Hospitality New Zealand, Canterbury Branch v Christchurch City Council
[2017] NZHC 1360
•20 June 2017
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
CIV-2014-409-1165 [2017] NZHC 1360
UNDER THE Judicature Amendment Act 1972 IN THE MATTER
of an application for review of a decision under section 84 of the Sale and Supply of Alcohol Act 2012
BETWEEN
HOSPITALITY NEW ZEALAND, CANTERBURY BRANCH Plaintiff
AND
CHRISTCHURCH CITY COUNCIL Defendant
Hearing: 22 March 2017 Appearances:
J G H Gardner-Hopkins for Plaintiff
P M S McNamara and T R Fischer for DefendantInterim Judgment:
20 June 2017
INTERIM JUDGMENT OF NICHOLAS DAVIDSON J
HOSPITALITY NEW ZEALAND, CANTERBURY BRANCH v CHRISTCHURCH CITY COUNCIL [2017] NZHC 1360 [20 June 2017]
CONTENTS
A INTRODUCTION
B DEVELOPMENT OF A LOCAL ALCOHOL POLICY (“LAP”)
C CRDP AND DECISION 43
D QUESTIONS RAISED ON THIS JUDICIAL REVIEW E DISPOSITION
ABBREVIATIONS
ARLA ……………………. : Alcohol Regulatory and Licensing Authority Council …………………… : Christchurch City Council CRDP…………………….. : Christchurch Replacement District Plan Decision 43 ……………….. : Decision 43 released 20 September 2016. DLAP …………………….. : Draft Local Alcohol Policy
High Street Block ……….... : Lichfield Street, Madras Street, St Asaph Street and Manchester Street
HNZ ……………………… : Hospitality New Zealand, Canterbury Branch
IHP ………………………. : Independent Hearing Panel LAP ……………………… : Local Alcohol Policy LURP ……………………. : Land Use Recovery Plan
North Victoria Street …….. : Victoria Street north of Salisbury Street
(including Carlton Corner)
Officers’ Memorandum …. : Officers’ Memorandum dated
27 September 2016
Order in Council ………… : Order in Council
(the) Working Party ……… : Provisional Local Alcohol Policy AppealsWorking Party
PLAP …………………….. : Provisional Local Alcohol Policy
Reconsideration Decision ... : Reconsideration decision dated 29 September 2016
RMA …………………….. : Resource Management Act 1991
South Victoria Street ……. : Victoria Street south of Salisbury Street
SSAA …………………… : Sale and Supply of Alcohol Act 2012
VNA ……………………. : Victoria Neighbourhood Association
INTRODUCTION
[1] The motivation for this judicial review is the differentiation in the maximum
or “latest” closing time of on-licence premises between the north and south parts of
Victoria Street in Christchurch.“North Victoria Street” and “South
Victoria Street” are delineated at the intersection of Salisbury and Victoria Streets.
[2] The differentiation arose in a decision (the “Reconsideration Decision”) made by the Christchurch City Council (“the Council”) during the development of a Local Alcohol Policy (“LAP”) under the Sale and Supply of Alcohol Act 2012 (“SSAA”). That decision is under appeal by the plaintiff, Hospitality New Zealand, Canterbury Branch (“HNZ”), to the Alcohol Regulatory and Licensing Authority (“ARLA”) and due to be heard later in 2017. This judicial review is a collateral challenge to the Reconsideration Decision.
[3] The Reconsideration Decision provides for a 3:00am maximum closing time for on-licence premises in South Victoria Street, and a transitional 3:00am maximum closing time for North Victoria Street, which will cut back to 1:00am after three years. HNZ says that the 1:00am maximum closing time is unreasonable having regard to the object of the SSAA, and wrongly “splits” Victoria Street.
[4] Mr Gardner-Hopkins, counsel for HNZ, says that the appeal to the ARLA will not suffice for those licensed interests it represents. This judicial review is brought to regularise what is said to be a flawed process by which the Council reached the Reconsideration Decision. HNZ says it should be revisited by the Council, this time correctly having regard to the development of a new District Plan for Christchurch, and in particular a decision made in the course of that development (“Decision 43”) which addressed Victoria Street licensed premises.
[5] This Interim Judgment holds that the Council did not have such regard, and should have, and so too should the ARLA on any appeal which addresses the differentiation, or any other element to which Decision 43 and the new District Plan, proposed or operative, is relevant.
“District Plan”
[6] HNZ says that when making the Reconsideration Decision the Council failed to follow the direction that it “must have regard to … the objectives and policies of the District Plan” under s 78(2) of the SSAA.
[7] HNZ says the “District Plan” for these purposes includes, or should be taken to include, the Christchurch Replacement District Plan (“CRDP”) amended by Decision 43 of an Independent Hearing Panel (“IHP”) chaired by retired High Court Judge, Sir John Hansen. The IHP was established to hear submissions on the CRDP, which was developed in response to the Canterbury Earthquakes in 2010 and 2011. Decision 43 was released on 20 September 2016 and was not operative when the Reconsideration Decision was made on 29 September 2016, but the time for appeal was running. In the result no appeal was filed. Decision 43 has not yet been made operative by the Council, but that is a formality.
[8] Decision 43 addressed the extent and importance of entertainment facilities in the city, including the protection of existing investment and the relationship of licensed premises and their customers with nearby residents. HNZ says the Council should have had regard to the CRDP and Decision 43 expressly within the definition of a District Plan for which it contends, or otherwise by implication. In the alternative, it says it was unreasonable not to bring it to account, as it was relevant and may have influenced the Reconsideration Decision.
[9] An underlying theme of this judicial review is the relationship between the Resource Management Act 1991 (“RMA”), which governs the development of a District Plan, and the SSAA which governs alcohol licensing. The two processes bear on one another when a territorial authority decides to develop a LAP under the SSAA. A LAP may be more restrictive, but it cannot licence the sale of alcohol where that is prohibited by a District Plan.
Council’s position
[10] The Council says that it was under no obligation to have regard to any District Plan when it made the Reconsideration Decision. It says that obligation was spent after it developed a Provisional Local Alcohol Policy (“PLAP”), the next step in the chain after a Draft Local Alcohol Policy (“DLAP”) was adopted and publicly notified by the Council.
[11] If that is wrong, it says the District Plan was out of date but still the Operative
Plan, and did not include the CRDP or Decision 43. If that is wrong, it says Decision
43 was brought to account. If it is wrong in all respects and it should have had regard to Decision 43, it says that no relief should be granted as HNZ’s concerns will be adequately addressed on the appeal(s) which lie before the ARLA.
The pleading
First cause of action - failure to have regard to a mandatory relevant consideration
[12] The statement of claim pleads:
61.In making its reconsideration decision, and adopting the Victoria Street Split and 3-year cut off, the Council erred in law by failing to have regard to the objectives and policies of its district plan as amended by the IHP in its Decision 43.
Particulars:
(a) In making its reconsideration decision, the Council was required to consider the relevant objectives and policies of its district plan under s 78(2) of the SSAA, which applies pursuant to s 79(1) of the SSAA.
(b) Decision 43 amended relevant objectives and policies, and explained the reasons for those amendments, including as summarised in paragraphs [57] to [59] above.
(c) The reasons for the Council’s reconsideration decision are
contained in the reasons table.
(d) The reasons table does not refer to Decision 43.
62.Had the Council had regard to Decision 43, it could not have adopted the Victoria Street split and the 3 year cut off for North Victoria Street.
63.This error was material to the reconsideration decision, including because the objectives and policies (and other district plan provisions) had changed (including through Decision 43) since the Council first produced its draft LAPs and its provision LAP.
Second alternative cause of action – unreasonableness/rationality
[13] The statement of claim pleads:
66.If the Council did have regard to Decision 43 in making its reconsideration decision, it erred in law by acting unreasonably and irrationally in adopting the Victoria Street Split and 3-year cut off in light of Decision 43.
Particulars:
(a) Decision 43 amended relevant objectives and policies, and explained the reasons for those amendments, including as summarised in paragraphs [57] to [59] above.
(b) The nature of the findings and observations in Decision 43, strongly support treating all parts of Victoria Street (and Carlton Corner) equally, given:
(i) their identification within the same Entertainment
Precinct;
(ii) that the precinct rules protect community amenity (if that were to be more of a concern for some parts of Victoria Street than others);
(iii) the deliberate strong policy encouragement to the entertainment and hospitality industry to focus on establishing within the entertainment precinct (not just some parts of it);
(iv) the very significant investment recognised in the Victoria Street Precinct, including North Victoria Street; and
(v) the significant adverse consequences on existing and future investment of adopting the Victoria Street Split and 3-year cut off in North Victoria Street.
(c) The Council’s district plan team were well aware of Decision 43, and had, in fact participated in the relevant hearings and generally supported the outcomes that were confirmed in Decision 43.
(d) Despite the position identified in paragraph (c) of the pleadings above, the Council adopted a contrary position in its amended PLAP.
(e) The Council could not have had sufficient time to take appropriate advice in respect of Decision 43 (issued on
20 September 2016) before making its reconsideration decision (on 29 September 2016), just seven working days after the release of Decision 43.
67.Had the Council acted reasonably and rationally, including in a manner consistent with its position in respect of Decision 43, and having taken time to take appropriate advice, it could not have adopted the Victoria Street Split and the 3-year cut off for North Victoria Street.
Statement of defence
[14] The Council denies that Decision 43 should have been brought to account for any of the reasons pleaded by HNZ and also pleads:1
… that different statutory considerations applied to Decision 43 made by the Independent Hearings Panel on the one hand, and the defendant’s decision in relation to the PLAP on 29 September 2016 on the other;
“have/had regard to”
[15] At times in this Interim Judgment the concept of “have regard to” Decision
43 and the CRDP will be reflected in expressions such as “considered” and “brought to account”. Each for the purpose of this Interim Judgment comprehends giving genuine attention and thought to various instruments.
B DEVELOPMENT OF A LOCAL ALCOHOL POLICY
The statutory scheme
[16] This is conveniently set out in the statement of claim, which I adopt with some alterations:
Statutory Framework
Key elements of a LAP
Under s 75(1) of the SSAA, the Council has a discretion to have a LAP. Under s 75(3) of the SSAA, a LAP must be produced, adopted and brought
into force, in accordance with sub-pt 2 of the SSAA (comprising ss 75 to
97).
Under s 75(2), of the SSAA, a LAP may:
(a) provide differently for different parts of its district –
s 75(2)(a); and
(b) apply differently to premises for which licences of different kinds are held or have been applied for – s 75(2)(c).
Further, under s 77(1) of the SSAA, a LAP may include policies on any or all of the following matters relating to licensing (and no others):
(a) location of licensed premises by reference to broad areas:
1 Paragraph 66(b) Statement of Defence dated 21 December 2016.
(b) location of licensed premises by reference to proximity to premises of a particular kind or kinds:
(c) location of licensed premises by reference to proximity to facilities of a particular kind or kinds:
(d) whether further licences (or licences of a particular kind or kinds) should be issued for premises in the district concerned, or any stated part of the district:
(e) maximum trading hours:
(f) the issue of licences, or licences of a particular kind or kinds, subject to discretionary conditions;
(g) one-way door restrictions.
Under s 77(3) of the SSAA, a LAP must not include policies on any matter not relating to licensing.
Preparing a draft LAP
Under s 78(1) of the SSAA, a territorial authority that wishes to have a LAP
must produce a draft policy (“draft LAP”).
Under s 78(2) of the SSAA, when producing a draft LAP, a territorial authority must have regard to:
(a) the objectives and policies of the district plan; and
(b) the number of licences of each kind held for premises in its district, and the location and opening hours of each of the premises; and
(c) any areas in which bylaws prohibiting alcohol in public places are in force; and
(d) the demography of the district’s residents; and
(e) the demography of people who visit the district as tourists or holidaymakers; and
(f) the overall health indicators of the district’s residents; and
(g) the nature and severity of the alcohol-related problems arising in the district.
In respect of the district plan, under s 93(1) of the SSAA, a LAP may contain a policy more restrictive than the relevant district plan.
Producing a provisional LAP
Under s 79(1) of the SSAA, if, after producing a draft LAP, a territorial authority continues to wish to have a LAP, it must produce a provisional policy (“provisional LAP”) by using the special consultative procedure to consult on the draft policy.
Under s 79(2) of the SSAA, when producing a provisional LAP, a territorial authority must (again) have regard to the matters stated in s 78(2) of the SSAA.
Under s 80 of the SSAA, if, after producing a provisional LAP under s 79, a territorial authority continues to wish to have a LAP, it must then give public notice of:
(a) the provisional LAP; and
(b) rights of appeal against it; and
(c) the ground on which an appeal may be made.
Appealing a provisional LAP
Under s 81(1) of the SSAA, a person or party, who or which made submissions as part of the special consultative procedure on a draft LAP may, within 30 days of the public notification of the resulting provisional LAP, appeal to the licensing authority (“ARLA”) against any element of that provisional LAP.
Under s 81(4) of the SSAA, the only ground on which an element of a provisional LAP can be appealed against is that it is unreasonable in the light of the object of the SSAA.
Under s 4(1) of the SAA, the object of the SSAA is that:
(a) the sale, supply, and consumption of alcohol should be undertaken safely and responsibly; and
(b) the harm caused by the excessive or inappropriate consumption of alcohol should be minimised.
Under s 4(2) of the SSAA, the harm caused by the excessive or inappropriate consumption of alcohol includes:
(a) any crime, damage, death, disease, disorderly behaviour, illness, or injury, directly or indirectly caused, or directly or indirectly contributed to, by the excessive or inappropriate consumption of alcohol; and
(b) any harm to society generally or the community, directly or indirectly caused, or directly or indirectly contributed to, by any crime, damage, death, disease, disorderly behaviour, illness, or injury of a kind described in paragraph (a).
Under s 207 of the SSAA:
(a) ARLA may receive as evidence any statement, document, information, or matter that in its opinion may assist it to deal effectually with any matter before it, whether or not the statement, document, or matter would be admissible in a court of law.
(b) Subject to paragraph (a), the Evidence Act 2006 applies to ARLA, in the same manner as if ARLA were a court within the meaning of that Act.
Under s 201(1) of the SSAA, ARLA must, within the scope of its jurisdiction, be treated as being a Commission of Inquiry under the Commissions of Inquiry Act 1908; and that Act, with any necessary modifications, applies accordingly.
Consideration of a provisional LAP
Under s 83(1) of the SSAA:
The licensing authority must dismiss an appeal against an element of a provisional local alcohol policy if it –
(a) is not satisfied that the element is unreasonable in the light of the object of this Act; or
(b) is satisfied that the appellant did not make submissions as part of the special consultative procedure on the draft local alcohol policy concerned.
Under s 83(2) of the SSAA, if ARLA is satisfied that:
(a) the appellant made submissions as part of the special consultative procedure on the draft LAP concerned; and
(b) an element of the provisional LAP is unreasonable in the light of the object of the SSAA;
then ARLA must ask the territorial authority concerned to reconsider that element.
Under s 83(4) of the SSAA:
(4) The appellant has no right of appeal against the decision of the licensing authority.
Under s 84(1) of the SSAA, if ARLA asks a territorial authority to reconsider an element of a provisional LAP, the territorial authority must:
(a) resubmit the LAP to ARLA with the element deleted; or
(b) resubmit the LAP to ARLA with the element replaced with a new or amended element; or
(c) appeal to the High Court against ARLA’s finding that the element is unreasonable in the light of the object of this Act; or
(d) abandon the provisional LAP.
Resubmission of an amended PLAP
Under s 86 (1) of the SSAA, if the territorial authority resubmits the LAP to
ARLA with the element replaced or with a new or amended element
(“amended PLAP”), ARLA must deal with amended PLAP as if it were an
appeal against every new or amended element that has replaced an earlier element appealed against it.
Decision on an amended PLAP
Under s 87 of the SSAA, if ARLA is satisfied, in respect of an amended PLAP, that every element it asked the territorial authority to reconsider has been replaced by a new or amended element that is not unreasonable in the light of the object of the SSAA, the amended PLAP is adopted when ARLA makes its decision.
Review of a LAP
Under s 97 of the SSAA, a territorial authority that has a LAP must review it, using the special consultative procedure:
(a) no later than 6 years after it came into force; and
(b) no later than 6 years after the most recent review of it was completed.
Narrative of the LAP process
[17] The Council decided to develop a LAP by resolution dated 14 February 2013, although work had begun in late 2012. The parties agree on this bare narrative.
The Christchurch City Council LAP process
The draft LAPs
In mid-late 2012, the Council began to prepare a draft LAP. The Council produced four iterations of its draft LAP.
Each draft LAP identified an area as Christchurch Central Area A (“Central
Area A”).
Within Central area A, a maximum closing time of 3am for on-licence premises was to be allowed.
Outside of Central Area A, in Central Area B, on-licence premises were to be limited to a maximum closing time of 1am.
In the first three iterations of the Council’s draft LAP:
(a) Central Area A corresponded with those areas identified as
Entertainment Precincts in the District Plan.
(b) Central Area A included Victoria Street (as a whole).
The fourth iteration of the draft LAP excluded Victoria Street (as a whole) from Central Area A, with the result that trading hours for on-license premises on Victoria Street were to be limited to a maximum of 1am.
The Carlton Corner was not included in Central Area A in any of the iterations of the draft LAP.
The provisional LAP
In May 2013, the Council called for submissions on its draft LAP, through the special consultative procedure under the Local Government Act 2002.
In July and August 2013, the Council held public hearings on the draft LAP, producing a report in late 2013.
On 28 May 2015, the Council provided notification of its decision to adopt a provisional LAP.
Appeals to ARLA
In June 2015, nineteen appeals were made to ARLA in respect of the provisional LAP, including an appeal by HNZ.
In May 2016, the parties to the appeals attended mediation.
Reconsideration of the provisional LAP
In June 2016, the Council advised ARLA that it considered 13 elements of its provisional LAP to be unreasonable in light of the object of the Act.
On 21 September 2016, ARLA directed the Council to reconsider those
13 elements of its provisional LAP (“ARLA reconsideration direction”).
On 29 September 2016, the Council met to reconsider its provisional LAP
(“reconsideration meeting”).
The Council had the following information before it at its reconsideration meeting:
(a) an officer report, authored by Vivienne Wilson, Senior
Solicitor;
(b) a memorandum containing additional legal advice, from
Vivienne Wilson, Senior Solicitor; (c) the ARLA reconsideration direction;
(d) an amended version of the provisional LAP, showing
changes (“amended PLAP”); and
(e) a table showing changes to the provisional LAP, which included a column headed “reasons for change” (“reasons table”).
The Council, at its reconsideration meeting, decided to adopt the amended
PLAP for resubmission to ARLA (“reconsideration decision”).
The amended PLAP, in respect of Victoria Street:
(a) includes the area of Victoria Street between Salisbury Street and Kilmore Street (“South Victoria Street”) within Central Area A, and therefore within the 3am maximum closing time area (the area was previously within Central Area B);
(b) continues the area of Victoria Street between Salisbury Street and Bealey Avenue (“North Victoria Street”) within Central Area B but provides for that area to have a maximum
3am closing time for a 3-year transitional period and the maximum closing time to be 1am thereafter (“3-year cut
off”); and
(c) includes the Carlton Corner within Central Area B and applies the 3-year cut off to it.
Victoria Street - 2013
[18] The first preliminary draft of the LAP placed Victoria Street in Central Area 1, with maximum on-licence trading hours of 8:00am to 3:00am. There was a section on “Legal Considerations” which set out the provisions of s 78(2) of the SSAA.2 A report made to the Planning Committee referred to the “Goals of the LAP” and “Objectives of the LAP”, and Appendix 1 referred to “Liquor licensing policy in the District Plan” and Policy 4.2.15, “Sale of Liquor”. The report reads:
The background to the City Plan liquor related rules can be found in the liberalised regime for licensed premises resulting from the passage of the Sale of Liquor Act 1989, and the Council’s experience with the intensification of adverse effects of late hour operations on residential amenities. These adverse effects stem from a range of activities directly associated with the sale of liquor for consumption on the premises. They include marked noise impacts from large gatherings, related musical or entertainment activities, from traffic entering and leaving the premises and from noise in carparks.
The rules (methods) cannot and do not, purport to control all adverse effects associated with licensed premises, particularly as they do not apply outside late hour operations.
The adverse effects that the rules are designed to mitigate are:
· Reduction in potential noise effects associated with vehicles and people entering leaving and within carparks.
2 Paragraph 14.
· Reduction in potential noise effects associated with late hour sale of liquor and associated music and entertainment activities.
The rules recognise the period during which activities have the greatest potential to create disturbance to residents, and more importantly, the “amenities” implications of sale of liquor. (11am – 7pm). This is a specific matter which can be addressed under the Resource Management Act, and which cannot be adequately addressed under the Sale of Liquor Act. The rules, in order to adequately address adverse effects, apply to existing or proposed licensed premises proposing to have late hour sales both within and adjoining living zones.
[19] Delegations were made to the Council by HNZ, the Police District Commander, the Medical Officer of Health, the Victoria Neighbourhood Association (“VNA”), and a licensee. The VNA outlined the concerns of residents about the negative impact of new late-night bars in the neighbourhood, which was the only largely intact residential area in the Central City following the February 2011 earthquake.
[20] Victoria Street was placed in Central Area A, with the same licensing hours. The Planning Committee reported to the Council with this second iteration of the DLAP, and the matters to which the Council was required to have regard under s 78(2) of the SSAA. The objectives and policies of the operative Christchurch City Plan and the Banks Peninsula District Plan were included, as they further comprehended the City Plan.
[21] A third draft had been tabled, entitled “Version 1: draft statement of proposal
and other material as per the Planning Committee’s recommendations of
8 May 2013”. On 16 May 2013, the Council resolved to adopt a fourth (and final) DLAP, called Version 2. Public notice was given on 29 May 2013. The Council had regard to matters in s 78(2) of the SSAA, referred to in Attachments 3 and 4 of the Planning Committee’s report to the Council, and paragraph 32 of that report. Victoria Street was in Central Area B with maximum trading hours of 8:00am to
1:00am. A policy option of 3:00am closing was considered, but not adopted, because:
Strong feedback from nearby residential community about problems arising from current 3am closing of some premises, and one premise closing at 5am.
[22] The DLAP was adopted for public consultation on 16 May 2013, and a committee of the full Council was delegated authority to hear submissions and decide on the form and content of the next stage of a LAP process, the PLAP. 4,060 submissions were received. Changes were made to the DLAP, enlarging the area within the Central City where on-licences can trade until 3am. The Committee had regard to the matters in s 78(2) of the SSAA, and submissions.
[23] The Council resolved to make changes to the DLAP and to produce a PLAP. It is clear where contest was joined. The hospitality sector opposed reduced trading hours and wanted 3:00am, and some 5:00am, closing times. The VNA, Police and other residents strongly supported 1:00am closing on Victoria Street which the Police considered a post earthquake hotspot for alcohol related crime. A report on the hearings referred to the range of submissions for Victoria Street:
The exclusion of Victoria St from Area A drew vigorous and opposing submissions. Individual residents and the local neighbourhood association strongly supported provision 2.2.2 as in their view it recognises the long-standing and highly-valued residential character of the area and the spatial unsuitability of it as a late night entertainment area (proximity of premises to residential living and the consequential negative behaviour and unpleasant effects, loss of sound buffers, inadequate space for public transport options). However, premises operating on Victoria St submitted that they operate very well-run premises and are working collaboratively with fellow licensees to address matters of amenity and good order. In their opinion, the inclusion of the area in the Christchurch Central Recovery Plan as an entertainment precinct, and resource consenting decisions to take, vindicate their location and current trading hours there. They felt that the presence of the Casino on Victoria St (with 24 hour opening) is a further endorsement of the area as appropriate for late-night trading. Victoria St was seen by many submitters as a successful and popular late-night area to visit, offering a welcome bar scene for younger people post-earthquake.
[24] The Committee enlarged the late night area (Central Area A), but made no change to the 1:00am maximum closing time on Victoria Street.
Delay in PLAP process
[25] After local authority elections on 12 October 2013, the process was on hold while the results of some appeals to the ARLA became known. It was not until
28 May 2015 that the Council resolved to notify the PLAP.
[26] 19 appeals to the ARLA were filed, with notice of interest by eight parties. On 10 December 2015, the Council approved the establishment of the Provisional Local Alcohol Policy Appeals Working Party (“the Working Party”) to which five Councillors were appointed. The Working Party agreed to go to mediation, funded by the Council, and a two stage process was established, for on-licence and off-licence issues. Mediation took place on 11 May 2016 for on-licence issues. The Working Party was briefed by New Zealand Police about alcohol related harm in Victoria Street and across Christchurch City.
Reconsideration
[27] The Council received a report on the mediation and negotiation, and on
14 June 2016 resolved to request the ARLA to ask it (the Council) to reconsider specific elements of the PLAP, which it by this stage considered unreasonable in light of the object of the SSAA. This, in my view, practical process was established by the ARLA Practice Note of 19 March 2015, and it bears on this Interim Judgment, as to what relief should be ordered.
[28] The Council was directed by the ARLA to file a memorandum summarising the reasons why it considered a number of elements of the PLAP were unreasonable in light of the object of the SSAA, and a joint memorandum was filed dated
23 August 2016.
[29] Clause 16 of the joint memorandum provided as follows:
Provisional Local Alcohol Policy – Map 1 (which shows Christchurch
Central Area A and Christchurch Central Area B)
This element is a map of the central city showing the boundaries of Christchurch Central Area A and Christchurch Central Area B, which are referred to in clauses 2.2.3, 2.2.4 and 2.2.5 relating to maximum on-licence trading hours. The Council considers this element to be unreasonable in light of the object of the Act because:
Changes to Christchurch Central Area A
(a) Exclusion of Victoria Street south of Salisbury Street from Central Area A pays insufficient regard to its relative proximity to the Central business District which is in Christchurch Central Area A, the presence of the Christchurch Casino as a focus for late night activity, the impact 1 am closing would have on holders of
on-licences in this location, and evidence that non-regulatory measures have been effective in reducing certain types of alcohol-related harm experienced by residents living close to Victoria Street;
(b) Exclusion of parcels of land bounded by Manchester Street, St Asaph Street and High Street, and by High Street, Lichfield Street, Madras Street and Tuam Street, from Christchurch Central Area A could create a “black spot” after 1 am between adjacent areas subject to 3 am closing, in which “side-loading” or other inappropriate consumption of alcohol could occur in the absence of active or passive surveillance. 1 am closing is also unreasonable now that there is greater certainty as to future land use in the South Frame than was the case when the PLAP was adopted in
2013;
Change to Christchurch Central Area B
(c) Exclusion of land occupied by the Carlton Bar and Eatery on the corner of Bealey Avenue and Papanui Road from Christchurch Central Area B pays insufficient regard to this land being functionally part of the Victoria Street Precinct, meaning it should be subject to the same maximum trading hours as other on-licensed premises on Victoria Street between Bealey Avenue and Salisbury Street. It also pays insufficient regard to the impact 1 am closing would have on the holder of the on-licence for these premises, if effective immediately rather than after a transitional period of some duration.
[30] On 21 September 2016, the ARLA made an order by consent directing that the Council reconsider 13 elements of the PLAP, which necessarily meant that they were thought to be unreasonable, and otherwise resolved all appeals, bar one. The 13 elements included provisions relating to Victoria Street.
[31] The full Council addressed the 13 elements of the PLAP which the ARLA asked it to reconsider. A report to Council detailed the recommended changes and explained the reasons for them. The recommended changes included:
(a) Recategorising the stretch of Victoria Street between Salisbury Street and Kilmore Street from Christchurch Central Area B to Christchurch Central Area A i.e. changing the maximum closing time in that area from 1am to 3am (4am for nightclubs);
(b) Providing that the stretch of Victoria Street between Salisbury Street and Bealey Avenue, including Carlton Corner, would have a 3am maximum closing time for a 3 year transitional period (and 1am thereafter) – as compared to the position under the original PLAP where there was no transitional period and the 1am time limited applied immediately.
[32] The reasons for these changes were given in Attachment C to the report prepared for the Council meeting on 29 September 2016:
The 3 year transitional period before 1am closing is required recognises (sic) the slower than expected rebuild of the City Centre in Christchurch Central Area A where it had been anticipated that late night trading would occur. The transitional period alleviates the impact of the shift to 1am maximum closing on affected licence holders.
3am closing for a transitional 3 year period recognises evidence that non-regulatory measures have been effective in reducing certain types of alcohol related harm experienced by residents living close to Victoria Street.
The 1 hour reduction to the default national maximum trading hours (which provide for 4am closing) for the 3 year transitional period will prevent the potential for alcohol related harm caused by on-licence sales after 3am.
1am closing after 3 years will reduce certain types of alcohol related harm experienced by residents living close to Victoria St, and concentrate late-night trading within Central Area A which will be more manageable for enforcement purposes.
After the three year transitional period expires, those wishing to purchase and consume alcohol in a safe and responsible manner will still have opportunities for late-night consumption until 3am in Central Area A.
Carlton Corner is functionally part of the Victoria Street Precinct and should be recognised as such.
[33] On 29 September 2016, the Council resolved to change the 13 elements of the PLAP it had been asked by the ARLA to reconsider, and the PLAP was resubmitted to the ARLA on 26 October 2016.
Appeals to the ARLA
[34] Two appeals were filed, one by HNZ and the other by Caliente Kitchens Limited, Papanui Road Limited and Stealth Hospitality Limited (“Caliente”). The appeals relate to the on-licence trading hours and other elements of the PLAP relevant to this judicial review. 15 parties filed interested party notices. HNZ advised its intention to bring judicial review proceedings on 24 November 2016.
HNZ appeal
[35] The HNZ appeal referred to the grounds of appeal advanced by Caliente. HNZ appealed against the maximum trading hours for on-licence premises, late
night areas proposed by the Council, and exclusion of Victoria Street from Central City Area A. Brief reference is required to consider the potential relevance of Decision 43 in the context of the appeals.
[36] HNZ appealed the PLAP on the following grounds:
(a) The elements of the PLAP appealed against are unreasonable in light of the object of the Sale and Supply of Alcohol Act 2012 (“SSAA”) being that:
(i) the sale, supply, and consumption of alcohol should be undertaken safely and responsibly; and
(ii) the harm caused by the excessive or inappropriate consumption of alcohol should be minimized.
(b) There is no probative evidence that the sale and supply, and consumption of alcohol is not being undertaken safely and responsibly in Christchurch;
(c) There is no probative evidence that harm is being caused by the excessive or inappropriate consumption of alcohol in Christchurch;
(d) The Council’s reasons for adopting the PLAP are unclear, uncertain and unreasonable in light of the object of SSAA;
(e) The PLAP does not appropriately respond to the local characteristics of the alcohol related harm in Christchurch;
(f) The PLAP fails to respond to or recognise Christchurch’s evolving planning framework, and is inconsistent with the Christchurch Central Recovery Plan and the Entertainment precincts identified in the Addendum dated December 2014 to the Central City Plan;
(g) The PLAP is a disproportionate or excessive response to potential harm in the Central City; and
(h) The PLAP is partial and unequal in terms of its treatment of land in the Central City.
[37] The notice of appeal then particularises the effect on profitability of the hospitality industry and negative flow-on effect into the Christchurch economy if licensing hours are constrained to a 1:00am closing time. The PLAP is said to be inconsistent in the location of late-night entertainment areas and their proximity to residential development, given that 940 townhouses will potentially be established in the Eastern frame central to Christchurch, as close as 20 metres from the late-night
entertainment precinct areas, whereas in other areas of the Central City residential development is, in most cases, in excess of 50 metres from such areas.
[38] The exclusion of parts of Victoria Street from Christchurch Central Area A is said to be unreasonable in light of the objects of the SSAA, because it is a commercial zone in the Central City Plan, and represents a successful and long established late-night economy that has flourished post-earthquake. A large number of resource consents for 3:00am and 4:00am trading have been approved in Victoria Street. The detriment to businesses and the Christchurch economy by revocation of rights to late-night trading are raised on appeal.
[39] Under “Christchurch Rebuild”, the grounds of appeal record:
8.27Christchurch has an evolving planning framework and accordingly is unique to any other environment in New Zealand. The PLAP fails to recognise this framework and, accordingly, is inconsistent with the Canterbury Regional Policy Statement, the Proposed Replacement District Plan, the Christchurch Central Recovery Plan, and in particular, the Entertainment Precincts identified in the Addendum dated December 2014.
8.28Given the evolving planning framework, the Council has not been able to have regard to the matters set out in section 78 of the Act because those matters are evolving as Christchurch is being rebuilt. The inability of the council to have regard to the matters set out in section 78 means that the PLAP is unreasonable in light of the object of the Act.
8.29Significant investment decisions have been made in reliance on the Christchurch Central Recovery Plan. The PLAP undermines those investment decisions without providing any alcohol related harm reduction benefits.
8.30The differentiation in trading hours between on-licences will create a clear economic advantage to some on-licence businesses. Furthermore, a reduction in operating hours will lead to a decrease in the hospitality industry and will ultimately impact on the Christchurch economy.
[40] It seems that HNZ at this point treated the CRDP as important but outside the scope of the District Plan under s 78(2)(a) of the SSAA.
Caliente
[41] The notice of appeal by Caliente states that the amended PLAP is unreasonable in light of the object of the SSAA. It says that the amended PLAP has “split” Victoria Street into two parts, and the appeal is brought against the North Victoria Street maximum 1:00am closing after the first three years of the LAP, with reference to the High Street Block.
[42] It pleads that it is unreasonable in light of the object of the SSAA to differentiate between North and South Victoria Streets and other parts of Central Area A, and that it has been held not necessary to limit on-licences to earlier than a
3:00am closing time for South Victoria Street and other parts of Central Area A in order to minimise harm. Harm is “something significant” and goes beyond “amenity” which is addressed under the RMA 1991, and the District Plan adopted under the RMA.
[43] It asserts a lack of evidence that after three years of a transitional 1:00am closing time, a 3:00am closing time would cause harm over and above that from
3:00am closing time for South Victoria Street and other parts of Central Area A, and that fairness and equal treatment is a fundamental requirement of justice.
[44] The Entertainment Precincts and Victoria Street (as a whole), were considered by the IHP in Decision 43, which made no distinction in objectives and policies between North and South Victoria Street, and “there is no real distinction between North and South Victoria Street”. Decision 43 is described with reference to Objective 15.1.5 and Policy 15.15.2.6.7, discussed in detail in Question (2) of Part D to this Interim Judgment.
[45] Caliente seeks relief that the ARLA ask the Council to reconsider the amended PLAP to the extent it limits North Victoria Street to a maximum of 1:00am closing time after the first three years of the LAP, and includes the High Street Block, with one exception, within Central Area A.
[46] The notice of appeal asserts that the CRDP process and decisions under it should be brought to account in the appeal to the ARLA. Hitherto, there had been no such reference that I can identify.
CCHRISTCHURCH REPLACEMENT DISTRICT PLAN AND DECISION 43
[47] At the heart of this judicial review is the extent to which, if at all, the LAP
process should have had, and should now have, regard to the CRDP and Decision 43.
[48] HNZ pleads Decision 43 in this way:
A review process to replace the then operative district plan with a “Replacement Plan” was established under the Canterbury Earthquake (Christchurch Replacement District Plan) Order 2014 (“OIC”), which was promulgated under s 71 of the Canterbury Earthquake Recovery Act 2011.
Clause 6 of the OIC, directed the Council to “undertake a full review of the operative provisions of the existing district plans” and to develop a replacement plan by preparing and notifying proposals (“Proposals”).
An Independent Hearings Panel (“IHP”) was established to hear and determine a replacement district plan for Christchurch (“Christchurch Replacement Plan”).
Clause 12(1) of the OIC directs the IHP to hold a hearing on submissions on a Proposal and make a decision on a Proposal.
Clause 14(1) of the OIC sets out what the IHP must and may consider in making its decision on a Proposal.
Clause 5 of the OIC qualifies how the Resource Management Act 1991
(“RMA”) is to apply and modifies some of the RMA’s provisions, both as to
our decision-making criteria and processes.
The Statement of Expectations contained in Schedule 4 of the OIC records, in respect of objectives and policies:
The expectations of the Minister for Canterbury Earthquake Recovery and the Minister for the Environment are that the replacement district plan –
… (b) contains objectives and policies that clearly state the outcomes that are intended for the Christchurch district.
In its first decision, Decision 1, the IHP found that the evidence satisfied it, in order to achieve the purpose of the RMA:
(a) The expedited recovery and future enhancement of
Christchurch as a dynamic, prosperous and internationally-
competitive city was the overarching outcome that the
Replacement Plan should serve for the district; and
(b) That outcome objective needed to be accompanied by one focussed on process efficiency and clarity of language, framed to reflect what the Statement of Expectations identifies on these matters.
In a later decision, Decision 43, the Independent Hearing Panel addressed, among other things:
(a) The extent of the Entertainment Precinct in respect of Victoria Street, and in particular whether the Entertainment Precinct should include Carlton Corner.
(b) The objectives and policies that apply to the Entertainment
Precinct and address the “late night” sale of alcohol.
The evolution of Decision 43
[49] Mr Alan Matheson is the Team Leader, District Plan (Planning and Strategic Transport) at the Council, and has been since November 2012. He described the history of the District Plan, and the CRDP.
[50] The Christchurch City Plan became operative on 21 November 2005 and the Banks Peninsula District Plan became operative on 15 October 2012. Review of both Plans was underway before the Canterbury earthquake sequence which commenced on 4 September 2010, as the Plans were outdated and needed to be combined into one Plan. There was no Proposed District Plan for Christchurch City, so at that time the only District Plans were those operative for Christchurch City and Banks Peninsula.
[51] The earthquakes meant the District Plan review did not progress to notification of a Proposed District Plan under the RMA and instead the CRDP was initiated. This was the governmental response and it required swift and comprehensive completion. Christchurch was on its knees. A tight timetable was established so all decisions would be made by April 2016, later extended to
16 December 2016. Three stages to the proposals for the CRDP were established, in sequence.
[52] The IHP issued decisions on all proposals which made up the CRDP. Appeals were restricted to questions of law to the High Court. There have been few. Decision 43 was issued on 20 September 2016, nine days before the Reconsideration Decision.
[53] Public notice of Decision 43 was given on 27 September 2016 and the appeal period expired on 26 October 2016, with no appeal lodged. Under clause 15 of the Order in Council (“OIC”), a proposal is deemed to have been approved by the Council under clause 17(1) of Schedule 1 of the RMA from the date the appeal period expired in this case, 26 October 2016. However, under clause 16 of the OIC, the proposal does not become operative as part of the CRDP until public notice is given by the Council in accordance with Clause 20 of Schedule 1 of the RMA. The Council has not yet given public notice, although other decisions of the IHP have been made operative. Once the proposal is operative, it replaces parts of the “existing District Plans”, being the Operative Plans as at 7 July 2014.
[54] When the PLAP was reconsidered by the Council on 29 September 2016, Decision 43 was not, and could not have, been operative because the appeal period had not expired.
[55] HNZ says Decision 43 makes no distinction between “North” and “South” Victoria Street, and the only boundary change to the overall precinct was to add in the Carlton Corner precinct. The IHP decided that there is no reason for different levels of entertainment and hospitality within the (overall) Victoria Street Entertainment Precinct, compared to other areas, and precinct rules protect community amenity. It referred to the significant investment in the Victoria Street precinct, and expressed concern if that investment was put at risk. Decision 43 states
that there is:3
a strong policy encouragement to the entertainment and hospitality industry to focus on establishing within the precincts.
3 At [129].
[56] The Decision addresses the relevant objective and policy provisions relating to entertainment and hospitality in the Commercial Zones. It is concerned with the following provisions of the CRDP:
15.2.5 Objective – Diversity and distribution of activities in the
Central City
a.A range of commercial, community, cultural, residential and guest accommodation activities are supported in the Central City to enhance its viability, vitality and the efficiency of resources, while encouraging activities in specific areas by …
iv. Encouraging entertainment and hospitality activity (including late-night trading) in defined precincts and managing the extent to which these activities occur outside the precincts.
15.2.6.3 Policy – Amenity
a.Promote a high standard of amenity and discourage activities from establishing where they will have an adverse effect on the amenity values of the Central City by…
vi. identifying entertainment and hospitality precincts and associated noise controls for these and adjacent areas, and encouraging such activities to locate in these precincts;
15.2.6.7 Policy – Entertainment and Hospitality Precinct
a.Provide for an entertainment and hospitality precinct, including late night trading, in the Central City, by:
i. encouraging entertainment and hospitality activities to locate within the identified area;
ii. protecting the viability of existing entertainment and hospitality investment, particularly that investment which has occurred in the Central City since the Canterbury earthquakes;
iii. providing certainty to investors that residential amenity effects related to late night trading will be managed by rules relating to noise and off site effects.
15.2.7.1 Policy – Diversity of activities
a. Enhance and revitalise the Commercial Central City
Mixed Use Zone by enabling…
vii. entertainment and hospitality activities of a scale, type and duration that do not conflict with or undermine existing and future residential activity, not undermine the identified hospitality and entertainment precincts.
[57] The IHP made observations and findings:4
There is nothing in the plain wording of the CCRP to suggest there should be different levels of entertainment and hospitality activities within the Category 1 and Category 2 zones. The lower level noise simply reflects that Victoria Street is closer to residential areas than the others. It does not carry with it, in our view, the presumption that Mr Willis gave it that it must mean differing activity, ie more for restaurants and cafes and not late night entertainment.
… we are satisfied the precinct rules brought in by the CCRP amendments protect community amenity. It also needs to be recognised, however, that following the earthquake much of the Central City was in no position to respond to citizens’ hospitality and entertainment needs. Victoria Street did, to the benefit of the City. They invested significant capital. Mr Osborne acknowledges that if that investment was at risk, that would be a matter of concern from an economist’s perspective. CCC and submitters seem to set this to one side.
…it would be a matter of concern if the existing investment in the
entertainment precincts was at risk.
The evidence we have shows there is a very significant investment in the Victoria Street precinct which relied on the CCRP and its amendments. It is also clear that, despite the CCRP, at least those three witnesses managed to interpret it in a way that is contrary to the plain words. In those circumstances there is a real risk other planners could do the same.
We see as significant the addition of the words “and encouraging such activities to locate in these precincts.” As is the ability of allowing PA status for these activities that meet noise and other relevant standards. Elsewhere in the Central City a resource consent may need to be sought where more stringent noise standards apply. We read the additional words as a strong policy encouragement to the entertainment and hospitality industry to focus on establishing within the precincts.
4 At [97], [114], [120], [128] and [129].
[58] Mr Thorne, in evidence for the Council, says the objectives and policies introduced by Decision 43 maintain the approach of ensuring entertainment and hospitality precincts are not undermined.
[59] Decision 56 is a separate and subsequent Decision of the IHP, which determined some matters relating to the sale of alcohol. It decided that objectives, policies and rules should be included to address the sale and/or supply of alcohol in all zones, with one exception. The sale and/or supply of alcohol between the hours of 11:00pm and 7:00am from any site located within 75 metres of a Residential Zone is a restricted discretionary activity, with five exemptions including Victoria Street. I need only mention this, as it may or may not have bearing on what follows this Interim Judgment.
D QUESTIONS RAISED ON THIS JUDICIAL REVIEW
[60] The pleading requires answers to the following questions.
Question (1): In making a Reconsideration Decision which comes after a DLAP, PLAP, and the filing of an appeal to the ARLA, is a Council required to have regard to a “district plan” (however defined), or is that obligation spent by that stage?
Question (2): If a Reconsideration Decision requires that the Council have regard to the District Plan, is that only an operative plan, or does it expressly or impliedly include a proposed plan, in this case the CRDP and Decision 43?
Question (3): If the Council was expressly or impliedly required to have regard to CRDP and Decision 43, was it so unreasonable not to have regard to it, that it should vitiate the Reconsideration Decision?
Question (4): Did the Council have regard to the CRDP which includes
Decision 43?
Question (5): Should this Court order relief by requiring the Council to reconsider given that HNZ has appealed to the ARLA and seeks the same relief which motivates this judicial review?
[61] The Answers to each question are developed to fit the factual settings, to which they have application.
Question (1): In making a “Reconsideration Decision” which comes after a DLAP, PLAP, and the filing of an appeal to the ARLA, is a Council required to have regard to a “district plan” (however defined), or is that obligation spent by that stage?
[62] Consideration of the Operative Plan(s) is evident, at least in a referential way, in the DLAP and PLAP processes. HNZ submits that “reconsideration” is not a jurisprudential island separated from mainstream considerations which are required to be brought to account in the decision making for a DLAP and PLAP. In the end it is for the Council to decide in what way the District Plan should bear on the decision making if it must have such regard.5
[63] The Supplementary Agenda for the meeting of the Planning Committee on
3 April 2013 included a report on relevant objectives and policies of the two Operative District Plans. The report by the Chairperson of the Planning Committee, dated 8 May 2013 recorded the obligation to have regard to such Operative Plan(s), but goes no further. The Committee’s recommendation was to:
[d]etermine that regard has been given to the matters in s 78(2) of the Act in preparing the draft LAP, namely: …the objectives and policies of its district plan.
[64] This has a somewhat hollow ring to it without evidence of the regard that was had. The law requires sufficient regard that a fully informed decision may be made. HNZ submits that at a meeting of 16 May 2013, when the 8 May 2013 report and recommendations were considered, there was no discussion by the Council of s 78(2) matters, or the objectives and policies of the District Plan. There was reference to
the effects of noise from activities involving the sale of liquor, on the residential
5 Glenharrow Holdings Ltd v Attorney-General [2004] UKPC 42, [2005] 2 NZLR 289 at 304.
neighbourhood, but the objectives and policies of the two Operative Plans did not provide much policy guidance, and the Operative Plans, HNZ says, were outdated.
[65] The Council says the “District Plan”, however defined, applies only to the DLAP and PLAP processes and when a PLAP is before the ARLA by way of appeal the focus narrows to whether an element is unreasonable in light of the object of the SSAA. Mr McNamara submits that this is a discrete exercise and that the obligation to have regard to s 78(2) considerations, whatever they are, is spent. By this route, the Reconsideration Decision, the product of an appeal to the ARLA, does not require any regard to be had to the District Plan. He says that the substance of a LAP, and the policies it may include are contained in s 77 SSAA:
77 Contents of policies
(1) A local alcohol policy may include policies on any or all of the following matters relating to licensing (and no others):
(a) location of licensed premises by reference to broad areas:
(b) location of licensed premises by reference to proximity to premises of a particular kind or kinds:
(c) location of licensed premises by reference to proximity to facilities of a particular kind or kinds:
(d) whether further licences (or licences of a particular kind or kinds) should be issued for premises in the district concerned, or any stated part of the district:
(e) maximum trading hours:
(f) the issue of licences, or licences of a particular kind or kinds, subject to discretionary conditions:
(g) one-way door restrictions.
(2) Paragraphs (a) to (d) of subsection (1) do not apply to special licences, or premises for which a special licence is held or has been applied for.
(3) A local alcohol policy must not include policies on any matter not relating to licensing.
[66] The location of licensed premises in “broad areas”, and the maximum trading hours is pertinent to Victoria Street, and proximity to residential buildings.
Section 75 allows for the application of a LAP to different parts of a district, and different kinds of licence.
[67] Mr McNamara says the only other relevant provisions concerning the
substance of a LAP are ss 93 and 94:
93 Relationship of local alcohol policies and district plans
(1) A local alcohol policy may contain a policy more restrictive than the relevant district plan.
(2) A local alcohol policy does not authorise any thing forbidden by the relevant district plan.
94 Local alcohol policies to be consistent with general law
(4)The appeal before the ARLA is in the interim stayed pending further order of this Court.
(5)Leave is reserved for applications for further directions and orders as necessary to implement this Interim Judgment.
(6) Costs are reserved.
……………………………………
Nicholas Davidson J
Solicitors:
Berry & Co, Oamaru
Simpson Grierson, Auckland
Copy to counsel:
J D K Gardner-Hopkins, Barrister, Wellington
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