ANNEX 2

Tāpiritanga 2: Arotake ā-Ture

Annex 2: Judicial Review Described

Administrative law is the law that governs public bodies exercising public functions. This guide primarily focuses on an aspect of administrative law, namely judicial review, which is the legal process through which the courts oversee executive decision-making. However, administrative law also includes other forms of public oversight including public sector watchdogs like the Ombudsman and Auditor-General, statutory appeals, and public inquiries. A person who is aggrieved by a public sector agency’s decision may use one, or several, of these avenues for redress. Annex 3 contains more detail on the most applicable ‘watchdog’ agencies.

Administrative law is important for three reasons. It guides good decision-making by providing a set of principles that public bodies have to comply with when making decisions. It protects individual citizens against excesses or abuses of public power. And it ensures Parliament’s will is properly implemented by the government.

What is judicial review?

Judicial review is a legal process where individuals can challenge the lawfulness of a decision in the High Court. To decide whether the decision was lawful, the High Court has regard to a set of standards that have been developed by the courts over time.1 The Rt Hon Lord Woolf and Ors, De Smith’s Judicial Review (7th ed, Sweet and Maxwell, 2013) at [1-001].

A frequently cited description of judicial review is “the enforcement of the rule of law over executive action”.2Church of Scientology Inc v Woodward (1982) 154 CLR 25 at 70. A court examines the decision, to ensure the decision-maker remained within the bounds of the laws bestowing and regulating their decision-making powers and processes, based on precedent.  

How is a judicial review process undertaken?

An application for judicial review is submitted to the High Court in much the same way as civil proceedings, with an applicant filing a notice of proceeding and a statement of claim identifying the alleged grounds for review.3Graham Taylor, Judicial Review A New Zealand Perspective (4th ed, LexisNexis, Wellington, 2018), at 154.

The applicant bears the onus of proving on the balance of probabilities that the decision was unlawful.4Taylor, ibid, at 486-487.

The decision of the High Court may be appealed to the Court of Appeal, and ultimately to the Supreme Court. 

For a challenge to succeed, the court will need to be persuaded on the evidence that the decision-maker did not lawfully follow the process. If evidence is contested, the civil evidential standard applies (and a matter must be proved on the balance of probabilities). In most situations the decision-maker or their representatives will not need to attend the hearing to give evidence.

One important difference to regular civil litigation is that the applicant is likely to have access to decision-making information under the Official Information Act 1982, the Local Government Official Information and Meetings Act 1987 and/or the Privacy Act 1993. Subject to its consideration of withholding grounds under these statutes, the decision-maker must provide the applicant with access to the information, with only withheld material (such as legally privileged material) being subject to the usual court processes for discovery.5Taylor, ibid, at 305.

Evidence is usually provided by way of written affidavit. The affidavit involves the decision-maker stating the information that was before them and their reasons for coming to the decision, but cannot include an after-the-fact rationalisation of the decision. Cross-examination on affidavits can be ordered by the court if there are disputes,6Taylor, ibid, at 477. or credibility issues, but this is rare.

Reliance on existing statements of reasons can be useful for persuading the court that the decision-maker considered all the relevant matters, did not take irrational factors into account, and gave proper weight to all legal and factual considerations. While statements of reasons for a decision and other assessments or records of the decision-making process are not always mandatory for decision-makers (see question 22 for more detail), the existence of these documents is important in the event of a challenge as they can enable affected parties and the Court to understand why that outcome was reached. Some statutes impose mandatory statements of reasons on decision-makers, in which case failure to give reasons or giving inadequate reasons is a failure to comply with the law governing the decision-making process.7Taylor, ibid, at 309-310.

What decisions are subject to review?

Most public decisions made by the public sector are potentially subject to judicial review.  For example, judicial review of even the Crown’s contracting decisions is available but, in a commercial context, review will usually only succeed where there is evidence of fraud, corruption, bad faith, or any analogous situation, unless there is some other extenuating circumstance that give the decision a more ‘public’ nature and require closer court scrutiny. 

The decisions of private organisations performing public functions or exercising public power may also be reviewed.8See for example White v New Zealand Stock Exchange (No 2) [2002] NZAR 342, where decisions of the Stock Exchange and its appeal board were reviewed for natural justice breaches; Phipps v Royal Australasian College of Surgeons [2000] 2 NZLR 513, where an inquiry into a surgeon’s treatment of patients made recommendations about supervision without providing adequate opportunity to the surgeon to respond. The term ‘decision’ in this context usually means a final commitment to a definitive choice that is communicated to the affected party.9Taylor, ibid, at 162-163.  See however cases such as Peters v Davison [1999] 2 NZLR 164 where review of a finding of a Royal Commission for alleged error of law was allowed, even though the finding had no direct legal force.

National security matters also require special treatment when considering judicial review, given the processes in place for protection of classified information and the role of IGIS (see Annex 3). These matters require specialist advice.

What will a court look at in judicial review?

The nature and level of intensity that a review will take is a complex legal topic.

The willingness of the courts to intervene for the (overlapping) reasons of illegality (i.e. a decision-maker operating outside powers) or breaches of natural justice (such as failure to allow someone to be properly heard or concerns about bias or predetermination) has been settled for some time. 

However, much judicial and academic time and effort is spent on the questions of whether or not and when a court should intervene on the basis of ‘unreasonableness’, or more recently to test the proportionality of decisions or intervene in the weightings applied by a decision-maker.10See Joseph, Constitutional and Administrative Law, 4th Ed, at 23.2.3(4)   This creates some inevitable uncertainty about the level of scrutiny that might apply to any specific administrative decision. 

It is now relatively orthodox and uncontentious to say that the courts will apply a sliding intensity of review for the ‘unreasonableness’ of decisions, based on a range of factors.11See Pharmaceutical Management Agency Ltd v Roussel Uclaf Australia Pty Ltd [1998] NZAR 58  (CA) at 66, and Joseph, ibid, at 24.3 (for the rejection of Wednesbury as a doctrine of universal application), and at 24.4.2 (for the factors that will determine where on the spectrum the intensity of review may fall in any case).

The questions set out in Part 3 of this guidance are an attempt to navigate this issue in a practical way, without drawing the reader into the complexity of the case law or academic debate.

What will a court not look at in judicial review?

Courts will limit or refuse review of decisions involving high policy content, as the judiciary are not equipped, and are not the constitutionally appropriate body, to weigh policy considerations. However policies must be consistent with legislative requirements12See for example Board of Trustees of Salisbury Residential School v Attorney-General [2012] NZHC 3348, where BTSRS successfully judicially reviewed a decision by Minister of Education to close a residential school for girls with special learning needs and intellectual impairments.  The fact that the disestablishment decision was part of wider policy change on how to meet special needs did not obviate the statutory requirements on the Minister to consider alternative arrangements, in a situation where errors were found in the process and consideration of the alternatives. and significant changes to existing policies may necessitate consultation, breaches of which could result in a judicial review challenge.13McGechan on Procedure, at JRIntro.05(3) and (5).

A court undertaking judicial review will not generally review the substance of a decision or substitute its own decision, although there are some exceptions.14See, for example, Fiordland Venison Ltd v Minister of Agriculture and Fisheries [1978] 2 NZLR 341 where Woodhouse and Cook JJ granted a declaration that, subject to the upgrading of premises in accordance with plans that had been submitted, the appellant was entitled to a game packing house licence. Also Edwards v Attorney-General [2017] NZHC 3180, where an application first made in 1966 for a pension due to partial loss of eyesight during military service had been consistently and incorrectly declined, and substitution of the decision was appropriate where the relevant body to which a decision would be remitted no longer existed. 

For decision-makers, this restraint may be cold comfort.  The level of scrutiny involved in a broad review of their process, and the constraints that may follow as a result of a successful judicial review, may have a significant impact on the subsequent choices available.  Directions from the Court as to how a decision is to be made may substantially influence the final result.   

However, the general principle still holds – matters of substance are for the decision-maker not the court.15See Curtis v Minister of Defence [2002] 2 NZLR 744, where the Court of Appeal was not prepared to interfere with the decision to disband the Air Combat Squadron of the Royal New Zealand Air Force, regarding it as a political and not a legal issue.  In this manner the law balances the need for government to have independence in making decisions on public matters with the need to hold the executive accountable to the rule of law.

What if the legal action will make no practical difference to the matter?

Arguments about utility or lack of utility in terms of the relief that is sought often arise in judicial review, especially as court proceedings take time and matters may have moved on before the case is heard. 

Generally, a person prejudiced by a decision who has established that there was an error is entitled to relief.16Phipps v Royal Australasian College of Surgeons [2000] 2 NZLR 513 (PC) at [27]; New Zealand Employers Federation Inc v National Union of Public Employers [2002] 2 NZLR 54 at [125-126]  On the other hand, “the Court’s time is precious17Te Whakakitenga O Waikato Inc v Martin [2016] NZCA 548 at [39] and the courts may hesitate to proceed with matters where judgment can lead to no practical outcome or benefit.  One benefit may be the value in stating the law where similar decisions will impact on others.18Hudson v Attorney-General [2017] NZHC 1441 

Avoiding judicial review

The best way to prevent judicial review, or any other scrutiny of your decision, is to ensure the proper procedure is followed and recorded throughout the decision-making process. This Guide intends to assist you with this. Where you have any doubt about the correct process, seek advice from your in-house lawyer. This will save a great deal of expense, time and potential embarrassment to the government in the long-run.

A good record and evidence of proper process can be extremely helpful in the progress and outcome of judicial review cases.  Gaps in the paperwork can lead the court to draw an adverse inference – and may mean that an applicant succeeds in getting orders to prevent a decision proceeding in circumstances where the decision is valid but that validity cannot be easily established.  Gaps in the record may also prevent an early successful argument that there is no merit in a challenge and mean that the Crown has to go to a full hearing and cannot strike out meritless cases easily.

If there is uncertainty in regard to legislative or regulatory requirements, such as whether considerations are mandatory or discretionary, consider whether the legislation or regulations can be amended to frame criteria more clearly without losing the policy intent.

What orders will be made?

At the start of the matter, the applicant may seek interim relief, usually orders to prevent any further action being taken in reliance the decision challenged.  It may be possible to resist these orders – with the court looking at the balance of the matter and usually trying to preserve the position to enable a full hearing to proceed.

In the event that the court finds the decision-making process was not correctly followed, the court may validate the decision (generally if the only successful ground of review is a technicality),19Taylor, ibid, at 151-152. make a declaration, issue an injunction and/or quash the decision.20Section 16, Judicial Review Procedure Act 2016. The decision-maker may be ordered to remake the decision, with directions from the court. The court will not generally replace the original decision with its own decision.21Although see footnote 14 above for rare exceptions.

When remaking the decision, the decision-maker may arrive at exactly the same decision as the original, provided they comply with the procedure as prescribed by law and including any directions from the Court. In this situation, keeping a thorough record of the process followed when re-making the decision may be equally as worthwhile as in the original instance, as if the same decision is reached it may face a repeat challenge.

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