Tasti Products Ltd v Auckland Council
[2016] NZHC 1673
•21 July 2016
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2016-404-000238 [2016] NZHC 1673
BETWEEN TASTI PRODUCTS LIMITED
First Plaintiff
NORTH WESTERN PROPERTY LIMITED
Second Plaintiff
AND
AUCKLAND COUNCIL First Defendant
MIDPOINT INVESTMENTS LIMITED Second Defendant
KEITH WALKER BUILDINGS LIMITED
Third Defendant
Hearing: 30 June and 6 July 2016 Appearances:
S J Ryan and R H Ashton for Plaintiffs
H M Rice and S A Beattie for First Defendant
A W Braggins and R Steller for Second Defendant
No appearance for Third DefendantJudgment:
21 July 2016
JUDGMENT OF WYLIE J
This judgment was delivered by Justice Wylie
On 21 July 2016 at 4.30pm Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar
Date:…………………………
Solicitors/counsel:
S Ryan, Jackson Russell, Auckland
Rice & Co, Auckland
Berry Simons, Auckland
TASTI PRODUCTS LTD & ANOR v AUCKLAND COUNCIL & ORS [2016] NZHC 1673 [21 July 2016]
Introduction
[1] The plaintiffs – Tasti Products Ltd (“Tasti”) and North Western Property Ltd (“North Western”) – have brought an application for review challenging a number of planning decisions made under the Resource Management Act 1991 (“the Act”) by the first defendant, Auckland Council.
[2] The impugned decisions are as follows:
(a) a decision not to notify Tasti, by way of limited notification under s 95B of the Act (the “notification decision”), of a resource consent application for a live/work development made by the second defendant, Midpoint Investments Ltd (“Midpoint”);
(b) a decision to grant consent, subject to conditions, to Midpoint for its
live/work development (the “consent decision”); and
(c) a decision not to notify an application for a variation to the consent conditions, and the resulting decision to grant that variation (the “variation decisions”).
[3] The challenges arise because changes are proposed to the current planning regime, contained in the Council’s operative district plan, by the Proposed Auckland Unitary Plan (“the PAUP”).
[4] Following local government reorganisation which amalgamated a number of smaller local authorities into Auckland Council, the new Council was required, by the Local Government (Auckland Transitional Provisions) Act 2010, to prepare a new plan for greater Auckland that met the requirements of a regional policy
statement, a regional plan (including a regional coastal plan) and a district plan.1 As
a result, the PAUP was notified on 30 September 2013. An Independent Hearings
Panel has been hearing submissions on it since 2014. The hearings concluded in early May 2016 and the Panel is due to lodge its recommendations with the Council
1 Local Government (Auckland Transitional Provisions) Act 2010, Part 4.
on 22 July 2016. The Council is expected to make its decisions on those recommendations on or about 19 August 2016.
[5] Tasti and North Western allege that the Council, in its notification and consent decisions, did not recognise the new objectives and policies notified in and, in their submission, likely to be introduced by, the PAUP. They say that the new objectives and policies signal a shift in planning direction and that, if introduced, they will affect both the land owned by North Western and occupied by Tasti, and the land the subject of Midpoint’s resource consent application. They say that the failure to recognise the likely new objectives and policies was a fundamental error which invalidates all of the challenged decisions.
[6] It was common ground that the variation decisions are an integral part of the consent decision. They impose additional conditions on that decision, intended by Midpoint to address what are known as “reverse sensitivity” concerns which have been raised by North Western and Tasti. All parties accepted that the validity of the variation decisions stands or falls on the outcome of the challenges to the notification and consent decisions. Accordingly, this judgment focuses on those decisions, and in particular on the notification decision.
Matters in issue
[7] Mr Ryan, for North Western and Tasti, suggested that the following matters were in issue:
(a) The notification decision:
(i)Did the Council have adequate information before it so that it could properly determine whether North Western and/or Tasti were affected persons under ss 95B and 95E of the Act?
(ii)Were the adverse effects of Midpoint’s proposed activity on North Western and/or Tasti minor or more than minor such that they were affected persons for the purposes of ss 95B and 95E of the Act?
(iii)Did the Council err in failing to consider relevant objectives and policies contained in the PAUP, in determining who was an affected person for the purposes of ss 95B and 95E of the Act.
(b) The consent decision:
(i)Did the Council err in its consideration of relevant objectives and policies contained in the PAUP when making the consent decision under ss 104 and 104D of the Act?
(ii)Did the Council err in failing to undertake a weighting exercise between the provisions of the operative plan and the provisions of the PAUP when making the consent decision under s 104 of the Act?
(c) If either or both decisions are flawed, should the Court, in the exercise of its discretion, grant relief to North Western and Tasti?
Factual background
The relevant properties
[8] Tasti and North Western are related companies.
[9] Tasti is a food manufacturer. It carries on business from premises located at
25-41 Totara Road, Te Atatu and on an adjoining site at 753 Te Atatu Road. It employs 250 people full-time and up to 30 people part-time. It operates 24 hours a day, six days a week. Its business is growing and at present it is “capacity restrained”.
[10] The site occupied by Tasti is owned by North Western. North Western has also acquired, at not insignificant cost, adjoining properties at 761-769 Te Atatu Road, 3/753 Te Atatu Road and 60 Wharf Road. These additional properties are
currently leased to third parties, but they provide an available resource so that Tasti can expand its operations over time.
[11] North Western and Tasti have made a considerable investment in land, buildings and plant at their Te Atatu site.
[12] All of the land owned by North Western, including the land occupied by Tasti, is within a block bounded to the north by Totara Road, to the west by Te Atatu Road, to the south by Wharf Road, and to the east by residential housing. North Western owns the majority of the properties in the block. There are other properties, including the property the subject of Midpoint’s application, which are not owned by North Western. Two of the properties in the block, not owned by North Western, one at 48 Wharf Road and the other at 781 Te Atatu Road, have recently been the subject of consents granted by the Council for the development of two storey units with commercial floor space on the ground floor and residential floor space above. The development at 48 Wharf Road has been built. The other, at 781 Te Atatu Road, has yet to be constructed. North Western and Tasti were unaware of the consent granted in respect of that property until it was disclosed in the course of the present application.
[13] Auckland Council is the territorial authority.
[14] Midpoint is a property developer. It retained Mr Craig Magee, of Resource Management Solutions Ltd, to prepare an application for a 24 unit development – described as a “live/work” development – on a 4442 m² site at 741-743 Te Atatu Road (the “development site”).
[15] The development site is on the corner of Te Atatu Road and Wharf Road. It is owned by the third defendant, Keith Walker Buildings Ltd, but that company has taken no steps. The development site, in its north eastern corner, shares a 12m boundary with part of the land owned by North Western and occupied by Tasti. This part of the North Western/Tasti land comprises a narrow 12m wide tongue of land which leads north to the balance of the North Western/Tasti land. A raw materials warehouse currently sits on this narrow tongue of land and the concrete wall of the
warehouse building sits on or immediately adjacent to the 12m common boundary. Tasti’s main manufacturing operation and its distribution activities occur some distance from this boundary. The loading area servicing Tasti’s production lines is accessed from an alley located at the south western side of 753 Te Atatu Road. Tasti has taken steps to try and ensure that it does not have any adverse effects on the amenity of its residential neighbours to the east by placing its finished goods warehouse and administrative buildings adjacent to that boundary.
[16] There are commercial/light industrial properties at 747-751 Te Atatu Road and at 46 Wharf Road which also immediately adjoin the development site – the first to the north and the second to the east. Neither of these properties belong to North Western or Tasti and, insofar as I am aware, the owners/occupiers of these properties have not sought to challenge any of the Council’s decisions. There are residential properties across Wharf Road to the south. Across Te Atatu Road to the west, there is a block of shops, a small neighbourhood park and a number of residential properties. Again, insofar as I am aware, the owners/occupiers of these various properties have taken no steps.
[17] I annex (Annexure A) an aerial photograph showing the location of many of the properties discussed above.
Midpoint’s resource consent application
[18] Following two pre-application meetings between Midpoint’s advisors and Council officers, Midpoint’s application for resource consent was lodged in late August/early September 2015. An Assessment of Effects on the Environment prepared by Resource Management Solutions Ltd, dated 31 August 2015, and an acoustic design report prepared by Golder Associates, dated 28 August 2015, accompanied the application. It was lodged on a non notified basis. It sought consent for a two storey development incorporating commercial, retail and residential uses. It was proposed that the commercial and retail uses would locate on the ground floor of each unit, and that each commercial/retail use would have residential floor space above. There were to be 22 two bedroom units, and two three bedroom units. The application stated that, once constructed, most units would be
“unit titled” as a single unit, with the commercial floor space downstairs and the residential floor space upstairs. It stated that the proposal was designed to provide appropriate units for those who wish to live and work at the same location, although it was noted that Midpoint did not want to preclude the residential and commercial floor space being sub-leased. It was proposed that a café would locate on the corner beneath one of the three bedroom units and that both of the three bedroom units would be unit titled independently. The units were to provide balconies, some of which would overlook adjacent land used for industrial purposes. Extensive internal car parking and landscaped areas on the road boundaries were proposed.
Planning documents
[19] The development site, all of North Western’s land, the adjoining sites at 747-
751 Te Atatu Road and at 46 Wharf Road, and the recently consented properties at
48 Wharf Road and 781 Te Atatu Road, are all located in a zone known as the Working Environment zone in the Council’s Operative District Plan – Waitakere Section 2003. Relevantly, dwellings are permitted in this zone but only where the use of the dwelling is subsidiary to a non residential activity on the same site.
[20] The live/work development proposed by Midpoint was said, in the resource consent application, to be a discretionary activity under the Operative Plan, because:
(a) the residential component was not considered to be subsidiary to the non residential activity proposed;
(b) earthworks will be required; and
(c) certain other aspects of the proposal, namely landscape treatment, parking and signage, require consent as limited discretionary activities.
The proposed development also falls within a flood plain, identified as a natural hazard, under Auckland wide rules introduced by the PAUP. These particular rules
are already in force, and they have legal effect.2 Pursuant to these rules, vulnerable activities in a flood plain, including residential activities, are non-complying activities.
[21] It was common ground that Midpoint’s application for the proposed live/work development property fell to be considered as a non complying activity under s 104 and s 104D of the Act.
[22] The PAUP proposes to rezone the block of land, in which the development site is located, to Light Industry. This new zone is intended to provide for light industrial activities that do not generate objectionable odour, dust or noise emissions. It is anticipated that the zone will include light manufacturing, production, logistics, storage, transport and distribution activities. Relevantly, the notified zone description records as follows:
Due to the industrial nature of the activities, sensitive activities such as residential, office or retail activities that are not related to the predominant use on-site are not appropriate. An exception is made for trade suppliers, motor vehicle sales and garden centres, which may locate in the zone subject to location and traffic considerations.
The notified objectives and policies are as follows:
Objectives
1.Light industrial activities locate and function productively within the zone.
2.The establishment of activities that may diminish the efficiency and functionality of the zone for industrial activities is avoided.
3.Adverse effects on the natural environment and general amenity, both within the zone and on adjacent areas, are managed.
4.Development avoids adverse effects on the amenity of adjacent public open spaces and residential zones.
Policies
1. Enable a range of light industrial activities to locate in the zone.
2. Avoid activities that create reverse sensitivity effects and constrain
[the] establishment and operation of light industrial activities.
2 Resource Management Act 1991, s 86B(3) and (5).
3. Limit retail activities in the zone to:
a. convenience retail that serves the local worker population
b. trade suppliers, service stations, motor vehicle sales and garden centres.
4. Avoid:
a. office activities, except where they are necessary to the primary activity on-site
b. residential activities other than for persons whose duties require them to live on-site.
5.Require development that adjoins public open space or residential zones to maintain the amenity values of those places.
6.Manage development so that it does not adversely affect the sale and efficient operation of the transport network, particularly for freight.
The processing of the application
[23] The application was referred to Ms Kristin Spyve, a senior planner employed by Auckland Council. She visited the site on 15 September 2015. She was accompanied by other Council officers, namely Mr Sunny Kan, an urban design specialist, and Mr Gordon Griffin, a landscape specialist. She walked over the site, and viewed adjoining properties and land uses. She perused the application and the supporting materials. She decided not to seek a review of the acoustic design report prepared by Golder Associates. She sent a letter to Midpoint’s planning consultants under s 92 of the Act, requesting further information. Inter alia, the letter recorded as follows:
Reverse Sensitivity
The application has noted the intention is to have the site unit-titled with the commercial unit and the residential unit upstairs as a single unit to allow for people to live and work within the same location. It also notes the residential units have been acoustically treated to avoid reserve sensitivity effects related to noise. The acoustic treatment of the residential units is supported by Council and it is agreed this can mitigate effects associated with noise. The application does not however consider activities that generate odour and hours of operation associated with activities in the Working Environment. Please demonstrate how the proposal will manage effects associated with these.
A successful Live/Work development has a finely balanced dynamic between the commercial and residential spaces. Certain types of commercial activities would not be compatible with residential accommodation and
should be avoided (odour and noise generating uses). The applicant is invited to consider what activities should be precluded from operating on the site. The following activities should be considered in this:
· Activities involving spray painting
· Panel beating
· Motor and motor vehicle repairs
· Any activity involving fibre-glassing and sheet metal work
· Odour generating activities
Clarification is also sought on how the operation of the residential/commercial use will be achieved on the site. It is noted in the application the residential and commercial units will be held in a single future unit title but the applicant does not want to preclude each unit from being able to be sub-leased separately if required. The occupancy of the ground floor by business use is imperative to ensure the development does not become dominated by residential accommodation, and subsequently diluting the “Work” component of the development in this Working Environment site. Council would like to understand how the relationship between the residential and commercial activity for each unit can be achieved/maintained to achieve the outcome of the Live/Work model the proposal is based on. Will there be a mechanism in place to ensure a percentage/majority of the unit achieves the Live/Work model?
Please note a condition of the consent will be considered by Council to preclude any residential activity occurring in the commercial unit component of the proposal.
(Italics added)
[24] On 8 October 2015, Ms Spyve met with Mr Magee, along with other Council officers, to discuss the s 92 request. A response to the request was sent to the Council on 15 October 2015. Relevantly, it provided as follows:
As discussed, the issue of a unit owner sub-letting the commercial part of their unit out to someone else was specifically addressed as we were asked to do so. It has been mentioned as something that could potentially occur, as the applicant does not want to preclude this possible outcome, but it is not the intention.
The possibility of the unit owner living upstairs and sub-letting the commercial component to someone else (or doing the opposite) adds flexibility but in no way alters the activities or floor areas associated with the activities. As outlined with the traffic report, no additional effects are likely to be generated by this possibility. Additionally, for the same reasons, there would be no discernible difference in terms of intensity (i.e the number of people on a property at any one time). Notwithstanding this, the layout of the proposal internalises any such potential effects, even if there were any, as associated activity would occur back behind the road-frontage units.
The application is being explicitly made on the basis that the lower level of each unit is for commercial use (not residential), and therefore if someone
did wish to alter this then they would need to either seek a variation to the consent, or apply for a fresh consent (if it was considered outside the scope of the consent). If it was determined that the change would result in the development being overly dominated by residential use, then the Council can notify and/or refuse the application accordingly. The suggested condition would therefore seem redundant. Again, there is no intention by the applicant that the areas designated as commercial within each unit be used as residential. The proposal has been designed to meet a market need for small businesses where owners wish to live alongside their workspaces.
It would be preferred that specific activities are not precluded from operating and limits are placed on specific effects instead. However this is unlikely to be able to be effectively [sic] conditions or work in practice, and therefore we propose to exclude the following activities to ensure that odour and noise effects from commercial activities will be more compatible with being in close proximity to resident activity:
· Commercial spray painting
· Panel beating
· Motor and motor vehicle repairs
· Any activity involving fibre-glassing and sheet metal work
Odour generating activities can also be precluded.
We would note that the size of each commercial unit would also preclude a variety of activities from operating which would more likely lead to effects which are not compatible with residential activity.
The proposal specifically provides for commercial activity on the ground floor of each unit, however the Council can certainly further ensure this by imposing a condition of consent.
[25] Ms Spyve prepared a draft planning report. She provided it to her team leader, Mr Matthew Wright, for review and comment on 22 October 2015. Mr Wright is a planner with graduate qualifications and considerable experience in planning. He assessed and had direct involvement in the content of the planning report. His overview was not confined to the final version of the planning report prepared by Ms Spyve.
[26] As team leader, Mr Wright was responsible for making the notification and consent decisions. He held the necessary delegation from the Council under s 34A of the Act to make these decisions. On 23 October 2015, having reviewed the final version of the report, and following some minor amendments, he exercised his delegation and he made both the notification and consent decisions.
The decisions
[27] On 23 October 2015, the Council made and issued both the notification decision and the consent decision. The decisions were made contemporaneously. The Council decided to process Midpoint’s planning application without limited notification under s 95E of the Act. It also decided to grant the application for consent under ss 104 and 104D of the Act.
The notification decision
[28] The notification decision referred to the proposal, the site and the locality. It recorded that the application fell to be considered as a non complying activity. The statutory provisions relevant to public notification were referred to. The decision recorded that it was considered that the proposed activity would have, or would be likely to have, adverse effects on the environment that would be less than minor, and that there were no special circumstances nor reasons to exercise the general discretion conferred by s 95A of the Act. The decision then went on to consider limited notification. Again, the relevant statutory provisions were cited. It was noted that Mr Magee had provided an assessment of adversely affected persons in such detail as corresponded with the scale and significance of the effects the activity might have on persons and on the surrounding environment. Relevantly, it was noted that the assessment of effects concluded that, in relation to the North Western/Tasti site at 753 Te Atatu Road, no person would access the common boundary between the development site and 753 Te Atatu Road, and that any redevelopment of 753 Te Atatu Road was unlikely to result in any changes whereby effects generated by the proposal would be more than negligible. It was concluded that the proposed development would have less than minor effects upon adjacent sites. It was stated that sites located within the Working Environment zoned land, which are adjacent to the application site, were not considered to be adversely affected, as the proposal was not considered to preclude activities occurring on those sites in accordance with the provisions of the district plan. It was accordingly determined that the application should be processed non notified.
[29] The notification decision does not refer either directly, or by implication, to the policies and objectives for the Light Industry zone proposed by the PAUP.
The consent decision
[30] The consent decision referred to the operative plan and to the PAUP. It recorded that the proposal was considered to pass the tests under s 104D for non complying activities, that it was not contrary to relevant objectives and policies, and that it would generate less than minor adverse effects. It was expressly recorded that the proposal was considered to “not be contrary to the policies and objectives of the operative district plan” and that adverse cumulative and reverse sensitivity effects were managed by best practice design. A reference was expressly made to relevant PAUP policies and objectives – in particular in relation to storm water and earth works. The decision went on to record as follows:
The proposal is also consistent with the light industry zone objectives which seek for light industrial activities to be able to locate and function productively within the zone. The design of the proposal would not preclude this and allows for a range of uses. The design of the structures will not create adverse effects upon the amenity of adjacent residential zones as the proposal has been designed to provide a positive interface that is relatable to the residential activities located in the locality.
Various conditions were imposed on the grant of consent. One of the conditions required that residential activity was not to take place on the ground floor of each unit.
The variation decisions
[31] Following the commencement of these proceedings, on 3 May 2016, Mr Magee filed an application under s 127 of the Act seeking to vary the conditions attaching to the consent decision. In particular, he sought to add five additional conditions, dealing, inter alia, with reverse sensitivity and acoustic issues.
[32] On 18 May 2016, Mr Wright, as the delegated decision maker, granted the variation application. He determined that the application for variation did not require limited notification, and that it could be processed non notified. He also granted the application. As a result, the following conditions dealing with reverse sensitivity and acoustic matters were added to the resource consent decision:
Reverse Sensitivity
44.That the consent holder and its successors in title, and any occupiers of the subject site whom are leasing any of the units from the consent holder, shall not make or lodge, be part [sic] to, finance or contribute to the cost of any complaint, application, appeal or other proceeding with [sic] pursuant to the Resource Management Act
1991 or otherwise) designed to limit, prohibit, or restrict any permitted activity or any activity authorised by a resource consent,
or any lawfully established existing uses undertaken on:
(a) Warehouses 1-5 on Lot 3 DP 72261 (as shown on DP
201203)
(b) Lot 1 DP 51394 CT-2C/648 (c) Lot 1 DP 59422 CT-15D/951 (d) Lot 1 DP 58981 CT-12D/137 (e) Lot 2 DP 392325 CT-370184
provided that such activity is carried out in accordance with the terms, standards or conditions applicable to such permitted activity, resource consent or lawfully established uses.
45.Prior to commencing construction of any buildings, the consent holder shall register a covenant on the certificate of title in favour of Auckland Council pursuant to section 108(2)(d) of the Resource Management Act 1991 regarding condition 44 and recording that condition 44 is an ongoing condition of consent and restricts the use of the land to which this consent relates.
Advice Note:
While the covenant in condition 45 is in favour of Auckland Council, condition 44 is an ongoing condition of consent and can be enforced by an [sic] person pursuant to section 316 of the Resource Management Act 1991.
46. …
Acoustic Conditions
47.The units shall be constructed in accordance with the recommendations outline within the Golder Associates (NZ) Limited acoustic report supplied with the application (Acoustic Design Report – 741-743 Te Atatu Road, Auckland, dated 28 August 2015).
48.Following completion of the construction of the units approved by this resource consent, and prior to the occupation of the units, the consent holder shall supply to the Team Leader West Monitoring & Incidents for approval certification from a suitably qualified and experienced acoustic engineer that confirms that the completed units have been built to comply with condition 47 above.
[33] Each of the properties identified in condition 44 are owned by North Western, but the condition does not extend to all of North Western’s land in the block.
The application for review
[34] As I have noted, Tasti/North Western challenge the various decisions made by the Council.
[35] There was no dispute as to the applicable principles. All counsel adopted observations made in Coro Mainstreet (Inc) v Thames-Coromandel District Council:3
It is not the function of the Court on an application for review to substitute its own decision for that of the consent authority. Nor, will the court assess the merits of the resource consent application or the decision on notification. The inquiry the Court undertakes on an application for review is confined to whether or not the consent authority exceeded its limited jurisdiction conferred by the Act. In practice the Court generally restricts its review to whether the Council as decision maker followed proper procedures, whether all relevant and no irrelevant considerations were taken into account, and whether the decision was manifestly reasonable. The Court has a discretion whether or not to grant relief even if it is persuaded that there is a reviewable error.
Application and Notification – relevant statutory provisions
[36] Pursuant to s 88 of the Act, any application for resource consent must be made in the prescribed form and manner, and it must include the information relating to the activity, including the assessment of the activity’s effects on the environment, as required by Schedule 4.
[37] Schedule 4, cl 2(1)(g), requires that all applications must include an assessment of the activity against any relevant provisions of a document referred to in s 104(1)(b) of the Act. Section 104(1)(b) refers to a number of documents, including the “a plan or proposed plan”. Pursuant to Schedule 4, cl 6(1)(b) and (f), an assessment of an activity’s effects on the environment must include an assessment
of the actual or potential effect on the environment of any proposed activity, as well
3 Coro Mainstreet (Inc) v Thames-Coromandel District Council [2013] NZHC 1163, [2013] NZRMA 442 at [40]; upheld on appeal: Coro Mainstreet (Inc) v Thames-Coromandel District Council [2013] NZCA 665, [2014] NZRMA 73; And see Sutton v Canterbury Regional Council [2015] NZHC 313, [2015] NZRMA 93 at [34], and cases there cited.
as identification of the persons affected by the activity, any consultation undertaken, and any response to the views of any persons consulted. Under cl 7(1)(a), an assessment of the activity’s effects on the environment must address any effect on those in the neighbourhood and, where relevant, the wider community, including social, economic or cultural effects.
[38] Under s 88(3) and (3A), a consent authority may, within 10 working days after an application was first lodged, determine that the application is incomplete. If it does so, it must immediately return the application, with written reasons for its determination
[39] Under s 92, the Council has wide powers to seek further information.
[40] Both public and limited notification of applications are dealt with in ss 95 and
95A-95G. Relevantly, s 95 provides as follows:
95 Time limit for public notification or limited notification
A consent authority must, within 20 working days after the day an application for a resource consent is first lodged,—
(a) decide whether to give public or limited notification of the application; and
(b) notify the application if it decides to do so.
[41] In the present case, the Council decided that Midpoint’s application did not need to be publicly notified. North Western and Tasti do not challenge this aspect of the Council’s decision. Rather, they say that they were affected persons, that the Council should have recognised this, and that it should have directed limited notification on them. Relevantly, ss 95B and 95E provide as follows:
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 to 95G) whether there is any affected person, … 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.
…
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).
…
[42] I now turn to the issues advanced by counsel and noted above at [7].
Challenge to Notification Decision
Did the Council have adequate information before it on which to make the notification decision?
[43] As noted above, one of the issues posed by North Western and Tasti was whether or not the Council had adequate information before it so that it could properly determine whether North Western and/or Tasti were affected persons under ss 95B and 95E of the Act.
[44] Although this formulation of the issue was unchallenged, and indeed adopted, by other parties, I am not persuaded that, regardless of how it is formulated, it is an issue amenable to judicial review.
[45] Prior to 1 August 2003, s 93(1) of the Act provided that a Council’s obligations on receipt of an application, including its obligations in regard to notification, were triggered once it was satisfied that it had received adequate information. This jurisdictional threshold has been repealed.4 There is no longer a statutory requirement that a Council must be satisfied that it has received adequate information. To my mind, as the law now stands, what is amenable to judicial review is the decision the Council makes on notification. The adequacy of the information before the Council may well reflect in the quality of its decision, but the
adequacy of the information itself is not a matter which falls within the scope of s 4 of the Judicature Amendment Act 1972.
[46] Nevertheless, it was common ground between counsel that, in determining who is an affected person for the purposes of notification, the Council must have adequate information before it. For this reason, and in case I am wrong in my view set out above, I deal with the issue, albeit relatively briefly.
[47] Counsel accepted that the appropriate test in determining whether the available information is adequate is that contained in the Supreme Court’s decision in Discount Brands Ltd v Westfield (NZ) Ltd.5 That case concerned a decision made by a Council not to publicly notify a resource consent application to develop a new shopping centre containing mainly discount stores. It was proposed that the new shopping centre would be located outside the then current shopping centres recognised in the district plan and by its “centres-based” policy. The Court noted s 93(1) as it stood at the material time. It held that the Council had to have
sufficiently comprehensive information before it to satisfy itself that the activity did not have an adverse effect on the environment which was more than minor and that it would not have any adverse effect which might affect any person unless it would certainly be de minimus or its occurrence would be a remote possibility.6 The position in regard to the adequacy of information was summarised by Blanchard J as follows:
[114] So, in summary to this point, the information in the possession of the consent authority must be adequate for it (a) to understand the nature and scope of the proposed activity as it relates to the district plan; (b) to assess the magnitude of any adverse effect on the environment; and (c) to identify the persons who may be more directly affected. The statutory requirement is that the information before the consent authority be adequate. It is not required to be all-embracing but it must be sufficiently comprehensive to enable the consent authority to consider these matters on an informed basis.
[115] The statutory requirement addresses more than the scope of the information. The consent authority must necessarily be satisfied as well that the information is reliable, especially so where an expert opinion is tendered. The authority will need to consider whether the author of the opinion is both appropriately qualified to speak on the subject and sufficiently independent of the applicant so as to be seen as giving expert advice rather than acting as an advocate for the applicant.
5 Discount Brands Ltd v Westfield (New Zealand) Ltd [2005] NZSC 17, [2005] 2 NZLR 597.
6 At [6], [23], [24] and [40] per Elias C J; [50], [51] and [57] per Keith J; [101], [106] and [114]
per Blanchard J; [146] and [150] per Tipping J;and [178] per Richardson J.
[48] Discount Brands was decided before the Resource Management (Simplifying and Streamlining) Amendment Act 2009. The Court of Appeal in Coro Mainstreet queried whether the amendments to the Act introduced by the 2009 Act have altered the law expressed in Discount Brands.7 However no counsel sought to take this issue up before me. In the absence of any argument to the contrary, and subject to my comments above, I proceed on the assumption that Discount Brands remains
good law on the issue of the adequacy of the information a consent authority should have when deciding whether or not to notify a resource consent application.
[49] In the present case, I am satisfied that the Council did have sufficiently comprehensive information before it on which it should have been able to satisfy itself whether or not North Western and/or Tasti were affected persons.
(a) It had such information as it was able to glean from the two pre- application meetings, one held on 26 June 2015, and the other on 6
August 2015.
(b)Ms Spyve was familiar with the Te Atatu Peninsula, and with the two consents granted for live/work developments in the block in which the development site was situated. So was Mr Wright.
(c) Ms Spyve and Mr Wright were familiar with the relevant provisions in both the Operative Plan and the PAUP.
(d)Ms Spyve and Mr Wright had before them the application and the Assessment of Environmental Effects prepared by Mr Magee. The Assessment described the proposal and the locality. Relevant rules in both the Operative Plan and in the PAUP were identified. The relevant notified objectives and policies for the Light Industry zone contained in the PAUP were set out, albeit in the context of the assessment required under s 104 of the Act, and not in the context of notification. The property at 753 Te Atatu Road occupied by Tasti was identified under the heading “Sections 95B and 95E – limited
notification”. It was noted that that property shares a common boundary with the development site and that there is a solid concrete block wall between 753 Te Atatu Road and the development site. Photographs of that wall were contained in the application. It was noted that Midpoint proposes to locate a waste area and part of a residential communal garden up against that wall. The view was expressed that there would be no adverse effects on 753 Te Atatu Road as no persons could access the common boundary from within
753 Te Atatu Road, in order to be affected. The opinion was also expressed that redevelopment of 753 Te Atatu Road was “unlikely to result in any changes whereby effects [would] be generated by the proposal [which would be] more than negligible”. Mr Magee stated his view that the adverse effects of the proposed activity on adjoining properties would be less than minor.
(e) Ms Spyve and Mr Wright had the acoustic assessment prepared by Golder Associates. It noted noise levels likely to be received in residential units on the development site by reference to relevant plan rules, and suggested remediation measures that would be required to ensure appropriate noise levels.
(f) Ms Spyve had the information she gained from her site inspection.
She also had the input she received from other Council specialists –
Mr Kan and Mr Griffith – who accompanied her on that visit.
(g)Ms Spyve and Mr Wright had the response from Midpoint to the s 92 request for further information, both from the meeting which was held with Midpoint’s representatives on 8 October 2015, and which was contained in the letter which was sent to the Council dated 15 October
2015.
(h)Ms Spyve had a discussion with Mr Magee around draft conditions, which the Council was seeking to impose as part of any consent to
ensure that any perceived adverse effects would be able to be adequately mitigated.
[50] The information which the Council had before it was not perfect. By way of example, the Assessment of Effects stated that the property at 753 Te Atatu Road was used for commercial activities. It is used for industrial activity. The Assessment did not name adjoining land owners. Midpoint’s reply to the s 92 request for further information did not deal fully with the request, as I explain below.
[51] Nevertheless, in my judgment, there was sufficient information before the Council on which it should have been able to properly assess whether or not North Western and/or Tasti were affected persons pursuant to s 95E. I now turn to that issue.
Were the adverse effects of Midpoint’s proposed activity on North Western and/or Tasti minor or more than minor such that they were affected persons for the purpose of ss 95B and 95E of the Act
[52] In my view this question is not well expressed. It invites a consideration of the merits of the Council’s decision on notification, and that is not part of this Court’s function on an application for review. Rather, I have considered whether or not the Council made a reviewable error in the notification decision.
[53] As I have noted, while the Council did refer to “persons” in part of its decision, its overall conclusion was that Midpoint’s proposed development would have less than minor effects upon adjacent “sites”, and that “sites” within the Working Environment zone were not adversely affected as the proposed activity would not “preclude” activities occurring on those sites in accordance with “the District Plan”.
[54] Three observations can be made:
(a) The Council’s consideration was primarily focussed on “sites”, and
not on persons.
(b) The Council considered whether activities permitted by the District
Plan would be “precluded” if Midpoint’s application were to proceed.
(c) The Council limited its consideration of the adverse effects on adjacent and nearby sites to adverse effects recognised by the District Plan – i.e. the operative plan.
[55] I deal with each of these matters in turn.
[56] In Discount Brands, one issue before the Supreme Court was whether an entity known as Northcote Mainstreet Inc, which was an association of businesses and community interests in a nearby shopping centre, was a person affected. The majority, Blanchard, Keith and Richardson JJ, held that persons from whom written consent was required under what was then s 94(2)(b) of the Act, were persons with property rights or interests who might suffer direct, albeit minor, environmental effects. The majority considered that Northcote Mainstreet Inc was not a person from whom written consent needed to be obtained. Although there was no doubt it was a person in terms of s 2 of the Act, it did not itself have any property rights or interests, and hence could not suffer any adverse effects. Tipping J agreed that there needed to be a property right involved, but held that Northcote Mainstreet Inc’s consent was required because at least one of its members had a property interest. Elias CJ disagreed that an affected person needed to be an owner or occupier of land; she considered that that approach would confine the way in which people could be affected, which would be inconsistent with the wide definition of the word
“environment” contained in the Act, and its policies.8
[57] Here, Midpoint’s application did not identify the owners/occupiers of adjoining sites, or of other sites within the Working Environment zone in Te Atatu. Moreover, there is nothing to suggest that the Council made any effort to identify the
persons who owned or occupied other sites in the zone; nor did it consider whether
8 Discount Brands Ltd v Westfield (New Zealand) Ltd, above n 5, at [6], [37], [38], [57], [110], [111], [112], [127], [152], [159], [166], [172], [177] and [179]; and see Northcote Mainstreet Inc v North Shore City Council [2006] NZRMA 137 (HC); Royal Forest and Bird Protection Society of New Zealand Inc v Kapiti Coast District Council HC Wellington CIV-2007-485-635, 21
November 2007; Auckland Regional Council v Rodney District Council [2009] NZCA 99, [2009] NZRMA 453.
or not it would have been unreasonable to require Midpoint to seek the written approval of those owners/occupiers pursuant to s 95E(3)(b). Rather, the Council’s decision suggests that its consideration was primarily focussed on “sites”.
[58] Section 95E(1) required the Council to decide if there were any affected persons. In my judgment the Council asked itself the wrong question. The primary focus of its enquiry should have been on persons, not sites.
[59] The submissions concentrated on the adverse effects alleged by North Western and Tasti. These concerns were well summed up by Mr MacLean, Tasti’s chief financial officer. In his affidavit he stated as follows:
Tasti’s management team hold a considerable concern that our operations risk becoming constrained by nearby residential use located within the zone, which will over time restrict our freedom of hours of operation, lead to tighter noise and other restrictions, will constrain opportunities to develop within present land holdings. For instance, if future needs require, the raw materials warehouse which borders the proposed development could be used for manufacturing, or dismantled. In addition there is concern at the erosion of the industrial land at Te Atatu which retail and residential activities.
[60] Mr MacLean was referring to what is known as reverse sensitivity. Reverse sensitivity has been described by the Environment Court as:9
… the legal vulnerability of an established activity to complaint from a new land use. It arises when an established land use is causing adverse environmental impact on nearby land, and the new, benign activity is proposed for the land. The sensitivity is this: if the new use is permitted the established use may be required to restrict its operation or mitigate its effects so as not to adversely affect the new activity.
The Environment Court has accepted that reverse sensitivity can be a relevant effect on the environment.10
[61] Mr Haines, the consultant planner retained by North Western and Tasti, in his affidavit, identified noise as a principle reverse sensitivity effect where residential
uses establish in an industrial zone. He also referred to lighting, glare and vibration
9 Affco New Zealand Ltd v Napier City Council NZ Env C Wellington W082/2004, 4 November
2004 at [29].
10 Derek Nolen (ed) Environmental and Resource Management Law (5th ed, LexisNexis, Wellington, 2014) at 905.
effects which can arise from the carrying out of industrial activities and which can adversely affect residential amenity.
[62] Under the operative plan, reverse sensitivity effects receive only limited recognition.
(a) As noted, dwellings are permitted in the Working Environment but only where the use of the dwelling is subsidiary to a non residential activity on the same site.
(b)Rules for residential activities within the Working Environment zone require that residential buildings must be designed to achieve an average internal noise level in any habitable room of 45 dB LAeq at any time, an average level of 45 dB LAeq between 07:00 – 22:00, and a level of 35 dB LAeq (15 minutes) between 22:00 and 07:00 in bedrooms and studios.
The operative plan does not provide for external noise amenity. Nor does it contain a maximum noise level – known as the L max – for one off short duration noises (bangs) such as might be experienced if, e.g. a container was dropped. There is no recognition given to other potential reverse sensitivity effects.
[63] Midpoint’s application dealt with noise, but only to a limited extent. The Golder & Associates report cited the rules from the operative plan and dealt with noise attenuation within the proposed residential units. The report was based on an assumed worst case scenario with noise levels at 65 dB LAeq at the boundaries of the development site. This is the noise permitted at site boundaries within the Working Environment zone. The report predicted the worse case noise levels at the facades of the proposed residential units, and identified attenuation requirements for those various building facades to protect residential amenity within the units.
[64] The rules that will be included in the PAUP are not as yet finalised. Nor are the policies and objectives. It can, however, be said that the notified policies and objectives in the PAUP, if recommended as notified, and if accepted by the Council,
will afford rather greater protection for those whose activities are located in the proposed light industry zones. As set out in [22] above, the PAUP’s objectives and policies for light industry zones seek to avoid the establishment of activities that might diminish the efficiency and functionality of the zones for industrial activities. The policies seek to avoid activities that create reverse sensitivity effects, and that could constrain the establishment and operation of light industrial activities. They seek to avoid residential activities other than by those persons whose duties require them to live on site.
[65] Mr Haines expressed the view that the PAUP is likely to introduce a new direction for planning in the light industry zones. Mr Wright accepted that the PAUP contains a number of objectives and policies that differ from those contained in the Operative Plan for the Working Environment zone. So did Mr Brian Putt, a consultant planner retained by the Council to review its handling of Midpoint’s application. Conversely, Mr Magee stressed the uncertainty which presently attaches to the PAUP.
[66] In the notification decision the Council recorded Midpoint’s assertion, based on the Golder & Associates’ report, that reverse sensitivity effects had been addressed through acoustically treating the proposed residential units to ensure that the proposal can avoid effects associated with noisy non residential activities arising both within and exterior to the development site. No consideration was given by the Council to noise levels likely to be experienced outside the residential units, or to other reverse sensitivity effects which might impinge on residential amenity, for example light spill, glare and vibration.
[67] Ms Spyve seems to have been aware of the potential for reverse sensitivity effects, other than just noise, to occur. In her s 92 request, above para [23], she expressly noted that the application did not consider activities that generate odours. She also referred to the hours of operation associated with activities in the working environment. She asked Midpoint to demonstrate how the proposal would manage effects associated with these issues. As noted, there was a subsequent meeting between Council officers, including Ms Spyve, and Mr Magee. While the detail of what was discussed is not in the evidence, in her affidavit Ms Spyve did say that
possible reverse sensitivity issues relating to light spill and vibration were not raised as she did not consider them to be relevant. Moreover Midpoint’s response to the s
92 request – above para [24] – did not answer the Council’s request for further information in relation to odour or the hours of operation of other activities in the zone. Rather, it dealt with internal protections proposed to be offered within the proposed residential units.
[68] To my mind it is rather odd that Midpoint, in its response, dealt exclusively with reverse sensitivity effects within the development site. It was acknowledging that they could occur within the development site but it was silent about the possibility that they could affect adjoining or nearby sites.
[69] It does not appear that Ms Spyve appreciated this. In particular there is nothing to suggest that she raised with Mr Magee Midpoint’s failure to address in full the s 92 request.
[70] The Council did very briefly consider reverse sensitivity effects on Tasti/North Western in the notification decision, but only by reference to the operative plan, and only in relation to noise. In my judgment, the Council’s enquiry did not go far enough.
[71] The Council stated that the proposed live/work development would not “preclude” activities occurring on other sites within the zone, and that therefore those sites were not adversely affected. I agree with Mr Ryan that the Council adopted the wrong test. A person is an affected person if the activity’s adverse effects on that person are minor or more than minor, but are not less than minor. The standard is not high – a minor impact is enough.11 It is not necessary for the proposed activity to “preclude” permitted activities occurring on other sites in the zone. It suffices if persons carrying out permitted activities could be limited or
constrained in so doing in a minor or more than minor way. In my judgment the
Council again asked itself the wrong question. It set the bar too high.
[72] The Council’s notification decision did not refer to the policies and objectives in the PAUP. Indeed it made it clear that the only planning document considered was the District or operative plan. Ms Spyve in her affidavit said that she considered that the objectives and policies in the PAUP were irrelevant to the notification decision. She asserted that only a select category of rules in the PAUP had legal effect at the time, and that, in any event, the PAUP had not been finalised. She accepted that the PAUP objectives and policies were relevant, but only in relation to the consent decision required to be made under s 104 of the Act.
[73] Ms Spyve’s view is consistent with views expressed by Mr Magee and Mr
Putt.
[74] Mr Wright recorded his understanding that ss 95A – 95E of the Act do not expressly provide for a decision maker to consider plan matters when making decisions whether or not to notify applications, although he then went on to say that when he made both the notification decision and the consent decision, he was aware of the relevant provision in the operative plan and the PAUP. The difficulty with this latter assertion is that it is inconsistent with the terms of the notification decision.
[75] It is the decision itself which is the subject of the review application, and not what Council officers, with the benefit of hindsight, say they did or did not do in their affidavits.12 Nor is it helpful for parties to applications like this to file voluminous affidavits by planners seeking to criticise or support the Council’s decision. It stands to be considered in its terms and no amount of ex post facto criticism or justification can change it.
[76] Ms Rice, on behalf of the Council, and Mr Braggins, on behalf of Midpoint, pointed out that there is no mandatory requirement in the notification provisions contained in the Act which obliged the Council to consider the policies and objectives in the PAUP. They emphasised that the PAUP was but a proposed plan at the time the notification decision was made. They drew a comparison between the notification provisions and the provisions in s 104. The latter expressly require that consideration be given to objectives and policies in proposed plans. They submitted
that the policies and objectives in the PAUP were irrelevant to the notification decision, and that the likelihood that the reverse sensitivity provisions may be strengthened if the PAUP is adopted as notified, is equally irrelevant.
[77] Mr Ryan for North Western and Tasti, accepted that the objectives and policies for the Light Industry zone in the PAUP were not an express mandatory consideration. Rather he argued that the overall planning framework is necessarily a relevant consideration, when assessing the effects on persons (and the environment) for notification purposes. He referred to the observations of Elias CJ in Discount Brands,13 as follows:
[17] In context, therefore, the application in the present case had to be assessed against any adverse impact it might have on the amenity values of existing shopping centres, and the policies identified in the district plan to confine business activities generally to centres within North Shore City identified by the plan. It required the “thorough evaluation” provided for by policy 4, designed in particular to consider the impact upon the amenity values of the existing centres. And in policy 5 it looked to the “advocacy” of community-based groupings in the identification and promotion of “the essential qualities of individual centres.
…
[25] The assessment that the effects on the environment of the proposal were minor was not one the Council was called upon to make in a vacuum. It had to be considered in the context of the legislation and the district plan. It was a determination of participation, rather than a judgment on the merits of the application made after hearing all those interested. I agree with Keith J that such determination touched on the scope of the right to be accorded natural justice. The decision not to notify an application is an exception to the general policy of the Act that better substantive decision-making results from public participation. The requirement that the consent authority must be “satisfied” that effects are minor before deciding not to notify a resource consent application to undertake a discretionary or non- complying activity is a requirement of caution. The consent authority must be clear that notification would not elicit information or perspective which would cause it to view the effects of the activity on the environment as more than minor.
…
[29] I am unable to accept that the decision made is one the Council could have come to if it had addressed itself to that preliminary question. The substantial criticisms made of the information supplied by Discount Brands Ltd by the Council's own officers, and the
13 Discount Brands v Westfield New Zealand Ltd, above n 5.
absence of any reasons in the decision for rejecting their advice, demonstrate that the material relied on was highly contestable, even on its own terms. As Randerson J in the High Court and Blanchard J in this Court have pointed out, the conclusion (critical to the Council's decision on both s 94(2) (a) and (b)) that the proposed activity was complementary with existing centres because not competing in the same market was based on questionable methodology in a deficient report. The imposition of a condition designed to maintain that market distinction suggests that, in its absence, more than minor adverse impact upon the amenity values provided by the existing centres could not be excluded. The proposal was of a scale which impacted upon prominent policies in the district plan. As such, it required the “thorough evaluation” promised by the plan for its impact upon the amenities, including the community focal points, provided by the existing centres. Against this background, and in the absence of any reasons given by the Council for not accepting the criticisms of the application by its officers, it cannot be assumed that the Council would have reached the conclusion not to notify if it had addressed the proper question. I am of the view that the Council's consideration of the notification determination miscarried and that its decision cannot stand.
(Italics added)
[78] He also referred to the observations of Blanchard J:
[99] There can be no question that, in light of these definitions and of the policies of the North Shore City Council's District Plan, an adverse effect, actual or potential, on the amenity values of existing shopping centres on the North Shore required an assessment in the application by Discount Brands and that the Council was entitled to seek further information on this question under s 92. Indeed, Discount Brands does not suggest otherwise.
[79] In Discount Brands the Court was faced only with an operative district plan. There was no proposed plan. Nevertheless the citations referred to by Mr Ryan are, in my view, apposite. I agree with Mr Ryan’s submission that an assessment of who is an affected person for the purposes of limited notification under s 95E, cannot occur in isolation.
[80] The words “affected person” are defined in s 2AA of the Act as meaning a person who, under s 95E, is decided to be an affected person in relation to an application. That definition is singularly unhelpful. Section 95E requires that a Council must decide that a person is an affected person if the activity’s adverse effects are minor or more than minor. The focus of the enquiry required is on the extent of the effects. If they are minor or more than minor there is a mandatory duty
to conclude that the person is affected ; this finding in turn triggers the mandatory obligation to give limited notification under s 95B(2). I agree with the commentators that a broad or liberal approach should be taken to the interpretation of the words, given the principle that affected persons should be able to participate in matters that affect them if they wish to do so.14
[81] Consideration of the context in which the notification decision needed to be made is informative. A decision whether or not to notify an application either publicly or on a limited basis, must logically precede the decision on the application itself. When considering an application for a resource consent under s 104(1), the consent authority is required to have regard to various specific matters, including any relevant provisions of a plan or proposed plan. Similarly, under s 104D(1), a consent authority may grant a resource consent for a non notifying activity, only if it is satisfied in regard to various specified threshold matters. Where there is a relevant operative plan and a relevant proposed plan, it has to be satisfied that the application is for an activity that will not be contrary to the objectives and policies of both plans.
[82] If the policies and objectives contained in a proposed plan are required to be taken into account in making the substantive decision on the resource consent application, then, in my judgment, it is axiomatic that they must be relevant in determining whether a person is affected by the application, so as to require that the consent authority find the person to be effected under s 95E(1), and then give limited notification of the application to that person pursuant to s 95B(2).
[83] Both Mr Braggins, and to a lesser extent, Ms Rice, argued that any development by Tasti and/or North Western at or close to the common boundary is fanciful, and that as a result, potential reverse sensitivity effects should be discounted.
[84] With respect to Mr Braggins, this argument invites the Court to trespass into the merits of the matter. Moreover it is inconsistent with s 3 of the Act. It defines
14 Environmental and Resource Management Law (online looseleaf ed, LexisNexis) at [4.55] and fn 1];And see Quarantine Waste (NZ) Ltd v Waste Resources Ltd [1994] NZRMA 529 (HC); Discount Brands Ltd v Westfield (NZ) Ltd, above n 5; Associated Churches of Christ Church and Property Trust Board v Auckland Council [2014] NZHC 3405, [2015] NZRMA 113 at [56].
the word “effect” to include any future effect, any potential effect of high probability, and any potential effect of low probability which has a high potential impact. Whether or not the reverse sensitivity effects feared by North Western and Tasti fall within these definitions, or whether they are cumulative effects which could arise over time, or in combination with other effects, is a matter for the Council to determine in accordance with the law. They should not, without hearing and properly considering all relevant material, be dismissed as fanciful in the context of an application for review. The fact that North Western has spent large sums of money buying additional land in the immediate vicinity might suggest that further expansion of Tasti’s operation onto available land is not fanciful. Ultimately however this is a matter for the Council.
[85] In my judgment, the Council has erred in its notification decision. First, it considered sites, and not persons as required by s 95E(1). It misconstrued the relevant statutory provision, and erred in law in doing so. Secondly, the Council did not consider potential reverse sensitivity effects other than noise in any detailed or proper way. Moreover its consideration of noise was limited to noise within residential units. It did not consider noise exterior to the residential units, or one off loud bangs which may happen from time to time. Nor did it consider matters such as light spill, glare, vibrations and the like. Its enquiry was too narrow. Again, the Council asked itself the wrong question, and did not undertake a detailed investigation of potential reverse sensitivity effects to determine whether or not any person was adversely affected by the proposal that residential uses should locate in an industrial zone. Thirdly, in considering whether or not a person was affected, the Council poses too high a test. The notification decision suggests that it considered that permitted activities within the zone needed to be precluded by the proposed residential activity before a person carrying out an activity could be said to be affected. That is not the test posed by s 95E(1). Again, the Council erred in law, and again it asked itself the wrong question. Finally, the Council did not address the objectives and policies in the PAUP at all. It failed to take into account the fact that those objectives and policies, if adopted as notified, are likely to afford rather greater protection to existing land owners/occupiers in the Te Atatu Working Environment/Light Industry zone.
[86] In my judgment, the Council erred in law by asking itself the wrong questions, and by failing to take into account relevant considerations. As a result, its conclusion that North Western and Tasti were not affected is flawed and the notification decision is invalid.
Did the Council err in considering or failing to consider relevant objectives and policies contained in the PAUP, in determining who was an affected person for the purposes of ss 95B and 95E of the Act
[87] This question runs together with the question I have just dealt with. The Council did not consider the relevant objectives and policies contained in the PAUP. For the reasons I have set out, these were relevant matters, which the Council should have taken into account.
Challenge to the Consent Decision
[88] Given my conclusion that the notification decision is flawed and invalid, it must follow that the consent decision is also deficient. The notification decision comes before the consent decision. If the notification decision is invalid, the Council needs to reconsider that issue and deal with it according to law, before going on to consider whether or not consent should be granted to Midpoint’s proposed development.
[89] Mr Ryan made extensive submissions in relation to the Council’s consent condition. Many of his arguments overlapped with his argument in relation to the notification decision. I do not consider it appropriate to address the same, given my conclusions in relation to the notification decision. As a result of my decision, the Council will have to revisit the notification decision, and then the consent decision. It is preferable that I do not express a view on the matters the Council will be required to consider in doing so.
Challenge to the Variation Decisions
[90] As noted above – at [6] – it was common ground that the variation decisions are an integral part of the consent decision, and that if it falls, so must the variation decisions.
Relief – should the Court, in the exercise of its discretion, grant relief to North
Western and Tasti?
[91] The Court has a discretion whether or not to grant the relief sought by North Western and Tasti. Various factors have typically been discussed by the Courts when considering the exercise of the discretion – for example whether innocent parties would be unduly prejudiced, whether an applicant has delayed and the like. Counsel accepted that each case needs to be looked at on its own facts.
Submissions
[92] Ms Rice and Mr Braggins argued that the discretion should be exercised against North Western and Tasti. They submitted that there are no adverse effects that are minor or more than minor that cannot be adequately mitigated and/or avoided by the conditions of the resource consent and/or by the additional conditions imposed in the variation decisions. In particular they argued that the variation decisions impose a reverse sensitivity covenant which provides North Western and Tasti with all the protection they can reasonably expect.
[93] Mr Braggins submitted that Midpoint reached out to Tasti to see if the reverse sensitivity effects of concern could be resolved as between the parties. He referred to the affidavit evidence which suggests that Tasti refused to meet and submitted that its conduct in this regard was unreasonable. He noted that notwithstanding Tasti’s rebuff, Midpoint actively sought to address Tasti’s concerns by varying its resource consent, to address the matters raised by North Western/Tasti’s noise consultant, and to provide Tasti with reverse sensitivity protection by way of covenants which will be registered against the unit titles in the proposed development. Mr Braggins also offered an undertaking on behalf of Midpoint that his client would make further application to the Council if required to do so, and take such steps as are reasonably necessary, to ensure that the covenants apply to all of North Western’s land, and further, that the covenants apply to all owners and occupiers of residential units in Midpoint’s development. Mr Braggins also pointed out that relatively late in the day, Tasti obtained consent for a similar development, albeit without the residential component. He argued that therefore the Council would not be able to take account
of any issues associated with the loss of industrial land, even if that matter is referred back to the Council.
[94] Mr Ryan argued that the decision not to give limited notification to North Western/Tasti, has had significant consequences. He argued that it deprived them of the right to participate in the determination of the consent application. He argued that if they are afforded that right, it cannot be said that the Council will inevitably reach the same conclusion. Rather he said that the Council will be required to consider the matter afresh according to law. He argued that it was not appropriate to pre-judge the outcome. He also took issue with the additional conditions contained in the variation decisions. He noted that they do not cover all land owned by North Western, and argued that it was unclear whether or not they will apply to all owners/occupiers/lessors of residential units. He queried whether or not a tenant could be said to be a lessor, and then went on to pose the issue of whether or not others could complain – for example flatmates. He also noted that there were no covenants proposed in regard to future development, and that there is no indemnity for costs if North Western and/or Tasti are required to enforce the covenants.
[95] In regard to the more recent application lodged by Midpoint, he noted that neither North Western nor Tasti were aware of that application until very recently. The affidavits disclose that the application was only filed in mid May 2016, and that it was granted by the Council on 14 June 2016. North Western and Tasti were only told of it a few days prior to the hearing. He advised that his clients would be taking steps to challenge this further decision made by the Council.
Analysis
[96] Against this background I turn to consider the exercise of the discretion. The default position is to grant relief, and there must be strong reasons to refuse it.15
[97] Here, there can be no suggestion that North Western/Tasti were guilty of delay. Although it is clear from the affidavits filed on behalf of Midpoint there has
been strong interest in its proposed live/work development and that four agreements
15 Air Nelson Ltd v The Ministry of Transport [2008] NZCA 26, [2008] NZAR 139 at [60]-[61];
Independent Fisheries Ltd v Minister of Earthquake Recovery [2012] NZHC 1810 at [186].
for sale and purchase have been signed, it does not seem that there will be any irrevocable prejudice to third parties if relief is granted. I am not persuaded that the most recent application lodged by Midpoint is relevant. It was a pre-emptive attempt at a king hit by Midpoint. As I have indicated, North Western and Tasti have indicated that they will be challenging the Council’s decision on this application as well. I do not consider that it advances matters.
[98] The proposed covenants set out in variation decisions do however cause me to pause. I have set out above at [32] the additional conditions added to the consent decision. I acknowledge Mr Ryan’s argument that the conditions as they stand do not provide North Western and Tasti with all the protection they might like, but I note Midpoint’s undertaking to seek to vary the conditions.
[99] Having considered the matter in the round, I am not persuaded I should exercise my discretion to decline relief to North Western and Tasti. In my judgment, the Council made some relatively fundamental errors in its notification decision. It needs to go back and reconsider notification by reference to the matters I have set out in this judgment. It may or may not reach the same conclusion. North Western and Tasti have established that the Council’s actions to date have been unlawful. It should not be necessary for North Western and Tasti to go further and show
additional justification for the remedy they seek.16 Further I do not consider that
North Western and Tasti should be foist with conditions, when there is a possibility that the application may be declined. It may ultimately be decided that it is better to avoid potentially incompatible land uses co-locating, rather than to impose a “band aid” solution against the wishes, and without the input, of potentially affected parties.
[100] I accept that there has been prejudice to North Western and Tasti. The Council exceeded its limited jurisdiction, and failed to properly consider whether or not North Western and Tasti should be given limited notification. The Court should be cautious about exercising the discretion not to set aside the Council’s unlawful decision. There is nothing in the present case which is exceptional. Nor are there
extremely strong reasons which justify declining relief.
16 MacPherson v Napier City Council [2013] NZHC 2518, [2015] NZAR 342 at [93].
Result
[101] For the reasons I have set out above, I am satisfied that the Council erred in law. Its notification decision, the consent decision and the variation decisions are flawed, and they are quashed as being invalid. The matter is sent back to the Council to consider afresh and according to law. It goes without saying that the matter should be reconsidered by independent planning officers who have had no role to play in the matter to date.
Costs
[102] North Western and Tasti are entitled to their reasonable costs and disbursements. If the parties are unable to agree costs, I direct as follows:
(a) any application for costs by North Western and Tasti is to be made by way of memorandum, to be filed and served within 10 working days of the date of release of this judgment;
(b)any replies from the Council and Midpoint are to be filed and served, again by way of memorandum, within a further 10 working day period;
(c) memoranda in relation to costs are not to exceed 10 pages;
I will then deal with the issue of costs on the papers, unless I require the assistance of counsel.
Wylie J
“A”
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