Council forced to repay millions after up-market canal estates win landmark class action

Residents of ritzy canal estates near Brisbane hope a landmark Supreme Court victory over a decade of invalid council charges leads to more government “transparency and accountability”.

Revetment walls on Sovereign Waters are maintained by Redland City Council which had charged residents a special levy.

Residents living in ritzy canal estates have won a landmark Supreme Court class action against a southside council.

In a historic decision, bayside’s Redland City Council has been ordered to repay millions of dollars to canal estate owners who have been slugged thousands of dollars in council levies over a decade.

Residents banded together and took the matter to court after being charged about $750 a year by the council, which said it used the funds to maintain canal walls in the exclusive Raby Bay, Aquatic Paradise and Sovereign Waters estates.

Raby Bay residents have won a historic Supreme Court battle over council charges.

Ratepayers from Raby Bay filed a claim against Redland City Council in October 2018 after the council advised that the canal maintenance levy was invalid.

The council sent 1650 ratepayers a refund after ceasing the levy in 2017.

But Cleveland residents Simon and Sarah Akero said the $104 council refund sent to them was a joke and Shine Lawyers commenced proceedings to recover the remaining amount, which Mr Akero estimated totalled more than $12,000 for his property.

Simon and Sarah Akero with their daughter on the water’s edge at their Sovereign Waters property, where they have been charged a special levy by council for maintenance of the revetment wall.

Shine Lawyers, who conducted the class action for 1055 members, said $7,782,556.82 was levied over the period and $3,791,536.80, plus interest remained owed.

“Having lived on the lake for 20 years, I was disappointed that Redland City Council continually charged a lake levy without providing any transparency on what the collected funds were used for,” Mr Akero said.

“Transparency and accountability are a crucial element, particularly when it comes to government bodies.

“With the judgment made by the Supreme Court, I am pleased that the spotlight has been put on this matter, with a successful result.

“This will make councils think about what they’re asking residents for, and will ensure that there is accountability for every dollar asked of us in future.

“Residents have taken back some control over special levies imposed by the council and I hope the council will implement some changes to be more transparent.”

This week’s court ruling related to special charges made to the council between July 2011 and July 2017.

The council said it was disappointed with the Supreme Court decision and was investigating an appeal.

A typical quarterly Redland Council rates bill for a Sovereign Waters Estate property in 2018.

Redland City Council chief executive Andrew Chesterman said the judgment was unreasonable, as the class action would benefit ratepayers twice.

Mr Chesterman said the ratepayers won the refund on “a legal technicality”, even though he said the council had a right to impose a special charge for canal works and maintenance.

“Over years, the council has spent many millions on revetment walls and dredging in these canal estates,” Mr Chesterman said.

“Given we have spent the money in these canals and the lake, we strongly defended not refunding these spent funds as it means the rest of the community has to pay for the work that ultimately benefits the residents of these canal estates.

“Funds were collected from canal and lakefront ratepayers in good faith and spent on maintenance work on those same properties.

“Importantly, the court accepted that the council performed the canal and lake maintenance funded by the charges to ratepayers.

“We don’t think it is right that the rest of the community has to pick up this bill and we are looking at all appeal options,” Mr Chesterman said.

This week’s ruling will only apply to those who joined the class action and paid the levy from 2011 to 2017.

A Redland City Council letter in 2018 to ratepayers informing them the special canal levy would cease.

The class action, funded by Augusta Ventures, was the first to be won in the Queensland Supreme Court and the class action to be heard in the state.

But not all canal and lakeside ratepayers will receive the court-sanctioned rebate with up to 652 ratepayers opting out of joining the class action.

Shine Lawyers’ special counsel Tristan Gaven said 1650 canal and lakefront property owners were owed a full refund for the invalidly raised levies but 1055 members had signed up for the class action.

“People can still sign up and need to contact Shine Lawyers if they have changed their contact details,” Mr Gaven said.

“To be eligible to join the class action, you must have lived in the Redland local government area and been subject to a special levy in relation to canal and waterways maintenance including marina special charges in the period from 2011 to 2017.”

The levy varied depending on the property and its location and the refund will vary depending on how many years the resident had lived at the address with an average claim of about $1500.