New Zealand: Extended Time To Implement Resource Consents

In this article, Amanda Douglas, a partner of the Christchurch Lawlink firm of Wynn Williams & Co, considers a recent High Court decision which clarifies how long you have to implement your resource consent.

Do you have a resource consent that you have not yet acted on?

Prior to August 2003, if you obtained a resource consent, you had two years in which to act on, or implement, that resource consent and to carry out the activity permitted by the consent. For example, if you had obtained a resource consent to erect a house in breach of a District Plan, you had two years in which to erect the house before the consent expired.

In August 2003, section 125 of the Resource Management Act 1991 was amended so that the period in which a resource consent could be implemented was extended to five years. It was clear that the extended implementation period would apply to any consents granted after 1 August 2003. However, there was debate as to whether consents that had been granted prior to 1 August 2003 now had an automatic extension of time for implementation or whether they were restricted to the two-year period of implementation as existed at the time when the consent was granted.

This position has now been clarified by the High Court in Art Deco Society (Auckland) Incorporated v Auckland City Council & Ors, CIV-2005-404-1729. In that case, Bank of New Zealand (BNZ) had obtained a resource consent to demolish a substantial and entire block of the central business district in Auckland in December 2002. Since the granting of the 2002 consent, Art Deco became concerned to preserve the heritage value of one of the buildings on the site. The Auckland City Council sought a declaration from the Environment Court, after opposition from Art Deco, seeking a determination that the amended version of the Act applied to the 2002 resource consent, such that it lapsed five years after the date of its commencement (ie that the amendment automatically applied to this pre-2003 consent).

The Environment Court found that section 125, as amended in 2003, applied to the 2002 resource consent granted to BNZ to demolish buildings, notwithstanding that the consent was granted before the date when the amendment came into force. By way of further declaration, the Environment Court declared that the amendment to the Resource Management Act applied to all resource consents which did not have a lapsing date specified as a condition of consent, and which were valid resource consents as at 1 August 2003 (when the amendment came into force). Art Deco appealed this to the High Court.

The High Court held that the plain words of the relevant sections of the Act are that all resource consents in existence following the date of the amendment on 1 August 2003 will have a five-year term. This means that any resource consent that had been granted between 1 August 2001 and 1 August 2003, and did not have a condition altering the statutory lapsing period of two years, received an automatic extension of its lapsing period to five years.

Arguments were raised that this had a retrospective effect, which is contrary to the general principles applicable to enactment of legislation. The High Court said, in this present situation, the wording of the amended section 125 is clear and, on its face, applies not only to future resource consents but, rather, to all resource consents whenever they came into effect. However, the Court said that there is no express statement that the section is to have retrospective effect.

The Court concluded that the amendment to section 125 does have a retrospective aspect in that it changes the expiry date of consents that were issued prior to the amendment. However, the amendment does not provide that, at a past date, the law should be taken to be something which it is not. Rather, it changes a term of an existing right for the future. The Court said, on the plain words of the section, this appears to be the intent of the legislature. Such an effect is consistent with the purpose of the legislation, as best as it could be ascertained by the Court from the words, context and external indications of intent. The High Court said that such an effect does not manifestly shock as unjust, or involve any glaring unfairness. It simply added to, and benefited, an existing consent, and was forward-looking, rather than providing that consent holders would lose something akin to a vested or accrued right.

The Court concluded that the legislation meant what it said, in that the five-year expiry date applies to all resource consents.

Another issue raised in the decision was whether an advice note as to the lapsing period at the bottom of the resource consent limited the consent to a two-year lapsing period, such that the amendment to the Act could not apply. Section 125 of the Act provides that the default lapsing period is five years (as amended in 2003) unless it is otherwise stated in the resource consent. Art Deco tried to argue that an advice note which referred to a lapsing period of two years limited the lapsing period to that period of time, thus removing the ability to take advantage of the amendment to the Act.

The Court found that an advice note is quite different from a condition of consent. It said that advice is, by nature, an opinion or recommendation and it is different from a condition, which carries with it the meaning of a legally imposed stipulation. The Court was influenced by the fact that the advice notes were declaratory of what was contained in the Act or general law and practice, rather than declaratory of any intention or condition imposed by the Council. It did no more than express what was set out in section 125; mainly the expiry date imposed by the legislature.

The Court held that it was not correct to categorise the statement as anything more than advice and that it was not possible to elevate the advice into a condition. As a result, the Court decided that no lapsing period had been imposed on the resource consent granted to BNZ in that case, and therefore, it could take advantage of the 2003 amendment to the Act. This meant that BNZ had five years in which to implement its consent.

The effect of this decision is a confirmation that, if you hold a resource consent without a stipulated lapsing period, that was granted between 1 August 2001 and 1 August 2003, the time period for implementing that resource consent has automatically been extended to five years. The five-year period applies to all resource consents, in fact, but provides a "bonus" to those that were granted prior to the 2003 amendment.

The case also confirms that advice notes on a resource consent cannot be elevated to resource consent conditions.

Some may argue that the automatic extension of the lapsing period has provided an undeserved bonus to consent holders who otherwise carried the expectation that their consent would expire in two years if not implemented. In enacting the amendments to the legislation, Parliament was attempting to reduce the complexity and compliance costs associated with resource consents. That being the case, this outcome would seem to be that anticipated by Parliament.

If you have a resource consent that you have not implemented and you wish to check whether you can take advantage of this extension of time resulting from the amendment to the Act, contact the resource management team at your Lawlink firm.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.