The court of appeal, per Hansen and Tate JJA, considered the operation of default notices, service and the doctrine of fair notice in Wilde & Anor v Morgan & Ors [2013] VSCA 250. It was an appeal from a decision of AsJ Derhham in Re: Art Pacific Pty Ltd; Wilde v Morgan & Ors [2013] VSC 330 (27 June 2013).

FACTS

The applicants sought orders, set out at [1], that:

(1) the appointment of the first and second respondents as agents for the third respondent by Deed of Appointment of Agents for Mortgagee in Possession dated 23 October 2012 (the Deed) under a mortgage of land between the second applicant and the third respondent was invalid;

(2) further or alternatively, the first and second respondents entry into possession or assumption of control of the land of the second applicant pursuant to the Deed was invalid.

The issue at the core of the hearing at first instance and on appeal was Read the rest of this entry »

The Victorian Court of Appeal in Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158 considered the test for summary judgment under section 63 of the Civil Procedure Act 2010.

At [35] the Majority (Warren CJ and Nettle JA) stated the test as:

a) the test for summary judgment under s 63 of the Civil Procedure Act 2010 is Read the rest of this entry »

In Violet Homes Loans Pty Ltd v Schmidt & Anor [2013] VSCA 56 the Court of Appeal unanimously upheld the trial judge’s decision that a mortgage originator

FACTS

In Perpetual Trustees Australia Limited v Schmidt & Anor [2010] VSC 67 the trial judge, J Forrest J, found that Violet Homes Pty Ltd (“Violet”) had acted unconscionably and in breach of the general law, section 51AC of the Trade Practices Act and section 12CB of the Australian Securities and Investment Commission Act 2001.

In 2003 the Plaintiff (“Schmidt”) responded to an advertisement which claimed an investment of $40,000 in  syndicate would lead to a net return of $80,000 within 12 months.  Schmidt range the number given and spoke to a Mr Maddocks (“Maddocks”).  In next month he invested $80,000 in the syndicate.  obtained a line of credit from Perpetual Trustees Australia Ltd [12].  In early 2004 Maddocks pursuaded Schmidt to make further investments.  Schmidt was unable to borrow from his bank, the Bank of Melbourne, because he was a pensioner who had no capacity to repay [13].  Maddocks arranged a loan for Schmidt from Perpetual, preparing the loan application and income declaration.  The documents contained false information, as to Schmidt’s employment situation and his annual income.  Schmidt did not provide the false information but signed the documents without reading them [14].  The documents were provided to a finance broker, Medallion Finance Concepts (“Medallion”) who onforwarded them to Violet [16]. Responding to querries by Ms Bonnici a credit officer at Violet, including a failure to provide an ABN, raised Maddocks prepared an amended the application and had Schmidt sign it [20].  At no time did anyone from Violet deal with Schmidt directly.

DECISION

Unconsionability

The Court found that “..recklessness, in the form of wilful blindness, may in some cases supply the necessary element of moral obloquy”[58].  The court said Read the rest of this entry »

The Victorian Court of Appeal in 360 Capital Re Limited v Watts & Ors [2012] VSCA 234 dismissed an appeal from a decision in Watts & Watts & Ors v 360 Capital Re Limited & Anor [2012] VSC 320 which held modifications to the 360 Capital Fund’s constitution were invalid for want to compliance with section 601GC(1)(b) of the Corporations Act 2001 (the “Act”).

FACTS

The 360 Capital Industrial Fund (“360 Capital”) is a managed investment scheme under Chapter 5C of the Act. There are 180.63 million units in the Fund. The Constitution of the Fund relevantly provides, at [4] :

1) Clause 5.1(a): The Trustee could only issue units in accordance with clause 5 and subject to the Constitution.

2) Clause 5.2(a): The Trustee could not grant Options unless the Trust were Listed.

3) Clause 5.4: New Units were required to be issued at a price determined in accordance with clause 5.4.

4) Clause 13.5(a): An Option did not confer on the Optionholder any interest in the Fund.

On 31 May 2012 the directors of 360 Capital executed a Supplemental Deed Poll which Read the rest of this entry »