Dialogue: We are privy to the legal cream

By STEPHEN FRANKS*

We are proud of mateship in our small nation, but it has downsides. With small, connecting circles at the top in law, business, politics and the media, unfair suspicion comes easy that insider mates will win over outsiders.

The Privy Council, a neutral international umpire, can be seen to judge without fear or favour. There are many other reasons for retaining access to some of the best judges in the world. They are set out on the Act website (at http://www.act.org.nz/action/privycouncil.html), along with counter-arguments.

Privy Council judges are outside local passions, connections and suspicions of improper influence. Their decisions have protected ordinary New Zealanders from outcomes favoured by our local elite.

But even more vital is the protection against political stacking of our courts and tribunals with dubious appointees. Even so, it is a live risk, as shown by Attorney-General Margaret Wilson's choice of Ella Henry for the Human Rights Commission and her dogged defence of her friend Susan Bathgate.

But when citizens have a right to appeal finally to dispassionate judges outside our little hot-house, the political benefits of ruthlessly stacking the Judiciary may not be worth the costs. It is worth it to a Mahathir or a Mugabe to cow his judges and to stack the courts. But not when citizens can appeal from a stacked court to judges out of the reach of the demagogue.

Fiji, the Cook Islands, and Vanuatu all give recent examples of the benefits when outsiders umpire serious internal disputes.

Are these fair comparisons? Are we not more mature as a rule-of-law democracy? We can't be smug. Think of Australian cynicism about the integrity of their justice system - blatant political stacking of their courts and trials of judges on top of endemic police corruption.

Labour politicians and activists have been appointed as judges. One, Lionel Murphy, was tried for lying while on their highest court. Our troubles with double dipping and expense-account padding pale in comparison.

A typical case shows how the Privy Council works for us. In 1991, Petrocorp and the New Zealand Government went to court over oil.

The Government granted itself a licence to prospect territory alongside major Petrocorp oil discovery licence areas. Petrocorp, owned by Fletcher Challenge, wanted its slice of the pie. It claimed that a joint-venture agreement with the Government meant that the next-door territory should be part of the joint venture.

The Government won the first round in the High Court at Wellington. Petrocorp tasted success at the Court of Appeal.

FCL lobbied politically to stop the Government appealing further. But at the Privy Council, all five judges found against Petrocorp. The millions gained by the Crown in this action alone would pay for a century of appeal expenses to London.

The Privy Councillors were unimpressed by the New Zealand judges' theories on interpreting contracts and statutory discretions. Orthodox New Zealand law was applied in London. As always in New Zealand cases, the Privy Council must apply New Zealand law.

The Privy Council knows oil companies from long experience. It was unimpressed by arguments that the New Zealand Government should kowtow to them.

Because it was the Privy Council which gave the Crown its five-nil decision, New Zealand was protected from unfair retaliation by oil companies. Their own losing counsel could have convinced themselves, and their clients, that the New Zealand courts were biased.

For example, one or two of the judges are likely to have had social connections with oil industry leaders or to have acted for them.

Such connections would not have influenced the decision in New Zealand. But an appeal to the Privy Council could reassure the New Zealand Government on that score. In our small country even the most scrupulous could be unfairly suspected.

The Privy Council's decisions are robust and succinct. The judges represent the legal cream of a population of 60 million. They deal with worldwide issues, full-time. In our tiny market, judges can more often confront points for the first and only time in their careers.

Having the Privy Council as an occasional reviewer of New Zealand judging is a cheap quality assurance, and a safety net. Once lost, it will never be regained.

We must move beyond misplaced nationalism. The real threat to our legal independence lies in Labour subjecting us to the jurisdiction of unelected United Nations committees with little respect for the rule of law, or our traditional freedoms.

* Act MP Stephen Franks was previously a leading corporate lawyer.