Ledinh Sovereign Super Pty Ltd v CT Stone Pty Ltd [2023] NSWSC 1079

Supreme Court New South Wales

Medium Neutral Citation: Ledinh Sovereign Super Pty Ltd v CT Stone Pty Ltd [2023] NSWSC 1079 Hearing dates: 5 & 6 September 2023 Date of orders: 15 September 2023 Decision date: 15 September 2023 Jurisdiction: Common Law Before: Davies J Decision: The plaintiff should bring in short minutes of order to reflect these reasons. Catchwords: CONTRACTS – unjust contracts – Contracts Review Act 1980 (NSW) – where defendants borrowed from lender of last resort – three-month loan with 72% per interest compounding monthly after default – whether asset based lending was unjust - where defendants were experienced mortgagors – where defendants admitted they did not read any documents they signed – where defendants advised by solicitor - whether charging interest at 72% interest per annum compounding monthly is unjust – lenders of last resort ordinarily charge considerably higher interest rates – where matter of paying higher interest was sufficiently brought to defendants' attention – high rate of interest is not itself unconscionable or unjust – asset based lending not unjust - combination of high default rate and monthly compounding makes the contract unjust – held clauses providing for compounding or capitalising of interest be deleted CONSUMER LAW – unconscionable conduct – in connection with financial services – whether delay in commencing proceedings in circumstances where simple interest was accruing at 72% per annum constitutes unconscionable conduct – Australian Securities and Investments Commission Act 2001 (Cth) – nothing to suggest plaintiff deliberately delayed proceedings – where defendants asked for time to repay – where promises were made by the defendants to repay after sale of other properties but no repayment was made – where defendants knew interest was high and ought to have known interest would be accruing – held in all the circumstances delay was not unconscionable Legislation Cited: Australian Consumer Law ss 21, 22, 232, 237 Australian Securities and Investments Commission Act 2001 (Cth) ss 12CA, 12CC Contracts Review Act 1980 (NSW) s 9 Corporations Act 2001 (Cth) Real Property Act 1900 (NSW) ss 57, 138 Cases Cited: Attorney General of New South Wales v World Best Holdings Limited & Ors (2003) 63 NSWLR 557; [2003] NSWCA 261 Australian Competition and Consumer Commission v Geowash Pty Ltd (subject to a deed of company arrangement) (No 3) [2019] FCA 72; (2019) 360 ALR 441 Commonwealth Bank v Lee (1996) 22 ACSR 574 Driat Pty Ltd v Thomas [2012] NSWSC 683 Guardian Mortgages v Miller [2004] NSWSC 1236 Haiqin Lu v Qindi Shen; Weiren Jin v Qindi Shen [2018] NSWSC 560 Hill Foundation Pty Ltd v 131 MVR Pty Ltd [2022] NSWSC 520 Mailman v Challenge Bank Ltd (1991) 5 BPR 11,721 Mastronardo & Anor v Commonwealth Bank of Australia Ltd [2018] NSWCA 13 Mizzi v Reliance Financial Services Pty Ltd & Ors [2007] NSWSC 37 Oxygen Funding Solutions Pty Ltd v Dick-Telfar [2020] NSWSC 582 Perpetual Trustee Co Ltd v Khoshaba [2006] NSWCA 41; (2006) 14 BPR 26, 639 Silvestro v S R Factors Pty Ltd []2010] NSWCA 74 Stubbings v Jams 2 Pty Ltd [2022] HCA 6; (2022) 96 ALJR 271 Takemura v National Australia Bank Ltd [2003] NSWSC 339 Toll (FGCT) Pty Limited v Alphapharm Pty Limited (2004) 219 CLR 165; [2004] HCA 52 Westpac Banking Corporation v Kingsland (1991) 26 NSWLR 700 Texts Cited: B Edgeworth, Butt's Land Law (7th ed, 2017, Lawbook Co) Category: Principal judgment Parties: Ledinh Sovereign Super Pty Ltd (Plaintiff/Cross-Defendant) CT Stone Pty Ltd (First Defendant) Thuc Tran Huynh (Second Defendant/Cross-Claimant) Chau Quach (Third Defendant/ Cross-Claimant) Westpac Banking Corporation (Fourth Defendant) Representation: Counsel: P Newton SC & T Buterin (Plaintiff/Cross-Defendant) D Allen (First, Second & Third Defendants/Cross-Claimants) Submitting appearance (Fourth Defendant)