Judge Brian Dwyer's decision was released this afternoon following a one-week trial in the Environment Court in Queenstown in April and May.
The Otago Regional Council prosecuted Northlake and Civil Construction Ltd over the discharge, which occurred at its Northlake subdivision, between Lake Wanaka and Albert Town, on August 17, 2017.
The discharge of silt and sediment-laden water caused discolouration for more than 500 metres downstream.
Civil Construction was convicted and fined $25,500 in January after pleading guilty.
Northlake denied the charge.
In a media statement, the regional council's chief executive, Sarah Gardner, said the decision showed the importance of environmental management during development.
The council was "increasingly concerned'' about water quality in areas where rapid urban development was causing high levels of disturbed sediment.
A spokeswoman for Northlake Investments said the company was reviewing the decision and considering all options, including appeal.
Sentencing is currently set down for September 2 in Queenstown.
