Allegations
of Abuse in Institutions |
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A Wellington District Court
judge has exposed a secret deal in which the government took a cut of
millions of dollars from compensation payments to former mental hospital
patients. In a bold judgment out
this week Judge Tom Broadmore has criticised what he describes as the
"political" decision made at the highest levels of government to
secretly take 30% of the compensation payments from victims of mistreatment
at government psychiatric institution, Lake Alice, to cover non-existent
"legal fees." The former patients
were never told this was happening and the Crown's justification was
Kafkaesque, Judge Broadmore said in a judgment which orders the government to
pay out the withheld amount to one victim and opens the way for other claims.
Judge Broadmore has
chosen his words carefully as the case touches on the conduct of a group of
Wellington's most powerful public figures including Prime Minister Helen
Clark, former High Court Judge Sir Rodney Gallen, Labour government appointee
David Collins QC, now solicitor-general, and Ministry of Health chief legal
adviser Grant Adam. The background to the
case is that in 2001 Christchurch lawyer Grant Cameron won a $6.5 million
payout for a group of 95 former Lake Alice victims in a class action against
the government. As a result the government
decided to settle with a further 80 or so former patients on the same terms,
appointing Mr Collins to help the patients and former High Court judge Sir
Rodney Gallen to determine the level of compensation, as he had done for Mr
Cameron's clients. However the Ministry of
Health decided one third of the sum determined by Sir Rodney would be
deducted before the claimants found out, to keep the payouts in line with
what it believed Mr Cameron's clients had received. Mr Cameron's fee, which
has never been publicly disclosed, was said to be about one-third of his
client's payout, or about $2 million, in compensation for taking the
ground-breaking case on a contingency basis. Judge Broadmore notes
that various recipients in Ms Clark's office were kept informed about the
Ministry of Health's internal debate over this issue and Sir Rodney's
position that he disagreed with having to make deductions. "As reported by
[Ministry of Health lawyer] Christine Lloyd in an email to Mr Adam, counsel
at the Prime Minister's Office and one or two others, Sir Rodney told her
that he had not appreciated the nature of the instruction, that making any
deduction from the amount was a political decision, and he did not have
sufficient information about the basis of Grant Cameron & Associates'
charging," Judge Broadmore said. He noted that Ms Lloyd's failure to
give evidence in the hearing did not help clarify "obscurities." When Sir Rodney refused
to make the deductions, "the responsible ministers," who at that time
were Health Minister Annette King and Associate Health Minister Tariana
Turia, instructed that 30% should be taken out of the total figure after it
had been determined, but the victims were not to be told. The secret deductions
might never have come to light had it not been for a slip-up in which one
victim, Paul Zentveld, was accidentally told the full sum to which Sir Rodney
had deemed he was entitled. Mr Zentveld, who had
been admitted to Lake Alice as a young person, was told in 2002 he would receive
$115,000 in compensation, but later was rung by Mr Collins QC and told there
was a misunderstanding and this had been reduced to $80,000. Mr Zentveld took action
in the District Court to recover this money and this week Judge Broadmore
ordered the Crown to pay up $35,000. The judge said it would
have been reasonable for the claimant to assume that the issue of costs was
taken into account by Sir Rodney in making his determination. "There was no way
he could know how much a class action plaintiff with a similar history to his
had received net in the hand. Mr Zentveld said in evidence that he had not
known nor had he had any contact with any of the class action plaintiffs. He
knew only that he had suffered terribly during his time in the unit ... He simply
placed his trust in Sir Rodney to take all relevant matters into account and
to ensure that the outcome would be fair." It was not clear at
press time whether the Crown would appeal the decision, but it is likely
given the judgment came from the lower court. And the case's
implications could be far-reaching, with the Crown likely to have to pay the
second tranche of Lake Alice victims their full entitlement. That may lead to
the first tranche of victims, those represented by Mr Cameron, demanding that
the Crown cover their legal costs to keep the payouts equitable. Mr Cameron said the
government had behaved in an underhand way to save a couple of million
dollars. "The issue is the
extreme lengths to which the Labour administration has gone to keep secret
the process to take 30% off the top," Mr Cameron said. |