Posted on February 26, 2017 by Sue Puckeridge and Katie Mortimer 5

Restrictions on title of land – how effective are they?

Councils regularly impose conditions on development consents requiring the owner of land to place a restriction to user on the title of land, the effect of which is to limit an aspect of future development on that land. Council is generally the authority given the power to release, modify or vary the restriction.

A recent decision of the Land and Environment Court (‘Court‘) is a reminder that such restrictions will be narrowly construed.  Given the Court’s powers on appeal, they may readily be varied or set aside if a development is otherwise considered appropriate for approval.

Section 39(2) of the Land and Environment Court Act 1979 (NSW), provides that for the purposes of hearing and disposing of an appeal, the Court has, in addition to its other powers:

(2) … all the functions and discretions which the person or body whose decision is the subject of the appeal had in respect of the matter the subject of the appeal.

In D’Alterio v Newcastle City Council [2017] NSWLEC 1058 an appeal was lodged with the Court against the refusal of Newcastle City Council to approve a two storey dwelling, swimming pool and associated site works (‘Development‘).

The Development was to be constructed on land subject to a registered covenant under Section 88b of the Conveyancing Act 1919 .  The covenant had been imposed by Council at the time the land was subdivided.  By its terms it restricted height in a specific area of the land to not exceed a height of RL 28.22 on Australian Height Datum. The authority empowered to release, vary or modify the restriction was Newcastle City Council.

When applied, the restriction would limit the Development to a single storey height.

One of the key issues the Court was asked to consider was whether the proposed inconsistency with the building height restriction was justified.

The Court accepted that in making decisions in relation to development on land the subject of a registered restriction to user, the Court must have regard to the terms of the instrument creating the restriction.  In the circumstances, the Court found that the restriction was imposed in order to maintain views to a nearby heritage item and not to protect private views of nearby properties.

The evidence showed that the Development would not have a discernible impact on views to the heritage item.  Given that the restriction was not relevant to view loss from private properties, the Court was satisfied there were no substantive issues relating to the restriction which would warrant refusal to vary the height restriction (at [73]).

The Court was also not satisfied that the restrictive covenant should operate as a de-facto height control in considering reasonableness of development for the site (at [94]), particularly when this would derogate from the height control in the applicable LEP.

Accordingly, the Court determined to vary the restriction to user pursuant to s39(2) of the Act and upheld the appeal.

The case demonstrates that the Court will not interpret restrictions to user registered on title liberally, but will carefully consider the purpose of the restriction when asked to apply it.  Accordingly, care needs to be taken when imposing conditions of consent requiring the restriction to ensure that the scope of the restriction is clearly expressed.  

Further, when determining a development application, Councils should be cautious in relying on a restriction on title as a grounds for refusing the development, particularly if the restriction does not reflect the current planning controls.

For more information, please contact Sue Puckeridge, Partner on 8235 9702 or sue.puckeridge@lindsaytaylorlawyers.com.au