WAITAKERE CITY COUNCIL AND ANOR V BENNETT AND ORS CA CA01/2008

WAITAKERE CITY COUNCIL AND ANOR V BENNETT AND ORS CA CA01/2008 22 October 2008IN THE COURT OF APPEAL OF NEW ZEALAND CA01/2008 [2008] NZCA 428BETWEEN WAITAKERE CITY COUNCIL WAITAKERE PROPERTIES LIMITED Appellants AND JANICE AILEEN BENNETT GILLIAN MADGE CLARK ROSALIE HILDA MAITLAND Respondents Hearing: 24 April 2008 Court: Baragwanath, Randerson and Priestley JJ Counsel: M E Casey QC and G R Milner-White for Appellants C R Carruthers QC and P Cassin for Respondent Judgment: 22 October 2008 at 3pmJUDGMENT OF THE COURT A The appeal is dismissed. B The appellants are jointly and severally liable to pay the respondents costs of $6,000 and usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Randerson J)Table of ContentsPara NoIntroduction [1]The issue [6]The facts as summarised in the statement of claim [11]The decisions in the High Court [14]The 1928 Act [22]The 1981 Act [27]The meaning of "held for any public work" [39]The retrospectivity argument [50]Hood v Attorney-General [68]Other issues raised by the appellants [76]The relationship between the powers available to a government orlocal authority under the Public Works Act 1928 and the Harbours Act 1950 [78]The Auckland Harbour Board and Waitemata City Council (Te Atatu) Empowering Act 1983 [93]Conclusion [95]Result [97]Introduction[1] This appeal from the judgment of Williams J (HC AK CIV 2005-404-7348 14 May 2006) is concerned with land at Te Atatu acquired by the Auckland Harbour Board in the 1950s for the development of port facilities which have never eventuated. [2] The land was acquired under the Public Works Act 1928 from the late Frederick John Smith. Some of the land has since been sold but the remainder is now held by one or both of the respondents, the Waitakere City Council and its trading subsidiary Waitakere Properties Ltd. Those bodies are the successors of the Auckland Harbour Board following the reorganisation of local government in 1989. [3] The respondents are the successors of the late Mr Smith. They claim to be entitled to have the remaining land offered back to them under s 40 Public Works Act 1981, which came into force on 1 February 1982.[4] Strike-out proceedings brought by the appellants were dismissed by Associate Judge Faire in the High Court and his decision was confirmed by Williams J on review. [5] We will refer to the Public Works Acts as the 1928 Act and the 1981 Act respectively.The issue[6] In order to understand the essential issue on appeal it is necessary to set out s 40 as it stood when the 1981 Act came into force:40. Disposal to former owner of land not required for public work –(1) Where any land held under this or any other Act or in any other manner for any public work— (a) Is no longer required for that public work; and (b) Is not required for any essential work; and (c) Is not required for any exchange under section 105 of this Act— the Commissioner of Works or local authority, as the case may be, shall endeavour to sell the land in accordance with subsection (2) of this section, if that subsection is applicable to that land. (2) Except as provided in subsection (4) of this section, the Commissioner or local authority shall, unless he or it considers that it would be impractical, unreasonable, or unfair to do so, offer to sell the land by private contract to the person from whom the land was acquired or to the successor of that person, at a price fixed by a registered valuer, or, if the parties so agree, at a price to be determined by the Land Valuation Tribunal. (3) Subsection (2) of this section shall only apply in respect of land that was acquired or taken— (a) Before the commencement of this Part of this Act; or (b) For an essential work after the commencement of this Part of this Act. (4) Where the Commissioner or local authority believes on reasonable grounds that, because of the size, shape, or situation of the land he or it could not expect to sell the land to any person who did not own land adjacent to the land to be sold, the land may be sold to an owner of adjacent land at a price negotiated between the parties. (5) For the purposes of this section, the term "successor", in relation to any person, means the person who would have been entitled to the land under the will or intestacy of that person had he owned the land at the date of his death; and, in any case where part of a person's land was acquired or taken, includes the successor in title of that person.[7] Mr Casey QC, on behalf of the appellants, submitted that s 40 of the 1981 Act was not intended to have retrospective effect and did not apply to land which was not held for a public work at the date of commencement of the Act. This submission appeared to assume that if the land was no longer required for a public work that it could not be held for any public work in terms of s 40(1). [8] Mr Carruthers QC, for the respondents, submitted that land does not cease to be held for a public work merely because it is no longer required for that work. The 1981 Act does not operate retrospectively since the factual pre-requisites to the triggering of the offer-back obligation under s 40 have to be assessed at the commencement of the 1981 Act. At that date, the land was still held for a public work but was no longer required for a public work. [9] Since the statement of claim asserts that the land was held for a public work as at 1 February 1982, and in the light of Mr Carruthers' acceptance that the factual position must be judged at 1 February 1982, the issue may be better expressed as Associate Judge Faire succinctly summarised it at [17]:Can land be said to be held for any public work on 1 February 1982 if, at that date, it was not required for any of the matters referred to in (a), (b) and (c) of s 40(1) of the Public Works Act 1971?[10] We record that, at the hearing before us, Mr Casey abandoned any argument of implied repeal based on the enactment of the Auckland Harbour Board and Waitemata City Council (Te Atatu) Empowering Act 1983.The facts as summarised in the statement of claim[11] For strike-out purposes, the allegations in the statement of claim are assumed to be admitted or to be capable of proof. It follows that, for present purposes, the Court is bound to accept the assertions of fact contained in the statement of claim. In chronological order, the relevant facts pleaded are: 25 October 1949 The Harbour Board notified in the New Zealand Gazette a scheme of development for the subject land under s 29(2)Finance Act (No 3) 1944. The terms of the development were:"The development of the area for the purposes of providing port facilities, land for shipping, industrial and commercial purposes, and access thereto including in particular – 1. The reclamation of tidal lands. 2. Construction of breastworks, wharves, docks, and other harbour works. 3. The subdivision or re-subdivision of lands, laying out and construction of roads, streets, and other means of access. 4. Dredging of channels and basins. 5. Provision of areas for industrial works."The Gazette notice applied to Mr Smith's land which originally comprised two titles having a total land area of approximately 51 acres. The Gazette notice specified that it was to remain in force until 25 October 1964. 19 December 1950 The Auckland Harbour Board resolved to proceed with the acquisition of lands affected by the Gazette notice including Mr Smith's land. 4 September 1951 Mr Smith's land was acquired by the Harbour Board under the 1928 Act against the background that, if agreement were not reached, the land would be taken compulsorily. Between 1967 and 1973 Part of the original land was sold by the Harbour Board, reducing the land area to approximately 19 hectares. 1977 The Harbours Act 1950 was amended to provide that Harbour Boards could not sell or subdivide land taken oracquired under the 1928 Act except in accordance with the provisions of that Act. 1 February 1982 The 1981 Act commenced. By that date it is accepted that the remaining land was "not required for the public work for which it was acquired". 1989 The Waitakere City Council became responsible for the exercise of the Harbour Board's obligations. 1996 The balance of the land was sold to Waitakere Properties Ltd, which has since subdivided the remaining land into residential sections. Some of these have since been sold and some of the land has been transferred back to the Waitakere City Council. [12] The essence of the respondents' claim is set out in paras 13 and 14 of the statement of claim:13. AHB was as a result under a statutory obligation in terms of s 40 PWA to offer to sell the Balance Land to the plaintiffs as successors of the Deceased, such obligation arising on 1 February 1982, because – 13.1 the Balance Land was held by AHB either under the PWA or alternatively, in some other manner for a public work; and 13.2 the Balance Land was no longer required for the public work for which it was acquired; and 13.3 the Balance Land was not required for any "essential work" as then defined by the PWA; and 13.4 the Balance Land was not required for an exchange under s 105 PWA; and 13.5 it was not impractical, unreasonable, or unfair to offer to sell the Balance Land to the plaintiffs as successors of the Deceased. 13.6 there had been no significant change in the character of the Balance Land for the purposes of the public work for which it was acquired or held.14. A reasonable time for AHB to comply with the statutory procedure in s 40 PWA was 18 months. Accordingly, AHB should have made an offer to sell the Balance Land to the plaintiffs as successors of the Deceased by 1 August 1983.[13] The respondents seek a declaration that the Waitakere City Council promptly offer the remaining land for sale to them at a price to be fixed as at 1 August 1983. There are also additional causes of action for damages against both the Waitakere City Council and Waitakere Properties Ltd for alleged breaches of statutory duties or negligence by failing to protect the respondents' rights to have the land offered back to them.The decisions in the High Court[14] Both Judge Faire and Williams J focused on s 40 in its current form although reference was made to the amendments introduced since the commencement of the 1981 Act. We propose to focus on s 40 as introduced because the respondents' claim is that the obligation to offer the land back to them arose upon the commencement of the Act. [15] Judge Faire concluded at [39] that:... when the text is analysed, the land can still be classified as being held for public works even where it is no longer required for public works. In short, the two positions are not mutually exclusive. Indeed, when s 40 is broken down into its constituent elements, as I have set out in [33] of this judgment, it is clear that, for the section to apply, land must be both held for a public work and, at the same time, be no longer required for that public work.[16] Judge Faire also concluded that the presumption against the retrospective effect of legislation did not override the clear intention of s 40 to require land to be offered back where the conditions of s 40 were satisfied. [17] In upholding Judge Faire's decision, Williams J found at [43] that:Perusal of the Parliamentary debate on the 1981 Bill shows that, even in its original form, s 40 was intended to terminate the "land banking" which had occurred on the part of local authorities since the 1928 Act and to require them to sell land so "land banked" back to those from whom it had been acquired or their successors if the s 40 criteria applied.[18] The Judge accepted at [48] that:...the essence of the first prerequisite is that to trigger the offer back obligation, the local authority must be retaining ownership of the land and must be held for a public work.[19] He further found at [49] that:The second qualification is that the land "is no longer required" for that or any other public work or for exchange.[20] After reviewing the statutory history, relevant parliamentary materials and judicial authorities, the Judge concluded:[81] Section 40 was construed earlier solely on the basis of its terminology. It is now pertinent to consider whether that construction is altered by the issues discussed in this judgment to this point. [82] They show - though judicial descriptions of the rights of former owners and their successors vary - a first option to repurchase, a right of pre- emption, an inchoate right coming into effect once the land is no longer required for a public work. All agree that Parliament's intention in enacting s 40 was to ensure that those holding land acquired for public purposes but now surplus to such purposes were bound by an obligation to offer the land back to former owners or their successors by means of the mechanism detailed in s 40. That such was the policy was particularly emphasised inPort Gisborne [Ltd v Smiler [1999] 2 NZLR 695 (CA)] and [Attorney- General v] Hull [[2000] 3 NZLR 63 (CA)] in the passages earlier cited. The obligation enures even if the land had only not been held for a public purpose for a period ([Attorney-General v Horton [[1999] 2 NZLR 257 (PC)]). Notably, ascertainment of the current market value of the land must be at the date of the valid offer back, the date when such should have occurred if the local authority acted "timeously and with due expedition" (McLennan [v Attorney-General [1999] 2 NZLR 469 (HC)]at first instance). [83] The authorities demonstrate there are limitations on that broad principle. Only those from whom the land was acquired for a public work or their successors are entitled to an offer back: if the land was not acquired for a public work, later use for a public work purpose does not create an offer back obligation (Port Gisborne at 37, 40). A factual enquiry must be undertaken as to when the land was no longer required for a public work ([Attorney-General v] Morrison [[2002] 3 NZLR 373 (CA)] at 41) but since, on a review application such as this, the Court is required to treat all allegations in the statement of claim as provable, that is not an issue which can arise in the present case. Similarly, an investigation needs to be undertaken, if offer back to former owners is to be avoided, as to whether it is impracticable, unreasonable or unfair for the land to be offered back. But that question, too, does not arise on this review for the reasons just mentioned, although it is to be noted that in Hood [v Attorney-GeneralCA16/04 2 March 2005], at para [97] the Court of Appeal said there must be "good reason for these interests to be disregarded".[84] And while the Supreme Court in Hood (at para [7]) may have sounded a cautionary note as to the correct date on which s 40 was to be applied, including the date the section came into force, it made no finding in that regard because it was not an issue on the leave application and accordingly should be put to one side. [85] Seen in that light, all those cases are glosses, qualifications on the coherence of s 40 and illustrations of its application. As earlier described, from the terms of the section itself, it applies in all circumstances where at any time land has been acquired by any local authority for a public work and where at some stage during the local authority's ownership the land is "no longer" required – the continuous present lasting for the whole of the period it is not required – for that or any other public work. That triggers an obligation to "endeavour to sell the land" in accordance with s 40(2) or the remaining provisions of the section. The change of tenses in s 40(2)(b) – the public work for which "it was acquired or is held" – merely reflects the possibility of change in the public work purposes for the land between acquisition and the date the owner is required to consider whether there "has been a significant change in the character of the land". [86] All of that is consistent and coherent and does no damage to the plain words of s 40, especially s 40(1). Mr Casey submitted, for the reasons outlined earlier, that the 1981 Act could not apply to the land the subject of this claim because the land was, at 1 February 1982, already held for a public work and was already no longer required for that or any other public work. However, that submission runs counter to the terms of the section and the Parliamentary policy underlying it and there is no reason to suppose that Parliament did not intend to create rights and obligations on local authorities and on former landowners and their successors which came into force contemporaneously with the Act coming into force.[21] Williams J did not consider the section was operating retrospectively. He noted that statutory changes frequently altered pre-existing rights and obligations and concluded:[88] The same is true of s 40. On 31 January 1982, local authorities and former owners had only the rights and obligations in the 1928 Act (as amended). On and from 1 February 1982, their rights and obligation were as set out in s 40. Had a local authority acted in accordance with the 1928 Act and satisfied its obligations on or before 31 January 1982, former owners could have had no objection that their rights may have been increased the day the 1982 Act came into force. [89] In this case, according to the statement of claim, on 1 February 1982 Waitakere City held the land the subject of this litigation, having acquired it through the succession earlier described. By that date it no longer required the land for the original or any other public purpose or for exchange and accordingly, in terms of s 40 and McLennan, it was obliged "timeously and with due expedition" to set the offer back provisions of s 40 in train. According to the statement of claim, it failed in that regard. That may ultimately result in what the defendants see as a windfall for the plaintiffs but, in the Court's view, that result would nonetheless conform to Parliament's intention as expressed in s 40.The 1928 Act[22] Legislation on the subject of public works has existed in New Zealand since at least 1876 but an examination of the legislation prior to 1928 does not assist the points at issue in this appeal. Under the 1928 Act, s 35 corresponded to the current s 40. When first enacted, s 35 provided:35. Land not wanted may be sold &c.—If it is found that any land held, taken, purchased, or acquired at any time under this or any other Act or Provincial Ordinance, or otherwise howsoever, for any public work is not required for such public work, the Governor- General may, by an Order in Council publicly notified and gazetted, cause the same to be sold under the following conditions:– (a) A recommendation or memorial, as the case may be, as provided by section twenty-three hereof shall be laid before the Governor-General by the Minister or local authority at whose instance the land was taken describing so much of the said lands as are not required for such public work, accompanied by a map thereof certified by the Surveyor- General or an authorized surveyor appointed by him in that behalf, and setting forth the reasons for disposing of the same: (b) The Minister or local authority, as the case may be, shall cause the land proposed to be sold by one or more competent valuers, and shall offer such land at the price fixed by such valuation – first, to the person then entitled to the land from which such land was originally taken; and, if he refuses it or cannot after due inquiry be found, then to the owner of the adjacent lands, or, if there is more than one such owner, then to each of such owners in such order as the Minister or local authority thinks fit; and, if no such owner accepts such offer, may cause the land to be sold by public auction: Provided that the Governor-General may without complying with any of the last foregoing provisions sell by private contract or grant to any Education Board any lands taken for Government works, and may execute such grants, conveyances, and assurances as may be necessary to give effect to such sale or grant: Provided also that in the case of any land so taken, purchased, or acquired for a Government work and not required for that purpose, the Governor- General may, on such recommendation as aforesaid and without complying with any other requirements of this section, by Proclamation declare such land to be Crown land, subject to the Land Act, 1924, and thereupon the land may be administer and disposed of under that Act accordingly.[23] In contrast to the 1981 Act, there was no mandatory obligation to offer land back when it was not required for the public work for which it had been acquired.However if it were decided to sell the land, an obligation arose to offer it first "to the person then entitled to the land from which such land was originally taken". If the person refused to accept the offer or could not be found, the land was to be offered to the owner of the adjacent land. If the offer was not accepted by the adjacent owner, the land could be sold by public auction. There were two provisos to this requirement. The first enabled land taken for Government works to be sold or granted to any Education Board and the second enabled the Governor-General to declare land taken for a Government work to be Crown land subject to the Land Act 1924. [24] By s 20 Public Works Amendment Act 1952, a local authority could change the purpose for which the land was acquired or taken to some other purpose for which the local authority was authorised to acquire land under the principal Act. But in that event, the local authority was required to follow a formal process of Gazettenotice and proclamation. [25] By s 4(1) Public Works Amendment Act 1954, s 35 was amended to remove the obligation to offer the land first to the person from whom the land was originally taken or the successor to that person. Under the amendment, the land could be sold either by private contract to the owner of any adjacent land or by public auction or tender. Section 35 remained in that form until the 1928 Act was repealed and substituted by the 1981 Act. [26] Later in this judgment, we review other provisions of the Public Works 1928 relating to the powers available to lease or subdivide land acquired or taken under that Act.The 1981 Act[27] There can be no doubt that the 1981 Act was intended to be remedial (as reflected by s 5(j) Acts Interpretation Act 1924). The Bill as introduced proposed in clause 39 (which became s 40) that the Governor-General "may" consent to land no longer required for a public work being sold, and "may" sell it to "the person from whom the land was acquired or to the descendant or successor in title of that person".[28] A key change recommended by the Select Committee was, for the first time, to require government or local authorities to endeavour to sell land acquired or taken for a public work to the person from whom it was acquired (or their successor) when the land was no longer required for a public work. [29] Clearly, Parliament intended to limit the power of the Crown to appropriate land and to restore greater rights to individual property owners. Concern was also expressed about the practice of land-banking. [30] As the then Minister for Works and Development the Hon W L Young explained:One of the most significant of the changes that have been recommended is the rewriting of clause 39. That clause will now give effect to the general principle that when land has been acquired by the Government or by a local authority for a public work, and subsequently ceases to be required for a public work in respect of which there is a power of compulsory acquisition, the land should be offered back to the original owner, or his representative, except in circumstances when there was no element of compulsion at the time the land was originally acquired. If land becomes surplus to the work in respect of which it was acquired, but is required for another essential work, it may be set apart for that work without being offered back to its former owner. In such cases, however, the former owner is declared to have standing for the purpose of making an objection to, or appeal against, any application that might arise under the Town and Country Planning Act. (2 September 1981) 440 NZPD 3165.[31] The issue of land-banking was discussed by a Government MP of the day, Mr L C Schultz:In times gone by, local authorities, and sometimes Government departments, have taken land and put it aside into a land bank for use at some time in the future. That can no longer happen. When notices are issued to land owners there must now be much more information so that the owner knows exactly where he is and what rights he has. When land is taken – and sometimes a complete block of land has to be purchased – the owner will have the right to get it back again if it is not all used or if the local authority or Government department no longer requires it. It cannot be transferred for any other use and cannot be put into a land bank, but must be used for the specific purpose for which it was taken. (2 September 1981) 440 NZPD 3180.[32] When enacted, s 40 no longer included the phrase adopted in s 35 of the 1928 Act "any land held, taken, purchased or acquired at any time ...". Rather, it used the simple phrase "any land held ... for any public work". [33] Despite that difference, it has been held by this Court that s 40 is directed to the acquisition of land for public works and continues to apply to land acquired or taken from a private person for public work purposes under compulsion or at least against a background of compulsion: Port Gisborne Ltd v Smiler [1999] 2 NZLR 695 at [35] (CA). This is evident from the terms of s 40(3) which uses the expression "land that was acquired or taken". The rationale was said to be that it is only fair, if the public work purpose disappears, that the land should, so far as practicable, revert to the previous or equivalent private ownership. [34] This Court also said in the Port Gisborne case at [35] that:The Act clearly has no application to land which has been acquired, and is currently being used, for purposes other than public work.[35] It is common ground that the 1981 Act applies to land acquired or taken before the commencement of the 1981 Act: s 40(3). It is also accepted that the Harbour Board was a local authority under both the 1928 and 1981 Acts. [36] Mr Casey correctly submitted that the offer-back rights asserted in this case would not be triggered under s 40 as first enacted unless the respondent could demonstrate that at 1 February 1982: (a) The land was held under the 1981 Act or any other Act or in any other manner for any public work; and (b) (i) Was no longer required for that public work; and(ii) Was not required for any essential work; and (iii) Was not required for any exchange under s 105 of the Act. [37] If all these matters could be demonstrated, then prima facie the offer-back obligation is triggered subject to:(a) Any determination under s 40(2), if applicable, that it would be impracticable, unreasonable, or unfair to offer the land to the person from whom it was acquired or that person's successor; and (b) A belief on reasonable grounds on the part of the relevant authority under s 40(4) that, because of the size, shape or situation of the land, the authority could not expect to sell the land to any person except an adjacent owner. [38] Focusing on the two prerequisites described in [36] above it is accepted in the statement of claim that by 1 February 1982, the land was no longer required for the public work (port facilities) for which the land had been acquired or for any other public work or for exchange. It is also accepted that the land had not been required for the purpose for which it was acquired for some time prior to that date. However the question is whether, in the circumstances pleaded, the land can still be regarded as "held ... for any public work" at that date in terms of s 40(1).The meaning of "held ... for any public work"[39] The starting point in the circumstances of this case is that the respondents must establish that the land was "held ... for any public work" when the 1981 Act commenced. If this cannot be established the claim must fail at the outset. [40] The expression "held" in s 40(1) obviously requires proof that the government or local authority still owns (or controls the ownership of) the subject land. To "hold" land in the sense used in s 40 denotes a continuing state of affairs. In the present case, that state of affairs must be shown to exist on and after 1 February 1982. It must of course also be demonstrated at the same date that the land was "held ... for any public work". As we later conclude, that public work need not be the public work for which the land was originally acquired since s 40(1) refers to "any public work". [41] Mr Casey submitted that, since it was accepted the land was not required for any public work as at 1 February 1982 (and had not been so required for some timeprior to that date), the land could not have been "held ... for any public work" at that date. The initial difficulty with the appellants' contention is that the statement of claim asserts that it was so held and, for strike-out purposes, it is not open to us to challenge that assertion of fact. [42] Whether the subject land is "held ... for any public work" at the relevant date is essentially a question of fact and may be a matter of some complexity. InAttorney-General v Hull [2000] 3 NZLR 63 (CA) , this Court held at [41] that whether land was no longer required for the purpose for which it was taken was a question of fact involving an assessment of intention in the light of objective circumstances. Similar considerations apply to determining whether the land is "held ... for any public work". [43] A determination on this issue will require an investigation of all evidence bearing upon the purpose for which the land was originally acquired; how this was documented in any relevant proclamations, memorials, resolutions, land titles or other written material; and the evidence as to what has since occurred. It will also involve a consideration of the statutory powers and duties of the Harbour Board during the relevant period under the 1928 Act, the Harbours Act 1950 and any other relevant legislation. The nature and effect of those statutory powers was canvassed in argument before us and we deal with the submissions on that subject later in this judgment. [44] We accept Mr Casey's submission that the use of the expression "no longer" in s 40(1)(a) suggests a temporal sequence in the sense that s 40(1) clearly applies to land which at 1 February 1982 (or at some later time) is "held ... for any public work" but which thereafter becomes no longer required for that public work. [45] But it does not follow from the mere fact that land may no longer be required for a public work that it is no longer "held ... for any public work" under s 40(1). The two elements ("held ... for any public work" and "no longer required" for any of the purposes in s 40(1)(a), (b) or (c)) are not mutually exclusive and both may exist simultaneously. As we have indicated above, the status of the land at the relevant date is a complex issue of fact. Depending on the result of the required analysis, theland may simultaneously continue to be "held ... for any public work" while no longer being required for that purpose. [46] That result could follow when the factual inquiry demonstrates that land was acquired or taken for a particular public work and an examination of the formal documents or other materials shows that the land has continued to be held for that purpose even though no steps have been taken to implement the public work. That conclusion might be reached, for example, on the basis that a change of the status of the land required some formal step to be taken which had not occurred. Or, as Mr Carruthers suggested, the powers of the relevant authority may be such as to preclude or limit the ability of the authority to change the status of the land. [47] While we accept that the land may have become no longer required for any of the purposes in s 40(1)(a), (b) or (c) at a date prior to the commencement of the 1981 Act, that state of affairs must be shown still to exist at the commencement date in a case such as the present since the obligation to offer-back under s 40 could not arise until the 1981 Act came into force. That conclusion is supported by the use of the present tense "is" in each of s 40(1)(a), (b) and (c). In that sense, what has happened previously is no more than evidence bearing upon the facts existing at the commencement date. We refer to this again later when discussing the decision of the Privy Council in Attorney-General v Horton [1999] 2 NZLR 257 (PC). [48] Mr Casey also referred to the changes to s 40 since its enactment. These include an amendment in 1982 which introduced a further discretion in s 40(2)(a) (with effect from 1 November 1982) to enable the relevant authority to avoid the offer-back obligation where there has been "a significant change in the character of the land for the purposes of, or in connection with, the public work for which it was acquired or is held" (emphasis added). We agree with Williams J that the italicised words simply recognise the possibility that there may be a change in the public work subsequent to the original acquisition. It does not cause us to take a different view of the proper construction of s 40 as originally enacted.[49] Similarly, the removal in 1987 of the reference to "essential work" in s 40 is not material to the issue we have to decide. That issue is controlled in this case by s 40 as originally enacted.The retrospectivity argument[50] Mr Casey submitted that if s 40 could be relied upon as the respondents maintain, the section would operate retrospectively. He referred to ss 7 and 17 Interpretation Act 1999 to support his submission that Parliament could not have intended such an outcome. [51] Mr Casey submitted that the 1981 Act was retrospective in effect because it created new and more burdensome obligations upon both government and local authorities in respect of land acquired or taken for public works. He submitted that government or local authorities could have established major buildings on the land or otherwise dealt with the land in a way which would prejudice them if they were required to return the land under s 40. [52] Whether or not a statute has retrospective effect in a way which engages s 7 is not necessarily easy to discern and, as noted in Bennion on Statutory Interpretation (5ed 2007) at 317:... the mere fact that a change is operative with regard to past events does not mean that it is objectionably retrospective. Changes relating to the past are objectionable only if they alter the legal nature of a past act or omission in itself. A change in the law is not objectionable merely because it takes note that a past event has happened, and bases new legal consequences upon it.[53] Mr Casey did not attempt to argue that the 1981 Act only applied to land acquired or taken for public work purposes after its commencement. If the Act is interpreted as meaning that plaintiffs in a case such as this must establish both the prerequisites identified in [36] above at the date the 1981 Act came into force (which we accept), then we do not see that the legislation has retrospective effect. [54] As already indicated, if at the date of commencement of the 1981 Act, the land was not held for any public work, then the s 40 rights are not engaged. Thatcould occur either because the land was sold prior to 1 February 1982 or because, although still in the ownership of the Crown or local authority, it was no longer "held ... for any public work". Section 40 does not reach back to impose new obligations on public authorities when the land is no longer held for any public work. It merely creates new legal obligations where certain factual prerequisites are shown to exist at the date of its commencement. [55] While s 7 creates a presumption against an enactment having retrospective effect, it is always open to Parliament to enact a statute having retrospective operation either expressly or by clear implication. [56] As noted in Professor Burrows' work Statute Law in New Zealand (3ed 2003) at 405:... the matter is one of construction, in which the language of the text, the purpose and scheme of the legislation, and the desirability or otherwise of giving it retrospective effect, will all play their part.[57] If, contrary to our view, s 40 does have retrospective effect, it is clear that Parliament intended, with effect from 1 February 1982, to impose obligations on government and local authorities which had not hitherto existed. At least in part, this was to address the perceived mischief of land-banking and to ensure that land taken compulsorily for public works (or under threat of compulsion) should be handed back to the original owners when it was no longer required for a public work. The application of the 1981 Act to land held for a public work at the date of commencement of the Act has recently been confirmed by Williams J in McElroy v Auckland International Airport Ltd [2008] 3 NZLR 262 at [100]. [58] Finally, as Williams J noted, if the government or local authority has conducted its affairs in such a way as to make it impractical, unreasonable or unfair to do so, it is not obliged to sell the land to the original owner or that person's successor (s 40(2)). [59] Mr Casey also relied on s 17 Interpretation Act 1999 which provides:17 Effect of repeal generally(1) The repeal of an enactment does not affect— (a) The validity, invalidity, effect, or consequences of anything done or suffered: (b) An existing right, interest, title, immunity, or duty: (c) An existing status or capacity: (d) An amendment made by the enactment to another enactment: (e) The previous operation of the enactment or anything done or suffered under it. (2) The repeal of an enactment does not revive— (a) An enactment that has been repealed or a rule of law that has been abolished: (b) Any other thing that is not in force or existing at the time the repeal takes effect.[60] Counsel submitted that, prior to the repeal of the 1928 Act, the Harbour Board had the right to deal with the land without the constraints later introduced by s 40. The question was whether Parliament should be taken as having intended by the enactment of s 40 to affect retrospectively the rights which existed prior to the repeal of the earlier legislation. Mr Casey also submitted that the same question applied to any retrospective effect on the status of the land. [61] Developing this argument, Mr Casey submitted that s 35 of the 1928 Act did not derogate from the grant of the fee simple to the Harbour Board since that section did not impose any obligation to sell the land or to offer it back to the previous owners or their successors. The only constraint on the Board's right to use or deal with the land was under other legislation such as the Harbours Act or the Public Bodies Leases Act. It was submitted that the application of s 17(1)(b) and (c) required an interpretation of s 40 which meant that the existing right or status should not be affected by the repeal of the 1928 Act. [62] Counsel referred to the helpful discussion of Cooke J in Wellington Diocesan Board of Trustees v Wairarapa Market Buildings Ltd [1974] 2 NZLR 562 at 569-571 when discussing the equivalent provision under the Acts Interpretation Act 1924 (s 20(e)(iii)). In that passage, the Court dealt with authorities relating to the existence or otherwise of an accrued right in terms of the relevant provision. Cooke J referred to Abbott v Minister for Lands [1895] AC 425 (PC) where arepealed statute had given a right to holders of lands granted by the Crown to purchase adjoining lands without a residence condition. The Privy Council held that this was not an accrued right. The expression did not cover a mere right (assuming it could properly be so called) existing in any class of members of the community to take advantage of an enactment without any act done by an individual towards availing himself of that right. [63] As Cooke J observed in the Wellington Diocesan case at 571, determining whether a right has accrued under the relevant provision may be one of "great fineness". But we doubt that the ability of the Harbour Board in this case to deal with the land without the constraints introduced subsequently by s 40 amounts to an accrued right for the purposes of s 17 Interpretation Act or its predecessor. Prior to 1 February 1981, the Harbour Board could have taken steps to dispose of the land and, if it had done so, it would have been subject to the statutory constraints then in place under the 1928 Act, the Harbours Act or any other applicable enactment. But it would not have been subject to any obligation (at least from the time the Public Works Amendment Act 1954 was enacted) to offer the land back to the previous owners or their successors. However it did not take any steps to sell the land and, in these circumstances, it does not appear there was any accrued or vested right of the kind contemplated by s 17. The right to sell the land free from the s 40 obligation appears to have been no more than an available right which was not exercised. [64] If we are wrong on this point, we are satisfied for the reasons already given that Parliament intended the 1981 Act to operate in a case such as this. [65] Mr Casey did not develop his argument about the status of the land and we do not see that it adds anything to the submission on this point. [66] Mr Casey also submitted that if s 40 had a retrospective effect, it would also affect the "previous operation" of the enactment in terms of s 17(e). He submitted that a range of possible outcomes could have occurred with the land once it became surplus to public work requirements. There is no evidence before us as to what may have been done with the land since its acquisition. However, if by reason of thelapse of time, the manner in which the Harbour Board or its successors had dealt with the land make it impractical, unreasonable or unfair to require the land to be sold to the previous owners or their successors, s 40(2) may relieve the appellants of such obligation. [67] Finally, counsel referred to the decision of this Court in Waitemata District Health Board v Sisters of Mercy [2002] 3 NZLR 764. The Court in that case was dealing with complex statutory provisions under the Health Sector (Transfers) Act 1993 and a subsequent amendment in 2000 which provided an exemption from the offer-back provisions of s 40 where Hospital Board land was transferred between successive statutory authorities holding the land. As a matter of construction, the provision did not have retrospective effect. Only if it did, would ss 7 and 17 Interpretation Act come into play. That case is clearly distinguishable from the present since it was dealing with specific legislation not in point here.Hood v Attorney-General[68] Mr Casey addressed submissions to us in respect of the decision of this Court in Hood v Attorney-General CA16/04 2 March 2005 which considered the application of s 40 as originally enacted. The case was concerned with land compulsorily acquired in 1960 under the 1928 Act for a public school. In early 1980, the land ceased being used for a school and a playcentre was established in its place. The Hood family claimed that, on the introduction of s 40 on 1 February 1982, the Crown became obliged to offer the land to them under the section. [69] This Court held that the playcentre was not a continuation of the original public work as a public school and neither was the playcentre an essential work in terms of s 2 of the 1981 Act. It followed in this Court's view that the obligation to sell the land in accordance with s 40(2) was triggered, subject to the qualification in that subsection, when the 1981 Act came into force: [46] and [62]. [70] However the Hoods' claim failed because, when the history of dealings between the Crown and the local council was analysed, it would have been unfair and unreasonable in terms of s 40(2) to require the land to be offered back in 1982.[71] Mr Casey submitted that this Court was wrong to have proceeded in that case on the apparent assumption that a change in the original public work at any time prior to 1 February 1982 meant that the land had to be offered back (unless it was an essential work). Mr Casey submitted that Parliament could not have intended such an outcome. [72] Counsel also referred us to [7] in the decision of the Supreme Court declining leave to appeal the Hood decision ([2007] NZRMA 28):In the Courts below and in the argument of counsel it was apparently assumed that the application of s 40 turned on the circumstances at the date the obligation to offer back arose. In the present case that was treated as the date upon which s 40 came into effect, because by that date the land was no longer being used for the purposes of a school. No argument on the correctness of this approach was addressed to us. Our refusal of leave to appeal should not be taken to indicate agreement with it.[73] We do not consider that much should be read into this statement. Nor is it appropriate to consider the transcript of the argument in the Supreme Court on the leave application as counsel suggested we should. All that can be taken from the Supreme Court's observations is that it has not determined the question whether the application of s 40 turns on the circumstances at the date the obligation to offer-back arises. [74] For our part, it is not appropriate to reach a conclusion in the context of a strike-out application about the effect of a change from the original public work to another where such change occurs prior to 1 February 1982. We note however that a local authority was authorised under s 20 Public Works Amendment Act 1952 to change the public work for which the land was originally acquired or taken by the formal process of Gazette notice and proclamation. [75] In these circumstances, it seems at least doubtful that a change from one public work to another prior to 1 February 1982 could cause the s 40 rights to be triggered on or after 1 February 1982. That is because s 40(1) focuses on land held for any public work. The second pre-requisite focuses on the land being no longer required for that public work which refers to the public work for which the land isheld at the commencement of the 1981 Act. That work may not be the same public work for which the land was originally taken or acquired.Other issues raised by the appellants[76] Mr Casey also postulated other factual scenarios which he submitted militated against the interpretation of s 40 relied upon by the respondents. One was the possibility that a local authority could, on the respondents' argument, be required to make an offer-back to the original owners or their successors where, prior to 1 February 1982, there had been a decision that the land was no longer required for a public work but the authority later decided it was. Counsel referred to Horton. In that case, the Privy Council was concerned solely with land acquired after the commencement of the 1981 Act. A decision was made that the land was not required for a public work but it might be so required in the future. The Privy Council upheld the view of this Court that once the essential pre-requisites were established, the rights to an offer-back were triggered and there was no room to reconsider the earlier conclusion that the land was not required for a public work. Counsel submitted that this could work unfairness to the government or local authority where the relevant events occurred prior to the commencement of the 1981 Act, since the authority would not be aware of the legal consequences of its actions. [77] It would be speculative and unwise for us to reach any conclusion on an issue such as this when there is nothing before us to suggest that this factual situation arises in the present case. However, counsel's argument in this respect does not cause us to reach any different conclusion on the proper interpretation and application of s 40 in this case. We reiterate that the statutory focus is on the facts established at the operative date which, in this case, is at the date of commencement of the 1981 Act. What may have happened prior to that is no more than evidence bearing on the existence or otherwise of the necessary prerequisites as at 1 February 1982. As Horton recognises, the position may be different if the land becomes surplus after the 1981 Act has commenced. In that case, the obligation to offer-back could arise immediately, subject to any later defeasance as Horton discusses.The relationship between the powers available to a government or local authority under the Public Works Act 1928 and the Harbours Act 1950[78] In developing the respondents' principal submission, Mr Carruthers submitted that the land could only be held and dealt with in terms of the 1928 Act. The appellants' argument wrongly assumed that if the Harbour Board no longer required the land for the original purpose, it could use it for some other purpose. That was not so in counsel's submission since the powers available under the 1928 Act were very limited. [79] Mr Carruthers submitted that the powers available under the 1928 Act were limited to: (a) Holding the land indefinitely for as long as the 1928 Act remained in force; (b) Selling the land (subject to the restrictions in s 35(1)); (c) Declaring the land to be Crown land subject to the Land Act 1948; (d) Letting the land under s 39 when not required for immediate use for a period of up to 21 years; or (e) Setting the land apart for another public work under s 20 Public Works Amendment Act 1952. [80] In Mr Carruthers' submission, apart from the sale of part of the land between 1967 and 1973, none of the powers listed above had been exercised prior to the commencement of the 1981 Act. It followed, that the balance of the land was still held for a public work at 1 February 1982 even though, by that date, it was no longer required for a public work. [81] There should be added to the list of powers available under the 1928 Act the power introduced by s 37 Public Works Amendment Act 1938 to apply land taken or acquired for a public work to "any secondary use or uses, either public or private, without interfering with the public work for which the land is held...".[82] There was a degree of formality attaching to a formal taking of land under the 1928 Act including the process of notice in the Gazette; the consideration of objections; and the formal proclamation required under ss 22 and 23. Similar formalities were required where a local authority desired to change the purpose for which the land was taken or acquired under s 20 Public Works Amendment Act 1952. [83] These considerations tend to support Mr Carruthers' argument that the powers available to a government or local authority under the 1928 Act were limited in the ways outlined and required a degree of formality in process and documentation if, for example, a change to another public work was proposed. [84] But, as Mr Casey submitted, the Harbour Board had other powers available to it. The Harbours Act 1950 came into force on 15 October 1950 and was therefore operative when the land was acquired in September 1951. In relation to the acquisition of land for "harbour works" (as defined by s 2 Harbours Act), s 140(1)(a) empowered a harbour board to:Acquire by purchase, lease, or otherwise, or take under the provisions of the Public Works Act 1928, any lands, buildings, or easements, or any interest therein required for the purpose of obtaining access to or a frontage to a public road for any foreshore or other land vested in it, or for or in connection with any undertaking which the Board is authorized to carry out:[85] By s 140(3), a harbour board, with the consent of the Minister, was authorised to acquire more land than was required for the proposed work and to sell or lease any surplus area not required for that purpose. This authority to sell or lease surplus areas was repealed by s 26(2) Harbours Amendment Act 1977 which coincided with other significant changes to the powers of harbour boards as we detail below. [86] Harbour boards were also declared to be leasing authorities within the meaning of the Public Bodies' Leases Act 1908 (later the Public Bodies Leases Act 1969), in addition to any leasing powers conferred on a harbour board by any special Act. This provision remained substantially unaltered until the repeal of the Harbours Act in 1999.[87] In 1977 the Harbours Act was amended to enable the subdivision and sale of land vested in harbour boards. These powers were conferred by ss 143B and 143C respectively. By s 143A, these powers could not be exercised without Ministerial approval. As well, s 143A(b) specifically stated that the powers in ss 143B and 143C:Do not authorise a board to deal with land taken or acquired under the Public Works Act 1928 otherwise than in accordance with the provisions of that Act:[88] Section 143A was amended in 1983 so that the requirement for ministerial approval and the restriction relating to dealings with land taken or acquired under the 1928 Act applied only to the sale of land by harbour boards and not to the subdivision of such land. [89] We do not view the powers available under ss 143B and 143C as being excluded where the land was taken or acquired under the 1928 Act. Rather, if a harbour board wished to subdivide or sell land, it could only do so with ministerial approval and in a way which accorded with the requirements of the 1928 Act. Effectively, if a harbour board wished to sell such land, it was obliged to follow the offer process prescribed by the 1928 Act. [90] In addition to these specific powers in relation to land, harbour boards had very extensive powers under s 173 Harbours Act, including the power to construct works, erect buildings, and to grant leases or licences for up to 14 years. [91] This limited review of the legislation demonstrates three things. First, the powers of harbour boards in respect of land acquired or taken under the 1928 Act were not limited to the powers available under that Act. They included the powers otherwise available under the Harbours Act 1950 which was in force during the relevant period. Secondly, land acquired or taken under the 1928 Act could not be sold except in accordance with the processes under s 35 and, from 1977, the Harbours Act provided that harbour boards were only authorised to sell land acquired or taken under the 1928 Act in accordance with that Act and with Ministerial approval. Similar restrictions were imposed in relation to subdivision from 1977 onwards until 1983 (after the 1981 Act commenced). Thirdly, given thewide definition of "public work" in the 1928 Act, there may be only limited scope to establish that the Harbour Board lawfully carried on some work or activity on the subject land which was not a public work. Effectively, a public work was defined as including any work a local authority was authorised by statute to undertake or for which money was appropriated by Parliament. [92] We make these observations to reinforce our conclusion that any decision as to whether the subject land was held for any public work as at the commencement of the 1981 Act will require a consideration of all relevant evidence assessed against the legislative background in force during the relevant period.The Auckland Harbour Board and Waitemata City Council (Te Atatu) Empowering Act 1983[93] This Act was enacted on 2 December 1983. It concerned land on the Te Atatu Peninsula, including the subject land. Under the Act, the Harbour Board was authorised to grant to the (then) Waitemata City Council or any other person a lease or licence to investigate the development of the land. The Act also empowered the Council to promote the development, subdivision and leasing of the land. [94] Mr Casey submitted that Parliament would not have considered enacting this legislation (which could lead to commercial or other development of the land) for non-public works purposes if the land might have been subject to s 40. We do not attach weight to this submission. It is stretching matters to accept that, when enacting the legislation, Parliament must have considered whether or not the land was subject to possible offer-back obligations under s 40. It is equally likely that the issue was simply overlooked. No evidence has been produced to suggest that Parliament turned its mind to the issue at all.Conclusion[95] In summary: (a) Section 40 Public Works Act 1981 applies to land acquired or taken prior to the commencement of the 1981 Act. (b) For the purposes of this case as pleaded, the respondents must initially satisfy two pre-requisites under s 40 Public Works Act 1981 as originally enacted: (i) That, at 1 February 1982, the land was held for any public work; and (ii) At that date, the land was no longer required for that public work, or for any essential work, or for exchange under s 105 of the Act. (c) The fact that the land is no longer required for a public work does not preclude the possibility that the land may be held for a public work in terms of s 40. (d) Whether land is held for any public work as at 1 February 1982 is a question of fact requiring consideration of all the evidence bearing on that issue against the relevant statutory background. (e) Since the statement of claim asserts that the land was held for a public work as at 1 February 1982, that fact must be accepted for strike-out purposes. [96] Nothing in this judgment should be taken as expressing any view on the substantive merits of the case or on any other issues which may arise including any issues of limitation.Result[97] For these reasons, the appeal is dismissed. The appellants are jointly and severally liable to pay the respondents costs of $6,000 and usual disbursements.Solicitors: Kensington Swan, Auckland for Appellants Paul Cassin, Pakuranga for Respondents