PA'U V WESTPAC NEW ZEALAND LIMITED HC AK CIV 2011-404-3676

PA'U V WESTPAC NEW ZEALAND LIMITED HC AK CIV 2011-404-3676 [6 March 2012]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV 2011-404-3676[2012] NZHC 365BETWEEN PAUL JUNIOR PA'UAppellantAND WESTPAC NEW ZEALAND LIMITEDRespondentHearing: 6 March 2012Appearances: Appellant in personD J K Mitchell for RespondentJudgment: 6 March 2012(ORAL) JUDGMENT OF PETERS JSolicitors:Turner Hopkins, Auckland – email: douglas@turnerhopkins.co.nzCopy for:Appellant – email: paul.consultants@xtra.co.nzIntroduction[1] Mr Pa'u appeals against two decisions of a District Court Judge at Auckland given in May 2011. One decision was to dismiss Mr Pa'u's application to strike out the respondent's ("Westpac") statement of claim. The other decision was to enterjudgment for Westpac on two of three causes of action which it had pleaded.[2] The Judge dismissed the application to strike out as he did not consider that Mr Pa'u had established any grounds for the making of an order striking out the statement of claim. The Judge considered that the pleadings disclosed a reasonably arguable cause of action and that they were not otherwise frivolous or vexatious or an abuse of process of the Court.[3] The background to the second decision is as follows. Westpac had commenced proceedings against Mr Pa'u in respect of sums which Westpac contended were due from him on three separate accounts.[4] The first account was a Visa Gold credit card account number 45504700009207 ("Visa Gold account"). Westpac alleged that Mr Pa'u held this credit card account between November 2000 and January 2005. Westpac alleged that in February 2005 Mr Pa'u breached the terms and conditions applying to the account by failing to make certain payments that were due. Westpac stopped the account on 4 May 2006 at which time the outstanding balance, together with interest which accrued at 19.95 per cent per annum, was $19,957.02. Westpac sought judgment for this sum, together with a sum for debt collection charges for whichWestpac contended Mr Pa'u was liable.[5] The second account was an Encore current account number 0121200-00("Encore account"). This account appears to have been opened on or about 20 November 1996. On 7 January 2005 the account was overdrawn by $2,130.22. On 7 July 2006 Westpac closed the account and referred the outstanding balance to the same debt collection agency for collection.[6] The third account was a Mastercard. The Judge did not enter judgment in respect of the debt alleged to be due on the Mastercard, because he was not satisfied that Westpac, as opposed to some other financial institution, was entitled to seek judgment on the debt.[7] To conclude, in the second decision the Judge entered judgment for Westpac in respect of the principal and interest claimed on the Visa Gold and Encore accounts. The Judge refused to enter judgment for any part of the claimed debt collection costs because he was not satisfied, on the particular facts of the case, that Westpac was entitled to recover those costs under the relevant terms and conditions. Accordingly, no further issue arises in respect of the Mastercard or on the collection costs.Application to strike out[8] I turn now to deal with Mr Pa'u's appeal against the Judge's decisiondeclining to strike out the amended statement of claim.[9] Mr Pa'u appeals the Judge's decision on this matter on the ground that he has been and continues to be materially prejudiced by what he contends is Westpac withholding documents and, as I understand it, on account of alleged delays by Westpac.[10] The Judge dismissed the application on the basis that Mr Pa'u had failed toestablish any ground for striking out. The Judge considered that the pleadings disclosed a reasonably arguable cause of action and were not otherwise an abuse of process of the Court.[11] I have considered the decision of the Judge on the application to strike out and the evidence that Mr Pa'u filed in support of his application. With respect to Mr Pa'u I can see no possible basis for appealing the Judge's decision dismissing the application to strike out. In my view, the Judge was correct to dismiss that application.Appeal on substantive decision[12] Turning now to the second judgment, there are a number of points which must be addressed.[13] I deal first with the sum claimed on the Visa Gold account.[14] There is no issue as to Mr Pa'u's liability for the account but there is an issue as to the quantum which Westpac contends is owed on the account. Mr Pa'u's caseis that he put quantum in issue in his pleading and also during the hearing of the case.[15] Westpac is only able to produce the statements on the account from December 2001 onwards. By that stage the account was already in debit to at least $11,000.00 and, whilst the balance fluctuated thereafter, counsel for Westpac'srecollection is that the balance on the account never reached zero or went into credit.[16] Mr Pa'u says that it is for Westpac to establish the amount it contends is owing on this account and that he has put proof to Westpac on that issue.[17] The Judge does not appear to have made a finding on the issue of quantum. That may be because the point was not argued forcefully in front of the Judge but it certainly does appear from Mr Pa'u's statement of defence that the quantum of the debt due on the Visa Gold account was in issue. It is for Westpac to establish that quantum.[18] In the absence of the bank statements, it may be that there are aspects of the terms and conditions which are relevant. The issue needs to be determined. It is for Westpac to adduce sufficient evidence to satisfy the Court that the sum it claims is, in fact, owed.[19] The second matter on which Mr Pa'u relied regarding the Visa Gold account concerns insurance. Mr Pa'u brought a counterclaim in which he alleged that he had in place insurance cover that was to respond and meet any outstanding liabilities on the Visa Gold account in the event of his becoming unwell, as he did in about 2004or 2005. There is no documentary evidence of any such insurance being in place and there is no evidence that, if it were, it would respond to a claim by Mr Pa'u in the circumstances which arose.[20] Mr Pa'u's evidence was that he believed that, early on, premia were being deducted from the Visa Gold account but that the deductions appear to have stopped, without him noticing and without Westpac notifying him of the same.[21] A representative of Westpac, Ms du Plessis, gave evidence at trial as to the enquiries that she had made as to whether any such insurance cover was or had been in place. Ms du Plessis' evidence was that she did not consider there was any such insurance. Ms du Plessis gave evidence that she had looked at a "profile" document which it is Westpac's practice to keep in respect of customers. This profile documentusually records matters such as whether there are insurance policies in place, conversations that have been held with the account holder and so on. Ms du Plessis'evidence was that she had looked at the profile Westpac held for Mr Pa'u and therewas no record of any such insurance.[22] Ms du Plessis also gave evidence that she had spoken to the insurers who might have issued such a policy and those insurers had no record of any such insurance cover.[23] The Judge concluded on this point that, if insurance had been in place, it had lapsed by the time the cover was required to respond, that is in or about 2004 or 2005.[24] Mr Pa'u appeals the Judge's determination on this aspect of the case. As I understand his point, it is that Westpac was obliged to give discovery of the profiledocument. Mr Pa'u is correct in that aspect. Westpac was required to give discovery of the profile. Mr Pa'u also contends that, had Westpac done so, his case might havebeen assisted Mr Pa'u also contends that, if the insurance had been in place as hebelieved, then Westpac was obliged to notify him before any such insurance lapsed and there was no evidence that Westpac had done so.[25] I consider that the Judge was entitled to make the finding of fact that he did on the evidence before him. As Mr Pa'u acknowledged, there was no insurance in place at the material time and, in my view, that was the critical issue. I do not seethat any point on appeal can arise in respect of the Judge's finding on that matter.[26] I turn now to matters concerning the Encore account.[27] The Judge took the view that Mr Pa'u had admitted in his statement of defence that he was liable on the Encore account. With respect to the Judge I do not read the statement of defence as making any such admission. Mr Pa'uacknowledged that he had one or more Encore accounts with Westpac but he did not admit that this particular Encore account was one of them.[28] It is for Westpac to establish that Mr Pa'u is liable to meet the debt due on the Encore account at issue in this case. How Westpac does that is a matter for Westpac.It may be able to locate the application to open the account, signed by Mr Pa'u or onhis behalf. An alternative would be to persuade the Court to draw an inference thatthis was Mr Pa'u's account by reference to, for instance, the address or addresses to which statements were being sent, any relevant provision of the terms and conditions or the nature of the transactions on the account.[29] If Westpac is able to establish that Mr Pa'u is in indeed the party liable for thedebit balance on the Encore account, then there are likely to be issues as to costs. Westpac has produced on discovery all of the statements on the Encore account. Mr Pa'u advised me that he has seen these statements but that he did not obtain copies of them. Mr Pa'u should review those bank statements and consider whether or not he was the person operating the account and whether he is liable for the debit balance. If it was his account and he is putting Westpac to proof regardless, then he must be willing to pay the costs of doing so.[30] I propose to remit this matter back to the District Court for further consideration in light of this judgment. The matters which remain outstanding arethe quantum due from Mr Pa'u on the Visa Gold account and whether or not he is the party liable on the Encore account.[31] Each party has had a measure of success on this appeal and I propose to make no order as to costs...................................................................PETERS J