Newcastle businessman Colin Scott joins Sydney light rail class action against state government

Hunter Street businessman Colin Scott is joining a Sydney class action fighting for light rail compensation from the state government and is urging other Newcastle traders to follow suit.

City of Sydney independent councillor and George Street cafe owner Angela Vithoulkas is co-ordinating the Sydney action and expects its legal team to file a suit in two weeks. 

She said 220 Sydney businesses had received legal documents for the case.

The group’s website says the government has “neglected its duty of care” to small businesses and residents during light rail construction in Sydney and Newcastle.

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But Ms Vithoulkas said Newcastle businesses had been slow to join the legal battle.

“I have a legal funder and a legal team, and there’s no cost to businesses,” she said.

“Newcastle have been more hard done by than anyone ... I think they feel neglected. I don’t think they think they have a chance to get anything done, that they have to suck it up and cop it, and they feel abandoned.

“All they have to do is reach out to me and I’ll do all the heavy lifting. I want to do it. They are going to have to come forward so we can organise a class action for them.”

Mr Scott, who was forced to move his flagship Frontline Hobbies store to Broadmeadow in March and reduce his 40-year-old Hunter Street shop from 1000 square metres to 300, said he would join the Sydney legal action.

“We’ve been in touch,” he said. “We haven’t signed on the dotted line. We’ve only discussed it in the last couple of days, but we said we’d be interested in coming in.”

Mr Scott sent 50 emails to affected Newcastle businesses last week urging them to join the class action but has received only three replies.

“I think they’re too depressed or can’t see the point. I don’t think it’s a case of them being not too badly affected. Anyone in Hunter Street is badly affected. 

“I’ve got to qualify that by saying we were told by the state government that they would do one block at a time, dig it up then move on to the next block. That would have made life bearable.

“There’s 12 city blocks in a row dug up.”    

The Newcastle Herald has reported on the financial woes of many inner-city businesses whose turnover has plummeted since light rail work began in Hunter Street in September.

The $2.1 billion, 12km Sydney project is running a year late and facing a $1.2 billion law suit from contractor Acciona, but premier Gladys Berejiklian and her government have said repeatedly that the Newcastle project is “on time and on budget” and will deliver a boost in foot traffic to businesses when it opens. 

“In the decade leading up to the truncation and commencement of light rail and CBD renewal, there was a lack of investor and community confidence in the heart of Newcastle,” parliamentary secretary for the Hunter Scot MacDonald said on Thursday.

“There were 150 empty shops and calls from Hunter Street businesses to rethink transport and fund urban renewal.

“The NSW Liberal government has committed to and is delivering this transformation. That is translating to renewed investor confidence with 3000 apartments worth $2 billion under way or planned. We can see the evidence with the cranes in the sky.

“The state government understands there has been disruption and impacts on businesses. But we are on target to deliver Newcastle light rail as promised.

“The alternative would have been continued weak retail and commercial conditions with poor amenity and dysfunctional transport.”

Ms Vithoulkas said a Newcastle court action likely would be separate from the Sydney suit because the building contractors were different. 

NOT HAPPY: Angela Vithoulkas, outside her cafe in George Street, wants to lead a class action on behalf of Newcastle traders. Picture: Jessica Hromas

NOT HAPPY: Angela Vithoulkas, outside her cafe in George Street, wants to lead a class action on behalf of Newcastle traders. Picture: Jessica Hromas

Hunter and Scott streets are expected to reopen to traffic in the next two months, but Ms Vithoulkas said this was irrelevant.

“The outstanding question here is why should business suffer economic devastation for the sake of an infrastructure project. No business can maintain such severe economic impact for any length of time, let alone for an unknown length of time, against a project that was a lie.

“The construction plan of this project was a lie. They said they would do it in stages ... They said they had learnt from the Sydney project. They didn’t. They ripped up the whole road.

“The Newcastle impact has been a different context to the Sydney one, but again the commonality is a state-significant infrastructure project that massively impacted local businesses to the level of many of them have closed their business, are in serious debt or have been so seriously overwhelmed by the financial impact that they don’t know what their future will be.

“And none of this will be reversed or made up when the project is finished, and that’s the biggest problem we all face. No matter what good times may come, no one is putting their hand up to reimburse for the bad. 

“Why should these businesses shoulder that burden? Why didn’t this state-significant infrastructure allow for that? They allowed for everything else. They never allow for small business. 

“We seem to be the casual, throwaway thing. That is the whole basis of the legal action, because they have nowhere to go to get reimbursed.

“All we have ever asked for is fair compensation, and all the state government has ever done is rip us off.”