Ramadan v ACN 098 408 176 Pty Ltd

In the case of Ramadan v ACN 098 408 176 Pty Ltd, the plaintiff, Ms Ramadan, sought to have a loan transaction declared unconscionable and to obtain a remedy under the principles of equity and the Australian Securities and Investments Commission Act 2001 (Cth). Ms Ramadan contended that the loan she obtained from the defendant, ACN 098 408 176 Pty Ltd, was made under unconscionable circumstances due to her special disability, which included limited literacy and very limited English proficiency. The court was required to determine whether the transaction was indeed unconscionable and, if so, what the appropriate remedy would be.

The court considered whether Ms Ramadan's special disability made the transaction unconscionable. It noted her significant disadvantage in understanding financial documents and transactions due to her illiteracy and very limited English skills. The court also examined whether the defendant took advantage of this special disability. The evidence showed that the defendant was aware of Ms Ramadan's limited understanding of the transaction and still proceeded with the loan, which was at a much higher interest rate than available elsewhere. The court held that the transaction was unconscionable under the principles of equity and also under the statutory provisions of s 12CB of the ASIC Act.

The court found that the defendant had indeed taken advantage of Ms Ramadan's special disability and that the loan transaction was unconscionable. Given the unconscionability of the transaction, the court needed to determine the appropriate remedy. After considering the circumstances and the nature of the transaction, the court ordered that the loan be voided and that Ms Ramadan not be required to pay any interest on the loan. The mortgage securing the loan was also discharged.