Costco, rising at Westgate. This was taken in January. Photo / Brett Phibbs
Costco, rising at Westgate. This was taken in January. Photo / Brett Phibbs
A town centre owner's $80 million-plus case against Auckland Council and Auckland Transport concluded in court yesterday after a lengthy trial that centred on whether services agreed on had been delivered to the multibillion-dollar hub.
Justice Gerard van Bohemen reserved his decision in the case, which ran for eight weeks.
Last year, the case was cited as being a claim for $80 million but it exceeded that in the latest proceedings.
Lawyers for businesses owned by developer Mark Gunton were in the High Court at Auckland in the case which opened on February 14.
Gunton's businesses claimed they suffered a reduction in the market value of assets of $67,439,283 and reduced rental of $13,133,279, a preliminary decision in the matter out last year said.
Westgate Town Centre, Westgate Properties, NZRPG Management, Westgate Town Centre (2017), Westgate Properties (2017) and NZRPG Management (2017) sued the two authorities, alleging failure to deliver services at the new town centre where Costco is due to open later this year.
The two authorities denied many of the claims made against them and mounted strong defences.
Bruce Gray QC appeared for the Westgate companies and Richard Lange for the two authorities.
An initial decision in the proceedings out last April from Justice Edwin Wylie said the Westgate businesses alleged that the authorities had failed to meet many contractual obligations, hence the companies were seeking damages of just over $80m.
It was quiet at Westgate last month. Photo / Sylvie Whinray
"An amended statement of claim ... does increase the damages sought from AC/AT to at least $80,572,562 with the amount continue to accrue," the judge said a year ago.
The hearing concluded at 5pm yesterday.
Justice Wylie said last year that the $80.7m was the reduced rental income NZRPG asserts it has suffered as a result of the services not being delivered.
The quantum had climbed since then. Last year's application centred on discovery.
Claims centred on:
• Plans to transform Fred Taylor Dr from a state highway into a town centre street.
• Construction of Northside Drive East including putting a bridge over State Highway 16 to connect Northside Drive East with Northside Drive West.
• To develop a town square and surrounding roads to permit free pedestrian and traffic movement.
• To develop a new bus interchange at an agreed location.
• To fund the upgrade of Maki Street South.
• To underground existing high voltage transmission lines.
• To design and build a new public library and community centre.
There were many contracts between the parties for the Westgate Town Centre development, the judge said last year.
"The statement of claim filed by NZRPG is a lengthy and complex document. In essence, the plaintiffs say that Auckland Council and Auckland Transport - in an interrelated suite of contracts that must be construed together and in context - agreed to assist in developing the type and form of the new town centre envisaged," the judge said last year.
There were 23 contracts between the parties; the first was entered into in July 2004 and the last in June 2017, he noted.
The Waitākere City Council initiated the discussions which led to the various contracts and NZRPG initially negotiated and contracted with that local authority.
Mark Gunton, of NZ Retail Property Group, wants $80 million compensation. Photo / Nick Reed
All but one of the key documents relied on by NZRPG were entered into between it and that council but that council ceased to exist as from 2010. Under the Local Government (Tamaki Makaurau Reorganisation) Act 2009, all of its rights, liabilities, contracts became the rights, liabilities and contracts of Auckland Council.
Auckland Council and Auckland Transport's defence cited the contracts but those parties denied the detail or interpretation pleaded in the statement of claim by the Westgate companies.
"The effect of AC/AT's pleading is to put NZRPG to proof of the various matters it alleges," Justice Wylie said last year.
Gray for NZRPG and Lange for AC/AT agreed that the central issue in the substantive proceedings was the proper interpretation of the various contracts entered into between the parties.
Lange accepted there were a series of interrelated contracts, with a common genesis and commercial purpose.
"He submitted, however, that this common genesis and purpose are obvious from the contracts themselves. He asserted that each contract will have to be construed by reference to its own terms and circumstances," last year's decision said.
The case also went to court in 2018 when the Westgate companies were claiming only $33m. Auckland Council brought a counterclaim against Westgate then and sought summary judgement for $11.8m, according to Justice Wylie's decision of September 21, 2018.
Westgate opposed the council's legal action. But the judge ruled in favour of the council in that matter, saying he was not persuaded that Westgate had an arguable defence to the counterclaim brought by the council.
"In my judgment, it is appropriate to grant summary judgment as sought by the council," Justice Wylie ruled then. Westgate had to pay the council $11.8m, he decided and the council was entitled to costs.
The latest case, which concluded yesterday, appears on today's High Court list.
But parties involved are now awaiting a reserved decision from Justice van Bohemen which could be some weeks away.
Campbell Barbour, NZRPG's general manager, attended the long-running hearing.
