Ngāti Te Ata v New Zealand Steel Mining Limited
[2015] NZCA 547
•17 November 2015 at 2.15 pm
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA421/2014 [2015] NZCA 547 |
| BETWEEN | NGĀTI TE ATA |
| AND | NEW ZEALAND STEEL MINING LIMITED NEW ZEALAND STEEL LIMITED THE HONOURABLE DAVID BUTCHER THE MINISTER OF ENERGY THE ATTORNEY-GENERAL |
| Hearing: | 28 October 2015 |
Court: | Randerson, Miller and Kós JJ |
Counsel: | J V Ormsby and S A Woods for Appellant |
Judgment: | 17 November 2015 at 2.15 pm |
JUDGMENT OF THE COURT
AThe appeal is dismissed.
BNgāti Te Ata must pay the first respondent costs as for a standard appeal on a band B basis.
____________________________________________________________________
REASONS OF THE COURT
(Given by Miller J)
Introduction
Ngāti Te Ata appeals from a High Court judgment in which Fogarty J released New Zealand Steel Mining Ltd (New Zealand Steel) from an undertaking not to mine four blocks of land at Maioro pending the hearing of Ngāti Te Ata’s counterclaim in a proceeding commenced in 1990.[1]
Narrative
[1]Undertakings to the Court by New Zealand Steel Mining Ltd, New Zealand Steel Ltd and the Crown, recorded in New Zealand Steel Mining Ltd v Butcher HC Auckland M1276/90, 14 November 1990 [Minute of Tompkins J].
Maioro is an area of some 1,497 ha of land[2] on the Awhitu Peninsula at
Te-Pūaha-o-Waikato, the mouth of the Waikato River. It is part of the ancestral lands of Ngāti Te Ata. It includes four blocks — Te Papawhero, Waiaraponia, Te Kuo and Tangitanginga — that Ngāti Te Ata says are wāhi tapu; they are culturally and spiritually significant. They are said to contain buried human remains or kōiwi.[2]The area given here is the metric equivalent of the 3,700 acres subject to the New Zealand Steel licence.
The Crown holds title to Maioro. It acquired most of the land in the aftermath of the New Zealand Wars. The land was confiscated on the disputed ground that Ngāti Te Ata had been in rebellion but the Crown changed its stance. The four blocks were returned to Ngāti Te Ata in 1865. In 1867 the Crown purported to purchase Maioro, excluding the wāhi tapu areas, by way of the Waiuku No 3 Deed.
Decades later the Crown acquired the four blocks compulsorily under the Public Works Act 1928. The blocks were mostly planted in trees in the 1930s and 1940s.
The Crown later set Maioro, including the four blocks, aside for mining under the Iron and Steel Industry Act 1959.
In 1966 the Crown granted a mining licence under which New Zealand Steel mines the area for ironsands on payment of a royalty. The licence has a term of 100 years. It includes the four blocks, which comprise some 305.5 ha or about
20 per cent of the licence area. The forest remains. It is known as the Waiuku State Forest and it is administered by Crown Forestry, which is responsible for removing trees and other vegetation in any given area before mining can commence.Ngāti Te Ata feels a strong sense of grievance about the Crown’s conduct. It has long fought to regain ownership of Maioro, and in particular the four blocks. The Crown acknowledged that the grievance is legitimate. In 1990, following the unearthing of kōiwi during mining operations and a resulting picket of the mine, it signed a memorandum of understanding that envisaged that the four blocks would be excised from the licence.[3]
[3]We express no view about the memorandum’s legal effect, which remains to be determined.
When New Zealand Steel learned of the memorandum of understanding it brought an application for judicial review against the then Minister of Energy and moved for interim relief. The interim relief hearing was averted when, on 14 November 1990, New Zealand Steel undertook not to mine the four blocks pending “final resolution of these proceedings” and the Crown gave a reciprocal undertaking that it would not remove them from the licence in the interim.[4]
[4]Minute of Tompkins J, above n 1.
Ngāti Te Ata had been served with the proceeding. After the undertakings were given it filed a defence and a counterclaim against the Minister and New Zealand Steel. Its position was that the Crown acted unlawfully when it took the Maioro lands, including the four wāhi tapu blocks, used them as a state forest, and set them aside for mining under the Iron and Steel Industry Act 1959. It sought to quash these decisions so far as they affected the four blocks and sought orders or declarations that would have the effect of returning the wāhi tapu and all rights associated with them, including mineral rights.
When the undertakings were given the parties contemplated that the substantive application would be heard within months. A fixture was set for April 1991. But the application was never heard. In June 1991 the parties, who by then included Ngāti Te Ata, agreed to adjourn it indefinitely pending negotiations.
For reasons that are controversial but not presently relevant, settlement negotiations have never been concluded. During the intervening 24 years it appears that New Zealand Steel has complied with its undertaking.[5]
[5]It appears to be common ground that tailings have been dumped at Tangitanginga, but evidence filed in 1990 suggests that was done before the undertaking was given. Ngāti Te Ata says that there has also been mining there. We need not resolve any dispute there may be about the fullness of New Zealand Steel’s compliance with the undertaking. The important point for present purposes is that Ngāti Te Ata still has a substantial position to preserve.
New Zealand Steel still wants to mine the four blocks. Its position is that it needs them to exploit its licence fully, and for reasons of efficiency and expense it will need to mine in the near future. It says that it will mine in accordance with a protocol called the Maioro Kōiwi Protection Plan that was agreed with a Ngāti Te Ata representative in 1998. It is said — controversially — that
Ngāti Te Ata developed the protocol and agreed to the blocks being mined under its conditions. The protocol establishes procedures to protect any archaeological sites or taonga found. Any kōiwi are likely to be dispersed burials, and they will be reinterred in accordance with Ngāti Te Ata tikanga. New Zealand Steel says that recent surveys have identified few, if any, archaeological sites in the four blocks apart from a known urupā that is already excluded from the licence, and it claims that the protocol sufficiently protects Ngāti Te Ata’s spiritual and cultural interests.The Crown acknowledges that Ngāti Te Ata has historical grievances under the Treaty of Waitangi and says it is committed to protecting Ngāti Te Ata’s cultural and traditional interests at Maioro. It says that over the years it has made offers that would have entailed return of the land, including the four blocks, together with financial and cultural redress. For its part, Ngāti Te Ata has found those offers unrealistic. Barriers to an overall settlement appear to include acknowledgements of wrongdoing when the land was taken and compensation for royalties that the Crown receives under the mining licence.
In December 2013 a corporate representative of Ngāti Te Ata, Te Ara Rangatū o Te Iwi o Ngāti Te Ata Waiōhua Inc, brought a new proceeding against the Crown. The claim covers the same ground as the 1990 counterclaim — notably, it seeks return of the wāhi tapu blocks, alleging that they were taken unlawfully — but it is more extensive; it alleges that the Crown holds all of Maioro on constructive trust and claims an accounting for all revenue derived by the Crown from Maioro over the years. New Zealand Steel has recently become a party to that proceeding, which is to be heard in the High Court at Auckland on 26 April 2016. We were given to understand that it will now be heard with Ngāti Te Ata’s counterclaim in the 1990 proceeding. The Crown has suspended Treaty negotiations with Ngāti Te Ata in the interim.
The Crown has also changed its mind about excising the four blocks from the licence at this time. That decision was taken after an approach made by New Zealand Steel in 2013. The Crown now observes that in 1985 the Waitangi Tribunal recommended that the Crown should not assume all of the land in the four blocks is wāhi tapu, while at the same time other parts of the licence area may be in need of protection. Its position now is that it supports mining in accordance with archaeological assessments and the Maioro Kōiwi Protection Plan, on the ground that this arrangement best balances all the competing interests.
Having secured the Crown’s agreement to this course of action, New Zealand Steel applied in May 2014 for leave to withdraw its undertaking and discontinue its long-quiescent proceeding.[6] Its position was that its then current mining plan included the four blocks and would have to be rearranged at considerable expense if mining was not authorised by 1 August 2014.
[6]Leave to discontinue was needed under r 15.20 of the High Court Rules.
Fogarty J granted the application on 4 July 2014.[7] The original proceeding has since been discontinued without opposition, although Ngāti Te Ata’s counterclaim survives, and the Crown has been released, on the ground of redundancy, from its cross-undertaking.
[7]New Zealand Steel Mining Ltd v Butcher [2014] NZHC 1552.
Following delivery of the judgment Ngāti Te Ata brought this appeal. New Zealand Steel was also given to understand that the Crown considered that consent would be required under the Heritage New Zealand Pouhere Taonga Act 2014 before trees could be felled to permit mining. These developments caused New Zealand Steel to change its mining programme in any event. It advised this Court on 7 August 2014 that it would not require access to the four blocks for at least 12 months.
New Zealand Steel has since confirmed in an updating affidavit of a senior executive, Derek Charge, that it will not mine the four blocks, or require the Crown to clear any land within them, before 1 September 2016. Before us, Mr Hodder QC confirmed that it will give two months notice before mining the blocks. The objective is to give Ngāti Te Ata time to take action should New Zealand Steel take steps to mine the blocks. Notice may be given to take effect on 1 September.
Further evidence
Updating evidence from New Zealand Steel was admitted by consent, but the Crown and New Zealand Steel objected to the admission of a late affidavit of Tiana Ritchie which annexed correspondence among counsel. The evidence was controversial and there was no opportunity to respond to it. We decline to admit it.
The issues
Counsel traversed a number of issues in argument. In the balance of this judgment we address them only to the extent necessary. Notably, Mr Ormsby addressed the merits of Ngāti Te Ata’s claim at some length in his written submissions and Mr Cooke QC responded by outlining the nature of the Crown’s defence, but we do not think it necessary or helpful to traverse the arguments. It is not in dispute that Ngāti Te Ata’s case is at least arguable.
Can Ngāti Te Ata rely on the undertaking?
We begin with New Zealand Steel’s submission that Ngāti Te Ata was never a beneficiary of its 1990 undertaking and cannot enforce it now.
Mr Hodder submitted that New Zealand Steel’s undertaking was confined to the only proceeding then on foot, being its judicial review application against the Minister of Energy. It did not contemplate any counterclaim by Ngāti Te Ata, which had been joined but had not at that stage indicated that it would do anything more than seek to be heard. New Zealand Steel contemplated that the undertaking would subsist only until the hearing of its substantive application in April 1991. A narrow approach should be taken to interpreting an undertaking given the serious consequences of breach.[8] Counsel emphasised that Ngāti Te Ata did not, and still does not, seek any injunctive relief against New Zealand Steel. Were it to seek interim relief, it might be required to give an undertaking as to damages. For all these reasons, counsel submitted, the undertaking must be taken to have expired with the discontinuance of New Zealand Steel’s judicial review application.
[8]Zipher Ltd v Markem Systems Ltd [2009] EWCA Civ 44, [2009] FSR 14 at [22] and [36].
Fogarty J did not accept these submissions. He noted that the undertaking had been given in circumstances where New Zealand Steel knew this was a three‑party dispute. The undertaking was given after Ngāti Te Ata had been joined as a respondent and within the period of time for the filing of a defence and counterclaim. None of the content of the Ngāti Te Ata pleadings could have come as a surprise to New Zealand Steel, which must have known that the parties would either negotiate a three-way settlement or appear at a hearing in April in 1991. Thus it would be inconsistent with the context to limit New Zealand Steel’s undertaking to its own application.
We agree with Fogarty J and adopt his reasons. We add that in June 1991 all three parties agreed to the proceeding being adjourned, with the cross-undertakings still in place, pending a three-way settlement. New Zealand Steel having acquiesced in this, it cannot now contend that its undertaking was limited to its own proceeding.
The test for release from an undertaking
It is not in dispute that Fogarty J exercised a discretion when he released New Zealand Steel from its undertaking. Mr Ormsby contended that the Judge misdirected himself in law; he wrongly put weight on the presumptive right of a plaintiff to discontinue its proceeding and required Ngāti Te Ata to establish prejudice from withdrawal rather than requiring New Zealand Steel to show that the undertaking is now unjust.
Fogarty J approached New Zealand Steel’s application by reasoning that an opponent to an application for leave to discontinue and to be relieved from undertakings must establish some prejudice sufficient to justify denying the plaintiff the usual right to decide whether or not to pursue litigation. The circumstances as a whole must make it unjust to continue to enforce the undertaking. The Judge noted that against New Zealand Steel’s imminent entry into one of the four blocks, Ngāti Te Ata’s opposition also functioned as an application for interim relief. Accordingly, the Judge considered whether Ngāti Te Ata’s claim was seriously arguable before going on to examine whether it would be unjust to hold New Zealand Steel to its undertaking.
Mr Ormsby submitted, by reference to Commerce Commission v Air New Zealand Ltd, that to justify release from an undertaking there must be some clear circumstance revealed that makes it unjust to continue to enforce the undertaking.[9] Not every change of circumstance warrants release; the change must be significant and render the continuation of the undertaking unjust.
[9]Commerce Commission v Air New Zealand Ltd HC Auckland CIV-2008-404-8352, 3 November 2011 at [17].
We begin by noting that under r 15.20 of the High Court Rules the plaintiff’s right to discontinue is qualified. It needs leave of the Court where a party to the proceeding has given an undertaking to the Court. That provision anticipates, as one would expect, that the undertaking may have been given in lieu of some interim order. Had an order been made instead, we have no doubt that it would have been expressed “until further order”, meaning that New Zealand Steel could apply if circumstances changed, and any such application would have been dealt with on its merits in the circumstances at the time.
Consistent with that, the authorities show the High Court may revisit an undertaking given in lieu of an interim injunction.[10] This jurisdiction is a necessary incident of the Court’s power to control its own processes. The test is simply whether circumstances have so changed as to afford good grounds for withdrawal.[11] We do not think that Asher J adopted a different test in Commerce Commission v Air New Zealand. He cited the appropriate authorities, and in the passage cited by Mr Ormsby he explained that the applicant must point to some injustice in circumstances where, on the facts, its undertaking had induced a compromise and a material change of position by the opposing party.[12]
[10]Meates v Taylor CA208/89, 30 July 1990 at 16–17; and Adam P Brown Male Fashions Proprietary Ltd v Philip Morris Inc [1981] 148 CLR 170 at 177–178.
[11]Chanel Ltd v FW Woolworth & Co Ltd [1981] 1 WLR 485 (CA) at 492
[12]Commerce Commission v Air New Zealand Ltd, above n 9, at [17].
For these reasons, we are not persuaded that Fogarty J misdirected himself. Further, we agree with the Judge that circumstances had changed sufficiently to justify revisiting the need for the undertaking. New Zealand Steel’s wish to discontinue was sufficient justification for reconsideration. So was the passage of an extraordinary amount of time. Further, the undertaking was no longer part of a reciprocal exchange with the Crown; rather, it had now come to serve as interim relief for Ngāti Te Ata against New Zealand Steel. In such circumstances the Judge was not wrong to consider whether interim relief would be granted were Ngāti Te Ata to apply for it.
Mr Ormsby was in some difficulty when it came to explaining how Ngāti Te Ata may be said to have suffered prejudice through withdrawal of the undertaking. He submitted that Ngāti Te Ata lost the opportunity to settle its Treaty claim before the Crown had a change of heart about mining the wāhi tapu blocks, but that cannot be characterised as prejudice attributable to the undertaking. We observe that Ngāti Te Ata was a necessary party to the 1990 proceeding, rather than a defendant. It was the Crown that had the power to remove the areas from the licence, and it was the Crown and New Zealand Steel that gave cross‑undertakings. Ngāti Te Ata does not seem to have made any kind of commitment or changed its position at the time. And it seems not to have relied on the undertaking throughout the intervening years; indeed, it admits to having lost its institutional memory of the undertaking. Loss of the undertaking may require Ngāti Te Ata to seek interim relief in due course, although for reasons explained below that is far from clear, but we see no injustice in that.
No bona fide need to seek release?
Mr Ormsby argued that there was no credible evidence that New Zealand Steel would need to incur substantial expense if it were unable to mine parts of the wāhi tapu blocks by 1 August 2014. New Zealand Steel’s evidence was that if it could not start mining the four blocks then it would be forced to relocate a conveyor system to the northern part of the licence area, at significant additional cost. Mr Ormsby submitted that this evidence was not credible because within a few months New Zealand Steel had advised it had no plans to mine the blocks until September 2016. This change of position was said to question the credibility of New Zealand Steel’s original claims to urgency.
We make two points about this submission:
(a)On the affidavit evidence it is not self-evidently correct. It is plausible that New Zealand Steel did mean to mine the four blocks in August 2014 but changed its mind for other reasons;
(b)In any event, we need not decide whether the submission is correct. As just explained, we accept that the High Court had sufficient reason, independently of New Zealand Steel’s mining programme, to revisit the undertaking when it did. And we did not understand counsel to disagree that, if Fogarty J directed himself correctly in law, then it cannot be said that he was plainly wrong to exercise his discretion as he did.
As we now go on to explain, New Zealand Steel’s commitment not to mine the four blocks for a period supports rather than detracts from its application for release.
The undertaking is unnecessary
We repeat that we are presently concerned only with the question whether New Zealand Steel should be released from its 1990 undertaking, not with the substantive merits of Ngāti Te Ata’s claim.
As we see it, the decisive consideration is that it is now clear that Ngāti Te Ata does not need the undertaking to protect its interests pending judgment. As explained above, the 2013 proceeding and 1990 counterclaim are to be heard in April 2016. In the meantime, New Zealand Steel has confirmed that it will not mine before 1 September 2016. This differs from the 1990 undertaking only in that it is limited as to time. The limit as to time is reasonable. Should there be some delay in the substantive proceedings, the High Court will have an opportunity to hear an application for interim relief and would decide it with knowledge of the circumstances at that time.
We observe too that it appears that any attempt to mine the four blocks must now confront public and potentially time-consuming processes under the Heritage New Zealand Pouhere Taonga Act, which requires that an authority be obtained from Heritage New Zealand Pouhere Taonga before a suspected archaeological site may be modified.[13] An appeal to the Environment Court lies from such decision.[14] This suggests that the questions whether and how the blocks are mined ultimately will be resolved via court processes or negotiations, and not by unilateral action on New Zealand Steel’s part. We record that New Zealand Steel does not accept that the Heritage New Zealand Pouhere Taonga Act applies to its licence, but the salient point for present purposes is that the Crown does: it has insisted that procedures be put in place to ensure that any sites are identified and it will follow the Act’s processes before it removes trees and vegetation as a precursor to mining.
Decision
[13]Heritage New Zealand Pouhere Taonga Act 2014, ss 44 and 48. It appears that the Crown presumably relied on a general authority under the Historic Places Act 1993.
[14]Section 64. In another context the Environment Court has previously held that the four areas are wāhi tapu: The Chief Executive of the Ministry of Agriculture and Forestry v Waikato Regional Council EC Auckland A133/06, 17 October 2006 at [135].
The appeal is dismissed.
Ngāti Te Ata must pay the first respondent costs as for a standard appeal on a band B basis. (The hearing was not lengthy as it turned out, but it had been set down for two days and the casebook was substantial.) The Crown does not seek costs.
Solicitors:
Wynn Williams, Christchurch for Appellant
Chapman Tripp, Auckland for First and Second Respondents
Crown Law Office, Wellington for Third to Fifth Respondents
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