Thompson v Invercargill City Council
[2019] NZHC 3506
•31 December 2019
ORDER SUPPRESSING REDACTED PASSAGES IN PARAGRAPHS [28] AND [29] AS HIGHLIGHTED IN THE HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY
I TE KŌTI MATUA O AOTEAROA WAIHŌPAI ROHE
CIV-2019-425-144
[2019] NZHC 3506
UNDER Judicial Review Procedure Act 2016 IN THE MATTER OF
an application for judicial review of a
decision not to notify and to grant a variation to resource consent conditions under
Resource Management Act 1991, ss 95-95E and 127
BETWEEN
LEWIS GAIRE HERDMAN THOMPSON
Applicant
AND
INVERCARGILL CITY COUNCIL
First Respondent
HWCP MANAGEMENT LIMITED
Second Respondent
Hearing: 30 December 2019
(By way of telephone conference)
Appearances:
S Gepp and F McDonald for Applicant R Donnelly for First Respondent
J Ormsby and T Brown for Second Respondent
Judgment:
31 December 2019
JUDGMENT OF MANDER J
[1] Mr Lewis Thompson has applied to judicially review decisions of the Invercargill City Council (the Council) not to notify an application by HWCP Management Ltd (HWCP) to vary the conditions of resource consents for the
THOMPSON v INVERCARGILL CITY COUNCIL [2019] NZHC 3506 [31 December 2019]
demolition, alteration and redevelopment of a block of the Invercargill central business district (the CBD), and to grant that application.
[2] Mr Thompson has recently become aware of the non-notified variation decision, having previously made a submission opposing HWCP’s application for resource consents. Mr Thompson owns commercial property in Invercargill’s CBD. He maintains that the variation decision materially changed a key condition precedent to the grant of a resource consent permitting HWCP to carry out demolition work.
[3] Mr Thompson applies for an order prohibiting HWCP from undertaking demolition work in reliance on the resource consent until the determination of his application for judicial review of decisions made by a commissioner, on behalf of the Council, not to notify and to grant HWCP’s application to vary the condition in issue, or, alternatively, compliance with the original condition that formed part of the resource consent.1
[4] The application for interim relief was made without notice, however, service was effected on both respondents and the matter proceeded on a Pickwick basis. A telephone conference was convened on 30 December and counsel were provided with the opportunity to be heard. An on-notice hearing of Mr Thompson’s application before Gendall J was set down for 21 January 2020 in Christchurch. However, with demolition scheduled to begin early in the new year, the issue remains live.
[5] HWCP opposes Mr Thompson’s application. It submits that it would be inappropriate for orders to be granted either pending the on-notice hearing of the application or the substantive determination of the proceeding. The Council, while not formally abiding the Court’s decision, did not seek to be heard in relation to the application for interim orders.
Background
[6] HWCP was granted a resource consent on 4 June 2019 to demolish, alter, and redevelop land and buildings in the Invercargill CBD (the Development). The
1 Resource consent RMA/2011/148/A.
application was heard on a notified basis and attracted some 44 submissions, including from Mr Thompson.
[7] An issue raised by some submitters was the potential for buildings on the site to be demolished and for redevelopment to not immediately follow or to be delayed. This delayed development scenario is alleged to have been a concern expressed by submitters interested in the heritage value of the buildings that would be demolished, or who were concerned about the impact on the CBD and central city businesses if the site were to remain undeveloped. It was contended that such an outcome would significantly impact on the amenity of the CBD should the buildings be demolished and the block remain undeveloped. It was also argued that the presence of a large vacant block would detrimentally affect other businesses and business owners in the CBD.
[8] When the hearing commissioners appointed by the Council made their decision granting resource consents, they were made subject to various conditions. One of those conditions was condition 19, which required the consent holder to provide the Council with written confirmation from a registered trading bank that funding for stages 1-3 of the Development had been obtained before demolition of stages 1-4 and 6 could proceed. The condition read:
19. The consent holder must not undertake any demolition prior to providing the Council with written confirmation from a registered trading bank that funding from Stages 1 — 3 of the development as identified on the Staging Plan approved in Condition 1 has been obtained.
i.Upon providing such confirmation, the consent holder may demolish Stages 1 to 4 and 6, as identified on the Staging Plan approved in Condition 1, provided that Stages 1 to 3 must be built in one stage;
ii.Stages 4 and 6 may be built concurrently with or subsequent to Stages 1 — 3;
iii.The buildings located within Stage 5 of the Staging Plan approved in Condition 1, shall remain in place until such time as an agreement is entered into for the lease of a new building within Stage 5.
[9] In the consent decision, the commissioners noted that it was “crucially important” for the new Development to “diligently” follow demolition and that there was a need to manage the sequencing of development to ensure there was credible
evidence that redevelopment would promptly follow demolition. Condition 19 was viewed as going “a considerable distance in satisfying” those concerns.
[10] The consent decision was not appealed. However, on 5 November, HWCP applied to vary the resource consent conditions, including condition 19. That application was not notified. It was granted by a commissioner on 18 November. The condition(s) now reads:
19A. The consent holder must before commencing any demolition:
i.Provide the Council with written documentation demonstrating:
a. the consent holder’s commitment to develop Stages 1 — 3 as identified on the Staging Plan approved in Condition 1; and
b. the consent holder’s commitment to commence construction of Stages 1 — 3 within 9 months of demolition;
iiReceive written acceptance from Council that the Council is satisfied the documentation supplied under (i) provides credible evidence of a commitment to proceed with Stages 1 — 3 of the development. Council must assess this documentation within 10 working days of receipt. The assessment of credible evidence may include consideration of the progress towards; advancing the development and obtaining project funding; and entering into tenancy agreements.
19B. Upon receiving written acceptance of compliance with Condition 19A, the consent holder may demolish Stages 1 to 4 and 6, as identified on the Staging Plan approved in Condition 1, provided that Stages 1 to 3 must then be built in one stage and:
iStages 4 and 6 may be built concurrently with or after Stages 1 — 3;
iiThe buildings located within Stage 5 of the Staging Plan approved in Condition 1, must remain in place until an agreement is entered into for the lease of a new building within Stage 5.
[11] The varied condition no longer required HWCP to provide the Council with written confirmation from a registered trading bank that funding for stages 1-3 of the Development had been obtained before proceeding with demolition.
[12]The commissioner’s reasons for varying condition 19 were stated as:
[21]... Condition 19 was offered by the Applicant during the hearing. Its aim was to demonstrate that there was sufficient finance in place to complete stages 1 to 3 before demolition for obvious reasons. At that point the Applicant indicated that bank funding was imminent. However, compliance with this condition has proved difficult for a number of reasons:
(a)The Applicant will obtain funding from different sources, including the Provincial Growth Fund and from capital deployed by the Council.
(b)A trading bank will not provide an unqualified approval of lending. The approval will be nested in detailed banking requirements and, no doubt, will be subject to ongoing review. That is typical of commercial funding arrangements for developments of this type.
(c)The financial arrangements have significant commercial sensitivity.
[22]The Applicant’s amended condition promotes a different concept. That is that the Applicant provides information that credibly demonstrates the commitment of the consent holder to proceed with stages 1 to 3. The amendment identifies that evidence of the commitment could include such things as: building consent approvals, tenancy agreements to lease and project funding commitments or proposals. I have made amendments to Conditions 19(a) and (b) as proposed by the Applicant but with wording changes that still reflect the original concept. I accept the idea that the Council can make a reasonable judgment based on a range of information that is collectively sufficient to credibly demonstrate that the consent holder is in a position to complete stages 1 to 3. Once demolition proceeds then completion of condition stages 1 to 3 is a requirement of the consent.
[13] On 24 December, the Council confirmed that HWCP had satisfied all conditions necessary for demolition to commence. The demolition works are due to commence on or about 6 January 2020, although it is possible they may commence as early as 3 January.
The application for judicial review and interim orders
[14] Mr Thompson has applied to have the variation notification decision and the variation consent decision reviewed. In particular, he alleges that in making those decisions there was a failure to take into account relevant considerations, namely the
adverse effects sought to be controlled by condition 19 and the ineffectiveness of varied conditions 19A and 19B to control those effects.
[15] Further, that in making the variation consent decision the Council erred in law by unlawfully reserving a discretion to itself to determine whether there was “credible evidence” of HWCP’s commitment to develop stages 1-3 of the proposal, and that such a condition was so uncertain as to be unenforceable. Mr Thompson seeks orders setting aside the variation notification decision and the variation consent decision, and a direction that the Council reconsider those decisions.
[16] Pending the hearing of the review application, Mr Thompson seeks interim orders under s 15 of the Judicial Review Procedure Act 2016 and r 7.23 of the High Court Rules 2016 prohibiting the carrying out of any demolition works in relation to the Development in reliance on the resource consent.
[17]Section 15 of the Judicial Review Procedure Act provides as follows:
15 Interim orders
(1)At any time before the final determination of an application, the court may, on the application of a party, make an interim order of the kind specified in subsection (2) if, in its opinion, it is necessary to do so to preserve the position of the applicant.
(2)The interim orders referred to in subsection (1) are interim orders—
(a)prohibiting a respondent from taking any further action that is, or would be, consequential on the exercise of the statutory power:
(b)prohibiting or staying any proceedings, civil or criminal, in connection with any matter to which the application relates:
(c)declaring that any licence that has been revoked or suspended in the exercise of the statutory power, or that will expire by the passing of time before the final determination of the application, continues and, where necessary, that it be deemed to have continued in force.
...
(4)An order under subsection (2) or (3) may—
(a)be made subject to such terms and conditions as the court thinks fit; and
(b)be expressed to continue in force until the application is finally determined or until such other date, or the happening of such other event, as the court may specify.
[18] The Court may make an order under s 15 where it is reasonably necessary to do so to preserve the position of the applicant.2 If that statutory threshold is met, the Court has a wide discretion, taking into account all relevant circumstances, including the strength or weakness of the claim, the statutory framework, the public interest and the private and public repercussions of granting relief.3 The status quo, balance of convenience, and the overall justice of the position are all matters to be taken into account.4
Mr Thompson’s argument
[19] Mr Thompson seeks interim orders to prevent HWCP from undertaking demolition works in reliance on the resource consent until the determination of his substantive application for judicial review or until there is compliance with the original terms of condition 19 of the resource consent. Because of the need to avoid the potential adverse effects that would arise from the Development not proceeding or being delayed after demolition, he argues that such an order is necessary to preserve his position which will otherwise be irretrievably lost if demolition proceeds on 6 January without the lawfulness of the decision not to notify and to grant the variation being determined. If he is successful in his challenge any relief will be redundant in the face of the demolition having been completed.
[20] Mr Thompson maintains that both the pleadings and his affidavit establish at least an arguable case, and in his submission a strong case, for substantive relief from the claimed unlawfulness of the Council’s decision not to notify and to vary the consent conditions. In support of that argument, counsel for Mr Thompson, Ms Gepp, makes the following submissions:
2 Carlton & United Breweries Ltd v Minister of Customs [1986] 1 NZLR 423 (CA) at 430;
McGechan on Procedure (online ed, Thomson Reuters) at [JR15.02].
3 McGechan on Procedure, above n 2, at [JR15.02(2)(b)]; Carlton & United Breweries Ltd v Minister of Customs, above n 2, at 430.
4 Whale Watch Kaikoura Ltd v Transport Accident Investigation Commission [1997] 3 NZLR 55, [1997] NZAR 481 (HC); ENZA Ltd v Apple and Pear Export Permits Committee HC Wellington CP266/00, 18 December 2000 at [17], as cited in McGechan on Procedure, above n 2, at [JR15.02(2)(c)].
(a)The original application for resource consent was publicly notified.
(b)The risk of no or delayed development after demolition was a “live issue” at the hearing that was addressed both by the Council-appointed planning consultant’s report, in the evidence heard before the commissioners, and in their decision. It was described by the commissioners as a “crucially important issue”, and condition 19 was specifically designed to control those potential adverse effects.
(c)Mr Thompson did not exercise his right of appeal in reliance of condition 19 having been imposed.
(d)In deciding whether to vary the condition on a non-notified basis, the Council was required to take into account persons who were adversely affected by the change, or cancellation of the conditions, and in particular to consider every person who had made a submission on the original application who may be affected by the change. Ms Gepp argues that, on the face of the notification decision, minimal consideration was given to the position of submitters and whether the application made by HWCP to vary the consent conditions should have been notified. In particular, it is maintained that in deciding not to notify the application to vary the resource consent condition, the Council failed to take into account:
(i)The potential adverse effects of the no/delayed development scenario.
(ii)Whether the changed conditions would be effective in addressing those potential adverse effects.
(iii)Those persons who made a submission on the original application who might be affected by the change.
(iv)Whether special circumstances existed which justified public notification of the application to vary the resource consent condition. Special circumstances that it is argued should have been taken into account include the claimed significant financial uncertainty of the Development, the high degree of ratepayer and public interest, whether the Development was financially viable to ensure it would occur post-demolition, and the Council’s 50 per cent ownership of HWCP.
(e)The Commissioner in his variation decision observed that conditions 19A and 19B still reflected “the original concept” (of condition 19) and that the Council could make a “reasonable judgment” based on a range of information that would be collectively sufficient to credibly demonstrate that the consent holder is in a position to complete stages 1-3, noting that “once demolition proceeds then completion of condition stages 1-3 is a requirement of the consent”. However, Ms Gepp argues that the varied conditions are so uncertain as to be unenforceable. The term “commitment to the development”, as used in condition 19A, is described as vague, and one that relates to HWCP’s intentions rather than its capability to undertake the Development. Ms Gepp submits that it is apparent that the commissioner intended to require evidence that collectively demonstrated to the Council’s satisfaction that the consent holder will be in a position to complete stages 1-3, but that this is something different from what is now required by the amended conditions, namely credible evidence of a commitment to proceed.
(f)The varied conditions also unlawfully reserve a discretion to the consent authority. The Council is now required to exercise a discretion as to whether HWCP has produced “credible evidence of a commitment to proceed”, which is said not to be a standard that can be objectively determined.
(g)The alleged errors in the notification and variation decisions are material ones. Ms Gepp notes that demolition will not be incremental and will cover a large area in the core of the CBD. It is submitted that conditions 19A and 19B will be completely ineffective in controlling the potential adverse effects of no or delayed development post- demolition, and that they should not have been imposed in place of condition 19 without the input of affected business owners, ratepayers and other interested parties.
[21] In conclusion, Ms Gepp submits that there is strong public interest in whether the Development is adequately financially secure to ensure that construction will follow demolition, noting that HWCP is half owned by the Council and that it requires significant ratepayer funding. Counsel also draws attention to both the private and public repercussions of granting relief. Mr Thompson is said to have business interests that would be affected should there be no or delayed development after demolition, and it is further submitted that there will be public repercussions from such a scenario because of the effects on the amenity of the CBD and the loss of “historic heritage” in the absence of that being ameliorated by the positive effects of a redeveloped block. Taking all these factors into account, Ms Gepp submits an interim order should be made.
HWCP’s opposition
[22] HWCP opposes the making of any interim order. Mr Ormsby, who appears on its behalf, after being informed that the application can be fully heard on an on-notice basis on 21 January, acknowledges that some of the original concerns arising from the application are to some degree alleviated. However, he maintains his opposition and stresses the potential financial costs to HWCP from delaying demolition and the wider risks to the Development from ongoing delay.
[23] In summary, it is submitted on behalf of HWCP that Mr Thompson’s prime concern is simply a financial one, both in terms of the effect of the Development on ratepayers and on himself as a ratepayer and local landlord in the CBD. It is noted that Mr Thompson did not request the type of condition that was originally imposed
by the commissioners in the form of condition 19, only that no demolition should be allowed to occur until all resource and building consents had been granted. However, I understand Ms Gepp’s submission to be that what was proposed by Mr Thompson as a submitter was another means by which to gain assurance that construction of the Development would follow immediately after demolition.
[24] In relation to the variation of the conditions of the consent, it is emphasised that the commissioner concluded in his decision that the effects of making such a variation were minimal and that notification was not required because all that was achieved was an “improvement” to the condition’s reasonable operation and workability. In that regard, it is noted that compliance with condition 19 has proved difficult because of the multiple sources of funding that have been required to be obtained, including from the Provincial Growth Fund, and that a trading bank would not, as a matter of commercial practice, provide unqualified approval of lending. In that regard reference is made to a report prepared by a consultant planner, upon which the commissioner partially relied in making his decision to vary the condition. Of note is her finding that there are no adverse environmental effects of the change to condition 19 and that it will not, in her view, affect any persons who made a submission or may otherwise be affected by the change to the condition because, it is maintained, it achieves the same outcome as the previously approved condition.
[25] Reliance is also placed on the consultant planner’s recommendation to the Council that it accept that the amended condition had been met. Sources of funding that have been agreed to be provided are identified and a tenancy agreement with Farmers Ltd to be an anchor tenant, as well as other tenancies either signed or under negotiation, are noted. Reference is also made to detailed architectural design work for the buildings that comprise stages 1-3 that are nearing completion, and that the building consents for demolition, construction of a car park, and façade retention work have been obtained.
[26] HWCP seeks to place into issue the lateness of Mr Thompson’s application, which was only filed on 27 December. Mr Thompson claims that it was only on 23 December when he inquired of his solicitors about whether HWCP could proceed without having met the conditions of the resource consent that he was informed that
the changes to condition 19 had been made on a non-notified basis. This triggered further inquiries and correspondence with the respondents that ultimately resulted in him initiating his application and judicial review proceedings on 24 December. However, HWCP maintains that Mr Thompson had been keeping a close watch on the Development in the preceding months, and that it had been in the public domain as early as 1 October 2019 that a variation to the consent was being considered. That was a reference to comments made by the Council’s Chief Executive in an article in the local newspaper, although they are perhaps best described as oblique. In the absence of hearing more detailed evidence and possibly cross-examination, it is not appropriate nor necessary that I comment further.
[27] HWCP is critical of the extent to which Mr Thompson adequately informed the Court about his own personal business interests in the Development. He is described as a trade competitor of HWCP and that he stands to benefit significantly should the Development not proceed. This is because Mr Thompson is the managing director and 50 per cent shareholder, together with his wife, in a company that owns a commercial building in Invercargill which is currently tenanted by Farmers. As previously noted, if the Development proceeds, Farmers will vacate its present premises to take up an anchor tenancy in the new Development. HWCP alleges that Mr Thompson has an underlying motivation to retain Farmers as a tenant and an ulterior motive for bringing the current proceeding, which could potentially have consequences that may cause the Development to fail. Mr Thompson, for his part, maintains that he has other plans should Farmers vacate its present premises, and that his motivation in bringing the application is not to prevent the loss of Farmers as a tenant.
[28] Of most critical consideration is the potential detrimental impact on HWCP from the grant of interim orders preventing the commencement of demolition. HWCP purchased the land at a cost of approximately $14 million in anticipation of the Development. It has engaged a company to undertake the demolition work for a total contract sum of [...]. The weekly cost of delaying the demolition works has been approximated at $29,210.
[29] Also of note is the unconditional agreement to lease that HWCP has entered into with Farmers. I am advised there are strict timeframes that HWCP must comply with which will result in financial penalties to it if there are delays. There is also a sunset clause under the agreement to lease if HWCP does not deliver the premises on time, and that construction must commence by March 2020. Delay costs resulting from “holding costs” for tenants is approximated at [...] per month plus operating expenses, and delays may cause other prospective tenants’ interest in the Development, with whom HWCP is currently negotiating, to change. HWCP also suggests that should interim orders be granted, it could cause the collapse of the Development completely. However, I do not consider, in the context of the type of delay with which I am concerned (to a hearing on 21 January), that such a concern is realistic and I do not understand Mr Ormsby to be contending otherwise.
[30] Leaving to one side the contested legal issues concerning the application for interim relief, Mr Ormsby is particularly critical of the absence of evidence of any loss or detriment to Mr Thompson arising from the granting of the amended condition. In particular, the absence of evidence of the adverse effects on him as a result of a failure to properly notify him as an affected person under the Resource Management Act 1991. He is required to provide evidence of how the proposed change will result in adverse environmental effects to him, and what he seeks to have protected by way of substantive relief. Beyond the assertion that he considers himself to be an affected person who will suffer adverse environmental effects as a result of the varied condition, no evidence has been presented in support of his position to contradict either the commissioner’s assessment in that regard, or that of the consultant planner that the environmental effects of the variation to condition 19 were nil.
[31] Other considerations which HWCP puts forward to suggest that the balance of convenience rests with it include the fact that Mr Thompson did not appeal the original decision of the Council to grant the consent and that the review application does not question the Council’s decision to grant the consent but only the variations made to condition 19. It also emphasises that the Council is the relevant decisionmaker, not HWCP, yet it is the party that will be significantly affected. Any delay to the Development will cause significant financial loss to it and will slow the regeneration of the Invercargill CBD. Further, it is noted that the grant of interim orders could
result in the very thing that Mr Thompson maintains he is trying to prevent, namely the stalling or failure of the Development.
Decision
[32] In the circumstances, I do not intend to traverse in great detail HWCP’s opposition or to engage in the merits of the parties’ respective arguments, in light of the decision I have come to pending the on-notice hearing of the application before Gendall J on 21 January when the matter can be fully argued, aside from setting out, as I have, the basis of Mr Thompson’s case. It would not be appropriate for me to deliver a detailed judgment which indicates a view of the ultimate merits of the interim application, which to an extent has been overtaken by the fact that the issue can now be fully heard within a short timeframe. The weight of the respective arguments have accordingly been calibrated to take this important factor into account.
[33] I accept that Mr Thompson’s application for interim orders seeks to put on hold a development that is valued in excess of $100 million, and one in which HWCP has already incurred costs exceeding $20 million, and entered into binding lease agreements. The impact of granting the interim orders has the potential to have a disproportionate impact on HWCP. However, on the information currently available it is not apparent that delaying the demolition work for a little over two weeks realistically risks dire financial consequences. It is an aspect which the Court will be better placed to assess in greater detail, in the context of a potentially much greater delay, at a full hearing of the application.
[34] I am satisfied the statutory threshold of the reasonable necessity to preserve the position of Mr Thompson has, on balance, been established, at least until the merits of his application for interim orders can be heard in full on 21 January. His argument is that a condition of the consent that was to prevent or, at least, mitigate the adverse effects of there being no or delayed development after demolition has been unlawfully avoided. The purpose of the test of necessity to preserve the position of an applicant is to give protection on an interim basis to a person who may otherwise be unfairly prejudiced by reason of the delay in obtaining a final hearing of their substantive
claim.5 In the present context, the rationale is somewhat modified to whether Mr Thompson should be afforded protection on an interim basis by delaying demolition until his application for interim orders can be fully heard and determined.
[35] It is only on that basis that I consider it is necessary to preserve his position, lest the matter be prematurely decided without the benefit of full argument. Moreover, I accept that his challenge may be left redundant if he is not given the opportunity to be heard on his application for interim relief that in turn rests on his allegation that the Council has illegitimately allowed demolition to proceed without adequately protecting his and other ratepayers’ exposure to the potential impact of such an action without a sufficient guarantee or assurance of prompt redevelopment.
[36] I consider, in relation to the application for judicial review, that on the face of the information that is to hand, and mindful of the exigencies of the holiday period and the urgency of the application, that there is a “real contest between the parties and a reasonable chance of the applicant succeeding in that contest”.6 Insofar as the public and private repercussions of granting relief are concerned, both parties claim these support their respective cases. I consider a more accurate assessment should be able to be undertaken when the matter is the subject of full argument in January.
[37] Section 15(4)(a) of the Judicial Review Procedure Act provides that the Court may make an order subject to such terms and conditions as the Court thinks fit. While the provision does not require an undertaking as to damages, in appropriate cases that can be required, and in particular may be appropriate where there has been an exercise of a statutory power that is now challenged and other respondents’ activities affected by the grant of interim relief.7
[38] Initially, Mr Thompson did not provide an undertaking as to damages in support of his application. However, after the telephone conference, he advised that he was prepared to provide a limited undertaking to pay HWCP’s actual and
5 Woodhouse v Auckland City Council (1984) 1 PRNZ 6 (HC).
6 Esekielu v Attorney-General (1993) 6 PRNZ 309 (HC); Mahuta v Attorney-General HC Wellington CP67/99, 31 March 1999; Attorney-General v Mahuta CA71/99, 1 April 1999.
7 Montgomery v Attorney-General HC Auckland CP1445/86, 8 December 1986; Pfizer Inc v Director-General of Health (1989) 3 TCLR 30 (HC).
reasonable damages up to a maximum of $64,262 including GST. That is calculated on HWCP’s indicated weekly cost if demolition is delayed of $29,210, calculated over
2.2 weeks. Mr Thompson is not prepared to provide an undertaking as to damages with respect to any consequential losses that HWCP may incur because of what he considers to be the significant uncertainty as to both the likelihood and quantum of such loss.
[39] HWCP does not consider the undertaking to be sufficient. It considers that even a two week delay will remove “critical contingency time” and there could be consequential loss with knock on effects on agreements to lease, jeopardising the entire project. HWCP’s concerns in that regard have already been noted and, while I accept that the piecemeal eroding of the developer’s timelines could potentially corrode the viability of the project, I consider that for the purposes of assessing the consequences of a two week delay the offered undertaking as to damages assists the applicant’s argument.
[40] Having regard to Mr Thompson’s position, the necessity to preserve that position until his application for interim orders can be fully argued, and taking into account all the various factors that I have traversed, on balance, I consider the Court’s discretion favours the making of an order prohibiting HWCP from undertaking demolition works in reliance on resource consent RMA/2011/148/A until Mr Thompson’s application for interim orders can be heard and determined by Gendall J on 21 January 2020. That order is conditional on Mr Thompson providing an undertaking to pay HWCP’s actual and reasonable damages up to a maximum of
$64,262 including GST, representing as it does the indicated weekly cost to it from delaying demolition until 21 January 2020.
Costs
[41]Costs are reserved.
Further directions
[42] In preparation for the 21 January hearing that will proceed in the Christchurch High Court at 10 am, I direct counsel to file a joint memorandum agreeing an
appropriate timetable for any further preparatory steps that they consider are necessary. Absent agreement, application can be made to the vacation duty Judge. The joint memorandum is to be filed by 5 pm on 6 January.
[43] Because of the commercially sensitive nature of evidence contained in the affidavit of Mr Scott O’Donnell, at the request of HWCP there will be an order that the material contained in his affidavit is to be considered confidential. The affidavit is not to be searched without the permission of a Judge and is not to be published or utilised in any other manner or for any other purpose without further order of the Court.
[44] Counsel for HWCP requests that the Court redact any such confidential material, particularly of a financial nature, in its published decision that is not already in the public domain. I am prepared to accede to counsel’s request. However, to facilitate that step HWCP is to advise of any necessary redactions, if any. In the meantime, distribution of the judgment is limited to the parties.
Solicitors:
Hamish Fletcher Lawyers, Nelson for Applicant
Preston Russell Law, Invercargill for First RespondentSaunders Robinson Brown, Christchurch for Second Respondent
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