Mid Coast Road Services won NSW Supreme Court action against council in December 2016 as a result of a contractual dispute following works completed on Ocean Drive, Lake Cathie in 2012.

In December 2016, the NSW Supreme Court ruled in favour of Mid Coast Road Services. 

Council lodged an appeal which was dismissed by the NSW Court of Appeal in May 2017. This appeal was on the basis that council had the right to exercise the option for future works under the contract, not the contractor. However, council has since changed the wording of its contracts to clarify that any option would be at council’s discretion not that of the contractor.

The total costs to be paid by council in relation to this case were finalised at $761,076.

“In addition to damages of $252,832 that council was required to pay Diveva in early 2017, council’s legal costs totalled $243,244 (including costs for the appeal), plus council was required to pay $265,000 for Diveva’s legal costs. The total costs for this case including damages and legal costs were $761,076,” council’s general manager Craig-Swift McNair said.

Council’s legal costs and the amount for damages were paid in the 2016-2017 financial year, with Diveva’s legal costs paid by council in August 2017, as noted in the Quarterly Budget Review Statement Council report tabled at the November 2017 council meeting.

“As previously stated, operational budgets and expenditure are reviewed on an ongoing basis and the settlement of this case (including legal costs) has been funded without impacting on any council services. This matter is now finalised,” Mr Swift-McNair said.