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Deposit Takers Act 2023

Depositor compensation scheme - Entitlement to compensation - Entitlement rules

206: District Court may make order about shares

You could also call this:

"Court can decide who owns a protected deposit and what share they get"

Illustration for Deposit Takers Act 2023

If you are dealing with a protected deposit, the District Court can make an order about shares. This happens when a certain section of the law, called section 205, applies to you. You must also ask the court for an order and the Bank must not have paid any compensation yet.

The court can decide it is fair to make an order saying who really owns a protected deposit. They can say it belongs to one person or to several people who own shares in it. The court decides what shares are fair.

When the court makes an order, it affects how much compensation you can get under section 203. Your share of the protected deposit is used to calculate your entitlement to compensation. This is unless the regulations say something different.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS593090.

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rules
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205: Protected deposit held by or on behalf of 2 or more persons other than jointly, or

"Protected deposits shared by two or more people, but not owned together"

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207: Partnerships, or

"Partnerships are treated as one person, not many, when it comes to getting compensation"

Part 6Depositor compensation scheme
Entitlement to compensation: Entitlement rules

206District Court may make order about shares

  1. This section applies if—

  2. section 205 applies; and
    1. a person referred to in section 205(1)(a) applies for an order under this section; and
      1. the Bank has not yet paid any compensation under this subpart in respect of the protected deposit.

        1. Despite section 205, the District Court may, if it thinks it is just and equitable to do so, make an order that, for the purposes of this Part, a protected deposit must be treated as being held by, for, or on behalf of—

        2. a particular person; or
          1. 1 or more persons in the shares that the court thinks fit.

            1. A person’s protected deposit, or share in a protected deposit, as specified in an order must be taken into account in calculating their entitlement (if any) to compensation under section 203 (except to the extent that the regulations provide otherwise).