Ngati Whatua Orakei Trust v Attorney-General
[2017] NZHC 1156
•30 May 2017
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2015-404-2033 [2017] NZHC 1156
BETWEEN NGĀTI WHĀTUA ŌRĀKEI TRUST
Plaintiff
AND
ATTORNEY-GENERAL First Defendant
AND
NGĀTI PAOA IWI TRUST
Second DefendantAND
MARUTŪĀHU ROPU LIMITED Third Defendant
Hearing: On the papers Appearances:
J E Hodder QC, J W J Graham & R M A Jones for Plaintiff
D A Ward for First Defendant
D J Goddard QC & L Theron for Second Defendant
P F Majurey for Third DefendantJudgment:
30 May 2017
JUDGMENT OF PAUL DAVISON J [Re Costs]
This judgment was delivered by me on 30 May 2017 at 2pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Chapman Tripp, Wellington
Crown Law Office, WellingtonMeredith Connell, Auckland
Atkins Holm Majurey, Auckland
NGĀTI WHĀTUA ŌRĀKEI TRUST v ATTORNEY-GENERAL COSTS [2017] NZHC 1156 [30 May 2017]
Introduction
[1] Ngāti Whātua Ōrakei Trust (Ngāti Whātua) applied for judicial review and declaratory relief in relation to three preliminary decisions made by the Minister of Treaty of Waitangi Negotiations regarding land located on the Auckland isthmus and proposed by the Crown to be applied to the settlement of the Treaty of Waitangi claims of the second and third defendants, Ngāti Paoa and Marutūāhu.
[2] On 9 March 2017 I gave judgment granting the defendants’ applications and striking out Ngāti Whātua’s application for judicial review on the basis that the challenged decisions are not justiciable in accordance with the principles of comity.1
The defendants having been successful I considered that they were entitled to costs and directed the parties to file memoranda.
Related proceedings and decisions
[3] Two ancillary matters are relevant to the determination of costs.
[4] First, in 2016, Wylie J, when considering applications for an order to determine two issues as discrete preliminary questions, and for Marutūāhu to be joined as intervener, expressed his preliminary view that costs should be fixed on a
2B basis, and directed the parties to file memoranda as to costs on that application if costs could not be agreed.2 The 2B categorisation was not challenged at that stage.
[5] Second, there is a separate proceeding currently underway between Ngāti Whātua and Ngāti Paoa, in which Ngāti Whātua alleges that Ngāti Paoa breached a settlement agreement by failing to withdraw from the defendants’ strike out application (the Settlement Proceeding). The parties disagree as to the implications of that proceeding on the question of costs in this matter.
Submissions
[6] The defendants have filed a joint memorandum seeking 3B costs. They
1 Ngāti Whātua Ōrakei Trust v Attorney General [2017] NZHC 389.
2 Ngāti Whātua Ōrakei Trust v Attorney General [2016] NZHC 347 at [45].
submit 3B costs are justified because the proceeding raised issues of constitutional principle, including the relationship between the courts, the executive and the legislature, and that it required careful consideration of the case law, Treaty of Waitangi settlement agreements and deeds, and evidence of Crown-Māori negotiation processes.3 The defendants submit that costs should be ordered in Ngāti Paoa’s favour in this proceeding, subject to orders made in the Settlement Proceeding.
[7] Ngāti Whātua submits costs should lie where they fall due to the general importance of the proceedings. It refers to High Court Rule 14.7(3) which provides for reduction or refusal of costs where the proceeding “concerned a matter of public interest, and the party opposing costs acted reasonably in the conduct of the proceeding”. In support of that submission it says the Court and all parties acknowledge the importance of Ngāti Whātua’s case including the novel questions raised – including those that would have been raised if the matter had reached the substantive stage. In support of this submission Ngāti Whātua refers to some preliminary comments made by Wylie J about the importance, novel nature and
public interest of the proceedings.4
[8] Ngāti Whātua also raises two matters in response to the defendants’ joint memorandum. First, it says 3B costs are not available for this proceeding. Justice Wylie had categorised it as a 2B matter and, pursuant to r 14.3, that categorisation applies to all subsequent determinations of costs, unless there are special reasons to the contrary. Ngāti Whātua cites the rationale for not changing the categorisation part way through a proceeding, being that a costs categorisation is likely to have
influenced the parties’ conduct in the proceeding.5 Second, Ngāti Whātua submits
that some of the defendants’ claimed time allocations are excessive having regard to the overlapping issues raised by them, the coordinated approach they took in relation to the presentation of their submissions at the hearing, and the limited extent of
discovery in this case.
3 At [3].
4 Ngāti Whātua Ōrakei Trust v Attorney General [2016] NZHC 347 at [30] and [34].
5 Houghton v Saunders [2013] NZHC 3452.
[9] Finally, Ngāti Whātua submits Ngāti Paoa’s costs should be stayed until
conclusion and determination of the Settlement Proceeding.
Applicable legal principles
[10] Costs are at the discretion of the Court (r 14.1). However, rr 14.2 to 14.10 provide guidance as to the exercise of that discretion.
[11] Rule 14.3 provides three categories:
Category 1 proceedings Proceedings of a straightforward nature able to
be conducted by counsel considered junior in the High Court
Category 2 proceedings
Proceedings of average complexity requiring counsel of skill and experience considered average in the High Court Category 3 proceedings
Proceedings that because of their complexity or significance require counsel to have special skill and experience in the High Court
(Emphasis added)
[12] Where the court determines a proceeding’s category in advance of a proceeding (as Wylie J did here, by placing it in category 2B), r 14.3(2) provides that such categorisation applies to all subsequent determinations of costs in the proceeding unless there are special reasons to the contrary, for the policy reasons noted by the plaintiff in its submissions.
[13] While the rules are designed to create a framework for the determination of costs that is both “predictable and expeditious” (r 14.2(g)), they also identify a number of circumstances where it may be appropriate for the Court to reduce or even refuse to make an order for costs that would otherwise be payable by application of the rules.6 One such situation is where the proceeding “concerned a matter of public interest, and the party opposing costs acted reasonably in the conduct of the proceeding” (r 14.7(e)). Where that is the case, the Court may either refuse or reduce
the costs otherwise payable under the rules.
6 High Court Rules 2016, r 14.7.
[14] The plaintiff relies on the following statement of Lord Woolf in the Privy
Council case of New Zealand Maori Council v Attorney-General :7
There remains the question of costs. Although the appeal is to be dismissed, the appellants were not bringing the proceedings out of any motive of personal gain. They were pursuing the proceedings in the interest of taonga which is an important part of the heritage of New Zealand. Because of the different views expressed by the members of the Court of Appeal on the issues raised on this appeal, an undesirable lack of clarity inevitably existed in an important area of the law which it was important that their Lordships examine and in the circumstances their Lordships regard it as just that there should be no order as to the costs on this appeal.
[15] That case arose from the concerns of the New Zealand Māori Council regarding a restructuring of broadcasting and possible effects of the planned restructuring on the survival of te reo Māori. The Council sought a declaration that the proposed transfer of assets of the former Broadcasting Corporation of New Zealand to a new state owned enterprise pursuant to the restructuring was unlawful and inconsistent with the principles of the Treaty of Waitangi. The steps taken by the Council were motivated by an obvious and broad public interest in the protection of te reo Māori as taonga and an important part of Māori and New Zealand culture.
[16] In Prebble v Awatere Huata, when referring to the Privy Council decision declining to award costs to the successful respondent in New Zealand Maori Council v Attorney-General, the Supreme Court said:8
[17] The Judicial Committee considered that the appellants in that case were acting to protect “part of the heritage of New Zealand” without any motive of personal gain. In addition, the different views expressed in the Court of Appeal meant that “an undesirable lack of clarity inevitably existed in an important area of the law which it was important that Their Lordships examine”.
[18] In Wong v Registrar of the Auckland High Court Duffy J observed that the exception should only apply to something that is “truly in the public interest and not
7 New Zealand Maori Council v Attorney–General [1994] 1 NZLR 513 at 525.
8 Prebble v Awatere Huata [2005] NZSC 18, [2005] 2 NZLR 467 at [2].
merely to the public’s benefit, such as the correct interpretation of a piece of legislation. It should also not arise out of a private interest.”9
[19] I note that while a proceeding must have both merit and involve a matter of genuine public interest to engage this exception,10 a party bringing litigation is not required to act out of “pure altruism”. It will be enough if the subject matter of the litigation impacts on significant public interests and transcends the interests of the parties.11
[20] In public law cases as well as in other civil litigation, the rule that costs follow the event will generally be just as between the parties.12 In the end, the question is whether r 14.7(e) applies in the particular circumstances of the case.13
Discussion as to refusal or reduction of costs on public interest grounds
[21] Here the plaintiff correctly notes that the Court has characterised the proceeding as involving novel issues relating to the conduct of the Crown in respect of a settled iwi in relation to an unsettled iwi, and whether the Crown must conduct itself in accordance with tikanga Māori in negotiating Treaty of Waitangi settlements, as well as other issues. The plaintiff also refers to the observations of Wylie J when dealing with Ngāti Paoa’s application for the trial to be split and for preliminary questions to be determined relating to the Crown’s power to alienate land on the Auckland isthmus for the purpose of Treaty settlements, and whether the Crown’s decision to transfer land to Ngāti Paoa for the purpose of a Treaty settlement is amenable to judicial review. However, the passage of Wylie J’s judgment cited by the plaintiff omits the Judge’s preceding comments in which he drew a distinction between a determination of the narrow issues posed by the preliminary questions that Ngāti Paoa sought to have determined as preliminary
issues, and the wider issues arising from Ngāti Whātua’s statement of claim. He said:
9 Wong v Registrar of the Auckland High Court (2008) 19 PRNZ 32 at [18].
10 New Health New Zealand Inc v South Taranaki District Council [2014] NZHC 993, (2014) 21
PRNZ 766 at [8]-[10].
11At [8]-[10]. See also, more recently, New Zealand Airline Pilots Association Industrial Union of Workers Inc v Director of Civil Aviation [2016] NZHC 2409, (2016) 23 PRNZ 276.
12 Prebble v Awatere Huata (2005) 17 PRNZ 581 at [5].
13 New Health New Zealand, above n 11.
[33] There is of course an advantage to the Attorney-General, Ngāti Pāoa and Marutūāhu if the trial is split. They will not be put to the time and expense of preparing for the substantive hearing – at least not initially. If the preliminary questions are resolved in favour of Ngāti Pāoa, it will be able to complete its Treaty settlement with the Crown. The iwi/hapū who are members of Marutūāhu will be able to advance their claims. So will other iwi/hapū yet to be served. The public interest would also be served if the litigation can be shortened by determining the preliminary questions, given the pressures on Court time.
[34] As against this, it would be disadvantageous to Ngāti Whātua Ōrākei if the issues raised by this litigation are not fully ventilated and resolved. If the proposed preliminary questions are answered in Ngāti Pāoa’s favour, the proceeding would be disposed of essentially on a legalistic basis, without exploring the base concerns raised by Ngāti Whātua. I suspect that those base concerns would remain a cause for dissatisfaction, simmering in the background, and that sooner or later, they would come before the Courts again, albeit in a different context. The public interest will also be served if the matters raised by the substantive proceedings are fully ventilated. Ngāti Pāoa and other iwi and hapū claim interests in land in the central Auckland region. A definitive determination on the Crown’s post settlement obligations to Ngāti Whātua Ōrākei is likely to be of significant value not only to others claiming an interest in land in the central Auckland region, but also to the wider public.
[22] When considering the question of costs, it is appropriate to do so not by reference to the entire scope of the proceeding as appears from the plaintiff’s statement of claim, but rather by reference to the issues and scope of that part of the proceeding to which the issue of costs relates. Here the question of whether the Court should award, reduce or reject costs is appropriately determined by reference to the issues that arose in connection with the defendants’ applications to strike out the plaintiff’s claim. It is those applications which were successful and in respect of which an order for costs is sought. In order to address and determine those applications, beyond recognising that the claim raised novel issues of potentially broad application and public interest as being a factor relevant to a strike-out determination, it was not necessary for the Court to consider those broader issues that were raised by the plaintiff in its statement of claim. The Court determined the defendants’ applications by reference to and application of the principle of comity and thereby deciding that the challenged decisions were not reviewable.
[23] When so analysed it is clear that although broader issues of public importance would arise in the context of a trial at which the plaintiff’s allegations and contentions as set out in its statement of claim would be ventilated, those
broader issues were not in fact addressed or engaged by the Court’s consideration and determination of the defendants’ application to strike out the plaintiff’s claim. The scope of the issues that arose in relation to the strike-out applications were comparably narrow. They related to the application of the principle of comity to the circumstances of the case, and particularly to the situation whereby decisions and actions of the Minister of Treaty of Waitangi Negotiations in connection with proposed Treaty settlements, that were expressly and entirely conditional on the passage of Parliamentary legislation, are amenable to judicial review.
[24] Accordingly, while the plaintiff’s claim as set out in its statement of claim would give rise to issues of wide public importance in relation to the Crown and Treaty settlements generally, the nature and scope of those issues does not mean that the strike out applications and their disposition by my judgment of 9 March 2016 should be characterised as involving issues of public interest such as would warrant that process and determination being treated as an exception to the general rule that costs should follow the event.
Should I make an adjustment to account for the co-ordinated and overlapping approach taken by the defendants?
[25] Counsel for the plaintiff submits that the defendants’ costs should be reduced as the time claimed for several of the attendances detailed in the schedules attached to their joint memorandum are excessive in some respects. The plaintiff says that the first defendant has taken the central role in responding to and defending the plaintiff’s claim, and that the second and third defendants have largely followed and to a significant extent their pleadings and submissions have overlapped with those of the first defendant. The plaintiff supports this proposition by submitting that the statements of defence filed by the second and third defendants are expressed in substantially similar terms. In relation to discovery, the plaintiff submits that the first defendant has claimed 2.5 days with respect to the discovery of 214 documents, which it says is clearly excessive.
[26] While the second and third defendants’ defence of the plaintiff’s claim have to a degree followed the central role of the first defendant in defending the claim, the second and third defendant each played a significant part at the hearing by making
full written submissions. Further, Mr Goddard QC for the second defendant presented the substantial oral argument for the defendants which covered what was common ground and which was adopted by counsel for the other defendants, as well as making their own submissions. The time claimed by the first defendant to attend to discovery is not in my view “clearly excessive” having regard to the number of documents and the importance of the issues. I am not persuaded that any of the matters raised by the plaintiff regarding reduction of the defendants’ costs on these grounds, warrant a reduction.
The appropriate costs scale
[27] As I have noted, the defendants are seeking an order for costs made on a scale 3B basis. Counsel for the plaintiff submits that, since Wylie J categorised the proceeding as 2B in his judgment of 4 March 2016, nothing has occurred or has been identified that would amount to special reasons to alter the earlier assessment. The plaintiff further submits that the strike out applications involved a relatively orthodox interlocutory hearing in terms of complexity. I agree. While the defendants are correct that the proceedings raised issues of constitutional principle, the relationship between the courts, executive and the legislature, and relevant case law, I do not consider that the applications to strike out the proceeding can be said to have involved that level of complexity or significance that required counsel to have special skill and experience. Although counsel for all the parties are skilled and very experienced practitioners, particularly in this area, it is not their level of skill and experience that determines this question, but rather an objective assessment of the nature and complexity of the matter. Here the wider issues and complexities that would arise in the course of a substantive trial of the plaintiff ’s claim were not a significant feature of the interlocutory hearing that occurred.
[28] For these reasons I find that the defendants’ costs are to be calculated on the scale 2B basis. I approve the attendances as set out for the first, second, and third defendant in their joint memorandum, but quantified in accordance with the 2B scale rather than the 3B scale employed in the joint memorandum. Amended schedules calculated in accordance with 2B are attached. The disbursements claimed are approved.
Order for stay of Ngāti Paoa assets
[29] As I have noted above, Ngāti Whātua have commenced a separate proceeding against Ngāti Paoa in which they claim that a settlement was agreed between them, the terms of which required Ngāti Paoa to withdraw their application to strike out Ngāti Whatua’s claim. As that proceeding is yet to be determined, and as the outcome is potentially relevant to the question of whether Ngāti Paoa should recover costs on this matter, I consider it appropriate to fix Ngāti Paoa’s costs but stay the order until the conclusion and determination of those other proceedings, at which time the issue of the costs in this proceeding can be addressed in light of the outcome of those proceedings and particularly if the alleged terms of settlement included disposition and agreement as to legal costs and disbursements.
Conclusion
[30] Accordingly, I make the following orders:
(a) An order that the plaintiff pay costs and disbursements to the first defendant in the sum of $32,517.95.
(b)An order that the plaintiff pay costs and disbursements to the second defendant in the sum of $18,715.26, such order and enforcement thereof to be stayed pending further order of this Court.
(c) An order that the plaintiff pay costs and disbursements to the third defendant in the sum of $15,036.65.
Paul Davison J
FIRST DEFENDANT
Item Step in proceeding Allocation Amount ($)
2 Commencement of defence by defendant 2 4460
9 Pleading in response to amended pleading 0.6 1338
Pleading in response to second amended
9 pleading 0.6 1338
20 List of documents on discovery 2.5 5575
22 Filing interlocutory application 0.6 1338
24 Preparation of written submissions 1.5 3345
Preparation by applicant of bundle for
25 hearing 0.6 1338
Appearance at hearing of defended
26 application for principal counsel 2 4460
27 Second and subsequent counsel 2 4460
Total scale costs 12.4 27652
Total disbursements 4865.95
TOTAL COSTS AND DISBURSEMENTS 32517.95
SECOND DEFENDANT
Item Step in proceeding Allocation Amount ($)
2 Commencement of defence by defendant 2 4460
9 Pleading in response to amended pleading 0.6 1338
Pleading in response to second amended
9 pleading 0.6 1338
24 Preparation of written submissions 1.5 3345
Appearance at hearing of defended
26 application of principal counsel 2 4460
27 Appearance at hearing of second counsel 1 2230
Total scale costs 7.7 17171
Total disbursements 1544.26
TOTAL COSTS AND DISBURSEMENTS 18715.26
THIRD DEFENDANT
Item Step in proceeding Allocation Amount ($)
Commencement of defence by defendant to
2 claim 2 4460
9 Pleading in response to amended pleading 0.6 1338
Pleading in response to second amended
9 pleading 0.6 1338
24 Preparation of written submissions 1.5 3345
Appearance at hearing of defended
26 application of principal counsel 2 4460
Total scale costs 6.7 14941
Total disbursements 95.65
TOTAL COSTS AND DISBURSEMENTS 15036.65
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