Lender loses High Court bid
Australian lender Solvar has failed in its attempt to be removed from a High Court case taken by the Commerce Commission over alleged breaches of responsibility rules by its New Zealand subsidiary.
The commission alleges Go Car Finance fell foul of the Credit Contracts and Consumer Finance Act (CCCFA) after not sufficiently assessing whether consumers could afford vehicle loans issued between 2019 and 2022.
The watchdog wants the court to order Go Car Finance to pay statutory damages to borrowers and waive any outstanding amounts owed by consumers whose vehicles have been repossessed, reports The Post.
Go Car Finance was pulled from the Kiwi market by Solvar in 2024 and the parent company announced in November last year it had sold its New Zealand loan book for A$8 million (about NZ$9.3m).
Solvar asked to be removed from the commission’s case at a High Court hearing in June, claiming Go Car Finance being a subsidiary did not establish the relationship required for the CCCFA to apply “extra-territorially” to it in Australia.
The company said the commission had to demonstrate Solvar intentionally directed, agreed or consented to Go Car Finance’s alleged failures to abide by responsible lending rules, reports The Post.
The commission told the court Solvar was directly involved in many aspects of Go Car Finance’s operations and “entirely” responsible for its credit and risk function.
In a ruling issued last month, Auckland High Court Justice Paul Cogswell said Solvar may be liable for Go Car Finance’s conduct in New Zealand “if it is found to have directed, consented or agreed to that conduct”.
