Council appeals developer’s $4m compensation claim
COFFS Harbour City Council has successfully appealed a court decision that ruled it owed more than $4 million in compensation to the developers of a local housing estate.
The council’s appeal of the Land and Environment Court decision was upheld in the Court of Appeal last week.
Noubia, the developers of The Lakes Estate, had taken the council to court in 2017 claiming it was not complying with an agreement to pay compensation for the transfer of three lots of land as outlined in its modified Development Application.
The Lakes Estate which forms part of the North Boambee Valley is located in a flood plain.
The council had agreed to pay $110,000 for each of two lots, but denied liability to pay compensation for the third.
Court documents reveal the council argued it was entitled to acquire the third lot “free of cost” from Noubia as a development contribution.
In the Land and Environment Court proceedings Noubia sought valuation declarations, and the primary judge made the orders that two of the lots were valued at $3,816,000, and that compensation was payable for the third lot at an agreed value.
The basis for this valuation was a hypothetical development from Noubia which would have allowed for a further 35 residential dwellings on the first two lots at a net value of over $100,000 per lot - constituting the $3.8m claimed.
However, court documents state the proposed development dealt only with water emanating from Noubia’s own hypothetical development.
The Court of Appeal determined there was “substantial” evidence that the council would not actually approve a development that did not include a scheme for the detention and management of upstream water flows onto the land.
Council had appealed that the trial judge therefore had erred in assessing the value of the three lots.
The court upheld the appeal and determined that the trial judge’s valuation of the first two lots miscarried.
The court also determined Noubia’s hypothetical development failed to take into account the management of upstream water onto the land, and that the council was not obliged to pay compensation for the third lot.
The matter was remitted to the Land and Environment Court for assessment of the compensation payable by the council to Noubia in respect of the first two lots.
Noubia must now pay the council’s costs in the Court of Appeal.