De Pasquale v ASCF Managed Investments Pty Ltd

The appeal in De Pasquale v ASCF Managed Investments Pty Ltd involves the appellants, Mr and Mrs De Pasquale, who are the registered proprietors and mortgagors of a residential property at West Beach. The respondent, ASCF Managed Investments Pty Ltd, is the registered mortgagee of the property. The dispute centres around the enforceability of the mortgage and the alleged unconscionability of the loan transaction, particularly considering Mrs De Pasquale's special disability and lack of independent legal advice. The matter was initially heard by the South Australian Supreme Court, where the Master dismissed the appellants' application to set aside the mortgage. The appellants subsequently appealed to the Full Court.

The legal issues before the court include determining whether the appellants can raise new contentions on appeal, whether there are triable issues concerning the enforceability of the mortgage, and if the respondent acted unconscionably. Key issues also involve the attribution of knowledge to the respondent, the adequacy of legal advice provided to the appellants, and whether the respondent’s actions constituted "asset lending" under the Australian Securities and Investments Commission Act 2001 (Cth). Additionally, the court needed to consider if the appellants’ special disabilities, including Mrs De Pasquale’s medical condition and lack of independent legal advice, affected the enforceability of the mortgage.

In allowing the appeal, the Full Court held that it was in the interests of justice for the appellants to raise their new contentions and tender further evidence. The court identified several triable issues, including whether the respondent’s knowledge could be attributed to them, whether the respondent acted unconscionably by providing the loan knowing the appellants were in default and unable to repay without selling their home, and whether the respondent engaged in "asset lending" unconscionably. The court also found that the issue of the appellants' receipt of independent legal advice and the respondent's actions concerning the guarantee and security provided by the second respondent were matters for trial. Consequently, the court ordered that the case be transferred to the ordinary civil list of the General Division to proceed with pleadings and discovery.

The court's decision ensures that the appellants' new contentions and evidence are considered, and the identified triable issues will be litigated in the usual manner, providing a fair opportunity for all parties to present their case. The outcome protects the appellants' right to challenge the enforceability of the mortgage on equitable and statutory grounds, particularly given Mrs De Pasquale's special disability.