6 Sep 2008

Court rules levy on property developer unlawful

6:39 am on 6 September 2008

A property developer has won a High Court action against Auckland City Council over hundreds of thousands of dollars in charges.

Domain Nominee Ltd applied to the council last year to change the size of its development in the suburb of Parnell.

It had already paid a financial contribution of more than $222,000 to help fund new infrastructure.

Auckland City Council charged the company an additional development contribution, taking the total cost to $559,443.

The High Court has now ruled that the second charge was invalid.

A lawyer for Domain Nominee, Sue Simons, says the council may have taken money it was not entitled to from other developers, who should now be seeking refunds.

She says the ruling in favour of her company is a warning to other councils.

The Property Council spokesperson, Daniel Newman says the ruling has nationwide implications, and other developers will be examing whether they've been overcharged.

He says there are growing concerns that councils around the country have imposed 'top-up' levies incorrectly.

The Auckland City Council is deciding whether to appeal against the High Court judgement.

Spokesperson Penny Pirit says other local bodies who follow a development contribution regime will be looking at the decision with interest, and at what action the council will take.