What is subdivision?

Subdivision is essentially a process of dividing a parcel of land or a building into one or more further parcels, or changing an existing boundary location. Although subdivision does not itself alter the way land is used, those who subdivide land will almost inevitably be doing so to alter the land use. Subdivision is a very convenient time to address environmental impacts of intensification and change in land use, as it can be inefficient to impose controls through separate consents at a later stage.

Land subdivision creates separate and saleable certificates of title, which can define an existing interest in land (including buildings) and impose limitations on landowners or occupiers for how the land can be used or developed, through conditions and consent notices imposed under s108 and 220 of RMA. Subdivision also provides the opportunity for a council to require land to be vested and reserve and other financial contributions to be taken to provide necessary infrastructure.

Land is usually subdivided for one of the following purposes:

• to provide a legal title to an existing development with limited or no potential for further development (e.g. subdivisions around existing buildings, or boundary adjustments)
• to provide title to sites that have few or no adverse effects at the time of subdivision, but with a presumption that development (which may have effects) will follow subdivision (e.g. infill subdivisions)
• for large-scale development where substantial works are carried out as part of the subdivision and where adverse effects can and do occur (e.g. greenfield subdivisions). Land in New Zealand is owned in two different ways and these affect the way land is subdivided; freehold and leasehold.

Subdivision under the RMA

Land subdivision under the RMA includes:

• the creation of separate fee-simple allotments with new certificates of title (freehold)
• the lease of land or buildings or both for 35 years or longer (leasehold)
• the creation of a unit title, company lease, or cross-lease.

Under the s11, no person may subdivide land unless the subdivision is expressly allowed by a rule in a plan or a resource consent, and a survey plan has been processed under Part 10 of the Act.

The critical definitions that relate to this process are:

• the subdivision of land (as defined by s218)
• an allotment
• the survey plan.

However, there are a number of exemptions from these provisions, which means that not all subdivisions are subject to the RMA.

RMA subdivision provisions generally do not apply to the subdivision of Māori land unless land is proposed for sale outside of the hapū. The other exemptions are outlined in s11(1)(b) - (d), and include subdivisions:

• to acquire, take, transfer or dispose of land under the Public Works Act 1981
• to establish, change, or cancel a reserve under s338 of the Te Ture Whenua Māori Act 1993
• to transfer or resume land under either s23 or s27D of the State Owned Enterprises Act 1986
• to vest, transfer or gift land to the Crown or any local authority, New Zealand Historic Places Trust or the Queen Elizabeth II National Trust
• to transfer, exchange, or otherwise dispose of land made by an order under subpart 3 of Part 6 of the Property Law Act 2007, relating to the granting of access to land-locked land.

The subdivision process

The process of subdivision involves several stages as indicated in following Figure 1. The first four stages are primarily under the jurisdiction of the RMA. The process of gaining a subdivision consent is no different to obtaining a land-use consent, requiring both an assessment of the application, determination on notification, and a final decision.

Figure 1: Process of subdivision

Gaining a subdivision resource consent

Very few district plans provide for subdivision as a permitted activity, and even then s223(1)(b) (Approval of survey plan by territorial authority) requires that a certificate of compliance first be obtained under s139 of the Act. An application for a subdivision consent needs to be accompanied by a subdivision (also called "scheme") plan, together with an explanatory report, which will include any information required by the district plan. As with any resource consent application, an assessment of effects on the environment is also required. In addition, Form 9 of the RMA lists specific information required to be lodged as part of a subdivision consent application.

The subdivision application will be assessed by the territorial authority in accordance with the relevant provisions of the district plan and the RMA. Subdivisions that involve significant earthworks, discharges and/or diversions of watercourses may require consents from the regional council. In these cases, it is common for councils to work together with the applicant, either informally or formally, in the processing of the subdivision consent. In some situations, either the notification or consideration of an application may be deferred under s91 until an application for the regional consents is made. A joint hearing may also be considered necessary (s102).

Conditions of subdivision consent may be imposed under s108 (Conditions of resource consents) and 220 (Conditions of subdivision consents). For most subdivisions, these will be based on matters outlined in the district plan.

Works carried out/conditions of approval met

The second stage of subdivision involves the consent holder complying with the conditions of subdivision consent. This typically includes the payment of any financial or development contributions, design and approval of the engineering details by the council, and completing the physical works such as the provision of roading, water supply, earthworks and drainage.

During this period a licensed cadastral surveyor will define the allotments and prepare the title plan for submission to the council and lodgement with Land Information New Zealand.

Approval of the survey plan (including any endorsements) by the territorial authority

This stage involves approval of the survey plan by the territorial authority prior to approval and deposit by Land Information New Zealand.

The plan is submitted to the council under s223 for checking that it conforms with the subdivision consent. Council has 10 days to either approve or decline the plan under s223(1A). It must ensure that the subdivision layout and provisions are correct and that all conditions of the consent have been (or will be) satisfied. Conditions may include matters such as required construction activities, vesting of lands for roads and reserves, payment of financial or development contributions, amalgamation of allotments, protection of land against erosion, granting or reserving of easements, and registration of bonds or consent notices for securing conditions of a continuing nature.

At this stage, the council may approve the plan under s223 notwithstanding that some or all conditions of subdivision consent have not yet been satisfied. The council certificate may be endorsed on either the plan or a copy, or on an accompanying document appropriately linked to the plan. The certificate must be signed by the chief executive or an authorised officer of the council.

To allow the survey plan to be deposited with the Registrar General of Land, the council is further required under s224(c) to provide a certificate (on the plan or a document signed similarly as for the s223 certificate) stating that all or any of the conditions of the subdivision consent have been complied with to its satisfaction. For any condition that has not been complied with, the s223 certificate must note that one or more of the following relevant actions has been taken:

• a completion certificate (s222) has been issued;
• a consent notice (s221) has been issued;
• a bond (s108(2)(b)) has been entered into by the subdividing owner.

The two certificates may also be combined into one statement and duly signed.

The plan and appropriate documentation are then ready for lodgement with Land Information New Zealand for approval, deposit, registration and issue of new titles.

Approval and deposit by Land Information New Zealand

The final stage of subdivision involves survey plan approval and deposit by Land Information New Zealand and cannot be fully executed unless the plan is accompanied by the required s223 and 224(c) certificates and all necessary documents for registration as required by s224.

The plan may be lodged as either a traditional hard copy or as electronic data. It is processed to check the definition of land boundaries and validate that it correctly fits into the national cadastral database (called Landonline). Once the plan has been assessed as correct, the plan is ‘Approved as to Survey’ under the Cadastral Survey Act 2002.

It then remains in Landonline while it is examined for title purposes as to all documentation having been lodged (including an application for new titles) and in correct format for registration. Once all matters are in order the plan is deposited by Land Information New Zealand and fully merged into Landonline to become part of the updated cadastre. New titles are finally issued under the Land Transfer Act 1952 (or the Unit Titles Act 2010).

If any of the above matters cannot be properly dealt with the plan cannot deposit. In that case there is a maximum period of three years from the date of the s223 approval for issues to be resolved and the plan to subsequently be deposited (s224(h)).

Differences between subdivision and land use

The fundamental difference is that subdivision cannot be carried out unless it is "expressly allowed by a rule in a plan or a resource consent" (s11 of the RMA), whereas land-use activities are permitted unless otherwise provided for in plans (or resource consents) (s9).

The key differences for councils between managing subdivision and land use include the following:

• Information requirements for subdivision consents in a district plan will usually be more extensive, particularly regarding infrastructure and engineering matters. An application for a subdivision consent will often involve the assessment of technical matters such as services and reserve contributions, and other financial contributions. This usually involves specialist advice from surveyors and engineers (both internal and external to council), recreation / open space planners, etc.
• Section 220 provides a specific list of conditions that can be included on a subdivision consent, in addition to the general conditions on all resource consents under s108.
• An applicant can only apply to change or cancel the conditions of a subdivision consent, with the exception of a condition relating to the duration of the consent, prior to the deposit of the survey plan under s223 (s.127(1) (a)).
• An applicant can apply to change or cancel any condition specified in a consent notice after the deposit of the survey plan (s221(3)). The provisions of ss88 to 121, and 127(4) to 132 apply to any application to vary or cancel a consent notice, or for the consent authority to review a consent notice.
• Esplanade reserves must vest upon subdivision (under specified circumstances described in s230, unless the district plan or a resource consent provides otherwise).
• The conditions associated with subdivision consents are generally staged or have more options for the applicant to bond or secure compliance to allow the subdivision to proceed, such as through completion certificates (s222), consent notices (s221) and bonds (under s108(2)(b)).
• Most subdivisions will involve some form of easements, covenants and rights-of-way
• Conditions must be finite so that they are able to be completed to obtain a s224(c) certificate. However, for a condition to be complied with on a continuing basis by the subdividing owner, a consent notice is required.

Good practice tips

Subdivision and land-use applications for the same development site should normally be treated together, to ensure that all potential effects associated with a proposal are assessed.

Whether dealing with a subdivision consent, a land-use consent or a joint consent, it is important that you read any certificates of title to ensure that you are fully informed about all the particulars relating to the site(s).

A further important difference between subdivision and land uses is that subdivisions will often involve a significant contribution in land and infrastructure that becomes publicly owned after the subdivision has occurred.

The general costs associated with subdivision are also different to those associated with land-use consents. Carrying out a subdivision has a number of costs that are not always readily apparent.

These costs would generally include:

• council fees for the subdivision consent application and ss223 and 224 certificates
• council fees for engineering approval and works supervision
• council fees for any associated land-use consent
• connection to the public infrastructure network (serviced site)
• extending services for upstream catchments (serviced site)
• extensions or improvements of the public infrastructure network necessary to serve the subdivision (serviced site)
• constructing and maintaining on-site disposal systems (un-serviced site)
• obtaining a valuation for assessing the reserve contribution
• financial or development contributions (eg, road and reserve contributions and public services upgrading contributions)
• consultant fees (surveyors, engineers, planning consultants, landscape architects)
• solicitor (council's and applicant's) fees for consent notices, drainage easements, and bond documents
• construction of engineering works, such as driveways, roads, services, etc.
• costs associated with resource consent conditions, such as protecting areas of native vegetation
• fees charged by Land Information New Zealand for plan approval and deposit, and issue of new titles.