Bahadori v Permanent Mortgages Pty Ltd

The appeal concerned the jurisdiction of the Consumer, Trader and Tenancy Tribunal to hear applications brought by the appellants, Mr Bahadori and others, against Permanent Mortgages Pty Ltd and others. The central dispute revolved around whether certain credit transactions fell within the ambit of the Consumer Credit Code. The Court of Appeal was required to determine whether the Tribunal had the power to adjudicate these matters, which involved questions about the nature of the credit provided and the validity of declarations made by the borrowers regarding the purpose of the credit.

The legal issues before the Court of Appeal included whether the Consumer Credit Code applied to the transactions in question, specifically whether the credit was provided for personal, domestic, or household purposes, as opposed to business or investment purposes. The court also had to consider the validity of borrower declarations concerning the purpose of the credit and whether a credit contract, as defined by the Code, had been formed. Further, the court examined whether the transactions constituted a series or combination of contracts and arrangements, and crucially, whether the credit provider knew or had reason to believe that the borrower declarations as to the purpose of the credit were false.

The Court of Appeal, comprising Giles JA, Tobias JA, and Campbell JA, reasoned that the Tribunal did possess jurisdiction to hear the applications. The court found that the purpose of the Consumer Credit Code was to protect consumers, and its application depended on the actual use of the credit, not solely on declarations made by borrowers. The court was able to make findings of fact to determine the true purpose of the credit. In matter CA No. 40140/07, the appeal was dismissed, with each party bearing their own costs, except for the costs associated with a specific notice of motion. In matter CA No. 30023/08, the court declared that the Tribunal had jurisdiction to hear the specified applications, quashed the Tribunal's previous decision to the contrary, and ordered that the Tribunal proceed to hear the applications. Costs orders were made in favour of the plaintiffs in this second matter.