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News
Back to the news list Court told Seeka deserves the right to claim post
21 March 2019 - Media Release - Fresh Plaza

The New Zealand Court of Appeal has heard submissions that the High Court erred in its decision not to award major produce company Seeka the right to claim damages in its role as Post Harvest Operator (PHO).

The respondents in the appeal, which comprised of Strathboss (212 Kiwifruit Growers) and Seeka, put its cross-appeal forward this week, after the Crown wrapped up their appeal last week.

Seeka submitted that MAF owed it (and others) a duty of care in its capacity as a PHO, rejecting that the previous judgement which found that losses "are not of a kind that are sufficiently distinct from others who suffered economic losses in some way because orchard production was affected by Psa”.

It claimed that the interdependent relationship between it and growers does in fact mean that it is inextricably linked with the physical damage caused to fruit and to those suffering physical damage such that a duty ought to be recognised, and that a duty is consistent with the policy of the law of tort.

Last June, the NZ High Court ruled that the MPI (formally MAF) was negligent on several different occasions when it allowed Psa disease into New Zealand, after a 12-week hearing.

The plaintiffs (Strathboss Kiwifruit Ltd and Seeka Ltd) successfully argued that a shipment arrived from Shaanxi Province, China, in 2009 containing 4.5kg of pollen, anthers and other plant material that were infected with Psa - and that consignment was required by law to have been inspected by MPI at the border and biosecurity clearance should not have been granted due to material discrepancies. The concept of whether the MPI owed a duty of care to kiwifruit growers was at the centre of the court case.

The respondents went onto say the economic relationship between PHOs and growers is one of dependency, as at harvest time Seeka undertakes all aspects of the harvest for its growers, including picking fruit, providing all logistics and shipping to its packhouse, testing, grading, and packing the fruit, and cool-storing the fruit. Accordingly, the economic fortunes of the PHOs and the growers are interdependent; Seeka depends on growers for product to store and pack, and growers depend on Seeka to give advice on orchard management.

The High Court rejected Seeka’s claim for reasons of proximity and policy. It held that Seeka’s connection to MAF was not as close as the Strathboss plaintiffs, whose property interests were directly affected, and that Seeka’s losses were not “sufficiently distinct from others who suffered economic losses in some way because orchard production was affected by Psa”.

The respondent's cross-appeal also challenged the High Court's findings, to confirm that an inspection of the consignment was mandatory under both the Nursery Stock IHS and the Process Procedure.

The judgement stated that it was more likely than not that an inspection of the June 2009 consignment of anthers did not occur. The respondents submit that it was "unduly generous to the appellant (the Crown) in holding that the failure to conduct a visual inspection of the consignment was not negligent".

It was argued that if a non-compliance report (NCR) had been issued, it would have resulted in the consignment being inspected. It went on to say the High Court erred in finding that a NCR  would not have led to the consignment being destroyed or returned.

As such it was presented that "if the June 2009 consignment had been inspected, as it ought to have been, it would not have received biosecurity clearance and been dispatched to Kiwi Pollen". However, the Crown's appeal presented evidence last week arguing that no one can yet say with valid confidence whether the consignment was the cause of the Psa incursion.

The appellant earlier submitted that the High Court’s conclusions are unsound in law and fact in finding the Crown negligent, in terms of five broad “principal errors”, largely claiming MAF cannot be sued in tort directly (only vicariously), and the ruling should be reversed.


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