Tucker v Mornington Peninsula SC No 3 [2006] VCAT 1780

Tucker v Mornington Peninsula SC No 3 [2006] VCAT 1780 - VCAT 2006 case summary — Zoe

[32]

17 The above quoted provision differs from s.18 in various ways. Section 18 contains some discretions to be exercised by the council which do not appear in clause 52.01.

18 The first of these is that s.18 grants the council a discretion as to whether any public open space contribution will be required. That discretion does not appear in clause 52.01. If the land is to be subdivided and intended to be used for residential, industrial or commercial purposes, then the contribution "must" be made. Section 18 says "may", in place of "must".

19 As I have said, the schedule to clause 52.01 in the Mornington Peninsula planning scheme does specify an amount namely 5%. It specifies the flat amount of 5%. It does not say up to 5% or not more than 5%, as was the case with s. 18. Although I think a schedule to clause 52.01 would be able to provide for a discretionary requirement just as it might specify some percentage other than 5, this one does not. The effect is that, so far as Mornington Peninsula Shire is concerned, there is no discretion as to the amount. It is 5% where the requirement applies. Section 18 refers to a percentage not exceeding 5%. The same was true under the LG Act[3].

20 In the above quotation of the first paragraph of cl.52.01 there is reference to s.18 SD Act, but only to note that it is a default provision. In the absence of any further references to s.18 SD Act in cl.52.01 (there is a further reference) this would mean that, so far as Mornington Peninsula Shire Council is concerned, s.18 does not apply. I must deal later with an argument as to whether s.18 should be referred to in relation to the interpretation of cl.52.01, or whether that clause should be interpreted in its own terms and as a stand alone provision with s.18 SD Act and s.569B LG Act forming only background and legislative history.

21 I have discussed the first paragraph of cl.52.01, quoted above[4], so far as if it was an absolute rule. It is, in fact, subject to several possible exceptions specified in the third paragraph of cl.52.01. (The second paragraph of cl.52.01 deals with the subdivision of buildings and is not relevant for present purposes.)

[46]

33 There are a couple of further points to be made in relation to the understanding of the third exemption quoted above. It only applies in relation to a subdivision into two lots. It cannot apply in relation to a subdivision into three or more lots. Furthermore, even then, it only applies where "the council considers it is unlikely that each lot will be further subdivided".

34 The word "unlikely" does not mean "impossible". It does not necessarily mean that further subdivision is "likely". The notion of "further" subdivision necessarily involves a consideration of future possibilities and whether such possible subdivision is "unlikely". It does not impose a limit as to the extent of time into the future that is to be considered. For example, it is not limited to the current intentions of the current owner or the current subdivider or, for that matter, a contemplated future purchaser. It is not even limited to the lifetimes of present owners or prospective purchasers. The time when the consideration is to be undertaken is before the subdivision, as the whole clause relates to a person who "proposes" to subdivide land.

35 In fact, cl.52.01 imposes a current requirement to make a contribution if one proposes to subdivide. The contribution is normally required prior to a certificate of compliance, as it may be difficult or impossible to collect the contribution at a later stage, particularly if the subdivision has been registered and new titles have issued.

36 It may be relevant for the council to consider, in assessing whether further subdivision is "unlikely", that the circumstances of present owners may change, their intentions may change and, in any event, they will not live forever. This very case illustrates how the death of one owner can give rise to a desire to subdivide by heirs of that owner. In fact, subdivision in such circumstances is not only possible, but, generally speaking, likely. Heirs who are not going to live on the land are likely to wish to capitalise on the maximum value of it, quite often by subdividing before sale, or selling it to someone at a price that takes account of its subdivision potential. There must be many thousands of examples of larger holdings being subdivided to capitalise on the subdivision potential. Someone suffering changed financial circumstances or developing an urgent need for money may make it more likely. The grounds of innumerable major mansions have been subdivided off and sold over the years, sometimes in a succession of such subdivisions. Some famous Melbourne examples would be Como, Ripponlea and La Bassa. There are many lesser examples. A drive along St Georges Road or Lansell Road, Toorak will discover a wealth of examples. The fact that land may be particularly valuable probably makes it more rather than less likely that it will be subdivided and sold. The fact that a current land owner may be wealthy hardly makes it unlikely that the further subdivisional potential of land will be realised sooner or later in the future.

37 Another point to be noted about the exemption is that it refers to whether the council considers that further subdivision is unlikely. That raises a question as to whether the council has the last say on that point, or whether its decision on such a point is subject to review by this Tribunal. I cannot off hand think of any proceeding able to be brought under the Planning and Environment Act 1987, the Subdivision Act, or the Victorian Civil and Administrative Tribunal Act 1998 whereby such a decision by a council can be challenged before the Tribunal, except by means of an application for a declaration.

38 A declaration in those circumstances would certainly be open, but it is not likely to be effective. I do not think it would be open to the Tribunal to merely substitute its own view as to whether further subdivision is likely. I think it could only do so if the decision made by the responsible authority was so unreasonable that no reasonable council in its position, and properly instructed itself, could come to the view in fact reached by the council. It would have to be so called "Wednesbury unreasonable".[5] That is a very high degree of unreasonableness. The Tribunal will not substitute a view contrary to that of the council (if the Tribunal formed such a contrary view) unless it concluded that the council could not reasonably reach the view it did reach.

39 In this case, I think, it is perfectly clear that the responsible authority did not consider it "unlikely" that each lot would be further subdivided. I think its conclusion to that effect is unassailable. I am satisfied that further subdivision is, in fact, likely to the point of being highly probable.

40 I conclude that in spite of the evidence, some of it hearsay, as to the intentions of the Tuckers in relation to lot 1 that they have retained and their prospective purchaser (Mr. Lindsay Fox) in relation to lot 2. They have sold lot 2 to him. In this connection I have read the witness statements containing the evidence in chief of Robert Tucker and Kevin Sheives, the licensed land surveyor. Accepting what is said in those documents and noting that Mr. Callander did not wish to advance other evidence from either of them beyond what is stated in those documents; I find nothing to dissuade me from the view that further subdivision is, in fact, likely. At best that evidence does no more than indicate that it is unlikely for the immediate future, and while present circumstances remain unchanged. But the scope of consideration is not limited to the immediate future, and circumstances certainly will change. If nothing else, Mr. and Mrs. Tucker and Mr. Fox will, one day, depart this life.

41 There was a discussion in the course of the hearing as to whether the expression "each lot" meant that the consideration of unlikelihood had to apply severally and cumulatively to the lots. In other words, would the exemption apply if lot 1 was unlikely to be further subdivided, even if it was of the opinion of the responsible authority that lot 2 was likely to be further subdivided.

42 Mr. Callander, on behalf of the applicant, confessed that he had considered such an argument and then abandoned it. He conceded, rightly in my opinion, that it was enough to defeat the exemption if the council considered that one of the lots being created was likely to be further subdivided.

[51]

44 The responsible authority has dealt with the assessment of the cash contribution for public open space, but not in accordance with cl.52.01. It has contemplated separate assessments in relation to lots 1 and 2 whereas it should be 5% of the site value of all the land being subdivided for residential purposes. Clause 52.01 does not actually say all the land being used for that purpose, but that is clearly the meaning. The expression "all the land" appearing in previous legislative manifestations of these provisions has been omitted in cl.52.01. However, I think it is clear that is a result of the so-called "plain English" style of drafting employed here which excludes such expressions when they are thought to be unnecessary. Under previous, sometimes more precise, styles of drafting such things were sometimes put in, even if obvious, to avoid doubt or future debate. In any event, I think it is clear that it is the site value of all the land being subdivided that should be assessed and the responsible authority was mistaken in assessing, as it did, the site value of lot 1 apart from lot 2.

45 Why the responsible authority would agree to the payment arrangements provided for in the s.173 agreement specified in paragraph (a) of condition 9 is quite beyond me. It is deferring, into the indefinite future, a payment it is entitled to receive for public purposes prior to the Statement of Compliance. Although I think it is highly likely that lot 2 will be further subdivided at some stage in the future, that stage may be decades away, and it is, of course, possible that it will never arise. The responsible authority is a public authority dealing with public money in the public interest. It is very generous towards Mrs. Tucker to make such a deferral, but is it responsible conduct in the circumstances? The contingency contemplated may not arise for 20 or 50 years. Is somebody going to remember and enforce payment under the s.173 agreement at that stage? Will it be possible? Who will then be liable to pay? Is the public to be denied until then the benefit of the money that is supposed to be used for public open space purposes?

46 The s.173 agreement has been executed. The responsible authority may well be bound by it. It may be bound, whatever the fate of condition 9 which, as I have pointed out, is under review. The applicant does not wish to pursue that review. That is hardly surprising. I can see no justification for paragraph (a) of condition 9 or any provisions in a s.173 agreement having that effect. I would certainly not sanction such a condition, unless there were reasons that I cannot now imagine, and of which I know nothing at present.

47 As condition 9 is subject to review in this proceeding, I think it is open to me to grant the review and delete paragraph (a). That will not destroy the s.173 agreement that has been entered. It would merely leave the parties with that agreement as an agreement. It may be enforceable as a contract.

48 As to condition 6, I think the whole notion of there being a public open space contribution "for lot 1", rather than in relation to the whole of the land being subdivided, is contrary to cl.52.01 and thus to the law in Victoria. This seems to me to be a good reason to uphold the review and to delete condition 6, although that would not, in my opinion, remove the obligation created by cl.52.01 to pay a contribution of 5% of the site value of the whole of the land. The only merit in leaving the condition would be that removal might make it appear that there was no obligation. Should a condition appear, not because it operates as a condition but merely as a note or reminder that the obligations arise under the provisions of the planning scheme but independently of the condition? I doubt that it should.

49 It is claimed on behalf of the Tuckers that $200,000 being 5% of the site value of lot 1 was paid to the responsible authority "under protest". It was indicated on behalf of the responsible authority that it was news to the responsible authority prior to this application for review that this payment was made under protest. No contemporary written document at or about the time of payment indicated payment under protest. To make such a payment without such a document appears to me to be very rash. However, it was not contested on behalf of the responsible authority that the payment was made under protest. In those circumstances, I will proceed on the basis that it was made under protest.

[59]

53 His point is that, under s.18(1), the power to impose a public open space requirement only arises if a plan of subdivision proposes to create "any additional separately disposal parcel of land". If, as a result of the subdivision, you finish up with the same number of lots that you started with, then it appears that the power to impose a requirement would not arise under s.18(1). In this case, he points out that prior to subdivision there are four lots whereas after subdivision there will be two. He says that in such a situation no requirement can be imposed.

54 Obviously his difficulty is that the words in s.18(1) that he relies upon do not appear in cl.52.01. He wants to read them in on the basis that cl.52.01 is a so-called policy neutral transcription of s.18 into the so-called "plain English" drafting style. (If the SD Act is also in plain English style, then he would say translation to a new wording in that style.) In other words, cl.52.01, he says, is meant to be, and should be read as, saying the same thing as s.18, although in different words.

55 I see no basis or justification for such an approach. I am not aware of any authoritative statement that cl.52.01 is meant to be a policy neutral transcription of s.18. Some such authority would be needed to persuade me that cl.52.01 should not be read and interpreted on its own terms without importing words from s.18 to change its plain meaning.

56 Section 569B(8)(A) LG Act does not contain any such words as those from s.18(1) SD Act which he wishes to import. It would be highly inconvenient, to say the least, that there should be an important qualification to what cl.52.01 says depending upon the importation of absent words that only appear in s.18(1) SD Act. If that was intended, cl.52.01 certainly should have repeated the words argued for. How unsatisfactory. If Mr. Callander was right, then sensible, intelligent people could read cl.52.01 not realising that there are secret, unstated, invisible words that take their place in cl.52.01 to impose an unstated restriction on the clause. It would hardly be plain English if, unbeknown to the reader, absent words are to be read into cl.52.01.

57 In any event, I think it is quite clear that cl.52.01 is not intended to be a policy neutral restatement of s.18 in a different drafting style. The opening words of s.18(1) contemplate planning scheme provisions that will be different to itself. In fact, as I understand it, cl.52.01 deliberately imposes legislative alterations based on changed policy. Clause 52.01 deliberately creates a situation where it, together with a schedule, will remove the discretion as to whether a requirement is made, as well as the secondary discretion, where a requirement is made, as to the amount of the requirement.

58 Mr. Callander concedes this second point. He concedes that cl.52.01 and a schedule, including the schedule in the Mornington Peninsula planning scheme, can and do remove the discretion that would otherwise apply by default under s.18(1) SD Act. Section 18(1) allows anything between zero and 5% of the site value whereas cl.52.01 and the schedule in this planning scheme impose a flat 5% but no discretion for less. That is hardly a policy neutral translation.

59 Once it is appreciated that we are not dealing here with a policy neutral translation the problem arises for Mr. Callander as to why any particular provision in cl.52.01 should be read as if it was.

60 He does not suggest that we are not dealing with a subdivision. Obviously there is a subdivision, as all the documents including the permit and the plan of subdivision attest. He says that what has happened amounts to a consolidation of four lots and subsequently a subdivision of the consolidated area into two lots. Prior to the SD Act that is exactly what would have been required to achieve the result sought by the beneficiaries of the will. Under that regime there could be no doubt that the second dealing was a subdivision. The SD Act, as a matter of convenience, enables the two things to be achieved under the one dealing, although I doubt that that changes the essential nature of the matter being first of consolidation and then a subdivision.

61 Whether that be so or not, as I have observed, Mr. Callander does not deny that we are dealing with a subdivision. Indeed, his willingness to accept deferred payment of a public open space contribution in relation to lot 2 under the s.173 arrangement appears to concede that we are dealing with a subdivision, and furthermore, a subdivision in relation to which a public open space contribution is payable.

62 It is contended that condition 6 is unreasonable and unfair, particularly as four lots will be translated into two lots. In fact that is the legal effect. The practical effect even at this stage is still a subdivision that de facto will lead to at least one additional dwelling in as much as Mr. Fox apparently proposes to build a house for his son on lot 2. It does not alter, or hardly alters the subdivisional potential of the whole parcel.

63 The question is what does the law provide? It is not whether it is unreasonable or unfair. That could only arise if there was a discretion. If there is no discretion, then it is a matter of applying the law as it stands. I have no power to change it, whether or not I think it is unreasonable or unfair. For cases that provide examples to this effect see Grochowski v. Glen Eira CC [2004] VCAT 602 [8] and Parsons v. Glen Eira CC [2006] VCAT 645 [35] - [36].

64 I think it is true that greater flexibility and more discretion enables what might be described as a more fine grained degree of equity than if the relevant statutory provisions allow less flexibility. Of course, the ultimate in mathematical equity, or a descent to the finest distinctions, may lose reasonableness under layers of complication. It is not for me to decide that the law is wrong in the balance it strikes between flexibility on the one hand and clarity and certainty on the other. It is clear that cl.52.01 strikes a different balance to s.18 SD Act. The removal of s.18 discretions means a simpler and clearer regime with no scope for arguments, for example, as to whether a requirement should be imposed at all, and if so, as to how great the requirement should be up to a limit of 5%. I think that is the intention of the new provisions in the planning scheme made under the PE Act. Section 18 SD Act defers to them, and only supplies a default where they have not been implemented.

At a glance

Court

Decision date

Source

Judgment (69 paragraphs)

Tucker v Mornington Peninsula SC No 3 [2006] VCAT 1780 (22 August 2006)

Parties

Legislation Cited (3)