NEW ZEALAND AVIATION FEDERATION (INC) v CIVIL AVIATION AUTHORITY OF NEW ZEALAND [2021] NZHC 2674

NEW ZEALAND AVIATION FEDERATION (INC) v CIVIL AVIATION AUTHORITY OF NEW ZEALAND[2021] NZHC 2674 [7 October 2021]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-A-TARA ROHECIV-2020-485-000332[2021] NZHC 2674UNDER the Judicial Review Procedure Act 2016IN THE MATTER OF an application for reviewBETWEEN NEW ZEALAND AVIATIONFEDERATION (INC)ApplicantAND CIVIL AVIATION AUTHORITY OF NEWZEALANDFirst RespondentTHE DIRECTOR OF CIVIL AVIATIONSecond RespondentHearing: 12 & 13 April 2021Counsel: G D Pearson and M Byczkow for the ApplicantK I Murray and J F Parnell for the RespondentsJudgment: 7 October 2021Reissued: 11 October 2021JUDGMENT OF GWYN JSolicitors:Civil Aviation Authority, WellingtonIsherwood Le Gros, NelsonCopy to:Kim Murray, WellingtonGrant Pearson, NelsonTABLE OF CONTENTSIntroduction [1]The parties [5]Regulation of civil aviation in New Zealand [9]Move to Global Navigation Satellite Systems [20]"New Southern Sky" (NSS) [24]Legal context [32]International [32]New Zealand [40]Civil Aviation Rules (CAR) and the Exemptions [41]Powers to make rules and exemptions from rules [41]CAR Subpart D [45]Other CARs relevant to GPS IFR operations [52]The 2010 Exemption and the 2020 Exemption [54]The principal issue – what does CAR 19.207(3) mean? [61]The NZAF's submission [62]CAA's submission [75]Discussion [86]Meaning of CAR 19.207(3) [90]Grounds for relief [105]Did the Director have authority under 37(2)(d) of the Act to issue the Exemption?[108]The Director imposed conditions on the 2020 Exemption that rendered it whollyineffective [114]Was the 2020 Exemption issued for the purpose of de facto regulation of PBN?[117]Was the 2020 Exemption an abuse of a discretionary power? Was therespondents' conduct of this litigation in bad faith? [123]Was the Director required to consult with the aviation industry before issuing the2020 Exemption? [129]Was the 2020 Exemption unreasonable? [132]Result [134]Costs [135]Appendix A: 2010 ExemptionAppendix B: 2020 ExemptionIntroduction[1] This judicial review application arises in the context of the operation of civilaircraft in New Zealand. The New Zealand Aviation Federation (NZAF) seeks adeclaration that an exemption from a requirement in the Civil Aviation Rules, whichwas issued by the Director of the Civil Aviation Authority of New Zealand (CAA) on10 August 2020, is void and of no effect.1[2] The exemption in question (the 2020 Exemption) relates to a provision in theCivil Aviation Rules (CAR) concerning the operation of an aircraft under InstrumentFlight Rules (IFR) using Global Positioning System (GPS) as a primary navigationsystem.[3] The NZAF pleads a number of review grounds, including lack of statutoryauthority, exercise of a power for an improper purpose (de facto regulation ofperformance based navigation), and Wednesbury unreasonableness – all of whichultimately turn on the interpretation of the Civil Aviation Rule governing flights whichuse GPS equipment as their primary means of navigation: CAR 19.207(3).[4] The NZAF also alleges improper purpose by the Director of the CAA ("theDirector"), alleging that the issue of the 2020 Exemption was an attempt to thwart thisproceeding, which was filed by the NZAF on 29 June 2020 challenging an earlierexemption relating to the same CAR which had been issued on 1 December 2010 (the2010 Exemption).The parties[5] The New Zealand Aviation Federation was established in 1981. Its memberorganisations represent all General Aviation (GA) sectors, ranging from agriculturaland aerial work service providers to private, sport and recreational aviation, poweredand non-powered. The NZAF's membership also includes model aircraft, remotepiloted aircraft, balloons and parachute operations. "General Aviation" encompasses1 Except to the extent that it revokes an earlier Exemption Notice, issued in 2010."all civil aviation operations other than scheduled air services and non-scheduled airtransport operations for renumeration or hire".2[6] The NZAF's member organisations have a combined membership of more than10,000, of which more than 6,000 are licensed aviators, who represent over 4,000registered aircraft.[7] New Zealand is a signatory to the Convention on International Civil Aviation(the Chicago Convention)3 which sets out the international law framework for civilaviation and establishes the International Civil Aviation Organisation (ICAO). As wellas being a contracting state to the ICAO, New Zealand is also a party to the Tokyo,Hague and Montreal Conventions. The CAA is the government agency that overseesaviation safety and security in New Zealand and sets the rules that underpin that safetyand security. The CAA is the authority in New Zealand that regulates the standardsand recommended practices contained in the ICAO annexes.[8] The Director of Civil Aviation is the chief executive of the CAA and isappointed under s 72I of the Civil Aviation Act 1990 (the Act). Submissions wereadvanced jointly on behalf of the Director and the CAA and for ease of reference Irefer to them collectively as the CAA.Regulation of civil aviation in New Zealand[9] Before I consider the specific issues that arise in this case, it is necessary toprovide some context about the regulation of civil aviation in New Zealand.[10] Both in New Zealand and globally, aviation is highly regulated for safetypurposes. Military and civilian aircraft share New Zealand airspace. TheNew Zealand Defence Force has its own rules and procedures, but these must takeaccount of all civil aviation laws and procedures to ensure that both types of operationscan occur safely in the same airspace.2 Statistics Division of the International Civil Aviation Organisation Review of the Classificationand Definitions Used for Civil Aviation Activities X, STA/10-WP-7 (16 October 2009) at 6.3 Convention on International Civil Aviation 15 UNTS 295 (signed 7 December 1944, entered intoforce 4 April 1947).[11] In the context of civil aviation operations, there is a fundamental distinctionbetween aircraft operating according to Visual Flight Rules (VFR) and those operatingaccording to Instrument Flight Rules (IFR). The details of these rules are set out inthe New Zealand Civil Aviation Rules.[12] Where an aircraft is operating according to VFR, the pilot in command of theaircraft is responsible at all times for operating in visual meteorological conditions(VMC), in which pilots have sufficient visibility to fly the aircraft and maintainseparation from terrain and other aircraft. The pilot must at all times maintain visualreference with the ground or water and maintaining separation from other aircraft –the "see and avoid" rule. Accordingly, the pilot of an aircraft operating according toVFR is not required to be trained to fly solely by reference to instruments. The typicalVFR pilot would therefore quickly lose control of his or her aircraft upon enteringcloud or otherwise losing visual reference with the surrounding terrain.[13] Operations flying according to IFR, on the other hand, must be able to beconducted safely on the basis that the pilot may not have any visual reference with theground or water, from almost immediately after take-off until just prior to landing.IFR flying consequently involves a high degree of initial and ongoing pilot training toensure that pilots are able to maintain control of the aircraft throughout a flight, andnavigate the aircraft safely and correctly in accordance with promulgated routes,entirely by reference to instruments. To this end, a pilot flying according to IFR musthold an Instrument Rating in addition to any flight crew licence, such as a PrivatePilot's Licence, Commercial Pilot's Licence or Airline Transport Pilot's Licence.[14] Where IFR aircraft operations occur in controlled airspace, ensuring adequateseparation between aircraft is the responsibility of Air Traffic Control (ATC). In NewZealand, the Director designates various types of controlled airspace, and the AirwaysCorporation of New Zealand (Airways) provides an air traffic control service for allaircraft in controlled airspace. Airways, which is a state-owned enterprise, is thedesignated Air Navigation Service Provider (ANSP) in New Zealand.[15] All IFR flights must be preceded by the filing of an instrument flight plan toan appropriate Air Traffic Service unit.4 The flight then proceeds according to specific"clearances" to operate on specific tracks at specific altitudes. These clearances aretypically given by way of VHF radio communications between controller and pilot onvarious frequencies, depending on the location and phase of flight. Clearances maybe provided by a ground controller, an on-route controller or an approach controller.[16] Each aircraft operating in controlled airspace is equipped with a secondarysurveillance radar (SSR) transponder which transmits position and identification datafor use by the relevant ATC centre when the aircraft is within SSR coverage. Thisenables the controller to provide a radar-based air traffic separation service. Radarcoverage within New Zealand is sporadic because of the country's mountainousterrain. Some controlled airspace is outside radar coverage; traffic separation in theseareas is therefore provided through procedural techniques using speed, time andreported position.[17] When operating outside controlled airspace, the pilot of an aircraft isresponsible for traffic separation, as aided by traffic information provided by anAir Traffic Service Unit.[18] Therefore, each aircraft – whether in instrument meteorological conditions(IMC) or VMC – operates according to specific procedures for safe navigation. At alltimes an IFR pilot must have a high degree of situational awareness and understandexactly where the aircraft is in space, both laterally and vertically, in order to maintaina minimum distance from terrain and separation from conflicting traffic.[19] In summary, while the air traffic controller has the primary responsibility forseparation between aircraft in controlled airspace, the pilot has primary responsibilityfor traffic separation in uncontrolled airspace, and for the safe navigation of the aircraftat all times. For decades, this was achieved using a system of ground-based navigationaids (GBNA). GBNA are ground-based in the sense that transmitters send signalsfrom a station on the ground. Generally speaking, the signals travel in a line of sight,and therefore require an unobstructed path from the station to the aircraft. However,4 Civil Aviation Rules, 91.407(a).the increasing availability and accuracy of global navigation satellite systems (GNSS)means that GNSS has become the preferred means of aircraft navigation.Move to Global Navigation Satellite Systems[20] A global effort to fully transition from GBNA-based point-to-point navigationto GNSS has been led by the ICAO, which in 1994 mandated a worldwide transitionto satellite navigation systems. The international strategy for this transition is set outin the ICAO's Global Air Navigation Plan (GANP) (2013-2028).5[21] In 1997 Part 19 Subpart D of the CAR introduced regulation of GPSequipment6 for IFR operations in New Zealand and defined primary, sole andsupplemental means of navigation. CAR Subpart 19D requires that primary meansnavigation systems must meet accuracy and integrity requirements, but not continuityof service or availability requirements. Sole means navigation systems must meet allfour requirements.[22] CAR Subpart 19D permits pilots to use GPS as a primary means navigationsystem, provided that the aircraft has an underlying ground-based navigation systemwhich can be reverted to in the event of a loss of GPS navigation capability. GPS istherefore referred to as only a "primary means" of navigation, and not a "sole means"of navigation. CAR 19.209 prohibits the use of GPS as a sole means system for IFRnavigation within the New Zealand domestic flight information region (FIR).[23] CAR Subpart 19D was issued at a time where GNSS operations were relativelynew. It therefore reflects a conservative approach to the use of GNSS operations."New Southern Sky" (NSS)[24] New Zealand's longer-term response to the ICAO's GANP was to initiate aNational Airspace and Air Navigation Plan (NAANP) in June 2014, which wasdeveloped under the name "New Southern Sky" (NSS). One of the streams of work5 Global Air Navigation Plan for CNS/ATM Systems (ICAO Doc 9750-AN/963 (2013).6 GPS is the system of GNSS approved for New Zealand; there is no material difference betweenthe terms 'GPS' and 'GNSS' for the purpose of this case.developed by the NSS is Air Navigation, which is focused on moving from ground-based navigation, which uses radio signal transmitter beacons, to performance-basednavigation (PBN).7 The aim of the plan is to take advantage of the benefits deliveredby GNSS, while minimising the risks posed by the vulnerabilities of the system (whichinclude space weather events with the capacity to render the system inoperative overa wide area, jamming, spoofing, terrain masking, and aircraft system failures). As partof this transition, Airways has removed some GBNAs from certain flight routes.[25] The NSS programme undertook a technical and policy analysis on theimplications of sole means GNSS for New Zealand. The major recommendation ofthe resulting GNSS Sole Means Report (2015) (Sole Means Report) was that:8 GPS sole means navigation does not provide an adequate level of safetywithin the New Zealand FIR. It lacks the ICAO PBN Manual's requirementfor continuity. This creates vulnerabilities, and the New Zealand aviationsystem does not provide sufficient mitigation to these risks without havingaccess to an alternative navigation system.For operations within New Zealand FIR to continue and to remain harmonisedinternationally, this report recommends that New Zealand explores variousoptions for continued navigation in the event of a loss of GPS signals. Thereport explores the dependency of RNAV and RNP operations on GPS andidentifies risks or issues associated with loss of GPS signals. Although thisrisk of signal loss has not been quantified, events show that the risk of aninterference event should not be ignored. Interference can be caused, amongstother things, by jamming, terrain masking, or space weather. It could beintentional or unintentional, and have local, national or international impacts.The options for continued navigation in an interference event could be in theform of a reversion plan to enable continued but limited (and potentiallymodified) PBN, and/or an alternative positioning, navigation and timingsystem to enable continued and seamless PBN.[26] The relevant NSS Working Group, which included Ian Andrews, who is thecurrent president of the NZAF and the principal witness for the NZAF in this case,endorsed the findings of the Sole Means Report. The Report was subsequently peerreviewed by Jeff Cochrane, a global expert on GNSS, who proposed some refinementsbut otherwise endorsed the Report's findings. The Sole Means Report was approvedby the Director of Civil Aviation on 14 December 2015.7 Performance-based rules prescribe a particular outcome, compared to prescriptive rules thatprescribes how something must be done.8 Beth Coughlan and Ray Harvey GNSS Sole Means Recommendation Report (Civil AviationAuthority of New Zealand, 16 November 2015) at 2.[27] The evidence on behalf of the CAA is that, more recently, traditional GPSnavigation has evolved into PBN, which is described in the Executive Summary of theICAO PBN Manual in the following terms:9Performance-based Navigation (PBN)The PBN concept specifies that aircraft RNAV [area navigation] and RNP[required navigation performance] system performance requirements bedefined in terms of the accuracy, integrity, availability, continuity andfunctionality, which are needed for the proposed operations in the context ofa particular airspace concept. The PBN concept represents a shift from sensor-based to performance-based navigation. Performance requirements areidentified in navigation specifications, which also identify the choice ofnavigation sensors and equipment that may be used to meet the performancerequirements. These navigation specifications are defined at a sufficient levelof detail to facilitate global harmonization by providing specificimplementation guidance for States and operators.Under PBN, generic navigation requirements are defined based on operationalrequirements. Operators then evaluate options in respect of availabletechnology and navigation services, which could allow the requirements to bemet. An operator thereby has the opportunity to select a more cost-effectiveoption, rather than a solution being imposed as part of the operationalrequirements. Technology can evolve over time without requiring theoperation itself to be reviewed, as long as the expected performance isprovided by the RNAV system. As part of the future work of ICAO, it isanticipated that other means for meeting the requirements of the navigationspecifications will be evaluated and may be included in the applicablenavigation specifications, as appropriate.PBN offers a number of advantages over the sensor-specific method ofdeveloping airspace and obstacle clearance criteria, i.e.:(a) reduces the need to maintain sensor-specific routes and procedures,and their associated costs;(b) avoids the need for developing sensor-specific operations with eachnew evolution of navigation systems, which would be cost-prohibitive;(c) allows for more efficient use of airspace (route placement, fuelefficiency and noise abatement);(d) clarifies how RNAV systems are used; and(e) facilitates the operational approval process for operators by providinga limited set of navigation specifications intended for global use.9 Performance-based Navigation (PBN) Manual ICAO Doc 9613 AN/937 (2008), at I-(iii)-(iv).[28] In New Zealand GPS is the navigation system that underpins the majority ofPBN operations. The regulation of PBN operations is therefore predicated on the GPSrules.[29] The NSS plan is intended to result in new Civil Aviation Rules based on PBNprinciples. The evidence from Stuart Worden, a principal policy advisor within theCAA, is that the CAA conducted an assessment of existing CARs to identify any areaswhich may impact on the successful transition to PBN in New Zealand. Over 50 ruleor guidance issues were identified that might hinder or obstruct the successfulimplementation of PBN. Of these, four areas were identified where changes to CARswere necessary to address deficiencies of existing rules. Mr Worden's evidence wasthat these changes were combined into a regulatory change package to be progressedby the CAA as a policy project. This package of regulatory change proposals includesrequirements relating to the safe extraction and recovery of aircraft in the event ofPBN system failure and proposes revoking CAR 19.207.[30] In place of CAR 19.207 and the 2020 Exemption, the CAA has proposedintroducing a high-level, performance-based rule requirement with a supportingadvisory circular (AC) setting out acceptable means of compliance with thatrequirement. As Mr Worden notes, a performance-based rule provides the option forother means of compliance to be used where the methods set out in the AC are notappropriate for a given situation.[31] The CAA's expectation is that the new CAR will be signed off by the Ministerof Transport and come into effect sometime in 2021. If and when that happens, theexemption regime under s 37 of the Act would become redundant and the2020 Exemption would be revoked.Legal contextInternational[32] The Chicago Convention sets out the international aviation law framework andestablishes the ICAO.[33] The key provision in the Chicago Convention relevant to this proceeding isArticle 28, which relates to Air Navigation Facilities and Standard Systems. Article28 provides in part:Each contracting State undertakes, so far as it may find practicable, to:(a) Provide, in its territory, airports, radio services, meteorologicalservices and other air navigation facilities to facilitate international airnavigation, in accordance with the standards and practicesrecommended or established from time to time, pursuant to thisConvention;[34] International standards and recommended practices (SARPs) are madepursuant to a law-making function conferred on the ICAO by the Chicago Convention.The SARPs are set out in documents which are referred to as annexes to the ChicagoConvention. There are currently 19 annexes.[35] The annex containing the SARPs relevant to this proceeding is Annex 10Aeronautical Telecommunications Volume 1 (Aeronautical Navigation Aids).[36] The SARPs in the annexes to the Chicago Convention are not binding onmember States, although Article 37 of the Chicago Convention does impose anobligation on every contracting State to " collaborate in securing the highestpracticable degree of uniformity in regulations, standards, procedures andorganisation".[37] In relation to those provisions in the annexes designated as "standards" (asopposed to recommended practices), Article 38 of the Chicago Convention obligesStates to notify the ICAO if the State finds it impracticable to comply in all respectswith any such standard. The ICAO also publishes extensive guidance material to assistStates with their application and implementation of the SARPs.[38] The Chicago Convention itself does not form part of the law of New Zealand.In New Zealand Airline Pilots' Association v Attorney General, Keith J considered indetail the relationship between the Chicago Convention, the rules promulgated underthe ICAO's law-making functions, and New Zealand law, noting that:10The broad point is that some of the provisions of the convention and annexesare appropriate in their subject-matter and drafting for direct application in thelaw of New Zealand, others require detailed national legislation, while stillothers do not call for national legislation at all.[That] does not call into doubt the obligation and the ability of New Zealandto comply with the convention and annexes. Rather, the point is that the givingof full effect to the provisions of those texts in the law of New Zealand isrequired in some cases and not in others, and that, if national legal effect isneeded, the effect might be given more or less directly.[39] I observe at this point that although Mr Andrews says in his evidence thatNew Zealand "does not comply" with rules promulgated by the ICAO in somerelevant respects, the NZAF does not plead any specific breach of ICAO rules. TheNZAF does rely on ICAO guidance material in support of its interpretation of CAR19.207(3), which I discuss at [62] below.New Zealand[40] The hierarchy of New Zealand's aviation safety regulatory system is:(a) the Civil Aviation Act 1990 (the Act);(b) Civil Aviation Regulations (relating to offences and fees);(c) Ordinary civil aviation rules made by the Minister under s 28 of theAct;(d) Emergency CARs made by the Director under s 31 of the Act;(e) Exemptions made by the Director under s 37 of the Act; and(f) Advisory circulars issued by the Director.10 New Zealand Airline Pilots' Association v Attorney General [1997] 3 NZLR 269 (CA) at 285.Civil Aviation Rules (CAR) and the ExemptionsPowers to make rules and exemptions from rules[41] The Minister has power under s 28 of the Act to make rules for a number ofspecified purposes. These are called 'ordinary rules'. The Minister may also makerules relating to safety and security under s 29, to airspace under s 29A, to noiseabatement under s 29B, to general matters under s 30, and emergency rules under s 31.[42] The Governor-General has power under s 34A, by Order in Council on therecommendation of the Minister, to make, amend or revoke any ordinary rule for anyof the purposes for which the Minister may do so under Part 3 of the Act.[43] The procedures relating to ordinary and emergency rules, matters to be takeninto account in making rules, and the procedure for making ordinary rules are set outin ss 32, 33 and 34 respectively. Section 34 requires the Minister, before making anyordinary rule, to publish a notice of his or her intention to do so11 and consult,including with persons and representative groups within the aviation industry.12[44] Under s 37 of the Act the Director has a power of exemption:37 Exemption power of Director(1) The Director may, if he or she considers it appropriate and upon suchconditions as he or she considers appropriate, exempt any person,aircraft, aeronautical product, aerodrome, or aviation related servicefrom any specified requirement in any rule made under section 28,29A, 29B, or 30.(2) Before granting an exemption under subsection (1), the Director shallbe satisfied in the circumstances of each case that—(a) the requirement has been substantially complied with and thatfurther compliance is unnecessary; or(b) the action taken or provision made in respect of the matter towhich the requirement relates is as effective or more effectivethan actual compliance with the requirement; or(c) the prescribed requirements are clearly unreasonable orinappropriate in the particular case; or(d) events have occurred that make the prescribed requirementsunnecessary or inappropriate in the particular case,—11 Civil Aviation Act, s 34(1)(a).12 Section 34(1)(b)(i).and that the risk to safety will not be significantly increased by thegranting of the exemption.(3) The number and nature of exemptions granted under subsection (1)shall be notified as soon as practicable in the Gazette.(4) Nothing in this section shall apply in any case where any rulespecifically provides that no exemptions are to be granted.CAR Subpart D[45] CAR Subpart D is headed "IFR operations: GNSS".[46] "Sole-means navigation system" is defined in CAR 19.203 as:a navigation system approved for a given operation or phase of flight that mustallow the aircraft to meet, for that operation or phase of flight, all fournavigation system performance requirements: accuracy, integrity, availability,and continuity of service[47] In the New Zealand Flight Information Region, a person is not permitted tooperate an aircraft under IFR using GPS as a sole means of navigation. This rule iscaptured in CAR 19.209(a):A person shall not operate an aircraft under IFR using a sole means navigationsystem, which uses only GPS sensors, within the New Zealand FlightInformation Region.[48] "Primary-means navigation system" is defined in CAR 19.201 as:a navigation system approved for a given operation or phase of flight that must meetaccuracy and integrity requirements, but need not meet full availability and continuityof service requirements. Safety is achieved by limiting flights to specific time periods,and through appropriate procedural restrictions:[49] CAR 19.207 permits, with a number of conditions, IFR operations which useGPS as their primary means of navigation. The key such requirement for the currentproceeding is contained in CAR 19.207(3), which provides:19.207 Primary means GPS operationsEach person operating an aircraft under IFR using GPS equipment as aprimary means navigation system shall—(3) ensure, if the aircraft is operating within the New Zealand flightinformation region, that the aircraft is equipped—(i) for air transport operations, with at least 2 operable solemeans navigation systems other than GPS receivers. The solemeans navigation systems must be appropriate for the routebeing flown; and(ii) for operations other than air transport operations, with at least1 operable sole means navigation system other than GPSreceiver. The sole means navigation system must beappropriate for the route being flown; [50] Thus, for air transport operations (operations carrying passengers or goods forhire or reward) using GPS equipment as a primary means navigation system, theaircraft must be equipped with at least two operable sole means navigation systems,other than GPS, that are appropriate for the route being flown; and for operations otherthan air transport operations, the aircraft must be equipped with at least one operablesole means navigation system, other than GPS, that is appropriate for the route beingflown.[51] Essentially, this means that an operator wanting to use GPS as a primary meansof navigation must have conventional (i.e. non-GPS) navigation equipment onboardthat is "appropriate" for the route being flown. What that phrase requires is the centralissue in this case and is discussed later in this judgment.Other CARs relevant to GPS IFR operations[52] Other rules also apply to New Zealand operators conducting air transportoperations using GNSS as a primary means of navigation. These rules relate toredundancy in the event of a system failure. They are separate from butcomplementary to the GPS rules and the 2020 Exemption.[53] CARs 125.353(1)(ii), 121.353(1)(iii), and 135.353(1)(ii) set out therequirement that an aircraft be equipped:with the number of instruments and equipment to ensure that the failure of anyindependent system required for either communication or navigationpurposes, or both, will not result in the inability to communicate and navigatesafely as required for the route being flown;The 2010 Exemption and the 2020 Exemption[54] In 2010, the Director issued an exemption notice under s 37 of the Act (the2010 Exemption) which exempted, with conditions, certain primary means GPSflights from the requirement under CAR 19.207(3) to be equipped with two other solemeans navigation systems. The exemption took the form of Exemption Notice11/EXE/7 dated 1 December 2010, which is set out at Appendix A to this judgment.Since it was issued, the 2010 Exemption has been utilised to facilitate the use of GPSas a primary means of navigation for aircraft in New Zealand.[55] The evidence advanced for the CAA was that the 2010 Exemption wasintended to be an interim measure until new CARs could be made which morecomprehensively dealt with the whole subject of GNSS and replaced the currenttransitional rules in CAR Subpart 19D.[56] On 10 August 2020, the Acting Director of Civil Aviation issued a replacementexemption from CAR 19.207(3), Exemption Notice 11/EXE/7 Revision No. 1, dated10 August 2020 (the 2020 Exemption). The 2020 Exemption is set out at Appendix Bto this judgment.[57] The NZAF initially challenged the validity of the 2010 Exemption. By itsamended statement of claim it now seeks relief in relation to the 2020 Exemption.[58] The CAA acknowledges that there were two deficiencies in the 2010Exemption. First, it did not use the exact words of CAR 19.207(3). Second, it wasdrafted in such a way as to inadvertently exempt operators from both limbs – that is,not only from the "appropriate for the route" requirement, but also (inadvertently) therequirement that operators carry non-GNSS navigation systems.[59] The NZAF's first Statement of Claim reflected these two deficiencies. As itpleaded, in order to be exempt from having onboard the aircraft another sole meansnavigation system in addition to GNSS, operators needed to also be exempted fromCAR 19.209, which provides that a person shall not operate an aircraft under IFR usinga sole-means navigation system which uses only GPS sensors. The 2010 Exemptiondid not, nor did it purport to, exempt operators from CAR 19.209. The NZAF alsocomplained that, in its view, the 2010 Exemption imposed additional operationalrestrictions on operators over and above those contained in CAR Subpart 19D.[60] The 2020 Exemption revoked and replaced the 2010 Exemption.13 Theevidence for the CAA is that the replacement was intended to merely correct thedeficiencies identified at [58] above, rather than fundamentally change the purpose orconditions of the 2010 Exemption.The principal issue – what does CAR 19.207(3) mean?[61] Although this case on its face focuses on the 2010 and 2020 Exemptions, it isin fact a case about the interpretation of CAR 19.207(3). Answering the questionwhat exactly this provision means will therefore resolve a number of the NZAF'sspecific claims relating to the Exemptions from that provision.The NZAF's submission[62] The NZAF says that CAR 19.207(3) "requires no more and no less than thecarriage of the standard ground-based navigation systems"; it concerns only theminimum equipment required onboard an aircraft and is not concerned with how thatequipment is deployed. In support of that argument the NZAF provided a side by sidecomparison between CAR 19.203 and the ICAO provision dealing with the samematters.14 Art 6.26 of that document says "The terminology in 6.24 [referring toprimary means GNSS] applies to the required state of avionics equipage "15Accordingly, the NZAF says, CAR 19.207(3) is satisfied if an aircraft has the full arrayof non-GNSS navigation equipment on board, regardless of whether that equipmentcorresponds to any GBNA on the route flown.[63] The NZAF says that all aircraft operating within the New Zealand FIR do havethe full array of such equipment on board. It therefore takes no issue with therequirement for aircraft operators to carry that equipment.13 I discuss below the reasons for and process involved in the revocation of the 2010 Exemption andsubstitution of the 2020 Exemption.14 Global Air Navigation Plan for CNS/ATM Systems, above n 5, art 6.26.15 Emphasis added.[64] The NZAF's argument instead turns on its understanding of the meaning of thesecond requirement of 19.207(3) (i) and (ii) – that "the sole means navigation systemsmust be appropriate for the route being flown". In its submissions, it said that the"appropriate for the route" requirement "can only mean that an operator cannot replyon NDB equipment if the route relies on a VOR, and vice versa if the VOR systemis unserviceable, the aircraft cannot rely on an NDB system if a VOR approach is partof the route."[65] This entails that CAR 19.207(3) requires the aircraft to be equipped with thenon-GNSS navigation equipment that corresponds to the GBNA available for theparticular route; for example, if NDB (non-directional radio beacon) was the onlyGBNA available on the particular route, it would not be sufficient if the aircraft wasequipped only with VOR (very high frequency (VHF) omnidirectional radio range):the navigation system being carried would not be "appropriate for the route beingflown", and the operation would not comply with CAR 19.207(3). However, thisscenario could only ever be hypothetical, as all operators in New Zealand carryequipment required to fly using both VOR and NDB signals because they carry thefull suite of non-GNSS equipment.[66] While the NZAF acknowledges that aircraft flying air transport operationsmust be equipped with at least two sole means navigation systems that match theGBNA available on a particular route, it says that it is not a requirement that the aircraftbe able to access signals from that GBNA. Carriage of the required navigation systemsis sufficient to meet the requirements of the rule. IFR operators will always haveavailable a sole means of navigation "appropriate" for any routes being flown, as analternative to GPS, whether or not the aircraft can in fact access ground-based signals.If the aircraft is outside the range of ground-based navigation aids in the case of a GPSfailure, its operator can dead reckon to a point where it can receive position or trackinginformation from another IFR navigation source.1616 Dead reckoning refers to the practice of navigation without access to an accurate ongoing positionsource, on the basis that if a starting point is known, data relating to heading, wind, air speed andtime may be used to extrapolate an approximate position at any point.[67] In the NZAF's view, therefore, a primary means GPS flight operator is notrequired to have constant access to a ground-based signal, or fly only routes withunderlying ground-based navigation aids, to comply with CAR 19.207(3). It needonly have the requisite non-GNSS navigation equipment on board.[68] Since, as the NZAF points out, all aircraft used in IRF operations are alreadyequipped with the usual suite of non-GNSS navigation equipment by default, there isno route for which that suite of equipment would be inappropriate. NZAF'sinterpretation would thus render the "appropriate for the route" requirement a nullity.[69] The effect of CAR 19.207(3) as interpreted by the NZAF would be that, beforethe Exemptions were issued, aircraft were permitted to operate using GPS navigationin areas where there are no GBNA, with no additional measures.[70] Based on that interpretation, the NZAF says that the 2020 Exemption imposesadditional conditions on operators using primary means GNSS navigation equipment(namely, that the flight must be planned and fuelled in such a way that it can transitionto an alternative, ground-based, navigation system in the event of GNSS equipment orsignal failure), and prohibits the previously permitted practice of dead reckoning to anearby GBNA route in the event of GNSS navigation failure. It says that the2020 Exemption is thus a de facto, and therefore unlawful, regulation by the Director.It acknowledges that additional restrictions could be imposed by the Director by wayof an emergency rule under s 31 of the Act (if the circumstances in that section aremet) or by the Minister under s 28 of the Act. Each of those rulemaking powers isconditioned by a statutory obligation to consult with the relevant representativegroups.17 No restrictions relevant to this proceeding have been imposed under thosesections.[71] In support of its submission that the 2020 Exemption imposes additionalconditions on operators, the NZAF called evidence about the Exemption's impact onair rescue helicopter services. The NZAF says that helicopters are particularly affectedby the 2020 Exemption because they do not have the same fuel capacity, and hencethe same flight range, as fixed wing aircraft. The conditions in the 2020 Exemption,17 Sections 35(1) and 34(1)(b)(i).particularly condition 5 which requires flights to be "planned and fuelled in such away that if at any time during the flight the GNSS system fails, the aircraft cantransition to an alternative navigation system and if necessary, alternate aerodrome",are therefore particularly detrimental to emergency services which use helicopters.Affidavit evidence, in identical form, was given by Kenneth Franklin, theChief Executive Officer of Helicopter Emergency Services New Zealand Limited, andCraig Gibbons, the Chief Executive Officer of Northern Rescue Helicopter Limited.[72] Mr Franklin and Mr Gibbons expressed their concern that the 2020 Exemptionimposes an additional obligation on operators and pilots which could have the effectof stopping air ambulance IFR missions in certain circumstances. Their evidenceappears to be premised on the same understanding of CAR 19.207(3) as that advancedby the NZAF.[73] Both witnesses refer specifically to what they call "the requirement to carry aGBNA alternative so that an aircraft can navigate to a non-weather-required alternateand use that GBNA to land". They say that this requirement can create two situationswhere they could not undertake their air ambulance missions:(a) first, where the alternate aerodrome is too distant and the aircraft cannotcarry sufficient fuel for the required distance; and(b) second, where the commencing altitude of the approach to an alternateairfield is above the freezing level for that flight (for example, a low-level IFR flight of 1200 feet, between Dunedin hospital and Invercargillhospital, where the approach to Invercargill airport, as the alternate, isat 4,000 feet, often at least 1500 feet above the freezing level).18[74] In conclusion, based on its interpretation of CAR 19.207(3), the NZAF saysthat the Director was acting outside of her statutory powers under s 37 when shepurported to issue the 2020 Exemption. Further, she purported to exercise that powerfor an improper purpose, being the maintenance of what the applicant describes as the18 The freezing level is the lowest altitude in the atmosphere over a given location at which the airtemperature reaches 0ºC."de facto regulatory basis for many aspects of Performance Based Navigation (PBN)regulation".CAA's submission[75] The CAA rejects the NZAF submission that CAR 19.207(3) is concerned onlywith equipage of the aircraft. It contends that CAR 19.207(3) requires two things.First, that the operator must have on the aircraft at least two non-GNSS navigationsystems (for air transport operations) or at least one operable non-GNSS navigationsystem (for other operations) and, second, that ground-based navigation aids mustactually be available on the route being flown. If the second criterion is not met suchthat there is no GBNA coverage available (for instance, no GBNA at the destinationaerodrome) the navigation system being carried by the aircraft will not be "appropriatefor the route being flown".[76] The CAA notes that the ICAO guidance referred to by the NZAF is guidancematerial only and is not binding on New Zealand authorities. Necessarily it must befor each state to draft its own legislation.[77] The CAA's interpretation is fundamentally different to the interpretationadvanced by the NZAF, which contends that the words "appropriate for the route" donot require the non-GNSS equipment on board an aircraft to correspond to GNBA onthat route.[78] The evidence covered the historical reasons for the "appropriate for the route"requirement and the development of technology that led to the issue of the 2010Exemption. Over time the GPS system became more reliable with increasedavailability due to an increase in the number of GPS satellites (GPS receivers requiresignals from a number of satellites in order to fix a position – typically five or six,depending on the type of internal integrity monitoring used). In addition, operators inNew Zealand became more experienced with using GPS navigation. These two factorsmeant that there was a demand for GPS navigation outside the terms of the relevantCAR. The CAA obtained further evidence on the reliability of satellite systemsthrough a safety case conducted by Professor Brian O'Keefe based on the statisticalanalysis of failures of satellite systems and ground-based systems.[79] The development of the 2010 Exemption is explained in the Sole Means Reportin the following terms:19To remain compliant with CAR Part 19D, routes and procedures were initiallydeveloped with underlying ground based navigation aid infrastructure to providecontinuity of service to GPS as primary means. This approach, however, limited thePBN benefits. As PBN was introduced, RNAV/RNP20 routes and procedures offeredthe potential of shorter distances and greater efficiency. As a result, routes andprocedures were developed that deviated from the intent of the rules. They includesectors that do not have underlying ground based NAVAID21 coverage and aretherefore flown with GPS as the sole source of lateral navigation data for IFR flight.(footnotes added)[80] The underlying rationale for the Exemption is that the increased number ofsatellites in the GPS system now provide the necessary technical and legal basis foran exemption, with the remaining risks posed by relying solely on GPS navigationmitigated by the requirement to comply with the conditions set out in the2010 Exemption.[81] As the CAA puts it, the 2010 Exemption was an attempt to recognise theincreased reliability of GPS navigation systems, and provide some relief from therequirements of the rules, but also to put an onus on operators to plan for contingenciesin the event of GPS failure (whether through on-board signal failure or theloss/degradation of the signal). The CAA says that the 2020 Exemption allows forrelief from the requirement in CAR 19.207(3) that an aircraft must remain withinGBNA coverage by imposing conditions that mitigate the associated increase in risk– that is, that the aircraft must be planned and fuelled to be able to recover using a solemeans navigation system (or reversion to VFR) in the event GPS navigation capabilityis lost.[82] The CAA gives, as an example, the routes to Masterton and Wanaka. Prior tothe 2010 Exemption, aircraft could not lawfully operate according to IFR on theseroutes relying only on GPS navigation, because those aerodromes do not haveGBNAs. IFR aircraft operating into Masterton or Wanaka would be equipped with the19 GNSS Sole Means Recommendation Report (above, n 8) at 2.2.1.20 RNAV is area navigation. RNP means required navigation performance.21 NAVAID is navigational aid.usual GBNA receivers, but if the GPS signal is lost there is no GBNA informationbeing transmitted to the aircraft's GBNA receivers. There would therefore be no solemeans navigation system available as a backup to the failed GPS systems. Theevidence for the CAA is that the 2010 and 2020 Exemptions have allowed operationsinto aerodromes such as Masterton and Wanaka. I note that, consistent with itsinterpretation of CAR 19.207(3), the NZAF's position is that the Exemption was notrequired for operations into Wanaka and Masterton because aircraft would be carryingthe full suite of sole means navigations systems, other than GPS receivers.[83] The CAA rejects the NZAF's submission that dead-reckoning would not beallowed under the 2020 Exemption.22 Mr Nicholl, a flight operations inspector for theCAA, says that while dead reckoning is not used as a primary IFR navigationtechnique in New Zealand,23 it can be useful as an emergency measure to transitionfrom one form of navigation to another during a loss of navigation scenario, providedits accuracy limitations are allowed for. By implication, he says, the 2020 Exemption"relies on a well-considered and controlled dead-reckoning segment to be utilised asa contingency measure in a loss of GPS scenario, i.e. when transitioning to a positionfrom which GBNA-based navigation can be resumed."[84] In response to the NZAF's submission on the impact of the Exemption on airrescue helicopter services, the CAA acknowledges that the requirement of the2020 Exemption to stick to routes with GBNA available will mean that air rescuehelicopter services will not be able to carry out some missions, but says that that is fora very good reason. If GPS navigation capability is lost, and there are no GBNAavailable, the aircraft will have lost all navigation aids and would have to revert to adead-reckoning extraction procedure. The requirement to stick to routes with GBNAavailable entails that operators must be able to transport a patient safely, even in theevent of GPS navigation failure.[85] William Smyth, who is employed by the CAA and is Director of the NSS plan,also notes that, contrary to the NZAF's submission, there is no such "requirement" to22 Mr Andrews' evidence says that the CAA and the Director state that "dead reckoning to get to anearby GBNA route is prohibited".23 This form of navigation is subject to increasing errors over time and is therefore of limited use innormal IFR navigation."navigate to a non-weather-required alternate". He says that the GBNA infrastructurethat supports the recovery of aircraft – the Minimum Operational Network (MON) –provides GBNA for exactly the opposite condition: when a GPS outage is experiencedand the weather conditions necessarily require an instrument approach to a GBNA-equipped aerodrome.Discussion[86] It is apparent that this dispute reflects frustration within the aviation industryat the limitations imposed by the CAA on GNSS navigation notwithstanding theinternational and national mandate to transition to satellite navigation systems, at thesame time that some GBNA are being removed by Airways as part of that transition.As Massey Lynch, in his evidence for the CAA, succinctly put it, "what [the] industryexpected to get from GPS navigation and PBN was very significantly more than theactual restricted operations that they are now aware of".24[87] Mr Lynch's view is that most in the aviation industry believe that GNSS is asuperior navigation system compared to conventional navigation systems, and that itshould be authorised for use as a sole means navigation system in New Zealand in thesame way that it is authorised in Australia25 and the United States.26[88] He notes the industry frustration at a situation where a changing navigationstructure – PBN – is being imposed, but with a delay in the associated rulemakingprocesses. Mr Lynch says:Essentially NZ has changed its IFR navigation system to PBN which isenabled by GNSS and therefore by default forced operators to undertakeequipage upgrades and complete considerable operational and approvalprocesses with CAA. While inconvenient, arduous and expensive, thesechanges so far have been achievable by most operators.24 Mr Lynch is the Operations Manager/Captain of Philips Search and Rescue Trust. Mr Lynch'sexperience includes training and examining IFR pilots on both GNSS and conventional FIRnavigation. As a flight examiner, he has trained many pilots in GNSS operations and hasconducted many GPS endorsement assessments.25 Australian Civil Aviation Safety Authority Advisory Circular 91.U-04: Airworthinessrequirements for performance based navigation (11 February 2015).26 United States Federal Aviation Administration Advisory Circular 90-105A: Approval Guidancefor RNP Operations and Barometric Vertical Navigation in the U.S. National Airspace System andin Oceanic and Remote Continental Airspace (7 March 2016).[89] The perception underlying the NZAF's case it is that it is the 2020 Exemption,not CAR 19.207(3), that restricts IFR flights from using GNSS as a sole meansnavigation system. Mr Lynch says, in response, that it is not the Exemption that causesthis issue but the rule itself; the very fact that GPS is not a sole means navigationsystem means that its use comes with the burden of contingency provisioning. Theintroduction of PBN and accompanying restrictions, combined with Airways' removalof some GBNAs, has made IFR operations more restrictive and in some specific casesprevented IFR where it was previously possible.Meaning of CAR 19.207(3)[90] CAR 19.207(3)(i), the provision at issue in this case, has a number of elements.It relates to:(a) air transport operations (operations carrying passengers or goods forhire or rental);(b) operating under IFR;(c) using GPS as the primary means navigation system;(d) within the New Zealand FIR;[91] It requires of such operations that:(a) the aircraft is equipped with at least two operable sole means navigationsystems other than GPS receivers;27 and(b) those sole means navigation systems are appropriate for the route beingflown.[92] The essence of the NZAF's argument is that CAR 19.207(3) relates only to thecarriage of navigation equipment. Under the NZAF's characterisation of the rule, all27 The requirement for air transport operators to carry a minimum of two GNSS receivers is tomitigate the risk of onboard equipment failure, so that the risk is limited to GNSS signal failure orinterference.aircraft used in IFR operations equipped with the usual suite of GBNA receivers willtherefore have on board the sole means navigation equipment "appropriate" for anyroutes being flown, whether or not GBNAs are available to provide signals to thosereceivers on a particular route.[93] That being so, in the NZAF's view, the 2020 Exemption adds nothing in thatrespect, but does impose additional, unnecessary and unauthorised conditions.[94] The NZAF's interpretation conflates the two requirements ofCAR 19.207(3)(i) at [91] above. In my view those two limbs underline that anavigation system entails both:(a) the equipment on board the aircraft; and(b) the associated ground or space-based navigation componentsappropriate to the route.[95] That is consistent with a purposive approach to the provision. I arrive at thatconclusion for the following reasons.[96] First, the NZAF's interpretation of CAR 19.207(3) would make therequirement to carry that equipment largely redundant: there is no point in requiringaircraft operators to carry non-GNSS navigation equipment if they are no longerrequired to fly only on routes where there are GBNA that correspond to that equipmentand it is possible for that equipment to receive signals from those GBNA.[97] The 2020 Exemption is not an exemption from the requirement to carry at leasttwo operable sole means (i.e. non-GNSS) navigation systems. That would beprohibited by CAR 19.209(a), which expressly prohibits the use of GPS as a solemeans navigation system. One of the purposes of the 2020 Exemption was to removethe erroneous wording of the 2010 Exemption which inadvertently suggested thatoperators were exempt from the requirement to carry such equipment. The2020 Exemption is, however, an exemption from the second limb of the rule: therequirement that the non-GNSS sole means navigation equipment be "appropriate" forthe specific route segment.[98] It might be argued, as the NZAF does, that exempting operators from therequirement that the equipment be "appropriate" renders the (retained) requirement tocarry the equipment itself redundant. However, the 2020 Exemption relates to thespecific navigation systems used for the route being flown, not to general equipage.Aircraft are still expected to be able to revert to an alternative navigation system in theevent of GNSS failure – then to fly an approach to land at an alternate aerodrome orusing an alternate approach. This is reflected in condition 5 of the 2020 Exemption,which provides:5. Flights employing GNSS primary means navigation are planned andfuelled in such a way that if at any time during the flight the GNSSsystem fails, the aircraft can transition to an alternative navigationsystem and if necessary, alternate aerodrome;Air transport aircraft require two sole means navigation systems to do this. Therequirement to carry non-GNSS navigation equipment is therefore not redundant eventhough the 2020 Exemption allows operators to fly on routes for which that equipmentis not "appropriate".[99] Second, the NZAF's interpretation of CAR 19.207(3) is not consistent with thesafety objective of the legislative regime, which is:28to establish rules of operation and divisions of responsibility within theNew Zealand aviation system in order to promote aviation safety[100] As detailed at [9]-[19] above, the CAR provide a highly regulated frameworkfor the safe operation of civil aviation in New Zealand.[101] I accept the CAA's submission that if its interpretation of CAR19.207(3) iswrong, then an aircraft could lawfully operate using GPS as a sole means navigationsystem outside areas with GBNA, with no requirement for additional measures. Such28 Civil Aviation Act 1990, long title (a).an interpretation would be at odds with public safety.29 As this Court has previouslysaid, "Where public safety is an issue the Court simply cannot take any risk."30[102] Third, the rule must be read in context, including how IFR routes are designedand promulgated in the New Zealand FIR. Mr Lynch's evidence for the CAA clarifiesthis context. He refers to the New Zealand Enroute IFR Charts (ENRC) whichdescribe the New Zealand domestic IFR route network. As Mr Lynch notes, theseroutes are clearly defined and labelled as Conventional (supported by sole meansNAV Aids) or RNAV 2 (supported by GNSS).31 The routes depicted on these chartsdesignate the type of route and the associated route operating limitations (ROL). Thecharts also depict the navigation aid that is applicable to the route, i.e. VOR, NDB orGNSS. Mr Lynch's view is that the phrase "appropriate for the route being flown" canonly mean the navigation aid(s) defined on the chart as pertaining to the associatedspecific route segment. I agree with that interpretation.[103] I agree with Mr Lynch when he says compliance with CAR 19.207(3) is notpossible if an operator intends to operate on any route segments between waypointsunrelated to a sole means navigation aid (GBNA). Hence the need for the Exemption.[104] I conclude that the words of CAR 19.207(3)(i) impose more than a minimumequipment requirement. Those words require both the carriage of the specifiedequipment and the ability to access the GBNA on the route being flown. If an operatorwishes to fly using GNSS navigation on a route where GBNA is not accessible, it maydo so, provided it (1) carries the specified equipment, and (2) complies with theconditions set out in the 2020 Exemption.Grounds for relief[105] I turn now to the grounds for relief pleaded by the NZAF. These are:(a) illegality – acting outside of statutory powers;29 Support for that view is found in July 2020 correspondence from Air New Zealand Ltd's ChiefOps and Integrity Officer, Captain Morgan, to the CAA, where he highlighted the potential safetyrisks if the Exemption (at that point, the 2010 Exemption) were to be removed.30 International Heliparts NZ Ltd v Director of Civil Aviation [1997] 1 NZLR 230 at 238.31 Aeronautical Information Publication New Zealand Enroute Rules and Procedures 3.2-123.23.(b) illegality – abuse of discretionary powers; and(c) Wednesbury unreasonableness.[106] There is considerable overlap in the detail of each of these broad grounds andI have attempted to identify each specific ground pleaded, as follows:(a) the 2020 Exemption does not "exempt" any person from a specifiedrequirement of a CAR;(b) the 2020 Exemption amounts to de facto regulation of PBN and onlythe Minister is authorised to regulate in that way;(c) the issue of the 2020 Exemption (and associated revocation of the2010 Exemption) was an attempt to avoid the outcome of the NZAF'sinitial claim seeking a declaration that the 2010 Exemption was void;(d) the 2020 Exemption creates a meaningless exemption in order to defeatthe NZAF's pleading;(e) the Director did not consult on the issue of the 2020 Exemption; and(f) the Director had regard to an irrelevant factor in issuing the2020 Exemption; namely, she had regard to this proceeding andrevoked the 2010 Exemption and issued the 2020 Exemption in orderto get rid of the proceeding.[107] Each of these specifics is encompassed under the headings that follow.Did the Director have authority under 37(2)(d) of the Act to issue the Exemption?[108] Section 37 of the Act provides:37 Exemption power of Director(1) The Director may, if he or she considers it appropriate and upon suchconditions as he or she considers appropriate, exempt any person,aircraft, aeronautical product, aerodrome, or aviation related servicefrom any specified requirement in any rule made under section 28,29A, 29B, or 30.(2) Before granting an exemption under subsection (1), the Director shallbe satisfied in the circumstances of each case that—(a) the requirement has been substantially complied with and thatfurther compliance is unnecessary; or(b) the action taken or provision made in respect of the matter towhich the requirement relates is as effective or more effectivethan actual compliance with the requirement; or(c) the prescribed requirements are clearly unreasonable orinappropriate in the particular case; or(d) events have occurred that make the prescribed requirementsunnecessary or inappropriate in the particular case,—and that the risk to safety will not be significantly increased by thegranting of the exemption.[109] As I understand it, the NZAF's argument is that the 2020 Exemption does notfall within s 37 because it does not exempt any person from any specified requirementof any CAR; it adds nothing to what the rule already requires. Rather, it is intendedby the Director to be the de facto basis of regulation for many aspects of performance-based navigation. The NZAF says that the respondents regard the 2020 Exemption asapplicable to all IFR flights using GPS equipment as a primary means navigationsystem, even those complying fully with CAR 19.207(3) to which the exemptionapplies.[110] In response, the CAA says that the 2020 Exemption provides an exemptionfrom the second part of CAR 19.207(3)(i) and (ii) only - that is, the requirement thatthe sole means navigation systems must be "appropriate for the route". It does notexempt an operator from the requirement under the first limb to carry two operablesole means navigation systems other than GPS receivers.[111] Having regard to my finding as to the meaning of CAR 19.207(3) at [104]above and the consequential finding that the 2020 Exemption does not apply to theonboard equipment, but only to the associated ground or space-based navigationcomponents appropriate to the route, I conclude that the 2020 Exemption does exemptoperators from a specified requirement of the CAR (subject to stated conditions) andwas therefore granted within the Director's power under s 37(2)(d).[112] As the CAA submitted, operators are not obliged to rely on the2020 Exemption. They may choose to do so to mitigate the rigour of CAR 19.207(3),in which case the conditions contained in the 2020 Exemption will apply.[113] Since the 2020 Exemption does exempt operators from an identified provisionin the Civil Aviation Rules, it was issued within the Director's power of exemptionunder s 37.The Director imposed conditions on the 2020 Exemption that rendered it whollyineffective[114] The NZAF says that the Director's Exemption power, under s 37 of the Act, isto exempt operators from a specified requirement of a CAR. The 2020 Exemptionimposed a condition (Condition 5) in order to access the exemption from therequirement to carry equipment "appropriate for the route".[115] The NZAF alleges that it is not permissible under either the CARs or theprinciples of good airpersonship to plan, fuel and embark on a flight in reliance on anavigation system that is not appropriate for the route being flown.[116] This appears to be a continuation of the claim made in relation to the2010 Exemption, to the effect that the 2020 Exemption also purports to exemptoperators from both limbs of the provision. Given my finding at [97] above, thisspecific claim must fail.Was the 2020 Exemption issued for the purpose of de facto regulation of PBN?[117] The NZAF pleads that the issue of the 2020 Exemption was an abuse of theDirector's discretionary power, in that she issued the 2020 Exemption for the purposeof maintaining the de facto regulatory basis for many aspects of PBN regulation. Onlythe Minister, or the Governor-General by order in council, may make CAR to regulatePBN.[118] The NZAF puts much weight on a statement by Ryan Nicholl, who is currentlya Flight Operations Inspector with the CAA. In an email from Mr Nicholl toSteve Smyth and others, dated 26 June 2020, Mr Nicholl said "Greg [Baum] hassuggested one possible approach might be to revise 11/EXE/7, which has become thede-facto regulatory basis for many aspects of PBN regulation".[119] For the CAA, Mr Nicholl says he referred to the 2020 Exemption in this waybecause it is the current interim basis on which primary-means GPS navigation andPBN can be facilitated for aircraft operators.[120] I accept that Mr Nicholl used the phrase "de facto regulatory basis" as alayperson, rather than in a technical legal sense.[121] I also accept that the rationale behind the 2020 Exemption is to provide somerelief for operators from the strict requirements of the rules, in a situation where GNSSis becoming increasingly reliable, but where that reliability is not reflected in the1997 CAR, pending new CAR being approved and implemented.[122] Therefore this aspect of the claim of illegality is not made out.Was the 2020 Exemption an abuse of a discretionary power? Was the respondents'conduct of this litigation in bad faith?[123] The NZAF alleges that the issuing of the 2020 Exemption was a deliberateattempt to thwart its proceeding in relation to the 2010 Exemption and that, in effect,the respondents misled the Court when they sought further time to file a statement ofdefence in the proceedings on 10 August 2020. It says that the Director abused herpower under s 37 of the Act by exercising the power to issue an exemption with theintention of defeating the NZAF's proceedings which, as originally filed, challengedthe lawfulness of the 2010 Exemption. The proceedings were not relevant to theexercise of the statutory power.[124] The NZAF filed its statement of claim, seeking a declaration that the2010 Exemption was void and of no effect, on 29 June 2020. The NZAF's objectionis that in the period following filing of the claim the respondents took steps to revokethe 2010 Exemption and replace it with the 2020 Exemption. The Acting Director wasin the process of doing so – and, the NZAF says, fully understood the underlying issues– when, on 10 August 2020, the respondents' counsel told the Court that he had onlylimited instructions at that stage and requested the Court to provide further time forthe respondents to file a statement of defence. At that time, counsel for the CAA didnot disclose to the Court that the revocation and replacement of the 2010 Exemptionwas imminent.[125] The NZAF refers to an email sent by Mr Worden on 8 July 2020 in support ofits submission that the CAA was attempting to delay matters. In that email,Mr Worden said:The timeframe for this work [putting in place a new PBN regulatoryframework, involving removal of 11/EXE/7] is such that we expect 11/EXE/7to be gone within a year, and from my (limited) knowledge of the process Iwould be surprised if a judicial review process could be completed by then, oreven if a judge would agree to progressing it while there was a rule amendmentprocess underway.[126] The CAA's response is, first, that it was only when the CAA's legal advisorsbecame involved that it became apparent that the 2010 Exemption was deficient in thetwo respects identified at [58] above. The NZAF's solicitors had not pointed out thosedefects to the CAA before filing its statement of claim on 29 June 2020.[127] The CAA notes that the 2010 Exemption had been in place for almost 10 yearswhen the NZAF's first statement of claim was filed. Even if successful, the bestoutcome of the proceeding would be revocation of the Exemption a few months beforeits expected revocation and replacement with new CAR. In those circumstances, theCAA and the Acting Director thought it possible and desirable to avoid the need forthe NZAF's claim to go to hearing. The Acting Director declined to meet with theNZAF representatives because the NZAF said if she declined it would be held againsther in relation to costs in the proceeding.[128] I accept that the respondents' lawyers were not aware of the deficiencies in the2010 Exemption until they received the NZAF's statement of claim. I also accept thatthe respondents acted in good faith in moving to rectify the problem and issued the2020 Exemption which corrected the two defects in the 2010 Exemption, in thereasonable expectation that in doing so continuation of the proceeding might beaverted.Was the Director required to consult with the aviation industry before issuing the 2020Exemption?[129] The NZAF says that the Director exercised her powers without priorconsultation, in breach of ss 34 (relating to the making of ordinary rules) and 35(relating to the making of emergency rules) of the Act.[130] Only the Minister32 and the Governor-General33 have the power to make anordinary rule. However, the Director was not making an ordinary rule when she issuedthe 2020 Exemption. Section 35 of the Act gives the Director power to make anemergency rule. Again, I find that she was not purporting to do so.[131] The exemption power of the Director in s 37 of the Act, under which theExemption was issued, does not create a requirement to consult. Therefore the factthat the Director did not consult before issuing the Exception is not a breach of theAct.Was the 2020 Exemption unreasonable?[132] Finally, the NZAF submits that the 2020 Exemption is unreasonable in theWednesbury sense because, it says, the 2020 Exemption is "manifestly incoherent"and inconsistent with the statutory power the Director purported to exercise.34[133] Having regard to my finding as to the meaning of CAR 19.207(3) andconsequentially the ambit of the 2020 Exemption, this claim too must fall away.Result[134] For the reasons set out above, all aspects of the NZAF's claim must fail and Idecline to grant the declaratory relief sought.32 Civil Aviation Act 1990, s 34.33 Section 34A.34 Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1947] EWCA Civ 1.Costs[135] I have found for the respondents on all claims. Costs should follow the event.Gwyn JAppendix A: 2010 Exemption11/EXE/7Exemption from the Requirement in Civil Aviation RuleCAR 19.207 (3)PURSUANT TO Section 37(2)(d) of the Civil Aviation Act 1990,I, Steve Douglas, Director of Civil Aviation, being satisfied that—(a) events have occurred, namely(i) the increase in the number of satellites in the GPS system, and(ii) the increase in experience with use of GPS as a navigationsystem, and(iii) the commissioning of a statistical safety casethat makes the requirement in CAR 19.207(3) that aircraft navigationusing GPS as a primary navigation system are limited to routes thathave an underlying ground based system unnecessary andinappropriate; and(b) the risk to safety will not be significantly increased by the granting ofthis exemption,HEREBY EXEMPT—each person operating an aircraft under IFR using GPS equipmentas a primary means navigation systemFROM—the requirement in Civil Aviation Rule CAR 19.207(3) that each personoperating an aircraft under IFR using GPS equipment as a primary meansnavigation system shall ensure, if the aircraft is operating within theNew Zealand flight information region, the aircraft is equippedi. for air transport operations, with at least 2 operable sole meansnavigation systems other than GPS receivers. The sole meanssystems must be appropriate for the route being flown; andii. for operations other than air transport operations, with at least 1operable sole means navigation system other than GPS receivers. Thesole means systems must be appropriate for the route being flown;ONLY WITH RESPECT TO—operations conducted in aircraft equipped with GNSS receivers approved onthe form 2129 for primary means en-route, terminal, and non-precisionapproach operations,PROVIDED THAT—1. The aircraft is approved for GNSS operations in accordance withCAR 19.207(1); and2. The crew confirms the validity of the navigation data in compliancewith 19.207(5); and3. The GNSS is operated in accordance with the manufacturer'soperating instructions; and4. The flight crew meets the appropriate RNAV (GNSS) qualificationand currency requirements; and5. Flights employing GNSS primary means navigation are planned andfuelled in such a way that if at ay time during the flight the GNSSsystems fails, the aircraft can transition to an alternative navigationsystem and if necessary, alternate aerodrome; and6. In the case of air transport operations,• En-route and terminal operations requiring GNSS may beconducted by aircraft equipped with at leas tone operableGNSS receive, and• Approach operations requiring GNSS may only be conductedby aircraft equipped with at least two operable GNSSreceivers; and• The diversion procedures must be promulgated in theoperator's route guide or similar, and accepted by the CAAbefore the GNSS instrument flight procedure is used.This exemption shall remain in effect unless withdrawn in writing by the Director.SIGNED at Petone ))This 1st day of December 2010 )) _____________________________By Steve Douglas ))Director of Civil Aviation )Appendix B: 2020 Exemption11/EXE/7REVISION NO. 1Exemption from the Requirement in Civil Aviation RuleCAR 19.207 (3)PURSUANT TO Section 37(2)(d) of the Civil Aviation Act 1990,I, Shelly Turner, Acting Director of Civil Aviation, being satisfied that—(a) events occurred, namely(i) the increase in the number of satellites in the GPS system, and(ii) the increase in experience with the use of GPS as a navigationsystem, and(iii) the commissioning of a statistical safety casethat makes the requirement in CAR 19.207(3) that aircraft navigationusing GPS as a primary navigation system are limited to routes thathave sole means navigation systems other than the GPS receivers orreceiver appropriate for the route being flown unnecessary andinappropriate; and(b) the risk to safety will not be significantly increased by the granting ofthis exemption,HEREBY EXEMPT—each person operating an aircraft under IFR using GPS equipmentas a primary means navigation systemFROM—the requirement in Civil Aviation Rule CAR 19.207(3) that the sole meansnavigation systems referred to in subparagraphs (i) and (ii) must be appropriatefor the route being flown;ONLY WITH RESPECT TO—operations conducted in aircraft equipped with GNSS receivers approved onthe form 2129 for primary means en-route, terminal, and non-precisionapproach operations,PROVIDED THAT—1. The aircraft is approved for GNSS operations in accordance withCAR 19.207(1); and2. The crew confirms the validity of the navigation data in compliance with19.207(5); and3. The GNSS is operated in accordance with the manufacturer's operatinginstructions; and4. The flight crew meets the appropriate RNAV (GNSS) qualification andcurrency requirements; and5. Flights employing GNSS primary means navigation are planned and fuelledin such a way that if at any time during the flight the GNSS system fails, theaircraft can transition to an alternative navigation system and if necessary,alternate aerodrome; and6. In the case of air transport operations,• En-route and terminal operations requiring GNSS may beconducted by aircraft equipped with at least one operable GNSSreceiver; and• Approach operations requiring GNSS may only be conducted byaircraft equipped with at least two operable GNSS receivers; and• The diversion procedures must be promulgated in the operator'sroute guide or similar, and accepted by the CAA before the GNSSinstrument flight procedure is used.This exemption revokes and replaces 11/EXE/7 dated 1 December 2010 and shallremain in effect unless withdrawn in writing by the Director.SIGNED at Wellington ))This 10th day of August 2020 )) _____________________________By Shelley Turner ))Acting Director of Civil Aviation )