GIBBS V THE NEW PLYMOUTH DISTRICT COUNCIL HC NWP CIV 2004-443-115

GIBBS V THE NEW PLYMOUTH DISTRICT COUNCIL HC NWP CIV 2004-443-115 15 March 2006IN THE HIGH COURT OF NEW ZEALAND NEW PLYMOUTH REGISTRY CIV 2004-443-115IN THE MATTER OF the Judicature Amendment Act 1972, rule 264 of the High Court Rules and the Reserves Act 1977 BETWEEN VICTOR LEWIS GIBBS Plaintiff AND THE NEW PLYMOUTH DISTRICT COUNCIL Defendant Hearing: 15, 16 and 19 September, 1, 2 and 3 November 2005 Appearances: R C Laurenson for Mr Gibbs D J S Laing and J Mooar for New Plymouth District Council S J Harrop for Tongaporutu Bach Leaseholders' Association Judgment: 15 March 2006 at 4.30pmJUDGMENT OF HEATH JSolicitors:James T Boyd, New Plymouth Simpson Grierson, Wellington Billings, New Plymouth Counsel: R C Laurenson, WellingtonIntroduction[1] Tongaporutu is a small settlement in Taranaki, situated between Mt Messenger and Mokau. State Highway 3, the main road between New Plymouth and Te Kuiti, crosses the Tongaporutu River. Looking westward, from the bridge over the river, a row of 26 baches is visible along the riverbank. The baches stand on land that has been classified as a recreation reserve. The land is administered by the New Plymouth District Council (the Council). [2] Baches developed along the Tongaporutu River from about 1930. The number of baches grew over the years. In 1975, formal leases were granted in favour of the 26 bach owners for a period of 30 years. The leases were non- renewable. They were to terminate, with anticipated removal of the baches, in 2005. [3] On 15 February 2005 the Council decided to issue new leases in favour of the 26 bach owners. In doing so, the Council purported to act under s73(3) of the Reserves Act 1977 (the Act). Mr Gibbs, whose family have lived on land contiguous to the reserve land for many years, seeks judicial review of the decision to grant new leases. [4] Mr Gibbs claims that the Council's decision is vitiated because: a) It was predetermined. b) The Council acted for an unlawful purpose, namely a purpose contrary to the objects and purposes of the Act. c) In making its decision, the Council acted unreasonably (in the sense described in Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 (CA)), took into account irrelevant considerations and failed to take into account relevant considerations.[5] The Council contends that its decision was made in accordance with the scheme and purpose of s73(3) of the Act. It disputes the allegations of bias and unlawful purpose. [6] The position of the Council is supported by the Tongaporutu Bach Leaseholders' Association (the Association). Mr Harrop, who appeared for the Association, indicated that it was content for the Council to address issues relevant to the decision in issue. However, Mr Harrop sought leave to be heard, if necessary, on any questions of relief. I excused Mr Harrop from attendance during the course of most of the hearing on that basis. [7] At the conclusion of the hearing I said that I would rule first on the claims made by Mr Gibbs. I added that if any claims were made out I would reconvene the hearing to consider submissions on the question of relief. [8] A site visit was made to the reserve land on 1 November 2005. The purpose of the visit was to orientate myself as to the topography of the area.Leases of reserve land: the statutory framework[9] The scope of the Council's powers to grant a lease over reserve land must be determined by reference to the Act. While s73(3) of the Act is the central provision in issue, that sub-section must be construed in light of the purpose of the Act as a whole. [10] Section 17 of the Act deals with recreation reserves. Section 17(1) provides:17 Recreation reserves(1) It is hereby declared that the appropriate provisions of this Act shall have effect, in relation to reserves classified as recreation reserves, for the purpose of providing areas for the recreation and sporting activities and the physical welfare and enjoyment of the public, and for the protection of the natural environment and beauty of the countryside, with emphasis on the retention of open spaces and on outdoor recreational activities, including recreational tracks in the countryside.[11] Section 17(2) states that every recreation reserve must be administered in a manner that enables the public to have freedom of entry and access to the reserve. That general obligation is subject only to specific powers conferred by ss53 and 54 of the Act, to bylaws made under the Act and to such conditions and restrictions as the administering body considers necessary "for the protection and general well being of the reserve and for the protection and control of the public using it": s17(2)(a). [12] The objects and purposes of the Act are set out in the Long Title and s3. The Long Title refers specifically to control, management, preservation, development and use of the coast line and countryside and the need to make provision for public access to those areas. Section 3 requires that the Act be administered, among other things, for the purpose of providing, for public use, areas of New Zealand that possess recreational use or potential, whether active or passive: s3(1)(a)(i). That form of administration is expressly required to ensure preservation and management of those areas of land for the benefit and enjoyment of the public. [13] The original 1975 leases were entered into under the provisions of the Reserves and Domains Act 1953, the statute then in force. That statute was repealed and replaced by the Act. [14] Sections 26 and 26A of the Act deal with vesting of reserves. The effect of those provisions is to confer legal ownership of the reserve in the Crown while making it clear that the land is held on trust for all New Zealanders. Section 26A (added by a 1979 amendment to the Act) deals with cases in which the territorial authority administering the reserve was appointed before 1 January 1980. Because the land was designated as a reserve under the 1953 Act, s26A applies in this case. [15] Section 26A(1) and (2) provide:26A Vesting of certain reserves(1) Where any administering body that is a territorial authority has, before the 1st day of January 1980 been appointed to control and manage any reserve classified under section 16 of this Act (whether before or after the 1st day of January 1980) as a recreation reserve or local purpose reserve, thatreserve shall, without further authority than this section, vest in that administering body. (2) All land so vested shall be held in trust for the purpose or purposes for which the reserve is classified. .[16] There are no decisions that interpret s26A. However, the underlying idea of "trust" ownership was mentioned in Wanganui District Council v Tangaroa [1995] 2 NZLR 706. That case concerned the occupation of Motua Gardens in Wanganui. In that case, Heron J, at 719, said: As to the second cause of action based on the Reserves Act 1977, I am not required to deal with that, except to take it into account in the orders that I make. The public must have freedom of entry and access to this reserve, along with many others of like kind, and the occupation, excluding as it does persons from the reserve, is clearly contrary to the policy of the Act.[17] Section 26A(2) requires the administering authority to hold the land in terms of the statutory provisions. The general public of New Zealand must be regarded as the beneficiaries. The concept is one of public ownership: s26A emphasises the public use for which reserve land is classified. [18] The administering authority must submit a management plan to the responsible Minister. The Minister is required to approve the plan under s41 of the Act. Once the plan is approved, the Council administers the reserve in accordance with its terms. [19] Section 41 draws a distinction between the functions of the administering body and those of the Minister. The responsible Minister is the Minister of Conservation. The respective roles of the administering body and the Minister are set out in ss40, 40A, 40B, 41, 42-52 and ss53-64 respectively. It is unnecessary to refer in detail to those provisions. The essential difference in function is that the Minister's role relates to matters of national public interest while the administering authority's concerns are administrative or local in nature. [20] Section 73(3) of the Act empowers the administering body to lease land. Section 73 draws distinctions between the respective roles of the Minister and theadministering body. Section 73(1) and (3) of the Act should be read together. They provide:73 Leasing of recreation reserves for farming, grazing, afforestation, or other purposes(1) Where any recreation reserve or any part of such a reserve is not for the time being required for the purpose for which it was classified, or where the Minister considers it in the public interest, or where the administering body of any recreation reserve has decided under section 53(1)(a)(ii) of this Act that it is necessary or desirable to farm or graze the reserve or any part thereof, leases of the reserve or of any part thereof may be granted by the administering body with the prior consent of the Minister in cases where the reserve is vested in such a body, or by the Minister in any other case. (3) Where any recreation reserve or any part of such a reserve is not being used for the purposes of a recreation reserve and in the opinion of the Minister is not likely to be used for that purpose, but it is inadvisable or inexpedient to revoke the reservation, leases of the whole or any part thereof may be granted by the administering body with the prior consent of the Minister in cases where the reserve is vested in such a body, or by the Minister in any other case. .[21] Viewed in isolation, s73(1) can be seen as separating out functions of national and local interest respectively. The Minister is responsible for matters of national public interest, while the administering authority deals with administrative or local concerns. That interpretation is consistent with s73(3) which distinguishes between the decision whether to make recreation reserve land available for leasing (a Ministerial decision) and the formal execution of any leases granted (by the administering body). [22] While that separation of powers is readily understandable, the differing functions have been merged as a result of the exercise of broad powers of delegation under s10 of the Act. The Minister's decision making powers under s73(3) have been delegated to the Council. The Council now wears both hats in the s73(3) decision making process. [23] The Minister's authorities under s73(3) were delegated initially in 1999 and subsequently in 2004. For present purposes, the 2004 delegation is relevant.[24] Under the 2004 delegation, the Minister delegated to the administering body: a) The ability to decide whether a recreation reserve "was not likely to be used" for the purposes of a recreation reserve. b) The ability to consent to or to decline consent to the grant of a lease by an administering body of the whole or part of the reserve vested in the administering body. c) The power to grant or to decline to grant leases of the whole or part of a reserve held under an appointment to control and manage the land. d) The exercise of all powers conferred on the Minister by the First Schedule to the Act that pertain to leases granted under s73(3). [25] The limitations on the power of delegation were expressed as follows:Only exercisable where the activity is provided for or contemplated in an approved management plan for the reserve or the activity is an existing use and the effects of the use will be the same or similar in character, intensity and scale.[26] Those delegations have placed the Council in a position of conflict. While, no doubt, the Council would prefer to make its decisions based on the interests of ratepayers who lived in its territorial jurisdiction (in particular, those who live in the vicinity of the reserve) the functions delegated to it by the Minister require the Council to have regard to (wider) national interests also. Those interests must include the desirability of retaining reserve land in public ownership for the use and enjoyment of all New Zealanders. [27] The leases granted in 1975 were to expire on 31 March 2005. There were no rights of renewal. Exercising powers in its dual capacities, Council decided, in February 2005, to issue the leases now in dispute. The bach holders have continued to occupy the baches pending resolution of the present proceedings. The question for determination is whether the decision to grant the leases was made lawfully.The history of the baches[28] At the turn of the 20 th century, the only indication of settlement on the reserve land was the existence of a wharf and shed. The baches were constructed over a period of time. A few of the earliest baches, built in the 1930s, remain. [29] The records of the Clifton County Council (the predecessor of the Council) reveal that approval was given progressively for baches to be erected on the land: a) March 1942 – Approval for one bach to be constructed was granted. b) April 1942 – Retrospective approval was granted for four baches already constructed on what bach owners thought was "no man's land". c) March 1945-June 1948 – 13 sections allocated. d) September 1952 – A plan of the area was prepared and more sections were made available, on the condition that a river protection wall be built and sections back-filled. e) December 1952 – A total of 26 sections were allocated for use as baches, excluding two occupied by the Ministry of Works. f) December 1979 – Retrospective approval was granted for the demolition of an existing bach and the erection of a new bach on site 22. This information is taken from the Tongaporutu Recreation Reserve Management Plan (August 2004) at 16-17, para 4.4. [30] The 26 existing baches are located on a narrow strip of land along the southern bank of the Tongaporutu River which, separated by a formed road (Clifton Road), abuts Mr Gibbs' property. The formed road provides access from State Highway 3 to the baches and to reserve land to the east and west of them. At thesouthern extremity of the formed road is a fence-line on the other side of which are the undulating pastures of Mr Gibbs' property. Many (perhaps all) of the baches were constructed when the land was designated as a road reserve. [31] When the land was vested (originally) as a domain and (subsequently) as a recreation reserve those classifications were made with the knowledge that the baches existed and were occupied by members of the public. It was also known that the baches were used for private purposes only. [32] In 1968-1969 the Clifton County Council tried to make more sections available to members of the public. At that stage, on behalf of the Crown, the Lands & Survey Department intervened, emphasising that the land was public land and should not be alienated in the manner proposed. [33] That intervention led to negotiations that, in 1975, resulted in the declaration of a recreation reserve and the execution of leases in favour of bach holders for a period of 30 years. [34] The baches occupy a significant area of the reserve. Public access to the river estuary on the western side of State Highway 3 is confined in most parts to the areas at each end of the reserve and, at low tide, the "beach" frontage to the reserve. Clifton Road provides pedestrian and vehicle access from the bridge to the river mouth. Some access is available along the front of about eight baches at the western end of the reserve. Remaining baches are situated too close to the river erosion protection wall to permit pedestrian access from one part of the reserve to the other. [35] The baches do not fit the criteria for registration as historic places or areas under s23 of the Historic Places Act 1993. However, the Heritage Adviser for the New Zealand Historic Places Trust has expressed a preliminary opinion that the baches do have value, on account of their social and emotional significance to the bach holders and the community of Tongaporutu.Decision under challenge[36] Following approval of the Tongaporutu Recreation Reserve Management Plan in August 2004, the Council put in place a public consultation process to consider possible renewal of the bach leases. That aspect of the Council's inquiry (rightly or wrongly) was regarded as independent from its review of the Management Plan. [37] A public hearing was held on 15 and 16 December 2004 to elicit views on a proposal to issue new leases on expiry of the 1975 leases. The public hearing took place before a Hearing Commission appointed by the Council. The Commission was made up of three Councillors. A transcript of the hearing has been put before me. [38] In a report circulated before the hearing, Council officials identified a six- step approach to decision making on the lease issue. This was done to ensure compliance with the requirements of both the Act and the Local Government Act 2002. The report stated thatEach of the following decisions must be made in order and applied to each of the bach sites individually: (a) Decide that a part of the reserve is not being used for the purpose of a recreation reserve (b) Decide that the part of the reserve that is not likely to be used for that purpose (c) Decide that it is inadvisable or inexpedient to revoke the reservation (d) Decide what type of use (eg forestry, restaurant or baches) would be the best use of the land. This must have been contemplated in the Reserve Management Plan or is an existing use of similar size, intensity, character and scale (Local Government Act outcome to be taken into account, but uses should still be largely compatible with the rest of the reserve); (e) Decide on what the best tenure of the land would be for that activity (eg s73 lease or Council ownership); if a lease is chosen as the best form of tenure then decide what terms and conditions of lease would best benefit the community in whose trust the land is held.[39] The first three questions address criteria set out in s73(3) of the Act. The fourth question focuses on the limitations to the relevant Ministerial delegations given in 2004. The fifth and sixth questions were consequential on answers to the earlier four. The reference in question six to "in whose trust the land is held" seems to be a reference to s26A(3) of the Act. [40] The report continued:Essentially the 2004 Reserve Management Plan addressed the first three tests of this decision on pages 14 and 15 when it discussed the level of current and predicted future use of the reserve and concluded:The Council's present view is that the area currently occupied by the baches is not currently required for recreation reserve. However this is not a situation where the Council considers that the reserve should be revoked. It may well be required for recreation purposes in the future. (my emphasis in italics only)[41] The sentence highlighted in italics suggests that the officials who prepared the report may have misunderstood the second of the s73(3) criteria. Instead of stating that the land on which the baches stand was not likely to be used as reserve, the report spoke of the land not being "currently required" for reserve purposes. Mr Laurenson, for Mr Gibbs, put some weight on that distinction in submissions to me. [42] It is clear from the transcript of the hearing before the Hearing Commission that the presiding Councillors worked their way through each question set out in para [38] above. The Councillors determined that the leases should be granted on conditions. It is unnecessary to specify precisely what conditions were imposed because Mr Gibbs' challenge is to the decision to issue the leases rather than to their terms. [43] The recommendation of the Hearings Commission was approved by Council at a meeting on 15 February 2005. It is that decision that is under attack in the present proceeding.The case for Mr Gibbs[44] Mr Laurenson accepted that the challenge to the Council decision could be reduced to three core elements: predetermination, unlawfulness and Wednesburyunreasonableness. [45] Mr Laurenson relied, in support of his predetermination submission, on evidence of an increasingly sympathetic view of the bach holders' position that he submitted was evidenced by correspondence involving and resolutions passed by the Council. That sympathy, Mr Laurenson submitted, led to the decision of the Clifton County Council to issue leases in 1975 and subsequently induced the Council to pass the resolution of 6 March 2002 when it adopted a recommendation that it exercise delegated authority to grant leases. From that point, Mr Laurenson submits, there was a clear predisposition in favour of the bach holders that vitiates the Council's decision of 15 February 2005 on grounds of actual or apparent bias. [46] On the unlawfulness and Wednesbury unreasonableness issues: a) First, the legal analysis undertaken to make the decision to grant leases was flawed. Mr Laurenson submitted that the Council erred because it failed to apply faithfully the test set out in s73 of the Act. b) Second, the Council failed to take into account the overall purposes of the Act as evidenced by, in particular, the Long Title and s3. In relation to s73(3), the simple point is that, if the baches were removed, members of the public would walk over and may picnic on the riverbank land on which the baches stand. Therefore, Mr Laurenson submits, there was no basis for the Council to decide that it was not likely the land would be used for recreational purposes. c) Third, the Council's decision was irrational because it failed to ask (and, therefore, answer) the right questions.For those reasons, Mr Laurenson submits that the decision was unreasonable (in theWednesbury sense) and was unlawful (because it did not reflect application of the statutory test). [47] Mr Laurenson relied upon Attorney-General v Ireland [2002] 2 NZLR 220 (CA) at 229-233, paras [31]-[44] (inclusive). That case also involved a consideration of the Act, in particular s58. The Court of Appeal considered the existence of a dual purpose and whether that was sufficient to vitiate a decision. At 231-232, paras [39]- [42], Keith J, delivering the judgment of the Court, said:[39] The authorities show that Courts have adopted five or six different approaches to the situation where the decider has sought to achieve both authorised and other purposes. (See eg de Smith, Woolf and Jowell, Judicial Review of Administrative Action (5th ed, 1995) at para 6–077 (they have six ("none of which is entirely satisfactory") but (1) and (2) appear to be the same) and Taylor, Judicial Review: A New Zealand Perspective (1991) at para 14.40 who identifies five tests and says three can be seen to come to the same conclusion.) One prominent variable involves the ranking of the unauthorised purposes (true or dominant as opposed to subsidiary), the "but for that purpose" test, the materiality of that purpose and the very existence of that purpose. All but the last involve the difficulty for the Courts of speculating about the weight actually given to particular purposes, an even more difficult matter if the decision is made by a multi–member body (Aronson and Dyer, Judicial Review of Administrative Action (2nd ed, 2000) at pp 250 – 251). [40] A further variable which we consider to be crucial in the context of the legislation in this case is the character or quality of the additional purpose. Does the particular purpose or even more its fulfilment "run counter", to "circumvent" or "undermine" the proper statutory purpose, to quote Cooke J in Poananga [v State Services Commission [1985] 2 NZLR 385 (CA)]? The Crown in its written submissions relied on the more directly relevant leading authority of Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997. Lord Reid, in one of his great administrative law judgments, says this at p 1030: Parliament must have conferred the discretion with the intention that it should be used to promote the policy and objects of the Act; the policy and objects of the Act must be determined by construing the Act as a whole and construction is always a matter of law for the court. In a matter of this kind it is not possible to draw a hard and fast line, but if the Minister, by reason of his having misconstrued the Act or for any other reason, so uses his discretion as to thwart or run counter to the policy and objects of the Act, then our law would be very defective if persons aggrieved were not entitled to the protection of the court. So it is necessary first to construe the Act. [41] He then reviewed the legislation and the facts and returned to the wider issues at pp 1032 – 1033:If it is the Minister's duty not to act so as to frustrate the policy and objects of the Act, and if it were to appear from all the circumstances of the case that that has been the effect of the Minister's refusal, then it appears to me that the court must be entitled to act. [42] That careful wording, consistently with that of Cooke J in Poananga, reminds us that purposes not within the statute are not necessarily "invalid" or "improper"; the additional pursuit of such other purposes may not thwart or frustrate the policy of the Act in question. As indicated in both those cases, we need to return to the terms of the Reserves Act.Those observations were cited to support the submission that the decision to grant leases was made contrary to the underlying purposes of the Act.The case for the Council[48] For the Council, Mr Laing, opposed the application for judicial review on the following bases: a) The Council's decision to grant new leases of the baches was not the result of any predetermined policy as from January 2002. Nor did it result from the application of "closed minds" when the hearings were held in December 2004 and the Council decision made in February 2005. b) The construction of s73(3) of the Act favoured by Mr Laurenson is incorrect. While, in interpreting s73(3), the legislative scheme had to be taken into account, the phrase "not likely to be used" had to be informed by the particular statutory context. Mr Laing submitted that s73(3) was in the nature of an "exception power", unlike powers to lease conferred by ss53 and 54 of the Act, to which s17(2) (unlike s73(3)) was expressly subject. c) The Council took into account all relevant factors. It did not take into account any irrelevant factors. Its decision to grant the leases was one open to it in its capacity as decision-maker. Accordingly, the Court ought not to interfere with the decision.Analysis of competing submissions(a) The predetermination issue[49] Allegations of bias are made in respect of the Council's decision to grant the leases. That decision was made by a Hearing Commission that recommended to the Council, on 16 December 2004 and 3 February 2005 respectively, that new leases of all 26 baches be granted. That recommendation was given effect by a resolution passed by the Council on 15 February 2005. The present proceeding was filed on 24 February 2005, the existing leases having been due to expire on 31 March 2005. [50] In fairness to Mr Laurenson, the allegation of actual bias was not put so starkly in argument. Rather, Mr Laurenson argued that the decision was made for an improper purpose, namely to grant a lease over reserve land in circumstances in which the Council knew that was inappropriate or unlawful. He relies upon that allegation to found an argument of actual bias. [51] In my view, the allegation of actual bias cannot be sustained. No bad faith can be discerned. No deliberate decision to act on a known error of law exists. The Council acted, at all material times, on the basis of reports from its officials which set out, in clear terms, the steps to be taken to conduct an inquiry into whether leases ought to be granted. Whether the steps set out in the officials' papers to Council represented an accurate view of the relevant law is a separate issue. [52] That leads to the issue of apparent bias. There have been many cases recently which have touched on this issue, notably Auckland Casino Ltd v Casino Control Authority [1995] 1 NZLR 142 (CA), Riverside Casino Ltd v Moxon [2001] 2 NZLR 78 (CA) and Man O'War Station Ltd v Auckland City Council (Judgment No. 1)[2002] 3 NZLR 577 (PC). Those authorities followed R v Gough [1993] AC 646 (HL). The test is whether an informed and objective bystander would consider that there was a real danger of bias on the part of the decision-maker: Riverside Casino Ltd at 87, paras [28] and [29]. Although, in Man O'War Station Ltd at 583, para [10], the Privy Council noted a difference of approach on this issue from thatpertaining in other jurisdictions, I apply the established test. Any departure from that test would, I think, be for the Supreme Court to determine. [53] In performing its role as decision-maker, the Council was faced with the inevitable conflict of interest which flowed from the delegation of Ministerial powers to the Council. The nature of that conflict is set out at paras [24] to [26] above. [54] Mr Laurenson acknowledged that the Council was a democratically elected body that, in some circumstances, is given greater tolerance in its decision making than a judicial body. However, he submitted that the Council's role as a trustee (s26A of the Act), the need to exercise a delegated power as if it were the Minister and the nature of the s73(3) inquiry meant that no tolerance of that type should be afforded to the Council's decision. [55] Mr Laurenson referred me to a number of cases in which allegations of apparent bias had been rejected notwithstanding the fact that members of the decision making body had interests which might be affected by its decision. Many of those cases involve decisions by bodies regulating particular industries and resolving disputes among participants in those fields: e.g. Jeffs v New Zealand Dairy Production Marketing Board [1967] NZLR 1057 (PC) and NZI Financial Corporation Ltd v New Zealand Kiwifruit Authority [1986] 1 NZLR 159 (High Court). [56] Mr Laurenson submits that apparent bias exists because it was open to the Council to decline to exercise its decision making power and to leave it to the Minister. [57] Mr Laurenson's submission that the Council had a closed mind to the reissue of leases is based on five distinct factors: a) An historical predisposition to supporting reissue of leases. That predisposition is said to be evident from Council documentation commencing from, at the latest, 1992 and continuing until 2002.b) The Council's resolution of 6 March 2002 by which it resolved that new lease documentation be prepared and offered to the 26 bach holders six months before the expiry of the existing leases. c) A predisposition towards the issue of the leases that was held by some elected members of the Council and some officials. d) A course of conduct subsequent to the resolution of 6 March 2002 that i) was driven by the Council's intention to exercise its delegated powers under s73(3); and ii) excluded a consideration of the wider purposes and objectives of the Act. e) The Council misdirected itself in respect of the second criterion in s73(3). It is submitted that this misdirection arose out of the influences that caused a closed mind to exist. [58] Many of those criticisms suggest actual bias, in the sense of coming to a decision with a closed mind. In the context of an allegation of apparent bias, the question is whether an objective and informed bystander would think there was a real danger that the Council was not acting impartially in its decision making functions. [59] Mr Laing submits that the allegations of apparent bias cannot be sustained. In reliance on Wellington City Council v Woolworths New Zealand Ltd (No. 2)[1996] 2 NZLR 537 (CA), Lovelock v Waitakere City Council [1996] 3 NZLR 310 (CA) and South Taranaki Energy Users Association Inc v South Taranaki District Court (High Court, New Plymouth, CP 5/97 26 August 1997 Giles J), Mr Laing submits that an approach to the review of decisions made by elected bodies with inevitable political considerations in mind should be approached more cautiously than a challenge, on the grounds of apparent bias, to the decision of a judicial officer.[60] In relation to the specific grounds of complaint, Mr Laing submitted that: a) There was no evidence of predetermination on the part of Council officers b) The reports by Council officials relating to the proposal to grant new leases were comprehensive and provided sufficient information on which Council could make final decisions c) In the period leading up to preparation and finalisation of the new Management Plan, Council officials identified the desirability of revoking the 6 March 2002 resolution and starting afresh with a consideration of relevant factors d) The new Management Plan (particularly policies 5.11.1 and 5.11.2) did not pre-empt the outcome of the leasing decision e) There is no evidence that Councillors involved in the leasing proposal exhibited closed minds during the public processes that led to the decision f) Any Councillors who had expressed views on the desirability of reviewing the leases did not participate in the final decision making process. [61] The question is whether the circumstances disclosed by Mr Laurenson's submissions (as answered by Mr Laing) raise a real danger that a reasonable, objective and informed person would regard the recommendation of the Hearing Commission or the decision of the Council as vitiated by bias. [62] I am satisfied that that test is not met in respect of the membership of the Hearing Commission or the way in which that Commission conducted its hearing. The recommendations made by that Commission were made after due consideration of the submissions made. Whether they applied the right test is a different question. But no objective and informed person could have regarded them as acting partially.[63] I am also satisfied that the circumstances disclosed would not lead a reasonable, objective and informed person to the conclusion that there was a real risk of bias on the part of the Council in reaching its decision. [64] A Council is an elected body that exercises political functions at a local level. It was determining a contentious issue in which matters of public interest arose. In my judgment, an informed and objective bystander would have regarded the procedure as robust but not one giving rise to a danger of bias. [65] While statements supporting the leasing of the reserve land had been made before the hearing and the Council decision, I can see no evidence that would lead an objective and informed observer to the conclusion that the Council was not genuinely reconsidering the issue, having regard to all submissions made to it. [66] While it may have been open to the Council to decline to exercise delegated powers to make a decision on the grant or otherwise of a lease to bach holders (the Minister being better placed to make a decision having regard to the public interest generally, for example issues of public access to foreshore), it is clear that the Council's dual role in considering local and national issues was appreciated by the Minister when the power to make that decision was delegated. In those circumstances, contrary to Mr Laurenson's submission, I am satisfied that the principles enunciated in both Jeffs and NZI Financial Corporation Ltd lead to the conclusion that the conflict did not vitiate the Council's ability to deal with the issue. [67] The claim based on bias is rejected.(b) Interpretation of s73(3)[68] Section 73(3) of the Act provides:(3) Where any recreation reserve or any part of such a reserve is not being used for the purposes of a recreation reserve and in the opinion of the Minister is not likely to be used for that purpose, but it is inadvisable or inexpedient to revoke the reservation, leases of the whole or any part thereof may be granted by the administering body with the prior consent of the Minister in cases where the reserve is vested in such a body, or by the Minister in any other case.[69] Despite everything that has been said and written on the topic, the interpretation issue between Mr Laurenson and Mr Laing reduces to one short point. The question is whether s73(3) can be interpreted as a code providing an exception from the general purposes for which reserve land is to be used? [70] While Mr Laurenson accepted, in reply, that s73 must be regarded as an exception (because it permits the use of a reserve for a purpose other than recreational use) he contended that the Council's decision making was limited both by the phrase "not likely to be used for" the purpose of a recreation reserve and by the extent of the delegation from the Minister under which the Council acted. [71] Mr Laurenson submitted that the delegation limited any lease to two categories. The first was that the delegation must be exercised in accordance with an approved Management Plan for the reserve. The second was that an activity must be existing use, the effects of which will be the same or similar in character, intensity and scale. [72] I deal first with the s73(3) interpretation point. Dealing with each element of that provision: a) There is no dispute that the reserve land on which the baches stand is not presently being used for the purposes of a recreation reserve. b) There is a dispute about whether it was open to the Council, exercising functions delegated by the Minister, to form an opinion that the land on which the baches stand was "not likely to be used for [the] purpose" of a recreation reserve. [73] I agree with Mr Laing that s73(3) must be interpreted as a code dealing with the circumstances in which a Council is entitled to lease reserve land. That is so because the opinion that it "is not likely to be used for recreational purposes" takes account of the purposes for which a reserve is declared and permits a contrary use if that opinion were held and other prerequisites established.[74] In effect, s73(3) entitles the Council to lease reserve land if it were surplusage (in the sense that it is unlikely to be used) or, for example, inaccessible. However, the legislation is, in my view, deliberately phrased not to define exhaustively the circumstances in which the power to lease can be granted. I decline to define the ambit of the power anymore than is necessary to determine this proceeding. [75] Relevantly, s73(4) provides:(4) Before granting any lease under subsection (3) of this section, the administering body shall give public notice in accordance with section 119 of this Act specifying the lease proposed to be granted, and shall give full consideration in accordance with section 120 of this Act to all objections and submissions in relation to the proposal received pursuant to the said section 120.[76] The specific public notification process contained in ss119 and 120 of the Act, are applied by s73(4). The processes articulated in ss119 and 120 of the Act were followed in the present case. The statute, therefore, provides a forum for public participation on contentious issues before the Council forms its s73(3) opinion on the likelihood of the relevant land being used for recreational purposes. [77] The Council formed its view that the land on which the baches stand was unlikely to be used for the purposes of a recreation reserve from submissions made to the Council and empirical evidence it gathered. [78] The empirical evidence included an evaluation of motor and pedestrian traffic at and near the reserve. That evidence was relevant to an assessment of the likelihood that the relevant land would be used for recreational purposes. [79] The Council also called in aid the provisions of Schedule 1 to the Act. The Schedule states the terms a lease must contain if granted under s73(3) of the Act. The Schedule includes a heading "Termination" which, relevantly, provides: If the lessor considers the land is required for the purpose of public recreation, the lease may be terminated on such terms as the Minister approves in any case Mr Laing points out that clause 4.5 of the proposed leases enables the Council to terminate the lease immediately should it be of the opinion that the land is likely to be used for recreation purposes. [80] Mr Laing submits that other terms in the proposed leases assist the Council's decision. They include the need for fences to be set back from the river frontage to permit public pedestrian access to the foreshore. [81] Mr Laurenson's point is that, if the baches were to be removed (as contemplated by the 1975 leases), it is self-evident that those people who come to the reserve would walk over it and use it for recreation purposes. In those circumstances, he submits that the Council could not properly have formed the opinion that the reserve was not likely to be used for recreation purposes. [82] At one level, Mr Laurenson's submission is unanswerable. It cannot be disputed that people who walk over the land in question may also picnic there or lay on the land for the purpose of sunbathing. It cannot be disputed that a person who, for example, comes to the reserve with his or her family for a barbecue or picnic, is likely to walk over the bare land currently covered by the baches. [83] The real issue in this case is whether that degree of use was intended by Parliament to prevent the Minister (or his or her delegate) from concluding that the land in issue was not likely to be used for recreation purposes. If Mr Laurenson's submission were right, the scope of the power to lease would be severely curtailed, perhaps being limited to cases where recreation reserve land is completely inaccessible to members of the general public or something equally unusual. [84] While there is an initial attraction in Mr Laurenson's argument, I am persuaded that the broader interpretation, for which Mr Laing advocates, is more consistent with the scheme of s73. [85] The marginal note to s73 (which I am entitled to take into account by s5(2) and (3) Interpretation Act 1999) states that the section deals with:Leasing of recreation reserves for farming, grazing, afforestation, or other purposes.See also the heading to the relevant sub-part of the Act: "Farming and other leases". [86] Farming or grazing is dealt with by s73(1). The threshold for determining whether to lease for either of those purposes is that the reserve is not for the time being required for the purpose for which it was classified. Alternatively, if the Minister considered it in the public interest or the administering body decided it was necessary or desirable to farm or graze the reserve, a lease could be issued. [87] Section 73(2) deals with afforestation. The threshold test is a decision by the administering body that "it is necessary or desirable to afforest any part of a recreation reserve". Section 73(3) deals with the "other purposes" to which the marginal note refers. [88] Before the Minister (or his or her delegate) decides to lease land under s73, the process articulated in ss119 and 120 of the Act must be followed. That process applies equally to all leases under s73(1), (2) and (3). Similarly, s73(3A) applies equally to all three types of leases. It is s73(3A)(a) that requires a lease of a reserve to be subject to the provisions set out in Schedule 1 to the Act. [89] A decision to lease part of a reserve falls to be considered in the context of the primary need to use reserve land for public purposes. A lease can be granted if the land were unlikely to be used as a reserve in the short or long term. Concerns about the use of the land as a reserve in the short term can be met by a lease that entitles prompt termination at the behest of the Council should circumstances change. A provision to that effect is in the relevant leases. [90] The ability for an administering authority to determine a lease promptly, in changed circumstances, suggests that the de minimis principle must apply in forming the Council's opinion that the land is unlikely to be used as a reserve. Put simply, uses that are unlikely to affect in any real and material way the ability of members of the public to use the reserve for recreational purposes should be ignored when a decision to lease is made. In this case, the term of the new leases requiring changesto permit pedestrian access over the riverbank area is likely to minimise further the present inability of the public in their use of the reserve land. [91] The assessment of whether it is likely that the relevant land will be used for recreational purposes is an opinion. It is an opinion in the nature of a prediction or forecast rather than a proved fact. In this case, if Mr Laurenson's argument were correct, only one opinion would have been open to the Council. [92] In my view it was open to the Council to form an opinion that the land on which the baches stand was unlikely to be used as a reserve in the short term. That opinion was open because, if Mr Laurenson's argument were taken to its logical extreme, a situation could arise in which any potential use (no matter how small) of the land for reserve purposes would prevent the Council from leasing relevant land. In my view, the statute does not suggest that Parliament intended that result. The Council was entitled to bring a sense of proportion to its decision-making. [93] Another distinction that Mr Laurenson seeks to draw is between the concepts of likelihood of non-use as a reserve (on the one hand) and requirement for use as a reserve (on the other): see paras [38] and [40] above. The first is a statutory criterion, the second is not. He submits that the Council, in error, applied the second. [94] I do not consider that the references to land being "required" for reserve purposes (as opposed to likelihood of use) vitiates the decision. The empirical evidence gathered and considered was relevant to both points. In substance, I am satisfied the Council focussed on likelihood when forming its s73(3) opinion. [95] The decision to lease the land to bach holders was open to the Council. It was made on the basis of an evaluation of expected motor and pedestrian traffic in the area. It was made on the basis that, if circumstances were to change, prompt termination of the leases could be achieved to revert the land to public use. The decision allowed for a public walkway to be created along the riverbank area. The decision was one that confirmed the existing private use of baches situated on reserve land, subject to the right to terminate the leases at short notice.[96] In those circumstances, this point must be determined against Mr Gibbs.(c) Did the Council act unlawfully?[97] The submission that the Council acted unlawfully can only be sustained if it acted in error in granting a lease under s73(3). [98] In my view, there is no wider basis for the submission that the Council acted unlawfully. That is because the question whether the Council was required to take account of the Long Title and s3 of the Act is an issue encompassed within the general interpretation of s73(3). [99] On that basis, this part of the claim must also fail.(d) Wednesbury unreasonableness[100] I deal, under this heading, with both irrationality and the taking into account of irrelevant factors and the failure to take account of relevant factors. [101] Wednesbury unreasonableness is submitted to arise from a failure to apply s73(3) properly. I have already held against Mr Gibbs on that issue. For that reason, the relevance (if any) of the opinion of Reeves Middleton Young of March 1996 cannot assist the plaintiff. [102] Nor did the Council take into account irrelevant factors or fail to take account of relevant factors. The Council considered the various questions arising out of s73(3) and answered them in a manner which was open to them on the evidence. [103] Accordingly, there is no basis to interfere with the Council's decision on this ground.Result[104] For the reasons given, the application for judicial review is dismissed.[105] I reserve the question of costs. [106] I do not dismiss the claim in its entirety as there are issues of costs arising out of earlier proceedings that will need to be dealt with contemporaneously with the question of costs on this claim. [107] I direct the Registrar to allocate a telephone conference before me on the first available date after 31 March 2006 for the purpose of discussing with counsel the best way to deal with outstanding issues. [108] Two options are open. Written memoranda can be exchanged and any decision given on the papers. Alternatively, a half day hearing could be allocated in New Plymouth. [109] If there were likely to be evidence on the cause of action dealing with costs in earlier proceedings, a hearing will need to be arranged and an estimate of the time required for a hearing provided by counsel. [110] I thank counsel for their assistance. __________________________ P R Heath J Delivered at 4.30pm on 15 March 2006