Rockdale City Council v Micro Developments Pty Ltd

Rockdale City Council appealed and Micro Developments Pty Ltd cross-appealed from a judgment of the Supreme Court of New South Wales concerning a claim in negligence. The dispute arose from the Council's misstatement of the zoning of a property purchased by Micro Developments, which prevented the intended development of home units. Micro Developments retained the property for several years until the zoning was subsequently changed, allowing for development. The core of the litigation concerned the assessment of Micro Developments' loss resulting from the Council's negligent misstatement.

The primary legal issues before the Court of Appeal were whether Micro Developments had failed to mitigate its loss by retaining the property for an extended period, and whether the trial judge had erred in assessing the loss by considering the reduction in Micro Developments' capacity to undertake other developments due to its capital being tied up in the subject property. The court also considered issues relating to the inclusion of tax and interest in the assessment of damages.

The Court of Appeal affirmed the trial judge's findings, holding that it was open to the judge to make a broad assessment of Micro Developments' loss. The court reasoned that the retention of the property was not necessarily a failure to mitigate, particularly given the subsequent change in zoning which ultimately allowed for development. Furthermore, the court accepted that the trial judge was entitled to consider the impact of the capital being tied up in the property on Micro Developments' ability to pursue other development opportunities, as this represented a real loss flowing from the Council's negligence. The court found no error in the trial judge's approach to the assessment of damages, including the consideration of tax and interest.

Consequently, both the appeal by Rockdale City Council and the cross-appeal by Micro Developments Pty Ltd were dismissed.