AMP Bank Ltd v Eckhardt[2018] QDC 92

DISTRICT COURT OF QUEENSLAND

1. [1]
   The defendant has applied for an order setting aside default judgment entered against her on 5 March 2018. She is a self-represented litigant who appeared at the hearing with the assistance of her friend. In the interests of affording natural justice to the defendant, both she and her friend were allowed to make submissions. The plaintiff did not object to this course.

2. [2]
   Before addressing the substance of the defendant’s application to set aside default judgment, it is necessary to identify some factual matters giving rise to the default judgment.

Background facts

3. [3]
   By contract made on or about 7 August 2008 and varied on or about 17 February 2010, the plaintiff loaned the defendant a total of $243,600. The funds were advanced and the defendant gave a registered mortgage over property located at 2/4 Hepburn Court, Oxenford more particularly described as Lot 2 on Group Titles Plan 259, County Ward, Parish Barrow in the State of Queensland (“the land”).

4. [4]
   The standard provisions of the loan agreement^[1]included as follows:

“Part 4:  Default

4.(a)When will you be in default?

(i) Events of Default

You will be in default under the mortgage if:

-any money that you owe us is not paid when it is due to be paid

…

(b)What happens if you default?

If an event of default occurs, we may:

-require that you pay all of the money owing to us immediately

-deal with the property as if we owned it (that includes selling the property in any way we think fit)

-take possession of the property

...

Before we exercise any powers we will give any notice that we are required, by law, to give.”

5. [5]
   When the defendant defaulted under the loan agreement because she failed to make the necessary repayments, the plaintiff issued a default notice on or about 17 December 2015 under section 84 of the Property Law Act 1974 (Qld). By 12 May 2016, the plaintiff sought recovery of possession of the land and repayment of the monies owed and commenced proceedings in the Supreme Court. A notice of intention to defend and defence was filed on 13 June 2016.^[2]

6. [6]
   On or about 16 December 2016, the defendant made a complaint with the Financial Ombudsman Service (“FOS”) that ultimately led to what will be referred to as the “first FOS agreement” which allowed the defendant further time to sell the land to pay out the debt to the plaintiff provided, inter alia, that:

1. (a)
   the defendant withdrew her defence;

2. (b)
   by 30 April 2017, the defendant provide the plaintiff with a copy of an unconditional contract of sale for the land which must be on terms acceptable to the plaintiff;

3. (c)
   if the plaintiff is provided with an unconditional contract of sale by 30 April 2017, the defendant had an additional 42 days from the date the contract is executed for the settlement of the sale to take place;

4. (d)
   if the defendant failed to comply with those conditions, the plaintiff would send her a notice giving her seven days to rectify the breach; and

5. (e)
   if the defendant failed to comply with the said notice, she agreed to hand over vacant possession of the property immediately and the plaintiff would immediately proceed with the court proceeding including the entry of default judgment and with the defendant agreeing not to take any step that would interfere with or delay the entry of default judgment and the enforcement of the default judgment.^[3]

7. [7]
   There is a dispute between the parties as to whether the first FOS agreement was complied with. The defendant’s position is that she provided a contract of sale to sell the land within the time specified.^[4]The plaintiff contends that the defendant failed to provide a copy of a contract of sale for the land.^[5]In any event, the terms required the defendant to provide the plaintiff with a copy of an unconditional contract of sale for the land which must be on terms acceptableto the plaintiff. The terms were clearly not acceptable to the plaintiff.

8. [8]
   The plaintiff obtained default judgment in the Supreme Court on 31 May 2017. However, on 30 November 2017, the parties agreed to set aside that default judgment and to transfer the proceedings to the District Court.

9. [9]
   One day prior to then (on 29 November 2017) and following another FOS dispute lodged by the defendant, the parties reached a further agreement (“the second FOS agreement”). By that agreement, the defendant was required to do a number of things within a certain period of time.^[6]Relevantly the defendant was required to provide the plaintiff:

1. (a)
   by 13 December 2017 with:

1. (i)
   an email stating acceptance of the agreement;

2. (ii)
   a copy of the current statement of rates from council;

3. (iii)
   a copy of any arrangement with the council regarding the outstanding council rates (such as a letter confirming stay action in lieu of the property selling, etc);

4. (iv)
   a copy of the current building insurance policy for the security property located at the land,

2. (b)
   by 31 December 2017 with an unconditional contract of sale for the security property located at the land;

3. (c)
   by 14 February 2018 with a complete discharge authority; and

4. (d)
   by 21 February 2018 with a settlement statement.

10. [10]
    In addition, it was noted as part of the second FOS agreement that if the defendant failed to meet any of the terms of that agreement, the plaintiff would provide the defendant with written notice that if the defendant did not remedy the breach within the seven day notice period, the plaintiff was entitled to commence recovery action for the full amount of the outstanding debt.

11. [11]
    The defendant did not supply any of the documents referred to by the requisite time.^[7]

12. [12]
    Accordingly, on 19 December 2017, an email was sent to the defendant giving seven days to rectify the breaches.^[8]

13. [13]
    After the seven day notice period, on 3 January 2018, the defendant provided the plaintiff with a copy of a rates notice from the Gold Coast City Council; a copy of a home insurance statement providing insurance cover issued by Woolworths; and a further contract of sale of the secured property (with a sale price of $150,000).^[9]The further contract of sale, with the buyer providing a $10 deposit, did not have a settlement date.

14. [14]
    On 22 February 2018, the plaintiff’s solicitors gave notice to the defendant that she had seven days to rectify the earlier breach concerning the first FOS agreement and stated “we reserve our client’s rights to apply to the District Court for the entry of default judgment”.^[10]

15. [15]
    On 27 February 2018, the defendant thanked the plaintiff’s solicitors for their letter but did not provide any further unconditional contract of sale.^[11]

16. [16]
    As such, the plaintiff obtained default judgment on 5 March 2018, the right to recover possession of the land and for the defendant to pay the plaintiff the amount of $255,946.51.

17. [17]
    The judgment debt remains due and unpaid.^[12]

18. [18]
    The plaintiff deposed that the defendant continues to be in default of the mortgage and loan contract with the last payment being made by the defendant on 14 December 2015 for the amount of $126.57.^[13]

Rule 290 of the Uniform Civil Procedure Rules 1999 (Qld)

19. [19]
    The court, pursuant to rule 290 of the Uniform Civil Procedure Rules 1999 (Qld), can set aside a judgment by default, on terms, including terms about costs and the giving of security, that the court considers appropriate. The decision whether or not to set aside judgment is discretionary.^[14]

20. [20]
    It is common ground between the parties that the defendant must show the following matters:

1. (a)
   a satisfactory explanation for a failure to appear;

2. (b)
   an explanation for any delay in making the application; and

3. (c)
   that the defendant has a prima facie defence on the merits to the claim on which the judgment is founded.

21. [21]
    In National Mutual Life Association of Australasia Ltd v Oasis Developments Pty Ltd [1983] 2 Qd R 441 at 449-50, McPherson J held:

“Speaking generally it may be said that it is the last of these considerations that is the most cogent. It is not often that a defendant who has an apparently good ground of defence would be refused the opportunity of defending, even though a lengthy interval of time had elapsed provided that no irreparable prejudice is thereby done to the plaintiff”.

22. [22]
    In DCT v Johnston[2006] QSC 061 at [4], Atkinson J stated:

“…the defendant must demonstrate ‘a very compelling reason’ for the failure to appear and that it has a plausible defence either in law or in fact. Before allowing a defendant to come in and defend, the court should have before it material which enables it to say how it came about that the defendant found itself bound by a regularly entered judgement; that the defendant genuinely desires to be allowed to come in and present its case; and that issues are raised in such a form as to require serious consideration of the defence put forward. The affidavit material in support of an application is set aside judgement entered into in default appearance must set out all the defences in which the defendant intends to rely and briefly set out the facts by which the defendant seeks to establish such defences. A mere statement by the defendant that he or she has a good defence is not sufficient…”

23. [23]
    I will deal with each of the factors necessary to set aside default judgment in this instance.

Satisfactory explanation for a failure to appear

24. [24]
    The plaintiff obtained default judgment on 5 March 2018 after putting the defendant on notice, about two weeks prior, that it reserved its rights to seek default judgment. This notice was given on 22 February 2018. The notice referred to the two FOS disputes.^[15]

25. [25]
    As identified earlier in these reasons, the defendant lodged two disputes with FOS; each resulting in agreements between the parties conditional upon the defendant taking steps to avoid the plaintiff exercising its lawful entitlements pursuant to the loan agreement.^[16]I consider the defendant did not comply with her obligations under the FOS agreements. For instance in accordance with the first FOS agreement the defendant did not, by 30 April 2017, provide the plaintiff with a copy of an unconditional contract of sale for the land, which were on terms acceptable to the plaintiff. Regarding the second FOS agreement, the defendant did not supply any of the documents sought by the stipulated time, being 13 December 2017.

26. [26]
    Following the defendant’s non-compliance with the second FOS agreement on 19 December 2017, the plaintiff requested the defendant remedy her breach within seven days.^[17]This meant that the plaintiff was entitled to commence recovery action for the full amount of the outstanding debt in the event the defendant did not remedy the breach within the seven day notice period.^[18]The response given by the defendant via email dated 3 January 2018 was insufficient because she did not provide a letter confirming an agreement and arrangement in place with respect to the arrears in rates owed to the Gold Coast City Council. As such, despite what the defendant asserted at the hearing of this application, it did not prevent the plaintiff from commencing recovery action.

27. [27]
    On 8 January 2018, the plaintiff emailed the defendant advising as follows:

“Thanks for the information provided. AMP believes the proposed sale price of $150,000 may be under the market value of the property and we will need to conduct a formal valuation.

I will arrange to provide our Valuer with your name, email and telephone number. Can you please provide access for this purpose.

In relation to the [second] FOS agreement, you have provided a rates notice but failed to provide confirmation from Council that there is an arrangement in place, or they are willing to defer recovery action in lieu of the sale.”^[19]

28. [28]
    The plaintiff has indicated that at the time of sending the email, it did not intend to abandon reliance on the fact that the rates and insurance information were late. Its immediate concern was the failure of the defendant to address the third requirement of the (second) FOS dispute, and also the sale price of $150,000 for the secured property (and a $10 deposit). The contract of sale for $150,000 was not only less than the earlier contract of sale for $330,000, but was also far less than the initial valuation for the secured property of $270,000 which the plaintiff obtained in July 2008.^[20]

29. [29]
    The defendant accepts that she was late in submitting the relevant documentation concerning the second FOS agreement and states that the plaintiff “did not raise any objection that I supplied them late, and did not provide them prior to the 13.12.17, on which the plaintiff obtained default judgement against me, 5 March 2018”.^[21]She “had reasonably expected to be kept informed by the plaintiff in relation to the valuation, and not ambushed with a default judgment, as [she has] been in this instance”.^[22]However I consider the terms of the second FOS agreement made it clear what was required of the defendant and that in the event she was in breach and did not remedy the breach within the seven day notice period, then the plaintiff was entitled to commence recovery action for the full amount of the outstanding debt.^[23]No further notice was required.    

30. [30]
    The defendant lodged yet another dispute with FOS, but on 16 January 2018 she was advised by FOS that it could not consider her dispute about the plaintiff because “it [was] lacking in substance” and that “FOS does not accept [the defendant’s] promissory notes have the effect of discharging [her] mortgage with [the plaintiff]”.^[24]

31. [31]
    I find there was nothing preventing the defendant from filing a notice of intention to defend and defence on receipt of the plaintiff’s breach notice given on 22 February 2018. Instead when she received the breach notice on 22 February 2018, the defendant responded to the letter from the solicitors for the plaintiff identifying, among other things, that she “actually discharged the alleged liability and you are in default for not even showing up for settlement”.^[25]The letter also makes a number of allegations against the plaintiff and states:

“So please do not suggest that we are holding up or in breach of ANYTHING. AMP is in Breach at least THREE TIMES and keep threatening us. WHY?

…

We have GIVEN IN TO HELP YOU ENOUGH, but your actions or lack of actions just keeps on killing our business offers and agreements with you. Yet you make threats to us??? WHATS THAT ALL ABOUT?

We have had enough, this is not business its abuse.

PLEASE NO MORE THREATS, when you are holding back the progress and we have been willing to go WAY BEYOND the necessary reasoning to assist AMP and your legal team”.

32. [32]
    If the defendant was content to rely upon her assertion that she “actually discharged the alleged liability and [the plaintiff was] in default for not even showing up for settlement”, then she ought to have filed her notice of intention to defend and defence instead of responding to the correspondence from the solicitors for the plaintiff on 22 February 2018 in the manner she did.

33. [33]
    The defendant contends that the plaintiff obtained default judgement “in bad faith without notice to me that they were doing so”. In rejecting that submission in light of the above matters, I am not persuaded that there has been a satisfactory explanation for the defendant’s failure to file a notice of intention to defend and defence.

An explanation for any delay in making the application

34. [34]
    The plaintiff does not contend there was a delay in making this application to set aside default judgement.

Prima facie defence on the merits

35. [35]
    At the hearing of this application, the defendant was granted leave to rely upon a proposed defence in respect to the action. The defendant pleads the following matters:

“1.  All paragraphs of the Statement of Claim – Not in a position to deny or admit – I request further and better particulars including a copy of the statement of claim which has been mislaid. The Defendant reserves the right to amend this Defence when further and better particulars are provided.

2. I deny the claim entirely which has been discharged by a Bill of Exchange. The Plaintiff did not attend the redemption appointment to settle the discharge of their mortgage.

…

4. The Defendant had a bona fide contract of sale but as the Plaintiff/Respondent did not grant the Defendant clear title at settlement by providing a discharge or release of mortgage, the Defendant’s sale was frustrated and the Defendant lost the buyer and the sale.

5. I have given the Plaintiff a Notice to Admit Facts as Annexure “JDE-B” to my Affidavit sworn 15 December 2017…

6. The Defendant in its negotiations with the Plaintiff/Respondent agreed to provide another contract of sale. Having done so, the contract of sale was provided to the Plaintiff/Respondent which was also frustrated when the Valuation which was arranged by Mr Todd Field either did not occur, or no advice to the valuation outcome was notified to the defendant… to allow the sale to complete.

7. …The Defendant believes [because the plaintiff neither arranged nor notified the defendant that it did not proceed with the valuation regarding the sale price of $150,000] to be misleading and deceptive conduct in trade or commerce, on the part of the Plaintiff, pursuant to the provisions of the Trade Practices Act. The Defendant believes the Court should not allow the default judgement to stand in those circumstances.

8. The Defendant has offered to attempt to resurrect the second sale contract but the Plaintiff has not indicated or advised they will consider it.

9. The Defendant relies on the Notice to Admit Facts referred to in Par. 5 above.”

36. [36]
    During the hearing of the application, these matters were reduced to five key points being:

1. (a)
   the bill of exchange/promissory note;

2. (b)
   the contracts of sale over the land;

3. (c)
   the FOS dealings;

4. (d)
   claims of misleading, deceptive and/or unconscionable conduct; and

5. (e)
   the Notice to Admit Documents.

Bill of Exchange/Promissory Note

37. [37]
    The defendant relies on a promissory note/money order/bill of exchange served on the plaintiff on 20 September 2017.^[26]The defendant asserts that because the plaintiff has not returned the promissory note, it has accepted it.  

38. [38]
    The ‘promissory note’ is headed:

“PROMISSORY NOTE  PROMISSORY NOTE  PROMISSORY NOTE

DESTRUCTION, MUTILATION OR SURRENDER TO MAKER DISCHARGES LIABILIY HEREIN”.

39. [39]
    The ‘maker’ of the document nominates the defendant is to pay “ANZ Bank Ltd (sic) ACN 0815 960 009”. The amount specified was the sum $259,401.52 “Australian only”. The note was given the number “PNJDE290920171105”. It was “redeemable at:

“502 Hope Island Road

Helensvale Queensland 4212

At 11:05 hours without; let, delay, hindrance or ado, on

The Twenty Ninth day of September, AD 2017”.

40. [40]
    Across the bottom of the promissory note was as follows:

“Memo: Issued pursuant to P.L.73-10 (see H.J.R.192 dated June 5, 1933) and/or its Australian equivalent, The Financial Emergencies Acts”.

41. [41]
    Immediately upon receipt of this document, the solicitors for the plaintiff notified the defendant rejecting the purported payment under the promissory note.^[27]That is not unsurprising when one considers the content of the document and the decision of Australia and New Zealand Banking Group Ltd v Evans [2016] NSWSC 1742. It was submitted on behalf of the defendant that the decision in Evans, “was of no effect whatsoever”. I respectfully disagree. In that case, Garling J was required to consider a remarkably similar document such as the present one before this court. In that case, the defendant asserted that the promissory notes, having been accepted by ANZ, constituted full and final satisfaction of its claimed liabilities. Like the defendant in the present instance, the defendant in Evans relied upon a statement by Lord Denning MR in Fielding and Platt Ltd v Najjar [1969] 2 All ER 150 at 152:

“Stopping there, it is quite plain to me that the defendant was liable to pay the first of the promissory notes. We have repeatedly said in this court that a bill of exchange or a promissory note is to be treated as cash. It is to be honoured unless there is some good reason to the contrary. It is suggested that on the first note, there was a failure of consideration. That suggestion is quite unfounded. The plaintiffs were getting on with their part of the contract. They were, they say, ordering goods from their suppliers and getting on with the work. At any rate, there is no evidence to the contrary: and unless they were themselves in default, they were clearly entitled to payment of the first note”.

42. [42]
    The plaintiff in the present instance submits the document (if not a sham^[28]) does not discharge the debt. It submits that if the document has any effect at all, it was a mere voluntary promise by the defendant to pay the debt due to the plaintiff and did not constitute payment. I accept this submission. As Garling J in Evans stated at [50]:

“It is illogical and incorrect as a matter of legal principle to take the statement that a promissory note “is to be treated as cash” out of context in which it appeared, and apply it, as Mr Evans seeks to do here, in circumstances where Mr Evans creates a promissory note, which is not drawn from any reputable or substantial financial institution, and which is not a recognised form of payment under the loan documentation, and then proffers it entirely voluntarily in circumstances where the ANZ is required to attend at a remote rural village, at a specific time, in order to collect payment. Mr Evans’ assertion that, in those circumstances, he is excused from repaying his substantial liability to ANZ is, simply put, a nonsense”.

43. [43]
    I consider there is no merit whatsoever in the defendant’s argument concerning the effect of the promissory note. The defendant’s document does not discharge the debt. Indeed FOS formed a similar view when the defendant sought to agitate a third dispute in January 2018. The defendant’s document is not drawn from any reputable or substantial financial institution and is not a recognised form of payment under the loan documentation. Accordingly I am not persuaded the defendant has demonstrated a prima facie defence on the merits to the claim regarding the effect of the bill of exchange/promissory note.

Contracts of Sale

44. [44]
    There were two purported contracts of sale. The defendant claims in the proposed defence that she:

“had a bona fide contract of sale but as the Plaintiff/Respondent did not grant the Defendant clear title at settlement by providing a discharge or release of mortgage, the Defendant’s sale was frustrated and the Defendant lost the buyer and the sale”.

45. [45]
    According to the plaintiff, as at 18 October 2017, no contract was provided.^[29]The plaintiff’s solicitor was first given a copy of the contract of sale at a previous interlocutory hearing on 19 October 2017.^[30]

46. [46]
    The date of the first contract of sale was 9 March 2017 with the buyer identified as “K.K. Developments P/L and/or Nominee”. Both the buyer and seller were acting without solicitors. The contract price was for an amount of $330,000, with a deposit of $1. Settlement date was proposed for 60 days.^[31]

47. [47]
    It is unclear from the defendant’s material as to when the plaintiff was notified of this sale. As indicated the plaintiff deposed that as at 18 October 2017, no contract was provided.^[32]The contract was revealed after the first FOS agreement but before the second FOS agreement. Notably pursuant to the first FOS agreement, the plaintiff agreed to stay its action in order to allow the defendant further time to sell the land in order to pay out the debt to AMP provided that, among other matters, by 30 April 2017, the defendant provide the plaintiff with a copy of the unconditional contract of sale for the land which must be on terms acceptable to the plaintiff. It was also agreed that if the plaintiff was provided with an unconditional contract of sale, the defendant had an additional 42 days from the date the contract was executed for the settlement of the sale to take place. If the defendant failed to comply with any of the relevant conditions, the plaintiff was required to send her a notice giving her seven days to rectify the breach. The defendant agreed that should she fail to comply with the said notice, she was required to hand over vacant possession of the property immediately and permit AMP to proceed with the court proceeding including the entry of default judgment.

48. [48]
    On the material before me, I am not satisfied the defendant provided a copy of an unconditional contract of sale for the land by 30 April 2017 on terms acceptable to the plaintiff.^[33]

49. [49]
    A second contract of sale was entered into on Christmas Eve 2017. On this occasion it was for a significantly lesser amount of $150,000 with a deposit of $10. The contract did not have a date for settlement and the buyer on this occasion was “K.K. Developments Pty Ltd”.^[34]Curiously a historical company search for this company reveals the buyer is now the subject of a strike off application by the Australian Securities and Investments Commission.^[35]

50. [50]
    The contract needs to be considered in the context of the second FOS agreement requiring the defendant agreeing to perform a number of steps within a specified timeframe in order to avoid the plaintiff taking steps to obtain possession of the land. The defendant did not comply within the relevant time.^[36]The plaintiff issued a breach notice to the defendant on 19 December 2017, requiring her to provide the relevant documentation within seven days. Such information was not forthcoming. When the information arrived the plaintiff did not intend to abandon reliance upon the fact that the defendant had not complied with the provision of relevant information. The plaintiff’s immediate concern was the failure of the defendant to address the FOS dispute and also the sale price of $150,000 in context where it was significantly less than the earlier contract of $330,000 but also far less than the initial valuation of the security property of $270,000 which the plaintiff obtained in July 2017. I can understand why the plaintiff did not engage a valuer to inspect the land despite providing an indication that a valuer would be forthcoming. However, the plaintiff’s view was that in light of the ongoing breaches by the defendant (including no repayments since December 2015) and also the fact that the contract of sale was $150,000 (being considerably than the value of the security), it subsequently changed its mind and decided, sensibly, not to obtain a valuation.^[37]

51. [51]
    It is common ground that no new contract of sale has been proffered since 3 January 2018.^[38]

52. [52]
    I am not persuaded by the defendant’s arguments that the contract(s) of sale are sufficient to raise a prima facie defence on the merits to the claim on which default judgment is founded.

FOS dealings

53. [53]
    I have concluded, for the reasons identified earlier, that the defendant was in breach of the FOS agreements.^[39]As such, I do not accept the defendant’s contention that the plaintiff was in breach of its obligations pursuant to either agreement.

Claims of misleading, deceptive and/or unconscionable conduct

54. [54]
    The defendant claims misleading and deceptive conduct on the part of the plaintiff in circumstances where it is asserted that the plaintiff would not enter default judgment without first sending a valuer to value the property. Reference is made to an email by the plaintiff on 8 January 2018.^[40]The defendant awaited the visit of the valuer and had photographs ready as well as a list of repairs (said to adversely effect the value of the property). No visit from the valuer took place and “the next thing that occurred, the plaintiff advised it had obtained default judgment again”.^[41]The defendant relies upon section 51 of the now replaced Trade Practices Act 1974 (Cth).

55. [55]
    The plaintiff raises four arguments in response. The first is that even if the conduct is made out, it does not entitle the plaintiff to an order setting aside the mortgage and loan agreements under section 12GM of the Australian Securities and Investments Commission Act 2001(Cth) (“ASIC Act”) or sections 237 and 243 of the Australian Consumer Law (which is Schedule 2 to the Competition and Consumer Act 2010(Cth) (“ACL”)) because the alleged representation was made after entry into the mortgage and loan agreements and did not induce entry into them. Having regard to the wording of the provisions of the ASIC Act and the ACL, I accept that submission.

56. [56]
    The second ground to defeat the defendant’s claim, which I accept, is that any money claim which the defendant professes to have is not a defence to the rights the plaintiff has asserted under the mortgage, but could only be pursued as a separate action. Further I note clause 7(c) of the loan agreement provides:

“You must pay all money that you owe us in full. You must not deduct anything from any payment. In particular, you must not deduct anything that you claim that we owe, or could in the future owe.”^[42]

57. [57]
    Thirdly, the actions of the plaintiff indicating the prospect of a valuer to attend the property was “merely a statement of intention to do something in the future” but “which did not eventuate and which is not per se misleading or deceptive”.^[43]The plaintiff referred to the decision of Bill Acceptance Corp Ltd v GWA Limited (1983) 50 ALR 242, that the mere fact that representation as to future conduct or events do not come to pass does not make them misleading or deceptive notwithstanding that the applicant has relied on them and has altered his/her position on the faith of them.

58. [58]
    I also accept the fourth ground raised on behalf of the plaintiff that there is no entitlement to relief because there is no loss. There was no detrimental reliance by reason of the alleged representation. The defendant is unable to point to any prejudice sustained by her that would not have been sustained if the representation had not been made.^[44]Comparing the defendant’s position now with the position that she would have been in if the representation had not been made, I am unable to detect any loss. Indeed, the plaintiff submits that if the representation had not been made, then the plaintiff would have moved anyway (perhaps earlier) to enter default judgment.

59. [59]
    Furthermore, I do not accept the proposition that there is some unconscionable conduct on the part of the plaintiff. There is no suggestion the defendant was coerced into entering into the agreement with the plaintiff. Both the defendant and plaintiff were in an equal bargaining position when they entered into the mortgage. Even if the defendant was in an unequal bargaining position at the time she was in default, disparity of bargaining position is not of itself enough.^[45]The defendant was not required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the supplier.^[46]The defendant does not contend that she was unable to understand any documents relating to financial services.^[47]No undue influence or pressure was exerted on, nor were any unfair tactics used against the defendant.^[48]The plaintiff’s competitors would exercise the same rights against other borrowers who are in default, and the plaintiff would exercise the same rights against its’ other customers who were in default.^[49]The plaintiff disclosed its intended conduct, namely the entry of default judgment.^[50]There is no bad faith on the part of the plaintiff.^[51]Mere hardship or unfairness is not enough to amount to unconscionable conduct within section 12CB of the ASIC Actand/or section 21 of the ACL.^[52]

60. [60]
    In the circumstances, I am unable to accept the defendant’s claims of misleading, deceptive or unconscionable conduct.

Notices to Admit

61. [61]
    The defendant served a notice to admit facts on or about 13 October 2017. This was at a time when the proceedings had, as at the time of service of the notice, been brought to an end by default judgment which was entered on 31 May 2017. The default judgment was still subsisting as at 13 October 2017 as the defendant had not applied to set aside judgment. The judgment was eventually set aside by consent on 30 November 2017 following an application by the defendant for a stay of execution of the judgment. Accordingly, given there was a judgment in place on 13 October 2017, there was no action on foot and thus no “proceeding” in which the notice to admit could effectually operate.

Conclusion and orders

62. [62]
    In the circumstances, I am not persuaded that the default judgment should be set aside. Accordingly, the application is dismissed. Subject to any further written submissions within 14 days dealing specifically about costs, the defendant is to pay the plaintiff’s costs of, and incidental to, the application (including any reserved costs) to be agreed or otherwise assessed.