Olliver Trustee Limited v Minister for Land Information
[2015] NZHC 1566
•6 July 2015
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2015-485-000299 [2015] NZHC 1566
IN THE MATTER of the Public Works Act 1981 IN THE MATTER
of an appeal under section 299 of the Resource Management Act 1991 and section 24(14) of the Public Works Act
1981
BETWEEN
OLLIVER TRUSTEE LIMITED First Appellant
ST HELIERS CAPITAL LIMITED Second Appellant
AND
MINISTER FOR LAND INFORMATION Respondent
Hearing: 3 July 2015 Counsel:
K A Wilson for Appellants
J R Burns and R Wanigasekera for RespondentJudgment:
6 July 2015
JUDGMENT OF COLLINS J
Summary of judgment
[1] This judgment explains why I am dismissing appeals brought by Olliver Trustee Ltd and St Heliers Capital Ltd (the appellants) from a report of the Environment Court to the Minister for Land Information (the respondent) pursuant to s 23 of the Public Works Act 1981 (the Act).1
[2] In its report, the Environment Court upheld in all but one respect, notices of intention to take land (the notices) issued by the respondent pursuant to s 23 of the
1 Olliver Trustee Ltd v Minister for Land Information [2015] NZEnvC 55.
OLLIVER TRUSTEE LIMITED v MINISTER FOR LAND INFORMATION [2015] NZHC 1566 [6 July 2015]
Act in relation to part of the appellants’ land. The notices included an intention to acquire four leasehold interests in relation to part of the appellants’ land for a term of two years with a right of renewal for a further two years. In its report the Environment Court removed from the terms of the proposed leases the right to renew the leases for a further two years.
[3] The appellants’ appeal is dismissed because they have failed to demonstrate
any error of law in the Environment Court’s report.
Context
[4] The appellants own two parcels of land at 77 and 109 Kapiti Road, Paraparaumu (the land). Mr Olliver is the sole director of the appellants.
[5] The land comprises approximately 32.5 ha. Part of the land is required to facilitate the construction of State Highway 1 known as the “MacKays to Peka Peka Expressway” (the Expressway). In broad terms, part of the land is required by the New Zealand Transport Agency (the Agency) for road, bridge and storm water works.
[6] St Heliers Capital Ltd purchased 77 Kapiti Road in October 2010. Olliver Trustee Ltd purchased 109 Kapiti Road in July 2013. The appellants purchased the land after the Agency had commenced the processes required under the Act before the respondent could issue the notices to take the land in question. Those steps included St Heliers Capital Ltd being advised in May 2011 that parts of 77 Kapiti Road were required for the Expressway.
[7] In May 2011, the Agency commenced negotiating with Mr Olliver to try and reach agreement to acquire the relevant parts of the land. Those steps were taken pursuant to s 17 of the Act. The efforts to negotiate an agreement were extensive and very detailed.
[8] At one negotiation meeting held on 28 May 2014, the Agency offered to modify the conditions of the proposed access agreement to ensure the appellants had access to 109 Kapiti Road and to ensure the balance of the land did not become
temporarily landlocked. The Agency also offered to record in the proposed agreement that the Agency would not prevent the appellants from having access to
109 Kapiti Road.
[9] At a further negotiation meeting held on 20 June 2014, the Agency suggested the appellants’ access to 109 Kapiti Road be addressed by inserting a vehicle crossing into a proposed agreement. At the same time, the Agency made it clear that the leases it was proposing to take would be for a maximum of two years.
[10] Unfortunately, the attempts to negotiate an agreement failed.
[11] In July 2014, the respondent served nine notices under s 23 of the Act to take the parts of the land required for the Expressway.
[12] The notices stated the respondent intended to take:
(1)a complete transfer of title in relation to three parcels of land required for road, bridge and storm water works;
(2)a lease for two years in relation to four parcels of land to enable temporary occupation of those areas during the construction of the Expressway. The notices contained a right for the respondent to renew the leases for a further two years; and
(3)two easements for the installation, occupation and maintenance of a storm water pipe.
[13] The appellants objected to the taking of the relevant parts of their land. The notices of objection referred to all of the land that was proposed to be taken. However, the focus of the appellants was primarily upon the land required for the proposed storm water works. The appellants’ objections were heard by the Environment Court on 20 and 21 January 2015. At the outset of the hearing counsel for the respondent made it clear that the proposed leases were to be for a maximum of two years.
[14] On 5 February 2015, the respondent filed a memorandum with the
Environment Court. In that memorandum the respondent confirmed:
(1)that the term of the proposed leases was to be for a maximum of two years and that the respondent did not require any right of renewal;
(2)the appellants intended to carry out their own development of their remaining land and required continuous access to the proposed lease land and the balance of their land;
(3)the respondent agreed to exercise its rights under the lease so that the appellants would not be prevented from accessing the lease land except that part of the land required to install an easement facility and only while the easement facility was being installed; and
(4)the appellants could plant vegetation but not grass or shrubs on part of the lease land.
[15] The Environment Court issued a minute on 9 February 2015, inviting the appellants to respond to the respondent’s memorandum. The appellants advised the Environment Court that the respondent’s memorandum of 5 February 2015 was irrelevant and should not be taken into account when considering the appellants’ objection. In a further minute the Environment Court explained the question of relevance of the description of the land in question was for it to resolve. The appellants then filed a further memorandum reiterating their view that the proposed taking of land was not fair, sound or reasonably necessary to achieve the respondent’s objectives.
[16] The Environment Court issued its report to the respondent on 1 April 2015. The report is a comprehensive and carefully reasoned decision comprising 130 paragraphs. In its report the Environment Court recorded the Agency had gone beyond what would normally be expected in trying to negotiate an agreement and
address the appellants’ concerns.2
2 Olliver Trustee Ltd v Minister for Land Information, above n 1, at [88].
[17] The Environment Court dismissed the appellants’ objections but deleted the
right of renewal in relation to the leasehold interests the respondent intended to take.
[18] On 23 April 2015, the appellants filed a notice of appeal. That notice was amended on 18 June 2015. Three grounds of appeal are relied upon:
(1)The Environment Court erred in law when it concluded that the proposed taking of land by the Minister is fair, sound and reasonably necessary for achieving the Minister’s objectives when, on its own summary of the evidence, the length of time stated in the notice of intention exceeded the Minister’s requirements.
(2)The Environment Court failed to take into account the evidence showing that the Agency had agreed to amend the proposed easements so they actually reflected the respondent’s need for the land.
(3)The Environment Court erred in taking into account the memorandum on behalf of the Minister dated 5 February 2015.
Legal principles
[19] The statutory power of the Crown to compulsorily take land for public works dates back to at least the reign of Henry VIII.3 Hugo Grotius appears to have been the first to refer the right of the Crown to compulsorily acquire private land for public works as part of the concept of “eminent domain”.4
[20] The compulsory acquisition of land by the Crown involves significant
interference with an individual’s property rights. The Crown’s powers when
compulsorily acquiring land must therefore be strictly construed.5
3 Act concerning the River in Canterbury: 6 Henry VIII, c 17; Act for mending the River at
Exeter: 31 Henry VIII, c 4.
4 GW Hinde, NR Campbell, Peter Twist Principles of Real Property (LexisNexis, Wellington,
2007) at [2.020].
5 Deane v Attorney-General [1997] 2 NZLR 180 (HC) at 191.
[21] The Act sets out a carefully prescribed cascading process designed to strike a balance between the public interest in the Crown or a local authority acquiring land for public works,6 and the rights of land owners whose land is required for public works. The process set out in the Act commences with a regime for acquisition of land by agreement,7 and progresses to a system for the compulsory acquisition of land,8 which ultimately is acquired by proclamation issued by the Governor-
General.9 Each step in the statutory regime is carefully calibrated to ensure the
rights of landowners are not compromised more than is reasonably necessary.
[22] The importance of reasonableness in the statutory process was made in the following way by Upjohn LJ (as he then was) in Simpson’s Motor Sales (London) Ltd v Hendon Corporation:10
… The underlying assumption of Parliament is that in conferring compulsory powers upon statutory authorities for public purposes, the acquiring authority will act reasonably in the public interest, that is, not only in the interests of their own ratepayers or shareholders, as the case may be, but with due regard to the interests of the person being dispossessed.
[23] Similar observations were made by Baragwanath J in Waitakere City Council v Brunel, when he said:11
… Rather than an exercise in arbitrary power, [the power of compulsory acquisition] is one of democratic process by, in this case, a council possessing the authority of an elected body, subject to review by the Environment Court according to criteria that it be fair, sound and reasonably necessary.
[24] Section 23 of the Act prescribes the steps which the respondent or a local authority must follow when land, other than Crown land, is to be compulsorily acquired for any public works. That procedure revolves around the issuing of notices of intention to take the land in question. Notices should include an adequate
description of both the land and the purpose for which it is to be used.
6 “Government work” and “local work”; Public Works Act 1981, s 16.
7 Public Works Act 1981, s 17.
8 Public Works Act 1981, ss 23-25.
9 Section 26.
10 Simpson’s Motor Sales (London) Ltd v Hendon Corporation [1963] Ch 57, at 83.
11 Waitakere City Council v Brunel [2007] NZRMA 235 (HC) at [47]; see also Seaton v Minister for Land Information [2013] NZSC 42, [2013] 3 NZLR 157 at [47].
[25] Under s 23(3) of the Act, every person having an estate or interest in the land that is subject to the notice may object to the Environment Court to the taking of the land.
[26] Section 24 of the Act sets out the procedures to be followed when the Environment Court hears an objection to a notice of intention to take land. Section 24(7) of the Act sets out the powers and responsibilities of the Environment Court when it hears an objection. That subsection provides:
(7) The Environment Court shall—
(a) ascertain the objectives of the Minister or local authority, as the case may require:
(b) enquire into the adequacy of the consideration given to alternative sites, routes, or other methods of achieving those objectives:
(c) in its discretion, send the matter back to the Minister or local authority for further consideration in the light of any directions given by the court:
(d) decide whether, in its opinion, it would be fair, sound, and reasonably necessary for achieving the objectives of the Minister or local authority, as the case may require, for the land of the objector to be taken:
(e) prepare a written report on the objection and on the court's findings:
(f) submit its report and findings to the Minister or local authority, as the case may require.
…
[27] In Waitakere City Council v Brunel, Baragwanath J provided assistance in understanding the meaning of the terms “fair”, “sound” and “reasonably necessary” in s 24(7)(d) of the Act.12 Baragwanath J mentioned that the term “fair” may be limited to a “sense of equitable” or “free from irregularities”.13 The term “sound”
was said to connote “solid and substantial”.14 Baragwanath J also said that the
concept “reasonably necessary” may be engaged even if an alternative proposal is
12 Waitakere City Council v Brunel, above n 11, at [27].
13 At [48].
14 At [49].
available. Baragwanath J noted that the three criteria in s 24(7)(d) of the Act overlap.15 All three criteria must be satisfied.
[28] Section 26 of the Act sets out the procedure for the taking of the land in question by proclamation. Where the Environment Court upholds the taking of land, the Minister or local authority may proceed with the taking. The Minister or local authority submits a survey plan to the Governor-General, together with a statement that no private injury will be done for which compensation is not provided. The Governor-General may then declare the land taken for a public work by proclamation, which must be gazetted and publicly notified. When the proclamation takes effect it operates to absolutely vest the property in fee simple in the Crown or local authority as appropriate, freed from all mortgages and other interests. If a proclamation is subsequently found to be void for a procedural or substantive reason,
in the absence of fraud, it may still confer an indefeasible title on the recipient.16
[29] Under s 28 of the Act, the power to acquire or take land for a public work includes the power to take and hold the land subject to, amongst other devices, a particular estate, interest or easement.
[30] Section 55 of the Act sets out the process for amending documents such as notices of intention to take land. That section provides:
55 Amending or revoking documents
If any Proclamation, Order in Council, notice, declaration, or other document executed under this Act is found to contain any error in form or substance, or if any error in form or substance exists in or in relation to its making or gazetting, the Governor-General, Governor-General in Council, Minister, or other authorised person, as the case may require, may in a subsequent document of the same type amend or revoke the first-mentioned document to correct the error, and the subsequent document shall be deemed to have taken effect on the same date that the first-mentioned document took effect.
[31] Decisions of the Environment Court may only be appealed to the High Court when the appeal involves a question of law.17
15 At [48].
16 Boyd v Mayor, Etc, of Wellington [1924] NZLR 1174 (CA); Chan v Lower Hutt City
Corporation [1976] 2 NZLR 75 (SC).
17 Public Works Act 1981, s 24(14); Resource Management Act 1991, s 299.
First ground of appeal
[32] The first ground of appeal relates only to the four leasehold interests which the respondent intends to acquire.
[33] The appellants contend that once the respondent acknowledged the leasehold interest he wished to acquire would be for a maximum term of two years, the Environment Court was required to determine that the right of the renewal specified in the four notices in question was neither fair nor reasonably necessary.
[34] The appellants then say that as the right of renewal provisions in the notices concerning the leasehold land were neither fair nor reasonably necessary, the Environment Court was required to send the matter back to the respondent for further consideration,18 or report that the taking should not proceed.19
[35] Ms Wilson, who appeared for the appellants, submitted that the first ground of appeal should be allowed because the Environment Court’s conclusion was so unreasonable that no Court acquainted with the issues could have reached the conclusions that are the subject of the first ground of appeal.20
[36] The reasons why the first ground of appeal must be dismissed can be reduced to five points. Any one of these points is sufficient to dismiss the first ground of appeal.
[37] First, the Environment Court fulfilled the roles it was required to undertake under s 24(7) of the Act. Specifically, the Environment Court:
(1) ascertained the objectives of the Minister;21
(2) inquired into the adequacy of the consideration given to the
alternative methods of addressing the respondent’s objections;22 and
18 Public Works Act 1981, s 24(7)(c).
19 Waitakere City Coucil v Brunel, above n 11, at [31].
20 Centrepoint Community Growth Trust v Takapuna City Council [1985] 1 NZLR 702 (CA) at
706.
21 Olliver Trustee Ltd v Minister for Land Information, above n 1, at [18]-[23].
22 At [24]-[89].
(3)decided that, in its opinion, it would be fair, sound and reasonably necessary for achieving the objectives of the respondent for the land in question to be taken.
[38] Second, the approach taken by the Environment Court reflected the parties’ understanding before the Environment Court hearing commenced. The parties knew the respondent required the leasehold interests for a maximum term of two years.
[39] Third, the approach taken by the Environment Court reflected the position adhered to by the parties during the hearing in which there was no doubt the respondent was seeking a leasehold interest for a maximum period of two years without a right of renewal.
[40] Fourth, the appellants have not suffered any genuine prejudice by the approach taken by the Environment Court. What the appellants have lost is the opportunity to force the respondent to recommence the procedure to compulsorily acquire the leasehold land in question. The appellants’ approach appears to be a tactical manoeuvre designed to force the respondent back to the negotiating table.
[41] Fifth, in the case of compulsory acquisition of the leasehold interest in land, the requirements of s 24(7)(d) are met if the Environment Court concludes that, in its opinion, it would be fair, sound and reasonably necessary for the respondent to acquire a shorter term lease than specified in the notices, in order to achieve his objectives. This conclusion is based on the maximum omne majus continet in se minus (the greater includes the less). Ms Wilson suggested this maxim applied only to cases involving repayments of debt and was not relevant. However, as the learned authors of Bennion on Statutory Interpretation explain, the maxim “… is a principle
the law recognises in many contexts”.23 I can see no reason in principle why the
maxim should not also apply to the circumstances of this case. I note Baragwanath J had a similar view in Waitakere City Council v Brunel.24 Accordingly, I can see nothing wrong with the Environment Court’s decision to delete the right of renewal
from the terms of the lease and to report this to the respondent.
23 Oliver Jones (ed) Bennion on Statutory Interpretation (6th ed, LexisNexis, London, 2013) at 513.
24 Waitakere City Council v Brunel, above n 11, at [25].
[42] The appellants’ first ground of appeal invites a formulaic approach to prevail over substance. In this respect the appellants’ arguments in relation to the first ground of appeal resemble those employed by practitioners in the Court of Common Pleas and is not consistent with modern approaches in which judges strive to achieve outcomes that are fair and reasonable. The appellants’ first ground of appeal is devoid of merit and must be dismissed.
Second ground of appeal
[43] The second ground of appeal relates to both the leasehold and easement interests the respondent intends to acquire.
[44] The Environment Court dismissed the appellants’ objections in which they alleged the leasehold and easement notices were unduly restrictive and unreasonably limited to the appellants’ access to their land. In dismissing the appellants’ objections, the Environment Court said that issues relating to the appellants’ access to their land were matters that were relevant to compensation under Part 5 of the
Act.25
[45] The second ground of appeal alleges the Environment Court failed to adequately take into account that the terms of the easements and leases unnecessarily constrain the appellants’ ability to deal with their land throughout the duration of the work.
[46] Part of the appellants’ second ground of appeal is premised on the submission that the parties had reached agreement before the hearing that would enable the appellants to have unrestricted access to their land throughout the duration of the works.
[47] However, while the Agency offered to facilitate the appellants’ access to their land, no agreement was actually reached. Ms Wilson acknowledged this important point during the course of her oral submissions.
[48] In its report, the Environment Court referred to evidence that the Agency would install storm water pipes at an early stage of construction to minimise disruption to the appellant. The Environment Court did not, however, refer to the proposals made by the Agency to minimise the effects of the works on the appellants’ ability to access their land.
[49] The fact the Environment Court did not refer to some of the proposals made by the Agency cannot be construed as meaning the Environment Court failed to determine if the leases and easements were fair, sound and reasonably necessary to achieve the respondent’s objectives. There is a significant difference between offers made during the course of negotiations and what might ultimately be determined to fair, sound and reasonably necessary under s 24(7)(d) of the Act. It is not unusual for parties to make offers to achieve settlement which, if accepted, produce a result for the offeror, which is less advantageous than if they proceeded to obtain judgment. It was for the Environment Court to determine if the intended takings by the respondent were fair, sound and reasonably necessary. The appellants’ second ground of appeal is misconceived because it involves the conflation of offers and acknowledgements with the criterion in s 24(7)(d) of the Act.
[50] Ultimately, the Environment Court concluded the terms of the leases and easements were fair, sound and reasonably necessary for achieving the objectives of the respondent in relation to the land in question.26
[51] The appellants have not demonstrated an error of law by the Environment Court in relation to the second ground of appeal. The second ground of appeal must therefore be dismissed.
Third ground of appeal
[52] The appellants submit the Environment Court erred by taking into account the contents of the memorandum from the respondent dated 5 February 2015. The appellants say the respondents should have followed the procedure to amend notices in s 55 of the Act, rather than rely on the memorandum of 5 February 2015.
[53] There are four reasons why the third ground of appeal must be dismissed.
[54] First, s 276 of the Resource Management Act 1991 confers a wide discretion on the Environment Court to regulate what evidence it receives.
[55] Second, the appellants were given every reasonable opportunity to respond to the 5 February 2015 memorandum from the respondent.
[56] Third, it is questionable whether the Environment Court actually relied on the
5 February memorandum. The memorandum is not referred to in the Environment
Court’s report.
[57] Fourth, the respondent did not purport to amend the notices when it filed the
5 February memorandum.
Conclusion
[58] All three grounds of appeal are dismissed.
[59] The respondent is entitled to costs on a scale 2B basis.
Solicitors:
Minter Ellison Rudd Watts, Auckland for Plaintiff
Crown Law Office, Wellington for Defendant
D B Collins J
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