphery of the Keys Road shopping centre and around the corner on Beach Road instead of in Keys Road, was not part and parcel of the shopping centre when considered as a whole. It is equally zoned Business 1 and would be the sole premises outside the shopping centre if it was excluded. Following Crestline[11] and Whelan[12], I agree with the parties and with Mr Shimmin[13] that it cannot be considered to be separate from the centre considered as a whole.

Ms Brennan urged that the planning scheme definition of shop should be used to analyse the area in question. A shop is included in retail premises[14] and is defined as:

Land used to sell goods or services, or to hire goods. It includes the selling of bread, pastries, cakes or other products baked on the premises. It does not include food and drink premises, gambling premises, landscape gardening supplies, manufacturing sales, market, motor vehicle, boat, or caravan sales, postal agency, primary produce sales, or trade supplies.

Food and drink premises are also included in retail premises but are defined separately to shops. They are defined as land used to prepare and sell food and drink for immediate consumption on, or off, the premises.
Since the planning scheme definition of a 'shop' does not include 'food and drink premises' it omits cafes or coffee shops, restaurants and takeaway food shops, which might still be considered 'shops' by lay people applying the natural or ordinary English meaning of the word. After all, a significant proportion of the Lygon Street Carlton shopping centre consists of food and drink premises within buildings constructed with traditional shopfronts, and in my opinion that would not alter its characterisation as a strip shopping centre.
In Crestline[15] and Whelan[16] the Tribunal considered the same issue I have to decide. Crestline concerned a very long strip shopping centre, with different shopping functions along its different components. Whelan was concerned with a Hotel on the outskirts of a shopping centre in the township of Bright, very different to Crestline and to this case.
In Crestline and Whelan both Tribunal members considered that the planning scheme land use definition of shop does not determine the question, because clause 52.28 is concerned with the proportion of buildings that are shops rather than with land use. Also, both members[17] went through the exercise of analysing the uses and considered buildings to be shops even though they housed fast food outlets or cafes, which are outside the clause 74 definition of shop.
I therefore disagree with Ms Brennan's and Mr Shimmin's analysis of what constitutes a shop in this centre. Further, I also think it can mean buildings designed and constructed to look like shops[18]. I referred to built form above under 'Evidence'.

46 Further, in Whelan, which was decided after Romsey[19], Member Rickards was not persuaded by the fact that out of a mix of land uses commonly found in shopping centres[20], shops and food and drink premises 'need to be a majority' in order to be a significant proportion of shops.

As for Mr Shimmin's pedestrian activity exercise, where he found this centre much less frequented than Bayside's Concourse Neighbourhood activity centre, this was also the case in parts of shopping centres discussed in Crestline and Whelan. But lower rates of pedestrian activity did not persuade the Members that this changed the character of their relevant centre as a strip shopping centre when considered as a whole.

As with many questions of law, whether something falls within or outside an expression or definition is often a matter of fact and degree. But, in the final analysis, I think many of the attributes of this lower order centre can be found in many other strip shopping centres in Victoria.
I do not think the fact that it operates as a lower order shopping centre than others within Bayside, as evidenced by its pedestrian traffic, has changed its character as a strip shopping centre yet. Often when centres lose their previous daily shopping needs function, they reinvent themselves to serve a different purpose. That is part of the ebb and flow of a local or neighbourhood centre. One good example of this is the 'High on Orrong' shopping centre in Stonnington, which has reinvented itself with an interior décor focus.
I find that it is an area in which 'a significant proportion of the buildings are shops' for the following reasons. A significant proportion of the buildings are constructed as shops, including much new construction. The overall mix of uses is one often found in a strip shopping centre and equally found in the Concourse shopping centre, although perhaps in smaller percentages[21]. Enough of the buildings are also used as shops applying the ordinary or natural English meaning of the word.
If council believes it is appropriate for the RSL to relocate into the Beaumaris Pavilion Hotel, it could instigate an amendment to the Schedule to clause 52.28-4 excluding the Hotel from the Keys Street shopping centre. After all, Amendment S69 approved on 15 December 1997[22] envisaged councils nominating centres or parts of centres to which clause 52.28-4 ought to continue to apply. This was intended to give councils the ability to nominate strategically, in which centres or parts of centres the opportunity to establish a new gaming venue ought to remain.

[1] Crestline Architects Pty Ltd v Greater Geelong CC [1998] VCAT 100

[2] M S Whelan Investments Pty Ltd v Alpine SC [2008] VCAT 291 (20 February 2008)

[3] Compare with the Boroondara Planning Scheme, which does specify the extent of nominated shopping centres by reference to street numbers.

[4]'A specified person may apply to the Tribunal for the determination of a matter if the matter relates to the interpretation of the planning scheme or a permit in relation to land or a particular use or development of land'.

[6] CHEERS: Communities for Hotels with Eating, Entertainment and Recreation

[7] I have excluded the purely residential development on the corner of Beach Road with Keys Street

[8] Crestline Architects PL v Greater Geelong CC [1998] VCAT 100

[9] Vestey & Ors v Warrnambool CC [2008] VCAT 963 at paragraphs 17 & 61

[10] M S Whelan Investments Pty Ltd v Alpine SC [2008] VCAT 291 (20 February 2008)

[12] M S Whelan Investments Pty Ltd v Alpine SC [2008] VCAT 291 (20 February 2008)

[13] Executive Summary paragraph 2 page i

[15] Crestline Architects Pty Ltd v Greater Geelong CC [1998] VCAT 100

[16] M S Whelan Investments Pty Ltd v Alpine SC [2008] VCAT 291 (20 February 2008)

[17] Crestline at paragraphs 19 & 21, Whelan at paragraphs 16 & 18.

[18] The explanatory report to amendment S69 admits that it does not remove all possibility of ambiguity about whether particular land or buildings are in such a centre.

[19] Romsey Hotel PL v Victorian Commission for Gambling Regulation [2007] VCAT 1

[20] 'including offices, a printing firm, chiropractor, insurance company, real estate agency, two banks, physiotherapist, beautician/massage, upholsterer, medical practice, post office, two service stations and 4 restaurants one of which provides a take away service.'

[21] By this I mean that offices including medical and related services, travel agents, accountants, solicitors and the like are also in the Concourse, although their proportion to the total number of shops appears smaller than in Keys Street. I have not done a count.

[22] which introduced the strip shopping centre prohibition into all planning schemes

Shimmerbridge Pty Ltd v Bayside CC

At a glance

Court

Decision date

Source

Judgment (68 paragraphs)

Shimmerbridge Pty Ltd v Bayside CC (includes Summary) (Red Dot) [2008] VCAT 1428 (21 July 2008)

Parties