"We remain concerned with the undermining effect on te mana o te awa and the mana whakahaere of Waikato-Tainui and our hapū and marae along the river," she said in a statement.
"We will advise Watercare and the relevant local/regional government representatives of our decision as a matter of courtesy however our primary responsibility is to represent the interests of our awa and people."
Te Aho said Waikato-Tainui, which had a statutory interest in the governance of the awa, recognised it was a finely balanced decision.
"It is absolutely clear to us is that our tupuna river should not be used to fix decades of failed infrastructure investment," she said.
In the application for the appeal, seen by RNZ, Waikato-Tainui argued that the board of inquiry erred in law in some aspects of its decision.
It also said Watercare, in its processes and application, failed to recognise and provide for meaningful relationships with tangata whenua.