The Gama Foundation v Chief Executive of the Ministry of Social Development

[2021] NZHC 2321

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2021-485-334

[2021] NZHC 2321

UNDER

the Judicial Review Procedure Act 2016

IN THE MATTER

of an application for judicial review of decisions of the Ministry of Social Development

BETWEEN

THE GAMA FOUNDATION

Applicant

AND

THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT

First Respondent

THE ATTORNEY-GENERAL OF NEW ZEALAND

Second Respondent

Hearing:	6 September 2021
Appearances:	T Mijatov, M C McCarthy for the Applicant N Wills, S P R Conway for the Respondents
Judgment:	6 September 2021

JUDGMENT OF COOKE J

(Particulars)

[1]                  By notice dated 2 August 2021 the respondents require the applicant to provide further and better particulars of its claim before they are required to file a statement of defence. The application is opposed by the applicant.

[2]                  The applicant is a charitable trust operating as a philanthropic organisation concerned with public issues, including wealth inequality and the responsible spending of public money. In these judicial review proceedings the applicant

THE GAMA FOUNDATION v THE CHIEF EXECUTIVE OF THE MINISTRY OF SOCIAL DEVELOPMENT [2021] NZHC 2321 [6 September 2021]

challenges what it alleges to be an unlawful failure by the respondents to prosecute those who improperly took and/or retained the Government’s Covid-19 wage subsidy payments. A key allegation is in paragraph [38] of the amended statement of claim dated 9 August 2021 which pleads:

38.        MSD has failed to properly exercise its discretion as to prosecution by failing to prosecute any recipients of the wage subsidy because:

(a)it unlawfully fettered its discretion to prosecute by adopting a policy or practice that it would not prosecute any recipients of the wage subsidy; and/or

(b)it failed to consider whether certain cases met the evidential and public interest tests for prosecution as set out in the Guidelines and Policy; and/or

(c)it unreasonably decided that certain cases did not meet either the evidential and/or public interest tests as set out in the Guidelines and Policy.

[3]                  The reference to the Guidelines is to the Solicitor-General’s Prosecution Guidelines, and the reference to the policy is to MSD’s own Prosecution Policy. These are guidelines and policies of general application.

[4]                  The respondents say they are not able to plead to these allegations without further particulars being provided. Whilst the notice requiring further particulars goes further, the key point arises in relation to paragraph [38] referred to above. In particular Ms Wills argued that the respondents needed to know what the “certain cases” were set out in [38(b) and (c)] before the respondents could be reasonably expected to plead to the allegations.

[5]                  In response Mr Mijatov contended that the claim was adequately particularised as the applicant’s case did not relate to any particular cases within the knowledge of the applicant but rather MSD’s failure to prosecute any case, and that any allegations about individual cases could only be particularised after discovery.

Assessment

[6]                  It is important to emphasise that judicial review involves a simple, untechnical, and prompt procedure.1 The powers of the Court under ss 13 and 14 of the Judicial Review Procedure Act 2016 are central to ensuring this. Under s 8(2) of that Act, Part 5 of the High Court Rules 2016 automatically applies. Other procedural directions can then be made by the Court under s 14, and this can include adopting other High Court Rules in order to secure the efficient disposition of the proceedings.2 Rule 5.21 is one of those that automatically applies to a judicial review proceeding, and accordingly the respondents have a right to call for further and better particulars of the claim.

[7]                  I accept that paragraphs [38 (b) and (c)] of the amended statement of claim make allegations about particular cases, and for that reason the respondents are entitled to know which cases are being relied upon to respond to these allegations.

[8]                  But as Ms Wills accepted in her submissions a challenge can be advanced without reference to particular decisions. Moreover the applicant does not have information about individual cases. In my view there is no point in directing the applicant to provide particulars that it simply cannot provide because it does not have the knowledge to give them. It is entitled to advance this challenge on the basis that the absence of any prosecutions and other materials give rise to an inference that there is a deficiency of the kind that it has pleaded. In the absence of a formal policy document the challenge will likely involve an assessment of the actions taken by the respondents on particular files,  and  why  they  did  not  lead  to  prosecution.  As Mr Mijatov emphasised the claim refers to an alleged practice as well as an alleged policy.

[9]                  Once it is accepted that such a challenge may be advanced, this matter simply becomes one of efficient case management.

1      Minister of Energy v Petrocorp Exploration Ltd [1989] 1 NZLR 348 (CA) at 353.

2      Such as those relating to strike out - see, for example, Wilson v Department of Corrections [2018] NZHC 2977.

[10]              In private law claims it is not unusual for the Court to determine that further and better particulars only need to be provided by a plaintiff after discovery has been given by a defendant because the relevant matters are principally within the knowledge of the defendant.3 Ms Wills sought to distinguish the cases which have adopted this approach on the basis that the alleged deficiency here goes to the essence of the claim being advanced by the applicant. I do not accept that this suggested distinction means that this is not the appropriate approach. Once it is accepted that the applicant’s claim can properly be advanced, and that the applicant is not able to give particulars about individual cases until information is discovered by the respondent, then the appropriate course is to direct that discovery take place, with better particularised pleadings to follow. Indeed when the proceedings involve a challenge to the exercise of public powers it may be thought there is greater justification for the relevant information to be disclosed by the public body than would be the case with a private body facing civil proceedings.

[11]              To the extent that Mr Mijatov’s argument included the proposition that the applicant should not be required to provide particulars as its claim is based on a more general alleged policy I do not accept it. Paragraphs [38 (b) and (c)] refer expressly to “certain cases” and the respondents are entitled to know what those cases are. Moreover, as I have said, it seems to me likely that this challenge will involve consideration of decisions made, or not made, on individual files. Tailored discovery will be required of material that is relevant, and proportionate to what is required for a judicial review challenge of this kind.

[12]              There is a further dimension arising from the possibility that parties whose position was assessed for prosecution by the respondents may have a right to be heard, or be joined as a respondent to the proceedings.4 This will need to be addressed by the parties, and then at a further judicial conference.

3      Carter Holt Harvey Ltd v Paper Reclaim Ltd HC Auckland CIV-2004-404-5739 at [36]-[38]; Ross v Blakes Motors Ltd [1951] 2 ALL ER 689 (CA).

4      Minister of Education v De Luxe Motor Services (1972) Ltd [1990] 1 NZLR 27. This is an issue that will need to be addressed once it becomes clearer whether particular files will be the focus of this judicial review proceeding.

[13]              Given the above, the real issue is the directions for the efficient case management of the proceeding. Having discussed those with counsel I give the following directions:

(a)the respondents’ statement of defence to the amended statement of claim should be filed and served within 5 working days;

(b)the scope of discovery is to be discussed between the parties over a period of a further 10 working days. The parties are encouraged to agree on the timing and scope of discovery. If agreement is not reached the parties have leave to file memoranda that can be referred to me for a decision on the papers if the parties agree to that course, or alternatively either of them may file a further interlocutory application in the normal way;

(c)following the provision of discovery the applicant should file and serve a further amended statement of claim providing particulars of any specific prosecution decisions that are challenged;

(d)there should then be a further case management conference after that stage at which the question of serving additional parties will be amongst the issues to be considered. The parties should ask the Registry to arrange that conference should that point be reached.

[14]              The parties did not address costs. My preliminary view is that the applicant is entitled to costs on a 2B basis for the respondents’ unsuccessful application, but very brief memoranda may be filed.

Cooke J