1 Pursuant to Section 149A (2) (a) Planning and Environment Act 1987 the Tribunal makes the following declarations:

(a)

The existing use rights to use the land for the purpose of an hotel is not limited to an hotel that comprises public hotel areas at ground level and administration areas, residential accommodation and facilities for residential guests at first floor level.

(b)

The existing use rights extend to use of the first floor of the land or any part thereof for the purpose of a meeting room, function room, bar private dining room or restaurant.

(c)

No planning permit is required to use any part of the first floor of the land for the purpose of a meeting room, function room, bar, private dining room or restaurant.

Mr D Millear, Director, Southern Property Corporation Pty Ltd

1 Stonnington City Council are seeking declarations in relation to the Argo Hotel, 62-74 Argo Street, South Yarra in the following terms:

1. A declaration that the existing use rights to use the land for the purpose of an hotel are limited to an hotel that comprises public hotel areas at ground level and administration areas, residential accommodation and facilities for residential guests at first floor level.

2. A declaration that there is no existing use right to use the first floor of the land or any part thereof for the purpose of a meeting room, function room, bar, private dining room or restaurant.

3. A declaration that a planning permit is required to use any part of the first floor of the land for the purpose of a meeting room, function room, bar, private dining room or restaurant.

4, Such further or other declaration that the Tribunal considers appropriate.

2 The Argo Hotel is described as a two storey Victorian building, constructed in the 1800's, as a traditional hotel, with public areas on the ground floor and residential accommodation on the first floor. The public areas located on the ground floor include a bistro, restaurant, bottle shop, kitchen and service facilities. The residential accommodation on the first floor has been converted to administration facilities, storage areas and an area where a guest lounge and bedrooms have been converted into one large space, used for the purpose of staff amenities.

3 The hotel building is located on the corner of Argo Street and Highland Street, with a car park, loading bay and service yard to the east of the building. The building is constructed to the street frontages. The first floor incorporates three windows and a balcony with glass doors facing Argo Street.

4 The site is within a residential area with dwellings and residential development surrounding the site. The area falls within the Residential 1 zone under the Stonnington Planning Scheme. Under the zone provisions a hotel defined as 'land used to sell liquor for consumption on and off the premises. It may include accommodation, food for consumption on the premises, entertainment, dancing, amusement machines and gambling,' is a discretionary use.

5 The planning history of the hotel contained within Mr Draffin's affidavit indicates the following:

(1) In 1973 the first floor comprised nine bedrooms and guests amenities, including bedrooms 2, 3, and 4 which each had access to the balcony facing Argo Street.

(2) By 1978, bedrooms 3 and 4 had been converted to a guests lounge, other bedrooms were being used for storage and administrative purposes. Three bedrooms remained on the first floor.

(3) A planning permit application was lodged on 16 January 1979 seeking permission for a dining room for 22 persons within the area formerly occupied by the guest lounge. This application was not proceeded with.

(4) On 16 August 1979 a further application was lodged to establish a restaurant within the same space. The restaurant component of this application was subsequently deleted.

(5) On 16 March 1984 an application was lodged for a restaurant/function room within the guests lounge and bedroom 2. This application was refused and no appeal was lodged.

(6) On 10 August 1994 the use of the guest lounge was changed to a staff lounge incorporating bedroom 3 to include the space formerly occupied by bedrooms 2 - 5. The remaining bedroom was converted into a store room.

(7) On 7 March 2001 an application was lodged to convert the first floor staff lounge and balcony for use as a private function and meeting room. This application was subsequently withdrawn.

(8) Following the commencement of the current proceedings an application was lodged to convert the staff lounge to a function room accommodating up to 80 persons. The application was advertised and 104 objections were received. A Notice of Refusal was issued on 4 May 2005. No appeal has been lodged in relation to the refusal.

6 Mr Peake sought to draw a distinction between what he termed the traditional corner hotel and the modern 'beer barns', although it was not clear in his distinction as to what exactly was different between the two except may be for size and location which does not seem to relate to the actual use being conducted.

7 The Argo, he submitted fell into the category of the traditional hotel with its public facilities on the ground floor and accommodation or private facilities at first floor level. Whilst he acknowledged that this traditional arrangement had evolved over time, the defining feature he maintained was that the public facilities remained on the ground floor.

8 He did not dispute that the whole of the premises have existing use rights for the purpose of a hotel. Rather he submitted, the extent of the existing use right was subject to any conditions or restrictions applying to the use at the relevant date and to assess the extent of the existing use right the use is to be characterised by the purpose of the actual use at the relevant date subject to any conditions or restrictions applying to the use at that date[1]. In this respect he submitted that whilst the use of the public areas of the hotel could be intensified under existing use rights, the public areas of the hotel could not be extended to the first floor because the existing use rights only extended to a hotel generally of the nature that existed at the approval date, being the date on which the new format planning scheme came into effect (13 July 2000).

9 Section 6(3) Planning and Environment Act 1987 provides that:

Subject to sub-sections (4) and (4A), nothing in any planning scheme or amendment shall -

(b) prevent the use of any building which was erected before that coming into operation for any purpose for which it was lawfully being used immediately before that coming into operation.

10 Clause 63.01 of the Stonnington Planning Scheme provides that an existing use right is established in relation to use of land under this scheme if the use was lawfully carried out immediately before the approval date. The approval date relates to the coming into force of the planning scheme and in this respect the relevant date for the coming into force of the current Stonnington Planning Scheme is 13 July 2000. The hotel has been in existence since the 1800's well before any planning provisions came into force. The use of the site as a hotel has therefore been lawfully carried out immediately before the 13 July 2000.

11 Clause 63.02 provides that if a use of land is being characterised to assess the extent of any existing use right, the use is to be characterised by the purpose of the actual use at the relevant date, subject to any conditions or restrictions applying to the use at that date, and not by the classification in the table to Clause 74 or in Section 1, 2 or 3 of any zone.

12 A not dissimilar situation to this matter was the subject of an unreported determination of the Tribunal[2] in which Member Komesaroff concluded, the use of an upstairs area for, amongst other things a function room, fell within the real and substantial use of the land as a hotel and as the hotel had been in existence since 1875, fell within the existing use rights of the building as a Hotel.

13 Member Komesaroff concluded that the reallocation of the various activities carried out within the site including provision of a dedicated function room upstairs is entirely within the existing use rights enjoyed by the land for a hotel and does not require a planning permit. In reaching this conclusion the Member stated:

The hotel was constructed as such in 1875, prior to the advent of planning controls. It clearly generated existing use rights as a hotel, applying the Shire of Perth v O'Keefe [1964] HCA 37; (1964) 110 CLR 529 test, and those use rights have not been lost.

Use for the purpose of a Hotel traditionally encompasses activities such as, amongst other things, sale of liquor and meals, accommodation and can reasonably encompass a function room. Whether activities fall within the designation as a hotel will always be a matter of fact and degree. Provided the operation of the function room remains ancillary to the primary purpose of the hotel (and there is nothing to indicate otherwise) no change to the existing use right has occurred.

Furthermore, the use to which land may be put and the activity on it may change, increase or decrease, so long as the same purpose is served. Uses can intensify, expand or contract or occupy different areas of the planning unit, Nunawading CC v Harrington [1985] VicRp 64; [1985] VR 641.

The fact that the proprietor wishes to convert use of the accommodation portion upstairs to function rooms is consistent with its existing use rights. It merely wishes to refocus its current activities on the site (to use the words of the council's planning officer) or to reallocate its various activities (to use the words of its Counsel, Ms Brennan).[3]

14 The characterisation of the use is a question of fact[4]. The Argo Hotel has existed since the 1800's as a hotel with the various activities associated with a hotel namely, the sale of liquor and food and the provision of accommodation occurring on the site. These activities have been conducted in various parts of the hotel not only on the ground floor but also on the first floor.

15 If Mr Peake's distinction between the traditional corner hotel and the modern 'beer barn' is applied to the Lake View Hotel, the subject of the determination in M R & J Properties[5], the conclusion one could reach is that it would also fall within his description of a traditional hotel with what he sought to describe as the public facilities on the ground floor and the private facilities on the first floor.

16 Although Mr Peake has submitted that the placement of the various activities on the land, in some way acts as a condition or restriction on the use, no conditions or restrictions were placed on the use of the site as a hotel. Whilst it may have been convenient in the past to conduct activities such as the bar, bistro, restaurant, kitchen and service facilities on the ground floor and allocate the first floor for accommodation, the placement of these activities in those locations is not a condition of the use of the land as a hotel, nor is it a restriction on the use of the land. The use still remains as a hotel incorporating all of those activities; namely the sale of liquor and food and the provision of accommodation. Nor does the extent of those activities undertaken on the site place an implied restriction upon the use.

17 The existing use rights of the Argo Hotel are not confined to providing public facilities on the ground floor and any reference to impact that the use of the hotel may have on the adjoining residential area does not confine its existing use rights to that of the ground floor only. The activities conducted on the land may change, they may increase or decrease, as long as the same purpose is served[6]. Nor is it necessary to show that all of the land is used for the given purpose. Where part of the land is unused but part is used for the given purpose, the whole of the land may be regarded as used for that purpose[7].

18 Accepting the conclusion reached by Member Komesaroff that the existing use rights allows for a refocus or reallocation of the various activities on the site then the Argo Hotel can also refocus and reallocate its activities on the site and convert the area upstairs to a meeting room, function room, bar, private dining room or restaurant.

19 As the site has existing use rights as a hotel and that use has not at any time ceased then those use rights continue and there is no requirement for a permit for the use under the provisions of the planning scheme[8]. There may be some requirement for a permit in some circumstances for development if any buildings or works are proposed to be undertaken[9], although under the provisions of the planning scheme any internal alterations to a building that do not increase the gross floor area of the building are exempt, unless a permit is specifically required for internal alterations[10].

20 The declarations sought by the Stonnington City Council in the negative are refused and declarations are made in the positive.

[1] Clause 63.02 Stonnington Planning Scheme

[2] M R & J Properties Pty Ltd v Ballarat City Council (unreported) (P50469/2001)

[4] St Kilda CC v Perplat Investments Pty Ltd (1990) 72 LGRA 368; Francheschini v Melbourne & Metropolitan Board of Works (1980) 57 LGRA 284; Derring Lane Pty Ltd v Port Phillip CC (1999) 6 VPR 231; Port Phillip CC v VBI Properties Pty Ltd (2000) 6 VPR 20

[6] Nunawading CC v Harrington [1985] VicRp 64; [1985] VR 641

[7] Eaton & Sons Pty Ltd v Council of the Shire of Warringah [1972] HCA 33; (1972) 129 CLR 270

[8] Section 6(3)(b) Planning and Environment Act 1987

[9] Clause 63.05 Stonnington Planning Scheme

[10] Clause 62.02 Stonnington Planning Scheme