ANZ class action: Bank urges High Court to reject ‘nuclear option’ in home loan class action lawsuit
Tuesday, 24 March 2026
ANZ has closed its defence in the class action in which borrowers are seeking the return of millions of dollars of fees and interest.
The bank’s counsel, Stephen Hunter KC, asked the High Court in Auckland to reject the “nuclear option” that borrowers were seeking.
A group of about 17,000 ANZ borrowers are seeking the return of millions of dollars in fees and interest they collectively paid on home loans during a period between 2015 and 2016 in which the bank failed to meet its legal disclosure obligations under lending laws introduced in 2014.
They also want statutory damages of up to $6000 each, and penalty interest.
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Borrowers’ counsel Davey Salmon KC told Justice Geoffrey Venning on Monday that the law was clear that lenders which failed to provide legally compliant disclosure had an “absolute” statutory obligation to repay fees and interest charged up until the point they provided compliant disclosure.
But in the second day of the hearing, on Tuesday, Hunter continued with his argument that Parliament had not intended to give people free loans when lenders made accidental, minor errors.
The bank said the borrowers were seeking a “windfall” of interest they had agreed to pay when they took out their loans.
ANZ’s error was to set repayments for 17,000 home loan borrowers too low, the court heard.
That resulted in the borrowers paying off their home loans more slowly, which in turn led to small amounts of interest accruing on the loans.
But Hunter argued the amounts were so small the de minimis legal principle operated, which maintains that the law does not concern itself with extremely minor things.
Hunter argued that the underpayments, and the interest accrued, were so small as to be under the de minimis threshold.
“The average underpayment was $2 a month,” Hunter told Venning.
That added up to interest costs of just a few cents more each month on the average loan of the 17,000 borrowers.
Hunter argued that borrowers were effectively trying to “parlay” errors of a few cents a month into claims to get back thousands of dollars of interest on each of their loans.
ANZ also argued that there was a “quantum meruit” argument, which is the legal principle that prevents unjust enrichment in cases where there was no legally enforceable contract.
The bank also mounted a “reasonable mistake” defence against borrowers seeking statutory damages. It blamed the mistake on a third-party loan calculator developer, and said it fixed the fault promptly after it identified the errors in mid-2016 following customer complaints, and refunded the extra interest it had charged.
The multimillion-dollar class action is being taken under 2014 amendments to the Credit Contracts and Consumer Finance Act (CCCFA) 2003, introduced under Prime Minister John Key, who went on to become chair of ANZ in New Zealand after he left office.
Those laws were intended to “fortify” lending laws, and banks lobbied hard to have it repealed, including in documents the Banking Association sent to the Government arguing “any” errors in disclosure left a bank liable to repay all interest and fees regardless of the materiality or impact on the debtor.
Salmon rejected ANZ’s arguments, and told the court on Tuesday that the law changes were “blunt tools” to achieve Parliament’s policy goals.
Salmon told the court that an attempt had been made last year to change the law to “pull the rug’ from under the class action.
The draft bill for that proposed law change showed the Government believed the law to function as the plaintiffs argued, Salmon said.
Venning, who called the case “important”, reserved his judgment.
Venning retires on March 31, but said he intended to issue his judgment by the end of April.
The case was launched in 2021 by solicitor Scott Russell, and has been funded by litigation lender LPF.
It is an “opt out” class action, so any borrower on whose loan the bank made disclosure errors is included, unless they explicitly asked to be left out.
ASB was originally named in the class action, but last year it settled for $135.6 million without admitting liability.
Class actions remain a rarity in New Zealand, with only three dozen or so ever taken.