NEWS Feb 2, 2024 Issue 1
Inside ■ TLA
New Year message from Tony Herring P08
■ POLITICS
Generation stop-gap P12-13
How the CCCFA crashed the property
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Contents 10 ALLEGED THEFT MP CRIMINAL LAW
Why no presumption of innocence for former Green MP Golriz Ghahraman?
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Feb 2, 2024
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Issue 1
PROPERTY
How the CCCFA crashed the property market; minister promises relief by mid-year The number one cause of declining house prices is the inability to get finance
Sally Lindsay Major changes are coming to the Credit Contracts and Consumer Finance Act (CCCFA), the piece of legislation put in place by the former Labour government that, in the view of most industry experts, has been largely responsible for wrecking the housing market. As a priority, the National-led coalition government’s Commerce and Consumer Affairs Minister, Andrew Bayly, says he will remove the prescriptive affordability requirements for lowerrisk lending and undertake a substantive review of the CCCFA, including its penalty and disclosure regime. Bayly says he expects to have identified the main areas requiring regulatory change by early April and have fresh legislation in place by mid-year. Key to reforming the CCCFA will be scrapping the penalty regime which makes the directors and senior managers of banks and other lenders personally liable if they are found to have failed to exercise due diligence to ensure their businesses have complied with their duties and obligations under the Act.
There were a lot of unintended consequences in the form of legislation looking for a problem that didn’t exist
The penalty for breach is a fine of up to $200,000 and/or any court-ordered damages. The banks have been clear that until this personal liability is removed, their tight lending policies will not change. Of all the restrictions the previous government put in place to try to slow down the property market, the CCCFA changes in late 2021 have had the single biggest impact on house sales and prices because they made it extremely difficult to get a mortgage.
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Continued from page 03 Six months after the change, loan approvals had slumped by 40% (see accompanying graphs). In December 2021, 81,900 mortgages were granted but by May 2022 this had fallen to only 45,440, according to research done by Opes Partners, a Christchurch-based property investment specialist. Under the CCCFA, processing times for lending applications increased by 50% across all loan types. Bayly says he understands an estimated 6%-7% of mortgage applicants at the major banks, from customers who would have previously qualified for borrowing, had to be turned down because of the government’s prescriptive and intrusive lending rules. Bayly says vulnerable consumers still need protection but this must be done without unnecessarily limiting other borrowers’ access to credit. In his view, it is the detailed regulations and the punitive liability regime that need reforming. While Labour’s numerous anti-property investor/landlord policies had some effect, as did the Reserve Bank’s tightening of loan-to-value ratios after being loosened during the pandemic, the straw that broke the housing market’s back was the CCCFA changes, according to Andrew Nicol, Opes Partners managing partner, and the company’s economist, Ed McKnight. Labour’s other property-related changes included the ringfencing of losses in 2019, extending the bright-line test from two years to five in 2018 and from five to 10 years in March 2021, revised tenancy laws in 2020 and 2021, and gradually scrapping interest deductibility on mortgage repayments for investment properties in 2021. Nicol and McKnight have ploughed through 113 pages of coalition documents and identified the five most important policy changes affecting property investors.
I don’t think it’s going to be a flick of a switch – it will take several years
Andrew Bayly
put people’s spending into 17 buckets. “If you weren’t living as if you had a mortgage already, the banks decided you probably couldn’t afford one,” McKnight says. “The prescriptive affordability requirements became allencompassing, stopping banks from lending money to people who were spending what was considered too much on coffees, Uber Eats, Netflix, Christmas presents and other spending seen as normal by most people. “Before that, banks recognised people would spend what they had in their bank account but once they got a mortgage, they would rein in their spending to be able to afford the repayments. That went out the window. “The number one cause of declining house prices is the inability to get finance. It led to fewer people taking out loans, fewer houses being sold and prices dropping.”
Caution after penalties McKnight says another aspect of the onerous changes was banks becoming far too conservative because of the $200,000 penalty imposed on directors and senior management for breaching the CCCFA. ”That led to entirely unjustified and intrusive detailed vetting of customers’ spending. Many just put their mortgage applications on hold while they dropped their subscriptions, tidied up their ‘buy now, pay later’ deals and reduced their overall spending for three months to make a better bid, instead of getting
Spending scanned When the CCCFA changes were signalled, some major banks acquired special software which could scan bank statements and 04
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Feb 2, 2024 Issue 1
Continued from page 04 a ‘decline’ from their bank. House sales fell and prices dropped to a market slump of about 15% across the board until they turned and started picking up last year.” McKnight says there needs to be a simple test under the government’s revised CCCFA to approve loans for people who have a good income and can clearly afford a mortgage. The penalties for banks’ directors and senior management should be reduced or wiped altogether and the regulations tightened against loan sharks and truck and payday lenders. This was the original intention of the CCCFA but banks also became caught in its net. Although the banks have softened their lending criteria since Labour made two tweaks to the CCCFA, McKnight doubts that after spending millions on software to assess customers’ spending habits, bans will revert easily and completely to the looser borrowing restrictions in place prior to the 2021 changes to the legislation. “They will probably start to slowly relax the lending rules as interest rates come down and they want to grow their market share. I don’t think it’s going to be a flick of a switch – it will take several years,” McKnight says.
Agility the key Mortgage adviser and Advice HQ founder and director David Green, who worked for banks and sat on credit committees before setting up his own business, disagrees with McKnight on this point. “Banks have to be agile enough to change their settings to different rules and regulations and market conditions,” he says. “During covid, banks changed their settings on a weekly basis. They can change a credit policy overnight and making more credit available is good for their business.” Green says there is no doubt the CCCFA changes have created a huge credit crunch. “There were a lot of unintended consequences in the form of legislation looking for a problem that
Banks can change a credit policy overnight and making more credit available is good for their business
Andrew Nicol
didn’t exist. There were never problems with mortgage arrears or delinquencies at banks. And increasing the penalties for directors and senior managers over some perceived offences they could commit has just made them too nervous to step outside the legislation, making it difficult for borrowers, mortgage advisers and the housing market in general.” Squirrel Mortgages chief executive David Cunningham says he’s happy with the planned changes, saying the CCCFA was a sledgehammer designed to crack a nut. “It was originally about loan sharks, who are a fraction of the market. The sledgehammer missed the nut and hit the proverbial tree – the banks. “What happened was crazy. Banks, which are the bulk of the country’s financial system, don’t [do] and have never done risky lending. They did a perfectly good job before the changes, as evidenced by their incredibly low loss rates.” Cunningham says Bayly’s changes indicate banks will probably go back to making their own assessments on borrowers and not be overly prescriptive by capturing every last expense, which is sound policy. “It also reflects the reality that a historical look at expenses isn’t the same as a forward-looking view of expenses.” The perfect illustration of that, Cunningham says, is that during the past two years, borrowers have seen their interest rates treble in many cases, and the default rates and delinquencies are as low as ever. And that’s not because of a prescriptive CCCFA. Rather, it speaks to wise lending by banks whose interest is in looking after customers, both in terms of
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The bright-line test has caused people to hold on to their properties longer than they want to and stopped the market from functioning properly
lending the money when it’s appropriate and not lending the money when it’s inappropriate.
Cashflow effects Along with eased lending restrictions, investors will also pay less tax under the government’s plan to restore mortgage interest deductibility. For the current tax year, 60% is deductible, 80% will be deductible from 1 April and 100% from 1 April 2025. This is part of the coalition agreement, although Act wanted it to be brought in immediately. Restoring interest deductibility (which other types of businesses enjoy) will substantially affect property investors’ cashflows. As an example, under Labour’s policy of phasing out tax deductibility, a property bought for $600,000 in 2021 is rented for $600 a week but the investor is topping up the mortgage by $30,000 a year for the next 15 years which is brutal, says Nicol. Over 15 years, that would mean a negative cashflow of $131,000. “Under the coalition government’s restored mortgage interest deductibility, the first five years are still negatively geared because of high interest rates, but the next 10 are in positive territory and the investor saves $72,400 in tax. It makes property investing more profitable, leading to increased demand and prices being pushed up,” he says.
Bright-line changes Other government changes will push up housing supply. On July 1, the bright-line period will be reduced from 10 years to two years, which McKnight believes will prompt a wave of selling, with tens of thousands of houses likely to flood the market. Before the original two-year bright-line test was introduced in 2015 by John Key’s National government, just under 130,000 houses a year were being listed on the market. Between then and the extension of the bright-line to five years in 2018, 13,000 fewer 06
Ed McKnight properties were put up for sale and between 2018 and 2021, when the bright-line period was extended to 10 years, 8,000 fewer properties came onto the market – a total of 40,000 fewer homes being sold every year, about a 30% drop (see graph). During that time, house prices have risen and investors, who don’t believe their rental is a good long-term investment, have the gains locked up in their properties while paying higher interest rates and tax. “Looking at the figures over the past few years, most decided not to sell if they, for example, had a three-year wait until they were outside the bright-line,” McKnight says. If they sold, it would have meant paying bright-line tax at their marginal rate, compared to no tax at all under National, with the added bonus of interest deductibility, so most have decided to ride it out. “It wasn’t a difficult decision,” McKnight says. That is about to change, however. Opes’ research shows when the bright-line changes in July, about 250,000 properties purchased over the past few years will be outside the test. Not all will be investor-owned properties; perhaps 75,000-100,000 will fall into this category. And not all of these will come on to the market but Opes is picking between 1% and 10% will be put up for sale as investors struggle with cashflow.
Less risk for landlords Labour’s changed tenancy policies, making it difficult for
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Feb 2, 2024 Issue 1
7,750 fewer properties listed p.a.
Continued from page 06 landlords to evict rogue tenants, will also be kicked to touch. Under the National/Act coalition agreement, landlords will again be allowed to issue no-cause 90-day termination notices to end a tenancy. This was removed by Labour six years ago, although research shows it was used by only about 2% of landlords. Pet bonds will also be introduced, allowing tenants to keep a small pet if the landlord agrees. They will have to pay a bond. As landlords could not previously charge extra rent to cover any damage caused by a pet, there was no incentive to take on a tenant with a pet. Opes says these and other minor changes to tenancy laws will mean investors perceive there is less risk in rental property investing. At the margin, McKnight believes there will be more protection as it will be a bit easier to be a property investor. “This will push up demand for investment property.”
Hidden gem One glitch to the market is the falling number of new house consents, but a hidden gem has been lurking in the market. In November, the annual total of new consents was 38,209, compared to May 2022’s peak of 51,015. Opes says there has been no money to be made in development as the margins developers expect have been squeezed drastically. It is difficult for developers to get lending and it is also hard for clients wanting to buy their properties to get funding. Nicol says development is a slow ship to turn, but hidden in the “Seniors” section of the New Zealand First/National coalition agreement is a proposal to allow any small structure up to 60 metres, requiring only an engineer’s report, to be built on the back of an existing property. He points out that if a minor dwelling costs $200,000 and rents for $550 a week, the gross yield is 14.3% – a huge return for
It is sad when people get into the mindset that anything good for landlords is bad for tenants
carving off a piece of unencumbered land in the backyard. McKnight says for investors struggling with higher interest rates, this might be one thing that can be done to improve cashflow – a classic property investment strategy.
Better all round Changes by the coalition government can only mean a boost for the property market, say Cunningham and McKnight. Bank economists’ expectations are that house prices will increase by 7%-10% this year. McKnight says it is important the housing market functions as it should, meaning that people can sell when they want and can access borrowing. “The issue with the bright-line test is that it has caused people to hold on to their properties longer than they want to and stopped the market from functioning properly.” He says there are far fewer listings than 10 years ago because of the unnatural behaviour of people having to hold onto their properties longer than they should. The changes will be better for sellers and buyers and controversially, McKnight says, they will be better for renters. “It is sad when people get into the mindset that anything good for landlords is bad for tenants. It is completely wrong. “What the country needs is a healthy number of homes provided by landlords for tenants. The more landlords we have, the softer rents will be. It does, of course, depend on how steep house price rises are, but generally landlords and tenants are in the same boat.” ■
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New Year message from The Law Association President, Tony Herring Happy New Year to you all and I trust you’ve been able to have a decent holiday break.
Tony Herring
The Law Association has some exciting new initiatives in the pipeline for members
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As we head into 2024, I want to update you on what The Law Association has in store for the coming year, with some exciting new initiatives in the pipeline for our members. First up, following Sue Keppel’s retirement last year, The Law Association council has appointed an interim CEO to steer the ship until a permanent chief executive can be found. We are actively recruiting for this role – in fact, you’ll find a job ad on page 11 of this issue of LawNews, along with details on how to take the next step if you’re interested in applying for the role. Clearly, it’s a critical appointment for The Law Association and we want to take the time to get it right. In the meantime, we’ve engaged Ashley Smout as interim CEO. Ashley is an experienced CEO with a corporate background that includes CEO and COO of Airways Corporation, COO and CCO of NZ Post, general manager (Auckland) of The Property Group and general manager of Emergent (a recruitment company). He also has wide experience as a business and leadership coach. Ashley is looking forward to getting out and meeting you and helping to make The Law Association even better. Ashley steps into the role at a time when The Law Association is going from strength to strength. Membership numbers have grown strongly to 6700, meaning we now have a membership relationship with nearly half of the New Zealand legal profession. And although our head office is in Auckland, 44% of our members now live and practise outside the city. So we’re a truly national organisation and the only independent representative organisation for lawyers in the country. So what’s on the cards for this year? Expect to see some exciting developments on our WebForms platform. Council has approved the business case to develop WebForms 3.0 and we’ve begun work on this project which is designed to improve the user experience and make it easier for lawyers and legal executives to integrate the forms with their own software. There’s a strong focus on cybersecurity to ensure those forms remain tamperproof. We’ll also be releasing a new edition of the Deed of Lease which will be a significant update on previous versions. We’ll develop some CPD around it and are planning to organise a roadshow, with experts explaining the changes and how everything works. Our Deed of Lease is known to be the most evenly balanced agreement between landlord and tenant when compared with other lease forms in the market. The new document includes our learnings from the covid-19 pandemic and our ongoing learnings from the Canterbury earthquakes. It will be a big deal for commercial property lawyers. The Law Association has also been building relationships with the new government. Attorney-General Judith Collins KC is a former President of The Law Association and to kick off the year on a high note, we’re hosting her at a members’ breakfast at The Northern Club at the end of next month. On the CPD front, we are developing new content and new methods for delivery, and planning for our annual Cradle to Grave event is well advanced. When I can, I will continue to attend our collegiality events which will be held at various centres around the country this year. These are a great forum for lawyers to meet in a relaxed environment over some food and a beer or a glass of wine. And finally, our flagship publication LawNews is about to undergo radical change by getting its own website. This means we can offer members and other subscribers legal news, features, opinion and committee updates in real time rather than once a week. I look forward to catching up with you at one of our Law Association events. We have a big and exciting year ahead. ■
Feb 2, 2024 Issue 1
TRUST LAW
Family Court’s limited jurisdiction over trusts creates more cost for litigants The Family Court’s jurisdiction in relation to trusts is ‘limited, piecemeal and uncertain’
Anthony Grant Many New Zealand families have arranged for their homes to be owned by trusts. When their relationships end, s 22 of the Property (Relationships) Act 1976 (PRA) requires that litigation concerning their property is to be filed in the Family Court. But the Family Court has only limited jurisdiction in relation to trusts. When the Law Commission asked lawyers and trust professionals for their input into the legislation that became the Trusts Act 2019, it asked whether the Family Court should be given greater jurisdiction over trusts. The answer was generally No. I suspect this was because lawyers were concerned that the doctrines being used in the Family Court to get around trusts showed a willingness to change the law in ways that might be destabilising and unhelpful for the law in general.
With a lack of enthusiasm for the Family Court to have significant powers in connection with trusts, the commission arranged for there to be only one significant change – s 141 of the Trusts Act. This section authorises litigants to consent to the Family Court having an enlarged jurisdiction over trusts and authorises the Family Court to make orders that it “considers necessary to protect or preserve any property or interest until the proceeding before the Family Court can be properly resolved” or “to give proper effect to any determination of the proceeding”. Beyond these two initiatives, it is not clear what jurisdiction Parliament may have given to the Family Court in connection with trusts. Professor Nicola Peart has described the Family Court’s jurisdiction in relation to trusts as “limited, piecemeal and uncertain”. Her description is correct. The case of Clayton v Barlow [2021] NZFC 6332 is a good illustration of the Family Court’s predicament. In that case, a family home was owned by a trust and the rest of a couple’s assets were valued at less than the relationship debts so there was no relationship property of consequence to give to the parties. This meant the judge was powerless to make any meaningful orders in relation to either the home or any of the parties’ assets.
For most families, the family home is their most significant asset and for many of them it is held in a trust. For litigants in relationship property disputes to be required to go to a court whose jurisdiction to make orders in respect of trusts is “limited, piecemeal and uncertain” is very unsatisfactory. An obvious consequence is that in many cases the litigation will need to be transferred to the High Court. Following the theme of my last article, which concerned the inability of a large number of people to pay the costs of litigation, the outcome is that even more costs and delays are incurred by having to transfer litigation from the Family Court to the High Court. This situation is not likely to be remedied in the near future. Parliament has yet to consider the Law Commission’s proposals for changes to the PRA and the commission’s proposals for the laws concerning what it calls “succession”. Unless someone in the new government has a resolve to tackle these problems, and also has the necessary status to find time in Parliament’s schedule to take charge of the process, it may be years before this unsatisfactory state of affairs is fixed. ■ Anthony Grant is an Auckland barrister and trustee who specialises in trusts and estates ■
Civil Litigation Series Embark on a journey through a civil litigation file with our specially designed five-part webinar series. Starts 8 February 2024.
CPD 09
Photo: Fiona Goodall / Getty Images
CRIMINAL/OPINION
Golriz Ghahraman
Presumed Innocent? How the court of public opinion has already judged Golriz Ghahraman
The criminal law – indeed the rule of law in general – is to prevent mob hysteria in determining whether a person may have committed a crime
David Harvey
David Harvey
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When a person is charged with a criminal offence, that person is presumed to be innocent. What has been described as the “golden thread” running through the criminal law is that the prosecution must prove the guilt of the accused and must do so beyond a reasonable doubt. Those fundamental principles seem to have been lacking in the public and media treatment of Golriz Ghahraman. Initially, there was a suspicion that she may have been involved in a shoplifting incident. I emphasise “suspicion”. Suspicion is like a rumour – it is difficult to find a concrete foundation. Then there was suspicion of a further allegation of shoplifting. Again, a suspicion only. No charges had been preferred. What happened was that Ghahraman was dealt with in the court of public opinion. The presumption of innocence doesn’t seem to apply in that court. Rather, the social media mob presumed guilt. Ghahraman wisely decided not to engage. The rules of procedure – to be impartial before rendering judgment, hear both sides of the case and make a decision based on admissible evidence rather than rumour or suspicion – don’t apply in that court. New Zealanders like to pride themselves on their sense of fairness, but the way Ghahraman was treated by the press and the public was anything but fair. “But what about the video?” do I hear you say? We know nothing of the provenance of that material. We don’t know the circumstances under which it was acquired. We don’t know whose hands it passed through before it appeared online. We don’t know if it has been the subject of manipulation or interference – all too easy in the digital age. Whether that footage is admissible in a court of law has yet to be considered. Clearly, rules relating to
verification and reliability of evidence don’t apply in the court of public opinion. But she resigned. Isn’t that enough? She may have resigned but at law she is still presumed innocent until she has pleaded guilty or has been found guilty after trial and convicted. Her resignation statement was unfortunately worded and from that wording an admission could be inferred. That possibly might be part of the evidence the prosecution may present at trial, or it may be considered by Ghahraman’s legal adviser. The criminal law is there for a reason. It is hedged around with presumptions and rules of procedure and evidence, all designed to provide a framework where a contestable, dispassionate and fair analysis of the evidence may take place before a finding of guilt may be made. The criminal law – indeed the rule of law in general – is to prevent mob hysteria in determining whether a person may have committed a crime. But many people do not understand that. The fact that a person is charged in the minds of many is sufficient to establish guilt; no presumption of innocence there. And when an accused is acquitted, it is because he or she had a “smart lawyer”, that some trick was pulled or that the accused “got off”. Behind those last two words is clearly a presumption of guilt. Ghahraman is entitled to her day in court where she can face the charges. She can put the prosecution to the proof if she so desires. She remains innocent until a finding is made otherwise. And as for the court of public opinion, perhaps a course in civics should be part of the education curriculum so more respect for the rule of law and the processes of the courts are inculcated. And, most importantly, an understanding of the golden thread of the presumption of innocence. ■ David Harvey is a retired District Court judge and a member of Sangro chambers in Auckland ■
Feb 2, 2024 Issue 1
TAX
Is a poppadom a potato chip? Yes, says a UK tax court The title given to a foodstuff is not what determines its VAT rating
Reweti Kohere Picture this: it’s April 1 and you’re in the produce aisle at your local supermarket. You notice that a 250g punnet of strawberries is nearly $4.80 when it’s normally $5.50. In the frozen food section, a half-kilogram bag of mixed berries is nearly $1 cheaper at $6.40. It is April Fools Day, after all, so this has to be a prank the supermarkets are playing, right? The second you go to pay, the checkout operator will surely tell you that the 1kg bunch of bananas in your trolley is its usual expensive price of $3.79. But they aren’t joking: starting from today, fresh and frozen fruits and vegetables are GST-free. But what about the bottle of orange juice that you’re buying: shouldn’t GST be removed from this, given that it’s made with fresh oranges? And what about the shelves of smoothies,
blitzed with a mix of fresh and frozen fruits and vegetables? You wouldn’t have to pay GST on that, would you? It’s the sort of “is this, is this not?” debate that could have become a reality in New Zealand, had the former Labour government fulfilled its 2023 election promise to introduce a GST exemption into a tax system that is elegant for the very reason that it has few exceptions and concessions. The debate would also have created a new tax speciality, a flurry of legal disputes and a line of precedent. As the final arbiters, our courts would have been tasked with determining what was and was not a fruit – with millions of dollars of company profits potentially on the line. Such debates are commonplace elsewhere in the world. Is
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Could you be The Law Association’s next CEO? Following the retirement of our long-serving chief executive, The Law Association Inc (formerly ADLS) is looking for a new CEO. Based in Auckland and reporting to The Law Association’s council, the CEO will lead a team of 25-30 employees and contractors and, in conjunction with council, set the strategic direction for the organisation at a time when the legal profession is facing significant change. You don’t necessarily need to be a lawyer to succeed in this role. But the ability to understand the needs of our 6700+ members and quickly gain credibility within the wider legal profession is critical, along with the ability to advocate for members at the highest levels of government and the profession. Equally important will be your commercial nous which will be put to the test in what is becoming a highly competitive environment. You’ll also bring to the table exceptional leadership and communications skills. The Law Association is New Zealand’s only independent, national membership organisation for lawyers. We’re currently experiencing substantial growth and are keen to build on this momentum. Sound like you?
For a full position description, please contact Ellie Tomoana at ellie@hobsonleavy.com.
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POLITICS/OPINION
How the public service and mainstream media are shafting the government Very few, if any, of the institutions the new coalition government must now rely upon to implement its policies are at all disposed to do so – except under duress
Chris Trotter To appreciate the state of political play as 2024 gets underway, try imagining two very different New Zealanders. The first already collects, or isn’t far away from collecting, his New Zealand superannuation. That makes him old enough to remember the New Zealand that existed before 1984. He recalls Rob Muldoon vividly. Likewise, the country that shut down for the weekend and whose corner dairies advertised something called “spare bread”. It’s not that he necessarily preferred “old” New Zealand. If you were female, Māori or gay it was no bed of roses. But, having lived in a society with radically different priorities, he knows that a group of determined men and women can, indeed, change the world. Or, if necessary, change it back. Our second New Zealander is young, female and brown. Given that Rob Muldoon died before she was born, he might as well be Alexander the Great. This young woman’s entire life has been lived under the grim rubric of neoliberalism. She has never known a powerful trade union movement or widespread public ownership or the difficulties in getting a really good cup of coffee. On the other hand, she has grown up being told (and believing) that girls can do anything and that Te Tiriti o Waitangi is the founding document of Aotearoa. If someone asks for her pronouns, she offers them up without a second thought. Her fondest dream is to one day have a place of her own. Boomers leave her feeling confused and angry – not least on account of the way they vote. 12
These two, the boomer and the millennial, are not the only pieces on the political board; there are plenty of others, But, their inability to project themselves into each other’s life-experiences is fast becoming the determining dynamic of contemporary New Zealand politics. In many respects, the tension between the boomers and the millennials is a straightforward manifestation of the perennial struggle between fathers and sons, mothers and daughters: the future doing battle with the past. The picture is complicated, however, by considerations of race and gender. National, Act and NZ First are more likely to be supported by males than females while the reverse is true of Labour, the Greens and Te Pati Māori. Racially, the Left skews brown, the Right, white.
Boomer power Fifty years ago, considerations of race and gender would have been overshadowed by the issues of class. But neoliberalism’s success in dismantling the institutional mainstays of working-class power (the trade unions and the Labour Party) has left the poor and the poorly-educated politically unprotected. Those who have not given up on politics altogether (a significant number) are prey to opportunistic populists. Consequently, the elites and their professional enablers no longer face any serious political challengers. Electorally-speaking, the class issues no longer count for very much. With working people essentially demobilised and the millennials having scant reason to believe in their own historical agency, bemused boomers find themselves still exercising decisive political influence.
A conservative coalition government more determined to secure its messages at least equal time would already have cleaned out the boards of the state broadcasters
The three parties for which most of them voted are now the three parties of the coalition government. But, National, Act and NZ First have a problem. “Old New Zealand” may have levered them into office but very few, if any, of the institutions the new coalition government must now rely upon to implement its policies are at all disposed to do so – except under duress. Indeed, there are those within the public service who have already leaked privileged information to the news media, working with political journalists whose commitment to impartiality is … questionable. Fifty years ago, the reforming Labour government of Norman Kirk faced a similarly uncooperative bureaucracy. Twelve consecutive years of National Party rule had produced a deeply conservative public service which, using the tactics satirised so brilliantly in the BBC series Yes Minister, did everything
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Feb 2, 2024 Issue 1
Continued from page 12 possible to thwart what it considered to be Labour’s dangerously radical agenda. Fifty years later, with dangerous radicalism having completed its long march through the institutions, it is the turn of conservative reformers to face the entrenched resistance of a “progressive” status quo. The coalition government’s dilemma is complicated by the fact that, just as it was in the 1970s, the generational tide is flowing strongly in the direction of change. The government headed by Christopher Luxon, like the National government headed by Rob Muldoon, has committed itself to turning back the tide.
The resistance Luxon’s job will be made much harder, however, by the ideological incompatibility of the coalition’s policies with the bureaucracy’s values. He should be reminded that, as New Zealand’s economic situation worsened in the early 1980s and Muldoon persisted in ignoring the advice of his Reserve Bank and Treasury officials, the latter began laying the groundwork for the bureaucratic coup d’état that ushered in the neoliberal revolution. Luxon is further hindered by the fact that generationally and ideologically, many members of his own caucus – Nicola Willis, Erica Standford, Chris Bishop (and quite possibly Luxon himself) – feel more at home among the people resisting the coalition’s policies than they do with the people promoting them. Already, on the vexed issue of Te Tiriti o Waitangi, there are signs that National’s limited commitment to Act’s treaty revisionism is beginning to wobble. Hardly surprising, really. Asking liberal GenXers to implement a conservative boomer program is a bit like asking vegans to run a butcher’s shop! The coalition government’s predicament is further
complicated by the fact that the mainstream media is even more committed to “Young New Zealand’s” progressive agenda than the state bureaucracy. With Gen-Xers firmly ensconced in senior editorial positions, conservative voices struggle to be heard. This is as true of the publicly owned media as it is of private publishers and broadcasters. True, there are exceptions; Sean Plunket’s The Platform springs to mind. But these internet-based efforts struggle to compete with taxpayer-funded players like RNZ or TVNZ. There is something qualitatively different about an interview conducted with a conservative political player on Morning Report and/or One News – something that says, “this is serious. This matters.” Certainly, ideas received by a mass audience count for more than the same ideas shared with a handful of supporters listening to a penny-ante podcast. A conservative coalition government more determined to secure its messages at least equal time would already have cleaned out the boards of the state broadcasters and replaced them with more sympathetic (not to say obedient) servants. It may yet happen if RNZ and TVNZ refuse to relinquish their current roles as joint leaders of the resistance. It’s a tough job that Luxon faces. And although he and his colleagues are in the prime of their lives, those whose agenda they were elected to fulfil, the voters who want to “take back their country”, are coming to the end of theirs. The energy for taking on the “gummint” – plentiful in the boomers’ youth – is not so abundant in their 60s and 70s. Although historically-speaking, reactionary movements may trace their origins to old men with too much wealth and power to lose, they are almost always carried to power by political legions of young and fanatical followers, marching behind charismatic “men of action”. Does that sound like Winston Peters? Maybe once.
There are those within the public service who have already leaked privileged information to the news media
What about David Seymour as the Kiwi Caesar? Hard to imagine. It’s what lends New Zealand’s conservative backlash a disconcerting quality of not being entirely serious – like those Trump-supporting “militia men” who report for duty with beer-bellies that speak more of booze and fast-food than they do of making America great again. Christopher Luxon became Prime Minister because far too many younger voters either declined – or simply forgot – to vote, and the angry and disillusioned boomers turned out en masse. Paradoxically, the cultural and economic consequences of young New Zealand’s 2023 no-show will, almost certainly, provoke a record turnout in 2026. And that is only right and proper. For, as the Lebanese-American poet Kahlil Gibran (1883-1931) put it, in that favourite of so many baby boom college students, The Prophet: You may give [your children] your love but not your thoughts, For they have their own thoughts. You may house their bodies but not their souls, For their souls dwell in the house of tomorrow, Which you cannot visit, not even in your dreams. ■ Chris Trotter has more than 30 years’ experience as a political commentator. He is the owner of the Bowalley Road blog ■
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LOCAL GOVT
Courts give councils more scope to hike rates It represents a significant development in the law and provides all councils with a mandate to target rates increases if that’s what is needed to balance the books
Linda Clark & Jeremy Bell-Connell
Linda Clark
As the democratically elected decisionmakers, councils have a wide discretion to set rates as they see fit
Local authorities are struggling to manage rising costs and the demands on rating revenue, making decisions about setting rates more contentious and potentially open to challenge. But last year the courts issued two important decisions which should give councils comfort on that score. The first decision was the high-profile Supreme Court decision in Auckland Council v CP Group Ltd, concerning the accommodation providers’ targeted rate introduced in 2017 and known as the “bed tax”. The Supreme Court upheld the targeted rate and reaffirmed that the bar for successfully challenging a local authority’s rating decision is high. Then came the Court of Appeal’s decision in New Zealand Forest Owners Association Incorporated v Wairoa District Council, which has opened the door for local councils to make an upward adjustment to rates based on the perceived “community disbenefits” of a particular land-use activity. The court held that there does not need to be any rational connection between the benefits enjoyed by targeted ratepayers and the rates they must pay. The Forest Owners decision has attracted less commentary, perhaps because it concerns one of the least populated districts in the country. But it represents a significant development in the law and provides all councils with a mandate to target rates increases if that’s what is needed to balance the books.
Auckland Council v CP Group In this case, the Supreme Court was primarily concerned with 14
the interpretation of s 101(3)(a) of the Local Government Act 2002 (LGA). This provides (among other things) that the distribution of benefits from an activity is a relevant consideration for councils when setting rates. The Supreme Court reaffirmed the longstanding Court of Appeal judgment in Wellington City Council v Woolworths NZ Ltd (No 2), which held that, as the democratically elected decision-makers, councils have a wide discretion to set rates as they see fit. The decision firmly established “that a rating system…remains primarily a taxation system and not a system inherently based on the principle of user-pays”. Councils do not need to undertake a user-pays analysis when setting rates. The Supreme Court rejected the submission that for targeted rates there must be a “close correlation” between an activity and its benefits for the targeted group. But the court found there was a “rational connection” between targeted rates and benefits received.
Forest Owners The forest owners were challenging the Wairoa District Council’s decision to impose a higher rating differential for the general rate on forest owners in the district. The primary reason given by the council was to recover the estimated roading costs attributed to forestry by the council’s working group. However, the revenue raised by the differential rate was almost 300% more than was needed to cover the roading costs.
Continued on page 15
Feb 2, 2024 Issue 1
Continued from page 14
What is the relevant law? Under s 101(3)(a) of the LGA, when setting rates, a local council must consider (among other things): ■ the distribution of council benefits between the community as a whole, any identifiable part of the community, and individuals; and ■ the extent to which the actions or inaction of particular individuals or a group contribute to the need to undertake the activity. Accordingly, while rates do not have to be allocated on a userpays system, the rates paid and benefits received are matters that must be considered by a local authority. The Forest Owners case turned on the second mandatory consideration for local councils when allocating rating liability. In particular, it concerned the interpretation of s 101(3)(b) of the LGA, which says a local council, when allocating rating liability, must consider “the overall impact of any allocation of liability for revenue needs on the current and future social, economic, environmental and cultural well-being of the community”. The Wairoa District Council relied on this section to make an upward adjustment to the rating burden on forest owners from $1,594,248 to $2,795,097. Invoking s 101(3)(b), the adjustment was made to reflect the perceived “community disbenefits” of forestry.
The Court of Appeal upheld the council’s rating decision. It held that there is no requirement that rates paid by targeted owners bear any relationship to benefits received from council services. But what of the Supreme Court’s reference to “rational connection”? What the Supreme Court meant, according to the Court of Appeal, is that the decision must be justified by reference to the mandatory considerations under s101(3) of the LGA. In other words, a rating decision will be lawful, provided that councils refer to the statutory criteria when making the decision, regardless of whether there is any correlation or rational connection between the rating quantum and the mandatory considerations.
Legal developments
Rates can now reflect perceived community disbenefits of land-use activities The forest owners said s 101(3)(b) allowed councils to consider the impact of proposed rates on ratepayers (for example, the affordability of the rates), but not the impact of ratepayers’ activities on the community. This was especially the case when the perceived community disbenefits had no impact on the council’s revenue needs. The Court of Appeal disagreed. It held that the wellbeing of the community would ultimately affect the council’s revenue needs. Accordingly, councils can now upwardly adjust rates to reflect the view that certain land-use activities are bad for the community. Ultimately, the courts have made it clearer that rating decisions made by elected representatives are better tested at the ballot box than through judicial review proceedings. ■
No requirement for any rational connection between the benefits enjoyed by targeted ratepayers and the rates they must pay
Linda Clark is a partner and Jeremy Bell-Connell is a senior associate at Dentons Kensington Swan ■
Jeremy Bell-Connell
Councils do not need to undertake a user-pays analysis when setting rates
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15
COMMITTEES
Meet Emma Priest, co-convenor Parole and Prisoner Rights committee You need to be able to listen and make sure that everyone gets a chance to be heard so their views are represented
Brenda Newth Where do you work, what’s your role? I'm a criminal barrister and I work at Augusta Chambers in Auckland. Julie-Anne Kincade KC and I are heads of chambers and there are 14 barristers and lots of juniors, so around 20 of us in total.
Where did you study?
Emma Priest
I did my first year at Canterbury University but I wasn't studying law. I was doing sociology and English and then I did law as a fill-in paper. It meant I got Fridays off. I ended up loving the law. I decided I should transfer to what I perceived to be a really strong legal university at the time, which was Auckland. So I moved back home (it was also too cold in Christchurch for me). I did a BA in psychology and my law degree. And then I did a master's in law at Auckland as well. At the end of my degrees, I was quite undecided about whether I would end up doing clinical psychology or law. I consulted a career-focus book, which ended up telling me I could either be a forensic psychologist working within the courts or I could be a criminal barrister with the benefit of my psych undergrad. So I ended up going down the criminal law route and did a law masters. I was working for a (then) Queen’s Counsel while I was studying and then I did my profs while I was working part-time. After that, I decided to do my masters before I started work and I got scholarships to do that.
What’s been your career to date? After my masters, I went into general practice for about 18 months. I wanted to learn how to buy and sell a house, how to write a will, how to set up a company and a trust. I was then approached to interview at 16
Meredith Connell which is the Crown solicitors; MC as they call it now. I got a role there. Initially I was based up in the High Court Crown room with a lawyer called Kieran Raftery, who is now a KC. It was incredible to work with him. From there I've worked with Phil Hamlin, and Christine (now Justice) Gordon. My boss at that time was Simon Moore (now Justice Moore). I've worked with Mark Woolford, who's now Justice Woolford. I've got to work with loads of great people including loads of DCJs (District Court Judges) who have come out of Meredith Connell too, as well as some of my chambers’ mates. I stayed at Meredith Connell for 11 years and was an associate when I left, after I had my third baby. I joined the Public Defence Service, working there as a team leader, part-time for about two years. I worked there with Sue Gray, who had been my previous partner at Meredith Connell. From there, we both went out and set up Blackstone Chambers with Julie-Anne Kincade. We were at Blackstone Chambers doing defence work for seven years before we outgrew that space. We moved last year to a new space, Augusta Chambers, which is roughly double the size of Blackstone Chambers but with the same number of people.
How long have you been involved with The Law Association committees and which committees have you worked with? I started on the Criminal Law committee about four or five years ago. And then Marie Dyhrberg KC wanted to set up a Parole Committee. So Marie organised for me and another barrister, Lucy Smith, to be the original co-conveners of that committee. Lucy has since gone to the UK and Hannah Kim has come onto the committee. We share that role and we expanded
Continued on page 17
Feb 2, 2024 Issue 1
Continued from page 16 the name from the Parole Committee to the Parole and Prisoner Rights committee, largely out of the covid-19 work that we did, where the mandatory minimum entitlements for prisoners were not being met by the government. We went into a strong advocacy role, where we would work with the prisons. We made complaints to the inspectorate and lobbied for prisoners to get their minimum entitlements back. Out of that there's been a big report, which has recognised the failures of Corrections and made a number of recommendations, all of which have been taken on board by Corrections. I resigned from the Criminal Law committee last year, because I've moved on to the executive of the Criminal Bar Association and I'm also involved in the New Zealand Bar Association.
Why is committee work important? The government and key stakeholders, like the courts and the prisons and the Ministry of Justice, need to engage the profession. They often do that through the membership organisations, such as The Law Association. You get an opportunity to make submissions and change the law. We also get to advocate in our role for prisoners, which is really important. We have a direct audience with people who have the capacity to improve the law. One example is that our committee meets with the Parole Board chairperson, Sir Ron Young, several times a year. And he tells us things he sees as problems and we tell him things that we see as problems. And hopefully between us we can solve those problems together. We also meet with Legal Aid, we have meetings with the prisons. We're part of stakeholder groups.
There will be more and more people with really complex needs who unfortunately get help only when they come up against the criminal justice system lawyers in parole hearings is quite low. One of the big pushes at the moment from Sir Ron Young is that he wants more prisoners to be represented by lawyers. We advise clients on what's needed to get early release on parole. We present that information in a concise and cohesive way for the parole board, so it makes the job easier for them, too. One of our biggest things that we're doing as a committee is CPD. Hannah and I have taught parole basics and more complex parole law. One purpose of that is raising the profile of parole law as an area of law to practise, but we are also helping people to upskill because parole work is not done publicly. It's really important that people can have the opportunity to observe us (which anyone can if they're interested in parole law) or they can just contact us and come and observe a hearing.
How do you see the role of a committee convenor? What specific skills do you think a convenor needs? The role of a convener is to try and bring people together and make sure you can collect the views of all your committee members on the basis that they're representative of the wider profession. We try to find common threads to get consensus, and then move forward with projects, or with whatever we’re going to do. In terms of specific skills, you need to be able to listen and make sure that everyone gets a chance to be heard so their views are represented.
How do The Law Association committees make a difference?
What is your biggest frustration as a convenor?
Contribution to legislation and regulation, but also in the case of our committee we can influence day-today impacts for prisoners and make sure that rules and laws are adhered to. For parole law in particular, the number of prisoners who are represented by
There's always the frustration of trying to fit this work in around a really busy practice. Often, we'll be given a piece of legislation to consult on, one example being the Corrections Act amendments. We had very little time to consult on it. We did a 24-hour
turnaround that involved me working until midnight and Hannah working from midnight until about 3am or 4am. And we were able to get that submission away the following day. Other frustrations are when the government's trying to pass things under urgency. And it just says, “we're doing this” and that's really frustrating because it's a knee-jerk reaction to a problem. And the decision not to consult can have a massive impact once the law is enacted. And, of course, they deal with the fallout, the interpretation through the courts, that sort of thing. We don't like things being passed under urgency.
What’s been the most notable achievement or biggest focus of your committee over the past few years? Why was that important? We've achieved increased funding through Legal Aid for parole work in terms of additional fixed fees being added, which I think was really good. The other thing we did was to make the initial complaint to the Office of the Inspectorate about minimum prisoner entitlements not being met. That then triggered a full inspectorate investigation, which then came back with the report. Corrections has accepted all the recommendations (more than 50 of them), which effectively meant we've been part of reinstating minimum human rights for prisoners, post-covid. There are still a few problems. I was seeing a client in the maximum-security management wing which is Unit 10 in Auckland Prison and he's still not getting inperson whānau visits, which is a minimum entitlement. So that's one thing I need to raise directly with the prison and the inspectorate.
Continued on page 18 17
Continued from page 17 We’re also raising the profile of parole law. I got to speak in Wellington at the Criminal Law Symposium on parole with Sir Ron Young, which hopefully will generate more interest, generate more lawyers doing this kind of work, which means more prisoners get access to justice, which is ultimately the goal.
Over the past year, has your committee made submissions on a parliamentary bill or any consultation paper? The inspectorate investigation is the big one.
What would you say to anyone thinking of becoming involved in a Law Association committee? If you have a broader or a wider interest in trying to change the way the law works, either at a high level or just on a really practical level, I think people should look at getting involved. I would invite people to consider the time commitment though and make sure they have three to five hours a month to do the work. I think it’s important for people to know there's an expectation that you do work outside of the committee meeting.
What’s the biggest issue facing your practice area at the moment? And how does that affect lawyers and their clients? There are two. The first is access to justice, which is about making sure that prisoners get access to legal representation for Parole Board hearings. The second: there's a big distinction between the way extended supervision orders and public safety orders clash with, or are in conflict with, the New Zealand Bill of Rights Act 1990. This has been recognised in a number of cases, which effectively say there's a breach of the Bill of Rights Act and thee orders are effectively imposing sentences on people who have otherwise finished them. They have to be made by court order but they infringe things like double jeopardy, the right to freedom of movement and the right to freedom of association. There's are 18
The number of prisoners who are represented by lawyers in parole hearings is quite low
lots of different aspects of the New Zealand Bill of Rights Act which are triggered and this has been recognised in the amendments to the Corrections Act. It's quite a hot topic.
What’s the best kept secret about The Law Association? The functions. Held in beautiful venues, you get to meet people from across the profession who are equally passionate about their area of law. It provides a unique opportunity to network and socialise with people from all different types of law.
What is the biggest issue facing the legal profession right now? I can only come at it from a criminal law perspective but I think broader societal issues around the divide between rich and poor, deprivation, disadvantage, lack of opportunity, addiction, mental health, brain injury and undiagnosed learning difficulties are growing in complexity and severity. For those of us at the coalface, I think we are having to address these societal failings on a daily basis. And there will be more and more people with really complex needs who unfortunately get help only when they come up against the criminal justice system. It's real “ambulance at the bottom of the cliff” stuff. And when people are so disadvantaged or desperate or unwell or addicted that they turn to crime, it's a poor model in my view in terms of this being the time when we get them help. Obviously, prevention is a far better model and I would definitely endorse that.
Have you done any media interviews/ provided any statements to the media in the past year as a committee convenor and spokesperson for ADLS/The Law Association? I do written media. I don't do much oral or verbal
media because I need some upskilling in that area. I have done some podcasts. I have provided written content to media as a committee convener, particularly around prisoners’ rights. I also do OpEds for The New Zealand Herald (under my own byline) from time to time. They let me write about things that upset me, which is nice of them.
What is your vision for the legal profession in 2050? In criminal law and parole law, it would be a system where everyone gets access to justice, which means people have the ability to get legal advice whether they can afford it or not. And that ultimately justice can be done.
What do you think The Law Association could do to improve its offering to members? More connection with the law schools. I think that helping law students to understand all the different types of law that are available (not just corporate) and helping them to make connections in the profession would be great. It would be good to foster those connections with internships, summer clerks or winter interns. It’s really difficult for individual barristers to do that. I think it'd be quite cool for info packs to go out to students every year, fostering student membership. We’re pretty good on the committees; we have the EJP (Equal Justice Project) students working with us. It's really valuable to have their voices and I think they enjoy seeing the committee work. ■ To find out more about the professional, collegiality, and networking opportunities associated with being involved in Law Association committee work, please contact Daniel.Conway@thelawassociation.nz or Moira.McFarland@thelawassociation.nz ■
Feb 2, 2024 Issue 1
Briefs
Lawyer – Commercial & Property
ANZ cracks down on scammers The ANZ bank in Australia has warned that a handful of the country’s banks have become the destination of choice for scammers, with ANZ’s new detection systems picking up 3200 accounts linked to suspicious activity. The Australian reports ANZ is concerned that its efforts to stamp out mule accounts is leading to criminal groups setting up at other banks with slacker know-your-customer requirements and little monitoring of accounts. The Australian government has set up a National Anti-Scam Centre while the banking industry has signed a landmark co-operation deal to help deal with the problem. The centre says between July and September last year, Australians lost more than A$114 million to scams. By the end of this year, the country’s banks will be required to implement controls to prevent identity fraud and adopt at least one biometric check for new customers opening accounts online. Here in New Zealand, banks do not do even basic checks such as ensuring when funds are transferred that the name on the payee’s bank account matches the account number and none of the country’s regulators is tasked with investigating and prosecuting scammers.
Sir Michael Hardie-Boys dies Chief Justice Dame Helen Winkelmann paid tribute to former Governor-General, Court of Appeal Judge and Privy Councillor Sir Michael Hardie-Boys who died on 29 December at the age of 92. The Chief Justice said Sir Michael was a great New Zealander who spent his life, in one way or another, in service to New Zealand. “He was a gifted lawyer and made a significant contribution to the law, particularly in areas that were during his time on the bench, developing under great pressure of external events,” she said. His appointment to the Court of Appeal coincided with the enactment of the NZ Bill of Rights Act 1990. “Sir Michael wrote judgments in many of the significant early cases that address how the NZ Bill of Rights Act should be applied, particularly in relation to criminal procedure and the law of search and surveillance.” Chief Justice Winkelmann said of particular note were R v Goodwin in which the Court of Appeal discussed the meaning of arrest and the circumstances in which evidence with be excluded from breach of the rights confirmed in the Bill of Rights Act, and Simpson v Attorney-General (Baigent’s case) which confirmed the availability of damages under the Bill of Rights Act for breach of rights – in that case an unreasonable search. His time as a judge also coincided with important developments in the law of negligence and, in particular, how the tort applied in the context of defective buildings. Sir Michael served as GovernorGeneral from 1996 (when he oversaw the first MMP election) until 2001.
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19
POLITICS/CONSTITUTIONAL LAW/OPINION
US Supreme Court decision on Trump-Colorado ballot case ‘monumental’ for democracy itself, not just 2024 presidential election The Supreme court decides questions with major political consequences all the time. But to decide the questions in the context of an upcoming election feels different Momentous questions for the US Supreme Court and momentous consequences for the country are likely now that the court has announced it will decide whether former president and current presidential candidate Donald Trump is eligible to appear on the Colorado ballot. The court’s decision to consider the issue comes in the wake of Colorado’s highest court ruling that Trump had engaged in insurrection and therefore was barred from appearing on the state’s GOP primary ballot by Section 3 of the 14th Amendment to the US Constitution. Maine’s secretary of state also barred Trump from the state’s primary ballot and more than a dozen other states are considering similar moves. The Conversation’s senior politics and democracy editor, Naomi Schalit, spoke with Notre Dame election law scholar and law professor Derek Muller about the Supreme Court’s decision to take the case, which will rest on the court’s interpretation of a post-Civil War-era amendment aimed at keeping those who “engaged in insurrection or rebellion” from serving in political office.
On a scale of one to 10, how big is this? In terms of potential impact, it’s a 10. It is excluding a former president from appearing on the ballot for engaging in insurrection. That’s monumental for several reasons. It’s the first major and material use of this provision of the Constitution since the Civil War. It’s the first time it has kept a presidential candidate off the ballot, much less a former one and the apparent front-runner for the Republican Party nomination. But on the flip side, what are the odds of that actually happening? That’s more speculative. And so the number is probably less than 10. This was an extraordinary major decision from the Colorado Supreme Court. But you have to temper that by saying, well, there’s a chance it gets reversed and then Trump appears on the ballot and this mostly goes away.
What are the risks here for the court? Legal 20
It’s the first major and material use of this provision of the Constitution since the Civil War
scholar Michael W McConnell at Stanford said in The Washington Post, “There is no way they can decide the case without having about half the country think they are being partisan hacks.” This is a binary choice that either empowers the Republican candidate or prevents voters from choosing him. So when you have a choice in such stark, political and partisan terms, whatever the Supreme Court is doing is often going to be viewed through that lens by many voters. I think it’s a reason why there will be as much effort as possible internally on the court to reach a consensus view to avoid that appearance of partisanship on the court, that appearance of division on the court. If there’s consensus, it’s harder for the public to point the finger at one side or another. That’s much easier said than done. The court decides questions with major political consequences all the time. But to decide the questions in the context of an upcoming election feels different.
The justices granted only Trump’s appeal to consider the case, not the Colorado Republican Party’s. Is this significant and, if so, how? The Colorado Republican Party and the Trump campaign were on two different tracks in their appeals. When you grant both cases, you invite two sets of attorneys and parties to participate and add complexity. I think the decision to grant only Trump’s case is a decision to make this as streamlined a process as possible.
Will whatever decision the court makes put to rest the ballot access questions in all the other states? There are a couple of very narrow grounds the court might rule on. For example, it might say, “we’re not ready to hear this case because it’s only a primary”, or “Colorado so abused its own state procedures as to run afoul of federal constitutional rules”. Those would be kind of rulings only applicable to the Colorado case or only applicable in the primaries. There’s a chance the court does this but my sense – not to speculate too much – is that’s going to be deeply unsatisfying
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Feb 2, 2024 Issue 1
Continued from page 20 for the court, knowing that if it delays in this case, another case is likely coming later in the summer where these questions will have to be addressed in August or September. That’s much closer to the general election. Those are months when the court is in recess and it would have to come back from summer vacation early. So my sense is that the court will try to resolve these on a comprehensive basis. It has scheduled oral argument on 8 February 2024 so it wants to move on as quickly as possible to put this to rest.
You submitted an amicus brief in the Colorado case for neither side. What did you want to tell the court? I raised two general points and then one specific to Colorado. The two general points are that I think states have the power to judge the qualifications of presidential candidates and keep them off the ballot. And states have done that over the years to say, “if you were born in Nicaragua, or you’re 27 years old, we’re going to keep you off the ballot”. But I also say states have no obligation to do that. You can look throughout history, going back to the 1890s, where ineligible candidates’ names have been printed and put on the ballot. And this isn’t a question of whether or not the state wants to do it – states have the flexibility to do it. So I wanted to set up those two framing questions so the court doesn’t veer too much in one
direction or the other to say “states have no power” or “of course states have power regardless of what the legislature has asked them to do”. The point specific to Colorado is that I doubted there was jurisdiction in Colorado for the state Supreme Court to hear this case but the court disagreed with me.
What could happen during the period between now and the court’s decision that could be consequential? More states are going to consider these challenges as the ballot deadlines approach. And we know there’s Super Tuesday, the first Tuesday of March, when a significant number of states hold presidential primaries. So I think there’s a lot of uncertainty in the next six weeks about which states might exclude him. On top of that is voter uncertainty. Voters are making their decisions and weighing the trade-offs of who to vote for. Right now, this is a cloud hanging over the Trump campaign. It’s not just that he’s been declared ineligible in Colorado and Maine. It’s the question in other states for other voters: Am I wasting my vote? Is this actually an ineligible candidate? Should I be voting for somebody else? That’s not an enviable position for voters to be in – that they might cast their ballots only to find out later that they’re not going to be counted. ■ The above first appeared in The Conversation and is republished with permission ■
The Annual Property Law Conference 2024 4 CPD Hours Thursday 29 February In Person
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11:45am – 12:30pm Lunch 12:30pm - 5:00pm Conference 5:00pm – 6:30pm Networking
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21
SUPREME COURT
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Senior Solicitor (min 6 years’ PQE) Civil Litigation/Relationship Property/General Practice Law & Associates is seeking an enthusiastic, motivated solicitor to join our small, friendly team in our busy Manukau practice. Work/life balance is important to us. We have modern offices, free onsite car parking and offer flexible working arrangements, a competitive salary and excellent prospects for the right person. If you wish to take the next step in your career and: • have excellent interpersonal skills; • a proven track record; • enjoy a diverse workload and client contact; • are results driven; please email your resume to info@lawassociates.co.nz
Ph: (09) 303 5270
BAIRA Zabron Chitume
PANDITHARATNE Chulanie Lanka
• Late of 1/36 de Haviland Drive, Goodwood Heights, Auckland • Quantity Surveyor • Aged 66 / Died 27’09’22
• Late of 37 Barbados Drive, Unsworth Heights, Auckland • Marketing Executive • Aged 65 / Died 30’10’23
COLMORE-WILLIAMS David Winston
Tony Horrocks is available for locum and part-time consultancy work (flexible as to location).
Many years’ experience, both as a sole practitioner and as a partner in a small law firm, in general practice, with particular expertise in trusts, estate administration, and business law. Contact me by email: anthonycharleshorrocks@gmail.com or on mobile: 021 754312.
Advertise your business Get your message in front of our readers comprised of nearly 6,000 lawyers, judges, politicians, and academics. Contact our account manager Darrell Denney M 021 936 858 E darrell.denney@thelawassociation.nz
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• Late of Auckland • Aged 83 / Died 20’10’23 KUMAR Arun • Late of Auckland • Aged 64 / Died 23’09’23 LUI Wallace • Late of 4 Lawford Place, Mangere, Auckland • Aged 54 / Died 31’10’23 NOBILI Christian Mauro • Late of Auckland • Credit Risk Analyst • Aged 35 / Died 26’07’23
POCHING Samuel Uluave • Late of 261 Mt Albert Road, Mt Roskill, Auckland • Mechanic • Aged 57 / Died 25’11’23 REID Grant Richard • Late of Auckland • Beneficiary • Aged 70 / Died 10’12’22 WEST Kenneth Barry • Late of 39 Batkin Avenue, New Windsor, Auckland • Never in a legal relationship • Retired • Aged 95 / Died 06’10’23
Feb 2, 2024 Issue 1
Briefs US approves bitcoin ETFs The US Securities and Exchange Commission (SEC) has voted to allow mainstream investors to buy and sell bitcoin as easily as shares and mutual funds, clearing the way for the first US exchange-traded funds that hold bitcoin to be sold to the public. The news drove the price of bitcoin to just below US$46,000 (NZ$73,679) – its highest level in two years. Until now, retail investors wanting to buy and sell digital currencies in the US have had to trade on crypto exchanges and incur hefty transaction fees or buy products that track bitcoin in less direct ways.
Judicial promotions Just before Christmas, Attorney-General Judith Collins KC announced several appointments within the senior courts: Court of Appeal Judge Forrest Miller was appointed to the Supreme Court; Chief High Court Judge Susan Thomas was appointed to the Court of Appeal, along with High Court Justices Rebecca Ellis and Francis Cooke; Justice Sally Fitzgerald becomes the new Chief High Court Judge; and District Court Judge Karen Grau was appointed to the High Court.
Unchartered territory Former US President (and 2024 presidential hopeful) Donald Trump has been ordered to pay US$83.3 million (NZ$136.7m) to journalist E Jean Carroll after a New York jury found Trump had sexually abused and defamed her. Carroll says she will give the money “to something Trump hates”. Despite taking out the GOP primaries in Iowa and New Hampshire, Trump is before the US courts on multiple other fronts. Most seriously, he faces dozens of felony charges across four cases: two Federal, one in New York and one in Georgia, plus a civil trial in New York where he is accused of fraudulently inflating the value of his assets to obtain better loan and insurance deals. The felonies include conspiracy to defraud the US, conspiracy to violate civil rights (his attempts to reverse the results of the 2020 election) and charges relating to his attempts to obstruct the voting certifications process. The cases are proceeding at speed and verdicts in at least some are expected before the November election, but, according to The New York Times, “The constitution and American law have answers for only some of the questions that will be asked if he is convicted.” Others, the Times says, “will bring the country into truly unchartered territory, with huge decisions resting in the hands of federal judges”. Trump can still run for president if convicted although the 14th Amendment disqualifies anyone from holding office who “engages in insurrection or rebellion” after taking the oath to support the Constitution. Nobody knows what might happen if he were elected from prison, nor if cases against him were still in progress. The Times notes while Trump might legally be eligible to remain president, “the election would create a legal crisis that would likely need to be resolved by the courts”.
Queen City Law NZ Limited Senior Litigation Consultant for existing Litigation Team Role: We are seeking a highly skilled and motivated Litigation Consultant to join our dynamic team. The successful candidate will play a pivotal role in leading and managing complex litigation cases, providing expert legal advice, and representing our clients in the courts. As a senior litigator, you will be responsible for: • Handling a diverse caseload of complex litigation matters, • Providing strategic legal advice to clients, • Conducting legal research and preparing briefs, • Representing clients in court proceedings, • Negotiating settlements and alternative dispute resolutions, • Building and maintaining strong client relationships; and • Providing strong mentorship for intermediate and junior staff. Comments: • May suit existing team or partner in existing firm looking for a change of scenery and culture, • Substantial internal referral workflow coupled with client base spells success, • Proven track record of success in handling complex litigation cases, • Excellent written and oral communication skills, • Strong analytical and problem-solving abilities, • Ability to work independently and as part of a team, • Knowledge of New Zealand legal procedures and regulations; and • Knowledge and experience with alternative dispute resolution methods such as negotiation, mediation, and arbitration. Application process: Interested candidates are invited to submit their CV to Marcus Beveridge, or contact him for further information, using the following contact details: marcus@queencitylaw.co.nz 027 487 7332
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FEATURED CPD
Civil litigation series | drafting pleadings: principles and practice WEBINAR INTERMEDIATE CIVIL LITIGATION
FINAL NOTICE
Webinar 2 CPD hours Thursday 8 February 4pm – 6pm Price from $190 + GST Presenters Martin Smith, partner, Gilbert Walker; Garry Williams, barrister, Richmond Chambers
As the first in a series of five, join us to uncover the pivotal role well-crafted pleadings play in guiding the court and parties and in shaping outcomes. While some consider pleadings to be of little importance, this view is misguided. Join our webinar to understand why properly drawn and detailed pleadings serve as a crucial roadmap. Discover how these documents, rather than briefs of evidence, establish the true parameters of a case.
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Excel-erate your tasks
Workshop 2 CPD hours Wednesday 14 February 9am – 11am Price from $320 + GST Facilitator Sally Ratapu, project support/technology learning advisor, Simpson Grierson
WORKSHOP ALL LEVELS ALL AREAS
Through a curated toolkit of tips, tricks and practical case scenarios tailored for this session, Sally Ratapu will guide you through the maze of Excel. Learn how to transform raw data into structured, visually appealing and easily interpretable information. Amplifying your productivity and data analysis skills. This hands-on experience will also help you to create dynamic and tailored workbooks, enabling you to efficiently manage data with precision and ease. FIND OUT MORE
Guardianship under CoCA WEBINAR ALL LEVELS FAMILY
Webinar 1.5 CPD hours Wednesday 14 February 4pm – 5.30pm Price from $140 + GST Presenters Judge Belinda Pidwell and Cushla Webster, barrister, Albert Chambers Chair Brian Carter, barrister
This webinar, with bench and bar perspectives, aims to provide direction and insights into what evidence is essential, and what is useful, for determining guardianship disputes.
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Feb 2, 2024 Issue 1
thelawassociation.nz
Business development for lawyers
CPD@thelawassociation.nz
Workshop 1.5 CPD hours Thursday 15 February 2024 9.30am – 11.45am Price from $320 + GST Facilitator Ben Paul, CEO, The BD Ladder
09 303 5278
Are you struggling to attract new clients or win business? Are you unsure about how to approach business development? Or do you just feel as if you’re not making progress?
WORKSHOP ALL LEVELS ALL AREAS
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Will drafting for blended families WEBINAR ALL LEVELS WILLS
Webinar 1.5 CPD hours Thursday 15 February 12.30pm – 2pm Price from $140 + GST Presenters Henry Stokes, group general counsel & company secretariat, Perpetual Guardian and Theresa Donnelly, legal services manager, Perpetual Guardian
Presented by two experts, this webinar will highlight the key issues for will-drafters, including the considerations that apply and clauses to address them, and case law to demonstrate what has happened when things go wrong.
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KiwiSaver for legal professionals
Webinar 1.25 CPD hours Tuesday 20 February 1pm – 2.15pm Price from $140 + GST Presenters Sky Leigh, senior financial adviser, Haven Accountants and Financial Advisers
With a new financial year on the horizon, it’s the perfect time to take stock of your financial position and prognosis – including your KiwiSaver status. Our presenter will provide information and insights for both the self-employed (partner, principal, consultant) and employed solicitor situations.
WEBINAR ALL AREAS ALL LEVELS
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Continued from page 11 a Jaffa cake a cake or a biscuit? (For tax purposes, they are cakes). Is a deep-dish pizza, of the kind you find in Chicago, really pizza – or a savoury pie? (Not yet settled). Are hot dogs sandwiches? (According to the late US Supreme Court judge Ruth Bader Ginsburg, they are). Are Pringles potato chips? (For tax purposes, again, they are chips). What about a light, crispy poppadom-like snack, topped with zesty, spiced flavours – are they potato chips (or “crisps” as the British call them)?
Potatoes and red herrings In response to that debate, British potato chip manufacturer Walkers, a subsidiary of American food and beverage giant PepsiCo, recently got an answer. In a decision released by the UK’s First-Tier Tribuanl Tax Chamber on January 10, Walkers’ “Sensations Poppadoms”, in lime and coriander chutney and mango and red chilli chutney, are said to be the same as potato chips and, therefore, attract the same valueadded tax (VAT) rate as other snacks do.
It’s been a yearslong dispute for Walkers, which appealed a decision by HM Revenue and Customs in June 2021 that held the manufacturer had to pay the standard 20% VAT because the products were similar to potato chips. Walkers had contended the products fell within a category of food that was effectively taxexempt under the Value Added Tax Act 1994. There were various reasons why poppadoms weren’t chips, Walkers argued. Like most foods, its poppadoms – a snack originating in the Indian subcontinent – were meant to be eaten with other things such as chutneys and dips. In legalese, further preparation was needed before consumption. The argument fell by the wayside, however, as Walkers accepted there was nothing on the product packaging stating that any preparation was needed and its promotional material showed people eating them straight from the packet. Walkers also argued an “ordinary person on the street” would have appreciated that poppadoms weren’t chips. Presiding tribunal judge Anne Fairpo and member Sonia Gable rejected this, instead assessing the extent of similarity between the
Briefs
products against multiple factors. One such factor: the potato content. Broadly, the two flavours contained between 17.5% and 18% potato granules, the same percentage of potato starch and just over 4% modified potato starch. Walkers argued that, at best, the poppadoms derived just over a third of its ingredients from potatoes – an amount far lower than comparable potato chips. The tribunal wasn’t moved, concluding that at about 40%, there was “more than enough” potato in the snacks. Balancing all the other factors, “we consider that the products are similar to potato crisps. They are packaged and sold in a manner similar to potato crisps. Removing them from their packaging, we consider that their appearance and texture is similar to potato crisps,” the tribunal held. “The use of the word ‘poppadom’ is something of a red herring (to badly mix foodstuffs). The title given to a foodstuff is not what determines its VAT rating – what matters, in this particular case, is whether it is similar to a potato crisp and is made from potato.” Read the decision here. ■
Inflation down
ChatGPT copyright suit The New York Times has sued OpenAI and Microsoft over the unauthorised use of copyrighted work, saying millions of articles from the Times have been used to train chatbots that now compete with the publication as a source of reliable information. It is the first major US media organisation to sue the creators of ChatGPT and other popular AI platforms over copyright issues. The suit does not include an exact monetary demand but says the defendants should be held responsible for “billions of dollars in statutory and actual damages” relating to the “unlawful copying and use of the Times’s uniquely valuable works”. It also wants the defendants to destroy any chatbot models and training data that use copyrighted material from the Times.
New Zealand’s inflation rate for the year to December 2023 came in at 4.7% the first time since September 2021 that annual inflation has come in at under 5%. The biggest contributors were rises in housing and household utilities prices. At the same time, Inflation across the Ditch has fallen to a two-year low, with prices rising 4.1% in the December quarter, raising hopes that the Reserve Bank of Australia (RBA) will not hike interest rates again when it meets next week. As in New Zealand, the Australian central bank wants to see inflation back within the 1% to 3% range – a target it’s not expected to hit until December 2025. The biggest contributors to inflation during the past year in Australia have been gas (up 12.9%), electricity (up 8.8%), alcohol and tobacco (up 6.4%) rents (up 7.1%) and financial services (up 8.8%). Australia’s Official Cash rate is 4.35% (5.5% in New Zealand). ■
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Annual General Meeting Thursday 7 March 2024 l 5.30 pm | PwC Tower, Level 30, 15 Customs Street West, Auckland
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