Marks v GIO Australia Holdings Ltd [1998] HCA 69

High Court of Australia Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ Marks v GIO Australia Holdings Ltd [1998] HCA 69

ORDER Appeal dismissed with costs

Cur adv vult

The following written judgments were delivered:—

11 November 1998 Gaudron J.

1. The facts are set out in other judgments. I shall repeat them only to the extent necessary to make clear my reasons for concluding that this appeal should be dismissed.

2. The appellants entered into loan agreements with the respondents (collectively referred to as the "GIO") in the belief that interest was to be charged at a specified base rate plus a fixed margin of 1.25 per cent, as the GIO had represented to them. The contracts provided for interest as represented, but allowed for variation of the margin. The margin was subsequently increased from 1.25 per cent to 2.25 per cent.

3. The loans were for various different terms as required by individual appellants. Provision was made for an establishment fee of $4,600 which was to be deferred and, ultimately, waived if the loan was maintained for ten years. In April 1992, the GIO notified the appellants that the margin would be increased from 1.25 per cent to 2.25 per cent with effect from 1 August 1992. At the same time, it informed them that, if they wished to refinance before 1 August 1992, they would not be penalised. They were also informed that the "10 year cost recovery [would] be waived" if they notified the GIO of their intention to refinance before 30 June 1992.

4. The appellants elected not to refinance. Instead, they commenced proceedings in the Federal Court seeking to hold the GIO to the margin of 1.25 per cent as a matter of contract law or to obtain relief under the Fair Trading Act 1987 NSW or, in the case of the first appellant and the borrowers represented by him, the Trade Practices Act 1974 Cth (the Act) [1] . The appellants concede that, if the first appellant is not entitled to relief under the latter Act, the others are not entitled to relief under the equivalent provisions of the Fair Trading Act. Accordingly, no further reference will be made to that Act.