Tacon v Hastings District Council Hc Nap

JurisdictionNew Zealand
CourtHigh Court
JudgeWylie J
Judgment Date06 May 2013
Neutral Citation[2013] NZHC 1078
Docket NumberCIV 2012-441-000610
Date06 May 2013

[2013] NZHC 1078

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CIV 2012-441-000610

IN THE MATTER OF a proceeding pursuant to the Declaratory Judgments Act 1908

BETWEEN
Janis Tacon
Plaintiff
and
Hastings District Council
Defendant
Counsel:

G W Calver for the Plaintiff billcalver@xtra.co.nz

M Casey QC for the Defendant matt@casey.co.nz

Application for declarations that a targeted rate imposed by the Hastings District Council was not lawfully levied under Local Government (Rating) Act 2002 — plaintiff owned a property adjoining local domain leased by council — council resolved to purchase domain for $1.17 million on a conditional basis — council considered the purchase could be funded in part by contributions from adjoining landowners — either a lump sum contribution of $23,000 each, or increased rates of $3,148 per year over 10 years — plaintiff did not agree — whether targeted rate was within statutory purpose — whether council had complied with statutory requirements — whether declaration under s3 Declaratory Judgments Act 1908 (declaratory orders on originating summons) was the appropriate remedy.

The issues were: whether a declaration under s3 DJA was the appropriate remedy; what did the words “identified in its funding impact statement”, used in s16 LGRA mean; and, what did the words “[d]espite subsection (1)” used in s18(2) LGRA (calculating liability for targeted rate — despite subsection (1), the liability for a targeted rate may be calculated as a fixed amount per rating unit).

Held: The Court would not issue a declaration under the DJA where the facts were in dispute or where the question posed for determination involved a mixture of law and fact. There were a number of factual disputes raised by the affidavits. Questions dealing with the reasonableness of the targeted rate could not be addressed as they were not appropriate when a declaration under the DJA was sought. A declaration could have been sought, either alone or with other forms of relief, by way of an application for review under the Judicature Amendment Act 1972 (“JAA”) or at common law under the Court's inherent jurisdiction. However no application for review under the JAA was made and the Court did not have the power to make such a direction of its own motion.

Section 101(3) LGA was a “critical filter” by which funding in respect of each activity had to be considered and determined. The section put in place a process by which local authorities identified and then used funding sources. It gave local authorities considerable flexibility in apportioning liability between various sources.

Local authorities had to determine the appropriate sources to meet their funding needs after consideration of the matters identified in s101(3)(a) and (b) LGA. The word activity meant each good or service provided by a local authority and included the provision of facilities and amenities. When considering each activity to be funded, the local authority had to consider each of the five factors in s101(3)(a). The factors were cumulative and consideration of each of them was mandatory.

One of the identified factors was the distribution of benefits between the community as a whole, any identifiable part of the community, and individuals. The acquisition of the domain was an activity as defined in the LGA.

Following completion of its consideration obligations under s101 LGA, the council was entitled to determine how its funding needs arising from the purchase of the domain would be met. In the event, it determined to allocate the funding needs between itself, the Regional Council, and the individual landowners. This apportioned the benefit of acquiring the domain between adjoining landowners, the wider regional community, and the district community. It was noteworthy that the council did not seek to recover the full benefit assessed to each adjoining landowner (in a valuation report). The council determined to recover part of its funding needs for the purchase of the domain from the adjoining landowners to recoup in part the benefit derived by those landowners. The council was entitled to reach such a conclusion on the materials before it, and at law.

Section 16 LGRA then fell to be considered. It was clear from s16 that:

  • a) a local authority had a discretion whether or not to set a targeted rate;

  • b) a targeted rate might be set in respect of one or more activities or groups of activities;

  • c) the discretion could only be exercised if those activities were identified in its funding impact statement; and

  • d) a targeted rate might be set either in relation to all rateable land within the district or in respect of one or more categories of rateable land under s17 LGRA (categories of rateable land for setting targeted rate).

T sought a declaration as to what the words “identified in its funding impact statement” required. It was not suggested however that there was any confusion or lack of clarity as to the meaning of these words, why they had to be construed. Rather, T argued that the document in which the activity was identified was not a funding impact statement. That was a rather different issue. The words “identified in its funding impact statement” were perfectly clear. They bore their ordinary commonsense meaning. The section required simply that the activity or groups of activities intended to be the subject of a targeted rate had to be identified or set out by a local authority in its funding impact statement.

A “funding impact statement” was defined in s5 LGRA (interpretation) and referred to cl 15 Schedule 10 LGA (funding impact statement). A declaration that the words “identified in its funding impact statement” meant that the activity, or groups of activities, intended to be the subject of a targeted rate had to be identified, or set out, by the local authority in its funding impact statement, and that the words a “funding impact statement” bore the meaning attributed to them in s5 LGRA, did not advance matters from T's perspective. There was no utility in declaring that the statute meant exactly what it said.

In relation to the domain, the activity — the acquisition of land — was specified, albeit in a heading. The categories of rateable land subjected to the targeted rate were identified — it was the properties adjoining the Waimarama Domain. The basis of calculation was said to be “the direct private benefit to the adjoining landowners”. The format of the council's long-term plan was unfortunate because:

  • a) while certain statements were identified as “funding impact statements”, those statements did not incorporate all of the information required by cl;

  • b) the required information was spread throughout volume 2 and included incorrect headings;

  • c) the required detail was given in part of the plan headed “Part B — Rates for 2012/13”. However, the targeted rate could extend through until 2022 for those who elected to pay by way of instalments.

Further there were deficiencies in the information provided including:

  • a) how the liability for the set rate was calculated – the council need to go further than simply asserting that it was based on the direct private benefit to adjoining landowners;

  • b) c15(4)(c)(ii) had not been complied with as the domain land was in two titles and although separately rated, they paid only one lump sum;

  • c) c15(5) was not complied with as the targeted rate was excluded from the example given in the funding impact statement of the impact of the rating proposals in the rates assessed on different categories of rateable land with a range of property values.

These deficiencies notwithstanding, even if this matter had been an application for judicial review, relief would not have been granted as:

  • (a) the council assiduously consulted with its community and the adjoining landowners;

  • (b) the proposed targeted rate and basis on which it was calculated was clearly explained to the adjoining landowners;

  • (c) only T was unhappy with the targeted rate and had refused to pay;

  • (d) the purpose of a long-term plan was to provide an opportunity for community participation in council decision making and purpose had clearly been met in this case;

  • (e) the information that was included in the plan sufficed to put T on notice, and there could be no suggestion she was not properly informed in relation to the issue; and

  • (f) were the targeted rate to be set aside, the council could address the situation afresh and repeat the exercise properly.

Section 18 LGRA provided for how liability for a targeted rate might be calculated. The opening words in s18(2), “despite subsection (1)”, had to be taken to mean what they said, and a council could either calculate liability for a targeted rate under s18(1), or calculate liability for a targeted rate as a fixed amount, under s18(2). The words “[d]espite subsection (1)” did not, on the face of it, require a council to first have regard to the matters detailed in s18(1), before calculating liability for a targeted rate as a fixed amount per rating unit. The two calculations required were alternatives This was supported by a number of Schedule 3 LGRA (factors that may be used in calculating liability for targeted rates) factors that could only assist in determining the proportion the property owners collectively should pay, as against other funding sources..

Declaration that the words “despite subsection (1)” used in s18(2) LGRA did not require a local authority to take into account the matters detailed in s18(1), when calculating liability for a targeted rate as a fixed amount per rating unit.

While the council might not have fully complied with its obligations under s16 LGRA, T was not entitled to a declaration under s3 DJA.

[RESERVED] JUDGMENT OF Wylie J

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1 cases
  • Tacon v Hastings District Council HC
    • New Zealand
    • High Court
    • 14 May 2013
    ...HIGH COURT OF NEW ZEALAND NAPIER REGISTRY CIV 2012-441-000610 [2013] NZHC 1078 IN THE MATTER OF a proceeding pursuant to the Declaratory Judgments Act 1908 BETWEEN JANIS TACON Plaintiff AND HASTINGS DISTRICT COUNCIL Defendant Hearing: 6 May 2013 Counsel: G W Calver for the Plaintiff M Casey......

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