CIT Credit Pty Ltd v Keable

CIT Credit Pty Ltd (the appellant) appealed to the Supreme Court of New South Wales, Court of Appeal, against a decision of the primary judge who had dismissed the appellant's claim for $424,498.41 and upheld the respondent's cross-claim. The dispute concerned a guarantee executed by the respondent in favour of the appellant, which the respondent sought to have set aside on grounds of unconscionable conduct under the *Trade Practices Act 1975* (Cth) and unjustness under the *Contracts Review Act 1980* (NSW).

The Court of Appeal was required to determine whether the appellant engaged in unconscionable conduct in contravention of s 51AC of the *Trade Practices Act 1975* and whether the guarantee was unjust within the meaning of the *Contracts Review Act 1980*. Specifically, the court considered whether the appellant had delegated responsibility for the execution of the guarantee, whether the respondent suffered any disadvantage or special disability, and the weight to be accorded to the appellant's failure to implement a scheme for certification that potential guarantors obtain legal advice. The court also examined whether unfair tactics were used, particularly in light of the respondent's failure to read the guarantee.

The Court of Appeal found that the primary judge erred in dismissing the appellant's claim and upholding the respondent's cross-claim. The court reasoned that there was no evidence of unconscionable conduct or unjustness. It held that the respondent had not established any disadvantage or special disability that would attract the protections of either the *Trade Practices Act* or the *Contracts Review Act*. The failure to implement a scheme for legal advice certification was not determinative, nor was the respondent's failure to read the document, in the absence of any other vitiating factors.

Consequently, the appeal was allowed, the respondent's cross-claim was dismissed, and judgment was entered for the appellant in the sum of $424,498.41. The respondent was ordered to pay the appellant's costs of the trial and the appeal, with a certificate for the Suitors' Fund if otherwise entitled.