3 March 2010

A pressing question...

Andrew Geddis is trying to provoke a reaction from me about whether some local authority spending might be unlawful:
- Pundit: "Our liberty cannot be guarded but by the freedom of the press"

The background is another scrap in Wanganui.  As I understand it, the Council has proposed to:
1. pull $100,000 of its advertising from the Wanganui Chronicle;
2. transfer it's advertising to the rival River City Press; and
3. subsidise the operations of the Press, in order that it can increase its circulation, thereby ensuring greater currency of the Council's adverts throughout the district (particularly rural areas).

Apparently the Chronicle has a legal opinion which suggests this might be unlawful:
- WanganuiChronicle: "Council may face legal challenge over plan"

Geddis (understandably) dodges this question.  Or rather, despatches a hospital pass!
"(As an aside, I just haven’t had the time to look into the legal niceties around this particular issue. Graeme Edgler/Dean Knight/anyone else out there got any thoughts on this? That’s what the comments box is for!)"

So, unlawful?  I doubt it.  Unwise? Well, something for the voters, not the courts.

The decision-making framework for local authorities is complex, so there are potentially many legal quibbles folks might have with the proposal.  See my analysis of the decision-making framework at a recent conference:
- Knight "Local Authority Decision-making and the Consideration of Community View: Content and Compliance"

But I'll give it a quick go (without having seen the legal opinion):


1. The starting point is that local authorities have what's called a "power of general competence". Basically it means they can do whatever a natural person can do, except where something is otherwise prohibited.  This broad empowering provision is found in section 12 of the Local Government Act 2002:

"12 Status and powers...
(2) For the purposes of performing its role, a local authority has—
(a) full capacity to carry on or undertake any activity or business, do any act, or enter into any transaction; and
(b) for the purposes of paragraph (a), full rights, powers, and privileges."

No problems there - unlike the old days, particularly in the UK, where local authorities couldn't do things such as building a town clock, unless legislation explicitly empowered them to do so.

2.  The reference to "its role" in section 12 links back to sections 10 and 11 of the LG Act 2002.  Essentially, local authorities overarching mandate (or their jurisdiction to do things) is two-fold:
- to "enable democratic local decision-making and action by, and on behalf of, communities" and
- to "promote the social, economic, environmental, and cultural well-being of communities, in the present and for the future" within their districts.
Again, no problem here.  This is a broad statement of the role of a local authority.

3.  Local authorities must also act in accordance with a number of high-level principles set out in section 14 of the LG Act 2002.  Now, thede include things like democratic decision-making, taking account of community views, and – relevantly here – making "efficient use of resources" and "the efficient and effective use of its resources in the interests of its district or region".  Some arguments here.  But, importantly, I don't think any purported non-compliance with these high-level principles would result in findings of illegality by a court.  In other words, there principles are "non-justiciable".  Elsewhere our courts have held that they not going to entertain arguments about illegality based on such high-level principles, except in the case of bad faith, corruption and fraud (Mercury Energy Ltd v Electricity Corporation of New Zealand Ltd [1994] 2 NZLR 385).  Also, section 14(2) specifically directs that any conflicts about the high-level principles or aspects of the well-beings should be resolved in accordance with principle that local authorities must conduct their business in "an open, transparent, and democratically accountable manner". Again, indications that the courts should steer clear.  Any arguments are to be ventilated through the democratic processes.  And  ultimately accountability for judgements about the principles lies with the ballot box.  

4.  There might be a question about whether, as a matter of process, any decision was made in accordance with the individual decision-making principles in Part 6 of the LG Act 2002 or the other strategic planning processes.  But the devil's in the detail on this, and I don't have the information or the time to express a view on this.  But I think it's probably hard to be tripped up on this (see my conference paper above).

In short, I'm sceptical about any arguments that suggest the proposal might be unlawful.  But people closer to the dispute may help pinpoint the arguments that are being deployed.

Course Outline

Lord Justice Lawton in Maxwell v Department of Trade and Industry [1974] 2 All ER 122 said:

"From time to time ... lawyers and judges have tried to define what constitutes fairness. Like defining an elephant, it is not easy to do, although fairness in practice has the elephantine quality of being easy to recognise. As a result of these efforts a word in common usage has acquired the trappings of legalism: 'acting fairly' has become 'acting in accordance with the rules of natural justice', and on occasion has been dressed up with Latin tags. This phrase in my opinion serves no useful purpose and in recent years it has encouraged lawyers to try to put those who hold inquiries into legal straitjackets.... For the purposes of my judgment I intend to ask myself this simple question: did the [decision-maker] act fairly towards the plaintiff?"


This course examines the elephantine concept of fairness in the law, along with other contemporary legal issues.

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