Facts
The appellants (heirs of [A.A.] ) are the owners of the villa "Schlössli" on parcel No. 659 in Walenstadt, which borders directly on the construction site No. 661 of the respondent ([D. AG] ). Since 2009, Walenstadt has been listed as a small town/town of national importance in the Federal Inventory of Sites and Monuments of National Significance in Switzerland (ISOS). Construction site No. 661 is partially located in the building group 0.4 (conservation objective B) and partially in the surrounding area IV (conservation objective a), while the adjacent villa "Schlössli" is recorded in building group 0.4 with conservation objective A.
The respondent applied on 6 July 2017 for the demolition of the existing single-family house and garage and for the construction of two multi-family houses with underground parking. The appellants filed an objection against the project. The municipal council of Walenstadt granted the building permit on 13 May 2019, which was confirmed by the cantonal building department on 22 January 2021 in the appeal procedure. The Administrative Court of the Canton of St. Gallen dismissed the appeal by the heirs on 17 March 2022. The appellants filed an appeal with the Federal Supreme Court on 9 May 2022 against this decision.
In the proceedings before the Federal Supreme Court, the suspensive effect of the appeal was granted. The respondent requested the dismissal of the appeal, while the Federal Office of Culture (FOC) criticised an incomplete consideration of the protection of the site. In February 2023, the appellants concluded a protection agreement for the villa "Schlössli", which was challenged by the respondent. The Federal Office for the Environment (FOEN) commented on the obligation to obtain a permit under water protection law.
Considerations
The Federal Supreme Court first examines the admissibility of the appeal. It admits the appeal because the appellants, as owners of the adjacent villa "Schlössli", are entitled to file an appeal (Art. 89 para. 1 FSCA) and the appeal was filed within the statutory time limit (Art. 100 para. 1 FSCA). The appeal alleges a violation of federal law, in particular the incorrect application of the ISOS and the denial of a federal task in water protection.
The Federal Supreme Court finds that, although the ISOS, as a federal inventory, aims to preserve objects of national importance without restriction (Art. 5 para. 1 NCHA), it is only directly applicable when federal tasks are being fulfilled (Art. 78 para. 2 Cst., Art. 6 para. 2 NCHA). Where no federal task exists, the protection of sites falls within the competence of cantonal law. The appellants only allege the incorrect denial of a federal task, not the indirect consideration of the ISOS within the framework of cantonal planning. Therefore, the Federal Supreme Court cannot review the indirect application of the ISOS (Art. 106 para. 2 FSCA).
With regard to the question of a federal task in water protection, the Federal Supreme Court states that such a task only exists if the challenged decision concerns a matter regulated by federal law that has a connection to the protection of nature, landscape or homeland. The water protection permit granted by the Canton of St. Gallen is based on cantonal law (Art.…