Property Law Update - Think carefully before applying for a planning permit to modify a restrictive covenant

Property Law
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Solicitors and planners need to be aware that when making an application to the Supreme Court to modify a restrictive covenant via s84 of the Property Law Act 1958, any earlier application to modify a restrictive covenant via the Planning and Environment Act 1987 process needs to be fully disclosed to the judge hearing the later s84 application.

Part of the reason for this is that the Court’s current practice is to ensure that each and every beneficiary who objected to an earlier application (irrespective of its statutory basis) receives notice of the subsequent s84 application.

This can have a significant impact on the degree of opposition to the s84 application by reason of the broader notice requirements triggered by the Planning and Environment Act 1987 process. Under the planning permit process, each person who has the benefit of the covenant must receive written notice of an application to modify or remove a restrictive covenant.

In contrast, in a s84 application, notice is at the direction of the judge, but this is typically far narrower than direct notice to all beneficiaries.

In recent times, we have found that the Court directing written notice to more distant beneficiaries can have a significant impact on the conduct of the s84 application, by triggering the opposition of parties that might otherwise not have been involved in the s84 process, were it not for this broader notice obligation.

It is often thought that there is little downside in making a speculative application to modify a covenant via the Planning and Environment Act 1987 process, before commencing an application in the Supreme Court, because the only downside is the cost of advertising and a modest application fee. If our experience is anything to go by, there is an additional consequence to consider.

*Matthew Townsend has an online blog, Restrictive Covenants in Victoria, in which he discusses cases and news about restrictive covenants in Victoria. 

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Matthew Townsend has been a barrister for more than 20 years and practises exclusively in planning and environment and property law

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