Fair Trading Tribunal New South Wales CITATION: Jonsson v Arkway Pty Ltd [2000] NSWFTT 2 DIVISION: Commercial Division PARTIES: APPLICANT: Ms Jonsson RESPONDENT: Arkway Pty Ltd FILE NUMBER: CM 2000/4593 HEARING DATES: Decision made without hearing; with consent of the parties SUBMISSIONS CLOSED: 30/08/2000 DATE OF DECISION: 24/11/2000 BEFORE: Ms G Fleming Senior Member Consumer Credit (New South Wales) Act 1995 LEGISLATION CITED : Consumer Credit (New South Wales) Code Fair Trading Tribunal Act 1998 Tallerman and Co Pty Ltd v Nathan's Merchandise (Victoria) Pty Ltd (1957) 98 CLR93 CASES CITED: State Bank v Sullivan (1999) NSWSC596 Linkeholt Pty Ltd v Quirk (2000) v SC166 CATCHWORDS: Consumer Credit Code - mortgage - re-opening of the credit contract - civil penalty - transfer to the Supreme Court - presumptions relating to the application of the Code - definitions - trustee company - mortgage investment purposes - application of the code to pre-code contracts - purpose of the provision of credit MATTER FOR DECISION: Jurisdiction Transfer to the Supreme Court REPRESENTATION: APPLICANT: Mr Batley, Solicitor, Legal Aid Commission RESPONDENT: Mr Haney, Shakespeare Hanley Solicitors 1. The Tribunal has jurisdiction in this matter. ORDERS: 2. The application to transfer these proceedings to the Supreme Court is refused. 3. The parties are to submit draft orders as to the progress of this matter to the Tribunal on or before 20 December 2000. 4. The matter is to be listed for a telephone directions hearing on 21 December at 9am. Reasons for Decision: THE APPLICATION 1 On 4 May 2000 by Ms Jonsson ('the Applicant') lodged an application in the Commercial Division of the Fair Trading Tribunal ('the Tribunal') against Arkway Pty Ltd ('the Respondent'). The Application states that in 1995 the Applicant entered into a mortgage with the Respondent in relation to a house and land in Uralba in New South Wales. The mortgage made provision for the loan of the principal sum of $110,000 to the Applicant with repayment of this principal plus interest. The mortgage was subject to variation on 4 October 1995, 4 April 1996, 12 May 1998 and 8 September 1999. 2 The Applicant claims that she did not intend to enter into a mortgage and has had no benefit from the loan. She seeks an order for the re-opening of the transactions on 12 May 1998 and 8 September 1999 pursuant to the Consumer Credit (NSW) Code ('the Code'). She also seeks orders for the imposition of the civil penalty on the Respondent in respect of those transactions. The Applicant claims that these transactions did not comply with the disclosure requirements of the Code and are also unjust. 3 The Respondent has challenged the jurisdiction of the Tribunal to hear this claim. In summary, the Respondent claims that the Code does not apply to the to the transactions between it and the Applicant and as a result the Tribunal has no jurisdiction to hear and determine this application. 4 The Respondent has also submitted that the Tribunal should transfer this matter to the Supreme Court of NSW. On 30 May 2000 the Respondent issued a Statement of Claim against the Applicant in the Supreme Court. That claim is currently not proceeding (pursuant to Section 22 of the Fair Trading Tribunal Act 1998) subject to a direction from the Tribunal that this application be transferred to the Court (section 23 of the Fair Trading Tribunal Act 1998). 5 This decision concerns both the issues of jurisdiction and transfer. With the consent of the parties the Tribunal has determined the issues on the basis of documents without holding a hearing (Section 31(2) of the Fair Trading Tribunal Act 1998). JURISDICTION The Relevant Law 6 The Consumer Credit (NSW) Act 1995 ('the Act') confers jurisdiction on the Tribunal in relation to matters under the Consumer Credit (New South Wales) Code ('the Code'). The Code commenced operation in NSW on 1 November 1996. 7 Section 8 of the Act provides for the jurisdiction of the Fair Trading Tribunal as follows: 8 Conferral of judicial functions (1) The jurisdiction that is expressed to be exercisable by "the Court" under the Consumer Credit (New South Wales) Code and the Consumer Credit (New South Wales) Regulations is exercisable by the following: (a) in the case of any jurisdiction prescribed by the regulations for the purposes of this paragraph only the Commercial Tribunal, [to be read as the Fair Trading Tribunal from 1 March 1999 in accordance with the Fair Trading Tribunal Act 1998 Schedule 4, section 6] (b) except in the case referred to in paragraph (a) either the Fair Trading Tribunal or any court. (c) (Repealed). (2) The jurisdiction co n ferred on a court by this section (other than the Fair Trading Tribunal) is subject to the court's general jurisdictional limits (so far as they relate to the amounts, or the value of property, with which the court may deal), but is not subject to the court's other jurisdictional limits. (3) . . . 8 The Fair Trading Tribunal has exclusive jurisdiction in proceedings brought under section 69, 83(1), 89, 100-104 or 162 of the Code (Consumer Credit (NSW) Special Provisions Regulation1996). In all other matters the Tribunal has concurrent jurisdiction with ordinary courts. 9 The Consumer Credit Code forms an Appendix to the Consumer Credit (Queensland) Act 1994 and is incorporated into New South Wales Law by section 5 of the Consumer Credit (NSW) Act 1995. It represents uniform legislation that applies to all consumer credit lending, without monetary limit, throughout Australia. The Code deals comprehensively with all aspects of consumer lending, from pre-contractual disclosures to the form of credit documentation, changing and enforcing credit contracts, civil penalties, related insurance contracts and remedies for non-compliance. 10 Section 4 of the Code defines 'credit' as follows: 4. (1) For the purposes of this Code, "credit" is provided if under a contract- (a) payment of a debt owed by one person (the debtor) to another (the credit provider) is deferred; or (b) one person (the debtor) incurs a deferred debt to another (the credit provider). 11 Section 5 of the Code states that " for the purposes of this Code, a "credit contract" is a contract under which credit is or may be provided, being the provision of credit to which this Code applies". 12 Section 6 of the Code details the credit contracts to which the Code applies. It provides as follows: Provision of credit to which this Code applies 6. (1) This Code applies to the provision of credit (and to the credit contract and related matters) if when the credit contract is entered into or (in the case of pre-contractual obligations) is proposed to be entered into; (a) the debtor is a natural person ordinarily resident in this jurisdiction or a strata corporation formed in this jurisdiction; and (b) the credit is provided or intended to be provided wholly or predominantly for personal, domestic or household purposes; and (c) a charge is or may be made for providing the credit; and (d) the credit provider provides the credit in the course of a business of providing credit or as part of or incidentally to any other business of the credit provider. (4) For the purposes of this section, investment by the debtor is not a personal, domestic or household purpose. 13 Section 7 of the Code sets out the provision of credit to which the Code does not apply. It does not specifically refer to a transaction such as is in these proceedings. Section 8 of the Code provides as follows: Mortgages to which this Code applies 8.(1) This Code applies to a mortgage if (a) it secures obligations under a credit contract or a related guarantee; and (b) the mortgagor is a natural person or a strata corporation. (2) If any such mortgage also secures other obligations, this Code applies to the mortgage to the extent only that it secures obligations under the credit contract or related guarantee. (3) The regulations may exclude, from the application of all or any provisions of this Code, a mortgage of a class specified in the regulations. 14 Section 11 sets out the presumptions in favour of application of the Code to all consumer credit transactions. It provides as follows: Section 11 Presumptions relating to application of Code 11. (1) In any proceedings (whether brought under this Code or not) in which a party claims that a credit contract, mortgage or guarantee is one to which this Code applies, it is presumed to be such unless the contrary is established. (2) Credit is presumed conclusively for the purposes of this Code not to be provided wholly or predominantly for personal, domestic or household purposes if the debtor declares, before entering into the credit contract, that the credit is to be applied wholly or predominantly for business or investment purposes (or for both purposes). (3) However, such a declaration is ineffective for the purposes of this section if the credit provider (or any other person who obtained the declaration from the debtor) knew, or had reason to believe, at the time the declaration was made that the credit was in fact to be applied wholly or predominantly for personal, domestic or household purposes. (4) A declaration under this section is to be substantially in the form (if any) required by the regulations and is ineffective for the purposes of this section if it is not. 15 Section 176 (5) of the Code deals with 'imputed knowledge of a credit provider' and provides that: 176(5) A credit provider is not, for the purposes of this Code taken to know or have reason to believe something because an officer , agent or employee of the credit provider does so, unless the knowledge or reason to believe that thing is acquired by the officer, agent or employee acting in that capacity and in connection with the transaction concerned. 16 The Respondent submitted to the Tribunal that Section 65 of the Code is relevant to this matter. It provides that parties to a credit contract or mortgage may, by agreement, change its terms as follows: 65. (1) If the parties under a credit contract, mortgage or guarantee agree to change its terms, the credit provider must, within 30 days after the date of the agreement, give to the other party under the agreement a written notice setting out. (a) particulars of the change in the terms of the credit contract, mortgage or guarantee; and (b) any information required by the regulations. Maximum penalty 100 penalty units. (2) Subsection (1) does not apply to a change which defers or otherwise reduces the obligations of the debtor for a period not exceeding 90 days or to an agreement to increase the amount of credit under a credit contract. (3) If the parties under a credit contract propose to increase the amount of credit under the contract by agreement, the credit provider must also, before the agreement is made, give to the debtor a written notice containing the information required by the regulations. Maximum penalty 100 penalty units. (4) This section does not apply to a change made under Division 3. 17 The Applicant seeks relief pursuant to Sections 70 and 71 of the Credit Code and Part 6-'Civil Penalties for defaults of Credit Providers'. Section 70 provides that the Tribunal may re-open a credit contract regulated by the Code if the Tribunal is of the opinion that, in the circumstances at the time it was entered into, it was 'unjust'. 'Unjust is defined to include 'unconscionable, harsh or oppressive.' Section 71 sets out the orders which the Tribunal may make if it reopens a transaction for unjustness. 18 Schedule 2 of the Code contains 'Miscellaneous Provisions Relating to Interpretation'. Clause 7 of Schedule 2 provides that when interpreting: "a provision of this Code, the interpretation that will best achieve the purpose or object of this Code is to be preferred to any other interpretation". Clause 8 then defines and prescribes the appropriate use of 'extrinsic material' in the interpretation of the Code. 19 The Consumer Credit (New South Wales) Regulation 1995 similarly reflect uniform regulation throughout Australia ('the Regulations'). They contains 'Savings and Transitional Provisions" (Part 11). The parties have referred the Tribunal to the following relevant provisions of the Regulations: Definitions 41 In this part- "pre-Code credit contract" means a contract for the provision of credit of a kind to which the Code applies- (a) made before the commencement of the Code; or (b) made after the commencement of the Code if the offer by the credit provider or debtor to enter into the contract was made before the commencement of the Code. 42 Application of Code-Pre-Code contracts other than continuing credit contracts 42(1) The Code does not apply to the provision of credit under a pre-Code contract (other than a continuing credit contract ) or to the contract and related matters. 42(2) To avoid doubt, this section has effect even though credit is provided after the commencement of the Code. 42(3) This section is subject to section 52 of this Regulation . . . 44 Application of Code –mortgages and guarantees 44(1) The Code applies to a mortgage or guarantee made before the commencement of the Code to the extent that it secures obligations under a credit contract, or related guarantee, to which the Code applies or to the extent that it guarantees obligations under a credit contract to which the Code applies. 44(2) However- (a) part 3 of the Code (except sections 54(2)and 56) does not apply to such a mortgage or guarantee; and (b) part 5, division 2 of the Code does not apply to any enforcement action under such a mortgage or guarantee that was commenced before the Code commences to apply to the credit or related guarantee concerned. 44 (3) The remainder of the Code applies only to anything done or omitted to be done in respect of such a mortgage or guarantee after the Code commences to apply to the credit contract or related guarantee concerned. 52 Variation of Existing pre-Code non-continuing credit contracts to increase credit 52 Section 65(3) of the Code applies to a pre-Code contract that is not a continuing credit contract, despite section 42 of this Regulation. Facts/Evidence Relevant to Jurisdiction 20 The Applicant filed a Statutory Declaration dated 14 July 2000. In reply the Respondent filed an Affidavit of Mr Haney dated 1 August 2000. The Tribunal sets out first the facts established by the documents in evidence and the evidence of Ms Jonsson and Mr Haney as to the relevant facts. 21 Ms Jonsson is a forty five year old woman who at all relevant times has been resident in ... , Uralba. 22 On 1 March 1995 Mortgage No 154077Y over Fl 1331106 ('the first mortgage') was executed by Ms Jonsson personally and by Mr Haney for the Respondent, apparently securing an advance of $200,000 to be repaid on 1 March 1996 with interest payable by equal monthly instalments at the rate of 17% pa (or 13% pa if paid within 7 days of due date). The property which is the subject of the mortgage is Ms Jonsson's home in ... , Uralba. The alleged advance was also secured by a Queensland Mortgage No. 700645606 over Lot 238 on RP 89455 ('the Queensland mortgage') being a property in Broadbeach Queensland. 23 The moneys advanced by the respondent to the applicant (and secured by the mortgages) were used to purchase the Broadbeach Waters property. At all times Ms Jonsson has resided at Uralba. 24 On 4 October 1995 the Applicant and Respondent executed a document entitled Variation of Mortgage No. 617128F (the 1995 variation), increasing the principal sum under the first mortgage to $215,000. The Queensland mortgage was similarly varied. 25 On 4 April 1996 the Applicant and Respondent executed a second Variation of Mortgage No. 2079518 (the 1996 variation) extending date for repayment of principal to 1 March 1997. 26 On 12 May 1998 the Applicant and Respondent executed a document entitled Variation of Mortgage No. 3992765A (the 1998 variation) reducing principal sum to $75,000 and extending date for repayment of the principal to 1 March 1999. 27 The Respondent's submissions of 24 June 2000 makes reference to a variation of the mortgage on about 8 July 1998 increasing the principal sum from $75,000 to $90,000. No document reflecting this transaction is in evidence. 28 On 8 September 1999 the Applicant and the Respondent executed a document entitled Variation of Mortgage No. 6208342K ('the 1999 variation) reducing the rate of interest to 15.5% pa (or 11.5% pa if payment paid within 7 days of the due date) and extending the due date for repayment of principal to 1 March 2000. 29 The Respondent submitted that there were no other variations to the mortgage and that there is currently due a principal sum of $90,000 plus interest. Evidence of Ms Jonsson 30 Ms Jonsson set out her evidence in her Affidavit dated 14 July 2000. The most relevant parts of that Affidavit are set out as follows: "3. Between about 1981 and 1990 I was involved in a number of business ventures with my father. These included: a) Approximately, 1981 -1983, Mobil service station at Collinsville, Queensland, b) 1985-1987, 1 was manager and licensee of the Lobster Pot Hotel/Motel, Ballina, a business owned by my father's company; c) 1988-1990, 1 was manager and licensee of the Glen lnnes New Tattersalls Hotel/Motel, the business was owned by my father's company. 4. In all these business arrangements, my father controlled the finances and took care of documents. From time to time he would ask me to sign documents and I would do as he requested. I did not usually read the documents. I usually accepted a short description of the document from my father. 5. To the best of my knowledge and recollection I gave a mortgage over my home at Uralba in connection with the Hotel/Motel business at Glen lnnes. I believe that Shakespeare Haney acted on instructions from my father in arranging this mortgage. 6. In about 1994 1 received confirmation from Shakespeare Haney that the mortgage over my home had been discharged. I was concerned that I had no more involvement in my fathers business affairs but my home had continued to be at risk. My then husband, [Mr Jonsson], and I went to the offices of Shakespeare Haney and saw [Mr Haney], known to me as [Mr Haney]. I told [Mr Haney] to the effect: "We have not had any business dealings with Dad since 1990 and do not want our home to be used as security". I also told him to the effect: "Contact us if Dad wants to use the place as security". [Mr Haney] replied to the effect: "I'll contact you". 7. In about early 1995, my father told me that he wanted to buy a house for my mother, [Ms Davis]. 8. I have no recollection of signing any documents in connection with the purchase of the property at ... , Broadbeach, Queensland. 9. From time to time my father asked me to sign documents of various kinds. Sometimes he represented to me that a document had to be signed to resolve some outstanding issue from our shared businesses in 1990 and before. I do not remember signing any documents at my father's request in early 1995. However, I have seen some documents which appear to bear my signature and which are dated I March 1995. [Paragraphs 10-and 11 state that Ms Jonsson has no memory of signing the Mortgage dated March 1995 although the signature appears to be hers] 13. Annexed and marked "C" is a contract for the purchase of ... , Broadbeach Waters entered on 20 February 1995. this contract names the purchaser as my mother, [Ms Davis]. The signature of the purchaser on the document is the signature of my father, [Mr Davis]. I am informed and believe that this document is from the conveyancing file opened in my name by Shakespeare Haney in 1995 and forwarded to my NSW Legal Aid solicitor in May 2000. 1 first saw this document in June 2000 when my solicitor at NSW Legal Aid showed it to me. 14. Annexed and marked "D" is a letter from John Reid Real Estate to Shakespeare and Haney. I am informed and believe that this letter is from the conveyancing file opened in my name by Shakespeare Haney in 1995 and forwarded to the NSW Legal Aid solicitor in May 2000. The letter noted that the contract was in my mother's name, but named me as the purchaser and noted the writer's understanding that "these contracts have been changed into Mrs Davis's daughter name, and that you will forward the new contract when fully signed to the Vendors solicitor'. 15. Annexed and marked "E" is a copy, of the contract naming me as purchaser. This contract is signed by my father in the following manner: "[Mr Davis] for Purchaser". I had not seen this document until my NSW Legal Aid solicitor showed it to me in June 2000. 16. I never gave instructions to Shakespeare Haney about the purchase of ... , Broadbeach. I never received any correspondence from Shakespeare Haney about the purchase of ... , Broadbeach. Most of the letters addressed to me in the file are addressed as follows-. "[Ms Jonsson] c/- [Mr Davis], ... , Beenleigh, QLD 4207". Annexed and marked "F" and "G" respectively is a letter from Shakespeare Haney dated 9 February 1995 and a copy of the letter. Both these document's are in the conveyancing file. To the best of my recollection I never received an original letter in the terms of annexure "F". 17. I never authorised Shakespeare Haney to accept instructions from my father on my behalf. In fact I told [Mr Haney] not to allow anything to be done in my name without informing me. 18. At some point, my father informed me that ... , Broadbeach, was in my name. I am not sure whether this occurred before or after the property was purchased. When he did tell me, it was in words to the following effect: "It's in your name because when I drop of the twig, you'll look after mum". At about that time, my father had told the family that he had emphysema. 19. Annexed and marked "H" is a variation of mortgage bearing my signature and dated 4 October 1995. My signature is purportedly witnessed by [Mr Haney]. I do not recall signing this document. However, I am certain I did not sign this document in Mr Haney's presence. I have never signed a document in Mr Haney's presence. I have only attended Mr Haney's office on the one occasion referred to in paragraph 6. 20. Annexed and marked "I" is a copy of an undated form bearing my signature which purports to authorise Shakespeare & Haney to sign documents in connection with an advance of $215,000 to me. I have no recollection of signing this document. 21. Annexed and marked "J" and "K' respectively are variations of mortgage dated 4 April 1996 and 12 May 1998. I do not recall signing these documents. However, I am certain that I did not sign them in the presence of [Mr Haney]. 22. I did not become aware of my involvement in these transactions nor that there was a mortgage over my home until about June 1998. I separated from my [husband] in about October 1997. In about June 1998 his solicitor wrote to me proposing a property settlement. 23. In the course of negotiations about the property settlement I learned that there was a mortgage in favour of Arkway Pty Ltd over my home. 24. [My husband] claimed an entitlement to division of property including ... , Broadbeach. I disputed that I had any interest in the property. I had not contributed any money to its purchase, to the best of my knowledge all the loan repayments were made by my father. I thought of it as my mother's house. 25. In about August or September 1998, 1 received letters from La Trobe Home Loans of Australia alleging that I was in default in payment of loans through them. My father told me to the effect that La Trobe had a mortgage over ... , Broadbeach. I had no knowledge of these loans before this and I do not recall signing any loan documents. My father told me that he had put the Broadbeach property on the market because he could not pay the debt. 26. In about November or December 1998 [my husband] applied for interim orders in the Family Court in Lismore to restrain me from dealing with the proceeds of any sale of Broadbeach. 27. On 22 December 1998, 1 agreed to orders in terms of the document annexed and marked "L". My then solicitor advised me to consent to the orders. I did as I was advised, but I regarded it as unfair that [my husband] should get any part of my mother's house. 28. Following the sale of Broadbeach in about January 1999, the La Trobe mortgages were discharged and approximately $31,000 paid to my solicitor. Of this money, $8,000 was paid towards an Esanda vehicle lease taken out by my father in my name. [My husband] received $28,000, $5,000 of which came from an advance on my Visa card. $5,000 was sent to my solicitors in a cheque payable to my mother. To the best of my knowledge this money was used by my solicitors to pay part of their bills. 29. In about December 1998 my father told me he could not keep up the loan repayments and he gave me a payment book. I was afraid that if I did not make the payments I would lose my house. I commenced making payments in January 1999. 1 made the following payments- DATE AMOUNT 4 January 1999 $975.00 29 January 1999 $975.00 8 March 1999 $975.00 1 April 1999 $975.00 5 May 1999 $975.00 7 June 1999 $875.00 5 July 1999 $875.00 15 October 1999 $875.00 12 November 1999 $875.00 2 December 1999 $875.00 30 December 1999 $875.00 31 January 2000 $875.00 29 February 2000 $875.00 30. In about June 1999 1 executed a form of variation of mortgage. A copy of the document is annexed and marked "M". My then solicitor advised me to sign the variation form. I had been unable to refinance the loan and he advised me to the effect that if I did not sign it I would lose my house. He told me that signing the document would save me money because it was a lower interest rate. He did not tell me that by signing the document I might lose other rights in relation to the earlier transactions. I am informed and believe that the executed variation was sent by my solicitor to Shakespeare Haney in September 1999. 31. Between about 1995 and 1997 my father entered other transactions in my name. Some of these transactions involved forgery of my signature. The debt to Esanda referred to in paragraph 28 above arose from a transaction entered by my father in my name and from which I received no benefit. 32. Between 1995 and 1998, 1 occasionally signed documents at my father's request. Annexed and marked "O" is a number of documents bearing my signature. I do not have all the documents. Those I do have, I found unexpectedly at my home. I understood that they related to a lease of advertising billboards. I signed them at my fathers request in about November 1995. They had been faxed to me by my father with a request that I sign them and forward them to a Mr Vaggelas. I have been advised that the documents appear to relate to the purchase of property in Queensland. I do not know what happened to this transaction, but I do not believe that the purchase was completed. 33. At all times, I believed that ... ,, Broadbeach was to be my mother's home and that my father would pay the loan for the home. I would not have knowingly given a mortgage over my home at Uralba. 34. I did not expect to receive any benefit from the Broadbeach property. Following the, sale of the property, the only "benefit" I received was payment of my solicitor's fees. Evidence of Mr Haney 31 Mr Haney is a Director of the Respondent and the Principal of the Shakespeare Haney Solicitors which is acting for the Respondent. He set out his evidence in his Affidavit dated 14 August 2000. The most relevant parts of that Affidavit are set out as follows: 2. The Respondent is a trustee company noted with the Queensland Law Society for first mortgage investment purposes. The Respondent holds its mortgage as trustee for the persons who have contributed moneys in the mortgage. 3. The Respondent had in or about April 1992 previously advanced seventy two dollars ($72,000.00) to the Applicant on security of her property at ... , Uralba (the New South Wales Property). 4. This earlier mortgage had been arranged by the Applicant's father, [Mr Davis], for whom my firm, Shakespeare Haney, had acted for some time and at all times he had acted as agent for the Applicant. 5. The earlier mortgage was repaid in full in 1994. I seek leave to refer to paragraph 6 of the Affidavit of the Applicant sworn the 14 th July 2000 and say that I deny that at any stage the Applicant attended my office and told me that she did not want to have any further business dealings with her father or for her home to be used as security and for her to be contacted if her father attempted to use it as security. 6. In or about 'January 1995 1 received an executed Contract of Sale between [Mr O'Hea] and [Ms O'Hea] as Vendors and [Ms Jonsson] as Purchaser for a property situate at ... , Broadbeach Waters (the Queensland property). 7. I acted for the Applicant in relation to the conveyance and the Respondent engaged McIvor Coghlan, Solicitors to act on its behalf in relation to an advance of two hundred thousand dollars ($200,000.00) which was being made to the Applicant as finance for completion of the Contract of Sale. Correspondence in relation to that conveyance was sent to the Applicant care of her father as was the usual practice when I had previously acted on behalf of the Applicant on instructions from her. 8. As appears from the Queensland Bill of Mortgage being exhibit "B" to the Affidavit of the Applicant the Queensland property was the primary security for the advance of two hundred thousand dollars ($200,000.00). The New South Wales Mortgage being exhibit A to the Applicant's Affidavit is collateral security to the Queensland Mortgage . The reason that collateral security was required was because the Queensland property was not sufficient security to ensure the Respondent kept within its required loan to value ratio (LVR) of 70%. 9. In relation to paragraph 16 of the Applicant's Affidavit I say that exhibit "F" refers to the enclosure of a Form Q Declaration which is a Queensland Stamp Duty Form on a contract which is sworn where a person is applying for concessional stamp duty on a Contract where the property being purchased by that person is to be their principal place of residence. Given that the Applicant was not residing in the Queensland property it is possible this letter never was sent as a Form Q was not applicable to her. 10. In relation to paragraph 17 of the Applicants Affidavit I say that the history of instructions I had received from the Applicant and her father was that her father, Mr Davis acted as her authorised agent. I deny that the Applicant ever told me not to allow anything to be done in her name without informing her. 11. In relation to paragraph 19 of the Applicant's Affidavit I say that if the document to the Applicant's Affidavit has her signature witnessed by me then I am certain that that was the case as it is not my practice to be witnessing people's signature if they have not signed the document in my presence. 12. In relation to paragraph 28 of the Applicant's Affidavit I say that it is apparent that whilst the Applicant is denying she had an interest in the Queensland property it is clear that she received the benefit of at least thirty one thousand dollars($31,000.00) from the sale of that property which was a contribution towards the property settlement with her then husband. If these moneys had not been paid to her then they, would have been applied in reduction of the moneys owing under the Respondent's Mortgage. 13. In relation to paragraph 29 of the Applicant's Affidavit I say that I have checked the Respondent's records and confirm that the payments referred to have been made by the Applicant. At no stage during this period when the Applicant was making these payments did she ever dispute the debt or query the Mortgage or otherwise give the Respondent notice of any problem which she considered existed in relation to the debt. 14. In or about March 1999 I caused a Variation of Mortgage to be sent to the Applicant care of her father together with a bill of costs in relation to the extension of the loan for a further twelve (12) months. A copy of my letter and account dated 3rd March, 1999 is exhibited hereto and marked "TJH I". 15. Following the failure of the Variation of Mortgage being returned to me on the 18 th May 1999 1 wrote to the Applicant directly seeking return of the Variation of Mortgage documents. [Paragraphs 16-22 of Mr Haney 's affidavit refer to correspondence between the parties from June to July 1999 concerning the mortgage documents. This includes correspondence from Baker Mannering and Hart, Solicitors for Ms Jonsson, and a facsimile from Greater Building Society in relation to refinancing of the loan.] . . . 22. By letter dated 6th September, 1999 Baker Mannering and Hart provided to me the Variation of Mortgage duly executed by the Applicant. Now produced and shown to me and marked "TJH 9" is a true copy of a letter from Baker Mannering and Hart to Shakespeare Haney dated 6 th September, 1999. 23. Despite the Applicant obviously obtaining legal advice in relation to this matter at no stage did Baker Mannering and Hart ever raise with me either verbally or in correspondence any concerns in relation to the Applicants liability under the Mortgage or dispute the Respondents entitlement to money claimed under it. 24. In relation to paragraph 33 of the Applicant's Affidavit I say that the Respondent had no knowledge of the true dealings as between the Applicant and her parents and at all times it was the Respondents view that the Queensland property was an investment property which had been bought by the Applicant. 25. In relation to paragraph 34 I say that it is clear from the terms of paragraph 28 of the Applicant's Affidavit that she received a benefit of a least thirty one thousand dollars ($31,000.00) following the sale of the Queensland property. This payment is inconsistent with the Applicant denying she had any interest in that property. Furthermore, the terms of the property settlement between the Applicant and her former husband can only be consistent with the Applicant having an interest in the Queensland property and her being entitled to the sale proceeds of that investment property. The Applicant's Submissions 32 The Applicant filed written submissions on 29 June 2000 and 22 August 2000. The Applicant contends that the transaction on 12 May 1998 was a provision of "credit" within the meaning of Section 4 of the Consumer Credit Code. The effect of the transaction being to defer payment of a debt allegedly owed by the Applicant to the Respondent as at 1 March 1997 (the due date for repayment of the principal amount under the mortgage as varied on 4 April 1996). 33 The Applicant submits that the mortgage dated 1 March 1995 as varied on 12 May 1998 secures obligations under a credit contract. The variation of mortgage dated 8 September 1999 was a provision of credit in that payment of the alleged debt from the applicant to the respondent which fell due on 1 March 1999 was deferred. The provision of credit made on 8 September 1999 with effect from 1 March 1999 is secured by the mortgage as varied. 34 The Applicant submits that, pursuant to Section 11 of the Consumer Credit Code, the Code is presumed to apply to the mortgage and the provision of credit (with effect from 1 March 1997) on 12 May 1998 and the mortgage and the provision of credit (with effect from 1 March 1999) on 8 September 1999. 35 The Applicant submitted that: "Acceptance of the respondent's ingenious argument . . . that the debtor must have a conscious purpose in order for the Code to apply would severely undermine the legislature's intention to provide protection to consumers when it enacted the Code. . . The Code contemplates two classes or types of purpose for credit and no other. They are, on the one hand, "personal, domestic or household" purposes and, on the other hand, "business or investment" purposes. . . . The Code does not permit of an interpretation that, where there is "no purpose", it is effectively a business or investment purpose and the Code does not apply. Parliament's intention is made clear by the enactment, in section 11 of the Code, of a presumption that the Code applies. 36 The Applicant referred the Tribunal to Clause 7(l) of Schedule 2 to the Code which provides that: "in the interpretation of a provision of this Code, the interpretation that will best achieve the purpose or object of this Code is to be preferred to any other interpretation." 37 The Applicant submitted that the correct interpretation of section 6. is that the Code applies unless it is established that the borrower has the conscious purpose of using the credit predominantly for a investment purpose. Alternatively, the Applicant's understanding that she was helping provide a home for her mother should be seen as a "personal" purpose. 38 The Applicant argued that the transitional provisions in the Consumer Credit Regulation recognise the possibility that a pre-Code mortgage could secure obligations which are regulated by the Code. Section 44(l) of the Regulation provides: "The Code applies to a mortgage or guarantee made before the commencement of the Code to the extent that it secures obligations under a credit contract, or related guarantee, to which the Code applies or to the extent that it guarantees obligations under a credit contract to which the Code applies." 39 The Applicant referred to the terms of the mortgage which recognise that the liability of the mortgagor to the mortgagee could arise under more than one contract. (Clause 3 of the mortgage). The Applicant submits that the transactions on 12 May 1998 and 8 September 1999 were provisions of "credit" within the meaning of section 4 of the Code and that on each occasion a liability from the Applicant to the Respondent which was immediately due and payable was deferred. Therefore the Code applies in full to each provision of credit after 1 November 1996 and it applies to the mortgage except to the limited extent excluded under section 44(2) of the Regulation. The Respondent's Submissions on Jurisdiction 40 The Respondent filed written submissions on the question of jurisdiction on 29 June 2000 and 10 August 2000. The Respondent submits that: "Prima facie, given that the applicant's residence has at all material times been the Uralba property, the provision of credit from the respondent to the applicant has been for an investment by the applicant, ie the purchase of the Broadbeach Waters property. No other purpose for which the credit was provided has been suggested by the applicant." 41 The Respondent relies on Section 6(4) of the Credit Code, to the effect that investment by a debtor is not a personal, domestic or household purpose. Accordingly the Respondent argues that the Credit Code does apply to these transactions. Further: ". . .the relevant purposes referred to in s6(l)(b) of the Credit Code are the purposes as agreed by the parties or, alternatively, the purposes as known by the credit provider. . . .This is confirmed by the provisions of s 11(3) of the Credit Code which essentially provide that a business declaration under that section is ineffective where it is shown the credit provider knew or had reason to believe the credit was in fact to be applied wholly or predominantly for personal, domestic or household purposes." 42 The Respondent submits that: ". . .the relevant purposes for s6(l)(b) of the Credit Code are those as agreed by the parties or, alternatively, the purposes as known by the credit provider is confirmed when one has regard to the overall purposes and objects of the Credit Code. The Credit Code regulates the provision of certain credit and, inter alia, imposes various obligations on a credit provider. The Credit Code provides for offences and the imposition of penalties on the credit provider for breaches of its provisions. If it was the case that the relevant purposes under s6(1)(b) were only those of the debtor or known by the debtor, a credit provider could unwittingly, and through no fault of its own, breach the provisions of the Credit Code, commit offences and incur penalties when it is unaware, of the debtor's purpose,- or ulterior purpose for the use of the credit". 43 In submissions in reply to the Applicant's submissions the Respondent argued that the "personal, domestic or household purposes" referred to in s6(l)(b) of the Credit Code refer to purposes of the debtor only and not any other person". Ms Jonsson, says the Respondent: "knew and understood that the purpose of the credit provided ... was for the purchase by the applicant of an investment property at Broadbeach Waters". 44 The Respondent argued that: ". . assuming for the purposes of this application that the affidavit of the applicant sworn 14 July 2000 is true and correct and accepted in its entirety, then the evidence of the applicant is that: (a) the provision of the loan, the execution of the various mortgages and variations of mortgages all occurred without her knowledge or consent; (b) all transactions were at the instigation of her father and for his purposes (c) - none of the moneys lent were for the applicant's benefit or purposes. Accordingly, on the applicant's own evidence, the loan could not be said to be for the personal, domestic or household purposes of the applicant as required by s6(l)(b) of the Credit Code." 45 The Respondent also submitted that contract law governing the contract provides that ".. where an original contract is varied, the original contract is not rescinded or determined (see Tallerman & Co. Pty Ltd v Nathan's Merchandise (Victoria) Pty Ltd (1957) 98 CLR 93). 46 The Respondent argues that the Credit Code does not apply to these transactions because the Code came into operation on 1 November 1996 and does not have retrospective effect. It is argued that the mortgage of 1 March 1995 is a pre-code contract not subject to the Code, regardless of whether that contract is varied after the commencement of the code. In the alternative the Respondent submitted that the provisions of the Credit Code may only apply to the actual contracts of variation and those variations. The Credit Code does not apply to the mortgage or those obligations which they secure which still subsist and have not been varied. 47 This is subject to the requirements of Section 65(3) of the Code which ". . will only apply where it was proposed to increase the amount of credit under the contract. None of the variations of mortgage or 1 March 1997 or 1 March 1999 increased the amount of credit at all. The variation of mortgage of 1 March 1998 did not increase the amount of credit beyond the original amount of credit of $200,000. In the circumstances, s65(3) does not apply and the Fair Trading Tribunal has no jurisdiction." FINDINGS AND REASONS ON JURISDICTION 48 There are two primary issues for resolution of the Tribunal disclosed in the above evidence and submissions. They may be stated simply as follows: Are the original Mortgage and related credit contract of March 1995, the Variation of Mortgage and related credit contract of 12 May 1998 and the Variation of Mortgage and related credit contract of 8 September 1999 regulated by the Consumer Credit Code? If the answer to the above is yes, then, does the 'purpose' of those transactions exempt them from the provisions of the Consumer Credit Code? In other words was the credit 'provided or intended to be provided predominantly for personal, domestic or household purposes'? Application of the Code to Pre-Code Contracts 49 The Tribunal finds that Section 11(1) of the Code places the onus is on the Respondent to establish, by evidence, that the Code does not apply to the credit contracts in dispute in this matter, namely the mortgage of 1 March 1995 and the variations of mortgage of 12 May 1998 and 8 September 1999. 50 The original mortgage of 1 March 1995 secured the provision of $200,000 in credit from the Respondent to the Applicant. The mortgage document (No 154077Y) contains the credit contract as 'Annexure A' to the mortgage. The variations of the mortgage dated 12 May 1998 and 8 September 1999 were similarly each in the form of a single mortgage document which incorporated the credit contract by reference to the original mortgage. The variation to the terms of the credit contract was stated at Point 'G' on the face of the 'Variation of Mortgage' document. 51 The Tribunal finds that the original mortgage (No 154077Y) secures obligations under a credit contract which is a 'pre-code credit contract' as defined in section 41(a) of the Regulations, being a contract for the provision of credit of a kind to which the Code applies, made before the commencement of the Code. On normal principles which preclude retrospective application of legislation the original mortgage is not subject to the Code. Similarly Section 44 must be read to have no application to the original mortgage of 1 March 1995. However the variations of the mortgage dated 12 May 1998 and 8 September 1999, which incorporate the terms of the original mortgage by reference, are post-Code transactions which may attract the application of the Code. 52 Section 42 of the Regulations provides that the Code does not apply to a 'pre-code contract' and consequently, the credit contract of 1 March 1995 is not a contract 'to which the Code applies'. However Section 42 must be read subject to section 52 which provides that section 65(3) of the Code applies to a pre-code credit contract 'despite section 42 of the Regulation'. Section 65(3) requires that where the amount of credit is to be increased by a variation, the credit provider to give written notice of certain prescribed matters to the debtor where a credit contract, mortgage or guarantee is changed by agreement. 53 As a general principle the Code does not have retrospective effect to pre-code contracts. However the Code and the Regulations are silent as to their application to variations of a pre-code credit contract. Lanyon, in her commentary on the Code contained in 'Australian Consumer Credit Law' (Butterworths , Vol 1 at 15799) notes that: A variation contract made after the Code commences could be regulated by the Code since it may itself be a credit contract within ss5 and 6. If so, the credit provider would have to comply with ss14 and 15. This may be very difficult, especially identifying the amount of credit and the annual percentage rate. For all these reasons, it is anticipated that credit providers will prefer to refinance pre-Code contracts rather than to vary them." 54 The Tribunal is of the view that section 44(3) has a role in the regulation of variations to a pre-code mortgage which are secured by a credit contract regulated by the code. In this matter the variations executed on 12 May 1998 and 8 September 1999 were variations of both the mortgage contract and the credit contract. The variation of the mortgage contract was referable to the terms of the original mortgage. 55 The clear weight of authority is to the effect that a variation of a contract is determined by the intention of the parties. A variation will generally leaves the balance of that contract on foot, as of the date of the original contract, unless the contract as a whole or in part is expressly rescinded (Taylor J in Tallerman & Co Pty Ltd v Nathan's Merchandise (Victoria ) Pty Ltd (1957) 98 CLR 93 at 144). It might be argued that the variations of 12 May 1998 and 8 September 1999 were merely changes to the terms on which the credit was provided and the debt deferred. The deferral of the debt remaining as the date of the original contract of 1 March 1995. The Tribunal rejects this argument. 56 The Tribunal is satisfied that the 'variation' of the credit contracts of 12 May 1998 and 8 September 1999 were transactions to which the Code applied by virtue of sections 4, 5, 6 and 8; (subject to the Tribunal's determination in relation to the 'purpose' of the provision of credit). They concerned a fresh provision of credit which was secured by the existing mortgage which deferred payment of a debt. The Tribunal is strengthened in this view because of the particular circumstances in this matter. On the evidence before the Tribunal it appears that at the time of each variation the date for repayment of the debt under an earlier variation of the mortgage and credit contract had already passed. As at 12 May 1998 repayment of the principal owing under the contract had been due since 1 March 1998. The terms of the loan were spent and the Respondent was in a position to take action against the Applicant for recovery. Similarly, as at 8 September 1999 repayment of the principal had been due since at least March 1999, and possibly July 1999 ( if the variation referred to by the Respondent which is not in evidence before the Tribunal was in fact executed). The Tribunal finds that the purported 'variations' to the credit contracts on the dates in issue constituted the 'provision of credit' within the meaning of that term in the Code as at those dates. 57 The Regulations do not otherwise provide for the application of the Code to a variation of a pre-code mortgage (being a mortgage which secures obligations under a credit contract, section 8 of the Code). Section 44 of the Regulations applies to the Mortgage of 1 March 1995 to the extent that it secures obligations under the credit contracts of 12 May 1998 and 8 September 1999 (section 44(3)). 58 The exceptions in Regulation 44 are of significance in understanding the application of the code to a pre-code mortgage and related credit contract. Part 3 of the Code (except sections 54(2) and 56) which regulates the form of regulated mortgages and other matters prohibited by the Code does not apply to a pre-code mortgage. Part 5 Division 2 of the Code, which concerns the ending and enforcement of credit contracts, mortgages and guarantees also does not apply. 59 The end result of this reasoning is that if a pre code credit contract, mortgage or guarantee is varied after the commencement of the Code it is subject to Section 65(3) and, where the amount of the credit under the contract is increased, the debtor must be given the prescribed notices. Where that variation amounts to a provision of credit pursuant to the Code then the variation to the pre-code credit contract will itself be regulated by the Code. In addition if, after commencement of the Code, (1 November 1996) anything is 'done or omitted to be done' in respect of a mortgage related to the provision of credit which was entered into prior to this time, then the Code will apply. 60 The application of this interpretation to the facts of this case is as follow: The original mortgage of 1 March 1995 is a mortgage which secured the provision of credit under a credit contract of the same date. The mortgage was executed prior to the commencement of the Code on 1 November 1996. The Code only has application to the original mortgage of 1 March 1995 to the extent that it secures obligations under a credit contract to which the Code applies (Section 44 of the Regulations). The Code has no application to the credit contract of 1 March 1995 (Section 42 of the Regulations). The variations of 12 May 1998 and 8 September 1999 are contracts for the provision of credit which are regulated by the Code. They are secured by the mortgage of 1 March 1995 as varied. The Code applies to 'anything done or omitted to be done' in respect of the mortgage of 1 March 1995 ('the related mortgage') as of the 12th May 1998 (Section 44(3) of the Regulations) being the day the Code commenced to apply. 61 The containment of the mortgage and credit contract within the one document is confusing to the extent that the terms set out in the mortgage document at Annexure A are the terms of the credit contract. However the application of the Code in the restricted way envisaged above does not affect the form of the mortgage and credit contract as they were prior to 12 May 1998. Whether or not it is applicable to the form of the variations is a matter for consideration in the substantive hearing of this application. 62 The Tribunal is of the view that this interpretation is consistent with the principles of consumer protection and 'truth in lending' which are embodied in the Code. This is uniform legislation which is intended to regulate all consumer credit dealings in Australia in a fair and consistent way. 63 At the same time, this interpretation protects the credit provider from any unfairness associated with giving legislation retrospective effect. Clearly parties cannot comply with legislation which is not yet passed. The exceptions in Regulation 44 relieve the credit provider of obligations in relation to the form of the mortgage documents and the Code provisions on the ending and enforcement of the mortgage. To require compliance with these provisions when the mortgage was executed prior to the Code would obviously be ludicrous. 64 The application of the Code to later transactions provides for the consumer protection principles embodied in the Code to have effect as and from its commencement. Purpose of the Provision of Credit 65 The Respondent argues that the Code does not apply to the transactions because the purpose of the provision of credit to Ms Jonsson was investment. This is a matter for the Respondent to prove on the evidence. 66 The Code is unclear as to whether the relevant 'purpose' is that of the debtors actual purpose in obtaining the credit or the purpose to which the credit provider believes the credit will be put.(For a discussion of this point see A Duggan and E Lanyon Consumer Credit Law, Butterworths 1999 at 60). The Tribunal is of the view that it is inquiry and determination of Ms Jonsson's, (the debtors) actual purpose in obtaining the credit which is relevant to the determination of this issue. It may be inferred from the wording of both section 6 and section 11 that it is the debtors actual purpose in relation to the use of the credit which must be ascertained. 67 The words 'personal, domestic household' are not defined in the Code and are to be determined in accordance with their ordinary meaning. This phrase is however has a counterpart in section 52 of the Trade Practices Act (Cth) in relation to 'goods and services' and it is well understood in that context (see State Bank v Sullivan [1999] NSWSC 596 (14 July 1999). It is essentially a question of fact in each case. 68 The Tribunal notes the words of Justice Gillard in Linkeholt Pty Ltd v Quirk [2000] VSC 166 (5 May 2000) where his honour was similarly called upon to determine the 'purpose' of a credit transaction under the Code: In my opinion, it is appropriate to consider what the money was used for in order to determine the purpose of the provision of the credit. In considering the question it is important to consider the substance of the transaction in the context of its performance. 69 Section 11(2) of the Code provides a mechanism for the conclusive rebuttal of the presumption that credit is provided for 'personal, domestic or household purposes'. This mechanism is the completion of a declaration that the credit is not provided for this purpose which is made substantially in the form set out in the Regulations. Ms Jonsson did not complete a section 11 declaration. 70 Importantly, the procedure set out in section 11 enables a credit provider to establish that a transaction is not for a purpose to which the Code applies. Had the Respondent obtained a declaration of the kind referred to in Section 11 then it would have been able to rely on it as evidence of the purpose of the transactions in this matter. The failure to obtain the relevant declaration is related to the Respondent's belief the original mortgage and subsequent variations were unaffected by the Code because the original mortgage was executed before the Code came into effect on 1 November 1996. 71 The Respondent submits that Ms Jonsson's evidence admits of 'no purpose' in that she denies her active involvement in the transactions and refers to the action of her father in procuring the loans. The Tribunal agrees with the submission of the Applicant that the Code does not contemplate a provision of credit which meets 'no purpose'. It is unlikely that such a case would arise where a person genuinely borrowed a substantial amount of money with no purpose in mind. There might however be claims that the that there purported borrower was subject to a fraud. In that case there is clearly no 'purpose' in the person upon whom the fraud is committed and who appears in the transaction as a borrower. The Code does not expressly contemplate this scenario in the terms of sections 6 and 11 but rather distinguishes between purposes which are predominantly 'personal, domestic or household' and those which are predominantly for 'business or investment'. However section 11 does not require the 'true purpose' of the borrower to be ascertained. A section 11(3) declaration would, for example, not be rendered ineffective because the declaration was found later to be false in that the credit was used for a different purpose. Section 11 is an important evidentiary provision which related to 'any proceedings' in which purpose is in issue. The Tribunal does not accept that where, for instance, credit was provided to a person on the basis of a fraudulent representation, the Code would be presumed not to apply. This is exactly the kind of transaction with which a law concerned with consumer protection seeks to address. 72 The Tribunal has found that the Code applies to the transactions dated 12 May 1998 and 8 September 1999. Section 6 provides that the relevant purpose of the 'provision of credit' is to be determined at the time when the contract was entered into. It is thus the purpose of Ms Jonsson at the time of those transactions which is relevant. 73 The Tribunal is not here determining the substantive merits of Ms Jonsson's claim to have the transactions reopened although much of the evidence is common to both this and the issue of 'purpose' in relation to the loan. It should also be remembered that the evidence before the Tribunal is by way of documents and was not tested by cross examination. 74 The evidence before the Tribunal is that Ms Jonsson at no time lived in the in the property in Queensland which, together with her own home in Uralba, NSW, was security for the loan. The Tribunal accepts that she was involved in a number of business transactions with her father from 1981 to 1990. It is clear that Ms Jonsson knew of the loans in relation to the Queensland property some time in 1998 proceedings. While she has stated that she does not recall signing the Variation of 12 May 1998, it bears her signature. The Queensland property was again brought to her attention in June 1998 in the course of her divorce. 75 The Tribunal also accepts that Ms Jonsson knew of the loans in 1999 prior to signing the Variation of Mortgage dated 8 September 1999. She made repayments in fear of losing her home in Uralba. The Tribunal also accepts Ms Jonsson's evidence that she believed at all times that the Queensland property was the home of her mother. 76 The Tribunal does not accept the Respondent's contention that the provision of credit to the Applicant has at all times been for investment by the Applicant in the Queensland property. At all times the Applicant's mother resided in that property. There is no evidence that the Applicant rented the property or otherwise gained any commercial benefit from it. The evidence before the Tribunal is that Ms Jonsson's involvement in the original mortgage was for the purpose of financing a home for her mother. To the extent that the evidence establishes Ms Jonsson had any purpose in relation to the variations of the mortgage in May 1998 and September 1999 it was to preserve her own home in Uralba. The Tribunal is of the view that these are 'personal' purposes' no 'business or investment purposes'. 77 Having carefully considered the evidence and submissions, the Tribunal is not satisfied that the Respondent has established that the credit extended to Ms Jonsson by the original mortgage and the transactions of 12 May 1998 and 8 September 1999 were not intended to be provided wholly or predominantly for personal domestic or household purposes. 78 Having made the above findings the Tribunal has jurisdiction to hear this application. TRANSFER The Relevant Law 79 Section 23 of the Fair Trading Tribunal Act 1998 provides as follows: Transfer of proceedings to other courts or tribunals (1) If all parties so agrees or the Tribunal of its own motion or on the application of a party so directs, proceedings instituted in or before the Tribunal must be transferred in accordance with the rules of that court, to a court that has jurisdiction in the matter and are to continue before that court as it they had been instituted there. Respondents Submissions on Transfer 80 The Respondent wants to proceed in the Supreme Court with its proceedings for possession of the Uralba property. The Respondent argues that: ". . . the Tribunal does not have jurisdiction to hear and determine proceedings for possession.. . . The matters alleged and the relief claimed under ss7O and 71 of the Code as set out in the application could, if proved, give rise to defences or other similar relief at common law, in equity or pursuant to the Contracts Review Act in the Supreme Court possession proceedings. The Tribunal has no jurisdiction to hear or determine such defences or provide that other relief to the applicant. . . Subject to the outcome of the Tribunal proceedings, the respondent will have to continue or recommence proceedings for possession against the applicant at the conclusion of the Tribunal proceedings. Subject to possible but remote arguments of estoppel, the respondent will be able to raise those other defences or other relief in the possession proceedings. In any event, as a practical matter, any argument as to estoppel would not be heard until the final hearing of the possession proceedings. 81 The Respondent argues that transfer will not cause prejudice to the Applicant and that she "will be able to raise all other defences and other relief in the Supreme Court which she presently is unable to raise in the Tribunal." At the same time it argues 'real prejudice' to it if the proceedings are not transferred in the event that it is successful in the Tribunal proceedings will then still need to be brought in the Supreme Court for possession of the property, resulting in increased cost and delay. It would also, argues the Respondent, result in a ". . waste of judicial resources for there to be two sets of proceedings on essentially the same facts or issues." Applicant's Submission on Transfer 82 The Applicant submitted that at the time she made her application to the Tribunal no issue arising under the application was the subject of dispute in proceedings pending before a court. Under Section 22 of the Fair Trading Tribunal Act the Supreme Court has no jurisdiction to hear or determine the issue. 83 The Applicant opposes the Respondent's application for transfer of the matter to the Supreme Court. The Applicant argued that the additional cost, delay and inconvenience which this would cause were significant issues for her. The Applicant also submitted that: " The Tribunal has exclusive jurisdiction to determine the application for the imposition of a civil penalty: section 8(l) Consumer Credit Administration Act 1995 and clause 5 Consumer Credit (New South Wales) Special Provisions Regulation 1996. It also has exclusive jurisdiction to order compensation to the Applicant for breaches of key disclosure requirements and/or other contraventions of the Cod…. Therefore, the possibility of two sets of proceedings would not be avoided if the matter were transferred to the Supreme Court….. " Findings and Reasons on Transfer 84 This application was lodged in the Tribunal prior to the commencement of other action in the Supreme Court. The Tribunal therefore has jurisdiction over this matter to the exclusion of all other courts by virtue of Section 22(3) of the Fair Trading Tribunal Act 1998. 85 The Tribunal is of the view that it is not relevant to the transfer of these proceed that the Applicant is represented by a Solicitor from the Legal Aid Commission. 86 The Respondent referred the Tribunal to the defences available to it pursuant to the Contracts Review Act (NSW) 1980. It should be noted that section 70 of the Code are based on the Contracts Review Act and are substantially the same terms. The Tribunal does not accept the Respondents view that there are 'defences' to such an action which are only arguable before the Supreme Court nor that the relief available in the Tribunal is limited. Section 71 of the Code, which sets out the orders which the Tribunal might make on an application to re-open the transaction. The Contracts Review Act does, however, provide specific remedies in relation to a 'land instrument' which the Respondent may seek to activate in this matter. 87 The Tribunal places significant weight on the fact that the Applicant has chosen the Tribunal as the forum for resolving this dispute and does not consent to the transfer of these proceedings to the Supreme Court. The Tribunal obviously, and intentionally, operates differently to a court. Proceedings are informal, expeditious and inexpensive (Sections 3, 27, Fair Trading Tribunal Act 1998). It is precisely for these reasons that Ms Jonsson has chosen to lodge this application in the Tribunal and the Tribunal has a statutory duty to determine the application. 88 Section 23 of the Fair Trading Act 1998 provides for the transfer of matters to a Court of competent jurisdiction where both parties consent to that transfer or the Tribunal of its own motion transfers the proceeding. The Tribunal is of the view that this provision is relevant where, for instance, 'new' law is being tested or where the determination of legal issues might affect a large number of potential claimants. In other cases, the consent of the parties is a crucial element in the Tribunal's consideration of whether to transfer a matter pursuant to section 23. The Tribunal also has specific power to refer a question of law to the Supreme Court where this is deemed necessary (Section 62). 89 The legislature has vested both exclusive and concurrent (with the courts) jurisdiction in the Tribunal under the Credit Code. This allows the Tribunal to develop a high level of expertise in matters under the Code, as was the case with the Commercial Tribunal of NSW. This matter is not one of such complexity nor of effect on such a large number of litigants that it would warrant transfer to the Court. It would be expected that in matters under the Credit Code it is desirable for matters to be heard in a forum which is inexpensive and informal. The Tribunal is such a forum. In addition the procedural flexibility which the Tribunal has is demonstrated by the use of the power to determine matters ' on the papers', without an oral hearing, which has been used in this case. 90 On balance, the Tribunal is not persuaded that the Respondent's claim to disadvantage through 'double litigation' is sufficient to warrant transfer of this claim. The Application was already before the Tribunal when proceedings were commenced by the Respondent in the Supreme Court. To transfer the matter to the Court on the basis that the Respondent would be in a more convenient position to pursue an action for possession of the property is to pre-empt the outcome of these proceedings. It would also do so at significantly greater cost to the Applicant. 91 The Tribunal refuses the application to transfer the proceedings to the Supreme Court. 92 The Tribunal has made further directions to facilitate the progress of this application to hearing on the substantive claim. They are set out below. DECISION AND ORDERS 1. The Tribunal has jurisdiction in this matter. 2. The application to transfer these proceedings to the Supreme Court is refused. 3. The parties are to submit draft orders as to the progress of this matter to the Tribunal on or before 20 December 2000. 4. The matter is to be listed for a telephone directions hearing on 21 December at 9am. ………………………….. Gabriel Fleming Senior Member I HEREBY CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF THE FAIR TRADING TRIBUNAL. REGISTRAR DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.