Shelly Bay development comes one step closer

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Shelly Bay development comes one step closer

Shelly Bay development comes one step closer

Tuesday 15 June, 2021

The decision by Wellington City Council (“Council”) to develop Shelly Bay, on the coast of Miramar, Wellington, has long been surrounded in controversy. Prominent opponents to the development include Sir Peter Jackson, local iwi Taranaki Whaanui, and Wellington City Mayor, Andy Foster. The main criticism by opponents has concerned how the Council has handled the process of development.

The Housing Accords and Special Housing Areas Act 2013 (“HAASHA”)

The process of seeking to develop Shelly Bay began when the Minister for Housing and Council signed a housing accord in 2014 under the HAASHA. HAASHA creates a streamlined process for obtaining resource consents in residential areas with housing supply and affordability issues. The Minister subsequently approved a number of sites within Wellington for ‘special housing areas’, including the Shelly Bay site. The Council, which owns the site, has agreed to sell a portion of it to Wellington Company Limited (“Company”), a developer, and to lease another portion to the Company for a 125-year term for residential purposes.

The first judicial review - resource consent quashed

When Council granted resource consent to the Company in 2018, Enterprise Miramar, a society representing members of the business community with the object of promoting and fostering the welfare of Miramar, succeeded in having the consent quashed.[1] The key reason the Court of Appeal found that the consent could not stand related to how the Council had treated the interplay between the HAASHA and the Resource Management Act 1991 (“RMA”).

The key provision for considering a resource consent under HAASHA is section 34. Under this section, Council must take into account a number of relevant considerations (s 34(1)). One of these considerations is certain sections of the RMA. In granting the first consent, Council failed to give adequate consideration to those sections of the RMA. Instead of treating the purpose of the HAASHA as the most important and influential matter to be weighed in comparison to other factors, Council used the purpose to eliminate or greatly reduce its consideration and weighing of the other factors, including the RMA sections. Council did not give any substantive consideration to the principles and purpose of the RMA (Part 2), as it should have done.

The Court of Appeal suggested the Council consider using a panel of commissioners to re-make its decision. In November 2020, a panel of three independent commissioners (“Panel”) granted resource consent to the Company. Enterprise Miramar again challenged the decision by way of a judicial review.[2]

The second judicial review – resource consent stands

This time, when assessing the s 34(1) considerations, the Panel had considered the RMA sections. Nevertheless, Enterprise Miramar argued that the Panel’s decision to conclude that the traffic effects of the new development would be ‘no more than minor’ was either an error of law or unreasonable; if the assessment of the traffic effects had occurred under the RMA, it could not be found that the effects were no more than minor. The High Court agreed that this would have been the conclusion under the RMA, which provided for a more rigorous test. However, the Court found that the HAASHA’s requirement of ‘taking into account’ a section of the RMA did not equate to having to meet the test in the RMA. As the Panel only had to take into account how the traffic effects would be assessed under the RMA, it was not fatal to the assessment under HAASHA that the traffic effects would not meet RMA test. What was important was that the Panel could demonstrate that it had considered and weighed all the factors in s 34(1).

Enterprise Miramar also made a number of other, technical, challenges, for example that the Panel asked whether roading infrastructure could be supported rather than using the correct terminology of would be supported. The Court rejected these challenges.

Substance over form

The case is a good reminder that, in judicial review, substance tends to matter over form. The first judicial review turned on a point of substance (whether the Council had given the proper consideration to the RMA). Once the decision was re-taken on the proper substantive basis, the highly technical challenges made by the claimant failed to move the Court.

Repeal of HAASHA

We note that the provisions of HAASHA to commence the process of establishing a special housing area were repealed on 16 September 2019, as required by HAASHA when it was enacted. This means no more special housing area processes could start from that date onwards. On 16 September 2021 HAASHA will be repealed in its entirety (pursuant to s 3).

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