1. Responsible Authority's decision is varied as described in Order 2.

2. Direct the issue of a permit pursuant to the Responsible Authority's Notice of Decision to Grant a Permit 99/471 dated 7 September 1999 such that:

(a) The permit is issued to Bunnings Building Supplies Pty Ltd; and

(b) Is expressed to permit use of the land at 225 Midland Highway, Shepparton, for landscape gardening supplies.

But otherwise in accordance with the terms of the Notice of Decision to Grant.

Mr Kalms, Planning Officer on behalf of the Responsible Authority.

Mr Wright, QC and Mr Townshend on behalf of the Applicant for Review instructed by Minter Ellison.

Mr Morris, QC and Ms S. Brennan on behalf of the Permit Applicant instructed by Lander & Rogers.

1. The site at No. 225 Benalla Road (Midland Highway) Shepparton is approximately 2km east of the Shepparton Central Business District. It is on the north side of the highway and consists of 2.13h. It was formerly occupied by the East Shepparton Bowls Club. The site is flanked by car dealerships to the east, King Wally Car Sales; and to the west a Hyundai dealership.

2. On 30 June 1999 the City of Greater Shepparton as Responsible Authority received a permit application lodged by Peps Plans Pty Ltd seeking a permit for "homeware retail warehouse/shop and nursery". It was advertised on 6 July 1999 as an application by "Peps Plans on behalf of Bunnings". On 7 September 1999 the Council issued a Notice of Decision to Grant a Permit No. 99/471 which provided for a permit for the use and development of the site "for a hardware superstore in accord with endorsed plans". Two objections had been lodged with the Responsible Authority - one in the name of "S.T.Y. Building Supplies Pty Ltd". On 27 September 1999 Minter Ellison, Lawyers, lodged an application for review on behalf of S.T.Y. Building Supplies (Shepparton) Pty Ltd. The Council objected to the competency of the review application on the footing that it was made by a party other than an objector to the permit application. Council's objection was heard on 10 December 1999 and on 17 April 2000 Mrs Bruce, Deputy President, published her determination in which she permitted the review application to proceed in so far as it challenged the decision to grant a permit for the use of the site but struck out the review application in so far as it challenged the decision to grant a permit for the development of the site.

3. The review application came on for hearing before us on 10 and 11 July together with related proceedings brought by the applicant for review seeking an enforcement order and a declaration under Section 149B of the Planning and Environment Act 1987.

4. When the proceeding was called on, Mr Morris QC, who appeared with Ms S. Brennan on behalf of the permit applicant (proponent) sought amendment to the proceeding such that the permit applicant was shown as Bunnings Properties Pty Ltd and the use for which the permit was sought was amended to read "landscape gardening supplies". The rationale for this latter amendment was, as we understand it, that it is Bunnings' contention that all uses comprised in the "hardware superstore" are as of right on this site with the exception of a nursery component and it is this component that necessitates the application for the permit for use "for landscape gardening supplies".

5. The amendments were opposed by Mr Wright QC and Mr Townshend on behalf of S.T.Y.. For reasons which we then gave we ordered that the proceedings be amended in accordance with Mr Morris' application.

6. Meanwhile a further permit application 99/801 was lodged with Council on 10 December 1999, once again by Peps Plans Pty Ltd "as agent for Bunnings Building Supplies Pty Ltd" for development of the site for trade supplies and timber yard. A permit for development of the land for trade supplies and timber yard was issued by delegation on 14 December 1999.

7. The site is within a Business 4 Zone and the abutting land is a Category 1 Road Zone (the Midland Highway) with the other abutments being zoned Business 4. The purpose of the Business 4 Zone is:

"To implement the State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies.

To encourage development of a mix of bulky goods retailing and manufacturing industry and their associated business services."

8. The Business 4 Zones in Greater Shepparton include large tracts of land abutting the highways which pass through Shepparton.

9. Mr Kalms on behalf of the Council submitted:

"The development of the land for the proposed use as a Bunnings Building Supplies clearly falls within the Planning Scheme definitions of trade supplies, timber yard and restricted retail."

10. As a result, since each of those uses is a Section 1 use, that is, as of right, no permit is required.

11. S.T.Y. Building Supplies (Shepparton) Pty Ltd owns and operates a Mitre 10 outlet in Shepparton's Central Business District.

12. Mr Wright QC and Mr Townshend who appeared for S.T.Y. referred us to S.T.Y. Building Supplies (Shepparton) Pty Ltd v City of Greater Shepparton and Lascorp Development Group (Aust) Pty Ltd (1997/93326) a determination of the Tribunal relative to a development proposal for a highway site some 3km to the south of the centre of Shepparton. Ms Moles and Mr Quirk rejected that proposal inter alia on the basis that it was inconsistent with a 1996 strategy document which is now part of the Municipal Strategic Statement in the present Planning Scheme for Greater Shepparton to the effect that the primacy of the Shepparton Central Business District should be maintained and that the establishment of further large retailing facilities should be limited.

13. Mr Wright and Mr Townshend further submitted that since the proposed outlet would have a floor space exceeding 4,000sq m the requirements of the Retail and Office Development Guidelines issued by the Minister of Planning and Environment in October 1999, which he submitted required an economic analysis of the impact of proposals such as this, had not been complied with. Hence they submitted, at best this proceeding should be adjourned to enable the studies required by the guidelines to be completed. They submitted that the guidelines operated according to their own force, extended to proposals for use as well as development and did not depend for their application upon a reference to them in the current Planning Scheme which was introduced after the lodgment of the permit application.

14. They said the Lascorp case dealing with a proposal on a similar highway location a few kilometres to the south of Shepparton logically required the rejection of this proposal.

15. They submitted that a development along the usual pattern of a Bunnings Warehouse would fall within the definition of "shop" in the Planning Scheme which use is prohibited in a Business 4 Zone.

16. They submitted that the principles for characterising the proposed use could be derived from the judgment of Ashley J. in Cascone v Whittlesea (1993) 11 AATR 175, 190 and the decision of Nicholson J. (as he then was) in Davey v Brightlight Nominees Pty Ltd [1984] VicRp 76; [1984] VR 957. They submitted the various components of a Bunnings Warehouse were independent uses rather than an instance of a dominant use with a number of ancillary uses and "a Bunnings store is essentially a large hardware shop which sells an extensive range of hardware, homewares and gardening supplies". Where there were a number of uses not ancillary to one another they submitted that Clause 64 of the Planning Scheme required that "each use must comply with the Scheme". They submitted that the following as of right uses for the zone, namely restricted retail premises, lighting shop, trade supplies and timber yard, did not individually or collectively encompass all of the non-ancillary uses which were entailed in a Bunnings Warehouse.

17. They submitted that the evidence which they would call showed that only approximately 15 to 20 percent of the sales of a typical Bunnings Warehouse were sales "to the trade".

18. Mr Andrew Biasci, the Director of Contour Consultants Australia Pty Ltd and a qualified planner, said that he had examined 11 Bunnings stores throughout metropolitan Melbourne, finding them typically with a floor area of 10,000sq m with an average of 360 car spaces with a range from 250 to 500 at the different locations. The layout was uniform. He said:

"The buildings tend to be laid out so that there is an indoor/outdoor timber section at one end, an indoor/outdoor garden centre at the other and the main sales/display area situated in between and within the main building."

"claim a total stock of in excess of 45,000 items and the classes of merchandise cover the following

20. They also called a Mr Celle, the General Manager Merchandising for the Mitre 10 Group. Mr Celle explained that Mitre 10 is a buying and merchandising group which provides services to a group of independent outlets trading under the Mitre 10 and related brands. Before taking up his present position Mr Celle had undertaken similar work for McEwans, another hardware outlet in Victoria. Mr Celle's evidence drew not only upon his own observations, but those of assistants who surveyed a number of Bunnings outlets. He said that the merchandise in the Bunnings Warehouses was predominantly marketed to private consumers or do it yourself customers, rather than to tradesmen. This was typified by the generally small packs in which items were sold. A pack designed for a private consumer would have a relatively small number of units in it and be designed with a see through packing to enable the consumer to see the item or items. They would be displayed on a hanging display. Trade packs on the other hand would contain a larger number of items and would be in opaque boxes because tradesmen are already familiar with the characteristics of the items and tend to order by serial number. Since ordering is by serial number the items need not be visually displayed and may be on rack shelving remote from the public part of the store. He concluded that Bunnings was not of the same character as traditional trade suppliers, a number of which he named.

21. Mr Morris QC, who appeared with Ms Brennan submitted that the proposed use of the land characterised in the Notice of Determination as a "hardware superstore" or known in retailing circles as a Bunnings Warehouse, could be characterised as "trade supplies" and "restricted retail premises" both of which are as of right uses in the zone. These uses are specifically excluded from the definition of the use "shop". The only portion of the proposed complex which might not be comprehended within those land use descriptions was the nursery and this was to be regarded as a use for "landscape garden supplies". That use was legal in a Business 4 Zone under the Scheme subject to the grant of a permit. Accordingly, as previously noted, Mr Morris' client now seeks a permit for use of the land for "landscape garden supplies".

22. Mr Morris and Ms Brennan submitted that it would be wrong to characterise a Bunnings Warehouse as a "shop" as had been contended by Mr Wright and Mr Townshend.

23. They referred to Clause 74 of the Planning Scheme which states:

"A term describing a use or activity in relation to land which is not listed in the Table must not be characterised as a separate use of land if the term is obviously or commonly included within one or more of the terms listed in the Table."

24. They submitted that a broad and commonsense approach to the characterisation of land uses must be adopted, relying upon Shire of Perth v O'Keefe [1964] HCA 37; (1964) 110 CLR 529, 534-5 per Kitto J. and Pacific Seven v City of Sandringham [1982] VicRp 14; [1982] VR 157, 160 per Marks J. They continued:

"The merchandise stored and sold at Bunnings generally fits the description of merchandise required by the building or landscaping trades and by do-it-yourself home handy people for the construction, improvement, maintenance and decoration of buildings, together with products for general household use, such as outdoor living furniture."

25. The "as of right" land use "trade supplies" is defined in the Scheme as follows:

"Land used to sell by both retail and wholesale, or to hire, materials, tools, equipment, machinery or other goods for use in:

(h) local government, government department or public institution."

26. According to Mr Morris and Ms Brennan "the definition of trade supplies should be interpreted by reference to the nature of goods supplied rather than by the end user of the goods". This is supported by the "use in" the building trade, the landscape gardening trade etc, instead of the words "use by" the building trade, the landscape gardening trade etc. They further said that the reference to sales by retail "supports the inference that sale to members of the public was contemplated within the definition of trade supplies".

27. Next they observed that the use "trade supplies" includes timber yards, which is defined as:

"Land used to sell sawn, dressed and treated timber, wood fibreboards and the like. It includes the cutting of timber and boards to order, and selling hardware, paints, tools, and materials used in conjunction with the use and treatment of timber."

28. They observed that the reference in this definition to selling hardware, paint and tools "is not limited by its terms to hardware, paint and tools sold to professional builders for their use only. It is submitted that it would be absurd to limit "trade supplies" into which "timber yards" is nested by reference to a qualification which does not limit "timber yard" ".

29. They submitted that guidance could be found in decisions given under the old format metropolitan planning schemes which include a definition of "peripheral sales" in the following terms:

"* Premises in one occupation with a floor area of at least 1,000sq m used to sell or hire furniture, floor coverings, furnishings, household appliances, swimming pools, camping gear or automotive parts and accessories;

* Premises in one occupation with a floor area of at least 500sq m used to sell or hire electric light fittings;

* Materials used to sell or hire party supplies, equestrian supplies or materials, tools, equipment or machinery for use in industry, commerce, the building or automotive trades, the medical profession, landscape gardening or primary production."

30. They referred to a decision of Mr Byard sitting in the Administrative Appeals Tribunal in the matter of Mollica v Shire of Bulla (1992) 9 AATR 157, 169-70 where speaking of the third paragraph of that definition he said:

"The definition [of peripheral sales] is more concerned with the nature of goods sold or hired and their consequent need for substantial low rent areas for storage and display than it is for the question of whether the purchaser is a consumer or a trader."

31. They also relied upon an unreported decision of the Administrative Appeals Tribunal in the matter of Capt'n Snooze Management Pty Ltd v City of Waverley (1994/673) wherein an adjudication relative to the Nicholas Kiwi site in Warrigal Road, the Tribunal held that "materials for use in commerce" extended to the provision of office supplies to members of the public.

32. They placed reliance upon the evidence of an expert planner Ms Ring who conducted an historical survey of permit proceedings for a number of hardware superstores under the "Bunnings" and "BBC" brandnames which showed that these uses and developments had been allowed typically as "peripheral sales" under the old format schemes or as "restricted retail premises". They concluded "it makes no difference in planning terms whether a ladder is sold to a builder or a home handy person". They observed that the definition of "shop" which is admittedly a prohibited use in the Business 4 Zone, specifically excludes "trade supplies" and "timber yard", therefore the objectors' contention that the proposed use would be a "shop" "must fail".

33. They relied upon Ms Ring's report in so far as it supported the grant of a permit for use for "landscape gardening supplies".

34. According to Ms Ring the proposed merchandising areas will have a total area of 7,358.34sq m representing 93.1 percent of the floor space with a further 542.64sq m devoted to ancillary/non-merchandise uses yielding a total area of 7,900.98sq m. The largest merchandising area would be garden and nursery at 2,776.85sq m followed by the timber section - 1,847.9sq m; paint 609.6sq m; electrical 620.2sq m; flooring 213.58sq m; plumbing 714.65sq m; registers would occupy some 331.42sq. Amenities are to occupy 61.4sq m; a playground and café 51.65sq m and goods receiving area 98.13sq m. According to Mr Morris this is a slightly smaller Bunnings development than the typical metropolitan one and it was not proposed to include any automotive items.

35. As a result of the amendments which we have ordered, the only permit which is now sought for use is for use of the premises for "landscape gardening supplies". This is a permit required use in a Business 4 Zone and the use is defined as follows:

"Land used to propagate, grow, and sell plants or sell and distribute gardening supplies."

36. Ms Ring in her expert report concluded that this site was an appropriate one for use for landscape gardening supplies. As we understand it, no party contends otherwise. This is a use which is specifically contemplated for this zone, therefore we see no reason why we ought not to direct the issue of a permit for the site for this use. It might be said that this conclusion disposes of this proceeding.

37. In our view however, the larger issues of land use characterisation remain and in light of the lengthy argument which we have heard and the proponent's clear desire to use the site for a much wider range of detailed purposes which it contends may be done as of right and which the objector contends are prohibited, we should say something on these issues as well.

38. At first blush Mr Morris' submission to the effect that the phrase "for use in" serves to describe the character of the goods to be supplied, rather than their end user, seems to fly in the face of the language. It would have the phrase mean something like "goods of a kind ordinarily acquired for use in" being of similar purport as to a description to the phrase "goods ... of a kind ordinarily acquired for personal, domestic or household use or consumption" to be found in Section 85(1) of the Goods Act 1958 (and the similar phrase to be found in Section 4B of the Commonwealth Trade Practices Act 1974) which serve to delineate consumer from purely commercial sales of goods in those statutes. If the draftsman of the Scheme had intended the phrase to have this operation, why would he not have used words similar to those to be found in the Goods Act and the Trade Practices Act before the reference to the various trades in the balance of the definition? With some hesitation however we conclude that Mr Morris' submission is correct. In the well known decision Newton v Incorporated Nominal Defendant [1970] VicRp 32; [1970] VR 257 Newton J. (apparently not related to the plaintiff) gave what has been considered to be the classic exposition of the phrase "used or intended for use on any highway" which was a key part of the definition of "motor car" in the Motor Car Act 1958. There is a corresponding definition of "motor vehicle" now in the Road Safety Act 1986 which defines a motor vehicle as: "A vehicle which is used or intended to be used on a highway ...". The significance of these definitions is that compulsory third party insurance (in the days of Newton's case) and now benefits from the Transport Accident Commission are payable when an injury arises out of the driving of a motor car or a motor vehicle, but not if the conveyance falls outside the definition. The conveyance in question in Newton's case was an excavator. The learned Judge said:

"In my opinion a sufficient test of whether a vehicle is "intended for use on any highway" is whether a reasonable man looking at the vehicle with full knowledge of its characteristics would say that one of its users was use on a "highway" ... " [1970] VicRp 32; [1970] VR 257, 262

39. His Honour concluded that the excavator was not a motor car according to that meaning of the term. His Honour's analysis has been adopted and approved over and over since. Most recently it was approved by the Court of Appeal in Transport Accident Commission v Ball [1999] VR 64. Buchanan JA with whom Callaway and Batt JJA concurred said:

"In my view the word "intended" in the definition is used in the sense of "suitable or apt" ... or "meant for".

40. The Court was there concerned with the characterisation of a motorcycle, manufactured for road use but confined to "off road" uses for many years before the accident.

"In my opinion evidence of use may throw light on or reinforce or demonstrate what a particular vehicle is suitable or meant for. Thus the limited road use in fact made of the excavator reinforced the impression created by its physical characteristics. However, evidence of actual use should not be employed as a means of revealing the current intention of the owner or rider." [1999} 1 VR 64

42. The phrase "for use in" is of similar purport to the phrase "intended for use on". In our view a reasonable person looking at the range of timber and power tools, hardware, paint and so forth would conclude that one of their uses was in the building trade. For the purposes of the definition it matters not whether the supply is by way of retail or wholesale. We accept that the packing and presentation of the goods in a Bunnings Warehouse would, in accordance with the evidence of Mr Celle not be the form in which one would expect those goods to be presented for the building trade, nevertheless the packaging in itself renders the individual items no less "apt" for use in the trade. Other items which would typically be sold in a Bunnings Warehouse would create a use comprised in the concept of "restricted retail premises" which is defined to mean:

43. Our conclusion as to the breadth of the use "trade supplies" is consistent with the view reached by Mr Byard as to similar words in the definition of "peripheral sales". It is also we think consistent with the approach adopted by Nicholson J. in Davey v Britelight Nominees Pty Ltd [1984] VicRp 76; [1984] VR 957 in the application of the then definition of "industrial sales" under the Melbourne and Metropolitan Planning Scheme Ordinance which referred to "any premises upon which ... machinery, equipment or materials are brought kept or exposed for sale, lease or hire for use in primary or secondary industry". His Honour's approach was to consider the characteristics of the goods rather than the character of the purchasers. His Honour was reviewing the decision of a magistrate who had convicted defendants of offences against Section 49 of the Town and Country Planning Act 1961. The Magistrate had made findings which excluded any suggestion that purchasers at the outlet in dispute were confined to "the trade". His Honour nevertheless found it necessary in disposing of the matter to proceed to consider the nature of the goods which were being sold.

44. In our view, it was not mandatory for the applicant to lodge the material referred to in the policy statement by the Minister for Planning and Environment as to retail development and office development with its application. Clause 17.02-2 of the Scheme, forming part of the State Planning Policy Framework requires the information provided for in the policy statement to be lodged "in support of retail and office development proposals in excess of 400sq m in floor space". The Planning Scheme came into existence on 29 July 1999. The application which led to the Notice of Decision under review was lodged on 30 June 1999. At that time there was nothing in the then current Scheme corresponding with Clause 17-02. Mr Wright submitted that the policy statement operated according to its own force. He did not however refer us to any provision which could render a policy statement by the Minister a mandatory requirement for a permit application unless that policy statement were rendered mandatory by the applicable scheme. Mr Morris submitted that until the adoption of the new format Scheme last year, the policy statement applied and was referred to only in Metropolitan schemes. The policy statement is styled "Metropolitan Activity Centres" which would support this view. We conclude that as at the date of lodgement of the application there was no mandatory requirement that the material referred to in the policy statement should support it. Section 25 of the Planning and Environment (Planning Scheme) Act 1996 requires that pending permit applications must be determined in accordance with the new scheme rather than the old and Section 26 requires that review applications in the Tribunal be conducted in accordance with the new scheme rather than the old, hence the references in our reasons had been to the new and current scheme rather than the scheme which was in force at the time of the lodging of the original permit application. It is not clear however that the application of the new criteria for adjudication could retrospectively require the lodgment of further material which was not required at the time of initial lodgement. If we are wrong in this we note that the obligation to lodge the material referred to in the policy statement applies only with respect to "development proposals". The permit to develop with respect to this proposal has already issued. The present proceedings as previously explained relate only to use.

45. Nor in our view should the Tribunal's decision in the Lascorp Development Group stand in the way of our affirming the Responsible Authority's decision. The proposal in Lascorp was for a large development on a highway site, perhaps slightly more distant from the Shepparton Central Business District than the present one, to include bulky goods/peripheral sales, supermarket specialty shops, petrol station, car wash and fast food outlet. The proposal therefore was for something approaching an integrated shopping centre. That is clearly materially different from this proposal which entails the establishment of one single outlet. Nevertheless the Tribunal observed:

"We are of the view that the peripheral sales outlets on the site and the convenience shops would operate synergistically and provide the opportunity for multi-purpose trips. It would be artificial, we believe, to down play the centre's attractiveness ...even if we are wrong in this, the proposed hardware store at 7,280sq m would in any case, be the fourth largest non-food retailer in Greater Shepparton with potential regional significance diverting interest from the CBD. We agree with Mr Farquar that given its regional significance such an outlet should be located within the Central Business District or at its fringe, given the strategic intent to support the CBD."

46. Clearly the proposed hardware outlet considered by the Tribunal there and thought by it to be inappropriate for a site similar to the present one was on the same scale as the present location. The Tribunal in Lascorp quoted at substantial length from a number of policies, principally a strategic report in 1996 which now stand as part of the Municipal Strategic Statement in the present Scheme. After a detailed analysis of the strategy the Tribunal concluded that:

"There is only in the order of 8,000sq m of unallocated floor space demand remaining (or perhaps 12,000sq m if the two closed supermarkets' floor space is added in) ... the development of almost 14,000sq m of retail floor space on the subject site would be absorbing all new demand (and more) preclude the opportunity to enhance the network of centres as a whole"

47. The Tribunal's remarks about the hardware outlet were obiter since the proposal was not for a hardware outlet but rather for an integrated centre with a much larger floor area. It is unnecessary for us to reproduce the policy statements which form part of the Municipal Strategic Statement. They have already been set out by the Tribunal in Lascorp and analysed there. The problem with giving effect to the policy as perceived by the Tribunal in Lascorp is that it is quite inconsistent with the zoning provided for in the Scheme. The area around the Shepparton Central Business District includes large tracts of highway abutment zoned Business 4. In those very large areas the wide range of retail outlets considered earlier in these reasons are "as of right" uses. There are no floor space limits attached to these zones. In our view the specific zoning provided for in the Scheme must prevail over the Municipal Strategic Statement. See Section 7(4)(b)(ii). In any event the Municipal Strategic Statement (Clause 21.05-2) states that the Highway abutments are to be "the focus of peripheral sales development". The expression "peripheral sales" is not defined in new format planning schemes such as the present. Based on the definition from the old format schemes considered by Mr Byard in Mollica's case we take it as encompassing a "hardware superstore"/

48. We affirm the Responsible Authority's decision and direct the issue of a permit pursuant to the Responsible Authority's Notice of Decision to Grant a Permit 99/471 dated 7 September 1999 such that:

(a) The permit is issued to Bunnings Building Supplies Pty Ltd; and

(b) Is expressed to permit use of the land at 225 Midland Highway, Shepparton, for landscape garden supplies.

But otherwise in accordance with the terms of the Notice of Decision to Grant.