Bunnings Ltd v Hastings District Council
 NZEnvC 4
BEFORE THE ENVIRONMENT COURT
Environment Judge B P Dwyer sitting alone under s279 of the Act
In Chanlbers at Wellington
In the Matter of an appeal under section 120 of the Resource Managenlent Act 1991
Application to determine quantum of costs following failed appeal to Environment Court — appellant's proposal to build warehouse rejected by the District Council — appeal found the proposal failed to meet the requirements of s104D Resource Management Act 1991 (particular restrictions for non-complying activities) — respondent council applied for costs award in the higher than normal range as appeal was one of series of attacks on district plan's policies and objectives for that zone — whether council's decision to instruct senior counsel had lead to multiplication of legal costs — whether higher than normal costs to be awarded — whether council should have instructed senior counsel.
The issue was: whether higher than normal costs were to be awarded; and whether instruction of senior counsel had lead to an unnecessary multiplication of legal costs.
Held: The test as to the appropriate level of costs contained in s285 RMA (awarding costs) was “what was reasonable?(“RMA”) (right to appeal). Bunnings Ltd (“Bunnings”) submitted a proposal As a matter of general observation, costs awards in the EC fell into three broad categories:
Standard costs falling within a comfort zone of 25-33% of actual costs;
Higher than normal costs where aggravating factors were present (Bielby);
Indemnity costs, which were rarely awarded and only in exceptional circumstances.
This was a case where higher than normal costs ought to be awarded for four reasons. First, the council decision was upheld by the court in all respects. Secondly, the case advanced by B suffered from fundamental flaws in that B considerably understated the versatile nature and capacity of the soils of the site, and took a too narrow approach to the objectives and policies of the district plan. Thirdly, the appeal involved issues of considerable public interest in terms of application of the district plan. Finally, there was failure to adequately assess the effect that the proposal had on the adjacent land owned by CDL, which was a matter specifically identified in the council decision.
The council could not be criticised for instructing senior Counsel, having regard to the obvious significance of this case for the council. Nor could it be criticised for relying on the services of its usual legal advisor who had attended to case management issues leading up to the hearing. However while it was not up to Bunnings to dictate who the council should instruct, it was not reasonable to penalise the company for the council having chosen “gold plated(“RMA”) (right to appeal). Bunnings Ltd (“Bunnings”) submitted a proposal representation.
Costs set at 50% of actual costs incurred.
Decision Issued: 1 8 JAN 2012
A: Costs awarded.
On 6 October 2011, the Court issued a decision 1 declining an appeal by Bunnings Limited (Bunnings) against a decision of Hastings District Council (the Council) refusing an application for land use consent to construct and operate a Bunnings Warehouse at Pakowhai Road, Hastings,
Costs were reserved. The Council and CDL Land NZ Limited (CDL) (a s274 party) sought costs awards against Bunnings. Tlie costs applications were put on hold to enable discussions to take place between Bunnings, the Council and CDL with a view to those parties resolving costs between them. They have been unable to do so and have referred the matter back to the Court for resolution.
The Council seeks a costs award against Bunnings of $130,000, being approximately 65% of total costs incurred by the Council. CDL seeks a significant award of costs. Bunnings opposes the costs applications.
Burinings' proposal was for the establishment of a large warehouse style retail operation, selling a wide range of home, building, hardware and garden products on a 4ha block situated in the Plains Zone of tlie Hastings District Plan (tlie District Plan) on the rural outskirts of I-Iastings City.
The proposal constituted a non-cotnplying activity under the District Plan and was publicly notified. Twenty five subrnissiotls were received, 18 of which opposed tlie proposal.
decision pursuant to s290A RMA in the course of our decision and noted that, our findings are largely in accordance with those made by the Council. 2
We reached the conclusion that Bunnings' proposal passed through neither of the two gateways of s104D RMA. We were not satisfied that the adverse effects of the proposal on the environment would be minor. That finding was largely based on what the Court considered to be inadequacies in Bunnings' assessment of the effects of its proposal on CDL's adjoining land. We also found that the proposal was contrary to the objectives and policies of the District Plan. The appeal was declined on that basis.
We went on to consider the proposal on its merits in accordance with s104 RMA. We found that even if the application had passed one of the gateway tests contained in s104D, we would have still declined consent.
We made the following finding: 3
In our view, Bunnings' proposal does not achieve the purpose of sustainable management. Although it has some positive enabling aspects, it appears to be directly opposed to the aims of s5(2)(a) and (b) RMA. The District Plan emphasises those aims through its objectives and policies insofar as sustainable management of the Heretaunga Plains is concerned. We consider that is the determinative factor in the outcome of these proceedings.
In reaching the above conclusion, we emphasised the importance of the objectives and policies of the District Plan which set out to protect the rural resource of the Hastings district. We held that Bunnings' approach to this issue which concentrated on the soil structure of the site, rather than the wider rural resource, was fundamentally flawed. 4
The Council Application
The Council incurred costs totalling $198,955.34. 5 It suggested that an appropriate award to it would be $130,000. The Council identified its costs in the following table:
(a) Mr J Ash — preparation of evidence and attendance at Court
Pedologist, Mr S Hainsworth - site investiaation. weoaration of evidence and attendance Court, travel and accommodationtravel and accommodation
(c) Soli scientist, Dr B Clother — site investigation, preparation of evidence and attendance at Cour, travel and accommodation
(d) Economist, Dr J Small — preparation of evidence and attendance at Court, travel and accommodation
(e) Property adviser and valuer, Mr Penrose — site investigation, preparation of evidence and attendance at Court
(f) Resource managment witness, Mr Matheson — preparation of evidence and attendance at Court, travel and accommodation
(g) Legal fees — senior counsel (time only, no travel or other ‘out of town’ disbursements)
(h) Legal fees -solicitors and junior counsel
(i) Hastings District Council planner, Mr P McKay — preparation of evidence and attendance at Court
The Council's submission referred to the provisions of s285 RMA and the Court's broad discretion to award costs. It referred to the usual range of authoritiescited in costs applications. It contended that the Council had a particular interest and a public duty to see that the strong policy direction of the District Plan was upheld.
The Council identified three factors which it submitted were of particular significance in exercise of the Court's discretion to award costs:
• The fact that the Court largely concurred with the findings of the Council's Hearings Commissioners;
• That the appeal was one of a succession of attempts to establish noncomplying activities in the Plains Zone where the objectives and policies of the District Plan have come under attack;
• The Court upheld the primacy of the objectives and policies of the District Plan and found that the proposal was contrary to the purpose of achieving sustainable management.
The Council raised the issue of cost claims for staff members in respect of the evidence of its planner, Mr P McKay. It contended that Mr McKay was diverted from other duties to provide the Court with evidence on policy issues which related directly to the hearing and...
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