Weststate Private Hospital project caught in legal battle playing out in Supreme Court

Legal documents about a court battle involving Townsville’s Weststate Private Hospital project reveal issues at the centre of the projects stalled construction. DETAILS.

View of the future Weststate Private Hospital from Obrien St. Picture: Leighton Smith.

A legal stoush over Townsville’s partially-constructed Weststate Private Hospital has revealed building defects and a changed scope of works are at the centre of why the troubled project has stalled, according to court documents.

Construction has been underway since February 2022 on the five-storey on the corner of Sturt Street and Ingham Road, which is attached to the redeveloped heritage-listed former Townsville West State School – with construction grinding to a near-halt over the past year due to legal wrangling.

The Brisbane Supreme Court’s civil jurisdiction has two concurrent matters playing out involving Weststate Private Hospital Limited (WPHL) as the plaintiff.

Founded by specialists Dr Peter McEwen, Dr Kaushik Hazratwala, and Dr Kiran Hazratwala, WPHL is a sole-purpose company for the development which would lease the hospital.

WPHL launched a civil claim for damages in February 2024 against Centuria Capital, Centuria Healthcare Pty Ltd, Benjamin Powell Griffin, Grant Anthony McOmish, and Lautaret Pty Ltd – a joint venture company within the Geon Property Group.

Weststate Private Hospital groundbreaking event with Geon Property's Ben Griffin, Woollams Constructions' George Bogiatzis, Centuria's Andre Bali and Weststate Private Hospital Limited's Dr McEwen. Picture: Supplied.

Practical completion for the project was revised to be 25 November 2025, but given the legal battles there is no certainty that will be achievable.

According to Weststate’s statement of claim, on March 12, 2025, the plaintiff was served with a document on behalf of the landlord giving notice that the development agreement with Lautaret was terminated, as was the agreement for lease.

At the heart of WPHL’s complaint before the court was that before the agreement for lease was signed, Lautaret, Centuria Capital, and Centuria Healthcare made representations about the brief’s scope while simultaneously reducing or changing that scope – a contentious issue expected to be explored in a future trial.

Construction material was piled and water pooled at the site of the Weststate Private Hospital on Thursday. Picture: Leighton Smith.

It was submitted that aspects of the hospital that were missing, the building works had been defective, they did not comply with the requirements, or meet the purposes of which the agreements required.

There were also issues in relation to the medical gas supply, and issues in relation to the heritage building being developed.

According to the claim, the delay in the building works has resulted in the plaintiffs having to outlay money for equipment in anticipation of entering into possession of the hospital, which has then meant that they had to carry those costs during the period of delay.

The former Townsville West State School will be revitalised during the construction of the Weststate Private Hospital. Picture: Leighton Smith.

As the case progresses towards mediation and potential trial, an application was lodged by Lautaret, Centuria Capital, and Centuria Healthcare for WPHL provide a security of $736,319 or other sums deemed appropriate within 14 days to ensure their costs could be covered, otherwise the proceedings would be temporarily or permanently halted.

The plaintiff contended that the application was oppressive and excessive, given the delay and significant costs incurred in progressing the legal proceedings.

In her judgment, Justice Frances Williams said WPHL’s financial statements “raised some concerns”, where it had been submitted that there had been “significant losses over the last two years, totalling over $4m … (with) very little income with substantial outgoing expenses”.

Considering the nature of the claim, and the nature of the plaintiff as a special purpose vehicle, the direct link between the plaintiff’s financial predicament and the nature of the claim itself, she said if security was required, “it would be appropriate to limit it to … the conclusion of a mediation”.

View from Ingham Rd of the future Weststate Private Hospital. Picture: Leighton Smith.

“I also consider that care needs to be taken such that the plaintiff is not, in effect, locked out of pursuing its claim as a result of a security being ordered to be provided,” Justice Williams said.

“The applicant has submitted that an amount of approximately $330,000 would be appropriate up to the stage up until mediation, but if I was minded to grant security in an amount, it would be for an amount of $275,000.”

Once Weststate Hospital Holdings Limited agreed to the undertaking, she ordered the application for security for costs be dismissed, while leaving the door open for another application after any mediation, and for the costs to be reserved for the security of costs application.

Originally published as Weststate Private Hospital project caught in legal battle playing out in Supreme Court