A Supreme Court case threatens one of the country’s most important environment-related precedents. David Williams reports
In the labyrinthine tangle of New Zealand planning law it might not be a surprise there’s a tug-of-war between ports and environmental protection.
According to arguments heard in a Supreme Court hearing held last week, it boils down to the meaning of the word “avoid”, and, it seems, whether there’s actually a conflict at all.
Back in 2010, after a controversial delay, the Conservation Minister Kate Wilkinson announced an updated coastal policy statement. It provided clearer guidance to councils about constraining development “to protect special areas of the coast”, while specifically mentioning ports and aquaculture.
(Wilkinson’s belated release followed public consultation led by a board of inquiry.)
Policy statements are national-level “instruments”, which influence council decisions.
If you can imagine Wellington’s bucket fountain, policy statements sit at the top, flowing through to regional policy statements, prepared by regional councils, and district and regional plans, before gushing through to resource consent decisions, floating at the bottom.
But what happens if the statement’s policies clash, seemingly irreconcilably?
One policy in the coastal policy statement (CPS) recognises the importance of the “efficient and safe operation” of ports. Several others, meanwhile – related to areas of natural character, outstanding landscapes, biodiversity, and nationally important surf breaks – emphasise protection.
The debate appeared to be put to bed in 2014 by a Supreme Court judgment known as the King Salmon case – named after the company wanting to establish and operate new salmon farms in the Marlborough Sounds.
The Supreme Court underscored the significance of language, finding that “avoiding” development, as mentioned in the CPS, means “not allowing”. Also, the higher the environmental value the more likely a development would be inappropriate.
There was no conflict, the court found. While the CPS said salmon farming should be provided for, it can’t be done everywhere – like when it causes adverse effects in outstanding areas.
The judgment said: “A danger of the ‘overall judgment’ approach is that decision-makers may conclude too readily that there is a conflict between particular polices and prefer one over another, rather than making a thoroughgoing attempt to find a way to reconcile them.”
(The minority decision, by Justice William Young, called it an “over-broad reach”, but the other judges suggested minor or transitory effects might be acceptable.)
Arguments in this latest Supreme Court case, heard last week, were couched as an existential threat.
Port Otago Ltd is appealing a Court of Appeal judgment which holds – much like in King Salmon – environmental policies in the CPS are bottom lines. That means activities with adverse effects on identified significant coastal areas are prohibited.
The company told the Otago Daily Times last month overly restrictive environmental constraints could have a significant effect on its operations.
Meanwhile, the Environmental Defence Society, the case’s first respondent, said in its March newsletter the appeal seeks “not to apply the King Salmon precedent to the current facts” but, rather, is an attempt to relitigate the case – which the society won in 2014 – “in its entirety”.
Last week’s hearing follows a cascade of court cases.
In 2018, the Environment Court recommended a specific ports policy be inserted into the CPS, allowing the company to operate in a way that potentially had adverse effects in areas where they should be avoided.
But that decision was overturned by the High Court and Court of Appeal, which found the “avoidance” policies in the CPS had primacy.
Awkwardly, the appeal originates from the regional policy statement (RPS) of the port’s owner, the Otago Regional Council.
Thou shalt not
Port Otago said Otago’s RPS – publicly notified in May 2015, and which is required to “give effect to” the coastal policy statement – didn’t properly provide for its operations, either now or in the future.
Further, the company said the application of King Salmon potentially threatened the future of ports at Dunedin and Port Chalmers.
At last week’s hearing, Port Otago’s lawyer Len Andersen QC said the Otago Harbour channel runs alongside areas of national significance, like the Aramoana salt marsh, and the surf break at Aramoana Spit.
A potential problem is needing to widen the shipping channel into the salt marsh to accommodate larger ships – “especially cruise ships”.
A situation specifically raised by Andersen was, pre-Covid, cruise ships having to navigate around the corner by the salt marsh so slowly they risked being caught by the wind.
That corner can’t be widened when existing policies are being applied as rules – as a veto, or absolute prohibition.
(The Supreme Court in King Salmon said particular policies “provide something in the nature of a bottom line”. In its Port Otago decision last July, the Court of Appeal said the effect of King Salmon was “quasi-rules” – though prohibited status was “not inevitable”, and port activities were not “presumptively inappropriate”.)
Andersen railed against this inevitability, this legal cul-de-sac.
“Treating this as an absolute bottom line, in my respectful submission, is not in accordance with the RMA itself.”
King Salmon’s proposal was for a new activity which clearly breached policies, he said – “there was no justification for it being where it was”.
Port Otago is an existing operation, with developments that might be essential to the port’s “safe and efficient operation”. “The port shouldn’t be precluded from raising that issue,” Andersen told the court.
(However, the Court of Appeal said the language in the CPS’s ports policy – “recognise” and “consider” – was not as “equally directive” as the environmental bottom lines.)
Andersen wondered about the effect of “maybe removing a bit” of the 75ha Aramoana salt marsh, or “some incursion” into it. A port is fundamentally important to a region, he said, and should be allowed to at least ask the question.
The Environment Court had gone too far in attempting to provide for necessary port work, by saying effects in outstanding areas could be “avoided, remedied or mitigated”, Andersen said. This wouldn’t “give effect to” the CPS.
But exceptions to the “avoid policies” might be needed, he argued, the minimum necessary in order to achieve the port’s safe and efficient operation.
New Zealand ports are dependent on overseas ships, and if they don’t meet their requirements – like accommodating bigger, longer ships – they’ll go elsewhere.
“From the port’s point of view, it is trying to be realistic about what it can expect by allowing it to operate safely and efficiently, but also recognising it operates in a sensitive environment,” Andersen said.
Marlborough District Council – which manages the region with the most extensive coastline, and is home to the country’s largest aquaculture industry – supported Port Otago. Its lawyer, John Maassen, said the battle was between the “absolutist approach” and the “constraining theory”.
Otago Regional Council lawyer Simon Anderson said the CPS’s “avoid policies” were quite narrow as they related only to matters of national significance.
“There actually needs to be an examination of the extent to which these values exist in that location ... and what effect there will actually be.”
That’s best done through a resource consent, Anderson said. It’s unlikely activities will be prohibited, he said, “except in cases where there’s sufficient information to know with certainty the activity will cause effects which can’t be avoided”.
‘Avoid means avoid’
The opening gambit at last week’s hearing by Douglas Allan, lawyer for Environmental Defence Society, was many outstanding or sensitive coastal areas had been lost or destroyed – a cumulative consequence of many small changes. That gradual degradation will continue if the ecological effects of developments are not addressed.
The words in the coastal policy statement are differentiated for a reason, Allan said. “Avoid” was deliberately used to provide environmental bottom lines.
Basically, if a development doesn’t generate an adverse effect it’s not against the policy, he said. But if an activity is going to have a significant effect in an area of outstanding value, “it’s unlikely you’re going to get a consent”.
Lawyer Martin Smith, for Forest & Bird, said the Conservation Minister might have specifically inserted mention of ports in the coastal policy statement, but she was alive to the fact that effects on protected values had to be avoided.
Exchanges with the Supreme Court Justices threw up some interesting scenarios.
What if the safe operation or future viability of ports – a backbone of the country’s economy and trade – required encroachment into sensitive areas?
The CPS’s ports policy recognises a sustainable national transport system “requires an efficient national network of safe ports”.
Smith said: “What’s protected is the network.”
So much for Port Chalmers, then, a judge floated, because there’s a port in Bluff? “You can’t just salami it, can you?”
Smith answered in a furniture analogy – if a table has six legs then it won’t fall over if only has four. He added the CPS was weighted in favour of the environment – that the emphasis on “avoid” was the tiebreaker.
Questioning of lawyers from the bench often focused on resolving an “irreconcilable conflict”.
At one point, one of the Supreme Court Justices floated an exemption being inserted into the regional policy statement for developments, with no reasonable alternative, encroaching on protected areas, as long as it was necessary to provide for the efficient and safe operation of the existing port.
Dredging up the past
Parties involved in another Supreme Court appeal, Royal Forest & Bird Protection Society v New Zealand Transport Agency, were allowed to make submissions in the Port Otago case because they involve similar issues.
The Supreme Court reserved its decision.
While much of the last week’s hearing honed in on the hypothetical, it’s worth highlighting the history of Otago Harbour, Ōtākou.
Ports were developed at Dunedin and Port Chalmers soon after European settlement, and dredging started in 1865.
The lower harbour channel, from the entrance to Port Chalmers, is 13.5m deep, making it one of the country’s two deepest container ports, the 2018 Environment Court decision said. The port company has plans to expand its capacity to accommodate larger container and cruise ships.
Outside the harbour’s main channels, water depths are relatively shallow – mostly less than two metres. At or below the high water mark there’s an abundance of floral and faunal diversity, including seagrass beds, the Aramoana salt marsh, rocky shores, and culturally important cockle beds.
The port’s financial benefits are counted in the millions of dollars, but existing adverse effects include air quality and noise, and the disposal of sediment from dredging. It’s a fine line, though – the nationally important surfbreak at Aramoana is maintained, in part, by sediment disposal.
In the legal world of conflict and compromise, there are real-world consequences, as the Supreme Court is very much aware.
