The Sunday Star Times (SST) has today reported that the NZ Climate Science Education Trust (“Climate Trust”) has asked Mr Justice Venning to disclose whether he held any financial interests under the Emissions Trading Scheme when he heard the trust’s recent case against NIWA.
In a discussion on Wednesday about the Climate Trust’s filing with the Court of Appeal, the SST reporter asked me about allegations of judicial bias. He claimed to have information that the appeal was based upon the judge’s forestry investments. I assured him that the appeal made no mention of bias and that this question had arisen only in the course of the current costs argument in the High Court.
At this stage, the Climate Trust has merely asked the judge a question by way of a Memorandum to the Court. Any issue as to whether Venning J should recuse himself from the costs dispute will not arise until his financial interests (if any) under the ETS are known.
In the internet debate which followed the September release of the substantive judgment in the NIWA case, a number of commentators drew attention to the complaint against Venning J lodged with the Judicial Complaints Commissioner by Dr Gary Muir and others associated with the Trinity tax case. That complaint was related to the judge being a director/manager/shareholder of Tahakopa Forest Ltd (“TFL”) the owner of a 200ha radiata pine forest in Southland, planted in 1992.
TFL has registered to receive carbon credits under the New Zealand ETS established in 2008 by the Climate Change Response Act.
A search of the company records revealed that Venning J had resigned as a director and sold his shares in TFL in April 2008. However, Dr Muir’s papers allege that TFL is merely the trustee for a forest-owning partnership in which Venning J (or his family) holds an ongoing 25% interest. It was appropriate, therefore, to ask the judge himself whether he still retains his earlier financial stake in the ETS.
The Climate Trust has argued that NIWA’s adjustments to historic records heavily over-state the warming that has actually occurred in New Zealand over the past century. NIWA’s projections of future warming are based on computer models which are calibrated to reflect those adjusted past records. If NIWA’s temperature predictions for 2080-2100 were sharply reduced, there would be no basis for government policies aimed at averting future dangerous climate change. Thus, the justification for an ETS will be severely undermined if NIWA loses this case.
Until recently, there were two distinct rules governing the circumstances in which a judge should declare a conflict of interest. Dating back to the 19th century was the House of Lords ruling that a judge may not have any direct pecuniary interest, however small, in the outcome of a case he is hearing. That was based on the principle that “a man may not be a judge in his own cause”. The other common law rule dealt with “apparent bias” and was based on the principle that “justice must not only be done but must manifestly be seen to be done.”
Last year, the Law Commission published an Issues Paper [hyperlink www.lawcom.govt.nz/.../lc2919-towards-a-new-courts-act-first] in response to a Member’s Bill introduced by Green Party MP Kennedy Graham which sought to establish a register of judge’s interests. This paper canvasses various viewpoints regarding circumstances in which a judge should recuse himself or declare an interest. It notes that New Zealand law was settled by the 2010 Saxmere case relating to then Justice William Wilson.
In Saxmere, the Supreme Court unanimously held that “a judge is disqualified if a fair-minded lay observer might reasonably apprehend that there is a real and not remote possibility that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide.”
The Law Commission remarks (p8): “The test is not always easy to apply insofar as it requires a court to anticipate how a fair-minded and informed lay observer would view matters. However, in relation to pecuniary interests it is hard to see how a fair-minded and informed lay observer would not regard a direct pecuniary interest as being disabling and disqualifying save where it is of the most minor and inconsequential kind.”
Tahakopa obviously has a significant pecuniary interest in preserving the ETS – but that issue is not “directly” in question in the NIWA case. If the judge has retained his interests in Tahakopa, the key question for recusal would be whether there is a “real and not remote” possibility that the outcome of the case might have an impact on future ETS policy.
These issues will only arise if Venning J retains a material pecuniary interest in the Tahakopa forest. That is the first question to be answered.