HARVEY & ORS as Trustees of FIRST CREDIT UNION v NEW ZEALAND ASSOCIATION OF CREDIT UNIONS [2019] NZHC 1174

HARVEY & ORS as Trustees of FIRST CREDIT UNION v NEW ZEALAND ASSOCIATION OF CREDIT UNIONS [2019] NZHC 1174

The Court held there was no serious question to be tried that would justify an interlocutory injunction under ss345-348 PLA because those provisions provide post-disposition remedies (s 348) rather than authority for prospective injunctions preventing a disposition; the General Security Deed, on its face, secures indebtedness under the Transaction Documents and is unlikely, on its proper construction, to include BCNs; FCU's asserted prejudice was overstated; balance of convenience and wider public interest in the Continuity Initiative marginally favoured respondents; accordingly the interim injunction application was dismissed.

Citation
[2019] NZHC 1174
Parties
First Applicant: John Rowland Harvey & Ors as Trustees of First Credit Union; Second Applicant: First Credit Union; First Respondent: New Zealand Association of Credit Unions (trading as Co-op Money NZ); Second Respondents: Richard Westlake & Ors as Trustees of the New Zealand Association of Credit Unions
Court
High Court
Jurisdiction
New Zealand
Judgment Date
27 May 2019
Procedural Posture
Civil Interim Injunction Application (credit Union Dispute) / Interlocutory Application Heard 29 April 2019; Judgment on Application Delivered 27 May 2019 (interim Injunction Dismissed)
Outcome
Application for interim injunction dismissed; costs awarded to respondents on a 2B basis
Legal Topics
Security Interest, Disposition (property Law Act Ss345 348), Continuity of Services Arrangements, Trustees' Duties, Major Transaction, Mootness, Disclosure of Board Reports, Interim Injunction
Trusts Corporate/commercial Injunctions Property Law Insolvency Financial Regulation Ppsa/personal Property Securities Security Interest +7 more

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Parties

John Rowland Harvey & Ors as Trustees of First Credit Union

First Applicant

First Credit Union

Second Applicant

New Zealand Association of Credit Unions (trading as Co-op Money NZ)

First Respondent

Richard Westlake & Ors as Trustees of the New Zealand Association of Credit Unions

Second Respondents

Procedural Posture

Civil Interim Injunction Application (credit Union Dispute) / Interlocutory Application Heard 29 April 2019; Judgment on Application Delivered 27 May 2019 (interim Injunction Dismissed)

Legal Issues

  1. 1 Whether granting a security interest under the Continuity Initiative is a 'disposition' attracting ss345-348 PLA and thus justifies a prospective injunction
  2. 2 Whether s 348 PLA authorises prospective injunctive relief or only remedial orders after a disposition
  3. 3 Whether FCU is prejudiced by exclusion from the Continuity Initiative given its BCN holding and limited remaining services from Co-op Money

Ratio Decidendi

The Court held there was no serious question to be tried that would justify an interlocutory injunction under ss345-348 PLA because those provisions provide post-disposition remedies (s 348) rather than authority for prospective injunctions preventing a disposition; the General Security Deed, on its face, secures indebtedness under the Transaction Documents and is unlikely, on its proper construction, to include BCNs; FCU's asserted prejudice was overstated; balance of convenience and wider public interest in the Continuity Initiative marginally favoured respondents; accordingly the interim injunction application was dismissed.

Court Disposition

Application for interim injunction dismissed; costs awarded to respondents on a 2B basis

Orders

  • Application for interim injunction dismissed
  • Costs to First Respondent (Co-op Money) on a 2B basis