Woolworths Appeal Dismissed
Woolworths' action against Port Macquarie-Hastings Council in the NSW Court of Appeal over prime real estate in the town's central business district, now being developed by Coles supermarket, has been dismissed.
In 2009, Council entered an agreement to sell land on the corner of Hayward and Gordon Streets in Port Macquarie to Coles, after protracted and unsuccessful negotiations with Woolworths. Council then received a development application for the construction of a new 4000 square metre Coles supermarket with speciality shops.
Woolworths proceeded to take legal action in the NSW Supreme Court against Council, claiming it had not been told that Coles had entered negotiations over the prime piece of real estate at Port Macquarie's CBD gateway. Woolworths further claimed that Council's actions were misleading and contravened the Fair Trading Act.
In July 2010, the NSW Supreme Court dismissed the claim lodged by Woolworths concluding that the company failed to establish that it suffered any loss as a result of Council's conduct and that Council was not liable in any way to Woolworths in respect of its decision to sell the car park site to Coles.
Woolworths then lodged an appeal against the decision with the NSW Court of Appeal with a decision on the matter handed down today (Thursday).
The NSW Court of Appeal unanimously upheld the original judgment of Justice Hammerschlag who made findings that, although Council had not informed Woolworths that Coles had become interested in acquiring the site, it was inherently unlikely, given how far the parties were apart in their negotiations, that Woolworths would have immediately abandoned its own position and exchanged contracts on Council's terms.
Although not necessary to make any formal finding given the dismissal of the appeal on this basis, the Court of Appeal also expressed a view that, although Woolworths was initially a successful party under an Expression of Interest to buy the land, given the amount of time that had elapsed since the initial EOI and the relationship between the parties on the terms of the sale, any possible expectation that Woolworths should have been told that its dealings with Council were no longer on an exclusive basis, must have ended before the date contracts were exchanged with Coles.
It was therefore the view of the Court of Appeal that Council did not engage in any misleading or deceptive conduct when negotiating and exchanging contracts with Coles.
Acting General Manager Jeffery Sharp said the NSW Court of Appeal decision is a fantastic outcome for Council and ends what has been a lengthy and costly legal process for all parties involved.
"We are delighted that the NSW Court of Appeal has dismissed Woolworths' appeal against the original decision handed down by the NSW Supreme Court last year," Mr Sharp said.
"We are now able to continue on with our core business whilst not having the concern of legal proceedings.
"The decision also validates Council's handling of the matter in the original negotiations with Woolworths and Coles."
Woolworths has been ordered to pay Council's costs.