IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2021-485-433
[2022] NZHC 1654
BETWEEN LANCE DAVID MORRISON
First Plaintiff
RICHARD TIMOTHY BLACKWOOD
Second PlaintiffAND
FINANCIAL MARKETS AUTHORITY
First Defendant
ATTORNEY-GENERAL
Second Defendant
Hearing: 17-18 October 2022 Appearances:
D H O’Leary for Plaintiff
T C Stephens, J B Orpin-Dowell for First Defendant A M Powell and F E S F Girgis for Second Defendant
Judgment:
30 June 2023
JUDGMENT OF McQUEEN J
Table of Contents
Para Nos
Background[3]
Criminal proceedings against plaintiffs[4]
The plaintiffs’ evidence[26]
The plaintiffs’ claim [36]
The issues[41]
First cause of action: Is a remedial private right of action in tort
available to the plaintiffs in relation to the prosecution’s failure to properly carry out disclosure obligations under the Criminal Disclosure Act?[43]
Criminal Disclosure Act 2008[44]
Criminal Procedure Act 2011[50]
MORRISON v FINANCIAL MARKETS AUTHORITY [2022] NZHC 1654 [30 June 2023]
Costs in Criminal Cases Act 1967[54]
Breach of a statutory duty[61]
The plaintiffs’ submissions[69]
The defendants’ submissions[77]
Analysis[78]
Conclusion: parliamentary intent to create a private right of action
cannot properly be inferred: first cause of action fails[115]Causation and relief[117]
Final comment[118]
Second cause of action: Does the failure of the Attorney-General (on behalf of the Solicitor-General for the Crown Solicitor at Auckland) to ensure the FMA’s compliance with its disclosure obligations, or to
discontinue the criminal proceedings, found a private law right of action
in tort against the Attorney-General?[119]
Preliminary comments[119]
Plaintiffs’ submissions[120]
Attorney-General’s submissions[122]
Analysis – Failure to ensure FMA’s compliance with disclosureobligations[125]
Analysis – Failure to discontinue the criminal proceedings[126]
Conclusion: second cause of action fails[133]
Third cause of action: Did the accepted breach of disclosure obligations breach the plaintiffs’ fair trial rights, and if so, are public law
damages required to properly vindicate the plaintiffs’ rights?[134]
Plaintiffs’ submissions[135]
Attorney-General’s submissions[139]
Analysis[142]
(a)General nature of the NZBORA rights at issue[143]
(b)Framework for consideration of a claim for NZBORA damages
based on breach of disclosure obligations[150]
(c)Did the disclosure failures breach the plaintiffs’ fair trial rights,
including the right of trial without undue delay?[181]
(d) Availability of public law damages in the present case[197] [209] Result[211]
Costs[212]
[1] This is a claim by Mr Morrison and Mr Blackwood (the plaintiffs) for general, special, exemplary, and public law damages. It arises from the Crown’s accepted disclosure failures during the prosecution of the plaintiffs for financial offending. The plaintiffs’ claim relies on a breach of a statutory duty to make criminal disclosure pursuant to s 13 of the Criminal Disclosure Act 2008 (the CDA) and an alleged breach of their fair trial rights under the New Zealand Bill of Rights Act 1990 (the NZBORA).
[2] The defendants in this proceeding are the Financial Markets Authority (the FMA), and the Attorney-General on behalf of the Solicitor-General, sued in relation to the acts of the Crown Solicitor at Auckland. The defendants resist the plaintiffs’ claim. They say that the plaintiffs’ causes of action premised in tort are unavailable to them. The Attorney-General contends also that the plaintiffs have already received appropriate remedies for whatever failures occurred throughout the course of their prosecution, and that their fair trial rights either were not breached or have been adequately vindicated.
Background
[3]The relevant facts are largely agreed as between the parties.1
Criminal proceedings against plaintiffs
[4] For present purposes it is not necessary to recount other than briefly the circumstances that led to the filing of charges by the FMA against the plaintiffs. Those circumstances have been adequately summarised by the courts in previous cases.2 Of key importance to this case is what occurred following the filing of charges against the plaintiffs.
[5] The charges arose from the collapse of two companies, Viaduct Capital Ltd, and Mutual Finance Ltd. Those companies were placed into receivership in mid-2010,
1 The FMA indicated that to the extent that pleaded matters relating to disclosure are denied in the FMA’s statement of defence, the denials take issue with the way some of the underlying events are characterised in the statement of claim, noting that in its view, the case does not turn on those characterisations. Submissions for the FMA included an appendix setting out the FMA’s position where it considered the plaintiffs’ characterisation of events to be erroneous.
2 See for example R v Bublitz [2019] NZHC 222 at [11]–[44]. [Second Trial Verdicts and Reasons Judgment].
in the wake of the 2008 global financial crisis. Broadly, it was alleged that the two companies misled investors and made improper related party transactions. In late 2010, the Serious Fraud Office undertook an initial investigation into the conduct of the two companies before referring the matter to the FMA. On 11 March 2014, the FMA filed charges against the plaintiffs pursuant to ss 220 and 242 of the Crimes Act 1961.
[6] The charges alleged that the plaintiffs had committed theft by misusing investor funds, thereby breaching the terms of two Trust Deeds, and that they had published false statements to induce investors to invest in the two companies. Mr Morrison faced four charges under s 220, and three charges under s 242. He was also accused of being a party to further alleged criminal offending involving Mr Blackwood, alongside others, which resulted in an allegation of a conspiracy under s 66 of the Crimes Act.3 Mr Blackwood faced 22 charges under s 220, and three charges under s 242. He also faced a further three charges under s 377 of the Companies Act 1993 which alleged that he had made false statements to a trustee for debenture holders.
[7] On 14 July 2014, the FMA completed initial disclosure pursuant to s 12 of the CDA. On 29 September 2014, Mr Morrison and Mr Blackwood pleaded not guilty to all charges, following which the Solicitor-General took charge of the prosecution. A trial date was allocated for 9 February 2016. On 18 August 2015, the FMA purported to have completed full disclosure pursuant to s 13 of the CDA. At this time Mr Morrison commissioned a report prepared by a forensic accountant, Ms Tina Payne, which raised the issue of the adequacy of the FMA’s compliance with its disclosure obligations.
[8] The trial did not commence on 9 February 2016 as scheduled. One of the plaintiffs’ co-defendants had sought an adjournment to allow him to retain counsel, and to allow disclosure issues identified in Ms Payne’s report to be addressed. On 11 November 2015, Venning J granted a six month adjournment to allow Mr Bublitz
3 Mr Morrison and Mr Blackwood were charged alongside Paul Bublitz, Bruce McKay, Nick Wevers, and Peter Chevin.
time to retain counsel and prepare his defence.4 However, at that stage, his Honour did not consider that the issues raised regarding disclosure were of themselves sufficient to support an adjournment.5 The trial was rescheduled to begin on 8 August 2016.
[9] Then, on 26 April 2016, Mr Morrison filed an application seeking that the court dismiss seven of the charges he faced on its own motion, in reliance on s 25(a) of the NZBORA, s 13 of the CDA, and s 147(2) of the Criminal Procedure Act 2011 (the CPA). He sought to establish that the Crown had tactically buried him in an enormous amount of information that was not relevant to his charges. Woolford J dismissed that application on the same day on the basis that he was broadly satisfied that such disclosure was necessary.6
[10] A trial began in the Auckland High Court on 8 August 2016, scheduled for a period of three months before Woolford J. The trial went on for a period considerably longer than three months. It has been described as the longest running criminal trial in New Zealand history.7
[11] Several issues arose during the trial. Many of the charges were dismissed during the trial, although for present purposes is not necessary to recount exactly how many or when. On 2 November 2016, Woolford J addressed applications for a stay by Mr Bublitz, Mr Morrison, and Mr McKay.8 By that stage, it was already clear that the trial would be significantly longer than originally anticipated.9 The defendants sought a stay on the basis that the breadth and complexity of the Crown’s case had led to an oppressive trial, with undue delay and prejudice to fair trial rights. Woolford J considered that at that stage there had been no unfairness, and that the high threshold for a stay had not been met.10 He did, however, dismiss further charges pursuant to s 147 of the CPA, to allow the Crown to proceed only on specified charges that represented the “gravamen of the allegations against the defendants”.11
4 R v Bublitz [2015] NZHC 2799 at [35]. [Adjournment Judgment].
5 At [20].
6 R v Bublitz HC Auckland CRI-2014-004-2293, 26 April 2016 (Ruling (No.6) of Woolford J). [First Stay Judgment].
7 R v Bublitz [2017] NZHC 2251 at [43]. [Third Stay Judgment].
8 R v Bublitz [2016] NZHC 2863. [Second Stay Judgment].
9 At [2].
10 At [31] and [37]–[43]
11 Second Stay Judgment, above n 8, at [54]–[55].
[12] Further applications were made in early 2017 pursuant to s 147 of the CPA, with Mr Bublitz and Mr Blackwood seeking the dismissal of certain charges against them. Woolford J issued a results judgment on 3 March 2017, followed by reasons on 9 March 2017, dismissing a further two charges against Mr Bublitz and directing the removal of certain particulars from two other charges.12 Mr Blackwood’s applications were declined with the exception of the dismissal of a single charge.
[13] Following the conclusion of the Crown’s case, which ran for nine months, it was revealed that 14,619 relevant documents had inadvertently been withheld by the FMA.13 This is (and was) admitted by the Crown to be a breach of ss 13(2)(b) and 13(5) of the CDA.14 By the time this came to light, there were two remaining active charges against Mr Morrison (of an original seven charges), and six remaining charges against Mr Blackwood (of an original 28 charges). The hearing of evidence continued, as did disputes about disclosure. On 28 March 2017, the Crown provided a further list of approximately 19,700 documents (of which it considered 1,835 to be disclosable).15 A further 5,506 documents were disclosed in tranches between March and May 2017.16
[14] Following a contested interlocutory hearing, on 10 May 2017 Woolford J declared a mistrial and aborted the trial.17 His Honour said: 18
I am of the view, however, that a lengthy adjournment now would have a prejudicial impact on the defendants’ right to present an effective defence. The case cannot be rerun. Although the issues raised in the late disclosure were live in the trial, the defence is entitled to prepare and present its case with full knowledge of all relevant documentation that both helps and hinders its case. Strategic decisions as to priority and narrative are important in a judge-alone trial as much as a jury trial. Similarly, cross-examination of witnesses for the second or third time is of necessity disjointed and likely to be less effective. Witnesses who are recalled would need to be taken through their earlier evidence in some detail before being asked if that evidence would differ in light of the documents recently disclosed. There is no doubt that cross- examination would have been more direct and robust if the defence had the documents recently disclosed, such as the draft Viaduct report. More concessions could well have been made by Crown witnesses. They are less likely now. It is my view that the Crown breaches of the Criminal Disclosure
12 R v Bublitz [2017] NZHC 331 [Section 147 Results Judgment]; and R v Bublitz [2017] NZHC 394 [Section 147 Reasons Judgment].
13 Third Stay Judgment, above n 7, at [2]–[3].
14 At [2].
15 R v Bublitz [2017] NZHC 1059 at [25]. [Trial Abortion Reasons Judgment].
16 Bublitz v R [2019] NZCA 364 at [32]. [Conviction Appeals Judgment]
17 R v Bublitz [2017] NZHC 936. [Trial abortion results judgment].
18 Trial abortion reasons judgment, above n 15, at [106]–[107].
Act have restricted the choices open to the defence in respect of the presentation of their case, both in manner and extent.
Conclusion
It was regrettable to have granted the application to abort the trial, but I am of the view that there was a real possibility of unfairness to the defendants if the trial was to proceed. The breaches of the Criminal Disclosure Act have given rise to a reasonable danger or apprehension of a miscarriage of justice in the circumstances.
[15] The Crown then decided not to proceed against Mr Morrison on the remaining two charges, because of his allegedly lesser culpability, age, poor health, and the personal inconvenience and pressures associated with defending lengthy criminal proceedings.19 The outstanding charges against Mr Morrison were accordingly dismissed by Moore J on 7 June 2017.20
[16] The remaining defendants (Mr Bublitz, Mr Blackwood, and Mr McKay) then again sought a stay. On 18 September 2017, Lang J dismissed their application.21 In doing so, Lang J considered that the public cost of the trial and its significant impact on the defendants were not sufficient to warrant the granting of a stay.22 His Honour noted that the disclosure failures were inadvertent, and that there was no suggestion that the criminal process was being used for inappropriate purposes or in an oppressive manner.23 He considered that it was still possible for the defendants to receive a fair trial.24 His Honour went on to say that: “assuming a new trial could be concluded in the third quarter of 2018, the disclosure issues will have caused an unjustifiable delay of approximately nine to twelve months”.25
[17] Mr Blackwood’s retrial on four charges pursuant to s 220 began before Toogood J on 13 August 2018. On 5 February 2019, he was found guilty and
19 R v Bublitz [2018] NZHC 373 at [42]. [First Costs Judgment].
20 R v Morrison HC Auckland CRI-2014-004-2293, 7 June 2017 (Callover Minute of Moore J).
21 Third Stay Judgment, above n 7.
22 At [56]–[58].
23 At [63]–[64].
24 At [65].
25 At [71].
subsequently sentenced to a period of nine months’ home detention.26 However, Mr Blackwood’s convictions were then overturned by the Court of Appeal on 16 August 2019.27 In the same judgment, the Court of Appeal acknowledged the profound consequences for Mr Blackwood and his co-defendants from the “extraordinary delays” but also recorded that it considered Lang J’s reasons for refusing to grant a stay to be “unimpeachable”.28
[18] Following the first trial, but prior to Mr Blackwood’s retrial, Mr Morrison and Mr Blackwood applied for costs in relation to the first trial. Mr Blackwood was legally aided throughout the first trial and sought costs of $475,913.24 pursuant to the CPA. Mr Morrison privately retained counsel until October 2015, after which he represented himself. He sought costs of $212,992.90 under both the CPA and the Costs in Criminal Cases Act 1967 (CCCA).
[19]On 9 March 2018, Woolford J awarded:29
(a)$75,000 to Mr Morrison towards the costs of his defence under s 5 of the CCCA; and
(b)$10,000 each to Mr Morrison and Mr Blackwood in respect of the procedural failure in the course of the prosecution under s 364 of the CPA, payable by the FMA.
[20] In determining that Mr Morrison was entitled to a substantial award of costs under the CCCA, Woolford J considered the factors set out s 5(2) of that Act, as well as other factors unique to the trial, including the breadth and complexity of the Crown charge notice, a Crown application to admit hundreds of documents under the co- conspirator’s rule, the unavailability of a Crown expert, the admitted breach of the CDA, and the length of the trial.30
26 Second Trial Verdicts and Reasons Judgment, above n 2; and R v Bublitz [2019] NZHC 592 [Sentencing Judgment].
27 Conviction Appeals Judgment, above n 16.
28 At [36] and [43].
29 First Costs Judgment, above n 19, at [131]. An award of $10,000 was also made to Mr McKay, Mr Bublitz and the Ministry of Justice under s 364 of the CPA, payable by the FMA.
30 First Costs Judgment, above n 19, at [45]–[56].
[21] It was common ground between the parties that there had been a significant procedural failure in the prosecution with no reasonable excuse.31 Accordingly, there was jurisdiction for an award of costs pursuant to s 364 of the CPA, the quantum of which was determined on the basis that s 364 was “primarily intended to serve as a means of sanction, but may well offer some compensation to defendants and others who have incurred loss”.32
[22] Mr Morrison appealed the quantum of the $75,000 award to the Court of Appeal. His appeal was dismissed on 22 August 2019.33 The Court of Appeal reiterated Woolford J’s view that the charges against Mr Morrison were dismissed on technical rather than merits grounds, and not because Mr Morrison had established that he was not guilty.34 Further, as Woolford J was exercising a statutory discretion, he was entitled to make his own assessment of matters, and the Court of Appeal considered that he did so appropriately.35
[23] Then, on 9 December 2019, the Supreme Court dismissed an application for leave to appeal in relation to Mr Morrison’s costs award, noting:36
The proposed appeal by Mr Morrison does not raise any question of general or public importance. Nor do we see any appearance of a miscarriage of justice if this Court does not hear this appeal. The matters raised by Mr Morrison seek to reprise the careful evaluation of the Courts below and we see no basis for doing so.
[24] Following his acquittal on appeal, Mr Blackwood sought indemnity costs pursuant to the CCCA in respect of that appeal, in the sum of $76,536.75. On 16 October 2020, the Court of Appeal declined his application.37 In doing so, the Court stated:38
While Mr Blackwood succeeded with his conviction appeal, this was solely because this Court took a different view from that reached by Toogood J that the Crown had proved one of the elements of the charges against Mr Blackwood beyond all reasonable doubt. This Court did not find
31 At [73]–[74].
32 At [107].
33 Bublitz v R [2019] NZCA 379. [Costs Appeal].
34 At [55].
35 At [56]; citing Reid v R [2007] NZSC 90, [2008] 1 NZLR 575 at [21].
36 Bublitz v R [2019] NZSC 139 at [19]. [Supreme Court Judgment].
37 Blackwood v R [2020] NZCA 504 [Second Costs Judgment].
38 At [23]–[24].
Mr Blackwood innocent, only that it could not exclude the reasonable possibility that he did not know at the relevant times that the transactions were in breach of the related party restrictions in the Crown guarantee. Proof of this element of the charge was always going to be a matter of inference from proved facts. That this Court came to a different conclusion to that reached by Toogood J does not suggest prosecutorial overreach or misconduct. Rather, it suggests the opposite, that the proper inference to draw from proven facts was one on which reasonable minds might differ, particularly applying the very high standard of proof required.
In summary, we do not accept that there was no proper basis for the charges to have been brought against Mr Blackwood. The underlying premise of his costs application is not made out. We do not consider there is anything out of the ordinary that could justify an award of costs for the appeal.
[25] Mr Blackwood also sought indemnity costs in the sum of $284,493.03 in respect of the initial aborted trial and the second trial at which he was convicted. On 28 January 2021, Woolford J awarded Mr Blackwood costs in the sum of $90,000 pursuant to s 5 of the CCCA, in respect of the first trial.39 His Honour considered that it was appropriate to award costs largely on the same basis as in respect of Mr Morrison, and not to the level of indemnity costs.40 Woolford J concluded that, in relation to the second trial, which was not flawed, the general position that costs are not awarded in criminal cases applied.41
The plaintiffs’ evidence
[26] Mr Morrison and Mr Blackwood each filed an affidavit in support, commenting on their financial, professional and personal losses. Notably, prior to being charged, the plaintiffs each enjoyed lucrative and largely successful financial careers. This evidence was not contested by the FMA and Attorney-General, although the FMA alleged that “the plaintiffs’ perceptions about these matters are irrelevant to their claim”.
[27] Mr Morrison incurred costs of $212,992.90 in his defence, and subsequently received costs awards totalling $85,000. He was initially represented by counsel, but then, as a result of mounting legal costs, decided to represent himself from the end of September 2015. He takes issue with the fact that a key Crown expert witness was
39 Blackwood v R [2021] NZHC 33 at [20] [Third Costs Judgment].
40 At [15]–[20].
41 At [19].
ultimately unavailable for cross-examination at the original trial due to poor health, alleging that resulted in a wasting of his legal costs. He says:
The inordinate amount of time spent, the continuing stress endured, and the costs I incurred in preparing for the (aborted) first trial were largely caused by the unnecessary scale of the prosecution’s pre-trial disclosure of largely irrelevant documents, the phenomenon known as ‘dumping’, accompanied by its proven failure to disclose a huge number of relevant documents pre-trial.
(emphasis in original)
[28]And further that:
On 11 March 2014, when the FMA charged me, I was already suffering from stress and anxiety. This stress and anxiety continued to have such impact that my marriage of 40 years ended in separation. For almost four years I spent nearly all of my time defending my liberty during what should have been the best part of my life….That time was taken from me. Instead, I had to busy myself with my defence. Although it was extremely cold when the long (aborted) first trial started in Auckland in early August 2016, I was living in a tent in a camping ground in Avalon…
[29] Mr Morrison’s trial preparation took place while he was living in his tent, which contained boxes of documents, no power or reliable internet, and all of his belongings. He describes this as “stressful in the extreme (on top of the anxiety of the trial itself) and a most unpleasant experience”.
[30] Mr Morrison also discusses the resulting damage to his reputation, saying that he was ignored by acquaintances and shunned by people he thought were friends. He considers that the prosecution failed significantly in its estimate of the required length of trial, and that this unfairly prolonged his precarious position. He says that he remains subject to prejudice owing to the fact that he was never found to be not guilty.
[31]Mr Morrison concludes by stating:
It is now some 12 years since the events that [the] FMA and the Crown alleged were criminal, and I find myself still attempting to get some justice. That is a very long period of upheaval in one’s life and while it is gratifying [that] I was not convicted of any [of] the charges brought against me, it is unpalatable that I was neither acquitted nor ‘established my innocence’ as the Supreme Court put it.
[32] Mr Blackwood incurred costs of $284,493.03 in preparing his defence for the first trial, as well as travel costs between Christchurch and Auckland for the trial. He
says these financial costs were compounded by the loss of his salary for a period of two years (calculated conservatively as $60,000/pa), leading to a total financial loss of $319,493.03. During the first trial, he was residing in a friend’s caravan in Auckland, using a bathroom in a converted garage. He subsequently received a total of $100,000 in costs.
[33] Mr Blackwood notes the lengthy delay between the original trial and his retrial, saying that the second trial began over two years after the first trial had begun. He says that during the period between the two trials, he was unable to find employment as:
…any prospective employer was, necessarily, confronted both with uncertainty as to the outcome of the charges I was then facing and the practical reality that any work I undertook would be interrupted by the requirement to appear at the trial.
[34] Mr Blackwood says that between 2015 and 2019 he was unable to obtain employment, and that following the resolution of matters, his employment prospects and likely earnings have been significantly diminished owing to the reputational damages consequential to the criminal proceedings. Like Mr Morrison, Mr Blackwood considers that a large portion of his legal costs were effectively wasted as a result of the prosecution’s disclosure failures leading to the abortion of the original trial.
[35] Mr Blackwood describes the overall eight and a half year period between the beginning of the Serious Fraud Office’s investigation and his acquittal in the Court of Appeal as one of “uncertainty, stigma and anguish” and of huge personal impact. Mr Blackwood refers specifically to the death of Nick Wevers, who was charged alongside Mr Morrison and himself, and died in March 2017. He also notes the negative effect of his prosecution on his former wife, his son, and his girlfriend.
The plaintiffs’ claim
[36] The plaintiffs filed a statement of claim on 9 August 2021. Their amended statement of claim dated 21 July 2022 pleads three causes of action, which are:
(a)breach of disclosure obligations under s 13 of the CDA thereby preventing the plaintiffs from preparing and presenting their defences
in accordance with their common law and fair trial rights under ss 24(d), 25(a), 25(b), 25(e), and 25(f) of the NZBORA (as against the FMA);
(b)failure to ensure the FMA complied with its disclosure obligations under s 13 of the CDA (with the consequences described in (a) above) and failure to then discontinue the criminal proceedings commenced by the FMA (as against the Attorney-General, on behalf of the Solicitor-
General for the Crown Solicitor at Auckland); and
(c)breach of fair trial rights under ss 24(d), 25(a), 25(b), 25(e), and 25(f) of the NZBORA (as against the Attorney-General, on behalf of the Solicitor-General for the Crown Solicitor at Auckland).
[37] For the loss, pain, suffering, distress and anxiety experienced by the plaintiffs, they seek the following relief on the first two causes of action:
(a)Mr Morrison seeks general damages in the sum of $600,000, exemplary damages in the sum of $50,000, and costs; and
(b)Mr Blackwood seeks general damages in the sum of $650,000, special damages in the sum of $135,000 (being two years’ lost salary and travel costs), exemplary damages in the sum of $50,000, and costs.
[38] On the third cause of action the plaintiffs each seek $30,000 in damages, and costs.
[39] It is sufficient for the moment to say that the defendants accept that there were procedural failures by the FMA but that they otherwise deny the claims made by the plaintiff and say the plaintiffs are not entitled to the relief sought.
[40] The FMA advanced an affirmative defence in their amended statement of defence. That defence was that the plaintiffs’ claim is an abuse of process, being a collateral challenge to earlier judgments of the High Court and Court of Appeal in relation to costs under the CCCA and CPA. The FMA pleaded that the plaintiffs were
seeking to relitigate those judgments. That defence was not separately advanced by the FMA rather counsel substantively engaged with the merits of the plaintiffs’ claim as articulated in the first cause of action. Accordingly, I address the matters raised in the FMA’s affirmative defence in my discussion of that claim.
The issues
[41]The three causes of action give rise to the following issues:
(a)whether a private law right of action in tort (here, against the FMA as prosecutor) is available to a former defendant in criminal proceedings in relation to the prosecution’s failure to properly carry out disclosure obligations under the CDA;
(b)whether the failure of the Attorney-General (on behalf of the Solicitor- General for the Crown Solicitor at Auckland) to ensure the FMA’s compliance with its disclosure obligations, or to then discontinue the criminal proceedings, may found a private law right of action in tort against the Attorney-General;42
(c)if such actions in tort are available, whether they are made out on the facts of this case, and if so whether any award of damages is appropriate and in what amount; and
(d)whether the prosecution’s breach of disclosure obligations also breached the plaintiffs’ fair trial rights under ss 24(d), 25(a), 25(b), 25(e), and 25(f) of the NZBORA, and if so, whether public law damages are required to properly vindicate the plaintiffs’ rights.
[42]I address these issues as they arise in the causes of action pleaded.
42 As will be seen below, I consider it necessary to address these two contentions separately.
First cause of action: Is a remedial private right of action in tort available to the plaintiffs in relation to the prosecution’s failure to properly carry out disclosure obligations under the Criminal Disclosure Act?
[43] In considering whether a private right of action is available to the plaintiffs, it is convenient to first set out and comment on the relevant statutory provisions, together with their legislative history.43 I then turn to the authorities on the tort of breach of a statutory duty, before summarising the parties’ submissions, and analysing the first cause of action.
Criminal Disclosure Act 2008
[44] As already noted, it is accepted that in the criminal proceedings against the plaintiffs, the Crown breached the disclosure obligations in the CDA in a significant fashion. The breach was without reasonable excuse, albeit inadvertent. Section 13 of the CDA relevantly provides:
13 Full disclosure
(1)The prosecutor must disclose to the defendant the information described in subsection (2) as soon as is reasonably practicable after a defendant has pleaded not guilty.
(2)The information referred to in subsection (1) is—
(a)any relevant information, including, without limitation, the information (standard information) described in subsection (3); and
(b)a list of any relevant information that the prosecutor refuses under section 15, 16, 17, or 18 to disclose to the defendant together with—
(i)the reason for the refusal; and
(ii)if the defendant so requests, the grounds in support of that reason, unless the giving of those grounds would itself prejudice the interests protected by section 16, 17, or 18 and (in the case of the interests protected by section 18) there is no overriding public interest.
…
(4)The obligation to disclose information to the defendant under this section as soon as is reasonably practicable is subject to any order made under section 30 or 32.
43 This is a matter that was addressed in some detail by Woolford J in his first costs judgment. See First Costs Judgment, above n 19, at [20]–[28], and [65]–[107].
(5)If information referred to in subsection (2) comes into the possession or control of the prosecutor, or is prepared in recorded form, after the prosecutor has disclosed information in accordance with subsection (1) and before the hearing or trial is completed, the prosecutor must disclose the information to the defendant as soon as is reasonably practicable.
(6)The entitlement of a defendant to information under this section continues while the criminal proceedings are in progress (including any appeal against conviction) and during the period from the conviction until the expiry of the time for lodging an appeal against conviction.
…
[45] Thus, s 13 of the CDA requires the disclosure of any relevant information, including specified “standard information”. This is the second step in a three step process set out in the CDA, under which prosecuting authorities provide disclosure.44
[46] The purpose of the CDA is to “promote fair, effective, and efficient disclosure of relevant information between the prosecution and the defence, and by non-parties, for the purposes of criminal proceedings”.45 Prior to the commencement of the CDA, the obligations of the prosecution to disclose information to the defence were governed somewhat haphazardly both by legislation and common law.46 Such obligations of disclosure were imposed so as to ensure the fairness of trial, a right guaranteed by s 25(a) of the NZBORA.
[47] The mechanisms provided by the CDA to ensure compliance with the obligations created include court orders for compliance with disclosure obligations, the exclusion of evidence, adjournment of the trial and dealing with the matter as contempt of court.47 Other mechanisms exist outside the CDA. As in the plaintiffs’ case, a trial may be aborted if there is a reasonable apprehension of a miscarriage of justice.48 The failure of a prosecutor or offender to comply with the requirements of the CDA may be taken into account at sentencing.49 A lawyer who fails to comply with
44 R v Lyttle [2022] NZCA 52 at [27].
45 Section 3.
46 Te Aka Matua o te Ture | Law Commission Criminal Procedure: Part One Disclosure and Committal (NZLC R14, 1990) at [39].
47 See for example ss 30, 31, 32, 34 and 34A.
48 See for example Trial Abortion Reasons Judgment, above n 15, at [29]; citing R v Marshall [2004] 1 NZLR 793 (CA) at [15].
49 Sentencing Act 2002, ss 9(1)(k), 9(2)(fa) and 9(2)(fb), and 9(5)(a).
disclosure obligations may be subject to disciplinary action pursuant to the Lawyers and Conveyancers Act 2006.50 Further, as is addressed below, there is availability of awards of costs pursuant to s 364 of the CPA and s 5 of the CCCA.
[48] A statutory regime for criminal disclosure was contemplated for some time before the enactment of the CDA.51 Te Aka Matua o te Ture | Law Commission (the Commission) also recommended such an approach in two reports.52 The Commission considered what sanctions should be available in response to non-disclosure in criminal proceedings. In the later of its two reports, the Commission acknowledged the High Court’s inherent power to deal with non-disclosure but went on to recommend that the Court’s enforcement powers be set out in a new legislative regime, which would include a new power to make costs orders against the prosecuting agency under the CCCA.53
[49] When a criminal disclosure regime was eventually set out in what became the CDA, no such power to sanction non-disclosure with a costs award was included. Counsel were unable to draw to my attention to any relevant discussion of the enforcement of disclosure obligations contained in the bill, other than a comment from an opposition Member of Parliament during the third reading of the bill that it would be “for the courts to then determine what the punitive aspect for the police not disclosing in a timely manner will be”.54 There is thus nothing to suggest that Parliament actively considered whether a private right of action for breach of disclosure obligations should be conferred under the CDA, at that time.
Criminal Procedure Act 2011
[50] A power to sanction non-disclosure with a costs award was however included in the CPA. The Law Commission, in its 2005 report Criminal Pre-Trial Processes: Justice Through Efficiency, had recommended several measures to change what it
50 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, sch 1, cl 13.9.
51 Criminal Law Reform Committee Report on Discovery in Criminal Cases (1986).
52 Te Aka Matua o te Ture | Law Commission Criminal Procedure: Part One Disclosure and Committal (NZLC R14, 1990) and Te Aka Matua o te Ture | Law Commission Criminal Prosecution (NZLC R66, 2000),
53 Te Aka Matua o te Ture | Law Commission Criminal Prosecution (NZLC R66, 2000) at [194]– [195] and [214]–[218].
54 (19 June 2008) 647 NZPD 16784, Mr Chester Borrows.
described as “the culture of non-compliance” by criminal justice system participants in relation to pre-trial processes.55 The Law Commission recommended “provision for costs orders, for failures without reasonable excuse to comply with procedural obligations”.56 This was consistent with its earlier recommendations, discussed above, that there should be power to make costs orders to sanction breaches of disclosure requirements.
[51]Section 364 of the CPA provides:
(1)In this section,—
costs order means an order under subsection (2)
procedural failure means a failure, or refusal, to comply with a requirement imposed by or under this Act or any rules of court or regulations made under it, or the Criminal Disclosure Act 2008 or any regulations made under that Act
prosecution—
(a)means any proceedings commenced by the filing of a charging document; but
(b)does not include an appeal.
(2)A court may order the defendant, the defendant’s lawyer, or the prosecutor to pay a sum in respect of any procedural failure by that person in the course of a prosecution if the court is satisfied that the failure is significant and there is no reasonable excuse for that failure.
(3)The sum must be no more than is just and reasonable in the light of the costs incurred by the court, victims, witnesses, and any other person.
(4)A costs order may be made on the court’s own motion, or on application by the defendant, the defendant’s lawyer, or the prosecutor.
(5)Before making a costs order, the court must give the person against whom it is to be made a reasonable opportunity to be heard.
(6)A costs order may be made even if the defendant has not yet been convicted, or is eventually discharged, or the charge is dismissed.
(7)The court may make more than 1 costs order against the same person in the course of the same prosecution.
55 Te Aka Matua o te Ture | Law Commission Criminal Pre-Trial Processes: Justice Through Efficiency (NZLC R89, 2005), see Chapter 11.
56 At [398].
(8)The court may order that some or all of the amount ordered to be paid under a costs order be paid to any person connected with the prosecution.
(9)Subsections (2) to (8) do not limit or affect the Costs in Criminal Cases Act 1967.
[52] The power to make costs orders as initially drafted was not limited to “significant” procedural failures, as s 364 ultimately provided for. It is apparent from the legislative history that the form of this provision was controversial. The Minister of Justice explained at the time that the amendment was to make it clear that such costs orders were “expected to be used rarely and only for significant procedural non- compliance”.57 Once again, counsel were unable to locate any parliamentary discussion of a private right of action based on failure to comply with disclosure obligations.
[53] As noted by the Court of Appeal, the defendant’s responsibility for the offending and the ultimate outcome of their prosecution is irrelevant to the imposition of an order for costs, given the purpose of s 364 is to discourage inefficiency.58 It is a provision that is primarily directed to sanction and the encouragement of compliance so as to ensure efficiency, although there is likely to be a resulting compensatory effect for an aggrieved party.59
Costs in Criminal Cases Act 1967
[54] The CCCA permits the award of costs to a criminal defendant in certain circumstances. The CCCA was enacted following the 1966 report from the Committee on Costs in Criminal Cases.60 The Law Commission reviewed the CCCA and published its report Costs in Criminal Cases in 2000.61 The Law Commission said that:62
57 (27 September 2011) 676 NZPD 21419; (4 October 2011) NZPD 21638.
58 R v Lyttle, above n 44, at [14].
59 At [13]; and Costs Appeal, above n 33, at [44]. The Supreme Court indicated in these proceedings that it may wish to consider this point in the future but has as yet not done so. See Supreme Court Judgment, above n 36.
60 B J Cameron, G A Dallow, R C Savage and R Stacey Report of Committee on Costs in Criminal Cases (12 September 1966). See also (8 Nov 1967) 354 NZPD 4136-4140.
61 Te Aka Matua o te Ture | Law Commission Costs in Criminal Cases (NZLC R60, 2000).
62 At [4].
… the scheme achieves, for the most part, an appropriate balance between competing interests. It serves to provide a level of reimbursement to innocent defendants and a means to censure improper prosecution conduct, while not impeding the proper functioning of the prosecution system.
[55] The Law Commission also referred to its earlier report Compensating the Wrongly Convicted, which recommended that compensation should be paid to the wrongly convicted in certain cases. In this context, the Law Commission went on to explain that the fundamental rationale of the CCCA was to provide a balance between those cases in which there are good reasons for a defendant to receive reimbursement and those in which it is not just for reimbursement to be received.63
[56] The Law Commission then concluded that “the [CCCA]’s rationale is correct, and that the scheme of the [CCCA] is essentially well founded and well balanced”.64 The Law Commission made several recommendations, one of which was that the availability of costs should remain a matter of discretion and the criteria in s 5(2) should not be altered.65
[57]Section 5 of the CCCA provides:
5 Costs of successful defendant
(1)Where any defendant is acquitted of an offence or where the charge is dismissed or withdrawn, whether upon the merits or otherwise, the court may, subject to any regulations made under this Act, order that he be paid such sum as it thinks just and reasonable towards the costs of his defence.
(2)Without limiting or affecting the court’s discretion under subsection (1), it is hereby declared that the court, in deciding whether to grant costs and the amount of any costs granted, shall have regard to all relevant circumstances and in particular (where appropriate) to—
(a)whether the prosecution acted in good faith in bringing and continuing the proceedings:
(b)whether at the commencement of the proceedings the prosecution had sufficient evidence to support the conviction of the defendant in the absence of contrary evidence:
63 At [29].
64 At [35].
65 At [7], and [62]–[68].
(c)whether the prosecution took proper steps to investigate any matter coming into its hands which suggested that the defendant might not be guilty:
(d)whether generally the investigation into the offence was conducted in a reasonable and proper manner:
(e)whether the evidence as a whole would support a finding of guilt but the charge was dismissed on a technical point:
(f)whether the charge was dismissed because the defendant established (either by the evidence of witnesses called by him or by the cross-examination of witnesses for the prosecution or otherwise) that he was not guilty:
(g)whether the behaviour of the defendant in relation to the acts or omissions on which the charge was based and to the investigation and proceedings was such that a sum should be paid towards the costs of his defence.
(3)There shall be no presumption for or against the granting of costs in any case.
(4)No defendant shall be granted costs under this section by reason only of the fact that he has been acquitted or that any charge has been dismissed or withdrawn.
(5)No defendant shall be refused costs under this section by reason only of the fact that the proceedings were properly brought and continued.
[58] The power to award costs under s 5 arises only where a defendant has been acquitted or the charge(s) have been dismissed or withdrawn. Where the power is engaged, the court has significant discretion as to what it “thinks just and reasonable”, and may consider, among other things, the factors contained in s 5(2) in the exercise of that broad discretion. The relative merits of the prosecution and defence cases are considerations that are specifically noted by s 5(2). There is no presumption for or against an award of costs, but such awards are usually only awarded in criminal cases where the prosecution has acted improperly or unreasonably.66 Whether the Crown acted in bad faith is a consideration that goes to the possibility of indemnity costs.67
[59] Of note also is the Supreme Court’s decision in Reid v R, which involved four defendants who were acquitted in the High Court of charges of conspiracy to defraud and money laundering.68 The Court of Appeal had set aside the costs order made in
66 See W (CA447/17) v R [2020] NZCA 283.
67 T v Collector of Customs HC Christchurch AP167/94, 28 February 1995.
68 Reid v R [2007] NZSC 90, [2008] 1 NZLR 575.
favour of the defendants by the High Court under the CCCA.69 On appeal to the Supreme Court, the High Court costs order was restored. The Supreme Court considered that the concern of the majority of the Court Appeal regarding the fiscal impact of costs awards on the willingness of state agencies to prosecute financial offending was misplaced.70 The Court cited the following passage from the Law Commission’s report Costs in Criminal Cases:71
Section 7(1)(a) of the Act provides that where the prosecution is conducted by or on behalf of the Crown, a successful defendant’s costs are met by the Crown through a neutral source, namely, the Department for Courts, out of money appropriated by Parliament for the purpose. This reflects the principle that prosecutions are brought in the public interest and therefore the prosecuting agency should not be inhibited in bringing a prosecution by an adverse inference which might be drawn from an award of costs against it. This provision was recommended by the 1966 Committee because it was concerned that awards of costs would be an expense to the police and thus a source of anxiety and therefore a deterrent to some officers. The provision highlights the intention that the costs are a payment to the defendant not against the prosecuting agency.
(footnotes omitted)
[60] Accordingly, then, it may be said that the possibility of an award under s 5 responds to the compensatory goal that takes a backseat in respect of costs awards pursuant to s 364 of the CPA. This was the interpretation taken by both Woolford J and the Court of Appeal in respect of the plaintiffs’ applications for costs.72
Breach of a statutory duty
[61] The tort of breach of a statutory duty is an accepted tort in New Zealand, however, it has been described as “one of the law’s less certain areas”.73 The tort provides an exception to the starting proposition that a breach of statutory duty does not, by itself, give rise to a private right of action.74 The requirements of the tort are
69 R v Connolly (2007) 23 NZTC 21,172 (CA); and R v Connolly (2006) 22 NZTC 19,844 (HC)
70 Above n 68, at [13].
71 Above n 61, at [95].
72 See Costs Appeal, above n 33, at [37] and [41]; and First Costs Judgment, above n 19, at [86] and [107]. See also McLean v Auckland District Court [2018] NZHC 552, [2018] NZAR 684.
73 Stephen Todd (ed) Todd on Torts (8th ed, Thompson Reuters, Wellington, 2019) at [8.2.05]. [Todd on Torts]
74 X (Minors) v Bedfordshire County Council [1995] 2 AC 633 (HL) at 731.
well-established. As discussed in Todd on Torts, to succeed in an action for breach of a statutory duty, a plaintiff must establish that:75
(a)the statute in question creates a duty enforceable by a private action;
(b)the defendant was subject to the statutory duty;
(c)that duty was owed to the plaintiff;
(d)the statutory duty was breached;
(e)the breach caused the plaintiff loss or damage; and
(f)the loss or damage suffered by the plaintiff was of a kind the statute was designed to prevent.
[62] As accepted by counsel, the critical matter that a plaintiff must establish is that the statute creates a duty enforceable by way of private action.76 It is frequently the case that such an intention is not express in the statute. The court must therefore turn to and apply well-known principles of statutory interpretation, and often infer parliamentary intent. As further stated in Todd on Torts:77
However, in more cases than not, the statutory wording is not particularly helpful one way or the other, and the court is on somewhat less solid ground when it considers the “purpose”, “scheme” or “purview” of the Act, and whether this requires redress in damages for the individual who suffers loss through breach.
[63] The Court of Appeal has noted that “a Court will not lightly imply such a right” and that:78
75 Todd on Torts, above n 73, at [8.2]–[8.3].
76 The modern approach stems from the English Court of Appeal decision in Atkinson v Newcastle & Gateshead Waterworks Co (1877) 2 Ex D 441 (CA) and requires that Parliament intended the Act to confer a civil right of action for its breach: Thompson v Turner Hopkins [2018] NZCA 197 at [14] and [15].
77 Above n 73, at 463.
78 Wool Board Disestablishment Co Ltd v Saxmere Co Ltd [2010] NZCA 513, [2011] 2 NZLR 442 at [188]. The Court of Appeal expressed the same sentiment in Thompson v Turner Hopkins, above n 76, at [16].
… the reviewing Judge must be driven to the view that something is necessary to achieve the purpose of the statute and, therefore, objectively within the intention of the legislature, yet was not provided for.
[64] Whether a cause of action exists will ultimately be a matter of statutory construction in light of all the circumstances.79 This requires the court to adopt the standard approach to interpretation set out in s 10 of the Legislation Act 2019.
[65] The court often also has regard to one or both of the following tests, although neither is conclusive:80
(a)whether the statute was passed for the benefit of an ascertainable class of persons (the ‘class test’); and
(b)whether the statute in question provides expressly for its own enforcement (the ‘alternative modes of enforcement test’).
[66] Todd on Torts identifies other factors that may be considered, although, again, none are conclusive, including:
(a)whether the recognition of a privately enforceable duty would ‘open the floodgates’ to litigation claiming non-feasance by public authorities;81
(b)whether the claimed duty effectively replicates a common law duty under which the defendant was required to take reasonable care;82
79 Select 2000 Ltd v ENZA Ltd [2002] 2 NZLR 367 (CA) at [40], in reliance on Cutler v Wandsworth Stadium Ltd [1949] AC 398 (HL) at 407; EM v Accident Compensation Corporation [2016] NZHC 2535 at [54].
80 Select 2000 Ltd v ENZA Ltd, above n 79, at [43] citing Stephen Todd The Law of Torts in New Zealand (3rd ed, Brookers, Wellington, 2001) at [7.2.3] and [44]. See now Todd on Torts, above n 73, at [8.2.03].
81 Clegg Parkinson & Co v Earby Gas Co [1896] 1 QB 592 (QB). However, this factor has been held to be of lesser importance in a New Zealand context, see MacEachern v Pukekohe Borough [1965] NZLR 330 (SC).
82 See O’Connor v SP Bray Ltd (1947) 56 CLR 464 at 478, in which the High Court of Australia considered that where a statutory provision creates a specific duty in a matter where the defendant is already bound to take reasonable care under the common law of negligence, the statutory duty will readily be held to give rise to an action in damages. See also MA Paterson Ltd v Robertson [1960] NZLR 1160 (SC).
(c)the type of interest that is affected by the breach and whether loss suffered is that for which the law provides recovery;83 and
(d)the nature of the statutory duty and the precision with which it is defined.84
[67] As to loss, a plaintiff must prove on the balance of probabilities that the breach caused their loss or materially contributed to it.85 It is not necessary that a plaintiff show that the defendant was negligent. Liability arises because the defendant has not complied with the relevant statutory duty. Damages recoverable are such as contemplated by the statute and are the natural consequence of that breach.86
[68]I turn now to briefly summarise the parties’ submissions.
The plaintiffs’ submissions
[69] Mr O’Leary, counsel for the plaintiffs, submits that this is a proceeding about ensuring accountability for those acting in an official capacity who were responsible for a serious failure in the criminal trial process. He describes the plaintiffs’ application as an attempt to provide proper redress for the financial, personal, and professional damages they have suffered because of the FMA’s breach of criminal disclosure obligations. He submits that consistent with New Zealand’s international obligations, the plaintiffs are entitled to seek damages by way of private civil action and that they should be awarded the damages they seek.87
[70] Mr O’Leary submits that as the existence of a right of action is a ‘matter of construction’, the interpretation that should be applied to s 13 of the CDA should be influenced by NZBORA, and the principle that fundamental rights cannot be overridden by general or ambiguous words. He says that Parliament cannot be
83 See Todd on Torts, above n 73, at 473.
84 Attorney-General v Daniels [2003] 2 NZLR 742 (CA); and R(G) v Barnet London Borough Council [2003] UKHL 57, [2004] 2 AC 208.
85 See Todd on Torts, above n 73, at 481.
86 At 481.
87 Universal Declaration of Human Rights GA Res 217A (1948), art 8; International Covenant on Civil and Political Rights, GA Res 2200A (XXI) (1966), arts 2 and 11.
assumed to have intended to deprive individuals of the right to bring a private action for breach of a statutory duty where their fair trial rights have been interfered with.
[71] Mr O’Leary submits that Parliament intended to create a private right of action in relation to the CDA. He says that the plaintiffs constitute a limited and ascertainable class of persons, being persons charged with criminal offending. He submits that the CDA does not provide for any alternative mode of enforcement for non-compliance, and that this suggests that a private right of action was intended, as there is no mechanism for ‘real accountability’. He argues that the other factors often considered by the courts favour the plaintiffs.
[72]Mr O’Leary further says:
…the costs awarded [to] the Plaintiffs in the previous criminal proceedings under the CCA 1967 and [the] CPA 2011 are of no, or merely minimal, relevance to the Plaintiff’s current claim for compensatory and other damages for their pain, loss, and suffering resulting from Woolford J”s necessary abortion of the first High Court trial after nine months on 10 May 2017, due to the prosecutions ‘extreme’ breach of its critical pre-trial disclosure obligation – not discretion – under s 13 Criminal Disclosure Act 2008. It is this proposition which essentially underlies the Plaintiffs’ case against the First Defendant.
(emphasis in original)
[73] Mr O’Leary contends that a private remedial action must therefore exist, where there is a lack of evidence to establish that Parliament intended to exclude such an action. He strongly rejects any suggestion that the plaintiffs’ claim is an improper collateral challenge to the previous decisions of the courts that have awarded them costs. Rather, he says that the civil claim is distinct and cannot be described as an attempt to relitigate the costs decisions; damages are in issue in this proceeding, rather than costs.
[74] Mr O’Leary also refers to s 22(1) of the Financial Markets Authority Act 2011, which provides:
22 Protection from liability for FMA and members and employees
(1)The FMA is not liable for anything it may do or fail to do in the course of the performance or exercise or intended performance or exercise of
its functions, powers, or duties, unless it is shown that it acted in bad faith or without reasonable care.
[75] He says that s 22(1) is evidence of parliamentary intent to allow for a remedial private right of action against the FMA for breach of disclosure obligations as a prosecuting agency.
[76] Mr O’Leary relies on the plaintiffs’ evidence to establish that the plaintiffs have suffered loss. He submits that there is a basis for compensatory damages, the purpose of which is to put the plaintiff into the position they would have been had the wrong not occurred. He says also that the standard for exemplary damages is established and that compensatory damages are not sufficient for the purpose of sanction and deterrence of future prosecutorial failings.
The defendants’ submissions
[77] While this cause of action is pleaded only against the FMA, because the second cause of action seeks to hold the Attorney-General responsible for the alleged breach of statutory duty, both defendants made submissions on this issue. They submit that a claim for breach of statutory duty is not available in respect of breaches of the CDA, as Parliament did not intend s 13 to give rise to a private action. They say that to allow the plaintiffs’ claim would be inconsistent with and undermine Parliament’s carefully constructed statutory scheme under the CPA and the CCCA for awards of costs arising out of criminal proceedings. Rather, the CDA contemplates that, together with the two costs regimes, any non-compliance with disclosure obligations was to be addressed within the criminal justice process itself. The defendants also submit that the loss claimed by the plaintiffs is not loss that the statute was designed to prevent. The CDA was not enacted to prevent defendants from suffering financial, emotional, and reputational harm, but rather to improve and promote the fairness and efficiency of the criminal justice system.
Analysis
[78] In terms of the elements of the tort, it was common ground that the FMA was subject to the disclosure duty imposed under s 13 of the CDA and that this duty was owed to the plaintiffs in the context of the criminal proceedings. It is also accepted
that the duty of disclosure was breached in a significant manner without reasonable excuse, albeit inadvertently. Whether the loss claimed by the plaintiffs was caused by the breach of the duty is a contested element of the tort, to which I return below.
[79] The focus of the argument before me was whether the statutory duty of disclosure in s 13 of the CDA confers a private right of action enforceable in damages. It is convenient to incorporate into this discussion the question of whether the loss asserted by the plaintiffs is of a kind the CDA is designed to prevent.
[80] It is accepted by the parties that the CDA itself is silent as to the methods by which it is to be enforced. No point was taken in argument that the alternative enforcement test may only be applied by reference to the particular statute in question, here, the CDA. In my view, it is plainly necessary in this case to understand the statutory regime for disclosure in criminal proceedings by considering each of the CDA, CPA, and CCCA.
[81] As addressed earlier, there is nothing to suggest that Parliament expressly turned its mind at any point in the development of the CDA, CPA, or CCCA to whether a private right of action should exist in response to a breach of disclosure obligations. The parties explain this in opposing ways. The plaintiffs say this shows Parliament did not intend to exclude a private right of action, arguing that if this was Parliament’s intention, it would have said so explicitly. The defendants say that it shows Parliament intended not to provide for such an action.
[82]The legislative context is that Parliament enacted:
(a)the CCCA in 1967, allowing the award of costs in criminal proceedings which has been recognised by the courts as being compensatory in purpose;
(b)the CDA in 2008, creating a regime for criminal disclosure including the obligations set out in s 13 and various powers to allow the court to respond to any breach of those obligations; and
(c)the CPA in 2011, (alongside a significant number of related Amendment Acts) improving and modernising criminal procedure, including the creation of a power to award costs in criminal proceedings under s 364, which has been recognised by the courts as being primarily in the nature of a sanction.
[83] I need to first address the plaintiffs’ argument that as the CPA was enacted three years after the CDA, the CPA can provide no assistance in determining Parliament’s intent in relation to the CDA.
[84] While the timing of the enactment of these statutes is of course indisputable, I do not consider that this argument is determinative. The legislative history of the CDA and the CPA shows that much policy work was undertaken over a lengthy period, all relating to the important matter of New Zealand having a modern, efficient, and fair criminal justice system.88 This appears to have begun with a request by the Ministry of Justice in August 2000 for the Law Commission to provide urgent assistance in accordance with the following terms of reference:89
To simplify the statutory provisions governing the laying of criminal charges and infringement offences and their progress through the court system to the point of determination, including appeals, so as to remove current inconsistencies and introduce more efficient procedures.
[85] There was also the Criminal Procedure (Simplification) Project—established in October 2007 as a joint effort by the Ministry of Justice and the Law Commission
88 See (4 October 2011) 676 NZPD 21637. The CPA and the following other statutes were originally contained within the Criminal Procedure (Reform and Modernisation) Bill, which was divided into 15 separate bills during the Committee of the Whole House: Bail Amendment Act 2011, Corrections Amendment Act 2011, Crimes Amendment Act (No 4) 2011, Criminal Disclosure Amendment Act 2011, District Courts Amendment Act 2011 (subsequently repealed), Evidence Amendment Act 2011, Juries Amendment Act 2011, Justices of the Peace Amendment Act 2011, New Zealand Bill of Rights Amendment Act 2011, Sentencing Amendment Act (No 2) 2011, Summary Proceedings Amendment Act (No 2) 2011, Victims’ Rights Amendment Act 2011, Children, Young Persons, and Their Families Amendment Act (No 2) 2011, and Criminal Procedure (Mentally Impaired Persons) Amendment Act 2011. The Criminal Justice Act 1985 was also repealed.
89 Te Aka Matua o te Ture | Law Commission Simplification of Criminal Procedure Legislation: An Advisory Report to the Ministry of Justice (NZLC SP7, 2001) at [4]. See also Te Aka Matua o te Ture | Law Commission Reforming Criminal Pre-Trial Processes (NZLC PP55, 2004); Te Aka Matua o te Ture | Law Commission Criminal Pre-Trial Processes: Justice Through Efficiency (NZLC R89, 2005); and Te Aka Matua o te Ture | Law Commission Suppressing Names and Evidence (NZLC R109, 2008).
to review and reform New Zealand’s criminal procedure, with a key focus on improving timeliness and efficiency.90
[86] At the third reading for the Criminal Procedure Bill, the responsible Minister, Simon Power, noted:91
I also thank the Ministry of Justice and the Law Commission for their extensive work on this project. As many members of the House will know, this legislation is the culmination of a decade of work by officials, the judiciary, and the legal profession. The legislation brings New Zealand’s criminal procedure into the 21st century. The changes enabled by the legislation will help to build a more resilient court system, further speed up case disposal rates, improve customer service, and enhance the justice sector’s capability to respond to future demands. I commend the bill to the House.
[87] Given this context, I do not accept the plaintiffs’ argument that due to the relative timing of enactment of the CDA and the CPA I may not, in effect, take account of the power to award costs provided in the CPA. I prefer a view that acknowledges the broad law reform history relating to legislative improvements to the operation of the criminal justice system. In my mind, it is appropriate to assess Parliament’s intent in relation to whether the CDA confers a private right of action enforceable in damages for disclosure failures in the context of this broader backdrop.92
[88] I therefore turn to consider the “class” and “alternative means of enforcement” tests, both of which are commonly relied on by the courts in assessing parliamentary intention.
[89] In respect of the class test, it is said that where a statute was passed for the benefit of an ascertainable or limited class of persons, it is more likely to have been intended to be actionable by those persons.93 Or in other words, if a statute was passed primarily for the benefit of the general public, or for some other purpose, such an actionable duty does not arise.
90 (4 October 2011) 676 NZPD 21641.
91 (4 October 2011) 676 NZPD 21637.
92 Section 10 of the Legislation Act 2019 requires the meaning of legislation to be ascertained from its text and in light of its purpose and context.
93 Todd on Torts, above n 73, at 464.
[90] There are some limitations in the analysis required by the class test,94 and I accept that:95
It would be strange if a less important duty, which is owed to a section of the public, may be enforced by action, while a more important duty owed to the public at large cannot.
[91] That critique may be significant in a context where the statutory duty in question bears on rights protected by the NZBORA. While it may be said that the duty is imposed for the proper administration of the criminal justice system and therefore for the general public, it also relates and applies intimately to the limited class of persons prosecuted in the criminal justice system. The Attorney-General submits that although disclosure obligations benefit criminal defendants as a definable class, that because they engage more fundamental rights, they are more likely to be for the benefit of the public at large. However, given the need for individuals to be given “the full measure of the enacted fundamental rights and freedoms, and one which renders the rights practical and effective”, I am reluctant to view duties of this kind for the benefit of the public at large as presumptively non-actionable.96 A similar analysis has been applied even where such fundamental rights were not directly implicated.97
[92] For these reasons, I regard the class test as a neutral factor in the determination of whether Parliament intended to create a private right of action in the present case.
[93] The alternative modes of enforcement test provides that if the statute in question does not itself provide for any penalty or remedy for breach there is a greater likelihood that a right of private action was intended to be created by Parliament. Otherwise, “there is no method of securing the protection the statute was intended to confer”.98 This is again a factor that has a mixed effect. Where there is a method of appeal, review, or enforcement through administrative channels, this points away from an intention to provide a civil remedy, and where the statute is silent, this points towards it.99
94 At 467–469.
95 Phillips v Britannia Hygienic Laundry Co Ltd [1923] 2 KB 832 (CA) at 841.
96 Fitzgerald v R [2021] NZSC 131, [2021] 1 NZLR 551 at [41] per Winkelmann CJ.
97 See MacEachern v Pukekohe Borough, above n 81.
98 X (Minors) v Bedfordshire County Council, above n 74, at 731.
99 Todd on Torts, above n 73, at 470.
[94] The plaintiffs emphasise that they seek damages, not costs. They have already received costs awards under both the CPA and the CCCA. They argue that those costs regimes do not have the effect of enforcing the duty of disclosure under the CDA as loss may be suffered that is not addressed by costs, as in their case.
[95] Central to the defendants’ submissions was the contention that as the plaintiffs have already recovered costs pursuant to two separate costs regimes, Parliament cannot have intended them to also have the benefit of a private right of action for damages. The defendants drew on the application of the CCCA and the CPA in relation to awards made to the plaintiffs, as well as a wealth of material relating to the legislative history of each statute. They submit that Parliament has intentionally provided two modes of enforcement for the situation in which there are significant disclosure failures in the course of a prosecution. They also highlighted that in enacting the CDA, Parliament demonstrated its intention that breaches of disclosure obligations would be dealt with through the criminal trial processes. This is consistent with the purpose of the CDA and its focus on the promotion of fair, effective, and efficient disclosure of relevant information in criminal proceedings.
[96] It is well established that the primary purpose of s 5 of the CCCA is compensation, and that the primary purpose of s 364 of the CPA is compliance and efficiency. The Court of Appeal has been clear in that respect. It is difficult to accept the submission that a private right of action exists for breach of the CDA in light of these purposes. In the event of a significant disclosure failure, an aggrieved defendant can seek compensation via the CCCA towards the costs of their defence, and a further award under the CPA, if it is appropriate to sanction non-compliance. Breaches of the CDA are also able to be managed in the normal course of the proceedings through the usual mechanisms available to a trial judge. In my view, the relevant provisions in the CCCA and the CPA speak to the kinds of loss that the CDA is designed to protect against, and provide strong enforcement measures for the obligations contained in the CDA.
[97] On the other hand, the authors of The Law of Costs in New Zealand comment as follows about the award of costs given to the plaintiffs and their co-defendants pursuant to s 364 of the CPA:100
That resulted in Mr Bublitz (one of five defendants) recovering only $10,000, despite having incurred wasted costs in excess of $1 million as a result of the prosecutor’s failure. It might be argued that this result was an extremely generous one for the Financial Markets Authority in circumstances where, had the proceeding been subject to the civil costs regime, an increased or indemnity costs order might well have been warranted. However, the civil regime is not a relevant consideration to quantum.
[98] I have some sympathy for this view (particularly given that s 364 is directed to sanctioning non-compliance) and similarly consider that the costs awards that the plaintiffs received under s 5 of the CCCA were low, given the extent of the disclosure failures and the effect on the plaintiffs. However, it would not be appropriate to recognise a cause of action which it appears that Parliament did not intend to create so as to facilitate a collateral challenge to awards under the CCCA or the CPA that I may have made differently, had the matter been one for my decision.
[99] If the plaintiffs’ submissions were to be accepted unquestioningly, the plaintiffs are not concerned with costs, but rather, damages for loss suffered as a result of an accepted breach of s 13 of the CDA.
[100] Costs and damages are fundamentally different. Both the civil and criminal costs regimes speak to the costs of participation in litigation. On the other hand, damages in tort perform a different function, by seeking to restore a successful plaintiff to the position they would have been, had a wrong not occurred. That function is not fulfilled by costs awards under the CCCA or the CPA, and nor could it be, given the ways in which discretion is required to be exercised under those regimes, in consideration of the unique criminal context. I accept that it is at least arguable that the existence of the costs recovery regimes under the CCCA and the CPA is not entirely determinative of the issue of parliamentary intent, because the kinds of loss that are recoverable in tort are not the kinds of loss that are provided for under those regimes.
100 David Bullock and Tim Mullins The Law of Costs in New Zealand (Lexis Nexis, Wellington, 2022) at [10.14]; citing Costs Appeal, above n 33, at [49].
[101] However, in the present case I accept the defendants’ submission that the plaintiffs’ claim remains problematic as it concerns the distinction between costs and damages.
[102] The defendants say that the plaintiffs are essentially seeking to recover indemnity costs, plus additional general, special and exemplary damages. The FMA notes that when the proceeding was first filed, each plaintiff sought special damages in the amount of the difference between costs awarded to him and those actually incurred. The FMA expressed its doubts as to that approach and the claims were then amended to remove that head of damages, and to increase the claim for general damages. The general damages are claimed for loss, pain, suffering, distress and anxiety. Mr Blackwood also then made a claim for special damages relating to two years’ lost salary and travel costs.
[103] The FMA submits that this demonstrates that the plaintiffs are attempting an “end run” around the criminal costs regime, masking an indemnity costs claim as a claim for damages as well as effectively relitigating the costs decisions already given. Mr O’Leary does not accept this, submitting that the increase in general damages claimed “reflects an increased appreciation of both temporal extent and the gravity of the intangible loss and suffering of the plaintiffs” (emphasis in original).
[104] I agree that to permit recovery of indemnity costs through a claim in the present case would cut across the costs regime established under the CPA and CCCA, where it is clear that the plaintiffs substantively seek recovery of legal costs they have not yet recouped. Or in other words, I consider that there is no evidence of parliamentary intent to create a private right of action for the recovery of legal costs in circumstances where the CPA and/or CCCA have not enabled an aggrieved defendant to obtain full payment of their costs.
[105] In addition, s 3 of the CDA provides that the purpose of the Act is to promote “fair, effective, and efficient disclosure of relevant information … for the purposes of criminal proceedings”. In my view, this, together with the focus of the Act on remedies that relate to the efficient operation of the criminal process, negates the plaintiffs’ submission that the CDA was intended to prevent damages relating to anxiety, stress
and reputational damage, let alone a claim for special damages relating to lost salary and travel costs. Therefore, on either construction of the plaintiffs’ claim, I am not satisfied that the CDA was intended to prevent loss of the kind claimed by the plaintiffs.
[106] I also accept, as submitted by the defendants, that the existence of established claims in tort for responding to inappropriate use of prosecutorial power such as claims for malicious prosecution and misfeasance in public office, while not pleaded in this case, also operate as important protections which can be understood as consistent with Parliament having no intention to create a right of private action of the nature described by the plaintiffs.
[107] Finally, in my view, the Solicitor-General’s Prosecution Guidelines (the Prosecution Guidelines) and the Lawyers: Conduct and Care Rules 2008 (the Conduct and Care Rules) respectively restate a prosecutor’s obligations to comply with the requirements contained in the CDA and open the alternate possibility of personal sanction for failure to comply through the Law Society’s disciplinary processes. It does not seem to me that Mr O’Leary’s reference to the Conduct and Care Rules or the Prosecution Guidelines affects my analysis of whether a claim in tort exists as pleaded by the plaintiffs nor has the effect of strengthening the plaintiffs’ position.
[108] Overall, then, I do not accept the plaintiffs’ submission that without finding a private right of action for breach of s 13 of the CDA, it can be said there is no mechanism for “real accountability” in relation to the disclosure obligations in the CDA. Rather, accountability is (and was) provided through the operation of each of the CDA, CPA and CCCA. As such, I consider that this is not a case in which the recognition of a private right of action is necessary to ensure that persons in the position of the plaintiffs have the benefit of the protections contained in the CDA. Essentially, there are already methods of securing the protection that the CDA was intended to confer.
[109] For completeness, I now consider other factors that have been identified by the courts as being potentially relevant to assessing whether a private right of action exists and that were addressed (albeit briefly) by the parties.
[110] The first factor is whether recognition of a privately enforceable duty in this case would open the floodgates to litigation claiming damages for breach of disclosure obligations. I doubt it would.101 The vast majority of disclosure breaches are able to be managed by a trial judge within the conduct of the trial and, if necessary, interlocutory applications for the exclusion of evidence or even the abortion of trial. Although the tort of breach of a statutory duty is a strict liability tort, if a private right of action did exist, something more than a minor failure to comply with the CDA would be necessary to give rise to a successful claim. As submitted by Mr O’Leary, a plaintiff would have to satisfy a Court that they have suffered losses caused by or materially contributed to by a significant prosecution disclosure failure and that the loss was of a kind the statute is designed to protect against. I have already concluded above that the losses claimed by the plaintiffs are not such losses.
[111] Likewise, it is arguable that the recognition of the private right of action asserted by the plaintiffs in this case would not have an unnecessarily chilling effect on the willingness of Crown agencies to file charges and prosecute criminal offending. Agencies such as the FMA have a legislative responsibility to fulfil their functions. If that includes a duty to prosecute criminal offending, then such agencies must do so where they believe that there is an evidential basis for a prosecution, and it is in the public interest to do so. When any public body pursues a prosecution, they are required to comply with the law pertaining to the conduct of that prosecution. That includes compliance with the rules of disclosure. That is not a soft obligation. Public prosecutions should be conducted with the utmost regard for procedural compliance.
R v Mills [1999] 3 S.C.R. 668 at [5].
137 King v Attorney-General, above n 109, at [163]; citing Henry, above n 110, at [31].
138 King v Attorney-General, above n 109, at[199]–[204].
139 Fitzgerald, above n 111.
prosecutor to consider s 9 when deciding to prosecute Mr Fitzgerald for a third strike offence. Ellis J observed that in addition to the claim founded on s 22, Mr Fitzgerald could rely on the breach of s 9 and, as suggested by Henry, then seek damages to compensate him for the detention that was a direct and foreseeable consequence of that breach.140
[166] Ellis J noted that Henry was also relevant for its confirmation that “there is a material difference—in terms of the courts’ readiness to intervene—between a case involving a prosecutorial duty (such as the duty to make disclosure) and one concerned with the exercise of prosecutorial discretion, strictly so called”.141 Her Honour went on to conclude that:142
…although judicial restraint continues to be appropriate in most cases where the Courts are asked to review the exercise of prosecutorial discretion, the obligation to consider s 9 and to act consistently with it was not a matter of discretion.
[167] In none of these three judgments was there a discussion of the approach taken in the minority judgment in Henry or an exploration of the question of which approach was preferable in terms of the overall scheme of New Zealand law. I am not bound by those decisions, nor (respectfully) by the view of the majority of the Canadian Supreme Court.
[168] For the reasons I will now set out, I consider that the minority’s approach better aligns with existing New Zealand law, and that the majority’s approach should not be adopted in New Zealand in the absence of a clear and justified analysis as to why that should be the case.
[169] In order to illustrate why I prefer the minority approach it is necessary to return to King and Fitzgerald. Both cases concerned rights that are considered to be absolute; ss 25 and 9 of the NZBORA. Such rights are unable to be justifiably limited. In other words, the relevant actors in the criminal process have a constitutional obligation to
140 Ellis J observed that in the end, she was not sure that it matters much which route is followed, see at [61].
141 Fitzgerald, above n 111, at [84].
142 At [169(d)].
ensure that defendants receive a fair trial and are not subjected to torture or cruel treatment.
[170] In the application of the Henry majority approach in King, Ellis J considered that Mr King’s claim could not succeed because it could not be shown that the police had intended to withhold the information in question, but rather had provided it as soon as it was requested by defence counsel.143 The fact that the files were not disclosed until they were sought was a function of the disclosure regime in operation at the time.144 Further, it was not really a case of non-disclosure, because as a matter of fact the relevant disclosure was made.145 The police had complied with their obligation to ensure that the defence was provided with all the relevant materials, although the intention requirement represented a further hurdle for Mr King.
[171] In Fitzgerald, however, it was accepted that the Crown prosecutor had not considered s 9 when making the decision to prosecute Mr Fitzgerald, as they were required to do. Where a grossly disproportionate sentence was the foreseeable and likely result of laying a particular charge, there was a duty to prefer a different charge.146 The Crown prosecutor did not comply with that obligation.
[172] However, there was no suggestion that this failure was required to be intentional so as to give rise to an action in damages (nor can an omission of this kind be considered to be ‘intentional’). Imposing such a requirement in Mr Fitzgerald’s case would have effectively required him to prove that the Crown had acted in bad faith or with malice. That is an appropriate outcome in circumstances that concerned a failure to comply with an obligation to do something to uphold a right protected by the NZBORA, which is unable to be justifiably limited, in relation to a legal obligation strengthened by other sources of domestic and international law.
[173] Given that the right to a fair trial under s 25 is an absolute right, and the Crown’s disclosure obligations bear upon that right, where those obligations are breached in a significant fashion without reasonable excuse, it should not be necessary
143 King v Attorney-General, above n 109, at [199].
144 King v Attorney-General, above n 109, at [199(f)].
145 At [200].
146 Fitzgerald, above n 111, at [97].
to show that the prosecution intended to withhold the information. Respectfully, I can see no principled reason to impose an intention requirement in relation to actions for damages based on significant disclosure failures, given the effect of such failures on s 25 rights, where the law does not impose a similar requirement in respect of a failure by the prosecution to consider the effect of a particular charge on a right of the same character. Neither matter involves the exercise of real discretion, but are rather legal obligations.
[174] In any prosecution, the Crown is under a legal obligation to comply with disclosure requirements. That obligation is strengthened by its inclusion in the Prosecution Guidelines. The only discretion the Crown retains in relation to disclosure is limited in the manner described by the minority in Henry, as noted earlier. Likewise, in Fitzgerald, the Crown prosecutor was under a legal obligation to consider s 9 before proceeding with the prosecution. To apply a different threshold in respect of the two different rights appears to me to be both contradictory and inconsistent with the need for individuals to be given the full and effective exercise of their fundamental rights.
[175] It is not apparent from the three judgments discussed whether their Honours considered that the majority’s approach in Henry was more appropriate for any particular reason. However, if their adoption of the majority’s approach was based on the view that to not include an intention requirement would unduly fetter prosecutorial discretion, and give rise to a flood of claims, I consider, like the minority in Henry, that view is overstated. Particularly, I consider that:
(a)prosecutorial discretion in respect of disclosure is limited and controlled by a trial judge;
(b)an action for breach of disclosure obligations is an action for breach of a legal duty imposed both by the CDA and the NZBORA, from which liability arises;
(c)good governance and the rule of law is strengthened when the Crown is held to account for failing to meet the obligations imposed by the NZBORA; and
(d)the imposition of an intention requirement is not necessary to avoid a chilling effect on the exercise of prosecutorial discretion or the erosion of the high threshold inherent in the tort of malicious prosecution, as the high threshold remains in respect of those actions, which concern real exercises of discretion.
[176] I note also that in a rights-based action, it is the mere fact that information is withheld that is causative of harm to the right to a fair trial. Once the policy justifications for the imposition of an intention requirement fade away, one is left with an action for unlawful interference with fundamental rights. The imposition of an intention requirement would be contrary to the effective fulfilment and exercise of rights by individuals.
[177] In my view, the claim in King would still fail when applying this approach, because Mr King could not show that there had in fact been non-disclosure. As for Clayton, as a result of applying this approach, the claim would have progressed to the stage of considering whether public law damages should be available and awarded in the particular case. Churchman J addressed those matters and concluded that such damages, if they were available, should not be awarded. In those circumstances, the removal of the intention requirement would appear to have made no difference to the result.
[178]I therefore conclude that it is appropriate to adopt the minority approach in
Henry in considering the plaintiffs’ claim for public law damages.
[179]In my view, this requires a plaintiff to show that:
(a)the prosecutor withheld information (this requires that a plaintiff prove a prosecutor was in possession of the information and failed to disclose it, whether or not this was intentional or inadvertent);
(b)the prosecutor knew or ought reasonably to have known that the information was material to the defence (“directed to some matter in
the case”) and that the failure to disclose would likely impinge on their ability to bring a defence;
(c)withholding the information breached their rights under the NZBORA; and
(d)they suffered harm as a result (on the basis of a ‘but for’ test).
[180] It follows then that I consider that the plaintiffs have satisfied the first two requirements. It is accepted that there were significant failures by the prosecution to comply with its disclosure obligations. This Court has already concluded that the disclosure issues should have been identified and determined at a much earlier stage than they were.147 I once again acknowledge that there was no bad faith on behalf of the Crown and that the disclosure failures were inadvertent. That, however, cannot change the fact that the failures were significant and without reasonable excuse.
(c) Did the disclosure failures breach the plaintiffs’ fair trial rights, including the right of trial without undue delay?
[181] The Attorney-General did not accept that the plaintiffs’ fair trial rights had been infringed. The Attorney-General says that any real possibility of unfairness was eliminated by the abortion of the first trial, the fact Mr Morrison was not retried, and the fact that Mr Blackwood’s rights were upheld at his second trial and on appeal. Against that, the plaintiffs appeared to allege that the unfairness to which they were subject pervaded their entire engagement with the criminal justice system.
[182] I find neither of these positions particularly appealing. The criminal justice process contains many safety valves to guard against the possibility of miscarriages of justice, but the fact that such a safety valve (for example, prosecutorial discretion, or a successful appeal) operates as it should, cannot operate to entirely vindicate public actions that infringe fair trial rights. I accept Mr O’Leary’s submission that the avoidance of a miscarriage of justice is not necessarily always the same as the vindication of a right.
147 Third Stay Judgment, above n 7, at [71].
[183] The original trial was aborted because there was reasonable apprehension of a miscarriage of justice in the circumstances. There was a real possibility of unfairness. That is different from a finding that a miscarriage of justice had occurred. It is also clear that a finding of a miscarriage of justice (or a potential one) does not automatically result in an infringement of the NZBORA or in other words, not every departure from best practice makes a trial unfair.148 There must be a consequence of action or inaction by someone exercising a public function that has that effect. It may still be entirely possible to ensure that a person has a fair trial. In his Honour’s reasons for aborting the first trial, Woolford J considered that:
(a)the abortion of a trial is an “extreme remedy”,149 which requires a real risk or danger of an unfair trial,150 and a finding that non-disclosure gave rise to prejudice which was more than negligible.151
(b)the defence was unable to present their case in a way that they otherwise might have done;152
(c)a long trial does not result in a miscarriage of justice, unless the length has the effect of making it unfair;153
(d)the volume of late disclosure was unprecedented;154
(e)disclosure impacts the overall presentation of the defence case, what documents are used and cross examination;155
(f)a lengthy adjournment at that stage would have had a prejudicial effect on the right of the defendants to present an effective defence;156 and
148 R v Condon, above n 118, at [78].
149 Trial Abortion Reasons Judgment, above n 15, at [37].
150 At [45].
151 At [48].
152 At [45].
153 At [53].
154 Trial Abortion Reasons Judgment, above n 15, at [66].
155 At [58]–[61].
156 At [106].
(g)the disclosure breaches had restricted the choices open to the defence in respect of the presentation of their case in manner and extent.157
[184] It seems to me then that the plaintiffs’ rights pursuant to ss 24(d), 25(e), and s 25(f) of the NZBORA were breached in the first trial as a result of the prosecution’s failure to comply with disclosure obligations. The plaintiffs did not have adequate time and facilities to prepare their defence, and nor were they able to examine witnesses under the same conditions as the prosecution. Had they had full disclosure, there would have been alternative ways for them to present their defence, the choice of which they did not have.
[185] A defendant has the right to decide how they wish their case to be run on the full documents they are entitled to use.158 Fundamentally, the plaintiffs were deprived of the right to possess and review all available and relevant information in the possession of the prosecution. That appears to be a breach of significant constituent rights that underlie the right to a fair trial. As noted by Woolford J, the disclosure failures were unprecedented, and the prosecution compounded by needless complexity. These factors resulted in the abortion of a nine-month criminal trial. In Mr Morrison’s case, given the Crown chose not to proceed against him at the second trial, the abortion of the first trial deprived him of the opportunity to present any defence to the allegations against him. This is a particularly difficult factor, when latterly he faced criticism in the context of seeking costs that he had not proved his innocence or sought a discharge on the basis of evidential insufficiency.159
[186] I consider Woolford J’s finding that unfairness was likely to result if the first trial continued is helpful to the plaintiffs’ submission that unfairness in fact occurred. Given my finding that three of the constituent rights have been breached, the onus shifts to the Crown to show that the trial itself was otherwise substantively fair.160 As noted, the Attorney-General’s position was both that the plaintiffs’ rights were not breached and also that any possibility of unfairness was eliminated by the abortion of
157 At [106].
158 Garraway v R [2014] NZCA 67 at [31]–[32].
159 Costs Appeal, above n 33, at [55].
160 R v Condon, above n 118, at [83].
the first trial. He said that no prejudice actually materialised, and the plaintiffs’ rights to present an effective defence were never hindered. I disagree.
[187] It is my view that the plaintiffs’ rights to present an effective defence were hindered. I do not consider it is sufficient for the Crown to rely on the fact the trial itself was aborted to say that the plaintiffs’ fair trial rights were never breached and also contend that their rights were vindicated by abortion of the trial. On this point the Attorney-General said effectively that Mr Morrison was never tried at all. In my view, that is not correct. Both Mr Morrison and Mr Blackwood were tried, over a period of nine months, without the ability to present an effective defence, until a point at which it was considered unsafe to continue.
[188] I consider that the fact that the trial itself was aborted is a matter that in this case also goes towards the question of whether damages are the only available effective remedy for the vindication of the plaintiff’s rights. Not every matter that requires the abortion of a trial will also constitute a breach of a defendant’s fair trial rights. However, I also consider that if a trial is aborted, there must still be a possibility of a finding that a defendant’s fair trial rights were in fact breached. A criminal defendant’s fair trial rights can still be considered to have been breached regardless of whether the system itself eventually moves to correct the error for example through the abortion of a trial. Then, there is the separate question of whether damages are appropriate to vindicate those rights.
[189] The Attorney-General’s submissions in respect of whether the plaintiffs’ fair trial rights had been breached relied almost solely on the contention that the abortion of the trial vindicated the possibility of unfairness. I have addressed that argument. The Attorney-General then argued that the level of disclosure failures itself was not sufficient to give rise to a finding that the plaintiffs’ fair trial rights had been breached. Again, I disagree. The extent of the disclosure failures (although inadvertent) was unprecedented. The fact that Woolford J was unable to conclude whether any individual documentation could be said to have made a difference on its own was not an admission that those documents ultimately had no relevance, but rather a recognition that the magnitude of the disclosure failures was so great that at that point he was unable to make such findings in the time available. On those bases, I consider
that the Crown has been unable to dispel the onus of establishing that the original trial was substantively fair. Accordingly, I consider that the plaintiffs’ fair trial rights were in fact breached.
[190] As to the allegation of undue delay, New Zealand courts have generally referred to the approach adopted by the Canadian Supreme Court in R v Morin, in which the relevant considerations are:161
(a)the length of the delay;
(b)waiver of time periods;
(c)the reasons for the delay, including:
(i)the inherent time or requirements of the case;
(ii)the actions of the accused;
(iii)the actions of the Crown;
(iv)limits on institutional resources; and
(v)any other reasons for the delay; and
(d)prejudice to the accused.
[191] When this Court dealt with the application for stay of proceedings in September 2017, Lang J concluded that there had been undue delay in the plaintiffs’ criminal proceedings:162
This brings me to the disclosure issues that ultimately caused the trial to be abandoned. The delay that these have caused is undoubtedly undue because those issues ought to have been identified and determined at a much earlier stage. The Crown must bear sole responsibility for that. The Court would have
161 R v Morin [1999] 1 SCR 771 (SCC); see also Williams v R, above n 121.
162 Third Stay Judgment, above n 7, at [71]. However, I note also that Lang J concluded that the delay, although unjustified, was not so inappropriate to justify a permanent stay of the proceedings, and that a fair trial remained possible.
a responsibility to provide the parties with a next fixture as soon as they are ready for that to occur. Assuming a new trial could be concluded by the third quarter of 2018, the disclosure issues will have caused an unjustifiable delay of approximately nine to twelve months.
[192]While Lang J dismissed the application for stay, he went on to observe that:163
… any delay can be remedied by alternative forms of relief depending on whether the defendants are ultimately acquitted or convicted. As the approach in Williams demonstrates, a reduction in sentence is an available option upon conviction whilst monetary compensation is a possibility in the event of an acquittal.
[193] In sentencing Mr Blackwood and two of his co-defendants, Mr Bublitz and Mr McKay, Toogood J acknowledged the implications of the undue delay and what he described as a “significant punitive element in the way the prosecution had been undertaken”, applying a 30 per cent discount to recognise this as a mitigating factor.164 In the context of the conviction and sentence appeals by Mr Blackwood and his co- defendants, the Court of Appeal addressed whether Mr Bublitz’s right to trial without undue delay was breached to the extent that the prosecution ought to have been stayed.165 The Court agreed with Lang J that a stay was not warranted.166 However, the Court also concluded that the discount for delay allowed in relation to Mr Bublitz’s sentence was appropriate, characterising this as a remedy for the breach of his right to be tried without undue delay.167 It seems likely that the Court would have taken a similar approach to Mr Blackwood, although that was unnecessary as the Court granted his conviction appeal.
[194] In respect of Mr Blackwood, I find that he has suffered undue delay. While Mr Blackwood was not remanded in custody during this time, I consider that given the sole responsibility for the abortion of the original trial must fall upon the Crown, that the Crown must also be responsible for the roughly 12 month delay between the abortion of the first trial and the start of the second. That delay was both unjustifiable and undue, notwithstanding the burden on the prosecution in terms of the amount of
163 At [73]. The Court of Appeal agreed with Lang J, see Conviction Appeals Judgment, above n 16, at [43].
164 Sentencing Judgment, above, n 26 at [90]–[92].
165 Conviction Appeals Judgment, above n 16.
166 At [44].
167 At [165].
documentation, because this delay was the result of the significant and unprecedented disclosure failures by the prosecution.
[195] The length of the delay was significant. The right to trial without undue delay is directed to the time that elapses between arrest and final disposition, including any appeal.168 The second trial started over four years after the original charges were filed, and two years after the beginning of the first trial, and one year after the abortion of the first trial. Mr Blackwood’s appeal was not determined until 16 August 2019, over five years after the filing of charges. The plaintiffs had no role in the cause for the delay, and Mr Blackwood remained subject to the criminal process throughout that time. Although the beginning of the first trial was delayed by difficulties experienced by Mr Bublitz in retaining counsel, the delay between the first and second trial was solely the responsibility of the Crown. That delay is the focus of the present case. Accordingly, I conclude that Mr Blackwood’s right to be tried without undue delay was breached.
[196] As the remaining charges against Mr Morrison were dismissed a short time after the first trial, I do not consider that the same analysis applies to him. I conclude that his right to be tried without undue delay was not breached.
(d)Availability of public law damages in the present case
[197] In the event that a right protected under the NZBORA is unjustifiably breached, public law damages are a discretionary remedy that is available to the court. Because an action for NZBORA damages is a public law action, public law considerations are relevant, particularly the existence of other more appropriate remedies. The leading authority on NZBORA damages is the Supreme Court’s decision in Taunoa v Attorney- General.169 The broad focus of the Court on when a question of NZBORA damages arises is whether monetary compensation is necessary to vindicate the breach effectively and proportionally.170 The dual focus of NZBORA damages is
168 Williams v R, above n 121, at [10]; citing Darmalingum v The State [2000] 1 WLR 2303 (PC) at 2309 and Martin v Tauranga District Court [1995] 2 NZLR 419.
169 See Taunoa v Attorney-General, above n 114; Baigent’s case, above n 114; and the summary in
Dotcom v Attorney-General [2018] NZCA 220, [2018] NZAR 1298 at [30].
170 Taunoa v Attorney-General, above n 114, at [106] per Elias CJ; [364]–[365] per McGrath J; [232] per Blanchard J; and [300] per Tipping J. See also Fitzgerald, above n 111, at [124].
compensation to a person who has had their rights breached, and to ensure compliance. It is also the case that any remedy must be directed to the values underlying the right which has been breached.171
[198] The plaintiffs say that an award of public law damages is necessary to vindicate their rights. The Attorney-General says that their rights have already been sufficiently vindicated by the regular operation of the criminal process, as a result of the abortion of the trial, the decision not to retry Mr Morrison, and Mr Blackwood’s eventual acquittal.
[199] I accept that in many cases error correction within the process itself will be regarded as sufficient vindication of the wrong. Damages are an exceptional remedy. I note also that there has been some division at both High Court and Court of Appeal level as to whether damages are available for a breach of fair trial rights.
[200] The Court of Appeal in Attorney-General v Upton awarded such damages, having dismissed an appeal against that award by the Crown.172 The Court of Appeal did not address the policy arguments against the availability of damages for fair trial rights, simply noting:173
We accept that Mr Upton’s breaches of the obligations arising from his sentence called for a penalty. But in the determination of that penalty, he had rights which were not accorded. The exercise of the rights might have made a difference. We can see no sufficient basis for upsetting the decision to award compensation or to reduce the amount although in our view it is a rather generous amount. There is certainly no reason to increase it.
[201]In light of that decision, Glazebrook J considered in Brown v Attorney-General
that:174
It would not be open for me, in the light of the Court of Appeal's decision in Upton v Green, to uphold the Crown's submission that compensation is not available for breaches of rights during trial. While the point was not specifically argued in Upton v Green, it is nevertheless a decision of the Court of Appeal where compensation was granted for breach of trial rights. Any reversal of that position is for the Court of Appeal.
171 Taunoa v Attorney-General, above n 114, at [367] per McGrath J.
172 Attorney-General v Upton (1998) 5 HRNZ 54 (CA).
173 Attorney-General v Upton, above n 172 at 61.
174 Brown v Attorney-General [2003] 3 NZLR 335, (2003) 7 HRNZ 100 (HC) at [116].
[202] Having rejected the claim for breach of the NZBORA, the majority of the Court of Appeal in Brown v Attorney-General did not address the proper approach in respect of damages for breach of fair trial rights.175 They instead stated:176
We express no view as to when (if ever) compensation or financial relief would be an appropriate remedy for breach of “fair trial” rights. We also express no view as to how compensation should be measured in this area, assuming the compensation remedy to be appropriate. How remedies for breaches of the Bill of Rights should be synthesised with existing causes of actions, such as malicious prosecution and false imprisonment at common law, and their remedies, will require careful development case by case. We prefer to leave those difficult questions to cases where the resolution of them would have a practical consequence for the parties.
Having said that, we acknowledge the strength of the views expressed by William Young J in his separate judgment at [126]–[142].
[203] The issue therefore remained undetermined as far as the majority was concerned. In his dissenting judgment, William Young J provided an alternate view, specifically that it would be wrong to allow damages related to fair trial breaches. His reasons for this were:177
(a)overseas systems typically do not award such damages;
(b)New Zealand has a reservation in respect of art 14.6 of the ICCPR (which creates an obligation to compensate people who have been the subject of a miscarriage of justice);
(c)the degree of uncertainty and waste of resources through litigation involved in claims for damages arising out of unfair trials outweighs the injustice to the “rare” individuals who will deserve damages;
(d)the availability of damages may affect the proper approach to the application of criminal procedure rules to the ultimate detriment of all criminal accused;
175 Brown v Attorney-General [2005] 2 NZLR 405, (2005) 7 HRNZ 751 (CA).
176 At [100]–[101].
177 See Andrew Butler and Petra Butler The New Zealand Bill of Rights Act: A Commentary (2nd ed, Lexis Nexis, Wellington, 2015) at [27.10.24].
(e)damages for unfair trials would create an unfair and unauthorised burden on taxpayers; and
(f)the natural remedies for breach of fair trial rights are trial-related remedies, such as appeals.
[204] I accept that there is some merit in that approach but note also that leave to appeal to the Supreme Court in Brown was denied.178 The Supreme Court considered that an issue as to the availability of damages for breach of fair trial rights did not arise, stating:179
We are satisfied that no point of general or public importance arises on the proposed appeal and that there is no basis for considering that any substantial miscarriage of justice may have occurred. Although denial of funding to obtain access to expert assistance in the preparation of a defence may raise important questions about trial fairness which it would be appropriate for this Court to consider in an appropriate case, those questions do not arise on the present proposed appeal.
[205] Following Brown, there has not been resolution of this issue from either the Court of Appeal or Supreme Court. However, in the Clayton v Currie proceedings, Priestley J noted that the issue was yet to be determined,180 and Churchman J adopted William Young J’s reasoning and was not prepared to extend the availability of damages “in a case of this nature”, being an allegation of breach for fair trial rights. Churchman J went on to express his view, in case he was wrong the availability of damages for a breach of fair trial, concluding that if damages are available, they would be moderate and awarded only in exceptional cases and to mark egregious behaviour.181 I accept the merit in that view.
[206] However, absent clear appellate indication that is the case, I am reluctant to presume that an award of damages is unavailable to the plaintiffs. I consider that the more fundamental question is whether damages are the only remedy that would appropriately vindicate the breach of their rights. I also expect that the higher courts are unlikely to conclude that damages are unavailable in respect of breaches of fair
178 Brown v Attorney-General [2005] NZSC 59, (2005) 8 HRNZ 1.
179 At [3].
180 Clayton v Currie [2013] 1 NZLR 263 (HC).
181 Clayton v Currie [2018] NZHC 1898 at [211]–[225].
trial rights given those rights are absolute, and the necessity for individuals to be given the full and effective measure of their fundamental rights.
[207] Given the exceptional nature of aborted first trial, the length of time over which the disclosure failures affected the plaintiffs’ ability to present an effective defence, the failure of the Crown to otherwise show that the first trial itself was substantively fair, and the accepted impact on the plaintiffs, I consider that a moderate award of damages is necessary to provide effective redress for the breach of the plaintiffs’ rights. In my view, this is an exceptional case that requires such vindication.
[208] I have considered the sums awarded for NZBORA damages in other cases but note that it is well established that each case must be assessed on its merits. Acknowledging my findings as to undue delay, I consider that appropriate awards for the purpose of vindicating the plaintiffs’ rights in this proceeding are:
(a)$10,000 to Mr Morrison; and
(b)$15,000 to Mr Blackwood.
Conclusion: third cause of action succeeds
[209] In my view, the resolution of the proceedings within the criminal justice system has not sufficiently vindicated the plaintiffs’ rights. The plaintiffs are entitled to the full measure of their absolute and fundamental fair trial rights. They did not receive these at the original trial and in addition, Mr Blackwood suffered a breach of his right to be tried without undue delay.
[210] As recorded above, I have concluded that an award of damages is required. The plaintiffs did not seek a declaration as to the breach of their rights. I consider that given the award of damages, it is also necessary to make declarations as to breach.
Result
[211]For the reasons above, I make the following orders:
(a)A declaration that the Attorney-General has breached Mr Morrison’s and Mr Blackwood’s right to a fair trial;
(b)A declaration that the Attorney-General has breached Mr Blackwood’s right to trial without undue delay;
(c)As against the Attorney-General:
(i)Damages in the sum of $10,000 payable to Mr Morrison; and
(ii)Damages in the sum of $15,000 payable to Mr Blackwood.
Costs
[212] The FMA and Attorney-General have been successful in relation to the first and second causes of action. The plaintiffs have been successful as against the Attorney-General in relation to the third cause of action. Apportionment of costs between the parties to recognise the matters on which each were successful will be required.
[213] If the parties are unable to agree to costs, they may file memoranda of no more than five pages plus a schedule within fifteen working days of the date of this judgment, with a further five working days to file any brief replies required. Costs will then be determined on the papers.
McQueen J
Solicitors:
Richard Beca, Auckland for Plaintiffs
Financial Markets Authority, Auckland for First Defendant Crown Law Office, Wellington for Second Defendant
- AGLC
- Morrison v Financial Markets Authority [2022] NZHC 1654
- Case
- [2023] NZHC 1654
- Decision Date
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