Home Loan Experts v Nassif Isaac [2017] NSWSC 1077

Mortgage originators / brokerage companies can rest assured that their client lists can be safeguarded through restraint of trade clauses after the decision in Dargan Financial Pty Ltd ATF the Dargan Financial Discretionary Trust (trading under “Home Loan Experts”) v Nassif Isaac(1). They must, however, make provision for who owns the client information in their agreement, or risk sharing ownership.  


Home Loan Experts (“HLE”) carry on a business of providing mortgage broking services by originating loans with various credit providers through Connective. Mr Isaac was a sub-originator for HLE pursuant to a Sub-Origination Agreement, under which he was prohibited from using HLE’s confidential information, including client lists and client details, for any other reason other than for the benefit of HLE’s business (2). The Agreement also contained an 18-month post-termination restraint clause which prohibited conduct including soliciting, canvassing, approaching or accepting any approach from any person who was at anytime in the 24 months prior to the termination of the agreement, a client of HLE.

HLE uses Connective to have access to and submit loan applications to credit providers. As a result, HLE’s Connective database (Mercury) contains a list of clients who have submitted loans to HLE with detailed information about those clients. This list is capable of being downloaded and this was done by Mr Isaac.

In November 2016, Mr Isaac terminated his Agreement at a meeting with the director of HLE. At the meeting, Mr Isaac told HLE that he intended to start his own mortgage broking business and it was agreed that Mr Isaac could deal with clients who were his friends and family, or referrals from them, but would refer all other clients back to HLE should he be contacted by them.

Mr Isaac downloaded the client list, and then went to work for another provider of mortgage broking services and proceeded to write loans for several clients of HLE who were neither his friends nor family.

HLE became aware of this conduct and brought proceedings against Mr Isaac, alleging that he had breached the Sub-Origination Agreement and the equitable duty of confidence and seeking an injunction and damages.


Mr Isaac admitted that he had accepted approaches from clients who were not on his list of family and friends but argued that he was entitled to deal with these clients because he was essentially running his own business and that the clients he was dealing with were his clients, not HLE’s.

The Court found that clients under the Agreement could be properly described as clients of Mr Isaac, HLE and whichever Lender provided finance to that client, as the client has ongoing relations with each of these people (3).

Further, it was made clear that once Mr Isaac terminated his Agreement with HLE then the clients he dealt with were no longer his, but belonged solely to HLE and the Lender. The reason for this decision was that Mr Isaac no longer received trail commission after termination, whereas HLE did, and thus only HLE (and the Lender) still had a relation with the client.

Mr Isaac was permanently restrained from disclosing or using any of the contents of the client list and was restrained and was restrained until May 2018 from soliciting, canvassing, approaching or accepting any approach from any previous clients.

What does this mean for brokers?

If you are a broker you should carefully read your agreement when exiting a mortgage brokering company.

For mortgage brokerage companies, protection of your clients is vital to your business. You must make sure that your agreement properly protects your client list and prevents your

The case also highlights the importance of acting quickly when a broker has breached the agreement to prevent churn, clawback and minimise damages. You should therefore seek legal assistance as soon as you realise this conduct has occurred.    

If you need assistance reviewing or re-drafting your agreement, or have had a broker deal with your clients post termination, contact Kate Cooper – kate.c@bransgroves.com.au or (02) 9221 9522. 

If you wish to read the full judgment click here

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