Sustain Our Sounds Incorporated v The New Zealand King Salmon Company Ltd

• Jurisdiction: New Zealand
• Judge: Glazebrook J
• Judgment Date: 17 April 2014
• Neutral Citation: [2014] NZSC 40
• Docket Number: SC 84/2013
• Court: Supreme Court
• Date: 17 April 2014

BETWEEN

Sustain Our Sounds Incorporated

Appellant

and

The New Zealand King Salmon Company Limited

First Respondent

Environmental Defence Society Incorporated

Second Respondent

Marlborough District Council

Third Respondent

Minister of Conservation and Director-General of Ministry for Primary Industries

Fourth Respondents

[2014] NZSC 40

Court:

Elias CJ, McGrath, William Young, Glazebrook and Arnold JJ

SC 84/2013

IN THE SUPREME COURT OF NEW ZEALAND

Appeal from a decision which allowed plan changes and resource consents for three salmon farms in the Marlborough Sounds — Minister of Conservation referred the matter to a Board of Inquiry — Board had concerns in respect of water quality matters — determined the matter on an adaptive management approach to make the Resource Management Act 1993 (RMA) workable and to give effect to s5 RMA (purpose — to promote sustainable management) stated that adaptive management approach arose in part from the precautionary approach which it described as being “inherent in the RMA” — whether an adaptive management approach was consistent with a precautionary approach — whether the plan changes were improperly predicated on the consent conditions — whether the parameters of the adaptive management regime (if available) should have been contained in the plan rather than through consent conditions.

Counsel:

M S R Palmer and K R M Littlejohn for Appellant

D A Nolan, J D K Gardner-Hopkins, D J Minhinnick and A S Butler for First Respondent

D A Kirkpatrick, R B Enright and N M de Wit for Second Respondent

C R Gwyn and E M Jamieson for Fourth Respondents

P T Beverley and D G Allen for the Board of Enquiry

• A The appeal with regard to the Waitata, Richmond and Ngamahau sites is dismissed.

• B Costs are reserved.

JUDGMENT OF THE COURT

REASONS

(Given by Glazebrook J)

Table of Contents

	Para No
Introduction	[1]
The water quality issue	[8]
The statutory framework	[14]
The New Zealand Coastal Policy Statement	[20]
The Marlborough Regional Policy Statement	[26]
The Sounds Plan	[33]
Plan change approved by the Board	[40]
Evidence and findings on water quality	[42]
Harmful algal blooms	[50]
Cumulative effects	[52]
Mitigation	[55]
Overall conclusion on effects on the water column	[56]
Board's approach to the plan change	[59]
Port Gore	[63]
Waitata Reach	[64]
Queen Charlotte Sounds and Tory Channel	[69]
Assessment approach	[70]
The consents	[75]
Modification of consent conditions in course of hearing	[76]
Overall decisions on consents	[84]
Consent conditions	[88]
The issues	[94]
Adaptive management	[95]
The parties' submissions	[96]
Precautionary approach under the Coastal Policy Statement	[100]
Board's consideration of the precautionary approach and adaptive management	[102]
Guidance notes on the Coastal Policy Statement	[107]
International commentary	[109]
New Zealand cases	[113]
Australian cases	[117]
Canadian cases	[122]
Was an adaptive management approach available in this case?	[124]
Relationship between the plan change and consent applications	[141]
The parties' submissions	[141]
Discussion	[143]
What should have been contained in the plan?	[148]
The parties' submissions	[148]
Discussion	[151]
Conclusion, result and costs	[159]

Introduction

1 New Zealand King Salmon applied to establish nine new salmon farms in the Marlborough Sounds. Under the Marlborough District Council's combined Regional, District and Coastal Plan (the “Sounds Plan”), 1 the Coastal Marine Area in the Marlborough Sounds is divided into two zones: Coastal Marine Zone 1 where marine farms are prohibited and Coastal Marine Zone 2 where marine farming is usually a discretionary activity. With regard to eight of the sites, the application asked for a plan change so that these sites would be re-zoned to a new zone, Coastal Marine Zone 3, where the farming of salmon would be a discretionary (rather than prohibited) activity. Resource consents for the salmon farms at those eight sites were also sought. In addition, there was a separate resource consent application for the White Horse Rock site, which was situated in Zone 2.

2 King Salmon's requested sites for spot zoning changes were in three different areas of the Sounds. Four were in Waitata Reach in Pelorus Sound: Waitata, Kaitira, Tapipi and Richmond. The White Horse Rock site was also in Waitata Reach. King Salmon requested its largest site, referred to as Papatua, in Port Gore in the outer Sounds. In Queen Charlotte Sound, the requested sites were at Kaitapeha and Ruaomoko. The final site was on the western shores of the Tory Channel, at Ngamahau. 2

3 The applications for the plan changes and the consents were referred by the Minister of Conservation 3 to a Board of Inquiry chaired by retired Environment Court Judge Whiting on 3 November 2011 4 and were heard and considered at the same time. 5 The Board granted plan changes in relation to four of the proposed sites

(Papatua, Ngamahau, Waitata and Richmond). This meant that salmon farming became a discretionary rather than prohibited activity at those sites. 6 Resource consents were also granted for those four sites, subject to detailed conditions of consent that were designed to monitor and address adverse effects under an adaptive management approach. 7 The application for consent for the White Horse Rock site was declined

4 Sustain Our Sounds Inc (SOS) appealed to the High Court 8 against the Board's decision on all four sites, primarily on issues relating to water quality. That appeal, and an appeal by the Environmental Defence Society (EDS) in relation to the Papatua and Waitata sites only, was dismissed by Dobson J on 8 August 2013. 9 Both SOS and EDS were granted leave to appeal to this Court 10 against Dobson J's decision 11 and the appeals were heard together. In a judgment on the EDS appeal, released at the same time as this judgment, the EDS appeal with regard to the Papatua site in Port Gore has been allowed. 12 In practical terms, this means that the SOS appeal now relates to the three remaining sites. 13

5 As indicated, SOS challenges the Board's decision with regard to all four sites. This is on the basis that there was inadequate information on water quality issues before the Board to enable it to grant the applications for plan changes at all

and particularly at the maximum feed levels. Although there had been modelling of the effects on water quality at the maximum initial feed levels, there had been none at the maximum feed levels. (The application envisaged a process whereby feed levels could be raised over time up to a ceiling maximum feed level.) Even at the initial feed levels, however, it is submitted that there was insufficient baseline information to rely on the modelling of the maximum initial feed levels, without rectifying the information deficit. In addition, SOS submits that the Board was wrongly influenced by the adaptive management measures contained in the resource consents in deciding to make the plan changes and that, even if an adaptive management approach was available, the parameters of that approach should have been in the plan and not the resource consents

6 The SOS submissions therefore raise three broad issues:

• (a) whether the adaptive management approach that the Board took was available;

• (b) whether the Board's decision on the plan changes was wrongly predicated on the consent conditions; and

• (c) if an adaptive management approach was available, whether that should have been contained in the plan as against the consents.

7 In order to put these issues and the SOS submissions in context, we first explain the water quality issue in more detail and then set out the statutory framework applicable to this appeal, including the relevant provisions of the New Zealand Coastal Policy Statement, the Marlborough Regional Policy Statement and the Sounds Plan. After this, we give more detail on the plan change approved by the Board, outline the evidence before and the findings of the Board on water quality and summarise the Board's approach to the plan change. We then summarise the decision on the consent applications, set out the conditions of consent for the four sites that were approved and discuss the modifications made in the course of the hearing to the consent conditions as originally proposed by King Salmon.

The water quality issue

8 The trophic state of bodies of water is indicative of their biological productivity (that is, water quality). The quantities of particular nutrients in water, including nitrogen, are the primary determinants of a body of water's trophic state. The five trophic states are microtrophic (least productive), oligotrophic, mesotrophic, eutrophic and hypertrophic. 14 Typical water column characteristics for the different trophic states, as measured by total nitrogen, total phosphorus, water clarity and chlorophyll- a, were set out by the Board in its decision. 15

9 The classifications of trophic level are broad and there had been discussion among the expert witnesses as to the proper classification of the Sounds as a whole. 16 The concentrations of nitrogen in the Sounds are currently at the oligotrophic end of the spectrum, while chlorophyll- a levels are within the levels indicative of a mesotrophic state. It appears, too, that there may be seasonal variations in trophic levels, due to natural fluctuations in nutrient inputs and flushing. 17

10 It was accepted by the Board that a change from the current trophic state of the Sounds from a oligotrophic/mesotrophic to an eutrophic state “would represent an ecological disaster with significant...