Judicial Matters Bill

I want to address a couple of matters raised—and I know that Dr Kennedy Graham wants to say something about them—in relation to clauses 16A and 16B as set out on Supplementary Order Paper 108. These clauses set out the determination of the additional remuneration of High Court judges when they serve in the Court of Appeal. High Court judges either can join the permanent judges of the Court of Appeal in the full court of the Court of Appeal, or can sit with Court of Appeal judges in either the civil or criminal division of that court.

Apparently, there was always broad agreement about the remuneration that High Court judges would receive when they were sitting as judges of the Court of Appeal. It results from an arrangement that was entered into by the then Chief Justice and the then Secretary for Justice. It was resolved that High Court judges should receive the same salary as Court of Appeal judges, as determined by the Remuneration Authority, for their service in the Court of Appeal. That might be for 2 or 3 weeks, or it might even be for a couple of months. But that was the arrangement that was reached.

Some years ago a case came before Justice MacKenzie in the High Court at Wellington called Wikio v Attorney-General. I refer the member to the judgment dated 11 July. It was a broad-ranging attack on behalf of those applicants on the way in which certain judges were sitting on particular cases, be they retired judges with a temporary warrant, or judges of the High Court sitting in the Court of Appeal. Questions were raised, and Justice MacKenzie looked at this issue. He said that “given the constitutional importance of judicial salaries, I consider that the payment of an allowance to a High Court judge sitting on the Court of Appeal should rest on a more secure constitutional foundation than is apparent on the evidence before me.” He did not express a final view, but he made that comment. So it was thought that the sooner this matter could be cleared up the better. The judgment was given on 11 July 2008, and this Judicature Matters Bill was simply seen as a good opportunity, given the relative infrequency of legislation affecting the Judicature Act coming before the House, for us to try to sort out the matter.

The question that I believe that the member Dr Kennedy Graham may raise is of retrospectivity, and, admittedly, clause 16B adopts a belt and braces approach. I suggest to the honourable member that it is not like cases of retrospectivity that validate, for example, an unlawful taking, but it is a declaration in a belt and braces way. It is dealt with in this way simply because the issue was raised but was not finally determined before that learned High Court judge.

As was said earlier, the Labour Party will respect the agreement reached to support Supplementary Order Paper 108, but I ask the Committee to reflect on whether it is an entirely satisfactory state of affairs to have a matter of constitutional importance, as this is, come before the Committee by way of a Supplementary Order Paper.

One of the important constitutional issues that we deal with in this place is the issue of judicial remuneration. Clearly, it should not rest on an improper foundation; clearly, we should not in any way threaten judicial independence by intimating to the judiciary that the remuneration that they are entitled to receive might, by executive or legislative whim, be reduced. So this is obviously the right thing to do, as the reasons for judgment of Justice MacKenzie made it clear that the evidence before him indicated that this higher duties allowance, if you like, was paid on a very flimsy basis.

Let us recall the basis that is set out in the judgment. It was an agreement between former Chief Justice Eichelbaum and the former Secretary for Justice. It was a memorandum initialled by the two of them, made necessary because of the increasingly common practice at the time of using a member of the High Court on a substituted basis in what has become known as the Court of Criminal Appeal. Most members would agree that it is proper for a judge of the High Court to be paid some form of “higher duties allowance”—I will again use that colloquial expression—when discharging the duties of a judge of the Court of Appeal. Permanent judges of the Court of Appeal earn considerably more than a High Court judge, even though the two share the High Court warrant as the basis for the exercise of their jurisdiction. The fact that this practice could go on for so many years, based on simply an initialled piece of paper between the senior judge in the High Court and the administrative head of the Ministry of Justice, is a matter for wonder. It is a matter that we all ought to reflect on in this Committee, because it shows how flimsy and how shaky our arrangements concerning the constitution are.

I well recall the rousing speeches made by the Minister in the chair, the Attorney-General, only a year or so ago, when he was in Opposition. He talked about the urgent need for reform of the civil justice system. Well, here we have obvious evidence of one of the principal reasons for that reform: the fact that for many years we could not even get put on to a sound constitutional footing the basis on which a High Court judge sitting in the Court of Appeal should be paid more for doing that.

I record my gratitude that Justice MacKenzie set out the matter the way he did. It is a delicately worded judgment, given the broad nature of the challenges that were put before the High Court, and it is appropriate that this Committee address the matter. I would have preferred to see it addressed not by way of a Supplementary Order Paper but by way of a proper hearing before a select committee, but, as I say, agreement has been made that that will not happen, and we will deal with it in the Committee of the whole House without any public scrutiny. Let us, though, reflect on just how flimsy are the foundations some of these fundamental arrangements rest on. Let us resolve, if we can, to do something about that issue as we go forward.

I pick up where I was before. My comments are, essentially, very much concurrent with those expressed by Mr Chauvel, but I must say that they were arrived at independently in terms even of our initial approach to Supplementary Order Paper 108. I take on board all the points made by the honourable Attorney-General, and in light of his explanations the Green Party has resolved to support Supplementary Order Paper 108.

But for the reason that was just cited—namely, that this issue will not go before a select committee but will be dealt with here in the Committee of the whole House—I think it is very important, given the fundamental nature of what we are about here, that we explore it a little. I draw to the Committee’s attention the fact that the Supplementary Order Paper would in effect specify that a higher duties allowance is payable only to a judge who—and this is a drafting point—“is or was not a Judge of the Court of Appeal holding office” under the Act. The purpose of this provision is that such allowances will be payable only to judges from the High Court who are serving temporarily on the Court of Appeal.

I make two points. One is essentially a drafting point, I guess, and one is of substance. On the first, I may stand corrected, but if I am right the Government can convey its appreciation later. It is just a point of syntax. A strict reading of the Supplementary Order Paper would have the allowance paid only to judges who either are currently judges of the Court of Appeal or who never were. That surely is not the intention. I repeat the phrase: a judge who “is or was not a Judge of the Court of Appeal”. Surely that is not the intention. Surely it is better to have it read: “payable only to a judge who is not or was not a Judge of the Court of Appeal.” But enough of that; I will leave that to the drafters.

The point of substance concerns the reason for the amendment; it is because of an administrative error that was recently uncovered, as has been noted. At present the relevant Act refers only to permanent judges, and High Court judges who are temporarily seconded to the Court of Appeal do not qualify as permanent judges of that court. They are therefore, under the current legislation, not eligible for any higher salary when they serve in that court. For the past 11 years, from 1998 to this day, they have been paid what is called a higher duties allowance. The problem is that under existing legislation what they are being paid is not strictly an allowance either. The Ministry of Justice, largely unfazed by the constitutional niceties, got around the vexing problem back in 1998 by bureaucratic decree. To quote the Ministry: “Although the difference between the two salaries is labelled an ‘allowance’, it is not actually an allowance in the sense that term is used in the Judicature Act. The payment of seconded Judges’ salaries in this manner (ie, using the administrative tool of a ‘higher duties allowance’) is done for administrative convenience, as it enables seconded High Court Judges to be paid the salary of a Judge of the Court of Appeal while sitting as a Judge of the Court of Appeal, without having to alter the payroll system. The term ‘allowance’ is used because it is one that is recognised by the automated payroll system.”

💬 Fantastic: this is just an administrative sleight of hand to solve a day-to-day problem. But is it? Well, no, it is not. In fact, the payment of this allowance has become an issue in the courts, where it has been argued it has constituted an unlawful payment by the executive branch of Government directly to the judge, in breach of the ancient constitutional principle of non-interference in judicial salaries. The High Court, as the Attorney-General noted, ruled on this matter in July 2008. In that ruling the judge held that “The constitutional importance of arrangements concerning judicial salaries is such that there must be a clear statutory basis for all amounts paid to Judges by way of salary and allowances.” Given the constitutional importance of judicial salaries, he considered that payment of an allowance to a High Court judge sitting on the Court of Appeal should rest on a more secure constitutional foundation than was apparent in the evidence before him. The Attorney-General has essentially explained that to all our satisfaction. The issue, said the judge, was the effect that the making of the payment, if it were unconstitutional, might have on the independence and impartiality of the courts. Such concern related to the constitutional position of the judiciary as a whole.

So we are not dealing with administrative trivia here; we are talking about fundamental issues of our constitution, as Mr Chauvel has pointed out—namely, the independence of the judiciary from the executive. It seems that for the past decade New Zealand’s constitutional stability has basically been held hostage to the whims of a computer programmer, or, to put it another way, the payroll system of the Ministry of Justice was unable to accommodate our constitution. The effect of all this is that the legislature is asked to retrospectively validate financial payments to the judiciary, which the executive, through administrative convenience, has made, if not unlawfully, then certainly on an insecure constitutional foundation. That is the judgment of the Supreme Court. Clearly the Government concurs, because if it did not, it would not be submitting the Supplementary Order Paper to make payments rest on a secure foundation.

The outcome is that this Committee is being asked to retrospectively validate payments over the last 11 years. I have to say that I do not enjoy being asked to retrospectively validate anything, certainly not financial payments to the judiciary, and certainly not when I am being assured that those payments have rested on a shaky constitutional foundation. Given that concern, the Green Party gave consideration to opposing Supplementary Order Paper 108 not because we oppose the payment to judges and not because we seek to keep the constitutional foundations or the separation of powers insecure but because of a reluctance to endorse retrospective legislation.

The Attorney-General has recently been good enough to provide us with the authoritative work on retrospective legislation: Burrows and Carter’s work, Statute Law in New Zealand. The essential point in that work is that, in essence, retrospective legislation is objectionable only in three situations: if it takes away existing rights or defences, if it makes things unlawful that were lawful when they were done, or if it attaches a tax or liability to something done in the past. It seems that the higher duties provision in this Supplementary Order Paper does none of those things. In deference to the authoritative judgment, we shall therefore support the Supplementary Order Paper.

This is not intended as a rebuke of this Government, or of the previous Government for that matter; it is more a call for greater acuity on the part of the executive, essentially, which was where the problem arose. Let us simply hope that we are not frequently asked to undertake this kind of retrospective wave of the legislative hand, to cast a veil over the accumulated shortcomings of a harassed executive for the sake of a resource-constrained judiciary. It is an unedifying action for all three branches of Government, and the less we have to resort to this kind of thing, the better off we all are.

I rise to endorse the comments of my colleague from the Green Party and of my colleague Charles Chauvel. I think both have indicated the seriousness of the issue that we are addressing tonight. The point I make, and that I would have made before, is that the key for me is that this is an issue the Government knew it would have to address last year, and we are now in March. Instead of referring the Supplementary Order Paper to the debate here in the Committee stage now, that Supplementary Order Paper could have been referred to the Justice and Electoral Committee by leave. That would have allowed the select committee the opportunity to call for submissions and to develop an in-depth understanding of the issues that are involved without doing so on the floor of the Chamber.

I do not have the case in front of me, so I have not refreshed myself in terms of the detail of it, but my recollection—and this is from the dim, dark, distant past—is that arguments were mounted on behalf of those applications for judicial review by a couple of people who were convicted following a criminal trial. The arguments that were mounted on their behalf were quite offensive on a lot of levels, certainly to me, in terms of what they indicated might motivate judges in terms of the decisions they would be making, based on this “acting-up” allowance and their being beholden to the executive.

As I say, I really would appreciate the Attorney-General giving us an oversight for the record so that we have it on the record here in the Committee what the arguments were, and why the Government has chosen now to address this problem in the way it has. I think the Attorney-General has a very clear understanding that the only concerns we are expressing at this point are now around process, and that there really is not an argument about the need for addressing the issues. As we say, it is very important that these matters are placed on a secure constitutional foundation, because no one would want to risk allowing a challenge by way of judicial review to succeed, certainly on the grounds on which I recall this case was undertaken. Some time in the future somebody will be looking at this issue and at the debate that we held tonight, and he or she will be looking to see what the motivation was in terms of the Government’s position on this particular bill to make sure that these issues were fully debated and addressed in this Chamber, given that they were not able to be addressed at select committee level.

The other thing I would really like from the Attorney-General—because I think a lot of goodwill has been expressed in this Chamber tonight—is an indication as to whether, perhaps, in future we could look at the option of referring the Supplementary Order Paper to the select committee by way of leave, rather than seeking leave to have it debated outside the scope of a particular bill. I feel that if that had been achieved, we would all have had a much better understanding of what the issues were.

I hear what the three members have said, and I appreciate their comments. I think we are all at one, as was said by Justice MacKenzie. But the constitutional importance of arrangements concerning judicial salaries is such that there must be a clear statutory basis for all amounts paid to judges by way of salaries and allowances. I acknowledge, and I think I am on record as saying, that the Judicature Act is a bit of a dog’s breakfast and needs a complete rewrite. I hear what members have said, and I will be taking it further.

There is remaining just the other issue that Kennedy Graham referred to, which is the drafting issue in respect of new subclause 16A(2), which inserts new subparagraph (1A)(a)(i), with the wording “is or was not …”. I would like to have an assurance from the Attorney-General that he has checked the wording with officials, and that they are happy with it. Thank you.

The CHAIRPERSON (Lindsay Tisch): We will just get clarification on that point.

I can so advise.

The question was put that the amendments set out on Supplementary Order Paper 108 in the name of the Hon Christopher Finlayson to Part 2 be agreed to.

Amendments agreed to.

Part 2 as amended agreed to.

Schedule 1 agreed to.

Schedule 2 agreed to.

Clause 1 agreed to.

Clause 2 agreed to.

The Committee divided the bill into the Judicial Conduct Commissioner and Judicial Conduct Panel (Deputy Commissioner and Disposal of Complaints) Amendment Bill, the District Courts (District Court Judges) Amendment Bill, and the Judicature (Judicial Matters) Amendment Bill, pursuant to Supplementary Order Paper 109.

Bill reported with amendment.

Report adopted.