Solid Investments Australia Pty Ltd v Greater Geelong City Council [2004] VCAT 2356

Solid Investments Australia Pty Ltd v Greater Geelong City Council [2004] VCAT 2356 - VCAT 2004 case summary — Zoe

[6]

2

Solid Investments Australia Pty Ltd ("Solid") seeks orders from the tribunal relating to two agreements which affect its land at 6-8 Eastern Beach Road, Geelong ("the Solid land"). The agreements were originally made between the Greater Geelong City Council ("the council") and Brigalow Nominees Pty Ltd ("Brigalow"). Brigalow, together with other owners, now own the land at 10-16 Eastern Beach Road, Geelong ("the Brigalow land"). At the time the agreements were entered into Brigalow was the sole owner of both the Brigalow land and the Solid land. The agreements were made pursuant to section 173 of the Act; and have subsequently been registered on both the Brigalow land and the Solid land.

3

In essence Solid claims that the key provisions in the agreements required or allowed development to be undertaken which breached the planning scheme which then applied to the land. Thus, it is said, the agreements are invalid by reason of section 180 of the Act, which provides that "an agreement must not require or allow anything to be done which would breach a planning scheme or a permit".

4

Solid has also applied to the tribunal for an amendment of the agreements so as to remove its land from the application of the agreements. It is said that the agreements should be removed as Solid is not subject to any further liability under the agreements. It is also said that, having regard to a permit that has issued for a three story proposal on the Solid land, that it is inappropriate that the agreement should continue to apply to the Solid land and to Solid.

5

The questions to be decided in this case arise against a backdrop of an important, but depressed, area of Geelong and a political desire, at the highest levels, to effect timely development. In this context it is not unexpected that there may be some tension between the long term vision of town planners and the political desire to get development on the ground. In these circumstances sometimes corners are cut; and planning instruments are not properly documented. Further, development is a dynamic process and changes are often made to development proposals before construction commence. It can also happen that these type of changes are not properly documented.

[7]

6

On 30 September 1998 the council entered into an agreement with Brigalow called the "Geelong Waterfront Development Deed" ("the 1998 deed"). The deed related to the Brigalow land, which had an area of 6,546 square metres, and the Solid land, which had an area of 2,126 square metres. The two parcels were separated by a roadway, having a width of 6.89 metres. At the time of the deed the council was the owner of the land. The deed was designed to establish the parameters for the development of the land following its sale to Brigalow.

7

The 1998 deed required Brigalow to prepare a development program for the land. The deed contemplated that Brigalow would apply for such consents as were necessary to implement the project, and that a planning scheme amendment would be sought, which would be based upon Schedule E of the deed, to authorise the development and use.

8

The project was envisaged to be the development set out in Schedule B of the deed, which would subsequently be identified in an amendment to the planning scheme. Schedule B of the 1998 deed contained plans titled "the Water Front - Geelong Plans No. 98102 (TP01 - TP13)" prepared by Bruce Henderson Pty Ltd, architects, dated 30 September 1998 ("the 1998 plans"). Although drawn in "freehand" style, these plans were quite detailed plans for the development of the Solid land and the Brigalow land. The plans showed the development of the Solid land with a single storey of themed restaurants, but with an elaborate roof structure reaching a height of 12 metres. The plans showed the development of the Brigalow land with a hotel and apartments. I will return to these plans later.

9

Schedule E of the 1998 deed contained a draft amendment to the Greater Geelong Planning Scheme ("the scheme"). This draft contemplated the insertion of a new clause 162-1 to the scheme to provide specific approval for the development. This course was thought necessary because clause 25 of the Regional section of the scheme then provided a height limit of three storeys, which could be increased with a permit to six storeys; but which prohibited any building greater than six storeys. The proposed hotel building was to be more than six storeys. The proposed amendment was also to include a provision that a planning permit may be granted to vary the requirements of the clause.

[56]

37

Solid contended that both the 1999 agreement and the May 2000 agreement (or, at least, clause 2.1 of the May 2000 agreement) were invalid as, contrary to section 180 of the Act, they required or allowed something to be done which was in breach of the planning scheme.

38

By reason of this alleged invalidity, Solid contended that it was not subject to any further liability under the agreements. Hence it also contended that the tribunal should remove the Solid land from the application of each agreement pursuant to section 184(3) and (4) of the Act.

39

Solid also contended that the tribunal should declare that the February 1999 agreement had been abandoned. Essentially this contention was based upon the proposition that, subsequent to the making of the agreement, the council and Brigalow had conducted themselves in such a way as to evidence an intention that neither would be bound by the agreement. Alternatively it was said that the council had waived its right to require compliance with the February 1999 agreement. As a further alternative, it was contended that the council was estopped from relying upon the February 1999 agreement. It was further said that, if the February 1999 agreement was no longer enforceable, Solid could not be regarded as being subject to any further liability under the agreement and, hence, the tribunal should remove the Solid land from the application of the agreement.

40

Solid further contended that the Solid land should be removed from the application of both the February 1999 agreement and the May 2000 agreement because the tribunal had now granted a permit, for the Solid three storey proposal, which was inconsistent with both agreements. This contention was based upon section 184(4)(b).

41

The council, Brigalow and The Brougham all joined issue. Further they contended that as a matter of law an agreement made pursuant to section 173 of the Act could not be abandoned or waived; and there could not be an estoppel in respect of such an agreement. They also contended that even if there was a basis for relief in the nature of a declaration or pursuant to section 184(4) of the Act, this should be refused as a matter of discretion, principally because Solid had purchased its land in full knowledge of the 1999 agreement and the May 2000 agreement.

[58]

43

A section 173 agreement can be described as a hybrid instrument. In part such an instrument has the character of a private agreement. However it is also an instrument that forms part of the planning controls which apply to land. I will return to this issue later.

44

A planning scheme may provide that any use or development of land is conditional on an agreement being entered into with the responsible authority or a referral authority.[3] A planning permit for any use or development of land may include a condition that the owner of the land, or an applicant for a permit in anticipation of the applicant becoming the owner of the land, enter into an agreement with the responsible authority under section 173 of the Act.[4] Further, a section 173 agreement may be entered into voluntarily by a responsible authority and an owner of land.[5]

45

An agreement may provide for various matters concerning the use or development of land or, indeed, any matter intended to achieve or advance the objectives of planning in Victoria.[6]

46

An agreement made pursuant to section 173 of the Act binds the owner to the covenants specified in the agreement.[7] Further, and importantly, a responsible authority may apply to the Registrar of Titles to register an agreement relating to land (other than Crown land).[8] The Registrar of Titles must make a recording of the agreement in the register, the effect of which is that any burden of a covenant in the agreement runs with the land affected and the responsible authority may enforce the covenant against any person deriving title from the person who entered into the covenant.

47

If a planning scheme or a permit is conditional upon a section 173 agreement being entered into, the owner of the land may apply to the tribunal for an amendment to the proposed agreement.[9] Thus an owner who is required to enter into a section 173 agreement by reason of a planning scheme provision or a permit can ask the tribunal to review the content of the agreement; and the tribunal may determine the content of the agreement which is necessary to satisfy the planning scheme provision or the permit condition.

48

Section 180 of the Act provides:

[61]

49

The responsible authority is obliged to lodge a copy of a section 173 agreement at the office of the Minister without delay after the agreement is made. Further, the responsible authority must keep a copy of each agreement, indicating any amendment made to it, available at its office for any person to inspect during office hours free of charge.[10] The public character of a section 173 agreement is reinforced by section 114 which allows a responsible authority or any person to apply to the tribunal for an enforcement order if a use or development of land contravenes, or will contravene, an agreement under section 173. Further, it is an offence against the Act for a person to use or develop land in contravention of an agreement under section 173.[11]

50

An agreement may provide for the time when the agreement, or a specified provision of the agreement, comes into effect. It may also provide when the agreement ends. Further, an agreement may be ended, either wholly or in part or as to any part of the land, in other circumstances. It may be ended by the responsible authority acting alone, subject to the approval of the Minister. It may also be ended by agreement between the responsible authority and all persons who are bound by any covenant in the agreement.[12]

51

At first sight the scope to amend an agreement is narrower than the scope to end an agreement. Section 178 of the agreement provides that an agreement may, with the approval of the Minister, be amended by agreement between the responsible authority and all persons who are bound by any covenant in the agreement. However it is open for the responsible authority and all persons who are bound by any covenant in the agreement to end an agreement and then enter into a fresh agreement, thereby effectively amending the agreement without the approval of the Minister.

52

It is common for a section 173 agreement to be entered into in respect of land, and then registered on the title to that land, and then for the land to be subdivided. In this case the agreement then attaches to each allotment created from the land. However in this situation a covenant imposed upon an owner imposes a separate obligation on the owner of each lot, enforceable by the responsible authority; and the owner of a lot subject to the agreement is not necessarily a party to an obligation of another owner in respect of another lot.[13]

53

It will be a rare case that a dispute arises when the responsible authority and all persons who are bound by covenants in an agreement agree as to what should be the content or future of the agreement. Disputes are more likely when the landowner and the responsible authority do not agree. In that circumstance the only method prescribed in the Act to amend or end an agreement (being a valid agreement) is that set out in section 184(3) and (4). These provide:

[67]

56

Section 184(3) allows an owner of land to apply to the tribunal for an amendment to the agreement to remove the land from the application of the agreement. This provision contemplates that after land is removed from the application of the agreement, the agreement may still apply to other land.[17] So much is clear from the words used in the section. Hence the contention raised by Mr Testro, on behalf of The Brougham, that an application can only be made by the owner or owners of all the land the subject of the agreement cannot be sustained. Indeed, the sub-section refers to "an owner of land" and can be distinguished from other references in this part of the Act to the owner of "the land".

57

Further, it does not follow that the tribunal cannot amend an agreement to remove land from the application of the agreement if no land will continue to be subject of the agreement. Such a conclusion is not required by logic or by the application of the words used in the section. Further, the agreement may contain covenants that do not run with the land, such as, but not confined to, covenants by the responsible authority, which make it appropriate to remove all land from the application of the agreement; which really means removing the ability of the responsible authority to enforce covenants of the owner against any person deriving title from the person who entered into the owner's covenants.

58

The effect of section 184(4), however, is that the tribunal may only approve an amendment to an agreement to remove land from the application of the agreement in two types of circumstances. The first circumstances is if the tribunal considers that the owner of the land to be removed from the application of the agreement is not subject to any further liability under the agreement. The second circumstance is if, having regard to any relevant permit, or requirements under the Subdivision Act, the tribunal considers it inappropriate that the agreement should continue to apply to the land and the owner. The first of these circumstances will usually be ascertained by examining the agreement and the events that have subsequently occurred. However it would be open to conclude that a landowner was not subject to any further liability under the agreement if the agreement was void from the outset or had otherwise been discharged. As to the second circumstance, there is no reason why the permit or subdivisional requirement that is "relevant" must be a permit or requirement in respect of the subject land itself. It may be that it is inappropriate that an agreement should continue to apply to particular land because a permit has been granted in relation to neighbouring land.

[69]

60

At the heart of the February 1999 agreement is a promise, on the part of the owner of the Brigalow land and the Solid land, to develop the land generally in accordance with the January 1999 plans. This promise can be characterised as a "requirement". Thus the question is whether the development of the land, generally in accordance with the January 1999 plans, would have been in breach of clause 141-12 of the scheme. In identifying this question I reject the submission made by Mr Testro, on behalf of the Brougham, that there should be implied into clause 3 of the February 1999 agreement words such as "obtaining any permits, consents or approvals necessary to do so". There is no basis for such an implication; indeed, the conduct of the parties is to the contrary.

61

Clause 141-12 of the scheme permits the land to be developed with a building greater than three storeys, but only if the building is "generally in accordance with" the 1998 plans. Thus a comparison must be made between the two sets of plans, with a proper allowance being made for the elasticity provided by the words "generally in accordance with" which occur in both clause 141-12 of the scheme and in the February 1999 agreement.

62

I agree with the observation of Deputy President Horsfall in Canet v Brimbank City Council[19] that general accordance is a question of fact to be judged on the facts and circumstances of each case and that the less detail and precision there is in the primary document or documents, the more flexibility is given by the phrase "generally in accordance with". None of the parties to the present proceeding disagreed with this statement of general principle.

63

In one sense the 1998 plans were concept plans. These plans were not intended to be the final plans of the proposed development; rather development plans were to be prepared which would then be the relevant plans for town planning purposes. However an examination of the 1999 plans shows that the plans are detailed and precise as to the building form proposed to be constructed. There are plan drawings for each of eight levels. There are elevations from each four sides. There are two sections. There are also drawings that relate solely to stage 1. Although the plans do not contain dimensions, they are drawn to scale. Significantly, levels, expressed in reduced level form, are referred to in relation to each level or part thereof. I find that the details expressed in the 1998 plans are similar to many plans typically endorsed under a planning permit.

64

It is true, as was pointed out by Mr Molesworth QC on behalf of Brigalow, that the 1998 plans are drawn using a "freehand" style. But the use of this style does not necessarily denote that the design concepts are still vague and uncertain. Rather the use of this technique is often an architectural choice designed to create a softer impression.

65

Mr Main gave evidence on behalf of Brigalow that the 1998 plans and drawings were not detailed building plans, but were concept plans as to the general nature and design of the proposed development and were subject to review and change according to project viability. This may have been the view of Brigalow and its consultants. However the planning scheme must be interpreted by reference to the words used, not the subjective understanding of a landowner or its consultants.

66

In my opinion, the detailed nature of the 1998 plans necessarily restricted the scope of the development plan which might be the subject of an agreement to buildings having a substantially similar form and design to the 1998 plans. It is not as if the 1998 plans were merely schematic. This is illustrated by the fact that the Minister for Planning and Local Government, who was the planning authority for Amendment L233, was said to have personally required a notation on the plans providing for a portion of the parking area to be subsequently converted to retail purposes. I infer that the Minister intended that the ultimate development have a form which was essentially similar to the 1998 plans which were incorporated by Amendment L233.

67

It is apparent to me that the January 1999 plans are quite dissimilar to the 1998 plans; but could they still be regarded as "generally in accordance with" the 1998 plans? Ultimately my conclusion on this question depends upon the cumulation of a number of elements, but it is convenient to consider individual elements in turn.

68

Solid placed considerable emphasis upon the change in the car parking arrangements between the 1998 plans and the January 1999 plans. However I do not regard this change, in itself, as particularly significant. Effectively the 1998 plans proposed one basement car park (at a level of RL0.9) serving the hotel and containing 73 car bays, which would be located beneath the apartment building. By contrast, the January 1999 plans proposed a basement car park (at RL0.6) serving the hotel and containing 76 car bays beneath the hotel building. The access to the hotel car park remained essentially the same. In both the 1998 plans and the January 1999 plans a residential car park, generally at a level of RL3.7 and with access off Yarra Street, was proposed as a separate car park from the hotel car park. The change in the location of the basement car park would have no external impact, does not change the access arrangements or traffic patterns and retains approximately the same number of car parking spaces. Mr Delany SC, on behalf of Solid, suggested that this interpretation of the car parking changes might be an error, possibly due to some mistake by the architect in ascribing wrong levels to the plans. I have examined, and re-examined, the relevant plans. I find no architectural error. Rather I think it is Mr Delany's submission which is in error.

69

Solid emphasised another change which it said led to the conclusion that the February 1999 agreement contravened section 180 of the Act. Solid pointed to the third sub-paragraph of clause 141-12, which provided a condition to be met "to the satisfaction of the responsible authority", namely:

[72]

70

However the area shown hatched in the 1998 plans was at level 0.9 and was beneath the apartment building. The January 1999 plans deleted this level. Hence it cannot be said that the implementation of the January 1999 plans would have prevented the future conversion of the area, hatched on the 1998 plans, to retail purposes. Further, the area shown hatched in the 1998 plans has not been sold for car parking. It may be true that the Minister's requirement, as expressed in the 1998 plans, was somewhat nonsensical, as the level proposed for conversion would have been quite inappropriate for this purpose, but this is not determinative.

71

The 1998 plans involved the construction of stage 1 of the hotel building using what was described as a "tuning fork" arrangement. The effect of this arrangement was to create two fingers of development, having a height of about five storeys, protruding forward of the centre of the Brigalow land. These development fingers would be relatively narrow (in the order of 12 metres wide) and would produce a delicate building form. In a change no doubt influenced by the additional cost of this tuning fork arrangement, the January 1999 plans involved the conversion of the tuning fork into a single wing, having a width of about 15 metres. It is, of course, debatable whether this change produced a better or worse architectural outcome; but that is not the question. The change which was effected would clearly produce a quite different built form outcome, which I find would not be an outcome envisaged by Amendment L233. The January 1999 plans also introduced six hotel rooms on level 7 (at RL18.6) which involved a built form which was not identified in the 1998 plans. Further there were some (relatively minor) changes in the retail areas and the hotel entry.

72

Mr Milner, a town planner, gave evidence in relation to the changes. He said in his oral evidence that the January 1999 plans were generally consistent with the original intent. By this I took him to mean the intent of the strategic policy framework that led to the introduction of Amendment L233, not the words of the clause introduced by that amendment. Mr John Lawson, a member of the Steampacket Development Board in 1999, gave evidence to similar effect. The problem with this evidence is that it is not the intent of the strategic documents that count; rather it is the words of the planning scheme, in particular clause 141-12 introduced by Amendment L233. I am prepared to accept, for the sake of argument, Mr Milner's evidence that the replacement of the tuning fork arrangement with a single wing does not render the development to be any more or less discordant in the streetscape. I am also prepared to accept that the January 1999 plans effected just as satisfactory a solution to the strategic challenge as did the 1998 plans; and was in keeping with the spirit of the planning policy for the precinct. But, in my opinion, none of these issues really count for much. The real question to be addresses must be whether the January 1999 plans, required by the agreement to be implemented, were in breach of the planning scheme, which specifically referred to the 1998 plans.

73

It is true, as Mr Milner pointed out, that the January 1999 plans do not make any significant change to important elements of the 1998 plans, such as the use of the land, the intensity of the land use, the height of the hotel building, the orientation of the buildings, the access points and the general location of the car parks. But it is not enough to point out similarities to establish general accordance with a particular set of plans. Rather it is necessary, where significant differences occur, to assess whether those differences take the second set of plans outside the scope of being in general accordance with the first set of plans.

74

Looking at the key differences, in the context of the nature and precision of the 1998 plans, I find that the January 1999 plans are not in general accordance with the 1998 plans. In particular the change from the tuning fork design represented a radical shift in the form and appearance of the hotel building, which was to be the centrepiece of the development. The consequence is that the February 1999 agreement is invalid. There is no scope for the invalid covenants to be severed, leaving the balance of the agreement intact, as the invalid portions were the heart and soul of the agreement.

75

Earlier I set out clause 4.1 of the 1999 agreement, where the responsible authority acknowledged that the January 1999 plans were generally in accordance with the 1998 plans. If the terms of section 180 of the Act turned upon the opinion of the responsible authority such an acknowledgement might be relevant. But section 180 imposes a requirement which must exist in truth. An acknowledgement, such as that provided in clause 4.1 of the 1999 agreement, cannot operate to change the true position.

76

I record that I do not accept the argument advanced by Mr Molesworth that section 24(3)(b) of the Planning and Environment (Planning Schemes) Act 1996 operated so as to validate an invalid section 173 agreement upon the coming into operation of the new format Greater Geelong Planning Scheme. This transitional principle only operates in relation to valid agreements.

77

I also record that I do not accept the contention advanced by Mr Testro that section 180 of the Act was not breached because it may have been possible for Brigalow to retrospectively obtain a permit for the "as built" works. In my opinion this possibility does not bear upon the question of whether the agreement required or allowed development which would breach a planning scheme.

[73]

78

In the May 2000 agreement Brigalow, then the owner of lot 6 on Plan of Subdivision PS433487C (being the major portion of the Solid land), made two types of covenants in respect of that land. The first type of covenant was to develop and construct lot 6 with themed restaurants in accordance with plans prepared by Napier Thomas Mantesso Allen, architects, dated 5 November 1999. These plans show a two storey development consisting of five, two storey restaurants and three kiosks, together with on-site parking for 12 cars and a loading bay ("the two-storey restaurant proposal"). This proposal was within a 12 metre height limit, but was of a different design to that shown for the Solid land in the 1998 plans.

79

In my opinion, the development shown in the two-storey restaurant proposal could not be regarded as "generally in accordance with" the development shown for lot 6, or the Solid land, in the 1998 plans. The change from a single storey development, to a two-storey development is obviously significant. The 1998 plans did not include any on-site parking. The 1998 plans involved a conservatory which had the nature of semi-public space. Further, the 1998 plans involved a roof form of a sculptural character, something that was still possible with the two-storey building but the change in storeys reduced the impact of this feature. Looking at the 1998 plans, it is true that there is somewhat less detail than was provided in relation to the hotel proposed for the Brigalow land. Notwithstanding this, the 1998 plans are reasonably detailed; and are certainly more than mere squiggles representing some embryonic idea. Given the extent of detail in the 1998 plans and the fundamental difference between what is shown and the two-storey restaurant proposal, it cannot be said that the development required to be carried out by reason of the May 2000 agreement was generally in accordance with the 1998 plans as required by the then clause 141-12 of the scheme.

80

In my opinion, the consequence is that clause 2.1 of the May 2000 agreement is invalid.

81

The covenants included in clause 2.2 of the May 2000 agreement are of a different character, as they relate to the use to be made of the themed restaurant area. The owner promised not to use that area for gaming machines, as general licensed premises, or as a nightclub. None of these promises are inconsistent with, or in breach of, the planning scheme provisions which apply to the land. Having regard to the principles outlined earlier, the agreement should be severed because the agreement can be read distributively and clause 2.2 can stand independently of clause 2.1.

[74]

82

In the circumstances, it is not necessary that I deal with the contention that the February 1999 agreement has been abandoned by the council and Brigalow or waived by the council. This contention was predicated upon the fact that, subsequent to the making of that agreement, the council and Brigalow embarked upon a course whereby the Brigalow land was developed in a manner substantially different to the development plan approved in the agreement. However, as the matter was argued, it may be desirable if I still indicate, in brief terms, my views on this contention.

83

There is no doubt that the May 1999 plans are substantially different to both the 1998 plans and the January 1999 plans. (This is also the case in relation to the hotel building in its "as built" form.) This is so because, in addition to the differences between the January 1999 plans and the 1998 plans, there are other important differences which were introduced by the May 1999 plans. The most important of these relates to the number of car parking spaces, which was substantially reduced. There was also a significant change in relation to the setback of the building from the frontage to Eastern Beach Road. It would seem that the council (through its delegate) thought that Amendment L233 provided the council with a broad discretion to permit departures from the 1998 plans.

84

But I do not agree that the council and Brigalow should be taken to have abandoned the February 1999 agreement by reason of their subsequent conduct. In my opinion, the subsequent conduct of the parties was not consistent with the parties regarding the agreement as inoperative; rather it was indicative of a belief that the agreement was being varied but was still in force. This is illustrated by the procedure which led to the approval of the May 1999 plans and by the manner of that approval. This conduct - indeed the conduct of the parties as a whole - seems predicated on the agreement continuing to operate.

85

There may well be an issue as to whether or not the changes effected by the May 1999 plans could effectively amend the February 1999 agreement in the absence of the consent of the Minister. There may also be questions as to whether a section 173 agreement can be amended other than by formal process, particularly after the agreement was registered on the title of land and in the light of clause 10 of the agreement. There is also the issue of whether an amendment of the February 1999 agreement by the substitution of the May 1999 plans would be open having regard to the fact that these plans did not comply with the mandatory height limits that formed part of clause 141-12 of the scheme then in operation.[20] But for present purposes the only relevance of these issues is whether Solid is, or is not, subject to any further liability under the February 1999 agreement. The answer is that it is not subject to any further liability under that agreement: first, because the agreement was void ab initio because it required development to be done which was in breach of the planning scheme; and, second, because the obligations in the February 1999 agreement in relation to the Solid land were effectively replaced by obligations created in the May 2000 agreement.[21] But if neither of these factors were applicable, I doubt whether it could be said that the owner of the land was not subject to some further liability under the February 1999 agreement, notwithstanding the difficulties in ascertaining the nature of that liability.

86

Even if correct and open, the contentions in relation to abandonment, waiver and estoppel could only apply to the February 1999 agreement, and not the May 2000 agreement. Mr Delany sought to contend otherwise, arguing that the May 2000 agreement incorporated a promise to develop the Brigalow land in accordance with the May 1999 plans. This argument revolved around the promise in the May 2000 agreement to develop land "in accordance with the development deed" and the amendment of that deed by replacing a new schedule C, which referred to a "110 room hotel". But I cannot accept this argument as the May 2000 agreement does not involve any promise at all in relation to land other than lot 6. Further, the substitution of schedule C in the amended development deed of May 2000 was only intended to operate in relation to the staging of the development. It did not involve any independent promise as to the form of the hotel to be developed.

[77]

89

In my opinion, the permit for the three storey proposal on the Solid land is a permit which is relevant to the May 2000 agreement. Further, the permit for the three storey proposal is inconsistent with clause 2.1 of that agreement, which requires a two storey development. The permit was obviously granted after careful consideration and was regarded by the council and the tribunal as an appropriate development having regard to the relevant planning controls. Thus I find that it is inappropriate that clause 2.1 continue to apply to the land and to its owner. However as I have found this clause to be invalid, it is unnecessary to pursue this matter.

90

I should stress that if clause 2.1 of the May 2000 agreement was valid and I wished to remove the Solid land from the application of the agreement on the basis of the permit for the three storey development, I would only have done so on the condition that the owner of the Solid land enter into a further agreement pursuant to section 173 of the Act in which it covenanted that it would not develop the land other than in accordance with the permit for the three storey proposal (including any variation of that permit). In this respect, I would have relied upon section 130 of the Victorian Civil and Administrative Tribunal Act 1998, which provides in sub-section (1) that a power of the tribunal to make an order or other decision includes a power to make the order or decision subject to any conditions or further orders that the tribunal thinks fit. It is true that sub-section (2) includes examples of conditions or further orders, which do not include a condition of the type outlined, but the language used in sub-section (2) makes it clear that those examples are just that and are not intended to cover the field of possible conditions. Mr Delany referred to section 184(4) and argued that there was no power to make a conditional order. But I regard that sub-section as identifying the necessary pre-conditions that must exist before an order is made, rather than displacing the general power to make a conditional order. He also referred to section 184(3) of the Act; but, once again, the words used do not provide a sufficient basis to displace the general power to make a conditional order.

91

The permit for the three storey proposal makes it clear that there ought be no restriction upon the use of premises constructed on the Solid land for a purpose which requires a general licence under relevant liquor legislation. The deletion of conditions 13 and 14 of the notice of decision in respect of the three storey proposal, which formed part of the tribunal's decision on 23 September 2003, combined with the fact that a permit has been granted for a three storey building comprising, inter alia, a tavern, means that the covenant contained in paragraph 2.2(b) of the May 2000 agreement is now inappropriate.

92

It is true that covenants in relation to gaming machines and a nightclub remain consistent with the permit for the three storey proposal. Further it is true that section 184(4)(b) only operates if, having regard to a relevant permit, it is inappropriate that "the agreement" should continue to apply to the land. In circumstances where some covenants become inappropriate, whilst others remain appropriate, it will ultimately be a matter of judgment if the agreement, considered as a whole, is inappropriate having regard to a relevant permit. Much will depend upon the importance of particular covenants in the scheme of things and it may also be influenced by the existence of other statutory requirements that provide a satisfactory regulatory regime in all the circumstances.

93

There exists a very strict regime in relation to gaming machines under the Gaming Machine Control Act 1991 and the planning scheme. It seems highly improbable that gaming machines would be sought for any of the uses proposed as part of the three storey proposal, let alone granted. One cannot help but think that the promise in relation to gaming machines was put in for good measure rather than because of any genuine fear that gaming machines would be included in any development on the Solid land. As for the promise concerning the nightclub, the distinction between this type of use and a tavern use is a fine one. A tavern can operate late into the night. A tavern can play loud music. A tavern can permit dancing.

94

Taking all these matters into account and having regard to the permit for the three storey proposal, I consider it inappropriate that the May 2000 agreement should continue to apply to the Solid land and to Solid. As the valid portions of the May 2000 agreement only relate to the use of land, there is no reason to exercise my discretion to impose a condition such as that discussed above upon the amendment of the agreement in this regard.

At a glance

Court

Decision date

Before

Source

Judgment (102 paragraphs)

Solid Investments Australia Pty Ltd v Greater Geelong City Council [2004] VCAT 2356 (8 December 2004)

Parties

Legislation Cited (2)

Cases Cited (2)