ARC V ROMAN CATHOLIC DIOCESE OF AUCK HC AK CIV 2007-404-002019

ARC V ROMAN CATHOLIC DIOCESE OF AUCK HC AK CIV 2007-404-002019 8 May 2008IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2007-404-002019UNDER the Resource Management Act 1991 IN THE MATTER OF an appeal against Environment Court decision W18/2007 under s299 of the Act BETWEEN AUCKLAND REGIONAL COUNCIL Appellant AND ROMAN CATHOLIC DIOCESE OF AUCKLAND Respondent AND FRANKLIN DISTRICT COUNCIL RUNCIMAN RURAL PROTECTION SOCIETY INC Interested Partys Hearing: 20 September 2007 and 23, 24 October 2007 Appearances: R B Enright and L S Fraser for Auckland Regional Council M Savage for Roman Catholic Diocese H J Ash and S H Smith for Franklin District Council P H Mulligan and J F Hayward for Runciman Rural Protection Society Judgment: 8 May 2008 at 2:30PM(RESERVED) JUDGMENT OF ANDREWS JThis judgment was delivered by me on 8 May 2008 at 2:30pmpursuant to r 540(4) of the High Court Rules. .. Registrar/Deputy RegistrarSolicitors: Kensington Swan, Private Bag 92101, Auckland Gault Mitchell Lawyers, PO Box 645, Wellington Simpson Grierson, Private Bag 92518, Wellesley St, Auckland Buddle Findlay, PO Box 1433, Shortland St, Auckland Counsel: M Savage, PO Box 5844, Wellesley St, AucklandIntroduction[1] The Roman Catholic Diocese ("the Diocese") proposes to build an integrated Secondary School (Years 7-13) on a site at 485 Burtt Road, Runciman, in the Franklin district ("the proposal"). It made an application to the Franklin District Council ("the FDC") for land use consent. The site was zoned "General Rural" under the operative Franklin District Plan ("the District Plan"). [2] The FDC initially refused consent. The Diocese filed an appeal in the Environment Court. Before the appeal was heard, the proposal was amended so that at the time of the hearing before the Environment Court in April 2004 ("the first hearing"), the FDC was prepared to grant consent and supported the appeal. However, the proposal was opposed by the Auckland Regional Council ("the ARC") and by the Runciman Rural Protection Society ("Runciman") and those parties carried the appeal. [3] In its decision issued on 29 July 2004 ("the first decision") the Environment Court upheld the FDC's consent to the amended proposal and disallowed the objections of ARC and Runciman. [4] ARC and Runciman then appealed to the High Court from the Environment Court decision. That appeal was allowed in the judgment of Courtney J delivered on 20 December 2005 1 ("the High Court judgment"). The High Court judgment focused on two "material errors" on the part of the Environment Court: a) The Environment Court's interpretation of the ARC's Regional Policy Statement ("the Policy Statement") and the interface between the Policy Statement and the District Plan; and b) Traffic conditions imposed by the Environment Court. [5] It was ordered at [58] of the High Court judgment that:1 Runciman Rural Protection Society Inc v Franklin District Council [2006] NZRMA 278The matter is remitted back to the Environment Court for fresh consideration.[6] The proposal was before the Environment Court again on 24 October 2006 ("the second hearing"). At para [108] of its decision delivered on 22 March 2008 ("the second decision") the Environment Court determined:In conformity with the High Court's direction, this Court has given these proceedings fresh consideration in the light of the High Court's corrections of errors of law. On that fresh consideration this Court: [a] Allows the appeal; [b] Cancels [the FDC's] decision refusing consent; [c] Grants resource consent for the proposal presented to this Court, subject to the amended conditions as detailed above imposed pursuant to s 108 [of the Resource Management Act 1991].[7] The ARC has appealed against the Environment Court's decision to allow the appeal against refusal of consent. Its appeal is supported by Runciman. The FDC and the Diocese appeared as respondents.Issues[8] The traffic conditions imposed in the second decision were not at issue. This appeal was concerned solely with the Environment Court's consideration of the District Plan and the Policy Statement and, in particular, with the Environment Court's consideration of the policies within the Policy Statement as to containment of urban growth within the "Metropolitan Urban Limits" (also referred to as "the Urban Fence"). [9] The questions for determination on this appeal may be stated as follows: a) Did the Environment Court err in finding that it did not have jurisdiction to consider any inconsistency between the Policy Statement and the District Plan on a resource consent hearing? b) Was the Environment Court required to consider changes to the Policy Statement and the District Plan that were notified between thefirst hearing on the consent and the second hearing, and if so, did it fail to do so? c) Did the Environment Court err by, in analysing the precedent and integrity effects of the proposal, applying the same analysis as it had in its first decision?The approach to be applied on a second appeal[10] This is a second appeal to the High Court. In his judgment in Waikanae Christian Holiday Park v Kapiti Coast District Council2 MacKenzie J observed at [8] that the approach to be followed on a second appeal is the same as that on a first appeal. The Court must approach the decision of the Environment Court having regard both to its original decision and to its subsequent decision on the matter referred back to it. The Court is not limited to examining the second decision and considering whether the directions have been followed. [11] The general approach to be adopted is as set down in Countdown Properties (Northland) Limited v Dunedin City Council3 at 153. Thus, the Court will interfere with decisions of the Environment Court only if it considers that the Environment Court has applied a wrong legal test, come to a conclusion without evidence or one which, on evidence it could not reasonably have come to, taken into account matters which it should not have taken into account, or failed to take into account matters which it should have taken into account. Further, any error of law must materially affect the result of the Environment's Court decision before the High Court should grant relief. With that approach in mind, I first set out relevant provisions of the Resource Management Act, the Policy Statement, and the District Plan, then turn to the first issue for consideration.2 Waikanae Christian Holiday Park v Kapiti Coast District Council HC WN CIV-2003-485-1764, 1774 and 1805 27 October 20043 Countdown Properties (Northland) Limited v Dunedin City Council [1994] NZRMA 145, Barker, Williamson and Fraser JJProvisions of the Resource Management Act, the Policy Statement and the District Plan relevant to this appeal.The Resource Management Act 1991 (the Act)[12] Section 75 (which is in Part 5 "Standards, Policy Statements and Plans") sets out what must be contained within a District Plan. Up until 10 August 2005, s 75(2) provided that a District Plan must give effect to any National Policy Statement or a New Zealand Coastal Policy Statement, and must not be inconsistent with: a) A Water Conservation Order; or b) The Regional Policy Statement; or c) A Regional Plan. [13] As from 10 August 2005, s 75(2) is divided into two and appears in the Act as ss 75(3) and 75(4). Section 75(3) provides that a District Plan must give effect to any National Policy Statement, any New Zealand Coastal Policy Statement, or any Regional Policy Statement. Section 75(4) provides that a District Plan must not be inconsistent with a Water Conservation Order or a Regional Plan. Counsel agreed that s 75(2), as it was prior to August 2005, is to be applied in this appeal. [14] Section 88A is in Part 6 "Resource Consents". It provides that any plan or proposed plan which exists when an application for resource consent is considered must be had regard to, in accordance with s 104(1)(b). [15] It is next necessary to refer to s 104, which is also in Part 6 of the Act. This provides that when considering an application for a resource consent and any submissions received, the Consent Authority (in this case, the Environment Court) must have regard to, among other things, any relevant provisions of a Regional Policy Statement or any proposed Regional Policy Statement (s 104(1)(b)(iii), and to any other matter the Consent Authority considers relevant and reasonably necessary to determine the application (s 104(1)(c)).The ARC Policy Statement[16] Clause 2.5 sets out the "strategic direction" for the Auckland region. The Court was referred, in particular, to the following "strategic objectives":2.5.1.3 To protect the soil resources, amenity values, rural character, landscape values and mineral resources of rural areas, from the Regionally significant effects of inappropriate subdivision, use or development; 2.5.1.6 To promote transport efficiency, and to encourage the efficient use of natural and physical resources, including urban land, infrastructure and energy resources.[17] The Court was also referred to clause 2.5.2 "Strategic Policies" and in particular to clause 2.5.2.3:Urban development is to be contained, within the Metropolitan Urban Limits shown on Map Series 1 and the limits of Rural and Coastal Settlements as defined, so that: (i) Expansion of urban activities outside the Metropolitan Urban Limits as defined and shown in the [Policy Statement] from time to time is not permitted; (ii) Environmental values protected by the Metropolitan Urban Limits and/or the limits of rural or coastal settlements are not adversely affected, and that the integrity of those limits is maintained.[18] In clause 2.6 "Regional Development", clause 2.6.1.2 "Policy: Urban Grown Management" provides:Urban development shall be contained within the defined limits (including the Metropolitan Urban Limits and the limits of rural and coastal settlements [19] Clause 2.6.2 "Methods" provides at 2.6.2.6:Provision shall be made in District Plans for urban development of Metropolitan Auckland to be contained within the Metropolitan Urban Limits shown on Map Series 1. [20] Clause 2.6.4 "Policy: Rural Areas" provides at 2.6.5.1 that ARC and Territorial Authorities will not make provisions in District Plans and Regional Plans which are inconsistent with policies.The Franklin District Plan[21] The Court was referred to Rule 23 of the District Plan Rules, which refers to rural zones. It sets out permitted, discretionary and non-complying activities. Schools and churches are listed in Rule 23.4 as discretionary activities in the rural zone. [22] The Court was also referred to Rule 53 "Assessment Criteria for Resource Consent Applications".Plan Changes[23] Three notified plan changes were referred to during the hearing of the appeal. These were Plan Change 6 to the Policy Statement and Plan Changes 14 and 20 to the District Plan. All three were notified after the first Environment Court hearing. [24] Plan Change 6 to the Policy Statement was notified on 31 March 2005. The Environment Court noted at [32] of the second decision that Plan Change 6 seeks to integrate the land transport and land use provisions of the Policy Statement and to make those provisions consistent with the Auckland Regional Growth Strategy, and confirms that the primary method of achieving the strategic direction is the administration of the Metropolitan Urban Limits. [25] The decisions version of Plan Change 14 to the District Plan was released in July 2006. It inserts new strategic objectives and a new definition of "rural character". The Court was also made aware of an FDC Resolution passed in August 2007 approving a further amendment to Plan Change 14, specifically requiring FDC to give effect to the ARC Policy Statement. [26] Plan Change 20 to the District Plan was notified on 31 March 2005. It inserts a new policy, to the effect that urban grown in Franklin's settlements should result in a compact, contained form to avoid spreading the effects of urbanisation over a greater area.The first issue: Interface between the Policy Statement and the District Plan[27] The first issue was whether the Environment Court erred in finding that it did not have jurisdiction to consider any inconsistency between the Policy Statement and the District Plan on a resource consent hearing.The Environment Court's consideration of Section 75(2) of the Act[28] At the time of the application, and the first hearing before the Environment Court, s 75(2) of the Act provided that a District Plan must not be inconsistent with the Regional Policy Statement. [29] The Environment Court's discussion of the "interface" between the District Plan and the Policy Statement is at [59]-[74] of its second decision. [30] At [61] it noted the observation (at [41] of the High Court judgment) that the proper construction of the Policy Statement and its interface with the District Plan is one factor to be considered under s 104 of the Act, which sets out matters to which a consent authority must have regard when considering an application for a resource consent. [31] At [67] of the second decision the Environment Court noted that it had not heard argument specifically on whether rr 23.4 (under which "Schools and Churches" are listed as discretionary activities in the Rural zone) and 53 (assessment criteria for resource consent applications) were inconsistent with the Policy Statement. [32] At [70] the Environment Court set out its understanding that the policies of the Policy Statement about activities within the Metropolitan Urban Limits are to be given regard to by a consent authority in considering a resource consent application for such an activity outside the Metropolitan Urban Limits. It went on to say that the provisions of the Policy Statement are one of a number of matters required to be considered under s 104 of the Act and, with the exception of Part 2 of the Act (to which all matters are made subject), all matters are of equal importance or weight.[33] At [71] the Environment Court accepted a submission from the Diocese that the ARC and Runciman were seeking to elevate the Policy Statement above all other matters set out in s 104(1) and went on to hold that while the Policy Statement is clearly relevant and important, it did not establish a threshold test to be applied to the exclusion of all else. Nor did it provide a hurdle to be overcome before the remaining matters in s 104 were considered. [34] At [74] the Environment Court stated that when approaching the s 104 and Part 2 analysis it would give substantial weight to the Policy Statement, and would bear in mind the matters the High Court had indicated were not relevant to its consideration of the Policy Statement. It concluded that it had no jurisdiction to consider the question of inconsistency between the Policy Statement and the District Plan on an application for resource consent. It also noted that if it had heard such argument, and had concluded that there was an inconsistency, it could do nothing except state its opinion as to the inconsistency. It did not have the power to decline the resource consent application on the basis of the inconsistency. [35] The ARC and Runciman submitted that they were not seeking to elevate the Policy Statement above all other matters to be considered under s 104, but also submitted that the Environment Court was wrong to find that it did not have jurisdiction to consider any inconsistency between the District Plan and the Policy Statement on a resource consent application. It was submitted that the Environment Court was entitled to do so under s 104(1) – the consideration of any inconsistency falls within the requirement to have regard to the provisions of a regional policy statement, and to any other matter that is "relevant and necessary". It was further submitted that the High Court had expressly directed the Environment Court to address the inconsistency. [36] The ARC and Runciman submitted that the Environment Court needed to determine whether s 75(2) applied and, if so, whether the District Plan merited less weight than the Policy Statement because of inconsistency between the two. [37] Against that, FDC and the Diocese submitted that the Court was correct to hold that it did not have jurisdiction to consider inconsistency under s 75(2) in thecontext of a resource consent application. This argument was based on the wording and context of s 75(2): s 75 refers to inconsistency between regional policy statements and district plans, and is in Part 5 of the Act, which is concerned with the preparation of District Plans, whereas resource consent applications are dealt with in Part 6. [38] FDC also submitted that Part 6 of the Act constitutes a code governing the making and determining of applications for resource consent. Counsel referred to the judgments of Randerson J in Springs Promotions Ltd v Springs Stadium Residents' Association Inc4 and Heath J in Videbeck v Auckland City Council5 where both Judges said that Part 6 of the Act is a code (described by Randerson J as a "complete code") governing the making and determination of applications for various types of resource consent. [39] The substance of the respondents' submissions was that the Environment Court was correct in saying that, in the context of a resource consent application, its jurisdiction was limited to noting the inconsistency, and taking that inconsistency into account when deciding what weight it would give to the District Plan and the Policy Statement in the course of the balancing exercise required under s 104. It was further submitted that this is what the Environment Court did.Discussion[40] In my judgment, the submissions for both the appellants and the respondents cloud the nub of this issue. The key part of the Environment Court's second decision in respect of s 75(2) is that it does not have jurisdiction to consider the inconsistency under s 75(2) in the context of a resource consent application. It is clear from the wording and context of s 75(2) that under s 75(2), the inconsistency is to be considered in the context of the preparation of (and submissions on) a district plan.4 Springs Promotions Ltd v Springs Stadium Residents' Association Inc [2006] 1 NZLR 846, at [61]5 Videbeck v Auckland City Council [2002] 3 NZLR 842, at [13][41] However, the Environment Court's finding in respect of s 75(2) in the second decision does not, in my judgment, equate to a finding that it had no jurisdiction to consider any inconsistency between the Policy Statement and the District Plan at all, or that it was unable, or unwilling, to consider the provisions of the Policy Statement as a factor under s 104. It specifically found at [61] of the second decision, that the interface between the Policy Statement and the District Plan was a factor to be considered under s 104. [42] This is, in my judgment, what was required of the Environment Court by [41] of the High Court judgment, where Courtney J observed that it was clear that: the proper construction of the [Policy Statement] and its interface with the district plan was inevitably significant in this case, albeit as one factor to be considered under s 104 of the Act. [43] At [75]-[82] of the second decision, the Environment Court considered the policies in the Policy Statement and, in particular, the containment of urban development. This was in the context of discussion of submissions on Plan integrity and precedent issues – whether granting approval to the Diocese's proposal would create an expectation of similar treatment for other activities seeking to locate outside the Metropolitan Urban Limits, and whether the District Plan's integrity would be threatened if an "acknowledged urban activity" was granted consent to establish outside the Metropolitan Urban Limits. [44] At [83]-[84] the Environment Court stated that the Policy Statement was strongly worded and to be given substantial weight. It was one of a number of matters to be considered. It stated that it took into account "the correct interpretation" of the Policy Statement. It considered that the "unusual qualities and substantial benefits" of the proposal meant that giving consent could not be viewed as an assault on the Policy Statement. [45] The Environment Court then went on to reconsider the proposal, taking the s 104 factors into account. At [87] it noted that, on the High Court's finding, the proposal was "prima facie not permitted by the policies in the Policy Statement", which were to be given substantial weight. It went on to say that the High Court judgment had not disturbed the "pre-eminent" test of sustainable management set outin s 5 of the Act (which provides that the purpose of the Act is to promote the sustainable management of natural and physical resources), qualified by s 7 (which sets out other matters to which all persons exercising functions and powers under the Act must have regard). At [88] it noted that the High Court had not disturbed its earlier findings on effects under s 5. [46] The Environment Court recognised the inconsistency between the policies in the Policy Statement and the District Plan. It noted that that inconsistency was one factor to be taken into account as part of its consideration under s 104. In my judgment it is clear from the paragraphs referred to above that the Environment Court did give consideration to the inconsistency. I do not accept the submission by Runciman that the Environment Court's consideration of the inconsistency was the "trappings" of a consideration, rather than the "substance". Having given consideration to the inconsistency, it concluded that the factor of inconsistency was outweighed by other factors.Conclusion[47] I am not persuaded that the Environment Court erred in its view of its jurisdiction in respect of s 75(2). In the context of a resource consent application the appropriate treatment of any inconsistency between a regional policy statement and a district plan is under s 104, as a factor to be given such weight as the Court thinks appropriate. I am satisfied that in the present case, the Environment Court did give appropriate consideration to the provisions of the Policy Statement as part of its s 104 consideration.The second issue: Changes to the District Plan[48] The second issue on appeal was whether the Environment Court was required to consider changes to the Policy Statement and District Plan that were notified between its first decision and the second hearing and, if so, whether it failed to do so. [49] This issue focuses on the interpretation of s 88A(2) of the Act. S88A provides:88A Description of type of activity to remain the same(1) Subsection (1A) applies if- (a) an application for a resource consent has been made under section 88; and (b) the type of activity (being controlled, restricted, discretionary, or non-complying) for which the application was made under section 88, or for which the activity is treated under section 77C, is altered after the application was first lodged as a result of- (i) a proposed plan being notified; or (ii) decision being made under clause 10(3) of Schedule 1; or (iii) otherwise. (1A) The application continues to be processed, considered, and decided as an application for the type of activity that it was for, or was treated as being for, at the time the application was first lodged. (2) Notwithstanding subsection (1), any plan or proposed plan which exists when the application is considered must be had regard to in accordance with section 104(1)(b). (3) [Not relevant][50] In the second hearing before the Environment Court, the ARC and Runciman argued that it should take into account Plan Change 6 to the Policy Statement, and Plan Changes 14 and 20 to the District Plan. It was submitted that the Environment Court was required to consider the relevant plan provisions as these stood at the time of hearing, even on a referral back from an appellate Court, and that the plan changes confirmed that the proposal was contrary to the future policy intent for rural parts of the Franklin District – in particular the strategic growth management principles applying to the region as a whole. [51] The ARC sought to have supplementary evidence admitted as to the changes to the Policy Statement and District Plan that had been notified since the first Environment Court hearing. [52] In the second decision the Environment Court undertook a careful consideration of its jurisdiction when one of its decisions is referred back by an appellate Court for reconsideration. Finding that the Act did not provide any guidance as to the scope of its jurisdiction, it turned for guidance to r 718A of theHigh Court Rules, which sets out the powers of the High Court on appeal. The High Court may "make any decision it thinks should have been made", direct the maker of the decision under appeal "to rehear the proceedings" or "to consider or determine any matters the Court directs", or "to enter judgment for any party". Further, the High Court may make any further or other order the Court thinks fit. [53] In the present case, the Environment Court concluded that the High Court had not directed it to rehear the proceedings, but rather to consider or determine any matters the Court directs. The Environment Court's conclusion came from the wording of the orders at [58] of the High Court judgment:The matter is remitted back to the Environment Court for fresh consideration.[54] The Environment Court noted at [25] of the second decision that, in remitting the matter back for fresh consideration, the High Court had not set aside or quashed the first decision, as had occurred in Waikanae Christian Holiday Park.6Accordingly, the scope of the second hearing before the Environment Court had to be confined to fresh consideration of the two matters that were at issue in the High Court, taking into account the corrections of law set out in the High Court judgment. Neither Plan Change 6 to the Policy Statement, nor Plan Changes 14 and 20 to the District Plan had formed part of the argument before the High Court, or the High Court judgment. [55] At [51] of the second decision the Environment Court concluded that, except to the extent required by the corrections of law given in the High Court judgment, it had no authority to alter any findings already made, and its fresh consideration of the matters referred back to it had to be confined to the evidence already received. Thus, it could not receive evidence as to the notified changes to the Policy Statement and District Plan. [56] The ARC acknowledged before me that Plan Change 6 to the Policy Statement was at too early a stage for it to be said that the Environment Court should have taken it into account. However, it submitted that the Environment Court should6 See fn 2have taken Plan Changes 14 and 20 to the District Plan into account on the referral back. It submitted that r 718A of the High Court Rules could not override the "plain meaning" of s 88A(2), which required the Environment Court, as consent authority, to consider the provisions of the District Plan as they were at the time the final decision is made on the application. The ARC argued that the statutory policy behind s 88A(2) is to ensure that the consent authority has regard to the most up-to- date planning instruments, so as to avoid the prospect of an application for rehearing. As it had before the Environment Court, the ARC submitted that the plan changes weighed heavily against the grant of resource consent for the proposal. [57] The FDC argued that s 88A(2) could not be read as granting a power to the Environment Court which was beyond the extent of the matters remitted to it by the High Court. It accepted that while there are policy reasons for the Environment Court having regard to the most up-to-date versions of planning instruments when considering a resource consent application de novo, there were also policy reasons which militated against having regard to plan changes notified between the first decision and the second hearing. Principally, these were the unfairness and inconsistency that would result if this single one of the s 104 factors was updated, while others were not.Discussion[58] I do not accept that the meaning of s 88A is "plain" in the situation of a reconsideration at the direction of the High Court. While it may be "plain" from s 88A that a consent authority must have regard to a "plan or proposed plan" when giving initial consideration to an application for resource consent, it is not "plain" that it is required to do so when giving "fresh consideration" to particular matters at the direction of an appellate Court. [59] The ARC submitted that Waikanae Christian Holiday Park supported its argument, in that the observation of MacKenzie J at [12] implied that there is a discretion to go beyond the confines of the direction of the High Court if consequential matters arise, or if there is a specific statutory duty to consider a particular matter:I consider that the Environment Court has not erred in law in adopting the approach that it did. While it quashed the whole decision, the decision of this Court was quite specific that reconsideration need involve only those aspects where the [High Court] had concluded that the [Environment Court] was in error. The approach of re-affirming its earlier decision, except for the matters required to be determined, was one which was open to it as a matter of law. [60] I cannot read the paragraph set out above in that way. In my judgment, the Judge's observation was that it was acceptable for the Environment Court to undertake a specific reconsideration limited to the aspects of the first decision in which it had been held to be in error. [61] The Environment Court's decision in Wilson & Anor v Selwyn District Council & Anor7 was also referred to in argument. There, the Environment Court concluded that it should consider the latest version of the relevant plan on a remission back. However, in that case it is significant that the High Court had vacated the Environment Court's first decision, and all parties had agreed that it was appropriate to consider the relevant plan in its current state. [62] I accept the submission by the FDC that s 88A(2) cannot be read as granting the Environment Court power to consider matters beyond the extent of those it has been directed to reconsider by the High Court, in the light of the High Court's identification of its errors of law. In this case the first decision of the Environment Court had not been quashed or vacated. The High Court directed the Environment Court to give fresh consideration to two specific matters of law. There was no agreement between the parties that plan changes notified after the first decision should be considered by the Environment Court in its second decision.Conclusion[63] In these circumstances, I find that the Environment Court was not in error in limiting its consideration to those two matters, on the evidence already received, and in not admitting evidence as to the notified plan changes.7 Wilson & Anor v Selwyn District Council & Anor EC CHCH C83/2005, 8 June 2005[64] In the light of the above finding, I am not required to consider whether the Environment Court failed to take the plan changes into account in its second decision.The third issue: The Environment Court's analysis of precedent and integrity effectsAlleged errors of law[65] It was submitted that the Environment Court erred in law in four respects: a) The ARC and Runciman submitted that the Environment Court erred in relying on its earlier, discredited interpretation of the Policy Statement; b) Runciman submitted that the Environment Court erred in suggesting that if a proposal involved less of an "urban" activity, then this would not create as significant a precedent; c) Runciman submitted that the Environment Court erred in relying only on factors that distinguish the proposal at a district level, rather than at a regional level; d) Runciman submitted that the Environment Court failed to give sufficient reasons for its finding that there would be no integrity effect. [66] For their part, the FDC and the Diocese submitted that the Environment Court had made no error of law in its analysis of precedent and integrity effects. Further, it was submitted that the matters raised by (in particular) Runciman were (although not expressed as such) matters relating to the weight placed by the Environment Court on the precedent and integrity issues, in its analysis under s 104. The weight to be placed on the individual factors is a matter for the Environment Court, and the High Court should not interfere.[67] As part of its analysis under s 104, a consent authority may consider precedent effects and the effect of granting consent on the integrity of planning instruments. The concern in relation to precedent is that the desire to treat like cases alike for reasons of consistency and fairness will lead to more consents being granted for non-complying activities in the future. 8 The concern in relation to integrity is that granting consent to non-complying activities will impair public confidence in the application of the plan's rules. 9[68] I agree, with respect, with the finding by Cooper J in Gould at [99], that precedent and integrity are not mandatory considerations under s 104. Cooper J said: I am not prepared to hold that the Environment Court erred in any way by "fusing its consideration of plan integrity and precedent (failing to separately consider each doctrine)" as the council alleges. Neither do I think that it was obliged to make a specific finding on plan integrity, or as to whether public confidence in the administration of the relevant planning instruments would be shaken or challenged, [69] In my judgment, it will be rare for the Environment Court's approach to precedent and integrity to amount to an error of law. [70] In this case, "precedent' and "integrity" have been dealt with as two separate issues. The distinction is not easily made. However, it is convenient in this judgment to deal first with the first three alleged errors, which relate more to "precedent" and then with the fourth, related to "integrity effect", as this is how they were addressed in counsel's submissions.Precedent effect[71] The Court of Appeal in Dye v Auckland Regional Council10 observed that the granting of a resource consent has no precedent effect in the strict sense – a consent authority is not formally bound by a previous decision of the same or another authority. The Court went on to say that:8 Dye v Auckland Regional Council [2002] 1 NZLR 337 at [32]9 Rodney District Council v Gould [2006] NZRMA 217 at [99]10 See fn 8, at [32]The most that can be said is that the granting of one consent may well have an influence on how another application should be dealt with. The extent of that influence will obviously depend on the extent of the similarities.The Environment Court's decisions[72] In the first decision, the Environment Court considered "precedent" at [158]- [159]. It noted a submission by the ARC that the proposal would create a precedent for similar developments in rural zones in the region, thus "additionally pushing the boundaries" of the Metropolitan Urban Limits. Having referred to Dye v Auckland Regional Council, the Environment Court then noted many schools that had established and operated for many years without being a precursor to urban development – although they had initially established in rural areas, and had gradually become surrounded by urban growth over the years, they were not recognised as being the catalyst for urban developments. It rejected the ARC's submission that the proposal would create a precedent for similar developments in rural zones throughout the region. 11[73] In the second decision, the Environment Court considered "precedent effect" at [75]-[81]. [74] At [77] the Environment Court noted that the District Plan's strategic direction for rural areas sought to sustainably manage the resources of the rural areas, and to avoid prematurely foreclosing options for accommodating the region's urban growth needs.[75] It recorded at [78] the evidence for the FDC that the "broad wording of the definition of urban development" in the Policy Statement meant that there was a variety of urban activities that fell within the definition, but were considerably different in nature from the proposed school, such as a substantial commercial complex, or a high or medium density residential development. The Court also observed that schools may have the characteristics of a rural environment, such as open space and amenity, which were not exhibited by other "obviously urban" activities such as warehouses or storage buildings.11 Environment Court first decision at [158][76] The Environment Court then recorded at [79] the evidence for the FDC as to Part 18 of the District Plan, which was described as being a comprehensive growth policy for the containment of urban development. [77] It noted at [80] that it had identified in its first decision that there was little land available in the Franklin district that would be suitable for a school of the size envisaged by the proposal. It also noted the specific requirements for schools, set by the Ministry of Education. [78] In relation to "precedent effect" the Environment Court concluded at [81] of the second decision:Thus there is no evidence to suggest there will be a domino effect from this proposal either in Franklin or in other Auckland Districts where schools are also discretionary activities. Any such effect would also have to relate to other discretionary activities in rural areas, which in turn would need to demonstrate that any adverse effects they could generate will be avoided, remedied or mitigated.Did the Environment Court rely on its earlier, discredited, interpretation of the Policy Statement?[79] This submission was expanded into two parts: a) A submission that the Environment Court could not adequately evaluate precedent effect if it had not properly interpreted the planning instrument relied upon to establish that effect; and b) A submission that the Environment Court did not address the correct question in relation to precedent – that is whether granting approval to the proposal would create an expectation of similar treatment for other activities seeking to establish outside the Metropolitan Urban Limits.(a) Did the Environment Court err in not properly interpreting the Policy Statement?[80] Both the ARC and Runciman submitted that the Environment Court's analysis in the second decision was flawed – logically, it could not adequatelyevaluate a precedent effect if it had not properly interpreted the planning instrument relied upon to establish that effect. [81] The Environment Court's error in interpreting the Policy Statement in its first decision was identified in the High Court judgment at [27] and [32]. The context of the High Court's conclusion as to the Environment Court's error is set at [20] of the High Court judgment, where it is noted that all parties had agreed that schools are a discretionary activity under the District Plan, and that the proposed school fell within the definition of "urban development" in the Policy Statement. However, the ARC opposed the proposal, arguing that as the development was "urban" in its implications and effects, it would be contrary to the objectives and policies of the Policy Statement, and should not, therefore, be permitted. [82] Courtney J noted that the Environment Court had held that the "wider context" of the Policy Statement indicated that it anticipated some (albeit limited) "urban-type activities" in rural areas. She then went on to consider the submission by the ARC and Runciman that the Policy Statement does not anticipate some urban activities in rural areas. [83] At [27] Courtney J held that the Environment Court had failed to recognise the fact that schools are inherently neither rural nor urban; the size and nature of the school must dictate that question, and to equate schools with urban activity generally was an error. Thus, the "mere fact" that schools are provided for in the District Plan was not an indicator that urban activities were contemplated in rural areas. [84] Courtney J then went on to consider the wording of the Policy Statement. At [32] she held that the intention of the Policy Statement was to contain urban activities within the Metropolitan Urban Limits, and that that is the context in which the words and phrases of the Policy Statement should have been viewed. [85] I can find in the second decision no support for the submission by the ARC and Runciman that the Environment Court applied an incorrect interpretation of the Policy Statement to its consideration of "precedent effect". It is apparent from its summary of the High Court judgment at [3] to [11] of the second decision that theEnvironment Court was conscious of the High Court's finding that the "consistent theme" of the Policy Statement is that urban development is to be confined within the Metropolitan Urban Limits. [86] In its discussion of "precedent effect" in its second decision, the Environment Court properly focused on the interpretation of the Policy Statement, as given in the High Court judgment. It noted the substantial weight to be given to the Policy Statement. It applied the High court's finding that that the "consistent theme" of the Policy Statement is to confine urban development within the Metropolitan Urban Limits. [87] The Environment Court did not, in my judgment, fall into the error identified in the High Court judgment of allowing itself to be distracted by consideration of "urban expansion" or "urban growth". Nor did it err by applying an analysis of the Policy Statement, which had been found by the High Court to have been wrong. I conclude that it did not err in its interpretation of the Policy Statement.(b) Did the Environment Court address the correct question in relation to precedent?[88] At [76] of the Environment Court's second decision it recorded a submission by the ARC that Dye v Auckland Regional Council12 , and the subsequent High Court judgments in Rodney District Council v Gould13 and Murphy v Rodney District Council14 confirmed that: precedent effect involves the degree of influence that the grant of approval to a proposal may have on future treatment of similar proposals, ie like cases are to be treated alike. It is suggested that the question that needs consideration is whether granting approval will create an expectation of similar treatment for other activities seeking to locate outside the [Metropolitan Urban Limits] in the region.[89] It is clear from [76] and [81] of the second decision that the Environment Court addressed the correct question in considering "precedent effect". At [76] it set out the correct test (as postulated by the ARC), and at [81] it applied that test, noting12 See fn 813 See fn 914 Murphy v Rodney District Council [2004] 3 NZLR 421that any application for consent would have to demonstrate that any adverse effects would be avoided, remedied, or mitigated. Thus other urban developments would not be allowed outside the Metropolitan Urban Limits simply because one had been. [90] I therefore conclude that the Environment Court did not err by relying on its earlier, discredited, interpretation of the Policy Statement.Did the Environment Court err in suggesting that if the proposal involved less of an "urban" activity, then this would not create as significant a precedent?[91] Runciman submitted that the Environment Court erred in law at [78] of its second decision in its discussion of the evidence for the FDC (referred to at [75], above). It was submitted that the Environment Court wrongly concluded that the Policy Statement supported a "graduated application" of the effect of urban development. [92] It was submitted that the Environment Court was then wrong to reason that because the definition of "urban development" in the Policy Statement is broad, it was required to determine to what extent some activities were "more urban than others" and would therefore have less potential to create an adverse precedent. This was submitted to be inconsistent with the "very clear and wide-ranging" nature of the Policy Statement's objective of ensuring that there are no urban activities outside the Metropolitan Urban Limits. The submission went so far as to say that the Policy Statement is a "redline control", which does not contemplate application of the policy commensurate with the perceived level of the "urbanisation" of the proposal. [93] I do not accept this submission. It amounts to a submission that the Policy Statement's policies on urban development govern the grant of a resource consent under the District Plan. That cannot be correct. As counsel for Runciman acknowledged, the Policy Statement is only one of the considerations to be taken into account in deciding whether to grant resource consent. It is not determinative. [94] Further, I do not accept that the Environment Court's analysis was as suggested by Runciman. The Environment Court acknowledged that the proposedschool is an urban development, but went on to hold that because of the specific characteristics of the proposal, no adverse precedent effect would arise. [95] Accordingly, I am not satisfied that the Environment Court has made an error of law as alleged.Did the Environment Court err in relying only on factors that distinguish the proposal at a district level, rather than at a regional level?[96] Runciman submitted that, as a matter of logic, the nature of factors that distinguish any given case from the policy must be commensurate with the level of the policy. Thus, it was submitted, when considering the "precedent effect" of a proposal against a provision in a district plan, it can be distinguished as "unusual" in the context of the district plan. However, when dealing with a regional policy, the unusual features must be "unusual" at a regional level. It submitted that the Environment Court had erred in applying and relying on factors that, at best, distinguished the proposal at district plan level only, and did not distinguish it at the regional level. [97] Runciman submitted that the Environment Court had, in essence, relied on two factors when deciding that the proposal would not create a precedent effect. These were, it was submitted, the specific site criteria for schools, and the status of schools as discretionary activities. It was submitted that neither was in fact a distinguishing feature at the regional level, as all schools have to meet the same criteria, and schools are discretionary activities in rural areas in other districts in the Auckland region. [98] Runciman's submission that the Environment Court "failed to consider precedent effect at the regional level" is not borne out by the wording of its second decision, in respect of either its submission as to site-specific criteria for schools, or its submission as to the status of schools as discretionary activities. [99] As noted above, at [81] the Environment Court concluded that there was no evidence to suggest there would be a "domino" (that is, precedent) effect from theproposal "either in Franklin or in other Auckland Districts where schools are also discretionary activities". The Environment Court clearly recognised that schools are discretionary activities in other districts in the region, but concluded there was no evidence to suggest that there would be a precedent effect either in Franklin or in other Auckland Districts; a conclusion "at the regional level". [100] The Environment Court then noted that "any [precedent] effect would also have to relate to other discretionary activities in rural areas". This is clearly a reference to discretionary activities other than schools. [101] I am satisfied that the Environment Court carried out its analysis in the manner Runciman submitted it was required to, notwithstanding that its conclusions are stated briefly. I am not satisfied that the Environment Court erred in this respect.Integrity effect: Did the Environment Court fail to give sufficient reasons for its finding that there would be no integrity effect?[102] Turning to "integrity", the Environment Court recorded at [82] of the second decision the submission by the ARC that granting consent to the proposal would threaten the integrity of the Policy Statement, "simply because an acknowledged urban activity would have been granted consent to establish outside the [Metropolitan Urban Limits]". [103] The Environment Court rejected that submission. At [83] it observed that the Policy Statement, while to be given substantial weight, was one of a number of matters to be considered. It considered that the proposal's:" unusual qualities and substantial benefits to the catchment it encompasses mean that granting consent to the proposal cannot be viewed as an assault on the [Policy Statement].[104] Runciman submitted that its criticisms of the Environment Court's approach to "precedent effect" also applied to its approach to "plan integrity". Runciman's submissions in respect of "precedent effect" have already been considered, and it is not necessary to repeat my conclusions in respect of them.[105] It was submitted that the Environment Court had made an independent error of law by failing to give any reasons for its finding that the proposal could not be viewed as an assault on the Policy Statement. Although referring to "unusual qualities and substantial benefits", it was submitted that the Environment Court had failed to spell out what those qualities and benefits were. [106] Runciman went on to submit that the need for reasons to be spelled out was particularly present in this case, because the potential to "damage the integrity of the [Policy Statement] was a primary issue in the [Environment Court's] s 104 analysis." In oral submissions counsel for Runciman submitted that detailed reasons were required because of the "offence against the Policy Statement". [107] Plainly, the Environment Court is required to give reasons for its findings. As Baragwanath J said in Murphy v Rodney District Council15 at [25]: failure to give reasons means that the lawfulness of what is done cannot be assessed by an appellate Court; and the duty to give reasons requires the decision maker to outline the intellectual route taken, which provides some protection against error. The reasons may be succinct; in some cases they will be evident without express reference.[108] In this case I accept the submission made by the FDC, that the Environment Court's comments on "integrity" in its second decision cannot be read in isolation from its overall conclusions as to the proposal set out at [88] of the second decision. [109] In my judgment, the reasons for the Environment Court's finding that the proposal had "unusual qualities and substantial benefits" are evident from within the second decision. I am not satisfied that the Court erred in law as alleged.15 See fn 14Further submission by Runciman: the "urban fence" policy is an appropriate basis for refusing consent to proposal outside the Metropolitan Urban Limits, because allowing development outside the "fence" can give rise to precedent and integrity issues.[110] Although not raised formally as an error of law, counsel for Runciman, in submissions, again referred to the "importance" of the Policy Statement (in particular, that in relation to Metropolitan Urban Limits) in the context of his submissions on "precedent" and "integrity effect". In particular, he referred to the judgments in Manos v Waitakere City Council16 and Stark v Auckland Regional Council17, where the High Court held that the ARC's "urban fence policy" (that is, the containment of urban activity within the Metropolitan Urban Limits) was an appropriate basis for refusing consent to proposals, because allowing development outside the "fence" could give rise to precedent and integrity issues. [111] This submission fails to recognise that both precedent and integrity effects must largely be based on the particular circumstances of an application. The High Court in Manos and Stark noted that allowing development outside the "urban fence"could give rise to precedent and integrity issues, not that it invariably would. It cannot be assumed that allowing any urban activity to establish outside the Metropolitan Urban Limits will automatically have adverse precedent and integrity effects. [112] The Environment Court's decision in Auckland Regional Council v Waitakere City Council (Shefco)18 cited by counsel for Runciman demonstrates that where there is a unique set of circumstances, allowing an urban activity to establish outside the Metropolitan Urban Limits may not generate an adverse precedent. A subsequent decision of the Environment Court cited in counsel's submissions,Batchelor v Tauranga District Council19 refers to the circumstances of a particular16 Manos v Waitakere City Council [1994] NZRMA 35317 Stark v Auckland Regional Council [1994] 3 NZLR 61418 Auckland Regional Council v Waitakere City Council EC AK A 169/05, 20 October 200519 Batchelor v Tauranga District Council (1992) 1 NZRMA 165case as having "some unusual quality", such that granting consent will not impair public confidence. [113] The submission also fails to recognise that, as noted earlier, counsel for Runciman acknowledged that the Policy Statement is only one of the factors to be considered under s 104. [114] Accordingly, Runciman's further submission does not provide grounds for allowing the appeal.Result[115] It follows that the appeal by the ARC, supported by Runciman, is dismissed. If the parties are unable to agree as to costs then memoranda are to be filed, those for the FDC and the Diocese within 21 days, and those for the ARC and Runciman within a further 21 days. Counsel are to indicate whether a hearing is required.__________________________Andrews J