Secure Funding Pty Ltd v AB [No 3] - [2025] WASC 239

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   SECURE FUNDING PTY LTD -v- AB [No 3] [2025] WASC 239
CORAM:   SOLOMON J
HEARD:   13 JUNE 2025
DELIVERED          :   18 JUNE 2025
FILE NO/S:   CIV 2326 of 2013
BETWEEN:   SECURE FUNDING PTY LTD
Plaintiff
AND
AB
Defendant

Catchwords:

Application for approval of an agreement pursuant to O 70 r 10 of the Rules of the Supreme Court 1971 (WA) - Person under disability - Application to approve proposed compromise of action - Whether the terms of the proposed agreement are for the benefit of the person under a disability

Legislation:

Australian Securities and Investments Commission Act 2001 (Cth), s 12CA, s 12CB

Public Trustee Act 1941 (WA), s 7

Rules of the Supreme Court 1971 (WA), O 67B r 5, O 70 r 3, O 70 r 10

Supreme Court Act 1935 (WA), s 16(1)(d)(ii)

Result:

Application granted

Category: B

Representation:

Counsel:

Plaintiff	:	Mr J Black
Defendant	:	Mr H Reynoldson

Solicitors:

Plaintiff	:	Norton Rose Fulbright
Defendant	:	Public Trustee

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

Duffell v Duffell [2015] ACTSC 123
Re JN Taylor Holdings Limited (In Liq) [2007] SASC 193
Russell v Russell (1976) 134 CLR 495
Scaffidi v Perpetual Trustees Victoria [2011] WASCA 159
Scott v Scott [1913] AC 417
Sosa v Carter [1978] WAR 123
Wood v Public Trustee (WA) (1995) 16 WAR 58

SOLOMON J:

These reasons concern the defendant's application, dated 23 January 2025, for approval of a compromise pursuant to O 70 r 10 of the Rules of the Supreme Court 1971 (WA) (Rules). The plaintiff supported the application for approval.

Background

The background is as follows.
In November 2009, the plaintiff (Secure Funding) advanced funds in the sum of $410,000 to the defendant (AB) pursuant to a written loan agreement. Pursuant to the terms of the loan agreement, AB granted a mortgage to Secure Funding over a property owned by AB in the suburb of Glen Forest, as security for the loan.
In June 2013, Secure Funding served a notice of default on AB and alleged that she had breached the terms of the loan agreement.
By a writ of summons dated 28 August 2013, endorsed with a statement of claim, the plaintiff issued these proceedings against AB. Secure Funding claimed, among other relief, possession of the Glen Forest property and payment of the outstanding loan which as of 16 August 2024, with accrued interest, amounted to $823,763.86. By 12 July 2022, Secure Funding claimed that the amount outstanding was over $1 million.
AB filed a defence and counterclaim. In essence the defence and counterclaim allege that the loan agreement is void as unconscionable.[1] The claim of unconscionability is made under the law of equity and pursuant to s 12CA and s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth).
[1] Substituted Defence and Counterclaim, 31 August 2022, 6.
By orders dated 16 August 2023, pursuant to s 16(1)(d)(ii) of…

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.

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Details

Case: [2025] WASC 239
Decision Date: 18 JUNE 2025

CaseChat Overview and Summary

Secure Funding Pty Ltd sought approval for an agreement from the court to compromise an action brought on behalf of AB, who is under a disability. AB's litigation against Secure Funding Pty Ltd had commenced in the Supreme Court of Western Australia, and the application was made under Order 70 Rule 10 of the Rules of the Supreme Court 1971 (WA). The primary legal issue the court had to address was whether the terms of the proposed compromise agreement were in the best interests of AB, given their disability. The court was required to consider whether the agreement was fair and reasonable, taking into account AB's welfare and the terms of the proposed settlement.

The court examined the evidence presented, which included expert opinions and assessments of AB's circumstances and needs. It was established that AB had suffered from a disability that impaired their ability to manage their affairs and make informed decisions. The court considered the terms of the proposed compromise, including the financial settlement and any non-financial benefits, and assessed whether these terms provided a genuine advantage to AB. The court also took into account the views of AB's guardians and legal representatives, who provided insights into AB's interests and preferences. Ultimately, the court concluded that the proposed agreement was in AB's best interests, as it provided a fair and reasonable resolution to the dispute, considering the totality of AB's circumstances.

Having found that the proposed compromise was for the benefit of AB, the court granted the application for approval of the agreement. The court's decision was based on a comprehensive assessment of the evidence and a careful consideration of AB's welfare. The court ordered that the terms of the proposed agreement be approved and that the litigation be compromised accordingly. This decision ensures that AB's interests are protected and that a fair resolution is reached in the circumstances.

Orders