Question mark over Shelly Bay

A massive development planned for Shelly Bay in Wellington has entirely halted after a court judgment quashed resource consents.

The Court of Appeal has ruled Wellington City Council wrongly interpreted the law in granting consent for hundreds of apartments and townhouses, in a decision yesterday.

The ruling has thrown into question $500 million plans to build 350 apartments and townhouses, hotels, a rest home, ferry terminal, marina and cable car link to Mt Crawford, at the idyllic Miramar Peninsula site.

A council previously confident in its decision, as well as developers The Wellington Company and Port Nicholson Block Settlement Trust (PBST), are now uncertain how to proceed.

Among available options are an appeal, a renewed resource consent process, or reworking the development plans.

The court found that the council had misinterpreted the Housing Accords and Special Housing Areas Act (HASHAA), designed to give more permissive rules for housing consents.

The council had used the housing accord law to effectively ‘‘neutralise’’ all other considerations, which may have produced a different outcome if properly considered.

The council had used the need to increase housing supply to make a finding that the environmental effects of the development were ‘‘no more than minor’’.

The aim of increasing housing was not logically relevant to deciding an environmental effect, and was improperly weighed.

Given the way the council had defended its conduct the first time around – with council employees giving evidence when the consents were challenged – it should consider using independent commissioners to decide whether to grant the consents, the court said.

Council chief executive Kevin Lavery declined to comment until the findings were studied in detail.

Wellington Company director Ian Cassels said development of Shelly Bay would happen but he could no longer be sure how or when. ‘‘Rightly, the court’s made a decision. We’ve got to work with that, and the council’s got to decide what it wants to do.’’

PBST chair Wayne Mulligan said he was unable to comment until fully considering the judgment.

Thomas Wutzler, of local business group Enterprise Miramar which challenged the consent process, was pleased with the outcome, saying the council needed to return to the original district plan for the area, which had clear expectations for how the area should be developed.

‘‘If it had been originally looked at under the district plan, it wouldn’t have looked like it does now,’’ he said.

The court did not accept Enterprise Miramar’s allegation that Wellington City Council was interested in the result of the application because it owned some land that would need to be leased or bought for the development to proceed.

Wellington Mayor Justin Lester, who has supported the project, was unwilling to comment on the decision. Eastern ward councillors Simon Marsh and Sarah Free were among those who also declined to comment.

Councillor Andy Foster said it was apparent the council had failed to properly weigh heritage, environment, and infrastructure concerns – something he raised with staff previously.

‘‘It really did feel like the provision of housing, and everything that goes with that, trumps everything else.’’

Future attempts to gain resource consent may fail, as the development plan did not address environment, heritage or infrastructure concerns, he said.

Councillor Simon Woolf said the parties should come together to find a solution that avoided further legal disputes.