The Maori Council has lost its initial legal bid to delay the partial privatisation of Mighty River Power until Maori water rights are dealt with but is already working on an appeal.

In a three day High Court hearing late last month in Wellington the council argued that the Government should establish the extent of Maori ownership rights over freshwater and geothermal resources and make redress for them before the partial sale of Mighty River and other power companies under the Government's "mixed ownership model".

In the summary of his judgement released this afternoon, Justice Ronald Young said he was satisfied that three key decisions by the Government to advance its asset sales programme which were challenged by the council were not reviewable by the court.

Those decisions included the order-in-council or move to take Mighty River Power out from under the State Owned Enterprises Act and into the Public Finance Act to allow the sale, and the final decision to sell the shares.


However, Justice Young said that even if he was wrong on those points the council's bid case would have failed because when making each of those decisions the Government would not have been acting inconsistently with the Treaty of Waitangi.

Maori Council spokeswoman Rahui Katene said Justice Young had determined the matter "on a narrow legal issue".

"The moral issue has still be to addressed in public debate."

While Justice Young had taken the view that the Government's decision was not one the courts could review, the council was concerned "that government has not been willing to address the issue of indigenous water rights, as the Court itself noted, and has relied upon statutory technicalities".

"In this instance we think that the view taken about the statutory framework does not fit with previous court decisions and we are now working on an appeal."

Finance Minister Bill English and State Owned Enterprises Minister Tony Ryall said the decision vindicated their view "that the partial sale of shares does not in any way affect the Crown's ability to recognise rights and interests in water, or to provide redress for genuine Treaty claims".

Mr Ryall said the Government's share offer programme remained on track.

"If the High Court decision is appealed, we hope this can be heard as soon as possible."


Labour's SOE spokesman Clayton Cosgrove said the High Court's decision was "just the first in a number of steps for this appeal to go through".

"It is likely there will be an appeal and New Zealanders will again have to fork up the costs of court hearings."

Maori Council lawyer Felix Geiringer told the Herald he had already begun work on the council's appeal but it was not yet decided whether the council would seek to bypass the Court of Appeal and take the matter directly to the Supreme Court.

Mr Geiringer said he was disappointed with Justice Young's decision but not surprised. Justice Young's questions as he heard arguments from the council and the Crown had given an indication of his final decisions on key issues.

In his judgement, Justice Young said he was satisfied there was no connection or "nexus" between the sale of power company shares "and the need to provide for Maori claims to proprietary interest in water by way of potential redress or recognition of rights".

He was satisfied that the Government's consultation with Maori over the asset sales programme was "adequate" and undertaken without a predetermined stance "especially with respect to the Waitangi Tribunal's shares plus concept".

The Maori Council was assisted in its High Court challenge late last month by a group of Waikato River iwi and hapu. Their lawyer Helen Cull QC had argued the Government had breached the terms of earlier settlement legislation dealing with the river by not adequately consulting relevant iwi over the sales plan.

But Justice Young said there was no breach of the Waikato-Tainui Raupatu Claims (Waikato River) Settlement Act 2010.

"The sale of share was not a sale that required the Crown to engage with Waikato-Tainui."