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New Zealand Bill of Rights Act Reports |
Last Updated: 28 April 2020
3 April 2009
ATTORNEY-GENERAL
LEGAL ADVICE
CONSISTENCY WITH THE NEW ZEALAND BILL OF RIGHTS ACT 1990: EDEN PARK TRUST AMENDMENT BILL
1. We have considered whether the Eden Park Trust Amendment Bill (‘the Bill’), a Private Bill in the name of Hon Murray McCully MP, is consistent with the New Zealand Bill of Rights Act 1990 (‘Bill of Rights Act’). The Bill was introduced to the House of Representatives on 26 March 2009 and is currently awaiting its first reading. We understand that the next Members’ Day is scheduled for Wednesday, 8 April
2009.
2. We have concluded that the Bill appears to be inconsistent with section 19(1) of the Bill of Rights Act and that the inconsistency cannot be justified under section 5 of that Act. We have consulted with the Crown Law Office in preparation of this advice and it agrees with that conclusion. Accordingly, we recommend that, as soon as practicable, you bring the Bill to the attention of the House of Representatives pursuant to section
7 of the Bill of Rights Act and Standing Order 261. We have attached a draft report under section 7 for your consideration.
PURPOSE OF THE BILL
3. The Bill amends the Eden Park Trust Act 1955 (the ‘Act’). The Act, among other things, constitutes and incorporates the Eden Park Trust Board (the ‘Trust Board’), declares the trusts upon which property is held by the Trust Board, and sets out the legal framework for the powers, duties, and functions of the Trust Board.
4. The purpose of this Bill is to implement the new governance arrangements for Eden Park agreed by the Government, the Trust Board, and the Eden Park Board of Control, the terms of which are set out in the trust deed that is to be included as a Schedule to the Act. The new governance provisions are necessary to facilitate the redevelopment of Eden Park in advance of the 2011 Rugby World Cup.
INCONSISTENCY WITH SECTION 19(1) OF THE BILL OF RIGHTS ACT
5. Section 19(1) of the Bill of Rights Act provides:
‘Everyone has the right to freedom from discrimination on the grounds of discrimination in the Human Rights Act 1993.’
6. Section 21 of the Human Rights Act 1993 specifies the prohibited grounds of discrimination. These grounds include, inter alia, ‘disability’ which includes:
• physical disability or impairment
• physical illness
• psychiatric illness
• intellectual or psychological disability or impairment
• reliance on a guide dog, wheelchair or other remedial means, or
• the presence in the body of organisms capable of causing illness.
Possible Discrimination on the Grounds of Disability
7. We have considered whether clauses 20.8(d), 20.9(d) and 20.9(e) of the trust deed (which is made a Schedule to the Act by clause 11 of the Bill) gives rise to an issue of discrimination under section 19(1) of the Bill of Rights Act.
8. Clause 20 of the trust deed governs the ‘Appointment and Removal of Trustees’.
Clause 20.9(d) provides that an individual is incapable of being appointed, reappointed or holding office as a Trustee if she or he is ‘mentally disordered’ within the meaning of the Mental Health (Compulsory Assessment and Treatment) Act 1992 (‘MH(CAT)’). Clause 20.9(e) provides that an individual is similarly incapable if she or
he is the subject of an order under the Protection of Personal and Property Rights Act
1988 (‘PPPRA’). Clause 20.8(d) provides that the appointment of a Trustee shall be vacated if the Trustee is incapable of holding office for the reasons set forth in clause
20.9.
9. For purposes of the MH(CAT), an individual is ‘mentally disordered’ only where she or he is suffering from an abnormal state of mind (whether of a continuous or intermittent nature) of such a degree that it:
• poses a serious danger to the health or safety of that person or of others, or
• seriously diminishes the capacity of that person to take care of herself or himself.
10. For purposes of the PPPRA, a Court may issue orders where it determines that an individual lacks capacity, in whole or in part, to manage her or his personal or property interests, or lacks capacity to communicate her or his wishes with respect to those interests. Relevant factors to the determination include the ability to communicate choices, understand relevant information, appreciate the consequence of a situation and rationally manipulate information. Temporary orders may also be issued where the Court has reasonable grounds to believe an individual may be incompetent.
11. Clauses 20.8(d), 20.9(d) and 20.9(e) use an individual’s status as ‘mentally disordered’ or subject to an order under the PPPRA as a proxy, and result in disadvantage to individuals who, by virtue of that status, will be precluded from serving as a Trustee. Given the disadvantageous distinction, these clauses clearly engage the right to freedom from discrimination on the ground of disability. We consider that these provisions are prima facie inconsistent with section 19(1) of the Bill of Rights Act and therefore must be justified under section 5 of that Act.
JUSTIFICATION UNDER SECTION 5 OF THE BILL OF RIGHTS ACT
12. Where a Bill is found to be prima facie inconsistent with a particular right or freedom, it may nevertheless be found to be consistent with the Bill of Rights Act if the inconsistency is considered to be a reasonable limit that is justifiable under section 5 of that Act. The inquiry under section 5 is essentially two-fold:
• does the provision serve an important and significant objective, and
Important and Significant Objective
13. The objective of the Bill is to implement new governance arrangements for Eden Park in order to facilitate the redevelopment that is necessary in advance of the 2011
Rugby World Cup. It appears that the specific objective of clauses 20.8 and 20.9 of the trust deed are to ensure that only individuals who are competent may serve as
Trustees of the Trust Board. This is reinforced by the proximity of other provisions, which disqualify individuals from serving as Trustees on the basis of bankruptcy or
criminal conviction.
14. Accordingly, for the purposes of this advice, we have concluded that the purpose of the Bill is a significant and important objective.
Rational and Proportionate Connection
15. For the provisions to be justified, however, there must be a rational and proportionate connection between the objective and the means through which it is to be achieved. In assessing whether disqualifying individuals from serving as a Trustee on the basis of ‘mental disorder’ under MH(CAT) or an order under the PPPR achieves the objective of ensuring competence of Trustees in a rational and proportionate manner, we have regard to:
• whether the proposed measures will meet their goals effectively, and
Status as ‘mentally disordered’ under MH(CAT) as a proxy to determine competence to serve as a Trustee
16. A Trustee appointed under the trust deed is empowered to exercise all of the rights, powers and privileges in relation to assets of the trust and required to exercise the care, diligence and skill required of a prudent trustee. This requires the competence to make financial and investment decisions regarding trust assets and to resolve all issues that arise in the course of administering the trust. The question, therefore, is
1 In applying section 5, we have had regard to the guidelines set out in R v Hansen [2007] 3 NZLR 1 (SC); Ministry of Transport (MOT) v Noort [1992] NZCA 51; [1992] 3 NZLR 260; Moonen v Film and Literature Board of Review [1999] NZCA 329; [2000] 2 NZLR 9; Moonen v Film and Literature Board of Review [2002] NZCA 69; [2002] 2 NZLR 754 and Supreme Court of Canada’s decision in R v Oakes (1986) 26 DLR (4th).
whether an individual is unable to perform these functions merely by virtue of her or
his status as ‘mentally disordered’ under MH(CAT).
17. The definition of ‘mental disorder’ under MH(CAT) has both broad and limited components. The definition is broad in the sense that it applies to a wide range of mental abnormalities, whether intermittent or continuous in nature. The definition is limited in that it only applies where a particular abnormality poses a serious danger to the safety of self or others, or results in a seriously diminished capacity of self-care.
18. This definition represents an attempt to move away from ‘identity-based’ criteria where individuals are defined by their identity as mentally ill persons. The goal is to prevent negative labelling and decisions based on irrelevant grounds that are inherent in identity-based criteria. An individual’s status as ‘mentally disordered’ under MH(CAT) is not meant to determine her or his capacity by reference to other legislation.
19. In practice, classification as ‘mentally disordered’ can serve as the basis for a compulsory treatment order under MH(CAT). These orders are tailored to the particular circumstances of the case and the specific danger or diminished capacity identified. Often, the determination of danger to oneself or capacity of self-care is independent of an individual’s general level of functioning and achievement in the community, for example in cases involving individuals suffering from bulimia or those who fail to comply with directions to take life-supporting medication (e.g. insulin). The legislation contains a spectrum of orders of varying degrees of severity (including community based treatment orders) and assumes the capacity of individuals subject to the Act to make decisions in a number of areas.
20. We consider that it is inappropriate to adopt the test for ‘mentally disordered’ under MH(CAT) as a proxy for competence to serve as a Trustee. The MH(CAT) test relies on statutory criteria promulgated for other purposes, including criterion (such as dangerousness) irrelevant to the question of whether an individual has capacity to make decisions relating to the administration of a trust. Further, many individuals who are ‘mentally disordered’ under MH(CAT), and even subject to compulsory treatment orders, may nonetheless be competent to fulfil the functions of a Trustee. Therefore, the use of ‘mental disorder’ as a proxy in clause 20.9(d) (and, by reference, clause
20.8(d)) of the trust deed is neither sufficiently related to the objective of ensuring competence nor is it adequately tailored to achieve that goal in the least restrictive manner.
21. In 2007, in respect of the Auckland Regional Amenities Funding Bill (the ‘ARAF Bill’), we considered a similar provision, under which a member of a funding board would be automatically removed where she or he became subject to a compulsory treatment order made under MH(CAT). The use of a compulsory treatment order as a proxy for capacity to carry out the duties of a Board member was considered to be unjustifiably discriminatory under the Bill of Rights Act. That advice formed the basis of the Report of the Attorney-General under section 7 of the Bill of Rights Act on the ARAF Bill.
22. It bears noting that the provision at issue in the ARAF Bill was narrower in scope than clause 20.9(d), in that it required the imposition of a compulsory treatment order before an individual was removed. Clause 20.9(d) disqualifies an individual from serving as a Trustee based merely on her or his status as ‘mentally disordered’ under the MH(CAT), whether or not a compulsory treatment order has been made. The link
between an individual’s status as ‘mentally disordered’ under MH(CAT) and her or his ability to serve as a Trustee is even more tenuous and therefore subject to greater scrutiny.
23. In addition, the High Court rules were recently amended to remove the use of a person’s status as subject to a compulsory treatment order under MH(CAT) as a proxy for legal capacity. The Rules Committee accepted the joint statement of the Director of Mental Health and the Chief Advisor, Disability Services, that ‘it cannot be assumed that all individuals who are compulsorily detained under the [MH(CAT)] will be legally incapacitated’.2
24. Most recently, Parliament enacted the Disability (United Nations Convention on the Rights of Persons With Disabilities) Act 2008 (the ‘Disability Act’), which amended a number of Acts to remove an individual’s status as ‘mentally disordered’ as a proxy for capacity to serve in a variety of public functions.3 One of the primary purposes of the Disability Act is to ensure that New Zealand legislation is consistent with its international obligations under the United Nations Convention on the Rights of Persons with Disabilities and to enable ratification of that Convention.
25. These recent developments underscore our opinion that there is not a sufficient connection between an individual’s status as ‘mentally disordered’ and her or his ability to perform the functions of a Trustee. Further, there is a danger that the use of
‘mental disorder’ as a proxy may exclude individuals otherwise capable of serving as a
Trustee based solely on their disability. As such, there is not a rational and
proportionate connection between the use of ‘mental disorder’ as a proxy and the objective of ensuring competence. Therefore, clause 20.9(d) (and, by reference, clause 20.8(d)) cannot be justified under section 5 of the Bill of Rights Act.
The existence of an order under PPPRA as a proxy to determine competence to serve as a
Trustee
26. The use of an order under PPPRA as a proxy to determine competence to act as a
Trustee presents a slightly different issue than the use of an individual’s status as
‘mentally disordered’ as a proxy. Unlike MH(CAT), the PPPRA is targeted toward a
determination of an individual’s capacity to carry out specific functions with respect to her or his personal and property interests. Such orders affect individuals who lack capacity by reason of their disability. The question is whether an order under the
2 Parliamentary Counsel Office Memorandum Re: High Court Rules r82 – incapacitated persons (27 April
2006); The Rules Committee Circular No. 77 of 2006: Minutes of Meeting held on Monday 3rd of July
2006 (10 July 2006).
3 For example, the Education Act 1989 (eligibility to serve as a trustee), Motor Vehicle Sales Act 2003 (eligibility to register as a motor vehicle trader), Mutual Insurance Act 1955 (eligibility to serve on a board of directors), New Zealand Council for Educational Research Act 1972 (disqualification from the Council), Public Trust Act 2001 (eligibility to consent to actions of a co-trustee), Reserve Bank of New Zealand Act
1989 (disqualification of the Governor, Deputy Governor and non-executive board members), River Boards Act 1908 (disqualification of board members), Sale of Liquor Act 1989 (disqualification of trust members), Soil Conservation and Rivers Control Act 1941 (disqualification and removal of board members), Taranaki Scholarships Trust Board Act 1957 (removal from Board) and Te Ture Whenua Maori Act 1993 (disqualification and removal of board members).
PPPRA is sufficiently related to an individual’s ability to perform the functions of a
Trustee that it serves as an appropriate proxy.
27. Orders under PPPRA are based on the objective of least restrictive intervention. For this reason, orders will typically be issued only where an individual has been determined to lack capacity, wholly or partly, to manage her or his affairs and will be tailored to the specific matters over which the individual lacks competency. Most PPPRA orders are issued after notice and a hearing, and, if practicable, the views of the individual to be subject to the order are ascertained.
28. However, the PPPRA also permits the issuance of interim or temporary orders on an urgent basis pending the outcome of an application for a long term order. An individual may be unaware of the application or the hearing and has no right to be heard, or call or cross-examine witnesses. The test to be applied is also a lower threshold and requires only reasonable grounds to believe the individual may be incompetent. Further, interim or temporary orders are only in place pending the outcome of an application for long term order. If the application for a long term order is denied, the individual will no longer be subject to any order under the PPPRA.
29. In July 2008, we considered, along with the Crown Law Office, whether the use of PPPRA orders in the Disability Act is an appropriate proxy to determine capacity to carry out a variety of public functions. The Disability Act amended a number of existing Acts to remove an individual’s status as ‘mentally disordered’ under MH(CAT) as a proxy for capacity and instead insert a test that relied on the issuance of one or more orders under the PPPRA. The Disability Act did not, however, use the issuance of any order under the PPPRA as an automatic and permanent disqualifier from a public office or function. In particular, the Disability Act clarified that, where an individual is removed from a position based on the issuance of a temporary order, the removal is treated as a leave of absence pending the outcome of an application for a more permanent order.
30. In our collective opinion, the need to remove individuals from public office for incompetence is an important and significant objective and the use of PPPRA orders in the manner specified in the amendments is rational and proportionate to that goal. Central to our opinion was the fact that temporary orders are not used as a basis to permanently remove individuals from public office.
31. Clause 20.9(e) (and, by reference, 20.8(d)) of the trust deed disqualifies an individual from serving as a Trustee if she or he is subject to any order under the PPPRA. Unlike the provisions in the Disability Act, these clauses do not distinguish between temporary and long term orders or provide for the temporary disqualification of a Trustee pending the outcome of an application for a long term order.
32. We consider that there is a sufficient link between competence to act as a Trustee and the ability to communicate choices, understand relevant information, appreciate a situation and rationally manipulate information. As such, the use of long term personal and property orders under the PPPRA as a proxy for capacity may be a justified limitation on the right to be free from discrimination.
33. However, we consider that the use of interim or temporary orders as a proxy for competence is not sufficiently related to competence to justify the limitation on the
right. A temporary or interim order is not subject to the same procedural safeguards as a long term order and does not require a determination that an individual lacks capacity over her or his affairs. Rather, these orders are provisional measures put in place pending a hearing and determination of capacity. Further, an interim or temporary order is no guarantee that a long term order may follow.
34. As such, clause 20.9(e) (and, by reference, clause 20.8(d)) is overly broad and may operate to disqualify individuals who are nonetheless competent from serving as a Trustee. For example, an individual who becomes subject to a temporary order under PPPRA while serving as a Trustee must be permanently removed from the position and there is no provision for reinstatement in the event the application for a long term order is unsuccessful.
35. For this reason, the use of a PPPRA order as a proxy for competence to serve as a Trustee is not sufficiently tailored to achieve the objective in the least restrictive manner. Given the lack of a rational and proportionate connection between the use of a PPPRA order as a proxy and the objective of ensuring competence, clause 20.9(e) (and, by reference, clause 20.8(d)) cannot be justified under section 5 of the Bill of Rights Act.
CONCLUSION
36. Based on the analysis set out above, we have concluded that the Bill appears to be inconsistent with section 19(1) of the Bill of Rights Act and that the inconsistency cannot be justified under section 5 of that Act. Accordingly, we recommend that, as soon as practicable, you bring it to the attention of the House of Representatives pursuant to section 7 of the Bill of Rights Act.
Jeff Orr
Chief Legal Counsel
Office of Legal Counsel
Helen Wyn General Manager Public Law
In addition to the general disclaimer for all documents on this website, please note the following: This advice was prepared to assist the Attorney-General to determine whether a report should be made to Parliament under s 7 of the New Zealand Bill of Rights Act 1990 in relation to the Eden Park Trust Amendment Bill. It should not be used or acted upon for
any other purpose. The advice does no more than assess whether the Bill complies with the minimum guarantees contained in the New Zealand Bill of Rights Act. The release of this
advice should not be taken to indicate that the Attorney-General agrees with all aspects of
it, nor does its release constitute a general waiver of legal professional privilege in respect of this or any other matter.
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