Stevens v ASB Bank Ltd - [2012] NZCA 611

IN THE COURT OF APPEAL OF NEW ZEALAND

CA806/2011
[2012] NZCA 611

BETWEEN GAVIN RAY STEVENS
Appellant

AND ASB BANK LIMITED
Respondent

Hearing: 17 September 2012

Court: Arnold, Randerson and Miller JJ

Counsel: P F Chambers for Appellant
Z G Kennedy and N A Chamberlain for Respondent

Judgment: 20 December 2012 at 11.30 am

JUDGMENT OF THE COURT

AThe appeal is dismissed.
BThe cross-appeal is allowed. Summary judgment is entered for the respondent on the appellant’s counterclaim.
C The appellant must pay the respondent costs for a standard appeal on a band A basis together with usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Arnold J)

Introduction

This is an unusual case. The respondent, ASB Bank Ltd (ASB), obtained summary judgment against the appellant, Mr Gavin Stevens, in respect of certain outstanding indebtedness. Mr Stevens raised a number of defences to ASB’s claim, which Associate Judge Doogue found could not succeed. Mr Stevens also raised the same matters by way of a counterclaim against ASB. The Associate Judge refused to grant ASB summary judgment on Mr Stevens’ counterclaim, however, holding that the test applicable to a defendant’s application for summary judgment was higher than that applicable to a plaintiff’s application for summary judgment.[1] This is one of the issues raised by the present appeal and cross-appeal.

Factual background

[1] ASB Bank Ltd v Stevens HC Auckland CIV-2011-404-1621, 11 November 2011.

The factual background is detailed and somewhat complex. Because we do not consider it necessary to do so, we will not traverse it in great detail.
Mr Stevens is a property developer. He and his brother, Mr Craig Stevens, trade through a partnership known as Cravin Holdings (Cravin). In addition, they were involved in a property development company, Frontier Properties Ltd (FPL). As at the end of 2007, Mr Stevens, Cravin and FPL had all borrowed funds from ASB. In particular:
(a)Messrs Gavin and Craig Stevens, as Cravin, had borrowed under a flexible finance facility against an “all obligations” first mortgage over a property at Fork Road, Kumeu (the Cravin facility).
(b)Mr Stevens and FPL had borrowed funds to purchase a property at Stanmore Bay, Auckland (the Stanmore Bay facility), secured by the existing Kumeu property mortgage and guarantees from Craig Stevens and a Mr Dye.
(c)Mr Stevens had a personal facility for $435,000 (personal facility).
On 1 April 2008, Mr Stevens’ personal facility and the Stanmore Bay facility expired. At that point, Mr Stevens and FPL were in default on the relevant loans. In July 2008, Mr Stevens approached ASB for further funding. Although ASB refused to advance further funds to Mr Stevens, it did provide re-financing under a facility agreement executed on 14 August 2008 (the 2008 facility). The borrowers were FPL and Mr Stevens, while his brother Craig and a Mr Dye were also parties, each having provided a guarantee and indemnity. The effect of the 2008 facility was that the ASB made available (a) a revolving credit up to $621,000, repayable on demand, and (b)…

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: [2012] NZCA 611
Decision Date: 20 December 2012

CaseChat Overview and Summary

In the New Zealand Court of Appeal, Stevens v ASB Bank Ltd is a case involving a property developer, Gavin Stevens, and ASB Bank Ltd. The dispute arises from a loan agreement and subsequent claims of misrepresentation and breaches of contract. Stevens appealed against the summary judgment granted to ASB, while ASB cross-appealed the decision not to grant summary judgment on Stevens' counterclaim. The Court of Appeal found that the Associate Judge's decision to grant summary judgment to ASB was correct, as Stevens' claims were not supported by the evidence and were inconsistent with the loan agreement's terms. The Court also found that the Associate Judge should have granted summary judgment in ASB's favour on Stevens' counterclaim, as the viability of the counterclaim could be determined based on the available evidence.

The appeal was dismissed, and the cross-appeal was allowed. Summary judgment was entered for ASB on Stevens' counterclaim. Stevens was ordered to pay ASB's costs for the standard appeal on a band A basis, along with usual disbursements.

Orders