The New Zealand Insurance Life Ltd v Coleman

Facts

The Defendant was a life insurance representative for the Plaintiff. Under his agency agreement, he could receive advances against future commissions, which constituted a recoverable debt. After his employment ended, the Plaintiff sought to recover $32,080.74 in outstanding advances and other items. The Defendant opposed the summary judgment application, arguing he had an arguable defence based on estoppel. He claimed that representations made by the Plaintiff about the formation of a new corporate agency (the 'Kaimai Group'), in which he would participate, led him to change his position to his detriment. He asserted that from 1 April 1988, his individual agreement was superseded and any debts were the responsibility of the new corporate agency, which was never formally incorporated. A secondary dispute concerned a sum of $4,969.36 for mortgage instalments, which the Defendant claimed had been settled.

Held

1. An agreement by a creditor to forbear from taking action against a debtor for a limited time on specified debts does not, without more, constitute a new contract that supersedes or extinguishes the debtor's original liability.
2. In a summary judgment application, where the evidence regarding a specific portion of a monetary claim is unclear and the court is unable to reconcile the figures, the plaintiff has not met the threshold of showing the defendant has no arguable defence to that portion of the claim.

Orders

Summary judgment granted for the Plaintiff in the sum of $28,048.88, plus interest at 11% from 3 August 1990, and costs of $1,500.00 plus disbursements. The remaining disputed part of the claim, relating to mortgage instalments of $4,969.36 less a rebate of $937.50, is to be dealt with as an ordinary proceeding.

Legislation mentioned

• Judicature Act 1908, s.87
• High Court Rules, Second Schedule, Item 34