Fulton Hogan's failure to abide by an Environment Court resource consent condition for extracting gravel from a Shotover River site is contempt of court, Queenstown solicitor Russell Ibbotson claims.
But Fulton Hogan regional manager Alan Peacock said circumstances had "changed dramatically" since they agreed last year to tarseal an access road to the extraction site, and his company was "in discussion" with the Queenstown Lakes District Council regarding the long-term operation of gravel extraction.
QLDC chief executive Duncan Field also disagreed with the contempt of court claim, saying the road would be sealed this summer.
Sealing the road was a condition of an Environment Court appeal decision last October, Mr Ibbotson said, and Fulton Hogan had agreed to do it within three months of being granted resource consent.
Ten months later, the work had still not been done.
Mr Ibbotson acts for Quail Rise Estate Ltd, which was party to an appeal against Fulton Hogan last October opposing the original consent, along with Avi and Wendy Yochay, who live near the site.
At the appeal hearing, Fulton Hogan agreed to requests by Quail Rise and the Yochays to mitigate the dust and noise.
On November 29 last year, Mr Ibbotson wrote to Fulton Hogan's counsel, requesting the company abide by the conditions, but they had not yet responded.
"Quail Rise had to hire planners, lawyers, landscape architects - it's gone on for two years and finally got an agreement and now, 10 months later, nothing's been done," he said.
Mr Ibbotson estimated the whole process, from appearing at the original consent application hearing to the Environment Court and associated meetings, had cost his client up to $35,000.
Not only was it a "smack in the face" for his client, but constituted a failure to carry out the conditions endorsed by the court and was therefore contempt of court, Mr Ibbotson said.
"So, out of sheer frustration, we've put it before the court."
Mr Peacock said the road had not been sealed because Fulton Hogan was in negotiations with the QLDC for "the best long-term option outcome for the area".
The company was waiting on the possibility of a land-swap deal between the Otago Regional Council and the QLDC, which only became apparent last year soon after the court agreement on the conditions was signed.
"And as soon as the land-swap deal and tenancy agreement is sorted, we will seal it [the road]. And, if it's not sorted, we will leave."
Mr Peacock said Fulton Hogan needed a long-term lease on the land to make its operation worthwhile.
Otherwise, it would use its Cromwell site, which would result in gravel being hauled to Queenstown at considerable cost.
"To invest in the vicinity of $400,000 to seal the road, a lease suitable for this investment will be required," Mr Peacock said.
Under the land-swap deal, the lease was now uncertain, he added.
When Fulton Hogan signed the Environment Court agreement, there was no suggestion that the land swap would take place, Mr Peacock said.
"We would have spent in excess of $200,000 in gaining consent on that land and there are times when you wonder `why bother?"'Fulton Hogan voluntarily ceased extraction from the upstream site as a goodwill gesture to Quail Rise and the Yochays, Mr Peacock added.
Mr Field confirmed the council was in negotiations with Fulton Hogan and two other gravel extraction companies who operated nearby "to find a solution".
Fulton Hogan had signed up to the agreed conditions on the understanding it would be able to go ahead with its extraction activities.
"The contractors have advised us the cost of sealing the road was too onerous, given the short-term lease and volumes, so we're working to find a solution."
If Fulton Hogan did not go ahead with extraction, "it will be a considerable cost to the community" in added haulage, he said.
"What we have done is on clear legal advice."
There were "extenuating circumstances" with "significant repercussions for the whole community" regarding the issue.
Mr Yochay told the Otago Daily Times he had received an email from Lakes Environmental on August 14 saying the QLDC was "considering leniency" on the conditions agreed to in the Environment Court last October.
