Australian Securities and Investments Commission v Rent 2 Own Cars Australia Pty Ltd

The Australian Securities and Investments Commission (ASIC) sought an injunction against Rent 2 Own Cars Australia Pty Ltd, alleging that 232 hire purchase contracts constituted credit contracts under the National Consumer Credit Protection Act 2009 (Cth) (NCCP Act) and the National Credit Code (Code). ASIC also argued that the contracts contravened various sections of the NCCP Act and the Code, as well as the Australian Securities and Investments Act 2001 (Cth) (ASIC Act). ASIC sought relief including an injunction and pecuniary penalties.

The court had to determine whether the hire purchase contracts were credit contracts under the NCCP Act and the Code, considering the elements of provision of credit and the statutory purpose. The court also examined whether conduct alleged to contravene the Code also contravened the ASIC Act, specifically sections 12DA(1), 12DB(1)(a), 12DB(1)(g), 12BAA(7), and 12BAB(1). Additionally, the court considered the state of knowledge required for directors to be found knowingly concerned in the contraventions of the Code and the ASIC Act.

The court found that the hire purchase contracts were indeed credit contracts under the NCCP Act and the Code, as they involved the provision of credit to consumers for the purchase of goods. The court also determined that the conduct alleged by ASIC contravened both the Code and the ASIC Act. Furthermore, the court held that the directors of Rent 2 Own Cars Australia Pty Ltd were knowingly concerned in the contraventions of the Code and the ASIC Act due to the requisite state of knowledge. Based on these findings, the court ordered ASIC to submit proposed forms of relief within 14 days, and directed the parties to discuss and submit proposed directions for the hearing of the penalty question within the same timeframe.

Further submissions on the period of the restraint were to be made within 14 days, and the costs of the proceeding were reserved. The orders and reasons for judgment were dispatched to the parties from chambers in accordance with the Federal Court of Australia Act 1976 (Cth), the Federal Court Rules 2011, and Rule 39.32 of the Federal Court Rules 2011.