|
|
Home
| Databases
| WorldLII
| Search
| Feedback
High Court of New Zealand Decisions |
IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY
CIV-2009-485-379
UNDER Part I of the Judicature Amendment Act
1972
IN THE MATTER OF an application for review
BETWEEN SANFORD LIMITED
Applicant
AND THE CHIEF EXECUTIVE OF THE
MINISTRY OF FISHERIES
First Respondent
AND
EASTERN SEA FARMS LIMITED
Second Respondent
Hearing: 14-15 September 2009
Appearances: B Scott for the applicant
P McCarthy and G Gardner for the first respondent
F Cooke QC and
K M Barry-Piceno for the second respondent
Judgment: 12 October 2009
JUDGMENT OF CLIFFORD J
Introduction
[1] In these judicial review proceedings, the applicant, Sanford Limited
("Sanford") challenges decisions of the
first respondent, the Chief Executive of the
Ministry of Fisheries ("the Chief Executive") to issue marine farming and spat
catching
permits to the second respondent, Eastern Sea Farms Limited ("Eastern Sea
Farms").
SANFORD LIMITED V THE CHIEF EXECUTIVE OF THE
MINISTRY OF FISHERIES AND ANOR HC
WN CIV-2009-485-379 12 October 2009
Background
[2] Eastern Sea Farms wishes to establish
a very large mussel farm in the sea off
Opotiki on the East Coast of the North Island. Eastern Sea Farms first applied as
long ago
now as April 2001 for the necessary permits to do so. Eastern Sea Farms
required approval under both the Resource Management Act
1991 ("the RMA") and
the Fisheries Act 1983.
[3] Eastern Sea Farms' proposed mussel farm was some 4,750 hectares in area,
comprising an inshore (southern) block of 950 hectares (located approximately 6
kilometres from the coast) and an offshore (northern)
block of 3,800 hectares
(located approximately 8.5 kilometres from the coast). The farm was to be
developed in four stages,
with each stage of development being dependent on
satisfactory monitoring reports. The first stage was to comprise eight blocks of,
and
a maximum number of 256, longlines, the second 16 blocks and 672 longlines, the
third 912 longlines and the fourth 1,312 longlines.
It was intended that each stage
would commence three years after "completion" of the earlier stage (meaning at least
75% of the lines
in the earlier stage were in place). The longlines were to be spaced
50 metres apart and the blocks of longlines were to be separated
by 500 metre wide
navigation channels. All longlines were to be 200 metres in length. Twelve of the
longline blocks were to be within
the northern block and four within the southern
block.
[4] Under the RMA Eastern Sea Farms required a number of resource consents,
known as coastal permits (s 87), to build and occupy its proposed mussel farm.
Those permits comprised consents to:
a)
occupy land of the Crown in the coastal marine area (s 12(2)(a));
b) erect structures over the seabed (s 12(1)(a));
c) disturb the seabed (s 12(1)(b));
d) deposit material on the seabed (s 12(1)(c)); and
e)
discharge contaminants into the sea (s 15(1)(a)).
[5] Most of those coastal permits were able to be issued by the relevant
local
authority, the Bay of Plenty Regional Council ("the Regional Council"). However,
because of the size of the proposed farm,
the permit to occupy land in the coastal
marine area could only be issued by the Minister of Conservation on the basis of a
recommendation
of the Regional Council or, if that recommendation was appealed, a
report from the Environment Court (s 119 of the RMA).
[6]
Eastern Sea Farms also required, in terms of the Fisheries Act 1983, a marine
farming permit (s 67J) and a spat catching permit (s 67Q), both of which permits
were
to be issued by the Chief Executive. Sections 67J(1) and 67Q(1) of the
Fisheries Act 1983 respectively prohibit marine farming and
spat catching without
such permits. Marine farming (and spat catching) permits are required to specify the
area in which the permit
may be exercised and the fish, aquatic life, or seaweed that
may be farmed, and may be granted on conditions: s 67J(9) and (10) and
s 67Q(4) .
[7] Under the RMA, decisions on applications for coastal permits involved
consideration of a wide range of factors
in terms of the actual and potential effect on
the environment of allowing an activity. Under the Fisheries Act 1983, decisions on
marine farming permits and/or spat catching permits involved a much more focused
inquiry: the Chief Executive could not issue such
permits unless he or she was
"satisfied that the activities contemplated by the application would not have an
undue adverse effect
on fishing or the sustainability of any fisheries resource"
(ss 67J(8) and 67Q(4)).
[8] Before me the parties acknowledged that
the first element of that test, the
"undue adverse effect on fishing", concentrated on the effect of removing the area
covered by
a marine farm from being able to be used for fishing activities. The
fishing activities to be considered include commercial, recreational
and customary
fishing activities. In this case the issue is as regards the Chief Executive's decision
on the question of the effect
on commercial fishing activities. There is no challenge
to the Chief Executive's decision as regards recreational or customary fishing
activities. In fact, as the design of the marine farm provides for the mussel lines to
be anchored on the seabed so they are positioned
some metres underwater,
recreational and customary fishing activity will still be possible in the area of the
marine farm. The
same is not true for commercial activities, which will effectively
be precluded from the marine farm site and a certain distance
beyond its boundaries.
[9] The second element, the "undue adverse effect on ... the sustainability of any
fisheries resource",
was a broader question. As indicated, it assessed the impact of
the marine farm and, in particular, matters such as the "rubbish"
that the marine
farming activity would deposit on the seabed and the displacement of species which
the marine farm might cause, on
the sustainability of fisheries resources more
generally. Whilst it was accepted that adverse impacts on the sustainability of
fisheries
resources could, over time, also impact directly on fishing, nevertheless the
focus of the Ministry's inquiry as regards the first
limb of the test was principally on
the direct impact the establishment of the marine farm would have (in terms of the
reserving
of the area), here, on commercial fishing.
[10] Section 67J(4) and (5) of the Fisheries Act 1983 provided that an application
for a marine farming permit was to be accompanied by the application for the
corresponding coastal permits, or the permits themselves,
and that the marine
farming permit was not to be issued until the coastal permits had been granted.
Section 67Q(3) and (4) provided
similarly for spat catching permits. Marine farming
and spat catching permits could only be issued to persons who held coastal permits
for the areas applied for (ss 67J(2) and 67Q(2)).
[11] Accordingly, Eastern Sea Farms applied first under the RMA for the
necessary
coastal permits. It did so on 14 May 2001. Those applications were
considered by the Regional Council in a four day hearing from
25 to 28 February
2002. The Regional Council reserved its decision.
[12] Before the Regional Council released its decision, and
therefore before those
coastal permits had been granted or any recommendation made to the Minister, the
Resource Management (Aquaculture
Moratorium) Amendment Act 2002 came into
force on 25 March 2002. That Act imposed a moratorium (subsequently extended in
2004) on the processing or determination
by consenting authorities of applications
for coastal permits under the RMA. The moratorium was expressed to come into
effect (retrospectively)
on 28 November 2001. The moratorium did not, however,
prevent the further consideration, or grant, of an application (as relevant)
made
before 28 November 2001 which required notification and which had been notified.
[13] Eastern Sea Farms' applications did
require notification, and had in fact been
notified by the Regional Council prior to the effective date of the moratorium.
Therefore,
the Regional Council was able to complete its consideration of those
applications. It (or rather, Special Commissioners appointed
by the Regional
Council) did so. In May 2002 the Special Commissioners resolved to grant the
relevant coastal permits that fell within
the Regional Council's authority, and further
to recommend to the Minister of Conservation that coastal permits be granted to
Eastern
Sea Farms to give it the right to occupy the relevant coastal marine areas.
[14] A number of parties who had opposed the grant
of those coastal permits
appealed the Regional Council's decisions to the Environment Court. Sanford
appealed on 22 May
2002, on the ground, amongst others, that the Regional Council
had failed to have proper regard to the adverse effects the proposed
marine farm
would have on commercial fishing activities. Sanford noted that the question of the
extent to which fisheries issues
were relevant for the purposes of the RMA was, at
that time, subject to a reserved High Court decision.
[15] On 24 June 2002,
and no doubt on the basis of the Special Commissioners'
decision, Eastern Sea Farms applied to the Chief Executive for the necessary
marine
farming and spat catching permits.
[16] As noted by Sanford in its appeal to the Environment Court, at the time there
was considerable confusion and difficulty in dealing with marine farm applications
because of the overlapping jurisdictions under
the RMA and the Fisheries Act 1983.
When Eastern Sea Farms sought a priority fixture from the Environment Court for
the hearing of
Sanford's appeal in September 2002, Sanford referred to those issues
again, and noted that at that time the High Court had issued
a decision on those
issues, which decision was to be appealed. In declining Eastern Sea Farms'
application, the Environment
Court referred to that pending appeal.
[17] On 25 September 2003 the Court of Appeal released its decision, The Chief
Executive
v New Zealand Marine Farming Association Inc [2004] 1 NZLR 449.
That decision clarified the relationship between the RMA and the Fisheries Act
1983. Amongst other things, the Court of Appeal
held that coastal permits issued
under the RMA did not allow marine farm structures to be built until the Chief
Executive had also
issued a marine farming permit.
[18] By this time, a process of legislative reform was underway aimed at
clarifying the relationship
between the RMA and Fisheries Act 1983 processes for
the approval of marine farms.
[19] In August 2004 legislation ("the 2004
Reform Legislation") was introduced
into Parliament, and passed on 21 December 2004, to provide for a new aquaculture
regime to come
into force on 1 January 2005, on which date the moratorium would
expire.
[20] As of that date, the marine farming provisions
of the Fisheries Act 1983
would be repealed. The two principal components of the new regime would be (and
are now) set out in the
Resource Management Amendment Act (No. 2) 2004 and the
Fisheries Amendment Act (No. 3) 2004 ("the New Regime"). In essence, the New
Regime did away with the parallel RMA and Fisheries Act permitting processes, and
substituted a single planning process controlled
by the Regional Council but
constrained to zoned areas previously approved by the Chief Executive.
[21] The Aquaculture Reform
(Repeals and Transitional Provisions) Act 2004
("the Transitional Legislation"), which also came into force on 1 January 2005,
provided
a transitional regime. Section 50 of the Transitional Legislation provided
for those applications made before the commencement of,
and not subject to, the
moratorium (such as Eastern Sea Farms' applications) to continue to be considered
under the RMA and the Fisheries
Act 1983, notwithstanding the repeal of those
provisions, "as if the [2004 Reform Legislation] had not been passed". If granted by
the Chief Executive, s 20 and following of the Transitional Legislation applied the
New Regime to those marine farming and spat catching
permits.
[22] By August 2004, therefore, the Court of Appeal's decision in New Zealand
Marine Farming Association had clarified
the relationship between the RMA and the
Fisheries Act 1983. Furthermore, the 2004 Reform Legislation had been introduced,
clarifying
the way in which Eastern Sea Farms' application could be finally
determined.
[23] Against that background, in November 2004 the
Chief Executive, at Eastern
Sea Farms' request, began actively to consider the marine farming and spat catching
permit applications
Eastern Sea Farms had filed in 2002. He could not, of course,
issue those permits until the required coastal permits were issued
(ss 67J(5) and
67Q(4) Fisheries Act 1983).
[24] By June 2005 Eastern Sea Farms had settled most of the RMA appeals. The
appeals
by the commercial fishing parties, including Sanford, remained on hold. At
that time, the remaining parties to the appeals again
asked the Environment Court to
defer consideration. By then the parties were looking to the Chief Executive's
decisions to settle
the "fisheries" issues. The parties advised the Environment Court
that, once those matters had been determined, they could then determine
whether the
appeals would be withdrawn, settled by consent or if an Environment Court hearing
would be required.
[25] On 21 December
2006, the Chief Executive produced a decision declining
Eastern Sea Farms' application for its 4,750 hectare farm but approving,
in principle,
a marine farming permit and spat catching permit for the northern 3,800 hectare
block of that farm, subject to conditions
requiring the farm to be developed in stages
("the December 2006 Decision"). The permit conditions, to be imposed in reliance
on
s 67J(10) of the Fisheries Act 1983, would initially only allow the first stage of
development to occur, comprising 256 longlines.
At the same time the Chief
Executive noted that, as the resource consents were still under appeal at the
Environment Court,
any marine farming or spat catching permit could only be issued
after that appeal had been determined. The status of the December 2006 Decision
is
a matter at issue in these proceedings.
[26] At this point, the various parties re-engaged in the proceedings before the
Environment
Court. By 11 April 2008, the remaining parties to those appeals,
including Sanford, Eastern Sea Farms and the Regional Council, were
in a position
to file a memorandum seeking consent orders.
[27] In the memorandum filed in the Environment Court, the parties
noted:
Since the Appeals were filed the Applicant [Eastern Sea Farms] has obtained
a marine farming permit from the
Ministry of Fisheries which has reduced
the total farm size down to 3800ha and includes staging, with the first stage
not to exceed 950ha. As a result, development of the mussel farm in two
parts is no longer necessary ..."
[28] On that
basis, the parties to the Environment Court appeals provided revised
versions of the various consents for which they sought Environment
Court approval,
and of the terms of the consent to occupy. Key changes to the consents included a
requirement for a sanitary survey,
certain independent monitoring and an opportunity
to review conditions of consents affected by Treaty of Waitangi settlements. At
the
same time, Consent 61600, which is the consent to erect and maintain mussel farm
structures, included a revised "staging" condition.
This condition now read:
Development of the permit area shall be in five stages, up to the maximum
densities as set
out in the application, shown in BOPRC Plan numbers RC
61600/2, RC 61600/3, RC 61600/4, RC 61600/5, RC 61600/6 and
summarised below
Stage Number of blocks Maximum number of lines
1A 1
5
1 8 256
2 16 504
2 [sic]
16 704
4 16 984
Note: the number of blocks above includes
those to be used for spat catching
[29] I note that the reference to 16 blocks in stages 2 to 4 is recognised to be an
error,
the correct reference being to 12 blocks.
[30] It is this condition which would appear to most closely reflect the parties'
understanding
of the marine farming permit which, the parties advised the
Environment Court, Eastern Sea Farms had by then "obtained" from the
Chief
Executive.
[31] The consents provided for the erection of the marine farm structures in the
five stages (at [28] above),
with development of each successive stage (after stage 1)
being subject to monitoring and reporting requirements being met to the
satisfaction
of the Regional Council or delegate. The effect was to require at least three years'
monitoring and reports confirming
the lack of significant adverse effects on water
column characteristics, the benthic environment and marine mammals.
[32] On
15 September 2008 the Environment Court made the consent orders
sought. On 8 October the Minister of Conservation accepted the Environment
Court's recommendation, and issued a coastal permit to Eastern Sea Farms to occupy
the 3,800 hectares. As Sanford had consented to
those decisions, this proceeding
does not and cannot challenge them.
[33] On 15 October the Chief Executive issued Eastern Sea
Farms with marine
farming and spat catching permits in line with the December 2006 Decision.
[34] Eastern Sea Farms' applications
for its marine farming and spat catching
permits were, quite properly, dealt with by the Chief Executive under Part 4A of the
Fisheries
Act 1983. It is that legislation which is of principal relevance in these
proceedings. At the same time, as one aspect of Sanford's
challenge to the Chief
Executive's decision is that he unlawfully had regard to certain aspects of the New
Regime, it is necessary
to have an understanding of those provisions as well.
[35] Subpart 1 of Part 7A of the RMA provides for the establishment of
aquaculture management
areas ("AMAs") in which aquacultural activities may be
undertaken by regional councils including them in regional coastal plans
or
proposed regional coastal plans in accordance with s 165C. Once an AMA is
established, the regional council may by public notice
offer (usually by public
tender) "authorisations" for available space in the AMA for aquaculture activities for
which the area may
be occupied: s 165E of the RMA. Authorisations are granted
under s 165T.
[36] A person granted an authorisation does not require
a permit or other approval
from the Chief Executive to undertake the authorised aquaculture activities. Instead
the Chief Executive's
consent is obtained at an earlier stage, in relation to the
proposed AMA as a whole, rather than individual uses of the AMA. Section
64 of
the RMA requires that regional coastal plans are developed in the manner set out in
Schedule 1A of the RMA. Under clause 2(1)
of that Schedule, a regional council
must not notify a proposed regional coastal plan or a proposed change to a regional
coastal
plan until the Chief Executive has made an aquaculture decision under s
186E of the Fisheries Act 1996 in relation to any area described
in the plan as an
AMA.
[37] Under s 186E of the Fisheries Act 1996, the Chief Executive can make a
"determination" (a decision
that he or she is satisfied that the AMA "will not have an
undue adverse effect on fishing") or a "reservation" (a decision that
he or she is not
so satisfied) about the area, or different parts of the area, proposed to be an AMA.
[38] Any area in respect
of which a reservation is made on the basis of an undue
adverse effect on commercial fishing must be noted on the plan (clause 3,
Schedule
1A of the RMA), and no "authorisation" can be offered to any person to enable them
to use the AMA unless the person has
entered into an "aquaculture agreement" with
the commercial fishers affected (ss 186ZD to 186ZL Fisheries Act 1996).
Aquaculture
agreements are intended to provide for the consensual resolution of
attempts by marine farmers to establish farms in areas subject
to reservation.
[39] The Transitional Legislation provides a regime whereby marine farming and
spat catching permits, granted
by the Chief Executive under the old regime as it
survived the moratorium, are incorporated into the New Regime.
[40] Under
ss 20 and 50(6), a marine farming permit which has been granted
under s 67J is, from the date the application is granted, deemed
to be a coastal permit
granted under the RMA for the species (of fish, aquatic life, or seaweed) and area
referred to in the permit,
and on the same conditions.
[41] The Regional Council may, within 12 months of that date, commence a
review of the conditions
of a deemed coastal permit and, if it considers it necessary
to do so, vary, add, or delete conditions for the purpose of making
the conditions
consistent with the RMA (s 20(3)). The Regional Council must not, however,
amend the species or area covered by the
coastal permit (s 20(4)(b)). In exercising
these powers, the Regional Council is required, under s 30(2) of the RMA, to take
into
account the effect on fisheries resources, but not on fishing controlled by the
fisheries legislation.
[42] Sections 21 and 50(7)
of the Transitional Legislation provide similarly for
spat catching permits.
[43] Under s 45 of the Transitional Legislation,
the area to which a deemed
coastal permit applies is, with certain qualifications, deemed to be an AMA, and as
such is subject to
the provisions of the regional coastal plan or proposed regional
coastal plan that applies to the area.
[44] Deemed coastal permits,
being resource consents, are subject to review and
amendment as provided in the RMA.
[45] Section 127 of the RMA provides that
the holder of the deemed coastal
permit may apply to the Regional Council for a change or cancellation of a condition
of the permit (other than the duration of the permit). The procedures
for making a
resource consent application apply as if the application were an application for a
consent for a discretionary activity
(s 127(3); see ss 88 to 121). Where, however, the
variation would result in a fundamentally different activity or one having materially
different adverse effects, a new application may be required. In addition, under s
128 the Regional Council may serve notice on a
consent holder of its intention to
review the conditions of a resource consent at any time(s) specified for that purpose
in the consent.
Such a review may be held to deal with any adverse effect on the
environment which may arise from the exercise of the consent and
which it is
appropriate to deal with at a later stage, for any other purpose specified in the
consent, or where the information made
available at the time the permit was granted
contained inaccuracies which materially influenced the decision made and the effects
of the exercise of the consent are such that it is necessary to apply more appropriate
conditions. Reviews are to be conducted in
accordance with ss 129 to 133 (which
provide for notification, hearing and process requirements as well as mandatory
considerations).
Amongst other things, the reviewing authority must have regard to
any actual and potential effects on the environment of allowing
the activity (ss
131(1)(a) and 104(1)(a)). As above, the Regional Council may perform these
functions to avoid, remedy, or mitigate
the effects on fisheries resources (s 30(2)).
Overview of issues
[46] Sanford says that the Chief Executive, in issuing the
marine farming and spat
catching permits to Eastern Sea Farms, acted unreasonably and made errors of law in
deciding that a marine
farm of 3,800 hectares would not have an undue adverse
effect on fishing, and that a marine farm of 3,800 hectares developed to the
extent of
256 longlines would not have an undue adverse effect on the sustainability of any
fisheries resource. Sanford seeks orders
setting aside the Chief Executive's
decisions, and the permits issued. Alternatively, Sanford says the Court should find
that, if
valid, those permits allow a smaller marine farm than would now be possible.
[47] The Chief Executive and Eastern Sea Farms deny
Sanford's contentions.
[48] Eastern Sea Farms says further that even if the Chief Executive did err as
alleged by Sanford the
Court should, in its discretion, decline Sanford relief because
of the delays involved in it bringing these proceedings, and for
other reasons.
[49] Finally, Eastern Sea Farms says that if the Court upholds Sanford's claims,
and grants it relief, the decision
to grant marine farming and spat catching permits
should be remitted to the Chief Executive, with directions from the Court requiring
the reconsideration of those decisions on a revised basis.
Discussion
Unlawful decision: no undue adverse effect on fishing
[50] Sanford argues that the Chief Executive's decision that the issue of
challenged permits for a 3,800 hectare marine farm
would not have an undue adverse
effect on fishing was unreasonable. It was made without sufficient evidence, or a
rational basis,
and not in reliance on the best available information as required under
s 10 of the Fisheries Act 1996. It was therefore unlawful.
[51] The factual context for this argument essentially comprises the record of the
Chief Executive's decision-making. Those matters
were largely traversed in an
affidavit provided by Mr Daniel Lees of the Ministry of Fisheries. Mr Lees was, at
the time, the Aquaculture
Manager with the Ministry of Fisheries and held delegated
authority to make decisions on behalf of the Chief Executive regarding
marine
farming permits and spat catching permits. There was no challenge to that
delegation.
[52] Mr Lees explained that
the Ministry ran a two-stage decision-making process
for marine farming and spat catching decisions. On receipt of an application the
Ministry would consult
and then the Chief Executive's delegate would make a
preliminary decision based on the available information. That preliminary decision
would be communicated to affected parties, with an opportunity for them to
comment and provide additional information. The delegate
would then make a final
decision whether or not to issue a permit. That final decision would normally be
made after the consenting
authority had issued the relevant resource consents.
[53] In the case of Eastern Sea Farms' applications, Mr Lees proceeded to
make a
final decision, which he referred to as a "decision in principle", before the relevant
resource consents had been issued.
He did so, he deposed, in order to facilitate the
parties' appeal to the Environment Court on the resource consent applications.
Given the way in which the parties had themselves updated the Environment Court
from time to time, and had explained why Environment
Court consideration of the
appeal should be deferred pending the Chief Executive's consideration of Eastern
Sea Farms' applications
under the Fisheries Act 1983, that would indeed appear to
have been the case.
[54] At the same time I accept that Mr Lees was
clear that no marine farming or
spat catching permits could be issued until the relevant resource consents were
issued. I do not
think, therefore, that there was anything improper or incorrect as
Sanford suggested at various points in the way the Ministry
considered Eastern
Sea Farms' application notwithstanding the fact that the Environment Court appeal
had not been determined nor
coastal permits issued.
[55] On 9 March 2006 a Ms Jansen of the Ministry produced a preliminary
evaluation report on Eastern
Sea Farms' applications. That March 2006 preliminary
report recommended to Mr Lees that, as the Chief Executive's delegate, he approve
Eastern Sea Farms' applications for the northern 3,800 hectare block and 984
longlines. The essential reasoning of the March 2006
preliminary report was that, in
terms of Eastern Sea Farms' application, the Ministry could not be satisfied that the
originally
proposed 1,312 longlines over 4,750 hectares would not have undue
adverse effects on fishing or the sustainability of fisheries resources.
However, it
was so satisfied as regards 3,800 hectares of the farm and 948 longlines. As regards
commercial fishing, whilst there
would be some adverse effects, the Ministry did not
consider they would be undue. In particular:
a) approval of the
northern site only would restrict the loss of fishable
area for commercial fishers by compacting the marine farm
structures
instead of spreading them over two areas;
b) the farm would equate to only a small proportion
of the total relevant
fishing area;
c) changes in fishers' behaviours would not put undue pressure
on the
sustainability of fish stocks being harvested; and
d) whilst fishers would face additional
costs, the Ministry did not
consider those costs to be prohibitive and much of the Eastern Bay of
Plenty trawl grounds would still be accessible, even if less efficiently
used.
[56] Mr Lees accepted the Ministry's
recommendation, and made his preliminary
decision accordingly. In describing in his affidavit the key elements of that decision,
as regards adverse effects on fishing, Mr Lees referred in particular to impacts on
fish catches:
[I a]greed with the report
that I could be satisfied that development of the northern
3800 ha block only would not have an undue adverse effect on fishing.
I was
satisfied that the potential average annual catch losses due to the 3,800 ha northern
block alone would be less
than 5% for the fisheries affected. Although my
assessment whether a proposed marine farm would have undue adverse effects
depended on the circumstances of each case,
an average annual catch loss of about
5% is the point at about which I would consider adverse effects on commercial
fishing might become undue ...
[57] Following consultation and comment, on 15 December 2006 Ms Jansen
forwarded a final evaluation
report and recommendation to Mr Lees. That report
recommended Mr Lees make a decision in principle to decline Eastern Sea Farms'
application in its entirety. Ms Jansen explained the changed recommendation by
reference to additional information that the Ministry
had received. As regards the
impact on fishing activities, and particularly those of commercial fishers, the report
noted that new
information relating to commercial fishing activity in the area of the
application site "suggests adverse effects on fishing may
be more significant than
originally anticipated in the preliminary decision". Commercial fishers had provided
more detailed information,
the Ministry itself had updated catch effort information,
and new computer software had allowed a more thorough and detailed analysis
of
that catch effort information.
[58] In light of that new information, the December 2006 final report now
concluded that:
Consequently, due to the large amount of uncertainty regarding effects of the
application site on commercial fishstocks,
and the level of commercial
fishing taking place in the area of the application site, this report
recommends you cannot
be satisfied the activities contemplated by the
application site, in its entirety, would not have an undue adverse effect
on
commercial fishing.
[59] In other words, as regards the site in its entirety, the Ministry reached the
same conclusion
as it had in the preliminary reports. When it came to consider the
possibility of options to avoid remedy or mitigate adverse effects,
the Ministry
concluded as follows:
[The Ministry] acknowledges adverse effects on both commercial fishing
and the
sustainability of fisheries resources would be reduced by reduction
of the size of the application site. However, new information
received since
the preliminary design suggests adverse effects on fisheries resources may
be more significant and of
higher consequence than originally anticipated in
the preliminary decision. Similarly, adverse effects on fishing may be more
significant as well. Considering the increased uncertainty in the information
and stronger evidence of severe adverse
effects, this report recommends that
without conclusive information to precisely determine what levels of
mitigation
would be appropriate or required for the application site, you take
considerable caution in considering operations to avoid,
mitigate or remedy
adverse effects on fishing and the sustainability of any fisheries resource.
[60] On that basis Ms Jansen
communicated the recommendation to Mr Lees that
he decline Eastern Sea Farms' applications. As is clear, Mr Lees did not accept that
recommendation. Rather, he reached a preliminary decision to issue the permits.
[61] Mr Lees, in explaining his decision as regards
adverse effects on commercial
fishing in his affidavit provided to this Court, said he had:
33.2 Agreed with the final
recommendation that I could not be satisfied the
activities contemplated by the whole 4,750 ha site would not have
an undue
adverse effect on fishing. But, contrary to the recommendation, I was
satisfied that approval
of the northern 3,800 ha block alone would not have
an undue adverse effect on fishing.
33.3 Considered
that, although approval of the northern block alone would result
in some catch losses for commercial fishers, those
catch losses would be
less than 5% of the average total annual finfish catch in FMA 1 and less
than 5% of the average total annual
catch of the individual fisheries affected
in FMA1, including John Dory, Gurnard, Snapper, Tarakihi and Trevally.
In making my decision I took into account:
33.3.1 The estimated catch losses of John Dory, Gurnard,
Snapper,
Tarakihi and Trevally contained in Tables 7, 8 and 9 of the final
evaluation
report and the discussion of estimated catch losses
contained in para... 222 to 294...;
The availability of alternative fishing sites and economic costs to
33.3.2
fishers of
using those alternative sites;
The potential spatial changes to commercial fishing pressure;
33.3.3
The cumulative effects of previous farm approvals in FMA1;
33.3.4
The biology and mobility of the finfish pelagic species caught at the
33.3.5
site.
[62] Mr Lees explained that the information available to him did not, in effect,
allow him to separately identify the
extent of the adverse effects for each of the two
blocks. He then went on to comment:
37. When making my final decision
on what area of the application I was satisfied
to approve, I was very conscious of deficiencies in the catch effort
data and
exercised appropriate caution. I recognised that I had to be satisfied given the
uncertainty in
the available information that the area approved, being the
3,800 ha northern block, would not have an undue adverse
effect on fishing.
38. I note that fishing interests, including Sanford, had provided little information
to
help me differentiate between the adverse effects of the two blocks (or
areas within the two blocks) on commercial fishing.
I therefore had to use the
information available and exercise my judgement.
[63] On that basis he concluded:
...Consequently after considering the available information, I decided that
39.
approval of the northern
3,800 ha block would result in the best overall
outcome (in respect to fishing, and aquaculture) while ensuring that
I could be
satisfied that the activities contemplated would not be undue on fishing.
[64] Sanford pointed, in particular,
to the fact that the final evaluation report in its
assessment of effects referred generally to "the application site". It made no
separate
analysis of the northern block and the southern block in terms of undue adverse
effects on fishing. Mr Lees, therefore,
had no rational basis to conclude, on the one
hand, that an undue adverse effect would be caused by approving the 4,750 hectare
area
but that, on the other hand, no such undue adverse effect would be caused by
approving the 3,800 hectare area.
[65] A decision
will be unlawful due to an absence of rationality or
unreasonableness where, as articulated in Associated Provincial Picture Houses
Ltd
v Wednesbury [1947] EWCA Civ 1; [1948] 1 KB 223; [1947] 2 All ER 680, the decision reached is
effectively one which no reasonable decision-maker could, on the information
available to them, have reached.
[66] Here, and as emphasised by Mr McCarthy for the Chief Executive, Mr Lees
made a decision based on the extensive information
provided to him and the
Ministry throughout the consultation period and as set out in the two evaluation
reports. In making his decision,
he relied on his own individual expertise and
experience. In his affidavit, Mr Lees noted that, in terms of the information
available
to the Ministry, his decision effectively reflected his expert assessment of
the scale of the effects of the original 4,750 hectare
two block farm applied for, and
the scale of the effects of the smaller 3,800 hectare block. In particular, and as
regards the effects
on fishing, Mr McCarthy emphasised Mr Lees' assessment that
catch losses as a result of the approval of the northern 3,800 hectare
block would be
less than 5% of the average total fish catches in the larger fish management area. As
he had noted when explaining
his preliminary decision ([56] above) it was Mr Lees'
view that an average annual catch loss of about 5% was the point at which he
would
consider adverse effects on commercial fishing might become undue. Given that it
was not possible to distinguish in any meaningful
way between the impact on fishing
as between the two blocks, Mr Lees' decision was essentially one based on scale,
and his assessment
on the information available to him of the scale of the adverse
effect caused by the northern block alone, as opposed to that
which could be caused
by approval of both blocks.
[67] Essentially, therefore, having concluded that the catch losses would be
less
than 5% of the average total annual finfish catch in FMA1, and less than 5% of the
average total annual catch of the individual
fisheries affected, Mr Lees was able to
conclude that approval of the northern block would not have an undue adverse effect
on fishing.
In my view, that was the key judgment Mr Lees made.
[68] There was some attention paid by Mr McCarthy and Mr Scott to the relevant
part of Mr Lees' affidavit. Mr Scott criticised the affidavit as not disclosing, as I
understood him, how that conclusion had been
reached. Mr McCarthy endeavoured
to explain how it had been reached by pointing to a separate assessment in the final
report that
the Ministry could "estimate about 6.5% of the bottom trawl catch in
FMA1 would be excluded by development of the application site".
He said that, by
reference to the proportion of the total application area comprised by each of the
northern and southern blocks,
it was clear that less than 5% of the bottom trawl catch
would be affected once the southern block was excluded. Mr Scott's reply
was that
was supposition on Mr McCarthy's part, as Mr Lees had not so explained his
conclusion.
[69] I do not think Mr McCarthy's
submission took the matter very far. A pro-
rata division, on the basis of area, of the bottom trawl catch loss between the
northern
and the southern blocks does result in the conclusion that the exclusion of
commercial fishing from the northern block alone would
cause a loss of less than 5%
of the bottom trawl catch. At the same time, however, it is clear that Mr Lees was
assessing more than
bottom trawl catch effects. It is his general conclusion that has
been challenged. In this context, it is of some significance that
Mr Wilkinson, who
provided affidavit evidence on behalf of Sanford, did not in his reply affidavit in any
way challenge Mr Lees'
factual conclusions. Therefore, while Mr Lees may not
have explained the calculation process he went through, he has clearly stated
both
the basis of his decision and the conclusions he reached, based on the evidence
before him. The factual validity of that conclusion
has not, as a matter of evidence,
been challenged before me so as to support a claim of irrationality..
[70] As to the overall
significance of that less than 5% total annual finfish catch
loss, there was no evidence that commercial fishers would not be able to catch that
5% elsewhere, although there was evidence that replacing the farmed area with other
areas could involve increased costs.
[71]
By reference to Mr Lee's central conclusion, I am satisfied therefore that, in
the Wednesbury sense, the Chief Executive's decision
that approval of the 3,800
hectare area marine farm would not have an undue adverse effect on fishing is a
decision that was open
to him. The Chief Executive, through Mr Lees, was in
possession of extensive information. A preliminary report had reached
that
conclusion. A second report, prepared by Ms Jansen, reached an alternative view but
in doing so noted that it was a "finely
balanced decision" and that Mr Lees could
arrive at a different decision than she had reached. At the end of the day, Mr Lees
applied
his judgment to the information before him and, on the basis he explained in
his affidavit, reached the view that he did. Whilst
I acknowledge that the final
evaluation report did not separately identify fisheries adverse effect considerations
for the northern
and southern blocks, I do not think that precluded Mr Lees reaching,
in a rational and reasoned way, the decision that he did.
[72] Lastly under this head, s 10 of the Fisheries Act 1996 provides that all
persons exercising or performing functions, duties,
or powers under that Act, in
relation to the utilisation of fisheries resources or ensuring sustainability, shall take
into account
information principles including that decisions should be based on the
best available information. In my view, and notwithstanding
that s 10 does not apply
as the decision here was not made under the 1996 Act, the Minister did in fact act on
the best information
available to him.
Decision: no undue adverse effect on the sustainability of any fisheries resources
[73] The Chief Executive's
decision that the issue of the challenged permits would
not have an undue adverse effect on the sustainability of any fisheries resource
was
challenged by Sanford as being unlawful for a variety of reasons. The Chief
Executive had made that decision by reference
to the adverse effects of the first stage
of Eastern Sea Farms' proposed development, namely the establishment of a marine
farm comprising
256 longlines. In Sanford's submission, that was an unlawful
approach to adopt because, in doing so, the Chief Executive:
a) failed to undertake the assessment required under s 67J(8) of the
Fisheries Act 1983 in respect of sustainability
issues as regards the
activities contemplated by the permit application in the 3,800 hectare
area;
b) effectively, through the imposition of conditions which were
unlawful, sub-delegated to the Regional
Council future decision-
making on the question as to whether the later stages of Eastern Sea
Farms'
proposed marine farm development would comply with
s 67J(8) as regards sustainability of fisheries resources issues;
and
c) took into account an irrelevant and impermissible consideration,
namely the effect of ss 20 and
21 of the Transitional Legislation.
[74] Sanford's challenge here had a central theme. Within the fishing industry,
the New Regime,
and the Transitional Legislation, reflected the outcome of a closely
fought battle. Under the old regime, fishers enjoyed the benefit
of the undue adverse
effect test that the Chief Executive was required to perform both as regards the effect
of a marine farming
proposal on fishing, and the effect of such a proposal on the
sustainability of fisheries resources. Under the New Regime, while
the Chief
Executive was required to perform that test as regards an AMA area and its effects
on fishing, the question of the sustainability
of fisheries resources as impacted by
aquaculture proposals would be assessed under the RMA by regional councils.
[75] Importantly, however, under
the Transitional Legislation the Chief Executive
was still required to make both of those assessments as regards areas in respect
of
which marine farming permits might be issued, and which would become AMAs.
Sanford submits that the effect of Mr Lees' decision
was that the Chief Executive
had limited his assessment of the undue adverse effects of marine farming on the
sustainability of any
fisheries resource within (what would become) the relevant
AMA (the 3,800 hectare area) to the effects of the initially approved
256 longlines.
[76] Given the nature of Eastern Sea Farms' applications under the RMA, Sanford
submits that the Chief Executive
should have made his decision with reference to the
possible adverse effects of the completed four-stage proposal. Otherwise, those
effects would, except for stage 1, now only be assessed under the RMA. Sanford
had, in effect, lost the benefit of the protections
which the Transitional Legislation
had been intended to give it.
[77] When he issued his decision, the Chief Executive did
so in the following
terms:
Eastern Sea Farms Limited
(hereinafter called "the permit holder/s") is/are hereby permitted to
undertake
the activity of marine farming (as defined under the Fisheries Act
1983) of the species listed in the attached Schedule A (referred
to in this
permit as "stock").
The marine farming is only to take place within the area described in the
attached Schedule B (the
permitted area) and located as shown on the site
map annexed to Schedule B, subject to the following conditions:
Duration of Permit
1 This permit commences on the date of signature and expires on 17
October 2028, being the expiry date of resource consent
BOPRC 61600.
Staged development
2 Development of the area defined in Schedule B shall occur in stages.
3 This permit authorises
development of the defined area to stage one
only (maximum of 256 lines) of the five stages summarised below, and
as shown
in Schedule C:
Stage Number of blocks Maximum number of lines
1A
1 5
1 8 256
2
16 504
3 16 704
4
16 984
(As noted above, the references to 16 blocks should be to 12 blocks)
[78] In the reasons for his decision (as articulated on 21 December 2006), Mr
Lees, on behalf of the Chief Executive, had expressed
himself thus:
Taking into account the available information I agree with the
recommendation in the final evaluation
report. I find that I cannot be
satisfied that the activities contemplated by the 4,750 ha farm would not
have an undue
adverse effect on fishing or the sustainability of any fisheries
resource.
However, I am satisfied that approval of
the Northern block (3800 ha) alone
would not have an undue adverse effect on fishing. I am also satisfied that
approval
of the northern block alone would not have an undue adverse effect
on the sustainability of any fisheries resource providing
appropriate staged
development of the site occurs.
My decision is, therefore, to approve a marine farming permit and
spat
catching permit for the northern 3,800 ha block, but to condition the permit
under section 67J(10c) of the Fisheries
Act 1983 to require the farm be
developed in stages.
The permit conditions will initially only allow the first stage
of development
to occur, being 8 blocks and 256 longlines. These conditions, however, can
be reviewed and further development
of the site can occur providing the
applicant can satisfy the administering authority at that time that the next
stage of development (both for spat
catching and marine farming) would not
result in undue adverse effect on the sustainability of any fisheries resource.
This decision to allow further development of the site will depend on the
level of adverse effects the first stage of
development has on the
sustainability of any fisheries resource and whether additional adverse
effects would be undue.
[79] Therefore, central to Sanford's challenge to the Chief Executive's decision on
the issue of adverse effects on the sustainability
of any fisheries resource, were the
limitation of that decision to, in effect, an assessment of the effect of 256 longlines,
and
the acknowledgement that subsequent stages would be assessed by the Regional
Council in accordance with the New Regime. Furthermore,
the Chief Executive had
erred in recording an understanding that further stages of development would only
occur if the administering
authority was satisfied that they would not "result in
undue adverse effect on the sustainability of any fisheries resource". Whilst
that was
the test to be applied by the Chief Executive himself under the old regime and the
Transitional Legislation, that was not
the test that the Regional Council would apply
in the future.
[80] Sanford also submits that it was not correct to argue, as
the Chief Executive
did, that the decision to approve the marine farming permit in "stages" could have
been made under the Fisheries
Act 1983, without the assistance or benefit of the
Transitional Legislation. The Chief Executive had never approved permits in that
way in the past. Moreover, both the March 2006 preliminary report and the
December 2006 final report so advised Mr Lees. In
those reports Ms Jansen for the
Ministry noted that, under s 57J of the Fisheries Act 1983, the Chief Executive had
to be satisfied
that the activities contemplated by the application would not have an
undue adverse effect on fishing or fisheries resources "at
any time". She therefore
expressed the view that the Chief Executive could not re-evaluate the application for
each stage of the
development. As such, her report assessed the potential impacts of
a full development of the farm. It was an important part of Sanford's
challenge that
Mr Lees did not adopt that approach.
[81] Sanford was not saying that the Chief Executive could only adopt an
"all or
nothing" approach to a marine farming application (as the Chief Executive
characterised Sanford's submission). Rather, the
Transitional Legislation required
the Chief Executive to make the undue adverse effects determination by reference to
the whole of
the area that would become an AMA. Here he had not done so. He
could, on Sanford's submission, have approved the application by:
a) Either confining the area approved to that occupied by the eight blocks
in which the 256 longlines
of the first stage would be placed; or
b) By imposing a condition that required the s 67J undue adverse effect
test to be applied to any expansion of the approved activity.
He had, however, done neither.
[82] In my judgment,
the essential question here is whether the Transitional
Legislation allowed the Chief Executive to approve, as I think in effect
he did, the
"first stage" of the application for which consent was being sought under the
Fisheries Act 1983 and the RMA, and in
doing so acknowledge that the further
stages for which conditional approval under the RMA had been given, would in
terms of the
assessment of their adverse effect on the sustainability of any fisheries
resource fall to be approved by the Regional Council.
Very particularly, Sanford
argued that in taking that approach the Chief Executive had not observed the
requirement in s 50(5) that
decisions under the Transitional Legislation by the Chief
Executive had to be determined under the Fisheries Act 1983 "as if this Act had not
been passed".
[83] The starting point
is therefore whether, separate from the Transitional
Legislation, the Fisheries Act 1983 provided for staged approvals.
[84]
Section 67J(10)(c) of the Fisheries Act 1983 allowed the Chief Executive to
issue marine farming permits on conditions that he or
she "considered necessary or
desirable to avoid, remedy or mitigate adverse effects on fishing or the sustainability
of any fisheries
resource" (and s 67Q(4) provides similarly for spat catching
permits). Section 67J(8) required the Chief Executive not to issue a
marine farming
permit unless he or she was satisfied that the activities contemplated by the
application would not have an undue
adverse effect on fishing or the sustainability of
any fisheries resource. In referring to the "activities contemplated by the
application", and given the very simple form of marine farming permits (which are
required to specify only the area in which the
permit may be exercised and the fish,
aquatic life or seaweed that may be farmed (s 67J(9)), it is my view that the Chief
Executive
inevitably had to, and did, have regard to the extent of the activities
contemplated by the parallel applications for coastal permits
under the RMA.
[85] I accept, further, as Sanford indeed acknowledged (above [81]), that the
Chief Executive was not required
to take an "all or nothing" approach to such an
application. Approval could be given for any part of the "activities contemplated"
for which the s 67J(8) test was satisfied. Therefore it is my conclusion that, where
an application sought approval for the whole
of a marine farm to be developed in
stages in accordance with accompanying RMA applications, the Chief Executive
could, under s
67J(10)(c), impose a condition which, in effect, limited the marine
fishing permit granted to part only of such an application.
[86] I reach that conclusion on the basis that any subsequent expansion of the
extent of the marine farm (allowing further development
in compliance with the
RMA conditions) would require that condition to be changed or otherwise reviewed
under s 67K of the Fisheries
Act 1983. Section 67K entitles the holder of a marine
farming permit to apply to the Chief Executive to change or cancel any of the
conditions of the permit. Section 67K(4) requires the Chief Executive to apply again
the undue adverse effects test if such an application
would change the species of fish,
aquatic life or seaweed or area to be farmed under the marine farming permit.
[87] Here the
condition was to limit the marine farming permit to the 256
longlines in the eight blocks of the first stage of the proposed farm.
On its face,
therefore, s 67K(4) would not require the Chief Executive to reconsider the
sustainability of the fisheries resources
question where the amendment relates to a
condition specifying the number of longlines (as opposed to the area or species to be
farmed).
I do not think, however, that the scheme of the Fisheries Act 1983 would
allow the Chief Executive, having imposed a condition that
reflected a sustainability
assessment based on a maximum number of longlines, not in fact to reconsider that
assessment if that number
of longlines was to be increased. That, I accept, would
run counter to the scheme of that legislation. Furthermore, I do not think
it would be
necessary to add an express condition to that effect to require the Chief Executive to
apply that test.
[88] I therefore
conclude that under the Fisheries Act 1983, unamended by the
Transitional Legislation, the Chief Executive could issue a marine farming
permit in
similar terms to similar effect as that which he issued to Eastern Sea Farms as
regards the "staging" conditions. This
is notwithstanding the views expressed by Ms
Jansen in her preliminary and final reports, and also if this is the case the practice
of the Chief Executive previously. Substantively, the Chief Executive's decision
was to grant Eastern Sea Farms a marine farming permit for part only of the
activities it had originally applied for. If Eastern Sea Farms wished to extend the
farm's activity beyond the 256 longlines, they
would in effect have to apply to vary
that condition and the Chief Executive would be required to consider that application
on its
terms. In doing so, he would have to assess the sustainability effects of the
proposed extension.
[89] Therefore, the Chief Executive
issuing Eastern Sea Farms' permits on the
condition that only the first stage and 256 longlines could proceed did not breach the
requirement in s 50(5) that decisions under the Transitional Legislation had to be
determined under the Fisheries Act 1983 "as if
this Act had not been passed".
[90] However, in issuing Eastern Sea Farms its permit, I think it is also fair to say
that the
Chief Executive, through Mr Lees, did have regard to the fact that, in the
future and when the underlying conditions of the RMA permits
allowed (above
[31]), Eastern Sea Farms' application to vary the marine farming permit condition as
to the number of longlines would
fall to be decided by the Regional Council.
Moreover, Mr Lees would appear to have had it mind that the Regional Council
would do
so by reference to the old s 67J(8) test, and not the provisions of the RMA
as would apply at the relevant time.
[91] I do not
consider that, however, to be an error that renders the Chief
Executive's decision unlawful. I think it would have been unrealistic
for Mr Lees
not to have been aware that, although approved under the Transitional Legislation,
Eastern Sea Farms' permits would be
managed on an ongoing basis under the New
Regime.
[92] The requirement under s 50(5) to determine the application as if the
Transitional
Legislation had not been passed in my view required Mr Lees to
consider that application in terms of s 67J, and in particular s 67J(8),
as if the
Transitional Legislation had not been passed. To the extent that he approved the
application, that is what Mr Lees did.
Beyond that Mr Lees was simply, in his own
mind, acknowledging the procedure whereby under the RMA Eastern Sea Farms,
both in terms
of its original resource consents and in terms of the deemed coastal
permit (and therefore resource consent) that the marine farming
permit would
become, would have to satisfy the Regional Council on sustainability issues as
regards any future expansion of its marine
farming activities.
[93] I also accept that he would appear to have had the wrong legal test in mind.
Perhaps, given the complexities
of the various pieces of legislation, as acknowledged
by all the parties to these proceedings, it is little surprise that he did.
However, I do
not think that affects the lawfulness of his central decision which, as I have said, I
consider to be that of granting
a marine farming permit for a 3,800 hectare area
limited to 256 longlines.
[94] I therefore find that the Chief Executive's decision
that the permits, as issued,
would not have an undue adverse effect on the sustainability of any fisheries
resource was not unlawful.
It was open for the Chief Executive, applying the
Fisheries Act 1983 as if the Transitional Legislation had not been passed, to approve
only the first stage of the development (i.e. 256 longlines within the 3,800 hectares).
The Chief Executive (through Mr Lees) was
satisfied on the s 67J(8) test as regards
the activities contemplated by that part of the application. Beyond that, and as a
consequence
of the Transitional Legislation, any subsequent variation of the
conditions on which the permits were granted was to be determined
by the Regional
Council. Recognising that reality was neither an unlawful sub-delegation nor the
Chief Executive taking into account
an irrelevant or impermissible consideration.
[95] In my judgment, taking this approach to the interpretation of the Fisheries
Act 1983 and the requirements of the Transitional Legislation, is to adopt a similar
approach to fisheries legislation as taken by the
Court of Appeal in New Zealand
Marine Farming Association (above), and endorsed by the Privy Council on appeal
in Marlborough Aquaculture
Ltd v Chief Executive Ministry of Fisheries (2005) 12
ELRNZ 1; [2005] UKPC 29. That is, to consider the legislative context in its
entirety both RMA and fisheries legislation and to interpret the provisions
of
those Acts in a workable manner and in a way which achieves Parliament's overall
purpose.
[96] I therefore conclude that the
Chief Executive's decision that the issue of the
challenged permits would not have an undue adverse effect on the sustainability
of
any fisheries resources was a lawful one.
Decision: conditions imposed
[97] Here Sanford submits that, if the Chief Executive
was entitled to impose
conditions for staged development (and did not need to determine whether the fully
developed marine farm would
have an undue adverse effect), the permits should
have been subject to the conditions which Sanford says were indicated in the
December
2006 Decision. That is, the Chief Executive should have imposed a legal
requirement that any further staged development could only
occur if the s 67J(8)
criteria continued to be met as regards sustainability issues. There were two reasons
for that proposition:
a) That was the only way that the Chief Executive could ensure that
those criteria would be applied
to the whole development in that, on
subsequently reviewing the conditions (under ss 20 and 21, or later
under ss 127 and 128) the Regional Council does not apply the
s 67J(8) test; and
b) The only proper
conclusion to draw from the words used in that
(December 2006) decision was that such a condition would be
imposed.
[98] Although outlined as a separate ground of challenge, in many ways this
aspect of Sanford's case can be
seen as a refinement of its central challenge to the
issue of the permits. It is my view that, given the conditions on which the
permits
were in fact issued, the Chief Executive was not required to impose the condition
Sanford puts forward. In fact, and as Eastern
Sea Farms submitted, such a condition
would appear to be at odds with the legislative scheme going forwards. In particular,
ss 20(3)
and 21(3) of the Transitional Legislation give a consent authority the ability
to review the conditions of deemed coastal permits
within 12 months of the
commencement of the Act (or in Eastern Sea Farms' case, from the issuing of the
permits). On such a review
the consent authority may, "if it considers it necessary to
do so, vary, add, or delete conditions for the purpose of making the
conditions
consistent with" the RMA. If, therefore, the Chief Executive had imposed a
condition which required the Regional
Council to apply the Fisheries Act 1983 test,
then the Regional Council would on the face of things have been entitled to vary or
delete that condition to the extent that it imposed a different review standard as
regards sustainability issues than would have
been required under the RMA.
[99] More fundamentally, and as already indicated, I think the outcome of the
Chief Executive's
decision (absent the condition advanced by Sanford) is consistent
with the Transitional Legislation. Here, an AMA of 3,800 hectares
had been
approved, albeit one which gave Eastern Sea Farms exclusivity as regards the whole
area. Eastern Sea Farms' rights, however,
as regards the impact that farming
operations may have on sustainability of fisheries resources, were limited to 256
longlines. It
was by reference to that amount of activity that the Chief Executive had
concluded he was satisfied that approval of a marine farm
would not have an undue
adverse effect on the sustainability of any fisheries resource. As so approved,
therefore, existing fishers
had received the benefit of the Chief Executive's
consideration of both tests. In the future, the expansion of those activities would
depend on the Regional Council granting a variation to Eastern Sea Farms' deemed
coastal permit under the RMA. In determining that
issue the Regional Council
would be guided by the general purpose of the RMA of promoting sustainable
management (s 5) as well as the provisions of s 30(2), which provides
that the
Regional Council may exercise its functions to avoid, remedy or mitigate the effects
on fisheries resources of aquaculture
activities and of occupying a coastal marine
area for the purpose of those activities.
[100] In other words, at the relevant time
the Regional Council would then impose
the same test they would impose as regards sustainability issues if it was considering
an
application for a marine farm in an AMA. In my judgment, therefore, the
legislation had worked, and would in the future work,
as it was intended to do.
[101] I therefore find that the Chief Executive did not err in not making the marine
farming and spat
catching permits subject to a condition that any further staged
development could only occur if the s 67J(8) criteria continued to
be met as regards
the sustainability of fisheries resources.
Declaration: area restricted to stage 1
[102] In an alternative
pleading, expressed to be relied on if Sanford was
unsuccessful in its application for judicial review, Sanford seeks a declaration
that
the area of the permits does not, and cannot, extend beyond the area of stage 1. It
submits that the area covered by the permits
is the eight blocks only that there is no
clause in the permit providing that the stage 1 area limitation can be amended at
some
later point, and therefore the only area that can be used during the life of the
permit is the first 8 blocks. At the hearing, Mr
Scott acknowledged that, as pleaded,
that application for a declaration did not have any obvious jurisdictional basis. In
my judgment
that pleading is best understood, as I think both the Chief Executive
and Eastern Sea Farms through counsel acknowledged, as one
that seeks an order
that the permits, if they otherwise survive Sanford's challenges, are only valid as
regards the area comprising
the eight blocks.
[103] I think this argument can be best be answered by reference to the terms of the
permits themselves. The
marine farming permit as issued referred to an area
described in the attached Schedule B as the "permitted area". Schedule B referred
to
an area of 3,800 hectares situated approximately 8.5 kms (at its closest point) off
Opotiki, Bay of Plenty, and as pictured on
the attached maps.
[104] Therefore, and broadly as the Chief Executive submitted, in my view the
permits apply to the 3,800 hectare
area, and not the smaller area notionally created
by the division of the marine farm into twelve blocks, eight of which could be
occupied during stage 1. The area of the farm is expressly defined in Schedule B,
and its outer bounds are marked on the structures
plan for the first stage. The Chief
Executive's decision-making authority relates to the area of the farm, and not the
placement
of structures within it. That is a matter for the Regional Council.
Provided that no more than 256 lines were established, the
Chief Executive had no
particular concern where, within any part of the 3,800 hectare area, they might be
placed.
[105] On that
basis, I conclude that Sanford did not establish this part of its case
either.
Relief
[106] In addition to opposing Sanford's
substantive challenges, Eastern Sea Farms
argued that, in the event Sanford succeeded in its substantive challenges, the Court
should
nevertheless decline to grant relief. Indeed, Eastern Sea Farms' oral
submissions before me focused primarily on this aspect.
It argued that relief should
be denied principally on the basis that Sanford's action in bringing its challenges was
inconsistent
with agreements reached between the parties, and by reference to delay.
In the alternative, Eastern Sea Farms submitted that any
relief should be limited to a
direction for a reconsideration of the grant of the permits, in terms of s 4(5) of the
Judicature Amendment
Act 1972.
[107] For completeness, and because of the comprehensive submissions addressing
this issue, I record that had I found in Sanford's favour as regards its challenges to
the
Chief Executive's decision, I would nevertheless have been minded to decline to
grant relief. In saying this I recognise that the
discretion not to grant relief is a
narrow one and "there must be extremely strong reasons to decline to grant relief":
Air Nelson
Ltd v Minister of Transport [2008] NZCA 26 at [60].
[108] First, I am satisfied, contrary to Sanford's submissions, that the December
2006 Decision was a reviewable decision.
[109]
Although the Fisheries Act 1983 clearly stipulates that marine farming and
spat catching permits may not be issued until after coastal
permits are issued, it is
clear from the December 2006 Decision and Mr Lees' evidence that that decision
was a "final decision in
principle", intended to "help expedite the Environment Court
case". Sanford itself referred to that decision as an "initial decision"
in an earlier
pleading. It only amended that pleading when faced with Eastern Sea Farms' delay
argument.
[110] Sanford argued,
however, that the conditions on which any permit would
issue were an inextricable part of the decision and that the form and content
of those
conditions were not made clear until the 2008 decision and, indeed, the final
conditions were different from those suggested
in the December 2006 Decision. It
could not, therefore, have reviewed that decision. I am not persuaded by that
submission. As
noted above, in December 2006 Mr Lees stated as follows:
My decision is, therefore, to approve a marine farming permit and
spat
catching permit for the northern 3,800 ha block, but to condition the permit
under section 67(10)(c) of the Fisheries
Act 1983 to require the farm to be
developed in stages.
The permit conditions will initially only allow the first
stage of development
to occur, being 8 blocks and 256 longlines. ...
[111] Mr Lees further noted that approval of subsequent
stages would be for the
Regional Council. I find, therefore, that the material aspects of the permits that were
to be issued and
particularly that approval was restricted to 3,800 hectares and, by
condition, to the first stage and 256 longlines were clear
from that decision.
[112] That the conditions as imposed were ultimately different to those proposed in
December 2006 does not
mean that the earlier decision was not open to review at the
time it was made. The December 2006 Decision was sufficiently complete
and
definite to enable the parties to settle the outstanding RMA appeals. There is no
indication (in the December 2006 Decision or
evidence more generally) that the
Chief Executive was going to substantively review that decision after the coastal
permits had been
obtained. Many of Sanford's points in its application for review
and particularly in terms of the reasonableness of the decision
were evident as from
that date. It was, in my judgment, a final decision in principle as to how the Chief
Executive (through Mr
Lees) intended to exercise his statutory power and was
reviewable by Sanford from that time. It was not "putting the cart before
the horse"
to expect Sanford to challenge that decision rather than wait for the permits to be
granted.
[113] In my view, therefore,
the December 2006 Decision was a "proposed exercise
by any person of a statutory power" in terms of s 4 of the Judicature Amendment
Act
1972, and open to review.
[114] Sanford brought these proceedings over two years after that decision. I am
not persuaded by
Sanford's submission that that delay was the result of Eastern Sea
Farms' decision not to follow "the correct sequence" for decision
making in respect
of a marine farming application. As discussed above, the legislation allows for
simultaneous progression of applications
for coastal permits and marine farming/spat
catching permits, provided that the latter are not issued before the applicable coastal
permits have been granted.
[115] I therefore find that Sanford's delay in bringing these proceedings would
have weighed against
this Court exercising its discretion to provide relief, in light of
the prejudice that would accrue both to Eastern Sea Farms and
third parties
(including the Opotiki District Council and Regional Council) who have acted in
reliance on that decision. In this
context, I note that Eastern Sea Farms provided an
affidavit from the Mayor of Opotiki District Council, Mr John Forbes, setting out the
way in which that Council had supported
Eastern Sea Farms' application, the
economic significance of that application for the district and the expenditure of the
District
Council in participating as a s 274 party in Eastern Sea Farms' RMA
application, and associated matters particularly since December
2006.
[116] In addition, and in my view even more significantly, I find as an inescapable
inference that Eastern Sea Farms relied
on the December 2006 Decision, with
Sanford's acquiescence (if not encouragement), in settling the appeals in relation to
the coastal
permits.. As noted above, in June 2005 the parties to the Environment
Court appeals (including Sanford) obtained an adjournment of
those proceedings in
anticipation of the Chief Executive's decision. This was on the basis that that
decision would allow the parties
to decide whether the appeals could be withdrawn,
settled by consent, or would need to proceed to hearing. After the December 2006
Decision Eastern Sea Farms amended its coastal permit applications in line with that
decision including restricting the area to
which the applications related and altering
the development staging. On that basis, the parties including Sanford sought
consent
orders from the Environment Court. Moreover, in proceeding in that
manner, Sanford did not reserve its rights to challenge
the December 2006 decision
(in the context of other fishing company appellants doing so). In these
circumstances,
it is my view that Sanford's conduct militates further against a grant
of relief.
[117] Together, these considerations would have
persuaded me that extremely
strong reasons did exist to decline to grant relief to Sanford in these circumstances.
Whether I would
have done so would, in part, have depended upon the view I took as
to the significance of the reasons for deciding that the permits
were not valid. As
that was a conclusion I did not reach, I do not consider it appropriate to express a
further view on this aspect
of these proceedings.
Counterclaim
[118] Lastly, Eastern Sea Farms raised a counterclaim, which it accepts is only
relevant if
Sanford succeeds, seeking a declaration that, in determining whether a
marine farming or spat catching permit will have an "undue"
adverse effect on
fishing or the sustainability of fisheries resources under s 67J(8) of the Fisheries Act
1983, the Chief Executive
is required to take into account the benefits to be gained
from the proposed marine farm, including likely benefits for marine farmers
and the
public generally from aquaculture.
[119] The Chief Executive opposed that counterclaim.
[120] Given my findings above
it is not necessary for me to determine this issue.
Having said that, I record my provisional view that, under s 67J(8), the Chief
Executive was not required to take into account likely benefits for marine farmers
and the wider public arising from the aquaculture
proposal.
[121] In my view, the s 67J(8) test is in essence a threshold test. The Chief
Executive may only issue a marine farming
(or spat catching) permit if doing so
would not result in undue adverse effects on fishing and the sustainability of
fisheries resources.
It in effect provides protection for the existing (property) rights
of the existing commercial, recreational and customary fishers.
It does not provide
for a balancing process whereby the undue adverse effects on fishers or the
sustainability of fisheries resources
are to be weighed against the potential benefits to
marine farmers or the public generally.
[122] This interpretation receives
support from a consideration of the test as it
exists under the New Regime. As noted above, the Chief Executive is required to
determine
(under s 186E) whether he or she is satisfied that an AMA "will not have
an undue adverse effect on fishing". Section 186G expressly
stipulates the factors
that the Chief Executive "must have regard only to" in making that decision, namely:
(a) the location of the aquaculture
management area in relation to areas in
which fishing is carried out:
(b) the effect of the aquaculture management
area on fishing of any fishery,
including the proportion of any fishery likely to become affected:
(c) the degree
to which aquaculture activities within the aquaculture
management area will lead to the exclusion of fishing:
(d) the extent to which fishing for a species in the aquaculture management
area can be carried out in other areas:
(e) the extent to which the aquaculture management area will increase the
cost of fishing:
(f) the
cumulative effect on fishing of any previous aquaculture activities.
[123] Reporting on the Aquaculture Reform Bill in which s
186G was first
introduced the Primary Production Select Committee commented on the undue
adverse effect test, and s 186G criteria,
as follows (at 12):
We recommend an amendment to clause 41, deleting subclause 186G(g),
namely the phrase ``any
other matter'' in order to provide more certainty as
to the matters the chief executive of the Ministry of Fisheries can
consider in
considering the undue adverse effects test. Submitters felt this phrase
negated the purpose of providing
criteria for the administration of the undue
adverse effects test. Submitters also differed about the kind of criteria that
the undue adverse effects test requires. In particular several submissions
called for the addition of criteria that
would allow a comparison of value
between fishing and farming use of coastal marine areas. That is a balancing
test
and not the purpose of the test in the bill. The test in the bill is a
threshold test, which is an assessment of the degree
to which a new use of
coastal space, in this case marine farming, will affect the exercise of fishing
rights that
already exist in the area. If the effect is sufficiently adverse to
amount to an undue adverse effect, it should not proceed,
unless an
aquaculture agreement can be reached with the affected fishers.
[124] There is no indication in the Select Committee
commentary, or in Hansard,
that this amounted to a change as regards the considerations taken into account under
the test in s 67J(8).
[125] It is therefore my view that, as under the New Regime, the undue adverse
effects test under s 67J(8) does not require the
Chief Executive to balance the
adverse effects on fishing and the sustainability of fisheries resources against the
wider public
benefits and benefits to the marine farmers to determine whether those
effects are "undue". Rather, the test is a threshold test
such that, where the adverse
effects are sufficiently adverse to be undue adverse effects, the application for the
permit must be
refused.
[126] As such, had I been required to do so, I would have found in favour of the
Chief Executive on the counterclaim brought
by Eastern Sea Farms.
Result
[127] I have found against Sanford on each of its grounds of review and in its
application for a
declaration. As such, I have not been required to finally determine
the counterclaim brought by Eastern Sea Farms.
[128] In my
judgment there is no reason why costs should not be awarded against
Sanford in the usual way. I therefore order costs against Sanford
on a 2B basis. If
the parties are unable to agree on costs, memoranda may be filed within 21 days.
"Clifford J"
Solicitors: Chapman Tripp, P O Box 993, Wellington 6140
for the applicant
(bruce.scott@chapmantripp.com; carolyn.elliott@chapmantripp.com).
Crown Law Office,
P O Box 2858, Wellington 6140 for the first respondent
(peter.mccarthy@crownlaw.Government.nz).
Duncan Cotterill, P O Box 10-376, Wellington 6143 for
the second respondent.
(counsel: francis.cooke@chambers.co.nz).
NZLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.nzlii.org/nz/cases/NZHC/2009/1412.html