Monday, 22 January 2018

Court of Appeal considers parallel regulation under the Water Act 1989 and the Planning and Environment Act 1987

A recent decision of the Victorian Supreme Court of Appeal has provided authority on the interrelationship between parallel frameworks under the Water Act 1989 (Water Act) and the Planning and Environment Act 1987 (PE Act). In Stanley Rural Community Inc v Stanley Pastoral Pty Ltd, it was ultimately found that licences conferred under the Water Act cannot be limited by the PE Act without an express provision.

What is this case about? 


In 2013, Stanley Pastoral Pty Ltd purchased land which included a licence under s 51 of the Water Act to ‘take and use’ water on its property.  Stanley Pastoral applied to Goulburn Murray Water to split the entitlement to extract 19ML from groundwater and 31ML from surface water.

After the entitlement split was granted, Stanley Pastoral applied to Indigo Shire Council (Council) for a planning permit for the use and development of the land for a 'utility installation', which is defined as land used to collect, treat, transmit, store or distribute water.  Specifically, the permit application was for a change of use from an existing bore to the development of a water transfer station to include a shed, water silos, and associated equipment.

This case commenced after Council refused to grant the permit on the basis that the groundwater extraction would adversely affect the aquifer, diminish the potential for the land for agriculture and horticulture, and prejudice the land served by nearby bores.

VCAT grants permit


At first instance, VCAT granted the permit, finding that the means by which groundwater is extracted was not subject to controls under the PE Act or the planning scheme.  VCAT found that the Water Act provides the necessary controls for the flow, use and management of water (including groundwater).

Objectors appeal the decision


Objectors from Stanley Rural Community Inc appealed VCAT's decision to the Supreme Court.  McDonald J upheld the grant of the permit but for different reasons.

Intention to limit a conferred right should be expressly demonstrated


His Honour centred on the use of term 'expressly' in s 8(6) of the Water Act, which deals with continuation of private rights to water:

A right conferred by this section is limited only to the extent to which an intention to limit it is expressly (and not merely impliedly) provided in…any other Act or in any permission or authority granted under any other Act.

Stanley Pastoral's right was conferred under s 8(4)(a), which grants a person the right to use water taken or received by that person in accordance with a licence or other authority issued to that person under the Water Act.

His Honour found that because there were no words in the PE Act or in the planning scheme expressly qualifying the rights of a water licence under the Water Act, then rights created under the Water Act to take and use groundwater cannot be the subject of objection or control pursuant to a planning scheme.

Final outcome


In a decision dated 20 December 2017, the Court of Appeal refused leave to appeal. 

The Court found that powers to regulate or prohibit use or development of any land under s 6(2) of the PE Act do not expressly demonstrate an intention to limit the rights conferred under s 8 of the Water Act.  Therefore, the PE Act did not limit the right under s 8(4)(a) of the Water Act.  Their Honours further held that the words in parentheses 'and not merely impliedly' within s 8(6) of the Water Act make this clear.

The Court also found that the right conferred by s 8(4)(a) of the Water Act to use water 'taken or received…in accordance with a licence…under this Act' is:

one upon which the permit applicant can rely in respect of water taken and used under the s 51 take and use licence, by virtue of s 8(6) as 'limited only to the extent to which an intention to limit is expressly (and not merely implied) provided in…' statutory instruments of the various types specified.

Separately, their Honours overruled VCAT's finding at first instance that the planning scheme might have made express provision to limit water rights.  The Court cast doubt on the prospect that a planning scheme meets the description found in s 8(6) of the Water Act of 'any permission or authority granted under any other Act'.

Finally, the Court rejected the applicant's argument that the 'real and substantial purpose' of the proposed land use was an innominate 'groundwater extraction' use.  Instead, their Honours confirmed VCAT's finding that the 'real and substantial purpose' of the proposed land use fit within the broad definition of 'utility installation' in the planning scheme - therefore requiring a planning permit for 'utility installation'.

Key take-away


The case demonstrates that licences conferred under the Water Act cannot be limited by the PE Act as it does not currently make express provision in relation to the extraction of groundwater.

Further information


VGSO regularly advises in planning, water and related areas including development approvals, planning scheme amendments, drainage and sewerage projects and land management. For a discussion of the services VGSO can provide in this area, please contact Annette Jones, Principal Solicitor or Natasha Maugueret, Managing Principal Solicitor.

Annette Jones
Principal Solicitor
03 8684 0431

Natasha Maugueret
Managing Principal Solicitor
03 8684 0223

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