Paul v Durie
[2017] NZHC 713
•12 April 2017
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2016-485-744 [2017] NZHC 713
BETWEEN CLETUS MAANU PAUL
Plaintiff
AND
SIR EDWARD TAIHAKUREI DURIE First Defendant
AND
THE NEW ZEALAND MĀORI COUNCIL
Second Defendant
Hearing: 10 April 2017 Counsel:
A N Isac for Plaintiff
F E Geiringer for First Defendant
G Davidson for Second DefendantJudgment:
12 April 2017
JUDGMENT OF SIMON FRANCE J
[1] The first defendant, Sir Edward Durie, applies to strike out judicial review proceedings filed by the plaintiff, Mr Paul. The second defendant has not similarly applied, but if the first defendant succeeds that would be an inevitable consequence.
Judicial review proceedings
[2] Mr Paul and Sir Edward were (or are) co-chairs of the New Zealand Māori Council (the Council). The relationship between them broke down, and there have been disputes since. On 16 April 2016 Sir Edward was elected sole chair at what purported to be a meeting of the Council. Mr Paul says the meeting was improperly convened (because he as co-chair did not agree to it). Consequently the vote at that
meeting is invalid. That is the first ground of review.
PAUL v DURIE [2017] NZHC 713 [12 April 2017]
[3] A second issue is raised in the proceedings. It concerns who acts for the Council as its legal representatives. Presently it is the firm of Woodward Law Offices. The principal of the firm, Ms Donna Hall, is married to Sir Edward. Mr Paul claims this creates an unmanageable conflict.
[4] There are three challenged decisions in relation to this issue. At the meeting of 15 April 2016, a “litigation services committee” was appointed. Its role is to make litigation decisions on behalf of the Council. Mr Paul alleges the three appointees had connections to Woodward Law Offices that needed to be disclosed and were not. This is claimed to invalidate the committee’s appointment.
[5] At that meeting, there was also a resolution passed confirming Woodward Law Offices as the Council’s legal representatives. That decision is challenged on the basis that:
(a) Sir Edward and Ms Hall (who is also a member of the Council) both participated in the discussions; and
(b) their conflicts of interests were not disclosed.
[6] Further, a declaration is sought that Sir Edward and Ms Hall cannot hold the roles of co-chair, Council members and solicitor simultaneously.
[7] Finally, if these challenges succeed, a similar decision made at the preceding meeting (6 September 2015) is challenged. It is again alleged Ms Hall and Sir Edward participated and voted on the motion.
Preliminary observation
[8] The defence of the Council’s decisions, and indeed the legitimacy of the Council’s meetings, are being carried by the first defendant. The Council is taking no active role. That is in my view both unusual and unfortunate. It is after all the Council’s processes under challenge. It is a statutory body and the Court would be assisted by proper representation in the matter. I invite the Council to reconsider its position.
Applicant’s submissions
[9] The first defendant’s strike out application has three aspects:
(a) it is submitted the whole proceeding should be struck out as serving no useful purpose;
(b)alternatively, it is submitted the decisions concerning the litigation committee and legal representation are not reviewable since they are internal management decisions, and do not directly affect Mr Paul; and
(c) alternatively, if unsuccessful on these, that part of the proceeding should be struck out as irrelevant and carrying the risk of unnecessarily delaying the proceedings (because the underlying facts are in dispute).
[10] Concerning the first submission, of no useful purpose, the first defendant draws together a submission that Mr Paul’s application is an abuse of process with the related proposition that everything Mr Paul seeks to achieve has always been able to be done, and still can, by convincing a majority of the Council to support its position.
[11] The abuse argument itself has three strands. It is first said that Mr Paul seeks to challenge the ability of Sir Edward unilaterally to call the meeting of
16 April 2016 while himself having done the same thing. This is a reference to a competing meeting held in February 2016 at Mr Paul’s instigation at which Mr Paul was elected sole chair. Mr Paul has subsequently agreed the outcome of that meeting is invalid, although that concession is apparently sourced only in an acceptance that the meeting lacked the necessary numbers.1 It is submitted Mr Paul does not accept he could not call the meeting. That being so, it is contended that the present
proceeding which argues for a contrary position is an abuse.
1 Durie v Paul HC Wellington CIV-2016-485-000217, 13 June 2016.
[12] The second thread of the abuse claim is the proposition that not only did Mr Paul delay filing the proceeding for five months, but during that time he continued to hold himself out as co-chair thereby taking advantage of the delay. Finally, it is said that in addition to not seeking resolution at a meeting of the Council, Mr Paul has rejected reasonable offers of resolving the impasse. The first defendant claims that a majority of members had agreed to have a postal ballot on the chair issue, but Mr Paul unreasonably declined to agree to that.
[13] The second tier application, if unsuccessful in the primary argument, is an application to strike out the challenges to the decisions involving legal representation and the establishment of a legal oversight committee. It is submitted, relying on Barrett v Te Runanga O Ngati Pu Inc, that the Court will not review an internal decision of a body such as the Council where that decision reflects the majority wishes of the organisation and can be revisited by a majority vote.2 It is here noted that if the decision had to be taken again, it would happen at a meeting of the Council at which all members are entitled to attend and vote. Such a meeting is what
is already scheduled for the end of this month, and Mr Paul could put the motions then.
[14] The third alternative submission concerns certain aspects of the statement of claim. I will consider that at the conclusion of the judgment.
Decision
[15] Mr Geiringer accepted his was a difficult task. He relies on Te Whakakitenga o Waikato Inc v Martin where a plaintiff sought to review her removal as chair of an iwi organisation.3 The Court of Appeal observed:
A court may strike out a claim if it discloses no reasonably arguable cause of action. It is inappropriate to strike out a claim unless “the court can be certain that it cannot succeed”. The jurisdiction should be exercised sparingly. However, as this Court said in Attorney-General v McVeagh:
2 Barrett v Te Runanga O Ngati Pu Inc [2002] NZAR 296 (HC).
3 Te Whakakitenga o Waikato Inc v Martin [2016] NZCA 548, [2017] NZAR 173 at [15]–[16], footnotes omitted.
… if the claim is doomed to failure, there can be no jurisdiction for allowing it to continue. The striking-out jurisdiction is founded on the realisation that resources are finite and are not to be wasted.
The same principles apply to striking out an application for judicial review.
[16] The passage assists both parties by emphasising the high threshold before a strike out will be ordered, but recognising that hopeless cases will be dismissed at a preliminary stage.
[17] In Martin itself, the Court declined to strike the proceeding out on grounds of non-justiciability. It was accepted that a majority vote at a properly constituted meeting in relation to the tenure of an officer would not lightly be thwarted, but serious procedural unfairness would still be amenable to review. Mr Isac submits that is what is alleged here.
[18] In Martin the proceedings were in fact struck out, but that was because they could no longer be of practical effect. Ms Martin did not seek reinstatement as chair. The other issue was her membership of the body and that was no longer at risk.
[19] The case does not assist the applicant. There remains utility in continuing the proceeding here as it would settle who is the chair of the Council. There may also be consequential effects on decisions taken at the relevant meetings if Mr Paul is found to be correct.
[20] The other considerations relied on by the first defendant go to relief. I do not accept that it can be said relief will certainly be declined if the plaintiff succeeds in his claims. Mr Isac submits, and I accept, that there are factual disputes in relation to some of the matters relied on by the first defendant. An example of this is whether there was in fact a majority of members in favour of holding a postal ballot. It is also the case that the plaintiff will point to conduct on the part of Sir Edward which is submitted to be equally relevant to the discretion to grant relief.
[21] I am satisfied that the issue of whether relief should be ordered is best decided after a court has received evidence and made determinations as to what occurred. I do not consider the delay in filing to be in that category where relief
would necessarily be declined, and I am not satisfied at the interlocutory stage that the first defendant has pointed to prejudice caused by the delay.4 I see nothing in the allegation that the proceeding should be struck out because Mr Paul has acted inconsistently with his claim. No-one in fact contends a co-chair can act unilaterally.
[22] I turn next to the subsidiary challenges to the decisions of the Council appointing legal counsel, and selecting a legal services oversight committee. I have not been persuaded at this interlocutory stage that the plaintiff’s claim is untenable. The pleadings are pitched at a high level that ultimately may not be sustainable. In this I refer to the declaration that a fully informed Council cannot, because of the impossibility of managing conflicts, use Woodward Law offices. But the Council is a statutory body and I considered the plaintiff should be able fully to develop its argument that the rules of conflict of interest, and bias, apply to this relatively low level decision. However, as observed at the hearing, the nature of the conflicts being alleged needs much clearer articulation.
[23] I accept that in Barrett v Te Runanga O Ngati Pu Inc, Chambers J applied the internal management rule to the actions of the defendant body which was an incorporated society.5 Whether, however, the same approach applies in the same way to a statutory body such as the Council with its broad public functions is a matter that can be addressed at trial.
[24] It is relevant at the strike out stage to note that the Council has now adopted a Policies and Procedures Manual that contains a section on conflicts. The contents seem orthodox and there is a reference to the Controller and Auditor-General’s guidelines on managing conflicts. The point that Mr Isac makes is that the Council appears to itself accept that there is an obligation to manage conflicts. That tells
against the proposition that the plaintiff’s claim is non-justicable.
4 To emphasise the point made under my preliminary observations earlier, it is of course the
Council as second defendant that should be asserting prejudice.
5 Barrett, above n 2, at [27].
[25] The applications to strike out the entire proceeding, or alternatively the challenges to the Council’s decisions concerning legal representation are dismissed. I am not satisfied the claims are hopeless or unfeasable, nor that relief will inevitably be declined.
Application to strike out aspects of the statement of claim
[26] The first defendant is on stronger ground here. As a preliminary point I note there is now a considerable history of conflict between the plaintiff and the first defendant. Each seems to have support amongst Council members. But this is not a general inquiry into the functioning of the Council. It is a judicial review challenge of certain impeached decisions, and the pleadings must be tight and focused so the Court is not unnecessarily burdened with festering, but irrelevant aspects to these proceedings. That means, for example, any contentious facts included for “information” or “by way of background” must be deleted. If authority be needed, I rely on r 15.1(1)(b) of the High Court Rules 2016 – where part of a pleading can be struck out if it is likely to cause delay.
[27] I discussed the pleadings with counsel at the hearing but for the record summarise the matters:
(a) paragraphs [16] to [21] should be deleted or summarised in a simple proposition;
(b)paragraphs [22] to [24] are struck out. The underlying proposition can be stated. No quantum should be given unless relevant to the pleading, and verified;
(c) in relation to alleged conflicts of interest, if any other than the financial benefit issue are alleged, these should be identified;
(d)in paragraph [35] the essential proposition is that the meeting was terminated by Mr Paul as chair. Counsel needs to consider carefully what else is needed;
(e) paragraphs [45] to [49] should be reviewed for relevance;
(f) paragraphs [59.1] and [59.2] are irrelevant, as are paragraphs [65] to
[67]. All are to be removed; and
(g) there is repetition of the facts pleaded to support bias.
Directions
[28] The defendant is to file an amended statement of claim by 5 pm,
26 April 2017.
[29] The defendant is to file any further evidence by 5 pm, 11 May 2017. [30] The plaintiff has five working days for any reply evidence.
Costs
[31] Each party has had success and the outcome will clarify the scope of the scheduled hearing. Costs to lie where they fall.
Simon France J
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