In a move hailed by environmentalists as a landmark decision, the Hawai'i Supreme Court has ruled that city and county governments have a duty to protect coastal waters.

The high court's decision relates to the Hokuli'a resort development south of Kailua, Kona, on the Big Island and muddy storm runoff from the construction site during storms in 2000.

In a 60-page unanimous opinion issued Friday, the court found that Hawai'i County and the state Department of Health are under a public-trust doctrine mandated by the state Constitution to protect coastal waters.

The court rejected the claim that the county government did not fall under that mandate.

However, the justices said they found that neither Hawai'i County nor the state violated that trust in the handling and monitoring of the development.

Still, the pronouncement that Big Island county is under an "affirmative duty" to protect the waters drew praise from lawyers representing environmental and Native Hawaiian groups.

Although the decision directly involves Hawai'i County, it also applies to the city and county of Honolulu and other Neighbor Island counties.

Robert D. S. Kim, a Big Island lawyer, represents Protect Keopuka 'Ohana, a nonprofit coalition of Native Hawaiian cultural practitioners and environmental advocates who sued the state and Hawai'i County. He called the ruling a "landmark" decision that strengthens the protections of state natural resources.

He said the decision places a duty on Hawai'i County to "ensure that conditions designed for effective soil erosion control are being met by a land developer."

Alan Murakami, lawyer for the Native Hawaiian Legal Corp., which also represented the coalition on appeal, said the counties from now on cannot be so "cavalier" in claiming it is the state's responsibility, not the counties', to protect the waters.

David Kimo Frankel, lawyer for the Sierra Club, which filed a brief in support of Protect Keopuka 'Ohana, said the impact of the ruling is that a "government agency, county or the state has to diligently investigate, monitor and enforce (water laws and regulations) to ensure water quality is protected."

If the agency doesn't have the resources to fulfill that obligation, it shouldn't issue permits for development, he said.

Ivan Torigoe, Big Island deputy corporation counsel, said the decision essentially places "affirmative public-trust duties to protect natural resources" on the county. "We will have to review those duties with the appropriate agencies to try to make sure we're in compliance," he said.

As to how it might affect future developments, he said his office would have to "discuss with our agencies to see what is practicable to do." But Torigoe said the county was "glad that the court found there was no breach of public trust proven."

Deputy Attorney General Adina Kobayashi Cunningham also expressed happiness that the state was not found liable for any breach. She said the decision will be reviewed to see if the state must do anything differently in the future.

The high court's opinion, written by Associate Justice Simeon Acoba, affirmed Big Island Circuit Judge Ronald Ibarra's 2002 decision that said the state and county had a duty to protect the ocean waters off the Hokuli'a site. But the high court reversed his ruling that they had violated their duties.

Acoba's decision said the state constitution is clear when it says "the state and its political subdivisions shall conserve and protect Hawai'i's natural beauty and all natural resources."

The high court agreed with Protect Keopuka 'Ohana, which argued that the county is a "political subdivision" of the state, so the public-trust doctrine applies.

The lawsuit over the storm runoff was later expanded to include a challenge alleging that the project was an illegal use of agricultural lands. Ibarra halted construction in 2003 but lifted his injunction this year after a settlement was reached.

Also earlier this year, the Hokuli'a developer agreed with the state Department of Health to a proposed settlement and to pay a $200,000 fine involving the 2002 storm runoff. Under the terms, $150,000 would go to repair loading docks at boat-launch ramps at Keauhou Boat Harbor and $50,000 would go to the state Environmental Response Revolving Fund.

The high court's decision ends the litigation challenging the project.

Reach Ken Kobayashi at kkobayashi@honoluluadvertiser.com.