Court slates IRD chief's denial tactics

By MATHEW DEARNALEY

Inland Revenue Department chief David Butler has been criticised by the Employment Court for ignoring a finding in favour of an employee who called Mr Butler's predecessor a liar.

Chief Judge Tom Goddard said he accepted "in their entirety" submissions by former tax officer Keith Burns that Mr Butler ignored a decision of three employment judges by arguing over the relevance of facts about a letter from former chief executive Graham Holland.

"There was not a word of contrition or acceptance of the full court's ruling, but instead the respondent continued in a state of denial," Judge Goddard said in the latest chapter of a legal saga that has bounced between him and the Court of Appeal.

Mr Burns, who worked for the department for 31 years until taking voluntary redundancy in 1999, sued it for $120,000 over earlier demands by Mr Holland that he withdraw an allegation against him of acting dishonestly in response to previous grievances.

Mr Holland denied lying and told Mr Burns, who worked in Dunedin as a taxpayer services officer, that he risked dismissal unless he retracted his allegations.

A full bench of the Employment Court ruled in a landmark preliminary decision in 2001 that an employer could not discipline an employee for the way a personal grievance was expressed, as this would inhibit a statutory right.

But instead of appealing against the decision, the department used two lawyers and took five ring-binders of correspondence to try to justify its actions to a subsequent hearing last year before Judge Goddard.

The judge described two letters which Mr Holland sent to Mr Burns as quite inappropriate for the head of a Government department to write to an employee, saying they amounted to improper pressure to withdraw a grievance claim.

He ordered the department to pay compensation of $7500, but Mr Burns challenged the award in the Court of Appeal, arguing that he should receive punitive damages as well.

The appeal judges dismissed the challenge in June, ordering Mr Burns to pay $5000 costs to the department after it argued successfully that he could have shortened the case by accepting an out-of-court offer of $15,000.

The case then returned to Judge Goddard to decide whether to award the department costs for defending itself at the second hearing before him.

Instead of granting the department any more, the judge accused it of dragging out the hearing with unnecessary evidence and putting Mr Burns "though the mill" with cross-examination on "every technical point imaginable".

"I am not persuaded that the respondent's application of resources to this case was objectively reasonable or anything like it."

He said this was not a criticism of the lawyer who led the department's defence, Tony Couch, who he said was "obviously acting under firm instructions".

Noting that the department was up against a man of relatively modest means, with a net weekly household income of $415 and a dependent child, Judge Goddard ordered it to pay Mr Burns expenses of $1050.