Mornington Peninsula Shire councillors knocked back the proposal on August 16 so the developer, Barkly Street Enterprises, which is part of the Gillon Group, took it to the VCAT with a full hearing set for September 20 and 21.

Shire planners had earlier recommended the proposal be approved, but councillors led by Cr Anne Shaw overturned the advice.

As we reported last July, the East Bentleigh-based developer wants to build 119 units, including 12 two-storey townhouses, either side of Pearson Street, which connects the school with Barkly Street in the north.

Gillon Group is owned by Peter Gillon of Brighton, a former Olympic rower, champion yachtsman and property developer. The school was founded in 1878 and the street has been used by generations of pupils to walk to school. More recently, it has been a safe haven for parents in cars during drop-off and pick-up times as the street ends at the school.

Principal Silvio Vitale has taken a leading role in objecting to the proposal and fronted the tribunal on Monday as a representative of the education department, backed up by lawyers from the Government Solicitor's Office.

He argued the development was not in a suitable location as it would negatively impact on the school.

"The proposal has costs me and the school council a lot of time over the last year or more," he told the Weekly. "I'm going in to bat for the interest of the school in the long term."

Gillon wants to build a new road connecting the school end of Pearson Street with the Eastern Ring Road at a new roundabout.

The school community is worried about pupils having to cross the new road.

The VCAT cannot decide to close Pearson Street as this is a decision of the shire, which in March started the process to close it.

Joining the school in objecting to the development and street closure is the Mornington Environment Association.

Last year, Mornington MP David Morris said the plan was a "gross overdevelopment" and it would "dwarf the surrounding buildings and the nearby historic primary school".