BUSINESSDESK: The Commerce Commission has lost a bid to widen its claim against Australian lender Bluestone Mortgages NZ over fees charged on early repayments.
Judge Patricia Courtney turned down the competition regulator's application to extend the timeframe of its claim in the High Court on Auckland earlier this month, saying she had to strike a balance between the rights of borrowers and lenders.
The judgment was published on the Justice Minister's website last week.
The regulator alleges Bluestone breached the Credit Contracts and Consumer Finance Act by charging unreasonable early repayment fees on loans that were typically granted for a 30-year term but usually repaid within the first four years.
The commission is seeking a refund for a number of those fees.
Judge Courtney did not accept the commission's argument that the limitation period should not begin until the fee is actually charged rather than from when the loan agreement is made.
She also disagreed with the regulator's contention that its claim was always representative, and that the amended claim was "no more than a particularisation of the existing claim and is not time barred".
Rather, she said each loan pleaded by the regulator represents a new cause of action with each fee charged specific to the terms of the individual loan.
"Although my finding may prevent some borrowers from claiming relief, I nevertheless consider that it would not be reasonable or fair if a borrower could circumvent the CCCF Act's limitation provisions simply by joining a representative claim," the judgment said.
The anti-trust regulator was attempting to extend the timeframe of its initial claim between April 2005 and October 2006 by a further five years.
This article is tagged with the following keywords. Find out more about MyNBR Tags
Most listened to
- AWF Madison chief executive Simon Bennett says young Kiwis not being able to pass a drug test is “reasonably significant.”
- Scales boss Andy Bowland explains why the board lifted annual guidance again
- Join OMF's Phillip Lindberg and NBR's Andrew Patterson for Currency Talk
- Otago University Professor Andrew Geddis on how election campaigns will change
- Hamilton Hindin Greene's Jeremy Sullivan on why Spark did a deal with Netflix