Te Ohu Kai Moana Trustee Ltd v Attorney-General
[2016] NZHC 1798
•4 August 2016
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2016-485-180 [2016] NZHC 1798
BETWEEN TE OHU KAI MOANA TRUSTEE
LIMITED Plaintiff
AND
HER MAJESTYʼS ATTORNEY- GENERAL
Defendant
Hearing: 15 July 2016 Counsel:
J E Hodder QC, J P Ferguson and M C Tukapua for Plaintiff
V Hardy and C R W Linkhorn for DefendantJudgment:
4 August 2016
JUDGMENT OF SIMON FRANCE J
Introduction
[1] The Attorney-General seeks an interim stay of these proceedings on the basis that their continuation at this time would constitute improper interference with the proceedings of Parliament and would infringe its privileges.
[2] The background to the plaintiff’s proceedings is the decision by the Crown to establish an ocean sanctuary around the Kermadec Islands. This proposal will have an impact on the capacity of quota holders to fish the area. Te Ohu Kai Moana Trustee Ltd (TOKM) or (Te Ohu) holds quota shares for these waters.
[3] The proposal for a sanctuary is now in statutory form. The Kermadec Ocean Sanctuary Bill had its first reading on 15 March 2016. The Bill was before a Select Committee at the time of this hearing, and has since been reported back. The Attorney-General submits that the declarations sought by TOKM are in effect a
request for the Court to comment on the legislation. It is submitted this breaches the
TE OHU KAI MOANA TRUSTEE LTD v HER MAJESTYʼS ATTORNEY-GENERAL [2016] NZHC 1798 [4 August 2016]
principles of comity between the two branches of government, and would interfere with the privileges of Parliament.
Factual background
[4] The waters around the Kermadec Islands form part of Fisheries Management Area 10 within the New Zealand fisheries quota management system. One hundred million quota shares have been allocated for each of the fish stocks within Area 10, although as I understand it the area around the Kermadec Islands is not yet commercially fished pursuant to quota. Only minimal Total Allowable Commercial Catch levels have thus far been set.
[5] TOKM is a major shareholder in these Area 10 fish stocks. Depending on whether the particular fish stock was brought within the Area before or after the fisheries settlement, TOKM will own 10 per cent or 20 per cent of the shares. In total it holds 840 million shares.
[6] The creation of an ocean reserve will obviously potentially impact on the ability to use the quota. It is this potential that lies behind the litigation.
The pleadings
[7] The statement of claim pleads in sequence the Quota Management System, the Fisheries Settlement, the Treaty of Waitangi (Fisheries Claims) Settlement Act
1992, the Māori Fisheries Act 2004, the Fishery Management Area 10, the existing restrictions in relation to Area 10, the Kermadec Ocean Sanctuary proposal, the Kermadec Ocean Sanctuary Bill and “apprehension of future derogations from settlement”. The first cause of action pleads that the sanctuary, “on the terms proposed by the Crown” will be a breach of the Deed of Settlement, and will remove benefits provided to Māori by the settlement. The particulars trace the route by which Māori obtained benefits, describe the sanctuary proposal as the unilateral removal of such rights, and say it is being done without the consent of TOKM and iwi, and without fair compensation.
[8] Declarations are sought. For the purposes of this application, declarations
(b), (c) and (d) are reproduced:
(b) A declaration that Crown proposals for any material derogation from the Plaintiff’s rights (as outlined in Declaration (a) above) which proposals have not been developed in good faith through fully informed consultation with, and the consent of, the Plaintiff and iwi, and consistently with the purpose, ongoing importance and just and honourable quality of the 1992 Deed of Settlement, will be inconsistent with the ongoing requirements of that Deed;
(c) A declaration that the establishment of the Kermadec Ocean
Sanctuary, on the terms proposed by the Crown, breaches the 1992
Deed of Settlement by abrogating the benefits provided to Te Ohu on behalf of Māori under the Māori Fisheries Act 1989, the 1992 Deed of Settlement and the 1992 Settlement Act.
(d) A declaration that the actions of the Crown involve a unilateral removal of the “benefits provided to Māori by the Crown” referred to in section 9(a)(i) of the 1992 Settlement Act, and an alteration to the settlement enshrined by that Act.
[9] The second cause of action is a claim of breach of duty of good faith. It is said the Crown owes a relational duty of good faith to TOKM and iwi, and that the Kermadec Ocean Sanctuary proposal breaches that because it is being established without fully informed consultation, without the consent of TOKM and iwi, and without fair compensation.
[10] The second declaration sought in this regard is:
(b) A declaration that that the establishment of the Kermadec Ocean Sanctuary, on the terms proposed by the Crown, breaches the Crown’s duty of good faith.
The comity principle
[11] There is little dispute between the parties as to what the comity principle involves. The issue is whether the proceeding, or any potential relief, will breach it.
[12] The starting point is article 9 of the Bill of Rights 1688 which provides that proceedings in Parliament shall not be impeached in a court. The Attorney-General
cites the following passage from Prebble v Television New Zealand as an example of the import of article 9:1
In addition to art 9 itself, there is a long line of authority which supports a wider principle, of which art 9 is merely one manifestation, viz, that the Courts and Parliament are both astute to recognise their respective constitutional roles. So far as the Courts are concerned they will not allow any challenge to be made to what is said or done within the walls of Parliament in performance of its legislative functions and protection of its established privileges: …
[13] The Parliamentary Privileges Act 2014 was enacted to clarify and confirm the extent of Parliamentary Privilege. Section 4, as relevant to this proceeding, provides:
4 Interpretation of this Act
(1) This Act must be interpreted in a way that–
(a) promotes its main and subsidiary purposes; and
(b) promotes the principle of comity that requires the separate and independent legislative and judicial branches of government each to recognise, with the mutual respect and restraint that is essential to their important constitutional relationship, the other’s proper sphere of influence and privileges; and
This is an express recognition of the comity principle on which the Attorney-General relies for his application.
[14] On several occasions the Court of Appeal has confirmed that the comity principle means a court cannot seek to prohibit the introduction of legislation – Te Runanga O Wharekauri Rekohu Inc v Attorney-General2 and Westco Lagan v Attorney-General3 are two examples. The Attorney-General also relies on
New Zealand Māori Council v Attorney-General.4
[15] The cases do not require analysis as the principles for which they generally stand are not in dispute. The issue as I see it is whether declarations that do not
challenge the ability of the legislature to consider and pass legislation, but which
1 Prebble v Television New Zealand [1994] 3 NZLR 1 at 7 (PC) citations omitted.
2 Te Runanga O Wharekauri Rekohu Inc v Attorney-General [1993] 2 NZLR 301 (CA).
3 Westco Lagan v Attorney-General [2001] 1 NZLR 40 (HC).
4 New Zealand Māori Council v Attorney-General [2007] NZCA 269, [2008] 1 NZLR 318 (CA).
invite direct or implied comment on the content of the legislation and its impact on certain people, at a time when the legislation is still before the House, also breach the principle.
Discussion
[16] On its face the statement of claim appears to invite the Court to pass comment on the merits of legislation while it is being considered by the House. The comment would involve the impact of the Bill, if passed in its current form, on TOKM’s property rights. It also directly seeks to impeach the processes leading up to introduction of the Bill – the consultation and good faith arguments.
[17] The Attorney-General does not claim at this point that these matters are not justiciable. Rather, it is said the Court should not entertain argument on them while the legislation is before the House. As was said in Te Runanga O Wharekauri Rekohu Inc,5 the proper time for challenging legislation is after its enactment. Because there is obvious strength in the Attorney-General’s application, I turn to the matters relied on by TOKM to resist a temporary stay.
[18] It first emphasises that there is no claim that the Court can or should interfere with the passage of the legislation. The legislation is a fact – it is before the House, it can be considered by the House, and the Court cannot interfere with it. However, there are matters within the claim such as TOKM’s rights under the fisheries settlement which are capable of determination and declaration, and which will proceed regardless of whether the Bill is enacted. The proceeding is therefore characterised as seeking a declaration as to existing rights rather than a pronouncement on the effect of the Bill.
[19] TOKM relies on a decision of this Court in Port Nicholson Block Settlement Trust v Attorney-General.6 Mr Hodder QC advised that the revised statement of claim filed for the hearing was designed to reflect that which was found permissible
in the Port Nicholson case.
5 Above, n 2 at 308.
6 Port Nicholson Block Settlement Trust v Attorney-General [2012] NZHC 3186.
[20] Port Nicholson involved a claim by Taranaki Whānui that a settlement reached between the Crown and Ngāti Toa was in breach of a prior settlement reached with Taranaki Whānui. The Ngāti Toa settlement, as is commonplace, had attached to it draft legislation which it was contemplated would be introduced into the House to give effect to the settlement. The Attorney-General contended, amongst other things, that the litigation sought to impeach the process preparatory to the enactment of legislation.
[21] Williams J accepted that if the proceeding did that, it would constitute a breach of the principle of comity. A passage from the New Zealand Māori Council decision relied on by the Attorney-General in this proceeding was cited:7
… the courts will not grant relief which interferes or impacts on actions of the executive preparatory to the introduction of a Bill to Parliament, because to do so would intrude into the domain of Parliament.
[22] However, consequent upon amendments to the declarations sought, his Honour considered the proceeding did not cross the comity line. The declarations sought required the Court’s comment on the consistency or otherwise between the two settlements, and required the Court to construe the meaning of the Taranaki Whānui settlement. Neither process called into question what might happen in the House of Representatives.
[23] One can then see in the present proceeding a similar structure. The first declarations now ask the Court to interpret the Settlement Deed and subsequent Acts, and to declare what benefits accrued to TOKM under them. Mr Hodder contends these are unobjectionable, while accepting that greater issue arises with some of the further declarations sought. In relation to these, however, Mr Hodder submits the time to avert to the comity principle is when one reaches the relief stage. The Court can at that point decide whether a declaration would be appropriate or not.
[24] I am comfortable with the concept emerging from Port Nicholson that there may be a spectrum and it is a matter of assessing on which side of the line a particular proceeding falls. The mere presence of legislation in the House cannot
operate as a ban on consideration of all related issues. An example of court proceedings continuing on the same issues as were being dealt with by legislation in the House is Thompson v Treaty of Waitangi Fisheries Commission.8
[25] The Kermadec Ocean Sanctuary proposal has plainly brought into focus issues about the nature of property rights attaching to quota shares, and the impact of the total allowable commercial catch process on that. There are also issues for the present plaintiff as to whether the source of its property interest, namely the Treaty of Waitangi and the fisheries settlement, carries with it particular Crown obligations that might not be present for other quota holders. The revised pleading also notes an apprehension that there may be further proposals to remove other areas from the scope of fishing activities, and therefore a need for clarification of these general issues regardless of what happens with the Kermadec Ocean Sanctuary.
[26] It follows that I accept the proceeding cannot be characterised solely as being directed at the particular piece of legislation. However, there is now a particular piece of legislation working its way through the procedures of the House. The comity principle is long-standing and of great importance, and care must be taken to respect it. A further relevant factor is that what is sought here is only a temporary lull to allow Parliament to complete its processes. In that sense it could be seen to be striking the right balance between the branches.
[27] I have reached the view that the litigation should be the subject of a temporary stay. There are undoubtedly aspects of it that could continue parallel with the legislative process, but no severance proposal was put to me, and the reality is that it would require repleading. For example, it seems to me the issue of whether the source of TOKM’s shares, namely the Treaty of Waitangi and the fisheries settlement, carries with it particular obligations before the Crown institutes steps to (arguably) lessen the value of the settlement is a matter capable of exploration.
[28] However, when one focuses on the particular declarations sought here, it is apparent they cross the line into the impermissible, at least whilst the legislation is
before the House. For example, although the good faith pleading refers to duties to consult and the like, the declaration sought is that:
the establishment of the Kermadec Ocean Sanctuary, on the terms proposed
by the Crown, breaches the Crown’s duty of good faith.
[29] The Sanctuary will only be established by the legislation. The “terms proposed by the Crown” can only be a reference to the contents of the legislation. The declaration would therefore be a statement by the Court that the current legislation before the House, if passed as currently drafted, will breach the Crown’s duty of good faith. That appears to me to be a direct comment on the propriety of the legislation and would breach the comity principle.
[30] The terms of this proposed declaration also illustrate why I do not accept it is a matter that can just be considered at the relief stage. One does not get to that point without the filing of evidence, the hearing of submissions and the writing of a judgment which assesses whether the basis for a declaration is made out. A breach of the comity principle is not avoided by withholding a formal declaration having already written a judgment, the reasons of which potentially impeach the proposed legislation.
[31] The content of several of the other declarations raises similar problems. Declarations (c) and (d) under the first cause of action likewise involve direct comment on the legislation. If the hearing proceeds at the present time, then evidence will need to be prepared and filed that engages directly with the substance of the legislation and the reasoning underlying it. The Court would be placed in the
heart of a political debate being carried on in the House.9
9 Boscawen v Attorney-General [2009] NZCA 12 at [36]. The Attorney-General also relied on s 11 of the Parliamentary Privileges Act 2014. It prohibits evidence or submissions in court that question the good faith, amongst other things, of anything that forms part of the proceedings of Parliament. The ambit of that provision would need considerable analysis that is not required in order to resolve the application; I simply note the submission for the record.
Conclusion
[32] For the reasons given I am satisfied that continuation of this proceeding as pleaded while the Kermadec Ocean Sanctuary Bill is before the House would constitute a breach of the comity principle between the two branches.
[33] Accordingly, the Attorney-General’s application for a temporary stay is
granted. No further steps are to be taken until the legislative process is complete.
[34] Costs memoranda may be filed if required.
Simon France J
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