TTW Financial Pty Ltd v TSF Group Pty Ltd

In the Federal Circuit Court, TTW Financial Pty Ltd sought to set aside a default judgment entered in favour of TSF Group Pty Ltd in a matter involving a debt secured by a mortgage over property. The principal dispute was over the amount of interest due on a loan from TTW to TSF, with the primary judgment awarding both the principal sum and interest to TTW. The defence of TSF Group sought to challenge the amount of interest claimed and to set aside the default judgment, arguing that the transaction might constitute a "sham" under the National Credit Code and that the interest charged was unconscionable. The court had to determine whether the defence presented a valid arguable case for setting aside the default judgment, particularly in light of the previous striking out of a similar defence.

The court considered whether the defence of unconscionability was arguable, despite the prior striking out of a similar defence. The court noted that the delay in bringing the application and the extent of prejudice to TTW Financial were significant factors. The court also examined whether the transaction could be considered a "sham" under the National Credit Code, given the nature of the loan and the security provided by an individual who was also the sole director of the company. The court assessed the relevance of these factors and whether they justified setting aside the default judgment, particularly as there was no contest over the principal sum or the lender's right to sell the property.

The Federal Circuit Court held that the defence of unconscionability was not arguable given the delay in the application and the prejudice caused to TTW Financial. The court found that the previous striking out of a similar defence was a significant factor, and the current application was an attempt to resurrect the same defence. The court also determined that the defence of the transaction being a "sham" under the National Credit Code was not sufficiently arguable. Consequently, the court dismissed the application to set aside the default judgment, leaving the judgment for possession and repayment of the principal sum and interest intact.

The final orders of the court were that the application to set aside the default judgment was dismissed, and the default judgment in favour of TTW Financial Pty Ltd remained enforceable. The court did not alter the amount of interest awarded, and the right of TTW Financial to sell the mortgaged property was upheld. The court's decision emphasised the importance of timely and diligent legal proceedings, particularly in cases where similar defences have previously been struck out.