A water project championed by Conservative cabinet minister Gary Lunn has been defeated, according to members of the neighbourhood association that opposed the expansion.

Lunn delivered a $1.1-million federal grant for the project which would have extended water service to 64 high-end homes on Senanus Drive, The Tyee reported in 2008.

“Water issues in this community should and can be resolved without piping in water where the Official Community Plan discourages extension of such services,” said Mount Newton Neighbourhood Association board member Chris Paynter in an emailed statement. “The preservation of the rural character of Mount Newton valley is of vital concern to the MNNA. ”

Paynter also noted that the Central Saanich homes are outside the urban containment boundary.

Central Saanich is repealing the bylaw that allowed for the expansion and has agreed to pay for the MNNA's legal costs in exchange for the group dropping its court challenge, the statement said.

“It shouldn't be necessary for citizens to take their municipality to court in order to ensure that laws are followed, and citizens are treated fairly,” said MNNA board member Bob Bocking.

Lawyer Irene Faulkner acted for the MNNA on the challenge. The suit alleged several legal problems with how Central Saanich enacted its bylaw, including that “false and misleading” information had been used to collect signatures for a petition supporting the bylaw.

“Decisions about municipal infrastructure have a huge impact on how communities develop,” said Andrew Gage, the acting executive director of West Coast Environmental Law, which partially funded the MNNA's challenge. “To avoid legal challenges, local governments need to make these important decisions in ways that follow the law and are transparent and accountable.”

The Environmental Law Centre at the University of Victoria also supported the neighbourhood association's legal challenge.

Andrew MacLeod is The Tyee’s Legislative Bureau Chief in Victoria. Reach him here.