Established as a lobby group to hold Far North District Council to account over its establishment of heritage areas, forty-four members of Far North Community Group were ordered jointly to contribute $10,000 towards Council legal costs after failure of an ill-fated Environment Court challenge.
Belatedly recognising the prospect of potential personal liability, the group later formed an incorporated society to progress their legal challenge. They were still liable for costs up to the point their incorporated society was substituted as applicant in their Environment Court litigation.
Property owners from around Mangonui challenged Far North District rules seeking to preserve examples of early colonial architecture and to allow archeological digs over private property in areas considered to be of heritage status.
In the Environment Court, a ginger group challenged operation of these rules.
It did not go well.
The Environment Court was critical of filed documents as being unclear, unstructured and convoluted.
It was suggested to the applicants that they might reconsider their proposed challenge.
The court signalled part of their application lacked merit; in other instances, they were asking for court orders the Environment Court has no power to make.
After they pressed on, it became clear the Environment Court would not rule in their favour, with the possibility of costs awarded against them.
Unlike the High Court, it is not normal practice for the Environment Court to award costs in favour of a successful litigant; costs paid by the losing side.
But costs may be awarded against Environment Court litigants who fail to follow mandated court practice; wasting court time, imposing extra costs on other litigants.
Judge Smith ordered forty-four named members of the original ginger group pay $10,000 to Far North District; just under half Council’s legal costs up to the point this group exited the litigation, replaced, as approved by the Court, with their newly registered Far North Community Group Incorporated.
An incorporated society is a legal person, separate from its members.
This incorporated society is now their vehicle for any further litigation and is itself liable for any further costs order.
Later substitution by the Far North Community Group Inc did not absolve individual members from their liability incurred prior to incorporation, Judge Smith ruled.
Far North Community Group Inc v. Far North District Council – Environment Court (12.01.26)
26.061