There was no need for the Order in Council removing Mighty River Power from the State Owned Enterprises Act to go ahead today, Prime Minister John Key said.
The Government had announced its intention to make the order today, but has postponed it on court advice.
"It really doesn't make any difference at this point anyway because we don't need it ‘til March or April of next year," Key said.
That allowed time to go to court and test the Crown's position.
"Once we made the decision last week to indicate that we'd be moving on the Order in Council, that was the trigger always for applicants to take the case to the courts, we knew that would be the case so it's done it's job and now we'll go through the next process."
There had been no victory today for the Maori Council, Key said.
The judge had agreed to hear the case, but the real victory was when you won the case.
"We believe we're right," he said.
Key expected the case to go all the way to the Supreme Court, but said he was confident the part-float of Mighty River Power remained on track for March.
"The courts have a history of understanding the timetable of the government and recognising that there's some urgency around these issues in dealing with that."
Mana Party leader Hone Harawira said any delay in the sale of state owned assets was a win for the Maori Council and all New Zealanders.
"I don't think the court action is going to get out of the way in time for them to meet their March deadline which means they'll have to put it off to October."
The High Court had sided with the Waitangi Tribunal in the past and was likely to do so again, he said.
The decision came this afternoon after the High Court set a date of November 26 for a hearing of challenges by the Maori Council and Waikato River iwi aimed at blocking the sale of up to 49 per cent of the power company.
The Crown's lawyer David Goddard QC had this morning asked for a date to be set for the hearing, so Cabinet could decide whether to go ahead with an Order in Council changing Mighty River Power's status.
He said Cabinet could also opt to delay the date the Order took effect.
But after Cabinet was told of the date it had decided "not to proceed with an Order in Council" Goddard said.
However, he said the Crown's expectation was that the hearing in November would "not try and solve all questions related to the ownership of water in New Zealand".
Prime Minister John Key, said people should “brace themselves” for a protracted legal battle over the sale of state owned assets.He said the battle looked likely to be headed for the Supreme Court.
“What I would say is that I think people have to brace themselves for the likelihood that there will be a protracted process in so much that it will not just go to the High Court, I imagine it will likely go to the Court of Appeal and potentially the Supreme Court.”
He was hopeful, however, that the courts would “have a mind” to the government’s programme, “which is we want to bring Mighty River Power to the market as early as March of next year’’.
‘‘Hopefully they will put a bit of urgency into the hearing of the applications to the courts.”
Lawyers for the Maori Council are challenging the government’s decision to proceed with the sale of SOE shares after the Waitangi Tribunal said it would be in breach of the treaty.
The Order In Council had been due to be signed this afternoon by Governor-General Sir Jerry Mateparae.
Key said the Order in Council was not required till March next year so there was no issue with it being delayed today. But lawyers would be talking to the High Court about the potential to fast track the process.
“One option would be to go straight to the Supreme Court.
‘‘Probably the more likely option to speed things up is straight to the Court of Appeal and then the Supreme Court.”
Key made it clear, meanwhile, he would consider it unacceptable if the Maori Council got taxpayer funded legal aid for their case.
“It's a matter for them now to go and take the application if they want to. [That] would be my view, but I don't get to decide… but the long and short of it, there is criteria you have to meet and I'm not sure they meet the criteria.”
Labour leader David Shearer said anything which stopped the sale of state-owned assets was a "good thing".
"When you take into consideration the court costs, the consultancy costs, the consultation costs, the amount of money that is going to have to be put aside for possible settlements in the future.
‘‘If you talk to any analyst about what these SOEs are going to be sold for, all of them will tell you they are going to be sold for less than what they were going to be sold for just a few months ago."
The Maori Council had the right to seek legal aid to pay for its case, he said.
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