LEGAL SERVICES AGENCY V SYLVA HC AK CIV 2008-404-1645

LEGAL SERVICES AGENCY V SYLVA HC AK CIV 2008-404-1645 4 November 2008IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2008-404-1645UNDER The Legal Services Act 2000 IN THE MATTER OF An appeal from a decision of the Legal Aid Review Panel dated 22 February 2008 BETWEEN LEGAL SERVICES AGENCY Appellant AND MAMAI JACQUELINE JET SYLVA Respondent AND NEW ZEALAND LAW SOCIETY Intervener Hearing: 10 July 2008 Appearances: G Taylor for Appellant C Gudsell QC and C Simes for Respondent M Scholtens QC for Intervener Judgment: 4 November 2008 at 12:30 pmJUDGMENT OF ASHER JThis judgment was delivered by me on 4 November 2008 at 12:30 pm pursuant to Rule 540(4) of the High Court Rules .. Registrar/Deputy Registrar .. DateSolicitors: Bartlett Partners, PO Box 10-852, Wellington (PJ Ryder-Lewis) GDS Taylor, PO Box 5294, Lambton Quay, Wellington C Simes, PO Box 4265, Hamilton 3247 Legal Aid Review Panel, PO Box 33-837, North Shore 0740, Auckland (J Maze/R Morris) Waikato Bay of Plenty District Law Society, PO Box 180, Hamilton MT Scholtens QC, PO Box 5454, Wellington CT Gudsell QC, PO Box 19085, HamiltonTable of ContentsParagraph NumberIntroduction [1]Background [2]The scope of review and appeal [8]The decision of the Panel [12]The issue [15]The scheme of the Act [20]Policies and guidelines on travel costs [24]The reasoning of the Panel [28]The lawfulness of guidelines [32]Principles to be applied [32]The words of the guidelines in this case [42]Exceptional versus special circumstances [47]Manifest unreasonableness [53]Result [58]Costs [59]Introduction[1] The Legal Services Agency ("the Agency") appeals against a decision of the Legal Aid Review Panel ("the Panel") in which the Panel reversed a decision of the Agency refusing to approve a travel disbursement of $115.40. The appeal raises the question whether it is lawful for the Agency to set and adhere to detailed guidelines as to the grant of travel expenses (with an overriding discretion limited to exceptional circumstances). The parties and the intervener agree that the issue involves an important question of law.Background[2] The applicant is Ms Mamai Jacqueline Jet Sylva. She has three children aged fifteen, six and three, and lives on a farm five kilometres from the small town of Whatawhata, which is on State Highway 23 west of Hamilton. On Wednesday 7 November 2007 the applicant was allegedly seriously assaulted by her husband. As a result of the incident her husband was arrested and charged. [3] On Friday 9 November 2007 Ms Sylva instructed her lawyer Ms Cheryl Simes, a Hamilton barrister, to seek protection and parenting orders on her behalf. Ms Simes was listed with the Agency as a person approved to provide legal services ("a listed provider"). Ms Simes determined that the application was urgent. As to the circumstances of incurring the travel disbursement, I quote from the decision of the Panel at [7]: [Ms Simes] had a full work schedule for the following week and elected to see the Applicant on the weekend. The Applicant lives in a rural area approximately half an hour's drive from Hamilton. She did not own a vehicle, and at the time there was no-one she could call on to transport her. Her home is some five kilometres from the nearest bus route, which is the main road. She had no access to childcare facilities, and having regard to the ages of her children, walking to the main road was unrealistic. Accordingly, the listed provider arranged to travel to the Applicant's home to see her.[4] Ms Simes arranged for a Justice of the Peace to accompany her on her visit. She drove to Ms Sylva's home on Sunday 11 November and then and there prepared the necessary documents using her computer and printer which she had brought withher. She had them sworn in front of the Justice of the Peace in the same visit. She then returned to Hamilton. The documents were filed in the Family Court on Monday 12 November 2007 and a temporary protection order and interim parenting order were made on that day. [5] Ms Sylva's application for legal aid was filed with the Agency on Tuesday 13 November 2007, and guideline fees were approved. On 25 November 2007 Ms Simes submitted an interim tax invoice together with an application for amendment of the legal aid grant. The application for amendment requested 1.2 hours of travel time and travel disbursements of $43.40 together with a telephone disbursement. The total amount claimed for travel costs was $115.40. [6] The Agency set out its decision in a letter dated 27 November 2007. It declined to approve the travel costs. It stated in its letter to Ms Simes:In accordance with the Agency's travel policy (see Part 7, pages 7.13-7.22 of the Provider Manual), travel costs have not been approved for the following reasons:• The legally aided person is not detained in custody.• The travel is considered to be local travel within the Hamilton area.• Exceptional circumstances do not include everyday situations such as the client not having access to a car or childcare etc.[7] Ms Sylva then applied for a review of this decision by the Panel under s 54 of the Act. The application was filed on 12 December 2007. The Agency filed a detailed submission by letter on 20 December 2007 and Ms Simes responded on 4 January 2008. In its decision of 22 February 2008 the Panel held that the Agency's decision to refuse the application to pay travel costs was both wrong in law and manifestly unreasonable. The Agency appeals against that decision. The general ground put forward in the notice of appeal was that the Panel exceeded its jurisdiction.The scope of review and appeal[8] An aided person can apply to review a decision of the Agency to the Panel under s 54(3) of the Legal Services Act 2000. The grounds are limited. The application can be made only on the basis that the decision is manifestly unreasonable or wrong in law. [9] The Panel is established under s 62 of the Act. Its members are appointed by the Attorney-General. Its convenor must be a lawyer who has held a practising certificate for at least seven years. In the present case two Panel members were appointed, both of whom were qualified in law. Under s 56(5) of the Act the review must be conducted on the papers with all reasonable speed. The Panel must give a brief summary of its reasons for the decision: ss 57(2) and (3). [10] Under s 59 of the Act either the Agency or an applicant, if it is considered that the Panel's determination is wrong in law, may appeal to the High Court. The appeal can only be on a question of law, and the appeal must be dealt with in accordance with the High Court Rules. [11] Mr Gudsell QC appeared in this appeal for Ms Sylva, having been instructed by the Waikato Bay of Plenty District Law Society. The New Zealand Law Society was given leave to appear as an intervener, without opposition from any party and was represented by Ms Scholtens QC.The decision of the Panel[12] The Panel determined that under the relevant Agency guidelines in relation to travel costs, an applicant had to show exceptional circumstances before travel costs would be paid in relation to exceptions not specifically covered by the Agency policy. It held that the Agency approach in requiring exceptional circumstances was unlawful. The Panel held rather that only special circumstances needed to be shown. It stated:[23] Both the Applicant and the Agency have premised their submissions on the basis that exceptional circumstances need to be demonstrated. This approach is understandable, because that is what the Agency'stravel policy states. However, in this regard the Agency's policy is wrong. As is clear from the decision in Minchington (supra), to go outside the Agency's policy special circumstances only need be shown, not exceptional. [25] For the Agency to require applicants to show exceptional circumstances exist for travel costs to be paid outside the Agency's policy, is wrong in law [13] The Panel then went on to consider whether Ms Sylva had made out special circumstances. It held that she had, and referred to the following factors:(a) The applicant lives in a rural area, and both she and one of her children had been assaulted by her husband. (b) The applicant required urgent protection and parenting orders. (c) The applicant has young children and her distance from the nearest bus route made public transport unrealistic. She was without a vehicle, and her father (who would usually transport her) was away. (d) The applicant's listed provider was able to attend personally at the applicant's home on the weekend, to enable the necessary Court documents to be prepared and filed on the Monday.[14] The Panel also found that in the circumstances the Agency's decision to refuse to pay travel costs was manifestly unreasonable.The issue[15] The Agency accepts that the decision to not pay Ms Simes' travel costs was an error and has in fact paid her. Nevertheless, it asks in its notice of appeal that the decision of the Panel be set aside. In oral submissions it did not press for such an order, but nevertheless strongly pursued the appeal because of the importance of the issues that arise. Mr Gudsell QC for Ms Sylva and Ms Scholtens QC for the New Zealand Law Society were content for the appeal to proceed on this basis. [16] Mr Taylor expressed the issue in his submissions as:Is it unlawful for the Agency to condition departure from policy by reference to any test other than 'special circumstances'?[17] The issues that arose went further than this specific question. It became clear in submissions that the Panel was wrong in the fundamental distinction it made with reference to the guidelines between exceptional circumstances and special circumstances. This is because special circumstances are specifically referred to in the relevant Agency guidelines as a basis for departing from the guidelines. So the correctness of the Panel decision must be questioned on this further basis. [18] There was also reference in the submissions to the recent decision of Creedy v Commissioner of Police [2008] 3 NZLR 7, where the Supreme Court appeared to accept that the term "exceptional circumstances" was not materially different from circumstances that were special or uncommon. Thus, there is a further issue of whether exceptional circumstances mean anything different from special circumstances. [19] In practical terms, if the Panel's decision is not set aside the Agency will be acting unlawfully where it fetters its discretion by setting out policy guidelines and reserves the exercise of its residual discretion to exceptional circumstances. Mr Taylor asserts that this has wide implications not only for this policy but for a number of Agency policies.The scheme of the Act[20] There are two key relevant provisions as to how the legislation in this context is to be interpreted. The purpose of the Act as stated at s 3(a) is to promote access to justice by "providing a legal aid scheme that assists people who have insufficient means to pay for legal services to nonetheless have access to them". Section 92(a) states that a function of the Agency is "to administer schemes in as consistent, accountable and inexpensive, and efficient a manner as is consistent with the purposes of the Act." [21] The critical section relating to the Agency's approval of disbursements is s 75(1). It provides:75 Agency may approve, defer for examination, or decline payment of claim(1) On receiving a claim for payment from a lead provider, the Agency may— (a) approve the claim or any part of it; or (b) defer payment of all or part of the claim in order that the deferred part may be examined; or (c) decline payment of the claim or any part of it.[22] The word "may" gives the Agency an open discretion. No other provisions cover the basis for the approval of claims for disbursements. Further, there is no specific reference to the creation of policy guidelines for such a purpose. Sections 9, 14 and 24 of the Act all refer to applications and the basis on which they are to be granted, but do not set out criteria for the granting of disbursements such as travel costs. Section 4, which defines "costs of services", states under (c) that the disbursements claimed by the lead provider and any other listed provider are part of the costs of services. Section 74(c) states that the lead provider must show disbursements in a claim for payments. None of these provisions cast any light on the basis upon which the discretion to approve disbursements is to be exercised. [23] Further, there is nothing in the Act giving the Agency the express power to create policy guidelines or rules. Indeed there is no reference to guidelines or rules in the Act.Policies and guidelines on travel costs[24] The Agency states in its submissions that it makes between 100,000 and 200,000 decisions each year in relation to "debts and repayments, and on its management of the process of listed providers". Unsurprisingly, these decisions are made by officers employed by the Agency. The Agency has four manuals which deal with decision-making. One of those manuals, the Grants Legal Aid Manual, provides for claims for travel costs. The relevant sections of the Grants Legal Aid Manual state a general policy in some detail and then set out specific directions as to when travel costs will or will not be paid. [25] The travel policy is set out in both the "Travel Grants" and "Travel Provider" sections of the Grants Legal Aid Manual, and the relevant wording in the twosections appears to be identical. The introduction to each section states that the Agency's aim in paying for travel is to ensure that a provider is covered for the necessary expenses incurred as part of the legal aid assignment when the provider cannot reasonably absorb those expenses. The Manual goes on to state that as a matter of general policy the Agency considers travel to be part of the expected overheads of a provider. Under the heading "Policy" it is stated that the Agency will generally not consider payment for travel within metropolitan areas and towns. [26] It is then stated under paragraph 2 under the heading "Policy":2. The Agency will consider a payment for travel in situations where:ƒ The travel payment relates to travel to a rural or distant court, where travel distances are significant and, unless there are special circumstances, where a provider closer to the court cannot be assigned or reassigned, orƒ The travel payment relates to a case being moved to another court; orƒ The client is detained and the provider is required to attend the client at their place of detention (this includes prisons, mental health institutions, refugee detention centres, etc.),ƒ It is demonstrated that not to do so would compromise the applicant or the legally aided person's access to justice, orƒ Exceptional circumstances are demonstrated.[27] The policy states that local travel is generally not paid. Under the heading "Access to justice" it is stated that access to justice might be compromised if the client was denied effective legal representation because the provider will not travel unless paid and the agency cannot offer another reasonable option. Then there is a further heading, "Exceptional Circumstances". This section reads as follows:Exceptional circumstances1. The policy allows Grants Officers to use their own discretion when deciding whether travel will be paid if exceptional (or special) circumstances have been demonstrated by the provider. These vary from case to case and each request must be considered on its own merits. 2. To make this decision, take the following into account:ƒ Assess whether any other part of the policy applies; orƒ Whether other options instead of travel could be used (see below) 3. When assessing exceptional circumstances, consider whether the travel requested will benefit the legally aided person. Assess:ƒ The needs of the aided person;ƒ The fairness and convenience of any alternative arrangement to the aided person. 4. Some examples of exceptional circumstances may be:ƒ The legally aided person or other person significant to the case is physically unable to travel to see the lawyer so the lawyer must travel. Temporary hospitalisation would be an example. Everyday situations such as not owning or having access to a car, or not being able to arrange childcare would not count here as an exceptional circumstances.ƒ The other party is in another locality and there is no option for the provider but to travel to complete the case for their client.ƒ A local lawyer is unable to take or complete an assignment because of a conflict of interest and a lawyer from another locality must be assigned.ƒ The case requires a special legal expertise that a local lawyer does not have or it is not available at the time the case arises.ƒ There is no local lawyer available at the appropriate proceedings category.ƒ There are not enough local lawyers to cover the duty solicitor roster.ƒ Some other event has occurred that was not foreseen at the time the assignment was accepted but now necessitates travel. [emphasis added]The reasoning of the Panel[28] The Panel's decision turned on two matters. First, there was the assumption that the Grants Legal Aid Manual set out a policy and guidelines that could only be departed from in exceptional circumstances. The second was that the limiting of the discretion to "exceptional circumstances" was unlawful. It assumed, however, that an exception of "special circumstances" would be lawful.[29] It is clear that the Panel's focus on the lawfulness of "exceptional circumstances" did not arise from any argument put forward by counsel for the Agency or Ms Sylva. The Agency's submissions focused on whether the decision of 20 December 2007 not to approve the request was manifestly unreasonable. It dealt in detail with factual matters. Ms Simes' reply of 4 January 2008 responded in detail to the factual assertions, and focused on the issue of whether as a matter of fact the disbursement was reasonable. She specifically noted in her conclusion that she had not had time to make submissions on the interpretation of exceptional circumstances as compared with special circumstances or other similar phrases, while stating that she expected that "exceptional" was stronger than "special". She did not suggest that the policy and guidelines were unlawful in themselves. [30] The lack of any submissions on the point may have been what led to the Panel failing to appreciate that the definition of exceptional circumstances in the policy document is "if exceptional (or special) circumstances have been demonstrated". Thus, the guidelines do in fact provide for "special circumstances" being sufficient to warrant a departure from the guidelines. Therefore the premise upon which the Panel decision was based involved an incorrect interpretation of the guidelines. That was an error of law. [31] Less straightforward is the question of whether the Panel was correct to conclude that a discretion limited to "exceptional circumstances" was unlawful. The submissions of counsel mainly focused on this particular question. Mr Taylor in his submissions emphasised the practical consequences of the Panel's conclusion on the lawfulness of a discretion limited to "exceptional circumstances" and observed that the legal aid Provider Manual has 25 references to such exceptional circumstances that, it was submitted, would fall foul of the Panel's decision.The lawfulness of guidelinesPrinciples to be applied[32] It is well recognised that there can be no legal objection as a matter of principle to a public body such as the Agency putting in place policies or guidelinesrelating to the exercise of a discretion, providing they are in conformity with the Act and leave sufficient room for the proper exercise of the discretion in individual cases. This principle was formulated in British Oxygen Ltd v Board of Trade [1971] AC 610 (HL), a decision which has often been followed in New Zealand: Westhaven Shellfish Ltd v Chief Executive of Ministry of Fisheries [2002] 2 NZLR 158 (CA) at [39], [45] and [48]; Legal Services Agency v Minchington [2003] 1 NZLR 263 at [16]; Legal Services Agency v Fainu (2002) 17 PRNZ 433 at [40] and [41]. These cases recognise that ministries and government authorities can set policies or rules where a multitude of similar applications have to be processed, and guidelines are the only practical way of ensuring consistency and fairness. Both Minchington andFainu specifically involve policy guidelines issued by the Agency under the Act. As Chisholm J stated in Legal Services Agency v Minchington at [16]:Given the volume of applications calling for consideration and the number of grants officers it would be unrealistic to think that the agency could properly discharge its statutory functions without formulating policies or guidelines and reviewing and updating them from time to time. On the other hand, the grants officers have to keep firmly in mind that the policies or guidelines can never be elevated to a level where they are effectively used as a substitute for the correct statutory approach in individual cases: Society for the Promotion of Community Standards Inc v Waverley International (1988) Ltd[1993] 2 NZLR 709 at pp 721–722.[33] I respectfully agree with those observations. In that case Chisholm J observed that a policy not to grant aid for charges laid under the Summary Offences Act 1981 unless there were "special circumstances" was not unlawful. [34] There must be sufficient room for the proper exercise of discretion in individual cases despite non-compliance with guidelines. Lord Reid addressed this issue in British Oxygen Ltd v Board of Trade at 624-625, and quoted Bankes LJ in R v Port of London Authority, ex parte Kynoch Ltd [1919] 1 KB 176 (CA) at 184 with approval. The passage read:There are on the one hand cases where a tribunal in the honest exercise of its discretion has adopted a policy, and, without refusing to hear an applicant, intimates to him what its policy is, and that after hearing him it will in accordance with its policy decide against him, unless there is something exceptional in his case. I think counsel for the applicants would admit that, if the policy has been adopted for reasons which the tribunal may legitimately entertain, no objection could be taken to such a course. On the other hand there are cases where a tribunal has passed a rule or come to adetermination, not to hear any application of a particular character by whomsoever made. There is a wide distinction to be drawn between these two classes. [emphasis added][35] As Lord Reid observed, the circumstances in which discretions are exercised vary enormously, and the statement of Bankes LJ cannot be applied literally in every case. The general rule is that anyone who has to exercise a statutory discretion must not "shut his ears to an application": British Oxygen Ltd v Board of Trade at 625. [36] The drafting by public bodies of policies relating to the exercise of discretionary powers was scrutinised by Tipping J in Practical Shooting Institute (NZ) Inc v Commissioner of Police [1992] 1 NZLR 709. After a careful review of the authorities including British Oxygen Ltd v Board of Trade Tipping J suggested that there are two or possibly three categories into which discretionary powers of this kind may fall. The first is those powers requiring an individual case-by-case examination without any predetermined fetter. The second is those powers which (at 718):By dint of the nature of the subject matter justify the establishment as a matter of discretion of a carefully formulated policy, but always with the reservation that no case is to be rejected automatically because it does not fit the policy. In this category all cases must be considered to see if they are sufficiently special to warrant a departure from the general policy.[37] The third category represents cases where the discretionary decision-maker is implicitly authorised to exercise his discretion to establish an immutable policy admitting no exceptions. As Tipping J acknowledged, it is possible that the third category does not exist. [38] Mr Gudsell for Ms Sylva submitted that the merits of the application alone should govern the outcome of any application, and that any threshold test devolved from a policy could give rise to injustice. They would place the grant of travel expenses in the first category where no detailed guidelines would be permitted. I do not consider this submission to be correct. [39] As earlier observed, the Act gives no guidelines (or guidance) as to the basis for granting legal aid and travel costs. However, there are the general requirementsthat access to justice be maintained and that the Agency administer schemes in as consistent, accountable, inexpensive and efficient a manner as is consistent with the purposes of the Act. The inevitably large number of applications processed by the Agency, and the fact that they must be administered by a considerable number of different grants officers, means that consistency and efficiency demand guidelines. If each application were considered without guidelines as a consequence of an unguided merits-based approach, there could be wild oscillations in result. A much greater danger of unpredictability and inconsistency would arise, which would not be in the interest of the public, or access to justice, and contrary to the purpose set out in s 3(a). Applications would take longer to process, and there would thus be added expense and a greater likelihood of delay, contrary to the function of the Agency referred to in s 92(a). [40] Mr Gudsell relied on the Australian decisions of Skoljarev v Australian Fisheries Management Authority (1995) 133 ALR 690; Drake and Minister of Immigration and Ethnic Affairs (1979) 24 ALR 577 and Re Evans and Secretary, Department of Primary Industry (1985) 8 ALD 627 in support of his proposition that grants officers should not be restricted by phrases that are ill-defined such as "exceptional" or "special circumstances". However, I do not consider that those cases support such a proposition. They expressly approve the concept of policy statements and rules and standards in certain situations providing there is still provision to depart from those in special circumstances, or to borrow a phrase used in Skoljarev v Australian Fisheries Management Authority and Drake and Minister of Immigration and Ethnic Affairs, there are "cogent reasons to the contrary". [41] I have no doubt, therefore, that the situation in this case is in the second category referred to by Tipping J, and is of the type that was referred to first by Bankes LJ in R v Port London Authority. I do not consider that it is unlawful for an Agency to set out policies and guidelines relating to the grant of legal aid travel expenses, providing there is adequate provision for departure from the guidelines when the merits require it.The words of the guidelines in this case[42] There are two ways in which a merits-based approach governed by guidelines could be drafted. One way would be to have guidelines which require the application of the facts of the individual claim, but which impose a fixed response to those facts, and take away any discretion. An example would be a rule that all applications for travel expenses in a certain area would never be allowed. The policy would always prevail. This sort of approach unless dictated by the relevant legislation, would offend the requirement that there must be latitude to consider an individual set of facts, whatever result may be indicated by the guidelines. It would fall into the first category referred to by Tipping J, and the second by Bankes LJ. [43] These guidelines do not fall into that category. In setting out policy the guidelines state that the Agency will "generally not consider" circumstances that are not set out in the guidelines. The words are not absolute and there is provision for "exceptional circumstances". [44] The specific quoted provision for departure from the guidelines in exceptional circumstances makes it very clear that in the end grants officers are not bound absolutely by anything stated in the guidelines. The policy allows grants officers "to use their own discretion" when deciding whether travel will be paid if exceptional (or special) circumstances have been demonstrated. It is specifically stated that "These vary from case to case and each request must be considered on its own merits." What follows under the heading "Exceptional Circumstances" is a statement of matters to be taken into account and examples of exceptional circumstances. It is stated specifically that these are "some examples". Clearly there is no exhaustive exposition of what may constitute exceptional circumstances, and it is a matter for the officer's discretion. [45] The section on exceptional circumstances will presumably be read together with the earlier section on access to justice, which records the need to not deny a client effective legal representation.[46] Thus if exceptional or indeed special circumstances were defined with precision, taking away any prospect of discretion, that could well be an error as the guidelines would prevail absolutely. However, this is not the case in relation to these guidelines. They do not purport to fetter absolutely a grants officer's general discretion.Exceptional versus special circumstances[47] The Panel based its decision on a distinction between exceptional and special circumstances. However, in none of the cases relating to the guidelines of administrative bodies is there any particular focus on the distinction between exceptional or special circumstances. Bankes LJ in R v Port of London Authorityused the word "exceptional" in the passage cited in British Oxygen. In Practical Shooting Institute Tipping J used the phrase "sufficiently special". [48] Lord Bingham of Cornhill in R v Kelly [1999] 2 All ER 13 (CA) when construing a reference to "exceptional circumstances" stated at 20:We must construe 'exceptional' as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional, a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that is regularly or routinely or normally encountered.[49] In Creedy v Commissioner of Police at [32] this approach to the meaning of "exceptional" was regarded as in accordance with ordinary English usage. A statement in Wilkins & Field Ltd v Fortune (1998) 5 NZELC 95,793 (CA) treating "exceptional circumstances" as those which are "unusual, outside the common run, perhaps something more than special and less than extraordinary" was not followed. The approach in Creedy equated the meaning of "exceptional" with the meaning of "special". It is to be noted however that the issue in that case arose in the different context of s 114 of the Employment Relations Act 2000. [50] It cannot be asserted that confining unfettered discretion to "exceptional" as distinct from "special" circumstances is an unlawful fetter of a public body's discretion per se. Any decision on the exact meaning of "exceptional circumstances"will always turn on the particular context in which the word "exceptional" is used and the nature of the decision to be made. In this case the threshold of "exceptional" can be seen as connoting no more than an exception to a guideline or rule devised to deal with the ordinary run of cases. It is an adjective, derived from the noun "exception", a thing excepted from the normal rule. The word does not of itself create an unreasonably high threshold, as the word "extraordinary" might do. In the circumstances of travel expenses, I consider that a discretion limited to "exceptional circumstances" in these guidelines on travel even without the word "special" would be lawful, as it gives the officer the power to depart from the guidelines in the event of the particular merits demanding such a departure. Any particular factor or combination of factors could be sufficient. Indeed, that is expressly indicated at the beginning of the "Exceptional Circumstances" section. [51] I conclude, therefore, that the Panel was wrong to assume that the phrase "exceptional circumstances" created a higher threshold than "special circumstances" and was therefore unlawful. I do not express any view on the lawfulness or otherwise of other uses of the phrase "exceptional circumstances" in other Agency guidelines. Any decision will in the end turn on the words and context of the particular guideline. [52] I conclude, therefore, that the Panel was in error in two respects: first, in its assumption that "exceptional circumstances" was the only basis for the use of the discretion, when the guidelines also provided for special circumstances; and second, in its conclusion that the phrase "exceptional circumstances" fettered the Agency's discretion to such an extent that it was wrong in law.Manifest unreasonableness[53] In the penultimate sentence of its decision the Panel found that the decision to refuse to pay travel costs was also manifestly unreasonable. It did not set out a specific reasoning process in reaching this conclusion, but there is no doubt that it was based on the particular facts of that case, and the reasons for finding special circumstances set out in [27] of its decision.[54] I have no doubt that the Panel was entirely correct in concluding that the Agency's refusal to pay travel costs was manifestly unreasonable. I accept the submission of Ms Scholtens QC for the New Zealand Law Society that an integral part of accessing legal services is the ability meaningfully to communicate with and attend on or be attended on by a lawyer, which will often mean in person. There were exceptional circumstances. I do not need to set out reasons in detail given Mr Taylor's responsible concession on behalf of the Agency that the Agency was incorrect in its original decision. However, particular factors are: a) It was very urgent that an application be filed. b) It was not practical to expect Ms Sylva to visit her lawyer in Hamilton that weekend, or on the Monday morning. Her home was approximately five kilometres from the main road and she had three children to look after. To have reached the main road along which the bus travelled she would have had to have walked with her children, or found someone to look after her them. Given the alleged violence that she had experienced shortly before, it was not reasonable to expect that she should leave her children. Her husband had already allegedly punched one of the children who was six years old, and had been involved in a chase with another child who was 15. c) The course of action chosen by Ms Simes was sensible and efficient. She achieved in a single visit that which would normally require two visits, and did so with exemplary speed. d) Ms Sylva's access to justice would have been compromised if she had been denied prompt legal representation. [55] Further, as a matter of interpretation of the Grants Legal Aid Manual policy, the travel would not be regarded as falling within the category of local travel. Ms Sylva's home could not be construed on any pragmatic basis as being within the Hamilton metropolitan area, or within a town, or indeed between a close town and a metropolitan area. She was truly in an isolated country environment and in terms ofthe travel policy fell within the category of someone who had to travel to a distant court where travel distances were significant and where a provider closer to the court could not be assigned. The Agency indeed made an error of law in this regard. [56] I note of course that the decision must be showed to be "manifestly unreasonable" rather than simply "unreasonable". As noted by the Panel, it was stated in Legal Services Agency v A (2003) 17 PRNZ 443 at [11] by John Hansen J that "manifestly unreasonable" means "something different from what is wrong in law", and would be made out "where it is shown, clearly and unmistakably, that the decision made by the Agency went beyond what was reasonable, was irrational or logically flawed". Here the decision made by the Agency went far beyond what was reasonable. It was more than a decision on which there could be two views. Exceptional circumstances warranting travel by Ms Simes were obviously established. The refusal bore on Ms Sylva's ability to access justice, and did not reflect a proper application of the Agency's own guidelines. [57] Thus I agree with the decision of the Panel that the Agency's decision was manifestly unreasonable. Although I consider the Panel was in error in its conclusion that the Agency's policy was wrong in law because in its approach to "exceptional circumstances", it was correct in law to hold the Agency decision to be manifestly unreasonable. I uphold its decision on this second ground.Result[58] The appeal is dismissed.Costs[59] It is my preliminary view that costs should not be awarded against the Agency despite my having dismissed its appeal. The Agency has been largely successful in relation to the substantive issues. [60] Equally, however, I would not have considered it appropriate that any order be made in favour of the Agency given that it was the Agency's error which led tothe present situation, and that the Agency has for that reason been unsuccessful on this appeal. [61] However, I have not had submissions on the topic, and I will not make an order on costs now. I leave the question open for further submissions if that is the wish of the parties. Asher J