The Regional Council proposed a Nitrogen cap and trade system to improve the water quality of traditionally, culturally and economically important Lake Taupo. The farming activities surrounding the Lake were identified as a major contributor to the decline in water quality. This plan was outlined and set out by the Waikato Regional Plan Variation 5 (WRPV5).

The significance of this case is that regulating nitrate leaching into waterways from agriculture (as opposed to point source polluters) has had limited application in other jurisdictions.

Elements of the Waikato Regional Plan Variation 5 that were in contention during this case were the costs recovery, the use of the nitrogen budgeting model, what activities would be covered by the program,

It was held that farming activities contributed so significantly to the issue that other activities did not need to be considered in the plan.

To give effect to the policy it was held that a rule providing for the complexity of determining Nitrate leaching levels was necessary. The use of the OVERSEER computer model was agreed upon.

The jurisdiction of the court to amend the rules was also in question however it was held that the court could amend rules and require additions.

(Summary provided by Eva Sheppard from the Queensland University of Technology)