Auckland Council v Ranfurly Village Limited
[2024] NZHC 785
•12 April 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2021-404-1219
[2024] NZHC 785
BETWEEN AUCKLAND COUNCIL
Plaintiff
AND
RANFURLY VILLAGE LIMITED
Defendant
Hearing: 18 March 2024 Appearances:
P M S McNamara and C J Ryan for Plaintiff R E Bartlett KC and A T Grant for Defendant
Judgment:
12 April 2024
JUDGMENT OF O’GORMAN J
This judgment was delivered by me on 12 April 2024 at 3 pm pursuant to r 11.5 of the High Court Rules 2016.
Registrar/Deputy Registrar
…………………………………
Solicitors/Counsel:
Simpson Grierson, Auckland A R Galbraith KC, Auckland
Generus Living Group Ltd, Auckland R E Bartlett KC, Auckland
A T Grant, Barrister, Auckland
AUCKLAND COUNCIL v RANFURLY VILLAGE LIMITED [2024] NZHC 785 [12 April 2024]
Overview
[1] This is a claim brought by Auckland Council (Council) against Ranfurly Village Ltd (Ranfurly) seeking judgment on amounts outstanding under three invoices. It is a debt collection claim. The three invoices were issued on 20 December 2019, 3 December 2020, and 11 August 2021, for development contributions owing on building consents given for blocks B, F and E2 respectively in a retirement village in Three Kings, Auckland (the Property). Money payable as a development contribution is recoverable as a debt, pursuant to s 252 of the Local Government Act 2002 (LGA).
[2] The statutory framework for development contributions is set out in pt 8, subpt 5 of the LGA. All three invoices were issued under Council’s applicable development contributions policy (DCP) in force at the time the building consent application was made that triggered the assessment.
[3] The statutory regime for levying development contributions provides procedures for the affected person to seek a reconsideration,1 or lodge an objection.2 Ranfurly did not initiate either process for any of these three invoices. Nor has Ranfurly commenced any judicial review of Council’s decision to require development contributions at the levels invoiced. In this proceeding, Ranfurly says the development contributions are incorrect because the DCPs impose an obligation to recalculate the amount in certain circumstances. It has made a part payment based on its own recalculation. Ranfurly says nothing more is properly payable.
[4] Both parties have addressed the merits of the defendant’s arguments, and they seek a substantive determination of those issues on a final basis in this proceeding.
[5] For the reasons set out in this judgment, I find that the three invoices are payable in the sums invoiced by Council. The legislative scheme requires that development contributions are assessed in accordance with the legislative regime and relevant DCP in place at the time that the application for consent triggering the liability was made. Here, the relevant applications triggering liability for each invoice were
1 Local Government Act 2002, s 199A(1).
2 Sections 199C and 199D.
for separate building consents in respect of block B, F and E2 respectively. Even though the building consent applications related to different stages of an overall retirement village, on the facts there is no obligation on Council to recalculate retrospectively any earlier development contributions, whether under the 2015 DCP, the 2019 DCP, or viewing matters through a judicial review lens of reasonableness.
Factual background
[6] On 5 August 2008, the Ranfurly Trust/Retirement Assets Ltd was granted resource consent under the Resource Management Act 1991. For the Property, the consent authorised:
(a)a retirement village with 162 apartments and an aged care facility spread across six blocks; and
(b)modifications to the Ranfurly Veterans’ Home and use of part of that building for office activity as an ancillary activity to the retirement village.
[7] Development contributions on the resource consent application were not assessed at the time the resource consent was granted. In August 2011, Ranfurly wrote to Council seeking to “finalise the net development contributions for the project”. Council’s response on 1 November 2011 gave an indicative estimate of the development contributions required, based on Council’s draft 2012 DCP. The estimated total was $1,378,742.40 (excluding GST). Council stated that “both the assessment factors and the per-HUE3 charges may be different in the adopted 2012 policy, or in other later policies that this development might be subject to”. The letter concluded with noting that it was an estimate only and that a formal assessment would be undertaken in connection with any formal consent application.
3 HUE stands for “household unit equivalence”, explained at [30] below.
[8] Subsequently, in respect of each of the three blocks at issue in this proceeding (B, F and E2), Ranfurly applied to Council for a building consent under the Building Act 2004 to build a new apartment building. Council then issued a development contributions assessment summary to Ranfurly, no review was sought or objection raised, and Council proceeded with issuing an invoice once the consent for each building was issued. The relevant dates for each different block are set out in the table below:
Block B Block F Block E2 Date of application 12 October 2015 22 November 2016 30 October 2018 Policy applied 2015 DCP 2015 DCP
Variation A
2015 DCP
Variation A
Number of apartments 73 32 34 Date of development
contributions assessment
6 January 2016 19 May 2017 6 December 2019 Invoice date 20 December 2019 3 December 2020 11 August 2021 Invoice amount (GST inclusive) $259,589.99 $250,817.94 $279,911.10
[9] On or around 18 May 2022, Ranfurly paid Council a sum of $174,536 in respect of the above three invoices. It claimed that this was the full amount owing for all development contributions assessed for the buildings on blocks B, F and E2 at the Property. It has also paid a sum of $324,553 by way of other development contributions for the Property. Ranfurly contends that the total sum of $499,089 is all that should be payable for development contributions, applying the HUE coefficients set out in the 2019 DCP as the “current and most informed development contribution policy”.
Legislative scheme
[10] Council’s claim for payment of development contribution invoices arises out of the exercise of its power conferred by pt 8, subpt 5 of the LGA to collect development contributions for capital expenditures in accordance with its DCPs.
[11] The purpose of, and principles relevant to, development contributions are set out in ss 197AA and 197AB of the LGA:
197AA Purpose of development contributions
The purpose of the development contributions provisions in this Act is to enable territorial authorities to recover from those persons undertaking development a fair, equitable, and proportionate portion of the total cost of capital expenditure necessary to service growth over the long term.
197AB Development contributions principles
(1) All persons exercising duties and functions under this subpart must take into account the following principles when preparing a development contributions policy under section 106 or requiring development contributions under section 198:
(a)development contributions should only be required if the effects or cumulative effects of developments will create or have created a requirement for the territorial authority to provide or to have provided new or additional assets or assets of increased capacity:
(b)development contributions should be determined in a manner that is generally consistent with the capacity life of the assets for which they are intended to be used and in a way that avoids over-recovery of costs allocated to development contribution funding:
(c)cost allocations used to establish development contributions should be determined according to, and be proportional to, the persons who will benefit from the assets to be provided (including the community as a whole) as well as those who create the need for those assets:
(d)development contributions must be used—
(i)for or towards the purpose of the activity or the group of activities for which the contributions were required; and
(ii)for the benefit of the district or the part of the district that is identified in the development contributions policy in which the development contributions were required:
(e)territorial authorities should make sufficient information available to demonstrate what development contributions are being used for and why they are being used:
(f)development contributions should be predictable and be consistent with the methodology and schedules of the territorial authority’s development contributions policy under sections 106, 201, and 202:
(g)when calculating and requiring development contributions, territorial authorities may group together certain developments by geographic area or categories of land use, provided that—
(i)the grouping is done in a manner that balances practical and administrative efficiencies with considerations of fairness and equity; and
(ii)grouping by geographic area avoids grouping across an entire district wherever practical.
(2) In subsection (1)(a), assets includes eligible infrastructure that has been, or is intended to be, transferred by a responsible SPV to a responsible infrastructure authority under section 90 of the Infrastructure Funding and Financing Act 2020.
[12] Section 197AB(f) refers to development contributions being predictable and consistent with:
(a)the “methodology”, which is defined in s 197 as the methodology for calculating development contributions set out in sch 13 of the LGA (referred to below at [21]); and
(b)the schedules of the territorial authority’s DCP under ss 106, 201 and
202. Sections 106 and 201 prescribe the content of a DCP. A DCP must be reviewed at least once every three years using a consultation process.4 Section 201(2) requires that the DCP contains a schedule that complies with s 202. Section 201A has some additional schedule requirements if a territorial authority has determined to seek funding for community facilities. Section 202 requires that the schedule complies with the “methodology”, and it must specify the event that will give rise to a development contribution, whether upon granting a resource consent, or a building consent, or an authorisation for a service connection.
[13] Territorial authorities may require such contributions under the LGA only in relation to a “development”, which is defined by s 197 to mean:
(a) any subdivision, building (as defined in section 8 of the Building Act 2004), land use, or work that generates a demand for reserves, network infrastructure, or community infrastructure; but
(b) does not include the pipes or lines of a network utility operator
4 Local Government Act, s 106(6).
[14]Section 198(1) sets out when a development contribution may be required:
(1)A territorial authority may require a development contribution to be made to the territorial authority when—
(a) a resource consent is granted under the Resource Management Act 1991 for a development within its district:
(b) a building consent is granted under the Building Act 2004 for building work situated in its district (whether by the territorial authority or a building consent authority):
(c) an authorisation for a service connection is granted.
[15] Under s 198(2), a territorial authority may only require the development contribution as provided for in a policy adopted under s 102(1) that is consistent with s 201. In terms of the timing and policy relevant for determining the amount, s 198(2A) provides:
For the purposes of subsection (2), a development contribution must be consistent with the content of the policy adopted under section 102(1) that was in force at the time that the application for a resource consent, building consent, or service connection was submitted, accompanied by all required information.
[16] Section 199 provides the basis on which development contributions may be required:
(1)Development contributions may be required in relation to developments if the effect of the developments is to require new or additional assets or assets of increased capacity and, as a consequence, the territorial authority incurs capital expenditure to provide appropriately for—
(a) reserves:
(b) network infrastructure:
(c) community infrastructure.
(2)This section does not prevent a territorial authority from requiring a development contribution that is to be used to pay, in full or in part, for capital expenditure already incurred by the territorial authority in anticipation of development.
(3)In subsection (1), effect includes the cumulative effects that a development may have in combination with other developments.
[17] Section 199A(1) provides for requests for reconsideration of development contributions on prescribed grounds:
If a person is required by a territorial authority to make a development contribution under section 198, the person may request the territorial authority to reconsider the requirement if the person has grounds to believe that—
(a) the development contribution was incorrectly calculated or assessed under the territorial authority’s development contributions policy; or
(b) the territorial authority incorrectly applied its development contributions policy; or
(c) the information used to assess the person’s development against the development contributions policy, or the way the territorial authority has recorded or used it when requiring a development contribution, was incomplete or contained errors.
[18]Section 199C provides for objections on the grounds set out in s 199D:
An objection under section 199C may be made only on the ground that a territorial authority has—
(a) failed to properly take into account features of the objector’s development that, on their own or cumulatively with those of other developments, would substantially reduce the impact of the development on requirements for community facilities in the territorial authority’s district or parts of that district; or
(b) required a development contribution for community facilities not required by, or related to, the objector’s development, whether on its own or cumulatively with other developments; or
(c) required a development contribution in breach of section 200; or
(d) incorrectly applied its development contributions policy to the objector’s development.
[19]It is outside the scope of a right of objection to challenge the content of a DCP.5
[20]Section 203(2) provides for maximum development contributions:
Development contributions for network infrastructure or community infrastructure must not exceed the amount calculated by multiplying the cost of the relevant unit of demand calculated under clause 1 of Schedule 13 by the number of units of demand assessed for a development or type of development, as provided for in clause 2 of
5 Local Government Act, s 199C(3).
Schedule 13, and as amended for any Producers Price Index adjustment adopted in a development contributions policy in accordance with section 106(2B).
[21]Schedule 13 provides:
Methodology for calculating development contributions
1 Methodology for relating cost of community facilities to units of demand
(1) In order to calculate the maximum development contribution in respect of a community facility or an activity or group of activities for which a separate development contribution is to be required, a territorial authority must first—
(a)identify the total cost of the capital expenditure that the local authority expects to incur in respect of the community facility, or activity or group of activities, to meet increased demand resulting from growth within the district, or part of the district, as the case may be; and
(b)identify the share of that expenditure attributable to each unit of demand, using the units of demand for the community facility or for separate activities or groups of activities, as the case may be, by which the impact of growth has been assessed.
(2) A territorial authority may identify capital expenditure for the purposes of calculating development contributions in respect of assets or groups of assets that will be built after the period covered by the long-term plan and that are identified in the development contributions policy.
(3) The total cost of capital identified in subclause (1) may in part relate to assets intended to be delivered beyond the period covered by a territorial authority’s long-term plan if—
(a)the assets concerned are identified in the development contributions policy; and
(b)the total cost of capital expenditure does not exceed that which relates to the period over which development has been assessed for the purpose of setting development contributions.
2 Attribution of units of demand to developments
For the purpose of determining in accordance with section 203(2) the maximum development contribution that may be required for a particular development or type of development, a territorial authority must demonstrate in its methodology that it has attributed units of demand to particular developments or types of development on a consistent and equitable basis.
[22] Sections 209 and 210 impose an obligation on the territorial authority to refund or return a development contribution paid if the development does not proceed, or if a development contribution is required for a specified reserve purpose but the money is not applied for that purpose within 10 years.
Policies
[23] Council’s first DCP issued in compliance with the LGA was created in 2012. Since that time, the following policies have been issued:
(a)the 2015 DCP (together with variations A and B);
(b)the 2019 DCP; and
(c)the 2022 DCP (together with variation A).
2015 DCP
[24]The following describes the key features of the 2015 DCP.6
[25] The overview and purpose section describes the purpose of the development contributions as being “to recover from those persons undertaking development a fair, equitable, and proportionate portion of the total cost of capital expenditure necessary to service growth over the long term”.
[26]The purpose of the 2015 DCP is to:
·provide predictability and certainty to stakeholders in how infrastructure for growth, including major transformational infrastructure, is to be funded and provide transparency of what is to be funded and what has been delivered
·provide for those involved in development to make fair payments to the council to reflect the expected demand their developments will have on council infrastructure and the expected benefits residents and businesses occupying these developments will derive from council infrastructure
6 Variation A to the 2015 DCP amended sch 8, but those differences are not material in this proceeding.
·set contribution charges at levels that help achieve the scale, type, quality and location of development that the Auckland Plan vision aspires to.
[27] The 2015 DCP explains that the contribution charges are derived by dividing the capital expenditure for growth in the Long Term Plan 2015–2025 by the estimated number of new residential and non-residential developments. The capital expenditure projects funded by the contributions are set out in schs 4 and 8 of the 2015 DCP.
[28] The definitions of the 2015 DCP include “development”, cross-referencing to the definition in s 197 of the LGA and defined as including an application for certificate of acceptance (see s 199(4A) of the LGA). The term “retirement village” is defined as having the meaning in s 6 of the Retirement Villages Act 2003. “Retirement unit” in turn is defined as any dwelling unit in a retirement village (other than an aged care room).
[29] Part 3 is entitled “Transition between policies”. It states that the 2015 DCP applies to applications lodged on or after 1 July 2015. It also states, “Development contribution per unit of demand prices as per Schedule 3 will apply to applications based on applicable lodgement dates”.
[30] Central to how the territorial authority exercises its power to assess contributions is the concept of “household unit equivalence” (HUE). In accordance with sch 13 methodology requirements, the HUE creates a common denominator as a measure or unit of demand, with 1 being the estimated demand of an average sized single detached dwelling (household unit). Schedule 2 of the 2015 DCP has a table that sets out the units of demand expected from different types and sizes of development. Extracts from sch 2 of the 2015 DCP are set out below illustrating this:
Development type Development type activities Units of demand … … … Retirement unit Transport Stormwater
All others
0.3 HUE per unit
1.0 HUE per 292m2 [impervious surface area]
0.5 HUE per unit
Aged care room Community infrastructure Transport
Stormwater
All others
0.4 HUE per room
0.2 HUE per room
1.0 HUE per 292m2 [impervious surface area]
0.0 HUE per room
Small ancillary dwelling unit Stormwater All others 0.2 HUE per unit
0.6 HUE per unit
Accommodation units Stormwater
Reserves acquisition and development Transport
All others
1.0 HUE per 292m2 [impervious surface area]
0.45 HUE per unit
0.45 HUE per unit
0.0 HUE per unit… … …
[31] Paragraphs 28 and 29 of the 2015 DCP describe how Council attributed the units of demand to particular developments or types of development on a consistent and equitable basis. Council states that it considered:
(a)the need to separate residential and non-residential activities because of the different demands they place on activities of Council;
(b)the range of residential development types and scales;
(c)the range of non-residential development types and scales;
(d)the future vision for Auckland set out in the Auckland Plan including the creation of a more compact city to make better and more efficient use of infrastructure;
(e)the need for the contributions policy to align with Auckland Plan outcomes;
(f)the complexity of trying to make the policy account for every different development type; and
(g)the availability of data to support differential unit of demand factors for various types of development.
[32] Paragraph 29 of the 2015 DCP explains that use of broad averages for a limited number of development types was considered sufficient to approximate the range of development likely to occur in Auckland and that there was data currently available to identify some average demand factors for a limited number of residential development types and non-residential development types. Council considered it important to use common, standard frameworks for the classification of non-residential developments.
[33] Part 6 of the policy addresses when Council calculates development contributions. The 2015 DCP provides as follows:
35.The council will calculate contributions on a development’s first application for consent or connection authorisation and re-calculate a development for contributions on any subsequent application after the first in relation to the same development.
36.If the council does not exercise the opportunity to calculate development contributions on an application for consent or authorisation, it may calculate development contributions on a subsequent application for the same development project.
[34] Paragraph 65 of the 2015 DCP provides that invoices become due for payment immediately upon issue (they are issued in accordance with Attachment A which sets out that an invoice for a building consent is issued at the time of granting the building consent).
[35] Paragraph 66 provides that, where invoices remain unpaid beyond the payment terms set out in the DCP, Council will invoke normal debt collection practices to recover outstanding debt. Attachment A also describes certain additional enforcement options available to Council, including withholding a code compliance certificate in relation to a building consent.
2019 DCP
[36] For present purposes, there are only a few relevant differences between the 2015 DCP and the 2019 DCP.
[37] Part 3 is entitled “Transition between policies”. It states that the 2019 DCP applies to applications lodged on or after 1 January 2019. It also states, “Development contribution per unit of demand prices (as per Schedule 3) will apply to applications based on applicable lodgement dates”. Paragraph 16 says “A development that has multiple applications that cross over different policies will be subject to the policy operative at the time each separate consent was lodged.”
[38] The 2015 DCP definition of “retirement village” was replaced with the following definition:
A managed comprehensive residential development used to provide accommodation for aged people:
Includes:
· the use or development of any site(s) containing two or more units that provides accommodation, together with any services or facilities, predominantly for persons in their retirement, which may also include their spouses or partners; and
· recreation, leisure, supported residential care, welfare and medical facilities (inclusive of hospital care) and other non-residential activities accessory to the retirement village.
· Kaumātua Housing Excludes:
· Single dwellings
The retirement village must be registered under section 10 of the Retirement Villages Act 2003.
[39]The HUE coefficient in sch 2 for “retirement unit”, “All others” changed from
0.5 (as set out in the extract at [30] above) to 0.1.7 This is set out in the extract from sch 2 of the 2019 DCP below:
Development type Development type activities Units of demand … … … Retirement unit Stormwater
Transport All others
1.0 HUE per 292m2 [impervious surface area]
0.3 HUE per unit
0.1 HUE per unit
… … …
[40] The above change to the HUE coefficient was a reduction of 80 per cent. This change followed (and by inference was influenced by) an objection decision of the Development Contributions Commissioners dated 10 August 2018, discussed in the next section.
[41] Part 6 of the policy addresses when Council assesses development contributions. The 2019 DCP provides as follows:
40.The council will endeavour to assess the contributions on a development’s first application for consent or connection authorisation, it may re-calculate a development for contributions on any subsequent application in relation to the same development.
41.If the council does not assess development contributions on an earlier application for consent or authorisation, it may assess development contributions on a subsequent application for the same development project.
Ryman Healthcare Ltd objection
[42] As noted, an August 2018 decision of the Development Contributions Commissioners is relevant to the changes made in the 2019 DCP and is relied upon by the defendant.8 On 14 July 2016, Ryman Healthcare Ltd (Ryman) gave notice of its objection in respect of development contributions assessed for a land use consent to
7 Of the extracts above at [30], “aged care room”, “community infrastructure” also changed from
0.4HUE per room to 0.1 HUE per room. However, this change is not relied upon.
8 Ryman Healthcare Ltd v Auckland Council Development Contributions Commissioners at Auckland, 10 August 2018.
construct, operate, and maintain the Possum Bourne Retirement Village (the Village) in Pukekohe.9 That objection was made on the grounds that Council:
(a)failed to properly take into account characteristics of a “comprehensive care retirement village” and its occupants that, on their own or cumulatively with those of other developments, would substantially reduce the impacts of the development on requirements for infrastructure and community facilities in Council’s district or parts of that district (s 199D(a) LGA); and/or
(b)had required development contributions for infrastructure and community facilities not required by, or related to, a comprehensive care retirement village, whether on its own or cumulatively with other developments (s 199D(b) LGA);
(c)had required a development contribution in breach of s 200 of the LGA (s 199D(c) LGA); and
(d)had incorrectly applied its DCP to the development (s 199D(d) LGA).
[43] The Development Contributions Commissioners conducted a hearing of that objection on 21, 22 and 23 May 2018. Ryman produced evidence that the Village had a number of unique features that meant it created a substantially reduced demand for community facilities compared to the DCP demand assumptions. This evidence included research surveys about the demand of Village residents.
[44] On 10 August 2018, the Development Contributions Commissioners issued their decision. The Commissioners accepted that the first two grounds had been established, namely under ss 199D(a) and 199D(b). They found that the objection did not go beyond its proper scope, because it did not challenge the DCP itself. The crux of the issues between the parties was a factually based consideration concerning whether this particular Village should be an exception, rather than whether the DCP demand assumptions were appropriate more broadly. The result was a decision to
9 This was an objection under the Local Government Act, s 199C.
reduce total development contributions for the Village from the assessed amount of
$2,363,133 to a revised amount of $606,808 (a reduction of 74 per cent).
[45] After that decision was issued, the 2019 DCP came into effect (on 1 January 2019) and Council commissioned further research about the use that Aucklanders make of parks and community infrastructure facilities. That research was to gather subset data on retirement and student groups. However, the gathering of data for that research was interrupted by COVID-19 restrictions. Funding for recommencing that research has only recently been approved, so that research is yet to be completed.
Procedural background
[46] This proceeding was commenced on 17 June 2021. The claim was initially for the first two invoices. An amended claim was subsequently filed to include the third invoice issued in August 2021. Once the defence to the amended claim was filed, the parties agreed tailored discovery, specifying the categories of documents to be provided by the plaintiff. No discovery was sought from or provided by the defendant.
[47] In a joint memorandum dated 29 March 2023, the parties agreed that the proceedings were similar in nature to judicial review proceedings (given the collateral challenge to the plaintiff’s assessment of contributions). Accordingly, the parties sought orders by consent that evidence be given by way of affidavit under r 9.55 of the High Court Rules 2016. They recorded that once the affidavit evidence had been exchanged, the parties would be able to serve notices requiring production of a deponent for cross-examination “if necessary”.
[48] On 30 March 2023, Associate Judge Brittain made the consent orders as requested and set a comprehensive timetable to ready the case for hearing, including the exchange of evidence by affidavit (with provision for the parties to issues notices requiring cross-examination). The parties proceeded in accordance with that timetable, without any further case management conferences.
Defendant’s pleadings and submissions
[49] The statement of defence denies liability to pay the amounts outstanding under the three invoices on three grounds. Ranfurly alleges:
(a)Council is obliged to recalculate contributions in accordance with its obligations in the 2012 DCP and the 2015 DCP. It says Council has committed in those DCPs to calculate contributions on a development’s first application for consent or connection authorisation, and to recalculate a development for contributions on any subsequent application for the same development project. Ranfurly relies on para 35 of the 2015 DCP in this respect.
(b)Council has failed to undertake an assessment of the development taking into account various sections of the LGA.10
(c)Council has failed or refused to assess the development as a retirement village providing a full range of quality and accessible social and recreational facilities of a kind appropriate to the needs of the elderly. Accordingly, Council has not sufficiently put its mind to or made adequate allowance for the consequential lack of demand for Council facilities.
[50] The written submissions for Ranfurly say it does not owe the development contribution amounts claimed by Council “because the Council has yet to carry out a reassessment of Ranfurly’s total contributions from development of the Site required by the Council’s own development contribution policies”.11 This is the first of the three pleaded defences. The other two pleaded defences set out in [49] were not addressed in Ranfurly’s written submissions.
10 Local Government Act, ss 101(3)(a)(ii), 101(3)(a)(iv), 197AA, 197AB(1)(b), 197AB(1)(c), and sch 13.
11 Relying on para 81 of the 2012 DCP; and para 31 of the 2015 DCP – Variation A.
[51]In oral submissions, Ranfurly advanced three arguments:
(a)Council is obliged to make a reassessment of the development contributions, given its commitment to do so in para 35 of the 2015 DCP;
(b)alternatively, Council is obliged to make a reassessment of the development contributions, given its commitment to do so under para 40 of the 2019 DCP (“may” means must, given the fairness issues involved); or
(c)alternatively, the invoices are unlawful because they are at a level that no reasonable council could set in compliance with its statutory obligations (i.e., Wednesbury unreasonableness, taking into account the decision by the Development Contributions Commissioners in Ryman Healthcare Ltd v Auckland Council).
[52] Both para 35 of the 2015 SCP and para 40 of the 2019 DCP refer to the council calculating contributions on a “first application for consent” and recalculating on any subsequent application in relation to the “same development”.12 Ranfurly argues that the “first application for consent” was the 2008 resource consent, even if development contributions were not levied for that. Ranfurly alternatively argues that a reassessment obligation should be triggered by any subsequent and separate consent application in relation to the “same development”, being the wider staged development of the Property. In this case, Ranfurly contends that its subsequent building consent application for block E1 (different from the three blocks at issue), at a time when the 2019 DCP was in force, required a full recalculation by Council of contributions due for earlier blocks in the staged development.
[53]In support of those arguments, the defendant submits the following:
(a)The policy makes clear reference to different consent applications within the “same development project”. Therefore, the policy
12 See [33] and [41] above.
contemplates several individual developments within the same “project”, but also an overall “development” that features several consents.
(b)Such an interpretation fits squarely with the purposes of the DCPs and the LGA because it would enable territorial authorities to collect from developers only a “fair, equitable and proportionate portion of the total cost of capital expenditure necessary to service growth over the long term”.13 This would also prevent over-recovery.
(c)Where the metrics of demand become more refined or the asset requirements change through the life of a staged development, it is not commensurate with those variables to assess contributions for each stage in isolation, without reference to the changing conditions or the impact of the development as a whole.
(d)Reassessment by reference to updated research (like that from the Ryman Healthcare decision) or refined methodology ensures that fair and proportionate contributions are required, and over-recovery is better avoided.
[54] The defendant argues that the 80 per cent decrease in the HUE coefficient for retirement villages “all others” as now contained in the 2019 DCP reflects Council’s greater understanding of actual demand generated by retirement villages, consistent with the evidence adduced in the Ryman Healthcare objection for the Pukekohe retirement village. Ranfurly says this suggests that the earlier HUE of 0.5 was unfair, too high, and over-recovered actual costs in relation to retirement village developments that were completed prior to introduction of the 2019 DCP. While Ranfurly accepts that any alleged unlawfulness of the 2015 DCP more broadly is not for determination in this proceeding, it argues that it would nevertheless be patently unfair (and unreasonable in a Wednesbury sense) not to apply the newer HUE coefficient in the 2019 DCP for the Property, because a final assessment or recalculation should be done on completion of “the development”.
13 Local Government Act, s 197AA.
Collateral attack and relative invalidity
[55] As referred to above, the issues in this proceeding have not been raised within a review or objection process, nor have they been raised in the context of a judicial review claim. Rather, they are argued by way of defence to an action enforcing payment of the invoices as debts. Invalidity arguments of this type are sometimes called “collateral challenges”, raising administrative law issues of invalidity.14 In particular, the issue is usually whether payment must be made of an invoice issued under a statutory power, pending illegality arguments being determined in a separate proceeding for judicial review (or some other statutory process for challenge).
[56] In Air New Zealand Ltd v Wellington International Airport Ltd,15 Wellington International Airport Ltd (WIAL) had set landing charges payable by airlines for using its facilities. These were set and invoiced under s 4A of the Airport Authorities Act 1966. Air New Zealand Ltd challenged the lawfulness of those charges and issued judicial review proceedings. It meanwhile refused to pay stepped up charges and continued to pay charges at the previous level. In the High Court, WIAL sought summary judgment and contended that payment was required in accordance with the doctrine of “relative invalidity” (allegedly unlawful decisions must be treated as valid until successfully challenged). The proper course, if interim relief from payment was sought, was to apply for interim relief under s 8 of the Judicature Amendment Act 1972.16 Wild J would have agreed but decided that the Court of Appeal’s decision of Waipa District Council v Electricity Corporation of New Zealand precluded him from awarding summary judgment because it would create a res judicata, preventing judicial review relief.17 On appeal, the Court of Appeal unanimously expressed the view18 that a charging decision by a statutory body should be treated as being lawful until declared unlawful, so if an entity wants to be relieved of the obligation to pay until the judicial review challenge is determined, then
14 See Brady v Northland Regional Council [2008] NZAR 505 (HC) at [45], referencing (among others) M Taggart “Rival Theories of Invalidity in Administrative Law” in Judicial Review of Administrative Action in the 1980s (1986).
15 Air New Zealand Ltd v Wellington International Airport Ltd [2009] NZCA 259, [2009] 3 NZLR 713.
16 This is now contained in s 15 of the Judicial Review Procedure Act 2016.
17 Air New Zealand Ltd v Wellington International Airport Ltd [2008] 3 NZLR 87 (HC) at [62]–[63] and [66], referencing Waipa District Council v Electricity Corporation of New Zealand [1992] 3 NZLR 298 (CA).
18 Dicta only, because WIAL was successful in the substantive appeals heard concurrently.
it should apply for interim relief under the relevant statutory provision. If it fails to do so, then it is at risk of having summary judgment entered against it should the statutory body seek to enforce its charges.19 To the extent it was inconsistent, Waipa District Council would likely not be followed in the future. These dicta in Air New Zealand Ltd v Wellington International Airport Ltd have since been applied in other High Court judgments.20
[57] In this context, the issues are not being determined within a summary judgment application. Rather, the issues are being determined in a proceeding seeking a final judgment on the invoices as debt obligations. Since commencement of this proceeding in June 2021, the defendant has not commenced judicial review proceedings and evidently it has no intention to do so. Rather, both parties seek a determination of the merits in the context of the present proceeding. As held in Waipa District Council, a decision of that type will give rise to res judicata issues, because it is not interim in nature:21
It is difficult to see how, in the face of such a judgment, the respondent could maintain review proceedings to attack the validity of the rate on which the judgment was based.
[58] In the present context, the defendant bears the evidential burden of establishing the alleged invalidity on the balance of probabilities.22
Judicial review principles
[59] Although the disputed issues are pleaded as defences to a debt collection claim, they are akin to judicial review grounds of challenge.
[60] When exercising its statutory right to impose development contributions, Council must act lawfully, within the scope of the powers specifically conferred.23
19 Air New Zealand Ltd v Wellington International Airport Ltd, above n 15, at [86] and [106].
20 Environmental Protection Authority v Chatham Rock Phosphate Ltd [2016] NZHC 2079 at [77]; and Sunde v Sunde [2018] NZHC 2788 at [45] and [54].
21 Waipa District Council v Electricity Corporation of New Zealand, above n 17, at 302.
22 Grueber v New Zealand Transport Agency (No 2) [2014] NZHC 2924, [2015] NZAR 54 at [33].
23 Buller Electricity Ltd v Electricity Authority [2024] NZHC 706 at [128], referencing Unison Networks Ltd v Commerce Commission [2007] NZSC 74, [2008] 1 NZLR 42.
The question of what an enactment means is a question of law for the courts.24 However, statutes often leave a margin of appreciation within which a decision maker could apply the correct test any number of ways:25
It involves a question of law only when the law requires that a certain answer be given because the facts permit only one answer. Where a decision either way is fairly open, depending on the view taken, it is treated as a decision of fact, able to be impugned only if in the process of determination the decision maker misdirects itself in law.
[61] Development contribution policy decisions, like ratings decisions, are complex and often not amenable to right or wrong answers. Rather, such decisions require the resolution of factual issues and the weighing of competing interests and competing policy considerations.26
[62] So long as it is made lawfully (within the proper scope of the statutory powers), policy is for the public authority alone and is not ordinarily open to judicial review.27 In terms of precedent effect, subject to legitimate expectation issues (discussed next), a public authority is only required to bear in mind its previous policy or other representation, giving it the weight it thinks right, but no more, before deciding whether to change course.28 It follows that a change in policy does not indicate an earlier and different decision on policy was wrong, or that a new policy should apply retrospectively. In fact it is more common for a party to argue that the retrospective application of a new policy would be unfair, unreasonable, and in breach of natural justice.29 In other words, a legitimate expectation might be engendered by express or
24 Wool Board Disestablishment Co Ltd v Saxmere Co Ltd [2010] NZCA 513, [2011] 2 NZLR 442 at [116] (leave to appeal to the Supreme Court was declined in Saxmere Company Ltd v Wool Board Disestablishment Co Ltd [2011] NZSC 12); and Buller Electricity Ltd v Electricity Authority, above n 23, at [124] and [131], referencing Manawa Energy Ltd v Electricity Authority [2022] NZHC 1444 at [65]. To the extent the issue turns on interpretation as a matter of law, a standard of correctness applies: Powerco and Vector v Commerce Commission HC Wellington CIV 2005-485-1066 and 1220, 24 December 2007 at [366] per Wild J.
25 Bryson v Three Foot Six Ltd [2005] 3 NZLR 721 (SC) at [21].
26 Auckland Council v C P Group Ltd [2023] NZSC 53, [2023] 1 NZLR 35 at [96]; and AGPAC Ltd v Hamilton City Council [2021] NZHC 2222, [2022] NZRMA 1 at [118].
27 R v North and East Devon Health Authority, ex parte Coughlan [2001] QB 213 at [82], quoted in New Zealand Association for Migration and Investments Inc v Attorney-General [2006] NZAR 45 at [149].
28 Air New Zealand Ltd v Wellington International Airport Ltd [2009] NZAR 138 (HC) at [60]–[61], referencing R v North and East Devon Health Authority, above n 27, at [57]. Not appealed on these issues: Air New Zealand Ltd v Wellington International Airport Ltd, above n 15, at [19].
29 See New Zealand Association for Migration and Investments Inc v Attorney-General, above n 27, at [14].
implied promises that a decision maker will act in a certain way or by the adoption of a settled practice or policy which the claimant can reasonably expect to continue, subject to a decision maker having a “satisfactory reason” not to do so.30 In Everton Heights Ltd v Hamilton City Council, a developer succeeded in establishing a legitimate expectation that Hamilton City Council would apply its 2016/2017 policy, rather than the subsequent 2018/2019 policy, when levying development contributions for a subdivision.31
[63] The concept of legitimate expectation may be viewed as an aspect of the administrative law principle that requires governments and public authorities to act fairly and reasonably.32 The Court of Appeal in Wellington City Council v Woolworths New Zealand Ltd (No 2) summarised that administrative law test in this way:33
… judicial review of the exercise of local authority power, in essence, is a question of statutory interpretation. The local authority must act within the powers conferred on it by Parliament and its rate fixing decisions are amenable to review on the familiar Wednesbury grounds. Rating authorities must observe the purposes and criteria specified in the legislation. So they must call their attention to matters they are bound by the statute to consider and they must exclude considerations which on the same test are extraneous. They act outside the scope of the power if their decision is made for a purpose not contemplated by the legislation. And discretion is not absolute or unfettered. It is to be exercised to promote the policy and objectives of the statute. Even though the decision maker has seemingly considered all relevant factors and closed its mind to the irrelevant, if the outcome of the exercise of discretion is irrational or such that no reasonable body of persons could have arrived at the decision, the only proper inference is that the power itself has been misused.
Evidential issues
[64] The normal practice in judicial review proceedings is for evidence to be given by affidavit, rather than orally. Cross-examination of deponents is not permitted as of right. The underlying rationale for this is that judicial review applications will seldom turn on factual determinations. The relevant tribunal or authority’s findings of fact, as
30 Comptroller of Customs v Terminals (NZ) Ltd [2012] NZCA 598, [2014] 2 NZLR 137 at [121]−[127]; and Splice Fruit Ltd v New Zealand Kiwifruit Board [2016] NZHC 864, [2016] NZAR 680 at [92] and [102].
31 Everton Heights Ltd v Hamilton City Council [2023] NZHC 40, [2023] NZRMA 238. Its third cause of action on this ground did not ultimately succeed because it could not disprove satisfactory reasons for the council to frustrate those expectations in the broader public interest: see [238]−[239].
32 Comptroller of Customs v Terminals (NZ) Ltd, above n 30, at [121].
33 Wellington City Council v Woolworths New Zealand Ltd (No 2) [1996] 2 NZLR 537 (CA) at 545, approved in Auckland Council v C P Group Ltd, above n 26, at [89]–[98].
distinguished from the legal consequences of those facts, are generally not open to review by a court in the exercise of its supervisory powers.34 Only if it is necessary will cross-examination be granted.35 To so qualify, the subject matter must be relevant. Documents or opinions not before the relevant decision maker at the time are usually irrelevant.36 There are, in addition, the problems inherent in the assessments or views of one member of a multi-member body being held out as representative of the views of all the members.37
[65] Given the timetable orders made by consent and prior notice of their intention to do so, the parties proceeded on the basis that they were entitled to cross-examine the affidavit witnesses. I allowed that to occur for the plaintiff’s witnesses, but this only served to demonstrate why cross-examination is not usually permitted in judicial review proceedings. The defendant’s arguments in this proceeding depend on the interpretation of legislative provisions and Council’s written DCPs (both are matters for legal submission rather than witness evidence), as well as alleged inferences of unfairness comparing changes in the DCPs following the Ryman Healthcare objection decision. Individual employees within Council have only limited roles and authority, and are not the decision makers who set the DCPs. Even then, written decisions are usually not permitted to be supplemented with witness commentary by the decision makers themselves.38 I disallowed further oral evidence to be led from the defendant’s affidavit witness (not a decision maker) because I regarded his intended supplementary opinions on legality/unreasonableness as irrelevant (they were instead matters for legal submission) and the grounds for allowing supplementary evidence were not made out.
34 Deliu v New Zealand Law Society (Subpoena) [2013] NZHC 2597, [2014] NZAR 112 at [8]; and Geary v Psychologists’ Board [2009] NZCA 134, [2009] NZAR 338 at [12], referencing O’Reilly v Mackman [1983] 2 AC 237 at 282.
35 Geary v Psychologists’ Board, above n 34, at [23], leave to appeal declined in Geary v Psychologists’ Board [2009] NZSC 67, (2009) 19 PRNZ 415.
36 BNZ Investments Limited v CIR (2007) 23 NZTC 21,078 at [29]–[30]; Roussel Uclaf Australia Pty Ltd v Pharmaceutical Management Agency Ltd [1997] 1 NZLR 650 (CA) at 658; New Era Energy Inc v Electricity Commission HC Wellington CIV-2007-485-002774, 9 May 2008 at [12]; and Kaikōura and Hurunui Landowners Association Inc v Minister of Fisheries [2022] NZHC 2677 at [93].
37 Geary v Psychologists’ Board, above n 34, at [26].
38 See Secretary for Internal Affairs v Pub Charity [2013] NZCA 627, [2014] NZAR 177 at [27]−[28], including the comment that the decision “should speak for itself”.
[66] Before cross-examination of the plaintiff’s witnesses commenced, counsel for the defendant sought an order excluding other witnesses. In civil proceedings, the court has a discretion to exclude witnesses if to allow them to remain may undermine the trial process whereby one witness may gain an advantage in seeing or hearing a prior witness undergo cross-examination. If the witnesses are already committed to a particular position (in prior exchanges of evidence), then the necessity of an exclusion order is diminished because they will clearly face challenge to the truthfulness or reliability of their evidence if they move to accommodate other evidence given in their presence or to meet lines of cross-examination evident from the evidence of previous witnesses.39 However, issues such as deceit, misrepresentation and concealment may justify a witness exclusion order.40 I declined to make such orders in this case, because the evidence was already committed in affidavit form, and this is not a proceeding in which credibility or reliability is a concern.
Analysis
[67] The central issues in this case concern the meaning of “development” within the statutory provisions, and as it appears in the reassessment provision of each DCP. The former issue was considered by the Court of Appeal in Beaumont Trading Co Ltd v Auckland Council.41 In that case, the Court of Appeal held that the word “development” is used as “a term of art”.42 In particular, it means the subdivision or other development that generates a demand for infrastructure.43 The use of the word “for” in s 198(1) also suggests that there must be a direct relationship with the particular consent or authorisation that has triggered the requirement for contributions.44
[68] A similar conclusion was reached in Neil Construction Ltd v North Shore City Council.45 As found in that case, a DCP and the processes it provides for must comply strictly with the relevant provisions of the LGA, which are the sole source of a
39 Robinson Crothall Ltd v Snap On Inc (2002) 16 PRNZ 430 (HC), referenced in Reynolds v Calvert
[2014] NZHC 1975, [2015] 2 NZLR 61 at [13].
40 Maruha Corporation v Amaltal Corporation (2004) 17 PRNZ 67 (HC) at [14].
41 Beaumont Trading Co Ltd v Auckland Council [2016] NZCA 223, [2016] NZRMA 359.
42 At [30].
43 At [33].
44 At [28].
45 Neil Construction Ltd v North Shore City Council [2008] NZRMA 275 (HC).
council’s power to exact development contributions.46 To qualify as a development under s 197, a subdivision or other development must generate a demand for infrastructure.47 The granting of a consent is not the trigger for the charging of a development contribution except in the temporal sense authorised by s 198(1). The statutory triggers for requiring a development contribution are that a given project:48
(a)is a “development” (s 197);
(b)which either alone or in combination with another “development” will have the effect of requiring expenditure on infrastructure (s 199); and
(c)is provided for in the DCP (s 198(2)).
[69] In AGPAC Ltd v Hamilton City Council, Gault J applied the above cases in respect of 17 different challenges to various policies of the Hamilton City Council and decisions made pursuant to those policies for imposing development contributions. The Judge recognised that such policies may legitimately use modelled demand rather than actual demand,49 and a council may lawfully adopt a policy that is practicably workable and also predictable, exercising judgement as to what is consistent and equitable when providing for various types of developments.
[70] Applying the above cases and considering the legislative scheme, I find that it is entirely within the scope of the statutory provisions of the LGA to apply the methodology set out in the DCP in force at the time the particular consent application triggering the assessment was made. In particular:
(a)this is expressly required by s 198(2A);50
(b)this is consistent with the requirement under s 197AB(1)(f) that development contributions should be predictable and consistent with the methodology and schedules of the DCP, emphasising the
46 At [48].
47 At [109].
48 At [116].
49 AGPAC Ltd v Hamilton City Council, above n 26, at [118].
50 See [15] above.
importance of having certainty that the existing policy at the time of application will determine the liability amount even if the consent is not issued until a later point in time when a new DCP might be in effect; and
(c)s 106(6) requires the DCP to be reviewed at least once every three years using a consultation process, reinforcing that changes should not be imposed that are inconsistent with those procedural expectations.
[71] In this instance, the defendant would happen to benefit from a retrospective change in policy, but a finding that Council must apply new policies to change invoiced development charges retrospectively would undermine predictability and would harm developers with the spectre of higher potential charges. Nothing in the legislative scheme requires that approach. To the contrary, the statutory provisions are consistent with a legitimate expectation that the policies will not be changed retrospectively, and the development contribution charges will not be revisited except as expressly provided for in the DCP applicable at the time.51
[72] The next issue is whether the policies in force at the time provided for a retrospective recalculation of the type sought in this proceeding. Consistent with s 198(2A), the transitional provisions in each DCP expressly apply to applications lodged on or after the date that the DCP takes effect.52 As required under the statutory framework, the policies themselves refer to the importance of predictability and certainty.53
[73] In the 2015 DCP, the only potential exception is para 35, which enables a recalculation in relation to the “same development”, which I find cross-refers back to the sense the word “development” is used earlier in the sentence. That is, the development on which Council has already calculated contributions following the first application for consent. Therefore, I reject Ranfurly’s argument that the relevant “first application for consent” was the 2008 resource consent application. Council did not
51 See Everton Heights Ltd v Hamilton City Council, above n 31.
52 See [29] and [37] above.
53 See [26] above.
calculate contributions for the resource consent,54 but instead did so for each of the building consents. On the facts of this case, in respect of blocks B, F and E2, it was that particular type of consent application that triggered the requirement of contributions. A building falls within the definition of “development” in s 197, and there is no dispute that an application for a building consent satisfies the other requirements that trigger liability for a development contribution, as discussed in Neil Construction Ltd.55
[74] I accept the submissions for Council that the reassessment provision in the DCPs enables a recalculation if the first application is superseded in respect of the same subject matter (for example, if a building that is the subject matter of a consent application changes in size or nature). It does not contemplate a mismatch of different consent applications concerning different subject matter (albeit in the same overall project). The “development” that is the subject of each of the building consent applications for blocks B, F and E2 is separate from the “development” that is the subject of the building consent application for block E1. While the definition of development is sufficiently wide to incorporate the entire project in some factual circumstances, in this instance it was the application for separate building consents that triggered the liability for development contributions, and it is only the “same development” that can be revisited under para 35 of the 2015 DCP if superseded by any subsequent application about the same subject matter. For these reasons, the building consent application in 2019 for block E1 is not relevant under para 35 of the 2015 DCP for the development contribution assessments triggered by the building consent applications for blocks B, F and E2.
[75] In any event, the building consent application for block E1 was subject to the 2019 DCP, so the next issue is whether a retrospective recalculation was required under para 40 of that policy.56 That paragraph also uses the words “the same development”. For the reasons set out above, I do not accept that para 40 enables a
54 As reflected in para 36 of the 2015 DCP, Council has a discretion whether to assess development contributions at the time the application is made for the resource consent, or on subsequent consent applications for the same development. In Everton Heights Ltd v Hamilton City Council, above n 27, at [124] the Court recognised this discretion under s 198 but found that the particular wording of the policy, considered along with the correspondence, did not maintain that full discretion.
55 See [68] above.
56 See [41] above.
retrospective recalculation of the subject matter of entirely separate building consent applications. The transitional provisions in pt 3 are clear that the 2019 DCP is intended to apply to applications lodged on or after 1 January 2019, with no evident intent for retrospective effect. Ranfurly’s interpretation would be contrary to s 198(2A) of the LGA and the other statutory provisions referred to above emphasising the importance of predictability and certainty.
[76] Furthermore, para 40 of the 2019 DCP (above at [41]) uses the word “may” rather than “will”. It is a matter of interpretation whether “may” means “must”, but there is a presumption that permissive or facultative expressions operate according to their ordinary natural meaning.57 I accept that the ordinary permissive meaning applies in this case, consistent with the statutory context and the broader wording of the 2019 DCP. Among other things, this appears to be a deliberate change from the word “will” used in para 35 of the 2015 DCP, and a permissive meaning enables Council to weigh the significance of any changes compared with the original consent application, along with the objectives of predictability and certainty in the context of the mandatory wording of s 198(2A) and considerations of procedural fairness and legitimate expectations. As discussed above, matters of discretion are not amenable to judicial review except on Wednesbury grounds.
[77] Addressing that alternative argument, I do not accept that the three invoices or either of the DCPs are invalid on the grounds of Wednesbury unreasonableness. The statutory regime expressly contemplates grouping categories of developments, done in a manner that balances practical and administrative efficiencies with considerations of fairness and equity. The DCPs set out how Council made such decisions when setting the policy.58 This includes reference to the complexity of trying to make the policy properly account for every different development type, and the availability of data sufficient to support differential unit of demand factors. Such policy judgements, using modelled demand rather than actual demand, are assessments not amenable to right or wrong answers.59
57 Far North District Council v Local Government Commission [1994] 3 NZLR 78 (HC) at 84, referencing Ward v Williams (1955) 92 CLR 496 at 505.
58 See [31] above.
59 See [60] and [61] above.
[78] Ranfurly sought to argue (contrary to Council’s position) that a residential development cannot qualify as a “retirement village” under the 2019 DCP unless it includes recreation, leisure, supported residential care, welfare and medical facilities (inclusive of hospital care) and other non-residential activities accessible to the retirement village, all of which Ranfurly says justify a reduced need for community infrastructure that is reflected in the significantly lower HUE coefficient. Given the word “includes”, as a matter of interpretation I do not agree that these features are a necessary component of the definition of “retirement village” in the 2019 DCP. For example, I expect there might be many residential developments that would properly qualify as retirement villages but would not include hospital facilities. Therefore, I do not see the change in the definition of “retirement village” as being particularly significant for the matters at issue in this proceeding.
[79]Of much greater significance is the change in the HUE coefficient from 0.5 to
0.1 for the “all others” category. Even assuming the defendant is correct that the more recent HUE measure provides a more accurate proxy for the expected demand from retirement units, this does not mean that the 2015 DCP was wrong as a matter of law or principle based on the information available at that time.
[80] A change in policy does not substantiate that any prior policy was wrong as a matter of law, or that a new policy should apply retrospectively.60 It may well be that the more recent figure was based on changing expectations of demand following consideration of the evidence in the Ryman Healthcare objection process. However, caution is necessary given that the Ryman Healthcare evidence was directed at the unique features of that particular full-service village rather than whether the DCP retirement unit demand assumptions were appropriate more broadly. The research work to assess the broader question is yet to be done. In those circumstances, there is no evidential basis for regarding the policy decisions made in 2015 as wrong or irrational based on the information available to those decision makers at the time.
[81] The defendant’s arguments about substantive unfairness and the desirability of preventing over-recovery61 do not give sufficient weight to the uncertainty and
60 See [62] above.
61 See [53](b)–(d) and [54] above.
unfairness that can arise from imposing higher charges retrospectively, nor do they recognise the limits of assessing such factual issues in a judicial review context.62 Other than issues of DCP interpretation, there is no suggestion of any representation that could form the basis of a legitimate expectation on the defendant’s part. Furthermore, this Court cannot determine that a new policy should be applied retrospectively when this would be contrary to s 198(2A) of the LGA.
[82] The defendant has not sought to substantiate its pleaded allegation that Council has wrongly failed or refused to assess each development as a retirement village providing a full range of quality and accessible social and recreational facilities, triggering a need to make an allowance for a consequential lack of demand for community facilities. Under the DCPs, all “retirement units” are subject to the application of the HUE units of demand set out in sch 2 of the relevant DCP. Using modelled demand is expressly permitted in the legislative scheme, even though actual demand will be higher or lower in individual cases.63 As already explained, my interpretation is that the definition of “retirement village” includes both “full service” retirement villages and also those with fewer facilities. That is a matter of policy. There is no evidence to substantiate that any different or separate grouping must be adopted as a matter of irrationality or unreasonableness (in a judicial review sense).
[83] Nor has the defendant adduced any evidence about actual demand for community facilities arising from blocks B, F and E2. These are arguments that may be pursued in an objection provided for under s 199C, but the possibility of making individual exceptions based on evidence does not undermine the legitimacy of the broader policy, nor does it require Council to disregard its statutory obligation to apply the relevant DCP in force at the time (absent that evidence).
[84] For completeness, I accept the plaintiff’s submissions that ss 101(3), 197AA, 197AB and sch 13 impact how DCPs are set, but are not otherwise relevant to the assessment of individual contributions payable under a lawful DCP.64 The defendant
62 See Bryson v Three Foot Six Ltd, above n 25, at [21], [26] and [27]; Hu v Immigration and Protection Tribunal [2017] NZHC 41, [2017] NZAR 508 at [30]–[31]; and Everton Heights Ltd v Hamilton City Council, above n 31, at [158]–[181] discussing that relief for substantive unfairness per se is rarely, if ever, granted.
63 AGPAC Ltd v Hamilton City Council, above n 26, at [118].
64 At [29].
accepts that this debt collection proceeding is not a suitable vehicle for determining whether the policy is unlawful more broadly. In any event, for the reasons set out above I am not satisfied that these sections provide any basis for contending that the DCPs are unlawful or have been misapplied.
Result
[85] I find that the three invoices issued by the plaintiff on 20 December 2019, 3 December 2020 and 11 August 2021 for development contributions are payable in full and each is recoverable as a debt, pursuant to s 252 of the LGA.
[86] I award judgment on the amounts outstanding under those invoices, plus interest to be calculated under s 10 of the Interest on Money Claims Act 2016 from the date when each invoice was due for payment until the date of payment, taking into account the part payment received. The amended statement of claim did not make those calculations correctly, so at the same time as addressing costs (see below), I ask the parties to set out their calculations for the correct judgment amount (as at the date of this judgment) that reflects this result.
[87] The plaintiff is entitled to costs. If the parties cannot agree, I direct the plaintiff’s memorandum on costs to be filed and served within 10 working days of this judgment, and the defendant’s to be filed and served 10 working days later.
O’Gorman J
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