Court decision could impact property rights

A court ruling that confirms the National Conservation Council’s power of veto over projects that impact environmentally sensitive areas or species has sent ripples through the property development sector.

The ruling has been celebrated in some quarters as a pathway to a more sustainable future for Cayman.

But some developers fear it could negatively impact the economy and curtail necessary infrastructure projects, including housing and highway developments. It could also lead to compensation claims from landowners if the application of the law impacts development opportunities, and therefore the value of property purchased in good faith, one veteran Cayman developer warned.

The ruling

The Grand Court ruled last week that the Department of Environment, with delegated authority from the National Conservation Council, was within its rights to instruct that certain planning applications be rejected.

The case centred on an infamous cabana and seawall on Boggy Sand Road that is so close to the waterline it is practically in the sea at high tide. The Central Planning Authority had approved a plan to rebuild the structure, despite an instruction from the DoE that it be denied.

In an historic first, two government departments – the National Conservation Council and the Central Planning Authority – faced off in court over the issue. 

Acting judge Alistair Walters ruled that the National Conservation Act stipulates that where the conservation council determines that a project could have an adverse impact on a protected area – in this case, the Seven Mile Beach Marine Park – it can issue a binding decree that the application be rejected.

The CPA has confirmed it will appeal the decision, but the implications of the initial judgment are still being digested and debated this week.

On the face of it, the ruling affirms the conservation council power of veto over any development that impacts an officially protected area or a critical habitat of a protected species. That could include a lot of coastal development bordering on marine protected areas or turtle nesting beaches, for example.

‘Positive step’ for environmental protection

Sustainable Cayman hailed the judgment as a “very positive step for environmental protection in the Cayman Islands”, saying it was delighted with the outcome.

Melanie Carmichael, of the non-profit group, said the planning authority, which has been criticised in the past for being too pro-development, could no longer ignore the concerns of the conservation council.

“The continued erosion of our precious, pristine beaches as a result of poor development design and planning will hopefully come to an end as the CPA must accept that in certain circumstances, such as building on Cayman beaches and in Cayman waters, the steps the NCC stipulates to mitigate adverse impacts are binding conditions on a grant of permission, not just inconsequential recommendations,” she said.

Emily DeCou, of Amplify Cayman, believes the ruling should be welcomed by everyone – not just environmental advocates.

“This confirmation of the National Conservation Council’s powers is an immensely positive step forward, which shouldn’t be viewed as a hindrance for development,” she said, “but rather, as an opportunity for a positive partnership of stewardship between the council and the Central Planning Authority, who can unite with national pride and ensure our islands are developed equitably for current and future generations.”

Balancing act

There’s some sympathy for that perspective, even among developers.

Dan DeFinis, head of the Cayman Contractors Association, said compromise on both sides was likely the way forward.

“I think the general consensus is that more sustainable development is needed and that’s the way to go, and it would behoove the industry to steer in that direction. That said, we also have a housing supply-and-demand issue that is making life difficult for many people in our society,” he added.

DeFinis, engineering manager for Davenport Development, said it would make sense for the industry, the DoE, environmental advocates and others to come to the table to ensure the right balance is achieved on future development.

While the DoE and the conservation council have been relatively selective in their opposition to major projects in Cayman, he cautioned the ruling could have a large impact if interpreted too broadly.

For DeFinis, the extent and impact of the judgment, which effectively gives teeth to the council’s directions, will be seen on a case-by-case basis. 

“It is going to depend a lot on how they make their case about specific developments and how they’ll impact a specific vulnerable ecosystem,” he added.

Rather than instructing applications be rejected outright, the council also has the power to request or consider mitigating measures.

Its authority in relation to developments which impact protected land or species supersedes that of the planning authority and other government agencies but not Cabinet.

‘Too much power’ 

Nonetheless, some developers fear the ruling tips the balance too far in favour of environmental considerations.

Dale Crighton, of Crighton Properties, warned government could face litigation if the new interpretation of the law impacted the value of land. If people had bought land in a certain zone with the understanding they would be able to develop and were no longer allowed to do so, he said they would be rightly entitled to compensation.

“If I bought a large parcel that was zoned for development and I was now told that due to this ruling I am now not allowed to develop the site because the National Conservation Council feels I should leave it as mangrove, I would be looking to Cayman Islands government for damages,” he said.

Investors bought land that came with specific zoning and a “bundle of rights” that could not be tampered with, he added.

Crighton said planning applications were already a long, drawn-out process that would now be subject to new delays and deterrents. While he said the Department of Environment usually makes sensible comments on applications, he believes the new dynamic gives it too much power. He added that the ruling could impact the value of undeveloped land.

“It was fine the way it was where various departments could comment on applications,” he said. “In my experience as a developer, DOE and other departments usually make sensible comments and planning certainly did take care in ensuring their comments and recommendations were taken into account.”