10.3 Litigation

The general counsel (acting under the chief executive’s delegation) and their staff in the Ngā Ratonga Ture / Legal Services department manage litigation involving the council (initiated by council or against council). Litigation involves a range of decisions that are often irreversible and have significant consequences for the council. 

The Ngā Ratonga Ture / Legal Services department works with the relevant council staff, department or business unit involved in the proceedings. Staff members are expected to cooperate with the general counsel and their team to determine whether it is appropriate for them to give evidence or assist in the proceedings 

Approach to litigation

The council is committed to acting as a model litigant. This means more than acting honestly and complying with the law and court rules. The council also undertakes to act with propriety, fairly and in accordance with the highest professional and ethical standards. 

The council is also committed to managing litigation by or against it as effectively and efficiently as practicable, considering the legal, financial and reputational risks. The Council will: 

• take and defend legal action in accordance with the statutory functions and purpose, the principles of local government, and its strategic and operational objectives 
• only initiate litigation, including appeals, where there is a reasonable prospect of success and/or if the ligation is justified in the public interest 
• deal with litigation promptly and efficiently, without causing unnecessary delay or expense 
• when responding to litigation, consider the appropriate level of involvement it should have in each case, taking in to account the issues at stake and how important they are to the strategic objectives to the council, the participation of other parties and requirements or expectations of the court 
• seek to resolve claims as early as appropriate and consider and initiate (where appropriate) alternative means of resolution to avoid litigation 
• apply a fair and objective approach to handling litigation 
• not contest matters which it accepts as correct or make unmeritorious arguments for tactical reasons 
• act decisively and properly to protect and advance its interests as a local authority.  

Legal proceedings including prosecutions

The council’s commitment to acting as a model litigant is especially important when instigating legal proceedings. The council’s most common legal proceedings are prosecutions and enforcement actions for non-compliance with regulatory requirements, for example a breach of a bylaw, resource or building consent. 

In considering whether to bring an enforcement action or to prosecute, the council adopts an escalated approach, which means an enforcement officer will assess the nature of the non-compliance and, in particular, whether it was intentional.   

Prosecution 

In deciding whether to prosecute and throughout the prosecution, the council complies with the Solicitor-General’s Prosecution Guidelines which aim to ensure all prosecution processes are open and fair and reflect the public interest [1]. 

Elected members should not get involved in decisions on individual prosecutions and enforcement actions. This does not prevent elected members from engaging in the council’s overall policy on prosecutions. 

Generally, the council will prosecute cases of intentional non-compliance or recidivist or serious non-compliance (where there is serious impact or harm caused).  After a decision to prosecute is made, the council may consider diversion in accordance with the Auckland Council Diversion Policy.  

Where the non-compliance is non-intentional, the council may impose low level sanctions and require the non-compliance to be remedied instead of prosecuting. 

The council’s prosecuting lawyers have particular professional obligations [2] (in addition to their general professional obligations), including presenting the prosecution case fully and fairly and with professional detachment. 

Judicial review of the council’s decisions

The High Court can undertake a judicial review to determine if a council decision is lawful. A court can review most formal council decisions (including those by elected members and council staff) and the process by which they were reached. Ordinarily, a power that is the subject of review proceedings will be one that has been given to the decision-maker by statute. 

Usually, a person or group adversely affected by the decision brings a judicial review. 

The basic questions for judicial review include considering whether the decision-maker has acted: 

• fairly 
• within the scope of the power or discretion conferred 
• reasonably (normally, this means the decision-maker has not acted in a way that no reasonable decision-maker could have acted). 

Reviewing the council decision

The most likely grounds for a review of a council decision are that, in making the decision in question, the council decision-maker: 

• failed to follow the process specified in legislation for making the decision. 
• did not act fairly because they failed to consult with persons or groups affected by or interested in the decision (in particular, if the council did not follow the consultation requirements outlined in the Local Government Act 2002) 
• defeated a legitimate expectation of a person with an interest in the decision (for example a promise to do something in a particular way). 
• did not act fairly because they failed to give effect to the principle of natural justice. 
• made up their mind before hearing or considering all relevant matters (which means the decision-maker predetermined the decision). 
• considered irrelevant considerations, failed to take account of relevant considerations, made a mistake about the facts relevant to the decision, or made the decision for the wrong purpose. 
• could appear to an observer to have been influenced by a personal relationship, duty or consideration (which means the decision-maker had a conflict of interest). 
• made the decision after an invalid or unauthorised delegation. 
• acted outside the scope of the power or discretion or misinterpreted the applicable law. 
• did not actually make the decision but instead rubber-stamped the decision of an adviser. 

If a claim for judicial review is successful, it is up to the court to decide what, if any, remedy it will grant. Most often, the court will set aside the decision and direct the decision-maker to remake it. The court may direct how this should be done but will not direct the outcome of the decision. The court might also make declarations about the way the decision was made (for example that something that should have been done was not done, or that some matter that was taken into account by the decision-maker was not relevant). In some cases, the court may also award monetary relief, such as compensation for a breach of a fundamental right, or restitution where fees have been unlawfully charged. 

As part of the council’s model litigant commitment, the council will normally take a generous rather than technical approach to the disclosure of documents in judicial review proceedings. It is also expected to be candid in explaining its decision-making process to the court.  

Staff and elected members should be aware that information they prepare for internal purposes, including emails, may be released to opposing parties in litigation. 

Proceedings that name staff or elected members as defendants [h2] 

In legal proceedings involving the council, the appropriate party is Auckland Council rather than a specific decision-maker or part of council. The 'party' is the person or organisation which brings the action or defends the action. 

Elected members or council staff may occasionally be named as defendants in court proceedings in relation to the exercise of powers in their council role. In these situations, the council should be substituted as the correct party. If this does not occur, the practice is for the council to indemnify elected members or council staff and to conduct the proceedings on their behalf. 

Personal liability and indemnity for decision-makers

In some cases, an elected member or staff member may be sued for acts in their official capacity, but which have a more personal aspect. For example, an elected member may be sued for defamation because of the contents of a particular speech or public statement. Alternatively, proceedings may be instituted alleging that a council decision-maker has acted dishonestly or in bad faith. 

The extent to which the decision-maker will be personally liable in these cases will depend on the law and facts of the particular matter. 

By their very nature, cases brought against a decision-maker personally raise issues about whether they have acted within the scope of their legal authority. The council may not indemnify the decision-maker if they have acted beyond the scope of their authority. 

There is no absolute legal right to indemnity just because a person is acting as a council decision-maker. Visit Liability and protections to find out more.  

When a decision-maker is personally sued or threatened with legal action and is unsure whether he or she should be indemnified, they should seek the chief executive’s agreement (in consultation with the general counsel) in advance to meet his or her legal expenses. 

The general counsel (acting under delegation from the chief executive) may in some situations retain private counsel for a decision-maker. 

Court documents

Legal documents that must be served on the council may be served by leaving them at the council’s principal public office (135 Albert Street, Auckland) or given personally to the mayor or chief executive [3]. 

Once a document has been filed in the court, it is under the custody of the court, and access to such documents is controlled by the court [4]. Therefore, court documents (whether the council’s or another party’s) must not be disseminated beyond what is necessary for the council’s involvement in the proceedings. Such dissemination may be a contempt of court. 

Insured claims against council

In some cases, the council may be insured for the costs of proceedings or the quantum of any damages awarded against it. 

Staff should promptly notify the general counsel (or their team) of proceedings in which they have become involved to ensure any council-held insurance policy is not compromised. Admissions of wrongdoing, apologies and settlements of an insured claim, without consultation of the insurer, may invalidate the council’s insurance over that claim. 

If the claim is insured, council’s insurance and legal teams will manage the claim, in conjunction with the insurer and broker. 

Commenting on council legal proceedings

 It is inappropriate for staff or elected members to publicly comment on the substance of a matter involving the council when it is before the court. In some circumstances, such a comment may be a contempt of court. 

Elected members and council staff should be careful not to act in a way that jeopardises the council’s position in a legal proceeding. 

Elected members and council staff must not express views that are likely to be publicised if these views could be regarded as reflecting adversely on the impartiality or ability of a judge. It is improper for a person holding public office to make such comments publicly. 

Elected members must make clear that any public comments on judicial decisions (once the litigation is complete) are their own views and not the council’s. 

Footnotes

[1] Crown Law Solicitor-General’s Prosecution Guidelines (1 July 2013) at 1.1. 

[2] Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, rule 13.12. 

[3] Local Government Act 2002 s 250. 

[4] See Senior Courts (access to Court Documents) Rules 2017.