Community Bereavement Trust v New Zealand Qualifications Authority HC Wellington CIV 2009-419-1588

[2011] NZHC 1120

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2009-419-1588

BETWEEN  COMMUNITY BEREAVEMENT TRUST Plaintiff

ANDTHE NEW ZEALAND QUALIFICATIONS AUTHORITY First Defendant

ANDTHE FUNERAL SERVICES TRAINING TRUST OF NEW ZEALAND

Second Defendant

Hearing:         29 August 2011

Counsel:         J Witehira for Plaintiff

L J Taylor and J B Orpin for First Defendant
J M Morrison for Second Defendant

Judgment:      2 September 2011

JUDGMENT OF SIMON FRANCE J

Introduction

[1]      Around February 2002, the plaintiff applied to New Zealand Qualifications Authority  (“NZQA”)  for  accreditation  to  assess  standards  that  would  allow successful  students  to  obtain  the  National  Diploma  in  Funeral  Services.     In accordance  with  the  specified  process,  NZQA  sought  input  from  the  relevant Industry Training Organisation, the second defendant, on whether the application met  the  published  criteria.    The  second  defendant  was  not  supportive  of  the

plaintiff’s application.

COMMUNITY BEREAVEMENT TRUST V THE NEW ZEALAND QUALIFICATIONS AUTHORITY HC WN CIV 2009-419-1588 2 September 2011

[2]      The process became very protracted.  The application was varied in June of

2002 to a much more modest one which sought authority to teach one component of the Diploma.  The second defendant still opposed.  Tensions developed between the two defendants, but none of this resolved itself in favour of the plaintiff.  Eventually in 2005 a further amended and even more limited application was made, and in June accreditation was given on the amended application.

[3]      However, since January 2003 the second defendant had not been consulted. When it learned of the June 2005 accreditation, it complained to NZQA.   NZQA arranged an independent review, the results of which led it, in September 2006, to give the plaintiff notice that it intended to revoke the June 2005 accreditation.  The plaintiff replied by expressing unhappiness with the idea that its accreditation was being reviewed when nothing had changed since June the previous year and it had not even begun to offer the courses.   It made no attempt, however, to address the substantive concerns, and revocation inevitably followed.

[4]      It took the plaintiff (then represented by different counsel) almost two years to   file   judicial   review   proceedings.      The   pleadings   were   inadequate   and non-compliant in fundamental ways.   A period of orders, unless orders, strike-out applications  and  extension  applications  then  followed,  until  in  March 2009  the proceedings were struck out.

[5]      In   November 2009,   the   present   proceedings   were   filed.      Like   their predecessor they combined judicial review with a damages claim.   The pleadings have subsequently undergone two further amendments.  The last amended claim was filed in December 2010.   It abandons all efforts at judicial review, and just claims damages.

[6]      The two defendants have filed summary judgment applications.  There have been other applications along the way because the plaintiff had not paid the costs awarded on the previous proceedings.   Those matters have now been remedied, including the payment of the security for costs on these proceedings.

[7]      The summary judgment applications are based on the proposition that the circumstances do not give rise to a claim of damages against either defendant.  The summary judgment applications assume that the pleadings are based on a claim of breach of statutory duty.   Accordingly, the basis for the applications is the well known judgment of Lord Browne-Wilkinson in X (Minors) v Bedfordshire County

Council[1] and subsequent Court of Appeal applications of that, including Minister of

[1] X (Minors) v Bedfordshire County Council [1995] 2 AC 633 (HL).

Fisheries v Pranfield Holdings Ltd.[2]

[2] Minister of Fisheries v Pranfield Holdings Ltd [2008] 3 NZLR 649 (CA).

[8]      The hearing of the applications was somewhat unusual.   Counsel for the defendants completed their submissions by lunchtime on the Monday.   However, when  called on,  Mr Witehira sought  further time to  consider  his  response.    He advised  there  had  been  delays  in  him  receiving  the  defendants’  submissions (received by him on Thursday afternoon and Wednesday afternoon respectively) due to his changing addresses, and the defendants not realising.  This meant counsel was not in a position to address the legal arguments that had been advanced.  The written submissions filed by the plaintiffs had taken a focus that summary judgment was inappropriate because of the complex factual matrix which a Court needed to hear. Mr Witehira  sought  adjournment  to  the  next  day.     Although  the  defendants’ submissions had been received within the standard time frame for these types of application, and the application for summary judgment had identified X (Minors) as its basis, the adjournment was granted unopposed.

[9]      When the hearing resumed, Mr Witehira advised that he preferred to rely on his written submissions which, as noted, stress the facts.  When pressed, he conceded he could not meet the defendants’ legal contentions.  He confirmed that the current causes of action were intended to be a claim of breach of statutory duty giving rise to damages, and accepted that the plaintiff could not succeed on such a contention.

[10]     I am satisfied the concession is properly made.

[11]     To establish a breach of statutory duty, it is necessary to first establish there was a duty to do something, and that the duty was breached.  Second, it has to be shown that the breach was of a type that would give rise to a private law cause of action.

[12]     The  pleadings  allege  that  NZQA was  under  a  duty  to  give  the  plaintiff accreditation  when,  as  alleged,  its  application  was  fully  compliant  with  the publicised plan applicable to the Diploma in Funeral Services.   For summary judgment one assumes it was so compliant.  The provision relied on by the plaintiff as creating the duty is arguably not the applicable provision.  It is probably the case that the National Qualifications Framework is provided for by a different section of the Act, and the one relied upon has no relevance.

[13]     However, even given that, I am reluctant to totally rule out the possibility of a statutory duty.  The circumstances of the hearing meant that I did not hear contested submissions on the detail of the Framework, and the extent to which there is a discretion in NZQA, once the Plan criteria are met, to not grant accreditation.  I do not know, for example, whether wider policy issues such as provider numbers are relevant  to  the decision  or if  everyone who meets  the criteria is  entitled  to  be accredited.  If the latter, the idea of a statutory duty cannot be discounted.

[14]     However, I do not consider that a breach of such a duty would give rise to a private law cause of action.  There is nothing about the scheme to suggest that the duty was imposed for protection of the limited class of people that are applicants for accreditation.   The scheme is about ensuring standards and consistency.   It is legislation designed to protect, first and foremost, the students, and slightly more remotely the community who might rely on the qualifications.   The appropriate remedy for a breach is judicial review.

[15]     The second decision made by NZQA was the revocation of the plaintiff’s accreditation.  It is unclear what statutory duty is alleged by the plaintiff to have been breached.  However, there is obviously in the pleadings a claim of breach of natural justice, and perhaps, related to that, an unarticulated claim of legitimate expectation. In so far as the claim is for a failure to give proper notice, the section relied upon in

the pleadings as giving rise to a specific notification duty is inapplicable.  Further, the plaintiff would struggle, even on summary judgment, to overcome the plain fact that it was given notice and an opportunity to comment.  Its real contention is that the fact of accreditation created some sort of expectation or estoppel that unless things changed, it would remain in place.

[16]     None of this is even remotely pleaded, and is noted by me only in the context of the brief explanation I am giving as to why I accept the concession made by plaintiff’s counsel.  I consider the prospects of establishing a breach of statutory duty giving rise to a private law cause of action to be even more remote in the area of the revocation decision.

[17]     The plaintiff’s concession as the fundamental flaws in its pleadings and case applies equally to the second respondent.  I observe that I do not really understand, in a breach of statutory duty context, what the claims against the second respondent are, so I do not address them further.  The pleadings seem to me to confuse who is the decision maker.

[18]     Mr Witehira sought to resist summary judgment on the basis that he would like time to amend the proceedings to contend for a breach of a common law duty of care. The possibility of adjournment can be readily discounted:

(a)      the history of the proceedings speaks for itself – the difficulties to date, and the considerable costs the defendants have been put to, stem in part from wholly inadequate pleadings and that remains the case;

(b)Mr Witehira could not articulate at all the case for a duty of care.  He had  already  had  an  adjournment  in  this  hearing  to  consider  his position.  It was known that, at the resumed hearing, there would be a concession that the current pleadings did not give rise to a basis for damages.    In  those  circumstances  if  some  alternative  was  to  be floated, the Court and the other parties are entitled to a reasonable synopsis of what it might be.  I have no confidence that an alternative claim based on duty of care would, or could on the facts, emerge;

(c)       there would be formidable limitation difficulties attaching to much of the period;

(d)      the pleadings are simply not good enough technically or substantively.

This is the second time the defendants have had to grapple with such a situation and expend money on it.  One would need very good reason to expose them to yet another pleading, and no such reason exists.

[19]     The applications of both defendants for summary judgment are granted.  The defendants are separately entitled to costs and disbursements.  If agreement cannot

be reached, memoranda may be filed.

Simon France J

Solicitors:

J L Witehira, Swayne McDonald Lawyers, Auckland
L J Taylor, Stout Street Chambers, Wellington, email:  [email protected]

J B Orpin, Stout Street Chambers, Wellington, email:  [email protected]

J M Morrison, Barrister, Wellington, email:  [email protected]