O'Connor v Law Debt Collection Ltd - [2015] NZHC 2265

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-3315 [2015] NZHC 2265

UNDER the District Courts Act 1947

IN THE MATTER

of an appeal against the decision of the
District Court

BETWEEN

PATRICK MICHAEL O'CONNOR Appellant

AND

LAW DEBT COLLECTION LTD Respondent

Hearing: 25 June 2015 and 4 September 2015

Counsel:

D G Hayes for Appellant
N Tabb for Respondent

Judgment:

18 September 2015

JUDGMENT OF BREWER J

This judgment was delivered by me on 18 September at 3:00 pm pursuant to Rule 11.5 High Court Rules.

Registrar/Deputy Registrar

Solicitors: Hunwick Law Ltd (Hamilton) for Appellant
Natalie Tabb (Auckland) for Respondent

Counsel: David Hayes

O'CONNOR v LAW DEBT COLLECTION LTD [2015] NZHC 2265 [18 September 2015]

Introduction

[1] The appellant, Patrick O’Connor, appeals against a decision of Judge C S

Blackie delivered in the District Court at Manukau on 28 November 2014.

[2] The respondent, Law Debt Collection Ltd (LDC), is a debt collection company. In the course of its business it informed a company that provided a credit rating service that Mr O’Connor was a defaulting debtor. Mr O’Connor, as plaintiff in the District Court, claimed that the LDC was wrong to conclude that he was a defaulting debtor. Mr O’Connor claimed that the defaulting debtor was actually a Trust with which he was involved. He pleaded that LDC’s advice to the credit rating service was misleading or deceptive conduct in trade, contrary to s 9 of the Fair Trading Act 1986 (“the FTA”). He also pleaded a claim in negligence alleging that LDC owed him a general duty of care to ensure he was correctly named as a debtor. He sought a mandatory injunction to compel the respondent to withdraw his details from the credit rating service, and $5,000 in general damages.

[3] Judge Blackie held that Mr O’Connor is the defaulting debtor, and accordingly LDC made no error in informing the credit rating service that he was a defaulting debtor. The gravamen of the appeal is that this conclusion was not available to the Judge on the evidence before him. Mr O’Connor’s notice of appeal, and submissions, are on this point.

[4] LDC submits that the Judge did not err. But it also raises another point in opposition: that Mr O’Connor was time-barred in his claim. This point was raised before the District Court Judge but is not mentioned in his Honour’s judgment.

[5] During the relevant period, the applicable legislation was s 43 of the FTA.1

Section 43(5) reads:

An application under subsection (1) may be made at any time within 3 years after the date on which the loss or damage, or the likelihood of loss or damage, was discovered or ought reasonably to have been discovered.

1 The respondent cites s 43A, but that was enacted by the Fair Trading Amendment Act 2013. In any event, the sections are very similar.

[6] It is clear that Mr O’Connor knew in early 2009 that he was listed as a defaulting debtor. Mr O’Connor was…

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: [2015] NZHC 2265
Decision Date: 18 September 2015

CaseChat Overview and Summary

The High Court of New Zealand was asked to determine an appeal brought by Patrick O’Connor against a decision of the District Court. The District Court had ruled that Law Debt Collection Ltd (LDC) was correct in listing O’Connor as a defaulting debtor in a credit rating service. O’Connor argued that he was not the debtor, but rather a trust with which he was associated. He sought a mandatory injunction to remove his details from the credit rating service and damages for misleading or deceptive conduct under the Fair Trading Act 1986, as well as a claim in negligence. The central issue on appeal was whether the District Court Judge correctly concluded that O’Connor was the defaulting debtor.

The High Court, presided over by Brewer J, considered three main issues: whether the District Court Judge erred in finding that O’Connor was the defaulting debtor, whether LDC could rely on a limitation bar in the Fair Trading Act, and whether the nature of the remedy sought by O’Connor had any bearing on the appeal. The court held that O’Connor had led CoveKinloch, the consultancy firm, to reasonably believe that he agreed to be bound by an obligation to pay for the services rendered. The objective approach to contract formation and O’Connor’s conduct during settlement discussions supported the District Court’s finding. The court also noted that if O’Connor was the defaulting debtor, the appeal would be dismissed, and other issues would not need to be addressed.

Brewer J concluded that O’Connor was indeed the defaulting debtor and dismissed the appeal. The court awarded costs against O’Connor on a 2B basis, meaning that O’Connor would pay the costs of the losing party unless the Court decided otherwise.

Orders