Single Dwelling
Covenant Policy
June 2011
Responsible Directorate: City Development and Amenity
Date of adoption: 15 June 1999
Date of revision: June 2011
Authorised by: Phillip Storer, Director, City Development and Amenity
Single Dwelling Covenant Policy
June 2011
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Table of contents
1. Introduction...................................................... 3
1.1.
1.2.
Purpose
Scope
3
3
2. Background...................................................... 3
2.1.
2.2.
Context
Corporate framework
9
9
3. Policy statement .............................................. 9
4. Implementation and monitoring ..................... 10
4.1.
Accountabilities
10
5. References ....................................................... 11
5.1.
5.2.
Related documents
Definitions
11
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1. Introduction
1.1. Purpose
The purpose of this policy is to recognise and reinforce the relevance and importance that single
dwelling covenants have in relation to the ongoing management of the development of land in the
municipality.
Council recognises its broader role to plan for the housing needs of its current and future populations.
However, it recognises the need to balance the demand for more diverse housing types with existing
features of the City that also attract residents. These features include, but are not limited to,
heritage, urban character and the environment. Restrictive covenants can have a significant
influence in regard to these features.
1.2. Scope
This policy applies to all planning permit and planning scheme amendment applications made to vary
or remove single dwelling covenants on land in Boroondara.
2. Background
What is a Covenant and what does it do?
A restrictive covenant is a private legal agreement between a land owner and purchaser that is
registered on the Certificate of Title.
Covenants are most commonly applied when an owner subdivides land and wishes to apply some
restrictions on the future use or development of the lots created. For example, a common covenant
prevents the development of the lot for more than one dwelling. Covenants have also been used to
specify the type of building materials that can be used of the minimum cost of construction.
Restrictive covenants bind any future purchasers of the land unless the covenant is varied or
removed. Similarly, any subsequent purchasers of the lots in the original subdivision held by the
original owner at the time the covenant was agreed to have the legal benefit of the covenant. These
beneficiaries are able to enforce the restrictions of the covenant through the Supreme Court.
Council is not a party to the restrictive covenants, unless as a relevant land owner, and is unable to
enforce a covenant on behalf of a legal beneficiary.
There are many instances where the existence of restrictive covenants in residential areas have
provided a strong influence over the character of a neighbourhood and helped to create a much
sought after area. This is particularly the case with single dwelling covenants.
Legislation
Prior to 1987, the only way a covenant could be removed or varied was to apply to the Supreme
Court of Victoria under Section 84 of the Property Law Act 1958. As Council was not a party to the
agreement creating the covenant, Council had no standing in such an application.
In response to concerns as to the cost and time involved in such matters, the Planning and
Environment Act 1987 (the Act) was amended to enable either a planning permit application, or a
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request to amend the planning scheme to be made as alternative mechanisms for the variation or
removal of a covenant.
As a responsible authority and a planning authority, Council clearly has a role in both of these
processes. Subsequently, the Act was further amended in 1991 to provide two assessment streams
through the Planning Permit Application process.
Variation and Removal of Restrictive Covenants
There are three methods of removing or varying a covenant:
1.
Application to the Supreme Court pursuant to section 84 of the Property Law Act 1958.
Section 84 of the Property Law Act 1958 gives the Supreme Court of Victoria the power, upon the
application of any person interested in any land affected by a Restrictive Covenant, to wholly or
partially discharge or modify the restriction.
The Supreme Court is required to be satisfied that:
a) The restrictive covenant is obsolete or its continued existence would impede the
reasonable use of the land;
b) All persons benefitting from the covenant have agreed (whether expressly or by
implication by their acts of omissions) to the variation or removal;
c) The variation or removal of the covenant will not substantially injure any persons entitled
to the benefit of the covenant.
These are narrow legal criteria which do not take wider planning issues into account.
This process is expensive and is only available to persons having a legal interest in the land affected
by the covenant.
2.
Application for a Planning Permit to Vary or Remove a Restrictive Covenant.
An application for a planning permit can be made to Council under Section 60(5) of the Planning and
Environment Act 1987 to remove or vary a restrictive covenant created before 25 June 1991. This
section of the Act provides that a responsible authority must not permit the removal or variation of a
restrictive covenant unless it is satisfied that:
a) The owner of any land benefitted by the restriction (other than an owner who, before or
after the making of the application for the permit but not more than three months before its
making, has consented in writing to the grant of the permit) will be unlikely to suffer
detriment of any kind (including perceived detriment) as a consequence of the removal or
variation of the restriction, and
b) If that owner has objected, the objection is vexatious or not made in good faith.
This effectively means that where a bona fide objection is made by an owner of any land benefitted
by the covenant claiming any detriment (including perceived detriment), a planning permit for removal
or variation of a covenant cannot be granted by the responsible authority.
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In addition to the above, restrictive covenants created after 25 June 1991 are governed by Section
60(2) of the Planning and Environment Act 1987. In determining whether or not to grant a planning
permit, a responsible authority must also be satisfied that an owner of any land benefitted by the
covenant will be unlikely to suffer a)
b)
c)
d)
financial loss; or
loss of amenity; or
loss arising from change to the character of the neighbourhood; or
any other material detriment
as a consequence of the removal or variation of the restriction.
Information required to be provided with an application for a planning permit to remove or vary a
Restrictive Covenant is as follows:
1. A planning permit application form and fee.
2. A copy of the original Parent Title from which all land in the original subdivision (including the
applicant property) was created.
3. A copy of the original Plan of Subdivision.
4. A copy of the applicant Title and the Instrument of Transfer in which the covenant was
created.
5. Copies of all of the current Titles of lots from the original Plan of Subdivision which benefit
from the covenant (all searches must be less than 28 days old).
6. Copies of all original Transfers of Land issued for the lots created in the original subdivision.
7. A letter from a suitably qualified professional in the field of property law, identifying which
properties within the Plan of Subdivision benefit from the Covenant (the Law Institute of
Victoria can supply a list of accredited property law specialists).
8. Details of the practical benefits arising from the removal or variation of the Covenant;
9. Details of how the removal or variation of the Covenant will not cause detriment of any kind to
a beneficiary of the Covenant;
10. For covenants created after 25 June 1991, whether the removal or variation of the Covenant
will be likely to cause financial loss, loss of amenity, loss arising from change to the character
of the neighbourhood or any other material detriment to a beneficiary of the Covenant.
11. Changes which have occurred in the character of the neighbourhood and the circumstances
which impact on the relevance of the Covenant.
12. Whether the application can be supported by local or state government planning policy set out
in the Boroondara Planning Scheme and if so, in what way.
13. Whether the application is consistent with a strategic framework plan for the area or the
municipality.
These criteria are not exhaustive and applicants should include any other information considered
necessary. Applications should also have regard to this policy and the Residential Urban Character
Study.
Notification
Pursuant to Section 52(1AA) of the Act, a planning permit application to alter or remove a covenant
will be advertised by notices in relevant newspapers, signs on the property and letters to all
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beneficiaries. In some cases where a covenant has been in breach for more than two years, Section
52 of the Act does not apply and notification is not required (see section 47(2) of the Act).
Assessment of an application for a Planning Permit to remove or vary a Covenant
In the case of covenants created before 25 June 1991, if any beneficiary of the Covenant makes a
bona fide objection to the Council, claiming any detriment, including perceived detriment, Council
must, by law, refuse the application for a planning permit.
If no bona fide objections are received, Council must consider the removal or variation of the
Covenant on its merits against both local and state policy. Matters to be considered include:









In the case of single dwelling covenants, Council's Single Dwelling Covenant Policy
Statement (which appears below at Section 3).
Whether the removal or variation of the Covenant will be likely to cause any loss
arising from change to the character of the neighbourhood. Considerations would
include:
o Loss of vegetation;
o Change in prevailing building form including roofline;
o Difference in building height;
o Use of different materials;
o Change to prevailing setbacks, including the front setback;
o Reduction in open space;
o Increase in site coverage and loss of permeable surface.
Whether the removal or variation of the Covenant will adversely impact any other
person.
Whether the removal or variation of the Covenant will be likely to cause loss of
amenity. Considerations may include:
o Noise;
o Loss of privacy;
o Overshadowing;
o Building bulk;
o Increase in traffic;
o Loss of availability of on-street parking;
o Loss of views.
Changes which have occurred in the character of the neighbourhood and the
circumstances which impact on the relevance of the Covenant.
Whether the removal or variation of the Covenant will benefit the community.
Whether the application can be supported by local or state government policy set out
in the Boroondara Planning Scheme and if so, in what way.
Whether the application is consistent with a strategic framework plan for the area or
the municipality.
Whether the removal or variation of the Covenant creates an undesirable precedent.
In assessing applications to vary or remove covenants created after 25 June 1991 the above matters
are relevant considerations, as well as the likelihood of financial loss. Potential financial loss is
difficult to assess, however a valuer's statement may be of assistance.
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3. Application for a Planning Scheme Amendment
Section 6(2)(g) of the Planning and Environment Act 1987 enables Restrictive Covenants to be
varied or removed via a planning scheme amendment which results in a site specific control being
inserted into the Planning Scheme, overriding the effect of the Restrictive Covenant.
This process can be used when:
a) Unanimous agreement with the beneficiaries on the removal or variation of a Restrictive
Covenant cannot be obtained;
b) The person seeking to vary or remove a Restrictive Covenant does not have a legal
interest in the land; and
c) The Covenant is not obsolete but wider planning objectives would be served by the
removal or variation.
The planning scheme amendment process has a wider strategic consideration than the planning
permit process and is not limited to consideration of planning permit issues. It places significant
emphasis on planning policy, both at the local and state levels. It often requires an examination of
wider patterns of existing land use and the principal attributes of such land. It involves an
examination of the balance of land uses, which is an assessment of competing interests of the
community to require a site to stay in its present zone, or alternatively place the site in another zone,
or make it subject to different controls where a different community need is to be met.
It is imperative that the relevant planning considerations be considered in the context of contractual
property rights and obligations arising from restrictive covenants. This involves a consideration of
what weight is to be accorded to restrictive covenants in relation to planning considerations such as
land use, amenity, local and metropolitan policy, amongst others.
Generally Planning Panels considering submissions on planning scheme amendments have been of
the view that the starting point is not to decide that a development is acceptable in planning terms,
but that private proprietary rights will only be abrogated where a substantial and overriding
community benefit is to be achieved.
There may be circumstances where the need to give effect to planning policy outweighs the intended
purpose of a covenant. In addition, community benefit may, in some circumstances, outweigh
individual benefit.
In most circumstances, a variation rather than the removal of a restrictive covenant should be sought
as a variation results in a narrower expansion of development rights than a total removal, which could
potentially allow any sort of development permitted by the planning scheme.
Section 6(2)(g) of the Planning and Environment Act 1987 specifically provides planning schemes
with power to abrogate the rights of servient and dominant tenements, but does not specify how this
power is to be used.
Planning Panels have used the following criteria to assess restrictive covenant proposals for
amendments to planning schemes, and it is considered that for the purposes of assessment of
applications by Council, the same criteria could be used:
1. The purpose of the original restrictive covenant.
2. Determination of the practical benefits of the covenant.
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3. Changes which have occurred in the character of the neighbourhood and the
circumstances which impact on the relevance of the covenant.
4. Whether the removal of the covenant would give rise to a detrimental impact on the
amenity of the surrounding area.
5. Whether the maintenance of the covenant is consistent with planning policy.
6. Whether the proposed use and development is a reasonable use of the land.
7. Whether the removal of the covenant creates an undesirable precedent.
Council would also have regard to this policy and Residential Urban Character Study.
Information to be provided with an application for a Planning Scheme Amendment includes:
1. A history of the sequence of the subdivision which gave rise to the Restrictive Covenant. This
will assist in determining the dominant or servient tenements who may be affected by the
application (a legal opinion as to those properties which do and do not benefit from the
subdivision is generally necessary). Specific documents to be supplied include:
 A copy of the original Parent Title from which all land in the subdivision (including the
applicant property) was created.
 A copy of the original Plan of Subdivision.
 Copies of all the Titles of lots in the original Plan of Subdivision.
 Copies of all original Transfers of Land issued for all lots in the relevant Plan of
Subdivision.
2. Details of the practical benefits arising from the removal or variation of the Covenant.
3. Details of how the removal or variation of the Covenant will adversely impact on any other
person.
4. Whether the removal or variation of the Covenant will be likely to cause financial loss, loss of
amenity, loss arising from change to the character of the neighbourhood or any other material
detriment.
5. Changes which have occurred in the character of the neighbourhood and the circumstances
which impact on the relevant of the Covenant.
6. How the removal or variation of the Restrictive Covenant will benefit the community.
7. Whether the removal or variation of the covenant will give rise to a detrimental impact on the
amenity of the surrounding area.
8. Whether the application can be supported by local or state government policy in the
Boroondara Planning Scheme and if so, in what way.
9. Whether the application is consistent with an overall strategic framework plan for the area or
the municipality.
10. Whether the removal or variation of the Covenant creates an undesirable precedent.
As with the planning permit process, the amendment process will also be subject to advertising
procedures and will include advertisements in relevant newspapers, signs on the property and letters
to all beneficiaries. If sufficient information on beneficiaries is not provided, all properties affected by
the original Plan of Subdivision will be notified.
These criteria are not exhaustive and applications should include any other information the applicant
considers to be necessary. As with the planning permit process, due regard must be given to all
relevant Council policies.
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2.1. Context
Single Dwelling Covenants, although an agreement between private landowners, have had a role in
the formation of the urban form and character of many areas of this City. Often included to create a
particular type of character, covenants (and equivalent mechanisms) are still used today by land
developers in new residential estates and subdivisions to achieve similar outcomes.
2.2. Corporate framework
This policy supports Council’s Mission and Vision by addressing the following objective in the Council
Plan 2010 - 2015:

Ensuring Liveability and Amenity
Municipal Strategic Statement
The Strategic Objectives relevant to this policy are:
Heritage, Landscapes and Urban Character:

The conservation and enhancement of the City's characteristic built environment.
Residential Land Use

The maintenance and enhancement of the City's present degree of residential amenity and
high standard of residential development.
3. Policy statement
Council acknowledges the role of single dwelling covenants in shaping the character of
neighbourhoods and considers that the existence of a single dwelling covenant is a major issue when
considering multi-dwelling applications on land affected by a covenant. Council recognises the major
role that single dwelling covenants have played and continue to play in establishing and maintaining
the character and amenity of an area. Council recognises that there may be circumstances where
the variation or removal may be appropriate because it is redundant, there is no objection and the
variation or removal of the single dwelling covenant would be consistent with Council's strategic
policies.
Strategic Objective 1
Council will discourage the removal or variation of single dwelling covenants unless:
a)
b)
c)
d)
The single dwelling covenant is 'dead wood' in nature;
No beneficiary to that single dwelling covenant reasonably objects;
No beneficiary is likely to suffer any detriment, including perceived detriment;
For those covenants created after 25 June 1991, there will be no financial loss, loss of
amenity, loss arising from change of character to the area or any other material detriment;
and
e) The variation or removal of the single dwelling covenant would be consistent with broader
strategic planning objectives of Council as set out in the Municipal Strategic Statement.
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Strategic Objective 2
In the event that an application is made for a multi-dwelling proposal on land affected by a single
dwelling covenant, Council strongly advises applicants to simultaneously, either as part of the same
application, or via a separate application, apply to vary or remove the said covenant so that all
matters relevant to the proposal and the covenant are considered together.
It is policy that where applications for multi-dwellings are on land affected by a single dwelling
covenant, the contribution to the character of the area made by the existence of the covenant be
considered expressly in conjunction with the considerations under Standard B1 - Neighbourhood
Character - of ResCode.
It is noted that Council will require the advertising of proposals to remove or vary single dwelling
covenants by certified mail.
4. Implementation and monitoring
4.1. Accountabilities
For all queries or feedback regarding this policy document, please contact the responsible
department below.
Contact
Contact number
Statutory Planning Department
9278 4888
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5. References
5.1. Related documents
Planning and Environment Act 1987
Restrictive Covenant Information Sheet (2009)
5.2. Definitions
Restrictive Covenant
A private legal agreement between a land owner and purchaser that is registered on the Certificate of
Title.
Legal Beneficiary
Anyone who has benefit of a restrictive covenant and is able to enforce the restrictions of a covenant
through the Supreme Court.
Planning Scheme
A legal document that sets out the framework against which planning permits are assessed. It is
made up of policies and controls for the way land may be used and what development is appropriate.
All municipalities in Victoria have a planning scheme.
Planning Permit
A legal document that gives permission for a use or development on a particular site.
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