Simons v ANZ Bank New Zealand Ltd

[2022] NZHC 2842

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-001190

[2022] NZHC 2842

UNDER

the Credit Contracts and Consumer Finance Act 2003 and High Court Rule 4.24

BETWEEN

ANTHONY PAUL SIMONS

First Plaintiff

ANDREW JOHN BEAVAN and MEI LIM
Second Plaintiffs

…/2 cont’d

Hearing:	(On the papers)
Judgment:	2 November 2022

JUDGMENT OF VENNING J

Application for leave

This judgment was delivered by me on 2 November 2022 at 11.30 am, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:           Russell Legal, Auckland

Bell Gully, Auckland Russell McVeagh, Auckland

Counsel:            D Salmon KC/A van Ammers, Auckland

S M Hunter KC, Auckland J Cooper KC, Auckland

SIMONS v ANZ BANK NZ LTD [2022] NZHC 2842 [2 November 2022]

AND

PHILIP CHARLES DUNBAR and SHERYN VALERI DUNBAR

Third Plaintiffs

BRUNO ROBERT BICKERDIKE and EMMA RENAE PUNTER

Fourth Plaintiffs

GLENN JONATHAN MARVIN and ANNA MARY CUTHBERT

Fifth Plaintiffs

ANZ BANK NEW ZEALAND LIMITED
First Defendant

ASB BANK LIMITED

Second Defendant

Introduction

[1]    In its judgment of 29 July 2022 the Court declined the second plaintiffs’ (ANZ plaintiffs’) application for leave to represent ANZ customers who had entered into loans before 6 June 2015 (existing loans).1 In short, the Court held that because the ANZ plaintiffs’ own claim related to a loan entered into after 6 June 2015 (post amendment loan) they could not represent customers with existing loans. To allow them to represent existing loan customers would deprive ANZ of limitation defences that applied to claims by customers with existing loans. The Court also noted that different provisions of the Credit Contracts and Consumer Finance Act 2003 (CCCFA) applied to existing loan customers. To that extent there was a lack of common issues between the ANZ plaintiffs and customers holding existing loans.

Application

[2]    The ANZ plaintiffs apply for leave to appeal that aspect of the decision. The application for leave is opposed by ANZ Bank New Zealand Limited (ANZ).

[3]    In a previous minute/orders of the Court, the Court granted leave to both the ANZ and ASB plaintiffs and the ANZ and ASB to appeal other aspects of the decision of 29 July 2022.2

ANZ plaintiffs’ case for leave

[4]The ANZ plaintiffs submit that:

(a)They have a strong arguable case the Court erred in declining their application. Assuming that existing loan customers’ claims are progressed after determination of the ANZ plaintiffs’ summary judgment application, ANZ would at that stage have the opportunity to raise limitation defences.

1      Simons v ANZ Bank Ltd & Anor [2022] NZHC 1836.

2      Minute/Orders of Venning J, dated 14 September 2022.

(b)The error is of significant general and public importance and should be determined by the Court of Appeal. This is the largest and one of the most complex representative actions brought in New Zealand and the first time opt-out representative orders have been made by the High Court since the Supreme Court confirmed their availability.

(c)The alleged error is also of real significance to the ANZ plaintiffs. Whether the ANZ plaintiffs can represent existing loan customers dramatically impacts the size of the ANZ class, affecting approximately 61,900 existing loan customers and will shape the future conduct of the proceeding.

(d)There will be no delay or prejudice if leave is granted as the plaintiffs and defendants have already been granted leave to appeal on other aspects of the judgment.

(e)Overall it is in the interests of justice that leave be granted.

ANZ’s response

[5]In opposition ANZ says:

(a)The issue the ANZ plaintiffs wish to raise on appeal does not meet the high threshold required for leave to appeal an interlocutory decision.

(b)The ANZ plaintiffs have not identified any arguable error of law or fact in order to meet that high threshold. The principles of law the Court relied on are well established.

(c)ANZ has a limitation defence that it is entitled to test in respect of the existing loan customers that it cannot test that against the ANZ plaintiffs (because they took out their loan post-June 2015).

(d)The decision not to grant the ANZ plaintiffs’ leave to represent the existing loan customers has no significance beyond this case. It is not a matter of general public importance.

(e)The ANZ plaintiffs’ application must be assessed on its own merits notwithstanding appeals from other aspects of the judgment will be heard by the Court of Appeal.

(f)The proper and most effective course for the conduct of the proceedings will be for the plaintiffs to apply to add a new representative plaintiff with an existing loan and for that new plaintiff to apply for representative orders.

(g)It is fundamental that a class action on behalf of 61,900 people whose claim gives rise to a common set of legal issues should be pursued by at least one person whose own claim reflects those same issues and allows them to be tested.

The approach to the leave application

[6]    The parties are agreed on the legal threshold for leave to appeal an interlocutory decision. The leave requirement is provided for in s 56(3) of the Senior Courts Act 2016. In Finewood Upholstery Ltd v Vaughan Fitzgerald J identified a number of relevant considerations which have subsequently been confirmed or approved by the Court of Appeal on a number of occasions.3 The relevant considerations to apply to an application for leave under s 56(3) are:

(a)a high threshold exists;

(b)the applicant must identify an arguable error of law or fact;

3      Finewood Upholstery Ltd v Vaughan [2017] NZHC 1679.

(c)the alleged error should be of general or public importance warranting determination or otherwise of sufficient importance to the applicant to outweigh the lack of general or precedential value;

(d)the circumstances must warrant further delay; and

(e)the ultimate question is whether the interests of justice are served by granting leave.

Analysis

Threshold

[7]    The requirement for leave applies to interlocutory applications (with the exception of strike out or summary judgment applications).4 The ANZ plaintiffs’ application was an interlocutory application in form, but the effect of the decision is to prevent a number of ANZ customers with existing loans from being represented in these proceedings as they are currently constituted before the Court. To that extent, I consider the appropriate threshold for leave in the present case to be less than for example, an application in relation to a discovery or privilege application. As noted, applications which otherwise have substantive effect such as summary judgment or strike out do not require leave.5 While I do not overlook ANZ’s submission that it would still be open to the proposed claimants to identify a representative and apply again I consider the nature of the application and the potential effect of the judgment support a lesser threshold for leave in this case.

Identifiable issue of law

[8]    ANZ argues that the interests of efficiency would be better served if the ANZ plaintiffs made an application to add one or more plaintiffs who could apply to represent customers with existing loans. The Court could then determine ANZ’s limitation defence. ANZ says that on the ANZ plaintiffs’ approach the issue would simply get “kicked down the line”. Further, as noted there is a difference in the

4      Senior Courts Act 2016, s 56(3) and (4).

5      Section 56(4).

versions of the CCCFA which apply. The defence and the differences are fundamental legal issues which cannot appropriately be dealt with by way of further classes or sub- groups.

[9]    Against that, the ANZ plaintiffs say the Court was wrong to find that to grant leave on the basis to do so would deny ANZ a limitation defence. The issue could be raised later.

[10]   Further, the ANZ plaintiffs say the existing loan customers have the same interests as the ANZ plaintiffs in a number of issues relating to the interpretation of ss 99, 90(3) and 95(2) of the CCCFA.

[11]   While I accept ANZ’s point that, as matters stand, the limitation point would be addressed sooner rather than later, this is a complex proceeding which inevitably will involve a number of stages and hearings before it is ultimately resolved, either by the Court (or the parties).

[12]   Next, while the ANZ plaintiffs face some different issues to the existing loan customers under the different sections of the CCFA that were applicable at the relevant time, I accept that it is not essential for there to be a commonality of interest in all issues.

[13]It follows I accept that the proposed appeal raises reasonably arguable points.

General or public importance

[14]   I do not consider the alleged error or issue for determination to have general or public importance, given the Court was, as the ANZ submits, applying settled principles of law. But I do accept the issue is of significant importance to the ANZ plaintiffs and more relevantly, to the potential other 61,900 ANZ customers with existing loans. That factor supports the grant of leave.

Delay

[15]   Delay is not a particularly relevant feature given that the Court has granted leave to the parties to this litigation to appeal other aspects of the decision to the Court of Appeal. If leave is granted the current application would be heard at the same time.

Interests of justice

[16]   Overall, having regard to the above, I consider the interests of justice support the grant of leave.

Result

[17]   The application for leave to appeal in relation to that aspect of the decision holding that the ANZ plaintiffs cannot represent ANZ customers who entered loans with ANZ before 6 June 2015 (existing loans) is granted. As an aside, I note the comments of William Young J in Horsfall v Potter regarding the breadth of leave once leave is granted to appeal where the issue is not confined to an issue of law.6 However, as counsel did not address on the point I do not need to consider the impact of that decision on this application given the leave already granted on the other applications.

Costs

[18]   The ANZ plaintiffs are entitled to costs on the application on a 3B basis together with disbursements as fixed by the Registrar.

Venning J

6      Horsfall v Potter [2017] NZSC 196 at [72]–[73], [2018] 1 NZLR 638