TMG Developments Pty Ltd v Roads and Maritime Services [2014] NSWLEC 117

Land and Environment Court New South Wales

Medium Neutral Citation: TMG Developments Pty Ltd v Roads and Maritime Services [2014] NSWLEC 117 Hearing dates: 28-30 April 2014; 1-2, 5-9, 12-13, 16, 19-20, 22-23 May 2014 Decision date: 07 August 2014 Jurisdiction: Class 3 Before: Biscoe J Decision: Determination of compensation in the sum of $15,324,830 for the compulsory acquisition of the applicant's land. The respondent is to pay the applicant's costs. Catchwords: COMPULSORY ACQUISITION - compensation - applicant was lessee from respondent government agency under 99 year headlease of Manly Wharf complex comprising a ferry terminal, eastern pier and retail centre - respondent compulsorily acquired applicant's headlease interest in ferry terminal and eastern pier leaving applicant with retail centre residue - ultimate valuation issue is value of applicant's acquired headlease interest as at the 2012 acquisition date - valuation methodology capitalisation of net income in before and after acquisition scenarios - numerous issues - main sub issue: annual market rental value of the terminal under a 50 year terminal sublease by respondent to applicant as at 2011 date for rent review, which did not proceed because of the proposal to carry out the public purpose of the acquisition - gross income, outgoings and capitalisation rate all in issue - whether (as applicant contends) terminal rent at 2011 rent review date should be assessed by the comparable transactions method referable to wharf access fees paid by two fast ferry operators at Manly, or (as respondent contends) on depreciated replacement cost method - if the former, appropriate adjustments - if the latter, assessment of value of land and improvements and fair rate of return - assessment of headlease rental outgoing by reference to rent review in 2015 - assessment of other outgoings - assessment of appropriate capitalisation rate - dual rate capitalisation for sinking fund. Legislation Cited: Land Acquisition (Just Terms Compensation) Act 1991 ss 54, 55(a)-(b), 55(f), 56(1)(a), 57, 59 Land and Environment Court Act 1979 s 37(1) Passenger Transport Act 1990 ss 3(1), 4(b)(i)-(ii), 4(e), 16(1), 16AB(1), 16AB(4)(a), 16AE(2), 16AE(5) Passenger Transport Regulation 2007 cl 216A Transport Administration Act 1988 ss 3C, 3D(a), 3G(1), 35B, 35C Manly Local Environmental Plan 1988 Sydney Regional Environmental Plan (Sydney Harbour Catchment) 2005 Cases Cited: Adams v Valuer General [2014] NSWLEC 1005 Alcatel Australia Ltd v Scarcella [2001] NSWSC 154, (2001) 10 BPR 18,593 AMP Capital Investors Ltd v Transport Infrastructure Development Corporation [2008] NSWCA 325, (2008) 163 LGERA 245 Bligh v Minister Administering the Environmental Planning and Assessment Act [2011] NSWLEC 220 BP Australia Pty Ltd v Roads and Traffic Authority of NSW [2006] NSWLEC 147 Bretherton v United Kingdom Totalisator Company Limited [1945] KB 555 Chircop v Transport for NSW [2014] NSWLEC 63 East End Dwellings Co Ltd v Finsbury Borough Council [1952] AC 109 F R Evans (Leeds) Ltd v English Electric Co Ltd (1978) 36 P&CR 185 Federal Commissioner of Taxation v Murry [1998] HCA 42, (1998) 193 CLR 605 Federal Commissioner of Taxation v Westgarth [1950] HCA 59, (1950) 81 CLR 396 Fisher v Deputy Commissioner of Land Tax [1915] HCA 84, (1915) 20 CLR 242 Googong Pty Ltd v The Commonwealth (1977) 13 ALR 449 Grace Bros Pty Ltd v The Commonwealth of Australia (1953) 12 The Valuer 334, 367 Graham Trilby Pty Ltd v Valuer-General [2011] NSWLEC 68 Harbinger Capital Partners v Caldwell [2013] EWCA Civ 492 Houssein v Under Secretary, Department of Industrial Relations and Technology [1982] HCA 2, (1982) 148 CLR 88 Inland Revenue Commissioners v Muller & Co's Margarine Limited [1901] AC 217 Leichhardt Municipal Council v Seatainer Terminals Pty Ltd (1981) 48 LGRA 409 Liverpool City Council v Commonwealth of Australia [1993] FCA 539 (1993) 46 FCR 67 Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305, (2001) 52 NSWLR 705 Marroun v Roads and Maritime Services [2012] NSWLEC 199 McDonald v Roads and Traffic Authority of New South Wales [2009] NSWLEC 105, (2009) 169 LGERA 352 Minister of State for Home Affairs v Rostron [1914] HCA 66, (1914) 18 CLR 634 MIR Bros Unit Constructions Pty Ltd v Roads and Traffic Authority [2006] NSWCA 314 Roads & Traffic Authority v Hurstville Council [2001] NSWCA 11, (2001) 112 LGERA 223 Roads and Traffic Authority (NSW) v Mosca [2006] NSWCA 159, (2006) 146 LGERA 335 Roads and Traffic Authority of New South Wales v Perry [2001] NSWCA 251, (2001) 52 NSWLR 222 Roads and Traffic Authority v Muir [2005] NSWCA 460, (2005) 143 LGERA 192 Robinson Brothers (Brewers) Ltd v Houghton and Chester-Le-Street Assessment Committee [1937] 2 KB 445 Royal Sydney Golf Club v Federal Commissioner of Taxation [1957] HCA 31, (1957) 97 CLR 379 Sandhurst Trustees Limited v Roads and Traffic Authority of NSW [2006] NSWLEC 243 Secretary of State for Foreign Affairs v Charlesworth Pilling & Co [1901] AC 373 Spencer v The Commonwealth [1907] HCA 82, (1907) 5 CLR 418 Symex Holdings Ltd v Commissioner of State Revenue [2007] VSC 159 The Minister v New South Wales Aerated Water and Confectionery Co Ltd [1916] HCA 48, (1916) 22 CLR 56 TMG Developments Pty Limited v Manly Council [2013] NSWLEC 1099 Valuer-General of New South Wales v In Adam Pty Limited [2012] NSWCA 20 Texts Cited: H.A. Hill et al, Butterworths, Hill and Redman's Law of Landlord and Tenant, vol 1 (at Issue 68) New South Wales, Report of the Special Commission of Inquiry into Sydney Ferries Corporation (2007) R.O. Rost and H.G. Collins, Land Valuation and Compensation in Australia (Australian Institute of Valuers and Land Economists, 3rd ed, 1984) Category: Principal judgment Parties: TMG Developments Pty Limited (Applicant) Roads and Maritime Services (Respondent) Representation: COUNSEL: A Galasso SC and L Waterson (Applicant) P Tomasetti SC and N Eastman (Respondent) SOLICITORS: King & Wood Mallesons (Applicant) Ashurst (Respondent) File Number(s): 30843/12