Re Greenpeace of New Zealand Incorporated  NZHC 77 (High Court of New Zealand, Heath J, 6 May 2011)
This was an appeal from a decision of the Charities Commission to refuse to grant registration of Greenpeace of New Zealand Incorporated (Greenpeace) as a charitable entity under New Zealand's Charities Act 2005. The Charities Commission's decision was based on a view that Greenpeace's objects contained a political purpose in 'promotion of ...disarmament and peace' and political advocacy, constituting non-independent non-charitable purposes.
Greenpeace argued that all its purposes were charitable, or in the alternative, that they were ancillary or capable of correction. It also claimed that, because it did not aim to change specific laws, its promotion of peace was not political, and furthermore 'advocacy' should be considered an appropriate charitable activity in the modern era.
The Court in this case upheld the Commission's reasoning and its decision, but did not award costs given the public significance of the case. The following outlines reasons.
Justice Heath considered that the Charities Act had not altered the common law definition of 'charitable purpose'. Accordingly, purely political objects were not charitable. His Honour referred to Bowman v Secular Society Ltd 1917 [AC] 406 (HL), which established that 'the Court has no means of judging whether a proposed change in the law will or will not be for the public benefit'. He also cited Chadwick LJ in Southwood v Attorney-General  EWCA Civ 204, who said that promoting peace as better than war is clearly beneficial and thus charitable, but particular methods of doing so suffer the same uncertainty as political purposes, and thus cannot be considered charitable.
His Honour went on to discuss a series of New Zealand authorities and the Australian case of Aid/Watch, concluding that while he found the Aid/Watch reasoning attractive, he was constrained to follow Bowman by the 1981 NZ Court of Appeal decision in Molloy v Commissioner of Inland Revenue.
Applying Molloy and Southwood, the Commission was correct to hold that 'promoting disarmament and peace' is a non-charitable purpose, despite its being a 'worthy object'. 'Disarmament' constituted a specific avenue of seeking peace, and as such could not be charitable.
A non-charitable purpose which is merely ancillary to a charitable purpose, and not an independent purpose in its own right, is permissible under the Charities Act 2005. Following Simon France J's reasoning in Re the Grand Lodge of Antient Free and Accepted Masons in New Zealand, His Honour said that both a qualitative (whether the function is capable of standing alone) and quantitative (extent to which one purpose might have greater or lesser significance) assessment must be done.
Evidence taken from Greenpeace's website indicated that Greenpeace 'sees itself as an advocate rather than an educator', campaigning for outcomes on specific issues rather than general discussion of issues in the public sphere (cf Aid/Watch). In His Honour's view, the 'extent to which Greenpeace relies on its political activities to advance its causes means that the political element cannot be regarded as "merely ancillary" to Greenpeace's charitable purposes'. (pp 28-29).
In addition, it was an independent purpose, because political activities were not required to fulfil the aim of educating the public. As such, the Commission was right to hold that this disqualified Greenpeace from registration as a charitable entity, especially given that 'the charitable purposes of Greenpeace could be met without resort to the type of political activities that deny its right to registration'.
Obiter: illegal activity
His Honour felt it unnecessary to decide a separate issue of illegal activity which had also played a part in the Commission's decision. However, he expressed the view that the evidence before the Commission could be interpreted as illegal member activity rather than illegal activity by the entity itself.
The case can be found at: http://www.nzlii.org/nz/cases/NZHC/2011/77.pdf
Implications of the case
According to Heath J, the NZ Charities Act does not displace the common law definition of charitable purpose, so political purposes of any kind will continue to defeat registration as a charitable entity.
Heath J also confirmed (albeit reluctantly) the earlier Re Draco Foundation (NZ) Charitable Trust view that Aid/Watch does not apply in New Zealand. His Honour indicated that if he were not bound by precedent, he may have taken a different view. Consequently, it appears that Aid/Watch does not apply to New Zealand, unless the Court of Appeal overrules Re Draco Foundation.
Associations seeking registration as a charitable entity in NZ should take care that any political activities are kept to an ancillary role, and aim to generate debate rather than seeking particular outcomes. However, given that both the Commission and the Court regarded the political aspects of Greenpeace's activities fatal to otherwise legitimate charitable purposes, it is arguable that if the society were to remove its political activities to a separate entity, Greenpeace of New Zealand Incorporated would be considered charitable and could achieve registration.