Tribunal to hear Hanover's challenge to its role in teen's case

The Disputes Tribunal will hold a hearing into whether it has the authority to order Hanover Finance to repay a Te Puke teenager $697.

Katie Fallows' father, Michael, has lodged a claim with the tribunal saying the troubled finance company misled the family in its prospectus.

He said he would never have put the 14-year-old's $500 on term deposit with Hanover if he had been given the correct information.

Mr Fallows is claiming the $500 plus interest at 8.5 per cent.

However, Hanover and its part-owner Mark Hotchin have gone to the High Court to argue the Disputes Tribunal does not have the jurisdiction to rule on the matter.

The tribunal was due to hold a hearing into the Fallows claim in Tauranga on September 14.

Wayne Newall, national tribunals manager, said the September 14 hearing would go ahead but would now deal only with the jurisdictional issues.

"If jurisdiction were found, then a further hearing date would be allocated for the substantive hearing."

Meanwhile, Hanover's application for a judicial review of the matter came up in the High Court at Auckland yesterday.

It was put off until the end of next month to allow for the outcome of the Disputes Tribunal hearing.

Hanover argues that any allegations of a misleading prospectus can be dealt with only by the High Court under the Securities Act.

It also says it cannot pay the money because of a moratorium agreed with investors. Hanover froze repayments to 16,500 investors in July last year and has since reached a deal to pay $527 million over five years.