Fast Fix Loans Pty Ltd v Samardzic

Fast Fix Loans Pty Ltd appealed to the Court of Appeal of New South Wales against a decision of the primary judge who had found a deed of guarantee and mortgage executed by the respondents, Mr and Mrs Samardzic, to be unjust and void under the Contracts Review Act 1980 (NSW). The dispute concerned a loan facility provided by Fast Fix Loans to the respondents' son, where the respondents acted as guarantors and mortgaged their home as security. The respondents received no direct benefit from the loan facility.

The central legal issues before the Court of Appeal were whether the primary judge erred in finding the deed of guarantee and mortgage to be unjust within the meaning of the Contracts Review Act 1980 (NSW), and consequently, whether it was just to grant relief. Specifically, the court considered whether the lender's failure to make inquiries regarding the guarantors' ability to repay in the event of default, and the fact that the respondents were guarantors rather than the primary borrowers, were relevant factors in determining the contract's unjustness.

The Court of Appeal affirmed the primary judge's decision, holding that the term "asset lending" was not a term of art but an expression used in circumstances where a contract might be found to be unjust. The court reasoned that the relevant inquiry under sections 7 and 9 of the Contracts Review Act 1980 (NSW) is whether the contract is unjust in all the circumstances, and whether it is just to grant relief, without requiring proof of moral obloquy on the part of the party against whom relief is sought. The court found no error in the primary judge's assessment of the circumstances, including the lender's lack of inquiry into the guarantors' capacity to meet their obligations.

The appeal was dismissed with costs.