Integrated Securities No 3 Pty Ltd v Creatrix Web Development & Online Marketing Solutions Pty Ltd

The matter before the court involved Integrated Securities No 3 Pty Ltd, the lender, and Creatrix Web Development & Online Marketing Solutions Pty Ltd, the borrower, and its principal, an individual. The dispute concerned the enforceability of a loan agreement under the National Credit Code and allegations of unconscionable conduct by the lender. The primary issues the court had to decide were whether the borrower and the individual, as the principal, were "debtors" under the National Credit Code, and whether they had incurred primary liabilities to repay a deferred debt. The court also had to determine if the lender's conduct was unconscionable.

The court concluded that the borrower and the individual were indeed "debtors" under the National Credit Code as they had incurred primary liabilities to repay the loan. The loan agreement was thus interpreted to give effect to these liabilities. The court found that the onus was on the lender to prove that the National Credit Code did not apply to the loan agreement, a burden the lender failed to discharge. The court further found that the lender's conduct was unconscionable as it failed to obtain the borrower's financial statements, attempted to exclude the operation of the National Credit Code, applied exceptionally high interest rates, required substantial upfront fees, and did not provide financial advice.

The court held that the loan agreement was set aside due to the lender's unconscionable conduct. Additionally, the court ordered that the borrower and the individual were not liable for the principal, interest, fees, or costs incurred by the lender. The court further directed that the security provided by the individual's de facto wife be discharged, and that the lender take steps to finalise the discharge of the security and remove any related encumbrances from the register.