Trans-Tasman Resources Ltd v Taranaki-Whanganui Conservation Board
[2020] NZCA 86
•3 April 2020 at 3.00 pm
| IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA |
| CA573/2018 [2020] NZCA 86 |
| BETWEEN | TRANS-TASMAN RESOURCES LIMITED |
| AND | TARANAKI-WHANGANUI CONSERVATION BOARD, |
| AND | ENVIRONMENTAL PROTECTION |
| Hearing: | 24–26 September 2019 | |
Court: | Kós P, Courtney and Goddard JJ | |
Counsel: | J B M Smith QC and V N Morrison-Shaw for Appellant | |
Judgment: | 3 April 2020 at 3.00 pm | |
JUDGMENT OF THE COURT
AThe appeal is dismissed. The High Court’s decision to allow the first respondents’ appeal and quash the decision of the Decision-making Committee is upheld on other grounds.
B In so far as the first respondents’ cross-appeal seeks the appellant’s application for a marine consent and marine discharge consent to be declined, that cross-appeal is dismissed.
CThe appellant’s application is referred back to the Environmental Protection Authority to be considered in light of this judgment.
DWe award costs as follows:
(a)We award one set of costs to Te Rūnanga o Ngāti Ruanui Trust, the Trustees of Te Kahui o Rauru Trust, Te Ohu Kai Moana Trustee Ltd, Cloudy Bay Clams Ltd, Fisheries Inshore New Zealand Ltd, New Zealand Federation of Commercial Fishermen Inc, Southern Inshore Fisheries Management Co Ltd, Talley’s Group Ltd and the Taranaki-Whanganui Conservation Board for a complex appeal on a band B basis. We certify for two counsel with usual disbursements.
(b)We award costs to The Royal Forest and Bird Protection Society of New Zealand Inc for a complex appeal on a band B basis, for one counsel only, with usual disbursements.
(c)We award one set of costs to Kiwis Against Seabed Mining Inc and Greenpeace of New Zealand Inc for a complex appeal on a band B basis, for one counsel only, with usual disbursements.
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Table of Contents
Para No
The appeals before this Court
Summary of outcome
The structure of this judgment
The EEZ Act
International law context for New Zealand’s EEZ Act
The EEZ Act
How should the EPA have approached the decision on TTR’s marine discharge consent application?
Challenges to the decisions below
Approach to s 10 purpose statement
The issue
DMC decision
High Court decision
Submissions in this Court
Analysis
Failure to apply information principles
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Approach to the Treaty of Waitangi, tikanga Māori and kaitiakitanga
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Other marine management regimes: RMA and NZCPS
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Did the DMC adopt an adaptive management approach?
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Conditions in relation to bond and insurance
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Effects on seabirds and marine mammals
The issue
DMC decision
High Court decision
Submissions on appeal
Analysis
Other issues raised by cross-appeals
Obtaining information from submitters
Best available information
Relevance of international law
Pre-commencement monitoring
Casting vote
Iterative approach to information gathering from TTR
Failure to identify net economic benefits
Conclusion
Result
REASONS OF THE COURT
(Given by Goddard J)
The United Nations Convention on the Law of the Sea (LOSC) provides that New Zealand has a duty to protect and preserve the marine environment.[1] New Zealand has the sovereign right to exploit the natural resources of its exclusive economic zone (EEZ) pursuant to New Zealand’s environmental policies, and in accordance with that duty. The Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 (the EEZ Act) provides for the use of the natural resources of New Zealand’s EEZ in a manner that is consistent with New Zealand’s international law obligations, including the LOSC duty to protect and preserve the marine environment.[2]
[1]United Nations Convention on the Law of the Sea 1833 UNTS 3 (opened for signature 10 December 1982, entered into force 16 November 1994).
[2]Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012, s 11 [EEZ Act].
The Treaty of Waitangi (the Treaty) requires the Crown to respect the interests of iwi in relation to the marine environment and its resources, including (as we explain below) the kaitiakitanga relationship between iwi and the marine environment. The EEZ Act provides for decisions to be made about the use of the natural resources of the EEZ in a manner that recognises and respects the Crown’s responsibility to give effect to the principles of the Treaty.[3]
[3]EEZ Act, s 12.
This judgment is concerned with the consistency of decisions made by the Environmental Protection Authority (EPA) and the High Court with the provisions of the EEZ Act. That inquiry must be informed by the principles of international law to which the EEZ Act is intended to give effect, and by the principles of the Treaty as they apply to decisions made under the EEZ Act.
The appeals before this Court
The appellant, Trans-Tasman Resources Ltd (TTR), proposes to mine iron sands in an approximately 66 km2 area of the seabed in New Zealand’s EEZ, offshore from Taranaki. TTR holds a mining permit issued under the Crown Minerals Act 1991 in respect of its proposed seabed mining activities. In order to carry out those activities TTR also requires marine consents and marine discharge consents under the EEZ Act.[4]
[4]EEZ Act, s 20; and Exclusive Economic Zone and Continental Shelf (Environmental Effects—Discharge and Dumping) Regulations 2015.
In August 2017 TTR was granted marine consents and marine discharge consents by a Decision-making Committee (DMC) appointed by the EPA. The DMC received 13,733 submissions on the proposal. It sought additional information from TTR and from a number of other parties. It held a hearing which ran for 22 days over a three-month period. The four-person DMC was equally divided on whether the consents should be granted: the consents were granted as a result of the casting vote of the DMC Chair.
The consents granted by the DMC permit TTR to extract up to 50 million tonnes of seabed material per annum, and process that material on an Integrated Mining Vessel (IMV). Some 10 per cent of the seabed material extracted would be retained to be further processed into iron ore concentrate. The remaining material would be returned to the seabed. The “plume” of suspended sediment that would result from this discharge from the IMV is a discharge of harmful substances for the purposes of the EEZ Act, in respect of which TTR requires a marine discharge consent.[5] The likely environmental effects of the sediment plume were a central focus of the DMC assessment of TTR’s application. Other significant environmental effects would include the direct effect of mining on the seabed floor and benthos in the 66 km2 mining area, and the effect on marine mammals and other fauna of the noise generated by the mining activities.
[5]EEZ Act, s 20C.
The first respondents, who we will refer to simply as “the respondents”, participated in the hearing before the DMC and made submissions opposing the grant of the consents. They appealed to the High Court, arguing that the DMC decision was wrong in law on a number of grounds. The appeal was successful on one ground: the High Court held that the consents adopted an “adaptive management approach”, which the EEZ Act does not permit in relation to marine discharge consents.[6] The High Court quashed the DMC decision, and referred TTR’s application back to the DMC to consider in light of the High Court judgment.
[6]Taranaki-Whanganui Conservation Board v Environmental Protection Authority [2018] NZHC 2217, [2019] NZRMA 64 at [404] [High Court decision].
TTR appeals from the High Court judgment, arguing that the consents do not adopt an adaptive management approach and should not have been quashed.
The respondents seek to uphold the High Court decision. The respondents filed cross-appeals arguing that there were other errors of law in the DMC decision. They say the High Court should have set the DMC decision aside for those reasons also. They seek an order dismissing TTR’s application for consents under the EEZ Act, rather than referring it back to the DMC.
The respondents’ challenges to the decisions of the DMC and the High Court raise a number of interrelated issues. The arguments at the forefront of their cross‑appeal are that:
(a)The DMC and the High Court failed to correctly identify the statutory purpose in relation to marine discharge consents, which is set out in s 10(1)(b): protecting the environment from pollution caused by marine discharges. The DMC and the High Court failed to treat that purpose as the relevant decision-making criterion for TTR’s application for a marine discharge consent in relation to the sediment plume.
(b)The DMC failed to give effect to the information principles in ss 61 and 87E of the EEZ Act, and in particular, the requirement that where the information available is uncertain or inadequate the EPA must favour caution and environmental protection.
(c)The DMC failed to have regard to the principles of the Treaty, and failed to have regard to the effects of the proposal on the existing interests of iwi Māori as required by s 59(2). In particular, the DMC failed to have regard to the effects of the proposal on the kaitiakitanga relationship between tangata whenua and the marine environment and its resources, and on the commercial fishing interests of Māori.
(d)The DMC failed to have regard to the nature and effect of relevant marine management regimes as required by s 59(2), in particular the New Zealand Coastal Policy Statement (NZCPS) issued under the Resource Management Act 1991 (RMA).
(e)The High Court erred in law in rejecting these (and other) arguments, and in declining to make an order dismissing TTR’s application.
This Court granted TTR’s application for leave to appeal and the respondents’ application for leave to cross-appeal in a Minute dated 19 December 2018.
Summary of outcome
We consider that there were multiple overlapping errors of law in the approach adopted by the DMC. The High Court erred in law in failing to identify these defects in the DMC decision. In particular:
(a)The DMC failed to address the central question of whether granting a marine discharge consent would be consistent with the objective set out in s 10(1)(b) of the EEZ Act in relation to discharges of harmful substances: protecting the environment from pollution. The DMC erred in focusing on the sustainable management objective that applies to all marine consents under the EEZ Act, and failing to give separate and explicit consideration to the environmental bottom line of protecting the environment from pollution caused by discharges of harmful substances.
(b)The information before the DMC about the environmental effects of the proposal was not sufficient to enable the DMC to grant consents on the broad terms it approved, consistent with the statutory requirement that where the information available is uncertain or inadequate the EPA must favour caution and environmental protection. The DMC attempted to fill critical gaps in the information available about likely environmental effects by requiring the necessary information to be gathered after the consents were granted, before mining commenced and while it was under way. That approach was inconsistent with the EEZ Act.
(c)The DMC was required to have regard to the effect of the activity on existing interests. As we explain below, the kaitiakitanga relationship between tangata whenua and the marine environment and its resources is a relevant “existing interest”. That kaitiakitanga relationship includes, but is not limited to, the stewardship and use of natural resources such as kai moana. The cultural and spiritual elements of kaitiakitanga must also be considered. The DMC erred in failing to address the effects of TTR’s proposals on kaitiakitanga in that broader sense, and in failing to adopt an approach to those effects that was consistent with the Treaty principles that the relevant provisions of the EEZ Act are intended to ensure the Crown recognises and respects.
(d)The DMC was required to have regard to the nature and effect of the RMA and the NZCPS, which are identified as relevant marine management regimes for the purposes of the EEZ Act. Many of the effects of the proposed mining activity will occur within the coastal marine area (CMA) to which the RMA and NZCPS apply. The DMC needed to consider the objectives of the RMA and NZCPS, and the outcomes sought to be achieved by those instruments, in the area affected by the TTR proposal. It needed to consider whether TTR’s proposal would produce effects within the CMA that would be inconsistent with the outcomes sought to be achieved by those regimes. In particular, the DMC needed to consider whether TTR’s proposal would be inconsistent with any environmental bottom lines established by the NZCPS. The DMC failed to address these important questions.
For these and other reasons, we uphold the decision of the High Court to allow the appeal from the DMC and quash the DMC decision.
We do not consider that the DMC decision adopted an adaptive management approach. The features of the consent that were seen by the High Court as constituting an adaptive management approach are better understood as a reflection of the more fundamental problem that the inadequate information before the DMC about the effects of the proposal meant that consents could not lawfully be granted on such broad terms. The High Court’s reason for allowing the appeal from the DMC and quashing the DMC decision was not in our view correct. But the result arrived at reflected a well-founded concern about the scope and terms of the consents, and the mechanisms approved by the DMC for gathering information about the effects of the consented activities after the consents had been granted, in circumstances where that information was necessary to enable the DMC to understand and assess the impact of the proposed activities on the environment before consents could be granted.
We have considered whether in these circumstances TTR’s application for a marine consent and a marine discharge consent should be dismissed. But we cannot rule out the possibility that consents for more limited activities, or on different terms, might properly be granted by the DMC. We therefore refer TTR’s application back to the DMC to be considered in light of this judgment.
The structure of this judgment
The appeal and cross-appeals before this Court raise a wide range of issues about the operation of the EEZ Act, and the approach adopted by the DMC. Many of those issues are interrelated. The relevant provisions of the EEZ Act need to be read and understood in the context of the wider statutory scheme and the purpose of the legislation. We therefore begin by reviewing the scheme of the EEZ Act and identifying some important features of the statutory framework for decision-making by the EPA in relation to applications for marine consents and marine discharge consents.
In light of that discussion, we turn to consider the issues raised by the appeal and the cross-appeals. In relation to each issue we consider the approach adopted by the DMC and the terms of the consents granted, the High Court decision, and the various criticisms of that decision advanced by the parties to this appeal. We conclude by addressing the question of relief raised by the cross-appeals.
The EEZ Act
International law context for New Zealand’s EEZ Act
A coastal State may claim an EEZ extending beyond its territorial waters to a distance of up to 200 nautical miles (NM) from the coastline.[7] The EEZ is a recent innovation in the international law of the sea. In 1977 New Zealand claimed a 200 NM EEZ.[8] The claim was made in accordance with emerging principles of customary
international law, which were subsequently recognised and given clear expression in the LOSC.[9] The text of the LOSC was finalised in December 1982. The Convention came into force in 1994.[10] New Zealand became a party to the LOSC in 1996. The LOSC is now widely ratified, with 168 parties as at the date of this judgment.[7]Donald R Rothwell and Tim Stephens The International Law of the Sea (2nd ed, Hart Publishing, Oxford, 2016) at 85.
[8]In 1977 New Zealand enacted the Territorial Sea and Exclusive Economic Zone Act 1977, which in 1996 was renamed the Territorial Sea, Contiguous Zone, and Exclusive Economic Zone Act 1977.
[9]Rothwell and Stephens, above n 7, at 85–86.
[10]One year after deposit of the sixtieth instrument of ratification or acceptance: United Nations Convention on the Law of the Seas, art 308; and see Rothwell and Stephens, above n 7, at 18–19.
The LOSC sets out the rights and duties of a coastal State that claims an EEZ. In its EEZ New Zealand has:[11]
(a)sovereign rights for the purpose of exploring and exploiting, conserving and managing the natural resources, whether living or non-living, of the waters superjacent to the seabed and of the seabed and its subsoil, and with regard to other activities for the economic exploitation and exploration of the zone, such as the production of energy from the water, currents and winds;
(b)jurisdiction in relation to the protection and preservation of the marine environment, among other matters; and
(c)certain other rights and duties set out in the LOSC.
[11]United Nations Convention on the Law of the Seas, art 56.
New Zealand’s duties in relation to its EEZ include the duties in relation to protection and preservation of the marine environment set out in pt XII of the LOSC. Article 192 provides that States have an “obligation to protect and preserve the marine environment”. Article 193 provides that States “have the sovereign right to exploit their natural resources pursuant to their environmental policies and in accordance with their duty to protect and preserve the marine environment” (emphasis added).
Article 194 provides:
Article 194
Measures to prevent, reduce and control pollution
of the marine environment1. States shall take, individually or jointly as appropriate, all measures consistent with this Convention that are necessary to prevent, reduce and control pollution of the marine environment from any source, using for this purpose the best practicable means at their disposal and in accordance with their capabilities, and they shall endeavour to harmonize their policies in this connection.
…
3. The measures taken pursuant to this Part shall deal with all sources of pollution of the marine environment. These measures shall include, inter alia, those designed to minimize to the fullest possible extent:
(a)the release of toxic, harmful or noxious substances, especially those which are persistent, from land-based sources, from or through the atmosphere or by dumping;
(b) pollution from vessels, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea, preventing intentional and unintentional discharges, and regulating the design, construction, equipment, operation and manning of vessels;
(c) pollution from installations and devices used in exploration or exploitation of the natural resources of the sea-bed and subsoil, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea, and regulating the design, construction, equipment, operation and manning of such installations or devices;
(d)pollution from other installations and devices operating in the marine environment, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea, and regulating the design, construction, equipment, operation and manning of such installations or devices.
…
5. The measures taken in accordance with this Part shall include those necessary to protect and preserve rare or fragile ecosystems as well as the habitat of depleted, threatened or endangered species and other forms of marine life.
Article 208 goes on to provide that coastal States must “adopt laws and regulations to prevent, reduce and control pollution of the marine environment arising from or in connection with sea-bed activities subject to their jurisdiction”.
The RMA applies to activities carried out in New Zealand, including activities carried out in New Zealand’s territorial sea — that is, out to the 12 NM limit where the territorial sea ends and the EEZ begins. The RMA does not apply directly to activities in the EEZ.[12] Activities carried out in the EEZ are regulated by the EEZ Act, which implements New Zealand’s obligations under art 208 of the LOSC and certain other LOSC provisions that apply to the EEZ.[13]
[12]The relevance of the RMA to decision-making under the EEZ Act is addressed in more detail below.
[13]Regulations to give effect to those obligations are also contemplated by s 27 of the Territorial Sea, Contiguous Zone, and Exclusive Economic Zone Act. The regulation-making powers under s 27 are available where no other provision is made by any other enactment for the relevant purposes. However, those powers had not been exercised to regulate activities affecting the marine environment in the EEZ prior to the enactment of the EEZ Act: see Greenpeace of New Zealand Inc v Minister of Energy and Resources [2012] NZHC 1422.
A number of other international instruments have implications for New Zealand’s regulation of activities in the EEZ, including:
(a)The Convention on Biological Diversity of 1992 (the Biodiversity Convention).[14] The objectives of the Biodiversity Convention include the conservation of biological diversity and the sustainable use of its components.[15] These objectives are relevant to a wide range of activities in the EEZ, including marine discharges.
(b)The International Convention for the Prevention of Pollution from Ships (MARPOL).[16] MARPOL contains a number of provisions relating to marine discharges, primarily from ships.
(c)The Convention on the Prevention of Marine Pollution by Dumping Wastes and Other Matter (London Convention), and the 1996 Protocol to the London Convention (1996 Protocol).[17] The London Convention governs the deliberate disposal of waste or other matter at sea, but does not extend to discharges from the normal operation of ships. It also does not apply to the disposal of waste as a result of seabed mining activities.
[14]Convention on Biological Diversity 1760 UNTS 79 (opened for signature 5 June 1992, entered into force 29 December 1993).
[15]Article 1.
[16]International Convention for the Prevention of Pollution from Ships 1340 UNTS 184 (signed 17 February 1973, entered into force 2 October 1983) [MARPOL].
[17]Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter 1046 UNTS 120 (opened for signature 29 December 1972, entered into force 30 August 1975) [London Convention]; and Protocol to the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter (adopted 17 November, entered into force 24 March 2006) [1996 Protocol].
MARPOL sets international standards for control of vessel-source pollution. Its objective is to achieve the complete elimination of intentional pollution of the marine environment by oil and other harmful substances, and the minimisation of accidental discharge of such substances.[18] MARPOL applies to the discharge of all harmful substances except those from dumping (within the meaning of the London Convention), seabed exploration, exploitation, and legitimate scientific research into pollution abatement.[19]
[18]MARPOL, preamble.
[19]Article 2(3)(b).
The London Convention regulates the dumping of waste and other substances at sea. The 1996 Protocol adopts a more stringent approach than the original 1972 Convention. Under the 1996 Protocol, the dumping of any substance is generally prohibited unless it can be demonstrated that the substance is not harmful to the marine environment. The Protocol requires parties, including New Zealand, to apply “a precautionary approach to environmental protection from dumping … whereby appropriate preventative measures are taken when there is reason to believe that wastes … are likely to cause harm even when there is no conclusive evidence to prove a causal relation between inputs and their effects”.[20]
[20]1996 Protocol, art 3(1).
The EEZ Act as originally enacted in 2012 did not apply to marine discharges and dumping. Those matters continued to be governed by the Maritime Transport Act 1994. In 2013 the EEZ Act was amended to bring marine discharges and dumping under that Act, and shift regulatory responsibility for those matters from Maritime New Zealand to the EPA. Those amendments came into force on 31 October 2015. Thus the EEZ Act now also gives effect to New Zealand’s international obligations under MARPOL and the London Convention in respect of activities in the EEZ.
MARPOL is not directly relevant to the consents sought by TTR, as the discharges in respect of which TTR seeks consent are discharges resulting from seabed exploitation. But the interpretation of the provisions of the EEZ Act concerned with marine discharges and dumping must take into account the Act’s objective of giving effect to New Zealand’s obligations under MARPOL.
Similarly, the London Convention (including the 1996 Protocol) is not directly relevant to the consents sought by TTR which do not relate to marine dumping. But the interpretation of the provisions of the EEZ Act concerned with marine discharges and dumping must take into account the Act’s objective of giving effect to New Zealand’s obligations under the London Convention, including the 1996 Protocol. That objective will be achieved only if those provisions effectively prohibit marine pollution by dumping and adopt a precautionary approach in relation to dumping.
The EEZ Act
The EEZ Act was extensively amended by the Resource Legislation Amendment Act 2017 with effect from 1 June 2017. TTR’s application was made on 23 August 2016. The application falls to be determined under the EEZ Act as it stood in August 2016, without reference to the 2017 amendments.[21] All references in this judgment to the EEZ Act are references to the Act as at August 2016, unless otherwise noted.
[21]EEZ Act, s 7B and sch 1 as inserted by the Resource Legislation Amendment Act 2017.
The purpose of the EEZ Act is set out in s 10, which provides:
10 Purpose
(1) The purpose of this Act is—
(a) to promote the sustainable management of the natural resources of the exclusive economic zone and the continental shelf; and
(b) in relation to the exclusive economic zone, the continental shelf, and the waters above the continental shelf beyond the outer limits of the exclusive economic zone, to protect the environment from pollution by regulating or prohibiting the discharge of harmful substances and the dumping or incineration of waste or other matter.
(2) In this Act, sustainable management means managing the use, development, and protection of natural resources in a way, or at a rate, that enables people to provide for their economic well-being while—
(a) sustaining the potential of natural resources (excluding minerals) to meet the reasonably foreseeable needs of future generations; and
(b) safeguarding the life-supporting capacity of the environment; and
(c) avoiding, remedying, or mitigating any adverse effects of activities on the environment.
(3) In order to achieve the purpose, decision-makers must—
(a) take into account decision-making criteria specified in relation to particular decisions; and
(b) apply the information principles to the development of regulations and the consideration of applications for marine consent.
Paragraph (b) of s 10(1) was inserted in 2013, when marine discharges and dumping were brought within the scope of the EEZ Act. Paragraph (a) is relevant to all applications under the EEZ Act for marine consents and marine discharge and dumping consents. Paragraph (b) is of particular relevance to applications for marine discharge consents and marine dumping consents. Where a marine discharge consent is sought, both limbs of s 10(1) are relevant, and as we explain below, each must be separately addressed by the EPA.
The use of the term “sustainable management” in s 10 was intended to align the purposes of the EEZ Act with the purpose of the RMA. As the then Minister for the Environment explained at the committee of the whole house stage:[22]
We have decided that it makes better sense to have a purpose clause incorporating the principle of sustainable management. … The changes are reflecting the fact that we do see considerable benefit for all stakeholders in having a regime of sustainable management that is well defined in case law, that parties do understand, and that, importantly, provides a consistency of
approach between matters within the 12-mile limit and those outside that limit, between the 12 and 200-mile limit. We can certainly see benefit in applications that will have impact on both sides of that 12-mile limit by having some consistency of approach.[22](16 August 2012) 682 NZPD 4492.
There are some differences in the wording of the definition of “sustainable management” in s 10(2) of the EEZ Act and in s 5(2) of the RMA, reflecting differences in the contexts in which the two statutes operate. But the central concept is the same.
Section 10(3) makes it clear that in order to achieve the purpose of the EEZ Act, decision-makers must take into account any specified decision-making criteria, and must apply the information principles set out in ss 61 and 87E, which we discuss below. However, that does not exhaust the relevance of the statutory purpose statement. Rather, s 10(1) sets out the principal criteria by reference to which powers must be exercised under the EEZ Act. Indeed when it comes to the grant of marine consents and marine discharge consents under pt 3, s 10 provides the only decision‑making criteria in the EEZ Act and must be the touchstone of the EPA’s analysis. We return to this below.
The term “environment” which appears in s 10 and elsewhere in the EEZ Act is defined in s 4:
environment means the natural environment, including ecosystems and their constituent parts and all natural resources, of—
(a)New Zealand:
(b)the exclusive economic zone:
(c)the continental shelf:
(d)the waters beyond the exclusive economic zone and above and beyond the continental shelf.
The term “natural resources” as it relates to the EEZ is defined to include “seabed, subsoil, water, air, minerals, and energy, and all forms of organisms (whether native to New Zealand or introduced)”.[23]
[23]EEZ Act, s 4.
Section 11 records that the EEZ Act continues or enables the implementation of New Zealand’s obligations under various international conventions relating to the marine environment. It provides:
11 International obligations
This Act continues or enables the implementation of New Zealand’s obligations under various international conventions relating to the marine environment, including—
(a)the United Nations Convention on the Law of the Sea 1982:
(b) the Convention on Biological Diversity 1992:
(c) the International Convention for the Prevention of Pollution from Ships, 1973 (MARPOL):
(d)the Convention on the Prevention of Marine Pollution by Dumping Wastes and Other Matter, 1972 (the London Convention).
Section 11 sends a clear signal to decision-makers that the legislation is intended to implement New Zealand’s obligations under the instruments to which it refers, and thus that those instruments are relevant to the interpretation of the provisions of the legislation.[24]
[24]Helu v Immigration and Protection Tribunal [2015] NZSC 28, [2016] 1 NZLR 298 at [143] per McGrath J.
As the courts have recognised since the seminal decision in Huakina Development Trust v Waikato Valley Authority, environmental regulation is a sphere in which the Crown’s obligations under the Treaty are of particular importance.[25] Section 12 of the EEZ Act provides:
12 Treaty of Waitangi
In order to recognise and respect the Crown’s responsibility to give effect to the principles of the Treaty of Waitangi for the purposes of this Act,—
(a) section 18 (which relates to the function of the Māori Advisory Committee) provides for the Māori Advisory Committee to advise the Environmental Protection Authority so that decisions made under this Act may be informed by a Māori perspective; and
(b) section 32 requires the Minister to establish and use a process that gives iwi adequate time and opportunity to comment on the subject matter of proposed regulations; and
(c) sections 33 and 59, respectively, require the Minister and the EPA to take into account the effects of activities on existing interests; and
(d) section 45 requires the Environmental Protection Authority to notify iwi authorities, customary marine title groups, and protected customary rights groups directly of consent applications that may affect them.
[25]HuakinaDevelopment Trust v Waikato Valley Authority [1987] 2 NZLR 188 (HC).
The relevance of the Treaty to EPA decision-making in relation to consent applications is discussed in more detail at [133]–[180] below.
Part 2 of the EEZ Act is headed “Duties, restrictions, and prohibitions”. Subpart 1 is concerned with activities other than discharges and dumping. Section 20 provides:
20 Restriction on activities other than discharges and dumping
(1) No person may undertake an activity described in subsection (2) in the exclusive economic zone or in or on the continental shelf unless the activity is a permitted activity or authorised by a marine consent or section 21, 22, or 23.
(2) The activities referred to in subsection (1) are—
(a) the construction, placement, alteration, extension, removal, or demolition of a structure on or under the seabed:
(b) the construction, placement, alteration, extension, removal, or demolition of a submarine pipeline on or under the seabed:
(c) the placement, alteration, extension, or removal of a submarine cable on or from the seabed:
(d) the removal of non-living natural material from the seabed or subsoil:
(e) the disturbance of the seabed or subsoil in a manner that is likely to have an adverse effect on the seabed or subsoil:
(f) the deposit of any thing or organism in, on, or under the seabed:
(g) the destruction, damage, or disturbance of the seabed or subsoil in a manner that is likely to have an adverse effect on marine species or their habitat.
(3) No person may undertake an activity described in subsection (4) in the sea of the exclusive economic zone unless the activity is a permitted activity or authorised by a marine consent or section 21, 22, or 23.
(4) The activities referred to in subsection (3) are—
(a) the construction, mooring or anchoring long-term, placement, alteration, extension, removal, or demolition of a structure, part of a structure, or a ship used in connection with a structure:
(b) the causing of vibrations (other than vibrations caused by the propulsion of a ship) in a manner that is likely to have an adverse effect on marine life:
(c) the causing of an explosion.
(5) However, this section does not apply to—
(a) the discharge of harmful substances; or
(b) the dumping of waste or other matter; or
(c) lawful fishing for wild fish under the Fisheries Act 1996.
Subpart 2 of pt 2 is headed “Restrictions and prohibitions on discharges and dumping”. Section 20A describes how the discharge of harmful substances is regulated under the EEZ Act and the Maritime Transport Act. As the provision explains, sub-pt 2 of pt 2 of the EEZ Act regulates discharges into the EEZ and into or onto the seabed below it from certain sources, including mining discharges from ships. Other discharges from ships into the EEZ continue to be regulated under the Maritime Transport Act.
Section 20C is concerned with mining discharges from ships. It provides:
20C Restriction on mining discharges from ships
(1) No person may discharge a harmful substance (if the discharge is a mining discharge) from a ship—
(a) into the sea of the exclusive economic zone or above the continental shelf beyond the outer limits of the exclusive economic zone; or
(b) into or onto the continental shelf.
(2) However, a person may discharge the harmful substance in the circumstance described in subsection (1) if the discharge is a permitted activity or authorised by a marine consent or section 21, 22, or 23.
Subpart 3, which is concerned with existing activities and planned petroleum activities, is not directly relevant in this case. Subpart 4 imposes certain general obligations on persons operating in the EEZ,[26] and confirms that compliance with the EEZ Act does not remove the need to comply with all other applicable Acts, regulations and rules of law, and vice versa.[27]
[26]EEZ Act, s 25.
[27]Section 26.
Part 3 is concerned with requirements for carrying out certain activities, and the consenting process in respect of discretionary activities. Subpart 1 provides for the making of regulations in relation to a range of matters. Section 29A provides for regulations to be made in relation to discharges and dumping in the EEZ and continental shelf area. Among other matters, regulations under section 29A may prescribe a substance to be a harmful substance,[28] and in relation to a harmful substance may prohibit its discharge, or allow the discharge without a marine consent, or allow the discharge with a marine consent.[29]
[28]Section 29A(4).
[29]Section 29A(2)(b).
Section 34 sets out the “information principles” that the Minister responsible for administering the EEZ Act must apply when developing regulations under sub‑pt 1. It provides:
34 Information principles
(1) When developing regulations under sections 27, 29A, and 29B, the Minister must—
(a) make full use of the information and other resources available to him or her; and
(b) base decisions on the best available information; and
(c) take into account any uncertainty or inadequacy in the information available.
(2) If, in relation to the making of a decision under this Act, the information available is uncertain or inadequate, the Minister must favour caution and environmental protection.
(3) If favouring caution and environmental protection means that an activity is likely to be prohibited, the Minister must first consider whether providing for an adaptive management approach would allow the activity to be classified as discretionary.
(4) In this section, best available information means the best information that, in the particular circumstances, is available without unreasonable cost, effort, or time.
Sections 35 to 37 define the concepts of permitted activities, discretionary activities and prohibited activities. The seabed mining activities that TTR proposes to carry out include a number of discretionary activities. Section 36(2) provides that a person must have a marine consent before undertaking a discretionary activity.
Subpart 2 of pt 3 governs applications for marine consents. It applies in relation to discretionary activities in the EEZ other than discharges and dumping (those activities are governed by sub-pt 2A, discussed below). Section 38 provides that any person may apply to the EPA for a marine consent to undertake a discretionary activity. An application must fully describe the proposal and must include an impact assessment prepared in accordance with s 39.[30] Section 39 sets out the requirements for an impact assessment to accompany an application for a marine consent. It provides (so far as relevant):
[30]Section 38(2)(b) and (c).
39 Impact assessment
(1) An impact assessment must—
(a) describe the activity for which consent is sought; and
(b) describe the current state of the area where it is proposed that the activity will be undertaken and the environment surrounding the area; and
(c) identify the effects of the activity on the environment and existing interests (including cumulative effects and effects that may occur in New Zealand or in the sea above or beyond the continental shelf beyond the outer limits of the exclusive economic zone; and
(d) identify persons whose existing interests are likely to be adversely affected by the activity; and
(e) describe any consultation undertaken with persons described in paragraph (d) and specify those who have given written approval to the activity; and
(f) include copies of any written approvals to the activity; and
(g) specify any possible alternative locations for, or methods for undertaking, the activity that may avoid, remedy, or mitigate any adverse effects; and
(h) specify the measures that the applicant intends to take to avoid, remedy, or mitigate the adverse effects identified.
(2) An impact assessment must contain the information required by subsection (1) in—
(a) such detail as corresponds to the scale and significance of the effects that the activity may have on the environment and existing interests; and
(b) sufficient detail to enable the Environmental Protection Authority and persons whose existing interests are or may be affected to understand the nature of the activity and its effects on the environment and existing interests.
(3) The impact assessment complies with subsection (1)(c) and (d) if the Environmental Protection Authority is satisfied that the applicant has made a reasonable effort to identify the matters described in those paragraphs.
…
The EPA is required to deal with an application for a marine consent as promptly as is reasonable in the circumstances.[31] The EPA may return an application that it considers is incomplete because it does not include an impact assessment that complies with s 39, or any other information required by the EEZ Act.[32]
[31]Section 40.
[32]Section 41.
Section 42 provides that the EPA may request an applicant to provide further information relating to an application. A request under s 42 can be made at any reasonable time before a hearing on an application for a consent (or, if no hearing is to be held, before a decision is made). Section 44 confers broad powers on the EPA to commission reviews and reports, and seek advice and information, in relation to an application for a marine consent. Section 44(1)(c) provides that the EPA may seek advice on any matter related to an application from the Māori Advisory Committee established under s 18 of the Environmental Protection Authority Act 2011.
Subpart 2 goes on to set out the process for public notification of applications, and for the hearing and determination of applications.[33]
[33]Sections 45–71.
A number of the provisions that are at the heart of this appeal are set out under the sub-heading “Decisions”. Section 59 identifies a number of mandatory relevant considerations in relation to the determination of an application for a marine consent. The relevant limbs of s 59 provide as follows:
59Environmental Protection Authority’s consideration of application
(1) This section and sections 60 and 61 apply when the Environmental Protection Authority is considering an application for a marine consent and submissions on the application.
(2) The EPA must take into account—
(a) any effects on the environment or existing interests of allowing the activity, including—
(i) cumulative effects; and
(ii) effects that may occur in New Zealand or in the waters above or beyond the continental shelf beyond the outer limits of the exclusive economic zone; and
(b) the effects on the environment or existing interests of other activities undertaken in the area covered by the application or in its vicinity, including—
(i)the effects of activities that are not regulated under this Act; and
(ii) effects that may occur in New Zealand or in the waters above or beyond the continental shelf beyond the outer limits of the exclusive economic zone; and
(c) the effects on human health that may arise from effects on the environment; and
(d) the importance of protecting the biological diversity and integrity of marine species, ecosystems, and processes; and
(e) the importance of protecting rare and vulnerable ecosystems and the habitats of threatened species; and
(f) the economic benefit to New Zealand of allowing the application; and
(g) the efficient use and development of natural resources; and
(h) the nature and effect of other marine management regimes; and
(i) best practice in relation to an industry or activity; and
(j) the extent to which imposing conditions under section 63 might avoid, remedy, or mitigate the adverse effects of the activity; and
(k) relevant regulations; and
(l) any other applicable law; and
(m) any other matter the EPA considers relevant and reasonably necessary to determine the application.
(3) The EPA must have regard to—
(a) any submissions made and evidence given in relation to the application; and
(b) any advice, reports, or information it has sought and received in relation to the application; and
(c) any advice received from the Māori Advisory Committee.
…
Although s 59 identifies the key factors that are relevant to consideration of an application for a marine consent, it does not set out any decision-making criteria for the EPA to apply when determining that application. We return to this point below.
The term “existing interest” used in s 59(2) is defined in s 4 as follows:
existing interest means, in relation to New Zealand, the exclusive economic zone, or the continental shelf (as applicable), the interest a person has in—
(a)any lawfully established existing activity, whether or not authorised by or under any Act or regulations, including rights of access, navigation, and fishing:
(b)any activity that may be undertaken under the authority of an existing marine consent granted under section 62:
(c)any activity that may be undertaken under the authority of an existing resource consent granted under the Resource Management Act 1991:
(d)the settlement of a historical claim under the Treaty of Waitangi Act 1975:
(e)the settlement of a contemporary claim under the Treaty of Waitangi as provided for in an Act, including the Treaty of Waitangi (Fisheries Claims) Settlement Act 1992:
(f)a protected customary right or customary marine title recognised under the Marine and Coastal Area (Takutai Moana) Act 2011
Section 60 sets out certain matters that the EPA must consider when determining the extent of adverse effects on existing interests, as required by s 59(2)(a). Section 60 provides:
60 Matters to be considered in deciding extent of adverse effects on existing interests
In considering the effects of an activity on existing interests under section 59(2)(a), the Environmental Protection Authority must have regard to—
(a) the area that the activity would have in common with the existing interest; and
(b) the degree to which both the activity and the existing interest must be carried out to the exclusion of other activities; and
(c) whether the existing interest can be exercised only in the area to which the application relates; and
(d) any other relevant matter.
Section 61 sets out the information principles relevant to marine consents:
61 Information principles
(1) When considering an application for a marine consent, the Environmental Protection Authority must—
(a) make full use of its powers to request information from the applicant, obtain advice, and commission a review or a report; and
(b) base decisions on the best available information; and
(c) take into account any uncertainty or inadequacy in the information available.
(2) If, in relation to making a decision under this Act, the information available is uncertain or inadequate, the EPA must favour caution and environmental protection.
(3) If favouring caution and environmental protection means that an activity is likely to be refused, the EPA must first consider whether taking an adaptive management approach would allow the activity to be undertaken.
(4) Subsection (3) does not limit section 63 or 64.
(5) In this section, best available information means the best information that, in the particular circumstances, is available without unreasonable cost, effort, or time.
Section 62 provides that after complying with ss 59 to 61, the EPA may grant an application for a marine consent in whole or in part, or refuse the application. It confirms, to avoid doubt, that the EPA may refuse an application for a consent if it considers that it does not have adequate information to determine the application. That is a necessary consequence of the direction in s 61(2) to favour caution and environmental protection where the information available is uncertain or inadequate.
A consent may be granted subject to conditions imposed under s 63, which provides:
63 Conditions of marine consents
(1) The Environmental Protection Authority may grant a marine consent on any condition that it considers appropriate to deal with adverse effects of the activity authorised by the consent on the environment or existing interests.
(2) The conditions that the EPA may impose include, but are not limited to, conditions—
(a) requiring the consent holder to—
(i) provide a bond for the performance of any 1 or more conditions of the consent:
(ii) obtain and maintain public liability insurance of a specified value:
(iii) monitor, and report on, the exercise of the consent and the effects of the activity it authorises:
(iv) appoint an observer to monitor the activity authorised by the consent and its effects on the environment:
(v)make records related to the activity authorised by the consent available for audit:
(b) that together amount or contribute to an adaptive management approach.
(3) However, the EPA must not impose a condition on a consent if the condition would be inconsistent with this Act or any regulations.
(4) To avoid doubt, the EPA may not impose a condition to deal with an effect if the condition would conflict with a measure required in relation to the activity by another marine management regime or the Health and Safety at Work Act 2015.
Section 64 confirms that an adaptive management approach may be incorporated in a marine consent. It provides:
64 Adaptive management approach
(1) The Environmental Protection Authority may incorporate an adaptive management approach into a marine consent granted for an activity.
(2) An adaptive management approach includes—
(a) allowing an activity to commence on a small scale or for a short period so that its effects on the environment and existing interests can be monitored:
(b) any other approach that allows an activity to be undertaken so that its effects can be assessed and the activity discontinued, or continued with or without amendment, on the basis of those effects.
(3) In order to incorporate an adaptive management approach into a marine consent, the EPA may impose conditions under section 63 that authorise the activity to be undertaken in stages, with a requirement for regular monitoring and reporting before the next stage of the activity may be undertaken or the activity continued for the next period.
(4) A stage may relate to the duration of the consent, the area over which the consent is granted, the scale or intensity of the activity, or the nature of the activity.
Section 65 makes detailed provision for bonds, where a bond is required by conditions imposed by the EPA under s 63.
Section 66 makes detailed provision in relation to monitoring conditions incorporated in a marine consent.
Section 76 provides for the EPA to review the duration and conditions of a consent in certain circumstances. Section 76(1) provides as follows:
(1) The Environmental Protection Authority may serve notice on a consent holder of its intention to review the duration of a marine consent or the conditions of the consent—
(a) at any time or times specified for that purpose in the consent for any of the following purposes:
(i) to deal with any adverse effect on the environment that may arise from the exercise of the consent and with which it is appropriate to deal after the consent has been granted:
(ii) any other purpose specified in the consent:
(b) if regulations take effect that prescribe standards, to ensure that the conditions are consistent with the standards, methods, or requirements:
(c) to deal with any adverse effects on the environment or existing interests that arise and that—
(i) were not anticipated when the consent was granted; or
(ii) are of a scale or intensity that was not anticipated when the consent was granted:
(d) if the information made available to the EPA by the applicant for the consent for the purposes of the application contained inaccuracies that materially influenced the decision made on the application and the effects of the exercise of the consent are such that it is necessary to apply more appropriate conditions:
(e) if information becomes available to the EPA that was not available to the EPA when the consent was granted and the information shows that more appropriate conditions are necessary to deal with the effects of the exercise of the consent.
…
Subpart 2A of pt 3 is concerned with marine discharge consents and marine dumping consents: consents relating to the activities described in sub-pt 2 of pt 2. Subpart 2A was inserted in the EEZ Act by the 2013 amendment legislation.[34]
[34]Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Act 2013.
Section 87B provides that any person may apply to the EPA for a marine discharge consent or a marine dumping consent to undertake a discretionary activity. The application must fully describe the proposal and include an impact assessment prepared in accordance with s 39. Most of the procedural provisions in sub‑pt 2 also apply to applications under sub‑pt 2A.[35] However s 87D modifies the application of s 59 in the context of marine discharge and dumping consents. It provides:
[35]EEZ Act, s 87C.
87D Environmental Protection Authority’s consideration of application
(1) This section and sections 87E and 87F apply when the Environmental Protection Authority is considering an application for a marine discharge consent or a marine dumping consent and submissions on the application.
(2) The EPA must take into account,—
(a) in relation to the discharge of harmful substances,—
(i) the matters described in section 59(2), except paragraph (c); and
(ii) the effects on human health of the discharge of harmful substances if consent is granted; and
(b) in relation to the dumping of waste or other matter,—
(i) the matters described in section 59(2), except paragraphs (c), (f), (g), and (i); and
(ii) the effects on human health of the dumping of waste or other matter if consent is granted; and
(iii) any alternative methods of disposal that could be used; and
(iv) whether there are practical opportunities to reuse, recycle, or treat the waste.
(3) Section 59(3) applies to the application for a marine discharge consent or a marine dumping consent.
Section 87E sets out the information principles relevant to discharges and dumping. It corresponds to s 61 in relation to marine consents, but — importantly for this appeal — without the provision found in s 61(3) contemplating the use of an adaptive management approach. It provides:
87E Information principles relating to discharges and dumping
(1) When considering an application for a marine dumping consent or a marine discharge consent, the Environmental Protection Authority must—
(a) make full use of its powers to request information from the applicant, obtain advice, and commission a review or a report; and
(b) base decisions on the best available information; and
(c) take into account any uncertainty or inadequacy in the information available.
(2) If, in relation to making a decision on the application, the information available is uncertain or inadequate, the EPA must favour caution and environmental protection.
(3) In this section, best available information means the best information that, in the particular circumstances, is available without unreasonable cost, effort, or time.
Section 87F expressly precludes the possibility of granting marine discharge consents or marine dumping consents on the basis of conditions amounting to an adaptive management approach. It provides:
87F Decision on application for marine discharge consent or marine dumping consent
(1) After complying with sections 87D and 87E, the Environmental Protection Authority may—
(a) grant an application for a marine discharge consent or a marine dumping consent, in whole or in part, and issue a consent; or
(b) refuse the application.
(2) However, the EPA must refuse an application for a marine dumping consent if—
(a) the EPA considers that the waste or other matter may be reused, recycled, or treated without—
(i) adverse effects on human health or the environment that are more than minor; or
(ii) imposing costs on the applicant that are unreasonable in the circumstances; or
(b) the waste or other matter is identified in such a way that it is not possible to assess the potential effects of dumping the waste or other matter on human health or the environment; or
(c) the EPA considers that dumping the waste or other matter is not the best approach to the disposal of the waste or other matter in the circumstances.
(3) To avoid doubt, the EPA may refuse an application for a marine discharge consent or a marine dumping consent if the EPA considers that it does not have adequate information to determine the application.
(4) If the EPA grants the application, it may issue the consent subject to conditions under section 63, but not under section 63(2)(b).
The conditions referred to in s 63(2)(b), which by virtue of s 87F(4) may not be included in a marine discharge consent or marine dumping consent, are conditions which “together amount or contribute to an adaptive management approach”. Adaptive management is not permitted in the marine dumping or discharge context.
Section 87G provides for the application to marine dumping consents and marine discharge consents of ss 65 to 67, which relate to conditions (including conditions relating to bonds), and ss 68 to 72, which address a number of ancillary matters in relation to consents.
Subpart 3 of pt 3 is concerned with marine consents for cross-boundary activities, which are defined as activities that are carried out partly in the EEZ or in or on the Continental Shelf, and partly in New Zealand.[36] The seabed mining activities that TTR proposes to carry out are not cross boundary activities as defined, as they would be carried out solely within the EEZ. But as noted above, the effects of those activities will occur to a significant extent within the CMA. We return to this topic at paragraph [111] below.
[36]Section 88.
Before leaving this review of relevant provisions of the EEZ Act, we note that s 105 provides for appeals on a question of law from a decision of the EPA. Section 113 provides for appeals from the High Court to this Court as if the decision had been made under s 300 of the Criminal Procedure Act 2011.
In light of this review of the relevant provisions of the EEZ Act, we turn to some key elements of the approach that the EPA was required to adopt when making decisions in respect of TTR’s application for a marine discharge consent.
How should the EPA have approached the decision on TTR’s marine discharge consent application?
Before turning to the specific challenges to the High Court decision advanced by the parties, it is helpful to outline — painting with broad brush strokes — the way in which the EEZ Act required the EPA to approach TTR’s application for a marine discharge consent in relation to the sediment from its mining activities. We focus on the marine discharge consent because that was the focus of the submissions on appeal.
TTR’s application was required to fully describe the proposal and include an impact assessment prepared in accordance with s 39.[37] The EPA was required to base its decisions on the best available information.[38] The phrase “best available information” is defined to mean the best information that, in the particular circumstances, is available without unreasonable cost, effort or time.[39]
[37]Section 87B.
[38]Section 87E(1)(b).
[39]Section 87E(3).
In order to obtain the best available information, the EPA was required to make full use of its powers to request information from the applicant, obtain advice, and commission reviews and reports.[40] The requirement to obtain “best available information” did not require the EPA to obtain complete information relevant to TTR’s application. The EEZ Act is framed on the assumption that information about the marine environment may be limited, and decision-making may therefore take place against the backdrop of incomplete information. The implications of incomplete information are identified below. For present purposes, however, the key point is that the EPA will necessarily exercise judgement in deciding what additional information to obtain from the applicant and others, and what reviews and reports to commission. The obligation to make full use of those powers must be understood against the backdrop of the provisions in the EEZ Act expressly recognising the prospect that there will be uncertainty or inadequacy in the available information, and the obligation of the EPA under s 40 to deal with the application as promptly as is reasonable in the circumstances.
[40]Section 87E(1)(a). See also ss 42 and 44.
The EPA was required to give public notice of TTR’s application and serve it on the parties identified in s 45. Those parties include Ministers with relevant responsibilities, and iwi authorities, customary marine title groups and protected customary rights groups that the EPA considered may be affected by the application.[41]
[41]Section 45(1)(a) and (1)(c).
Any person could then make a submission to the EPA within 20 working days of public notification of the application.[42] The EPA was required to advise the applicant of the submissions it had received.[43] Once submissions had been received, the EPA was able to request the applicant and one or more submitters to meet to discuss any matters in dispute in relation to the application for consent, or to enter a mediation to resolve a dispute.[44]
[42]Sections 46–47.
[43]Section 48.
[44]Section 49.
The EPA was required to conduct a hearing if the applicant or any submitter requested a hearing.[45] A hearing was requested in this case. The EEZ Act provides that the date for commencement of a hearing must not be later than 40 working days after the closing date for submissions.[46] The EPA had a broad power to give directions in relation to the conduct of the hearing.[47]
[45]Section 50(b).
[46]Section 51(2).
[47]Section 51(4). See also ss 56–58.
Sections 87D to 87G govern decision-making by the EPA in relation to an application for a marine discharge consent. The EPA was required to take into account the matters described in s 59(2) (except paragraph (c)).[48] Of particular relevance here was the obligation to take into account effects on the environment and effects on existing interests of allowing the activity; the importance of protecting the biological diversity and integrity of marine species, ecosystems, and processes; the importance of protecting rare and vulnerable ecosystems and the habitats of threatened species; the economic benefit to New Zealand of allowing the application; the nature and effect of other marine management regimes; “any other applicable law”; and any other matter the EPA considered relevant and reasonably necessary to determine the application.[49] The EPA was also required to take into account the effects on human health of the discharge of harmful substances if consent was granted.[50]
[48]Section 87D(2)(a)(i).
[49]Section 59(2)(b),(d),(e),(f),(h),(l) and (m).
[50]Section 87D(2)(a)(ii).
The EPA was required to expressly turn its attention to the existence of uncertainty or inadequacy in the information available.[51] If the information available to it was uncertain or inadequate, the EPA was required to favour caution and environmental protection.[52] The EPA could refuse an application for a marine discharge consent if the EPA considered that it did not have adequate information to determine the application.[53]
[51]Section 87E(1)(c).
[52]Section 87E(2).
[53]Section 87F(3).
The EPA could either grant the application in whole or in part and issue a consent, or refuse the application.[54] If the EPA granted the application, it could issue the consent subject to a wide range of conditions. But it was expressly prohibited from imposing conditions that together amounted or contributed to an adaptive management approach.[55]
[54]Section 87F(1).
[55]Section 87F(4). See also s 63(2)(b). For the conditions that can be imposed, see ss 63 and 65–67.
Sections 87D to 87F outline the approach to be adopted by the EPA in considering and determining an application. They identify factors to be taken into account. But they do not specify the test to be applied when deciding whether a marine discharge consent should be granted in whole or in part, or declined. What is the question the EPA must ask, in relation to which the factors identified in s 59 are relevant?
We consider that it is clear from the scheme of the EEZ Act that the relevant test is found in the purpose statement in s 10(1). The EPA must ask itself whether granting a marine discharge consent (with appropriate conditions) will achieve both purposes identified in s 10(1):
(a)promoting the sustainable management of the natural resources of the EEZ and the continental shelf; and
(b)protecting the environment from pollution by regulating or prohibiting the discharge of harmful substances and the dumping or incineration of waste or other matter.
In this case neither the DMC nor the High Court recognised that s 10 provided the criteria by reference to which the application was to be determined. And neither the DMC nor the High Court identified the need for the EPA to expressly consider what decision would give effect to both limbs of s 10(1). In particular, when considering TTR’s application for a marine discharge consent the EPA needed to expressly consider whether granting such a consent would be consistent with the s 10(1)(b) purpose of protecting the environment.
Protecting the environment, in this context, means keeping the environment safe from harm caused by the discharge of harmful substances. In Environmental Defence Society Inc v Mangonui County Council Cooke P said, referring to the phrase “protection of [the coastal environment and the margins of lakes and rivers] from unnecessary subdivision and development”:[56]
In his careful argument … in this Court Mr Salmon put it that “protection” in para (c) is not as strong a word as prevention or prohibition; that it means keeping safe from injury and that a development may be permitted if the natural environment is more or less protected. Accepting this [apart] from the vagueness of “more or less”, I am nevertheless unable to accept that the Tribunal have found that the natural environment would be kept safe from injury. Read as a whole, their decision seems to me ambiguous on this important matter.
[56]Environmental Defence Society Inc v Mangonui County Council [1989] 3 NZLR 257 (CA) at 262. See also Royal Forest and Bird Protection Society of New Zealand Inc v New Plymouth District Council [2015] NZEnvC 219, (2015) 19 ELRNZ 122 at [63].
The definition of sustainable management in s 10(2) refers to avoiding, remedying or mitigating any adverse effects of an activity on the environment. It may be consistent with the s 10(1)(a) sustainable management purpose for an activity to cause adverse effects, provided those adverse effects are appropriately remedied or mitigated. But as the Supreme Court explained in Environmental Defence Society Inc v The New Zealand King Salmon Co Ltd, there are circumstances in which the broader sustainable management goal is most appropriately pursued through preservation or protection of certain aspects of the natural environment.[57] That is, by avoiding adverse effects on the natural environment. The Supreme Court held that protection of the natural environment was required by certain policies in the NZCPS (a topic we return to below). The same is true of s 10(1)(b) of the EEZ Act. In relation to marine discharges and marine dumping, the way in which the broader goal of sustainable management is to be pursued is by protecting the environment from harm caused by those activities. It is not consistent with s 10(1)(b) to permit marine discharges or marine dumping that will cause harm to the environment, on the basis that the harm will subsequently be remedied or mitigated. The s 10(1)(b) goal can only be achieved by regulating the activity in question (for example, by imposing conditions) in a manner that will avoid material pollution of the environment, or if that is not possible, by prohibiting the relevant discharge or dumping in question. As we explain at [109] below, the reference to regulating discharges or dumping is a reference to regulating those activities in order to pursue the goal of protecting the environment from pollution: it does not indicate that there are circumstances in which that goal need not be pursued.
[57]Environmental Defence Society Inc v The New Zealand King Salmon Co Ltd [2014] NZSC 38, [2014] 1 NZLR 593 at [149].
Thus, when the EPA considers an application for a marine discharge consent or a marine dumping consent, it is insufficient to consider the s 10(1)(a) sustainable management principle without going on to address the more specific goal in s 10(1)(b). To do so risks losing sight of the guidance given in para (b) about how the sustainable management objective is to be implemented in the context of marine discharges and dumping.
As explained at [26] above, New Zealand’s international obligations under the London Convention (including the 1996 Protocol) require marine dumping to be regulated in a manner that ensures protection of the environment. If an application for a marine dumping consent were to be determined by reference to s 10(1)(a), disregarding the more specific purpose set out in s 10(1)(b), that could result in outcomes inconsistent with New Zealand’s obligations under the London Convention. In the marine dumping context, the approach to s 10(1) that we have outlined above is necessary in order to ensure that the New Zealand legislation effectively implements relevant international obligations. The EEZ Act applies the more stringent standard of protection of the environment that is required by the relevant international instruments in the marine dumping context to a wider range of discharges. That is a deliberate policy choice which must be given effect in relation to all the activities to which s 10(1)(b) and the marine discharge and marine dumping provisions apply.
It follows that the criteria for marine discharge consents are different from, and more demanding than, the criteria with respect to marine consents generally. It is not consistent with the scheme of the EEZ Act to trade off harm to the environment caused by a marine discharge against other benefits, such as economic benefits. Nor is it consistent with the scheme of the EEZ Act to permit harm to the environment caused by a marine discharge on the basis that this harm will subsequently be remedied or mitigated. It would be inconsistent with s 10(1) for the EPA to grant a marine discharge consent if granting the consent is not consistent with the goal of protecting the environment from pollution. Protecting the environment — keeping it safe from harm caused by marine discharges or marine dumping — is in this sense a bottom line.[58] It is not open to the EPA to grant a consent for a marine discharge or marine dumping unless it is satisfied that the relevant activity is not likely to cause harm to the environment. If there is a real prospect of material pollution of the environment, a marine discharge or dumping consent should not be granted.
[58]The Supreme Court reached a similar conclusion in the RMA context in relation to certain policies set out in the NZCPS in Environmental Defence Society Inc v New Zealand King Salmon Co Ltd, above n 57, at [132]. The implications of the NZCPS for the present appeal are discussed in more detail at [181]–[203] below.
Consistent with the bottom line of protecting the environment from pollution caused by marine discharges or marine dumping, the EEZ Act provides for a lower tolerance for risk to the environment when making decisions about marine discharge and marine dumping consents. That is reflected in the prohibition on adaptive management approaches in this context. We return to this point below.
In light of this overview, we turn to the challenges advanced by the parties in relation to the decisions of the High Court and DMC.
Challenges to the decisions below
The appeal by TTR and the cross-appeals by other parties raised numerous overlapping issues. The following sections of the judgment address the challenges to the High Court decision which we consider have been made out. We then describe briefly the numerous challenges that are not in our view well-founded.
We adopt the same approach taken in the High Court of grouping the various challenges by reference to the key issues they raise.
Approach to s 10 purpose statement
The issue
We begin by addressing a fundamental issue raised by the respondents: did the DMC and the High Court err by failing to correctly identify the statutory purpose in relation to marine discharge consents, and by failing to treat that purpose as the relevant decision-making criterion for TTR’s application for such a consent?
DMC decision
The DMC decision set out s 10,[59] and recorded, correctly, that the DMC needed to consider whether the application met the purpose of the EEZ Act.[60] The DMC summarised its understanding of the implications of s 10 briefly as follows:
12. Section 10 requires that the environment is protected from pollution and dumping of harmful substances and waste such as the residual material that will be returned to the seabed after processing and the extraction of iron ore.
13. The use of the resource must be regulated and controlled in such a way that meets the Act’s purpose of sustainable management. We are obliged to identify and to manage effects on the environment to achieve that purpose.
[59]Environmental Protection Authority Decision on Marine Consents and Marine Discharge Consents Application: Trans-Tasman Resources Limited: Exacting and processing iron sand within the South Taranaki Bight (August 2017) at [2.1] [DMC decision]. All references to the DMC decision are references to the majority decision in pt 1, unless otherwise stated.
[60]At [5.1].
In a section headed “Purpose of the Act” the DMC said:
117.The DMC is required to give effect to the EEZ Act (the Act). We need to consider whether [the] application meets the purpose of the Act and the framework for assessing that is set out in Sections 59 and 87D of the Act.
After reviewing the wide range of issues that were relevant to TTR’s application, the DMC turned, in chapter 7 of its decision, to what it described as its “Integrated Assessment” of the application. The introductory text in chapter 7 reads as follows:
The following part of our record of decision (Chapter 7-24) integrates the various matters covered in evidence and submissions which we set out in previous sections. Our intention in doing so is to achieve the purpose of the Act (Section 10) and more particularly the requirements under s 10(3), which require us to take into [account] specific decision making criteria and information principles.
The introductory paragraphs of chapter 7 expand on that approach in a section headed “Section 59 Summary and Analysis”:
928. We must take into account the decision making criteria and information principles set out in the Act. Specifically, this requires us to follow Sections 59 and 87D – which sets out a decision making framework; Section 60 – which lists matters to be considered in deciding the extent of effects on existing interests; and Sections 61 and 87E and 87F – which establish certain information principles. These matters are set out in Chapter 7-24.3 of our record of decision.
929. We note that pursuant to Section 59(5) of the EEZ Act, we have not given regard to:
(a) trade competition or the effects of trade competition; or
(b) the effects on climate change of discharging greenhouse gases into the air; or
(c) any effects on a person’s existing interest if the person has given written approval to the proposed activity.
After going through each limb of s 59, the decision of the majority comes to a somewhat abrupt end. Chapter 8 deals with conditions. The record of the decision then moves to the alternative view of the two dissenting members of the DMC. The only record of the majority’s overall assessment of the application is set out in the “Summary of Decision” at the beginning of the DMC decision, as follows:
Conclusion
43. Our assessment of the effects of this proposal is that, with the imposition of these conditions granting consent meets the purpose of the Act.
44. Pursuant to section 62(1)(a) and 87F(1) of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012, the application for marine consents and marine discharge consents by Trans-Tasman Resources Ltd to undertake restricted activities (listed in Appendix 1) is GRANTED and the consents are issued subject to conditions (listed in Appendix 2).
45. These marine consents and marine discharge consents expire 35 years after the date of the granting of the consents.
46. The reasons for granting the marine consents and marine discharge consents are set out below in this record of decision in accordance with section 69 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012.
High Court decision
In the High Court the consent opponents (the respondents before this Court) argued that the DMC did not follow the framework established by s 10. They submitted that the DMC majority failed to articulate any test by reference to which the application should be assessed. Rather, they argued, the DMC majority identified a series of factors that they said they took into account without explaining how they had done so, or what ultimate standard they had applied to decide whether the application should be granted.[61] They also argued that the DMC failed to directly address the s 10(1)(b) purpose of protecting the environment from pollution, and wrongly conflated it with avoiding, remedying or mitigating adverse effects.[62]
[61]High Court decision, above n 6, at [108].
[62]At [111].
The Judge did not accept that argument. The Judge noted that the DMC was clearly aware of the statutory purpose, setting s 10 out in full and making the observations set out at [95]–[98] above.[63]
[63]At [117].
The Judge considered that it was clear that the DMC had correctly identified the statutory purposes and, particularly in chapter 7, explained how they had taken the EEZ Act’s purposes into account in reaching their decision to grant the consents.[64]
[64]At [121].
The Judge said:
[119] At [117] of the Majority Decision, the DMC specifically acknowledged it was required to give effect to the EEZ [Act] and needed to consider whether the application met the purpose of the Act and the framework for assessing that, as set out in ss 59 and 87D of the Act. There is no doubt that the DMC correctly identified the purposes of the Act and the relevant criteria to apply in assessing whether the purposes were met.
Submissions in this Court
Before us the respondents reiterated their argument about the failure of the DMC to understand the function of s 10, and in particular s 10(1)(b), in the statutory scheme. They submitted that the Judge had made essentially the same mistake.
Mr J Smith QC, counsel for TTR, submitted that the DMC and the High Court had correctly understood and applied the purpose of the EEZ Act. In response to the complaint that the DMC had not identified and applied the relevant decision‑making criteria, he submitted that the DMC specifically considered whether it had sufficient information to make a decision and determined that it did. This, he said, was a factual finding which was entirely open to the DMC on the evidence. Mr J Smith emphasised s 10(3) and argued that the way in which the s 10(1) purpose statement was to be given effect was by taking into account the decision-making criteria specified in relation to particular decisions (in particular, in this context, s 59 as modified by s 87D), and by applying the information principles. He also emphasised that s 10(1)(b) referred to regulating marine discharges, as well as prohibiting such discharges. He argued that this meant that the purpose of protecting the environment was not absolute.
Analysis
As we have explained above, it was essential that the DMC turn its mind to both limbs of the purpose provision in s 10(1). In particular, the DMC needed to ask itself:
(a)whether granting the marine consents sought would give effect to the sustainable management objective set out in s 10(1)(a); and
(b)whether granting a marine discharge consent in this case would be consistent with the objective set out in s 10(1)(b) of protecting the environment from pollution caused by discharges of harmful substances.
The DMC considered that having regard to the circumstances of the application and taking into account the legal and technical advice that they received, a bond was not necessary in addition to this public liability insurance.[151]
[151]At [1074].
Kiwis Against Seabed Mining Incorporated and Greenpeace of New Zealand Incorporated (KASM/Greenpeace) argued in the High Court that in deciding not to require a bond, the DMC erred in law.[152] On appeal before this Court they argued that the High Court erred in law in upholding the approach of the DMC that treated a bond and insurance as alternatives.
DMC decision
[152]High Court decision, above n 6, at [301].
The DMC decision referred to evidence about the purpose of a bond (to secure the performance of one or more conditions of the consent), and the process for setting the amount of a bond.[153]
[153]DMC decision, above n 59, at [1072].
As noted above, the DMC decided that a bond was not necessary in addition to the public liability insurance required under the consent conditions.[154]
High Court decision
[154]At [1074].
The Judge did not accept KASM/Greenpeace’s submission that bonds and insurance serve different purposes, and that the DMC had erred in law in treating them as alternatives. The Judge said:
[305] It is clear that the legislature, in s 63, sees both the requirement for a bond and public liability insurance, as acceptable alternatives to be imposed by way of condition where deemed necessary. The suggestion that the Act envisages that the two will be imposed, for different purposes, is unjustified. They are both clearly related to conditions that the marine consent authority may impose to deal with adverse effects of an activity authorised by the granting of a consent. There is nothing in either ss 63 or 65 of the Act that indicates that bonds are regarded differently to public liability insurance as a means of providing a safeguard to ensure compliance with conditions.
The Judge observed that the requirement for a bond, or for maintenance of public liability insurance, is discretionary.[155] There is no requirement that either be imposed.[156] The Judge concluded that the DMC’s decision to exercise its discretion under s 63(2)(a)(ii) rather than s 63(2)(a)(i) was neither irrational nor unreasonable. It did not amount to an error of law.[157]
Submissions on appeal
[155]High Court decision, above n 6, at [310].
[156]At [310].
[157]At [312].
KASM/Greenpeace submitted that the approach of the High Court misunderstood the different purposes served by public liability insurance and bonds. The failure to appreciate this difference meant that proper consideration had not been given to whether a bond was appropriate, in addition to insurance, to ensure compliance with conditions. This was an error of law.
TTR submitted that the Judge was right to find that it was open to the DMC to exercise its discretion not to require a bond. There was no error of law in the approach adopted by the DMC to this discretionary decision.
Analysis
We consider that the DMC and the High Court erred in treating a bond and public liability insurance as alternative ways of achieving similar outcomes. As a result, the DMC failed to identify the different purposes served by a bond and failed to turn its mind to whether a bond was required to ensure that the conditions attached to the consent were implemented; in particular, the conditions relating to ongoing monitoring and remediation.
The public liability insurance required by the consent conditions does not address costs of remediation for uninsurable harms; harms caused by planned activities; or harms resulting from a failure by TTR to act, for example due to deliberate non-compliance with conditions or supervening insolvency. These are all scenarios in which a bond, if required, would be available to meet the cost of ensuring that the steps required by the relevant conditions are taken. The DMC needed to turn its mind to whether a bond should be required in order to achieve these objectives, having regard to the risks that such a bond would address and any countervailing reasons for not requiring a bond. It did not do so.
We consider that the High Court should have upheld the KASM/Greenpeace submission on this issue. The appropriate response to this error, taken alone, would have been to require the DMC to reconsider its decision not to require a bond in light of the guidance provided in this judgment. We return to the question of relief below.
Effects on seabirds and marine mammals
The issue
The information available to the DMC in relation to the presence and distribution of seabirds and marine mammals in the South Taranaki Bight (STB), and the potential effects of TTR’s mining activities on seabirds and marine mammals, was limited. The DMC decision responded to this uncertainty by imposing conditions that required pre-commencement monitoring, and specified high level objectives relating to harm to seabirds and marine mammals (such as avoiding adverse effects at a population level) that would be fleshed out in management plans prepared by TTR and submitted to the EPA for certification.
The Royal Forest and Bird Protection Society of New Zealand Inc (Forest and Bird) say that the conditions imposed by the DMC in relation to seabirds and marine mammals are too imprecise to be enforceable, and impermissibly delegate to management plans matters properly the subject of conditions. Forest and Bird say the issue was not dealt with in the High Court decision. They have pursued it on appeal before this Court.
DMC decision
The information before the DMC established that there is significant diversity of marine mammals in the general region of which the STB forms part. The species present include three nationally critically endangered species — the Maui’s dolphin, killer whale and Bryde’s whale — and three nationally endangered or vulnerable species — the Hector’s dolphin, bottlenose dolphin and southern right whale. There was also evidence of the presence of blue whale, a migratory species that is internationally critically endangered. But the evidence about habitats and population numbers in the area was incomplete, and subject to a number of uncertainties.[158] The evidence about effects on marine mammals, and in particular the effect of marine noise, was also uncertain in a number of respects.[159] The DMC findings expressly acknowledged the absence of comprehensive well-researched species‑specific and habitat-specific information about noise effects on marine mammals.[160]
[158]DMC decision, above n 59, at [442]–[481].
[159]At [482]–[562].
[160]At [544].
The DMC noted that:[161]
… the STB is visited by a diverse range of seabirds that either pass through or forage in the region. However there have been no systematic and quantitative studies of the at-sea distributions and abundances of seabirds within the area.
[161]At [563].
The DMC concluded that:[162]
… there is a lack of detailed knowledge about habitats and behaviour of seabirds in the STB. It is difficult to confidently assess the risks or effects at the scale of the Patea Shoals or the mining site itself.
[162]At [579].
Against the backdrop of this uncertainty, the DMC included conditions relating to seabirds and marine mammals in the consent conditions. Condition 9 in relation to seabirds provides as follows:
9. At all times during the term of these consents, the Consent Holder shall comply with the following:
a. There shall be no adverse effects at a population level of seabird species that utilise the South Taranaki Bight that are classified under the New Zealand Threat Classification System as “Nationally Endangered”, “Nationally Critical” or “Nationally Vulnerable” or classified as “Endangered” or “Vulnerable” in the International Union for the Conservation of Nature “Red List”; and
b. Adverse effects on seabirds, including but not limited to effects arising from:
i. Lighting (including the Integrated Mining Vessel (“IMV”), Floating Storage and Offloading Vessel);
ii. Spills; and
iii. The effect of sediment in the water column on diving birds that forage visually
shall be mitigated, and where practicable avoided.
Extensive conditions were included in condition 10 in relation to marine mammals, including the following:[163]
[163]The DMC decision divides subparagraph 10(a)(ii) into two separate subparagraphs, but this appears to be a typographical error and we have corrected it in the quoted passage.
10. Notwithstanding the requirements of Conditions 11, 37, 67 and 88, with respect to marine mammals (excluding seals), the Consent Holder shall ensure that:
a. There are no adverse effects at a population level on:
i. Blue whales; or
ii. Marine mammal species classified under the New Zealand Threat Classification System as “Nationally Endangered”, “Nationally Critical” or “Nationally Vulnerable”; or
iv. Marine mammal species classified as “Endangered” or “Vulnerable” in the International Union for the Conservation of Nature “Red List”;
that utilise the South Taranaki Bight.
b. Adverse effects on marine mammals, including but not limited to effects arising from:
i. Noise;
ii. Collision and entanglement;
iii. Spills; and
iv. Sediment in the water column,
are avoided to the greatest extent practicable.
…
In addition, condition 11 imposed limits on underwater noise generated by the operation of marine vessels and project equipment.
Condition 48 provided for two years of environmental monitoring to be undertaken before mining operations begin. The list of matters to be monitored includes marine mammals and seabirds, as well as SSC levels. The purpose of the pre-commencement monitoring would include establishing a set of environmental data that identifies natural background levels while taking into account spatial and temporal variation of the various matters to be included in the plan. The pre-commencement monitoring would, among other matters, inform preparation of an Environmental Management and Monitoring Plan (EMMP) in accordance with condition 55. The EMMP would be submitted to the EPA for certification that it meets the requirements of the relevant conditions (with certification deemed to have occurred if the EPA has not given a decision within 30 working days). Condition 54 then requires ongoing environmental monitoring of a range of matters including marine mammals, to be undertaken in accordance with the EMMP.
Condition 66 provided for TTR to prepare a Seabird Effects Mitigation and Management Plan (SEMMP) to set out how compliance with condition 9 would be achieved, including setting out indicators of adverse effects at a population level of seabird species that utilise the STB. The SEMMP is required to be submitted to the EPA for certification that the requirements of the condition have been met.
Similarly, condition 67 provided for TTR to prepare a Marine Mammal Management Plan (MMMP) which sets out, among other things, how compliance with condition 10 will be achieved, and indicators of adverse effects at a population level of marine mammals that utilise the STB listed in condition 10(a). The MMMP is required to be submitted to the EPA for certification that the requirements of the condition have been met.
High Court decision
The Judge recorded that the consent opponents all submitted that there was inadequate information about the proposal’s impacts on matters such as benthic ecology, marine mammals, fish and shellfish, seabeds, ocean productivity, and the effect of the sediment plume generally.[164] The Judge said that:[165]
… as most of these matters overlap with the appellants’ arguments that the conditions imposed by the DMC to address these issues amount to the implementation of a prohibited “adaptive management” regime, I will address them in the part of this decision that focusses on that topic.
[164]High Court decision, above n 6, at [300].
[165]At [300].
However, there is no further discussion of the DMC approach to seabirds in the High Court decision. There are some further references to marine mammals, but these occur in other contexts. The High Court decision did not address the specific complaints that the seabird and marine mammal conditions are imprecise and involve impermissible delegations.
Submissions on appeal
Before us, Forest and Bird renewed its submissions that the conditions imposed in relation to seabirds and marine mammals were unlawful, because they were too imprecise and impermissibly delegated to management plans matters that should have been addressed and determined by the DMC. Forest and Bird say that the general requirement to avoid “adverse effects at a population level” is so open-ended as to be meaningless. TTR is left to gather baseline information about the receiving environment, to define what amounts to an “adverse effect” on that environment, and to determine whether and how such effects might be attributable to its activities. Key decisions, and the gathering of information on which those decisions are based, are impermissibly left for another day and another decision-maker. The EPA was obliged to make these decisions at the time of consent, and to ensure it had adequate information to do so. If it did not have adequate information to make those decisions, the consent should have been declined.
TTR says in response that the use of management plans to establish detailed methods of compliance allows appropriate flexibility in the methodology, which is justified given the subject matter and the length of the consent term (35 years). The conditions do not leave the compliance outcomes to management plans. The conditions fix the outcomes in clear and absolute terms: for seabirds and marine mammals there must be no adverse effects at a population level. TTR also notes that these are not the only outcomes for seabirds and mammals that the conditions specify.
Nor was there any impermissible delegation. TTR had provided draft management plans which set out the measures it could take to ensure no adverse effects occurred at a population level. The DMC heard evidence from experts. It was open to the DMC to conclude that detailed methods could be developed, through the management plans, to ensure there would be no adverse effects at a population level. The DMC was entitled to conclude, and did conclude, that it would be both meaningful and achievable to address the potential adverse effects on seabirds and marine mammals at a population level in this manner.
Analysis
The conditions imposed by the DMC reflect a high level of uncertainty about the baseline in relation to the presence and distribution of seabirds and marine mammals, and about the likely effects of TTR’s mining activities on seabirds and marine mammals. That uncertainty was the product of incomplete information about those matters.
We consider that the DMC’s response to this level of uncertainty was inconsistent with the EEZ Act for a number of overlapping reasons:
(a)The level of uncertainty identified in the DMC decision, and reflected in the conditions imposed, engaged the requirement to favour caution and environmental protection in ss 61(2) and 87E(2). Granting consent on the basis of this level of information, and conditions of the kind imposed by the DMC, was not in our view consistent with that requirement.
(b)To the extent that the relevant effects were caused by the sediment plume, and thus relevant to the marine discharge consent sought by TTR, the high level of uncertainty meant that the DMC could not be satisfied that the s 10(1)(b) objective of protecting the environment from pollution caused by such discharges would be achieved.
(c)Imposing very general conditions about avoiding adverse effects on these fauna, and leaving the specific controls required in order to avoid such effects to management plans prepared by TTR and submitted to the EPA for certification, was inconsistent with the scheme of the EEZ Act and the public participation rights for which it provides. Submitters should have an opportunity to be heard on these topics. The result of deferring these issues to management plans was to remove submitters’ rights to be heard by the decision-maker with responsibility for determining these important issues.
The High Court erred in law in failing to uphold this challenge to the DMC decision.
Other issues raised by cross-appeals
There are a number of other challenges to the High Court decision advanced by the respondents in their cross-appeals that we consider are not made out. In light of the conclusions we have reached above, we deal with these very briefly below.
Obtaining information from submitters
The respondents submitted that the High Court erred in finding that it was appropriate for the DMC to obtain information from submitters on issues where there were gaps in the information provided by TTR. The argument appeared to be that this was inconsistent with the burden on the applicant to satisfy the EPA that the consent should be granted.
We do not consider that there was any error of law on the part of the DMC in seeking additional information from any submitter that was able to provide such information, including requiring experts called by submitters to participate in conferences. Seeking further information and requiring conferencing fall squarely within the powers of the EPA to seek advice or information from any person and conduct a hearing in a manner that is appropriate and fair in the circumstances.[166]
Best available information
[166]EEZ Act, ss 44, 49 and 53. See also s 55 which provides that certain provisions of the Commissions of Inquiry Act 1908 apply to hearings.
KASM/Greenpeace argued that the DMC erred in adopting a standard of “sufficient information”, and making its decision on the basis of the “information to hand”, rather than applying the required standard of “best available information”.
This submission was founded on observations in the DMC decision about the DMC having sufficient information to make a decision, and the need to make a decision on the information to hand.[167] The High Court judgment also refers to DMC Minute 46 of 31 May 2017, which recorded the unanimous decision of all members of the DMC that they “have received sufficient information to make a decision and will not be seeking further information from any party”.
[167]DMC decision, above n 59, at [37]–[39] and [86].
As set out above, “best available information” is defined to mean the best information that, in the particular circumstances, is available without unreasonable cost, effort or time.[168] The DMC needed to determine, in the exercise of its judgment, whether it had obtained the best available information and then proceed to make its substantive determination in relation to TTR’s application. As we explained above, if the information available was inadequate to support the grant of a consent, consistent with the information principles and s 10(1), then the consent would be refused. Any inadequacy in the information available to the DMC would disadvantage the applicant, not other submitters.
[168]EEZ Act, ss 61(5) and 87E(3).
There is nothing to suggest that the DMC applied an incorrect legal test in determining that it had obtained the best available information. We do not consider that an inference to that effect can be drawn from the language used in the Minute referred to above. KASM/Greenpeace’s argument that the information available to the DMC was not the best available information in this case, applying the relevant standard, does not raise a question of law in respect of which there is a right of appeal to the High Court or to this Court.
Relevance of international law
KASM/Greenpeace argued that relevant international law instruments, including the LOSC and the Biodiversity Convention, should have been taken into account as “other applicable laws” under s 59(2)(l).
The international law framework is relevant to the interpretation of the EEZ Act, as we have explained above. In particular, the EEZ Act can and must be interpreted to give effect to the instruments referred to in s 11: the LOSC, the Biodiversity Convention, MARPOL and the London Convention (including the 1996 Protocol). The approach we have adopted to s 10(1)(b) is informed by these instruments, and is designed to ensure that the EEZ Act will secure compliance with New Zealand’s obligations under those instruments, as s 11 confirms it was intended to do.
We do not consider that it is helpful to take those international instruments into account separately, under s 59(2)(l), in addition to looking to them to inform the interpretation of the EEZ Act. Provided the Act is properly interpreted, the result of applying the Act will be to achieve consistency with New Zealand’s obligations under those instruments. Making separate reference to those instruments via s 59(2)(l) would not add anything of substance and would result in duplication of analysis and unnecessary complexity.
Pre-commencement monitoring
Forest and Bird submitted that conditions 48–51, which relate to pre‑commencement monitoring, are not conditions authorised by s 63 of the EEZ Act as they are not conditions “to deal with the adverse effects of the activity authorised by the consent on the environment or existing interests”. They say that this argument was advanced before the High Court, but is not addressed in the High Court decision. They reiterated the argument before us.
Section 63(1) permits the EPA to grant a consent on any condition that it considers appropriate to deal with adverse effects of the activity authorised by the consent on the environment or existing interests. We consider that a condition requiring pre-commencement monitoring falls squarely within this provision. It does deal with adverse effects, because it ensures they can be accurately identified and responded to.
It follows that the DMC did not err in law in imposing conditions of this kind. There was no relevant error in the High Court decision, which appears to have treated this issue as subsumed within the broader arguments about adoption of an adaptive management approach.
Casting vote
KASM/Greenpeace submitted that in circumstances where the DMC was equally divided, the Chairperson was required, as a matter of law, to specifically turn his mind to whether his casting vote should be exercised to grant the consent. They submit that this required separate consideration from the Chairperson’s decision on how to cast his deliberative vote. They also submitted that he should have given reasons explaining his decision to exercise his casting vote to allow the consent. They argued that in deciding to do so, he was required to favour caution and environmental protection, and that the fact that two of the four members considered there was inadequate and uncertain environmental information was a relevant factor he needed to take into account in deciding whether to exercise his casting vote in favour of granting the consent.
Counsel for KASM/Greenpeace were not able to identify any authority to support the argument that the exercise of the casting vote required separate consideration, that different factors were relevant in this context, and that separate reasons addressing those factors were required.
We do not consider that any additional overlay of caution was required in connection with the exercise of the casting vote, or that any factors were relevant to the exercise of the casting vote that were not also relevant to the Chairperson’s deliberative vote. There was no error of law in this respect.
Iterative approach to information gathering from TTR
The respondents submitted that it was inconsistent with the EEZ Act for the DMC to call for and receive evidence from TTR at a late stage in the hearing. They said that this affected the ability of other parties to effectively consider and respond to that evidence, contrary to the information principles under s 61 of the EEZ Act.
The iterative approach to information gathering adopted by the DMC, and the requests made to TTR for additional information in the course of the hearing, were authorised by ss 42, 44, 55 and 57 (pre-hearing) and ss 55 and 58 (in the course of the hearing), provided that this was done in a manner consistent with the requirements of natural justice.
We do not consider that any natural justice concerns amounting to errors of law were identified by the respondents in their cross-appeals. The concerns that were identified are more properly framed as concerns about the adequacy of the information available to the DMC in making its decisions. We have dealt with that issue above.
Failure to identify net economic benefits
KASM/Greenpeace argue that the High Court erred in finding that the requirement in s 59(2)(f) of the EEZ Act to take into account the “economic benefit to New Zealand of allowing the application” was met by the DMC. They say the DMC erred in law by failing to properly address the need for costs as well as benefits to be assessed (using a cost-benefit analysis); the need for environmental, social and cultural costs to be considered as part of an assessment of economic benefit; and the need to consider potential economic benefits that would be precluded or harmed by the activity.
We agree that consideration of the economic benefit of a proposal to New Zealand must focus on net economic benefit. It would be artificial and inappropriate to focus on gross benefits, disregarding economic costs. However, there is nothing in the DMC decision to suggest that the DMC made that error.
We consider that it was a matter for the DMC to decide how best to approach the assessment of economic benefit in a particular case. The EEZ Act does not require a cost-benefit analysis. That may well be an appropriate approach to adopt, in particular where economic benefit is a critical factor.[169] But it is not mandated by the EEZ Act.
[169]For an insightful guide to the appropriate use of cost-benefit analysis, and the ways in which unquantifiable factors can be incorporated into a cost-benefit analysis, see Cass Sunstein The Cost‑Benefit Revolution (MIT Press, Cambridge, 2018).
We do not consider that there was any error of law in the DMC’s decision not to seek to quantify, and include in a cost-benefit analysis, environmental, social and cultural costs. It was consistent with the scheme of the EEZ Act, and open to the DMC, to have regard to these matters on a qualitative basis. Indeed, we see force in TTR’s argument that taking those costs into account in the assessment of economic benefit, and then weighing them separately under other limbs of s 59, could give rise to double-counting.
Nor have we identified any error of law in the DMC’s approach to potential economic benefits in the counterfactual. The DMC did not consider that the evidence before it justified placing any weight on the effect of the proposal on possible future activities.[170] This was a matter for the DMC.
[170]DMC decision, above n 59, at [809].
In summary, the DMC did not err in law in its approach to economic benefit, and the High Court did not err in law in rejecting this ground of appeal.
Conclusion
We have upheld TTR’s argument that the approach adopted by the DMC was not an adaptive management approach that was inconsistent with the EEZ Act framework for marine discharge consents. The basis on which the High Court allowed the respondents’ appeal from the DMC decision, and quashed that decision, is not made out.
However, we have identified other defects in the DMC decision, some of them fundamental. Although these issues were raised in the context of cross-appeals by the respondents, we consider that they are for the most part better seen as grounds for upholding the result in the High Court on a different basis.[171] They provide further justifications for the orders made by the High Court allowing the appeal from the DMC, and quashing the DMC decision.
[171]See Arbuthnot v Chief Executive of the Department of Work and Income [2007] NZSC 55, [2008] 1 NZLR 13.
The only aspect of the respondents’ cross-appeals that requires consideration as a cross-appeal is their challenge to the order made by the High Court referring the matter back to the DMC for reconsideration, applying the correct legal test in relation to the concept of adaptive management.[172] The respondents say that the High Court should have declined the TTR application, rather than remitting it back to the DMC.
[172]High Court decision, above n 6, at [421].
We are not in a position to decide whether, in light of our conclusions on the questions of law raised by this appeal, TTR’s application should be declined. We are conscious that we do not have the benefit of a decision from the DMC or the High Court applying what we have found to be the correct test under s 10(1). Nor are we in a position to assess for ourselves whether it is possible that a more limited activity could be consented, or that other conditions could be imposed which would enable a consent to be granted that would be consistent with the objectives of the EEZ Act and the decision-making framework it prescribes. We therefore consider that the appropriate outcome is for TTR’s application to be referred back to the DMC to be considered in light of this judgment.
Result
TTR’s appeal is dismissed. The High Court decision to allow the respondents’ appeal and quash the decision of the DMC is upheld on other grounds.
In so far as the respondents’ cross-appeal seeks relief in the form of an order declining TTR’s application for a marine consent and marine discharge consent by TTR, that cross-appeal is dismissed.
TTR’s application is referred back to the EPA to be considered in light of this judgment.
The respondents have been substantially successful on appeal before us. Costs should follow the event in the normal way. We award costs as follows:
(a)We award one set of costs to Te Rūnanga o Ngāti Ruanui Trust, the Trustees of Te Kaahui o Rauru Trust, Te Ohu Kai Moana Trustee Ltd, Cloudy Bay Clams Ltd, Fisheries Inshore New Zealand Ltd, New Zealand Federation of Commercial Fishermen Inc, Southern Inshore Fisheries Management Co Ltd, Talley’s Group Ltd and the Taranaki-Whanganui Conservation Board for a complex appeal on a band B basis. We certify for two counsel, with usual disbursements.
(b)We award costs to Forest and Bird for a complex appeal on a band B basis, for one counsel only, with usual disbursements.
(c)We award one set of costs to KASM/Greenpeace for a complex appeal on a band B basis, for one counsel only, with usual disbursements.
Solicitors:
Atkins Holm Majurey, Auckland for Trans-Tasman Resources Ltd
Dawson & Associates, Nelson for Cloudy Bay Clams Ltd, Fisheries Inshore New Zealand Ltd, New Zealand Federation of Commercial Fishermen Inc, Southern Inshore Fisheries Management Co Ltd and Talley’s Group Ltd
Lee Salmon Long, Auckland for Kiwis Against Seabed Mining Inc and Greenpeace New Zealand Inc
Whāia Legal, Wellington for Te Ohu Kai Moana Trustee Ltd
Ocean Law New Zealand, Nelson for Te Rūnanga o Ngāti Ruanui Trust
Gilbert Walker, Auckland for The Royal Forest and Bird Protection Society of New Zealand Inc
Kāhui Legal, Wellington for Te Kahui o Rauru Trust
GLOSSARY
1996 Protocol Protocol to the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter (the London Convention)
Biodiversity Convention Convention on Biological Diversity
CMA Coastal marine area
Decision-making Committee
EEZ Exclusive economic zone
EEZ ActExclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012
EMMPEnvironmental Management and Monitoring Plan
EPA Environmental Protection Authority
Forest and Bird Royal Forest and Bird Protection Society of New Zealand Inc
Integrated Mining Vessel
KASM/Greenpeace Kiwis Against Seabed Mining Inc and Greenpeace of New Zealand Inc
LOSC United Nations Convention on the Law of the Sea
London Convention Convention on the Prevention of Marine Pollution by Dumping Wastes and Other Matter
MACAMarine and Coastal Area (Takutai Moana) Act 2011
MARPOLInternational Convention for the Prevention of Pollution from Ships
MMMP Marine Mammal Management Plan
NKTT Ngā Kaihautū Tikanga Taiao
NZCPS New Zealand Coastal Policy Statement
RMA Resource Management Act 1991
SEMMP Seabird Effects Mitigation and Management Plan
SSC Suspended sediment concentration
STB South Taranaki Bight
TRG Technical Review Group
TTR Trans-Tasman Resources Ltd
Treaty Treaty of Waitangi
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