Sir Graham Latimer and Russell Kemp charge $260 an hour for consultancy fees

Two prominent Maori leaders did not breach any rules by accepting nearly $500,000 in consultancy fees, but their charge of $260 an hour seemed high, the High Court has ruled.
Sir Graham Latimer and Russell Kemp were taken to court by the Te Uri o Hau Settlement Trust after it alleged they breached their fiduciary duties as trustees by accepting consultancy fees of $250,000 each from the Te Arai Coastal Lands' Trust (TACL).
Te Uri o Hau entered into a joint venture with New Zealand Land Trust Holdings, to develop land it held at Mangawhai.
A joint venture company, TACL, was incorporated and the TACL Trust established to carry out the joint venture.
Sir Graham and Mr Kemp served as trustees of Te Uri o Hau as well as directors of TACL.
Around September 2007, TACL paid Sir Graham and RBT Enterprises, on behalf of Mr Kemp, $500,000 for consultancy services between December 2002 and December 2006. The payments were calculated at 20 hours a month over four years at $260.41 an hour, which Justice Geoffrey Venning said seemed high.
Te Uri o Hau said both men failed to disclose the quantum or basis of their fees, even after payments had been made.
Justice Venning said there was an issue of how the fee of $250,000 each for four years work was arrived at, and the timing of the claim for payment.
Payment was made after four years when bank funding was available but TACL was not in a strong financial position, the judge said.
"I am unable to accept that the defendants' actions and the way they approached the matter can objectively be described as reasonable, although I accept they acted honestly," Justice Venning said.
"The rate of $260 an hour approximately, is, however, difficult to justify, where the parties themselves accept they were not acting in a professional capacity."
Justice Venning noted the proposed terms of remuneration for both men were never clarified.
He said even if both men were in breach of their duties to TACL, it did not necessarily follow that they were also in breach of the fiduciary obligations owed to the trust as trustees.
"It is not enough in the present case for the plaintiffs [the trust] to identify the fiduciary obligations the defendants owed the Settlement Trust as trustees of that trust and then to claim that the duties owed to TACL and others were an extension of that duty," Justice Venning said.
He said Sir Graham and Mr Kemp's consultancy services provided to the joint venture were on top of, or additional to, the roles they had with the trust.
At a trust meeting on August 31, 2003, at which the original heads of agreement and the joint venture with NZLT were confirmed, Justice Venning said it was acknowledged Sir Graham and Mr Kemp would act as consultants to the joint ventures.
Sir Graham didn't wish to comment on the case.