JKB Holdings Pty Ltd v de la Vega (No 4) [2012] NSWSC 1177

Supreme Court New South Wales

Medium Neutral Citation: JKB Holdings Pty Ltd v de la Vega (No 4) [2012] NSWSC 1177 Hearing dates: 7 - 8 June; 12 - 15 June; 2 August 2012 Decision date: 07 September 2012 Jurisdiction: Equity Division Before: Rein J Decision: 1. The plaintiff is entitled to interest on the First, Second and Third Loans at 17.5 per cent per annum for the first year and 20 per cent per annum thereafter. 2. The 20 per cent interest clause is not a penalty. 3. The payment of $8000, $75,100 and $54,304 are repayments by the defendants in reduction of the First, Second and Third Loans and the August $52,000 Loan with the repayment to be applied so that the $52,000 loan and interest were repaid by 25 September 2007. 4. Interest should be calculated on an annual basis but accruing daily and repayments should be deducted from interest owing first and then capital. 5. Interest payable to the third defendant on the Small Loans to be calculated pursuant to Practice Note SC Gen 16 and added to the capital. 6. The figures should be calculated to the date that judgment is entered. Catchwords: CONTRACTS - principles - harsh and unconscionable contracts - where loan contract imposes a 2.5 per cent interest rate increase after 12 months - increase not extravagant or unconscionable so as to amount to a penalty

CONTRACTS - loans to which loans monies paid by the defendants should be appropriated

CONTRACTS - general contractual principles - offer and acceptance - where borrower offered certain rate of interest for certain loan amount different from amount ultimately in fact loaned - whether borrower agreed to pay the same rate of interest on the different amount