MARSHALL WINS FAIRWAY ISLAND APPEAL

Chief Justice Paul de Jersey and Justices Hugh Fraser and Robert Gotterson set aside the orders made by Justice David Jackson in July and August last year relating to Marshall company Yolla Holding’s rights over the waterway surrounding Fairway Island.

The move appears to have stymied moves by major landowner Aion Corporation to force Yolla to hand over the waterway free of charge to the Fairway Island body corporate, known as the Hope Island Resort Primary Thoroughfare Body Corporate (HIPT).

The action was brought by Aion in order to give clarity to the rights of Fairway Island landowners to build a pontoon on their waterfront lots without seeking the consent of Yolla.

Aion Corporation has not revealed its next step in the long-running dispute, although a High Court challenge remains open to it. Aion did not respond to requests by Gold Coast Business News for comment.

HIPT not party to the original action against Yolla and could still launch its own separate action against the company.

However, the latest Supreme Court ruling has made it clear that the interests of all parties had been considered in the matter, with Justice Fraser concluding that Yolla would suffer a “value disadvantage” should it be forced to transfer the waterway to the body corporate for no fee.

Fairway Island is located within Hope Island Resort and is surrounded by a 10.39ha canal which has direct deepwater access via the Coomera River.

Aion acquired 78 of Fairway Island’s 85 lots from receivers in 2011 and has since sold a number of them.
Marshall, who previously controlled Fairway Island through No Limit 7 Pty Ltd until receivers were appointed to the company in 2010, acquired the waterway for $700,000 from former owner Mirvac the same year.

Last year, Supreme Court Justice David Jackson ruled that the lot owned by Yolla is “primary thoroughfare” which Aion said at the time was a significant step in ensuring that Fairway Island lot owners can access the waterway.

Justice Jackson found that the waterway lot was approved by the Gold Coast City Council in “contravention” of the requirements of the Integrated Resort Development Act.

Yolla argued that Mirvac was the registered proprietor when the lot was created and that the lot was not shown on the site plan as a primary thoroughfare.

Justice Fraser, in handing down his decision on the appeal, agreed that a contravention of the Act had occurred.

“The dispute came to a head in July 2012 in an exchange of solicitors’ letters,” says Justice Fraser.

“Aion asserted, and Yolla denied, that the Act obliged Yolla to transfer Lot 989 to the HIPT Body Corporate, that Yolla held its interest in that land as trustee for the HIPT Body Corporate, and that Yolla was not entitled to grant licences for mooring in the canal.”

Aion managed to win a ruling last year that the land was a primary thoroughfare and that Yolla was the registered owner, but the court did not order Yolla to transfer title of the land to the body corporate.

Justice Jackson determined that Aion was a third party and that he could not make that ruling because the body corporate was not party to that action.

Justice Fraser says the obligation to transfer the lot to the body corporate does not arise unless the lot is shown “on the plan as the primary thoroughfare”.

A court order forcing Yolla to declare its property as primary thoroughfare and, even more extremely, forcing it to transfer that property to the body corporate for no consideration, “is unlikely to reflect the legislative purpose”, he says.

“The requirement that the lot be shown on the registered plan as primary thoroughfare was not met in this case.”

The judge says he had to weigh up the interests of the body corporate and the existing landowners on Fairway Island with the interests of Yolla and the value disadvantage it would suffer should the company be forced to hand the land to the body corporate.

The judge lays the blame for the current situation on Mirvac for failing to lodge a plan showing that the land in question was primary thoroughfare, and the Gold Coast City Council for approving the plan in contravention of the act and the Registrar of Titles for registering the land.

“The loss and inconvenience which lot holders and other interested persons may have sustained as a result of the canal land not being held by the HIPT body corporate are attributable to those (assumed) contraventions rather than to any deficiency in the statutory text,” Justice Fraser says.

“Acknowledging that views might reasonably differ on upon this issue, in my respectful opinion the construction preferred by the primary judge involves an unjustified departure from the literal and natural meaning of that text and did not accord sufficient weight to the principle that “where a statute is capable of than one construction, that construction will be chosen which interferes least with private property rights”.

The justices allowed the appeal, set aside the orders made by Justice Jackson last year and ordered that the application be dismissed with costs awarded to Yolla.