These 10 factors will drive disputes in 2017

by Sol Dolor07 Apr 2017

Several factors, including empowered regulators leaning on companies and global uncertainty, will boost the disputes space in New Zealand this year, a top firm predicted.

Chapman Tripp identified 10 factors as key dispute drivers in its “2017 Dispute resolution in New Zealand: Trends and Insights” report.

“A number of regulators have been given new powers and increased budgets and are expected to use these to strengthen enforcement,” said Victoria Heine, partner and new chair at Chapman Tripp. “Last year, we saw regulatory bodies making increasingly more ‘muscular’ decisions, and this is already evident in the first few months of 2017. Despite this, there is no major cause for concern for companies which have strong governance and management systems in place.”

The firm expects the Commerce Commission, Financial Markets Authority, Overseas Investment Office, Inland Revenue, and Serious Fraud Office to be more proactive this year, which in turn may increase regulatory intervention and consequently disputes.

Disputes may also be boosted by the practical implementation of the new health and safety regime, the firm said.

“We expect more prosecutions from WorkSafe this year, which will give businesses a better indication of the approach both the regulator and the courts will take to the question of breach and the level of sanctions,” Heine said.

In addition, acceptance and progress of mediation and arbitration as an alternative to litigation will also drive disputes. The ongoing push to expand third-party liability for commercial claims will also boost the space this year, as recent appeal cases opened the door to a new product liability theory.

Class action and third-party funding have the potential to significantly improve access to justice, Chapman Tripp said, despite having only modest and incremental effect recently. The space will likely grow, however, as adoption and regulation increase.

Global uncertainties fuelled by a changing global trading order, spurred largely by Brexit and the Trump administration, will likely increase cross-border disputes, it added.

The spread of judicature modernisation reforms, such as specialist commercial panels of judges and the wider adoption of electronic documents throughout the court system, was also identified as a driver by the firm.

It also expects more insolvency litigation due to rising interest rates as international uncertainty leaches into New Zealand. In the insurance space, natural disasters will continue to supply the volume of insurance cases.

The 2017 election will also give rise to public law actions, the firm said, as parties will increasingly resort to judicial reviews to challenge public decisions that have commercial effects.

 

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