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Sympathy for the CJ ( as the Supremes take on property rights, race politics and the constitution)

  • February 18th, 2013

Many ask for predictions of the Supreme Court's decision on the Waitangi Tribunal/Maori Council's case to hold up hydro generator share sales. 

If iPredict had a contract on the outcome I'd buy a judicial spanner in the government's works at under 0.20.  I'd have paid only up to 0.15 until the Court announced it would take longer for the decision than earlier expected. I wonder why iPredict doesn't have a contract on just the kind of puzzle that prediction markets are good at. 

Many have put significance on the Chief Justice's enquiry about selling only 25% of the hydro generators. Andrew Geddes on that correctly warns that judges often ask about hypotheticals to draw out counsel's reasoning. He makes the call that they will not overturn the robust decision of the High Court. Obviously I think Geddes is more likely to be right than not, but we should prepare for the unexpected. A hold-up decision would be a classic Taleb 'black swan'. It could cost enough to make that risk a matter for careful preparation.

Given the opposition's cynical exploitation of anti-sale sentiment, a decision against the government will pitch the Court into politics. Though unfair it could precipitate a new low in public (and government) respect for the Supreme Court.  Matthew Hooten's NBR satire works because of its references to past unwise judicial inventions. 

But if the Court adopts certain arguments to trash the governmet's timetable I 'd be obliged to defend its intellectual integrity and courage, despite my view that the government should prevail. The government does not deserve to win. That is no reflection on the quality of its counsel. The Crown case has been undermined by years of its own illogic and disrespect for legal principle and property rights. The Crown has been acknowledging Maori property interests in fresh water for generations but never moved to define or recognise or protect them. This weekend's Insight by Lois Williams' superbly surveys the evidence in support of that part of the Maori Council's argument. 

And the Crown has never put the only real counter-arguments I can see.

 Instead the PM has been parroting the nonsense that water is 'common property'. That is all the evidence the Supreme Court might need that the government cannot be trusted to uphold the classical property rights promised by Article 2, without a gun to the head. The Supreme Court judges could also (but will not) point to the legal drivel embodied in the Marine and Coastal Area Act and reflected in signing the UN's Draft Declaration of Indigenous Rights. Both show a Crown willingness to sacrifice our legal inheritance ( law that pursues certainty, so that people can know what it means without relying on rulers to tell them) for temporary political expediency. Worse, their well meant favouring of the Iwi Leaders can also be seen as collusion with arisocratic Maori who will profit from the confusion and muddy claims that accompany uncertain and temporary claims in property. The Treaty tried to protect against that kiind of elite sell out of the ordinary people, with the now ignored Crown rights of pre-emption.

It is proper for the courts to protect the citizen from the Crowns depredations on property rights. There is evidence that the Crown intends murky deals on water with our equivalent of Fiji's Great Council of Chiefs. So the Supreme Court could do us all a favour in the long term by pointing out that the Treaty conferred property rights, not use licences for the politically well connected. If calling a halt restores respect for principled consistency in government on property rights, equality before the law, certainty and other elements of our rule of law inheritance, the budget impact of an asset sale failure could be a reasonable cost to pay.

On the other hand, if Supreme Court meanders half baked into the NZMC's 'stakeholder' reconstructions of  company law, it will deserve the odium it will get.

And would calling taiho on the sales be that bad? It is probably a bad time to sell anyway. Who knows how to price these assets, with fracked gas transforming world energy markets, and the possibility of scaled back aluminium smelting. If uncertainty means the sale price is too cheap in hindsight it will taint privatisation for another generation. If they sell too high, in hindsight, there will be endless recrimination from the greedies who will claim to have been mislead.


  • peterquixote
  • February 23rd, 2013
  • 6:56 pm

the water and some high land belongs to all of New Zealanders, we resent the loss of our coastal land to specialist racial
groups, watch us recover and fight, we are ready now

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