CTS Investments LC v Palmerston North City Council
[2023] NZHC 1742
•5 July 2023
IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY
I TE KŌTI MATUA O AOTEAROA TE PAPAIOEA ROHE
CIV-2022-454-00099
[2023] NZHC 1742
IN THE MATTER of the Judicial Review Procedure Act 2016, entailing an application for Judicial Review, and associated relief BETWEEN
CTS INVESTMENTS LLC
First Plaintiff
WOODGATE LIMITED
Second PlaintiffTERRA CIVIL LIMITED
Third PlaintiffAND
PALMERSTON NORTH CITY COUNCIL
Defendant
Hearing: 26 June 2023 Counsel:
G J Woollaston for Plaintiffs N Jessen for Defendant
Judgment:
5 July 2023
JUDGMENT OF RADICH J
Introduction
[1] In August 2022, Palmerston North City Council (the Council) notified a plan change – known as Plan Change G (PCG) – to provide additional housing supply in the Aokautere area, to the southeast of Palmerston North City.
[2] When it did so, it was in the course of processing resource consent applications by the second applicant, Woodgate Limited (Woodgate) for a retirement village on
CTS INVESTMENTS LLC v PALMERSTON NORTH CITY COUNCIL [2023] NZHC 1742 [5 July 2023]
land to which PCG related.1 Two months after PCG was notified, the Environment Court, on the Council’s application, made orders bringing PCG into immediate effect, in advance of public hearings on PCG which are scheduled to take place later in the year.
[3] The PCG provisions place obligations on the applicants in the development of the proposed retirement village that are more onerous than would have been the case if the resource consent applications had been considered under the provisions of the Palmerston North City Council District Plan (the District Plan) that are replaced by PCG.2
[4] The applicants have submitted in opposition to PCG. They have not challenged the Environment Court’s decision. However, in this proceeding they seek orders setting aside the Environment Court’s decision and, effectively, setting aside the Council’s decision to notify PCG on the basis of allegations that:
(a)The Council, in preparing PCG, failed to consult with people who represented adequately the interests of the applicants.
(b)To the extent that it did consult with people who represented the interests of the applicants, the Council did not provide sufficient information to enable them to assess the impacts of PCG and to provide meaningful submissions.
(c)The applicants should have been given notice of the Council’s intention to make an application under s 86D of the Resource Management Act 1991 (the RMA) for PCG to have immediate effect.
[5]The issues that arise are these:
(a)What is the nature and extent of the Council’s obligation to consult during the preparation of a proposed plan?
1 As it is described more fully below, Woodgate is proposing to develop the retirement village land owned by the first applicant, CTS Investments LLC, and the third applicant, Terra Civil Limited, and is a land development company, acting as an agent for CTS Investments and Woodgate.
2 The applicants resource consent application would fall to be determined under PCG as it was returned by the Council as being incomplete after the Plan Change was notified.
(b)Did the Council consult during the preparation of PCG with people who represented sufficiently the interests of the applicants?
(c)Did the Council, in consulting with people it regarded as representing sufficiently the interests of the applicants, provide those people with adequate information to enable consultation to be meaningful?
(d)Should the applicants have been given notice of the Council’s s 86D application?
(e)If there was a flaw in the consultation undertaken by the Council on PCG:
(i)Is the relief sought by the applicants available to them?
(ii)If relief is available, should the Court in the exercise of its discretion, decline to grant relief by reason of three factors advanced by the Council: an alleged lack of prejudice, delay and improper purpose through the proceeding being, in effect, a collateral attack on the Environment Court’s s 86D decision?
[6] For the reasons I go on to give, I have not found there to have been any flaws in the consultation undertaken by the Council as it was preparing PCG and, had there been a flaw, it would not have been appropriate for the Court to have granted the relief that is sought.
Background
The parties
[7] CTS Investments LLC (CTS), incorporated in the United States of America, owns a 48.16 ha parcel of land just to the northeast of Pacific Drive in the Aokautere residential area in Palmerston North. Woodgate has an unconditional sale and purchase agreement over the land with CTS. The transfer has yet to take place but Woodgate refers to itself as being the equitable owner of the land.
[8] Leslie Fugle (Mr Fugle) is Woodgate’s primary director and shareholder. Woodgate is a land development company.
[9] Terra Civil Limited (Terra Civil) is a land development company as well. It is described as being “the agent for CTS Investments and Woodgate Limited”.3
The retirement village application
[10] On 19 March 2022, Woodgate applied for a resource consent to undertake earthworks for the proposed retirement village.4 On 13 July 2022, it applied for a land use and subdivision consent to construct and operate a retirement village complex on the Pacific Drive land (the retirement village application).
[11] On 8 August 2022, the Council publicly notified PCG. It had been discussing with landowners in the area covered by PCG the potential changes it would bring on occasions since 2018, as outlined in more detail in [53] below.
[12] On 9 August 2022, the Council returned the retirement village application under s 88(3A) of the RMA as incomplete because it did not include certain mandatory information in its geotechnical report and because information on landscape, urban design, stormwater management and traffic was regarded as being insufficient.
[13] On 10 August 2022, Mr Fugle objected to the Council’s decision to return the application “on behalf of the applicant” under s 357 of the RMA. The objection was not upheld.
[14] On 25 August 2022, the Council applied to the Environment Court for an order, under s 86D of the RMA, that PCG be given immediate effect, notwithstanding that the public submission process had not concluded and hearings had not begun. As is common (as discussed further below), the application was brought by the Council on an ex parte basis. It was granted by the Environment Court on 25 October 2022.
3 In the applicants’ joint submission on PCG of 5 September 2022. It was explained during the hearing that Terra Civil is a company that is controlled by or on behalf of Mr Fugle’s children and stepchildren. It has significant land holdings adjacent to the CTS land, with which this proceeding is concerned.
4 The proposed earthworks covered an 8.4 ha area, involved the movement of 3,400 metres of earth and the work was projected to take 11 weeks.
[15] As a result of the retirement village application having been returned by the Council, on 31 August 2022, Woodgate made a new application for a resource consent to begin the earthworks for the retirement village. That application remains extant.
[16] CTS, Woodgate and Terra Civil have prepared a joint submission on PCG and will be heard on the submission later in the year.
Plan Change G
[17] PCG has been under development since 2018. Its purpose is to provide additional housing supply in Aokautere to help meet growth projections for Palmerston North over the medium to long term. Palmerston North’s population is projected to increase by over 31,000 people over the next 30 years – from 90,500 to 121,664 people. Five hundred new dwellings are said to be needed each year between now and 2031 and PCG forms a part of the approach taken by the Council to cater for that growth. It will do so by rezoning land and providing 1,050 new homes of differing densities.
[18] The development of PCG followed a master plan process – a high-level plan that provides a conceptual layout to guide future growth and development. The master planning process saw the creation, alongside PCG, of a structure plan – a series of maps and diagrammatic representations of the proposed zoning, layout, features, character and transportation links for areas being developed.
[19]To give effect to the structure plan, PCG:
(a)rezones 454 ha of land within the structure plan area from rural- residential and recreation to residential, local business, conservation and amenity zones;
(b)makes provision for a proposed Aokautere residential area with an associated set of objectives, policies and rules;
(c)makes provision for a proposed local business zone with the addition of the Aokautere Neighbourhood Centre Precinct Plan which includes
a set of objectives, policies and rules for the development of a local centre; and
(d)rezones a network of gullies within the area to become part of a conservation and amenity zone.5
[20] As is discussed in further detail in [53] and [54] below, in preparing PCG, the Council consulted under cl 13 of sch 1 of the RMA with iwi, landowners, government departments and agencies, community groups and members of the community. The report under s 32 of the RMA, required to accompany a plan change proposal, describes the Council as having engaged, in particular, with the three landowners who owned the developable land within Aokautere. Mr Fugle was seen by the Council as the representative of one of those landowners. The Council described the interests of the applicants as “the Fugle interests”.
[21] Submissions on PCG closed on 5 September 2022. One hundred and seven submissions were received. Hearing commissioners are being appointed and it is expected that submissions on the Plan Change will be heard in the last quarter of the year.
The Environment Court decision
[22] Under s 86D of the RMA, a local authority may apply, before or after a proposed plan is publicly notified under cl 5 of sch 1 of the RMA, to the Environment Court for rules in the plan to have legal effect from a date other than the date on which the decision on submissions relating to the rules in the plan would normally be made and publicly notified under cl 10(4) of sch 1 of the RMA.6
[23] The Act does not specify the process to be followed or the criteria to be applied in determining an application under s 86D. However, as the Environment Court has said, it was likely to have been contemplated by Parliament that, in the normal course of events, applications under the provision will be determined by the Court on an
5 As described in [85] of the s 32 report on PCG.
6 Resource Management Act 1991, s 86D(2).
ex parte basis.7 If other parties were involved in the process, there may well be substantial delay and the s 86D process would effectively give rise to the premature consideration of issues that need to be considered by a Council itself through its hearings on a plan change proposal under sch 1.
[24] That reality is illustrated in the Environment Court’s decision here in which the Court observed that the retirement village application was before the Council and that, if the application was considered as a controlled activity subdivision under the rules that PCG would replace, that would put at risk the planning strategy and related benefits that were intended from PCG.8
[25] The Environment Court described the discussions that had taken place in 2019 and 2020 between the Council and landowners on PCG in the following terms:
[36] Landowner discussions took place in 2019 and 2020 regarding the draft Structure Plan, with the availability of more residentially zoned land in the area generally supported. One of the messages was that the landowners wanted re-zoning to occur quickly. … The other major landowner, Les Fugle, was supportive of rezoning to enable more development, but did not support the Council’s structure plan approach, protection of the gullies from development, stormwater management controls, the inclusion of a LBZ and the provision of medium density housing.
[37] Further discussions with landowners occurred over 2021 and 2022 around specific issues. The concept of a retirement village was discussed with one landowner (Mr Fugle) including its relationship with the proposed Structure Plan. A retirement village has been provided for within the Structure Plan but is carefully located in a manner that complements and supports the planning strategy for the Aokautere growth area.
(Footnotes omitted).
[26] The Court’s reasons for its view that PCG should be given immediate effect were these:
[53] Although the area affected is large, the Council has engaged with the landowners. The activity status of some activities will be more stringent and there will be more standards and matters to address when making applications for resource consent. PCG will have a definite impact on landowners who wish to develop their land in a way that is contrary to the structure plan in PCG. However, I consider the risk to the environment in terms of the ongoing effects of unplanned subdivision and development are such that it is appropriate, and in fact necessary, that the PCG rules be given legal effect now
7 Re New Plymouth District Council [2011] NZEnvC 8 at [35] and [36].
8 Re Palmerston North City Council [2022] NZEnvC 214 at [18], [21] and [52].
rather than when decisions on submissions are made. It is difficult to ‘take back’ poor planning outcomes that fail to provide for necessary housing and appropriate infrastructure and that damage the natural environment. Affected landowners (and members of the public) now have the opportunity to challenge the provisions through the Schedule 1 process.
The applicants’ submission on Plan Change G
[27] In their 5 September 2022 submission on PCG, the applicants described themselves in the following way:
The submitters are one of three major landowning interests associated with the Plan Change area as shown on map page 13 of the Master Plan document being the land labelled as “Fugle Interests”.
[28] Page 13 of the master plan document shows three large tracts of land within the PCG area. One is labelled “Fugle Interests”, the second is labelled “Green Interests” and the third is labelled “Waters Interests”. Green and Waters are the other landowners who have interests within the PCG area. The way in which Mr Fugle’s name is lent to the interests of all three applicants in this proceeding is relevant to the second issue that is discussed below.
[29] In their submission on PCG, the matters raised by the applicants include the following:
(a)They were concerned that PCG would impose a specific design solution on the development of the area.
(b)They observed that some land was “down zoned” from residential to conservation.
(c)They saw PCG as representing a “major shift” from enabling developments to be designed and tested through resource consent processes to directing design solutions from the outset.
(d)They saw the implementation of PCG through the structure plan being more akin to a “detailed design master plan”.
(e)They expressed the view, as they do in this proceeding, that a joint process should have been in place with landowners at the outset – a form of partnership.
(f)They were concerned about the direction to establish a neighbourhood centre in the retirement village area.
(g)They were opposed to the extent of medium density residential development that was being directed.
(h)They expressed concerns about what they saw as being errors in supporting technical reports.
(i)While supporting provision made in PCG for the retirement village, they believed that the site should be extended to the southeast.
(j)A proposed road in the plan was opposed, as was a change from residential zoning to conservation and amenity zoning in a part of the plan.
(k)They opposed the proposed location of the neighbourhood centre, submitting that it should be located elsewhere.
(l)They opposed assessment criteria for retirement villages.
(m)They opposed the requirement for transport network improvements to be in place before subdivision.
(n)They opposed proposed non-complying activity rules.
[30] The applicants’ submission on PCG illustrates the extent to which they are affected by it. The effects on them are confirmed by Mr Dunidam, the principal planner at the Council. In evidence for the s 86D process, he observed that, unlike the position under the previous rules, a retirement village would be assessed under PCG on the basis of its location within the structure plan, its connectivity with the roading network, the ways in which it integrates with proposed local business zones, a number of specific design outcomes and principles and the availability and timing of infrastructure, including identified transport infrastructure. If a proposed retirement village is not located and developed in accordance with the structure plan, it would become, under PCG, a non-complying activity.
Legal principles
[31] Schedule 1 of the RMA makes provision for the preparation, change and review of policy statements and plans.
[32] Under cl 3(1), during the preparation of a proposed plan, a local authority “shall consult” with an identified list of groups and office holders including Ministers of the Crown, local authorities and tangata whenua. Clause 3(2) adds to the mandatory requirements in subcl (1) a residual discretion, in the following terms:
(2) A local authority may consult anyone else during the preparation of a proposed policy statement or plan.
[33]Subclause (4) adds:
(4)In consulting persons for the purposes of subcl (2), a local authority must undertake the consultation in accordance with s 82 of the Local Government Act 2002.
[34] Section 82 of the Local Government Act 2002 (the Local Government Act) is a long provision but it needs to be set out because different parts of it are relevant here. It is in the following terms:
82 Principles of consultation
(1)Consultation that a local authority undertakes in relation to any decision or other matter must be undertaken, subject to subsections
(3) to (5), in accordance with the following principles:
(a)that persons who will or may be affected by, or have an interest in, the decision or matter should be provided by the local authority with reasonable access to relevant information in a manner and format that is appropriate to the preferences and needs of those persons:
(b)that persons who will or may be affected by, or have an interest in, the decision or matter should be encouraged by the local authority to present their views to the local authority:
(c)that persons who are invited or encouraged to present their views to the local authority should be given clear information by the local authority concerning the purpose of the consultation and the scope of the decisions to be taken following the consideration of views presented:
(d)that persons who wish to have their views on the decision or matter considered by the local authority should be provided
by the local authority with a reasonable opportunity to present those views to the local authority in a manner and format that is appropriate to the preferences and needs of those persons:
(e)that the views presented to the local authority should be received by the local authority with an open mind and should be given by the local authority, in making a decision, due consideration:
(f)that persons who present views to the local authority should have access to a clear record or description of relevant decisions made by the local authority and explanatory material relating to the decisions, which may include, for example, reports relating to the matter that were considered before the decisions were made.
(2)A local authority must ensure that it has in place processes for consulting with Māori in accordance with subsection (1).
(3)The principles set out in subsection (1) are, subject to subsections (4) and (5), to be observed by a local authority in such manner as the local authority considers, in its discretion, to be appropriate in any particular instance.
(4)A local authority must, in exercising its discretion under subsection (3), have regard to—
(a)the requirements of section 78; and
(b)the extent to which the current views and preferences of persons who will or may be affected by, or have an interest in, the decision or matter are known to the local authority; and
(c)the nature and significance of the decision or matter, including its likely impact from the perspective of the persons who will or may be affected by, or have an interest in, the decision or matter; and
(d)the provisions of Part 1 of the Local Government Official Information and Meetings Act 1987 (which Part, among other things, sets out the circumstances in which there is good reason for withholding local authority information); and
(e)the costs and benefits of any consultation process or procedure.
…
[35] As the Environment Court has observed, the discretion to consult in cl 3(2) is left deliberately wide in order that a council can, in appropriate cases, consider the
groups of people it may wish to consult.9 The Environment Court observed in Waikato Tainui Te Kauhanganui Inc v Hamilton City Council that, while s 82 of the Local Government Act does not apply expressly to cls 3(1) and (3), which identify those with which local authorities “shall consult”, it was likely that Parliament intended the provision to apply to cl 3(2) to ensure that discretionary consultation undertaken by a local authority under that clause was meaningful.10
[36] While that must be so, and while s 82 will provide clear guidance to local authorities on the principles of consultation, it is no more than that: an expression of the common law consultation requirements. Those common law requirements will apply alongside s 82 and must, equally, inform the decision on the part of a local authority on whether to consult and, if so, how it will consult under cl 3(2).
[37] In these circumstances, it is necessary to say something about the common law requirements. They have been expressed so well in so many cases that the summary that follows can only be regarded as a skim across the relevant principles with an eye to the facts and circumstances of this case.
[38] Consultation is the way in which, for certain exercises of public power, the principles of natural justice are applied. A right to natural justice is triggered if an exercise (or a proposed exercise) of public power will be likely to affect someone’s rights, interests or expectations.11
[39] However, the requirements of natural justice – the form the consultation should take – will vary materially, depending on the circumstances of any given case. At one end of the spectrum, a decision maker acting in accordance with the principles of natural justice might need to hold a hearing and allow for the examination of witnesses and the presentation of submissions. At the other, it might be enough for there to have been a conversation or an exchange of emails. Relevant factors will include the nature of the person or entity being consulted, the nature of the interest at stake (whether the
9 Thomas v Bay of Plenty Regional Council EnvC Christchurch A011/08, 1 February 2008 at [52]. See also Briggs v Kapiti Coast District Council [2011] NZEnvC 57.
10 Waikato Tainui Te Kauhanganui Inc v Hamilton City Council [2010] NZRMA 285 (HC) at [47].
11 See generally CCSU v Minister for the Civil Service [1985] AC 374 (HL); Daganayasi v Minister of Immigration [1980] 2 NZLR 130 (CA); and Wellington International Airport Limited v Air New Zealand [1993] 1 NZLR 671 (CA).
power will cause an inconvenience or affect a liberty), the statutory scheme, the nature of the power being exercised, whether there will be further opportunities for input and whether there have been prior opportunities for input.12
[40] Accordingly, consultation on a high-level policy might properly be carried out with representatives or focus groups while a decision on a particular issue will be likely to require consultation with everyone who may be affected. The point is that, depending upon the decision in question, consultation need not always involve consulting individually with all affected persons.13
[41] The essential ingredients of consultation, as relevant here, may be summarised in the following way:
(a)It requires a meaningful opportunity to comment at an appropriate stage on a proposed exercise of power.14
(b)Those to be consulted must be provided with details of relevant information the decision maker is likely to take into account so that intelligent responses may be made.15
(c)Sufficient time must be allowed to enable a reasonable opportunity for those consulted to express their views.16
(d)Consultation cannot be treated as a mere formality. By the same token, it is not negotiation. There is no requirement that those consulted should agree with the final decision.17
(e)A decision maker must maintain an open mind and be ready to change its mind or even start afresh in the context of resource consent decision- making (rather than, for example, decision making by a judicial
12 See generally R v Home Secretary, ex parte Doody [1994] 1 AC 531, [1993] 3 All ER 92 at 106; and Ali v Deportation Review Tribunal [1997] NZAR 208 (HC).
13 XY v Attorney-General [2016] NZHC 1196, [2016] NZAR 875.
14 New Zealand Maori Council v Attorney-General [the Forests case] [1989] 2 NZLR 142 (CA) at 152.
15 R v North and East Devon Health Authority, ex parte Coughlan [2001] QB 213 (CA) at [108].
16 Diagnostic Medlab Limited v Auckland District Health Board [2007] 2 NZLR 832 (HC) at [290].
17 New Zealand Pork Industry Board v Director-General of Ministry for Primary Industries [2013] NZSC 154, [2014] 1 NZLR 477 at [168].
officer). The test in resource consent decision-making is whether the Council approached the decision with a closed mind.18
[42] From these broad principles, the nature and extent of the obligation to consult on the preparation of a proposed plan under cl 3(2) falls to be considered.
First issue – what is the nature and extent of the Council’s obligation to consult during the preparation of a proposed plan?
[43] For the Council it is said that cl 3(2) of sch 1 of the RMA and s 82 of the Local Government Act work separately. It is said that, first, the Council has a discretion as to who it will consult with under cl 3(2) and then, having determined that, it will turn to s 82 to consider how it will consult with them. It is said that, at the first step, the Council has an option to design a consultative process that is administratively efficient and appropriate to the nature of the proposal which may involve, for example, consultation with representatives with classes of interested people or spokespeople of interested groups. But it does acknowledge that the Council should, at the first step, be informed by common law natural justice principles.
[44] I do not believe that the two provisions work in silos as has been suggested. As discussed in [39], who to consult with and the way in which consultation should be undertaken requires a consideration of a range of factors.
[45] Section 82(1)(a) and (b) of the Local Government Act, for example, requires the Council to consider who the persons are who will or may be affected by a decision. The provisions work together.
[46]In this case, the following considerations are relevant:
(a)The discretion in cl 3(2) is as broad as can be. Having directed, under cl 3(1) the office holders and groups who “shall be” consulted, subcl (2) goes on to say that “a local authority may consult anyone else …”.
18 Enterprise Miramar Peninsula Inc v Wellington City Council [2018] NZCA 541 [2019] 2 NZLR 501 at [77].
(b)The point at which consultation takes place is “… during the preparation of a proposed … plan”.19 In other words, the Council is not consulting before it prepares a plan. So it is not looking for views on whether it should begin a plan change process. And it is not consulting at the end of the process. Therefore, it is not looking for views on final proposals or provisions. It is consulting while it is considering what the proposed changes might be.
(c)The subject matter is a potential new set of provisions and parameters for the development of land; rather than a decision on a particular land use. It is at a relatively high level. Accordingly, while a broad range of people may be affected, not everyone who might be affected in some way by the proposals need be consulted.
(d)When the preparation process for the proposed plan is completed, it will be publicly notified. At this point, any person may make a submission under cl 6 of sch 1of the RMA and substantive hearings will be held under cl 8B. It would be unduly cumbersome if consultation was required on particular proposed plan provisions at the formative stages of the plan change process as well.
[47] With these considerations in mind, consultation under cl 3(2) may be limited to those who are likely to be most affected by the changes that are being considered and otherwise to representatives of people or groupings who may more broadly be affected.
[48] Those people should be provided with sufficient information to enable them to make relevant, useful and intelligent responses. They need not have chapter and verse but they should understand the considerations and the type of material the Council will be taking into account as it prepares a proposed plan change. And they should be given a sufficient opportunity to present their views to the people who will exercise the statutory power; people whose minds must be receptive to alternative views.20
19 Schedule 1, cl 3(1).
20 Enterprise Miramar Peninsula Inc v Wellington City Council, above n 16.
[49] It is sufficiently clear that, under cl 3(2), the Council needed to consult with the applicants on PCG. For CTS, 32 per cent of its title is within the area that is being rezoned. For Terra Civil, the figure is 76 per cent. Woodgate, as mentioned, has an equitable interest in TCL’s land.
[50] Mr Fugle has said in evidence that the business zone overlay, which forms a part of PCG, would see the potential loss of between 16 and 27 lots (depending on the final layout) with an average expected gross return of approximately $350,000 to
$400,000 per lot if an average lot size is used. Woodgate has, Mr Fugle has said, spent more than $100,000 in preparing and advancing the retirement village application.
[51] With that context and framework in mind, major landowners whose land fell within the area covered by PCG needed to be consulted. The individuals from the applicants who needed to be involved in the consultation and the material with which they should have been provided to comment upon are the next questions.
Second issue – did the Council consult with people who represented sufficiently the interests of the applicants?
[52] It is said for the applicants that consultation on the part of the Council with Mr Fugle was inadequate. It is said that, while Woodgate is the beneficial owner of the CTS land, the Council needed to consult with CTS separately. Further, although Terra Civil was project-managing the retirement village process, it has a separate adjacent land holding and needed to be consulted separately.
[53] In order to consider the allegations, it is necessary to set out the consultation process undertaken by the Council, first, at a broad level and, secondly, with the applicants through Mr Fugle. At a broad level, the Council’s consultation process may be summarised in the following way:
(a)Between 2018 and 2019, the Council engaged with the three landowners who own the developable land within Aokautere at various times. Maps in the master plan report from the Council’s urban designer that accompanies the s 32 report on PCG show the three land areas and describe them as “Fugle Interests”, “Green Interests” and
“Waters Interests”. The planner for the applicants, Paul Thomas, refers also to the applicants’ land holdings, with reference to these maps, as the “Fugle interests”.
(b)The Council engaged with key stakeholders including Horizons Regional Council and Waka Kotahi in 2019 over a range of issues including water management, biodiversity, housing density, public transport and road transport.
(c)In August 2019, the Council held a ‘drop in session’ on the proposed structure plan and Plan Change attended by 65 people who discussed a broad range of issues.
(d)During 2020, the Council liaised further with the Regional Council over matters including landscaping, geotechnical hazards, gully protection, water quality and biodiversity. It liaised with the owners of the land referred to in (a) above as the “Green Interests” and the “Waters Interests” over issues relating to their land. The Council received a cultural impact assessment from Rangitāne o Manawatū following a range of hui.
(e)During 2021, the Council consulted with Waka Kotahi about State Highway 57, with the Regional Council about the stormwater and management of the gullies and with Rangitāne o Manawatū over issues including restoration works, affordable housing, stormwater impact on gully systems and archaeological matters.
(f)Between 2021 and 2022, the Council consulted with the three landowners on specific issues. The s 32 report on landowner consultation during this time included the following:
One landowner has also raised the possibility of a retirement village locating within the Residential zone, near the proposed local business zone and on land that was proposed to accommodate medium density development under the structure plan.
Council has engaged with the landowner over whether a retirement village could be incorporated into the plan change without
compromising underlying principles/outcomes sought for the plan change. …
(g)The Council’s “record of consultation” includes entries to the effect that Mr Green was supportive of the Council’s approach for the land to be zoned quickly and that Mr Waters was supportive of the proposed plan change and had no immediate plans to develop. Mr Fugle was recorded as being supportive of the land being zoned to enable further development but as being unsupportive of structure planning, the intended protection of the gullies from development and the provision of a local business centre. It recorded also Mr Fugle’s intention to build a retirement village near the proposed business zone and noted that the Council is “committed to work with Fugel [sic] to see whether a retirement village could be incorporated into the Plan Change. Meeting with Fugels’ [sic] technical experts was undertaken in April 2022.”
[54] The Council’s interactions with Mr Fugle in particular may be summarised as follows:
(a)On 31 July 2018, Mr Fugle, a consultant surveyor engaged by Mr Fugle and two Council officers met as part of what the consultation notes describe as being “clause 3 consultation”.21 Mr Fugle was described as the “company representative”. The structure plan, which sits behind PCG, was discussed in broad terms.
(b)On 20 September 2019, Mr Fugle and two Council officers met and Mr Fugle provided further feedback on the structure plan, addressing the northern gully crossing, road alignment, roading patterns, the number of roads, the need for a structure plan at all, the workability of the proposed commercial area and the need for flexibility.
(c)In 2020, the Council corresponded with Mr Fugle over a particular roading connection.
21 The meeting notes are titled “Feedback on preliminary Aokautere Structure Plan”.
(d)On 27 January 2022, the Council gave Mr Thomas, the planner for all three applicants,22 the then latest version of the structure plan. On 28 January 2022, Mr Thomas was given a copy of the “Draft Master Plan Design Report” and a “Draft Precinct Plan” for the neighbourhood centre proposed in PCG and which would impact the retirement village proposal. A PowerPoint presentation of PCG was provided at the same time which included a description of the goals of PCG, the latest iteration of the structure plan and what the proposed PCG would include. It noted, in particular, the objectives, policies, rules and maps in the District Plan that would be changed and presented different options for the structure plan and for the incorporation of the applicants’ proposed retirement village within the structure plan.
(e)On 24 February 2022, Mr Dunidam sought a meeting with Mr Fugle and Mr Thomas to discuss the proposed plan change, the inclusion of the retirement village and any other developments on the land.
(f)The meeting between Mr Fugle, Mr Thomas and Mr Dunidam took place online on 2 March 2022. Technical information and development plans for the retirement village were discussed. Mr Thomas, in his affidavit, has said that the primary reason for this meeting was to enable the Council to explain its conclusion that substantial upgrades were required to road intersections before any further development could take place on the land.
(g)In an email exchange between Mr Fugle and Mr Dunidam following the meeting on 2 March, Mr Fugle expressed his appreciation for the Council having shared a report it was sending to the Council on the plan change and expressed his concerns about road alignment, the community centre and the gullies. He expressed concerns about the way in which “wider roading issues” might delay the retirement village project, requesting that these points be raised at a meeting with the
22 As confirmed by him in the submission for the applicants on PCG.
mayor. In a response on the same day, Mr Dunidam noted the points and indicated that they would be passed on to the mayor.
(h)On 21 March 2022, Mr Thomas, for the applicants, emailed Mr Burns
– an urban design expert engaged by the Council – asking for his thoughts on “the retirement village concept for Aokautere vis a vis the structure plan and how the two can best work together”. Mr Thomas asked for a telephone conversation.
(i)On 5 April 2022, a team of people for the Council and a team of people for the applicants met to discuss ways in which the retirement village proposal could work with PCG. The Council team comprised Mr Dunidam, Mr Burns, another member of Mr Burns’ consultancy, and a member of the law firm instructed by the Council. The applicants’ team comprised Mr Thomas, an urban design consultant, a landscape consultant and an architectural planning consultant. A set of drawings were sent by Mr Burns to the meeting attendees later in the day and a further meeting was arranged. The drawings provided four options for ways in which the retirement village could be incorporated within PCG.
[55] It is sufficiently clear that the Council consulted with all of the applicants. While, in the earlier stages, it did so with Mr Fugle, the Council regarded Mr Fugle as being a representative of each of the applicants. It expressed that to be the case in its consultation notes, in the s 32 report and in the maps, referred to in [53(a)] above, which associate Mr Fugle’s name with the applicants, collectively.
[56] It was reasonable for the Council to proceed on that basis. First of all, consultation is a two-way street. The Council engaged with Mr Fugle on the basis that he was the right person to consult with on the “Fugle interests” land. If Mr Fugle wished to include others within discussions, he could have done so. That is what occurred later in the process when expert planners, architects and urban designers were included by Mr Fugle in discussions with the Council. Mr Thomas proceeded on that basis too – preparing a joint submission on PCG for all applicants collectively. And,
as Mr Fugle has said in his affidavit, it is Woodgate which alone spent the $100,000 in preparing and advancing the retirement village application.
[57] For these reasons, the Council did, in my view, consult with people who represented sufficiently the interests of the applicants.
Third issue – was sufficient information provided to the people with whom the Council consulted?
[58] For the applicants it is said that the extent of information given to Woodgate, through Mr Fugle and Mr Thomas before notification of PCG, was not sufficient to enable them to formulate and present views on the proposal. It is said in the applicants’ submissions that, while they were provided with certain documents, they were:
not provided with the opportunity to review and address the granular details proposed to be implemented by PCG, to whit the proposed draft rules, and implementation level requirements pertaining to the proposed [retirement village] development.
[59] The short point is that the applicants were not provided with the actual PCG provisions during the consultation process because they had not at that point in time been prepared. There may well have been various drafts under development but, as discussed in [46(c)] and [47] above, consultation at the cl 3(2) phase is at a relatively high level. It is to be conducted “during the preparation” of a proposed plan.
[60] The applicants were provided with different iterations of the structure plan as it was being prepared, with a copy of the underlying master plan, the supporting information used in the August 2019 public consultation, a copy of the master plan design report, the draft precinct plan for the proposed neighbourhood centre and a PowerPoint presentation addressing details within PCG. Mr Fugle, on behalf of the applicants, was able to express his views on a broad range of issues, as mentioned in
[54] above. Detailed engagement took place between experts engaged by Mr Fugle and Council members and experts engaged by the Council over the incorporation of the retirement village proposal into PCG. The Council, as a result of these engagements, made material amendments to the structure plan through the inclusion of the retirement village option, just as had been sought by the applicants.
[61] This amounted, in my view, to the provision of sufficient information to enable the applicants to understand the matters that the Council was taking into account “during the preparation” of the proposed plan and to enable the applicants to make relevant and intelligent responses.
[62] Mr Dunidam has said that Mr Fugle was consulted more than any other person during the PCG process, that the consultation with him resulted in significant changes to the PCG prior notification and that the discussions were not at a high level but focused on the structure plan as the most critical part of the PCG framework.
[63] If further detail needed to be provided at the cl 3(2) stage – whether through the provision of draft plan change provisions or more granular information as the applicants have suggested – then consultation on the development of a proposed plan would come close to replicating the submission and hearing process that is prescribed through sch 1 of the RMA once the plan change is notified. It would be difficult to know where to draw the line; whether different iterations of draft provisions or supporting papers needed to be consulted on separately and where the process should begin or end.
[64] That is not to say that draft plan change provisions need never be provided during consultation at the cl 3(2) stage. There may be cases where, with a more confined plan change proposed, it would be appropriate to do so. But, on the basis that has been discussed, that was neither necessary nor appropriate on the facts of this case.
[65] Moreover, the points that have been addressed by the applicants in this proceeding – including their view that the development of PCG should have been a joint process through which the Council worked in partnership with landowners – are addressed in the applicants’ submissions on PCG and will be addressed on the oral submissions the applicants will make on PCG later in the year.
[66] The hearing commissioners (who are to be appointed by the Council) will be able to consider and address the PCG provisions with which the applicants have concerns.23
[67] For these reasons, the Council did in my view provide sufficient information to the people with whom it consulted under cl 3(2).
Fourth issue – have the applicants been given notice of the s 86D application?
[68] For the applicants, it is said that consultation was undertaken “in form only” as the Council had determined already that it would seek to bring the PCG provisions into immediate effect under s 86D of the RMA.
[69] There is no evidence of any such determination on the part of the Council and, as discussed in [23] above, the s 86D process must by its very nature in most cases proceed on an ex parte basis.
[70] There was no error in the Council’s approach to the application it made under s 86D and the applicants chose not to challenge the Environment Court’s decision. They would have had standing to bring a judicial review proceeding if they felt that the Environment Court erred in proceeding ex parte or in the basis upon which its decision was made.24 This point leads on directly to the next issue in the proceeding.
Fifth issue – is the relief sought by the applicants available to them?
[71] As I have found that there was no flaw in consultation undertaken by the Council on PCG it is not strictly necessary to address this issue. However, had I found there to have been a flaw, it would not have been appropriate for the Court to grant the first prayer for relief in the applicants’ statement of claim. That prayer for relief seeks that “the determination of the Environment Court is quashed”. The Court could only
23 The fact that expert decision-makers under the RMA are best placed to consider substantive disputes during a RMA process is a point emphasised by the Court in Red Hill Properties Limited v Papakura District Council (2000) 6 ELRNZ 157 (HC) as adopted and applied in Graham v Auckland Council [2013] NZHC 833, [2013] NZAR 696 at [50]–[62].
24 On the basis that the applicants’ rights may be impacted by the decision. See Judicial Review Procedure Act 2016, ss 4 and 5. The common law judicial review principles are relevant also.
grant relief of that sort if the decision of the Environment Court itself was in issue and if a flaw had been found in that Court’s process.
[72] It is certainly the case that, in the event that a cause of action is made out in a judicial review proceeding, relief should follow and it should be effective.25 However, quashing, or directing reconsideration of, a decision that is subject to a flaw and quashing a subsequent decision of a Court are very different matters. Accordingly, the relief sought under this head was not available to the applicants. That point, in turn, leads to the next.
Sixth issue – had a ground of review been made out, should the Court have exercised its discretion to grant relief?
[73] Because the Environment Court decision cannot be set aside in this proceeding, then this Court cannot, either legally or practically, go back a step further and effectively set aside, or stay, notification of PCG. That would, as the Council says, undermine the Environment Court decision that followed. It would necessitate a ‘restart’ of the sch 1 process when it is past half way through. And it would cause prejudice to third parties: the submitters and further submitters on the Plan Change whose work on submissions, including through the engagement of experts, would need to be put to one side and reframed in the future.
[74] Moreover, the plaintiff has not been unduly prejudiced. As mentioned in [21], a full plan change process under schedule 1 of the RMA is underway. The applicants have filed substantive submissions on the plan change as a part of that process. Their submissions will be considered by independent commissioners at a public hearing.26 Should they not be satisfied with the decision of the commissioners, they would have a right of appeal to the Environment Court; an appeal that is heard de novo.27
[75] For these reasons, had a flaw in the Council’s consultation process been found, it would not have been appropriate for the Court to have exercised its discretion and to grant relief.
25 Air Nelson Limited v Minister of Transport [2008] NZAR 139 at [61].
26 Schedule 1, cl 10 of the RMA. And see Trustpower Ltd v Electricity Authority [2017] 2 NZLR 253 (HC) at [100]–[107]; and Deliu v New Zealand Law Society [2015] NZCA 12 at [25].
27 Schedule 1, cl 14, and s 290 of the RMA.
Result
[76]The application for judicial review is declined.
[77] If costs are sought and cannot be resolved between the parties, then the respondent may, within 10 working days from the date of this decision, file a memorandum and the applicants may, within a further 10 working days, file a memorandum in response. Any such memoranda, including schedules, should be limited to five pages in length.
Radich J
Solicitors:
Dewhirst Law, Palmerston North for Plaintiffs Cooper Rapley, Palmerston North for Defendant
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