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Statutory decision-making - some reasons to give reasons

October 20, 2017


Partners Sally McKechnie

Local government Public law

Welcome to the first edition of our Public Law Update, which provides informative comment on recent legal developments and cases in the public law arena in New Zealand.

In this edition, we look at two recent decisions from the Court of Appeal and High Court, which each considered the nature and scope of the duty to give reasons. For statutory and public decision-makers, the decisions highlight the importance of giving clear and adequate reasons, as a matter of good administrative practice, and the risks to the integrity of the decision-making process when this is not done.

Ngāti Hurungaterangi v Ngāti Wahiao

The first case, Ngāti Hurungaterangi v Ngāti Wahiao [2017] NZCA 429, concerned a 2008 agreement between Māori and the Crown for the return of certain ancestral lands after 115 years of Crown ownership. Two iwi groups, Ngāti Whakaue and Ngāti Wahiao (each representing various hapū interests), had competing claims to exclusive mana whenua, or beneficial ownership, in the lands. The relevant legislation provided for the dispute to be resolved by arbitration.

An arbitral panel held hearings over 13 sitting days and received extensive historical evidence about the lands and iwi involved. The panel delivered a relatively brief award determining that the land should be apportioned equally between the two iwi. Dissatisfied with this outcome, Ngāti Whakaue appealed the panel's decision all the way up to the Court of Appeal. A focus of the appeal was an alleged lack of reasons in the arbitral decision.

The Court of Appeal decision

The Court examined the purpose, nature, and scope of the arbitral obligation to give reasons - concluding that while the reasons did not have be as extensive as may be expected of a formal judgment, as a matter of fairness they had to be "sufficiently full for the parties to understand the pathway taken by the panel to explain the result". Here, what was required was the panel's formulation of issues by reference to the parties' determination notices, discrete analyses of the competing claims to mana whenua to the relevant land, and a "logical and coherent" explanation for a determination on which party was entitled to beneficial ownership.

Ultimately, the Court concluded that the reasons given by the panel to justify its award were so inadequate and inconsistent - bearing in mind the significance of the decision and evidence provided - that they fell short of discharging the panel's mandate to make a reasoned award. In reality, the panel had simply elected to adopt a convenient compromise, or an "irrational splitting of the difference", which was not the result of any coherent or logical process.

The appeal was therefore allowed, and the Court set aside the panel's award.

To read a copy of the decision, click here.

Franco Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel

The second case, Franco Belgiorno-Nettis v Auckland Unitary Plan Independent Hearings Panel [2017] NZHC 2387, involved a challenge to a report of the Independent Hearings Panel established to make recommendations to the Auckland Council on the development of the Auckland Unitary Plan.

The appellant in the proceeding was one of the thousands of people who made submissions to the Panel on the proposed Plan. He challenged the Panel's recommendations in its final report (and the Council's decision to adopt those recommendations) on the basis that the Panel and the Council failed to provide reasons for accepting or rejecting his submissions.

The High Court decision

In dismissing the challenge, the High Court looked at the statutory context, and found that the relevant legislation imported a clear obligation on the part of the Panel to give reasons for accepting or rejecting submissions on the proposed Plan. The Court then looked at what was required to discharge that obligation. Although noting that there are "no uniform requirements that applying in all situations", the Court considered that the extent and depth of the reasoning required in any particular case may vary having regard to:

  • the function and role of the decision maker;
  • the significance of the decision made upon the person or parties affected by the decision;
  • the rights of appeal available; and
  • the context and time available to make a decision.

Here, the Panel was not required to address each submission individually, but rather address submissions to a level of detail that was "appropriate" to explain its reasons in relation to topics within which issues and matters raised in the submissions were grouped. With this in mind, the Court concluded that any "reasonably informed" reader of the Panel's report would have no difficulty identifying and understanding the Panel's reasons for its recommendations - albeit expressed in general terms.

To read a copy of the decision, click here.

What should statutory decision-makers take from these decisions?

New Zealand law has long recognised that the nature and extent of the duty on public and statutory decision-makers to give reasons depends on the particular decision and context in which it is made.

However, in both decisions the Courts expressly acknowledged, as previous courts have done, that the giving of reasons is one of the fundamentals of good administration. Broadly, it is a check on arbitrary or erroneous decision-making, it assures affected parties that their evidence and arguments have been assessed in accordance with the law, and it provides a basis for scrutiny by an appellate court.

The decisions are a timely reminder for public and statutory decision-makers of many kinds of the importance of recording decisions in a manner that clearly and adequately explains what was decided and - just as importantly - why.

Where this is not done, there is a danger that a person adversely affected might conclude that they have been treated unfairly by the decision-maker and there may be a basis for a successful challenge in the courts.