Being Fair in the Whirlwind of Conflict or Complaint
Author: Garth Nowland-Foreman
Anxiety levels rise, and it’s often difficult to know exactly what to do when in the midst of any kind of dispute. And it can be especially ambiguous whether you are
dealing with what is often a complex situation, in a way that meets the requirements
for that crucial (but sometimes fuzzy) concept of ‘natural justice’. What exactly does it
mean to be fair, neutral and give the parties the appropriate right to be heard?
We are sometimes asked to look into complaints involving the manager or board,
particularly when the group wants to protect an important relationship. Our
independent perspective can support the process, and we often help facilitate
resolution. Obviously, if your organisation already has a complaints policy or by-law
(or even a clause in your constitution), you should follow that. But what if you don’t,
or if what you have is inadequate in the circumstances?
Under the new Incorporated Societies Act - for which everyone needs to re-register
(almost certainly with a new constitution) before April 2026 - all incorporated
societies are required, among other things, to have a procedure for dealing with
disputes in their revised constitution (Sec 26 (j)). And that procedure must be
consistent with the rules of ‘natural justice’ (Sec 39).
Natural justice is meant to just be about ‘fairness’ with a dash of moral integrity. But
what does it actually require in practice when in the middle of a complaint or dispute?
One of the more useful bits of the, often micro-managing, new Act is Schedule
2 (https://www.legislation.govt.nz/act/public/2022/0012/latest/LMS101242.html). This
provides a natural justice ‘safe harbour’. If your procedures for resolving disputes
include all of the procedures in clauses 2-8 of Schedule 2, (and anything else you do
is consistent) your procedures are considered as meeting requirements for ‘natural
justice’ (Sec 41).
If you are an incorporated society, having dispute procedures consistent with the
rules of natural justice is mandatory after you re-register under the new act. But there
is nothing to stop you using the Schedule 2 procedures before then, or even if you
are not an incorporated society, for example, you are incorporated as a charitable
trust.
PS: If you are an incorporated society and haven’t yet started the process for
revising your constitution so you’ll be able to successfully re-register before April
2026 -- you probably need to start today!
NB: While we take all reasonable care, the information provided in this newsletter blog is
of a general nature and does not comprise legal advice. Where necessary, you
should take specific advice from qualified professionals before taking action based
on this information.