Esquilant v Paypal Australia Pty Limited [2021] NSWCATCD 49

Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Esquilant v Paypal Australia Pty Limited [2021] NSWCATCD 49 Hearing dates: 19 May 2021 Date of orders: 5 July 2021 Decision date: 05 July 2021 Jurisdiction: Consumer and Commercial Division Before: G J Sarginson, Senior Member Decision: 1. The application is dismissed. Catchwords: CONSUMER LAW —Suspension of Paypal account — Breach of contract —Unfair contract terms —Unconscionable conduct — No breach established Legislation Cited: Australian Consumer Law 2010 (NSW) Competition and Consumer Act 2010 (Cth) Fair Trading Act 1987 (NSW) Cases Cited: AWD Cavallo Investments Pty Ltd v Smokevitch [2021] NSWCATAP 183 Australian Securities and Investment Commission v Kobelt [2019] HCA 18; (2019) 267 CLR 1 Flight Centre Travel Group Limited t/as Aunt Betty v Goel [2021] NSWCATAP 44 Herbert v American Express Pty Ltd & Ors [2016] NSWCATAP 47 McDonald v Yakiti Pty Ltd & Ors [2021] NSWCA 114 Sabouni v Redevelop Building and Developments Pty Ltd [2021] NSWSC 31 Texts Cited: Nil Category: Principal judgment Parties: Mischa Esquilant (Applicant) Paypal Australia Pty Limited (Respondent) File Number(s): GEN 21/02326 Publication restriction: Nil

REASONS FOR DECISION 1. The applicant conducts a business that partially involves selling products over the internet. 2. The applicant is also a director of Lux Cuttings Pty Limited. According to the applicant, Lux Cuttings Pty Ltd operates a store selling hydroponics products. The business sells products both from a 'bricks and mortar' store and over the internet by way of e-commerce. The applicant's business is based in Sydney, NSW. 3. The respondent operates an internet based payment system that allows users to pay for goods and services electronically by the transfer of funds between individuals and businesses. The respondent is the holder of an Australian Financial Services Licence (No 304962). 4. To use the respondent's services, an account must be opened with the respondent which involves accepting the terms and conditions contained in the respondent's user agreement. 5. According to the applicant, prior to 2018, he had an account with the respondent and Lux Cuttings Pty Ltd had a separate account. 6. On 6 July 2018, the respondent placed a permanent limitation on the account of 'Lux Cuttings'. The respondent placed a limitation on the account due to a risk it identified with some of the types of products being sold. 7. According to the applicant, he used his personal account with the respondent to continue to sell products by e-commerce and have payment for the products made through the Paypal system. 8. On 3 October 2018, the respondent placed a permanent limitation on the applicant's personal account. 9. Lux Cuttings Pty Limited is not a party to the proceedings. Rather, the applicant claims that the respondent breached the terms of the contract between himself and the respondent by reason of the permanent limitation placed on his personal account. 10. The applicant also asserts that the respondent breached 'unfair contract' provisions of the Australian Consumer Law 2010 (NSW) ('the ACL') and unconscionable conduct provisions of the ACL by placing the permanent limitation on his personal account without any valid reason. 11. The applicant filed proceedings in the Tribunal on 18 January 2021. 12. The matter was listed before the Tribunal on 16 February 2021 for a group list and conciliation hearing. Prior to that listing date both parties had filed documentary evidence. The parties were unable to resolve the dispute. The matter was set down for a special fixture hearing, with directions that the respondent to "mail its bundle" (sic) to the applicant by 2 March 2021; and the applicant to "mail to the Tribunal and to the respondent, his reply" by 16 March 2021. 13. The matter was listed for a special fixture hearing on 19 May 2021. 90 minutes had been allocated for the duration of the hearing. The hearing was conducted by telephone. 14. Both parties informed the Tribunal that they were ready to proceed and were not seeking an adjournment for any reason. The applicant appeared and gave evidence. Ms Poole, customer advocacy manager of the respondent, appeared and gave evidence. Both parties were given the opportunity to cross examine the other party.