Rounding up some recent key developments in Resource Management

ADLS’s Environment and Resource Management Committee, convened by John Burns, has brought together and commented on some recent cases and developments of interest of which practitioners in this area should be aware.

Kiwi Property Holdings and NZ Historic Places Trust v Auckland Council (the “Britomart case”)

In its recent decision in Kiwi Property Holdings and NZ Historic Places Trust v Auckland Council (2013 NZEnvC 303), the Environment Court (Court) has upheld the re-zoning of the site of the Seafarers Building at Quay Street in the Britomart Quarter to enable buildings of up to 55 metres in height. Opponents had sought that the height be restricted to 24 metres.

The Court noted that no one was arguing that the Seafarers Building itself had any particular historic or architectural merit, or should be retained. The issue was whether a comparatively tall replacement building would necessarily diminish the value of the other existing heritage buildings in the Britomart Quarter, simply on account of its size.

The Court held that, provided any new building was designed to suitably high architectural standards, a resource consent application for it was subject to close scrutiny by the Council (including review by the Council’s Urban Design Panel), and the NZ Historic Places Trust was recognised as an affected party on the application, then effects on surrounding heritage values should be capable of being avoided, remedied or mitigated in accordance with the Resource Management Act (RMA). The Court commented that if they cannot, through the particular design proposed, then consent could be refused.

The case supports the proposition that good design, rather than just size, is a key component to CBD development in Auckland, and may have relevance when the new proposed Auckland Unitary Plan provisions are considered by the Council Hearing Panel later this year.

Local Government Amendment Bill (No. 3) - Development Contributions

A 2013 government review of development contributions identified difficulties associated with the current legislative framework and how it is being implemented by councils. For example, the review noted that development contributions are being used to fund types of infrastructure that may be better funded from general revenue sources, and that the degree of transparency in the apportionment of the costs and benefits of infrastructure is variable. The review also identified that there are limited mechanisms for resolving challenges to development contributions charges, and opportunities to encourage greater private provision of infrastructure.

To address these matters, the Local Government Amendment Bill (No. 3) provides a new purpose for development contributions, and principles to direct and guide how they are used by councils. Secondly, there are provisions that clarify and narrow the range of infrastructure that can be financed by development contributions. Thirdly, the Bill introduces a development contribution objection process, with decisions to be made by independent commissioners. In addition, the Bill encourages greater private provision of infrastructure through the use of development agreements, and includes provisions to improve the transparency of councils’ development contributions policies.

Submissions closed in February 2014 and the Select Committee is now meeting with some urgency. We expect the Bill to find its way back to the House quickly, with the Bill enacted by mid-year.

Local Authority Amalgamation – Local Government Act 2002 Amendment Act 2012

The process for reorganising local authorities was significantly changed by the Local Government Act 2002 Amendment Act 2012, allowing for a streamlined process.

Anyone can now make an application to the Local Government Commission (Commission) requesting a reorganisation. The Commission checks that the application contains all the information it is required to and considers whether there is community support for change. If the Commission is satisfied the application meets these requirements, it then notifies it to allow for alternative applications to be made.

After considering submissions it may then issue a final proposal. If a final proposal is issued, a poll on the proposal may be requested by 10% of the electors in any one of the affected districts. If a proposal is supported by a poll, or if there is no poll, a reorganisation scheme giving effect to the proposal is prepared and implemented by Order in Council.

Currently there are three areas undergoing this process: Northland, the Hawkes’ Bay and Wellington. In both Northland and the Hawkes’ Bay, public submissions have just closed on the Commission’s preferred option. Interestingly, both looked very similar to the Auckland Council model of local government.

We expect the Commission’s final proposals to be out later this year – perhaps after the national elections – when we may see the establishment of two new Unitary Councils.

Auckland Unitary Plan – summary of submissions and further submissions stage

Submissions on the Auckland Unitary Plan closed on 28 February 2014, with tens of thousands of submissions made. The Auckland Council is now beginning the process of considering those submissions, with the first step being preparation of a “Summary of Submissions”.

Following release of the Summary of Submissions, certain persons may make further submissions. They include any person representing a relevant aspect of the public interest, any person that has an interest in the Auckland Unitary Plan greater than the interest that the general public has, and the Council itself. Further submissions must be limited to a matter in support of or in opposition to the relevant original submission.

It is likely the further submission process will take until about mid-year, following which the “hearings” phase will begin for submitters who have asked to be heard in support of their written submissions.

“Future Milford”

The Environment Court has approved, in an interim decision, a modified Plan Change 34 sought by Milford Centre Limited to the Auckland Council District Plan (North Shore Section) 2009.

At issue was balancing or integrating the objectives of residential intensification and of maintaining or enhancing the amenity and character of Milford. The development will proceed with:

• a reduction to the building heights of three of the highest buildings; and

• intensification set at 100-200 residential units.

Building heights are all less than those in the Auckland Unitary Plan which the Court considered but gave little weight to, noting the provisions may change after the Auckland Unitary Plan process. Readers wanting further information should visit http://milford2020.co.nz/.

Planet Kids Limited v Auckland Council

Planet Kids Limited operated a childcare centre from premises leased from the Auckland Council. The Council wished to use the land for a roading project and sought to acquire the lease under the Public Works Act 1981. On 3 June 2010, Planet Kids and the Council entered into an agreement said to be in full and final settlement of any claim for compensation under the Public Works Act.

Before the settlement date of the agreement, the premises were destroyed by a deliberately lit fire. Both parties accepted that, under the terms of the lease agreement, this caused the lease to terminate.

The Council’s position was that this event brought the settlement agreement to an end through the doctrine of frustration. Planet Kids’ position was that the settlement agreement subsists and is enforceable.

Planet Kids initiated proceedings seeking judgment for the amount outstanding under the agreement.

The High Court held that the settlement agreement was frustrated. This decision was upheld in the Court of Appeal. Leave was granted to appeal to the Supreme Court.

The Supreme Court held that the fire did not render performance of the settlement agreement impossible (Planet Kids Limited v Auckland Council (SC 5/2013) [2013] NZSC 147). Therefore the agreement was not frustrated. The only obligation that could not be performed by Planet Kids was the delivery at settlement of the physical property. Furthermore as the Council was not buying Planet Kids’ business, the chattels were not fundamental to the Council’s exercise of powers under the Public Works Act. Planet Kids’ lease would be terminated and compensation was payable for the consequential closure of Planet Kids’ business under the Public Works Act. That was the purpose of the agreement – that purpose was not frustrated by the fire.

The Supreme Court declared the settlement stands.

Environmental Defence Society Incorporated v Otorohanga District Council

In this recent decision of the Environment Court ([2014] NZEnvC 70 (27 March 2014)), Judge Kirkpatrick considered whether the proposed outcome agreed to by the parties to the appeals and expressed in draft consent documentation was within the scope of the proposed plan as publicly notified or as sought to be amended by an appellant’s submission on it [paragraph 7].

The jurisdictional issue was raised by Federated Farmers, following a mediation where it had agreed (together with the other parties) to resolve the appeals by way of consent. The relief sought by Federated Farmers in its submission on the proposed district plan is set out at paragraph 24 on pages 9-10 of the decision. The relief sought was “that only natural features and natural landscapes that have demonstrable outstanding and natural qualities are identified and mapped; and that correct RMA terminology is used through the Plan, and that the term Outstanding Landscapes is replaced with Outstanding Natural Landscapes”.

The Court considered whether there was jurisdiction through the Federated Farmers’ submission on the proposed plan, and its subsequent appeal, for further areas of outstanding natural landscape (ONL) to be included in the planning maps in the proposed district plan, when those areas were not so mapped in the notified version of the proposed district plan. Federated Farmers submitted that its submission and notice of appeal were limited to the ONLs as identified in the proposed district plan as notified. Emphasis was laid on the principle identified in Countdown Properties (Northland) that the Council cannot grant relief beyond the scope of the submission lodged in relation to the proposed district plan, and the focus must be on the submission rather than on the notice of appeal [paragraph 33].

The Council submitted that Federated Farmers entered into mediation and an agreement arising out of mediation. Judge Kirkpatrick stated at paragraph 35: “In my view, any such agreement is not relevant to the issue before the Court. The jurisdiction of the Court to make an order authorising changes to a statutory planning document cannot be conferred by agreement. The Court’s jurisdiction is established by the Act”.

There is a full discussion in paragraphs 45-51, and the Judge stated: “In terms of the relief sought, the use of the word ‘only’ indicates a submission that the maps as notified may have included areas that did not warrant such identification rather than that there were areas that should have been identified and were not … In my opinion, adding outstanding landscapes that have not previously been shown either on the planning maps as notified nor identified or otherwise referred to in submissions is not within the scope of the submission by Federated Farmers”.

The Judge concluded at paragraph 51: “The Court does not have jurisdiction to approve any consent order seeking to include new areas of outstanding natural landscapes or outstanding natural features beyond those shown on the planning maps in the decisions version of the Otorohanga proposed District Plan.” The Council was directed to revise the consent documentation to amend the maps so that they no longer showed new areas of outstanding natural landscapes or outstanding natural features or landscapes of high amenity value that were outside the areas shown in the decisions version of the proposed district plan.

Upcoming changes to the Resource Management Act

Lastly, the Environment and Resource Management Committee notes the recent announcement from the National Party that any changes to the Resource Management Act are on hold until after the election. The proposed changes were intended to speed up the approval of subdivisions and consents for home alterations and extensions, but also affect parts of the Act dealing with use, development and protection of natural and physical resources. Watch this space for more information post-election.

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