A quarry owner’s two-decade legal battle with Whangārei District Council over alleged negligence has largely ended in defeat after the Supreme Court set aside the $4.2 million in damages he had earlier been granted.

Malcolm James (Jimmy) Daisley has been in a fight with the council (WDC) over his commercial aggregate quarry in Knight Rd, near Whangārei.

At one stage, Daisley was awarded $4.2m from the High Court for negligence and misfeasance in public office. The High Court had found the council was negligent.

The council then appealed to the Court of Appeal, which largely upheld the damages but modified some findings. The council, through its insurers, appealed to the Supreme Court, which released its decision last week.

The judgment, from five Supreme Court justices, set aside the damages award and instead granted Daisley $90,000 for loss of value of the Knight Rd property. It ruled his primary negligence claim was filed outside statutory time limits, meaning the damages award could not stand. It also ordered Daisley to pay WDC $45,000 in legal costs.

Daisley told the Northern Advocate he was disappointed with the decision, saying the case had a big impact on his life over the past two decades.

He found the ruling “hard to believe”, saying it meant the $4.2m already paid will now be recoverable, with a large portion already absorbed by legal costs.

Daisley was still deciding if and what could be done next.

WDC said in a statement that the long-running matter has been handled by its insurer, Riskpool, under the terms of its insurance arrangements.

“All legal and associated costs of the proceedings, including appeals, have been met by the insurer, with council’s financial contribution limited to the policy excess.”

The council said it had followed insurer and legal advice to ensure compliance with policy conditions.

It will now be up to the insurer to pursue Daisley to recover the damages compensation that had already been paid out.

Jimmy Daisley spent more than 20 years fighting Whangārei District Council after its mistakes led to him selling his quarrying property. The Supreme Court has now ended the case by slashing his earlier $4.2 million in damages to $90,000

In 2004, Daisley ventured into quarrying when he purchased a quarry alongside a farm on Knight Rd. The sellers assured Daisley the quarry operations had faced no challenges or prohibitions until then. However, in November 2004, the council issued a Land Information Memorandum mistakenly stating that no resource consent had been issued for the quarry.

From 2005, the council denied the existence of any consent, claiming the quarry operations, which had been running for almost 30 years, were unauthorised and unlawful.

Caught in a legal quagmire, the council sent Daisley abatement and infringement notices, followed by enforcement actions in the Environment Court for alleged breaches of these notices.

Undeterred, Daisley sought to regulate his operations by applying for resource consent in 2006. His efforts were met with resistance from the council, which continued its enforcement actions.

The turning point came in 2009 when Daisley’s solicitor discovered a land use consent for the quarry issued in February 1988. This was the first time Daisley became aware of its existence.

Facing the threat of a mortgagee sale, Daisley sold the farm in 2009 to his neighbours at what he said was a “forced sale” price.

In 2011, after a prolonged legal battle, the council acknowledged Daisley did possess the necessary consent to operate the quarry. The enforcement proceedings were withdrawn.

Daisley, describing himself as traumatised by “17 years of hell”, took the council to court alleging negligence and misfeasance in public office for knowingly and deceptively denying the existence of a valid consent.

The High Court awarded Daisley $4,279,622 in damages, with interest continuing to accrue daily. Included was $50,000 in exemplary damages. The court also granted his request for a sale order on 2.387ha of land that Forum North sits on in Rust Ave to repay the multimillion-dollar debt the council owes him.

The council appealed in 2022, and a hearing was held in late 2023. The Court of Appeal decision made a slight adjustment to the High Court ruling.

The appeal court found no current council officers knew of the 1988 land use consent, so they could not have wilfully concealed it.

However, the officers were deemed reckless for not searching council records before taking enforcement action against Daisley, despite credible indications a consent might exist.

Consequently, the appeal court set aside the finding of liability for misfeasance and the award of exemplary damages, $50,000, but ruled the council is still liable for the damages. The Supreme Court ruling has now overturned that position.