National Urban Māori Authority v Te Ohu Kai Moana Tr ustee Limited [2016] NZHC 1600 (15 July 2016)

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UNDER	the Judicature Amendment Act 1972
BETWEEN	NATIONAL URBAN MĀORI AUTHORITY First Plaintiff
AND	TE WHĀNAU O WAIPAREIRA TRUST Second Plaintiff
AND	TE OHU KAI MOANA TRUSTEE LIMITED Defendant
AND	RIKIRANGI GAGE AND RICHARD CHARLES TAUEHE JEFFERIES _{Interested Parties}

Hearing:	20-21 April 2016
Counsel:	B D Gray QC and J P Orpin for Plaintiffs P J Radich QC, J P Ferguson, S P Karipa and K J Tarawhiti for Defendant
_Judgment:	_{15 July 2016}

NATIONAL URBAN MĀORI AUTHORITY & OR v TE OHU KAI MOANA TRUSTEE LTD & ORS [2016]

[1] In 1986 the government of the day introduced a quota management system for fisheries. That led to a protracted process of litigation and negotiation with Māori. The culmination was the Treaty of Waitangi Fisheries Settlement. An aspect of the implementation of that settlement was the Māori Fisheries Act 2004 (the Act).

[2] One issue throughout the settlement process was how, if at all, settlement proceeds would reach those who are sometimes collectively called urban Māori. It is common ground in this litigation, and realistically beyond any doubt, that one of the mechanisms settled upon to meet this need was the allocation of a portion of the settlement monies to a specific Trust - Te Putea Whakatapu Trust (Te Putea Trust).

[3] The Trust is required to be established by the Act, which also mandates the creation of a corporate Trustee of the same name - Te Putea Whakatapu Trustee Ltd (Te Putea Trustee). The purposes of Te Putea Trust are set out in s 81, and the functions of Te Putea Trustee in s 83. The Act also contains directions concerning the constitution of Te Putea Trustee, and the number of directors (three).

[4] Section 88 of the Act concerns the qualifications of the directors and its meaning is the first matter in dispute in these proceedings. Section 88(2) states:

(2) In appointing the directors of Te Putea Whakatupu Trustee Limited, Te Ohu Kai Moana Trustee Limited must consult with the National Urban Māori Authority in order to ensure that the directors have knowledge of, and are able to represent, the interests of Māori who reside in urban areas of New Zealand.

[5] The Court is asked to determine whether the criteria identified in that subsection are an attribute each director must have, or alternatively an attribute the board of directors collectively must have.

[6] The Trust is one of a number of similar entities established by the Act. Each has a specific role in implementing different parts of the settlement. The Act required that all these entities be reviewed after 10 years. In general terms the

purpose of the Review is to assess whether the entity is still needed, and if so, whether its structure is working or could be improved upon.

[7] The Review has taken place. The statutory scheme requires that the Review Report be submitted to nominated groups for consideration, at the conclusion of which mandated iwi organisations are empowered to make resolutions adopting or amending the recommendations of the Review.

[8] That is where matters have reached. Iwi have made resolutions in relation to Te Putea Trustee. The resolutions do not adopt the recommendations of the Review. The plaintiff organisations, who as their name suggests are groups concerned with the interests of urban Māori, challenge the process that has been followed since the Review Report was completed. They allege that it does not comply with the statutory scheme or with natural justice. Orders are sought quashing the resolutions that affect Te Putea Trustee.

[9] The plaintiffs are organisations concerned with the interests of Māori living in urban areas.

[10] The National Māori Urban Authority (NUMA) was established in 2003. Its purpose was to provide a formal umbrella for the collective efforts of the many urban Māori organisations that existed within New Zealand. The evidence describes NUMA in this way:

NUMA’s role is to support and co-ordinate the work of its affiliates by bringing them together as a cohesive national collective. In doing so NUMA’s objectives are to further the sustainable development and coordination of urban Māori authorities so that better outcomes for whanau are achieved.

[11] The role of NUMA is recognised in the Act. Pursuant to s 88(2) it must be consulted in relation to the appointment of the directors of Te Putea Trustee.

[12] Te Whānau o Waipareira Trust (Waipareira Trust) was formally incorporated in August 1984 but had existed for some time prior to formal incorporation. Its focus is Māori living in the West Auckland area. It provides health, welfare, justice, education and enterprise services. To achieve this it employs 200 full time staff and has a large number of accredited volunteers.

[13] Te Ohu Kai Moana Trustee Ltd (TOKM) is the corporate trustee of the trust of the same name. The Act directed TOKM to be established. TOKM was allocated the role and functions of the former Treaty of Waitangi Fisheries Commission. It is the central governing entity which has administrative, governance and policy roles.

[14] In relation to this proceeding, TOKM appoints the directors of Te Putea Trustee. It is therefore the entity said to have misinterpreted and misapplied its appointment powers. It also has a dual role in relation to the review process. First, it is one of the entities to be reviewed. Second, it performs various administrative and co-ordination roles in relation to the Review once received. It instituted and co- ordinated the process that is said to be flawed. The resolutions that are passed by the mandated iwi organisations occur as part of a general meeting of TOKM.

[15] The interested parties were two of the current directors of Te Putea Trustee. By the time of the hearing they had resigned, and took no role in the proceeding.

[16] The respondent submits that the Court’s task is one of orthodox statutory interpretation. Recourse to the history of the settlement negotiations and the genesis of the Putea is accordingly submitted to be of marginal relevance. I do not agree, and I accept the plaintiffs’ position that it is an important context in relation to both issues in dispute. Accordingly I now set out in some detail how what I will call te putea came to exist, and what its purposes are.

[17] As noted, there was dispute during the settlement process about who should benefit from settlement proceeds. One aspect of that debate was the extent to which urban Māori¹should receive benefits, and how that was to be done. In the end it was agreed that a $20,000,000 fund would be allocated - te putea.

[18] The method and rules governing distribution of te putea to its target group underwent changes. As these occurred, there were two significant judgments which considered challenges to the proposals. The first was Manukau Urban Māori Authority and Ors v Treaty of Waitangi Fisheries and Ors.²The second decision is Thompson v Treaty of Waitangi Fisheries Commission.³This was an appeal from the Manukau Urban Māori Authority decision. However, by the time it was heard

the proposal had changed, and accordingly not all of the High Court decision remained in issue.

[19] Before highlighting crucial aspects of those judgments, it is necessary to observe they occurred against the backdrop of other important decisions on different aspects of the settlement. These cases are extensively reviewed in Thompson.⁴They established that the Deed of Settlement and the settlement Act⁵required the proceeds of the settlement to be distributed only to traditional iwi. However, it was also

confirmed that the benefit of the settlement was to be for all Māori, not just traditional iwi. In Manukau Urban Māori Authority, the combined effect of these two propositions was put in this way:⁶

... the settlement is ultimately for the benefit of all Māori, but iwi are the required vehicle.

¹Urban Māori is the term used by the plaintiffs to describe their constituency. The respondents note it is not a term used in the Act, and argue the Act’s words should be the focus. It is not an argument with which I have sympathy, but I simply note for the record I use “urban Māori” because the plaintiffs have. It generally describes Māori who live in urban areas outside the boundaries of their ancestral iwi’s traditional rohe. For the purposes of this litigation, the focus is on those urban Māori who do not have any active relationship with or connection to their iwi.

²_{Manukau Urban Māori Authority and Drs v
Treaty of Waitangi Fisheries and Ors HC Auckland}

The allocation must be to iwi but on the condition that iwi have put in place structures, both tribal and pan-tribal, which will ultimately enable delivery of benefits to all Māori.

It is against that background and the need to ensure settlement assets reached beyond iwi that te putea was established.

[21] Manukau Urban Māori Authority involved a challenge to the structure proposed for te putea by the Treaty of Waitangi Fisheries Commission in its report He Kawai Amokura. The Commission had proposed that Te Putea Trust income could only be used to fund education, training programmes and opportunities in relation to “fishing and the fishing industry”. McGechan J held this to be an unreasonable limit (in the administrative law sense), since the assets being distributed to iwi were not similarly tagged. Other issues addressed included a challenge to the adequacy of te putea allocation, and a challenge to the review mechanism.

[22] Some passages from McGechan J’s judgment help confirm the context for the establishment of te putea. First:⁸

The Putea was conceived as a mechanism which would reduce the risk Māori who did not know their iwi, or did not have strong connections to iwi, might be excluded:

Urban Māori are entitled to ultimate benefit of settlement assets as part of all Māori. It is not mere aroha. Iwi unable or unwilling to make effective provision through iwi mechanisms must see it is done in other ways. The Putea is that way.

⁷Te Waka Hi Ika o Te Arawa v Treaty of Waitangi Fisheries Commission [1999] NZCA 232; [2000] 1 NZLR 285 at

The Commission proposed a Putea (a trust). While it was a concept which evolved over time, it gained and carried immediate support amongst iwi. I am not surprised. There are obvious difficulties in some special regime under which iwi, following receipt of allocation, somehow are to see to movement of benefits to members who do not know their iwi, or who cannot practicably connect with it. I regard that iwi support as evidence, in its own way, that a Putea concept was the best of a number of possible approaches, all necessarily somewhat imperfect.

[23] Similar statements to these can be found in Thompson. Reinforcement of the points is worthwhile for this case. When summarising the rationale for te putea, the Court of Appeal emphasised these aspects of the Commission’s reasoning:

[58] The commission recognises in He Kawai Amokura that, both in relation to PRESA and POSA,¹¹it has an obligation to ensure that the settlement is ultimately for the benefit of all Māori and that, if it does not believe that this can be achieved, then it cannot reasonably promote its proposal for allocation. The Commission is, however, satisfied that its model achieves that object. It considers that the Putea is a further mechanism to ensure that this requirement is met for PRESA. It says that it will reduce the risk that Māori who do not know the identity of their iwi or who do not have strong connections to their iwi could be excluded from accessing the benefits of the settlement.

[59] The Commission says that it chose the Putea model because it would have been unfair to expect iwi generally, and in particular iwi with a large unaffiliated Māori population domiciled in their rohe, to apportion part of their allocation for access to those Māori who do not affiliate. This would create disparities depending on the location of particular iwi (see p 88, para E161). Iwi obviously agreed with this as, in its consultation process, the Commission achieved an

89.66 per cent level of support from recognised iwi for the Putea. (citations omitted)

[170] The decision to persist with the Putea is understandable as it had been decided that it would not be appropriate to require iwi to be responsible for distributing benefits to other than iwi members (see the discussion at paras [59], [71] and [72] above). McGeehan J

¹⁰Reference could also be made to the statement at [128] that the basic object of Te Putea is to discharge the duty to ensure the settlement is for the benefit of all Māori, and to see fairness among Māori.

considered such a decision unsurprising and pointed to the obvious difficulties there would be in a regime that made iwi responsible for other than members (see para [124] of his judgment, quoted at para [98] above). We agree. Indeed, Mr Thompson supports the Putea structure in principle.

[192] We also consider that iwi control over the Putea is not unreasonable in light of the necessity that assets be allocated to iwi. It is a mechanism by which iwi can fulfil their obligation of ensuring that the settlement is ultimately for the benefit of all Māori. Any control must, however, be exercised for that purpose and that should, in our view, be made absolutely clear.

[25] Finally, from this review of the authorities, reference can be made to a further issue about te putea that was addressed in the litigation. Complaint was made that the draft legislation did not make it sufficiently clear that te putea was for the benefit of urban Māori. At the time McGechan J considered this issue, the wording was as it appeared in a draft Bill attached to the Fisheries Commission Report:

... with a commitment to ensure that benefits are made available as widely as possible to Māori having regard to the extent to which iwi are promoting or able to promote those purposes.

[37] It is unfortunately opaque drafting. It would have been a great deal better to state the intended preference as such and in clear and separate terms. However, when closely studied its meaning emerges.

[38] It is best to start at the end and work backwards. On that approach the Commission examines the extent to which iwi are promoting the relevant fisheries related purposes, or are able to do so. That area of promotion or ability is debited against iwi Putea access. Benefits are then to be made available as widely as possible to other Māori over the remaining area, including urban Māori. It does afford some preference, along with iwi without capacity. That intention is reinforced when reference is made to paragraph 170 of the report, as a court on modern interpretative approaches would. I have little doubt that intention would be implemented, with preference afforded.

[39] It is clumsily done, but it cannot be said there was error in law through failure to provide for different weighting for urban Māori.

[27] By the time the Court of Appeal addressed the same complaint, the Commission’s draft Bill had been introduced into Parliament, but in an amended form. The relevant wording was the same as now appears in s 82 of the Act:

The benefits of The Putea Whakatupu Trust must be made available as widely as possible to all Māori, having regard to–

(a) the extent to which mandated iwi organisations are providing, or are able to provide, benefits for members of their iwi that are the same or similar to those that are able to be provided by Te Putea Whakatupu Trustee Limited; and

The wording in the Bill currently before the Select Committee, while more favourable to urban Māori, still does not give them absolute priority.

[29] I conclude this review of the history of te putea with some observations of my own which pick up on aspects of the argument presented to me. It is important to not lose sight of the role te putea played in the settlement. In my view the submissions of the respondent placed too great an emphasis on the proposition that the settlement was for the benefit of all Māori, and that te putea was open to all Māori. Through that, and through the absence of any provision according absolute priority, there seems to have developed an approach that does not accord urban Māori the preference that was intended.

[30] It is correct to say, as the Court of Appeal did, that the preference is not absolute. It is also correct to say the settlement was for all Māori, and that all Māori are entitled to access te putea. But those responsible for administering te putea must remember that te putea was the method by which the duty to ensure the settlement

_{reached those who cannot or do not affiliate with iwi was to be
discharged. It also}

served the purpose of lifting from iwi the responsibility for conferring benefit on non-iwi living in the iwi’s rohe.

[31] Te putea is not itself to be seen as existing to meet all purposes and obligations of the settlement. Its very reason for existence is to meet the need of a particular group who would not otherwise benefit. It is a specific part of the solution. McGechan J rejected a challenge to the structure only because he considered the proposed legislation, correctly interpreted, established that clear priority. Then, the Court of Appeal observed that the current wording made the priority interpretation reached by McGechan J even clearer. That Court also observed that whilst iwi control of te putea was reasonable, it should be clear that control was to be exercised for achieving the purposes of te putea. This obligation has not changed since then.

[32] The extended discussion of the history of te putea allows a shorter exposition of the statutory provisions. The Trust is established by s 78. Its purpose, in s 81, is to hold the funds:

In order to promote education, training and research, including matters that relate to fisheries, fishing and fisheries-related activities ...

[33] It can be seen, reflecting McGechan J’s ruling, that whilst fishing-related purposes is still mentioned, the expenditure of the funds is not limited to that.

[34] Section 82 has already been cited above at [27]. It is the key provision which reflects the origins of Te Putea Trust. Properly interpreted, as both the High Court and Court of Appeal have previously held, it makes clear that significant priority is to be given to those identified in para (b) of s 82, namely Māori who do not associate with their iwi or who do not receive assistance from a mandated iwi organisation.

[35] Section 80 required the establishment of the corporate Trustee, and s 83 sets out its functions. Section 84 identifies matters that must be included in Te Putea Trust Deed, and then there are prescribed obligations to have an annual plan, to report to TOKM, and to follow proper accounting and auditing practices.

[36] Section 88 concerns the appointment of directors and it is convenient to set it out in whole:

(1) The constitution of Te Putea Whakatupu Trustee Limited must specify that the directors of Te Putea Whakatupu Trustee Limited must all be Māori who, collectively,–

(2) In appointing the directors of Te Putea Whakatupu Trustee Limited, Te Ohu Kai Moana Trustee Limited must consult with the National Urban Māori Authority in order to ensure that the directors have knowledge of, and are able to represent, the interests of Māori who reside in urban areas of New Zealand.

(3) Subsection (2) does not limit the power of Te Ohu Kai Moana Trustee Limited to consider the views of any other person or organisation that it considers has knowledge that is relevant to the interests of Māori who live in urban areas.

[37] The issue is whether s 88(2) requires that each director have knowledge of, and be able to represent, the interests of Māori who reside in urban areas, or whether it merely requires that the directors as a group have this capacity. Each party suggested the other’s interpretation required the reading in of words not in the section. The reality is that one can always redraft these things to make the meaning plain. The meaning is presently in dispute, and ultimately any interpretation the Court reaches will have the effect of adding words to make the meaning clearer.

[38] Looking first at the words of s 88(2) itself, in its written submissions TOKM first submitted it did not add a further criterion that the directors either individually or collectively needed to have. Rather, s 88(2) was merely a consultation provision, and the reference to familiarity with urban Māori was only to give context to the consultation. I understand TOKM did not maintain this position at the hearing, but if incorrect in that understanding, it is in my view plain that s 88(2) prescribes an attribute that at least the board of directors as a whole must have.

[39] Section 88(2) uses the term “ensure”. That is a strong word which makes it plain the attributes are not merely aspirational. Equally the history of te putea demands such a reading. The s 88(1) criteria do not contain any matter that specifically relates to urban Māori. Section 88(2) therefore performs a key function in the scheme. It is the means by which the purposes of Te Putea Trust as set out in s 82 are reflected in the make-up of the directors. It cannot be read down so as to relegate the urban Māori dimension to mere consultation in the way TOKM’s submission would. To do so would be to manifest the very risk discussed earlier: that the reference in s 82 to te putea being available to all Māori is given too much emphasis at the expense of the proper focus established by the balance of s 82. Accordingly, I view s 88(2) as establishing attributes that must be present among the cohort of directors.

[40] Returning then to the “each” director or “directors as a whole” issue, the expression “the directors” in s 88(2) could mean either. If one looks, for example, at s 84, the expression is used in circumstances where it must be referring to each director individually (s 84(1)(a) which deals with pay) but also where it can only be referring to the group as a collective (s 84(1)(e) which requires the directors to commission an audit). The inconsistent use of the term in s 84 suggests little weight can be placed on its natural meaning.

[41] TOKM’s position is that if it is a criterion, it should be seen as an extension of s 88(1). In other words, as another of the attributes that must be collectively held. It is submitted that this attribute needed to be placed in a separate subsection because it came with an extra consultation requirement. However, if that were so, it is not clear why the criterion needed to be removed from the s 88(1) list. Section 88(2) could easily just impose a consultation requirement by referencing back to the criterion as it appeared in s 88(1).

[42] It is clear from looking at surrounding sections that the drafter has focused on this issue of whether attributes are to be collectively held or must be something each director has. There are two specific examples of this. Section 88(1) is itself an example because within its terms it identifies both an individual attribute that each director must have (being Māori) and then collective attributes. Likewise, s 101 sets

out a list of attributes that directors of another trustee must hold “collectively”. It states:

The constitution of Te Wai Maori Trustee Limited must specify that the directors of Te Wai Maori Trustee Limited must all be Maori who, collectively,—

(d) have expertise and experience in matters relevant to freshwater fisheries; and

[43] Sections 88(1) and 101 are similar in their drafting. They each first require all directors to be Māori, then to collectively hold other characteristics. The first two collective characteristics are general, and the same for both sets of directors – being well versed in tikanga Māori and having experience working with Māori and Māori organisations. These are followed by requisite collective characteristics relevant to the trust at hand: for Te Putea Trust, expertise in human resource development, education and training, for Te Wai Māori trustee, various expertise and experience related to fisheries.

[44] Given this awareness of the drafter to the issue, it is an orthodox approach to see it as significant that this s 88(2) criterion sits outside the list of collective attributes. If it was just another matter the directors as a whole should have, one would expect this to be made clear as it is elsewhere in the Act. Especially, one would expect it to follow the structure of s 101. It does not.

[45] The plaintiffs take support from the legislative history. In brief, during the

reading the section as requiring each director to have this attribute.¹³Ngapuhi submitted this should be amended to a requirement that only one of the directors need have this knowledge. The legislation remained unchanged. Whilst there is merit in the plaintiffs’ reasoning process, it is important not to overstate this point. There is no express statement by the Select Committee that this is its intended meaning, and silence in the face of one aspect of one submission does not necessarily equate to a positive statement of legislative intuition.

[46] Moving outside the language of the statute, I have no doubt that an interpretation that each director must have this attribute better reflects and advances the policy of the provision. In that sense it is the expected interpretation. Given the focus of te putea, and given that in reality the funds allocated to te putea were a very small percentage of the overall settlement, a requirement that all three directors have experience with the needs of the target group is not an unexpected criterion.

[47] It is appropriate at this point to discuss a submission made by the defendant concerning the expression urban Māori. It is noted that s 88(2), or indeed the Act anywhere, does not use that term. The expression is s 88(2) is “Māori who reside in urban areas of New Zealand”. The defendant submits that it is therefore wrong to see s 88(2) as reflecting the purposes identified by the plaintiffs. I accept that on its face this expression is much wider than the terms used in s 82(b) (Māori who do not associate with iwi and do not receive benefits from mandated iwi organisations). It is also much wider than ‘urban Māori’ in the sense the plaintiffs use it. The statutory term expression in s 88(2) is very broad and could include Māori who strongly identify with their iwi and who associate with the iwi, but who happen to live like most New Zealanders in an urban area (however that is defined).

[48] For reasons already discussed I reject this emphasis on the way the term is worded in s 88(2). The link back to s 82(b) is clear. TOKM's reading, if accepted,

¹³TOKM advanced a different interpretation of the Ngapuhi submission. The overall point is of insufficient significance to merit in-depth exploration. I consider the plaintiffs’ reading of the submission to be plainly correct.

[49] TOKM next notes that the directors have other requirements that will require a familiarity with the situation of iwi. For example, pursuant to s 84(1)(d)(ii), and indeed s 82(a), the directors are required to assess whether the applicant's iwi should be providing for the applicant. However, this is primarily a matter of obtaining information, and cannot be overstated. Given that applications may come from anywhere in the country from a variety of iwi, it is likely that whoever the directors are, it will be necessary to obtain this information.

[50] A further potential impact of an interpretation that all directors must reflect this attribute relates to s 89 of the Act. This provides that not more than one director of TOKM may be a director of Te Putea Trustee. The evidence is that TOKM always have had one of its own directors as a director of the trustee organisation to ensure continuity and cohesion. That may be desirable but it is not a consequence required by s 89, the purpose of which is to limit TOKM to one director. The section does not mandate that TOKM have one of its own directors as a director of Te Putea Trustee. It just limits TOKM to one. I am unaware whether there may be a TOKM director that also meets the s 88(2) requirement but that is a matter for TOKM.

[51] I am satisfied that the correct reading of s 88(2) is that each director must have knowledge of and be able to represent the interests of Māori who live in urban areas. Such an interpretation is consistent with the structure of the Act which expressly identifies the circumstances where attributes are only a collective requirement. It is also an interpretation that reflects and advances the policy of the Act. A declaration to this effect will be made as to the meaning of the term “the directors”.

[52] The pleadings seek much more than just this declaration. At the hearing I indicated that I would not go beyond this limited declaration. My reasoning was accepted but it is appropriate to briefly address the point. The two aspects where I am declining relief, and indeed declining comment, concern past appointments, and what the s 88(2) criterion means, in more detail.

[53] The plaintiffs alleged a TOKM policy of appointing two iwi directors and one urban Māori director. They claimed all past appointments reflected this policy. It was said the policy was unlawful (because of the incorrect interpretation of s 88(2)) and that past appointees did not meet the s 88(2) requirement.

[54] By the time of the hearing, the current directors had all resigned. The new appointment process awaits this decision. TOKM dispute their policy was as alleged, although it is plain that TOKM did not approach s 88(2) from the interpretation this judgment will require. There is now a clean slate and little is to be gained by looking back. Certainly and somewhat emphatically I decline to engage in an invidious assessment of the attributes of past directors.

[55] The second aspect concerns what the statute means when it says that the directors must be able to represent the interests of Māori who reside in urban areas. The plaintiffs claim as a minimum the directors:

Should be able to demonstrate a history of advancing urban Māori interests, advocacy on behalf of urban Māori interests and have affiliations to urban Māori, preferably at executive or managerial level with mata waaka, nga hau wha or urban Māori communities.

[56] It is clear that someone with these attributes would meet the test but beyond that it is not possible to say they are necessary attributes. Nor is there any profit in being so prescriptive. Other people may have different attributes that meet the statutory criteria. There may be others who have done none of the things outlined above yet have demonstrated such capability, and have such mana, that all would accept they could meet s 88(2). Little is to be gained by foreclosing that possibility.

[57] I note that there are other collective statutory requirements the board of directors must meet and it is unhelpful to be overly prescriptive about one criterion, thereby unduly limiting the available pool of directors who must also together provide these other attributes.

[59] The Act requires that a Review of the four main entities that implement the settlement be completed by the end of the 11^thyear after commencement of the Act (s 114(2)). The Review process prescribed by the Act is this:¹⁴

(a) first, a committee of representatives is to be appointed in accordance with a prescribed procedure;

(b) second, the committee of representatives is to set the terms of reference for the Reviews and appoint the Reviewer;

(d) fourth, the committee of representatives distributes the Review to specified groups; namely, TOKM, mandated iwi organisations, representative Māori organisations and the members of Te Kawai Taumata;¹⁵

(e) fifth, each entity under review “may” prepare a plan setting out how it intends to address the findings and recommendations of the Review. The entity has 40 days in which to do this;

60 days after step four, the Review and any plans are to be discussed. At this meeting, mandated iwi organisations only may make resolutions concerning the Review and any plans. The resolutions may adopt, or amend or adopt,

¹⁶Section 5 sets out who may attend – mandated iwi organisations, representative Māori

(h) finally, if any resolution has passed with a 75 per cent vote,¹⁷the entity under review must implement the resolution, and TOKM must forward a request to the relevant Minister if legislative amendments are required to implement the resolution.

[60] As regards Te Putea Trustee a resolution with the necessary majority was passed. It recommended increasing the number of trustees from three to five. In passing this one resolution the iwi organisations failed to endorse a more fundamental change recommended by the Reviewer.

[61] The plaintiffs challenge various aspects of the process for non-compliance with the statutory process, for breach of natural justice and for inconsistency with the statutory purposes. I first set out the relevant conclusions from the Review before describing the consideration process that followed.

[62] Mr Tim Castle, a barrister of Wellington, was appointed to conduct the Review at the one time of all four entities. His report was called Tāia Kia Matariki. It is important to recognise that Te Putea Trustee was but one of four entities being reviewed. The Review’s balance lies much more towards the other entities, and in particular TOKM and Aotearoa Fisheries Ltd. In that regard the report recommended the winding up of TOKM and the transfer of its assets ($172 million) to iwi.

[63] Turning to Te Putea Trustee, it emerges that Te Putea Trustee had been dysfunctional for many years. Successive audits had noted this, and the Review was critical of TOKM’s efforts to remedy the problem. It seems the difficulties stem from the need for all three directors to be present to constitute a quorum. The Review observed:

[63] The problems identified now over the last six years arising out of the apparent lack of willingness on the part of all directors to work together for the purposes of achieving the objectives of [Te Putea Trustee] is an issue which would ideally have been confronted much

¹⁷Representing more than 50 per cent of the total national iwi population (s 127(3)).

earlier. The problem was identified early. There would ideally have been a robust development of options for overcoming the key problem or problems with cooperation to find a resolution being essential in order that the entity discharge its obligations under the Act and for that matter its responsibilities to the beneficiaries of the Settlement.

[64] The reviewer discussed the various submissions concerning the future of Te Putea Trustee and expressly rejected TOKM’s proposition that NUMA’s proposal for more independent Māori control, was a power grab. It was noted that entities such as the New Zealand Māori Council supported reform and greater control being given to independent Māori organisations.

[65] A statutory task of the Reviewer was to consider was whether Te Putea Trust should continue at all. However, a recommendation to wind up Te Putea Trust cannot not be made if the Reviewer finds Te Putea Trust continues to fulfil its statutory purposes. Mr Castle recommended its continuation. However, he recommended the creation of a new trustee. The trustee would keep the same name but its ownership and structure would change.

[66] Unlike the present trustee (wholly owned by TOKM) the new trustee would be jointly owned by independent organisations and iwi. Schedule 5 of the Act identifies seven “Representative Māori Organisations”. Mr Castle recommended that at least three of these, but more if the others wished to participate, and NUMA, should each hold an ownership share. There should then be three to five shares held

by an iwi representative body. The shareholders would then appoint five directors.¹⁸

[67] Reflecting the much wider scope of the Review than just Te Putea, Mr Castle recognised the impact of his recommendations in relation to fishery assets. He recommended the establishment of an iwi working group to work through all the

[68] An iwi working group was established. It considered the recommendations concerning Te Putea as well as the wider issues. It had no urban Māori representative. It did not seek to consult directly with NUMA or other urban Māori groups. It conducted its consultation through advertised regional hui.

[69] As a basis for discussion at these hui, the working group prepared and distributed a draft working paper. There is some dispute about the distribution of this paper, and whether urban Māori representatives could have viewed it if they had taken advantage of the opportunity afforded by their role or connection to the various organisations to which it was distributed. Everything was also posted on the TOKM website. However, it is clear the working draft was not sent to the Schedule 5

[70] The regional hui were held, at the end of which the working group confirmed its draft in largely unchanged terms. At the regional hui it appears that on one occasion an urban Māori representative (Ms Huata who was the nominee on the committee of representative that set the terms of the Review) spoke. This occurred at the first hui. As requested by her, her submissions were reported to subsequent hui .

[71] Turning to the entities under review, Te Putea Trustee, probably reflecting its dysfunctional nature, did not prepare a plan. Te Wai Māori Trustee Ltd (whose focus is freshwater fisheries) did. Its plan was annexed to TOKM’s own plan. TOKM’s plan consisted of setting the process it followed on receipt of the Review, and then adopting, as its plan, the final Working Group document.

[72] The next statutory step is the holding of a general meeting of TOKM at which the Review, and any plans could be discussed. Before that, however, a further special hui was held. Its purpose was to develop final resolutions for presentation to the general meeting. The intention to hold this was notified to the representative

[73] It is plain that TOKM had multiple roles. It was a body under review; it has a governance role in relation to the other entities; it has a pivotal role in relation to policy and distribution of the assets; and it also had the organisational responsibility for seeing the statutory processes carried out. In this last capacity, on 3 June the board of TOKM met to discuss how the general meeting scheduled for the following day would be managed. The plaintiffs, in advancing a claim of unfair process place weight on the following extract from the minutes:

Simon spoke to the program for the SMG, noting that the Representative Māori Organisations would have an opportunity to speak during the morning session as would members of Te Kawai Taumata but essentially it was Te Ohu and AFL speaking with a brief presentation from Jamie on behalf of the [iwi working group]. ...

The Board discussed the possibility of legal challenge from John Tamihere and Willie Jackson with the support of the Māori Council, post SGM. It was agreed that both guys would be given an opportunity to speak at the SGM, acknowledgement given before moving on – don’t want to litigate or engage in any debate.

[74] The general meeting was held the next day. The resolutions settled upon by the extra hui had previously been circulated together with recommendations from the iwi working group as to how iwi should vote. For example, the first resolution was to wind up TOKM as suggested by the Review. The recommendation was for a “no” vote, and this is what occurred. With this and every resolution, the vote matched the iwi working group recommendation.

[75] The plaintiffs challenge various steps in the process. Although I consider a more global approach is required, I identify the individual grounds:

(a) TOKM’s plan, as authorised by s 126 of the Act, is ultra vires because the plan purports to amend or reject the Reviewer’s recommendations. A plan is limited to identifying what action the entity will take;

(b) TOKM’s plan is ultra vires because it comments upon the Te Putea Trustee recommendations. A plan must be limited to the organisation’s own response to its own review;

(d) TOKM’s plan is invalid because it was influenced by irrelevant considerations, namely the increased capacity of iwi to deliver to their own members, and the lack of iwi support for greater urban Māori control;

(e) the resolution concerning Te Putea Trustee is unlawful because it is inconsistent with the purposes of the Act as it guarantees greater direct iwi control over Te Putea;

(f) the process leading to the resolution was unfair and in breach of natural justice because of a lack of input opportunity for urban Māori;

(g) the resolution was unlawful because it was not truly the product of a vote at the meeting but it was predetermined by the prior processes.

[76] The statutory scheme is not comprehensive in terms of setting out what consultation is to occur in relation to the Report. If one starts with distribution of the Report (the entity under review having already received it), copies are to be sent to TOKM, iwi, representative Māori organisations, and members of Te Kawai Taumata (s 125(2)). However, looking at the end of the process, the Act provides that at the general meeting the agenda must only provide an opportunity for comment by iwi, and Te Kawai Taumata. In other words, there is no allocated spot for representative Māori organisations even though they are entitled to attend. Nor specifically is there a speaking spot for TOKM. Iwi alone can vote.

[77] Given this structure, it might be thought that if representative Māori organisations are required to receive the Report, but do not have allocated time at the general meeting, nor the right to vote, it must be the process in between that affords the opportunity for input. It is hard to conceive that the Review is distributed to them solely for informational purposes.

[78] However, in that 60 day period, the only potential statutory event that could provide an opportunity for input is that the entity under review may prepare a plan. But it does not have to, so this does not necessarily provide a consultation opportunity. And, probably because it was dysfunctional, or perhaps because some of the directors’ views were reflected in the iwi approach, Te Putea Trustee did not prepare a plan. On a strict application of the statute, Te Putea Trustee not doing a plan, there was no opportunity for either urban Māori as represented in the representative Māori organisations, or NUMA itself (a statutory consultee but not as a representative Māori organisation) to have input. And that is what happened: there

was none, other than a single speaking opportunity at one of the regional hui.²⁰

[79] On top of this statutory structure one must place what actually happened. At the suggestion of the Reviewer, and organised by TOKM, an iwi working group was established. It prepared a draft working paper for discussion purposes. This working paper addressed all aspects of the Review (as it should since iwi vote on the Review). This meant the working paper dealt with the recommendations concerning Te Putea Trustee. I do not understand the defendant to dispute that opportunity for input from urban Māori needed to be given. Its position is that the regional hui were sufficient, and that the Court should take a light touch when reviewing the actions of an ad hoc non-statutory body such as the working group. I will return to this shortly.

[80] TOKM prepare a plan, which was to adopt the iwi working group final paper. Its plan therefore includes recommendations concerning Te Putea Trustee. I do not agree with the plaintiffs that this was unlawful; I consider the opposite to be true. TOKM has a role in relation to all these entities. For example it owns Te Putea Trustee, it appoints its directors, and the directors must report to it. It is notable that s 125(2) requires the reviews of each entity to be sent to TOKM, a fact that reflects TOKM’s role in relation to all these bodies. So it was correct for TOKM’s plan to address Te Putea Trustee.

[81] However, with this role came obligations. I have no doubt that TOKM had a duty to consult with urban Māori before adopting the working group paper as its

²⁰That is not to say an urban Māori speaker, or member of the representative Māori organisations,

plan. This duty flows from the purposes of Te Putea Trust, the nature of the criterion directors must have, and the specific status accorded to NUMA within s 88(2). TOKM did not directly consult.

[82] Another way of viewing this issue is seeing TOKM as choosing to discharge its functions through the working group process. If so, that was a sensible process. The Reviewer had recommended it, and the statutory timeframe was very tight. Some consultation mechanism was needed in relation to very significant matters, and it seems to have been a very effective way of discharging a difficult task. But of course its obligations are not removed by adopting such an approach. This provides the answer to the defendant’s submission that the court should have a light touch when reviewing the working group. To the extent the working group is the focus of a natural justice inquiry, it is being assessed not in its own right, but as an agent of TOKM. If it is not such an agent, then the task comes back to TOKM itself, and it carried out no consultation.

[83] As for the regional hui, I do not consider the focus should be on whether there was adequate notice of the hui. The need to consult was greater than providing a general but limited opportunity at these hui. For the reasons already traversed, I consider the role of te putea required that relevant urban Māori groups be directly consulted and that this input find its way into the documentation being presented. It could be as part of the final paper, or as an extra component of TOKM’s plan. Otherwise, those taking the vote have been shielded from any output of the consultation with urban Māori. The statutory obligation to consult NUMA in relation to directors reflects the centrality of these interests to matters involving the Te Putea Trustee. This centrality is what creates specific consultation obligations.

[84] The voting at the general meeting followed a process that was inherently flawed in relation to Te Putea Trustee recommendations. The working group paper which formed the basis of all discussions reflects not only a lack of awareness of the statutory purposes of Te Putea but also an erroneous view of what matters are relevant for its proper functioning. I address each flaw.

[85] In terms of the statutory purposes, the concern that was identified earlier permeated the process: an illegitimate emphasis on te putea being open to all Māori at the expense of recognising its particular role in the settlement process, and the statutory purposes of Te Putea Trust. There is an extract from the iwi group’s working paper which illustrates this better than any commentary can:

43. We acknowledge that when the allocation model was being developed, there was concern that individuals who do not connect with or benefit from their iwi would not benefit from the Settlement. When [Te Putea Trustee] was proposed, this issue was acknowledged by including in the MFA a provision that the benefits of [Te Putea] should be made available as widely as possible to all Māori, having regard to:

a. the extent to which mandated iwi organisations are providing, or are able to provide, benefits to members of their iwi that are the same or similar to those that are able to be provided by Te Putea Whakatupu Trustee Ltd; and

44. We observe that with the enactment of the MFA in 2004 alongside individual iwi Treaty settlements, accountable iwi organisations have been established across the country through which individual Māori are increasingly re-establishing connection with their iwi.

45. The reviewer’s recommendations relating to [Te Putea Trustee] go against this trend, and would change the weight of influence on the Board more heavily towards Representative Māori Organisations. We do not agree with this proposal. We also note that the Reviewer proposes to amend the appointment criteria in a way that could give greater weight to urban Māori concerns. We consider that the current criteria for board appointments should remain. As far as distribution of benefits is concerned, we support retaining provision for Māori who do not associate with or who do not benefit from their iwi.

[86] It is important not to over analyse documents such as this which are not written as pieces of legislation or a precisely worded contract. That said, it is evident that the Review is not being analysed through a proper appreciation of the statutory purposes. It is here that the irrelevant consideration also emerge. The primary purpose of te putea was to provide access to settlement proceeds to those who do not associate with their iwi, and do not receive benefits. Proposals such as that

contained in the Review to make te putea more efficient cannot be analysed from a viewpoint of whether those proposals will hinder iwi efforts to reconnect with urban Māori. Even if individual Māori are reconnecting with their iwi, that does not diminish the purpose of te putea to provide for those who cannot or who choose not to. At the very most, any reconnection with iwi might diminish the number of Māori needing and eligible to access te putea, but that is speculative at this point and does not negate the need to ensure te putea meets its statutory purposes.

[87] The latter part of para 45 above reflects the danger about incorrect emphasis on the “access to all Māori” component. The last sentence can be read different ways but on its face does seem to reinforce a lack of understanding of te putea. It is not a matter of retaining provision for those who do not associate with their iwi; that is its very reason for existence. Providing for urban Māori in te putea was not a matter of aroha,²¹but duty.

[88] The effect of this is that the Review recommendations have never been properly considered because they have been analysed through this incorrect lens. That error was apparent from the first discussion document created. It taints every decision thereafter. This flawed link through the working paper, the hui, the final paper, TOKM’s plan and the resolutions presented to the general meeting is unbroken.

[89] Although I consider my general comments determine the second issue, it is appropriate to comment briefly on the various specific challenges to the response process.

[90] As noted, I do not accept the challenges to TOKM’s plan. There is no obligation on an entity to do a plan. This suggests that one should not be overly prescriptive about its content if a plan is done. TOKM had, from the outset of the Act, this general governance role. The Review dealt with all the entities at once, and

_{TOKM had roles and responsibilities in relation to all the entities.
Section 126}

requires the plan to address how the entity will respond “to the findings ... of the Reviewer”. This is sufficiently broad to embrace TOKM discussing its response to the Review of Te Putea Trustee as well as the Review of itself.

[91] Nor do I consider it would be helpful to unduly limit what TOKM's plan can cover. It is informational, designed to inform in particular, iwi, but also all interested persons how the trustees of the entity propose responding to the Review. It would hinder proper decision making to curtail TOKM’s ability to respond, given the role it has performed, and the experience it will have acquired.

[92] In relation to an input opportunity for urban Māori, there was no need for a dedicated place for urban Māori on the working group. That would have been one way of ensuring a voice, but given the breadth of issues covered by the process, which are mostly iwi issues, and given ultimately iwi have the only voting capacity, it was not obligatory to allocate a space. However, if not doing so, the obligation became to ensure alternative means were adequate. This did not happen. The extract from the Board’s Minutes does not read well in terms of the genuineness of any opportunity to speak at the general meeting.

[93] For the reasons given I accept the whole process as regards the consideration of the Reviewer’s recommendations for Te Putea Trustee was affected by a misunderstanding of, or failure to have regard to, the true statutory purpose of Te Putea Trust and Te Putea Trustee.

[94] Other than the extent to which the general meeting reflects these same flaws, I do not particularly see an issue with the general meeting. Obviously the outcomes were predictable but they were not pre-determined in a legal sense. It was legitimate to seek to arrange some order in advance. An unstructured free-for-all on such important and wide ranging issues simply would not work. The limited evidence

available²²does not satisfy me that the voting iwi were not open to persuasion, or

[95] As to the specific Te Putea Trustee resolution, it is not possible to say that of itself it is inconsistent with the Act and so contrary to s 127(2)(c) of the Act. It simply recommends there be five directors, with a quorum of three. This would necessitate a change only to s 87(2)(b). The quorum is presently three so no alteration is needed there. Its practical effect may have been different had I not agreed with the plaintiffs’ interpretation of s 88(2), but that is not the case.

[96] I turn finally to the issue of how drastic a change an amendment response to the Review Report may make. It is a difficult question as to what power iwi are given by s 127(2) of the Act which provides:

(2) At the meeting referred to in subsection (1), the mandated iwi organisations may resolve to–

(c) without creating an inconsistency with the purposes of this Act or the purpose of Te Ohu Kai Moana, amend, and adopt as amended, any of those recommendations.

[97] The plaintiffs’ proposition is that the Reviewer’s recommendations cannot be amended and adopted so as to achieve the opposite of what the Reviewer intended. On its face there is obvious attraction to that proposition, but the matter is not straightforward.

[98] First, it is significant that although many groups are expressly recognised throughout the process, when it comes to voting on the Review only mandated iwi organisations may participate. This reflects the central role that iwi have always had in the settlement. The settlement was with iwi. Recall, for example, the reasoning of the Court of Appeal in Thompson (at [24] above) as to why iwi control of Te Putea Trustee was not unreasonable.

[99] Second, it is not clear that every recommendation in the Review must be responded to by a resolution. One possible reading of subs (2) is that each recommendation must be dealt with in one of those three ways, but neither the subsection nor any part of the Act says that. Generally the status of the Review and its recommendations is left unclear. Is the Review a triggering device for discussion, or does it have some more binding role?

[100] An example of the lack of clarity is what the position is if iwi, having read the Review, agree a more efficient model is needed but do not embrace the one proffered by the Review. The proposition implicitly advanced by the plaintiffs is that the amending power cannot extend so far as to resolve on the alternative preferred way of implementing.

[101] I am not persuaded this is correct as it would mean the Act, has by the review process, transferred considerable power away from iwi to the reviewer. That seems inconsistent with both the purposes of the Act which was to implement the settlement, and with the scheme of the Act, such as s 127 which gives iwi alone the power to make resolutions about the Review recommendations.

[102] Subsection (2) is better read as empowering iwi rather than according a pre- eminence to the Review. The voting iwi may adopt some or all of the recommendations, or may amend some and then adopt. Alternatively, I consider, they can reject, which would leave the status quo in place.

[103] The further question, however, and that posed by the plaintiffs, is how far may iwi go when amending the Reviewer’s recommendations? Does this amendment power allow, for example, the adoption of an altogether different scheme? If it does, then the effect is that the Review has been only a trigger to allow iwi to implement their own new scheme, albeit informed by the review process. If it does not, then arguably it creates inertia whenever there is agreement that the current scheme is not working, but disagreement with the Reviewer as to how to fix it. It must be acknowledged, however, that there are other ways to seek legislative change, so inertia is not inevitable.

[104] It is not necessary for me to resolve this issue since the present recommendation does not engage this wider fundamental issue.²³I consider it must be open to the iwi to amend the Reviewer’s recommendation by adopting only part of it - namely the number of directors. If required, I would hold it open to the iwi to not adopt a recommendation as to a change in the ownership structure of Te Putea Trustee. It cannot in my view be the effect of the review process that iwi must

accept a complete change in ownership of Te Putea Trust. It must be open to say no, and make consequential amendments.

[105] As for the resolution itself, it leaves the current legislation unchanged but for the number of directors. It is therefore impossible to contend, as the plaintiffs do, that the resolution is inconsistent with the legislation. In light of my conclusion on the s 88(2) issue, much of the plaintiffs’ concerns with this issue fall away.

[106] To summarise, I consider that the process of consideration of the Review has been flawed. First, it has proceeded without proper regard to the purposes of Te Putea Trust. Second, it has not accorded urban Māori generally, and NUMA specifically as a statutorily recognised interested party, a proper opportunity to be heard and have input. These two flaws meant that the decision making process of the general meeting was correspondingly flawed.

[107] I have, however, concluded that a clear statement to this effect, as this judgment represents, is sufficient and an appropriate response. First, the resolution actually made is a sensible one. It is clear that the current structure is not working. A requirement that all directors be available in order for there to be a quorum has proved unworkable.

[108] Second, although the resolution must be forwarded to the Minister for consideration, the Minister will have the benefit of this ruling to assist consideration

²³I am conscious that iwi took the view that its amendment powers were constrained. Iwi preferred a different “Straw Tangata” model to the model recommended by the Review but a resolution records their view it was not open to them to advance this by way of amendment. Since the issue is not pivotal to this case it is preferable to not determine it.

[109] Third, the answer given on the interpretation of s 88(2) will itself have considerable impact on the functioning of the trustee. It may well be all that is needed to solve the issues and allow the current structure to work.

[110] Fourth, it is not obvious what situation would be created by an order quashing the resolution. The statutory timeframes are long past and the statutory processes are not particularly suited to the situation that now exists. It will be easier, if thought appropriate, for a new specifically structured consultation and consideration process to be undertaken. There is no reason that cannot occur even though the limited resolution is left in place.

[111] The correct reading of s 88(2) of the Māori Fisheries Act 2004 is that each director must meet the criteria contained therein. There will be a declaration to that effect.

[112] The consideration of the Review as it relates to Te Putea Trustee was flawed. Those conducting this part of the process, namely TOKM and the iwi working group, did not have proper regard to the purposes of Te Putea Trust when assessing the merits of the Review. Further, urban Māori were vitally affected by this aspect of the Review. There needed to be, and was not, a proper specific consultation process to present an opportunity for urban Māori views to be ascertained and considered.

[113] I decline relief given the limited nature of the resolution that was passed. Leaving this resolution in place does not foreclose a further consultation process occurring. Quashing it would not advance matters. TOKM is obliged to forward the one resolution to the Minister, but nothing prevents that being accompanied by a report on the outcome of a fresh process that gives urban Māori a proper opportunity for input, and which responds to the Review recommendations having had regard to the statutory purposes of Te Putea Trust.

[114] The plaintiffs have succeeded in their claim although relief is declined on the second issue. The parties recommend that the Court order the costs be borne by Te Putea Trust. I consider this is appropriate. The Trustee has not been functioning and court assistance was needed as to the correct interpretation of the governing legislation. The assets, whether those of Te Putea Trust, or TOKM, are all settlement assets. I direct that the reasonable costs and disbursements of both parties

High Court of New Zealand Decisions

National Urban Māori Authority v Te Ohu Kai Moana Tr ustee Limited [2016] NZHC 1600 (15 July 2016)

High Court of New Zealand

National Urban Māori Authority v Te Ohu Kai Moana Tr ustee Limited [2016] NZHC 1600 (15 July 2016)