Widdison v Moorabool SC & Anor [2002] VCAT 1535

Mr Robert Eskdale, planning consultant, appeared for the Applicants for Review/Applicants for Permit.

The written submissions of the parties, together with numerous photographs, policy documents and other material tendered at the hearing, have been retained on the Tribunal's file.

Subsequent to the hearing the Tribunal carried out an unaccompanied inspection of the subject sites and general surrounding area, the Rural Living Zone and Mt Egerton township and a site in Ballan referred to in the submissions of the parties.

1. These are three separate applications under Section 77 of the Planning and Environment Act 1987 ("the Act") to review decisions by the Moorabool Shire Council to refuse to grant permits (in Application Nos. 2001-359, 2001-360 and 2001-361) for the development of a dwelling on each of three contiguous lots on land bounded by Powerline Cutoff Road, Egerton-Ballarat Road and

2. Each of the applications was lodged separately and determined separately by the Council. However, Mr Fadgyas advised that the grounds of refusal are all identical. Consent has been given to have the three applications for review heard concurrently.

3. The Tribunal adopts the following description taken from the written submission of Mr Fadgyas:

Crown Allotments 13, 14 and Pt of 90E are all located to the south-west of Mt. Egerton township, within the Rural Zone. The three lots are contiguous and generally within the "triangular" area formed by the Egerton-Ballark Road, Egerton-Yendon Road, and Powerline Cutoff Road.

The combined area of the allotments is 21.06 ha, being 7.66 ha for CA 13, 6.88ha for CA 14, and 6.52 ha for Part CA 90E.

The area is bisected by a natural drainage line and falls gently from north to south with some crossfall to the south-east. It comprises generally "improved" pasture land, devoid of remnant vegetation, except that new tree plantings have been undertaken along the property boundaries. The sites are separately fenced and each site has its own dam.

The 3 allotments are currently used for sheep grazing, whilst the rural zoned areas to the east, west and south are also generally in productive agricultural use. The surrounding area is characterised by a variety of lot sizes (some similar in area to the lots under discussion) but with relatively few houses. Many of the adjoining properties are large multi-allotment farms.

The Egerton-Yendon Road generally forms the zone boundary between the Rural zone (to the south) and the Rural Living zone (to the north), whilst the Mt. Egerton Township zone straddles both sides of the Yendon-Egerton Road to the north-east. The majority of dwellings are contained within the Rural Living and Township zones.

4. It is proposed to erect a dwelling on each lot. The plans submitted with the applications show that the dwellings are proposed to be sited as follows:

* CA 13 - Access from Yendon-Mt Egerton Road and set back approximately 20m from that road and 40 m from the western property boundary.

* CA 14 - Access from Powerline Cutoff Road and set back 25m to the east of the road.

* Pt CA 90E - Access from Powerline Cutoff Road and set back approximately 40m to the south of the road and 40m from the western boundary.

5. Each application was supported by a Land Capability Assessment which concluded that the soil profiles of each lot "provide reasonable conditions for the installation of conventional septic tanks and alternative systems".

6. Indicative house designs have been submitted with each application. They show dwellings with three bedrooms, living, family/dining, kitchen and facilities. Building materials have not been fully specified.

7. Mr Fadgyas advised that the subject sites are owned by three brothers who purchased them in 1981. They wish to sell them as rural residential properties and the sole purpose of applying for the permits is for the owners to be able to sell the lots with planning permits for dwellings.

8. Under the Moorabool Planning Scheme the subject sites are zoned Rural and affected by two overlay controls - a Design and Development Overlay Schedule 2 (DDO2) and an Environmental Significance Overlay Schedule 1 (ESO1) .

9. Pursuant to Clause 35.01-3 a permit is required for the erection of a dwelling in the Rural Zone on land less than 40 hectares in area.

10. Pursuant to the DDO2 a permit is required for the construction of a building with reflective materials. Mr Fadgyas advised that the proposed cladding has not been indicated but a standard condition could be imposed.

11. ESO1 applies as the sites are within a Proclaimed Water Catchment Area. The comments of the relevant Water Board must be considered when deciding upon an application to develop land. A geo-technical report (land capability assessment) relating to effluent disposal is a requirement of the overlay.

12. Clause 65.01 of the Planning Scheme directs the Responsible Authority, and this Tribunal, to consider certain matters, including the matters set out at Section 60 of the Planning and Environment Act 1987, the State and Local Planning Policy Frameworks, the purpose of the zone, the orderly planning of the area and the effect on the amenity of the area.

13. The purpose of the Rural Zone, stated at Clause 35.01-1, includes:

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

* To provide for the sustainable use of land for Extensive animal husbandry (including dairying and grazing) and Crop raising (including Horticulture and Timber production).

v Protection and creation of an effective rural infrastructure and land resource.

v Improvement of existing agriculture techniques.

v Protection and enhancement of the bio-diversity of the area.

v Promotion of economic development compatible with rural activities.

v Development of new sustainable rural activities.

14. Pursuant to Clause 35.01-6 in addition to the decision guidelines at Clause 65 consideration must be given, as appropriate, to a range of matters under the headings General Issues, Rural Issues, Environmental Issues and Design and Siting Issues.

15. Relevant sections of the State Planning Policy Framework include Clause 13 (Principles of Land Use and Development Planning), Clause 15.01 (Environment), Clause 17.05 (Agriculture) and Clause 18.09 (Water supply, sewerage and drainage).

16. Council's Municipal Strategic Statement ("MSS") is at Clause 21. Relevant sections referred to in the submissions were Clause 21.03 (Key Issues and Trends), Clause 21.07 (Management of Urban Growth and Development), Clause 21.08 (Protection of the Environment and Landscape) and Clause 21.09 (Facilitation of Agricultural Productivity).

17. Relevant local policies are Clause 22.01 (Townships, Settlements and Streetscapes), Clause 22.06 (Proclaimed Catchments in Rural Areas) and Clause 22.07 (House and House Lot Excisions in Rural Areas).

18. Mr Fadgyas advised that on 24 October 2001 the Council resolved to prepare and exhibit Amendment C15. It seeks to revise the Clause 22.07 policy. Mr Fadgyas advised that the intention is to distinguish applications on the basis of how the lot was created. The amendment, however, is at a very preliminary stage.

19. As the sites are within a Potable Water Catchment Area regard must be had to the Department of Infrastructure "Interim guideline for planning permit application in open, potable water supply catchment areas" of August 2000 (hereafter "August 2000 Guidelines").

20. The Applications for Permit were lodged on 8 October 2001. Following the giving of notice of the applications to adjoining/adjacent property owners no objections were received.

21. Pursuant to Section 55 of the Act the applications were referred to Barwon Water and Central Highlands Water. The former provided no objections, subject to conditions. The latter advised that although it is not a Section 55 authority (as the sites are outside its catchment) it nonetheless submitted objections (pursuant to Section 57(1) of the Act) on the following grounds:

* The inconsistency of these proposals with the objectives of the rural zone.

* The threat of further fragmentation of rural land in the area.

* The conflict with the State Planning Policy Framework requiring planning authorities to ensure land use and development proposals minimise nutrient contributions to waterways and water bodies.

* The conflict with the Municipal Strategic Statement which identifies agriculture as a major contributor to the Shire's economy. This proposal would lead to the fragmentation of rural land and the use of rural land for non-rural uses.

* The proposal's inconsistency with the Interim Guidelines for Planning Permit Applications in Open, Potable Water Supply Catchment Areas issued by the Department of Infrastructure.

22. The planning officer's recommendation that the applications be refused was adopted by the Council. A Notice of Refusal to Grant Permit was issued for each application on 24 April 2002, with the following grounds:

1. The proposal is inconsistent with the State Planning Policy Framework and the Local Planning Policy Framework of the Moorabool Planning Scheme.

2. The proposal is inconsistent with the provisions of the Rural Zone of the Moorabool Planning Scheme as it would result in the fragmentation of rural land and would have a detrimental impact on the surrounding agricultural land uses.

3. The applicant has not demonstrated that the dwelling is reasonably required for the future use of the land for agricultural purposes.

4. The construction of a dwelling on the subject lot would result in land being used for rural residential purposes which is inappropriate in this location, and there is an adequate supply of rural residential lots in more suitable locations within the shire.

5. The proposal would set an undesirable precedent for residential development in the surrounding rural area.

6. The dwelling is not required for the continued use of the subject land for grazing.

7. The proposal would be detrimental to the rural amenity of the area, as a cluster of dwellings at this location would alter the rural character of the area.

8. The proposal conflicts with the Minister's interim guidelines for open potable water supply catchments.

9. The proposal is located on a lot that is incapable of providing a sustainable agricultural enterprise in the form proposed by the applicants.

23. The applications for review, lodged on 14 June 2002, each stated the following grounds:

1. Council has the discretion to issue this planning permit under the Moorabool Planning Scheme, and there are many examples of this discretion being used recently in similar cases.

2. This small lot [relevant size inserted] is within the transitional area abutting both the edge of the "Township Zone" (Mt Egerton Township) and the "Rural Living Zone", hence such discretion should be used to issue the permit on this small property which is not suitable for "broad acre farming".

24. A combined Statement of Grounds was lodged by Central Highlands in July 2002. It included a two-page attachment detailing grounds of objection under the following headings:

1. The development of the three lots is inconsistent with the objectives of the RURAL zone.

2. The development is inconsistent with State Strategy.

3. The proposal [is] inconsistent with State Planning Policy Framework.

4. The proposal is inconsistent with Council's Municipal Strategic Statement.

5. The proposal is inconsistent with the Interim Guidelines for Planning Permit Applications in Open, Potable Water Supply Catchment Areas issued by the Department of Infrastructure.

25. The fundamental issue in each of these applications for review is whether the development of a dwelling on the respective site is intrinsically consistent with the zoning of the land and relevant Planning Scheme policies. An aspect of that issue is the appropriateness of the proposed development in terms of water catchment considerations.

26. Before discussing those matters I wish to comment on the first ground of each application for review; that is, there is discretion under the Planning Scheme to issue a permit and there are "many examples of this discretion being used recently in similar cases".

27. It is not contested that there is discretion for the Council to issue (or be directed by the Tribunal to issue) a permit for a dwelling on each of the lots. If there was no discretion the applications would be simply dismissed on that basis. On this matter I adopt Mr Fadgyas's submission responding to the first ground of review:

Certainly Council has the "discretion to issue this planning permit". However, unlike the "good old days" of the past when Councils tended to interpret "discretion" as meaning "permit with conditions", the New Format Planning Schemes provide much more direction as to the exercise of that discretion.

28. In support of that submission Mr Fadgyas cited Clause 32.01-2. The full text of that provision is:

Because a use is in Section 2 does not imply that a permit should or will be granted. The responsible authority must decide whether the proposal will produce acceptable outcomes in terms of the State Planning Policy Framework, the Local Planning Policy Framework, the purpose and decision guidelines of the zone and any other decision guidelines in Clause 65.

29. Mr Fadgyas also highlighted that Clause 32.10-2 is reinforced at Clause 65. Under the heading Decision Guidelines that clause commences with the sentence "Because a permit can be granted does not imply that a permit should or will be granted". Again consideration of whether a proposal will produce "acceptable outcomes in terms of the decision guidelines" of that clause is required.

30. Contrary to the suggestion in the first ground of review there is no presumption that because there is discretion to issue a permit it should be issued. There is an extensive range of matters which must be considered. The fact that there is discretion is a starting point, or threshold. It does not represent a substantive argument.

31. I acknowledge that by referring to "many examples of this discretion being used recently in similar cases" the first ground of review attempts to include a substantive argument. It embraces the idea of the desirability of consistency in decision making. It also refers to the concept of "precedent".

32. Where there are the same circumstances it is obviously desirable that Councils are consistent in their decision making. Land owners have a reasonable expectation that they will be treated in the same way. This is particularly critical in rural areas where decisions about what type of development is allowed can substantially alter land values and land owners often have a heightened consciousness about what local Councils have approved on nearby land. Such consciousness is apparently acute in the current instance. Mr Eskdale, who is now a private consultant but has a long association with the Council, displayed a keen knowledge of approvals throughout the whole district.

33. Mr Eskdale referred me to a number of cases where dwellings have been allowed (by the Moorabool Shire Council or the Tribunal) on rural lots. He argued that they were comparable to the current proposals and were thus a reasons why permits should now be issued. Where they are relevant to the matters I have to decide I intend to consider the detailed submissions made with respect to those decisions. However, I note at the outset that ultimately it is doubtful whether they will offer much assistance as "precedents". They certainly cannot simply determine the appropriate outcome in the current applications. By its very nature land use planning involves the consideration of proposals for individual parcels of land with peculiar characteristics. Most earlier decisions are likely to be easily distinguished on some basis (such as lot size, location, surrounding land use, historical reasons) from the factors relevant in the current cases. In particular I note that only one of the cases referred to by Mr Eskdale concerned land in the vicinity of the subject sites. Furthermore, as highlighted by Mr Fadgyas, the applicants have not provided "any definitive list of such examples" [where discretion has been recently exercised in "similar cases"]. It is possible that Mr Eskdale has been selective in the choice of cases he has referred me to. There may well be numerous cases where the Council has refused to issue permits in "similar cases". In any case I note that the role of the Tribunal is not to review the decision making by the Council (or Tribunal) in earlier cases or blindly follow any consistent approach which may be evident. The individual merits of the current proposal must be addressed.

34. As a final preliminary matter I note that in re-stating the first ground of review in his written submission Mr Eskdale stated that there is discretion to issue permits "for such applications that meet the majority of the Council's Planning and Zone policies". Again he referred to the "many examples of precedents" where this approach has been adopted "to issue planning permits in similar cases". I am unsure where Mr Eskdale has derived this idea of the necessity to meet a "majority" of policies. Is he suggesting that if a proposal meets more than half of the overall zone objectives and State and Local policies that it is unacceptable? Clearly a more sophisticated analysis is required. There is a range of decision guidelines. A balancing is likely to be required, particularly where there are competing policies. Nevertheless, some of the objectives sought to be achieved by the Planning Scheme are more fundamental than others. It is to those objectives I now turn.

35. Fundamental considerations are the purpose of the Rural Zone and the applicable decision guidelines. The first purpose of the Zone is to implement the State and Local Planning Policy Frameworks. The second purpose is to provide for the sustainable use of the land for rural uses.

36. Mr Eskdale's essential submissions were that as the subject sites are small and have poor soil quality they are unlikely to be individually used for viable general farming and given their particular location they should be given special consideration.

37. On the first matter Mr Eskdale noted that the Council has made it clear that on rural zoned land under 40 hectares there should be a demonstrated link between a proposed dwelling and the rural/farming use of a property. I assume he was referring to the aspect of the Clause 22.07 policy that calls for applications for dwellings be assessed according to criteria including "the extent to which the proposal promotes or supports the continued agricultural use of the land". This is a reflection of the Clause 35.01-6 decision guidelines of "whether the dwelling is reasonably required for the operation of a rural activity conducted on the land". Although Mr Eskdale did not rule out the prospect of each of the lots being purchased by someone proposing "an intensive sustainable farming use" he considered it more likely that the lots would be developed as either small "hobby farm", "rural residential purposes, or for housing of people gaining employment in the local farming industry". He thus conceded that "one of Councils desired outcomes for the Rural Zoned lots to be used for Rural Farming purposes might not be met in each case".

38. With respect to the submission that there should be special consideration Mr Eskdale argued that there is a long history of both the Council and the Tribunal recognising that properties close to the line between zones "often have special 'transitional planning' issues to be considered". He argued that in this instance the lots are within the "transitional area" which abuts both the edge of the Township Zone and the edge of the Rural Living Zone. He submitted that the exercise of discretion should "recognise the practical locational characteristics of the subject lots" and that they should be considered "under the Rural Living Zone parameters".

39. Adopting the idea that the lots should be considered under "Rural living Zone parameters" Mr Eskdale made a number of further submissions. He argued that the proposals comply with the State Planning Policy Framework in that

...the 'Rural Residential' type of development does not encroach on high quality agricultural land; and is serviced by water, electricity and sound roads; and is located abutting the community infrastructure available close by in the abutting Mt Egerton Township the northern boundary of the subject property.

40. Mr Eskdale also submitted that the proposals comply with Clause 21.03 in that the "'rural living' type of development meets the stated criteria focussed in areas of the fringe of Urban Centres where there are [sic] good access to services"." Mr Eskdale noted that "a similar Rural Residential development" has occurred on the northern fringe of the township and on the opposite side of the Yendon- Mt Egerton Road.

41. In particular Mr Eskdale highlighted that in April 2001 the Council approved a permit (P2000/136) for the erection of a dwelling on a smaller adjoining lot which is also in a Rural Zone ("the Gupta case"). He noted that the lot has an area of 1.7ha and is further to the south of the township than the subject sites. He argued that that permit was issued "because this site was similar to and abutting other lots in the adjoining Rural Living Zone". Mr Eskdale concluded that it is "in similar planning circumstances" to the subject sites.

42. It was also Mr Eskdale's submission that the proposals comply "under the majority of...policy criteria" of Clause 22.07. In this regard he noted that the siting of the dwellings would mean that they would not adversely affect the rights of existing farmers to the south of Powerline Cutoff Road to continue their operations. Nor would nearby farming practices be likely to affect the future residential amenity of the two dwellings which would front Powerline Cutoff Road.

43. I do not believe that either of the central arguments in Mr Eskdale's submissions can be sustained. The proposed dwellings would be contrary to the purpose of the Rural Zone, the objectives of the State agriculture policy at Clause 17.05, various provisions of the MSS and Council's detailed local policy concerning houses in rural areas. Furthermore, there is no justification for treating the lots as though they were within the Rural Living Zone when they are, and always have been, part of the Rural Zone.

44. I appreciate that the lots are small and have poor soil quality. This is not a situation where the desirability of removing high quality farmland from primary production is a critical issue. I accept Mr Eskdale's advice that the current use of the land for grazing is not a sustainable rural use. It occurs "as a hobby and to cover the rates". Nevertheless, the absence of an existing sustainable rural use does not by default mean that the development of dwellings is appropriate. As noted by Mr Glossop there is the prospect of the future use of the sites as a rural resource if they are improved. Alternatively the ownership of the three sites by family members family raises the prospect of a combined use. As noted by Mr Fadgyas a total of 20 hectares or so could amount to a "v_ery reasonable part-time farming unit",_ even if it does not result in a productive return which is a "sole source of livelihood". The intensive use of sites comprising aggregated small lots to the west may be some indication of the possibilities.

45. I can find no strategic support in the Planning Scheme for the proposed dwelling. As highlighted by Mr Fadgyas and Mr Glossop the MSS recognises that fragmentation of rural land can occur where residential development takes place on rural areas with no link to the rural activities of the area and new residents start demanding that rural activities be modified. In particular, Clause 21.09 emphasises that rural residential development needs to occur in a planned and orderly manner. It should be located in rural living zones at the fringe of townships and controlled to avoid the conversion of quality agricultural land to non productive land uses.

46. Mr Eskdale's submission that the sites should be subject to special considerations - assessed "under the Rural Living Zone parameters" - has no legitimate basis. The sites are not in, nor have ever been in, a Rural Living Zone. They are in a Rural Zone where the minimum lot size is 100 hectares and permission is required for the erection of a dwelling on land less than 40 hectares. In this case the proposals would represent three dwellings on a total area of just over 21 hectares.

47. Accordingly, Mr Eskdale's reference to "rural residential development" to the north of the town and, closer to the subject sites, on the northern side of Yendon-Mt Egerton Road are of no direct relevance. Those sites are zoned Rural Living.

48. I appreciate that the subject sites would have access to services. There are good roads and the prospect of water supply (even direct town water for one lot) and electricity. The lots are close to the township's community infrastructure and facilities. As a result of my site inspection I accept that the lots have at least some of what Mr Eskdale described as "rural residential attributes". The lots are similar in size to many of those in the Rural Living Zone (which has a minimum lot size of 6 hectares) . The topography and vegetation is similar to the abutting section of that zone. It is however, not identical to the whole of the land zoned for rural living. Much of the land in the Rural Living Zone is generally steeper than the subject sites and affords views. Presumably part of the reason for adopting these different zonings was to reflect the intended use, with the flatter land available for rural uses. Importantly, the zones are different in terms of the density of residential development. It is much lower in the Rural Zone, particularly in the sections adjacent to Yendon-Mt Egerton Road in the vicinity of the subject sites.

49. I accept Mr Fadgyas' submission that there is no recognised concept of a "transitional area". As he noted, that may have been a concept adopted in the past but the New Format Planning Schemes do not include provisions regarding such a concept. Arguably in this instance the Rural Living Zone is the "transitional area" between the township and surrounding rural areas. While the subject sites are zoned Rural there is simply no case for the lots to be considered "under the Rural Living Zone parameters".

50. The permit recently issued for the development of a dwelling on the adjoining lot (the Gupta case) does not represent any form of precedent which should be followed. It is apparent from Mr Fadgyas' explanation that the permit was not issued for the reasons suggested by Mr Eskdale. While it and the subject sites have a similar location with respect to the abutting Rural Living Zone it is not evident that that was the reason why development was approved. The site has a long planning history. A permit for a dwelling was first granted in 1987 (by the Tribunal's predecessor). A permit was issued by the Council in 1995. Its extension was refused in 2000. The Planning Officer recommended refusal of a fresh application as it was not consistent with the Planning Scheme policies. While it is not possible to tell what lead the Council to reject that recommendation it seems likely that the site's planning history and its very small size (incapable of providing any productive return), rather than an assessment from first principles, were influential.

51. Other Rural Zone cases are of little direct relevance. Much was made by Mr Eskdale of the Tribunal's recent approval of a dwelling on a 2 hectare site on the edge of Ballan - Application for Review 2000/37612 ("the Ackers case"). Having inspected that site I think it is clear why Member Eccles found that the particular features of the site made the proposal acceptable, despite its zoning. There area is already subdivided into small lots which are mostly developed with houses. The site had no potential for any rural use. Those features can be contrasted with the subject sites. I also note that the Ballan site has completely different landscape values.

52. Mr Eskdale also drew my attention to the Council's recent approval (on the same night the subject applications were refused) of a dwelling on a 8.654 hectare site at Bungal, 5km south of Mt Egerton (Application 2002-004). Mr Eskdale highlighted that contrary to Council's policy to avoid clustering of dwellings in the Rural Zone the Planning Officer's report justified the development precisely because there is already a number of dwellings in the area. While I appreciate that there may seem to be an inconsistent approach again I note that it is not my role to review the merits of particular Council decisions. I also note that in recommending support of the application the Planning Officer commented that "it is only the history of the site and the unique pattern of development in this area which just gets this application over the line". Those particular factors cannot be used to justify the current proposals.

53. I do not accept Mr Eskdale's suggestion that the proposed dwellings would result in a "seemless compatibility with other surrounding residential development west of the site". My site inspection suggested that the subject sites are relatively exposed. Residential development would have an adverse impact on the current landscape values and rural appearance of the landscape.

54. The objective of the Clause 22.07 policy is "To ensure that small lot subdivisions and new housing development in rural areas will not compromise agricultural activity on adjoining lots". To that end it is policy that all applications be assessed according to an extensive list of criteria.

55. Mr Glossop provided a commentary on each of the criteria. He found little to recommend the proposals in terms of the criteria or issues. I agree with his comments on most of the criteria.

56. For instance, with respect to the planning history of the site he noted that the lot pattern reflects the original Crown allotment layout and has not been "approved" by any Planning Scheme. With respect to the issue of surrounding land uses Mr Glossop commented that the subject sites are at the edge of a low density urban area and sit next to land that is predominantly rural in character. In relation to the existing levels of infrastructure Mr Glossop conceded that the sites are reasonably close to services in the township but noted that the area is not provided with reticulated sewage and drainage. In relation to the agricultural quality of the land Mr Glossop argued that while this is not high quality farmland it is perfectly suitable to extensive animal husbandry. With respect to environmental constraints he noted that the land is in a potable water catchment and has been rated "very poor" for effluent disposal. Mr Glossop commented that by only proposing residential use the applications are contrary to the criteria which refers to the need to discourage non-agricultural use and development in all rural areas. He also argued that the proposal are clearly contrary to the criterion which refers to the need to avoid a cluster of dwellings that are not directly related to the agricultural use of land. With respect to the criterion which refers to the need to promote farm consolidation Mr Glossop acknowledged that the lots are separately owned but suggested that they could be sold as one tenement. He argued that allowing one dwelling on each lot would guarantee the fragmentation of the land once and for all.

57. The Clause 22.07 criteria also refer to the rights of existing farmers to continue their operations and not be constrained by residential concerns and the extent to which the amenity of residents of a dwelling may be adversely affected by agricultural practices on surrounding land. Those criteria reflect the matters required to be considered pursuant to Clause 17.05. They are more controversial in this case.

58. Mr Glossop argued that it is not clear whether or not the proposed dwellings will constrain existing uses. He argued, however, that they must surely restrict the development of nearby land in the future. He commented that the Planning Scheme and contemporary planning practice discourages the use of rural land for residential uses, especially when there are large areas of vacant land already zoned for rural residential type purposes.

59. I do not believe it is self evident that the proposed dwellings would adversely affect the development of nearby farm land. The sites abut a Rural Living Zone to the north and to the east the well-treed strip of land owned by the Crown forms a permanent barrier between the sites and rural land. Higher land to the west, separated by a road, is used for grazing and olive growing. I accept Mr Eskdale's submission that the proposed siting of the dwellings is unlikely to lead to an adverse amenity impacts.

60. Nevertheless I consider that the proposed dwellings would have an adverse impact on the use of agricultural land in a broader sense. On that matter I accept the submissions of Mr Fadgyas and Mr Glossop that approval of these applications would create a "precedent" or at least raise expectations that other owners could also obtain permits. There are numerous small lots in the vicinity (perhaps hundreds throughout the Shire) that are undeveloped. As noted by Mr Fadgyas the creation of an expectation of development would lead to increase in property values of rural zoned land. This would make it more difficult for existing productive farms to continue in a viable form. In essence, every additional dwelling on rural land makes acquisition more difficult for genuine farmers. Incremental development on small lots would over time also lead to the substantial loss of productive land.

61. The potential for the creation of a "precedent" was emphasised by Mr Eskdale. The final section of his written submission was as follow:

The approval of this application would create a desirable precedent for many rate payers who believe there is inconsistency in the way Council treats applications for dwellings in Rural zones on blocks that clearly cannot be used for Agricultural purposes and are located away from larger farming enterprises close to more intensively settled areas.

62. Mr Fadgyas suggested that if the applicants believe their lots should be included within a Rural Living Zone the appropriate method to achieve that purpose is to seek an amendment to the Planning Scheme. That would allow a comprehensive review of the zoning and policies with all stakeholders included in the process. I endorse that view.

63. The submissions of the parties have raised numerous issues that would be relevant in any consideration of an amendment. The location of the sites close to the township and Rural Living Zone and the minimal impact on neighbouring rural uses are no doubt factors in favour of a rezoning. However, they are by no means the only required considerations. For instance there would need to be an assessment of whether there is in fact any need for more land for rural residential purposes. On that matter I heard competing submissions but no evidence. There would also need to be an assessment of the proper planning of any extension of the town. There may well be other areas equally suited, or even more suited, for inclusion in the Rural Living Zone. A comprehensive assessment of town services would also be required.

64. The current proposals represent a request for a de-facto rezoning of the land. Until such time as the land is rezoned, or the Planing Scheme introduces policies which support the development of dwellings on lots such as these, it is inappropriate to endorse the proposals. The applications should be refused solely on the basis of the current zoning of the land and Council's strategic vision for rural areas.

65. That finding essentially determines the applications for review. However, as extensive submissions were made about water catchment issues I intend to make some comments on those matters.

66. I appreciate that the Barwon Water Authority, which controls the catchment within which the subject sites are located, has not objected to the applications provided standard permit conditions are imposed. Although the required Land Capability Assessment classified the sites as "very poor" for the management of waste effluent I note Mr Eskdale's submission that that rating does not mean that the sites are incapable of containing effluent. Mr Eskdale advised of his client's preparedness to enter into Section 173 agreements regarding the maintenance of septic systems. There could even be Package Treatment Plants.

67. I acknowledge that there are constraints in terms of drainage and effluent due to the soil characteristics. While I am prepared to accept that the sites are capable of containing effluent the critical issue in these applications is whether that is enough. In particular Mr Fadgyas and Mr Glossop raised issues concerning the location of the sites within a potable water catchment area and the precedents that approvals would create.

68. Mr Glossop made extensive submissions on these matters. They covered the characteristics of the catchment areas, relevant policies and principles concerning water catchment management, cases determined by the Tribunal (and its predecessors) over 20 years and comments on rural land use planning included in the April 1999 Final Report on New Format Planning Schemes. I do not intend to summarise those submissions. I note, however, the following principles he highlighted. Within drinking water catchments treatment systems, or engineering solutions, cannot solely be relied upon. There needs to be other risk management measures. Problems arise due to the cumulative impact of individual developments over decades. An appropriate response to the management of risk is to follow the August 2000 Guidelines concerning applications in open, potable water supply catchment areas. There is a need for a conservative or precautionary approach. That inevitably involves the curtailment of private rights.

69. Mr Glossop and Mr Fadgyas submitted that the proposals are inconsistent with the Guidelines which suggest that dwelling density should be no greater than one dwelling per 40 hectares unless a land capability study shows a lesser density is appropriate.

70. Mr Glossop was not concerned about the possible contamination of the neighbouring catchment area controlled by his client. He was concerned, however, that landowners in the neighbouring catchment would be encouraged to seek approval for similar developments on small lots. He argued that approval in these applications would be seen as a "signal, if not as precedent, to other land owners".

71. Obviously the proposed developments themselves would have only a marginal impact on the integrity of the water catchment area. Alone water catchment considerations would be unlikely to be determinative of the appropriate outcome. Nevertheless, I accept Mr Glssop's conclusion that these considerations add to the desirability of refusing the applications. Given the soil capability development should not occur at the relatively high density proposed and a precedent, or "signal", for further development should not be created.

72. The Planning Scheme identifies opportunities for residential development in the Rural Living Zone and township. That is where new residential opportunities should be taken up. There is no strategic support for the proposed developments in the Planning Scheme. The policy at Clause 22.07 discourages such development.

73. The area has a legacy of an enormous number of small crown allotments. It would be very easy for the approval of the proposed developments to "open floodgates". Given the historical land ownership pattern I appreciate that landowners could have an expectation that they have an entitlement to develop a dwelling. That is not, however, a planning issue. It would be prudent for the Council to clarify that situation. I note that the proposed Amendment C15 has this as a focus.

74. I acknowledge that the size of the sites owned by the applicants pose problems for long term viable rural use. Again that matter should not override proper planning. There may be a justification for a comprehensive re-structuring of land around the Mt Egerton township. Alternatively, a review of the zoning of land may be appropriate. However, in the absence of such a review and given the current zoning of the land and applicable policies I do not believe the approval of the proposed dwellings on an ad hoc basis can be justified. It would also create an undesirable precedent.

75. For the reasons advanced above I will disallow the Applications for Review and make the appropriate order.