Kilmarnock Farm Limited v Canterbury Regional Council

[2019] NZHC 2467

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2019-409-307

[2019] NZHC 2467

BETWEEN

KILMARNOCK FARM LIMITED

Appellant

AND

CANTERBURY REGIONAL COUNCIL

Respondent

Hearing:	10 September 2019
Appearances:	K Reid and N Daines for the Appellant P Maw and K Woods for the Respondent
Judgment:	30 September 2019

JUDGMENT OF MANDER J

This judgment was delivered by me on 30 September 2019 at 3.15 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:     .

KILMARNOCK FARM LTD v CANTERBURY REGIONAL COUNCIL [2019] NZHC 2467 [30 September 2019]

[1]    The appellant, Kilmarnock Farm Ltd (Kilmarnock), is the owner of a North Canterbury farming property. It held two resource consents, granted by the Canterbury Regional Council (the Council), that authorised the taking of water from the lower Hurunui River for the purpose of irrigation (the water permits).

[2]    Both permits were utilised. One of the water permits was used to take water from the river using a movable pump between 20 and 22 September 2017. Much of the portable intake equipment was then transferred to another intake point and water was taken pursuant to the second water permit between 26 and 27 September 2017.

[3]    The Resource Management Act 1991 (the Act) provides that a resource consent will lapse if it is not “given effect to” by a particular date. In the case of Kilmarnock’s water permits this date was 30 September 2017.

[4]    On 18 October 2017, the Council wrote to Kilmarnock and advised that the water permits had lapsed because they had not been given effect to. The Council informed Kilmarnock that several “establishment conditions” of the water permits that were required to be complied with before water could be taken had not been met. In particular, the Council identified a lack of compliance with the permits’ fish screen conditions. The Council informed Kilmarnock that its taking of water at the two locations during the prior month did not “legally constitute giving effect to the consents”, and that it was no longer authorised to take water from the Hurunui River pursuant to those consents.

[5]    Kilmarnock rejected the Council’s position and sought declarations from the Environment Court that both water permits had been given effect to and had not lapsed.1 The Court declined to make those declarations.2 It found that the fish screen conditions of the water permits had not been “substantially and reasonably” complied with and that as a result neither resource consent had been “adequately or sufficiently” given effect to. As a consequence, the water permits had lapsed on 30 September.

1      Resource Management Act 1991, s 125.

2      Kilmarnock Farm Ltd v Canterbury Regional Council [2019] NZEnvC 84.

[6]    Kilmarnock appeals the decision of the Environment Court. It argues that the Court erred in law when it found that it had failed to comply with the requirements of the permits’ fish screen conditions and that it had failed to give effect to the resource consents.

The law relating to the lapsing of resource consents

[7]    Section 125 of the Resource Management Act 1991 (the Act) regulates the lapsing or resource consents. It relevantly provides:

125     Lapsing of consents

(1)A resource consent lapses on the date specified in the consent or, if no date is specified,—

(a)5 years after the date of commencement of the consent, if the consent does not authorise aquaculture activities to be undertaken in the coastal marine area; or

...

(1A)However, a consent does not lapse under subsection (1) if, before the consent lapses,—

(a)the consent is given effect to; or

(b)an application is made to the consent authority to extend the period after which the consent lapses, and the consent authority decides to grant an extension after taking into account—

(i)whether substantial progress or effort has been, and continues to be, made towards giving effect to the consent; and

(ii)whether the applicant has obtained approval from persons who may be adversely affected by the granting of an extension; and

(iii)the effect of the extension on the policies and objectives of any plan or proposed plan.

(1B)     Sections 357A and 357C to 358 apply to subsection (1A)(b).

...

[8]    The relevant legal principles relating to the application of s 125 and the lapsing of resource consents are not in dispute. Whether a consent has been “given effect to” will be a question of fact and degree. It will turn on the particular facts of the

individual case but will not include an evaluation of the consequences that would flow from the consent having been held to have lapsed.3 Whether there has been compliance with the conditions of a consent will be a central consideration.4 In that regard, a distinction is to be drawn between resource consent conditions which prescribe methods for establishing an activity, “establishment” conditions, and those conditions which prescribe methods for continuing an activity, “continuation” conditions.5

[9]    Continuation conditions are generally considered to relate to ongoing compliance and enforcement issues, whereas establishment conditions, particularly where they involve a prohibition on the operation of a resource consent until fulfilled, are likely to inform the question of whether a consent has been given effect to.6

[10]   Neither party disputes the Environment Court’s approach to the application of these principles. Each accepts that the Court was correct to find that the distinction between establishment conditions and continuing conditions was a useful one and that the most important question it was required to address to determine whether the resource consents had lapsed, was whether the establishment conditions set out in the water permits had been “substantially and reasonably satisfied”.

A question of law

[11]   Appeals to this Court from the Environment Court are limited to those that raise questions of law.7 In Kilmarnock’s notice of appeal it formulated the following question of law:

Did the Environment Court err in law by deciding that the appellant failed to substantially and reasonably comply with the establishment conditions in water permits CRC170217 and CRC142894 by the lapse date of 30 September 2017 and so failed to give effect to the two water permits?

3      Goldfinch v Auckland City Council [1997] NZRMA 117; Auckland Council v 184 Maraetai Road Ltd [2015] NZHC 2254 at [29].

4      Biodiversity Defence Society Inc v Solid Energy New Zealand Ltd [2013] NZEnvC 195 at [71].

5      Koha Trust Holdings Ltd v Marlborough District Council [2016] NZEnvC 152 at [62].

6      Koha Trust Holdings Ltd v Marlborough District Council, above n 5, at [62]; Resource Management Act 1991, s 125(1A)(a).

7      Resource Management Act 1991, s 299.

[12]   The question, framed as it is, does not assist in identifying the alleged error(s) of law sought to be raised on the appeal. However, the essential point of law that is relied upon is tolerably clear from Kilmarnock’s written submissions. Kilmarnock contends that the Environment Court erred by finding on the evidence adduced before it that Kilmarnock had failed to substantially and reasonably comply with the fish screen conditions. Moreover, that the Environment Court erred in law by allegedly coming to its conclusion that the resource consents had not been given effect to without evidence, or that, on the available evidence, it could not reasonably have arrived at such a conclusion.8

[13]   Errors of this sort are rare. In Bryson v Three Foot Six Ltd, Blanchard J, delivering the judgment of the Supreme Court, observed:9

An ultimate conclusion of a fact-finding body can sometimes be so insupportable - so clearly untenable - as to amount to an error of law; proper application of the law requires a different answer. That will be the position only in the rare case in which there has been, in the well-known words of Lord Radcliffe in Edwards v Bairstow , a state of affairs “in which there is no evidence to support the determination” or “one in which the evidence is inconsistent with and contradictory of the determination” or “one in which the true and only reasonable conclusion contradicts the determination”.

[14]   In Guardians of Paku Bay Association Inc v Waikato Regional Council, Wylie J cautioned against disappointed litigants in the Environment Court using appeals to the High Court to relitigate factual findings made by the Environment Court.10 The Judge observed:

This Court can only intervene in such situations where the Environment Court has come to a decision to which, on the evidence, it could not reasonably have come. This can be described as a situation in which there is no evidence to support the determination, or as one in which the evidence is inconsistent with and contradictory to the determination, or as one in which the true and only reasonable conclusion contradicts the determination. It is trite law however

8      Countdown Properties (Northlands) Ltd v Dunedin City Council [1994] NZRMA 145 (HC) at 153; Nicholls v Papakura District Court [1998] NZRMA 233 (HC) at 235; Guardians of Paku Bay Association Inc v Waikato Regional Council [2012] 1 NZLR 271, (2011) 16 ELRNZ 544; Hawke’s Bay and Eastern Fish and Game Councils v Hawke’s Bay Regional Council [2014] NZHC 3191 at [94].

9      Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721 at [26], citing with approval Lord Radcliffe in Edwards v Bairstow [1956] AC 14, 36.

10  Guardians of Paku Bay Association Inc v Waikato  Regional Council, above n 8, at [32], citing  New Zealand Suncern Construction Ltd v Auckland City Council [1997] NZRMA 419 (HC) at 426.

that the sufficiency of evidence, rather than the want of it, cannot amount to a point of law.

(Citations omitted)

[15]   In order to establish an error of law it is not sufficient to simply identify a false factual finding upon which the lower Court relied. The appeal Court must be brought to the position where, after correcting the erroneous factual finding and having taken into account the balance of the lower Court’s other findings, it can conclude that the Court could not reasonably have come to the decision it made. Essentially it requires a conclusion that the error was of such material effect that it led the Environment Court to make a determination that was not otherwise available to it.

The fish screen conditions

[16]   The two water permits set out two identical conditions relating to the design, installation and certification of fish screens. Condition 5 provided:

a.Water shall only be taken when a fish screen with a maximum mesh width and height size of three millimetres or slot width and height of two millimetres is operated and maintained across the intake to ensure that fish and fish fry are prevented from passing through the intake screen.

b.The fish screen shall be positioned to ensure that there is unimpeded fish passage to and from the waterway and to avoid the entrapment of fish at the point of abstraction and to minimise the risk of fish being damaged by contact with the screen face.

c.The fish screen shall be designed and installed to ensure that:

i.The majority of the screen surface is orientated parallel to the direction of water flow.

ii.Where practicable, the screen is positioned in the water column a minimum of 300 millimetres above the bed of the waterway and a minimum of one screen radius from the surface of the water.

iii.The approach velocity perpendicular to the face of the screen shall not exceed 0.06 metres per second if no self-cleaning mechanism exists, or 0.12 metres per second if a self-cleaning mechanism is operational.

iv.The sweep velocity parallel to the face of the screen shall exceed the design approach velocity.

[17]Condition 6 provided:

a.The fish screen shall be designed or supplied by a suitably qualified person who shall ensure that the design criteria specified in condition 5(a)-(c)(iv) of this consent is achieved. Prior to the installation of the fish screen, a report containing final design plans and illustrating how the fish screen will meet the required design criteria, and an operation and maintenance plan for the fish screen shall be provided to Environment Canterbury, Attention RMA Compliance and Enforcement Manager.

b.A certificate shall be provided to Environment Canterbury by the designer or supplier of the fish screen to certify that the fish screen has been installed in accordance with the details provided to Environment Canterbury in accordance with condition 6(a) of this consent; and

c.The fish screen shall be maintained in good working order. Records shall be kept of all inspections and maintenance, and those records shall be provided to Environment Canterbury upon request.

The Environment Court decision

[18]   It is not disputed that the Environment Court correctly identified that an onus lay on Kilmarnock to prove the necessary facts to demonstrate that the establishment conditions had been given effect to. Those facts, which reflected the requirements of the fish screen conditions, were set out in the judgment. They included the furnishing of a report to the Council setting out the final design plans of the fish screen prior to its installation, and how the criteria set out in condition 5 would be met. A similar requirement was imposed in respect of an operation and maintenance plan for the device. Kilmarnock was also required to prove that prior to water being abstracted the installed fish screen reasonably met the requirements set out in condition 5.

[19]   The Environment Court reviewed the evidence as it related to the proof both of these requirements and others. This included an assessment of the evidence provided by Mr Peter Taylor, a senior resource management officer employed by the Council, Mr Richard Purdon, a principal consent planner also with the Council, and Mr David Fahey, who was employed by a company engaged by Kilmarnock to establish water pumping and irrigation equipment on the farm, ensure it was working properly, and complete verification and certification paperwork.

[20]   The Court concluded that compliance with a number of the requirements of the fish screen establishment conditions had not been proved. It held that the fish screen was deficient in a number of respects and that condition 5 of the water permits had not been met. Those deficiencies were identified in the Court’s judgment in the following way:

Condition 5b

The fish screen shall be positioned to ensure that there is unimpeded fish passage to and from the waterway and to avoid the entrapment of fish at the point of abstraction, and to minimise the risk of fish being damaged by contact with the screen face.

The Environment Court concluded that there was no “specific evidence” as to the positioning of the screen in relation to the bed of the waterway at either of the abstraction points used by Kilmarnock.

Condition 5c.i

The fish screen shall be designed and installed to ensure that the majority of the screen surface is oriented parallel to the direction of water flow;

The Court again concluded that there was no “specific evidence” as to the orientation of the screen in relation to water flow.

Condition 5c.ii

The fish screen shall be designed and installed to ensure that where practicable, the screen is positioned in the water column a minimum of 300 millimetres above the bed of the waterway and a minimum of one screen radius from the surface of the water

The Court’s conclusion was that again there was no “specific evidence” as to the positioning of the screen in relation to the bed of the waterway at either abstraction point used by Kilmarnock.

Condition 5c.iii

The fish screen shall be designed and installed to ensure that the approach velocity perpendicular to the face of the screen shall not exceed 0.06 metres per second if no self-cleaning mechanism exists, or 0.12 metres per second if a self-cleaning mechanism is operational;

Based on evidence provided by Mr Taylor, the Environment Court held that this condition had not been met.

Condition 5c.iv

The fish screen shall be designed and installed to ensure that the sweep velocity parallel to the face of the screen shall exceed the design approach velocity.

The Court found there was no evidence as to whether the sweep velocity parallel to the screen face exceeded the approach velocity.

[21]   The Environment Court also held that Kilmarnock had failed to comply with various requirements of condition 6. Those breaches were not disputed by Kilmarnock. They were:

(a)a failure to supply a final design report to the Council prior to the installation of the fish screen, in breach of condition 6a; and

(b)a failure to supply an operation and management plan for the fish screen to the Council also in breach of condition 6a.

[22]   The Court also found that, in breach of condition 6b, no certificate had been provided to the Council by the designer or supplier of the fish screen to certify that the fish screen had been installed in accordance with the details provided in the pre- installation report. However, the Environment Court did not consider that requirement constituted an establishment condition.

[23]   After finding that the establishment conditions were “important”, the Environment Court held that condition 6a had not been satisfied and that the fish screen, as installed, was deficient. The Court held that condition 5 had also been breached and that the establishment conditions had not been “reasonably” met. The materiality of these findings is to be contrasted with the Council’s observations regarding Kilmarnock’s non-compliance with the water permits’ other conditions relating to the late installation of a meter and certification of its installation and the failure to provide a Farm Environment Plan. These were described as “technical breaches” that were “not determinative or relevant” to its overall finding.

[24]   The Environment Court held that it was of significance that the establishment conditions relating to fish screening had not been substantially and reasonably complied with “before or at commencement of operations in respect of either consent”. It described Kilmarnock’s compliance with those screening requirements as “perfunctory and temporary”. The Court referenced Kilmarnock’s use of a moveable pump at the two abstraction points and the temporary nature of the fish screen before concluding that the two resource consents had not been “adequately or sufficiently” given effect to and that, as a consequence, they had lapsed on 30 September 2017.

The appeal

[25]   Kilmarnock’s appeal rests on two propositions. Firstly, Kilmarnock alleges that the Environment Court’s conclusion that the fish screen was deficient and breached condition 5 was not available to it on the evidence and that its finding to that effect constituted an error of law. Secondly, that its admitted breaches of condition 6a were only of a “technical nature” and that it had complied with the more substantive requirement that the fish screen be designed or supplied by a suitably qualified person. Kilmarnock maintains the failure to supply the Council with the appropriate plans prior to the fish screen being installed could not, of and by itself, support a conclusion that it had failed to substantially and reasonably comply with the establishment conditions of the water permits.

Was a finding available on the evidence that condition 5 had been breached?

[26]   Kilmarnock carried the onus to establish that the fish screen had been designed and installed in accordance with condition 5. There are two aspects to this issue. First is the Environment Court’s finding that condition 5c.iii, which relates to the velocity of the water relative to the position of the screen, had not been met. The Court relied on Mr Taylor’s evidence to make that factual finding. The Council concedes that the Environment Court erred in so doing.

[27]   The second aspect is whether the Environment Court was entitled to conclude that there was no evidence or “no specific evidence” of compliance with the installation requirements of the fish screen set out in condition 5b and 5c.i, ii and iv.

Condition 5c.iii

[28]   After Mr Taylor’s evidence was filed, Mr Fahey provided a further affidavit clarifying issues identified by Mr Taylor in his evidence relating to the requirement set out in condition 5c.iii. The Council advised that it accepted the calculations contained in Mr Fahey’s reply affidavit and that the fish screen did not have to operate as self-cleaning when the approach velocity of the water did not exceed 0.06 m per second. The submissions filed by both Kilmarnock and the Council in the Environment Court recorded that they shared this position and that, on the basis of Mr Fahey’s evidence, the approach velocity perpendicular to the face of the fish screen complied with condition 5c.iii.

[29]   This agreed position was not referenced in the Environment Court’s decision. The Council acknowledges that the Court incorrectly relied upon calculations provided by Mr Taylor in his evidence to find that the requirements of condition 5c.iii had not been met. The appeal therefore proceeds on the acknowledged basis that the Court’s finding in respect of this condition was incorrect and one that was not available to it on the evidence before it.

[30]   Notwithstanding this factual error, the Council’s position is that this element of the Court’s analysis was not determinative of its decision. The Council submits that the Environment Court’s ultimate conclusion that the fish screen establishment conditions had not been substantially and reasonably complied with and that the resource consents had not been given effect to remained reasonably available to it on the evidence, and that this factual error had not resulted in the Environment Court making an error of law.

Conditions 5b and 5c.i, ii and iv

[31]   In addition to the Environment Court’s error in relation to condition 5c.iii, Kilmarnock submits that the Court also erred in finding that there was no “specific” evidence of compliance with conditions 5b, 5c.i and ii and in finding that there was no evidence to show compliance with condition 5c.iv.

[32]   Kilmarnock relies upon Mr Fahey’s evidence that the pumping equipment it used included a fish screen “that was compliant with the design and installation specifications set out in the conditions of the two consents”. Mr Fahey also refers to having completed an “intake screen installation” form in relation to the fish screen which recorded that it was a self-cleaning model of a compliant maximum mesh size and “through screen velocity” as required by the design requirements of the conditions. Mr Fahey affirms that the fish screen was in place before any water was taken.

[33]   Kilmarnock submits that Mr Fahey’s evidence of compliance was unchallenged and that there was no contrary evidence that the fish screen, as installed and used by it when taking water pursuant to the water permits, was other than compliant. There was, therefore, no basis upon which the Environment Court could have reached a different finding, or at least could have concluded, as it did, that there was no evidence of the screen complying with the requirements of condition 5.

[34]   In response, the Council submits that Mr Fahey’s limited evidence was insufficient to discharge Kilmarnock’s obligation to prove that the specific requirements of condition 5 had been met. It is noted as significant that while the Environment Court referred to this part of Mr Fahey’s evidence when assessing whether the installation and positioning requirements of the fish screen conditions had been met, it found, in respect of conditions 5b and c.ii, that there was no specific evidence as to the positioning of the screen in relation to the bed of the waterway at either abstraction point. In relation to condition 5c.i, it also expressly found that there was no specific evidence as to the orientation of the screen in relation to waterflow at the abstraction points.

[35]   The Council submits that the Court was cognisant of Mr Fahey’s evidence, but that it was implicit from its finding of there having been no specific evidence of compliance with the particular requirements of the condition that the Court did not consider Mr Fahey’s broad statement to be sufficient. The Council emphasises that another Court could have taken a different view of the sufficiency of the evidence. However, that does not render the Court’s finding to be an impermissible conclusion

for it to reach and it was entitled to take the approach it did to the adequacy of the evidence provided by Kilmarnock.11

[36]   Kilmarnock’s reliance on the intake screen installation form does not advance the issue. Its content is limited to compliance with the requirements of condition 5c.iii, which the Council accepts was established by Kilmarnock. Insofar as proof of compliance with the other requirements of condition 5 is concerned, the only evidence on the point was that provided by Mr Fahey. That evidence was broad and conclusionary in nature. It did not provide details of the actual orientation of the fish screen in relation to the waterflow or its position in the waterway at either abstraction point, as prescribed by condition 5c.i and ii, so as to ensure the unimpeded passage of fish and the avoidance of their entrapment, as required by condition 5b. Similarly, no particulars were provided as to how condition 5c.iv was achieved. Clearly, the Council was not in a position to adduce evidence on these matters. It was not privy to how the fish screen had been installed for the purpose of abstracting water during the two short periods in September. It had not been supplied with the necessary information from which to make such an assessment.

[37]   While relevant to the requirements of condition 6 rather than condition 5, it is notable that when the Environment Court made its conclusions regarding the absence of specific evidence as to whether certain requirements of condition 5 had been complied with, it cross-referenced in successive footnotes a paragraph in Mr Taylor’s affidavit. His evidence was that no records had been provided by Kilmarnock to the Council about the matters listed in condition 5 and that, as a result, it had no way of determining whether Kilmarnock had complied with condition 5 before utilising the permits.

[38]   Mr Taylor’s evidence concerned the failure by Kilmarnock to provide the appropriate information to the Council, rather than the absence of detailed evidence having been placed before the Environment Court. However, the Court’s reference to Mr Taylor’s evidence could be interpreted as a concern that without the furnishing of

11     Bryson v Three Foot Six Ltd, above n 9, at [27], citing Piggott Brothers & Co Ltd v Jackson [1991] IRLR 309, [1992] ICR 85.

such details there was no way of assessing compliance with condition 5, be it by the Council or the Court.

[39]   There is no discussion or analysis in the judgment of Mr Fahey’s evidence, other than what can be gleaned from the words used by the Court in three of its four findings of an absence of specific evidence. The Court made no findings as to the reliability or credibility of Mr Fahey as a witness which, Kilmarnock argues, left his evidence about there having been compliance with the design and installation requirements of the conditions unchallenged. Kilmarnock submits that it will be an error of law for a deciding body to fail to draw from unchallenged primary facts an inference in favour of a party when that inference is the only reasonable possibility.12 However, that principle says little about the question of the sufficiency of evidence and, as submitted by the Council, the Court must be cautious not to persuade itself that, because it might have reached a different conclusion, the tribunal which did so was wrong.13

[40]   I consider the Court was entitled to approach Mr Fahey’s bland assertion on this important issue with caution in the absence of any specific details having been provided regarding how the fish screen was deployed on each occasion water was taken from the river. In making its findings of fact regarding compliance with the requirements of condition 5, the Environment Court emphasised the absence of specific evidence as to the position and orientation of the fish screen. Despite harbouring some doubts regarding the Court’s approach to whether those requirements had been satisfactorily proved and its apparent conflation of the requirements of conditions 5 and 6 in coming to its conclusion, on balance I have not been brought to the view that the Court’s assessment was illegitimate or unavailable to it on the state of the evidence.

[41]   Mr Fahey’s broad claim that the fish screen complied with the specifications set out in the permits’ conditions could have been accepted by the Court on its face. However, that assessment was for the Environment Court to make as the responsible

12     Friends  of  Pakiri  Beach  v  Auckland  Regional  Council  [2009]  NZRMA  285  at  [20], citing

Smiturnugh Ltd v Auckland City Council HC Auckland AP28/00, 6 July 2000 at [6].

13     Bryson v Three Foot Six Ltd, above n 9, at [27].

fact-finder. Having regard to the context and nature of the issues before the Court, I am satisfied it was permissible for it to find that the lack of any details regarding the deployment and operation of the fish screen at the two abstraction points meant Kilmarnock’s evidence was inadequate to prove compliance with condition 5. Importantly, the lack of any specific information by Kilmarnock as to how the requirements of condition 5 were achieved serves to highlight the vulnerability of its position in respect of its failure to comply with the important requirements of condition 6 and the significance of those breaches.

Was the breach of condition 6 merely “technical”?

[42]   There is no dispute that prior to the installation of the fish screen neither a report containing final design plans of the fish screen nor an operation and maintenance plan was provided to the Council. Kilmarnock accepts that there was non-compliance but maintains that these requirements were of a technical nature and could not on their own support the conclusion reached by the Environment Court that Kilmarnock had failed to substantially and reasonably comply with the establishment conditions. In support of that submission, it notes that a further requirement of condition 6a, that the screen be designed or supplied by a suitably qualified person, was met and that it was only the documentation requirements of the condition that were not complied with.

[43]   I do not consider the failure to comply with the identified requirements of condition 6 can be dismissed as merely “technical”. I proceed on the basis, as was found by the Environment Court, that those conditions were “important”. In reaching that conclusion, the Court made the following finding, with which I agree:

[98] As to the importance of the establishment conditions, the requirement to provide information in relation to the fish screen allows the [Council] to oversee the design and installation of the fish screen so that it can effectively carry out its functions under the Act. That is why it is important that the fish screen design and maintenance plans are provided to the [Council] before taking of water starts ...

[44]   Other conditions requiring the provision of water metering information to the Council were also categorised as important because they allowed the Council to discharge its statutory duties to gather the information that is necessary for it to

effectively carry out its functions under the Act.14 Kilmarnock complied with those conditions and provided the relevant information to the Council on 22 September. However, it failed to provide the necessary information required by condition 6.

Did the Environment Court make an error of law in concluding that the resource consents had not been given effect to?

[45] The Environment Court placed considerable importance on the establishment conditions that required the water permit holder to provide information about the fish screens to the Council. This is apparent from its articulation of their purpose, as referred to earlier at [43]. However, the Court was also cognisant that a failure to carry out certain establishment conditions does not automatically lead to the conclusion that the resource consent has lapsed, only that it may potentially have that result and that non-compliance with such conditions is a relevant matter to be taken into account.15 It identified the most important question to be whether the establishment conditions had been reasonably and substantially satisfied – a test which Kilmarnock does not challenge as being other than appropriate.

[46]   The Environment Court referred to breaches of the metering conditions as being “minor” but, in contrast, found the establishment conditions relating to fish screening to be of much greater significance before concluding that the majority of those conditions had not been “reasonably” complied with.16 The Court’s focus in reaching that conclusion appears to have been on the requirements of condition 6. Immediately after expressing its view that there had not been reasonable compliance with the establishment conditions relating to the fish screen, the Court referred to part of Mr Fahey’s evidence.

[47]   Mr Fahey maintained that it was “not uncommon” for design and installation documentation not to be supplied and that he had not known this to be a matter that prevented a consent holder from continuing to take water pursuant to a consent. The Court did not find that consideration persuasive. It noted that Kilmarnock had already

14     Resource Manage Act 1991, s 35(1).

15     Koha Trust Holdings Ltd v Marlborough District Council, above n 5, at [39].

16     The breaches of the metering condition concerned the late installation and certification of the water meter.

had the benefit of one extension of its lapse date and was on notice to “do things right or, at least, reasonably correctly”.

[48]   The one requirement of condition 5 that the Court was satisfied had been complied with concerned the specifications of the maximum mesh width of the fish screen (5a).  That  requirement was the subject  of specific evidence  provided by  Mr Fahey who exhibited the intake screen installation form as part of his evidence. It recorded that the fish screen had a compliant maximum mesh size of 2.38 mm. By furnishing that detail a comparison was able to be made between the requirement of the condition prescribed by the water permits and the installed fish screen. No other such details relating to the specifications and design criteria of the fish screen were adduced in evidence by Kilmarnock. Those omissions led the Environment Court to find that there was no specific evidence about a number of the requirements of condition 5. At a more fundamental level, those deficiencies mirrored Kilmarnock’s failure, in breach of condition 6, to provide the necessary information to the Council which prevented it from being able to assess whether the fish screen met the criteria of the water permits.

[49]   Mr Purdon’s evidence was that a consent holder is required to submit the design report well ahead of when the water is sought to be taken to ensure that the fish screen will be compliant with the permits’ conditions. That report is referred to a water ecologist with appropriate expertise who provides feedback to the compliance officer to transmit back to the consent holder, in order to enable modifications to be made to the fish screen if these are required. This is considered a necessary step to ensure that despite the taking of surface water, which Mr Purdon affirmed presents a significant threat to freshwater fish, the fish are appropriately protected and that fully compliant fish screens are used to ensure aquatic ecosystems remain healthy and sustainable.

[50]   Proceeding on the basis of the acknowledged error of fact that condition 5c.iii had not been complied with, the issue for this Court is whether, notwithstanding that error, the Environment Court was still entitled to conclude that Kilmarnock’s failure to comply with obligations under condition 5 and, in particular, condition 6, meant the establishment conditions had not been reasonably and substantially satisfied and that Kilmarnock, as a result, had not given effect to the resource consents. In my view, the

consequences of that non-compliance were such that its failure to meet those requirements did have that effect, and that notwithstanding the erroneous factual finding of the Environment Court in relation to condition 5, its overall conclusion was both supportable and tenable and did not amount to an error of law.

Conclusion

[51]   The mistaken factual finding in relation to condition 5c.iii was not determinative of the Court’s overall decision that the establishment conditions relating to fish screening had not been reasonably and substantially satisfied. It follows that notwithstanding that error, its ultimate determination was still supported by its legitimate finding that Kilmarnock had failed to comply with the balance of the requirements of conditions 5 and 6. I consider that latter failure to have been a highly relevant matter for the Court to have taken into account and one that was central to its conclusion that the resource consents had not been given effect to. It was a finding the Court was entitled to reach despite the factual error made in the judgment. Overall, I am satisfied the decision the Court reached to decline Kilmarnock’s applications was an outcome that was available to it in the circumstances and one that did not give rise to an error of law.

Result

[52]The appeal is dismissed.

Costs

[53]   The Council is entitled to costs as the successful party. In the absence of agreement, the parties are to exchange and file memoranda (not more than three pages).

Solicitors:

Lane Neave, Christchurch Wynn Williams, Christchurch