Gold Coast City Council wrongly charged Sunland almost $20 million over The Lakes project

GOLD Coast City Council incorrectly charged a major developer almost $20 million in fees for its $850 million Mermaid Waters development. Here’s how.

THE Planning and Environment Court has found Gold Coast City Council incorrectly charged Sunland almost $20 million in development fees for its $850 million project The Lakes at Mermaid Waters.

Judge Nicole Kefford ruled five bills sent by the council to Sunland were not valid infrastructure charges notices and that none of the documents complied with the Sustainable Planning Act.

The Lakes.

The judge tore apart the council’s arguments that the notices were valid, finding they did not adequately state why Sunland was being charged.

The council yesterday said they had lodged a new appeal against the decision but would not answer questions on how much the legal actions, which commenced in 2016, had cost ratepayers, saying it was “commercial in confidence”.

“As this matter is before the courts it would be inappropriate to comment further,” a statement from the media department said.

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The Lakes Residences in Mermaid Waters.

In Sunland’s appeal, initially lodged by Hickey Lawyers, but then transferred to Holding Redlich, said a previous development on the 42ha site, 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 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.

Sunland’s submission said the council’s then-supervisor of development contributions, David Lohoar, had confirmed in writing that fees already paid on the land could be used to offset charges “for all future development approvals” applied for under the preliminary approval gained by the previous developer.

The submission said the council provided the assurance knowing Sunland would rely on it when making a decision on whether or not to buy the land.

Sunland put the land under contract a month later, with the $61 million sale settling in May 2015.

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The Lakeview project which was previously approved for the site. Photo: Supplied

Sunland said their subsequent development applications for the site were “under the umbrella of the preliminary approval” and that the council should have taken the infrastructure credits into account.

However the council issued five documents titled “infrastructure charges notice” that did not take the credits “that exceeded $19 million” into account.

Sunland’s submission also said the notices were invalid because they didn’t include information required by the Act and argued the council doubled up on some infrastructure fee by charging twice for the increased demand on services the development would create.

The stoush began the day before Christmas Eve 2016, with the finding published this month.

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The Lakes Residences in Mermaid Waters.

It took place with the backdrop of the council repeatedly delaying a decision on their highly-publicised Mariners Cove proposal on the Spit, which Sunland eventually withdrew.

Court documents reveal the judge accepted none of the council’s six legal arguments for not including the reasons for issuing the fees on the notices issued to Sunland.

The council further argued the charges should not be set aside because Sunland had “not suffered any prejudice by reason of any noncompliance” by the council.

It argued the developer had appealed the charges notices on numerous grounds and was “seeking to circumvent” the appeals process.

Soheil and Sahba Abedian. Photo by Richard Gosling

Judge Kefford did not accept those arguments either.

The council has applied for a strikeout of Sunland’s applications or a summary judgment to finalise the matter. The court will now have to hear from both sides on how to proceed.

Sunland managing director Sahba Abedian was unable to comment as the matter is still before the court.

The first land release in The Lakes sold out in seven weeks for $33 million, while the 67 townhouses have also been snapped up.

Prices for the parkfront villas started from $705,000 and the freestanding lakefront homes were priced from $1.05 million.

Sunland has also commenced work on its $200 million retail precinct The Lanes.