Arbitrability of Tikanga Māori Disputes

Summary

On 26 February 2021, the High Court in Auckland released its decision in Ngāti Rehua-Ngātiwai ki Aotea v Ngāti Rehua-Ngātiwai ki Aotea Trust Board [2021] NZHC 291, recognising the primary position of tikanga Māori as the first law of Aotearoa.  The case is also notable from an arbitration perspective in its application of section 10 of the Arbitration Act 1996, on the arbitrability of tikanga Māori disputes, and the inherent jurisdiction of the Court to stay proceedings, notwithstanding articles 5 and 8 of Schedule 2 to the Arbitration Act.

In delivering his decision Palmer J made the following comments in summary:

[2]   Tikanga Māori was the first law of Aotearoa … a court must be very careful about “finding” tikanga as a fact, even where it is requested by the relevant iwi or hapū to do so … I consider the Court is bound to make decisions consistent with tikanga Ngāti Rehua-Ngātiwai ki Aotea.  But I do not consider it is the role of the Court, or is even possible for the Court, to determine the whakapapa of the two people.  That is for Ngāti Rehua-Ngātiwai ki Aotea.

His Honour went on to hold (1) that agreement to refer the dispute over the application of the hapū’s tikanga to determine whakapapa to arbitration was an abuse of process, outside the protections of articles 5 and 8 of the Act; and (2) the dispute over whakapapa was not “arbitrable” in terms of section 10 of the Act.

Background

In December 2016, Ngāti Rehua-Ngātiwai ki Aotea, the predominant hapū on Great Barrier Island, initialled a Treaty of Waitangi settlement agreement with the Crown.  Before it could be formally signed, and come into full effect, a number of issues needed to be resolved; issues which were contentious.  Those issues were referred to a committee of kaumatua (tribal elders) for resolution by agreement, in accordance with an earlier order by Palmer J.

In the course of trying to resolve those issues, the committee went to mediation to agree a process to resolve issues which could not be agreed between themselves.  The resulting agreement included an agreement to arbitrate any intractable issues.

The case before the Court concerned the validity of that agreement to arbitrate a dispute over eligibility of two people to be considered as part of the Ngāti Rehua hapū.  The point at issue was their whakapapa, or ancestral right to be considered as part of the tribal group.  

Perhaps indicative of the deterioration in the relationship between the members of the committee, they were unable to agree on an arbitrator, so the appointment was made under article 11 of Schedule 1 to the Act.  A number of elders of Ngāti Rehua were unhappy with the appointment, and applied to the High Court to have the mediated agreement set aside.

The core of the unhappiness over the arbitration was the appointment of an outsider to determine the dispute.  As one witness for the plaintiffs observed:

The tikanga of our hapū is that we alone are responsible for whakapapa, those of us who have had this knowledge passed down from our elders and who are the keepers of this information.  There is no one else who can or should advise us on these matters or interfere with them.

Others commented that it would be “a gross insult and humiliation” to have whakapapa decided by a pākehā  with no connection to the hapū or knowledge of its tikanga.

Issues

The Court addressed the application, not as relating to the appointment, but as raising issues of jurisdiction of the Court to set aside the arbitral proceedings, and the arbitrability of the dispute.  Both are relatively novel issues, rarely raised before the Court.

(1)  Court intervention

Article 5(1) of Schedule 2 to the Arbitration Act provides:

In matters governed by this schedule, no court shall intervene except where so provided in this schedule.

Article 8 goes on to provide that where there is a dispute which is subject to an arbitration agreement, the court shall stay any proceedings brought in relation to that dispute.

The question at issue in article 5 is the extent to which matters are “governed” by Schedule 1, which encapsulates the UNCITRAL Model Law on Commercial Arbitration, and whether or not an agreement to arbitrate creates an “exclusive blanket” ousting the jurisdiction of the courts entirely, save for those specific matters outlined in Schedule 1.  In this respect, section 5(d) identifies one of the purposes of the Act to “redefine and clarify the limits of judicial review of the arbitral process and of arbitral awards”.

This issue was first considered in any detail in Carter Holt Harvey Ltd v Genesis Power Ltd [2006] 3 NZLR 794.  That case concerned the construction of a cogeneration plant at Carter Holt’s pulp and paper plant at Kinleith.  Under a power purchase agreement, Genesis was to provide electricity from an electricity generator to be constructed by Rolls-Royce within the Kinleith plant.  The plant failed, resulting in (1) a claim in court by Carter Holt against Genesis for breach of the power purchase agreement; (2) a claim in arbitration by Genesis against Rolls-Royce for breach of the turnkey construction contract; and (3) a claim in court by Carter Holt against Rolls-Royce in tort.  Rolls-Royce sought an injunction staying the arbitral proceedings.

Randerson J held that the Model Law was not a comprehensive code and that anti-arbitration injunctions were not covered by article 5.  In doing so, he outlined a number of principles, including that the power to stay was to be exercised sparingly and only where injustice would arise. Any applicant for such a stay would need to establish that “continuance of the arbitration would be oppressive or vexatious or would otherwise constitute an abuse of the process of the Court.”

While there was no suggestion of oppressive or vexatious use of the Court process, Palmer J held that the referral to arbitration was an abuse of the process of the Court, as he had previously ordered that issues of whakapapa should be determined by kaumatua of Ngāti Rehua themselves.

(2)  Arbitrability of disputes over the application of tikanga Māori 

Section 10(1) of the Act provides as follows:

Any dispute which the parties have agreed to submit to arbitration under an arbitration agreement may be determined by arbitration unless the arbitration agreement is contrary to public policy or, under any other law, such a dispute is not capable of determination by arbitration.

Palmer J determined that tikanga Ngāti Rehua was part of the law of Aotearoa, and that tikanga prohibited the determination of issues of whakapapa by anyone other than the elders of that hapū.

Comment

Judicial discussion of both section 10 and article 5 are rare.

This decision, however, raises a number of problematic issues:

·       the jurisdictional issues raised in Carter Holt v Genesis are in no way apposite to this case.  In that case, there were overlapping proceedings which were ultimately resolved by consolidating the court cases – the parties in that case achieved a more prompt resolution of all the proceedings;

·       the driving concern, at least outlined in the evidence of the applicants, appears to turn on the identity of the appointed arbitrator, rather than the fact of arbitration.  In an earlier decision, Palmer J acknowledges that arbitration was a valid option for resolving the outstanding issues – not so, whakapapa;

·       the Court focused on the inappropriateness of an independent pākehā arbitrator, with no connection to the Ngāti Rehua hapū and no knowledge of their tikanga to determine sacred issues of whakapapa, to justify a finding that the dispute was not arbitrable.  However, that is a common occurrence in any arbitration involving tribal issues or issues of foreign law – such issues are determined as findings of fact after consideration and evidence from those steeped in such expertise – pūkenga.

Sensitive issues are resolved with the advice and under the guidance of pūkenga, with expertise in tikanga, and other experts in engineering, foreign law, complex financial issues and the like internationally on an almost daily basis.

Consider, for the sake of comparison, the case of Ngāti Hurungaterangi v Ngāti Wahiao [2017] NZCA 429.  That case concerned issues of mana whenua over land in and around Rotorua, including the Whakarewarewa thermal springs.  The land was held in trust, following a treaty settlement, pending resolution of a dispute over which hapū had mana whenua over the land, and to what extent – Ngāti Whakaue or Ngāti Wahiao.

The trust deed contained an arbitration clause, and a tribunal was constituted with two experts in issues of mana whenua and a third chair, retired Supreme Court Justice, Bill Wilson QC.  Issues of mana whenua are, arguably, as sensitive to Māori as whakapapa, as one follows the other.  Whakapapa determines iwi and hapū affiliation; and mana whenua governs the relationship of iwi and hapū to the land.

No issue of jurisdiction or arbitrability was raised in Ngāti Hurungaterangi, the sole issue being the setting aside of the arbitrators’ award for lack of reasons.  Sadly, both Ngāti Hurungaterangi and Ngāti Rehua-Ngātiwai ki Aotea join a number of disputes where arbitration has failed to meet the needs of the disputants – in both cases, the relevant parties had agreed to resolve their disputes by arbitration, and in both cases the parties have not achieved what they had agreed.

The end result is best summed up by one of the witnesses for the defendants:

Without this [arbitration] I fear that several more years may pass before these issues are resolved and that will only compound the financial, social, and cultural loss that our people has already suffered as a result of the plaintiffs starting this pākehā process.

While the pre-eminence the Court has given to tikanga Māori is to be applauded, its failure to recognise the flexibility which arbitration provides, including holding hearings on marae, setting procedures appropriate to Māori cultural values and taking guidance from pūkenga, experts in tikanga, the decision has left the parties in an intractable position.  They had consulted, they had tried to reach agreement, and arbitration was the agreed means to determine any deadlocked disputes.  Now the dispute is issued back to the committee which had failed to resolve the dispute in the first place.

We are left with the inference that, had the arbitrator been selected from the Ngāti Rehua hapū; and had that person been a recognised pūkenga with expertise in the relevant tikanga, the agreement to arbitrate may not have been set aside. The arbitration could have followed an appropriate process consistent with accepted procedures and tikanga.  That has little to do with abuse of the court or the arbitrability of the dispute.

The case is likely to be appealed.