The approval of a waste incinerator near Belfast "side-stepped" legal requirements for collective decision-making at Stormont, a court has heard.
Planning permission for the £240m facility was approved by a Department for Infrastructure civil servant in September 2017.
In May, the High Court held that he had unlawfully authorised the planned incinerator.
Lawyers for the department are appealing that verdict.
Following two days of legal arguments at the Court of Appeal, Lord Chief Justice Sir Declan Morgan, sitting with lord justices Stephens and Treacy, reserved judgment in the appeal.
Counsel for opponents of the facility at Hightown Quarry in Mallusk had argued it was so significant and controversial that it cut across departmental boundaries at Stormont.
Lawyers for the Department for Infrastructure have been trying to provide clarity over civil servants' powers to govern following the collapse of devolution.
They contend that Parliament anticipated periods of hiatus where Northern Ireland would have to be run without a functioning executive in place.
The 1998 Northern Ireland Act provided a unique legal right for departmental functions to continue while ministers are not in post, the court was told.
However, David Scoffield QC, representing objectors to the waste facility, insisted it cut across into the Department of Agriculture, Environment and Rural Affairs responsibilities.
On that basis, he argued, there was a legislative requirement to bring the issue before the Northern Ireland Executive, rather than go on a "solo run".
"It's impermissible for a department, just as much as a minister, to side-step a requirement for collective decision-making in such a case," Mr Scoffield said.
"That is plainly inconsistent with the statutory scheme."
His client, Colin Buick, chairperson of community group NoArc21, won the original court battle amid claims the incinerator was wrongly approved with the required direction and control of a minister.
The scheme had originally been turned down in 2015 by the then environment minister, Mark H Durkan.
But a consortium behind the project on behalf of six local councils, Arc21, was given permission after the Planning Appeals Commission recommended approval.
In September last year, the department said it was in the public interest for the waste management system to be built, describing it as being of strategic importance for the region.
The decision came months after the Stormont Executive fell in early 2017.
Up to 4,000 letters objecting to the incinerator were lodged, with residents listing concerns about the visual impact, light and noise pollution and health implications.
The department's legal team is now attempting to have the High Court ruling overturned on the basis that Northern Ireland's unique constitutional arrangements have enabled powers to continue being discharged in the absence of ministers.
Following two days of legal arguments Lord Chief Justice Sir Declan Morgan, sitting with Lord Justices Stephens and Treacy, reserved judgment in the appeal.