Asset Sales and Te Tiriti o Waitangi

Morgan has written today on the likely exclusion of a Treaty-principles clause in the legislation to allow for the partial sale of State Owned Enterprises.  He takes the position that the Treaty will not stop asset sales, but that partial sales without reference to Te Tiriti o Waitangi would be in breach of the principle of active protection.  I agree in part with his analysis, although in my opinion too much emphasis is placed on rather dubious claims of Māori interests that will be affected by any partial sales.  I will discuss those issues is a subsequent post, for now I will deal first with the contention that Te Tiriti can be used to prevent asset sales; and second, with potential legal avenues for Māori to pursue to challenge such legislation.

First, Te Tirit o Waitangi cannot be used, in and of itself, to override legislation.  Māori were offered that choice in the 1980’s when Sir Geoffrey Palmer advocated for a Bill of Rights which would have enshrined Te Tiriti in law and granted the courts the ability to strike down legislation.  Māori rejected the inclusion of Te Tiriti in the Bill of Rights and the clause allowing for judicial review of legislation was struck out.  Since then the courts have been consistent in their position that Te Tiriti is not part of New Zealand law unless it has been incorporated by Parliament.

That is where the argument that a claim can be lodged in the High Court alleging breach of the principles of Te Tiriti breaks down.  If the proposed legislation does not state that the Crown must act consistently with the principles of Te Tiriti then there can be no claim in the High Court that the legislation must be interpreted in accordance with the principles of Te Tiriti.  There is, as yet, no distinct legal remedy for a breach of Te Tiriti o Waitangi by the Government.

The leading case is the 2007 decision of the Court of Appeal in New Zealand Māori Council v Attorney-General [2007] NZCA 269 in a challenge against the introduction of legislation relating to the Te Arawa Deed of Settlement (The Te Arawa Case).  The Court made two findings that are important to consider in this context.  The first is that fiduciary duties (such as the duty of active protection) sourced from the Treaty itself could not form the basis of an action in New Zealand law.  The second is that the Court will not grant any remedies relating to the introduction of legislation to Parliament as to do so “would be to intrude into the domain of Parliament.”

The Court in the Te Arawa Case, therefore, explicitly rejected the claim that legal remedies can flow from a breach of Te Tiriti o Waitangi.  The success of the  1987 Lands Case, much cited in discussions of the principles of Te Tiriti, arose as a result of section 9 of the State Owned Enterprises Act 1986 which provided that nothing in the Act shall permit the Crown to act in a manner inconsistent with the principles of the Treaty of Waitangi.  It was section 9 which allowed the Court of Appeal to issue an injunction preventing the transfer of land from the Government to a State-Owned Enterprise under the Act until a suitable scheme had been agreed upon by which land transferred would be protected in the event that it will become part of a settlement with Iwi or Hapū.  Absence such a Treaty clause, the Courts will not be able to hold the Government to the principles of Te Tiriti o Waitangi.

In summary, the legal position is this:

– No court will grant a remedy against proposed legislation as to do so would breach the principle of non-interference into the activities of Parliament; and

– If the proposed legislation does not include a section requiring the Crown to act consistently with the principles of Te Tiriti, then no claim can be taken arguing that the Crown has acted inconsistently with such principles.

– A claim can be taken to the Waitangi Tribunal but any decision of the Tribunal in this area will be by way of recommendation only and will not be binding on the Crown.

Potential Legal Avenues

There remains one, as yet unexplored, legal avenue to pursue in the New Zealand courts.  Based on the landmark 1984 decision of the Supreme Court of Canada in R v Guerin, a claim could be taken along trust/fiduciary law principles as they relate to undertakings made to indigenous peoples.  In Guerin, a specific undertaking made by the Federal Government led to the creation of an enforceable fiduciary duty owed to the Musqueam of Vancouver.  The Canadian Government had placed themselves in a protector-protected relationship in respect of the aboriginal land of the Musqueam and traditional trust duties were held to flow from this relationship.  In a similar vein, it can be argued that the Crown holds in trust any land either vested in itself, or a State-Owned Enterprise, that is subject to a claim by Māori under Te Tiriti o Waitangi.

As I said, this argument is currently untested in New Zealand, and would require considerable legal effort to bring before the courts.  However, it is an argument that I will continue to develop over the next few weeks and it will be presented to the Government in support of the proposition that Te Tiriti guarantees should be included in any new legislation allowing for the partial sales of State-Owned Enterprises.


  1. Kia ora Josh, I’d be interested in this! Has Guerin been applied in NZ? I know it was argued in the urban Maori cases, but can’t recall what the Court said

    • Kia ora. No, Guerin has not been applied in New Zealand. It has been argued on numerous occasions, but most of the time the groups involved have failed to recognise just how narrow a ruling Guerin actually is.

  2. […] Update 2/2/2012: The Government has now called for submissions on how to deal with Te Tiriti o Waitangi in the context of the proposed mixed ownership model for State-Owned Enterprises.  I discuss this here, and I have also written about the consultation process.  For an initial discussion of the possibility of a legal challenge against any non-inclusion of a principles of the Treaty clause in the proposed legislation, you can find this in my article on Asset Sales and Te Tiriti o Waitangi. […]

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