Social capital is a property of the relations between people; it denotes resources available to people based on the trust within those relationships. Robert Putnam connected social capital to democratic performance claiming it was an agent for democracy. He equated the term with civic-ness and in so doing attributed social capital with properties that it did not have when applied when to larger, abstract, conglomerates of people such as communities and nation-states. For social capital to be relevant to democracy, it requires social trust - a trust diffused throughout society and available to all of its members. In this thesis, it is argued that social capital is not necessarily democratising as Putnam claims because trust is not automatically transitive; trust cannot be applied to one relationship because it exists in another relationship. Trust at the community level, therefore, relies on a mediating structure to facilitate social trust. Based on a case study of a dispute involving an institution created as just such a mediating structure (a Community Board in Christchurch), it is argued that political institutions can act as a mediating structure to facilitate social trust and so facilitate social capital. This, however, is possible only if the political institutions themselves are trustworthy. Trust is inhibited by political institutions and their agents when promises are broken, procedures are unfair, when trust placed in the institution is not reciprocated, or when residents are treated with disrespect. If a political institution or its agents are considered untrustworthy they are not able to facilitate social capital. The ability of a political institution to facilitate social capital also depends on the authority and resources of the institution, and the abilities, competence and ethics of the staff responsible for facilitating social capital.