BROOKBY QUARRIES LIMITED V MANUKAU CITY COUNCIL HC AK CIV 2007-404-6082

BROOKBY QUARRIES LIMITED V MANUKAU CITY COUNCIL HC AK CIV 2007-404-6082 8 February 2008IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2007-404-6082IN THE MATTER OF an appeal under section 299 of the Resource Management Act 1991 BETWEEN BROOKBY QUARRIES LIMITED Appellant AND MANUKAU CITY COUNCIL Respondent Hearing: 4 February 2008 Counsel: R E Bartlett and J E Small for Appellant N D Wright for Respondent Judgment: 8 February 2008JUDGMENT OF HEATH JThis judgment was delivered by me on 8 February 2008 at 3.00pm pursuant to Rule540(4) of the High Court Rules. Registrar/Deputy RegistrarSolicitors: Burton & Co, Auckland Brookfields, Auckland Counsel: R Bartlett, AucklandIntroduction[1] Brookby Quarries Ltd (Brookby) appeals against a condition imposed by the Environment Court when that Court allowed its appeal from a decision of the Manukau City Council (the Council) declining to grant a resource consent in its favour. The appeal is scheduled for hearing during the week of 10 March 2008. [2] The Council applies to strike out the appeal in advance of a hearing. Regrettably, due to an administrative oversight, the original hearing for the application in November 2007 did not proceed. Given the proximity of the appeal hearing, a prompt decision is required on the present application.Application to strike out an appeal: legal principles[3] Applications to strike out appeals are rarely brought. Even more rarely do they succeed. That is because, in most cases, the issue on which a respondent seeks to persuade the Court that an appeal cannot succeed will be so intertwined with the substantive aspects of the appeal as to result in delay and waste of Court resources if unsuccessful. Nevertheless, there is jurisdiction to make an order of the type sought. [4] Mr Wright, for the Council, submits that the present appeal is futile. He submits that nothing could be gained by Brookby, even if it were successful on the appeal. If Mr Wright were correct, that would provide a basis to strike out an appeal: cf a similar application based on an appeal point being moot in Elders Pastoral Ltd v Bank of New Zealand [1990] 3 NZLR 129 (PC) and, in the context of an appeal under the Resource Management Act 1991 (the Act), Gisborne District Council v Eldamos Investments Ltd (High Court Gisborne, CIV 2005-485-1241, 26 October 2005, Harrison J).Background[5] Brookby operates a quarry business from a site in the western foothills of the Hunua Ranges. Brookby sought a resource consent to increase the number of truck movements to and from the quarry so that it could operate its quarry business more efficiently. Brookby appealed against the refusal of the consent sought for an increase in truck movement. [6] The appeal to the Environment Court gave rise to no fewer than four judgments. In those judgments, the Environment Court (Judge J A Smith, Commissioner Menzies and Commissioner Watson) dealt with different aspects of the appeal. Some understanding of the way in which the appeal unfolded is necessary to understand the point raised on the present application. [7] In its first judgment, issued on 22 November 2006, the Environment Court concluded that the resource consent ought to be granted. While indicating that the appeal was allowed, the Court sought further submissions on conditions to be attached to the consent, which allowed an increase in truck movements to a maximum of 36 trucks per hour each Monday to Friday from 7.30am to 5.30pm. [8] A joint memorandum submitted by counsel for the parties set out a number of agreed conditions for approval. In its second judgment, issued on 30 April 2007, the Environment Court directed that most of the conditions proposed by the parties ought to be included in Brookby's resource consent. [9] However, an issue remained in relation to what was proposed Condition 40. That concerned the financial contribution required from Brookby for road maintenance. The parties disagreed on the appropriateness of that condition. The Court included it in the conditions on which the resource consent was granted, but suspended its operation "pending a further determination of the Court in relation to the jurisdiction to impose and final form (if any) of that condition".[10] A third judgment was issued by the Court on 31 July 2007. This judgment addressed the issues surrounding proposed Condition 40. The Environment Court, having heard evidence, concluded that the proposed condition was unnecessary because the same type of financial contribution was addressed by Condition 35 which it had approved earlier. [11] The Environment Court's second decision had expressed Condition 35 in the following terms:35. Pursuant to section 128 of the Resource Management Act 1991 the conditions of this consent may be received [sic, reviewed] two years after the commencement of the consent (in accordance with Condition 3) and every three years thereafter for the purposes of considering the effectiveness of the consent conditions, particularly those associated with heavy vehicle movements, traffic and pedestrian safety, noise and vibration levels, the physical appearance of the quarry and maintenance of the character and amenity values of the local area and the efficient functioning of the community liaison committee. In response to the outcomes of monitoring, the Council may amend existing conditions or impose further conditions specifically including, but not limited to those relating to: Additional road upgrading work (i) The physical housing of the processing plant (ii) Further requirements for the monitoring of off-site noise and vibration levels by the consent holder (iii) Additional landscaping works.[12] As a result of the issues discussed in its third decision, the Court proposed an amendment to Condition 35 to reflect its observations and to clarify its intent. In paras [26] and [27] of its third judgment the Court said:[26] We conclude there is a need to tidy up conditions 35 and 39. As far as we can see, the only necessary change is to clarify condition 35 wording and to put a number before the additional works. We would be minded to add the words after additional works in condition 35: including the cost of rebuilding or resurfacing roads to a higher standand than would otherwise be necessary to maintain their service life of 25 years with one reseal.[27] We leave it to the parties whether this would serve any useful purpose given the terms of this decision. The parties are to file a memorandum (separately if they cannot agree on this issue) on the final wording of those conditions within 20 working days. We alsorequire a final Schedule 1. A full set of conditions as proposed should be filed for sealing with Schedule 1 attached. [The Court's emphasis][13] In submissions filed in the Environment Court as a result of the third judgment Mr Wright, for the Council, supported the proposed amendment to Condition 35. Mr Bartlett, for Brookby, did not answer the Court's question directly. Instead, he advised the Court, somewhat cryptically, that:Brookby does not propose nor consent to any variation to Condition 35.[14] In its fourth judgment, issued on 5 September 2007, Judge Smith referred to the memoranda filed by counsel and concluded that the Court had jurisdiction to finalise conditions of consent. The Judge expressed the view that Condition 35 was "clearly inadequately expressed" and "[to] that end, it is necessary that Condition 35 be clarified". [15] In a schedule to its fourth judgment Condition 35 was redrafted to read as follows:35. Pursuant to section 128 of the Resource Management Act 1991 the conditions of this consent may be reviewed two years after the commencement of the consent (in accordance with Condition 3) and every three years thereafter for the purposes of considering the effectiveness of the consent conditions, particularly those associated with heavy vehicle moments, traffic and pedestrian safety, noise and vibration levels, the physical appearance of the quarry and maintenance of the character and amenity values of the local area and the efficient functioning of the community liaison committee. In response to the outcomes of monitoring, the Council may amend existing conditions or impose further conditions specifically including, but not limited to those relating to:• Additional road upgrading work including the cost of rebuilding or resurfacing roads to a higher standard than would otherwise be necessary to maintain their service life of twenty-five years with one reseal;• The physical housing of the processing plant;• Further requirements for the monitoring of off-site noise and vibration levels by the consent holder;• Additional landscaping works.Competing submissions[16] Mr Wright submits that the re-drafting of Condition 35 did not effect any change to the meaning of the original condition. He submitted that the re-draft fully accorded with factual findings made by the Court in its third judgment against which Brookby has not sought to appeal. Mr Wright reminded me that an appeal lay only on a question of law and submitted that the findings in the third judgment were not susceptible to review in any event. [17] Mr Wright relied on the following passage (from the Court's third judgment) to support his submission that the redrafted condition reflected the way in which the Court, itself, had interpreted it:[13] However, the Court has reached the following factual conclusions as a result of having heard the evidence and cross-examination: (1) A properly constructed road can be designed and built to handle the increased number of ESAs on on these roads for a period of 25 years with one reseal. We note particularly that the actual heavy traffic on these roads is not significant by national standards and significantly lower than would be the case on a State Highway, for example; (2) That additional cost is specifically contemplated in condition 35. If that cost is incurred at an earlier date, then the recovery of that money can occur at that time. Given that the first review can occur in two years' time, no party suggested that that was not a reasonable time at which it could recover the extra capital costs for reconstruction; (3) Both experts agreed that the road would then have a design life of 25 years with the increased ESA movements. It would require one full reseal within that period, the same as any other road. In other words, the design and chip surface chosen for the road would be appropriate for the increased axle movements. It was also accepted that the increased cost of the reseal over the lower standard would also be an upgrading cost which could be sought in terms of condition 35; (4) We are satisfied that if the road is designed to the appropriate standard to handle the number of axles and with the appropriate seal it will require no more maintenance than any other road. It may even require less maintenance given that the increased pavement depth may mean it is less susceptible to water intrusion and potholing.[18] Mr Wright submitted that, in the absence of any basis to challenge the Court's reasoning, it did not matter whether Brookby was successful or unsuccessful on its present appeal. He submitted that Condition 35, even in its original form, stood to be interpreted in light of the Court's unchallenged reasons. On that basis, he submitted that it was futile for the appeal to proceed and that it should be struck out. [19] Mr Bartlett puts the substantive appeal, primarily, on an issue of jurisdiction. As I apprehend it, the principal ground of appeal is that, having determined the terms of Condition 35 in its second decision, it was not open to the Court to re-cast the condition in a subsequent judgment. [20] Mr Bartlett submitted that a successful appeal could yield advantages to Brookby and, if Condition 35 were left in its amended form, it could operate prejudicially. He pointed to three specific issues to support that submission: [21] First, Mr Bartlett referred to s 128(1)(a)(i) of the provision in the opening words of both iterations of condition 35. He submitted that the starting point for a review of the conditions could be altered by the re-framed condition in a manner prejudicial to Brookby. Section 128(1)(a)(i) provides:128 Circumstances when consent conditions can be reviewed(1) A consent authority may, in accordance with section 129, serve notice on a consent holder of its intention to review the conditions of a resource consent— (a) At any time or times specified for that purpose in the consent for any of the following purposes: (i) To deal with any adverse effect on the environment which may arise from the exercise of the consent and which it is appropriate to deal with at a later stage; or .[22] Second, Mr Bartlett submitted that the conditions went beyond the District Plan because, in dealing with the structure of a road the Plan makes no reference to a single re-seal in the way in which that term is used in the re-drafted conditions.[23] Third, Mr Bartlett submitted there was an undesirable uncertainty arising out of the computation of the time from which the 25 year period would run, in terms of the re-drafted condition. [24] Mr Bartlett also submitted that Condition 35 (in its amended form) created a requirement for maintenance of roads not constructed to an adequate standard which could not, as a matter of law, be the subject of a financial contribution pursuant to the District Plan, as the plan is silent on that issue.Analysis[25] The competing submissions reveal a narrow point for determination. The question is whether, even if Brookby were to succeed in persuading this Court that the Environment Court ought not to have re-drafted Condition 35 in its judgment, any meaningful relief could be granted. [26] Might there be a potential benefit in Brookby's favour? I deliberately use the word "potential" to allow for the possibility that the appeal might be allowed but the issue remitted to the Environment Court for further consideration. [27] In its third judgment, the Environment Court heard evidence and submissions on a condition proposed by the Council designed to provide for "an ongoing road maintenance contribution levied on the basis of tonnage". In issue was the proposed Condition 40 to which I have already referred. [28] Giving the judgment of the Environment Court, Judge Smith observed that Brookby had already agreed to make a "considerable capital payment towards the costs of upgrading certain roads (in the sum of $750,000)" and that Condition 35, in the terms agreed between the parties and recorded in the second judgment, also provided for changes to existing conditions that dealt with additional road upgrading work. [29] The Court referred to evidence on road costs as "long, convoluted and [referring] to numerous other documents for support". The Court considered thatthere appeared to have been a "clear misunderstanding by the Council as to what it included within terms of maintenance for the purposes" of Condition 40 hearing and what was intended by the term "upgrading works" falling within the ambit of Condition 35. [30] In making its factual findings on the proposed Condition 40 evidence, the Court can be seen as articulating the essence of the expert evidence and what would occur on particular underlying assumptions. For example, the Court, accepting expert evidence that the road would have a design life of 25 years with the increased movements, also found one full reseal would be required within that period. The Court concluded that there was no evidence to establish that the Council would need to recover costs by the tonne. At the end of para [14] of its third judgment, the Court said:If there was any doubt as to whether or not condition 35 covered those terms, that is a matter which could easily have been clarified given that it was already within the ambit of those conditions.As a matter of law the Court held that the payments to be made under Condition 35 mirrored those under the proposed Condition 40. [31] The Environment Court gave an opportunity to both parties to make submissions on any amendments to be made to Condition 35. That suggests that the Court was not wedded to the redraft as necessarily reflecting all of the evidence it had heard during the course of the appeal. [32] As indicated, perhaps unfortunately, counsel for Brookby responded rather cryptically to that request, leading the Court to redraft Condition 35 without the benefit of submissions from Mr Bartlett on any material differences that might arise from the wording the Court had proposed. That should not prevent an appeal but it could resonate in costs, depending on the outcome of the substantive appeal. The more crucial point is that, in the absence of submissions on the drafting, it is possible that the Court may have overlooked some material consequence of the redrafting. [33] Although there is much strength in Mr Wright's submission, I cannot (on a summary application to strike out) be confident that no benefit would result toBrookby if its appeal were allowed. Unless the lack of benefit were clear, the sparingly-exercised jurisdiction to strike out cannot be exercised.Consequential issues[34] On 9 October 2007, believing that the present application would be determined the following month, Asher J made directions to enable the appeal to be readied for hearing. There is a need to adjust those directions given the unexpected delay in resolving the present application. [35] I vacate the directions set out in paras [9]-[11] of Asher J's Minute of 9 October 2007 and, in lieu thereof, make the following directions: a) The appellant's submissions and a common bundle of documents shall be filed and served on or before 18 February 2008. The common bundle must contain the documents and follow the format set out in para [9] of Asher J's 9 October Minute. b) The respondent shall file and serve submissions in opposition to the appeal on or before 3 March 2008. c) A common bundle of authorities shall be prepared after filing of the respondent's submissions on 3 March 2008 and shall be filed on or before 6 March 2008. [36] The hearing of the appeal will proceed during the week of 10 March 2008 on a date to be fixed by the Registrar.Costs[37] The Council has been unsuccessful on its application. Ordinarily, that would entitle Brookby to costs. However, I decline to order costs at this stage. I reserve them pending determination of the appeal.[38] If, as I presently think, there is much to be said for Mr Wright's submissions, the Council, even though it has been unsuccessful on the present application, may want to ask the presiding Judge to consider whether to award increased costs to reflect the costs incurred on the present application. Costs have already been categorised on a 2B basis.Result[39] The application to strike out the appeal is dismissed. Costs are reserved. [40] I thank counsel for their assistance. __________________________ P R Heath J Delivered at 3.00pm on 8 February 2008