The County Court set aside default judgments against the borrower and guarantor, holding that defences of statutory unconscionability under s 12CB of the ASIC Act had real prospects of success. The Court found that the similarities to KS v Prime Capital Securities (No 5) [2026] ACTSC 10 — including the use of a broker who submitted fabricated income information, the lender's apparent failure to verify borrower capacity, substantial fees and default interest provisions, and the lender's own identification documents contradicting the broker's representations — were sufficient to establish an adequate defence on the merits based on an unconscionable system of conduct. The Court also held that where a co-defendant guarantor's statutory unconscionability defence against the same loan remained live, it would be anomalous to deprive the other defendants of the opportunity to run the same case, and this was a powerful factor favouring setting aside the judgments notwithstanding substantial delay and inability to pay costs.
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