Legal Beagle by Graeme Edgeler

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Legal Beagle: It's (almost) never that simple

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  • Graeme Edgeler,

    "One of these days...
    ... I'll remember to turn comments on"
    [guess who got the "classic 39" for Christmas]

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Sacha,

    This is how this is different from an ordinary donation. If I give a party $100,000 of free polling, I may free up money for them to advertise, I might help them get elected, I might buy "access", I might help be enacted policies they've already announce which I like.

    And while those things may be beneficial to me, it's a different type of benefit to what we've got here. Radio Live gave Key/National something of value, but they got back something of value in return, and the commercial nature of that transaction may be enough to see it fall outside the legislative meaning of "donation".

    The radio company getting something more immediate in addition to the range of potential benefits you've listed does not rule those out, it only adds to them.

    And it would be interesting to see how the arrangement with the station was covered off. What constitutes consideration if no money changed hands?

    Ak • Since May 2008 • 19683 posts Report Reply

  • Graeme Edgeler, in reply to Sacha,

    And it would be interesting to see how the arrangement with the station was covered off. What constitutes consideration if no money changed hands?

    Of course, there's also the possibility that if this is seen as a commercial transaction between Key and Radio Live, that this increases the likelihood (perhaps still low) of Key being charged as a party to the unlawful broadcast of the election programme.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Ian Dalziel,

    crowd source proofing...

    Maybe it’s an inherent feature of politicians that that will (almost) anything for good publicity.

    ... that they will do (almost) anything...


    running inference...
    re the guests on that radio show (Branson, McCaw, Jackson...) can we know if they would have been on with the odious Henry, or were they special ring-ins for the 'celebrity' host - I believe the impression was given that they were Key's friends doing him a favour - perhaps the normal speaking fees of these individuals should be taken into the equation as donations as well - as I have said before, this was in effect another smiley aural billboard for Key with extra goodwill added by association to influential names (ostensibly supporting him and by implication his cause).

    also as one of his 'employers' I'd like to know what an hour of Key's time is worth, as this was hardly essential Government work, it must be publicity seeking (electioneering) - can he indicate what greater good was transferred to the populace by his skiving off from work for an hour (plus travel time) to play radio announcers?

    Christchurch • Since Dec 2006 • 7887 posts Report Reply

  • Graeme Edgeler, in reply to Ian Dalziel,

    or were they special ring-ins for the ‘celebrity’ host – I believe the impression was given that they were Key’s friends doing him a favour – perhaps the normal speaking fees of these individuals should be taken into the equation as donations as well

    Donations to whom? Key? Why wouldn't they be donations to Radio Live that Key arranged?

    Also, for the purposes of the Electoral Act, it is abundantly clear that personal time given to a campaign is not a donation.

    I’d like to know what an hour of Key’s time is worth, as this was hardly essential Government work, it must be publicity seeking (electioneering)

    So a taxpayer donation of Key's valuable time to Radio Live? I guess that's another angle...

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Ian MacKay,

    Wasn't there a case way back in Winston's Tauranga days when Bob Clarkson (?) used billboards for free since he owned them? The debate was whether the "free" use of those billboards was a donation or an election expense. The outcome of that seems relevant to a bill-board/radio broadcast.

    Bleheim • Since Nov 2006 • 498 posts Report Reply

  • Raymond A Francis,

    So a taxpayer donation of Key's valuable time to Radio Live? I guess that's another angle...

    Got to love the way lawyers minds work

    45' South • Since Nov 2006 • 576 posts Report Reply

  • Graeme Edgeler, in reply to Ian MacKay,

    The debate was whether the “free” use of those billboards was a donation or an election expense.

    Had he used billboards owned by his company, Clarkson would, in effect, have been depriving his company of money. There would be a financial cost involved, albeit not a cash cost in the same way as a donation of money. That isn't the case here. What would Bob Clarkson Construction usually charge to rent a billboard? $3,500 per month, apparently. What does Radio Live normally charge someone to host an hour of talkback? They don't. They normally *pay* someone to host an hour of talkback.

    The direct analogy would be Radio Live gifting Key an hour of advertising time, but they didn't do that (that would be illegal for other reasons). They had Key host one of their shows but retained editorial control in a way they wouldn't have had if it had been an hour given to the National Party to do with what it would. That may make all the difference.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Keir Leslie,

    But Key wasn’t engaged in any kind of commercial transaction. So that’s a problem. (It’s asymmetric. You can imagine on the one end, a real commercial transaction, where the National Party needs some cash, and so rents out Key on business terms to radio stations. That certainly wouldn’t be a donation.) But this situation seems different.

    (After all, if this was a commercial transaction, isn’t it possible for it to violate rules on the PM taking outside employment?)

    Since Jul 2008 • 1452 posts Report Reply

  • Sacha, in reply to Graeme Edgeler,

    retained editorial control

    I imagine the real degree of that will be pivotal, including who made the decision not to take calls.

    Ak • Since May 2008 • 19683 posts Report Reply

  • Graeme Edgeler, in reply to Keir Leslie,

    But Key wasn’t engaged in any kind of commercial transaction. So that’s a problem. (

    The suggestion that Radio Live didn't gain a real and direct benefit from Key's hosting is difficult to sustain. A high profile host, who brings high profile guests, is of substantial value. It wasn't a cash transaction, but that doesn't mean the barter wasn't a fair trade. Ignoring the possibility of a fine for the moment, I'd have said Radio Live did pretty well out of this deal.

    (After all, if this was a commercial transaction, isn’t it possible for it to violate rules on the PM taking outside employment?)

    No. First, the rules, such as they are, are cabinet rules that prohibit ministers doing certain things without the PM's permission. I reckon he had that. Second, a commercial transaction isn't necessarily 'employment', and ministers engage in personal commerce all the time.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Graeme Edgeler, in reply to Sacha,

    I imagine the real degree of that will be pivotal, including who made the decision not to take calls.

    I imagine that was Radio Live, who were trying really hard not to break the law. If you have the PM taking lots of calls on the radio two months before an election, someone is going to ask about politics, which was something Radio Live was anxious to avoid, thinking that would protect them from allegations of breach of the Broadcasting Act.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Sacha, in reply to Graeme Edgeler,

    Yet that was exactly what was publicised before the event. Someone changed their minds.

    Ak • Since May 2008 • 19683 posts Report Reply

  • Keir Leslie,

    It wasn’t a cash transaction, but that doesn’t mean the barter wasn’t a fair trade.

    (What follows is not perfectly formed.)

    Yeah, that's true. The problem I have is that on Key's side, he was doing it in order to get free publicity. He wasn't giving anything up in order to appear on Radio Live. (After all, he probably would have been willing to pay in order to do it, if that wasn't impossible.) So the idea that it was a barter seems a little off, no?

    The suggestion is that Radio Live swapped an hour of radio for an hour of the PM's time, right? And that because there was a swap, it's not a donation. But I don't know if I agree that the PM's time works like that.

    I'd agree that Radio Live did commercially well out of it. But I don't know if that's enough to make it not a donation.

    (This is all pretty half-baked on my end, and I am pretty convinced by your argument. But the whole things feels fishy.)

    Since Jul 2008 • 1452 posts Report Reply

  • Graeme Edgeler, in reply to Keir Leslie,

    The suggestion is that Radio Live swapped an hour of radio for an hour of the PM's time, right? And that because there was a swap, it's not a donation. But I don't know if I agree that the PM's time works like that.

    I'd agree that Radio Live did commercially well out of it. But I don't know if that's enough to make it not a donation.

    Which is basically where I got to when putting the contrary argument:

    but they got back something of value in return, and the commercial nature of that transaction may be enough to see it fall outside the legislative meaning of “donation”.

    Or maybe not. Maybe it’s an inherent feature of politicians that that will (almost) anything for good publicity. Even if Radio Live got value from John Key’s appearance, does that mean he gave something up (like normally happens in a commercial transaction)? And is that even the defining point of a donation anyway?

    Which way will the Electoral Commission and/or police and/or the District Court fall? I haven't a clue.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Sacha, in reply to Keir Leslie,

    I am pretty convinced by your argument

    I'm not, but then I'm not a judge.

    Ak • Since May 2008 • 19683 posts Report Reply

  • Graeme Edgeler, in reply to Sacha,

    Yet that was exactly what was publicised before the event. Someone changed their minds.

    Perhaps it was both. In any event, I don't think it would be determinative. If Key's people suggested it, and Radio Live agreed, that doesn't make them any less in control.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Graeme Edgeler, in reply to Sacha,

    I am pretty convinced by your argument
    I’m not, but then I’m not a judge.

    I'm not convinced either. I just know enough to know that I don't know the answer.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Sacha, in reply to Graeme Edgeler,

    it will be an interesting case

    Ak • Since May 2008 • 19683 posts Report Reply

  • Steve Barnes,

    A bit off topic but still annoyingly corrupt SkyCity conference project back on Joyce radar

    Under SkyCity's proposal, it would meet the full $350 million cost of construction but in return wanted alterations to gambling laws, including moves to extend its licence to 2021 and to have more pokie machines and gaming tables.
    ....
    Last month Steven Joyce said he believed "on the balance of probabilities" that the project would go ahead.

    So Sky City just has to promise to build a conference centre, which no doubt will be used for National's conferences and Joyce will change the law to suit them. What is that if not pure corruption?

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • merc,

    Joyce is nothing if not an interesting study, http://en.wikipedia.org/wiki/Steven_Joyce
    I'd like to know who made the approach to Radio Live for Key to feature on the show.

    Since Dec 2006 • 2471 posts Report Reply

  • Graeme Edgeler, in reply to Steve Barnes,

    So Sky City just has to promise to build a conference centre, which no doubt will be used for National’s conferences and Joyce will change the law to suit them. What is that if not pure corruption?

    Sound business practice?

    How is that possibly corruption? If National was going to get to use it free or something sure. But as you've phrased it, it's an offer that may or may not be accepted. We like to film in your country, but the tax is too high, can we get a partial rebate? I'd like to hold a function in your restaurant, what kind of discount can I get if I bring 80 people? I'd like to build a function centre, but it's a bit of a risk, especially if my current business might cease to be able to operate in a few years, can I get my licence extended early, so I'm in a position to make this investment? etc. etc.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Steve Barnes, in reply to Graeme Edgeler,

    Sound business practice?

    If Sky City thinks it a good business deal to build a conference venue then why do they need changes to the gambling laws? how is building a conference venue such a huge favour to the Government that they need a reciprocal bum lick?

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • Graeme Edgeler, in reply to Steve Barnes,

    If Sky City thinks it a good business deal to build a conference venue then why do they need changes to the gambling laws?

    That’s not what I was meaning when I said “good business practice”.

    Sky City is intending to build an expensive convention centre as part of its casino business. This is a risk. They will spend upwards of $300m on it. And they will not cover that cost is the first year of its operation, or even the first several. It is good business practice to ensure that your business will be able to remain open long enough for you to be able to actually make a profit from it. And it is sensible to make the offer to a Government that wants something like that built that “hey, we’ll build it, but we’re taking a risk, and it may be too much of a risk if the licence to operate our business isn’t renewed in a few years, so can we have it renewed early (while still allowing it to be suspended or revoked if we breach the terms)?”.

    Wellington, New Zealand • Since Nov 2006 • 3202 posts Report Reply

  • Ian Dalziel, in reply to Steve Barnes,

    Know when to fold...

    Last month Steven Joyce said he believed “on the balance of probabilities” that the project would go ahead.

    Joyce sounds like Sky City's perfect customer...


    ...another interesting (and worrying) piece in that story was:

    The Government sees the conference centre as a boon for overseas visitors.
    Conference centres seldom provide strong returns.

    as there is a strong push to get the Chch Convention Centre demolished and rebuilt quick smart... This is the Convention Centre that was run by the loss making Vbase (A City Council Holdings company) that has now been taken into (mis?)management by the Council (Note Vbase ran four venues only one remains currently operational).
    Why are we being pushed to reopen a weak earning venture (it seems the rest of the tourist industry - hospitality, airlines, etc - makes money, just not the convention centre perhaps). I'm not sure the council needs another Loss Leader right now (especially with the four directors Vbase has at the moment).
    Will we see Joyce (or Gerry by proxy) suggesting a partnership with the nearby Chch Casino (part owned by Sky City I think)?

    Christchurch • Since Dec 2006 • 7887 posts Report Reply

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