Case summary of Auckland Council v Auckland Council [2025] NZHC 1214: An important decision on development contributions

The Auckland Council recently applied to judicially review a decision upholding a developer’s objection to a development contribution assessment. This review was dismissed by the High Court.

Legal context

The Local Government Act 2002 (Act) grants power to territorial authorities to require development contributions from developers.[1] A development contribution can be in the form of money, land or both.[2] It may be required when a resource consent is granted for a development under the Resource Management Act 1991 (RMA).[3] Essentially, the intent is to ensure that a council can recover land or money where a development has led to a need or demand for further community facilities. Development contributions can be objected to under the Act.

Summary

In 2012, Fletcher Residential Ltd (FRL) proposed to develop a site in Auckland (Development Site/The Three Kings precinct). To advance the proposal, an initial land exchange agreement with Auckland Council (Council) was entered into in 2017 and was carried out in 2018. The exchange involved Council reserve land being exchanged for FRL’s private land, and FRL carrying out reserve works (including the creation of sports fields, playgrounds, public amenities and shared spaces).

A resource consent was granted to FRL in 2023 to subdivide land and construct 27 houses in Auckland at the Development Site.

Later that year, the Council required $370,350 worth of development contributions for the resource consent.

FRL objected to two parts of the assessment ($100,038 for reserve development and $50,939 for community infrastructure) on the basis of the reserve works carried out earlier as part of the land exchange agreement.

A Commissioner upheld FRL’s objection to the development contributions. She found that the reserve works were part of the Three Kings precinct development that the consents also related to, and that the reserve works would substantially reduce demand to the point where there was no demand from the development. She also found it was difficult to argue that additional community facilities were required by the development and that it was “double dipping” for the Council to require the developer to both pay for and provide the sports field and reserve as part of the land exchange agreement and then require a development contribution for reserves.

The Council applied to judicially review the Commissioner’s decision. The High Court found that the Commissioner was correct, and dismissed the Council’s challenge.

Implications

This case is a reminder to be clear on what the development contribution assessment is based on, and to ensure that development contributions are not sought for matters that have already been provided for by the developer, and not prohibited from being claimed as a credit or offset in any prior agreement.

Want to know more?

If you have any questions about development contributions, please contact our specialist RM team.

[1] Local Government Act 2002, s 198.

[2] Section 197(2).

[3] Section 198(1).

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