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How a handful of wealthy Belongil residents won the right to keep their seawalls

Under the resolution to a long-running Supreme Court case, Belongil beachfront landowners will now be able to 'maintain' existing protective structures but not upgrade or replace them. Photo Chris Dobney

Under the resolution to a long-running Supreme Court case, Belongil beachfront landowners will now be able to ‘maintain’ existing protective structures but not upgrade or replace them. Photo Chris Dobney

Hans Lovejoy

It’s not the lack of detail regarding the recent court settlement between Council and a handful of Belongil landowners that should concern ratepayers, it’s that the implications and long-term effects are largely unknown.

On the other hand, perhaps the community should be grateful that a class action by some of the nation’s wealthiest could be behind us.

Last week The Echo reported that a deal had been struck between Council’s insurers (not Council’s lawyers) which will see a long-running case against Council dropped and the existing beach protection works becoming the responsibility of the landowners.

And while we were told by Council’s legal services manager Ralph James there is no financial cost to ratepayers for the settlement, the cost could be environmental owing to the continued loss of beach and lack of mitigation.

Dailan Pugh’s letter argues the result will lead to erosion ‘over the next two decades with a multitude of environmental impacts.’

Will the beach now erode completely owing to the landowners having the right to maintain the existing rock structures?

And how will this affect the recently submitted CZMP?

Council’s Ralph James declined to answer these questions and more, and while the NSW Office of Environment and Heritage (OEH) made a brief statement, the planning minister Mr Rob Stokes and his department remain mute.

That the case was brought against Council is interesting in itself; it wasn’t against the state government, who are ultimately responsible for Crown lands and any protection works undertaken. Council just manage Crown lands.

Statement of claim

Briefly the claim against Council centres around ‘historical acts, decisions and omissions relating to the works in front of the Jonson Street carpark and generally in relation to coastal matters.’

Essentially the landowners blame the Jonson Street carpark for the erosion they are experiencing, and refer to a previously Council-endorsed report from BMT WBM, who are a ‘leading-edge consultancy in mechanical, maritime, water and environmental engineering and hydraulics.’

In another case against Council, landowners claim ‘significant financial loss and diminution in value of their properties as a result of Council’s acts, decisions and omissions during the 2009 storm event.’

A Supreme Court decision in March refused to allow Council (more properly Council’s insurers who ran the action) the chance to strike out some of the landowners’  points of claim.

Instead, the court said that the claims – that Council owed a continuing duty to take steps to protect the landowers’ properties from danger caused by the Jonson Street structure – should go ahead and be heard at full trial.

After that, Council’s insurers reached the settlement and thus legal liability was never conclusively determined.

Settlement details

So – back to the settlement, which was arranged by Justice Hoeben on August 12.

Significantly, it appears Council can never remove the existing walls unless the plaintiffs/landowners agree.

If the plaintiffs want to improve their structures, they need to apply within one year. Then, once they have obtained legal approval for the repairs, they need to actually make those repairs within one year of finally gaining consent.

Presumably that means that the plaintiffs only have one shot at making permanent walls.

After that, if the walls need further repair in 20 years, the plaintiffs can apply for permission but Council haven’t promised anything.

However, if Council wants to take away the existing protection and replace it, and plaintiffs agree, they’ll allow Council onto their land to fix their walls.

So the question is – how will this precedent play out in other erosion hotspots across NSW?

So who are the landowners?

It appears most are very wealthy property developers and corporate CEOs who live in Sydney, Brisbane and Melbourne. There are a few locals, however, who call Belongil their primary residence.

Ralph Lauren 57 Pty Ltd
Brisbane-based John James led the charge, and his company James Street (www.jamesst.com.au) claims it ‘has rapidly become Brisbane’s foremost retail and lifestyle precinct.’

PJ George Investments
Brisbane-based Patrick Joseph George was named on the Courier Mail’s 2014 ‘QLD’s top 150 rich list.’  The Mail then reported the George Group is, ‘one of the country’s most dynamic property investment, development and management companies.’

Bob Watson 
Multi-millionaire online employment business Seek director Bob Watson retired in 2012, after 14 years and starting out as an initial investor. According to a 2003 press release by chocolate confectionery company Yowie, ‘Mr Watson is a successful CEO, company director and entrepreneur with over 30 years’ experience building, managing and directing private and public companies globally.’

4 The Esplanade Byron Bay Pty Ltd 
This Qld-based company’s directors include stockbroker/investment adviser Bernard Noye, Mary Cummins and Brisbane-based realtor Jonathan King.

Immer (No. 196) Pty Ltd
This company’s directors include Michael Siddle, who has been chair of Ramsay Health Care since 2014 and resides in Woolwich, Sydney. Other directors include Marjorie Lysle Brislee (Sydney), Anne Marie Therese Thornton (Wildes Meadow, Southern Highlands of NSW) and Peter John Evans (Bowral NSW).

John and Anne Vaughan 
No strangers to litigation, the Vaughans have a long history of suing Council over coastal protection issues. Fun fact: Mr Vaughan may hold the record for most cases brought against Byron Shire Council – there are ten listed on www.caselaw.nsw.gov.au.

It’s understood their property does not fall under the planned retreat policy as it was bought before 1988 and they are one of the few owner/occupiers.

Paecal Pty Ltd
Sydney resident (Collaroy) Peter Michael Davies and Matthew Davies from Minyama in QLD are listed as Paecal directors.

Stewartville Pty Limited
Geoffrey Tauber is both director and secretary and is based in Brighton, Melbourne.

John Callanan 
As a well-known local, Callanan is chairman of the philanthropic group the Northern Rivers Community Foundation. He is also managing director of Tareeda Properties.

Simon and Lisa Clowes
It appears the Cloweses are connected to the John James Trust and Patrick J George Fam Discretionary Trust.

Jurgen and Ingrid Greiner 
No information available.

Comment was provided by the following:

Jan Barham – former Byron Shire mayor and NSW MLC (Greens)
‘In relation to the media release by BSC regarding the Belongil litigation resolution there are some key issues that the community deserve to be told including what the ‘fault’ or ’negligence’ of council was in relation to the loss of property value due to ’Council’s acts, decisions and omissions during the 2009 storm event’.

The community deserve to know what the evidence is on these claims and if mistakes were made, what were they as they were unknown to  council at the time.

‘Questions arise about the litigation due to claims of property values losses and the responsibility of council for the Jonson Street protection and the supposed impacts of the works on Belongil residences. The community deserve to know if in fact the Jonson Street works are the cause of erosion impacts in front of residences or if the historical unapproved protection works are the source.  The claim that property values have been diminished is a curious point and one that should be clarified.

‘By far, the most curious factor is that BSC negotiated in relation to land and works that are not solely their responsibility.  The Jonson Street works and the beach are a shared responsibility with the state government as are all approvals that operate in the beach zone. It is also a fact that any future works, either maintenance or new works require the approval of the state.  It is a concern that council negotiating in this way may have absolved the state of it’s role in the ongoing management for the coastal zone.

‘The history of the claimed ‘ideological’ position of planned retreat needs to be clarified.
In 1986 it was a state appointed administrator, Mr Jim Waugh, who oversaw the implementation of the ‘planned retreat’ planning process after extensive investigations of coastal processes in the Byron to Hastings Point Erosion Study in 1978.

It has been stated that previous councils did not consider options for protection works but that is not correct. In 2004 the council adopted to proceed with the status quo of planned retreat for the CZMP while it investigated the potential for beach nourishment.  The Cape Byron Sand Lobe Study identified that the cost and logistics of sourcing sufficient sand for the required nourishment of the beach was not feasible and so the planning to embed planned retreat in the CZMP was continued until Council withdrew the plan after the community consultation due to advice that the plan contained inconsistencies with legislation, despite the fact that this was not clarified but the potential for the insurers to withdraw their support of council was presented.’

John Callanan, former Belongil landowner and litigant
‘My one bedroom Belongil beachfront home has been my principal place of residence since I built it in 2002. I sold it in 2015 as it was too small to meet the needs of my expanding family of seven and soon to be eight grandchildren.
‘However I pursued the legal action having regard to the interest of the larger community of Belongil that comprises ‎over 100 homes, families and businesses who could not afford to pay the high but necessary legal fees to prove once and for all that the council installed rock wall in front of the swimming pool had caused the erosion problem at Belongil.

‘The council engaged engineers [who] recognised that fact and the council have endorsed and accepted many reports to that affect. Now hopefully The Echo and the handful of extremists can let go of biased and untruthful reporting and realise how important that narrow sand dune is to the health and wellbeing of the Belongil wetlands, the Belongil community itself and most importantly it provides the town centre flood protection during storm events.’

John James – lead litigant 
‘As you know a number of Belongil residents have been pursuing legal claims in proceedings in the Supreme Court (case numbered 2010/426976) concerning the impact of the Jonson Street structure on Belongil Beach and other issues concerning the protection in place along Belongil Beach.’

‘The substantive case of the Belongil residents in those proceedings included the following allegations:-
1.   Byron Shire Council constructed an artificial headland to protect the town centre in 1964
2.   Byron Shire Council rebuilt a larger artificial headland in 1976 which extended ninety (90) metres seaward of the original beach escarpment
3.   Byron Shire Council received a litany of coastal engineering advices from as early as 1964 that the artificial headland would have a detrimental downstream erosion effect on Belongil Beach
4.   A concise summary of the various advices provided to Byron Shire Council to this effect over a period spanning more than fifty (50) years occupies almost 15 pages of the Statement of Claim filed by the Belongil residents.
5.   In the process of preparing its most recent draft CZMP, Council endorsed a number of reports (which were commissioned by the Council) which confirmed the detrimental downstream erosion effect on Belongil Beach. A BMT WBM Pty Ltd report advised Council in 2010 (our underlining):-

‘Correspondingly, the seawall at Jonson Street has affected Belongil Spit erosion as an incremental increase in addition to what would have occurred naturally in its absence, but is thus not the whole contributor to the erosion that has occurred.  This incremental effect has an unusual and unexpected longshore distribution, being of relatively modest extent (approx 20m) extending over a long section of shoreline rather than a more extensive effect over a limited distance (refer Figure 22).’

  1.   The Belongil residents’ causes of action included negligence (breach of a positive duty to protect), nuisance and removal of support (Section 177 of the Conveyancing Act) based on the impact of the Jonson Street structure.

On 2 March 2016, I forwarded you an extract from our Statement of Claim particularising the allegations contained in paragraphs 1-4 above.

Ruling in Application by Council to strike out the Statement of Claim

The anticipated Supreme Court ruling referred to in the letter from King Wood Mallesons to Council leaked by a Green Councillor to you (which initiated our communications) related to a challenge by Council’s lawyers to 48 paras of the existing pleading and 52 paras of the new pleading, or 100 paragraphs out of a total of 160 paragraphs contained in our Statement of Claim (or almost 2/3 of our Statement of Claim)\

Judgment was handed down in March in favour of the Belongil residents and Council failed to strike out even one single paragraph. Costs were awarded against Council.

It was implicit from the Judgement (and from the submissions of the two competing QC’s) that the Supreme Court of NSW accepted that the Council was capable of owing the Belongil residents a positive duty (in law) and that the Belongil residents were entitled to continue to prove the duty existed (based on the facts of the Belongil situation).

Council’s insurers/lawyers denied this duty was capable of existing as a matter of law.

Final Consent Orders

On 14 July 2016, Council received legal advices from external lawyers in confidential session. A copy of the official minute is extracted below and it is clear, on the face of that official minute, that the legal advice was unfavourable to Council.

Council resolved to settle the Supreme Court Proceedings. Our understanding is that none of the green councillors sought any rescission motion (as would normally be their practice), because the legal advice was so unequivocally unfavourable. I am assuming you will be able to confirm this with the green councillor who always leaks confidential information to you (such as the above mentioned King Wood Malleson letter).

Further to the Council resolution, the Chief Justice of the Common Law Division of the Supreme Court of NSW issued final orders on Friday which included a permanent injunction restraining the Council from taking any steps to remove the existing protective works protecting the properties owned by the Belongil residents who were plaintiffs.

The terms of the injunctions made by the Supreme Court are obviously relevant to any consideration of the draft CZMP and, in particular, protection at Belongil Beach.

As a result of the injunction which applies to approximately half the protective works at Belongil Beach, the policy of ‘planned retreat’ supported by previous administrations of Council cannot be practically implemented now or in the future for fear of contempt of a Supreme Court Order.

This has positive implications for the prospects of the current draft CZMP or any other coastal management policy which favours protection for Belongil, as the Court orders must be complied with at all times.

‘Planned Retreat’
Finally, I think it is your duty as a journalist to seeks answers to some of the questions posed in my original email to you in March 2016 because it seems unequivocal that past administrations of Council have recklessly wasted the modern day equivalent of circa $50 – $100 million on a futile three decade campaign by either failing to seek, or failing to adhere to legal advice provided to Council in favour of an illegitimate pursuit of ideology:-

  • Why have previous administrations of Council spent more than thirty years unsuccessfully trying to implement ‘planned retreat’?
  • Why, in the 28 years that have elapsed since 1988, has Council only registered Part J restrictions enabling the removal of all improvements against the titles of three (3) homes in Belongil Beach?
  • Why was the last draft CZMP containing ‘planned retreat’ and submitted to the Minister for certification withdrawn by the previous Mayor’s Council?
  •  Was the previous Mayor forced by Council’s insurers to withdraw the last draft CZMP as suggested by Councillor Tabart to the Echo in April 2015 (refer previous email)?

The last two (2) questions seem even more pertinent given the further letter from Tom Tabart published in the Echo on 20 July 2016 wherein the following was attributed to him:-

‘Five years ago a complete Coastal Zone Management Plan (based on Planned Retreat) was submitted to the then-ALP NSW government. Byron Shire councillors were then hauled into a meeting by staff with their insurance company lawyer in tow and informed that the CZMP as submitted had faults that risked negating our insurance cover in litigation then in process. Despite questions, no specific detail of the ‘faults’ was forthcoming.

The CZMP was withdrawn although the then-minister Frank Sartor and his successor in the coalition administration had no idea why – and said so. As one of the councillors I still have no idea either. The community was likewise left in the dark.’

Yes, there is a great story in this, but perhaps not the one you (or the Councillor who provided you with a copy of my original email) might have originally contemplated.

Perhaps you should contact the former Mayor at the time, Jan Barham to see if she is aware of the issues that obviously continue to vex former Councillor Tom Tabart.

NSW Office of Environment and Heritage 

Question: How will the private settlement affect the recently submitted coastal policy?
‘Byron Shire’s Coastal Zone Management Plan Byron Bay Embayment (CZMP BBE) is now with the state government for assessment, yet it was unclear whether it had the legal certainty to be accepted.

According to the NSW Office of Heritage, the planning minister asked OEH to review the plan.

Regional operations a/director Peter Christie told The Echo, ‘The minister has also requested advice on the plan from the NSW Coastal Panel. I understand the panel is proposing to visit the north coast in late August where the plan will be considered.’

‘In May 2016, the NSW Government as part of its legislative reform package announced an $83.6 million commitment towards management of the NSW coastline over the next five years. Councils will be eligible for funding for works and actions arising out of their CZMP once the plan has been certified.’

Regarding the pre-court settlement between Council’s insurers and 16 Belongil residents, Mr Christie said, ‘The capacity of the Minister to intervene in these legal matters is limited.’

Questions to Byron Shire Council staff (unanswered)

  • While we are told there is no financial cost to ratepayers for the settlement, there appears a cost will be the environmental owing to the expected loss of beach and lack of mitigation. Can Mr James explain how this settlement does not contravene the Coastal Protection Act 1979?
  • Also is there an explanation as to why the state government were not included as litigants?
  • Can the Belongil landowners mount the same case again, or does this close that door as a claim?
  • Has there been advice from the state govt on the status of the CZMP BBE now this settlement has been reached?
  • As a settlement was reached, are Council’s insurance premiums not affected?
  • Is the settlement condition on the (litigant) landowner or does it apply to the property? i.e. what are the implications of on selling properties.
  • Can we get an approximate cost to council of this defence litigation since 2010, including your own/staff time?

 

 


One response to “How a handful of wealthy Belongil residents won the right to keep their seawalls”

  1. m gardner says:

    Thanks for the summary of a remarkable and extremely convoluted case. Pre-settlement still seems to me to be a way out of arriving at any meaningful understanding of the issues, responsibilities and impacts. The saga appears to continue. I am surprised, if the quotes above are relevant, that the case seems to rely on the modelling (BMT WBM Pty Ltd report advised Council in 2010) which was considered to be a preliminary model and according to a review commissioned by Council, not one upon which decisions could be based.

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