City of Charles Sturt 38. CL Report 28/01/14

RAY STREET FINDON REMEDIATION AND HOUSING PROJECT Item 6.2

APPENDIX A

Appendix A consists of 8 pages

City of Charles Sturt 4. ED Minutes 04/04/01

At 7.00 pm Councillor Sykes, Mr M Kelledy and T Clisby left the meeting.

CONFIDENTIAL ITEM — Part ll

Motion — Exclusion of the Public

That pursuant to Section 90(2) of the Local Government Act 1999, Council hereby orders that the public be excluded from attendance at this meeting with the exception of administrative staff currently in attendance and Mr S Glenn from PPK Environment & Infrastructure in order to consider the item in confidence as the matter falls within the ambit of Section 90(3)(d)... "tenders for the supply of goods or the provision of services (including the carrying out of works), or information relating to the acquisition or disposal of land".

Moved Mayor Anderson, Seconded Councillor Pinto Carried

At 7.04 pm Mr S Glenn from PPK Environment & Infrastructure joined the meeting.

9. RAY STREET DEVELOPMENT (01/04248)

Brief

To give consideration to the need to agree principles for the purposes of preparing a contract between Council and its preferred developer.

Report

At 7.07 pm Councillor Sykes returned to the meeting.

The Manager Major Projects provided background on the project and the risks of the development. Information was provided on the cost of the development to the developer and required subsidy to be paid by Council.

Negotiations are currently underway to reduce tip fees and the government levy. The dump fees are critical to the cost of this project and there is a limited opportunity as the City of Adelaide Tip is due to close in 2004 and is the last available tip in the metropolitan area. After that dumping charges for the project are likely to escalate by a further $2 million, which would be a direct "add on" to the Council subsidy.

The development has a negative Net Present Value and there are substantial risks to this project. The risks are being addressed through a Development Agreement between Council and the developer.

Motion

1. That the administration be authorised to negotiate and execute an agreement with Epic Pty Ltd for the rehabilitation and residential development of the former Ray Street dump site on the basis:

(a) A worst case cost to Council involving a development subsidy of $3.073 million.

City of Charles Sturt 5. ED Minutes 04/04/01

9. RAY STREET DEVELOPMENT

(01/04248)

(b) All savings achieved by Council though initiatives eg. reduced tip fees, reduced waste levy, provision of clean fill, additional land sales and government grants to be a direct saving to Council with an equal reduction in the subsidy.

(c) All commercial risks associated with the development be borne by Epic Pty Ltd eg. rehabilitation costs, land sale returns, civil engineering costs, finance costs etc.

2. That the Mayor and the Chief Executive be authorised to execute the relevant legal documents and apply the Council seal, with respect to the production of the above agreement and associated land transfers involving the sale of the Ray Street land as required by the agreement.

3. That pursuant to Section 91(7) of the Local Government Act 1999, the report to the Committee and associated appendices remain confidential for a period of six months. [Note: The grounds for this order are outlined in the resolution above whereby the matter was considered in confidence by the Committee under Section 90(3)].

Moved Councillor Olsen, Seconded Mayor Anderson Carried

Motion

That the public be allowed to return to this meeting.

Moved Mayor Anderson, Seconded Councillor Pinto

Carried

OTHER BUSINESS

10. INCOME GENERATING STRATEGIES

Councillor Ferrao raised the matter of Income Generating Strategies for Council and asked that the Committee commence work on these.

The matter was taken on notice and a report will be provided to the Economic Development Committee meeting on Wednesday, 2 May 2001.

City of Charles Sturt 12. ED Report 04/04/01

ITEM: 9

TO: Economic Development Committee

FROM: Manager Major Projects

DATE: 4 April 2001

SUBJECT: RAY STREET DEVELOPMENT (01/04248)

CONFIDENTIAL ITEM — Part 11

Recommendation — Exclusion of the Public

That pursuant to Section 90(2) of the Local Government Act 1999, Council hereby orders that the public be excluded from attendance at this meeting with the exception of the Chief Executive and administrative staff currently in attendance in order to consider the item in confidence as the matter falls within the ambit of Section 90(3)(d)... "tenders for the supply of goods or the provision of services (including the carrying out of works), or information relating to the acquisition or disposal of land".

Brief

To give consideration to the need to agree principles for the purposes of preparing a contract between Council and its preferred developer.

Recommendation

1. That the administration be authorised to negotiate and execute an agreement with Epic Pty Ltd for the rehabilitation and residential development of the former Ray Street dump site on the basis:

(a) A worst case cost to Council involving a development subsidy of $3.073 million.

(b) All savings resulting from reduced tip fees, reduced waste levy, provision of clean fill, additional land sales and government grants to be a direct saving to Council with an equal reduction in the subsidy.

(c) All commercial risks associated with the development be borne by Epic Pty Ltd eg. rehabilitation costs, land sale returns, civil engineering costs, finance costs etc.

2. That the Mayor and the Chief Executive be authorised to execute the relevant legal documents and apply the Council seal, with respect to the production of the above agreement and associated land transfers involving the sale of the Ray Street land as required by the agreement.

3. That pursuant to Section 91(7) of the Local Government Act 1999, the report to the Committee and associated appendices remain confidential for a period of six months.

City of Charles Sturt 13. ED Report 04/04/01

RAY STREET DEVELOPMENT Item 9

Continued

Status

This report relates to or impacts upon the following corporate goals:

• Environmental Management • Economic Development • City Rejuvenation

Relevant statutory provisions are:

• Local Government Act 1999, Section 50

Background

The Ray Street site had been a former sandpit, which had been used by the City of Woodville as a landfill during the 1960's, for purposes of disposing of its domestic waste collections. The 6-hectare site contains between 3 and 4 metres of putrescible fill with consequent problems of methane production and the risks of leachate contamination. Methane gas is undesirable being a "greenhouse gas" which attacks the ozone layer. Leachate is undesirable as it potentially impacts on ground water. Council manages the site in accordance with an Environmental Management Plan; monitoring gas and leachate to ensure there are no direct environmental and health impacts.

However, there needs to be a long-term solution to dispense with the current risks and obligations on Council. In December 1999, Council commenced a Registration of Interest procedure seeking redevelopment of the former dumpsite as a means of rehabilitating the land.

Fourteen Registrations were received. Following an exhaustive evaluation process, the April 2000 Economic Development Advisory Committee resolved as follows:

"1. That Epic 2000 be formally advised that they have been selected as the preferred partner for purposes of further developing the Ray Street rehabilitation proposal.

2. That Council agree to share the cost of pilot testing to a maximum limit of $40,000 ($80,000 maximum test costs) with Council and Epic to have equal rights to the resulting data."

Epic 2000 were proposing a full-scale environmental rehabilitation of the land in the context of a comprehensive residential infill scheme with a major public open space component. Housing was considered by Council at the time to be the best strategy when compared with the alternative options of open space/playing fields, which involved significant ongoing environmental monitoring and maintenance costs with respect to the in situ fill which would remain.

City of Charles Sturt 14. ED Report 04/04/01

RAY STREET DEVELOPMENT Item 9 Continued

The pilot testing occurred over June and July 2000 with 8 x 500 cubic metre test holes being excavated at a representative range of locations within the site. This allowed accurate analysis of the fill material to determine the ratio which can be retained on site versus waste material requiring disposal to licensed land fill. The latter is the major contributor to cost, and pilot testing enables more accurate estimates of the cost of rehabilitation.

Generally, testing revealed a more favourable circumstance than originally anticipated, with the ratio of clean fill material which can be retained on site of the order of 70%. This has also been laboratory tested for chemical contamination with positive results ie the material is classed as clean for residential purposes.

Epic 2000 have subsequently lodged itemised feasibilities for the proposed residential development and for submission to Council. These provide the basis for negotiations to determine the level of Council contribution.

The Epic figures have been audited. Separate audits were conducted on the rehabilitation/civil works figures (PPK engineers acted as auditors) and on the land realisation costs (Jones Lang Lasalle acted as auditors). The audit results are summarised as follows:

Rehabilitation/Civil Audit (PPK)

Epic's figures indicate a total cost of $12.243 million to undertake the environmental remediation and required civil works ie. roads etc.

A scheduled rates comparison for the equivalent estimated volumes indicates that the developer has allowed a 26% margin. This margin is seen as conservative given the uncertainties of recent contaminated land projects in Adelaide indicate that all have had serious cost blow outs, all being in a range of 100-133% with the exception of one which was 33%. The report generally highlights the cost sensitivity of the project with respect to dumping costs and clean fill costs.

Of particular significance is the vulnerability of the project to dumping fees. The developer has negotiated a fee of $26/tonne with the City of Adelaide Wingfield tip site. We have been able to secure a $22/tonne fee through the Western Region Waste Authority (each $1/tonne in tip fee represents an approximate $100,000 cost/saving to the project). With the closure of Garden Island, Wingfield is the only economic alternative, with Dublin and lnkerman landfills yet to be developed and Peddlers Creek adding significant transport costs. It is expected that the new landfill will be priced at around $40/tonne equal to an additional $1.8 million in cost. The consultants have pointed out that there is a limited window of opportunity with the dump license expiring at the end of 2004. Furthermore, it is considered that, at the current rate of fill, Wingfield will "ceiling" with respect to the license height limits well prior to this. This is a serious risk to the viability of the project.

City of Charles Sturt 15. ED Report 04/04/01

RAY STREET DEVELOPMENT Item 9 Continued

Land Realisation Audit (JLL)

Epic figures indicate a total land realisation of $8.5 million at today's values, which is considered a 10% under-estimate. The figure also fails to include any value growth over the 18 month development process which would add another 2-4% in price. However, the figures as submitted omit a number of costs that are in favour of Council eg. land tax, GST, financial contribution in lieu of reserve and, most significantly, the cost of capital ie interest on construction monies.

The audit also suggests 35% as a conservative and realistic margin for the developer in terms of risk and profit allowance. It also provides a complete nett reserve value (NPV) calculation indicating a NPV of negative $5.9 million when all costs are accounted for on a commercial basis. ie . the scheme is uneconomic from Epic's side or conversely , Council is getting a very good deal, albeit there's an equivalent risk of developer failure.

It is the judgement of PPK that there are a number of commercial advantages that Epic has, already being in the earth moving industry, that significantly reduces any financial risk ie, much of the equipment is already owned and they achieve commercial returns within the basic schedule rates which would not be available to a conventional developer. Additional to this, much of the risk of Council can be written out in the final development agreement/contract — eg. Council payments are post rehabilitation, bank guarantees enabling Council to pay alternative contractors to complete rehabilitation works in case of developer failure etc.

Cost to Council

The costings for the project are set out in Appendix A. Working down the table indicates a worst case cost to Council of $3.073 million based on the Western Region Waste Authorities discounted tip fee at Wingfield of $22 verses $26/tonne.

The table indicates a number of potential cost savings as follows:

• Dump disposal fees - the General Manager, Policy and Service Planning is negotiating with the City of Adelaide at present. As mentioned, a one Monne reduction equates to $100,000 saving.

• Waste levy - as members are already aware, a joint submission by Epic and Council has been lodged with the EPA seeking a waiver or part waiver of the $5/tonne waste levy (each $ reduction also equates to a $100,000 saving).

• Clean fill - the developer has charged the project for clean fill to replace the material removed from the site for disposal at $6/tonne. Council generates clean fill or is able to source it form other projects, which can create potential savings.

• Additional Land Sale - Epic has expressed interest in the potential to purchase additional land by way of the unmade carpark area north• of the European Convention Centre Carpark.

City of Charles Stud 16. ED Report 04/04/01

RAY STREET DEVELOPMENT Item 9 Continued

Government Grants - the administration is currently exploring the opportunities for grant revenue, although has not included actual estimates given the unknowns.

Depending on the ability to achieve the above savings, it maybe possible to achieve an absolute best case cost of $1.617 million. However, the likely cost will lie somewhere between the best and worst case costs and are anticipated to be of the order of $2.5 million, comparing with an equivalent initial Epic estimate of $2 million offered during the initial interview/registration of interest process.

It is noted that there are additional external costs of $462,000 for drainage works and a repository low level contaminated material currently stored in the form of surface heaps. These are costs that were external to the original project parameters that will need to be met regardless of the rehabilitation project. In fact, savings are achieved by treating the existing contaminated material as part of the Ray Street project, avoiding a high cost of disposal of the order of $600,000.

Conclusion

There is only a limited window of opportunity to achieve the rehabilitation and residential development of Ray Street equal to the remaining operating life of the Wingfield tip. After that, Council subsidy contributions would be likely to double or worse. It is therefore strategic to expedite the development agreement with Epic, although in a way that protects Council from any additional financial risk over and above the absolute worst case cost outlined above. The administration is optimistic in achieving a $ 1/2 million improvement over the worst case scenario.

Stuart Glenn from PPK will be in attendance.

City of Charles Sturt

17. ED Report 04/04/01

RAY STREET DEVELOPMENT Item 9

Appendix A

Cost of Works Itemised Cost $mill Nett Total Cost $mill Rehabilitation Cost 11.660 5% Risk .583

Total 12.243 Financial Proceeds Land Sales 8.680 Reimbursement/Preliminary Works .074 Guaranteed Savings . Disposal Dump fees ($221t versus $261t 104,000 tonnes)

.416 *(1) 3.073

Potential Savings Disposal Dump fees ($181t versus $22/t 104,000 tonnes)

.416 2.657

Waste levy (104,000 @ $5/tonne)

.520 2.137

Clean fill (Total requirement 292,000 tonnes @ $6/t) = $1.752 million • Morphettville Race Course

50,000 t @ $3/t nett • Other opportunities eg

Cheltenham Lakes

.150

.070

1.987

1.917

Additional land sale (northern carpark/European Convention Centre)

.300 *(2) 1.617

Government Environmental Grants - - External Costs Drainage *(3) .144 1.761 Repository *(4) .282 2.043

Notes

*(1) The worst case comparative nett cost to Council ($3.073 million) plus $462,000 for external costs.

*(2) The best case comparative nett cost to Council ($1.617 million) plus $462,000 for external costs.

*(3) $144,000 cost for stormwater drainage necessary to drain the European Convention Centre Carpal*. It represents a deferred infrastructure project and will be required to be undertaken irrespective of the Ray Street rehabilitation.

*(4) $282,000 cost for a repository to contain existing surface material which is classed as low grade contamination. It results from past expediency by Councils depot operations. The developers indicative costings assumed that Council would have cleared the surface contamination. However, the alternative cost of removing this material to a licensed land fill is of the order of $600,000. Accordingly, Council has previously decided on the repositioning as the most cost-effective option.

City of Charles Sturt 39. CL Report 28/01/14

RAY STREET FINDON REMEDIATION AND HOUSING PROJECT Item 6.2 APPENDIX B

City of Charles Sturt 40. CL Report 28/01/14

RAY STREET FINDON REMEDIATION AND HOUSING PROJECT Item 6.2 APPENDIX C

Appendix C consists of 14 pages.

20130207FL3A

3 June 2013

Mr Chris Shallow Development Officer (Building) City of Charles Sturt PO Box 1 Woodville SA 5011

Dear Chris,

EXCAVATION RAY STREET FINDON

As per your request I inspected the excavation at Ray Street Findon on 29 May 2013 to determine if the excavation was dangerous.

Site Observations & Discussion

The following site observations were noted during my site inspection. Photos of the excavation are attached.

The excavation has resulted due to a need to remove old filling from a previous dump site so it can be replaced with filling compacted in layers so it is suitable to support footings for new houses.

The excavation is generally well away from boundaries and hence of no concern to any adjoining properties.

However at its northern boundary it is close to houses located off Hardy Street. The excavation has two levels. The top 4m from the natural ground level is at a steep slope almost vertical and located a maximum of lm from the boundary of the properties on Hardy Street. In one location for a length of about 2m erosion has resulted in the excavation being almost in line with the boundary. There is then a 2 to 2.5m bench with another 2.5 to 3m high cut bank to the bottom level of the excavation. This second face is again almost vertical.

The cut faces although they contain filling, mainly soil, appear to be quite stable. There is very little loose material on the bench or at the base of the excavation suggesting that the amount of erosion that has occurred has been minimal except for in the location mentioned above. This location may possibly have been affected by stormwater from the adjoining properties but this has not been checked as access to the backs of the properties adjoining was not possible at the time of the inspection except for a short common area between the units on this site.

There is also no obvious erosion due to stormwater running down the cut faces.

The fence on the boundary also appears quite stable but it has been braced along parts of its length as was seen during an inspection from the common areas of the units behind.

An inspection of the one common area in the units that abuts the fence did not indicate any movement of soil down or away suggesting that the excavation was not at this stage moving or potentially likely to collapse.

TONKIN CONSULTING ABN 99 630 962 951 ACN 007 860 586

Level 2, 66 Rundle Street, Kent Town SA 5067 T +61 8 8273 3100 F +61 8 8273 3110 E adelaide@tonkin.com.au www.tonkin.com.au

Development — Envh- onmee — Local Government — Resources — Spatial —

— Water 1

a better approach

The back of the yards of the units for 2m from the fence have been bunted off by the Strata Corporation who recommend that no one uses this area.

The back of the houses would be approximately 4 to 5m from the boundary.

Finally the excavation has apparently existed as it is today for the last 4 years.

Although the excavation is very deep, steep and very close to the boundary of the units off Hardy Street it visually appears very stable and unlikely to collapse in the near future.

At present it is considered that the excavation is not dangerous and hence the serving of a Section 69 notice pursuant to the Development Act could be challenged and defeated. It would however be sensible for a Council building officer to inspect the excavation at least every month or two to note any changes to the state of the excavation. If significant change is noticed then an engineer should be asked to look at the excavation immediately.

If you have any queries regarding the above then please contact me on 8110 2220.

Yours faithfully TONKIN CONSULTING

DAVID NASH Building Surveyor/Senior Engineer

Enc

2

Excavation to northern boundary of site

Excavation to northern boundary of site, close up showing existing filling

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Barricading of rear of properties to north

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20130207FL4A

16 August 2013

Mr Chris Shallow Development Officer (Building) City of Charles Sturt PO Box 1 Woodville SA 5011

Dear Chris,

EXCAVATION RAY STREET FINDON,

As per your request I inspected the rear yards to 18 Washington Crescent Findon to determine if the cordoned off areas of the rear yards could be used again and to observe what movements if any have occurred as a result of the excavation abutting the southern boundary of the units at 18 Washington Crescent

Site Observations & Discussion

The following site observations were noted during my site inspection. Photographs are attached.

The rear yards of units 13, 12, 9, 8 and 7 were inspected plus the common area between units 13 and 12. Unit 13 is located in the south western corner of the unit site. The excavation extends from Unit 13 back to unit 7.

Unit 12 was the worst affected. The rear yard has sunk slightly near the fence with a definite slope to the paving and garden area from the rear of the unit to the fence. The pergola that extends from the back of the unit to the fence has been pulled away from the eaves of the unit. There is about a lm long section of fence that has been temporarily supported to prevent it falling into the excavation. This length of fence coincides with an area where the excavation extends right to the fence line. It is estimated that the ground level within this lm length of fence has sunk about 100mm at the boundary.

The fence to Unit 13 has a slight lean out and has dropped in the south west corner resulting in the trellis fixed to the top of the fence dropping. Paving to the rear of the unit has also dropped slightly.

The fences to units 8 and 9 have been fitted with diagonal braces to prevent the fences from falling into the excavation. Gaps under the fence at the boundary up to 100mm deep were noted where the soil has settled at the boundary. The excavation is also very close to the backs of units 8 and 9. A small garden shed was located up against the fence to unit 8. This shed appeared to quite level although it could not be inspected inside.

No concerns were noted to the rear of unit 7.

The rear of units 13 to 8 have all suffered settling of the soil close to the fence due to the closeness of the excavation. Unit 12 is the worst affected.

TONKIN CONSULTING ABN 99 630 962 951 ACN 007 860 586 Level 2, 66 Rundle Street, Kent Town SA 5067 7 +61 8 8273 3100 F +61 8 8273 3110 E adelaide@tonkin.com.au www.tonkin.com.au

Development —

— Local Government — — Spatial — Water 1

I believe that the barriers that cordon off an area approximately 2m from the rear fences of the units and to the common area could be removed from the common area and to all of the units except unit 12. Unit 12 has suffered the most settling and I am concerned that potentially the fence at least and if not part of the pergola could collapse if the excavation remains as it is for many more months or years. The braces that have been installed to the fences behind units 8 and 9 will need to stay in place.

These cordoned off areas could then be used by the tenants/owners as close to normal as possible, accepting that the fence braces must remain. The tenants/owners should however report any changes to the conditions in these rear yards to Council immediately.

Irrespective of the above very noticeable movement has occurred to the rear of units 8 to 13 resulting in leaning fences and in the case of unit 12 dropped paving and damage to the attachment of the pergola to the unit.

To ensure all the rear yards that abut the southern boundary can be used safely and to their full extent with no restrictions such as braces to the fence the excavation will either need to be filled in as intended within the next 6 to 9 months or at least the excavation closest to the fence would need to be filled in from the top down to the bottom of the excavation so that at the top there is a lm wide flat section adjacent the fence that then falls away to the bottom of the excavation at a slope no steeper than 45 ° so that it remains stable.

Although I do not believe the excavation at this stage can be considered to be dangerous allowing the serving of a Section 69 emergency order under the Development Act if it is allowed to remain as is for an extended period of time then clearly the unit occupants are not allowed the full and unrestricted use of their rear yards.

If at all possible I would recommend that Council as a minimum get the owner of the adjoining property to either finish what they started or at least fill in part of the excavation so it can no longer affect the units at 18 Washington Crescent.

If you have any queries regarding the above then please contact me on 8110 2220.

Yours faithfully TONKIN CONSULTING

DAVID NASH Building Surveyor/Senior Engineer

Enc

2

Bracing to fence to Unit 12

3

Pergola rafters being pulled away from unit fascia

4

Rear yard to unit 12 showing slope to fence

Propped fence to unit 9

5

a better approach

Slight lean to fence of unit 13

Gap under fence where soil has subsided

6

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By email: <cshallow@charlessturt.sa.gov.au > Ref: 236074\JYW02536684

6 September 2013

Mr Chris Shallow Development Officer (Building) City of Charles Sturt 72 Woodville Road WOODVILLE SA 5001

Dear Chris

Ray Street Redevelopment Project — Excavation & damage to adjacent Washington Crescent properties

We refer to your email dated 23 August 2013 and our conference with Dennis Farrow on 3 September 2013.

You have sought our advice regarding any legal options available to Council to achieve rectification of the fencing and property damage at a number of neighbouring private properties at Washington Crescent arising from excavation works undertaken at the former Ray Street Dump site.

For the purposes of this advice you have provided us with correspondence attached to your email including reports from Tonkin Consulting commissioned by the Council dated 3 June and 16 August 2013. You have also asked us to review our historical files on this property which were opened in 2000 prior to the sale of the property and then closed in 2007. Those files were re-opened in early 2009 for the purposes of providing the Council with advice regarding land contamination issues and then closed again later that year.

1. Background

In September 2001 Council entered an agreement with EPIC 2000 Pty Ltd and Petar Jurkovic ("the Developer") whereby the Developer would remediate the former domestic landfill site at Ray Street, Findon ("the Site") for the purposes of a large scale residential redevelopment project. As part of this remediation agreement ("the Agreement") Council also agreed to transfer the Site to EPIC 2000 Pty Ltd on certain terms and conditions.

We have not been provided with a full copy of the final Agreement. In particular, we do not have the documents forming Annexure 1 to the Agreement, being the Remediation Scheme, comprising the remediation work; nor the Environmental Management Plan that was to be prepared pursuant to the Agreement. The Agreement required the Developer to conduct the remediation work in accordance with the Remediation Scheme and an Environmental Management Plan which was to be designed to minimise emissions or other disturbances caused by the remediation work which were capable of disturbing nearby residents and businesses. We suspect that these

Level 15, 45 Pine Street Adelaide SA 5000 GPO Box 639 Adelaide SA 5001 1 088210 1200 F 08 8210 1234 www.normans.com.au

- 2 - 6 September 2013

potential disturbances related to issues of dust, noise, odour and vermin rather than private property damage.

The Developer has since undertaken remediation works across the Site, by way of excavating and removing contaminated soil. We understand that about 4 years ago excavation work was undertaken within close proximity of the northern boundary of the Site adjacent the neighbouring properties that front Washington Crescent ("the Neighbouring Properties"). The boundary fence adjacent some of these properties has become unstable and portion of the rear yards of a number of these properties have slightly subsided. These impacts are most recently described in the Tonkin Consulting report to you dated 16 August 2013.

Since earlier this year the owners of the Neighbouring Properties have been involved in discussions with Council regarding the rectification of their properties. The Council has written to the Developer on a number of occasions raising the issue and requesting that it be addressed. The Developer has completed the excavation works, but has been unable to complete the balance of remediation work allegedly due to access and weather issues.

We are instructed that there has been no relevant development authorisations granted in relation to the remediation of the Site.

2. Legal Options

On the information currently available to us the Council would appear to have limited legal options available to enforce rectification of the damage to the private Neighbouring Properties. The respective merits are outlined below.

2.1 Emergency order

Under Section 69(1)(a) of the Development Act 1993 ("the Act"), an authorised officer may make an emergency order because of a threat to safety arising out of an excavation. We are instructed that the subject excavation has been in existence for about 4 years.

We note that Council has recently sought independent engineering advice on two occasions which clearly states that the excavation is not dangerous. Accordingly, any order of this nature would be susceptible to a successful appeal in the ERD Court. Further, if subsequent evidence was provided to suggest the excavation had become dangerous, an emergency order would be of limited assistance to the Neighbouring Properties in achieving rectification of the damage which has already occurred to this point.

2.2 Remediation Agreement

Council can potentially enforce its contractual obligations against the Developer if it can be established that a breach of the Agreement has occurred. We have investigated the history of the Agreement and have not been provided with a signed and sealed copy, and in particular, the annexed Remediation Scheme and Environmental Management Plan. Under the Agreement we anticipate that this Annexure would provide details of the how the remediation works were to be effected.

In the absence of this Annexure we are unable to say with any accuracy as to whether the Developer has in fact breached the Agreement by causing damage to the Neighbouring Properties. As a general comment, we would not ordinarily

236074\JYW02536684

- 3 - 6 September 2013

expect that a Remediation Scheme would deal with private property damage but would rather principally deal with, amongst other things, minimisation of external impacts such as noise, dust and odour emissions.

We are instructed that an Environmental Auditor has signed off on the remediation works from an environmental management perspective, which suggests that the Developer may have achieved compliance with the Remediation Agreement.

We have seen no general provisions in the Agreement which empower Council to take action or seek remedies against the Developer with respect to any damage caused to the Neighbouring Properties.

2.3 Work that affects the stability of land

We are instructed that the excavation works are approximately 4 metres deep and are located within a metre from the boundary of the Neighbouring Properties. It is your opinion that this was work that affected the stability of land under Section 60 of the Act. Under this Section, a building owner must give notice to adjoining owners of affected land at least 28 days before the commencement of building work. A building owner who fails to comply with this provision is guilty of an offence.

The Developer was a "building owner" for the purposes of the Act as EPIC 2000 Pty Ltd was "the owner of land on or in relation to which building work is or is to be performed". We are instructed that the Developer did not give notice as required by Section 60. This potentially meant that the owners of the Neighbouring Properties were denied the opportunity to request the Developer to take appropriate precautionary work prior to the excavation being undertaken.

If notice wasn't given as required by Section 60(1)(a) of the Act, then EPIC 2000 Pty Ltd has committed an offence against Section 60(2) and is liable to be prosecuted or subject to civil enforcement. However, while the Council could potentially prosecute for failing to provide the requisite notice (and seek orders under Section 106) or take civil action under Section 85 of the Act; in this case, it is now out of time to do so. It is our understanding that the excavation has been in place for approximately 4 years. Under Section 105(5) of the Act any prosecution for an offence may be commenced at any time within 3 years after the date of the alleged commission of the offence, or at any time later within 10 years after that date with the authorisation of the Attorney General. A similar 3 year limitation applies in respect of civil enforcement proceedings (see Section 85(18) of the Act). As a consequence, the Council is out of time to commence a prosecution under Section 60 or take civil action under Section 85 and would need to seek an extension of time from the Attorney General in order to proceed. In our experience such requests can be time consuming and costly.

2.4 Civil action

It is likely that the owners of the Neighbouring Properties would have a cause of action in nuisance against the Developer claiming that their properties have been affected by the Developer's excavation works. As a consequence, these owners would be able to bring a claim for damages in the Courts to compensate them for their loss and to make good the damage.

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3. Summary

3.1 As a regulatory authority, the Council has limited opportunities to compel the Developer to rectify the damage caused to the Neighbouring Properties.

3.2 Council could potentially prosecute EPIC 2000 Pty Ltd or take civil action in relation to its breach of Section 60 of the Act. This would however rely on first obtaining an extension of time from the Attorney General to bring such action.

3.3 If it could be established that the damage to the Neighbouring Properties amounted to a breach of the Agreement then there would be the potential to consider its enforcement. While we have not been provided with the Remediation Scheme, we would be surprised if it dealt with matters of private property damage of the type under consideration here.

3.4 On the current facts an emergency order under Section 69 it is not an available option. The physical situation should continue to be monitored however, were an order to be subsequently justified, it would only be of limited utility as it would not remedy the underlying historical damage.

3.5 The Neighbouring Property owners would be entitled to take civil action themselves against the Developer to seek rectification and compensation based on a claim in nuisance. This is a private right. The Council would not have standing to bring such a civil claim on behalf of these land owners.

We trust this adequately summarises our discussions and that you will not hesitate to contact us should you wish to discuss the matter further or have us correspond with the Developer on the Council's behalf.

Yours faithfully Norman Waterhouse

Gavin J Leydon Partner Direct Line: (08) 8210 1225 or 0419 869 439 e-mail: gleydon@normans.com.au

cc Mr Dennis Farrow (by email)

236074\JYW02536684

City of Charles Sturt 41. CL Report 28/01/14

RAY STREET FINDON REMEDIATION AND HOUSING PROJECT Item 6.2 APPENDIX D

City of Charles Sturt 42. CL Report 28/01/14

RAY STREET FINDON REMEDIATION AND HOUSING PROJECT Item 6.2 APPENDIX D

Continued