Mita Michael Ririnui v Landcorp Farming Ltd

• Jurisdiction: New Zealand
• Judge: Elias CJ,Arnold J,Glazebrook J,O'Regan J,William Young J
• Judgment Date: 09 June 2016
• Neutral Citation: [2016] NZSC 62
• Docket Number: SC 47/2015
• Court: Supreme Court
• Date: 09 June 2016

Between

Mita Michael Ririnui

Appellant

and

Landcorp Farming Limited

First Respondent

The Attorney-General

Second Respondent

and

Wheyland Farms Limited

Interested Party

[2016] NZSC 62

Court:

Elias CJ, William Young, Glazebrook, Arnold and O'Regan JJ

SC 47/2015

IN THE SUPREME COURT OF NEW ZEALAND

Appeal from a Court of Appeal (CA) decision which held that while the advice given by Office of Treaty Settlements (OTS) under the protocol was wrong in law, it was not reviewable and that neither the shareholding Ministers nor the Minister for Treaty of Waitangi Negotiations had the power to intervene to prevent the sale of Whārere farm. The CA decision also dismissed a bad faith claim — OTS had informed the respondent that farmland was not required to settle any historical Treaty of Waitangi claims — Ngāti Whakahemo claimed mana whenua over the land and sought an order setting aside the agreement for sale and purchase — whether the CA had been correct to refuse the relief sought by the appellant on the basis of the respondent's alleged bad faith, the acknowledged error of law by the OTS in its advice to the respondent and/or the failure of the shareholding Ministers of the respondent to intervene — whether the respondent's entry into the agreement for sale and purchase was tainted by bad faith — whether the shareholding Ministers' decision not to give the undertaking sought by Ngāti Whakahemo or to take other steps to protect Ngāti Whakahemo's interests breached s9 State-Owned Enterprises Act 1986 (Treaty of Waitangi) and was based on the erroneous view that they had no power to intervene — whether the advice of OTS was erroneous and had materially affected all consequent decisions of the respondent and the shareholding Ministers.

Counsel:

M T Scholtens QC, A N Isac and J B Orpin for Appellant

J E Hodder QC, B Gnanalingam, B J Maltby and, on 19 August 2015, S A Barker for First Respondent

D J Goddard QC, J R Gough and S J Humphrey for Second Respondent

A A Hopkinson for Interested Party

A The appeal is allowed in part.

B The following declarations are made:

(i) The decision of Landcorp Farming Limited's shareholding Ministers and the Minister for Treaty of Waitangi Negotiations not to intervene in the tender process on behalf of Ngāti Whakahemo as they did on behalf of Ngāti Makino was a wrongful exercise of a public power because it was made under a material mistake.

(ii) The decision by Landcorp Farming Limited on 28 February 2014 to sell Whārere farm to Micro Farms Limited was a wrongful exercise of a public power because it was made under a material mistake.

C All other forms of relief claimed by the appellant are declined.

D The restraining order made by this Court in Order C of its judgment granting leave to appeal ( Ririnui v Landcorp Farming Ltd [2015] NZSC 72) is discharged.

E Costs are reserved. The parties may file written submissions as to costs in this Court and in the Courts below if they are unable to reach agreement.

JUDGMENT OF THE COURT

REASONS

Elias CJ and Arnold J	[1]
Glazebrook J	[147]
O'Regan J	[150]
William Young J	[193]

Elias CJ AND Arnold J

(Given by Arnold J)

Table of Contents

	Para No
Introduction	[1]
Factual background	[4]
Facts primarily relevant to the error of law grounds	[5]
Facts primarily relevant to the bad faith ground	[27]
The sale and purchase agreement: cls 21 and 22	[33]
The proceedings	[35]
Issues in this Court	[39]
Evaluation	[42]
The context: land sales by Landcorp	[43]
The Crown's error	[53]
The decisions and/or powers at issue	[56]
The reviewability of Landcorp's decision to sell Whārere to Micro	[64]
Decisions of Ministers	[77]
March 2014 decision	[78]
December 2013 decision	[83]
Drawing the threads together	[98]
The bad faith claim	[100]
Relief	[110]
Section 21	[114]
An agreement has been concluded	[118]
Third party prejudice	[131]
Overall assessment	[138]
Result	[143]

Introduction

1 This is a judicial review case. Judicial review is a supervisory jurisdiction which enables the courts to ensure that public powers are exercised lawfully. In principle, all exercises of public power are reviewable, whether the relevant power is derived from statute, the prerogative or any other source. The courts acknowledge limits, however. These limits are reflected primarily in the notions that the case must involve the exercise of a public power, that even if the court has jurisdiction, the exercise of power must be one that is appropriate for review and that relief is, in any event, discretionary. It is the scope of these limits that is at issue in the present case.

2 The appellant, Mita Ririnui, is the Chairman of the Ngāti Whakahemo Claims Committee and Te Runanga o Ngāti Whakahemo. He brought judicial review proceedings on behalf of Ngāti Whakahemo in an attempt to halt the sale of a farm property, Whārere, over which Ngāti Whakahemo claim mana whenua. The respondent, Landcorp Farming Ltd (Landcorp), a state-owned enterprise, was the vendor and the interested party, Wheyland Farms Ltd (Wheyland), was the purchaser (by nomination).

3 In this Court, the principal relief sought by Ngāti Whakahemo seek an order setting aside the agreement for sale and purchase. By way of background to the description of the factual and other context which follows, their contentions may be summarised as follows:

• (a) First, the agreement was tainted by bad faith on Landcorp's part. Were it not for Landcorp's bad faith, Ngāti Whakahemo would have issued these proceedings before the agreement had been concluded and sought an interim injunction to prevent any sale prior to their resolution.

• (b) Second, Landcorp was labouring under an error of law as to Ngāti Whakahemo's status at all relevant times. But for that error, Landcorp would not have entered the agreement in the way that it did.

• (c) Third, the shareholding Ministers refused to intervene in the sale process both because they wrongly thought they had no ability to intervene and also because they were labouring under the same error as Landcorp as to Ngāti Whakahemo's status.

Factual background

4 For ease of presentation, we will divide the description of the factual background into two segments – the facts primarily relevant to the bad faith ground and those primarily relevant to the error of law grounds (although there is, of course, no rigid line between the two). In terms of the narrative, the facts relevant to the error of law grounds come first in time, and those relevant to the bad faith ground second.

Facts primarily relevant to the error of law grounds

5 Landcorp is a state-owned enterprise governed by the State-Owned Enterprises Act 1986 (the SOE Act). Its shareholding ministers are the Minister of Finance and the Minister for State-Owned Enterprises. It owns a large amount of farm land, much of which was, before Landcorp's incorporation, in Crown ownership and is now subject to the memorial regime in the SOE Act. 1 In 2013 Landcorp owned a large block of land in the Bay of Plenty known as Whārere, on which there were five dairy farms. 2 Whārere, which comprises 404 ha on one title, had been acquired by the Crown between 1880 and 1912. It is subject to a memorial under s 27B of the SOE Act.

6 In 2013, Landcorp decided to investigate the sale of Whārere as, although profitable for dairy farming, it was no longer a ready fit with Landcorp's other operations due to its isolation and because its facilities needed some upgrading. In August 2013, before it had embarked on any sale process, Landcorp advised the Office of Treaty Settlements (OTS) that it was investigating the sale of Whārere and asked whether the property was potentially of interest to the Crown for Treaty of Waitangi settlement purposes. Landcorp took these steps in accordance with a protocol which it had agreed with OTS in April 2012 (the Protocol). This Protocol, which is described in its preamble as “not legally binding”, established a process by which Landcorp would give early warning of proposed land sales so that the Crown could consider whether the land was of interest to it for settlement purposes; where land was of interest, the Protocol set out a process by which the Crown would purchase it in order to “land bank” it. 3

7 To step back in the narrative for a moment, in February 2008 Ngāti Whakahemo filed a claim, Wai 1471, in the Waitangi Tribunal in respect of an area

of land which includes Whārere. 4 According to Mr Ririnui, Whārere is part of the ancestral lands of Ngāti Whakahemo, part of their papakainga (home). In a letter dated 29 May 2012 responding to an enquiry from Ngāti Whakahemo about Wai 1471, OTS expressed the view that all Ngāti Whakahemo's historical claims had been settled:

The historical claims of Ngāti Whakahemo (including Wai 1471) have been settled through the Affiliate Te Arawa Iwi and Hapu Deed of Settlement which was signed on 2 June 2008. Ngāti Whakahemo is listed as a hapu of Ngāti Pikiao in the Claimant Definition of the Affiliate Te Arawa Iwi and Hapu Deed of Settlement.

A year later, on 16 May 2013, Ngāti Whakahemo's solicitors wrote challenging the OTS view. They provided a detailed explanation in support of their contention that Ngāti Whakahemo's historical claims had not been settled, the essential point being that the claims derived from an ancestor not covered by the settlement deed, namely Maruahaira. OTS responded by letter on 28 May 2013 maintaining its view, which prompted Ngāti Whakahemo's solicitors to write to the Minister for Treaty of Waitangi Negotiations, the Hon Christopher Finlayson QC, on 17 June 2013 drawing his attention to the dispute and summarising the basis for the contention that Ngāti Whakahemo's...