The Commercial Bar Association of Victoria Inc. A0120851O
The distinction in loan contracts between clauses that incentivise prompt payment and clauses which increase the interest rate upon failure of due payment is the basis of the “No Penalty Rule”. A recent decision has applied this rule but has also held that the capitalisation of default interest was unconscionable.
VCAT is bound by an earlier indistinguishable precedent of the Supreme Court, which held that proceedings brought in the Tribunal’s original jurisdiction are not subject to s 5(1) of the Limitation of Actions Act because the tribunal is not a “court of law” within the definition of “action”.
The National Credit Code has been interpreted to apply only to credit obtained for residential property purposes when the loan money is to be used directly by the borrower and not where the borrower’s intention was to pass on the loan funds to be used by another person.
The Corporations Amendment (Corporate Insolvency Reforms) Act 2020 (Cth) has expanded the methods by which documents under Chapter 5 of the Corporations Act 2001 (Cth) can be served, even where the person being served has given no indication that they will accept service electronically.