The extent to which the proposed end use of water (rather than just the effects on the environment of extracting the water) can be considered when granting consent has been a hotly contested issue in resource management law for some time.
Introduction
The Supreme Court recently released its decision in Cloud Ocean Water Limited v Aotearoa Water Action Incorporated [2023] NZSC 153 (Cloud Ocean Water) and the Court of Appeal has also considered the end use of water in Sustainable Otakiri Incorporated v Whakatāne District Council and Te Rūnanga O Ngāti Awa v Bay of Plenty Regional Council (Sustainable Otakiri). In this article, Resource Management and Environmental Partner, Joanna Beresford, explains what the two cases are about.
The Cloud Ocean Water case
Cloud Ocean Water addresses issues arising when a resource consent to take and use groundwater is transferred to a new owner who wishes to use the allocated water for a different purpose from the use permitted under that consent.
In this case the consent, was originally granted to “take and use” water for a wool scouring business but was renewed to allow a water bottling operation.
The Canterbury Regional Council granted new “use” consents for commercial water bottling relying on rule 5.6 of the Regional Plan, which treats as discretionary all activities not otherwise classified in the Plan.
The issue for the Supreme Court was whether the Regional Plan allowed the “take and use” consent in question to be decoupled and a new use-only consent granted independently this decoupling under rule 5.6, or whether a completely new take and use consent was required (as set out in rule 5.128).
If take and use elements could be decoupled under rule 5.6, water permit holders could “bank” the take components of their permits and repurpose (through a new consent application) the use component. This would enable applicants to avoid having to justify the volume of water to be deployed in the new use. If rule 5.128 apply, any new use for which a consent was required would also need a take component.
The Supreme Court unanimously dismissed the appeal. The RMA did not require take and use to be considered conjointly in all cases. Nor was take and use to be considered separately where the Plan does not so prescribe.
There was nothing in the Plan that suggested the drafters envisaged take and use consents would or should be divisible. While rule 5.6 filled a gap where the Plan did not classify an activity, rule 5.128 of the Plan did classify the use of water in relation to groundwater in a context where it required it to be considered as a component of an aggregated “take and use” activity.
Williams J wrote separately, concurring with the result but for the reason that the policies and objectives of the National Policy Statement on Freshwater Management and the Canterbury Regional Policy Statement would be undermined by decoupling “take” and “use” elements.
The Sustainable Otakiri case
Sustainable Otakiri relates to issues around the proposed expansion of a water bottling plant in the Bay of Plenty. It raises the relevance of the “end use” effects of an activity (in this case the relevance of the use of plastic bottles) when considering a resource consent under the RMA.
In 2016, Creswell NZ Ltd entered into an agreement to buy a water extraction/bottling business, Otakiri Springs Ltd, and the land where it was located. Creswell then sought various resource consents from the Regional and District Councils relating to water take and land use for the operation and expansion of the water bottling plant.
Environmental groups Sustainable Otakiri and Ngāti Awa appealed against the decisions. The Environment Court, followed by the High Court upheld the consents.
High Court held that the “end use” of plastic water bottles should not be taken into account; the activity was a discretionary “rural processing activity” rather than a non-complying “industrial activity”; and the proposed operation was the expansion of an existing activity rather than a new activity.
The High Court also rejected arguments that the resource consents would negatively affect te mauri o te wai and the ability of Ngāti Awa to exercise kaitiakitanga (collectively, the negative tikanga effects).
The Court of Appeal granted leave to appeal on all issues, apart from that relating to negative tikanga effects. The Court of Appeal dismissed the appeal, upholding the High Court’s decision, except for the ruling that the proposal was simply the expansion of an existing activity (although this did not affect the final outcome).
Sustainable Otakiri and Ngāti Awa applied for leave to appeal against the decision of the Court of Appeal to the Supreme Court. Ngāti Awa further applied for leave to appeal directly from the High Court decision on the negative tikanga effects.
At this point the position remains that “end use” of plastic water bottles should not be taken into account but the point will not be settled until the appeals are determined the Supreme Court. The cases were heard together by the Supreme Court in late November 2023, with a decision expected this year.
If you need advice on any of the issues raised in this article, please contact Joanna Beresford | Environmental Partner | 021 114 1277
Disclaimer. The information in this article is intended to provide a summary of the topic covered and is for general information only. It is provided without charge, is not comprehensive, and does not provide legal advice or other advice. Please seek independent advice before acting on any information in this article.