Hawke's Bay and Eastern Fish and Game Councils v Hawke's Bay Regional Council

• Jurisdiction: New Zealand
• Judge: Collins J
• Judgment Date: 12 December 2014
• Neutral Citation: [2014] NZHC 3191
• Docket Number: CIV-2014-441-000073
• Court: High Court
• Date: 12 December 2014

UNDER the Resource Management Act 1991

IN THE MATTER of an appeal from a decision of the Board of Inquiry on the Tukituki Catchment Proposal

BETWEEN

Hawke's Bay and Eastern Fish and Game Councils

Environmental Defence Society Incorporated

Appellants

and

Hawke's Bay Regional Council

First Respondent

Hawke's Bay Regional Investment Company Limited

Second Respondent

IN THE MATTER of an appeal under section 299 and clause 14, First Schedule of the Resource Management Act 1991

BETWEEN

Royal Forest and Bird Protection Society of New Zealand Incorporated

Appellant

and

Hawke's Bay Regional Council

First Respondent

Hawke's Bay Regional Investment Company Limited

Second Respondent

Dairynz Limited Federated Farmers of New Zealand Incorporated Fonterra Co-Operative Group Limited Horticulture New Zealand Incorporated Irrigation New Zealand Incorporated

(Primary Production Interest Group)

Hastings District Council

Section 301 Parties

[2014] NZHC 3191

CIV-2014-441-000073

CIV-2014-485-009279

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

Appeals against the decision a Board of Inquiry (the Board) on managing nitrogen levels in a catchment area — the Board was established to consider and determine proposed changes to a Regional Management Plan and consent applications for a large dam and water storage project — following consultation on its draft report under s149Q Resource Management Act 1991 (RMA) (Board to produce draft report), the Board in its final report redrafted a rule in line with submissions which had been made by the Regional Council — new rule included a factual deeming provision — whether the Regional Council'Xss submissions on the draft report were more than comments on “minor or technical aspects of the [draft] report” as provided by s149Q RMA — whether the Board had been under a duty to re-consult when it adopted the deeming provision — whether the Board properly applied s5(2)(c) RMA (sustainable management — avoiding, remedying, or mitigating any adverse effects) and the Freshwater Policy Statement 2011 — whether the factual deeming provision was lawful.

Counsel:

R J Somerville QC and C D H Malone for Hawke's Bay and Eastern Fish and Game Councils

S Gepp and P D Anderson for Royal Forest and Bird Protection Society of New Zealand

R B Enright and N M de Wit for Environmental Defence Society Incorporated

T P Robinson and M J E Williams for Hawke's Bay Regional Council and Hawke's Bay Regional Investment Company Limited

B J Matheson and D J Minhinnick for DairyNZ Ltd, Federated Farmers of New Zealand Incorporated, Fonterra Co-operative Group Ltd, Horticulture New Zealand Incorporated and Irrigation New Zealand Incorporated

M E Casey QC for Hastings District Council

JUDGMENT OF Collins J

Introduction

1 This judgment answers appeals on questions of law brought by Hawke's Bay and Eastern Fish and Game Councils (Fish and Game), Royal Forest and Bird Protection Society of New Zealand Incorporated (Forest and Bird) and cross-appeals by Environmental Defence Society Incorporated (Environmental Defence). These organisations have challenged an important aspect of a decision of a Board of Inquiry (the Board) established by the Minister for the Environment and the Minister for Conservation pursuant to s 147 of the Resource Management Act 1991 (RMA).

2 The Board was established to consider and determine proposed changes to the Hawke's Bay Regional Management Plan — Tukituki Catchment (the Regional Plan) and consent applications for a large dam and water storage project called the Ruataniwha Water Storage Scheme. The proposed changes to the Regional Plan were promoted by the Hawke's Bay Regional Council (Regional Council). The consent applications were sought by the Hawke's Bay Regional Investment Company Ltd (Investment Company) a wholly-owned subsidiary of the Regional Council.

3 Twelve questions of law have been advanced by Fish and Game, Forest and Bird and Environmental Defence. Their appeals and cross-appeals have been opposed by the Regional Council, the Investment Company, the Primary Production Interest Group 1 and the Hastings District Council.

4 The common theme to all questions of law is the Board's approach to managing nitrogen levels in the Tukituki Catchment Area (Catchment Area). I have concluded the Board did make errors of law when it constructed a factual deeming provision in a rule in the Regional Plan. The rule in question is Rule TT1(j) which applies to farms larger than four hectares.

5 In the Board's draft report, farms covered by Rule TT1(j) would require resource consents if they caused or contributed to excesses of specified levels of dissolved inorganic nitrogen (DIN) 2 entering the Catchment Area. The Board received submissions from the parties on its draft report.

6 In the Board's final report, Rule TT1(j) was changed so that farms covered by the rule are deemed not to be contributing to the specified levels of DIN entering the Catchment Area if the farm complies with nitrogen leaching rates specified in a different rule.

7 This change produced two overarching errors of law. First, the factual deeming provision was not suggested by any party and was devised by the Board without consultation in circumstances in which the Board had a duty to re-consult the parties about the contents of Rule TT1(j).

8 Second, an effect of the Board's factual deeming provision in Rule TT1(j) is that the Regional Council will lose an important tool in its management of the amount of DIN that enters significant portions of the Catchment Area. I have concluded the factual deeming provision in Rule TT1(j) does not avoid, remedy or mitigate the adverse effects of activities on the environment 3 or give effect to the National Freshwater Policy Statement 2011. 4

9 The effect of my judgment is that the Board will need to reconsider Rule TT1(j) and devise an appropriate mechanism for monitoring the amount of DIN that enters the Catchment Area. The Board will also have to reconsider its terms of consent for the Ruataniwha Water Storage Scheme.

10 In concluding that the Board made errors of law in relation to Rule TT1(j) I am mindful the Board was working under extreme pressures. 5 Requiring the Board to reconsider Rule TT1(j) will not necessarily cause significant delays to the Ruataniwha Water Storage Scheme.

11 To help understand my reasons I have divided this judgment into the following parts:

PART I

BACKGROUND

PART II JURISDICTION AND PROCEDURE

PART III

RULE TT1(j)

PART IV

OBJECTIVE TT1(f)

PART V

RUATANIWHA WATER STORAGE SCHEME

PART VI

CONCLUSIONS

12 The reference in Part IV to Objective TT1(f) is to an objective contained in the Regional Plan that was the subject of a cross-appeal advanced by Environmental Defence.

PART 1

BACKGROUND

The Catchment Area

13 The headwaters of the Tukituki, Waipawa and Makaroro Rivers are on the eastern flanks of the Ruahine Ranges. These rivers, and other smaller rivers and streams cross the Ruataniwha Plains to the west of Waipukurau and merge into the Tukituki River at a point approximately eight kilometres east of Waipukurau. From there the Tukituki River continues its journey and enters the Pacific Ocean east of Hastings.

14 There are three distinct zones within the Catchment Area:

• (1) The area from the headwaters to the Ruataniwha Plains is used for pastoral farming and forestry.

• (2) The Ruataniwha Plains and areas further down the Catchment Area are used for more intensive farming, including some dairy farming, orcharding and horticulture enterprises.

• (3) The third zone comprises part of the Heretaunga Plains, which are located along the final 25 kilometres of the Tukituki River. This area is used for horticulture and viticulture.

15 Of the Catchment Area that is currently used for farming and forestry purposes approximately 74 per cent is used for sheep and dairy farms, 18 per cent for forestry, five per cent for arable farming and less than one per cent for orchards and viticulture.

16 Beneath the Ruataniwha Plains lies an aquifer which is a multi-layered system covering approximately 800 square kilometres. It is estimated that this aquifer system contains about eight billion cubic metres of water.

17 Most of the water in the Ruataniwha basin aquifer leaves the basin through the rivers and streams on the basin's eastern boundary.

Irrigation

18 In 1990 approximately three million cubic metres of water was extracted from the Ruataniwha aquifer system. Today approximately 25 million cubic metres is extracted each year from that aquifer system and is used to irrigate approximately 7,000 hectares.

19 There are 272 consents authorising the extraction of water in the Catchment Area. Of these, 174 authorised the extraction of ground water. The other 98 consents authorised the extraction of surface water.

Resource concerns

20 By 2008 the Regional Council had become concerned about a number of issues relating to water allocation, water quality and the management of water resources within the Catchment Area. Specifically, the Regional Council was concerned about:

• (1) over-allocation of surface water within the Catchment Area;

• (2) a lack of information about ground and surface water connections;

• (3) the impacts of drought on irrigation schemes; and

• (4) the excessive growth of algae and slime in the middle and lower reaches of the Tukituki River which was impacting on fish and recreational uses of the Tukituki River.

Water quality

21 The appeal before me focused on the steps taken by the Board to address the quality of water in the Catchment Area.

22 A feature of parts of the Catchment Area has been an increase of periphyton which is “a complex mixture of algae and slimes that attach to submerged surfaces in rivers”. 6 Periphyton occurs naturally in rivers and is an integral part of a healthy river ecosystem. Excessive quantities of periphyton alter the...