Disputes Tribunals Amendment Bill — First Reading 
Disputes Tribunals Amendment Bill — First Reading 
[Volume:653;Page:2311] 
Disputes Tribunals Amendment Bill 
First Reading 
Debate resumed from 31 March. 
PAUL QUINN (National) 
: 
 Where was I with that speech? I think I had got to “Hurricane Hughes” at half back. We thought that he would be a problem. We reviewed a couple of extra tapes and on closer examination we found that he had been dropped from selection so there is no problem there. Of course in relation to the rest of Labour’s backline—I am sorry its backbench—our new protégé and wonder kid Nikki Kaye at first five will have no problems at all— 
Mr DEPUTY SPEAKER 
: We have moved on to the Disputes Tribunals Amendment Bill. I ask the member to address the question if he wishes to use his time. The House has moved on. 
PAUL QUINN 
: I am sorry; I have done so much speaking recently. 
I join with those who spoke last night in support of the bill because it provides an avenue that has been established within our semi-judicial process by way of tribunals to enable people—particularly those in small business but also others—to pay a fee and access justice when they are experiencing some difficulty or disagreement with another party. I am talking about electricians or plumbers for example who are sole traders and have great difficulty at times in trying to get paid particularly when they have contracts with bigger corporates. The process of access to a tribunal has been used and has very successfully been established as an avenue for assisting individuals particularly those in small businesses to recover payments or to have their day in court—but without the expense of court. We all know that courts can be very litigious places and very expensive particularly when a corporate has big resources and can confront a sole trader who has very limited resources. 
The critical thing is that the thresholds that are established in the Disputes Tribunals Act date back to 1988 and are way out of kilter with the real cost; they are way out of date. The bill endeavours to shift the threshold from $7000 up to $15000 automatically whether or not one party agrees and to shift the threshold from $12000 up to $20000 where both parties agree. During the debate last evening there appeared to be a difference of view—let me put it that way to be kind to the Opposition—about what those increases represented. I think Ms Ardern said the threshold was too high but I may be mistaken. I tried to reference the  
Hansard 
 but unfortunately it was unavailable. I think the member complained that it was too high whereas Ms Pillay thought it could be higher. I am sure the select committee will have an interesting debate on that issue and that there will be robust discussions. 
The important thing is that we are in the right headspace about lifting the threshold to ensure that it keeps up with modern times. The disputes tribunal is important because as I say lawyers can be very expensive particularly where one party is better resourced than the other. That level of moneys can be used by one party to drag the process out beyond the resources available to the other party. The bill is very good in terms of disputes tribunals; the National Party supports the concept of bringing this process—or dragging it if you like—into the 21st century. We look forward to the select committee’s receiving the submissions which I am sure will be robust but also very supportive of the bill. I think the main area of contention will be around the adequacy of the thresholds to take cases to the disputes tribunal. Thank you. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 I come to the Disputes Tribunals Amendment Bill as probably one of the very few people in this House with any experience—admittedly not personal—with the disputes tribunal. I venture I am definitely one of the few former lawyers in this House to steer clients away from litigation and towards mediation through the disputes tribunal. I come with a particular preconceived view which is that disputes tribunals are fantastic. This is high praise indeed but it is also a reflection of the fact that those tribunals are an excellent mechanism for keeping people out of the courts. 
Unlike other political parties the Maori Party has no tolerance of the obsession with building up the court docks and prison cells by getting tough on crime. We promote restorative justice systems and our actions in this House show that the Maori Party has consistently supported legislative changes that increase access to justice. It is our view that any real move towards increased access to justice is a community benefit and warrants our support. 
The key benefit in keeping people out of the courts is that it is a significantly cheaper approach for claimants not to mention the long-term costs saved to society. The process is mediated and as a consequence can be more restorative in nature than a court setting. There are no lawyers so the setting is more accessible and less alienating as a result. Rather than being scared off by the legalistic vocabulary people can actually understand what is going on; a peculiar concept I know but true. Another benefit that we consider to be of high value is the fact that there can be whanau support and/or advocates to talk on behalf of claimants if they are not confident to do that themselves. 
One piece of information that did not come up during the debate in the House last night is a more comprehensive analysis of who actually uses these tribunals. A survey commissioned by the Ministry of Justice as part of the tribunal reform project interviewed some 813 people both applicants and respondents who had used the disputes tribunal amongst a range of other tribunals. The figures showed that the key users of tribunals were more likely to be European with under-representation of both Maori and Pasifika; to be male; to have an income of $50000 or more; and to be aged 40 to 59 years rather than aged 15 to 29 years. That analysis was very informative in demonstrating some specific issues that clearly needed to be addressed in any reform process. 
Just to test my theory I went to the Maori Legal Service to gain a flaxroots on-the-ground perspective of how well this all works. In the last 12 months the service has had three clients seeking remedies with the disputes tribunal. None of those clients knew what the tribunal did or what to do to pursue a complaint. As a consequence the service needed to educate those clients about the tribunal and to assist them to write their application. In the end however the service was unable to confirm whether any of those clients had filed their forms as each of them thought the $100 filing fee was too expensive. There is no current ability to waive that fee at the tribunal. 
My suspicion is that the tribunal is not well known to Maori people. Perhaps it is not well profiled in Maori communities. I suspect that even the $100 filing fee is a barrier to access to the tribunal as well. I would like to seek further clarification from the Minister of whether the changes will increase the filing fees which will inevitably increase barriers to justice for our community. Also I note there is no concerted effort to profile the tribunal to Maori communities and I wonder whether that will also increase barriers. 
As other speakers have mentioned the purpose of the bill is to allow more individual and small business claimants to have access to this—hopefully—affordable justice forum by enabling a larger number of cases to fall within its jurisdiction. We believe the process could be improved by requiring the referral of claimants to community law centres where appropriate to assist people in filling out the forms and perhaps gaining better access to the law. 
The process is comparably user-friendly already—that is in relation to trying to deal with the complexities of litigation through the District Court or the High Court. But we in the Maori Party believe that the disputes tribunal process could be made even more user-friendly. Given that there are forms to fill out it would be helpful to have someone to explain the procedures and what needs to go where on the forms. This is where organisations like community law centres come in. We would like to see the court staff routinely referring parties to community law centres for help with this. Although this is done now on an ad hoc basis it would be a positive move for it to be a requirement where appropriate. 
We also believe that the process could be far more Maori-friendly. Disputes tribunals offer a mediated process they can be more restorative they try to avoid legal language so that people can understand what is going on they can have whanau representation and they are significantly less expensive than going to court. A tribunal may permit someone to be present at the hearing to assist the party in the presentation of his or her case if it appears to the tribunal to be proper in all the circumstances and if the tribunal approves such persons. In approving a representative the tribunal can also impose conditions to ensure that no other party is substantially disadvantaged. The tribunal either can help the parties to come to their own solution or will determine the dispute. Any ruling it makes is binding and will if necessary be enforced by the courts. All of these aspects are a very positive foundation for providing a positive way in which Maori can access dispute procedures other than the formal courts. Therefore the process is something that we wish to support. 
Aside from the general context that disputes tribunals offer to the legal environment the purpose of this bill is ostensibly to increase the maximum claim level. The last time the claim levels were set for the tribunal was in 1998 so it makes plain common sense that the relative value of this level has inevitably eroded due to inflation and the rising cost of litigation. Other speakers have canvassed the figures such as the increase of the maximum claim to $20000 but the point we simply wish to make is that we support the intention that the maximum claim level should be increased in order to restore it to the original level set a decade ago. The level needs to be updated to allow more people to use the disputes tribunal. At present claimants are faced with a choice of reducing the value of their claim facing the increased costs associated with District Court proceedings—which may not be a viable option given these costs—or not pursuing their claim. None of these options seems viable hence the reason for this bill. 
We need to maintain accessibility and to ensure that the level of protections is relevant and appropriate in order to ensure that the groups of New Zealanders affected by this bill will still be able to access the tribunals without unnecessary barriers being introduced. Every party to a claim is entitled to attend and be heard and to our mind this is the very hallmark of a democratic and fair justice system. However with some exceptions no party is entitled to representation unless the tribunal considers it proper to allow it and approves a representative. We want to ensure that the tribunal will continue to operate on its current basis balancing the required protections for parties against the need to provide simple cheap and fast access to justice. 
Finally the last set of issues that we believe are reflected in this bill is that the legislation will allow more individual and small business claimants to have access to this affordable justice forum by enabling a larger number of cases to fall within its jurisdiction. The bill should be seen in the context of the package of proposals designed to assist small and medium sized enterprises. 
ALLAN PEACHEY (National—Tamaki) 
: 
 I appreciate the opportunity to make a contribution to the first reading debate on the Disputes Tribunal Amendment Bill 2009— 
Hon Darren Hughes 
: Tell us about your dispute with Anne Tolley. 
ALLAN PEACHEY 
: I also note that the troublesome fourth former on the other side of the House has started again. 
This legislation is just one more example of this Government which was overwhelmingly elected in November 2008 keeping the promises it made to the electorate. The National Party now the Government promised to increase the jurisdiction of the disputes tribunals in order to reduce pressure on the District Court system. This bill keeps that promise. The disputes tribunals are divisions of the District Court so they are very very important bodies. Their jurisdiction is exercised by referees who are appointed under warrant by the Governor-General for 3-year terms and those terms are renewable. Disputes tribunal referees have the same status as justices of the peace in criminal cases. The proceedings of the tribunals are judicial proceedings. In general tribunal decisions are enforced as a District Court decision. So the bodies that we are dealing with and the increased jurisdiction that we are providing are very very important parts of the New Zealand judicial system. 
The bill has two main provisions. The first is to increase the maximum amount of claims from the current $7500 to $15000 or with the consent of all parties from $12000 to $20000. This is a sensible logical move particularly given that those thresholds have not been changed in 10 years—not since the last National Government did so in 1998. 
The bill does something else. It makes consequential amendments to a number of other pieces of legislation: the Consumer Guarantees Act 1993 the Credit Contracts and Consumer Finance Act 2003 the Fair Trading Act 1986 the Fencing Act 1978 the Minors’ Contracts Act 1969 and the Retirement Villages Act 2003. Just as an aside when we go through that list of legislation that has to have consequential change made to it we realise what an over-governed country this is. However that is a subject for another day. 
The raising of the thresholds will do a number of things. Firstly it will reduce the pressure on owners of small to medium sized businesses and individuals who are trying to collect disputed debts. This will allow more parties to access the tribunals and thereby reduce the costs to all parties of resolving disputes. 
It is anticipated that about 3600 more cases each year will be heard by the disputes tribunals as a result of this amendment than is currently the case. As more and more cases are dealt with by the tribunals we will have a system that is much more cost-effective than otherwise would have been the case. In other words the tribunals will for more New Zealanders now provide a cheap simple process with fast access to the justice system and in a forum that avoids the legality and the formality of the District Court room. An additional 3600 cases a year will be able to be heard in the disputes tribunals rather than having to go to the District Court with everything that that involves. 
The second effect of raising the thresholds is that more businesses and individuals will benefit because filing fees are significantly lower in the disputes tribunals than they are in the courts. No lawyers are allowed. That in itself greatly reduces the costs of taking claims. The fact that third parties like lawyers are not involved means that the cost of using the disputes tribunals is considerably less than New Zealanders have to incur when working through the courts. 
The third result of the raising of the thresholds will be to reduce pressure on District Courts. We know that there are major workload pressures on our court system. By increasing the maximum level of a claim and allowing an increased number of New Zealanders to use the disputes tribunal system less pressure will be put on the District Court system and that will result in more New Zealanders experiencing the timely delivery of justice. This must always be an underpinning point of the judicial system: the timely delivery of justice the timely hearing of disputes and the timely hearing of cases. I think it is widely recognised that not all New Zealanders enjoy access to that timely delivery of justice. For many New Zealanders the timely delivery of their rights through the processes of the District Court is not up to standard. This bill will take a small but significant step towards rectifying that. In other words one of the effects of the bill will be to speed up the delivery of justice not only to those who are seeking to use the disputes tribunal but also to other New Zealanders who are involved in the court system. 
Fourthly by making the enforcement of debt easier as a result of the disputes tribunal system small to medium sized businesses will benefit from the increased cash flow that results. It is interesting to listen to Labour members sniping away; it brings home to me the understanding and realisation that members opposite just do not understand the significance of businesses and the cost structure of businesses. I would have thought that given the outcome of the last election it would be wiser for members opposite to sit quietly and not show their ignorance. 
There will be significant and noticeable improvements in the operation of dispute resolutions as a result of this bill. It is just one more item on the list of initiatives that this Government has announced to help businesses and individuals. In conclusion I invite the House to reflect on this: the last time the jurisdiction of the disputes tribunal was increased was 10 years ago. 
Todd McClay 
: How long? 
ALLAN PEACHEY 
: It was a long time ago—10 years. It was when National was last in office. Labour did nothing for 9 years and now this afternoon Labour parrots away with little understanding of what this bill is all about. I commend this bill to the House. 
JONATHAN YOUNG (National—New Plymouth) 
: 
 The Disputes Tribunals Amendment Bill brings in changes that will allow parties to resolve their disputes in a more cost-effective manner. Unfortunately disputes are a part of life business and politics as we know in this House. Though we will never be free from disputes how we handle them is very important. A process that is simple easy to access and cheap enables people to resolve disputes and get on with the business of earning a living and getting this country growing again. 
That is why this Government is putting through this measure as part of our economic relief package during a time of recession. The last thing we want is to be caught up in a process that is toxic complicated expensive and destabilising for citizens and their businesses. Right now there is a gap that some disputes are falling through. The cases are too big for the disputes tribunal yet they are not big enough to take to a District Court because of the associated costs involved. 
Do we really want to have a heavily litigious society or do we want to seek a process of mediation when the costs of dispute resolutions are excessively high? When the level for resolution in a disputes tribunal is too high it leaves people feeling that they cannot access justice. It leaves people angry and dissatisfied about the issues they are facing. 
Part of the reason for people wanting to live in New Zealand and not move overseas is having a process whereby a proper and just resolution of disputes can take place that is not going to break the bank. We do not want people moving overseas to work because they feel they cannot do business in a just and successful way in New Zealand because it is just too hard. This gap is there because inflationary pressure has made the present maximum level of claims of less value. This bill brings through an inflationary adjustment to lift the maximum level of claims to an amount more in keeping with what it should be. Back in 1998 this maximum level was lifted from $7500 to $12000. This bill proposes that the maximum level be lifted to $15000 or by consent of both parties to $20000. 
If we do not make these amendments it means that the costs of recovering anything over the maximum amount of $12000 would incur the associated litigation costs of going to a District Court which would make it unviable for many. The result is that some people would simply walk away from their claim but sadly in the case of many people if they walk away from their claim it could put their business in jeopardy. There are still many businesses in New Zealand where $12000 to $20000 is a large amount of money. For many it would be the difference between success or failure or employing a person or not. Businesses want to spend their money on productivity and growth not on a litigious process of going to a District Court hiring solicitors and going through all the filing fees they would incur. 
We need to make the resolution of disputes more accessible simple and cheap. This amendment bill makes the disputes process more accessible. As my colleague Allan Peachey said 3600 more New Zealanders would be able to access this process than are able to now. 
Simon Bridges 
: How many? 
JONATHAN YOUNG 
: Three-thousand six-hundred more New Zealanders would be able to access a process to resolve disputes than are able to at present. The disputes tribunal offers that ability. It avoids the legality and formality of the courtroom filing fees are significantly lower and lawyers are not allowed. Therefore the costs of taking a claim to the tribunal are significantly lower than in the courts. 
The best outcome of making the disputes tribunal more accessible to more New Zealanders is that we will see our country and particularly small businesses get going and get growing. The best outcome of this amendment bill is to enable businesses in particular to get back into business instead of tying up their resources and time in litigation. 
This move will also reduce pressure on District Courts as we have heard. This bill is part of the measures introduced by the Government to fulfil our election promise that we would expand the jurisdiction of the disputes tribunal. It is also part of our commitment to helping small businesses through the economic downturn. 
The most recent increase in the maximum level of claims was back in 1998—11 years ago—under the previous National Government so the proposed increase is well overdue. I particularly like clause 6 of the bill. In clause 6 we have an amendment to section 14 of the Disputes Tribunals Act to lift the provision to $15000. Clause 6 enables a person to abandon part of a claim in order to bring the claim within the tribunal’s jurisdiction. A person with a claim of $16000 may choose to forgo his or her right to claim the full $16000 and may claim only $15000 instead. The thinking is that this would enable that person to claim $15000 and to save perhaps $1000 on legal costs. For many people that becomes a very workable solution. 
We need to understand that having such a process gives people access to a process of resolution but there are limitations of protection and we must understand that. In order for the disputes tribunal to provide cheap simple fast and less formal access there are limits to the protections that would normally be found with a court. Referees’ decisions are not necessarily based on law but rather on the substantial merits and justice of the case. Grounds for appeal are extremely limited. Appeals can be made only if the proceedings were conducted in a prejudicial manner. The disputes tribunal does not allow the legal representation of parties etc. Proceedings are held in private and the decisions are not published. 
This bill makes available a process that is cheaper quicker and simpler for people to be able to resolve their disputes in a timely manner. As we know from the research it gives 3600 New Zealanders the opportunity essentially to get back into business to use their resources for productivity and growth and not to lose their resources in a litigious way. 
The bill proposes an increase in claim levels from $12000 to $15000 or to $20000 with the consent of both parties. This will achieve the objectives of improving access to the tribunal and of allowing an increased number of New Zealanders to be able to reduce their costs when resolving small civil claims. This bill will increase access without compromising the nature of the tribunal. The current level of protections would continue to be relevant and appropriate for the amounts of money involved in disputes. The only changes to the tribunal will be operational in managing the increased number of cases coming before it. 
I appreciate the opportunity to stand in support of this amendment bill. Thank you. 
Bill read a first time. 
Hon ANNE TOLLEY (Minister of Education) 
 on behalf of the  
Minister of Justice 
: I move  
That the Disputes Tribunals Amendment Bill be referred to the Justice and Electoral Committee 
 for consideration that the committee report finally to the House on or before 31 May 2009 and that the committee have the authority to meet at any time while the House is sitting except during questions for oral answer during any evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House despite Standing Orders 187 and 190(1)(b) and (c). 
Motion agreed to.