Mayfair Trading Co Pty Ltd v Dreyer

HIGH COURT OF AUSTRALIA

Dixon C.J., McTiernan and Taylor JJ.

MAYFAIR TRADING CO. PTY. LTD. v. DREYER

(1958) 101 CLR 428

12 December 1958

Money Lenders (W.A.)

Money Lenders (W.A.)—Defined inter alia as "every person who lends money at a rate of interest exceeding 12 1/2% p.a."—Whether single transaction suffices to satisfy definition—Provision for registration of money lenders—On non-compliance with formalities no security to be "enforceable"—No money lender to lend at rate of interest exceeding prescribed rate—Construction of legislation—Whether provisions limited to money lenders other than those who are such by being persons who lend money at a rate of interest exceeding 12 1/2% p.a.—Whether "enforceable" limited to judicial or curial remedies—Application by borrower in forbidden transaction for specific relief—No provision in legislation for relief sought—Whether borrower must be prepared to refund moneys borrowed as condition of grant of relief—Money Lenders Act 1912-1948 (No. 65 of 1912—No. 54 of 1948) (W.A.) ss. 3, 5, 9, 11A.

Decisions

December 12.
The following written judgments were delivered:-
DIXON C.J. The action out of which this appeal and cross-appeal arise was brought in the Supreme Court of Western Australia by a principal debtor and certain sureties against a firm claiming to be creditors in respect of a loan or loans secured by a deed creating, as to certain assets, a specific charge and, as to the rest of the company's undertaking, a floating charge. The company had made default and a receiver and manager of its business had been appointed and had gone into possession. (at p437)

2. The interest rate charged exceeded twelve and one-half per cent per annum and the plaintiffs said that by this bare fact the defendant firm had constituted itself a money lender under the Money Lenders Act 1912-1948 (W.A.) if not for all purposes at all events pro hac vice. It was thus incumbent upon the defendant firm to register as money lenders and they had not done so. Moreover, it made it necessary that the note or memorandum mentioned in s. 9 of the Act should be signed and delivered as that provision requires and the requirements of the provision had not been fulfilled, the consequence being that the security and, indeed, the whole transaction were unenforceable in point of law. (at p437)

3. In reliance upon this contention the company and the guarantors of the company's liability accordingly instituted the action and sought therein various forms of relief; a declaration that the company was under no liability and that the security and promissory notes given in respect of the loans were "unenforceable", that the promissory notes should be cancelled and delivered up, that a satisfaction of the security, treating it as a bill of sale, should be registered, that an injunction should be granted restraining the defendant firm from attempting to exercise their powers rights and remedies under the security, that the receiver and manager should be ordered to withdraw and to account to the plaintiff company and that he should be restrained from…