Developer to pay $12m
The Auckland Council has won a $12 million claim in the first round of a complex legal battle with the developer of the Westgate town-centre project in northwest Auckland.
The High Court in Auckland has ordered New Zealand Retail Property Group (NZRPG) to pay, despite its wider claims blaming the council for the new town centre being ‘‘dysfunctional’’.
The council said the money was owed for the undergrounding of high-tension power lines, which would otherwise have hung over the still-expanding development next to the northwestern motorway at Massey.
Justice Wylie rejected NZRPG’s argument that the council’s claim should be considered along with disputes relating to some of 22 other contracts with the council, signed over a 13-year period.
The judge said the only grounds to hold off enforcing payment would be if ‘‘a substantial miscarriage of justice would be likely’’.
‘‘There is no evidence to suggest [NZRPG] faces potential liquidation or would be unable to meet judgement,’ Justice Wylie’s decision said.
The council had sought summary judgment of the debt while more complex claims from the developer totalling $33m are resolved.
In the wider dispute, NZRPG argues the council and its agency Auckland Transport had failed to deliver the original concept for a town centre, where the NorthWest Shopping Centre, owned by Stride Property, now sits in the second stage of the development.
The developer said an upgrade to roads in the ‘‘old’’ Westgate centre meant it was suffering from customers being drawn to the newer centre, which is located on the opposite side of Fred Taylor Drive.
NZRPG noted a bus interchange had not been developed, the town square was difficult to navigate, and Fred Taylor Drive hindered traffic moving between the two parts of the centre.
In its claim filed earlier this year, NZRPG said it faced a loss of $1m in potential rental income and its properties were worth $32m less than if the development had proceeded in line with its view of the agreements with the council.
In his decision, Justice Wylie said NZRPG had argued ‘‘the new Westgate town centre is not the compact, integrated subregional town centre contracted for and that it is fundamentally dysfunctional’’.
No date has been set for the wider dispute, which is due before the High Court.