KIWIS FIRST

N.Z. SOLICITOR GENERAL SEEN BY OTHER NATIONS AS INEPT AND RECKLESS

14 February 2008
What happens when you are the highest legal official in the country and, in your first year in office, you create an international incident, file two Crown legal actions that ignore basic laws, submit a perjured affidavit to the Wellington High Court and use your public office to prosecute your political opponents?  If you are the NZ Solicitor General David Collins, you get a pay raise.

Now that the United Nations has launched an investigation into Human Rights abuses resulting from New Zealand's ill-fated terrorist raids last October (when more than a dozen NZ citizens were held without bail for a month), businesses, and even tourists, are choosing to stay away from New Zealand.  Few Kiwis realise - as many of our allies abroad now do - what a disaster Mr Collins' appointment last year as Solicitor General has been for the rule of law in New Zealand.  Growing numbers of Justice officials from Canada to Australia can do little but scratch their heads over what is occuring here, while wondering what could possibly happen next. story continued
RELATED STORY- COLLINS MOVES TO BANKRUPT MOODIE ( 26 January 2008) 
In what many in the legal profession consider a disgraceful abuse of power, New Zealand Solicitor General David Collins has filed bankruptcy proceedings last month against Feilding Barrister Dr. Rob Moodie in the Palmerston North High Court.  READ STORY

JUDGE JUDY'S RESOLUTE MARCH TO PERDITION

7 September 2007, Auckland
Where it all began no one seems to really know.  Nevertheless, what is clear is that somewhere in New Zealand's recent history a couple lawyers with strong personal agendas were appointed judges, no one seemed to mind, these judges got their mates appointed judges, still other judges took notice of the public apathy, and a systemic case of the inmates taking over the judicial asylum eventuated.  

Frequent readers will be aware that Terrence Arnold was more than a year ago appointed directly from practicing lawyer to Court of Appeal judge after being caught out concealing evidence in a wrongful prosecution he undertook from the Solicitor General's office in the Berryman Bridge debacle.  No one blinked that in any other law-respecting country such unlawful conduct would have landed Mr. Arnold in prison.  The moral of the story is that public apathy and lack of effective judicial oversight on Court appointments remains the status quo, much to the detriment of New Zealand's otherwise fine reputation around the world.
 
In the most recent example of we get only the minimum of what we are willing to accept from judicial appointees, Auckland High Court Judge Judy Potter recently subverted essential legal rights afforded the accused in, not one, but two cases.  Today the Court of Appeal ordered a new trial in the high profile Antonie Dixon murder case as a result of judicial misconduct by Potter.  The situation with the judge has gotten so out of control that the Court of Appeal suppressed its reasons for overturning the Antonie Dixon murder trial where Potter was judge.  Prominent defence barrister Barry Hart of Auckland brought the appeal to the appellate court on the basis that Judge Potter's actions directly resulted in a gross miscarriage of justice.  Ironically the Court of Appeal used this same excuse for NOT divulging exactly the extent of the judicial misconduct it also found.   This action is virtually unprecedented considering the Court of Appeal's reasoning equates to high ranking precedent relied on as a guide to not only identify abuses and reinforce the law of the land but to foster lawful compliance of essential laws in the future.  

In a 2006 informal survey of Auckland lawyers who appear in court, Potter was overwhelmingly mentioned as the High Court judge least respected.  The primary reasons given were her disrespect for the rule of law and her emotional behaviour on the bench.   

The Court of Appeal finding against Potter - and subsequent suppression of their reasoning for it - comes on the heels of another case in July 2007 where Judge Potter created new case law (Stiassny v Siemer CIV2005 404 1808).  In the Stiassny case, Potter ruled that New Zealand judges may imprison civil litigants ahead of any substantive trial based solely on hearsay evidence, while preventing the accused from cross-examining those providing the hearsay evidence against them - and even the right to be present at the hearing.  She claimed in her decisions that judges had this power by right where actions were progressed through less formal 'interlocutory applications'.

As a legal bureaucrat much of her long professional life, including a stint as President of the New Zealand Law Society, Ms. Potter has fomented political clout that she is increasingly exploiting as she approaches the end of her legal career.  Many see her recent actions as a dangerous indication that she has lost all objectivity.  In a 2005 case which was covered-up at the time by the Head of the Auckland Bench, it was revealed Potter ruled on behalf of  her brother-in-law in another case without mentioning her relationship.  This she did despite certain legal guidelines that required her to remove herself from the proceedings.  The fear is Chief High Court Justice Randerson's protection of Potter in that case appears to have not only emboldened Potter but also created the risk that other judges aware of the dispensation granted Potter will now not hesitate to preside in cases where they have a personal interest in the outcome.  (Those doubting Potter's involvement in cases concerning close family members should check this evidence out).
 
Having been exposed for breaching fundamental legal protections afforded the accused in two recent cases, Ms. Potter began calling in favours from her judicial mates as the first appeal went to the Court of Appeal, and eventually to the New Zealand Supreme Court.  In the Stiassny matter, Justice Willy Young for the Court of Appeal refused to consider the established rules of evidence as relevant, saying the judge used appropriate discretion in denying cross-examination and relying on hearsay evidence because the application to imprison had been filed as an 'interlocutory application'.  This new legal exemption created by Mr. Young less than six months ago is reasonably expected to result in future applications for imprisonment being filed as interlocutory applications now that the Court of Appeal has said indispensable rules of evidence do not apply in such cases. 

Such disgraceful lawlessness is not going unnoticed overseas.  Our closest ally, Australia, has pointedly stated that their refusal to send accused to New Zealand to stand trial is because they would not get a fair trial here.   This happened in 2005 in the widely publicised case of two defrocked priests wanted by New Zealand authorities on charges of sexual abuse.
 
On 12 July 2007, Justices Tipping and McGrath, speaking for the New Zealand Supreme Court, refused to consider an appeal of Judge Potter's and the Appellate Court's circumvention of basic legal rights - rights which both the United Nations Charter and the World Court have made central to their human rights platforms.  Once again, the NZ Supreme Court ruled that it was not required to consider the legal contraventions because the application to imprison had been advanced as an 'interlocutory application'. 
 
An interlocutory application is defined by the Court as an ancillary proceeding to a central claim.  As such, interlocutory matters are considered less formally and the presiding judge is given the broadest discretion to deviate from and obfuscate fundamental legal restraints.  Adding to the danger for abuse is the ability of the presiding judge to prevent attendance by members of the public as well as accurate recording of interlocutory hearings.  This potential for abuse is impossible to understate.  The upshot of the Courts' ruling is that wealthy and prodigious litigators have now been granted license by New Zealand highest courts to simply file a fabricated claim, then refuse to advance the case as they file endless applications in an abuse of process designed to wage a war of financial attrition against, and unduly destroy, the opposing party.  Unquestionably this is what Stiassny has done, having failed over almost 2 ½ years to advance his central claim of defamation against Auckland businessman and Kiwisfirst editor Vince Siemer.  The implication of the recent rulings is that the Courts will invariably fall deeper into the domain of only the most affluent and unscrupulous protagonists, with natural justice denied many worthy parties whose only failing is that they do not possess the substantial financial means to "buy" justice.  The pressing question then will be where law-abiding citizens are to go to obtain justice if not the Courts.  Until recently New Zealand had the Privy Council to go to, but no longer.
 
The absolute power that judges exercise in New Zealand is unbridled by law in practice (as it is elsewhere).  For example, Judge Potter's refusal to recuse herself from proceedings where the civil defendant and his first lawyer (Colin Henry J.D.) both had formal complaints of judicial misconduct pending against her would flatly not be allowed anywhere else in the free world.  But Potter simply decreed these obvious conflicts of interest were irrelevant.  Ms. Potter's audacious ruling on behalf of her brother-in-law in a previous case without even disclosing her relationship is even worse.  Mr. Siemer's replacement lawyer, Mr. Grant Illingworth QC shared similar views on Potter, calling her "the worst" and "an embarrassment to the Court", then went on to say of her "When she gets a bee in her bonnet, the law doesn't matter".
 
Not surprisingly, many - but not all - of the cases Ms. Potter rules to be exceptions to the law involve parties she has close ties with.  Before being appointed to the High Court, Judy Potter had business and social connections with Mr. Stiassny.  She stills runs with the same close-knit circles.  Throughout the appeals to her ruling, Potter J took an active and interested role, personally seeking and acquiring a copy of the Supreme Court's refusal to hear the appeal of her ruling by 10:00 am of the day of issue.  This personally vested approach does not surprise lawyers who know her (or the readers who have read the previous paragraph).  Judy Potter J is an unmarried 65 yr old former commercial partner with Kensington Swan who currently lives at 15 Domett Ave, Epsom, Auckland.  She is one of the few judges who is listed in the phone book.  She has no children.  It is no surprise then that she had demonstrated no interest in protecting the sanctity of the law for future generations. 
 
In the one degree of separation that is the New Zealand Judiciary, Ms. Potter's other claim to infamy this year is that she acted as the Court of Appeal substitute judge who found Feilding barrister Rob Moodie guilty of contempt of court for exposing Mr. Arnold's alleged criminal conduct in withholding evidence in the Berryman Bridge case.  Perversely, it is this willingness to step forward on the legal hatchet jobs that holds her in good stead with fellow judges and creates political capital for her to spend later.
 
At least two other appeals of unrelated Potter rulings are currently before the Court of Appeal.  Noting the large number of her rulings that are appealed, one lawyer joked that no Court of Appeal judge will be made redundant for lack of work as long as she remains on the bench.  If an exemption is not granted, Potter faces mandatory retirement in less than two years time (age 67).  For the law-respecting public, this day cannot come soon enough.   BACK TO FRONT PAGE

JUDGE JUDY POTTER BREAKS ANOTHER FUNDAMENTAL LAW.

Below is a copy of a 27 June 2005 letter from High Court Chief Justice AP Randerson in response to a formal complaint from an Auckland barrister against Judge Judy Potter for ruling in a case where her brother-in-law was a defendant and where she ruled (in favour of her brother-in-law, of course) without merely disclosing this very close family relationship to the plaintiffs. 

How is this possible?  In "The Land of the Long White Shroud" that is the New Zealand Courts, anything is possible for a family member or a mate.  Note that Chief Justice Randerson rules " I do not see anything improper in Potter J dealing with the application without disclosure of any family connection with the first defendant,"  adding  "the order she made was entirely procedural in nature."  

Did the "Honourable" Head of the Bench and patron saint of dishonest judges just rule that it is okay as far as he is concerned for a judge to rule on procedural matters involving close family members?   Yes he did.    Fellow citizens, we have a serious problem!  You have a right to know this is occuring in our courts.  It is also fair to ask why the mainstream news media are not printing stories of this complicit corruption that affects us all.

[PARAGRAPH DELETED BY ORDER OF THE OFFICE OF THE SOLICITOR GENERAL OF NEW ZEALAND.  EMAIL HIM AT david.collins@crownlaw.govt.nz TO FIND OUT WHY YOU ARE NOT ALLOWED TO READ THIS]

Back to Potter story

COURT PRESIDENT TOOK 'BRIBE' TO PROTECT VECTOR CHAIRMAN

15 September 2009
Court of Appeal President William Young accepted financial assistance in exchange for defeating the course of justice in 2007.  FULL STORY

DRIVEN TO DESPAIR

10 August 2009
One woman's nightmare with two bad lawyers exposes problems within the closed shop fraternity, leaving nowhere to turn for justice, and despair for life itself.  READ STORY

THE INDIVISIBLE CROWN -
Why NZ Citizens are Outcasts in their own Courts

23 July 2009 
The Judicial and Crown law oath starts with allegiance to the Crown and to do right by all people.  But what happens when these allegiances conflict?  In recent years, a substantial body of case law has evolved within New Zealand which asserts rights which conflict with the interests of the Crown (defined as government entities and those acting on behalf of those entities) are to be subjugated.  READ STORY

NEW ZEALAND SUPREME COURT GUTS JUDGE DISCLOSURE LAW

6 July 2009
In an unprecedented judgment from the New Zealand Supreme Court Friday, the full court declared New Zealand Judges are not required to disclose their personal and business relationships with those who appear before them if it is not evident those Judges stand to personally benefit from their subsequent ruling.  Story Continues

NEW ZEALAND SUPREME COURT LEGALISES DISCOVERY EXEMPTIONS

21 May 2009 
The New Zealand Supreme Court has dismissed a legal challenge to a 2004 High Court rule change which exempts parties to litigation from discovery disclosure.  The full bench ruling [ SC 62/2008 [2008] NZSC 98 and 24 February 2009 (unpublished)] endorsed the effect of this new rule allowing parties to avoid identifying their discovery documents.  
 
The dour effect of the relevant Rule change on discovery law had been discussed in Sim's Court Practice (NZ): "The documents in the first (open) part do not need to be individually described. Each document should be numbered and the affidavit will simply refer to the range of numbers."    STORY CONTINUES

LOSS OF HONOUR

11 April 2009 
On 30 March 2009, the nascent New Zealand Supreme Court officially ruled the Magna Carta and the Judicature Act 1908 were subjugated by "Judicial discretion" in New Zealand. READ STORY 

ASHER LATEST JUDGE TO CONTRAVENE PUBLIC RECORDS ACT

8 March 2009
In a landmark case concerning disclosure responsibilities of local councils on ratepayer-funded expenditures, Auckland High Court Judge Raynor Asher refused twice this week to release a High Court transcript for use in an appeal.  READ FULL STORY

AUCKLAND COUNCIL ONE OF MANY SKIRTING PUBLIC RECORDS ACT

3 Febraury 2009
Public Watchdog Penny Bright is expanding her fight to Parliament to force Auckland City Council to disclose in its annual report what individual contractors are being paid.  Last year Ms Bright formally disputed her rates until the Council revealed where $850 Million spending on outside contractors went in fiscal 2007.  Ms Bright lost a resultant action brought against her by the Council in the District Court.  Her appeal is now before the High Court.

Spurred by the discovery last year that Deputy Mayor David Hay holds trust shareholding in City contractor Eco Cover NZ Ltd and that many other local councils are plagued with conflicts of interest, Ms Bright is now seeking to use the Public Records Act 2005 and press Parliament into ammending the Local Governments Act 2002 so as to compel all councils throughout New Zealand to list details of payments to outside contractors in their annual reports.  Public keen to support such a measure can download the appeal petition.

THE VANISHING JURY IN NEW ZEALAND

14 June 2008
On a practical level, jury trials are becoming extinct in New Zealand.  The last civil trial by jury was granted in 2004.  Judges are also putting pressure on lawyers and Parliament to curtail use of criminal juries. So far, the move away from juries has come without changes to the law.  READ STORY

STIASSNY SICKS LAWYERS ON TVNZ IN ATTEMPT TO STOP PROGRAMME TO AIR

26 October 2008
Auckland Insolvency accountant Michael Stiassny wages offensive to prevent tonights' TVNZ Sunday Programme segment on his 4 year old defamation suit against kiwisfrist Editor Vince Siemer from airing - threatening to bring yet another defamation suit against TVNZ.  Stiassny had earlier declined TVNZ's request to give his side to the story as to why he failed to advance his defamation claim after obtaining a High Court gag injunction against Mr Siemer so many years ago.  FULL STORY

JOHN KEY SUBJECT OF INSIDER TRADING COMPLAINT to SERIOUS FRAUD OFFICE

10 October 2008
Public Watchdog Penny Bright filed a well supported complaint to the Serious Fraud Office this week against National Party Leader John Key for using his Parliamentary position to obtain inside information on Tranzrail's fortunes in 2003, at a time he was a shareholder of the company OUTSIDE LINK TO STORY

Solicitor General Collins Mocks Fair Trials and Public Right to Know at Dominion Post Contempt Trial

16 September 2008
Solicitor General David Collins opened with a bang yesterday in the Crown's prosecution of the Dominion Post for contemptous breach of a court suppression order in the ill-fated Crown prosecution of so-called 'terrorists' last year.  Learn why this evidence in a case which was long ago dropped is deemed dangerous for the public to know about.   FULL STORY

Bill Wilson's Private Appointment to Supreme Court a Lesson to Public

4 September 2008 
"Friends of Bill W" is taking on a new meaning after the meteoric rise of Bill Wilson (right) to the New Zealand Supreme Court bench this year. 
 
Less than two years ago, Mr Wilson was sitting in his law office trying to figure out where his next paying client was coming from.  Not that Wilson needed the money.  His Rich Hill Stud Farm - which he owned with fellow Queen's Counsel Alan Galbraith - was printing money.  Compared to this, his new $400,000 yearly salary as a Judge could be considered a paltry sum, even if Justice Wilson now gets chauffered around Wellington in a limousine and has all his lunches catered.  As odd as this promotion is in the annals of history, the real mystery is finding out any details on exactly how Mr Wilson was vetted in the selection process to Supreme Court.  Read full story

NOT ON MY WATCH

25 June 2008
Former Police Prosecutor Grace Haden is making a name for herself as a private investigator exposing corruption and it may prove more valuable to society than her former police role.  READ STORY

AUTHOR ANNE HUNT LAMENTS NZ COURT'S HANDLING OF CONTEMPT CASES USING HER OWN EXPERIENCE

20 June 2008   - by Anne Hunt
The question has to be asked whether contempt of court is becoming a convenient excuse for the Courts to ignore the provisions of the New Zealand Bill of Rights Act.

Section 14 of the Bill of Rights Act says quite clearly that: Everyone has the right to freedom of expression, including freedom to seek, receive and impart information and opinions of any kind in any form.  STORY CONTINUES

STRATFORD RACING CLUB MEMBERSHIP DECIDED BY COURT OF APPEAL

20 May 2008
One experienced racing aficionado sees the move as worrying judicial activism.  Read Full Story

JUDGE JUDY UNDER FIRE FOR ABORTING TRIAL.  Powerful QC Called POTTER J  "An embarrassment to the Court"

27 March 2008
Recent Court events demonstrate why Grant Illingworth QC's remarks that Auckland High Court Judge Judith Potter is "an embarrassment to the Court" were as wise as they were scandalous. Full Story

AUCKLAND CITY DREDGES THROUGH COUNCIL DIVISIONS  (Link to r ate revolt info)

7 March 2008
There is a new guard in charge of Auckland City Council. They are a fierce and determined bunch. In a spirited "Combined Committees" session on Wednesday 5 March, fights over money and politics created banter bordering on a verbal brawl. READ FULL STORY

AUCKLAND RATES RISE; FUNDS GO DOWN TOILET

4 January 2008 
"Where do ratepayer monies go?"  You would be surprised how much this Pt Chev toilet cost (photo next page), how much money goes missing and how much can be spent by Auckland City Council without competitive bidding.  READ STORY

$62 MILLION ANNUAL BUDGET FOR AUCKLAND CONSULTANTS

21 May 2008
A long fought for report from Auckland City shows external consultants may be paid a staggering $62 Million in the current fiscal year - twice as much as three years ago.  Find out how this happened.  Read Story

NZ AUTHOR'S SAD AND SHOCKING SAGA IN THE HIGH COURT CAN NOW BE TOLD

1 May 2008  - After Court of Appeal overturns contempt finding and revokes suppression order of Justice John Wild.  Read Fulll Story

VECTOR TO SELL ASSETS TO PAY DOWN DEBT

20 April 2008 
Line's company Vector is currently in a race to sell off its' "gold plated" Wellington to Auckland transmission lines to pay down its burgeoning debt.  Full Story

DETERIORATION OF POLICE STANDARDS PLAGUES FORCE   

Dateline: 10 March 2008
Less than a generation ago the New Zealand Police endeavoured to increase the quality of its ranks by recruiting more educated and morally conscious constables.  The story of what went wrong.

NEED BETTER WORK STORIES?

25 February 2008
The twelve Police detectives who laid siege to the Gulf Harbour home of Vince and Jane Siemer in the early hours of Thursday morning 21st Feb 2008 can add the intimate details they learned of the family's personal lives to their Friday nights out on the town with mates.  SEE FULL STORY

DEATH AND GREED ON MATAKANA ISLAND

13 February 2008
You get a feeling things are not right when, within 5 days of a man being found incinerated in the back seat of his car - the car crudely parked on an isolated road - the police investigator is claiming suicide.  The primary indicator of suicide is said to be the empty petrol container allegedly used to create the inferno found tucked away in the closed boot of the car.  FULL STORY

JUDGE WILLY IN HOT WATER OVER RIVER DIVERSION

16 January 2008
Retired District Court Judge Tony Willy of Blenheim failed to divulge his financial interest in hydro-generation contractor while ruling in favour of five new, highly-contentious hydro plants on Wairau river.  READ STORY

POLICE DISCHARGE FIRST OF TWO CRIMINAL PROBES AGAINST SOLICITOR GENERAL

20 February 2009
Detective Superintendent Rod Drew completed his eight month investigation into an allegation of perjury against Solicitor-General David Collins with a six page summary which completely exonerated Mr Collins.  

The original six part allegation, made by author and District Councilwoman Anne Hunt, related to an 11 May 2007 sworn affidavit by S-G Collins for Court of Appeal proceedings she was involved in at the time.  It concerned a matter dating back to 2001 when Collins was her lawyer.  In his affidavit, Mr Collins told the Court he had not legally vetted Ms Hunt's book manuscript Broken Silence.  The Wellington High Court had ordered the book banned and copies destroyed for violating a Court suppression order in an earlier case where even the names of the parties were suppressed by Court order .  Collins was also lawyer for that plaintiff, whom the Court abstractly referred to as "M".  The problem arose when Ms Hunt produced the manuscript with David Collins' handwritten notations clearly providing legal advice in the margins. 

Detective Superintendent Rod Drew's investigation conclusions immediately drew fire when he defined his "Method of Investigation" as "not (as) a dispute about what was done, but rather the reason that particular acts were done."  Such methodology took the investigation from a factual finding to the much higher evidential standard of conspiracy to commit a criminal act.  Proving an effective conspiracy to commit an unlawful act is extremely difficult because it requires proof of intent - the hardest thing to prove in a Court of law. 

Kiwisfirst spoke with Det. Supt. Drew today but he refused to comment, referring the caller to the official NZ Police press release http://www.police.govt.nz/news/release.html?id=4810.  He also refused to provide an electronic copy of his six page investigation summary for posting along with this story. 

Ms Hunt's lawyer Steven Price was contacted but replied that he had not seen Drew's summary, which was dated 17 February 2009, so could not comment.

Drew concluded his summary with a statement that he submitted his conclusions to "independent review" by Hamilton barrister Phil Morgan QC prior to releasing them and that Mr Morgan completely concurred with his findings on all six aspects of the complaint.  This is surprising.  For example, on the overriding evidence that Mr Collins perjured himself, Drew began his summary by stating that Ms Hunt's failure to call Mr Collins for "cross-examination" undermined the charge.  He claimed this supported his conclusion "Dr Collins was not afforded the opportunity to be heard".   This was legally and factually inaccurate.  The affidavit stands alone as a record of being heard.  Moreover, Collins could not be cross-examined because he could only be called as a friendly witness.  Hence, he could walk into the witness box and claim to be Cleopatra and the lawyers could not challenge his answers.  No responsible lawyer would call a witness whose answers they cannot trust.

Drew's many other conclusions admittedly were based on a lack of evidence as to intent or the quite plausible conclusion in one case that Collins was honestly mistaken.

Ironically, had Drew found merit in the complaint, he would have had to submit a recommendation for approval to prosecute Solicitor General Collins to Collins' office. 

In his "Final Comment" Drew took a lowbrow and patronizing swipe at Ms Hunt, obviously for putting him in the unenviable position of confronting suspect conduct by the most powerful lawyer in New Zealand at the time of the complaint.  Drew pontificated: "It is clear from the documentation... your mental health suffered.  I hope that completion of this investigation will allow you to put this matter behind you and to maintain good health in the future."  back to front page

DIRECTOR'S DISDAIN DOOMED SERIOUS FRAUD OFFICE

13 December 2007 
Now that the Serious Fraud Office is being disbanded, it has been revealed that much of the culpability for its demise rests with the outgoing Director David Bradshaw and his Machiavellian approach toward prosecutions.  The mounting paradox was that no law stood in the way of Mr Bradshaw and his staff's determined mission of prosecuting 'bad guys'.  The effect was the SFO often acted more egregiously than those they prosecuted.  So systemic was Mr Bradshaw's disregard for established legal constraints within the SFO that he did little to hide his virulent feelings that it was the laws of New Zealand which were the biggest impediments in SFO prosecutions.  His staff mimicked his Rambo administrative style to keep the boss happy.   
 
Mr Bradshaw's bold attempts to circumvent two elementary laws are often cited.
 
In October 2005, Mr Bradshaw issued a briefing paper in which he disparaged the foundation of every jurisprudence system: legal professional privilege.  He wanted legal privilege not to impede the SFO's investigations, saying "My proposal is that the law be relaxed in relation to legal professional privilege to allow the Serious Fraud Office to obtain all relevant documents". 
 
But Mr Bradshaw went much further.  He wanted to circumvent judges as well.  On his stated goal that the SFO be able to seize whatever it wanted from those the SFO investigated he wrote at the time, "The process for having a Judge determine relevancy is fraught with problems as Judges are not fraud investigators nor can they be expected to know the full scope of any investigation." 
 
If this did not scare the beejesus out of law-respecting people, Mr Bradshaw was just getting started.  He has also been a vocal advocate for the last two years that individuals his office suspect of wrongdoing should not have the right to remain silent - and that they should be prosecuted if they do.  He does not consider those accused by the SFO are entitled to rely on civil rights laws.  He infamously called the New Zealand Bill of Rights Act "The Rogue's Charter" in his 2007 report.  In a brilliant stroke of irony, his reason for dismantling the Bill of Rights was rationalized thusly, "There is a strong public interest in ensuring that to the greatest extent possible serious criminal offending is prosecuted and that miscarriages of justice are kept to the absolute minimum."
 
As much as the law apparently got in Mr Bradshaw's way, the abysmal record of the SFO was perhaps the last straw.  Arguably their biggest success story over the last 3 years was the successful prosecution of former Act Party member Donna Awatere Huata for embezzling $80,000.  Meanwhile, the large and truly serious fraud cases were often not being advanced because of personal connections serious perpetrators had within the office.  This effectively insulated some of the most serious offenders from prosecution.  At the same time Robert Fardell QC and Anthony Lusk QC were two legal rogues guilty of serious past legal misconduct who were actually conducting criminal prosecutions on behalf of the SFO.  
 
The politicizing and polarizing culture in the Office cut both ways.  A case now before the Courts concerns a wrongful prosecution alleged against the SFO by Tuariki Delamere, after he was found not guilty in an earlier SFO prosecution which many believe was politically motivated.  
 
Mr Bradshaw's ten year tenure with the SFO put him increasingly in a comfortable position to mold the office into his own image.  He surrounded himself with pliant staff who would follow his lead.  Gus Adolph Andree Wiltens was one such lawyer who rose to the rank of Assistant Director.  On 29 October, Mr Wiltens was appointed Judge in the Manukau District Court.  It will be interesting to see how this appointment helps him in the criminal prosecution by Mr Delamere which names Mr Wiltens personally. [Back to Front Page]

SOLICITOR GENERAL'S DEMANDS EXCEED HIS AUTHORITY

9 August 2007, Wellington
In a blatant abuse of position and legal authority, the new Solicitor General of New Zealand, David Collins, demanded the webhost of Kiwisfirst shut down the website.  The first notice from the Solicitor General was sent on 19 July 2007, claiming to then-host Elighten that the website was defamatory of judges.  This claim and subsequent demand was despite the S-G's authority being limited to initiating due process proceedings  and no documented allegations - let alone determination - of defamation being made.  The host immediately shut down the site but re-launched it four days later after determining the S-G had no authority in law to make such a demand. 
 
Formal complaints regarding the S-G's actions have been filed with the Office of the Attorney General Michael Cullen and a petition asking for an inquiry is being prepared for Parliament.  As this article goes to press, the office of the S-G has not issued a formal response to the allegations of abuse of office.  [RELATED STORY LINK BLOCKED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM  david.collins@crownlaw.govt.nz  TO ASK WHY] 
On 31 July 2007, a further letter was sent by the Solicitor General, this time alleging the website breached an 'interim' injunction that has been in place for more than two years - an injunction that prevents evidence [SENTENCE DELETED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM AT david.collins@crownlaw.govt.nz  TO ASK WHY] by Vector Energy Chair Michael Stiassny being made public.  Mr. Stiassny has failed to advance his defamation claim that underpinned the injunction since it was issued in April 2005.  Recently, the Court of Appeal ignored evidence - evidence furthermore caught on tape - that showed Mr. Stiassny had perjured himself when filing the affidavit required to obtain the injunction.  At least two of Stiassny's former lawyers now sit on the High Court.  Mr. Stiassny has recently become a close business associate of Supreme Court Chief Justice Sian Elias's husband Hugh Fletcher. 
 
In 2005, Mr. Siemer estimated Mr. Stiassny, mainly through his company Ferrier Hodgson, [SENTENCE DELETED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM AT david.collins@crownlaw.govt.nz TO ASK WHY].  Moreover, Siemer uncovered evidence that formal complaints of gross financial misconduct against Stiassny by some of New Zealand's most talented inventors and business people dating back 15 years were regularly buried in complaint committees, often with the assistance of a couple powerful officials within the Bank of New Zealand. 

Mr. Stiassny made his personal fortune as an insolvency practitioner and Mr. Siemer, who himself holds an MBA degree and is a successful businessman with interests here and in the United States, has staunchly maintained that his investigation into Mr. Stiassny's business record has revealed a troubling ineptitude in managing productive enterprises - all of which pose significant ongoing risk to the New Zealand public.
 
Since these revelations began to surface Mr. Stiassny has been kicked off the boards of Met Life and Metrowater Ltd.  While Mr. Stiassny has brutally held on to his chairmanship of Vector, it has come at a significant cost to the Country with the three most experienced directors on the Vector board resigning en-masse last December, and the CFO and CEO both resigning in the last three months.  All cited conflicts with, and lack of confidence in, Stiassny as a significant factor in their departures. 

It was reported that the departing directors noted Stiassny's litigious ways.  On this point, Siemer says Stiassny is not only the single greatest patron of the Courts but extremely blessed by gratuitous judgments that defy legal reasoning in many cases.  Stiassny's court largesse and lawyer-turned-judge relationships will be detailed in a book Siemer plans to publish next year..
 
Vector is the monopoly electricity lines company for Auckland and Wellington. #

MANY LEGAL ISSUES LOOM IN DISTRICT LAW SOCIETIES' FINAL DAYS

Dateline:3 June 2007
The Lawyers and Conveyancers Act 2006 spells huge changes for district law societies Read Story

SOME OF NEW ZEALAND'S TOP JUDGES HEAVY IN DEBT DESPITE LARGE SALARIES

Dateline:1 May 2007
There is escalating fear that increased personal debt among some NZ judges is leaving the judiciary ripe for bribes and scandals on a scale never seen before.  How serious is the problem and what if anything is being done to protect the public?  read full story

HIGH COURT JUDGE WILLIAMS FORCED OFF LEGAL NEGLIGENCE CASE

Date published: 12 March 2007
In a procedural victory for the shareholders of Paragon Services Limited and Gulf Harbour couple Vince and Jane Siemer,  Justice Hugh Williams has been compelled to remove himself from presiding over their trial against the estate of the late Auckland Barrister Robert Fardell QC.  Like Fardell, Justice Williams is also a Queen's Counsel ( link to history of Queen's Counsel).  The case involves a civil claim for upwards of $2,000,000 damages allegedly suffered by the plaintiffs as a result of Mr. Fardell's wrongful advice.  The claim stems from Mr. Fardell's advice to the Plaintiffs in December 2000 to petition the High Court for receivership protection of Paragon against an imminent theft of intellectual property valued at $750,000.  The company had no debt at the time.  
 
The plaintiffs allege that after they agreed to Fardell's advice to put the company into the hands of prominent Auckland insolvency practitioner Michael Stiassny, no effort was made to recover the intellectual property that went missing.  Instead, Fardell and Stiassny together racked up over $150,000 in fees, a significant portion of which were subsequently labeled as errors by Stiassny after Siemer challenged them.  Court records show Stiassny ***CONTENT CENSORED BY ORDER OF THE NEW ZEALAND GOVERNMENT***.  Siemer says Stiassny then pressed the plaintiff directors to agree to liquidation.  The directors refused, instead petitioning the High Court to revoke Stiassny's appointment, which it did on 18 July 2001. 

The plaintiffs filed suit against Fardell when they discovered a year later that Fardell and Stiassny were business partners and Stiassny was a long-time friend and client of Fardell, facts neither man had disclosed.   Stiassny and his company Ferrier Hodgson are not named in the action, as the plaintiffs had acted on Fardell's advice that they needed to sign an agreement absolving Stiassny and Ferrier Hodgson of legal liability before Stiassny would agree to return company assets - this after the Court revoked Stiassny's receivership.  Nonetheless, Ferrier Hodgson have since provided an affidavit in a related defamation suit Stiassny filed against Siemer saying they were unaware as to the exact role they were to play in the receivership debacle, claiming to have received only a copy of the court decree as their instructions.

The case has been on foot in the High Court since October 2003.  Two weeks after the plaintiffs presented evidence to Justice Williams (in December 2005) that Mr. Fardell had three times perjured himself in the case, Fardell apparently fell off the 15 meter high Takapuna Head cliffs near his home at high tide.  The coroner's report into the apparent suicide has subsequently been suppressed by order of the Court.  Since Fardell's death the plaintiffs allege Justice Williams repeatedly obstructed the advancement of their case, claiming to lose filings and refusing to rule on procedural matters where the rules favoured them.   
 
After repeated complaints to Chief High Court Judge Randerson and a formal application being filed with four affidavits in support of Justice Williams' forced recusal from the case, Williams agreed in October 2006 that he would step aside in favour of a judge from outside the Auckland district, but 4 1/2 months on he had failed to do so.  Matters came to a head at the latest hearing on 19 February 2007 after Williams sought to scale back obviously padded invoices submitted by Stiassny's lawyers more than 80% rather than dismiss them out of hand.  The plaintiffs have appealed that decision to the Court of Appeal, but now require leave of the High Court for that appeal to be heard.  In a Minute issued the next day, Williams finally agreed to allow Justice John Hansen to hear further matters in the case.  

In 2002, according to the National Business Review, Williams, age 67 and originally from Palmerston North, refused to recuse himself from presiding over a NeuronZ intellectual property lawsuit where he was a close friend with one of the litigants, NeuronZ investor Jenny Gibbs.  Justice Williams barred media from the proceedings and subsequently ruled in favour of his friend.  A search of the Companies Office register showed two thirds of the shareholding at the time was held by a company set up by the University of Auckland on behalf of some prominent New Zealanders investors.
 
In the Fardell lawsuit a two week trial fixture set for June 2007 had to be abandoned due to the delay resulting from Justice Williams attempts to continue presiding over the case.  The plaintiffs are still hopeful that the trial can be heard this year.    Anthony Lusk QC is representing the insurance company on behalf of the deceased defendant.

QUEEN'S COUNSEL TRAINING: ONE LAWYER'S JOURNEY

Date published: 14 March 2007
     "Getting to the top takes time, skill and endurance along with guidance and mentoring from respected, experienced, successful   practitioners together with ongoing training and education.  To assist in the professional development of junior and intermediate litigators this conference has been specifically designed with this objective."    So began the Lexis Nexis training seminar for aspiring lawyers as Grant Illingworth QC launched into his presentation on "The fundamentals of the law of evidence" in April 2006 at the Langham Hotel in Auckland.  Doubtless, with this lead in, the 55 year-old Mr. Illingworth felt he had finally arrived.
 
Paradoxically, this introduction offered little on Illingworth's actual climb up the professional ladder.  Anecdotally, basically languid and reactionary when it came to his lawyerly duties, he was not the traditional Queen's Counsel archetype.  But what he lacked in legal skills and preparation, he made up for in the social circles that ruled the judicial appointment roost; a glad-handing politician's style with a mild, concerned demeanor toward the people he spoke with in the trade.  
 
The designation "Queen' s Counsel" (QC) represents an exclusive club in the legal professional, with less than 75, overwhelmingly male, practicing QC's in all of New Zealand (many other QC's are currently judges).  The reference itself harks to the current monarch of England, is bestowed by each Commonwealth nation and is ostensibly awarded to distinguish outstanding achievement among lawyers.  The first Queen's Counsel was Sir Francis Bacon, who was appointed in England in 1597.  While the Queen's Counsel title carries with it an unassailable quality in New Zealand jurisprudence (this reporter could find no record of a Queen's Counsel in New Zealand ever being struck off the roles) its origins were somewhat more inauspicious.  Sir Francis Bacon subsequently fell from grace having confessed to 23 charges of accepting bribes in the Court of Chancery. This resulted in his being sentenced by the House of Lords to imprisonment in the Tower of London.

 In the ongoing move to create a national identity apart from the U.K., the current Labour government has moved to abolish the designation (along with knighthoods as well).  Consequently, this would make QC's a dying breed in New Zealand.  Many in the legal profession welcome the change.  Other than creating license for those given the title to charge a higher fee, it was always slightly dubious as a strictly meritorious honour given the overwhelming political influences involved.  This is unfortunate for the many QC's who have truly stood out in their profession as the political graft has diluted the intellectual and skill quotient in the club.  Still, it was always a sought after and widely respected title. 
 
For Mr. Illingworth QC, he is simply glad to be in the club.  It appears a relative few lawyers who have seen the man in action would attribute his title to merit.  The lawyers this reporter has spoken to are reticent to say anything detrimental about the man personally - most commonly referring to him as a hospitable fellow - but none went so far as to praise his legal abilities.  A cursory look at the man's recent record on major cases seems to justify this lack of praise: 
           2004 - Illingworth represents Dick Hubbard in his defamation suit against the NBR in what was a hatchet job that saw a reporter sneaking into Hubbard's church and printing aspersions regarding how he and his wife worshipped, as well as leveling attacks on how farcical Mr. Hubbard's business success claims were.  Illingworth claims he won this case for Hubbard but the reality is that the case was essentially settled (after the NBR agreed to make a charitable contribution).  It must be stressed that he did not lose.
           2004 - Illingworth defends Israeli spies caught using fraudulent N Z passports to cloak their true nationality in their espionage activities (and put the focus of their espionage activities unduly on NZ).  The spies are found guilty, but under pressure from the Israeli government, the spies are released three months into their jail sentence and deported.  Illingworth filed an appeal on behalf of the spies conviction but said this appeal would not attempt to reverse the $100,000 fine the spies had paid by order of the Court to the Cerebral Palsy foundation, Illingworth saying this now was a "gift" by the two convicted spies.  Their appeal was subsequently withdrawn by Illingworth.
           2005 - Illingworth advises Vince Siemer to plead guilty to a contempt action initiated by Michael Stiassny.  Says a pleading of guilty will reduce a potential jail sentence of two years down to six months, with only three months of that sentence likely to be served.  The next question by Siemer exposes the fact that Illingworth hadn't read the file, with Illingworth saying "There is a lot more of the file I need to read".  Siemer, with no legal training, goes on to represent himself at the Court of Appeal.
           2006 - Illingworth breaches legal privilege by mailing unsolicited client email communications to the Court of Appeal and to opposing counsel in CA 55/06 in response to a witness summons being issued on him by the Court of Appeal.  Illingworth then sends a letter to the president of the Court of Appeal, William Young P, pleading ignorance and confusion and asking to be let off the hook.  Illingworth retrieves the privileged emails from opposing counsel and Court three days later; Justice Young says he did not read them so no damage had apparently been done.  The Auckland District Law Society is called upon to investigate.
 
Poor legal preparation, breach of fundamental principles and negligent advice aside, Illingworth does possess a remarkable survivor's instinct that has proven invaluable in the parochial circles of the New Zealand courts.  It is difficult to conceive, for example, that he would so blatantly violate the fundamental precept of client privilege unless he was convinced the Court would look the other way.  His communications with William Young P not only had the Court looking the other way on his breach of legal privilege but resulted in the Court withdrawing the witness summons for Illingworth to appear.  The effect was that Illingworth was not compelled to give evidence regarding comments he made that Auckland High Court Judge Judy Potter regularly breaches her oath of office.  He knew too well the Court would be relieved if he was not forced to give this evidence.  In the same fashion he has held up providing responses to the Auckland District Law Society investigation (is he able to work the corridors of power there?), a new professional standards director having recently been appointed at the ADLS.  Mr. Illingworth does indeed get around.  When Auckland University law school instructor Scott Optican was provided evidence of Illingworth's breach of legal privilege and providing a materially false affidavit to the Court of Appeal for his comments, he refused to look at it, saying that Grant Illingworth was well known at the Law School.
 
Mr. Illingworth is going to need these friends as the ADLS complaint against him heats up.  Watch this space for developments. ##

PARLIAMENT COMMITTEE FINDS AUCKLAND CITY MISLED CITIZENS ON EFFORTS TO OVERCHARGE $324 MILLION FOR WATER

22 September 2007
A Parliamentary Select Committee yesterday issued a report extremely critical of Auckland City Council's plan to run up profits of $324 million on supply of drinking water in order to fund other city services.  The Committee condemned the practise and strongly advised the Council to reconsider its demand that Metrowater Limited (the Council controlled utility) increase user charges to provide 'charitable contributions' averaging $32 million per year over the next ten years. 

The report noted the Office of the Auditor General and City's response that they both relied on 'legal advice' in adhering to the 'letter of the law' so as to ostensibly comply with clause 3.2.2 of Metrowater's constitution forbidding such profit demands from the City on this essential commodity.  While not directly attacking the legal opinions the committee concluded it was 'unwise for a public body to stretch the charitable payments provisions so far, and this undermined the public's trust in this local authority'.

Petition 2005/106 was lodged with Parliament by 40 petitioners, and was pushed by the Water Pressure Group, a public watchdog organisation.   Ms. Penny Bright, media spokesperson for the group, said this report would expose Mayor Dick Hubbard's (photo above) re-election campaign slogan of 'The People's Mayor' as a cynical affront to the average ratepayer whom he has gouged with inflated water charges in order that tens of millions can be spent annually on corporate consultants. #

Local News: 26/7/06
Auckland judge prevents the Auckland Coroner from releasing his findings into Robert Fardell QC's suicide.

        The public were again denied the right to know the full circumstances surrounding prominent barrister Robert Fardell QC's fatal fall from the 12 metre high Takapuna Head cliffs on 11 December 2005 when an Auckland judge ruled the Auckland Coroner was prevented from releasing his findings until judicial review proceedings are conducted.
        This action follows months of cover-up, where the last person to see the defendant alive (lawyer Christopher Morris) refused to grant the police an interview and the family hired prominent barrister Harry Waalkens QC to cover up the suicide and ensure the public inquest was conducted in secret (28/2/06).
         Years of cronyism have created a siege mentality that pervades the Auckland judiciary. Concerns are rampant as to what secrets Fardell may have wanted to get off his chest before he fell to his death and what damage this may cause to the vested interests within the provincial and secretive court.
         Several lawyers contacted expressed grave concern that there was no oversight or accountability of judges and this was yet another example where the Court put the protection of one of their own before the public good and interest. One called it "ugly" and another said that it demonstrates that the Court operates first and foremost to protect its favoured members.

Archive 22-6-06
Secret inquest into death of Robert Fardell exposed

I n a dramatic turnaround to initial reports, the Auckland Coroner, Murray Jamieson, today was forced to concede Robert Fardell QC did not drown on 11 Dec. 2005 while swimming but instead suffered massive injuries from a fall before drowning. This ruling came almost 4 months after an attempt by the Coroner's office to conduct the initial public inquest (held on 28 February 2006) in secret, in contravention of the Coroner's Act 1988 that required public notification. Despite the body being found on rocks at the base of Takapuna Head cliffs on Auckland's North Shore, and no suspicions of homicide, the Coroner did not suggest death was a suicide. Prior to this ruling, Fardell family lawyer Harry Waalken QC had attempted unsuccessfully to suppress all the inquest evidence, arguing further that the death could be accidental and that the Coroner had no standing to suggest to the contrary. This position ignored Mr. Fardell having had to breach a fence to reach the cliff edge. Fardell was 52 years old when he died.

NATIONAL COURT NEWS : dateline 25 October 2006

       Michael Stiassny is seeking the shelter of the New Zealand Courts yet again for his role in what is being recognized as the largest tax scam in New Zealand history, the $1.7 Billion CWF forestry tax dodge.
        The Inland Revenue Department shut the tax dodge down after nearly four years of operation and ordered the parties to pay back the taxes, as well as millions of dollars in penalties. The tax dodge vehicle, CWF Holdings Ltd, was then cast off into liquidation by the perpetrators. The appoint- ment of the liquidators by Stiassny and others was subsequently challenged in the High Court at Auckland by Trinity Foundation Limited, a charitable foundation administered by the Anglican Church that was used by Auckland Solicitors Bradbury & Muir as the cover for the tax avoidance scheme. Trinity claims not to have been paid in excess of $12 million owed it by CanWest, the local division of the Canadian Media conglomerate. Stiassny and Grant Graham are alleged to have breached their duties to the company and engaged in a breach of trust by acting minimally in a de facto fiduciary arrangement with CanWest.
           In an appeal brought by Trinity, and heard by the Court of Appeal on 18 September 2006, Trinity counsel Bruce Stewart QC sought the right to pursue Stiassny individually for his key role in the failed tax scam, noting that the current liquidators are unlikely to do so as they are beholden to Stiassny and certain others involved. As of this printing, no ruling has yet come down from the Court of Appeal. The IRD has not legally prosecuted those involved in the scheme. Anonymity was granted as part of a settlement reached.
         Two of the three judges considering the Trinity appeal, namely Court of Appeal President William Young and Justice Terence Arnold, are at the same time considering an appeal on the papers for a stay of a High Court costs ruling that Stiassny secured against Auckland businessman Vince Siemer for an alleged violation of a High Court injunction, an injunction that Stiassny has claimed prevents Mr. Siemer from revealing information regarding other dubious accounting schemes that Mr. Stiassny has been involved in. In order to obtain the injunction, Mr. Stiassny submitted an affidavit to the Auckland High Court on 8 April 2005 wherein he swore that none of the allegations Mr. Siemer had made about him on the www. stiassny.org website were true. Stiassny then filed a $1.25 million defamation suit against Mr. Siemer on 12 April 2005, as he was required to do in exchange for obtaining the ex- parte injunction against Siemer, but he has repeatedly failed to advance his case against Mr. Siemer since obtaining the injunction. On 6 October 2006, Stiassny failed to comply with a court imposed deadline that he provide discovery in that case.
            These matters are part of a firestorm of controversy currently surrounding Mr. Stiassny. Last week, Stiassny refused to allow media cameras into the Vector Limited AGM held in Auckland. The very next day Stiassny was the catalyst for a raucous revolt that disrupted the Auckland Energy Consumers Trust AGM and required the unsuccessful intervention of security personnel. Those who did not realise Stiassny was in the room had their attention directed to the man wearing the dark business suit and the 'Dumb-and-Dumber' haircut sitting to one side of the room. Stiassny was then whisked from the building by Vector staffers.
         The AECT was the 100% owner of Vector Limited until Chairman Stiassny led a 24.9% sell-off in the form of a public share offering on the NZX exchange in August 2005. The need to pay down Vector's ballooning $3.15 Billion debt ? in part a result of its contentious acquisition of NGC the year before ? was cited at the time as a primary reason why the public equity float was necessary. Yet only 2% of the debt was ultimately paid down after the successful 25% share float.
           Mr. Stiassny has been publicly claiming he grew Vector from a $1 Billion company to a $5 Billion company in 3 years. At the Auckland Consumers Trust AGM much of the controversy was directed at Vector's claim that assets had appreciated 17.9% in the last fiscal year and that nearly $1.7 billion (or 30%) of Vector's current valuation was in the form of "goodwill". As a comparison, Vector's valuation of its goodwill is now roughly equivalent to the goodwill of the Coca-Cola Companies at US$1.2 Billion.

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MANY LEGAL ISSUES LOOM IN DISTRICT LAW SOCIETIES' FINAL DAYS

Dateline: 1 June 2007 
When the 14 District Law Societies in New Zealand become absorbed into the New Zealand Law Society in 2008, it will close the book on these legal fiefdoms that often conflicted in their approaches, exploited regional differences and largely failed in their mandates to the public to enforce a consistent code of conduct among lawyers due to the incestuous professional relationships that plagued these local chapters.  Such a haphazard and unreliable framework had been long-recognized by the Government to be the bane of a respectable and efficient Bar. 
 
By passing the Lawyers and Conveyancers Act 2006 the New Zealand Government has taken an important step in establishing a central authority removed from the influence of individual lawyers who often used the district societies to reward friends and, conversely, settle scores.  As one example of this, the Auckland District Law Society aggressively protected Society-prominent Auckland lawyers such as the deceased Robert Fardell QC and Grant Illingworth QC against extremely serious breaches of the law and legal ethics, while at the same time spending many hundreds of thousands of dollars to chase the colourful and hard-living erstwhile barrister Christopher Harder over many years because, in part, his unpolished approach offended the sensitivities of those in charge. A national body is regarded by the government as providing some protection against misuse of powers and assets on local levels.  While district law societies are allowed to continue as incorporated entities under the Act the lack of mandatory membership provides a strong financial catalyst for districts to amalgamate into and operate within the 'One Society Plan' which is being circulated. 
 
A discussion paper on the subject put out by the Auckland District Law Society lucidly identifies the problems that were inherent in the old structure.  It states,  "The current law society structure is cumbersome and unwieldy. Each district law society operates independently and there is minimal communication between NZLS and district law societies and even less between districts themselves. There is no facility or organised management structure to promote communication, sharing of ideas and issues or to create efficiencies in compliance costs or administration. The structure is not conducive to creating a climate of mutual trust and community of spirit. Nor does it take advantage of any efficiencies or cost savings that might be achieved by streamlining functions on a national basis."
 
The ADLS is the largest district society by far with a staff of 53 and membership roster of some 4,000 lawyers.  It also has substantial assets, including a building valued at $10 million in the Chancery section of downtown Auckland.  According to the Act, these assets automatically become the assets of the NZLS at the time the district societies are dissolved.  This has resulted in a petition being filed this week by Whangaparaoa solicitor Dennis Gates asking that the building be sold and the proceeds distributed among the members prior to dissolution of the ADLS.  This would result in each lawyer receiving approximately $2,500 if Gate's petition is put to a vote and acted on. 
 
The other significant asset is the law library, of which each district was required to provide.  There appears a general consensus the law libraries should be retained at the local levels after the districts are folded into the NZLS, with three main libraries operated in Auckland, Wellington and Christchurch.
 
The Act removes statutory responsibility for regulatory functions from district law societies and places all responsibility with the NZLS. Under the current plan, district law societies would continue to perform the regulatory functions on contract to the NZLS. How those contractual arrangements would work in practice has yet to be defined. It is expected that the NZLS would need to introduce a national standard for the performance of all regulatory functions in short order and district law societies would be required to adhere to those standards. In addition, the Act requires a strict separation between the funding of regulatory and representative functions and introduces new regulatory requirements, particularly around the handling of complaints, the extension of Standards Committee powers and responsibilities, and the requirement to deal with complaints about client care issues.

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AUCKLAND CITY CEO RANKIN REFUSES OIA REQUEST ON $91 MILLION SPENT FOR CONSULTANTS AHEAD OF ELECTION

17 October 2007, Auckland 
The disclosure in August that Auckland City spent $91 Million on 'consultants' over the last three years has taken a nasty twist with the revelation that Auckland City CEO David Rankin has failed over six weeks to respond to an Official Information Act Request by erstwhile Auckland Mayoral Candidate Lisa Prager.  

Ms. Prager wants to know specifically the amounts attributed to the 'contracting out' of the 64 services provided by Auckland City Council.  The consultancy fees amount to $200 for every man, woman and child living in the city.  

The public revelation of this staggering expenditure in August caused considerable angst among many councillors, coming as it did ahead of the local body elections that close this weekend.  CEO Rankin's employment contract is now being reviewed by the City as a result of what many councillors claim was knowledge they had not been privy to.  Mr. Rankin's actions in failing to respond to Ms. Prager's request is viewed as a transparent attempt to deny the voting public this useful information ahead of voting.  This week Ms. Prager was assisted by the Water Pressure Group, a private watchdog group, filing a formal complaint with the Office of the Auditor General over the alleged obstruction of public financial information by Mr. Rankin. 

Even without this information, the disclosure has dealt a significant blow to Mayor Dick Hubbard's re-election campaign.

This drama follows a raucous Auckland City Council meeting held Thursday night, 23 August 2007, at Town Hall that had Mayor Hubbard slapping the air with his hand in a persistent attempt to maintain order, City Councilors sparred angrily over whether the Business and Corporate Finance Committee chaired by Cr. Vern Walsh was sandbagging the extent of the City's exposure on leaky building damage claims ahead of local elections in October.  Public sentiment was strong that elected officials were not providing adequate disclosure of the known financial risk.  Possibly as a result of this sentiment, Crs. Armstrong and Scott Milne sought a ruling to advance the issue as an extraordinary matter of business, thereby putting immediate pressure on the F&CBC chair to provide full financial disclosure to the full council.  Mayor Hubbard and former deputy mayor Bruce Hucker joined Cr. Walsh in a futile effort to defer the issue, saying the normal course already set would provide complete results within three weeks.  Tensions reached a peak when Cr. Walsh responded that Cr. Armstrong's allegations were 'bordering on lies', a statement he was forced to retract after Cr. Armstrong took exception to the remark and Walsh sought but failed to get support from other councilors.  As to Milne, Walsh accused the councilor of cheap electioneering in the lead up to the election. 
 
The leaky building issue has been a known source of significant financial exposure to councils that provided codes of compliance on buildings constructed with untreated wood for many years, but has become more pressing because the 10 year statute of limitation - and hence the greatest number of damage cases - is quickly approaching.  Major building code changes some eight years ago prohibited the use of untreated wood when widespread rot began to surface in new construction.
 
The Council adjourned deeply divided, with the Mayor urging patience and trust in the F&CBC providing the actuarial figures as quickly as they become available.
 
Until this heated debate, it appeared the major drama would be over the Mayor's refusal to allow speaking rights to Ms. Penny Bright of the Water Pressure Group.  In a move that minimally ranked as nonsensical, the Mayor refused to allow Ms. Bright the customary 5 minutes, choosing instead to cause a major spectacle and delay of 35 minutes to the meeting by calling a temporary adjournment when Ms. Bright forcibly took the visitor's podium to address the City's ongoing policy of assessing 'charitable contributions' to water-users bills in order to fund other city services and tacking on surcharges for storm water based upon water usage.  Mayor Hubbard asked the police to arrest Ms. Bright for trespassing, but responding officers refused to do so. Instead, two police constables sat behind Ms. Bright the rest of the meeting.  It was little wonder then that the full council was a little irritable after the long and unnecessary delay.  #  BACK TO FRONT PAGE 

A JUDGE'S WRATH

27 April 2009
Judge Michael Lance QC (left) is under criminal investigation for allegedly vandalising the car of Auckland businessman Richard Cummins.  The incident happened on 23 March 2009 in front of the Judge's apartment block in Browns Bay, Auckland.  The crime was witnessed by two patrons at a nearby café and resulted in $4,000 damage to the vehicle.  A total of 21 deep scratches were "keyed" into various panels of the car while Mr Cummins was in a business appointment nearby.  Story continues

WHISTLE-BLOWING GREATER CRIME THAN NEGLIGENT HOMICIDE ACCORDING TO NZ JUDGES

21 March 2009 
How out of touch are New Zealand Judges?  Consider the contrasting cases of the Sir Edmund Hillary Outdoor Pursuits Centre tragedy resulting in the deaths of 7 people against three recent cases of whistle-blowing by conscientious New Zealand citizens. FULL STORY

WHAT'S WORSE THAN BEATING A DEAD HORSE?

5 March 2009
Three  years  ago  former police prosecutor and current private investigator Grace Haden, operating on a tip, questioned the subsistence of the Animal  Welfare  Institute  of  New  Zealand  (AWINZ ).  It was disclosed to Ms Haden that AWINZ was paid handsomely to lend its name to the movie credits of Lord of the Rings, attesting that no animals were harmed in the making of the movie.  Beyond the mystery of what AWINZ actually was, the reality was that AWINZ 'officers' were on set less than 25% of the animal action time.  Haden's source informed her that a horse named Moon was sent to slaughter after non-specified problems with its front legs.  Three other horses reportedly died during shooting. 
Story Continues 

TRANSPARENCY INTERNATIONAL INVISIBLE IN NEW ZEALAND

12 February 2009
Located in a obscure closet office on the fourth floor of an old department store in Wellington is an 'independent' New Zealand lobbying and fundraising arm of the 15 year old private not-for-profit Transparency International, based in Berlin .  But if you try to find out anything about them, you better be a good investigator.  We tried our best and came up with some interesting background and contradictions.   READ FULL STORY

JUDGE COOPER'S RACIST INVECTIVE TAINTS HIGH COURT RULING

1 January 2009
Under cover of the Christmas Holiday, Auckland High Court Judge Mark Cooper (right) ruled that kiwisfirst editor Vince Siemer had defamed Auckland insolvency accountant Michael Stiassny with publications on this site and ( website name blocked by order of the Court).  Siemer was ordered to pay $920,000 damages to Stiassny, plus unspecified Court costs.

Cooper's 23 December 2008 judgment finding Mr Siemer guilty of defamation followed a 'formal proof' trial conducted sometime in October.  Mr Siemer was debarred from defending himself at that trial because he refused to pay application costs totaling more than $200,000 which Justice Judith Potter had awarded Stiassny ahead of trial.  A Jury trial was earlier denied by order of Justice Rodney Hansen at the request of Stiassny's lawyers on the basis New Zealand citizens were incapable of understanding the complex nature of the defamation alleged against Mr Siemer by Mr Stiassny.

It is understood that Stiassny and an employee of Korda Mentha (formerly Ferrier Hodgson) Alan Garrett, walked into an Auckland Courtroom in October and told Judge Cooper the sad story of Stiassny having to tell his children that he did not do any of the things which had been evidentially detailed on ( website name blocked by order of the Court) in April 2005. Testifying his side of this bizarre 3 1/2 year-long legal escapade, Mr Stiassny told the Judge he had spent over a million dollars in legal costs pursuing Mr Siemer and that everything Mr Siemer published about him were lies which had been previously investigated by the Serious Fraud Office and Institute of Chartered Accountants and found to be baseless.  No reporters or public were present at this cosy meeting.  No record was apparently taken. 

The undefended trial was the first time in the long court battle that Michael Stiassny had appeared in Court.  His appearance came after the Judge provided assurances that Mr Stiassny would not be cross-examined on his testimony.  Judge Cooper thought it best that Stiassny not be further traumatized by suffering the indecency of having his answers challenged in respect of the professional transgressions alleged by Mr Siemer.  These allegations were that Michael Stiassny wrongly attempted to label Paragon Oil Systems Ltd insolvent in 2001 - at a time when the company was flush with cash and had no fixed debt - and had attempted to overcharge Paragon some $10,000 in fees, an overcharge which was thwarted when Managing Director Vince Siemer refused to sign off on payment. 

Perhaps the strangest aspect of the case is that both allegations were earlier proven to be correct in Court - using Stiassny's own documents - yet Judge Cooper failed to address any of this evidence in his lengthy 25 page judgment. 

The "official" summary of the events and trial lies in the often acerbic words of Justice Cooper's judgment, demonstrating how serious the Judge considered the defamation to be.  In paragraph [49] of that judgment Cooper quoted what he later referred to as "clear instances of vile racist abuse [by Mr Siemer]".  In an apparent quote of Mr Siemer, Cooper J stated -
     "Mr Siemer had referred to Mr Stiassny as a man with "exceptional sway within the small Jewish community" and had commented that "when the judiciary determines that a ruthless and powerful man's reputation is so priceless...the Gestapo cannot be far behind...people like Adolph [sic] Hitler....".

The big problem is that Mr Siemer made no such racist remarks.  Justice Cooper simply took words from unrelated articles, juxtaposed them, then attributed the resultant fictitious quote to Mr Siemer.

Because it breaches a Judge's order to refer readers to the actual website which contains the articles which Justice Cooper selectively pulled words from, the relevant sections are printed below.

In one article which tracks Michael Stiassny's questionable relationship with Robert Fardell QC prior to Mr Fardell's suicide in December 2005, Mr Siemer actual wrote - "Stiassny, the man (Fardell) had inextricably linked himself with, a man with exceptional sway within the small Jewish community and certain sectors of the business community, had spurned his pleas for help."

An unrelated interview posted on the site had Mr Siemer answering the question " Can you really argue with Judge (France's) decision that one cannot put a price on Stiassny's reputation whereas the only thing you have lost is your expenditures on the billboard and website?"   
To which Mr Siemer answered:
"Are you kidding?!  The hearing was the same week as Anzac Day.  Those gallant men and women who paid the ultimate price for freedom would roll over in their graves to learn that a High Court Judge played truth police while quashing freedom of expression.  When the Judiciary determines that a ruthless and powerful man's reputation is so priceless that any evidence and experiences that he claims undermines it must be purged and banned, the Gestapo cannot be far behind.  I am not being over-dramatic.  Erosion of civil liberties is notoriously unremarkable as it is occurring.  If history has taught us anything it is that people like Adolph Hitler, Idi Amin, Saddam Hussein and Pol Pot succeeded in committing horrendous crimes only through purges of public opinion that conflicted with the reputation they sought to promote."

Judge Cooper's "quote", which he attributes to Mr Siemer, is compiled from the words highlighted in the actual publications (above).  This example gives a small glimpse into how justice is regularly arrived at in the parochial New Zealand Courts.  New Zealand Judges know that because of the small subscriber base in New Zealand for the legal reporting clearinghouse Lexis Nexis, Lexis Nexis relies solely on judicial summaries when reporting court decisions. 

NATS SET TO REPLACE DENTAL NURSE AND HISTORY TEACHER AS MINSTER OF JUSTICE AND ATTORNEY GENERAL

9 November 2008
The National Party trounced the Labour Party government in elections yesterday with 46% of the vote to Labour's 33%. National Party Leader John Key moved quickly to secure the support of the Act Party and United Future before giving his acceptance speech last night.  Mr Key will now be the new Prime Minister. 

Top on the list on National's many priorities is the replacement of Justice Minister Annette King and Attorney General Michael Cullen.  Neither incumbent head has a law degree.  National is expected to replace King with Rangitikei Solicitor Simon Power and Cullen with Wellington barrister and former Bell Gully partner Chris Finlayson.

POLICE ON VERGE OF SECOND ENQUIRY INTO DAVID COLLINS

20 October 2008 
A new Police complaint against embattled New Zealand Solicitor General David Collins (left) is being explored in relation to Mr Collins' recent attempts to prevent evidence of Judicial conflict of interest by current New Zealand Supreme Court Justice Bill Wilson from being brought before the Court. 

Prime Minister Helen Clark and Deputy Prime Minister Michael Cullen have been briefed in relation to the multiple criminal investigations against Mr Collins but have chosen to bury the mounting scandal within their administration in the lead up to the election.  The Labour government's re-election platform is that this election is about "trust".

The Dominion Post was to run an article but the editors killed the article in the wake of the Solicitor General's unsuccessful prosecution of the newspaper for contempt last month.  That prosecution was over the DomPost's publishing Police evidence in the ill-advised Crown prosecutions under the 'Terrorist Suppression Act' last year.  DomPost Editor Tim Pankhurst has spoken candidly about the grueling 6 hours of cross-examination he was subjected to by Mr Collins in that action.

Last year, Judge Wilson failed to recuse himself in an appeal he presided over where the lawyer acting for the appellant, Alan Galbraith QC, is his 50% partner in a $10 Million stud farm.  Wilson J remained on the panel which overturned the High Court decision and ruled in favour of his business partner's client in Saxmere v the Wool Board.
 
Detective Inspector Rod Drew, who is currently conducting a criminal investigation of Mr Collins under section 111 of the Crimes Act in another matter, refused to take the new complaint on board, citing his "very specific terms of reference" in the earlier investigation as a constraint.  He referred the new complaint to another senior Police official.
 
Along with the Judicial Conduct Commissioner Ian Haynes, Collins repeatedly tried to quash any vetting of the complaint against Justice Wilson, even after Legal Ethics Professor Duncan Webb of Canterbury University countered their legal excuses as to why the complaint could not proceed.  After a Special Leave application was filed in the Supreme Court last month, Mr Collins phoned Al Morrison, the boss of the Applicant's solicitor Sue Grey and had her fired after she refused to remove herself as lawyer for the client she had acted for over 5 years.  Collins claimed that because Ms Grey worked for the Department of Conservation, her action against a Crown Judicial officer violated her duty to the Crown, putting the lawyer in a conflict of interest. 
 
In the meantime, David Collins remains Solicitor General, even though he is under criminal investigation.  Mr Collins sees no conflict of interest in the result that, if the Police conclude Collins should be criminally prosecuted in the first complaint, Mr Collins, acting for the Crown, would be called upon to make the determination as to whether or not to prosecute himself. #

PM TOLD OF CRIMINAL PROBE OF DAVID COLLINS

8 September 2008
Prime Minister Helen Clark was privately informed of the Police criminal investigation into Solicitor General David Collins last Thursday.  How is she handling the investigation and the potential three year prison sentence the alleged offence carries against her highest legal appointee?  ( read story)

ROYAL COMMISSION OF PAIN

23 June 2008
This year is proving to be an inauspicious one for the Auckland City Council and its well-paid allies (read 'contractors').  The Royal Commission of Inquiry looking into governance practices by local Councils was, only a year ago, expected to be a mere formality designed to show the public that politicians and bureaucrats were not asleep at the switch when it came to the efficient spending of the public's hard-earned local rates.  What a difference a year makes.  READ STORY

SOLICITOR GENERAL TESTIFIES NO UNLAWFUL ORDERS OCCUR IN NEW ZEALAND

18 June 2008
Testifying before a two judge panel in the Auckland High Court contempt trial of Vince Siemer on Monday, Solicitor General David Collins was not pleased.  His terse answers revealed much about the man, as well as his motivation in bringing the contempt action against Mr Siemer for operating this website.  Mr Collins has alleged that comments relating to Mr Stiassny on this site violate a temporary gag order by the Court issued back in May 2005.  Mr Collins admitted his action is highly unusual but insisted it was necessary in this case to protect the rule of law in New Zealand.
 
The diminutive Mr Collins elevated himself in his chair in order to rest his elbows on the witness box and, in a measured and sure tone, claimed his application was a last resort, and well worth the $250,000 in taxpayer funds it is expected to cost.  Judges Gendall and Chisholm refused to allow Mr Collins to be classified as a hostile witness because he had not filed an affidavit in support of his own application.  Their Honours imposed strict limitations on the scope of questioning.  Nonetheless, the witness testified to have never witnessed an unlawful order by a New Zealand judge in his long and broadly experienced career. 

At one point Mr Collins responded to a hypothetical question put to him of whether a judicial order which compelled a party to medical testing or barred certain races of people from associating would constitute an unlawful order of the judge.  He answered 'No', -even repeating his answer when the bewilderment in the Courtroom became palpable.  Justice Chisolm and Gendall quickly intervened to save the Solicitor General from himself and let it be known that the questions and answers were not helpful in the determination the Court would ultimately make. 
 
As a 'defence' witness, the defense was prohibited from challenging any of Mr Collins' answers.  Mr Collins twice appealed to the judges to rule that he not be required to answer a question put to him.
 
The next witness, Ms Esther Watt of the Crown Law office, was not so fortunate.  Ms Watt had been employed less than six months in the Crown Law office when she was directed by Mr Collins to monitor the websites www.kiwisfirst.co.nz and www.stiassny.xxx for injunction-challenging content.  She submitted two affidavits wherein she asserted her exhibits (publications off the above websites) confirmed a breach of the 5 May 2005 injunction ruling of Ellen France J.  The problem was Ms Watt admitted under cross-examination that her only duty for the Crown in this case was to periodically print out the contents of the websites.  She claimed not to have been included in the discussions as to what was alleged to have breached the injunction and she further admitted she had only 'skimmed' Justice France's injunction order.
 
Ms Watt's early testimony that she had only a cursory involvement in the case elicited questions on how she could possibly have been promoted by the Crown as their star (and sole) material witness if this were the case.  Mr Siemer then quoted Ms. Watt's latest affidavit wherein she swore "Since the date of my first affidavit I have viewed the websites... from time to time, this process has confirmed that information which breaches the injunction of Ellen France of 5 May 2005 has continuously been published on those websites since 28 January 2008".  Ms Watt tried to restore some credibility after the revelation but the damage had already been done.  After being dismissed, Mr Collins comforted Ms Watt outside the Court.
 
The second day of the two-day hearing saw only oral submissions from both parties.  Madeliene Laracy, counsel for the Solicitor General, tried to recover from Ms Watt's poor performance on cross-examination and meticulously laid out the publications which the S-G alleged breached the 3 year old gag order.  She relied on contempt cases as far away as Ireland and South Africa.
 
After Ms Laracy laid out the Sol. General's case, Mr Siemer responded by pointing out what he said was Ms Laracy's 'utter failure' to relate one publication to any passage within the injunction she purported to solely rely upon. 
 
It was only then that the Court allowed Mr Siemer to argue his application to dismiss the proceeding as 'double jeopardy', as provided by section 26 of the New Zealand Bill of Rights Act 1990.  He then cited Potter J's earlier ruling of 13 July 2007 that purported to deal conclusively with the injunction; reading from Her Honour's ruling that the six week prison sentence at the time "reflects the past and continuing breaches of the injunction" by the respondent. 
 
As with Mr Siemer's application for a trial by jury under section 24 of the Bill of Rights Act, the Court refused to acknowledge its statutory obligations under section 26, instead relying on 'judicial discretion'.   At one point late in the two day hearing, heated debate erupted between Mr Siemer and the bench when the judges claimed they did not have to give their reasons for not acknowledging the Bill of Rights guarantees.  Mr Siemer accused Gendall and Chisholm JJ of attempting to 'legislate from the bench' after they accused him of breaking the 'law' but then refusing to tell him what that law might be.   When Chisholm J insisted it was up to the Court to define the meanings of these straightforward laws, Mr Siemer read Article 67 of the North Korean Constitution that stated "The State shall guarantee... freedom of speech, of the press, of assembly, demonstration and association".  He implored the judges not to treat New Zealand law as the North Korean Courts treat their Constitution.
 
The hearing adjourned at 4:30 pm.  The judges have reserved their decision..

JUDICIAL CONDUCT COMMISSIONER IAN HAYNES IS 0 for 250

Justice Minister Wages War on Estate Agents to Divert Attention Away From Situation

19 November 2007
Kiwisfirst has uncovered serious deceit and conflict of interest charges against Ian Haynes.  Haynes, who has been the Judicial Conduct Commissioner since the inception of the position by Parliament in 2004 to combat judicial misconduct in New Zealand, has handled some 250 separate misconduct complaints against judges without a single one deemed worthy of even a formal investigation (which was the entire purpose of Parliament establishing his office). 

It was first revealed six months ago by kiwisfirst that Mr Haynes is a current partner of lawfirm Kensington Swan.  As such his personal income is directly tied to keeping all judges, corrupt or honest, fat and happy.  Last year, Mr Haynes' firm was given $2.26 Million dollars in legal aid by the government - more than 10% of the entire nationwide budget.  Mr. Haynes' take from this alone would have been over $100,000.  Legal Aid is significantly influenced by the judiciary.  Mr Haynes would say his position as JCC and his firm receiving almost two and a half times more money than the next highest lawfirm allocation of legal aid largesse is purely coincidence.  Perhaps, but then I also heard pigs can fly (the latter claim not from Haynes).  What this information does do is add new meaning to Mr Haynes claim to kiwisfirst editor in May 2007 that he is not the Judicial Conduct Commissioner for the $90,000 annual salary the position allows. 

The greatest problem and threat to the public - given the small, cloistered and closed knit commaderie of NZ judges - is that Mr Haynes has a distinct conflict of interest between his oath to protect the people of New Zealand against errant judges and his professional and financial livelihood.  Gambling, debt and drug problems of many judges are adding undue pressures on Mr Haynes to 'tow the company line' to protect his legal colleagues.    In legal communities around the world, this type of conflict of interest would get a lawyer disbarred.  Not in New Zealand.  Like the Police, there is a general culture within the NZ Courts that it is better to maintain the appearance of honour and integrity of judges even if this means hiding some egregious misconduct by a few.  As an 'old-boy's' old-boy, Haynes subscribes to this misguided principle.  He protects the judges.  Judges then protect him and help make him a wealthy man in the typical quid pro quo. 

It gets worse.   Haynes has repeatedly claimed he is not able to access court audio-transcripts and computer records to investigate judicial misconduct charges - only 'written documents'.  This claim is despite all Court rules' definitions of 'documents' including these forms.  More unsettling than this, Haynes would know that New Zealand Courts are notorious for inaccurately transcribing audio-transcripts and altering written documents, particularly when judges conduct is challenged.  Every lawyer who appears in court regularly knows this but all are prohibited from saying anything by a strict Law Society code that will revoke a lawyers license for 'bringing the Court into disrepute'.  Several years ago the High Court and Court of Appeal specifically prohibited accurate recording unless the judge gives permission - this because too many judges were being caught out fabricating records. 

When the heat of a valid judicial conduct complaint gets too much, Haynes is also prone to claim his ruling is based on anonymous outside legal advice.  This way he cannot be held directly and personally accountable for protecting a corrupt judge against the weight of the evidence.  He simply claims he acted on professional advice at the time.  The giver of the advice, in turn, cannot be held accountable because his/her only obligation is to the person soliciting their advice and they had no control over how their advice was used by the party seeking and using it.  Consequently, one hand legally washes the other.  It is a common ploy used by lawyers in professional negligence cases.

Where are our Justice Ministers when this travesty is occuring?   Ironically, Associate Justice Minister Clayton Cosgrove (above) is on a mission to instill more oversight of the real estate industry.  He has been a virile critic that the 2 1/2% discipline rate by the Real Estate Institute of complaints against its members is obvious evidence the real estate industry is not doing an effective job of policing its own.  At the same time Mr Cosgrove's own Judicial Conduct Commissioner is sitting on a zero percent success rate in merely launching a formal investigation.  Not one!  The contrast could hardly be more stark.  How does Mr Cosgrove keep a straight face through the hypocrisy?  He refuses to comment.  It appears hypocrisy has no bounds when it comes to politics and corrupt lawyers.  Not surprisingly, Justice is Mr Cosgrove's trusted government responsibility, his baby, in his own backyard.   The joke is, once Mr Cosgrove brings Real Estate Agents under his protective wing, disciplinary actions against them will sink, like judicial discipline, to zero percent.

The Police, lawyers, accountants and engineers are but a few of the many other professions who regualate the conduct of their members in New Zealand.

This is an appropriate time to mention that the new Lawyers and Conveyancers Act 2006 now gives lawyers the right to sell real estate and broker loans.  No doubt we can take comfort in Mr Cosgrove holding lawyers accountable once they take over the job of the real estate agents he seeks to vilify and run out of town.  This is where we quote the Tui beer campaign: "Yeah, Right". 

Mr Cosgrove does not need real estate agents but he is clever enough to know politicians can never have too many lawyers-turned-judges in their corner.  For him there is no downside in protecting dishonest judges.  Perhaps with legislators like Mr Cosgrove protecting our interests, we should count our blessings.  He could have been put in charge of terrorism.#
To express any comments to the Hon. Clayton Cosgrove, email him at ccosgrove@ministers.govt.nz

5 December 2007
Despite an increase in the number of High Court judges being appointed, case backlogs have increased significantly in the Auckland High Court in the last two years.  Currently some cases set for trial are having to wait more than a year for a trial fixture from the Court Registrar. 
 
There are a number of apparent reasons for the chaos now plaguing the Court.  The high turnover of court staff is not an insignificant one.  But perhaps more problematic than this turnover is how court proceedings are set and actually conducted.  Professional courtesy by judges to fellow lawyers has become so seemingly paramount, and the fear by lawyers that a hearing adjourned due to insufficient time so commonplace, that both sides are increasingly demanding longer average fixture allotments from the Registrar.  This cannot help but place a burden on the court.  The Registrar does try to effectively deal with this imposing demand by overbooking fixtures, having the realistic expectation that a large number of cases will fall out due to settlement, a truncated trial or further adjournment applications.  Still, overbooking is conducted with an eye toward caution.  The consequence is that in any given week, many judges find themselves with a lighter than average schedule.  Paradoxically, the backlog of cases increases.
 
Another quite significant problem is the average court day.  It starts typically at 10:00 am and ends at 5:00 pm.  Officially included in this 7 hour period is a lunch of 75 minutes and two 15 minute tea breaks.  Many judges run a tight ship and pack a full day in the available 5 ¼ hours.  However, this is not the rule.  As only the judge determines the schedule, lunches frequently extend to 1 ½ hours and breaks to 25 minutes.  It is not uncommon for tea breaks to last for a half hour, as the parties waiting for the hearing to reconvene occupy themselves with small talk in the courtroom.  Consequently, a full day in court often amounts to barely 4 ½ hours.
 
The biggest losers in all this are the public.  Lawyers typically charge a daily rate for court appearances.  Quite often this includes up to 16 billable hours preparation for each day expected in court.  If the judge's conduct of the proceedings results in a three day trial instead of two, everyone carries the resultant burden.  Sure, the lawyer gets paid for waiting around, but few conscientious ones feel good about it.  The Registrar faces additional scheduling stress and the cost of justice increases unnecessarily for all.
 
Finally there is the tactic some lawyers employ to delay the proceedings.  As the ability to obtain an early trial fixture is inversely proportional to the number of days requested, a lawyer who does not want his case heard any time soon will merely say the matter requires a much longer trial fixture than he considers will likely be the case.  This is simply smart lawyering but it ultimately falls to the judges to either comply or prudently ascertain this to be a less than earnest demand on limited court resources.  Few judges are actually inclined to curtail the requests.
 
A great deal of new legislation has been enacted in the last couple years and a complete review of existing laws is underway by Sir Geoffrey Palmer.  The chaos in the Auckland Court comes at a crucial time in New Zealand's recent history which, together, threatens to create the ingredients of a perfect storm. #  BACK TO FRONT PAGE

VECTOR AGM A LESSON IN CORPORATE THUGGERY

20 October 2007
Amid hired security forces that rivaled that of a traveling head of state, Vector Chairman Michael Stiassny threatened looming electricity infrastructure cutbacks and looked to blame Vector's lackluster business performance and its huge and mounting debt on government regulators during the company's annual general meeting yesterday. 

About three hundred people attended the gathering held at Ellerslie Event Centre.  At least two shareholders were denied access by Russell McVeagh solicitor Michael Heron who said he had orders from the board of directors to instruct security staff to prohibit these shareholders from entering.
 
In a scene reminiscent of Jonestown (the former Jim Jones sect compound in Guyana infamous for murder and mass suicide) the Chairman commenced the meeting by pointing out all the exits before launching into claims that the company was under siege from the Commerce Commission.   Security guards stood ominously at the doors as he spoke.  Cameras were not allowed in.  He wasted no time telling shareholders that this regulatory environment singularly threatened their investments.  In a salvo fired at consumers he warned the company's future investment into electricity and gas supply infrastructure was also at risk.  Both Stiassny and Acting CEO Simon McKenzie stressed the uncertainty and unpredictability of the regulators as the true source of Vector's financial woes.
 
Vector's financial troubles are no small problem, not simply for the investors but also the regional consumers who have seen the company's debt skyrocket over the last few years to a current $3.127 billion - up $46 million from last year despite selling off nominal assets.  In order to maintain the dividend payment to shareholders this year, retained earnings went into negative territory.  The monopoly utility also has $1.6 billion in goodwill that it has been unable to significantly write down due to its perilous financial position.  This overall financial scenario is now being used to pressure the regulators into letting Vector charge power consumers more than the Commerce Commission has said they are entitled to do.  
 
The current situation is in stark contrast to two years ago when Stiassny was proudly telling public meetings that he was responsible for a half billion dollar unrealized capital gain on the acquisition of NGC by Vector.  If true, Vector could sure stand to capitalize on this gain now.  However, as with much that comes from Stiassny, this was part arrogant bluster and part accounting parlor tricks serving to pass as accepted fact.  Nevertheless, the real story is the substantial debt that the company took on board at the time of this purchase and which it now is struggling to discharge.  The company has recently looked hard at selling off assets to get its debt ratios down to reasonable levels and its precarious BBB+ (with negative outlook) credit rating up. 
 
Although the investors were generally unhappy, the Chairman and acting CEO were reasonably successful in diverting attention away from Vector's recent management chaos.  Three directors resigned en masse within the last year and both the Chief Executive Officer and Chief Financial Officer abruptly resigned five months ago.  Director Karen Sherry, a lawyer and political appointee with little business experience, had been put in charge of risk assessment for Vector in the midst of this drama.  Sherry has been a staunch supporter of Stiassny since his appointment. 
 
Questions from the floor included why cameras were prevented, when this was atypical for AGM's of public companies.  The Chairman responded that he did this to avoid the event turing into a circus. 

Vince Siemer was one shareholder unlawfully prevented access to the meeting.  A Sunday Star-Times photographer was another.  Stiassny filed a $1.25 million defamation claim against Siemer two and a half years ago but has done virtually nothing to advance the matter since.  In July of this year - when Siemer was on a two week trip overseas - Stiassny was able to get a High Court order from Justice Judith Potter that debarred Siemer from defending his defamation claim.  This issue is now before the Court of Appeal.  For two months the Court of Appeal has failed to schedule a hearing citing the large number of appeals Siemer has filed as one reason for the delay.  Potter was deeply involved with the Electricity Commission before her appointment as judge and has openly defended Stiassny in court.  Three of Stiassny's former lawyers now sit as High Court judges.  The judge that granted Stiassny his injunction against Siemer is a former chambers' partner of Stiassny's current lawyer Julian Miles QC.
 
The Sunday Star-Times photographer was noticeably shaken after two sentries from Force One Security followed him out to his car.  He phoned Siemer to ask that he come to the racetrack exit gate for a photograph so as to avoid another confrontation.  Later, when Siemer called SST's business editor Tim Hunter, Hunter told him that he could understand why Vector would prohibit Siemer from attending but that he had personally called Vector to "tell them that I was unimpressed" that they prohibited entry to the newspaper's photographer.  Hunter added, however, that this was not a worthwhile story.

Siemer, who has a bachelors degree in industrial relations and an MBA from Washington University in the United States and has run successful companies abroad, wanted to ask the directors questions regarding the goodwill, debt covenants and foreign currency risks.  In being denied entry into the meeting, Siemer drew a parallel with attempts to silence critics of ENRON ten years ago.  He considers it is no accident that no one on the Board other than Chairman Stiassny has comprehensive accounting or finance experience and has made a written request of each director asking them whether they personally agree with the company's current financial statements.  Siemer views the recent move to appoint Hugh Fletcher (husband of the Chief Justice of the Supreme Court) a director of Vector is little more than a political pressure move.  Hugh Fletcher's own business background, while extensive, is uninspiring.  Excluding Stiassny, the current directors of this $4 billion dollar essential service provider average less than a year on the board. ( back to front page)

NEW ZEALAND COURT OF APPEAL PRESIDENT CAUGHT IN CROSS-HAIRS

Dateline: 14 April 2007
In a ruling passed down by Court of Appeal President William Young this week, His Honour sought to quell a firestorm of controversy surounding three High Court judges - Judith Potter, Robert Chambers and Ellen France - accused of breach of judicial duty in acting independently to suppress evidence and pervert the course of justice on behalf of a prominent Auckland insolvency practitioner and New Zealand Law Society convener.    

The saga began in April 2005, when then newly appointed High Court  Judge Ellen France ruled she was incapable of seeing incontrovertible evidence placed before her in the form of a High Court report and affidavit showing [SENTENCE DELETED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM AT david.collins@crownlaw.govt.nz  TO ASK WHY].  This was potentially catastrophic to Staissny's professional survival because it seemed a simple accounting case; Paragon was not trading, had no debt and had $150,000 cash on hand at the time.  It was also before Justice France that Stiassny admitted to attempting to overcharge Paragon some $11,000 in fees as well as retaining - after earlier claiming that he never possessed - files relating to the company's intellectual property worth $750,000.  Stiassny emphatically claimed to Justice France both were honest errors.

Given the stature of Mr. Stiassny and the prominence of his lawyer, Julian Miles QC, Justice France took the easy route of issuing an injunction preventing publication of the evidence.  She had little idea at the time this ruling would come back to haunt her, made all the more certain because France J went two steps further in (1) ruling it was clear to her that Mr. Stiassny had not labelled the company insolvent and (2) it was equally clear to her that the attempted overcharge was an honest accounting error despite no evidence to support her finding other than Stiassny's unsupported claim this was the case. 

You could hear the proverbial pin drop when it was subsequently uncovered that the substantial fees overcharge did not come about in the manner Stiassny claimed to the Court to be the case.  Ironically it was Justice Willy Young who innocently suggested in November 2005 that Stiassny - who he called "a reputable accountant" from the bench - could quite easily put the matter to rest by producing bank records that showed the error, once discovered, was correctly charged to "Paramount" instead.  Oops.   A stern look from Stiassny's counsel let Justice Young know that this was not part of the plan and Young J never mentioned it again. 

Such an obvious epiphany would reasonably be expected to stimulate judicial remorse but, in the real world of the New Zealand Courts, it resulted in Justice Willy Young buttoning down the hatches.  By overstepping the bounds of law and evidence, Justice France had created a situation borne of a calculated gamble.  The deliberate nature of France's gamble would prove more than a little problematic in an appeals process geared toward correcting misinterpretation of laws and facts by judges, but one that goes legally blind and deaf and instinctively recoils when it becomes apparent a judge overtly dismissed laws and evidence.  Whatever judicial obligations Justice Young may have had, it was clear that keeping such judicial misconduct from being exposed was now his overriding aim.

This is an important juncture to note that despite a roster of nearly 200 judges in New Zealand, no judge has been removed for judicial misconduct.  In fact, several judges, including the recently retired Auckland High Court Justice David Morris, were appointed to judge to escape a summons (Judges are immune from prosecution).

When Justice France's decision was appealed to and heard by the New Zealand Court of Appeal in November 2005, Justice Young handed the matter over to Justice Robert Chambers, an admitted mate of the repondent and well known within the Court as an aggressive and highly opinionated lawyer-turned-judge.  Chambers, one of the more astute and intellectual judges, immediately identified that France's ruling was untenable but, in an effort to protect the judge's character, as well as to assist his good mate, embarked on a legal adventure of cunning genius.  He refused to overturn France's decision and even refused to address the validity of the points of appeal, choosing instead to say the matter was a contractual dispute that singularly warranted dismissal of the appeal and maintaining of the injunction. But Chambers J had a further problem. The course he embarked on contrasted with the Ellen France judgment and was not a point that had been cross-appealed.  Consequently, Justice Chambers boldly wrote that by ruling this way he was merely agreeing with what Justice France thought - despite the fact that Justice France's judgment said the opposite on this point.      

There is an axiom in the Court that "you attack the judgment, not the judge", admittedly a difficult course when the issue is judicial misconduct.  If anything, this case proves what lengths certain judges will go to cover up misconduct when such misconduct is not handled, once exposed, in the congenial and euphemistic manner that minimally allows all the perpetrators to escape culpability. 

When charges of injunction contempt were advanced before Justice Judith Potter in December 2005, Potter was so incensed by the effort to expose what Justice France did that she took to conducting proceedings ex-parte and preventing cross-examination of witnesses.     Eight unimpeachable witnesses would later provide uncontested evidence to the Court of Appeal regarding Justice Potter's numerous breaches of essential legal procedures that were as shocking as they were unbefitting a first year law student, let alone a judge of Potter's standing.

Into this fray Willy Young, President of the Court of Appeal, was again forced in November 2006.  Within the close-knit judiciary, Will Young is well-known as a lawyer with a sordid past.  In his earlier days as a Serious Fraud Office lawyer, Mr. Young  intervenned to prevent his cousin being prosecuted in a share market fraud that saw many honest, hardworking Kiwis lose life savings.  A business partner of Justice Young's cousin subsequently took the fall alone.  Moreover, and despite this history, Mr. Young owes much of his appointment and rise through the judicial ranks to his brother Neville Young being a former president of the National Party, one of the two major political parties in New Zealand. 

The upshot to all this is even if Justice Young wanted to rise to the noble and trusted mandate of his judicial oath, his personal history virtually prevents him from taking the moral high ground with judges now under him.  Further, it has been disclosed by a Court insider that, perversely, Mr. Young owes his appointment to the Presidency of the Court of Appeal in 2006 in large part to his checkered past.  It is these skeletons in his closet that ensure he will not aggressively act to censure other judges who misbehave - thereby effectively insulating all judges from being held accountable by the President of the Court.  In the self-preservation world of the New Zealand Courts, it is considered imperative that one judge not have too much power over the others. 

This moral vulnerability was sadly evident when Justice Young issued witness subpoenas for Barristers Grant Illingworth QC and Mr. Colin Henry J.D in CA55/06 last November.   In response to receiving the witness summons, Mr. Illingworth breached legal privilege by deliberately sending client communications unsolicited to the Appellate Court and to opposing counsel.  Justice Young would later say that because he did not read them, he did not see where any privilege had been breached (he ignored the fact that opposing counsel was also sent copies).  Having effectively castrated Willy Young, Mr. Illingworth demonstrated his keen ability to further exploit Justice Young's past transgressions by insisting the witness summons be withdrawn.  Justice Young withdrew the witness summons after Illingworth made it clear he was not about to be put in a position that would force him to lie under oath to protect his career.  If Illingworth went down, he was going to take the President with him.  If nothing else, Justice Young understands plain threats.

Considering the personal baggage that Justice Young brought with him, it is perhaps not surprising that His Honour, President of the Court of Appeal Justice Young claimed that he could not find any fault with the conduct of Judge Judy Potter and evaded, by omission, having to address any of the damning evidence that Justices France and Chambers breached their judicial oath by their misconduct.  Further, Young insisted the evidence of Stiassny's perjury fell outside the narrow scope he imposed upon the hearing, despite the fact that well-established law required the Court to act pro-actively when it could be demonstrated that prior restraint (an active injunction) was obtained from the Court on spurious grounds. 

A private audio-tape recording of this Court of Appeal hearing reveals cross-examination of Stiassny's partner that demonstrated to the appellate panel that  [SENTENCE DELETED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM AT david.collins@crownlaw.govt.nz  TO ASK WHY].  As the judges quickly composed themselves, Justice Young called an abrupt end to the cross-examination, with Justice Mark O'Regan subsequently claiming that this implicit admission (the witness refused to confirm the evidence before Justice Young's intervention) could amount to nothing more than a minor point.  For her part, Justice Susan Glazebrook thought better of the situation after the lunch break and opined whether the court was a bit hasty in releasing the witness, then inquired of the appellant whether there were subsequent issues that he was unable to address with the witness as a result.  It seemed a nice gesture.

The story gets still "curiouser and curiouser" as Alice in Wonderland would say.  Remember the brother Neville that Will Young owes much of his career success to?  Neville now sits as director of the Electricity Commission, directly tied to the fortunes of Vector Energy, of which Stiassny is chairman and, but for the grace of Will Young, would be scrutinized by investors for accounting anomalies that have resulted in Stiassny valuing Vector's assets on the basis of replacement value and with the allocation of over 30% of the monopoly utility's current valuation to "goodwill".  [RELATED STORY LINK BLOCKED BY ORDER OF NZ SOLICITOR GENERAL - EMAIL HIM  david.collins@crownlaw.govt.nz  TO ASK WHY] #

Editor's footnote: Nothing in this article should be construed to suggest Neville Young is complicit in the actions of his brother or the Court in general.

NATIONAL BRAIN DRAIN - FACT or FICTION?

Date published: 14 March 2007
Dissertations on the 'brain drain' of skilled labour overseas have become part of the Kiwi culture, feeding the perennial debate in relation to how concerned we should be in this regard.  There is little question that, for a country of only 4 million people, New Zealand is overrepresented on the world stage in the success of its ex-pats.  The important question is whether the success of our intellectual exports comes at the cost of success at home.  While a simple question, it has inherent complexities that thwart a simple answer.

Any attempt to simplify the examination is fraught with peril, not only because of the abundance of often contradictory statistics but also due to the varying assumptions and methods that underpin the results.  As former US president Bill Clinton once famously testified, "It depends upon what the definition of 'is' is".

This aside, we will fearlessly attempt to strip bare the facts and provide an insightful view on the topic.  In doing so, it is first necessary to recognize that New Zealand is a migrant country.  Almost 20% of the New Zealand population is foreign-born.  Conversely, the OECD (Organization for Economic and Co-operation Development), a group of 29 developed democracies, conducted a study in 2005 that concluded 10% of native New Zealanders live abroad.  Two key reasons for these statistics should provide some comfort.  First, New Zealand (along with countries such as the United States, Canada and Australia) is classified a 'settlement country' by the OECD - in other words, countries that naturally appeal to immigrants.  Second, emigration is often driven by pulling factors in an international labour market, language skills, access to information and the financial ability of people to migrate elsewhere, as well as determined by the country's culture in relation to migrating.  All these factors make emigrating from New Zealand more appealing - and possible - relative to most other countries.    

But migration is not the core issue in this debate.  While New Zealand was experiencing annual net migration losses in the 1990's, this trend has reversed in recent years with a net increase into New Zealand of just under 20,000 last year.  The rub comes in the classification of 'skilled' or advanced education among the migrants and whether New Zealand is, in effect, giving away more that it is attracting.  On this issue, there is legitimate cause for concern. 

The 2005 Dumont/Lemaitre study for the OECD ranked numerous criteria on migration.  But on what many would consider a most critical statistic, New Zealand topped the list of OECD countries with 24.2% of its highly skilled citizens living abroad.  This contrasted with Australia - still high on the list at #5 - coming in at 14.5% of its highly skilled natives living abroad.  But there are other factors that accentuate even this disparity.   While the exchange of highly skilled workers to and from New Zealand within the OECD countries was basically a wash, Australia had an immigration flow of skilled immigrants ten times higher than its highly skilled emigrants.  And the United States was much better still with 16 times more skilled immigrants than emigrants.  This said, the picture for New Zealand undoubtedly improves when you consider non-OECD countries such as India and South Africa, just two countries providing a good influx of skilled immigrants to New Zealand.  

Of the OECD countries, the United Kingdom, Australia, the Netherlands and Korea are the top four birth places of emigrants to New Zealand respectively. 

In the 1990's New Zealand adopted a selective immigration policy based upon human capital that has resulted in net gains in highly skilled immigrants, increasing almost 25% in the first four years of the decade.   But the question still remains whether these skill levels are equal to those going overseas.  Interestingly, while it has been long accepted that better job prospects and higher wages overseas have drawn many of the brightest and best talent offshore, the OECD found no strong correlation between the emigration rates of the highly skilled relative to unemployment levels and per capita income.  This unexpected finding has been attributed by the OECD study to the historical aspects of the data being compiled.  Undoubtedly differences in wage levels, and in returns to education between sending and receiving countries, are significant drivers.  The empirical evidence is that higher wages overseas for comparable skills is still a major reason why many of the more highly skilled residents are leaving, although the strong economy and skills shortages are causing the government and business to be more aggressive in the retention of skilled natives. 

So what is being done and what can be done to retain skills at home and entice skilled ex-pats home.  This requires first an understanding of the primary motives for moving abroad as well as the likely priorities of, and opportunities for, those willing to move back. In a survey of 18,000 ex-pats by KEA New Zealand released last year, more than 40% of respondents said they are living overseas for economic reasons, such as a specific job or general career prospects, and 30% of them were earning more than NZ$100,000 per year (compared to just 3% of the population in New Zealand at the time).  By contrast, only 3% of those who expect to return say they will do so primarily for economic reasons.  Instead, family and lifestyle considerations are the overwhelming top reasons for intending to return.  While a slim majority stated an intention to eventually return to New Zealand to live, relatively few had imminent plans to do so.  The inference that New Zealand has more attraction as a retirement destination than a work centre should legitimately cause concern for those interested in New Zealand's future place in the World economy.
 
In talking with a number of these highly skilled ex-pats for this story (including a couple who have recently moved back) the biggest lament heard was the limited opportunity they perceive in the job market here, an environment that many in business considered parochial and incestuous, with a relatively small and personally close-knit group of business leaders defining the status quo.  Even for those who would make the wage compromise in order for the lifestyle they prefer in New Zealand, this lack of a dynamic business environment was cited as an unattractive proposition.  Strong community, social and/or family attachments developed in their adopted country (many ex-pats have spouses who are not New Zealanders) were also cited.  Another obstacle is that Kiwis in highly specialized fields, say in bio-research or software development, are often forced to look overseas to satisfy their professional ambitions.  

The government, aware of increasing competition for skilled migrants within the OECD and the unattractiveness of its tax policies relative to other OECD countries, is considering proposals that would offer limited exemptions on foreign based income or a narrow exemption on tax rules that are more comprehensive than the international norm in order to assist in the recruitment of talent back to New Zealand.  

For more information on Kea New Zealand www.keanewzealand.com

LEGAL AID FEES TOP $20 MILLION

Published 12 March 2007
Some law firms in New Zealand are receiving hundreds of thousands of dollars in fees for legal aid cases.

Information released under the Official Information Act shows the top earner from legal aid cases, Kensington Swan in Wellington, received $2.26 million in one year.

Recently the New Zealand Law Society said legal aid pay rates are too low and lawyers are quitting the scheme in droves.
But figures from the Legal Services Agency show that for the year ended June 2006 nine firms received more than $500,000 in legal aid.

Payments were made to more than 1,400 New Zealand lawyers and law firms - the top 50 claimants together shared $20 million in legal aid payments for the year.

LawFuel.com, a law news website, says many of the top legal aid payments went to firms that handle Maori land, fisheries and health-related work.

The $2.26 million to Kensington Swan, Wellington was followed by $950,380 to Sonja M Cooper, Wellington, $936,625 to Charl Hirschfeld - Barrister, Auckland Central, $880,245 to Rangitauira & Co, Rotorua, $862,969 to Rainey Collins, Wellington, and $768,141 to Powell Webber & Associates, Parnell.

STIASSNY IN FIRING LINE

-- first published 23/12/06

          Michael Stiassny (52, of St. Heliers Bay) has hit a rough patch in 2006. He was kicked off the Met Life board, forced to resign as chair of Metro Water and witnessed the only 3 directors with business skills abandon the Vector board because he refused to resign from that board two weeks ago.  At the same time, Vector management has revolted at Stiassny's specious public claims and promises of strong financial performance at Vector, coupled with his demand that Vector CEO Franklin and CFO Peter Fredricson then find a way to produce the numbers he has publicly claimed. CEO Mark Franklin in particular has had several confrontations with Stiassny over his belligerent personal style and inverted business approach since being recruited from Australia two years ago. In addition to almost doubling his own pay, Stiassny had to seek approval of a pay package approaching a million dollars per year in order to placate Franklin and thereby prevent an open and nasty revolt.
        Then there was Stiassny's declared war on the Commerce Commission last winter over the Commerce Commission's stated intention of taking over Vector (an electricity lines company) for unfair charging practices - coupled with Stiassny's threats of power blackouts if the Commerce Commission did not back down - as well as an active Court action that seeks to hold him personally responsible for losses suffered by the Trinity Foundation Ltd. in relation to a failed tax scam (see related story left column). In addition to all this, a formal complaint this month was laid with the NZ Police alleging Stiassny perjured himself in the Auckland High Court in relation to fee overcharging in his insolvency accounting practice.                                                   On 8 February 2007, Stiassny is before the Court of Appeal in Wellington in relation to an appeal stemming from his alleged perjury.
At Vector, John Goulter, Greg Muir and Tony Gibbs resigned Vector CEO Mark Franklin & CFO Fredricson from the Vector Board on 13 December 2006, citing the direction of the company and Stiassny's refusal to step down as their reasons for leaving. Their abandonment leaves Stiassny's girlfriend Karen Sherry and Shale Chambers, both with limited business backgrounds and virtually no board experience, and the vacillating Robert Thompson to govern the $3.7 billion dollar company (or $5.7 billion company according to Stiassny). Of particular concern to Vector investors was Staissny's replacing the now departed Goulter as chairman of the Risk and Assurance Committee with Ms. Sherry, virtually the only person who is blind to the risks imposed upon the organization by Stiassny.
One of many immediate challenges Vector faces is how to write off $1.7 billion in 'goodwill'. While most insiders recognize the current board is ill-equipped to deal with the challenges ahead, the board and management at Vector are taking some comfort that, as a monopoly provider of an essential public service, the Auckland and Wellington public have no option but to financially support the company until such time government or regulatory authorities follow through and step in to safeguard the company and consumers. Board member Shale Chambers, appointed only last August, is taking additional comfort in the fact that he was not directly involved in the financial mess that currently plagues Vector and has been kept in the dark in relation to the side deals Stiassny and Sherry have made.
Meanwhile, two former Auckland Energy Consumer Trustees have asked the Labour government to investigate Mr. Stiassny's conduct in relation to Vector. As if this was not enough trouble facing Stiassny, consumer advocate Penny Bright of the public watchdog Water Pressure Group was last week successful in advancing two Parliamentary select committee inquiries into Stiassny's conduct at Metro Water when Maori MP and party leader Dr. Pita Sharples tabled the complaints before Parliament. They include petitions asking for a parliamentary investigation into overcharging and collection practices that unlawfully targeted certain Metro Water consumers for bankruptcy.
In July, then Metro Water Chairman Michael Stiassny admitted that water charges in Auckland were going up 9.7% instead of 3% in order that Metro Water could fund other non- water related city expenditures, such as the $84,000 global working holiday that certain Auckland Councilors took a year ago. This admission followed a 'public' Council meeting held in May where Stiassny demanded the meeting go into 'confidential' session before he would discuss such financial arrangements that violate the public charter. Ms. Bright was arrested when she refused to leave the public gallery on the order of meeting Chair and Auckland Councillor Vern Walsh that the public leave in response to Stiassny's demand.
      Ms. Bright and the Water Pressure Group's case was bolstered last week when Auckland District Court Judge Nicola Mathers ruled that Metro Water has a legal obligation to follow its dispute process. It is uncertain whether Metro Water lawyers Chapman Tripp will be retained now that Staissny has been forced out. Earlier in the year Stiassny ordered Chapman Tripp to bankrupt Water Pressure Group member Moli Tevaga over a disputed $2,800 water bill rather than follow proper administrative procedures. Mr. Tevaga was adjudicated bankrupt in August. Metro Water spent $15,000 in legal costs. #



*************************************************************
Auckland City Council controls Metro Water Limited

SUBMISSION TO THE FINANCE and CORPORATE BUSINESS COMMITTEE
AUCKLAND CITY COUNCIL, Mr. Vern Walsh, Chairperson

Respectfully submitted by Vince Siemer, MBA 5 December 2005


Few things in life are as precious as a safe, reliable and affordable water supply. Next to air, water is the most essential human need.

Michael Stiassny is the current Chairman of Metrowater. My recent research into this man's business background has uncovered behaviour so alarming that I am compelled to bring this information to the Finance and Corporate Business Committee's attention today. Mr. Stiassny's conduct as I have witnessed it is so egregious that I can state forthrightly -
In my informed and considered opinion Michael Stiassny is not fit to be chairman
of any public company, let alone a company that provides such an essential
human resource as water.

In support of my claim to the Committee today that Mr. Stiassny is not only unfit to remain as Chairman of Metrowater, but that he may pose a threat to the safe, reliable and affordable supply of water to the public given his personally callous nature and reckless management style, I will draw a parallel to Mr. Stiassny's stewardship of another monopoly - Vector Energy.

Stiassny has publicly represented that he has grown Vector Energy from a one billion dollar company into five billion dollars within three years (Exhibit A). What he fails repeatedly to mention is that Vector, under his stewardship, has amassed a horrendous debt of $3.1 Billion (from $0.8 Billion just a few years ago).

RECKLESS FISCAL MANAGEMENT

Anyone can build a five Billion dollar house of cards if they are able to borrow enough money and place an intangible value on the result. Stiassny is preaching how he built a five billion dollar company but I submit to you that this is misleading and it minimally fails to acknowledge the tremendous debt that the consumer ratepayers - not Stiassny - are ultimately responsible for.

This is particularly ominous in the case of Vector for several reasons:

1) Interest rates have risen recently, and are projected to go higher still, meaning the debt that Stiassny created is increasingly encumbering the company. This increased cost must invariably be borne by the helpless consumers or taxpayers.

2) In July, Standard and Poors put Vector on a negative credit watch, stating "The potential negative outlook reflects the likely deterioration in financial metrics over the short to medium term" (Exhibit B).

3) This negative credit watch was despite the company's low-risk electricity network business, the scale and diversity of its operations and its robust service area.

4) Vector announced a 30% decline in profit immediately after the public share offering, the IPO date itself having been inexplicably moved up a week. Vector blamed the profit decline on increased electricity transmission costs of 15% and increased electricity maintenance costs of 35% over last year, and admitted this profit decline occurred despite higher selling prices being paid by the consumers (Exhibit C).

So what would you do if you were Chairman of this teetering mess? We know what Stiassny did - he threw a party! Despite credit rating pressures, huge debt becoming more expensive to manage due to rising interest rates and significantly declining profits, Stiassny elected to increase dividends to trust beneficiaries!

I submit to you today that this is not a rational action for a responsible manager, but it may help explain how Mr. Stiassny's official compensation has almost doubled in his short tenure at Vector.

Can the Auckland City Council afford to leave such a man in control of a valuable and necessary resource as water?

Vector would be relatively fortunate if Stiassny's poor fiscal management was its biggest problem. At a recent Institute of Directors presentation, Stiassny claimed to have made Vector a Half Billion dollar profit on the recent purchase of NGC alone! This pegging of value was apparently determined by extrapolation of the sum value of the 24.9% initial public share offering at the peak of its share-trading price after the recent float. To be sure, Mr. Stiassny's short-term capital gain claim had nothing to do with intrinsic value as determined by factors such as tangible asset value or even anticipated return on investment. Mr. Stiassny's half billion dollar short-term capital gain claim was as bold as any Enron accountant - and equally alarming! And Stiassny is a Chartered Accountant!

LEGAL INTIMIDATION AND BULLYING

And it gets worse. It is common knowledge that Stiassny initiated defamation proceedings against one former trustee of the Auckland Energy Consumer Trust and took legal action against another to prevent that trustee from voting against his retention of the Vector chairmanship. Consequently, Mr. Stiassny was re-elected by only two of the five AECT trustees. Given Mr. Stiassny's propensity to use the legal bludgeon to beat his critics into submission, it is quite possible that at least one of the two trustees who did vote for Stiassny might have done so for reasons having nothing to do with his abilities.

Please make no mistake. Even if Stiassny has not threatened you with legal action, his legal bullying tactics are tainting Metrowater (and Auckland City Council) directly. At the Institute of Directors meeting noted above, Mr. Stiassny began his presentation by gloating he was in the process of bankrupting the Water Pressure Group members protesting peacefully outside. Not only was there no cause for this outburst, it made many people in the room understandably uncomfortable. This behaviour was duly reported to the Energy Minister in a letter dated 25 October 2005 (Exhibit D). While Stiassny may be free to spend his own money in suing people who criticize him, it will prove scandalous in my opinion if the Auckland City Council has authorized Mr. Stiassny to use, in effect, water receipts (Metrowater funds) to legally bankrupt people he disagrees with, and without legitimate cause.

I have been fortunate to travel many places in the world. It has always impressed me in my travels that Kiwis as a group are the most resourceful and adaptable people on the planet and are particularly astute at cutting through all the propaganda in accurately assessing a situation when it comes to hand, and then taking the appropriate action. It pains me to see so many of these decent, conscientious people bullied and taken advantage of by Mr. Stiassny while the elected representatives with the power to cut off his legal war-chest wring their hands. Change is needed.



EXHIBIT A
INSTITUTE OF
DIRECTORS
in New Zealand Inc
Breakfast with Michael Stiassny

Topic: From a one billion dollar
to a five billion dollar business in three years - the evolution of Vector.

Michael Stiassny, BCom, LLB, CA, is a chartered accountant and senior partner of Ferrier Hodgson & Co in Auckland.

He has significant experience in insolvency, investigating accountant work, company restructuring and due diligence.

He is currently chariman of Vector, NGC Holdings Ltd and Metrowater Limited, as well as a director of a number of public and private companies, including Metlifecare and The Horticulture & Food Research Institute of New Zealand Limited. He is also a member of the Auckland Branch Committee of the Institute of Directors.

When: Wednesday October 19th. 7.15am for 7.30am
Where: The Northern Club, Princes Street, City
Cost: Members $35 Guests (with IoD Member) $40


EXHIBIT B

VECTOR AND NGC PUT ON NEGATIVE RATINGS WATCH

By NZPA
Tuesday 28th June 2005

Standard & Poor's said today it was putting Auckland energy company Vector and NGC Holdings on creditwatch with negative implications following Vector's announcement of a full NGC takeover bid yesterday.

Vector yesterday made a $3.40 per shares scrip and cash offer for the remaining 32.8% of NGC it does not already own ahead of the float of a quarter of its shares that will raise $593 million.

NGC shareholders will be offered 78c cash and the rest in new Vector shares.

S&P said if the IPO and acquisition proceeded under the terms and conditions expected, then the ratings on Vector and NGC were likely to be affirmed at BBB-plus with a negative outlook.

"The potential negative outlook reflects the likely deterioration in financial metrics over the short to medium term." S&P said.

A major part of the decision to affirm the rating will be an assumption that Vector repays its equity bridge, either from its IPO proceeds or other means, before the end of October 2005, the international rating agency said.

S&P said Vector's rating reflected the company's low-risk electricity network business, the scale and diversity of its operations, its robust service area, and current regulatory price-path certainty.

"In addition, Vector is expected to benefit from the broadening of its business profile that results from assuming full control over NGC's gas businesses, including its transmission and distribution business.

"These strengths are offset Vector's moderate financial profile, uncertainty regarding the level of Vector's final shareholding in NGC, and consequently the extent of the integration that will ultimately occur and the associated integration risks."

NGC's rating reflected its strong market position in gas transmission and distribution, its diversified revenue base, and its moderate financial profile as well as Vector's creditworthiness. "These strengths are mitigated by New Zealand's depleting long-term gas reserves and any implications arising from the current regulatory review of gas transportation," S&P said.

Vector expects to be listed on the exchange in the spring with a capitalisation of up to $2.38 billion.

NGC shares jumped 22c to $3.782 yesterday and rose another 3c to $3.75 today - well above the implied takeover price.

Last year, valuers Grant Samuel said the underlying value of NGC shares was in the $2.50 to $2.76 range.


EXHIBIT C
(photo image unavailable)


EXHIBIT D

25 October 2005


The Honourable Mr. David Parker
Minister of Energy
Parliament Building
WELLINGTON

Dear Mr. Parker

On 19 October 2005, Michael Stiassny gave a presentation at an Institute of Directors meeting at the Northern Club in Auckland titled
"How to turn a one Billion dollar business into a five Billion dollar business in three years - the evolution of Vector".

As an energy consumer and ratepayer, I was extremely troubled by several aspects of Mr. Stiassny's presentation. These were:

1) Chairman Stiassny claimed to have increased the value of Vector a HALF BILLION DOLLARS solely through his orchestration of the recent NGC buyout by Vector.

2) Under his tutelage Vector shareholders have enjoyed increased dividends.

3) While accepting regulation of monopoly enterprises is here to stay, Stiassny suggested the shareholders and particularly those in attendance could appeal, as voters, to their politicians for less intrusive regulations - regulations that tend to stymie growth.

The intrepid manner in which Mr. Stiassny bragged to the directors in attendance of adding a Half-Billion dollars to the value of Vector through the NGC purchase alone was as frightening as it was unsound. Minimally Mr. Stiassny confused the investor "honeymoon" after the recent float, combined with the market hype that accompanied this launch, with intrinsic value. In point of fact, Vector has recently struggled, with a 30% annual profit decline over the last year, and NGC had been independently valued at substantially less than Stiassny's claim - yet neither garnered a mention by him. Additionally, Standard and Poor's in July put Vector on a negative ratings watch, saying "the potential negative outlook is a result of an expected decline in financial metrics over the short to medium term".

Perhaps most alarming is the fact that all these dour developments have occurred within Vector despite a buoyant economy, increased selling prices and infrastructure changes at Vector.

That Mr. Stiassny raised dividends - and brags about this move - at a time of substantially declining profits, is reminiscent of Nero fiddling as Rome burned. Whether any argument can be made for increasing dividends at a time of drastically declining profits, it is not difficult to deduce the motivation for such a payout in these circumstances.

Vector blamed the recent poor financial performance on substantially increased transmission and maintenance costs under Stiassny's stewardship. Not only does this speak poorly of Mr. Stiassny's fiscal management - or lack thereof - but it has profound and far-reaching implications to the consumers in particular and the economy in general. This is because, unlike other businesses and industries where the consumer has a choice and can avoid an inefficient and poorly run business that does not provide value for the money, Vector provides an essential service in a monopoly environment. While the consumer and ratepayers are not compelled to foot the financial bill for inefficiencies and poor performance in typical businesses (they simply choose another supplier of the good or service) this cannot be said about Vector. In fact, any poor management performance by Mr. Stiassny must invariably be financially underwritten by the unsuspecting and captive consumer and ratepayer beneficiaries.

As a monopoly enterprise, this is particularly true if Mr. Stiassny is able to increase prices to offset poor management of such a vital industry. In this scenario, the economy at large is directly and negatively impacted through inordinate cost pressures on the productive sector and pressures upon inflation in general. Hence, Mr. Stiassny's mantra that regulation might be softened through the collective voice of the voters was most disturbing.

I was deeply troubled by Mr. Stiassny's presentation and posed the question to him at the conclusion of his talk - a question made all the more relevant by my observation that such contrived and inaccurate financial outlooks are typical of businesses under Mr. Stiassny's stewardship that I have examined - to "name two companies where your stewardship resulted in a tangible benefit to shareholders?". In response, Mr. Stiassny claimed that Vector was one such company - evidenced, he said, by the increased share value after the IPO launch. I responded that this was a result of market hype - as he himself had conceded - and had nothing to do with fundamentals such as return on investment. At this, Mr. Stiassny went silent and the moderator called an end to the questions and the presentation. Mr. Stiassny was unable or unwilling to name one other company.

As an interesting anecdote, Mr. Stiassny devoted the first five minutes of his presentation attempting to explain away the half dozen protesters carrying placards outside the meeting, with messages such as 'Stiassny the Corporate Thug' and 'Dump Stiassny', as people who were not paying their water bills - "not because they couldn't afford to but because they didn't want to". He went on to say slyly that this is why we have people around "called lawyers" to deal with these people and that he was in the process of bankrupting these protesters! His vitriolic rant at the protesters was not only an unwelcome concession to the effectiveness of their peaceful demonstration but made many people in the room quite uncomfortable.

Few omens present themselves with such clarity. In my honest, informed and considered opinion Mr. Stiassny's presentation to the Institute of Directors breakfast meeting on 19 October 2005 portends an ominous threat to the energy sector, as well as the economy in general. As such, it would be prudent for you to obtain a copy of Mr. Stiassny's presentation so that you might judge this for yourself. With all due respect, like the canary in the coalmine, we can ill-afford to ignore the warnings.

One final note: Do not expect the Auckland Energy Consumer Trustees to provide a safeguard against Mr. Stiassny. Tellingly, Mr. Stiassny was re-elected Chairman of Vector despite the fact that only two of the five trustees voted for him. Mr. Stiassny had taken legal action against one of the trustees at the time of this vote and had previously engaged lawyers to threaten suit against another trustee for defamation after she spoke out against him. In this environment, it is also not difficult to see how two of the five might vote for him. (In the interests of full disclosure, I will tell you that Mr. Sitassny has also filed a million dollar defamation lawsuit against my company and me.) Moreover, it is my understanding today that Mr. Stiassny has all of the existing trustees currently tied up by a confidentiality agreement that provides him legal recourse against them if they speak out against him. If this is indeed the case, it is unreasonable to expect any of them to blow the whistle until after this ship is well and truly sunk.

Sincerely,


Vince Siemer, MBA
27 Clansman Terrace
Gulf Harbour

Mr. Mark Weldon
Cc: The Hon. Harry Duynhoven New Zealand Share Exchange
Associate Minister, Energy PO Box 2959
Parliament WELLINGTON
WELLINGTON
AECT Trustees (Shale Chambers, M.
Mr. Bruce Sheppard Buczkowski, John Collinge, W. Kyd, K.
NZ Shareholders Association Sherry)
P.O. Box 6310 Faxed to 09 978 7516
Wellesley Station
AUCKLAND The Hon. Dr. Michael Cullen
Deputy Prime Minister
Mr. Tim Hunter Parliament
Editor, Sunday Star-Times WELLINGTON
P.O. Box 1409
AUCKLAND

Mr. Michael Stiassny
Vector Energy
Faxed: 09 978 7799