Water-bottling consent decision before Supreme Court

Our Chief Executive Dr Stefanie Rixecker welcomes the clarity the current Supreme Court case (regarding our previously granted resource consents to Cloud Ocean Water Limited and Rapaki Natural Resources for water bottling purposes) will give us and the community.

"This matter has been before the Courts for some time, so I am sure everyone will appreciate a final determination.

We have taken a neutral position on the issue to be determined and will assist the court in its understanding of the context concerning the relevant regional planning framework in Canterbury.

We are not a defendant and we can’t speculate on what the Court will rule. In the meantime, we must continue to process consent applications in line with our legal obligations."

The Supreme Court of New Zealand has granted leave to Cloud Ocean Water Limited to appeal the Court of Appeal’s decision on Environment Canterbury granting resource consents to Cloud Ocean and Rapaki Natural Resources for water bottling purposes.

Aotearoa Water Action Inc argued before the Court of Appeal that Environment Canterbury unlawfully granted resource consents by failing to separately consider the water take from the use it was taken for. The Court of Appeal determined that under Environment Canterbury’s planning documents it was required to consider the take and use together.

The latest decision by the Supreme Court means a hearing will now take place to determine if the Court of Appeal was correct in ruling that Environment Canterbury did not have the legal grounds to grant the consents.

The hearing is anticipated to occur in March 2023, with a decision expected later in the year.

The application for leave to appeal to the Supreme Court was made by Cloud Ocean.  Environment Canterbury did not seek leave to appeal the Court of Appeal’s decision and wasn’t part of Cloud Ocean’s application for leave to appeal.

We will, however, follow through in our legal duties as a relevant party in the upcoming hearing process.

Environment Canterbury recognises that this matter has been proceeding before the Courts for some time, and welcomes any further certainty the Supreme Court may provide in its final determination of the case.

What this means for current consent applications

Until any decision is made by the Supreme Court, consents will be processed in line with the Court of Appeal’s recent decision.

Based on the timings around the hearing in March and an expected date for the Supreme Court’s decision, we will work with relevant consent applicants on a case-by-case basis to determine the most appropriate approach for processing their consent applications.

Environment Canterbury has decided it will not seek leave to appeal the recent decision of the Court of Appeal on its grant of consents for Cloud Ocean Water Limited and Rapaki Natural Resources Limited to carry out water bottling activities at plants previously used for other industrial activities.

In 2020, the High Court upheld the grant of the consents, but Aotearoa Water Action Inc appealed that Court’s decision to the Court of Appeal.

In July of this year the Court of Appeal found that Environment Canterbury could not grant a resource consent that was limited to the use of the water for bottling purposes separately from the authorisation to take the water to be used for that purpose.

This meant the consents granted to the two water bottling companies were not lawfully granted and resulted in the consents being set aside.

Chief Executive Dr Stefanie Rixecker said the outcome from the Court of Appeal decision was certainty about how the rules around water “take” and “use” should be applied.

“This allows us to proceed confidently when considering future consent applications,” she said.

A “take” authorises how much water can be removed from any water body (surface water bodies like rivers, or from groundwater / aquifers), while a “use” authorises the purpose for which water is used, such as irrigation, water bottling or hydro-electricity generation.

“While the Resource Management Act allows take and use to be separated, the Canterbury Land and Water Regional Plan does not, so further litigation is unnecessary,” Dr Rixecker said.

“We are considering how we deal with consents granted under the former (at that time, lawful) approach. We are also assessing how many granted consents are affected, but those consents remain valid unless a Court issues a decision to set them aside. Environment Canterbury can’t revoke any of these consents because the law doesn’t allow us to do that.”

Environment Canterbury received the decision of the Court of Appeal on its grant of consents for Cloud Ocean Water Limited and Rapaki Natural Resources Limited to carry out water bottling activities at plants previously used for other industrial activities.

In 2020, the High Court upheld the grant of the consents, but Aotearoa Water Action Inc appealed the Court’s decision to the Court of Appeal.

The decisions granting the consents were set aside. Chief Executive Stefanie Rixecker said Environment Canterbury was considering the implications of the decision.

 "We have been working according to the High Court decision since it was delivered and were reassured by that Court’s view that our processes were robust," she said.

The Court of Appeal’s decision turned on whether applications for the take and use of water must be considered together. It was noted that this issue had not previously been addressed by that Court.

"This is evidently a significant decision which will have implications well beyond water bottling," Dr Rixecker said. "We now need to take the time to consider what those implications may be, particularly in terms of our consents processing."

Having reached its conclusion, the Court set aside the resource consents held by Cloud Ocean Water and Rapaki Natural Resources.

The Court also noted that it was "unnecessary for us to go on to consider the other issues raised about the impact of selling water in plastic bottles and the adverse effects on cultural values arising from the water bottling activity.

"Nor is it now relevant to consider whether the Council’s decisions to deal with the applications without requiring notification or limited notification were also unlawful".

Read the full decision (PDF File, 463.8KB).

Environment Canterbury is pleased with a High Court decision (PDF file 1.33 MB) that it correctly applied the law and did not exceed its jurisdiction in approving consents to take water used for water bottling. It also welcomes the clarity the decision provides for those concerned about water bottling and the wider management of water in Canterbury.

“Environment Canterbury’s role is to protect water at its source, and it’s a responsibility we take seriously to ensure water is available now and in the future. We’ve most certainly heard the community’s concern about water and water bottling in particular, but we have to apply the law as it stands, which this decision confirms we have done,” Environment Canterbury Acting Chief Executive Stefanie Rixecker said.

Aotearoa Water Action (AWA) sought a judicial review after Environment Canterbury granted non-notified consents to Cloud Ocean and Rapaki Natural Resources allowing existing consents to take water to be used for water bottling instead of at a meat works and woolscour.

An independent commissioner acting for Environment Canterbury later granted Cloud Ocean consent to take water from a deeper bore, within its existing allocation. AWA argued that the applications were for new water – effectively for a prohibited activity in the fully-allocated Christchurch-West Melton zone, and that the applications should have been declined.

No error found in consent decision process

The High Court decision found no reviewable error in the way the Council dealt with the applications. It confirmed that Environment Canterbury was correct in considering the existing consents to take water as separate from authorisations to use that water, and that a standalone "use" consent for water bottling could be relied on to authorise the use of water taken under another water permit.

The decision noted: “It is not the function of the Court on an application for review to substitute its own decision for that of the consent authority. Nor will the Court assess the merits of the resource consent application or the decision on notification. The inquiry the Court undertakes on an application for review is confined to whether or not the consent authority exceeded its limited jurisdiction conferred by the Act. In practice, the Court generally restricts its review to whether the Council as decision maker followed proper procedures, whether all relevant and no irrelevant considerations were taken into account, and whether the decision was manifestly reasonable.”

The administrative transfer of consents was also not contested, and the Court confirmed that Environment Canterbury was correct to not revisit the effects of the existing consents to take water, and that the plastic bottles resulting from a water-bottling plant were beyond what could be considered as part of a consent to use water for bottling.

Water bottling and Christchurch aquifers

The Court noted scientific evidence given by Environment Canterbury relating to the volume of water in the Christchurch aquifers and that its use was uncontested.

That evidence stated that the water flowing through the aquifers was assessed at 369 million cubic metres per year. Of that, 152 million cubic metres per year is allocated for use by people living and industries based in Christchurch. Of that, 82 million cubic metres per year is allocated to the Christchurch City Council for distribution to households and small businesses – of which about 70 percent was used.

Based on average water usage figures, without allocating any more water, Christchurch could accommodate 17 percent population rise. If average water use were 300 litres per person per day, little more than the current average use of water by Auckland residents, the Christchurch population could rise by 76 percent without requiring any further allocation. The 10 million cubic metres allocated per year for water bottling was about 2.7 percent of the water in the Christchurch aquifers.