Mr Brian Fitzgerald, Projects Coordinator, City of Latrobe, appeared for the Municipality.

Mr Neville L. Bond represented Amess Nominees (Bond) Pty Ltd.

Mr Miceal V. Ambrose, Solicitor, appeared for Mrs Dorothy Buckley.

1. This proceeding before the Tribunal deals with three applications made under Section 185 of the Local Government Act 1989 for review of the imposition by the City of Latrobe of a Special Charge on certain properties in Crinigan Road, Jason Street and Ashley Avenue, Morwell for the purposes of street construction.

2. The Special Charge Scheme was declared on the 7th of February 2000 under Section 163 of the Act. The Scheme is for the purpose of recouping costs associated with the sealing of all or parts of Crinigan Road, Ashley Avenue and Jason Street, Morwell. Those streets are located at the north-western edge of the township. The total estimated cost of the project is $69,816.57. The works to be undertaken would provide a bitumous sealed road pavement to a rural standard of 5.5m in width in Crinigan Road from Maryvale Road in the east to Jason Street in the west, and provide the same sealed road pavement to the northern part of Ashley Avenue and Jason Street. There are 17 properties affected by the Special Charge Scheme. All of the properties are approximately 4h in area. All have been charged the same amount under the Scheme, that is a full benefit unit of $4,168.15, except for one property which runs through to Andrew Street to the north, which is proposed to be charged only $3,126.12 (equivalent to 75per cent of a single unit charge) on the basis that a further charge would be made against that property under another scheme for the upgrading of Andrew Street.

3. While the "special benefit" of the Scheme to the affected properties was not specified in any written documents to which I was referred, Mr Fitzgerald explained that the roads suffered a dust problem in summer and were in poor condition/wet in winter. These problems would be overcome by the road sealing, he said.

4. The grounds upon which an owner of property upon which a Special Charge has been levied may seek a review by the Tribunal are set out in Section 185 of the Local Government Act. The four grounds are:

"(i) the works and projects or the period of maintenance for the purposes of which the special rate or special charge was imposed are not or will not provide a special benefit to that person; or

(ii) the basis of distribution of the rate or charge amongst those persons who are liable to pay it is unreasonable; or

(iii) if the planning scheme for the area contains any relevant policies or specific objectives, the works and projects proposed for the construction of a road or for the drainage of any land are inconsistent with those policies or objectives; or

(iv) if the planning scheme for the area does not contain any relevant policies or specific objectives, the works and projects proposed for the construction of a road or for the drainage of any land are unnecessary, unreasonable, excessive, insufficient, unsuitable or costly, having regard to the locality or environment and to the probable use of the road or drainage of the land."

5. Sub-section (3) of Section 185 sets out the powers the Tribunal has on review: the Tribunal may vary the special rate or charge in relation to its application to the applicant for review, set the special rate or charge aside if the ground in sub-section (2)(b)(ii), (iii) or (iv) is established, or dismiss the application and confirm the special rate or charge. Section 185AB requires the Tribunal to take into account any relevant planning scheme and where appropriate scheme amendment. In this respect, the plan provided to me at the hearing by the Responsible Authority indicated that the subject properties are either included in the Rural Zone or the Residential 1 Zone of the Latrobe Planning Scheme.

6. Three applications for review have been lodged with the Tribunal in response to the imposition of the rate by the City.

7. One has been lodged by Mrs Marjorie Smith who is the owner/occupier of a property on the western side of Ashley Avenue towards its southern end. Mrs Smith's property is Lot 19 on Lodged Plan 111605. The special charge scheme would see Ashley Avenue sealed only as far as her front gate and not along the entire frontage to her property.

8. A second application for review was lodged by Amess Nominees (Bond) Pty Ltd, which company owns three properties within the area of the Special Charge Scheme and another abutting property just outside the Scheme area. The three properties affected by the Special Charge Scheme are Lots 12 and 13 on Lodged Plan 111605 and Lot 1 on Lodged Plan 127269. It would seem that the dwelling for the three Amess Nominees properties is located on the lot which is outside the Scheme area and the principal accessway to the dwelling is via Maryvale Road. While two of the Amess Nominees lots would be abutted by roads to be fully sealed under the Scheme, the third lot in the Scheme, which is located on the eastern side of Ashley Avenue opposite Mrs Smith's property, would only have a short abuttal to the section of road to be sealed and the greater part of its frontage would abut a section of Ashley Avenue which would continue to be unsealed.

9. The third application for review was lodged by Mrs Buckley who owns/occupies a property on the northern side of Crinigan Road. All of her frontage would abut a sealed section of that road. Mrs Buckley's application for review was lodged out of time and application was made under Section 126 of the Victorian Civil and Administrative Tribunal Act 1998 to extend the time for lodgment. By letter dated the 26th of May 2000 consent to the extension of time was received from the Municipality, as the only other relevant party. The City's letter indicated that:

"This agreement is on the basis that Mrs Buckley's application only concerned the issue of an increase in estimate costs compared to earlier advice prior to the declaration of the scheme by Council."

10. Another Tribunal Member granted that extension of time on the 29th of May 2000. Subsequently Mr Ambrose, solicitor, wrote on behalf of Mrs Buckley to the Registrar and to the City Council advising of revised objections to the scheme. That letter was forwarded on the 31st of May 2000. The expansion of Mrs Buckley's grounds for review had earlier been foreshadowed in a letter to the Council from Mr Ambrose of the 25th of May 2000. However, a later letter from the Shire indicates that that 25th of May letter was not faxed to the Shire until the 29th of May 2000 by Mr Ambrose. Thus it seems that the City was not aware of the fact that Mr Ambrose was intending to lodge the expanded grounds of review with the Tribunal on Mrs Buckley's behalf when they gave their conditional consent to the extension of time for lodgment of her application for review. The City replied to Mr Ambrose on the 23rd of June opposing the expansion of the grounds for review by Mrs Buckley, indicating that they would advise the Registrar accordingly. They did so by facsimile transmission on the 17th of July 2000, two days before the hearing of the review.

11. The matter of this late lodgment of the application for review by Mrs Buckley, the Council's conditional agreement, and the question of whether the Tribunal should allow the amended grounds to be argued were again addressed at the outset of the review hearing.. As was explained at the time, notwithstanding the Council's conditional agreement to the extension of time for lodgment of Mrs Buckley's application, that extension of time was granted by the Tribunal unconditionally. The question which then arose was whether the amended grounds for review by Mrs Buckley foreshadowed in Mr Ambrose's letter to the City dated 25th of May 2000 should be accepted. Section 127 of the Victorian Civil and Administrative Tribunal Act 1998 allows the Tribunal at any time to amend a document in a proceeding, either upon application by a party or the Tribunal's own initiative. That section is routinely used in the Planning List to amend the notice of application for review itself. In making any amendment the Tribunal must of course act fairly (see Section 87). Consideration needs to be given inter alia to whether adequate notice has been provided to the other parties in advance of the hearing of the intention to amend the document. In this case, given that Mr Ambrose's letter to the Municipality was sent well in excess of six weeks before the hearing, it could not be said that the Municipality was disadvantaged in any way by short notice of the intention to argue the amended grounds. I believe that it is appropriate to formally record here that amendment of Mrs Buckley's grounds for review under Section 127 of the act was in effect allowed during the hearing given that the expanded grounds were permitted to be argued on her behalf and a response was made by the City.

12. Mrs Smith and Mr Bond essentially want the sealed section of Ashley Street to be extended so that the entire frontage of their properties would have abuttal to a sealed roadway. They submitted that those properties were the only two included in the scheme, other than Lot 7 on Lodged Plan 111605 at the western end of Crinigan Road, not proposed to be provided with sealed roadway along the full frontage. They advised also that the owner of Lot 7 had indicated no desire to have such sealing. Mrs Smith also said that it was unfair that she had been asked to pay a full benefit unit when, unlike other properties, only part of her property frontage would be sealed. These arguments can be said to fall within Section 185(2)(b)(ii) - that the basis of distribution of the charge amongst those persons liable to pay is unreasonable.

13. Ms Smith described her needs for access to the southern part of her property from Ashley Avenue. She said there are restrictions imposed by development in the vicinity of the existing northern accessway to her dwelling which mean that access from that driveway to the southern part of her property is unpracticable. She also advised of the neglect of upkeep of the roadway in the past. The failure to extend the road scheme along her entire frontage, therefore, suggests that the works proposed are insufficient or unsuitable in the terms of Section 185(2)(b)(iv).

14. Mr Bond argued also that sealing of the roads abutting his lots would be of no benefit to his property, given the existing access via Maryvale Road. He said that if the Council simply restored the roads to their original condition and maintained them in that condition, then an unsealed surface would be sufficient to cater for vehicles given there is no through traffic and little local traffic. He pointed to the Council's failure to in any way maintain the southern end of Ashley Avenue for the last 15 years. These arguments relate to the ground found at Section 185(2)(b)(iv) - that the road works are unnecessary, excessive and insufficient.

15. The submissions made by Mr Ambrose on behalf of Mrs Buckley related to two of the five amended grounds of review lodged on her behalf. That is:

"That the issue of new planning permits for a nine lot plan of subdivision off Jason Street and the fact that the Latrobe Shire Council has not requested any contribution from this developer to the scheme is equitable.

That the cost of the scheme should be further apportioned on a more equitable basis to include the further nine lot subdivision."

16. That matter was also referred to by the other parties seeking the review of the Council decision.

17. These grounds refer to an approved subdivision by the City of a property which abuts the southern end of Jason Street: Crown Allotment 76M. That property is part of the Special Charge Scheme and was charged a single benefit unit. The application for a planning permit to subdivide that land was received on the 19th of October 1999. The planning permit which was subsequently issued on 17th of December 1999 created nine new lots each in the order of 4,000sq m. Four of the nine lots in that subdivision directly abut Jason Street.

18. Mr Fitzgerald for the City acknowledged the approval of that planning permit and advised that he believed that if the Council had been aware of the application for planning permit, they may have varied the distribution of the charge amongst the properties liable to pay. Nevertheless, Mr Fitzgerald advised that a condition was included on the planning permit for subdivision which requires that at the time of any subsequent subdivision of any lot larger than 2,000sq m, the owner would be required to make a financial contribution to the Council for the upgrading of the roads servicing the land to urban standards. He indicated also that he believed the construction standards for Jason Street under the proposed Special Charge Scheme would provide for the estimated traffic volumes from that subdivision together with traffic generated by the existing developed properties abutting the street.

19. Referring to the fact that approximately 50 per cent of the properties in the Special Charge area are zoned Residential 1 and the remaining properties zoned Rural, Mr Fitzgerald explained also said that the City had taken the view that due to the very low demand for new residential lots in Morwell (only approximately 18 new lots have been created in the last five years) it would not be fair and equitable to apportion charges to owners based on the differential potential for further subdivision under the two zones. If other allotments in the Residential 1 Zone were subdivided in future, he said, conditions requiring the upgrading of the road system would be imposed.

20. It seems to me that the determining factor in relation to this proceeding before me is this issue of the failure of the Council in striking the rate to recognise the concurrent subdividing of Crown Allotment 76M at the southern end of Jason Street. It seems to me, as was said at the hearing, that there was a breakdown in communication between the Council's Planning Department which received the planning permit application for subdivision, and the Engineering Section striking the special rate, given that the planning application was received and determined in the period between 19th of October and 17th of December 1999, and the special rate was not declared until February 2000, following an extensive public discussion phase commencing in May 1999.

21. At present, there are some 17 properties included in the Special Charge Scheme, and as noted earlier, with the exception of Lot 7 on Lodged Plan 111605 (in part levied under another scheme), all properties are charged one benefit unit. That includes Crown Allotment 76M. It seems to me that the subdivision of the latter property has the potential to add to the road system which is the subject of this Special Charge, the demands of an additional eight households (or at least four households if only those occupying the properties directly abutting Jason Street are included). This represents an approximately 50 per cent (or 25 per cent) increase in the number of properties utilising and benefiting from the sealed road system. It is my view that it is an unreasonable imposition on the existing properties in the scheme to carry the cost for that relatively large number of additional households soon to utilise the roads, and on this basis I believe that the ground for review - that the basis of distribution amongst those liable to pay the rate is unreasonable - is made out.

22. I advise also that I do not believe that the condition included on the planning permit for the nine lot subdivision which would require a future financial contribution to the Responsible Authority for the upgrading of roads to urban standards, in the event of subsequent subdivision of any lot larger than 2,000sq m, redresses this imbalance. It was Mr Fitzgerald's advice that for all lots in the Residential 1 Zone, any future subdivision permission would be subject to planning permit conditions requiring the further upgrading of the road system. Some properties would therefore contribute twice to the road improvements for the locality.

23. As was discussed briefly at the hearing of the application for review, I had some concern at that time that the fact that the inequities of the Scheme had only come to light after the decision to impose the rate was made by the Council, was perhaps not sufficient to make out the ground for review. It was submitted on behalf of the Council that their decision on the Charge Scheme was made in ignorance of the proposal/permit to subdivide one of the lots in the scheme into nine. At the time of the hearing I indicated to the parties that it seemed to me appropriate that I invite further submissions on that issue, and would write to them accordingly.

24. I have revised my view on this matter, however, and do not now believe it necessary to seek further submissions. I believe that the Tribunal on review can find that the basis of distribution of the charge amongst those persons who are liable to pay is unreasonable based on the knowledge before it, even though all of that knowledge was not necessarily before the Council. That is to say the Tribunal is not confined to assessing whether the Council acted reasonably on the basis of the information before it, but may review the Council decision by a de novo assessment based on new information. It seems to me that the grounds for review of Special Charge Schemes must allow for information to come to light after a Council has imposed a charge or rate, otherwise it would oblige the Tribunal to uphold a Council decision even if it had been made inter alia in ignorance of relevant factors.

25. In light of my finding that the basis of distribution of the charge amongst those liable to pay is unreasonable (by as much as between 25 and 50 per cent), I believe that the only appropriate course is to set aside the special charge.