The case (AWF Prop Co 2 Pty Ltd and Ararat Wind Farm Pty Ltd v Ararat Rural City Council and Valuer General Victoria [2020] VSC 853) sought to clarify whether the farm's wind turbines should be classed as chattels or fixtures.

The significance of this seemingly inane distinction is because of how the Fire Services Property Levy calculated.

This levy requires property owners to pay an annual fee to their local councils to help fund fire and emergency services. The fee is calculated by a property's classification along with its capital improved value.

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If an asset is considered a fixture to a property, then it is included in the capital improved value, but if it is considered a chattel, it is not.

In March 2018, Ararat Rural City Council set the capital improved value of Ararat Wind Farm at $470,400,000.

But Ararat Wind Farm contended the capital improved value was more than thirty times lower than this, at just $14,560,000.

The dramatic difference arose from whether or not the wind turbines and other above-ground wind farm assets were included in the valuation.

The Supreme Court of Victoria ruled these assets were chattels, and therefore did not contribute to the farm's capital improved value.

This decision will lower what Ararat Wind Farm is required to pay to the levy, and may also set a precedent for other wind farms, and possibly solar farms.

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