Waiheke Island Airpark Resort Ltd v Auckland City Council

 
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Decision No. [2010] NZEnvC 086

BEFORE THE ENVIRONMENT COURT

(ENV-2008-AKL-000316)

In The Matter Of The Resource Management Act 1991

And

In The Matter Of An Appeal Under Section 120 Of The Act

BETWEEN
Waiheke Island Airpark Resort Limited
Gulf District Plan Association (ENV-2008-AKL-000307)
Auckland Regional Council (ENV-2008-AKL-000310)
Vickery and Pannett (ENV-2008-AKL-000309)
Appellants
and
Auckland City Council
First Respondent
Auckland Regional Council
Second Respondent

Hearing on the Papers

Environment Judge L J Newhook sitting alone under s279 of the Act

Application for costs by a successful party in Environment Court proceedings against the Auckland Regional Council, regarding a proposal for further development around the periphery of the existing Waiheke Island airfield — whether an award of costs in excess of the norm was justified because of the actions of the Council.

Held: Section 285 Resource Management Act 1991 gave the Court a wide discretion to award costs as were considered reasonable in the circumstances of a case. It was appropriate to make an award of costs against ARC. ARC failed to take a reasonable approach to the appeals. The consent required for water and soil matters should have been forthcoming from ARC. It should not have been necessary for Waiheke to lodge an appeal against ARC's decision. To have refused that which was so obviously capable of settlement, as demonstrated by that having ultimately quite readily occurred, smacked of the taking of a position of placing all obstacles in the path of Waiheke. Although the Court could not entertain claims for costs in relation to the occurrences of a first instance hearing, under section 290A RMA, the Court must have regard to decisions appealed from. Passages from ARC's decision indicated that it inappropriately mixed up land use matters with water, waste, and excavation permit issues. In giving reasons for its decision, ARC referred to landscape values, the scale and intensity of the proposal, the regional significance of the infrastructure, and the Metropolitan Urban Limit. ARC's unreasonable approach to the appeals developed from the flawed approach it took at first instance, and caused Waiheke to incur unnecessary costs.

A failure to explore the possibility of settlement, when it could reasonably have been expected, was a factor indicating that a higher than usual award of costs may be appropriate. In particular, ARC's failure to settle resulted in Waiheke's expert witnesses being required to prepare for hearing.

Furthermore, it was relevant to an application for costs that ARC had chosen to call landscape and planning evidence that was seriously deficient. This feature of the case was highlighted by the unrealistic resistance by those witnesses to answering cross-examination questions in an objective fashion; and their ultimate forced and grudging concessions thereon.

In determining the level of costs award, ARC referred to the District Court costs scales as an appropriate reference point. However, the District Court approach to costs was of little assistance in this case, given the relatively short hearing but the considerable time and effort needed “behind the scenes”. An award of costs of $97,133.34 against ARC in favour of Waiheke was made.

  • A. ARC is ordered to pay costs of $97,133.34 to WIARL.

  • B. This order may be enforced in the District Court at Auckland, if necessary.

DECISION OF THE ENVIRONMENT COURT ON COSTS
REASONS
Introduction
1

These appeals concerned a proposal for further development around the periphery of the existing Waiheke Island airfield. An interim decision dated 29 September 2009 was issued, 1 in which the Court considered that consent could be granted to the proposal. However, the conditions of consent required refinement, and the Court requested the parties to file draft conditions within 20 working days of the date of the interim decision. Costs were reserved.

2

The Court issued a final decision dated 9 February 2010. 2 The Court approved the conditions of the Auckland City Council land use consent, and the conditions of consent for the Auckland Regional Council permits. The Court also acknowledged in its final decision the parties' submissions in relation to costs, and noted that a separate costs decision would be issued.

Waiheke Island Airpark Resort Limited's costs application

3

WIARL made a costs application dated 27 October 2009 in which it submitted that it incurred $227,242.58 costs. It notes that costs awards of between 25% and 33% are normally within the Court's “comfort zone” (Emerald Residential Ltd v North Shore City Council)3. However, WIARL seeks a higher award, while accepting that such an award is for the Court's discretion. WIARL's summarised submissions are as follows:

  • • WIARL should not have been required to appeal ARC's decision declining consent, as WIARL's proposals met all of ARC's established standards. ARC's whole planning approach was entirely misconceived, and WIARL

    was required to incur very substantial expenditure addressing claims that lacked credibility;
  • • ARC did not provide any evidence of its own on issues relating to consents that had been sought from it;

  • • An award of costs may compensate parties for costs unnecessarily incurred as a result of proceedings which should not have been brought, or which were presented in such a way as to require parties to incur unnecessary expense (Banks v Waikato Regional Council; 4Paihia & District Citizens Association Inc v Northland Regional Council)5

  • • The Court has been willing to contemplate costs higher than party-party costs (Romily Nominees Ltd v North Shore City Council) n 6 Relevant considerations identified in Land Air Water Association v Waikato District Council7 included the raising of issues that lacked substance; insufficient narrowing of issues; continuing to contest much of the evidence; failure to comply with procedural directions and timetabling orders; and unreasonable resistance towards settlement;

  • • The result produced from expert witness caucusing should have made it clear to ARC that its case lacked merit, yet ARC persisted with its case;

  • • The primary decision maker is not usually ordered to pay costs when its decision is cancelled on appeal, unless it neglected a duty (Darroch v Northland Regional Council)8 Here, ARC failed in its duty to act fairly and impartially.

Auckland Regional Council's response to Waiheke Island Airpark Resort Limited's costs application

4

ARC opposed WIARL's application for costs for the following summarised reasons:

  • • ARC acted responsibly by lodging with the Court a joint memorandum with ACC, recording the conditions upon which the stormwater, wastewater and earthworks consents could be issued if the land use consent was granted. Given that the agreed conditions were significantly different from the conditions originally proposed by WIARL, an award of costs is unjustifiable;

  • • An award of costs in relation to issues that were settled in good faith would set an undesirable precedent (Keith v Northland Regional Council9 and Bridgecorp Limited an Receivership) v Hamilton City Council); 10

  • • It is not usual to order the primary decision maker to pay costs when its decision is cancelled on appeal unless it has neglected a duty. Here, the primary decision maker's decision was settled, not cancelled, and there is no basis for suggesting that ARC neglected any duty with regard to the settlement;

  • • ARC's case was supported by independent expert evidence;

  • • ARC acted in the wider public interest by seeking to protect the integrity and amenity of the landscape for users of the Regional Park and the Hauraki Gulf, as well as visitors to Waiheke;

  • • ARC has a legitimate and ongoing concern to ensure developments outside the MUL are not inconsistent with the Auckland Regional Policy Statement;

  • • ARC's case was conducted in an efficient and reasonable manner throughout. Concessions were made where appropriate (for instance, in relation to the question of non-complying / discretionary activity status);

  • • Costs should not be awarded by reference to a percentage of the actual costs incurred (White v Waitaki District Council11);

  • • Costs should lie where they fall. The costs claimed by WIARL are

    excessive for what was effectively a two day hearing, with only six major witnesses. If costs...

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