GENERAL DISTRIBUTORS LTD V WAIPA DISTRICT COUNCIL AND ORS CA CA160/2009

GENERAL DISTRIBUTORS LTD V WAIPA DISTRICT COUNCIL AND ORS CA CA160/2009 27 May 2009IN THE COURT OF APPEAL OF NEW ZEALAND CA160/2009 [2009] NZCA 213BETWEEN GENERAL DISTRIBUTORS LIMITED Applicant AND WAIPA DISTRICT COUNCIL Respondent AND THE NATIONAL TRADING COMPANY OF NEW ZEALAND LIMITED First Section 301 Party AND BILIMAG HOLDINGS LIMITED Second Section 301 Party Hearing: 18 May 2009 Court: Glazebrook, O'Regan and Arnold JJ Counsel: N R W Davidson QC and C N Whata for Applicant P M Lang for Respondent D A Allan for First Section 301 Party L F Muldowney for Second Section 301 Party Judgment: 27 May 2009 at 2.30 pmJUDGMENT OF THE COURT A The application for leave to appeal is dismissed. B The applicant must pay each of the respondent and the first and second s 301 parties costs for a standard application on a Band A basis plus usual disbursements.REASONS OF THE COURT(Given by Arnold J)Background[1] The applicant, General Distributors Limited (GDL), a subsidiary of the supermarket operator Progressive Enterprises Limited, applies under s 308 of the Resource Management Act 1991 (RMA) for special leave to appeal against a decision of Wylie J: HC AK CIV 2008-404-4857 19 December 2008. In that decision, Wylie J dismissed GDL's appeal from a decision of the Environment Court upholding certain changes made by the respondent Council's Regulatory Committee to the Waipa District Plan: EC A 072/2008 8 June 2008. [2] The plan changes were initiated by the second s 301 party, Bilimag Holdings Limited (Bilimag), to permit a large format retail development to be known as the Bilimag Centre on a six hectare site a little over one kilometre from the Te Awamutu Town Centre. The first s 301 party, The National Trading Company of New Zealand Limited (National Trading), is the property-owning arm of Foodstuffs (Auckland) Limited, which operates Pak 'N' Save supermarkets. It is proposed that a Pak 'N' Save supermarket will be established at the Bilimag Centre. [3] Section 308 of the RMA incorporates s 144 of the Summary Proceedings Act 1957. Accordingly, leave to appeal may be granted only if there is a question of law in the appeal which "by reason of its general or public importance or for any other reason" ought to be determined by this Court. GDL sought leave from the High Court, but in a decision dated 25 February 2009 Wylie J refused its application.Basis of application[4] Before the Environment Court, GDL argued that that the plan change would significantly undermine the current objectives and policies of the District Plan by diluting its emphasis on the preservation of the Te Awamutu town centre. In particular, it would undermine the town centre's vitality, form and function. Anumber of objectives and policies of the District Plan were referred to, all of which sought to protect the town centre. It is sufficient that we refer simply to objective CO5 of the District Plan, which although introduced as part of the plan change, captures the essence of what GDL says the District Plan is attempting to achieve. CO5 sets out the following objective:To provide for commercial activities outside the Town Centre Zone where there are social and economic benefits for the community and where it can be demonstrated that any adverse effects on the environment of the town centre will be no more that minor. (Emphasis added.)[5] However, s 74(3) of the RMA provides that "[i]n preparing or changing any district plan, a territorial authority must not have regard to trade competition". Mr Davidson QC for GDL submitted that the interaction between the objective reflected in CO5 and the prohibition in s 74(3) raised an issue of general importance. He submitted that the Environment Court had held that it was precluded from having any regard to any effect of trade competition unless it was "significant in the sense of causing a serious decline in the viability of a town centre as a whole". This, he argued, was the wrong test. [6] Mr Davidson proposed the following question of law:Does s 74(3) preclude or restrict District Plan objectives and policies that seek to protect town centres from more than minor adverse effects of the dispersal of commercial activity so that more than minor means significant?[7] An alternative version of the question was advanced at an earlier stage:Does s 74(3) preclude local authorities from controlling the dispersal of commercial activity for the purpose of urban intensification of town centres unless that dispersal causes a serious decline in the viability of those centres as a whole or similar effect?Discussion[8] We are satisfied that leave to appeal should be refused, for the following reasons.[9] First, we consider that the question of the proper approach to s 74(3) has been authoritatively determined in Discount Brands Ltd v Westfield (New Zealand) Ltd[2005] 2 NZLR 597 (SC). At issue in that case was a consent authority's decision that a particular application should not be publicly notified. Section 94 of the RMA (as it then stood) provided that an application did not need to be notified if, among other things, the consent authority was satisfied that the effect on the environment of the relevant activity would be "minor". In considering this issue, the consent authority was obliged to bear in mind that the effects of trade competition were to be ignored (s 104(8) (now s 104(3)(a)) of the RMA). In discussing this aspect, Blanchard J said (at [120]):[S]ocial or economic effects must be "significant" before they can properly be regarded as beyond the effects ordinarily associated with trade competition on trade competitors.[10] Mr Davidson submitted that Blanchard J's observations were made in a different context and were, in any event, not binding as they were the Judge's observations rather than observations of the Court. He said that Elias CJ had expressed a different view. [11] These same points were advanced before Wylie J, who addressed them at [89] – [92] of his substantive judgment. We agree with the Judge that Blanchard J's dicta should be followed. [12] Second, we agree with Wylie J that the Environment Court adopted the correct approach. After referring to Blanchard J's judgment in Discount Brands, the Environment Court said:[66] By the term "significant" in the present context we take it to mean consequential upon or beyond effects ordinarily associated with trade competition on trade competitors. It is thus necessary for us to: (i) Determine whether there are any effects consequential upon or beyond effects ordinarily associated with trade competition on trade competitors; and then if there are: (ii) To then determine whether those effects are such that weighed in the balance with all other relevant matters the Plan Change should be approved.[13] So what is envisaged is a two-stage approach. The first step is to determine whether there are effects beyond those caused by trade competition. Before such effects can be found they must be "significant". The next step is to consider those effects against the requirements of the relevant planning objectives, which in the present case seek to protect the town centre. [14] As we have said, the requirement in CO5 that adverse effects on the town centre be "no more than minor" was introduced as part of the plan change. But even if we assume that it was operative at the time, or encapsulated the effect of the District Plan in relation to the town centre, the Environment Court did address it. At [105] – [140] of its decision the Environment Court considered the question "whether the Bilimag Centre will have a more than minor effect on the Town Centre". Having analysed the evidence and submissions at length, the Environment Court concluded that "the distributional effects, if any, will have no effect on the Town Centre other than what could be expected by normal trade competition" (at [141]). It then reiterated its view in the summary which followed (at [142](iv)). [15] So the Environment Court did consider the question that Mr Davidson said it should consider (whether or not the effects were more than minor) and concluded that there would be no adverse effects (i.e. whether minor or more than minor). That finding means that whatever answer is given to the question of law identified, it will not affect the outcome of this case. This alone would justify refusing leave.Decision[16] Leave to appeal is declined. The applicant must pay each of the respondent and the first and second s 301 parties costs for a standard application on a Band A basis plus usual disbursements.Solicitors: Russell McVeagh, Auckland for Applicant Swarbrick Dixon, Hamilton for Respondent Ellis Gould, Auckland for First Section 301 Party Tompkins Wake, Hamilton for Second Section 301 Party