uagc neil construction v nscc

8/20/2019 UAGC Neil Construction v NSCC

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c

IN THE HIGH COURT OF NEW ZEALAND

AUCKLAND REGISTRY

IN THE MATTER

BETWEEN

J

AND

AND

Dates of Hearing:

Counsel:

Judgment:

M.9901473-CO, M9901474X0, M.9901475-CO.,

M.9901476~CO., M.9901867~CO., M.9901868-CO.,

M.19-SDOO, M.20-SDOO., M.107-SDOO., M.lOS-SDOO.

of the Rating Valuations Rules 1998

NEIL CONSTRUCTION LTD

WEITI VIEWS LTD

ELAN PROPERTIES LTD

A G DRYDEN LTD

CABRA HOLDINGS LTD

UNIVERSAL HOMES LTD and

FLETCHER HOMES LTD

Plaintiffs

NORTH SHORE CITY COUNCIL

RODNEY DISTRICT COUNCIL and

WAITAKERE CITY COUNCIL

First Defendants

THE VALUER-GENERAL

Second Defendant

28 August 2000 - 1 September 2000

4,5 and 6 October 2000

R Asher QC, A Brown and R Bartlett for all Plaintiffs

A Galbraith QC and G Palmer for North Shore City Council and

Rodney District Council

K Berman and S Manalo for Waitakere City Council

H S Hancock and E Fitzgerald for Valuer-General

November 20Q0

RESERVED JUDGMENT OF MORRIS J AND I.W. LYALL

Solicitors:

Ellis Gould, DX CP22003, Auckland for Plaintiffs

Simpson Grierson, DX CX10092 Auckland, for Defendants except Waitakere City

Kensington Swan, DX CP2200 1 Auckland for Waitakere City

Crown Law Office, DX SP20208 Wellington for Valuer-General

Counsel Appearing:

R Asher QC., P 0 Box 4338 Auckland

A R Galbraith QC, P 0 Box 4338 Auckland


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Introduction

111

The plaintiffs are the owners of unsold subdivided land in North Shore City,

Waitakere City and Rodney District. On 1 July 1998 the Rating Valuation Act 1998

(RVA) came into force. It repealed the Valuation of Land Act 1951 (VLA). Under

the RVA, Local Authorities are now responsible for the preparing and maintaining of

District Valtations Rolls. These Rolls are the basis for the striking of rates in each

Territorial District. The Local Authority is also the Body responsible for the striking

of rates in its District and the recipient of these rates. Under the VLA the Valuer

General was responsible for the preparing and maintaining of the Valuation Roll and

of making any necessary valuations. Under the RVA the Valuer General has become

the auditor of valuation practice and is empowered by the Act to make rules

governing various aspects of this practice. Pursuant to the Act he made the Rating

Valuations Rules (RVR) on 3 1 July 1998.

PI

Under the VLA and up until early 1999 unsold subdivided land comprising

multiple certificates of title held by the one owner was valued as one landholding in

a single assessment.

In accordance with the then accepted valuation practice a block

discount factor was applied to the aggregate value of the individual lots to assess the

market value of the owner’s interest in the land. As a consequence of the single

valuation assessment a single rates assessment was then issued by the appropriate

Council for the land block. Further, because the developers’ landholding was entered

in the Roll as one separate property, only one set of Uniform Annual Charge “UAC”

were charged on the land. On the sale of any lot/lots to a third party the land value

for the remaining land held (in block) was then adjusted to take account of the sale.

PI

During 1998 the defendant Councils, and we understand others, considered

and then decided each unsold separately titled lot in a subdivision would be

individually valued and an assessment issued for each titled lot. The valuations were

carried out. No block discount was allowed, each titled lot being valued

individually. The Council’s Valuation Rolls were amended. In 1999 separate

assessments were issued with the consequent assessment of rates.


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PI

The plaintiffs objected to the assessments. Their objections have been

transferred by the Land Valuation Court for determination by this Court. By

consent, proceedings issued by the plaintiffs seeking various declarations from this

Court under its general jurisdiction have been heard in conjunction with the

objection hearing. A separate judgment covers these issues; the factual position is

identical in both lots of proceedings.

PI

The plaintiffs contend:-

*

[al

The issue of individual valuation assessments in 1999 for each

separately titled lot, thereby resulting in separate entries in the District

Valuation Roll for each such lot, was unreasonable in all the

circumstances. Each area of subdivided land should have been

assessed as one block holding.

PI

The Councils had no power to alter the Roll in the manner they did.

[cl

The value ascribed to each lot has been assessed incorrectly and, in

particular, has failed to take into account a block discount factor.

VI

A separate assessment for a lot in a subdivision cannot be generated

until a certificate of title for such lot has been issued. Assessments

cannot be based upon lots which appear on a plan deposited with

Land Information New Zealand “LINZ” but in respect of which no

certificate of title has been issued.

El

A consideration of these issues have involved a consideration of the Rating

Valuation Rules issued by the Valuer General which the plaintiffs contend are ultra

vires his powers.

[71

The Councils contend:

[al

The issue of the individual assessments was valid pursuant to s.7(2)

of the RVA. No issue of reasonableness arises.


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PI

[cl

WI

4

The alterations to the Roll were validly made. They rely particularly

on s.14 of the RVA and Rule 4.1 of the Valuation Rules.

The values were reached in accordance with practice, no discount is

appropriate or required. We should not interfere with them.

Once a plan is deposited, although no certificate of title is issued,

individual assessments may be issued for properties which can be

l

separately identified.

PI

The Valuer General broadly adopts the submissions of the Councils. He

submits that in a residential subdivision each separate lot which has its own

individual certificate of title is for rating valuation purposes a separate property.

The

owner’s interest in each separate residential section and its certificate of title should

be individually valued. He does not however agree the mere inclusion of a lot on a

subdivisional deposited plan is sufficient to have the lot entered on the District

Valuation Roll as separate property.

Background

PI

The plaintiffs are urban land developers and/or house building companies.

They are the owners of the subdivisions which are the subject of these proceedings.

The 1999 change in the valuation process has brought about a marked increase in the

rates payable by them on unsold sections held by them. In most cases the land

involved is vacant land, unoccupied and with no amenities built on it. In the case of

housing companies as opposed to pure land developers, in some case a ‘spec’ house

has been constructed on a site before its sale as a housing package to the purchaser.

In most cases the sites when purchased were in rural areas adjoining urban

boundaries. Having purchased the land the developer proceeded through the

resource consent procedure and developed the land for subdivision.

Financial

contributions have been made to Councils and roads formed. In every case the

developer has constructed the wastewater, water sewerage and other works necessary

to connect the ultimate users of the property to the existing Council infrastructure.


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Although any costs incurred are built into the price of lots, the sale process may

extend over years.

[lo] The proceedings which involve Rodney District Council are the proceedings

by Weiti Views Limited, Elan Properties Limited, A G Dryden Limited and Cabra

Holdings Limited. These proceedings by Weiti Views Limited and Elan Properties

Limited relate to the Weiti Views and Manly Estate Subdivisions at Whangaparaoa

which are undertakings by a joint venture between Hopper Developments Limited

and members of the Boocock family who also operate Cabra Holdings Limited and

Mr J.D. Hamilton. In both cases as part of the general revaluation in the Rodney

District as at 1 September 1998 a single Notice of General Revaluation was issued

for each subdivision. In February 1999 the Rodney Council issued new separate

assessments for each separately titled lot in these subdivisions.

The evidence

establishes no further subdivision, that is subdivision of the land by the issue of new

certificates of titles, occurred following the General Revaluation and before Rodney

issued the separate assessments in February 1999. Stages in the subdivisions have a

projected sale bound period of up to 8 years.

[l l] The A G Dryden proceedings relate to a subdivision called Omaha Point and

is located on the Hibiscus Coast. In September 1998 the subdivision, including

issues of titles, had been completed and the holding was valued in a single

assessment. In May 1999 separate re-assessments were issued for each separately

titled lot. Part of this subdivided land is not being currently marketed.

[ 121 The Cabra Holdings proceedings relate to a subdivision on the Hibiscus

Coast known as The Grange. Separate value assessments were issued by the Council

after the land had been subdivided as part of the process of vesting land for public

works.

[13] The proceedings which involve North Shore are brought by Neil

Construction Limited and concern two subdivisions known as Glenvar Heights and

Unsworth Heights. In both cases the subdivisions have been valued in a series of

single assessments following the subdivision of the land by the latest stage of


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subdivision. The subdivision had previously been assessed in block on 1 September

1996 being the previous revaluation date in the North Shore District.

[14] The proceedings against Waitakere are brought by Universal Homes Limited

and Fletcher Homes Limited. They involve subdivisions at Woodbury Park in New

Lynn, and Braeburn at Henderson. In both cases the partially subdivided land was

valued as a single block assessment as part of the 1998 general revaluation. During

the course of 1999 individual assessments were issued for each unsold separately

titled lot, bath of previously subdivided land as well as land which had previously

been assessed without taking into account the issue of title.

[15] In all cases the plaintiffs have given evidence of the impact of the new

practice resulting in an increase in both the value based rates and uniform annual

charges. The increases are significant and clearly of concern to the plaintiffs. They

accept if the subdivided land could be sold, the effect of the change in method may

be minimal but their evidence establishes much of the subdivided land will continue

to be held for prolonged periods of time during which it will remain vacant and

unused, receiving no benefit from the Council services and placing little, if any,

demand on the infrastructure.

[ 161 Small wonder the plaintiffs have taken steps to minimise the impact of the

new practice. New certificates of title are issued only on application by or with the

consent of the registered proprietor of land. A plan of subdivision may therefore be

deposited with LINZ for approval as to survey, but no request made for the issue of

titles in the subdivision shown on the plan. At Stage 4A of its Grange subdivision

Cabra Holdings Limited requested 29 separate certificates of title. The remaining

lots on the relevant deposited plan were held in one certificate of title. Neil

Construction, at its Lincoln Park subdivision, drew down individual lots in batches

or one by one as lots were sold, the remaining lots dn the deposited plan continuing

to be held under the original head title. Notwithstanding, no titles have been issued

for each separate lot on the deposited plan of the subdivisions with LINZ, Rodney, in

the case of Cabra Holdings, and Waitakere, in the case of Neil Construction, have

issued separate valuation assessments in respect of each separate lot as shown on the

plan.


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The Individual Assessment Issue

[ 171 Section 7 of the RVA provides:

7 TERRITORIAL AUTHORITIES TO PREPARE AND

MAINTAIN DISTRICT VALUATION ROLLS--

(1)

Each territorial authority must prepare and maintain a district

valuation roll for its own district in accordance with rules made under

this Act.

(2) *

Each roll must contain such information in respect of each

separate property within the district as is required by the rules,

whether or not that information relates to the method of rating

adopted at the time by the territorial authority.

(3)

Where the boundaries of the district of a territorial authority

are altered, or a new district is constituted, the relevant territorial

authorities must prepare such new rolls or make such alterations in

existing rolls as may be necessary to give effect to the provisions of

this Act.

(4)

For the purposes of this section any land that is capable of

separate occupation may, if in the circumstances of the case it is

reasonable to do so, and in accordance with any rules made under this

Act, be treated as separate property whether or not it is separately

occupied.

[18] Its precursor was s.7 of the Valuation of Land Act 1925 which was re-

enacted as s.8 of the Valuation of Land Act 1951 (VLA). Section 7(4) of the RVA

first appeared as s.8(2) of the VLA. The Valuer General has told us this subsection

was added in 1981 to make it clear ownership of flats were able to be valued

separately in the Roll.

[19] Section 7 of the 1925 Act was considered in Walters v Supreme Court

Registrar andManukau City [1936] NZLR 546. Concerning the correct meaning of

the phrase “each separate property” Ostler J said at p 550:

As to the meaning of the term, I agree with the learned Judge in the

Court below that in the absence of a statutory definition the words

must be construed in their popular sense. I should construe the words

“each separate property” as each separate “continuous area of land

occupied and used as one holding”.


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[20] In Valuer General v Arfrd Kahn Fumify Trust (1990) LVC 867 the Court

said at p 870:

What we think is essential in the preparation of the district roll is, first

of all, to identiQ the separate properties.

That phrase is not defined but it must be the case that separate

occupation is one aspect of that. Subsection (2) necessarily implies

that separate occupation and the capability of separate occupation are

two of the ways in which the separate property can be identified.

Other.matters which the appellant submits, we think correctly, to be

among criteria for that identification include separate ownership,

different or distinct land tenure, separate land use and the availability

of separate title.

[2 13 In Attorney General v Rodney District Council & Ors (CA) 3 1’ July 2000,

CA 274/99 Keith J said, at para 24:

The ordinary meaning of “separate property” in that context would be

the distinct pieces of land identified as such through the land transfer

system and in particular by the relevant certificate of title.

And in para 57:

In our opinion the expression “separate property” in s.8(1) of the

VLA meant a property as defined by certificate of title. That follows

from the plain meaning of the words in their particular statutory

context and from their wider land law context and the valuation

purpose of the expression.

Of major importance in support of that conclusion are the many indications in the

WA that a “separate property can have more than one occupier, use or user”.

[22] It is now settled therefore, in all cases where a certificate of title is issued for

a lot in a subdivision, such lot/land is a separate property for the purposes of s.7(2)

and must appear as such in the Roll with the consequential liability for payment of

rates.

[23] The Rodney District Council Court of Appeal judgment was delivered while

these proceedings were being heard. Originally Mr Asher had submitted that the

appropriate basis for assessing and treating unsold subdivided land in the District


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Valuation Roll pursuant to s.7 of the RVA was in a single assessment of the

developers landholding in each subdivision applying the historical block deduction

applicable for block assessments. He now accepts, as we understand it and we think

rightly so, where a title has been issued for a lot in a subdivision it is a separate

property within the neaning of s.7. He submits however, in such a situation the

Territorial Authority has an overall discretion as to whether to so assess such

property as a separate property. We do not agree. In our judgment once a property

falls within the legal definition of separate property it must be considered as a

separate prop&-ty and entered as such in the District Valuation Roll.

[24] Mr Asher further submits notwithstanding a property falls within s.7(2), the

Council is required by virtue of s.7(4) to consider whether it is reasonable in the

circumstances of each case to so treat it as separate property. And the Council

should in an appropriate case not do so.

He submitted under s.7(4) the controlling

and overriding requirement for land capable of separate occupation to be treated as

separate property is one of reasonableness and he submitted where land is not in fact

occupied by different legal persons there is an obligation under s.7(4) for a

Territorial Authority to exercise this discretion and in fact considers whether it is

reasonable to do so. He advanced in considerable detail a number of grounds which

in the circumstances of each case are required to be taken into account by the

Council. In view of the decision we have reached and set out below on this point,

we do not find it necessary to cover these matters in this judgment.

[25] We are of the clear view s.7(4) was introduced to catch property which might

otherwise fall through the s.7(2) net. It was not introduced to allow a property

caught by s.7(2) to escape the consequences of such subsection.

Section 7(4)

empowers a Council to treat land which does not fall within s.7(2) as if it were

separate property. It is a deeming section.

It potentially extends the category of

separate property. It does not potentially reduce it.

[26] Mr Asher has referred us to passages in the Rodney District Council

judgment which he submits supports his contention. At paragraph 55 the Court said:

Counsel for the appellants questioned whether this provision [s.8(2)

V.L.A.] could be used in respect of a single separate property - that is


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in a disaggregating way, as well as in an aggregating way which

counsel agreed was available.

On its face the subsection is not

limited in that sense. Many provisions of the legislation contemplate

the separate occupation of a part of a separate property. And the

related amendment made in the same amending statute in 1981 to

s.24D(6) appears to be capable of operating only in that disaggregated

way in the context of that provision.

He referred also to paragraph 58 where the Court said:

We should add that it was possible for land to be treated under s.8(2),

as a separate property if that was reasonable in the circumstances.

Because of the relatively abstract way in which this case has

proceeded however we, like Fisher J, have no basis for questioning

the decisions, if any, which the Valuer-General made under that

provision relating to the particular properties in issue in this case.

[27] These parts of the Court’s judgment must be read in the context of the real

issue before the Court which was interpretation of the words “each separate

property” and arising in the factual situation established by the evidence before it.

There is nothing in the passages to indicate the Court had the benefit of full

submissions as we have had on the interpretation of s.7(2).

[28] We are, therefore, of the view that Councils correctly assessed the individual

lots where tit les were issued as separate property under s.7(2) of the RVA. They

were not required, having determined the lots were separate property, to consider the

reasonableness of their decision under ss (4) or otherwise. They in fact did not.

Reasonableness did not enter into their considerations.

[29] It is convenient at this stage to deal with the position of assessments which

have been issued for lots depicted on a’ deposited land in respect of which no

separate and individual certificate of title is issued. The contention for the plaintiffs

supported by the Valuer General, is the absence of a separate issued certificate of

title means that there is no separate property for the purpose of s.7 of the RVA.

The

Councils submit the absence of an issued separate of certificate of title makes no

difference and the properties are stil l separate properties in terms of s.7(2) of the

RVA or, alternatively, can properly be treated as separate properties in terms of

s.7(4). They submit each lot is legally defined by reference to a lot number and


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deposited plan, is identifiable by survey as shown on the plan and the lots may be

separately sold, mortgaged, leased or caveated.

[30] In this country the process of land subdivision is governed by the Resource

Management Act 1991 (RMA) and the Land Transfer Act 1952 (LTA). The RMA

defines

“subdivision of land”

and governs the process relating to the issue of

resource consent by Council and the completion of the work and conditions

approved in such consent. The provisions of the LTA then govern the deposit of a

survey plan of subdivision with Land Information New Zealand (LINZ) and the legal

division of such land by the issue of a new certificate of title to replace the previous

title.

[3 l] For the plaintiffs it is submitted the effect of the provisions in the RMA and

LTA is that a subdivision of land is not completed until application for title has been

made. No “separate property” can be identified for purposes of s.7. Such is not the

position in our view. The evidence establishes once a plan has been deposited the

issue of title is purely an administrative step requiring nothing more than the

signature of the registered owner, their agent or their solicitor. All the District Land

Registrar must be satisfied of is that the plan has been deposited. The evidence also

establishes the absence of a separate certificate of title for a particular lot on the

deposit of a survey plan is no impediment to dealing with such lot as a separate

property. Specifically, dealings may be registered in respect of an individual lot and

a transfer, lease or mortgage can be registered. Mr Chapman has confirmed the issue

of a title has not proved a pre-requisite of such registration. We are satisfied from

the evidence once a plan has been deposited each lot thereon is clearly identifiable as

being separate and distinct from every other lot on the plan. From a practical point

of view all the certificate of title does by way of description of the property is to

record by reference to the deposited plan the area, the lot number and deposited plan

number together with the boundary measurement dimensions, what is shown on the

deposited plan. In our judgment separateness for the purpose of s.7 arises when the

plan has been deposited and before the title is issued. This is consistent with the

decision in Valuer General v Alfred Kohn Family Trust (Supra) where it was

recognised the availability of a separate title rather than the existence of a separate

title was the relevant issue. It accords also with the decision in Walters (Supra).


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Under the RVA identification of property is the issue, not the nature of ownership.

While we understand the Valuer General’s desire to have consistency and therefore

ease of management, the statute has not seen fit to make the issue of a title - the

ultimate test (compare Australian legislation). No doubt this has been done for good

reason as the circumstances under which a property can be regarded as a separate

property will vary considerably.

[32] Mr Asher submitted to conclude the property becomes a separate property

before a title has been issued would be contrary to all existing authority and in

particular the Court of Appeal decision in the Rodney District Council case. We do

not agree. The Rodney case did not deal with the situation we are faced with here. It

was concerned with the contention occupancy was sufficient criteria of a separate

property itself and a means of defining the property. The Court preferred the

certificate of title test. In our view an individual lot described on a deposited plan

fulfils the criteria of definition as required by s.7(2).

[33] We therefore reject this objection.

Alteration of the Rolls

[34] Section 14 of the RVA provides as follows:

14

ALTERATIONS DURING CURRENCY OF ROLLS--

(1)

A territorial authority may at any time, of its own motion or

on the application of the owner or occupier of land appearing on the

roll, make alterations to its current district valuation roll in order to

readjust and correct valuations and entries and bring them up to date -

(a)

In the manner and circumstances specified in rules made

under this Act; and

Co>

In accordance with any procedure specified in the rules.

(2)

Any change in the valuation of a property under this section--

@>

Must preserve uniformity with existing roll values of

comparable parcels of land; and


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w

Must be notified to the affected owner or occupier under

section 17, and is subject to objection under section 32.

(3)

A territorial authority that alters its district valuation roll under

subsection (I) must as soon as is reasonably practicable notify that

alteration to all other local authorities that use the roll for rating

purposes.

Rule 4.1 of the Rules sets out the circumstances as follows:

4.1 ALTERATIONS DURING THE CURRENCY OF THE

DISTRICT VALUATION ROLL

The District Valuation Roll may only be altered as result of one or

more of the following:

l

any improvements being added to or removed from the land; or

l any change in the ownership or occupancy of the land; or

l any new valuation made in accordance with section 16 of the Act; or

l any land being omitted from the roll, or any errors in the roll; or

l any subdivision, amalgamation or resurvey of the land; or

l any change in the provision of an operative district plan; or

l

any extraordinary event affecting property values; or

l any change of use or changes of a minor or clerical nature which do

not change the values.

[35]

In all cases which are the subject of these proceedings the first individual

assessments for each lot were issued between General Revaluations in all three

Territorial Districts. In the case of Rodney and Waitakere the first new assessments

issued between 4 and 7 months after certificates of the General Revaluation.

In the

case of North Shore the first new assessment was issued in the’ last year of the

current 3-year roll period.

[36] The factual circumstances of each subdivision and which we have referred to

earlier appear to form three separate groupings:

In the case of the individual assessments issued to Weiti Views

Limited, Elan Properties Limited and Neil Construction Limited the


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subdivided land had previously been valued

in

single block

assessments and there was no further subdivision of the land before

the issue of the amended assessments in February and March 1999.

PI

The Dryden subdivision at Omaha Point and the Fletcher subdivision

at Braeburn and the Universal subdivision at Woodbury Park were

each previously valued as partly subdivided land in single block

assessments in the 1998 General Revaluations of Rodney and

l Waitakere. Some further subdivision then occurred within that land

requiring the Council to alter the land value in the Roll entry when

titles on a new stage of subdivision had issued in order to bring the

Roll entries up to date. Individual assessments for all the unsold lots

were issued in May and June 1999.

[cl

In the case of Cabra Holdings Limited following the 1998 General

Revaluation certified in October 1998, new Notices of Valuation

assessing each individual titled lot were issued in May and June 1999.

No further subdivision of the land had occurred at that time.

Subsequently one of the undeveloped titles was further revalued as 6

titles as part of the exercise of transferring land for roading and

reserve purposes. The lots required further subdivision and

development before sale as part of the subdivision. Some alteration

of value was required at that time.

[37] The plaintiffs contend that in the subdivisions referred to in 36[a] above there

was no applicable ground under s. 14 and Rule 4.1 for altering the Roll by issuing the

new individual valuations. In the subdivision referred to in 36[b] and [cl, while

some further act of subdivision occurred giving the Council grounds to alter the land

value to take into account the issue of title in the new area of development, the

principle of comparabilities set out in s.14(2) in Rule 4.1 required such alterations

during the relevant Roll period should have been carried out on the basis of a single

assessment of the total land holding consistently with the single block assessments of

subdivided land which had been carried out during the General Revaluation of the

District.


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[38]

The Councils contend the valuations of subdivided land in the Districts

carried out for many years previously were errors or omissions in the Roll which the

Councils were required to remedy in order to comply with either what the Councils

had previously said were the requirements in Rule 3.6 of the Rules or what they now

say are the requirements of s.7(2) of the RVA.

[39]

Mr Asher submits the amending provisions envisage alterations for minor

errors or omissions, the correction of slips and the alterations resulting from a

successful objection. He cites

New Zealand Land Development Co Ltd v Valuer-

General [1986] 2 NZLR 362 where the Court of Appeal considered the statutory

scheme in the VLA and in particular the considerations governing alteration of the

Roll during the currency of a rating period. At page 363 Richardson J said:

The legislation proceeds on the premise, understandable in the

interests of order and certainty, that once any objections have been

determined the valuations entered on the roll are to stand until the

next roll revision unless there are any circumstances requiring or

justifying review.

McMullin J expressed a similar opinion.

[40] Mr Asher points out the amendments were the result of a policy change

following a decision to depart from the earlier and then accepted method of

valuation. He submits the entries now amended were entries made deliberately after

consideration and in accordance with the accepted practice of valuers at the time. In

making the original entries he points out the Roll was being completed in a manner

adopted over many years. We accept these factual submissions.

[41] North Shore and Waitakere accept their actions amount to an alteration of the

Roll during its currency. They claim the earlier entries of valuation were on an

aggregated block basis and were therefore not in accordance with s.7(2) of the

RVA/RVR despite any certification by the Valuer General. They were therefore, so

the Council argument goes, clearly made in error and the errors have been passed on

to the Roll. Accordingly the valuations are able to be altered under s. 14 of the RVA

and the fourth bullet point of Rule 4.1 of the RVR.

They claim the effect of the

changes was to preserve uniformity with existing roll values of comparable parcels


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of land as required by s.4. They submit if the course which they have taken had not

been followed, the Councils would be in breach of their statutory obligation to

preserve uniformity within the Roll Valuation and in accordance with the principle

of compatability New Zealand Land Development v Valuer General (supra). They

submit if the Rolls had not been altered it would be unfair to other ratepayers and

would leave the Council open to challenge.

[42] As an alternative source of authority the Council rely on s.13 of the

Interpretation Act. It provides:

13 POWER TO CORRECT ERRORS--

The power to make an appointment or do any other act or thing may

be exercised to correct an error or omission in a previous exercise of

the power even though the power is not generally capable of being

exercised more than once.

[43] We accept the word “error” is broad enough to encompass something which

is done inadvertently as well as something which is done intentionally and

deliberately. Provided we are correct in my determination of the s.7 issue the

Councils, clearly in the broad sense, have acted erroneously. The issue is not

however, whether they got it wrong, or right for that matter, but whether the actions

they took by issuing the fresh assessments were within their statutory powers to

correct an error.

[44] The original entries followed valuations made in accordance with the then

recognised and accepted valuation of land principles. Valuations accepted by both

the Council and the landowners. The entries did not result from any “error” such as,

in our judgment, is envisaged by the legislation or the rules. The Section is clearly

aimed at spelling out precisely the powers of the Council which, of course, means as

has been said by Court of Appeal in New Zealand Land Development v Valuer-

General (Supra) that this ensures certainty for the period of at least 3 years.

[45] In our judgment this was not an error which the Council had power to correct

under s.14.


17/35

17

[46] Nor do we consider s. 13 of the Interpretation Act assists the Council, for the

following reasons:

[al

Section 13 is in similar terms to s.256) of the Acts Interpretation Act

1924, but the new provision applies by reason of s.4(1) of the Act.

Cbl

The Councils submit as the original notices of valuation on the block

basis was incorrect and unlawful because they did not comply with

.

s.7(2) of the RVA (as I have ruled) the Councils were therefore able

to re-exercise the statutory powers of carrying out fresh valuations

and sending out fresh notices of valuation in order to correct the error

of law or to achieve the consistency required by the RVA with

equivalent separate properties.

[47] Section 13 is to correct an “error or omission”. For the reasons we have

given we do not consider the entries were errors within this section. Furthermore,

s.25 of the Acts Interpretation Act expressly provides this section only applies

“unless the context requires”. Section 4 of the Interpretation Act 1999 contains a

provision to like effect.

[48]

We are, therefore, of the view that where the RVA and the Rules contain

express and detailed provisions relating to the correction of the roll, the express

provisions prevent the more general provisions of the Interpretation Act applying in

this case.

[49]

Rodney District Council also submits s.14 of the RVA does not apply to it as

the valuations in issue were made as part of the process of compiling the new district

valuation roll to be used as from 1 July 1999. The valuations made were accordingly

not valuations appearing on the “current” valuation roll. It submits that at the time in

question, namely March 1999, the “current” valuation roll remained unchanged and

was continuing to be used for rating purposes up until 30 June 1999 when it would

be replaced by the new valuation roll. The new valuations sent out in March 1999

were not therefore “alterations to the current valuation roll” in terms of s. 14 of the

new RVA. Rather, the Council was in the process of compiling its new valuation


18/35

18

roll which would only be “current” as from 1 July 1999. Counsel submits therefore,

s.14 is not relevant and instead the Council was entitled to issue the fresh notice of

valuation in terms of s.13 of the Interpretation Act in order to correct the initial

notices which wrongly aggregated the subdivided lots. In our view, looking at the

actions of the Council in the context of the process of compiling the new district

valuation roll, this argument is without merit. This ground of objection is

accordingly upheld.

Valuations 6f the Properties

[50] This is simply a valuation issue. The question raised is, if each lot is separate

property as we have ruled, what value should be attributed to each lot.

WI

“Land value” is defined by s.2 of the RVA and refers to “the owner’s estate

or interest in the land”. The task of the valuer is to assess what the owner’s estate or

interest without improvements would realise if offered for sale on reasonable terms

and conditions. Constraints on alienability must be considered Valuer-General v

Mangatu Znc [1997] 3 NZLR 641.

[52] The plaintiffs claim even if the lots were properly individually assessed the

valuations were incorrect as they did not take into account a number of factors

including:

[al

PI

M

The possibility that the hypothetical purchaser would wish to acquire

additional adjoining lots from the vendor on sale of the land, i.e. the

possibility of a sale of a number or all of the lots to a single purchaser

with the consequent deduction in the value of the property sold;

The occasion of a large number of vacant unsold sections in one

locality with the consequential effect on the value as a result of the

oversupply of the market; and

Allowance for profit and risk interest and holding costs arising from

the fact that the sections would be sold down over a period of time.


19/35

19

[53] They submit that if each separate titled lot is to be entered as a separate

property in the valuation roll then the assessment of the owner’s interest in that

property must take into account not only such factors as just outlined, but also

factors relating to an owner’s block holding of land in a subdivision in the same way

that these would be taken into account if a single assessment were to be completed.

Thus an oversupply of the market should be considered along with the other matters

referred to.

[54] Such*an approach, it seems, is no more than an attempt by the plaintiffs to

obtain the same advantage as they would have obtained from a block assessment

with an overall reduction. It misconceives, in our view, the requirement to value the

owner’s interest. Contrary to the underlying claim by the plaintiffs, what is to be

valued is not the whole block but each separate property once identified as such. In

each case where a title is issued this will be the full freehold interest subject to such

limitations as fencing covenants etc. In the case of a lot identified as a separate

property on a plan, this again will be for the full freehold interest less, no doubt,

some allowance, minimal though it may be, for the fact that title has not yet been

formally obtained. This valuation problem is a matter which any competent valuer

would be capable of resolving.

[55] We heard from a number of witnesses on this aspect. We are satisfied the

correct approach as to the value in respect of each lot has been adopted.

The Rating Valuation Rules

[56] These rules are a form of delegated legislation. They are therefore

reviewable and can be declared ultra vires if found to be outside the terms of

statutory delegation Brader v Ministry of Transport [ 198 l] 1 NZLR 73.

[57] The empowering provisions for the making of the rules is s.5 of the RVA. It

provides:


20/35

20

5 VALUER-GENERAL MAY MAKE RULES SETTING

REQUIREMENTS IN RELATION TO VALUATIONS AND

DISTRICT VALUATION ROLLS--

(1)

The Valuer-General may from time to time make rules for all

or any of the following purposes:

G-9

Prescribing standards, specifications, and methodologies for

the rating valuation process, including--

(9

The data which must be gathered and the form in which it is

gathered:

(ii) a

The processes which must be followed in gathering the data:

(iii) The processes for forwarding that data to the Valuer-General:

(w

Prescribing who may carry out valuations or provide valuation

services for the purposes of this Act:

(4

Prescribing rules as to the maintenance and content of district

valuation rolls:

(4

Providing for the auditing and monitoring of general

revaluations, and of alterations during the currency of a roll:

(e>

Providing for the auditing and monitoring of equalisation

adjustments and special rating areas:

(0

Requiring the provision of information to the Valuer-General

or any other person or body specified by the Valuer-General relating

to valuations, general revaluations, equalisation adjustments, special

rating areas, and alterations during the currency of a roll by territorial

authorities:

(g>

Providing for the manner in which any valuation is to be

reviewed by a territorial authority as a result of an objection:

o-0

Providing for such other matters relating to valuations and

valuation services as are contemplated by or necessary for giving full

effect to the provision of this Act or as may be necessary or desirable

to allow the Valuer-General to perform his or her functions under this

Act or any related Act.

(2)

Any such rules may--

(4

Provide for when any valuation is to take effect:

09

Apply generally throughout New Zealand, or only to such

local authority or authorities or such district or districts as may be

specified in the rules:


21/35

21

(c)

Exempt from their application any territorial authority which

has commenced a general revaluation until the completion of that

general revaluation.

(3)

Before making any rules under this section, the Valuer-

General must--

@>

Publish a notice of his or her intention to make the rules in

daily newspapers published in Auckland, Wellington, Christchurch,

and Dunedin, respectively, and also publish the notice in the Gazette;

and

. {Editorial Note: For notice of intention to make Rating

Valuations Rules see Gazette 2000, p 659.)

@I

Give interested persons a reasonable time, which must be

specified in the notice, to make submissions on the proposed rules;

and

(4

Consult with such persons or groups representative of valuers,

local authorities, and other interested persons as the Valuer-General

thinks appropriate having regard in each case to the content and effect

of the proposed rules.

(4)

As soon as practicable after making any rules under this

section, the Valuer-General must notify their making in the Gazette.

{Editorial Note: For notice of Rating Valuations Rules coming

into force from 7 July 2000, with effect from 1 July 2000, see Gazette

2000, p 1351.)

(5)

The Gazette notice must specify where copies of the rules may

be inspected and obtained.

(6)

Any rules made under this section are to be treated for the

purposes of the Regulations Disallowance Act 1989 (but not for the

purposes of the Acts and Regulations Publication Act 1989) as if they

were regulations within the meaning of that Act.

[58] Rule 3.6 states

3.6 SEPARATE PROPERTY

For the purposes of assessing land and capital value under section 7

of the Act, any property for which there is a certificate of title under

the Land Transfer Act 1952 may be treated as a separate property.

Where one parcel of land is held in more than one certificate of title,

each title will be treated as a separate property except in the case of

fractional interest, timeshare and leasehold titles.


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22

Section 7(4) of the Act provides that Rules may be made to determine

the circumstances where land capable of separate occupation may be

treated as separate property.

In the following cases, land should be treated as separate property:

l

properties held under cross lease or unit title should be valued as

separate properties.

l where contiguous land is used as one farming operation the property

may be entered on the roll in one assessment provided there are not

different owners. Severance by a road, railway or river does not affect

contiguity. However, in the case of a farm or other large property

consisting of more than one block in different ownerships, separate

assessments are necessary even though there may be common use and

occupation;

l

where a substantial building straddles land in different ownerships a

single assessment may be made with apportionments to show the

values of the differently owned parts;

l reserves and other large holdings such as airports, harbours,

waterfronts etc may be assessed as one property; and,

l a property split by a local authority boundary will have to be shown

on the roll as separate properties even though it may not meet the

normal criteria. In this situation the land should not be valued as

separately saleable but as an appropriate proportion of the value of the

whole.

In the following cases, land should not be treated as separate property:

l commercial tenancies (e.g. in office blocks or shopping malls) must

not be valued separately;

. where there are separate titles for freehold and leasehold interests

other than cross leased properties a single valuation of the fee simple

interest is required;

.

where there are separate titles for undivided interests with no

defined areas of exclusive occupation a single valuation of the land is

required;

l residential premises and commercial floors held under a company

shareholding structure, where the company is the legal occupier and

ratepayer, are not capable of separate assessment; and,

l retirement villages will normally be treated as one property, unless

the ownership arrangements require unit owners to pay their own

rates.


23/35

23

[59]

The plaintiffs contend neither s.5 nor s.7 of the RVA authorise the Valuer

General to make rules for which, in effect, describe the circumstances in which a

Territorial Authority is to treat a property capable of separate occupation as a

separate property in the roll (see pleadings in the Statement of Claims).

[60] The Valuer General contends the valuation rolls need to be nationally

consistent and submits Rule 3.6 sets out general rules consistent with the RVA that

each parcel of land held in a separate certificate of title is a separate property.

l

[61] That is, the rules provide the context within which the discretion applies and

then provide a guideline as to how the discretion under s.7(4) RVA is to be applied

in order to provide a nationally consistent valuation database.

[62] We accept the Valuer General’s submissions. In our view the rules are doing

no more than indicating in a general manner how applications involving s.7(4)

should be considered. It does not direct a manner in which a property must be

considered nor does it direct that a property within the description of the rules must

be deemed a separate property. Such a suggestion as we so interpret the rules is well

within the powers of the Valuer General and within his statutory obligation. The

Valuer General is not limited from making procedural rules.

[63] The rules are therefore intra vires in our judgment. We point out in view of

our earlier ruling as to the effect of s.7(2), strictly speaking it was unnecessary for us

to express any opinion in respect of these rules.

Result

[al

[bl

[cl

,

The issue of individual valuation assessments in 1999 for each

separate lot, thereby resulting in separate entries in the District

Valuation Roll for each lot, was valid.

The Councils had no power to alter the Roll in the manner they did.

The value ascribed to each lot has been assessed correctly.


24/35

24

WI

A separate assessment for a lot identified on a plan deposited with

LINZ can be issued notwithstanding no certificate of title for such lot

has issued.

Judgment accordingly. In the circumstances there will be no order for costs.

Morris J

‘,

13

r

P )Ly

l

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

I

I.W. Lyall

Dated this

7aL

day of uw

2000.


25/35

IN THE HIGH COURT OF NEW ZEALAND

AUCKLAND REGISTRY

IN THE MATTER

BETWEEN

AND

AND

Dates of Hearing:

Counsel:

Judgment:

M.9901473-CO, M9901474-CO, M.9901475CO.,

M.9901476-CO., M.9901867~CO., M.9901868~CO.,

M.19-SDOO, M.20-SDOO., M.107-SDOO., M.lOS-SDOO.

of the Rating Valuations Rules 1998

NEIL CONSTRUCTION LTD

WEITI VIEWS LTD

ELAN PROPERTIES LTD

A G DRY-DEN LTD

CABR4 HOLDINGS LTD

UNIVERSAL HOMES LTD and

FLETCHER HOMES LTD

Plaintiffs

NORTH SHORE CITY COUNCIL

RODNEY DISTRICT COUNCIL and

WAITAKERE CITY COUNCIL

First Defendants

THE VALUER-GENERAL

Second Defendant

28 August 2000 - 1 September 2000

4,5 and 6 October 2000

R Asher QC, A Brown and R Bartlett for all Plaintiffs

A Galbraith QC and G Palmer for North Shore City Council and

Rodney District Council

K Berman and S Manalo for Waitakere City Council

H S Hancock and E Fitzgerald for Valuer-General

a

November 20Q0

RESERVED JUDGMENT OF MORRIS J

Solicitors:

Ellis Gould, DX CP22003, Auckland for Plaintif fs

Simpson Grierson, DX CX10092 Auckland, for Defendants except Waitakere City

Kensington Swan, DX CP22001 Auckland for Waitakere City

Crown Law Office, DX SP20208 Wellington for Valuer-General

Counsel Appearing:

R Asher QC., P 0 Box 4338 Auckland

A R Galbraith QC, P 0 Box 4338 Auckland


26/35

HI

These proceedings have been heard in conjunction with the objection

proceedings issued by the applicants and this judgment should be read in conjunction

with the judgment delivered therein.

The Claims

PI

The plaintiffs seek declarations that:

.

A.

Section 23 of the Rating Powers Act (RPA) applies to their

subdivisions;

B. If s.23 of the RPA does not apply, whether the actions taken by the

Rodney District Council and the North Shore City Council under s.21

of the RPA were valid and, in any event, a declaration detailing the

criteria which Councils should take into account in making any

decision under s.2 1 of the RPA.

C. The process followed by the Councils on review of the objections

filed was in breach of the statutory process set out in s.34 of the

Rating Valuations Act 1998 (RVA).

As to A:

PI

Section 23 of the RPA sets out the circumstances in which two or more

separate rateable properties are deemed to be one property for the purposes of

levying uniform annual general charges under s.19 of the Act or any separate

uniform annual charge under s.20 of the

Act.

PI

It provides:

23 UNIFORM ANNUAL CHARGES ON PROPERTIES IN

COMMON OWNERSHIP--


27/35

3

Where any 2 or more separately rateable properties are--

(a)

Occupied by the same ratepayer; and

@I

Used jointly as a single property; and

(4

Contiguous or separated only by road, railway, drain, water

race, river, or stream,--

they shall be deemed to be one property for the purposes of making

and levying any uniform annual general charge made under section 19

of this Act or any separate uniform annual charge under section 20 of

this Act.

.

There are therefore three limits to the application of s.23 and all must be satisfied.

There is no dispute between the parties; limitations (a) and (c) apply in the present

proceedings. The issue before me is whether limitation (b) applies. The plaintiffs’

position is each individual unsold lot is “used jointly as a single property” with the

others. The Council’s position is the word “used” requires that the land is not

merely owned or occupied by the same ratepayer but there must in addition be a

particular utilisation of the land.

PI

It is clear from the evidence the land comprised in the various subdivisions is

effectively, and practically speaking, vacant land. Some is being actively marketed,

some is being held as passive land. Some sections may eventually be sold

individually, others in blocks. There is no recognised activity as such on any of the

blocks.

I31

Councils are required to recover part of the rating revenue by levy of a

uniform annual general charge under

s.19

of the

WA

and (or) a uniform annual

charge under s.20 of the same Act. Section 23 makes no provision for a separate

discretion based on fairness. I do not find it necessary therefore, to determine or

discuss the conflicting and extensive submissions on the “fairness” or

“reasonableness” of the Council’s actions under s.23 (see the provisions of s.21).

PI

In my view joint use in the context of s.23 requires some activity which joins

in that use what are otherwise separate properties so as it can truly be said they are

being used as a single property. So a farming activity, an industry-like activity such

as pulp mill, a hotel with its associated facilities, a residential house with a tennis


28/35

4

court may all be active uses carried out over a number of separate properties which

justify a conclusion of joint use as a single property.

PI

The plaintiffs’ submissions essentially assert the individual lots, which have

been subdivided, are not separately used until sold. This however, is not the test

under s.23. The starting point before s.23 can apply is that each lot is a separate

property as defined by s.7 of the RVA. This starting point having been reached, the

question then is, are these separate lots being jointly used as single property? In my

view, passive ownership of separate properties is not a joint use. The fact separate

properties may be on the market one day and not on another mitigates against such a

construction. The manner in which the plaintiffs rate their landholdings likewise

cannot affect the construction of s.23. Likewise I do not consider the fact each

individual piece of land and/or the block on its own is regarded by the plaintiffs as

“land stock” provides the necessary element of joint use. In practice, once

subdivided into allotment by evidence of a deposited plan or title, the worth to the

subdivider-owner lies not in their togetherness as lots but in their separateness as

distinct lots of land. The bulk residential allotments are not united, they are actually

independent of each other.

The intentions of the particular landowner from time to

time likewise do not determine the issue. It is the actual use, if any, established by

evidence which must determine whether s.23(b) is satisfied.

PI

Applying the principles I have endeavoured to enunciate to the evidence

disclosed in the extensive affidavits filed, I am satisfied s.23 of the RPA does not

apply to the plaintiffs’ subdivision/holdings.

[lo] The declaration sought in this regard is accordingly refused.

AstoB:

[ 1 ] Section 21 provides for discretionary rating relief. Uniform annual general

charges or uniform annual charges may be reduced by Council on its own motion or

on the application of a ratepayer. The ratepayer must be the occupier of more than

one separate rateable property in the district, but there is no requirement the


29/35

3

properties must be contiguous. There is no requirement that there be a commonality

of use and the charges may be reduced by Council, in respect of one or more of the

separate rateable properties are occupied. In making its decision the Council is to be

guided by consideration of what is reasonable in the circumstances.

[12]

The plaintiffs now seek the following orders against the Rodney District

Council and the North Short City Council:-

[aI 1

PI

[cl

PI

An order quashing the Council decisions that in principle and in the

general case relief was not appropriate under s.21 in respect of unsold

subdivided land;

A declaration the Councils should give full consideration to

applications by developers with an open mind including all the usual

circumstances which apply in respect of subdivided land;

A declaration that 12 listed factors relating to subdivided land are

relevant considerations for the Councils in considering applications

under s.2 1; and

A declaration that both Councils have erred in law in construing and

approaching s.21 in an overly restrictive manner and in concluding

that if land held in multiple titles is not jointly used as a single

property, discretionary relief under s.21 was also not in general terms

available.

[ 131 The plaintiffs claim the reports and resolutions of these two Councils

establish both Councils have made a decision that in general discretionary relief

under s.21 will not be granted for the developers in respect of the unsold vacant lots

in their subdivisions. I therefore turn to deal with the evidence before me.

[ 141 In the case of Rodney, it passed a resolution on 17 December 1998 as

follows:


30/35

6

That the General Manager be delegated the power to reduce or cancel

any separate uniform charge or uniform annual general charge, in

respect to a written application from the occupier (pursuant to the

provisions of s.21(1) of the Rating Powers Act 1988) if he is satisfied

that all of the land concerned is used as one farming operation.

This resolution followed the receipt of a report dated 29 October 1998 to the effect

there would not be as a general rule any case for exempting the payment of uniform

annual charges on subdivided land pursuant to s.21. Such report concluded by

recommending a resolution in the following terms:

1

That, as a general rule, the Council’s policy be to levy uniform annual

charges and uniform annual general charges against every separately

rateable property within a subdivision - notwithstanding that

numerous properties might be owned and occupied by the same

owner - it being of the opinion that such properties are not used

jointly as a single property; (and) there is no case for granting

discretionary relief pursuant to the powers of s.21 of the Rating

Powers Act 1988.

[15] While I accept the Council does not appear to have formally adopted this

resolution, it does appear the Council accepted the viewpoints expressed in the

resolution.

[16] In September 1999 the Council reconsidered its resolution of December 1998

having received a report which stated:

The resolution is not quite correct.

The last sentenceof part (g) of the

resolution says, “if he is satisfied that the land concerned is used as

one farming operation”, when there will in fact be some cases (e.g.

two sections used by one occupier as a home and garden) where

discretionary relief would also be appropriate.

[ 171 A resolution was passed on 30 December rescinding the clause of the earlier

resolution and providing as follows:

That the General Manager be delegated the power to reduce or cancel

any separate uniform annual charge or uniform annual general charge

in respect to a written application from the occupier (pursuant to the

provisions of s.2 (1) of the Rating Powers Act (1988) if he considers

it reasonable in the circumstances to do so.


31/35

7

[ZS] Subsequently Hopper Developments Limited on behalf of Weiti Views

Limited and Elan Properties Limited were advised by the Council uniform annual

charges would apply to each section in the subdivision. Mr Sharplin on behalf of

Rodney Council acknowledged this view, namely that in the general case s.21 relief

would not be granted

for

subdivisions.

[19] No formal application for relief has been filed with Rodney by any of the

applicants.

[20] In the’ case of North Shore a report of 16 February 1999 recommended:

That there be no granting of discretionary relief pursuant to the

powers of s.21

of the

Rating Powers Act 1988 if the property is not

used jointly as a single property.

[21] On 24 February North Shore passed a resolution as follows:

That there is no granting of discretionary relief pursuant to the powers

of s.21 of the Rating Powers Act 1988 if the property is not used

jointly as a single property.

[22] In October 1999 the Council apparently realised its resolution of February

1999 could be challenged. A further report was obtained and a new resolution

passed stating:

That it is unlikely that the Council would regard i t as reasonable to

reduce or cancel charges in terms of s.21 of the Rating Powers Act

1988 in the case of separate properties within a subdivision with the

same occupier, although any such application will be dealt with under

its merits and in the context of its own particular circumstances.

[23] The Council’s Revenue Manager, Mr Wong Kam, in cross-examination has

acknowledged following this later resolution there was no real change to the basic

position of the Council, namely the developers would not be granted relief. A

written application from Green & McCahill seeking relief was subsequently

declined.

[24] No application under s.21 for relief had been made by any of the plaintiffs to

the North Shore Council.


32/35

8

[25] Under s.4 of the Judicature Amendment Act 1972 this Court may grant relief

in relation to the exercise, refusal to exercise, or proposed or purported exercise by

any person of a statutory power. Exercise by the Council of its powers under s.21 is

such a statutory power of decision and is open to review. The problem facing the

plaintiffs in this case is however, no application has been made by any of them for

the Council to consider. Mr Asher submits the only inference I can draw from the

material before me is any such application is doomed to fail and I should make some

form of declaration accordingly. He points out the Councils may on their own

motion, grant the relief referred to in the subsection.

[26] Mr Galbraith for the Councils refers to the current Rodney and North Shore

City resolutions. He submits neither circumscribes the decision other than in terms

of s.21. He submits the plaintiffs’ proceedings are really an attempt to have the

Court impose compulsory criteria on the Councils. He submits there is nothing

improper in any Council adopting a general policy provided that it does not preclude

it from making an exemption if the circumstances of the case warrants special

treatment as required by the legislation: Practical SIzooting u Police [ 19921 1 NZLR

709.

[27] I can appreciate the plaintiffs’ concerns. They feel they have come up

against a brick wall so far as any possibility of receiving any relief is concerned.

The simple fact, however, is neither Council has received an application from any of

them and in the light of the latest and enforced motions which correctly set out the

Councils’ responsibilities, I am not prepared without more to determine either

Council will act contrary to its statutory obligations at the hearing of any such future

application. Nor am I prepared to formulate some form of test list or check sheet

illuminating matters which a particular Council must take into account when hearing

an application for relief. What will or will not be relevant will depend upon the

particular circumstances of each applicant at the hearing of any application.

As Mr

Galbraith acknowledged, the Councils must give full consideration to applications by

developers with an open mind and take into account all the usual circumstances

which apply in respect of subdivided land. In the event a Council does not do so

when considering an application any ratepayer has rights of objection and recourse to

the Court.


33/35

9

[28] The declaration sought is accordingly refused.

As to C:

[29] Under s.32 of the RVA an objection must be made within the time and in the

manner specified in Regulations made under the Act. Regulation 3 of the Rating

Valuations Regulations 1998 requires a Notice of Valuation to include information

as to the pe;son with whom an objection must be lodged and the postal address. In

each of the cases here the Notice of Valuation specified Quotable Value at the postal

address at Takapuna as being the appropriate person with whom objections were to

be lodged. All plaintiffs accordingly directed all objections lodged to Quotable

Value at that address.

[30] Section 34 specifies the process for the consideration of objections:

[al

The Council must refer the objection to a registered valuer or other

person of a class specified in the Rules (there is none) who may be the

same person who undertook the original valuation or decision for

review.

PI

A review of the objection must be undertaken in the first instance by

the registered valuer or other person specified in the Rules.

[cl

The review must be conducted in accordance with any Rules.

PI

On conclusion of the revieb the Council may determine to alter the

valuation or decline to alter the valuation.

[31] In the case of all the objections, the decision following receipt of the

objection was made by Quotable Value as the valuation service provider for the

Council concerned. In no case was a review carried out by Quotable Value and

considered by the Council. Councils have taken the view that they have delegated to

Quotable Value the processing of the objection from receipt through to a written

decision and to written notification and that Council input was not required in the


34/35

10

process. The plaintiffs claim by delegating the decision to determine objections to

Quotable Value and failing to determine them themselves the Council has failed to

comply with the statutory regime provided for by s.34.

[32] The Councils contend s.34 has been complied with. They contend in the

context of the RVA the reference of subsection (4) to the Territorial Authority

should be interpreted to mean “The Territorial Authority through its valuation

services provider”. They submit the RVA sets out various powers and functions of

Territorial Authorities in preparing and maintaining District Valuation Rolls, of these

functions those which .come under the definition of valuation services must be

carried out by registered valuer and valuation services includes the altering of any

such value objection. They contend the interpretation they seek would give effect to

the purpose of the Act which has required a valuation exercise to be contracted out to

a valuation service provider. They claim Councils have no valuation experience and

for the Council to have a right of veto over the valuer’s decision and review would

introduce an unacceptable potential for Council interference into what is intended to

be an independent valuation task. They submit that a requirement for Council to use

registered valuers to carry out valuation services is designed so as to avoid a

potential conflict of interest. They also submit that such a result is also consistent

with s.36 of the RVA which gives a Territorial Authority the right to object to the

review under s.34. They submit it would be inconsistent for a Council if it was able

to object to its own decision.

[33] I do not accept the Councils’ submissions. The definition of “valuation

services” in the RVA implies the functions of a valuation service provider under the

Act are limited to the fixing and altering of Roll values and granting of equalisation

certificates and does not extend to the substantive decisions which the statute

imposes on Councils in relation of the preparation of District Valuation Rolls and the

determination of objections. This conclusion, in my view, is reinforced by s.50 of

the RVA which allows the delegation by a Local Authority of any of its functions

and powers under the RVA “to any officer or employee of the Local Authority”.

The section does not refer to a contractor and in particular does not refer to valuation

service providers.

In my judgment the terms of the Act are plain and


35/35

11

straightforward, the Council is required by virtue of s.34(4) to make the final

decision on any objection.

[34] The plaintiffs ask that the objections should be allowed and the individual

valuation assessments which were the subject of the objections declared invalid. I do

not consider such declarations should be made in the present case. My reasons are:

[al

This issue was not raised until the hearing was underway.

*

PI

The plaintiffs asked for the objection to be heard by the Land

Valuation Tribunal under s.36. All parties proceeded on the basis the

decision had been made by the Council. While the plaintiffs may

well not have appreciated Council itself had not made the actual

decision to disallow the objection, I think it is now too late to raise

what is essentially a point of procedure only.

[cl

Granting the relief sought would be futile.

It would simply return the

issue around and back to the Court for determination. The substantial

issues as to the correctness or otherwise of the Councils’ approach or

rather the approach made by its agents has been discussed in this

judgment.

[35] Relief is accordingly refused. In the circumstances, there will be no order for

costs.

Morris J

Dated this day of VW

2000.

uagc neil construction v nscc

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