Gibbs v First Gas Limited
[2022] NZCA 627
•15 December 2022 at 9.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA |
| CA29/2022 [2022] NZCA 627 |
| BETWEEN | RUSSELL VICTOR GIBBS, PARANI JOSEPHINE GIBBS AND TE AHURU TRUSTEE COMPANY LIMITED AS TRUSTEES OF THE RV AND PJ GIBBS FAMILY TRUST |
| AND | FIRST GAS LIMITED |
| Hearing: | 25 October 2022 |
Court: | Collins, Thomas and Muir JJ |
Counsel: | Appellants in person |
Judgment: | 15 December 2022 at 9.30 am |
JUDGMENT OF THE COURT
AThe appeal is dismissed.
BThe appellants must pay costs to the respondent for a standard appeal on a Band A basis and usual disbursements.
____________________________________________________________________
REASONS OF THE COURT
(Given by Muir J)
Introduction
The trustees of the RV & PJ Gibbs Family Trust (the Trustees) appeal a decision of Grice J, dated 3 December 2021,[1] in which her Honour made declarations that First Gas Ltd (First Gas) be authorised to enter onto the Trustees’ land with machinery as required for the purposes of inspecting and repairing the Maui Gas Pipeline (Maui Pipeline) and to store and deposit such machinery adjacent to the pipeline while such works were occurring. Her Honour also issued a permanent injunction prohibiting the Trustees from restricting First Gas in the exercise of its rights.[2]
[1]First Gas Ltd v Gibbs [2021] NZHC 3309 [Judgment of Grice J].
[2]At [278].
Broadly, the Trustees say that these rights are restricted to a 12 metre wide strip, six metres either side of the pipe’s centreline and, since vehicular access along the length of the strip is not possible, any access across their land for maintenance purposes must be the subject of negotiation and agreement.
The respondents say that Grice J correctly interpreted the relevant easements and applied the relevant statutory framework with the result that the appeal should be dismissed with costs.
Background
First Gas owns and operates the Maui Pipeline. It was formerly known as Vector Gas Ltd and formerly still as Natural Gas Corporation of New Zealand Ltd (NGC). NGC was one of the companies employed by the Minister of Works and Development to operate the Maui Pipeline which was developed and originally owned by Maui Development Ltd (MDL). First Gas purchased MDL in June 2016. It is therefore now both the owner and operator of the pipeline.
The pipeline itself was completed in 1979 and supplies over 90 per cent of the natural gas used in the upper North Island. It runs 299 kilometres northward from New Plymouth to South Auckland, mostly underground at a depth of 1.2 to 1.5 metres. The Trustees’ picturesque coastal property, owned by them and their predecessors for over 100 years, is one of those through which it passes. The relevant legal authority derives from a pipeline authorisation under the Petroleum Act 1937 (the Act),[3] dated 31 July 1975, and two pipeline easement certificates (PECs) issued under it.[4]
[3]The Petroleum Act 1937 has been repealed but the saving provisions in the Crown Minerals Act 1991 preserve the former’s statutory provisions for authorisations granted under pt 2 of the Act. Clause 12(1) of the saving provisions in sch 1 to the Crown Minerals Act provides that the holder of an “existing privilege” (which includes an authorisation granted under pt 2 of the Act) has the same statutory rights as it would have had if the Crown Minerals Act and the Resource Management Act 1991 (RMA) had not been enacted, unless “any consent in respect of the privilege would, but for this subclause, be required and need to be sought under the [RMA]”, in which case the RMA applies. Section 70A was inserted into pt 2 of the Act by the Petroleum Amendment Act 1974 on 8 November 1974. Part 2 was then entirely repealed and replaced by the Petroleum Amendment Act (No 2) 1980. In the newly substituted pt 2, the former s 70A was largely replicated in s 71. On 16 December 1982, s 71 was then repealed and replaced with ss 71, 71A and 71B by the Petroleum Amendment Act 1982. It is this version of ss 71–71B which remains in force under the Crown Minerals Act.
[4]The PECs are dated 28 March 1980 and were registered against the relevant titles on 21 July 1980.
The PECs apply to different parts of the Trustees’ property but are essentially in the same form. Both were issued under s 70A of the Act[5] which provided that after any pipeline authorisation had been granted, the Governor-General could issue a proclamation defining the middle line of the pipeline and that, as soon as practicable after construction was completed, the pipeline’s owner was to undertake a survey of the actual position of the pipeline “showing the strip of land not exceeding 20 metres in width under, upon, or over which the pipeline passes”,[6] and to submit this to the relevant Minister who was to issue “to that owner such pipeline easement certificates as may be necessary in the prescribed form”.[7]
[5]A pipeline authorised under s 70A was, by the operation of s 70A(12), deemed to be issued under s 70. Section 70 (as amended by the Petroleum Amendment Act 1988) remains in force under the Crown Mineral Act saving provisions.
[6]Section 70A(10).
[7]Section 70A(11).
Both PECs identify the easement holders as MDL (as owner of the Maui Pipeline) and NGC (as the pipeline’s operator). Relevantly, they further provide:
… the Minister of Energy hereby certifies that a pipeline(x) (as defined in Section 49 of the Act) is authorised to pass on, over or through the land described in the Schedule herein (in this certificate referred to as the said land) upon the following terms and conditions:
…
3.The pipeline(x) has been placed along the line(x) delineated on the plan annexed hereto marked, “Maui Pipeline[”].[8]
4.Upon the issue of this certificate the easement holders shall have the right of entry on the said land pursuant to sub-section (6) of section 70 of the Act for the purpose of exercising the rights conferred on them by the Act and any regulations made thereunder and by the pipeline authorisation.
5.For the purposes of subsection (11) of Section 70A of the Act, this certificate shall apply to the strip of land shown on the said plan and not exceeding 20 metres in width under, upon or over which the pipeline(x) pass(es) (in this certificate referred to as the said strip) and each of the easement holders shall have the right from time to time after the issue hereof to remove from the said strip all cultivated or natural vegetation including trees and shrubs.
6.The owner or occupier of the said land shall have the right to use it (except for such use as may be reasonably held to interfere with the enjoyment of the rights of any of the parties interested in the pipeline(x) hereunder or under the Act or under the pipeline authorisation) but shall not erect any building, construction, or fence or plant any tree or shrub on the said strip, disturb the soil of the said strip below a depth of 0.4 metre from the surface or do, cause or permit anything to be done which would or could damage or endanger the pipeline(x) without the consent of the operator(x) of the pipeline(x) being first obtained. Any such consent shall not be unreasonably withheld.
…
8.Where the pipeline(x) is below the surface of the ground, it is buried so that it will not interfere with the ordinary cultivation of the said land and in maintaining, repairing, renewing, changing or removing the pipeline(x) the pipeline operator(x) shall restore the surface of the said land, as nearly as possible, to its former condition or state.
9.Such of the rights, easements, or obligations hereinbefore recited or referred to which place a burden on the said land or on the owner or occupier of the said land shall be binding on him the said owner or occupier his or their successors, executors, administrators, and assigns and such of them as place a burden on any of the easement holders shall be binding on them, their successors, executors, administrators and assigns.
[8]This is the description in PEC 269143. In PEC 269148 the reference is to “Gas Pipeline Maui”.
The lands through which the pipeline passes are identified in schedules to the PECs and attached are Survey Office plans (11320 and 11042 respectively) showing the pipeline course. These plans describe the land in the two schedules as “the servient tenements”. In the top right appears a “Diagram of Easement” showing a 12 metre corridor, 6 metres either side of the “Maui Gas Pipeline Centreline”.
In 2018 a serious defect was identified in a five metre section of the pipeline within the boundary of the Trustees’ property. The defect was likely caused by earth movement and placed the pipeline at risk of failure. A remediation programme, named the “Pariroa Project”, was settled involving, as a first phase, construction of a bypass pipeline and, as a second phase, replacement of the damaged section and reconnection of the gas supply. The bypass pipeline ran for 800 metres above ground, outside the 12 metre strip of land identified in the PECs and was the subject of separate negotiations between First Gas and the Trustees.
However when in January 2021, First Gas tried to obtain access through the Trustees’ land to commence the second phase of the remediation, it was blocked from doing so by the Trustees. The Trustees said access would not be permitted other than on various terms and conditions which the parties were unable to agree.
On 16 April 2021, First Gas filed proceedings which included an application for an interim injunction preventing the Trustees from restricting access for repair purposes. This was granted by Isac J on 9 July 2021.[9] First Gas planned to commence preliminary investigative work and notified the Trustees accordingly on 26 July 2021. However, when its personnel and a surveyor arrived, each was served with a trespass notice. The Trustees also blocked access down a track, used by First Gas and its predecessors for almost 40 years, with two vehicles.
[9]First Gas Ltd v Gibbs [2021] NZHC 1722.
Eventually, the Trustees relented but, in evidence before Grice J, Mr Gibbs was clear that this was only on account of the interim orders and that the trespass notices against First Gas personnel otherwise remained in force. He maintained the position that the Trustees were necessarily involved in all decisions relating to the pipeline (including whether to repair the damaged section at all) and, in that context, required access to all plans, including engineering drawings, and to attend all planning meetings.
These events played out against a long history of disputes between the Trustees, First Gas and its predecessors. Issues have also arisen in relation to a smaller natural gas pipeline running over their land known as the Kapuni Pipeline.
The High Court decision
Grice J identified three central issues in the proceedings and her conclusions in respect of each are conveniently collated in her judgment as follows:[10]
[10]Judgment of Grice J, above n 1, at [259] (footnotes omitted).
(a)Is First Gas only permitted to use land within the 12-metre strip delineated on the PEC as the pipeline corridor when it is repairing the pipeline (and carrying out other authorised works) and for entry and egress, storage and deposit of machinery and equipment and depositing spoil incidental to those works?
(i)Answer
First Gas is entitled to access and use the land legally described in the schedules to the PECs for the purposes specified under the Petroleum Act, including the repair of the pipeline, access to achieve that repair and incidental actions, as well as storage and deposit of spoil. Those rights are not limited to the 12-metre strip of the pipeline corridors delineated in the diagrams attached to the PECs.
(b)Is there an arrangement or agreement for a “collaborative process” or conditions for the use of land described in the PECs that binds First Gas for the purposes of undertaking the Pariroa Project Phase 2 repairs or other authorised works on or to the pipeline by virtue of:
a.The 2009 Court decision in Gibbs v Vector Gas and/or
b.Previous dealings and agreements?
(i) Answer
There is no arrangement or agreement applying to future works including the Pariroa Project Phase 2, by virtue of the 2009 court decision, nor as a result of previous dealings and agreements between the Gibbs’ and First Gas (or its predecessors).
(ii) Answer
First Gas’ rights and powers are not conditional on its working with, or in consultation with, the landowners.
(c)Are there legislative and other requirements or interests including under the RMA and health and safety legislation and/or rights and interests flowing from the Gibbs’/Poutama’s kaitiakitanga over the land which affect First Gas’ rights of access and use of the land for the purposes repairing or carrying out other authorised works on the pipeline?
(i)Answer
First Gas has the absolute right to carry out the repairs and other authorised works on the pipeline and for that purpose has the power to enter and use the land.
(ii)Separately, First Gas must observe any statutory obligations affecting their work on the pipeline and incidental to it, including the RMA and health and safety legislation and requirements concerning artefacts and cultural requirements. Those obligations are separate from and do not affect the rights and powers set out above.
(iii)The issues relating to the Gibbs’/Poutama’s kaitiakitanga over the land and Poutama’s claim to mana whenua do not affect the issues under consideration in this proceeding as outlined above.
(footnotes omitted)
Her Honour made declarations accordingly and issued a permanent injunction prohibiting the Trustees from restricting, obstructing or otherwise interfering with First Gas’ access rights.[11] In doing so she noted that there was nothing in its conduct that disentitled it to the relief sought, that it had made attempts to work collaboratively with the Trustees but that these had not been successful and that the relationship between the parties had broken down with the Trustees actively attempting to disrupt First Gas from undertaking the required repairs.[12]
Issues on appeal
[11]At [278].
[12]At [272].
Three issues emerge from the Trustees’ notice of appeal and submissions, namely, whether the High Court erred in:
(a)finding that First Gas’ rights are not limited to the 12-metre wide easement strip;
(b)finding that First Gas’ rights are not subject to any binding arrangement or agreement; or
(c)ordering a permanent injunction.
Discussion
Issue 1: Did the High Court err in finding that First Gas’ rights are not limited to the 12-metre wide easement strip?
The Trustees argue that Grice J failed to ask and answer a threshold question — “exactly what land has been taken”. They say that her Honour “wrongly applied the PEC[s] to an additional area of land that has never been taken”, contrary to s 70(3) of the Act. They also say that the powers granted to First Gas under s 68 of the Act and the rights of entry onto land and storage of equipment recognised in s 75 are limited by s 71 (in a former iteration, s 70A) of the Act. Accordingly, they say that such rights can only be exercised within the 12 metre easement strip unless a further agreement is reached pursuant to s 69 of the Act or additional land is taken under s 78 of the Act.
We are unpersuaded by these arguments. We reach that conclusion having regard to the clear terms of the PECs and the statutory framework in which they sit.
We start with the PECs themselves. They define the several blocks of land referred to in their schedules (through each of which the pipeline passes) as “the said land”. Clause 9 acknowledges the said land is subject to a “burden” as defined in the easement.
Clause 4 is in unequivocal terms. It provides that the easement holders “shall have the right of entry on the said land pursuant to subsection (6) of section 70 of the Act for the purpose of exercising the rights conferred on them by the Act … and by the pipeline authorisation”.
Section 70(6) is in equally clear terms:
70 Pipeline easement certificates
…
(6)The effect of every pipeline easement certificate shall be to give the holder of the authorisation or his authorised agent a right of entry on the land to which the certificate relates for the purpose of exercising the rights conferred on him by this Part of this Act and by his authorisation.
(emphasis added)
The Part of the Act referred to includes s 68:
68 Powers of holders
Notwithstanding the provisions of any other Act, regulation, bylaw, certificate of title, or other authority, any pipeline authorisation issued under this Part of this Act shall, subject to the provisions of this Part of this Act and of the authorisation, confer on the holder, while the authorisation remains in force, an absolute right—
(a)To construct and lay pipelines on, over, or under any land referred to in the authorisation:
(b)To construct and lay pipelines along, on, over, or under any road, railway, tramway, bridge, navigable waters, river, or stream referred to in the authorisation:
(c)To alter, remove, repair, operate, inspect, renew, and maintain any pipeline constructed under the authority of the authorisation:
(d)To do such other things as are necessarily incidental to the exercise of the powers and authorities of the holder under this Part of this Act.
(emphasis added)
In the result, First Gas has a right of entry on the land to which the certificate relates for the purposes of, inter alia, inspecting, renewing and maintaining its pipeline. The “land to which the certificate relates” is a reference to the various parcels identified by the Certificate of Title, volume and folio in the schedules to the PECs. That is confirmed by s 70(2) which, at the time the relevant PECs were issued, stated that “[e]very such [PEC] shall be accompanied by a diagram showing the actual line of the pipeline on the land to which the certificate relates”.
The scheme of the Act is to differentiate between the “land to which the certificate relates” (corresponding to the definition of “the said land” in the PECs) and the “strip of land” being the corridor through which the actual pipeline passes.
The latter is referred to in s 70(3) which provides that:
(3)Every such [PEC] shall apply to a strip of land over, upon, or under which the pipeline is laid not exceeding 20 metres in width …
Likewise, cl 5 of the PECs refers to a strip of land not exceeding 20 metres in width “under, upon or over which the pipeline(x) pass(es)” and authorises the easement holders to remove all cultivated or natural vegetation within that area.
But the easement holders’ rights are not simply confined to the strip, as any such interpretation would be in direct conflict with cl 4 of the PECs and s 70(6) of the Act. The “strip of land” which defines the limits within which the pipeline can be lawfully constructed, and which has its own set of restrictions in terms of landowner use, exists effectively as a subset within the wider easement which itself permits entry on and access across the land to “which the certificate relates”.
Section 75 affirms that position and sets out the predictable notification requirements in the event of intended entry onto the servient lands. Relevantly, it provides:
75 Entry on land for purpose of exercising rights in authorisation
(1)For the purpose of exercising any right conferred on him by his authorisation or by this Part of this Act, the holder of the authorisation may enter upon such land as may be necessary for the exercise of any such right, with right of access to and egress from any such land with his servants, workmen, and agents, from time to time and at all times, with or without any suitable or available means of conveyance, and with all such equipment, articles, and materials as may be necessary for the carrying out of any works authorised by the authorisation or authorised by this Part of this Act to be carried out by the holder, and may also deposit and store from time to time upon any land adjoining any such works all such machinery and material of any kind as may be used in carrying out any such works.
(2)Entry shall not be made on any land under this section unless—
(a)A Proclamation has been issued under section 71 of this Act in respect of the land; or
(b)The holder of the authorisation has in respect of the land either—
(i)Entered into an agreement under section 69(1)(b) of this Act; or
(ii)Obtained a pipeline easement certificate under section 70 of this Act.
(2)Before entry under this section is made on any land to which subsection (2) of this section does not apply,[13] the holder shall where possible give 21 days’ notice to the owner or occupier of the land, and to any local authority having the control or management of the land, of his intention to enter thereon.
…
[13]The phrase “subsection (2) of this section does not apply” was substituted with “subsection (2)(a) of this section applies” pursuant to s 19(2) of the Petroleum Amendment Act 1982.
It is this provision which provided the statutory authority for that part of Grice J’s order permitting the deposit and storage of machinery upon land adjoining the pipeline during the repair period.
The Trustees suggest that all such powers must be read subject to the former s 70A, now, with amendments, s 71. As indicated, this provides for the Governor-General to make a middle line proclamation. Section 70A(2) provided:[14]
(2)Every Proclamation under this section shall define, by reference either to the distance on each side of the middle line or to the more distant section boundaries, or by reference to both, such land within 100 metres from the middle line upon or in respect of which it is intended to exercise the powers conferred by this Act or any other Act in respect of the construction, maintenance, and use of the pipeline:
Provided that, in placing the pipeline in its final position, construction work (including the provision of access for vehicles and plant) shall be confined to a strip of land—
(a)Not more than 30 metres wide; or
(b)Of such greater width as the Secretary (after consultation, if practicable, with the occupier of the land) may allow in any particular case owing to special circumstances—
within the strip of land defined in the Proclamation.
[14]Section 70A(2) is replicated in substantively identical terms in s 71(3) and (4) (see Petroleum Amendment Act 1982).
The Trustees argue that because a middle line proclamation defines land in respect of which it is intended to exercise construction and maintenance powers, it is only within the designated distance of the middle line that s 68 powers may be exercised. We do not accept that interpretation. Section 70A(2) says nothing about access to the area required for construction or maintenance. Moreover, the middle line proclamations relating to the Trustees’ various titles were superseded by PECs as provided for in s 70A(10) and (11)[15] and there are now no proclamations registered against them. As a result, even on the Trustees’ interpretation of s 70A(2), that section is not determinative. And, as previously noted, s 70A(12)[16] deemed every PEC issued, under subs (11) to have been issued under s 70 of the Act, thus invoking the “right of entry” provisions contained in s 70(6) and cross-referenced in cl 4 of the PECs. It is the PECs, together with ss 68, 70(6) and 75 which now provide the contractual and statutory framework within which First Gas’ access and storage rights are properly assessed.
[15]Section 70A(10) has no equivalent provision in s 71. However, it appears to have been replicated, albeit with some changes, in s 72 (see Petroleum Amendment Act 1982).
[16]The equivalent to the former s 70A(12) is s 71(9) (see Petroleum Amendment Act 1982).
Nor do we accept the Trustees’ argument that only as a result of a new easement under s 69(1)(b) or as a result of a taking under s 78 could rights be asserted outside the 12 metre wide “strip” identified in the PECs. Although these provisions provide a mechanism for the acquisition of additional rights, as for example, if a new pumping station was required to be established outside of the strip, the sections do not operate to limit or interfere with the rights and interests acquired under any existing easement. In particular, they do not limit First Gas’ access rights to the 12 metre strip, nor its rights under s 75 of the Act, and it is not necessary for land to be “taken” for First Gas to exercise those rights.
We have come to the conclusions expressed above based on ordinary principles of statutory[17] and contractual[18] interpretation. We are unpersuaded that recourse to Hansard is necessary to interpret what we regard as a relatively straightforward statutory framework. However, we have reviewed those passages which the Trustees have referred us to[19] and identify nothing in them which meaningfully supports any alternative construction.
[17]Considering the ordinary meaning of the words used, the context in which they have been used, the purpose of the enactment and the avoidance of manifest absurdity or injustice.
[18]In our view the PECs are in clear terms. Accordingly, recourse to extrinsic evidence has been unnecessary in the interpretive exercise. In any event we note that the extent to which such recourse is permitted in the interpretation of instruments notified on a public register is not entirely settled (see Green Growth No 2 Ltd v Queen Elizabeth the Second National Trust [2018] NZSC 75, [2019] 1 NZLR 161 at [133], [158] and [161] in which a majority of the Supreme Court left the issue open).
[19]Including (9 November 1962) 332 NZPD 2567–2568; (13 December 1962) 333 NZPD 3398–3401; (22 September 1967) 353 NZPD 3221–3225; (4 October 1967) 353 NZPD 3475–3488; (25 October 1967) 353 NZPD 3609–3622; and (6 November 1974) 395 NZPD 5594–5602.
Likewise, we regard the issue of whether First Gas has rights under s 234(1) of the Public Works Act 1981[20] to enter the Trustees’ land, which was the subject of memoranda from the parties after the hearing, as irrelevant to the proper construction of the PECs or the Act, the scheme of which provides for access to ensure preventative maintenance long before the emergency scenarios contemplated in s 234(1).
Issue 2: Did the High Court err in finding that First Gas’ rights are not subject to binding arrangement or agreement?
[20]Which provides for rights of entry on oral notice (as may be practicable in the circumstances) where there is imminent danger to life or property, or a likelihood of serious interference with or damage to any public work from any cause whatever and which requires immediate remedial work.
The Trustees’ argument under this head is now based on an agreement between MDL and Federated Farmers (FF), executed in or around 1974[21] and identified subsequent to delivery of Grice J’s judgment.[22] They say that the rights conferred by the PECs and the Act are subject to this agreement which was referred to in argument as the Maui Pipeline Agreement (MPA).
[21]The exact date is not in evidence. Indeed, it cannot be established with certainty that the agreement was executed prior to the middle line proclamation made under s 70A of the Act which was signed on 6 August 1975.
[22]The Notice of Appeal also refers to a judgment and sealed order in proceedings relating to the Kapuni Pipeline near Mangapukatea (Gibbs v Vector Gas Ltd HC New Plymouth CIV-2008-043-545, 27 April 2009) but the matter was not pursued in argument. For completeness, we record that we do not consider the judgment relevant. The agreement between MDL and FF was admitted on an application to adduce further evidence before this Court: Gibbs v First Gas Ltd [2022] NZCA 414 at [22].
The MPA predated construction of the pipeline and addressed, ostensibly on behalf of all farmers through whose land it passed, issues such as: the width of what it referred to as “the easement” (but which is in effect the pipeline “strip”); arrangements for removal of trees; farm access across the relevant area during construction; the depth at which the pipe was to be laid; ongoing compensation arrangements (“fifty per cent” of the “current ‘paddock value’ of the 12 or 18 metre strip as assessed by the Valuation Department”); and related matters.
The Trustees rely, in particular, on cl A(2) and cl B(18).
2.It is proposed that entry to land for construction purposes will be effected on the basis of a standard easement which provides for payment for the easement itself and makes separate provision for payment for all damage done in the course of laying the pipes if not made good. In entering upon land and carrying on the work specified or carrying out repairs or maintenance or inspecting the pipelines, the Company and/or the Operators shall cause as little disturbance, or disruption to the occupier or the farming operations conducted upon the land, as is possible and shall do or permit as little damage as is reasonably possible to the land or to any improvements on the land or adjacent to the easement and shall restore and repair the land or improvements so damaged, or shall pay compensation in lieu thereof.
…
18. Additional Access
Any access required to the 30 metre construction strip other than along the construction strip itself shall be the subject of separate negotiations.
They note that on the second reading of the Petroleum Amendment Bill (the vehicle by which s 70A came to be introduced into the Act), the Minister of Mines stated that the intended middle line proclamation procedure “in no way overrides detailed arrangements at present being negotiated between the Ministry of Works and Development and Federated Farmers for the use of land for construction of the Maui Pipelines”.[23]
[23](6 November 1974) 395 NZPD 5595.
They say that the MPA is consistent in all respects with their argument that the rights under ss 68 and 75 are subordinated to the former s 70A and may only be exercised outside the 12-metre strip if the subject of further agreement or a s 78 taking. Further, they submit that such result is consistent with the “intent of the Minister of Energy” and representations to the Select Committee on Commerce and Energy on the Petroleum Amendment Bill (No 2) 1980.[24]
[24]The Petroleum Amendment Act (No 2) 1980 repealed s 70A (refer above, n 3).
By contrast, First Gas emphasises that the parties to the MPA were MDL and FF; the only reference to First Gas (by its former name NGC) is in cl A(1) where NGC is described as being “employed” by MDL; MDL is no longer in existence, having been struck off the register; First Gas never acquired MDL, simply its pipeline; and that there is no evidence that the Trustees, or their predecessors, were even members of FF at the time the MPA was executed. Accordingly, First Gas says that it is not bound by the MPA. We agree there is no contractual nexus.
First Gas further emphasises that, in the context of multiple subsequent amendments to the Act, there was ample opportunity for the MPA to have been given legislative imprimatur if that had been what was intended. The reality is that this did not occur.
Its primary argument is, however, that approximately six years after the MPA was entered into, the PECs were granted in favour of, inter alia, NGC. It submits that these superseded the MPA which, apart from a singular reference to repairs and maintenance in cl A(2), was firmly focused on the construction phase,[25] its purpose being to provide a framework prior to the grant of easements which would in the interim define the parties’ rights. It says that “[t]o all intents and purposes, the MPA is therefore spent in respect of the relevant land.”
[25]We note that cl B(18) on which the Trustees particularly rely is specifically directed as access to the “30 metre construction strip”, the clear inference being that this relates to the construction period.
We agree. Section 70A clearly contemplated a process whereby at the conclusion of the construction period, a survey would occur and the issuing of easement certificates would follow. Such certificates were deemed to be issued under s 70 of the Act, subss (2) and (6) of which we have already referred to and which are determinative of the rights of entry which First Gas asserts. In turn, the PECs confirm that position. Compensation has and continues to be paid by reference to the relevant instruments and the statutory context in which they sit. It is not open to the Trustees to attempt qualification of these rights which are pursuant to a registered interest in land by reference to a prior and superseded agreement to which First Gas (or its predecessor) is not even a party.
Issue 3: Did the High Court err in granting a permanent injunction?
The Trustees argue that the permanent injunction granted by Grice J was a “mallet to crush a nut” and that the declarations made by her Honour were a sufficient remedy.
An injunction was sought by First Gas based on what it described as the Trustees’ generally “hostile” attitude and the long and disputatious history between the parties. In this Court it emphasises the physical obstructions to employee and contractor access in January and July 2021, and Mr Gibbs’ evidence before Grice J that, from his perspective, the trespass notices issued in July 2021 remained extant. Indeed, when asked whether, “if any of those people tried to go now, you’ll trespass them”, he responded, “they’ve been trespassed”. As Grice J noted, Mr Gibbs also made it clear that he would not willingly grant First Gas access, nor allow it to exercise its statutory rights without a court order.[26] She observed that “[f]uture denial of access, or access subject to conditions, has been threatened by Mr Gibbs.”[27]
[26]Judgment of Grice J, above n 1, at [263].
[27]At [248].
We agree with the Judge that the history between the parties demonstrates a pattern of unreasonable interference by the Trustees with the rights of First Gas with a significant risk that this will again occur in the future. Accordingly, there is a resulting premium on ensuring that the Trustees are restrained by appropriate court order. This is particularly so given the importance of ensuring that an item of nationally significant infrastructure is properly maintained and operated and that First Gas’ lawful rights are not effectively defeated or derogated from.[28]
[28]As identified by Grice J, above n 1, at [265].
In any event, the Judge’s decision to grant the permanent injunction was within her discretionary powers. There is no basis to suggest that discretion was exercised in a manner which might invite review by this Court.[29]
Result
[29]See Shell (Petroleum Mining) Co Ltd v Todd Petroleum Mining Co Ltd [2007] NZCA 586, [2008] 2 NZLR 418 at [110]–[111].
The appeal is dismissed.
The appellants must pay costs to the respondent for a standard appeal on a Band A basis and usual disbursements.
Solicitors:
Govett Quilliam, New Plymouth for Respondent
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