LawNews- Issue 17

■ CULTURE Legal workers rank their firms

P06-07

■ FRANCHISING

Staying on the right side of the law

P12-13

Supreme Court to rule on scope of fiduciary

adls.org.nz

DUTY

Contents

LawNews is an official publication of Auckland District Law Society Inc. (ADLS).

Editor: Jenni McManus

Publisher: ADLS

Editorial and contributor enquiries to: Jenni McManus 021 971 598 Jenni.Mcmanus@adls.org.nz

Reweti Kohere 022 882 2499 Reweti.Kohere@adls.org.nz

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Cover: Sally Anscombe / Getty Images

As the Supreme Court prepares to hear ABC, two senior barristers debate the scope of fiduciary obligation

Photo: RyersonClark Getty Images

Supreme Court to put the expansion of fiduciary obligations under the microscope

Reweti Kohere

Does a fiduciary relationship exist between a parent and child?

The answer will be determined by the Supreme Court in a longrunning dispute that is scheduled for a hearing in just over a week.

The case A, B and C v D and E Limited as Trustees of the Z Trust is a claim borne out of a father’s “egregious” behaviour toward his children.

At issue is whether an abusive parent continues to owe fiduciary duties to his adult children in a situation where the bulk of his property has been gifted to a trust to deliberately thwart any meaningful claims, under the Family Protection Act 1955, that his children may have against his estates.

If the Supreme Court follows Australian law, it will likely find there is no fiduciary relationship in this case. But it might prefer the Canadian position, where the parent-child relationship is viewed as inherently fiduciary.

To date, New Zealand has followed Canada’s lead in recognising a fiduciary relationship between parents and children but the scope of the relationship is yet to be settled.

The case, and the development of fiduciary relationships law, was the backdrop to a panel discussion at ADLS’ recent Cradle to Grave conference, with Auckland barristers Anthony Grant and Andrew Steele debating the likely direction the Supreme Court will take after hearing the appeal in ABC

The children allege their deceased father’s fiduciary obligations stem from his physical, mental and, in respect of his daughter, sexual and emotional abuse when they were minors. Moreover, they say, he continued to owe fiduciary duties to them

as adults to protect their economic interests, provide for them from his wealth and recognise them as members of his family.

The children have sought an order that the assets gifted to the trust should revert to their father’s estate.

“Why are we here? It’s because Anthony and I disagree on the development of the law in this area,” Steele told attendees.

“He looks at the minority judgment in the Court of Appeal and says ‘yeah, this is the way we should go’. And what I say is, ‘Chirnside v Fay has been the law since 2006. It’s completely undiminished. It’s like the Rock of Gibraltar for fiduciary relationships in New Zealand. It reflects the law overseas’.”

Previous judgments

In ABC, the father ceased virtually all contact when his children left home. Later, they chose not to lay complaints with the police or start proceedings against him. Some 30 years after contact ceased, the father gifted his assets, worth hundreds of thousands of dollars, to a trust whose beneficiaries were the children and grandchildren of his friend. He didn’t name his own children as beneficiaries.

High Court Justice Cheryl Gwyn in November 2021 found the father owed fiduciary obligations to his children, based on their “inherently fiduciary” relationship. He breached those duties twice: first, through the “egregious” abuse he inflicted on them, particularly his daughter, as children. And second, when he transferred the property to the trust deliberately to ensure his estate wouldn’t be available to meet his adult children’s needs.

Continued on page 04

The children allege their deceased father’s fiduciary obligations stem from his physical, mental and, in respect of his daughter, sexual and emotional abuse when they were minors

To date, New Zealand has followed Canada’s lead in recognising a fiduciary relationship between parents and children but the scope of the relationship is yet to be settled

While the inherently fiduciary relationship ceased upon the children becoming adults, Justice Gwyn held the father’s relationship carried particular obligations due to the vulnerability his earlier breach of fiduciary duties had caused them.

Nearly a year later, the Court of Appeal was split. The full Bench allowed the trustees’ appeal against the father’s two sons, saying they couldn’t have trusted him to provide for them in his estate as they ceased to rely on him after they left home. But the court was divided when it came to the daughter’s claim.

Then President Stephen Kós held, and Justice Murray Gilbert assumed for argument’s sake, that the father owed a duty not to harm his children as minors. However, the majority found the fiduciary duty to refrain from acts that, as Justice Kós put it, “fundamentally violated” the trust inherent in a parent-child relationship, ceased when the father no longer lived with or cared for them.

In respect of the daughter’s claim, the fiduciary obligation could not evolve into protecting her economic interests as an adult – a duty Justice Gilbert described as “not only novel, but unprincipled”.

Justice David Collins dissented. Because the daughter had experienced “profound and enduring” psychological trauma arising from her father’s “appalling” abuse, it was impossible for her to live normally and independently – a situation similar to that of a severely disabled adult, relying on parents to continue caring for and supporting them.

“Such cases are best thought of as instances of a continuous relationship that is inherently fiduciary,” the judge said. Consequently, the daughter was entitled to expect her father to “atone” for his abuse and provide for her in his will.

Lost the plot?

The issue as to which direction the Supreme Court might follow arose when panel moderator and barrister Sandra Grant asked what role tikanga might play in ABC

Steele reminded practitioners that, based on the Supreme Court’s recent judgment in the Ellis appeal, Māori customary law would apply only if relevant. However, it couldn’t apply if it was contrary to statute or established legal principles.

While New Zealand’s fiduciary relationships law is settled in some respects, Steele said tikanga could prove helpful in one area. “Now that’s got your attention,” he told the Cradle to Grave audience, saying the court would be asked to affirm not only the existence of a parent-child fiduciary relationship, but also that it is inherently fiduciary, as articulated by Justice Andrew Tipping in Chirnside, between solicitors and clients, trustees and beneficiaries, doctors and patients, or parties to a joint venture.

Whether children can repose trust and confidence in their parents to create fiduciary obligations is a controversial issue

Anthony Grant

overseas.

“I can tell you Australia has rejected it,” Steele said. “There is no fiduciary relationship between a parent and their child in Australia so think about that before you move over there. They say ‘look, fiduciary obligations protect monetary interests – not non-economic or practical interests’.”

By contrast, New Zealand is headed in Canada’s direction. As Justice Collins explained, Canada has recognised parent-child relationships as having the hallmarks of a fiduciary relationship, including finding that an action for breaches of fiduciary breaches can arise where parents abuse their children. There, the fiduciary relationship arises from the children’s vulnerabilities and the parents’ power and authority.

Steele said he didn’t think the Canadian courts had “lost the plot”. “It’s grounded in established principle…I think [tikanga] is going to be influential – not necessarily decisive, but influential.”

Grant told conference attendees he had “no idea” what tikanga was. “I bought a book on tikanga the other day, which I haven’t yet read. But the suggestion there is a secondary form of legal system to which we’re all subject and which has not been written is a problem for me,” he said. “I just don’t know where we are going to begin, but there have been quite a few cases on it.”

Legal principles

When asked by the moderator whether he agreed with Justice Collins’ view, Steele said, “I see you’ve departed from the [list of] questions. This is what I was afraid of.” Amid the levity, he voiced his disagreement. “The reason the analogy doesn’t work, with due respect to the Justice, is because we need a relationship.”

Steele argued that fiduciary relationships arose, and corresponding duties kicked in, once someone assumed responsibility for caring for a child. If a disabled child was being looked after in an institution and the parent didn’t have an ongoing responsibility for that child, “do any of you suggest there would be a fiduciary relationship still, when there’s actually no relationship, no obligation to care for that person?

“We go back to Chirnside – let’s stick to legal principles…It’s pretty straightforward really: one party has expressly or impliedly undertaken to act for the other. The beneficiary has reposed trust and confidence in the fiduciary not to use their position in the relationship in an adverse way. In other words, be loyal – the keystone of fiduciary relationship law,” Steele said.

The Limitation Act also had an effect. Rather than seeking an account of profits or proprietary relief, cases of sexual misconduct involved claims for damages because the conduct was similar to the torts of assault and battery.

Continued on page 05

Because the daughter had experienced ‘profound and enduring’ psychological trauma arising from her father’s ‘appalling’ abuse, it was impossible for her to live normally and independently

Continued from page 04

Steele explained the Limitation Act stipulated that where there were equitable causes of action, the time limit to apply was analogous to the most similar common law right of action. For torts, the time to sue lasted six years. The limit would start once the children became aware of the wrong done to them.

“The way [Justice] Collins has portrayed fiduciary duty, there is no time limitation period. Thirty years can pass by and they can still bring their claim.”

A balancing act

Grant said he was a great fan of English judge Lord Tom Denning, who based his dissents on doing what he thought was right.

When Grant looked at the ABC case, the daughter had been “absolutely destroyed” by her father’s “appalling conduct”. Steele might argue no remedy was available to her, but Grant asked whether attendees agreed that someone in her situation should have no recourse.

Steele was eager to respond. “Very nice of you to put words in my mouth, Anthony. I certainly do not say they have no remedy. Of course, they have a remedy – a remedy in assault and battery, that’s a tortious remedy,” he said.

Nonetheless, Steele questioned whether that was appropriate for a breach of fiduciary duty. The harm arose from a breach of loyalty, rather than a tortious act that causes suffering.

“If you’re sexually assaulted by a stranger, that’s one thing, right? But when you’re sexually assaulted by someone whom you look to, to look after your welfare, your interests, whom you can’t escape from [because] they’re in your home, it’s a whole different ballgame,” he said.

Once the children realised they could sue their father, the limitation time period started. However, they chose not to bring proceedings.

“Like all claims in law, you cannot sit on your rights. The

Limitation Act provides a specific public purpose and all common law jurisdictions have it: memories dim as things get older. And a potential defendant is entitled to know a claim isn’t going to hang over them organically, for 30 years. Time ran out on this,” Steele said.

“Anthony is saying ‘we should resurrect some new kind of action that sidesteps the Limitation Act to give this person relief when they sat on their legal rights’. I don’t know. You ask yourself, ‘where are the equities balanced there?’”

Just outcomes

The Limitation Act wasn’t appropriate in these sorts of cases, said Grant, who referred to a statute the State of New York passed in 2019 allowing survivors of childhood sexual abuse to sue their abusers and any enabling institution – regardless of when the abuse occurred. Such a statute was an example of a more appropriate solution.

He also referred to the Waitangi Tribunal and its work on recommending outcomes for “well-founded” historical and contemporary breaches of Te Tiriti o Waitangi.

“We, in this room, are all paying millions of dollars every year for the Waitangi Tribunal and historical grievances, which go back 100 to 200 years. And no one says, ‘The Limitation Act was six to 12 years; these people have no rights’. It’s quite wrong.”

Steele countered: if the Limitation Act must change, “then go to your parliamentarian. Don’t ask the court to ignore the legislation. It’s just not going to happen.”

Grant said “absolutely” the Act should be changed. But the courts existed to provide justice in the community for perceived grievances. “In this case, there is no doubt – Andrew doesn’t dispute at all the nature of the grievance. And the courts ought to have the power to achieve a just outcome. It’s very simple. It’s part of the judicial oath. That’s what they’re there for.” ■

Justice Gwyn held the father’s relationship carried particular obligations due to the vulnerability his earlier breach of fiduciary duties had caused them

Andrew Steele

Legal workers’ union ranks big firms for workplace culture, unpaid overtime

Nearly 50% of respondents report their work has had a negative impact on their mental health in the past year – a significant decrease from 2021, when nearly 75% reported their mental health had suffered because of work

Reweti Kohere

Legal workers in New Zealand’s private firms are the least satisfied with their pay and job, a new report from the Aotearoa Legal Workers’ Union (ALWU) has found.

The finding contrasts to those working for nongovernmental organisations (NGOs), barristers’ chambers or in the public sector, who report being more satisfied with their jobs, according to the New Zealand Legal Industry Employment Report 2022/23

Overall job satisfaction within the profession has come in at 6.7 out of 10. Broken down by workplace, barristers sole rate their satisfaction the best at an 8.3 out of 10, followed by NGO employees (8.1), those employed at chambers (7.7), public sector workers (7.2), private in-house lawyers (6.9), large private firm workers (6.6), medium private firm employees (6.3), and small private firm staff (6.2).

A closer look at the large firms, Ministry of Justice and Crown Law reveals higher job satisfaction within the public sector. Ranking the highest are ministry employees at 7.9, followed by Russell McVeagh (7.6), Dentons Kensington Swan (7.5), Crown Law (7.2), Chapman Tripp (6.7), Buddle Findlay and Meredith Connell (6.5), Duncan Cotterill (6.4), Simpson Grierson (6) and Bell Gully (4.4).

Bell Gully also scores the lowest satisfaction rating for hours worked (3.7) and workplace culture (2.9). In contrast, Dentons Kensington Swan respondents are most satisfied with hours worked (7.6). Russell McVeagh employees are the most satisfied with workplace culture (7.7) as well as pay (7.9). Crown Law

respondents are the least satisfied with pay, with a rating of 2.9 out of 10. The law firm with the lowest pay satisfaction rating is Bell Gully (3.5).

Nearly half of respondents report their work has had a negative impact on their mental health in the past year – a significant decrease from 2021, when nearly three-quarters reported their mental health had suffered because of work.

Again, significant variations exist between workplaces. Employees working at chambers or in NGOs are the most negatively affected (67%), closely followed by private firms with one to five partners (66%), then private in-house workers (57%). The least likely to report negative impacts are public sector workers (32%) and sole practitioners (33%).

Responses

LawNews asked several large private law firms for their overall response to ALWU’s report and job satisfaction and wellbeing results.

Bell Gully didn’t respond directly to the report’s findings or the job satisfaction results. However, in a statement, the firm said it has several programs to recognise and reward, including a formal time-offin-lieu policy, annual performance bonuses, monthly financial rewards and active management of workflows and leave.

Support is provided, including additional staff where required, to bolster existing staff. And its people are regularly engaged with on their mental health and wellbeing, including through surveys and development opportunities. Bell Gully was confident the surveys accurately reflected how employees felt about their workplace. “We are always looking at how we can

improve the ways we support all members of our team and that includes ongoing encouragement of open communication within the firm,” it said.

Similarly, Russell McVeagh didn’t respond directly to the report’s findings or the job satisfaction results. But in a statement the firm said its extended hours policy guaranteed time off in lieu or catch-up days for people needing to work extended hours to meet client needs. The policy ensured staff were rested while giving management visibility and transparency over their work hours, to then make sure workloads were reduced where necessary.

In addition to having a range of wellbeing initiatives, the firm reviewed salaries each year. In 2022, all staff received an out-of-cycle 7.5% increase to their salaries, “to acknowledge that the last few years we have been operating in a challenging environment with the impacts of the pandemic and increasing cost of living”, Russell McVeagh said. “We know our people are critical to our success and appreciate their commitment to our clients and each other. We will continue to consider ways in which to support them.”

While Buddle Findlay didn’t respond directly to the report’s findings or the job satisfaction results, in a statement it said, “We pride ourselves in creating the best environment for [our people] to belong, thrive, and grow their careers.”

Regular engagement surveys provided “reliable and detailed” information on a range of workplace aspects, including remuneration, satisfaction and wellbeing. “The scores from our surveys place us ahead of industry benchmarks for professional services both in New Zealand and overseas,” it said.

Overtime wasn’t paid for every single hour worked above the industry standard of 37.5 hours a week, but it was acknowledged through time off in lieu, flexible work, vouchers, and other forms. “Our people are paid above the living wage at all times,” Buddle Findlay said. The 2022/23 living wage hourly rate is $23.65, and will rise nearly 10% to $26 an hour from September 2023.

Chapman Tripp, Simpson Grierson and Duncan

Continued from page 06

Cotterill were contacted but failed to respond.

No reason

The employment report also reveals the average legal worker is working nearly a day for free each week.

The average amount of overtime worked each week since 2021 has jumped a quarter, with legal workers on average working nearly six hours more than they are contracted for.

Of the 307 survey respondents, more than three-quarters (78%) report they usually work more hours than they are legally obliged to, with the amount of overtime higher in private firms of all sizes than in the public sector. In large private firms, overtime is especially common, with 92% of respondents reporting extra hours.

In almost all cases, their overtime isn’t remunerated or formally recognised in their employment contracts: 84% say their current employer doesn’t pay overtime and 78% have never been paid for working overtime in any way.

Where employees are compensated, it’s mostly in gift cards and other non-monetary forms and is largely discretionary. More than two-thirds of respondents report never having been offered time off in lieu by their employers.

“It’s time for legal employers to pay their staff for every hour they work. There’s no reason firms can’t pay their staff for all the hours they work – they’re charging clients for it,” says ALWU co-president Ollie Neas. “Paid overtime is not only the fair thing to do, it’s also essential for addressing the well-known problems with law firm culture.”

Paid overtime ‘essential’

In response to sexual harassment claims by former Russell McVeagh clerks and the firm’s broader workplace culture, Dame Margaret Bazley in 2018 recommended a formal system of paid overtime was “urgently needed” as the discretionary system of “catch-up” days and gift cards was unfair and didn’t work in all cases.

Neas says paid overtime will push firms to properly manage and resource their staff, helping make firms safer by helping reduce burnout and overwork.

“Paid overtime…is essential to changing this culture to ensure that the law is a safe and inclusive profession to work in.”

The overtime survey results support anecdotal “evidence” ALWU says it has received of firms seeking to increase their bottom lines without increasing staff numbers, by getting more work out of existing employees.

A possible explanation, the report states, is that it has become harder for legal workers to insulate their home lives from the demands of an increasingly connected workplace, given the greater provision for working from home following the pandemic.

Neas says it’s not right that legal workers are being “squeezed” to increase profitability. “The average legal worker in New Zealand is working nearly a day for free each week. That’s six hours of work which the employer can bill to the client without paying for the work.

“This is happening in a context in which a significant number of legal workers continue to effectively be paid below the minimum wage or have seen pay cuts in real terms over the past two years because of inflation,” he says.

The report reveals the number of legal workers working for less than the minimum wage rose 50% in 2022, and junior lawyers’ median salaries have either fallen in real terms or have just kept up with inflation. ■

Glaister Ennor is proud to announce the appointment of Michaela Barnes to the Partnership as of 1 June 2023

With this appointment, Michaela solidifies her position as a highly accomplished and dedicated Family Law Specialist. Her exceptional expertise in Family Law and Relationship Property, commitment to compassionate and practical results and her unwavering professionalism have made her an invaluable asset to the firm.

Michaela joined Glaister Ennor in 2018 and quickly distinguished herself as a top performer, consistently providing exemplary service to her clients. Her ability to navigate complex and difficult Family matters with finesse and compassion has earned her the respect and trust of both clients and colleagues alike.

Throughout her career, Michaela has demonstrated an unwavering dedication to achieving positive outcomes for her clients, she focuses on solutions that prioritise the best interests of the families she serves.

As a Partner, Michaela will continue to provide exceptional legal counsel to her clients. Her promotion not only recognises her outstanding achievements, but also reflects the firm’s commitment to nurturing and advancing talent from within.

The entire team at Glaister Ennor is delighted by Michaela’s appointment as Partner and looks forward to the continued success and growth she will bring to the firm and clients. We congratulate her wholeheartedly.

Can the criminal laws be reformed?

This week we will explore some of the alternative models of justice that have been proposed to address the critiques of criminal law and create a more just and equitable system.

Restorative justice

Restorative justice aims to repair the harm caused by criminal behaviour rather than merely punishing the offender. Unlike criminal law, which tends to be adversarial and punitive, restorative justice is collaborative and focuses on the needs of the victim, the offender and the community.

It recognises that crime is not just a violation of the law but also a violation of the relationships between individuals and the wider community. By bringing together the parties involved in a crime, restorative justice seeks to repair the damage caused by the crime and to restore those relationships.

Restorative justice is based on several principles that differentiate it from criminal law. First, it recognises that crime is a violation of people and relationships, not just of the law.

Second, it is collaborative, with all parties involved in the process. This means victims, offenders and the wider community are all involved in the process of repairing harm and restoring relationships. Third, the process is driven by the needs of those involved, meaning it is flexible and can be adapted to meet the needs of the people involved in each case.

Restorative justice can take many forms. It can involve face-to-face meetings between the victim and the offender, facilitated by a trained mediator or facilitator. It can also involve community meetings, where the wider community is invited to participate in the process of repairing harm and restoring relationships.

One of the key benefits is that it can help to address the root causes of criminal behaviour. Rather than simply punishing offenders for their actions, restorative justice seeks to understand the reasons behind the behaviour and to address those underlying issues. For example, if an offender has committed a crime due to addiction or mental health issues, restorative justice may involve connecting that person with the support and resources he or she needs to overcome those issues.

Restorative justice also has the potential to reduce reoffending. By addressing the root causes of criminal behaviour and providing support to offenders, it can help to prevent them from committing further crimes.

There is evidence for this: according to a 2008 evaluation by academics at the University of Sheffield commissioned by the Ministry of Justice, those offenders who participated in restorative justice committed statistically significantly fewer offences (in terms of reconvictions) than those who did not. In addition, restorative justice can help to build stronger, more resilient communities by fostering a greater sense of connection and understanding among individuals.

Ideas akin to restorative justice have been practised in many cultures and are often deeply rooted in non-Western traditions. For instance, the Navajo tradition of “peacemaking” has a lot in common with restorative justice. The Peacemaker Program in the Navajo Nation coexists with the formal tribal court system and its purpose is to bring parties together to talk through disputes and reach an agreement, with the peacemaker acting as a facilitator.

The downside

Despite its potential benefits, restorative justice is not without its challenges. The first is that it is not designed to settle factual disputes. It isn’t an adjudicative process and there is no factfinding mechanism. So, if the accused denies that he or she behaved wrongly, restorative justice may not be appropriate.

The second is that the restorative justice process may not account for power imbalances in the relationship between the victim and the offender. For instance, in the context of sexual and gender-based violence, Sarah Deer and Abigail Barefoot write, “the lack of a formalized structure may actually allow the offender to re-victimize and re-traumatize a survivor through threats (direct or implied) and intimidation… [and] even where direct safety and well-being are well protected, [restorative justice] models can still marginalize the psychological needs of victim/survivors”.

Professor Leslie Thomas KC

By focusing on repairing harm and restoring relationships, restorative justice has the potential to address the root causes of criminal behaviour and to build stronger, more resilient communities

In the final of a two-part series Do we need criminal law?, Professor Leslie Thomas KC considers three alternative approaches to criminal justice

Professor Leslie Thomas KC

Continued from page 08

This can, of course, be mitigated using skilled facilitators who can keep victims safe. But there will be times when restorative justice is not an appropriate or safe option.

The third significant critique is that restorative justice is not always enough. There are times when a person genuinely poses a danger to public safety and some kind of measures need to be taken to protect others from them, which a purely consensual process cannot necessarily achieve.

For example, Deer criticises an anecdotal account of a case handled by a Navajo peacemaker in which it was known that a child was being sexually abused by one of two possible suspects, neither of whom admitted it. The peacemaker’s solution was to isolate the child from both people and make sure the child was never alone with either.

Deer is highly critical of this response, stating, “There is no evidence that the peace-making system acknowledged the psychological harm suffered by the child, and simply isolating suspected sex offenders from a child does not directly address the underlying criminal behaviour… There is no enforcement mechanism in place to prevent future harm. Furthermore, because the offender is not held criminally accountable by the system, [they are] apparently free to commit offences on other children… Some of the problems with applying a ‘peacemaking’ model of justice to rape include safety, coercion, the excusing of criminal behaviour and recidivism.”

A fourth, and closely related, limitation of restorative justice is that although it has been widely adopted worldwide, it has usually been adopted as an adjunct to the traditional, punitive criminal justice system, rather than a complete replacement for it.

Restorative justice is often used either as a diversionary alternative to prosecution or as part of the sentencing process. But in both cases, if the parties do not agree to restorative justice or the process breaks down, the spectre of criminal punishment continues to hang over the offender’s head.

And finally, a fifth limitation is that restorative justice does not address all the harms done to victims or meet all the victim’s needs. As Susan Herman of the National Center for Victims of Crime said in 2000, “Repairing the harm is often far more complicated than apologies and restitution and relationshipbuilding. It can require long-term sophisticated counselling, assistance with safety planning, relocation and any number of services required to rebuild a life… Many of victims’ needs cannot be met by individual offenders or small communities because there is only so much they can do.”

Despite these challenges, restorative justice has the potential to offer a more compassionate, collaborative and effective approach to justice than traditional criminal law. By focusing on repairing harm and restoring relationships, restorative justice has the potential to address the root causes of criminal behaviour and to build stronger, more resilient communities.

Community-based justice

Community-based justice is an alternative approach to criminal law that emphasises community involvement in justice processes.

This approach seeks to address the underlying causes of crime by addressing social issues that contribute to criminal behaviour. It aims to shift the focus from punitive measures to preventative measures by engaging communities in addressing the root causes of crime.

This approach recognises that crime is often a symptom of broader social issues, such as poverty, lack of education and social exclusion. Community-based justice is based on the principle that communities are best placed to identify and address these underlying social issues.

One example of community-based justice in action is the Koori Court in Victoria and New South Wales, Australia. The Koori Court is a specialist court that operates within the Victorian court system and is designed to address the overrepresentation of Aboriginal and Torres Strait Islander peoples in the criminal justice system.

The court is based on principles of restorative justice and community involvement and is staffed by a combination of legal professionals and elders from the local Aboriginal community. A similar Youth Koori Court has been implemented in New South Wales for eligible young people.

There is evidence that the Victorian Koori Court improves experiences within the justice system for the accused through the provision of a culturally appropriate court setting and process, the involvement of elders and community members in the court and the adoption of an inclusive approach by judges and legal representatives.

There is also some evidence that it may reduce recidivism rates. An empirical study of the New South Wales Youth Koori Court showed indigenous young people referred to the court were less likely to be sentenced to detention. They were also less likely to be re-convicted and less likely to be sentenced to detention at re-conviction, although the difference in reconviction rates was not statistically significant.

Community-based justice has the potential to be a more effective and inclusive approach to justice than traditional criminal law. By involving communities in the justice process, community-based justice can address the root causes of crime and provide support to those who have been affected by it. Community-based justice initiatives can also help to build trust between communities and the justice system, which can lead to better outcomes for everyone involved.

However, like restorative justice, community-based justice mechanisms such as the Koori Courts operate as an adjunct to the mainstream criminal justice system, rather than as a replacement to it. The Koori Court is an integral part of the state-run criminal justice system and although community elders are involved in sentencing decisions, it is the judicial

Continued on page 10

Despite its potential benefits, restorative justice is not designed to settle factual disputes

Continued from page 09

officer who makes the final decision.

So, this is unequivocally a reformist, rather than abolitionist, approach to criminal justice. The state and its courts still have the final say.

Transformative justice

Transformative justice is a relatively new concept that seeks to address the root causes of harm, violence and crime through a transformative process that empowers individuals and communities to build relationships and address systemic inequalities.

Unlike criminal law, which focuses on punishing offenders and maintaining the status quo, transformative justice seeks to create a new system of justice that prioritises healing, accountability and community building.

Transformative justice is based on the principles of accountability, empowerment and transformation. It recognises that harm is caused not only by individual actions but also by systemic inequalities and power imbalances. It seeks to address these underlying issues by creating a space for open dialogue, community engagement and personal growth.

An important facet of transformative justice is that, in general, it’s explicitly anti-carceral and abolitionist. Unlike restorative justice, which often functions as an adjunct to the mainstream criminal justice system, transformative justice advocates reject the mainstream criminal justice system and explicitly want to create an alternative to it, which doesn’t rely on the use of coercive state power.

Anthony Nocella explains the differences between restorative and transformative justice as follows:

Restorative justice stresses that the system is flawed, overworked, and retributive, but does not address why it exists, how it is racist, sexist, ableist, and classist, whom it benefits, and how it was developed. Transformative justice, on the other hand, is explicitly opposed to helping someone get arrested, imprisoned, fired from their job, repressed, or oppressed. It is about looking for the good within others, while also being aware of complex systems of domination. If the world is to transform, we need everyone to transform and everyone to be voluntarily involved in critical dialogue together.

One example of transformative justice in action is the Creative Interventions Toolkit, a practical guide to stop interpersonal violence developed by Creative Interventions. This toolkit provides a community-based, transformative justice approach to dealing with situations of interpersonal violence, including domestic violence, sexual harassment, sexual and assault, child abuse and elder abuse.

Not enough?

Transformative justice has the potential to create a more just and equitable society by addressing the root causes of harm and violence. It challenges us to rethink our understanding of justice and move beyond the limitations of the criminal justice system. It is absolutely something we should welcome. However, it is not without its challenges and criticisms.

As we have already heard, not everyone is satisfied with restorative justice approaches when it comes to serious violent and sexual harm. The same criticism arguably applies to transformative justice. Many victims of serious violent and sexual harm, and many members of the wider public, expect to see the perpetrator punished and are simply not going to be satisfied with a process that doesn’t involve the infliction of some form of punishment on the perpetrator.

Scott Berkowitz of the Rape, Abuse and Incest National Network articulated the view of many people when he told Buzzfeed News in 2013 that given the seriousness of rape, “a long jail sentence is always appropriate,” and that “Victims are looking for justice. For a crime this serious, justice includes punishment.”

This isn’t a view that we can simply write off as knee-jerk retributivism. It can be argued that any process in which coercive state power is completely absent and there is no prospect of the perpetrator being incarcerated runs the risk of a violent abuser being free to offend again.

Of course, abolitionists are not without answers to this point. Mariame Kaba said in an interview with The Next System Project, shortly after the election of President Trump in 2017, “Has the current approach ended rape and murder? Most rapists never see the inside of a courtroom, let alone get convicted and end up in prison. In fact, they end up becoming President.”

She has a point. The current criminal justice system was created by and for those with power. It isn’t particularly apt for addressing sexual and violent harm, especially when it is perpetrated by the powerful against the powerless.

Nonetheless, in discussing this issue we clearly can’t ignore public sentiment, not least because if the state simply abandoned the business of punishing people and left communities to solve their own problems, some people would take justice into their own hands and mete out violence to rapists and abusers.

In fact, there are some abolitionists who openly acknowledge this. In the anarchist zine What About The Rapists?, an anonymous author describes how they and their friends assaulted a rapist with a baseball bat to punish him. The author writes:

“We are tired of accountability processes that force the survivor to relive, over and over, the trauma of assault; that force the survivor to put their reputation on the line as “proof” of their credibility; that end up being an ineffective recreation of the judicial process that leaves the perpetrator scot-free, while the survivor has to live through this for the rest of their life… we are not sorry, and we will not stop: from now on, we will respond to sexual violence with violence.”

Pausing there, I imagine most of us would be uncomfortable living in a world with no judicial process, no trials and no appeals, where justice was delivered by vigilantes with baseball bats. I certainly would.

Continued on page 11

Repairing the harm is often far more complicated than apologies and restitution and relationshipbuilding

Continued from page 10

Despite these valid criticisms, transformative justice provides a valuable alternative to criminal law that focuses on healing accountability, and community building. It challenges us to think creatively about how we can address harm and violence and create a more just and equitable society.

Do we need criminal law?

We now need to confront squarely the question posed by this commentary: do we need criminal law? This requires us to choose between abolitionism and reformism. We’ve seen there are major problems with every aspect of the criminal justice system as it currently exists. It’s classist, ableist and racist and it fails to address the root causes of harm and conflict in society. But that doesn’t answer the question: can it be reformed or should it be abolished?

It’s not controversial to say that restorative justice is a good thing or that it should be more widely used. Restorative justice is used in many countries around the world, including the UK. It has produced good results and received widespread approval from academics, judges and policymakers.

But it generally functions as an adjunct to the formal criminal justice system, not a replacement for it. And as we have heard, restorative justice has limitations. It doesn’t have any kind of fact-finding process and so is unsuitable for adjudicating guilt or innocence.

Not all victims want to engage in it or feel safe doing so. It doesn’t necessarily tackle the structural causes of harm and violence. And as it functions as an add-on to traditional criminal justice rather than a replacement for it, offenders still have the spectre of conviction and punishment hanging over their heads. Similarly, community-based approaches to justice normally function as add-ons to the formal courts, not as a replacement for them.

Transformative justice, on the other hand, is more ambitious. In general, it’s an explicitly anti-carceral and abolitionist alternative to the formal justice system that rejects integration into the formal justice system. It is also a much more radical form of justice, that is rooted in anti-racist and anti-capitalist politics. It seeks to address the root causes of criminal behaviour

and to transform the conditions that lead to crime.

This approach recognizes that crime is often a result of structural inequality, oppression and violence and seeks to address these underlying issues through social and political change. Transformative justice emphasises the importance of community-based solutions and a focus on healing and transformation. And it is ambitious.

As we have heard, transformative justice schemes such as the Creative Alternatives toolkit are squarely designed to tackle the very types of harm to which restorative justice is often viewed as ill-suited, such as domestic and sexual violence.

However, we must also engage with criticisms of abolitionist approaches to justice. It must be acknowledged that in the real world, many victims and many members of the public demand to see the perpetrators of serious violent and sexual harm punished. That isn’t necessarily an intractable desire but it’s also not one that we can ignore when making decisions about public policy.

As we’ve seen, in a world with no criminal justice system we could expect to see not just transformative justice, but also vigilante violence. To that end, I’m not convinced that the immediate abolition of criminal courts, police and prisons is a feasible or desirable goal.

However, the exploration of these alternatives offers a valuable perspective on the limitations of our current system and the possibilities for change. We should acknowledge that criminal punishment can’t solve the underlying social problems that cause harm and conflict and often makes them worse.

We should challenge the gross inequality and injustice of our capitalist economy and the structural racism that often accompanies it, and push for all communities to have highquality education, housing, jobs and health care accessible to all. And we should expand the space for restorative, transformative and community-based approaches to conflict resolution.

If we can take these steps, the role of criminal punishment in our society will steadily diminish. ■

Professor

Leslie Thomas KC is a lecturer at Gresham College in central London ■

The Koori Court is a specialist court that operates within the Victorian court system and is designed to address the overrepresentation of Aboriginal and Torres Strait Islander peoples in the criminal justice system

How covenants and competition law apply to the franchise sector

Stewart Germann

There are no franchise-specific laws in New Zealand. However, as you would expect, existing laws protect franchisees, the main three being the Fair Trading Act 1986, the Commerce Act 1986 and the Contract and Commercial Law Act 2017.

There is no legal definition of ‘franchise’ but the rules of the Franchise Association of New Zealand define franchise as:

“The method of conducting business under which the right to engage in the offering, selling or distributing of goods or services within New Zealand includes or is subject to at least the following features:

■ The grant by a franchisor to a franchisee of the right to the use of a mark, in such a manner that the business carried on by the franchisee is or is capable of being identified by the public has been substantially associated with a mark identifying, commonly connected with or controlled by the franchisor; and

■ The requirement that the franchisee conducts the business or that part of the business subject to the franchise agreement, in accordance with the marketing, business or technical plan or system specified by the franchisor; and

■ The provision by the franchisor of ongoing marketing, business or technical assistance during the term of the franchise agreement.”

Restraint of trade

During the term of the franchise agreement, a franchisee is normally prevented from carrying on any competing business and may also be prevented from carrying on any other business, as his or her full-time attention is critical to the success of the franchise business.

The franchise agreement will also almost invariably contain a restraint of trade that will apply to the franchisee following the termination or expiration of the agreement or the sale of the franchise business to a third party. The length and area provisions of the restraint will normally be set out in a schedule and they will be subject to general legal principles governing restraints of trade.

The courts have recognised that it is reasonable for a person in the position of the franchisor to impose a contractual restraint upon any competitive conduct by a franchisee. Contractual restraints of this type are known as ‘restrictive covenants’ or ‘agreements in restraint of trade’.

Such agreements must not exceed the boundaries of the courts’ notion of reasonableness. There are two competing principles governing the courts’ decision-making process. The first is that it is reasonable for a person to stipulate that if he or she is willing to disclose all secrets of how to establish a particular business enterprise, then the recipient of the information cannot immediately terminate the contract and set up a competitive business, using the information that it has received during the course of the educational process. If the courts did not provide protection to franchisors in such situations, there would be no incentive for the owners of established businesses to share their secrets with others and enhance their business skills.

The second principle is that it is important for the well-being of the community that every individual should, in general, be free to advance his or her skills and earning capacity. The way these two conflicting principles are resolved is to require that a restrictive covenant must be ‘reasonable’ in its terms before it will be enforced.

The current position in New Zealand is set out in s 83 of the Contract and Commercial Law Act 2017. It states as follows:

“(1) The court may, if a provision of a contract constitutes an unreasonable restraint of trade, –

(a) delete the provision and give effect to the contract as amended; or

(b) modify the provision so that, at the time the contract was entered into, the provision as modified would have been reasonable, and give effect to the contract as modified; or

(c) decline to enforce the contract if the deletion or modification of the provision would so alter the bargain between the parties that it would be unreasonable to allow the contract to stand.

(2) The court may modify a provision even if the modification cannot be effected by deleting words from the provision.” What this means in practice is that if a franchise agreement provides for a three-year period of restraint when a two-year period would be considered reasonable, the covenant would be enforced to the extent that it could be rewritten by the court as being confined to a two-year term.

Continued on page 13

I believe MBIE’s advice could have better suggested options to accommodate individual circumstances and put the fundamental human right of everyone to come home at the centre of its decision-making

Stewart Germann

Continued from page 12

The ability of the courts to modify excessive restraints is constrained by the principle that terms that could never have been considered reasonable will not be modified. This is considered to be contrary to public interest that a person should be able to intimidate a contracting party by stipulating for a wholly unreasonable constraint and then have the court come to its rescue and rewrite the contract, so it falls within the boundaries of reasonableness.

What then is a reasonable restraint? There are two factors: area and time. For a franchise that teaches making coffee and running a café, an area of restraint would typically be confined to the area in which the franchisee is likely to establish goodwill. A person who establishes a café in Auckland is likely to establish goodwill that extends perhaps 200 to 400 metres from the site. There are so many other competing cafés that the goodwill would not extend much further than that.

The duration of a restrictive covenant should be such as will enable a franchisor to interpose a new operator who will have a reasonable time to secure the retention of the customers. In the case of a café, it is unlikely that this will extend beyond two years.

Cartels legislation

The Commerce (Cartels and Other Matters) Amendment Act 2017 is a recent amendment to the Commerce Act 1986. Key changes include the following.

Cartel conduct restrictions

The cartel conduct restrictions include the previous restrictions on competitors fixing prices as well as new restrictions on competitors jointly restricting output and market allocating.

Collaborative activity exemptions

This is a cartels exemption for permitted ‘collaborative activities’. Competitors can seek clearance for proposed collaborative activities if they give certainty that the proposed activities will not breach the Commerce Act.

Vertical supply contract exemption

This is an exemption for cartel provisions that are included in vertical supply contracts where certain requirements are met.

Because the cartels legislation impacts upon key areas contained in franchise agreements, it is important to explain the basis of a number of clauses that are commonly inserted in franchise agreements. Such clauses include approved products, approved services, restraint area, restraint period and location of a franchised operation.

As already stated, the restraint on competition clause is essential in any franchise agreement, but it must be carefully drafted so as not to infringe the Commerce (Cartels and Other Matters) Amendment Act 2017.

In relation to the restraint area, this should be defined as within a franchise or company-owned territory, for example, within 25 kilometres of a franchise or company-owned territory.

The purpose of the restraint area is to provide some protection to each franchisee and to encourage investment by all franchisees within the franchisor’s system, and also to provide some sort of protection to potential new members of the group.

The restraint period may be defined as one or two years and its purpose is to encourage investment by current and potential franchisees to build and operate their businesses. If any franchisee chooses to leave the group in the future, then the restraint period will provide some protection for the remaining franchisees. ■

Stewart Germann is a partner at Stewart Germann Law Office ■ Next week Criminalisation of cartels and the case law

Harmans is a long-established Canterbury law firm operating from modern offices in the Central City, located close to parking. We are committed to gender equality and the continued development of our lawyers’ skills and knowledge base.

Senior Lawyer or Associate – Seniors Law Team

A position is available for a senior lawyer or associate to lead, grow and manage our Seniors Law team. You must have sound knowledge and experience in seniors’ law, including wills, trust and estate planning, estate administration, ORAs, EPAs, rest home care and subsidy matters, and property ownership. Property law experience will be a requirement for this role, while prior staff management and team leadership would be advantageous. You will possess a desire and drive to build a practice of your own within the firm. There will be opportunity for career advancement for the right candidate.

As we value strong and long-standing relationships with our senior clients, you will have excellent inter-personal skills and be able to display empathy and patience. You will also need to be comfortable running seminars and writing articles on various topics affecting seniors, and have an ability to communicate clearly and effectively. We provide marketing resources to support this area of law.

Senior Lawyer or Associate – Trust Law Team

A position is available for a senior lawyer or associate to lead, grow and manage our busy Trust Law team. Both part-time and full-time candidates will be considered.

The successful candidate must have sound knowledge and experience in trust law, including the establishment, administration, reporting and winding up of trusts. They must also be ambitious and enjoy this field of law. Property law and other asset protection experience will be a requirement for this role, while prior staff management and team leadership would be advantageous.

As we value strong relationships with our clients, the successful applicant will possess excellent inter-personal skills. They will also need to demonstrate a desire and drive to build a practice of their own within the firm. There will be opportunity for career advancement for the right candidate. We offer a competitive remuneration package commensurate with experience, in a friendly, fun, and supportive professional environment. Flexible working conditions are negotiable.

Please respond by email with a curriculum vitae, academic transcript, and covering letter to Practice Manager, Julie.knowles@harmans.co.nz

ALL AREAS

ALL LEVELS WEBINAR

The four-day week

Webinar 1 CPD hour

Thursday 8 June 12pm – 1pm

Price from $80 + GST Presenters Charlotte Lockhart, co-founder and managing director, 4 Day Week Global and Helen Pryde, senior associate, Duncan Cotterill

Residential building risks

This webinar, presented by 4 Day Week Global’s co-founder/managing director and an employment lawyer, will cover how the four-day week works, why it’s gaining traction, how to advise clients about the employment-related implications and how to apply the model to the legal profession.

Webinar 2 CPD hours

Tuesday 13 June 4pm – 6.15pm

Price from $140 + GST Presenters Geoff Hardy, partner, Martelli McKegg and Mark Colthart, barrister, FortyEight Shortland Barristers

Chair Elise Markwick, partner, Martelli McKegg

This webinar will help those practising in property and construction law, including litigators, to understand what can go wrong on residential building projects and how to avoid or minimise common traps.

Tax issues and impacts in employment disputes

Webinar 2 CPD hours

EMPLOYMENT

Wednesday 14 June 4pm – 6pm

Price from $140 + GST Presenters Claire Mansell, barrister; Geoff Clews, barrister, Old South British Chambers and Jill Collins, technical specialist – legal services | ratonga ture – Manukau, Inland Revenue

This webinar will present perspectives, insights and case studies from employment lawyers, a tax specialist and an Inland Revenue representative to give counsel a better understanding of when tax issues will arise and how to manage them correctly.

Chair Rob Towner, barrister, Richmond Chambers

Examining Ellis

ALL AREAS ALL LEVELS SEMINAR

In Person | Livestream

2 CPD hours

Tuesday 20 June

4pm – 6.15pm

Price from $140 + GST Presenters Rob Harrison; Kingi Snelgar; Natalie Coates; Susan Gray and Bridget Irvine

Ellis is one of the most high-profile and controversial cases in Aotearoa New Zealand’s legal history. Behind the hype lie significant legal principles and learnings that will have implications for all legal practitioners.

Chair Judge Sanjay Patel

Word to the wise: Microsoft Word for lawyers

UPSKILLING ALL LEVELS WEBINAR

Webinar 1 CPD hour

Thursday 22nd June

1pm – 2pm

Price from $80 + GST

Presenter Carlene O’Meagher, customer success team lead, LawVu

Regulatory reforms and commercial changes

COMMERCIAL ALL LEVELS

WEBINAR

Learn new Microsoft word features and upskill yourself on other useful Word tools.

Webinar 1.25 hours

Tuesday 27 June 4pm – 5.15pm

Price from $100 + GST Presenters Andrew Skinner, director, Urlich Milne Lawyers and Gary Hughes, barrister, Britomart Chambers

This webinar examines the latest legal changes and regulatory reforms for building product suppliers and manufacturers, including the outcomes of the recent Commerce Commission market study.

North Shore Express Lawyers’ Lunch

Wednesday 7 June 12.30pm – 2pm Franc’s, The Strand, Takapuna, Auckland

Sponsored by MAS

Learn

Events July Tauranga After 5 August

Christchurch After 5

Thursday 29 June 12.30pm – 2pm Dux Central, 144 Lichfield Street, Christchurch

Sponsored by MAS

Newly Suited Night of Bingo Beats

Wednesday 5 July 6pm – 9pm

The Portland Public House, 463 New North Road, Kingsland, Auckland

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Central Auckland After 5

Wednesday 12 July 5.30pm – 7.30pm Pilkingtons, 41 Shortland Street, Auckland

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WILL INQUIRIES

Please refer to deeds clerk. Please check your records and advise ADLS if you hold a will or testamentary disposition for any of the following people. If you do not reply within three weeks it will be assumed you do not hold or have never held such a document

LawNews: The no-hassle way to source missing wills for $80.50 (GST Included)

Wellington Central Successful legal practice in one of Wellington’s most thriving and growing suburbs.

The practice focuses on the legal needs of the community and includes Property Conveyancing, Trusts, Wills, Estates and Elder Law. Would be well suited to an established law firm looking to expand, or an individual who is looking for an opportunity to operate independently.

Offices Available

Following some barristers retiring, we have three offices of varying sizes available for rent.

LUSCOMBE

Valerie Jean

• Late of Tauranga

• Retired

• Aged 71 / Died 27/09/98

MORUNGA

Louis James

• Late of 109 George Street, Hikurangi, Whangarei

• Separated

• Truck driver

• Age 57 / Died 24/03/22

WHITE

Errol Gillies

• Late of 41 Littlejohn Street, Hillsborough, Auckland

• Married

• Teacher

• Age 89 / Died 16/03/23

WOOD

Ryan Craig

• Late of Waikaretu Valley Road, Glen Murray, Huntly

• Apprentice mechanic

• Age 27 / Died 06/10/21

The Chambers share a refurbished floor (with separate areas) with Hussey & Co., a boutique forensic and general accounting firm. There are shared meeting rooms (a formal boardroom with video conferencing facilities and a less formal meeting room), and communal entrance and client waiting area.

Telephones, internet connection, printing and secretarial services also available and some furniture available.

Cost depends on office size and range from $150 – $300 per week plus gst. No long-term commitment required.

Photographs of the Chambers can be viewed at www.hco.co.nz/gallery.

Contact: Shane Hussey for further details, Shane@hco.co.nz 09 300 5481