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Crown land: Navigating a new world

Crown land: Navigating a new world

By Lauren Walley

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Sitting outside the Torrens title system, Crown land is governed by its own legislation and practices, including for titling, management, sales, leasing, restricted land use and subdivision.

Snapshot
  • Thirty five per cent of Victoria has Crown land status which is used for a range of public purposes – from forests to prisons.
  • Crown land is administered by its own legislation and practices separate to the Torrens system, including for titling, management, sales, leasing, restricted land use and subdivision.
  • When dealing with Crown land, lawyers and conveyancers should give careful attention to its unique processes and requirements, including those mandated in Victorian government policies.

When dealing with Crown land, ignore nearly everything you think you know about the practice of land law and conveyancing. At nearly 8 million hectares, 35 per cent of Victoria has Crown land status, much of which is national park and state forest.1 Wholly outside the Torrens title system, Crown land has its own set of legislation and practices.

What is Crown land?

All land in Victoria is either freehold land (Torrens land or general law land) or Crown land. Crown land is all land that has not been “alienated” from the Crown.3 Crown land is used for a range of public purposes including forests, cemeteries, coastal foreshores, waterway beds and banks, railways, schools, hospitals, prisons and sporting facilities.

Crown folios 

From 2016, Land Use Victoria, in the Department of Environment, Land, Water and Planning (DELWP), has assigned a unique volume and folio reference for each Crown land allotment to provide a consistent recording system for all land parcels in Victoria. However, as Crown land is administered outside the Torrens Register, no Certificates of Title are issued. A Crown diagram is also prepared in a similar format to title plans.

Responsibility

Crown land is owned by the “Crown in right of the State of Victoria”. DELWP and Parks Victoria have responsibility for managing most Crown land. In practice, Crown land is informally occupied and managed by departments and agencies across the Victorian government in many instances. DELWP will typically look to that occupant body to perform compliance activities and bear any costs and liabilities.

Instead of a registered proprietor, the Crown Folio Statement will note a Crown Land Administrator that occupies and manages the land. The notation is purely administrative, not being a legislative concept, and has no legal effect. The principles of indefeasible title do not apply. By default, the Crown folio lists the administrator as the “Secretary to the Department of Environment, Land, Water and Planning”. This notation is not always updated. It will also not show if a committee of management has been appointed (as discussed below).

Encumbrances

On purchase for use as Crown land, private land becomes Crown land freed and discharged of all estates, interests, trusts, encumbrances, limitations and restrictions (Land Act 1958 (Vic) (Land Act), s4A(3)).4 In practice, existing encumbrances, such as drainage easements, are retained on DELWP's records and later reinstated if a new freehold Crown grant is issued. Dealings with such interests are managed by the Applications and Survey Branch of Land Use Victoria through their own set of informal forms outside the Torrens conveyancing system. 

Surrendering freehold land 

Freehold land can be converted back to Crown land by surrendering the land to Her Majesty Queen Elizabeth II using a transfer of land instrument. For non-government landholders, this should only be done with DELWP's prior consent.

Reservations

The key mechanism for restricting land use is to permanently or temporarily reserve Crown land for any public purposes under the Crown Land (Reserves) Act 1978 (Vic) (Crown Land (Reserves) Act).5 For reserved Crown land, the Act voids any sale, lease or licence that is not made consistent with the Act subject to a few exceptions (s8). Section 4 provides a non-exhaustive list of reservation purposes, but the land may simply be reserved for “public purposes”. Unreserved Crown land is generally governed by the Land Act.

Typically, temporary and permanent reservations are established by an Order of the Governor in Council published in the Victoria Government Gazette (Gazette).6 However, some legislation may automatically deem land to be Crown land temporarily or permanently reserved under the Crown Land (Reserves) Act for the purpose for which it was acquired.7

The key difference is that temporary reservations are revoked by an Order of the Governor in Council published in the Gazette (s10).8 However, an Act of Parliament is required to revoke a permanent reservation, with a few exceptions (s9(2)).

Committees of management

The Minister may appoint a committee of management to “manage, improve, maintain and control” the land for its reservation purposes (ss14 and 15).10 The Minister may revoke the appointment at any time. These appointments and revocations are not published unless they are made in specific legislation. These signed orders are currently held in a paper file at the local DELWP regional office. DELWP is currently undertaking a long-term project to digitise and verify these records into a central database. Employees of the Victorian Public Service can access the data at www.govmap.land.vic.gov.au. 

Committees of management are primarily groups of three or more people (s14(4)(a)).11 Many groups are appointed from local people passionate about caring for their local reserves. DELWP monitors and supports these committees, including through the “Committee of Management Guidelines” and the new Crown Land Information Platform. Municipal councils, water corporations, Parks Victoria, Victorian statutory bodies and certain registered companies limited by guarantee are also eligible for appointment, but sit outside this compliance and support framework (s14(4)). 

Trustees and restricted Crown Grants

In rare circumstances, permanently reserved Crown land may be granted to trustees as a restricted Crown Grant. These trustees are appointed by an Order in Council published in the Gazette (s12). The land will appear as freehold land with a Certificate of Title, and the trustees are deemed to be registered proprietors of the land. However, the trustees and the Crown land are still subject to the restrictions applicable under the Crown Land (Reserves) Act. This restriction is usually, but not always, recorded as a caveat on the title by the Registrar of Titles on behalf of the Crown under s106(1)(a) of the Transfer of Land Act 1958 (Vic). Particularly when dealing with public hospitals or premises granted to an Aboriginal corporation, a historic title search should be ordered to check the terms of the original Crown Grant for restrictions on use, sale or other dealings.

Selling Crown land

Crown land is sold under a unique process set out in Division 6 of Part 1 of the Land Act. The Assistant Treasurer is the Minister responsible for the sale and alienation of Crown lands, as managed by the Land and Property Group, Commercial Division of the Department of Treasury and Finance.12

Before Crown land is transacted, the Victorian Government Strategic Crown Land Assessment Policy and Guidelines - April 2016 require a surplus Crown land assessment to be performed.13 This determines if the land is surplus to the government's current and operational requirements. This exercise is performed by the state entity that currently manages the land, which prepares a written declaration confirming that the land is surplus to requirements. Before being listed for public sale, surplus land must be offered to all Victorian government bodies, local government and the Commonwealth government through a “first right of refusal” process, in that order of preference. If this process is not successful, a strategic Crown land assessment must then be undertaken by DELWP to determine if the land should be alienated and, if so, what appropriate protections are in place to preserve any public land values, also identifying the implications for, and impact on, traditional owners. Some exceptions exist to all or part of this process, as stated in the policies. 

The terms of the Contract of Sale must comply with the Victorian Government Land Transactions Policy and Guidelines - April 2016. The price must be no less than the current market value determined by the Valuer-General Victoria unless an exemption applies. All sale transactions with a value of $750,000 or more (excluding GST) must be reviewed by the Victorian Government Land Monitor which "provides government with an assurance of integrity, impartiality and accountability in land transactions".14 Any reservation of the land must first be revoked (s89(2)). When the purchaser has complied with all conditions of sale, the Governor in Council must grant the land to the purchaser in fee simple, so converting it to private land under the Torrens title system (s95). 

Leasing Crown land

Crown land can only be leased under a specific leasing power in the Crown Land (Reserves) Act if reserved land (s8), or the Land Act if unreserved land. Other Acts may authorise leasing Crown land if they expressly authorise it (s8).

For reserved Crown land, most leases are granted under s17D by either the appointed trustee or committee of management with the approval of the responsible Minister, or the responsible Minister directly. The term of the lease can be up to 21 years including any further terms (s17F). The lease can be granted for any purpose as long as it is not detrimental to the reservation purpose (s17D(3)(b)). A committee of management can only spend any revenue collected, including rent, on maintaining the land unless otherwise directed by the Minister (s15(1)(e)). Alternatively, s17CA authorises the responsible Minister to grant a lease for up to 65 years if the Minister is satisfied that it is not detrimental to the reservation purpose, the proposed development or works are substantial and sufficiently valuable to justify the longer time, and it is in the public interest.

For unreserved Crown land, the Minister may grant a lease under s134. The term of the lease can be up to 21 years, but can be up to 50 years if it is granted for commercial or industrial purposes, or up to 99 years for substantial works (s137AA). If privately negotiated, the proposed tenant must publish notice in the Gazette and a local newspaper at least 14 days prior to entering the lease (s137).

Under both Acts, the maximum overholding period is three months. As required by government policy, the lease terms and conditions must be issued in the form of the Crown Lease managed by DELWP with any departures recorded in an annexure, and in accordance with DELWP's Leasing policy for Victorian Crown land – May 2018. In compliance with the Victorian Government Land Transactions Policy and Guidelines – April 2016, the rent applicable must not be less than the current market rent determined by the Valuer-General Victoria, unless an exemption applies.15 

Subdividing Crown land

The Office of the Surveyor-General Victoria, which sits within Land Use Victoria, manages all Crown Survey approvals, including subdivision and consolidation of Crown Allotments. This is a separate scheme to the “standard” subdivision process, as the Subdivision Act 1988 does not apply to Crown land. There is no requirement to go through the planning scheme and permit process with the responsible authority. 

Conclusion

Any dealings with Crown land require careful attention to its distinctive requirements, which help protect these substantial Crown assets for the benefit of Victorians into the future. ■


Lauren ​Walley is a senior solicitor at the Victorian Government Solicitor's Office. She practises in property and commercial law.

  1. See DELWP, Leasing Policy for Victorian Crown Land 2018, 3.1.
  2. Other Victorian legislation for specific areas includes the Conservation Forests and Lands Act 1987, Forests Act 1958, Alpine Resorts (Management) Act 1997 and Coastal Management Act 1995.
  3. Ministers, departmental secretaries, and public statutory authorities can, and often are, the registered proprietors of freehold land.
  4. Similarly, adverse possession is deemed to have no effect with respect to Crown land: Limitation of Actions Act 1958 (Vic), s7.
  5. Common land restriction tools such as the planning scheme and s173 agreements are also applicable to Crown land, but not restrictive covenants.
  6. For permanent reservations, notice of the proposed reservation must also be published in a newspaper circulating generally in that area at least 30 days prior to the reservation: Crown Land (Reserves) Act, s4(2).
  7. Eg Cemeteries and Crematoria Act 2003 (Vic), s34.
  8. At least 14 days prior, notice of the intention to revoke the reservation must also be published in the Gazette.
  9. Eg Development Victoria Act 2003 (Vic), s45.
  10. The Premier’s General Order for the Administration of Acts currently lists this as the Minister for Energy, Environment and Climate Change. However, other Ministers hold the Minister's powers under this Act with respect to specific Crown Allotments.
  11. This committee can also be incorporated by Order of the Governor in Council through publication in the Gazette, which gives added protection and powers to the committee: s14A.
  12. DELWP has an agreement with this department that permits DELWP to manage the sale of Crown land with a market value of less than $100,000.
  13. The Victorian government policies and guidelines do not have the force of law. However, all parts of the Victorian Public Sector as expected to comply with them, unless expressly excepted.
  14. See Victorian Government Land Transactions Policy and Guidelines, April 2016.
  15. The Victorian Government Land Monitor does not consider leases unless the lease grants an option to purchase the land.

 


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