The Cancer Society of New Zealand has successfully reviewed a decision by the Ministry of Health that smoking is permitted in Sky City's Diamond Lounge. The Court considered that the Ministry applied the incorrect test when finding that the Lounge was an "open area" under the Smoke-Free Environment Act 1990. The Ministry must now reconsider the Society's complaint in accordance with the provisions of the Act.

Under the Act, smoking is permitted in "open areas" of a casino.  Whether a space is an "open" or "internal" area is defined by reference to the physical characteristics of the space, in particular whether or not is enclosed or substantially enclosed. The Ministry developed an "Open Areas Calculator" to assist its enforcement officers with determining whether an area was "substantially enclosed" or an "open area". This calculator was relied on by the enforcement officers who decided that the Diamond Lounge, developed by Sky City for use by patrons who smoke, was an "open area" under the Act. This was successfully challenged by the Cancer Society of New Zealand, with the Court finding that the Open Areas Calculator produced an inflexible standard which fettered the decision-making power under the Act and introduced air quality as a factor to be considered contrary to the clear scheme and purpose of the Act. The Court made a declaration to this effect, and directed reconsideration of the Society's complaint. Following this decision, Sky City has made the Diamond Lounge a non-smoking area. Cancer Society of New Zealand Inc & Ors v Ministry of Health & Ors [2013] NZHC 2538