Part 3: Consequences of participating in the decision

Investigation into conflicts of interest of four councillors at Environment Canterbury.

If a member of a local authority breaches section 6(1) of the Act, the Auditor-General has the discretion to seek to have that person prosecuted if the circumstances warrant taking that step. That discretion needs to be exercised in keeping with the Solicitor-General's Prosecution Guidelines issued by the Crown Law Office. These guidelines have been in place since 1992 and are the accepted and authoritative description of how any prosecuting agency should exercise its discretion.

The guidelines issued by the Crown Law Office require both that the facts provide evidence of a breach of the Act and that it is in the public interest to bring a prosecution. Factors relevant to that assessment of the public interest include:

  • whether it is more likely than not that a prosecution will result in conviction;
  • the size and immediacy of any pecuniary interest, the damage caused, the level of public concern, and the extent to which the member’s participation influenced the outcome;
  • mitigating and aggravating factors, including any previous misconduct, willingness to co-operate with an investigation, evidence of recklessness or irresponsibility, and previous breaches, cautions, and warnings;
  • the effect of a decision not to prosecute on public opinion;
  • the availability of proper alternatives to prosecution, such as reporting publicly to the council or the public;
  • the prevalence of the offending and need for deterrence;
  • whether the consequences of a conviction would be unduly harsh or oppressive; and
  • the likely length and expense of the trial.

Although we consider that all four councillors have breached section 6(1) of the Act, we have decided not to seek to have them prosecuted. We have considered the criteria in the prosecution guidelines, and our overall assessment is that a prosecution would be unlikely to result in a conviction and it is not in the public interest to proceed. Factors relevant to that judgment include:

  • the councillors all relied on legal advice that they could participate in discussing and voting on the proposal;
  • this is the type of situation where we would have given careful consideration to an application to participate, if one had been made at the right time;
  • the councillors co-operated with our investigation;
  • there are no aggravating factors in terms of a history of breaches or warnings from us;
  • the potential financial effect of the decision was unlikely to be particularly significant for the councillors concerned;
  • previous court decisions have shown that courts are reluctant to impose a conviction in situations of this kind and will consider options such as discharging without conviction; and
  • other sanctions are available, in particular the sanction of a public report by the Auditor-General.

Therefore, we consider that, in this situation, it is enough that we are reporting our findings publicly. We would not necessarily take the same approach if a similar breach occurred again.

The Crown Law Office has reviewed our approach. It agrees that the councillors breached section 6(1) of the Act, and agrees that seeking to have them prosecuted is unlikely to result in a conviction and is not warranted in the circumstances.

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