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
A religious organisation was unsuccessful in excluding itself from the scope of the Royal Commission into historical abuse in state and faith-based care.
Royal Commissions are investigatory bodies established by the Governor-General (on the advice of Cabinet) under the residual royal prerogative power. This power is supplemented by the Inquiries Act 2013, which enables royal commissions to (among other things) compel parties to produce documents and give testimony under oath.
In 2018, the government established a Royal Commission whose terms of reference (“ToR”) required it to investigate historical abuse ‘in state care and in the care of faith-based institutions’.
The Christian Congregation of Jehovah’s Witnesses (Australasia) Ltd (“CCJWA”) are a corporate entity representing the Jehovah’s Witnesses faith in Australia and New Zealand.
The Commission notified CCJWA it was required to produce documents as part of the inquiry. CCJWA replied, stating that they did not fall within the scope of the inquiry as they did not provide ‘care’ in the relevant sense. This assertion was based on the tenets of the religion which emphasised parental autonomy and forbade church officials from providing childcare.
The Commission responded that it did not agree with this narrow interpretation of scope of the inquiry, and it reiterated this position later in two formal minutes. The Commission later emphasised in correspondence to CCJWA that it had received evidence of abuse by church officials that it considered brought CCJWA within the scope of the inquiry.
In 2023, CCJWA filed for judicial review arguing that the Commission’s actions were outside of the powers of the ToR, a breach of natural justice and legitimate expectation and predetermination (alleging the Commission should have consulted with CCJWA on matters of scope).
Subsequently the ToR were amended by the Governor-General on the advice of Cabinet (“Amendment Order”). The Amendment Order affirmed the Commission’s interpretation of the scope of the inquiry, and confirmed that ‘care’ could occur in the context of a trust-based relationship where the abuser is provided with authority by a religious institution.
CCJWA amended their statement of claim in response, arguing that the Amendment Order was also unlawful.
‘In the care of a faith-based institution’
Many of CCJWA’s judicial review grounds relating to pre-Amendment Order actions were based on the interpretation of ‘in the care of a faith-based institution’ in the ToR. They argued that ‘care’ had not been established, as CCJWA forbade its officials from engaging in childcare and emphasised parental autonomy. Accordingly, the assumption of responsibility by the institution necessary for a finding of care could not exist, and CCJWA was not within the scope of the inquiry.
The Court rejected this argument for two reasons.
First, the Court was not prepared to interfere with the Commission’s understanding of its scope, as it risked judicialising an investigatory process. The Court held that, in general, the scope of a Commission would be beyond judicial interference other than in obvious cases. This position applied even more so with this Royal Commission, which had a remedial rather than a fault-finding purpose (giving abuse survivors a platform), and where the ToR expressly required the Commission to avoid excessive formality and technicality.
Second, the fact that the church forbade officials from childcare did not immunise it from scrutiny. Complaints received by the Commission established the rules were not always followed. In doing so, the Commission drew on UK tort law cases, where the institution was liable for damages for abuse perpetrated by church officials clothed with authority by the church, even where the officials in question had acted outside of their official responsibilities and in breach of the institution’s rules. In this case, there was a tenable basis for finding an assumption of responsibility, and the Court was not prepared to second guess the Commission’s conclusions in this regard.
Accordingly, the majority of the pre-Amendment Order grounds were dismissed. The remainder were dismissed due to a general lack of merit.
The Amendment Order
While the interpretation of ‘care’ effectively decided the case, the Court went on to dismiss the claims in respect of the Amendment Order.
CCJWA argued the amendment of the ToR was invalid as it was made by the Governor-General on the advice of Cabinet rather than by a single Minister by a Gazette notice as is contemplated by section 7(5) of the Inquiries Act., The Court held that the power under the royal prerogative for the Governor-General to amend the ToR survived the passage of section 7(5). The Gazette notice power was intended to be supplementary to the prerogative.
CCJWA’s claims based on the alleged retrospective effect of the order were also dismissed. The Court held that the order was not retrospective – it merely clarified the Commission’s correct interpretation of ‘care’. Legislation is presumed not to act retrospectively under section 12 of the Legislation Act 2019.
Finally, CCJWA’s claim that the ToR unlawfully discriminated against their religion was dismissed. The ToR did not differentiate between Jehovah’s Witnesses and any other religion in terms of the scope of the inquiry.
The judicial review was dismissed.
The case establishes a precedent that, if followed, means that Royal Commission scoping decisions will be virtually immune from judicial scrutiny. In particular, litigants will be hard pressed to argue legal technicalities to extricate them from inquiries.
As the Court stated, “there is no fundamental right to be free from scrutiny”.
For further information on this case or similar issues, 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
