Adam is a solicitor at Franks Ogilvie. He joined the firm in September 2023 and completed an LLB/BA in 2024, majoring in History and Public Policy. He was admitted as a barrister and solicitor of the High Court in June 2025.
Prior to working at Franks Ogilvie, Adam was part of the team at the New Zealand Free Speech Union, running much of the back-end work of the organisation. He also interned for a Member of Parliament in 2020.
Adam is passionate about liberal democratic values and the importance of a robust civil society. Outside his work and studies, he enjoys getting out into the various tracks and DOC huts in the Wellington region.
The Court of Appeal upheld a High Court decision to decline a property developer’s application for summary judgment that it was the “Controlling Member” of a residents’ society, formed for the purpose of a development. The Court upheld a summary judgment that the “Controlling Member” position had been disestablished when the developer had sold all its land in the development.
Property development company Mangawhai Developments Ltd (“MDL”) was incorporated in 2005 alongside the Lake View Estate Residents Society Inc. (“Society”) for the purpose of developing and managing the Lakes View Estate (“Estate”). The Society’s responsibilities were the management of the Estate’s development and community facilities, with each residential property bound by a covenant to the Society. The Society’s rules had a position of “Controlling Member”, held by MDL as the developer. The “Controlling Member” was required to be present for the Society’s general meetings be quorate, at which it had a controlling vote. The Society’s rules (“Rules”) provided that MDL had the position of “Controlling Member” until the development was complete.
In 2009, MDL went into receivership. Shortly before this MDL had sold its remaining undeveloped land (“Land”), which was on-sold to a couple, the Ruitermans, and financiers Vermont Street Partners Ltd (“New Owners”). In 2017, the New Owners attempted to subdivide the Land and tried to claim the “Controlling Member” status for themselves. They got into a dispute with the existing residents, which was not settled until 2021. In 2019, during this dispute the Society resolved at a general meeting to remove the “Controlling Member” status from the Rules. MDL remained in receivership during this time, and its receiver did not attend the meeting which proceeded nonetheless.
In 2022, with the support of a few residents opposed to the New Owner’s development, MDL came out of receivership and attempted to assert its status as “Controlling Member”. MDL stated that as neither MDL nor its receiver had been present at the Society’s general meeting that removed the “Controlling Member” from the Rules, the meetings were not quorate and the rule changes were invalid. The New Owners rejected this claim, and the dispute went to litigation.
The High Court declined an application from MDL for summary judgment that it retained its status as “Controlling Member”. It gave summary judgment in favour of the New Owners that after MDL sold off the last of its land in the Estate, its role in the development was over, so the whole premise for the “Controlling Member” had fallen away and MDL no longer had that status. The Court also declined an application for summary judgment from the New Owners that MDL was estopped (precluded) from asserting “Controlling Member” status and that MDL’s action was an abuse of process.
MDL appealed against the High Court’s declaration that it was no longer the controlling member.
Clause 4.3 of the Rules stated that the “Developer” would be the “Controlling Member” of the Society until development of the Estate was completed. After this, they would be deemed to have resigned from the position, which would also be disestablished. “Developer” was specifically defined as MDL.
The Court of Appeal held that this prevented anyone but MDL from holding the position of “Controlling Member” as there was no provision for assignment or succession. This precluded the New Owners from taking on the “Controlling Member” status. Had MDL been contracted by a third party to develop the land, or was purchased outright, this position may have been maintained, but instead the Land was simply sold.
The Court of Appeal agreed with the High Court that the sale of the Land meant that MDL had lost the position of “Controlling Member”. Without any land to develop, MDL could no longer proceed as the developer, so for MDL the development was complete. Under the Rules this deemed MDL as having resigned from the position of “Controlling Member”.
The Court also dismissed the New Owner’s appeal against the declined application for summary judgment that MDL was estopped from asserting “Controlling Member” status due to MDL’s silence on its status during its receivership. There was no identified duty for MDL’s director to speak; there was no clear ascertainable loss to the New Owners. It was also not clear whether their reliance on this silence was reasonable, as the New Owners never attempted to contact MDL’s director about the “Controlling Member” status until several years after they had purchased the land. The Court also dismissed their appeal against the declined application to strike out proceedings on the grounds of an abuse of process. The Court held that MDL was entitled to have the matter of its status determined at trial.
The Court of Appeal dismissed MDL’s appeal, upholding the High Court’s summary judgment that MDL was no longer the “Controlling Member” of the Society. The New Owners would not require MDL’s permission to undertake any development, but would still be subject to the Rules of the Society, under the control of the residents.
This case underscores how important it is for incorporated societies to have a well-drafted constitution, and for their members to pay close attention to its provisions as decisions are made and events unfold. The effort to keep on top of a society’s rules may seem burdensome, but can save a lot of time and money should disputes later arise.
This case was determined under the Incorporated Societies Act 1908. The new Incorporated Societies Act 2022 is more prescriptive in its requirements for society constitutions and is intended to provide for more democratic governance of societies. The courts also have more extensive powers to alter society constitutions if their provisions are oppressive, or it is otherwise just and equitable to do so.
For further information on this or similar cases contact Director, Brigitte Morten.
The Restructuring Insolvency and Turnaround Association of New Zealand (“RITANZ”) declined Mr Kamal’s application for membership on character grounds. The High Court dismissed his application to quash that decision, but issued a declaratory judgement in his favour. The Court of Appeal upheld RITANZ’s decision to decline his membership application and allowed a cross-appeal by RITANZ against the declaratory judgement, which relaxed the procedural standards the High Court set for RITANZ when determining applications.
Mr Kamal was a former accountant who was subject to disciplinary sanctions by the New Zealand Institute of Chartered Accountants (“NZICA”) in 2009, 2010, and 2011. He was also convicted of six criminal tax offences in 2013, and sentenced to three months’ home detention and 150 hours of community service.
He resigned his membership with the NZICA before he could be removed, and began practicing as a liquidator. In 2015 he was found personally liable for a mishandled liquidation, and in 2018 was falsely holding himself out as a chartered accountant to prospective clients.
The Insolvency Practitioners Regulation Act 2019 (“Act”) required liquidators to become members of either NZICA or RITANZ. In 2020, the NZICA declined Mr Kamal’s application for readmission. In 2021, RITANZ also declined his application for membership, on the basis that he was not of good character.
Mr Kamal sought a judicial review of RITANZ’s decision to decline his membership. The High Court found that RITANZ had erred in its decision-making but only granted declaratory relief, giving a statement that RITANZ had been mistaken in the process it took to determine Mr Kamal’s application, but declining to overturn the decision itself. Mr Kamal appealed the High Court’s decision to uphold RITANZ’s refusal of membership, while RITANZ cross-appealed the High Court’s declaratory relief.
Fit and proper person test
The Act requires NZICA and RITANZ to issue insolvency practicing licences only if they are satisfied that the applicant is a “fit and proper” person. The Court of Appeal held that the standard was not perfection, but that RITANZ had ample evidence to show they were entitled to decline Mr Kamal’s application on the grounds that he was not “fit and proper”.
Mr Kamal submitted that the “fit and proper” test is forward looking, and that the Act contemplated that applicants who would not meet the test unconditionally may do so if they were given extra requirements, such as mentoring and supervision. The Court of Appeal agreed that the test was forward looking, but disagreed that he might be eligible for a conditional licence. The Court considered that conditional approvals would erode the “fit and proper” test so much that it would undermine the purpose of the licensing regime. It declined to quash RITANZ’s decision.
Cross-Appeal: the High Court declarations
The High Court identified four errors in how RITANZ’s declined Mr Kamal’s application for members and gave declaratory relief, without quashing the decision. These included not referring to and assessing three separate mitigating matters in a forward-looking way, and breaching the principles of natural justice by not putting an adverse finding against Mr Kamal to him.
On the mitigating factors, the Court of Appeal found that RITANZ was not required to dwell significantly on them, nor refer to them explicitly in its decision. RITANZ’s characterisation of Mr Kamal’s previous offending was accurate and relevant nonetheless, and the mitigating factors did not impact the overall outcome. This fact was acknowledged by the High Court’s refusal to quash the decision. The Court of Appeal found that omitting reference to those mitigating factors was not an error of law.
On the alleged breach of natural justice, the High Court found that RITANZ had put four adverse inferences to Mr Kamal, but not the adverse conclusion they had drawn from it, which was a breach of natural justice. The Court of Appeal held that despite not putting the conclusion to Mr Kamal, it had given him several opportunities to speak to the issues at hand before RITANZ drew its conclusions, and they were not required to adopt a more rigorous approach. Again, RITANZ had not made an error in law and the Court of Appeal quashed the High Court’s declaratory judgement.
The Court of Appeal dismissed Mr Kamal’s appeal and upheld RITANZ’s decision to decline his application for membership. The Court also upheld RITANZ’s cross-appeal and quashed the High Court’s declaratory judgement. Mr Kamal would not be allowed to practice as a liquidator.
By declining Mr Kamal the ability to meet the “fit and proper” test with a conditional licence, the Court showed how the test is a minimum standard that all insolvency practitioners must meet. This case also shows how professional bodies retain some leeway on how they decide membership applications. This is particularly so in circumstances where, despite minor procedural irregularities, the outcome would have remained the same.
For further information on this case or similar issues contact Director, Brigitte Morten.
Summary
Muaūpoko Tribal Authority (Muaūpoko) and Te Rūnanga o Raukawa (Raukawa) succeeded at the Court of Appeal in an application to quash an exemption for specified vegetable-growing regions from national bottom-lines (the “Vegetable Exemption”) in the 2020 National Policy Statement for Freshwater Management (“NPS-FM”).
Background
Muaūpoko and Raukawa represent iwi and hapū who both claim mana whenua over Lake Horowhenua and the Lake’s outlet, the Hōkio stream. These bodies of water are heavily polluted owing to decades of discharge into the lake, including fertiliser run off from regional vegetable growing.
The 2020 NPS-FM implemented the Government’s policy of Te Mana o Te Wai (“TMOTW”), which prioritised the health of freshwater bodies over the health and economic needs of communities. The NPS-FM provided objectives and bottom lines for water quality that Regional Councils would implement.
Vegetable growers expressed concern to the Minister that they would not be able to meet the bottom lines without significantly cutting back on fertilisers, threatening production viability. In response, the Vegetable Exemption was added to the NPS-FM, which permitted Regional Councils to set water quality targets below national bottom lines for 10 years for select vegetable growing regions, so long as the targets continued to improve the state of local water bodies without compromising food security and the domestic supply of fresh vegetables. Lake Horowhenua and the Hōkio Stream fell within this exemption.
The Minister for the Environment undertook limited consultation with Muaūpoko and Raukawa regarding the Vegetable Exemption, but this was only after an ‘in-principle’ decision had already been made to include it in the NPS-FM.
Muaūpoko and Raukawa unsuccessfully challenged the Vegetable Exemption in the High Court. The judgement stated that it did not contravene the Resource Management Act 1991 (“RMA”) and that a balance could be struck between the Vegetable Exemption and the TMOTW principles. The High Court also held that the Minister had not failed to consider mandatory relevant considerations, there had been adequate consultation on the policy, and there was no breach of the principles of the Treaty of Waitangi.
The case
The Court of Appeal accepted that the Minister had acted in good faith throughout the process, and had made some efforts to undertake consultation on the Vegetable Exemption with Muaūpoko and Raukawa. The Court however held that this consultation was not appropriate or sufficient.
The Court noted that consultation had to give meaningful opportunity for input by submitters. This included properly informing the groups being consulted about what is being proposed and giving them adequate time to prepare and make their views known. The Court noted various contextual factors with regards to Lake Horowhenua and the Hōkio Stream that required extra diligence on the part of the Crown when it undertook consultation on the proposed Vegetable Exemption. These included:
Muaūpoko and Raukawa were given little information when the Minister consulted with them, far less information than what was available to the Minister. They were also given very little time to consider that limited information, investigate alternatives to the Vegetable Exemption, and respond to the Minister. This did not meet the Minister’s obligation to undertake consultation.
The Court also held that the Vegetable Exemption “effectively introduced a new matter of national significance” to the NPS-FM, being the importance of the vegetable growing areas’ supply of fresh vegetables and national food security. Given that the exemption would require Regional Councils to contend with possible conflicts between the principles of TMOTW and the Vegetable Exemption, the Minister should have considered withdrawing all or part of the proposed NPS-FM. This would have enabled the Minister to undertake wider rather than targeted consultation on the Vegetable Exemption.
In coming to its judgement, the Court noted the Government’s desire for quick action on water quality reform, but considered that the situation still required considerable caution on the part of the Minister.
The Court also briefly commented on the other issues raised by the parties, citing the reasoning of the High Court judgement. The Court held that:
Result
The Court of Appeal allowed the appeal, quashing (one could say squash-ing) the Vegetable Exemption as contained in clause 3.33 and Appendix 5 of the 2020NPS-FM. The Minister was directed to reconsider the exemption.
For further information relating to this or similar cases please contact Director Brigitte Morten
