Cranbourne developers in legal spat over 29cm
The project involved the creation of an 80-lot subdivision on the edge of Cranbourne's Amstel Golf Club by the Australian International Property Corporation, which would then on-sell a 1.2 hectare lot to a second developer, Nashaat Michael.
But the complicated process of consolidating and then resubdividing seven titles along Cranbourne-Frankston Road hit a snag when Dr Michael disputed the placement of a tree reserve and identified a 29-centimetre "discrepancy" between the original plan and the plan of subdivision.
The fight escalated when Dr Michael refused to remove a caveat over the property, with AIPC launching legal action in the Supreme Court.
"There was no single reason for the difference (i.e. the change did not create an advantage or disadvantage to any party or authority), rather it occurred as the plan of subdivision was 'fine tuned' through the planning process," an affidavit filed by AIPC's solicitors said.
With $5.69 million in land sales inaccessible because settlement has been frozen, AIPC is claiming the delay is costing $1150 a day in interest charges on its financing.
"There is also a risk that the purchasers may seek to withdraw from the contract, as time passes," the affidavit adds.
But solicitors for Dr Michael claim the dispute over the 29-centimetre "discrepancy" and filings for the lawsuit revealed that AIPC materially changed the size of the property he was set to receive.
"Without any prior consent of [Dr Michael] the [plan] reduces the area of the purchased land ... from 1.214 hectares to 0.9859 hectares, which represents a reduction in the area of the land by approximately 18.8 per cent," they allege. "This will significantly affect the value of the land purchased by [Dr Michael] under the contract of sale."
A bid to mediate the dispute has failed and the case will be heard in early December.
cvedelago@fairfaxmedia.com.au Twitter: @chrisvedelago
Frequently Asked Questions about this Article…
The legal dispute involves a 29-centimetre sliver of land separating two properties, which has led to a disagreement over the ownership and placement of a tree reserve. This discrepancy has resulted in a legal battle between the Australian International Property Corporation (AIPC) and Nashaat Michael.
The dispute has put the future of the multimillion-dollar residential estate at risk, freezing $5.69 million in land sales and costing AIPC $1150 a day in interest charges due to the delay in settlement.
The 29-centimetre discrepancy is significant because it has led to a reduction in the area of the land purchased by Nashaat Michael, from 1.214 hectares to 0.9859 hectares, which represents an 18.8% reduction and significantly affects the land's value.
AIPC is facing financial implications due to the delay in settlement, which is costing them $1150 a day in interest charges on their financing. Additionally, there is a risk that purchasers may withdraw from the contract as time passes.
Nashaat Michael's solicitors claim that AIPC materially changed the size of the property he was set to receive without his prior consent, reducing the land area by approximately 18.8%, which affects the land's value.
Yes, there was an attempt to mediate the dispute, but it failed. As a result, the case is scheduled to be heard in early December.
The potential risk for purchasers is that they may seek to withdraw from the contract as the dispute causes delays, which could impact their investment plans.
The court case regarding the Cranbourne land dispute is expected to be heard in early December.
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