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ARTICLE · 16 MARCH 2007

Financial Services Recovery Update - March 2007

Gadens Lawyers
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Borrowers who took on more debt than they could afford to repay used to obtain little sympathy from the courts. This has now changed.

AustraliaCorporate/Commercial Law

Contents

  • Court Sympathy Causes Recovery Rethink
  • Personally Known To Me

Court Sympathy Causes Recovery Rethink

Borrowers who took on more debt than they could afford to repay used to obtain little sympathy from the courts. This has now changed.

Borrowers who can show that the lender knew, or ought to have known, that their home loan could not be serviced are with increasing frequency obtaining relief under the 'unjust contract' provisions of the Contracts Review Act. This trend heightens the risk of relief also being afforded to borrowers under the equivalent 'unjust contract' provisions of the Consumer Credit Code.

These cases have had some common threads:

  • vulnerable borrowers on fixed income

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