King v ASB Bank Ltd - [2013] NZHC 2914

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-561 [2013] NZHC 2914

BETWEEN
BRUCE JAMES KING

Plaintiff

AND

ASB BANK LIMITED Defendant

Hearing: 25 July 2013

Appearances:

B J King in person
P V Shackleton and M A Powell for defendant

Judgment:

5 November 2013

JUDGMENT OF KATZ J

This judgment was delivered by me on 5 November 2013 at 4 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date: ...................................

Solicitors: Simpson Grierson, Auckland

Copy to: B J King, Auckland

KING v ASB BANK LIMITED [2013] NZHC 2914 [5 November 2013]

Introduction

[1] The ASB Bank Limited (“Bank”) lent money to the plaintiff, Mr Bruce King. The loans were secured over a property in Sandringham, Auckland (“Property”). The Property was sold by the Bank, pursuant to its rights as mortgagee. However, the proceeds of sale were not sufficient to discharge all of Mr King’s indebtedness to the Bank. The Bank now seeks to recover the shortfall.

[2] Mr King seeks to reopen the loan agreements or obtain other relief, primarily on the basis that the Bank has breached the Credit Contracts and Consumer Finance Act 2003 (“CCCFA”) and/or the Fair Trading Act 1986 (“FTA”).

[3] Mr King says that the Bank has exercised its powers or rights under the loan agreements in an oppressive way.1 “Oppressive” means oppressive, harsh, unjustly burdensome, unconscionable or in breach of reasonable standards of commercial practice.2 There must be some oppressive quality relating to the manner in which the right or power is being exercised, such as giving an oppressively short time to meet a demand for repayment, or making collateral unlawful threats.3 The Court is required to take into account all of the circumstances relating to the exercise of the right or power.4

[4] Mr King also claims that the Bank breached ss 9 and/or 13 of the FTA. Section 9 provides that no person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. Section 13 provides that no person, in trade, shall make a false or misleading representation concerning the existence, exclusion, or effect of any condition, warranty, guarantee, right or remedy.

[5] The Bank seeks summary judgment in respect of its counterclaim, as well as

defendant’s summary judgment in respect of Mr King’s own claims against the

Bank.

1 A breach of s 120(b) of the CCCFA
2 CCCFA, s 118. The terms used to define “oppression” are discussed in the decision of Vautier J in
Italia Holdings (Properties) Limited v Lonsdale Holdings (Auckland) Ltd [1984] 2 NZLR 1 (HC).
3 Shotter v Westpac Banking Corp [1988] 2 NZLR 316 (HC);
4 CCCFA, s 124(a).

[6] Mr King (who is self represented) did not file a separate defence to the counterclaim. Rather, he relied on his claim as also setting out the various matters on which he relied by way of defence to the Bank’s counterclaim. In particular, Mr King alleges that:

(a) The Bank sold the…

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 2914
Decision Date: 5 November 2013

CaseChat Overview and Summary

In the High Court of New Zealand, Bruce James King sued ASB Bank Limited for claims including oppressive exercise of rights under the Credit Contracts and Consumer Finance Act 2003 and breaches of the Fair Trading Act 1986. King argued the bank sold his mortgaged property in retribution for his complaints, made misleading representations to the Banking Ombudsman, dismissed his repayment offer oppressively, failed to hold accurate information about him, and negotiated in bad faith regarding a third party proposal. The bank sought summary judgment on its counterclaim and King's claims. The court found King's allegations not seriously arguable and granted the bank summary judgment on both the counterclaim and King's claims, awarding the bank costs.

The court considered the bank's enforcement actions, which included giving King time to sell the property himself and entering into repayment agreements. While King complained about the bank, the court found the bank's actions were commercial and not oppressive or retaliatory. The court also found the bank's refusal of King's repayment proposal was reasonable given his history of defaults. The bank had sufficient information to assess King's proposals. The court concluded the bank's conduct did not result in any loss to King or a third party. The bank was entitled to recover the shortfall from the property sale. The court granted the bank summary judgment and awarded costs.

Orders