Credit Corp Services Pty Ltd ACN 082 928 872 v Adam (Civil Dispute) - [2024] ACAT 85

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

CREDIT CORP SERVICES PTY LTD ACN 082 928 872 v ADAM (Civil Dispute) [2024] ACAT 85

XD 386/2024
Catchwords: CIVIL DISPUTE – recovery of a debt incurred on credit card – jurisdictional limit of $25,000 on civil dispute applications – working out the amount of a claim – whether a sum of “contractual interest” is a “claim for interest” under section 19 of the ACAT Act – history of Magistrates Court Act 1930 and the small claims court – the tribunal's jurisdiction excludes claims for interest when distinct from principal debt – ACAT able to hear the matter

Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 6, 18, 19, 22, 24
Court Procedures Act 2004
District Court of Queensland Act 1967
Legislation Act 2001 s 139
Magistrates Court Act 1930 (R42) ss 278, 284

Subordinate
Legislation cited: ACT Civil and Administrative Tribunal Amendment Bill 2016 (No 2)
ACT Civil and Administrative Tribunal Bill 2008 s 19
Court Procedures Rules 2006 (R18) rr 1619, 3740

Cases cited:Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129
Perpetual Executors and Trustees Association of Australia Ltd v Federal Commissioner of Taxation (1948) 77 CLR 1
Platinum Investment Group Pty Ltd v Anderson & Ors [2018] QSC 2
Trinity Law Pty Ltd v Krishinan [2009] ACAT 45
Trpkovski v Williams Love & Nicol Lawyers Pty Ltd (Civil Dispute) [2014] ACAT 13
Trustees of the Roman Catholic Church for the Archdiocese of Canberra and Goulburn as Trustees for St Mary MacKillop College Canberra v Kenningham (Civil Dispute) [2017] ACAT 97
Williams Love & Nicol Lawyers Pty Ltd v Wearne (Appeal) [2016] ACAT 123

List of Text/Papers: Explanatory Statement, ACT Civil and Administrative Tribunal Bill 2008
Presentation Speech, ACT Civil and Administrative Tribunal Bill 2008

Tribunal:Presidential Member H Robinson

Date of Orders:  12 November 2024
Date of Reasons for Decision:      12 November 2024
Date of Publication:  19 November 2024
AUSTRALIAN CAPITAL TERRITORY          )
CIVIL & ADMINISTRATIVE TRIBUNAL     )          XD 386/2024
BETWEEN:
CREDIT CORP SERVICES PTY LIMITED ACN 082 928 872
Applicant

AND:

ABDULIA BADIMSUGRU ADAM
Respondent

TRIBUNAL:Presidential Member H Robinson
DATE:12 November 2024

ORDER

The Tribunal orders that:

The respondent is to pay to the applicant a total of $49,292.73, consisting of:
(a)$19,827.32 principal sum;
(b)$1,031 reasonable enforcement expenses;
(c)$1,270 ACAT filing fee; and
(d)$27,164.41 interest.

………………………………………
Presidential Member H Robinson

REASONS FOR DECISION

This is an application brought in the tribunal’s civil jurisdiction for recovery of a debt incurred on a credit card for which the respondent defaulted on payments. The applicant, a debt recovery company, purchased the principal debt, consisting of purchases and interest and fees of $19,827.32,[1] and now seeks recovery of that debt, plus “contractual interest” of $27.164.41, calculated at 19.99% per annum, and $1,031 for “reasonable enforcement expenses”. In total, the amount claimed at the time of making the application was $49,292.73.
[1] This being the original sum of the principal debt, $21,064.49, less repayments of $1,600 made as set out in background to the decision.
Section 18 of the ACT Civil and Administrative Tribunal Act 2008 (the ACAT Act) provides that the tribunal can hear civil dispute applications and debt applications of up to $25,000:
18      25 000 limit on civil dispute applications
(1)     A civil dispute application cannot be made to the tribunal for an amount greater than the tribunal’s jurisdictional limit, unless section 20 (Abandoning excess to come within jurisdiction) or section 21 (Jurisdiction by agreement—amounts over $25 000) allows the application to be made.
(2)     The tribunal’s jurisdiction is limited to—
(a)civil dispute applications claiming amounts of not more than $25 000; or
(b)in relation to debt declarations—applications for declarations for debts of not more than $25 000.
…
Section 19 of the ACAT Act deals with how to work out the amount of a claim, and says that in working out the amount of an application, a “claim for interest” is to be “disregarded”:
19 Working out amount of application for jurisdiction
(1) In working out the amount claimed, or the amount sought to be declared as a debt, to decide whether the tribunal has jurisdiction in relation to a civil dispute application, the following amounts for the application are to be disregarded:
(a) a claim for interest;
(b) a claim for a lump sum instead of interest.
…
The question before this Tribunal is whether a sum of “contractual interest” incurred under a contract where a debt has been assigned is a “claim for interest” within the meaning of section 19 of the ACAT Act.
The matter was heard ex parte, and the respondent has played no part in these proceedings. Nonetheless, the matter raises the question of the tribunal’s jurisdiction, given the amounts involved, and accordingly, the Tribunal requested the applicant address the jurisdictional issue.

Background

The facts are not in dispute.
At some time in the past (there is no evidence before me as to a precise date) the respondent entered a contract with the National Australia Bank for a “Qantas Plus Credit Card”. The credit card was subject to the NAB Credit Cards Terms and Conditions (the T&Cs). A copy of the T&Cs, as at 1 August 2008, is before the Tribunal.
The T&Cs required the respondent to pay interest on purchases and cash advances, and on outstanding interest payments.[2]
[2] Clause 9 of the T&Cs
From around May 2017, the respondent began to fall behind on his payments. The balance on the credit card as per his statement of account for the period 7 October–6 November 2017 was $21,427.32. At that time, interest was charged at 21.74% for cash advances and 19.99% for purchases.
In around December 2017, NAB assigned the debt to Credit Corp Group, the applicant in these proceedings. A notice of assignment was forwarded to the respondent on 18 December 2017. It cites the principal debt as $21,064.49. This includes purchases and/or cash advances and interest.
Between 21 August 2018 and 17 December 2019, the respondent repaid some $1600 of the debt.
On 23 November 2023 — that is, nearly six years after the assignment — the applicant sent the respondent a “default notice” advising of a debt of some $47,003.24. This debt is described in the notice as the “outstanding balance of your account”. No distinction is made in this document between the principal sum and the interest claimed.
It is not clear from the information before the Tribunal whether any reminder notices were sent to the respondent during the intervening six years. Nothing in the applicant’s submissions suggests that they did. This single letter is all that is referred to under the applicant’s submissions as “attempted resolution”. The applicant now seeks recovery of the total debt, although it is particularised in the application as being a combination of the assigned debt, less repayments, and the subsequent interest and enforcement fees.
At the directions hearing on 2 July 2024, the Tribunal questioned whether this sum was appropriately within the ACAT’s jurisdiction. The applicant agreed to file written submissions on the question. It has, helpfully, done so. The respondent has played no part in these proceedings.

The applicant’s submissions

The applicant’s position is that, while section 18 of the ACAT Act generally sets the jurisdictional limit of the tribunal at $25,000, section 19 of the Act immediately follows and specifically prescribes that the amount of interest is to be disregarded in considering the tribunal’s jurisdiction.
The applicant submits that, in interpreting how these two sections interact, regard should be had to a number of well-established principles:
(a)The principle that where there is a conflict between general and specific provisions, the specific provisions prevail[3] — noting that section 19 of the Act, being the specific provision clarifying the jurisdiction of the tribunal and stating that interest is to be disregarded in determining the tribunal’s jurisdictional monetary limit for civil dispute applications, should prevail over the general provision of section 18;
(b)That the Tribunal should interpret the word “interest” in accordance with its natural and ordinary meaning,[4] and that having regard to this meaning and to the absence of any limiting definition, interest should include both statutory and contractual interest; and
(c)There is a principle that legislation is presumed not to oust established jurisdiction — this should apply where interest is not stated to be limited to statutory interest under sections 18 and 19 of the Act and it would not be appropriate to read the term more narrowly so as to oust the tribunal’s jurisdiction.
[3] Perpetual Executors and Trustees Association of Australia Ltd v Federal Commissioner of Taxation (1948) 77 CLR 1
[4] Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129, 161–162
The applicant also pointed to the section 139 of the Legislation Act 2001:
139 Interpretation best achieving Act’s purpose
(1) In working out the meaning of an Act, the interpretation that would best achieve the purpose of the Act is to be preferred to any other interpretation.
(2) This section applies whether or not the Act’s purpose is expressly stated in the Act.
Further, the applicant submitted, section 6 of the ACAT Act sets out that the objects for the tribunal include: providing for a wide range of matters to be resolved by the tribunal; ensuring that access to the tribunal is simple and inexpensive; resolving applications as quickly and as just as possible; and providing fair decisions (collectively referred to as the “objects”). It would not be fair to deprive the parties of a simple and inexpensive means of resolving this dispute.
All these factors, the applicant submitted, weigh strongly in favour of finding that the tribunal has jurisdiction in this case.
The applicant, very properly, drew the Tribunal’s attention to the decision Platinum Investment Group Pty Ltd v Anderson & Ors [2018] QSC 2 (Platinum), where Burns J of the Queensland Supreme Court, in summary, interpreted equivalent Queensland legislation determining the Queensland District Court’s jurisdiction that:
On the proper construction of section 68(3)(c) District Court of Queensland Act 1967 (Qld) (Version 12 February 2018 to 24 May 2020), which provides “no account shall be taken of any amount awarded or liable to be awarded in the action by way of interest on any amount”, the reference to interest is to discretionary interest, and does not include contractual interest as contractual interest is not discretionary but is part of the “amount, value or damage sought to be recovered” within the meaning of section 68(1)(a) District Court of Queensland Act 1967 (Qld). Accordingly, such interest must be taken into account in determining whether the monetary limit of the District Court is exceeded. [30]–[36].
Contractual interest relates to the substance of the claim and is to be considered in determining the jurisdictional monetary limit because it stemmed from the contract in dispute itself whereas statutory interest under relevant Court legislation is discretionary awarded by the Court, procedural to the claim and is not to be considered in determining the jurisdictional monetary limit.
This decision was, on one level, unhelpful to the applicant, because the Queensland Supreme Court effectively determined, under the equivalent Queensland discretionary interest provision to rule 1619 of the Court Procedures Rules 2006, the word ‘interest’ means only statutory interest when considering the relevant jurisdictional monetary limit. However, the applicant submitted that the decision was of limited cross-jurisdictional application for the following reasons:
(a)If the Tribunal follows Platinum and finds that the contractual interest sought by the applicant is part of the substantive claim, it would greatly hinder the objects of the ACAT Act, where any applicant for a claim of debt with contractual interest exceeding $25,000 would not enjoy the tribunal’s jurisdiction to provide easy, affordable, fair, and efficient resolution of matters; and
(b)To follow Platinum in the ACT may also lead to absurdity, if an applicant and a respondent entered into a loan contract for $25,000, and any contractual interest would automatically exceed the tribunal’s jurisdictional monetary limit.

Consideration

Platinum is an interesting case. It was based on a reading of a section of the District Court of Queensland Act 1967, which is worded very differently from the respective ACAT Act provisions. Having regard to the language of that section, the Queensland Supreme Court concluded the provision was targeted only at removing pre-judgment discretionary interest from computation of the court’s jurisdictional limit. Contractual interest should be considered when assessing whether the claim exceeded the District Court’s monetary jurisdiction. However, following Platinum, the relevant provisions were expressly amended by the Queensland government so as to exclude contractual interest from the calculation of the value of a claim.
The Queensland Supreme Court reviewed the history of the legislation before reaching its decision. I have undertaken a similar exercise for the tribunal’s jurisdiction, but unfortunately it was not as illuminating.

History of the ACAT’s monetary jurisdiction

The tribunal was established by way of the ACT Civil and Administrative Tribunal Bill 2008 (the ACAT Bill). The ACAT Bill, as presented, provided for a $10,000 limit to the tribunal’s jurisdiction, which has since been amended to $25,000,[5] but section 19(1) was otherwise in identical terms to that in the present Act.
[5] ACT Civil and Administrative Tribunal Amendment Bill 2016 (No 2)
The explanatory statement to the ACAT Bill, somewhat unhelpfully, largely repeats the section:
Clause 19 Working out amount of application for jurisdiction
Provides that in working out the amount claimed, or the amount sought to be declared as a debt, to decide whether the tribunal has jurisdiction in relation to a civil dispute application, a claim for interest and a claim for a lump sum instead of interest are to be disregarded.
There is no relevant definition of “interest” in the Bill, nor the subsequent Act, and no discussion of its intended meaning in any explanatory material.
In his presentation speech for the ACAT Bill, the Attorney-General explained the purpose of the tribunal’s civil jurisdiction as follows:
the government has decided to include the small claims jurisdiction in the transfer of functions, as stakeholders put forward a convincing case for its inclusion in the consolidated tribunal. The transfer of the small claims jurisdiction is an attractive option as it does not fit well within the broader civil jurisdiction of the Magistrates Court. The claims procedure is different, and hearings vie for priority with more substantial criminal and other matters. Incorporation within a consolidated tribunal provides the possibility of enhancing access to justice for small civil matters.
In other words, the intention was to confer the Magistrates Courts’ small claims jurisdiction, with its simplified procedures, onto the jurisdiction of the tribunal.
This is reflected in the statutory arrangements. When the tribunal makes a decision on a civil dispute application, the tribunal exercises power of the same nature as a court. Thus, as per section 22(1) of the ACAT Act:
The tribunal has, in relation to civil dispute applications, the same jurisdiction and powers as the Magistrates Court has under the Magistrates Court Act 1930, part 4.2 (Civil jurisdiction).
Looking into the history of the Magistrates Court, its small claims court (Small Claims Court) was established under Part 4.6 of the Magistrates Court Act 1930. Prior to the establishment of the tribunal in 2009, section 284(3) of that Act provided:
(3) The monetary limit on the Small Claims Court’s jurisdiction does not include any claim for interest, or for a lump sum instead of interest, decided by the Small Claims Court under the rules.[6]
[6] Magistrates Court Act 1930 (R42)
Pursuant to section 278 of that Act, “rules” meant “rules under the Court Procedures Act 2004 applying in relation to the Small Claims Court”.
The limiting factor of “under the rules” in section 284(3), stated above, does not exist in the equivalent provisions in the ACAT Act; although, the tribunal does have the power to make “rules” under section 24, and these may prescribe certain provisions of the Magistrates Court Act 1930, in Part 4.2, that do not generally apply (see subsection 22(2)). No such rules have been made.
The Small Claims Court rules, in effect until 1 July 2009,[7] were set out in Part 3.12 of the Court Procedures Rules 2006. Rule 3740 dealt with claims for interest:
[7] Part 3.12 was omitted in the amending Court Procedures Rules 2006 (R18)
3740 Small Claims Court—claim for interest
(MC(CJ)R s 407 and s 454 (1))
(1) This rule does not apply to an application under the Common Boundaries Act 1981.
(2)     This rule applies if interest up to the day of judgment is claimed in a proceeding—
(a)under a contractual agreement between the parties to the proceeding; or
(b)for a debt or liquidated amount.
(3)     The claim for interest—
(a)must state the period or periods for which interest is claimed; and
(b)must state the amount or amounts for which interest is claimed; and
(c)may state the rate or rates at which interest is claimed.
(4)     If a rate is not claimed under subrule (3) (c), the rate is taken to be the rate applying, from time to time, under schedule 2, part 2.1 (Interest up to judgment).
Having regard to the natural and ordinary meaning of the words, and to the context in which they are used, there is nothing to suggest that, for matters in the Small Claims Court, interest could not be considered additional to the claim for a liquidated debt, or that an amount of interest, including contractual interest, would push a claim outside the Small Claims Court’s jurisdiction.
Given the commonality in structure and framework between the tribunal and its predecessor (the Small Claims Court), and the history of the amendments to the Magistrates Court Act 1930 as articulated by the Attorney-General in his presentation speech, it would appear that the intention of the legislature was that the tribunal would have the same jurisdiction as the Small Claims Court. This would suggest that an interpretation that would best achieve the purposes of the ACAT Act would be one that read “interest” as including contractual interest, and interpretated the jurisdictional limitation as being exclusive of interest.
Interpreting “interest” to include “interest” as including contractual interest is also the natural and ordinary meaning of the words, given there are no words of limitation.
The position is, I agree with the applicant, supported by the reasoning in Platinum. There does not appear to be any other relevant case law on this issue, in any jurisdiction.
As such, I accept the applicant’s argument that the tribunal’s jurisdiction excludes any claim for “interest”, be it statutory or contractual, where, as here, the interest was calculated separately and distinctively from the principal debt, and was incurred after the assignment of the debt to the applicant.
The amount being claimed in this case, and in cases like it, is significantly in excess of the amounts that the tribunal could otherwise hear. Nonetheless, I accept that the advantage to the respondent of enabling such a claim is access to a low-cost jurisdiction, which minimises the expenses they would otherwise be put to were the matter to be litigated in a court. That is presumably the intention of the law.

In terms of the “expenses” claimed by the applicant, the current weight of authority of the tribunal is that, where a contract agreement clearly sets out the imposition of a recovery fee so as to recover costs incurred in securing payment, the client, in accepting the costs agreement, is contractually bound to pay the recovery fee under the specified circumstances; at least insofar as they are reasonable costs, reasonably incurred: see Trustees of the Roman Catholic Church for the Archdiocese of Canberra and Goulburn As Trustees for ST Mary MacKillop College Canberra v Kenningham (Civil Dispute) [2017] ACAT 97.[8] No argument contrary to this has been put to me in this case. The claimed expenses in this case are reasonable.
[8] See also Trpkovski v Williams Love & Nicol Lawyers Pty Ltd (Civil Dispute) [2014] ACAT 13; Trinity Law Pty Limited v Krishinan [2009] ACAT 45; and Williams Love & Nicol Lawyers Pty Ltd v Wearne (Appeal) [2016] ACAT 123, all of which relate to legal costs agreements. No contrary argument has been put to the Tribunal in this case.
Accordingly, I am satisfied that the tribunal has jurisdiction to hear and decide the matter.
The respondent is to pay to the applicant a total of $49,292.73, consisting of:
(a)$19,827.32 principal sum;
(b)$1,031 reasonable enforcement expenses;
(c)$1,270 ACAT filing fee; and
(d)$27,164.41 interest.
…………………………………………
Presidential Member H Robinson

Date(s) of hearing:	2 July 2024
Solicitor for the Applicant:	Mr J Ho, Chamberlains Law Firm
Respondent:	No appearance