Abatal Ltd v Waitakere City Council - A24/02, Chamber J, HC - Auckland Registry, 5 July 2002. 

On 28 June 2002 the Auckland High Court heard an appeal by Abatal Ltd against sentence. Abatal appealed a fine of $20,000 for an offence under the Building Act.

The offence related to the construction a large greenhouse, approximately 5,400m2 in size, built without a building consent. Abatal Ltd and its director James Pike had pleaded guilty to charges under s.80(1)(a) of the Building Act. Abatal Ltd was sentenced $20,000 and Mr Pike was sentenced to pay a fine of an additional $5,000. Only Abatal Ltd appealed its sentence in this case.

In upholding the District Court decision, Justice Chambers stated that the crucial feature in this case was the need for deterrence. The High Court noted the comments in the leading authority of Wilson v Fowler that:

"The scale of penalties available is such that fines which amount to no more than a licence fee do not properly reflect the will of Parliament."

Justice Chambers accepted that there was a "real financial incentive to cut corners and proceed without a building consent" and that "in circumstances such as these, there is a real risk that fines, unless substantial, have no deterrent effect at all and instead come to be considered, by business people in particular, as no more than licence fees."

The High Court also held that the District Court had properly considered the appellant's culpability, its director having obtained a building consent for a greenhouse in the past.

This case is notable as the largest fine under the Building Act confirmed by the High Court and the Court's consideration of the deterrent required to ensure that business entities did not enjoy a commercial benefit by avoiding their Building Act obligations.

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