Implementing the Committee’s recommendations will likely result in a period of flux and a paradigm shift in litigation culture. In the short term, we predict that any implementation may well see further increases in the use of arbitration to maintain the procedural status quo.
The report is the culmination of almost 4 years of consultation with the legal profession, which initially began with a review of the procedural rules of the District and High Court to improve access to civil justice in Aotearoa New Zealand. A widening of the initial focus to questions of legislative and policy reform led to additional consultation, a longer process and ultimately recommendations which could dramatically overhaul certain aspects of New Zealand’s civil justice system.
The report identifies that financial, psychological, cultural and information disparities are barriers to accessing justice. Such entrenched challenges are beyond the scope of procedural rules but can be ameliorated by amendments to those rules and to the jurisdictions and registries more broadly.
In response, the Committee has recommended 23 changes straddling all levels of the dispute resolution system.
- High Court: making significant changes to the High Court Rules to include proportionality as a guiding principle, narrow the scope of witness evidence and document discovery, require exchange of more limited written evidence at a far earlier stage and increased focus on facts that are genuinely in dispute.
- District Court: reinvigorating the civil jurisdiction of the District Court through appointment of a Principal Civil District Court Judge and part-time deputy judges, from the experienced bar, to strengthen the expertise of the court’s civil registry to ensure best practice in case management.
- Disputes Tribunal: substantially increasing the jurisdiction of the Disputes Tribunal (from $30,000 to $70,000 as of right or $100,000 with the consent of the parties) to achieve justice in an expeditious, efficient and proportionate manner, with an increase in the scope of appeals for claims over $30,000.
Recommended changes to High Court procedure
Of particular interest to large commercial entities will be the desire to streamline evidence and discovery processes in the High Court that often present the largest burden on internal resources and external legal spend.
Many submitters and the Committee identified in the High Court a “maximalist” culture of litigation, often spurred by adversarial clients and anxious practitioners. Observations from the profession were that this culture was enabled by the judiciary due to the absence of effective case management and light enforcement of procedural rules – resulting in increased time and cost.
The more radical changes proposed include:
- expanded initial disclosure to include adverse documents known to the parties with subsequent discovery only ordered at a judicial issues conference where necessary and proportionate;
- exchange of witness statements shortly after the exchange of pleadings, which are to be taken as read at trial and supplemented by further statements or viva voce evidence at trial;
- a judicial issues conference to occur following expanded initial disclosure and exchange of witness statements and which will require much more active case management than current conferences;
- a strict limit applied of only one expert witness per issue per party with mandatory expert conferral;
- core events to be established at trial by document record evidenced by the documents in the agreed bundle and chronologies, which will be admissible as to the truth of their content.
Such changes, along with the proposed permanent adoption of practices developed in response to the COVID-19 pandemic for remote hearings should help pave the way for speedier, economic determinations. Yet without buy-in from the profession and sufficient judicial oversight, the changes may simply front-foot the time and expense of litigating.
If implemented successfully, the changes should be welcome news for any participants in the civil justice system where times to trial in the country’s busiest registries have been stretched to all-time highs in previous years.
A larger role for arbitration and mediation?
Arbitration has also increased recently as a response to court system delays. As well as the potential for truncated processes (especially where the parties are working cooperatively on the timetable), arbitration has the added benefit of being private and confidential subject to limited exceptions. A survey of arbitrations between 1 January 2019 to 31 December 2020 recorded domestic arbitrations involving amounts from $30,000 to more than $3 million taking between 9–10.4 months to complete, which is generally much quicker that High Court proceedings . While shorter does not always mean cheaper, given the potential for an almost two-fold reduction in duration, an effectively managed arbitration process can provide both time and financial upsides to the parties.
The Committee’s recommendations can also be viewed in the context of other parts of the justice system, where legislative and regulatory reform has sought to promote the prompt and economical settlement of disputes. For example, mediation has long been incentivised (if not required) by the Employment Relations Authority at the outset of disputes between employers and employees. Similarly, the more recently introduced changes to trust law brought by the Trusts Act 2019 (which came into force on 30 January 2021) expressly provide for alternative dispute resolution processes for both internal and external trust disputes.
The Committee has invited submissions on its recommendation, due by 24 February 2023. These submissions will be considered in deciding on the implementation of any changes.
 The ‘Inaugural Aotearoa New Zealand Arbitration Survey’ authored by Royden Hindle and Dr Anna Kirk assisted by Diana Qiuin collaboration with the New Zealand Dispute Resolution Centre.
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