In this edition

Regulation of activities in the Exclusive Economic Zone - a sea change in offshore environmental management?
The Minister for the Environment and the Minister of Energy and Resources have recently sent strong signals that legislation to regulate the environmental effects of activities in New Zealand's Exclusive Economic Zone ("EEZ") is high on the Government's "complete by year-end" priority list. more ...

Green light for green-lipped mussels - record marine farm approved
The largest aquaculture development in Marlborough's history was given the green light by a Ministry of Fisheries decision announced on 1 July 2010. more ...

Discounts for delays - how will the application experience differ?
The Resource Management (Discount on Administrative Charges) Regulations 2010 ("Regulations") were promulgated by Order in Council in late June. more ...

Developments at the Ministry of the Environment
The Ministry for the Environment is hard at work on a number of aspects of environmental consultation and law reform. more ...

Canterbury Commissioners take action
New Commissioners appointed in May 2010 have seen Environment Canterbury adopt its annual plan for 2010/2011 ("Annual Plan").  An annual plan is a plan that local authorities must adopt for each financial year which contains the proposed annual budget and funding impact statement. more ...

Damn the delays - Court refuses to delay Mokihinui dam appeals
The Environment Court has refused an application by Meridian Energy and the Department of Conservation ("DOC") to put on hold various appeals (including DOC's appeal) to Meridian's $300 million Mokihinui hydro scheme on the West Coast of the South Island. more ...

Public works offer back bill rejected
The Local Government and Environment Committee has reported back early on the Public Works (Offer Back of and Compensation for Acquired Land) Amendment Bill ("Bill") recommending that the Bill not be passed. more ...

Prosecutions under the RMA: comply with guidelines or face criminal charges
The recent High Court decision of Auckland Regional Council v Holmes Logging Limited HC Auckland CRI-2009-404-3 highlights the importance of compliance with all relevant documents in order to avoid prosecutions for breaches of the RMA. more ...

To lapse or not to lapse? An investigation into lapse periods for designations
A recent decision of the Environment Court has considered the principles to apply in a determination of whether a longer lapse period for a designation is appropriate. more ...

Cabinet decision announced on mining in the conservation estate
The Minister of Energy and Resources Hon Gerry Brownlee has announced that the Government no longer plans to remove any land from Schedule 4 of the Crown Minerals Act 1991 ("Schedule 4") for the purpose of further mineral exploration or extraction. more ...

The Minister for the Environment and the Minister of Energy and Resources have recently sent strong signals that legislation to regulate the environmental effects of activities in New Zealand's Exclusive Economic Zone ("EEZ") is high on the Government's "complete by year-end" priority list.

The EEZ is the area of sea and seabed that extends from 12 to 200 nautical miles offshore and which falls outside of the jurisdiction of the Resource Managment Act 1991 ("RMA"), which extends only to the 12 nautical mile limit.  New Zealand's EEZ includes the fourth largest collection of deep water basins in the world, as well as a range of potential economic opportunities.  Activities regulated by the new legislation may include seabed mining, petroleum activities, energy generation, carbon capture and storage, and marine farming. (Existing laws for fisheries and maritime transport will continue to operate largely as at present, and will not require any further consents.)

Against the backdrop of BP's recent deep sea drilling incident in the Gulf of Mexico, the Government's policy of advancing the exploration and production of nationalised minerals (oil, in particular, was New Zealand's largest export earner in 2009), and the recent granting of petroleum exploration permits to Brazilian company Petrobras for 12,000 square kilometres off the North Island's East Cape, debate about appropriate regulation of the EEZ may be well overdue.  New Zealand needs to provide responsible access to its oceanic resources, while ensuring such access does not threaten the integrity of oceans and ecosystems.

MfE concluded as early as 2006 that legislation was required to fill gaps in the existing regulation of the EEZ and to promote a consistent approach to environmental management in the area.  While the Labour Government had prepared such legislation, it did not introduce any bills into the House.  However, current Minister for the Environment Hon Nick Smith has signalled an intention to progress the former proposals, albeit with some amendments.  Given the Government's upcoming RMA Phase II reforms, and the birth of the Environmental Protection Agency ("EPA"), the timing might be right for legislation promoting the responsible management of the EEZ to be introduced to the House before 2011, and responsibility for the EEZ to be handed to the EPA (which will incorporate the existing Environmental Risk Management Authority).

Cabinet papers suggest that an RMA-type system may be proposed, with features that include:

While speculation suggests that the EPA will be appointed the relevant consenting authority, this is by no means a foregone conclusion, as recent comments from the Minister for the Environment have stopped short of confirming the EPA's role.  Alternatives recorded in cabinet papers include the appointment of an EEZ Commissioner within MfE, who would be responsible for day to day operational administration of the legislation and make recommendations on consent applications to the Minister for the Environment.  In the meantime, the Ministries have commissioned external consultants to prepare a report comparing New Zealand's existing health, safety and environmental legislation for offshore petroleum operations to international best practice.  That report is to be completed by 3 September 2010.

The largest aquaculture development in Marlborough's history was given the green light by a Ministry of Fisheries decision announced on 1 July 2010.

The application was made by Wakatu Incorporation Limited ("Wakatu") - an iwi owned entity - to establish a green-lipped mussel aquaculture space of 770ha in Tasman Bay, near the Northern tip of the South Island.  This overtakes the 424ha Clifford Bay development, approved in late 2009, as the largest marine farm in Marlborough.  When completed, the proposed farm will comprise 350 longline backbones, each with a length of 200m, separated by 50m navigation channels.

The Wakatu application is one of the last remaining aquaculture applications to be processed under the Fisheries Act 1983.  It was originally notified by the Marlborough District Council, a unitary authority, prior to the moratorium on aquaculture development coming into effect in November 2001. Pursuant to the Aquaculture Reform (Repeals and Transitional Provisions) Act 2004, this meant that the applicant was required to obtain both a resource consent from the Council, and a marine farming permit from the Ministry of Fisheries. 

Under the Fisheries Act, the relevant statutory test meant that the Ministry could only issue the marine farming permit if satisfied that the proposed aquaculture space would not have an undue adverse effect on fishing (commercial, recreational, or customary) or on the sustainability of any fisheries resource.

Wakatu had previously been unsuccessful in obtaining a marine farming permit at the same site, with a decision issued in 2007 declining an earlier application lodged in 2003, citing adverse effects on the commercial flatfish fishery in the area.  Second time around however the Ministry, armed with improved evidence, was satisfied that the activities contemplated by the application would not have an undue adverse effect on fishing or any fisheries resource. 

The assessment of effects largely focussed on:

The decision adopted a pragmatic approach to the scientific uncertainty inherent in the marine farming sector, requiring the farm to be developed in four stages.  Environmental monitoring will punctuate each stage, in step with an adaptive management regime approved by the Marlborough District Council.  The adaptive management programme, set out in detail as a condition of consent, requires:

Before exercising the consent, Wakatu must also prepare an environmental monitoring programme, biosecurity plan, and a survey plan for certification by the council.

Given the proposed RMA Phase II reforms aimed at "re-starting aquaculture" through the development of an effective and enabling aquaculture regulatory system, it will be interesting to see whether the pragmatic and flexible approach adopted by this decision (decided under a hybrid system of new and old law), will continue.

The Resource Management (Discount on Administrative Charges) Regulations 2010 ("Regulations") were promulgated by Order in Council in late June. Readers may recall that the Regulations provide resource consent applicants with discounts of up to fifty percent off the administrative fees charged by local authorities if the local authorities are responsible for failing to meet the RMA's statutory time periods for the consenting process.

The Regulations are in substantially the same form as the document previously issued by the Ministry for the Environment ("Ministry"), and accompanied by an Implementation Guidance paper ("Guidance").  The Guidance gives stakeholders an insight into what practical changes they might now experience during the consenting journey.

The Ministry is clear that the discounts will apply only to applications for resource consent (or changes to conditions of resource consents) and not to other applications, such as those for:

• local authority initiated consent reviews;
• certificates of compliance or existing use certificates;
• notices of requirement for designations or heritage protection orders;
• outline plans or survey plans; or
• water conservation orders.

Potential changes to the processing procedure

The Ministry suggests a number of best practice measures that local authorities should adopt to ensure that statutory deadlines are met.  During the consenting process, applicants can expect to see increased use of the following:

• Pre-application and pre-lodgement meetings to fully understand the application, and relevant supporting information, prior to lodgement.
• Local authorities' ability, under section 88(3) of the RMA, to return an application to the applicant within 5 days of lodgement on the basis that it is incomplete or inadequate.  (In that case, the timeframe clock for discounts will only start ticking when the application is re-lodged with the local authority.)  The Ministry also suggests using this mechanism when the source of the delay in processing an application is delayed input from external agencies (such as the New Zealand Transport Agency or the New Zealand Historic Places Trust).
• The extension of statutory timeframes under section 37 of the RMA with the agreement of the applicant, or in special circumstances.  We note that neither the RMA nor the Regulations define what will constitute "special circumstances", but the Guidance records that that they are unlikely to exist only because of high workload or internal resourcing issues.
• Given the frequency with which iwi/hapu input is required to understand the nature and effects of an application proposal, closer relationships between local authorities and tangata whenua groups and regular meetings to discuss upcoming consent applications.
• In cases of competing resource consent applications for a finite resource, the extension of timeframes under section 37.  In this scenario, processing delays may otherwise be caused by the rule that priority in proceeding to a hearing should be given to the first complete application if not disqualified by unreasonable delay (Central Plains Water Trust v Synlait Ltd [2008] NZRMA 200 (CA)).  If timeframes for second and subsequent applications are not extended while the first application is determined, it is likely that their total processing time will exceed statutory processing timeframes.

When is a delay the fault of the local authority?

Neither the Regulations, nor the Guidance, provide a complete answer to what will constitute a local authority being "responsible" for failing to meet a statutory time period, and therefore being liable for a discount.  However, it is clear that time periods caused by certain events will be specifically excluded from the calculation of the time taken to process an application.  The implication is that local authorities will not be responsible for any delays within these categories, and will not be required to grant discounts for associated delays.

These "excluded days" include:

• Days on which the local authority does not process the application because it has not received appropriate payment from the applicant.
• Days that are part of an extension to the statutory time periods under section 37 of the RMA (extensions to timeframes by agreement with the applicant or in special circumstances).
• Days that are excluded under the RMA as a result of a further information request, a direct referral to the Environment Court, or certain other matters such as the commissioning of reports, or the application being referred to mediation.
• Days during which a hearing is being held on the application - the clock is stopped from the working day before a hearing begins until the day after the hearing is closed, including any adjournments.  (The requirement under section 103A, that a hearing must be concluded no later than 10 days after the applicant's right of reply, remains.)
• Days during which a local authority does not process the application for any other reason in the RMA, any other enactment, or any rule of law.
• In the case of an applicant changing its application, and the local authority consequentially re-notifying the application, days between when the application was first notified and subsequently re-notified.

In circumstances where an applicant requests that the processing of an application is placed on hold, the processing timeframe is suspended accordingly.  To avoid accumulating a backlog of on-hold applications, local authorities may be more inclined to extend the processing timeframes with the applicant's approval under section 37, or request that the application simply be withdrawn and re-lodged at a later date.

As an aside, an application (or other information or document) is considered to be "received" by a local authority either when it physically enters the local authority building, or when it is received in the local authority's email inbox.  Local authorities will still potentially be liable for delays caused by internal delays in moving the application to the appropriate council officers.

Discount delivery

Recipients of discounts can expect that discounts will factored into the invoices for processing, which will be delivered as soon as possible after the notice of decision has been issued.  The Ministry recommends that any applicable refund be paid to an applicant as soon as reasonably practicable.  The Ministry has also provided local authorities with template discount letters and forms, so applicants should expect a degree of consistency across the country.

In the event of a dispute as to the time taken to process an application, or the appropriate discount due, the Ministry recommends that local authorities be open to re-considering their calculations.  Should a dispute remain, it seems that the Office of the Ombudsmen will be able to assist applicants.

Further guidance is provided in respect of applications lodged with the local authority and subsequently called-in by the Minister for Environment, direct referrals to the Environment Court, and replacement consents.  We expect that the RMA Phase II reform discussion document, due in August 2010, will discuss the application of the discounting regime EPA processes and associated matters.  In the meantime, applicants will discover from 31 July 2010 whether the disincentive of discounts payable by local authorities delivers the streamlined process promised by Government.

The Ministry for the Environment is hard at work on a number of aspects of environmental consultation and law reform.

Phase II RMA reforms

The Phase II reforms are intended to address fundamental issues with the existing legislation, such as improving the relationship between the desired economic and environmental outcomes of the RMA.  As well as focussing on specific priority areas, the Government is looking in Phase II to increase efficiencies by aligning RMA processes with those set out in other statutes.

Phase II comprises 10 work streams:

The scoping of certain work streams and drafting of possible legislation has involved technical advisory groups providing advice on issues associated with each of the work streams. In addition, the Minister has indicated that there will be upcoming opportunities for public consultation and engagement.

Two technical advisory groups have been appointed:

Both of these groups were due to have reported back to the Government already, but are now expected to report towards the end of August.

Freshwater - the Land and Water Forum

The Land and Water Forum ("Forum") is due to report to the Government on 31 August 2010 with its recommendations on outcomes, goals and long-term strategies for the use of fresh water in New Zealand.

The Forum comprises a range of primary industry groups, environmental and recreational NGOs, iwi and other organisations with an interest in fresh water and land management.  The Minister for the Environment and the Minister of Agriculture and Forestry have asked the Land and Water Forum to advise on how water should be managed in New Zealand. The Forum has been joined specifically for that task by active observers from central and local government.  This collaborative project is based on the Scandinavian approach to developing water policy, and, given the Forum's diverse membership, may produce some truly innovative outcomes.

The Forums’s objectives are to:

The Forum's report is likely to go to Cabinet later this year, with the Government's preferred policy package released for public consultation in early 2011.  Major policy decisions will likely follow only after mid-2011.

New Commissioners appointed in May 2010 have seen Environment Canterbury adopt its annual plan for 2010/2011 ("Annual Plan").  An annual plan is a plan that local authorities must adopt for each financial year which contains the proposed annual budget and funding impact statement.

The Annual Plan provides that the overall rise in regional rates will be 3.3 percent, rather than the 9 percent rise which had been proposed under the draft annual plan by the regional council before the commissioners were appointed.  Overall expenditure will increase by $10 million from the previous year, with a total planned expenditure of $134 million planned.

Predictably, key shifts in funding relate to the fraught area of Canterbury's water resource.

• Firstly funding for the Canterbury Water Management Strategy has been increased by $3.2 million to $4 million.  The development of the Canterbury Water Management Strategy has been a co-operative project involving the Canterbury region's territorial authorities and Environment Canterbury.  The Creech report, which recommended that Environment Canterbury be sacked and replaced by Commissioners, was generally positive towards the Canterbury Water Management Strategy stating; "The intentions behind the CWMS are laudable and it is very widely supported throughout the Region, with all stakeholders recognising the imperative of solving the water problem in Canterbury."  The Annual Plan shows that the Commissioners see the Canterbury Water Management Strategy as being part of the answer to the region's water woes.
• A new charge on water consent holders will be introduced to recover 30 per cent of the cost of scientific investigation and monitoring work for water management. The remaining 70 per cent will continue to come from general rates.   The overall effect will be to reduce the general rate by $2.3 million.  The scientific costs of water management are a significant part of Environment Canterbury's expenditure, with the new charge indicating a shift towards a user pays system.

A number of changes have been made to the 2010-2011 work plan, as a result of almost 450 submissions received on the draft plan.

The Environment Court has refused an application by Meridian Energy and the Department of Conservation ("DOC") to put on hold various appeals (including DOC's appeal) to Meridian's $300 million Mokihinui hydro scheme on the West Coast of the South Island.

Background

Consent was granted in early April this year for Meridian's proposed 85m high, 300m wide hydro dam.  The project will create a 14km lake inundating approximately 225ha of public conservation land in the relatively unmodified Mokihinui Gorge.  DOC opposed the proposal, arguing that the hydro scheme and its associated infrastructure would have significant adverse effects on the river, forests, and on threatened native wildlife.  In contrast, Meridian stressed that the project had the "overwhelming support" of locals and would improve security of electricity supply to the region.

Following the finely balanced Hearing Committee decision granting consent by a two to one majority, DOC was one of a number of parties to appeal to the Environment Court.

The hydro project is proposed on stewardship land administered by DOC, and consequently requires the Minister of Conservation's consent to proceed, in addition to the usual resource consents.

The hold application

Both Buller District and West Coast Regional Councils supported the joint memorandum of the parties requesting a hold on the appeals.  But, through a minute to the parties, Environment Judge Borthwick stated that she was not prepared to place the appeals on hold for what would effectively amount to an indefinite period.  Despite the appeals not being placed on hold, the matter is unlikely to proceed to hearing until the second quarter of 2011, with a lengthy timetable for evidence exchange being set down.

Meridian and DOC had applied for the appeals to be suspended, prior to seeking consent from the Minister, while they worked through controversial issues surrounding land access.  They reasoned that this approach would be the most logical, cost-effective, simple, and efficient process to advance proceedings. 

Meridian and DOC had proposed to report back to the Court on progress after six months.  Such an approach may have allowed the parties to canvass and resolve at the outset some of the matters that would subsequently be raised by the Minister when considering whether to grant consent. 

Earlier, Meridian had withdrawn applications filed with DOC (seeking concessions and a land swap) in an attempt to gain more time to resolve the outstanding issues.

What now?

This case highlights a common tension throughout resource management decision-making as to the trade off between the speed of achieving a resource management outcome versus the quality of the process and outcome.  Here, Meridian and DOC were seeking more time to pursue what they perceived to be a better process/outcome through a more conceptually efficient, commonsense approach.  It would appear that, in this case, a premium was put on obtaining a swift resolution.

The Local Government and Environment Committee has reported back early on the Public Works (Offer Back of and Compensation for Acquired Land) Amendment Bill ("Bill") recommending that the Bill not be passed.

The Bill was introduced as a Member’s bill in July 2007 by Te Ururoa Flavell, and was referred to the Select Committee on 17 June 2009.  The Bill seeks to ensure that former owners of Maori or general land taken or acquired by the Crown for the purposes of a public work are given the first right of refusal to purchase that land where the Crown no longer requires it for the public work for which it was originally taken / acquired.

The Committee received 71 submissions which expressed widely differing views on the content of the Bill.  The primary reasons cited by the Committee for its recommendation are:

The Committee stated that Hon Mr Flavell has admitted that the Bill was flawed in terms of the amendments it sought to make to the Public Works Act (1981 ("PWA").   A wholesale review of the PWA has been requested as a result of issues raised by the Bill, particularly to take into account Treaty of Waitangi issues.  

View the Select Committee's report here.

The recent High Court decision of Auckland Regional Council v Holmes Logging Limited HC Auckland CRI-2009-404-3 highlights the importance of compliance with all relevant documents in order to avoid prosecutions for breaches of the RMA.

The Auckland Regional Council ("ARC") had laid a number of criminal charges against Holmes Logging Limited ("Holmes"), and also against Kenneth Holmes as a director of the company, for breaches of sections 9 and 15 of the RMA.  Judge Thompson in the Auckland District Court had dismissed all charges.  The ARC subsequently brought an appeal to the High Court on points of law by way of a case stated under Section 107 of the Summary Proceedings Act 1957.  

It was alleged that Holmes had undertaken logging in a manner that contravened the rule in the relevant regional plan that dealt with sediment control, contrary to section 9 of the RMA.  Holmes was also charged with discharging sediment into the Puhoi River and tributaries of the Mahurangi River, contrary to section 15 of the RMA.  These sections only allow such activities if they are expressly authorised by a resource consent.

Holmes had effectively inherited its resource consent from the previous forestry operator on the site.  It was evident that Holmes had not complied with the original and revised ARC technical publications (TP2 and TP90) which set out erosion and sediment control guidelines for the specific activities undertaken on site.

The limits to an appeal by way of case stated were fully discussed in Auckland City Council v Wotherspoon [1990] 1 NZLR 76 (HC).  The Court in Holmes was content to apply that previous authority, and determined that this case fell within one of the three categories outlined in Wotherspoon namely a conventional legal question (or a number of questions in this case) on unchallenged facts.  The Court applied the Wotherspoon test to each question appealed by the Council to determine whether it was a question of fact or of law.  Only those that were questions of law could be examined by the Court.  In this case, there were 10 total questions on appeal: six relating to the charges under section 9, and 4 to those under section 15.

Firstly, it was questioned whether the lower Court had been correct that the prosecution was required to establish, beyond reasonable doubt, that the land use activities were not expressly allowed by a resource consent granted by the ARC.  The decision of the District Court had treated the words "unless... expressly allowed by a resource consent" in section 9 as an element of the offence.  However, the High Court found that this was not correct.  The offence contained only two elements: first, that the defendant used land; and second, that the activities undertaken on the land contravened a rule in the regional plan.  The third aspect whether expressly allowed by a resource consent, should have been treated as a justification, with the onus being on the defendant to prove, on the balance of probabilities, that their activities were expressly allowed by the resource consent.  As such, the earlier Holmes judgment was found to be incorrect in this respect.

The District Court had agreed with the defendant that compliance with TP90 and TP2 was not compulsory, as they were intended merely as guidelines.  The evidence, unchallenged by Holmes, plainly established that the defendant had not complied with these documents.  However, Holmes argued that these documents were meant to aid in interpretation of the rules, and were not meant to be strict extensions of the rules.  However, it was held that the words "these measures should be implemented in accordance with TP90" in the regional plan created a mandatory obligation to comply with the publication in order to comply with the rule itself.  Consequently, TP90 had legal effect as part of the plan.  The High Court applied a similar analysis to TP2, and found that the condition in the resource consent requiring that all forestry operations "shall be carried out in accordance with TP2" likewise created a mandatory obligation to comply with the document.  As such, the High Court took the view that it was compulsory to comply with these documents under the regional plan and the resource consent, and that the earlier decision was therefore substantially in error on these grounds. 

However, as to the four questions regarding the charges under section 15, the Court determined that two of them did not establish errors of law, and so it would not be appropriate for him to answer them in the form stated.  Furthermore, he determined that the earlier decision was not in error in respect of the other two questions.  As such, there was no error of law with respect to the dismissal of the charges under section 15 of the RMA.

The High Court concluded that there were errors of law in respect of the charges under section 9 of the RMA, but not in respect of the charges under section 15.  The Court did not consider that it had jurisdiction to enter a conviction in place of the dismissed charges, as requested by the prosecution, according to the authority of Lyons v Ching (1983) 1 CRNZ 69.  Instead, Woodhouse J set aside the dismissal of the charges in respect of the breaches of section 9 only, and remitted the case back to the District Court for reconsideration in light of the errors made.

It is important to recognise and remember in cases such as this that the onus will be on the defendant to prove that any activities undertaken were expressly allowed by a granted consent.  In addition, identification of, and compliance with, regulations such as technical publications is of paramount importance in avoiding potential prosecutions for breaches of the RMA.  As Holmes discovered, such documents are not always intended merely as guidelines, and may require specific adherence with their contents in order to remain within the bounds of a given resource consent.

A recent decision of the Environment Court has considered the principles to apply in a determination of whether a longer lapse period for a designation is appropriate. The requirement for a designation to lapse within a specified period is vital as it recognises that a planning consent is granted in light of present and reasonable foreseeable circumstances.  It has been held that to allow a designation to continue indefinitely would provide a 'fixed opportunity' and ignore the dynamic nature of the environment in which it exists.¹

While section 184(1) of the RMA provides that a designation will lapse after a 5 year period of its inclusion in a plan, there is a general discretion to impose a longer or shorter lapse period. However, the RMA does not provide any guidance as to the principles that are to be applied in determining an alternative lapse period.² Such discretion has caused concern for property owners whose properties are effectively blighted by the effects of a designation over their properties for indeterminate periods, especially where there is no evidence of any intention of the requiring authority to proceed with the work.

The Court in Beda Family Trust v Transit NZ EnvC A139/04, examined the principles which should apply to determinations for a longer lapse period, and the Court held that in exercising this discretion there needed to be a balance between the need to secure the property for future infrastructure development, and the prejudicial effects of such designation on property owners, whose ability to use and/or deal with their properties is effected by the designation.³  Ultimately, discretion is a question of fairness to both parties.

The recent Environment Court decision of Hernon v Vector Gas [2010] NZEnvC 203 has confirmed the approach adopted in Beda. Hernon concerned a partially successful appeal by Mr Hernon and Mr Taylor, as trustees of Jubilee Trust, against the decision to grant a designation to Vector Gas Limited ("Vector").  Vector sought a lapsing period of 10 years, rather than the statutory period of 5 years.⁴   The fundamental concern of the Jubilee Trust was the interim effect of the designation over their property prospects into the future. 

The Court was particularly interested in the justification for fixing the designation at 10 years, especially since the parties could offer little evidence as to the appropriateness of this timeframe. In considering whether 10 years was an appropriate lapse period, the Court considered the issues raised in Beda supporting a longer term. These issues were:

The Court considered each of these issues in turn and found that:

• Although Vector had provided no timeframe as to when the project would be implemented, it was likely to know in 5 years whether it still required the designation.
• A 5 year designation would deter prospective purchasers just as much as a 10 year designation.
• A shorter period would provide greater certainty to both parties.
• A shorter period would facilitate and spur the negotiation of an access agreement between the parties.

The Court noted that the designation process is subject to Part 2 of the RMA and that Part 2 is enabling, not just to the designating authority but the landowner as well.  Ultimately the Court held that the balance between the interests of the owner and the designating authority and Part 2 of the RMA justified the adoption of the 5 year standard lapse period outlined in s184(1).

The Courts approach to lapse periods in Hernon and Beda highlights the importance placed on finding a balance between the interests of infrastructure developers and landowners. In Hernon, the Court held that a shorter lapse period would not only provide certainty to land owners and prospective buyers as to the effects on the property but would also facilitate future agreements between the parties in regard to access.  Parties seeking to impose a longer lapse date than the 5 year statutory period will require substantive justifications in order to shift the balance in favour of infrastructure developers.

The Minister of Energy and Resources Hon Gerry Brownlee has announced that the Government no longer plans to remove any land from Schedule 4 of the Crown Minerals Act 1991 ("Schedule 4") for the purpose of further mineral exploration or extraction.

In the wake of numerous submissions and considerable public opposition to the proposal, the announcement confirms widespread speculation that the Government would reverse its opinion on the proposal.  Other key aspects of the announcement include the automatic inclusion of Schedule 4-equivalent land (such as national parks and marine reserves) in Schedule 4, confirmation of the Government's proposal to add a further 14 areas (totaling 12,000 hectares) of land to Schedule 4, and a new plan to undertake aeromagnetic surveys of mineral potential in Northland and the West Coast of the South Island.

The media has been quick to criticise the Government's back-down, with some commentators describing the move as "an embarrassing u-turn for National".  However, Hon Gerry Brownlee said that the decision reflected the fact that Government was undertaking a genuine consultation process, and that process had been valuable in raising awareness of the considerable mineral potential that New Zealand possesses.

Read more about the consultation process and key aspects of the announcement in Russell McVeagh's Mining Update here.

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