Townsville City Council v Department of Main Roads

Townsville City Council brought an action against the Department of Main Roads concerning the resumption of certain land and the determination of compensation. The dispute centred on whether the development of Parcel B by Townsville City Council would have a significant adverse impact on a State-controlled road, thereby requiring the construction of an alternative river crossing via a developer bridge. The court was required to determine whether the respondent had the power to decide the dispute as to title, the principles governing the determination of compensation for enhancement, the admissibility of certain evidence, and the valuation of the resumed land.

The court found that it had no power to decide the dispute as to title but could decide if a particular claim fell within its jurisdiction. The court held that the developer, who held a development agreement with the owner, did not have the right to claim compensation for the development of Parcel B. The court also found that the onus of proof for enhancement lay with the constructing authority and that it was permissible to confirm a foresight, not prove a hindsight. The court considered the impact of the Transport Infrastructure Act on the valuation of the resumed land and held that the hypothetical prudent purchaser would assess the risk of contribution by looking to marketplace evidence. The court also held that the application of the Pointe Gourde principle required the court to ignore the existence of the resumption scheme but could consider the need which the proposed scheme was designed to address.

The court held that the use of discounted cash flow in the valuation of the resumed land was not wholly objectionable but not used in the instant case. The court also held that the use of after-date sales was general requirement for sale to be proximate to the date of valuation but could be used to show the level of diminution in value for a particular cause, such as noise. The court found that the claimant's retained land was not adversely affected by the resumption and that there was no jurisdiction to award compensation for additional external water costs. The court also held that professional fees in claim preparation were not allowable if not sufficiently precise in matter and amount. The court held that GST on disturbance items was payable if the constructing authority agreed to pay if the Australian Taxation Office invoiced the claimant.

The court held that interest on the award was not granted if the claimant was dilatory in making the claim but allowed interest in the current case due to the lengthy delay being justified. The court ordered that the respondent pay compensation in the amount of Five Million Three Hundred and Eighty-four Thousand and Thirty Dollars and Fifty-three Cents ($5,384,030.53) and interest at the rate of 6.75 per centum per annum calculated from 13 May 1994 to 9 June 1995 and at a rate of 6.5 per centum per annum from 10 June 1995 up to and including the day immediately preceding the date of payment.