In a recent High Court decision Auckland Council v Cabra Rural Developments Ltd  NZHC 1892, the Court provided guidance on a range of fundamental issues in plan making. This note outlines the Environment Court and High Court decisions and sets out three key takeaways that anyone involved in plan-making processes should bear in mind.
The Environment Court decision
In Cabra Rural Developments Ltd v Auckland Council  NZEnvC 90, the Environment Court was tasked with deciding between two approaches to subdivision in rural Auckland: the "relatively conservative" approach from the Auckland Council's (Council) decision on the Auckland Unitary Plan (AUP); or a more enabling approach, as recommended by the Independent Hearings Panel (IHP) constituted under the Local Government (Auckland Transitional Provisions) Act 2010 (LGATPA).
The key difference between the positions of the Council and the IHP was over provisions of the AUP concerning "regulatory incentive subdivision": where a subdivision opportunity is obtained in exchange for the protection and/or enhancement of indigenous biodiversity. The Environment Court preferred the IHP's approach, favouring enabling regulatory incentive subdivision provisions for some of Auckland's rural zones.
The High Court decision
The Council appealed the Environment Court's decision to the High Court, alleging six different errors of law. The alleged errors were that the Environment Court:
- failed to take into account and properly apply mandatory considerations under the Resource Management Act 1991 (RMA);
- misapplied the provisions of the RMA and failed to have regard to the AUP;
- came to a conclusion without evidence or one to which it could not reasonably have come to on the evidence;
- took into account irrelevant considerations;
- failed to give reasons commensurate with the decision; and
- failed to determine issues in the proceeding.
Justice Gordon found that the Council succeeded on two sub issues of the first alleged error of law, as well as the second and fifth alleged errors of law. Three key points from the High Court's judgment are summarised below.
- The importance of considering all higher documents, not just the planning document immediately above the document under consideration
The High Court reinforced the Supreme Court's position in Environmental Defence Society Inc v The New Zealand King Salmon Company Ltd  NZSC 38 (King Salmon) that plan makers must consider all relevant higher order planning documents, rather than confining themselves just to the unchallenged parts of the planning document at issue, or to the planning document immediately above the document under consideration. The High Court commented:
This echoes Wylie J's findings in Royal Forest and Bird Protection Society of New Zealand Inc v Bay of Plenty Regional Council  NZHC 3080 that there are dangers with the "truncated" approach described in Appealing Wanaka Inc v Queenstown Lakes District Council  NZEnvC 139.
- The importance of analysing and reconciling any potential conflicts in the higher order documents
The High Court found the Environment Court did not consider all relevant objectives and policies in the New Zealand Coastal Policy Statement (NZCPS) and the Regional Policy Statement (RPS) when making its decision. Consequently, the Environment Court failed to recognise the extent to which the relevant NZCPS and RPS provisions pulled in different directions, and subsequently reconcile any conflict between those provisions.
By not analysing where the provisions pulled in different directions and reconciling any conflict, the High Court commented that the Environment Court effectively employed an "overall judgment" approach, which was rejected by the Supreme Court in King Salmon. The Environment Court's error was found to have affected the outcome of its decision, as provisions which pulled in the direction of limited subdivision in the rural environment were not properly considered and analysed.
The decision highlights the importance of decision-makers expressly referring to the relationship between any relevant provisions in the higher order planning documents and how any tensions between those provisions should be resolved. When it comes to resolving any conflict, decision-makers would do well to consider the guidance of the Supreme Court in King Salmon that:
- The need to consider differences between activity statuses in the RMA
The decision confirms the need for decision-makers to carefully consider the differences between the activity statuses provided in the RMA. In this case, the key difference between the rural subdivision provisions proposed by the IHP and the Council was that the IHP's provisions provided for more restricted discretionary activity subdivision opportunities than the Council's provisions. In contrast, the Council's proposed provisions resulted in a non-complying activity status being triggered more easily.
The Environment Court found that, regardless of the activity status, issues as to rural character and amenity, natural character and features in significant ecological areas will all be relevant to the Council's assessment in any particular resource consent application. Therefore, it found that the critical factors applying to any resource consent application would be the same regardless of whether the activity was classified as restricted discretionary, discretionary or non-complying.
The Council submitted that the Environment Court erred by not recognising that different considerations would apply to the assessment of restricted discretionary, discretionary and non-complying activities, which would affect the Council's ability to turn down subdivision applications. This included the relevance of plan integrity/precedent effect considerations.
In zones which required a careful consideration of subdivision applications, the Environment Court preferred an approach which looked at each application on a case-by-case basis, relying on restricted discretionary activity assessment criteria, as opposed to plan provisions which could result in a more onerous activity status for subdivision applications in those zones. However, the High Court stated that in this case a restricted discretionary classification was not appropriate in zones where a detailed scrutiny of future resource consent applications is necessary.
Another implication of the decision is that precedent effect and plan integrity should not be forgotten when setting activity statuses for relevant activities. The decision affirmed the well settled principle that, although a decision on one resource consent does not create a legally binding precedent in respect of a similar application, the precedent effect of treating like cases alike is a relevant factor for a consent authority to take into account under section 104(1)(c) of the RMA. Unless the issue of precedent effect is a matter for which discretion is reserved under the Plan, then a consent authority is unable to take it into account in the assessment of a restricted discretionary activity. Therefore, the issue of precedent effect in this case indicated that different considerations may apply to the assessment of rural subdivision applications for restricted discretionary activities as opposed to applications for non-complying activities.
Extra point to note: importance to give reasons
One further point to note is that the decision reiterated the obligations of resource management decision-makers to give reasons for their decisions, a matter which was also discussed by the Court of Appeal in Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel  NZCA 175. The key takeaway for plan makers from these two decisions is to ensure the "why" of a decision is stated. Readers should be able to understand the intellectual route taken by a decision-maker when deciding to accept or reject a submission.
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.