Editor: I. Mallikarjuna Sharma Volume 11: 15-31 March 2015 No. 5-6

F-192 Quake Outcasts v. Minister for Canterbury Earthquake Recovery [NZ-SC: Eliyas CJ] (2015) 1 LAW
authorise an appropriation under the Public
Finance Act 1989). As the Court of Appeal said
of this argument, obtaining the necessary
financial authority to comply with the Public
Finance Act did not detract from the fact that the
offers themselves were made by the chief
executive under s 53.
[261] Reconsideration of the exercise of the s 53
powers will have to address the circumstances as
they now exist when taking into account the
purposes of the Act in promoting recovery. That
may well require consideration of the delay and
its effect and the hardship caused by depopulation
of the red zone in the meantime, with associated
running down of its infrastructure and
amenities. 277 Given the fact that the decision has
to be taken over again on a wider basis, it is not
appropriate to enter into assessment of the factors
that will be relevant, beyond indicating what they
may include in dealing with the points raised by
the present appeal.
[262] The appellants were granted leave to appeal
on two points. 278 I deal with them in reverse order
to the order in the leave judgment. The first is
whether there was a rational basis for the
distinction drawn between those owners who
were insured and those who were uninsured. The
second is concerned with lawfulness of the
establishment of the red zone and the Crown
alternative responses: that the zone had no legal
effect and was simply the provision of expert
information obtained by the Crown as to the
physical consequences of the earthquakes; and
that the Government decisions were in any event
ones that it was able to take outside the
framework of the Canterbury Earthquake
Response Act.
(1) Was insurance a proper basis for distinction?
[263] The appellants have challenged the finding
of the Court of Appeal that there is no reviewable
277 See also the points made by the Court of Appeal referred
to by me at [257]-[258].
278 Quake Outcasts v Minister for Canterbury Earthquake
Recovery [2014] NZSC 51.
error in the approach which differentiates
between the appellants and those who received
offers amounting to 100 per cent of the 2007
rateable value of their property on the basis of
whether or not they were insured. This
determination was fatal to the attempt to obtain a
direction from the Court of Appeal, in application
of a principle of even-handedness, that the Crown
pay the appellants who wished to sell 100 per
cent of the rateable value of their properties.
[264] The Court of Appeal held: 279
[150] We accept that there is a rational basis for
differentiating between insured residential
property owners and uninsured owners such as
the respondents, given the potential value to the
Government of the rights against EQC and
insurers that were assigned to the Government
under the contracts resulting from the 100 per
cent offers. That is the very differentiation made
in the June 2011 decision and the September
2012 decision. We do not accept that the mere
fact that a different approach was taken in
relation to the respondents than in relation to the
recipients for 100 per cent offers constitutes a
reviewable error.
This conclusion, it seems to me, is a statement of
the obvious.
[265] The Court of Appeal was careful not to
express any view on the weight reasonably to be
given in the comparison of the treatment of the
insured and uninsured property owners to the lack
of comparable off-set provided by recovery of
insurance. It could not properly have done so
given the view that the circumstances needed
reconsideration in the light of s 3 and especially
the recovery principle.
[266] In any such further comparison it may be
necessary to confront the fact that, as the Court of
Appeal said, the Cabinet papers associated with
the June 2011 offer do not seem greatly to have
emphasised the recovery of insurance. 280 In those
279 The Minister for Canterbury Earthquake Recovery v
Fowler Developments Limited [2013] NZCA 588,
[2014] 2 NZLR 587.
280 At [149].
Law Animated World, 15-31 March 2015 134