Case Review: Gray v Dunedin City Council, Balmoral Developments (Outram) Limited v Dunedin City Council and the National Policy Statement for Highly Productive Land. By Mike Doesburg, partner at Wynn Williams, specialising in resource management and environmental law.
The incremental loss of highly productive land is an important environmental issue. At its simplest, if growing towns and cities are allowed to devour the surrounding countryside unchecked, we may lose the land we need to grow our food. While this is far from a new realisation, management of land has remained inconsistent and highly productive land has continued to be lost.
In 2022, the Government promulgated the National Policy Statement for Highly Productive Land (NPS-HPL), with the overarching objective to protect highly productive land for use by land-based primary production.
The NPS-HPL came into effect on 17 October 2022 and directs how councils are to identify and map such land, and how councils are to manage the subdivision, use and development of that land.
With limited exceptions, the NPS-HPL directs that councils must set planning rules that avoid the subdivision and development of highly productive land. By 2025 councils must have identified and mapped highly productive land with objectives and policies, and rules must be included in district plans within two years of mapping.
The NPS-HPL also provides an interim regime, whereby councils must apply the NPS-HPL to any general rural or rural production land that is Land Use Capability Class 1, 2 or 3 (under the New Zealand Land Resource Inventory mapping or other more detailed LUC mapping). Exceptions exist for land identified for future urban development or that are subject to a council-initiated plan change to rezone the land.
Two recent cases clearly demonstrate that protecting New Zealand’s food bowl is not a simple task.
Gray v Dunedin City Council  NZEnvC 45
The case involved an appeal against a decision to decline resource consent for a residential activity in the Rural – Taieri-Plain zone of the Second Generation Dunedin City District Plan (2GP).
A key focus of the appeal was an exception to the 2GP’s minimum site size requirements, which applies where a proposal will make a significant contribution to the enhancement or protection of biodiversity values.
The decision is notable for its analysis of how the NPS-HPL applies to resource consenting in the interim before mapping and provisions are introduced. The decision engaged with clause 3.9 of the NPS-HPL, which requires territorial authorities to avoid the inappropriate use or development of highly productive land that is not land-based primary production.
The Court observed that, in the interim, clause 3.9 is difficult to apply in a consenting context. This is primarily because parts of clause 3.9 are dependent on decisions yet to be made by councils as they amend their planning rulebooks in response to the NPS-HPL.
The Court proceeded on the basis that the NPS-HPL provisions are among the wide range of identified matters that a consent authority must have regard to when assessing a resource consent application. The Court therefore concluded the proposal was not “inappropriate” in terms of clause 3.9 of the NPS-HPL.
The court also made findings in relation to the recently issued Guidance Notes on the NPS-HPL, published by the Ministry for the Environment. Among other things, the Guidance Notes provide examples of inappropriate activities for purposes of clause 3.9 above.
The Court was not prepared to give any weight to the discussion of the NPS-HPL in the Guidance Notes – referring to what it said was the High Court’s observation on the relevance of similar guidance notes in the context of the NZCPS 2010.
In Opoutere Ratepayers and Residents Association v Waikato Regional Council  NZEnvC 105, the Environment Court found (at ) that guidance notes are not binding nor determinative when interpreting National Environmental Standards.
This position has also been reflected in subsequent decisions of the Environment Court, including in Federated Farmers of New Zealand v Northland Regional Council  NZEnvC 016 and by the High Court in relation to “factsheets” published by MfE on the National Environmental Standards for Freshwater in Minister of Conservation v Mangawhai Harbour Restoration Society Inc  NZHC 3113.
The court’s approach to the NPS-HPL is reflective of the difficulty applying its restrictions before it has been given effect to.
However, applying the NPS-HPL as one consideration among many is an appropriate approach in resource consenting, where decision makers must “have regard to” national policy statements, as well as other statutory planning and policy documents.
The Court’s finding that guidance notes should be given no weight when interpreting and applying statutory instruments is consistent with previous Environment Court and High Court authority. This uniform line of case law calls into question the utility of guidance notes and factsheets prepared by the Ministry for the Environment.
Perhaps more effort should be spent making documents clearer and more certain, rather than relying on ex post facto guidance to assist with implementation.
Balmoral Developments (Outram) Ltd v Dunedin City Council  NZEnvC 59
This case was a preliminary decision on the application of the NPS-HPL to appeals against the 2GP seeking rezoning of rural land.
The 2GP was notified in September 2015, decisions were released in November 2018 and appeals filed in December 2019. For a number of reasons, the relevant appeals were not brought to hearing before the NPS-HPL took effect in October 2022. The Court was tasked with determining whether or not the NPS-HPL applied to the appeals.
It was common ground that the land sought to be rezoned was highly productive under the NPS-HPL’s interim regime. The case turned on whether an exception applied on the basis that the land was subject to a “council initiated, or an adopted, notified plan change to rezone it [to urban or rural lifestyle zone]”.
The appellants essentially argued that rezoning was sought through submissions and appeals on a council initiated notified plan change and that the exception should apply.
The Court concluded that the exception is narrow in scope and only applies where the plan change is council initiated and the council proposes an urban or rural lifestyle rezoning. The Court found that the exception did not apply and accordingly the NPS-HPL applied and would be relevant when the appeals are substantively determined.
Fairness and timing
Among other arguments, the appellants raised issues of fairness and argued the Minister for the Environment could not have intended to “deliberately torpedo rezoning submissions” on appeal processes commenced long before the NPS-HPL.
The Court concluded that nothing was “torpedoed”, as the appeals could still be brought, with the NPS-HPL as a relevant consideration.
The appellants are unlikely to take any comfort from the suggestion the NPS-HPL is merely a relevant consideration – the goalposts have moved and the appeals will now be measured against a requirement to “give effect to” directive policies in the NPS-HPL that require that subdivision and development be avoided.
The decision is another example of the difficulty that new or changed National Policy Statements create for ongoing planning processes. Unless bespoke transitional provisions are provided (either in each National Policy Statement or the RMA), national direction like the NPS-HPL will continue to create uncertainty and delay in planning processes.
Although they are two early cases and focused on narrow issues, these cases demonstrate the challenge that councils, landowners and submitters face in implementing new national direction like the NPS-HPL.
Under the coming RMA reform, the importance of national direction will increase – it is essential that those affected by resource management decisions participate in the formation of the new “national planning framework”.
Such participation may not be far away – we are expecting the first national planning framework to be notified very quickly after the new legislation passes, potentially as early as August 2023. LG