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4. Frivolous and vexatious submissions and trade competition

One of the reforms instituted by the last Government as part of the 2005 Amendment Act was the conferring upon local authorities of the power to disallow a submission on the grounds that it was frivolous or vexatious.

This power has been so sparingly used that no member of the TAG is aware of it ever having been exercised at all.

There are nevertheless still complaints from both Councillors and applicants that hearings are being prolonged by such submissions.

The reluctance of hearing panels to invoke the new powers is probably founded upon a natural and commendable desire to allow submitters to have their say, and a realisation that if the power was to be invoked any submitter so struck out could seek a High Court order invalidating that decision, thereby giving rise to the need to re-determine the application. This would of course in fact delay the process rather than streamline it.

A minority of the TAG favoured the introduction of a standing or status test for submitters similar to that formerly in place under the Town & Country Planning Act 1977. The minority saw merit in restricting the right to make a submission on an application to those with a greater interest in the matter than the public generally. Such a reform, it was felt, would limit the number of vexatious submitters and focus discussion on the key issues and effects. This was seen as a particularly helpful way of countering opposition to projects from submitters who may live distant from the subject site, but who nevertheless filed a submission in opposition to a development.

The majority, however, felt that such a change would run counter to the participation-orientated nature of the RMA, and would in any event not be particularly effective in addressing the problem of frivolous or vexatious submissions. Certainly, that was the experience of those members of the TAG who had worked under both the former regime and the present Act.

We therefore recommend that no action be taken in relation to those suggestions to reinstate a status or standing test.

The question of trade competition is however quite a different matter. Particularly in the supermarket business, we have seen for many years the spectacle of traders opposing resource consent applications filed by their competitors. The objectors invariably appeal any favourable decision to the Environment Court, and commonly to the High Court and beyond. Indeed, a number have even reached the Supreme Court.

The commercial incentives clearly favour such tactics.

Even if required to pay costs, the unsuccessful competitor will invariably be substantially ahead in a financial sense by virtue of not having to face competition for the decade or more that it has succeeded in “protecting its patch”. The effect of this anti-competitive behaviour is to erect untenable barriers to entry in the market place, increase the prices paid by consumers, introduce delays in the hearing of other matters in the Environment Court, and to generally bring the RMA into disrepute.

We therefore propose a suite of measures which, if enacted as a package, we are confident will put an end to this practice.

We recommend that:

  1. all current provisions in the Act that prohibit consideration of trade competition, be amended so as to also prohibit the consideration of the effects of trade competition

  2. it also be made clear that the effects of trade competition are not matters for consideration when a view is formed as to whether the effects on the environment require that a resource consent be notified or not
  3. Schedule 1 be amended to provide that a submission on a proposed policy statement, or plan change that concerns the activities of a trade competitor can be made by any person, provided that the person is directly affected and the effect concerned does not relate to trade competition

  4. an obligation be imposed on parties to disclose to the Court if they are being supported, funded or encouraged by a trade competitor

  5. the ability of trade competitors to take part in appeals as third parties be removed

  6. indemnity costs be awarded against a party who brings proceedings motivated by trade competition, or who supports proceedings based on a similar motivation

  7. a damages regime be introduced whereby persons adversely affected by the anti-competitive behaviour of trade competitors will be able to recover damages associated with the bringing of any appeal proceedings.