In Re Karaka [2016] NZHC 183, a case stated from the Family Court, the High Court has held that:

• orders for reimbursement under s 135A of the Care of Children Act 2004 (COCA) are orders for "costs" within the meaning of s 45 of the Legal Services Act 2011 (LSA); and
• s 135A of the COCA is subject to s 45(2) of the LSA.

This means that a legally aided person is not required to pay costs for court-appointed lawyers or court-commissioned reports in COCA proceedings unless the circumstances are exceptional in terms of s 45 of the LSA (see at [1] and [59]). The "practical effect … is that persons who are in receipt of legal aid are unlikely to be subjected to an order for costs under s 135A" (at [2]).

This is in contrast to the recent analysis in Re Hanover [2015] NZHC 1945 at [23] ff, where the Court concluded that "the words 'order for costs' in s 45 do not include an order for contribution made in accordance with ss 131, 135 and 135A of the COCA" (at [44]). In Karaka the Court considered but declined to follow the reasoning in Hanover, instead preferring the approach in Payne v Payne (1997) 15 FRNZ 706 (HC). The Court also applied the generalia specialibus non derogant principle of statutory interpretation, along with textual and purposive analyses.

In what is effectively a postscript, the Court added (at [59], n 27):

"After the hearing [counsel] supplied a reference to a Cabinet paper, signed by the Minister of Justice, relating to s 135A of the [C]are of Children Act. The relevant portions of that paper confirm the conclusions I have reached: 'this policy will impact on the parties who will be required to pay where they have rarely done so previously … The provisions of the Legal Services Act mean that legally aided people, those least able to afford to pay, will not be required to contribute to costs, apart from in exceptional circumstances'. Office of the Minister of Justice 'Legal Assistance (Sustainability) Bill: Approval for Introduction' (19 July 2011) at [24]."

The Court described the case as resolving "an important legal issue" (at [60]), as during the hearing it had been "made clear that the apparent inconsistency between s 45 of the Legal Services Act and s 135A of the Care of Children Act is a source of concern for many Family Court Judges" (at [19]).

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