Max Barber is a Solicitor with Franks Ogilvie. He joined the firm in early 2023 and was admitted as a barrister and solicitor in March 2023.
Max joined the firm from BNZ where he spent seven years working across client relations and personal banking. He gained his Bachelor of Laws from Victoria University of Wellington.
Last year the government made changes to the Charities Act. The most important changes introduced by the Amendment Act that are already in force are:
· A requirement for charities to review their governance procedures at least once every three years
· An expanded definition of ‘officer’
From 5 July 2024, there are expanded objection and appeal rights for certain decisions of the Charities Registration Board (“Board”) and Charities Services.
Charities Services will have the power to exempt certain small charities from financial reporting requirements under the Act, however regulations need to be enacted before this power can be exercised.
Duty to review governance procedures
Registered charities are now required to review their governance procedures once every three years, with the first review due no later than 5 October 2026.‘ Governance procedure’ is not defined in the Act, but Charities Services guidelines suggest it is likely to include a charity’s primary governing document (usually a constitution or trust deed depending on the entity type) Any significant internal guidelines or policies should also be reviewed, particularly if they relate to financial management or conflicts of interest.
The review must consider whether the rules remain fit for purpose, and whether they continue to assist the charity to meet its charitable purpose and comply with the Act. Beyond this, the Act does not prescribe what must take place.
To ensure a bare minimum of compliance, charities should review at an appropriate meeting, which will vary depending on the type of entity. Incorporated societies should carry out the review at a members meeting, charitable companies at a shareholders meeting, and charitable trusts at a board meeting. This discussion must be minuted to demonstrate compliance with the Act.
Change in definition of ‘officer’
Officers are now defined to include “persons able to exercise significant influence over substantial decisions of the charity”. This is likely to include (among others) chief executives, treasurers, CFOs, and COOs. Such individuals are now subject to the minimum qualification requirements for charity officers, and can be disqualified for serious wrongdoing or significant breaches of the Act.
Entities wanting to register as charities must provide Charities Services with certifications of qualification from the expanded group of people included in the definition. Existing charities are required to notify Charities Services of appointments and resignations of key employees, compared to the prior position where this only applied to members of the charity’s governing body.
Exemption from financial reporting requirements
Charities Services will be able to exempt certain charities from the significant financial reporting requirements under the Act. Exempt entities will still be required to provide a minimum level of financial information, the specifics of which will be set in the same regulations. Drafting the regulations began in July 2023, but the date of any consultations (if they occur) or when the regulations are expected to be made is currently unknown.
This is a welcome change for small charities, which are the majority of registered charities. It was widely recognised prior to the amendments that the compliance difficulties for small charities were out of proportion to any transparency and accountability benefits that might arise from stringent reporting requirements.
Expanded objection procedure and appeal rights
From 5 July 2024, charities and some individuals can object to some decisions of Charities Services and all decisions of the Board by giving notice to the relevant decision-maker in accordance with the statutory procedure. Notice must be given within the timeframe stated in the preliminary notification of decision or within two months, whichever is earlier.
The grounds for objections are that the reasons for making the decision are unsatisfied, or that it is otherwise not in the public interest that the decision be made. The decision-maker is then bound by certain process obligations when dealing with the objection.
Additionally, the same decisions that are subject to objections may now be appealed to the Taxation Review Authority (“Authority”). There is no requirement to lodge an objection in respect of a decision before it can be appealed.
The procedure and powers of the Authority in respect of appeals is similar to a specialist statutory court – the process is clearly formal and adversarial, but the Authority has wide powers to regulate its own procedure and can relax evidential rules. Additionally, the Authority is empowered to determine appeals without hearing from the parties in person, provided that it consults with the parties before doing so.
Parties dissatisfied with a decision of the Authority have a right of general appeal to the High Court.
To understand more about this issue, please contact Director Brigitte Morten
An advocate for Pike River families successfully sought access to privileged documents relating to the decision not to prosecute people involved in the mining disaster.
On 19 November 2010, an explosion occurred in the Pike River Mine near Greymouth, claiming the lives of 29 workers.
In 2013, Worksafe made the decision not to prosecute Peter Whittal, the managing director of the owners of the mine at the time of the disaster, conditional upon Mr Whittal making a ‘voluntary payment’ to families of the deceased miners Two family members of deceased miners challenged this decision as an unlawful agreement to stifle prosecution. In 2017, the Supreme Court found for the family members, and the decision was held to be unlawful.
The Supreme Court decision did not lead to prosecution of Mr Harder, so the family members sought to hold officials and lawyers involved accountable through other means. During this process, they were assisted by Mr Harder, a former lawyer who was the applicant in this case.
Harder made an Official Information Act request for the Solicitor General’s legal advice to Worksafe. The request was declined under on the ground that this information was privileged. This decision was upheld by the Ombudsman.
In the present proceeding, the Harder then sought access to communications between counsel who negotiated the ‘voluntary payment’ so they could further appeal to the Ombudsman to reconsider their decision. Worksafe provided some documents but withheld others on the basis that they were privileged under the Evidence Act 2006.
Privilege is the concept that individuals have an absolute right of confidentiality in certain communications. This usually covers communications made in defined circumstances where the public interest is conclusively presumed to favour confidentiality over disclosure of relevant information. The archetypal example is legal professional privilege, where the ability to speak freely and frankly when seeking legal counsel is deemed more important than the benefit of obtaining relevant evidence.
When documents are privileged, it means they cannot be used as evidence in court or released under the Official Information Act (unless that privilege is waived).
This case concerned materials that Worksafe alleged were covered by sentencing negotiation privilege. These documents are privileged in order to promote parties to reach an agreed sentence in confidence that any admissions or discussions will not be used as evidence against them later. Promoting confidence in this area is desirable to minimise court delays and costs when processing criminal cases, thereby improving the efficiency of the court system. It is also necessary to spare victims and other participants from lengthy and occasionally traumatic involvement in criminal proceedings.
Unlike other forms of privilege that are virtually absolute (such as legal professional privilege), sentencing negotiation privilege is subject to a public interest balancing exercise. Accordingly, the court is enabled to order documents covered by sentencing privilege to be disclosed if (among other things) it would be contrary to the interests of justice to withhold it. By contrast, documents covered by legal professional privilege can usually only be disclosed if the privilege is used to perpetrate or conceal a crime.
In this case, it was not seriously disputed that the privilege applied, as that the communications occurred pursuant to negotiating the voluntary payment, an integral part of the prosecution decision. The key issue in the case was whether upholding the privilege was contrary to the interests of justice.
The court noted the value of the privilege in the administration of justice, which arose from relieving victims from the burden of testifying, reducing court and prosecution time and costs, and providing a structured environment in which the defendant could admit responsibility for offending. However, given the length of time since the Prosecution decision, these factors were given significantly less weight than normal. Another crucial factor was that Mr Harder already had access to similar documents obtained through other channels. Worksafe were only withholding the documents at issue in the case out of general principle.
In this context, the court held that the interests of justice were better facilitated by releasing the documents. Refusing to do so could only have the effect of encouraging false speculation and misunderstanding.
The court ordered that Worksafe disclose the privileged communications to Mr Harder.
Strictly construed, this case only has value as a legal precedent in sentencing negotiations. However, construed more broadly, it acts as an important reminder that government officials do not have an unfettered power to determine that documents are privileged and thereby withhold them from the public. The High Court in this case sent a clear message when officials should not be too ready to resort to privilege as a means of withholding information they would otherwise be required to make available under the Official Information Act. Applicants for official information can be confident that the courts will effectively scrutinise claims of privilege that do not reflect statutory and public policy factors underlying the privilege.
For further information on this case or similar issues, please contact Director Brigitte Morten
A consumer advocacy group successfully challenged directions by the Director-General of Health ordering 14 local councils to fluoridate their water supply.
New Health NZ is an incorporated society that describes itself as a ‘consumer-focused health organisation”. It is opposed to water fluoridation.
In 2021, Parliament enacted Part 5A of the Health Act 1956, which enabled the Director-General of Health to issue directions requiring local councils to fluoridate their water supply. Nothing in Part 5A required the Director-General to consider whether such directions limited the right to refuse medical treatment under s 11 of the New Zealand Bill of Rights Act 1990 (“BoRA”) and whether any such limitation was reasonably justified.
On 27 July 2022, the Director-General gave directions to 14 local authorities to fluoridate their drinking water supply to a specified concentration (“Orders”). The Director-General did not explicitly consider the BoRA implications of the decision as they had received legal advice that they were not required to do so.
The New Health NZ filed judicial review proceedings challenging the legality of the orders. Among other things, the plaintiff argued that the Director-General had failed to turn his mind whether the orders were compliant with BoRA rights or were reasonably justified limitations of those rights.
Did the Director-General have to turn their mind to BoRA matters when making the Orders?
At the time of the case, it was unclear whether public officials exercising discretionary powers were obliged (as a matter of decision-making procedure) to consider the BoRA impacts of their decisions. The parties agreed to address this preliminary legal question separately from the main proceeding.
The Crown, in their arguments, relied heavily on UK authorities, in particular the Denbigh decision of the House of Lords. In that case, the court rejected a requirement for decision-makers to explicitly consider the relevant human rights law in their decisions. The court, they reasoned, already had extensive powers to review the merits of administrative decisions for compliance with human rights law. An additional procedural requirement to consider such rights added nothing to the court’s oversight powers, and risked imposing a costly tick-box exercise on public officials.
In this case, Radich J held that the legal context in New Zealand was different to that in which Denbigh was decided, and agreed with New Health NZ’s argument that public officials not only had a duty to comply with the BoRA, but were also required to consider how their decisions impacted on BoRA rights.
Contrary to the Denbigh court (which had emphasised administrative efficiency), Radich J held that the consideration requirement would enhance rights by promoting a ‘culture of justification’ among public decision-makers – a culture where officials were obliged to explicitly consider how their decisions affected rights and give good reasons for departing from those rights.
How does the requirement apply?
Radich J noted that there was now effectively a two-stage approach for assessing the relevance of BoRA to discretionary public power.
First, the court would assess whether the decision-maker had turned their mind to appropriate BoRA matters. Failure to do so would render a decision unlawful in circumstances where BoRA matters were a relevant consideration.
Second, the court would consider whether a decision did in fact breach a BoRA right and, if so, whether that breach was reasonably justified. Where the decision breached the right without reasonable justification, the court could grant relief in accordance with remedies established in prior BoRA case law.
Asher J noted that there would ordinarily be significant overlap between the two-stages, and given the overlap, it would be expected that a decision-maker’s consideration of breach of the right and justifications for the breach would inform the courts analysis at the second stage.
The level of consideration would vary depending on the nature of the decision, the decision-maker, and the degree of relevance of BoRA rights to the decision. The court emphasised that consideration of BoRA rights was a matter of substance rather than a mere formality.
It was clear that the Director-General had never turned his mind to BoRA considerations when issuing the directions, and the decision was accordingly unlawful. However, the court declined to grant relief, instead leaving it to the parties to agree on next steps.
The case has significance to the public sector as a whole. Decision-makers are now required to address BoRA head on when exercising their powers. It remains to be seen whether this will promote a ‘culture of justification’ that enhances protection of fundamental rights, or whether it will merely add an unnecessary formal burden to administrative decision-making.
Due to the potentially wide-ranging impacts, there is a strong possibility that the Crown will appeal the decision.
To understand more about this issue, please contact Director Brigitte Morten
