Settlement a 'gutless climbdown'

Lee Vandervis
Lee Vandervis
The decision to settle a defamation claim against Dunedin Mayor Dave Cull by two former Otago Rugby Football Union officials is a "gutless climbdown", a Dunedin city councillor says.

Cr Lee Vandervis yesterday criticised the settlement which resulted in Mr Cull apologising to Wayne Graham and Laurie Mains - despite not admitting liability - and the Dunedin City Council paying $29,000 towards their legal costs.

Some councillors contacted yesterday would not comment, citing the sensitivity surrounding the issue, but others expressed relief the matter was now closed.

Cr Vandervis said the claim should have been fought in court, despite legal advice warning of the potential risk to ratepayers.

He and Cr Fliss Butcher opposed the settlement when it was considered during the non-public part of a council meeting on September 17, but were outvoted by their colleagues.

"I don't believe that they should ever have got a dollar out of us that they didn't have to fight for through the courts," he said.

"I consider it a fairly gutless response to have actually just taken the legal way out.

"To me, there was a moral question and a political question, and those questions weren't addressed."

He did not accept the legal advice presented to councillors and believed Messrs Graham and Mains should have been told "to do their absolute best".

"They claimed to be going for $1 million and settled for $29,000. I don't think they believe they had a case either."

The legal action came after Mr Cull criticised the performance of the former ORFU board in a Radio New Zealand interview on March 15, the day after the council agreed to wipe a $480,000 bill owed by the ORFU.

It was confirmed on Friday a settlement had been reached, with a copy of the agreement and other documents released, including Mr Cull's apology for any "distress or harm" caused to either man.

Cr Butcher - who also opposed the deal - could not be contacted yesterday, but Cr Kate Wilson said she was "relieved it's all over" so councillors could move on.

"I think it's a distraction we don't need and it's very unfortunate.

"I think people want us to focus on much more important things in Dunedin."

However, she believed Mr Cull's comments had reflected the frustrations around the table during the ORFU bail-out debate.

Cr Teresa Stevenson agreed, although the wording he chose "was not as diplomatic as it could have been".

She accepted the deal was "the most prudent option", although "I couldn't say I was happy with the situation".

"But I would have been much more unhappy if it had cost the ratepayers a lot more."

The decision by Messrs Graham and Mains to seek damages in the first place - and so soon after the union had been rescued from liquidation - was "unfortunate", Cr Stevenson said.

"It causes a greater cost for the ratepayer when the ratepayer has already put a considerable amount of money into this matter."

Crs Syd Brown and Richard Thomson declined to comment, while Cr Neil Collins said he had views "but we're told not to share them".

Other councillors did not return calls.

Full settlement not disclosed

Rob Hamlin makes a good point that as well as the legal costs of the ORFU officials, there is the potentially much larger cost to the city of the settlement. There has been nothing revealed about the size of the settlement (if any) nor any mention of the DCC's legal costs.

The DCC has apparently stated that they are "paying $29,000 towards their legal costs". Careful readers and those familiar with the DCC's methods will know that this statement is fundamentally different to saying that "the total payment for their legal costs will be $29,000".

Over the last few years the DCC has made a number of statements like this that are technically true but very misleading to the public. A good example of this pedantic slipperiness is their official statement that "the ratepayer contribution towards funding the stadium will be $5 million per year". The DCC wanted us to think that $5 million was the total amount, and so the statement failed to mention the other $10 to $15 million of "ratepayer contributions" that are now becoming obvious.

The DCC's culture of spin-doctoring means that nothing they tell us should be believed unless there is good evidence to prove it.

Credit where it's due

To all those heaping adulation upon Cr Vandervis. Go back and re-read the story. There was a second councillor who stood beside Cr Vandervis and so far no one has had a thing to say about their stance. Congratulations to Cr Butcher. [Abridged]

Debate in court

I too believe the Mayor and council should have let this matter be decided by a court. This matter needs to debated in open court for all to see rather than behind closed doors at council meetings. [Abridged]

Is that all?

We are informed that the DCC paid these two gentlemen $29,500 towards their legal costs. I am not sure if legal costs for cases that are settled out of court would be covered by a legal indemnity insurance policy. Costs in this kind of out of court settlement situation come in three categories: Plaintiff's costs, defendant's costs and the monetary value of any settlement made.

So far we only appear to have had specific confirmation of only one of these three. Not admitting liability does not necessarily mean not paying out - sometimes in a big way. It would therefore be most interesting to know if the insurance company also paid money as a settlement to these two gentlemen on Mayor Cull's (and as this ratepayer funded policy covered him in his professional capacity) by inference this community's behalf.

I suppose that it would be too much to expect to be told how much might have been given out on our behalf given the current climate of secrecy that surrounds this Council's affairs. However, just a simple 'yes' or 'no' in answer to the question - 'Was any direct settlement made to these two gents on our behalf?' does seem to be a reasonable expectation, as the community did fund the policy. [Abridged]



Who wins?

Lawyers the only winners.

Ratepayers cover Council costs and those of Mains and Graham. What were the council's total costs in the matter? The Mayor will say of course he has acted in the best interest of ratepayers. [Abridged]

Weakness shown by council

The kind of comments from councillors that this case was a needless distraction or that they were saving us money by not going to court is spurious and misses the point. Cr Lee Vandervis is right. It was a gutless response. Shame on the council for being so weak. [Abridged]

Time to move on

Cr Kate Wilson says, "she is glad it is all over and it is time to move on." Does this mean we can expect a well-earned resignation? Cr Vandervis is the only councillor around that table with the nous to see the underlying harm done to the city's mayoralty by Mayor Cull's letter.  [abridged]

Speaking the truth

What can one say? It would seem that the good ol' rugby boys have the people who run this city wrapped around their little fingers. [Abridged]

ODT/directory - Local Businesses

CompanyLocationBusiness Type
A J McKenzie & Co LimitedDunedinAccountants
Wall 2 Wall Amusement ArcadeMosgiel
Performance CarsDunedinCar Sales