Native trees in Maungataniwha Forest. Photo / Forest Lifeforce Restoration Trust
Wairoa District Council's forestry rating system has withstood another attack in court - this time from the owners of a forest recognised as New Zealand’s largest private conservation project.
However, the challenge brought by Ashland Investments Limited (Ashland) and Forest Lifeforce Restoration Trust (FLR) over rates they claim were unfairly charged for Maungataniwha Forest was unsuccessful.
In a decision released to The Gisborne Herald, Justice Paul Radich said the grounds to review the rates charged for Maungataniwha had not been made out.
“The council’s decision-making processes were sound and its decisions sat comfortably within the ambit of the broad powers given to it for the purpose of setting rates.”
The ruling follows an unsuccessful Court of Appeal challenge by the New Zealand Forest Owners Association (NZFOA) to the Council's 2021 rates decision, which had imposed rates on larger forest owners five times above those on neighbouring farms.
While the challenge in this case, was to the creation of the protected and non-protected subcategories for the indigenous forest category in 2021 – and to the alleged failure in the 2018 decision to create a distinction between indigenous and exotic forests - the cases had much in common, Justice Radich said. The descriptions of the relevant background, of the decision-making process, of the relevant legislation and of the legal principles in the NZFOA decision were relevant here.
The 12,470.3ha Maungataniwha Forest is owned by Ashland, which together with FLR, has been working on native forest restoration and other ecological projects.
The trust’s Operation Nest Egg kiwi project is the largest of its type in the North Island, producing 299 chicks for release into the wild over the last 10 years.
Areas of pine are being converted to native forest and significant predator control work is being done with the aim of securing breeding areas for other endangered native bird species — whio, whitehead, robin and tomtit.
About half the forest (6037 hectares) is indigenous and is subject to a sustainable forest management plan (FMP) that provides for the harvest of the forest for a term of 50 years from October 20, 1996.
Most of the rest is pine (6433.3ha), A small tranche is protected by the Queen Elizabeth II National Trust (334ha), which is exempt from rates.
The pine block was operated as a production forest by its previous owners and there is still a forestry right over it, enabling it to be harvested by a third party for a term of 26 years from July 2018.
In their review application, Ashland and FLR claimed rates-setting decisions made by Wairoa District Council in 2018 and 2021, and the application of those decisions to Maungataniwha, were flawed, affecting the subsequent rates years between 2018 and 2021 and those to come.
The 2018 decision meant owners of forestry land would pay a rate at a proportion of five times that paid by residential ratepayers (for each dollar of capital value).
The applicants claimed that rate was designed for production plantation forestry — not one where the focus was mainly on preserving, not harvesting, indigenous forest land.
While the council differentiated in its 2021 rates-setting decision between indigenous and exotic forest, it made a further distinction between protected and non-protected indigenous forest land.
That was a disbenefit for owners of non-protected indigenous forest land such as that in Maungataniwha, as they would pay a rate at a proportion of 1.6 times that paid by residential ratepayers.
Ashland said it had not undertaken any harvesting activities on the indigenous forest block and there had been no approved annual logging plans under the Forest Management Plan since 2001.
They said that harvesting activity on the pine forest block was limited to begin with and had declined to the point where all production forestry operations had ceased by December 31, 2017, other than in two small areas in which production forestry operations had continued to limited extents.
Ashland pointed to the need for an approved logging plan and resource consent as a measure against it suddenly starting any harvesting.
Justice Radich said the issues raised for the court’s attention boiled down to whether the council had —
(a) erred in law in relation to the way in which it defined — by reference to land use — the rating categories that had been created, and then applied to the applicants;
(b) erred in fact, or through failing to have regard to factual and legal considerations, in the ways in which it applied relevant rating categories to the Maungataniwha forest land;
(c) Otherwise acted unreasonably.
There had been no such error or unreasonableness, the judge said.
At the heart of the applicant’s case was whether the council failed to draw a distinction between the potential use of the applicants’ land, on the one hand, and their actual or current use of the land, on the other.
Although their land was not protected in a legal sense, they claimed it was only being used for conservation and ecological purposes, therefore the rating differential through the forestry category should not apply to them.
However, the judge found the council was well within its broad powers to apply the category it had, which was not just limited to production/plantation forestry.
“It is implicit in the scheme of the legislation that a rating system and its diversity remains primarily a taxation system and not a system based upon the notion of user-pays.”
The council had taken into account that Ashland was the largest indigenous forest in the Wairoa district, paying 92 percent of the total rates and making up 80 percent of the land for all properties classified as indigenous forests in the district. The property right to harvest was also a relevant consideration.
“In circumstances in which the use of the land, through sale or otherwise, could be changed at any time, and in which the differential categorisation the council adopted is in accordance with the Local Government Act and the Rating Act, there was in my view no error of law,” Justice Radich said.
The Forest Management Plan registered against the title prior to the purchase of the property by Ashland had a 50-year term. Accordingly, its existence sat uncomfortably with the applicants’ objectives.
Those concerns would need to be addressed through, for example, providing further QEII Trust covenants or conservation covenants that would provide for the actual protection of the ecological work undertaken on the land.
Such measures had been discussed with the applicants as a means of them obtaining reclassification and, as a result, relief from rating burdens.
The council had said that if the Forestry Right and the Forest Management Plan were to be surrendered and a covenant protecting the forests put in place, then the applicants’ land could be reclassified to “protected forest”.
There was nothing unreasonable about that principled approach, the judge said.
Read More: NZ Forest Owners Association says court's finding a dreadful precedent
Wairoa mayor pleased with appeal court's decision in forest rating stoush
Mayor Rehette Stoltz is seeking another term in the upcoming election.