Q3: Who has legal authority to make the decision?

Once the source and limits of the authority to make the decision have been identified, it is also important to check that you have identified the right person to make the decision.  A delegation may be required.

For statutory powers, who is described as the decision-maker in the relevant statute or regulation? In what capacity are they acting? If it is proposed that someone other than that named person will make the decision, then is there a valid delegation from the person authorised to make the decision in the statute or regulation?

The Court of Appeal determined that a delegation of (quasi-judicial) decision-making powers to a company was not valid, because the power in the statute to delegate to an “officer” should be read as being limited to natural persons in an employment or contractual relationship with the Council.
Just One Life Ltd v Queenstown Lakes District Council [2004] 3 NZLR 226 (CA)

A delegation is a formal approval or permission from the decision-maker for someone else to make the decision on their behalf.

To ensure a delegation is valid, you need to think about the following things:

  • Does the statute or regulation expressly prevent delegation? If so, only the named decision-maker will be able to make the decision. For example, under s 48 of the Public Finance Act 1989, a Minister cannot delegate the Minister’s power to borrow.
  • In what capacity is the named person acting? For example, the Solicitor-General may delegate some of the law officer functions to a Deputy Solicitor-General, and the chief executive functions to a wider group.
  • If the statute or regulation permits delegation, are there any limits on the delegation? For example, s 28 of the State Sector Act 1988 limits a chief executive from further delegating powers delegated by a Minister. Other statutes may specify the group of people that can receive a delegation (such as a chief executive or officers of a department).
  • If the statute or regulation does not say anything about delegation, sections 28 and 41 of the State Sector Act 1988 provide Ministers and public service chief executives a general power of delegation. Sections 73 and 74 of the Crown Entities Act provide the ability to, and limits on, a Crown entity board’s power to delegate.
  • Sub-delegations are generally not possible without express authorisation.
The Privy Council confirmed that it would not have been possible for a Minister to delegate final decision-making on port asset allocation to the Auckland Harbour Board. Such a delegation would have been inconsistent with the scheme of the Act.
Manukau City Council v Ports of Auckland [2000] 1 NZLR 1 (PC)
Decisions to implement a new driver licensing scheme were challenged for, amongst other reasons, the lack of a written delegation by the Minister of Transport to the relevant agency.
The Court of Appeal drew a distinction between the absence of a written delegation to bring a rule into force or exercise a power (which may be fatal) and the delegation of tasks of obtaining submissions and consulting, which could proceed on the basis of an oral delegation without endangering the final decision of the Minister.
McInnes v Minister of Transport [2001] 3 NZLR 11 (CA)

The delegation should follow all process requirements on delegations set out in the relevant statute (if the statute expressly permits delegation) or s 41 of the State Sector Act 1988 (if the statute doesn’t prevent delegation). For example, if the delegation is to a person outside the public service, Ministerial approval is needed under s 41 of the State Sector Act 1988.

Most statutes that provide for delegations require them to be made in writing.  If not, it is possible to establish that a delegation was in place notwithstanding a lack of written evidence, but it comes with a high risk that the delegation and any subsequent decisions might be held to be invalid.  It is best practice to document all delegations.

Delegations may be able to be made specifically to named persons, or to any individual or groups that hold a specified position.  The State Sector Act 1988 leaves both options open for delegations made under that Act.  Other statutes may limit these choices. 

The decision-maker remains responsible for the decision, even if it is made by a delegate. A decision-maker is able to amend or revoke a decision by a delegate in the same way the delegate would have been able to, but cannot otherwise “take back” the delegation and “remake” the decision if the delegate has already made the decision.

In limited circumstances, “unlawful” delegations may be able to be ratified (i.e. made lawful).

Under the Constitution Act 1986 any member of the Executive Council can exercise any other Minister’s powers, although in practice they do not unless agreed, such as by delegation to each other or when the duty Minister roster is in place during recess.  Ministerial delegations to other Ministers are available to Ministers in a process managed by the Department of Prime Minister and Cabinet.  

In the very rare circumstances where the decision-making power is not based in a statute or regulation, you should seek specific legal advice about how the power can be used (and who can utilise it).

A notice specifying the minimum size for lobsters was overturned because the notice was issued in the name of Assistant Director-General, and should have been issued by the Minister or Director-General.  Although the power could have been delegated to the Assistant Director-General, it had not been.
Webster v Taiaroa (1987) 7 NZAR 1