Proprietors of Wakatū v Attorney-General
[2014] NZHC 1785
•30 July 2014
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2014-442-47 [2014] NZHC 1785
UNDER the Land Transfer Act 1952 IN THE MATTER OF
an application under s 145A of the Land
Transfer Act 1952 for an order that caveats
9426219.2, 9207310.1, 9426219.1 and
9215495.1 (all identified by LINZ dealing
ID 9769628) against dealings not lapseBETWEEN
PROPRIETORS OF WAKATŪ
ApplicantAND
THE ATTORNEY-GENERAL Respondent
CIV-2014-442-49
UNDER the Land Transfer Act 1952
IN THE MATTER OF an application under s 143 of the Land
Transfer Act 1952 for an order that caveats
9426219.2, 9207310.1 and 9426219.1 (all identified by LINZ dealing ID 9769628) be removed
BETWEEN THE ATTORNEY-GENERAL Applicant
AND PROPRIETORS OF WAKATŪ
Respondent
Hearing: 25 July 2014 Appearances:
K Feint and M S Smith for applicant
R Hogg and D Soper for respondentJudgment:
30 July 2014
JUDGMENT OF CLIFFORD J
PROPRIETORS OF WAKATŪ v ATTORNEY-GENERAL [2014] NZHC 1785 [30 July 2014]
Introduction
[1] This is an application by the Proprietors of Wakatū Inc (Wakatū)1 under s 145A(1) of the Land Transfer Act 1952 that caveats lodged against land in Nelson not lapse. Wakatū’s application to this Court is in response to applications for lapse made by the Crown to the Registrar-General of Land to enable those properties to be transferred to local iwi pursuant to Treaty of Waitangi settlement agreements between the Crown and Tainui-Taranaki and Kurahaupo iwi of Te Tau Ihu o Te Waka-a-Māui. Those agreements, as given effect by the relevant Treaty settlement legislation, require those transfers to take place on or after 1 August 2014.
[2] To the extent that this Court does not uphold Wakatū’s application, the Crown has applied for orders under s 143 of the Land Transfer Act that those caveats lapse on 1 August 2014, ahead of what would otherwise be the somewhat later statutory lapse date for those caveats.
Factual background
[3] Wakatū, Rore Pat Stafford, and Rore Pat Stafford, Paul Te Poa Karoro Morgan, Waari Ward-Holmes and James Dargaville Wheeler in their capacities as trustees of the Te Kāhui Ngahuru Trust, brought proceedings in the High Court in Wellington in 2010 (the Wakatū proceedings).2
[4] The plaintiffs’ claims arose out of events in the 1840s, the arrival of European settlers at Nelson and the settlement and subdivision of Nelson City and its surrounding districts. The claims related to land in Nelson subject to that part of the New Zealand Company’s colonising scheme that provided for one tenth of the land
sold to settlers under the Company’s prospectuses, then subsequently surveyed and
1 Wakatū was originally established pursuant to s 15A of the Māori Reserved Land Act 1955 by the Wakatū Incorporation Order 1977, and is now constituted under Part 13 of the Te Ture Whenua Māori Act 1993. Wakatū is an incorporation of the persons who are the beneficial owners of the land the legal title of which is vested in Wakatū.
2 HC Wellington CIV-2010-442-181.
Proprietors of Wakatū Inc, Plaintiff; Rore Pat Stafford, Second Plaintiff; and Rore Pat Stafford, Paul Te Poa Karoro Morgan, Waari Ward-Holmes and James Dargaville Wheeler, Third Plaintiffs.
The Attorney-General, Defendant.
Ngāti Rārua Iwi Trust, Ngāti Koata Trust, Ngāti Tama Manawhenua Ki Te Tau Ihu Trust, Te
Runanga O Ngāti Kuia Trust And Ngāti Apa Ki Te Rā To Trust, Interveners.
allocated by ballot in New Zealand to those settlers, to be reserved for the benefit of
local Māori from whom the land had been obtained (the Nelson Tenths).
[5] In very broad terms, the plaintiffs in the Wakatū proceedings claim that express and/or institutional constructive trusts of the land which was, or ought to have been, reserved as the Nelson Tenths had been breached by the Crown. Moreover, the Crown had breached fiduciary and other similar obligations. By way of remedy, the plaintiffs sought declarations: (i) confirming the nature and breach of the trusts and other obligations; (ii) confirming that land still held by the Crown in breach of those trusts was held on constructive trust for the customary owners; and (iii) obliging the Crown to substitute land, provide compensation and account for profits.
[6] In my 26 June 2012 judgment in the Wakatū proceedings I found against Wakatū.3 I also held that Wakatū, and Te Kāhui Ngahuru Trust, did not have standing to bring those claims. I held, in effect, that it was customary groups who had standing to bring those claims. I recognised Mr Stafford’s standing in his individual capacity, but not in a representative capacity. I note that, in argument of these applications before me, it was submitted that that decision may have overlooked Mr Stafford’s customary authority, as a kaumātua of Ngāti Rārua and Ngāti Tama, to bring claims on behalf of the members of those customary groups the
protection of whose interests is entrusted to him.
[7] The plaintiffs have appealed my judgment (CA436/2012). That appeal has been heard, and the judgment of the Court of Appeal is pending.
The caveats
[8] On 13 November and 13 December 2012 Wakatū lodged caveats (the Caveats) against various titles comprising part of the land (the Caveated Land) occupied by three Nelson primary schools:
(a) Auckland Point (13 November 2012);
3 Proprietors of Wakatu Inc v Attorney-General, [2012] NZHC 1461.
(b) Victory (13 December 2012); and
(c) Maitai (13 December 2012).
[9] In each case Caveated Land is said by Wakatū to comprise land that:
(a) was selected in 1842 as part of the original Nelson Tenths; or
(b) was not so selected but, being land occupied as a pā, should have
separately been reserved for ongoing use as such by iwi; and
(c) is still owned by the Crown today.
[10] As such, the Caveated Land is identified by Wakatū as land:
(a) in respect of which the Crown has breached obligations owed to iwi,
hapu and whānau of Te Tau Ihu o Te Waka-a-Māui; and
(b) which is still available to be restored to those iwi, hapū and whānau
by way of remedy for those breaches.
[11] Wakatū lodged caveats against some nine titles in all, seven at Auckland Point and one at each of Victory and Maitai Primary Schools.4 The table below lists the number and date of the instrument which created the caveat, the primary school in question, the current title reference and the number of the underlying original section or sections in the New Zealand Company’s 1842 plan of Nelson on the basis of which the original Nelson Tenths sections were chosen. In the final column each
caveat is given a number (1 – 9), which numbers are used for convenience in the
balance of this judgment:
Instrument School Current title reference Original section no. Caveat No. 9207310.1 Auckland Point NL 51/18 62 – 65 1 “ “ NL 51/221 (old road) 2
4 In a second instrument lodged on 13 November 2012, 9215495.1, Wakatū separately caveated the Auckland Point titles NL 51/18 and NL 51/221. As best as I understand it, the reason for that separate caveat related to Public Works Act acquisitions in 1924 by reference to which Wakatū claims a separate interest in that land. Those caveats are not at issue in these applications.
“ “ NL 54/62 61 3 “ “ NL 46/211 61 4 “ “ NL 8A/11 60 5 “ “ NL 8B/992 60 6 “ “ NL 8B/993 60 7 9426219.1 Maitai CIR 80431 205 8 9426219.2 Victory NL 100/130 625 and 626 9
[12] Instrument 9207310.1 particularised the estate and interest claimed in the
Auckland Point titles in the following way:
Estate or interest claimed from the registered proprietor
A beneficial interest on the basis of an express or implied trust
The caveator (the beneficiaries) claims a beneficial interest in the land on the basis of an express, constructive or resulting trust over the land held by the registered proprietor.
Alternatively, the caveator (the beneficiaries) claim a beneficial interest in the land on the basis that the registered proprietor (who holds the land on behalf of the Crown) holds the land in breach of the Crown’s fiduciary duty to the caveator.
Particulars:
1.1A key element of the NZ Company’s scheme for the settlement of Nelson was its intention to hold reserves equating to one-tenth of the land acquired on trust for the benefit of the chiefs, their families, tribes and successors in perpetuity (the “Tenths Owners”). The caveator is a successor to the Tenths Owners.
1.2In 1840, the NZ Company and the Crown agreed that the Crown would assume the obligation to create the trust in fulfilment of and according to the tenor of, the terms that the NZ Company had agreed with the Tenths Owners.
1.3The Crown was in a fiduciary relationship with the Tenths Owners in acting in their interests to create the Tenths Reserves.
1.4The legal entitlement to the Tenths Reserves and occupation land which includes the land subject to the caveat was crystallised by Commissioner Spain’s 1845 decision and the 1845 Crown Grant.
1.5The entitlement to the Tenths Reserves was additional to the requirement to exclude pā, cultivations and burial grounds (that is, the land the Tenths Owners had not agreed to sell) and on this basis, the caveator argues that land at Matangi Awhio/Auckland Point subject to this caveat should either have not been brought within the Tenths Reserves or should have been excluded from settlement on the basis that it was an established pā and customary trading site and as such should have been reserved as an occupation site.
1.6The Crown failed in its duty to reserve a full one-tenth of land and to protect that land that was reserved as Tenths (which includes land
subject to this caveat at Auckland Point) on trust. The Crown also failed in its duty to exclude pā, cultivations and burial grounds (including land at Auckland Point subject to this caveat).
1.7The Crown’s breach was aggravated by its decision to compulsorily acquire land at Auckland Point for the purposes of a school under the Public Works Act 1908 and vest that land in the Education Board of the District of Nelson.
1.8If the technical requirements required for an express trust (certainty of intention; certainty of subject matter and certainty of objects) are not satisfied, then the caveator claims an interest as beneficiary of a constructive trust or a resulting trust which came into being whereby the settler (the Tenths Owners) had expressed no intention to dispose of its beneficial interest, which it retains on the basis it has not been effectively alienated.
The land is currently subject to breach of trust/breach of fiduciary proceedings brought by the caveator against the Crown seeking an order that the land be returned to the caveator.
[13] Instruments 9426219.1 and 2 were in broadly identical terms, save that:
(a) clauses 1.5 and 1.6 for Auckland Point were omitted – their purpose being to found the claimed interest in land originally comprising sections 60 and 61, which were not selected as Nelson Tenths; and
(b)clause 1.7 for Auckland Point was also omitted, as no equivalent Public Works Act 1981 considerations arise as regards Victory and Maitai Primary Schools.
The caveated land and the treaty settlements
[14] The Crown has entered into separate Deeds of Settlement with the members of two groupings of iwi of Te Tau Ihu o Te Waka-a-Māui:
(a) Tainui-Taranaki: Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki Te Tau
Ihu and Te Ātiawa o Te Waka-a-Māui.
(b)
Kurahaupo:
Ngāti Apa ki te Rā Tō, Ngāti Kuia and Rangitāne o
Wairau.
[15] Two separate settlement acts assented to on 22 April 2014 (the Settlement Acts) authorise and, to a certain extent, effect the settlements recorded in those various deeds on and from 1 August 2014.5
[16] Auckland Point School comprises what is known as a deferred selection property under the Crown’s settlement arrangements with Rangitāne o Wairau. In its written submissions, the Crown explained the position in these terms:
Auckland Point School is a deferred selection property under the deed of settlement with Rangitane (a Kurahaupo iwi). Clause 6.10 of the deed of settlement provides that at any time during the three year period commencing on the settlement date, the governance entity may purchase deferred selection properties on the terms and conditions in part 3 of the property redress schedule.
Part 3 of the property redress schedule provides for the governance entity to give notice of its interest in purchasing the property. It further provides for a valuation process, and for the entity to elect to purchase. If an election occurs, the Crown “shall be deemed to have entered into an agreement for the sale and purchase of the property” on the terms set out in the deed.6
[17] Victory Primary School and Maitai Primary School comprise what are known as commercial redress properties under the Crown’s settlement arrangements with Ngāti Rārua and Ngāti Kōata respectively. In its written submissions the Crown explained the position in these terms:
The Ngāti Rarua and Koata deeds of settlement state that the Crown “will transfer” the properties to the iwi governance entities, in accordance with the terms set out in the respective property redress schedules.7 The property redress schedules state that the Crown “must transfer the fee simple estate” of the commercial redress properties to the governance entities.
[18] The value of the commercial redress properties is deducted from the overall settlement payment for financial and commercial redress ($11,760,000 in the case of each of Ngāti Rārua and Ngāti Kōata).
[19] Each of those schools, when and if transferred to iwi, will be leased back to the Crown on perpetually renewable terms.
5 The Ngāti Apa ki te Rā Tō, Ngāti Kuia, and Rangitāne o Wairau Claims Settlement Act 2014 (the Kura-Haupo Settlement Act) and the Ngāti Koāta, Ngāti Rārua, Ngāti Tama ki Te Tau Ihu, and Te Atiawa o te Waka-a-Māui Claims Settlement Act 2014 (the Tainui-Taranaki Settlement Act).
6 Deed of Settlement of Rangitāne o Wairau, Property Redress Schedule at Part 3.1, cl 2.11.
7 Ngāti Rārua and Ngāti Kōata Deeds of Settlement at cl 6.4.
The lapse of caveats – the law
[20] Wakatū and the Crown agree that the legal principles applying to applications to sustain or remove the caveat can be summarised as follows:8
(a) The onus rests on the caveator to demonstrate they have a reasonably arguable interest in the land.
(b)The caveator must put forward a reasonably arguable case to support the interests that it claims in the Caveated Land.
(c) An order for the removal of the caveat will only be made if it is clear that there was either no valid ground for lodging it in the first place or, alternatively, that such ground as then existed has now ceased to exist.
(d)Applications to sustain a caveat are wholly unsuitable for the determination of disputed questions of fact.
(e) The Court has a residual discretion to remove a caveat where there is no practical advantage in its continuance, even if it protects an otherwise caveatable interest; however this discretion is to be exercised cautiously.9
[21] The Crown says that the following principles are also relevant:
(a) An applicant claiming to be beneficially interested in any land by virtue of any trust, express or implied, must be able to show the existence of a trust that confers upon them a beneficial interest in the land sought to be caveated.10 A remedial constructive trust does not give rise to a caveatable interest. A caveat can be maintained where
an institutional constructive trust exists.11
8 Paugra Holdings Ltd (in liq) v Harvestfield Holdings Ltd [2014] NZCA 164, (2014) 26 NZTC
21-070 at [34]–[35] per White and Heath JJ; Olo Ltd v KA No 3 Trustee Ltd [2014] NZHC 1075 at [4]–[5].
9 Cressida Capital One Ltd v Mapp [2013] NZHC 1666 at [15] and [18].
10 Merbank Corporation Ltd v Price (1978) 1 NZCPR 24 (SC) at 28 per McMullin J. See also Holt v Anchorage Management Ltd [1987] 1 NZLR 108 (CA) at 114 per McMullin J.
11 Paugra Holdings Ltd (in liq) v Harvestfield Holdings Ltd, above n 8, at [37]; Cressida Capital
(b)A caveat may be lodged only by a person upon whom a right to lodge it has been conferred by the statute.12 It is not enough to show that the lodging and continued existence of the caveat would be in some way advantageous to the caveator.13
(c) An applicant must show they have a reasonably arguable interest in the specific land subject to the caveat.14 The equitable interest claimed must be able to give relief against the land itself.15
(d)A caveator must have a present, as distinct from a potential, interest in land.16
(e) The basis on which a caveat is lodged is the only basis on which it can be defended or sustained.17
The parties’ positions
[22] Two essential issues are involved in the opposing claims of the Crown and Wakatū. The first is whether, as argued for in the Wakatū proceedings, Wakatū as caveator has a reasonably arguable claim to a beneficial interest in the Caveated Land. The second is the extent to which that claim is preserved by the Settlement Acts, in face of the general settlement of historical claims effected by those Acts and the extinguishment by those Acts of the Court’s jurisdiction regarding those claims.
The Wakatū proceeding- a reasonably arguable claim?
[23] Wakatū says it has a reasonably arguable claim to a beneficial interest in the
Caveated Land on the basis of the arguments it (unsuccessfully) advanced in this
Court in the Wakatū proceedings.18 Though unsuccessful before me, Wakatū, and the
One Ltd v Mapp, above n 9, at [21]; Philpiah v Ministry of Health HC Auckland M1038-IM01,
5 February 2002 at [23].
12 The relevant statutory provision being s 137 of the Land Transfer Act 1952.
13 Guardian Trust and Executors Co of NZ Ltd v Hall [1938] NZLR 1020 (CA) at 1025;
Simperingham v Martin HC Auckland CP316/93, 19 October 1994 at 12.
14 Merbank Corporation Ltd v Pria, above n 10, at 27.
15 Wellesley Club Inc v Wellesley Property Holdings Ltd HC Wellington CIV-2006-485-2688,
15 March 2007 at [36].
16 Philpott v NZI Bank Ltd (1989) 1 NZ ConvC 190, 246 (CA) at 4-5 (per Cooke P).
17 Colin Adams Ltd v Baker CA178-98, 5 May 1999 at [5]-[6].
18 Proprietors of Wakatū Inc v Attorney-General, above n 2.
other plaintiffs, have appealed to the Court of Appeal. The arguments advanced for express, constructive and resultant trusts, and breaches of fiduciary duty, although novel and, in an historic sense, unusual, are nevertheless – Wakatū says – reasonably arguable. That is not a high threshold. Although I found against Wakatū, my judgment in effect acknowledged that the claims were reasonably arguable.
[24] Moreover, the Caveated Land has, from the outset of the Wakatū proceedings, been identified by Wakatū as land which either originally comprised the Nelson Tenths, and was subsequently dealt with by the Crown in breach of the trusts applying to that land or otherwise in breach of Crown duties, or – in the case of the land subject to Caveats 1 – 7, should have been reserved for Māori as comprising part of the Matangi Awhio pā at Auckland Point.
[25] The Crown responds by emphasising that Wakatū was unsuccessful in the Wakatū proceedings. Therefore, on the current state of the law Wakatū has been found not to have, by whatever route it might assert, the beneficial interest it purports to protect by the Caveats. Therefore, Wakatū does not have a reasonably arguable claim to those beneficial interests.
[26] Moreover, Wakatū has not established an entitlement to the Caveated Land. The complex history of the dealings in that land established that the Auckland Point Caveated Land was never part of the Nelson Tenths, and that the Caveated Land at Victory and Maitai Schools was lawfully dealt with by the Crown. Whatever general breaches of legal duty Wakatū asserts, it does not have a reasonably arguable case to a beneficial interest in the specific land in question.
To what extent do the Wakatū proceedings survive?
[27] The Settlement Acts are intended to settle, on a full and final basis, the historical claims of the iwi involved. They also oust the jurisdiction of the Courts as regards those claims. At the same time, the Wakatū proceedings, at the appellate level, remain on foot. Section 25 of the Tainui-Taranaki Settlement Act provides:
25 Settlement of historical claims final
(1) The historical claims are settled.
(2) The settlement of the historical claims is final and, on and from the settlement date, the Crown is released and discharged from all obligations and liabilities in respect of those claims.
(3) Subsections (1) and (2) do not limit the acknowledgements expressed in, or the provisions of, the deeds of settlement.
(4) Despite any other enactment or rule of law, on and from the settlement date, no court, tribunal or other judicial body has jurisdiction (including the jurisdiction to inquire or further inquire, or to make a finding or recommendation) in respect of–
(a) the historical claims; or
(b) the deeds of settlement; or
(c) this Act; or
(d) the redress provided under the deeds of settlement or this Act.
(5) Subsection (4) does not exclude the jurisdiction of a court, tribunal, or other judicial body in respect of the interpretation or implementation of the deeds of settlement or this Act.
(6) Subsections (1) to (5) do not affect–
(a) the ability of a plaintiff to pursue the appeal filed in the Court of
Appeal as CA 436/2012; or
(b) the ability of any person to pursue an appeal from a decision of the
Court of Appeal; or
(c) the ability of a plaintiff to obtain any relief claimed in the Wakatū
proceedings to which the plaintiff is entitled.
(7) To avoid doubt, subsection (6) does not preserve any claim by or on behalf of a person who is not a plaintiff.
(8) In this section,–
plaintiff means a plaintiff named in the Wakatū proceedings
Wakatū proceedings means the proceedings filed in the High
Court as CIV-2010-442-181.
[28] Wakatū argues that s 25(6) explicitly preserves the claims it and the other plaintiffs have made in the Wakatū proceedings from what would otherwise be the ouster of the Court’s jurisdiction effected by s 25(4).
[29] The Crown acknowledges that s 25(6) preserves claims made in the Wakatū proceedings by the plaintiffs on their own behalf, but not on behalf of the customary groups for whom they purport to act. As the claims of beneficial entitlement to the
Caveated Land are made on behalf of those groups, those claims are settled and there is no continuing jurisdiction after the settlement date for those claims to be maintained. Hence Wakatū cannot say it has a reasonably arguable claim to a beneficial interest in the Caveated Land.
The position of the interveners
[30] In the Wakatū proceedings the interveners generally supported Wakatū’s account of the historic narrative and its claims of breach by the Crown of relevant obligations. The interveners argued, however, that Wakatū and the other plaintiffs did not have standing to bring those claims, and that the claims should be settled through the Treaty settlement process. Reflecting those positions Ngāti Rārua and Ngāti Kōata filed a written memorandum supporting the Crown’s position that Wakatū did not now have and was not entitled to assert any equitable or other interests of any substance in the Caveated Land so as the justify the continuation of the Caveats.
Analysis
[31] Although the Crown agreed with Wakatū’s synthesis of relevant legal principles, at the same time it said the approach taken in Apa v Levin applied where, as here, caveats were lodged pending an appeal.19 In Apa, and applying the authority
of Kiwi Freeholds Queen Street Ltd v Shanty Holdings Ltd,20 Associate Judge
Robinson summarised the relevant principles as follows:21
a) A successful party is prima facie entitled to the fruits of the judgment.
b) The Court has an inherent jurisdiction to make orders ensuring the position to ensure that any appeal is not rendered nugatory.
c) The fact that one remedy (eg specific performance) may not be available if a caveat is removed does not render an appeal nugatory if other relief (eg damages) is still available.
d) Other relevant considerations will include:
i) Whether the appeal is brought bona fide.
19 Apa v Levin HC Auckland CIV-2009-404-4652, 15 December 2009.
20 Kiwi Freeholds Queen Street Ltd v Shanty Holdings Ltd [2007] 8 NZCPR 517.
21 At [18].
ii) Whether the successful party will be injuriously affected by the maintenance of the caveat.
iii) The overall balance of convenience.
[32] Of particular relevance here would be the proposition that the fact that one remedy (eg specific performance) may not be available if a caveat is removed does not render an appeal nugatory if other relief (eg damages) is still available.
[33] On the basis that Apa and Kiwi Freeholds set out what would appear to be a conceptually different set of principles than those agreed by the Crown and Wakatū as applying here, it may be that the Crown could have made more of that approach than it sought to do.
[34] Having said that, by my assessment the point here is that Wakatū has argued from the outset that its claims to the Caveated Land are made by reference to the special status of that land. In the case of Victory and Maitai Primary Schools, the Caveated Land is part of the few original Nelson Tenths sections still owned by the Crown. In the case of Auckland Point, the Caveated Land is part of the Matangi Awhio pā as it existed in 1842 which, although not reserved as a Nelson Tenths section, should nevertheless have been reserved from the land transferred to the New Zealand Company and its settlers and which, as a matter of fact, is now owned by the Crown. Wakatū’s appeal would thus be rendered nugatory if the Caveats lapsed.
[35] The remaining considerations in the Apa and Kiwi Freeholds approach do not significantly differ from those the Crown and Wakatū agreed I should consider. The consideration of whether the appeal is bona fide is broadly analagous to the question of whether Wakatū has a reasonably arguable claim to the land.22 The primary issue for me here is therefore “whether there is a serious issue to be tried, as to the validity
of the claim”.23
22 Apa v Levin, above n 19 at [30]; Kiwi Freeholds Queen Street Ltd v Shanty Holdings Ltd, above n 20, at [26].
23 Holt v Anchorage Management Ltd [1987] 1 NZLR 108 (CA) at 119, per Somers J.
[36] In the Wakatū proceedings as argued before me in the High Court, the plaintiffs advanced six separate causes of action, the common theme of which was an assertion of:24
…the unconscionable action of the Crown in “representing” the interests of tangata whenua of western Te Tau Ihu but failing to protect their entitlement to one-tenth of the land acquired for the Nelson settlement. The result was that the Crown retained land that it did not own.
[37] Wakatū advanced its claim by reference to three conceptually distinct areas of land, the Shortfall, the Uplift and the Diminution. The first three of the causes of action addressed each of those specific areas of land in terms of the claimed express trust. The second group of three causes of action was based on more general equitable principles involving breach of fiduciary duties, unconscionable or fraudulent behaviour giving rise to an institutional constructive trust and, finally, breach of a more general relational duty of good faith giving rise to a remedial constructive trust.
[38] The Caveated Land was land that, although still owned by the Crown, was pursuant to the constructive or institutional constructive trusts claimed beneficially owned by iwi. Alternatively, it was land which should by way of remedy for breach be returned to iwi.
[39] Whilst I found against the plaintiffs on all the grounds of entitlement advanced in the Wakatū proceedings, I think my judgment reflects that I found Wakatū’s claims, including to the extent of the claimed beneficial interest in the Caveated Land, reasonably arguable. The claims are novel, and difficult: they also build on jurisprudence dealing with the Crown’s relationship with indigenous groups that has not yet been recognised in New Zealand. But that, I am clear, does not mean that the claims are not reasonably arguable.
[40] I am of the view that the more difficult question, in terms of these applications, involves the inter-related questions of whether Wakatū has standing to
bring those claims and the effect of s 25 of the Tainui-Taranaki Settlement Act.
24 Proprietors of Wakatū Inc v Attorney-General, above n 2, at [29].
[41] The phrase “historical claims” is defined in s 24(2) of that Act in the following terms:
(2) The historical claims are every claim that a settlement iwi or a representative entity had on or before the settlement date, or may have after the settlement date, and that–
(a) is, or is founded on, a right arising–
(i) from the Treaty of Waitangi or its principles; or
(ii) under legislation; or
(iii) at common law (including aboriginal title or customary law); or
(iv) from fiduciary duty; or
(v) otherwise; and
(b) arises from, or relates to, acts or omissions before 21 September 1992–
(i) by, or on behalf of, the Crown; or
(ii) by or under legislation.
[42] The term “settlement iwi” is defined to mean each of the following iwi:25
(a) Ngāti Kōata; (b) Ngāti Rārua;
(c) Ngāti Tama ki Te Tau Ihu;
(d) Te Ātiawa o Te Waka-a-Māui.
[43] The term “representative entity” is defined to mean:26
(a) the trustees of each settlement trust; and
(b) any person (including any trustees) acting for, or on behalf of,–
(i) the collective group referred to in paragraph (a) of the definition of Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki Te Tau Ihu, or Te Ātiawa o Te Waka-a-Māui in section 23(1); or
(ii) 1 or more members of Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki
Te Tau Ihu, or Te Ātiawa o Te Waka-a-Māui; or
(iii) 1 or more of the whānau, hapū, or groups referred to in paragraph (c) of the definition of Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki Te Tau Ihu, or Te Ātiawa o Te Waka-a-Māui in section 23(1).
25 Section 22.
26 Section 21.
[44] Subsections (3) through (6) of s 24 also contain inclusive definitions of the term “historical claims” as they apply to each of Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki Te Tau Ihu and Te Ātiawa o Te Waka-a-Maui. Those extended definitions all refer to Wai 56, the claim to the Waitangi Tribunal that most particularly focussed on grievances relating to the Nelson Tenths.
[45] As I understand matters, given those various definitions and, in particular, that of representative entity, it is accepted by Wakatū and the Crown that the historical claim advanced in the Wakatū proceedings would have been settled by s 25(1) and the Court’s jurisdiction to consider the Wakatū proceedings would have
been ousted by s 25(4), were it not for the provisions of s 25(6).27
[46] The question these applications raise, therefore, is the effect of s 25(6) and
(7), taken together.
[47] This is an issue which has been raised by the Crown in the Court of Appeal in CA436/2012. The Court gave leave after the hearing of that appeal had been completed for submissions on the issue to be filed.
[48] Wakatū says s 25(6) means what it says: that is, the plaintiffs in the Wakatū proceedings may continue to pursue their appeals and the ability of those plaintiffs to obtain any relief claimed in the Wakatū proceedings is not affected by the settlement or jurisdictional ouster provisions of ss 25(1) and (4).
[49] The Crown’s interpretation of ss 25(6) and (7) was summarised in its written submissions in the following terms:
86.3 The effect of this is, in sum, that the legislation:
86.3.1 Does not bar the plaintiffs’ express trust claims being pursued on appeal, in so far as they seek recognition of existing property rights under such trusts. The settlement legislation does not extinguish property rights that arise independently of
27 Wakatū and the Te Kāhui Ngahuru Trust are very clearly representative entities as defined. Less obviously Mr Stafford would also appear to be covered by the definition given that he is a person acting on behalf of collective groups, persons or whānau, hapū or groups as referred to in subclauses (1)(i), (ii) and (iii) of subparagraph (b) of the definition of representative entities in s 21.
allegedly wrongful acts or omissions of the Crown;
but
86.3.2 Does bar:
(a) any claim against the Crown for breach of trust in respect of those express trusts;
(b) the claims advanced by the plaintiffs based on breach of fiduciary duties or other equitable duties owed to the customary owners of the relevant lands: namely the settlement iwi, including the whānau and hapū of those iwi;
unless those claims come within the exception in s 25(6).
87. Section 25(6) (and 26(7) and (8)) were inserted to address the
Incorporation’s appeal.
88.The purpose of s 25(6) is to protect the rights of the specific persons named as plaintiffs in the Wakatū proceedings, while ensuring that the settlement with the settling iwi is effective according to its terms. In particular, it would be inconsistent with the agreed settlement for the settling iwi to obtain remedies for historical claims through the Wakatū proceedings, which they did not commence or pursue, which are not brought on their behalf or with their approval, and which fall within the scope of the claims that they have agreed to settle.
[50] As I indicated during the hearing of these applications, I have some difficulty in understanding the relevance for these proceedings of the Crown’s submissions at
86.3.1. In the Wakatū proceedings, the Crown denies that there are any existing property rights with respect to the Nelson Tenths land, and land which comprised pā, urupā or cultivation grounds. The heart of Wakatū’s claim is to property rights that, by reference to wrongful acts or omissions of the Crown, have not been recognised. Be that as it may, and more importantly for these purposes, the Crown argues that s 25(7) limits the preservation provided by s 25(6) to claims made by the plaintiffs on their own behalves. The Crown submits that if s 25(7) did not limit s 25(6) in this way then, contrary to the legislative aim of settling historic claims, s 25(6) would allow the claims pursued in the Wakatū proceedings to continue. That would be fundamentally inconsistent with Parliament’s intention in passing the Settlement Acts.
[51] It is very clear, therefore, that a degree of preservation was intended, as is obvious from the statutory provisions themselves.
[52] In support of its interpretational argument, the Crown filed an extensive affidavit of Mr Russell Bates, the Deputy Director of Strategic Policy at the Office of Treaty Settlements. In his affidavit Mr Bates went in some detail into the background to s 25, and subsections (6) and (7) in particular. I have reservations about the admissibility, for the purposes of statutory interpretation, of the material referred to in that affidavit to the extent it is not on the Parliamentary record. Having said that, in the report of the Select Committee to the House of Representatives there
is a useful commentary on those provisions, which I now set out in full:28
Wakatū Incorporation
Clause 214 of the bill states that all historical claims of Ngāti Kōata, Ngāti Rārua, Ngāti Tama ki Te Tau Ihu, and Te Ātiawa o Te Waka-a-Māui are settled, but clause 214(6) would exclude specified court proceedings by Wakatū Incorporation and others against the Crown from this final settlement. The incorporation opposed the inclusion of Wai 56, of which it claims to represent a majority of claimants, in the bill. The bill would settle only the historical aspects of Wai 56, while the contemporary elements will not be settled. The Crown negotiated the settlements that led to the bill on the understanding that it would settle all historical claims of people who whakapapa to the iwi, rather than on the basis of shareholding of corporate entities such as the Wakatū Incorporation. We believe it appropriate that redress go to iwi entities that are mandated to represent iwi interests.
We recognise that there are issues regarding property rights, and the bill as it stands does not extinguish recourse to the courts. We received the following advice from the Office of Treaty Settlements, in consultation with the Crown Law Office:
The current orthodox position is that the Treaty of Waitangi does not give rise to directly enforceable legal obligations without specific statutory authority. In the Wakatū proceeding the claims are based around the same factual grievances that are the subject of the settlement, but primarily raise private law claims based in trust and fiduciary duty, not based on the Treaty breach. The ability to prosecute certain private law claims raised in Wakatū may be impacted by extinguishment provisions of the Tainui Taranaki Treaty settlements and their extinguishment clause, unless expressly preserved. Crown Law advice was sought on this matter and ultimately, it was considered … improper to obstruct final determination in the appellate courts. Legislative drafting was developed to specifically apply a preservation clause only to the current litigation and specific parties to that litigation.
[53] The observation “legislative drafting was developed to specifically to apply a preservation clause only to the current litigation and specific parties to that litigation” does throw light on the purpose behind s 25(6) and (7), but may do little more than reflect the wording of those provisions themselves.
[54] The issue of the preservation of the Wakatū proceedings was also referred to by a number of speakers during the second reading debate. Those remarks included the following comments from the Honourable Nanaia Mahuta:29
In terms of Wakatū, this is another area where the Wakatū Incorporation put its interests before the select committee and said that some of the private shareholding interests underneath its purview would be significantly affected by terms in the bill. Our mind was tasked around two particular things – firstly, the cluster of Te Tau Ihu claimants actually did originally include members who were advocating for Wakatū, and some way through the process, if I recollect the discussion, those interests had fallen away from continuing with the negotiation. The second key point was that this is an iwi settlement; this is not a private shareholder settlement. The fundamental difference is that some of the shareholders of Wakatū are not members of the iwi who will benefit from the settlement. So we kind of teased that out and got ourselves sufficiently comfortable with the fact that the clause protecting or preserving the 1egal interests that currently exists in the bill covers off all the concerns that Wakatū were concerned about.
But can I put on the record, because we wanted to make absolutely sure, that we sought advice both from the Office of Treaty Settlements and the Crown Law Office in terms of that significant submission. I will read the advice that we got back from the Crown Law Office for the benefit of those who are listening and are interested in the debate. It says:
[as above at [52]]
I have read that quote for the benefit of Tainui Taranaki so that they are clear in terms of the way in which the select committee approached this issue and reconfirmed that the bill should not be changed in this regard.
[55] I was also referred to an open letter Wakatū had written to all members of Parliament, and to the reply to that letter the responsible Minister had circulated in like manner.
[56] By reference to that material on the Parliamentary record, the words of s 25 itself and the general context provided by the Settlement Acts, the Crown’s argument was that s 25 was not intended to allow Wakatū, as it claims here, to advance interests on behalf of members of the iwi who had signed full and final settlement deeds with the Crown, and were to receive the benefit of full and final settlements as provided by the Settlement Acts.
[57] Wakatū responds that to interpret the combined effect of s 25(6) and (7) in
that way is to render the obviously intended preservation of the Court’s jurisdiction
over the Wakatū proceedings completely ineffective. That is, what s 25(6) appears to give would, on the basis of that interpretation, be taken away by s 25(7). From the outset, the plaintiffs have taken the Wakatū proceedings on behalf of others: in this context, Wakatū emphasise the role of Mr Stafford, as a kaumatua having traditional authority – as reflected in the many claims brought over time in the Courts of New Zealand in the names of individual rangatira and kaumatua on behalf of iwi, hapū and whanau, to bring proceedings on behalf of those for whom he has traditional responsibility. Having said that, Wakatū did not itself directly engage in suggesting a meaning for s 25(7): rather it focused on what it said was the obvious intention of Parliament in s 25(6) to preserve the Wakatū proceedings.
[58] I am clearly not in a position, in these proceedings, to resolve what appears to me to be a not straightforward question of statutory interpretation. As I have said, the matter is currently directly before the Court of Appeal.
[59] The extent to which I can assess that issue at the present time is that, on the Crown’s own interpretation s 25(6) does preserve, albeit to a somewhat uncertain extent, the Wakatū proceedings as they are now before the Court of Appeal.
[60] There is some force to the Crown’s argument that accepting Wakatū’s argument would not only affect the Caveated Land, but also the inclusion within the settlement arrangements with Tainui-Taranaki and Kurahaupo iwi of the broad sweep of Crown land in Te Tau Ihu that Wakatū might seek by way of remedy were it to succeed in the Wakatū proceedings. That could have a significant impact on the settlements to be effected by the Settlement Acts.
[61] I think the response to that argument is that it is only the Caveated Land that, as a matter of fact, Wakatū seeks to protect from Settlement Act transactions, not Crown land more generally.
[62] On the other hand, I acknowledge Wakatū’s submission as to the difficulty of reconciling the Crown’s view of the effect of s 25(7), with the obvious statutory intent that the Wakatū proceedings are in terms of the private law claims made by the plaintiffs, to be able to continue. Those proceedings have, from the outset and as I think my judgment in Wakatū shows, been brought by the plaintiffs on behalf of
others. The plaintiffs were asserting private legal rights, in particular under their claims for resulting and constructive trusts. But it was clear from the outset that the beneficiaries of those trusts, and hence of the claims, were the members of customary groups even if the way the plaintiffs characterised the nature and make-up of the customary groups is in question. As matters currently stand, and accepting that I heard only limited argument on these matters as was inevitable, I have some difficulty understanding what aspect of the Wakatū proceedings are preserved if the Crown’s interpretation of s 25(7) is correct. By my assessment, it is reasonably arguable that that interpretation is not correct, and therefore on that basis that the claim to a beneficial interest in the Caveated Lands that Wakatū makes remains reasonably arguable. For these purposes I think it is also significant that that very argument is fully before the Court of Appeal, and that it has not previously been considered in that way.
[63] I therefore conclude that, having regard to the current status of the Wakatū proceedings and the difficult issue of the correct interpretation of the combined effect of ss 25 (6), (7) and (8), that the applicant does have a reasonably arguable claim to a beneficial interest in the Caveated Land sufficient, at this point, to sustain the Caveats.
[64] The question now becomes whether, in my discretion, I should nevertheless decline Wakatū’s application that the Caveats not lapse, and allow that of the Crown, or, on the Apa and Freeholds approach whether the balance of convenience favours maintenance of the Caveats.
[65] The proper approach here, in my view, is to balance the importance of the settlements provided for by the Settlement Acts proceeding according to their terms against the importance of maintaining the Caveats which would prevent dealings with the Caveated Land. I note here that there is, perhaps, not quite the urgency regarding these matters that was first asserted. That is, caveats 1 to 7 will not immediately preclude a dealing: that situation will only arise if, in the first instance, Rangitāne o Wairau elect within three years to have the Auckland Point land transferred to it as a deferred selection property. In the case of Victory and Maitai Schools, the Crown advised at the hearing on 25 July 2014 that the current
unavailability of titles to at least some of that land would preclude an immediate dealing.
[66] But, putting those matters to one side, more fundamentally I am of the view that the balance of convenience, as it were, favours preservation of the status quo. The Caveated Land is but a small part of the settlement transactions occurring on and after 1 August 2014. There are, and have been throughout the Wakatū proceedings, strong differences of view as to the approach to be taken to the issues
raised by the history of the Nelson Tenths. As I said in the Wakatū judgment itself:30
[12] Since the publication of the Tribunal’s 2008 report the Tainui- Taranaki iwi Ngāti Kōata, Ngāti Rārua, Ngāti Tama, and Te Ātiawa have initialled deeds with the Crown to settle their Treaty claims. Such settlements would, when those deeds have been formally executed and legislated for, extinguish any private law rights that might exist in regard to the Nelson Tenths, including those which the plaintiffs claim in these proceedings. Formal execution of those deeds, and the passage of settlement legislation, is currently on hold pending the outcome of these proceedings. That is a matter of considerable tension between the parties.
[13] By commencing these proceedings, the plaintiffs can be understood as saying they are not satisfied with either or both of the process for, and substantive outcome of, the negotiations which have led to the initialling of those deeds by those Tainui-Taranaki iwi, and the settlements they foreshadow.
[67] The history of the Nelson Tenths has been contentious from the outset, over
170 years ago. I do not think substantial harm would be done to the settlements generally if the Caveated Land is not immediately dealt with as it might otherwise have been if the Caveats were to lapse. My overall assessment is that allowing for Wakatū’s claim to be finally dealt with through the appeal process, and whilst that process is being completed to hold back the Caveated Land from formal dealings to effect the settlements, is a preferable outcome to that of, as regards that land, bringing the Wakatū proceedings to an end by allowing the Caveats to lapse. Given that the Caveated Land is, under the Settlement Acts, essentially being dealt with as income generating endowment properties, other arrangements may be able to be made to achieve the economic effect intended by that legislation, without formal
transfers of that land being registered.
30 Proprietors of Wakatū Inc v Attorney-General, above n 3.
Outcome
[68] I therefore grant Wakatū’s application in CIV-2014-442-47 that the Caveats
not lapse, and decline the Crown’s application to the opposite effect in CIV-2014-
442-49.
[69] All questions of costs are reserved.
“Clifford J”
Solicitors:
Pitt & Moore, Nelson for applicant/respondent
Crown Law Office, Wellington for respondent/applicant
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