Finlayson's handling of Wilson case fine - PM

Attorney-General Chris Finlayson has handled a conflict of interest case against a Supreme Court judge properly, Prime Minister John Key says.

Mr Finlayson used to work with Justice Wilson who was recently investigated by Judicial Conduct Commissioner Sir David Gascoigne. Sir David considered three complaints about Justice Wilson's conduct in the long running Saxmere wool case. He recommended the Attorney-General set up a panel to investigate further and Mr Finlayson has passed that duty to another minister, Judith Collins.

Justice Wilson served as one of three Court of Appeal judges who, in 2007, overturned a High Court ruling which would have awarded wool growers group Saxmere repayment of $8 million in levies from the former Wool Board.

He had a personal and business relationship with the Wool Board's lawyer Alan Galbraith QC. They co-owned land in Waikato and bred horses together.

At the time of the Court of Appeal hearing Justice Wilson owed Mr Galbraith $242,804, something which was not disclosed to the court.

The Supreme Court last November ordered the Court of Appeal decision be set aside and the case re-heard in June this year on the grounds that Justice Wilson and Mr Galbraith's relationship could raise a perception of bias.

Mr Finlayson and Justice Wilson were both partners at the law firm Bell Gully in the 1990s and allegations have been raised that the minister would not act against him.

Mr Key was asked today if he was happy with Mr Finlayson waiting until last month before taking himself out of the mix.

"There was no conflict of interest earlier on, no need for him to excuse himself," Mr Key said.

"The process... in the first instance was that a commissioner, in this case David Gascoigne, had responsibility to determine whether there was a case to answer. That involved no action or consideration on the part of the Attorney-General so therefore there was no conflict.

"At the point at which David Gascoigne in his role then needed to refer that to the Attorney-General, potentially establishment of that panel, then clearly there was a potential conflict of interest. The Attorney-General himself recognised that and excused himself so he's in my view absolutely correctly followed process."

Mr Key declined to comment further on the case saying he did not want to contaminate the process.

In a statement last month Mr Finlayson said because he wanted the process to continue without "any possible perception of a conflict" he had transferred responsibilities that related to the Justice Wilson case to Ms Collins.

"I have no conflict of interest in this case," he said.

Ms Collins is considering the report including whether to approve setting up the judicial conduct panel.

Auckland University associate law professor Bill Hodge recently told NZPA a judicial conduct panel had not been appointed in New Zealand before. It would comprise two judges or retired judges and one lay person, appointed by the Attorney-General.