Millions of Dollars, 11 Questions and a Court Case

CLICK HERE FOR THE SOURCE STORY

The Examiner reported on the case between Creative Property Holdings and Car Parks Super was heard on Friday, and such was the convoluted nature of the submissions the presiding Justice remarked it would be "unthinkable" for him to have made a determination before being led through the circumstances.

Well 'His Honour' was right on the money as so, so, many questions hang in the air, the answers to which are bound to impact upon Launceston's ratepayer – and potentially rather heavily.

Always remembering that Justice David O'Callaghan has extended five times since June 8, 2021 the time for the applicant (CPH) to file and serve its written submissions. The last extension was for Friday. CPH director Chris Billing did not provide an update. 

So, to the questions and only some of which have been complied here. They, and the context notes, have been compiled from various sources.

QUESTIONS

1  Looking back, and now ahead, what real 21st C need has this project been devised to serve?

• Under pressure from St John Street property owners because of significant anti-social behaviour by bus patrons at the present on-street bus interchange there and severe impacts on retailers, Council investigated alternatives. The Consultant's Report investigated a number of alternatives, initially excluding the Paterson Street Car Park area and Dechaineaux Way. 

• The preferred on-street locations outside Paterson Pilgrim Church and Creche and in the next block outside the State Public Buildings, drew criticism from the Church and State Government, due to the transfer of Anti-social behaviour. 

• Metro published its opposition to Paterson Street relocations and in doing so said "Metro believes that relocating Launceston's CBD bus interchange away from their current positions in St John Street would be detrimental to bus patrons and may hurt city businesses." 

• Undeterred, Council directed its consultants to review its report and include the privately-owned Paterson Central Carpark site with Dechaineax Way as their preferred Bus Interchange location. The owner of the car park site was not consulted, and learned of the selection and a development of a private developer's Creative Precinct to be also on its land, from the media.

2 How will ratepayers benefit from this project and at what cost to them? Indeed, is it a cost effective use of ratepayers' monies at any level?

• Metro is a Government Business Enterprise and not a local Government responsibility to fund or give financial support to. Already Council funds the under-whelming Tiger Bus Service, that fails to deliver the transit benefits trumpeted. 

• If Metro doesn't want it, then why is it happening? 

• Other cities keep busses along major roadways.

3 How does this project compare with comparable streetscapeing for like purposes elsewhere?

• That is something that is yet to be explained if there is anyone available to elucidate.

4 Why did Council purchase the defunct Birchalls and Katies shops, alleging this would transform the sadly ailing Brisbane Street Mall if used as a pedestrian way to-and-from the bus interchange?

• At a purchase cost of several millions of dollars above the then market value, why did Council seek a $10M funding grant from the Commonwealth Government's Building Better Regions Fund, a funding pool designated for drought-affected communities, to support the development of a creative precinct and bus interchange in the CBD

• Labor and the Greens accused the Commonwealth Government of blatant pork-barreling over this funding allocation, given Launceston was NOT drought affected, and communities that were, received nothing. 

• Council's invitation to Developers and prospective tenants to undertake the Birchall's project, drew NO REPORTED INTEREST, and the former rate-paying shops continue to generate NIL INCOME to Council. 

• Council has reportedly spent $M's of funding on preparation of plans and concepts and published NO RESULTS to its ratepayers.

5 Is it really necessary to acquire this land for a 'Bus Station' anyway?

• Council has not articulated a rationale for the purchase and by-and-large all discussion on the subject has been behind closed doors.

6 Who was it that developed the initial proposal to acquire the Paterson Central Carpark site, anyway? 

• Following media publicity about the project and assertions that Council had already purchased the car park, the private owner was approached by Director Christopher Billing of a company called "Ebenezer", as his proposed purchaser of the car park. 

• The private owner of the car park indicated a refusal to sell the carpark, but told Council it may consider a proposal that in return transferred some equivalent Council-owned car parks to the owner's car parking portfolio. 

• Although initially considered a possibility by Council's CEO, the proposal was turned down. 

• Mr Billing continued to chase the owner, by this stage using another of his companies, and telling the owner that if a sale to his company did not occur, that Council would move to compulsorily acquire the carpark. 

• At a meeting and communications between the Council ( Mayor, CEO) and the private owner, the prospect of compulsory acquisition was indicated. 

• For a period of more than 6 months, Mr Billing continued to chase the owner on virtually a daily basis, offering multiple proposals on price and conditions and eventuating in failed settlement terms, both with and without Council acting as the guarantor to the proposal, finally ending in legal action by Mr Billing's company in the Australian Federal Court.

7  Who is Christopher Billing, and what businesses does he operate? 

• Over a protracted period, and at the same time as floating the Creative Precinct project, Mr Billing's Foundry Company has attracted media attention against claims of non-payment of staff entitlements, alleged eviction by landlords for non-payment of rents, vacant premises and non-completion of educational contracts for students. 

• Foundry no longer appears to offer face to face educational and vocational training in Launceston, and Mr Billing has most-recently been confirmed as residing in Sydney, presumably from where he directs his businesses in an on-line format.

8  Why does the City of Launceston continue to persist with this project given that it arguably poses risks to future ratepayers as a consequence of an arguably flawed planning and business proposition? 

•  UTAS academic and transportation expert Bob Cotgrove (Urban Geographer and Transport Economist) has written extensively on this matter, and says "Planners must face cold, hard reality - (in a Launceston context) cars are irreplaceable". He is quoted as saying "The effect of restricting car parking in the CBD... would simply strangle the CBD." For "the viability of Launceston's CBD [should] encourage more to attract customers and ensure that such parking is unobtrusive and as attractive as possible." 

• Launceston's CEO, to the contrary, has said "Carparks do not attract people to visit and/or work in the city, will not generate additional employment or activation." 

• Paterson Central Carpark provides 125 car parking spaces and they are in high demand. 

• The private owner believes the carpark is an essential asset to the Brisbane St Mall traders and if it ceases, it would render severe impacts on the retailing and commercial activities of the Central Area. This view is backed up by expert evidence that Paterson Central Carpark is "the most popular carpark in Tasmania and surpasses the best in Hobart". 

• It has always been the stated intention of the owner to retain Paterson Central Carpark and as economic circumstances allow, further expand its capacity to as much as 429 parking spaces (see DA 0647/2007) previously approved for a (then) $20M Car Park and Retail Development. 

• None of the adjoining property owners have expressed support for a Bus Interchange or loss of the carpark on this site, in fact to the contrary.

9 Are the funds applied for by Launceston Council for 'Drought Relief' for the drought Launceston did not actually experienced still destined for this project?

• Council has not indicated any further advice that it has received from the Federal Government in regard to this matter and as time passes it becomes more and more unclear.

10 Why should ratepayers 'gift a development opportunity' to a speculative developer who is highly unlikely to provide an ongoing dividend via rates? Indeed, given the 'State Govt Loan Funds' can their use be truly justified in terms of the level of debt ratepayers will be required to service going forward.

• Council has not indicated to ratepayers why this should be so in the current political and fiscal environment..

11 Why does the City of Launceston continue to persist with this project given that it arguably poses risks to future ratepayers as a consequence of a now arguably flawed planning proposition?

• Council has committed itself somewhat heavily to this 'development' and by all accounts it has already expended significant monies on developing plans plus a significant sum to acquire the defunct Birchalls and Katies shops, It seems that the situation will not be any clearer until early 2022 when and if Australian Federal Court. the hands down a determination in regard to the current case before it and that surely will impact upon Council decision making ... hopefully before the 2022 Local Government Elections.

MORE AND MORE QUESTIONS FOR LAUNCESTON'S TOWN HALL

An ongoing saga about the purchase of the Launceston Myer carpark is likely to drag into 2022 following the Federal Court of Australia hearing a near-five-hour case detailing prolonged and "curious" interactions. 

The case between Creative Property Holdings and Car Parks Super was heard on Friday, and such was the convoluted nature of the submissions the presiding Justice remarked it would be "unthinkable" for him to have made a determination before being led through the circumstances. ..................... The court heard of a contract disagreement that first started in June 2020 that was still not resolved when legal proceedings commenced almost a year later, and that those legal proceedings now hinged on the objective interpretation of one "critical document". ..................... That "critical document" was an email between conveyancing lawyers for CPH and CPS on November 20 last year detailing the requirements for a contract, the third contract about the sale, was finalised. ..................... Legal representative for CPH, the group purchasing the car park, Chris Gunson SC told Justice David O'Callaghan his client was confident a contract regarding the sale had initially been entered into, and that contract had never been broken despite ongoing grievances and concerns being worked through. ..................... The court heard that contract was for the sale of 41-43 Paterson Street, the Myer car park, for $12 million with a deposit of $1.2 million set to be paid. ..................... The deposit became a point of contention through the course of the Friday hearing, with Mr Gunson telling the court it was proof of a continual contract throughout the back-and-forth between the two parties. ..................... He told the court that the deposit had then been withheld and released in "bad faith", before being released once legal proceedings had commenced "for no reason other than to bolster an assertion the deposit had never been paid". ..................... Legal representative for CPS, the group selling the car park, Shaun McElwaine SC was adamant the deposit had been forfeited to his client due to a contract breach by CPS. ..................... "Your Honour should find there was a material breach of their [Creative Property Holdings'] contract in the failure to pay the deposit [in the timeframe]," Mr McElwaine said. ..................... He said the failure came as a result of "completion [not being] achieved on a stipulated date". ..................... "That amounts to a fundamental breach, it justifies termination ... the deposit in that event is forfeited to the vendor," he said. ..................... Mr McElwaine told the court that forfeiture related to a June contract that "was never signed by the vendor", but was signed by CPS and the council. ..................... The court heard two other contracts were at least floated in October and November. ..................... The court heard the $1.2 million deposit was initially paid by the City of Launceston Council, acting as guarantor for Creative Property Holdings, but the council started to "lose its enthusiasm for settlement or its ongoing involvement" and "demanded the return of the deposit". ..................... Despite the deposit debate, the main point of contention put forward by Mr Gunson and Mr McElwaine was a dispute between whether or not a formal contract had ben maintained throughout the continued squabble. ..................... Mr Gunson told the court when legal representatives for the council sent through a contract by the close of business on November 24 through which council acted as guarantor for the car park's purchase, as detailed by the "critical document", "everything that had been sought ... had been done in the terms proposed". ..................... "We say at that point a binding contract came into existence," Mr Gunson said. Mr Gunson detailed to the court a relatively cavalier approach to contract negotiations that resulted in the November 20 email marking a finalisation of an agreement to purchase, which otherwise would have to have been subject to a "ceremonial exchange of contracts". ..................... He told the court that a formal exchange was merely "an administrative formality". ..................... Mr McElwaine detailed how language used in contract negotiations had not been cavalier, and instead had been typical of conveyancing law. ..................... He told the court without the formal exchange of specific contractual documents, there had been no contract. ..................... He told the court, as a result, the November 20 email should not have been misrepresented by CPH as constituting a legitimate exchange of contract. ..................... Justice O'Callaghan said he would preside over what he had heard through the court sitting, but that it was unlikely he would reach a decision before early next year.

The car park at the centre of a Federal Court battle was not the target of compulsory acquisition by the state government, owners were assured last year. ... The advice that "the Crown is not seeking to compulsorily acquire this property" came in correspondence to Car Park Super directors Don and Janet Allen dated November 25, 2020. ..................... The Examiner has sighted the correspondence. ..................... Car Parks Super own the Paterson Street Central car park which is the proposed site for a Creative Precinct. ..................... Creative Property Holdings, the company which proposed the precinct, is taking legal action against Car Parks Super in the Federal Court. ..................... Despite extensive ongoing negotiations between the parties since June last year, no sale was ever finalised. ..................... In recent correspondence sighted by The Examiner, CPH said: "CPH is doing all it can in an effort to rearrange its financing proposals, but as of this time has not been able to arrange its finances in such a way as to place it in a position where an unconditional offer can be put". ..................... The company said that an offer on terms more favourable than previously proposed by CPH was creating "significant difficulty". Federal Court documents reveal contracts were proposed at a price of $12 million last year. ..................... The state government has provided a $6 million interest free loan to the council for use in the proposed development and federal government funds of about $17.5 million are available. ..................... State Growth Minister Roger Jaensch said: "I understand the property remains the subject to a contract for sale and that there is currently a legal process underway between the vendor and private developer". ..................... "Any acquisition of land by the Crown is undertaken in accordance with the provisions of the Land Acquisition Act 1993." Under the act, compulsory acquisition is possible for public purposes including transport and education. ..................... When asked about compulsory acquisition, Launceston Mayor Albert van Zetten said the council was eager to see a strategic, higher order use for the site as soon as possible. ..................... "However, the acquisition of the site is currently before the federal court and we expect a resolution in the near future," he said. "Until that time it would be inappropriate to provide further comment or engage in hypotheticals." ..................... Justice David O'Callaghan has extended five times since June 8, 2021 the time for the applicant (CPH) to file and serve its written submissions. The last extension was to 4pm yesterday. CPH director Chris Billing did not provide an update.