ROYAL FOREST AND BIRD PROTECTION SOCIETY OF NEW ZEALAND INCORPORATED V KAPITI COAST DISTRICT COUNCIL AND ANOR HC WN CIV 2007-485-635

ROYAL FOREST AND BIRD PROTECTION SOCIETY OF NEW ZEALAND INCORPORATED V KAPITI COAST DISTRICT COUNCIL AND ANOR HC WN CIV 2007-485-635 30 July 2007IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV 2007-485-635UNDER the Judicature Amendment Act 1972 IN THE MATTER OF an application for review of a decision dated 7 September 2006 by the First Defendant under sections 93 and 94 of the Resource Management Act 1991 not to publicly notify or serve notice of resource consent application BETWEEN ROYAL FOREST AND BIRD PROTECTION SOCIETY OF NEW ZEALAND INCORPORATED Plaintiff AND KAPITI COAST DISTRICT COUNCIL First Defendant AND KOTUKU PARKS LIMITED Second Defendant Hearing: 24 July 2007 Appearances: Mr P Beverley and Mr J Opie for Plaintiff No appearance for First Defendant (abides decision of Court) Mr J S Kós QC for Second Defendant Judgment: 30 July 2007 at 10.30 amJUDGMENT OF MALLON J Introduction[1] This is an application for interim orders that would prevent earthworks from being undertaken pending determination of the substantive proceeding. In the substantive proceeding the plaintiff has applied for judicial review of a decision of the first defendant ("the Council") made under the Resource Management Act 1991 ("the RMA"). That decision was that an application for resource consent made bythe second defendant ("Kotuku") would not be notified. The plaintiff contends that the Council's decision not to notify Kotuku's application was unlawful. [2] Kotuku's application was for a proposed subdivision of a site ("the site") and related earthworks. The plaintiff contends that the robust and public process that would follow if the application proceeded on a notified basis is necessary to enable the Council to reach an informed decision as to what form of development, if any, is suitable for this site. [3] The plaintiff's particular concerns about the proposed subdivision and earthworks are twofold. First, the subdivision is adjacent to the Waikanae Estuary Scientific Reserve ("the Estuary"). The Department of Conservation ("DOC") is responsible for the Estuary which is a significant habitat of indigenous fauna. The plaintiff considers that the Council had insufficient information to be satisfied that the development adequately mitigated the impact it would have on the fauna in the Estuary. Secondly, the subdivision site is on a natural sand dune landform that will be irreparably altered by the development. The earthworks will significantly alter the natural character, and have an impact on the ecology, of the sand dunes on the site. [4] The substantive proceeding has been set down for 20 September 2007. The interim orders are sought to preserve the position pending that hearing. They are sought because of the second of the plaintiff's two concerns. Kotuku is ready to proceed with the earthworks and has only withheld commencing those works pending this Court's decision on the plaintiff's interim orders application. [5] Kotuku's position is that it would be willing to undertake not to carry out the proposed earthworks pending the substantive hearing providing the plaintiff provides a suitable undertaking as to damages. The plaintiff is not prepared to provide that undertaking. That is not because it does not have access to funds that would enable it to meet any such undertaking. Rather it is because the plaintiff considers that as a not-for-profit body representing the public interest it should not be required to give that undertaking. The issue is, therefore, whether an undertaking as to damages should be required as a condition of interim orders providing I am satisfied that the interim orders should otherwise be granted.Statutory regime[6] Resource consent applications are to proceed on a notified basis unless the requirements set out in ss 93 and 94 of the RMA are satisfied. [7] In this case the Council was required to publicly notify Kotuku's application unless it was "satisfied" that the adverse effects of the activity on the environment would be "minor" (s 93 of the RMA). Further, even if the authority was so satisfied, the Council was required to serve notice of Kotuku's application "on all persons who, in the opinion of the [Council], may be adversely affected by the activity" (s 94(1) of the RMA). However, notice to adversely affected persons was not required if all persons who might be adversely affected by the activity had given their written approval to the Council (s 94(2) of the RMA). [8] The decision not to notify an application for resource consent has significant consequences because it deprives parties of the right to participate in the determination of the application and the ability to refer matters to the Environment Court: Discount Brands Limited v Westfield (New Zealand) Ltd [2005] 2 NZLR 597 at [21]. It has been said that the Council must be clear that notification would not illicit information or perspective that would cause it to view the effects of the activity as more than minor: Discount Brands Limited at [25]. The information before the Council must be adequate for it to understand the activity and assess the magnitude of any adverse effect on the environment: Discount Brands at [114]. [9] The Supreme Court has held that persons "adversely affected" under s 94 are limited to persons with property rights or interests who might suffer direct environmental effects: Discount Brands. Since that decision s 94 was amended. The scope of the revised wording was discussed in Northcote Mainstreet Inc v North Shore City Council [2006] NZRMA 132 at [185] to [189].Background[10] The proposed subdivision on the site is stage four of the Kotuku Parks subdivision development. Kotuku has been undertaking the Kotuku Park development over the past 18 years. [11] Kotuku's original proposal for stage four was to develop the site into 31 lots on 3.2 hectares ("the original proposal"). The original proposal also included moving up to 75,000 m 3 of material from two areas of land to the east of the site so as to build up the ground level on the site. [12] In 1998 Kotuku applied for and was granted consent for the original proposal. The consent was subject to a number of conditions. An appeal was made to the Environment Court. Kotuku challenged some of the conditions imposed, while the local iwi, Kapiti Environmental Action Inc. ("KEA") and the Waikanae Estuary Guardians ("the Guardians") sought to overturn the decision to grant consent or to modify that consent. The Minister of Conservation took part in the appeal to the extent of opposing Kotuku's appeal on the conditions. The plaintiff took part in the appeal hearing in support of the appeals by KEA and the Guardians. [13] In its judgment dated 13 June 2000 the Environment Court overturned the Council's decision. The Court said that the loss of the natural character of the sand dune landform would conflict with s 6(a) of the RMA. It said that the exposure of the adjacent significant habitat for indigenous birds (in the Estuary area) would conflict with s 6(c) of the RMA. In addition there was an adverse visual effect and a duty to have regard to the hindrance which the development would place on the exercise of Kaitiakitanga. Overall the Court concluded that the original proposal was too intensive and would have effects on the environment that would be too great. [14] The Environment Court said that its decision did not mean that no residential use of the site should be permitted. Its decision was without prejudice to a further application in respect of a different proposal.[15] After the Environment Court decision Kotuku worked on an amended proposal. It employed Frank Boffa of Boffa Miskell (landscape architects) to assist in this work. Mr Boffa had given evidence at the Environment Court appeal opposing the original proposal. In that evidence he said "[i]n terms of coastal subdivision in a sensitive environment I have rarely experienced anything so insensitive than what is currently proposed". [16] Following this further work in 2004 Kotuku applied to the Council for resource consent to subdivide a smaller area (2.1 hectares) of the site into 10 allotments ("the revised proposal"). The revised proposal required earthworks in the order of 13,000m 3 of cut and fill (substantially less than the 75,000m 3 in the original proposal). [17] Kotuku met the Council, DOC and other groups to discuss the revised proposal. The Council recommended that it consult with iwi, KEA, the plaintiff, the Guardians and the Otaihanga Residents Association (who had all taken part in the Environment Court appeal) as well as the owners of the four neighbouring properties. Kotuku held a question and answer meeting with these parties, DOC and the Council on 1 November 2005. A site meeting also took place on 14 November 2005 attended by interest groups including the plaintiff. [18] As a result of the consultation Kotuku agreed to put in place a number of mitigation measures. Following this Kotuku received written consent from the immediate neighbours to the site including DOC. It also received written consent from KEA, the Otaihanga Resident's Association and the local iwi. It did not receive written consent from the plaintiff, nor from the Guardians. (In addition the plaintiff understands that the Council received notice from the Friends of the Waikanae River that it was opposed to the revised proposal). [19] On 7 September 2006 the Council decided that the application could proceed on a non-notified basis. The reasons for that decision are set out in a report ("the Report"). In relation to s 93 of the RMA the Council concluded:"Although the earthworks exceed the permitted standards and will change the present location by creating roads and building platforms, it is consideredthat the works will enable residential subdivision within the scale and intensity intended by the District Plan for the Residential Zone. It is considered that the adverse effects of the earthworks will be no more than minor".[20] In relation to s 94 of the RMA the Council referred to the parties that had given consent and concluded:"There are no other parties considered to be adversely affected by the development of this residentially zoned site".[21] On 25 September 2006 the first defendant granted resource consent for the development. The application indicated that "the earthworks and other development on the site will not occur for approximately five years". However, there was no condition in the consent as to timing and Kotuku now wishes to and is ready to commence the earthworks now. The earthworks will take two weeks to complete. [22] On 27 March 2007 the plaintiff issued its substantive proceeding. Between March 2007 and June 2007 there was discussion between the solicitors for the plaintiff and Kotuku about whether interim orders would be sought. As early as 27 April 2007 Kotuku advised that its preferred time for the earthworks was in the winter of 2007 and no undertaking would be given to discontinue work on the subdivision. An interim orders application was not made until 5 July 2007.The necessity to preserve the plaintiff's position[23] There is no position to preserve if the substantive claim is not arguable. In the substantive proceeding the plaintiff contends that the Council erred in finding that the effects of the revised proposal would be minor. It also contends that the Council erred in not giving notice to it as a person who may be "adversely affected" by the development. It says that the Council made an error of law, failed to take into account relevant considerations, acted unfairly, acted unreasonably and based its decision on a material mistake of fact. It seeks an order quashing the Council's decision not to notify Kotuku's application and an order requiring that notice be given.[24] In relation to the proposed earthworks the plaintiff's view is that they will significantly alter the sand dunes on the site and have an impact on their ecology. Once the earthworks have been carried out the land on the site cannot be put back to its natural state. The substantive proceeding if successful provides the plaintiff with the opportunity to challenge the decision that will allow the sand dunes to be significantly altered. If the earthworks are undertaken, an important part of its case is rendered nugatory. [25] Kotuku says that there is no position to be preserved. It says that there are no seriously arguable issues raised in the proceeding, and that even if the plaintiff was successful the Council would be required only to notify the application. It says that for a number of reasons it is extremely unlikely that the Council would not confirm the consent already given. [26] On the basis of the information before me, and in light of the necessary limited traversing of the substantive issues in the context of an urgent interim application, I am not able to say that there is no position to preserve on the substantive claim. To preserve the plaintiff's position on the substantive claim interim orders are necessary in the absence of an agreement between the plaintiff and Kotuku which would delay the earthworks until the substantive proceeding.Discretionary factorsStrength of the substantive case[27] In relation to s 93 the plaintiff's case is that the Council based its decision on inadequate information. It says that this is apparent from the Report. It says that the Council based its decision on a review of the Environment Court decision, but did not have the benefit of expert assistance as to whether the revised proposal addressed the issues identified by the Environment Court. Further, it says that the report dismissed the earthworks effects as "temporary" without discussion of the effects of the works on the natural character of the sand dunes. It also says there was no analysis of whether there was any new relevant information arising between the Environment Court decision and the decision not to notify.[28] In relation to s 94 the plaintiff says that the law is uncertain as to whether it is an "affected" person. The plaintiff will submit at the substantive proceeding that it is an affected person. The plaintiff further submits that the report made a mistake of fact in stating:"Protracted discussions and negotiations have been undertaken with the parties to the Environment Court appeal resulting in their eventual agreement to the proposal now under consideration".[29] In fact, neither the plaintiff nor the Guardians had agreed to the revised proposal and both of these parties were parties to the Environment Court appeal. [30] Kotuku submits that the plaintiff's case is weak. Amongst other things it points to the substantial modifications to the proposal, the significant consultation it engaged in and the consent it has received from all affected persons, including DOC, KEA and iwi. It takes a different view on the meaning of "affected" persons than does the plaintiff. It says that the plaintiff was not an affected person within the meaning of s 94 of the RMA. [31] I am not in a position to determine on this interim application the strength of the substantive proceeding other than to say the plaintiff has raised an argument which has not been shown to be completely untenable. Although the alleged lack of strength in the plaintiff's position was raised by Kotuku, neither Mr Kós nor Mr Beverley dealt with the substantive issues in any detail. I treat this factor as pointing neither in favour nor against the making of the interim orders.Public interest versus private costs[32] The plaintiff submits that the interim orders will preserve the position for what is a short period between now and the substantive proceeding. It says that the public interest warrants the interim orders being made without an undertaking as to damages being required. It is not the position that if an undertaking were given it could not be met. Rather the plaintiff says that it has already taken on the costs of the proceeding in the public interest, and its limited resources should not beburdened with a requirement to pay damages to Kotuku if it is ultimately unsuccessful in its substantive proceeding. [33] Kotuku says that an undertaking as to damages should be given. It says that if the interim orders are granted it will suffer direct costs. This is because it is ready to market a neighbouring subdivision (stage nine). As part of that marketing Kotuku intends to level an adjacent playing field. Although it is required to level the playing field there is no set time for this must happen. However Kotuku wants this levelling to have occurred at the time of marketing stage nine (it envisages a premium from sections adjacent to a landscaped field). The sand from that playing field will be used to fill the site for the stage four development. [34] If Kotuku is restrained from carrying out the earthworks Kotuku has three options. They are: a) To delay marketing stage nine until after the substantive hearing. It would be difficult to calculate its loss from delaying the marketing of stage nine. Kotuku did not provide any details about its proposed marketing. b) To continue with the planned marketing of stage nine and the levelling of the neighbouring playing field. The sand from the playing field would be stored on another nearby area of the Kotuku Parks subdivision (stage seven). To store the sand on stage seven Kotuku would need a consent from the Council. Under this option there would be costs in the double handling of the sand in moving it from stage nine to stage seven and then subsequently moving the sand from stage seven to stage four. The costs of this double handling have not been calculated. (Kotuku refers to this option having the potential to cause increased disturbance to residents, but this is somewhat vague – see similar comments at [40] below). c) At the time of developing stage four to obtain sand from an alternative source. The costs of this have been estimated as up to $80,000. Thereis no supporting material as to how this sum has been calculated. Kotuku said that under this option it would need to negotiate with the Council to keep the playing field at its current level. (An alternative might be to continue with the levelling of the neighbouring playing field and to dispose of the sand from that levelling in some other way). [35] However, Kotuku accepts it has an obligation to mitigate its costs. It says that if an undertaking as to damages were given it would accept an undertaking for any direct costs it incurs capped at $80,000. I note that if it pursued the third option it would need to show that this was reasonable. It would not be reasonable if it was not in fact in a position to market stage nine or if option (b) was a reasonable, practical and lesser cost alternative. [36] Both parties accept that an undertaking as to damages is not always required in an application for interim orders: see Te Waka He Ika o Te Arawa v Treaty of Waitangi Fisheries Commission HC AK CP 395/93 31 March 1999 Anderson J (see also Aley v North Short City Council [1998] NZRMA 206 where an interim order was urgent and it was simply not practical to obtain an undertaking in the time available given the number of plaintiffs involved). Fiscal or other barriers should not be put in the way of important public issues. [37] It is apparent that whichever option open to Kotuku is the appropriate one for Kotuku to pursue, the costs to Kotuku are not high. It is also apparent that the plaintiff has the financial resources to meet a claim for damages of up to $80,000 (if option (b) is not a reasonable and practical lesser cost alternative). Although Mr Beverley advised that the plaintiff's annual subscriptions do not meet its current annual expenditure the plaintiff does have other resources in addition to subscriptions. Its annual accounts show that it has assets in excess of $5 million, over $2.6 million of which are current assets. [38] I also note that others representing the public interest have taken a different view from the plaintiff. This includes DOC. That is not to say that the plaintiff will be unsuccessful in the substantive proceeding. Mr Beverley referred to a previousexample where a public interest body succeeded in a case where DOC had not taken issue with what was proposed. However it is relevant that the public interest has not been unrepresented to date. It seems to me that if the plaintiff wishes to pursue the matter and restrain Kotuku where that will impose costs on Kotuku it is not unreasonable for the plaintiff to bear those costs. [39] The fact that a delay will impose costs on Kotuku, the plaintiff's ability to meet an undertaking (which will be a relatively modest one), and that other bodies have at least to some extent already represented the public interest, are factors that point in favour of an undertaking as to damages being appropriate.Inconvenience to others[40] Kotuku says that a further reason as to why it wishes to carry out the earthworks now is to minimise disruption to residents in the area. Winter is the most desirable time to move sand because it is typically less windy than the spring months. This inconvenience is too vague and speculative for me to place any weight on it.Delay[41] The resource consent was granted in September 2006. The substantive proceeding was filed in March 2007. The interim orders were sought in July 2007. I accept that the plaintiff delayed both in bringing the substantive proceeding and in seeking its interim orders application. [42] There is no prejudice to Kotuku from the delay in seeking interim orders and Mr Kós accepts that. Mr Kós submitted, however, that if the substantive proceeding had been brought earlier then there would have been no need for the earthworks to be delayed. The substantive hearing could have been determined before Kotuku was ready to carry out the earthworks.[43] I accept that point. While there were reasons why the plaintiff did not commence its proceeding earlier (and also reasons why it did not seek interim orders earlier) the fact is that it could have brought the substantive proceedings earlier. Had it done so, a substantive proceeding could have been heard earlier and the earthworks carried out in the winter period to coincide with readying the playing field for the marketing of stage nine. [44] This factor supports the view that an undertaking as to damages is appropriate.Result[45] The plaintiff's application for interim orders in the absence of an undertaking as to damages is declined. [46] If, however, the plaintiff provides an undertaking as to damages capped at $80,000 (to cover Kotuku for any direct costs from a delay to the earthworks). I would be prepared to make interim orders preventing the earthworks from proceeding. If the plaintiff is willing to provide that undertaking, in view of Kotuku's willingness to provide an undertaking not to proceed with the earthworks (see [5] above), formal orders may not be necessary. But if they are, and agreement cannot be reached as to the terms of the orders, then the parties have leave to refer the matter back to me. Mallon JSolicitors: P Beverley, Head Office Solicitor, Department of Conservation, Wellington, pbeverley@doc.govt.nz J S K
s, Barrister, Wellington, jsk@40johnston.co.nz