Property Rights in New Zealand Incorporated v Manawatu-Wanganui Regional Council

[2012] NZHC 1272

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

CIV 2012-454-49 [2012] NZHC 1272

UNDER  the Resource Management Act 1991

BETWEEN  PROPERTY RIGHTS IN NEW ZEALAND INCORPORATED Appellant

ANDMANAWATU-WANGANUI REGIONAL COUNCIL

Respondent

Hearing:         24 April 2012

Counsel:         M W Plowman with P J Chumun for Appellant

J W Maassen for Respondent
P R Gardner for Federated Farmers of New Zealand

Judgment:      8 June 2012

JUDGMENT OF THE HON JUSTICE KÓS

Introduction

[1]      Do regional councils have statutory authority to make rules to control land use for the purpose of maintaining indigenous biological diversity?

[2]      The  Manawatu-Wanganui  Regional  Council  is  promulgating  a  combined regional policy statement and regional plan.   The statement identifies the regional council as the local authority with responsibility for developing rules controlling the use of land for the purpose of maintaining indigenous biodiversity.  The plan sets out those rules.  Everyone accepts that someone may make rules controlling the use of land for the purpose of maintaining indigenous biodiversity.   The question here is

whom may do so.

PROPERTY RIGHTS IN NEW ZEALAND INCORPORATED V MANAWATU-WANGANUI REGIONAL COUNCIL HC PMN CIV 2012-454-49 [8 June 2012]

[3]      In the Environment Court the appellant, Property Rights In New Zealand Incorporated (PRINZ), and Federated Farmers of New Zealand contended that the regional  council  had  no  such  power.     Rather  the  power  vested  in  territorial authorities (district and city councils).  The respondent Council contended that the power  vested  in  it  to  determine  whether  such  rules  were  made  at  regional  or territorial level.  The territorial authorities did not participate in this argument.  They had been consulted on the proposed plan.  Some made submissions.  None opposed

or appealed the indigenous biodiversity provisions.1

[4]      The Environment Court, in a preliminary decision dated 21 December 2011, sided with the Council.   It held that s 30(1)(ga) of the Resource Management Act

1991  (the  Act)  required  regional  councils  to  establish  objectives,  policies  and methods (including rules) for maintaining indigenous biodiversity.

[5]      PRINZ appeals that decision to the High Court.  On this occasion it is not supported by Federated Farmers.

Background

Statutory scheme

[6]      Section 30(1) of the Act provides, in part:

30       Functions of regional councils under this Act

(1)      Every regional council shall have the following functions for the purpose of giving effect to this Act in its region:

(a)       the establishment, implementation, and review of objectives, policies, and methods to achieve integrated management of the natural and physical resources of the region:

(b)       the preparation of objectives and policies in relation to any actual or potential effects of the use, development, or protection of land which are of regional significance:

(c)      the control of the use of land for the purpose of—

(i)       soil conservation:

(ii)      the maintenance and enhancement of the quality of water in water bodies and coastal water:

(iii)      the maintenance of the quantity of water in water bodies and coastal water:

(iiia)     the maintenance and enhancement of ecosystems in water bodies and coastal water:

(iv)     the avoidance or mitigation of natural hazards:

(v)       the prevention or mitigation of any adverse effects of the storage, use, disposal, or transportation of hazardous substances:

...

(ga)      the   establishment,   implementation,   and   review   of   objectives, policies,   and   methods   for   maintaining   indigenous   biological diversity:

...

Paragraph (ga) was added by the Resource Management Amendment Act 2003.  The background to the amendment was as follows.

[7]      In  February  2000  the  government  issued  the  New  Zealand  Biodiversity Strategy.  It was issued in part-fulfilment of New Zealand’s international obligations under the 1992 Rio Convention on Biological Diversity.    The Strategy document had the goal of establishing a framework to arrest the decline in indigenous biodiversity that had followed settlement and subsequent human exploitation of the country’s natural resources.  The Strategy records that New Zealand, one of the last places to be settled by humanity, has gone on to achieve one of the worst records of indigenous biodiversity loss on the planet.   There was the loss of our larger bird species following initial human habitation.  By the start of the seventeenth century about a third of the country’s original forests had been replaced by grasslands. From the mid-nineteenth century expanding European settlement “started a new wave of forest  destruction”.    A further  third  or  so  of  our  original  forestation  has  been converted to farmlands.   Extensive modification of wetlands, dunelands, river and

lake systems, and coastal areas has also occurred.2

[8]      The same month a ministerial advisory committee proposed that regional councils take a lead role in managing biodiversity affected by private land management.3    One consideration influencing that view was that regional council administrative boundaries, being catchment-based, more closely aligned with ecological boundaries than did territorial boundaries.   Another was that regional councils’ existing  biophysical  functions  generally  were  more  closely  related  to biodiversity management than the broader functions of territorial authorities, so that regional council staff held expertise in many areas of direct relevant to biodiversity.

[9]      In its final report, in August 2000, the committee recommended that regional councils take the – not just a - primary governance role in indigenous biodiversity:4

On the question of sub-national governance, we have firmed in our preliminary views that regional councils should assume the primary governance role for biodiversity.

In  our  preliminary  report  we  identified  a  number  of  reasons  for  our preference for regional council leadership.   Further policy work supported our reasoning, as did the majority of submissions.   Some urged that the contribution  of  territorial  authorities  should  not  be  under-estimated  (or under-valued).   We agree, and our proposal for regional leadership should not be construed as being critical of territorial authorities.  We do, however, find the case for a regional integrated approach compelling.

[10]     The  committee  acknowledged  that  giving  both  regional  councils  and territorial authorities biodiversity responsibilities would create an overlap in functions.  It thought that an “unavoidable necessity”, but not unworkable given that similar overlap existed for hazardous substances and natural hazards.5

[11]     The May 2001  report  of the  Local  Government  and  Environment  Select

Committee recommended that regional councils’ functions be expanded by allowing

“regional   councils   to   contribute   to   biodiversity   management   through   the

3      Bio-what? Preliminary Report of the Ministerial Advisory Committee (Ministry for the

Environment, Wellington, 2000) at 35.

4      Final Report of the Ministerial of Advisory Committee on Biodiversity and Private Land

establishment of methods as well as policies and objectives”.6    As to overlap, the select committee said:7

Issues of overlap between the biodiversity management functions of regional councils and territorial authorities should be resolved through the regional policy statement process, in the same way that overlap issues are resolved for the management of natural hazards and hazardous substances.   An amendment to proposed new section 62 will require that the regional policy statement state which local authority has responsibility for dealing with the maintenance of indigenous biological diversity.

[12]     One result of this policy analysis was the addition of s 30(1)(ga).   Others were amendments to ss 62 and 65.  I will set s 62 out in full, as it is central to the disposition of this appeal:

62       Contents of regional policy statements

(1)       A regional policy statement must state—

(a)      the significant resource management issues for the region;

and

(b)      the resource management issues of significance to iwi authorities in the region; and

(c)      the objectives sought to be achieved by the statement; and

(d)      the  policies  for  those  issues  and  objectives  and  an explanation of those policies; and

(e)      the methods (excluding rules) used, or to be used, to implement the policies; and

(f)      the principal reasons for adopting the objectives, policies, and methods of implementation set out in the statement; and

(g)      the environmental results anticipated from implementation of those policies and methods; and

(h)      the processes to be used to deal with issues that cross local authority boundaries, and issues between territorial authorities or between regions; and

(i)       the local authority responsible in the whole or any part of the region for specifying the objectives, policies, and methods for the control of the use of land—

(i)     to avoid or mitigate natural hazards or any group of

hazards; and

6      Resource  Management  Bill  1999  (Local  Government  and  Environment  Select  Committee

Report) at 24.  That Bill did not progress.  The Resource Management Amendment Bill (No 2)
2003, based on part of the 1999 Bill was then introduced in March 2003, and was assented to in

(ii)   to prevent or mitigate the adverse effects of the storage,  use,  disposal,  or  transportation  of hazardous substances; and

(iii)   to maintain indigenous biological diversity; and

(j)      the procedures used to monitor the efficiency and effectiveness of the policies or methods contained in the statement; and

(k)      any  other  information  required  for  the  purpose  of  the regional council's functions, powers, and duties under this Act.

(2)      If no responsibilities are specified in the regional policy statement for functions described in subsection (1)(i)(i) or (ii), the regional council   retains   primary   responsibility   for   the   function   in subsection  (1)(i)(i)  and  the  territorial  authorities  of  the  region retain  primary  responsibility  for  the  function  in  subsection (1)(i)(ii).

Notably there is no default provision in s 62(2) to determine who has primary responsibility  for  the  function  described  at  s  62(1)(i)(iii),  in  the  event  that  the regional policy statement fails to make an express allocation.

[13]     But the key point to be taken from s 62(1), after its 2003 amendment, is that it is the regional policy statement – a regional council instrument – that is to identify the  “local  authority  responsible  ...  for  specifying  the  objectives,  policies  and methods for the control of the use of land ... to maintain indigenous biological diversity”.   Both regional councils and territorial authorities are “local authorities” for the purposes of the Act.

[14]     Section 65 was also amended consequently in 2003.  Section 65(1) reads:

65     Preparation and change of other regional plans

(1)     A regional council may prepare a regional plan for the whole or part of its region for any function specified in section 30(1)(c), (ca), (e), (f), (fa), (fb), (g), or (ga).

That  provision  empowers  a  regional  council  to  prepare  a  regional  plan  for  the function  specified  in  s  30(1)(ga).    There  is  no  mention  there  of  the  functions described in s 30(1)(a) and (b).  The same exception is carried through in s 68(1)(a). As the Environment Court said in its decision, these exceptions make perfect sense. A regional council does not need to make rules about establishing, implementing and

reviewing, or preparing, objectives, policies and methods - the functions described in s 30(1)(a) and (b).

[15]     Finally, I note two further provisions.   First, s 31 of the Act defines the functions of territorial authorities.  It reads, in part:

31       Functions of territorial authorities under this Act

(1)      Every territorial authority shall have the following functions for the purpose of giving effect to this Act in its district:

(a)      the  establishment,  implementation,  and  review  of objectives, policies, and methods to achieve integrated management of the effects of the use, development, or protection of land and associated natural and physical resources of the district:

(b)       the control of any actual or potential effects of the use, development, or protection of land, including for the purpose of—

(i)     the avoidance or mitigation of natural hazards; and

(ii)     the prevention or mitigation of any adverse effects of the storage, use, disposal, or transportation of hazardous substances; and

(iia)   the prevention or mitigation of any adverse effects of the development, subdivision, or use of contaminated land:

(iii)    the maintenance of indigenous biological diversity:

...

It  may be noted that  paragraph  (b)(iii)  was  added  in  its  present  form  in  2003. Secondly, there is s 75(4).  It provides that a district plan cannot be inconsistent with a regional plan.

Proposed One Plan

[16]     As I mentioned in the Introduction, the Council has promulgated a combined regional policy statement and regional plan.  There is a power to do so in s 80(2) of the Act.  The proposed instrument is called the “One Plan”.  As it is still a proposed plan (and statement) it has become known as the “POP”.  The POP was notified in

May 2007.   Its function is to replace the current regional policy statement and six operative  regional  plans.    It  received  over  400  submissions.    Seven  affected territorial authorities made submissions.  Following a hearing at Council level, the Council made decisions on the POP.  Appeals against those decisions are now being heard by the Environment Court.

[17]     One of the submissions came from the appellant, PRINZ.   Another from Federated Farmers of New Zealand (Federated Farmers).  Their submissions, as far as relevant to this appeal, concerned policy 7-1 and rule 12-6 of the POP.

[18]     Policy 7-1 (in the decisions version) reads:

Policy  7-1:    Responsibilities  for  maintaining  indigenous  biological diversity

In accordance with s 62(1)(i) RMA, local authority responsibilities for controlling land use activities for the purpose of managing indigenous biological diversity in the Region are apportioned as follows:

(a)       The Regional Council must be responsible for:

(i)        developing objectives, policies and methods for the purpose of establishing a Region-wide approach for maintaining indigenous   biological   diversity,   including   enhancement where appropriate

(ii)       Developing rules controlling the use of land to protect areas of significant indigenous vegetation and significant habitats of indigenous fauna and to maintain indigenous biological diversity, including enhancement where appropriate.

(b)       Territorial Authorities must be responsible for:

(ii)       retaining schedules  of  notable trees  and  amenity trees  in their district plans or such other measures as they see fit for the purpose of recognising amenity, intrinsic and cultural values associate with indigenous biological diversity, but not for the purpose of protecting significant indigenous vegetation and significant habitats of indigenous fauna as described in (a)(ii) above.

(c)       Both  the  Regional  Council  and  Territorial  Authorities  must  be responsible for:

(i)        recognising and providing for matters described in s 6(c) RMA and having particular regard to matters identified in s

7(d) RMA when exercising functions and powers under the

RMA, outside the specific responsibilities allocated above,

including  when  making  decisions  on  resource  consent applications.

So  it  would  seem  that  the  policy contemplates  the  Council  having  overarching responsibility for developing objectives, policies and methods (which include rules) concerning indigenous biodiversity at a region-wide level, and making rules concerning the use of land to maintain indigenous biodiversity.   The territorial authorities have a subordinate role.

[19]     Rule  12-6  (again  in  the  decisions  version)  classifies  various  activities (including vegetation clearance, forestry and diverting water) as discretionary activities where they take place within a rare, threatened, or at risk habitat.   That decision itself is controversial.  Some appeals contend that the classification should be non-complying.  That status would impose a higher threshold for consent: non- complying activities must not be consented if their effects are more than minor or they will otherwise be contrary to the relevant objectives and policies of the plan.  If they  pass  those  thresholds,  they  are  considered  then  on  the  same  basis  as  a

discretionary activity.8

[20]     PRINZ and Federated Farmers took a different view.  They did not think the Council should be making land use rules at all in the area of indigenous biodiversity. They took the view that the Council’s powers to control land use were confined to the purposes stated in s 30(1)(c) – soil conservation, water quality and the like.

[21]     The  Environment  Court  hearing  the  appeals  on  the  POP  resolved  to determine this question as a preliminary issue.

Environment Court decision

[22]     The Environment Court held that the functions of the Council regarding land use controls were not confined to those set out in s 30(1)(c).  It said:9

8      Resource Management Act 1991, s 104D(1).

9      Federated Farmers of New Zealand v Manawatu-Wanganui Regional Council [2011] NZ EnvC

403 at [6].

There is nothing magic about (c) – it is not a code of purposes by which a regional council is confined in its objective, policy or rule making powers.

Section 30(1)(ga) made it a mandatory function of every regional council to establish objectives, policies and methods for maintaining indigenous biodiversity.  That did not exclude rules affecting or controlling the use of land. The Court said:10

If it is reasonably necessary to control the use of land in some way to fulfil the requirement, then there is nothing in s 30 to prohibit that.

The Court concluded:11

The short point is that s 30(1)(ga) means what it says.  Regional Councils are required to establish, implement and review objectives, policies and methods (including  rules)  for  maintaining  indigenous  biological  diversity.    The content of those objectives, policies and rules may be the subject of debate, but the power of the Council to establish them, subject to process, is beyond doubt.

Submissions

PRINZ

[23]     A member of PRINZ, Mr Mike Plowman, argued the case for PRINZ.  There was  some  irony  in  his  doing  so.    He  is  an  elected  regional  councillor  of  the respondent Council.  Mr Plowman’s argument, in essence, was that notwithstanding s 30(1)(ga), regional councils do not have rule-making power to control land use to protect areas of significant indigenous vegetation and fauna.  Section 31(1)(b)(iii) is clear in giving territorial authorities the function of controlling land use for the purpose of maintaining indigenous biodiversity.  Mr Plowman argued that a regional council does not have the power to allocate to itself functions that are allocated to territorial authorities by the Act – here s 31(1)(b)(iii).  Those functions must first be transferred from the territorial authority to the regional council under s 33.

[24]     Secondly,  s  68(1)  precludes  the  regional  council  including  rules  for  the purpose of  carrying out  s 30(1)(a) and  (b) functions.   That,  says  Mr  Plowman,

impliedly also includes the s 30(1)(ga) function which is effectively assimilated

10 At [7].

11 At [14].

within s 30(1)(a) and (b).   Some support for that submission is to be found in

Brookers Resource Management where it says:12

Section 68(1) limits the powers of regional councils to make rules in relation to functions conferred by s 30(1)(a), 30(1)(b)  and 30(1)(ga).   Rules are clearly envisaged by paragraphs (c) to (g), which relate to control. Accordingly, where Part 2 matters are relevant to the functions covered by paragraphs (c) to (g) those matters may be dealt with by way of rules as well as by objectives and policy.  [Emphasis added].

[25]     Thirdly, Mr Plowman conceded (as did Mr Gardner for Federated Farmers) that “methods” in s 30(1)(ga) includes rules.  Later Mr Plowman sought to withdraw that concession.   Ultimately he sought to maintain a “methods” within s 30(1)(ga) contemplated only non-regulatory responses.

Council

[26]     On behalf of the Council, Mr John Maassen argued that s 30(1)(ga), together with other key provisions in Part 4 of the Act, gives regional councils statutory authority to control land use for the purpose of maintaining indigenous biodiversity. That, he said, was the direct consequence of the 2003 Amendment Act.  Particular provisions Mr Maassen relied on were ss 30(1)(ga), 62(1)(i)(iii) and 68(1).   He submitted also that the planning context supported the Council’s interpretation.  The word “methods” is used in the Act, and in s 30(1)(ga) in particular, can include both rules and non-regulatory methods.

[27]     Mr Maassen referred also to the legislative history discussed earlier, and to the social and local authority context.  He noted that the evidence suggested that the region had within a five year period experienced a loss of 1,322 hectares of indigenous vegetation, particularly in lowland areas.   As the ministerial advisory

committee had noted in 2001,13 regional boundary and catchment-related scale were

better suited to the management of indigenous biodiversity through the management of catchments and land forms than distributed territorial authorities.   In addition, regional councils possess the necessary scientific knowledge, experience and data to

achieve integrated management of indigenous biodiversity.   He noted in this case

12     Brookers Resource Management (online looseleaf ed, Brookers) at [A30.04(2)].

13 See at [8] above.

there was apparent support from the seven territorial authorities affected for the jurisdictional approach taken in the POP.

Federated Farmers

[28]     Federated Farmers of New Zealand was a party to the original appeal.  It is not an appellant in the present proceeding, as it does not support PRINZ’s appeal. However Mr Richard Gardner made helpful submissions indicating the position of Federated Farmers.   In essence Federated Farmers would have preferred the jurisdiction issue not be dealt on a preliminary question.  However the reality is that the Environment Court has set that preliminary question, resolved it and this is an appeal from it.   On the substance of the appeal Mr Gardner did not support the argument by PRINZ that a regional council may not include rules in its regional plan related to indigenous biodiversity.  He agreed with the finding of the Environment Court that “methods” in s 30(1)(ga) can include rules.

Analysis

[29]     Five points need to be made.

[30]     First, s 68(1) plainly empowers the Council to make rules for the purposes of carrying out any functions conferred on it under the Act, save those in s 30(1)(a) and (b).   Parliament did not see fit to also except s 30(1)(ga).   By virtue of the latter provision, one of its functions is the establishment, implementation, and review of objectives, policies, and methods for maintaining indigenous biological diversity.  So plainly the Council may make rules in its regional plan – here the POP – for that purpose.  On the face of the Act there is no basis to exclude it doing so in relation to the use of private land.   There is no apparent or valid basis to assimilate the s

30(1)(ga) function within s 30(1)(a) and (b), as PRINZ submits.   The passage in Brookers Resource Management cited earlier14 and which suggests otherwise is incorrect.  The function in s 30(1)(ga) also embraces controls on the use of land – as

the third point made below confirms.

14 At [24].

[31]     Secondly, s 30(1)(ga) creates a mandatory obligation on the part of regional councils to make objectives, policies and methods for the maintenance of indigenous biological diversity.  Such methods may include rules.  The Council contends that. Federated Farmers concedes that.   PRINZ did likewise until the implications of its concession became plain.   At the end of the day, s  68(1) confirms that.   More generally, a “method” is what it says: a way of doing something.  In its RMA context it may include rules.  Sections 31(2), 32(4)(a), 67(2)(b) and 75(2)(b), for instance, all make that abundantly clear.  Methods are not confined to rules (there may be non- regulatory methods too), but necessarily they may include rules.

[32]     Thirdly, it is true that s 30(1)(c) provides that it is a function of a regional council to control the use of land for certain purposes.   The maintenance of indigenous biodiversity is not expressly named within that provision.   I do not however accept that it is consistent with the purpose of the 2003 amendment to read down s 30(1)(ga) so that it includes every relevant function apart from controls over the use of land.  Context suggests that was not what Parliament intended.  Rather, s

30(1)(ga) was located outside of s 30(1)(c) simply because that function is broader than the control of the use of land - although it may include such controls.

[33]     Fourthly, it is also true that s 31(1)(b)(iii) gives territorial authorities a similar function, specifically in relation to controls over the use of land.  Such controls are the particular concern of territorial authorities, just as air, water and the coastal marine area (the latter on a shared basis) are the particular concern of regional councils.   But the existence of a functional overlap was expressly anticipated by the legislature,   as   the   select   committee   report   discussed   earlier   demonstrates.15

Parliament  resolved  the  potential  conflict  in  two  ways.     First,  by  the  2003

amendment made to s 62, concerning the mandatory requirements of regional policy statements.  Such a statement must be prepared by the relevant regional council.16

And by reason of s 62(1)(i) it is specifically the regional council, through its regional policy statement, that is to decide which local authority (i.e. the regional council or

the relevant territorial authority)17 is to be responsible for specifying the objectives,

15 At [10].

16     Section 60(1).

17     See s 62(2).

policies, and methods (i.e. including rules) for the control of the use of land to avoid or mitigate natural hazards and hazardous substances – and to maintain indigenous biodiversity.  Policy 7-1 is exactly the exercise of allocative responsibility intended by that provision.  The regional policy statement may determine that a territorial has either some or no rule-making role in relation to controls of land use to maintain indigenous biodiversity.   Secondly, s 75(4) resolves any residual conflict between regional and territorial plans.  It provides that a district plan cannot be inconsistent with a regional plan

[34]     Finally, as the responsibility is given to regional councils to allocate the relative rule-making roles of regional and territorial authorities under s 62(1)(i), no issue of transfer of functions arises under s 33.

Conclusion

[35]     It follows that I agree with the conclusion reached at first instance by the

Environment Court.

Disposition

[36]     The appeal is dismissed.

[37]     The Council is entitled to costs.  If they cannot be agreed, memoranda may be submitted.

Stephen Kós J

Solicitor:

Cooper Rapley, Palmerston North for Respondent

And to:

Donald Coles, RD2, SH 22, Huntly, Appellant

Federated Farmers of New Zealand, 159 Khyber Pass, Auckland