BANK OF NEW ZEALAND v HE [2022] NZHC 2128

BANK OF NEW ZEALAND v HE [2022] NZHC 2128 [25 August 2022]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2020-404-2508[2022] NZHC 2128BETWEEN BANK OF NEW ZEALANDPlaintiffAND WENYUE HEDefendantHearing: 29 July 2022Appearances: S Armstrong for PlaintiffG J Thwaite for DefendantJudgment: 25 August 2022Reissued: 30 August 2022JUDGMENT OF ASSOCIATE JUDGE JOHNSTONThis judgment was delivered by me on 25 August 2022 at 4.00 pm,pursuant to r 11.5 of the High Court RulesRegistrar/Deputy RegistrarIntroduction[1] This is a debt recovery claim by the plaintiff, Bank of New Zealand, against acustomer, Wenyue He. After the commencement of the substantive proceeding, BNZapplied for summary judgment, with the result that it requires leave. Both BNZ'sapplication for leave and its application for summary judgment are opposed by Mr He.[2] BNZ is a trading bank. Mr He is a Chinese citizen with New Zealandresidency.[3] Between March 2014 and October 2016, BNZ and Mr He entered into fourloan transactions, the total value of which was $3,210,000. Ms Armstrong's writtensubmissions included a tabular description of the loans. The accuracy of this was notchallenged, and it is replicated below:1Loan Date the LoanAgreement wassigned by Mr HeAmount Comments2014 loan0000000000-00002(also known as Loan 1)10 March 2014 $1,280,000 15/9/2015 – Partial repayment of$655,298.50.4/9/2019 – Balance of 2014 loanrepaid on mortgagee salesettlement date. The Bankstatements record that as at thisdate, the interest rate for this loanwas 5.9% p.a.July 2014 loan0000000000-0000331 July 2014 $130,000 15/9/2015 – Repaid in full$127,787.69.2015 loan0092239590-00004(also known as Loan 2)22 January 2015 $900,000 4/9/2019 – Repaid in full on themortgagee sale settlement date.The Bank statements record thatas at this date, the interest rate forthis loan was 5.3% p.a.2016 loan0000000000-00005(also known as Loan 3)7 October 2016 $900,000 4/9/2019 – Partial repayment onthe mortgagee sale settlementdate. The Bank statements recordthat as this date, the interest ratefor this loan was 4.66% p.a.[4] At the time of the establishment of the first of these loans, BNZ had or tooksecurity in the form of a first registered mortgage over a property owned by Mr He at8 Ngapipi Road, Ōrākei, Auckland.1 (Footnotes omitted).[5] In November 2016, ownership of 8 Ngapipi Road was transferred from Mr Heto the trustees of the Queen's Trust, a trust he appears to have settled. The trusteeswere Mr He and a company by the name of Bella Trustee 130708 Ltd.[6] A little over a year later in January 2018, the Register of Companies struckBella from the register and, as a result, Mr He once again became the sole owner ofthe property, this time as a trustee.[7] By February 2018 the loans had fallen into arrears and BNZ commencedenforcement steps. The loans were brought into line briefly, but, by November 2018,they were again in arrears. In February 2019, BNZ commenced recovery action. Itdid so through Verofi Ltd, a company BNZ contracts to provide what it refers to asdefault management services.[8] The amount recoverable, and BNZ's prima facie entitlement to recover thisamount are not in issue.[9] BNZ, through Verofi, took the orthodox steps for recovery of a secured debt:(a) on 5 March 2019, BNZ served a notice of demand;(b) on 11 December 2020, BNZ commenced this proceeding against Mr Hefor recovery of the residual debt plus interest and costs;(c) on 1 November 2021, Mr He entered a defence and counterclaim; and(d) on 25 March 2022, BNZ filed and served applications for:(i) leave to apply for summary judgment;(ii) summary judgment for an order striking out the defendant'scounterclaims; and(iii) summary judgment on its own claims.[10] As already indicated, BNZ requires leave to apply for summary judgmentbecause it did not make that application at the time the statement of claim was servedon Mr He.2 Its application for leave is opposed. However, the grounds on whichMr He opposes leave are the same as the grounds on which he contends that BNZ'sapplication must fail, so that BNZ's application for leave must stand or fall with itsapplication for summary judgment. So too must BNZ's application for an orderstriking out Mr He's counterclaims — BNZ will only be entitled to summary judgmenton its claims if Mr He's counterclaims cannot succeed.Summary judgment principles[11] In the course of her submissions, Ms Armstrong set out the principles relatingto summary judgment in the following way:3[20] Rule 12.2 gives the Court jurisdiction to give judgment when there isno defence or when no cause of action can succeed. The principles are wellsettled. The Court of Appeal in Krukziener v Hanover Finance Limited setthem out as follows:a) The question on a summary judgment application is whetherthe Defendant has no defence to the claims; that is, that thereis no real question to be tried; Pemberton v Chappell [1987]1 NZLR 1; (1986) 1 PRNZ 183 (CA) at p 3; p 185. The Courtmust be left without any real doubt or uncertainty.b) The onus is on the Plaintiff, but where its evidence issufficient to show there is no defence, the Defendant will haveto respond if the application is to be defeated. MacLean vStewart (1997) 11PRNZ 66 (CA).c) The Court will not normally resolve material conflicts ofevidence or asses the credibility of deponents. But it need notaccept uncritically evidence that is inherently lacking incredibility, as for example where the evidence is inconsistentwith undisputed contemporary documents or other statementsby the same deponent, or is inherently improbable: inEng Mee Yong v Letchumanan [1980] AC 331; [1979] 3 WLR373 (PC), at p 341; p 381.d) In the end, the Court's assessment of the evidence is a matterof judgment. The Court may take a robust and realisticapproach where the facts warrant it: Bilbie Dymock Corp vPatel (1987) 1 PRNZ 84 (CA).2 High Court Rules 2016, r 12.4(2).3 (Footnotes omitted)[12] Mr Thwaite did not disagree with that analysis, and I could not improve on it.Grounds of Opposition[13] Mr He opposes summary judgment on the basis of his pleaded counterclaims.As I read the statement of defence and counterclaim, there are effectively threecounterclaims:4(a) Mr He contends that he is a consumer for the purposes of pt 1A of theCredit Contracts and Consumer Finance Act 2003 (CCCFA) and thatBNZ acted in breach of its obligations under pt 1A;(b) He alleges that BNZ failed properly to serve its notice pursuant to s 119of the Property Law Act 2007 at the outset of the mortgagee saleprocess; and(c) He alleges that, in the course of the mortgagee sale process, BNZ failedto discharge its obligation in terms of s 176 of the Property Law Act totake reasonable care to secure the best available price for the property,thus causing him loss.[14] On those bases, Mr He says that he is entitled to claim an amount whichexceeds the amount of the residual debt that BNZ is seeking to recover from him inthis proceeding.[15] I pause to mention that the development of Mr He's opposition to BNZ'sapplication for summary judgment was obviously an iterative process, as the pleadedcounterclaims were expanded upon first in the notice of opposition and again byMr Thwaite in the course of his submissions. This is unhelpful. Neither the Court norother parties should be placed in the position of having to deal with a proposition, thesubstance of which was not squarely raised in the pleadings.5 They are an "essential4 There are five pleaded causes of action, but the first, second and third are all effectively involvethe same contention, that is to say failure to comply with the statutory requirements when servingthe Property Law Act notice in the course of the mortgagee sale.5 Price Waterhouse v Fortex Group Ltd CA179/98, 30 November 1998, at 18.road map" for the Court and the parties.6 An essential part of pleadings is to state thebasic facts on which the claimant or counterclaimant rely so as clearly to define theissues which the defendant has to meet.7[16] It would have been open to BNZ to invite the Court to disregard anyinadequately pleaded contentions.8 However, Ms Armstrong elected to meet themhead on and respond. In this regard, I follow her lead.Credit Contracts and Consumer Finance Act 2003[17] The pleaded counterclaim is that BNZ failed to comply with its obligationsunder pt 1A of the CCCFA because it lent more to Mr He than the value of the security.I note that in Mr Thwaite's submissions, he acknowledged that this argument can onlysupport a claim in relation to loans made after 6 June 2015 when pt 1A of the CCCFAcame into effect.[18] Section 9C of the CCCFA imposes obligations on all lenders. Section 9Bdefines the term "lender", for present purposes, as "a creditor under a consumer creditcontract". A consumer credit contract requires the credit acquired by the debtor to beused for personal, domestic, or household expenses.9 Section 12 of the CCCFAprovides that "[i]nvestment by the debtor is not a personal, domestic, or householdexpense". Thus, the first hurdle Mr He must clear is establishing that he sought the2016 loan for personal, as opposed to investment, purposes.[19] The loan application itself describes the purpose of the loan sought as"Purchase Residential Property (Existing Dwelling)", though the evidence indicatesthat that form is used by BNZ for any loan that is to be secured by a mortgage over adwelling. That description contrasts with that which appeared on Mr He's earlier loanapplications, namely: "Purchase – Investment". Also, the second schedule to the saleand purchase agreement (SPA) for the Waikato property suggests that at least part ofthe property was, at the date of the agreement, being used for residential purposes.6 At 17.7 Hopper Group Ltd v Parker (1987) 1 PRNZ 363 (CA) at 366.8 High Court Rule 2016, r 1.5.9 Credit Contracts and Consumer Finance Act 2003, s 11.[20] As against the above evidence, there is more direct evidence to the effect thatthe loan was for investments purposes. Schedule 2 of the SPA contains anacknowledgment by Mr He that he intended to use the property for making taxablesupplies. BNZ's responsible officer who dealt with Mr He at the outset, Ms Yi Yin,has sworn an affidavit. Her evidence is that Mr He informed her that he was seekingthe 2016 loan for the purpose of buying an investment property in the Waikato. Thereis also a BNZ diary note entry in MyLending from October 2016 that records Mr Hehaving advised BNZ of his intention to invest in a Waikato property.[21] On balance I am satisfied beyond any real doubt that Mr He was not using theloan "wholly or predominantly for personal, domestic, or household purposes" and,therefore, that the 2016 loan agreement was not a consumer credit contract for thepurposes of the CCCFA.[22] Even if Mr He were able to clear this hurdle, the counterclaim would fail at thenext stage of the analysis.[23] Mr He contends that the breach of CCCFA occurred by virtue of BNZ grantinghim a loan that exceeded the value of his security. The evidence establishes that themaximum borrowing under these loan transactions at any one time never exceeded$2,500,000, due to repayments Mr He made in 2015. Mr He's own evidence is thatthe market value of the property on 15 September 2016 was $3,100,000. Ms Yin'sevidence is that, in processing Mr He's application for the 2016 loan, BNZ calculatedthat his loan to value ratio would be 76.66 per cent. Even if the Court were to acceptthe value of the property as Mr He asserts it in his statement of defence andcounterclaim ($2,600,000 in October 2016), the amount BNZ loaned him was stillcovered by the value of his security. Accordingly, even if pt 1A of the CCCFA applied,it would not have the effect for which Mr He contends.[24] That is enough to deal with the pleaded claim based on the CCCFA.[25] There remain, however, the unpleaded contentions.[26] Under pt 5 of the CCCFA, the Court has jurisdiction to reopen contractualarrangements where there is evidence an arrangement or conduct that is"oppressive, harsh, unjustly burdensome, unconscionable, or in breach ofreasonable standards of commercial practice".10 The Supreme Court inGE Custodians v Bartle noted that contracts may be reopened as oppressive even incases where a court of equity might not set aside the bargain as beingunconscionable.11 A contract or conduct may be oppressive even where the partyaccused of wrongdoing may be subjectively blameless because that party was simplyfollowing industry practice.12 It is the courts' obligation to set the standard, not theindustry.13[27] In his notice of opposition, Mr He says that BNZ's conduct was oppressive interms of pt 5 of the Act, thus entitling the Court to grant him relief by reopening thecontract or otherwise. This assertion is particularised in the following terms:(i) the loan contract is oppressive, because when it advanced the funds,Applicant's own records gave cause to doubt Respondent's ability tofund the relevant loan(s); or(ii) Applicant has exercised a right of power conferred by the loancontract in an oppressive matter, in:• advancing the funds, when Applicant's own records gavecause to doubt Respondent's ability to fund the relevantloan(s); and/or• enforcing its rights as mortgagee, when it did not improve thereasonably foreseeable sale price because it did not obtainaccess to the interior of the property, by means of takingpossession or otherwise.[28] There appear to me to be serious difficulties with this contention.[29] For a start, in contrast to the way in which the point is put in Mr He's notice ofopposition, when the argument was developed on Mr He's behalf by Mr Thwaite, itwas put in these terms:10 Section 118.11 GE Custodians v Bartle [2010] NZSC 146, [2011] 2 NZLR 31 at [46].12 At [46].13 At [46].Under the Consumer Finance and Credit Contracts Act 2003 Plaintiff shouldnot have advanced the funds to Defendant, as he was a consumer in terms ofs 11, 12 and 13 of the Act, and subsequent events have shown that he did nothave the ability to fund the loan to buy the property in Orakei. Hence he isentitled to relief under Part 5 of the Act, of a nature to be determined at trial.[30] The implication in the notice of opposition is that BNZ's records illustrated toit at the time of the original loan that Mr He did not have the necessary financialwherewithal to service the loan, whereas Mr Thwaite's argument proceeded on thebasis that that only became evident after the default. The Court was not referred toany evidence indicating that BNZ knew or ought to have known that Mr He's financialposition was inadequate to support the loans. On the contrary, the evidence indicatesthat Mr He was perfectly capable of funding these loans when they were granted.BNZ's evidence is that the value of Mr He's security was at all times more than thevalue of the lending. BNZ reviewed Mr He's annual income of $538,329 and Chinesebank account balance, and concluded that he appeared to be financially stable.[31] In the end, in my assessment, the evidence falls well short of supporting afinding of oppressiveness in relation to either the loan contract or BNZ's conduct forthe purposes of pt 5 of the CCCFA.[32] The second point identified in the notice of opposition relates to the mortgageesale process and can be dealt with when that aspect of the case is addressed.Property Law ActEffective Service[33] As already indicated, Mr He's pleaded counterclaims relating to the mortgageesale process are repetitive. His first, second and third counterclaims all allege thatBNZ did not effect service of the demand in the way required by the Property Law Acton Mr He before proceeding with the mortgagee sale. This core allegation is pleadedas a breach of contract (first counterclaim), a tort (second counterclaim) and a breachof statutory duty (third counterclaim). They all come down to the same thing, namelythat BNZ did not comply with its statutory obligations as to service.[34] There is no suggestion that BNZ's s 119 notice was in any way defective. Bothcounsel focused exclusively on the question whether BNZ had served its s 119 noticein accordance with pt 7 of the Property Law Act.[35] For BNZ to effect service of the s 119 notice on Mr He, it needed to complywith the following requrements prescribed by the Property Law Act:(a) Section 353 requires the s 119 notice to be served on "an individualperson in a manner provided for in section 359".(b) Section 355(2) of the Property Law Act provides that, in cases where aperson is out of New Zealand, a s 119 notice "may be given to, or servedon, an agent in New Zealand of the person". The evidence is clear thatwhen BNZ came to serve its s 119 notice on 3 July 2018, Mr He wasnot resident in New Zealand and so BNZ was entitled to serve the noticeon an agent.(c) Section 358 defines agent in orthodox terms as a person who "has actualor ostensible authority to receive, on behalf of that person a notice,cross notice or other document required or authorised to be given orserved by a provision of this Act". At the time that the parties enteredinto the first transaction in March 2014, Mr He was not living in thiscountry. In those circumstances, BNZ required that Mr He nominatean agent for service. This was done pursuant to cl 9.2.4 of that loanagreement. Thus the evidence establishes Mr Yuan had ostensible, andin all probability had actual, authority to receive the s 119 notice.(d) Section 359 provides that the document is given to, or served on, anindividual person when it is "received by that person in accordance withsection 360". Section 360 deems a document to be received when it ishanded to, and accepted by, that person. The evidence here is thatMr Yuan accepted service of the documents personally.[36] Mr Thwaite submitted that s 359 does not allow for personal service upon aperson's agent. However, s 359 applies to service on "an individual person (includingan individual person referred to in section 355)". By virtue of this cross-reference, theProperty Law Act allows for personal service upon an agent. I can see no flaw in theprocess followed by BNZ and consider the s 119 notice was effectively served onMr Yuan as Mr He's nominated agent.[37] In addition to the pleaded contention that service on Mr Yuan was not effectiveservice, Mr Thwaite argued two other points.[38] The first was that, because there were changes in ownership of the propertyover which BNZ held the security (from, it will be recalled, Mr He in his personalcapacity to Mr He and Bella as trustees of the Queens Trust and later to Mr He as thesole trustee), the notice ought to have been served on both Mr He and Bella.[39] I reject that submission. As already said, by the time BNZ came to serve itss 119 notice, Mr He was the sole trustee of the Queen's Trust. In those circumstances,BNZ's obligation was to serve Mr He in his capacity as the trustee. I see no reasonwhy the relationship of principal and agent as between Mr He and Mr Yuan wouldhave been revoked or altered in any way by the change of ownership. It is true that atthe time the agency arrangement was first established, Mr He was identifying Mr Yuanas his agent to receive documentation in his personal capacity. But it seems to me thatin appointing Mr Yuan as his agent without qualification, Mr He was representing toBNZ that Mr Yuan was authorised to accept service of documentation for him in anycapacity.[40] The second unpleaded point advanced by Mr Thwaite concerned whether BNZactually delivered the s 119 notice to Mr Yuan. These questions were only signalledto BNZ in Mr Thwaite's submissions. In response, BNZ filed affidavit evidenceconfirming service on Mr Yuan. Ironically, Mr He objected to the Court taking in thatlate evidence.[41] Given Mr He's introduction of new arguments by way of submission that werenot signalled at any earlier stage in the proceeding, I reject the contention that theCourt should not receive BNZ's evidence. I accept the evidence of the deponents inquestion.[42] I am satisfied that BNZ effected proper service of its s 119 notice.Sale at undervalue[43] In his fourth pleaded counterclaim, Mr He alleges that BNZ breached the dutyit owed to him pursuant to s 176 of the Property Law Act, which provides:(1) A mortgagee who exercises a power to sell mortgaged property,including exercise of the power through the Registrar under s 187, orthrough a court under s 200, owes a duty of reasonable care to thefollowing persons to obtain the best price reasonably obtainable at thetime of sale:(i) The current mortgagor:[44] The leading case in relation to s 176 is Apple Fields Ltd v Damesh HoldingsLtd.14 That judgment was upheld on appeal to the Privy Council.15 The Court ofAppeal, there, said that the purpose of the predecessor to s 176 was to protect those towhom a mortgagee owed a duty of care in the absence of any other incentive for amortgagee selling the property to obtain the full economic value in that sale over andabove the sum which will clear the mortgage.16 In short, the Court of Appeal acceptedthe provision was directed at ensuring that the best price reasonably obtainable wasachieved, but that did not alter the mortgagee's entitlement to give preference to itsown interests in deciding whether or not to sell.17 The Court said that what constitutesreasonable care will turn on the facts of the case.18[45] The Court of Appeal in Long v ANZ National Bank Limited discussed therelevant principles in assessing whether a mortgagee has breached its statutoryobligations under s 176 and its predecessor:1914 Apple Fields Limited v Damesh Holdings Limited [2001] 2 NZLR 586 (CA).15 Apple Fields Ltd v Damesh Holdings Ltd [2003] UKPC 54, [2004] 1 NZLR 721.16 Apple Fields Limited v Damesh Holdings Limited, above n 14, at [1].17 At [49].18 At [50].19 Long v ANZ National Bank Limited [2012] NZCA 132 at [21].(a) The statutory obligations do not obtain the best price reasonablyobtainable, but to take reasonable care to obtain the best pricereasonably obtainable. That price might not necessarily be obtained.(b) That when the property is sold in a forced sale, such as at a mortgageesale, it is likely to sell at a substantial discount from the market valuethat the property would achieve in a sale undertaken by an owner notunder financial pressure to sell.(c) The evaluations lose much of their significance if reasonable care istaken, there has been no properly advertised and conducted auction,and the property has been sold at auction or by negotiation after theauction.(d) What constitutes reasonable care will always turn on the fact of thecase. The steps taken by the mortgagee in fulfilling the statutory dutyhave to be looked at in the round.(e) In considering the reasonableness of the care taken, the Court shouldbe slow to second guess the actions of a mortgagee acting onapparently sound professional advice.[46] As to the particulars of the breach, Mr He pleads:(a) On 8 August 2019, the fair market value of the property was$2,600,000.(b) BNZ sold the property for $2,010,000.[47] This argument is developed in his notice of opposition. He identifies that oneof his criticisms – presumably the basis upon which BNZ is said not to have takenreasonable care – is that it did not take all necessary steps to obtain access to theproperty, so as to enable it to present it in its best light. Mr Thwaite, in the course ofhis submissions, explored this further by suggesting that BNZ may have been obligedto exercise its contractual right to go into possession of the property and evict thesitting tenant, so that the interior of the property could be shown to prospective buyers.Mr Thwaite emphasised correctly, that it would have been open to BNZ to elect to gointo possession of the property.[48] Ms Armstrong submitted that the evidence establishes BNZ complied with itsstatutory duty. She pointed out that with a total debt of $2.3 million, BNZ had everyincentive to sell the property for its full value. It retained a reputable firm of real estateagents, Barfoot and Thompson, to market the property. The Barfoot and Thompsonrepresentative involved, Mr Davis, was an experienced agent. Relying on his advice,BNZ adopted a four-week marketing and tender sale process. Mr Davis had estimatedthat the market value of the property under normal circumstances would be in the orderof $2.5 million, but that the mortgagee sale value was likely to be closer to $2.1million. Further, Mr Davis took a hands-on role throughout the process, and dideverything within his power to obtain access to the property. Following the four-weekprocess overseen by Mr Davis, he advised that a mortgagee sale range of $2 millionmay need to be considered to achieve a sale. The highest bid in the initial tenderprocess was $1,915,000. Thus Ms Armstrong submitted that the subsequent sale for$2,010,000 was a satisfactory result.[49] In response to the submission that BNZ ought to have taken steps to access theproperty, Ms Armstrong emphasised that, on several occasions during the sales period,Verofi, on behalf of BNZ, wrote both to Mr He and his tenant seeking cooperation toallow Barfoot and Thompson agents to have access to the property. She alsosubmitted, tellingly in my view, that Mr He cannot complain about the lack of accessto the property, when he chose not to engage with those requests as the evidencesuggests.[50] In my view, Mr He's contention that BNZ breached its statutory duty has noserious prospect of suceeding. While BNZ did not obtain the fair market value of theproperty, that is not what s 176 of the Property Law Act requires. Rather it requiresthe mortgagee to take reasonable care to obtain the best price reasonably obtainable.[51] In Public Trust v Ottow, this Court discussed the steps a mortgagee might takeindicating it had made reasonable efforts to obtain the best price:20(a) The appointment of a reputable real estate agent to market theproperty.(b) Obtaining a valuation report from an experienced valuer as a guide towhat could reasonably be expected for the property.(c) Marketing over a reasonably long period of time.20 Public Trust v Ottow (2010) 10 NZCPR 879 (HC) at [31](d) An extensive advertising and promotional campaign.(e) A properly conducted auction.(f) A sale price that, given all the circumstances, can be reconciled withexpert opinion as to value.[52] BNZ appointed Barfoot and Thompson to market the property. It received avaluation report from Opteon New Zealand Ltd (Opteon) which provided a minimumrecommended selling price of $2,100,000. I consider that it was reasonable for BNZto follow Mr Davis' advice with respect to the length of time needed to market theproperty. Further, after a properly conducted tender process, and in light of Mr Davis'subsequent advice, I consider that the final sale price can be reconciled with Opteon'sinitial valuation.[53] In these circumstances, I do not consider BNZ was required to take furthersteps to gain access to the property. Mr He chose not to engage with the requests madeby Verofi on behalf of BNZ for access. Therefore, it was not possible for BNZ to gainaccess by agreement. In my assessment, it would not be reasonable to expect BNZ toincur the not inconsiderable additional cost and suffer the further delay that wouldhave resulted from exercising the right of possession. As in Bank of New Zealand vTaylor, BNZ was not under any obligation to obtain orders giving it possession of theproperty.21[54] In the end, I am satisfied that BNZ is able to demonstrate that Mr He does nothave a reasonably arguable counterclaim.Quantum[55] Ms Armstrong submits that a judgment should be entered against Mr He forthe balance of the unpaid debt, that being $493,729.73, along with costs and interest.[56] Mr Thwaite made no submissions in relation to quantum.21 Bank of New Zealand v Taylor [2013] NZHC 2848 at [59].Conclusion[57] On the above bases my conclusions are that:(a) BNZ is entitled to summary judgment against Mr He in the sum of$493,729.73;(b) BNZ is entitled to interest on that sum at the default interest rate from12 September 2019; and(c) as to costs, my preliminary view is that these should follow the eventin the usual way and that BNZ is entitled to costs on a 2B basis.However, as I have not heard from counsel on costs, I reserve them. Ifcounsel are unable to settle costs, as I would expect them to do, theymay file memoranda and I will deal with them on the papers.[58] There will be orders accordingly.Associate Judge JohnstonSolicitors:Sanderson Weir Ltd, Auckland for plaintiffMillennium Law, Auckland for defendant