Developer chases $74 million payout over bungled Manly development

Manly Council voted to award contracts for the project, which had attracted strong opposition from some councillors and the community, at a closed meeting soon before the council mergers in 2016.

The administrator of the new Northern Beaches Council – formed by the merger of Manly, Warringah and Pittwater councils – later cancelled the contract on the basis the project was financially risky.

An artist’s impression of the contentious redevelopment of the Whistler Street car park in Manly.

An artist’s impression of the contentious redevelopment of the Whistler Street car park in Manly.

Photo: Manly Council

The developer argues it was entitled to compensation because the council wrongfully terminated the contract for the project, however, the Northern Beaches Council has denied any wrongdoing.

The council alleges in court documents the development deed wasn’t valid because of the way it was handled by Manly Council and any agreement reached between the two parties was legally terminated.

It says the former council and its general manager, Mr Wong, breached local government regulations that required the mayor or at least one other councillor be present when Mr Wong executed the deed under seal.

The council argues Mr Wong didn’t have the power to enter into the contract, which it said also named the wrong entity.

Mr Wong has since moved to Strathfield Council. In July, he was reappointed as the council’s general manager for the next five years.

Court documents said the former council was aware of “widespread ratepayer concerns over the illegality of [that] meeting”, which it argued had breached local government laws, and of public opposition to the project.

It also knew four of Manly’s nine councillors opposed the redevelopment and had “complained about the processes by which it and the Manly Oval project were conceived”.

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“[Manly] Council held reasonable concerns that the development deed and the transactions contemplated by it may be unlawful, such that the development deed was void and unenforceable,” the documents said.

The developer argues the council engaged in “misleading or deceptive conduct” if it entered into the contract knowing it wasn’t properly authorised and didn’t comply with the relevant laws.

Separately, the developers are appealing a decision from Supreme Court judge Michael Ball to strike out part of the council’s defence in the case. It returns to court in September.

In February, Independent Northern Beaches councillor Vincent de Luca called for an investigation into the councils’ handling of the redevelopment.

That will likely not take place until the court case is finalised.

Built Development and Athas Holdings said earlier this year they were “disappointed that council frustrated the process and erroneously abandoned the project”.

The council’s chief executive Mark Ferguson previously said the decision to cancel the project was in the community’s best interests “based on a comprehensive review and advice from independent experts”.

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