Te Puaha O Waikato Whanui Trust v Franklin District Council HC Rotorua Civ-2004-404-004435

[2005] NZHC 1686

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2004-404-004435

UNDER

Part I of the Judicature Amendment Act 1972

IN THE MATTER OF

the Public Works Act 1981 and the Local Government Act 2002

BETWEEN

TE PUAHA O WAIKATO WHANUI TRUST

Applicant

AND

FRANKLIN DISTRICT COUNCIL

Respondent

Hearing:

2 and 3 May 2005

Appearances: Prue Kapua and Kelly Fox for Applicant

Heather Ash and Bronwyn Carruthers for Respondent Judgment:      3 May 2005

JUDGMENT OF HARRISON J

SOLICITORS

Tamatekapua Law (Auckland) for Applicant Simpson Grierson (Auckland) for Respondent

TE PUAHA O WAIKATO WHANUI TRUST V FRANKLIN DISTRICT COUNCIL HC AK CIV-2004-404- 004435 [3 May 2005]

Introduction

[1]    The applicant is a charitable trust. It is a representative body of tangata whenua from the area of Port Waikato. It is empowered to administer the ancestral lands and other taonga for that area.

[2]    The Franklin District Council (FDC) is a territorial local authority. The camping ground at Port Waikato is within its boundaries. This proceeding concerns rightful ownership of that property. Without doubt the two hapus represented by the Trust enjoy close ancestral ties to it. By virtue of that relationship the Trust challenges decisions made by Council in 2004 to sell the camping ground to its existing lessee.

[3]    Both sides have filed extensive affidavits but cross-examination of the deponents was unnecessary. I have also had the benefit of written submissions. I am able to deliver judgment immediately after the conclusion of oral argument because I am satisfied that the relevant issues are amenable to immediate decision.

Background

[4]    I can not do better than adopt the succinct summary of the background circumstances, distilled by FDC’s counsel, Ms Heather Ash and Ms Bronwyn Carruthers, from the affidavits. They are as follows:

1)The Committee of Missionaries of the Church of England, a predecessor to the New Zealand Mission Trust Board, purchased property from the local iwi in return for payment in 1839. This property included the land known as the motor camp.

2)The New Zealand Mission Trust Board resolved to offer the motor camp to the Council at its meeting on 4 February 1937. It was already being used as a camping ground at this time.

3)The motor camp was purchased by the Raglan County Council from the New Zealand Mission Trust Board in return for payment. Payment was made in 1943, with the transfer being recorded on the title in 1951.

4)In 1989 local government was reorganised as recorded in the Local Government (Auckland Region) Reorganisation Order 1989. The

Raglan County Council was combined with four other county and borough councils and two reserve boards to constitute the respondent. This reorganisation came into force on 1 November 1989.

5)In 1986 the land listed in the First Schedule to the New Zealand Mission Trust Board (Port Waikato Maraetai) Empowering Act 1986 was returned to the Port Waikato Maraetai Trust. This was a purely voluntary return on the part of the New Zealand Mission Trust Board. It only related to the land listed in the First Schedule, which was land still in the ownership of the Church.

6)On 13 June 1986 the Council wrote to the District Lands Registrar in an attempt to ascertain the status of its land title for the motor camp. By letter dated 23 June 1986 the District Lands Registrar advised that there were no limitations or restrictions on the title and confirmed that the respondent did not acquire the land as Crown Grantees.

7)The Council called for tenders in August 1986. The motor camp  was leased to Mr and Mrs Reynolds Bavister in July 1988.  The  lease was assigned to Mr and Mrs Markham in October 1988, then to Mr and Mrs Eva in December 1999, and then to Mr and Mrs Brock (the ‘current lessees’) in November 2002.

8)By 2002 the deed of lease included a right to purchase and a first right of refusal. In September 2003 the Council received from the current lessees a request to purchase the property.

9)Council officers reported to the Council in November 2003 regarding the request to purchase. The Council accepted the  officer’s recommendations and resolved the following:

‘A.That council approve the sale of the Port Waikato motor    camp in principle, subject to a formal consultation process being undertaken as required to satisfy the conditions of council’s significance policy by way of direct contact with appropriate community groups.

B. That the total property be  offered  for  sale,  in  the  first  instance, to the current lessees, C and C Brock, for the sum of $535,000 including GST, being the assessed current market value or such lesser amount as agreed by the chief executive, mayor and lessee should any subdivision occur as the result of consultation.’

10)Council officers were instructed to consult on the proposal and report back to Council. Consultation with appropriate community groups then occurred. The details of the consultation undertaken are outlined in more depth below in response to the second cause of action.

11)The matter was reported back to Council on 22 July 2004. The Council considered the report and resolved as follows:

‘Council declares the [property] surplus to requirements under the Public Works Act 1981 and enters contract negotiations with the current lessees as detailed in Part B of Resolution 2003/11/34 (Public Excluded).’

[5]    The lessee’s right of purchase is found in a rather obscure part of the deed. It is included within the Second Schedule, as clause 46. Its terms are not clear. But neither counsel addressed me upon the provision’s enforceability or its relationship to FDC’s relevant statutory obligations. I am proceeding on the premise that the Trust does not challenge the existence of the lessee’s enforceable right to purchase the property.

Trust’s case

[6]    Stripped to its core, the Trust’s case is that FDC acted unlawfully in passing both its November 2003 and July 2004 resolutions (set out in para 4(9) and (11) above). Its claim is based on Council’s alleged failure to take account of its obligations under the Public Works Act 1981 and the Local Government Act 2002.  It seeks a range of remedies principally designed to quash or set aside FDC’s decisions contained in its resolutions.

[7]    The Trust’s statement of claim is diffuse and unenlightening. However, in  her written synopsis Ms Prue Kapua, counsel for the Trust, submitted that FDC held the camping ground for public purposes under the Public Works Act. Her primary submission is that having found the Act applied, Council failed to perform its functions under it or separately under the Local Government Act. Ms Kapua submits in particular that FDC failed to satisfy its statutory duty to offer the land back to the New Zealand Mission Trust Board or its successor.

[8]    While I accept that Council’s second resolution is framed on the premise that the Public Works Act applied, Ms Ash submits that the correct legal position is otherwise. She  says  the  camping  ground  was  never  acquired  for  public  works (s 12(2) Counties Amendment Act 1927). Instead it was purchased through the normal process of commercial negotiation between willing buyer and seller. I accept that s 12(1)(a) Counties Amendment Act empowered Council’s predecessor to

purchase the land for the use of the public’s enjoyment or convenience; clearly the purchase falls within its purview. However, Ms Ash’s point is that the statute uses the phrases “purchase” and “acquire” disjunctively. On her argument the former concept applies to this transaction effected in 1943; the latter applies to the different situation of compulsion, coercion or forced taking. S12(2) only deems land which is acquired as opposed to purchased to be a public work.

[9]    I acknowledge the force of this submission. However, it is unnecessary for me to determine it today. Even if the land is deemed to be a public work, the provisions of the Public Works Act do not assist the Trust. Council was subject to a well known and oft litigated obligation where the camping ground was no longer required for public work (s 40(1) Public Works Act). In that event it (s 40(2)(b) and (c)):

… shall offer to sell the land by private contract to the person from whom it was acquired or to the successor of that person … at the current market value of the land as determined by a valuation carried out by a registered valuer…

[Emphasis added]

[10]   Ms Ash submits that this duty is restricted to land which is acquired as opposed to purchased (Port of Gisborne v Smiler & Ors [1999] 2 NZLR 695). Accordingly, s 40(2) does not apply to the camping ground. Again it is unnecessary for me to determine this submission. What is determinative is that Council’s obligation, assuming it existed under the Act, was to offer the land back to the person from whom it was acquired or its successor. The obligation is subject to the important qualification that the appropriate offeree pays current market value. The only party entitled to enforce this statutory right would be the one aggrieved by Council’s failure to comply. In this case, as Ms Kapua acknowledges, it would be the New Zealand Mission Trust Board or its successor.

[11]   Yesterday I granted Ms Kapua  an  adjournment  of  this  proceeding  until  10 a.m. today. The purpose is set out in my minute issued contemporaneously. Essentially I was granting her an indulgence to obtain instructions from the correct legal entity to seek leave to join this proceeding as an applicant.

[12]   This morning Ms Kapua reported fully on events. In the limited time available she had made inquiries of relevant parties. Contrary to her original understanding, the New Zealand Mission Trust Board continues to exist. It has devolved land to a number of smaller trusts throughout the country. The last devolution was to Otamataha Trust on 10 March 2005. That entity is now the legal successor to the Board. Ms Kapua was unable to obtain the necessary instructions from it to apply for leave for joinder. Nevertheless, Ms Kapua repeated her submission that the Trust had a sufficient interest and what she described as an implied statutory right “to support this application”.

[13]   I do not need to repeat what I have already said. I am satisfied that the Trust has no status to challenge Council’s decision on the ground of a failure to comply with the Public Works Act. Even if the Trust was able to establish unlawfulness, I would not exercise my discretionary jurisdiction where its ultimate effect is to direct Council at the Trust’s behest to offer the land for sale at current market value to a different legal entity which by its silence or inaction has affirmed FDC’s decision or at least waived any entitlement to challenge, signifying that it does not wish to exercise its statutory right, assuming one exists, to purchase. In this respect I am satisfied that the New Zealand Mission Trust Board or its successors had notice of Council’s decision. The Most Reverend Whakahuihui Vercoe, Archbishop of the Anglican Church of Aotearoa, and the Right Reverend Muru Walters, Bishop of the Anglican Church, swore affidavits in support of the Trust’s application.

[14]   The remaining issue is whether or not Council’s resolutions are unlawful for failure to comply with the Local Government Act. With respect, the trust’s case on this point was not advanced in a satisfactory manner. Its statement of claim was long on recitals but short on particulars. Ms Kapua’s submissions suffered from a failure to identify in a logical and structured way the area or areas in which FDC allegedly breached its duties. Rather, the Trust’s case evolved during Ms Kapua’s oral argument.

[15]   Ultimately Ms Kapua settled on alleged breaches of s 77(1)(a) Local Government Act. That provision obliges a local authority “in the course of  a decision making process [to] seek to identify all reasonably practicable options for

the achievement of the objective of a decision”. After discussion she identified two “reasonably practicable options” which she said Council failed to identify or consider for the purpose of achieving its objective of selling the land. The first was the option of returning the camping group or some portion of it to the iwi. However, if Ms Kapua’s principal argument is correct that the land is subject to the Public Works Act, Council had no power to or purpose in taking this step. By Ms Kapua’s admission, it could only offer the land back to another party. The inconsistency between the two positions does not require further emphasis.

[16]   The second option was to find “some management or co-management role [for the hapu] relating to the land”. Ms Kapua did not elaborate or explain how this role might be exercised if and when the last passed to private ownership. Nor did  she explain its relationship to Council’s contractual obligation to comply with the lessee’s exercise of their option to purchase. I cannot see its relevance or validity in this context.

Conclusion

[17]   The Trust has failed to prove its case. It has not established that Council  acted unlawfully in passing either or both resolutions. In making that observation I am not finding that a  claim  by  the  rightful  legal  entity,  assuming  contrary  to  Ms Ash’s submission that the Public Works Act applies, would necessarily fail. Nor am I finding that a conceptually sound argument advanced by the Trust in accordance with settled principles of public law under the Local Government Act is untenable. I am simply recording that on the Trust’s case as framed and argued I am not satisfied that Council acted unlawfully.

[18]   I dismiss the Trust’s application. In the normal course costs follow the event. By consent I order the Trust to pay Council’s costs according to category 2B for two counsel. I record Ms Ash’s instructions to apply for indemnity costs. I would have considered that submission favourably given my conclusion that the Trust’s case was hopeless. However, I am mindful of its status as a charitable trust and its doubtless limited financial resources.

Rhys Harrison J