Lawloan Mortgages v Young [2008] NSWSC 1180

In this case the borrowers (husband and wife) granted a mortgage over land consisting of rural properties. The wife resisted the application for possession on three grounds:

  1. a claim of “injustice” under the Contracts Review Act 1980
  2. unconscionability; and
  3. breach of the requirements of the Farm Debt Mediation Act 1994.

Despite being elderly and her lack of independent income, Rothman J, found that the wife was not inexperienced in legal or commercial transactions and had remarkable grasp of the business and legal issues associated with the various loans. She also had available legal advice. His Honour thus held the contract was not unjust.

To the extent the issue of unconscionability was argued separately from the relief sought under the Contracts Review Act, His Honour held the wife was not under a special disadvantage of which the lender unconscientiously took advantage

The evidence did not show that the wife ever owned cattle (other than the pets) and disclosed that she never operated as a grazier. Thus His Honour held the Farm Debt Mediation Act did not govern the mortgage over the property and ordered possession for the lender.

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