Tuuta v Ngati Mutunga O Wharekauri Iwi Trust

• Jurisdiction: New Zealand
• Judge: Panckhurst J
• Judgment Date: 15 July 2014
• Neutral Citation: [2014] NZHC 1666
• Docket Number: CIV-2013-485-006268
• Court: High Court
• Date: 15 July 2014

BETWEEN

Charles Edward Tuuta

Plaintiff

and

Ngati Mutunga O Wharekauri Iwi Trust

Defendant

[2014] NZHC 1666

CIV-2013-485-006268

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

Application for declarations as to whether, in terms of the trust deed of the defendant Iwi Trust, a conflict of interest should be addressed prior to or after the election — the plaintiff sought guidance in respect of future elections rather than a ruling in respect of a past election — plaintiff was a member of Ngati Mutunga, the iwi of Wharekauri (the Chatham Islands) — plaintiff's nomination for election as a trustee of the Iwi Trust was rejected on the grounds that he had an irreconcilable conflict of interest, as he served on an interim executive committee which was competing with the Iwi Trust in seeking the mandate to represent Ngati Mutunga — the Iwi Trust was awaiting final sign off from the Office of Treaty Settlements as the entity mandated to represent the iwi for Treaty of Waitangi settlement purposes — whether a conflict of interest could be addressed prior to an election — whether there was any utility in granting relief where the nomination form might be altered for a future election to address the situation which had arisen in this case.

Appearances:

M S Smith for the Plaintiff

J V Ormsby and G J C Carter for the Defendant

JUDGMENT OF Panckhurst J

The issues

1 Ngati Mutunga are the iwi of Wharekauri (the Chatham Islands). The defendant, Ngati Mutunga o Wharekauri Iwi Trust (the Iwi Trust), is awaiting final sign off from the Office of Treaty Settlements as the entity mandated to represent the iwi for Treaty of Waitangi settlement purposes. Who should be the mandated representative has been a contentious issue for some years. It forms the essential background to this proceeding.

2 However, the more immediate background is an endeavour by the plaintiff, Charles Tuuta, a member of the iwi, to seek election as a trustee of the Iwi Trust. In November 2012 he was nominated for election as a trustee. The following month Mr Tuuta's nomination was rejected by the then-trustees on the grounds that his election would give rise to an irreconcilable conflict of interest. Mr Tuuta is on the interim executive committee of Te Runanga o Wharekauri Rekohu Incorporated Society (Te Runanga). Te Runanga is considered to be in competition with the Iwi Trust in seeking the mandate to represent Ngati Mutunga. This is said to give rise to the irreconcilable conflict of interest.

3 Mr Tuuta seeks two declarations. These are borne of the rejection of his nomination in 2012, but the declarations do not challenge that decision. Rather, they are forward looking, since Mr Tuuta proposes to seek election to the Iwi Trust Board at forthcoming elections. The declarations sought raise two issues:

• (a) Whether in terms of the Trust Deed of the Iwi Trust a conflict of interest may be addressed prior to the election, or only after the election. Mr Tuuta contends that a pre-emptive rejection of a nomination before voting is impermissible, whereas the trustees of the Iwi Trust consider that early rejection of a nomination is appropriate, at least in the case of an irreconcilable conflict of interest.

• (b) What process does the Trust Deed of the Iwi Trust require the trustees to follow in considering whether a trustee has a conflict of interest which prevents him/her from holding office?

4 The proceeding invokes both the Declaratory Judgments Act 1908 and the equitable jurisdiction of this Court under Part 18 of the High Court Rules. The parties are also at odds concerning whether the claimed relief is appropriate, given the factual and other circumstances of the case.

Some further background

5 For present purposes it is not necessary to delve into the recent history of the contest for the Ngati Mutunga mandate in any detail. In the late 1980s the Maori Fisheries Commission was established with the intention that quota would be allocated to iwi throughout the country. Te Runanga was incorporated in 1988 as the entity to receive quota on behalf of Ngati Mutunga. In due course quota were made available, and Te Runanga set about managing the asset for the benefit of the iwi.

6 In March 1994, however, a rival entity was incorporated, the Ngati Mutunga o Wharekauri Incorporated Society (the Society). Representation of the iwi in relation to a Treaty of Waitangi settlement became a bone of contention, with Te Runanga and the Society each seeking the mandate. The matter was further complicated when in October 1999 the Ngati Mutunga o Wharekauri Trust (the Original Trust) was incorporated under the Charitable Trust Act 1957 to be the iwi's mandated representative. But, dissention continued.

7 In an endeavour to resolve the conflict an Agreement of Intent was signed on 12 September 2003. Te Runanga and the Original Trust were the parties to the agreement. The opening recitals stated:

Whereas The Ohu Kai Moana criteria requires a single Ngati Mutunga entity as the iwi representative body for Chatham Island Ngati Mutunga.

And

Whereas [Te] Runanga and [the Original Trust] agree that a single Ngati Mutunga o Wharekauri organisation should be set up to replace the existing entities within a six month period.

8 The terms of agreement provided that the executive body of the new entity would have an establishment membership drawn equally from Te Runanga and the Original Trust, and that during the transition period this body would establish the new entity structured in a manner to manage commercial, non-commercial and political issues, as well as claims issues. At the end of the six month transition period it was agreed there would be a hui for the election of an executive “for the formalised Iwi entity” 1 and to replace the establishment executive. A further duty of the establishment executive was: 2

To ensure the immediate needs of existing entities are finalised and terminated.

9 The agreement led to the establishment of the defendant, the Iwi Trust, under a deed of trust dated 28 September 2004. Consistent with the terms of the Agreement of Intent, the Society and the Original Trust passed resolutions that they be placed in voluntary liquidation. Earlier, the assets of the Society had already been

transferred to the Original Trust. Liquidators were appointed and, despite difficulties as a result of claims made against assets held by the Original Trust, the liquidators eventually obtained an order for distribution of the surplus assets to the Iwi Trust. Hence, as contemplated in the Agreement of Intent, the Original Trust was “terminated”

10 By contrast, Te Runanga began, but ultimately did not sign off on a decision to wind up its affairs and distribute its assets. Instead Te Runanga continued in existence, but seemingly did not comply with its obligations as an incorporated society. In 2008 Mr Tuuta's sister, Evelyn Tuuta, filed a judicial review proceeding in which she sought the appointment of the Maori Trustee to effectively restore the Society to a state of effective administration.

11 The application for judicial review was resolved by the making of consent orders on 1 April 2009. 3 The first order was in the nature of a reference back to Te Runanga of the concerns raised in Ms Tuuta's statement of claim, so that the Society could consider the concerns and “determine the steps to be taken to place [Te Runanga] in compliance with its Rules at the earliest practical time”. Further orders appointed the Maori Trustee to assist with this process, and directed the provision of a report by the Maori Trustee to a retired Judge of the Maori Land Court, Judge Hingston, who was appointed to chair a committee of Te Runanga until such time as a new executive committee could be elected.

12 The evidence as to the current situation of Te Runanga is somewhat sparse. Mr Tuuta deposed that the High Court orders made in April 2009 remain in effect. He explained that an interim Te Runanga committee was established and that he has remained a member of that committee to the present time. Mr Tuuta's affidavit also refers to concerns that he holds about the way the Iwi Trust has functioned and confirms that he will again seek election as a trustee because he considers he can contribute to such concerns being addressed. The affidavit evidence does not explain why Te Runanga has not been wound up, nor does it clarify whether it still seeks the mandate to represent the iwi.

When may a conflict of interest be addressed under the trust deed?

The factual background

13 Mr Tuuta was born and raised in the Chatham Islands. He is registered as an adult beneficiary of the Iwi Trust. In November 2012 Mr Tuuta sought election as a trustee of the Iwi Trust to represent beneficiaries ordinarily resident in the North Island. Mr Tuuta has resided in the Wellington area for many years. Two of the seven trustees must be persons ordinarily resident in the South Island and the North Island as representatives of these areas.

14 Mr Ward Kamo, the trust secretary of the Iwi Trust, swore an affidavit in which he explained the trustees' concerns regarding Mr Tuuta's nomination. He referred to the governance issues of Te Runanga, but also to the specific concerns that Te Runanga has continued to use iwi fishing quota for its own purposes and that it continues to seek the mandate to represent Ngati Mutunga in competition with the Iwi Trust. This last concern, in particular, is considered to give rise to an irreconcilable conflict of interest.

15 In March 2012 the trustees of the Iwi Trust resolved to remove a trustee on the grounds that her conduct had brought the name of the Iwi Trust into disrepute. While the decision was taken with reference to a number of issues, a central concern was that she was centrally involved in the formation of another trust which was to seek the mandate to represent Ngati Mutunga. ...