La Trobe took a mortgage over a block of land (owned by the borrower company) and a house owned by the guarantor. The guarantor (who owned the borrower company) wanted to develop four units on the land and sell them at a profit. Unfortunately pre-sale of the units fell over and they were ultimately sold at a shortfall by the mortgagee-in-possession. La Trobe then commenced the proceedings seeking possession of the house. The borrower filed a cross-claim arguing La Trobe:
a) acted negligently and in breach of the duty of care it undertook when assessing the pre-sales contracts thereby exposing the borrower to an unreasonable and excessive risk of losing her house;
b) substantially departed from its own lending guidelines and further has departed from normal prudent and appropriate lending practices; and
c) acted unjustly, harshly and unconscionably;
La Trobe successfully argued the cross-claim was not properly pleaded, did not disclose causes of action, and sought relief that might be afforded the borrower not the guarantor and so had them struck out.