This year I got many more business Christmas cards by email than by post.. I assume that's general, and they've become mainstream. No doubt NZ Post can tell how much the normal Christmas card mailings dropped.

It is fashionable to decry the email Christmas cards.  I liked most of them this year. Tasteful photographs seem to have replaced the moving bling-enhanced mini-posters of earlier years.

What a pity for NZ that NZ Post was not privatized years ago when its first transforming CEO Harvey Parker (and the Board) were warning the Government to take the gains of the huge increase in productivity before the rest of the world woke up to the difficult future for steam post. NZ Post was a world leader in post reform. When the government would not take the logical next step, Harvey Parker's team dissolved, though many had fun around the world advising other countries on how to stop losing money on dinosaur post.

If NZ Post's sunset businesses had been sold, even 10 years ago, the sale could have provided the capital needed by Kiwibank several times over.

There will always be fools around who'll pay on historical expectations for a horse based empire just as petroleum engines take over. Often they are politicians, driven by romantic attachment to sunset industries (or dependence on the funds and votes from their unions)  like Dr Cullen and the repurchase of NZ Rail. But Telecom's inspired sale of Yellow Pages was a reminder that we can rely on compulsory superannuation scheme managers, and investment bankers who advise them,  to squander their contributors' weekly mites.  In March 2007, Telecom sold its Yellow Pages business for $2.24bn to the Ontario Teachers' Pension Plan and Unitas Capital of Hong Kong. They and their bankers have lost most of their money.

I'm surprised that during the recent ill-informed debate on mixed ownership no one raised Bill Birch's inspired sale of the major forests, and some other dumpings of "family silver"  onto overseas investors.  The forest buyers lost well over 2/3rds of their investment. There are always investors around to gamble on the future looking like the past.  

My firm has had a good year. Things have gone broadly well for most clients. We've achieved more for some than I dared hope.

The year ends on a high note, with a gratifying judgment yesterday largely knocking back challenges to the consumer (our client MEUG) and Commerce Commission positions on procedure in a price control methodology merit review.

The day before was the announcement of our qualification on the government’s  law firm supplier panel. Though small we are  approved legal advisers to the government in two areas, finance and banking law (one of 8 firms approved nationwide) and corporate and commercial law (one of 14 firms nationwide). We think we can allow ourselves a cautious grin.

We like the offices we took over recently for expansion. The sun shines in. I walk fast to work each morning eager to get into the day's excitements.

But it is not quite so exciting to be here still late in the evening.

So among the first tasks of the new year will be recruitment. It is not success to be here evening after evening, trying to regain the moral right to spend time on a pro bono project or to post on my blog.

If you know some brilliant lawyer:

• who knows at least some aspect of law backwards, and
• has done enough legal  heavy lifting to make accuracy and precision instinctive, and
• who could want to do what we do,

steer them in my direction after the Christmas break. They can see what Franks & Ogilvie do from the website  but here's a short RFP:

We need at least one more lawyer. With the right senior appointment to share the supervision we can also take another junior.

An ideal candidate might be returning from OE, but not want to go back into what they know best, or they could be in partnership or on track for it, but with a nagging sense that conventional practice will not be satisfying in ten years. They would have at least four years post admission experience in one or more of:  

• company, securities, property, competition or commercial law, especially transactions, regulatory compliance and disputes;
• general litigation with administrative or commercial or similar experience an advantage.

 They'll probably be interested in politics, usually objectively but in some matters with a passionate view of what should be happening. Their political persuasion does not matter, we are a broad church.

They will respect the service obligation of  lawyering and they'll be articulate with a well above average command of English. 

Health warning – We established our firm to enjoy great work, the company and flexibility.  They might not enjoy working with us if they:

• always like to know just what they'll be doing next month;
• find an open plan office too much;
• can't laugh at themselves publicly sometimes;
• wouldn’t  enjoy networking friendships that mix business with pleasure. 

Mention to your friend that if they do get in touch they can spare us the cliches (being focused, results oriented, a team player, ambitious and committed to excellence).  Having said that, if they are not all those they might find the firm a mite uncomfortable.

A High Court Judge last night gently asked me the plural of ignoramus. Embarrassment was ready to hand. He did not need to refer to the NBR report of a careless conversation with Jock Anderson which prompted a recent post.

I had in mind in judges who refer to “the privilege of limited liability” when chiding business people, though judges in these areas are largely driven by statute.

Now I’ve seen the dictionary definition of ignoramus I could have scarcely scored a better own goal. The word gained currency as the name of an ignorant lawyer in a 1615 English play. The plural is ‘ignoramuses’, not the faux Latin ‘ignorami’ attributed to me by Jock, probably correctly.

My humbling is deepened by the crisp command of arcane finance theory displayed in a judgment of Clifford J delivered today. He is running a mammoth (in lawyer numbers) case testing a new merit review appeal regime under the Commerce Act provisions for price control. It will govern the methods for setting maximum rates of return on capital for monopoly suppliers in electricity and other markets.

In early hearings he disarmingly affected innocence of specialist expertise. Perhaps that was to help settle lawyer anxieties about the task facing the Court. They must argue  the Capital Asset Pricing Model and the significance of beta and leverage to the Brennan Lally simplification of the Weighted Average Cost of Capital, probably without any direct input to the court from experts other than the two lay assessors who will sit with the judge.

I can draw on dim flickers of  recollection from classes at the feet of Professors Trow and Winiata of VUW. . Clifford J's wry initial comments suggested he could not call on anything similar.

But today’s judgment summarises the finance theory issues with extraordinary economy.     Wow.

This morning's Press contains the first official hints I've seen that the Christchurch Council could be sacked, following the path pioneered by the incompetent and unlamented Environment Canterbury.

I'd heard some months ago that a prospective Commissioner had been sounded out for Christchurch. Tough talk by the Minister of Local Government, Rodney Hide, about Hamilton City Council if it failed to heed the Auditor General's advice on its financial incompetence* seemed to be warming up by  the government to give Christchurch a chance to thrive without some of the ball and chains it has habitually elected.

Under section 256 of the Local Government Act 2002 the Minister may appoint a commissioner to perform and exercise a local authority's responsibilities, duties and powers either generally or to the extent specified in the notice.

The minister must have formally warned the local authority and have concluded that the local authority "is wilfully refusing of substantially refusing to perform and exercise its duties and powers under this Act or any other enactment" and that the refusal is "impairing or likely to impair the good local government" of the city or "endangering or likely to endanger the public health or safety" of the city.

A less definitive intervention could be under section 254 which empowers the Minister to appoint a "review authority" to report on whether there has been "a significant or persistent failure by the local authority to meet its obligations" under statute, or " significant and identifiable mismanagement of the resources of the local authority" or there is a significant and identifiable deficiency in the management or decision-making processes of the local authority".

Both would be inflammatory, but the appointment of an objective and reputable reviewer would seem  a more likely initial step by the Minister than a sacking.

I understand that strong intervention could even have the support of some Christchurch Councillors, frustrated by their inability to make their Council more constructive, and impressed by Gerry Brownlee's capacity for leadership.

Unfortunately sackings and reviews rarely sheet the responsibility home where it should lie – often with people who know how to get ill-informed votes. Lets hope the electorate  thumbs down to Clayton Cosgrove and perhaps Brendan Burns (showing public distaste for ruthless politicking) contrasting with the voter loyalty to the constructive MPs Ruth Dyson and Lianne Dalziell, might send the right  message to Labour's nastier activists if they have ears to listen.

* Auckland Council had hired the senior person at the heart of the Hamilton woes but has since managed to lose him.

The debate mentioned in last week's post on the performance of our Supreme Court continues. Kiwiblog surveys recent criticisms and suggests:

" Section 17(1)(b) of the Supreme Court allows the Attorney-General to appoint a sixth member of the court. Perhaps it is time to do just that."

That is unlikely to deal with the main problem though it would reduce the awkwardness when one member is out of action or conflicted out . The Court would still sit in a bench of five. An extra judge could just add to the cost and under-employment of this luxury court.

In the past I've suggested other reforms (here and here).  

The most urgent need may not be susceptible to legislation. More useful judgments will not emerge on command. The court already has outstanding lawyers. It is (rightly) not reviewable by  time and motion men like other organisations. So how do we get the best from them.

Quality concerns may be minimised by more systematic mutual peer review. Those who dumped the Privy Council probably assumed our court would be just as collegial in developing judgments. Perhaps it is happening, but it is hard to see the evidence. Are they meeting to sift out defects in reasoning, to test each other's work constructively for unsustainable assumptions? There are too few signs of that in the "output".

Fresh blood in the Supreme Court might help but only if it contributed to an internal commitment to processes that would extract the best from each judge for a combined product. For example, perhaps they could commit to one majority judgment and one minority dissent.

For an ordinary organisation the reaction to such criticism would be simple – change the boss. That is usually the right first step whether the problem is the boss or not and whether it is fair or not. The buck stops at the top. But Courts do not necessarily have "bosses". The Chief Justice has some leadership powers but cannot sack or command her fellows. *

Company chairs are in a somewhat comparable position. The Chair does not necessarily choose the board, and directors are not commandable subordinates in the absence of consensus supporting the Chair. So most company constitutions have a solution. Directors elect their own chair, who holds office only for so long as he or she retains the confidence of a majority of the members they must lead.

Notably, the state has denied SOEs that benefit,  retaining the power to impose on Boards the politicians' choice of chair – a mistake that should be remedied for the energy companies about to go into mixed ownership

If I were the Attorney General (or the Minister of Justice) I'd be thinking about experimenting with giving the Supreme Court  judges the power to elect and to remove their own chair (but not of course from judgeship).

The other change I recommend is less urgent but more important.  It has been widely (but not often publicly) discussed since the Bill Wilson QC difficulty emerged.

That is is to ensure emergency access to judges who can be irreproachably neutral. It would be reserved for cases where no Bench can be put together from the pool of current and retired judges without leaving residual suspicions of conflicts of interest. A simple standby could be legislative authority to send such cases to the High Court of Australia (and of course agreement on any necessary legislation in Australia to permit that).

Given Australia's constitutional rigidity it might be easier to get agreement that Australian judges will be released for temporary appointment as NZ judges for the case.

We already call on Australian judges to help us out of the inevitable pickles that arise when our little circle of top lawyers could look as if it might put personal relationships ahead of duty. That is why an eminent Australian judge was brought in last year to advise (and give implicit probity assurance to) the Judicial Conduct Commissioner investigating the  embarrassing handling of concerns about Bill Wilson QC's relationship with Alan Galbraith QC.

As I've said before, I do not believe that the racing industy investment relationship would have prejudiced the outcome of the Saxmere litigation. Nevertheless the episode highlighted the vulnerability of the present structure and personne.  Restoring confidence in the irreproachability of our senior lawyers (including judges) could be extremely difficult without a way to get overtly unaffected judges. In the Judicial Conduct  Commission investigation, if we had not been able to call on the Austrailian judge the suspicion could have been worse.

I support parachuting an occasional top overseas judge into our court from time to time, to fertilise our line-bred pool. But that is for routine quality maintenance now that our lawyers have lost the regular exposures to world best judging in the UK. It would not deal with the potential for a constitutional crisis should we have a case in which a majority of our top judges have connections (or former connections) that ideally would disqualify them from sitting.

Unexpectedly, Dr James Farmer QC on Monday gave what appears to be a living demonstration of  the vulnerabilities in our current set up. His website gained a post attempting to distance him from his own criticisms of the Supreme Court.. It is so bizarre it seems explicable only if there is in fact an unhealthy importance in the  personal relationships between counsel and the Court in our senior legal hothouse. 

The significance of his recantation lies not in the second thoughts (we can all have those) but in a descent to personal insult in what seems to be a desperate attempt to distract attention from what he clearly said. Here is Dr Farmer on Monday this week:

I have heard it said that lawyers have the skills and experience to make good politicians but that, a lawyer who has become a politician, loses those skills and can seldom return to being a good lawyer. I was reminded of this when I read the interpretation to the Court Report broadcast given by Stephen Franks (a former commercial lawyer, ACT party MP and now lawyer again) on his web site. His discussion of the programme and in particular of my contribution to it begins with the heading “Heat Builds on Supreme Court” and then immediately suggests that the “skids” are under the Supreme Court in its current form.

Here is my "interpretation of the Court Report broadcast" he mentions. Can you work out what prompted Dr Farmer into this:

What nonsense! And it is just this kind of destructive and emotive and irresponsible language from someone who is well known that makes constructive debate that much more difficult. Constructive debate should lead to a greater awareness of issues that can be addressed and that may lead to improvement in an institution. Destructive commentary from the likes of Franks, particularly when it is not backed by practical suggestions of what should be changed, does nothing that is positive and is just plain corrosive.

 If I knew what his practical suggestions were, and on what we disagree I could perhaps understand ad hominem tactics. They remain poor form but can be effective nevertheless. But my comments are broadly aligned with his.  It is particularly odd to be accused of not making practical suggestions. Search this blogsite for "Supreme Court" and there are plenty.

Neither he nor I have said much I've not heard from a number of his brother barristers. Indeed I express them in less inflammatory and personal terms than them.

Hopefully this Parliamentary term will see energetic development of a procedure to either get patently non-conflicted judges sitting in our court for sensitive cases, or for the cases to be heard by a neutral outside court. It would be very rare indeed that such a procedure would be needed, but we should arrange it well in advance.  Our Attorney General has in the past expressed clear views on this matter.

*A Supreme Court judge can't be remove administratively, absent incapacity or moral turpitude, to use the handy old terms. I believe we need a right of citizen recall, especially now we've lost the safeguard of appeal to neutral outsiders, but the current issues are a million miles from what could prompt citizen recall initiatives in the states that enable them.

Yesterday morning Radio New Zealand covered a review of the national breast cancer screening programme. Reportedly it was commissioned because of resignations at the National Screening Unit which manages and supports screening.

I hope it goes much further. From client work we have been involved in this year, the Minister should be more concerned about whether the government is wasting a huge sum.  The cost/benefit balance of mass screening mammography is under question internationally.  See for example – here, here and here.

As reported by the Listener the Breast Screening Unit recently colluded with mammography providers to attack breast  thermography. The latter uses infrared heat signatures on skin to detect changes in breast health. The mammography campaign called thermography ‘dangerous’. On investigation it turned out that the danger was only that women might choose thermography when the breast screening promoters believe they should just rely on mammography.. 

In our opinion the attack may have been at least partly motivated by the screening programme supporters' extreme sensitivity to questioning of the value of their screening.  Some of those advising the Ministry and the NSU on the relative benefits of mammography and thermography appeared to have professional and/or financial interests in ensuring the mammography screening program continues.  The perception of thermography as a threat to the screening program, came at the same time as efforts were being made to downplay a scientific report questioning mammography’s cost/benefit justification.

Breast cancer is the a big preventable killer of New Zealand women.  Mammography may be the best early detection method for many women. But from what we saw of Ministry documentation there was little objectivity or rigour in the decision-making on screening matters. The NSU response to the international research casting doubt on the net value of mass screening was ludicrously defensive.

Worse from our clients' perspective, the Ministry would not discuss how publicity should best inform women of the pros and cons of the various procedures. Quite apart from their code obligations to be fair, in dealing with thermography providers they lacked simple courtesy. Apparently courtesy need not extend to those one disagrees with.

There is a real possibility that millions in precious health dollars are being wasted as a result of the poor performance of officials. If those responsible are among those who have left the Ministry, it is hard to be concerned. If  those remaining are those we've been tracking, there should be more to follow.

PS Lest there be misunderstanding, I do not purport to express a view on the merits of thermography or mammography despite having learned much more than I ever expected on them both. Their proper uses are for specialists to debate. It seems to me that thermography is likely to have value especially for women too young for mammography.  I would also encourage my family members to use free mammography screening. But that is a very different question from whether such mass screening is a sensible use of what it costs us as a country, and whether the money could save more lives used another way.

I’ve just had my attention drawn to a piece in the NBR reporting a conversation with Jock Anderson. I did not expect it to be reported like that, but it is fair, given normal compression.
But it is in unecessarily frank language and omits an aspect I would have highlighted had I realised the conversation would be featured (this is not a criticism of Jock – I should have known better).
The comment omitted was the cost to shareholders of creating asymetric uncompensated risks for directors. When shareholders take the benefit of directors’ risk decisions, but can pass the costs back to directors for ones that go wrong, then Directors can legitimately demand a better chunk of the return that owners would otherwise expect.

The article also leaves the impression that it is judges who are alone responsible for confusing and over-complicating previously conceptually clear law. In fact politicians and officials
responsible for legislation have as much or more to answer for.

Sadly the current is flowing strongly in the direction of even more of this kind of self-defeating “slogan law”.

The skids are under our Supreme Court in its current form.

Last night's Court Report on TVNZ 7 would look innocuous to non-lawyers, but Dr Jim Farmer QC's open public criticism of the Court's quality is highly significant. Dr Rodney Harrison QC was there for balance, but his defence of the Court was lame.  That three QCs were discussing the problem on TV at all is extraordinary in NZ. Our legal establishment has discreetly enforced the conventions against lawyer public comment that might undermine respect for the courts in which they practice. Concerns about judicial quality have been inhouse whispers only.

Dr Farmer's anxiety was made public in a post on his website in August. There too he was careful, to the  point of parody, to emphasize his respect for the Court. But what he says is a mild version of the worries widely expressed among eminent barristers.

Judges too are deeply frustrated. Court of Appeal judgments are commonly more useful than the superior court  judgments that supersede them. Instead of simplifying and clarifying, too many Supreme Court decisions add complexity.

Trial judges can find Supreme Court guidance confusing, and sometimes impractical.  I understand, for example, that recent Supreme Court dicta in Abdula (on procedures when defendants need translators)  has resulted the rare step of District Court judges formally warning the Ministry of Justice that such trials will double in length. This may be a simple illustration of the dangers of Supreme Court "legislating" without the kind of information that legislators commonly get.

The Supreme Court judges sit in an $80m new building with too little to do that really needs doing.

We've given ourselves a Roller and 5 chauffeurs for what should, in a country this size, be around ten to twenty outings per year. Previously a rich old uncle let us borrow his extra Roller when needed from his world renowned garage. It came with his vastly experienced chauffeurs. 

Until they landed this pseudo job our new chauffeurs were well respected in gainful truck driving. Now they are tempted to spend their spare time developing incomprehensible self-indulgent expositions and presumably bickering (since they often do not see their way to a consensus). On most issues they should be reconciling differences, finding principled and predictable ways to  ensure that the law is simplified each time they have an excursion.

Ideally that clarification would align with ordinary decent people's  instincts for what the law should be. Dr Farmer criticised the Morse judgments, essentially for not so aligning. I've posted on that case here and the Court here.

 I'm dubious about criticising a freedom of expression decision for not being in accord with majority feeling (though judges should test their instincts carefully when majority opinon will be outraged). More importantly Morse is one of the cases in which the judges have not coordinated their reasoning. Even acknowledging in their individual ruminations the contrary or coinciding view of their colleagues, and narrowing the room for misconceiving the scope of their disagreements would have been useful..

The proportion of cases in New Zealand now going three rounds is far above that of other common law countries, with no evidence of added certainty or clarity. The rule of law is imperilled by justified public disdainan for the law's delay, cost and outrageous outcomes. The Supreme Court is an enormously expensive indulgence for lawyers at the expense of litigants, and those who dare not get embroiled in litigation..

I look forward to more from the emboldened barristers on how to fix the problem. I'll post more on that. The solutions need not be complex. But there is a risk. This matter is too pressing and too important to be handed off to the odd assemblage comprising the Constitutional Review.

The Court Report will be broadcast again on Channel 7 at 10-05 pm on Sunday.

Labour will continue to benefit from their open leadership contest. It gives the media an excuse to pay otherwise unwarranted attention to their favoured party. That attention positions Labour as a material influence in politics when they should objectively be ignored for the next year or so until they have worked out how to stand for something more than reactionary envy and 1970s policy.

But I doubt that the membership primary will add much internal value.  Whether Labour emerges with a leader who can stimulate, tolerate and then carry the burden of a major ideological shift will be much more the result of coincidences of personal loyalties and ambitions than of any educative effect of internal debate and exposure to set piece oratory competitions before the members.

Internal candidate debating competitions are deeply flawed exercises in democracy. They cannot perform the main function of an election campaign. They cannot explore and expose the critical weaknesses of the candidates. If they did tease them out they would wound the party privately and publicly. Little damage is more long-lasting than the damage from publicised frank assessments of weakness by close colleagues.  So intraparty primaries become competitions in public self praise, with little risk of contradiction. Sure there may be cunning allusion, comparison by emphasis. But formally the candidates can only highlight their own attributes, and stay away from the dangerous territory of exploring their competitors' weaknesses.

The contest before members (and the media)  may allow members to compare oratical skills and to assess charisma. But oratory and charisma are desirable, not essential. A leader's greatest influence over the longer term will be on the party's internal culture. Does it value wisdom, courage, loyalty, honesty? Or does it  reward more slyness, ruthlessness and skill at playing the game.

If the candidates have any suitability for leadership at all they know that the party can only address those questions privately despite them being the most important. So intra-party primaries are  boxing with one hand tied behind, decision making with the most important information hidden.

Because Labour has not made the mistake of leading party members to think they will make the decision, the caucus voters can still test and draw out of the woodwork the evidence of worms and knotholes and character fungi.  They will not be forbidden territory in private.

But that means the eventual decision could run counter to the way members would vote after observing their oratory competition. The consequence can be unjustified rank and file suspicion of their representatives. 

The bigger risk for a party in running a primary is also unlikely to emerge in the current Labour exercise, because the decision has not been foolishly given to party members who go to the competitions. The bigger risk is that one or more of the candidates will decide that members must know of their competitor's defects. It may be just the short term interest in winning. It may be supplemented by a sense of duty to ensure that the voter decision is properly informed. Either way means the airing of dirty linen. All people and all organisations have some linen that is at least smudged.

A ruthless candidate may covertly promote third party questioning of competitors to elicit public exposure of vital negative information. It is a high risk strategy. It can rebound directly  in condemnation for all associated. Many contenders will have been  complicit for years in covering up the worst flaws of their colleagues. Simple loyalty and simple commonsense tell you that your party only thrives when you are all helping to compensate for and to cover for your colleagues' weak spots. So those who put the collective interest first will be hamstrung in responding to a whispering campaign, or even to media questions. The party rule will be no comment, to avoid adding oxygen to the illicit campaign.  One nil to the treacherous contender, at least for the short term.

More importantly the process of "briefing" against a colleague is enormously corrosive. Even if it is done through a third party to a grateful journalist  that journalist nevertheless know that you or your team are capable of treachery. Sooner or later that knowledge spreads. Suspicion that it could be true may infuse your party and warp its culture away from the spirit of altruism needed to make it hum.

To me the US primary process is at least partially responsible for producing parties full of representatives who spend more time highlighting how they differ from each other, and how little the parties have in common, than they do working after elections are won, on what they can build for their country in common. I recognise the benefits of forcing candidates to woo party members. But it should always be clear, as it is for Labour, that the final decisions will be made by much better informed subordinate leaders. Otherwise the costs of primary processes may exceed the benefits. 

I know about some of this from experience.    

Tis the season of anointing our eminent persons.

Auckland's Watercare Services has taken the accountants' prize for the top public sector annual report.

The Watercare award reminds me to try to find out what is going on in the waste and water industry . I understand that Watercare now feels big enough and strong enough (and presumably well enough connected) to weaken Water New Zealand, extending to limiting participation at the organisation's annual conference that may have affected even some of its consultants.

There may be a simple explanation, but I hope it is not just the monster enjoying flexing its muscles.

A couple of weeks ago I enjoyed the DomPost's Wellingtonian of the year dinner. I was mystified by the judge's decisions in some categories (and in previous years as recorded in the programme). Odd that Lloyd Morrison does not feature, but even more odd are some of the names that do.

On Wednesday I enjoyed the engineers' dinner. They are different from lawyers and accountants. To me the projects that made the finals were fascinating, but there were no detailed photographs or videos, and no explanations of the novel or outstanding elements. But much more memorable to me were the genetics on display.

Maybe the  influx of young Asian engineers now underway will change things, but from my observation at the dinner,  if your kids are short, fat, female and not red-headed, you might tell them the odds are against becoming top engineers.

I'm a little above average height for a male, but I was one of the shortest men in the banquet hall. The room was full of tall to really tall men, few fat. And the recipients of the individual awards seemed to be at least half gingas, or at least auburn. 

Fertile ground for some doctoral research, and then of course Human Rights Commission intervention.  Of course the explanation could be that engineering businesses send not their top people to these affairs, but those they can best spare for the evening. But that leaves the same problem. Why are they all tall.