TE WHARE O TE KAITIAKA NGAHERE INCORPORATED SOCIETY v WEST COAST REGIONAL COUNCIL CA39/2015 [2015] NZCA 356

TE WHARE O TE KAITIAKA NGAHERE INCORPORATED SOCIETY v WEST COAST REGIONAL COUNCIL CA39/2015 [2015] NZCA 356 [7 August 2015]IN THE COURT OF APPEAL OF NEW ZEALANDCA39/2015[2015] NZCA 356BETWEEN TE WHARE O TE KAITIAKANGAHERE INCORPORATED SOCIETYApplicantAND WEST COAST REGIONAL COUNCILFirst RespondentTBFREE NEW ZEALAND LIMITEDSecond RespondentDIRECTOR-GENERAL OFCONSERVATIONThird RespondentANIMAL CONTROL PRODUCTSLIMITEDFourth RespondentHearing: 27 July 2015Court: Ellen France P, Randerson and White JJCounsel: P A Paterson for Applicant with E G Leaf as McKenzie FriendJ A Knight and H S Pedler for RespondentsJudgment: 7 August 2015 at 11:30 amJUDGMENT OF THE COURTA The application for an extension of time for leave to appeal is granted.B The application for special leave to appeal under s 308 of the Resource Management Act 2011 is dismissed.C The applicant must pay costs to the respondents for a standard application Band A with usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Randerson J)Introduction[1] The applicant is an incorporated society opposed to the use of 1080 poison for pest control. It brought proceedings in the Environment Court in July 2012 for declarations under the Resource Management Act 1991 (the RMA) relating to alleged breach of the conditions of 12 resource consents granted by the first respondent to the second respondent.1 The present respondents and other parties were granted party status under s 274 of the RMA.[2] In four of the declarations, the applicant pleaded that the fourth respondent (ACP) was a party to the alleged contraventions of the conditions of the resource consents. In April 2013 the applicant consented to an order striking out the declarations affecting ACP.2 By a judgment issued on 18 June 2013 Environment Judge Borthwick ordered the applicant to pay increased costs of $10,000 to ACP (the costs decision).3[3] On 3 March 2014, Environment Judge Kirkpatrick made an order that the applicant provide security for costs in the total sum of $25,000 for five named parties including the first, second and third respondents (the security decision).4[4] The applicant appealed to the High Court against the costs decision and the security decision.5 By a judgment of 13 August 2014, Dunningham J dismissed both1 TBFree New Zealand Ltd, formerly the Animal Health Board Inc.2 Re Te Whare O Te Kaitiaki Ngahere Inc [2013] NZEnvC 60.3 Re Te Whare O Te Kaitiaki Ngahere Inc [2013] NZEnvC 136 [Costs Decision].4 Te Whare O Te Kaitiaki Ngahere Inc v TBFree New Zealand Ltd [2014] NZEnvC 41 [Security Decision].5 The applicant also appealed to the High Court against the Environment Court's refusal to state acase under s 287 of the Resource Management Act 1991 (RMA) but the outcome of that appeal is no longer in issue.appeals.6 The applicant then sought leave to appeal to this Court on a question of law under s 308 of the RMA. Dunningham J dismissed that application by a judgment delivered on 31 October 2014.7[5] The applicant has now applied to this Court for special leave to appeal. The last date for doing so was 28 November 2014. On that date, the applicant attempted to file its application by email but was advised it would have to file the application in hard copy form. That was not achieved until 4 December 2014. The application was not served on the respondents until 2 February 2015.[6] Against that background, there are two applications for our consideration:(a) An application for special leave to appeal to this Court; and(b) An application for an extension of time to file the application for special leave.[7] Mr Knight acknowledged that the respondents had not been prejudiced by the delay. This judgment will focus primarily on the application for special leave. We record that Mr Paterson was permitted to represent the applicant as a layperson along with a McKenzie friend.The Appeal to the High Court[8] Dunningham J noted that the proceedings in the Environment Court sought 761 declarations against 39 different persons and organisations directly or indirectly involved with the distribution and use of 1080. The application was supported by 23 affidavits with exhibits totalling nearly 1,500 pages. In due course, 323 of the declarations were either struck out or withdrawn but some 438 claimed declarations remained on foot. Further applications for strike out remain extant, the Environment Court determining that the five applications for security for costs be determined first.86 Te Whare O Te Kaitiaki Ngahere Inc Soc v Animal Control Products Ltd [2014] NZHC 1903, (2014) 18 ELRNZ 175 [High Court appeal].7 Te Whare O Te Kaitiaki Ngahere Inc Soc v Animal Control Products Ltd [2014] NZHC 2690 [High Court leave judgment].8 See Security Decision, above n 4, at [5]–[8].The security decision[9] The Judge noted that the security decision was of greatest concern to the applicant. She recorded the questions of law raised by the applicant:9Main Question of Law on Appeal to High Court:Does the public interest in upholding the RMA's safeguards (appealprovisions S.299, enforcement order SS.314(e), 316, etc.) against misuse of extremely hazardous ecotoxic poison outweigh the pecuniary security-of- costs interests of government-dependent/controlled poisoning operators (the defendants)?Sub Questions of Law on Appeal to High Court:1. Should the provision of the RMA (appeal provisions S299, enforcement order SS.314(e), 316 etc.) be effectively invalidated by granting security-for-costs on reliance on wrong facts and by undermining current Court-of-Appeal case laws?2. Should the lower Environment Court appealed against effectively have been allowed to decide an appeal to the High Court contrary to appeal provision per S.299?[10] A further point advanced was whether the applicant had been denied access to justice when its case was not clearly untenable.[11] Dunningham J observed that an appeal to the High Court under s 299 of the RMA is confined to questions of law and is not a general right of appeal. Moreover, it was an appeal against the exercise of a discretion and could only succeed on one or more of the grounds identified by the Supreme Court in Kacem v Bashir.10[12] The Judge found that:(a) It was not in dispute that the threshold test was met namely, there must be reason to believe that the applicant would be unable to pay the costs of the opposing parties if the application were unsuccessful.(b) Judge Kirkpatrick had fully and carefully outlined the legal principles relating to applications for security for costs.9 High Court appeal, above n 6, at [49].10 Kacem v Bashir [2010] NZSC 112, [2011] 2 NZLR 1 at [32], citing May v May (1982) 1 NZFLR 165 (CA) at 170.(c) He had recognised public interest factors relevant to the exercise of the discretion and had correctly found it was not necessary for theparties seeking security for costs to show that the applicant's case wasclearly untenable.(d) He had also identified that it was necessary to take into account as a relevant consideration whether the ordering of security would force an impecunious applicant to discontinue the case.(e) While the Judge had recognised that the applicant was acting in good faith there were legitimate concerns about the manner in which the applicant had presented its case. In particular, the applicant had resisted suggestions from the Court that the scope of the proceedingscould be limited by filing a selection of "exemplar" declarations in thefirst instance which would have limited the risk of a costs award and had the effect of achieving a more favourable outcome on the issue of security for costs.[13] In these circumstances, Dunningham J considered that the applicant was the architect of its own fate.The costs decision[14] The question of law the applicant sought to raise in the High Court on the costs appeal was:Does S.285 RMA (awarding of costs as Environment Court considers reasonable) exclude objective reasonability, including the provisions of S.279 (strike-out of costs application if Judge considers it frivolous or vexatious or otherwise an abuse of process)?[15] Dunningham J found that the award of costs made by Judge Borthwick involved the exercise of a discretion. The Environment Court had correctly identified the relevant considerations including the principle that there was no immunity from costs for public interests groups.1111 Peninsula Watchdog Group (Inc) v Coeur Gold New Zealand Ltd [1997] 3 NZLR 463 (HC).[16] Dunningham J also noted that Mr Paterson had specifically conceded in the Environment Court that the proceedings in relation to ACP disclosed no reasonable case; that three of the declarations were outside the jurisdiction of the Environment Court; and that there was no evidential basis for the fourth declaration involving ACP.[17] Finally, the Judge took into account the following additional factors:(a) Although the Environment Court had acknowledged the general public interest in a case designed to ensure that resource consent conditions were complied with, it had inevitably concluded that this factor did not carry weight in circumstances where the applicant had acknowledged it had no reasonable cause of action against ACP.(b) While the case was withdrawn against ACP, the path to that point had not been straightforward and ACP had incurred considerable costs to that stage.(c) There was no identified error of law.(d) There was sufficient evidence to justify an award higher than usualcosts amounting to approximately 60 per cent of ACP's actual costs.The High Court decision refusing leave to appeal[18] The applicant sought leave to appeal on four questions of law:12(a) Should the defendants' strike out case/application and/or security- for-costs case/application have been struck out per S.279(4)(a),(c) on reason that proof of their frivolous, vexatious and abuse-of-process character had been provided?(b) Does the Supreme-Court case-law example ([2012] NZSC 49) require entering the standard hearing process under RMA provisionsas default, when no proof of a "clearly untenable" case wasprovided?(c) Does S.285 RMA (awarding of costs as Environment Court considers reasonable) exclude objective reasonableness, including12 High Court leave judgment, above n 7, at [10].the provisions of S.279 (strike-out of costs application if judge considers it frivolous or vexatious or otherwise an abuse of process)?(d) Does the public interest in upholding the Resource ManagementAct's safeguard (appeal provisions S.299, enforcement order SS.314(e), 316 etc.) against misuse of ecotoxic poison outweigh the pecuniary security-of-costs interests of government entities who are the ecotoxic poison distributions, manufacturers and importers (the defendants)?[19] Dunningham J concluded that none of the questions raised an arguable error of law, let alone one that was of general and public importance such as to justify a further right of appeal. The Judge considered that the questions of law did not arise in the proceedings, assumed factual findings which had not yet been made, or sought to revisit findings in the Environment Court which were made after having regard to well-established principles.Submissions in support of the application for special leave to appeal[20] Mr Paterson confirmed on behalf of the applicant that the question of law upon which special leave to appeal to this Court was sought was now confined to this question: whether entities that are publicly financed can delay and prevent ahearing which is of undisputed public interest by requesting security for costs and costs?[21] Mr Paterson's essential submission was that, by reason of the decisions madein the Environment Court, the applicant was effectively prevented from presenting its case on the merits. He explained that the applicant had retained a lawyer for a limited period but otherwise was not legally represented and did not have sufficient funds to obtain legal advice. The case had merit and it was in the public interest that the applicant should be permitted to pursue it, particularly since the respondents were publicly funded entities. Mr Paterson agreed in answer to questions from us that it would be desirable to limit the scope of the declarations sought in the Environment Court. He said the applicant was prepared to consider this.Applications for special leave to appeal — principles[22] The application for special leave is to be considered under s 308 of the RMA in the form in which it stood prior to the introduction of the Criminal Procedure Act 2011. Section 308 imported s 144 of the Summary Proceedings Act 1957. This Court may grant special leave if: in the opinion of [the] court the question of law involved in the appeal isone which, by reason of its general or public importance or for any other reason, ought to be submitted to the Court of Appeal for decision.13[23] It is well settled that an application for special leave to appeal must raise a question of law that is capable of bona fide and serious argument in a case involving some public or private interest that is of sufficient importance to outweigh the cost and delay of a further appeal.14DiscussionThe security decision[24] We accept the submission made by Mr Knight on behalf of the respondents that the applicant has not shown there is an arguable question of law upon which special leave to appeal should be granted. In terms of s 278(1) of the RMA, the Environment Court and Environment Judges have the same powers that a District Court has in the exercise of its civil jurisdiction. The District Court Rules 2009 provide in r 4.20 a discretion to order security for costs if there is reason to believe that a plaintiff will be unable to pay the costs of the defendant if the plaintiff is unsuccessful.15 There being no dispute that the applicant would be unable to pay the costs of the respondent if the applications were unsuccessful, the Environment Court Judge had a discretion to require security for costs to be paid in respect of a sum which the court considered sufficient.1613 Summary Proceedings Act 1957, s 144(3).14 R v Slater [1997] 1 NZLR 211 (CA) at 214; Downer Construction (NZ) Ltd v Silverfields Developments Ltd [2007] NZCA 355, [2008] 2 NZLR 591 at [33].15 District Court Rules 2009, r 4.20.1(b). Under r 4.20.7 and the definitions in r 1.8, in the proceedings at issue, the applicant is a plaintiff and the s 274 parties are defendants.16 District Court Rules, rr 4.20.3 and 4.20.4(a).[25] The principles upon which the court exercises its discretion to order for security for costs are well settled. They have been elaborated in decisions such asBell-Booth Group Ltd v Attorney-General.17 As this Court emphasised inMcLachlan v MEL Network Ltd, the decision as to whether to order security and, if so, the amount of security are highly discretionary.18[26] We accept that access to the courts for a genuine party is not lightly to be denied.19 As the Supreme Court has recently said, applications for security in first instance proceedings call for careful consideration and judges are slow to make an order for security which will stifle a claim.20[27] We also accept that the discretion is to be exercised in the interests of justice and that the particular case must have regard to any public interest considerations the litigation serves. This was made clear by this Court in Ratepayers and Residents'Association Inc v Auckland City Council.21 The same case recognised that parties acting in a responsible way as watchdogs of the public interest can perform a valuable public service in bringing litigation which exposes public law questions. The District Court Rules also recognise that in certain circumstances public interest may be taken into account as a factor in an award of increased costs.22[28] Similar points have recently been made by the Supreme Court inEnvironmental Defence Society Inc v The New Zealand King Salmon Company Ltd.23The Court was there considering whether a costs award should be made against one of the appellants (Sustain Our Sounds). It was determined that costs should lie where they fell. The Supreme Court affirmed the general principle that costs should follow the event.24 The fact that a party is representing a relevant aspect of the public interest and does not have any prospect of personal advantage in the litigation17 Bell-Booth Group Ltd v Attorney-General (1986) 1 PRNZ 457 (HC) at 460–463.18 McLachlan v MEL Network Ltd (2002) 16 PRNZ 747 (CA) at [13]–[16].19 McLachlan v MEL Network Ltd, above n 18, at [15].20 Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737 at [3].21 Ratepayers and Residents' Association Inc v Auckland City Council [1986] 1 NZLR 746 (CA) at [750].22 District Court Rules, 4.6.3(c)23 Environmental Defence Soc Inc v The New Zealand King Salmon Company Ltd [2014] NZSC 167.24 At [12], [33] and [39].does not displace the usual principle but may be a relevant factor in determining whether costs should be ordered and the amount of any award.25[29] In the particular case, relevant factors included that Sustain Our Sounds had some success in the appeal; the appeals concerned matters of public interest; Sustain Our Sounds was not pursuing a commercial benefit and it had acted reasonably in its conduct of the appeal.26[30] The majority emphasised however that the decision did not mean that whenever a group claiming to be acting in the public interest brings an appeal to the Supreme Court, it would be insulated from paying costs if it were unsuccessful. Rather, the outcome would be determined by the particular circumstances of the case.27[31] A similar approach has long been adopted in the Environment Court,applying Salmon J's decision in Peninsula Watchdog Group (Inc) v Coeur Gold New Zealand Ltd.28 While acknowledging the recognition given in the Environment Court to environmental groups and other public interest objectors, the High Court held that the Court must retain the ability to order costs against voluntary organisations where appropriate.[32] We are satisfied Judge Kirkpatrick correctly recognised the relevant principles and was entitled to exercise his discretion to order security for costs.Given the number of parties, the amount ordered was within the Judge's discretion.The question of law advanced by the applicant simply invites reconsideration of theexercise of the Environment Judge's discretion. It does not raise an arguablequestion of law and is not one which by reason of its general or public importance or for any other reason ought to be submitted to this Court for decision.25 At [12] and [24].26 At [44]–[45].27 At [45].28 Peninsula Watchdog Group (Inc) v Coeur Gold New Zealand Ltd, above n 11 at 471–473.The costs decision[33] We take a similar view in relation to the costs decision. The essence of theapplicant's submission on this point is the same as that advanced in relation to thesecurity decision. The costs decision made was discretionary in nature. Judge Borthwick recognised the relevant principles which are well settled. There was a proper basis upon which she could exercise her discretion to award increased costs.29 The award made was open to her.[34] We are satisfied there is no arguable question of law which ought to be submitted to this court for decision.The application for extension of time[35] The delay filing the application was brief. The delay in serving the respondents was not unduly long and there has been no resulting prejudice to the respondents. We propose to grant this application.Result[36] The application for an extension of time for leave to appeal is granted.[37] The application for special leave to appeal under s 308 of the Resource Management Act 2011 is dismissed.[38] The applicant must pay costs to the respondents for a standard application Band A with usual disbursements.Postscript[39] The Principal Environment Judge struck out the substantive application brought in the Environment Court on 21 January 2015.30 We were informed that this judgment is currently under appeal to the High Court but has been adjourned pending the outcome of the applications before this Court. Mr Knight accepted that29 District Court Rules, r 4.6.3(b).30 Te Whare O Te Kaitiaki Ngahere Inc v TBFree New Zealand Ltd [2015] NZEnvC 8.jurisdiction existed for the Environment Court to vary the amount required to be paid for security for costs if, for example, the scope of the applications could be appropriately limited as we mentioned at [21]. We express no view on this point. It will be a matter for the parties to explore whether some accommodation could be reached.Solicitors:Ross Dowling Marquet Griffin, Dunedin for First RespondentChapman Tripp, Wellington for Second and Fourth RespondentsCrown Law, Wellington for Third Respondent