High Court rules in Mangawhai rates case

A newly-issued High Court decision quashing several years of Northland Regional Council (NRC) rates in the Kaipara could have implications for local authorities nationally, council Chairman Bill Shepherd says.

In the 17 August decision, the High Court makes an order setting aside the regional council's rates for the Kaipara district for the five rating years 2011/12 to 2015/16 inclusive and any penalties imposed by – or on behalf of – NRC over that same period.

However, the High Court was clear that there was to be no order requiring the council to refund the rates and penalties involved, despite finding for the plaintiffs (the Mangawhai Ratepayers and Residents Association and Richard Bruce Rogan and Heather Elizabeth Rogan) on the legal status of the rates.

Rejecting the plaintiffs' request for a return of the rates, the judge said an order to that effect "goes beyond the bounds of the present (judicial review) proceeding".

Regional Council Chairman Bill Shepherd says at the heart of the case overall was the council's use of its Kaipara district counterpart to collect rates on its behalf.

"Council takes all its legal responsibilities very seriously and naturally is very concerned to comply with these. There are definitely a number of important issues thrown up by – and lessons to be learned from – this case and council is now very carefully considering both High Court judgments and our options; including whether to appeal."

Chairman Shepherd says the judge's finding has potential implications not just for Northland, but for other councils around the country.

"Council is already seeking a change to the Rating Act to clarify the rating activities that can be undertaken on its behalf by a district council."

In an earlier interim judgement on the case, the High Court had ruled the rates were unlawful, but sought further submissions and evidence on what, if any, further relief should be granted. In the final decision, the High Court noted the regional council had acted in good faith and "may have fallen victim to legislation that was less precise than it needed to be".

Chairman Shepherd points out the judge's decisions do not relate to rates collections for the current financial year, or the 2016/17 financial year.

Judgment documents

Interim Judgment document - 15 September 2016 (PDF, 351KB)

Judgment document - 17 August 2017 (PDF, 216KB)