Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel
[2018] NZHC 926
•3 May 2018
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2016-404-002333 CIV-2016-404-002335
[2018] NZHC 926
UNDER The Judicature Amendment Act 1972 and the Local Government (Auckland Transitional Provisions) Act 2010 and the Resource Management Act 1991 IN THE MATTER OF
Section 159 Local Government (Auckland Transitional Provisions) Act 2010
AND IN THE MATTER OF
an appeal under s 158 of the Local Government (Auckland Transitional Provisions) Act 2010
BETWEEN
FRANCO BELGIORNO-NETTIS
Plaintiff/Appellant
AND
AUCKLAND UNITARY PLAN INDEPENDENT HEARINGS PANEL
First Defendant
AND
AUCKLAND COUNCIL
Second Defendant/Respondent
Hearing: On the papers Counsel:
S J Ryan and R H Ashton for Plaintiff/Appellant
M J L Dickey and R S Ward for Respondent/Second Defendant Dr C E Kirman and A K Devine for Housing New Zealand
Corporation (Intervenor)Judgment:
3 May 2018
COSTS JUDGMENT OF PAUL DAVISON J
This judgment was delivered by me on 3 May 2018 at 1pm
pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Atkins Holm Majurey, Auckland; Brookfields, Auckland; Ellis Gould, Auckland
BELGIORNO-NETTIS v AUCKLAND UNITARY PLAN INDEPENDENT HEARINGS PANEL COSTS JUDGMENT [2018] NZHC 926 [3 May 2017]
Background
[1] Mr Belgiorno-Nettis appealed from and sought judicial review of a decision of the Auckland Council in relation to an aspect of the Auckland Unitary Plan. Both the appeal and judicial review were primarily founded on the proposition that the Independent Hearings Panel and the Council failed to provide reasons (or adequate reasons) for their recommendations and decisions.
[2] Housing New Zealand Corporation was a party to the appeal under s 301 of the Resource Management Act 1991 and was granted leave to intervene in the application for judicial review.
[3] On 29 September 2017, I issued a judgment dismissing both the appeal and judicial review.1 I concluded that the Panel had given adequate reasons, and further that the Council was not required to give reasons where it simply accepted the Panel’s recommendations. This meant there was no error of law; nor was there a breach of the requirements of natural justice.
[4] Mr Belgiorno-Nettis then applied under s 67 of the Judicature Act 1908 for leave to appeal my judgment of 29 September 2017. The Council opposed the application for leave on the grounds that the proposed appeal did not raise any matters of general or public importance, or was capable of bona fide serious argument. Housing New Zealand, acting as an intervener, adopted the Council’s submission and also argued that Mr Belgiorno-Nettis had no right of appeal beyond the High Court.
[5] I declined the application for leave to appeal on 19 March 2018.2 Although I held that it was open to Mr Belgiorno-Nettis to seek leave to appeal (contrary to Housing New Zealand’s submission), I considered that Mr Belgiorno-Nettis had failed to demonstrate that the questions of law he wished to raise in his proposed appeal involved matters of sufficient importance to justify granting leave to appeal.
1 Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel [2017] NZHC 2387, [2018] RMA 1.
2 Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel [2018] NZHC 459.
[6] Housing New Zealand and the Auckland Council both now seek costs on a Category 2B basis in respect of my substantive judgment of 29 September 2017 and the application for leave to appeal.
[7]In respect of the substantive judgment, the Council calculates its costs at
$36,572 and also seeks disbursements of $360. Housing New Zealand calculates its costs at $25,164, and seeks disbursements of $524.
[8] In respect of the application for leave to appeal, the Auckland Council seeks costs of $3,345 and disbursements of $110. Housing New Zealand seeks costs of
$4,683 and no disbursements.
[9] Mr Belgiorno-Nettis is opposed to any award of costs against him, or alternatively seeks a reduction in costs. He says that the proceeding concerned a matter of public interest, and that he acted reasonably in the conduct of the proceeding.3 He also submits that he was partially successful on the application for leave to appeal, which warrants a reduction in costs.4
[10] Since my decision declining leave to appeal, Mr Belgiorno-Nettis has filed a further notice of appeal in the Court of Appeal. He submits that if costs are to be fixed in the High Court, payment of any award should be deferred pending the outcome of the appeal to the Court of Appeal. He also objects to any costs award being made in favour of Housing New Zealand.
Should costs orders be deferred until the decision of the Court of Appeal?
[11] There is no presumption that a determination of costs should be deferred until after an appeal is heard.5 In the present case, as in He v Earthquake Commission, the parties have gone to the trouble of filing costs memoranda and it is appropriate that
3 High Court Rules 2016, r 14.7(e).
4 High Court Rules, r 14.7(d).
5 He v Earthquake Commission [2018] NZHC 67 at [71]; New Zealand Alpine Pilots’ Association Industrial Union of Workers Inc v Director of Civil Aviation [2016] NZHC 2409, (2016) 23 PRNZ 276 at [4]; McArthur Ridge Investments v Schulz [2015] NZHC 600 at [13]–[15].
the determination of costs is not deferred too far into the future.6 I therefore consider it appropriate to determine the matter of costs now.
[12] Mr Belgiorno-Nettis submits that while the Court might now fix costs, an order should be made that costs are not payable until the final determination of the proceeding. A similar order was sought in McArthur Ridge Investments v Schulz, and Mander J observed:7
[15] In my view, there is no reason why the question of costs ought not be determined in the usual way. It will remain open to the defendant to seek a stay of enforcement pending the outcome of its appeal if it considers such a course is necessary. That is a discrete issue which would involve different considerations, about which I am not presently informed.
[13] However, in that case the plaintiff acknowledged the extant appeal and had indicated that it would consider a practical approach as to whether, pending the appeal, any steps should be taken to enforce the award.8 No such indication has been given in the present case. I therefore propose to make an order that compliance with any costs award, or enforcement of any such award, is to await the determination or other final disposition of the appeal.
Should an award of costs be refused or reduced under the public interest exception?
[14] Although costs awards in the High Court are discretionary,9 they are governed by the fundamental principle that the party who fails should pay costs to the party who succeeds.10 The determination of costs should, so far as possible, be predictable and expeditious.11 However, the Court may refuse to make an order for costs, or may reduce costs, if the proceeding concerned a matter of public interest, and the party opposing costs acted reasonably in the conduct of the proceeding.12
6 He v Earthquake Commission [2018] NZHC 67 at [71].
7 McArthur Ridge Investments v Schulz [2015] NZHC 600.
8 See [14].
9 High Court Rules 2016, r 14.1.
10 High Court Rules, r 14.2(1)(a); see also Manukau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305 at [8].
11 High Court Rules, r 14.2(1)(g).
12 High Court Rules, r 14.7(e).
[15] Here Mr Belgiorno-Nettis says the proceedings were a “test case” and did not involve the application of settled law. In his submission, the case involved the application of principles of law with implications beyond the present case, and it will have precedent value in other cases relating to the approach to grouping of reasons for site-specific zoning submissions. He points out that the High Court has now heard several cases concerning this issue. Although each individual appellant necessarily focused on their own individual area or site-specific concerns, he says that with the benefit of hindsight the appeals could have been run together as a joint test case.
[16] For the “public interest” exception to apply, the proceeding must concern a matter of genuine public interest, have merit and be of general importance beyond the interests of the particular unsuccessful litigant.13 A matter that arises out of a private interest does not become a matter of public interest simply because the public benefits generally from its determination, such as settling the correct interpretation of a piece of legislation.14
[17] I consider that the present case falls into the latter category, and that the public interest exception cannot be invoked. Mr Belgiorno-Nettis had a vested interest in the proceedings, in that he owned property in the Takapuna area. It was not a case in which the litigant has no personal interest at stake.15 Nor was it a case that raised entirely novel or untested points of public law: in Albany North Landowners v Auckland Council, for example, Whata J had already held that the Panel did not have a duty to identify specific submissions seeking relief on an area-by-area basis with specific reference to suburbs, neighbourhoods or streets.16
[18] Mr Belgiorno-Nettis relies on the Environment Court’s practice of not awarding costs to any party in appeals relating to a proposed plan. That approach is of course not binding on this Court. However, he cites comments made by Whata J in Ancona Properties Ltd v Auckland Council in support of that approach.17
13 Taylor v District Court at North Shore (No 2) HC Auckland CIV-2009-404-2350, 13 October 2010 at [9], cited in New Health New Zealand Inc v South Taranaki District Council [2014] NZHC 993, (2014) 21 PRNZ 766 at [10].
14 Wong v Registrar of the Auckland High Court (2008) 19 PRNZ 32 (HC) at [18].
15 Wong v Registrar of the Auckland High Court (2008) 19 PRNZ 32 (HC) at [24].
16 Albany North Landowners v Auckland Council [2017] NZHC 138 at [139]–[144].
17 Ancona Properties Ltd v Auckland Council [2017] NZHC 981.
[6] In this context, the practice of the Environment Court provides guidance. The Environment Court Practice Note of December 2014 relevantly states:
6.6 Costs
The following issues are relevant to the practice of the Court in considering costs issues:
…
(b) Where an appeal against a proposed policy statement, plan, or plan change under Schedule 1 to the RMA has proceeded to a hearing, costs will not normally be awarded to any party.
(c) If the decision appealed against would have imposed an unusual restriction upon the appellant's rights, and the restriction is not upheld, costs may be awarded against the respondent Council. On other appeals, the Court will not normally award costs against the public body whose decision is the subject of the appeal unless it has failed to perform its duties properly or has acted unreasonably.
[7] This practice accords with the policy of the RMA to encourage public participation in planning review processes. It also takes into account the considerable burden already carried by the Council in plan promulgation processes and that imposing costs for diligently discharging that burden, in a reasonable way, will not ordinarily be in the public interest. It also reflects the reality that this is nothing like ordinary civil adversarial litigation where the parties are engaged in a private dispute.
(footnotes omitted)
[19] In Ancona Properties, Whata J declined to award costs to the successful appellant where the Council had conceded it made a technical error in the wording of the Auckland Unitary Plan. The considerations involved were somewhat different to the present case: Whata J referred to the “considerable burden already carried by the Council in plan promulgation processes”, and concluded that an award of costs against the Council would not be in the public interest.18 That is not the position here. Mr Belgiorno-Nettis brought an unsuccessful appeal and judicial review against the Council’s decision in respect of a matter in which he had a private interest. I consider that there are no grounds to displace application of the ordinary principle that costs follow the event.
18 At [7].
Should costs be reduced on the grounds Mr Belgiorno-Nettis was partially successful on the application for leave to appeal?
[20] Mr Belgiorno-Nettis submits that he was partially successful on the application for leave to appeal, in that Housing New Zealand failed in its argument that the Court lacked jurisdiction to grant leave to appeal. He seeks a reduction in costs for this reason.
[21] Housing New Zealand and the Auckland Council were undoubtedly the successful parties overall on the application for leave to appeal, in that leave was ultimately declined. They are therefore prima facie entitled to costs. However, under r 14.7(d) of the High Court Rules 2016, a costs order may be reduced if, “although the party claiming costs has succeeded overall, that party has failed in relation to a cause of action or issue which significantly increased the costs of the party opposing costs”.
[22] It is not uncommon for a party to succeed on one issue but fail on another, or several others. Ordinarily this will not of itself be a reason for a reduction in costs.19 However, where some of the successful party’s arguments were excessive, irrelevant or entirely without merit, thereby putting the other party to significant additional expense, a reduction in costs may be warranted.20
[23] In the present case I do not consider that Housing New Zealand’s arguments as to jurisdiction can be described as excessive, irrelevant or entirely without merit. On the contrary, I was significantly assisted by their detailed submissions on this difficult point. A reduction in costs on the basis that their arguments were ultimately unsuccessful is not justified.
Should costs be awarded to Housing New Zealand as an intervener?
[24] Housing New Zealand was a party to the appeal under s 301 of the Resource Management Act, and an intervener in the judicial review. It now seeks costs in respect of both the substantive judgment and the application for leave to appeal on the basis that it successfully opposed both, and was put to significant cost in doing so. It submits
19 Shotter v Westpac Banking Corp HC Auckland AP995/85, 5 June 1991.
20 See New Zealand Law Society v Deliu [2015] NZHC 652 at [6]–[8]; Zhao v New Zealand Law Society [2012] NZHC 3112 at [10].
that there is no difficulty in principle in awarding costs to an intervener, citing Diagnostic Medlab Ltd v Auckland District Health Board.21 In that case, costs were awarded to the Harbour Primary Health Organisation as intervener.22 Asher J observed that it was “undoubtedly of benefit to the Court to have the intervener as a separate party”.23 The intervener made a particular and valuable contribution, as it was able to present a perspective as to the need for consultation that the plaintiff, Diagnostic Medlab Ltd, could not.24 Asher J relied on s 99A of the Judicature Act 1908, which has now been replaced by s 178 of the Senior Courts Act 2016 and gives the Court a broad discretion to award costs to an intervener:
178 Costs where intervener or counsel assisting court appears
(1)This section applies to proceedings in any senior court or other court.
(2)If the Attorney-General or the Solicitor-General or any other person appears as an intervener or counsel to assist the court in any civil proceedings or in any proceedings on any appeal and argues any question of law or of fact arising in the proceedings, the court may, subject to the provisions of any other Act, make any order it thinks just—
(a) as to the payment by any party to the proceedings of the costs incurred by the Attorney-General or the Solicitor-General in so doing; or
(b) as to the payment by any party to the proceedings or out of public funds of the costs incurred by any other person in so doing; or
(c) as to the payment by the Attorney-General or the Solicitor- General or that other person of any costs incurred by any of those parties by reason of his or her so doing.
(3)If the court makes an order under subsection (2)(b), the Registrar of the court must forward a copy of the order to the chief executive of the Ministry of Justice who must make the payment out of money appropriated by Parliament for the purpose.
[25] In Earthquake Commission v Insurance Council of New Zealand Inc, a full Court of the High Court set out a list of factors applicable to the determination of costs
21 Diagnostic Medlab Ltd v Auckland District Health Board HC Auckland CIV-2006-404-4724, 13 June 2007 at [22].
22 Although note that the Court of Appeal subsequently allowed an appeal against the substantive decision, meaning the High Court was required to reconsider the question of costs: see Diagnostic Medlab Ltd v Auckland District Health Board (No 2) HC Auckland CIV-2006-404-4724, 23 October 2009.
23 At [21].
24 At [26].
under s 99A of the Judicature Act (now s 178 of the Senior Courts Act).25 Relevantly for present purposes, one consideration was whether the applicant had provided material assistance to the Court by presenting evidence or submissions on an issue or issues not adequately covered by other parties or at all.
[26] The Court in Earthquake Commission commented that cases in which costs have been awarded against a party in favour of an intervener are comparatively rare.26 It declined to award costs in favour of the intervener, distinguishing Diagnostic Medlab on the grounds that the interveners had not made a significant and unique contribution in the sense explained by Asher J in that case.27
[27] Mr Belgiorno-Nettis is opposed to any award of costs in favour of Housing New Zealand. He submits that the general approach is that only one set of costs is allowed. He refers to r 14.15 of the High Court Rules, which provides:
14.15 Defendants defending separately
The court must not allow more than 1 set of costs, unless it appears to the court that there is good reason to do so, if—
(a)several defendants defended a proceeding separately; and
(b)it appears to the court that all or some of them could have joined in their defence.
[28] This rule requires the Court to exercise some caution in awarding costs to multiple parties where there is some overlap or a degree of common interest in the litigation position of the parties seeking costs.28 In Independent Māori Statutory Board v Auckland Council, Wylie J relied on this rule to award only one set of costs in respect of two s 301 parties.29 He was influenced by the following considerations:
[12] Each of the s 301 parties did emphasise different matters, but they did have a considerable community of interest. They did not run separate cases. They did not seek separate relief. The impact on each of them in successively opposing the appeal was identical — the disputed provisions would not be
25 Earthquake Commission v Insurance Council of New Zealand Inc [2015] NZHC 457, (2015) 22 PRNZ 427 at [6].
26 Earthquake Commission v Insurance Council of New Zealand Inc [2015] NZHC 457, (2015) 22 PRNZ 427 at [7].
27 At [25].
28 Independent Māori Statutory Board v Auckland Council [2017] NZHC 678 at [8].
29 Independent Māori Statutory Board v Auckland Council [2017] NZHC 678.
introduced into the proposed Unitary Plan. There was no likely conflict of interest. Personal reputations were not at stake …
[13] There is nothing to suggest that Democracy Action took legal advice as to the appropriateness of separate or joint representation.
[29] I consider that costs should be awarded to Housing New Zealand as a s 301 party in the appeal to the High Court and intervener in the judicial review proceeding, and as intervener in the application for leave to appeal. At all stages of the proceeding it provided significant assistance to the Court, which went beyond the assistance that the Council was able to provide. In much the same way as the intervener in Diagnostic Medlab, Housing New Zealand, as a substantial Auckland property owner, presented a perspective on the issues arising in the case that the Council itself was unable to present. This was not a situation where it would have been appropriate for the Council and Housing New Zealand to have collaborated to present joint submissions. Their respective positions were such that it was appropriate for them to proceed by way of separate submissions, made from their quite different perspectives.
[30] I consider the present case to be closely comparable to that which arose in Diagnostic Medlab Ltd, where costs were granted to the intervener, and distinguishable from Independent Māori Statutory Board v Auckland Council where the s 301 parties ran effectively identical cases.
Quantum of costs
[31] The Auckland Council and Housing New Zealand both seek costs on a Category 2B basis. Mr Belgiorno-Nettis does not take issue with that categorisation, although he argues that costs should be reduced for other reasons. I have already rejected that submission above. Category 2B appropriately reflects the time and skill involved in the proceedings and the application for leave to appeal.
[32] In relation to the appeal and judicial review proceedings heard in 2017, both the Auckland Council and Housing New Zealand seek costs for the appearance at the hearing of second counsel. I consider that the nature and complexity of the issues and volume of evidentiary material to be addressed justified the involvement of second counsel.
[33] Both also seek an allocation of three days for the preparation of written submissions in respect of the substantive judgment, when Schedule 3 to the High Court Rules provides that 1.5 days is appropriate for Category B. Although there were two sets of proceedings, the appeal and judicial review, the issues that arose had substantial commonality and overlap, and I consider that 1.5 days’ preparation should be allowed.
[34]No other issues arise as to the itemisation of costs.
Result
[35] The Auckland Council and Housing New Zealand are entitled to Category 2B costs and disbursements in respect of both the substantive judgment and the application for leave to appeal.
[36] With the adjustment mentioned at [33] above, costs and disbursements in respect of the 29 September 2017 judgment come to:
Auckland Council
Housing New Zealand
Costs
$33,227
$20,739
Disbursements
$360
$524
Total
$33,587
$21,263
[37] Costs and disbursements in respect of the application for leave to appeal come to:
Auckland Council
Housing New Zealand
Costs
$3,345
$4,683
Disbursements
$110
$0
Total
$3,455
$4,683
[38] However, enforcement of the costs orders made at [35]–[37] above is to await the determination or other final disposition of the appeal to the Court of Appeal.
Paul Davison J
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