Wai ~1~.# Ai

Wai ~1~.# Ai

THE TRUSTEE

AND

THE TREES:

A REPORT ON THE LEASING OF PAPATARATA A2

A Report Commissioned by the Waitangi Tribunal for

Wai679

Katherine Orr-Nimmo

May 1999

TABLE OF CONTENTS

THE AUTHOR ACKNOWLEDGEMENTS ABBREVIATIONS

MAPS Figure 1: Papatarata A2 Block 1974 Figure 2: Papatarata A2 Block 1981 Figure 3: Papatarata A2 Block 1983 Figure 4: Papatarata A2 Block 1985

Page CHAPTER 1: Introduction

1.1: The Claimant 1 1.2: Papatarata A2 up to 1967 3 1.3: The Maori Trustee 4 1.4: The Claim 5

CHAPTER 2: Papatarata A2 1967 - 1977 2.1: The Lease to the Raroas 8 2.2: The Transfer of the Lease to

Harry Johnson 13 2.3: Hovell Ownership of Shares in

Papatarata A2 16 2.4: Conclusion 16

CHAPTER 3: Papatarata A2 1977 - 1982 3.1: The Beginning of Controversy over

Papatarata A2 18 3.2: The Escalation of Controversy over

Papatarata A2 25 3.3: The 1980 District Court Case and its

Aftermath 35 3.4: The Demand for Action against the

Lessee by Head Office 43 3.5: Conclusion 46

CHAPTER 4: Papatarata A2 1982 - 1986 4.1: The Discovery of Major Felling

on the Block 49 4.2: The 1983 District Court Case 52 4.3: Escalation in the Scale of the Case 54 4.4: The 1986 High Court Case 56 4.4.1: The Case for the Maori Trustee 4.4.1.1: The Evidence of David Eric McQueen 56 4.4.1.2: The Evidence of Robert Grubner 58 4.4.1.3: The Evidence of Graham Robert Driver 59 4.4.1.4: The Evidence of

Raymond De Berdt Hovell 59 4.4.1.5: The Evidence of Brian Courtenay Cox 60 4.4.1.6: The Evidence of Gordon Hunter Kelso 61 4.4.1.7: The Evidence of John Richard Preece 62 4.4.1.8: The Evidence of Arnold Julius Ferris 63 4.4.1.9: The Evidence of John Carlaw Hagen 64 4.4.2: The Case for the Defendant 4.4.2.1: The Evidence of

Richard Harold Twistleton 66 4.4.2.2: The Evidence of Athol Nolan Richardson 67 4.4.2.3: The Evidence of

John Francis McElhinney 68 4.4.3: Adjournment of the Case Sine Die 70 4.5: Conclusion 70

CHAPTERS: The Search for a Settlement 5.1: The Settlement of 4 August 1986 73 5.2: Initial Negotiations over Papatarata A2 74 5.3: Initial Negotiations over

the Issue of Legal Costs 76 5.4: Payment following the Settlement of

4 August 1986 80 5.5: Negotiations about Legal'Costs

1989 -1993 80 5.6: Conclusion 84

CHAPTER 6: Conclusion 85

BIBLIOGRAPHY

APPENDIX 1: Direction Commissioning Research

APPENDIX 2: Document Bank Maori Trustee, Gisborne Office File 18/130/2 vol 2

Page

R D Hovell to B Couch, Minister of Maori Affairs, 22 September 1980 A 1 B R Green, Trust Officer - R.D.Hovell- Ministerial (undated) A 4 Minister of Maori Affairs to R D Hovell, 11 February 1981 A 6 Minister of Maori Affairs to R L Bell, 19 February 1981 A 8 A J Ferris, Assistant District Officer, to District Solicitor,

9 September 1982 A 9 B F Bennett, District Solicitor, to Witters, Rishworth & Wall,

5 November 1982 All Undertaking by R D Hovell, 17 Apri11984 Al3

File 18/130/2 vol 3 T G Woods, District Solicitor, to Burnard, Bull & Co, 5 August 1986 A14 ESTATE TRUST of Papa tarat a A2 from 23.6.82 to 16.7.87 A16 J C Kinder, Regional Solicitor, to Mike West, 30 October 1992 A17

File 18/130/2 vol 4 Mike West to John Kinder, Regional Solicitor, Gisborne, 16 July 1992 A18

National Archives, Wellington AAVN W3599 54/91120 (read at Head Office of the Maori Trustee) R D Hovell to B Couch, Minister of Maori Affairs, 18 February 1981 A20 Ben Couch, Minister of Maori Affairs, to R D Hovell, 18 June 1981 A22 R Wickens to Robinson, 31 July 1987 A24 Rishworth, Wall & Mathieson to J Ferris, 11 February 1987 A29

Supplied by the Claimant (R D Hovell) Short Resume - John Car1aw Hagen & Written Brief of Evidence of

John Carlaw Hagen A32

Supplied by Counsel for the Claimant (R T Hovell) Rishworth, Wall & Mathieson to J Ferris, 16 March 1987,

followed by File Note 'HOVELL' dated 11 August 1986 A39 I J Hyslop, Regional Solicitor, to Wilson, Barber & Co, 3 March 1993 A42 Ray Hovell to I J Hyslop, 14 June 1993 A44

· Exhibit 1, The Maori Trustee v Barber, High Court, Gisborne

Memorandum of Lease, Maori Trustee and M & S Raroa Deed, Maori Trustee and Harry Johnson, 2 December 1974

A46 A53

fHEAUTHOR

Tena koutou. My name is Katherine Orr-Nimmo. I am a Pakeha of Scottish, Irish and English descent. My family lives in Wellington. I have a B.Sc.(Hons) in Economics from the University of Canterbury, completed in 1977. From the University of Oxford I have a D.Phil in Modern History and a B.A.(Hons) in Theology, both completed in 1983. I am an Anglican priest. Between 1986 and 1995, I worked in parish ministry and as an industrial chaplain. I also contributed entries to volumes one and two of The Dictionary of New Zealand Biography. Between 1995 and 1997, I worked on a report for Crown Forestry Rental Trust on the East Coast Maori Trust. From April 1997 to April 1999, I was a Research Officer at the Waitangi Tribunal. During that time I was responsible for facilitating claims for the East Coast area above Poverty Bay. I also wrote 'The Land and the Blackberry: Aspects of the History of the Hereheretau and Kahaatureia Blocks with special reference to Hereheretau Station and the Maori Soldiers' Fund' (April 1998) and' "A Matter of Bargain": Aspects of the History of Parish ofTe Puna Lots 16 and 154' (September 1998). Since then, I have been working both on this report and on a report on the Kohumaru area, related to Waitangi Tribunal claims Wai 58, Wai 295 and Wai 320.

ACKNOWLEDGEMENTS

My thanks to the following for provision of information and archives: the claimant; Counsel for the claimant; the staff of the Head Office of the Maori Trustee, particularly Isobel McIntyre; the staff of National Archives, Wellington; Godfrey Pohatu, Deputy Registrar of the Tairawhiti Maori Land Court; and the staff of the High Court, Gisbome, particularly Elaine Constable. My thanks to Justice Smellie for giving permission for me to read High Court records associated with The Maori Trustee v R A Barber (Estate of Harry Johnson). I am grateful to colleagues at the Waitangi Tribunal, Department of Courts, particularly Dr Barry Rigby, for their support and encouragement. Noel Harris has again done fine work on the mapping for this report.

ABBREVIATIONS

DB fol(s) ibid MA MB NA op cit p,pp s, ss Wai

Document Bank (see Appendix 2) folio(s) ibidem (in the same book, etc) Maori Affairs Minute Book National Archives opere citato (in the work already quoted) page(s) section( s) (of an Act) Waitangi Tribunal claim

N.H.- May 1999 (Redrawn from sketches by B. C. Cox Reg'd Surveyor 11-4-1986)

1km

1/2mile

. I

,

Cape Runaway

RIVER (TITLE 1")15)

REFERENCE: 2 Dec 1974 FENCE (BOUNDARY) --TITLE BOUNDARY

RIVER BANK

NATIVE BUSH

CLEAR

miles 20

r---~r--

\\I~ v.,alaKatuwhero River

Te Araroa

~ / ~ East Cape

~--

Ruatoria FIGURE 1 : PAPATARATA A2 BLOCK 1974

1

SHOWING AREAS CLEARED ETC & FENCES BLOCK XII MATAKOAO S.D. WAIAPU COUNTY

GRANT AND COOKE REGISTERED SURVEYORS APRIL 1986

Waipiro Bay

Tokomaru Bay

N.H.· May 1999 (Redrawn from sketches by B.C.Cox Reg'd Surveyor 11·4·1986)

1km

1/2mile

REFERENCE: June 1981 FENCE (BOUNDARY) __ _

TITLE BOUNDARY

RIVER BANK

NATIVE BUSH

CLEAR

FIGURE 2 : PAPATARATA A2 BLOCK 1981



t':':-:':':':':-I

rJ.H.- May 1999 (Redrawn from sketches by B.C.Cox Reg'd Surveyor 11-4-1986)

1km

1/2mile

AI

REFERENCE: July 1983 FENCE (BOUNDARY) --

TITLE BOUNDARY

RIVER BANK

NATIVE BUSH

CLEAR

FIGURE 3 : PAPATARATA A2 BLOCK 1983



H 1-:·:·:-:·:·:·:·1

N.H.- May 1999 (Redrawn from sketches by B.C.Cox Reg'd Surveyor 11-4-1986)

1km

1/2mile

AI

REFERENCE: Nov 1985 FENCE (BOUNDARY) --TITLE BOUNDARY

RIVER BANK

NATIVE BUSH

CLEAR

22 acres reverted scrub ~

32 acres cleared land ~

in inferior grasses

FIGURE 4: PAPATARATA A2 BLOCK 1985



CHAPTER 1: INTRODUCTION

1.1 The Claimant

This research report sets out to look at issues raised in Waitangi Tribunal claim Wai 679,

a claim relating to native trees on Papatarata A2 Block. Papatarata A2 is on the East

Coast of the North Island, near Te Araroa. 1 The block has an area of 480 acres 1 rood

(194.35028 hectares).2

This claim was received on 29 April 1997 and registered on 21 August 1997. The

claimant is R D Hovell of Gisborne, who claims on behalf of himself and 'other Maori

owners of Papatarata A2 Station, Te Araroa and of N gati Porou descent.' 3 R D Hovell is

often known as Sandy Hovell.

The shares currently owned by the claimant in Papatarata A2 were bought either by his

father, Thomas Hovell, or were subsequently bought by the claimant. Despite this, the

claimant regards this block as ancestral land. The original owners of the Papatarata block

included his great-great-grandmother, Te Here Kaipuke, or Tapita, who married Josef

Manuel. Another original owner was Tapita's sister, Te Auwhi, who also married Josef

Manuel. The son of Te Auwhi and Josef Manuel, Rapata Manuel, was also an owner.

Rapata Manuel died without issue.4

The claimant has pointed out his ancestral links with the land from time to time during

the course of the controversy over Papatarata A2. In 1983, in a letter to Peter Tapsell, the

Member of Parliament for Eastern Maori, the claimant stated that

1 See Figure 1 2 Area given in Compiled List of Owners as at 13.10.1976 Block: Papatarata A2, 18/130/2 v014, Maori Trustee, Gisbome Office. An extract from Ruatoria MB 28, f01253, 18 November 1989, gives the area of Papa tarat a A2 as 185.750 hectares, or 459 acres. Extract ... headed: 89876 S.30(i)G)/53 - Papatarata AI, fo11(e), 18/130/2 vol 4, Maori Trustee, Gisbome Office The decrease in area may have been the result of erosion, See sections 3.1,3.3 3 Wai 679 claims, claim 1.1, p 1 4 Information supplied verbally by the claimant to the writer, 23 March 1999; Sheet showing Hovell Whakapapa supplied by the claimant;

I am a descendant of Jose Manuel whose wife was the original owner of the land. She was my great-great-grandmother so this is ancestral land which I am trying to recover from the lessees, the Johnston [sic] family. 5

In a later letter to Tapsell, Hovell stated that Papatarata A2 was 'ancestral land farmed by

a relative until the lease was transferred in 1967.'6 In 1986, following many years of

pro blems over the lease of the block, there was a prolonged hearing in the High Court in

the action The Maori Trustee versus R A Barber. Barber was the executor of the estate of

Harry Johnson, the deceased lessee of Papatarata A2. During this case, Hovell was

questioned by the Court about his links with the block. He said that his father had bought

his shares from a relative:

The relationship goes a long way back. My fathers [sic] grand uncle was the original owner Was he one of a number ... One of a number but he had the majority shares That's going [back] almost far enough for us to touch on the first point of time when this land came under the Uurisdiction] of the Maori land [Court] .. Yes Did your forebears live in this area even before then .. yes.7

This was not the only land with which the claimant's whanau had ancestral associations.

R D Hovell has also made a claim, Wai 750, in connection with the Waitangirua 2 block.

Waitangirua 2 was also in the Te Araroa area. The claimant's father lost an interest in this

land in 1932. In 1958, in what was apparently an attempt at compensation for the loss of

his interest in Waitangirua 2, the claimant's father was awarded shares in Pipituangi

block. Figures 1 to 4 show that Pipituangi is a block that borders on Papatarata A2.

Pipituangi is now farmed by the Hovell whanau.8

Copy of will of Rapata Manuel supplied by the claimant; 5 Unsigned letter that appears from contents to be written by R D Hovell- to Peter Tapsell, 19 August 1983, 18/130/2 vol 2, Maori Trustee, Gisbome Office 6 Sandy Hovell to P Tapsell, 19 October 1983, AA VN W3599 54/91120, NA Wellington 7 Transcript, p 95, Box: 'A1l/85 Maori Trustee v Estate Harry Johnson Part file', High Court, Gisbome 8 Wai 750 claims, claim 1.1

2

The claimant was born in 1931 at Te Araroa.9 He became a builder. In 1977, he was one

of the regular Maori housing contractors for the Department of Maori Affairs. 1o

The claimant's expenence was not, however, confined to building. He told the High

Court in 1986 that:

I was born in Te Araroa, I was brought up on a dairy farm and milked cows thru [sic] the war years, I reg[ ularly] visited my father's home and helped him on the farm fencing, marking cattle, docking, cutting and storing hay and all gen[eral] farm work. Beside[s] this I own a 10 acre farm of my own in Gisbome and lease adjoining properties which gave me a farmlet of approx[imately] 35 acres to farm. On this I did all my own fencing and did my own farm management and ran the little farmlet at a good profit. 11

1.2 Papatarata A2 up to 1967

The original investigation of title for Papatarata and the adjoining Pipituangi block took

place in 1894.12 At that stage, the area of the original Papatarata block was given as 627

acres. 13 As a result of the investigation, Papatarata was divided into Papatarata A and

Papatarata B. 14 In 1945, both Papatarata A and Papatarata B went into receivership as a

result of charges for compensation for improvements made under a previous lease.

Initially the receiver was the Tairawhiti District Maori Land Board. What became

Papatarata A2 was leased for 21 years with a view to enforcing this charge. At some

point, however, the Maori Trustee had become responsible for administering the lease. 15

9 Transcript, p 79, Box: 'Al1185 Maori Trustee v Estate Harry Johnson Part file', High Court, Gisbome 10 District Officer, Gisbome, to Head Office, 22 November 1977, AAMK. 86911191a, NA Wellington 11 Transcript, p 86, Box: 'A11/85 Maori Trustee v Estate Harry Johnson Part file', High Court, Gisbome 12 Waiapu Native Land Court minute book 25, fo1s 199 - 227,295, 295A, 295(2), 295(3) & [mal fo1 also numbered 295. Ibid, fo1s 227 - 228,350,356 - 357 (Pipituangi) 13 Ibid, fo1 199 14 Ibid, fo1295 15 On receivership, see Waiapu MB 113, fo1s 172 - 173 (18 October 1945), fo1289 (6 June 1946 - owners refused to allow renewal of the lease to the previous lessee, to whom they owed £606 compensation for Papatarata A, so receivership had to proceed). Extract of Minutes from Ruatoria Minute Book Volume 14, folios 376-380 (3 October 1977) Rather confusingly, this states that the Maori Trustee was made the receiver in 1945, and that he leased the land to enforce the charge for compensation. fo1315, AAMK 86911191a, NA Wellington

3

Papatarata A2, along with Papatarata AI, was created by a Vesting Order on

Consolidation. This was made on 22 March 1957 as part of the seventh and final part of

the Northern Waiapu Consolidation Scheme.16

In 1970, a lease inspection report described Papatarata A2 as lying 2 miles up the

Karakatuwhero Valley Road, and then across the river. The report described 320 acres of

the block as flat and 150 acres as rolling to low hill country.17 This inspection report saw

the block as an attractive piece of land, although one that had suffered from several

decades of neglect. 18

1.3 The Maori Trustee

During the late 1970s and early 1980s, which are crucial years for this claim, the

Papatarata A2 block was leased. The Maori Trustee was the agent responsible for the

administration of this lease. Some brief background on the Maori Trustee is consequently

included here.

The office of the Native Trustee was created under the Native Trustee Act 1920. The act

'constituted the Native Trustee as a corporation sole with perpetual succession and a seal

of office.'19 Initially there was a Native Trust Office associated with the Native Trustee.2o

In 1932, however, the Native Trust Office and the Native Department were formally

amalgamated under section 15 of the Native Land Amendment Act 1932. The offices of

Under Secretary of Native Affairs and Native Trustee were to be held by the same

person.21

16 Extract from Ruatoria Minute Book 28, headed: 89876 S.30(i)G)/53 - Papatarata AI, fol 1 (d) in 18/130/2 vol 4, Maori Trustee, Gisbome Office 17 Again, the balance of the area may be accounted for by erosion into the river. See section 3.2 18 Property Inspection report, fo132, 18/130/2 vol 1, Maori Trustee, Gisbome Office (for date, see fo1357, AAMK 869 1191a, NA Wellington) 19 G V Butterworth & S M Butterworth, The Maori Trustee (The Maori Trustee. No date or place of publication given, but introduction dated May 1991), p 28 20 Ibid, P 29 21 Ibid, P 35

4

This relationship between the Native Trustee, subsequently the Maori Trustee, and the

Native Department, subsequently the Department of Maori Affairs, continued until the

Department of Maori Affairs ceased to exist on 31 October 1989.22 Consequently, during

the late 1970s and for most of the subsequent decade, including the important 1986 High

Court case relating to Papatarata A2, the claimant was dealing with staff who were not

simply Maori Trustee staff, but also staff of the Department of Maori Affairs. The

Ministers of the Crown from whom he primarily sought assistance were two Ministers of

Maori Affairs, Duncan MacIntyre and Ben Couch.

Much of the information on which this report is based has been supplied by the Head

Office and the Gisborne Office of the Maori Trustee. Isobel McIntyre for the Maori

Trustee writes:

I confirm our discussion regarding the files made available for your research, ie; from the five files the Maori Trustee has declined to make available five letters. As these are between the Maori Trustee and his legal advisors they are considered to be privileged.23

1.4 The Claim

Central to this claim is the claimant's statement that he and the other owners have been

... prejudiced by the crown through the negligence of Ministers of Maori Affairs and other government ministers by their failure in not acting on our behalf at the appropriate time to protect eighty acres of our standing native trees being unlawfully cut down and burnt by a lessee with a Maori Trust lease?4

The claimant seeks financial compensation for the loss of the native trees. He also seeks

compensation for the time and money he spent over a ten year period in proving the

validity of his grievance.

22 Ibid, P 156 23 Isobel McIntyre for Maori Trustee to Registrar, Waitangi Tribunal, Attention Kathy Orr-Nimmo, 18 March 1999, File Wai 679/0, Waitangi Tribunal, Wellington 24 Wai 679 claims, claim 1.l, p 1

5

Chapter 2 of this report looks at the way in which Papatarata A2 was leased to M and S

Raroa in 1967. The Maori Trustee acted as agent for the owners for this lease, but he had

been given no opportunity to express an opinion as to the choice of the lessees. The

chapter touches on problems with rent and beaches of covenant with these lessees. It then

looks at the transfer of the lease to Harry Johnson in 1974. Lastly, the chapter refers to

the purchase of shares in the block by Thomas Hovell, the father of the claimant. After

his father's death in 1973, the claimant began to take an interest in the state of Papa tarat a

A2.

Chapter 3 looks at the efforts of Hovell, beginning in 1977, to purchase more shares in

the block, and to get the Maori Trustee to take action against the lessee for breaches of

covenant. This chapter also traces Hovell's efforts to gain support from Ministers of the

Crown, particularly two Ministers of Maori Mfairs.

The chapter touches on a technical problem with a 1979 legal action against the lessee. It

then reviews the increasingly acrimonious situation relating to the block that developed

when an 1980 District Court action against the lessee collapsed over the discrepancy in

evidence between a Maori Affairs employee and an expert witness paid by Hovell. From

September 1981, the Gisborne Office of the Maori Trustee had instructions from Head

Office to take legal action against the lessee, but Gisborne officials were slow to act on

these.

Chapter 4 indicates that, in the latter stages of the resistance of the Gisborne Office to

respond to instructions from Head Office, substantial numbers of native trees were

destroyed on the block. The chapter touches on another technicality that caused problems

with a 1983 District Court action against the lessee. Most of the chapter, however,

concerns evidence in the 1986 High Court action between the Maori Trustee and the

estate of the now deceased lessee, Harry Johnson.

6

Chapter 5 touches on the settlement arrived at on 4 August 1986, the day that the High

Court action was adjourned. Most of the chapter deals with the efforts of Hovell to

achieve some compensation for the very high legal costs that he had incurred in

connection with legal actions over the block.

The Maori Trustee faced some significant problems in administering leases such as the

one arranged for Papatarata A2 in 1967. Nevertheless, this report will argue that there

were repeated inadequacies in various aspects of the administration of this lease by the

Maori Trustee. More effective action by staff of the Maori Trustee, together with more

questioning of departmental actions, particularly by Ben Couch in his capacity as

Minister of Maori Affairs, might well have prevented the destruction of native trees on

the block in 1982.

7

CHAPTER 2: PAPATARATAA21967-1977

This chapter looks first at the lease of Papatarata A2 in 1967. The Maori Trustee acted as

agent for the owners for this lease. It then looks at the transfer of this lease to Harry

Johnson in 1974. At this point, there had been substantial breaches of covenant by the

1967 lessees.

Lastly, it touches on the acquisition of shares in the block by Thomas Hoven in 1972, and

initial inspections of the block by his sons, R D Hoven and R G Hovell. It was as a result

of these inspections that R D Hoven, the claimant, first became aware of the neglected

state of Papa tarat a A2.

2.1 The Lease to the Raroas

In 1967, the lease of Papatarata A2 to Tame Waikare expired. There were two

applications to lease the block. Apparently the state of the block while it was leased by

Waikare was less than completely satisfactory.25

On 9 December 1966, a meeting of assembled owners of the block passed the following

resolution:

That the above block be leased to Miria Raroa and Stone or Uepohatu Raroa for a term of 21 years from termination of present lease to Tame Matekairoa Waikari at a rental equal to 6% of Special Government Valuation with a right of renewal of 21 years. No compensation for improvements.

Rent at the end of first 10 years to be revised to 6% of Capital Value (less lessee's improvements) as in Special Government Valuation to be obtained in 1976. In case of renewal rent to be 6% of Capital Value (but not to exclude lessees improvements) as in Special Government Valuation to be obtained in 1987, but not to be less than that for the last 11 years of the original term. At the end of 10 years, rent to be revised as in the case

25 District Officer, Gisbome to Head Office, 9 June 1978, AAMK 86911191a, NA Wellington

8

of the original term. The Maori Trustee to be authorised under Section 315(E) to act on behalf of the Owners?6

On 25 January 1967, Judge Haughey confirmed the resolution, with the lease to the

Raroas, a mother and son, to run from 1 December 1967. Miria Raroa was an owner in

the block??

Subsection (1) of section 315 of the Maori Affairs Act 1953 laid down that the assembled

owners of land could pass a number of resolutions. These included:

(e) That the Maori Trustee be authorized to act as the agent of the owners to negotiate for and to carry into effect the alienation, by sale or lease or otherwise as may be specified in the resolution, of the land or of any part thereof, subject to such restrictions or limitations as may be specified in the resolution, or that the Maori Trustee be appointed the agent of the owners for any other specified purpose; or that any resolution theretofore made for the purposes of this paragraph be revoked:

Section 315 was included in Part 23 of the act. Butterworth and Butterworth, in their

history of The Maori Trustee, discuss the 1978 Mete-Kingi Report. This was a report by a

committee appointed to investigate problems associated with farming Maori Leasehold

Land?8 They discuss the various categories of Maori lease, including those made under

Part 23 of the Maori Affairs Act 1953. Leases granted under that part of the act were

made as a result of meetings of assembled owners. Where the land had more than ten

owners, such meetings were called, and had their resolutions confirmed, by the Maori

Land Court.

Such leases were mainly concentrated on the East Coast to the north of Gisborne, and in

the North Auckland area. Butterworth and Butterworth comment that the Mete-Kingi

Committee regarded such leases as 'highly unsatisfactory and ... contributing to much of

the land being poorly farmed, eroded and reverting to scrub.' The committee found that

26 Order Confmning Resolution of Assembled Owners, Maori Land Court, Rua M.B. 8/384, 18/130/2 vol 4, Maori Trustee, Gisborne Office 27 Extract of Minutes from Ruatoria Minute Book Volume 8, folio 384, 18/130/2 vol 1, Maori Trustee, Gisborne Office

9

the principal preoccupation of owners in these two areas was the retention of land in

Maori occupation. The preference was to lease it to family members, whether or not such

lessee had the skills to farm the land. 29

A minute on the Maori Trustee's file indicated that the trustee had formally consented to

the agency to act under section 315(1)(e) of the Maori Affairs Act 1953 to give effect to

the lease to the Raroas. It also noted that nothing was known 'about the farming ability or

financial resources of these persons', but observed that the Maori Land Court had already

confirmed the resolution.30 The Maori Trustee had to accept the lessees who had been

chosen.

The trustee was left simply to finalize the details of the lease. Rather than obtain a Special

Government Valuation, the new lessee was offered the option of using the 1966

Government Valuation as a basis for setting the rent. The 1966 valuation was $4,200.

This gave a rental for the initial ten year period of $252, plus the Maori Trustee's six per

cent commission.3!

This proposal was accepted. The Maori Trustee then proposed that the improvements in

the 1966 valuation should also be taken as those existing at the beginning of the lease.

These were:

Buildings - old whare & cowshed Fencing - 13 0 chains Clearing & Grassing - 90 acres

28 G V Butterworth & S M Butterworth, op cit, p 101 29 Ibid, pp 110 - 111

$100 350 820

$127032

30 Minute to District Officer on Harvey for Registrar to Chrisp & Chrisp, 22 February 1967, 181130/2 vol 1 31 McEwen for District Officer to Chrisp & Chrisp, 8 September 1967, 181130/2 vol 1 32 B Wolstenholme for District Officer to Chrisp & Chrisp, 23 November 1967, 181130/2 vol 1

10

Chrisp & Chrisp, solicitors for the Raroas, responded that his clients 'are prepared to

accept the situation as set out in your letter.' On the other hand:

they desire to place on record that the buildings are uninsurable, the cow shed is practically non-existent and the whare has no [roof] and is to all intents and purposes useless. The fencing is also in a hopeless state of disrepair. 33

In December 1967, the Raroas signed a lease for Papatarata A2.34 The rent for the next

eleven years was to be determined as set out in the resolution of the meeting of assembled

owners already quoted.35

The lessee agreed, among other things:

• to pay the rent in equal half yearly instalments in advance, together with a six per cent

commission for the Maori Trustee;36

• to pay all rates and taxes;37

• not to sublet without the written consent of the Maori Trustee;38

• to fence, within two years of the beginning of the lease, the boundaries of the land

upon which no substantial fence existed;39

• to repair and maintain all improvements;40

• to lay down the land, within five years of the beginning of the lease, in good English

grasses, and to manage the land so that at the end of the lease, it would all be left in

'good permanent English grasses and clovers' ;41

• to use modem methods to eradicate all noxious weeds;42

33 Chrisp & Chrisp to District Officer, Department of Maori Affairs, 21 December 1967,18113012 vol 1 34Copy of Memorandum of Lease (DB), in Exhibit 1 (Judge) in material with brown paper note: 'Copy of Exhibits held in Strong Room .. .' [Maori Trustee v Estate Harry Johnson], High Court, Gisbome. Date on last page of lease (p 6 of Exhibit 1) seems to be 20 December 1967, but date is given as 26 December in Index to Documents at front of Exhibit 1. 35 Rent: p 2 of Memorandum of Lease (DB), and Resolution as quoted earlier in this section 36 same Memorandum of Lease, section 1 DB 37 same Memorandum of Lease, section 2 DB 38 same Memorandum of Lease, section 3 DB 39 same Memorandum of Lease, section 4 DB 40 same Memorandum of Lease, section 5 DB 41 same Memorandum of Lease, section 7 DB 42 same Memorandum of Lease, section 8 DB

11

• to keep all ditches, drains and watercourses on the land unobstructed;43

• to topdress land laid down in pasture annually;

• to

'keep any native bush or shrubbery shelter ornamental or other trees at any time growing upon the said land in good order and condition and ... not without the written consent of the Maori Trustee cut down damage or destroy or permit to be cut down damaged or destroyed any of the said native bush shrubbery shelter ornamental or other trees at any time growing on the said land and ... use all proper and reasonable means to preserve the same and ... not remove or permit to be removed from the said land any fencing posts timber or fIrewood Provided however that the Lesee may use for their own requirements on the said land for repairing fences and for fIrewood any logs or dead timber on the said land. ,44

The Maori Trustee, on the other hand, agreed that the lease should be renewable under the

terms set out in the resolution from the meeting of owners.45 It was also agreed that the

Maori Trustee could view the condition of the land and buildings 'at all reasonable

times' .46 The Maori Trustee reserved the right to mill timber and flax and to extract

various metals and minerals from the block.47

Meanwhile, staff at the Department of Maori Affairs were aware that dairying was now

rare on the East Coast and that the cow shed was unlikely to be used. They were also

aware of 'old whares scattered like confetti all over the East Coast'. Given the very low

valuation of these buildings, it seemed that the solicitor's letter would be accurate.

P J Brewster, the District OffIcer of the Department of Maori Affairs, told Chrisp &

Chrisp:

There is no doubt in the Maori Trustee's mind as to the meaning of Clause 5 of the lease signed by your clients. However, he does not wish to be umeasonable in this specifIc instance, and he is prepared to agree that at the commencement of the lease that the whare and the cowshed were, to all intents and purposes non-existent.

43 same Memorandum of Lease, section 9 DB 44 same Memorandum of Lease, section 18 DB 45 same Memorandum of Lease, section 24 DB 46 same Memorandum of Lease, section 25 DB 47 same Memorandum of Lease, section 26 DB

12

The position, however, as regards fences is in a different category. Clauses 4 and 5 of the lease are definite in their wording and the Maori Trustee can only assume that your clients were aware of the state of the fences when seeking the lease. At no time either at Meeting of Owners on 9.12.66 or on confirmation by the Court on 21.5.67 or when executing the lease did they make any complaint as to fences. The Maori Trustee has no option but to require the said two Clauses to be complied with and especially Clause 4 as to erection of boundary fences within two years of commencement of the lease. In any event the erection of sufficient stock-proof fences IS

considered an essential towards profitable farming operations.48

The lessees should therefore have been left in no doubt about their obligation to provide

adequate boundary fencing for Papatarata A2.

2.2 The Transfer of the Lease to Harry Johnson

The Raroas were to prove unsatisfactory lessees. By late 1969, they were behind with the

payment of rent. This proved a continuing problem.49 In December 1969, the Maori

Trustee first became aware that Harry Johnson was interested in acquiring the lease of

Papatarata A2.50 Johnson was later described as a Ruatoria Maori, who was one of the

'more substantial' farmers in the area. He had a freehold property and numerous

leasehold interests. 51

Johnson paid for an inspection report on the block. This revealed that the present lessee

has failed to clear 250 acres of scrub and grass and to fence 345 chains of boundary

fencing. 52 The inspector put the cost of remedying breaches of covenant at $26,900.53

48 P J Brewster, District Officer, to Chrisp & Chrisp, 1 February 1968, with Minute by Admin. Officer, fo1 21 in 181130/2 vol 1, Maori Trustee, Gisbome Office 49 District Officer to Miria & Stone Raroa, 22 October 1969; see also same to same, 25 February 1970; P J Brewster to M & S Raroa, 19 August 1970; J H Dark for Maori Trustee to M & S Raroa, 14 September 1970; J H Dark for Maori Trustee to Nolan & Skeet, 3 June 1971. All in 181130/2 vol 1 50 Wilson, Cull & Barber to Maori Trustee, 11 December 1969, 18/130/2 vo11 51 District Officer, Gisbome, to Head Office, 22 November 1977, AAMK 86911191a, NA Wellington 52 F E Quayle for District Officer to Wilson, Cull & Barber, 19 December 1969; Wilson, Cull & Barber to District Officer; J H Dark for Maori Trustee to Wilson, Cull & Barber, 29 May 1970, all in 18/130/2 vol 1

13

In view of the pessimistic view of the block that emerged during the later High Court

case,54 the concluding remarks of the inspector who looked at the block are interesting:

This is quite an attractive peice [sic] of land that has been neglected and mismanaged for 35 yrs (1935) with the reversion accelarating [sic] since 1946 during the occupation of Tommy Waikare according to Mr Nathan Raroa The re-development is going to be costly but could be done quite rapidly owing to the large area of flat and low conformation of the hill portion When in grass it will make a nice unit, lying between the 2 rows of hills is very warm sheltered land. The only drawback is the access across the river, which could become impassable to stock and vechiles [sic] for short periods. Inspection was done from the road as the river was swollen from the recent rain and unfordable Any future leases should have minimum yearly amounts of grassing & fencing quite clearly stated and the lessee advised that the conditions will be rigidly adhered to.55

This section of the report also revealed that Harry Johnson had been grazing Papatarata

A2 for the previous three years. 56 After being informed about the expectations of the

Maori Trustee in the event of his talting over the lease, Johnson decided not to continue

with the transfer. 57

In 1973, however, Johnson again expressed interest in the lease. 58 Shortly after that,

H P Martin, Assistant District Officer, expressed to Natana Raroa the concern of the

Maori Trustee about various leases which Raroa held. The Maori Trustee had learnt that

Raroa had been discussing with various people sub-letting several leases at a figure

considerably higher than the rent that he was paying the Maori owners. Despite this, in

several cases, blocks Raroa was leasing were not being farmed in accordance with the

covenants in the respective leases. Martin warned that the Maori Trustee was 'anxious'

53 Calculated from Property Inspection Report [Date of Inspection apparently not filled in], section 11., fol following fo132, 181130/2 vall, Maori Trustee, Gisborne Office 54 For example, see section 4.4.1.6 55 Property Inspection Report [Date ofInspection apparently not filled in], section 12., 18/130/2 vall 56 Ibid 57 J H Dark for Maori Trustee to Wilson, Cull & Barber, 29 May 1970; 181130/2 vall

58 Wilson, Barber & Co. to Maori Trustee, 13 March 1973, 181130/2 vall

14

about this situation. He indicated that all Raroa's leasehold areas were consequently to be

inspected very shortly.59

A further inspection of Papatarata A2 had apparently been due in December 1972.60 It

was made in May 1973. This inspector gave the breaches of covenant as failure to erect

345 chains of boundary fence and failure to clear, grass and topdress 400 acres. Because

different prices were used, the inspector put the cost of remedying these breaches at

$27,825.61

On this occasion, the inspector looked over part of the property, but inspected some from

the road. The inspector estimated that at this stage there were 50 acres of good pasture, 30

acres of 'niggerheads', and 20 acres of young manuka regrowth. The inspector estimated

that the balance of the block was' covered by a dense cover of manuka and some bush' .62

Given the neglected state of the property, the Maori Trustee set new covenants before

allowing the transfer. On 2 December 1974, Harry Johnson and the Maori Trustee signed

a deed consenting to the transfer of the lease from the Raroas to Johnson. Under this,

Johnson agreed to

• fence Papatarata A2 at the rate of 23 chains each year until the boundary was

adequately fenced;

• clear grass and topdress, at the rate of 2 cwt per acre, 26 acres of the property each

year.63

59 H P Martin, Asst District Officer, to Natana Raroa, 30 April 1973, 181130/2 vol 1 Natana Raroa was the father of Stone Raroa, one of the lessees. See Note for File on bottom of J H Dark for Maori Trustee to M & S Raroa, 14 September 1970, l8/l30/2 vol 1 60 Minute dated 14 March 1973 on Wilson, Barber & Co. to Maori Trustee, l3 March 1973, l8/l30/2 vol 1 61 Inspection Report: Leasehold Property, section [3], 1 May 1973, Inspector S T von Pein [sp?], 181130/2 vol 1 62 Inspection Report: Leasehold Property, section 6 63 Deed Consenting to Transfer of Lease dated 2 December 1974, section 2, Exhibit 1 (Judge) in material with brown paper note: 'Copy of Exhibits held in Strong Room ... ' [Maori Trustee v Estate Harry Johnson], High Court, Gisbome. DB

15

Almost immediately, Dalgety New Zealand Limited took an umegistered mortgage over

the lease of the block.64

2.3 Hovell Ownership of Shares in Papatarata A2

In 1972, Thomas Speakman Hovell bought 273.924 shares III Papatarata A2 for

$713.34.65 After his death, these shares were transferred to R D Hovell, the claimant in

Wai 679, and R G Hovell. 66

At the 1986 High Court hearing, Hovell said that his father died in December 1973. He at

once became aware that he and his brother had inherited the Papatarata A2 shares, but

probate was not granted until 1976.67 In late January 1974, however, he and his brother

went to inspect the block. They inspected it again later in 1974.68 After that, Hovell either

went onto or looked at the block every year up to 1977. He noted that until 1977, the

lessee did no clearing on Papatarata A2. The lessee was simply using the block for cattle

grazing, as he had been since the Raroas original lease of the property.69

2.4 Conclusion

When Papatarata A2 was leased to two member of the Raroa whanau in December 1967,

the land already seems to have been in an unsatisfactory state. Both buildings and fences

on the property had been neglected. The new lessees were chosen by a meeting of

assembled owners held in December 1966, and subsequently approved by the Maori Land

Court. The Maori Trustee was authorized to act as agent for the owners.

The Maori Trustee found the Raroas to be less than satisfactory lessees. They repeatedly

failed to pay rent on time, and failed to observe various covenants in the lease. The

64 Nolan & Skeet to Maori Trustee, 21 March 1975, 18/130/2 vol 1, Maori Trustee, Gisbome Office 65 District Officer, Gisbome to Head Office, 22 November 1977, AAMK 869/1191a, NA Wellington 66 The claimant, R D (Sandy) Hovell, will be referred to simply as Hovell for the remainder of this report. Extract of Minutes from Ruatoria Minute Book Volume 14 - Folios 376-380. Information relating to purchase and inheritance is on fo1315 of AAMK 869/1191a, NA Wellington 67 High Court Transcript [hereafter referred to as 'Transcript'], p 90 68 Transcript, p 80

16

property was, however, being used by Harry Johnson, a Ruatoria Maori farmer. It was his

initial 1969 inquiry about a transfer of the lease that first revealed the problem over the

lease convenants. Johnson took over the lease in 1974 knowing that extensive fencing,

clearing, grassing and topdressing was required. Johnson agreed to special covenants that

were designed to get the property into a more satisfactory condition. Up to 1977,

however, Johnson seems to have done little or nothing about these requirements.

The Maori Trustee had no opportunity to be involved in the selection of the lessees who

took over the block in 1967. But inspections of the block during the time the Raroas were

lessees seem to have been prompted rather more by the possible interest of Harry Johnson

in formally acquiring the lease than by the concern of the Maori Trustee to get the

covenants in the lease enforced. The owners of the block were not consulted about the

transfer to Harry Johnson, who was not an owner in the block.

Although the Maori Trustee lmew that Papatarata A2 was neglected, there seems to have

been no further inspection until 1977. R D Hovell had inherited shares in Papatarata A2

from his father in 1973, but probate was not granted until 1976. It was in 1977 that the

concern of Hovell about the state of Papatarata A2 became increasingly obvious to staff

at the Gisborne Office of the Maori Trustee.

69 Transcript, p 82

17

CHAPTER 3: PAPATARATAA2 1977 -1982

The first section of this chapter looks at the 1977 inspection report on Papatarata A2 and

at the issue of a section 118 property notice. The section describes Hovell' s initial

attempts to purchase more shares in the block, which he hoped to farm himself. It touches

on Hovell's early expressions of concern about the block and the lease in the Maori Land

Court, to staff of the Maori Trustee and to the Minister of Maori Affairs.

The next section looks at Hovell's continuing efforts to get action taken about the lessee

and to buy up more shares. Hovell became increasingly critical of the Maori Trustee,

given the very slow progress of development by the lessee coupled with the long

association of the Maori Trustee with the block. The section concludes by referring to the

collapse of a case against the lessee in the Magistrate's Court in October 1979 because of

a technicality.

The next section deals with the collapse of the 1980 District Court case brought by the

Maori Trustee against the lessee, as a result of the evidence given local Maori Affairs

staff. The section goes on to look at the controversy that ensued over the discrepancy in

evidence between the Ruatoria lease inspector and an independent surveyor employed by

Hovell to give evidence in the case.

The last section refers to the continuing failure of some staff in Gisborne to take effective

action against the lessee, despite firm instructions from Head Office about the matter.

3.1 The Beginning of Controversy over Papatarata A2

The block was due for inspection in February 1977. Once again the inspection did not

occur on the due date.70

70 G A Wilson for District Officer to Field Supervisor, Ruatoria, 16 June 1977, 18/130/2 vol 1, Maori Trustee, Gisbome Office; For previous example of late lease inspection, see section 2.2

18

It was in 1977 that controversy over the block began to surface. This was also the year in

which Hovell's interest in the block became very obvious. Hovell was presumably the

owner whose concern led to an inspection of the block by J McCreadie. 71 On 21 June

1977, the inspector reported that no improvements had taken place since the last

inspection of the block. The lessee had breached his special covenants by failing to fence

460 metres a year for two years and by failing to clear, grass and topdress 10.5 hectares a

year for two years. He put the total cost of these breaches at $5685. He also noted the

total cost of breaches of the normal covenants in the lease as $41,800. He observed,

however, that in the case of the present lessee, the special covenants might over-ride the

normalones.72

Rather confusingly, in view of the statement of the inspector that improvements since the

last inspection were 'NIL', a member of the Gisborne staff, on comparing the 1977 report

with the 1973 report, concluded that the lessee had actually done 50 chains of fencing.

She still considered, however, that he had done no clearing, grassing or topdressing. She

recommended that they obtain Head Office approval to have the lease forfeited. 73

On 4 November 1977, Hovell, in an initial letter to D McIntyre, the Minister of Maori

Affairs, stated that upon inheriting shares in the block, he had decided to sell his shares.

He then found 'no one willing to buy, but everyone willing to sell so proceeded to buy.'74

On 21 July 1977, Judge Russell heard five applications by Hovell for purchases of shares

in Papatarata A2. A rent review was due for the block in December 1977.75 Consequently

Judge Russell stood down the applications to be referred to him when a Special

71 For concern of an owner prompting the inspection, see G A Wilson for District Officer to Field Supervisor, Ruatoria, 15 June 1977, 18/130/2 vol 1, Maori Trustee, Gisborne Office 72 Inspection Report: Leasehold Property, 21 June 1977, 18/130/2 vol 1 73 Minute Sheet, Joy Evans 27 June 1977, fo187, 18/130/2 vol. 1 74 R D Hovell to McIntyre, Minister of Maori Affairs, 4 November 1977, fo1316, AAMK 869/1191a, NA Wellington 75 See section 2.1 for review of rent after ten years.

19

Government Valuation had been completed.76 The minutes also record that Hovell told

the Court:

Believe breaches of [ covenants] by lessee. Hope to purchase more interests.77

On 3 October 1977, in the light of a special valuation made as at 28 July 1977, Judge

Russell considered Hovell's application to buy the shares of three of these five owners

under section 213 of the Maori Affairs Act 1953.

This special valuation gave the land value as $32,200 and the value of the improvements

as $800 (,fencing only 600m'). The Capital Value was therefore $33,000. The minutes of

the Maori Land Court note that the Government Valuer had reported that

... of the total area of 194.3 ha, 100 ha has been eroded by the river or is in silt/shingle flat of little value, 24 ha is silt flat in poor pasture, 8 ha is in poor pasture and young manuka and the rest has apparently reverted to manuka & rushes. The land has been neglected for many years ...

The opinion of Judge Russell on the likely fate of the lease is interesting in view of the

position later taken by the Gisborne Office of the Maori Trustee. The judge observed that

the lessee had failed to do anything about the deed of covenant into which he had entered

with the Maori Trustee. He stated that

The likely outcome of the present proceedings would appear to be that Mr Johnson will lose his lease and that the Maori Trustee will get a judgement against him for damages for breach of covenant. The measure of damages will be the reduction in value of the land as a result of the breaches, not the cost of remedying the breaches.

Whether the owners will in fact get anything will depend upon whether or not Mr Johnson has any assets. His failure to carry out any fencing or grassing suggests poverty rather than affluence.78

76 Ruatoria MB 14, fo1s 226 - 227 77 Ibid, fo1226 7B This and preceding quotation both from Extract of Minutes from Ruatoria Minute Book Volume 14-Folios 376-380, AAMK 86911191a, NA Wellington

20

It was presumably because there was a possibility that owners might obtain some

compensation from Johnson that the judge approved Hovell's purchase applications only

subj ect to his willingness to pay 25% above the special valuation of the block. If he was

unwilling to buy at this price, the judge said that the applications would have to wait for

the outcome of the Maori Trustee's claim against the lessee.79

The District Officer of the Department of Maori Mfairs, Gisborne, subsequently told the

Minister that the claimant had seen him 'on numerous earlier occasions about the land

and the breaches of covenant', as well as twice after this decision by the court. 80

The comments of Judge Russell were no doubt influenced by the fact that on 30 August

1977, the Maori Trustee had served a notice on the lessee under section 118 of the

Property Law Act 1952. Section 118(1) stated that

A right of re-entry or forfeiture under any proviso or stipulation in a lease, for a breach of any covenant, condition, or agreement in the lease, shall not be enforceable by action or otherwise unless and until the lessor serves on the lessee a notice specifying the particular breach complained of, and, if the breach is capable ofremedy, requiring the lessee to remedy the breach, and in any case requiring the lessee to make compensation in money for the breach, and the lessee fails within a reasonable time thereafter to remedy the breach, if it is capable of remedy, and to make reasonable compensation therefor in money to the satisfaction of the lessor.

The section 118 notice stated that the lessee had failed to fence at the rate of not less than

23 chains a year specified in the lease as modified by the Deed of Covenant. It also stated

that the lessee had failed to clear, grass and topdress the land at the rate of not less than

26 acres a year specified in the lease as modified by the Deed of Covenant.

The Maori Trustee consequently required the lessee to erect 69 chains of boundary fence

within six months of the date of the notice, and thereafter to continue to fence at the rate

laid down in the Deed of Covenant. He also required the lessee to clear, grass and

79 Extract of Minutes from Ruatoria Minute Book Volume 14 - Folios 376-380, AAMK 869/1191a, NA Wellington

21

topdress not less than 26 acres a year, as laid down in the Deed of Covenant, and

concurrently to clear, grass and topdress a further area of 52 acres within two years.

The notice stated that if the breaches were not remedied within the periods specified to

the satisfaction of the Maori Trustee, then the Trustee would take steps to enforce his

rights ofre-entry or forfeiture of the lease. 81

It was after the second Court hearing at which Judge Russell required Hovell to pay 25

per cent above the special valuation if he wished to purchase shares at that time that

Hovell first wrote to the Minister of Maori Affairs. After giving the Minister some

background, he went on to say that

although the minutes show Mr Johnson to be almost certain to lose the lease because of breaches of covenants, before committing myself to this large outlay of money I would like some assurance that I would be able to take the lease over from Mr Johnson, who is not a shareholder.

I would respectfully ask, Sir, for your direction in the matter of how I could do this and be compensated by Mr Johnson for the amounts eligible to be claimed for, for neglect of the terms of the lease.82

Following Hovell's letter to the Minister, the District Officer, Gisborne, reported that the

claimant had discussed with him the possibility of acquiring Johnson's lease, or taking a

transfer of the lease of the land. The District Officer said that he had told the claimant that

he must approach the lessee about a possible transfer. He reported that the claimant had

been aware that a notice had been served on the lessee and that if the lessee failed to take

positive steps, the Maori Trustee would take legal action towards determining the lease.

The District Officer had pointed out that this 'could be a long process' and that, should

80 District Officer, Gisbome to Head Office, 22 November 1977, AAMK 86911191a, NA Wellington 81 Section 118 Property Law Notice dated 30 August 1977, folios 13-14 in Exhibit 1 (Judge), from bunch of material with brown paper note: 'copy of Exhibits held in Strong Room ... 16.8.91', Maori Trustee v Ronald Andrew Barber as Executor of Estate of Harry Johnson, High Court, Gisbome. (Index to Documents dates the notice to 3 August 1977) 82 R D Hovell to McIntyre, Minister of Maori Affairs, 4 November 1977, fo1316, AAMK 86911191a, NA Wellington

22

the lessee move at once to comply with the covenants in the lease, the Maori Trustee

would not be able to disturb him.

Under the terms of the lease, the rental of the land was to be adjusted from 1 December

1977 on the basis of the new valuation. The effect of this would be to raise the rent from

$252 per annum to $1980 per annum, plus a 6 per cent commission to the Maori Trustee.

After his conversation with Hovell, the District Officer heard from the lessee that the

latter intended to continue with the lease at the new higher rental, and that he was starting

a work programme on the block. The lessee's solicitor advised that Johnson was in a

position to remedy all breaches of the lease.

In view of this, the Maori Trustee intended to re-inspect the property in three months'

time and to review the position regularly after that.

If the progress is satisfactory there is no point in pursuing the lessee further, and little or no chance of success if we did so. Accordingly it seems likely that Mr Johnson will continue as lessee indefinitely. Although the country is difficult and it is virtually impossible to comply to the letter with all lease covenants, Mr Johnson is in the best position to use it because it suits his adjoining or nearby land, and because he is a farmer and can obtain finance .... 83

Following this advice, James Bolger, on behalf of the Minister of Maori Affairs, wrote to

the claimant in line with the advice from the District Officer in Gisborne. He stated that

Provided that Mr Jolmson carries out a satisfactory development programme on the leased land and meets other terms of the lease, his tenure is secure and you could take over only as a result of direct negotiations with him. 84

83 District Officer to Head Office, 22 November 1977, AAMK 869/1191a, NA Wellington 84 J.B. for Minister of Maori Affairs to Hovell, 6 December 1977, AAMK 86911191a Letter attributed to Bolger in Secretary of Maori Affairs to Minister of Maori Affairs, 26 April 1978, AAMK 86911191a In 1977, Bolger was Minister of Fisheries and Associate Minister of Agriculture. New Zealand Official Yearbook 1977 (Wellington: Department of Statistics, 1977), p 859

23

Section 2.1 pointed out that, only very shortly after this time, the Mete-Kingi Report

indicated that there were problems on the East Coast with the sort of leasing arrangement

that existed on Papatarata A2. One of the problems was the tendency of owners to lease to

one of themselves. This had happened with the Raroas with unsatisfactory results. The

Maori Trustee had been given no opportunity to have any input into this leasing decision.

Furthermore, Butterworth and Butterworth also comment that the courts did 'traditionally

favour a lessee over an absentee owner'. It is consequently perhaps not surprising that

officers of the Maori Trustee within the Department of Maori Affairs in Gisborne were

not altogether enthusiastic about trying to dislodge an existing lessee in the interests of

somebody who had not been an owner when the block was let ten years earlier.

At the same time, however, the concerns of Hovell are also understandable. From his

point of view, this was ancestral land. It was land that the Maori Trustee had had some

involvement with for some decades. Certainly since 1967, there had been clear covenants

in the lease under which the Maori Trustee was the agent for the owners. It was difficult

for Hovell to see what, prior to the section 118 notice, had been done by the Maori

Trustee to enforce the covenants. Up to 1977, any work done on the block had been, at

best, minimal in the extreme. Judge Russell's comments in the Maori Land Court in

October 1977 had encouraged Hovell to hope that the lease to Johnson would shortly be

terminated. The fact that Johnson had used the block prior to formally leasing it further

increased Hovell's unhappiness over the situation.

Furthermore, Hovell made it clear to McIntryre that he knew that the lease had been

transferred from the Raroas to Harry Johnson, despite the fact that Johnson was not an

owner in the block. He remained unhappy that it was possible for the lease to be

transferred without the matter being referred back to the owners.85 There was nothing that

the officials acting for the Maori Trustee could do about legal provisions in this regard. It

24

would, however, have been open to the Minister to consider whether it was just to

exclude any of the owners from the possibility of farming their own land for a period of

thirty-seven years, allowing for the possibility of the lease being renewed. Bolger's letter

on behalf of the Minister of Maori Affairs, however, did not suggest the possibility of a

change in the existing position.

3.2 The Escalation of Controversy over Papatarata A2

Despite the dampening ministerial letter that he had received, Hovell continued to buy up

shares in Papatarata A2. On 18 April 1978, the District Officer, Gisborne, reported that

since 22 November 1977, Hovell's shares had increased to 695.516 out of a total of 2155

shares in the block, through the completion of several vesting orders. Two further similar

applications, involving a further 195.527 shares, were waiting for a decision by the court.

Hovell had also filed an application to buy the shares of a Lorna Allen, although at that

point the Gisborne office had been unable to identify her as an owner.86

At the same time, the claimant remained unhappy about the situation of Papatarata A2. In

March 1978, the Minister of Maori Affairs asked the Secretary of Maori Affairs,

I P Puketapu, to investigate the matter. Hovell had told the Minister that the Judge of the

Maori Land Court had told him that the Minister of Maori Affairs could instruct the

Maori Trustee to have the lessee removed for breach of covenant. 87

Under section 239(1) of the Maori Affairs Act 1953,

On application by or on behalf of the owners of any Maori freehold land held under lease, or without requiring any such application in any case where he thinks fit so to do, the Maori Trustee may, in his own name or in the name of the owners, exercise all rights of action, distress, or re-entry or other rights of the owners in respect of the land as if he were the owner

85 Background Brief to Papatarata [by R D Hovell], among loose papers with 2 files returned by Dr Chambers, Counsel for Maori Trustee in 1986 High Court case, to Maori Trustee. The claimant seems to have made an arithmetical error, however, in that he says that the transfer to Johnson involved 28 years. 86 District Officer, Gisborne, to Head Office, attention Atkinson, 18 April 1978, AAMK 86911191a, NA Wellington 87 Minister of Maori Affairs to Secretary of Maori Affairs, 28 March 1978, AAMK 869/1191a

25

thereof, and may exercise any such rights whether or not the lease has expired or has been otherwise determined.

Section 34 of the Maori affairs Amendment act 1974 amended this section by adding the

following subsection:

(3) The Maori Trustee shall exercise the powers conferred on him by subsection (1) of this section in any case where he is directed by the Minister in writing to do so.

Hovell's comment about the powers of the Minister of Maori Affairs apparently referred

to this legislation. The Assistant Maori Trustee consequently asked the Gisbome office

for the latest inspection report and for comment as to whether there was 'any reasonable

ground for removal of the lessee.'88

The District Officer, Gisbome, admitted that the latest inspection had shown that no work

had been done following the service of the notice. The inspector had reported that the

lessee attributed this to waiting for a bulldozer to cross the river and level the fence line.

The District Officer stated that the river had been for many months at its lowest level for

many years. Consequently, he did not see the lessee's statement as 'a valid reason for

delay'. He therefore told the Assistant Maori Trustee that they would, subject to his

approval, re-enter the lease as soon as possible after 31 May 1978. Rent had been paid up

to that date.

Despite his concession that the lessee had done nothing whatsoever to remedy the long

standing breaches of covenant, the District Officer remained less than enthusiastic about

this course of action. He foretold loss of income to the other owners. He queried the

ability of Hovell to raise finance, pay the rent and do any development work on

Papatarata A2. This was based on the fact that Hovell was a Gisbome builder. He

continued to maintain that Johnson, the lessee, was in a better position to develop the land.

88 Assistant Maori Trustee to Gisbome, 6 April 1978, AAMK 869!1191a, NA Wellington

26

than the claimant. He predicted a last minute effort by the lessee to prevent re-entry by

bulldozing and fencing. 89

On 8 May 1978, the Minister of Maori Affairs admitted to Hovell that up to two weeks

earlier the lessee had 'done little or nothing' to fulfil the covenants in the lease. He told

the claimant that the Maori Trustee would arrange for an inspection in early June, after

the period for which rent had been accepted finished on 31 May. Again, however, he

warned that the lessee might retain the lease if he could show work in progress on the

block. He indicated that there could be no assurance that Hovell would be able to lease

the block even were it to be repossessed by the Maori Trustee. He concluded by stating

that the Minister of Maori Affairs could only instruct the Maori Trustee 'if the Maori

Trustee failed to act in the interests of the owners.,90

Hovell responded with a vigorous attack on the Maori Trustee. He queried why the

trustee, having given the lessee six months to remedy the breaches in the lease, had given

him a further two months.

I would respectfully suggest, Sir, that in this case there is ample evidence that the Maori Trustee has not acted [in the owners' interests] for the past thirty-three years, otherwise river protection work, fencing and scrubcutting would have left some trace of evidence. This property has never been farmed in a husbandlike manner as agreed to in the lease contract by Mr Johnson.

In the Ruatoria Maori Land Court minutes of which you have a copy, it is recorded that breaches of the contract have been carried out by previous lessees up to the time the present lessee took over. I feel this reinforces my claim that the Maori Trustee has not been acting in the interests of the owners. Obviously regular inspections have not been carried out, and if I had not laid a complaint in the Land Court in July 1977, this state of affairs would have continued indefinitely.91

89 District Officer, Gisbome, to Head Office, attrI Atkinson, 18 April 1978, AAMK 869/1191 a, NA Wellington 90 Minister of Maori Affairs to Hovell, 8 May 1978, AAMK 86911191a 91 Hovell to Minister of Maori Affairs, 17 May 1978, AAMK 86911191 a

27

He said that the lessee had began to bulldoze scrub in mid May. He complained, however,

that this course of action undertaken at the approach of winter would detrimentally

disturb the topsoil at a time when no regrassing programme could follow. 92

The Assistant Maori Trustee instructed the District Officer, Gisborne, that rent was not to

be accepted for Papatarata A2 unless there was a report from the Field Officer showing

that substantial and acceptable remedial work was under way.93 In reply to a question

from the Assistant Maori Trustee as to why no inspection had been made between

January 1975 and 2 June 1977, the District Officer said that they knew from 'frequent

casual observations' that no work was taking place on the block. Consequently he

considered that inspections would have been pointless. 'Casual inspections' had also

taken place between 2 June 1977 and 9 March 1978.

The District Officer admitted that they had made a mistake in not issuing a section 118

notice earlier, 'say January or February 1976'. He also conceded that rent had been

'inadvertently accepted' to 31 May 1978.94

On 4 June 1978, J S McCreadie, the Ruatoria Field Officer, inspected the block. He

reported that these improvements and materials had just been put on the block:

(a) Scrub clearance - by bulldozer with blade - topsoil just skimmedLight to medium scrub - 5.8 acres at $60 p.a. value - $348.

(b) 80 yards of track from lower terrace to higher terrace - cost approximately $20; value in itself difficult to determine - but .as the track is, the difference between getting a wheeled vehicle on to the plateau or not, value probably exceeds cost - $100 ? .

(c) Stacked nearby are 247 No 2 full-round Tanalised Pine fence posts - cost value landed in Te Araroa at 4.6.78 -

$568 and 6 Coils (3cwt) of 12 liz High Tensile (plain) fence wire. Cost landed in Te Araroa 4.6.78 = $114

92 Hovell to Minister of Maori Affairs, 17 May 1978, AAMK 86911191a, NA Wellington 93 Assistant Maori Trustee to District Officer, Gisborne, 30 May 1978 ,AAMK 86911191a 94 District Officer, Gisborne to Head Office, 9 June 1978, AAMK 86911191 a

28

Total =$1130.95

The District Officer considered that the land had been neglected while leased to Waikare.

He was aware that this neglect had continued through the term of the lease to Raroa and

then to Johnson. The section 118 notice had produced minimal results, even after the

lessee had had extra time to take action. Yet the District Officer still saw little chance of

success in taking legal action against Johnson.96

On 5 July, Hovell wrote to the Minister of Maori Affairs again, asking for information

about the recent inspection of the property. He told the minister that he considered 'the

local Maori Affairs Dept. to be biased towards the present lessee. ,97

The Minister's reply on the whole defended the actions of the Maori Trustee. He said that

up to late 1964, the Maori Trustee only had authority to collect and distribute the rent. He

put the blame for approving leases to people unable to farm the land properly on the

owners. He said that in late 1964 the Maori Trustee was given authority to act on behalf

of Maori lessors to work to enforce compliance with lease covenants over and above the

payment of rent. He defended the Maori Trustee's position during the final years of the

Waikare lease:

. .. little could be done in a short time where the owners of land had granted leases to persons without assets or ability to farm. If these lessees paid their rent and the owners had condoned breaches of covenant for many years the Maori Trustee was obliged to try persuasion first. 98

He denied that the Maori Trustee had begun action against the lessee only because Hovell

had complained to the Maori Land Court. His only concession to Hovell's concerns was:

My enquiries show that action against Mr Johnson could possibly have been started a few months earlier but otherwise the Maori Trustee has acted properly in the interests of the lessors.99

95 J S McCreadie to Martin, Gisborne, 6 June 1978, fo1362, AAMK 86911191a, NA Wellington 96 District Officer to Head Office, 13 June 1978, AAMK 86911191 a 97 Hovell to Minister of Maori Affairs, 5 July 1978, AAMK 86911191 a 98 Minister of Maori Affairs to Hovell, 13 July 1978, AAMK 869/1191a 99 same letter, same file

29

The lessor left the bulldozer standing on Papatarata A2 over the winter, but did little

further work on the block. The weather provided a reason, or an excuse. 100 The District

Officer suggested collecting rent and giving the lessor further time to remedy the

breaches. Head Office refused to allow this.lOl

In the meantime, the claimant was continuing his efforts to buy further shares in the

block. l02 On 4 September 1978, P W Cooper of Woodward Iles & Co., acting for Hovell,

wrote to the Maori Trustee for confirmation that if the lessee failed to remedy the

breaches by 31 March 1979, the Trustee would issue proceedings for re-entry.

Alternatively, Cooper asked for confirmation that the lessee would not be granted

extensions of time past 31 March 1979.103 B F Bennett, the District Solicitor in Gisborne,

instead gave a more general assurance that the Maori Trustee would place 'maximum

pressure' on the lessee to 'begin development work up to date'. If this did not happen, the

Trustee would institute proceedings for re-entry and damages

On 14 September 1978, Bennett wrote to Johnson, threatening legal proceedings if work

on the block did not start at once.104 Apparently the lessee was having minimal work done

at this time. l05 On 23 November 1978, Head Office authorised Gisborne to begin

proceedings against Johnson for continuing failure to comply with his lease covenants.

Atkinson said that

Within your discretion, you may direct action toward re-entry but as rent appears to have been tendered and accepted, further notice under Sn 118

]00 District Officer, Gisbome, to Head Office, 17 July 1978; Same to same, 10 August 1978, both in AAMK 86911191a, NA Wellington ]0] District Officer, Gisbome, to Head Office, 10 August 1978; R J Nicklin for Maori Trustee to Gisbome, 17 August 1978, both in AAMI( 86911191 a

]02 District Officer, Gisbome, to R K Grayson, 20 September 1978; Sandy Hovell Circular to Owners, with certain details filled in, 24 August 1978; Grayson to Secretary, Maori Affairs, Gisbome, 5 September 1978; all in AAMK 86911191a ]03 P W Cooper for Woodward, Iles & Co, 4 September 1978, 18/130/2 vol 1, Maori Trustee, Gisbome Office ]04 District Solicitor to Johnson, 14 September 1978, AAMK 86911191a, NA Wellington ]05 McCreadie to Martin, Gisbome, 29 September 1978; McCreadie to Evans, Gisbome, 13 November 1978, both in 181130/2 vol 1, Maori Trustee, Gisbome Office

30

Property law Act 1952 appears necessary. Lessee may be informed that the terms of the notice are to be strictly interpreted. 106

A Plaint Note in the Magistrate's Court, Gisbome, between the Maori Trustee, operating

under section 239 of the Maori Affairs Act 1953, and Harry Johnson of Ruatoria, is dated

9 March 1979. 107 The plaintiff stated that the defendant had failed to comply with the

section 118 notice. He claimed:

(a) An Order of [the] Court determining the estate and interest of the Plaintiff under the lease.

(b) The sum of $1049.40 being rent and commission for the period 1.6.77 to 30.11.78.

( c ) Such other relief as the Court deems meet. (d) The costs of these proceedings. 108

The Maori Trustee continued to refuse to accept rent. 109 The defendant requested further

time. lIO On 29 June 1979, McCreadie, the Field Officer at Ruatoria reported that total

work done had increased to 28 acres of land cleared, 55 chains of fence partly built and

30 chains of fence lines laid. He put the total value of this work at $3930. 111

In July 1979, D G Witters, who was now acting for Hovell, wrote to the District Solicitor

of the Department of Maori Affairs, Gisbome:

I note the advice in ... your letter [of 3 July 1979] that the action for forfeiture is unlikely to succeed because of the attempts made by the tenant to comply with the lease covenants. I have similarly advised my client but he wishes to proceed with the action as his main concern is to prevent a renewal of the lease at the expiration of the 21 year term and he wishes to record at this stage his objection to the breaches of covenant by the leasee. [ sic]

106 A B Atkinson for Maori Trustee, Head Office, to Gisbome, 23 November 1978, AAMK 869/1191a, NA Wellington 107 Plaint Note No 290179, 18/130/2 vol I, Maori Trustee, Gisbome Office 108 Statement of Claim, In the Magistrate's Court Held at Ruatoria [sic] Between the Maori Trustee ... and Harry Johnson ... , 18/130/2 vol 1 109 Example of refusal to accept rent: B R Green for Maori Trustee to The Manager, Dalgety N Z Ltd, 12 June 1979, 18/130/2 vol 1 110 Wilson, Barber & Co to Maori Trustee, 8 June 1979; same to same, 22 June 1979, both in 18/130/2 vol 1 111 McCreadie to Martin, Gisbome, 29 June 1979, 18/130/2 vol 1

31

Should the Maori Trustee be prepared to instruct me to act on his behalf in this matter Mr Hovell would meet my costs and the costs of the action including filing fee etc to date. 1l2

The Maori Trustee asked Witters to act on his behalf, on the understanding that Hovell

would meet the costs of the action. At the same time, Witters was supplied with a copy of

a memorandum from Dalgetys on work completed. Witters was told it seemed that if the

lessee continued to remedy breaches of the covenant at the rate he had been doing, he

would have fully complied with the section 118 notice by the time the matter came to

hearing. 113

The District Solicitor was apparently unenthusiastic about the idea of legal action being

taken against the lessee. He told the solicitors for the lessee that

A principal owner in the block has objected to the Maori Trustee's handling of the matter and has instructed Dan Witters to act and proceed to a hearing. While 1 do not favour this action it has been agreed that Mr Witters would take over the Maori Trustee's action to save further delays.114 [Emphasis added]

In August 1979, Hovell was still not satisfied that the breaches of covenant had been

remedied. His solicitor indicated that Hovell wished to proceed to a hearing. lJ5

On 3 September, McCreadie reported that he had measured work done on the block. This

now amounted, according to him, to

• 120 acres of land rootraked and windrowed;

• 81 chains of 9 wire fence completed; and

• 62 chains of 9 wired fence materials laid out.

He valued this work at $13,992. He noted in his memorandum that during his visit to the

block

112 Witters to District Solicitor, Gisbome, 6 July 1979, 18/130/2 vol 1 IIJ District Solicitor to Witters, 19 July 1979, 18/130/2 vol 1 114 District Solicitor to Wilson, Barber & Co, 20 July 1979, 18/130/2 vol 1

32

Mr Johnson was with me, and has these figures in his possession - they will probably be used in the forthcoming Court case.!16

The following day, Johnson's solicitor wrote to his client, indicating that the 'Hovell

Bros.' had obtained a fixture in the Magistrate's Court in Gisbome for 1 October 1979.

He stated that his firm were going to try to obtain 'an impartial report' from the Maori

Trustee. In a note on this letter directed to the Maori Trustee, the solicitor indicated that

they understood that the breaches of covenant had been remedied, and that his firm

'would be obliged if we could have your confirmation on that point.' 117

Witters, the solicitor representing Hovell and now acting for the Maori Trustee, asked the

District Solicitor, Gisbome, to arrange for a departmental representative to appear at the

hearing. The representative was to produce the lease document, to prove service of the

notice on the lessee and to give evidence that the Maori Trustee had accepted no rent

since the issue of the notice.1l8

The day before the case was due to be heard, McCreadie re-inspected Papatarata A2 'in

the company ofMr H. Johnson'. His report continued:

The Hovells and their solicitor Mr Witters were also on the block while we were there. Mr Johnson has the following figures, and presumably they were presented in Court yesterday at the HOVELLS vs JOHNSON sitting:

(a) 120 acres of land rootraked & windrowed at $80 per acre Value $9600

(b) 157 chain 9 wire Soil con fenceing completed at $40/chain Value $6280

(d) 25 Tonne fertiliser flown on existing grassed area Cost $2250

(d) Ditchdigger - (still working) - 5 chains deep drain (4 hours) Cost $ 100

115 Witters to District Officer, Gisbome, 10 August 1979, 18/130/2 vol 1, Maori Trustee, Gisborne Office 116 McCreadie to Martin, Gisbome, 3 September 1979, 18/130/2 vol 1 117 Barber of Wilson, Barber & Co, to Johnson, 4 September 1979, 181130/2 vol 1 118 Witters to District Solicitor, Department of Maori Affairs, Gisbome, 27 September 1979, 181130/2 vol 1

33

(e) First 4 acres of Rough-rush covered Country disced up (still working) Cost $ 160

$18390119

On 1 October 1979, the Trust Officer B R Green appeared in the Magistrate's Court to

present the lease documents, transfer, deed of covenant and other documents. Barber, who

was representing the lessee, then asked that the officer show in writing authority to appear

on behalf of the Maori Trustee. Green was unable to do this, or to prove service of the

section 118 notice. Consequently, Witters elected to be non suited. 120 Green wrote a file

note on the incident reflecting his embarrassment. He believed that the incident 'reflects

on the Maori Trustee particularly as this was in open Court with the general public

present.' 121

Barber argued that, on the basis of the inspection made on 30 September 1979, the

breaches set out in the section 118 notice had been remedied, and that the Maori Trustee

'should not reasonably proceed with the summons'. 122

But the Maori Trustee had agreed with Hovell that the summons would proceed.123 The

District Solicitor did, however, agree to a request by Barber, on behalf of the lessee, that

McCreadie would be present at the hearing of the case, so that the defendant would not

have to subpoena him. The District Solicitor also indicated that 'the Maori Trustee is not

taking an active role in these proceedings' .124 Nevertheless, the Maori Trustee refused to

119 McCreadie to Martin, Gisbome, 2 October 1979, 18/130/2 vol 1, Maori Trustee, Gisbome Office 120 Note for File, B R Green, 2 October 1979; Witters to District Solicitor, 4 October 1979, both in 181130/2 vol 1 121 B R Green, Trust Officer, Note for File, 2 October 1979. Typed original said 'I believe that it does not reflect on the Maori Trustee ... ', but 'does not' was subsequently crossed out, and an's' added to 'reflect'. 122 Barber for Wilson, Barber & Co to Maori Trustee, 15 October 1979, 18/130/2 vol 1 123 District Solicitor to Wilson, Barber & Co, 18 October 1979, 18/130/2 vol 1 124 Barber for Wilson, Barber & Co to Maori Trustee, 29 October 1979; District Solicitor to Wilson, Barber & Co, 31 October 1979 (source of quotation), both in 18/130/2 vol 1; Wilson, Barber & Co to Maori Trustee, 19 December 1979; B R Green for Maori Trustee to Wilson, Barber & Co, 19 February 1980, both in 181130/2 vol 2, Maori Trustee, Gisbome Office

34

agree to the transfer of the lease from Harry Johnson to his son Richmond Johnson until

the disposal of the proceedings had taken place. 125

In early 1980, Hovell called at the Gisborne Office of the Maori Trustee. He apparently

asked that the Maori Trustee authorise Witters to take action about breaches of covenant

in the lease other than those specified in the section 118 notice. He seems to have been

particularly concerned about the removal of native trees, including kahikatea. The Maori

Trustee refused to take any further action at that stage. The District Solicitor pointed out

that Hovell, as an owner, could instruct Witters to do this on his behalf. 126

3.3 The 1980 District Court Case and its Aftermath

The matter was finally heard in the Gisborne District Court on 14 April 1980. The judge's

decision was in favour of the defendant, the lessee. Hovell was left to pay the resulting

costs.127 Hovell was decidedly unimpressed with the involvement of the Maori Trustee

and his representatives. Witters pointed out to the Maori Trustee that

Mr Hovell went to considerable expense to obtain the evidence of a registered surveyor confirming that the boundary fencing carried out by Mr Johnson was less than that required by the Lease and that little, if any of the fencing was in fact on the boundary of the property. He further obtained survey evidence that only 6 acres had been cleared, grassed and topdressed as provided by the Lease. That survey evidence substantiated Mr Hovell's contention that the Lessee was clearly in breach of the Lease as amended by the Deed of Covenant executed in December 1974.

The defendant called evidence from the Maori Affairs Department's Field Officer at Ruatoria which conflicted with the evidence given by the surveyor. Bearing in mind the respective qualifications of the surveyor and Mr McCreedy [sic] it seems virtually certain that the Court would have been obliged to prefer the evidence of the surveyor. That being the case the court would have been left with little option but to find that Mr Johnson was in breach of the lease.

125 Wilson, Barber & Co to Maori Trustee, 23 November 1979; Joy Evans for Maori Trustee to Wilson, Barber & Co, 24 January 1980, both in 18/130/2 vol 2, Maori Trustee, Gisbome Office 126 Undated note by B R Green, Trust Officer, to District Officer, with minute by District Officer; District Solicitor to Witters & Rishworth, 13 February 1980, both in 18/130/2 vo12 127 Witters & Rishworth to Maori Trustee, 16 April 1980, 181130/2 vol 2

35

However, the Court did not have to give consideration to these matters as Mr Bennett, the District Solicitor for the Department of Maori Affairs, gave evidence that the Maori Trustee was satisfied that the breaches of the Lease had been remedied. On the basis of this evidence the Magistrate gave judgment for the defendant. 128

Hovell felt that if the department had decided that the breaches had been remedied and

had decided to give evidence accordingly, they should have advised him that they would

not proceed with the claim, and instructed Witters and Rishworth accordingly. Hovell

considered that the Maori Trustee had not 'acted in the best interests of the owners of

Papatarata A2 Block' .129

Hovell took his concerns to R L Bell, the Member of Parliament for Gisborne. He raised

with him his concerns that, in the Maori Trustee versus Harry Johnson, Bennett and

McCreadie of the Department of Maori Affairs had supported the defendant. He also

raised the issue of the partial clearing of 70 acres of regenerating native bush, as well as

the erosion of river flat land in the block. 130

Subsequently the Gisborne Trust Officer, B R Green, admitted that there had been 'a

substantial discrepancy' between the evidence given by Cox, the surveyor employed by

Hovell, and McCreadie. He claimed, however, that even on Cox's evidence, there had

still been 'substantial compliance' with the section 118 notice. He said that if the word

"satisfied" had not been used in their discussions with Hovell, then it should have been

clear from their action in not prosecuting the matter themselves that they were in fact

satisfied. 131

128 Witters & Rishworth to Maori Trustee, 16 April 1980, 18/130/2 vol 2, Maori Trustee, Gisbome Office [Note that this letter is filed with the fIrst page in front of the other letter, same to same, of this date, and the later 2 pages of this letter behind this other letter.] 129 same letter, same fIle 130 Bell to Minister of Maori Affairs, 23 April 1980, 18/130/2 vol 2 131 Memorandum B R Green to Mr Coubrough, 9 May 1980, 18/130/2 vol 2

36

The Minister of Maori Affairs asked the Maori Trustee 'to consider the lessee's action in

partially clearing 70 acres of regenerating native bush' .132 The Minister met Hovell in

person, probably on 9 May 1980, to discuss Hovell's concerns. Following this meeting,

the Minister informed Hovell that the Maori Trustee felt it unlikely, given the recent

expenditure on the property by the lessee, that the Court would agree to revoke lohnson's

lease. He also stated that the Maori Trustee could not 'unreasonably withhold his consent

to a transfer of the lease'. He suggested that Hovell should ask the lessee for an option to

purchase the lease, as an alternative to the transfer ofthe lease to the lessee's son.133

The situation now became decidedly more acrimonious. Hovell wrote to the Minister of

Maori Affairs again, complaining about destruction of native trees and erosion. More than

that, however, he accused the Maori Affairs Field Officer McCreadie of giving 'false

evidence'. He asked the Minister to hold a 'full enquiry'. He asserted that there was:

certainly ample evidence of double-dealings by your Department, and false or glossed-over reports to you from the Gisborne Department. 134

The District Solicitor, Gisborne, insisted that it had been repeatedly made clear to Hovell

and his solicitor that the section 118 notice had been complied with. He stated that 'there

can be no doubt as to the competence, reliability and conscientiousness of Mr

McCreadie.' He admitted that there were discrepancies between the evidence given by

McCreadie and that of the surveyor employed by Hovell. He attributed this largely to the

superior quality of the surveyor's equipment. At the same time, he downplayed the

significance of the differences in evidence. 135

McCreadie himself commented on the issue ofthe destruction of Native Trees:

... that within the main body of rootraking, minor, "scrubby" type trees which are probably "Native" to New Zealand have been rootraked BUT the biggest and best have been left AND if the dozers had not been able to

J32 Minister of Maori Affairs to Bell, MP, undated, 18/130/2 vol 2, Maori Trustee, Gisborne Office 133 Minister of Maori Affairs to Hovell, 26 May 1980, 18/130/2 vol 2 134 Hovell to Couch, 29 May 1980, 18/130/2 vo12 135 Notes on Papatarata A2 by District Solicitor, undated, folios 229-227 in 18/130/2 vo12

37

penetrate the major canopy, there would have been little or no rootraking done, which is the major point of the whole exercise. l36

R J Nicklin, writing for the Secretary of Maori Affairs, asked Gisbome to let them know

when the block was next due for inspection, and asked for a copy of the inspection report.

He urged care over any transfer of the lease. Yet minutes on this communication indicate

that the staff of the Gisbome Office were 'satisfied that the Lessee has complied as far as

can be practicably expected.' The next inspection was consequently diaried for July

1983.137

Hovell wrote to the Minister of Maori Affairs yet again. He said that the native trees

destroyed were not scrub, but 'white pine, rimu, totara and tawa tees - some at least forty

to fifty years old.' He claimed that the Maori Trustee 'at no time said or indicated he did

not support my case.' He stated that each of the court proceedings had been held on a

Monday, and that on both occasions the field officer had inspected the block the Sunday

before. He said that 'surely this is not usual practice'. He indicated that he could not

understand why complaints of unethical conduct were not 'thoroughly investigated'.138

McCreadie inspected Papatarata A2 again on 30 October 1980. He reported that, since the

inspection of 13 April 1980, 85 acres sown in crop and new grass had been reworked and

sown in new grass, following the failure of the first sowing. The approximate cost of this

was $6500. A further 15 acres of heavy scrub had been windrowed. He gave the

approximate value of this work as $1800. Adding these figures to the 'Accumulated Costs

& Value Increase at the date of the last inspection', he arrived at a total figure of

$35,403.139

B R Green, the Gisbome Trust Officer, denied any impropriety on the part of local

officers. He described the assertion that Johnson was being continually protected as 'a

136 J McCreadie, 'Ministerial Enquiry - Folio 223', /6/80 [sic], 18/130/2 vol 2 J37 Head Office to Gisbome, 22 July 1980, and Minute of? Kapa to Green, 30 July 1980, 18/130/2 vol 2 138 Hovell to Minister of Maori Affairs, 22 September 1980, 18/130/2 vol 2 DB

38

laughable accusation. He termed McCreadie's Sunday inspections as going 'the second

mile in his duty and devotion to his job' .140

The situation was further complicated by the death of the lessee, Harry Johnson, on 28

November 1980.141 The Minister of Maori Affairs later told Hovell that, if anything, the

death would incline a court to increased leniency towards the lessee.142 In January 1981,

Hovell complained again to the Minister of Maori Affairs that the property was 'in a

continued state of utter neglect' .143 In February 1981, R L Bell, the Member of Parliament

for Gisborne, approached the Minister of Maori Affairs again on behalf of Hovel1. He

commented that he was sure that Hovell would 'welcome and abide by the advice of an

independent arbitrator.' 144

The Minister indicated to Hovell that he was satisfied that Johnston [sic] had received

'the same treatment as any other lessee of similar land' and that the officers of the Maori

Trustee had 'acted honestly impartially and in good faith'. Since Hovell did not accept

this, he offered Hovell the option of obtaining through the District Officer of the

Department of Maori Affairs, Gisborne, an independent opinion from M J Fitzharris.

Fitzharris was a Senior Farm Advisory Officer of the Department of Agriculture and

Fisheries. 145

To Bell, the Minister stated that:

There is no doubt that the lessee is in default but the practicality of a successful action at law has to be faced, weighing the cost to the owners against the prospects of success in securing possession.146

139 McCreadie to Green, Gisborne, 3 November 1980, 18/130/2 vo12, Maori Trustee, Gisborne Office 140 B R Green Trust Officer, 'R.D. HOVELL - MINISTERIAL' undated, 18/130/2 vol 2 DB 141 For date of death: Barber of Wilson, Barber & Co to Maori Trustee, 7 January 1981, 18/130/2 vol 2 142 Minister of Maori Affairs to Hovell, 8 June 1981, 18/130/2 vo12 143 Hovell to Minister of Maori Affairs, 29 January 1981, 18/130/2 vol2 144 R L Bell to Mmister of Maori Affairs, 5 February 1981, 18/130/2 vol2 145 Minister of Maori Affairs to Hovell, 11 February 1981, 18/130/2 vol 2 DB 146 Minister of Maori Affairs to Bell, 19 February 1981,181130/2 vol 2 DB

39

John Fitzharris subsequently reported on the block. He pointed out that to fulfil the

covenants in his lease, Johnson should have carried out 2802 metres of boundary fencing

and 63 hectares of new grassing over a 6 year period. He estimated that there had been

2200-2300 metres of fencing done that could be taken as boundary fencing, along with 37

hectares of new grassing. He also noted, however, that the Rural Bank had authorised

loans to cover 6000 metres of fencing and 84 hectares of land development.

Despite this, Fitzharris was clearly concerned about the attitude that had been tal<:en by

the lessee towards the development of the block. He admitted that the sons of the now

deceased lessee might take a different attitude to this. But he commented that:

The Papatarata A2 Block, has not been farmed in a management sense, but rather been treated as a grazing proposition. To some extent this has been brought about by the little grazable [sic] agrea [sic], few fences, distance from the "home" operation, and the attitude of the lessees. In the future, this overall situation is unlikely to change, with the present occupIers barely just doing enough to maintain them in the lease.147

He also remarked that:

... Mr Johnson probably was allowed to exist on this lease, with little effort of improvement, to the extent that it is not only his fault for the total and overall situation that exists today.148

At any rate, the report indicates that the lessee had failed to keep the covenants into which

he had entered regarding boundary fencing and grassing. It also indicated that Fitzharris

was decidedly unimpressed with the standard of management of the block.

Given this, the conclusions of D G Webb, the District Field Officer who reviewed the

reports of Fitzharris and McCreadie, are fascinating. Webb concluded that Fitzharris and

McCreadie were 'basically in agreement' as regards the amount of work done. He

admitted that the amount of work done did 'not strictly comply with the covenant'.

Despite this, he argued that the work had 'largely been done'. He considered that the loan

147 Fitzharris Report, folios 526-523, AA VN W3599 54/91120, NA Wellington. Quotation from page 4 of report. 148 Same report, same file

40

obtained by the Johnsons to do development work on the block indicated that they

intended to develop as much of the block as was possible. He thought that nobody in the

immediate area of the block could farm it better. He apparently thought the comments of

Fitzharris on the farming methods ofthe lessees were irrelevant. 149

Meanwhile, Hovell had written to the Minister of Maori Affairs again on 18 February

1981. Couch's attitude to Hovell is indicated in a minute on this letter: 'This fellow will

never be convinced'. ISO

On 18 June 1981, the Minister of Maori Affairs sent a further letter to Hovell. In this, he

conceded that there had been discrepancies regarding fence lengths and areas cleared in

the evidence given to the District Court. He also admitted that an oversight in the rent

collection procedures of the Maori Trustee had led to 'undue delays' in the date that

action could be taken against the lessee. He told Hovell, however, that he was unaware of

any way in which the lease could be forfeited. He stated that 'no useful purpose' would

be served by a meeting between him and Hovell. He said that it would be 'pointless' for

him to continue to correspond with Hovell. lsl

Hovell apparently decided to try a different approach. On 8 July 1981, on the advice of

Bell, the Gisborne Member of Parliament, he wrote to the Ombudsman to 'ask for an

investigation into dealings I have had with the Maori Affairs Department' .152 On 10

August 1981, after failing to gain satisfaction from the Ombudsman, Hovell wrote to

Robert Muldoon, the Prime Minister:

as a last resort to find out who, under our present democratic system, I can approach to conduct an inquiry into the giving of evidence by a Government Department employee while under oath, that was completely untrue. 153

149 District Field Officer to Mr Green re Papatarata A2, 8 June 1981, folio 271, AA VN W3599 54/91120, NA Wellington 150 Hovell to Couch, 18 February 1981, minute by 'BC', 20 February 1981, AA VN W3599 54/91120 DB 151 Minister of Maori Affairs to Hovell, 18 June 1981, 181130/2 vol2 DB 152 Hovell to Ombudsman, 8 July 1981, AA VN W3599 54/91120 153 Hovell to Muldoon, 10 August 1981, AAVN W3599 54/91120

41

At some point, Hovell apparently also wrote to the Minister of Justice, and to Bill

Rowling, the Leader of the Opposition. 154

Bell and, in 1982, the former Minister of Maori Affairs, MacIntyre, both seem to have

involved themselves repeatedly in Hovell's attempts to get the Minister of Maori Affairs

to act on his concerns. Yet it was apparently not primarily political activity, but further

reports from professional people on the East Coast that finally began to change the

attitude of Head Office staff of the Maori Trustee. On 25 August 1981, Witters,

Rishworth & Wall, acting for Hovell, wrote to the Maori Trustee, enclosing further

reports from the registered surveyor B C Cox and the registered valuer G H Kelso. They

claimed that this material showed that there were 'substantial breaches of the lease'. They

also understood that the lessee was in arrears with the rent, that the lessee intended to

burn debris, which would destroy native trees, and that drains, ditches and watercourses

had not been kept clear. These matters constituted further possible breaches of the lease.

Through his solicitors, Hovell consequently requested the Maori Trustee to authorise the

issuing of proceedings against the estate of Harry Johnson for the forfeiture of the lease

and, if necessary to combine that action with a claim for damages, for instance regarding

the destruction of native trees. Hovell also asked the Maori Trustee to instruct Witters,

Rishworth & Wall to act on behalf of the Maori Trustee as lessor. 155

Cox's report compared the measurements made by him and by McCreadie. He concluded:

While it is to be expected that there would be minor differences between area and length details recorded by myself and Mr McCreadie in April of 1980, I find it disturbing that those differences are substantial, that they are all in the same direction, eMr McCreadie giving the lessee credit for more development than has in fact taken place) and that this is the information on which the Maori Trustee has judged the performance of the lessee.156

154 Background Brief to Papatarata [by R D Hovell], in loose papers with two files returned by Dr Chambers, Counsel for the Maori Trustee in 1986 High Court case, to the Maori Trustee 155 Witters, Rishworth & Wall to Maori Trustee, 25 August 1981, 181130/2 vol 2, Maori Trustee, Gisborne Office 156 Report by Cox, 23 July 1981, folios 545-543, AA VN W3599 54/9/120, NA Wellington

42

When he gave evidence before the High Court in 1986, Cox commented on the 1980

District Court hearing. He went so far as to term a plan prepared by an officer of the

Maori Trustee as 'a disreputable plan which showed figures substantially different from

those which were in the court on that occn.'(emphasis added)157 This is presumably

another reference to the discrepancy between his figures and those produced by

McCreadie.

In view of the defensive attitude displayed shortly after the 1980 District Court case by

Maori Affairs and Maori Trust office staff and by the Minister of Maori Affairs, it is

instructive to read a memorandum of Richard Wickens about the 1980 case. This

memorandum was written for Robinson, the Maori Trustee, on 31 July 1987. Wickens

became the Deputy Maori Trustee in July 1987.158 He wrote:

The evidence produced by Hovell at his own expense was very much at variance with that produced by our own then lease inspector, Mr McCreadie. The fact that such evidence was ultimately sufficient to secure forfeiture of the lease and damages and costs totalling $40K attests to the degree of divergence. The reports no doubt reflect different poles of sympathy, but even allowing for that the degree of divergence is still unaccountably wide. In actual fact it is also difficult to justify a divergence of sympathy as Mr McCreadie should have had regard to the lessor's not the lessee's interests, and therefore there should have been correspondence of view rather than the opposite.

I do believe that had the report by McCreadie been accurate the first case would have been won ... 159

3.4 The Demand for Action against the Lessee by Head Office

On 29 September 1981, J D T Hauraki from the Head Office of the Maori Trustee told the

Gisbome office that the letter showed that, regardless of past reports and action, the lessee

was clearly now in breach of his obligations and that the Maori Trustee must tal<:e action.

157 Transcript, High Court, Gisbome, Box: 'Al1185 Maori Trustee v Estate Harry Johnson Part file', p 103 158 For lists of Maori Trustees and Deputy Maori Trustees, see Butterworth & Butterworth, op cit, p 164 159 R Wickens to Robinson, 31 July 1987. This is a handwritten communication - signature identified as that ofR Wickens by Isobel McIntyre of the Head Office of the Maori Trustee. Fols 396 - 395, AA VN W3599 54/9/120, NA Wellington DB

43

He suggested that if the rent was in arrears, the Maori Trustee could re-enter and

determine the lease without a section 118 notice. He suggested peaceable re-entry. 160

B R Green in Gisborne apparently saw the idea of peaceful re-entry as 'naIve and

laughable,.161 In any event, it seems that rent up to 30 November 1981 had been paid on

31 July 1981.162

In any event, Hovell, in the absence of action by the Maori Trustee, sought the

intervention of Duncan MacIntyre. MacIntyre made repeated efforts to get the matter

sorted out. 163

By May 1982, however, the Gisborne Office had still taken no action to deal with

breaches of the covenants. l64 The District Solicitor still held that Hovell should be

instructed to take action through his own solicitor.165

By June 1982, the lack of action by the Gisborne Office was causing an exceptionally

high level of concern at Head Office. Coubrough, the Office Solicitor at Head Office, was

asked to investigate whether the District Solicitor, Gisborne, had breached the Public

Service Regulations 1964.166 Coubrough considered that the District Solicitor, Gisborne,

had not done so, on the grounds that Hauraki, who had written to Bennett, was not the

latter's Controlling Officer. 167 Despite this, there was considerable concern at Head Office

about what was seen as a less than helpful attitude by the District Solicitor in terms of

160 J D T Hauraki for Maori Trustee to Gisbome, 29 September 1981, 18/130/2 vol2, Maori Trustee, Gisbome Office 161 B R Green to Bennett, District Solicitor, and Best, District Accountant, 6 October 1981, 18/130/2 vo12 162 Dates on which rent has been accepted ... , folio 981 [or 987 - rather illegible], 181130/2 vol 3, Maori Trustee, Gisbome Office 163 Duncan MacIntyre to Minister of Maori Affairs, 24 February 1982, 18/130/2 vo12 MacIntyre wrote to the Minister about the matter again on 22 June 1982. MacIntyre to Minister, 14 September 1982, 181130/2 vo12 164 B S Robinson, Deputy Maori Trustee, to Gisbome, 12 May 1981, 18/130/2 vo12 165 District Solicitor to Ferris & Green, 19 May 1982, 18/130/2 vo12 166 Minute of 15 June 1982, Robinson to Coubrough on File Note by Coubrough, 'S.E.O. Trust', fo1588, AAVN W3599 54/91120, NA Wellington 167 Office Solicitor to Deputy Secretary, 24 June 1982, fo1593, AA VN W3599 54/91120

44

giving proper advice to Green about 'legal steps to be taken for and on behalf of the

owners of Papatarata A2.,168 Green was also found to have written to Hovell's solicitors

about one week after receiving Hauraki's instructions to take action. His letter was

described as 'quite misleading' because it told the solicitors that he was still waiting for a

reply from Head Office.169 It was also suggested that Ferris, who was then the Assistant

District Officer of the Department of Maori Affairs in Gisbome, could have saved

confusion and delay by picking the matter up more rapidly on review. 170

In July 1982, B R Green tried to get L F Greaves, the Lease Inspector of the Department

of Maori Affairs who was based in Wairoa, to look at Papatarata A2. Greaves, however,

questioned whether he could add anything to existing reports, particularly given that

Hovell had employed a registered surveyor and a registered valuer. He wrote:

I have heard from responsible people that further development has taken place just recently. I am unable to verify this myself as it was impossible to cross the river at the time because of [flooding]. Consequently, I can only report that further land is being cleared for new pasture and give an approximate area.

You could probably go on getting reports from qualified people and practical farmers and still not have the correct answer to suit all parties but if you insist that I must inspect this property I will do so when the river is safe to cross and also I must have your assurance that I will not appear in Court to give evidence on work performed before my inspection. 17I

Greaves had had a long and successful period as the Manager of the Maori Trustee's

Hereheretau Station in the Wairoa area.172 A minute on the copy of his comments on the

168 Memorandum to Mr Baker (initials illegible, 6 July 1982), AANV W3599 54/91120, NA Wellington 169 Office Solicitor to Deputy Secretary, 24 June 1982; Memorandum to Mr Baker (initials illegible), 6 July 1982, both in AAVN W3599 54/91120 170 Memorandum to Mr Baker (initials illegible), 6 July 1982, AA VN W3599 54/91120; On position of Ferris, see section 4.4.1.8 171 B R Green for Maori Trustee to Witters, Rishworth & Wall, 21 July 1981; L F Greaves, Lease Inspector, Wairoa, to Gisbome, 5 August 1982, both in 181130/2 vol 2, Maori Trustee, Gisbome Office 172 Katherine Orr-Nimmo, 'The Land and the Blackberry: Aspects ofthe History of the Hereheretau and Kahaatureia Blocks with special reference to Hereheretau Station and the Maori Soldiers' Fund' April 1998 (Wai 201 record of documents doc Rll), p 138

45

Head Office file, however, is somewhat scathing. It claims that access could easily be

gained to Papatarata A2 when the river was high by walking across 'neigbouring land to

the N.E.'. The minute is also high critical of a lease inspector:

who is reluctant to give us facts because of possible court proceedings.

This whole case has cast doubts about the quality of our [field] reports & subsequent follow up.' 173

3.5: Conclusion

This chapter has shown an increasingly high level of tension between Hovell and various

members of the staff of the Department of Maori Affairs, Gisborne, acting for the Maori

Trustee. The initial resistance of members of the Gisborne staff to take legal action

against the lessee are made more comprehensible by the reluctance of the courts to act

against lessees and by the problems that were associated with some leases of their own

land by East Coast Maori landowners.

There is some evidence from July 1979 that Hovell's solicitor, at any rate, was aware of

the view of the District Solicitor, Gisborne, that action for forfeiture of the lease was

unlikely to succeed because of efforts made by the lessee to comply with lease covenants.

But an October 1979 hearing about the lease collapsed not on these grounds, but on a

technicality. Whether or not the matter was primarily the responsible of the solicitor who

was acting in this case for the Maori Trustee, who was also Hovell's solicitor; or of the

Maori Affairs official representing the Maori Trustee, the fiasco did not show the Maori

Trustee in a good light.

From 1980, Hovell became increasingly concerned over actions by the lease inspector,

McCreadie, and the District Solicitor, Bennett, that appeared to him to favour the lessee at

the expense of the lessor. Yet the Maori Trustee was the agent of the owners, not of the

173 Minute (initials illegible), 9 November 1982, on Greaves, Wairoa, to Gisbome, 5 August 1982, AAVN W3599 54/91120

46

lessee. In later years, a senior member of the staff of the Maori Trustee expressed

awareness that the lease inspector appeared to be inappropriately biased towards the

lessee. The lease inspector's evidence at the 1980 District Court case was significantly at

variance from that of a qualified surveyor employed by Hovell to inspect Papatarata A2.

Had the evidence given by McCreadie been more accurate, the lessee might well have

forfeited his lease at this stage. This would have avoided the needed for further legal

action, which was to prove very costly. It would also have prevented the felling of larger

trees on the block in 1982. Some smaller trees were bulldozed during clearing of the

block in 1979 or 1980.

Ben Couch, as Minister of Maori Affairs, seems to have accepted reassurances from his

officials, despite serious accusations made to him by Hovell. While it is true that he

offered Hovell the option of an independent opinion from Fitzharris of the Department of

Agriculture and Fisheries, he defended the actions of his officers. This was despite the

fact that he admitted to Bell, the Member of Parliament for Gisborne, that there was no

doubt that the lessee was in default.

In mid 1981, Couch wrote that further correspondence with Hovell would be pointless.

Duncan MacIntryre and Bell were significantly more persistent in trying to get some

resolution of Hovell's concerns.

In September 1982, the Head Office of the Maori Trustee gave clear instructions to the

Gisborne Office to take action against the lessee for his breaches of the lease covenants.

By May 1982, however, officials in Gisborne had not yet talcen action. In June, officials

at Head Office considered disciplinary action, particularly against the District Solicitor of

Maori Affairs, Gisborne.

47

It was around about this time, however, that numerous large trees on Papatarata A2 were

apparently felled. Prompt action by Gisbome officials of the Maori Trustee in late 1981

might have prevented this development.

The administration of this lease by the Maori Trustee seems to have been unsatisfactory

during at least the later years covered in this chapter. There is evidence that of some bias

towards the lessee. Over and above this, however, the saga of the Papatarata A2 lease

during this period raises a more general question about the adequacy of the administration

of leases by the Gisbome Office of the Maori Trustee at this time.

48

CHAPTER 4: PAPATARATAA2 1982-1986

This chapter begins by describing the discovery in September 1982 of major felling of

native trees on Papatarata A2. Officials in Gisbome became very much more aware of the

need to take action against the lessee.

The next section touches on the decision of the solicitor acting for the Maori Trustee to be

non-suited in the 1983 District Court case taken by the Maori Trustee against the estate of

the lessee, who was now dead. This decision was, once more, the result of a technicality

for which the Maori Trustee or his solicitor were responsible. The section also mentions

the disposal of felled timber to Carter Holt Central Limited.

The following section describes the escalation in the scale of the case against the estate

of the lessee, and the eventual decision to transfer proceedings to the High Court.

The final section gives an indication of the nature of the enormous quantity of evidence

that was presented to Justice Smellie in the High Court, Gisbome, when the case was

eventually heard there in 1986. The plaintiff was the Maori Trustee. The defendant was

Barber for the estate of Harry Johnson. Although a settlement was reached on 4 August

1986, the action was adjourned sine die.

4.1 The Discovery of Major Felling on the Block

On 8 September 1982, Hovell; M Hockey, a New Zealand Forest Service Officer;

B Green; and A J Ferris, the Assistant District Officer of the Department of Maori Affairs

in Gisbome, visited Papatarata A2. Ferris described what he had seen on the visit:

... I am satisfied that there has been wanton destruction of native trees and a complete disregard for Clause 18 of the lease. As you are aware, this briefly provides that the lessee wi11leave any native bush growing upon the property strictly alone unless he has the written consent of the Maori Trustee to cut down damage or destroy such trees. The lessee definitely did not have the Maori Trustee's authority to do what he has done to the trees on this property.

49

· .. I am of the view that these trees should not have been interfered with and feel that drastic action is warranted. 174

Ferris informed the District Solicitor that he had reached the conclusion that the Maori

Trustee should immediately act independently, to avoid the impression of being pressured

by Hovell or of being vindictive to the lessee. The other immediate action that he asked

for was the preparation of a section 118 Property Notice incorporating breaches in the

report of Gordon Kelso. He was now satisfied that Kelso's report was 'a true and accurate

account of the situation here.' He asked Green to act urgently to find the most

advantageous way of disposing of the trees. 175

Hovell continued to press for action through political channels. On 14 September 1982,

Duncan MacIntyre wrote again to the Minister of Maori Affairs about Papatarata A2 on

behalf of Hovell. He stated that Hovell had told him that Mike Hockey of the New

Zealand Forest Service estimated that between five and seven thousand dollars of

kahikatea wood was lying on the ground on the block, 176 The Maori Trustee,

I P Puketapu, told the District Officer, Gisborne, that he had already been told that the

lease covenants were to be strictly adhered to. The Maori Trustee stated that, if this was

not occuring, appropriate measures, including steps to re-enter the lease, should be

taken. I??

Finally, on 8 October 1982, B F Bennett, as solicitor for the Maori Trustee, posted a

notice under section 118 of the Property Act 1952 by registered mail to Ronald Andrew

Barber, as the executor of the estate of Harry Johnson. 178

174 A J Ferris to District Solicitor, 9 September 1982, 18/l30/2 vol 2, Maori Trustee, Gisbome Office DB 175 A J Ferris to District Solicitor & Note to B Green at bottom ofp 2 of this, 9 September 1982, 18/130/2 vol 2 DB 176 MacIntyre to Minister of Maori Affairs, 14 September 1982, 18/130/2 vol 2 177 I P Puketapu, Maori Trustee, For Personal Attention Of The District Officer, 29 September 1982, 18/13012 vol 2 178 T G Woods, District Solicitor, to Dan Witters, 28 July 1983, 18/13012 vo12; Section 118 Notice, dated 8 October 1982, folios 23 - 25 in Exhibit 1 (Judge), from bunch of material with brown paper note: 'copy of Exhibits held in Strong Room ... 16.8.91', Maori Trustee v Ronald Andrew Barber as Executor of Estate of Harry Johnson, High Court, Gisbome

50

The notice stated that Johnson, and Barber as his executor, had failed to meet the

boundary fencing and clearing, grassing and topdressing requirements in the lease, as

modified by the Deed of Covenant. It also stated that, contrary to clause 9 of the lease,

Johnson and Barber had failed to keep clear all waterways on the land, as debris and scrub

had been 'placed in the creek running through the land.' Furthermore, it stated that,

contrary to clause 18 of the lease, Johnson and Barber had

cut down and damaged or permitted to be cut down and damaged native bush and native trees growing on the land. 179

The Maori Trustee gave notice that the lessee was to

• erect 107 chains of boundary fence within three months, and thereafter to continue to

erect boundary fence at the rate of 23 chains a year until the boundaries were

adequately fenced;

• clear, grass and topdress 103 acres within three months, and concurrently to clear,

grass and topdress at the rate of at least 26 acres a year;

• 'clear and keep clear of scrub and debris all waterways on the land within three

months';

• to remedy within one month, if it was capable of remedy, the breach regarding the

cutting down and damaging of native trees and shrubs;

• pay compensation to the lessor for the breaches of covenant. 180

The Maori Trustee indicated that if the lessee failed to remedy the breaches of covenant

within the times specified, he would enforce his rights of re-entry. 181

The following month, D Witters received instructions to act on behalf of the Maori

Trustee in an action for forfeiture of the lease, on the grounds that the lessee had failed to

comply with the covenants in the lease and with the section 118 notice.J82 Ferris accepted

179 Section 118 Notice, dated 8 October 1982, folio 24 180 Section 118 Notice, dated 8 October 1982, folios 24-25 181 Section 118 Notice, dated 8 October 1982, folio 25 182 Ferris, Assistant District Officer, to Head Office, 24 November 1982, 18/130/2 vol 2, Maori Trustee, Gisbome Office

51

an offer of $23.50 per cubic metre from Carter Holt Central Limited for the logs on

Papatarata A2. Ferris arranged for Hockey from the New Zealand Forest Service to assist

with the measurement oflogs before they were removed from the block. 183

4.2 The 1983 District Court Case

The matter eventually came before the Gisbome District Court on 26 and 28 July 1983.

Evidence was given by the surveyor Brian Cox; the valuer Gordon Kelso; Sandy Hovell;

and by a logging contractor, Desmond Philps. The latter gave evidence of visiting

Papatarata A2 in November 1982 and seeing signs that a large number of trees, possibly

300, had been felled. He testified that the value of timber would have been from $23 to

$26 per cubic metre, and that about 300 cubic metres seemed to have been felled.

Unfortunately, once again the case was unable to proceed because of a technicality.

Witters, Hovell's lawyer, was again acting for the Maori Trustee. He reported to the

Maori Trustee that:

The Counsel for the Defendant ... raised the objection that the Court did not have jurisdiction to hear the matter because there had been no formal demand for possession by the Maori Trustee. By consent the writer produced to the Court a letter demanding possession which the writer had forwarded to the solicitors for the Defendant. The Judge appeared to be prepared to accept that this was a demand and that it had been properly served on the defendant but he was unsure as to whether the demand could be served after proceedings had been commenced or whether it should have been served by the Maori Trustee prior to proceedings being commenced. It appeared to the writer that if called to decide the point the Judge was likely to rule that a demand should have been sent before the proceedings were issued and in that case he would have been obliged to enter judgment for the defendant. To prevent this course the writer therefore elected to be non-suited.

The effect of the non-suit is that the Maori Trustee is able to proceed on the original property law notice by now issuing a demand for possession,

183 Assistant District Officer to Timber Manager, Carter Holt Central Ltd, 26 November 1982, 18/130/2 vol 2, Maori Trustee, Gisbome Office

52

preferably by formal notice to quit and at the expiration of the period allowed in that notice the proceedings can be recommenced. 184

On 19 August 1983, PTe Maipi, the Director of the Department of Maori Affairs in

Gisbome, told Head Office that

The ineffective service of the notice does not reflect on the Maori Trustee, as the Solicitor on electing to bring the proceedings before the jurisdiction of the District Court is responsible to ensure all jurisdictional formalities are followed. 185

It certainly seems most unfortunate that, for a second time, a technicality significantly

delayed the resolution of this matter before a court. 186

In the meantime, Barber, the executor for the deceased lessee, Harry Johnson, was

campaigning with the Maori Trustee and various Members of Parliament for a

compromise. Te Maipi emphasised, however, that there was a prima facie case for re

entry. He reported that the notice to quit had been served on Barber. 187

Barber, the executor for the Johnson estate, then sought a settlement of the matter. 188 The

Maori Trustee, however, pressed ahead with legal action. 189

Meanwhile, the claimant was still trying to purchase further shares in the block. On 6

March 1984, however, the Maori Land Court refused to approve an alienation to Hovell.

This was on the grounds that the case being brought by the Maori Trustee might result in

a distribution to the owners on which it was at that point impossible to put a value. 190

184 D G Witters to Maori Trustee, 1 August 1983, 18/130/2 vol 2, Maori Trustee, Gisbome Office 185 P Te Maipi, Director, to Head Office, 19 August 1983, 18/130/2 vol 2 186 For first such problem, see section 3.2 187 P Te Maipi, Director, to Head Office, 19 August 1983, 18/130/2 vo12; For example of letter sent out by Barber, see Wilson, Barber & Co to Minister of Maori Affairs, 16 September 1983, fo1316, AA VN W3599 54/9/120, NA Wellington 188 Barber of Wilson, Barber & Co to District Solicitor, Gisbome, 10 November 1983,18/130/2 vol 2 189 District Solicitor to Dan Witters, 10 February 1984, 18/130/2 vol 2 190 Extract from Minutes from Ruatoria Minute Book Volume 21 folio 92, 18/130/2 vol 2

53

K G Arnold, Timber Manager of the Gisborne Branch of Carter Holt Central Limited,

strongly criticized the felling method used on the block. He referred to 'what could

almost be termed the destruction of trees' on the block. He said that a policy of selective

logging would have been ideal and practical, thanks to what he saw as 'the easy access to

the block'. He thought that 80 to 120 cubic metres of logs might be extractable. The fact

that logs had been pushed into rows ready for burning, however, made this figure

questionable. He estimated total wastage as in the 200 to 400 cubic metre range. 191

Various options for disposal of the logs were investigated. 192 On 21 February 1983, the

Papatarata A2 block account was credited with $1353.75 on account of royalties for the

sale of logs.193 Yet none of this money was ever passed on to the owners of the block.

This was because very substantial payments were made out of the block account in the

early 1980s, almost entirely in connection with the legal proceedings over the lease. 194

4.3 Escalation in the Scale of the Case

In April 1984, T G Woods, who by this stage was District Solicitor in Gisborne, asked for

instructions from Head Office about the idea of abandoning proceedings in the District

Court and instituting proceedings in the High Court. Possible damages in the case were

rising to a level that Woods saw as outside the jurisdiction of the District Court. At this

stage, he mentioned $20,000 as the sum needed to clear water-courses, and $18,000 as the

'waste' resulting from the felling of native timber. 195

On 17 April 1984, Hovell undertook to pay all fees charged by a barrister on the

condition that 'the action for damages and compensation as well as the forfeiture of the

]91 K G Arnold to District Officer, Maori Affairs, Gisborne, 17 November 1982, File: 'Maori Trustee Barber - Papatarata A2' - file of Counsel irt the 1986 High Court case, now held by the Maori Trustee. 192 Mirtute Sheet, illegible signature, 22 October 1982, fo1371, 18/130/2, Maori Trustee, Gisborne Office 193 ESTATE TRUST of Papa tarat a A2 from 23.6.82 to 16.7.87, fo11208 in 18/130/2 vo13, Maori Trustee, Gisborne Office 194 See section 5.3 195 District Solicitor to B Robirtson & M Coubrough, 12 April 1984, 18/130/2 vol 2

54

lease of Papatarata A2' proceeded to the High Court. l96 M C Coubrough, the Office

Solicitor at Head Office, asked for confirmation that Hovell had given a written

undertaking to indemnify the Maori Trustee for costs and expenses of any High Court

action. 197 Head Office was insistent about the need for an 'adequate indemnity in respect

oflegal costs' from Hovel1. 198 On 23 August, T G Woods informed Coubrough that 'Mr

Hovell has given an indemnity in respect of legal costs.' 199

This was in spite of a minute on a 5 November 1982 letter from Bennett, then District

Solicitor in Gisborne, to Witters, Rishworth & Wall. The minute was to the effect that the

Maori Trustee would pay full costs of an action against the estate of Harry Johnson,

'irrespective of outcome. ,200 The issue of the costs of the action taken against the estate of

Harry Johnson was to become a profoundly vexed issue?OI

In August 1984, Robert Chambers, an Auckland barrister, advised Woods that the District

Court did have jurisdiction in the matter. 202 In April 1985, however, Hovell told

Chambers that the value of the lost timber was about $50,000. Chambers saw this news as

'a bombshell' which, if true, meant that the proceedings should be transferred to the High

Court.203

At this point, the District Solicitor, Gisborne, put approximate damages recoverable at

$20,000 for loss of merchantable timber; $10,000 for stumping and regrassing the area

cleared; and $20,000 to clear drains.204 On 13 June 1985, the District Solicitor notified

Chambers that the proceedings had been transferred into the High Court on the grounds

196 Undertaking signed by R D Hovell, 17 April 1984, 181130/2 vo12 DB 197 Office Solicitor, Head Office, to Gisbome, 27 April 1984, 181130/2 vol 2 198 See also Coubrough, Office Solicitor, Head Office, to Gisbome, 18 June 1984, AA VN W3599 54/9/120 for quotation; also Coubrough to Gisbome, 16 August 1984, same file 199 T G Woods, District Solicitor, Gisbome, to Head Office, 23 August 1984, AA VN W3599 54/91120 200 Minute, initials illegible, District Solicitor, Gisbome, to Witters, Rishworth & Wall, 5 November 1982, 18/130/2 vol 2 DB 201 See sections 4.4.1.8, 5.1, 5.3, 5.5 202 Robert S Chambers to T G Woods, District Solicitor, Maori Affairs, Gisbome, 30 August 1984, 18/130/2 vo13, Maori Trustee, Gisbome Office 20J Chambers to District Solicitor, Gisbome, 30 April 1985, 181130/2 vol 3

55

that an important question of law was likely to arise. This was the question of the court's

jurisdiction to hear an application of reliet,205

4.4 The 1986 High Court Case

The District Solicitor, Gisbome, tried to get the matter dealt with as quickly as possible.206

The case was finally heard in 1986 by Justice Smellie at the High Court in Gisbome. The

court sat from 14 April to 18 April 1986, and then again from 28 July to 1 August 1986,

and on 4 August 1986?07

The judge heard a vast amount of widely varying evidence from an extensive array of

expert witnesses. Sections 4.4.1 and 4.4.2 indicate briefly what appear to be the most

significant points from a selection of the witnesses called. These sections draw both on

written briefs prepared by most witnesses, and on the testimony of these witnesses to the

Court. There are numerous spelling errors in the Transcript of the case. These should not

be taken as the responsibility of the witnesses quoted.

4.4.1 The Case for the Maori Trustee

4.4.1.1 The Evidence of David Eric McQueen

David McQueen had worked for the New Zealand Forest Service for thirty-one years.

Before he retired, he was the District Forest Ranger at Gisbome. He was qualified for,

and had many years of experience in, 'volume assessments of indigenous cut-over and

standing forests.' He had inspected Papatarata A2 on 23 September 1983 for the Maori

Trustee in order to establish the volume of native timber felled during a land clearing

operation on the block. He made his assessment of the area cut on the basis of:

1 Personal observation of remaining stumps and remnant trees 2 Aerial photographs

204 District Solicitor to Chambers, 16 May 1985, 18/130/2 vol 3 205 District Solicitor to Chambers, 13 June 1985, 18/130/2 vo13 206 Draft: T G Woods to Registrar, High Court, Gisbome, 18 July 1985; District Solicitor to Chambers, 15 November 1985; both in 18/130/2 vol 3 207 High Court, Gisbome, 'High Court Minute Book' [no years on spine, but page 1 is for 20 February 1985], folios 25-27; 37-40

56

3 Discussions with persons who were familiar with the bush 4 Records held by the NZ Forest Service and Lands and Survey

Departments.208

McQueen stated that, before it had been cleared, the bush had covered about 70 acres and

had 'contained a remnant of frequent kahikatea and rimu over tawa, pukatea, rewarewa,

puriri and large kanuka.' Along the stream banks there had been 'the odd totara and

matai' .209 He put the age of the kahikatea, rimu, tawa, totara, matai and puriri at between

40 and 80 years, and the age of the rewarewa and kanuka at up to 115 to 120 years.

By looking at five one acre sample plots, he had calculated that 560 trees of timber

quality had been felled. The majority of these had been rimu and kahikatea. There had

also been small numbers of tawa, pukatea and totara. McQueen considered that these trees

had been growing in optimal conditions at the time that they were felled. He considered

that it would have been prudent to harvest the trees in 'any year following 2026'. In 2026,

he thought that the rimu, kahikatea, totara and matai would have been two-thirds of the

way to maturity, and that the tawa would have been mature. He calculated that in 1982,

when they were felled, the timber volume of trees standing had been 925 cubic metres.

Had they survived until 2026, he calculated that they would have produced 2774 cubic

metres of timber. 21 0

McQueen told the Court that, had he been asked in 1980 whether 'this stand of trees

should be felled', he would have said that it was 'sacrelige'[sic].2lI It had been a 'clear

felling operation'. The wood had been dumped in muddled heaps.212 S T Crosby, Counsel

for the Defendant, questioned McQueen about differences between his assessment of

trees in the area cleared and that of Richardson, the defendant's expert witness. McQueen

208 'Forestry Brief, prepared by David Eric McQueen, inserted after p 29 in Transcript, High Court, Gisborne, Box: 'Al1185 Maori Trustee v Estate Harry Johnson Part file'. Quotation is from paragraph 4 of the brief. 209 Same Brief, paragraph 4 210 Same Brief, paragraphs 5-11 211 Transcript, p 13 212 Ibid, P 13

57

pointed out that Richardson had not made his assessment of the timber until 1986. This

would have made it much more difficult for Richardson to recognize the species that had

been felled.213

4.4.1.2 The Evidence of Robert Grubner

Grubner was a very experienced Forest Ranger for the New Zealand Forest Service in

Rotorua. He had visited Papatarata A2 on 3 April 1986 to quantify and to value the native

bush felled. On the basis of the market situation when the trees were felled in May 1982,

he put the value of the trees at $20 per cubic metre. On the basis of McQueen's figure of

925 cubic metres, he therefore valued the timber felled at $18,500.

Grubner considered, however, that a 'prudent forester' would not have harvested the trees

in 1982, and that 2026 would have been a suitable date. He considered that, had the trees

been felled when forty years older, their value per cubic metre in 1986 dollars would have

been up to $120 per cubic metre. On the basis of McQueen's figure of 2774 cubic metres

for 2026, and if the $120 price was used, this meant that in 2026 the trees would have

been worth $332,880 in 1986 prices?14 Grubner gave evidence that the percentage of risk

that there would not be 2774 metres of timber in about the year 2026 was 'no greater than

5 [per cent].' The transcript is somewhat unclear at this point. But the risks Grubner was

taking into account seem to have been fire and wind.2l5

Crosby tried to get Grubner to concede that clearing around the trees done in 1979 would

have slowed down their growth, and that consequently the 2774 cubic metre figure was

too high. Grubner conceded that the 1979 clearing could have affected the growth rate.

But he refused to make an alternative assessment, on the grounds that he did not have the

necessary information. 216

213 Transcript, p 16 [For name of Counsel for the Defendant, see Transcript, pI] 214 Written Brief, 'Evidence of Robert Grubner, Forest Ranger NZ Forest Service, Rotorua', inserted in Transcript after p 31 215 Transcript, p 35

58

4.4.1.3 The Evidence of Graham Robert Driver

Up to 1 March 1986, Driver had been a Soil Conservator, the officer in charge of the

Ruatoria Office of the East Coast Catchment Board. Driver had inspected the block six

times between 18 November 1983 and 11 November 1985. His brief of evidence

indicated that by November 1983, about 1330 metres of waterways on Papatarata A2 had

been obstructed by earthworks or vegetation. They were still obstructed in November

1985. He considered that these obstructions created a serious risk of erosion.

He estimated that it would cost about $16,662 to clear the various watercourses. The

removal of the original manuka cover meant that it would also be necessary to plant

poplar and willow poles for erosion control. He estimated that this would cost a further

$4480. Driver stated that the three month period given in the section 118 notice for

clearance of the waterways was a reasonable period.217

Driver told the Court that the East Coast Catchment Board had powers to deal with the

waterways under both the Soil Conservation and Rivers Control Act 1941 and the Water

and Soil Conservation Act 1967. The board had not yet exercised its powers because it

was waiting for the outcome of the High Court case.218

Crosby put it to Driver that where there was major clearing on a farm, some problems

related to waterways were inevitable. Not only did Driver disagree with this proposition,

he even went so far as to state that this was 'the most extreme case' he had ever seen?19

Driver also told the Court that Papatarata A2 was 'a very good block'. With appropriate

development and erosion control measures, he could not see any problem with farming

the block 'adequately' ?20

4.4.1.4 The Evidence of Raymond De Berdt Hovell

216 Transcript, pp 44 - 47 217 Written Brief of evidence by G R Driver, 'Papatarata A2 Block', inserted in Transcript after p 79 21B Transcript, pp 58 - 59 219 Transcript, p 61

59

· Hovell gave evidence that felling of native trees on the block had been carried out in two

stages. Some native trees were felled in 1979. Hovell said that this was done as a result of

root raking by a bulldozer. Consequently the trees affected were those small enough to be

knocked over by a bulldozer. He stated that he was horrified and had immediately

complained.

In August 1982, he had visited Papatarata A2 and found that 'all remaining species of

larger trees had been chopped down, some felled into lengths and others pushed on top of

the debris already in the watercourses.' On this occasion, chainsaws had apparently been

used, and the trees felled were generally bigger. Hovell said that this work had been done

since his last visit to the block, which he thought had taken place in February 1982.221

The claimant was open about his frequently expressed desire to have an opportunity to

lease Papatarata A2 so that he could farm it himself. He said that his brother sti111ived in

Te Araroa and farmed his father's adjoining property, Pipituangi. He said that the latter

block was 'all cleared and grassed and fenced and subdivided. ,222 He wanted to see

Papatarata A2 developed in the same way.223

4.4.1.5 The Evidence of Brian Courtenay Cox

Brian Cox stated that he was a registered surveyor from Grant & Cooke, a Gisbome

survey and land development consultancy practice. He had 34 years of experience as a

surveyor in the Gisbome district. He had surveyed Papatarata A2 in 1980, 1981, 1982 and

1983, and inspected it in 1983 and 1985?24

220 Transcript, p 71 221 Transcript, p 83 222 Transcript, p 85 223 Transcript, p 89 224 P 1 of Written Brief of evidence by Brian Courtenay Cox, inserted in Transcript after p 99; See also section 3.3

60

He produced four maps for the Court. Figures 1 to 4 in this report are based on these

maps.225 Figure 1 showed boundary fencing, land areas apparently cleared and grassed,

and native bush areas as at the time of the 2 December 1974 deed. To prepare this map,

Cox used aerial photographs taken in September 1971 and December 1976. There was

little difference between these two photographs, other than an apparently slightly greater

area of man uk a in the 1976 photograph.

The other three maps were prepared on the basis of Cox's surveys and inspections.

Figure 2 showed the block as at June 1981. It made clear what additional boundary

fencing had taken place between 1974 and 1981, and which areas had been cleared or

cleared and grassed. It showed the area on which native bush had been recently felled. It

is clear that a considerable amount of the native bush was felled between 1974 and 1981.

Figure 3 showed Papatarata A2 as at July 1983. It indicated the extent of new fencing,

clearing and grassing, and the extent of native bush at that time. Again, this map showed

that considerable further felling had taken place.

Figure 4 showed Papatarata A 2 as at November 1985. 226 The hatching on this map

seems to have been put on by the next witness, Gordon Kelso.227

4.4.1.6 The Evidence of Gordon Hunter Kelso

Gordon Hunter Kelso held a Diploma in Agriculture and a Diploma in Land Valuation

and Farm Management from Lincoln College. He was a registered valuer and farm

management consultant.228

The Written Brief of Kelso's evidence is missing from the High Court transcript in

Gisborne. A letter with the address crossed out, re-headed as 'EVIDENCE OF GORDON

225 Maps 1 to 4 are Exhibit 7 in the High Court action. 226 P 2 of same Written Brief 227 Transcript, p 108 228 Transcript, p 108

61

'i

HUNTER KELSO' appears in the loose papers of Counsel for the Maori Trustee. It

seems from the Transcript, however, that the final written report provided by Kelso was

much fuller than this four page document. 229 The absence of a copy of the Written Brief

makes Kelso's evidence difficult to follow.

Crosby, Counsel for the defendant, cross-examined the witness rigorously about the

amount of clearing and fencing that had been done.230 The witness agreed to a suggestion

of Crosby's that under 1986 pastoral farming conditions and economics, this was 'very

marginal country for development purposes' ?31

Crosby also took up with Kelso the issue of the correct risk percentage to be used in

calculating the value of the native timber felled on the block. Crosby argued that factors

such as possible changes to local authority regulations regarding the harvesting of native

timber should be taken into account in setting a risk percentage for calculating the present

value of the trees felled on the block. The witness admitted that there were risks over and

above fire and wind. But he was non-committal about suggesting a risk percentage other

than the five per cent put forward by the witness Grubner.232

4.4.1.7 The Evidence of John Richard Preece

Preece was employed as Park Foreperson for the Gisbome Reserves Section of the

Department of Lands and Survey. He had a BSc in Zoology from the University of

Canterbury. This included a third year paper in Ecology.233

Preece gave evidence that the Pukeamaru Scenic Reserve adjoining Papatarata A2 was a

very important reserve. The presence of animals such as cattle could cause major damage

229 Loose papers of Chambers, Counsel for the Maori Trustee, now held by the Maori Trustee, and viewed by the writer. The evidence is in the form of a letter to Rishworth Wall & Mathieson. The address and date have been crossed out, and the words EVIDENCE OF GORDON HUNTER KELSO have been written in alongside the crossed-out address. 230 For instance, Transcript, pp 121 - 124 (Fencing); 124 - 126 (Clearing) 231 Transcript, p 114 232 Transcript, pp 118 - 120 233 Transcript, p 144

62

to such a reserve.234 He reported seeing evidence on three occasions of the presence of

cattle in the reserve in the area by Papatarata A2.235 He stated fencing the reserve was an

urgent matter. But his department had not exercised its powers under the Reserves Act or

the Fencing Act with regard to having the boundary between Papatarata A2 and the

reserve fenced because they had been waiting for the outcome of this case.236

4.4.1.8 The Evidence of Arnold Julius Ferris

From December 1984 up to the time of this case in 1986, Ferris was the Director of the

Maori Affairs Department in Gisborne. He was also the local delegate for the Maori

Trustee.237 From September 1979 to February 1983, he had been the Assistant District

Officer in Gisborne. Over this period, he had also had delegated authority to act for the

Maori Trustee. Ferris gave evidence that he had visited Papatarata A2 on 8 September

1982, and seen 'quite a large stack of logs there of native trees', and drains filled with

logs and branches. As a result of this, he said, he had returned to the Gisborne Office and

ordered that a Property Law Notice be served on the lessee.238

Counsel for the Maori Trustee raised with him an allegation that had been made by the

defendant in the case that McCreadie 'by his conduct acquiesced in the felling of some

trees on the block in 1979 and 1980.'239 Ferris testified that the lowest level at which an

officer had power to sign under seal on behalf of the Maori Trustee was the Assistant

District Officer level. Chambers continued:

Prior to the allegation being made against Mr McCreadie earlier this week had you heard anything about his having consented or acquiesced in the felling of native trees on [Papatarata] A2 ... No I had not heard of any [suggestion] that he had done that, further to that he had not got any authority from our office either in writing or orally to do that if he did do it Simply [because] we [don't] have that authority

234 Transcript, pp 144 - 145 235 Ibid, P 145 236 Ibid, P 146 237 Ibid, pp 151 - 152 238 Ibid, pp 152 - 153 239 Ibid, P 154

63

Do you have authority as the Maori Trustee in Gisborne to give such consent .... I [don't] have the authority as the Maori Trustee in Gisborne to give consent to the felling of timber on any Maori property.240

In answer to a further question, Ferris stated that if Maori landowners who had the Maori

Trustee as agent wished to fell timber on their land, then they would have to apply for and

obtain the consent of the Maori Land Court. He said that restrictions on the powers of

Maori Affairs officers regarding the felling of native timber were 'very widely known by

officers working in those [particular] fields of activity. ,241

As regards the issue of costs, Ferris was asked to look at the November 1982 letter and

the minute referred to in section 4.3. Chambers then said to him:

Now having refreshed yr mind from [reading] that, what attitude did u form as to who should pay the costs of the legal proceedings to be brought against the Def. in this case. My attitude the M. Trustee should pay full costs, irrespective of outcome at the time?42

4.4.1.9 The Evidence of John Carlaw Hagen

John Hagen was a partner in the international accounting firm, Deloitte Haskins-Sells. He

had a Masters of Business Administration degree from the University of British

Columbia, Canada, as well as a Master of Commerce degree with first class honours from

Auckland University. He was an Associate Chartered Accountant and a member of the

New Zealand Society of Accountants. Much of his work involved business valuations and

the settlement of disputes about valuations?43 His evidence was very significant in this

case.

Hagen used figures previously presented by two earlier expert witnesses. McQueen had

estimated that if the trees felled had been left until 2026 before harvest, there would have

240 Ibid, P 154 241 Ibid, P 154 Note that pp 170 - 179 of the Transcript were used by the Judge for taking notes. Consequently the writer did not have access to them. 242 Transcript, p 202. There is a further reference to the matter of costs on p 203. 243 Short Resume John Carlaw Hagen. Short Resume and Written Evidence of Hagen are not included in the High Court Transcript of the case. A copy of these two documents was supplied to the writer by the Claimant. DB

64

been 2774 cubic metres of timber. 244 Grubner testified that, had the trees been left to that

point, the timber would have been more valuable than it was at the time it was felled in

1982. He suggested a price of up to $120 per cubic metre in 1986 dollars. Taking the

$120 price, the timber would have been worth $332,880 in 2026 in 1986 dollars. Grubner

had also suggested a risk factor of no more than 5 per cent.245

Hagen based the first part of his report on prices in 1986 dollars. He took the $332,880

figure for 2026 in 1986 dollars. Then he adjusted this figure for various possible

percentage levels of risk that the trees would not have been harvested in 2026, had they

been left standing in 1982. The percentages ranged from 5 per cent through to 50 per cent.

By adjusting the $332,880 in this way, he obtained a 'Certainty Equivalent' that took out

the risk factor. The 'Certainty Equivalent' ranged from $316,236 for a risk factor of 5 per

cent through to $166,440 for a risk factor of 50 per cent. 246

These figures, however, represented the hypothetical certainty value of the felled trees in

2026. To obtain the present value of the 2026 value of the trees, Hagen used a discount

rate. Again, he chose to look for a rate that removed the effects of inflation, that is to say,

a real rather than a nominal rate. In his report, he surveyed the relevant literature and

decided cases?47 On the basis of this, he adopted a 3 per cent rate. He then adjusted the

2026 certainty equivalent figures by this 3 per cent discount rate to arrive at a range of

1986 present values. Using the 3 per cent discount rate, the $316,236 figure for 2026

represented $96,944.30 in 1986. At the other end of the risk factor range, the $166,440

figure for 2026 represented $51,023.32 in 1986. This then effectively provided a range of

possible values that could be put on the timber felled by the lessee in 1982 had it still

existed in 1986.

244 See Section 4.4.1.1 245 See Section 4.4.1.2 246 Evidence of John Carlaw Hagen, p 1 DB 247 Evidence of John Carlaw Hagen, pp 2 - 3 DB

65

In the latter part of the report, Hagen refers to inflation. To illustrate the effects of

inflation, he gives both a table and a graph showing the effect of various interest rates on

$332,880 over a forty year period. He gives the example that '$332,880 in 1986 dollars is

the same as $15,065,900 in 40 years time assuming an inflation rate of 10 per cent per

annum.' It should be noted, however, that Hagen made it clear to the court that if the rate

of inflation had been taken into account in calculating the value of the trees in 2026, then

this rate would also have had to be incorporated in the discount rate. The figures of over

fifteen million dollars therefore sounds dramatic, but did not affect the estimates that

Hagen was giving of the 1986 value of the trees felled in 1982?48

4.4.2 The Case for the Defendant

4.4.2.1 The Evidence of Richard Harold Twistleton

Richard Twistleton was a company director. He had grown up in Motu, halfway between

Gisbome and Opotiki. His father and brothers were bushmen. His involvement in the

logging of native trees went back thirty-five years?49 Twistleton's written report said that

the fallen trees he saw on Papatarata A2 in 1982 had no commercial value?50 He said that

his 'overall impression' was that if the trees had remained on the block undisturbed, 'they

would have become millable in a minimum of 100 years. They would not have been

millable by the year 2026. ,251

Under cross-examination, however, the witness conceded that he had taken no notes on

the visit that he recollected having made to the block in 1982.252 Twistleton also said that

his expert knowledge of native timber prices reflected the 1980-1981 period, rather than

subsequent years. Over the previous ten years, moreover, he thought that about one per

cent of the timber his company had been marketing had been native timber. 253

248 Transcript, p 183 249 pI of what appears to be the written evidence of Richard Harold Twis1eton is filed in 181130/2 vo13 [p 2 of evidence omitted], Maori Trustee, Gisbome Office 250 written evidence, p 3 251 Written Evidence, pp 3 - 4 252 Transcript, p 205 253 Transcript, p 212

66

4.4.2.2 The Evidence of Athol Nolan Richardson

Richardson had left school at thirteen.254 He stated that he had first worked in the bush

when he was 16, and had fifty years of subsequent experience. During that time, he had

set up three companies involved with various aspects of the felling, milling, retailing and

transport oflogs and timber. 255

Richardson had inspected Papatarata A2 in October 1985 and Aprill986. On the second

visit, he had made a detailed count of stumpS.256 He considered that 'the value of the

native timber on the three areas which we inspected and cruised ... would be nil. ,257 He

said that potentially millable trees on the block might have been millable in 100 years

time.258 Richardson assessed the possible value of the trees in 2026 at $10,500 in 1986

dollars, before any allowance for risk.259 He put the risk at far above 5 per cene60

Under cross-examination, Richardson admitted that McQueen, viewing the block in 1983,

had been in a better position to identify species felled than he had been in 1986.261

Moreover, he became at times somewhat confused. When asked to show the basis of his

calculations about the timber felled, he stated that his notes were 'Probably destroyed,

they didn't mean anything. ,262 Later, however, he referred to calculations that he had

made 'In my head', on the basis of experience rather than any relevant literature.263

After he had reported that he would not have been interested in buying timber on the

block, and then being shown by Counsel for the Maori Trustee a letter from his company

254 Transcript, p 222 255 Written Evidence of Athol Nolan Richardson (inserted at end of Transcript), pp 1 - 2 256 Ibid, pp 3 - 4 257 Ibid, P 8 258 Ibid, P 8 259 Ibid, p 10 260 Ibid, P 11. The writer fInds it diffIcult to understand what he saw as the total risk percentage. He mentions various fIgures up to 80 per cent. 261 Transcript, p 224 262 Transcript, p 225 263 Transcript, p 233

67

offering to purchase the timber, he said that he had been seriously ill in 1982?64 When it

became difficult to resolve the issue of the influence that Twistleton's evidence had had

on his own, the judge asked Richardson whether he had read Twistleton's report.

Richardson responded 'I [don't] know, 1m not sure, I have seen his evdce.'

4.4.2.3 The Evidence of John Francis McElhinney

McElhinney had a Diploma in Agriculture and a Diploma in Land Valuation and Farm

Management from Lincoln College. He was also an Associate of the Real Estate Institute

of New Zealand. He had worked in the Gisbome area from 1974 to 1985 for Williams &

Kettle Ltd, for Dalgety Crown Ltd, and on a self-employed basis'. He had been involved

in land valuation and in farm supervision and farm sales.

McElhinney had inspected Papatarata A2 twice in July 1983, and in November 1985. 265

He argued that the boundary fencing was adequate from a farm management point of

view, and that there was 'no sensible reason' to fence the Pukeamaru reserve?66 He

conceded that there was more land that could be cleared, but he argued that, on the

grounds of economics, a 'prudent farmer' would not clear any more of the property?67 He

also stated that, 'although not pretending to be an expert on the subject', debris in two

watercourses on Papatarata A2 did not seem to be blocking the flow ofwater.268

Two points in his evidence in court are of particular interest. At one point, he was asked

about an obstruction that had been pushed into a creek on the block to provide a vehicle

crossing?69 He described it as 'quite a normal farming practise'(sic), as 'the approved way

acording to best farming practise for creating crssing'(sic) and as an 'Acceptable way but

if one was doing it look nice one would use concrete culvert'(sic). The judge sought

clarification:

264 Transcript, p 226 - 227 265 PI of Written Evidence of John Francis McElhinney, located at the very end of the Transcript 266 Pp 2-5 of Written Evidence of John Francis McElhinney 267 Pp 5 - 7 of Written Evidence of John Francis McElhinney 268 Pp 9 - 10 of Written Evidence ofJohn Francis McElhinney 269 Transcript, p 248

68

BENCH: Would u do it that way if lease said once a yr u would have to ... clear all waterways and ... 1m sure fine letter of law in lease documents is not strictly not adhered to in many cases of this type of country. Assume words mean what they say would u have done it like that. NO.270 [sic]

Under examination by Crosby, Counsel for the defendant, he made some comments that

reflect on the way in which Maori Trustee leases were administered:

[CROSBY : ] ... u indicated tht you had had some considerable expo in completing rural bank loan application for lessess of lands administered by M.Trustee have u had some considerable expo in inspecting blks of land which administered by M.Trustee. Yes. From those pblks u have inspected including the Pak.A2Blk how would u rate the management of the PakA2 Blk compared to those otehr blks u have inspected, farm management and practises. I would say the farm mangagement on Pale. would be better than average for Maori land, Maori lease land it would be better than average. From what u know of thse blks if u were asked to compare the extent to which a lessee of M.freehold lands admin. by M.Trustee the extend to which a lessee had carried out his obligations as u ustood them in respect of the leases, how would u rate the lessess of the Pak.A2 Blk compared to others. I would say they had made a better than average attempt to comply with the lease, I have seen leases that have got the same clauses, clearing, fencing, where I dount any scrub has bn cut, I think they have made a genuine attempt to comply. U have indicated tht they may not have cleared the land or carried out the farming in way tht u might have done, but is there manner of doing this bn irresponsible or what. I dont describe as irresponsible, the improvement I would have made in conjunction is I would carry out more internal dev. to control land cleared and eliminate some risk of regrowth, there werent any Govt systems to assist them in that.271 [sic]

The answers of this witness appear to suggest that the average lessee with a Maori

Trustee lease failed to meet the terms of the lease. The lessee in this case had not farmed

in the way that McElhinney might have done, but the witness was prepared to defend the

lessee on the grounds that 'a genuine attempt to comply' had been made. Given the

eleven years of experience that McElhinney had had in the East Coast area, this raises

questions about the extent to which the Maori Trustee had been enforcing the terms of

leases in this significant region.

270 Transcript, p 249 271 Transcript, p 253

69

4.4.3 Adjournment of the Case Sine Die

McElhinney gave evidence on Friday 1 August. On Monday 4 August, Justice Smellie

saw Counsel in Chambers. He suggested that the proceedings should be settled. After

some hours, Chambers advised Justice Smellie that a settlement had been reached. He

asked that the proceedings be adjourned sine die to be brought on at three weeks notice.

Chambers also asked for an order for payment to the plaintiff of monies held in Court.

The judge ordered the adjournment, and also ordered the payment of $4197.60.272

4.5 Conclusion

Once officials from the Gisbome Office of the Maori Trustee had witnessed the scale of

felling of native trees that had taken place on Papatarata A2, there seems to have been a

significantly greater commitment by the Gisbome Office to taking legal action against the

lessee. Unfortunately, however, when the matter came before the District Court again in

July 1983, a technicality once more led the solicitor Witters to elect to be non-suited.

On the other hand, the delay in hearing the case seems to have enabled the collection of

further information about the value of damage done to the block. As a result, the action

was transferred to the High Court. Some matters, such as damage to the neighbouring

scenic reserve, were not readily quantifiable. The evidence given by Graham Driver

before the High Court in 1986, however, suggested that damage done to various

waterways would cost more than $21,000 to rectify.

272 High Court, Gisbome, 'High Court Minute Book' [no years on spine, but page 1 is for 20 February 1985], folio 40; High Court, Gisbome, 'ACTIONS REGISTER 1983-1985[or 1986]" folio 62 There was later to be some dispute as to whether the $4197.60 represented rent from the lease or part of the settlement. See DATES ON WHICH RENT OR MESNE PROFITS HAVE BEEN RECEIVED SINCE 1 JANUARY 1977, P 50 of Exhibit 1, High Court, Gisbome. The bottom of this page shows $4,197.60 as the 'Sum now owing on account of mesne profits'. ['Mesne profits' according to The Concise Oxford Dictionary (7th ed) are 'received from estate by tenant between two dates. All but two of the entries on this page, however, relate to rent due and received.] For treatment of this amount as part of the settlement, and subsequent dispute about this, see T G Woods to Wilson, Barber & Co., 5 November 1986;

70

Furthermore, there was also expert evidence for the Maori Trustee that the value of the

trees on the block, had they been left until 2026, would have been up to $332,880 in 1986

dollars. This was before allowing for any risk factor. Using a 3 per cent discount rate and

allowing for a range of risk factors, $332,880 in 2026 represented a range of sums in

1986, from $96,944.30 for the 5 per cent risk factor mentioned by a witness for the

plaintiff, through to $51,023.32 for a 50 per cent risk factor.

This was over and above any damages related to areas of the block that had been

inadequately fenced, cleared, grassed and topdressed. The absence of the written brief of

the valuer, Kelso, is unhelpful here.

Counsel for the defendant called two witnesses who sought to establish that the value of

the trees was far lower than witnesses for the plaintiff had argued. But one of these

witnesses admitted to having taken no notes on his 1982 visit to the block, and to minimal

experience of marketing native timber in the previous ten years. The other became

confused when asked about his calculations and the influence of the other forestry witness

upon his testimony.

A final witness called by the defence does not seem to have set out to argue that the block

had been well farmed. Instead, he claimed that the lessee had made a better than average

attempt to comply with the covenants in the lease in comparison with other lessees of

Maori lands administered by the Maori Trustee.

It must be emphasised that Justice Smellie never gave a decision in this case.

Nevertheless, it seems not altogether surprising that, as we shall see in the next chapter,

Chambers, Counsel for the Maori Trustee in 1986, apparently thought that, if the matter

? illegible to Mrs South re Rent Arrears Est H Johnson Lessee Account ... , fol 1206, both in IS/130/2 vol 3 Maori Trustee, Gisborne Office

71

i had gone on for judgment, the damages would have been well above the $27,500 figure in

the 1986 settlement.273

The evidence given for the defendant that related to the performance of lessees with

leases administered by the Maori Trustee again raised a question about the adequacy of

the manner in which such leases were being handled.

273 See section 5.5

72

CHAPTER 5: THE SEARCH FOR A SETTLEMENT

This chapter firstly mentions the settlement made on 4 August 1986. It then moves to

initial negotiations about the possible leasing of the block to Hovell.

Next, it looks at the prolonged and vexed negotiations about the distribution of legal costs

between Hovell, owners of Papatarata A2 as a group, and the Maori Trustee. A settlement

of this issue seems to have been reached only in 1993. At that point, however, the

solicitor for the claimant made it clear that he regarded the 1993 settlement as a

settlement only of the issue of Hovell' s legal costs.

5.1 The Settlement of 4 August 1986

A File Note made by the claimant's solicitor, P A F Wall, gives his view of the settlement

of 4 August 1986.

Basically after the matter was settled which was at some stage on the 4th August 1986 I went to Court on that day and spent about 45 minutes talking about settlement proposals. Since then I have had a couple of discussions with Sandy Hovell and also with Torn Woods. As far as I can see the terms of settlement was that there was $27,500.00 agreed to be paid plus the land back. Time was of the essence. Balance funds to be paid in November. Some funds, about $5,000.00 paid and the funds held at Court. There will be security over freehold lands for the balance. Maori Affairs to meet legal expenses, Sandy to get the balance over and above expenses. Maori Affairs have paid about $13,000 to date. Have to consider options before they made this offer and basically Torn Woods tells me if they had forced the bankruptcy of the estate they would just have to stand in line behind the secured creditors and get nothing so it seemed to be the best way of settlement.274

This interpretation of the rationale behind the level of the settlement is confirmed by a

letter from Woods, the District Solicitor, to Burnard, Bull & Co, in which he stated that

the Maori Trustee had agreed to settle for this sum:

only because of the representations made by your client on Monday as to the near bankrupt state of the estate.275

274 File Note 'HOVELL: 11 August 1986', supplied by Counsel for the Claimant (R T Hovell) DB 275 T G Woods to Burnard, Bull & Co, 5 August 1986, fol1132, 18/130/2 vol 3, Maori Trustee, Gisborne Office DB

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The District Solicitor told Burnard, Bull & Co that the Maori Trustee would insist on

strict compliance with the terms of the settlement. He said that the Maori Trustee would

'not hesitate to bring on the adjourned proceeding for hearing again and to obtain

judgment upon it.' 276

By 5 November 1986, however, the defendant had still not paid the sum of $27,500,

reduced by the above-mentioned sum of $4197.277 The Maori Trustee did not, however, at

this or any later stage, bring on the adjourned proceedings.

5.2 Initial Negotiations over Papatarata A2

In the meantime, Hovell had begun negotiations with the Maori Trustee over the future of

Papatarata A2 and over the issue of settlement of costs that he had paid to enable legal

proceedings to take place.

On 19 November 1986, the Maori Trustee wrote to all owners in Papatarata A2 whose

addresses were known, to inform them about a meeting of owners to discuss, firstly, the

matter of the fencing off of the block from the Pukeamaru Scenic Reserve. Secondly, the

meeting was to discuss 'whether the Maori Land Court should be asked to appoint the

Maori Trustee as trustee of the land.'278

Section 438 (1) of the Maori Affairs Act 1953 permitted the Maori Land Court to make

an order vesting Maori land in any trustee or trustees. Section 438(2) permitted the Maori

Trustee (or any other person or persons) to be appointed a trustee under section 438.

Butterworth and Butterworth note that such trusts gained popularity because their

structure was 'somewhat less formal and cumbersome than an incorporation. ,279

276 T G Woods to Burnard, Bull & Co, 5 August 1986, 181130/2 vol 3 DB 277 T G Woods to Wilson, Barber & Co, 5 November 1986, foll155, 181130/2 vol 3 278 Copy of letter to owners, J Leach for Registrar, to 'Dear SirlMadam', 19 November 1986, foll163 in 181130/2 vol 3, Maori Trustee, Gisborne Office 279 Butterworth & Butterworth, op cit, p 106

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Owners were told that, should the court made a vesting order for the block under the

standard form of trust order,

the Maori Trustee would have no power to sell the land. He would, however, have power to agree to the taking of the land required for an essential work under the Public Works Act. The standard trust order provides that except for one long term of lease, the Maori Trustee may not lease the land for longer than 5 years at a time.

The proposal in this case is for the Maori Trustee to lease the land to Mr S Hovell who himself is an owner of the land for a term of 10 years with a further right to renew the lease for another 10 years?80

On 8 December 1986, the meeting of owners was held at the Maori Land Courthouse in

Gisborne. The only owners present, in addition to Sandy Hovell, who at that point owned

1066.091 shares in the block, were Emma Hoyle and Zena Parkinson, each of whom

owned 9.051 shares. The total shares of those present therefore totalled just slightly more

than half ofthe total of2155 shares in the block.

Both women were ignorant as to why they had not received rent from the block for a

prolonged period. Emma Hoyle and her sister wanted to keep their interests in the block.

The owners present agreed to idea of the setting up of a section 438 trust and to the

leasing of the block to Hovell in the terms mentioned in the notification letter.281

A section 438(2) order was apparently made in the Maori Land Court on Tuesday 5

February 1987. But according to Sandy Hovell's solicitor, agreement on the 'term and

rental' were yet to be reached at that time?82

280 Copy ofletler to owners, J Leach for Registrar ... , 19 November 1986, 181130/2 vol 3 281 Minutes of Meeting of Owners for Papatarata A2 ... 8 December 1986 ... , 18/130/2 vol 3, Maori Trustee, Gisbome Office; For total shares, see Schedule of Ownership Orders, Certified as true and correct ... 20 April 1982, 18/130/2 vol 4, Maori Trustee, Gisbome Office 282 Rishworth, Wall & Mathieson (P A F Wall) to Ferris, Maori Affairs, Gisbome, 11 February 1987, AA VN W3599 54/91120, NA Wellington

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5.3 Initial Negotiations about the Issue of Legal Costs

As noted in section 3.2, the Maori Trustee asked Witters, Hovell's solicitor, to act on

behalf of the Maori Trustee in the action against the lessee in the Magistrate's Court on

the understanding that Hovell would meet the costs of the action. Sections 4.3 and 4.4.1.8

have indicated, however, that some ambiguity surrounded the situation regarding later

legal costs.

Despite this, at the time of the 1986 High Court case, Hovell and his solicitor understood

that the Maori Trustee would pay legal expenses. This is clear from the solicitor's File

Note quoted in section 5.1.

In March 1987, P A F Wall was still trying to arrive at a settlement with the Ferris of the

Department of Maori Affairs over the issue of the legal costs paid by the claimant. He

sent a copy of his 11 August 1986 File Note to Ferris, along with a letter in which he

stated that:

During [the settlement discussions on 4 August 1986] the writer had discussions with Mr. Woods and Mr. Woods advised the writer on behalf of our client Mr. Sandy Hovell that Maori Affairs would meet legal expenses.

This was an important matter as far as our advising Mr. Hovell to agree with the terms of settlement although we appreciate that he was not the plaintiff in the matter and that it was really for the Maori Trustee to accept the terms of settlement.

During the Court hearing we had been requested to provide a schedule of all expenditure to Dr. Chambers and Mr. Woods and we did that. That showed that the total amount spent up until that time by Mr. Hovell was $27,873.48.

We are also aware of various discussions which took place throughout the hearing and in all those discussions it was agreed that the Maori Trustee would be meeting Mr. Hovell's expenses. Whether these are all Mr. Hovell's expenses or part ofMr. Hovell's expenses is not particularly clear but what is clear is that the Maori Trustee agreed to reimburse Mr. Hovell.

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There appears to be no conditions attached to that offer of reimbursement. 283

In a slightly earlier letter, Wall conceded that there were practical problems involved in

the complete refunding of the claimant's costs, although he continued to insist that

Woods had made no conditions in his statements:

We are aware that at the stage Mr. Woods made these comments it was anticipated that damages in the region of $100,000.00 to $150,000.00 would be paid by the defendants and that in the final outcome damages of only $27,500.00 were agreed upon. While we [accept] that that [changes the] situation as far as your Department is concerned when Mr. Woods advised that expenses would be repaid he did not have any qualification or conditions attached to that offer in that he did not state that if damages were only in a minimal amount the expenses would not be refunded.284

Despite the high level of costs incurred by Hovell, the Maori Trustee had also incurred

significant costs on behalf of the block. As a result of these, the block account from

Papatarata A2 went substantially into overdraft. Between 23 June 1982 and 16 July 1987,

charges or payments of $47,620.51 were made against the block account. The most

substantial sums involved were legal fees of $10,995 and $10,910; solicitor's fees of

$4300; one payment of $3669.61 in connection with surveying; and $3408.55 in interest

on the overdraft.

Over against this, there were payments received totalling $14,179.41. These included

$1353.75 royalties from the sale of logs; $3148.20 in rent; $5455.46, representing half of

one of the bills for legal costs; and the $4197 payment towards the High Court damages.

This left the block with a total overdraft of $33,441.10 at 16 July 1987?85 This was a

period of very high interest rates.286

283 Rishworth, Wall & Mathieson (P A F Wall) to Department of Maori Affairs (J Ferris), 16 March 1987, copy of letter supplied by Counsel for the Claimant DB 284 Rishworth, Wall & Mathieson (P A F Wall) to Ferris, Maori Affairs, Gisbome, 11 February 1987, AA VN W3599 54/9/120, NA Wellington DB 285 Sheet headed ESTATE TRUST of Papa tarat a A2 from 23.6.82 to 16.7.87, fol1208 in 181130/2 vol 3, Maori Trustee, Gisbome Office DB

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The 'enormous' debt level brought about by legal expenses was a matter of concern to

Maori Trust office staff. One commented that 'Legal costs incurred represent

approximately 1/3 of the capital value of the land' .287

Complicated negotiations took place between the claimant and his solicitor; T Woods, the

District Solicitor in Gisborne who moved to Rotorua during the negotiations; and staff at

the Gisborne and Head Offices of the Maori Trustee. Hoven sought to negotiate some sort

of arrangement that would facilitate his efforts to lease and farm Papatarata A2.288

Section 3.3 ends with a quotation from the section of Richard Wickens's memorandum

dated 31 July 1987 and written for the Maori Trustee about the Papatarata A2 situation.

This quotation is from the section of the memorandum related to the differing reports of

McCreadie and the expert witness produced by Hoven for the 1980 District Court case.

In view of the efforts of staff of the Maori Trustee to achieve a settlement with Hoven

that was considerably short of meeting the expenses Hoven had incurred over the various

court cases, it is interesting to note some of the other comments made by Wickens in this

memorandum. He went on from stating that he believed that, had McCreadie made an

accurate report on the block, the first case would have been won, to say that this would

have had the effect of:

2B6 For example, on 26 June 1987, the normal rate for a loan from the Maori Trustee was apparently 21 per cent. T Woods (Rotorua) to Gisbome, 26 June 1987, 18/130/2 vol 3, Maori Trustee, Gisbome Office. 2B7 R T Wickens for Maori Trustee to Rimu Pohatu, Gisbome, 7 August 1987, 18/130/2 vol 3 2BB T G Woods to Rishworth, Wall & Mathieson, 14 August 1986; A J Ferris (Director, Maori Affairs, Gisbome) to T G Woods (Rotorua), 12 May 1987; Rishworth, Wall & Mathieson to J Ferris, Gisbome, 12 May 1987; T Wood (District Solicitor, Rotorua) to Director, Gisbome, 26 June 1987; R K Pohatu for Maori Trustee, Gisbome, to R Wickens, Head Office, 10 July 1987; Memorandum Rimu [Pohatu] to R Wickens, undated, fol1213(b); Minute: Telephone Interview Notes Richard Wickens - Papatarata Elk., 6 June 1987, illegible signature, fol1214; R T Wickens for Maori Trustee to Rimu Pohatu, Gisbome, 7 August 1987; Draft Agreement re Papatarata A2, by B Tupara, District Solicitor, fol 1217; All in 18/130/2 vol 3, Maori Trustee, Gisbome Office.

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eliminating any need for a fresh action to have been brought. I base this assumption on the fact that evidence obtained by Hovell contributed to the success of the second case.

To be fair, I therefore believe the costs of the first case ought to be a charge against all the owners, and the Maori Trustee should bear all the costs of the second case on the grounds that it should not have been necessary.289

Later in the memorandum, he begins a proposal about a possible settlement with the

words 'If we accept that the Maori Trustee's own negligence (perhaps not the right word)

was responsible for the second case'.

Yet despite apparently admitting that it was the inaccurate reporting of an employee

acting for the Maori Trustee that had resulted in the need for a second case, and stating

that he believed that the Maori Trustee should bear 'all the costs of the second

case'(emphasis added), Wickens still expressed 'reservations' as to whether all Hovell's

legal expenses were necessary and went on to put forward a solution that was far from

meeting Hovell's legal expenses. 290

In August 1987, Hovell was offered an arrangement that seems to have been valued by

Maori Trustee staff at $10,000, plus the amount of any special administration fee

foregone by the Maori Trustee. 291

Yet, as mentioned earlier in this section, the total amount of costs paid by Hovell as stated

in the High Court case was $27,873. Of this sum, $2243.16 was paid by Hovell before or

on 17 April 1980, and thus presumably relates to the first case, heard in the District

Court. It should also been borne in mind that these figures did not cover any fees or

expenses incurred from 28 July 1986, and that several bills were anticipated at that point.

Moreover, this arrangement also apparently left the block account bearing the $13,816

289 Richard Wickens to Robinson, 31 July 1987, AA VN W3599 54/91120, NA Wellington DB 290 Richard Wickens to Robinson, 31 July 1987, AAVN W3599 54/91120 DB 291 R T Wickens for Maori Trustee to Rirnu Pohatu, 7 August 1987, AA VN W3599 54/9/120

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costs that had been paid by the Maori Trustee.292 Thus this settlement left both the block

account and Hovell with heavy losses because of a case that a senior member of the staff

of the Maori Trustee conceded should not have been necessary. Hovell rejected this

settlement. 293

5.4 Payment following the Settlement of 4 August 1986

While these negotiations were in progress, the outstanding sum that the estate of Harry

Johnson had agreed to pay in the August 1986 settlement remained unpaid. In 1988,

however, the estate of Harry Johnson faced the possible loss of the family home as a

result of various debts.294 As a side effect of this situation, one of the sons of Harry

Johnson agreed to settle the balance owing to the Maori Trustee, plus interest at 17 per

cent. The principal paid was $23,303. The interest for the period from 4 November 1986

to 22 December 1988 was $11,305. The total paid was therefore $34,305.295

5.5 Negotiations about Legal Costs 1989 - 1993

By February 1989, it had come to the notice of R T Hovell, solicitor for R D Hovell, that

the defendants had paid the amount owing under the settlement. R T Hovell wrote to the

Maori Trustee, stating that

This settlement was arranged on the basis that Mr Hovell would receive full compensation for his expenses incurred in having the matter brought to trial.

He asked what arrangement was being made to reimburse R D Hovell for these costS.296

R Wickens wrote in yet another memorandum that:

292 For details of the various Bills of Costs, see copy of these, 4 pp at folio 391, AA VN W3599 54/91120, NA Wellington 293 For initial verbal acceptance by Hovell, see Minute on R T Wickens to Rimu Pohatu, 7 August 1987. This was then further minuted 'Approved', (illegible signature), dated 11 August 1987; For rejection, see Note for File, illegible initials, 13 August 1987, with further note 19 August 1987, both in AA VN W3599 54/91120 294 Wilson, Barber & Co to The Manager, Rural Bank, Gisbome, 3 May 1988, 18/130/2 vol 3, Maori Trustee, Gisbome Office 295 R K Pohatu for District Manager to R Wickens, 2 March 1989, 181130/2 vol 3 296 Burnard Bull & Co (R T Hovell) to Maori Trustee, Gisbome, 9 February 1989, AA VN W3599 54/9/120

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The fact that Mr Tupara failed to secure an indemnity from Mr Hovell was a serious mistake, as it left us exposed to a claim from Hovell.297

In May 1989, Wickens advised R K Pohatu at the Gisborne Office that Hovell might be

offered $10,000, this time in the form of a cheque, as a 'full and final settlement'.298

In July 1992, the issue of Hovell's legal costs remained unresolved. Mike West, Solicitor

at Head Office, wrote that 'We should now ... try to make some assessment of the degree

of negligence on the part of the Maori Trustee.' He asked for a submission from the

Gisborne Office as to whether the Maori Trustee should 'accept liability to the extent of

$30,000'. He stated that

If liability should be accepted, this will have the effect that the MT loan will be repaid without a corresponding debit being made to the block account and thus the whole matter should be resolved?99

A copy of this letter was sent to Ieuan Hyslop, the Regional Solicitor, Wanganui.

In October 1992, J C Kinder, the Regional Solicitor, Gisborne, reported to West. He

referred to Hagen's testimony about the value of the trees felled. He considered that:

[Hagen's] evidence was not seriously challenged and it appears from the questions asked by the Judge, that his estimate of value was accepted. Even at a lower value, the value of the trees would be well in excess of the settlement figure of $27,500.

Mr R S Chambers, counsel for the Maori Trustee, in his report after the settlement, made it clear that the settlement ultimately arrived at was one which he would have recommended to the Maori Trustee had the estate not been virtually bankrupt. He went on to say that had the matter gone on to judgment "I believe that we would have received damages well in excess of $27,500, but well short of the sum claimed". It is now known that there was some considerable doubt on the financial status of the estate, as put to

R T Hovell is a son ofR D (Sandy) Hovell. 297 Wickens to West, 7 April 1989, fo1438, AA VN W3599 54/91120 298 R T Wickens to R K Pohatu, 5 May 1989, fo1440. For draft Indemnity proposed for signature by Hovell, see fo1439. Both in AA VN W3599 54/91120 299 Mike West, Solicitor, Head Office, to John Kinder, Regional Solicitor, Gisbome, 16 July 1992, Copies to: Joe Paenga, Senior Trust Manager, Gisbome; Ieuan Hyslop, Regional Solicitor, Wanganui, fols II(b), II(c), 18/130/2 vol 4, Maori Trustee, Gisbome Office DB

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the Court at the time, and subsequent events have shown that the estate did have access to funds. Hovell has always been consistent in his assertion that he was to be reimbursed for costs etc. if the estate ever came into funds.

Two other matters should be kept in mind. Firstly, the Lease Inspector of the Maori Affairs Department John McCready [sic], was present at the time the trees were cut down, and appears to have acquiesced in the action. The other matter is the case has only been adjourned, and can be brought on at three weeks notice. Any settlement arrangement would have to incorporate some direction from Hovell to abandon his claim.30o

This memorandum indicates that Kinder, at any rate, found convincing Hagen's

testimony about the value of the trees felled. The sentence beginning 'Mr R S Chambers,

counsel for the Maori Trustee' reads somewhat strangely. It appears to the writer that a

'not' may have been omitted from the original report of Chambers to the Maori Trustee.

The writer has not, however, seen the original report. At any rate, the quotation from

Chambers indicates that Counsel for the Maori Trustee would have expected Justice

Smellie, had he made a judgment, to have awarded damages well above the $27,500

figure in the 1986 settlement.

The $27,500 figure was significantly influenced by the understanding that in 1986 the

Johnson estate was virtually bankrupt. Kinder's report seems to suggest, however, that

since 1986 doubt had arisen as to whether the financial situation of the estate was as

serious as parties were given to understand in 1986. It also indicates concern about the

role of McCreadie, although the High Court Transcript indicates that his alleged

acquiescence related to the earlier bulldozing of smaller trees in the block, rather than the

'devastation' of 1982.301

On 3 March 1993, Hyslop, the Regional Solicitor in Wanganui, sent a letter to Wilson

Barber and Co, for the attention of R T Hovell, the claimant's solicitor. R T Hovell has

300 J C Kinder, Regional Solicitor, Gisborne, to Mike West, Head Office, Maori Trust, 20 October 1992, fol 1347, 18/130/2 vol 3 DB 301 See sections 4.4.1.4 and 4.4.1.8

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supplied a copy of this letter to the writer in response to a request for a copy of the final

settlement over the issue of the claimant's legal costs. Hyslop wrote:

This letter will serve to confirm the writer's recent telephone advice as to settlement of this matter. It is proposed that settlement be effected as follows: (a) That the $34,305 received from the Johnson Estate (or so much as

is necessary to repay the Maori Trust loan) be treated as credited to the Hovell Maori Trust mortgage repayment account as at the date this money was received from the estate of the defendant lessee.

(b) That if the $34,305 is insufficient to repay the Maori Trust loan debt plus interest as at the date these moneys were received from the estate of the defendant lessee, the balance of the debt be written off.

(c) That the Maori Trustee credit the $34,305 to the Hovell Maori trust loan account without debiting the block account and that a write off of this amount be made. As you know, this money was applied in reduction of the owners debt on the block account when received from the estate of the deceased lessee. The position will be treated as unchanged in this respect.

(d) That Mr Hovell execute the lease of the property back dated to the original intended commencement date and pay the arrears of rent under that lease. The lease to be at the market rental without abatement and the rent is to be applied in repayment of the balance owing on the block account.

The effect of the foregoing is, of course, that the Maori Trustee pays the $34,305 from his own funds to the benefit ofthe owners in the block taken as a whole. 302

The settlement involved Hovell receiving money from the Maori Trustee to be offset

against his mortgage account, without a corresponding amount being charged to the

Papatarata A2 block account. In the context of West's comments about assessing the

degree of negligence of the Maori Trustee, it would seem that this settlement amounted to

an implicit admission of negligence.

It needs to be borne in mind, however, that the solicitor for Hovell was very clear that

what was being settled was the issue of Hovell's legal costs. He made it clear that various

302 I J Hyslop, Regional Solicitor, Wanganui, to Wilson Barber & Co, attn R T Hovell, copy ofletter supplied by R T Hovell, Solicitor for the Claimant. DB

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· other questions remained.303 First among these was 'The prospects for compensation for

the loss of native trees felled.' This issue is central to Waitangi Tribunal Claim Wai 679.

5.6 Conclusion

Previous chapters have indicated that there was a certain amount of ambiguity around the

issue oflegal costs in the early 1980s. Hovell and his solicitor were clear, however, that

they had had an undertaking from the District Solicitor, Gisbome, that the Maori Trustee

would meet Hovell's legal costs.

Officers of the Maori Trustee were aware that the issue of the Papatarata A2 lease had

been handled in a less than ideal way. Wickens conceded that the second case could have

been avoided, had the evidence of the Ruatoria lease inspector been more accurate. Yet

the Maori Trustee was very slow indeed to move to settle the issue of Hovell' sIegal

costs.

Over and above this issue, however, there still remains the issue of whether the owners of

Papatarata A2 are to receive compensation for the trees which were felled on Papatarata

A2 in mid 1982. These trees were felled in the wake of the prolonged delay by certain

Gisbome staff of the Maori Trustee in taking legal action against the lessee when

instructed to do so by Head Office.

303 Ray Hovell to Maori Trustee, Maori Trust Office, Wanganui, 14 June 1993, Copy ofletter supplied to the writer by R T Hovell, Counsel for the Claimant DB

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CHAPTER 6: CONCLUSION

Papatarata A2 adjoins the Pipituangi block in which the whanau of the claimant, R D

Hovell, has an interest. This report is concerned with a lease of Papatarata A2 made to

two members of the Raroa whanau in 1967, and then transferred to Harry Johnson in

1974. It should also be noted, however, that this report has indicated the possibility that

this was not the only case where there were problems with a lease of Maori land

administered by the Maori Trustee.

In 1967, Papatarata A2 seems to have already undergone several decades of neglect by

the previous lessee. The Maori Trustee had no voice in the original choice of the Raroas

as lessees. They were chosen by a meeting of assembled owners. The Maori Land Court

then confirmed this decision. Despite this, the Maori Trustee was the agent for the

administration of the 1967 lease on behalf of the Maori owners of the block.

The Raroas proved unsatisfactory lessees. They were often late with rent payments. They

also failed to observe the covenants in their lease regarding matters such as boundary

fencing, clearing, grassing and topdressing. They soon unofficially sublet the block to

Harry Johnson, a Ruatoria farmer. Johnson officially took over the lease in 1974. This

transfer of the lease occurred without any consultation with the owners. Johnson was not

an owner.

The Hovell whanau had ancestral links with Papatarata. The claimant's ownership of

shares in Papatarata A2, however, resulted partly from the purchase of shares by his

father, Thomas Hovell, in 1972, and partly from later purchases of shares by the claimant

himself. R D Hovell was a builder, but came from a farming background and in 1986

described running a farmlet himself. He made no secret of his desire to lease Papatarata

A2 himself.

Staff from the Gisborne office of the Maori Trustee were aware that it was not easy to

persuade a court to dislodge a lessee. This partly explains their apparent lack of sympathy

85

over Hovell's growing level of concern over the block. But this report has also argued

that there were various problems over the years in the Maori Trustee's actions as agent

for the owners. Lease inspections were sometimes delayed until some special factor

prompted a visit by the lease inspector. Inspections were apparently not always thorough.

When inspection revealed breaches of the covenants in the lease, the Maori Trustee

sometimes reacted very slowly to the situation. Indeed, from 1967 to 1977, virtually no

improvements seem to have been made by the lessees. Yet it was only in 1977, not long

after the probate of the will of Thomas Hovell1eft R D Hovell as officially an owner in

the block, that the first section 118 property notice was issued to the lessee.

One particularly important problem related to the lease occurred in 1980. It is possible

that a more accurate report by the Ruatoria lease inspector employed by Maori Affairs at

the time of the 1980 District Court hearing would have resulted in the forfeiture of the

lease at that point.

A second very significant problem was the time taken by Gisborne staff to act against the

lessee in late 1981 and early 1982. This delay occurred despite instructions from the Head

Office of the Maori Trustee to take action against the lessee. It is possible that more rapid

action by Gisborne staff over this period would have prevented the felling of valuable

native trees on the block in 1982. Trees destroyed earlier in the controversy over the lease

seem to have been significantly smaller than those felled in 1982.

For some years, Hovell was represented by D G Witters, a Gisborne solicitor. In both

1979 and 1983, however, it was arranged for Witters to represent the Maori Trustee in

actions against the lessee. Regrettably, in both years Witters felt obliged to elect to be

non-suited as a result of a legal technicality. This contributed to delays in settling the

controversy surrounding the lease.

86

From 1977, Hovell sought the help of various politicians, particularly Ministers of the

Crown, in his dealings with the Maori Trustee and the Department of Maori Affairs. He

wrote frequently to two successive Ministers of Maori Affairs. The second of these

Ministers, Ben Couch, appears to have been somewhat reluctant to give credit to Hovell's

accusations against staff of the Department of Maori Affairs. His attitude to Hovell seems

to have mirrored the less than positive views towards Hovell held by some staff at the

Gisborne office. At a time that he no longer held the Maori Mfairs portfolio, Duncan

MacIntyre seems to have been rather more ready to press for resolution of the situation.

Neither minister, however, seems to have sought to change a situation where it was

possible for a lease to be transferred without any reference back to the Maori owners of

the block.

In 1986, Justice Smellie heard two weeks of evidence relating to the lease of Papatarata

A2. Much of this evidence related to the value of the trees felled in 1982. Evidence by

expert witnesses for the plaintiff, the Maori Trustee, suggested that, if left until 2026, the

trees might have been worth more than three hundred thousand dollars, before allowing

for risk. An expert witness then adjusted this sum back to a range of values to indicate

what the trees would have been worth in 1986, had they not been felled.

While there were debates about the various rates used in calculations by expert witnesses

for the Maori Trustee, the Counsel for the Maori Trustee apparently thought that, had the

case not been settled, the Judge would have awarded a significantly higher level of

damages than the $27,500 settlement arranged by the parties. This figure was apparently

arrived at because of a belief that the estate of Harry Johnson was virtually bankrupt. The

figure was relatively low, over against the range of values put on the felled trees and the

cost of remedying damage to waterways.

Despite this, most of the settlement was not apparently paid to the Maori Trustee until

late 1988. At that point, it was set off against the heavy overdraft in the Papatarata A2

87

block account. This overdraft was mainly the result of costs related to various legal

actions over the lease, particularly the very expensive High Court hearings of 1986.

The claimant, however, had also incurred costs of more than twenty-seven thousand

dollars. This issue of Hovell's costs had a somewhat ambiguous background. The Head

Office of the Maori Trustee had emphasized the need to get Hovell's agreement to pay

legal costs if Counsel were to be retained to appear in the High Court. But Hovell and his

solicitor at the time of the High Court case were both insistent that they had had

assurances from the T Woods, when he was the District Solicitor in Gisborne, that the

Maori Trustee would meet legal costs.

The files of the Maori Trustee indicate some awareness that the actions of some staff of

the Maori Trustee had been unhelpful in resolving problems over the lease. Yet the Maori

Trustee was still slow to settle the issue of legal costs.

Furthermore, the sum paid into the Papatarata A2 block account on account of felled trees

was trifling in comparison with the valuations placed upon the trees had they not been

felled in 1982. Even this small sum was swallowed in legal costs. The claimant and other

owners in the block have never obtained financial compensation for what Ferris, then

Assistant District Officer of the Department of Maori Affairs in Gisborne, described in

1982 as the 'wanton destruction of native trees.'

88

AIBLIOGRAPHY Primary Sources Unpublished Official High Court, Gisborne: Actions Register 1983 - 1985 [or 1986] High Court Minute Book [no years on spine, but page 1 is for 20 February 1985] Transcript, Written Briefs, Papers and Exhibits related to Al1/85 Maori Trustee v Estate Harry Johnson Maori Trustee, Head Office: AA VN W3599 54/9/120 (held at National Archives, Wellington, but access restricted - read at the Head Office of the Maori Trustee) Two files and loose papers returned to the Maori Trustee by Counsel for the Maori Trustee in the Maori Trustee v Estate Harry Johnson (read at the Head Office of the Maori Trustee) Maori Trustee, Gisborne Office: 18/13012 vols 1 - 4 (read at the Head Office of the Maori Trustee) National Archives, Wellington: AAMK 869/1191a Maori Land Court Minute Books Tairawhiti Maori Land Court Maori Land Court Minute Books

Unofficial Correspondence related to the claim; Hovell Whakapapa; and Written Brief of Hagen from 1986 High Court case, supplied by the Claimant (R D Hovell)

Correspondence supplied by Counsel for the Claimant (R T Hovell)

Published New Zealand Official Yearbook 1977 (Wellington: Department of Statistics, 1977)

Secondary Sources Unpublished Katherine Orr-Nimmo, 'The Land and the Blackberry: Aspects of the History of the Hereheretau and Kahaatureia Blocks with special reference to Hereheretau Station and the Maori Soldiers' Fund' April 1998 (Wai 201 record of documents doc Rll)

Published G V Butterworth & S MButterworth, The Maori Trustee (The Maori Trustee: No date or place of publication given, but introduction dated May 1991)

I

APPENDIX 1: Direction Commissioning Research

\fED

.\ ~~!j~L+j t_~.,,~.·· ....

WAI 679 # ~ .,2

W AITANGI TRIBUNAL DUPLICATE CONCERNING

AND CONCERNING

DIRECTION COMMISSIONING RESEARCH

the Treaty of Waitangi Act 1975

the Papatarata A2 Native Trees claim

REPLACING EARLIER COMMISSION DATED 21 August 1998.

1 Pursuant to clause 5A(I) of the second schedule of the Treaty ofWaitangi Act 1975, the Tribunal commissions Dr Katherine Orr-Nimmo, a member of staff, of Wellington to complete.a research report for this claim covering the following matters:

(a) The circumstances relating to the changes in ownership and use of the land known as the Papatarata A2 block, Te Araroa.

(b) Specific details relating to the covenants of the lease, and the degree to which these were enforced by the Maori Trustee

(c) Whether there is any evidence to support the allegation that the Minister of Maori Affairs and other Ministers of the Crown, failed to protect the native trees on eighty acres of the Papatarata A2 block, Te Araroa, from being cut and burnt by a lessee with a Maori trust lease.

(d) Any other matters of relevance.

2 This commission commenced on 19 August 1998.

3 The commission ends on 16 April 1999, at which time one copy of the report will be filed in unbound form together with an indexed document bank and a copy of the report on disk.

Cont page 2. The report may ......... .

.' .r") . ,

Wai 679, Orr-Nimmo

4 The rep0l1 may be received as evidence and the author may be cross examined on it.

5 The Registrar is to send copies of this direction to:

Katherine Orr-Nimmo Claimants Counsel for Claimants Solicitor General, Crown Law Office Director, Office of Treaty Settlements Secretary, Crown Forestry Rental Trust Chief Executive, Te Puni Kokiri

Dated at Wellington this 2J....t day of March 1999.

Deputy Chief Judge N Smith Deputy Chairperson WAITANGI TRIBUNAL

","~PPENDIX 2: Document Bank

1.,-4

p.o. Box 3035,

GISBOPJ\TE.

22md IS e p t em be r , 1 980.

Mr B. Couch,

Minister of Maori

'{l/ELLINGTON.

SecrQtary. MaorI Affalr:s ACTION

RR.E~ K)R ~JfORUJfd9~

Dear Sir, I / Thank you for your rec apprec iate ;,{our continued interest

out regret you are continually--ee-:tilg misinformed oy your Department on

many of the points raised by me, Their concerted efforts to withhold

the truth from you regardi-".g their false evidence pr'esented at the Court

hearing is the re:'lson I stl11 feel a meeting as proposed in my previous

letter would oe of ' benefit to all concerned.

Your remarks concerning removal of native trees: ThLs VIRS not regener

ated scrub but white pine, rimll, totera and tawa trees - some at least

forty to fifty years old. I\':r Jolmstoni.s reponsible for the 'HilfLll

destruction of these irr'eplaceable native tI'C,C':S in diPC';c;t viol::ition of the

terms of his lease. These trees :nean nothing to !Vir Johnston nor OlJviousl;:,'

to your department but to tile ownees in the block it represents co,:1plete

de struction of a scenice nS.ti ve 1'13 serve wi th invslJable enviro o!J2nent al

significance. It is also a violation of our conserv~tion laws of this

country to remove nativ'j trees ino.iscrimi:le.tely. Ther'e [(1:'e hUIHlreds of

acres of scrub not cleared as well as 1-1r ,Johnston's first ,3.tteL!lpt of six

acres which has regenerated due to his incl)!,cpetence fila. clearing of this

would have been more reasonable.

You state the I'.Taori Trustee did not support the taking of the case to

court because of work done oy ILl' Johnston. ~hs 2':;aori ",'r'L13tee at no time

said or indicated he did not support rn;y case. In fact, he agr'eed to

1111' ',Vitters, my solicitor taking the case for the Dep810 twent as JiIl~ Bennett,

Maori P_f1'airs solicitol', had said: luote - "1 woul::l prefer' r,;!r' 'Yitters to

take the case as he is a better court ,nan than I." Lll1ClLlote. M;y solicitor

has an o1'1'ic ial le tter of authorLsation from the MaoY'i Trustee reclue sting

he take the case to court on behalf of your department. If your department

was withdrawing the 11' case sure ly my solie HoI' should have been offic i ally

notified of this.

You a sk for the facts to oe pre sented to you. Surely, Sil", you realise

we would not raise these issues without proof of their validi ty. The

surveyor's report which you seem to have totally disregarded proves YOul'

field officer's neglect to give a true appraisal of the s,ituatj.on at the

court hearing. You state you have requested an up-to-date repoy·t from

Mr McCredie on the state of the property. What credibility will such a

report have? Is his report to be accepted with no suostantiation fr'Ol-:l

any other person. He has already pr'oved himse If to be Em irre sponsilJle

. your Department. He argue d in court that fenc inc had been done

bY":Mr Johnston when in fact the surveyor' had specifically lookedfor' this. ,.",,' "" .....

fene-e'and found none existed. The boundal'y fene ing !'.1r McCredie stated in

completed is absolutely not true.

I

fe¢:~ig that had been done by I

a prev"cous owner. upprox iU12 te ly t "'ell,·,·, .... r-"''''1T'>n acres of Q'oou lund oUtQ,l'r'e tl'lP ""ounc·l.".,ry f r'liC'" ., l ' ' n J ~ ..... -- v u ....... -..l - U --, v I.~ p r'e; C3lJJTL::J.;J __ ~T vrC. i 'Cl2-1g

to Jl, i)'lto the river along with the eighty acres thut ho<3 alr'eqdy done so.

r egg, ~dd that not one fenced paddock exists on the Whole property which ,,)

wili' COJlfine stock. This is not far'uing in a husbandlike

On .both occasions the court proceedings 1,vere held on 3, ~lond3,Y and each

time your field officer made inspections OI~ the property fOlO ;'.!r Johnston the

Sunday before. Surely this is not usual practice - Suno3.,j- inspections mU:3t

sw~ly be regarded as special treat~ent for favoured lessees or could it be

he wished to report that some topdressing had been done - on the Saturday _

the first topdressing to be done even though the lease called for 26 ucres

per year to be cleared, grassed 8J1d topdressed. Mr I':IcCredie insisted in

court under oath that 250 acres of land had been topdressed - the surveyor's

report shows only 70 acres of cleared 18J1d, Surely scrurJ 1 rushes, manuka

trees etc. were not topdr'essed to justify such a Cluanti ty.

When Cluestioned about the grassing proGrmnme he insisted grass had been

sown with a crop of brassica. Competent farme:cs advise grass is never sown

with drilled crops with hes.vy foliage. Inspections now ';'[Quld mow no grass

~tsoever but plenty of mud.

In court, w hen the Judge put the Question to Mr McCr~die "H-ave all

breaches of this lease been remedied?" he answered I'Yes. 1I Now, Sir, you ape

well aware that this is absolutely untrue, yet your field officer has no

hesi tation in making these pernarks while under oath.

Also youP local duty solicitor', HI' Bennett, '11[hen called at the beginning

of the hearing only to present the rentoook ':lnd canfin':! thut a property

notice had been served on the lessee continued on to Sa;)r that the Maori ';1

Trustee was completely satisfied that all breaches of the lease had been

remedied. This called for the Judge to remark - quote: IIli'Tnat 8.1"13 we all cloin~,

here then. \I unQuote. - This ,vas befol"e any evidence aboLl t the case hacl been

given. From this Sir, you will recognize a det(~rrn1n2,tion lJJ your Dep8,rtrnent

to sCluash the case before it even started.

I can underst8J1d your reluctance to accept claims of lmethical conduct

your employees but when facts are brought to your attention I fail to

underst8J1d why these cOT'1plaints are not thoroughly investigated. I went to

considerable effort to o'btain honest all,d reliable evidence of the S:Eite of

the property at the date of the court hearing, eneaginb an experienced

competent surveyor using sophisticated, modern electronic eCluipment to give \ a true 8J1d accurate report on the prope rty. , \

"J

IvIr Johnston h as been continally protected and helped by ;y'our Departrnen't'

with inspec tion delays, excuse s for work not done, application for forfei tn.':;:;

delayed. He was served a proper'ty notice in August 19T7, pl"oving his refusal

to carry out the work reCluired. This propert;-/ notice requires rent to be

stopped irninediately and court action taken. Rent was not in fact stopped

until April 1978 allowing Mr Johnston extra ti:lle to C&1',o,';, out work - however

none was done. 'i\Then we finally did get the case to COUI't ,yOuI' Dep2,rtment

would not even allow us to sue for all broaches of the lease - only the

fencing 8J1d clea,ring. Your Department clai,n l:~r cTohnston tDok over the lease

with breaches existing from the previous lessee~ but Mr Johnston had had

use of this property since 1966 without alW conditions being placed on

hir;~ ''It all until I, as an individual concerned OWnel" urged the Tilaori Affail"S I

to look into this matter.

As long as let ters are to be forwa:'ded back to the GL3b orne office from

you for comments fro:fl the Field Officer here, he c an continue stating

whatever he chooses to protect himself and l'lr Johnston and so cover' up the

true situation .definitely. This method has been carried on for the past

four years now, still producine; negative results.

The Maori Land Court Judge informs me ~(ou have the power to ins tl'uct

the Maori Trustee if they have not been acting in the true interest of the

owners. I' feel in the light of tile infoI'wation I have given you, I, as an

owner have been grossly ·discriminated [::gainst alid vlOi~ld reQuest that this

"'latter be resolved fairly by a transfer of t?~::; lee.se to :nyself as the only

.. once rne d owne r.

As },'1r Johnston has applied for a transfer of' the lease I feel t21is is

an excellent opportunity for you to put rigllt this deliiJeI'ute miscal'I'iuga

of justice by your Department.

APPROVED SEEN I CONCUR DRAFT REPLY

/ /19

Your's fai thfully,

(R. D. HO\./~~LL)

\

-I

R.D. ROVELL •. MI.N~STERIAI:.

Questions and aecusations made:-

1. I can see no useful purpose beJn{~achieved) in a meeting 'with the Minister, Mn Couch, a local NP , Mr Bell~ the Maori Trustee and Mr Rovell.

2. Mr McCreadie advises that it is true that some native trees have been destroyed within the main body of root raking these were minor scrubby type trees v/hich are probably "nativel! to New Zealand, but the biggest and best have been~. If the dozers had not been able to penetrate the major canopy, there would have been little or' no root raking done which is the major point of the whole exercise.

3. The accusation of the lessee's attempt to clear the regenerated scrub is answered in the report dated the 3 November 1980.

4. The accusation that the Maori Trustee did not support this application appears to be incorrect as the District Solicitor on the 3 July 1979 advised Mr Hovell's solicitor as follows:-

"It has been my repeated advice to your client that the likelihood of success in any action for recovery of the land would be slight and especially sO if the lessee undertook to remedy the breaches. 'l'his he appears to be doing as work is continuingll"

5. There is no record of this quote on file.

6. We refute the question of the credibility of the two officers involved as we have complete faith in their work and judgement and would refer you to Mr HcCreadie I S cOll.lmenb, 'dated June 1980"

7. The question of gpod husbandlike farming has been answered by Mr McCreadie in his reports~

8. Mr Rovell talks of 250 acres being topdressed and the report showing 70 aCres cleared. I am unable to account where he got these comments from but the topdressing shows that 25 tonne has been Bown. Refer Field Officer's report dated 13 April 1980.

"

9~ The question of Mr HcCreadie! 6 and Hr Bennett! s performance at Court, I would refer you to tbe respective reports by these two officers which were forwarded to Head Office on the 1 July 1980.

10. It alarms me to think that HI' Rovell can make an accusation that the Minister would condone any determination by our department to squash the case before it even started. I think the confusion is entirely on HI' Rovellle part as he has failed to grasp the fact (and appears confused in the matter) that the Section 118 nO~lce was for specific breaches which existed at the time it was issued in 1977, not for all the covenants in the lease.

11. I cannot imagine the Minister letting stand the accusation that he would be reluctant to accept claims of unethical conduct by his employees, as he is compelled to abide by policies and legislation laid down.

'2. As for Mr Johnson being continually protected~ I find a laughable accusation as I do not see that he has been given any preference but has received the same treatment as any other lessee in our district. I must point out that Hr McCreadie has gone the second~ mile in his duty and devotion to his job by making these inspections on a Sunday and perhaps Hr Hovell is interpreting this as preference to Hr Johnson, the lessee, because it suits his needs to do so.

13. The question of accepting rent is correct. It was a mistake within the office but Mr Hovell has already received a reply to this and I would refer you to the Minister's reply to him dated 5 May 1978, paragraph 3.

14. The covenants raised were special covenants entered into upon the transfer of the lease with effect from the 2 December 1974.

15. This action was not instigated by Hovell but by the Maori Trustee but one must admit that it has continued further and beyond than we would have taken it because of the insistence of HI' Hovell~ This has also been replied to in previous ministerials to Mr Hovell.

16. The question of referring ministerials back to this office for comment is standard practise which Hr Hovell is aware of and I feel that no further comment is warranted. I can guarantee from perusal of our file and personal knowledge of this case and this owner y that at no time has there been any personal discrimination against Mr Hovell but it is entirely a fact~ as recorded on the file, that Mr Hovell thinks the Maori Trustee can simply walk in and oust the lessee. He has also been continually advised to seek legal advice and engage a solicitor but he has continually failed to take any advice or directions from this office unless it has suited his own ends, which is to obtain a lease of this property for himself on h~s terms.

17. The present lessee, Hr Johnson, has requested the consent of the Maori Trustee to transfer this lease to his son Paul, who is taking over the farming operations in this area. We replied on the 24 January 1980 to his solicitors that the Haori Trustee withholds his consent to a transfer of a lease until such time as the District Court proceedings have been disposed of. To date we have had no further requests and have taken no further action on the matter of a transfer of this lease.

B.R. Green 'l'RUS'l' OFFICER.

\

\ The Hon:-'~~~ _~,8~er of Maori Affairs

f'11. FE

""~~'

I~elYe4"OW:1et,er o£2is.~ternb&raud ~~ the Maori Trtlstee £or d.ta.:Ued~:nfQmatlon ·abouttheaeveral matt.., lOU raised in. tbf&:tlettu~ . fh1a~talet1_t~e to~~;d ~tee'e r&pres~t~i!ill '*~~"to.~t& :hisWelliapnfile. A ~OnQt';~,;'~~_··:A2moc1t W$ e.l.omade •. soon u th!~:~_~':;'" .'. ....•. "", .. , . '" ,-' '. '. . .

fJ.be···~~eiia~¥e4~tiJe~aua I ':N~ b".t8\1bS~tly infQ~ _~~tl1$.~ ~H.,cTohnst_ h(I4 41~e&.d.11n , Dec.beJ:'.l(sdea;thma.r place a netlCOJDpl.a1onor.(J¥yhol.. _"fir.. The lease be.$~a.n asset .of' the ~tu~e '8 estate to bedee.lt wJ.th 1D t$l.".m3 of his will or as the administmtor ami benef'iei~es decide. If' you bav.e not al.~ ucme.ined who is administerirJg the esta.te and stated your intereat in acquiring the lease, I auggest that you do tilO sa soon as possible.

Irmpeetion of the leasehold at the end of Ootober{akiJ}wM that since thep~oue .Ap:dl, the lessee bad completed the following work of the cost/value 1ndicated.

as acres previokly sow in crop and undersown with grue had been rewol!k:ed and resown mto new graaa. 86.500 A .t'u1.*ther 15 acres of hea.vy soi'ub windrowed. 1.aoo

The cover as a.t 30 Ooto'belf 1980 vallu

8S acres in new g.ra.es

#8.300 I"

41 acres in ~, tracks. fencelinu end large trees within the 105 am:oes originally xootraked

1$ a.eree rootraked - not yet cultlva.ted and sown.

60 acres old ~t with some patches of heavy r'Il!thes -possible to giant diso, cultivate audSOWD domo

165 acres heavy scrub at Gouthem end - SOU on steep oountry, broken and wet - possib Ie to cut and erase 4O-SO aGree of this.

YOUI',

_i£Ol~ ,Ol~~ .• e!lon;tbat,the late,RrJohnsoU ~.,. '. " . ." . IfIOl'!It}'S:lUC.'· the ''Court hearing. 9.'b18 8lIdhia receritaea. ,',' ,

1f01:Il.a .• "I .... l'\t:IIt certaJ.Dl3r prevent the :Maori Trustee from suec~ in .i1QO'Uil$1~~;iOJlk,',: r'c:: .r' .•• l"orte1 ture. . ,

.;~_ •. 1~r"~_'U<l·· .. >o:tbriDg:tnga lessee to Court aris." , ac1:vloe'otbia soUcitor with .• very ~.~I1~~Jt..

' __ ,... dt:·,atit1~IKI'I.e'lf ~ptea.by th& Courts· in ,sUCh ,.~ ••

tlUllesse&tlf Pe.pa.tara;"ta.":".'\:A2;', a~,.~~""-:'.'·"'''''i~r'~;·~··~;;';;-2~~f;":~~~.i; .tJ~$PJ'3·ttceDt for the ~ 'O'b.iElCt:ltm

_lIS

1tr~es<~~~8t1afled me .. that Hr Johnston ~ei~ea.~.ih& ~''!irustee·sotncers~ the same trea.tment as .fIAY otherleaeee o£

. s:tTdlar lal'ld $ltd tiloseo££leers .have aoted honestly i.mpa:rtlsll.y"end ill good faith. You have _eft clear that you do not acCept this so it bas been azranget\' tbatNr N.J. Fitzharris,. Senior :rama Advisory Officer, lJepartmeat of Agriculture ead Fisher1es will be

, a.vaUable to view tbeblook and give an independent opiDion on the! several issues. ' If youvish to avaU yourself of this the D1atrict Of'ficerof my .department at Gisborne will ~ it on.requeat supported by depos1:t of' the est!ma.ted cost of' the inspection vi~i t.

:--~

\""

~'

~ "

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;; '{~ I JJf( :1!:lU l!lll! ~it 'i:' 'tl ~ f ~ MIll I~ri:t I!frll~~ '~ft Hi

I l~r(1 IllfljW fl!lill·~ I~i ~: !!, It! ~ t 't'J ~I ·I~ I; h : ~ lill! Pi:r',· hlfI'~J iii i~

( ~ ~ !~ 6 }~g; II ;·, .. 11 I: !Iilh II: It' , ~z ~ 0 IItt! .Ii ~ 8mt JI.~~!tll t!z'i ~

'" ..s. '01 I, ,,¢t , 0 0 '..\) 11 I)) 0 ~\;;o?' I~ ().~. ~ ii~'" ell" ~~ir;'I~;- ~a.",

}, "~ \!'" § ~ ih; ~ hi sl;;1 ;:':,II ! f": I; I . l\\\' '{ 0'" I) ,) r ~f··t f' \' -n . ~. . ~ 1""0 \ ''', Q \ ::r: =-, . , ....• ... '. . ., ~

1 ~\(,\ ~~ ~ : !.·.~: ... I. i. i If 'lio'I .. lt .•. · .. iii :/1*1 fi.· .. ~ \, ~' ~ ~.. If' :r11f1 lilt f 1.. 8 ~ \. \C::;:~~\ ~. \. ~ _. 4(w. .,..l: r; E I c:f '. f I J \l)

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ll:J • ~ ..... ', < \ a " , .. ~:,',' \:\. z ~~'J

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Ref: 18/130/2

DISTRICT SOLICITOR

Papatarata A2

Further to my recent discussion with you concerning this matter, I have come to the conclusion that the following action should be taken immediately:

(i) The Maori Trustee should act independently in this matter. Mr Witters, acting on behalf of Mr Hovell, can take his own action on behalf of his client if he so wishes or he may join forces with the Maori Trustee and act in a supportive role.

I want to avoid the impression that

(a) The Maori Trustee has been pressurised into taking action through the insistence of Mr Hovell. ' I

(b) The Maori Trus~ee is acting in a vindictive manner in so far as the lessee is concerned. I am conscious that Mr Hovell has been a most persistent complainant and do not want the lessee to get the notion that the Maori Trustee has been biased by this.

(ii) Would you please prepare, a Section 118 Notice incorporating the following:-

(a) Breaches indicated in the report made by Mr Gordon Kelso of Lewis and Wright, Farm Consultants.

(b) I have changed my view about the use of this report following my recent visit to this block on 8.9.82 and also because we have not been able to get more recent reports from our own field staff. I am satisfied in my own mind that the report completed by Mr Kelso is a true and correct account of the situation here.

(iii) Visit to Leasehold Property - 8 ~9 .1982 In company with Mr S. Hovell, Mr M. Hockey - New Zealand Forest Service Officer and Mr B. Green of this office, I visited this property on the 8th September 1982. The main purpose of this visit was to investigate the complaint concerning the removal and destruction of trees on this leasehold property.y~~~~S ~egard I am satisfied that there has been wanton destruction of~an~-a complete disregard for Clause 18 of the lease. As you are aware, this briefly provides that the lessee will leave any native bush~~ growing upon the property strictly alone unless he has the written consent of the Maori Trustee to cut down damage or destroy such trees. This lessee definitely did not have the Maori Trustee's authority to do what he has done to the trees on this property. Mr Hockey of the New Zealand Forest Service is to provide us with a report in connection with his visit to this property. He has promised to give an indication of the value of the millable timber which has been cut down.

. ./2

2.

Mr Hovell indicated to me that he, as a major owner in th:i..s property, is most displeased with the actions of the lessee and states that he would not at any time have contemplated milling these trees. He stated that their aesthetic value cannot really be determined and that they are irreplaceable.

I am of the view that these trees should not have been interfered with and feel that drastic action is warranted •. 1 therefore would ask that you consider, possibly in conjunction with Mr Witters, whether a figure of compensation can in fact be fixed against the loss of "aesthetic value" here. You should also consider the possibility of terminating this lease immediately because of the serious nature of this breach.

(iv) Another breach which is not included in Mr Kelso's report is the fact that the lessee has placed debris and scrub into the creek running through this property and has effectively blocked it in several places. This contravenes Clause 9 of the lease.

A matter of urgent concern is the disposal of the millable logs which are at present on the property. As discussed, would you please take action today to ensure that the lessee does not remove the logs from this property. It will be necessary for the Maori Trustee to take this action on behalf of the owners of the property and I am arranging for Mr Green to take the necessary action here. I understand that you will be contacting Mr R Barber solicitor for the lessee today in regard to this matter. • ~ "

',,-____ aJ-V- . \L~ \~u~ '~'--'"~~ '~~~ Fqi 9.\tL-

I'

A.J. Ferris Assistant District Officer

(' 9.9. 82) ./

MR B. G~: 7

Would you please take urgent action the timber on this property -

-1. tG ,~+ "'-c..- -0-

~ I\·~'VL...

\ ', /,iI l'~~ . ), \.(-.. ::'YcA v-- ~:.J J

~.J. 'h; ''\')v-t. ~\l!s- I\.,;..A.>,,'--'. "t' i~ J-(.~- "1"\

\I':,u-"",,,,, 0., "..>r-. ~~dL~ S). J ,,,,sV',,,;.J;--z- l~,J.\,,- ~-, ~Jl.... \:-.\.....;,''I-.,MOII'->''''-.>

in connection with the disposa~\ (, "1 V~

(a) Ascertain the most advantagious method by which these trees can be disposed of.

(b) In addition to local timber milling interests, also explore the possibility of Gisborne firms making offers. .

\(

\c) Do not overlook the possibility of mobile milling operations on the

\\\ property.

~\\}z_~

A.J. Ferris A.D.O.

9.9.82

•••

5 NoVeimber 1982

Messrs Witters, Ri'GllWOrth & Wall, . Solicitors, P.O. Box 55, GIS BORNE.

Dear Sirs,

RE: . SANDY HOVELL - PAPATARATA A2

18/130/2

ATTENTION: Mr Witters

Please find enclosed a copy or the Section 118 Property Law Act Notice serv~' on' Ron Barber as Executor of the estate of Harry Johnson. The Notice was posted by registered lI.lai1 on the 8th October 1982. A copy was also sent to the Rural Bank as mortgagee.

Enclosed please findla copy letter from Ron .Barber in response.

Mr Barber claims that the breaches' of covenant specified have, in fact, been remedied and that compensation will be paid for trees felled when an accurate figure on their value is supplied to him.

Your client is unlikely to accept that the breaches of covenant have been remedied and the Maori Trustee has not inspected the block since the issue of the Property Law Act Notice,so cannot confirm or deny Mr Barber's comments.

The Maori Trustee agrees with you that the best way to have this matter settled once and for all, is for it to proceed to a hearing. Accordingly, you ar~ requested to act on behalf of the Maori Trustee in the preparation, filing and prosecution of an action for forfeiture upon the grounds of the lessee's failure to comply with the covenants contained in the lease and more particularly, his failure to comply with the Property Law Act Notice.

It is understood that Mr Hove11 has met your costs to date and will meet your costs on the prosecution of this action. If the action is successful then the Maori Trustee may give consideration to meeting part of the costs of ,s action only. The amount ,",uld be detenn1ned by reference to the

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. shareholding in .the block not held by your client •.

The authorisati,on forwarded to us by you with your letter of 28 June 1982, is returned •

Yours faithfully,.

(~ett) DISTRICT SOLICITOR.

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5 August 1986

Messrs Burnard. Bull & Co., Solicitors. P.O. Box 946, GISBORNE.

Attention: Mr Stephen T. Crosby

Dear Sirs,

Maori Trustee v Barber

(IS/'

TW:SM

1. I am writing this letter to you on the instructions of counsel.

2. First, Dr Chambers would like to express his appreciation to your Mr Crosby for his efforts in settling this proceeding earlier this week.

3. Secondly, I have been asked to make clear that the Maori Trustee will expect strict compliance with the terms of the settlement agreement. I do not want you to be under any illusions in this regard: the Maori Trustee expects strict compliance. and will be insisting upon it. Your client has at times tried to argue implied terms or usage to the effect that the l1aori Trustee accepts fair attempts to comply with an obligation as being good enough. I am giving notice now that "fair attempts" will not be good enough. Accordingly. if there is a breach of the settlement agreement, the Maori Trustee will not hesitate to bring on the adjourned proceeding for hearing again and to obtain judgment upon it. Of course, the Maori Trustee reserves all his rights to sue on the settlement agreement in the alternative. Your client should be avJare that the Maori Trustee will not necessarily simply rely on his right to interest in the event of late payment; he may well decide promptly to bring on the adjourned proceeding for hearing and determination as soon as possible.

4. I have been instructed to write this letter so that there can be no misunderstanding between the l1aori Trustee and your client as to the Naori Trustee's attitude towards the settlement agreement and towards the need for strict compliance with it. As you are aware, the Maori Trustee agreed to settle for the amount of $27,500 only because of the representations made by your client on Monday as to the near bankrupt state of the estate.

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It is imperative, therefore, that your client should take whatever steps are necessary as soon as possible to raise the finance to enable payment to the Maori Trustee on or before 4 November 1986.

ithfully,

M.A. 292

ESTATE ,'-., TRUST

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FROM:

DATE:

SUBJECT:

Mike west Maori Trust Head Office WELL I NGTON

GISBORNE

30 October 1992

PAPATARATA A2 : HOVELL

Further to previous correspondence in this matter, have now searched the Court1s records, file and transcript of the evidence in the case Maori Trustee v. Estate Harry Johnson and report as follows.

The main thrust of the claim revolved around the defendant1s action in cutting down native trees on the Block. Not only was he alleged to have committed breaches of the covenants in the lease, but his actions also led to loss of possible income to the owners. One of the main questions for the Court to decide was what were the trees worth.

The main witness for the Maori Trustee was Mr John Hagen. Mr Hagen is a partner in the international accounting firm of Deloitte Haskins & Sells. He holds a Masters in Business Administration and a Master of Commerce Degree. He is a member of the N.Z. Chartered Accuntant1s Society and at the time held a senior position in the Society hierarchy. He is very highly qualified.

I have perused the transcript of Mr Hagen1s evidence given in Court. He was called by the Maori Trustee to give evidence of the value of the trees. His evidence is of a highly technical nature but in brief he put a value of $332,000 on the trees at the time they were cut down. He exp 1 a i ned that as they were immature trees, their value would be well in excess of this and by a series of calculations, he projected their value at the end of 40 years. His evidence was not seriously challenged and it appears from the questions asked by the Judge, that his estimate of value was accepted. Even at a lower value, the value of the trees would be well in excess of the settlement figure of $27,500.

Mr R S Chambers, counsel for the Maori Trustee, in his report after the settlement, made it clear that the settlement ultimately arrived at was one which he would have recommended to the Maori Trustee had the estate not been virtually bankrupt. He went on to say that had the matter gone on to judgment III believe that we would have received damages well in excess of $27.,500, but well short of the sum claimed ll

• It is now known that the-re was some considerable doubt on the financial status of the estate, as put to the Court at the time, and subsequent events have shown that the estate did have access to funds. Hove 11 has always been cons i stent in his assert i on that he was to be reimbursed for costs etc if the estate ever came into funds.

Two other matters should be kept in mind. Firstly, the Lease Inspector of the Maori Affairs Department John McCready, was present at the time the trees were cut down, and appears to have acquiesced in the action. The other matter is the case has only been adjourned, and can be brought on at three weeks notice. ___ Any settlement arrangement would have to incorporate some direction f~don his claim .

. ~ ( J ('-K1 nder ) REGIONAL SOLICITOR

16/07 '92 16:49 FA.Ji. 6444996400 MTO HEAD OFFICE ... H ~[TO GISBORNE [4J 002/003

/ M.M.O.571

OUR REF

YOUR REF

THE MAORI TRUSTEE

DATE~

TO:

cc:

MEMORANDUM

16 July 1992

John Kinder Regional Solicitor GISBORNE

Joe Paenga Senior Trust Manager GISBORNE

Ieuan Hyslop Regional Solicitor WANGANUI

FROM: Mike West Solicitor

MASSEY HOUSE 126 - 132LAMBTON QUAY TE:L~PHON!; (04) 4'72 o~ee (12 LINES) I=' 0 eox ~7$ WEUINGTON 1 FAX (04) 4>19.6400

OUR REF: YOUR REF:

SUBJECT: R D HOVELL : PAPATARATA BLOCK A2

1. Thank you for your fax of 15.7.92 and enclosure.

2. Focusing on the meeting of owners that Hovell wishes the MT to call, there is no point in calling such a meeting until the MT has made a full assessment of the extent of his negligence (if any) in administering the Lease.

3. We should do now what we would have to do prior to any meetir".gr natnely try to make some assessment of the degree of negligence on the part of the Maori Trustee. If this degree of negligence could be quantified at $30 I OOO or mar~r there is no point in holding the meeting. A submission by Gisborne Office to Head Office should be made as to whether or not the MT should accept liability to the extent of $30,000.

82 16:J9 FAX 64 J J996400 ~TO HEAD OFFICE ~~~ ~TO GISBORNE i4l00.3/()t.

1'1

2

4. If liability should be accepted, this will have the effect that the MT lOan will be repaid without a corresponding debit being made to the block account and thus the whole matter shnuld be resolved.

S. In the meantime, please do not respond to the letter dated 1.7.92 from Hovell's lawyer.

6. For further clarification of what is required, please refer to our memorandum of 16.4.92.

7. The General Manager, K Bmiler requires urgent action to get this long outstanding resolved as soon as possible.

Mike West

Blr B. Couch,

Minister of Maori

WELLINGTON

Dear Sir,

P.O. Box 3035,

GISBORNE.

18th February,

.. '/52'4 : :.,,1<;:0 FOR 1~~FOR~'tION

/ / ,------------_.

Thank you for your recent letter and your continued interest in this

\\~atter. I,was ~ost surprised however at your failure to reply to the

lssues ralsed ln my letter of 22nd Sept. (copy enclosed) which are

strongly SUbstantiated in the surveyor's report. I feel, Sir, you have

neglected to study this report carefully as it clearly shows the

X.discrepancies in your Field Officer's report, particularly in the amount

-.,t of fencing claimed to have been completed at the time of court hearing.

~ It included fencing that already existed, fencing done by the adjoining ) I ,

owner and even fencing that wasn t done at all, as well as areas cleared

:/' v

J grassed and topdressed. In comparison the surveyor's report is a true

~ and accurate document prepared by a qualified, unbiased and honest

surveyor and I feel it has not been accorded the value it deserves. I

",.:II! have alleged impropriet;y by your Field. Officer and have SUbstantiated it

~ , with this report.

i}/AI Your October inspection 1980 referred to in your letter is only a

~ ~!~duPlicate of figures presented at court by your Field Officer and shows

~ ft.t the need for a careful study of the surveyor's report which proves

~. otherwise. In your last paragraph you state that your officers have quote-

, 'acted honestly, impartially and in good faith,' and also states that I

make it clear that I do not accept this. Surely Sir, you can understand

why I don't accept it when it contradic ts the surveyor's report. If you

believe that your Officers acted so, do you also disagree with the

accuracy of the surveyor's report?

You suggest my engaging Mr Fitzharris for a report on the state of the

property, incurring more expense for a job I have already paid for but I

would seek your assurance Sir that if it SUbstantiated my claims would

the termination of the lease be in order or would this report also be

set aside and ignored. I have continually reCluested a meeting wi th YOll~/l Mr McCr'edie, your Field Officer, myself, my solici tor, the surveyor' and

a Principal from a local school wi th expert fal'ming knowledge who also

attended the court hearing, as witnesses to confirm everything I have

alleged is absolutely true and correct. Do you think this meeting could

be arranged to settle this issue of evidence presented in court being

contradictory.

You also state in your' letter the COU1~t case was taken by me. ThiS,

Sir, although I paid all expenses is not true. The case was the Maori

Trustee against the lessee - to the extent that when approaching my

solic i tor at the hearing I was ordered to the bacl( of the court by the

JU~ who commented the case had nothing to do with me. Your local

DepaJ.-tment employees Sir all realise how foolish they look with the Maori

Trustee supporting the defendant when they were prosecuting, so turning

the whole case into a fiasco.

I also requested an assurance from you that as Mr Jolmston has

died your Department will not dispose of the lease without first

consulting the owners which was the case when Mr Johnston took over the lease.

I find it difficult to understand your attitude Sir when you insist

your Department's main object is the protection of the owners yet your

Department persists in protecting the lessee with no consideration

whatsoever to the owners and now even after the lessee's death seems to

be determined to continue to do so.

I would appreciate a reply.

APFi=:OVED SEt=I\J

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Yours faithfully,

(R.D. HOVELL)

against the lessee - to the extent that when approaching my

, the hearing I was ordered to the back of the court by the

Mr R D Hovell PO Box 3035 GISBORNE

Dear Mr Hovell

The Hon. Ministor 01' Maori Affairs -.-.....-.... --.. -.---..~-... "----..". -. , ..

Draft reply herewith for you signa t ur e , i f a p pro v e d. • ,. ",';f7.. ,,-<, ___ /1 0-'"""-*_.-9---'\..

, / ~ ~

Secretary /G, I C· / J /

From the outset, I must make it quite olear that I am not aware of any way in whichforf'ei tura of the lease may be effected. The Distriot Court on the evidence before it ruled in the lessees fa.vour. His subsequent death would if anything, incline a Court to increased leniency. I therefore think it inappropriate to continue this correspondenoe. Deepi te this, you are entitled the courtesy of a reply to the matters raised in your letter of 18 February 1981. Where I have previously oovered any pa;rticular aspeot, I will only mention the date of the relevant letter •

.As the matter now stands, there is no useful purpose that can be achieved by having a meeting. I have aJ.:ready stated the obvious reason for this. Similarly, my comments on the destruction of native trees and the clearing of re-generated scrub were contained in my letters of 30 July 1980 and 11 February 1981, respectively.

vlhile I have aJ.ready mentioned the aspect of the Court a.otion .in my letter of 11 February 1981, you have alWS¥s been aware of the possible outoome if it was to proceed to hearing. As early as 3 July 1979, your solicitor was advised by the Distriot Solioitor, Gisborne that:-

"It has been my repeated advice to your client that the likelihood of success in any action for recover,y of the land \-wuld be slight and espeoially ao if the lessee undertook to remedy the breaches. 'l'his he appears to be doing as work is cont.inuing".

It was only at your insistence, and hence total responsi bilHy -U18.t the matter proceeded to hearing.

The matter of evidence given in Court was covered in my letter of 30 July 1980. Bowever, and only in regard to fence lengths and areas cleared, I concede that there were discrepanoies in reports supplied to the District Court. Similarly, I again concede that an administrative oversight in the Maori Trusteeta rent collection procedure cau~ed undue del8¥s in the date that action againat the les8ee could be commenoed.

Mr J oOOson • 8 occupation up to December 1974 w was by an informal a.rrangement wi th the then lessee Mr Raroa. Therefore Mr Jobnson beoame responsible only when the formeJ. transfer ,.,a.e eJcecuted on 5 Deoember 1974. The recome olearly show that the land had been neglected for the previous 35 years.

2 -

With regards Ministerial correspondence, you are no doubt aware of the procedures that are adopted. Beca.use detailed records are held in the Departmental District Office ooncerned, factual information is obtained from that source. That you bave viewed my interpretation as discriminatory is the result of how you have interpreted the information I have given you. Furthermore, your approach throughout suggests an incorrect assumption that I, or the Maori Trustee can simply oust a lessee wbo fails to meet the requirements of his lease.

Finally, and in the matter of the lease assignment, I C&'.lD.ot give an assurance that it will not be transferred without the consent of the owners. The legal position is as contained in my letter of 30 July 1980.

I have already made it clear that it is pointless to continue this correspondence. Neither I or the Maori Trustee can disregard the decision of the District Court. If you do not accept that decision, you should seek the advice of your solicitor and act as you see fit in the light of that advice.

~~le your numerous representations to me have not achieved your desired resul t, I and the Maori Trustee are thankful that you have applied youxself tenaciously in an endeavour to do so. As a result you have highlighted shortcomings in prooedures relating to the administration of' leased properties. The necessary steps to ensure th.J.s does not happen again are being considered.

You will be aware that Mr Fitzharris ha~ inapected and completed an independ.ent report on the Papatarata A2 Block. If there are any matters you wish to discuss regarding that report or tbis letter, will you please call and see the District Maori Trustee, Mr Pouwhare Te Maipi~ He h~ been requested to now handle any enquiries you have.

Yours Sincerely

flv-V ~. Mi~~ter of Maori Affaire

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064 079 78360 DEPT. MAORI AFFAIRS GISBORNE 064 079 78360 DEPT. MAORI AFFAIRS GISBORNE

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PO P05

I i'VORTH/ WALL & N\ATHIESON /(Isr~t·s urd solicitor s

DOlJg!as Drury Rishworth LL.B. Peter Allan Francis Wa!1 LL B jot-In Campbell MF.llh:eson LL.B. , Gladstone Road. GISDorne POBox 55. Teleprlune 81 379

Your Ref Our Ref:

Depru:'trrent of ~ori Affairs, Private Bag, GISOORNE

Attention: Mr. J. Ferris 1:00 ...

Dear Sirs,

Mr. P .A.F. Wa.ll

"WI'I1iOt1I' PREJUDICE"

Re: PAPAT~'Jf. A2 -, OUR CLIENT; SANDY HOVELL

Date: 11th February 1987

011r t118t":'ll$!=linns of t.he 3rd Fehruary 1987 refer. As you are moJD.t·{~""\.Je act for Hr. Sandy Hovell illlU un uur client I s instructions we are seeking sore canpensation for expenses i nCl.wre.d by Mr. Hovell in prosecuting a forfeiture of leaso application knawn as the Maori 'fiustee and Barber.

You will be aware at the conclusion of that hearing a settlement ~greement was prepared between the Maori Trustee and R.A.. Baroor.

Wa nota your Department's advice that the damages ha.ve not yet been paid and we repeat our advice at the meeting that we are prepared to assist the ~~ri Tru~~ in this re ard in overing outstandin mone G due provided we received an undertaking fron the Maon Trus ee at e WJul nteet our costs in that matter. We appreciate that at the present time the Department of Maori Affairs does not have a solicitor in Gicborne and it is for this reason alone tha.t we make the offer.

In any event we understand that you have a schedule of expenditure which was prepared by the writer shortly before the Court matter was settled. From that schedule of expenciitJlrA .; t was clear that up until th9 end of the Court case the Maori Trustee had paid $13/816.12 and Mr. R.D. Hovel1 had pa.id $27,873.48.

The wr iter i 6 aware that during the f in0.1 Court case Mr. w.:::od$ on beha.l f of the

I Department advised our client that he \.VC)uld be refunded all his expenses in prosecuti ng t-h~ mat-ter with the exception of the wr iter's own expenses. This was because the writer's involvement was really only as u wntching brief and Mr. Hovel1 accepts that the writer's legal expenses will not })8 refunded by the Department.

1'.J'i arB aware that Mr. W::xx3.s had had discussions with Head Office and on JTDre than ~le cxxasion he stated that total expenses other than the writer IS \I-Kluld be refunded L1 our (':11 E!nt. We are aware that at the stage Mr. V.](:x:xis made these ccmnents it ,a~ &'"1ticipated that damages in the region of $100,000.00 to $lSO,OOO.OO would be

pA1(l hy the defendants and that in the final outc"'-p damages of (Jrtly $27,500.00 ,,~re agreed upon. While we accpt that that changE: .·e $i tuaf~~iil '.7cxrewhat~ as far as your Depa.r-t:J."nent is concerned when i",r. W::x:xl5 ad·.;,.,<~a that c:. <;:'c';'ic',es 1,.,Q\.lld be repaid he did not hav9 any qu.$llification or conditions attached to ,.1 .le offer .i.n t.hat he eli d not state that if damages were only in a nunimal amount t-: .. e>q:.enSf's \-.'Ould not be n'!fllnded.

W3 note your advice which you gave at our [Y"t:'~' ing of t.he 3rd FE>bn;-3ry : appears that mr. Hovell ma.y have given an ..L, '·~:nnity as to costs ::lC an e:(", ve have not yet ""ighb'Jd t_hat_ indemnity and if your De?artment h~,"o- ,Cl. C0<2~i be pleased to receive same.

~_hat it ~:;.'r date.

_.~ .. -.. ould

vJt-;- r.·:we now taken the opfDrblnlt:y of peillsing the evidence giv(C" jurEK' 'r' hearing 2U'l~; particular the evidence given by yourself as the Director: of th< ~_'r i ,:\,fLu.rs Department ~t GisoonJe.

I

1 • .11 • .1 ':l PO_Z_

064 073 78360 DEPT. MAORI AFFAIRS GISBORNE 01)5 P06

It appears that at Page 202 of the evidence Mr. Ferris stated as follows:-

Question fr~ Mr'. Crosby!

I would ask you Mr. Ferris to look at your file and a draft letter prepared by your then District Solicitor and in particular at the bottom of the first page and nnta~ion there.

Ansv.er:

Yes.

QLlestion:

Tell me ~1at date that letter and note is.

Answer:

The 5th November 1982.

Q,.lestion:

Now having refreshed your mind fran reading that, what attitude did you form as to who should pay the costs of the legal proc:eedings to be brought against the defendant in this case.

Answer:

My attitude, the Maori Trustee should pay full costs, irrespective of outcane at the ti.lre.

It v-Duld appear therefore that yourself had also had discussions with Mr. Vbods and had formed a similar conclusion, that is tha.t the Maori Trustee should refund to Mr. Hovell a.ll expenses.

Fran our point of view we VIOuld take the 0pltHOn that had it not been for Mr. Hovell assisting in payment of costs and in particular in continually putting p;.;essw.-e on your Department to prosecuh"! this matter the Block. knovvn as "Papatarata A2" WJuld neVer have been recoverE'd for the benefit of thE' owners.

Tn addition to the damages awarded by way of agreement we understand there are still rronies held in the rental account for PapataratCi A2 and there are also sane ITDnies which were received for sale of timber sold.

~ acc~pt that frem a pL'"actical point of view the damages recovered are not as great as it was hoped. we feel however that Mr. Hovell should be rein~ursed to some extent for his great expenditurE! in prosecuting this matter. As Cidvised the expenditure mad@ by ow:; client up until the Court case was in the region of $28,000.00 and he a]~c paid various acccmrodation and travel expenses, etc for witnesses who gave evidence dLrring the final Court case.

~ are anxious that this matter be resolved once illld for all and 1n particular before uur client agrees on tel~ ~ld conditions of lease of PCipatarata A2 from the Maori Trustee.

h1e confirm that a Section 438(2) Order ~~as made in the Maori Land Court On Thursday the 5th FebrJary 1987. The term ande-ental to be paid has yet to be agreed and will

064 073 78360 DEPT. MAORI AFFAIRS GISBORNE 005 F'07

be the subject to further discussions betwe~n ourselves and the Maori Tll1stee. Obviously it is essential that the question of compensation be resolved before our c]) ent- can agree on t~rms and conditions.

_ \Sinc~ thB Court case itself our client has spent further monies on the Block in ~ general maintenance and erection of a building On the site. At this stage we have ~ not properly considered the question of partitioning out an area of the land so

.\:\d that our client can solely have ths benefit of any buildings he erects on the Block.

we can advise that our client is a reasonable rnan and will glve full consideration to any realistic offer made by your Department.

Put sirrply OUI client is in a position Whel-e he has spent a great deal of rroney to assist in prosecuting the matter of Papatarata A2. He should be compensated and it is our op-i.ni.on that he has been advised by both your solicitor and your Depart.rrent that he would be compensated in full. Eecause of the lower level of damages agreed upon it may be! impractical thaL he be paid in full jn the SWTl of approximately $30,000.00 to $35,000.00 _ He should hO\l.>'ever be ccrnpensated to serre extent and that matter should be attended to as a matter of urgency_

~ underst and you are to have furt-her discussions wi th ~k. Woods as the Department I s solicitor at the relevant time and we would be pleased if you could contact the writer to either part-_ic:ipat_1? in those discussions or too advise as a result of those discussions what lev~l of rein'bursernent for legal expenses your Depart:rrent is pr~pared to offer tn our client Mr. Hov~ll.

You will 00 awar~ that t-he matter of Papatarata A2 has been going on for sc.tre years prior to the settlen~nt being reached and it would be unfortunate if the final resolution of r.onrt costs, reimbursement thereof and confinnation of new lease dragged on in a similar fashion.

We \!o.Duld be pleased if you could consider the matters mentioned herein and advise us at your earliest convenience.

Yours faithful

RISHW::JRTH WALL &, MP. t>AFW;JA-

SHORT RESUME - JOHN CARLAW HAGEN

Deloitte Haskins-Sells

I, John Carlaw Hagen, am a partner in the international accounting firm of Deloitte Haskins & Sells.

I have a Master of Business Administration Degree in Finance from the University of British Columbia in Canada, a Master of Commerce Degree with First Class Honours from the Auckland University, I am an Associate Chartered Accountant and a member of the New Zealand Society of Accountants and also am a member of the Cost and Management Accounting Division. I am also a member of the Chartered Institute of Arbitrators.

I am a past Chairman of the Auckland Branch of the Ne,., Zealand Society of Accountants and am currently Chairman of the Financial ~ccounting Committee of the New Zealand Society of Accountants and a member of the Accounting Research and Standards Board which body writes the Statements of Standard Accounting Practice prepared by the New Zealand Society of Accountants.

I am the Financial Advisory Services Partner of our firm in Auckland and much of my work is involved in the preparation of business valuations for the purposes of advising clients on both purchase and acquisition of businesses and also for the settlement of disputes as to valuations.

THE MAORI TRUSTEE v R. A. BARBER

Evidence of John Carlaw Hagen

1. Discount Rates

I am advised that there has been expert evidence that the future value, in the year 2026, of the native forest block based on the present day price equivalent, is $332,880. Also that the assessed risk of there not being the base volume of 2774 cub ic meters Ls "no greater than 5 per cen til.

Given the above, in determining an appropriate discount rate one should, in my opinion, have regard to the basic model:

Discount rate = Rf + Rp + i

- which means that the Iinooinal il discount rate is equal to the risk free rate, plus a risic)remium, plus an estimate of ~e inflation rate over the appr~priate period.

One approach to the discounting ?roblem is to make the future lump sum risk free, or a ::ertainty equivalent, by adjusting for risk initially. :hen the appropriate discount rate is the long term risk free Ilrealll rate which on the factors known, I would estimat2 at around 3 per cent per annum .

Using this approach and varying the allowance for risk produces the following:

Certainty Equivalent Calculations

[This approach takes the assessed $332,880 future forest value at current prices and then allows for risk to arrive at a certainty equivalent figure which may then be ~iscounted at a risk free real rate].

Risk Certainty NPV at Factor Eguivalent 3% rate

Initial Value $332880 5.00% 316236 96944.30 ====== 10.00% 299592 91841.97

15.00 % 282948 86739.64 20.00 % 266304 81637.31 25.00 % 249660 76534.98 30.00 % 233016 71432.64 35.00 % 216372 66330.31 40.00% 199728 61227 .98 45.00% 183084 56125.65 50.00 % 166440 51023.32

: .;,

ihHJ'~~ .. H t;;.u

Haskins -Sells

In "he present circumstance I have adopted the 3 per cent rate after a review of the relevant literature and decided cases including:

Tordorovic v Waller (1981) 37ALR - which case dealt with the assessment of damages for personal injury.

There was considerable argument over the appropriate discount rate, risk free rate, tax rates and inflation factors to be considered. Eventually it was held in Tordorovic v Waller that there was to be no evidence given in cases dealing with damages for personal injury on inflation rates or tax rates as there was much too uncertainty.

It was decided that in personal injury cases there should be a fixed rate of discount reflecting both inflation and notional tax on notional income from the invested award. A rate of 3 per cent per annum was determined. This level was derived from a historically used rate (by the Courts) ~f 5% less an allowance for tax and inflation.

It was also decided that ~n personal injury cases the notional investment into "Jhich a lump sum award is notionally invested must be assumed to yield a regular risk free income because it compensates for a risk frGe earnings stream - made risk free by the elimination of contingencies in the precGeding calculations.

Haldane v Haldane (1981) 1NZLR 554 - which case dealt with the valuation of superannuation entitlements.

The appropriate discount rate was the subject of much debate and eventually a rate of 2.5 per cent was used by Somers J., being one half of the rate in the Second Schedule to the Estate & Gift Duties Act 1968. Richardson J, with some hesitation adopted the 5 per cent rate after canvassing alternative jurisdictions.

Morrow v Ministry of Works & Development unreported 7 December 1983 CA 124/81 Woodhouse P. which case dealt with compensation for loss of land.

Evidence was given that the real rate of interest was approximately 2 per cent, supported by its use as the margin above the consumer price index in Government issued Inflation Proof Bonds.

Wright v British Railways Board 1983 2 ALLER 698 in which evidence was given from the open market trading in Government indexed bonds that a 2% rate was a reasonable estimate of the real rate of interest.

2 --!.

Deloitte Haskins-Sells

Addington Timber Company Limited v Bell 1982 un~eported 3 December 1982 A 483/79 Christchurch Registry Hardie Boys J. - which case involved damages to an exotic timber stand where Hardie Boy J. adopted a discount rate of 3 per cent per annum based upon the Australian precedents.

Through the discounting process one is attempting to answer the question: What is the sum of money that would be accepted today in full settlement of· some future claim?

The rate of interest which equates the future cash flows to the present value equivalent is the appropriate discount rate.

In doing this discounting calculation, one must be very sure that the correct factors are used. There are three general rules that must be followed in the discounting process:

(i) Only cash flows are relevant.

(ii) Cash flows should be estimated flows on an incremental basis

(iii) Risk and Inflation must be treated in a consistent manner

Interest rates are usually stated in "nominal" rather than "real" terms, that is they include both a real rate of interest and an allowance for expected inflation. If cash flows are in nominal terms, then to arrive at a meaningful present value the discount rates used must also be in nominal terms.

However, if the cash flows used are real, i.e. net of inflation then consistency would require that the discount rate used should be real. If the cash flows are risky then the discount rate must contain a risk allowance.

For example $332,880 in 1986 dollars is the same as $15,065,900 in 40 years time assuming an inflation rate of 10 per cent per annum.

Similarly if we ignore inflation, because we are dealing in real terms and not nominal terms then the discount rate should be a real rate of interest.

If we eliminate risk by some other adjustment then the discount rate becomes a risk free real rate of interest.

The current issue is most complex but given the information available to me, it is my opinion, that after adjusting for risk an appropriate discount rate is in the vicinity of 3 per cent per annum.

- 3 -

A b Delnitta Haskins -Sells

2. Inflation Rates

With regard to current inflation rates the latest statistics on the Consumer Price Index indicate as follows.

March 1986 quarter + 2.3% Annual increase over the year to March 1986 equals + 13.0% (Source - Department of Statistics).

Forecast increases are for the June 1986 quarter + 2.6%, for the year to June + 10.3% and for the year to September + 9.6% with the September quarter adding 2.1%.

There will of course be a lift of around 5% arising following the introduction of GST on October 1 1986 but this is in addition to the above.

- h -

FUTURE URLUE OF $332,880 IN FORTY YE~RS =======================================

INTEREST RRTE (%)

1···· '. "'j .... .:.....".

.= .•... '-".

11~·=

12~'=

1::::/;

FUTURE URLUE ($)

495,613 735,012

1,0:35,867 1,598,164 2,34::::,471 3,423,9U3 4, '3:34,698 7,231,659

10,455,568 15,065,901 21,637,48'31 30,974,807 44, 2(10, 323

_I '

Haskins·· Sells

~ .• I

\

FUTURE VALUE OF $332,880 IN FORTY YEARS =======================================

45~------------------------------------------------~

40

35

30

25

20

15

10

1 % 2% 3% 4% 5% 6% 7% 8% 9% 10% 11 % 12% 13%

INTEREST RATE

25/03/1999 15:28 54-5-858-7403 PAUL C ERICSON

,<ISt-f\J\/ORTH, WALL & f'v\ATHIESON 'Jdrristers and solicitors 11 GI... ..... lone Road, Gisborne. P.O. BOl( 55. Telephone: 81 379.

four ReI: Our ReI: Mr. P .A.F. wall

DepartItent of Maori Affairs, Private Bag, GISEORNE

Attention: Mr. J. Ferris

Dear Sirs,

Re; PAPATAAATA A2 - OUR CLIENT: SAIDY' HOVEU.

PAGE 02

PI "3>9

Douglas Drury Rishworth LL.B. Peter Allan Francis Wall LL.B. John Campbell Mathieson LL.B.

Date: 16th March 1987

Our discussions of the 3rd February 1987 and our letter of tOO 11th February 1987 refer.

Since that date \lie have had t'-o.O discussions with Tern W:ods who 'We understand has the file in the Maori Affairs office at Rotorua.

Tam was to endeavour to send us a letter setting out the Department1s attitude to the question of compensation but to date we have not received any letter .

. In any event we understand that Mr. Hovell has had further discussions direct with Mr. Ferris.

In our letter of the 11th February 1987 'We set out in particular evidence given by Mr. Ferris as to the question of costs, that evidence having been given during the Court case of Papatara A2A (Maori Trustee -v- Barber). In addition to that the writer has perused his court file. We have a note on our file dated the 11th August 1986. en that file note we have recorded that on the 4th August 1986 when the writer was present at Court ~ had discussions with MI:". W::xxls, Mr. Cl'uurbers and Mr. Crosby and Mr. Barber concerning the terms of settlemmt.

During those discussions the writer had discussions with Mr. W:xx:ls and Mr. W:cds advised the writer on behalf of our client Mr. Sandy Hovell that Maori Affairs would !Met legal expenses.

This was an :ircportant matter as far as our advising Mr. Hovell to agree with the terms of settlement although \IWe appreciate that he was not the plaintiff in the matter and that it was really for the Maori Trustee to accept the terms of settlE!!re.n.t.

During the Court hearing \IWe had been requested to provide a schedule of all expenditure to Dr. Chantlers and Mr. ~ and ~ did that. That sOOwed that the total curount spent up until that tine by Mr. Hovell was $27, 873. 48.

We are also aware of various discussions which took place throughout the hearing and in all those discussions it was agreed that the Maori Trustee would be meeting Mr. Hovell • s expenses. ~er these are all Mr. Hovell's expenses or p~ of Mr. Hove 11 , 51

expenses is not particularly clear but what is clear is that the Maori TrUstee agreed to reinburse Mr. Hovell. '!here appears to be no conditions attached to that offer of reiIrbursement.

As pointed out in our earlier carrespa1dence and in our discussions with Mr. Ferris i t ~ld ctwiously be des:i.rable frcm all party I s points of view that the matter be resolved. We understand that the Maori Affairs DepartIrent have now caveated the land interests (freehold land interests) of the Johnsons.

We obviously cannot assist any further in recovering the rronies that Johnson QI.oIeS

• fI .2 ...

25/03/1999 15:28 54-5-858-7403 PAUL C ERICSON PAGE 03

- 2 -

to the Maori Trustee.

There is obviously therefore little that we can do to assist but on behalf of our client we are anxious to have the question of restitution or reiIrbursement of legal costs resolved once and for all. As pointed out in earlier correspondence until such time as this matter is resolved our client is in the unfortunate situation where he cannot camU. t himself to any future planning in respect of the Block.

It \oA:)uld be camon ground ~ presl..lll'e that the Block had deteriorated during the Johnson I s lease. It would be criminal for the Block to revert once rrore s:i.nply because a question of reinburserrent of legal fees has not been resolved.

If the Depart.rrent or Maori Trustee dces not intend to reirrburse Mr. Hovell \file YOlld like you to advise u& SO that we can consider any further actions we might take. If the Maori Trustee is going to reirrburse Mr. Hovell we would like to know to what level that reirrbursement wi lJ, be.

Cne way or another we would like to have the IMtter resolved.

We \oA:)uld be pleased therefore if Mr. Ferris could give his urgent consideration to this matter.

Finally we \'.OUld point out we are aware that during negotiations over the Court case and during negotiations over settlerrent Mr. Vbods spoke to the Maori Trustee Head Office which we understand to be in Wellington. Presumably the question of restitution 'for legal fees was raised with the Maori Trustee in Wellington and presumably it should be docurrented sarewhere on one of the many Papatarata A2 files.

~ look forward to hearing fran you at your earliest convenience.

Yours faithfully,

RISliWJR'm Wi\LL & MA'rnIESON PAFW:JA

25/83/1999 15:28 54-5-858-7483 PAUL C ERICSON PAGE 84

11th August 1986

lDVELL:

Basically after the rna tter was settled which was at sane stage on the 4th August

1986 I went to Court on that day and spent about 45 minutes talking about set'tlement

proposals. Since then I have had a couple of discussions with Sandy Hovell and

also with Tan Woods. As far as I can see the tenns of settlement were that there

was $27,500.00. agreed to be paid plus the land back. T:i1ne was of the essence.

Balance funds to be paid in Noveni:>er. Serre funds, about $5,000.00 paid and the funds

held at Court. There will be security over freehold lands for the balance. Maori

Affairs to meet legal expenses, Sandy to get the balance over and above expenses.

Maori Affairs have paid about $13,000.00 to date. Have to consider options before

they made this offer and basically Tom Woods tells me if they hact forced the

bankruptcy of the estate they would just have to stand in line behind the secured

credi tors and get nothing so it seaned to be the best way of settlemen1:. In my

subsequent discussions with Sandy Hovell as to future proposals for the use of the

land Sandy says he can either have the land rent free for about five years, he could

try to partition out his interest in the land or he could buyout the other

shareholders. ! suggested to Sandy it would be better to get this in writing from

Maori Affairs before \ve made any definite decisions in the matter.

As far as attendances involved in this last Court appearance have been there were

morte bits and pieces of correspondence then the Court case itself I went about

three days but only for about a maxirrMn of 30 minutes on each particular day. Sandy

was just really me 'to keep a watching eye on things again and I pointed out to hbn

tha tit was a waste of his t:1me and mine for me to be there too long. When I receive

a reply from ~bori Affairs I should get in touch with Sandy to discuss options.

OUR REF 52/486 (GS)

YOUR REF

OFFICE OF THE MAORI TRUSTEE

WANGANUI

3 March 1993

Messrs Wilson Barber & Co Barristers & Solicitors PO Box 109 GISBORNE

Attention: Mr R T Hovell

Dear Sirs

PAPATARATA BLOCK : R D HOVELL

WITHOUT PREJUDICE

5 MAR 1993

This letter will serve to confirm the writer's recent telephone advice as to settlement of this matter. It is proposed that settlement be effected as follows:

(a) That the $34,305 received from the Johnson Estate (or so much as is necessary to repay the Maori Trust loan) be treated as credited to the Hovell Maori Trust mortgage account as at the date this money was received from the estate of the defendant lessee.

(b) That if the $34,305 is insufficient to repay the Maori Trust loan debt plus interest as at the date these moneys were received from the estate of the defendant lessee, the balance of the debt be written off.

(c) That the Maori Trustee credit the $34,305 to the Hovell Maori Trust loan account without debiting the block account and that a write off of this amount be made. As you know, this money was applied in reduction of the owners debt on the block account when received from the estate of the deceased lessee. The position will be treated as unchanged in this respect.

(d) That Mr Hovell execute the lease of the property back dated to the original intended commencement date and pay the arrears of rent under that lease. The lease to be at market rental without abatement and the rent is to be applied in repayment of the balance owing on the block account.

2.

The effect of the foregoing is, 6~ course, that the Maori Trustee pays the $34,305 from his own funds to the benefit of the owners in the block taken as a whole.

As discussed, negotiations regarding the terms of the lease of the block should now be completed.

Upon receipt of your acknowledgment of this letter, the necessary adjustments to the Maori Trustee's accounts can be made subject to agreement being forthcoming as to the terms of the lease.

Yours faithfully

(I J Hyslop) Regional Solicitor

PO Box 3036 GISBORNE

14 June 1993

The Maori Trustee Maori Trust Office PO Box 436 WANGANUI

ATTENTION: MR IJ HYSLOP

Dear Sir

RE PAPATARATA BLOCK - RD HOVELL

We refer to your letter dated 3 March 1993.

"Without Prejudice"

Our understanding is that the proposed settlement referred to in paragraphs (a), (b) and (c) represents the position as we have understood it to be concerning Mr RD Hoveit's legal costs and refer to our letters addressed to the District Manager and the District Solicitor dated 6 March 1989.

Subsequent correspondence confirmed this position. We enclose a copy of our file note dated 9 October 1992 for your further information.

We refer to paragraph (d) of your letter. Before executing a lease of the property we believe a Meeting of Owners should be convened to obtain confirmation that such action is with the consent of the remainder of the owners in the block. We are concerned that the last Meeting of Owners was convened prior to the expiration of the High Court case. Only two other owners, apart from Mr RD Hovell, were present at the meeting and they only represented a minority of the remaining shares. There are also the questions concerning:

1. The prospects for compensation for the loss of native trees felled.

2. The Maori Trustee's administration of the lease.

3. Payment of Maori Trustee costs.

4. Whether the block is to remain under the administration of the Maori Trustee.

- 2 -

5. The ramifications of the provisions of Te Ture Maori Whenua Act ·1993.

You will appreciate that we are anxious to resolve these outstanding matters. To this end we will attend to the calling of a Meeting of Owners as soon as possible.

We would be pleased to receive your comments concerning the above matters.

Yours faithfully

Mr Ray Hovel!

th30192

f "r-;~'~-:~,\L,((i.'T} .~~ ~~. LJ ~ . .-J ~J'A'L.J i ------J LJ ~ LJ il~ LJ k~ .~~~I

·v '-' , (Ai>ProvCd by the District Land R~. Wellington, r <·73003)

-.MEMORANDUM .OF "LEASE -;]-;:.-;s.::~ i2i;-":::.!-~~?, '0;".: -;:~"'::. -:~':-: :~~.:. • - •

. ; .• (0. Pait.XXI~ ofth': Mao~ Affairs Act 1953)

.~~~~~;-,.,uv->" .......... eSare r~t~tit fu. the CertifiCate of Title (ProvisioDaI RegisterYhereiriaftermentioned(hereinrs") are:registered as proprietors of an estate in fee simple as tenants in i:omnionin Unequal shares sUbject .

= liens and interests asaie notified by memoranda underwritten or endorsed hereon:inall' that ;Lcnd°-])ist.ric·!;'· . ,. .' -' .. "'of··Gicoor.rre .

_h~:~~ :: tt: i0A~:~.T}:Oi·2'::::Kto :d::i::~e. scri beu.: in·,Certific~te' of"'.ri tIe VcIuI:-ie

"---.-.. ,'

'--,: ."( ..

::..--/ .:: -i: ~

wher~ fue .;uii m;..a ~ Maori Freehold land or European land owned by Maoris And whereas- at a meeting of the :~.assembled owners of the said landheldatGisborne' on the9tltlay 0!lecembe:!'966 at which meeting

'.at least three persons entitled to vote were present during the whole time of such meeting the said owners by resolution duly . passe9- in accordance with law agreed to the alienation hereinafter appearing and such resolution' was duiy confirmed as by

1185 , ~'i'a./ ~,

law requlred.And whereas, the Maori TruStee is duly authorised to execUte this instrument of alienation as agent of the Owners under. Part XXIII of the Maori Afihlrs Act 1953 And whereas all statutory declarations required to be made all .

L' 8'=. ,!-':k.rt' - f'" .

. notices required to be given all steps matters or things required to be taken or !lone and all times required to elapse have been ~c... InT

so made given taken done Or elapsed so as, to empower the execution of these presents Now therefore the Maori Trustee by ~~J!:c..n-.-vlrtue of the powers conferred upon him by statute and any other power him enabling doth hereby execute thes,e pr~~ts_, _ . as agent of the owners for the time being and as such agent DOTI! HEREBY LEASE AND CONFIRM unto ~l:~ ~::A.:::C_\. Ti.lri·ti~:i ... ~·~::r~"'ict1 ;701:::-..n '~-::TD t3:!(i.':E ~:_'r:~(.::. ::l;~c· l:11GI7~!_ c:s 1T.s::'<'~!..:l:::!J ;~_'~~CL 0~- ~!i~.:j __ ~i~:i1 (hereinafter with hist::lCi::executors adrn;Wstrators and asSIgns referred to as "the Lessec~ -nyan-the said land to be held by

the LesseeS as . tenant for the t= of t,7Gn'cY-022Cyears from and :including the first day of

of ..: . ::"~,e:r

1-... j

tl

....:l...

~-I--" IL I c_~ c I: I':r': , r~I~ r~L r~r~ r-r-r--r'I'

I :1. i rL-.J '. J 1_1 ~ .

..

~

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H ~'.~ .

I .. L __

r-the LesseeS as tenant for the term of -t;·::en·ty-ul':!.Cy= from and includ;~<>: the first day of

:~:C":::. 1907 yciicii!lg ~~d paying thereI1..

(a) For and duringthe first l;cn ~ of the said term the yearly"rental of t·.-;o :·~1..~'ld:cc(l :::::;11:1 :fifty-t,,;!O dcll-:::;.. .. s ',' , ';)252

,y= of the said term a yearly rer1taCC;UcuIa~.on the basis of jb) For and d1lI'iI2g the next cleven si:: cloll:::.rs pounds per centum of the 'C;~',:;;i tc.l " value ~i~;h-~said land ':Ccorcllilg:

itO a :;peeial,Govci-nmentvaluation of the said· land- to bemade'at the expense of the le;S~ iIi tl:ie'month of : ,'. ..- . . . .. -':"":. -~: .. -::..-~:. - ~~.,., -.-., ...... -~;;.~-::

(-;" . G

. I.~~~;~~~1Jgll·i~1.-. ·.~h~ ~iJ.G~·e:~~;;t~6:.~;~J.~i~;c c'~~r;:I~~:f~~¥5K;~t~~~~l~~ti~th~~t:""cc~~ Provided that such rent sIiall be not less than the rent received for the preCeding' . '. __ , .. t en :':'-:.:.;' ~.' o)'eat. subject to followlngCoyenantsconditionsandrestrictions~' " .... '. " -- '-.- "-. -- -"'-.~::-;'., .

• AND-THE LESSEE DOTH HEREBY COVENANT wiTH THE LESSORS AS

1: Thanhe L~'~ P'':Ythe.ierith~bi:res;i:d·.by~q~~:~-yearIY~~~"~~e.·:;;;"'S,,,::;,*~_:':~~0't1:'f:; . De-cenber J: and . ~-: . ~ J\~ie~'

. --.,:- :...-; .. -'~

. Gi~~OOl~le --':;.' J;~_

may from tinie to time direct and will at the ~e'~: pay :~~:~:~ equal to . __ :". _"", ___ :._~: -~':'!"i..:.+ .. ;7;:::-;-:::> .... --::_:_:.-'.!,~~:

~ourit of the half-y~ly~ntal which amount shail be iet3lned by th.e Maori Trust~e as his comi:nlssio,,;:or !,~y~","-"~'"

:" .. ~";.~~t.::~~~~ ~:te;-the ~dte'~=d·"'a~d"whe!l_t;':~m~ .. ~ ~ome~'alie a.;dpi~~~~f.~:!i;~2¥g~~~~i ···~I·:S~~&=)~F~~~=':~~~~~~~~\~~~~ ~IT!;W~~~~~~t;.than~~~nUJ2~;~.(~~~~V~ .' and the Lessee] will p~y ~;:.'.cir proportion thereofwhetlier ornot the same shall bedue and paya~le ~ _. . _ .... _ .. . "'_' ._ :.~~

. 3:ti!:~:~~~~n;tS;~~~~f~ ~~1~:iY~~~ ~~~~~~~£~i~~Fi~ff~;~~~!;~~S~~~:·3· . that stich consent shall not be unreasonably or arbitrarily Withheld in the case of a reputable and solvent assignee sub-tenant·O:::·.··C",,·.- .:. .... .

.\\. or ;'~:S~:. L~~)~ With~iwoyeari 'of the c~Dmlen~~t~Lthe t~ of the. ~thinclease-erect-and put upo~ the .•. ' . .~&) ~~~~ot-i;~ -' '- -bou;,ruiricSofthe liuid liereiildemiSed or-upon ruch ooundarics upon which no substantial fence e;cists a~.Jfficient, fenee":-- ----:-'-K.,,---= '10'07';: ..

: Within the meaning of the Fencing ~t 1908. .....- '. . .... ,\ " c' .>., -. 5:' '1.ba1: the £esseeo will at ail tiines during the continuanCe of the said t= repair and keep and, maintain in good and

substantial repair all buildings and other erections fences gates hedges culverts dams drains crossingS fixtures stockyards and every description of improvt;ments now or hereafter .stan.ding 'or being upon·or growing on the' herebi demised land. and will reneW all such parts thereof as .shall become 'decayed or unserviceable and will at the end or sooner &tamination of the said -. t= yield up the same.in like good order and condition and.the Lessee will during the said t= and at intervals of not more than five y= or if and when required so to do by the Maori Trustee paint.!!' a workmanlike manner all the outside (including the roof) woodwork and irQnwork of all buildings now or hereafter to be ercctedupon the land hereby demised With two coats of proper oil colour or synthetic paint suitable for use in the locality. . . .

-f"~ •• :<:.~

""

~_J~-r~~~_~J;-:;:_.~be~ b8~~ ~. )keep ~tt piill ~ ~ IIaJIlJ pgsl .-n= F= ~UI-~ r-. _ ~ 'rl:ne ~.. ae d& '~'·;l~~.Jt"e'~ -!?ftl_Jessml_1s th, ~.ori ':\_ .!£slL-l~L bmel ~bn- L-.J ;1 1lIiI..

slble msurancc .office In ,~cw ZealaJ... ____ e appr y the Truste [l the , f tl:ie s ilaIDgs .. .0£ L..! R

r

them being destroyed .or damaged by fire (but "I' bject always to the prior rights .of any martgagee of the sala mIld) au llluueys .teccived by the Lessors under and by virtue c • such insurances shall farthwith be expended by the Lessars in reinstating or repairing .the building .or buildings so destr, )r damaged prorided always that the Lessars shall in no event be bound to expend in reinstating or repaUing such buildinj" .or building any greater amoUnt tJ;1an that received by them as the proceeds

"J-/Z::~l . ~.~

-- ~'>i;~~~~L' -~;~-:. ".

of such insurance.' ~' . '. ':>.:' ',.

7. That .• the Lesse~ .wJP.. SUbje.ct to any express modificati ;' ·~.:Y~ ~~'hi;~er co. '.ntain. ed. .laY. do~ .the said land j~ good English grasses WIthin five years of the commencewg , :a~'lf [email protected],i)I 4w.wg.tb.<eteF,w.cu!tivate use and manage such parts of the said land' as .now are or shall hereaftd"'lJ, ~e;r"Up 'aliff c&.'vene);t!into.1i1lage in a proper and husban,- .

. like'manner and will·notinl!,overish.or Wl'.Ste the S3lIie but . l!:eep, the s.ame in'g~ ~and.condition and will at the end .c. or sooner deteriDinalion of thet= leaveall:of the said land'~ddown ill good.: perI!I,rulent English gt'asses and clovers .of the

deScriptians andpropartianS tisuallysown in the district 3.nd ~~ble.for·the~a .. i .... ,....... .' ',' '.' ~: ~., ' .' -.,. . '. . a; That the Lesse,,; will use the most approvedmadem meth~ :to sU'ppress ii;'d eridica~ all noxious weeds and plan~'

.. ':~::. that are such by law from time to time in the ..iistrict in which the'~ai(Uandis situate growing 'on the said lind.or upari the ".J". near half of any adjoining raad and will grub up and destroy all garse grawing as afaresaid athecWise than in .or upan the ':'. true line affeIlcewithaut cantribution from the Lessarsand will duly and punctually comply with all directians .of the Lessors

the Maori Trustee as, to the methods to be used Or otherwise and alsa with all the provisions of the NaxiOus Weeds Act aud all amendments thereof and'regulatians made thereunder respectively provided alwaYS that the Lessee Shall have.

__ .",_ ~..< . illnagainst the 'LeSsars in' respect of reasanable expenses mentioned in section) 0 of the said Ac:t and the Lessee. shall ;~,.·f~i':~::.:;::~4fi·indemnify the Lessors against.all and any co~tributian or contributians costs charges and expens'eswhich·the Lessors may be' ~'.' ,~ .. - ~~ed upan .or compelled to pay under the =d Act.' • . '. '. " .'.

9~ Thatfue L6seeS will ~t ieast~nce fu eVery y~ .of the said term clean and op~ all ditches drai~ and wat~rcourses on said hnd and will keep the same clear and unobstructed at all times during the continuance of the said term. . . ''l'h~~~ the L~~ 'will';;t at~y time during the t= h~bycieatedoverstock the ~d la'nd ,and.will nat during the

::ix, of the said t= depasture upan the said land a greater number .of stack than· c he ~rshall, have had depasturing the said land dUring the previaus 12manths of the said term.. .

Thai ili~ Lessee~sWill wbil~ ~ the ~d ~d as a dairy farm in all respects comply With all thepravisiansof the Dairy _ .• __ try Act 1952 arid its amendments and every Act that may hereafter be passed in amendment'thereafor in 'substitutian

. therefar and all the rules ana regulatians made or to be made thereunder sa far as the same relate to the demised premises ." and under no circUmstances shall the Lessors be liable to payor to contribute to expenditure by the LeSsee on buildings '.' or othedmpr.ovement3 upari' the demised premises natwithstanding thepro'Jisians .of seCtion 8 of the· said Act .or of any Act . that may be passed in amendment thereof or in substitutian therefar. . ' '.

~- -12: 'ibtih~L";~ s.cill ~~~ 'at ~y&;;~ a~g the ccinn;uance .of the term hereby. created ~thautthe written cOnsent , of the Maari TI1lStee' first had and obtained request or permit any electric power Baara .to .install.any motor electricWil'es

electric lamps or' citherelectrical :fittings or equipment on .or abaut the prerrriSes hereby de~ed .or to· do .or cause or permit ;.' ,to be dane any act deed matter or thing whereby any charge under sectlan 119 .of the Electric Power Boards Act 1925 or any '.' amendment thereof shall or may be created upan the said premises in respect to the same_ .

-13. That the tessee Swill fu. a 'husbandlike ~erand'at the prap'; seas,;n far sO'doing in each year' topdress so much ofthe.1ind herein demised as shall be laid down in pasture with artificial manure suitable t9 the nature .of the sail arid of a quantity normally used in the district. . '. .

14. That the Lessee] will not during the said term take .or permit .or suffer ta be taken fram the said land or any part thereof more than three craps ather than grass in successive years and will at the expiratian of the said term leave the said land laid down in gaad permanent English grasses and clavers as pravided by clause 7 hereof.

15. That the LesseeS will atJm;(;::Ci~()wn ~st and expense do all things necessary ta camply with the pravisians .of the Rabbits Act 1955 and of any Act or Acts passed in amendment thereofar in substitution therefor and to keep the said land free and clear of rabbits and other noxious ver.IJ?in and \.yill jndemnify the Lessors against all and any contributIon 0;- !:o.ntributiODS ccsts charges and expenses which. the Lessors may be called upon or cOinpt:lleu. to pay lli .... l(icr snch ;\"ct or .';ClS.

16. Tha~ the Lessee'; will nat allaw pigs to raam a: !~:!,:,.o:cr._~e said land but will at all times keep them in praper pig-

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17. That the Lessee fCwill pay all costs and expenses in~rred in the preparation and completion of these presents and all costs and e>.-penscs incurred by the Lessors in relation to any notice or any proceedings under the provisions of the Property Law Act 1952 and its amendments relating to forfeiture and relief against forfeiture (notwithstanding that, and whatever the means by which, such forfeiture may be avoided). .

18. That the Lessee:; will keep any native bush or shrubbery shelter ornamental or other trees at any time growing upon the said land in good order and condition and will not without the written consent of the Maori Trustee cut down damage or destroy or permit to be cut down damaged or destroyed any of the said native bush shrubbery shelter ornamental or other trees at .any time growing on the said land and will use all proper and reasonable means to preserve the same and will not remove or permit to be removed from the said land any fencing posts timber or firewood Provided h<>wever that the Lessee S may use for:ms~i-:8i:own requirements on tlie said land for repairing or erecting fences and for firewood any logs or dead . timber on the said land. . .'

• 19. That !:he LeSsee S will not call ripon or compel the LeSsors to co;'tribute to the cost of erec~ repairingorInaintaining' . any boundary fence which may now or hereafter be qected between the land hereby demised and any land adjacent thereto

of which the LesSors are the owners Provided alWays that this COVf:nant shall not enure for the benefit of any purchaser or :-: Lessee from !he Lessors 0\ suchadjacentJand so as to deprive .~e. said LesseeS of any ,rights he would have. (b~t for this .~

.... ~CO;:=ha=:r;:~~th::i~ ~;:'::;~j:~:= Z~~ ':ri :~~:;~~"~l;~~~~~;~:t' . visions' of the ForeSt .. and R,ural Fires Act '1955 ·.and. will use every care .andprecaution to prevent· fires from spreading to .

adjoining propertieS and will'indemnify the Lessors against all claims for damages caUsed by any fire lit by the Lessee . or .. his agents and so spreading as afores~~ and against. all contributi~ costs charges and ~enses ~ \V~$.!!t~ ,J:.~?~}~~)' be compelled to pay p~tto the proVlSlons ofthesald "o.ct or othermse howsoever, ,,', < ' ... : •. ;:."'" '0.'.:' <: ,.,.,

'" . . ......... , -". -: '-, . ". . ... - .. , '-.,.-- -.-:-" , '. MTD TIlE LESSORS.,DO HEREBY COVENANT ""ITH THE LESSEE ,AS FOLLOWS:'

21.;-That the Lessee:havingperforIned and observed the covenants and~diti.OOs:on his-": part·hei:eiiJ. contained or implied shall be entitled on the terminatiOn by dRuxion of time of the tmife'r.!bY_~ea:\Cd.~UnlesS :'- ~':"C;:led term be ,crea:ted~ as herem. . afte.rappears.__ an. d in: si.t~ case . he . shall be entitled on thtr:;'.. ~~o~ b)." dR. o~.' ~.~ o.~~e. ~1~1.!9'~~<;Ile,:"ed term). to su~ sum by way pfcompensatl?n as.shall be equal to' . '-, '.' f. ! !"."<.. < ,.,~.:, .. """'\.:"." -,:C,,,,,,,:,'''-< .. pounds::~ , per centum of.the value as determmed ill the manner heremafter pr . ded of aJIlII!Prov.eri(ent;' of the kind more particUlarly <',c"

, s~t ~lUf:in the Sche~ule heretowhichhaye~een effected by the Iqf~ ~~d,;wlllch 'f§ ill '9stence,onthe ~~ ~d ~tt:?':» ", exprratlonof the; SaId term.or at the exprratlon of such renewed tenfpr~y:t~~9-;J:1()v;gv;¢r ,~t W' respect of bUlldings .no coIl1-;~'o,:::~.: pensation shall be payable unless the Maori Trustee has previously~_tli\fX$~"'~ thereo-&aRP~o!/d of the plans and.spepJications -,co- .

therefur., ~-- "':J;,~~~":':.9' -",,' , . '.' , '. 22 •• That for the purp'ose of ascertaining ~e .amow:lt of the compens -'O;!i ~ll£sb- . e~essee . is. ~ entitled under the:_

.... : '7 . foregomg clause· 21 hereof the value of the SaId unprovements shall be de a special valuallon to be made by th.e .' ,. :~: ':', ~ '. Vo.luci~G~~"]'k ,,~~~th thiprovlMOli 1l(S.~ ~ :ofthc M~Qri.~ AJ:! !~l~g£h!! f.et? for~h_Y!l~ti()~ /':J\.< shall be borne by the~ee<,. .'. .."~:- .' . ,',""". -- •. J . . 23. That when the Lessee. proposes to make on the said land any improvement of the kind referral to' in clauSe 2i hereof'

.. he., shall be.entitled on application to the Maori Trustee to· have particulars of the nature of these improvements recorded

Delete uno right of rCIlC\~

in:the manner presCribed by snb=tion 4 of=tion 249 of-the Maori Affuirs Act 1953~ . ,

24. That on the request of the Lessee by notice in writing to the Maori Trustee made n~t les3 than six months nor more tn:m. nine months before the expiration of the term hereby created and if there shall not,at the time of such request be any cxlStmg breach or non·observance of any of the covenants of the part of the Lessee herem contained but not otherwise the . Lessors will at the ""-pense of the Lessee grant to:m:,,':;" ::i:.a lea.<e of the demised premises for a further term o,i; '::c n:t:r - (m,e years from the expiration bfthe said term the Lesseec yielding and paying.therefor .

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ten (loll~:l>per centum of

the C::::'i t~-:.l valuation as ascertained by ... "ecial Government valuation to be made at the expense 'of the

Lessee in me'mUnth=uf 19:,,7

, pro;;;'ded that Such rental sball -be not less than. the rental reserved for the last el even years of the expired t=.

. ". .. .' ~

For and duriDg the next eleV8l1 years of the saicitern;,ii~early r~tal equal to st~: per centum· :,~ , '.-

c::-.:;.~if::l . valuation as ascertained by ~ special GOVerIlmellt ";aluatioD.~bi: made at fueexpense of the

iri the monthi of _. __ '.' '._ _ ._.. .... __ ~9;: ~~~~.:t~~~~~~l:~o~;,;;~~Y-t;~;r~:~i~~~S -~ffcctcd. that such rent shall not be less than the rental for.thepreceding -_-, -_ton

II (::\"""Cl'lDCr

Years

~_theIike covena~ts and provisi~Ds as ~e herem co~tain~ excepting this pr~ent ~veDaritfor renewal.

-Th~ Maori" Trustee may at all ;..",sonable times during the continuanCe of the terri:J.hereby created enter upon the said -any ag~t_.officer or servant fo~ the purpose of viewing the state and condition thereof and of the building and erections

- .-That ther'e-are hereby e.~epted and re;erved from this demise all milling tiillber, flax, coal, lignite; stone, clay; kaurind other metals or minerals whatsoever ill or upon the land hereby demised, with full power and liberty to the said

:So their agents, servants, grantees, or licensees to enter upon the' said land for. the purpose of searchillg for, working, ,wlllIlmg, getting, and carrying away all such inilling timber, metals, min~, arid other thillgs soieserved as aforesaid, and _

:. this p:urpose to make such wads, erect such. buildings,. sink such shafts, arid' do all Such thillgs' as may be necessary:'ovided always that the Lessor.; shall pay a fair compensation to the. Lessee;..for all loss. or daniageS\lStained by the Lessee

by the eXercise of 3Ily such power.; by the. Lessor.;. The amount of any Such compensation shall, ill default of agreement, be determined by two arbitrntoI> and in case the arbitrator.; 'cannot agree; by their umpire; ill accordance With the proVisions of the Arbitration Act 1908; and these presents shall for the purpose be deemed'to be a submission under that Act: _

-,.:' -- 27. That if the' LesseeS shall 'at any time make default ill the penoI"I03nce of any of the cove~ants, conditions, or provisi~ns on the part of the Lessee herein expressed or implied it shall be lawful for the Lessor.; (without pn,judice to any right of re:-=try or other right) to perform any such covenant condition or provision on behalf of the Lessee (and if neCessary for so doing to enter upon the said premises) and3ll moneys paid and expenses illcurred ill so doing and also all costs illcurred by . the Lessor.; ill connection therewith shall be forthwith repaid to the LeSsor.; -by the Lessee together With illterest thereon at ' the rate of ten pounds (£10) per centum per annum and sball be recoverable by distress under the Distress and Replevin Act 1908 or otherwise as if the same were rent in arrear hereby reserved and it shall be lawful for the Lessors or the agent of the Lessors at all times for the purpose afuresaid and for the purpose 'of viewing the demised premises to enter upon the said ,premises with Such workmen and other per.;Qns as the Lessors or the agent of the Lessors shall think :fit and to remain there for such time as ill the circumstances shall be reasonable and proper.

28. That in case the rent payable hereunder or any part thereof shall be unpaid on 3Ily day on which the same ought to be paid and shall remain unpaid for one month thereafter whether the ¥IDe shall have been ,lawfully d~an~ed or not or "in case the Lessee:::; becomes bankrupt or compounds with or assigns his,:·' :::' estate for the benefit of his:" ':: ,_ creditors or in case of the breach non-observance or non-performance by the Lessee. of any Covenant condition or restriction herein on the Lessee's part contained or implied then and in every suc-l-t case it shall be la,,,ful for t..'IJ.e Lesson fo:rth~t.~ 0:-~! .e.:lY -:lr=.=: ±c~c-'l3..ft.t:.r ""'thoUi: r.otlce or snit oTh~r th:m ;"In'\.-- nrrfTrt:" rt"'nn;,,"'.-1 to 'hr ...,.; •.. ,..,.~ 1 ........ r~"""r.~ r.r, .1,~ --- ... :,..: - -.~ ,r -., ":.-" __ 1 ~..... .- - ~ -.

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I I I \ I Act 1952 , .. , .. l';-'-;p-~";-;~i p;'; ~fili~;,ridd~~di;;';:d j;;. theo~e-~ith~-;h;;l;; lereby to determine tbe estate Lessee under tbese presents but without releasing tbe Lessee~~ from liability in r,-.-<oct of any breach of any of tbe said covelJ.ants conditions and restrictions,

29. That the covenants powers and conditions implied in leases by the Property Law Act 1952 shall be implied herein .except in SO far as the ~ame are hereby modified or negatived.

30. That any of the terms conditions or provisions of these' presents which are not <::<pressly or impliedly contained in or covered by the resolution of tbe assembled owners passed under tbe said Part XXITI of tbe Maori Affairs Act 1953 Or the conditions of confumation thereof as hereinbefore mentioned shall be deemed to be t=s conditions and provisions which have been agreed upon between the owners and the Lessees. .

31. That no compensation shall. be payabl~ to the LesseeS in respect of any improvements effect~d by him theupon " the said land during the term of the within lease. ... '. .

32. The. Lessee will~ on \TI'i ttendemandbeingmade of· the Lessee by any orie .. ,.'. or more of the Lessors or by' his s=elFE=~=tJ=I;:Eher 'or their duly authorised :::::::: ~~gent . or by the Maori!rustee forthwith produce. to' the person. making such .demand. ' .. -.. :~_; :P:t ~he addl'essin New L.ealand .:specified 'in such dem~d and fcirins:gection by ~! ::

:" ····'~>UCll person the policy rela:ting to. the fire insurance herein mentioned. together: .·>'-\,,{i t,h any receipt or. receipts, for'arIy premium or premiums .payable with reference

:'l"ti?FUch pOli<:y~~. ......;:... ...... ' '." :;(;'_~ ', .

. ' .~~ ~~":-~;;;+~; ~~~i~~~~=~,,~;~~;=:;~<1 \"[o;l~,n ::nd STC;IS ~LlC;i cJ,s~' r~rtC~;1l/:~8 acrepttliiS iease ',,1 tlie aDove~aesCdbc,a IaIi'a to he held by me as tenant

"restrictions above set forth.. c' . .

~~~ ;.w .~ A • ,.

.'. .

.:~~4! eol... 19G7 day of

Signed by the Maori Trustee ".. 1 .D ,T" '" _ -" The Maori Trustee

bY~=-tL "'<~cr ~.."r~"" - by -y-acting for !he Maori Trustee p~uant to sec~on 9 of the Maori ,/'- . ~ ", .. " . ~'-'~_,. Trustee Act 1953 and sealed Wlth tbe Maon Trustee's Seal of .' . :c,.··,-4 . J .. U >-~

// ...... _ . -_ J- "

: office in the presen.ce. of; .. " , . ': . -'. r acting for ~e Maori Trustee Iiursuan to S~c;tl. ~ on9~'.., ~\ ." . ~>;'--;/~~.. of the Maon Trustee Act 1953. . ~/~/~~i5;\:;J:./)'~'

Slgnature;·-- . . ., '.,. ~'1;;'J:""; .<~ I ~l . ~. ".. - ~ . ;.. . .' . .... .J:;.';~""":~f/:j,j /: .

. . Occupation: -. ~~~~-: .. . I\t-':"'~~~~~~ .~. -;

•• ~~~7-;u '"~o:J"A~:E::::O{?'~"l=~!f!Jc' Occupation: .• ', /./. ~ I / ':'".J '"" j

• ).: •• ~'~.I". :;,~ ......... " ./ -Address. _________ ~,_~" ______ _

: L-;;·~":'-":': {..~;"_Lo: __ 0: ..... _.~ •• _. Lessee .- ~~. -,. ......

M.A.712

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No. LEASE

~.~.:.

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District Land Registrar. -Assistant

of the District of.--~------.---.----- _.-. __ .-

Correa for the PIUPOSes of the Land· Transfer Act.

Solicitor for the Lessee.

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1M 18/130/2

THIS =,EE:D mo.de the day o~

One Tholll3ond nine Hundred and Seventy Pour (1974)

BNr',rF:NN 'l'H~ ~~t\o'n 'l'RI:3'l'Rm (herelnn.rter called. "tho leB~)Orll)

of the one part and HAhi"iY J~H:!~ON of HUatorla, Farmer,

(herelnnftcr coIled lithe covcnontorU) of' the other po;r.,t

l'lHm:F.:\S the leasor 10 the re[~lBtered proprietor ot: the

lands described 1n the Schedule hereto Am: WltE:).F.AS the

enid Inndo ore nt prcocnt h~ld an lCQfie by ~IIIUA RAROA and

ST(lrr:·; :'N~()A alao \cnown os U":!'O!!A'l'L' nA!~CA (herelnaL'ter

culled "the lCB!Jcea ll ) um.!el' ~nd by virtue of the Memorandum

of' Le:l'::c deoor! bed. in the co1d Schedule ANI .. IH~:';~AS by

AI7reement tor Snle nnd Purchase bCD.rln~ date the day ot:

1974 the lecoces ncreed to transfer all

their eotate and inlercat uncleI' and by virtue of tt.le eaid

l,~emorandum of 1.csee to the Covenantor Du.bjee"b inter alio.

to the conoent 01' the leeBOl' to Buch tranefer AIiL 'i,Ii?:U;;'J\S

the leaeor haa agreed to eo COlloent conditionally upon the

payment or all RrrCB1'a of. rent. nnd rates and to the coveno.ntor

executini3 these presents no,', '11tI3 l)lo:~~D ~"lITm:SSr:J'H tha.t in

concic"!.cl'ntion 01' the premiaea the covcnantor IA/i'i! 1I'.;':::1;;X

GOVRN/\m1 with the leanor 'ae .follor;8 that is to Bay.

1, l'lfA'r the covenantor will throuchout the talAnce of' the

term cronted 'by lhe leO,"Be duly and punctually and nt the times

and in the manner in tne lco.oe provided. pay 0.11 rent and other

'money a by the lease exnrr soly OT' implledl,v covenanted or agreed.

to be pnid by the lcaeees thereunder blill. will alao d.uly and

punctually and .faithfully keep o~Bel"'Ve c~mply with and perform . all and every or the otipulat.ions .covenantG ncrdements terma

proviolona conLlitionB and 1"'eSL1'ictiona in the lease expr~oBed ,

.a·r il:1pliod and on the part of lhe leflocea thcJ.'eunder to be

kept and obaeI'VOd com~lied with 01"' performed in all 1"'es[)ccta

aD if' ~he covenantor wo,s th'.1 leo see under and sS such hila

,.:

!-------- ------- - --~--- ----

exeouted the lense f'lWVID!!:D JIO',jTI:Vlm that the covenant

by the cuvenantor herein contained Elhl111 not be deemed to

releaf~e or sfroot any wo1vel' of or olhcrwlse affect any

liability or obll~otlon or the leoaeea .fI'om any liab1lity

or oblll;lltion to pay llny ouch rent. or ot.hel' moneys or to

keep o1.cL'I've com; ly \Oil th 01' perform any 01' t.he Baid 8tlpula-

tiona covcnanto acr'cementa terms proylsiono conditions or

l'cSlrlctlona.

2. ~.ill:l' the covenantor will f/lth!n a renoonable period

remedy to the colla.factlon of the leasol's Bny breaches 01'

coveno.nt ;r:nce by th~ leoBccu or the covenanlerle predecessors

1n title at 1'.18 0','/1' expense ao t.he 8ame may be po1nted out to

him by the leasor or ouy 0l.:ent ot the leolJor Ilctinn: under 8.

deleglltion or authority from him and in particular willI

(.) Fence the demised lanti at the rllte of 2.3 chains per

annum until t.he boundary i8 adequat.ely tenced.

(b) Ulcal' croon end topdl'cce l£\t. the rate ol' 2 cwt. per,

acre) 26 aCl'CO per ar.z.um.

3, 'i'HNl' if lhe covennntol~ shall diapooe 01,' the Baid lends

01' lr.~lOC 01' oot;i[;!1 cub-lot. or port with thu pocGcDaioll 0.1' the

acid lando 01' nny llOI't lhel't"!ol' he will pJ.'ocure from his . purchoocr 01' purchODcI'Q OL' aosicnee or nsoi!.."nee'a 'n like

D:;:' D O!" C(,,.~tl,\;il' (ao hcrein contained) with the leDsor and

00' with each E1uccccdih,1 chan£Q of ownership of the said land

or chQfll;c of occupancy 01' tl,e Baid landa.

.9,

,

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(a) 'Iha l~nu - 1.11 that ro.rcel of land con~ . .llnlng 1~80 acres

OI\U 1 rood nnd .'mown n!1 JlBpntornta A2 Block.

(b) Tho I..enr..c bccrinc uutc lhe ~Oth (J(lY ot: l:.eccmbcr 1,)67

r.lOt!e bet'{,cen t,h!;~ 1.~(tot'l 'l'r'u\t.Cf: nD 9tOt.UtOI'Y fll"ent ot: the

O\'Il1lJ;l'O 01' I.bo:! lllw..i. j4\.=1'c1n nwl LUria Hnran and stone

l:nrnn nl( 0 jmo~~'n flO Ucpu\1otu :.01'011 aB leaoces.

III 'd"r~!'-'l~ '11\1'--':<'";' thcce pt'ef)CH~a 11:1'/e been eixccuted. thi8

day nnd yeat" f1rot he:::'~ 1nl')fol'e written.

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