Across Australia Finance v Bassenger

In the matter of Across Australia Finance v Bassenger, the Federal Circuit Court was tasked with determining the validity of consent orders and the enforceability of a compromise agreement between the parties. The dispute arose from a loan agreement where the applicant, Ms Bassenger, acted as a surety. The lender, Across Australia Finance, sought to enforce the terms of the compromise, which Ms Bassenger challenged on the basis that the consent orders were irregularly obtained and the compromise was unconscionable.

The court had to consider whether the consent orders were irregularly obtained due to the legal practitioner's ostensible authority to bind the client, and whether the compromise agreement could be set aside on the grounds of unconscionability. The court further examined if the compromise could be enforced despite the applicant's contention that she was a surety for an onerous loan and did not fully understand her obligations. The court had to assess if there was a defence available to answer the plaintiff's claim and whether, in the interests of justice, the court should decline to give effect to the compromise.

The court held that there was no irregularity in the obtaining of the consent orders as the legal practitioner had ostensible authority to bind the client. The compromise agreement could not be set aside as the applicant had received independent legal advice and understood her obligations and the nature of the loan. The court concluded that there was no defence available to answer the plaintiff's claim and that the compromise should be enforced in accordance with the terms agreed upon. The orders were not set aside, and the lender was entitled to enforce the compromise as per the terms of the agreement.

The court's final orders were that the compromise agreement would be enforced, and the applicant, Ms Bassenger, was liable for the amount specified in the compromise. The court determined that the legal practitioner had the requisite authority to compromise the litigation, and there were no grounds to set aside the compromise in the interests of justice.