Australian Retirement Group Pty Ltd v The Commonwealth Bank of Australia Ltd (No 3)

[2022] NSWSC 1188

Supreme Court

New South Wales

Medium Neutral Citation:

Australian Retirement Group Pty Ltd v The Commonwealth Bank of Australia Ltd (No 3) [2022] NSWSC 1188

Hearing dates:

26 August 2022

Date of orders:

26 August 2022

Decision date:

26 August 2022

Jurisdiction:

Equity - Commercial List

Before:

Stevenson J

Decision:

Opt out notice to be sent to all customers whose accounts were reviewed including by way of annual or scheduled review

Catchwords:

CIVIL PROCEDURE – representative proceedings –– identity of group members in dispute – which persons should receive copy of opt out notice

Cases Cited:

Australian Retirement Group Pty Ltd v Commonwealth Bank of Australia Ltd [2021] NSWSC 127

Australian Retirement Group Pty Ltd v The Commonwealth Bank of Australia Ltd (No 2) [2022] NSWSC 439

Category:

Procedural rulings

Parties:

Australian Retirement Group Pty Ltd (First Plaintiff/ Applicant)
Peter Gower Walsh (Second Plaintiff/Applicant)
The Commonwealth Bank of Australia Limited (Defendant/Respondent)

Representation:

Counsel:
I Ahmed and M Ellicott (Defendant/Respondent)

Solicitors:
Hall Partners Pty Ltd (Plaintiffs/Applicants)
Herbert Smith Freehills (Defendant/Respondent)

File Number(s):

2016/86790

EX TEMPORE Judgment (REVISED)

1. The background to this matter is set out in my earlier judgments. [1]

   1. Australian Retirement Group Pty Ltd v Commonwealth Bank of Australia Ltd [2021] NSWSC 127 at [1]-[5]; Australian Retirement Group Pty Ltd v The Commonwealth Bank of Australia Ltd (No 2) [2022] NSWSC 439 at [1]-[2].

2. What presently divides the parties is the identity of the persons to whom an agreed form of opt out notice, the contents of which I have approved, should be sent.

3. In the Statement of Claim, "Group Members" are defined as:

“i.   The borrowers, who fall within the definition of ‘small business’ customers contained in the Banking Code of Conduct, and who entered into facility agreements with BankWest prior to 19 December 2008, and whose loan facilities were the subject of a review by BankWest after 19 December 2008, and that were subsequently placed into the Credit Asset Management (CAM) division of BankWest; or

ii.    Guarantors under the said facility agreements where entered into with BankWest prior to 19 December 2008.”

4. Approximately six years ago, on 26 August 2016 and 9 September 2016, the following particulars were sought and provided:

“Q: … was the review, a review of individual loans undertaken by Bankwest in the ordinary course of business (such as a regularly scheduled annual review of a particular loan)?

A: The review was not done on the basis that it was an annual or scheduled review of a particular loan, and the review was not of a kind carried out in the normal course of business.”

5. The defendant, CBA, submits today that, so particularised, any persons whose files were subject only to an "annual" or "scheduled" review are not relevant and that, accordingly, it should not have to obtain from its records the names and contact details of such persons, but only persons whose files were reviewed otherwise than "annually" or as part of a "scheduled" review.

6. That may have been the case were the answer given by Mr Hall, the solicitor for the plaintiff, to CBA's request have been simply "no.”

7. However, the answer given was that the reviews in question were not done "on the basis" that they were "annual" or "scheduled" reviews of the loans in question.

8. In those circumstances, Mr Hall submits that this captures reviews having the characteristics complained of in the Statement of Claim, in particular being part of what is described as CBA's "Credit Risk Transformation Program"; and whether or not they were also an "annual" or a "scheduled" review.

9. What is at play here is the persons who should receive an opt out notice, not some final issue in the proceedings. It appears to me Mr Hall's contentions are at least arguably correct and that, to err on the side of caution, and to ensure all persons potentially affected as group members in these proceedings are notified of their opt out rights, the formulation of words that Mr Hall proposed is to be preferred.

10. In those circumstances, the parties have agreed on the orders that should be made today.

11. I will make orders in accordance with the agreed Short Minutes of Order which I have initialled and dated.

12. In addition to those orders, I will grant the defendant liberty to apply on short notice to a judge of the Commercial List in the event that the defendant is unable to comply with Order 4 by the date specified.

13. I will list the matter for directions on 24 March 2023.

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Endnote

Decision last updated: 05 September 2022