Parliament's fine balance may produce useful business law
Colin James's Business Herald column for 3 May 2006
Stand by for an overhaul of seriously old property law. The government is at last moving on a 1994 report of the Law Commission -- thanks to last year's hairline election result and the irrepressible Sir Geoffrey Palmer.
Politicians of all stripes have two large pigeonholes -- one to stuff with reports they can't find the time to action and one for hiding reports they are too scared to action.
MMP greatly enlarged the first pigeonhole. Legislation moved more slowly. There wasn't room for the worthy, serious, technical recommendations the Law Commission produces and that business needs. Now there is room and Helen Clark made Sir Geoffrey Law Commission boss in December explicitly to raid its storehouse for work for Parliament.
Sir Geoffrey loves lawmaking. As Minister of Justice, he set up the commission in 1986 as a full-time independent body in place of a gaggle of part-time law reform committees.
At 64, Sir Geoffrey is as laid back as a new puppy, as otiose as a triathlete. With a political pro's nose for timing and opportunity, Sir Geoffrey called a press conference the day before Anzac Day to outline the commission's work programme.
Most subsequent media comment highlighted his call for more "truth in sentencing" to fit prison time served more closely to judges' sentences, particularly for sub-two-year terms, which are routinely shortened by two-thirds.
That is not directly relevant to business. But there could be spillovers affecting business from research by the commission into how to align customary justice in the Pacific (including here) with human rights.
And business would be likely to be benefit from the commission's push for better access to court records and legislation. It wants legislation extensively indexed and put on line so non-lawyers (and lawyers) can penetrate what is now a confusing maze.
Also relevant to business is work in progress on a law for a better incorporation framework for managing communally owned Maori assets and meshing that with commercial practice.
But more direct interest will lie in the raft of past reports dating back as far as 1988 which ministers have ignored.
Under Sir Geoffrey's prodding, some will now be actioned.
Top of the list is a bill due in Parliament in July to reform and encode property law from top to bottom. This covers all mortgage law and much else and has the nod from the cabinet.
The present act was passed in 1952 and includes some archaic language. Some property law stems from English statutes dating back to the thirteenth century.
A detailed report, with a draft bill, was tabled in 1994. This is itself now long out of date so Supreme Court judge Peter Blanchard, in earlier life a top commercial lawyer who wrote the original, has been updating it and drafting is well advanced on a new bill.
Also on the cabinet's agenda is a bill to fix two issues that have arisen in the 1996 Arbitration Act: confidentiality between parties; and whether the confidential nature of arbitration should ³yield to the principles of open justice when the parties have recourse to the court². The commission reported on this in 2003.
Both projects illustrate a new dimension in the commission's work: working with parliamentary counsel to produce not just a draft bill, as has been done in earlier reports, but one fully ready for Parliament.
Another law change due this three-year parliamentary term stems from a report tabled in 2004 on insurance contracts.
This has been incorporated into a Ministry of Economic Development overhaul of the law on financial products and providers. It includes a new framework for regulating and supervising life insurers and life insurance products.
Also on the longer-term legislative agenda, perhaps for next year, is a complex correction of "serious injustices" in apportioning civil liability, a matter of significant relevance to business.
The focus of the report, originally tabled in 1998 with a draft bill, was on occasions when a single loss is caused or contributed to by a single party. The draft bill includes provisions to allow concurrent wrongdoers to be ³jointly and severally² liable for damages and to extend the rights of wrongdoers to have their liability reduced because of actions of the wronged party.
This reform proposal predates the Law Commission, having been first made by a law reform committee in 1983 after an English law in 1978. An ordinary mortal outside politics might think it has now had sufficient gestation.
Another report that dates back to 1988 -- yes, 1988 -- has not yet made it on to the agenda. This deals with time limitation of defences in civil proceedings and has three central features a defence based on a standard limitation of three years; extension of this period in some situations (particularly where a claimant is unaware of the essential relevant facts); and a ³long-stop² limitation period of 15 years.
There are also reports on codifying the law that denies a killer rights to the victimıs estate or property (tabled 1997) and a draft Succession (Wills) Bill to bring together and codify all the law relating to wills. Both are on this year's legislative programme.
Should business get excited? Well, this is law so technical it isn't contentious between parties. That is, it is a big yawn to the uninitiate.
But it is the stuff of relevant government. Sir Geoffrey has his uses.