Compensation on Land Reserved for a Public Purpose – Previous Uncertainty
Part 5 of the Act, specifically sections 98 and 99, provides a mechanism for owners and occupiers of land to make a compensation claim where they may have suffered financial loss as a natural, direct and reasonable consequence of the land being reserved for a public purpose. Prior to the Amendment Act, there was uncertainty surrounding whether the compensation provisions under Part 5 of the Act extended to situations where no Public Acquisition Overlay (PAO) applied to a landholding.
An example of this was seen in Skerdero Pty Ltd v Cardinia SC  VCAT 1334 (Skerdero) in which the Tribunal considered whether compensation would be triggered by refusal of a subdivision permit due to the ‘reservation’ of land for a government primary school under a Precinct Structure Plan (PSP). Ultimately, the Tribunal found that it could not make a decision on the matter on the basis that it lacked jurisdiction to do so. This case raised considerable concerns about the operation of the Act’s compensation provisions and master-planning provisions under the Urban Growth Zones.
Compensation – the amendments
The compensation provisions will no longer apply to ‘inner public purpose land‘ (ie land set aside for a public purpose). Furthermore, there will no longer be an entitlement to compensation if a permit is refused on the basis that the land is needed for a public purpose, and the proposed use or development is prohibited by the relevant Planning Scheme (ie where a permit is inconsistent with the PSP, such as in Skerdero).
Compensation will only be available where the Planning Scheme or Amendment notes an ‘express purpose‘ of reserving land for a public purpose (ie where a PAO is applied). Guidance on which entities are liable for such compensation claims is also provided in the definition of ‘Planning authority‘.
Compensation – commencement
Changes to Part 5 of the Act will impact landowners’ rights, and notably, the liability of Councils. Although the amendments to Part 5 are not yet in operation, the Amendment Act received Royal Assent on 23 March 2021 and is due to come into effect on a date soon to be proclaimed.
Heritage – previous scheme
While the Act currently imposes penalties on developers unlawfully demolishing heritage buildings, the demolition of the 160-year old Corkman Hotel in 2016 prompted the need for stronger legislative protection.
Heritage – amendments
The Amendment Act defines ‘heritage building‘ under section 3(1) and inserts a new section 6B to ‘regulate or prohibit the development of land on which a heritage building was unlawfully demolished or had fallen into disrepair.’ Permits for further development on such land may now only be issued if the proposed development reconstructs, repairs or reinstates the heritage building.
The Governor in Council, on recommendation from the Minister for Planning, may now publish an Order in the Government Gazette blocking or limiting further development for up to 10 years on any site.
Similar to the compensation provisions, these amendments received Royal Assent on 23 March 2021 but are not yet in operation.
Other provisions under the Amendment Act – operative from 1 July 2021
The Amendment Act seeks to modernise the Act and provide increased transparency following the difficulties caused by the COVID-19 pandemic. It formalises provisions of the COVID-19 Omnibus (Emergency Measures) Act 2020 in enabling the online publication or inspection of documents, and enabling panel hearings by audio and audio-visual link. Notwithstanding, privacy implications continue to prohibit government authorities’ publishing online private information without an individual’s consent. Additional miscellaneous changes introduced by the Amendment Act include:
- the Victorian Planning Authority may now recover reasonable costs incurred in preparing strategic and contribution plans;
- a minimum of two months’ notice is required on a planning authority’s website where a proposed planning scheme amendment is abandoned; and
- third parties may now apply to extend a permit if the party has received written consent from the landowner.
How can we help you?
HWL Ebsworth Lawyers acts on behalf of a variety of clients, including landowners and responsible authorities in a range of planning, environment and government matters including compulsory acquisition matters. If you would like to discuss how this judgment affects a proposed compulsory acquisition, or any other matter, please do not hesitate to contact us.
This article was written by James Lofting, Partner, Shantanu Joshi, Solicitor and Emily Russell, Law Graduate.