Bourneville v Legal Services Commissioner [2016] NZHC 694 (14 April 2016)

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UNDER	Part 1 Judicature Amendment Act 1972, Part 30 High Court Rules and the Legal Services Act 2011
BETWEEN	MICHAEL VICTOR BOURNEVILLE AND MARK GRAHAM BLEWDEN First Applicants MARK BOURNEVILLE Second Applicant MICHAEL VICTOR BOURNEVILLE, MARK GRAHAM BLEWDEN and MARK BOURNEVILLE Third Applicants
AND	LEGAL SERVICES COMMISSIONER First Respondent CHRISTINE JILL MARSHALL Second Respondent

Hearing:	14 April 2016
Appearances:	R J Hooker for Applicants L M Hansen for First Respondent A Hart for Second Respondent (abides decision of Court)
_Judgment:	_{14 April 2016}

This judgment was delivered by me on 14 April 2016 at 4.45 pm, pursuant to Rule 11.5 of the High Court Rules.

[1] This proceeding represents yet another stage in litigation that has occupied the attention of the Family Court, High Court, Court of Appeal and Supreme Court on numerous occasions for more than nine years. It has been filed because the second respondent, Ms Marshall, has instituted a proceeding against the applicants in this Court (the substantive proceeding) in which she seeks inter alia to establish that the applicants in the present proceeding hold certain property on constructive trust

[2] One of the applicants, Mr Michael Bourneville, was formerly married to Ms Marshall and he also lived with her for a period of time in a de facto relationship. In the substantive proceeding Ms Marshall seeks to establish an interest in property acquired by the applicants during the period in which she lived with Mr Bourneville in a de facto relationship. The substantive proceeding is scheduled to be the subject of a seven day trial in this Court commencing on 13 June 2016.

[3] Ms Marshall has prosecuted the substantive proceeding with the assistance of a grant of legal aid. The applicants believe she is not entitled to that grant, and they have corresponded with the first respondent, the Legal Services Commissioner (the Commissioner), on several occasions to that effect.

[4] In November 2015 the applicants wrote to the Commissioner requesting again that the grant of legal aid be withdrawn. By letter dated 2 December 2015 the Commissioner declined the request. In this proceeding the applicants seek judicial review of the decisions by the Commissioner to grant legal aid and not to withdraw it.

[5] The application for judicial review has a firm fixture on 28 April 2016. That hearing will begin with an application by Ms Marshall to strike out the proceeding

[6] Notwithstanding the proximity of that fixture, the applicants have applied for discovery against the Commissioner. The application has been heard as a matter of urgency given the fact that the fixture is just 14 days away.

[7] By the end of the hearing I had advised counsel of the orders that I proposed to make. I indicated that I would withhold delivering judgment until such time as counsel for the Commissioner had filed a further memorandum identifying those parts of documents that the Commissioner wished to withhold on the grounds of legal privilege or for any other reason. Upon reflection I believe the parties should have the benefit of my conclusions and reasons now. I will deal with the remaining issues in the manner set out at the end of this judgment.

[8] The application for discovery is governed by s 10(2)(i) of the Judicature Amendment Act 1972. This provides the Court with the power to require any party to make discovery of documents.

[9] The power to order discovery in judicial review proceedings has been the subject of judicial comment on many occasions. The authorities demonstrate that the likely relevance of the documents in respect of which discovery is sought will always be a matter to be taken into account. The decision to order discovery is discretionary, however, and must be exercised bearing in mind the nature and purpose of the judicial review procedure. I consider that the following passage from the judgment of Miller J in Te Runanga o Ngati Awa v Attorney-General captures the task of the Court when faced with an application for discovery in a judicial review

[6] It is common ground that discovery is available in judicial review, although it is discretionary. Mr Kos maintained however, that there is no significant difference in principle between discovery in judicial review and in regular civil proceedings, citing Compagnie Financiere et Commerciale du Pacifique v Peruvian Guano Co (1982) 1 QBD 55, 63 (CA). I prefer the view that judicial review is a relatively simple, untechnical and prompt procedure, and that Judges are responsible for narrowing issues and supervising the proceeding to ensure that the material placed before the

²Te Runanga o Ngati Awa v Attorney General HC Wellington CIV-2006-485-001025, 28 March

Court is reduced to the necessary minimum: BNZ Investments Ltd v CITR (CIV 2006-485-697, HC Wellington, 7 December 2006, Wild J). The material must be both relevant to the proceeding and necessary in the circumstances. In many cases, there is no room for the Peruvian Guano “train of inquiry” test.

[10] In the present case I approach the application bearing in mind the likely scope of the matters that will be in issue at trial, and the limited time within which discovery can be provided if the fixture on 28 April 2016 is to be maintained.

[11] The grounds for review are contained in an amended statement of claim filed on 13 April 2016. This contains two causes of action:

(a) The Commissioner erred in law by finding that special circumstances existed to justify a grant of legal aid in circumstances where Ms Marshall’s income exceeded the maximum earnings permissible for a person to be granted civil legal aid.

(b) The Commissioner’s decision is invalid and unlawful because it failed to take into account relevant factors and/or took into account irrelevant factors.

[12] The applicants seek orders setting aside the decision declining to withdraw the grant of legal aid and directing the Commissioner to reconsider whether the grant should continue taking into account all relevant considerations.

[13] Section 10(2) of the Legal Services Act 2011 (the Act) requires the Commissioner to refuse to grant civil legal aid to an applicant whose income exceeds a specified limit unless the Commissioner is satisfied there are special circumstances having regard to the likely cost of the proceedings to the applicant, and to the applicant’s ability to fund the proceedings if legal aid is not granted. The Commissioner acknowledges that Ms Marshall earns an income that exceeds the

maximum limit. The Commissioner has taken the view, however, that special circumstances exist to justify a grant of aid.

[14] The reasoning process by which the Commissioner concluded there were special circumstances in terms of s 10(2) will therefore be the focus of the first cause of action.

[15] The second cause of action alleges that the Commissioner erred in granting legal aid in the following ways:

(a) The Commissioner erred in her interpretation of the observations made by the Court of Appeal in 2013.

(b) The Commissioner erred in relying solely upon or giving undue weight to those observations.

(c) The Commissioner failed to take into account obvious and serious deficiencies in the current version of the statement of claim that Ms Marshall has filed in the substantive proceeding.

(d) The Commissioner failed to take into account the fact that the events that are the subject of the substantive proceeding occurred between

1996 and 2005, and this will give rise to serious prejudice to the applicants in defending the proceeding.

(f) The Commissioner failed to take into account the fact that Ms Marshall has been the recipient of legal aid in relation to several earlier proceedings in which her claims have failed.

(g) The Commissioner failed to take into account the fact that legal arguments, such as that of issue estoppel arising out of findings made in earlier proceedings, are likely to increase the cost of the substantive proceeding significantly.

(h) The Commissioner failed to take into account the fact that Ms Marshall has failed to conduct earlier proceedings in an efficient and cost-effective manner.

(i) The Commissioner failed to take into account the fact that past experience suggests that the current estimated trial duration of seven days is likely to be inadequate.

(j) The Commissioner has failed to take into account the likely cost of the grant of legal aid when compared to the likely benefit to Ms Marshall if her claim is successful.

(k) The Commissioner erred in failing to conclude under s 30(2)(c) of the Act that Ms Marshall has unreasonably required the substantive proceeding to be continued, and has conducted that proceeding in an unreasonable manner, so as to cause the Commissioner an unjustifiable expense.

(l) The Commissioner erred in failing to conclude under s 30(2)(d) of the Act that it is unreasonable and undesirable in the particular circumstances for Ms Marshall to continue to receive legal aid for the substantive proceeding.

[16] The reasoning process followed by the Commissioner will again be the focus of this cause of action.

[17] The Commissioner will rely at trial upon the evidence of Ms Shirley Braun, a Team Leader in the Rotorua office of Legal Aid Services. She has the responsibility for managing and overseeing decisions made in respect of grants of civil legal aid. Ms Braun has filed an affidavit deposing as follows:

7. I refer to the decision to grant legal aid to Ms Marshall then using the surname Bourneville dated 12 April 2011. A copy of this decision letter is contained in the affidavit of Frances Gush dated 22 March

8. Prior to that decision the Commissioner was aware that Ms Marshall was working and that her income exceeded the relevant maximum level.

9. However, an assessment was made at the time based on the information provided that the proceedings were likely to be complex and would be likely to run for some time.

10. As a result, the discretion was invoked and the decision made that Ms Marshall would not be able to reasonably privately fund the likely proceedings.

11. As a result of this assessment, the above special circumstances criteria were used to enable a grant of legal aid to be made.

12 April 2011, I confirm that the discretionary provisos in that section were utilised to enable a grant of legal aid to be made.

[18] Having heard the submissions of counsel, I am satisfied that the Commissioner should provide discovery of any internally prepared documents that show the reasoning process used by the Commissioner in reaching the conclusion that special circumstances existed under s 10(2). The Commissioner is entitled, however, to claim legal privilege in respect of those documents, or parts of those documents, that contain legal advice in respect of that issue.

The letters from the Commissioner to Ms Marshall’s counsel dated 12 March and 29

[19] The second cause of action focuses to a large extent on the factors that the Commissioner took into account when he granted aid and declined to withdraw it in December 2015. Documents that bear on those issues are therefore relevant to this cause of action.

2015 seeking information relating to Ms Marshall’s claim against the applicants. This resulted in Ms Marshall’s counsel sending a lengthy letter to the Commissioner on 8 May 2015. Ms Marshall’s counsel has disclosed the letter dated 8 May 2015 to the applicants in the course of the present proceeding. The applicants now seek copies of the letters from the Commissioner to Ms Marshall’s counsel dated 12

[21] Having viewed the letters, I am satisfied that they are directly relevant to the issues raised in the second cause of action. The Commissioner has been concerned about disclosing the letters to date because to do so might infringe Ms Marshall’s privacy rights. The fact that Ms Marshall’s counsel has already made her client’s response available to the applicants means that this concern is unfounded. I am therefore satisfied that the letters should be made available to the applicants.

[22] In the letter dated 2 December 2015 the Commissioner advised the applicants’ counsel that the applicants’ complaint had been “investigated by a panel of specialist advisers”. The applicants seek access to the advice given to the Commissioner by that panel because it formed part of the Commissioner’s reasoning process in deciding not to withdraw the grant of legal aid. For the applicants, Mr Hooker expresses scepticism as to whether the Commissioner ever referred his clients’ request to a specialist panel.

[23] Ms Hansen advised me that the Commissioner has not been prepared to disclose this information to date because it was written by two lawyers and contains legal advice. It also contains material that the Commissioner believes the applicants could use to their advantage, and to Ms Marshall’s disadvantage, in the substantive proceeding. Furthermore, it contains personal information about Ms Marshall that would not normally be disclosed to a third party.

[24] During the hearing Ms Hansen provided me with the original version of the document in question. Having read the document, I am satisfied that it contains a mixture of legal advice and non-legal advice. It is certainly directly relevant, because it sets out the factors that the Commissioner took into account when he decided not to withdraw the grant of aid in December 2015. For those reasons I consider it should be made available to the Court in redacted form when it hears the application for judicial review. I accept, however, that the Commissioner is entitled to exercise the right to claim legal privilege in respect of those aspects of the document that constitute legal advice.

[25] The area of greatest difficulty in relation to this document is that the document contains information about Ms Marshall’s claim in the substantive proceeding that the applicants might be able to use to their advantage in that proceeding. That would be wrong in principle.

[26] Mr Hooker does not act for the applicants in the substantive proceeding. They are represented by other counsel in that proceeding. If Mr Hooker is to view the document, as he must be able to do if he is to make submissions on it in this proceeding, he must do so subject to conditions that prevent the applicants from using material contained within it to their advantage in the substantive proceeding.

[27] The Commissioner is therefore to make the document available to Mr Hooker in redacted form. I direct that until further order of the Court Mr Hooker must not show the document to the applicants or any other person, and must not disclose material contained within the document to the applicants or to any other person without the leave of the Court.

[28] If any counsel refers to material contained in the document in written submissions filed prior to the trial, those references are to be removed from any copies of the submissions that might be sent to the applicants.

[29] I make a further direction that no material taken from the document may be used in any way in the substantive proceeding without the leave of the Court.

[30] It will be for the trial Judge to make such directions as he or she may think fit in relation to the manner in which material from the document is to be referred to during the hearing on 28 April 2016.

(d) Counsel for the respondents is to file and serve any statement of defence to the amended statement of claim no later than 12 noon on

[32] I consider both parties achieved a measure of success in respect of the application for discovery. For that reason my tentative view is that costs should lie where they fall. If either party takes a different view, counsel for that party shall file and serve a succinct memorandum no later than 26 April 2016. The opposing party shall respond within seven days, with the claimant having the right to file a brief

_{memorandum in reply seven days later. I will then deal with costs on
the papers.}

High Court of New Zealand Decisions

Bourneville v Legal Services Commissioner [2016] NZHC 694 (14 April 2016)