A serious council blunder has cost Napier ratepayers more than $55,000, and may yet see the council back in court to pay more.
The costs were the fallout from staff's failure to properly assess a resource consent application and granting consent for the construction of seven houses for mentally ill people on Napier Hill.
Residents opposed to the proposal had the consent cancelled in a successful High Court judicial review, and recently won costs.
All up, the legal and consent processing costs have been $55,237.50.
But it may not end there, with Whatever It Takes Trust Incorporated saying it invested in land and plans for the site only because of the council's decision to grant consent.
It has spent more than $500,000 on the project. The council had refunded $95,000 of the $110,321 the trust paid for a building consent in the weeks before the judicial review, and council chief executive Wayne Jack says it will refund a further $11,871 in September. But trust general manager Caroline Lampp said the trust had not ruled out taking legal action against the council to recoup some of the cost of buying the land, and other costs.
The trust was no longer intending to build on the site and was looking at where it might build to provide housing for its clients.
Lampp said the trust would still be "hugely out of pocket" even if it could sell the site - "and we'll never get it all back".
The High Court's decision to make the trust and council each pay half the opponents' costs was "peculiar" as it was the council's responsibility to ensure it had all the information required before granting a consent.
"Clearly they [council] felt they had enough information and granted it," Lampp said.
The court found the council had acted unreasonably, had made serious errors and the application for the seven units, housing 14 mentally ill people, should have been publicly notified, as opponents claimed. Justice Ailsa Duffy said the council's error was "serious and more than just technical defects of no possible consequences".
The residents, Janet MacPherson and Neil Matheson, were recently awarded costs of the judicial review, with the council and the trust each paying $14,485.
Matheson said there were no winners, but the blame must fall at the feet of the council, which approved a consent it should not have.
"I couldn't believe the council even accepted the application form. The assessment of effects form wasn't filled out correctly and wasn't even signed," he said.
"We just couldn't figure out how that could have been accepted. If the council was a private company, heads would have rolled. It's just a fiasco. Nothing that happened will give anyone any confidence they could get it right.
"I'm not in favour of amalgamation [of Napier and Hastings councils], but if it would sort this sort of thing out, then I'm all for it."
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