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Mark v Attorney-General [2011] NZCA 176; [2011] 2 NZLR 538; [2011] NZRMA 437 (6 May 2011)

Last Updated: 25 January 2018

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IN THE COURT OF APPEAL OF NEW ZEALAND
CA722/2009
[2011] NZCA 176
BETWEEN YOLANDE ELISABETH MARK & ORS
Appellants
AND THE ATTORNEY-GENERAL OF NEW ZEALAND
First Respondent
AND THE CHIEF EXECUTIVE OF LAND INFORMATION NEW ZEALAND
Second Respondent
AND NEW ZEALAND TRANSPORT AGENCY
Third Respondent
AND KAPITI COAST DISTRICT COUNCIL
Fourth Respondent
Hearing: 22-23 March 2011
Court: O'Regan P, Glazebrook and Stevens JJ
Counsel: J B M Smith and W L Aldred for Appellants
J R Burns for First and Second Respondents
B A Scott and G K Rippingale for Third Respondent
D J S Laing for Fourth Respondent
Judgment: 6 May 2011 at 12.30 pm

JUDGMENT OF THE COURT

A The appeal is dismissed.

  1. The respondents are entitled to costs on a complex appeal on a band A basis plus the usual disbursements. We certify for second counsel.

____________________________________________________________________

REASONS OF THE COURT
(Given by Stevens J)

Table of Contents

Para No
A highway from Wellington to Foxton [1]
The issues for determination [6]
Factual background [11]
The High Court decision [42]
Our evaluation – a summary [48]
Applicable legal principles – stepped or merged approach [54]
Public work for which the land was acquired [67]
Is the land no longer required for that public work? [74]
Is the land not required for any essential work? [86]
Discretionary relief [88]
Result [95]
Costs [96]

A highway from Wellington to Foxton

[1] To this day State Highway 1 passes through the townships of Paraparaumu and Waikanae as it heads north out of Wellington to Foxton. The same road also serves a local traffic function in the growing Kapiti Coast region. Between 50 to 60 years ago private land in the area was acquired by the Crown under the applicable public works legislation for the purposes of a new motorway from Wellington to Foxton. Since that time, the relevant government and local body agencies, as well as members of the public, have considered and debated the various roading options. But no motorway or road of any kind has yet been built on the acquired land.
[2] The case concerns whether, as at December 1985, the Crown was required to offer the acquired land back under the Public Works Act 1981 (the Act) on the basis that it was no longer required for the public work for which it was held. Section 40(2) of the Act may have required the Commissioner of Works (as the relevant person then was) to offer to sell the land back at the then current market value to the person from whom the land was acquired or the successor of that person. The appellants comprise the owners or their successors of five parcels of land in an area between Poplar Avenue and Raumati Road in the township of Raumati, to the west of State Highway 1.[1] Each of the appellants has entered into agreements to on-sell to Addington Property Group Ltd, formerly Pritchard Group Ltd (Pritchard), any land they may acquire by way of offer back under the Act.
[3] The appellants’ claims to have the land offered back to them were dismissed in the High Court.[2] Mallon J held, in summary, that all of the acquired land was throughout the relevant time period required for a public work, albeit that such work was not the public work for which the land was originally acquired and held. No obligation to make an offer back to the appellants arose. The Judge concluded that: “Although there was a period of indecision as to whether any road would be built and if so by whom at no stage was it decided that a road of some kind would not be built on the land.”[3] It is from this decision that the appellants appeal arguing that the conclusion that the land was required for a public work was erroneous.
[4] In the course of the Judge’s analysis, she made a finding that as at 11 December 1985 the land was no longer required for the public work for which it had been acquired, namely, the Wellington-Foxton motorway.[4] This conclusion is challenged by the respondents who say in summary that at no time could it be said that the acquired land was no longer required for the public work for which it was acquired and held.[5] The respondents challenge that aspect of the judgment while seeking (if it is necessary to do so) to uphold the Judge’s determination that the land was at least required throughout for another essential work.[6]
[5] We conclude the introduction by mentioning that in March 2009 the Wellington Airport to Levin route (Wellington Northern Corridor) was identified by the Minister of Transport as one of seven Roads of National Significance. These are essential routes across New Zealand that require work to reduce congestion, improve safety and support economic growth. The purpose of listing roads as “nationally significant” is to allow the government to have input into the development of the land transport programme and the National Infrastructure Plan from a nationwide perspective and to signal the significance of the roads to the country as a whole.

The issues for determination

[6] As noted, the appellants’ claims concerning the acquired land arose under s 40 of the Act. The relevant provisions as at 1985 stated:

40 Disposal to former owner of land not required for public work

(1) Where any land held under this or any other Act or in any other manner for any public work—

(a) Is no longer required for that public work; and

(b) Is not required for any essential work; and

(c) Is not required for any exchange under section 105 of this Act—

the Commissioner of Works or local authority, as the case may be, shall endeavour to sell the land in accordance with subsection (2) of this section, if that subsection is applicable to that land.

[7] The terms “public work” and “essential work” were respectively defined as follows:

“Public work” and “work” mean every work which the Crown or any local authority is authorised to construct, undertake, establish, operate, or maintain, and every use of land which the Crown or any local authority is authorised to establish and continue, by or under this or any other Act; and includes any thing required directly or indirectly for any such work or use:

“Essential work” means any public work that is, or is required for,—

...

(f) Any road, motorway, access way, service lane, railway, or aerodrome; or

[8] Given the statutory context, a number of issues arise for determination. In the circumstances of this case they are of an intensely factual nature and will require us to evaluate a considerable amount of documentation including correspondence, reports, minutes of meetings, newspaper reports,[7] as well as the official records concerning the acquisition of the acquired land. In addition, the historical documentation has been supplemented by affidavit and other evidence from some of those involved during various periods of the chronology.
[9] From the totality of the evidence, the following questions require determination:
[10] In identifying these questions, we have not overlooked the point raised by the respondents concerning the validity of the assignment from the appellants to Pritchard. The respondents argue that rights under s 40 of the Act are not capable of assignment. They say that, on the facts, Pritchard acquired its rights to conduct the litigation by means of an unlawful assignment. Given the conclusions we reach on the questions raised under s 40, we do not need to determine this point. No allegation of champerty is made by the respondents and we therefore express no view as to whether the arrangement between the appellants and Pritchard is champertous. It is sufficient to observe that we are content to accept the views of Mallon J that there is no need to go behind the contractual arrangements with Pritchard unless a claim of champerty is made.[8] We are satisfied, as was Mallon J,[9] that the appellants have standing to bring the claims.

Factual background

[11] Shortly after World War II, the Government began to focus on building State highways, including one between Wellington and Foxton. A report in May 1946 suggested the construction of a new road between Paekakariki and Waikanae rather than attempting to widen the existing one. A principle of “limited access” to major roads was proposed, even though at the time no legal ability existed to restrict access.[10] In 1949 the Governor-General authorised the construction of a motorway between Wellington and Foxton. Between 1950 and 1955, the five parcels of land (the acquired land) were purchased by the Crown under the Public Works Act 1928 (the 1928 Act). A proclamation establishing the “middle-line” of the proposed motorway followed in 1956.[11] The new motorway would pass through the acquired land along what is sometimes referred to as the Sandhills route. Subsequently, budget constraints led to a decision that no new motorway construction was to be approved. Rather, State Highway 1 was to be upgraded. But the motorway proposal was not abandoned. Approval was given in 1957 to complete plans for, and the design of, the motorway and to purchase land as and when necessary so as to secure the route for future use.
[12] Almost a decade later, in 1965, the Minister of Works made a requirement for the provision of a motorway in the Hutt County Council District Scheme.[12] The motorway corridor that resulted largely followed the route of the 1956 middle-line proclamation. It still remained for all of the acquired property, despite having been bought by the Crown several years earlier, to be formally acquired by the Crown through the process of gazetting. That did not occur until 1972. In 1973 the Hutt County Council formed a Joint Working Committee with the Ministry of Works (MoW) to develop a structure plan for establishing the infrastructure requirements for Paraparaumu. Later, the local authority for the area became the Kapiti Borough Council (KBC) which replaced the Hutt County Council on the Joint Working Committee. The proposed motorway was part of this exercise. The Joint Working Committee considered the relationship of the motorway to local transportation networks and whether alternative routes should be considered. At a meeting of the Joint Working Committee on 23 April 1974 it was agreed that, if the proposed motorway did not proceed, there would still be a need for a major distributor route such as an expressway serving the local transportation requirements for the district. Alternative routes were considered and the Joint Working Committee advised the MoW in October 1974 that the motorway should remain in its present position. It was contemplated that, at least in part, the road would not be a motorway, but would act more as “a major distributor”.[13]
[13] In 1976 KBC as the relevant local authority at the time reviewed the Kapiti Borough Scheme. The revised scheme included a corridor for an “expressway” defined as covering “motorways and their initial construction serving an interim function as major arterials”. During the review of the scheme, the National Roads Board (NRB), which was the government body then holding the acquired land, itself began revising the requirement for the proposed motorway. An NRB submission in December 1976 described the roading pattern for the Paraparaumu section as being “based on a limited access road or expressway along the motorway line”. Subsequently the Minister of Works formally notified KBC by way of the 1976 Requirement for a “Proposed Road with Motorway and Railway”.[14] Although the 1976 Requirement referred to a motorway, the district scheme termed it an “expressway”, as the Hutt City Council District Scheme had done in 1965.
[14] In the early 1980s MoW commenced the Western Corridor Study. This was to assess the roading needs for an area that included the subject land. As the appellants’ submissions focus critically upon the events of this decade some further detail as to what then occurred is necessary. The Western Corridor Study advanced three options to deal with the traffic flow, namely, to:
[15] The resultant report favoured upgrading State Highway 1 and removing the motorway designation over the subject land. A draft of the report in 1984 recommended:

that the through option [four-laning State Highway 1] is endorsed in principle subject to further detailed design in consultation with Kapiti Borough. Subject to a satisfactory outcome to these discussions the motorway designation from McKays Crossing to Otaihanga should be uplifted.

[16] The view was expressed within MoW in May 1984 that definite proposals should not be put forward to NRB until the possibilities had been discussed with KBC and local interests. Mr Burt, on behalf of the Commissioner of Works, said:

You should be discussing the possibilities with Kapiti Borough Council and local interests before making any definite proposals for adoption by the Board. Remember that while the requirement route may not seem economic at present, at least it is there and protected within the district scheme for future development. We cannot afford to release it until a useable alternative is available.

[17] In June 1984 NRB requested the MoW to prepare a report on practical options for upgrading State Highway 1 after discussions with local authorities. NRB also confirmed the retention of the existing motorway requirement until other options could be further considered. The context in which such consideration was occurring, and the long term nature of the issues being assessed is evident from a letter from MoW to a local resident in November 1984. The letter stated:

The two basic options for State Highway No.1 through Paraparaumu are that

either it remains in its existing location,

  1. it follows the expressway route as shown in the Kapiti Borough district scheme.

It is expected that a decision on future strategy will be finalized in the first half of 1985. But even if the highway were to be rerouted to follow the designated expressway route, I would not expect this to happen inside 15 years or very likely considerably longer.

[18] In early 1985, prior to the completion of the Western Corridor Study, KBC began their own roading study by instructing Gabites Porter to reassess the present and planned roading hierarchy for Kapiti and the borough’s requirements, and to consider whether the motorway designation should be retained. The report was not released until March 1989. Incidentally, it supported KBC’s position that the designation over the subject land should be retained for the construction of a four-lane facility.
[19] Meanwhile, in February 1985 the first edition of the Western Corridor Study was released for consultation. All relevant local authorities opposed the recommendations made. In particular, the KBC wrote to MoW reporting on two meetings with resident ratepayers and members of the business community. The letter referred to a KBC resolution from its 24 April 1985 meeting recommending that “the motorway designation remains in place and that a four lane highway on State [Highway] One not be introduced”. KBC proposed a meeting with interested parties to discuss the matter.
[20] The letter also provided detailed elaboration as to the reasons for the opposition as follows:
  1. The existing sandhills motorway designation has been in position for nearly three decades. It is therefore not unexpected that most land owners in this time were aware of the proposal. The current Kapiti Borough District Scheme Plan has been designed around the use of the motorway in the future. Hence both ratepayers and Council’s reasonable expectations will be extremely adversely affected by any change of the designation in the borough urban area. ...
  2. The term of the study period, i.e. up to 1996, appears to be too short on which to make the major decision suggested by the report. While the difficulty of planning beyond this 11 year period is appreciated, particularly with base figures already over three years old, the fact remains that the uplifting of a 30 year old designation with its resultant replanning and environmental aspects cannot be supported on the data available.

[21] In July 1985, the NRB received submission no. 8404 from the Director of Roading about the available options involving State Highway 1 in the light of the Western Corridor Study. The submission contained the following comments about the suggested four laning of State Highway 1:

The report comes out in support of widening the existing road to four lanes and removing the motorway requirement. On the costings produced this is certainly the correct technical solution, but it is counter to the views expressed by the Kapiti Borough Council. Roading Directorate has some concerns over the standards and costs adopted for the proposals within the critical areas through Paraparaumu, as well as the environmental effects this may have. The report recommendations indicate that further investigations are desirable before this option is adopted and this is agreed as being necessary in view of the potential for increased costs for upgrading the existing route.

[22] The submission acknowledged that there was “little technical reason to support the retention of the motorway requirement”. But the resolutions of the NRB following consideration of submission no. 8404 are instructive, namely, that the NRB agrees:

(c) ... that provision be made for future provision of four lanes generally along the route of the existing highway between Te Moana Road, Waikanae and Otaihanga Road, and defer the uplifting of the Ministerial Requirement until comment has been received from the District Roads Council and the County Councils concerned.

(d) that in view of local concerns expressed over the proposals for future upgrading of the existing highway to four lanes between Otaihanga Road and Poplar Avenue, a decision to uplift the existing motorway designation be deferred pending refinement of the costs involved; and

(e) that these resolutions be conveyed to the No. 9B District Roads Council for comment prior to final endorsement by the Board.

[23] Comments in the media following the July meeting of the NRB provide further context to the deliberations of the time. Mr Burt of MoW, who signed submission no. 8404, is quoted as saying that “further investigation was desirable because there was potential for the cost of upgrading the present highway to escalate”. He said that “there also appeared to be room to reduce the estimated cost of building a sandhills bypass that would make that option more economically viable”. The article also records Mr Burt as having told the NRB that widening the present highway would involve blasting a way through the existing Paraparaumu township. Moreover, Hon F M Coleman, the Chair of the NRB, stated that “highway development in the area would be needed one day, and the matter should be deferred so the right decision could be made”.
[24] In August 1985 KBC told MoW that it was “most unhappy with recommendation (c)” and suggested that the motorway designation “should be confirmed to provide ultimately for a 2 lane by-pass of Waikanae”. The same correspondence expressed a hope that NRB’s decision to “defer uplifting the existing motorway designation pending refinement of the costs involved” indicated some flexibility with any decision of the NRB regarding the future motorway. Overall, a new report was expected to give a clearer picture of the merits of the bypass options along the Sandhills route for both Waikanae and Kapiti.
[25] Further work was carried out to determine whether a cost reduction was possible for the bypass option. Mr Burt for the Director of Roading presented a further submission to NRB in September 1985 outlining the costings for the two options. The submission from the Director of Roading examined positive and negative factors for both before concluding that: “There is not a great deal between the two proposals.” Funding issues were raised including the “competition for funds nationally”. The submission came before NRB at its September meeting and an onsite meeting followed on 16 October 1985. Media coverage at the time suggested that the NRB “may have swung back to a 30-year-old plan that would bypass [Paraparaumu]”. Local authorities and the District Road Council confirmed their support for the retention of the motorway designation.
[26] A further submission was made by MoW to NRB in December 1985. The upgrade of State Highway 1 was recommended as the appropriate option. But importantly KBC was to be offered the option of constructing a bypass from Otaihanga Road to Poplar Avenue within the existing designation as a subsidised work with up to 75 per cent funding. This proposal reflected a new NRB funding policy. The NRB considered the submission on 11 December 1985. The recommendations were adopted and the NRB resolved that it:
[27] The NRB deliberations were reported in the media. The Chair, Hon F M Coleman, is reported as saying that “opting to four-lane the present route would sell short locals who had exercised foresight in setting aside land for the bypass. It would devastate the part of town the highway now ran through.” One board member commented that “a new highway could be 20 years away”, while another queried “whether locals realised just how far away [the] new road was, and how much it would cost the borough to build it”.
[28] The NRB wrote to KBC on 16 December 1985 advising of the outcome of the meeting of 11 December 1985 and providing details of the NRB resolutions. Because of its importance to our evaluation, we set out key portions of the letter:

The Board took account of the reviewed costings supplied by the District Commissioner of Works, Wellington following discussions between the Ministry of Works and Development staff and Kapiti Borough Council staff, as well as the factors raised in your letter, and the resolution passed by the No. 9B District Roads Council at its meeting held on 30 October 1985.

The new costings have brought the alternatives of upgrading the present highway to 4 lanes, and the building of a new expressway facility within the designated motorway reserve closer together. However the latter can provide very few benefits for the State Highway through traffic until the new roadway is completed from Otaihanga Road through to Poplar Avenue. Any earlier stages will be of use only to locally generated traffic from within Kapiti Borough. Furthermore the benefit/cost ratios calculated for both alternatives are such that none of the works in either project could be expected to feature within State Highway construction programmes for some years when considered in competition with other roading projects being sought elsewhere throughout the country.

The Board has recognised that it has a significant number of projects awaiting attention on its State Highway system which would take the highway route out of residential and commercial areas, with environmental benefits accruing for residents of the area as well as cost benefits for the highway users. Because many of these are unlikely to be included on highway programmes for some years the Board has recently adopted a new policy which will enable the local authorities to undertake these works at an earlier date as part of their subsidised roading programmes if they wish.

The new policies to apply for construction of highway bypasses is:

(a) All State Highway relocations which have a benefit cost ratio of two or greater be fully funded from the State Highway sector.

(b) Where the user benefit cost ratio is less than two the work may be considered for funding as a subsidised work with a subsidy rate up to a maximum of 75%.

(c) In exceptional circumstances where additional special factors of a non quantifiable type pertain which benefit the “road users” the District Roads Council may recommend for the Board’s consideration and decision that the work be funded totally as a State Highway work.

...

The matter is now referred for your Council’s consideration. Could you please advise me of decisions it takes in due course to enable the Board to finalise its future strategies, particularly in regard to planning requirements involved.

[29] KBC considered the offer of the funding subsidy for the bypass. The reaction was negative. It was seen to raise safety issues that would put the public at undue risk at crossing points. In a letter to MoW on 24 March 1986, KBC stated:

For all of the reasons already stated Council does not want the present highway four laned. It is felt strongly that NRB and your Department has a moral obligation not to increase the danger and inconvenience to our citizens and visitors on the grounds of incremental cost benefits in improving the through traffic capacity of the present highway.

This Council has a loan debt for public health services of $15.0 m and present interest rates on repayments mean that it cannot afford to incur further debt by borrowing to finance even part of the proposed roading costs.

...

No allowance has been made in your four laning the present highway proposal for a complete rehash of our District Scheme in respect of roading. We do not carry staff skilled in traffic engineering and would need to employ consultants at a cost of say $50,000 to $100,000.

...

National Roads Board has virtually given Council an ultimatum to either accept the four laning of the present highway or provide funds (which it hasn’t got) towards building a bypass. The fact that it has agreed to retain the motorway designation through Waikanae if Kapiti agreed to partial funding of a bypass is unfair to Waikanae residents as they have no control over Kapiti Borough Council policy or finances.

In conclusion I must emphasise that despite Council’s inability to meet part of the cost of a bypass it still considers that the sandhills motorway designation should be retained as a Ministerial requirement.

[30] NRB met again in August 1986 to consider a further submission from the Director of Roading that acknowledged KBC’s opposition to a development of four lanes on State Highway 1 and KBC’s view that construction of a bypass was “a State Highway work”. A review of costings had been requested in the hope that this might “improve the economics”. Pending that review, the options for NRB were:
[31] The submission stated that KBC “obviously wishes to see the corridor protected” and recommended:

That in connection with the future development of S H 1 through Kapiti Borough the Board:

  1. notes the views expressed by the Kapiti Borough Council supporting retention of the bypass designation;
  2. agrees to have the designation retained for 3 months to enable the Kapiti Borough Council to introduce a scheme change to its District Scheme to preserve a designation over the bypass route;
  3. agrees that works will be carried out on the existing State Highway route to relieve critical sections as the need arises; and
  4. advises the No. 9B District Roads Council and Kapiti Borough Council of these decisions.
[32] This recommendation was adopted by NRB. By a mistake, the new proposal was not communicated to NRB until 16 October 1986. The three month time limit in resolution (b) ran by agreement from that date.
[33] In November 1986 KBC asked NRB to reconsider its position, particularly because the District Scheme was then under review. KBC suggested it would be “imprudent and contrary to sound town planning practice to make any move to uplift the present designation until an alternative is in place”. Importantly, KBC added:

If the Kapiti Borough does become responsible for protecting the designation then we assume the land now owned by the Ministry of Works and Development along the route would be vested in the Borough so that we could rationalise this investment to secure additional land required.

[34] The Horowhenua County Council also wrote to NRB urging it not to take any action to uplift the motorway designation for the section Poplar Avenue to Peka Peka Road, which included the acquired land. This would give the local authorities further time to resolve matters with NRB within a suggested timeframe of 12 months.
[35] In December 1986, NRB wrote to KBC outlining its views of the position reached and inviting further comments from KBC. Because the contents of the letter are relied upon by both appellants and respondents, we include the relevant parts as follows:

Firstly it is agreed that the present designation [through Kapiti Borough] is for a motorway and retention of a motorway designation requires the Minister of Works and Development to accept responsibilities associated with it. This normally would involve the National Roads Board in meeting any funding requirements associated with land purchase. However a change to regional motorway status with the Board‘s approval, and acceptance of responsibilities by the regional local authority would be a possible alternative.

This raises the question of the need to have the route designated as motorway. It could be covered by a limited access road designation instead which would prevent adjoining land from having legal access to it but would still allow use by all forms of traffic i.e. pedestrians, cycles and stock as well as vehicles. This status would probably be adequate from the Board’s viewpoint although motorway status would be preferable if it were to become State Highway No. 1. Limited access road status would enable your Council to arrange an alternative requirement should the Minister remove his motorway designation.

From the viewpoint of the National Roads Board removal of the motorway designation is something it is not able to do itself. This is a matter for the Minister to arrange, but the Board is able to indicate to the Minister that it is not prepared to support the motorway designation with its associated commitments, effectively resulting in its removal.

It is these commitments which the Board wishes to avoid. Apart from the cost of land purchase involved, there are substantial costs and staff resources involved in administering the designation, and particularly in defending it at planning hearings. It is this latter aspect which I believe to be of greatest concern to the Board. It has received reports indicating that the present road reserve could be developed to 4 lane standards, although some improvements involving encroachments outside the present highway reserve are obviously desirable. The development of a new facility on the motorway designation as your letter indicates is thus a matter of direct interest to your Council and its planning of the future form of the Borough. Because little benefit accrues for the highway the Board believes your Council should accept the responsibilities associated with designating the new route and defending the planning and environmental issues involved.

The Board also realised that if an alternative form of protection is to be adopted, it would be undesirable to uplift the motorway designation and leave the corridor unprotected while your Council arranges this to be included in its district scheme. The aspect of the scheme review was mentioned but after some discussion it was agreed by Board members that the change should proceed ahead of the review with a three months period accepted for your Council to arrange the alternative protection.

I believe the Board wishes to assist your Council as far as it is able in handling these alternatives but it has clearly indicated that it wishes to withdraw from direct involvement in any planning disputes arising during the scheme review. ...

To summarise the position ... [i]f the Borough wishes to retain the motorway corridor in a form which will enable a suitably protected route to be constructed at some future date this could become the State Highway route but there can be no commitment of highway funding for the project at this stage.

Protection of the corridor could be by a limited access road designation from your Council. Alternatively and not yet to be considered by the Board, your Council may be able to have the Minister retain the motorway requirement on the understanding that defence of any planning objections would be handled on the Minister‘s behalf by your Council.

[36] Between December 1986 and early 1989, there was ongoing correspondence between KBC, Horowhenua Borough Council and NRB. State Highway One Residents Association (a group opposed to the upgrade of State Highway 1) also engaged in correspondence, including with the Minister. NRB responded in August 1987 to a query from a resident as to when the motorway proclamation was likely to be lifted. The letter stated that the proclamation “is at present being retained as the Kapiti Borough Council have requested continuation of the designation while they consider certain planning issues within the Borough. Until these are completed the proclamation will remain.”
[37] The Minister himself had earlier written to an interested resident confirming that NRB had given a clear indication that it no longer wished to accept commitments associated with maintaining the motorway designation.[15] The Minister emphasised that the designation was his but he required an “assured source of financing for any commitments”. He added:

The Board has acknowledged that it would not be prudent to have the designation removed without allowing the local authority time to make these alternative arrangements and has set a period of three months for this to be achieved. However, I believe it is prepared to allow some flexibility on this and will endeavour to assist the Borough to bring about a reasonable solution. Negotiations to this end are in hand between the Board and the Borough Council.

[38] Meanwhile, KBC was awaiting the Gabites Porter roading study. This was released in March 1989 and supported KBC’s position that the designation over the acquired land should be retained for the construction of a four-lane facility. At a subsequent meeting involving KBC and Horowhenua County Council, NRB officers referred to the NRB resolution not to uplift the motorway designation until the local authorities placed an alternative appropriate designation.
[39] Later in 1989, Transit was established to take over the responsibilities of NRB. Transit released a discussion paper on the motorway in 1990. It considered that the motorway designation should be uplifted, but only after KDC had been given the opportunity to “safeguard an arterial route along the present designation”.
[40] In the same year, the Kapiti Coast District Council (KCDC) became the territorial authority for the relevant area. A joint study undertaken by Wellington Regional Council, Transit and KCDC in the early 1990s resulted in a recommendation that a western bypass route should be confirmed in the district plan. A supplementary report released by Works Consultancy Services reiterated that upgrading State Highway 1 would not achieve the same roading benefits as a western bypass. As a result, Transit forwarded a Notice of Requirement under the Resource Management Act 1991 dated September 1994 to KCDC. The requirement was a designation for a “proposed limited access road” that would bypass key townships on the Kapiti Coast and replace State Highway One. Such requirement would replace the designation for a motorway or expressway over the subject land that had existed since the 1960s.
[41] In 1995, the Kapiti Roading Study: Network Definition report was released. Transit and KCDC consequently agreed to maintain State Highway One on its existing alignment and construct a local arterial road. KCDC would become the landholding agency and be responsible for the project’s development. On 20 January 1998, KCDC issued a Notice of Requirement for a ‘Western Link Road’ that made use of the subject land. The designation for the Western Link Road was confirmed in 2006. Since that time no road has been built. But, as noted at [5] above, the Wellington Northern Corridor was in 2009 identified as a Road of National Significance. There have been recent proposals to build a State highway on the Western Link Road.

The High Court decision

[42] Relevant to the key issues for determination concerning s 40(1) of the Act, Mallon J examined the appellants’ argument that by December 1985 at the latest, a decision had been made by NRB not to build a motorway and that KBC did not within a reasonable time require the acquired land for another public work. The Judge considered the first and second elements of s 40(1) of the Act separately in order to determine whether the offer back provisions of s 40(2) had been triggered. As a preliminary step, she held that the acquired land had been purchased under the relevant Public Works Acts for a specific purpose: the construction of a motorway, or possibly a road that was functionally equivalent.[16]
[43] Next, the Judge considered the s 40(1)(a) issue of whether the acquired land is no longer required for that public work. In determining this point the Judge referred to the test of this Court in Attorney-General v Hull of requiring an “assessment of intention in the light of objective circumstances”.[17] The Judge considered the critical time as being December 1985 and held:[18]

At this point NRB no longer intended to build a motorway on the designated route and was prepared to offer KBC the route. It had in mind a bypass of the highway to which it would contribute funding. But it also intended that KBC would take over the designation. While the bypass would benefit the north-south thoroughfare on State Highway 1, by offering the route to KBC NRB must have been contemplating a road that was for the benefit of KBC‘s local roading needs.

[44] The Judge also referred to the evidence from the witnesses and concluded:[19]

But there is no suggestion in the documents at this time that there was any indecision on NRB’s part about whether there would be a motorway (or state highway) built on the route. Mr Langbein did not say it was still being considered – but rather says that the land was held “for the purpose of constructing a motorway or by then what had become known as a bypass” (my emphasis) and when pressed in cross-examination was not able to say that a motorway was being considered.

[45] This reasoning resulted in a finding that as at 11 December 1985 the acquired land was no longer required for the public work for which it had been acquired, namely, the Wellington-Foxton motorway.[20]
[46] On the second issue of whether the acquired land was required for any other public work, the Judge considered the correspondence, particularly the NRB letter to KBC dated 16 December 1985, set out at [28] above and held:

[240] ... The letter does not show that NRB considered that the land was not required for any public work. Rather this letter and the later letters in December 1986 ... show that NRB considered that the land might well be used for a public work and that the future corridor should be protected. It also recognised that if it was retained and a route was “constructed at some future date this could become the State Highway route”.

[241] The response from the local authorities in 1987 was that they wanted the designations in place. NRB did not uplift the designation in 1987 (despite having earlier set a deadline) and by May 1988 the Minister was assuring the local authorities that a final decision on the future of the motorway designation had not been made. Meanwhile the local authorities had commissioned a report which, when released in March 1989, supported the case for a four lane facility on the designated route rather than over the State Highway 1 route. All of this is consistent with both sides envisaging the land being used for a road of some kind. At no point did the local authorities or NRB have the view that no road should be built on the route. The ensuing correspondence and studies were about what road, eventually leading to the 1994 Requirement (and later the current designation).

[242] In this case, as at 11 December 1985 it was not a situation where the landholding agency was faced with a binary decision: that is, it was not the position that if a motorway was to be built the land was required and if a motorway was not to be built it was not required. This contrasts with, for example, the position in Horton (PC)[21] at p 262 where the requirement for the land depended on whether the agency intended to mine the area. Nor was it a case where, if the landholding agency did not require the land, it was unknown whether any other agency had any need for the land such that the Chief Executive of LINZ needed to make an inquiry (as was contemplated in the Court of Appeal’s discussion of s 40(1)(b) in Morrison[22] at [20]).

[243] The facts show that, although there was not genuine indecision as at 11 December 1985 as to whether the land was required for a motorway (it was not so required), there was genuine indecision as to what the route should be used for and who should bear the costs of protecting the route. The indecision arose because of the different views as between NRB and KCDC about this. In these circumstances I consider that the land could still be required for another public work (so that s 40(1)(b) was not met) despite it not being known whether any road would be built, what kind of road, when and at whose cost. No decision had been made as between NRB and KCDC that the land was not required.

(Footnotes added.)

[47] As a result of these findings, the Judge held that the requirement in s 40(1)(b) was not met. Therefore the obligation in s 40(2) of the Act to offer the acquired land back to the appellants did not arise.

Our evaluation – a summary

[48] The case for the appellants is in essence that in December 1985 there was a short period during which NRB maintained it would not build the motorway as it had opted for upgrading State Highway 1 to four lanes. At that point there had been a triggering of s 40(1)(a). Given that NRB considered that it would be beneficial if the local authorities were to construct an alternative type of road, namely, a long term highway bypass from Otaihanga Road to Poplar Avenue within the existing motorway designation (assisted by a generous funding contribution from the NRB), that gave rise to the question whether s 40(1)(b) had been triggered. As the local authorities did not take up the offer within a reasonable period after the NRB expressed its decision not to use the land for a motorway, there was no basis for showing that the land had become required for another essential work under s 40(1)(b). The state of indecision between NRB and the local bodies was not sufficient to bring the case within s 40(1)(b) because the NRB had committed itself in December 1985 to the position that the acquired land was no longer required. A positive action on the part of the local authority to take over the acquired land was therefore absent.
[49] One means of evaluating the appellants’ case is by applying what we will refer to as the “stepped approach” which draws a bright line between the two statutory requirements in s 40(1)(a) and (b) of the Act. The appellants support this approach. An alternative methodology is to merge the two separate requirements in s 40(1)(a) and (b) and focus on whether the acquired land was still required for a public or essential work. In other words, one would consider together whether the acquired land was in December 1985 no longer required for the original or any other public work. Our discussion about the applicable legal principles will deal with the question of what is the test to be applied in the context of this case.
[50] Applying the merged approach, we consider that the acquired land was in substance only ever required for one intended use, namely, the construction of a major arterial route, whether classified as a motorway, expressway, limited access road, bypass or State highway. All of these types of roads would serve essentially the same function – a high speed through road for motor vehicles with access only onto the road from other roads and not directly from adjoining properties. We agree with the respondents that at least from the 1970s it has been recognised that such a road would be of great benefit to both the State highway network and to the district roading network. In terms of implementation, the issues to be resolved related to the precise form of major arterial road to be constructed, funding, timing, classification of the road, planning/resource management issues and the potential involvement of local as well as central government.
[51] Even if we are wrong in the application of a merged approach to the circumstances of this case, we are satisfied that the outcome would be the same applying the stepped approach. On this analysis, we differ from the conclusion of Mallon J and consider that the requirement under s 40(1)(a) of the Act, that the acquired land held for the purpose of a major arterial route is no longer required for that purpose, has not been satisfied on the facts. We consider as at December 1985 the acquired land was still required for the public work for which the land was originally required. Our detailed outline of the reasons for these views will be given when we consider the questions for determination.
[52] Even if we were wrong on this point, we have no doubt that the requirement in s 40(1)(b) of the Act has not been met. On this aspect, we agree with the views expressed by Mallon J in the High Court as set out at [46] above.
[53] Given these conclusions, there is no need to address in any detail the final question dealing with the discretion to grant declaratory relief. However, we will briefly mention certain factors relevant to the discretion issue later, once we have given closer analysis to the relevant factual findings that support our conclusions.

Applicable legal principles – stepped or merged approach

[54] As already noted, an important legal question in the case involves the nature of the test to be applied under s 40 of the Act. The appellants submit that the correct approach is the one implicitly followed by the Judge in the High Court involving a “stepped” methodology. This provides first for a determination of the question whether the land is “no longer required” under s 40(1)(a) and then a second and subsequent inquiry as to whether it is “not required” for another essential work under s 40(1)(b). Judicial support for the stepped approach is found in the judgment of this Court in Attorney-General v Hull.
[55] In that case, Keith J, writing for the Court, stated:

[41] The first, and usually determinative criterion in s 40 is satisfied when in terms of subs (1)(a) the land is no longer required for the purpose for which it was taken. Whether that is so is a question of fact involving an assessment of intention in the light of objective circumstances. Proof that the land is no longer required for the relevant public work may be achieved by demonstrating an affirmative decision to that effect. The point can also be established by examining the conduct of the body holding the land and, if appropriate, drawing an inference that the body has concluded that it no longer requires the land for that work. Alternatively, the evidence may establish that that was not the case and, for instance, that the landholding agency remained in a state of genuine indecision. But if any reasonable person would undoubtedly have concluded that in all the circumstances the land was no longer required for the relevant public work, the agency may well have difficulty asserting that it had not so concluded, and therefore had not come under any obligation to proceed in terms of the section.

...

[43] Once para (a) of s 40(1) is satisfied, we consider that the landholding agency, the Chief Executive of the Department of Lands or both are obliged to take reasonable steps to ascertain whether the land is or is not required in terms of paras (b) and (c). If, after reasonable inquiry, no such requirement emerges, the Chief Executive must act in respect of the land in accordance with s 40(2).

[44] The Chief Executive must give bona fide and fair consideration to whether the statutory course of offer back would be impracticable, unreasonable, or unfair under subs (2) or whether in terms of subs (4) the land is instead to be sold to an adjacent owner. Unless one of those exceptions applies, the Chief Executive must offer the land back to the original owner.

[56] The respondents contend that the stepped approach to s 40(1) of the Act, with separate inquiries under paragraphs (a) and (b), was not intended to be of universal application. Mr Scott submits that recent authorities recognise that in some cases it is appropriate to take a merged approach and to ask simply whether the land was no longer required for a public work. In this context Mr Scott emphasises that there are not two distinct public works with a bright line between them. He submits that for over five decades there has been in substance only one intended use for the land, namely, the construction of a major arterial road, whether classified as a motorway, expressway, limited access road, or State highway. He contends that all of these roads would serve the same essential function being that of a high speed through road for motor vehicles with access onto the road only from other roads and not directly from adjoining properties. He submits that from at least the 1970s it has been recognised that such a limited access road would be of great benefit both to the State highway network and the district roading network. However, issues of design, funding, priorities, classification of the road and the potential involvement of local government in questions of funding, planning and construction all impact on the decision-making process and its timing.
[57] Mr Scott points to an observation by this Court in Attorney-General v Hull as supporting the proposition that the stepped approach is not appropriate in all cases: “Individual cases may present particular difficulties but the foregoing approach should be of assistance in resolving the usual cases which arise under s 40.”[23]
[58] There is no doubt that in determining s 40 cases the role of the facts is critical. The Supreme Court in McElroy v Auckland International Airport Ltd emphasised this stating that “questions regarding the use of land for public works are specific to the circumstances of the particular land and its history”.[24] Mr Scott cited two recent cases where the Court had not applied a bright line distinction or stepped approach between paragraphs (a) and (b) of s 40(1). First the Court of Appeal decision in McElroy v Auckland International Airport Ltd,[25] where this Court found that the land was still required for a public work without any discussion of whether the public work was under paragraph (a) or (b) and in so doing declined to analyse the scope of the public work for which the land was originally held. Writing for the Court, Robertson J stated:

[48] We accept AIAL’s submission that the inquiry as to why the land is now held is not limited to the specific words which were used in the documents that effected the initial acquisition. Rather, there must be an overall assessment of what was contemplated in terms of the land’s development and use, and what continues to be contemplated in those respects.

[49] ... All the contemporary evidence, and particularly the establishment deeds, reflect a commitment to a major national activity which inevitably would involve ongoing development and in respect of which flexibility and adaptability to advances in aviation technology and requirements had to be hallmarks.

[50] In light of this practical reality, it is unduly semantic to read down this complex inquiry by technical dissection of the word “aerodrome” which appeared in the first Gazette Notice.

[59] As a result of such analysis, this Court did not make an explicit finding as to whether the land was still required under paragraph (a) or (b). Instead it found that the land was now held for a public work different to the words of the Gazette notice. The Court stated: “We prefer a simpler declaration to the effect that the Craigie Trust land is ‘still required for a public work, namely the Auckland International Airport’”.[26]
[60] The second example was Ngahina Trust v Kapiti Coast District Council.[27] There, MacKenzie J referred to the stepped approach in Hull but stated:[28]

The relevant question here is whether the Council has at any stage made a decision, either expressly or by reasonable inference from its actions, that the land is no longer required for the public work for which it was acquired or for any other public work. ... I consider that it is appropriate to consider together the question whether the land is no longer required for the original work or any other work.

[61] The appellants submit that this Court should apply the stepped approach. Mr Smith seeks to create a bright line distinction between the government works envisaged by a motorway under the auspices of the NRB and local works for which the local authorities have some financial responsibility. Thus the appellants seek to rely on a gap between the triggering of s 40(1)(a) by the decision of the NRB and a failure to meet the test in s 40(1)(b) to demonstrate that the requirement to sell the acquired land to the appellants under s 40(2) has arisen. In this context the appellants rely on the fact that the mischief that s 40 seeks to address is to prevent land banking and to return acquired land to owners from whom it was acquired under threat of compulsion or their successors. This obligation would arise immediately the land is no longer required for the public work for which it was acquired.
[62] The respondents submit that in cases such as the present, involving significant complexities associated with funding and construction of a road of the scale of this project, it is unhelpful to seek to segment the Court’s inquiry under s 40(1). There is no need to separate questions about whether s 40(1)(a) is satisfied and if so, to then move on to determine whether s 40(1)(b) is satisfied. Mr Scott submits that the correct approach is to consider both questions together, with the Court ultimately asking whether the acquired land continues to be held for a public work or, to put the question in a negative way, whether a decision has been made or can properly be inferred that the acquired land is longer required for a public/essential work. The respondents submit that even if the stepped approach is followed, the outcome would be the same: that following the NRB meeting in December 1985 the land remained required by the NRB for a public work.
[63] We consider that, given the nature of the public work at issue, it is appropriate not to use the stepped approach. The better course is for the Court simply to ask the question whether there was a decision that the land was no longer required for a public work. In this respect we adopt the approach of this Court in McElroy v Auckland International Airport Ltd and the use of the merged approach followed in Ngahina Trust v Kapiti Coast District Council. We are satisfied that such an approach is consistent with the policy of the Act, being to facilitate the planning and construction of public works. Further, it meets the policy intent of s 40, which was identified by the Privy Council in Attorney-General v Horton. Section 40 thus embodies the expression of “a strong legislative policy to preserve the rights of an owner subject only to the continuing needs of the state”.[29]
[64] We consider that the merged approach is appropriate in light of the long term planning that is required for State Highways and motorways. It is to be recalled that most of the land was acquired in the 1950s and the road is still not built. Along the way, the government agencies concerned have confronted a wide range of design and construction, town planning/resource management and funding issues. These in turn often involve difficult political, as well as legal, questions and issues of potential conflict between local and central government institutions. As such bodies meet intermittently, the many complex issues required to be addressed take time to progress and resolve.
[65] Moreover, the facts of this case are not suited to a bright line distinction between government works and similar works by local authorities. In many cases involving claims under the Act the potential public/essential work arising for consideration under s 40(1)(b) is quite distinct or different in kind to the purpose for which the acquired land was originally acquired. An example would be as in Attorney-General v Morrison, where the land was initially held for housing purposes but later contemplated as a public reserve. We consider that the stepped approach is more apt for application where there is a clear bright line between the types of public work involved and the agencies responsible for the public work.
[66] Finally, we refer briefly to a principle discussed in counsels’ submissions concerning the prospect that the landholding agency was (in relation to the acquired land) in a state of genuine indecision. The possible existence of such a state of affairs was noted by this Court in Attorney-General v Hull.[30] It is in the evaluation of this issue that the facts, particularly the type of public work involved and its history, are likely to play a vital role. As noted by this Court in The Attorney-General v Edmonds, the nature of any proposals concerning the land held may “explain longer gestation periods”.[31]

Public work for which the land was acquired

[67] The preliminary issue is to determine the public work for which the land was acquired. This is a matter of reviewing all of the relevant facts and determining the purpose for which the land was acquired and held. The appellants contend that the acquired land was required for a “motorway”. Mr Smith submits that the word motorway is a term of art that has always had a specific statutory status that has not been altered over time. He refers to the current legislation governing “motorways” being the Government Roading Powers Act 1989.[32] Mr Smith further submits that the characterisation of the original purpose in acquiring the land is decisive, and once the acquired land is no longer required for that precise purpose s 40(1)(a) is met. Mr Smith submits that there is not just one essential public work at issue, rather that there were over the years distinct public works with different legal classifications under the applicable legislation.
[68] The respondents contend that the use of the narrow term “motorway” to define the purpose for which the land was acquired is a mischaracterisation. Mr Scott submits that land was held not for a strict “motorway” purpose, that is a road that would ultimately be legally classified as a motorway as a result of declaration after construction. Mr Scott submits that the genesis of this highway predated the motorway classification. Rather, the land was purchased and held to enable the construction of a major arterial route or highway, with controlled access that bypassed local townships. In other words, it could be either a motorway or a road functionally equivalent to that. Mr Scott also refers to the legislation dealing with public works of this type. Prior to the Main Highways Act 1922 there was no national body for roads and all roading was a local responsibility.[33]
[69] Under the Public Works Amendment Act 1947 (PWAA 1947) the concept of a “motor-way” involved the key characteristics of controlled access (access only from a motorway, main highway, road or street providing vehicular access, unless special access to adjoining property was authorised) and use confined to motor vehicles. The legislation provided for middle-line proclamations. In 1949 a Gazette notice authorised the construction of a motorway between Wellington and Foxton but to skirt Otaki, Levin and Paekakariki. But there was no middle-line proclamation until 1956. Prior to 1956, the only legal mechanism to limit access to a road was to declare it to be a “motor-way” under the PWAA 1947.[34]
[70] The acquired lands were the subject of various Gazette notices between 1955 and 1972. The Gazette notices refer to the purpose of this acquisition in various ways.[35] In the period 1972 to 1976, KBC developed a structure plan for the roading network in the Paraparaumu area. During committee meetings for the preparation of the plan, reference was made to the route involving the acquired lands being an “expressway” or “motorway”. This structure plan was considered by NRB in December 1976, the report referring to the roading pattern being based on a limited access road or expressway along the motorway line with other major arterials being the existing State Highway and Kapiti Road. In March 1977 the Minister issued a revised Ministerial Requirement for a “Proposed Road with Motorway and Railway”. This led to the incorporation into the district scheme of an “expressway”. Correspondence that followed soon after the Requirement emphasised that it was likely to be many years before any work was undertaken and, due to changing circumstances, these requirements would undoubtedly be reviewed over the years.
[71] We conclude that the public work contemplated in 1946 was a limited access State highway, the planning for which was under way before the concept of a “motorway” was introduced into legislation. It was the enactment of the PWAA 1947 that created the concept of “motor-way”, a key feature of which involved controlled access and use only by vehicles. The concept of separately defined limited access roads first emerged in 1956 but was further developed in 1963. Such roads involved similar restrictions so that they could function in a similar manner to motorways. Finally, the planning process carried out by the KBC and leading to the 1976 Ministerial Requirement saw a consensus emerge between NRB and relevant councils that the motorway route was to be used for a “limited access road or expressway”, the concept then being included in the District Scheme.
[72] Against this statutory and planning background, we are satisfied from the evidence that the acquired land was held for a public work involving a motorway or road that was functionally equivalent. More precisely, this involved a major highway that bypassed town centres for use only by vehicles and with controlled access points. Further, by 1976 the purpose for which the acquired land was held was for a “limited access road or expressway”. Such roading again involved a major highway that bypassed town centres for use by vehicles only and with controlled access points. Although the description had changed somewhat, the purpose for which the acquired land was held remained essentially the same. In this regard we are satisfied, as was this Court in McElroy,[36] that an ambulatory approach should be applied to the concept of limited access road. We accept the respondents’ submission that in both statutory and planning terms the word “motor-way” developed over time. But the broader underlying concept remained the same. It follows that we do not accept that a consideration of the purpose for which land is acquired should be limited by a narrow focus on the wording of the relevant proclamations. It is open to consider the substance of such purpose in more general terms. We see no reason to read down the concept of “public work” or interpret the term in a narrow or strict sense in the context of this case.
[73] Viewing the facts in that way means the so-called change in description from motor-way to expressway/limited access highway was not one that engaged s 40(1)(b) of the Act. Rather, it was a recognition that the public work for which the land was acquired and held was to be defined broadly having regard to the substance of the reason for its acquisition. Furthermore, the purpose itself might change in terms of detail over time. This is not a case, for example, where land was acquired for the purpose of a hospital and, when it was not required for a hospital, was retained for the purpose of another essential work such as a fire station. It is also material that the acquired land was but a small portion of a whole corridor of land over a very large area required for the purposes of a major highway, motorway or a road functionally equivalent to those. Thus, it is to be distinguished from a single site acquisition where the land is taken for a specific development such as a hospital.

Is the land no longer required for that public work?

[74] The next question in the application of the merged approach concerns an assessment of the intention of NRB in December 1985 with regard to the land held. As noted, such intention is to be considered in the light of objective circumstances.[37] This assessment requires consideration of the NRB resolution of 11 December 1985.[38] The wider context including related reports, correspondence and public statements at the time are also relevant.
[75] The appellants contend that NRB, at its meeting on 11 December 1985 and through its resolution in particular, made a decision that – as the responsible body for main highways, motorways and limited access roads – it no longer had any requirement for its purposes of the acquired land. The respondents made two responses. First, the resolution does not state what the appellants claim. Read in context, it is not possible to infer such a decision from the resolution. Second, in light of prior and subsequent events NRB needed the land for its future requirements and no final decision was made at the time.
[76] We start by observing that the resolution in question is very carefully worded. It did not say that the acquired land was no longer required for a public work. This was not a situation where NRB had decided definitively that the only major road in the area would be the State highway widened to four lanes and that there would never be a major road constructed on the Sandhills route. Rather, NRB was expressly leaving open the possibility of a road being built within the corridor, possibly by KBC and possibly with significant funding from NRB. It was even possible that, once such a road was completed, it might become part of the Wellington to Foxton motorway.
[77] This is apparent from the wording of part (a) of the resolution,[39] in which NRB resolved to advise KBC and the District Roads Council that it considered the existing State Highway 1 from Otaihanga Road to Poplar Avenue to be the appropriate one for eventual stage development as a four lane State highway. This part of the resolution is couched in very cautious, tentative language which we consider is not suggestive of any final decision having been made. The same is true of the wording of part (b) of the resolution. This captures the nature of the offer to the KBC as involving the option of having a long term highway bypass constructed within the existing motorway designation. The concept was that the initial stages of construction might be considered for funding as a subsidised work with a subsidy rate of up to 75 per cent. The final stage would involve a through connection able to be considered as a State highway work.
[78] Another important factor is that NRB did not resolve at that time to cancel or change the existing motorway designation. That is clear from part (c) of the resolution. We consider that any decision to have the Minister change the designation would have been premature as NRB did not know what response it would receive from KBC to its tentative offer. This is apparent from the NRB letter to KBC dated 16 December 1985,[40] in which consideration of the proposal by KBC is invited. Once KBC’s views were known NRB said it would “finalise its future strategies”.
[79] Contemporaneous documentation, including the letter of 16 December 1985, emphasised that many issues remained to be resolved. These included priority issues involving other major roading projects, implementation of a new funding policy for bypass projects, design and cost considerations, planning matters as well as political considerations for both local and central governments. Moreover, the newly available costings had shown that the options then under consideration had come closer together.[41]
[80] Statements in the media at that time by the NRB Chair, Hon F M Coleman, suggest that the option of four-laning State Highway 1 had major difficulties: “It would devastate the part of town [Paraparaumu] the highway now ran through. It would satisfy neither locals nor motorists.” The Chair also stated that “opting to four-lane the present route would sell short locals who had exercised foresight in setting aside land for the bypass”. As already noted,[42] other board members spoke of the long term planning involved suggesting that a new highway “could be 20 years away”. None of these comments support the proposition that a final decision had been made by NRB that the land was no longer required for a major arterial route. Not long before this, Mr Burt of MoW had drawn attention to potential political risks arising from widening the highway which would mean “blasting a way through the existing Paraparaumu township”.[43]
[81] For the appellants, Mr Smith relies on later correspondence from the Minister indicating that NRB was no longer prepared to support the motorway designation with its associated commitments.[44] Mr Smith also relies on another letter dated 24 December 1986 in which the Minister stated to a local resident that NRB “has given a clear indication that it no longer wishes to accept commitments associated with maintaining this designation in the [KBC] district scheme”. We consider that this correspondence needs to be seen in context. It does not state that a firm decision had been made in December 1985 that the land was no longer required for the public work for which it was held. In the letter of 24 December 1986 the Minister confirmed that NRB had acknowledged that it would not be prudent to have the designation removed and that some flexibility was required to ensure a reasonable solution. We consider that in order to determine the intention of NRB it is preferable to focus on the relevant parts of the resolution itself, the related correspondence and other evidence as at December 1985.
[82] The fact that KBC rejected the offer and sought to persuade NRB to build the road itself and pay for it in its entirety did not mean that KBC considered the acquired land was not needed for a road. We consider that the evidence supports the conclusion that both NRB and KBC (as well as other local authorities) determined that it was needed for a major road. In our view the conduct of KBC and NRB involved a degree of brinkmanship about the Western Link Road and who should be paying for it. At the same time, both parties seemed to accept that some type of major road needed to be built. Moreover, all those involved were concerned to ensure that the designation was retained while the parties responsible, particularly KBC and NRB, sought to work out between them what type of road was to be built, what its characteristics might be, when it was going to be built and how it might be constructed and paid for.
[83] The fact that there was such a long period of indecision between December 1985 and any decision making by the local councils is not determinative. This is again because of the nature of the project and the diverse factors and parties involved. This was the type of long term project where a degree of flexibility is required. A narrowly focused technical approach is not appropriate in that context.
[84] We are satisfied that the correspondence and related evidence supports the proposition that NRB wanted to hold the land as a backup in case its proposal to four-lane State Highway 1 failed. For example, it might not have obtained the required planning consents. We are unable to give weight to the evidence relied upon by the appellants, said to indicate a firm decision by NRB to release the acquired land to KBC. Such evidence as there is is not decisive because in our view the acquired land was always required for a major highway or motorway or road functionally equivalent to it.
[85] For completeness, we are satisfied that this was not a case of NRB (or any other entity) engaging in land banking, as suggested by the appellants. Rather, it was a matter of NRB, KBC and other relevant bodies taking a big picture view of roading requirements in the district, in the light of the long term goal to establish a Wellington-Foxton motorway. In making this assessment we observe that s 40(1)(a) of the Act is expressed in the passive voice. The question is not whether the NRB no longer requires the acquired land for a major road or whether the local councils no longer require the acquired land for a road. It is whether any land held under the Act “is no longer required for that public work”. We are satisfied that, despite the prolonged period of negotiation and brinkmanship (as described) between NRB and the local authorities,[45] throughout the entire period the acquired land was required for a major highway with limited access, bypassing local townships for use by vehicles or a road functionally equivalent to a motorway. Accordingly, we consider that s 40(1)(a) of the Act was not triggered. In this regard we take a different view to that expressed by Mallon J in her conclusions set out at [43]–[45] above.

Is the land not required for any essential work?

[86] Given our conclusions to the questions addressed above, applying the merged approach, there is no need for us to determine whether s 40(1)(b) of the Act is triggered. This question would have arisen if our conclusions on the first and second questions were different. It would focus on whether the acquired land was required for any other essential work after the NRB “decision” in December 1985.
[87] Had we been called upon to determine the application of s 40(1)(b) to the facts, we consider that the findings and reasoning of Mallon J on this issue are correct.[46] We agree that the acquired land was required for an essential work, namely, a major road that would bypass local townships. The fact that the precise nature of the road, its design, cost and timing was not known, is not determinative. In particular, as with the period of indecision post-December 1985 from the perspective of NRB, we do not consider any indecision on the part of KBC and other local authorities is decisive, for the same reasons discussed above.[47]

Discretionary relief

[88] We do not need to decide this question as on the above analysis it does not arise. In the High Court, Mallon J identified (although was not required to decide) any issues arising from s 40(2) of the Act.[48] If the conditions in s 40(1) had been met, and the offer back obligation under s 40(2) had been triggered, that obligation is subject to exceptions. Section 40(2) of the Act provided in 1985:

(2) Except as provided in subsection (4) of this section, the Commissioner of Works or local authority, unless—

(a) He or it considers that it would be impracticable, unreasonable, or unfair to do so; or

(b) There has been a significant change in the character of the land for the purposes of, or in connection with, the public work for which it was acquired or is held—

shall offer to sell the land by private contract to the person from whom it was acquired or to the successor of that person—

(c) At the current market value of the land as determined by a valuation carried out by a registered valuer; or

(d) If the Commissioner of Works or local authority considers it reasonable to do so, at any lesser price.

[89] Given that reliance was placed by the respondents on s 40(2)(a) on the basis that this is a case where the Chief Executive of Land Information New Zealand (LINZ) “considers that it would be impracticable, unreasonable, or unfair” to offer the land back, the question would be whether the Court could deal with this issue in the absence of any consideration and decision having been made by the Chief Executive. There would also be an issue as to whether any impracticability, unreasonableness or unfairness should be assessed at the time the offer back ought to have been made or whether subsequent events are relevant when declarations are sought that there has been a breach of the obligation and the offer back should now be made.
[90] We do not consider it necessary for us to decide either of these questions. The fact that they might have arisen (given different conclusions) points to real difficulties with the application of these provisions of the Act, particularly where many years have elapsed between the date of any decision that acquired land was no longer required and the time when the rights of previous owners or their successors (or a party such as Pritchard) were determined by the court. Potentially, some markedly odd results might follow, particularly where a claimant party is able to have the land offered back at the valuation applicable sometime in the past without any obligation to pay interest or rates in the meantime. While it is true that there is nothing to stop the original vendors of the acquired land or their successors from onselling the land, in this case it is not this group who stand to take the major benefit: the windfall gains would accrue to Pritchard.
[91] The second question is whether, had we concluded that the obligation to offer back under s 40(2) had been triggered and that a declaration to such effect might have been available, would discretionary relief have been granted? As noted by Zamir & Woolf, “the most important feature of the declaratory judgment is that it is a flexible and discretionary remedy”.[49] This in turn enables a court considering the exercise of such relief to have concise control over the circumstances and terms on which any relief might be granted and if it might be granted at all. In judicial review cases, it is axiomatic that the court has a wide discretion whether to grant a remedy at all and if so what form of remedy might be granted.[50]
[92] However, the question of discretionary relief does not arise in this case. We would only add that, had we been considering the making of a declaratory order, it would have been problematic in this case given the inordinate delay from December 1985 to the commencement of proceedings by the appellants in December 2001. Because the relief was formulated seeking declaratory orders, the appellants were able to avoid the application of the six year time bar in s 4 of the Limitation Act 1950.[51]
[93] As noted, the reality here is that the appellants (or more accurately Pritchard) would secure substantial windfall gains in circumstances where the applicants for relief had not sought to enforce an offer back until many years after the decision had been made by the land holding authority. This is because the offer back would be at market valuation of some many years before, without any commensurate adjustment for the time value of money or the fact that no rates have been paid in the meantime. Moreover all of the decisions over the years on roading funding and planning issues were made by the land holding agencies, the local authorities and others as part of an open, very public process.
[94] Even if a declaration were granted, there would still be an outstanding issue as to whether transferring back the acquired land would be unfair or unreasonable. It is not necessary for us to resolve whether that decision is one for the Court or for the Chief Executive of LINZ, but whoever the decision maker may be, the facts of this case provide a strong basis for arguing that a transfer would be unreasonable or unfair.

Result

[95] The appeal is dismissed. The appellants have not made out a case for declaratory relief for the reasons set out above.

Costs

[96] The respondents are entitled to costs for a complex appeal on a band A basis plus the usual disbursements. We certify for second counsel.


Solicitors:
Paul Cassin, Auckland for Appellants
Crown Law Office, Wellington for First and Second Respondents
Chapman Tripp, Wellington for Third and Fourth Respondents

[1] The parcels may be conveniently described as the Rankine land (CT 563/89); the Clunie land (CT543/182, 562/147, 526/220, 312/18, 209/278 and 536/78); the Shaw land (CT606/189); the Cudby land (CT465/218); and the Caldwell land (CT277/97) (together the acquired land).

[2] Mark v Attorney-General HC Wellington CIV-2002-485-799, 27 October 2009. The issues for determination in the High Court were wider, but narrowed significantly on appeal.
[3] At [286](b).
[4] At [229].

[5] Thus the first limb of the applicable statutory test in s 40(1)(a) of the Act is not met. Section 40(1)(a) is set out in [6] of the judgment.

[6] With the result that the appellants’ claim should be rejected, as found by Mallon J, on the basis that s 40(1)(b) of the Act had not been met. Section 40(1)(b) is also set out in [6] of the judgment.

[7] There was some discussion at the hearing as to the admissibility of such newspaper reports. We are satisfied that they may properly be taken into account, particularly as they were part of the agreed bundle both in the High Court and on appeal.
[8] At [164].
[9] At [286](a).

[10] As we will later describe at [69], the first time the concept of a motorway was used in legislation was in the Public Works Amendment Act 1947. A “motor-way” involved restricted vehicular access and was confined to motor vehicles. The first statutory reference to a “limited traffic road” was in the Public Works Amendment Act 1956 and it was not until the Public Works Amendment Act 1963 that limited access roads were statutorily defined.
[11] Gazetted pursuant to s 4 of the Public Works Amendment Act 1947.

[12] Under the Town and Country Planning Act 1953, a Minister or any local authority that had financial responsibility for a public work could require that provision be made in a territorial authority’s district scheme for that work.

[13] Letter from Kapiti Borough Engineer to District Commissioner of Works regarding the opinion of the Joint Working Committee (10 October 1974).

[14] Under s 21 of the Town and Country Planning Act, which enabled the Minister to require provision in the district scheme for that work.
[15] In a letter dated 24 December 1986.
[16] At [217].
[17] Attorney-General v Hull [2000] NZCA 107; [2000] 3 NZLR 63 at [41].
[18] At [226].
[19] At [228].
[20] At [229].

[21] Attorney-General v Horton [1999] UKPC 9; [1999] 2 NZLR 257 (PC).

[22] Attorney-General v Morrison [2002] NZCA 198; [2002] 3 NZLR 373 (CA).
[23] At [45].

[24] McElroy v Auckland International Airport Ltd [2010] NZSC 62, (2010) 19 PRNZ 785 at [3] (citing Hood v AttorneyGeneral [2007] NZSC 53, [2007] NZRMA 28 at [4]).

[25] McElroy v Auckland International Airport Ltd [2009] NZCA 62, (2010) 6 NZ ConvC 194,737.
[26] At [89].

[27] Ngahina Trust v Kapiti Coast District Council HC Wellington CIV-2008-485-1657, 31 May 2010.
[28] At [78].
[29] Attorney-General v Horton at 261.
[30] At [41], quoted at [54] above.
[31] The Attorney-General v Edmonds CA97/05, 28 June 2006 at [75].
[32] Formerly the Transit New Zealand Act 1989.

[33] After 1922 both central and local government funded “main highways”. The Main Highways Act was amended in 1936 to enable classification of main highways as “State highways” and provide for the setting of standards. By 1946 the Government was beginning to turn its mind to building State highways including one between Wellington and Foxton. The principle of limited access from other roads only was being developed but there was no legal mechanism to restrict access.

[34] Later, under the Public Works Amendment Act 1956, there was power under s 9 to make a declaration of a “limited traffic road or street”. This proved to be unworkable and was replaced by s 4 of the Public Works Amendment Act 1963 enabling the declaration of limited access roads.

[35] Gazette notices refer variously to “for better utilisation” (Caldwell), “for the use, convenience, or enjoyment of the Wellington-Foxton Motorway” (Cudby, Shaw and Rankine) and “taken, subject to Proclamation ..., defining the middle line of a portion of the Wellington-Foxton Motorway, for better utilisation” (Clune).
[36] At [59].
[37] Attorney-General v Hull at [41].
[38] Set out at [26] above.
[39] Set out at [26] above.
[40] Quoted at [28] above.
[41] According to the September 1985 submission to NRB.
[42] Set out at [27] above.
[43] In a media statement on 17 July 1985, as set out at [23] above.
[44] Set out at [37] above.
[45] As illustrated in the correspondence summarised at [28]–[41] above.
[46] As set out at [46] above.
[47] Set out at [82]–[84] above.
[48] At [246]–[247].

[49] Lord Woolf, Jeremy Woolf and Lord Clyde Zamir & Woolf: The Declaratory Judgment (3rd ed, Sweet & Maxwell, London, 2002) at 123.

[50] Halsbury’s Laws of England (5th ed, 2010) vol 61 Judicial Review at [692].
[51] As discussed by Mallon J at [197]–[202].

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