Everton Heights Limited v Hamilton City Council [2023] NZHC 40 (31 January 2023)

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IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2020-419-251
[2023] NZHC 40

UNDER	the Judicial Review Procedure Act 2016
IN THE MATTER	of an application for judicial review
BETWEEN	EVERTON HEIGHTS LIMITED Applicant
AND	HAMILTON CITY COUNCIL Respondent

Hearing:	26 October 2021 (Undertaken via VMR during COVID-19 Alert Level 3)
Appearances:	J F Anderson KC and D T D Horton for the applicant L F Muldowney and S K Thomas for the respondent
Judgment:	31 January 2023

This judgment was delivered by me on 31 January 2023, at 1:00 pm Pursuant to Rule 11.5 High Court Rules

EVERTON HEIGHTS LIMITED v HAMILTON CITY COUNCIL [2023] NZHC 40 [31 January 2023]

[1] It almost goes without saying that for land to be developed, services and infrastructure are needed. Equally clear is the fact that these things are expensive, so the question invariably becomes how much should be paid for them and by whom. This case is about development contributions; a tool used by councils and authorised under the Local Government Act 2002 (the LGA) to require developers to pay a sum towards the cost of services and infrastructure. This is a judicial review case, in which a developer claims the Hamilton City Council (the Council) has unlawfully required it to pay development contributions contrary to the policy it says applies and upon which it relied when it priced and commenced its development.

[2] Everton Heights Limited (Everton)’s claim against the Council is that it was notified by the Council that the development contributions it would be required to pay for the second part of its development (Stage 3-5) would be assessed under the Council’s 2016/2017 development contributions policy (DC Policy). Subsequently, however, the Council changed its mind and required the development contributions to be assessed under the 2018/2019 DC Policy at almost double the cost to Everton. The Council maintains it was able to do this as a matter of law, however Everton disagrees. In legal parlance, the causes of action Everton pleads are material error of law and breach of legitimate expectation. Everton seeks a declaration and an order that the Council apply the 2016/2017 DC Policy to the second part of its development when calculating the required development contributions.

[3] Everton had also pleaded a cause of action claiming that the Council had taken into account irrelevant considerations when it determined that it could apply the 2018/2019 DC Policy to Everton’s development, but this cause of action was not pursued at the hearing. I have retained the reference to the causes of action as they appear in the pleadings, first and third respectively, to avoid confusion.

[5] I have decided to grant the application in respect of the first cause of action but decline it in respect of the third cause of action. This decision sets out my reasons for doing so.

[6] I start this judgment with some introductory remarks about development contributions, including the statutory framework that authorises them under the LGA, before providing some further context to the development contributions regime in Hamilton. I then outline some necessary details about Everton’s development before providing an overview of Everton’s claim. The analysis of the two grounds of review follows on from these introductory but important matters.

[7] Development contributions are a one-off charge to provide new or expanded infrastructure. They enable territorial authorities to recover a portion of growth infrastructure from developers. Development contributions are therefore an important funding tool for a territorial authority, of which the Council is one. Mr Briggs, the former Chief Executive Officer of the Council, acknowledged that it relies on development contributions as a primary funding tool for the provision of public infrastructure.

[8] Development contributions are also a significant, if not the largest cost associated with a development. For this reason, developers are very keen to know what the likely cost to them will be, so they can factor this cost into their development budgets.

[9] For both the Council and the developer, the sooner development contributions as either future revenue or expenditure can be quantified, the better. It is understood by all, and provided for by the LGA, the finalised amount of any monetised development contribution is not until later in the development.

[10] Given that Hamilton has been identified by central government as a “growth Council”, it is required under the National Policy Statement on Urban Development Capacity to provide for 31,900 more homes by 2048, including 12,500 within the next ten years. One of Hamilton’s most significant growth areas is Rotokauri, a largely greenfield growth area to the north-west of Hamilton City. The Everton land and development is within this area.

[11] The LGA sets out the provisions that apply to development contributions. Among other things, these include their purpose, the power of a council to require them, the basis upon which they may be required, and the principles that apply to any policies promulgated under the LGA.

[12] The provisions about development contributions are largely found under pt 8 of the LGA entitled “Regulatory, enforcement, and coercive powers of local authorities”. However, the requirement to adopt a development contributions policy and what it must contain is outlined in pt 6, sub-pt 3 of the LGA entitled “Financial Management”.

[13] Sections 197AA – 211 of the LGA are contained in sub-pt 5 entitled “Development contributions”. The first three sections (ss 197AA, 197AB and 197) deal with the purpose of development contributions, the principles in relation to them and interpret various terms used in the following sections. The remaining sections are included under the headings “Contributions may be required by territorial authorities” (ss 198 – 199P), “Conditions relevant to requirement for contributions” (s 200), “Development contributions policy” (ss 201 – 203), “Use of development contributions” (ss 204 – 207), “Development agreements” (ss 207A – F), “Powers to recover unpaid development contributions” (s 208) and “Refund of development contributions” if, for example, a development does not proceed (ss 209 – 211).

The purpose of the development contributions provisions in this Act is to enable territorial authorities to recover from those persons undertaking development a fair, equitable, and proportionate portion of the total cost of capital expenditure necessary to service growth over the long term.

[15] Section 197 includes the interpretation of various terms used in sub-pt 5. The following terms are relevant in this case:

capital expenditure includes any funding provided by a responsible levy authority to contribute to the construction costs of eligible infrastructure that has been, or is intended to be, transferred to the authority under section 90 of the Infrastructure Funding and Financing Act 2020

development contribution policy means the policy on development contributions adopted under section 102(1)

network infrastructure means the provision of roads and other transport, water, wastewater, and stormwater collection and management.

[16] Section 199 sets out the circumstances which may give rise to a territorial authority requiring a development contribution from a developer. It provides:

[17] Section 198(1) sets out when a development contribution may be required to be made. Subsections (1), (2) and (2A) are relevant to this application. They provide:

(2A) For the purposes of subsection (2), a development contribution must be consistent with the content of the policy adopted under section 102(1) that was in force at the time that the application for a resource consent, building consent, or service connection was submitted, accompanied by all required information.

[18] The effect of s 198 is that although a development contribution may be required when a resource consent, building consent or service connection is granted, it must be consistent with the policy in force at the time the application was submitted, accompanied by all required information.

[19] Section 197AB sets out the principles that must be taken into account when preparing a development contributions policy under s 106 or requiring development contributions under s 198. Section 197AB(f) states:

(1) All persons exercising duties and functions under this subpart must take into account the following principles when preparing a development contributions policy under section 106 or requiring development contributions under section198:

[21] The themes of predictability and certainty are important to developers as well as to territorial authorities.

[22] Sections 106, 201 and 202 of the LGA establish what a development contributions policy must contain, which includes a development contributions schedule. Section 106 provides that a development contributions policy must be reviewed at least once every three years, and the review process requires public consultation.¹Section 202 includes the following:

[23] The DC Policy is the document members of the public access and rely upon to understand what the Council’s development contributions requirements are.²

[24] The setting of development contributions fees is relatively complex, but it is not necessary to address it for the purposes of this judgment.

[25] Because of the above, depending on the existing or planned infrastructure in a particular area, development contributions may differ vastly across a territory and charges may also differ depending on a Council’s priorities and preferences. It may, for example, reflect choices as to timing, such as when a council or territorial authority will require development contributions to be made.

[26] The Department of Internal Affairs publishes specific recommendations that it suggests territorial authorities adopt in the policies they promulgate. One such recommendation is that development contributions be required at the earliest milestone in a development. This is primarily because payment will occur earlier in time, which can mean that the development contributions a developer pays are a prepayment for demand on infrastructure and services that arise later once the development has been completed. In almost all cases, the earliest milestone in a development will be at the time resource consent is granted.

[27] As outlined, the key issue here is whether the Council is obliged to assess the development contributions for Everton’s development under the 2016/2017 DC Policy or the 2018/2019 DC Policy.

[28] The 2016/2017 DC Policy is 56 pages long, comprising several parts. Part 11 of the policy is titled “Stages at which development contributions are triggered (s198, 202(1)(b) LGA)”, but the Quick Reference Guide reads “Stages when development contributions are required”.

[30] As can be seen, cl 11.3 echoes s 198 of the LGA. It states that the Council can require a development contribution to be made when either a resource consent, building consent, or authorisation for a service connection is granted. Clause 11.8 of the 2016/2017 DC Policy adds to s 198(2A) by specifying that the calculation of the

[31] Mr Olliver, a planning consultant of considerable experience and expertise, provided evidence for Everton based on his experience working in the planning and resource management sector for 40 years, mostly in the Waikato region. Because of his expertise and the references in his evidence to the Resource Management Act 1991 (RMA), I infer that his evidence about the Council’s development contributions regime relates to applications for resource consent as opposed to any other kind of application.

[32] Mr Olliver described the Council’s standard process in relation to development contributions as comprising three phases:

[33] Mr Olliver explained that prospective applicants can anticipate the development contributions payable for their development in advance of making an application by either using the development contributions “estimator tool” on the Council’s website, or by obtaining an assessment of the development contributions likely to be required through the pre-application process. He explained that the latter would involve a pre-application meeting with the PGU, at which time development contributions are always discussed. Mr Olliver said that applicants could elect to have one of the Council’s dedicated development contributions officers in attendance to discuss the development contributions that would to be levied on an application once it had been lodged and accepted.

[34] Once the pre-application phase is completed, Mr Olliver said, an applicant’s resource consent application would then be lodged and, if accepted, development

[35] Mr Olliver said the fees levied would be assessed by Council staff applying the operative DC policy to the development. He explained:

[36] If an application for resource consent was the first step involved in a development, Mr Olliver said the Council would always levy development contributions then. However, in cases where there was no need for a resource consent, Mr Olliver said that development contributions would be levied at the building consent or service connection stage of a development. In his experience, levying development contributions at the building consent stage of the development was less common than at the resource consent stage, and even less common at the service connection stage.

[37] Prior to 2018, once an application had been lodged and accepted, Mr Olliver said the Council would send the applicant a letter setting out the Council’s assessment of the development contributions it proposed to levy. This was referred to as the Council’s “DC fees advice letter”. Although the assessment provided in the letter could change, Mr Olliver’s experience was that this would only happen if the demand created by the development changed. This could occur with respect to a resource consent application if the number of lots increased, or in relation to a building consent application if the building increased in size. In both these scenarios, the demand on infrastructure may have changed, and therefore a reassessment of the development contributions payable could be warranted. Mr Olliver was clear, however, in his experience, this only occurred when a change had been made by an applicant, never by the Council.

[38] Mr Olliver also explained that the development contributions included in a development budget are treated by developers as fixed costs. But, if there is a change in the demand created by the development, he said that the developer would be advised of the Council’s updated development contributions assessment, but payment of the additional amount would be levied at the same point in time when the payment was originally due to be made for that development, unless the change in demand arose at a later stage in the development, in which case Mr Olliver said the additional fee would be levied at the later stage. For example, if resource consent had been granted for a retail activity, but at the building consent stage the floor area for the development had increased, the additional development contributions would be levied on the building consent.

[40] Everton is a privately held development company which has undertaken several residential land development projects within Hamilton City over the past decade. It owns a property comprising about 12 hectares at 208 Rotokauri Road, Hamilton, which it plans to develop. Under the RMA, both subdivision and land use consents are required to develop the land.

[41] Everton instructed CKL, a resource management consultancy to prepare a plan for the development of the land. A five-stage development was proposed.

[42] It would have been preferable for Everton’s entire development to have been undertaken at the same time, however the catchment for the Rotokauri area of Hamilton has a very complex water table with known stormwater issues. The planning regime therefore required an Integrated Catchment Management Plan (ICMP) to be prepared for the whole catchment. The development of all land in the Rotokauri area was dependent on the ICMP being developed.

[43] It was decided that the ICMP would best be done by the Council, no doubt to ensure that stormwater issues were addressed holistically rather than in a piecemeal fashion, development by development.

[44] The process to prepare the ICMP began in 2011. The ICMP was eventually finalised by the Council in June 2017 following extensive consultation with interested parties, including Everton and other developers.

[45] The cost of the stormwater solution contained in the ICMP (a 3.5 km greenway) is relevant to the development contributions issue before the Court. It, the Greenway, is an expensive piece of infrastructure designed to provide a stormwater solution for Rotokauri as well as ecological and recreational benefits.

[46] It is worth noting that the Council’s Long-Term Plan (LTP) for 2012 – 2022 only included a small amount of funding for stormwater in Rotokauri. However, it did include some funding for the designation of the Greenway. In 2019, the Council obtained designations under the RMA which secured the necessary land use planning approval for the designated route of the Greenway.

[47] Mr Carstens, the Council’s Growth Funding and Analytics Manager, set out in his affidavit how the Council recognised the expected capital expenditure associated with the Greenway construction. He explained that this first occurred via the capital expenditure budget set out in the 2015 – 2025 LTP. In this LTP, a total amount of

[48] Mr Carstens said that the amount of capital expenditure appearing in the budget was far from the full estimated cost of the Greenway for reasons not material to this proceeding.

[49] Mr Carstens explained, that as with all projects, the Greenway and its related capital expenditure was analysed in accordance with a cost allocation methodology. However, because growth was a significant cause of the capital expenditure associated with the Greenway, and as “the growth community stood to be a major beneficiary of

[50] Mr Carstens deposed that the allocation of part of the total funding of the Greenway was reflected in both the 2015/16 DC Policy and the 2016/17 DC Policy, which he said included within each schedule of assets, significant capital expenditure relating to the Greenway. The figure was referred to in both as “local trunk stormwater infrastructure” amounting to $28.051 million, and it was noted that $24.755 million would be recovered through development contributions. Stormwater projects associated with the ICMP and other stormwater infrastructure were listed as amounting to $637,000.

[51] Mr Carstens concluded this discussion in his affidavit with the following comment:

This high allocation of total costs to the growth community (88%) reflects that the Greenway will be almost exclusively for the benefit of private development in Rotokauri Stage 1, the area where the Everton development is located. The need for the Greenway solution is caused by the current and future planned development in the catchment. If there was no development planned in the area, there would be no need for the Greenway.

[52] In November 2016, Everton lodged an application for a 39-lot subdivision (Stages 1 and 2) with the Council. Subdivision consent was granted in April 2018. A subdivision consent is a resource consent under s 87 of the RMA.

[53] The Council required development contributions to be paid upon the grant of the subdivision consent, which was the option the Council had always adopted under s 198(1) of the LGA. Everton’s development contributions in respect of Stages 1 and 2 were calculated under the 2016/17 DC Policy, and Everton paid them.

[54] The development community (including Everton) was aware that the Council would be preparing to update its LTP in 2018 in accordance with the three-yearly requirement to do so as outlined in the LGA. It was common ground that this would mean an updated ten-year budget and, significantly for developers, an updated DC Policy which would mean higher development contributions charges. It was understood that the development contributions charges would be introduced in mid- 2018.

[55] The proposed 2018/2019 DC Policy was published for consultation. Under the proposed policy, development contributions charges increased significantly across Hamilton. In Rotokauri, they were proposed to increase from $33,827 to $69,516 per household unit equivalent (HUE).

[56] Following the grant of its Stages 1 and 2 consent in April 2018, Everton briefly considered selling its development. This was advanced to the extent of advertising the development and calling for tenders. The tenders received indicated that prospective buyers were concerned about the proposed increase in the Council’s development contributions charges which had just been published as part of the proposed 2018/2019 DC Policy. Prospective buyers required any sale to be conditional upon Everton lodging its application for resource consent before the policy change came into force. Such conditions assumed, as had always been the practice in Hamilton, that the development contributions charges would be fixed at the rate outlined in the DC Policy in force at the date the application for resource consent was lodged, namely, in accordance with the earlier 2016/2017 DC Policy.

[57] Everton decided to advance Stage 3-5 of its development before deciding whether to sell the development. Stage 3-5 is estimated to provide approximately 150 affordable family homes to the market once completed.

[58] Consistent with the approach taken in respect of Stages 1 and 2, CKL attended several pre-application meetings with the PGU, the team responsible for processing

[59] At one pre-application meeting, Mr Wood asked the PGU team leader, Mr McNutt, to confirm the development contributions on Everton’s Stage 3-5 application would be levied under the 2016/2017 DC Policy. Mr Wood’s evidence was that Mr McNutt confirmed they would, provided Everton’s application for resource consent was lodged before the policy changed.

[60] Mr McNutt denies confirming that the 2016/2017 DC Policy would apply. His evidence is that he confirmed that the application would be accepted under s 88 of the RMA, and the lodgement date recorded. He says he made clear to Mr Wood he had no control over the calculation or levying of development contributions.

[61] On 15 June 2018, Everton lodged its application for resource consent for Stage 3-5 of its development. The application for resource consent was accepted by the Council for processing under s 88 of the RMA one week later, on 22 June 2018. This was before the 2018/2019 DC Policy came into force.

[63] On 6 August 2018, Everton was sent the first of two letters by the Council it considers are important and relevant to its claim. The first letter confirmed that development contributions would be required. It said:

On this basis, pursuant to the Local Government Act (LGA 2002) and Council’s 2016/2017 Development Contributions Policy, development contributions are required to be paid in respect of the development. A copy of Council’s Development Contributions Policy is available for viewing at www.hamilton.co.nz/dc.

The obligation to pay the development contribution charges will arise upon any one of the following occurring;

Based on the information provided in the application, and using the formula set out in the Policy, Council has estimated the development contribution charge at $5,057,178 .56 (incl . GST). A further breakdown of the charge is provided for from page two.

Council will confirm the final charge payable upon the receipt of further information regarding the final form of the development. Council reserves the right to adjust the estimate based on that further information if additional demand is deemed to arise above that assessed under this current assessment.

[64] The letter included an attachment entitled “Contribution Information Total – Stages 3, 4, 5”. The important parts of this attachment provide:

Consent Number:	011.2018.00006698.001	Assessment Office:	Central
Assessment Number:	100794-0v0	Assessment Date:	06/08/18
Property Address:	208 Rotokauri Road Nawton

Activity Description	Area of funding	Additional household unit equivalents (HUEs)	Amount (excl GST) $	Amount (incl GST) $
Reserves	Rotokauri	130.00	$239,074.99	$274,936.24
Stormwater	Lake Rotokauri	130.00	$1,225,990.29	$1,409,888.83
Transport	Rotokauri	130.00	$858,785.30	$987,603.10
Wastewater	Rotokauri	130.00	$1,275,186.70	$1,466,464.71
Water	Rotokauri	130.00	$798,509.29	$918,285.68
TOTAL			$4,397,546.57	$5,057,178.56

This consent application has been assessed in accordance with the 2016/2017 Policy.

[65] Everton says it took steps over the next year to get its development underway “on the ground”. The Council disagrees. I return to this issue shortly.

[66] It became apparent that the Council had a significant unanticipated contingent funding shortfall. This was first raised with elected members in a Finance Committee meeting on 4 December 2018. The Finance Committee requested that staff provide a report to be presented to the full Council in February 2019 outlining the options to resolve the funding shortfall.

[67] In a newspaper article on 7 December 2018, Mr Carstens is reported as saying that the LGA restricted what the Council could do to fix the shortfall, because the LGA “hamstrung” the Council as it contained a clause that “says when someone lodges a consent, that’s what they pay the development contributions at”.

[68] Mr Carstens presented a report to the full Council on 26 February 2019 entitled “Funding Growth Infrastructure Options Report”. As well as outlining the options for funding growth infrastructure, the stated purpose of the report was also to inform the Council about the options available to them “to ensure demand on public infrastructure arising from development is appropriately accounted for through Development Contribution revenue”, and also to seek a Council resolution to adopt Option 1 for funding that infrastructure and to agree a series of criteria to be considered when applying Option 1.

[69] The report set out in detail the Council’s anticipated funding shortfall and identified that the shortfall had occurred because of the number of applications lodged by developers in Peacockes and Rotokauri, the two substantial greenfield areas marked by the Council for future development, before the DC Policy change. With reference to Rotokauri, it was noted that the Greenway (referred to in the report as a “stormwater swale”) was budgeted to cost $128 million. In relation to it, the report noted the following:

21. In Rotokauri there are options being considered as to the ultimate funding source for the $128M stormwater swale, which could take this asset off the Council’s balance sheet, introduce third party funding, and/or reduce the cost of the build. If the asset is not on the Council’s balance sheet DCs cannot be levied against it. The Council should retain all rights available to it while these circumstances play out.

[70] The report acknowledged that previous DC policies had indicated the Council’s preference to levy development contributions at the earliest opportunity, usually being on resource consent because “this typically comes first in the development process”.

The 2018/19 DC Policy indicates in clause 10.4 that while it is still the Council’s preference to require DCs at the earliest available opportunity, where good reason exists, it reserves the right to require DCs at a later milestone, such as upon the granting of a building consent or service connection.

[72] The report then went on to note that the option recommended, which I refer to shortly, would enable all these development contributions to be collected at the building consent or service connection stage which would mean they would be paid at the rate of the 2018/19 DC Policy rather than the 2016/2017 DC Policy and “any funding gap (in relation to the applicable development) would be avoided”.

[73] The report also noted that the matters contained in the report in terms of the Council’s Significance and Engagement Policy had “a medium level of significance”.

[74] The options identified included Option 1, requiring development contributions at the building consent or service connection stage of development; Option 2, requiring development contributions at resource consent and levying a targeted rate to meet the funding gap; and Option 3, charging at resource consent and rates fund the funding gap.

[75] As outlined above, the report referred to the 2018/19 DC Policy which, while it outlined the Council’s preference to require development contributions at the earliest available opportunity, nonetheless provided that where “good reason” exists the Council could reserve the right to require them at a later milestone. The report recommended that a non-exhaustive set of criteria should also be adopted by the Council to be used to determine whether “good reason” exists.

ii whether the benefits arising from Council-funded projects and accruing to the development are not adequately reflected in the assessed DC charge;

[77] The Council endorsed Option 1 and a series of criteria as had been recommended.

[78] On 4 July 2019, some four months later, the Council sent a letter to Everton via CKL in which it referred to its earlier August 2018 letter (letter one) about the development contributions Everton would be required to make for Stage 3-5 of its development. The letter stated:

That previous estimate assumed that Council would require the development contributions to be paid upon grant of resource consent for the proposed development. Given the nature of the proposed development, and in accordance with the factors set out in Council’s resolution of 26 February 2019 (copy enclosed) Council considers there may be good reason to require the

development contributions to be paid upon the grant of building consent or service connection.

If that occurred, the development contributions will be assessed in accordance with the Development Contributions Policy that is in place at the time that the application for building consent or service connection was lodged with Council (see s 198(2A) Local Government Act 2002). If that occurs, the estimated development contributions are likely to increase significantly from the original estimate set out in Council’s letter dated 6 August 2018.

We note that the source of funding for strategic growth infrastructure is under review by central government and using an alternative funding mechanism to finance strategic infrastructure in the Rotokauri catchment is a possibility. If Council were to use this mechanism for that purpose, development contributions for your development would be materially different (and potentially lower) than the previous estimate and relate to different infrastructure.

Council would like to meet with you to discuss this matter. Please advise of a convenient time and date.

[79] Although contingent, the clear message from the letter, in my view, and bearing in mind the report by Mr Carstens and the reason for it, was that it was highly likely, if not certain, that if there was to be no alternative source of funding for the Greenway, Everton’s development contributions would be assessed under a different DC Policy from that advised in the August letter.

[80] Mr Ruske, of Everton, said he was shocked when he read this letter because he considered it was contrary to:

[81] The evidence before me was that Everton was not the only developer to receive such a letter.

[82] Mr Ruske attached a memorandum distributed by the Council’s Chief Executive Officer (CEO) to all councillors and senior leadership team to his affidavit. This memorandum suggested that the Council was justified in taking this course of action because the identified developers had “simply put their applications on hold, and they have not progressed, nor been granted”. Everton’s position is that it was actively pursuing its application, and this remains its position. Everton contends that these steps include “breaking ground” and committing significant financial resources to the Stage 3-5 development.

[83] The parties disagree about the progress of Everton’s development. The Council argues, consistent with the CEO’s memorandum that, around the time of the two letters, the development had stalled. This, the Council says, was because Everton failed to respond, or responded inadequately, to information requests from the Council under s 92 of the RMA (s 92 requests). Everton blames this delay on the Council, and in any event, argues the development had not stalled.

[84] The procedural tools provided to the Court in a judicial review claim are limited to that which it needs to discharge its supervisory function. There is no cross- examination or discovery as of right and ordinarily, as happened here, the hearing proceeds on the papers, albeit with oral submissions. This means that the Court cannot and should not attempt to resolve any disputed questions of fact.³I interpret this to mean that disputed facts relevant to an issue of consequence in the proceeding that cannot be determined without further testing by, for example, cross-examination, should not be determined upon judicial review.

[85] In this case, I am satisfied I can reach a view about the dispute on the papers without the need for cross-examination and without causing prejudice to any party. I now address the dispute.

[86] As outlined above, Everton lodged its subdivision consent application for Stage 3-5 of the development on 15 June 2018. On 22 June 2018 the application was accepted for processing and not rejected by the Council.

[87] The Council sent Everton its first request for further information under s 92 of the RMA on 12 July 2018. It concerned Everton’s stormwater strategy for Stage 3-5. Everton proposed an alternative on 2 October 2018, which the Council rejected. This led to a meeting on 5 November 2018 between the parties at which the Council says it “provided guidance to Everton on what it would consider an acceptable stormwater strategy”. On 26 February 2019, Everton provided a further revised interim proposal, and on 13 March 2020 formally responded to the s 92 request.

[88] The Council sent a second s 92 request for further information, also related to Everton’s stormwater strategy, on 28 April 2020, to which Everton responded on 14 September 2020.

[89] This led to a third s 92 request on 12 October 2020. Everton replied to this request on 23 July 2021 with a stormwater strategy the Council deemed acceptable.

[90] Mr Clarke, a consultant engineer engaged by the Council in relation to stormwater management in Rotokauri, and Mr Ewington, a planner employed by the Council, gave evidence about what they described as a “very long and protracted series of exchanges”.

[91] Mr Clarke described the consent process for Stages 1 and 2 of the development, highlighting that the Council also rejected Everton’s initial stormwater strategy, made a s 92 request, and ultimately accepted a centralised stormwater strategy that was connected to the Greenway.

[92] Mr Clarke describes being “incredulous” at Everton’s Stage 3-5 application. He considered it ignored what had been agreed on at Stages 1 and 2, particularly as it proposed a temporary private wetland. Everton’s formal response to the first s 92 request, in Mr Clarke’s opinion, missed important information, which led to the second s 92 request, but he said “persistent issues” prompted the third s 92 request.

[93] Mr Ewington’s evidence is more equivocal. He said that the large increase in scale proposed in the Stage 3-5 application required a more complicated stormwater strategy as a natural stormwater flow path crossed the Stage 5 lots. This increase in complexity drove the need to overhaul Everton’s stormwater strategy, which he said was the biggest factor in the delay between the Stage 3-5 application and the Council’s acceptance of Everton’s stormwater strategy.

[94] Mr Ruske’s evidence did not address Mr Clarke’s specific allegations. Rather, he blamed the delay and confusion on the Council’s approach to infrastructure, which he said was uncoordinated. In particular, Mr Ruske said the stormwater management strategy was a “moving goal” as the Council produced new solutions and conducted new modelling. He said the Council’s own design, timing and costings of the Greenway changed with each iteration of its LTP.

[95] Ms Rhynd, an environmental engineer employed by CKL, was responsible for resolving all aspects of Everton’s stormwater management strategy and the queries arising from its resource consent application for Stages 1 and 2, and for Stage 3-5 in relation to this topic. She, together with other members of CKL’s team, prepared the relevant consent documents and liaised extensively with the Council’s PGU Development Engineering team and other consultants brought in to assist the Council with its stormwater management. Her work also included modelling overland flow paths in Rotokauri.

[96] Ms Rhynd outlined the funding requirements for the Greenway that are set out in the LTP for 2021 – 2031. The entire Greenway is not anticipated to be constructed for some time and, as Mr Carstens’ report to the Council in February 2019 identified, if third party funding options does not materialise, the Council’s position is that the cost of it should be largely attributed to the development community. It is reasonable to infer that the timing of the construction of the entire Greenway and the funding of it has the potential to create considerable uncertainty for developers in this area. It also tends to support the development community looking into alternative stormwater strategies for individual sites that may have the effect of providing a solution to meet site specific stormwater solutions. This appears to be what occurred in relation to Stage 3-5 of the Everton development. The development of an alternative solution for this

[97] As I have outlined, it is not possible for the Court on judicial review to resolve factual conflicts. However, it is evident from the affidavits filed that there was a significant difference of opinion between the experts about the solution that would appropriately meet the stormwater issues created by Stage 3-5 of Everton’s development. While it is not the function on judicial review for the Court to delve into the merits of the various options presented, a perusal of them nonetheless does not substantiate the Council’s contention that Everton was not proceeding with its development by failing to undertake steps to progress it.

[98] The decision under review comprises the resolution of the Council on 26 February 2019 and the advice to Everton by the Council contained in its letter dated 4 July 2019 that is was required to pay development contributions upon the grant of building consent or service connection, thus engaging the 2018/19 DC Policy.

[99] Everton claims that the Council had already determined that the development contributions for the Stage 3-5 application for resource consent (the application) would be calculated in accordance with the 2016/2017 DC Policy. Everton claims that in making its decision that development contributions for Stage 3-5 were to be levied upon building consent or service connection, the Council made material errors of law and breached Everton’s legitimate expectation that the 2016/2017 DC Policy would apply to this application.

[100] Everton submits the Council misinterpreted or failed to apply s 198 of the LGA and its own 2016/2017 DC Policy when it determined it could apply its resolution of 26 February 2019 to the application. Alternatively, Everton submits the Council erred in law by making a decision under s 198 before purporting to have “changed its mind” and remaking the decision.

[101] Everton seeks a declaration that the Council’s decision that development contributions for the application are to be levied upon the grant of building consent or service connection is unlawful. It further seeks an order that the Council apply the 2016/2017 DC Policy to its application when calculating the required development contributions.

[102] The Council submits that s 198(1) of the LGA provides it with a discretion to choose one of three milestones at which to require a development contribution: the granting of a resource consent, building consent, or service connection, but because none of the milestone applications have been granted, the Council could not require a development contribution and therefore did not exercise its discretion for the purpose of s 198.

[103] Alternatively, the Council argues Everton has misinterpreted the 2016/2017 DC Policy.

[104] In relation to the claim that the Council breached Everton’s legitimate expectation that the 2016/2017 DC Policy would apply to the application, Everton submits that:

[105] Everton seeks a declaration that it had a legitimate expectation that the 2016/2017 DC Policy would apply to its application. It also seeks an order that the Council apply the 2016/2017 DC Policy to its application when calculating the required development contributions.

[107] The principles of judicial review are well established. Upon judicial review, the Court does not substitute its own factual conclusions for those of the decision maker.⁴Its task is to look at the process by which the decision maker reached its decision and to decide whether the decision, based on the requirements of the empowering instrument, was lawfully made.

[108] In Pring v Whanganui District Council, the Court of Appeal expressed the above principle as follows:

[The Court] merely determines, as a matter of law, whether the proper procedures were followed, whether all relevant, and no irrelevant considerations were taken into account, and whether the decision was one which, upon the basis of the material available to it, a reasonable decision- maker could have made. Unless the statute otherwise directs, the weight to be given to particular relevant matters is one for the consent authority, not the Court, to determine, but of course, there must be some material capable of supporting the decision.

[109] Counsel helpfully referred me to cases where judicial review has been considered in the context of development contributions.⁵These decisions confirm the

⁴Pring v Whanganui District Council [1999] NZCA 173; [1999] NZRMA 519 (CA) at 523.

legal test summarised by Richardson P in Wellington City Council v Woolworths New Zealand Ltd (No.2),⁶where it was held:

In summary, judicial review of the exercise of local authority power, in essence, is a question of statutory interpretation. The local authority must act within the powers conferred on it by Parliament and its rate fixing decisions are amenable to review on the familiar Wednesbury grounds. Rating authorities must observe the purposes and criteria specified in the legislation. So they must call their attention to matters they are bound by the statute to consider and they must exclude considerations which on the same test are extraneous. They are outside the scope of the power if their decision is made for a purpose not contemplated by the legislation. And discretion is not absolute or unfettered. It is to be exercised to promote the policy and objectives of the statue. Even though the decision maker has seemingly considered all relevant factors and closed its mind to the irrelevant, if the outcome of the exercise of discretion is irrational or such that no reasonable body of persons could have arrived at the decision, the only proper inference is that the power itself has been misused.

[110] It was also submitted that a high threshold applies to judicial review where decisions involve matters of public policy. It was submitted that there is a need for judicial restraint in such cases to address only those matters which require judicial supervision and control.⁷

[111] As outlined above, Everton submits the Council misinterpreted or failed to apply s 198 of the LGA and its own 2016/2017 DC Policy when it determined it could apply its resolution of 26 February 2019 to the application. Alternatively, Everton submits the Council erred in law by making a decision under s 198, and then purporting to have “changed its mind” and remaking the decision.

[112] Both Everton and the Council agree that the Council’s discretion to set development contributions is derived from, and constrained by, the provisions of the LGA.⁸

[113] However, under Everton’s interpretation the LGA requires territorial authorities to focus on the terms of the DC policy to ensure certainty and consistency. The Council submits Everton’s interpretation has the effect of subordinating the LGA (the empowering statute) to the DC policy (a secondary instrument made under the LGA).

[114] The LGA requires the Council to have a DC policy,⁹which is made following a consultation process¹⁰and is comprehensive in its terms.¹¹The Council may only require development contributions in accordance with the policy in effect at the relevant time.¹²This is because the charging of development contributions must be consistent, certain, and transparent.¹³In short, Everton submits the LGA places DC policies at the centre of decision making, and with good reason.

[115] Everton then turns to the words of the policy. It acknowledges cls 11.3, 11.5 and 11.7 of the policy preserve the Council’s discretion to choose at which milestone in a development to charge a development contribution. But Everton submits cl 11.8 uses mandatory language which requires the Council to calculate development contributions under the policy in place at the time the first application is made, regardless of the milestone the Council chooses.

[116] Everton also submits s 198(2A) of the LGA has the same effect as cl 11.8 of the DC policy. It provides:

For the purposes of subsection (2), a development contribution must be consistent with the content of the policy adopted under section 102(1) that was in force at the time that the application for a resource consent, building consent, or service connection was submitted, accompanied by all required information.

[117] Everton concludes that s 198(2A) and cl 11.8 reflect the same intention; to allow developers to predict their liabilities to councils with certainty, regardless of any change in council policy during the development.

[118] The Council submits that s 198(1) of the LGA provides it with a discretion to choose one of three milestones at which to require a development contribution: the granting of a resource consent, building consent, or service connection, and that statutory discretion must be exercised in accordance with the LGA itself, rather than the content of the subordinate DC policy. It argues that it is only once the discretion in s 198(1) is exercised that the relevant policy is determined.

[119] In the present case, the Council submits none of the milestones in s 198(1) have been reached because Everton has only applied for but has not been granted a resource consent, building consent, or service connection. The Council submits it cannot require a development contribution until the grant of one of these milestones, and therefore the content of the DC policy in force long before any future exercise of discretion cannot be relevant.

[120] Following on from this, the Council submits the second letter and Mr Wood’s conversation with Mr McNutt could not legally have constituted an exercise of this discretion. Rather, both the letter and conversation were indications of how much Everton would have to pay, provided the Council chose to exercise its future discretion in a particular way.

[121] If it is wrong about this, the Council argues Everton has misinterpreted the 2016/2017 DC Policy, because it submits cl 11.8 does not unequivocally commit the

[122] The law that applies was not in dispute. An error of law must be material.¹⁴In other words, the error must affect the making of the decision and the decision itself.¹⁵ The misinterpretation of a statutory provision can amount to an error of law.¹⁶

[123] The critical question in assessing this ground of review is whether the Council complied with the statutory requirements of the LGA when it exercised its power to require Everton to pay development contributions. As Potter J said in Neil Construction v North Shore City Council:¹⁷

... a development contributions policy and the processes in relation to it, must comply strictly with the relevant provisions of the Act which are the sole source of a council’s power to exact development contributions.

[124] As outlined above, s 198 of the LGA provides the Council with the ability to select one of three milestones at which to require a development contribution, either when a resource consent, a building consent, or an authorisation for a service connection is granted. The section provides a council “may” require contributions at those triggers though contemplates the decision being made earlier. While the 2016/2017 DC Policy preserves aspects of this discretion, cl 11.8 makes clear by its use of the word “will” that, regardless of the way in which the Council exercises that discretion, it must calculate the development contribution in light of the policy that was in force, not just at the earliest of the s 198 milestones (here, the granting of a resource consent), but at the point the earliest complete application is submitted.

¹⁴Christiansen v Director General of Health [2020] NZHC 887 [2020] 2 NZLR 655 at [44].

[125] The evidence establishes that Everton submitted its application for resource consent when the 2016/2017 DC Policy was in force. Section 198(2A) provides that a development contribution must be consistent with the content of the policy in force at the time that the application for a resource consent, building consent or service connection was submitted, accompanied by all required information. Subsection (2A) is expressed to apply “for the purposes of subs (2)”. In turn, that section provides a territorial authority may only require the development contribution as provided for in a policy adopted under s 102(1) that is consistent with s 201. There is no issue that the policy concerned has been adopted under s 102(1), or that it is consistent with s 201. It seems to me that these sections, if there were to be a challenge to them, would relate more to the content of the policy and potentially its vires. That is not the case here. The question is more how s 198(1) fits with subs (2A).

[126] For ease of reference, I refer to the three options in s 198 as “triggers”. This is the language that was used in the hearing, and it is helpful because it avoids unnecessary repetition and describes in an appropriate way the process to be followed.

[127] A territorial authority has the power to determine at what stage of a development, a development contribution will be required. This power is discretionary, but it is also limited to an extent by subss (2) and (2A). While I have opined that a challenge to the requirement of a development contribution on the grounds that it has not complied with s 198(2) is likely to be a challenge to the vires of the policy, reference to s 102(1) is helpful to the present issues to the extent that it outlines that the adoption of a policy is “in order to provide predictability and certainty about sources and levels of funding”.

[128] This theme is echoed in s 197AA which outlines the purpose of development contributions. The purpose is to enable territorial authorities to recover from those undertaking development “a fair, equitable and proportionate portion of the total cost of capital expenditure necessary to service growth over the long term”. The purpose is supplemented by the principles outlined in s 197AB. The principles, which speak to transparency, predictability, when development contributions are appropriate, and how they should be calculated, apply not only when the DC Policy is being prepared, but also must be taken into account by persons requiring development contributions

[129] In this case, Everton lodged its application for resource consent when the 2016/2017 DC Policy was in force. Section 88 of the RMA provides that a person may apply to the relevant consent authority for a resource consent, and a consent authority can determine that the application is incomplete, but it must do so within 10 working days after an application was first lodged. Section 198(2A) of the LGA refers to an application being “submitted, accompanied by all required information”. Section 92 of the RMA enables a consent authority to request an applicant for consent to provide further information relating to the application. This must occur at any reasonable time before a hearing of the application or before a decision is made whether to grant or refuse the application if there is no hearing. The evidence in this case establishes that three s 92 requests were all made in relation to stormwater design for Everton’s Stage 3-5 application.

[130] It is unfortunate that s 198(2A) does not adopt the same wording as that provided in the RMA. However, I am satisfied that for the purposes of s 198(2A), the word “submitted” is the same as the word “lodged” used in s 88. I am also satisfied that because s 88 enables an application to be returned if incomplete, the reference in s 198(2A) to an application being accompanied “by all required information” means an application that has been lodged and accepted for lodgement under s 88, rather than a requirement that all s 92 requests have been completed. Accordingly, I interpret s 198(2A) as requiring a development contribution to be consistent, in this case, with the 2016/2017 DC Policy. That was the policy in force at the time the application for resource consent was submitted, accompanied by all required information, and cl 11.8 required development contributions to be calculated when the application for resource consent was made.

[131] I am not persuaded by the Council’s argument that cl 11.8 was not binding because of the provisions of s 198. This is because s 198(2A) provides, in my view, the legal authority for cl 11.8. Deciding to specify the point at which development contributions would be determined was an option available to the Council when it

[132] As well, s 202(1)(b) of the LGA requires the schedule of development contributions included in a DC Policy to specify the event that will give rise to a requirement; the event being the grant of resource consent, building consent or the authorisation for a service connection. These are expressed as alternatives because of the use of the word “or”, which does not appear in s 198. The 2016/17 DC Policy does not specify an event in the schedule as s 202(1)(b) requires, but it does provide for it in cl 11, which, if read in its entirety and because of cl 11.8, binds the Council in this case to Everton’s development contributions being calculated under this Policy because it had submitted its resource consent application at a time when this Policy was in force.

[133] In my view, the 6 August 2018 letter specifically said that development contributions were required to be paid in respect of Everton’s development and that this requirement was made pursuant to the LGA and the Council’s 2016/17 DC Policy, the latter being the DC Policy in force at the time Everton’s application for resource consent was submitted. Following the acceptance of the application it follows that the Council was then obliged to determine the amount of Everton’s development contributions, payable in due course to the Council, under the 2016/2017 DC Policy because that is what ss 198(2) and (2A) required.

[134] I now turn to consider the legal effect of the 4 July 2019 letter, the effect of which was to contend that the act of requiring had not yet occurred.

[135] Most statutory powers may be re-exercised only to correct technical errors.¹⁸ Everton submits the Council erred by determining to apply the 2016/17 DC policy, then purporting to remake its decision.

[136] Everton submits the Council exercised the power in s 198(1) when it determined to apply the 2016/17 DC policy to the development and communicated that decision to it in August 2018.

[137] Everton argues that the wording of the August letter indicates the Council had made a final determination:

Council has determined that the proposed development will generate a demand for reserves, or network infrastructure with the effect that new or additional assets or assets of increased capacity will be required to be provided by Council. On this basis, pursuant to the Local Government Act (LGA 2002) and Council’s 2016/2017 Development Contributions Policy, development contributions are required to be paid in respect of the development.

[138] Further, Everton refers to a “Contributions Information” sheet, which accompanied the letter and noted that the Council’s assessment would not change other than in certain circumstances:

It provides you with a development contributions assessment based on your consent application which will not change unless your consent or the information you provided is varied in some way (errors and omissions excluded).

[139] Everton submits the Council typically relied on these standard form information sheets to inform developers it had made a final decision under s 198(1) of the LGA. It refers to an internal Council memorandum of 12 January 2020, which sets out the following:

To date, the ‘Development Contributions Notice’ has been relied on by Council as also establishing and communicating the ‘requirement’ of the

¹⁸Interpretation Act 1999, s 13; Legislation Act 2019, s 46; and Goulding v Chief Executive of Ministry of Fisheries [2003] NZCA 244; [2004] 3 NZLR 173 (CA) at [48]–[49], citing Law Commission A New Interpretation Act (NZLC R17, 1990) at 123.

development contribution under section 198 of the LGA, even if the consent has not been granted.

[140] Everton argues s 198 means that while the Council may not require a development contribution until one of the milestones is reached, this does not prevent it from determining that milestone in advance. In other words, the power that arises once a milestone is reached is the power to require a developer to pay, not the power to determine how to exercise that discretion.

[141] The Council repeats its above arguments that it had not, in the terms of the LGA itself, exercised its discretion under s 198 and so could not have been unlawfully remaking a decision. Indeed, the Council contends it was unable to do so as a relevant milestone under s 198(1) had not been reached.

[142] As far as Everton was wrongly given the impression the Council had already made a decision, the Council submits this is better considered under Everton’s breach of legitimate expectation cause of action.

[143] Whether the Council had already determined under s 198(1) to require a development contribution at resource consent stage (and therefore later unlawfully changed its mind) is a question of law and fact.

[144] In my view, the plain meaning of s 198(1) does not suggest any decision cannot be made in advance; the Council “may require a contribution” when “a resource consent is granted”.

[145] Subsection (2) expressly permits the Council to make determinations in advance of the milestones being reached, in the form of its DC policy, then requires the Council not to deviate from those determinations:

A territorial authority may only require the development contribution as provided for in a policy adopted under section 102(1) that is consistent with section 201.

[146] Section 201(2) requires the DC Policy to contain a schedule in accordance with s 202. As addressed earlier, s 202 provides for the schedule to specify which trigger will give rise to a requirement for a development contribution.

[147] Pursuant to my discussion above concerning material error of law, s 202(1)(b) of the LGA clearly enables the Council to lawfully fetter its discretion by committing itself to a particular milestone before the discretion arises, and it has done that in the 2016/2017 DC Policy.

[148] In its August 2018 letter, the Council advised it had determined that the proposed development met the statutory criteria and, on that basis, advised that development contributions were “required to be paid”.

[149] Insofar as the Council submitted that the August letter was an “estimate”, this is only correct, in my view, to a degree. This is because the letter itself contained the following:

Council will confirm the final charge payable upon receipt of further information regarding the final form of the development. Council reserves the right to adjust the estimate based on that further information if additional demand is deemed to arise above that assessed under this current assessment.

[150] I agree with Everton that this excerpt from the letter circumscribed the basis upon which the estimated development contribution charge could change. As well, Everton referred to the accompanying “Contributions Information” sheet which stated that the Council’s “assessment” “will not change” except in certain circumstances. These were confined to the consent or information provided being varied in some way. For these reasons, I accept that although the August letter reserved the Council’s ability to adjust the estimated development contribution charge itself, the Council was clearly of the view that the assessment, namely, the milestone adopted or the policy upon which the estimate was based, would not change. They advised Everton accordingly.

[151] It was the funding shortfall which precipitated the February resolution and the July letter purporting to apply the 2018/2019 DC Policy. In my view, the July 2019 letter is a purported reconsideration of a decision the Council had already made and communicated to Everton in August 2018.

[152] In the absence of an express power in the LGA to allow the Council to broadly reconsider or change a decision it makes under s 198(1), it was submitted that it could only do so if ss 13 and 16 of the Interpretation Act 1999 applied.¹⁹In relation to these sections, the Courts have held that decision makers are not empowered by them to simply “change their minds”.²⁰

[153] I accept Everton’s submissions that neither of the sections can be invoked as there is no relevant error or admission which the Council sought to address by its decision, and neither were there exceptional circumstances necessitating any change to the Council’s decision under s 16.

[154] I conclude that the Council in attempting to change its decision, misinterpreted s 198 of the LGA and that this amounts to a material error of law.

[155] I have found that the first cause of action has been established by Everton. In case, however, I am wrong about this, I proceed to consider the third cause of action.

[156] Everton claims that in deciding to change course and require development contributions on the grant of building consents, the Council breached Everton’s legitimate expectation that development contributions would be required on the grant of resource consent. In other words, Everton claims the Council has breached its legitimate expectation that the 2016/2017 DC Policy would apply to its Stage 3-5 application.

¹⁹These sections have now been renumbered as ss 46 and 51 of the Legislation Act 2019 respectively. As the Interpretation Act 1999 applied, the decisions in respect of this matter were made with the earlier Act applies.

²⁰Goulding v Chief Executive Ministry of Fisheries, above n 18, at [49] – [51]; Pub Charity Incorporated v Secretary of Internal Affairs [2015] NZHC 195 at [72] – [75]; and Zaoui v Attorney-General [2004] NZCA 228; [2005] NZLR 577 (CA) at [52], citing William Wade and Christopher Forsyth Administrative Law (8^thed, Oxford University Press, Oxford, 2000) at 235.

[157] The general principle underpinning legitimate expectation was formulated by the Privy Council in Attorney-General of Hong Kong v Ng Yuen Shiu where it said:²¹

... when a public authority has promised to follow a certain procedure, it is in the interest of good administration that it should act fairly and should implement its promise, so long as implementation does not interfere with its statutory duty.

[158] Everton seeks both declaratory and substantive relief. I note at the outset that, while New Zealand applicants have established legitimate expectations that they will be consulted, or that a particular procedure will be followed, a legitimate expectation of a substantive outcome has never been successfully argued. There is some doubt as to whether courts can ever give effect to a substantive legitimate expectation, as an obligation to grant a particular outcome would fetter statutory discretion and intrude on the role of the executive.²²

[159] The doctrine of substantive legitimate expectation has been rejected in Australia as it constitutes judicial interference with executive decision-making,²³and in Canada on the basis that the principle of legitimate expectation is part of the doctrine of fairness or natural justice, which only relates to procedure.²⁴

[160] In New Zealand Association for Migration and Investments Inc v Attorney- General, a foundational case for legitimate expectation in New Zealand, Randerson J approved the existence of the doctrine but said:²⁵

In no case, however, could I envisage a Court directing that a substantive benefit (such as a licence or permit) be granted. That would be to usurp the function of the Executive.

²³Habib v Commonwealth (No 2) [2009] FCA 228, (2009) 175 FCR 350 at [70]; citing Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6, (2003) 214 CLR 1 at [66] and [67].

²⁴Khadr v Canada (Attorney-General) [2007] 2 FCR 218, (2006) 268 DLR (4th) 303 at [116]– [119]; citing Rice v New Brunswick [2002] 1 SCR 405.

²⁵New Zealand Association for Migration and Investments Inc v Attorney-General [2006] NZAR 45 (HC) at [159].

[161] In Comptroller of Customs v Terminals (NZ) Ltd the Court of Appeal broadly adopted Randerson J’s formulation of the test for a legitimate expectation, but in relation to his stance on substantive relief said:²⁶

... the Court may require the decision maker to follow a process that he or she has expressly or impliedly undertaken to follow. Examples include an obligation to give notice to an affected party or to consult before making a decision. In other cases, the court may direct the decision maker to reconsider the decision in the light of the expectation. However, relief in the form of a substantive outcome is rarely, if ever, granted.

[162] Commenting on the above, Kós J noted the Court of Appeal had not “shut the gate altogether” on substantive legitimate expectation, but that the doctrine might only be recognised in a “truly exceptional case”.²⁷

[163] The Court of Appeal appears to have taken a more expansive approach to substantive relief in B v Waitemata District Health Board, where it said:²⁸

A public authority may, by practice or express promise, commit itself to a particular course of action, procedure, or possibility of a substantive outcome. The extent to which this has occurred must be considered by reference to all the surrounding circumstances.

[164] However, these comments were obiter; as in B there was no evidence the decision-maker had created an expectation, so Court was not required to consider what relief to grant.

[165] A series of recent High Court cases lend more support to substantive legitimate expectation. In Oosterveen v Ministry of Business, Innovation and Employment, Collins J suggested substantive relief could be granted after a balancing of individual and public interests.²⁹

²⁶Comptroller of Customs v Terminals (NZ) Ltd [2012] NZCA 598, [2014] 2 NZLR 137 at [155].

[166] In Chamberlain v Attorney-General, Palmer J considered the test proposed in Oosterveen could eliminate existing judicial concerns over substantive legitimate expectation:³⁰

[74] I consider New Zealand judicial reluctance about claims of substantive legitimate expectations often derives from judicial concerns that it might allow the role of the decision-maker to be usurped in two ways. The first is that it is not usually legitimate to fetter a decision-making discretion with an expectation of a particular substantive outcome. The second is that it is rarely appropriate to grant substantive relief. Both concerns can be taken into account in the application of the Terminals concept of legitimate expectations and in the way Collins J suggests.

[167] These words were approved by Fitzgerald J in Hugh Green Ltd v Auckland Council, although the Judge applied the test from Comptroller of Customs v Terminals (NZ) Ltd, rather than Oosterveen.³¹

[168] Both parties in the present case applied the test from Comptroller of Customs v Terminals (NZ) Ltd, which is summarised as follows:³²

[125] Where legitimate expectation is raised, the inquiry generally has three steps. The first is to establish the nature of the commitment made by the public authority whether by a promise or settled practice or policy. This is a question of fact to be determined by reference to all the surrounding circumstances. A promise or practice that is ambiguous in nature is unlikely

to be treated as giving rise to a legitimate expectation in administrative law terms.

[126] The second is to determine whether the plaintiff's reliance on the promise or practice in question is legitimate. This involves an inquiry as to whether any such reliance was reasonable in the context in which it was given.

[127] The third, and often most difficult part of the inquiry, is to decide what remedy, if any, should be provided if a legitimate expectation is established.

[169] On the first stage of the test, Everton relies heavily on these words from E v Attorney-General:³³

... legitimate expectation generally appears to provide a basis for relief where the authority in question had made a clear and unambiguous representation as to the way in which a discretion would be exercised...

[170] The representation must be made by a decision-maker with actual or ostensible authority.³⁴Everton suggests the following test for ostensible authority, drawing on English authority:³⁵

[171] On the second stage of the test, Everton notes that while it is not entirely settled, the courts have generally required applicants to have relied on the expectation to their detriment. Everton cites Air New Zealand Ltd v Wellington International Airport Ltd, in which Wild J said:³⁶

... the Judge [Randerson J in New Zealand Association for Migration and Investments] concluded that “it is not settled” whether detrimental reliance is

³⁴Philip A Joseph, Joseph on Constitutional and Administrative Law (5th ed, Thomson Reuters, Wellington, 2021) at 1164.

³⁵Everton relies on Mark Elliott, Jack Beatson and M.H. Matthews (eds) Beatson, Matthews, and Elliott's Administrative Law: text and materials (4th ed, Oxford University Press, Oxford, 2011) at 212.

³⁶Air New Zealand Ltd v Wellington International Airport Ltd [2008] NZHC 1781; [2009] NZAR 138 (HC) at [69].

a necessary criterion. I agree, but add that that breach of legitimate expectation will almost always require detrimental reliance.

Detrimental reliance upon representation is not essential but it is relevant. Absence of detrimental reliance will be rare. The principles of good administration prima facie require adherence by public authorities to their promises.

[173] If the first and second stages of the test are made out, the onus shifts to the Council to show some satisfactory reason that justifies the frustration of the legitimate expectation.³⁸

[174] In terms of what might amount to a “satisfactory reason” guidance is found in New Zealand Association for Migration and Investments Inc v Attorney-General where Randerson J observed that this qualification:³⁹

... reflects two key policy considerations which often lie at the heart of legitimate expectation cases. On the one hand there is a public interest in holding a public authority to promises made in the interests of proper public administration and allowing people to plan with some assurance. On the other, there is also a public interest in allowing governments and other public authorities to change policy from time to time when it is perceived to be appropriate to do so. Indeed, the adoption of new policy to meet changing circumstances may be viewed as the duty of any government in furthering the public interest.

[175] Randerson J then suggested the factors that could be considered in determining whether a reason is satisfactory:⁴⁰

... the degree of specificity of the promise; the significance of the consequences to the individual or class concerned if the promise is not kept or the prior practice not followed; whether the decision maker has given proper consideration to the position of the affected parties; what provision, if any, has been made to accommodate those affected by way of transitional provisions whether by the creation of exceptions from the application of the new policy or by compensation or otherwise; and the nature and strength of any countervailing public interest factors justifying the course proposed.

³⁷Talleys Fisheries Ltd v Cullen HC Wellington CP287/00, 31 January 2002 at [48]; adopted in
Sinclair v Accident Compensation Corporation [2012] NZHC 406, [2012] NZAR 313 a [35].

[176] The degree of scrutiny to be applied at this stage of the test will vary depending on the broadness of the impugned decision. Courts will “intensely” scrutinise the frustration of promises “made to an individual or small class with serious consequences for them if the promises are not kept”, but:⁴¹

In other cases, such as where the policy choices are very much in the macro- political field and there are strong countervailing grounds to support the course adopted, the Court may give greater recognition to the wider public interest in enabling governments to adjust policy including, when change is required and how, in their judgment, it is to be achieved.

[177] Citing Fairmont Holdings (No 2) Ltd v Christchurch City Council, E v Attorney-General and R v Secretary of State for the Home Department, ex parte Khan,⁴²Everton submitted that the courts have found that a legitimate expectation has been established in circumstances similar to the ones at issue in this case. However, a closer examination of these cases does not, in my view, support this submission.

[178] I note the first of those cases, Fairmont Holdings (No 2) Ltd v Christchurch City Council, involved an application for an interim injunction. Hardie Boys J granted the injunction, noting only that legitimate expectation was “in the course of judicial development”.⁴³

[179] The second, E v Attorney-General, was overturned on appeal. In the High Court Fisher J found applicants for refugee status had a legitimate expectation the decision-maker would apply a presumption in favour of granting them temporary visitor’s permits.⁴⁴However, the Court of Appeal found the doctrine of legitimate expectation irrelevant. Whether the presumption existed was a matter of statutory interpretation.⁴⁵

⁴¹New Zealand Association for Migration and Investments Inc v Attorney-General, above n 25, at [158].

⁴²Fairmont Holdings (No 2) Ltd v Christchurch City Council (1989) 12 NZTPA 455 (HC); E v Attorney-General above n 33; R v Secretary of State for the Home Department, ex parte Khan [1984] EWCA Civ 8; [1984] 1 WLR 1337 (CA).

[180] The third, Ex parte Khan, involved a couple living in Britain who applied to adopt their nephew from Pakistan.⁴⁶The couple received a letter from the Home Office explaining the criteria upon which their application would be judged, but an entry clearance officer then refused the application on a basis not set out in the letter. Parker LJ held the letter created a legitimate expectation of the criteria to be applied in determining the application.

[181] The Court did not, however, grant substantive relief, but quashed the decision and invited the Secretary of State to determine the application either on the criteria in the letter, or that applied by the entry clearance officer. This was helpful to the applicants in Khan as they were then able to make submissions on the application of either criteria. It is less helpful to Everton, as in this case the choice of policy to be applied is determinative. I also note the decision in Khan affected only the applicants; the granting of relief did not have the economic or political implications described by Randerson J in the New Zealand Association for Migration case.

[182] Everton claims that the Council’s commitment is evident in the 2016/2017 DC Policy itself, the representations made to it by Mr McNutt, the Council’s August letter, and the Council’s settled practice.

[183] First, cl 11.8 of the 2016/2017 DC Policy is an unambiguous and unequivocal representation that, no matter which milestone was chosen, the policy in force at the time of the earliest application for either resource consent, building consent or service connection would be used to calculate development contributions.

[184] Second, Mr Wood’s evidence about his pre-application meeting with Mr McNutt is that:

Shortly before we were due to file Everton’s application, I recall having a conversation with Fraser McNutt about the DCs for the application, and specifically about the upcoming change to the DC Policy. I wanted to know

that that (sic) the Council was going to apply its DC Policy according to its terms. When I asked him about the DC Policy that would be applied to Everton’s application, he confirmed it would be the 2016/2017 DC Policy. I followed up by confirming that the Council were not “going to play silly buggers with the application.” He said, “No, we’re not, just get the application in prior to July.”

[185] The Council, in reply, points to Mr McNutt’s evidence that he made a qualified representation to Mr Wood that development contributions would be calculated under the 2016/2017 DC Policy, if the Council chose to require development contributions at the resource consent milestone.

[186] Everton, in turn, considers this version of events implausible. Mr McNutt was unlikely to bring up the possibility of a different milestone being chosen as the Council had never used a different milestone. Mr Wood had called the meeting to confirm which policy would apply and, had he been given such a qualified reply, he would have urgently sought further assurance.

[187] Everton also submitted that Mr McNutt’s evidence is also contradicted by the Waikato Times article in which Mr Carstens appeared to agree the 2016/2017 DC Policy would apply to Everton’s development.⁴⁷

[188] Everton further submits Mr McNutt had ostensible authority to make the representation. Referring to its suggested test, it submits the Council could lawfully commit to requiring development contributions at the earliest milestone. Mr McNutt had, and held himself out as having a position of authority at the Council; which was why Mr Wood sought his assurances. And there was no reason why Mr McNutt would not have been authorised to make the representation.

[189] Everton submits an additional unambiguous and unequivocal representation was made to it in the August letter. Here, Everton repeats its arguments about the Council purportedly and invalidly remaking its decision.

[190] On this point, the Council submitted the letter clearly indicated the development contributions enclosed were an “estimate” and could change. Everton

⁴⁷Elton Rikihana Smallman “New ratepayers in gun as Hamilton City Council staff work to fill

[191] Finally, Everton submits requiring development contributions at the first milestone was the Council’s settled practice. Mr Olliver could not recall any time, before or after Everton’s application, that this practice has been departed from.

[192] Everton provided extensive evidence of correspondence from the Council that this was a settled practice. For example, this passage previously from the Council’s website:

If your consent or service connection was lodged on or between 1 July 2016 and 30 June 2018 then your developments contributions will be assessed under the 2016/2017 Development Contributions Policy.”

[193] Everton also refers to the actions of other developers as demonstrating a shared understanding of Council practice. As the Council submits, a large number of consent applications were received shortly before the 2018/2019 DC Policy came into effect, presumably on the assumption those applications would therefore be assessed under the 2016/2017 DC Policy. And Everton’s efforts to sell the development were met with offers conditional on Everton lodging its application for resource consent in time.

[194] The Council accepts that its standard practice prior to the 2018/2019 DC Policy was to consistently require development contributions at the earliest development milestone, namely, when a resource consent is granted. They accept further that developers in Hamilton, which had previously engaged with it in respect of development contributions, would be familiar with this approach. It also accepts that it had given no indication to Everton prior to its July letter that it would deviate from this standard practice. The overall submission made on behalf of the Council is that no binding commitment or exercise of the discretion in s 198(1) had yet been made, given that no development milestone had been passed.

[195] As the Council submits, the 2016/2017 DC Policy itself makes no unambiguous commitment to a particular milestone. However, in my view, cl 11.8 unambiguously represents that development contributions would be calculated under the policy in force at the time Everton submitted its application for resource consent. For this reason, and others discussed above, I reject the Council’s argument that no binding commitment had been made.

[196] Regarding the oral representations made by Mr McNutt, I consider Mr Wood’s evidence more credible. As Everton submits, Mr McNutt would have been unlikely to make a qualification the Council had never previously made, and Everton would likely have reacted in some way to such a qualified reply to a request for assurances.

[197] The Waikato Times article must be viewed with caution, but Mr Carstens’ words in the article support Mr Wood’s evidence; that the Council had at that stage at least informally committed to requiring development contributions at the earliest milestone, despite the resulting funding shortfall.

[198] Mr Carstens words also support Everton’s evidence of a settled practice. Mr Carstens said:

“We can’t address the funding gap in the new policy because the law restricts us in terms of what we can charge... We are actually hamstrung by a clause in the Local Government Act that says when someone lodges a consent, that's what they pay the development contributions at.”

[199] This suggests Mr Carstens was expressing his view at the time, which was that development contributions had to be calculated under the policy in force at the time the resource consent application was lodged.

[200] Again, the Council correctly notes that the August letter reserved the Council’s right to charge development contributions at any of the LGA milestones. But, consistent with cl 11.8 of the 2016/2017 DC Policy, the letter estimates Everton’s development contributions under that policy and limits the grounds upon which the estimate could change to those relating to the “final form of the development” or “additional demand”. Regardless of the LGA milestone ultimately chosen by the

[201] Taking these matters into account, I consider the above representations sufficient to ground a legitimate expectation.

Did Everton legitimately rely on the Council’s representations to its detriment?

[202] Two issues arise. First, whether Everton’s expectation was legitimate. Second, whether Everton relied on the legitimate expectation to its detriment.

[203] The LGA requires the Council to have a development contribution policy and to require development contributions only in accordance with that policy.⁴⁸The policy can even commit the Council to a particular milestone in advance, although the 2016/2017 DC Policy did not do this.⁴⁹

[204] As a general principle, development contributions should be predictable and consistent with the DC policy.⁵⁰I consider the purpose of cl 11.8 of the policy was to allow developers to proceed with some certainty. This is not a case, like in Comptroller of Customs v Terminals (NZ) Ltd, where the applicant claimed a legitimate expectation that would result in the decision-maker acting inconsistently with the purposes of the relevant statute.⁵¹

[205] Based on the words of Mr McNutt and the August letter, I conclude that Everton’s expectation was, in this sense, legitimate.

[206] The Council is likely correct that Mr McNutt did not have authority to make the decision, but I agree with Everton that it reasonably understood Mr McNutt was capable of at least communicating the decision of the Council to it. This is because,

[207] In Hugh Green Ltd v Auckland Council, reliance on an oral representation alone was not legitimate, particularly as the accompanying written representations were more ambiguous, if not contradictory.⁵²But, in this case, Mr McNutt’s representations were backed up by both the Council’s usual practice, and the August letter.

[208] I am satisfied Everton’s reliance on the expectation was reasonable and legitimate.

[209] The Council submits that there is no genuine reliance established on the facts of this case. It argues that once Everton received the July 2019 letter indicating the new approach that would be taken, Everton did not change its course in relation to its subdivision and there is no evidential basis to suggest it was too committed to retreat by July 2019.

[210] The Council relies on the evidence of Mr Ewington which outlines that, as of 4 July 2019, Everton’s subdivision had stalled as it had not responded to a s 92 RMA request for further information. Very little progress was being made to resolve ongoing stormwater management issues, and there was no evidence of work being done on the site.

[211] The Council submitted that Everton’s actions since 4 July 2019 were not legitimately and reasonably undertaken in reliance on an expectation that it would be charged development contributions under the 2016/2017 DC Policy because, since then, Everton has been on notice that the 2016/2017 DC Policy would not apply. Despite this knowledge, the Council submitted Everton continued with its Stage 3-5 subdivision.

[212] Everton submitted that relying on the Council’s representations, it took the following steps:

[213] Essentially, the Council submits Everton did not change course after receiving the second letter and so cannot be said to have relied on the first letter to its detriment. Everton submits it broke ground on the development and began work on infrastructure between the two letters, in reliance on the first letter and at that point, it could not change course without wasting its spending on planning and infrastructure. Everton submits the detriment arises from its inability to make informed decisions about the development.

[214] The debate concerning delays between s 92 requests and replies has already been canvassed. Regardless, the Council’s submissions do not focus on where blame

[215] I consider the evidence from both parties suggests Everton actively advanced its application after receiving the first letter. Everton suggested a revised proposal on 2 October 2018, attended a meeting with the Council on 5 November 2019, and submitted a further revised proposal on 26 February 2019. These proposals would have been made at cost to Everton.

[216] The Council submits that, as a result of the delay, Everton has not started work on Stage 3-5 of the development. Everton’s evidence appears to support this claim. However, Everton’s argument is that, having begun its preliminary work on infrastructure, it has committed to completing the development, based on its earlier (and now inaccurate) estimate of costs. The Council simply reply that there is no evidence Everton is too committed to change its plans.

[217] Again, I am satisfied that Everton has relied on the legitimate expectation to its detriment. While, as the Council submits, there is no solid evidence from Everton that its initial infrastructure work represents a point of no return, it has undoubtedly spent several years planning a particular development. These plans have been made on the basis of the available information, including the expectation around development contributions. Everton has begun to carry out its plans. Any subsequent change to the plan, made necessary by the Council’s frustration of Everton’s legitimate expectation, must lead, in my view, to some kind of detriment.

[218] The Council submits Everton must fail on the final stage of the test; the balancing of the unfairness of frustrating the legitimate expectation against the broader public interest. This is because it is claimed the Council had satisfactory reasons for doing so; Rotokauri is a key greenfield growth area, the Greenway is necessary for development to proceed in the area, and the decision to charge development contributions at the building consent stage was the fairest of the available options.

[219] The Council first points to the purposes and principles of development contributions in ss 197AA and 197AB of the LGA. These require development contributions to be levied proportionally to the persons who create the need for and benefit from the resulting infrastructure, and in general to recover from developers a fair and equitable portion of the relevant expenditure.

[220] The Council submits these purposes would be frustrated if certain developers paid development contributions based on the 2016/2017 DC Policy. This would create a huge budget deficit.⁵³To make up for this deficit, the Council considers its options are to:

[221] The Council submits option (d) was fairest outcome, and the only one consistent with the purposes and principles of development contributions in the LGA.

[222] Everton argues a funding shortfall may not exist, and to the extent it does, it is the Council’s fault and cannot justify its decision.

[223] First, the alleged funding shortfall will only exist if the other affected developers pursue their applications. If those applications are withdrawn or substantially changed, any replacement applications will be lodged after the

⁵³The Council points to the evidence of Mr Carstens, who calculates the three developers that applied for resource consent before the cut-off point would pay an additional $24,006,789 under the 2018/2019 DC Policy.

[224] In any event, Everton submits that if a shortfall exists, the Council is to blame, and cannot then raise a fairness argument to shift the burden of paying for its mistakes onto Everton. This is especially so as Everton considers the evidence suggests the Council was well aware that developers would attempt to have their applications considered under the 2016/2017 DC Policy, as those developers conducted pre- application meetings with the Council. The Council was also aware of the risk of a shortfall, as evidenced by the Council’s chief executive’s and Mr Carstens’ comments to the Waikato Times.⁵⁴

[225] Essentially, Everton argues the Council brought its problems on itself through poor planning. It submits that to deny relief would be to endorse this type of public administration.

[226] The first two stages of the test having been made out, the onus of satisfying the Court that the frustration of Everton’s legitimate expectation was justified now shifts to the Council.⁵⁵

[227] I first consider the level of scrutiny to be applied to the Council’s arguments in this case.

[228] Most successful arguments of substantive legitimate expectation involve decision-making at a very individual level, in which the important interests of a small class of applicants are sacrificed to financial planning or administrative convenience. This was the case in R (Rashid) v Secretary of State for the Home Department, which involved an individual asylum claim,⁵⁶and R v North and East Devon Health

⁵⁵Paponette v Attorney-General of Trinidad and Tobago, above n 38, at [37].

⁵⁶R (Rashid) v Secretary of State for the Home Department [2007] EWCA Civ 546.

Authority, ex parte Coughlan which involved the housing of a severely disabled individual.⁵⁷

[229] On the other extreme are cases involving what Randerson J called “policy choices... in the macro-political field”.⁵⁸In other words, largely financial decision- making involving the balancing of the rights of many people, or the allocation of public funds between different groups.

[230] This case lies between those two extremes. It is most similar to the facts of Hugh Green Ltd v Auckland Council.⁵⁹There, the applicant claimed a legitimate expectation that the Council would acquire two lots in a development to use as public space.

[231] Fitzgerald J acknowledged there was some level of public interest in the case, as public funds not used to purchase the lots would evidently be put to some other public use.⁶⁰But the case involved only one developer and a very small proportion of public land and funds. Fitzgerald J concluded:

[180] Standing back, had the remaining aspects of HGL’s claim of legitimate expectation been made out, this aspect of the claim would have been finely balanced. To borrow the words of the Court of Appeal in Petrocorp, the dominating consideration in the decision not to acquire Lots 800 and 801 was simply money; it was not a change in general policy affecting the public at large or a significant section of it.

[232] Fitzgerald J referred to Hugh Green Ltd as “finely balanced”. The case was far more individualised than the present case; it involved a small portion of land in one area, and affected only one developer. The present case, by contrast, potentially affects an entire neighbourhood of large developments. Allowing Everton to pay development contributions on the 2016/2017 DC Policy may mean stalling development in Rotokauri, shifting part of the burden of paying for infrastructure onto other developers, or onto ratepayers as a whole.

⁵⁷R v North and East Devon Health Authority, ex parte Coughlan [2001] QB 213 (CA).

[233] In Hugh Green Ltd, the Council had not justified its frustration of the expectation, or even explained what it would do with the funds not spent on the lots:⁶¹

No evidence was adduced, at even a summary level, of the competing acquisition opportunities said to have justified the change in approach to acquiring Lots 800 and 801.

[234] Here, by contrast, the Council has explained its decision to frustrate Everton’s expectation at length. It has canvassed alternative options and why it considered its approach to be the most appropriate.

[235] As a result, I consider this decision closer to the “macro-political” end of the spectrum of council decision-making. This means it is appropriate to give wider latitude to the Council’s reasoning. But as Randerson J pointed out:⁶²

Even so, the Court will not in those situations, forego its proper constitutional role on judicial review of ensuring that the decision maker has acted in accordance with law, fairly and reasonably.

[236] Unlike Hugh Green Ltd, this case is not finely balanced - it will inevitably involve unfairness to someone. The Council’s argument could be characterised as “simply money”, but this is missing the point – it is a decision about which of the Council’s constituents should bear the burden of paying for infrastructure. As well, the Council had to balance different principles from the LGA in coming to its decision (certainty for Everton against fair sharing of the cost of infrastructure). There is evidence that it did this including a table weighing up the relative merits of each option.

[237] There is some basis in Hong Kong and England for Everton’s argument that the Council has created this situation and excusing it would promote poor administrative practice – namely that “public bodies ought to deal straightforwardly and consistently with the public”,⁶³and that the doctrine of legitimate expectation “facilitates the task of governance that people feel able to put their faith in what their

[238] In this case, it is not good administrative practice for the Council to undermine Everton’s legitimate expectation which emerged from its practices and behaviour, but neither is it good administrative practice to upon realising a problem exists, require ratepayers or other developers to foot the bill. What decision to make about these competing interests was one for the Council to make. I am not persuaded that Everton’s submissions on this point are so compelling so as to justify the Court’s intervention.

[240] Having succeeded on its first cause of action, I now turn to consider whether I should exercise my discretion in favour of granting the application.

[242] Everton submitted that the Council’s pleadings did not advance grounds opposing the exercise of the Court’s discretion if a reviewable error was established. However, Everton’s submissions responsibly covered the points raised in the Council submissions that could be relevant to this topic. These points concern the cost of the Greenway and the purported delays associated with the various s 92 requests to do with Everton’s proposed stormwater management strategy.

⁶⁴Ng Siu Tung v The Director of Immigration [2002] HKCFA 6; (2022) 5 HKCFAR 1 (CFA) at [349].

[243] The default position is that the Court typically grants relief where a reviewable error is found.⁶⁶As counsel for Everton submitted, the discretion to refuse relief is very narrow and exceptional,⁶⁷and where an error of law has been made, the refusal to grant relief will be rare.⁶⁸

[59] Public law remedies are discretionary. In considering whether to exercise its discretion not to quash an unlawful decision or grant another remedy, the court can take into account the needs of good administration, any delay or other disentitling conduct of the claimant, the effect on third parties, the commercial community or industry, and the utility of granting a remedy.

[60] Nevertheless, there must be extremely strong reasons to decline to grant relief. For example, in Berkley v Secretary of State for the Environment [2000] UKHL 36; [2001] 2 AC 603 (HL), Lord Bingham described the discretion as being ‘very narrow’ (at p 608) whereas Lord Hoffman said cases in which relief would be declined were ‘exceptional’ (at p 616).

[245] Everton submitted that neither of the matters the Council raises are sufficiently strong reasons to depart from granting relief in these circumstances.

[246] First, in relation to the Geenway, Everton addressed the inference that could be drawn from the Council’s evidence that the Council’s decision to require development contributions under the 2018/2019 DC Policy, even if unlawful, was justified by the anticipated funding shortfall.

[247] Although I have referred to the difficult position the Council found itself in, I do not consider there was anything untoward about Everton lodging its application when it did. Indeed, the incentive to do so was, in my view, obvious and likely as it coincided with the review of the DC Policy. There is also merit in Everton’s position that the Council would have been well aware of the number of prospective applicants in the Rotokauri area likely to be impacted by its decision because pre-application meetings were typical. As well, any funding shortfall for the Greenway will only

⁶⁶Ririnui v Landcorp Farming Ltd [2016] NZSC 62; [2016] 1 NZLR 1056 at [112]. See also Auckland Council v Wendco (NZ) Ltd [2017] NZSC 113; [2017] 1 NZLR 1008 at [96]; Director of Maritime New Zealand v Survey Nelson Ltd [2011] NZSC 61 at [4] and [17]; and Air Nelson Ltd v Minister of Transport [2008] NZCA 26, [2008] NZAR 139 at [60]- [61].

⁶⁸Vipassana Foundation Charitable Trust Board v Auckland Council [2019] NZCA 100, [2019] NZRMA 380 at [95]; citing GXL Royalties Ltd v Minister of Energy [2010] NZCA 185, [2010] NZAR 518 at [67].

[248] Further, the Court in this case is only concerned with the facts as they relate to Everton’s application. It is not at all certain that a similar outcome would be justified in respect of other developers who may have received a letter similar to the one sent for Everton in July 2019. Each case depends on its own facts.

[249] I have already traversed the issues to do with the s 92 requests in the judgment and do not consider that there is anything surrounding that process that would justify declining relief.

[250] Accordingly, I find there are no circumstances justifying a decision to decline Everton the relief it seeks in relation to its first cause of action.

[253] Costs are reserved. If Everton wishes to apply for costs it is directed to file a memorandum in relation to costs within 21 days of the date of receipt of this judgment. The Council is to file any memorandum in reply no later than 21 days thereafter. Costs will be dealt with on the papers unless the Court considers upon reading the memoranda that a further hearing is required.

High Court of New Zealand Decisions

Everton Heights Limited v Hamilton City Council [2023] NZHC 40 (31 January 2023)