VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
planning and environment LIST	vcat reference No. P1144/2024
Permit Application no.SP/2024/120 	
CATCHWORDS	
Section 80 of the Planning and Environment Act 1987; clause 53.01 of the Merri-bek Planning Scheme; public open space contribution; two lot subdivision; whether unlikely that each lot will be further
subdivided.	

Applicant	Merri Creek Views Pty Ltd	

Responsible Authority	Merri-bek City Council	

SUBJECT LAND	141 Rennie Street
COBURG VIC 3058	

HEARING TYPE	Hearing	

DATE OF HEARING	20 January 2025	

DATE OF ORDER	13 February 2025	

CITATION	Merri Creek Views Pty Ltd v Merri-bek CC [2025] VCAT 146  	
Order
No change to conditions
1	In application P1144/2024 the decision of the responsible authority is affirmed.
2	No changes are made to the conditions in planning permit SP/2024/120 issued by the responsible authority on 15 August 2024.

Nick Wimbush
Member			

Appearances
For applicant	Hew Gerrard, Glossop Town Planning	
For responsible authority	Graeme Linsell assisted by Vita Galante	

Information
Description of proposal	A two lot subdivision of the subject land.	
Nature of proceeding	Application under section 80 of the Planning and Environment Act 1987 (Vic) – to review the conditions contained in the permit.	
Planning scheme	Merri-bek Planning Scheme	
Zone and overlays	Neighbourhood Residential Zone Schedule 1 (‘NRZ1’)
Development Contributions Plan Overlay Schedule 1 (‘DCPO1’)	
Land description	The subject land is shown in figure 1.  It is 680 square metres in size on the corner of Danny and Rennie Streets. The subdivision creates Lot 1 of 442 square metres and Lot 2 of 238 square metres. Lot 1 contains the original dwelling on the subject land and Lot 2 has an approved planning permit for a new dwelling. The subject land falls approximately 2 metres across the site eastwards from Danny Street.	

Figure 1 Extract from plan of subdivision

Reasons
What is this proceeding about?
1	Planning permit SP/2024/120 (‘subdivision permit’) for a two lot subdivision was issued by Merri-bek City Council (‘council’) on 15 August 2024.  The subdivision permit includes condition 4 as follows:
4.	Prior to the issue of Statement of Compliance, the applicant or the owner must pay to the Municipal Council a sum equivalent to 5.7% of the site value of all the land in the subdivision (in accordance with the Schedule of Clause 53.01 of the Moreland Planning Scheme) intended to be used for residential, commercial or industrial purposes. The applicant / owner must: 
a)	Make a written request to Council for a valuation of the land to determine the invoice value; and, 
b)	Upon the applicant / owner’s receipt of the valuation, make a written request to Council for an invoice for payment of the Public Open Space Contribution. 
If payment of the Public Open Space Contribution is not made within twelve (12) months of the valuation date, the land will be re-valued at each anniversary of the first issue date of the original valuation. Any and all costs associated with the revaluation of the land will be at the applicant / owner’s expense. The applicant/owner must then pay the percentage rate (previously mentioned) of that re-valuation.
2	Merri Creek Views Pty Ltd (‘applicant’) seeks to review the condition under s 80(1) of the Planning and Environment Act 1987 (Vic) and have the condition deleted on the basis that it is unlikely that each lot will be further subdivided.
The regulatory scheme
3	Clause 53.01 of the Merri-bek Planning Scheme (‘planning scheme’) requires that a person who proposes to subdivide land must make a public open space contribution to council; the amount to be contributed specified in a schedule to the clause.
4	Clause 53.01-1 of the planning scheme includes a range of exemptions from the public open space requirements.  In this matter there is one exemption that is in contention:
A subdivision is exempt from a public open space requirement specified in this scheme if:
•	…
•	It subdivides land into two lots and the council considers it unlikely that each lot will be further subdivided.
relevant case law
5	The parties took me to a range of cases said to be relevant to the question of ‘likelihood’ as to whether each lot will be further subdivided. One of the more recent cases is Perera v Casey CC (‘Perera’). In Perera, Member Whitney also considered numerous cases that dealt with this particular exemption.  She provided a list identifying some of the key principles in the case law:
22	In short, I understand the cases to establish the following:
a.	What is important is the objective opinion of the responsible authority, and the Tribunal on review, and not the subjective intentions of the landowner;
b.	Whether further subdivision is or is not unlikely is to be assessed objectively based on the physical facts and circumstances of the subject land (including site constraints) and its surrounds and the planning context of same, including any planning controls and policies that guide future development;
c.	In a temporal sense, there is no warrant to confine what is meant by ‘future’ to a defined period of months or years. However, the greatest weight must be given to the present site context, controls and policies; and
d.	Whether something is “unlikely” is not the same as whether something is impossible – some cases have referred to it meaning ‘improbable’.
6	Having reviewed the cases and Perera in particular I agree with these principles. The current site context and planning controls in my view should be given the greatest weight. The objective view of the decision maker, the Tribunal on review, is to be preferred over the subjective intention of the landowner. 
7	Consistent with the approach in Farha v Darebin CC (‘Farha’), based on the statutory construction of the exemption, I also consider both created lots must be unlikely to be further subdivided (‘each lot’) to have the benefit of the exemption. That is, even if only one of the lots is likely, or rather not unlikely, to be further subdivided, then the application must fail.
Is it unlikely that each lot will be further subdivided?
8	Lot 2 has an approved planning permit for a dwelling (MPS/2023/442). The applicant submits that the approved dwelling and relatively small size of the lot at 238 square metres makes it unlikely that Lot 2 will be further subdivided. Consequently, the issue is the potential future subdivision of the larger 442 square metre Lot 1. Council in its submission also focuses on the potential for subdivision and development of Lot 1.
9	Having reviewed the plan of subdivision and considered the submissions, I am also satisfied that the question around whether the exemption applies is limited to Lot 1. Lot 2 is relatively small and has an approved dwelling permit. The challenges around the subdivision of Lot 1 discussed later in these reasons are similar for Lot 2, but even more so because of its size. I accept Lot 2 is unlikely to be further subdivided.
10	Lot 1 is a larger lot of 442 square metres containing an existing dwelling with frontage to Rennie Street. The applicant argued that further subdivision of Lot 1 is unlikely because, in summary:
•	The policy settings relevant to the Neighbourhood Residential Zone Schedule 1 (‘NRZ1’) identify this as a ‘minimal change area’.
•	The schedule to the NRZ1 modifies standard B13 in cl 55 and increases the canopy tree requirement which would be difficult to accommodate.
•	Advice from the project architect for the development permit (Lot 2) was that Lot 1 would not be suitable for development beyond a single dwelling; this advice was supported by a separate building designer.  
•	The site context including required large setbacks to Rennie Street, slope and the presence of public infrastructure means compliance with cl 55 would be difficult. Particular issues would include overlooking due to the relatively steep fall to the east and the presence of a dwelling at 143 Rennie Street with minimal side setback.
11	The applicant prepared a two bedroom, two dwelling design for Lot 1 and submitted it to council on a pre-application basis. It submitted the concerns identified by council in response relating to cl 55 standards supports its view that two dwellings would be difficult to achieve, and thus further subdivision is unlikely. If development is possible, as opposed to probable, it would in its view need to be more of a one bedroom apartment typology; a form that is not common in this area.
12	Council’s view is that Lot 1 could be further subdivided and there is existing small lot subdivision in the area. It commissioned its urban designer to prepare a sketch of a possible two dwelling development on the subject land, with an approximate 8 metre setback to Rennie Street shown.
13	Council also submits that as a corner allotment, a frontage to Danny Street could be chosen, resulting in a new side setback to Rennie Street of 2 metres in accordance with standard B6 in cl 55 for corner allotments. This would result in a much larger developable area of the site, said by council to be 409 square metres. 
Tribunal findings
14	I am not persuaded either way by the sketches and designs put forward by the parties. Council’s design is simplistic and I am not clear on its assessment against cl 55 which I understand is limited at best. The applicant’s designs maintain a large setback to Rennie Street and do not explore the potential for a scheme with frontage to Danny Street which could increase the developable area.
15	I am not criticising the parties for bringing these designs forward, merely noting that in my mind they do not satisfactorily answer the question of whether further subdivision is unlikely.
16	I note the proposals put forward by both parties do not have the status of evidence and I am not clear on the instructions given to those preparing the schemes or the assumptions they have made.
17	I accept that there are challenges in further subdividing the site based on the zone and policy controls, slope, size of site and the other constraints mentioned driven by cl 55 in particular. However, while this is an area of ‘minimal change’ in policy, it is not an area of no change. I note the modified standard B13 in the NRZ1 schedule regarding landscaping but have not been provided with evidence that it can’t be met, particularly given the possibility of utilising Danny Street as the frontage for development. The fall across the site to the east will need to be addressed in any design, but I do not have any evidence before me that it makes the site unsuitable for development. Designing and building on slopes considering the cl 55 requirements to manage amenity impacts on neighbouring properties is an everyday occurrence in planning and development.
18	In summary, despite these challenges, there is nothing before me that suggests subdivision and further development is impossible. I then need to address the question of whether further subdivision is likely, or conversely unlikely or improbable.
19	For this particular site I consider its surrounding context important. The subject land is only 300 metres from the Number 1 tram on Nicholson Street and metres from the parklands of the Merri Creek. There is clearly demand for infill development in the area, evidenced on the subject land itself and from a review of other recent development proposals in the area via aerial photography. Some of these subdivisions and developments may have been undertaken under a different planning regime but they demonstrate there is interest and activity in intensification in this part of Coburg and Merri-bek. If a further subdivision were to occur, it could result in two lots only slightly smaller than Lot 2 created as a result of this subdivision. 
20	On balance and weighing the specific site attributes and the broader context, I am not satisfied that further subdivision is unlikely, such that the avoidance of the public open space requirement is appropriate. Condition 4 should remain on the permit.
Incorrect amount for open space contribution in the permit
21	Condition 4 of the subdivision permit requires a contribution of 5.7% for public open space. Council submitted that this is an error and in accordance with the table and map in the schedule to cl 53.01, the correct amount should be 6.8% for Area 4 – Coburg. The applicant accepted this position but did not consider it should be corrected through this application.
22	I have found earlier in these reasons that condition 4 should remain and a public open space contribution should be made. As the application is to review the condition, which I have done, I consider it would be outside my remit in the review jurisdiction to unilaterally correct the contribution amount. I note that council can consider the correction of mistakes under s 71 of the Planning and Environment Act 1987.
Conclusion
23	For the reasons given above, the decision of the responsible authority is affirmed and condition 4 remains on planning permit SP/2024/120.

Nick Wimbush
Member