Wakim v Senworth Capital Pty Ltd [2024] NSWCA 102

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Wakim v Senworth Capital Pty Ltd [2024] NSWCA 102 Hearing dates: 26 March 2024 Date of orders: 10 May 2024 Decision date: 10 May 2024 Before: White JA at [1]; Basten AJA at [8]; Griffiths AJA at [9] Decision: (1) The applicant have leave to appeal the judgment and orders dated 16 August 2023. (2) Within three business days hereof, the applicant file and serve a notice of appeal in the terms of the draft notice of appeal which was filed as part of the White Book. (3) The appeal be upheld. (4) Orders 1 and 2 in the proceedings below dated 16 August 2023 be set aside. (5) In lieu thereof, the judgment entered against the second defendant on 10 November 2022 be set aside. (6) The second defendant bear her own costs of the notice of motion filed in the proceedings below on 21 July 2023 and otherwise the costs of the hearing of the notice of motion be the plaintiff's costs in the cause on the remitted trial. (7) Remit the matter to the Common Law Division. (8) The respondent pay the applicant's costs in this Court. Catchwords: CIVIL PROCEDURE – Default judgment – Setting aside – whether reasonably arguable defence on the merits – where the primary judge failed to have regard to the tension in some authorities on the requirements to establish the proposed equitable unconscionability defence – where the proposed defence under the Contracts Review Act 1980 (NSW) raised an issue of principle, namely whether the unjustness of a contract can be established by reference to matters of which the counterparty was ignorant when the contract was entered into EQUITY – Unconscionable conduct – standard of knowledge of the applicant's special disability or disadvantage required on the part of the other party – whether mere inadvertence or indifference on the part of the stronger party is sufficient as opposed to establishing exploitative or predatory conduct – relevance of the distinction between active and passive conduct on the part of the stronger party EQUITY – Undue influence – Rule in Yerkey v Jones – Effect on third parties – where the applicant claimed to be under the control and influence of her husband – whether actual or constructive knowledge is required on the part of the third party or rather, whether notice of the weaker party's disadvantage is sufficient Legislation Cited: Contracts Review Act 1980 (NSW) ss 7, 9 Cases Cited: Bridgewater v Leahy (1998) 194 CLR 457; [1998] HCA 66 Choi v University of Technology Sydney (No 2) [2020] NSWCA 342 Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447; [1983] HCA 14 Dewar v Ollier [2020] WASCA 25 Garcia v National Australia Bank Ltd (1998) 194 CLR 395; [1998] HCA 48 Gibson v Drumm [2016] NSWCA 206 Hart v O'Connor [1985] AC 1000 Hassoun v Wesfarmers General Insurance Limited t/a Lumley General [2016] NSWCA 76 In re the Will of FB Gilbert (dec'd) (1946) 46 SR (NSW) 318 J & M McNamee Holdings Pty Ltd v Mungerie Vale Pty Ltd trading as Greenwood Group Realtors [2019] NSWCA 283 Kakavas v Crown Melbourne Ltd (2013) 250 CLR 392; [2013] HCA 25 Lopwell Pty Ltd v Clarke [2009] NSWCA 165 Magnate Projects Pty Ltd v Youma Constructions Pty Ltd (No 2) [2005] NSWCA 331 Mavaddat v HSBC Bank Australia Ltd [No 2] [2016] WASCA 94 Nitopi v Nitopi (2022) 109 NSWLR 390; [2022] NSWCA 162 Perpetual Trustee Company Ltd v Khoshaba [2006] NSWCA 41 Pham v Gall (2020) 102 NSWLR 269; [2020] NSWCA 116 Sargeant v HE & FG Campbell Agricultural Machinery Repairs [2016] NSWSC 544 Secretary, Department of Family and Community Services v Smith (2017) 95 NSWLR 597; [2017] NSWCA 206 Senworth Capital Pty Ltd as trustee for the Car Loan Security Trust v W & W Investment Group Pty Ltd [2023] NSWSC 989 Serventy v Commonwealth Bank of Australia [No 2] [2016] WASCA 223 St George Bank Ltd v Trimarchi [2004] NSWCA 120 Stubbings v Jams 2 Pty Ltd [2022] HCA 6; 96 ALJR 271 Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 Yerkey v Jones (1939) 63 CLR 649; [1939] HCA 3 Texts Cited: Meagher, Gummow and Lehane's Equity Doctrines and Remedies (5th ed, 2015, LexisNexis Butterworths Australia) Category: Principal judgment Parties: Anna Wakim (Applicant) Senworth Capital Pty Ltd ACN 629 380 838 as trustee for The Car Loan Security Trust (Respondent) Representation: Counsel: R D Marshall SC/D Moujalli (Applicant) B W J Kidston (Respondent)