The West Australian government has begun a legal fight to reverse a decision that slapped down its environmental watchdog, potentially derailing a key part of the $1.9 billion Perth Freight Link project.
Political momentum has been mounting to build the project, with Prime Minister Malcolm Turnbull recently announcing the commonwealth contribution had risen to 63 per cent.
That came despite the Supreme Court of WA Chief Justice Wayne Martin ruling last year that the Environmental Protection Authority "took no account of its own published policies" when it approved the first stage of the project, known as Roe 8, but it was legally obliged to.
Chief Justice Martin accordingly ruled the approval invalid, forcing the EPA to go back to the drawing board.
The Perth Freight Link aims to divert heavy trucks onto a direct route to Fremantle Port and will be the state's first toll road, but conservationists are up in arms as Roe 8 will cut through the environmentally-sensitive Beeliar wetlands.
In the Court of Appeal on Monday, state counsel for WA George Tannin argued the EPA Act did not expressly require the watchdog's policies to be treated as mandatory considerations.
"These polices are not essential to the operation of the statutory scheme," Mr Tannin said.
"They are nothing more than guidelines."
However, lawyer Matthew Howard, who represents the Save Beeliar Wetlands group, told the court that for the EPA to comply with the Act, certain critical environmental assets must be protected and conserved.
Mr Howard noted the Beeliar wetlands were in the highest priority conservation category, and clearing them threatened habitats for species including the endangered Carnaby's black cockatoo and southern brown bandicoot.
"For the EPA to do its job, critical assets must be protected and conserved," he said.
"We contend where the EPA has told the world `this is how we are going to do it' ... to then depart from those (policies) without a word as to why is not a reasonable process.
"The EPA is there to give advice to the minister, and the minister can always make a political decision."
Save Beeliar Wetlands convenor Kate Kelly told reporters outside court the EPA didn't truly ask itself if the project was environmentally acceptable or not because it was operating under a "robust" state government.
"The public needs to have trust that the EPA is the best it can be. It needs to be an independent, expert authority," Ms Kelly said.
The Court of Appeal will hand down its decision at later date.