Certane CT Pty Ltd v Whight [2021] QSC 77 [2021] 16 QLR

SUPREME COURT OF QUEENSLAND CITATION: Certane CT Pty Ltd v Whight [2021] QSC 77 PARTIES: CERTANE CT PTY LTD ACN 106 424 088 (FORMERLY KNOWN AS SARGON CT PTY LTD) (Applicant) v ELEANOR MARY WHIGHT (Respondent) FILE NO/S: BS 13546 of 2020 DIVISION: Trial Division PROCEEDING: Application ORIGINATING COURT: Supreme Court at Brisbane DELIVERED ON: 14 April 2021 DELIVERED AT: Brisbane HEARING DATE: 6 April 2021 JUDGE: Jackson J ORDER: The judgment of the court is that: 1. The plaintiff recover possession of the land described as Lot 1 on Registered Plan 174454, Title Reference 16138153 and Lot 6 on Registered Plan 848064, Title Reference 18458238, both situated at 134 Kundes Road, Mount Samson. 2. The defendant pay the plaintiff’s costs of the proceeding, including the application for summary judgment, to be assessed on the indemnity basis. CATCHWORDS: PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SUMMARY JDUGMENT FOR PLAINTIFF OR APPLICANT – FOR DEBT OR LIQUIDATED DAMAGES OR FOR POSSESSION OF LAND – where the applicant plaintiff is registered as mortgagee of land situated at Mount Samson – where the respondent defendant mortgaged the land as security for the debt of Merindah Cattle Company Pty Ltd and personally guaranteed the company’s obligations to the plaintiff – where it was a term of the loan agreement that the principal amount of $783,000 and any other monies owed be paid by 26 March 2020 – where the amounts owing were not paid and the company and the defendant continue to be in -- 1 of 12 -- 2 default – where the notice of intention to defend and defence filed on 22 January 2021 did not comply with the requirements of the pleading rules – where the amended defence filed on 1 April 2021 alleged unconscionable conduct by the plaintiff or its agent in connection with the loan agreement and mortgage – whether the defendant has no real prospect of successfully defending the proceeding – whether the defendant has no real prospect of establishing unconscionable conduct on the facts raised by the amended defence – whether the defendant has no real prospect of successfully defending the proceeding because the defendant will not obtain relief avoiding the loan agreement and mortgage – whether the costs of the proceeding should follow the event. Australian Consumer Law, s 21, s 22, s 237, s 243 Australian Securities and Investments Commission Act 2001 (Cth), s 12CB, s 12CC, s 12GM National Credit Code, s 76 Trade Practices Act 1974 (Cth), s 51AB, s 87 Uniform Civil Procedure Rules 1999 (Qld), r 166, r 292, r 681, r 703 Bolton Properties Pty Ltd v JK Investments (Australia) Pty Ltd [2009] 2 Qd R 202, cited Coldham-Fussell v Commissioner of Taxation (2011) 82 ACSR 439, cited Collier v Morlend Finance Corporation (Victoria) Pty Ltd (1989) 6 BPR 13,337, cited GE Mortgage Solutions Ltd v Fassos [2012] NSWSC 1446, cited Jams 2 Pty Ltd v Stubbings [2020] VSCA 200, cited Langman v Handover (1929) 43 CLR 334, cited Lee v Australian and New Zealand Banking Group Ltd [2013] QCA 284, cited Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494, cited Mayfair Trading Co Pty Ltd v Dreyer (1958) 101 CLR 428, distinguished Palermo v National Australia Bank Ltd [2017] QCA 321, cited PSAL Ltd v Kellas-Sharpe [2012] QSC 031, cited Shannon v Permanent Custodians Ltd [2020] WASCA 198, cited Tonto Home Loans Australia Pty Ltd v Tavares (2011) 15 BPR 29,699, cited Violet Home Loans Pty Ltd v Schmidt (2013) 44 VR 202, cited Wilby v St George Bank Ltd [2001] SASC 388, cited COUNSEL: R Kipps for the Applicant J Nott, Solicitor for the Respondent -- 2 of 12 -- 3 SOLICITORS: Kingston & Partners for the Applicant Jason Nott Solicitors for the Respondent [1] This is an application for summary judgment. The claim is for possession of land described as Lot 1 on Registered Plan 174454, Title Reference 16138153 and Lot 6 on Registered Plan 848064, Title Reference 18458238, both situated at 134 Kundes Road, Mount Samson. [2] The applicant plaintiff is registered as mortgagee of the land. The respondent defendant mortgaged the land as security for the debt of Merindah Cattle Company Pty Ltd ACN 629 157 286 (“the company”) and covenanted with the plaintiff as mortgagee to comply with the terms and conditions referred to in the mortgage. They referred to the standard registered terms in the Queensland Titles Registry document reference 718188316. [3] The standard registered terms provided, inter alia, that in an event of default, defined to include the failure by the debtor to pay any secured money in accordance with the mortgage, the plaintiff, as mortgagee, may take possession of the mortgaged property. [4] On 26 March 2019, the plaintiff advanced the principal sum of $783,000 to the company as borrower. A term of the agreement for loan was that the company was required to pay the principal amount and any other monies owed by 26 March 2020. The company failed to pay the principal and any other monies owing by 26 March 2020 and continues to be in default. [5] The defendant personally guaranteed the company’s obligations to the plaintiff. The defendant did not pay the principal and any other monies owing by 26 March 2020 and continues to be in default. [6] On 17 December 2020, the plaintiff started this proceeding by claim. [7] On 22 January 2021, the defendant filed a notice of intention to defend and defence. The defence did not comply with the requirements of the pleading rules.1 Apart from admitting the plaintiff’s incorporation, that the defendant was the proprietor of the land and the company was incorporated and had the defendant as its sole director, all other allegations in the statement of claim were not admitted, ostensibly on the basis that the defendant was uncertain as to the truth or falsity of those allegations. [8] On 15 March 2021, the plaintiff filed this application for summary judgment returnable on 26 March 2021. As matters transpired, the application was listed for hearing on 6 April 2021. [9] On 1 April 2021, the defendant filed an amended defence. By that pleading, the defendant admitted the loan agreement, that the plaintiff advanced the principal in accordance with the loan agreement, that it was a term of the loan agreement that the company as debtor repay the principal and other monies owed to the plaintiff by 26 March 2020, that it was a term of the loan agreement that the defendant personally guaranteed the company’s obligations to the plaintiff, that it was a term of the loan agreement and mortgage that it was an event of default if the company and the 1 Uniform Civil Procedure Rules 1999 (Qld), r 166(4). -- 3 of 12 -- 4 defendant failed to repay the principal and any other secured monies to the plaintiff by 26 March 2020 and that it was a term of the mortgage that the plaintiff may take possession of the land following an event of default. [10] Further, the defendant admitted that the only payments made by or on behalf of the company and the defendant under the loan agreement and mortgage totalled $19,576, that the company and the defendant had otherwise failed to repay the principal and secured money owing pursuant to the loan agreement by 26 March 2020 and that was an event of default under the mortgage. [11] Lastly, the defendant admitted that it was an express term of the loan agreement and the mortgage that the defendant would be liable for the plaintiff’s costs of enforcement of the mortgage on an indemnity basis. [12] These admissions prove the plaintiff’s claim for relief and would prima facie entitle the plaintiff to summary judgment.2 [13] However, the defendant seeks to set up as a defence, although not expressly pleaded as a counter-claim, an allegation that there was unconscionable conduct of the plaintiff or its agent in connection with the loan agreement and mortgage in contravention of s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) (“the ASIC Act”). The section provides as follows: “12CB Unconscionable conduct in connection with financial services (1) A person must not, in trade or commerce, in connection with: (a) the supply or possible supply of financial services to a person; or (b) the acquisition or possible acquisition of financial services from a person; engage in conduct that is, in all the circumstances, unconscionable. (2) This section does not apply to conduct that is engaged in only because the person engaging in the conduct: (a) institutes legal proceedings in relation to the supply or possible supply, or in relation to the acquisition or possible acquisition; or (b) refers to arbitration a dispute or claim in relation to the supply or possible supply, or in relation to the acquisition or possible acquisition. (3) For the purpose of determining whether a person has contravened subsection (1): (a) the court must not have regard to any circumstances that were not reasonably foreseeable at the time of the alleged contravention; and 2 Uniform Civil Procedure Rules 1999 (Qld), r 292. -- 4 of 12 -- 5 (b) the court may have regard to conduct engaged in, or circumstances existing, before the commencement of this section. (4) It is the intention of the Parliament that: (a) this section is not limited by the unwritten law of the States and Territories relating to unconscionable conduct; and (b) this section is capable of applying to a system of conduct or pattern of behaviour, whether or not a particular individual is identified as having been disadvantaged by the conduct or behaviour; and (c) in considering whether conduct to which a contract relates is unconscionable, a court’s consideration of the contract may include consideration of: (i) the terms of the contract; and (ii) the manner in which and the extent to which the contract is carried out; and is not limited to consideration of the circumstances relating to formation of the contract.” [14] By s 12CB, a person must not, in trade or commerce, in connection with the supply or possible supply of financial services to a person engage in conduct that is, in all the circumstances, unconscionable. The defendant relies on s 12CC of the ASIC Act as setting out matters to which the court may have regard for the purpose of determining whether the plaintiff contravened s 12CB. That section provides, inter alia: “12CC Matters the court may have regard to for the purposes of section 12CB (1) Without limiting the matters to which the court may have regard for the purpose of determining whether a person (the supplier) has contravened section 12CB in connection with the supply or possible supply of financial services to a person (the service recipient), the court may have regard to: (a) the relative strengths of the bargaining positions of the supplier and the service recipient; and (b) whether, as a result of conduct engaged in by the supplier, the service recipient was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the supplier; and (c) whether the service recipient was able to understand any documents relating to the supply or possible supply of the financial services; and -- 5 of 12 -- 6 (d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the service recipient or a person acting on behalf of the service recipient by the supplier or a person acting on behalf of the supplier in relation to the supply or possible supply of the financial services; and (e) the amount for which, and the circumstances under which, the service recipient could have acquired identical or equivalent financial services from a person other than the supplier; and (f) the extent to which the supplier’s conduct towards the service recipient was consistent with the supplier’s conduct in similar transactions between the supplier and other like service recipients; and (g) if the supplier is a corporation—the requirements of any applicable industry code (see subsection (3)); and (h) the requirements of any other industry code (see subsection (3)), if the service recipient acted on the reasonable belief that the supplier would comply with that code; and (i) the extent to which the supplier unreasonably failed to disclose to the service recipient: (i) any intended conduct of the supplier that might affect the interests of the service recipient; and (ii) any risks to the service recipient arising from the supplier’s intended conduct (being risks that the supplier should have foreseen would not be apparent to the service recipient); and (j) if there is a contract between the supplier and the service recipient for the supply of the financial services: (i) the extent to which the supplier was willing to negotiate the terms and conditions of the contract with the service recipient; and (ii) the terms and conditions of the contract; and (iii) the conduct of the supplier and the service recipient in complying with the terms and conditions of the contract; and (iv) any conduct that the supplier or the service recipient engaged in, in connection with their commercial relationship, after they entered into the contract; and (k) without limiting paragraph (j), whether the supplier has a contractual right to vary unilaterally a term or condition -- 6 of 12 -- 7 of a contract between the supplier and the service recipient for the supply of the financial services; and (l) the extent to which the supplier and the service recipient acted in good faith.” [15] These sections have well known comparators in other legislation, starting with s 51AB of the former Trade Practices Act 1974 (Cth) and now reflected in ss 21 and 22 of the Australian Consumer Law. [16] Paragraph 4(g) of the amended defence alleges that, by reason of the matters pleaded in paragraphs 4(c) to 4(f) (constituting the alleged unconscionable conduct), the loan agreement and mortgage between the plaintiff, the company and the defendant are void and unenforceable, not capable of being lawfully enforced by the plaintiff as against the defendant, and the plaintiff is not entitled to the relief claimed. [17] The conduct alleged in paragraphs 4(c) to 4(e) may be summarised as follows: (a) the loan agreement constituted the provision of credit, a credit facility and a financial product within the meaning of the relevant provisions of the ASIC Act and regulations; (b) the procurement of the loan agreement by the plaintiff constituted a dealing in a financial product or the provision of a financial service within the meaning of the relevant provisions of the ASIC Act; (c) prior to the defendant and the company entering into the loan agreement, the plaintiff did not make reasonable enquiries about the company and the defendant’s financial situations or their capacities to repay the mortgage in accordance with the terms of the agreement, (d) the plaintiff failed to properly assess whether the terms of the loan agreement were appropriate or reasonable, in the circumstances; (e) alternatively, if the plaintiff received any advice about the financial situations of the company or the defendant, or the appropriateness of the terms of the loan agreement, they proceeded in disregard of that advice; (f) prior to the plaintiff, the company and the defendant entering into the loan agreement, the plaintiff knew or ought reasonably to have known that the defendant did not have the financial capacity to pay the amounts to become due under the loan agreement and the mortgage in accordance with their terms; (g) despite those matters, the plaintiff procured and proceeded with the execution of the loan agreement and the mortgage. [18] Although not relied upon in paragraph 4(g) of the amended defence specifically, it may be assumed that the defendant also relies on the facts alleged in paragraph 4(b) of the amended defence in relation to the alleged unconscionable conduct. That subparagraph alleges that the defendant is 78 years old, the land is her primary residence, she approached a broker who advertised itself as providing solutions for financially distressed borrowers with bad debts who the plaintiff advised that she did not have the capacity to service a loan until such time as she achieved a realignment of the boundary of the land, and that she was in a situation of financial distress having defaulted on her prior mortgage to the Commonwealth Bank of Australia -- 7 of 12 -- 8 (“Bankwest”), which had appointed receivers who were in possession of the land and was proceeding against her in this court at Brisbane in proceeding number 10287 of 2017. [19] For the purpose of the hearing of this application, it is not in dispute that the defendant did not have the capacity to service the principal on the loan amount by way of interest repayments on an ongoing basis for 12 months. However, that was not the basis on which she applied for or was granted the loan the subject of the loan agreement and the mortgage. [20] On the contrary, the defendant’s application for the loan described its purpose as “refinance and cashout” for a loan amount of $800,000 for six months to refinance the existing loan of $680,000 from Bankwest, which was in arrears, and stated that the funds would be used to pay out the current lender and to provide for interest and fees for up to six months. In other words, on the face of the documents, the purpose of the loan was to create breathing time to enable the defendant to sell the land or part of it to avoid her then current financial distress. [21] On 8 October 2018, the defendant sent an email to the broker stating that Bankwest were asking for $680,000, she owed the local council rates, and needed a little more to cover any loan fees, clean out her dams, do a boundary realignment and sell off the newly rezoned block to a neighbour, which would cost up to $10,000. She requested to borrow somewhere in the vicinity of $780,000 net. [22] On 10 October 2018, she sent an email to the broker asking whether it was possible to have a total of six months’ repayments capitalised onto the loan, so that she could get the boundary realignment done, and the little block would become the vacant land that she planned to sell to her neighbour or another, if he reneged. [23] On 15 October 2018, she sent an email to the broker attaching a rough sketch of the proposed reconfiguration of the two blocks. [24] The defendant submits that the grounds of the amended defence alleging unconscionable conduct create a real prospect of successfully defending the proceeding. [25] One of the defendant’s submissions was that the company was incorporated for the purpose of carrying out a transaction that avoided the provisions of the National Consumer Credit Protection Act 2009 (Cth). Had those provisions applied, there might have been a question whether the loan agreement and mortgage were unjust under s 76 of the National Credit Code.3 The defendant submitted that to structure the transaction to avoid that possibility was a fact relevant to unconscionable conduct under s 12CB of the ASIC Act. She also relied on cases that dealt with unjust contracts within the meaning of the Contracts Review Act 1980 (NSW).4 [26] The plaintiff submitted that no unconscionable conduct could be made out on the facts alleged and that, even if unconscionable conduct were established, no order would be 3 See, for example, Shannon v Permanent Custodians Ltd [2020] WASCA 198, [174]-[188] and [302]- [322]. 4 Teachers’ Health Investments Pty Ltd v Wynne (1996) 2 ACCR 424. -- 8 of 12 -- 9 made avoiding the loan agreement and mortgage, except on terms that the defendant first restore the plaintiff the principal that was advanced. [27] The court’s power to make an order declaring void the whole or any part of the contracts constituted by the loan agreement and mortgage between the defendant as a person who has suffered loss or damage or is likely to do so, and the plaintiff as a person who engaged in unconscionable conduct under s 12CB of the ASIC Act is conferred by s 12GM(2) and (7) of the ASIC Act. Those subsections provide, inter alia: “12GM Other orders (2) Without limiting the generality of section 12GD or 12GNB, the Court may, on the application of: (a) a person who has suffered, or is likely to suffer, loss or damage by conduct of another person that was engaged in in contravention of a provision of this Division; or (b) ASIC in accordance with subsection (3) on behalf of such a person or persons; make such order or orders as the Court thinks appropriate against the person who engaged in the conduct or a person who was involved in the contravention (including all or any of the orders mentioned in subsection (7)) if the Court considers that the order or orders concerned will: (c) compensate the person who made the application, or the person or any of the persons on whose behalf the application was made, in whole or in part for the loss or damage; or (d) prevent or reduce the loss or damage suffered, or likely to be suffered, by such a person or persons. … (7) Without limiting the generality of subsections (1) and (2), the orders referred to in those subsections include the following: (a) an order declaring the whole or any part of a contract made between the person who suffered, or is likely to suffer, the loss or damage and the person who engaged in the conduct or a person who was involved in the contravention constituted by the conduct, or of a collateral arrangement relating to such a contract, to be void and, if the Court thinks fit, to have been void ab initio or at all times on and after a date before the date on which the order is made; …” [28] Those provisions are cognate to similar provisions that operated in respect of unconscionable conduct under s 87 of the former Trade Practices Act 1974 (Cth), now reflected in ss 237 and 243 of the Australian Consumer Law. -- 9 of 12 -- 10 [29] This application turns on the answers to two questions: first, does the defendant have no real prospect of successfully defending the proceeding because there is no real prospect of establishing any unconscionable conduct on the facts raised by the amended defence? Second, even if the plaintiff may have engaged in unconscionable conduct, does the defendant have no real prospect of successfully defending the proceeding because the defendant will not obtain relief avoiding the loan agreement and mortgage? [30] In each case the answer to the question must be answered having regard to the caution exercised by the court before granting summary judgment, but recognising that the “no real prospect” requirement of the current rule5 is not to simply be equated to the standard under prior rules of court.6 [31] From Tonto Home Loans Australia Pty Ltd v Tavares7 onwards, a number of cases have considered the operation of s 12CB or its comparators in relation to unconscionable conduct in connection with the making of a loan and mortgage. Conduct that constitutes taking advantage of vulnerability or lack of understanding, trickery or misleading conduct will potentially engage the section. The relevant matters include those identified in s 12CC. Some of the cases involved high interest rates,8 but that is not the complaint in the present case. [32] The gravamen of the proposed defence in the present case is that although the loan was sought by the defendant on behalf of the company for the purpose of re-financing an existing loan in default for a relatively short period to enable her to repay the borrowing by sale of part of the land, it was asset-based lending that was alleged to be unconscionable, given the defendant’s lack of other means to repay the interest amounts that would accrue during the loan. [33] As to that, the Court of Appeal of the Supreme Court of Victoria said recently that “… the existence of asset-based lending, while a relevant factor in deciding whether a particular loan resulted from unconscionable conduct, is not determinative…”.9 [34] Looking at the amended defence and the evidence to date, in my view, there is no real prospect that the defendant will succeed in establishing unconscionable conduct. It is not said that the defendant did not understand the transaction, its purpose, or that she would have to sell the land or part of it within 12 months to be able to repay the loan. That was, in fact the purpose of the loan as a way out of the default state of the existing loan and mortgage from Bankwest. No trickery or misleading conduct is alleged. It may be accepted that the defendant was vulnerable but there is no real suggestion that the plaintiff took advantage of her. [35] The closest point to that revealed by the evidence was that because of the way that amounts were disbursed on settlement to pay fees, commissions and rates, there was only just over $10,000 cash funds disbursed to the company to enable interest payments to be made over the succeeding 12 months, in addition to the two months 5 Uniform Civil Procedure Rules 1999 (Qld), r 292. 6 Palermo v National Australia Bank Ltd [2017] QCA 321, [69]-[71]; Coldham-Fussell v Commissioner of Taxation (2011) 82 ACSR 439, [98]-[103]; Bolton Properties Pty Ltd v JK Investments (Australia) Pty Ltd [2009] 2 Qd R 202, [2] and [66]-[67]. 7 (2011) 15 BPR 29,699. 8 For example, PSAL Ltd v Kellas-Sharpe [2012] QSC 031. 9 Jams 2 Pty Ltd v Stubbings [2020] VSCA 200, [2]. -- 10 of 12 -- 11 pre-paid interest that was retained by the lender. However, although the result was that the loan went into default after only a few months, the plaintiff did not move to enforce the security10 until after the whole of the 12 month loan period had expired. [36] As well, the defendant took legal advice from an independent solicitor before undertaking the transaction and signed certificates stating that she had done so and understood the terms of the mortgage and the guarantee and her liability under them and the independent solicitor certified to the same effect. [37] In any event, if the plaintiff engaged in unconscionable conduct in contravention of s 12CB in making the guarantee and mortgage with the defendant, to succeed in her defence the defendant must thereby be able to obtain relief avoiding the guarantee and mortgage under s 12GM(7) of the ASIC Act. The defendant does not make an offer of restitution to the plaintiff as a condition of the relief sought by her by repaying the principal advanced under the loan agreement secured by the mortgage and it is not suggested that she has the capacity to do so. [38] Under s 12GM(7), the remedial liability of a contravenor who engages in unconscionable conduct under s 12CB of the ASIC Act is not limited to, but is informed by, the relief available in equity against unconscionable conduct. As was said by Gummow J in the leading case on the scope of provisions such as s 12GM(7), the principles for the grant of equitable relief to rescind and set aside a transaction of loan and mortgage “afford guidance for, but do not dictate”11 relief. That statement is reinforced by the consideration that the power to make an order to avoid a contract under s 12GM(7) is compensatory. The power is not punitive and may not be exercised to deter contravenors generally or the contravenor in question specifically. That limit on the power to avoid a contract follows from the text of s 12GM(7) that the power is to avoid a contract made between the contravenor and “the person who suffered, or is likely to suffer, the loss or damage”. That text refers back to, inter alia, the text of s 12GM(2) whereby the court may, on the application of “a person who has suffered, or is likely to suffer, loss or damage by conduct of” a contravenor, make such order as the court thinks appropriate if (and only if) the court considers the order “will compensate the… person in whole or in part…”. [39] In cases where equitable relief avoiding a loan transaction and securities was sought for breach of the usury laws or the Money Lenders legislation, the party seeking that relief was usually12 required to do equity by making restitution to the lender of the advances made under the loan contract as a condition of the relief avoiding the loan agreement and setting aside the mortgage.13 [40] To permit the defendant to obtain relief avoiding the loan agreement and mortgage without repayment of the principal, that was used mostly to pay out Bankwest and arrears of rates, would not compensate the defendant for being worse off as a result of entering into the loan agreement and mortgage. Instead, it would punish the 10 The plaintiff gave notice under s 84 of the Property Law Act 1974 (Qld) in August 2019 but did not start this proceeding until 17 December 2020. 11 Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494, 535 [116]. 12 There was an exception in cases where the statute prohibited or expressly made the transaction unenforceable, so that the loan and mortgage were subject to the legal doctrine of illegality. In these cases, no relief could be obtained by the money lender and the borrower was not required to do equity to recover the mortgaged property: Mayfair Trading Co Pty Ltd v Dreyer (1958) 101 CLR 428. 13 Langman v Handover (1929) 43 CLR 334; Wilby v St George Bank Ltd [2001] SASC 388, [55]-[87]. -- 11 of 12 -- 12 plaintiff and give her an undue windfall. So far as I can ascertain, none of the cases to date of a cognate kind where a borrower alleges unconscionable conduct has resulted in that form of relief and I do not consider that the defendant has a real prospect of getting such relief.14 [41] In the result, the defendant has not established that she has any real prospect of succeeding in the proposed defence by obtaining relief avoiding the loan agreement and mortgage on the grounds alleged in the defence. First, in my view, the facts relied upon as raising a contravention of s 12CB of the ASIC Act by unconscionable conduct are not sufficient to constitute a real prospect of successfully defending by proving unconscionable conduct at trial. Second, even if the defendant were able to clear that hurdle, the facts and circumstances do not show a real prospect of an order avoiding the loan agreement and mortgage where the company and the defendant have had the full benefit of the advance of the principal and have no capacity to offer restitution to the plaintiff or to repay that sum as a condition of an order for avoidance. [42] As to costs, because the plaintiff has succeeded on the application for summary judgment, it would ordinarily follow that the defendant should be ordered to pay the plaintiff’s costs of the proceeding including the application for summary judgment, on the basis that the costs should follow the event.15 Further, the mortgage provides that the full amount of the plaintiff’s legal fees incurred form part of the secured money. That is a reason to order that the costs of the proceeding should be assessed on the indemnity basis, as a matter of discretion,16 because “the discretion should ordinarily be exercised in a way which corresponds with the mortgagee’s contractual entitlement”.17 14 For example, Jams 2 Pty Ltd v Stubbings [2020] VSCA 200, [48]; Violet Home Loans Pty Ltd v Schmidt (2013) 44 VR 202, [2]; GE Mortgage Solutions Ltd v Fassos [2012] NSWSC 1446, [184]. See also Collier v Morlend Finance Corporation (Victoria) Pty Ltd (1989) 6 BPR 13,337. 15 Uniform Civil Procedure Rules 1999 (Qld), r 681. 16 Uniform Civil Procedure Rules 1999 (Qld), r 703(1). 17 Lee v Australian and New Zealand Banking Group Ltd [2013] QCA 284, [9]. -- 12 of 12 --