Gold Coast City Council wins Supreme Court appeal to make Sunland liable for $20m in infrastructure charges plus costs

A key Gold Coast developer is back on the hook for $20 million in council infrastructure charges it claimed were wrongly applied to an $850 million project.

Aerial of the $850 million masterplanned community The Lakes being developed by the Sunland Group

LISTED developer Sunland has lost a court action over almost $20 million in council infrastructure charges it claimed were wrongly applied to its $850 million project at Mermaid Waters.

However, the fight is not over, with multiple other court actions still in play over the same issue.

In May last year, 16 months into the stoush, the Planning and Environment Court ruled Gold Coast City Council had incorrectly charged Sunland fees for its development at The Lakes.

Judge Nicole Kefford ruled five bills sent by the council to the developer were not valid and that none of them complied with the Sustainable Planning Act.

The judge found the infrastructure charges notices did not adequately state why Sunland was being charged and accepted none of the council’s six legal arguments for omitting specific reasons for the fees, which the developer has already paid.

Sunland Group is developing The Lakes project at Mermaid Waters

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The council submitted the developer was “seeking to circumvent” the appeals process by taking the matter to court, an argument which was also rejected at the time.

Sunland and the council have each lodged various overlapping court actions — civil, planning and monies-owing — over the same issue, with the first lodged by the developer in December 2016.

In the latest decision, published June 14 after a Supreme Court hearing in November, Judges Hugh Fraser, Nancy Morrison and Graeme Crow sided with the council, allowing its appeal against the Planning and Environment Court ruling.

The new judgment said Judge Kefford was mistaken in the initial ruling that the documents did not comply with the Act.

They agreed with the council’s submission that the case had implications for councils across Queensland as it highlighted uncertainty around whether an amendment to the Act, made in 2016, should be retrospectively applied to cases which had already been through the courts.

Sunland managing director Sahba Abedian. Photo: Richard Gosling

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Sunland has argued a previous development on the 42ha site, named Lakeview at Mermaid, was approved by a court in May 5, 2007, an approval that was extended in 2011 until May 2017.

Sunland bought the site for $61 million in 2015, with that preliminary development approval still in place, on the understanding that charges paid by the previous developer would be credited for future comparable developments.

The developer submitted they had reached the understanding based on information from a council officer, provided before they purchased the site.

In February, Sunland said it would take a more conservative approach in the coming year after a softening property market and a drastic writedown on a major project left it likely to fall short of its $27-$30 million profit guidance for the financial year.