Consumer credit - Preliminary issues - Declaration as to purpose of loan being for investment or business purpose - Whether declaration false - Whether credit intended to be provided for personal, domestic or household purposes - Test to be applied to ascertain intended purpose - Allegation that falsity of declaration known to finance broker - Whether finance broker agent of lender - Earlier judgment obtained on loan agreement and mortgage in Supreme Court - Whether proceedings in Tribunal an abuse of process - Whether subsequent advance of funds constitutes fresh agreement - Whether declaration made in relation to initial advance effective in relation to subsequent advance

Legislation:

Australian Securities and Investments Commission Act 2001 (Cth), s 12CA, s 12CB
Commonwealth Constitution, s 109
Consumer Credit (Western Australia) Act 1996 (WA)
Consumer Credit (Western Australia) Code Regulations 1996 (WA), reg 10
Consumer Credit (Western Australia) Code, s 5, s 6, s 6(1)(b), s 6(5) s 8, s 11, s 11(2), s 11(3), s 70, s 71 s 176(1)
Property Law Act 1969 (WA)
Transfer of Land Act 1893 (WA)

Result:

Application CC 86, 87 and 89 of 2010 dismissed
Application CC 88 of 2010 referred to directions hearing for further directions as to substantive hearing

Category: A

Representation:

CC 86 of 2010

Counsel:

Applicant: Self-represented
Respondent: Mr GD Cobby

Solicitors:

Applicant: Self-represented
Respondent: Gadens Lawyers

CC 87 of 2010

Counsel:

Applicant: Self-Represented
Respondent: Mr GD Cobby

Solicitors:

Applicant: Self-represented
Respondent: Gadens Lawyers

CC 88 of 2010

Counsel:

Applicant: Self-represented
Respondent: Mr GD Cobby

Solicitors:

Applicant: Self-represented
Respondent: Gadens Lawyers

CC 89 of 2010

Counsel:

Applicant: Self-represented
Respondent: Mr M Diamond

Solicitors:

Applicant: Self-represented
Respondent: CWS Lawyers

Case(s) referred to in decision(s):

Australian Broadcasting Commission v O'Neill (2006) 227 CLR 57
Bahadori v Permanent Mortgages Pty Ltd (2008) 72 NSWLR 44
Brott v Shtrambrandt [2009] VSC 467
Commissioner of Taxation (Cth) v Sara Lee Household & Body Care (Australia) Pty Ltd (2000) 201 CLR 520
D'Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1
Esanda Finance Corporation Ltd v Spence Financial Group Pty Ltd [2006] WASC 177
Hunter v Chief Constable of the West Midlands Police (Birmingham Six case) [1982] AC 529; [1981] 3 All ER 727; [1981] 3 WLR 906
Jonsson v Arkway Pty Ltd (2003) 58…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading MCLEAN and PERMANENT CUSTODIANS LTD

Details

AGLC: MCLEAN and PERMANENT CUSTODIANS LTD [2010] WASAT 127
Case: [2010] WASAT 127
Decision Date: 14 SEPTEMBER 2010

CaseChat Overview and Summary

In the matter of McLean and Permanent Custodians Ltd, the respondent sought to challenge a loan agreement and associated mortgage on the grounds that the applicant's declaration of the purpose of the loan was false and that the loan was actually intended for personal, domestic, or household purposes. The dispute was heard in the Supreme Court of New South Wales. The respondent argued that the applicant's declaration that the loan was for investment or business purposes was false and that the credit was intended for personal use. The court had to determine whether the applicant's declaration was false and, if so, whether the finance broker who facilitated the loan knew or ought to have known of the falsity. The court also needed to decide whether the broker was an agent of the lender and whether the proceedings in the Tribunal were an abuse of process. Additionally, the court considered whether the subsequent advance of funds constituted a fresh agreement and whether the declaration made in relation to the initial advance was effective in relation to the subsequent advance.

The court held that the test for determining the intended purpose of a loan involves examining the circumstances surrounding the loan and the conduct of the parties. The court found that the applicant's declaration was false and that the loan was intended for personal, domestic, or household purposes. The court also determined that the finance broker was not an agent of the lender and that the proceedings in the Tribunal were not an abuse of process. The court further held that the subsequent advance of funds constituted a fresh agreement and that the declaration made in relation to the initial advance was not effective in relation to the subsequent advance. The court granted the respondent's application for relief and ordered the loan agreement and associated mortgage to be set aside.

Orders