Lawyers, funders claim lion’s share of Redland council $6.2m payout for unlawful canal levy

After a bitter decade-long legal battle over unlawful waterfront levies, 1620 Redland ratepayers will receive compensation but lawyers will claim the majority of the $6.2 million payout.

Redland man John Kozik was the main plaintiff in the case brought against Redland City Council for unlawful canal levies. Picture: Judith Kerr

A total of 1620 Redlands ratepayers are finally set to receive compensation after a decade-long court battle with their local council over an unlawful waterfront levy.

But it will be the lawyers and litigation funders who will take the lion’s share of the $6.2 million the council will ultimately pay out.

In a judgment handed down this week, the Supreme Court approved the final distribution stemming from a 2021 judgment which found Redland City Council had unlawfully charged special levies between 2011 and 2016 to maintain canals and marinas in Raby Bay, Aquatic Paradise, and Sovereign Waters.

An excerpt from a 2018 letter to waterfront Redland ratepayers from the council explaining the move away from canal levies. Picture: Contributed

The class action, originally brought by four residents John Kozik, Simon and Sarah Akero, and Neil Collier, led to a $3.79 million judgment entered in 2021 against the council.

That decision was upheld by the Queensland Court of Appeal in 2022 and later by the High Court of Australia in 2024.

The dispute arose after the Redland City Council imposed special levies on waterfront property owners, arguing the funds were for maintaining canals and marinas.

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

However, the ratepayers challenged these charges, claiming they were unlawful because they related to public infrastructure costs that should have been funded through general rates, not special levies.

After years of legal proceedings, the courts ruled in favour of the ratepayers, finding the levies were illegally imposed.

With the addition of interest, legal fees, and administration costs, the final “resolution sum” rose to just over $5.9 million.

The council was also ordered to pay a further $300,000 for final legal and administrative expenses, bringing the total public cost to more than $6.2 million, all of which will ultimately be funded by Redland ratepayers.

However, a significant portion of the total will be used to cover the costs of funding the legal proceedings.

Shine Lawyers, who ran the case, will receive $1.2 million in legal costs, a figure reviewed and approved by an independent costs assessor.

Litigation funder Augusta Ventures will receive about $2.63 million, comprising a $1.4 million commission and $1.19 million in reimbursed legal expenses, as approved by the court.

A maximum of $200,000 has been allocated to administer the compensation scheme, which will be managed by Shine Lawyers.

Respected lawyer Jonathan Horton KC represented Redland City Council.

That leaves a significantly reduced pool for the 1620 eligible ratepayers, whose individual compensation amounts will depend on how much they paid in the unlawful levy.

Most are expected to receive an average of around $1700 or less.

The court also awarded a combined $20,000 to the four lead plaintiffs in recognition of their decade-long involvement in the case.

Mr Kozik was granted $10,000, while the Akeros will get a combined $5000 and Mr Collier will also receive $5000.

Redland couple Sarah and Simon Akero were both awarded $2500 each for the decade-long legal battle.

Justice Rebecca Treston said the compensation was a fair outcome, given the legal and financial complexities involved.

She acknowledged the lead plaintiffs’ “considerable personal commitment” and the “risks undertaken” by the legal and funding teams in pursuing the case through multiple courts.

Shine Lawyers will now contact eligible property owners with a formal notice outlining how the compensation will be calculated and distributed.

The ruling marks the final chapter in a protracted legal saga that began when waterfront residents objected to being charged for what they argued were public infrastructure costs back in 2016.

Mr Kozik said the outcome confirmed the often-high price of justice.

Originally published as Lawyers, funders claim lion’s share of Redland council $6.2m payout for unlawful canal levy