Ngai Tahu descendants benefiting from a 1996 agreement with $13.5 million paid in return for government control over cutting rights to West Southland native forest had the Maori Land Court order an investigation into how Waitutu Incorporation has managed this compensation. They allege a few of their number have benefitted improperly and also complain they have lost control of their major asset with effective control tied up in a voting trust representing untraced or deceased Ngai Tahu beneficiaries.
This 1996 agreement dealt with ongoing political fallout from colonial governments’ common practice of setting aside land of no economic value for local Maori; supposedly honouring earlier promises to leave ‘ample reserves’ for Maori owners when buying land for European settlement.
It was 1906 colonial government legislation which saw land in Southland between the Wairaurahirir and Waitutu rivers allocated to several Ngai Tahu hapu, then described as impoverished and landless. It was, and is, heavily forested with native podocarp. Even today, this land is accessible only by sea or a thirty kilometre tramp.
Descendants of these hapu now live elsewhere, with effective control of their major asset now lying with Daniel and Leonie Gale, living in Napier.
For later generations, the only way to achieve an economic return would see clear felling of their forested land. To avoid total destruction of thousands of hectares of virgin beech forest, government negotiated in the 1960s with Maori owners to achieve a conservation agreement allowing government to control managed cutting rights, with Waitutu Incorporation paid compensation.
Disputes over management of this compensation has led to decades of complaints aired before the Maori Land Court by minority interests in Waitutu Incorporation.
Reordering of the Incorporation’s financial affairs saw logging operations hived off into a separate company.
Some Waitutu members question decisions to transfer rights under the cutting rights agreement from Waitutu Incorporation to a wholly owned subsidiary, Waitutu Holding Co Ltd which initially had Waitutu Incorporation as its sole shareholder, and then later saw individual Incorporation members substituted as shareholders of Waitutu Holding Co Ltd.
Having individuals substituted as shareholders was described as enabling them to sell off their individual logging shareholdings, without affecting their shareholding in Waitutu Incorporation itself.
Also in question are interest-free loans made by Waitutu Incorporation to both Waitutu Holding Co and other unrelated companies.
There was evidence that a lack of clear financial reporting had fuelled suspicions that improper benefits had been creamed off by some members of Waitutu Incorporation.
The court was told attempts to appoint new directors to Waitutu Holding Co has been blocked by a share management trust controlled by forestry manager Daniel Gale and secretary Leonie Gale. This trust holds a forty per cent controlling block. As trustees, they hold this stake on behalf of untraced or deceased Waitutu beneficiaries; a group who exercise no control over how their votes might be exercised.
Owners representing twelve per cent of Waitutu shareholding complain they have lost control over a significant portion of their assets.
The Maori Land Court used powers in the Te Ture Whenua Maori Act to appoint an independent examiner with authority to investigate governance issues at Waitutu Incorporation, and then report back to the court.
Waitutu Incorporation has just on 1100 current members, of which nearly six hundred are described as ‘unknown’ or deceased.
re Proprietors of Waitutu Incorporation – Maori Land Court (5.09.25)
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