Court of Appeal rules against kiwifruit growers

New Zealand kiwifruit growers have already indicated that they will lodge an appeal in the Supreme Court, after the Court of Appeal handed down its judgement on Thursday, finding that the Government is not liable for the losses resulting from the PSA outbreak that devastated the industry.

The plaintiffs known as Strathboss, which include 212 growers, previously proved that a shipment arrived from Shaanxi Province, China, in 2009 containing 4.5kg of pollen, anthers and other banned plant material that were infected with Psa. In 2018, the NZ High court ruled that the MPI (formally MAF) was negligent in allowing the Psa disease into New Zealand in 2009.

The Crown contested the findings, and both sides lodged their own appeals, which was heard in March 2019. The appeal also challenged the decision that the Government did not owe a duty of care to Seeka as a post-harvest operator.

After a 12-month deliberation process, The Court of Appeal has ruled that the Government has a statutory immunity precluding liability for the alleged negligent acts or omissions, under the Crown Proceedings Act 1950.

In its decision, the Court also concluded that: "section 163 of the Biosecurity Act 1993 provides an immunity in respect of the acts or omissions of the relevant (MAF) personnel. That is, the individuals said to have been in breach of a duty of care to the respondents have an immunity against civil liability."

Kiwifruit Claim Chairman, John Cameron says the growers are aggrieved by the decision.

“The Court of Appeal held that MPI was negligent in allowing a high-risk shipment of pollen anthers infected with PSA from China into New Zealand. But they found the Government does not owe a duty of care to ordinary New Zealanders and can’t be held liable for its actions, simply because it’s the Government,” he said. “The decision by the Court of Appeal relied upon an interpretation of the Crown Proceedings Act that effectively means the Government can’t be held to account for any wrongdoing."

Michael Franks Chief Executive of Seeka said that they are mulling over the decision.

“Obviously we are disappointed as the facts of the case are confirmed, there is no question about how Psa got into New Zealand and the devastating consequences of that. What seems to be question is whether or not you can sue the Government. The Claim Committee and litigation funder, LPF, are thinking about that now and whether or not to proceed to the Supreme Court.”

However, the court went further, analysing the duty and breach as if the immunity issue had instead been answered in favour of Strathboss and Seeka, in two causes of action (in the event that the matter is referred to another jurisdiction). The first related to whether MAF personnel owed a duty of care at the pre-border stage in relation to the assessment of risk associated with the importation of pollen for the previously untried use in commercial artificial pollination of orchards.

The judgement found: "(In relation to) the granting of the import permits, we would have found that no duty of care is owed. Although there is sufficient proximity, policy factors, in particular the risk of indeterminate liability, mean it would not be fair, just and reasonable to impose a duty of care in these circumstances."

However, it went onto say that had a duty of care been owed, The Court would have found that the relevant personnel acted in breach of the alleged duty by granting the import permits without undertaking an effective risk assessment.

The second cause of action; the failure to inspect at the border, The Court also found that no duty of care existed, for essentially the same reasons as the first cause of action.

"Had a duty of care been owed, we would have found that the failure to inspect the June 2009 consignment of kiwifruit pollen fell below the standard of care expected of skilled and informed personnel in the circumstances. However, that failure had no causative effect because the permit made provision for unmilled pollen," the judgement found.

However, The Court would have agreed with the Judge’s overall finding that the June 2009 consignment was, more likely than not, the source of the Psa3 incursion.

The Kiwifruit Claim legal team is in the process of fully analysing the latest decision, but Mr Cameron vowed that the matter is far from over, saying there will be an appeal in the Supreme Court.

“We believe this interpretation is wrong," Mr Cameron said. "It is both logical and reasonable that the Government should be held responsible for its actions, and those of its employees, where it is clear that significant harm and losses have resulted from their negligence. This is no different to the law that allows us to hold local councils and private business to account for their negligence."

The MPI's Deputy Director General Biosecurity New Zealand, Penny Nelson, made a brief statement: "The Ministry for Primary Industries notes the court’s decision, but at present our focus is on helping the primary sector deal with the challenges presented by COVID-19. Given the case is likely subject to appeal, it’s inappropriate to comment further."

The Full ruling can be read here: https://courtsofnz.govt.nz/assets/cases/CA4202018.pdf 


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