Money Managers wins commission case
In a reserved judgement, Justice Geoffrey Venning ordered National Mortgage to pay $745,488, plus interest from March 20, 2003 and costs.
Money Managers took the case to the High Court at Auckland last month, claiming commission from National Mortgage for marketing a $36.4 million contributory mortgage investment in a Landco development at Long Bay, on Auckland's North Shore.
Justice Venning rejected National Mortgage's claim Money Managers breached the Secret Commissions Act by not disclosing the commission to investors.
He also rejected a claim that Money Managers breached contributory mortgage regulations.
The regulations did not apply to Money Managers, Justice Venning said. Even if they did apply, the purpose of the Act was to protect investors, not to provide commercial relief to National Mortgage.
Justice Venning noted that Money Managers' relationship with National Mortgage was not exclusive. It received commissions from about 40 other financial institutions.
"Money Managers satisfies the court that National Mortgage agreed to pay commission at the rate of 2.25% on any replacement contributors required for the second year of the North Shore mortgage investment, and commission at the rate of 2% for those who rolled over their investment for the second year," Justice Venning said.
"There is no basis for the defences or counterclaims raised by National Mortgage."
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