Published in Law News (Auckland), 5 October 2026
Ten years ago, Sir Geoffrey Palmer and Andrew Butler asked me to speak at the Auckland launch of A Constitution for Aotearoa New Zealand, their first draft. They knew I would not endorse their proposal, which speaks well of them. And so, I told the room I had my doubts whether a written constitution would make this country better governed.
Ambivalence is a pleasant position until something tests it. Over the past decade, a few things have tested mine but none as hard as National’s proposal to split Foodstuffs.
I would mainly consider myself an economist but my first reaction was not an economist’s. No, it was the German lawyer in me that felt most uneasy about it.
Lawyers have strong reflexes about what a state may do to people who have broken no law, but in Germany those reflexes are written down and enforceable – not least in the constitution, the Basic Law.
The Foodstuffs proposal set all these reflexes off before I could even think of the economic implications. It is a massive intervention in many people’s professional lives and the property they hold. At the end of the process, people who own grocery stores can be told to leave the co-op they joined and trade through a structure the state prefers.
The split is not offered as a remedy for any wrongdoing.
To be fair, the proposal is not a break-up order. The Commerce Commission would draw up and assess a detailed plan for splitting the cooperatives into nationwide PAK’nSAVE and New World/Four Square businesses.
A split would need further legislation and would go ahead only on the commission’s recommendation. Owners would keep their shops and banners. Those safeguards are real but they do not change where the process points.
Meanwhile, the economist in me believes the split is the wrong answer anyway. Competition is a process, not a headcount. New Zealand’s grocery problem lies in the planning rules and the years it takes to open a large store and rearranging the incumbents changes neither of these.
That I hold both perspectives probably comes from my odd education. I came to law from economics and went into a doctoral programme in law without the degree or the state examination German lawyers normally take first. It usually leaves you arguing with yourself. On Foodstuffs, for once, both halves agree, though for different reasons.
The end of the argument
Economists lose political fights every day and that is how democracy works. You get used to it. It is harder when a decision offends your sense of justice as a lawyer.
Suppose the separation case is tested by the Commerce Commission, the objections are heard and Parliament legislates anyway. What protects the grocer, or anyone else, then? In New Zealand, once the Act is passed, the legal answer is nothing.
Some lawyers would reach for the courts anyway, and that is where my difficulty starts. Roger Partridge, who chairs the NZ Initiative, has published many columns and reports arguing that our Supreme Court has already strayed beyond its proper role. I encouraged him to write them and he is right.
Judges are meant to interpret legislation and develop the common law. Neither job lets them swap Parliament’s policy for their own and a court that changes the rules to reach a result it likes does real harm.
Yet moving power between Parliament and the courts does nothing in itself for the citizen. Both are the state and both can misuse it, though only one of them answers to voters. I am a classical liberal, so I start with the individual on the receiving end, not with which part of the state is doing it.
There are rights people ought to have, whether or not a government acknowledges them. A statute may be validly enacted and still be unjust.
Coming from a country with a written constitution, I find it unsatisfying that its passage through Parliament should end the legal argument on such matters of principle.
Here, of course, it does, and judges who pretend otherwise are doing exactly what Partridge criticises. Lord Cooke once suggested that some common law rights may lie so deep that even Parliament could not override them. The German position only sounds similar to Cooke’s. Germany’s Federal Constitutional Court enforces a text that elected representatives wrote and adopted, not a higher law that judges discovered for themselves.
The instinct behind that constitution is much older. There is a story about Frederick the Great and the miller of Sanssouci. The King wanted the windmill out of the way of his palace and told the miller he would simply take it. The miller pointed to Berlin’s high court: “You would, Your Majesty, were it not for the Kammergericht.” Even an absolute monarch faced a limit he could not decree away.
German law later made that limit explicit. The Basic Law of 1949 was written by people who had watched a parliamentary majority dismantle the Weimar Republic. Article 1(3) binds the legislature, the executive and the judiciary to fundamental rights as directly applicable law and Article 79(3) puts that principle beyond amendment.
The Nazis did not need to abolish administrative justice. They hollowed it out first and then, in 1941, set up a Reich Administrative Court over the remains. Article 19(4) of the Basic Law is the reply: anyone whose rights are violated by public authority may go to court. That means any right the law gives them, not only the fundamental rights in the constitution.
Germany then built the courts to hear those cases. Administrative justice is one of five separate branches of the German judiciary, each with its own federal supreme court. The Constitutional Court sits outside all five.
Ordinary statute
Of course, New Zealanders can take the state to court too – and they do. The Bill of Rights even affirms a right to judicial review. But it does so in an ordinary statute that yields to any other statute. In Germany, it sits in the Basic Law, and a government that wanted it gone would have to amend the constitution first.
None of that reaches the statute itself. For that, there is a second, narrower route. Anyone who claims that a fundamental right has been infringed may lodge a constitutional complaint, the Verfassungsbeschwerde, with the Federal Constitutional Court in Karlsruhe.
Usually, the other courts must be exhausted first, but where the statute itself is the grievance and there is no other remedy, it can be attacked directly. If the court agrees, the provision can be struck down or the legislature given a deadline to repair it. New Zealand has no equivalent step.
In Karlsruhe, the owners would have the fundamental rights to property, occupation and association to stand on and the legislature is bound by all three. Where property actually changes hands, Article 14 will not let the state take first and settle the bill later. Compensation must be in the same statute. Germans call it the Junktimklausel, and a law that seizes assets and shrugs the price onto an agency is void on day one.
A forced demerger is not that. Nothing passes into state hands, so Karlsruhe would treat it not as expropriation but as a redefinition of what ownership permits – which the legislature may do, provided it survives proportionality and, where the burden falls unusually hard, the owners are paid for it.
Article 14 says in the same breath that property entails obligations and that its use shall serve the public good. That is not entirely decorative prose. The Constitutional Court treats it as live law. The more a piece of property matters to other people, the more room the legislature has to regulate it.
German competition law already allows structural remedies after a sector inquiry, without any prior finding of infringement. That power reaches only dominant firms and only as a last resort.
A German court would run a standard proportionality test: is the objective legitimate, will the measure achieve it, would a less intrusive measure work as well and are the burdens proportionate to the benefits? It would give Parliament some benefit of the doubt on economic forecasts, and a well-designed measure with evidence behind it might survive.
The owners would not necessarily win. They would hold a protection an ordinary parliamentary majority could not take away.
No property right in BORA
New Zealand puts its trust in Parliament instead. Attorney-General Chris Bishop told The Law Association in August that a government which weakens property rights should say so, explain itself and say how it will soften the blow. Courts should then abide by what Parliament has decided. I agree with the last part. But it does not answer the case where Parliament knows exactly whose rights it is taking and takes them anyway.
Section 17 of the Bill of Rights Act protects freedom of association, which might catch someone forced out of a co-op. But there is no property right in the Act, and nothing like Germany’s occupational freedom.
Section 5 lets Parliament limit rights if it can justify the limit. In Hansen, the 2007 drug-supply presumption case, the court found the reverse onus an unjustified limit on the presumption of innocence and applied it anyway, because s 4 said it must.
In Taylor, the prisoner voting case, the courts went a step further and formally declared the law inconsistent with the Bill of Rights. Since 2022, the government must report such a declaration to the House and respond to it. The statute still stands until Parliament chooses to change it. An owner can win the argument and lose the shop.
The Regulatory Standards Act 2025 sets out principles covering property, compensation, proportionality and alternatives. One says that taking or severely impairing property should have to be justified. A statute that breaches those principles is still valid.
The bill that closed down greyhound racing was introduced and passed before the Act’s consistency requirements took effect, placing it outside their reach altogether. The next one will be caught. A government bringing a separation bill now has to certify, under its own Act, whether it impairs property without compensation.
That leaves the ballot box, which under our constitution is where the redress lies. Voters can punish a government. They cannot put the co-ops back together.
German law would handle all this differently, with more protection. It also fails on another level because broad rights in the hands of judges grow beyond anything their drafters intended.
Article 1 of the Basic Law, which makes human dignity inviolable, was written to make another Holocaust impossible. In February 2010, the Constitutional Court read it with the social state principle in Article 20 and ruled that the way the government set subsistence benefit rates, including those of children, was unconstitutional. A clause written against genocide now polices the arithmetic of welfare. Give a broad right 60 years and conscientious judges and it ends up somewhere like that.
Partridge’s concern thus applies to constitutional courts as well. If judges enforce limits on Parliament, judges decide what the limits mean and broad language, such as human dignity or the public good, leaves them room to insert their own views while insisting they protect someone’s rights.
A constitutional court is also the state. Its judges may be wiser than some politicians, but they lack Parliament’s officials and a process that lets anyone with an interest make a submission.
The cost
And so, 10 years on, I remain hesitant about the wisdom of having a written constitution and a constitutional court watching – and expanding it over time. Thus, I would still not sign Palmer and Butler’s text.
However, with more political interventions like the greyhound ban or now, National’s Foodstuffs policy, I am clearer about what it costs to not have a written constitution.
In the end, someone must always have the final say, and in practice the choice is between a parliament, answerable to voters, and a court.
Would I rather it sat with politicians? Watching how politics works now, not especially.
Would I rather it sat with judges? Watching how the higher courts keep widening their reach, not especially either.
Judges operating under a decent constitution – one that protects property and basic freedoms – sounds better than either. But my colleague Bryce Wilkinson has always had the short answer to that: we would make a mess of drafting a constitution today.
Ernst-Wolfgang Böckenförde, a social democratic law professor who later sat as a judge on the court in Karlsruhe, named the deeper problem in 1964: the liberal, secularised state lives by prerequisites which it cannot itself guarantee.
Those prerequisites are habits. Rights hold because enough people, in and out of office, treat certain questions as closed. A constitution can write down the principles and a parliament can observe them, but neither creates that constitutional spirit and both can undermine it.
If New Zealand had the right constitutional spirit, it could draft an excellent constitution and would not need one. Without that spirit, a strong constitution is both desirable and impossible.
A Parliament that respects the limits it is not required to respect does more for the grocer than any clause one could draft.
That is a thin thing to rely on, and it is what we are relying on.
