Chief Executive of the Ministry of Social Development v Holmes

[2013] NZHC 672

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

CIV-2012-412-000741 [2013] NZHC 672

UNDER  the Privacy Act 1993

IN THE MATTER OF     an appeal from the Human Rights Review

Tribunal

BETWEEN  CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT

Appellant

ANDGORDON HENRY HOLMES Respondent

Hearing:         18 and 19 February 2013

Appearances: J Holden and T Bromwich for the Appellant

Respondent in Person
L Andersen as Amicus Curiae
J M Ryan for Director of Human Rights Proceedings

Judgment:      8 April 2013

RESERVED JUDGMENT OF THE COURT FOGARTY J, G J COOK JP AND THE HON K L SHIRLEY

CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT V HOLMES HC DUN CIV-2012-

412-000741 [8 April 2013]

Table of Contents

Introduction ............................................................................................................[1] Structure of this judgment ......................................................................................[7] This Court on appeal ..............................................................................................[8] Narrative of the facts ............................................................................................[13] Application of the provisions of the Privacy Act 1993 ........................................[42] Whether or not there was a decision under s 40, to refuse information, requested

on 22 August 2010 ...............................................................................................[53] Second head of liability – the later refusal to supply the TAS information as requested on 4 October.........................................................................................[82] The finding that the Tribunal erred in finding that MSD/WINZ’s breaches were “sustained and systemic”......................................................................................[84] Did the Tribunal have the jurisdiction to order MSD/WINZ to carry out a review

of the Ministry’s processes for ensuring compliance with the Privacy Act? .......[98] Did the Tribunal err in awarding damages of $17,000? .....................................[102] Appeal on award of damages .............................................................................[103] Procedural point ................................................................................................[103] Whether the damages of $10,000 and $7,000 were excessive ...........................[109] Conclusion and summary ...................................................................................[156] Result ..................................................................................................................[162]

Other orders .......................................................................................................[163]

Introduction

[1]      Mr Holmes is in receipt of an unemployment benefit, and has been since September 1999.   The Human Rights Review Tribunal described his relationship with  the  Ministry  of  Social  Development  (MSD)  and  Work  and  Income  New Zealand (WINZ) as an unhappy one, and commented that he is, in some respects, an eccentric, but he is an honest and upright individual who has a strong sense of what is right and what is wrong.  His written communications with the Dunedin Central Office of WINZ  are typically prefaced with complaints about how badly he has been treated by them.

[2]      On 13 October 2009, he sought the assistance of  WINZ to pay the cost of

$70 for an eye test, in order to maintain his driving licence.  WINZ sent a letter to him advising of a $70 advance to be repaid at $3 per week, starting 22 October 2009. Although the letter did not spell it out, it meant there would be a final payment of $1 due on 1 April 2010.

[3]      The terms of this advance are at the root of the decision of the Tribunal1 under appeal in this case.  For WINZ intended this to be a refundable allowance, and Mr Holmes wanted it to be non-refundable.  An officer of WINZ, Mr Rakiraki, had discussed the prospect of $20 worth being non-refundable.   From 2009 onwards, there was an ongoing dispute between WINZ and Mr Holmes on the subject, known by them both as TAS (an acronym for Temporary Additional Support).  Mr Holmes must have appreciated that it takes 23 weeks of $3 payments to repay $69, with a further $1 to pay the balance.  This period essentially ended about 1 April.  This was the date of the annual general increase.  Unbeknown to Mr Holmes, an officer of WINZ decided to apply the $3 per week, after repayment of the $70 advance, to the balance of a separate advance of $44 to a driving licence, which hitherto had been paid off at $1 per week.  It was not until 19 May that that advance was paid, ending

deductions for advances and enabling the annual increase of $3.73 to emerge.

1      Holmes v Ministry of Social Development [2012] NZHRRT 19.

[4]      On 22 August, in the course of ongoing correspondence about the question of whether or not the $70 should have been non-refundable (the TAS dispute) Mr Holmes wrote:

2.     I ask you to review the decision to deny me my increase April 1st

2010 until I started making inquiries in regard to this matter...

3.     Please supply all letters of correspondence in relation to this denial...

[5]      That request and the ensuing responses of WINZ became the subject of an application under the Privacy Act 1993 to the Human Rights Review Tribunal for damages, being a claim of breach by WINZ on two occasions of its obligation under that Act to provide all relevant personal information on its files within 20 days of a request.   This being a right protected in the Privacy Act by Principle 6 (access to

personal  information)2   and  an  obligation  to  supply  the  information  within  20

working days.3   The Tribunal found breach in two respects and awarded damages of

$10,000 and $7,000, totalling $17,000 together with a lump sum of $300 for stationery, postage, copying and related expenses of Mr Holmes.

[6]      The Chief Executive for the Ministry of Social Development, responsible for WINZ, appeals.  Mr Holmes, appearing for himself, defends the decision.  He was supported as to the amount of damages by counsel for the Director of Human Rights Proceedings.  The Court appointed Mr L Andersen as an amicus curiae.  This was because of the limited opposition by the Director of Human Rights Proceedings to the appeal by MSD.  Mr Andersen was not given any directions by the Court, and helpfully gave submissions as amicus curiae, including making the argument for Mr Holmes on issues where Mr Andersen judged Mr Holmes would not have the ability to make the argument.

Structure of this judgment

[7]      This judgment is long.  We think that is unavoidable.  One of the reasons for its  length  is  that  we  have  a  different  perspective,  including  different  material

interpretations of relevant provisions of the Privacy Act, which was the Act being

2      Section 6.

3      Section 40(1).

applied in this case to have found the awards of damages.    The structure of the reasoning of this judgment is as follows:

(a)      This Court on Appeal

Under this heading, we examine to what extent this Court, sitting on appeal, can fully review the decision of the Human Rights Review Tribunal.  As to whether or not there was any breach of the Privacy Act, we consider there is a full right of appeal.  As to the amount of damages, we consider that is an exercise of discretion, and we have a more limited role, so that we can only intervene for error of principle, or because the decision is plainly wrong.

(b)      Narrative of facts

Under  this  heading,  we  have  set  out  at  some  length  the correspondence that was passing between WINZ and Mr Holmes.  We have included all relevant correspondence at the time, including correspondence  on  matters  unrelated  to  the  two  letters   which generated the findings of liability.   We do that deliberately, as we think it is important to see those letters in context.

(c)       Application of the provisions of the Privacy Act

We then turn to study more closely just what is required of WINZ by the Privacy Act.  We focus on the Privacy Act being a statute designed to enable individuals to obtain information collected about them.  We distinguish this from requests for explanations for reasons why decisions have or have not been taken.

Having laid out the facts and considered the important provisions of the Privacy Act, we then turn to specific issues which underpin the two findings of liabilities.  We focus on the first finding of liability arising from  the letter  of 22 August  of Mr Holmes.   We do  this

because  the  second  letter,  which  founded  the  second  order  for damages, is agreed to have been a request for information which was not answered in time.  That topic is under the heading “Whether or not  there  was  a  decision  under  s 40,  to  refuse  information, requested on 22 August 2010.

Having  analysed  the material  and  concluded that  there was  not  a

refusal, we reverse the Tribunal’s decisions on liability.

(d)      Second Head of Liability

We then briefly record that this head of liability is not disputed, but that there was an apology.

(e)       The finding that the Tribunal erred in finding that MSD/WINZ

breaches were sustained and systemic

We examine this issue as the Tribunal’s finding to this effect underpinned the level of damages that it awarded.  After analysis, we reject this finding.

(f)      Did the Tribunal have the jurisdiction to order MSD/WINZ to carry out a review of the Ministry’s processes for ensuring compliance with the Privacy Act?

We examine this topic because the Tribunal ordered a nationwide review. We conclude that the Tribunal does not have this power.

(g)      Did the Tribunal err in awarding damages?

Because we find that the first ground of liability is not made out, it follows that we do not think the damage award of $10,000 can stand. However, we analyse damages anyway, in the event that we are wrong about  there being  no  liability on  the part  of WINZ’s  response  to Mr Holmes’s letter of 22 August.

This section of the judgment on damages breaks down into a number of points.

(h)       Procedural point

We begin by considering the procedural point as to whether or not the Tribunal was confined by the damages that Mr Holmes sought in his application. We answer that question “no”.

Then we go on to consider the levels of damages.  Keep in mind that we examine the first award of $10,000 against the possibility that we are wrong in rejecting liability.   We examine the second award of

$7,000 on the basis that liability was admitted.  We come to the conclusion that both awards were too high.  We think that was in part because of some errors of law.  We do not allow the first award at all, because we found there was no liability, and we reduce the second award from $7,000 down to $2,000.

At the end of the judgment we have a conclusion and summary which endeavours to capture the material facts and the conclusions of the judgment.

This Court on appeal

[8]      Complaints  under the Privacy Act  can  be subject  to  examination  by the Privacy  Commissioner  and  to  proceedings  before  the  Human  Rights  Review Tribunal.  Mr Holmes, as an aggrieved individual, brought proceedings before the Tribunal under s 83 of the Act.  Section 89 of the Privacy Act provides that certain provisions of the Human Rights Act 1993 apply in respect to proceedings under s 83. They include Part 4 of the Human Rights Act, which provides for a right of appeal to the High Court in s 123. This is a right of general appeal.  Section 123 provides:

123       Appeals to High Court

...

(5)       In determining any appeal under this section the High Court shall have the powers conferred on the Tribunal by sections 105 and 106 of this Act,  and  those  sections  shall  apply  accordingly  with  such modifications as are necessary.

(6)      In its determination of any appeal, the Court may—

(a)     Confirm,  modify,  or  reverse  the  order  or  decision  appealed against, or any part of that order or decision:

(b)     Exercise any of the powers that could have been exercised by the Tribunal in the proceedings to which the appeal relates.

(7)     Notwithstanding anything in subsection (6) of this section, the Court may in any case, instead of determining any appeal, refer to the Tribunal, in accordance with the rules of Court, for further consideration by the Tribunal, the whole or any part of the matter to which the appeal relates.

[9]      Section 126 of the Human Rights Act provides for additional members for the purpose  of  such  an  appeal.    Accordingly,  this  Court  sits  with  two  additional members.  The two additional members of this Court, Messrs G J Cook JP and Hon K L Shirley, have considerable experience as past and present members of the Tribunal.

[10]     Counsel agreed that as to the question of any breach there is a full right of appeal, to be guided by the Supreme Court decision in Austin, Nichols & Co v Stichting Lodestar.4    In respect of damages, Mr Andersen submitted that that being an exercise of discretion, the Court should be guided by the decision of May v May,5 so that the award should not be overturned unless it can be demonstrated that the

lower Court made an error of principle, considered irrelevant matters, failed to consider relevant matters or is plainly wrong.  There is divided case law in the High Court as to whether the May v May limitations apply where there is a right of general appeal.

[11]     We have proceeded with the analysis on the basis that we first follow the

Supreme Court in Austin, Nichols, so that the appellant bears the onus of satisfying

4      Austin, Nichols & Co v Stichting Lodestar [2007] NZSC 103.

5      May v May [1982] 1 NZLR 165 (CA).

this Court that it should differ from the decision under appeal, and only if this Court considers the appeal decision is wrong is it justified in interfering with it.6    In this case, this Court takes into account that the two additional members of the Court have experience and expertise in these sorts of issues.  This is a general appeal and, accordingly, this Court has a responsibility of arriving at its own assessment of the merits of the case.7

[12]     For the reasons which become apparent, we do not find it necessary to decide if those responsibilities are confined when we come to the question of damages by the May v May criteria.

Narrative of the facts

[13]     On 5 January 2010, Mr Holmes asked WINZ to review the TAS decision of

13 October 2009; see [2] above.  After a large number of complaints about the way he was treated at that time, he said that he was never told how much would be deducted, or when.   Some of the flavour of the letter can be appreciated by the closing remarks:

...She told me to fill out rest of form for extra benefit.  When I told her I couldn’t as I didn’t have my mag [magnifying] glass with me, she stated that’s your problem then, the forms were not given to me to take away when I asked for them to do this, she said you had your chance and took them away.   I was never told how much would be deducted or when, by this person.

I was belittled and humiliated by her but am not surprised in view of continuing  treatment  against  myself  by  WINZ  and  other  agencies  in collusion with WINZ.

[14]     That letter was acknowledged by a WINZ reply on 11 January 2010.  It being interpreted (correctly we think) as an application for a review of the WINZ decision to pay for the eye test by means of an advance, rather than by means of a non- recoverable payment.   (The $70 was paid directly to the optometrist in October

2009.)

6      Austin, Nichols & Co v Stichting Lodestar [2007] NZSC 103 at [4].

7 At [5].

[15]     On 5 February 2010, WINZ wrote to Mr Holmes, saying they had completed an internal review and considered the original decision (an advance only) to be correct.  The consequence of this review was that his application would continue to the Benefits Review Committee for a hearing.  That took place on 25 March 2010. There were no appearances made.  The Committee agreed to uphold the original decision.

[16]    Mr Holmes decided to appeal this decision to the Social Security Appeal Authority (SSAA), and did so in June of 2010.  This letter is full of complaints as well, about how he had been treated, made the subject of “lies and deceit”, and “suffered further threats and intimidation”.

[17]     On 1 April 2010, his unemployment benefit rate was adjusted by application of the Annual General Adjustment.  In this year, for Mr Holmes, this was an increase of $3.73 per week.

[18]     Unbeknown to Mr Holmes, or the branch manager of the Dunedin Central office of WINZ, Mrs Dixon, an internal decision was made within WINZ to transfer the deduction of $3 per week agreed (imposed) in October 2009 to complete repayment of a $44 advance to pay for a driving licence.  So that it was not until 19

May that the deductions ceased.

[19]     On 27 July 2010, Mr Holmes wrote to WINZ asking for a review of the decision to “intentionally deny me extra help of benefit, namely, TAS on 13/10/09”. (This is the same matter which had already been reviewed, and in respect of which he had appealed to the SSAA.)  In his letter, he complains about failure of the SSAA to respond.  In the letter he says:

This request for review is now of course, out of time request, due to failure from WINZ and SSAA to respond/reply, both to my letters of 5/1/10 and to which I have no response over its content and review committee who failed to address the issue and now SSAA who failed to respond to my questions in letter dated 14/6/10 over this matter.

[20]     On 8 August 2010, Mr Holmes wrote another letter, again asking WINZ to review the decision “to deny me extra help like TAS or any other form of benefit

help on 5/7/2009”.  The letter acknowledges that it is out of time.   It repeats complaints of lies, deceit, discrimination, etc.

[21]     On 9 August 2010, WINZ replied, saying that the case manager who saw him on 13 October 2009 discussed this assistance (non-recoverable supplementary allowance)  with  him,  but  he  never  applied  for  it.    The  author  of  the  letter, Mr Rakiraki, invited him to test for his eligibility for temporary additional support and enclosed an application for this purpose.

[22]     On 11 August 2010, Mr Holmes wrote to WINZ.  It starts by referring to his letter  on  10  October,  but  moves  on  to,  at  the  end,  discussing  the  letter  from Mr Rakiraki in these terms:

I have received a further letter from Mr S Rakiraki full of yet more lies and deceit, he is nothing to do with me as paperwork shows! I have the flu and will respond to his paperwork at a later date.

[23]     That letter was replied to by WINZ on 18 August by Mrs Dixon, the branch manager, in these terms:

Thank you for your letter of 8 and 11 August 2010 concerning reviewing a decision  to  decline  extra  assistance  by  way  of  Temporary  Additional Support.

The contents of these recent letters refer to the same matter directed to

Simon Rakiraki and responded to on 9 August 2010, by him.

I am trying to locate any papers as you requested regarding details of offers to advise your income details to Housing New Zealand.  As soon as I am able to locate anything, I will provide copies to you.

Your other concerns are to do with your current appeal before the Social

Security Appeal Authority and I am therefore, not in a position to comment.

If you have questions about the appeal, you can contact Donna Thian, Appeals Officer, PO Box 1556, Wellington.

If, however, your questions are about the appeal process, you will need to contact the Ministry of Justice in Wellington.

[24]    We now come to the letter from Mr Holmes of 22 August, which is the foundation of the Tribunal’s decision to award Mr Holmes damages.  This letter we set out in full:

Dear Branch Manager/Dunedin Central, WINZ

1.      I respond to yet another letter full of lies and deceit dated 18/8/10 from yourself. The content of my letters does not refer to matters directed to and responded to on 9/8/10 by S Rakiraki at all!  My other concerns, were to bring further lies and deceit to your attention but as you refuse to act/respond to my real concerns, please note the following: and respond.

2.      I ask you to review the decision to deny me my increase April 1st 2010 until I started making inquiries in regard to this matter.  (This is in line with the threats and intimidation made against me and my children “our contacts in WINZ” will take care of me.)  This is of course out of time due to other matters and your contacts, threats, which I have to consider carefully.

3.      Please supply all letters of correspondence in relation to this denial to myself or any third party or other party in relation to no. 2 of this letter under Privacy Act 1993, and Official Information Act 1982 in regard to letters between other parties and yourself.   Please supply reasons, of decision to deny, under Ombudsman Act 1975, as advised.

4.      Please  confirm  in  writing  that  you  are  refusing  to  review  the  2 previous requests of 27/7/10 and 8/8/10.  I have already stated my concerns over Mr Rakiraki and this is also not in line with correspondence from the Chief Ombudsman, due to MSD lies and deceit.

5.      I have and continue to suffer severe hardship due to your intentional actions and decisions by M.S.D. and your contacts.  Money was stolen some years ago and the Ombudsmans Office failed to act as involved, all documented.

Yours sincerely

[25]     Mrs Dixon replied to this on 27 August 2010 in these terms:

Dear Mr Holmes

I have received your letter dated 22 August and respond to your queries:

Your letter of 27 July claimed that you were denied extra help, namely TAS, on 13 October 2009.  You did not apply for TAS or provide information to enable a grant to be considered.  Mr Rakiraki has since requested that you apply for this Temporary Additional Support.   To date, no application has been received.

On 8 August your letter requested all paperwork under the Privacy Act referring to this department offering to provide your income details to Housing NZ and your understanding that you did not agree to this.

My response to you on 18 August was that I was still attempting to locate such paperwork.  I have now located one electronic note dated 5 July 2007 when the case manager at South Dunedin reports that you refuse to provide information about your income to Housing NZ. A copy of this is attached.

I am unable to locate any other references as you request.  Your file has not been searched at this point because it is currently held by the Social Security Appeal Authority.

Yours sincerely

[26]     On 4 October 2010, Mr Holmes wrote to the branch manager at Dunedin WINZ. This letter is the foundation of the Tribunal’s finding of the second breach by WINZ.  This is a letter which starts out by making requests under the Official Information Act for all paperwork in regard to eye test, reading glasses and costs for Mr Meikle.  Mr Meikle is described further in the letter as “an aggressive individual and his relationship with Mr Mills [a MSD/WINZ case manager] is very close as with others in WINZ”.

[27]     It then goes on to make a request under the Privacy Act for “all paperwork supplied to myself in regard to TAS between denial 13/10/09 and S Rakiraki letter full of lies 9/8/10.”   It then turns to the WINZ letter of 27/8/10 disputing that he made no queries, complaining of a refusal to review or confirm in writing to requests by him, criticising Mr Rakiraki as a liar and deceitful person, and also advising that he was going to contact the SSAA and the Ombudsman’s office over her behaviour.

[28]    There was further correspondence from Mr Holmes on 9 November 2010, complaining of failure to supply information requested, and on 7 December 2010.

[29]     On 13 December 2010, Mrs Dixon replied to his letters of 4 October, 9

November and 7 December 2010.  She refused to supply information about another person’s payments details.  She denied that there was any other paperwork that he had not yet got relating to Temporary Additional Support.   She advised that there was no information passing between Housing New Zealand and WINZ.  Referring to the letter of 9 November, she said that she was unable to provide details as to the date he would be entitled to receive TAS until he made an application for it, and that they had not received the decision of the SSAA.  In respect of the paperwork relating to  the  claim  for  dentures  and  spectacles,  dated  13  October,  she  said:  “This information has already been provided as this was the reason for your Appeal.”

[30]     This led to a reply, dated 15 December 2010, essentially disputing it as all lies.

[31]     On 17  December 2010,  Mr Holmes  received  the decision  of the SSAA. There had been a hearing on 8 November at which he had appeared in person.  This was the appeal against the decision of WINZ, upheld by the Benefits Review Committee, to grant the appellant a recoverable ‘advance of benefit’ of $70 rather than a non-recoverable Special Needs Grant. The appeal failed.

[32]     We pass over the ensuing correspondence with WINZ on the subject of the appeal decision, and come to the WINZ letter of 8 September 2011, which is the basis of the second award of damages.  The context is that Mr Holmes has, in the meantime, appealed to the Tribunal in respect of the SSAA decision.

[33]     The main purpose of the WINZ letter, written by Mrs Dixon, was to respond to Mr Holmes’s letters of 22 August and 4 October, in anticipation of the Tribunal hearing.  It says relevantly:

In your letter dated 22 August 2010 you first ask us to review the decision to deny your 1 April 2010 increase until you started making further inquiries and then ask for information in relation to this denial under the Privacy Act

1993 and the Official Information Act 1982.

As you know, in interpreting this request I assumed it must relate to your ongoing concerns in relation to Temporary Additional Support (“TAS”).   I came to this conclusion as the Annual General Adjustment, which occurs on

1 April every year, is an automated process, and I did not have any record of you making inquiries about it.  The increase you were entitled to as a result of the Annual General Adjustment in 2010 was not denied to you, but rather was applied automatically on 1 April 2010.

As there was no denial in relation to the Annual General Adjustment, and knowing that you had ongoing concerns about TAS, this is how I interpreted your request.

You have since indicated that this request did not relate to TAS.  I understand that Crown Law have written to you asking for your interpretation of this request and have not received a response.

I have checked your 2010 Annual General Adjustment and may have found the cause of the confusion surrounding this request.

As you will know, your benefit is paid on Thursdays and it is paid in arrears. This means that on 1 April 2010 you received payment for the period 22

March 2010 to 28 March 2010.  Your next payment, on 8 April 2010 was for

the period 29 March 2010 to 4 April 2010; this payment included dates in both March and April, so it was a combination of the old rate and the new adjusted rate.   Your first full payment at the adjusted rate occurred on 15

April 2010 for the period 5 April 2010 to 11 April 2010.

I enclose documentation relating to these payments for your records.

I recognise that this staged increase resulting in you not receiving your first full payment until mid-April could have caused some confusion.  Work and Income  receives  many  queries  from  clients  in  early April  each  year  in relation to the Annual General Adjustment.   I apologise if you have not previously received a clear explanation...

[34]     After this apology, explained as a result of the demands on staff following the Canterbury earthquake, and after addressing the information he requested about Mr Meikle (denied), Mrs Dixon returned to Mr Holmes’s request for all the paperwork in relation to TAS and enclosed eight documents.  She wrote that he had received all before, except item 7.  Mrs Dixon went on:

The fact that you had received these documents on a prior occasion did not negate Work and Income’s obligations under the Privacy Act 1993 to supply you with the information when you requested it on 4 October 2010.  The reason I point out that you have received this information before is to assure you that we have not deliberately withheld anything from you that you did not already have; we simply misunderstood your request.

I accept that Work and Income had an obligation to provide you with our decision regarding your request for TAS information within 20 working days of your 4 October 2010 request.  I also accept that according to the Privacy Act 1993, our failure to provide you with the information that falls within the scope of your request until today without a good reason to refuse access amounts to an interference with your privacy.

Please accept my sincere apologies for the series of events that led to the delay in releasing this information to you.  Even though in your 4 October

2010 letter you only asked for TAS paperwork that had been sent to you, I

can confirm that the information enclosed is all of the information Work and

Income  holds  in relation to TAS  between the  dates  specified in  your  4

October 2010 request.

We will inform the Human Rights Review Tribunal of this development and agree to a declaration that Work and Income interfered with your privacy in relation to your request for TAS information on 4 October 2010.

[35]     The letter goes on to discuss ongoing concerns about the TAS assessment, and ends:

I apologise if this letter is somewhat repetitive of previous correspondence in relation to these issues, but I just wanted to make sure that each aspect of your requests had been fully addressed and make a final effort to resolve your complaints outside the Tribunal setting.

[36]     On 22 March 2010, Mr Holmes had filed a claim with the Tribunal in relation to the 1 April request.   That centred on his privacy requests of 22 August and 4

October 2010.

[37]     What had actually happened was not fully understood by Mrs Dixon at the time she wrote these last letters.

[38]     It  can  now be seen  that  Mrs  Dixon,  in  her letter of 8  September 2011, partially explained what happened with the additional benefit acquired by way of the Annual General Adjustment on 1 April.  The explanation was that benefits are paid in arrears, so that the first payment after 8 April included dates in both March and April.  It did not explain that the last payment to clear the advance for the eye test cost was $1, and that that occurred about 1 April 2010. Second, it does not explain that the rate of $3 per week was then continued for a few weeks, down to 19 May, together with the $1 per week (a total of $4) to clear the driving licence advance.

[39]     The Tribunal found that the amount to be repaid is not necessarily the rate of repayment agreed by the parties:

[24]     ... But even that rate may not necessarily be accurate for any length of time.  Here the letter dated 13 October 2009 told Mr Holmes that the repayments  would  be  at  a  rate  of  $3  a  week  but  the  printouts  headed SWIFTT-Production (Exhibit A) show a “recovery rate” of $1 per week in relation to “An invoice date of 9 November 2009, which presumably relates to the advance payment approved on 13 October 2009”.

[40]     It is a matter of calculation that repayments at the rate of $3 per week cannot add up to $70.  They add up to $69, leaving $1 to be paid.  In normal business terms, a last payment of $1, being less than the $3 per week previously agreed, would not normally be described as a rate “not necessarily ... accurate for any length of time”.

[41]    The more significant confusion is that Mr Holmes was never told that the decision to make repayments at the rate of $3 per week in respect of the eye test

allowance might be applied to clear away the balance of the driving licence advance and, second, that Mrs Dixon did not know that that decision had been made.  There has never been any production of evidence of how the decision was made.  Before us, Ms Holden advised it was a decision by an officer, not the application of a computer program.

Application of the provisions of the Privacy Act 1993

[42]     The subject matter of the Privacy Act is information privacy.  The long title of the Act is:

An Act to promote and protect individual privacy in general accordance with the Recommendation of the Council of the Organisation for Economic Co- operation  and  Development  Concerning  Guidelines  Governing  the Protection of Privacy and Transborder Flows of Personal Data, and, in particular,—

(a)     To establish certain principles with respect to—

(i)     The collection, use, and disclosure, by public and private sector agencies, of information relating to individuals; and

(ii)     Access  by  each  individual  to  information  relating  to  that individual and held by public and private sector agencies; and

(b)     To  provide  for  the  appointment  of  a  Privacy  Commissioner  to investigate  complaints  about  interferences  with  individual  privacy; and

(c)     To provide for matters incidental thereto

(Emphasis added)

[43]     Section 6 (Information privacy principles) is a cornerstone of the Act and sets out 12 principles.  Principle 6 is the subject matter of this litigation.

Principle 6 Access to personal information

(1)     Where an agency holds personal information in such a way that it can readily be retrieved, the individual concerned shall be entitled—

(a)     To obtain from the agency confirmation of whether or not the agency holds such personal information; and

(b)     To have access to that information.

(2)     Where, in accordance with subclause (1)(b) of this principle, an individual is given access to personal information, the individual shall be advised that, under  principle  7,  the   individual  may  request  the  correction  of  that information.

(3)     The application of this principle is subject to the provisions of Parts 4 and 5 of this Act.

[44]     These are legal rights, enforceable accordingly in a court of law; s 11 of the

Privacy Act 1993.

[45]     The reason for principle 6 is not hard to discern.  It is important that personal information held by an agency be accurate and, where necessary, complete, so that it does not, by reason of its defects, undermine the dignity of the individual.  The effectiveness of this principle is secured by enabling the individual to see at any time the  personal  information  held  about  himself/herself.    This  is  a  very  important

principle.  It has been much abused by totalitarian governments in the 20th  century,

and made a very relevant concern by the explosive growth of data stored electronically.  There is an increasing ability by agencies and individuals to collect personal information about others, without their consent. Under the Privacy Act

1993,  there  are  only  limited  exceptions  justifying  a  refusal  to  disclose  any information requested pursuant to principle 6; s 30.

[46]     As well as there being a prohibition against refusal, there is a positive duty to assist an individual to obtain this information.  Section 38 of the Act provides:

38     Assistance

It is the duty of every agency to give reasonable assistance to an individual, who—

(a)     Wishes to make an information privacy request; or

(b)     In making such a request, has not made the request in accordance with the requirements of this Act; or

(c)     Has not made his or her request to the appropriate agency,—

to make a request in a manner that is in accordance with the requirements of this Act or to direct his or her request to the appropriate agency.

[47]     As already noted, on 22 March 2011, Mr Holmes filed a claim with the

Tribunal in relation to the responses to his privacy requests of 22 August and 4

October 2010.  He sought damages, a remedy provided by s 85(1)(c):

85     Powers of Human Rights Review Tribunal

(1)     If, in any proceedings under section 82 or section 83 of this Act, the Tribunal is satisfied on the balance of probabilities that any action of the defendant is an interference with the privacy of an individual, it may grant one or more of the following remedies:

(a)

(c)     Damages in accordance with section 88 of this Act:

[48]     A key finding of the Tribunal, as we will see, is breach of s 38 by WINZ, particularly  Mrs  Dixon,  in  not  giving  reasonable  assistance  to  his  information privacy requests, by reason of the inadequacy of her replies of 27 August 2010 and

8 September 2011 (both set out above).

[49]     Requests have to be answered promptly.  Section 40(1) of the Act provides:

40     Decisions on requests

(1)     Subject  to  this  Act,  the  agency  to  which  an  information  privacy request is made or transferred in accordance with this Act shall, as soon as reasonably practicable, and in any case not later than 20 working days after the day on which the request is received by that agency,—

(a)     Decide whether the request is to be granted and, if it is to be granted, in what manner and, subject to sections 35 and 36 of this Act, for what charge (if any); and

(b)     Give or post to the individual who made the request notice of the decision on the request.

...

[50]     Relevant to the application of s 40(1) is s 66(3), which provides:

66       Interference with privacy

...

(3)     If, in relation to any information privacy request, any agency fails within the time limit fixed by section 40(1) of this Act (or, where that time limit has been extended under this Act, within that time limit as so extended) to comply with paragraph (a) or paragraph (b) of section

40(1) of this Act, that failure shall be deemed, for the purposes of subsection (2)(a)(i) of this section, to be a refusal to make available

the information to which the request relates.

...

[51]     Section 66(1)(a)(i) provides:

(1)     For the purposes of this Part of this Act, an action is an interference with the privacy of an individual if, and only if,—

(a)     In relation to that individual,—

(i)     The action breaches an information privacy principle; or

...

[52]     The Tribunal interpreted this combination of sections to apply where the agency has answered a request, but the answer does not qualify as a s 40 decision. The Tribunal considered that Mrs Dixon had misread the request of 22 August, so that her reply of 27 August, discussing TAS, was not a decision on the request. Having referred to these sections that we have just set out, the Tribunal said:

[35]      The deeming provision [s 66(3)] is of particular significance to the present case given that the facts establish that the “as soon as reasonably practicable and in any case not later than 20 working days after the day on the request” standard was unquestionably breached.   Ms Dixon simply misread the request.  Her letter dated 27 August 2010 [replying to the request of 22 August within five days] did not address the request let alone make a s 40 decision.   This is not something for which Mr Holmes can be made responsible.  Some attempt was later made by Ms Dixon in her letter of 8

September 2011 to provide the information but even at this late stage (a month or so before the Tribunal hearing) the information requested by Mr

Holmes was still not provided.

Whether  or  not  there  was  a  decision  under  s 40,  to  refuse  information, requested on 22 August 2010

[53]     As is implicit at [35] of the decision (set out above), the Tribunal reasoned that because Mrs Dixon’s letter, dated 27 August, did not address the request, therefore it could not be a s 40 decision.  This is further elaborated on at [39] and [40] of the judgment under appeal, which read:

[39]      Addressing the first point made by WINZ (request not clear), neither the terms of the letter from Mr Holmes dated 22 August 2010 nor the context support the assertion that the terms of the request were not clear. The first of the two paragraphs refers explicitly to the 1 April 2010 uplift.  The first day of April in any year is clearly an event of some significance to WINZ given that the Annual General Adjustment involves not only the enormous exercise of reprogramming the payments schedule but also the need to deal with what Ms Dixon described as “the many queries from clients in early April each year”.  Both the terms of the letter (“...the decision to deny me my increase April 1st  2010”) and the context allow of no ambiguity or doubt as to what Mr Holmes was addressing.   Indeed, when asked by the Tribunal whether she agreed that on its face, the letter from Mr Holmes dated 22 August 2010 was clear, Ms Dixon agreed.  She further agreed that it had not occurred to her to go back to Mr Holmes to clarify such doubt or ambiguity as may have been in her mind.

[40]      It follows from this factual finding that the request by Mr Holmes for access to personal information was not met with a decision under s 40 within the statutory period prescribed by that section and there was accordingly a deemed refusal to make available the information to which the request related.

[54]     The questioning and answers recorded at [39] were put to Mrs Dixon by the Chair of the Tribunal at the end of her evidence.  The Chair qualified his questions by prefacing them so that they were framed with the benefit of hindsight.  With the benefit of hindsight, and where the second paragraph of Mr Holmes’s letter of 22

August is clearly delineated and examined, the analysis is undoubtedly correct. But there is equally no doubt that, at the time, Mrs Dixon did not read it that way, as the Tribunal found at [35]. There is no doubt that Ms Dixon did understand it to be a request for a review, but thought wrongly it was a TAS request, and within five days set out to answer it.

[55]     There is no provision in s 40 which defines “decisions on requests”.  There is

no  provision  which  identifies  the  possibility  that  the  request  will  be  genuinely

misunderstood.   There is a distinction between misunderstanding a request and realising that the request calls for further inquiry.

[56]     It may be noted that on receiving Ms Dixon’s reply to his letter, Mr Holmes

did not respond to clarify his request.

[57]     Counsel for the appellant in this Court did not submit that the response of Mrs Dixon did not comply with s 40, and so was a refusal.   Their response was framed more broadly:

Privacy Principle 6, it is submitted, cannot impose an obligation on agencies to interpret information requests with the perfection of hindsight.  The courts have warned against the temptation of judging past actions in light of present facts and knowledge on several occasions.

The Privacy Act gives rise to important rights, and significant obligations. But it does not assist individuals seeking to exercise their rights under the Privacy Act to impose on agencies an absolute liability for human error.

[58]     That led to a broad submission that Mrs Dixon’s letter to Mr Holmes of

27 August, responding to his letter of 22 August, met WINZ obligations under the

Privacy Act.

[59]     Mr Andersen, the amicus curiae, argued that it did not.  He framed this issue not as to whether or not there was a decision under s 40.  He argued that the request was expressed in clear terms.  He argued that the response to the request should have been for WINZ to provide details of Mr Holmes’s payment and deduction, sufficient to enable the following to be ascertained:

(a)       Mr [Holmes] was receiving the benefit of the increase from 1 April

2010; and

(b)       Mr Holmes was receiving $3 per week less than he expected because WINZ had changed the deduction that he had been told would be $1 per week for the $44 advance to $4 a week without notification to him.

[60]    He submitted that the error of the appellant was to put a gloss on privacy principle  6  by  reading  it  as  only  applying  to  requests  that  were  reasonably understood by the agency.  He argued that privacy principle 6 is an absolute right to receive information, and a failure to receive the information on the request means the

principle is being breached.  He centred his argument on s 66(3), which he reinforced by citing s 30 of the Act, which provides:

30      Refusal not permitted for any other reason

Subject to sections 7, 31, and 32 of this Act, no reasons other than one or more of the reasons set out in sections 27 to 29 of this Act justifies a refusal to disclose any information requested pursuant to principle 6.

And relying on s 85(4), which provides:

(4)     It shall not be a defence to proceedings under section 82 or section 83 of  this  Act  that  the  interference  was  unintentional  or  without negligence on the part of the defendant, but the Tribunal shall take the conduct of the defendant into account in deciding what, if any, remedy to grant.

[61]     We think that principle 6 does not address the question of a misunderstanding of the question.  Given the separate provisions of ss 40, 66 and 84, it is not possible to  draw from  privacy principle 6  the proposition that  privacy principle 6  is  an absolute right to receive information, and failure to receive the information on the request means the principle has been breached.

[62]     Section 66(3) addresses non-compliance with time limits.  There is nothing to suggest that Parliament intended in that section to impute a reply made within the time, but which was inadequate.  Rather, the obvious function of s 66(3) is to deem failures to reply in time as refusals.  That policy can be understood as discrete and separate from an inadequate response to the question.  Plainly, an agency receiving a confused request has a duty to give reasonable assistance to the person making the request by application of s 38.  Parliament, elsewhere in the statute, treats refusal of a request as being a deliberate decision not to answer a question – see s 44:

44      Reason for refusal to be given

Where an information privacy request made by an individual is refused, the agency shall,—

(a)     Subject to section 32 of this Act, give to the individual—

(i)     The reason for its refusal; and

(ii)     If the individual so requests, the grounds in support of that reason,  unless  the  giving  of  those  grounds  would  itself prejudice the interests protected by section 27 or section 28 or

section 29 of this Act and (in the case of the interests protected by section 28 of this Act) there is no countervailing public interest; and

(b)     Give to the individual information concerning the individual's right, by way of complaint under section 67 of this Act to the Commissioner, to seek an investigation and review of the refusal.

[63]     Also, s 30 contemplates a refusal, setting out reasons; s 27 sets out public interest reasons to refuse; s 28, trade secret reasons; and s 29 deals with other reasons to refuse.

[64]     None of  these provisions treat a misunderstanding of the request as a refusal. These sections tend to reinforce the notion that s 30, like the other sections of the Act, is addressing deliberate decisions to refuse to disclose information.   What is quite clear in this case is that Mrs Dixon never made any deliberate decision to refuse information.

[65]     Section 40 is directed to setting up the timetable for reply.  It is not actually addressing what constitutes a decision on a request. There is nothing in it which says that a flawed reply is not a decision, or a failure to reply.  Rather the decision contemplated by s 40 is the decision whether or not to release information held by the agency.

[66]     Plainly, Mrs Dixon was not intending to refuse to supply information.  She did not understand the letter of 22 August to be a request for information.

[67]      It is important to keep in mind that this is an Information Privacy Act.  The wording of s 40 reminds us of the purpose of the Act.  The reason its text focuses on whether or not a decision is made, not as to the content of the decision, is because the decision is whether or not to release personal information held by the agency. Nothing more than that.  It is not the purpose of the Act to require agencies to give reasons for their internal decision-making.  It is not the purpose of the Act to explain why or why not they have done something in respect of the person.  The purpose of the Act is solely to enable private individuals to ascertain what facts or other information about them are held by the agency.

[68]     Mrs Dixon misread the letter.  She has been criticised for that, on the grounds that the question is clear:  “Why did I not get my increase?”  There is no finding of bad faith against Mrs Dixon.   Rather, there is a finding that she did misread the letter.8   So how did she misread this letter of 22 August?  It seems to us that there are at least two reasons why, neither of which have been considered by the Tribunal. The first is that the proposition in paragraph 2, that he had been denied the general

increase payable to all beneficiaries from 1 April 2010, does not make sense.  Mr

Holmes said in his submissions to us that the annual increase comes every year on 1

April, April Fools’ Day, he emphasised.  He knows about that.  He did not suggest in any way in his submissions to us that he feared that he might have been singled out as a beneficiary who would not get the annual increase.  He was, however, puzzled, because the first payments he received after 1 April did not have an increase which matched the well-known, publicly announced figure of $3.73.

[69]     In her letter of 8 September 2011, when much later she had realised that the question was about the annual increase, Mrs Dixon endeavoured to explain.  She explained by pointing out that the payments are made in arrears, and the fortnight in arrears payment straddled 1 April.

[70]   In paragraph 3 of the letter of 22 August, Mr Holmes requests all correspondence in relation to this denial.   There was no such correspondence, as there had been no denial.   There could be no decision to refuse to supply non- existent information.  There is nothing in the letter of Mrs Dixon on 27 August 2010 or thereafter which suggests that MSD/WINZ had decided to refuse to provide personal information on the file.  She had not.

[71]     We can now see that Mr Holmes was asking for correspondence which did not exist.  How then can his request, which premised an extraordinary event which never happened, and which caused confusion in the recipients’ minds, generate a breach of the Privacy Act, when WINZ misunderstood the letter and were not able to

tell him such information did not exist?

8      See [35] set out above.

[72]     Section 40 is premised on a person looking at the applicant’s file, which does contain information, and considering whether or not to accede to the request to disclose the information on the file.  But that is not the situation here.  The decision that Mrs Dixon had to make upon receipt of the letter was not a “decision” as that word is used in s 40. Therefore, s 40 does not apply, without more.

[73]     Alive to the fact that the letter of 22 August was seeking information which did not exist, the Tribunal inferred that it was seeking the information as to how the

$4 per week, being withheld, was being applied.  Doing so, by applying the duty on WINZ to assist, in s 38.   The Tribunal was constructing from a statutory duty to assist a request for information.

[74]     Applying  s 38,  the  Tribunal  concluded  that  the  obligation  of  WINZ,  in response to Mr Holmes’s letter of 22 August, was to decide whether to produce relevant accounting records, showing how the debt offsets were varying substantially in April/May 2010, which would provide Mr Holmes with the personal information being used to determine his weekly payments.  And when WINZ did not, that was a deemed refusal. The reasoning is set out at [51] of the decision:

[51]      When Mr Holmes requested “all letters of correspondence in relation to this denial” [“of the decision to deny me my increase April 1 2010 until I started making inquiries in regard to this matter”] he was looking at the system from the outside.   He did not know anything about the internal accounting system employed by WINZ. All he had in relation to the advance of $70 was the letter dated 13 October 2009.   It was understandable he would assume that if there was to be any change or variation to the stipulated terms of the advance, he would be sent a letter notifying him of the change. In trying to find an explanation for the “non-appearance” of the 2010 Annual General Adjustment in his bank account he understandably assumed that WINZ would  have  sent  him something  by way of  explanation.    It  was entirely logical for him, in seeking information about how his benefit payments were being calculated, to seek “correspondence”.  WINZ, on the other hand, has intimate knowledge of its own internal systems.   It would have taken little effort or imagination to check the accounting records now produced as Exhibit A, to identify that the Debt Offsets were varying substantially in the April-May 2010 period and to then provide Mr Holmes with the personal information being used to determine his weekly payments. Even if, notwithstanding our finding that the terms of the 22 August 2010 letter are clear, WINZ were in doubt as to how to interpret paragraphs 2 and

3 of the letter, inquiry should have been made of Mr Holmes.  Nothing less was required by the duty in s 38 to give reasonable assistance.

[75]     That reasoning changes the request from a request for review of “the decision to deny me my increase” and a request for correspondence, to a request for the personal information on WINZ files used to determine his weekly payments.

[76]     There  is,  no  doubt,  a  duty  in  s 38  to  give  assistance,  but  the  phrase  is

“reasonable assistance”.

[77]    Mrs Dixon was replying to a letter which was in numbered paragraphs. Paragraph 1 says it is responding to her letter of 18 August.  That letter was about TAS. Paragraphs 2 and 3, read on their own, are on a completely different subject matter:  “The decision to deny me my increase April 1st   2010 until I started making inquiries in regard to this matter.”  Paragraph 3 is the request to “supply all letters of correspondence in relation to this denial” and, secondly, to supply reasons for the decision to deny under the Ombudsmen Act.  We notice that Mr Holmes appreciates the  distinction.    Paragraph  4  then  returns  to  TAS.    Paragraph  5  is  a  general

complaint.   Mr Holmes did not reply to  Mrs  Dixon’s letter of 27 August until

December.

[78]     The reasonable assistance analysis at [51] by the Tribunal does not sit easily with Mr Holmes’s knowledge of his entitlements and his ability to pursue issues. True, he was looking at the system from the outside, but in fact he was in almost constant engagement with the system.  The very terms of his letter of 22 August demonstrate this, by quoting and distinguishing between what he was entitled to under  the  Privacy  Act,  under  the  Official  Information  Act,  and  under  the Ombudsmen Act.  He was not a hapless beneficiary in need of help.  On the contrary, he was and is an intelligent, well-informed beneficiary, who has argued familiarity with various statutes which provide him remedies.

[79]     When one applies the standard of “reasonable” assistance in s 38, one should take into account the ability of the person seeking information to respond and the context.  One of the reasons why Mr Holmes may not have bothered replying is that he may not have wanted to pursue the matter.  The first sentence at paragraph 2 of the letter ends, “until I started making inquiries in regard to this matter”.  We know that the last payment of $1 to clear the $70 advance was made about 1 April.  We

know that the $3 was then applied to the $1 per week otherwise being applied to reduce the driving licence.   We know that that debt was cleared on 19 May.   So within a few weeks both debts were cleared and the full entitlement would have come through.  By the time Mr Holmes wrote the letter on 22 August, Mr Holmes must have appreciated that his income had risen by $7.73, being the annual increase plus the $4 that was being diverted prior to 1 April 2010.  What would have been left in his mind was the mystery of why he did not get any increase beyond 73 cents after

1 April until a few weeks later?

[80]     The Tribunal’s reasoning hinges therefore on its judgment that on receipt of the letter of 22 August, which did not make sense, as everybody got the annual increase and there was no decision to deny Mr Holmes his, the letter should have been interpreted by WINZ as a request for information about how his net payments were calculated from 1 April to about mid-May 2010.

[81]     On our view of the facts, this constructed request reasoning, found to be the reasonable assistance required by s 38, does not sit with the reasonable response of Mrs Dixon, albeit a mistaken response.  Mrs Dixon’s letter of 27 August can itself be read as reasonable assistance.  For what Mrs Dixon did was to reply according to her interpretation of the letter, which was based on its immediate context, as replying to earlier WINZ letters on TAS.  She wrote a reply immediately in five days.  Had this been  a  letter  from  a  beneficiary who  had  never  written  before,  which  was  not prefaced by purporting to reply to letters on another topic, and it was a simple letter out of the blue, “Why haven’t I received my increase?”, the response may well have been quite different and the reasoning of the Tribunal at [51] apt.  Mr Holmes had plenty of opportunity within the 20 day period, running from 18 August, to reply to the letter of 27 August.  He did not.  In these circumstances, we do not think that s 38 was breached.  For that reason, we cannot agree with the reasoning and conclusions at [51] of the Tribunal’s decision.  Mrs Dixon had a basis for being confused.  She was in fact confused.  But she did not make a decision to refuse information.  She responded positively.  In these circumstances, we do not think that her letter was a breach of the Privacy Act. That finding of breach is quashed.

Second head of liability – the later refusal to supply the TAS information as requested on 4 October

[82]     This head of liability is not disputed.  On 4 October, as previously noted, Mr

Holmes  requested all  paperwork supplied to  himself  in  regard to TAS  between

13 October 2009 and 9 August 2010.  On 13 December 2010, Mrs Dixon refused to supply information, saying that this information in respect of the dentures and spectacles had “already been provided as this was the reason for your Appeal.”

[83]     On 8 September 2011, she apologised and sent all the paperwork in relation to TAS, enclosing eight documents, all of which he had received before except item

7.  She acknowledged that the fact he had received these documents on a prior occasion did not negate MSD/WINZ obligations to supply the information when he requested it on 4 October.

The finding that the Tribunal erred in finding that MSD/WINZ’s breaches were

“sustained and systemic”

[84]     Having found that there was a second breach in relation to the request dated 4

October, the Tribunal said:

[62]      Nevertheless, while we decline to make a restraining order, we have real concerns about the degree to which the Dunedin branches of WINZ are complying with their obligations under Principle 6 to provide access to personal information on request and it will be seen that later in this decision we find there was a further breach in relation to the separate information privacy request dated 4 October 2010.  Having regard to s 85(4) of the Act we  find  that  the  failures  in  the  present  case  have  been  sustained  and systemic.    They  underline  the  need  for WINZ  to  undertake  a  thorough review of its processes for ensuring full compliance not only with the letter of the Privacy Act but also with its objects and purposes.  We make an order pursuant to s 85(1)(d) and (e) that WINZ undertake such review under the direction and guidance of the Privacy Commissioner.

[164]   We  found  that  this  order  was  made  without  first  giving  notice  of  the possibility of such an order to MSD/WINZ.  Secondly, and more definitively, that a Tribunal has no power to make this order under s 85(1). This order is quashed.

Solicitors:

Crown Law Office –  [email protected]   [email protected]

Office of Human Rights Proceedings, Wellington - [email protected]

L A Andersen, Barrister, Dunedin - [email protected]