Case Law

National Environmental Standard for Assessing and Managing Contaminants in Soil to Protect Human Health

NES

Author: Bronwyn Carruthers (Partner) and Simon Pilkinton (Solicitor), Russell McVeagh
Number: 102
Court: Environment Court
Party: Hastings District Council [2013]

Introduction

In this decision, the Environment Court made three declarations relating to the National Environmental Standard for Assessing and Managing Contaminants in Soil to Protect Human Health (“NES“).  These declarations address the application of the NES in circumstances where a resource consent granted prior to the gazetting of the NES (on 13 October 2011) authorises activities that are now subject to the NES. 

Background

In the Hastings District, there are approximately 56 residential lots that were “subdivided” (in the sense of having received subdivision consent under the RMA) before the NES was Gazetted, but which have not yet been developed by way of earthworks or the construction of residential buildings.  Most of these properties are on land that was formerly used for horticultural purposes and are likely to have been contaminated by agrochemicals.  Under Regulation 5(7) of the NES, land that is likely to be contaminated is now subject to the NES and certain contamination testing and remediation requirements apply when consent is required for an activity covered by the NES.

The Hastings District Council (“Council“) was concerned that, following the Gazetting of the NES, the owners of properties that had been subdivided but not yet developed would be required to have their land tested and, if necessary, remediated in accordance with the NES before that land could actually be used for residential purposes.  The Council accordingly sought declarations from the Court to confirm the legal position, in the following terms:

1.   May the construction and subsequent occupation of a dwelling along with any associated disturbance of the soil (‘the activities’) on an allotment (‘the site’) created in accordance with a subdivision consent granted before 13 October 2011 (‘prior subdivision consent’) be lawfully carried out under section 9(1) of the Resource Management Act 1991 (‘RMA’) without further resource consent notwithstanding contravention of the NES, and pursuant to sections 9(1)(a) and 43B(5) of the RMA: 

(a)     in all such cases, or 

(b)     for land within Hastings District, where the prior subdivision consent contains conditions for the purpose of protecting human health upon residential use of the site, and in particular testing by a suitably qualified and experienced engineer following completion of site preparation earthworks on the site (including any necessary remediation) to confirm that the levels of contaminants in the Residential Soil Health Based Guidelines as set out in Rule 15.1.9.18 of the Hastings District Plan are not exceeded on the site, or 

(c)     for land in any other district, where the prior subdivision consent contains equivalent conditions for the purpose of protecting human health upon residential use of the site, and including testing by a suitably qualified and experienced engineer following completion of site preparation earthworks on the site (including any necessary remediation) to confirm that the equivalent standards of any other District plan are not exceeded on the site. 

2.   Where the relevant territorial authority has issued a certificate under s 224(c) of RMA pursuant to a prior subdivision consent following completion of site preparation earthworks for the subdivision, are the activities on the site a change in the use of the site to which the NES applies (having regard to regulation 5(6) of the NES) and, if not, may they be lawfully carried out under section 9(1) of RMA without further resource consent notwithstanding the NES: 

(a)     in all such cases; or 

(b)     where the prior subdivision consent contains conditions to the effect stated in paragraph 1(b) or 1(c). 

The Court recognised that the issues raised by the Council in its application for declarations were likely to be relevant beyond the Hastings District.  Because of this, the Court ordered the Council’s application to be widely notified so that other interested persons could join the proceedings if they wished.  While no interested persons ultimately came forward, the Court did receive legal submissions on behalf of the Secretary for the Environment, who adopted the role of amicus to assist the Court. 

Declarations declined by the Court

At the outset, the Court confirmed that, in the event of a conflict, a subdivision consent granted prior to the notification in the Gazette of the NES (“pre-notification consent“) will prevail over the NES.  This is because section 43B(5) of the Resource Management Act 1991 (“RMA“) provides that a resource consent granted before the date on which a national environmental standard is notified in the Gazette will prevail over the standard.  The critical question in these proceedings was therefore whether there is a conflict between the activities regulated by the NES, and the activities that are authorised by a subdivision consent.  If there were such a conflict, then a pre-notification consent would get the benefit of section 43B(5) and would prevail over the NES. 

In determining the critical question, the Court first considered the activities that are regulated by NES, which are set out in Regulation 5.  Of these activities, the Court held that those activities that come within the ambit of Regulation 5(4)(a) – disturbing the soil of a piece of land for a particular purpose – will not commonly be within the terms of a subdivision consent.  This is because a subdivision consent will not generally authorise the construction of a residential dwelling, nor will a subdivision consent generally authorise the excavations required for the foundations of a dwelling.  In any event, the Court held that it will always be a matter of fact in each case whether the disturbance of soil for the construction of a residential dwelling is authorised by a subdivision consent. 

As a result of these findings, the Court declined to make declaration 1(a) (that the construction of a dwelling created in accordance with a pre-notification subdivision consent is permitted “in all such cases”) as sought by the Council.  The Court also declined to make the declarations 1(b) and 1(c) sought by the Council (ie that a pre-notification subdivision consent will prevail over the NES where that consent is subject to conditions, either on the consent itself or via rules in the relevant District Plan, for protecting human health upon the residential use of a subdivided site).  The Court considered that in every case, the same fact-dependent question must be asked – what does the particular pre-notification subdivision consent actually authorise?  Only where a pre-notification subdivision expressly authorises activities that are controlled by the NES, will that particular subdivision consent prevail over the NES in accordance with section 43B(5) of the RMA. 

The Court also declined to make the declarations 2(a) and 2(b) as sought by the Council, which brought section 224(c) of the RMA into consideration.  Section 224(c) provides that survey plans effecting subdivisions must not be issued unless a certificate is lodged with the Registrar-General of Land stating the consent conditions that have been complied with.  The Court held that a section 224(c) certificate does no more than authorise the Registrar-General of Land to accept a subdivision plan as being compliant with the relevant statutory requirements of the RMA, and then to issue Certificates of Title for the resulting lots.  In particular, a section 224(c) certificate does not constitute a change in use in terms of Regulation 5(6) of the NES.  Therefore, whether a s224(c) certificate has been issued or not is irrelevant when considering whether a subdivision consent is subject to the requirements of the NES for testing and, if necessary, remediation to be carried out on land that is likely to be contaminated.

Declarations made

Against that analysis, the Court made the following two declarations:

1)             The construction and occupation of a dwelling and any associated disturbance of soil on an allotment created in accordance with a subdivision consent granted before 13 October 2011 may be lawfully carried out under section 9(1) of the RMA without further resource consent notwithstanding contravention of the NES if, and only if, the subdivision consent specifically authorises the disturbance of soil for the purpose of constructing and occupying the dwelling.

2)             That will be the case whether or not the territorial authority has issued a certificate under section 224(c) of the RMA. 

Additional declaration

After declining the declarations sought by the Council, the Court considered Regulation 5(6) of the NES.  Regulation 5(6) provides that the NES applies to an activity which “changes the use” of a piece of land to a use that, because the land is or is likely to be contaminated, is reasonably likely to harm human health.  Regulation 5(8) of the NES deems the subdivision of “production land” to be a “change of use” within the meaning of Regulation 5(6) of the NES. 

It is accordingly a relevant question, when considering a pre-notification subdivision consent authorising the subdivision of rural land for residential development, whether the change in use of that land occurs at the time subdivision is effected, or at the time the houses are complete.  This is because, if the change in use occurs when the houses are complete, that change in use cannot usually be said to be authorised by a pre-notification subdivision consent, which as set out above would not commonly authorise the actual construction of a dwelling.   In these circumstances, a landowner will need to meet the testing and, if necessary, remediation requirements under the NES, regardless of the pre-notification subdivision consent.

In the context of many rural subdivisions, the Court considered that once the roads and access ways are formed and sealed, building platforms are contoured, and drainage and other services are installed (which are all commonly activities that are authorised under a subdivision consent), the use of that land will have “changed”.  In these circumstances, the change in use can be said to have occurred at the time the subdivision is effected as it was authorised by the subdivision consent, meaning that Regulation 5(6) will not usually apply where a subdivision consent was granted prior to the Gazetting of the NES.  However, once again, a factual assessment is required in each case to determine when the “change in use” of subdivided land can be said to have occurred.  The Court accordingly made the following third declaration:

(3)            Where the subdivision consent in question contains conditions for the purpose of protecting human health upon residential use of the site, it will be an issue of interpretation in each case whether the change of use occurs at the time of subdivision, or when the house(s) are complete and occupied.

Comment

The Court clearly recognised the importance of these proceedings when it ordered the Council’s application to be widely notified.  Its three declarations provide guidance to territorial authorities and resource management practitioners across the country as to the application of the NES in relation to proposed developments that received resource consent prior to the NES’ Gazetting.  In each case, a factual assessment will be required as to whether there is a conflict between the NES and the activities authorised by the pre-notification consent.  Only where a pre-notification consent expressly authorises activities that are restricted or prohibited by the NES, will that particular consent prevail over the NES in accordance with section 43B(5) of the RMA.