Case Note: NSWCA Judgments

On 4 December 2012, the NSWCA delivered 3 important judgments in which it has sought to clarify the law in relation to unconscionable conduct and the application of restitutionary principles. I have included a copy of the headnote for each of the cases and a link to the judgments in case.

Aboody v Ryan [2012] NSWCA 395 (04 December 2012) (Bathurst CJ, Allsop P and Campbell JA) UNCONSCIONABLE CONDUCT - special disadvantage - independence and adequacy of advice - transfer of house from elderly father to daughter - transfer motivated by poor health and irrational political fears - father advised by solicitor obtained by daughter - solicitor explained transaction but did not know of father's irrational motivations - advice neither independent nor adequate - transfer set aside

Citigroup Pty Limited v National Australia Bank Limited [2012] NSWCA 381 (04 December 2012) (Bathurst CJ, Allsop P, Meagher JA, Macfarlan JA and Barrett JA) RESTITUTION - in case of payment made under mistake - change of position defence - receipt by one bank from another and subsequent disbursement by recipient bank - each bank acted without negligence on an instruction subsequently shown to be fraudulent - whether recipient bank acted on the faith of the receipt in making subsequent payment - change of position defence established by recipient bank - basis for and significance of the decision in State Bank of New South Wales Ltd v Swiss Bank Corporation (1995) 39 NSWLR 350 discussed, explained and not followed in one respect - alternative defence of payment over - whether conditions for that defence satisfied - alternative defence of estoppel - whether conditions for that defence satisfied

Hills Industries Ltd v Australian Financial Services and Leasing Pty Ltd; Australian Financial Services and Leasing Pty Ltd v Bosch Security Systems Pty Ltd [2012] NSWCA 380 (04 December 2012) (Bathurst CJ, Allsop P and Meagher JA) RESTITUTION - recovery of money paid under mistake - general principles - defences - change of position - discharge of debt - fraudster concocted false invoices for purchase of equipment - financier paid seller of non-existent goods and entered leaseback arrangement with fraudster - seller applied funds received in discharge of pre-existing debts owed by fraudster's companies - unjust to require restitution