The 'red zone' created in the aftermath of Christchurch's earthquakes was legal, the Court of Appeal has ruled.

The appeal arose from proceedings by Fowler Developments Ltd and Quake Outcasts challenging the lawfulness of the creation of the Christchurch residential red zone, and the making of offers to owners of vacant land and uninsured improved properties in the red zone.

The High Court had ruled both of actions were unlawful, however the Court of Appeal has partially allowed the appeal of the Minister for Canterbury Earthquake Recovery and the chief executive of the Canterbury Earthquake Recovery Authority (CERA).

In a unanimous judgment, the Court of Appeal found the red zone was lawfully created and the decision to make offers to purchase the properties from owners of vacant land and owners of uninsured improved properties was not lawfully made.