Bendigo and Adelaide Bank Limited v Feldman

Bendigo and Adelaide Bank Limited (the Bank) brought proceedings against Mr. Feldman concerning a loan agreement and a mortgage. The dispute centred on the Bank's claim that Mr. Feldman had breached the loan agreement by failing to make repayments, and that it was entitled to enforce the mortgage over his property. Mr. Feldman, in turn, alleged that the Bank had engaged in misleading and deceptive conduct in contravention of the *Australian Consumer Law* (ACL) and sought to have the loan agreement and mortgage set aside. The matter was heard in the County Court of Victoria by Judge Riley.

The primary legal issues before the court were whether the Bank had engaged in misleading or deceptive conduct in contravention of section 18 of the ACL, and if so, whether this conduct caused Mr. Feldman loss or damage. The court was also required to determine the consequences of any such contravention, including whether the loan agreement and mortgage should be set aside or varied.

Judge Riley found that the Bank had engaged in misleading and deceptive conduct by representing to Mr. Feldman that he would be able to afford the loan repayments when the evidence did not support this conclusion. The court applied the principles established in cases concerning misleading representations about future financial capacity, noting that such representations must have a reasonable basis. His Honour concluded that the Bank's conduct was a material cause of Mr. Feldman entering into the loan agreement.

Consequently, Judge Riley ordered that the loan agreement and mortgage be set aside. The court further ordered that Mr. Feldman was not liable to pay any further amounts under the loan agreement and that the Bank was not entitled to enforce the mortgage. The Bank was also ordered to pay Mr. Feldman's costs.