More than $1.7m in legal fees for Kaipara District Council

Mangawhai ratepayer Bruce Rogan was among those pursued by the Kaipara District Council over unpaid rates and arrears. Photo / NZME

Kaipara ratepayers have forked out $1.7 million on legal fees to recover outstanding rates and on lawyers hired to defend against challenges by members of the Mangawhai Residents and Ratepayers Association.

That's more than the amount the Kaipara District Council will spend in the 2020/21 financial year on flood protection and control works and stormwater drainage.

It constitutes 3.5 per cent of KDC's audited revenue of $47.6m as contained in the 2018/19 Annual Plan.

The $1.7m was spent by KDC over six years and mayor Jason Smith said his council had had to defend itself against challenges brought against it by the association, its chairman Bruce Rogan, and his wife Heather.

Of that amount, KDC spent $334,000 defending itself against the Rogans.

The legal battle between the association and KDC spanned 10 years and was over the controversial $57m Mangawhai community wastewater scheme that cost more than five times the original amount.

About 100 ratepayers, including the Rogans, refused to pay rates and penalties from 2012 in protest against Parliament retrospectively passing the Kaipara Validation Act.

The act validated irregularities in the setting and assessing of Kaipara district rates from the 2006/07 financial year to 2011/12 in respect of the wastewater scheme.

In May, the Rogans paid $115,000 in penalties and court costs, bringing the protracted legal battle to a close while KDC is continuing to seek rates payments from two remaining Mangawhai landowners who are continuing their protest in relation to the wastewater scheme.

The association and the Rogans brought six challenges against KDC over six years.

Until October 12, 2019 KDC defended its case under the direction of the Crown manager, who remained in place to oversee ongoing legal action against the council.

The mayor said complaints that KDC had pursued the Rogans were inaccurate. Instead, he said KDC had had to defend itself against the challenges to be fair to the vast majority of ratepayers who had paid their rates in full.

"It's disappointing that this has gone on for so long and has cost ratepayers so much. Mr and Mrs Rogan could have stopped after a change in law legitimised the council's position, or after the office of the Auditor General published a detailed report on events surrounding the wastewater scheme decisions.

"They could have stopped at any time. Instead, the Rogans chose to continue pursuing the council as far as the courts would allow.

"We believe we had a responsibility to recover whatever costs we could on behalf of ratepayers. The costs awarded by the court don't cover the council's defence costs but it goes a small way towards it."

Kaipara mayor Jason Smith is disappointed the legal stoush between his council and some Mangawhai ratepayers went on for too long. Photo / Michael Cunningham

In reply, Bruce Rogan said for many months, he and others have sought release of information about how much has been spent by KDC in its pursuit of rates arrears.

He said KDC has now disclosed, under pressure from the community, the total amount it spent to recover about $20,000 in penalties from the Rogans.

All the rates arrears were tendered to KDC and the Northland Regional Council before the territorial authorities sued for recovery of the rates, he said.

"The mayor has gone on record claiming that the Rogans initiated all the proceedings that gave rise to all the costs. The Rogans and the MRRA initiated the first proceedings, which were effectively stymied by passage of the retrospective bill.

"All the remaining court action was the result of the council issuing proceedings against the Rogans and over 100 others for recovery of rates that had already been tendered and rejected.

"All the subsequent proceedings resulted from attempts by the Rogans to defend themselves, which, we understand, is still something that is allowed within the New Zealand legal system."

Rogan said he and his wife agreed to be a test case to minimise the cost to both the KDC and citizens of establishing the validity of the claims by both councils.