Forget the "jihad" against John Banks - this is much worse

John Banks' win at the Court of Appeal hopefully sheds some much needed light on the sorry state of costs in criminal cases.

Earlier today, the National Business Review reported that (paywall): “A legal expert says Crown Law should pay for the “stuff up” which misled the court in the John Banks’ trial.” It turns out that the “legal expert” in question is my colleague and Punditeer, Professor Andrew Geddis. Putting aside any quibbles I have about the accuracy of the NBR’s description of him, his thoughts on this issue are worth expanding upon.

Professor Geddis (yes, he makes me call him that) explains the details of that stuff up here (but perhaps why we shouldn’t agree with Mr Banks that he faced a “jihad”). In that explanation, he notes:

When the State prosecutes anyone - anyone - then it must do so within the rules of fair play and justice. And at the Court of Appeal in November last year, John Banks was let down by the system. That was wrong.

This is perhaps why Professor Geddis indicated to the NBR that Mr Banks “should at least get back court costs for what he spent going to the Court of Appeal”. It seems an utterly reasonable supposition, if only because that’s certainly what happens in the civil context. We even have a rule for it: “the party who fails with respect to an appeal should pay costs to the party who succeeds” (Court of Appeal (Civil) Rules 2005, r 53A(a), for the law students out there). 

Now, perhaps obviously, the rules for civil proceedings don’t apply to criminal proceedings, and for good reason: they are completely different from one another. People suing one another will entail different processes and motivations compared to the State prosecuting its citizens when they have allegedly broken the law. But that doesn’t necessarily mean that when the State "stuffs up" that prosecution or an appeal, and thus forced someone to spend a great deal on legal fees unnecessarily, the State shouldn’t help that person out with paying for those fees, just as the losing party would in a civil proceeding.

It turns out that Parliament agreed with this sentiment, or at least it did in 1967 when it enacted the Costs in Criminal Cases Act. In section 8(1), the Act states (helpfully for Mr Banks) that “the court which determines [an] appeal may, subject to any regulations made under this Act, make such order as to costs as it thinks fit.” It’s not automatic – just because Mr Banks won his appeal doesn’t entitle him to costs – but given the circumstances in which the Crown committed a “serious error of process”, this seems like a situation in which costs are justified.

No problem then, you might (very reasonably) think. We have legislation that allows a court like the Court of Appeal to award costs to someone wronged like Mr Banks. Case closed.

Or not. For the law students out there will (hopefully) have noticed the rider in section 8(1): “subject to any regulations”. It is this rider that prompted me to dip my toes into the cool waters of collegial rivalry by penning this piece, for these four words have exacted an astonishing amount of injustice that almost no one knows about, and no government wants to know about, but that I and a great many judges want you to know about.

Let me explain. There are regulations that qualify s 8(1), intended to assist the Court by prescribing the maximum amount of costs that a court can award. The problem is that the maximum amounts were last updated in 1988, allowing the mighty sum of $226 for each half-day spent in court. In 1988, I was four years old and Professor Geddis was still 43. $226 per half-day as the maximum amount payable for the costs of a criminal appeal was a laughable sum back then: it is an insulting one now.

This means that the regulations restrict the Court of Appeal to awarding John Banks, who had a day’s hearing before them, $552 - or perhaps just enough to cover the espresso consumed by his legal team. I do not know Mr Banks’ actual costs, but to help put this figure in perspective, Mark Lundy was awarded $36,649.11 in legal aid to bring a one-day appeal before the Court of Appeal last year. Given Mr Banks enlisted the services of a Queen’s Counsel for his appeal, I actually shudder to think what his bill was.

If this disparity seems ridiculous to you, then you’re not alone. Top New Zealand judges have called the situation “ridiculous” and indicated that the regulations would be illegal if they were created today.

There is a way out of this: section 13(3) of the Act allows the Court to award costs in excess of the maximum amount if it believes the appeal was especially difficult, complex or important. The problem is, however, that given the $226 per half-day figure is so low, many judges have been forced to artificially manufacture a reason why the case was difficult, complex or important – just so they can depart from the maximum amount. Such an approach completely undermines the point of the Act and the regulations, however, and judges tend to hate doing that sort of thing. They shouldn’t have to.

The Costs in Criminal Cases Regulations 1987 are a classic example of outdated regulations that have become unworkably anachronistic, but what’s worse is that the Government (and its predecessors) have known about this problem and have steadfastly refused to do anything about it. Judges, practitioners and academics have long been calling for reform - it wouldn't be hard, after all - but when an occasion recently arose to change the maximum amounts when the Government enacted the Costs in Criminal Cases Amendment Regulations 2013, it noted that the amendments were simply to harmonise procedure, and “[t]here is no change in the amounts payable as fees.”

That upgrades the neglect of these Regulations from simple forgetfulness to wilful blindness. There are many defendants who are unnecessarily prosecuted by the State or win their appeals, like Mr Banks, because the State has “stuffed up”, but simply don't get the same media attention as he tends to. What they all share in common, however, is that despite their success, they are left with nothing more than pocket change to pay for their legal fees. Mr Banks may well think that he has suffered a jihad-level injustice. Unwittingly, and thanks to the comments of my colleague, hopefully you are now aware of a much, much bigger one.