New supermarket can't open, court rules

The partially-built Pak'N Save supermarket on Wairau Rd yesterday. Picture / Dean Purcell

An almost-completed Pak'N Save supermarket in Auckland cannot open, after a court overturned its resource consent.

Supermarket owner and operator Foodstuffs has been fighting for 18 years to build the store on Wairau Rd, on the North Shore, and was ready to open the doors in August. The main structure of the building went up weeks ago and roadworks to improve traffic flows around the site, where a new fire station is also planned, are under way.

But Rival supermarket owner Progressive Enterprises took Pak'N Save owner The National Trading Company of New Zealand - a Foodstuffs (Auckland) subsidiary - to court, with the North Shore City Council, to block the project.

Progressive, owner of the Foodtown, Woolworths and Countdown supermarket chains, joined business group Northcote Mainstreet Inc in the action and won. Justice David Baragwanath ruled in the High Court at Auckland that the council was wrong not to notify the application to build the supermarket and its decision to grant permission for the building was invalid.

Foodstuffs made an application to the council in January last year for a 4899sq m supermarket. The council appointed a panel of five independent commissioners to consider the application. By August, the council had granted Foodstuffs' application not to notify its resource consent application and work started on the site.

A senior council planner told the commissioners that the effects of the new supermarket on existing centres in the area would be no more than minor. The supermarket was projected to generate between $53 million and $70 million annually.

In his decision, Justice Baragwanath cited the roading network in the area, which he said was "already loaded over capacity". He referred to the consequences of adding supermarket traffic to the existing roading problems as being cumulative. The council had erred in not awaiting the results of full investigations by Transit NZ, which in October had sought adequate time to reassess the situation. Transit's involvement in the decision to allow the supermarket to be built was "imperative".

The council did not adhere to its undertaking to defer considering Foodstuff's application to develop until Transit had been fully consulted and formed its view.

"Instead, in the face of Transit's explicit request on October 19 for adequate time to reassess what it described as 'the apparent deficiencies in the traffic reports reviewed to date', it went ahead with its decision-making the very next day," the judge wrote of the council's actions.

He also cited issues at the centre of another legal wrangle over a major North Shore property development - Discount Brands' fight to open its Fox Outlet shopping centre at Northcote in the face of legal challenges from mall owner and operator Westfield.

After High Court, Court of Appeal and Supreme Court hearings between the parties, Westfield won its fight against Fox, but Fox is continuing to operate under a second resource consent it had obtained before the Supreme Court hearing this year.

Like the supermarket case, the Fox case also involved Northcote Mainstreet and North Shore City Council.

Justice Baragwanath found the adverse effects of the Pak'N Save supermarket "may well be more than minor" and ruled in favour of Progressive.

Murray Jordan, Foodstuffs general manager of property strategy, said yesterday he was "extremely surprised and disappointed". Foodstuffs was considering its options, including appealing the decision.

He said the supermarket would save people in the southern part of the North Shore $3 million to $4 million on their annual grocery bills.

"It's taken 18 years for us to try and get this supermarket open and, at every turn, our competitor has used spoiling tactics to try and block it.

"Challenging our consent was an attempt to stymie our development but we haven't given up on getting a new supermarket option for the local area."

But Progressive's general manager of property, Adrian Walker, rejected the criticism, saying the court had simply upheld his company's assertions that there were matters which had to be addressed.