"Wanganui District Council refused consent [to pull down the building] and this was subsequently appealed by the applicant. The appeal was heard in the Environment Court and declined."
Principal planner Jonathan Barrett told councillors the Environment Court declined the application because UCOL and Te Puna had not made clear how they would use the land.
"This time the application is more detailed and clear," Mr Barrett said.
Mayor Annette Main noted that the building had an unusual heritage value.
"It's not the building itself that is of particular value, it's what the building was used for."
Ms Main said it was the only purpose-built Native Land Court building in New Zealand that was still standing.
However, she said local iwi were adamant they wanted the building gone because of its connections to colonisation.
Councillor Michael Laws asked if the council could negotiate between the Whanganui Regional Heritage Trust and Historic Places Trust, who want the building to remain, and Te Puna and UCOL. Ms Main said she did not think that would be possible.
After some discussion, councillors decided to refer the application directly to the Environment Court.