Waikato Regional Airport Ltd v A-G of New Zealand
| Jurisdiction | UK Non-devolved |
| Judge | Lord Walker of Gestingthorpe,Lord Nicholls of Birkenhead |
| Judgment Date | 30 June 2003 |
| Neutral Citation | [2003] UKPC 50 |
| Court | Privy Council |
| Docket Number | Appeal No. 77 of 2002 |
| Date | 30 June 2003 |
[2003] UKPC 50
Present at the hearing:-
Lord Nicholls of Birkenhead
Lord Hope of Craighead
Lord Hutton
Lord Rodger of Earlsferry
Lord Walker of Gestingthorpe
Privy Council
[Delivered by Lord Nicholls of Birkenhead and Lord Walker of Gestingthorpe]
Introduction
This is an appeal from a judgment of the Court of Appeal of New Zealand (Richardson P, Gault, Tipping, McGrath and Anderson JJ) given on 27 March 2002. The Court of Appeal allowed appeals by the Attorney-General of New Zealand from the judgment dated 14 February 2001 of Wild J given in four sets of proceedings which had been heard together. The plaintiffs in two sets of proceedings (156/98 and 359/98) were Waikato Regional Airport Ltd ("WRAL") and in the other two (151/99 and 152/99) South Pacific Air Charters Ltd (trading as Freedom Air – "Freedom") and Palmerston North Airport Ltd ("PNAL"). Wild J granted all the plaintiffs declaratory and other relief against the Attorney-General, sued on behalf of the Director-General of Agriculture and Forestry. The proceedings arose out of two decisions (one taken in 1995 and the other in 1998) by successive Directors-General of Agriculture and Forestry in relation to the recovery under the Biosecurity Act 1993 of costs incurred in biosecurity controls at regional airports in New Zealand.
The background to this litigation involves three main elements: the special importance of biosecurity to New Zealand's national economy, health and quality of life; the "open skies" policy which the governments of New Zealand and Australia agreed to and adopted during the 1990s; and far-reaching changes (starting in the 1980s) in government policy as regards the funding of public services in New Zealand, accompanied by associated changes in the structure and operations of parts of the public sector. These elements were distinct, but they impacted on each other, sometimes with uncomfortable results. In particular (as it will be necessary to examine in much more detail) the approval of regional airports for international flights increased the problems of the Ministry of Agriculture and Forestry ("MAF") and its Director-General ("the Director-General") in administering new legislation at a time when MAF's internal structure was being reorganised, and its workload increased, but funding from central government funds was not proportionately increased.
Biosecurity can be described as protection and remedial action against harmful organisms, including all types of pests and diseases which may infect humans, animals or plant life. One aspect of biosecurity is the maintenance of border controls, in order to provide protection against harmful organisms from outside. It is of particular concern to New Zealand because of the importance to its economy of its pastoral, agricultural and fruit-growing sectors (on the one hand) and of the tourist industry (on the other hand). The aim of the Biosecurity Act 1993 ("the 1993 Act"), which came into force on 1 October 1993, was (as its long title puts it) "to restate and reform the law relating to the exclusion, eradication, and effective management of pests and unwanted organisms".
The 1993 Act is a substantial piece of legislation and is concerned with many matters other than border control (used here to mean control at seaports and airports which are points of first arrival in New Zealand). Its scope appears from the headings to the ten parts of the Act: Part 1 preliminary; Part 2 functions, powers and duties; Part 3 importation of risk goods; Part 4 surveillance and prevention; Part 5 pest management; Part 6 administrative provisions; Part 7 exigency actions; Part 8 enforcement, offences and penalties; Part 9 miscellaneous provisions; and Part 10 savings and transitional provisions. Border controls are provided for in Part 3, the purpose of which is (section 16) "to provide for the effective management of risks associated with the importation of risk goods". Risk goods are defined (section 2) as
"any organism, organic material, or other thing, or substance, that (by reason of its nature, origin, or other relevant factors) it is reasonable to suspect constitutes, harbours, or contains an organism that may –
(a) Cause unwanted harm to natural and physical resources or human health in New Zealand; or
(b) Interfere with the diagnosis, management, or treatment, in New Zealand, of pests or unwanted organisms."
The 1993 Act has been amended by Biosecurity Amendment Acts passed in every year from 1993 to 1999, and by some other enactments, and references to provisions of the 1993 Act are to those provisions as from time to time amended; but neither side suggested that the timing of any of the amendments was directly relevant to the issues on this appeal.
Section 135 of the 1993 Act (in Part 6) is of central importance to this appeal. It provides as follows:
" Options for cost recovery
(1) The Director-General, every other chief executive, and every management agency, (hereafter in this section and in section 136 of this Act referred to as a recovering authority) shall take all reasonable steps to ensure that so much of the costs of administering this Act, including costs incurred as the management agency of a pest management strategy, as are not provided for by money appropriated by Parliament for the purpose are recovered in accordance with the principles of equity and efficiency in accordance with this section and the regulations.
(2) In determining appropriate mechanisms for the recovery of costs of a particular function or service, a recovering authority shall ensure that there is recovered any amount by which —
(a) The sum of —
(i) The costs of the function in the current year; and
(ii) Any shortfall in the recovery of the costs in the preceding year; exceeds
(b) Any over-recovery of costs in respect of the preceding year.
(3) A recovering authority may recover costs of administering this Act and performing the functions, powers, and duties provided for in this Act by such methods as he or she or it believes on reasonable grounds to be the most suitable and equitable in the circumstances, including any one or more of the following methods:
(a) Fixed charges:
(b) Charges fixed on an hourly or other unit basis:
(c) Estimated charges paid before the provision of the service or performance of the function followed by reconciliation and an appropriate payment or refund after provision of the service or performance of the function:
(d) Actual and reasonable charges:
(e) Refundable or non-refundable deposits paid before provision of the service or performance of the function:
(f) Charges imposed on users of services or third parties:
(g) In the case only of the Director-General or some other chief executive, liens on property in the possession of the Crown."
Section 37 provides for the Director-General to approve a seaport or an airport as a place of first arrival in New Zealand, if satisfied that it has appropriate arrangements, facilities and systems. Section 37(4) provides that the requisite arrangements, facilities and systems "are available for use by the Crown at no expense to the Crown". Section 165(1) gives the Governor-General power, by Order in Council, to make regulations for a variety of purposes, including (in para (s)) matters in respect of which costs are recoverable under the Act and the regulations. Section 165(2) (as added by the Biosecurity Amendment Act 1997) requires the responsible Minister to consult before making recommendations for the purposes of section 165(1). The Biosecurity (Costs) Regulations 1993 (SR 1993/368) have been made in relation to costs incurred in connection with the importation of freight of all sorts, but those regulations are largely inapposite to border controls affecting passenger services.
The "open skies" policy was agreed between the governments of Australia and New Zealand in 1992. At that time there were (apart from two RNZAF airfields) three airports in New Zealand licensed and used for international flights. These were (in North Island) Auckland, used for flights to and from Asia and the United States as well as Australia, and Wellington, used (until recently) only for flights to and from Australia; and (in South Island) Christchurch, used for flights to and from Asia and Australia. These three airports have been referred to in argument as the metropolitan airports. They have also sometimes been referred to as the Eighth Schedule airports because they (and the two RNZAF bases) were named in that schedule to the 1993 Act as being approved places of first arrival from the coming into force of the 1993 Act. During 1994 and 1995 four further airports were officially designated as approved places of first arrival under section 37 of the 1993 Act. These were Hamilton, which is fairly close to Auckland, in North Island, and Invercargill, Dunedin and Queenstown in South Island. Palmerston North (which is fairly close to Wellington, in North Island) was similarly approved early in 1996. These five airports have been referred to as the regional airports. Hamilton Airport is run by WRAL and Palmerston North is run by PNAL.
Before 1994 some of the regional airports had occasionally been used for international flights, but only under one-off charter arrangements (for instance skiing parties coming from Sydney to Queenstown, or rugby supporters coming to matches in Dunedin). Special arrangements were made by the New Zealand authorities (including MAF) to recover the costs of clearing these occasional charter flights. The first international...
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