Review of Victoria’s Property Laws

These are the slides from a talk given by Associate Professor Pamela O’Connor, VLRC Commissioner, to the Law Institute of Victoria, the Surveying Institute and the Planning Institute on 17 August 2010.

Review of Victoria’s Property Laws

  • Referred by the Attorney-General in August 2009
  • Two stages:
    • Review of Property Law Act 1958 and law of easements and covenants (currently underway)
    • Review of aspects of the Transfer of Land Act 1958 (terms of reference yet to be determined)

First stage

  • The desirability of changes to Victoria’s property laws in relation to:
    • The Property Law Act 1958
    • Easements and covenants
  • The purpose of the review is to ensure that the laws under review are transparent, accessible and support an efficient and effective system of property rights and transactions in Victoria
  • In particular consider:
    • Any necessary changes to ensure that the Property Law Act 1958 is certain, effective and up to date…
    • The operation of the law of easements and covenants broadly, and any beneficial changes to streamline planning processes and/or relevant property laws and practices, as well as options to facilitate simpler and cheaper processes…

Process of review

  • Drafting of Consultation Paper
    • Outline current law and the reasons for it
    • Literature review
    • Identify problems and issues
    • Formulate reform options/proposals
    • Ask questions and invite submissions
  • Drafting of final report
    • Examine and summarise submissions
    • Evaluate evidence and arguments
    • Formulate recommendations and write report

Review of Property Law Act 1958

  • Consultation paper released April 2010
  • Submissions closed
  • Final report due 30 September 2010

Mistaken improver relief provision

  • Chattels attached to land for purpose of permanent improvement become part of the land – ‘fixtures’
  • Fixtures rule can cause hardship for those who make permanent improvements to land under a genuine mistake as to the identity of the land or its ownership, eg
    • Contractor installs water tank on wrong lot
    • Improver’s title to land is defeated by a better claim
  • Court can let improver recover their materials, or order the landowner to pay compensation for retaining them

Building encroachment relief provision

  • A building encroachment is a building, overhang or footings extending across a boundary line from the ‘encroaching owner’s’ lot onto the ‘adjacent owner’s’ lot
  • Relief provision gives court power to make various orders including removal of encroachment or adjustment of boundary subject to payment of compensation
  • Provision can co-exist with part-parcel adverse possession eg WA 

Law of easements and covenants

  • Consultation paper released July 2010
  • 34 questions asked
  • Submissions due by 30 September 2010
  • Final report due 17 December 2010 


  • Simplified rules for implied easements
  • Easements created by 20 years use
  • Court imposed easements
  • Removal of right of way under s 36 of the Subdivision Act
  • New provision for removal/variation by court order

The role of covenants

  • What types of covenants are made in Victoria?
  • What is their frequency and distribution?
  • How do covenants affect the outcomes of public planning?
  • Should covenants be a relevant consideration in planning decisions?
  • Is there a role for covenants in an era of public planning and if so, what is it?

Restrictive and positive covenants

Restrictive covenants

  • Restrict the use of the land, eg
    • Covenants imposing setback, height or land use restrictions
  • Can run with land only if recorded

Positive covenants

  • Require payment of money or performance of a duty, eg
    • Covenants to keep buildings in repair
  • Positive covenants between private parties do not run with land (even if recorded). They are enforceable only in contract.

Positive obligations

  • There is a need to impose positive obligations on current and future lot owners in common property developments
  • Existing provisions:
    • Subdivision Act Part V
    • Owners Corporations Act
    • Section 173 planning agreements (Planning and Environment Act)
  • Is further provision needed?

Removal of covenants

  • Should covenants be subject to a statutory sunset provision?
  • Should the provisions for removal of covenants by planning permit be amended?
  • Should courts be directed to take planning policies and decisions into account in applications for removal or variation of covenant?

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