Anderson v Auckland Council [2014] NZHC 1480 (27 June 2014)

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UNDER	the Judicature Amendment Act 1972
IN THE MATTER	of a decision made pursuant to s 95B of the Resource Management Act 1991
BETWEEN	IAN AND NORMA ANDERSON First Plaintiffs PENE PATI and NORMA ANDERSON Second Plaintiffs
AND	AUCKLAND COUNCIL First Defendant BODY CORPORATE 145836 Second Defendant GHUZNEE HOLDINGS LIMITED Third Defendant

Hearing:	17 June 2014
Counsel:	A McDonald and R Ashton for Plaintiffs. Assisted by DR Bigio for part of hearing. D Neutze and S Schlaepfer for First Defendant HP Holland for Second and Third Defendants
_Judgment:	_{27 June 2014}

This judgment was delivered by me on Friday, 27 June 2014 at 5 pm pursuant to r 11.5 of the High Court Rules.

[1] The first plaintiffs, Ian and Norma Anderson, and the second plaintiffs, Pene Pati and Norma Anderson as trustees of the Tasi Uno Trust, have been engaged in litigation against Ghuznee Holdings Ltd (Ghuznee), the third defendant, which owns a complex of buildings previously known as Culverden Retirement Village (the complex). The Andersons have occupied and wish to occupy two units in that building. Ghuznee does not believe the Andersons occupy the units, or have any right to occupy them.

[2] In this particular proceeding the Andersons seek a declaration of the first defendant, the Auckland Council, “that a resource consent converting a previously consented retirement village into residential dwellings with the addition of two residential units within an existing building be approved” is invalid and of no effect. They also seek orders quashing or setting aside a decision not to extend the time for filing submissions, and an order quashing or setting aside a decision made by the Council as to how it would notify the resource consent application.

[3] The basic facts that have led to the present impasse between the parties are not complex. The Andersons claim that from 1992 until 12 November 2013 they have lived at Unit Q, an upstairs unit above the community area of the complex. This was previously the manager’s unit in the complex. They also assert that they were the original trustees of the Tasi Uno Trust and that Unit C in the complex is the property of that trust. They subsequently resigned as trustees of that trust, although Norma Anderson has become a trustee again, replacing a Mr Ricardo Marques.

[4] Although the statement of claim refers to Unit C owned by the second plaintiffs, in the course of submissions Ms McDonald who appeared for the plaintiffs accepted that no relief was sought in relation to Unit C, and that the plaintiffs’ complaints were focussed on events relating to Unit Q. I will therefore make only limited further reference to Unit C.

[5] The complex was originally known as Culverden Retirement Village and owned by Culverden Retirement Village Ltd. It was submitted by the defendants and not refuted by the plaintiffs that the Andersons had an ownership interest in Culverden Retirement Village Ltd. While the fact that they had an interest in the complex was not denied in the hearing, the details of their interest did not become clear in the course of this hearing.

[6] Mr and Mrs Anderson have produced a document referred to as a Deed of Life Interest which relates to Unit Q. The deed was not registered against the certificate of title and there was no caveat lodged indicating an interest. It is dated

30 October 2002 and is between Culverden Retirement Village Ltd and the Andersons in various capacities. The signatures for Culverden Retirement Village Ltd are signed by Mr I E M Anderson as a director. The signatures on behalf of Culverden Care Lifestyle Village Ltd and Primero Trust which appear to be associated with the ownership of the village are also signed by Mr I E M Anderson, and in respect of the Primero Trust by Norma Rosalie Anderson. Thus the document features only signatures by the Andersons.

[7] In 2002 there was a first registered mortgage over Unit Q, and presumably other units, to Halliwells Securities Ltd as mortgagee. This mortgage was described as being transferred to FM Custodians Ltd on 5 January 2005. However, it seems that the mortgage was in fact discharged and a new first mortgage granted to FM Custodians Ltd on that date.

[8] On 1 April 2011 Culverden Retirement Village Ltd defaulted under the mortgage. On 21 June 2012 the units in the complex, including Unit Q, were sold by FM Custodians Ltd at a mortgagee sale to the third defendant Ghuznee.

[9] After the mortgagee sale Mr and Mrs Anderson refused to vacate Unit Q on the basis that they had a Deed of Life interest. Ghuznee obtained an order from the Tenancy Tribunal concluding that it had jurisdiction over the tenancy of Unit Q as a residential tenancy and granting Ghuznee possession of that unit.

[10] The Andersons appealed the decision in the District Court where it was upheld. In the District Court decision it was stated that there had been no knowledge or consent to the Deed of Life Interest by FM Custodians Ltd and that Ghuznee obtained good title from FM Custodians Ltd pursuant to s 105 of the Land Transfer Act 1952. A similar conclusion had been reached in the Tenancy Tribunal.

[11] That decision went on appeal to the High Court. The appeal was successful.¹

The Judge held that the appellants inability to show that they held an instrument having priority over the mortgage or by a consent of the mortgagee meant that under s 105 any rights of occupation that they may have had were extinguished.²However, the Judge held that the premises were not residential premises and that the findings of the Tenancy Tribunal and the District Court were in error. Leave has since been granted for this decision to be appealed to the Court of Appeal.

[12] In 2013 Mr and Mrs Anderson commenced proceedings separate to those in the Tenancy Tribunal in the Environment Court against Ghuznee and Auckland Council seeking declarations under s 311 of the Resource Management Act 1991 (the RMA) relating to the alleged unlawful use of the complex for residential units. Those proceedings continue.

[13] The resource consent for the original complex provided for the use of the property as housing for the elderly together with a communal recreation building and a manager’s residence. The manager’s residence unit is what is known as Unit Q. That resource consent was a departure from the terms of the district plan. Amongst other things the resource consent required that none of the units in the village be occupied by persons under the age of 55 years.

[14] On 10 October 2013 Ghuznee applied for the resource consent changing the permitted use of the premises to residential.

[15] On 25 November 2013 the Council by an officer Sarah Dreadon summarised the proposal. She noted that recent internal photographs supplied by Ghuznee

indicated that Unit Q was now vacant. Confirmation had been provided in writing by Ghuznee to the Council of a communication from Mercury Energy that the power account to Unit Q had been closed since April 2013 and that the power had been cut off. She observed that it was not possible at that time to ascertain whether the Andersons were still occupiers. She concluded that there should be a limited notification of the application as the possible effects were in her opinion an internal matter, and she noted that the two unit owners who had not approved, including the occupier of Unit Q, were in her opinion adversely effected by the proposal. She recommended that the occupiers of Units C and Q be notified.

[16] Ms McDonald for the Andersons submitted that the actions of the Council in purporting to serve the notice were neither fair nor reasonable nor proper. The Andersons were deemed to be occupiers of Unit Q and had a right to be notified. Ms McDonald does not argue that there was any obligation to serve the Andersons personally. She accepts that the obligation was to serve the “occupier”

25 November 2013 the Andersons were not the occupiers of Unit Q and had no right to be served and therefore no basis for complaint if they were not served.

25 November 2013 notification recommendation to notify the “occupier” of Unit Q.

12 November 2013. Ms McDonald argued that a temporary absence does not bring habitation to an end, and that an occupier does not lose that status where the occupier is barred from physical occupation.

[19] It is not possible to resolve the factual dispute as to whether the Andersons occupied Unit Q up to 12 November 2013 on the material before me. However, Mr and Mrs Anderson themselves have deposed that they were evicted from Unit Q by Ghuznee on 12 November 2013. They accept that the locks were changed on that

date and they have not been back. Since 12 November 2013 they have not lived in or inhabited Unit Q, and not taken any of the steps reasonable associated with ownership or occupation. The only step that they have taken is to contest the Tenancy Tribunal ruling that Ghuznee is entitled to possession of the premises and pursue the Environment Court proceedings.

[22] In the RMA definition of “occupier” there is an unusual juxtaposition of two nouns “inhabitant” and “occupier”, presumably inserted by the legislature to communicate a particular meaning. Counsel have been unable to refer me to any aid to interpretation or authority on the meaning of the words “inhabitant occupier”, save for a helpful analysis in the Environment Court decision of Manukau City Council v Murray.⁴The Environment Court focussed on the issue of control and found that the first respondent Mr Murray had lived on the site from time to time, kept it clean and carried out various acts indicating control. It concluded that Mr Murray “...

exercises sufficient control over the site and carries out activities on the site

[23] While the words “inhabit” and “occupy” are treated as synonyms,⁶they impart the concept of actual habitation. The combination and juxtaposition of the two words in my view indicates that a inhabitant occupier of a property is a person who while not necessarily living there all the time, can be seen as the person

_{exercising actual dominion and control over the property at the relevant
time.}

⁶See the Tony Deverson and Graeme Kennedy (eds) New Zealand Oxford Dictionary (Oxford

[24] The Andersons were not exercising any form of dominion or control over Unit Q at the time of the direction to serve the occupier on 23 November 2013, or at the time of service in December 2013. They had no right to be served.

[25] The Council did not propose in its service direction that the Andersons should be personally served. Given that the Andersons had no right to be served because they were not the occupiers, they cannot pursue complaints about non-service in this proceeding. It was not a failure that can give rise to a claim for judicial review at their behest. By their own account, they had been evicted. They did not have any actual control or dominion over the site. At best they can pursue a civil claim (which for reasons I set out next would not in my view succeed) claiming a legal right to a life interest. But they do not inhabit or occupy the premises. Therefore, they have no status in this judicial review proceeding to contest the sufficiency notice that was ultimately sent to the occupier of Unit Q on 18 December 2013.

[26] I also do not accept that there was any basis for the Andersons to claim any right to occupy Unit Q. The document that they have produced to support their claim to a life interest is a 2002 document. The only signatories are the Andersons. There is no obvious consideration. No rent is to be paid. Both the Tenancy Tribunal and the District Court have relied on s 105 of the Land Transfer Act 1952 which provides that upon the registration of any transfer executed by a mortgagee for the purpose of exercising a power of sale, the interest of the mortgagor passes free and discharged from any estate or interest, save for an estate or interest created by an instrument which has priority over the mortgage which by reason of the consent of the mortgagee is binding on him. There is no written evidence of such consent by the mortgagee. The oral assertions of the Andersons that such a consent was given are uncorroborated and unconvincing.

[27] The proposition relied on by the Andersons, that they are entitled to live in Unit Q without paying any rent for the rest of their lives, is startling, and in my view is not proven on the balance of probabilities. Indeed, it is not a believable claim. It is significant that the Tenancy Tribunal, the District Court and the High Court were all of the view that s 105 applied. Ms McDonald (and Mr Bigio who made a submission on this point), are correct when they point out that the issue has never

been argued in a way which would give rise to res judicata. However, the Andersons have never brought any substantive claim seeking a declaration or other relief on the basis that they have a life tenancy. They have not shown on the balance of probabilities any life interest in Unit Q.

[28] This does not of course prevent the Andersons from claiming a remedy for their resulting loss against Ghuznee, if they had been wrongly dispossessed of their premises. However, such private claims cannot affect the Council’s obligations.

[30] It is the further submission of the Andersons that the service of the “occupier” was defective. Although my earlier finding that they had no status as an occupier makes determination of this issue strictly unnecessary, I will nevertheless consider it.

[31] The initial notice to the occupier of Unit Q, sent on 4 December 2013, was addressed to:

2013. The Council accepts no service on the occupier was affected on this occasion.

[34] Ms McDonald submitted that this was not service on the occupier as there was no letterbox for Unit Q, and that Unit Q was generally referred to as 40 Linnet

[35] However, Unit Q is not shown as 40 Linnet Place on any of the Council records. No number is given to Unit Q on its plans. In the Council’s rating information database 40 Linnet Place is the address listed for the community area, that is Unit P and not Unit Q. Unit P and Unit Q have different certificates of title. They are two separate units and a reasonable person would assume that the addresses were not be interchangeable.

[36] I am satisfied on the affidavit evidence that Unit Q, being the manager’s unit and above the community area, is the only residential unit situated totally on a floor above ground level. It seems to me that the address that was put on the notice was the best solution in the circumstances. It was not inaccurate for the Council to refer generally to 1-41 Linnet Place (being presumably all the units) in its notice. In stating “Unit Q – upstairs” it was giving any Post Office worker a very clear indication as to where Unit Q was. There was no other wholly upstairs unit. It can be assumed that the postie who delivered mail to these units would have been familiar with their layout. The notice was not returned to sender as the earlier notice had been.

[37] On the basis of the Council records it would have been wrong for the Council to have sent the notice to 40 Linnet Place as is suggested by the Andersons. While there were references to Unit Q being 40 Linnet Place in the Tenancy Tribunal, the Council was not involved in those proceedings. The Council had no reason to suspect that the address it placed on the notice was wrong. In my view it met its duty to place an adequate address on the notice by addressing it the way it did on the second occasion.

[38] I note that s 352(1) of the RMA provides that a notice is served on the person by sending it “by pre-paid post address to the person at the usual or last known place of residence or business of the person”.⁷It is also stated at s 352(5) that where a

_{notice is sent by post to a person in accordance with s 352(1)(c) it
should be deemed}

in the absence of proof to the contrary to be received by the person at the time at which the letter would have been delivered in the ordinary course of the post. It is significant that the Andersons have not deposed that they never received the notice.

[40] There are in the statement of claim and the written material provided to the Court claims that there had been wrong advice by the Council about the time the Andersons had in which to file submissions. In relation to an extension decision of the Commissioner refusing to extend the time for filing submissions, it is contended that this was in error. However, in the course of the hearing Ms McDonald accepted that there was no issue raised about the Council or the Commissioner’s actions in relation to Unit C.

[41] This concession (which was in my view correctly made) is fatal to the complaints about the advice to the Andersons’ lawyers and the extension decision. This is because there never was, and has not been down to the present time, any attempt by the Andersons to make a submission to the Council in relation to the resource consent concerning Unit Q. There was advice given to Pidgeon Law about the limited time for filing a submission, but the result was that a submission was filed relating to Unit C by Mr Pati and Ms Anderson in their capacity as trustees. There was no submission filed and therefore no extension sought in relation to Unit Q. Accordingly when the Commissioner issued a decision refusing to extend time that only related to Unit C and not to Unit Q. That decision is not relevant to the claims concerning Unit Q. There was no extension of time in relation to Unit Q, but an extension was not sought. So there can be no challenge to the alleged refusal to extend.

[42] The pleadings show some limited challenge to the Commissioner’s decision, although the basis for it is not clear. There was no challenge to that final decision allowing the resource consent application in the submissions presented to me. There

is no apparent error in that decision. The matter raised by the Andersons about service would have made no difference to that decision. There is no basis for review.

[43] In judicial review proceedings the Court has a general discretion as to whether to grant relief.⁸It will not grant relief if it is futile to do so.⁹

[44] Even if an error by the Council had been made out, there would be good reason for the Court not to intervene. There is every indication that if there was a further hearing by the Commissioner the result would be the same. The issue before the Council was whether the area occupied by the apartments should be permitted to convert the retirement village into residential dwellings with the addition of two residential units.

[45] The Commissioner’s decision reflected the reality of the past residential use of the complex. There was no suggestion that the Commissioner was wrong in concluding that there were no more than minor effects on the environment if the use was changed to residential. In particular, the existing buildings were sympathetic to the surrounding character of the neighbourhood and the use of them for a residential rather than retirement activity would not cause any adverse effects on the onsite amenity. The proposal would not change matters for adjoining properties. There were no submissions from persons deemed to be adversely effected by the proposal.

[46] There was no suggestion in any of the material filed there was any defect in the Commissioner’s reasoning. The Commissioner stated that he had read the submissions ultimately filed by Pene Pati and Norma Anderson as second plaintiffs, and that they did not make any difference to his conclusions. It seems certain that the Commissioner would reach the same decision as before if there was a further hearing.

⁸AJ Burr & Co Ltd v Blenheim Borough Council [1980] 2 NZLR 1 (CA) at 4; Siemer v Solicitor- General [2013] NZSC 68, [2013] 3 NZLR 441 at [72] per Elias CJ; Lewis v Wilson & Horton Ltd [2000] 3 NZLR 546 (CA) at [96].

[49] I hope that costs can be agreed. If not, the defendants may file submissions within 14 days and the plaintiffs in reply within a further seven days. Submissions should not exceed three pages in length.

High Court of New Zealand Decisions

Anderson v Auckland Council [2014] NZHC 1480 (27 June 2014)