Land compensation bid ‘doomed to fail’ - judge
A Christchurch property owner’s claim for more compensation for his Crown-acquired land is likely doomed to fail, a court has ruled.
In July 2014, the Government compulsorily acquired a car yard owned by Ace Developments. The Moorhouse Ave land was earmarked to be part of the metro sports facility in the city blueprint.
Nicky Wagner, then Associate Minister for Canterbury Earthquake Recovery, determined the Government would pay Ace market value for the property. A panel of three experts created by Minister for Canterbury Earthquake Recovery Gerry Brownlee advised a $3.3 million payout.
Ace claimed compensation should be based on the costs of relocating its business, $7.4m, and filed a case in the High Court. The firm said it needed to buy two sites, demolish the existing buildings, construct new buildings and create a car yard. It also claimed the new property’s investment value would be $820,000 less than the previous site, which it assessed to be worth $3.4m.
In 2016, Justice David Gendall declined Ace’s application to bring new evidence and an appeal of this decision was declined this week. The company wanted to call expert evidence supporting its proposal.
The appeal decision said some of the reasons for Gendall’s decision meant Ace’s High Court case was ‘‘doomed to fail’’. In its report to Brownlee and Wagner, the expert panel advised there was no legal basis to the claim for relocation costs.
The Court of Appeal interpreted the panel’s reasons: ‘‘It did not accept Ace’s characterisation of its business as owning and leasing specialist car yards. Rather it considered Ace a landowner and investor earning an income not from carrying on a business on the land, but from renting the premises,’’ it said. ’’A reasonable business person using their own money would not pay $6.549m to obtain an asset that would be worth only $2.58m.’’
In the High Court decision, Gendall said Ace deliberately chose not to call the evidence at an earlier stage and litigants were obliged to put their best case forward at the first instance. He also said the new evidence was ‘‘not material’’ because business replication costs were not allowed under the Canterbury Earthquake Recovery Act.