MacPherson v Napier City Council
[2013] NZHC 2518
•26 September 2013
IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY
CIV-2012-441-000851 [2013] NZHC 2518
UNDER the Judicature Amendment Act 1972 ("the Act") IN THE MATTER OF
the Resource Management Act 1991 ("the RMA")
BETWEEN
J E MACPHERSON and N J MATHESON
Applicants
AND
NAPIER CITY COUNCIL
First Respondent
AND
WHATEVER IT TAKES TRUST INCORPORATED
Second Respondent
| Hearing: | 29-30 July 2013 |
Counsel: | M J E Williams for the Plaintiffs M B Lawson for the First Respondent M J Wenley for the Second Respondent |
Judgment: | 26 September 2013 |
_________________________________________________________________________________________________________
JUDGMENT OF DUFFY J
____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________---______________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
This judgment was delivered by Justice Duffy on 26 September 2013 at 4.00 pm, pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
Counsel: M J E Williams, Napier
Solicitors: Carlile Dowling (A J Pidd), Napier Lawson Robinson Limited, Napier Willis Toomey Robinson, Napier
MACPHERSON and MATHESON v NAPIER CITY COUNCIL and ANOR [2013] NZHC 2518 [26 September 2013]
[1] The applicants, J E Macpherson and N J Matheson, have applied for judicial review of the first respondent’s (the Council) decisions:
(a)not to notify them of the second respondent’s (the Trust) application to develop a multi-unit development on land opposite their property; and
(b)to grant resource consent to the second respondent’s application.
[2] The key issues that the Court will need to resolve are: (a) should the Council have proceeded to process the Trust’s application as one for a “controlled activity” when the application that it lodged was not made fully compliant for such activity until after a change to the District Plan that excluded proposed developments like the Trust’s from being controlled activities; (b) as the property was subject to the requirements of the Resource Management (National Environmental Standard for Assessing and Managing Contaminants in Soil to Protect Human Health) Regulations 2011 (NES Regulations), could these be addressed later in accordance with a condition attached to the consent, or did they need to be addressed as part of the process of granting consent; and (c) should the application have been publicly notified. If the answers to these questions reveal errors of law in the Council’s decision-making, then, as relief in judicial review is discretionary, the next question will be whether or not the resource consent should be set aside and the application referred back to the Council for reconsideration.
Background
[3] The applicants live in the house they own on Paradise Road, Napier. Their home is on land falling within the Napier Hill Character Zone, set under the Council’s District Plan. This zone is described in the Council planner’s report as comprising a diverse mix of housing styles, including art deco, bungalows, villas and modern architectural design. The zone has narrow roads, which, in many cases, lack footpaths. The applicants describe Paradise Road as a steep, narrow, historic road with no exit, and buildings that hark back to early settlement days. It has no footpaths and in some places old stone retaining walls line the kerb. It is a steep
road with a gradient of at least 20 per cent. There is limited on and off-street parking and turning a motor vehicle on this road is difficult.
[4] On 9 February 2012, the Trust submitted preliminary plans for its seven unit residential development for review by the Council. The proposed development is on two connected lots, one of which fronts on to 11 Paradise Road (CT 611194), and the other on to Chaucer Road South (CT 611195). The proposed development is intended to provide residential accommodation for persons with mental health difficulties.
[5] The Trust formally lodged an application for a land use consent, including a site layout plan, on 22 February 2012 (the 22 February plan). The Trust had sought to bring its application within the District Plan’s requirements for a controlled activity in the Napier Hill Character Zone, as this meant that, provided the application was compliant, the Council was obliged to grant consent. However, the plans did not comply with the District Plan standards for notional garaging. As lodged, therefore, the application was not fully compliant with the requirements for a controlled activity. In addition, as lodged, the application provided no information of the type required by reg 8 of the NES Regulations, despite the subject property being listed on the Hazardous Activities and Industries List (HAIL) and so being subject to the NES Regulations. Regulation 8 specifies the type of information that is required to be provided for the type of controlled activities on HAIL land that is covered by the NES Regulations.
[6] On 23 February 2012, the Council advised the Trust that the garaging layout was non-compliant for a controlled activity. This gave the Trust the opportunity to amend the application to make it compliant. Tania Diack, the Council planner responsible for processing this application, has acknowledged in her affidavit evidence that, if not corrected, the non-compliant garaging layout would have “tipped the proposal to restricted discretionary status”. This would have made the outcome of the application less certain, as the Council is not obliged to grant resource consent for restricted discretionary activities.
[7] On 3 March 2012, the Council notified Change 5 to its District Plan to give it the power to refuse planning approval to “multi-unit” residential developments in the Napier Hill Character Zone. The Council could do so, having regard to the effects such developments might have on the residential character and amenity values of the area, and the impacts of traffic generated on the local road network. These new criteria were introduced to the District Plan, and multi-unit residential development was reset as a discretionary rather than a controlled activity. There is no dispute that from this time onwards, in accordance with s 86B of the Resource Management Act 1991, Change 5 had legal effect.
[8] On 7 March 2012, the Trust lodged a compliant site layout plan with the Council. The non-compliance of the garaging was rectified. There was still no information provided in terms of the NES Regulations. Nor had the Council sought such information.
[9] On 15 March 2012, the Council granted resource consent for the Trust’s proposed development. In doing so, the Council treated the application as one for a controlled activity. Thus, the Council took the time of lodgement of this application as running from 22 February 2012, which of course pre-dated Change 5.
[10] The resource consent contained conditions 15 and 16, which required the Trust to obtain site investigation reports from a suitably qualified person on potential on-site contamination. The Council required this information to be provided before a building consent would be issued. The advice notes to the consent recorded that the subject land was HAIL land, referred to the NES Regulations, and explained that this was why conditions 15 and 16 were imposed. The site investigation reports on potential on-site contamination of this land were not received by the Council until April and June 2012.
[11] The first that the applicants learned of the consent having been granted was in August 2012 when site works commenced. Those works included carrying out remedial work to remove and to dispose of contaminated soil. The Trust says that up to March 2013, it had expended some $393,283.38 on the purchase and development of the subject land. It also says that it only committed to purchasing the subject land
when it understood the proposal could proceed as a controlled activity on a non- notified basis.
Legislative framework
[12] The relevant legislation is to be found in the Resource Management Act 1991 (the Act) and the NES Regulations made under this Act.
The Resource Management Act 1991
[13] The overall effect of the Act is to prohibit uses of land that are not specifically permitted under its provisions: see s 9. Here, the relevant provisions of s 9 are those relating to contravention of a national environmental standard and contravention of a district rule, which, under s 43AAB, is a rule made as part of a District Plan:
9 Restrictions on use of land
(1)No person may use land in a manner that contravenes a national environmental standard unless the use—
(a)is expressly allowed by a resource consent; or
...
(3)No person may use land in a manner that contravenes a district rule unless the use—
(a)is expressly allowed by a resource consent; or
...
[14] The Act then sets out a hierarchy of classes of activities that may be undertaken on land, starting with activities permitted as of right, and ending with prohibited activities. In the middle are a range of activities that are subject to differing degrees of control and exercise of discretion. The District Plan identifies when each of the prescribed activities applies in relation to specific demarcated zones. Apart from activities that are permitted as of right (permitted uses) and prohibited activities, the remainder require resource consent before they are permitted. The Council is a consent authority under this Act.
[15] Section 87A sets out the various classes of activity. Relevant here are controlled activities and restricted discretionary activities, and discretionary or non- complying activities, all of which require resource consent before they can be carried out:
87A Classes of activities
(1) ...
(2)If an activity is described in this Act, regulations (including any national environmental standard), a plan, or a proposed plan as a controlled activity, a resource consent is required for the activity and—
(a)the consent authority must grant a resource consent except if—
…
(b)the consent authority's power to impose conditions on the resource consent is restricted to the matters over which control is reserved (whether in its plan or proposed plan, a national environmental standard, or otherwise); and
(c)the activity must comply with the requirements, conditions, and permissions, if any, specified in the Act, regulations, plan, or proposed plan.
(3)If an activity is described in this Act, regulations (including any national environmental standard), a plan, or a proposed plan as a restricted discretionary activity, a resource consent is required for the activity and—
(a)the consent authority's power to decline a consent, or to grant a consent and to impose conditions on the consent, is restricted to the matters over which discretion is restricted (whether in its plan or proposed plan, a national environmental standard, or otherwise); and
(b)if granted, the activity must comply with the requirements, conditions, and permissions, if any, specified in the Act, regulations, plan, or proposed plan.
(4)If an activity is described in this Act, regulations (including any national environmental standard), a plan, or a proposed plan as a discretionary activity, a resource consent is required for the activity and—
(a)the consent authority may decline the consent or grant the consent with or without conditions; and
(b)if granted, the activity must comply with the requirements, conditions, and permissions, if any, specified in the Act, regulations, plan, or proposed plan.
...
(emphasis added)
[16] Section 87B provides for how activities that fall outside of the strata of classes in s 87 are to be dealt with:
87BCertain activities to be treated as discretionary activities or prohibited activities
(1)An application for a resource consent for an activity must, with the necessary modifications, be treated as an application for a resource consent for a discretionary activity if—
(a)Part 3 requires a resource consent to be obtained for the activity and there is no plan or proposed plan, or no relevant rule in a plan or proposed plan; or
(b)a plan or proposed plan requires a resource consent to be obtained for the activity, but does not classify the activity as controlled, restricted discretionary, discretionary, or non- complying under section 77A; or
(c)a rule in a proposed plan describes the activity as a prohibited activity and the rule has not become operative.
[17] Section 88 sets out the criteria for making an application for resource consent. Particularly important is the requirement in s 88(2)(b) for the application to contain sufficient information. Subsections 3 and 4 permit the Council to return an application that is incomplete so that it can be re-submitted, whereupon it is treated as a new application:
88 Making an application
(1)A person may apply to the relevant consent authority for a resource consent.
(2)An application must—
(a)be made in the prescribed form and manner; and
(b)include, in accordance with Schedule 4, an assessment of environmental effects in such detail as corresponds with the scale and significance of the effects that the activity may have on the environment.
…
(3)If an application does not include an adequate assessment of environmental effects or the information required by regulations, a consent authority may, within 5 working days after the application was first lodged, determine that the application is incomplete and return the application, with written reasons for the determination, to the applicant.
(4)If, after an application has been returned as incomplete, that application is lodged again with the consent authority, that application is to be treated as a new application.
…
[18] Section 88A provides that where an application for resource consent has been made under s 88, and the type of activity for which consent is sought is subsequently altered, the application will continue to be processed unaffected by the alteration.
[19] Section 91 allows the Council to defer dealing with an application for resource consent if it considers that the proposed activity will require other resource consents before it is permitted.
[20] Section 92 authorises the Council to seek further information from an applicant, or to commission a person to prepare a report containing the information it requires before it proceeds to consider an application for resource consent.
[21] Section 95A gives a consent authority a discretion to decide whether an application is to be publicly notified and sets out criteria to take into account when exercising that discretion:
95APublic notification of consent application at consent authority’s discretion
(1)A consent authority may, in its discretion, decide whether to publicly notify an application for a resource consent for an activity.
(2)Despite subsection (1), a consent authority must publicly notify the application if—
(a)it decides (under section 95D) that the activity will have or is likely to have adverse effects on the environment that are more than minor; or
(b)the applicant requests public notification of the application; or
(c)a rule or national environmental standard requires public notification of the application.
(3)Despite subsections (1) and (2)(a), a consent authority must not publicly notify the application if—
(a)a rule or national environmental standard precludes public notification of the application; and
(b)subsection (2)(b) does not apply.
(4)Despite subsection (3), a consent authority may publicly notify an application if it decides that special circumstances exist in relation to the application.
[22] Section 95B provides for circumstances where there may be limited notification of a consent application:
95B Limited notification of consent application
(1)If a consent authority does not publicly notify an application for a resource consent for an activity, it must decide (under sections 95E and 95F) if there are any affected persons an affected protected customary rights group or affected customary marine title group in relation to the activity.
(2)The consent authority must give limited notification of the application to any affected person unless a rule or national environmental standard precludes limited notification of the application.
(3)The consent authority must give limited notification of the application to an affected protected customary rights group or affected customary title group even if a rule or national environmental standard precludes public or limited notification of the application.
(4)In subsections (1) and (3), the requirements relating to an affected customary marine title group apply only in the case of applications for accommodated activities.
[23] Section 95D sets out the factors for consideration when a consent authority decides if adverse effects are likely to be more than minor:
95DConsent authority decides if adverse effects likely to be more than minor
A consent authority that is deciding, for the purpose of section 95A(2)(a), whether an activity will have or is likely to have adverse effects on the environment that are more than minor—
(a)must disregard any effects on persons who own or occupy—
(i)the land in, on, or over which the activity will occur; or
(ii)any land adjacent to that land; and
(b)may disregard an adverse effect of the activity if a rule or national environmental standard permits an activity with that effect; and
(c)in the case of a controlled or restricted discretionary activity, must disregard an adverse effect of the activity that does not relate to a matter for which a rule or national environmental standard reserves control or restricts discretion; and
(d)must disregard trade competition and the effects of trade competition; and
(e)must disregard any effect on a person who has given written approval to the relevant application.
[24] Whether or not someone is an affected person for the purpose of considering if the activities’ adverse effects on them are minor or more than minor is determined in accordance with s 95E:
95E Consent authority decides if person is affected person
(1)A consent authority must decide that a person is an affected person, in relation to an activity, if the activity's adverse effects on the person are minor or more than minor (but are not less than minor).
(2)The consent authority, in making its decision,—
(a)may disregard an adverse effect of the activity on the person if a rule or national environmental standard permits an activity with that effect; and
(b)in the case of a controlled or restricted discretionary activity, must disregard an adverse effect of the activity on the person that does not relate to a matter for which a rule or national environmental standard reserves control or restricts discretion; and
(c)must have regard to every relevant statutory acknowledgement made in accordance with an Act specified in Schedule 11.
(3)Despite anything else in this section, the consent authority must decide that a person is not an affected person if—
(a)the person has given written approval to the activity and has not withdrawn the approval in a written notice received by the authority before the authority has decided whether there are any affected persons; or
(b)it is unreasonable in the circumstances to seek the person's written approval.
[25] Section 104 mandates the process for consideration of applications and sets out the matters to which a consent authority must have regard. Under s 104(1)(b)(i), relevant provisions of national environmental standards, such as the NES Regulations, are mandatory considerations:
104 Consideration of applications
(1)When considering an application for a resource consent and any submissions received, the consent authority must, subject to Part 2, have regard to–
(a)any actual and potential effects on the environment of allowing the activity; and
(b)any relevant provisions of—
(i)a national environmental standard:
(ii)other regulations:
(iii)a national policy statement:
(iv)a New Zealand coastal policy statement:
(v)a regional policy statement or proposed regional policy statement:
(vi)a plan or proposed plan; and
(c)any other matter the consent authority considers relevant and reasonably necessary to determine the application.
(2)When forming an opinion for the purposes of subsection (1)(a), a consent authority may disregard an adverse effect of the activity on the environment if a national environmental standard or the plan permits an activity with that effect.
…
[26] Section 104(5) provides that the Council may grant resource consent on the basis of what it has determined the activity to be, regardless of what type of activity the application was expressed to be for. Further, under s 104(6), a consent authority may decline an application for resource consent if it considers it has inadequate information to determine the application, though in those circumstances, it must take into account the considerations in s 104(7):
(5)A consent authority may grant a resource consent on the basis that the activity is a controlled activity, a restricted discretionary activity, a discretionary activity, or a non-complying activity, regardless of what type of activity the application was expressed to be for.
(6)A consent authority may decline an application for a resource consent on the grounds that it has inadequate information to determine the application.
[27] Consent must be granted for a controlled activity application, and so the Council may only impose limited conditions:
104A Determination of applications for controlled activities
After considering an application for a resource consent for a controlled activity, a consent authority—
(a)must grant the resource consent, unless it has insufficient information to determine whether or not the activity is a controlled activity; and
(b)may impose conditions on the consent under section 108 only for those matters—
(i)over which control is reserved in national environmental standards or other regulations; or
(ii)over which it has reserved its control in its plan or proposed plan.
[28] By contrast, the Council has discretion to refuse resource consent for either a “full” discretionary activity application, or a restricted discretionary activity. In the case of the latter, the Council must consider matters over which discretion is restricted in the District Plan and may only impose conditions for those matters:
104BDetermination of applications for discretionary or non- complying activities
After considering an application for a resource consent for a discretionary activity or non-complying activity, a consent authority—
(a)may grant or refuse the application; and
(b)if it grants the application, may impose conditions under section 108.
104C Determination of applications for restricted discretionary activities
(1)When considering an application for a resource consent for a restricted discretionary activity, a consent authority must consider only those matters over which—
(a)a discretion is restricted in national environmental standards or other regulations:
(b)it has restricted the exercise of its discretion in its plan or proposed plan.
(2)The consent authority may grant or refuse the application.
(3)However, if it grants the application, the consent authority may impose conditions under section 08 only for those matters over which—
(a)a discretion is restricted in national environmental standards or other regulations:
(b)it has restricted the exercise of its discretion in its plan or proposed plan.
[29] The Council can under s 108 impose conditions on resource consents, which is how in this case it imposed the requirement for a written assessment of potential on-site contamination of the land before any building permit was issued:
108 Conditions of resource consents
(1)Except as expressly provided in this section and subject to any regulations, a resource consent may be granted on any condition that the consent authority considers appropriate, including any condition of a kind referred to in subsection (2).
(2)A resource consent may include any one or more of the following conditions:
…
(c)A condition requiring that services or works, including (but without limitation) the protection, planting, or replanting of any tree or other vegetation or the protection, restoration, or enhancement of any natural or physical resource, be provided:
(3)A consent authority may include as a condition of a resource consent a requirement that the holder of a resource consent supply to the consent authority information relating to the exercise of the resource consent.
(4)Without limiting subsection (3), a condition made under that subsection may require the holder of the resource consent to do one or more of the following:
(a)To make and record measurements:
(b)To take and supply samples:
(c)To carry out analyses, surveys, investigations, inspections, or other specified tests:
(d)To carry out measurements, samples, analyses, surveys, investigations, inspections, or other specified tests in a specified manner:
(e)To provide information to the consent authority at a specified time or times:
(f)To provide information to the consent authority in a specified manner:
(g)To comply with the condition at the holder of the resource consent's expense.
…
The NES Regulations
[30] The NES Regulations came into force on 1 January 2012. They implement a set of environmental standards designed to protect human health from potential exposure to chemical contaminants in soil. There is no dispute that the subject land is HAIL land and that it is covered by the NES Regulations. There is also no dispute that the proposed development would engage the NES Regulations.
[31] The NES Regulations mandate when an activity on HAIL land will be a permitted activity, controlled activity, restricted discretionary activity or discretionary activity. In short, depending on the degree of information provided to the Council, and extent to which requirements have been satisfied, the proposed activity will come within the definition of one of the aforementioned activities.
[32] The force of regulations enacting environmental standards can be seen from the status accorded to them by the Act. Section 43B mandates the relationship between national environmental standards and rules or consents. Rules or resource consents cannot be more lenient than an environmental standard: s 43B(3). Section 43B(4) states that a rule or resource consent will be more lenient than an environmental standard if it permits or authorises an activity that the standard prohibits or restricts. Section 44A requires a local authority to recognise environmental standards and in certain circumstances it must amend its plan or proposed plan to conform with the national environmental standard. Section 44A(7)
requires every local authority and consent authority to observe national environmental standards and, under s 44A(8), such authorities must enforce observance of national environmental standards to the extent to which their powers enable them to do so.
[33] Regulation 3 defines the types of uses and activities that engage these regulations. Regulation 3 also defines what is required for an investigation to qualify as a “preliminary site investigation” and a “detailed site investigation”.
[34] The type of investigation required and the steps to be taken for a proposal affected by these regulations to conform to their requirements for a controlled activity are set out in reg 9:
9 Controlled activities
Removing or replacing fuel storage system, sampling soil, or disturbing soil
(1)If a requirement described in any of regulation 8(1) to (3) is not met, the activity is a controlled activity while the following requirements are met:
(a)a detailed site investigation of the piece of land must exist:
(b)the report on the detailed site investigation must state that the soil contamination does not exceed the applicable standard in regulation 7:
(c)the consent authority must have the report:
(d)conditions arising from the application of subclause (2), if there are any, must be complied with.
(2)The matters over which control is reserved are as follows:
(a)the adequacy of the detailed site investigation, including—
(i)site sampling:
(ii)laboratory analysis:
(iii)risk assessment:
(b)how the activity must be—
(i)managed, which may include the requirement of a site management plan:
(ii)monitored:
(iii)reported on:
(c)the transport, disposal, and tracking of soil and other materials taken away in the course of the activity:
(d)the timing and nature of the review of the conditions in the resource consent:
(e)the duration of the resource consent.
Subdividing or changing use
(3)If a requirement described in regulation 8(4) is not met, the activity is a controlled activity while the following requirements are met:
(a)a detailed site investigation of the piece of land must exist:
(b)the report on the detailed site investigation must state that the soil contamination does not exceed the applicable standard in regulation 7:
(c)the consent authority must have the report:
(d)conditions arising from the application of subclause (4), if there are any, must be complied with.
(4)The matter over which control is reserved is the adequacy of the detailed site investigation, including—
(a)site sampling:
(b)laboratory analysis:
(c)risk assessment.
No public notification of application for resource consent
(5)The consent authority must not give public notification of an application for a resource consent to do any of the activities.
Consequence if requirement not met
(6)If a requirement described in this regulation is not met, the activity is a restricted discretionary activity under regulation 10 while it meets the requirements in regulation 10(2).
(emphasis added)
[35] If the requisite information required by regs 8 to 10 is not provided to the Council, the Council cannot classify the proposed activity under any of the heads of activity relevant to each of those regulations, namely, permitted activities, controlled
activities, restricted discretionary activities. Consequently, by default, under reg 11(1), the proposal is to be treated as a discretionary activity:
11 Discretionary activities
(1)This regulation applies to an activity described in any of regulation 5(2) to (6) on a piece of land described in regulation 5(7) or (8) that is not a permitted activity, controlled activity, or restricted discretionary activity.
(2)The activity is a discretionary activity.
[36] There is no dispute that the subject land and the proposed development are covered by reg 11.
District Plan
[37] As at 22 February 2012, r 6.10 of the District Plan provided for multi-unit residential development in the Napier Hill Character Zone to be a controlled activity provided it met the conditions specified in that rule.
[38] Rule 6.15 of the District Plan governs land uses that do not comply with required conditions. The rule provides that any use that does not comply with all the relevant conditions in the Napier Hill Character Zone activity table and condition table was to be treated as a restricted discretionary activity, unless exempted by some other rule:
6.15 Land uses not complying with conditions
1.ANY subdivision, use or development of land referred to in Rule 6.2 to 6.13 that does not comply with all of the relevant conditions in the Napier Hill character zone activity table and condition table, is a restricted discretionary activity, unless stated by a rule elsewhere in this chapter.
Rule 6.15 also specified the matters the Council would restrict its discretion to, for restricted discretionary activities. These included a number of factors which took into account the design and external appearance of multi-unit residential development, the impact this had on a particular character zone, including how the proposed development fitted with the appearance of the existing dwellings, and any
issues relating to car parking and access. Such factors were not open to the Council to consider when deciding to approve a proposal for a controlled activity.
[39] Change 5, which took effect from 3 March 2012, altered r 6.10 by making multi-unit residential developments in the Napier Hill Character Zone a discretionary activity.
Grounds of review
[40] The applicants relied on five grounds of review, some of which overlap each other in their application to the impugned decision. There are two areas of focus: the first is on the appropriate classification of the second respondent’s application and the consequences which flow from this; the second is on whether the notification provisions of the Act were properly applied.
[41] The grounds of review relating to the first area of focus allege that:
(a)The Council’s decision granting resource consent for the proposed multi-unit development rests on two material errors of law: namely, wrongly treating the application as one for a controlled activity; and failing to take into account relevant considerations relating to car parking and access and design and external appearance as required by the District Plan.
(b)The Council has acted unreasonably by failing to exercise the statutory power in s 88(3) to refuse to accept what was an incomplete application by the second respondent, and which was in law a nullity.
(c)As a result of wrongly treating the application as one for a controlled activity, the Council failed to take into account certain mandatory considerations including:
(i)Change 5; and
(ii)The relevant District Plan criteria or issues of principal concern to the applicants.
(d)The Council failed to take into account and apply the NES Regulations as part of the decision-making process for granting the consent.
[42] The grounds of review relating to the second area of focus allege that in deciding to not notify the application for consent to build a multi-unit development, the Council failed to exercise properly the discretion given to it in s 95A. How the decision not to notify is viewed will in turn depend upon whether the application was properly treated as a controlled activity.
[43] The relevant principles as to the scope and intensity of review of a decision of this kind are well settled. A helpful summary of them can be found in Petone Planning Action Group Inc v Hutt City Council HC Wellington CIV-2006- 485-405, 10 October 2006 at [36]:
As regards judicial review principles [they] could be summarised in the following propositions relevant to this proceeding:
a)All relevant considerations must be taken into account and irrelevant considerations ignored.
b)The decision must be one a reasonable decision-maker could reach on the basis of the material available to it.
c)The weight given to relevant matters is for the decision-maker, but there must be something there to which the decision-maker can give weight.
d)This Court will scrutinise the decision more closely and with a less tolerant eye than it would decisions where broad policy considerations were present and there was less impact on peoples’ lives.
[44] Satisfying the requirement to take into account relevant matters and to disregard irrelevant matters rests on the Council first recognising the right legal tests to be applied. Unless the Council asks itself the right legal questions and disregards the wrong legal questions, it may follow a decision-making process that is at odds with what is legally required of it.
Discussion
[45] Much in this proceeding rests on whether or not the application should have been treated as a controlled activity. In two respects, the 22 February 2012 application departed from the requirements for a controlled activity. First, the garaging shown on the site layout plan did not comply with the garaging layout for a development of the type that was proposed and that was properly classifiable as a controlled activity. Secondly, even though the subject land was HAIL land, and the NES Regulations were engaged, the application did not provide the Council with the type of information that reg 8 required for the application to be treated as a controlled activity.
[46] In this case, once the applicant was advised that the site layout plan for garaging was non-compliant, it sought to address this issue by amending the site layout plan to make the garaging compliant. However, by the time this was done, Change 5 had come into effect.
[47] Section 88A saves applications from the effect of changes to a District Plan that became effective after an application has been lodged. However, what is saved is the application either as it was first lodged, or as it “was treated as being for at the time it was first lodged”. As mentioned above, in this case, as it was first lodged, the application did not fully comply with the conditions for a controlled activity in two respects. It is best to deal with each separately.
[48] Regarding the non-compliant garaging, it is accepted by all the parties that under r 6.15 of the District Plan, a non-compliant application for a controlled activity was to be treated as for a restricted discretionary activity, which is a more strictly regulated activity. Neither of the respondents argued that the non-compliant garaging could be severed from the remainder of the application so that it would still qualify as being for a controlled activity. Instead, they argued that the Council had acted reasonably by going back to the Trust to seek further information from it pursuant to s 92 in order to see if the application could be made compliant with the requirements for a controlled activity.
[49] I accept that, practically speaking, it was reasonable for the Council to adopt this course rather than to refuse the application, or to proceed unilaterally to deal with it as being for a restricted activity. However, the respondents’ argument cannot overcome the impact of r 6.15 on the Trust’s application. Whilst the Council could reasonably allow the Trust the opportunity to make the application compliant with the requirements for a controlled activity, this could not in the meantime prevent the engagement of r 6.15. Were it not for Change 5, nothing would turn on this, as once fully compliant amended plans were filed, the application could then have proceeded as being for a controlled activity. But here the difficulty for the Trust is that by the time the Council had received a fully compliant application for a controlled activity, Change 5 had excluded this as an available activity for the subject land. By then, multi-unit residential development for this land had become a discretionary activity.
[50] The respondents argued that Change 5 could be ignored because s 88A overrode it. As mentioned above, s 88A is a saving provision that preserves the availability of an activity for applications that are in the process of being dealt with when something like Change 5 occurs. There is no doubt that had the Trust’s application for its proposal been fully compliant with the requirements for a controlled activity when the application was first lodged, s 88A would have preserved the availability of this activity. But that did not happen. Nonetheless, the respondents argued that the non-compliant character of the application as first lodged could not stop it from being an application for a controlled activity that was saved by s 88A. Whether this is so or not turns on the meaning of the phrase “was treated as being for at the time it was first lodged” in s 88A(1A).
[51] Section 88A provides:
88A Description of type of activity to remain the same
(1)Subsection (1A) applies if—
(a)an application for a resource consent has been made under section 88 …; and
(b)the type of activity (being controlled, restricted, discretionary, or non-complying) for which the application was made, or that the application was treated as being made under section 87B, is altered after the application was first lodged as a result of—
(i)a proposed plan being notified; or
(ii)a decision being made under [clause 10(1)] of the First Schedule; or
(iii)otherwise.
(1A)The application continues to be processed, considered, and decided as an application for the type of activity that it was for, or was treated as being for, at the time the application was first lodged.
(2)Notwithstanding subsection (1), any plan or proposed plan which exists when the application is considered must be had regard to in accordance with section 104(1)(b).
(emphasis added)
[52] The applicants argued that the phrase in s 88A(1A) “was treated as being for at the time the application was first lodged” has no application here. They contend that Parliament intended this phrase to be understood as a reference back to s 88A(1)(b), which expressly refers to the specific classifications of activities in s 87A and to those activities that are governed by s 87B. This section provides for when certain activities are “to be treated as” discretionary or prohibited activities. The applicants argued that this is how Parliament has ensured that activities that fall within the relatively less well defined classifications in s 87B are also insulated from changes to planning controls that occur after an application has been first lodged.
[53] On the other hand, the respondents argued that the application was unaffected by Change 5 because at all material times the Council was treating the application as one for a controlled activity, which was enough for it to be saved by the second limb of s 88A(1A). In this regard, the respondents advocated for a literal interpretation of the second limb of s 88A(A1).
[54] Statutory provisions are to be read in the light of “the relevant context and purposes of the Act”, rather than being read literally: see Vu v Ministry of Fisheries [2010] NZSC 162, [2011] 3 NZLR 1 at [10].
[55] Sections 87A and 87B set out a scheme for classifying the various types of activities for which a resource consent is required. Section 87A describes various specifically designated activities and mandates how each is to be dealt with when it
comes to granting resource consent. Section 87B is a wash-up provision that sets out how to deal with activities that require a resource consent but for which no specific provision has been made in the Act, Regulations, plans or proposed plans. It requires all such activities to be treated as neither discretionary nor prohibited activities.
[56] For the saving provision in s 88A(1A) to work equally, it needed to be framed in a way that allows it to cover applications for activities falling within both s 87A and s 87B. There is no reason in principle why applications that fall under s 87B should not also be saved from changes to planning controls occurring after an application for resource consent was first lodged. Accordingly, I accept the applicants’ argument that the use of the words “was treated as being for” should be understood as Parliament’s way of drawing the relatively less well defined activities provided for in s 87B within the scope of s 88A(1A). I consider that to read s 88A(1A) in this way is consistent with the context of ss 87A and B, as well as the purposes of the Act.
[57] Secondly, I consider that it would make a nonsense of the Act if the operation of the saving provision in s 88A was dependent on the attributed form that a consent authority gave to classifying an application for resource consent, which would be the outcome if I were to adopt the respondents’ literal interpretation of s 88A(1A). Such an outcome would be inimical to the purposes of the Act, when clearly the substantive character of an application is what determines how it is to be dealt with under the Act. Section 104(5), for example, authorises a consent authority to grant a consent on the basis it is for a different activity than the type of activity that the application was expressed to be for. In this way, Parliament has made the substance of an application the determinative factor, rather than the form of activity as expressed in the application.
[58] Thirdly, although in a different context, the Court of Appeal in Body Corporate 97010 v Auckland City Council [2000] 3 NZLR 513 (CA) rejected an argument that rested on challenging the form of the issue in question, stating at [50] that what was required was for the substance of the matter to be properly considered:
We reject this argument. The exact form of an application is not determinative although it must suffice to put before the consent authority the matters which it is required to consider and decisions must be made on them. An application can include incidental matters which may technically require separate consents. The consents given will be valid notwithstanding deficiencies in the form of the application, provided that appropriate procedures are followed, including notification where necessary, and the substance of the matter is properly considered. It is undesirable that the law relating to resource consent applications should descend unnecessarily into procedural technicalities. Substance is to be preferred to form (Sutton v Moule (1992) 2 NZRMA 41 at p 47).
(emphasis added)
[59] Finally, it is well settled that whenever a consent authority treats an application as being for one type of activity when it is properly classified as being for another type of activity, the consent that is granted will be vulnerable to judicial review. Against this background, I cannot see how the phrase “was treated as being for” can be read in the broad literal fashion for which the respondents contend. It follows that the application in the present case cannot be saved by s 88A(A1) simply because it was presented as being for a controlled activity, and this is how the Council chose to treat it, despite being aware at the time of the non-compliant garaging.
[60] Moreover, the second respect in which the Trust’s application was non- compliant also precludes s 88A from saving the application from the effect of Change 5. This is the impact of the NES Regulations on the application. As first lodged, the application did not meet the requirements of reg 8, which mandates the level of information to be provided if an application for a land use consent for HAIL land is to qualify as a controlled activity. By default, an absence of compliance with any of the requirements in the NES Regulations results in the activity being treated as a discretionary activity under reg 11.
[61] The Council never turned its mind to whether this aspect of the application had any impact on how it treated the application in terms of Change 5, or at all. The Trust’s application, which comprised a site layout plan and an unsigned filled-in Council pro forma application form for resource consent said nothing about the subject land being HAIL land.
[62] The NES Regulations had only come into force in January 2012 and it seems that in the early part of 2012, the Council had not realised the full impact that these regulations would have on the processing of resource consents for HAIL land. The Council should have recognised that the advent of the NES Regulations meant that s 9(1)(a) affected this proposal. Section 9(1)(a) prohibits the use of land in a manner that contravenes a national environmental standard without a resource consent. It follows that as the subject land was HAIL land, any use that was covered by the NES Regulations would on this account require a resource consent.
[63] Instead, the Council sought to address the question of the land being HAIL land by imposing two conditions on the resource consent that was required by r 6.10 of the District Plan. Those conditions required the Trust to ensure:
15)That a written assessment is to be prepared by a suitably qualified environmental engineer identifying any potential on-site contamination and must be submitted to the Council prior to the issue of a building consent. This assessment shall also address any remedial work that is required to mitigate any identified contamination on the sites. The assessment shall be completed to the satisfaction of the Senior Planner (Resource Consents).
16)Should any contamination be identified in terms of condition 15 appropriate remedial work shall be undertaken by a suitably qualified environmental engineer to mitigate the contamination prior to the issue of a building consent. All remedial work shall be completed to the satisfaction of the Senior Planner (Resource Consents).
[64] Advice note H of the resource consent informed the Trust that:
(h)As you may be aware the sites were previously used as scrap yards and scrap yards is an activity that has been identified in the Hazardous Activities Industries List (HAIL), Resource Management (National Environmental Standard for Assessing and Managing Contaminations in Soil to Protect Human Health) Regulations 2011.
HAIL is a compilation of activities and industries that are considered more likely to cause land contamination resulting from hazardous substances use, storage or disposal, therefore Council is obliged to include conditions 15 and 16 to ensure compliance is met.
[65] The reference to the NES Regulations shows that the Council was aware of them and aware that the subject land was HAIL land. But its approach to dealing with this issue in the context of a proposed use of this land was not in accordance with the NES Regulations.
[66] The Council failed to recognise that there were two separate requirements for a land use consent for this proposal. Section 9(1)(a) required a land use consent for the use of HAIL land in the way that was contemplated by the Trust. Furthermore, because the proposed development was not a permitted use under the District Plan, a land use consent was required by under s 9(3)(a). A key question, therefore, is whether the force of reg 11 should be seen to influence the classification of the whole proposal so that it was treated as a discretionary activity in all respects, or whether this classification would only apply to that part of the proposal at which the NES Regulations were aimed.
[67] There is nothing in the Act to preclude the requirements for the two land use consents being met by a single application for resource consent, and it makes good practical sense for things to proceed in this way. On the other hand, I can see nothing in the Act that would preclude separate applications for each consent. However, I do not see the latter approach as one that would through this means alone allow the proposed development to avoid the risk of the discretionary activity classification under reg 11 being applied to the whole proposal. This is because where consents are seen to be inter-connected, the Act allows a consent authority to defer making a decision on one consent until all relevant consents are lodged: see s 91.
[68] Where a proposal involves two or more consents, whether they are treated as one, or viewed separately will turn on the extent to which they overlap each other. On a number of occasions, the courts have been faced with proposals involving activities that require two or more consents and the question has been whether the whole proposal should be considered in terms of the rules for the more strictly controlled activity, or whether each proposed activity can be dealt with discretely. On occasion, the courts have found that a holistic approach is preferable and so the proposal has been considered entirely in terms of the most strictly controlled activity,
whereas on other occasions the courts have taken what has been termed a hybrid or component based approach, which has seen different activities viewed individually in terms of their respective activity classification.
[69] In Bayley v Manukau City Council [1999] 1 NZLR 568, [1998] NZRMA 513 (CA), the Court of Appeal was faced with a case where multiple land use consents were required, one of which did not require notification, whereas the others did. The proposed development was for a residential activity in a business zone and so under the relevant District Plan it was a controlled activity. However, two aspects of the proposed development required restricted discretionary consents. These were the access arrangements and a side-yard, which involved spiral staircases, small first floor decks and ground floor closets intruding into the minimum side-yard space.
[70] The question was whether the Council should have notified all consents or only those requiring notification. The Court of Appeal considered that each land use consent could be dealt with separately where the effects to be considered in relation to each application were “quite distinct”, but otherwise it considered that the consideration of all consents should be approached in the light of the conditions imposed for the most strictly controlled activity. The Court of Appeal found that the consent authority was wrong to view the non-compliant aspects of the proposal separately, finding instead that the three consents for this proposal needed to be looked at in the round:
Section 94(1)(b) and the provisions of the Council’s proposed plan permit non-notification of such an application without written approval of affected persons but do not require the Council to dispense with notification. (It “need not be notified”.) Such a course may be inappropriate where another form of consent is also being sought or is necessary. The effects to be considered in relation to each application may be quite distinct. But more often it is likely that the matters requiring consideration under multiple land use consent applications in respect of the same development will overlap. The consent authority should direct its mind to this question and, where there is an overlap, should decline to dispense with notification of one application unless it is appropriate to do so with all of them. To do otherwise would be for the authority to fail to look at a proposal in the round, considering at the one time all the matters which it ought to consider, and instead to split it artificially into pieces.
The Council does not appear in this case to have appreciated the need to approach the question of the notification of the applications in this way and thus has erred fundamentally in the exercise of its discretion under s
94(1)(b). The criteria for assessment of the controlled activity included site layout and vehicle and pedestrian access, which were of course matters which had to be considered in relation to the restricted discretionary activity consent applications. All applications should have been notified.
(emphasis added)
[71] In Body Corporate 97010, there was a challenge to a decision that a resource consent application for an apartment building need not be notified. Two kinds of resource consent were required: a controlled activity consent for dwelling units in the zone; and a discretionary activity consent because car parking spaces were to be stacked. Neighbours who were concerned about the visual effects of the blocks submitted that the Council should have treated the whole application as a discretionary activity. Randerson J in the High Court rejected that argument. He considered (at [18]) that even if the discretionary activity application were refused:
... the evidence is that, at worst, one of the residential apartment levels would have been converted to provide additional complying parking. There would be no effect on the size, shape, or location of the building on the site and it could not be said that consideration of the parking issue would affect the outcome of the controlled activity consent for the building as a whole.
(emphasis added)
[72] The Court of Appeal confirmed this finding (at [22]):
The effects of the car parking in this case were distinct in the sense that, unlike the staircases and decks in Bayley, the arrangements proposed for it had no consequential or flow-on effects on the matters being considered under the controlled activity application... There was in this case no overlap and therefore no need for an holistic approach.
Furthermore, as the Court of Appeal noted (at [19]):
Because the Council had no power to impose a condition about the height or bulk of the building or materially affecting its location, any adverse effects on the persons represented by the appellant could not have been addressed if the application had been notified. No purpose would have been served by requiring notification.
Accordingly, the Court of Appeal found that the Council was therefore entitled to consider the two resource consents separately.
[73] Tairua Marine Ltd v Waikato Regional Council HC Auckland CIV-2005-485- 1490, 29 June 2006, concerned an application for the development of a marina. The dredging required to create the marina was a non-complying activity. The Environment Court considered that it should apply this most stringent status to the whole proposal, including the discretionary activity and restricted discretionary activities (being the proposed reclamation, parking and recreational activities). Asher J confirmed the Environment Court’s finding (at [30]-[31]):
It is a longstanding principle that where there is an overlap between two consents, so that the consideration of one may affect the outcome of the other, it will generally be appropriate to treat the application as one requiring overall assessment on the basis of the most restrictive activity: Bayley v Manukau City Council [1999] 1 NZLR 568 at 576, King & Ors v Auckland City Council (2000) NZRMA 145...
... there is overlap between the dredging and the other proposed activities. The dredging lies at the heart of the Project. There will be no marina until a very substantial dredging exercise is carried out. The proposed all tide marina will be situated on an area which is totally exposed to the tide at present. Presumably the dredging will be expensive and will have to exceed two metres in depth for large parts. The dredged material is estimated to amount to 142,000 cubic metres. The disposal of those dredged tailings creates an immediate environmental issue.
[74] Asher J distinguished the case in front of him from Body Corporate 97010 (at [35]):
It can be readily seen in that case how issues as to complying parking had no effect on the size, shape and location of the building and on the site, and did not affect the outcome of the controlled activity consent for the building as a whole. In this case the dredged material will have consequential and flow-on effects. Without dredging and the proper disposal of dredged material, the proposed marina cannot possibly proceed. As I have stated, the environmental effects on dredging and disposal of the dredged material are key issues in the application. There is therefore a need for what is referred to in Body Corporate 97010 (para [22]) as “an holistic approach”.
[75] In Newbury Holdings v Auckland Council [2013] NZHC 1172, the question was whether it was appropriate for the Environment Court to bundle applications in terms of both district and regional plans. The bundling of the plan meant that the activity status under the district plan changed from discretionary to non-complying. Applying Tairua, the High Court found that the Environment Court was correct to find that the plan was non-complying overall. At [61], the Court stated:
In the present case, there is significant overlap in the district and regional plans and in the individual activity consents within those plans.... What is decided under one plan will inevitably impact upon the other, as evidenced by the fact these proceedings having occurred because T R Group received consent under one plan but not the other. Therefore it makes sense both for the different activity consents to be bundled together (as is the norm when they overlap) and also for the activity consents in two different plans to be bundled together when they also overlap.
[76] Turning to consider the Trust’s proposal, whether the land could be built on at all and, if so, how any soil contamination was to be dealt with, depended on the proposal satisfying the NES Regulations. At the same time, the nature of what those regulations would require before any proposal was permitted to go ahead would be influenced by what it was that was being proposed. In this way, the consideration of each would affect the other, so each was mutually co-dependent on the other. Just as in Tairua there could be no marina development without the dredging, here there could be no construction of the multi-unit residential development without some disturbance to the soil of the kind that engaged the NES Regulations.
[77] Since the advent of the NES Regulations, I find it difficult to see how any proposed use of HAIL land could be consented to without the consent authority first being satisfied that the proposal complied with the NES Regulations. These regulations provide a scheme governing the uses of land that is listed as having potential adverse effects on human health from historic persistent chemical contaminants in the soil. Their scheme and purpose are directed at addressing rising concern about the potential detriment of the use of such land on human health. By addressing this concern in a national environmental standard in a way that directly makes proposed activities on affected land classifiable as one of the described activities in the Act, the Executive has sought to ensure that there is a uniform approach to addressing the concerns that these regulations were intended to deal with. Whether resource consent for a use of such land is required then depends upon where the proposed activity sits on the classification hierarchy provided in regs 7 to
10. In this way, strict, uniform and predictable controls are imposed on the use of HAIL land. This is quite different from the attachment of individualised conditions to assess the HAIL implications on a granted resource consent for a particular proposal, which is what was done here.
[78] Thus, I see the circumstances here as comparable to those in Bayley and in Tairua, which means that the overall assessment of the proposal should have been considered on the basis of a discretionary activity, as this was the most restrictive activity. Once seen in this way, the Council’s approach to treat the application as one for a controlled activity was wrong. It follows that the wrong treatment of an application as a controlled use could never, even on a literal interpretation of s 88A(1A), extend to save this circumstance from being affected by Change 5.
[79] Furthermore, the resource consent conditions 15 and 16 did not replicate the very specific requirements that reg 8 imposes before a proposed use of HAIL land can qualify as a controlled activity. Whilst the investigations the Trust commissioned in April appear to match the reg 3 definition of a preliminary site investigation, and the report of June of 2012 appears to match the definition of detailed site investigation, the conditions did not require this. Neither the form nor the substance of conditions 15 and 16 went as far as the requirements of reg 8, which means that insofar as the conditions were more lenient than the NES Regulations, the conditions would have been in contravention of s 43B.
[80] There is also the fact that s 44A requires every local authority and consent authority to observe and to enforce the observance of national environmental standards. Here, by failing to process the Trust’s proposal in accordance with the NES Regulations, the Council inadvertently overlooked its statutory obligation to fully observe the NES Regulations.
[81] There remains the question of notification. The findings I have already made on the errors in the Council’s decision-making mean that it is unnecessary to determine this question. Nonetheless, I will address it briefly. The Council’s decision not to notify this application was based on it being for a controlled activity. Once the application is recognised as properly being for a discretionary activity, it becomes clear that the Council’s decision on notification will necessarily be flawed because it did not ask itself the questions relevant to when a discretionary activity need not be notified. Thus, the considerations it took into account and those which it did not will be quite different from those for deciding whether to notify a discretionary activity.
[82] Even if I am wrong on the overlap between the need for resource consent for use of HAIL land and the need for resource consent to build on the subject land, so that each can be dealt with separately, the finding that I have made regarding the non-compliant aspects of the garaging mean that at best for the respondents, the proposed multi-unit residential development would be a restricted discretionary activity, with the use of HAIL land being a discretionary activity. So again, the decision on notification would have to be approached differently from one involving a controlled activity.
[83] The applicants argued that the application as lodged with the Council was so deficient in the information it provided that I should find it to be a nullity in accordance with AJ Burr Ltd v Blenheim Borough Council [1980] 2 NZLR 1 (CA). Although this decision pre-dates the Act, it is still seen as being relevant: see Central Plains Water Trust v Ngai Tahu Properties Ltd [2008] NZCA 71. It is not necessary to determine this argument. However, I consider that the application lodged was not so deficient that it would constitute a nullity. It was certainly incomplete insofar as it did not address the NES issues, and so I consider that it was premature of the Council to proceed to grant the consent, let alone to do so on the basis that it did. However, the Act allows in s 91 for applications to be deferred until any inter-related consent is also applied for. The Act also allows a Council to call for further information (s 92). Furthermore, the NES Regulations and the District Plan provided default positions for the application’s deficiencies. Here, the non- compliant garaging could, in principle, be accommodated by r 6.15 requiring the proposal to be treated as for a restricted discretionary activity. Moreover, the cumulative impact of the overlapping nature of the requisite consents and reg 11 made the entire proposal a discretionary activity, so it is not as if it was substantially deficient. As lodged, the application could be made sense of and it could be processed; all that its deficiencies did were to preclude it from being processed as a controlled activity, which is how the Trust wanted it to be approached.
[84] The Act also allows for incomplete applications to be rejected. The Court of Appeal in Central Plains Water Trust considered an application falling under this provision to be comparable to an application that would under the earlier legislation be seen to be a nullity. However, I consider that for an application to be seen as
incomplete in that way, it must in substance be beyond saving in terms of recourse to ss 91 and 92.
[85] Therefore, I do not consider that the Council’s application was a nullity. But I am satisfied that the applicants have shown that the Council’s decision is flawed in terms of administrative law. Having shown this, the next question is whether the applicants should be granted the relief that they seek.
Relief
Applicants’ submissions
[86] The applicants argued that the errors in the Council’s decision-making were not mere technicalities, but errors of substance, that warranted the resource consent being set aside and the decision being freshly determined. They also argued that it would not necessarily follow that the same outcome would result from a fresh decision.
[87] They contend that there is no question of delay affecting the granting of a remedy as they acted within a reasonable time to bring this proceeding. Because there was no notification of the Trust’s application, the first the Paradise Road and Chaucer Road community knew of the application was when the preparation works commenced, which was in August 2012. Accordingly, the commencement of the proceeding in December 2012 was prompt.
Council’s submissions
[88] The Council argued that the modern approach to the Court’s exercise of discretion to grant relief is to look at substance, rather than form: Just One Life Limited v Queenstown Lakes District Council [2003] 2 NZLR 411 (HC). With regards to the NES issue, the Council argued that the issue is one of timing, which is now completely academic because the contamination of the subject land has been largely remediated. Thus, the error is at the lowest order of gravity due to the absence of any consequences arising out of the error. Here, the Council argued that
compliance with the relevant environmental standard was achieved by the conditions of the consent, and so the purpose of the NES was still met.
[89] The Council also contended that fact that remedial action has been taken means that the same outcome, namely granting of a controlled activity multi-unit development, is inevitable. Here, the Council contended that there has not been and will not be any on-going prejudice to the applicants. Accordingly, it submitted that the denial of relief would be entirely consistent with the purpose of the RMA, the outcomes of the District Plan and established precedent.
The Trust’s submissions
[90] The Trust stated that in February 2012, it entered into agreements for the sale and purchase of the Paradise Road and Chaucer Road properties that were subject to completion before 27 April 2012 of a due diligence process, which included obtaining the resource consent. On the basis of obtaining the resource consent, the second respondent declared the contracts unconditional and completed settlement of the purchases on 9 August 2012. Therefore, to grant the application for judicial review would cause loss, undue delay, and additional expense to the second respondent, which has at all times acted in good faith and in reliance on the granting of the resource consent. Its position, in essence, is that it has altered its position in reliance on the Council granting consent on the basis that it did.
Discussion
[91] Once a plaintiff has established that the action challenged was unlawful, it is not necessary for them to go further and show that there is additional justification to receive a remedy: G Taylor Judicial Review: A New Zealand Perspective (LexisNexis, Wellington, 2010) at 138. As the Court of Appeal stated in Just One Life Ltd v Queenstown Lakes District Council [2004] 3 NZLR 226 (CA) at [39]:
[A] discretionary withholding of relief is not the normal outcome of a successful attack on a reviewable decision. If some form of relief could have practical value then it ought to be granted.
[92] In Air Nelson Ltd v Minister of Transport [2008] NZCA 26, [2008] NZAR 139, at [60], the Court of Appeal confirmed this view, stating that “there must be extremely strong reasons to decline to grant relief”.
[93] Nonetheless, the Court has a residual discretion to refuse to grant relief and this must be exercised in a principled way: see Barker v Queenstown Lakes District Council [2006] NZAR 716 (HC) at [54]. The factors relevant to the exercise of discretion as to whether or not to grant relief include: delay, the gravity of the error, the absence of injustice, and the inevitability of the outcome. Some of these factors overlap.
Delay
[94] Delay, especially when coupled with a third party being adversely affected, can lead to a denial of relief. In Green v Auckland Council [2013] NZHC 2364 at [138], Priestley J stated:
In general terms, depending on the facts, if a third party has been adversely affected by delay the remedy of judicial review may be refused. The principles were discussed in Turner v Allison. The remedy sought, as the date of the case suggests, was not judicial review but the prerogative writ of certiorari. The Court of Appeal considered that a long period of time during which the respondents remained inactive was a barrier to the Court exercising its discretion in their favour.
[95] In this case, the applicants did not apply for interim relief. However, following the commencement of the proceeding in December 2012, all parties acted to expedite the hearing of the judicial review. A joint consent memorandum dated 4 February 2013 shows that the parties were prepared to accept a fixture from 22 April 2013 onwards. It is hard to see how an application for interim relief would have made any difference, or that it might have been heard before the substantive hearing. I am satisfied that this is not a case where delay would be a disentitling reason for refusing to grant relief.
Gravity of the error, absence of an injustice, practical value of the relief and inevitability of outcome
[96] I consider that these grounds for refusing relief overlap each other. Therefore, I will deal with them together.
[97] In Wilson v Auckland City Council (No 2) [2007] NZAR 711 at [69], Venning J considered that the following observation from A J Burr Ltd v Blenheim Borough Council was relevant to his decision whether to grant relief:
When a decision of an administrative authority is affected by some defect or irregularity and the consequence has to be determined, the tendency now increasingly evident in administrative law is to avoid technical and apparently exact (yet deceptively so) terms such as void, voidable, nullity, ultra vires. Weight is given rather to the seriousness of the error and all the circumstances of the case. Except perhaps in comparatively rare cases of flagrant invalidity, the decision in question is recognised as operative unless set aside. The determination by the Court whether to set the decision aside or not is acknowledged to depend less on clear and absolute rules than on overall evaluation; the discretionary nature of judicial remedies is taken into account.
(emphasis added)
[98] Venning J then stated (at [74)]):
Where the error that has occurred is in the nature of a technical error and has occurred in the exercise of good faith the Court is entitled to approach the matter with an awareness of the needs of public administration and that good public administration is concerned with substance rather than form (see R v Monopolies and Mergers Commission ex parte Argyll Group plc [1986] 1 WLR 763).
[99] In Barker v Queenstown Lakes District Council at [55]-[56], Fogarty J further dissected the concept of the “gravity of the error”. He quoted the judgment of Somers J in Hill v Wellington Transport District Licensing Authority [1984] 2 NZLR 314:
But it does not follow that to establish some want of legality on the part of a tribunal or authority will ipso facto lead to the setting aside of its order or decision. Such a result will depend on the gravity of the error in the context and circumstances of the case. This too emphasises that a decision by a Court of competent jurisdiction is necessary to establish invalidity.
(emphasis added)
[100] Fogarty J expanded on this by stating:
The concept of “gravity of the error” has two dimensions. First, and foremost, it is to be measured against the statutory provision being exercised by the decision maker under review. Consideration of the decision maker’s statutory power needs to have regard not only to the text of that power but to its purpose. The second dimension of the gravity of error is to examine the consequence of the error on private interests, that is, citizens who are directly, or by way of indirect effect on their property, adversely affected by the error.
[101] In Akaroa Marine Protection Society Inc v Minister of Conservation [2012] NZHC 933, [2012] NZAR 655 at [70], Whata J stated:
The Court of Appeal [in Rees v Firth [2011] NZCA 668, [2012] 1 NZLR 408] referred to an article by Dr Gerard McCoy, "Public Law Potpourri". Dr McCoy refers to cases where relief was refused, it appears primarily on the basis that no injustice would arise from such refusal. I can readily accept that the absence of an injustice would provide a sound basis for declining relief. However, an underlying premise of judicial review, as I have said, is the maintenance of the rule of law and it is the role of this Court to see that it is maintained.
(footnotes omitted)
[102] I consider that the errors the Council made in granting the resource consent are serious and more than just technical defects of no possible consequence. I reject the Council’s argument that its only error was of timing when it came to addressing the potential soil contamination of the subject land, and that the error has since been cured by the requisite remedial work that the Trust has undertaken. I reject, therefore, the Council’s consequential argument that if the application were to be sent back for reconsideration, the proposal would still be considered as a controlled activity, so that the same outcome would be inevitable. The argument assumes that apart from the non-compliance with the NES Regulations, the application in all other respects complied with the requirements for a controlled activity at the time it was first lodged. But I have found this was not so. The non-compliant garaging layout meant that, putting compliance with the NES Regulations to the side, at best for the Trust, the application was, by operation of r 6.15 of the District Plan, a restricted discretionary activity when first lodged. This means that since the advent of Change 5, the application could never have been processed as a controlled activity.
[103] In Turners & Growers Horticulture Ltd v Far North District Council [2012] NZHC 1142, [2012] NZRMA 435, Turners & Growers successfully applied for judicial review of the Council’s decision to grant a certificate of compliance to Northland Waste Ltd. In deciding to grant relief, Gilbert J refused to accept that it would be pointless to grant relief (at [57]-[59]):
Northland Waste presented a significant amount of evidence with the aim of demonstrating that any error of law by the Council in granting the certificate was inconsequential because the same outcome would be inevitable, even if the decision is set aside and the matter is referred back to the Council for reconsideration.
I am not satisfied that it would be pointless to grant relief in this case. The additional information provided in these affidavits underscores the fact that the Council had insufficient information to make a proper decision in the first place. The Council will need additional information about the proposal to enable it to consider the scale, intensity and character of the proposed operation and whether a certificate should be granted. I cannot anticipate what that further information will be or whether the proposed activity, once fully explained and delineated, will comply fully with all relevant rules in the District Plan. That assessment should be made by the Council, not by this Court.
The decision whether or not to issue a certificate under s 139 is an important one for Turners & Growers and for Northland Waste. It may well affect other parties as well. For the reasons I have given, I consider that the decision- making process which led to the issue of the certificate to Northland Waste was flawed. The errors cannot be dismissed as trivial or of no possible consequence. In all of the circumstances, I am satisfied that the interests of justice require me to exercise my discretion to grant relief in this case.
[104] In the present case, the non-compliant garaging was not a minor technical issue, and no one argued that it was. The report of the Council’s services engineer report of 5 March 2012 stated:
This is a very tight development that puts pressure on many of the rules in the code and may need further changes to meet code requirements.
[105] The evidence shows that Paradise Road is a narrow, steep road and that the presence of a seven unit residential development would require provision for sufficient off-road parking to avoid exacerbating existing traffic problems resulting from additional on-road parking. So once the proposal is recognised not to be a controlled activity, the concerns the Council’s services engineer has identified may take on a greater more influential importance. Thus, the same outcome is by no means inevitable if the decision to grant consent has to be reconsidered.
[106] Secondly, I do not regard the non-compliance with the NES Regulations as a mere technical contravention. The Council by-passed the entire scheme of the Regulations and replaced them with a condition that did not itself stipulate full compliance with the regulatory regime. This omission undermines the integrity of the NES regime, as well as the Council’s statutory obligations under the Act to observe national environmental standards.
[107] The Trust argues that it has at all times acted in good faith and in reliance on the granting of the resource consent. It entered into agreements for the sale and purchase of the subject land on the condition that resource consents were obtained, and they became unconditional once the consent was granted. The Trust submitted, therefore, that if the Court granted relief to the applicants, it will be subject to loss, undue delay and additional expense. I accept that the Trust will suffer the consequences of the Council’s errors. But the Trust must also bear some responsibility. Its application was deficient. With the prospect of Change 5 coming into effect, the Trust should have should realised that the opportunity to have the proposal considered as a controlled activity was now brief, and unless it ensured its application was fully compliant for this activity, it ran the risk of being set aside by a successful legal challenge.
[108] I consider this case to be analogous to Turners & Growers Horticulture Ltd
and to Akaroa Marine Protection Society.
[109] In Turners & Growers Horticulture Ltd, Gilbert J was not prepared to second- guess what the outcome of a reconsidered decision might be. I consider that the same applies here. The contemporaneous reports from the Council describe the development as “very tight” in terms of a controlled activity. How it would have fared if it was not a controlled activity is not for this Court to determine. But I am satisfied that the same outcome cannot be assumed.
[110] I have found that r 6.15 of the District Plan made the proposal a restricted activity and that reg 11 made it a discretionary activity. Because I found the need for consent to meet the NES Regulations and the consent to use the land for multi- residential development overlapped, the appropriate activity was to be classified
according to the most restricted activity, which was a discretionary activity. That is how it presented before Change 5 took effect. Accordingly, even before Change 5 changed the permissible activity for this proposal in this zone to a discretionary activity, that is how it should have been approached.
[111] Clearly, the move effected by Change 5 has been prompted by a recognition that this is the better way to manage proposals in this particular zone for multi-unit residential development. This suggests to me that the applicants and other local residents are likely to be prejudicially affected if the proposal were to continue as a controlled activity.
[112] Whilst the saving provision in s 88A is there to protect applications that have already been lodged from changes like Change 5, Parliament did not intend it to save such applications when they are so deficient that they do not comply with the requirements of the activity for which they are presented and instead are in substance amenable to stricter controls.
[113] In this regard, I consider the comments of Whata J in Akaroa Marine Protection Society regarding the need for the maintenance of the rule of law to be relevant. Here, the Council displayed, albeit inadvertently, a serious disregard for the resource management requirements that it is obliged to adhere to. The result has been the approval of a proposal according to a more liberal control than was lawfully applicable at the time. The applicants are entitled to expect the Council to discharge its statutory role properly, which includes determining applications for resource in accordance with the correct controls.
[114] It follows that the applicants are entitled to the relief they seek. The decision of 15 March 2012 to grant resource consent to the Trust’s proposal is invalid and is, therefore, set aside. It is to be reconsidered in accordance with the law as I have found it to be.
Result
[115] The application for judicial review is successful. The decision under review is set aside and returned to the decision-maker for reconsideration.
[116] Leave is reserved to the parties to file memoranda as to costs.
Duffy J
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