Supreme Court hands Labor $50m North East Link bill
The Carroll government will be forced to pay over $50 million in compensation – including the first solatium awarded to a Victorian council – after a Supreme Court battle over land seized for the North East Link.
The City of Boroondara challenged the State’s $30.1m offer for the former Boroondara Tennis Club at 1/150 Bulleen Road, Balwyn North.
The 3.7 hectare site, with 23 tennis courts, a clubhouse, café, offices and parking, was subject to a Public Use Zone
A Land Subject to Inundation Overlay also covers about 87 per cent.
Despite this, Boroondara sought $58m on the basis the property should be appraised according to its highest-and-best-use, which in its case involved a potential residential outcome.
The State argued for a valuation based on the existing planning controls.
Win-lose
On Wednesday, the court sided with council and determined how the land would have traded on the open market, taking into account a potential residential use.
But for the restrictions, it applied a 40 per cent discount to the market rate – in the end awarding $49.69m.
Another $185,000 was awarded for rent lost from a mobile phone tower.
Boroondara also received $150,000 in solatium and $161,000 in professional fees – a total of $50.19m.
North East Link costing more money, more time: AG
Ben Carroll was roads minister when the State moved to acquire the Boroondara Tennis Centre site for the North East Link in 2018. Melissa Horne replaced him in 2022 (continues below).
Jacinta Allan and later Danny Pearson held the transport infrastructure portfolio as the project moved into its construction phase, with tunnel boring started two years ago.
Originally due to be completed in the fourth quarter of 2026-27, it is now scheduled to open in the second quarter of 2028-29 – a delay of six quarters, or one and a half years, according to the Victorian Auditor-General’s Office.
The cost has also increased: the North East Link’s primary tunnels and State Tolling Corporation package had an original approved total estimated investment of $15.64b which has risen to $26.21b – 67.58pc.
The AG added the State has not formally reassessed the project’s benefit-cost ratio to reflect the changes in scope and cost.
First solatium payment
The award is understood to be the first time a Victorian council has received solatium – compensation for intangible disadvantage arising from compulsory acquisition rather than compensation for the market value of the land itself.
Boroondara argued the payment recognised the loss of a community facility that had operated on the site for decades.
The court accepted the compulsory acquisition caused council an intangible disadvantage beyond the financial value of the property.
The former tennis centre closed in 2022 to make way for the North East Link.
An 18-court replacement facility was established at Glen Waverley.
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