The borrower claimed that the loan was unconscionable because misrepresentations were made in relation to the loan amount. The borrower was arguing that the bank had lent about $500,000 less than it agreed to lend, which meant the borrower could not renovate and lease the property and increase its capital value. The borrower also wanted to adjourn the hearing because of his ill health and so he could serve more evidence.
The Judge refused to adjourn the hearing because:
- There was no evidence that the borrower could pay the bank’s wasted costs;
- There was no indication what extra evidence would be available after the adjournment, or an explanation why it had not been served already;
- The borrowers had already showed a lack of expedition and had defaulted numerous times in serving their evidence;
- The medical evidence the borrower was relying on was not specific and did not adequately explain why the borrower had not been able to engage a lawyer;
- The debt owed to the bank far exceeded the value of the security property and any further delay would prejudice the bank.
On the issue of the unconscionability of the loan the judge found that although there was a request for a second loan of $500,000 to be pre-approved, the bank did not ever represent to the borrower that the additional sum would be lent. The judge found that the evidence of internal bank communications, the letter of offer, diary notes made by the bank’s relationship manager all supported the bank’s position that there were no further agreements to lend additional sums, and that the borrower had never raised the further advance with the bank. The judge also stated that the borrower could not establish that the representations he alleged had been made had actually caused him to enter the loan.
The bank was granted possession of the land and a judgment for the debt owed.