Tahi Enterprises Limited v Taua
[2020] NZHC 2891
•4 November 2020
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2017-404-000435
[2020] NZHC 2891
BETWEEN TAHI ENTERPRISES LIMITED
First Plaintiff
DIANNE LEE
Second PlaintiffAND
TE WARENA TAUA and MIRIAMA
TAMAARIKI as executors of the estate of HARIATA ARAPO EWE
First DefendantsTE WARENA TAUA, GEORGE HORI WINIKEREI TAUA, NGARAMA WALKER, HAMUERA TAUA and
MIRIAMA TAMAARIKI as trustees of the TE KAWERAU IWI TRIBAL AUTHORITY
Second Defendants
TE WARENA TAUA, GEORGE HORI WINIKEREI TAUA, NGARAMA WALKER, HAMUERA TAUA and
MIRIAMA TAMAARIKI as trustees of the TE KAWERAU SETTLEMENT TRUST
Third Defendants
Hearing: 7 August 2020 Appearances:
C Upton for the Plaintiffs
J S Langston for the Defendants
Judgment:
4 November 2020
JUDGMENT OF ASSOCIATE JUDGE GARDINER
TAHI ENTERPRISES LTD v TE WARENA TAUA & Ors [2020] NZHC 2891 [4 November 2020]
This judgment was delivered by me on 4 November 2020 at 3.30 p.m. pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date.......................................
Introduction
[1] This is an application by the plaintiffs for particular discovery under r 8.19 of the High Court Rules 2016. The plaintiffs seek discovery of any register(s) of the individual members of the Te Kawerau ā Maki iwi (“the Iwi”) in the control of the defendants (“the Register”). They also apply for discovery of other specific documents and object to redactions made and confidentiality claimed by the defendants in relation to certain further documents.
[2] There have been two previous decisions by this Court on interlocutory applications by the plaintiffs. An application by the plaintiffs for an order under r 4.24 of the High Court Rules appointing the third defendants as the representatives of all affected Iwi members was dismissed by Lang J in a judgment delivered on 26 March 2018 (“the Representation Judgment”).1
[3] An application for discovery of the register of Iwi members under r 8.20 of the High Court Rules was heard by Associate Judge Smith on 6 July 2018. In a judgment delivered on 18 December 2018, Associate Judge Smith ordered the second and third defendants to give discovery of the Register, with details of Iwi members under the age of 18 (as at 27 June 2007) redacted (“the Pre-commencement Discovery Judgment”).2 The second and third defendants appealed Associate Judge Smith’s judgment and the plaintiffs cross-appealed. The Court of Appeal heard the appeal on 9 June 2020 but has not yet delivered its judgment.
1 Tahi Enterprises Ltd v Taua [2018] NZHC 516 [Representation Judgment].
2 Tahi Enterprises Ltd v Taua [2018] NZHC 3372 [Pre-commencement Discovery Judgment].
[4] An interlocutory application by the plaintiffs to consolidate these proceedings with proceedings CIV-2019-404-1589 was also heard with the present application. The outcome of that application is the subject of a separate judgment.
[5] Between the plaintiffs filing their application and the hearing, a number of the discovery issues were resolved or progressed to the point that court orders are unnecessary (namely those at paras 1(b)(i), (ii), (iii), (v), (vi), (vii) and (viii) of the plaintiffs’ application for particular discovery dated 26 June 2020). The remaining documents at issue, which this judgment addresses, are:
(a)the Register of Iwi members (para 1(a));
(b)hui attendance registers (para 1(b)(iv) and (vi));
(c)confidentiality claimed in various documents (para 1(c) and 1(d));
(d)a memorandum of understanding (para 1(e)).
The parties
[6] The first plaintiff, Tahi Enterprises Ltd (“Tahi”), is an Auckland-based incorporated company. The second plaintiff, Dianne Lee (Mrs Lee), is a commercial manager and she is also the sole shareholder and director of Tahi.
[7] The first-named first defendant, Te Warena Taua, is a rangatira of the Iwi. The Iwi is a collective group comprised of individuals descended from an ancestor of Te Kawerau ā Maki.
[8] The second-named first defendant, Miriama Tamaariki is the executor of the estate of Hariata Arapo Ewe, who before her death in August 2009 had been a senior member of the Iwi. Mr Taua and Ms Ewe were claimants on behalf of the Iwi in the Iwi’s Wai 470 claim in the Waitangi Tribunal and in the Wai 1362 claim in relation to the Crown’s Tāmaki Makaurau settlement process. Mr Taua was also a claimant on behalf of the Iwi in the Wai 2401 claim in the Waitangi Tribunal.
[9] The second defendants are the trustees of a charitable trust established by Mr Taua on behalf of the Iwi on 13 July 2008, known as the Te Kawerau Iwi Tribal Authority (“the Tribal Authority”). The Tribal Authority was registered under the Charitable Trusts Act 2005 on 23 July 2009, for purposes including the negotiation and settlement with the Crown of all historical Treaty of Waitangi claims of the Iwi and the management of any settlement assets for the benefit of the people of the Iwi. Mr Taua was the chairman of the Tribal Authority.
[10] The third defendants are the trustees of a trust known as the Te Kawerau Iwi Settlement Trust (“the Settlement Trust”). The Settlement Trust was established in February 2014. Among the purposes of the Settlement Trust was representation of the interests of the Iwi, and the receipt and administration of settlement assets received by the Iwi as part of settlement with the Crown. Mr Taua was the chairman of the Settlement Trust.
Background
Factual background
[11] The following description of the factual background and the plaintiffs’ claims is substantially taken from the Representation and Pre-commencement Discovery Judgments of Lang J and Associate Judge Smith respectively. The statement of claim has been amended since the original pleading considered by Lang J. The hearing before Associate Judge Smith proceeded on the basis of a draft second amended statement of claim, the final version of which (dated 4 July 2019) is relevant to this application.
[12] In their second amended statement of claim, the plaintiffs plead five causes of action. All of them arise out of dealings between Mrs Lee and members of the Iwi during 2007 and 2008.
[13] The first of two joint venture agreements pleaded by the plaintiffs was dated 27 June 2007 (“the 2007 Agreement”). The named parties to the 2007 Agreement were Tahi and “Te Kawerau ā Maki”. Mrs Lee signed the document for Tahi, and
Mr Taua and Ms Piki Taylor for “Te Kawerau ā Maki”. Under the 2007 Agreement, Tahi agreed to provide funding of up to $2 million “in support of Te Kawerau’s Treaty claims process”. Tahi was required to pay $1 million within three working days of execution of the agreement, and the balance of the money was to be paid “within 2 months after signing of the Agreement in Principle with the Crown”.
[14] In consideration for receiving these sums, the Iwi agreed that Tahi would be the Iwi’s exclusive partner in all commercial developments undertaken using the proceeds of the settlement of the Iwi’s Treaty of Waitangi claims. Any profits from those undertakings would be shared 65 per cent to the Iwi and 35 per cent to Tahi. The Iwi warranted that they would procure any entity that received assets as part of the Iwi’s Treaty of Waitangi settlement with the Crown to honour the 2007 Agreement.
[15] The second joint venture agreement (“the Variation Agreement”) was signed on 22 July 2008 and purported to vary the 2007 Agreement. The parties were the same, and the signatories were Mrs Lee on behalf of Tahi, and Mr Taua and Ms Ewe on behalf of “Te Kawerau ā Maki”. The Variation Agreement recorded that Mr Taua and Ms Ewe had “authority to sign this agreement on behalf of Te Kawerau”.
[16] Under the Variation Agreement, “Te Kawerau ā Maki” was defined as “Te Kawerau ā Maki Iwi Tribal Authority”. The agreement said that that group comprised:
(i)The collective group comprised of persons:
(a)Who descend from the following ancestors:
(i)Tawhia ki te Rangi (also known as Te Kawerau ā Maki); and
(ii) Mana; and
(iii) Te Au o Te Whenua; and
(iv) Kowhatu ki te Uru
(ii)Every whanau, hapu or group of persons to the extent that the whanau, hapu or group includes persons referred to 4.i and
(iii)Every person referred to in clause 4.i.
[17]In addition, the Variation Agreement contained the following clause:
It is reasonably foreseeable that upon the successful settlement of the Treaty Claims with the Crown, Te Kawerau will use or form various entities (“related entities”) that are associated or controlled by Te Kawerau to govern, manage and develop all assets being settled. Both parties agree that this agreement should also be binding on all those related entities.
[18] Under the Variation Agreement, Tahi agreed to “provide total funding up to and not exceeding NZ $2 million … in support of Te Kawerau’s Treaty claims process”. The parties acknowledged that Tahi had already paid $1 million. The balance was to be paid in instalments of $200,000, $100,000 and $700,000, on the occurrence of specified events during the Treaty claims settlement process.
[19] A new provision (not present in the 2007 Agreement) required the Iwi to repay the sums paid by Tahi in accordance with the following clause:
13) As soon as Te Kawerau or any related entities receive any cash settlement (including and not limiting to accumulated rentals related to Crown Forest Licences) from the Crown of not less than $2,000,000, Te Kawerau agrees to ensure the prompt repayment of the sum of
$2,000,000 capital back to Tahi Enterprises. Payment to be made within two months of receipt.
[20] The Iwi granted Tahi a first charge against and claim on all assets of the Iwi and its related entities.
[21] The Variation Agreement reiterated that all profits and interest arising from “future business endeavours” were to be shared, 65 per cent to the Iwi and 35 per cent to Tahi. It also recorded that, save as varied by the Variation Agreement, the 2007 Agreement was to remain in full force and effect.
[22] In a third agreement, Mr Taua assigned to Mrs Lee his four per cent interest in the Iwi’s settlement with the Crown in return for a further advance of $220,000 and the transfer of a Mangere property, in which he had been living, as soon as she received
$800,000 from that share (“the Mangere Property Agreement”). Mrs Lee contends that she entered into a further agreement with Mr Taua, under which she leased the Mangere property to him.
[23] In this judgment I will refer to the 2007 Agreement, the Variation Agreement and the Mangere Property Agreement as “the Agreements”.
[24] On 7 August 2008 the Tribal Authority trustees and the Crown entered into an agreement setting out the terms of negotiation of the Iwi’s Treaty claims. The plaintiffs say that on 5 September 2008, Tahi paid $200,000 into a bank account nominated by Mr Taua in accordance with the Variation Agreement, and a further $100,000 into the same account in October 2008.
[25] On 12 February 2010, the Crown and the Iwi entered into a written agreement in principle to settle the Iwi’s Treaty claims. On 22 February 2014, the Crown entered into a deed of settlement with the Iwi and the Settlement Trust trustees, setting out the terms for settlement of the Iwi’s Treaty claims.
[26] The Te Kawerau ā Maki Claims Settlement Act 2015 came into force on 15 September 2015. Under this Act, the Iwi’s Treaty claims were settled on the basis that the Crown would transfer nominated properties to the Settlement Trust and would also make certain payments to them. In addition, the Crown granted the Settlement Trust the option to purchase several parcels of land, and the right of first refusal to purchase other parcels of land.
[27] Under the Ngā Mana Whenua o Tāmaki Makaurau Collective Redress Act 2014, the Iwi and twelve other iwi/hapu were collectively granted rights and interests by way of redress for historical Treaty breaches by the Crown. These included the ownership of certain parcels of land and the right to purchase other land.
[28] By letter dated 27 September 2016, the solicitors acting for the Iwi, the Tribal Authority and Mr Taua purported to cancel the 2007 Agreement as varied. Tahi and Mrs Lee then filed the present proceedings.
The plaintiffs’ claims
[29] The plaintiffs claim that all members of the Iwi over the age of 18 at 27 June 2007 (“the Contracting Iwi Members”) were parties to the Agreements. Mr Taua and
Ms Taylor are said to have had actual authority from the Contracting Iwi Members to execute the 2007 Agreement on their behalves, that authority being “express or … to be implied from the authority of the signatories as a matter of custom (which custom as a matter of common law will be informed by tikanga)”.
[30] The Contracting Iwi Members are also said to have been parties to the Variation Agreement; Mr Taua and/or Ms Ewe are said to have had authority to enter into the Variation Agreement on their behalves. Again, the authority is said to have been actual authority, express or implied as a matter of custom/tikanga.
[31] The plaintiffs also plead that Mr Taua and/or Ms Taylor (in respect of the 2007 Agreement) and Mr Taua and/or Ms Ewe (in respect of the Variation Agreement) executed the Agreements in an additional capacity, namely as trustees for all members of the Iwi from time to time (“the Benefitting Iwi Members”). The Contracting Iwi Members are also said to have entered into the Agreements as trustees for the Benefitting Iwi Members.
[32] The plaintiffs further contend that Mr Taua and/or Ms Taylor had the authority of the Contracting Iwi Members to manage the Iwi's interests under the 2007 Agreement, and that Mr Taua and/or Ms Ewe had similar authority under the Variation Agreement.
[33] The plaintiffs also say that Mr Taua executed the Variation Agreement as agent of the Tribal Authority trustees, and that, in entering into the Variation Agreement, the Tribal Authority trustees also became a party to the 2007 Agreement. Further, they contend that Mr Taua had the authority (actual authority, being either express or implied by custom/tikanga) of the Tribal Authority trustees to manage the Tribal Authority’s interests under the Agreements.
[34] The plaintiffs claim that Tahi made the first three payments to Mr Taua, Ms Taylor and the Contracting Iwi Members (together “the Iwi Parties”) each as agents or trustees of the Iwi and/or the Benefitting Iwi Members under the 2007 Agreement as varied by the Variation Agreement: $1 million on 29 June 2007, $200,000 on 5 September 2008, and $100,000 on 2 October 2008. The plaintiffs say that these
funds were held by the recipients for the benefit of the Iwi and were used to assist with advancing the Iwi’s claims under the Treaty of Waitangi.
[35] The plaintiffs’ first cause of action is against the Iwi Parties and the “Variation Iwi Parties” (being Mr Taua, Ms Ewe, the Contracting Iwi Members and the Tribunal Authority trustees). The plaintiffs allege that the 2007 Agreement (as varied) requires the Iwi Parties and the Variation Iwi Parties to procure the Tribal Authority trustees and the Settlement Trust trustees (and any other person who will receive settlement assets) to honour the terms of that agreement. By purporting to cancel and refusing to perform the 2007 Agreement (as varied), it is alleged that the Iwi Parties and Variation Iwi Parties have breached that agreement. Accordingly, the plaintiffs seek an inquiry into damages against those parties jointly and severally, or ancillary relief as the Court sees fit.
[36] In the alternative, if the 2007 Agreement (as varied) is found not be enforceable on its terms, the plaintiffs plead unjust enrichment and equitable compensation in the second cause of action. This cause of action is pleaded against the Iwi Parties, the Variation Iwi Parties and the Settlement Trust trustees. The plaintiffs claim that the Iwi and/or the Iwi Parties and Variation Iwi Parties were paid by Tahi and have received funds on the basis that Tahi would be the Iwi’s joint venture partner on the terms of the 2007 Agreement. The defendants have benefitted from the use of those funds, including by being able to advance the Iwi’s Treaty settlement claim ahead of other Auckland iwi, which had a positive bearing on the quantum of the Treaty settlement achieved. The defendants would be unjustly enriched if they were permitted to retain the benefits conferred on them on the basis that the 2007 Agreement (as varied) would be effective and honoured. The plaintiffs seek equitable compensation in the form of all of the funds Tahi paid under the 2007 Agreement (as varied) and a sum equivalent to the funding costs that the defendants would have had to incur to achieve a Treaty settlement with the Crown on the date it was achieved had Tahi not provided the funding.
[37] In the third cause of action, said to be against the Benefitting Iwi Members, Tahi seeks to be subrogated to certain trustees’ rights of indemnity out of the trust assets. The plaintiffs allege that the first defendants and Ms Taylor, the Contracting
Iwi Members and the Tribal Authority trustees and the Settlement Trust trustees, hold the settlement assets for the benefit of the Benefitting Iwi Members, and, to the extent the defendants are liable to Tahi and are entitled to indemnity from the settlement assets in respect of that liability, Tahi is entitled to be subrogated to the defendants’ indemnity rights and to a charge on the interest of the Benefitting Iwi Members in the settlement assets.
[38] The final two causes of action arise out of the Mangere Property Agreement. Mrs Lee says that she never received the share of the Treaty settlement assets Mr Taua purported to assign to her. In her fourth cause of action, she seeks an order requiring the Benefitting Iwi Members, the Tribal Authority trustees and/or the Settlement Trust trustees to perform the agreement and pay the not less than four per cent share to her as Mr Taua’s assignee or pay damages in lieu of specific performance. Mrs Lee also alleges that Mr Taua is now significantly in arrears with the rental payable for the Mangere property. In the fifth cause of action, she seeks judgment against Mr Taua for the unpaid rental.
Legal Principles
[39] Under r 8.19 of the High Court Rules a Court may make an order for particular discovery after the proceeding has commenced, where:
[I]t appears to a Judge, from evidence or from the nature or circumstances of the case or from any document filed in the proceeding, that there are grounds for believing that a party has not discovered 1 or more documents or a group of documents that should have been discovered …
[40] The starting point is that a document or class of documents will only be discoverable if relevant to the matters at issue before the Court. Only then can it be said that, in terms of the rule, they “should have been discovered”.
[41] The Court usually follows a four-stage approach in considering applications under r 8.19.3 First, are the documents thought relevant to issues before the Court, and if so, how important will they be? Secondly, are there grounds for belief that the
3 Assa Abloy New Zealand Ltd v Allegion (New Zealand) Ltd [2015] NZHC 2760, [2018] NZAR 600 at [14]; and McGechan on Procedure (online ed, Thomson Reuters) at [HR8.19.03].
documents exist? This will often be a matter of inference. Thirdly, is discovery proportionate (balancing the time and cost of discovery against the potential value of discovery)? Fourthly, weighing and balancing these matters, and in the Court’s discretion, is an order appropriate?
[42] This Court has previously observed that relevance is to be assessed according to the pleadings.4 In determining relevance, it is the case of the party seeking discovery that must be assumed to be true, not the party from whom discovery is sought. Further, the party seeking particular discovery has the onus of establishing that the party from whom discovery is sought is in control of document that should have been discovered under standard discovery.5
The Register of Iwi members — para 1(a)
[43] In terms of the four-stage approach to applications under r 8.19, there is no dispute that the Register exists. The time and cost involved in discovery of the Register would not be disproportionate. The issues in this application are:
(a)is the Register relevant to an issue before the Court in this proceeding?
(b)weighing up everything, is an order appropriate?
[44]The grounds relied on by the plaintiffs in their notice of application are:
(a)The identity of the Iwi members arises as an issue on the pleadings:
(i)Tahi alleges it is a party to the 2007 Agreement and Variation Agreement (“the JV Agreements”) with the Iwi members.
(ii)It is necessary for the plaintiffs to pursue enforcement of the JV Agreements against individual Iwi members because the defendants have asserted that the Iwi is not a legal entity capable of contracting or being sued.
4 Robert v Foxton Equities Ltd [2014] NZHC 726, [2015] NZAR 1351 at [8](b).
5 At [8](c).
(iii)Tahi alleges that Mr Taua and other signatories had the authority of the Iwi members to execute the JV Agreements on their behalves.
(iv)Tahi alleges that the Iwi signatories/counterparties to the JV Agreements entered into the agreements as agents and/or trustees of the Iwi members.
(v)Tahi pleads three causes of action against, inter alia, the Iwi members in relation to the purported cancellation.
(vi)Mrs Lee claims she is the assignee of a four per cent interest in the Iwi’s settlement proceeds and that assignment has been confirmed by the defendants in correspondence but denied in the pleadings.
(vii)Mrs Lee has not received the four per cent interest and pleads one cause of action against the Iwi members in relation to it.
(b)The Registers identify the Iwi members and so are relevant to determining issues in the proceeding, including: who they are; and the extent to which individuals have identified as members, and by what means they have confirmed their interest in the Iwi’s collective assets and intention to be bound by the Iwi’s decision-making processes.
(c)The applicants are entitled to discovery from existing defendants to identify additional defendants.
(d)The Register supports and is important to the applicants’ case in that they identify parties against whom relief is intended to be sought.
(e)Discovery of the Register is in the interests of justice.
[45] In support of the ground at [44](c) above, the plaintiffs submit that it is settled law that applicants are entitled to discovery from existing defendants to identify
additional defendants, citing Norwich Pharmacal Co v Customs & Excise Commissioners and G-Star Raw CV v Jeanswest Corp (NZ) Ltd.6
[46] Before going any further, I consider the different grounds justifying orders for discovery under rr 8.19 and 8.20 and the Court’s equitable jurisdiction as elucidated in Norwich Pharmacal and subsequent English cases.
Rule 8.20 — Particular discovery pre-commencement
[47] The purpose of r 8.20, which concerns “particular discovery before a proceeding has commenced”, is to allow a plaintiff to formulate its claim properly. It has its origins in the Norwich Pharmacal jurisdiction, but, as Wylie J noted in British Markitex Ltd v Johnston, the narrow confines of so-called equitable discovery have not been imported into r 8.20.7
[48] A plaintiff is required to establish three things to obtain an order under r 8.20.8 First, that the intending plaintiff is or may be entitled to claim relief against another person (that is, the intended defendant). Secondly, that it is impossible or impracticable for the plaintiff to formulate the claim without the documents sought. Thirdly, that there are grounds for belief that the documents may be or have been in the possession of a person (who may or may not be the defendant). The “is or may be entitled” element is significant and has been held to mean that there must be a sufficient “substratum of fact” to take the application beyond a mere fishing expedition.9
[49] The plaintiffs’ previous application for discovery of the Register heard by Associate Judge Smith was made under r 8.20. However, his Honour found that, if an intending plaintiff does not know the identity of the intended defendant, r 8.20 is not the appropriate path. He reached this conclusion because of the stipulation in r 8.20(3)(b) that the application be served on the intended defendant.
6 Norwich Pharmacal Co v Customs & Excise Commissioners [1974] AC 133 (HL); and G-Star Raw CV v Jeanswest Corp (NZ) Ltd [2013] NZHC 1251.
7 British Markitex Ltd v Johnston (1987) 2 PRNZ 535 (HC) at 540.
8 Welgas Holdings Ltd v Petroleum Corp of New Zealand Ltd (1991) 3 PRNZ 33 (HC) at 40.
9 At 43.
Norwich Pharmacal — The Court’s equitable jurisdiction
[50] An intending plaintiff who makes it clear that they are entitled to claim relief against another but cannot formulate the claim because they do not know the identity of an intended defendant may have recourse to the Court’s inherent jurisdiction to order discovery where justice requires, consistent with the principles in Norwich Pharmacal.10 The Norwich Pharmacal jurisdiction was recognised by Somers J in Exchange Commerce Corp Ltd v New Zealand News Ltd, who observed that:11
Not much difficulty can arise in the case of an intending plaintiff who makes it appear to the Court that he [or she] is entitled to claim relief against another but cannot formulate his claim without reference to a particular document or class of document.
[51] Subsequent decisions of the courts in the United Kingdom, including the decisions of the Supreme Court in Rugby Football Union v Consolidated Information Systems Ltd (formerly Viagogo Ltd) (in liq), have emphasised that the essential purpose of the equitable remedy is to do justice.12 This involves a careful weighing of all relevant factors, including:13
(i)the strength of the possible cause of action contemplated by the applicant for the order;
(ii)the strong public interest in allowing an applicant to vindicate his legal rights;
(iii)whether the making of the order will deter similar wrongdoing in the future;
(iv)whether the information could be obtained from another source;
(v)whether the respondent to the application knew or ought to have known that he was facilitating arguable wrongdoing, or was himself a joint tortfeasor;
(vi)whether the order might reveal the names of innocent persons as well as wrongdoers, and if so whether such innocent persons will suffer any harm as a result;
(vii)the degree of confidentiality of the information sought;
10 Norwich Pharmacal Co v Customs & Excise Commissioner [1974] AC 133 (HL).
11 Exchange Commerce Corp Ltd v New Zealand News Ltd [1987] 2 NZLR 160 (CA) at 164.
12 See Rugby Football Union v Consolidated Information Services Ltd (formerly Viagogo Ltd) (in liq) [2012] UKSC 55, [2012] 1 WLR 3333; and Coca Cola Co v British Telecommunications plc [1999] FSR 518 as cited in Pre-commencement Discovery Judgment, above n 2, at [152], n 35.
13 Rugby Football Union v Consolidated Information Services (in liq), above n 12, at [17].
(viii)the privacy rights under article 8 of the European Convention for the Protection of Human Rights and Fundamental Freedoms of the individuals whose identity is to be disclosed;
(ix)the rights and freedoms under the EU data protection regime of the individuals whose identity is to be disclosed; and
(x)the public interest in maintaining the confidentiality of journalistic sources, as recognised in section 10 of the Contempt of Court Act 1981 and article 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms.
[52] In his judgment on the plaintiffs’ previous discovery application, Associate Judge Smith concluded that where an intending defendant, who is or may be entitled to claim relief against another, seeks discovery of a document to enable them to formulate their claim, and they do not know the identity of the intended defendant, the application should be made and considered pursuant to the Court’s equitable jurisdiction.
[53] Relying on Norwich Pharmacal and the line of English cases that followed it, Associate Judge Smith concluded that the principal question was whether the justice of the case required the making of the order sought. He considered whether the plaintiffs had put forward enough evidence on the question of Mr Taua’s authority (to bind the members of the Iwi when he entered into the JV Agreements) to show that their claims were bona fide and more than speculative. He weighed the privacy interests of the individual Iwi members in the information in the Register against the interest of the plaintiffs in being able to pursue their legal rights. He concluded that an order for discovery of the Register was justified, but that the names and details of any individuals under the age of 18 should be redacted.
[54] The defendants have appealed that decision and the plaintiffs have cross- appealed, maintaining that r 8.20 should be interpreted such that service on the intended defendant is not mandatory if it is impossible (because, for example, their identity is unknown).
Rule 8.19 — Particular discovery post-commencement
[55] An application for particular discovery may be made under r 8.19 when proceedings have commenced. The test is different to that under Norwich Pharmacal
and r 8.20. The proceeding is on foot, so there is not the same emphasis on assessing the bona fide of the plaintiff’s claim. The plaintiffs must, however, satisfy the Court that an order is appropriate with regard to the four-stage approach described in Assa Abloy New Zealand Ltd v Allegion (New Zealand) Ltd, including that the documents sought are materially relevant to an issue before the Court.
Is the Register relevant to an issue before the Court?
The plaintiffs’ submissions
[56] The grounds the plaintiffs advance at [44](c) and [44](d) above are more appropriately advanced in an application for the Court to exercise its Norwich Pharmacal jurisdiction or under r 8.20. Indeed, these arguments were made in the application heard and determined by Associate Judge Smith. It would not be appropriate for me to rehear them now.
[57] The correct focus for an application made under r 8.19 is relevance to issues in the proceeding. The plaintiffs address relevance in the grounds at [44](a) and [44](b) above. Mr Upton, for the plaintiffs, refined these arguments at the hearing, submitting that the plaintiffs plead causes of action against the Iwi members and therefore a document that identifies who those Iwi members are must be relevant (this relevance is maintained independent of an intention to sue). Further, the presence of an individual’s name on the Register is evidence of their participation in the affairs of the Iwi and agreement to be represented by Mr Taua and the Iwi leadership in the context of the Treaty settlement process with the Crown. That evidence is relevant to the issue of Mr Taua’s (and the Tribal Authority’s) capacity to enter into the JV Agreements as agent and/or trustee of those individuals.
The defendants’ submissions
[58] The defendants submit that the Register is not relevant to any of the issues that arise from the pleadings. The identity of the Iwi members is not an issue in the proceeding. Nor is the participation by individual iwi members in the Iwi’s affairs. Rather, the issue is whether individual iwi members entered into the Agreements, and
whether the signatories to those Agreements had authority enter into the Agreements on behalf of the Iwi members.
[59] They say that the sole purpose of this application is to enable the plaintiffs to bring their claim against individual Iwi members. They contend that the proper procedure, which the plaintiffs undertook, was an application under r 8.20. That procedure involves an assessment of the strength of the plaintiffs’ claims against the intended defendants before discovery may be ordered.
What does the Register comprise?
[60]Here is what is already in evidence about the Register:
(a)The online membership registration form states that “The Te Kawerau Iwi Tribal Authority is developing a database of members of Te Kawerau a Maki Iwi. The purpose of the database is to: Enable Iwi members to participate in Te Kawerau a Maki Tribal Authority elections as a voter or candidate (must be over 18 years old); allow Iwi members to be involved in shaping the direction of the Iwi, enable Iwi members to access entitlements such as sponsorship, scholarship, assist Te Kawerau Iwi Tribal Authority to communicate with you; and build the Iwi Whakapapa database”.
(b)The information collected is an individual’s name, gender, date of birth, address, children, whakapapa (details of parents’ names and tupuna). Registrants are asked to indicate the tupuna that they are a descendant from: Tawhia ki te Rangi (also known as Te Kawerau ā Maki); and/or Mana; and/or Te Au o Te Whenua; and/or Kowhatu ki te Uru.
(c)A trustee of the Tribal Authority approves the eligibility of an individual to register as an iwi member.
(d)The form says that the information supplied by registrants is confidential within the terms of the Privacy Act 1993, and for the lawful
use of the Tribal Authority. A person may only access their own personal information.
(e)The Te Kawerau Iwi Settlement Trust Deed, signed on
21 February 2014 defines the “Te Kawerau a Maki Register” as the register of members of the Iwi that is to be maintained by the trustees and says that:
(i)The trustees are required to administer and maintain a register of members of the Iwi.
(ii)The contents of the Register will be the full names, dates of birth, postal addresses and email addresses of members of the Iwi. Each adult registered member will be allocated a beneficiary identification number.
(iii)Applications for registration are made to the trustees and must contain full name, date of birth, postal address, the whakapapa through which the applicant claims affiliation to the Iwi, and such evidence as the trustees require as to the applicant’s status.
(iv)A membership validation committee was to be established to make all decisions on applications. Membership was to comprise members of the Iwi with the expertise and knowledge of the Iwi’s whakapapa.
[61] It is also known that approximately 400 individuals over the age of 18 were registered as at 27 June 2007.14
[62] The information that is sought in this application is not this contextual evidence. It is the Register itself, which as the above analysis makes clear, is a collation of personal information about each Iwi member, namely their name, gender,
14 Tahi Enterprises Ltd v Taua [2018] NZHC 516 at [41].
date of birth, postal and/or email address, details of children, whakapapa (details of parents’ names and tupuna) and beneficiary number.
Is this information relevant to an issue before the Court?
[63] With respect, I do not accept that the “identity” of individual Iwi members is an issue before the Court. The fact that the plaintiffs plead that they are the counterparties to the agreements, that Mr Taua and other signatories acted as their agents/trustees, and that they have pleaded causes of action against them, does not make their “identity” a substantive issue for determination by the Court. Rather, the matter of their identification is a procedural issue which the plaintiffs seek to resolve to be able to join them as defendants. I will return to that point.
[64] Mr Taua and the other signatories’ (and the Tribal Authority’s) capacity to enter into the JV Agreements as agent and/or trustee of individual iwi members is an issue before the Court. But is the information in the Register relevant to determining that issue?
[65] The plaintiffs’ contended connection between registration and conferral of authority on Mr Taua and the Tribal Authority to enter into the JV Agreements as agent and/or trustee of those individuals is strained. It is clear from the above analysis that registration by an individual indicates that the individual identifies with the Iwi and has chosen to register, suggesting a desire to participate in Iwi affairs, be kept informed of Iwi developments, and a potential interest in benefitting from the Crown settlement. It is not evidence of their conferral of authority (express or implied) on Mr Taua or other Iwi leaders to enter into binding agreements on their behalves with Tahi/Mrs Lee, or even with the Crown. It is significant that there was a formal and structured process by which the Tribal Authority obtained a mandate from members of the Iwi to negotiate with the Crown.15
15 Registered Iwi members voted on whether to give the Tribal Authority the mandate to negotiate with the Crown. The Crown formally recognised that mandate on 29 October 2008. The Tribal Authority appointed specific negotiators, who had lines of accountability to the Tribal Authority. The Tribal Authority had formal lines of accountability to the Iwi. Once a draft settlement was negotiated, this too was formally ratified by vote of Iwi members.
[66] In any case, what is being sought here is the personal information contained in the Register: the names, addresses, gender, ages, children, whakapapa and identification number of each individual iwi member, not contextual evidence about what registration does or does not signify. The personal information contained in the Register will not, in and of itself, assist the Court one way or another on the issue of whether Mr Taua and the other signatories had authority to enter into the JV Agreements with Tahi and Mrs Lee on behalf of individual Iwi members, as agents or trustees. The information will identify the individuals and enable them to be joined to the proceeding. Their evidence may well be relevant to the issue of whether Mr Taua and the other Iwi signatories had “actual authority, being either express or implied by custom…” to enter into the JV Agreements. But I do not accept that the personal information contained in the Register on its own sheds any light on this issue.
[67] My conclusion is that the information sought in the Register is not relevant to a substantive issue before the Court. It is only relevant in the sense that it will enable the identification of the individual Iwi members, which will in turn enable the plaintiffs to bring them into the proceedings.
Weighing up everything, is an order appropriate?
[68] Having reached the conclusion that the information is relevant in the above respect only, the next step is for me to decide whether, weighing and balancing all factors, and in my discretion, it is in the interests of justice for an order to be made. Here I strike a problem. For the information sought is the personal information of around 400 individuals, collected by the Tribal Authority for a specific purpose and held as confidential personal information in terms of the Privacy Act 1993. The consequences of ordering discovery will be that confidentiality in that personal information will be lost and 400 individuals will be joined to the proceeding. Before making an order requiring the Tribal Authority to discover the Register, I would want to carefully weigh up, amongst other things, the privacy rights of the individuals in the information, against the public interest in the plaintiffs being to enforce their legal rights in court. The difficulty is that this takes me into the same territory to that which Associate Judge Smith covered in careful detail in the Pre-commencement Discovery Judgment and which has been argued again before the Court of Appeal. For me to
repeat this analysis would offend the principle of judicial economy. It also gives rise to a risk of inconsistent decisions on the same or very similar issues.
[69] Unfortunately, this is a consequence of the plaintiffs having made a second application for discovery of the same information under a different rule. While the grounds relied on in the two applications are superficially different, I have found that in substance they require me to consider the same or very similar questions. This conclusion follows from my rejection of the plaintiffs’ contended “relevance” to issues before the Court other than in the sense accepted at [67] above. For these reasons I am unable to conclude that it would be in the interests of justice to order discovery of the Register.
Attendance registers — para 1(b)(iv) and (vi)
[70] The plaintiffs also seek discovery of attendance registers from the hui on 7 and 14 September 2018 at which the Tribal Authority obtained the mandate of Iwi members to represent the people of Te Kawerau a Maki in negotiations with the Crown. The plaintiffs contend that these documents identify Iwi members who, by their participation in the mandate hui, have confirmed their interest in the Iwi’s collective assets and intention to be bound by the Iwi’s decision-making processes and for the same reasons that the Registers ought to be discovered, these documents ought to be discovered.
[71] I do not accept that the presence of an individual at the Iwi hui concerning the mandate to negotiate with the Crown is relevant to the issues in dispute in this proceeding, namely whether they gave, expressly or impliedly, Mr Taua and the other signatories to the JV Agreements with Tahi authority to enter into those agreements on their behalves.
[72] Again, the real reason the plaintiffs seek these records is to identify individual iwi members. The effect of that will be that these individuals are joined as defendants. Before ordering the Tribal Authority to disclose the records, I would need to carry out the weighing exercise discussed and be satisfied that in all the circumstances it was in the interests of justice for the order to be made. I find that I am again prevented from
doing so because of the earlier application of the plaintiffs for discovery of the Register.
Claimed confidentiality — para 1(c) and 1(d)
[73] In its application the plaintiff sought inspection of documents as listed in the schedule to the affidavit of Rewi Te Wharangi Newton dated 13 September 2019: NEW.01.015, NEW.01.024, NEW.01.026, NEW.01.045, NEW.01.080, NEW.01.093, and NEW.01.104, with all redactions removed. Inspection was sought on the basis that no legitimate basis for the redactions had been claimed. Further, the plaintiffs sought an order that the defendants provide for inspection the documents listed as REW.03.001 through to REW.03.0047 in Part 3 of the schedule. The plaintiffs contended that the defendants had made a blanket claim for confidentiality without stating the nature and extent of that confidentiality, and without proposing terms upon which inspection could be completed, in breach of r 8.15(2)(f) and r 8.16(1)(c) of the High Court Rules, and the documents had not been provided for inspection.
[74] At the hearing, Ms Langstone, for the defendants, explained that the failure to include inspection terms in the affidavit was an error that had now been corrected in a further affidavit from Ritesh Prasad dated 17 July 2020 in opposition to the plaintiff’s application for discovery. In this affidavit, and the notice of opposition, the defendants stated that the documents sought at para 1(d), and the redactions at para 1(c), were confidential and could be inspected by the plaintiffs on conditions. The conditions proposed were that the documents be provided to the plaintiffs’ solicitors provided that no copies of the documents are to leave the solicitor’s offices; no electronic copies are to be sent to their clients or third parties; the documents were not to be read in open Court; and, at the end of the proceeding, any copies of the documents are to be destroyed, deleted or returned.
[75] Also at the hearing, Mr Upton submitted that the proposed restrictions are unduly onerous and unnecessary given the restrictions on collateral use already in place. He submitted that that restriction ought to be sufficient to protect the confidentiality claimed by the defendant. Ms Langstone, however, submitted that the proposed restrictions were designed to address a real concern. She said that Tahi and
Mrs Lee have demonstrated their willingness to breach confidentiality, including going to the media and accepting a document from a third party that was clearly received in breach of confidence (namely, the memorandum of understanding discussed below).
[76] The defendants have belatedly proposed limits on the inspection of the confidential documents in question as required by the High Court Rules. They still have not stated the nature and extent of the confidentiality as required by r 8.16(1)(c). They should do so. If the plaintiffs challenge that claimed confidentiality, the appropriate course is for them to apply to the Court under r 8.25 for an order setting aside or modifying the claim. Under r 8.25(3), a Judge has a discretion to set aside or modify the claim for confidentiality or dismiss the application or make any other order. Unfortunately, I am unable to deal with this issue on the evidence before me in this application. The defendants have not explained the nature of the documents or provided any evidence to support the confidentiality claimed and why the restrictions on inspection are considered necessary. It is well established that on a challenge to confidentiality claimed in discovery, the Court must first decide whether the documents are confidential. The party claiming confidentiality bears an initial onus to make out the requirements for its confidentiality claims.16 A proper evidential foundation should be laid for a claim of confidentiality in respect of each document alleged to be confidential.17 Once that is done, the Court balances the interests of justice in ensuring that a party is able to prepare and present its case with the interests of another party in safeguarding its confidential information. At that balancing stage, to the extent there is an onus, it is on the applicant seeking to set aside the confidentiality claim.
[77] I hope that counsel will be able to resolve this issue pragmatically without recourse to the Court. The defendants are required to file an affidavit of documents which complies with rr 8.15 and 8.16 and states the nature of the confidentiality claimed in respect of each document or group of documents as appropriate. If the plaintiffs are not satisfied with that, and/or with the restrictions on inspection imposed,
16 Port Nelson Ltd v Commerce Commission [1994] 7 PRNZ 344 (CA) at 348.
17 At 348; and Detection Services Ltd v Pickering [2018] NZHC 1617 at [6].
they will need to make an application to the Court under r 8.25(1). The Court will require evidence from both parties to enable it to undertake the balancing exercise.
Memorandum of understanding — para 1(e)
[78] The plaintiffs seek discovery of all documents related to a document titled “Memorandum of Understanding” (“MOU”), dated 12 July 2018, between the Settlement Trust and Cromcorp New Zealand Ltd. That document records the parties’ intention to collaborate to develop the Iwi’s settlement asset, being the land at Riverhead Forest. The plaintiffs say documents relating to this MOU are relevant as the JV Agreements between the Iwi and Tahi contemplated commercial development of the Iwi’s settlement assets. The plaintiffs therefore say that the MOU is relevant to the damages inquiry sought by Tahi in its first cause of action, which relates to the Iwi’s purported cancellation of the JV Agreements, as it sets out the scale of a potential housing development on the Riverhead site.
[79] The defendants contend that the documents relating to the MOU are not relevant as the deal did not proceed. They also say that the document is confidential and question how the plaintiffs (who discovered it) came to possess it.
[80] With respect, I agree with the defendants. The MOU would only be relevant to the question of damages if there was some final agreement to develop the Riverhead Forest land. There was no such final agreement. The deal did not proceed. Indeed, in their second amended statement of claim, the plaintiffs themselves state that “[t]his document related to a proposed comprehensive commercial development” (emphasis added).
Result
[81]The plaintiffs’ application is dismissed.
[82] The defendants are entitled to costs on a 2B basis. The parties are to file an agreed memorandum within two weeks. Failing agreement, the defendants are to file a memorandum within two weeks and the plaintiffs one week later.
Associate Judge Gardiner
Solicitors:
Shieff Angland, Auckland LeeSalmonLong, Auckland
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