PORT Stephens Council will withdraw a key document in its multi-million dollar battle with a developer over drainage at a Nelson Bay housing estate.
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The council advised Lagoons Estate developer David Vitnell on Thursday that a 2011 deed of agreement that formed a key plank of its defence would be withdrawn, in a significant concession by the council.
The Lagoons Estate drainage case, that Port Stephens councillor Geoff Dingle says has already cost the council $9 million, will now concentrate on whether the council has complied with a 2006 NSW Court of Appeal decision which gave it 18 months to complete drainage works to stop stormwater being diverted to Lagoons estate.
The council had relied on a 2011 deed of agreement between council and a previous Lagoons estate owner, where the council agreed to pay $750,000 to settle any drainage claims and the previous owner agreed not to take any further action over drainage issues.
Mr Vitnell, who launched Supreme Court action against the council in November in an attempt to force it to carry out drainage works it was ordered to undertake in 2006, said the 2011 deed was not a valid defence for the council to make because he was not involved with the 2011 agreement.
“Your client would appear to have no prospect of success,” Mr Vitnell advised the council’s solicitor on March 30, only weeks after NSW Supreme Court Justice Michael Pembroke told a preliminary hearing he was “a little troubled by the (council’s) attitude in general”.
Justice Pembroke also noted the council’s reliance on the 2011 agreement as a defence “appears difficult to maintain”.
In an email to Mr Vitnell on Thursday, council’s solicitor said the council had had an opportunity to consider its position and the 2011 deed of agreement would be withdrawn. The matter returns to court on May 16.
In March a water hydrologist found there was “very significant surface runoff volumes being diverted onto Lagoons Estate” from a nearby housing estate because of previous drainage work by the council.
The hydrologist did not believe the council had complied with the 2006 court order.