MEDIACOM-RELEASE-WESTCO-LAGAN

GOVERNMENT DELIBERATELY DENIES JUSTICE TO SAVE MONEY -SAYS WESTCO LAGAN

Forestry Minister Pete Hodgson has deliberately ignored the judgement of the High Court and the Appeal Court and distorted the status of the West Coast Accord in denying just compensation to parties which will lose valuable property rights following the abolition of the Accord.

A spokesman for the Minister said the Crown does not accept that the Accord confers property rights on the nation's main rimu miller, Westco Lagan, or any other miller.

Yet in 1995 the Accord was found to be a legally binding contract by Justice Greig in the High Court. Westco Lagan was a party to the litigation. The decision was upheld by the Court of Appeal in 1996, except for the Buller overcut.

It was also made clear that Westco Lagan, as a member of the West Coast Timber Association, has the standing to sue to enforce the Accord.

The company advised the Local Government and Environment Select Committee last week that the loss of its rimu contract, through the operation of its force majeur clause, would cost it around $14 million.

The Government is closing off the company's only avenue for compensation by abolishing the Accord, which guarantees a supply of sustainably harvested rimu in perpetuity. The Government's action means Westco Lagan cannot sue for damages lost profits.

"The Government is riding roughshod over our rights to fair treatment", said Westco Lagan director Grant Carruthers. "It is deliberately ignoring the judgment of the highest court in the land to avoid paying compensation for taking away our property rights.

"The Accord is a legally binding agreement, and Forestry Minister Hodgson knows it. We are angry that he is distorting its status to avoid the Crown's responsibility.

"We have tried hard to get a constructive dialogue going with the Minister, but it is clear that the Government is not interested in the legal rights of businesses or individuals. It seems that it is now OK for the Government to take away your property rights and ignore the parlous economic and financial consequences such action creates for businesses earning an honest dollar."

Apart from simply ignoring the Court of Appeal's judgment, the other reason the Minister's spokesman gave for not paying compensation was to minimise the risk of legal action against the government.

"So it seems the Government's financial interests prevail against those of its citizens and the principles of fair play and decent treatment," Mr Carruthers said.

"As the country's main miller of rimu, we've been effectively singled out by the Forests (West Coast Accord) Bill. The Government has used the law - and specifically the `Westco Lagan' clause denying compensation - to attack our interests."

Mr Carruthers pointed to recent comments from Canterbury law professor Philip Joseph, among other lawyers, who said that extinguishing contractual property rights by legislation was the same as the state taking private land. Under common law and statute, the general principle is that the state should pay when it compulsorily takes private property for public purposes.

ENDS

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