“No ‘wine-ing’ covenants” declined for a subdivision consent in Gibbston Valley

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“No ‘wine-ing’ covenants” declined for a subdivision consent in Gibbston Valley

“No ‘wine-ing’ covenants” declined for a subdivision consent in Gibbston Valley

Tuesday 15 June, 2021

There is an increasing trend for applicants seeking to subdivide in industrial or rural environments to offer “no complaints covenants” as conditions of their resource consent application.

“No complaints covenants” are covenants registered on the new titles within a subdivision which prevent the property owner and/or occupier from complaining about the adverse effects of established nearby activities. These covenants must be entered into with the agreement of the owners of both the covenanted property and the nearby property generating adverse effects, such as noise. Once a “no complaints covenant” is entered on the title it will bind new property owners and is very difficult to remove or change.

This type of condition can protect lawfully established activities from issues of reverse sensitivity. However, a recent decision of the Environment Court held that “no complaints covenants” are not always appropriate and declined a resource consent application on those proposed conditions.

Gibbston Vines Limited (the applicant) has been proposing to subdivide its land in the Gibbston Valley for more than two years. The proposed subdivision would have allowed one commercial use lot and six residential lots pitched at purchasers who wish to “live amongst the vines”. However, an adjacent vineyard and a number of other local residents objected to the proposal because they were concerned the future residents would not enjoy the reality of living next to working vineyards. They were also concerned that future residents would object to new resource consent applications for viticultural activities, preventing ongoing operations as well as any expansion. Queenstown Lakes District Council also declined the application on the proposed conditions.

The Court gave the applicant a rare opportunity to revise its proposal and present an amended design at a second hearing. The intent of the revision was to address adverse effects of noise on future residents and consider new lot layouts. Whilst the applicant did satisfactorily address the design effects on the Gibbston Valley landscape, in the Court’s opinion, the revised proposal did little to mitigate the adverse effects of noise from viticultural activities.

The Court found that future residents would be exposed to noise effects at all periods of the day and night, which would be significantly more adverse than living in even a typical working rural environment. It then commented that the primary issue in the matter was a “land use conflict” as the applicant was proposing a new use of the available resources in conflict with the existing uses. The applicant considered that the “no complaints covenants” would address the “land use conflict” by alerting future residents to the noise effects of “living amongst the vines”. It also considered that the “no complaints covenants” would confer deemed affected party approval to future viticultural activities requiring resource consent.

The Court disagreed and restated its first interim decision that “… taking away the capacity of those suffering noise issues to object does not take away the adverse effect that is the source of the conflict. The Court then considered the intent of the Proposed District Plan to manage conflicts between established viticultural activities and incoming residential development. As the “no complaints covenants” were inconsistent with the Proposed District Plan’s objectives and policies and also inadequate in mitigating foreseeable adverse noise effects, the Court had no option but to decline the resource consent application as it related to the residential lots.

The Court did however provide the applicant one last chance to revise its proposal so it could subdivide the commercial use lot, as there was no inconsistency identified between that use and the adjacent lawfully established activities.

As the density of residential activities continues to conflate with industrial or rural working environments it may become common for “no complaints covenants” to be registered on new titles from a subdivision. However, it may not always be appropriate to offer or grant consent on such conditions. Much will depend on the direction set out in the relevant district plan.

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