Three Waters: High Court rules against councils seeking ownership declaration


Three councils who sought to have their property rights declared by a court over the Three Waters reforms have had their bid been rejected by the High Court.

In a judgment this morning, Justice Mallon also ruled the councils' attempt to seek the declaration - while carefully phrased - in effect sought to influence the legislative process, a breach of the principle of Parliamentary sovereignty.

The Timaru, Waimakarere and Whangārei District councils had wanted the court to make three declarations*:

  • That local government is an important and longstanding component of the democratic governance of New Zealand
  • On long-standing principles of democratic governance, including that local infrastructure assets are owned or controlled, related services are provided by local councils, councils are responsive and democratically accountable for the provision of assets and related services, that they owe "fiduciary-like" obligations to the communities, and local infrastructure assets have been wholly or materially funded by communities.
  • That councils own their infrastructure assets and have rights to prevent others interfering, to manage and operate the assets, to enter into contracts relating to those assets, to use the assets as security for borrowing, and to compensation if their ownership is removed by legislation.

This was in response to the government's plan to shift management of Three Waters assets from 67 local councils to four large regional purpose-built entities, with the aim of being able to borrow much greater sums and prioritise infrastructure investment than councils could achieve alone.

In the judgment, Justice Mallon found the court did have jurisdiction over the matter, but such a declaration was outside the court's proper role because it infringed the principle that the court does not interfere with the legislative process.

She also found Parliamentary sovereignty meant the changes enacted in the Three Waters suite of legislation could be made even though it would change local democratic governance and accountability, even though local authorities would lose ownership without receiving compensation.

The declarations sought were also found to be too generally framed to be useful.

* (Paraphrased for brevity)