Hurunui Water Project Limited v Canterbury Regional Council
[2015] NZHC 3098
•8 December 2015
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
CIV-2015-409-653 [2015] NZHC 3098
UNDER the Resource Management Act 1991 IN THE MATTER OF
an appeal against a decision of the
Environment Court at ChristchurchBETWEEN
HURUNUI WATER PROJECT LIMITED Appellant
AND
CANTERBURY REGIONAL COUNCIL Respondent
AND
AMURI IRRIGATION LIMITED Interested Party
CIV-2015-409-661
UNDER the Resource Management Act 1991
IN THE MATTER OF an appeal against a decision of the
Environment Court at Christchurch
BETWEEN CANTERBURY REGIONAL COUNCIL Appellant
ANDHURUNUI WATER PROJECT LIMITED Applicant
AMURI IRRIGATION LIMITED Interested Party
Hearing: 28 October 2015 Appearances:
A R Galbraith and S Watson for Hurunui Water Project Limited
PAC Maw and P Newland for Canterbury Regional Council
M J Milne as Amicus Curiae
M J Wallace for Amuri Irrigation LimitedJudgment:
8 December 2015
JUDGMENT OF MANDER J
HURUNUI WATER PROJECT LTD v CANTERBURY REGIONAL COUNCIL [2015] NZHC 3098 [8
December 2015]
Contents Background...........................................................................................................[4] The scope of this appeal .......................................................................................[9] Environment Court decision on leave to withdraw an appeal .......................[12]
The Environment Court’s concerns [12]
Environment Court’s ultimate decision on leave [15] Environment Court’s reasoning on leave [17] The consent memorandum procedure [25] The Environment Court widens its jurisdiction [27] The parties are bound by their representations [34] The scheme of the Act for resolving appeals [39] The special position of the respondent [40] Distinguishing Mullen v Parkbrook Holdings Ltd [41] Mullen v Parkbrook Holdings Ltd ...................................................................[43] Overview [43]
Is there a basis to distinguish? [48] Decision on whether leave is required [49] Assessment of Environment Court decision ....................................................[52] Must consent memoranda better achieve the purpose of the RMA? [52]
Is a consent memorandum an abandonment of the CRC’s earlier decision, or
does it render the CRC functus officio? [61]
Does a consent memorandum amount to a representation or undertaking that cannot be resiled from without leave of the Court? [74]
Ability to distinguish Mullen v Parkbrook Holdings Ltd [80] Abuse of process .................................................................................................[82] The abuse of process jurisdiction [83] The Environment Court’s decision on abuse of process [87] Outcome ............................................................................................................ [113]
[1] The Hurunui Water Project Limited (Hurunui) and the Canterbury Regional
Council (CRC) appeal a procedural decision of the Environment Court (the Court).1
The Court held that leave is required before parties may withdraw an appeal in a situation where they have previously lodged a memorandum seeking consent orders. Additionally, the parties appeal the Environment Court’s additional finding that the purported withdrawal of the appeal was nonetheless an abuse of process.
[2] Both parties to the Environment Court proceeding, CRC and Hurunui, have appealed the Court’s rulings. Both contended the Environment Court had erred and each sought a declaration the purported withdrawal was valid. The original appellant, Amuri Irrigation Limited (Amuri), which has an interest in the irrigation of land in the Hurunui catchment and is a shareholder in Hurunui, appeared as an interested party before this Court. It was supportive of the other parties’ appeals.
[3] An amicus curiae, Mr Milne was appointed (as he had been before the Environment Court) to assist the Court in the absence of any party opposing the appeals. While seeking to articulate the approach taken by the Environment Court, Mr Milne could not responsibly resist the merits of the appellants’ submissions. I am grateful for the detailed assistance Mr Milne provided at short notice.
Background
[4] Hurunui is a company established to supply water to a large area of land in North Canterbury. In October 2011, it applied to CRC for resource consents relating to its water project. Amuri and Ngai Tahu Property Limited (Ngai Tahu), which also has interests in the Hurunui catchment, filed submissions about the consent applications. Consents were subsequently granted by Commissioners appointed by CRC.
[5] In August 2013, Amuri filed a notice of appeal against the decision of the commissioners. The parties engaged in mediation, and were occasionally assisted by
an Environment Court Commissioner. Over some 14 months the parties negotiated
1 Amuri Irrigation Company Ltd v Canterbury Regional Council [2015] NZEnvC 164 [Procedural
Decision].
in an effort to resolve the issues between them. Periodic progress reports were filed with the Environment Court
[6] In February 2015, a consent memorandum was filed on behalf of CRC, Hurunui, Amuri and Ngai Tahu seeking orders on the basis of terms they had agreed. It also relevantly provided:
37The parties are satisfied that all matters proposed for the Court’s endorsement fall within the Court’s jurisdiction, and conform to the relevant requirements and objectives of the RMA, including part 2, and request that:
37.1The appeal be allowed to the extent provided by the amended conditions contained in annexure 1 to the draft consent order; and
37.2 The appeal be otherwise dismissed.
[7] Upon receipt of the consent memorandum, the Environment Court issued a series of minutes raising various issues about the course proposed by the consent orders. The parties communicated with the Court over this period in response to the concerns raised. This exchange culminated in August 2015, when Hurunui, Amuri and the CRC filed a joint memorandum advising that a settlement had been reached between them, and that Amuri was withdrawing its appeal. Ngai Tahu, shortly thereafter, advised the Environment Court that it did not wish to take the appeal over
and did not oppose the withdrawal of the appeal.2
[8] In response to that development, the Environment Court raised questions about the propriety of the purported withdrawal of the appeal, and whether the attempt to do so amounted to an abuse of the Court’s process. A hearing was convened to consider these issues. The Environment Court held that a notice of appeal under s 120 of the RMA cannot be withdrawn by consent and without leave after a joint memorandum including proposed consent orders has been lodged with the Court. Further, that the withdrawal by the appellant and/or the failure of CRC to oppose the withdrawal was an abuse of process when the parties had already agreed
the terms of the consent memorandum.
2 Resource Management Act 1991, s 274(5).
The scope of this appeal
[9] An appeal against a decision of the Environment Court is limited to questions of law.3 The principles to be applied are well known, and were summarised by French J in Ayrburn Farm Estates Ltd v Queenstown Lakes District Council:4
[33] An appeal to this Court under s 299 is an appeal limited to questions of law.
[34] Appellate intervention is therefore only justified if the Environment
Court can be shown to have:
(i) applied a wrong legal test; or
(ii) came to a conclusion without evidence or one to which on the evidence it could not reasonably have come; or
(iii) taken into account matters which it should not have taken into account; or,
(iv) failed to take into account matters which it should have taken into account.
[35] The question of the weight to be given relevant considerations is for the Environment Court alone and is not for reconsideration by the High Court as a point of law.
[36] Further, not only must there have been an error of law, the error must have been a “material” error, in the sense it materially affected the result of the Environment Court’s decision.
[10] This Court has recently endorsed this approach to appeals from the Environment Court in St Heliers Capital Ltd v Kapiti Coast District Council by reference to recent decisions of the Supreme Court regarding what amounts to a question of law for appeal purposes.5
[11] The procedural issue as framed by the Environment Court itself, namely whether an appeal can be withdrawn by consent without its leave after a joint memorandum has been lodged, is inherently a question of law. Whether, in the
circumstances, the withdrawal by Amuri or the failure by CRC to oppose the
3 Section 299.
4 Ayrburn Farm Estates Ltd v Queenstown Lakes District Council [2012] NZHC 735, [2013] NZRMA 126 (footnotes omitted).
5 St Heliers Capital Ltd v Kapiti Coast District Council [2015] NZHC 896, citing Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721 at [24]-[27]; R v Gwaze [2010] NZSC 52, [2010] 3 NZLR 734 at [50]; Vodafone New Zealand Ltd v Telecom New Zealand Ltd [2011] NZSC 138, [212] NZLR 153 at [51].
withdrawal was capable of constituting an abuse of process gives rise to a question of law. Both issues involve an examination of the correctness of the legal test applied, whether it was correctly applied and the approach taken by the Environment Court to its examination of those questions. Each of those issues potentially engages the various heads which may give rise to an error of law.
Environment Court decision on leave to withdraw an appeal
The Environment Court’s concerns
[12] The Environment Court identified what it described as “the essential facts of concern for [its] procedural decision”.6 It observed that after the parties had lodged their joint memorandum seeking consent orders to amend the resource consents, the Court had questioned the lawfulness of some of the consents, the workability of others, and what new data relating to nutrient loads for the Hurunui catchment entailed for the proposed consents. The Court stated it had not at that stage rejected or accepted the consent memorandum, but was proposing to hear from the parties to be satisfied the orders being proposed were satisfactory.7
[13] Against that background, a further stated “fact of concern” for the Environment Court was that the parties had then lodged a joint memorandum, by which Amuri purported to withdraw its appeal with the consent of Hurunui and CRC.
[14] It is apparent from the Court’s decision that it was particularly concerned about the levels of additional nitrogen contributed to the catchment each year by farming.8 Specifically, the permissible discharge of nitrogen and phosphorous, and
whether the scheme proposed by Hurunui would exceed these limits.9 On the
hearing of the appeal to this Court, submissions were made by Hurunui and CRC that the Environment Court has misinterpreted information regarding this issue, and this had led to unfounded concerns regarding the efficacy of the nutrient levels
proposed for the Hurunui catchment. For the purposes of this appeal against what
6 Procedural Decision, above n 1, at [42].
7 At [42](1)-(5).
8 See for example at [26]-[37].
9 At [36].
are jurisdictional rulings, it is neither possible nor necessary for this Court to resolve that question, but plainly it was an issue of concern to the Environment Court.
Environment Court’s ultimate decision on leave
[15] In addressing the first question, whether an appeal can be withdrawn after a consent memorandum has been lodged, the Environment Court traversed the scheme of the Resource Management Act 1991 (RMA), its powers under that legislation, and the methods of resolving an appeal.10 From that analysis a series of conclusions were drawn by the Court, upon which it relied to reach its ultimate decision regarding the question of leave. Namely that the otherwise binding authority of the Court of Appeal’s decision in Mullen v Parkbrook Holdings Ltd was distinguishable.11
[16] Because of the way the Environment Court built on a series of conclusions to reach its ultimate finding that the parties required its leave before withdrawing the appeal, and that to do so without such leave amounted to an abuse of its processes, it is necessary to traverse the Environment Court’s reasoning at some length.
Environment Court’s reasoning on leave
[17] The Environment Court referred to the relative unusualness of a tribunal appealed from being a party to an appeal.12 It quoted Cooke P in Goodman Fielder Ltd v Commerce Commission to the effect that considerations of public interest and the effective administration of an Act may justify a judicial body being party to a proceeding, particularly where no other party is available to put those considerations adequately before the appellate Court.13 The Environment Court observed that the RMA contemplates the consent authority being identified as a respondent, and that public interest considerations arise in such a setting.14 As a result, it concluded that
“normal general law concepts concerning two adversaries do not apply very readily”,
10 At [44]-[82].
11 At [96]-[99], distinguishing Mullen v Parkbrook Holdings Ltd [1999] NZRMA 23 (CA).
12 At [48].
13 At [48], citing Goodman Fielder Ltd v Commerce Commission [1987] 2 NZLR 10 (CA) at 13 and 20.
14 At [48].
particularly where the resource consents in consideration involve the allocation of resources or rights, as in the present case.15
[18] The Court then observed that the RMA encourages proceedings to be resolved by agreement, and makes provision for alternative dispute resolution processes to facilitate resolution.16 The Act itself does not expressly provide a mechanism for formal orders to put that agreement into effect, however, there is now a well-established process to obtain consent orders which is regulated by a practice note.17
[19] The Environment Court noted the powers available to it to resolve an appeal are set out in s 290 of the RMA.18 The Environment Court has the same “power, duty, and discretion” in respect of a decision appealed against, “as the person against whose decision the appeal is brought”. The Environment Court sought to emphasise that a substantive hearing before it is not an appeal in a “traditional sense”.19 The Court considered there was an absence of recent authority regarding that proposition.20 It referred to a decision relating to the Town and Country Planning Act 1953, in which the Court of Appeal emphasised that an appeal under that statute to the Town and Country Planning Appeal Board “really amounts to an investigation de novo”.21
[20] In that case, the Court of Appeal, after referring to the Board retaining all the powers, duties, functions and discretions of the body appealed from, opined that it was able, if it wished, to exercise an original jurisdiction to give consent and, if “the appeal is still alive”, the Board would have that power to exercise as it deemed appropriate.22 As an aside, the Environment Court, while placing some weight on
these observations, did not refer to the fact that the Court of Appeal’s observations
15 At [50].
16 At [51].
17 At [51], referring to the procedure set out in the Environment Court of New Zealand Practice
Note 2014.
18 At [54].
19 At [55].
20 At [55].
21 At [55], citing Ross v Number Two Town and Country Planning Appeal Board and Others
[1976] 2 NZLR 206 (CA) at 210.
22 Ross, above n 21, at 210.
were premised on the appeal being “still” live before the Planning Appeal Board would have the power to exercise an original jurisdiction if it deemed it appropriate.
[21] That observation notwithstanding, there is more recent and authoritative statements that the Environment Court on appeal may examine the issue before it afresh. In Waitakere City Council v Estate Homes Ltd the Supreme Court held:23
… The notice must state the reasons for the appeal and the relief sought. Under s 290(1), the Environment Court has “the same power, duty, and discretion” in dealing with the appeal as the consent authority. Under s 290(2) it may confirm, amend or cancel the decision to which the appeal relates.
These statutory provisions confer an appellate jurisdiction that is not uncommon in relation to administrative appeals in specialist jurisdictions. As Mr Neutze submitted, they contemplate that the hearing of the appellate tribunal will be “de novo”, meaning that it will involve a fresh consideration of the matter that was before the body whose decision is the subject of appeal, with the parties having the right to a full new hearing of evidence. When the legislation provides for a de novo hearing it is the duty of the Environment Court to determine for itself, independently, the matter that was before the body appealed from insofar as it is in issue on appeal. The parties may, however, to the extent that is practicable, instead confine the appellate hearing to specific issues raised by the appeal.
[22] Two points are to be noted from the Supreme Court’s reasoning. Firstly, echoing the Court of Appeal in the previous Town and Country Planning Act case, the jurisdiction of the Environment Court on appeal to examine the matter independently for itself is qualified by the words “insofar as it is in issue on appeal”. The parties may therefore confine the appellate hearing to specific issues raised by the appeal. Secondly, the conferral of this type of appellate jurisdiction is not
uncommon to administrative appeals in specialist jurisdictions.24 Such an appellate
role is not unique to the Environment Court.
[23] The Environment Court stated that it was bound to apply s 104 of the RMA.25
This requires a consent authority when considering an application for a resource consent, to have regard to the effects on the environment of allowing the activity and
relevant provisions of various environmental policy statements, national
23 Waitakere City Council v Estate Homes Ltd [2006] NZSC 112, [2007] 2 NZLR 149 at [27]-[28] (citations omitted).
24 See Shotover Gorge Jet Boats Ltd v Jamieson [1987] 1 NZLR 437 (CA) at 440.
25 Procedural Decision, above n 1, at [56].
environment standards, regional policy statements, plans and regulations. From that statutory imperative, the Environment Court concluded that a consent authority, and on appeal, the Environment Court, was not simply to adjudicate between the parties but also to achieve the purpose of the RMA.26 In that regard, the Court observed that RMA proceedings are usually prospective, rather than retrospective, looking as they do at future conduct, rather than what has occurred in the past.27 From that observation, the Environment Court concluded that it was potentially in a more advantageous position on appeal than the consent authority at the time that it made its decision.28
[24] An apparent corollary of this observation was that the purposes of the Act could be better advanced by the Court, making its own decision informed by new information. It is apparent the Environment Court considered this a relevant consideration in the circumstances of the present case. It observed that when Commissioners conducted their hearing in 2013, its decision was based on evidence of Hurunui nutrient loads from 2006-2011.29 In the consent memorandum lodged by the party, another four years of data was available to the CRC in respect of which the Environment Court set out its interpretation.30
The consent memorandum procedure
[25] The Environment Court considered the consent order procedure which has developed as a matter of practice under the RMA. There is no express provision for consent orders under the RMA, notwithstanding the RMA’s encouragement to resolve proceedings by agreement without the need for a formal hearing.31 As previously observed, the RMA does not provide any explicit mechanism by which out of Court resolutions can be given effect to. This difficulty has been overcome by the Environment Court’s practice note of 2014.32 This provides consistency and formality to the practice of resolving proceedings by agreement by referring the
settlement to a Judge with a request to issue a consent order. Initially, this was the
26 At [56].
27 At [57].
28 At [57].
29 At [58].
30 At [58].
31 At [63].
32 At [64]-[66], referring to the Environment Court of New Zealand Practice Note 2014.
course being followed by the parties in respect of the appeal before the Environment
Court.
[26] Upon receipt of consent memoranda, the Environment Court will need to review the terms of the draft consent orders to ensure they are workable, and that they comply with the RMA and relevant plans. In the absence of any concerns, a consent order will be issued. Should some issue arise it can be identified and referred back to the parties for consideration.33 It is axiomatic from the fact orders are being sought from a Court that it is under no obligation to make any order unless satisfied that it is appropriate to do so. The issue that arises on the present appeal, however, is whether the Court can insist on retaining the matter against the wishes of
all the parties who no longer seek the Court’s endorsement of the proposed draft
orders.
The Environment Court widens its jurisdiction
[27] The Court proceeded to consider the requirement contained in s 290A of the RMA that the Court is to have regard to the “decision” under appeal.34 The Court considered this provision to be “an important change to the RMA”.35 It considered the Court has to rely on “a consent memorandum, not just as submissions, but as providing undertakings on which the Court can place sufficient weight to replace the
decision by the consent authority”.36 The description of the consent memorandum as
providing undertakings requires scrutiny and is the subject of focus later in this judgment.
[28] The Environment Court then made observations about the effect of a consent authority executing a consent memorandum. It held that once the consent authority executes the consent memorandum, its original decision “is effectively gone”.37 The Court considered the CRC to be bound by its “new decision”, as recorded in the
consent memorandum.38 While acknowledging that the consent authority’s “new
33 At [69].
34 At [59].
35 At [59].
36 At [59] (emphasis added).
37 At [70].
38 At [70].
decision” is subject to the Environment Court’s approval or endorsement, the Court clearly categorises the consent authority’s agreement to the making of the consent order as being a “decision”.
[29] The Environment Court further observed in reference to a consent memorandum, that the Court needs to be able to rely on the consent memorandum to satisfy itself that the mandatory considerations under s 104 of the RMA are met in a way that better achieves the purpose of the RMA.39 The Environment Court stated that it is for this reason, namely its reliance on the consent memorandum that it “better achieves” the purpose of the legislation, that the Court’s Practice Note requires the parties to be satisfied that “… all matters proposed for the Court’s endorsement … conform to relevant requirements and objectives of the Resource Management Act, including in particular Part 2”.40 This construct that the consent memorandum “better” achieves the purpose of the RMA than the original decision as a reason for requiring leave requires close examination.
[30] The Environment Court acknowledged the existence of a right to withdraw an appeal.41 It also acknowledged the general rule that an appeal may be withdrawn or abandoned without leave at any time before the hearing or release of the decision.42
However, when a consent memorandum has been filed it considered this general rule no longer has application.
[31] In reliance on dicta by Lord Denning MR and Lawton LJ in Hanson v Church Commissioners for England, the Court noted that there may be special circumstances warranting an exception from allowing parties to decide for themselves whether they
wish to withdraw a proceeding.43 The Environment Court then observed:44
39 At [71].
40 At [71].
41 At [72]. See for example Resource Management Act 1991, ss 116(1), 272 and 285.
42 At [74], citing Mullen v Parkbrook Holdings Ltd [1999] NZRMA 23 (CA). See too Parkbrook Holdings Ltd v Auckland City Council & Anor [1999] NZRMA 10 (HC); R v Hampstead & St Pancras Rent Tribunal, ex p Goodman [1951] 1 KB 541 (District Court); Hanson v Church Commissioners for England [1978] QB 823 (CA); Re Queensland Nickel Management Pty and
Great Barrier Reef Marine Park Authority and Others (No 3) (1992) 28 ALD 368 (AAT); R v
Blackburn Ex parte Transport Workers Union of Australia (1953) 88 CLR 125;Schipp v
Herfords Pty Ltd [1975] 1 NSWLR 412 (NSWCA).
43 At [77]-[79], citing Hanson v Church Commissioner for England [1978] QB 823 (CA), at
832,835 and 839.
44 At [78].
… What is interesting about the situation where the parties have already lodged a consent memorandum is the parties have decided what they want – the terms are stated in the consent memorandum. Is it in the public interest to let them resile from it? Or perhaps more accurately, does it achieve the purpose of the RMA and of the plans particularising that purpose to let them resile from the form of resource consents in a consent memorandum which, by implication, better achieves the purpose of the Act than the originals.
[32] The Court continued:
[79] Further, as we have said, there is a more fundamental difficulty: The respondents “satisfaction” that the consent memorandum achieves the purpose of the Act (and by implication the relevant regional plan) means that the consent memorandum is, in effect, a new decision subject to the endorsement of the Court under s 279(1)(b) or s 290 RMA. Having agreed to a consent memorandum, the consent authority really is functus officio. It can take no further action unless directed by the Court.
[33] The Environment Court then proceeded to directly address the issue of whether the purported withdrawal of the appeal by the parties after a consent memorandum has been lodged was valid. The Environment Court concluded that notwithstanding the general rule that parties are normally free to withdraw or abandon an appeal, and notwithstanding the Court of Appeal’s decision in Mullen, the filing of the consent memorandum had the effect of requiring leave.45 Its essential reasoning for reaching this conclusion was broken down under the following headings.46
The parties are bound by their representations
[34] The Environment Court concluded the parties to the consent memorandum have jointly made a specific representation to the Court that the conditions in the draft consent order “… fall within the Court’s jurisdiction” and that the conditions “… conform to relevant requirements and objectives of the RMA…”.47 The Court concluded it follows that the consent memorandum contains a presentation by the parties that they have agreed on the proposed conditions meeting the purpose of the
RMA.
45 At [99].
46 One head is not addressed. Under the hearing “The role of the Environment Court: All or nothing” the Court responded to a submission of Hurunui that the Court’s role on receipt of consent memorandum is to accept or reject the memorandum with no middle ground. The Court’s rejection of the submission does not add to the Court’s analysis.
47 At [88].
[35] There is nothing novel in those observations which follow from the face of the statements. However, the Environment Court considers the inevitable implication of the parties representations is that they believe the proposed conditions better meet the purpose of the RMA than the original conditions.48 The Environment Court reaches this position by a series of suppositions. Firstly, because Amuri’s appeal alleged that Hurunui’s proposal will result in a substantial increase in nutrients being released into the Hurunui catchment.49 The Environment Court infers therefore that Amuri would have been very unlikely to have acceded to consent orders which did not address that situation. Secondly, the Court believes that Hurunui’s agreement contained in the consent memorandum effectively concedes that the original conditions can be improved.50 Thirdly, that CRC, as the respondent, had a duty to choose the better set of conditions in the light of any new information at the time of its approval of the changes.51
[36] On the Court’s analysis, the representations were made to induce the court to rely on the consent memorandum and make consent orders.52 Because the consent memorandum was intended to be a document the Court could rely on, the Environment Court stated that “[o]n this simple ground alone we consider that the putative withdrawal by [Amuri] of its appeal is invalid unless leave is obtained”.53
The Environment Court considered an alternative way of analysing the situation is to consider the consent memorandum to effectively be an agreed “interim decision” which “simply” requires endorsement by the Court.54 It follows, says the Environment Court, that consequently withdrawal is no longer possible without the leave of the Court.55
[37] Earlier in its decision, the Court had discussed the place of interim decisions and their interplay with the ability to withdraw an appeal.56 The Court noted the
practice of the Environment Court to release an interim decision, pending
48 At [89].
49 At [89](1).
50 At [89](2).
51 At [89](3).
52 At [90].
53 At [90].
54 At [90].
55 At [90].
56 At [61]-[62].
finalisation of conditions.57 It observed that “[r]eserving leave for submissions or evidence on the detail of conditions does not mean that there is not a decision, so that an appellant can withdraw”.58 The observation is an unsurprising one, however, it appears some analogy is sought to be drawn with the consent memorandum procedure.
[38] The Court appears to have considered it significant that the illegitimacy of parties negotiating a private arrangement after receiving such an interim decision, and then attempting to withdraw, with the effect of restoring the original (pre-appeal) conditions, is comparable to the consent memorandum process. Clearly, it is not. The reason such a course is no longer available to the parties is because the Court has proceeded to a full hearing and issued a substantive decision on the merits.59 As is self-evident, in the present case the Environment Court has made no decision, and the utility of the analogy ends there.
The scheme of the Act for resolving appeals
[39] The Court observed that for the Court to “have jurisdiction” the appellant is not needed “in more than a nominal sense”.60 The parties have resolved their difference by agreement. According to the Environment Court, the parties role in the appeal is therefore at an end, except to the extent they may be invited by the Court to address any matters to satisfy the Court in respect of the proposed consent orders.61
The Court concludes that this analysis does not infringe the principles that no party should be forced to litigate against their will and, secondly, that it is preferable to let parties in an adversarial situation resolve their differences by themselves where possible.62
The special position of the respondent
[40] The Court found that “technically a consent authority is functus officio when
it has issued its decision”, however, it acknowledged a consent authority is permitted
57 At [61].
58 At [61].
59 Re Auckland City Council (as successor to Rodney District Council) [2011] NZEnvC 386.
60 Procedural Decision, above n 1, at [92].
61 At [92].
62 At [91].
to be involved in a resource consent appeal.63 Notwithstanding that latitude, the Environment Court considered it was entitled to assume the consent authority had considered the amended consents and conditions contained in the consent memorandum carefully before deciding to change them, and must have concluded that the relevant plan is better achieved as a result.64 It followed, on the Environment Court’s analysis, that the consent authority’s position is different from that of other parties. Permitting the consent authority to resile from its original quasi judicial decision by lodging the consent memorandum must have been on the basis that its endorsement of the proposed consents contained in the consent memorandum are preferable to its first instance decision.65
Distinguishing Mullen v Parkbrook Holdings Ltd
[41] The Environment Court held that the authority of Mullen, which concluded that leave is not required from the Court to withdraw an appeal in the absence of opposition from a party or an abuse of process, does not have application if a consent memorandum has earlier been lodged with the Court.66
[42] The Environment Court concluded that Mullen can be readily distinguished on the grounds that it did not involve a consent memorandum.67 Alternatively, because of the post-Mullen introduction of s 290A of the RMA, requiring the Environment Court on appeal to have regard to the consent authority’s decision, the Court of Appeal’s judgment is able to be distinguished.68 The Court, having concluded the consent memorandum must be “better” or “outweigh” the first instance decision, appears to be of the view that the introduction of s 290A is of significance.69 Quite why that provides a basis upon which to distinguish Mullen remains opaque. Possibly it relates to the characterisation of the consent memorandum as a “decision” by the consent authority which the Court is now
obliged to have regard to under s 290A.
63 At [94].
64 At [95].
65 At [95].
66 At [96].
67 At [96]-[97].
68 At [97].
69 At [97].
Mullen v Parkbrook Holdings Ltd
Overview
[43] It is convenient at this stage to review the Court of Appeal’s decision in Mullen which, but for the Environment Court’s analysis, would otherwise be binding authority on the Environment Court and, indeed, this Court in its approach to the present issue. Its centrality to the issue of leave is best demonstrated by the introductory paragraph of the judgment of the Court, delivered by Tipping J, which identifies the broad nature of the issue addressed by the Court of Appeal in that
case:70
The general issue in this appeal is what, if any, restrictions exist on the ability of appellants in the Environment Court to abandon or withdraw their appeal. Related and more specific issues are whether the leave of the Environment Court is in any circumstances necessary before an appeal can be withdrawn or abandoned and whether persons who have rights of audience under s 274 of the Resource Management Act 1991 (the Act) may become appellants, or may otherwise require the proceedings to continue for their benefit when the original appellant has abandoned or withdrawn the appeal.
[44] In that case, the Auckland City Council granted a resource consent to Parkbrook to erect a multi-storey building. The owners of adjacent land appealed. Parkbrook and the owners of the adjacent land came to an agreement regarding the resolution of the appeal, and they sought its withdrawal. Mr Mullen was also a neighbour to the development site. He sought a right of audience in respect of the appeal and opposed the withdrawal of the appeal on the basis of his interest as a neighbouring landowner wishing to oppose the development. As a result, the Environment Court declined to grant leave to withdraw the appeal.
[45] On appeal to this Court, Salmon J held that, in the absence of the withdrawal amounting to an abuse of process, there was no basis to interfere in the appellant’s right to withdraw its appeal. The Court of Appeal agreed with the High Court, holding there were no grounds upon which the Environment Court could resist withdrawal of an appeal unless there was an abuse of process. By reference to the
scheme of the RMA, the Court of Appeal held as follows:71
70 Mullen v Parkbrook Holdings Ltd [1999] NZRMA 23 (CA).
71 At 30 (emphasis added).
On the basis of the provisions discussed, it seems clear enough that the Act does not require leave to be granted before an appeal can be withdrawn or abandoned. Indeed, the converse is implicit, namely that there is a right to withdraw or abandon without leave. The only fetter on that right is the general power of the Court to prevent its processes from being abused. An abandonment or withdrawal may therefore be set aside or otherwise negated if it amounts to an abuse of process. …
[46] Under the heading “Policy considerations”, the Court of Appeal continued:72
The issue in the present case is essentially whether the Environment Court may keep an appeal on foot despite the wish of the appellant to withdraw without opposition from other parties. Here we are using the words “parties” in its proper statutory sense, which does not include someone with a right of audience under s 274. In the present case, the parties were Mr McLean and Ms Stirrup as appellants, and the Council as respondent. Mr Mullen was not a party. If all parties consent to, or do not oppose, the intended withdrawal of the appeal, it can hardly be right that the Court can insist on the case proceeding because it has some perception of a contrary public interest. In such a situation, the case would presumably have to proceed quite some distance before the Court could discern whether whatever had caused it to refuse leave to withdraw had any validity. How would such proceedings be conducted? Who would pay the costs of parties having no wish to proceed? Could the Court require evidence to be called and cross-examination to take place against the wishes of the parties? Could a party be forced to call evidence? What if the parties simply withdrew? The Environment Court is not constituted a commission of inquiry. It could hardly act as a Court, holding the scales evenly between competing parties, if there were no such parties and no remaining disputes.
[47] The Court of Appeal concluded that “whichever way one looks at the issue, the indications are in favour of an appellant having a right to withdraw or abandon the appeal subject only to that course not being an abuse of process”.73
Is there a basis to distinguish?
[48] The Environment Court held that, because a consent memorandum was filed by the parties, the Court of Appeal’s analysis in Mullen does not have application. It is therefore necessary to examine the purported bases on which the Environment Court relied to allow it to conclude Mullen was not binding authority. Before undertaking that exercise, the following observations are relevant to the potential
application of Mullen to the present case:
72 At 34 (emphasis added).
73 At 36.
(a) The Court of Appeal’s discussion in Mullen was framed in general terms. It was not confined to the specific facts of the case before it. The conclusion it reached was after an examination of the scheme of the RMA. It did not include the consent memorandum process but, of course, as we have seen, the RMA does not expressly provide for that process. Mullen is not fact specific; it follows that the presence of different facts in the instant case is not a basis upon which Mullen can be distinguished. It can only be as a matter of law that the filing of the consent memorandum has the effect of requiring leave.
(b)The facts of Mullen appear to be capable of providing a surer footing to refuse leave to withdraw than the present case. It was not disputed that Mr Mullen had a right of audience and a legitimate interest under s 274 of the RMA. He opposed both the development and the withdrawal of the appeal. Unlike in Mullen, no entity in the present case, be they a formal party to the appeal or an interested party, including the s 274 party, Ngai Tahu, opposed the appeal, nor its withdrawal.
(c) The Environment Court’s reliance on the amendment of the RMA incorporating s 290A as a basis to distinguish Mullen, is unsustainable. Even if the Environment Court’s interpretation of the term “decision” is interpreted as referring to the consent authority’s stance at the time of the filing of the consent memorandum, it is not clear how that statutory duty affects the reasoning set out by the Court of Appeal in its approach to the issue of withdrawal. On the other hand, if the Court’s reference to s 290A relates to the original decision, it is axiomatic that there must be a live appeal for the obligation to trigger. The very essence of withdrawal is extinguishment of the appeal. Absent the circumstance of the filing of consent memoranda, the Environment Court’s analysis would have application to any appeal before it, thereby requiring it, under s 290A, to have regard to every decision the subject of an appeal before
permitting withdrawal, with or without a consent memorandum having previously been filed.
(d)In any case, while the Environment Court correctly observes that s 290A was not introduced in the RMA until 2005, the section simply reflected the current state of the law. In Waitakere City Council v Estate Homes Ltd, the Supreme Court observed that legislation providing for de novo appeals has never been read as permitting the appellate tribunal to ignore the opinion of the tribunal whose decision
is the subject of appeal.74 Specifically in relation to the planning
context, the Supreme Court noted the decision of the local authority will almost always be relevant because of the authority’s general knowledge of the local context in which the issue arises. In making this observation the Supreme Court cited s 290A introduced the previous year which now required the Environment Court in determining an appeal to have regard to the decision the subject of the appeal.
(e) It is clear the legislative changes to s 274 since Mullen was decided have no bearing upon its continued relevance and application. While there is now capacity for a person to become a party under s 274, it is of no relevance in the present case. No party or s 274 submitter took issue with the withdrawal. If a s 274 party did, in fact, oppose withdrawal, then that would alter that situation. The Court of Appeal in Mullen clearly recognised that situation, but that is not the case here.
Decision on whether leave is required
[49] It is worth pausing to consider the import of the Environment Court’s analysis. Such is the status and effect of consent memoranda, the Court of Appeal’s decision in Mullen is distinguishable notwithstanding its intended general
application. By filing a consent memorandum, the Environment Court becomes
74 Waitakere City Council v Estate Homes Ltd [2006] NZSC 112, [2007] 2 NZLR 149 at [29], citing Coutts Cars Ltd v Baguley [2002] 2 NZLR 533 (CA) at [4].
seized of a new jurisdiction which, in the absence of consent memorandum having been filed, it does not otherwise possess. Notwithstanding the absence of any statutory authority, where the parties have recorded their agreed resolution of the issues between them in a consent memorandum for the purpose of obtaining orders from the Court, the memorandum cannot be withdrawn without leave, nor the appeal itself. Further, the respondent consent authority is estopped from consenting to any such withdrawal.
[50] The Environment Court held that the filing of a consent memorandum amounts to such a special circumstance that the parties ought not be the arbiter of whether the appeal should be heard, or not. That special circumstance warrants the Court, as guardian of the public interest, intruding on the rights of the parties to
determine the fate of their own proceeding.75 The following findings can be
discerned as being critical to the Court’s conclusion that after a consent memorandum has been filed leave is required. They are as follows:
(a) The consent memorandum is a representation that the consented terms were “better” than the terms of the original decision by the consenting authority;
(b) The consent memorandum constitutes an abandonment by the CRC of
its original decision, and a new “decision” by it;
(c) The consent memorandum renders the CRC functus officio, and therefore unable to take any subsequent steps without leave of the Court; and
(d)The signing and filing of the consent memorandum was a representation and/or undertaking that meant it could not be withdrawn without leave of the Court.
[51] The Environment Court’s conclusion that leave is required to withdraw an appeal after the filing of a consent memorandum is premised on these findings. Each
75 Hanson v Church Commissioners for England [1978] QB 823 (CA) at 839.
requires close examination. I address these previously unrecognised propositions in turn.
Assessment of Environment Court decision
Must consent memoranda better achieve the purpose of the RMA?
[52] The Environment Court held that the lodging of consent memoranda amounts to a special circumstance warranting interference with the right to withdraw because the consent memorandum implicitly must “better” achieve the purpose(s) of the RMA.76 The Environment Court held that it would not allow the parties to resile from the consents proposed in a consent memorandum which “by implication better achieves the purpose of the Act than the originals”.77 In so holding, the Environment Court effectively introduces a new rationale for precluding appellants from withdrawing appeals. Because the consent memorandum is said to better advance the purposes of the RMA, the public interest requires the Court to insist on leave being sought before the appeal can be withdrawn.
[53] The relevant component of the “standard Environment Court form of consent order” provides as follows:78
[4] The Court is making this order under s 279(1)(b) of the Act, such order being by consent, rather than representing a decision or determination on the merits pursuant to s 297. The Court understands for present purposes that:
(a) …
(b) All parties are satisfied that all matters proposed for the Court’s endorsement fall within the Court’s jurisdiction, and conform to relevant requirements and objectives of the Resource Management Act, including in particular Part 2.
[54] Nothing in that directive requires the consent memorandum to better achieve the purpose of the RMA. It provides that a certain threshold must be attained. Namely, that the matters proposed conform with the objectives of the RMA and must
be within the jurisdiction of the Court. What is meant by the Environment Court
76 Procedural Decision, above n 1, at [71], [78], [89], 95].
77 At [78].
78 Principal Environment Judge R J Bollard “Editorial: Standard Environment Court Form of
Consent Order”, Environment Court of New Zealand.
from its requirement that the conditions contained in the consent memorandum be “better” is not immediately clear. A different set of conditions may equally be conducive to the fulfilment of the RMA’s objectives.
[55] While the Environment Court considers it implicit that the new conditions contained in the consent memorandum are “better”, it appears to arrogate to itself the assessment of what is “better”, notwithstanding the alternative dispute mechanisms the statute encourages parties to employ to achieve their own resolutions. The consent authority remains central to that process of resolution, and continues to have responsibility for the efficacy of the conditions of any renegotiated consent. There is no requirement in the statute or regulation that a consent memorandum must “better” achieve the purpose of the RMA, nor that those objectives cannot be met in a number of ways, each of which may differ. In many situations there can be no objective measure of “better”.
[56] If there was a requirement that the conditions be “better” than those contained in the original decision, then it is difficult to foresee how any negotiated settlement of appeals relating to the imposition of conditions could ever be resolved short of a hearing. An applicant may consider conditions to be too stringent, or to be prohibitively expensive, when regard is had to the effects the conditions seek to mitigate. After further consideration, a consent authority may reconsider its position in relation to those conditions and agree the objectives of the RMA can still be achieved by relaxing their strictness. Taken to its logical conclusion, the Environment Court’s approach could result in perverse outcomes. It directly conflicts with what is sought to be achieved by the practice note and the RMA to encourage parties to resolve issues by alternative dispute resolution.
[57] Mr Milne as amicus submitted the Environment Court had cited no authority for the proposition that the matters to be considered by it under s 104 are to be met in a way that better achieves the purpose of the RMA. Nor, as he observed, is there mention of any such requirement in the Court’s practice note, the standard consent order, or the then Principal Environment Court Judge’s explanation of the consent order process. Mr Milne submitted that such a test would be incapable of being met in many instances, and that all that would be required to invoke the Court’s claimed
jurisdiction requiring leave, was that the provisions proposed were different to the original consent conditions. Mr Milne stressed that a mediation settlement is a compromise. Any comparison of whether the proposed settlement is better than the terms of the decision appealed against to give effect to the purpose of the RMA, would mean that most settlements would simply not pass the “better” test.
[58] Mr Milne submitted the correct legal position is that the proposed settlement must be evaluated on its own merits in terms of whether it achieves the purpose of the RMA. If it does achieve the purpose of the RMA and there is an appropriate rationale for departing from the consent authority’s original decision, there is no reason the settlement cannot be approved by the Court.
[59] I have concluded the Environment Court was in error to hold that the consent memorandum must provide “better” terms than the first instance decision. I do so for the following reasons:
(a) The “standard Environment Court form of consent order” makes no reference to a requirement that the consent memorandum must “better” achieve the purpose of the RMA. The requirement is simply that the purpose be achieved. Nor is there reference to such a requirement in the explanatory material to the standard form, nor the Environment Court Practice Note 2014.
(b)A requirement that the consent memorandum be “better” has potentially serious consequences for the settlement process as a whole under the RMA. If the Environment Court’s approach was adopted across the board, it would be rare that settlement could proceed by way of consent memorandum. The ethos of settlement is that the parties come to a compromise. By necessity, if one party cannot make a concession from the ground it occupied at first instance, it is extremely difficult to ascertain how any compromise could ever possibly be reached.
(c) The consent authority is the primary entity responsible for ensuring compliance with the RMA, including to ensure its purpose is achieved. It has responsibility for assessing and determining whether proposals do or do not conform to its requirements and objectives. There is no sole method of achieving the purpose of the RMA, which inherently involves the assessment of an evaluative threshold. In the present case, there was no evidence before the Environment Court suggesting the CRC had repudiated its original decision when it signed the consent memorandum. The CRC continued to support its decision to grant consent to Hurunui. CRC’s position is that while the consent memorandum contains different conditions to those imposed at first instance, it is satisfied they work in accordance with its duties and functions under the RMA as well as those proposed at first instance.
(d)The Environment Court concludes that it is implicit in a consent authority agreeing to a consent memorandum that it provides for “better” conditions, from which it cannot be allowed to resile. However, there is no reliable basis upon which the Environment Court can draw that inference from the fact a consent memorandum has been lodged.
(e) As has already been observed, should this requirement be upheld, it would be intolerably ambiguous. Who determines what amounts to “better”? From which perspective is “better” determined? Such a descriptor will always be relative both in temporal terms and as a matter of perspective.
[60] It follows therefore that the Environment Court was wrong to hold the consent memorandum must contain terms which “better” achieve the purpose of the RMA than the first instance decision. Such an approach has the capacity to undermine parties being able to reach settlement agreements inter partes, as the RMA seeks to encourage.
Is a consent memorandum an abandonment of the CRC’s earlier decision, or does it
render the CRC functus officio?
[61] The Environment Court held that once the consent authority executes the consent memorandum “the first instance decision is effectively gone” and it is “bound by its new decision as recorded in the consent memorandum”.79 The Court held that the consent authority’s satisfaction that a consent memorandum achieves the purpose of the Act means the consent memorandum is, in effect, a “new decision”, and that it “really is functus officio”.80 In such a situation the Environment Court held the consent authority can take no further action unless directed by the Court.
[62] Effectively, the Environment Court seeks to inflate a position taken by the consent authority in respect of an appeal into a new decision, which is to be taken as effectively extinguishing its previous decision regarding the consent. Mr Milne was unable to present any argument in support of the Environment Court’s proposition. He referred to how a settlement position may have private law contractual status and be enforceable by the other parties, but that in public law terms the settlement position has no legal effect whatsoever. I agree. Until the Environment Court is prepared to issue orders giving effect to the communicated position of the parties, including that of the consent authority, the settlement position has no legal effect, save potentially between the parties to the settlement agreement.
[63] Mr Milne considered whether some form of estoppel may apply based upon an express or implied representation contained within the consent memorandum. However, the obvious question arises as to who could be said to have detrimentally altered their position in reliance upon the representation. Mr Milne suggested perhaps the Environment Court had invested time and effort in considering the proposed consent order. However, as he rightly observed, how could that be any different from the situation where a hearing has actually been conducted and the
appeal withdrawn before the decision given, which was accepted by the Court of
79 At [70].
80 At [79].
Appeal in Mullen, and, indeed, recognised by the Environment Court itself, as being a course available to the parties in the absence of an abuse of process.81
[64] The legal position is clear, a consent authority has no statutory power to make a new decision in respect of a consent application, save as to very limited circumstances where a consent authority may correct minor mistakes or defects in the consent, and circumscribed situations where an applicant or consent holder can object to a consent authority.82 The difficulty with the alternative dispute resolution processes available to parties under the RMA was that there was no mechanism to give effect to any negotiated resolution. The introduction of the consent order process was designed to avoid that difficulty. Only the Environment Court can make
orders changing the original decision of a consent authority.
[65] The consent authority itself cannot, by agreeing on a revised approach, change the effect of its original decision. It follows therefore that no decision is made by a consent authority when it signs a consent memorandum. All the authority is doing is formally setting out its position. It remains for the Court as to whether it is willing to make orders in accordance with the statutory powers that it has on appeal to alter a consent authority’s decision.
[66] The concept that a consent authority is rendered functus officio at the point in time that it signs a consent memorandum does not withstand scrutiny when regard is had to the consent order process as a whole. It is not uncommon for the Environment Court, having received consent memoranda, to ask the consent authority to consider modifications to what is being proposed. It is difficult to envisage how a consent authority could reconsider the refinement of conditions proposed in the consent memorandum if it is functus officio.
[67] Similarly, if the Environment Court rejects the proposal agreed to by the parties in the consent memorandum and the matter proceeds to a full hearing, it cannot follow that a consent authority is bound by the position it took in the consent
memorandum. Logically, following the approach taken by the Environment Court,
81 Mullen v Parkbrook Holdings Ltd [1999] NZRMA 23 (CA) at 31, citing Hanson v Church
Commissioners for England [1978] QB 823 (CA) at 832.
82 Resource Management Act 1991, ss133A and 357A(i)(f)-(g) and (2).
the appeal would no longer lie in respect of the original decision by the consent authority; rather the focus of the appeal would have to be on its “new decision” as documented in the consent memorandum.
[68] The Court’s practice note itself makes it clear that where a Court suggests amendments to a proposed consent order, the parties must have “the opportunity to consider the suggestions and to decide whether that might affect their willingness to settle the issues”.83 Clearly, therefore, the practice note does not contemplate the consent authority being rendered functus officio upon the filing of a consent memorandum.
[69] In summary, the reasons for which I reject the Environment Court’s analysis in relation to this issue are as follows:
(a) Once the CRC has made a decision at first instance, there are only very limited circumstances in which it has legal authority to revisit that decision and make a new decision. None of those limited circumstances applies in the present case. Accordingly, its original decision is binding upon it, as it is on all the parties, unless as a result of the appeal there are changes to that decision. All the consent authority is doing when it becomes a party to a consent memorandum is advising the Court of its position in respect of the issues raised on the appeal. As a matter of law it cannot be making a second or fresh decision.
(b)The agreeing to, signing and filing of a consent memorandum is not, either in law or fact, the making of a decision in a judicial or quasi judicial sense. There is nothing within the RMA, explicit or implicit, to suggest that taking a position either amounts to a decision, constitutes an abandonment of an earlier decision, or would render the
CRC functus officio.
83 Environment Court of New Zealand Practice Note 2014.
(c) Similarly, there is nothing in the standard form of consent orders, the explanatory note to those orders, or the Environment Court Practice Note 2014 which would support the Environment Court’s interpretation. To the contrary, the practice note contemplates that any suggestions for change made by the Environment Court are to be referred to the parties, who are to consider whether such changes have any bearing upon their desire to settle on the agreed terms.
(d)Neither the Environment Court, nor any party, including the amicus, was able to produce any authority for the proposition that the consent memorandum has the effect contended for by the Environment Court.
(e) The Environment Court’s interpretation potentially could lead to illogical consequences. It is worth considering what as a matter of law has happened to the original decision if a position taken by the consent authority in a consent memorandum abrogates its first instance decision. If the consent authority was functus, it is not clear what the situation would be if the Environment Court suggests changes to those proposed in the consent memorandum. Could the consent authority accede to the changes, or would it be unable to act further because of the position it had taken in the consent memorandum? The practice note clearly contemplates a consent authority being able to revert to its previous decision in the event the Court rejects the revised proposal in the consent memorandum, or suggests changes are required to the terms being proposed.
(f) A consent memorandum can only ever be, as it is in any area of litigation, a position communicated to the Court in respect of which there is consensus. The Court, of course, is not obliged to accept that position. Until it formally grants orders no decision on the appeal has been made, and the first instance decision remains extant.
[70] The last two conclusions are implicit from the Environment Court’s own reasoning. It stated:84
The Council is not a horse and water trader as the other parties may be, but is bound by its new decision as recorded in the consent memorandum (subject to approval by the Court under s 290).
[71] And:85
… The consent memorandum is in effect a new decision subject to the endorsement of the Court under s 279(1)(b) or s 290 RMA.
[72] These passages beg the question; what happens when the Court does not endorse the consent authority’s new decision? In the absence of the imprimatur of the Environment Court there can be no new decision, as the present case readily illustrates. The original decision remains. On the one hand, the Environment Court recognises that until the CRC’s “new decision” has its endorsement it is of no legal effect, but, on the other hand, it concludes that the mere entering into a consent memorandum is sufficient to result in the consequence of a new decision and to render the consent authority functus. The two propositions cannot be reconciled.
[73] It follows from the foregoing analysis that the Environment Court was in error in concluding that a consent memorandum constitutes an abandonment of a first instance decision, and that entering into a consent agreement renders the CRC functus officio.
Does a consent memorandum amount to a representation or undertaking that cannot be resiled from without leave of the Court?
[74] At several points throughout its judgment the Environment Court considers a consent memorandum to constitute either a representation or undertaking binding on the CRC. Undoubtedly, the Court is entitled to rely on the specific representations required by the practice note that the conditions in the draft consent order fall within
the Court’s jurisdiction, and that the conditions conform to relevant requirements and
84 Procedural Decision, above n 1, at [70] (emphasis added).
85 At [79] (emphasis added).
objectives of the RMA.86 The Environment Court, however, took the proposition much further.
[75] It held the consent memorandum as a whole was clearly intended to be a document the Court could rely on, and that on that “simple ground alone” it considered the putative withdrawal by Amuri of its appeal to be invalid unless leave was obtained. This proposition appears to be linked with the idea that the consent memorandum must contain a version of conditions which are better than the original decision and which can be relied upon as such by the Court. The Environment Court appears to consider the parties, and CRC in particular, are providing an undertaking to the Court to that effect.
[76] Mr Milne when addressing this issue observed that at the Environment Court hearing of these issues the Court put to counsel that the entire consent memorandum constituted an undertaking from which the parties could not resile. In response to such a proposition, Mr Milne submitted the consent memorandum does not include any statement that having submitted the proposed consent as a settlement arrangement, the parties will not resile from it or seek to change it, nor does it contain any statement that the parties will agree to any further amendments that may be suggested, or required by the Court. No such requirement is set out in the Court’s practice note, nor in the explanation for the standard consent order. As already noted, to the contrary, the practice note provides that should a Court consider modifications to be desirable, the parties will be afforded the opportunity to consider those suggestions and decide whether that may affect their willingness to settle the issues.
[77] Mr Milne submitted there was no basis to suggest the consent memorandum was set in stone, or that the parties to the memorandum were estopped from withdrawing it, or changing their positions while the memorandum remained under
consideration by the Court.
86 Springs Promotions Ltd v Springs Stadium Residents Association Inc [2006] NZRMA 101 (HC)
at [77].
[78] Any analogy sought to be drawn by the Environment Court between statements made in a consent memorandum and undertakings provided, either by counsel or by the parties, is misconceived. At best, the representations made by the parties in the consent memorandum certify that the conditions in the draft consent order fall within the Court’s jurisdiction and conform to the relevant requirements and objectives of the RMA. In any case, notwithstanding how those particular representations are characterised, the balance of the consent memorandum bears no resemblance to undertakings which cannot be resiled from without leave of the
Court.87 An undertaking is generally understood to be a promise to do or refrain
from doing something, and is a label quite unsuited to describe statements made by the parties in a consent memorandum representing the basis upon which they are presently agreed to settle an appeal.88
[79] The Environment Court was incorrect to hold the consent memorandum amounted to a binding representation or undertaking. My reasons for this conclusion can be distilled as follows:
(a) There is no authority, whether legislative or in case law, to support the proposition that the entirety of a consent memorandum amounts to either a binding representation or an undertaking. Nor is there anything in the consent memorandum which would have intimated such to the Court.
(b)There is no contest that the consent memorandum contains a binding representation that matters proposed for the Court’s endorsement fall within its jurisdiction and conform to relevant requirements and objectives of the RMA, upon which it was entitled to rely. The parties acknowledged that position, however, to extend that requirement to the balance of the consent memorandum as creating binding obligations on the parties from which they could not resile is
unsupportable.
87 Compare Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, r 10.3.
88 Gill McAsey v Wainui Timber Co Ltd [1992] 1 NZLR 1 (CA) at 4.
(c) As already traversed under earlier headings, if the consent memorandum did contain such representations or undertakings, it is not clear how the parties are supposed to respond once the consent memorandum is filed and further dialogue entered into between the Court and the parties.
(d)It follows from the Environment Court’s finding of the effect of a consent memorandum that, once filed, the parties could not alter their position. However, the whole basis of the consent memorandum procedure is that a consensus has been reached between the parties. Absent consent there is no foundation for the making of the orders. Such an approach conflicts with how the Courts view the legitimate basis upon which orders are made by consent. If the Court is on notice that one or more parties, indeed, in this case all parties, no longer wish to consent, or seek to withdraw their consent, the very basis for making the order is removed. Quite how the Environment Court would proceed to make such orders in the knowledge that one or more of the parties no longer consents because their previous representation is deemed to have been binding, or amounts to an undertaking to the Court, is not clear. It is both wrong in principle and unworkable.
Ability to distinguish Mullen v Parkbrook Holdings Ltd
[80] The conclusions that I have reached in relation to the Environment Court’s analysis of the status and effect of consent memoranda reveals there is no basis to distinguish the binding authority of Mullen v Parkbrook Holdings Ltd. The fact the Environment Court has before it a consent memorandum does not affect the application of the Court of Appeal’s reasoning in that case. The Court of Appeal explicitly framed the issue for its consideration in general terms, namely, whether any restrictions exist on the ability of appellants in the Environment Court to abandon or withdraw their appeal. Absent an abuse of process, the Court of Appeal concluded there were none.
[81] There is no reason to consider that the Court of Appeal’s conclusion in Mullen does not continue to have application to appeals where the parties are agreed on the withdrawal of the appeal notwithstanding the previous lodging of a consent memorandum. In the absence of any basis to distinguish Mullen it follows the parties have a right to withdraw their appeal at any time, both until hearing and until a decision is released, subject only to the Court being able to refuse leave where there has been an abuse of process.
Abuse of process
[82] In the event the Environment Court was wrong about the requirement of leave to withdraw an appeal, it considered whether an abuse of process had been established in the circumstances. Section 279(4)(c) of the RMA provides the Court with specific statutory power to strike out a proceeding (in whole or part) if the Environment Judge considers it would otherwise be an abuse of the process of the Court to allow the case to be taken further. This statutory power, directed at the commencement or continuation of a proceeding before it, appears to be no more than statutory recognition of the Court’s wider inherent power to protect itself from an abuse of its own process.
The abuse of process jurisdiction
[83] The jurisdiction of a Court to prevent an abuse of its own process is the means by which a Court can prevent its own procedures from being misused to achieve a result which is manifestly unfair to a party to the litigation, or would otherwise bring the administration of justice into disrepute among right-thinking people.89 A misuse of the judicial process which tends to produce unfairness and to undermine confidence in the administration of justice may entitle a Court to act to prevent such abuse.90
[84] Two aspects need to be stressed when considering the legitimate resort to this jurisdiction. Firstly, the jurisdiction relates to the protection of the integrity of the
Court’s process. The threat must be to the process of the Court which is wrongly
89 Hunter v Chief Constable of the West Midlands Police [1982] AC 529 (HL).
90 Reid v New Zealand Trotting Conference [1984] 1 NZLR 8 (CA); Waitakere City Council v
Kitewaho Bush Reserve Co Ltd [2005] 1 NZLR 208 (HC) at [65].
being made use of and from which the Court must protect itself. Secondly, a charge that a party is misusing the Court’s process is a serious allegation. The threshold to establish abuse of process is a high one. As Richmond P stated in Moevao v Department of Labour:91
However, it cannot be too much emphasised that the inherent power to stay a prosecution stems from the need of the Court to prevent its own process from being abused. Therefore any exercise of the power must be approached with caution. It must be quite clear that the case is truly one of abuse of process and not merely one involving elements of oppression, illegality, or abuse of authority in some way which falls short of establishing that the process of the Court has itself been wrongly made use of.
[85] Moevao involved whether a criminal prosecution constituted an abuse of the Court’s process. However, similar considerations apply in determining whether the acts of parties in civil proceedings, particularly, in the present context, those of the responsible consent authority, constitute an abuse of the Court’s process. In Telstra New Zealand Holdings Ltd v Commissioner of Inland Revenue, Wylie J held that the jurisdiction to set aside a discontinuance, which is a procedural step analogous to the withdrawal of an appeal, is likely to be used sparingly and only where plainly justified. The misconduct must be “plain and obvious” before a Court will find its
processes have been abused.92
[86] In assessing whether there has been an abuse of process the focus must be on the actions of the parties. In this case, the acts alleged include that of the appellant, Amuri, which seeks to withdraw its appeal and that of CRC which consented to that course. However, the jurisdiction is not a punitive one employed to discipline or
express disapproval of the parties conduct.93
The Environment Court’s decision on abuse of process
[87] The Environment Court held that the parties rescission of their consent memorandum constituted an abuse of process. It “infer[red] from the documents”
91 Moevao v Department of Labour [1980] 1 NZLR 464 (CA) at 470-471.
92 Telstra New Zealand Holdings Ltd v Commissioner of Inland Revenue (2010) 21 PRNZ 1 (HC)
at [34]-[35].
93 Fox v Attorney-General [2002] 3 NZLR 62 (CA), citing R v Horseferry Road Magistrates’ Court, ex p Bennett [1994] 1 AC 42 (HL); Parkbrook Holdings Ltd v Auckland City Council and Anor [1999] NZRMA 10 (HC) at [20].
that the parties had used the withdrawal of the appeal for three improper purposes.94
These were listed by the Court in the following terms:95
(a) Resiling from the consent memorandum when the scheme of the
RMA requires the parties’ representations to be binding on them;
(b) Avoiding the Court’s checking, under s 290 RMA, of the proposed
conditions of consent in the consent memorandum; and
(c) In combination with (b), avoiding any question as to whether the conditions are appropriate given the new data for nutrient loads in the Hurunui River.
[88] An immediate issue that arises in the context of the present case is whether the parties withdrawal of an appeal can of itself constitute an abuse of process. The Environment Court relied on the House of Lords decision in Castanho v Brown & Root (UK) Ltd as supporting the proposition that a purported discontinuance could
be held invalid as being an abuse of process.96 The challenge in that case was
against a plaintiff attempting to instigate proceedings in the United States when it had already secured two interim payments and an admission of liability in relation to the same cause of action in Courts of the United Kingdom.
[89] The House of Lords held that to permit the plaintiff to discontinue the proceeding so he might sue the same defendant in another jurisdiction for higher damages would amount to an abuse of process. If the discontinuance was permitted, a collateral advantage would be attained which would be unjust for the plaintiff to retain against the other party. In the circumstances the House of Lords held that a Court should not allow its processes to be used to facilitate such an outcome.
[90] The case has little application to the facts of the present proceeding. No party has at any stage made any allegation of another obtaining a collateral or unfair
advantage as a result of withdrawing the appeal. The parties, in fact, have agreed
94 Procedural Decision, above n 1, at [141].
95 At [141](1)-(3).
96 At [104]-[107], citing Castanho v Brown and Root (UK) Ltd [1981] AC 557 (HL).
unanimously to its withdrawal. Equally, it does not appear there is evidence of the existence of any collateral advantage or unfairness. The parties are simply reverting to the position of the first instance decision. While acknowledging that a Court may take the initiative to protect its own process, it is difficult to ascertain how the Environment Court could conclude in the present context its processes were being wrongly made use of, or that some ulterior purpose is sought to be accomplished by the parties, when the result of the withdrawal is to retain the status quo and allow the original decision of the consent authority to stand.
[91] The Environment Court’s approach to the issue of abuse of process rests upon the same analysis which it applied to the issue of whether the parties could withdraw the appeal without leave. It is best captured in the following passage from the Environment Court’s judgment concerning abuse of process:97
[114] In Mullen the role of the respondent did not acquire any prominence. However, once a consent authority has signed a consent memorandum its position is different. It has been allowed to change its mind once by acceding to a consent memorandum. To allow the consent authority to now revert to a position (the original consents) which it has implicitly advised the Court is inadequate to achieve its plan – otherwise it could not have been satisfied with the conditions in the consent memorandum – would start to bring the administration of justice into disrepute unless there is good reason.
[115] Further, if the proposed orders are of concern to the Court for good reason such as apparent invalidity or uncertainty (that is different) or apparent failure on their face to meet standards in the rules for relevant plan or, more conscientiously, because there are reasonably possible errors of law in the first instance decision, and the Court raises issues about these matters, can the consent authority decide not to face up to those matters and resile from the consent memorandum? We consider the answer is “no”: having been allowed to change its decision once – unusual enough for a quasi- judicial decision – it cannot have the power to change it again. The situation becomes farcical and is likely to adopt Lord Diplock’s phrase in Hunter v Chief Constable West Midlands Police to bring the administration of justice under the RMA into disrepute among right-thinking people.
[92] It is apparent from this analysis, which largely repeats that applied in respect of the question of whether leave is required to withdraw an appeal, that the Environment Court’s approach to the question of abuse of process is mistaken. I
reach that conclusion for the following reasons.
97 Emphasis added.
[93] Firstly, as I have already held, the filing of a consent memorandum does not equate to the rendering of a further decision by the CRC (nor does it amount to an undertaking or binding representation). A necessary corollary of this is that there is no merit in the finding by the Environment Court that to allow the CRC to once more change its decision would amount to an abuse. Until the consent memorandum is crystallised into formal orders by the Court’s endorsement, the position is not settled and the parties are free to resile from the position taken in the consent memorandum at any point up until that time. Should the parties resile the very basis for the consent order, namely that the parties are agreed, is extinguished.
[94] Secondly, as I have already found, a consent memorandum does not amount to an acknowledgment, implicit or otherwise, that the original consents were inadequate to achieve the purpose of the RMA. Nor is the presentation of a consent memorandum to be equated to a representation by the CRC, or by any of the parties, that the proposed course recorded in the consent memorandum “better” achieves the purposes of the RMA.
[95] Thirdly, the Court’s concern that it not turn a blind eye to proposed orders which are invalid or uncertain, or fail to meet standards in the rules or relevant plan, will only arise if the consent memorandum is persisted with. Such issues do not arise if the parties withdraw, and in the former situation the Court does not have to grant the orders until such issues are addressed.
[96] The Court then theorises about its position should, as a result of the consent memorandum being filed, it come to its attention that there may be possible errors of law in the first instance decision. It poses the question, can the consent authority avoid addressing those matters? That is not the situation in the present case, and the Environment Court has not identified any illegality in the original consents. In any case, the view the Court can, on its own motion, keep an appeal on foot because it has concerns about “reasonably possible errors of law in the first instance
decision”,98 ignores the special feature of public law decisions that, however wrong
they may be, however lacking in jurisdiction they may be, they subsist and remain
98 At [115].
fully effective unless and until they are set aside by a Court of competent jurisdiction.99
[97] In order for the Environment Court to set aside the decision of a consent authority for reason of error it must be properly seized of it, hear argument and evidence, and release a decision deciding the dispute. Importantly, in the face of a consent authority and other parties not seeking to put the issue in contest, the parties cannot be forced to argue the point. How a refusal to be compelled by a Court to do so amounts to an abuse of the Court’s process is not apparent.
[98] This leads to the fourth point. It is not part of the Court’s jurisdiction to critique the proposed orders to ensure they are valid or certain and meet the standards of the rules or relevant plan, unless the Court has a live appeal before it. The Court’s task is to adjudicate disputes. Upon withdrawal of the appeal, the Court’s role is at an end. In this case, that is what has happened. Further, the Court is not obliged to accede to consent memorandum. If it does not, the parties are still able to negotiate a solution to their satisfaction, including by withdrawal of the appeal.
[99] It is clear from the practice note itself that the parties are not obliged to accept suggested changes proposed by the Court. They cannot be compelled to consent, or to litigate against their will. In the absence of the Court declining to make orders in accord with the consent memorandum filed, the original decision will stand, and the conditions of any consent, as determined by due process before the consent authority, will endure. Again, it is difficult to conceive how such a result could constitute an abuse of the Court’s process.
[100] Fifthly, the threshold for establishing abuse of process is high. Where an abuse of process is found to exist it must be based on clear concluded findings of fact. The circumstances need to be plain and obvious. The Environment Court’s concerns regarding the motivations of the parties are inherently speculative. The
Environment Court expressly states that it has inferred from documents that the
99 R v Panel on Take-overs and Mergers, Ex p Datafin Plc [1987] QB 815 (CA) at 840.
parties have used the withdrawal of the appeal for improper purposes.100 The first of those improper purposes is dependent on a finding of law which I have held to be in error. The two other “inferred” improper purposes are disputed by the parties and remain untested. There is an insufficient evidential basis upon which to make such serious allegations, let alone affirmative findings of abuse.
[101] The Environment Court’s decision contains expressions of concern about alleged failures to disclose data and remarks that it finds it “strange” why it did not receive advice it contends the CRC should have provided it with.101 The Court muses that there is “something rather curious about” Amuri withdrawing its appeal after receiving written undertakings from Hurunui before remarking that this “cumbersome procedure” appears to be to stop the Court from asking embarrassing questions about other aspects of the proposed orders, and to avoid time and expense of answering them.102 Leaving aside whether such motivations are capable of giving rise to an abuse of process, these are expressions of views and perceptions which do not reflect the considered findings of a detached Court. In the absence of accepted or admitted particulars it is necessary for a Court to make specific findings of fact in order to have a reliable factual matrix upon which to assess whether an abuse of its process has occurred.
[102] Concerns relating to the identified subjects may be held by the Court. However, in order to invoke the Court’s abuse jurisdiction the parties’ actions must give rise to a need for the Court to protect itself from its processes being abused. The Environment Court has drawn the inference that the parties are deliberately avoiding its oversight by avoiding it checking the conditions as they relate to data for nutrient loads in the Hurunui River. Whether that of itself could constitute an abuse of process is not without controversy, but the parties denied any such intention.
[103] Clearly, issues of potential concern were raised by the Environment Court with the content of the consent memorandum. In particular, these related to side agreements and nutrient loads and river data. However, in the absence of hearing
evidence and making specific findings of fact which, given the nature of the
100 Procedural Decision, above n 1, at [141].
101 At [138].
102 At [135].
deliberate conduct alleged, would have required oral evidence and cross-examination in the absence of specific admissions, the expressed suspicion of the Court regarding the conduct of the parties is an inherently insufficient basis upon which to conclude that the parties were abusing the Court’s process by withdrawing the appeal.
[104] The unresolved conflict between the position of the parties and the concerns of the Court is best illustrated by the submissions made on behalf of CRC that the Environment Court was incorrect in its findings about nitrogen “head room” available within the Hurunui catchment. CRC submitted the Environment Court misinterpreted the effect of the original consent and misled itself as to the availability of head room for the Hurunui Water Project scheme. CRC submitted the Environment Court’s conclusion that the latest water quality data for the Hurunui River indicated there would be an 88 per cent reduction in the available head room for the scheme was incorrect. I was advised that the latest water quality data indicates that there remains 154 tonnes per year of Dissolved Inorganic Nitrogen (DIN) head room available within the Hurunui catchment.
[105] The Hurunui Water Project scheme was allocated an additional DIN load of
143 tonnes, being the difference between the total allocation made to Hurunui of 514 tonnes per year and the existing contribution of DIN within the Hurunui water project scheme of 371 tonnes per year. CRC submitted the Environment Court appears to have erroneously proceeded on the basis that the allocation of a total of
514 tonnes per year of DIN load to Hurunui was all “new” DIN, rather than a combination of existing DIN together with 143 tonnes of “new” DIN. It submitted, in those circumstances, the Court has come to an erroneous conclusion on the evidence about the available DIN head room for the HWP scheme.
[106] As I commented at the commencement of this judgment, it is not necessary to resolve which position is correct for the purposes of this appeal. However, it is apparent that sitting behind the Environment Court’s judgment is a concern or suspicion that the parties are seeking to avoid the Court’s “checking” of the appropriateness of the conditions of the consent in light of new data relating to
nutrient loads in the Hurunui River.103 The validity of those concerns are moot. Such concerns cannot be, and ought not to be, used as a basis upon which to rest findings of abuse of process based as they are on unsubstantiated inferences by the Court that the parties are deliberately seeking to avoid the Court’s oversight.
[107] The Court has not undertaken the necessary process of hearing evidence in respect of its allegations which are clearly in contest. The Court does not therefore have the necessary proof upon which to make such factual findings, which are a necessary prerequisite to the invocation of the abuse of process jurisdiction. In the absence of the necessary evidential foundation the Court is not appropriately positioned to make the type of serious findings necessary to hold that the parties are abusing the Court’s process by withdrawal of the appeal. On this basis alone, the finding of an abuse of process has been made in error.
[108] Similarly, there is a dearth of evidence to conclude the CRC has not appropriately discharged its obligations in accordance with its statutory responsibilities. It follows that the Environment Court’s conclusion that the approval by CRC of the withdrawal of the appeal is an abuse of the Court’s process must be set aside.
[109] On appeal, the parties complained that the Environment Court did not squarely put its concerns that their withdrawal was an attempt to avoid the Court checking the conditions and avoid questioning about the new nutrient data. They submitted that had those concerns been put at the hearing those matters would have been clarified. If such findings have been made by the Court without notice to the parties that is troublesome, however, in the circumstances and on the available information, I am not able to comment further.
[110] Finally, whatever the ambit of the public interest role the Environment Court may have, it is insufficient to warrant its interference with the appellant’s right in the absence of opposition, to take the procedural step of withdrawing its appeal and deciding to no longer take issue with the first instance decision. Similarly, it cannot
extend to prevent the consent authority, which must continue to bear statutory
103 At [141](2).
responsibility for the issued consent, from consenting to that withdrawal. The
Environment Court stated:104
Section 104 is important because it shows that the consent authority and, on appeal, the Environment Court is not simply to adjudicate between the parties but to achieve (ultimately) the purpose of the Act. As Judge Thomson stated in Hamilton East Community Trust v Hamilton City Council:
[3] I start with the proposition that proceedings in this Court are not, as is most of the case in the general Courts, simply a contest inter partes. This Court has a wider role – viz to seek an outcome that best complies with, and promotes the purpose of the Act:- see Part 2 of the RMA and, in particular, s 5.
[111] Judge Thomson’s observation is undoubtedly correct in the context of a proceeding which is being contested by the parties and in respect of which they seek an outcome from the Court. Absent that situation, responsibility for achieving the purpose of the Act under s 104 remains with the consent authority. In the wider field of public law a Court may need to have regard to wider considerations of public interest beyond the individual interests of the parties. Such a factor does not justify the Environment Court’s view that it may trump the parties wishes to stop litigating a matter by requiring them to continue the proceeding. The Court of Appeal’s
observations in Mullen v Parkbrook Holdings Ltd remain apposite:105
If all parties consent to, or do not oppose, the intended withdrawal of the appeal, it can hardly be right that the Court can insist on the case proceeding because it has some perception of a contrary public interest.
…
It remains only to say that we agree with Salmon J that there was no abuse of process in the withdrawal by Mr McLean and Ms Stirrup of their appeal. The Environment Court tended to merge its conception of the wider public interest with questions of abuse of process. The idea of the Court being some sort of public watchdog is not the same as the idea involved in some procedural step being an abuse of process. There is nothing which we need add to what Salmon J said on this topic.
[112] The Environment Court’s finding that the withdrawal of the appeal by the parties constituted an abuse of process rests on the same reasoning it relied upon to conclude leave was required for the appeal to be withdrawn. That reasoning, as I
have found, is flawed. Furthermore, there is no proper basis upon which the Court
104 At [56].
105 Mullen v Parkbrook Holdings Ltd, [1999] NZRMA 23 (CA) at 34 and 38.
could have concluded that the course proposed by the parties to withdraw the appeal eroded confidence in either the administration of justice generally, or specifically as it relates to the RMA. There is no unfairness to any party arising from the withdrawal, and none is claimed. The result of the withdrawal of the appeal is that the original decision by the competent consent authority, arrived at as a result of a thorough public process, remains in place. This is not an exceptional case where a
Court has to act on its own motion to prevent an abuse of its process.106
Outcome
[113] The appeals are allowed. The Environment Court’s decision that leave is required after a consent memorandum has been lodged in order for an appellant to withdraw and for a respondent not to oppose is set aside.
[114] The Environment Court’s decision that the filing of the notice of withdrawal of the appeal and CRC’s agreement to that withdrawal is an abuse of process is set aside.
[115] I make a declaration that the appeal by Amuri in the absence of opposition was validly withdrawn. As a result, the appeal before the Environment Court is terminated subject to any question of costs.
[116] Costs are reserved.
Solicitors:
Duncan Cotterill, Christchurch
Wynn Williams, Christchurch
106 Waterhouse v Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at fn 30.
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