Analysis: Colloquially, we speak of the wisdom of Solomon to describe a gentle application of justice.

But the wisdom of Solomon applied by High Court Justice Mary Peters, in a judgment made public today, is more reminiscent of the time the Old Testament king ordered a sword be brought to him, and proposed to cut a baby in two in order to settle a dispute between two women who both claimed the child.

Justice Peters hasn’t offered to cut the Auckland Showgrounds in half, severing the western part of Sir John Logan Campbell’s endowment from the eastern portion designated for the primary use of public events.

She has, however, warned that use of the historic eight hectare Showgrounds could be denied to both the film industry and the events industry, if they can’t quickly settle their differences.

This dispute highlights the struggles of two industries once regarded (like the two women in the Old Testament tale) as housemates, but now adversaries. The pandemic has put enormous stress on both

Again and again, the events company owned by High Court plaintiff Brent Spillane has cancelled shows over the past two years, culminating by calling time on last month’s Food Show. The Home Show, the Baby Show and other events have also been repeatedly postponed and cancelled at the last minute, denying hundreds of innovative Kiwi companies their biggest chance to grow their businesses.

“While these buildings remain vacant,” says Spillane, “this substantial revenue for the venue will evaporate along with the recreational enjoyment of many tens of thousands of business and consumer visitors and fans missing out on shows such as the Auckland Food Show this year.”

But the film and TV sector is also hurting, most visibly with the premature departure of Amazon Studios, having shot only one of six series of its $1 billion Lord of the Rings TV show. (You read that first on Newsroom). Film Commission boss David Strong has stood down over a conflict of interest over funding for his own project – and it comes as the Govt reviews the Screen Production Grant and the Screen Industry Workers Bill.

Landlord Cornwall Park Trust Board had made a secret agreement (also revealed by Newsroom) to end more than 100 years of public events like the Royal Easter Show and instead lease the showgrounds to film company Xytech.

Auckland-based Xytech, in turn, had agreed to convert the Showgrounds’ enormous buildings to soundproofed studios for a “substantial” American film company, in the words of the judge. The identity of that company can’t be disclosed, by court order, but suffice to say a company of that scale would provide an enormous injection into the economy over the four-to-six-year term of the lease.

At the time the trust board entered the agreement with the Xytech, the mixed film and event use of the Showgrounds was the strongest offer, according to Murray Reade, the Cornwall Park chief executive.

Since the liquidation of the Shows Board, which was the previous operator, the trust board has assumed responsibility for the costs of maintaining and renewing the buildings on the site. For other events centres, he observes, such costs are often subsidised by local councils or regional economic development agencies.

“Significant expenditure is required to maintain and renew these buildings and their services to a fit and proper standard and to discharge health and safety standards,” Reade says. “This work had been deferred by the Shows Board, but is now underway in line with a schedule of works that will unfold over the next five to seven years.”

He says Spillane’s court injunction has further delayed final decisions on the usage of the site.

He left the door open to appealing the decision against the Xytech lease. “The Trust Board is still considering its options and in advance of the High Court’s final ruling on this matter will not be making further comment.”

Screen production is an industry that has relied heavily on government subsidies and tax breaks; The Hobbit got $161m in taxpayer support; Amazon’s Lord of the Rings was in line for at least $162m; the Avatar sequels have received $140m to date. The events industry, rather than asking the Government to get involved, has more often asked it to get out of the way by cutting red tape and compliance costs. Both are forms of support!

Now both sectors need help.

And in robust Old Testament terms, Justice Peters has offered them that. She has ruled the Xytech lease unlawful, under the Cornwall Park Endowment and Recreation Land Act 1982 which requires that the land continue to be used for exhibitions, trade fairs and public events.

But instead of ordering Cornwall Park Trust Board to again make the Showgrounds available for shows and events, she’s told the parties to resume talks – including the potential for the film and events industries to properly share the site – and report back to her in coming days.

If not, she notes Sir John Logan Campbell’s 1901 Deed allows the bulk of the Showgrounds to be closed off – at least temporarily – and not leased to anyone.

“Further orders as to relief may follow,” she says, weighing her sword …

Newsroom Pro managing editor Jonathan Milne covers business, politics and the economy.

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