Man O'War Station Ltd v Auckland Council [2014] NZEnvC 260

Introduction

The Environment Court has recently considered how the high profile Supreme Court judgment of Environmental Defence Soc Inc v The New Zealand King Salmon Company Ltd (the ‘King Salmon’ decision)[1] might apply to applications for resource consent.

The Man O’War case was the final in a series of decisions regarding a resource consent application by Man O’War Station Ltd (MOWS) to authorise construction of a coastal residential development on Waiheke Island. Notably, an earlier interim decision of the Environment Court with respect to MOWS was considered in the King Salmon decision. In the latter case, the Supreme Court focussed on the approach taken by decision-makers to proposed changes to policy statements and plans, and (according to the Environment Court in Man O’War) “found comprehensively” against this requiring an “overall broad judgement”.

In its final decision, the Environment Court re-considered its interim findings in light of comments made in the King Salmon decision. It also came tantalisingly close to expressing a view as to whether the approach to determining changes to plans and policy statements outlined by the Supreme Court might also apply in the context of resource consent applications.

Summary of the MOWS litigation

The original appeal

The case has a complex history. It began in 2010 when MOWS appealed against conditions of consents granted to it by the then Auckland City Council.[2] The consents authorised the construction of two buildings, a dwelling and guest accommodation, on a large site on the north eastern coast of Waiheke Island, Owhiti Bay. Auckland Regional Council also appealed, seeking that the consents be cancelled. The Environment Court reversed the City Council’s decision, and declined the consents. In considering the application within the context of Part 2 of the RMA, the Court held that adverse effects on the environment would be “considerably more than minor”, and strongly militated against a grant of consent.

The High Court Appeal

MOWS then appealed to the High Court, alleging that the Environment Court had made a number of errors in law.[3] The High Court rejected most of MOWS’ claims, but found that the Environment Court had erred by failing to give genuine attention and thought to the Council’s original decision, and by finding that MOWS had failed to consider alternative sites. The appeal was therefore allowed, and the case remitted back to the Environment Court for rehearing.

The Interlocutory Application

Prior to the substantive rehearing, MOWS filed an interlocutory application to have the Court consider a revised proposal of reduced scale (and which had a ‘discretionary’ activity status).[4] Auckland Council (as it now is) disputed whether the Environment Court had the jurisdiction to consider an alternative proposal, but it was found that the modified proposal was within the building envelope of the original proposal, so it was appropriate for it to be reheard.

The Interim Decision

The Environment Court accordingly reheard the remaining two matters. The Court agreed with MOWS’s new expert evidence that the revised proposal would not adversely affect the natural character or outstanding landscape values within the coastal environment. It issued an interim decision granting consent (subject to the conditions being finalised), concluding that the revised proposal would achieve the purpose of the RMA.[5]

The Court considered Policy 15(a) of the New Zealand Coastal Policy Statement (NZCPS), which requires adverse effects on outstanding natural features and landscapes of the coastal environment to be avoided. It compared Policy 15(a) to section 6(b) of the RMA, which provides for “the protection of outstanding natural features and landscapes from inappropriate subdivision, use, and development.” In particular, the Court considered which of these provisions should trump or qualify the other, and whether the NZCPS required complete avoidance of adverse effects, regardless of their impact or significance.

It held that the NZCPS was subject to Part 2 of the RMA when considered in the context of a resource consent application, but assumed a dominant role in the formulation of subordinate planning documents. Importantly, Policy 15 was found to be designed to guide the creation of regional and district planning documents – not to limit consideration of individual applications for resource consent, or to totally prohibit any adverse effects associated with development.

In the particular circumstances, the Court found that any adverse effects on natural character and outstanding natural landscapes in the coastal environment were essentially avoided. It concluded that the proposal would meet the purpose of the Act, provided a number of “relatively minor” matters (changes to conditions) were “tidied up” to the satisfaction of the Court. The parties presented the final conditions accompanied by a Joint Memorandum in Support in October 2013.

The Supreme Court considers the Interim Decision

Between November 2013 and April 2014, the Supreme Court heard the King Salmon appeal.[6] Relevant to the final MOWS litigation, the Supreme Court considered whether changes to policy statements and plans should be determined applying an ‘overall broad judgment’, or whether certain provisions of the NZCPS should be construed to require an absolute avoidance of adverse effects, based on environmental bottom lines. In reaching its decision, the Supreme Court cited the MOWS interim decision. The majority outcome in King Salmon prompted the Environment Court to review some aspects of its earlier interim decision.

The final MOWS Environment Court decision

The Environment Court considered the following two questions in reaching its final decision:

  1. Do the Supreme Court’s findings in the King Salmon decision (relating to the approach to be taken by decision-makers to proposed changes to policy statements and plans) apply to the consideration of resource consent applications under section 104 of the RMA?

  2. Would the MOWS proposal (as described by its expert planner) satisfy the test set out in paragraph [145] of the Supreme Court’s decision – namely, that adverse effects on outstanding natural features and landscapes, and the natural character of areas of outstanding natural character, in the coastal environment should be avoided, but minor or transitory adverse effects need not be prohibited in order to preserve the natural character of the coastal environment?

Following the Supreme Court decision, the Environment Court reconsidered whether, as a matter of law, the NZCPS could take a “harder line” than the Act (and in particular section 6(b)). As to this, the Environment Court inferred that the Supreme Court had approved of the approach it had taken in its Interim Decision, being that the NZCPS could be interpreted as imposing strong environmental “bottom lines”.

The Environment Court then considered the meaning of the term ‘avoid’. It considered the Supreme Court had referred with implicit approval to the Interim Decision’s finding that the word ‘avoid’ does not mean ‘prohibit’, but rather has the ordinary meaning of “prevent occurrence of” or “not allow”. The Supreme Court also noted that such an interpretation could have contrasting consequences, depending on whether an overall broad judgement approach is taken, or one involving environmental bottom lines. As the Environment Court noted, the majority of the Supreme Court ultimately considered the latter to be the appropriate approach in the context of proposed changes to policy statements and plans.

At this point in its decision, the Environment Court determined not to reach a conclusion regarding whether this approach applies to consideration of applications under section 104 – for two reasons: first, the answer was presented in the MOWS case in another way, and second, because it would be inappropriate to answer such a legal question on the papers, when argument had been “brief at best”.

The Court instead turned to consider whether the MOWS’ proposal could satisfy the test set out in the King Salmon decision – that it would not be necessary to avoid any activity that has a minor or transitory adverse effect in order to preserve the natural character of the coastal environment. The Court carefully re-read the relevant planning evidence, and found that any potentially relevant adverse effects were in fact low or negligible. These potential effects, taken collectively or individually, were found to satisfy the Supreme Court’s exception for “minor” or “transitory” effects.

For this reason, the Court ultimately found it was unnecessary to rule whether the key findings in the Supreme Court decision are as applicable to the RMA consenting regime as they are to plan making. If they are so applicable, the Court considered they had been met with respect to MOWS’ present application.

Reflection

To date, the courts have been tentative regarding the applicability of the King Salmon approach to resource consent applications.

A majority decision of the independent ‘Basin Bridge’ Board of Inquiry[7] found that the specific statutory context (i.e. being a plan change, and thus subject to a statutory requirement to ‘give effect to’ the NZCPS) was central to the King Salmon decision. By contrast, the Board found that it must adhere to the specific statutory direction to appropriately consider and apply Part 2 in making a determination on both notices of requirement and resource consent applications.

The Environment Court stated in Calveley v Kaipara District Council[8] that the requirement to avoid adverse effects was used by the Supreme Court in the specific context of the NZCPS. It held that the proper interpretation of “inappropriate” when considering a resource consent application was that used by the Court of Appeal in Powell v Dunedin City Council:[9] namely, to consider the provision in its immediate plan context.

In KPF Investments Limited v Marlborough District Council,[10] the Court stated that the evaluation to be made in the context of resource consent applications was wider than that for a plan change. Further, it held that the words “subject to Part 2” in section 104(1) meant that there could be no absolute ‘bottom lines’ when determining an application for resource consent – even when regard had to be made to a national policy statement. The overall broad judgement approach was deemed necessary, because such decisions must achieve the RMA’s purpose.

It would therefore seem that the basis of the King Salmon decision was its particular context – being a plan change application. Until an appellate court provides more definitive direction on this matter, the ‘broad overall judgement’ pursuant to Part 2 of the RMA continues to be the appropriate approach for decision-makers determining resource consent applications.

 

 

[2] Man O’War Station Ltd v Auckland City Council [2010] NZEnvC 248.

[3] Man O War Station Ltd v Auckland Regional Council CIV-2010-404-5288, 11 May 2011.

[4] Man O’War Station Ltd v Auckland Council [2012] NZEnvC 84.

[5] Man O’War Station Ltd v Auckland Council [2013] NZEncV 233.

[6] Environmental Defence Society Incorporated v The New Zealand King Salmon Company Limited SC 82/2013; [2014] NZSC 38; [2014] NZRMA 195.

[7] The ‘Basin Bridge Proposal’ Independent Board of Inquiry’s Final Report and Decision, dated 29 August 2014.

[8] [2014] NZEnvC 182.

[9] [2004] 3 NZLR 721.

[10] [2014] NZEnvC 152.