Auckland Ports threatening to sue their owner

November 21st, 2013 at 2:00 pm by David Farrar

The Herald reports:

has hired top lawyer Mai Chen to help it in a row with the over measures to reclaim more of the Waitemata Harbour.

Ports chief executive Tony Gibson and Ms Chen met Mayor Len Brown in September to try to avoid starting legal action against their owner. Another meeting is set for today.

After councillors agreed in August to make further reclamation of the harbour a “non-complying” activity in the draft Unitary Plan, Ms Chen told the mayor’s office the move wasillegal.

She said it breached the Resource Management Act and the New Zealand Coastal Policy Statement, which sets out councils’ planning requirements for the efficient and safe operation of ports.

Ms Chen said the ports company would contest the legality of the resolution in a submission on the draft plan unless the council amended the resolution.

A CCO threatening to sue the Council that owns it, is not a good look. I’d be very nervous if I was a company director in that situation.

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11 Responses to “Auckland Ports threatening to sue their owner”

  1. PaulL (5,977 comments) says:

    I think a company director would be in some trouble if they ignored legal options they had so as to preserve company value. But yes, it would be somewhat uncomfortable explaining to the Mayor that you were doing that when you effectively serve at his pleasure. Perhaps it’s another way of pointing out that what they’re doing is destroying ratepayer value? Perhaps it’s a political stitchup, and Brown is using it as a way to pull those changes out and say ‘turns out they were illegal.’ Then he gets votes for trying without the punishment that goes with destroying value.

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  2. Liam Hehir (119 comments) says:

    Is it a company? If so, then that’s who the directors owe duties to. Not the shareholders.

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  3. anonymouse (707 comments) says:

    I though one of the reasons for the Super city was to stop all this lawyer enriching public fighting.

    http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=10650740
    “Goodness, they spend a small fortune suing each other! In recent years they have spent at least $10 million on more than 300 legal actions.”

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  4. secondcumming (92 comments) says:

    Well good luck to Tony and Mai trying to find Len today…..he hasn’t been seen for nearly two weeks.

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  5. backster (2,117 comments) says:

    Great fun for the lawyers they win, payment guaranteed, ratepayers lose, Len retires to the Ngati Whatua room.

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  6. Inky_the_Red (744 comments) says:

    Not much different to the time when the SOEs Transpower and Meridian took each over to court

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  7. peterwn (3,204 comments) says:

    Liam – better described as company ‘stakeholders’. With finance companies for example, the directors probably a greater duty to debenture holders than to shareholders as certain directors have learnt the hard way.

    If the Port Company directors consider their situations are compromised by acts of shareholders they should resign. In this instance Auckland Council would be fully entitled to show the directors the door and appoint new ones. If the Council destroys its value of the Port Company, then that is the Council’s lookout.

    IMO the Council is quite entitled, especially as it is a unitary council, to decide on no more reclamations, and as the 100% shareholder would be entitled to direct the company accordingly. The Company needs to realise it is no longer a Harbour Board.

    The situation would be different if there were more than one unrelated shareholders.

    There was a case in the early 1980′s where Christchurch City Council directed its Municipal Electricity Department to not give supporting evidence for a planning application by (then) NZ Electricity to build a grid exit point in the Belfast area. As constructing it at that time was solely for the MED’s benefit, NZ Electricity simply canned the project. Again the Council was within its rights.

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  8. Liam Hehir (119 comments) says:

    Thanks Peterwn – I’m not enitirely au fait with the structure.

    However, looks like POA is owned by a holding company which is itself owned by the Auckland Council as a sole shareholder. So AC would be the ultimate owner but it wouldn’t itself be a CCO, right? Certainly, it removes it another step away from Council control.

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  9. gump (1,541 comments) says:

    Oh Mai Chen!

    Whatever will you do next?

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  10. allgoodal (14 comments) says:

    I guess the port believes the council can’t have it both ways. But even with Mai Chen arguing their point, I can’t see how they’ll be able to force the council to give them what they want. So what actually do they hope to achieve? I look forward to reading the submission.

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  11. martinh (1,163 comments) says:

    Mai Chen is the biggest money grabber ive ever heard of. Im so glad money cant buy eternity so my kids wont have to deal with that busybody tryhard

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