News —

Member Bob Hollyman QC acts in successful judicial review regarding lease and development of Wanaka Airport


May 5, 2021

Bob Hollyman QC recently acted for the Wanaka Stakeholders Group (WSG) in its successful judicial review of the Queenstown Lakes District Council’s decision to lease Wanaka Airport to the Queenstown Airport Corporation Ltd (QAC) in perpetuity (minimum 100 years).  The lease included the sale of the airport buildings and runway.

The decision is a landmark in local government as it involved the application of the consultation provisions in the Local Government Act 2002 (LGA) in relation to strategic assets, as well as the role and operation of a council-controlled organisation.  

WSG argued that, although there had been public consultation by the Council before the lease was signed in March 2018, that consultation process did not include significant matters that ultimately underpinned the Council’s decision to enter the lease.  Those included the length of the lease and the prospect of QAC developing Wanaka Airport to receive jet services as a dual capable airport with Queenstown Airport.

WSG also argued that the lease transaction (which included the sale of several major Wanaka Airport assets to QAC) amounted to the transfer of ownership or control over a strategic asset held by the Council that was required to be included in the Council’s long-term plan.  That had not occurred.

WSG said these failures amounted to breaches of the Council’s consultation and long-term planning obligations under the LGA.  It sought a declaration that the Council’s decision to enter the lease was unlawful and orders setting aside the lease.

WSG also raised issues relating to climate change and over-tourism, but because WSG succeeded on other grounds, these did not have to be considered by the Court.  

In a judgment delivered on 21 April 2021, the Court relevantly held that:

  • The terms of the lease went “considerably beyond” the scope of the Council’s initial lease proposal.  The Council therefore breached its obligations under Part 6, Subpart 1 of the LGA because its decision to enter the lease (including its 100-year term and the prospect of jet capability) was not a fair reflection of that proposal and related consultation process.
  • The Council’s entry into the lease and sale of related Wanaka Airport assets to QAC amounted to the transfer of control of a strategic asset under s 97 of the LGA, and the Council had therefore breached its obligations to expressly provide for and consult on that transaction in its long-term plan.

The Court therefore declared that the Council’s decision to enter the lease was unlawful and ordered that the lease be set aside.  That relief was appropriate because, had the lease remained in effect, the public would have had very limited input in the operation and development of Wanaka Airport for the next 100 years.

The Court declined to grant further orders restraining the Council and QAC from developing Wanaka Airport to receive jet services in future, noting that any such decision would be open to the Council provided it complied with the LGA.

To read the judgment, click here

To read the NBR coverage, click here

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