Deserving exceptions in the fast-track context

The Court of Appeal has recently issued a judgment arising from an appeal from the High Court dismissing an appeal and judicial review challenge to a decision of an Expert Consenting Panel (Panel) under the COVID-19 Recovery (Fast-track Consenting Act 2020) (Act). The Court of Appeal's judgment, allowing the appeal, is of particular interest as it is a recent application of the Supreme Court's “deserving exceptions” approach to directive plan provisions articulated in Royal Forest and Bird Protection Society of New Zealand Inc v New Zealand Transport Agency (East West Link – our previous Insights article addressing this judgment can be viewed here).¹

As noted by Justice Glazebrook in her dissenting judgment in East West Link, the majority's judgment provided little guidance as to how a deserving exception to avoidance policies might operate in other regions and other contexts. The Court of Appeal's judgment now provides an example.

By way of background, the Panel declined Glenpanel's application for resource consent permitting a medium-density housing development in an area between Shotover River and Lake Hayes in the Queenstown District know as Ladies Mile. The application was a non-complying activity overall under the Proposed District Plan, involving urban development on land outside the “urban growth boundary” and on land within an “outstanding natural feature”. Relevantly, the Panel found that the project was contrary to a set of objectives and policies in the Proposed District Plan. The Panel noted several provisions in the Proposed District Plan that referred to “avoidance” of urban development outside urban growth boundaries on rural land, the need to “ensure” that urban development was in defined growth areas, and the need to “protect” outstanding natural features. The Panel concluded that the directive Proposed District Plan provisions it identified dictated the result, and did not permit the application to be granted.

Glenpanel's arguments that focused on the Panel's finding that the application was contrary to the objectives and policies of the Proposed District Plan, in terms of s 104(1)(b) of the Resource Management Act 1991 (RMA), were unsuccessful in the context of its appeal to the High Court. In the High Court, Glenpanel argued that the Panel's approach was overly rigid and did not involve a fair reading of the objectives and policies of the Proposed District Plan as a whole. The High Court did not accept Glenpanel's criticisms of the Panel's approach, and concluded that the Panel's analysis was thoughtful and the conclusions it reached were open to it. The High Court's judgment was however not informed by the Supreme Court's judgment in East West Link.

The Court of Appeal noted that East West Link identifies “a more nuanced approach” to the application of the s 104D(1)(b) gateway. The Court of Appeal accepted that this approach affected the appropriate assessment of Glenpanel's application in two ways.

• First, the Court of Appeal held that a more nuanced approach was required when assessing the application, given what the Court described as the “substantive nature of the wider planning instruments”, referring to non-statutory plans that had identified Ladies Mile as a priority future urban development area, a proposed variation to the Proposed District Plan to extend the urban growth boundary to include Ladies Mile, and provisions of the National Policy Statement on Urban Development 2020 (NPS-UD) that relate to providing more land supply for housing.
• Second, the Court of Appeal held that the Act itself had an influence on both the interpretation and application of the District Plan provisions, considering the fast-track regime under the Act “encompasses bringing forward projects that would otherwise likely be granted under the RMA in the future.”

Bringing this analysis together the Court of Appeal stated:

It is the combined effect of the approach in East West Link and the policy of the Act that is most significant in this case. The fact that this area had been identified as a likely location for future urbanisation in response to the NPS-UD, and the fact that the Act promotes the fast tracking of projects, means that the Panel should have considered whether granting the application facilitated the purposes of the Act, the objectives of the NPS-UD, and the objectives identified in the other instruments, whilst at the same time promoting sustainable management in the manner contemplated by the Proposed District Plan.

The Court of Appeal expressly noted that the more nuanced approach does not dictate the outcome, and under the more nuanced approach uncertainties connected with where and how urban development would occur would need to be taken into account.

The Court of Appeal noted that it was not surprising that neither the Panel nor the High Court had adopted the more nuanced approach given the Supreme Court's judgment in East West Link was released after the decisions of the Panel and the High Court.

Ultimately, the Court of Appeal allowed the appeal and directed the Panel to reconsider Glenpanel's application in light of its judgment.

The Court of Appeal's judgment is an interesting application of the Supreme Court's “deserving exceptions” approach in a different context. The reliance placed by the Court of Appeal on what it described as the “substantive nature” of wider planning instruments is potentially significant, building on the reasoning of the Supreme Court in East West Link in a different planning context that includes the NPS-UD. However, it remains to be seen whether the Court of Appeal's judgment has wider implications beyond the immediate context of the Act, noting the influence that the Act had on the Court of Appeal's reasoning.

It is also worth highlighting that the planning context relevant to the Panel's reconsideration of Glenpanel's application has changed subsequent to the Panel's original decision, with provisions relating to medium and high-density housing in the Ladies Mile area now operative. These provisions may have a substantive impact on the Panel's reconsideration of the application. The case therefore also highlights the strategic advantage a dissatisfied applicant can gain through appeal procedures under the Act, noting existing applications, including appeals, remain in effect notwithstanding the repeal of the Act.

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¹ Royal Forest and Bird Protection Society of New Zealand Inc v New Zealand Transport Agency [2024] NZSC 26, [2024] 1 NZLR 241.