Child v Commonwealth Development Bank

The parties to this matter were the borrower, referred to as Child, and the Commonwealth Development Bank. The dispute concerned a loan agreement, where the borrower alleged a mistake regarding the property mortgaged. The case was heard by the Supreme Court of New South Wales.

The central legal issues before the court were whether the loan agreement was voidable on the grounds of non est factum, whether the agreement was harsh or unjust, and whether it constituted an unconscionable bargain. The court also considered whether the primary judge had erred in exercising their discretion to grant relief under the Contracts Review Act 1980 (NSW).

The court determined that the borrower's mistake was not so fundamental as to render the agreement "radically different" from what they understood, and therefore the defence of non est factum was not established. However, the court found that the loan agreement was indeed harsh and unjust, and that the primary judge had correctly exercised their discretion under section 7(1) of the Contracts Review Act 1980 (NSW) to grant relief. The principles applied focused on the interpretation of non est factum and the application of statutory provisions designed to prevent unconscionable conduct in contractual dealings.

The appeal was dismissed, and the borrower was ordered to pay the costs of the Commonwealth Development Bank.