Crowe v Commonwealth Bank of Australia

The appeal concerned Mrs Crowe and the Commonwealth Bank of Australia regarding a mortgage granted by Mrs Crowe over her property. Mrs Crowe sought to set aside the mortgage, arguing that the transaction was unconscionable and improvident. She also abandoned any independent challenge to a subsequent loan transaction, conceding that if the earlier mortgage was set aside, the later one should also be.

The legal issues before the court included whether Mrs Crowe was under a special disadvantage due to her lack of education and business experience, rendering the mortgage transaction unconscionable. The court was also required to consider whether the Bank had acted unconscionably by failing to ensure Mrs Crowe received independent financial advice before she entered into the mortgage, and whether the transaction was unjust under the Contracts Review Act 1980 due to material inequality of bargaining power and unfair means employed by the Bank.

The court's reasoning focused on the principles of unconscionable conduct and special disadvantage. It was noted that while Mrs Crowe had expressed concerns to her solicitor about the risks associated with the mortgage, she ultimately decided to proceed, stating that her husband needed the money for a business and that the house was to be kept for the children. The court considered the advice given by Mrs Crowe's solicitor, which clearly warned her of the potential consequences of default, including the loss of her home. The court found that Mrs Crowe was aware of the risks and voluntarily entered into the transaction, and therefore, the Bank had not engaged in unconscionable conduct.

The appeal was dismissed, and Mrs Crowe was ordered to pay the Bank's costs.