ASB Bank Ltd v Robertson - [2013] NZHC 2125

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-1858 [2013] NZHC 2125

UNDER the Insolvency Act 2006

IN THE MATTER OF

the bankruptcy of CANDACE ANN ROBERTSON

BETWEEN

ASB BANK LIMITED Judgment Creditor

AND

CANDACE ANN ROBERTSON Judgment Debtor

CIV-2013-404-1859

UNDER

the Insolvency Act 2007

IN THE MATTER OF

the bankruptcy of ROSS ARTHUR ROBERTSON

BETWEEN

ASB BANK LIMITED Judgment Creditor

AND

ROSS ARTHUR ROBERTSON Judgment Debtor

Hearing: 16 August 2013

Appearances:

N F D Moffatt and H K Macdonald for Judgment Creditor
R A and C A Robertson in person

Judgment:

16 August 2013

ORAL JUDGMENT OF ASSOCIATE JUDGE BELL

Solicitors:
Bell Gully (N F D Moffatt) Auckland, for Judgment Creditor

Copy for:
Mr and Mrs R A Robertson, Auckland.

ASB BANK LIMITED v ROBERTSON [2013] NZHC 2125 [16 August 2013]

[1] These two applications to set aside bankruptcy notices have been heard together. At the start of the hearing I discussed with the parties whether this hearing should be in court or in chambers. Both sides accepted that the case should be heard in court, and I ruled that the case was a court hearing. The Robertsons understood the consequences of the case being heard in court. That is, if there is any appeal from the decision, the appeal will go to the Court of Appeal, with the time for lodging an appeal to be 20 working days after the decision.

[2] The matter for decision is whether the bankruptcy notices that the ASB Bank has served on Mr and Mrs Robertson should be set aside. The Insolvency Act 2006 sets out grounds on which a bankruptcy notice can be set aside. The case law has also developed an additional ground based on preventing abuse of process. The Robertsons have applied to set aside the bankruptcy notices on the grounds that they have a counterclaim against the bank which they could not set up in the original proceeding in which judgment was given against them and which exceeds the judgment that was given against them. That is the matter I have to decide. I do not have to decide anything beyond that. I say that because, in his submissions, Mr Robertson raised other arguments that addressed questions as to whether it was right that he and his wife should be made bankrupt. This case does not require a decision whether Mr and Mrs Robertson should be adjudicated bankrupt. Any question of bankruptcy might be the subject of a later application for adjudication. The question how the court should exercise its discretion is only decided upon the hearing of a bankruptcy application. It is not decided on an application to set aside a bankruptcy notice.

[3] The bankruptcy notices against Mr and Mrs Robertson each require payment of $811,259.37. That is the balance owing on judgments that the bank obtained against Mr and Mrs Robertson on 5 July 2012. The amount for which judgment was entered was $1,962,819.31. The bank had sued the Robertsons under term…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] NZHC 2125
Decision Date: 16 August 2013

CaseChat Overview and Summary

This matter concerns two applications to set aside bankruptcy notices issued by ASB Bank against Mr and Mrs Robertson. The court was required to decide whether the bankruptcy notices should be set aside on the grounds that the Robertsons have a counterclaim against the bank, which they could not set up in the original proceeding in which judgment was given against them, and which exceeds the judgment that was given against them. The court found that the Robertsons did not have a triable case for breach of duty under s 176 of the Property Law Act or a claim for a sum that is greater than the judgment against them. The Robertsons had raised three matters which they say go to the bank’s non-compliance with its duty under s 176 of the Property Law Act. The court found that none of these matters could be taken cumulatively to add up to a breach of the duty under s 176. The court also found that even if the Robertsons could establish that they had a claim for breach of duty under s 176, they also need to establish that the claim would be for more than the amount claimed in the bankruptcy notice, which they did not do. The court dismissed the applications to set aside the bankruptcy notices and awarded the bank costs on a 2B basis.

Orders