Nicolaou v Minister for Education and Early Learning - [2025] NSWLEC 56

Land and Environment Court

New South Wales

Amendment notes

Medium Neutral Citation: Nicolaou v Minister for Education and Early Learning [2025] NSWLEC 56
Hearing dates: 26-28 March, 1 April 2025
Date of orders: 13 June 2025
Decision date: 05 June 2025
Jurisdiction: Class 3
Before: Beasley J
Decision:
(1) In proceedings 2023/00308805, compensation under Pt 3 Div 4 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW), for the compulsory acquisition of the Applicants’ interest in the land known as Lot 299 of DP 1285364 (also known as 50 Terry Road, Box Hill) is determined in the sum of $27,168,234.00 plus statutory interest.
(2) Costs are reserved.
(3) Should the parties agree on an order for costs, I will make that order upon notification of the agreement, which should be provided to me within seven days of the date of this judgment. If the parties are unable to reach an agreement as to costs, they should notify me within seven days of the date of this judgment, and I will make any further necessary orders to enable that dispute to be resolved.
See further order at [138].

Catchwords:
COMPULSORY ACQUISITION — Objection to compensation offered pursuant to s 66 of Land Acquisition (Just Terms Compensation) Act 1991 (NSW) — Valuation — Public purpose for which the land acquired — Rezoning of land — Disturbance claim — Easement

Legislation Cited:
Conveyancing Act 1919 (NSW), s 88B
Education Act 1900 (NSW) ss 5, 6, 125
Environmental Planning and Assessment Act 1979 (NSW) s 3.15
Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ss 4, 10A, 11, 54, 55, 56, 59, 61, 66
Baulkham Hills Local Environmental Plan 1991
Baulkham Hills Local Environmental Plan 2005
Box Hill and Box Hill Industrial Growth Centre Precincts Development Control Plan 2013
Box Hill and Box Hill Industrial Precinct Plan 2012
Box Hill Growth Centre Precincts Development Control Plan 2018
Hills Local Environmental Plan 2019
State Environmental Planning Policy (Exempt and Complying Development Codes) 2008
State Environmental Planning Policy (Precincts – Central River City) 2021
State Environmental Planning Policy (Sydney Region Growth Centres) 2006
Uniform Civil Procedure Rules 2005 Sch 7, cl 4, r 28.2

Cases Cited:
Adams v Valuer General [2014] NSWLEC 1005
Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 167 ALR 575
Desane Properties Pty Ltd v State of New South Wales [2018] NSWSC 553
El Boustani v Minister Administering the Environmental Planning and Assessment Act 1979 [2012] NSWLEC 266
Goldmate Property Luddenham No 1 Pty Ltd v Transport for NSW [2024] NSWCA 292
Graham Trillby Pty Ltd v Valuer General [2009] NSWLEC 1087
Marroun v Roads and Maritime Services [2012] NSWLEC 199
Redeam Pty Ltd v South Australian Land Commission (1977) 17 SASR 508; (1977) 40 LGRA 151
Richardson v Roads and Traffic Authority (NSW) (1996) 90 LGERA 294
Riverbank Pty Ltd v Commonwealth (1974) 48 AJLR 483
Roads & Traffic Authority (NSW) v Perry (2001) 52 NSWLR 222; [2001] NSWCA 251; (2001) 116 LGERA 244
Roads and Maritime Service (NSW) v United Petroleum Pty Ltd (2019) 99 NSWLR 279; [2019] NSWCA 41
Spencer v Commonwealth (1907) 5 CLR 418; [1907] HCA 82
Sydney Metro v G & J Drivas Pty Ltd (2024) 113 NSWLR 429; [2024] NSWCA 5; (2024) 258 LGERA 197
Sydney Water Corporation v Caruso [2009] NSWCA 391
Tenstat Pty Limited v Valuer General / Woolworths Limited v Valuer General [2012] NSWLEC 1361
The Eddie Arnott Corporation Pty Ltd v Sydney Metro [2025] NSWLEC 12
Turner v Minister of Public Instruction (1956) 95 CLR 245; [1956] HCA 7
Walker CorporationPty Limited v Sydney Harbour Foreshore Authority (2008) 233 CLR 259; [2008] HCA 5

Texts Cited:
Hills Future 2036 – Local Strategic Planning Statement, October 2019
Hills Shire Council Recreation Strategy

Category: Principal judgment
Parties: Michael Nicolaou (First Applicant)
Rita Nicolaou (Second Applicant)
Minister for Education and Early Learning (Respondent)
Representation:
Counsel:
Mr S Prince SC and Ms T Wong (First and Second Applicant)
Mr P Tomasetti SC and Ms A Hemmings (Respondent)
Solicitors:
Stacks Law Firm (First and Second Applicant)
HWL Ebsworth (Respondent)

File Number(s): 2023/00308805
Publication restriction: Nil

JUDGMENT

On 10 February 2023 (Acquisition Date), the Respondent to these proceedings, the Minister for Education and Early Learning (Education Minister) acquired by compulsory process Lot 299 in DP 1285364, being part of 50 Terry Road, Box Hill (Acquired Land). Immediately prior to the compulsory acquisition, the Acquired Land (which comprises 2.842ha) had been part of Lot 29 DP 10157 (Parent Parcel). As a result of the acquisition of the Acquired Land, the Applicants, who were the registered proprietors of the Parent Parcel at the date of acquisition, now own the remaining 1.516ha of the Parent Parcel, now identified as Lot 300 in DP 1285364 (Residue Land).
The Applicants bring these proceedings pursuant to s 66 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (Just Terms Act), objecting to the amount of compensation offered by the Respondent for the acquisition of the Acquired Land.
Prior to the commencement of the hearing, the parties’ expert valuers (Mr L. Kenny for the Applicant, and Mr M. Dyson for the Respondent) reached agreement that the market value of the Acquired Land pursuant to s 56(1)(a) of the Just Terms Act was $27,000,000 (discussed further below).
The parties also reached agreement on the following claims for compensation with respect to the Acquired Land:

s 55(e) - Disadvantage from relocation $85,350.00

s 59(1)(a) - Legal costs $61,654.00

s 59(1)(b) - Valuation fees $21,230.00

The Applicants further seek compensation in the amount of $4,327,393.00, comprising the following:

s 55(f) (decrease in value of the Residue Land) $2,880,400.00

s 55(d); 59(1)(f) (disturbance losses) $1,446,993.00

The Respondent contends that compensation for the above claims should be assessed as nil.
For the reasons outlined below, I agree. Accordingly, for the further reasons outlined below, the Applicants are entitled to compensation in the sum of $27,168,234.00.

Background

Site Description

The Parent Parcel is located in the Box Hill precinct, in a residential area approximately 5 kilometres north of the Rouse Hill Town Centre. It is centrally located within the North West Priority Growth Area. The Box Hill precinct is an area of increasing urban development, previously consisting of mainly rural-residential suburbs. [1]
1. Exhibit F, p 878 at [44].
The Parent Parcel is a rectangular-shaped allotment and gently slopes across its width (north to south, towards the rear) but is otherwise flat.
The Acquired Land is 2.842ha, comprising approximately 65% of the Parent Parcel. It is located at the front portion of the Parent Parcel, with a frontage of 100.585 metres to Terry Road. It contains the following features:

one two-storey residential dwelling;

an inground swimming pool adjacent to the northern side boundary;

a large industrial-sized metal shed adjacent to the southern side boundary, constructed on a concrete hardstone slab;

a dam located west of the shed;

a bore and irrigation;

freestanding water tanks, and a large underground water tank;

fencing in and around the land;

a shipping container; and

various freestanding structures including, but not limited to, greyhound exercise structures, feed shelters, and outbuildings for housing greyhounds.

The Residue Land is 1.516ha, comprising 35% of the Parent Parcel, and located at the rear. It is primarily pastural, with no existing structures beyond fencing and a bore water pump mechanism in the north-western corner. [2]
2. Exhibit 2, p 776 at [25].

History of Ownership

The Applicants purchased the Parent Parcel on the 9 October 1995. Since this date, it has been used as their dwelling, and as the location for their business of greyhound training, racing, and breeding. Rita Nicolaou (the Second Applicant) has stated that the site was chosen for its size, which accommodated their greyhound-related needs, and for its proximity to the Box Hill Trial Track for greyhound trials.^[3]
3. Affidavit of Rita Nicolaou dated 21 November 2023 at [20].
Both Applicants are registered as trainers for racing greyhounds and have trained greyhounds for over 30 years.^[4] While they have won races, their greyhound business has not made a profit because of the expenses associated with keeping greyhounds.^[5]
4. Affidavit of Rita Nicolaou dated 21 November 2023 at [16]-[17].
5. Affidavit of Rita Nicolaou dated 21 November 2023 at [21].
The following features were added to the Parent Parcel to accommodate the greyhound activities:

two indoor kennels with eighteen kennels for racing greyhounds and two isolation kennels for sick or injured greyhounds;

two whelping demountables and pens for use as a birthing kennel;

seven outdoor pens and kennels;

nine starter boxes;

large gallop/catching pen with a 350 metre straight trail track;

bullring;

greyhound food preparation area; and

the shipping container for storage of dry dog food.

The Parent Parcel has also been used as the “base” for the businesses of their sons Adrien and Nathan Nicolaou.^[6] Adrien Nicolaou conducts a lawnmowing business called ‘Kickass Grass Lawncare’, and Nathan Nicolaou conducts a business called ‘Cable & Metal Solutions Pty Ltd’ which trades as ‘ARC Metals.’
6. Affidavit of Rita Nicolaou dated 21 November 2023 at [30]-[31].
Adrien Nicolaou uses the shed (on the Acquired Land) to store lawnmowers and other equipment for his business. Nathan Nicolaou stores a large wire stripping machine in the shed. Large metal objects, such as disused machinery and large metal bins, are also kept on the Property for the purpose of his business.
The Applicants also keep livestock, namely a flock of sheep to manage the grass, one llama, seven alpacas to protect the sheep, and five goats. The number of sheep varies depending on whether it is lambing season or not, but the Second Applicant states that there are “about 50… at any given time.” Some infrastructure has been added to manage these animals including:

a shed with a metal run for drenching, shearing and treating the sheep;

a sheep crush to turn sheep for medical treatments;

fencing to create paddocks;

troughs for drinking water; and

trailers used to transport the sheep.^[7]
7. Affidavit of Rita Nicolaou dated 21 November 2023 at [22]-[26].

At the date of the proceedings, the Applicants remain in occupation of the entire Parent Parcel, despite the acquisition of the Acquired Land.
Primarily for the purposes of the Applicants’ disturbance claims, a site view took place on the second day of the hearing, during which the various features of the Acquired Land and Residue Land referred to above were observed.

Easement

Prior to acquisition, it was known by both parties that as a result of the acquisition of the Acquired Land, the Residue Land at the rear would become landlocked. The Applicants’ solicitor entered into negotiations with the Respondent’s then solicitors to ensure the Applicants would have a legal right of access and access to services on the Residue Land.
By email dated 16 January 2023 (prior to the date of acquisition) the Respondent’s solicitors informed the Applicants’ solicitors that the Respondent proposed to:

“…grant an easement over the Acquisition Land (being the proposed Lot 299 in the attached plan) on the terms of the attached, benefitting the Residue Land. This will ensure the Residue Land both has access to Terry Road, and services are accommodated. It is proposed that the easement would run along the southern boundary of the Acquisition Land, being along the boundary between 48 and 50 Terry Road.” [8]
8. Exhibit MS-1 to the Affidavit of Mark George Shumsky dated 20 November 2023, p 188.

After the Acquisition Date, on 19 April 2023, the Respondent registered on the Acquired Land a ‘Plan of Easement Over Lot 299 in DP 1285364’ (‘the Easement’) benefiting the Residue Land, pursuant to s 88B Conveyancing Act 1919 (NSW).^[9] It consists of a four-metre wide Right of Carriageway and a four-metre wide Easement for Services.^[10] The Easement is located along the southern boundary of the Acquired Land, namely along the boundary between 48 and 50 Terry Road.
9. Exhibit K, pp 15-21.
10. Exhibit K, pp 15-21.
The Easement states that the Right of Carriageway will be “extinguished upon alternate access to the public road network being made available,” and the Easement for Services will be extinguished when “connections for domestic services are made available to the boundary of the [Residue Land] via a public road within or adjoining the [Residue Land].”^[11]
11. Exhibit K, p 16.

Planning and Acquisition History

When the Applicants first purchased the Parent Land, it was zoned 1(a) Rural under the Baulkham Hills Local Environmental Plan 1991 (LEP 1991).^[12]
12. Exhibit 3, p 844 at [25].
From 26 August 2005 the Baulkham Hills Local Environment Plan 2005 (LEP 2005) superseded the LEP 1991, however the Parent Land remained zoned for rural purposes within Zone Rural 1(a).^[13] This zoning persisted until 5 October 2012.
13. Exhibit 3, p 849 at [38].
On 27 July 2006, the State Environmental Planning Policy (Sydney Region Growth Centres) 2006 (Growth Centre SEPP 2006) came into force. The Parent Parcel was mapped within the Box Hill Precinct as part of the North West Growth Centre. However, the Box Hill Precinct was not subject to the Growth Centre SEPP 2006, and the LEP 2005 zoning remained.
In October-November 2011, the first exhibition of the draft Development Control Plan for the Box Hill Precinct was released, including a Draft Indicative Layout Plan (ILP) depicting the future road layout of the Box Hill precinct and location of open space.
The 2011 draft ILP identified two proposed areas to serve as future open space to be acquired by the Council.^[14] The open space to the south-west of the Parent Parcel was identified for a future sports field (‘Field 5’) and the open space to the north-west was identified for a second sports field (‘Field 6’). Neither of the fields abutted the boundaries of the Parent Parcel. [15]
14. Exhibit 2, pp 780-781 at [40] – [43].
15. Exhibit 2, p 780 at [41].
The then Department of Planning and Infrastructure (Department of Planning) published its post-Exhibition Planning Report for the Box Hill and Box Hill Industrial Precinct Plan in December 2012 (Box Hill PP 2012). [16] In relation to “open space and recreation”, the Box Hill PP 2012 relevantly provided:

3.2 Open Space and Recreation
The exhibited plans for the Precincts identified areas of open space including parks and sports fields to cater for a range of active and informal recreational activities. Open space was provided in accordance with guidelines set out in the Growth Centres Development Code and standards set by Council. This consisted of six active parks incorporating sporting fields, mostly situated around the Killarney Chain of Ponds and its tributaries; and ten local parks evenly distributed throughout the precincts. In total there was 42.2ha of public open space, as shown on the figure below.
Council subsequently determined that additional active open space (playing fields) will be necessary to meet the needs of the new community. A further review of open space provision sought to ensure that sufficient open space will be provided to meet the needs of residents while ensuring that land is used efficiently and section 94 contributions are kept as low as possible. Wherever possible, open space and recreational facilities have been co-located with school sites and drainage infrastructure to minimise the amount of developable land being used for these purposes.
The resulting post-exhibition changes to the open space network were:
Increase in the size of playing fields 3 and 4 – an increase in the size of certain playing fields to accommodate parking and amenities.
Relocation of playing field 6 – The previous location was constrained by steep topography and the new location behind the K-12 school on Terry Road next to Field 5 provides for shares facilities and a reduction in the amount of land required for the school. [17]
16. Exhibit K, p 208.
17. Exhibit K, pp 229-230.

The reference to the K-12 School on Terry Road is a reference to the Acquired Land (SP2 School Zone Land). The proposed school was further referred to in the Box Hill PP 2012, which relevantly provided:

3.11 Schools
The DP&I has worked closely throughout the planning process with the NSW Department of Education and Communities (DEC) to identify sites for public schools which satisfy DEC criteria.
The possible locations of future schools were not altered post exhibition, however the size of the proposed K-12 school on Terry Road has been reduced slightly in size. This resulted in a small increase in the amount of land that can be developed for residential purposes. Discussions with DEC have confirmed that the size of this school can be reduced on the basis that it is located adjacent to local public playing fields. The playing fields are to be owned and managed by Council, and used by the school during school hours, with public use outside school hours. [18]
18. Exhibit K, p 240.

It is clear enough from the Box Hill PP 2012 (as well as an obvious and conventional matter of planning) that the Department of Planning consulted the Department of Education in the identification of sites (such as the Acquired Land) that would be needed in the precinct area for public schools. As another aspect of planning, those discussions appeared to include a consideration of the location of “local public playing fields” adjacent to the proposed K-12 School, with those fields to be “owned and managed by Council, and used by the school during school hours, with public use outside school hours”.
In the second draft exhibition of the Hills Growth Centre Precincts Plan, the mapping was modified to relocate Field 6 on the Residue Land.^[19]
19. Exhibit 2, p 781 at [42] – [43].
On 5 October 2012, the Hills Local Environmental Plan 2012 (LEP 2012) was gazetted, and the Parent Parcel was zoned RU2 Rural Landscape.
On 5 April 2013, the Parent Parcel was part zoned SP2 Infrastructure (School) (the Acquired Land) and part zoned RE1 (Public Recreation) (Residue Land) under the Growth Centre SEPP 2006 by reason of the Land Zoning Map and Land Reservation Acquisition Map. [20]
20. Exhibit B, pp 706, 743, 747.
In May 2013, the Box Hill Industrial Precinct Plan was finalised.
On 30 January 2019, the Respondent commenced negotiations with the Applicants for the purposes of the compulsory acquisition process in accordance with s 10A Just Terms Act.
On 22 October 2019, the Council endorsed the Hills Future 2036 – Local Strategic Planning Statement, October 2019 (Strategic Plan) and on 22 October 2019, the Council adopted the Hills Shire Council Recreation Strategy (Recreation Strategy). [21] This strategy set out the basis for planning and provision of open space and recreation facilities in The Hills Local Government Area.^[22]
21. Exhibit K, p 589 - 590.
22. Exhibit K, p 599.
The Council’s Recreation Strategy was prepared to establish “the basis for the planning and provision of open space and recreation facilities in the Shire to 2036”. [23] As could be expected, the Recreation Strategy addressed predicted population and home dwelling growth over the coming 20-year period for the Hills Shire; current available active and passive open space; set benchmarking ratio targets (hectares per 1000 people) for open space; and the amount of land needed to meet those benchmarking ratios. The Recreation Strategy contains mapping of currently available playing fields, active open space, as well as passive open space.
23. Exhibit K, p 599.

Shared use of public playing fields with schools is discussed in the Recreation Strategy, which contains the following:

Shared use with schools
Schools offer a good opportunity for adding playing fields. Council has forged relationships with the Department of Education and individual schools with the view of progressing joint-use partnerships for school playing fields, through the signing of a non-binding Shared Heads of Agreement for Joint Use Partnerships. Similar discussions have been evolving with private schools. School sites would be unavailable to the general public during normal school hours. However, outside of these times the facility may be accessible to the community…
Council is responsible for funding the transformation of a standard natural turf playing field to a synthetic facility with associated infrastructure. School sites will also require facilities complementary to a synthetic field including an amenities building, floodlighting, fencing and car parking… [24]
24. Exhibit K, p 626.

Through its Recreation Strategy, the Council also indicated that “as with active sporting fields,” it was also “seeking opportunities for joint partnership arrangements with the Department of Education” in relation to parks and playgrounds. [25]
25. Exhibit K, p 631.
One of the planned future playing fields is the “Sunny Hill Parkway Sports Complex”. [26] It is not in dispute in the proceedings that this proposed sports complex would be sited on Field 5 and the relocated Field 6 (that is, part of it would be on the RE1 zoned Residue Land).
26. Exhibit K, pp 661, 674.
On 1 March 2022, the State Environmental Planning Policy (Precincts – Central River City) 2021 (Precincts SEPP 2021) came into force, superseding the Growth Centre SEPP 2006. Appendix 10 of the Precincts SEPP 2021 contains The Hills Growth Centre Precincts Plan 2013 which applied to the Parent Parcel. The Acquired Land remained zoned SP2 Infrastructure (School) and the Residue Land RE1 Public Recreation.
The Respondent issued a Proposed Acquisition Notice (PAN) to the Applicant pursuant to s 11 of the Just Terms Act on 7 October 2022, and acquired the Acquired Land on 10 February 2023.

Hearing

The hearing commenced on 26 March 2025. Mr Prince SC appeared with Ms Wong for the Applicants, and Mr Tomasetti SC appeared with Ms Hemmings for the Respondent. On 27 March 2025, I undertook a site view (with Acting Commissioner Parker, who was assisting me, but not adjudicating (s 37(3) Land and Environment Court Act 1979)) of the Parent Land and was made abreast of key features such as the location of the above-mentioned site details, the boundary between the Acquired and Residue Land, and the location of the Easement on the Acquired Land.
Both parties assisted the Court with a written outline of opening submissions, and subsequently with closing submissions, as well as a set of supplementary written submissions addressing the claims for disturbance, specifically the relevance of the State Environmental Planning Policy (Exempt and Complying Development Codes) 2008.

Issues for Determination

The issues for determination in these proceedings are the following:
Issue 1: what is the public purpose for which the Acquired Land was acquired for the purposes of s 56(1)(a) and s 55(f) of the Just Terms Act?
The Applicant contends that the public purpose for which the Respondent acquired the Acquired Land was to create a public school which had recreational land at its rear (the Residue Land). The claim is that this public purpose of the Respondent caused the RE1 zoning of the Residue Land, which would otherwise have had a residential zoning, so that the public purpose of the acquisition caused a decrease in the value of the Residue Land such that compensation is payable under s 55(f) of the Just Terms Act. As described below, this also is relevant to the claims for compensation for disturbance losses.
The Respondent contends that the public purpose of the acquisition “was to provide a school on the acquired land”. [27] The Respondent asserts that the public purpose of the acquisition is of no relevance to the zoning of the Residue Land, and that no claim for compensation can be maintained under s 55(f) of the Just Terms Act.
27. Respondent’s Closing Submissions (RCS) at [41].
Issue 2: pursuant to s 55(f) of the Just Terms Act, has there been any decrease in the value of the adjoining Residue Land by reason of the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired, and if so, what is the amount of that decrease?
As to this issue, the Applicant’s claim is that there has been a decrease in value of the Applicant’s Residue Land caused by the public purpose acquisition of the Acquired Land of “at least $2,880,400”. [28] The Respondent denies that any compensation is payable to the Applicant under s 55(f).
28. Applicants’ Closing Submissions (ACS) at [3].
Issue 3: what is the market value of the Acquired Land at the date of acquisition pursuant to s 55(a) and s 56(1)(a) of the Just Terms Act?
To this issue, the expert valuers in both of their joint reports have agreed the market value of the Acquired Land at date of acquisition was $27,000,000. This is addressed below at [125] to [129].
Issue 4: what is the amount of the Applicant’s entitlement to compensation with respect to claims for disturbance losses under s 55(d) and s 59(1) of the Just Terms Act, and does s 61(b) of the Just Terms Act preclude any of the sums claimed for disturbance?
Issue 5: although not expressly raised as an “issue” in either parties’ written submissions, the Applicant contends that the Residue Land has become “landlocked” as a result of the “carrying out of… the public purpose for which the [Acquired] land was acquired” [29] , and that this has caused a decrease in value of the Residue Land.
29. Goldmate Property Luddenham No 1 Pty Ltd v Transport for New South Wales [2024] NSWCA 292 (‘Goldmate’) at [71].
The Respondent denies that the Residue Land has become landlocked as a result of the acquisition. [30] While there appeared to be agreement that the Residue Land was not “legally” landlocked as the result of a grant of the Easement over the Acquired Land to the Residue Land, the Applicants maintain a contention that the Easement failed to provide what they term “practical access” to the Residue Land over the Acquired Land because of the topography of the land over which the Easement was granted. While they contended that the Court should “order compensation” pursuant to s 55(f) for decrease in value caused to the Residue Land by what they say is the “practical” landlocking, this claim does not appear to have been separately quantified in any expert evidence.
30. See Points of Defence at [16a].

Legislative Framework and Fundamental Principles

The power of the Respondent to acquire the Acquired Land is found in s 125(1) of the Education Act 1900 (NSW) (Education Act) which provides as follows:

125 Acquisition and disposal of land
(1) The Minister may, for the purposes of this Act or jointly for those purposes and purposes of or associated with public education or recreation, acquire land (including an interest in land) by agreement or by compulsory process in accordance with the Land Acquisition (Just Terms Compensation) Act 1991.

The principal objects of the Education Act are set out in s 5 and relevantly include “to provide for the establishment and operation of government schools”: s 5(b).
As to the acquisition here, the Applicants are entitled to compensation in such amount that would justly compensate them for the acquisition of the Acquired Land: s 54(1) of the Just Terms Act. In determining the amount of compensation to which the Applicants are entitled, regard must be had to the matters set out in s 55(a) to (f) of the Just Terms Act, which is in the following terms:

55   Relevant matters to be considered in determining the amount of compensation
In determining the amount of compensation to which a person is entitled, regard must be had to the following matters only (as assessed in accordance with this Division)—
(a)  the market value of the land on the date of its acquisition,
(b)  any special value of the land to the person on the date of its acquisition,
(c)  any loss attributable to severance,
(d)  any loss attributable to disturbance,
(e)  the disadvantage resulting from relocation,
(f)  any increase or decrease in the value of any other land of the person at the date of acquisition which adjoins or is severed from the acquired land by reason of the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired.

The sub-sections relevant to the Applicants’ claim are s 55(a) (market value of the Acquired Land on the date of its acquisition); s 55(d) (loss attributable to disturbance); and s 55(f) (whether there has been a decrease in the value of the Residue Land as a result of public purpose acquisition of the Acquired Land).
“Market value” of land is defined in s 56(1)(a) of the Just Terms Act to mean:

56 Market value
(1) In this Act—
market value of land at any time means the amount that would have been paid for the land if it had been sold at that time by a willing but not anxious seller to a willing but not anxious buyer, disregarding (for the purpose of determining the amount that would have been paid)—
(a) any increase or decrease in the value of the land caused by the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired…

Issue 1: Identifying the Public Purpose

General Principles

It has been said that there are no “clear rules” in the determination of the public purpose for an acquisition. The factors to be taken into account “include the degree of continuity and consistency of various elements of what is proposed and done, and fairness to both the claimant and the acquiring authority”: Roads & Traffic Authority (NSW) v Perry (2001) 52 NSWLR 222; [2001] NSWCA 251; (2001) 116 LGERA 244 at [100] per Hodgson JA. The starting point however is the definition of “public purpose” in the Just Terms Act, which is “any purpose for which land may by law be acquired by compulsory processes” under that Act: s 4. The acquiring authority here – the Respondent Education Minister – has power to acquire land under s 125(1) of the Education Act, as referred to above. The public purpose here must fall within the purposes outlined in that power: that is for the purposes of the Education Act, or jointly “for those purposes and purposes of or associated with public education or recreation”: see Goldmate Property Luddenham No 1 Pty Ltd v Transport for New South Wales [2024] NSWCA 292 at [71], [73] (‘Goldmate’).
The public purpose disregard provided for in s 56(1)(a) of the Just Terms Act involves a “causation inquiry”, which will involve “attribution of legal responsibility” for purposes of establishing causation: Sydney Metro v G & J Drivas Pty Ltd (2024) 113 NSWLR 429; [2024] NSWCA 5; (2024) 258 LGERA 197 at [32] and [33] per Kirk JA.

Planning History Relevant to the Public Purpose

As stated above, at the date of acquisition the Acquired Land was zoned SP2 Infrastructure (School), and the Residue Land was zoned RE1 Public Recreation pursuant to the Precincts SEPP 2021. The Precincts SEPP 2021 identifies the Education Minister as the acquiring authority for SP2 Infrastructure (School) zoned land for the purposes of s 3.15 of the EP&A Act (for owner induced acquisitions). The Council is the acquiring authority for land zoned RE1 Public Recreation: s 5.1(2) of part 5 of the Precincts SEPP 2021. [31]
31. Exhibit K, p 1531.
Just under a year before the date of acquisition, the Residue Land had been identified by the Council as needed for the local community, and the Council began the steps for its compulsory acquisition. [32]
32. Exhibit K, pp 2736-2738.
As also stated above, prior to the creation of the Precincts SEPP 2021, the Parent Parcel had been zoned part SP2 Infrastructure (School) (the Acquired Land) and part RE1 Public Recreation (the Residue Land) according to the Land Reservation Acquisition Map (effective from 5 April 2013) under the Growth Centre SEPP 2006.
The Government Gazette (for 10 February 2023) records that the Acquired Land was acquired “for the purposes of the Education Act 1900”. [33]
33. Exhibit K, p 36.

Expert Planning Evidence Relevant to the Public Purpose

In his report of 9 May 2024 (First Nash Report), Mr Nash, the expert planner for the Applicant, expressed the following opinions:

4.4.9 … for the ‘acquired land’, the acquiring authority is the NSW Department of Education, the authority responsible for the provision of public education infrastructure and educational services for the State generally, and in this case the provision of a public school facility in the new growth centre of Box Hill, the Department’s responsibility is giving effect to the long term planning and land use allocation outcomes envisaged under SEPP (Sydney Region Growth Centre) 2006.
4.4.10 The public purpose of the ‘residue land’ is for the provision of local public open space, consistent with its RE1 Public Recreation zone, which would be the responsibility of the relevant local government authority, in this case The Hills Shire Council, so therefore Council’s responsibility is giving effect to the long term planning and land use allocation outcomes envisaged under the SEPP (Sydney Region Growth Centre) 2006 for the ‘residue land’.
4.4.11 In respect to the ‘acquired land’ the date of acquisition of the site by the Minister for Education and Early Childhood was 10 February 2023, almost 10 years after the allocation of land uses under the Land Zoning Maps were determined for the North West Growth Centre, including land reservation acquisition sites, lot size, density and building height controls. The housing development in Box Hill in 2024 is well advanced and reflecting the density characteristics sought under the controls.
4.4.12 In the circumstances it is KN’s opinion that the underlying zoning of the ‘acquired land’ is R3 Medium Density Residential, which in the event of the land not been [sic] identified for a ‘public purpose’ for a school and local open space it would most likely have been zoned R3 Medium Density Residential consistent with the adjoining lands to the north, east and south and furthermore most likely to be already developed for medium density residential purposes similar to the development opposite in Nix Street and Terry Road”. [34]
34. Exhibit B, p 711.

In his report dated 10 May 2024 (First Rowan Report), Mr Anthony Rowan, the planning expert for the Respondent, expressed the view that the public purpose for the project was first identified as part of the Department of Planning’s “plan-making” for the Box Hill PP 2012 and the Growth Centre SEPP 2006, which was subsequently superseded by the Precincts SEPP 2021. [35] His first report then contains the following (including relevant mapping):
35. Exhibit 2, p 777 at [29].

40. The 2011 draft ILP mapped:
(a) the front-most portion of the parent parcel for the public purpose, its footprint reflecting that of the acquired land; and
(b) the rear portion (its footprint reflecting that of the residue land):
i. for future medium density residential development (Image 14).
41. The 2011 draft ILP also identified two proposed areas to serve as as future open space that were close to the parent parcel, as land to be acquired by the Council. The open space to the south-west was identified for a future sportsfield, Field 5 (‘Field 5’); and that to the north-west, to accommodate a second sportsfield, Field 6 (‘Field 6’) (Image 15). Neither of the open space areas, Field 5 nor Field 6, abutted the boundaries of the parent parcel.
42. Post-exhibition the Council determined that additional open space (playing fields) was necessary to meet the needs of the new community. It also identified that Field 6 needed to be relocated as its current proposed location was constrained by steep topography; and also requested its relocation to be alongside Field 5 (Image 15), so enable shared facilities.
43. Thereafter, the mapping of the subsequent second draft exhibition of the precinct plan, to its finalisation, was modified, relocating Field 6 on the residue land, to achieve those outcomes. The subsequent zoning and the ILP maps were modified in that manner thereafter to finalisation. The relocation of Field 6 was a requirement of the Council and zoned RE1 Public Recreation for that public purpose, it being a different public purpose zone to that applied to the acquired land. The Council was nominated as the acquiring authority for RE1 zoned under the final instrument. [36]
36. Exhibit 2, pp 780-781 at [40-43].

In Mr Rowan’s opinion, for the purposes of s 56(1)(a) of the Just Terms Act, the SP2 Infrastructure (School) zoning of the Acquired Land should be ignored as it “represents the public purpose” of the acquisition. [37] The Acquired Land’s “underlying zoning” for market value purposes was “R3 absent the public purpose”. [38] However, the RE1 zoning of the Residue Land is in Mr Rowan’s view “unrelated to the public purpose” and “that zoning would not have differed”. [39]
37. Exhibit 2, p 786 at [56].
38. See First Rowan Report at [57].
39. See First Rowan Report at [62].
In their joint expert report dated 17 May 2024 (Planners’ First Joint Report), the planning experts were agreed on these matters:

the public purpose for the acquisition of the Acquired Land was “for a school”;

in relation to the Residue Land, that “public purpose did not influence or cause the application of its RE1 zoning” and that the “RE1 zoning on the rear (residue land portion) of the parent parcel would have still existed absent the identification of the public purpose on the front (acquired land) portion of the parent parcel”; [40] and

the underlying zoning of the Acquired Land was R3 Medium Density Residential, but the “RE1 zoning over that portion of the parent parcel is not to be disregarded in the consideration of these Proceedings”. [41]
40. Exhibit C, p 801 at [17].
41. Exhibit C, p 801 at [18a].

It can be seen then that at least at the date of the Planners’ First Joint Report, the planning experts had agreed on three key matters:

the public purpose of the acquisition of the Acquired Land was “for a school”;

but for the carrying out of that public purpose, or the proposal to carry it out, the Acquired Land would have been zoned R3 Medium Density Residential; and

the public purpose for the acquisition of the Acquired Land had no bearing on the RE1 zoning of the Residue Land.

However, on 27 June 2024, the Applicants brought a motion for separate determination pursuant to r 28.2 UCPR to determine the following question:

(a) Upon a proper construction of s 56 of the Land Acquisition (Just Terms Compensation) Act 1991, is the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired limited only to the subjective and limited purpose of the Department of Education in issuing the PAN or does it extend to the whole of the scheme for the creation of a public school precinct on the land including the provision of recreational land at the rear of the school?

The Notice of Motion was resolved prior to its hearing, and resulted in some consent orders being made by Pain J on 7 August 2024. Pursuant to those orders, the expert planners were asked to prepare further reports on a particular scenario agreed to between the parties. The orders made by consent were relevantly as follows:

3) Under rr 31.19 and 31.20 of the Uniform Civil Procedure Rules 2005 (‘UCPR’), the Court makes the following directions regarding expert evidence:
Town Planning Evidence
a) Anthony Rowan will prepare an [sic] supplementary expert’s report on the assumption that the public purpose for which the land was acquired” [sic] is to include the broader public purpose contained in the State Environmental Planning Policy (Sydney Region Growth Centres) 2006 – North West Growth Centre and/or Environmental Planning Policy (Precincts – Central River City) 2021 (“the assumed public purpose”) considering:

i) whether the zoning of the acquired land and residue land is attributable to the assumed public purpose; and
ii) what would be the zoning for the acquired land and the residue land but for the carrying out of the assumed public purpose.

b) Kerry Nash may prepare an [sic] supplementary expert’s report on the assumption that the public purpose for which the land was acquired” [sic] is to include the broader public purpose contained in the State Environmental Planning Policy (Sydney Region Growth Centres) 2006 - North West Growth Centre and/or Environmental Planning Policy (Precincts – Central River City) 2021 considering:
i) whether the zoning of the acquired land and residue land is attributable to the assumed public purpose; and
ii) what would be the zoning of the acquired land and the residue land but for the carrying out of the assumed public purpose.

c) Anthony Rowan and Kerry Nash are to confer in relation to:
i) whether the zoning of the acquired land and residue land is attributable to the assumed public purpose;
ii) what would be the zoning of the acquired land and the residue land but for the carrying out of the assumed public purpose,

under UCPR r 31.24 and prepare a supplementary joint expert report on the assumed public purpose.

With all due respect to the agreement that the parties reached, I am not sure that the “broader public purpose” referred to in orders 3(a) and (b) specifies what it is with any precision. If the intention was to have the various experts assume that the public purpose was that as contended for by the Applicant – “to create a public school which had recreation land at its rear” (see [48] above) – then in my view this is not crystal clear from the consent orders made. In any event, in his supplementary report of September 2024 (Supplementary Nash Report), Mr Nash, having reviewed the Growth Centre SEPP 2006 and the Precincts SEPP 2021, expressed the opinion that – in relation to both the Acquired Land and Residue Land – “the likely broader public purpose for the land would have been R3 Medium Density Residential zoning with a minimum lot size of 225m²”. [42] He was consequently of the view that but for the carrying out of the assumed public purpose, the zoning of the Acquired Land and the Residue Land would have been “R3 Medium Density Residential zone”. [43]
42. Exhibit D, p 831.
43. Exhibit D, p 833.
In his supplementary report of 6 September 2024 (Supplementary Rowan Report), Mr Rowan reviewed the “historical strategic planning steps” which in his view were relevant to the making of the Growth Centre SEPP 2006, and the Precincts SEPP 2021, dating back as far as the Sydney Regional Outline Plan 1970-2000 (issued in March 1968). He ultimately concluded that “but for the carrying out of the assumed public purpose, land in the north-western portion of Sydney would not have been released for future rezoning and development for urban purposes”. [44] But for the carrying out of this broader public purpose, Mr Rowan was of the view that the zoning of the Parent Parcel would have been RU1 (a rural zoning) under the Hills Local Environment Plan 2019. [45]
44. Exhibit 3, p 854 at [50b].
45. Exhibit 3, p 855 at [52].
In their supplementary joint report dated 18 September 2024 (Planners’ Second Joint Report), Mr Nash and Mr Rowan did not reach agreement on the central matter that divided them in their supplementary individual reports. Mr Nash maintained his view of an underlying zoning of R3 for both the Acquired Land and the Residue Land, as in his view “the broader public purpose did not extend to the exclusion of planning instruments relevant to [Growth Centre SEPP 2006] – [Precinct SEPP 2021] both of which established and settled the allocation of land uses in the Box Hill Precinct since 5 April 2013 to the present day”. [46] Mr Rowan maintained his view that based on the broader public purpose, the Parent Parcel would have had an underlying rural zoning. [47]
46. Exhibit E, p 865 at [19].
47. Exhibit E, pp 863-867 at [14], [21], [23].
In his oral evidence at the hearing, Mr Nash disavowed the agreement he had reached with Mr Rowan in the Planners’ First Joint Report that the proposal to carry out the public purpose “did not influence or cause” the RE1 zoning of the Residue Land. [48] He said his opinion now was that the public purpose “did influence” the zoning.
48. Exhibit C, p 801 at [17].
The reason for Mr Nash’s change of opinion was that he had not read what he considers to be the entire relevant portion of the Box Hill PP 2012 that was referred to by Mr Rowan at [42] of his first expert report of 10 May 2024. [49] Page 21 of the Box Hill PP 2012 relevantly states as follows:

Council subsequently determined that additional active open space (playing fields) will be necessary to meet the needs of the new community. A further review of open space provision sought to ensure that sufficient open space will be provided to meet the needs of residents while ensuring that land is used efficiently and section 94 contributions are kept as low as possible. Wherever possible, open space and recreational facilities have been co-located with school sites and drainage infrastructure to minimise the amount of developable land being used for these purposes.
The resulting post-exhibition changes to the open space network were:
Increase in the size of playing fields 3 and 4 – an increase in the size of certain playing fields to accommodate parking and amenities.
Relocation of playing field 6 – The previous location was constrained by steep topography and the new location behind the K-12 school on Terry Road next to Field 5 provides for shares facilities and a reduction in the amount of land required for the school. [50]
(emphasis added)
49. Exhibit 2, p 781.
50. Exhibit K, p 230.

Mr Nash explained that he had not read the words “and a reduction in the amount of land required for the school” at the time of making the Planners’ First Joint Report with Mr Rowan, but rather relied on the extract from Mr Rowan’s report: T 96.10-35.
As to when he discovered this matter, it appears that it was the “Wednesday or Thursday” before the commencement of the hearing (which commenced on Wednesday 26 March 2025): T 102.36. He did not communicate his change of opinion to the legal representatives of the Applicant until Monday 24 March: T 104.21. The Applicants’ legal representatives in turn did not convey Mr Nash’s (not insignificant) change of opinion to the legal representatives of the Respondent, who heard about it for the first time while Mr Nash was in the witness box. As was accepted by Senior Counsel for the Applicants, this change of opinion should have been communicated to the Respondents once it was known. None of this is an example of proper compliance with the Expert Witness Code of Conduct (UCPR, Sch 7, cl 4). However, Mr Tomasetti SC was able to proceed with his cross examination in light of Mr Nash’s late change of opinion.
As to that change, Mr Nash felt there was evidence now of a “dual purpose” (T 96.27-28) or a “dual role or purpose to the R1 zoning” (T 100.10-11).
Mr Nash then decided to “keep away” from the use of the word “purpose”, and said that there was a “second role” of the Residue Land which, in addition to the relocation of Field 6 next to Field 5 allowing for “shared facilities”, now also included a “reduction in the size of the school”: T 100.34. It seems therefore that Mr Nash’s view became that not only was the Council “the driving force” for the open space land (T 102.42), but so too was the Department of Education or the Respondent Education Minister.
Despite this change of view, Mr Nash did however agree in cross examination that:

the Growth Centre SEPP 2006 and the Precinct SEPP 2021 were planning steps of the Planning Minister: T 111.8-15;

the Planning Minister obtained advice concerning the content of the Precinct SEPP 2021 from a range of government agencies, including (in relation to schools) the Education Minister: T 111.15-27;

that matters concerning local open space in the Precinct SEPP 2021 involved the Planning Minister taking advice from the Council as to what was required to meet the open space needs of the Box Hill community: T 111.29-35;

it was the Planning Minister’s decision as to where schools would go and how much land was needed for them: T 112.26-31;

in his First Nash Report [51] he had recognised that the “public purpose of the residue land is for the provision of local open space consistent with its RE1 Public Recreation zone, which would be the responsibility of the relevant local government authority”, that is, the Council, and that it was the “Minister for Planning[’s] … decision as to where the school would go and how much land would be required for it”: T 112.26-39;

he was not suggesting by his evidence that the zoning of Field 5 as RE1 local open space was driven by the school: T 121.39-42;

the zoning of Field 5 as RE1 had nothing to do with the school: T 122.9;

there were advantages in combining Fields 5 and 6 that were unrelated to the school – in that there is a greater area of open space, and there could be shared facilities and amenities: T 122.12-123.25; and

decisions in respect to planning in the Box Hill area ultimately rested on the Planning Minister: T 127.7-26. [52]
51. Exhibit B, p 711 at [4.4.10].
52. Exhibit K, p 246.

As for Mr Rowan, he was questioned as to why in [42] of his First Rowan Report he did not refer to a “reduction in the amount of land required for the school” in the quote extracted above at [79] in the Box Hill PP 2012. [53] He explained that in his view this was not relevant, because “it was the [Planning Department] and the Council that were making the decision of relocating Field 6”, and not the Respondent Education Minister or his department (T 137.4-42; 138.7-14; 138.38-139.13).
53. Exhibit 2, p 781.
Mr Rowan was also taken to section 3.11 of the Box Hill PP 2012 relating to schools, and to the fact that he had not referred to this paragraph which states:

3.11 Schools
The DP&I has worked closely throughout the planning process with the NSW Department of Education and Communities (DEC) to identify sites for public schools which satisfy DEC criteria.
The possible locations of future schools were not altered post exhibition, however the size of the proposed K-12 school on Terry Road has been reduced slightly in size. This resulted in a small increase in the amount of land that can be developed for residential purposes. Discussions with DEC have confirmed that the size of this school can be reduced on the basis that it is located adjacent to local public playing fields. The playing fields are to be owned and managed by Council, and used by the school during school hours, with public use outside school hours. [54]
54. Exhibit K, p 240.

When asked about this paragraph, Mr Rowan’s evidence was that he again saw no relevance in it, principally because the subject matter being discussed was a “local public playing field” rather than a school field, and placed particular emphasis on the words “the playing fields are to be owned and managed by the Council” (see generally T 140.20 – 143.5). Mr Rowan’s view was that “it was the council that determined that it wanted to place it’s playing fields … as close as possible to the schools”: T 162.27-29.
Although I am addressing the issue of the “public purpose for which the land was acquired”, it is convenient now to set out relevant aspects of the valuation evidence adduced at the hearing.

Valuation Evidence Relevant to the Public Purpose

As mentioned above at [3], in the joint expert report dated 19 June 2024 (Valuers’ First Joint Report), Mr Kenny and Mr Dyson reached agreement, inter alia, on the following matters:

the underlying zoning of the Acquired Land was R3 Medium Density Residential (as agreed by the town planners at [16] of their Planners’ First Joint Report); [55] and

that “but for the Public Purpose” the zoning of the Residue Land would remain RE1 Public Recreation. [56]
55. Exhibit G, p 1003 at [19].
56. Exhibit G, p 1004 at [21].

In his first report dated 6 June 2024 (First Kenny Report), Mr Kenny had expressed a different view regarding the Residue Land. He said in that first report he was:

… of the opinion, which is confirmed by the individual and joint expert planning reports of Messrs Nash and Rowan, the underlying zoning/alternate land use potential of the Acquired Property as the front part, and the Residue Land as the rear part, of a larger residential development site of some 4.358 hectares when absent the public purpose reservation is, wholly as –
R3 Medium Density Residential in accordance with the existing zoning of adjacent land to the north, south and opposite, as well as being mindful of the adjacent Medium Density Residential zoning shown on the Draft Indicative Layout Plan exhibited in October 2011

providing for an imminent potential for medium density development by way of subdivision into residential lots typical of the surrounding developing areas of Box Hill. [57]
57. Exhibit F, p 874 at [13].

Whether or not it influenced Mr Kenny’s opinion set out above, this paragraph contains factual inaccuracies. Mr Rowan had not expressed the opinion in the First Rowan Report that the underlying zoning of the Residue Land was R3 Medium Density Residential. He held this view only in relation to the Acquired Land. Further, in the Planner’s First Joint Report, Mr Nash and Mr Rowan had agreed that the public purpose for the acquisition of the Acquired Land was not relevant to the RE1 zoning of the Residue Land.
Mr Kenny went on in his first report to assess compensation under s 55(f) of the Just Terms Act for the decrease in value of the Residue Land “adopting the principle that the dispossessed owners of the Acquired Property would be entitled to sell any residue area of the Parent Property at its best achievable selling price/value at the date of acquisition despite it having become ‘landlocked’ as a result of the partial land acquisition by the [Department of Education]”. [58] He then suggested that:

[c]ompensation for a decrease in value of the ‘residue or other land’ is reasonably established by a financial analysis on working back from the ‘unaffected’ market value of the Residue Land addressing purchasing costs, holding costs, a profit and risk margin and unrecoverable selling or disturbance costs on eventual acquisition by the HSC which are likely or expected to be incurred by a hypothetical purchaser to establish the ‘affected’ market value of the Residue Land. The difference between the ‘unaffected’ market value of the Residue Land and the ‘affected’ market value of the Residue Land is considered to be a reasonable measure of compensation for Section 55(f). [59]
58. Exhibit F, p 875 at [18].
59. Exhibit F, p 875 at [19], and see also [136] to [148].

When cross examined, Mr Kenny agreed that in the Valuers’ First Joint Report he “abandoned” the opinion expressed in his First Kenny Report that there was a decrease in the value of the Residue Land as a result of the acquisition of the Acquired Land, and that compensation was owing to the Applicants because of this pursuant to s 55(f) of the Just Terms Act. However, he said in his evidence that he had ”abandoned it in error if that’s possible”: T 185.47. He said the error had occurred to him “a few weeks ago”: T 186.17. He agreed he took no steps to notify the Applicants’ legal representatives of this change of opinion. He agreed he had “failed in that” (T 187.10-28), and had failed to give consideration to the Expert’s Code in relation to this failure: T 187.28-34.
It can be noted then that both of the experts engaged by the Applicants had changes of opinion subsequent to the preparation by them of joint expert reports, with no compliance with the Expert Code of Conduct. Passing on from this and getting to the reasons for that change of opinion, Mr Kenny explained that he failed to address a “principle that [he] had formed in [his] mind”: T 191.15. He explained this principle in the following way:

It’s a principle in my mind that the dispossessed owner at the date of acquisition, having then the ownership of the residue land of 1.156(as said) hectares, they were still able to offer that for sale on the open market. Anyone, a hypothetical purchaser, a speculator, developer, because we’re assuming it’s zoned R3 then, Council are out of the picture because there’s a valuation of underlying exercise, they would say, “There’s a road that’s supposed to be there. It’s not there. We’ve been landlocked. When can we get access to that hypothetical R3 development site?” So, I value it unaffected on the residue land. But because we’re looking at it underlying R3, no longer RE1, I say, how long will it be before we can get to it? Speaking as a developer, the developer will pay less for that sort of land that has access issues and development timing being delayed, they will pay less than property which immediately has access: T 191.20-32.

While I do not mean this disrespectfully, it is not absolutely clear to me what the precise nature of the “principle” that Mr Kenny is referring to is, or what its bounds are. His position was perhaps not clarified by a question from me as to whether his s 55(f) determination of compensation was based on his assumption of landlocking (to which he agreed): T 191.34-37. I am not sure the issue of landlocking completely encapsulates (or is even relevant to) Mr Kenny’s “principle”, which I think has its origins more in [18] to [19] of his First Kenny Report, referred to above at [92] – a view that he abandoned in the Valuers’ First Joint Report, but then re-adopted for the purpose of his oral evidence at the hearing.
There was then this exchange in the evidence concerning Mr Kenny’s opinion that the Applicants were entitled to compensation under s 55(f) for a decrease in value of the Residue Land by reason of the carrying out of the public purpose for which the Acquired Land was acquired:

TOMASETTI: Mr Kenny, I'm going to return back to page 894A [substituted p 24 of Exhibit F (First Kenny Report)].
WITNESS KENNY: Yes.
TOMASETTI: I just want to understand the principled approach that you've adopted so that I can make submissions in relation to the principled approach. When you assess injurious affection, I'll call it that term, I think we're on common ground as to what you mean by that section 55(f) claim. You have assumed that the RE1 land at the date of acquisition was, in fact, zoned R3 medium density; is that right?
WITNESS KENNY: No, I haven't. No, I haven't. I've assumed that ‑‑
TOMASETTI: What zoning did it have immediately after the acquisition?
WITNESS KENNY: It had an RE1 zoning. However, knowing that it was going to be a future acquisition, it would be acquired on an underlying zoning of R3. There is still a hypothetical purchaser possibly out there who would know it would be acquired on an R3 basis at some time in the future. And that sometime in the future is encumbered now by the fact that it is landlocked, and he's got a potential R3 development site that he can't get to because he has no access.
TOMASETTI: But I don't understand, with respect, the logic of what you're saying for this reason, are you saying that the – firstly, as a matter of principle, you're identifying injurious affection as at the date of acquisition. Is that right?
WITNESS KENNY: Yes.
TOMASETTI: You're not determining what the injurious affection is today?
WITNESS KENNY: At the date of acquisition.
TOMASETTI: Are you saying that at the date of acquisition, if the RE1 land was offered for sale to the marketplace, that it would be purchased by a developer?
WITNESS KENNY: That's quite possible, yeah. It could only be – hypothetically ‑‑
TOMASETTI: Pausing there, are you saying that the RE1 land would be purchased by a developer? Yes or no?

WITNESS KENNY: Yes.
TOMASETTI: If it's purchased by a developer, it's being purchased as an in [sic] globo parcel to be developed for medium density purposes, residential purposes. Is that the understanding you ask us to have?
WITNESS KENNY: Yes.
TOMASETTI: You appreciate that under zoned RE1, that that type of development is prohibited on the land? You appreciate that, don't you?
WITNESS KENNY: I do.
TOMASETTI: But nevertheless, you say the purchaser would be a developer who would go through this process in his mind of working out that at the date of acquisition, the RE1 land was landlocked. Is that correct?
WITNESS KENNY: Yes.
TOMASETTI: You know that a couple of months after the land was acquired, an easement was granted over the SP2 land in favour of the RE1 land, don't you?
WITNESS KENNY: I'm aware of that.
TOMASETTI: You're ignoring that because you're looking at the point in time of compulsory acquisition; is that right?
WITNESS KENNY: Yes, and ‑‑
…
TOMASETTI: But you're ignoring the easement altogether, I suggest. You told us a moment ago, you were looking at a point in time of the date of acquisition of the school site?
WITNESS KENNY: Yes, I'm ignoring that ‑‑
TOMASETTI: At that date, you say there was no access to the RE1 land, so it was landlocked?
WITNESS KENNY: Correct.
TOMASETTI: You're saying at that date, if it was offered for sale, a developer would come along and purchase it?
WITNESS KENNY: Correct. A developer or – we're talking about a developer here because we're ignoring the fact that it's going to be acquired by the Hills Shire Council.
TOMASETTI: You're ignoring that fact, aren't you?
WITNESS KENNY: Yes, yes.
TOMASETTI: You're saying a developer would come along and buy this land, correct?
WITNESS KENNY: Correct.
TOMASETTI: He would buy it in order to develop it for medium-density residential purposes in due course, correct?
…
WITNESS KENNY: …It's an underlying zoning calculation. This developer, this speculator, knows it's going to be acquired by Hills Shire Council sometime in the future, okay? It's going to be acquired on the basis of an R3 underlying zoning.
TOMASETTI: I thought you told the Court a moment ago --
HIS HONOUR: I thought you said we ignore the Council?
TOMASETTI: -- that you ignore the Council and that you assume that the assumption you make --
WITNESS KENNY: That's...
TOMASETTI: Let me finish the question, sorry.
WITNESS KENNY: Yes, sorry.
TOMASETTI: I thought you were asking the Court only a moment ago to ignore the Council altogether and to assume that a developer would buy the land for the purposes of developing it for medium-density purposes. That's what you said, wasn't it?
WITNESS KENNY: Yes, and that is how you assess an underlying zoning when a property is subject to future acquisition by an authority: T 197.33 – 200.31.

Whatever conclusion can be drawn from this evidence, it does not appear that Mr Kenny was suggesting that the public purpose of the acquisition of the Acquired Land caused the RE1 zoning of the Residue Land. There was then this exchange with me concerning what is said to be the underlying zoning of the Residue Land:

HIS HONOUR: Just so I understand what you've done … how is it you say that the underlying zoning, R3 zoning – so you're assuming when the hypothetical developer buys it, it's still got its RE1, but when the Council buys it off the developer, it'll be on the basis of the underlying R3 zoning, correct?
WITNESS KENNY: Yes.
HIS HONOUR: So far, yes? But how is that underlying zoning influenced by the proposal to carry out the public purpose acquisition of the acquired land?
WITNESS KENNY: This residue land, it's zoned R3, and into the future – I'm sorry, RE1 – and into the future, sometime into the future, it will be acquired by Council. At that point, the underlying zoning will be R3.
HIS HONOUR: That might be right, but how does the public purpose acquisition of the acquired land have anything to do with that?
WITNESS KENNY: It doesn't have anything: T 205.1-21.

All I can take from this is agreement by Mr Kenny that whatever the basis is for his opinion regarding there being a decrease in value to the Residue Land, the public purpose for the acquisition of the Acquired Land had nothing to do with it.

Applicants Submissions on Public Purpose

In their outline of opening submissions, the Applicants contend that the “true proposed public purpose of the acquisition… was to create a public school on the Acquired Land which had recreational land at its rear upon the Residue Land”. [60] They submit that the RE1 zoning of the Residue Land “must be disregarded pursuant to s 56(1) because the RE1 zoning was caused by the carrying out of or the proposal to carry out the public purpose for which the land was to be acquired”. [61]
60. Applicants Opening Submissions (AOS) at [4].
61. AOS at [4].
Perhaps it is a subtle difference, but in their closing submissions, the Applicants’ contention was that:

“the public purpose or the proposed public purpose for which the Respondent acquired the Acquired Land was to create a school adjoining open space such that the RE1 zoning of the Residue Land should properly be understood as being by reason of the carrying out of or proposal to carry out the Respondent’s public purpose for which the land was acquired”. [62]
62. ACS at [2].

This public purpose, the Applicants submit, was well within the power given to the Respondent in s 125(1) of the Education Act, which provides that “the Minister may, for the purposes of this Act or jointly for those purposes of or associated with public education or recreation” acquire land by compulsory processes.
The evidence that the Applicants point to in support of the public purpose that they claim the Acquired land was acquired for includes the following:

the Respondent’s long held desire of acquiring land for schools and associated playing fields, including for the proposed K-12 school on Terry Road; [63]
63. Exhibit A, pp A1, A26.3; ACS at [16a].

an increase in the size of the proposed school made by the Planning Department “as a result of the Respondent’s input”; [64]

the discussions which began at least by January 2012 between the Department of Planning and the Council regarding school sizes and access to playing fields which also involved discussions with the Education Department; [65]

discussions from at least 27 February 2012 between the Planning Department and the Respondent regarding the location of the proposed school sites in the Box Hill Precinct “adjacent to Council owned open space, with the result being ultimately a reduced area required for DE&C acquisition”; [66]

the moving of Field 6 by the Department of Planning so that it was adjacent to the Acquired Land which had the effect of reducing the overall size of land zoned SP2; [67] and

the simultaneous zoning of the SP2 land (the Acquired Land) and the RE1 land (the Residue Land) on 5 April 2013 under the Growth Centre SEPP 2006 pursuant to the Land Acquisition Map. [68]
64. ACS at [16b]-[c]; Exhibit A pp A26.6-26.7; Exhibit K p 220.
65. Exhibit A, pp A27, A36, A39.
66. Exhibit A, p A51.
67. ACS at [16k].
68. ACS at [17].

The Applicants then submit that the Respondent’s public purpose remained unchanged in the processes leading up to the acquisition. The Applicants say this is evidenced by the Respondent’s ongoing desire for the school to be adjacent to public playing fields that can be used by the proposed school, and the discussions held for a period of time between the Education Department and the Second Applicant concerning the possibility of acquiring the entire Parent Parcel, and not just that part representing what ultimately became the Acquired Land. [69] Just pausing here, it can be noted that the Respondent initially objected to any evidence concerning discussions between officers of the Education Department and the Second Applicant being admitted into evidence, relying on s 10A of the Just Terms Act, which relevantly provides:
69. ACS at [18a]-[r], [22] and the various documents referred to therein.

10A Minimum period of negotiation for acquisition by agreement before initiation of compulsory acquisition process
(1) This section applies to land that is affected by a proposal for acquisition by an authority of the State, other than a proposal to acquire—
(a) Crown land, or
(b) an easement, or right to use land, under the surface for the construction or maintenance of works, or
(c) a stratum under the surface for the construction of a tunnel.

(2) The authority of the State is to make a genuine attempt to acquire the land by agreement for at least 6 months before giving a proposed acquisition notice.
…
(7) Nothing in this section gives rise to, or can be taken into account in, any civil cause of action.
(emphasis added)

In further support of his objection, Mr Tomasetti SC relied on the judgment of Hammerschlag J in Desane Properties Pty Ltd v State of New South Wales [2018] NSWSC 553, where his Honour rejected the notion that the negotiation period referred to in s 10A(2) is “the occasion upon which the public purpose is communicated to the landowner”. His Honour rejected this “because s 10A(7) provides that nothing in the section gives rise to, or can be taken into account in, any civil cause of action”: Desane at [240]. Reliance was also placed on Justice Pritchard’s judgment in The Eddie Arnott Corporation Pty Ltd v Sydney Metro [2025] NSWLEC 12, where her Honour, founded on s 10A(7) of the Just Terms Act, upheld an objection to evidence in an affidavit relating to without prejudice offers of compromise and other communications between the parties during the s 10A(2) period: Eddie Arnott at [22] to [31].
Mr Tomasetti SC subsequently withdrew his objection to evidence concerning negotiations relating to a possible acquisition by the Respondent of the Parent Parcel prior to a decision being made by the Respondent to acquire the Acquired Land: T 260.6-7. Much of this evidence is found in the Affidavit of the Second Applicant dated 21 November 2023 from [39] to [64] (and relevant parts of the Exhibit to her affidavit relating to those paragraphs). [70]
70. See also Affidavit of Mark George Shumsky dated 20 November 2023 from [8]-[27].
I am not certain that because Mr Tomasetti SC withdrew his objection that this ends the matter. It seems to me that s 10A(7) may preclude this material being admitted and relied on whether or not objection is taken. Ultimately though this, in my view, is a side-issue, because (as set out below) any consideration given by the Respondent to acquiring the Parent Parcel as distinct from the Acquired Land is not in my view of relevance to the carrying out of or proposal to carry out the public purpose for which the Acquired Land was acquired, and it is irrelevant in my view to the zoning of the Residue Land as RE1, which was a decision of the Planning Minister (and not the Respondent Education Minister) made in consultation with the Council regarding its needs for providing public open space with public playing fields.

Respondent’s Submissions

The Respondent submits that the public purpose for which the land was acquired “was to provide a school on the acquired land”. [71] The Respondent points to the fact that the Acquired Land had been zoned SP2 Infrastructure (School) by the Planning Minister, not the Respondent Education Minister. While the Education Minister clearly has power to “acquire land to be used by a school for recreation”, the Respondent does not have power to “acquire land to be used for local open space by the public generally”. [72] The mere fact that “school students may be able to use the local open space and sporting complex planned to be behind the school one day does not change the fact that the Acquired Land was acquired only for a school”. [73]
71. RCS at [41].
72. RCS at [40(f)].
73. RCS at [47].
The Respondent submits that the movement of Field 6 to a site next to Field 5 was not caused by any part of the public purpose for which the Acquired Land was acquired. Rather, it was a decision of the Planning Minister, reflecting a desire of the Council to move that field because where it was originally planned to be was “constrained by steep topography”, and moving Field 6 next to Field 5 had obvious benefits in terms of greater size for public playing fields, and for efficiencies such as shared facilities and amenities. [74]
74. see RCS at [53]-[54]; Exhibit K, p 230.

Resolution on Issue 1: What was the public purpose for the acquisition?

In Goldmate at [71], the Court of Appeal set out the following four step process for the assessment of market value under s 56(1)(a) of the Just Terms Act:

(1) the identification of the acquiring authority;
(2) the identification, by reference to the empowering legislation, of the public purpose or purposes for which the acquiring authority (identified in (1) above) has the power to acquire land;
(3) the identification of the acquiring authority's public purpose in acquiring the land, which must fall within the purpose or range of purposes identified in (2) above; and
(4) the determination of the question, which is one of fact, whether there has been any increase or decrease in the value of the land caused by the carrying out of, or the proposal to carry out, the public purpose for which the land was acquired, identified in (3) above (any such increase or decrease is to be disregarded).

The Respondent’s acquisition of the Acquired Land was stated in the Gazette to be for the purposes of the Education Act. Given there is no doubt as to the identity of the acquiring authority here, the first matter of relevance for the identification of the public purpose for which the land was acquired is the public purpose or purposes for which the Respondent Education Minister has power to acquire land: Goldmate at [71(2)]; Walker Corporation Pty Limited v Sydney Harbour Foreshore Authority (2008) 233 CLR 259; [2008] HCA 5 at [57]; and s 4(1) Just Terms Act.
Section 125(1) of the Education Act empowers the Respondent to acquire land by compulsory processes “for the purposes of [that] Act or jointly for those purposes and purposes of or associated with public education or recreation”. The Education Minister therefore can acquire land either for:

the purposes of the Education Act (which relevantly for the Acquired Land would be for the “establishment of [a] government school” (see Education Act s 5(6)); or

for the purposes of the Education Act jointly with purposes associated with “public education or recreation”.

Whatever the bounds of this power is in relation to the acquisition of land for “recreation” (associated with the purposes of the Education Act), it does not in my view extend to a power to acquire land for purposes of merely providing public open space in a local government area. That would miss out entirely the need for the acquisition to serve the purpose of the Education Act.
As to the third step outlined in Goldmate (“the identification of the acquiring authority’s public purpose in acquiring the land”) the facts outlined in the following paragraphs are of most relevance.
First, the zoning decisions in relation to the Acquired Land and Residue Land were decisions of the Planning Minister, and not the acquiring authority (the Education Minister). The Planning Minister’s decision to zone the Acquired Land SP2 Infrastructure (School), and the Residue Land RE1 Public Recreation (made on 5 April 2013) were no doubt driven by the post exhibition report for the Box Hill Industrial Precinct Plan – the Box Hill PP 2012. This report represents the last point of the planning process before planning decisions were made by the Planning Minister. It was this report that evidences the Council’s determination of a need for more active open space – that is, playing fields – to meet the future needs of the Box Hill community. The fact that this report recommends that “wherever possible” open space and recreation facilities be “co-located with school sites” [75] is not evidence of a decision or purpose of the Respondent Education Minister, nor can it be seen to be related to that Minister’s public purpose for acquiring the Acquired Land. It is merely a function of a normal planning process. So too, for that matter, is the decision to have open space and recreational facilities co-located with ”drainage infrastructure”.
75. Exhibit K, p 230.
Secondly, as to the relocation of Field 6 to a new location behind the proposed K-12 school and next to Field 5, this was driven by the fact that in its prior location Field 6 “was constrained by steep topography”, and that moving it would enable a rationalisation of facilities. [76] This again reflects a normal planning process, and is not a decision of the Respondent Education Minister. It would hardly be sensible planning by the Planning Minister (consulting with the Council) to have a proposed playing field on “steep topography”, whereas there are obvious benefits in locating Field 6 next to another parcel of land identified (by the Planning Minister and the Council) for public local space, thereby creating a greater area, and with the availability of shared facilities. The fact that this decision of the Planning Minister might mean that less land was required for the purposes of the school does not make this a decision of the Respondent Education Minister, nor does it support the contention that the Education Minister’s acquisition of the SP2 zoned land for the “purposes of the Education Act” was more than for the purposes of a school being built on that land. Nor has the proposal to carry out that public purpose (or the carrying out of it) caused the Residue Land to be zoned RE1 instead of R3 Medium Density Residential. The Residue Land was zoned RE1 because the Planning Minister, in consultation with the Council, accepted it was needed for public open space.
76. Exhibit K, p 230.
Thirdly, the fact that the Planning Department had consultations with the Education Department regarding where future schools should be located in the Box Hill area, including that the proposed K-12 school relevant to these proceedings should be located adjacent to local public playing fields (including playing fields expanded in size by the relocation of Field 6), does not make the planning decision here that of the Respondent Education Minister, or change the fact that the zoning of the RE1 land was a decision of the Planning Minister made in consultation with the Council, so as to meet the Council's desire for additional public open space to accommodate the future needs of the local community (as evidenced in the Council's Recreation Strategy referred to above at [38]-[40]).
As to the Respondent Education Minister, the public purpose for which he acquired the Acquired Land was for the purposes of a school. That the school is adjacent to or near land zoned for public open space (and for the proposed Sunny Hill Parkway Sports Complex), and may in the future be usable by the students of the proposed school (albeit on land that will ultimately be operated and owned by the Council) does not make this part of the proposal to carry out the public purpose acquisition of the SP2 zoned Acquired Land. It just adds to the desirability of acquiring the Acquired Land that is near land zoned for public open space, and which could ultimately be acquired by the Council.
In short then, I am in agreement with the agreed position of Mr Nash and Mr Rowan in the Planners’ First Joint Report. That is, the public purpose for the acquisition by the Respondent Education Minister of the Acquired Land “did not influence or cause the application of [the Residue Land’s] RE1 zoning”. [77]
77. Exhibit C, p 801 at [17].
Although obvious, for completeness, I do not accept the correctness of Mr Nash’s subsequent (and late) change of heart. The fact that the proposed K-12 school might require less land if it is located near or adjacent to public playing fields is not some aspect of the public purpose acquisition that has determined or caused the zoning of the Residue Land, for the reasons expressed above. The Residue Land was zoned RE1 as a result of a decision of the Planning Minister in conjunction with the Council so as to provide for future public open space needs of the community. It was not zoned that way as part of the proposal to carry out or the carrying out of the Education Minister’s public purpose acquisition of the Acquired Land for a school.

The finding that the public purpose of the acquisition was for the purposes of a school causes no change to the determination of market value of the Acquired Land pursuant to s 56(1)(a) of the Just Terms Act, (see below at [125]-[129]).
However, my conclusion regarding the public purpose does mean that the claim under s 55(f) of the Just Terms Act fails. There has been no decrease in the value of the Residue Land caused by the carrying out of the public purpose for which the Acquired Land was acquired.

Resolution on Issue 2: Claim Under s 55(f) for a Decrease in Value to the Residue Land

As set out above for Issue 1, in my view the carrying out of, or proposal to carry out the public purpose acquisition of the Acquired Land was immaterial to the RE1 zoning of the Residue Land. That land was zoned for public open space by the Planning Minister for the Council’s purposes. The public purpose of the acquisition of the Acquired Land was for the purpose of a school, and has caused no impact on the value of the Residue Land.
In their closing submissions, the Applicants contend that the Respondent’s public purpose (in relation to which I have found against the Applicants) “has decreased the value of the Residue Land in two ways”. [78] The first way is based on the contention that the Respondent’s public purpose acquisition of the Acquired Land caused the Residue Land to be zoned RE1 when it would otherwise have been zoned for residential purposes. I have rejected this contention. The second way the compulsory acquisition is said to have caused a decrease in value of the Residue Land is that it “caused the landlocking of the Residue Land by acquiring the land without a workable easement”. [79] It is said that “a hypothetical purchaser would not be able to use the easement for access to the Residue Land because that purchaser would have no right to be in possession of or reside on the Acquired Land.”
78. ACS at [33].
79. ACS at [37].
It is not clear to me to what extent this “landlocking” argument depends on my finding that the public purpose is immaterial to the zoning of the Residue Land. To the extent it might be contended to have a life beyond this, I would reject any claim for compensation under s 55(f) of the Just Terms Act for these reasons:

the Residue Land is not landlocked. The Easement has been granted;

at the date of acquisition, it was known that the Easement would be granted (see [20]-[23] above);

the alleged “unworkability” of the Easement was not “plainly observable” [80] to me on the view. There was no expert evidence before me about this. The Residue Land is neither legally landlocked, nor in my view physically landlocked. Access to the Residue Land by means of the Easement might be to a degree challenging, but no evidence before me established it was not possible; and

there was no valuation evidence before me concerning any reduction in the value of the Residue Land as a result of the Easement.

80. ACS at [37].

Resolution on Issue 3: Market Value of the Acquired Land

The market value of the Acquired Land is to be determined on the basis of its highest and best use as at the date of acquisition: Turner v Minister of Public Instruction (1956) 95 CLR 245; [1956] HCA 7 and Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 167 ALR 575. Parties are assumed to be “perfectly acquainted with the land, and cognisant of all circumstances which might affect… value” Spencer v Commonwealth (1907) 5 CLR 418 at 441; [1907] HCA 82. The Court must give the benefit of any doubt to the dispossessed land owner in determining the market value of the acquired land: Richardson v Roads and Traffic Authority (NSW) (1996) 90 LGERA 294.
In this case, there is no dispute between the parties’ experts about the market value of the Acquired Land. Mr Kenny and Mr Dyson reached agreement in the Valuers’ First Joint Report (Exhibit G) and the Valuers’ Second Joint Report (Exhibit J) that what they describe as the “underlying zoning” of the Acquired Land is R3 Medium Density Residential (as was also agreed by the planning experts in the Planners’ First Joint Report).
Both Mr Kenny and Mr Dyson adopted the direct comparison approach to determine the value of the subject property. [81] It is well established that, if comparable sales are available, the direct comparison approach is the conventional method of valuation: Adams v Valuer General [2014] NSWLEC 1005 at [28] citing Graham Trillby Pty Ltd v Valuer General [2009] NSWLEC 1087 at [41]; Redeam Pty Ltd v South Australian Land Commission (1977) 17 SASR 508; (1977) 40 LGRA 151 at 156; Riverbank Pty Ltd v Commonwealth (1974) 48 AJLR 483 at 484; Marroun v Roads and Maritime Services [2012] NSWLEC 199 at [196]; El Boustani v Minister Administering the Environmental Planning and Assessment Act 1979 [2012] NSWLEC 266 at [23]; Tenstat Pty Limited v Valuer General / Woolworths Limited v Valuer General [2012] NSWLEC 1361 at [35].
81. Exhibit F, p 891; Exhibit 4, pp 954-956.
Further, Mr Kenny and Mr Dyson applied the direct comparison approach in a manner consistent with the Court’s decision in Adams v Valuer General [2014] NSWLEC 1005. [82]
82. Exhibit F, p 917; Exhibit 4, p 956.
I accept the accumulation, analysis, adjustment and application of comparable sales evidence in the direct comparison approach adopted by Mr Kenny and Mr Dyson. As judicial valuer, I therefore accept their agreed rate of $950 per square metre, [83] and their assessment of market value of the Acquired Land of $27,000,000.
83. Exhibit G, pp 1003, 1007 at [19], [37].

Issue 4: Disturbance

The parties have reached agreement in respect to the following disturbance claims made by the Applicants:

(a) Pursuant to s 55(e) and s 60 (disadvantage resulting from relocation): $85,350.00

(b) Section 59 (1)(a) (legal costs): $61,654.00

(c) Section 59(1)(b) (valuation fees): $21,230.00

The other disturbance claims that remain pressed by the Applicants were the following:

(a) Section 59 (1)(d) (stamp duty): $294,500.00

(b) Section 59(1)(f) (“financial costs reasonable incurred (or that might be reasonably incurred) relating to the actual use of the land”): $1,152,493.00

In relation to the claims made under s 59(1)(d) and (f), the Applicants accepted that they were based on the Court finding that the carrying out of, or proposal to carry out, the public purpose for which the Acquired Land was acquired had caused the Residue Land to be zoned RE1 when it would otherwise have been zoned R3 Medium Density Residential. [84]
84. AOS at [28]-[29]; ACS at [45].
The Applicants argued that in these circumstances, a “counterfactual” arose, whereby “the Residue Land would have been zoned R3” and the Applicants “existing use of the land as a residence and venue for their greyhound training and racing activities could have continued post-acquisition on the Residue Land”. [85] In the Applicants’ Closing Submissions, the relevant counterfactual was said to be “where the Acquired Land was sold to a developer and not acquired for a school adjacent to a recreational area, the Applicants would have been able to relocate their residence and the infrastructure supporting their greyhound racing ventures onto the Residue Land”. [86]
85. AOS at [29].
86. ACS at [45].
In circumstances where I have found, in accordance with the agreement of the planning experts in the Planners’ First Joint Report, that the proposal to carry out the public purpose for which the Acquired Land was acquired had no influence over the zoning of the Residue Land, the parties accepted that these additional disturbance claims would be defeated by s 61(b) of the Just Terms Act, which is in the following terms:

If the market value of land is assessed on the basis that the land had potential to be used for a purpose other than that for which it is currently used compensation is not payable in respect of - … (b) any financial loss that would necessarily have been incurred in realising that potential.

Section 61(b) precludes the Applicants from claiming the above disturbance loss (which constitutes “financial loss” for the purposes of this section [87] ) when “the compensation paid under s 55(a) is assessed on a higher value than reflected by the current use of the land.” [88] Given the Acquired Land, which is currently zoned SP2, was assessed “on the basis that the land had potential to be used for a purpose other than that for which it is currently used,” in this case R3 Residential, s 61(b) renders inoperative the Applicants’ claims for financial loss. I find that the disturbance loss would “necessarily have been incurred” in realising the potential of the underlying zoning and therefore s 61(b) is engaged to deny the disturbance claims. [89]
87. See Roads and Maritime Service (NSW) v United Petroleum Pty Ltd (2019) 99 NSWLR 279; [2019] NSWCA 41 at [39] citing Sydney Water Corporation v Caruso [2009] NSWCA 391 at [186].
88. Respondent’s Outline of Submissions at [30].
89. Respondent’s Outline of Submissions at [30]-[31].
My findings in relation to the public purpose of the acquisition here, and my findings in relation to disturbance, mean that it is unnecessary for me to decide an issue that was also raised by the Respondent in relation to the disturbance claim, namely that there was no evidence to establish that the Applicants’ uses of the Acquired Land – in particular, its use as a greyhound training and breeding operation (as well as other uses including grazing livestock and animal shelters) – were lawful uses. While it is unnecessary for me to decide, I have real doubt whether these uses were lawful, and I am far from certain that the SEPP (Exempt and Complying Development Codes) 2008 (NSW) assists the Applicants. Nevertheless, because of my findings on public purpose and disturbance, I will not decide this issue.

Conclusion

In conclusion then:

for the reasons outlined above, I am of the view that the Acquired Land was acquired by the Respondent Education Minister for the purposes of a school. The RE1 zoning of the Residue Land was not caused by the carrying out of, or the proposal to carry out, the public purpose for which the Acquired Land was acquired;

accordingly, no compensation is payable under s 55(f) of the Just Terms Act, as the carrying out of, or the proposal to carry out the public purpose for which the Acquired Land was acquired has not caused a decrease in the value of the Residue Land;

further, compensation is not payable for the disturbance claims made pursuant to s 59(1)(d) and (f) of the Just Terms Act, by reason of s 61(b) of that Act; and

I am satisfied that the assessment by the valuation experts of the market value of the Acquired Land under s 56(1)(a) of the Just Terms Act of $27,000,000 is the appropriate market value, and I note the amounts agreed between the parties concerning the claims for legal fees, valuation fees, and the disadvantage resulting from relocation.

Orders

In proceedings 2023/00308805, compensation under Pt 3 Div 4 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW), for the compulsory acquisition of the Applicants’ interest in the land known as Lot 299 of DP 1285364 (also known as 50 Terry Road, Box Hill) is determined in the sum of $27,168,234.00 plus statutory interest.
Costs are reserved.
Should the parties agree on an order for costs, I will make that order upon notification of the agreement, which should be provided to me within seven days of the date of this judgment. If the parties are unable to reach an agreement as to costs, they should notify me within seven days of the date of this judgment, and I will make any further necessary orders to enable that dispute to be resolved.

Addendum and Further Orders (13 June 2025)

I gave judgment and made orders in these proceedings on 5 June 2025 and reserved costs. As the parties have now reached agreement in relation to costs, I make the following further order:

The Respondent is to pay the Applicants' costs of the proceedings as agreed or assessed.

**********

Endnotes

Amendments

13 June 2025 - Addendum and Further Orders added at [138].

Decision last updated: 13 June 2025

Medium Neutral Citation:	Nicolaou v Minister for Education and Early Learning [2025] NSWLEC 56
Hearing dates:	26-28 March, 1 April 2025
Date of orders:	13 June 2025
Decision date:	05 June 2025
Jurisdiction:	Class 3
Before:	Beasley J
Decision:	(1) In proceedings 2023/00308805, compensation under Pt 3 Div 4 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW), for the compulsory acquisition of the Applicants’ interest in the land known as Lot 299 of DP 1285364 (also known as 50 Terry Road, Box Hill) is determined in the sum of $27,168,234.00 plus statutory interest. (2) Costs are reserved. (3) Should the parties agree on an order for costs, I will make that order upon notification of the agreement, which should be provided to me within seven days of the date of this judgment. If the parties are unable to reach an agreement as to costs, they should notify me within seven days of the date of this judgment, and I will make any further necessary orders to enable that dispute to be resolved. See further order at [138].
Catchwords:	COMPULSORY ACQUISITION — Objection to compensation offered pursuant to s 66 of Land Acquisition (Just Terms Compensation) Act 1991 (NSW) — Valuation — Public purpose for which the land acquired — Rezoning of land — Disturbance claim — Easement
Legislation Cited:	Conveyancing Act 1919 (NSW), s 88B Education Act 1900 (NSW) ss 5, 6, 125 Environmental Planning and Assessment Act 1979 (NSW) s 3.15 Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ss 4, 10A, 11, 54, 55, 56, 59, 61, 66 Baulkham Hills Local Environmental Plan 1991 Baulkham Hills Local Environmental Plan 2005 Box Hill and Box Hill Industrial Growth Centre Precincts Development Control Plan 2013 Box Hill and Box Hill Industrial Precinct Plan 2012 Box Hill Growth Centre Precincts Development Control Plan 2018 Hills Local Environmental Plan 2019 State Environmental Planning Policy (Exempt and Complying Development Codes) 2008 State Environmental Planning Policy (Precincts – Central River City) 2021 State Environmental Planning Policy (Sydney Region Growth Centres) 2006 Uniform Civil Procedure Rules 2005 Sch 7, cl 4, r 28.2
Cases Cited:	Adams v Valuer General [2014] NSWLEC 1005 Boland v Yates Property Corporation Pty Ltd [1999] HCA 64; (1999) 167 ALR 575 Desane Properties Pty Ltd v State of New South Wales [2018] NSWSC 553 El Boustani v Minister Administering the Environmental Planning and Assessment Act 1979 [2012] NSWLEC 266 Goldmate Property Luddenham No 1 Pty Ltd v Transport for NSW [2024] NSWCA 292 Graham Trillby Pty Ltd v Valuer General [2009] NSWLEC 1087 Marroun v Roads and Maritime Services [2012] NSWLEC 199 Redeam Pty Ltd v South Australian Land Commission (1977) 17 SASR 508; (1977) 40 LGRA 151 Richardson v Roads and Traffic Authority (NSW) (1996) 90 LGERA 294 Riverbank Pty Ltd v Commonwealth (1974) 48 AJLR 483 Roads & Traffic Authority (NSW) v Perry (2001) 52 NSWLR 222; [2001] NSWCA 251; (2001) 116 LGERA 244 Roads and Maritime Service (NSW) v United Petroleum Pty Ltd (2019) 99 NSWLR 279; [2019] NSWCA 41 Spencer v Commonwealth (1907) 5 CLR 418; [1907] HCA 82 Sydney Metro v G & J Drivas Pty Ltd (2024) 113 NSWLR 429; [2024] NSWCA 5; (2024) 258 LGERA 197 Sydney Water Corporation v Caruso [2009] NSWCA 391 Tenstat Pty Limited v Valuer General / Woolworths Limited v Valuer General [2012] NSWLEC 1361 The Eddie Arnott Corporation Pty Ltd v Sydney Metro [2025] NSWLEC 12 Turner v Minister of Public Instruction (1956) 95 CLR 245; [1956] HCA 7 Walker CorporationPty Limited v Sydney Harbour Foreshore Authority (2008) 233 CLR 259; [2008] HCA 5
Texts Cited:	Hills Future 2036 – Local Strategic Planning Statement, October 2019 Hills Shire Council Recreation Strategy
Category:	Principal judgment
Parties:	Michael Nicolaou (First Applicant) Rita Nicolaou (Second Applicant) Minister for Education and Early Learning (Respondent)
Representation:	Counsel: Mr S Prince SC and Ms T Wong (First and Second Applicant) Mr P Tomasetti SC and Ms A Hemmings (Respondent) Solicitors: Stacks Law Firm (First and Second Applicant) HWL Ebsworth (Respondent)
File Number(s):	2023/00308805
Publication restriction:	Nil

(a)	Pursuant to s 55(e) and s 60 (disadvantage resulting from relocation):	$85,350.00
(b)	Section 59 (1)(a) (legal costs):	$61,654.00
(c)	Section 59(1)(b) (valuation fees):	$21,230.00

(a)	Section 59 (1)(d) (stamp duty):	$294,500.00
(b)	Section 59(1)(f) (“financial costs reasonable incurred (or that might be reasonably incurred) relating to the actual use of the land”):	$1,152,493.00