Cost of Failing to Mediate First
The City Council removed the airport manager from the airport for alleged problems associated with safety, noise and maintenance. The government agency reportedly demanded $1.68 million AUD, including the repair costs for the aerodrome.
The agreement with the airport manager, Aviation and Leisure Corporation (ALC), had a provision to mediate disputes before pursuing litigation. However, the City Council first took the case to the courts without mediating the dispute.
Recently, the New South Wales Supreme Court ordered the City Council to pay costs associated with the litigation to ALC for a little over $50,000 AUD. The government agency itself has spent around $200,000 AUD so far.
That Court ruled the decision to pursue litigation before mediation “in breach of the agreement.” Moreover, “the parties should be held to their bargain.”
The two sides signed an aerodrome management agreement in August 2007. The owner of ALC, Peter Roberts, claims he tried to discuss the issues with the City Council and was concerned about the costs to the community.
The efforts to mediate will continue until late September.
forward to a friend