Australian Securities and Investments Commission v BHF Solutions Pty Ltd

The case of Australian Securities and Investments Commission v BHF Solutions Pty Ltd involved the Australian Securities and Investments Commission (ASIC) suing BHF Solutions Pty Ltd (BHFS) and Cigno Solutions Pty Ltd (Cigno) for contraventions of the National Consumer Credit Protection Act 2009 and the National Credit Code (Code). ASIC alleged that the respondents were engaging in credit activities without the necessary Australian credit licence, providing loan application services and loans to consumers. The primary legal issues were whether the respondents had an arrangement such that the fees and charges imposed by Cigno were charges for the provision of credit under the Code, and whether Cigno was the agent of BHFS or Ms Morrow, a borrower. The court had to determine if the extended definition of contract in section 204(1) of the Code made Cigno a party to the credit contract, and if the reasoning in a previous case, Australian Securities and Investments Commission v Teleloans Pty Ltd, was distinguishable, plainly wrong, or per incuriam.

The court found that ASIC had not established the existence of a Composite Contract between the respondents and that the respondents were not carrying on a business of providing credit. The court held that the extended definition of contract in section 204(1) of the Code did not make Cigno a party to the credit contract and that the reasoning in Teleloans was neither per incuriam nor plainly wrong. The court also found that Cigno was acting as the agent of Ms Morrow or on its own behalf, and not as an agent of BHFS. The application was dismissed with the applicant to pay the costs of the respondents as agreed or taxed.