IN THE COUNTY COURT OF VICTORIA
AT Melbourne
COMMERCIAL DIVISION	Revised
Not Restricted
Suitable for Publication	
BANKING AND FINANCE LIST 	

 Case No. CI-20-02612

MCL 102 PTY LTD (ACN 638 966 800)	Plaintiff	
		
v		
		
THEODORA YUEN	Defendant	

and	

SCOTT CASEY
	
Third Party 	
		
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JUDGE:	HIS HONOUR JUDGE COSGRAVE	
WHERE HELD:	Melbourne	
DATE OF HEARING:	Determined on the papers (submissions filed 15 June 2022)	
DATE OF JUDGMENT:	24 June 2022	
CASE MAY BE CITED AS:	MCL 102 Pty Ltd v Yuen & Anor (No 3)	
MEDIUM NEUTRAL CITATION:	[2022] VCC 937		

REASONS FOR JUDGMENT (No 3)
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Subject:	DAMAGES – COMPENSATION
Catchwords: 	Damages – compensation – recovery of debt – third party claim – enforcement of judgment 
Legislation Cited:	Australian Securities and Investments Commission Act 2001 (Cth), Corporations Act 2001 (Cth); Competition and Consumer Act 2010 (Cth); County Court Civil Procedure Rules 2018 (Vic)
Cases Cited:	Lockyer v Birmingham (No 3) [2018] WASC 61	

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APPEARANCES:
	Counsel	Solicitors	
For the Plaintiff	Mr C. Salpigtidis	Summer Lawyers	
			
For the Defendant	Mr G.J. Moloney	Self-represented 	

For the Third Party	
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No appearance	

HIS HONOUR:

Introduction
1	On 28 April 2022, I gave reasons for judgment (“the principal reasons”) in favour of the plaintiff (“MCL”) against the defendant (“Yuen”).  On 11 May 2022, I made orders that:
1.	the defendant pay the plaintiff the sum of $275,000 together with interest until the date of judgment in the sum of $207,761.72;
2.	the plaintiff recover from the defendant possession of the land situated at and known as Unit 302, 632 Doncaster Road, Doncaster in the State of Victoria, being the whole of the land more particularly described in Certificate of Title Volume 11392 Folio 236;
3.	the defendant pay the plaintiff’s costs of and incidental to the proceeding, including any reserved costs, such costs to be taxed on an indemnity basis in default of agreement.
2	In the proceeding, Yuen made a third party claim against Scott Casey (“Casey”).  On 7 June 2022, I delivered reasons for judgment on Yuen’s third party notice. I found that Yuen was entitled to judgment against Casey for damages or compensation and that she was entitled to enforce that judgment upon the final orders being made.
3	The Court requested further submissions on the question of the amount of damages which Yuen should receive. This judgment addresses that claim.  It assumes familiarity with the two previous judgments in this matter and uses the same terminology.  

Analysis
4	Under section 12GF(1) of the Australian Securities and Investments Commission Act 2001 (Cth) (“ASIC Act”), where there have been findings of misleading and deceptive conduct in contravention of section 12DA and that conduct has caused loss and damage, the person who has suffered that loss and damage may recover “the amount of the loss and damage” from the person found to have contravened the section.  
5	It is well accepted on the authorities that the legal principles regarding misleading and deceptive conduct under the Australian Consumer Law and the Corporations Act 2001 (Cth) are equally applicable with respect to cases under section 12GF of the ASIC Act.  
6	As set out in my earlier judgment, I am satisfied that Yuen relied upon what Casey told her and that a significant part of the loss and damage she has suffered in this case resulted from his conduct which was in contravention of the ASIC Act.  
7	In her submissions, Yuen referred to the measure of damages applicable under section 12GF of the ASIC Act as recently considered by the Supreme Court of Western Australia in Lockyer v Birmingham (No 3).  In that case, a financial adviser was found to have engaged in misleading and deceptive conduct in connection with the plaintiff’s taxation and financial affairs.  The court observed that:
“An award of damages under s 12GF of the ASIC Act is compensatory.  The object of the award is to restore a plaintiff to the position it would have been in if the infringing conduct had not taken place.  Thus the assessment of damages for misleading or deceptive conduct usually involves a comparison between the position in which the person who suffered the loss or damage is in and the position the person would have been in had there been no contravening conduct. Often the assessment process will involve determining whether the person who had been misled would have entered into a transaction other than the one actually entered in reliance on the contravening conduct and a determination of whether the person has suffered a loss as a result.”
8	The court also observed that the assessment of damages under section 12GF of the ASIC Act is not limited by common law principles.  The assessment is to be approached flexibly, the aim being to give the injured claimant an amount which most fairly compensates for the wrong suffered.
9	In the present case, Yuen believed, on the basis of what she was told by Casey, that he had arranged for her to obtain a loan from the Bendigo Bank at the bank’s usual rates of lending for such loans and not at the significantly higher rate charged by the plaintiff.  Yuen only entered into the transaction with the plaintiff because she believed it was a short-term loan designed to maintain her position until the Bendigo Bank loan was finalised.
10	In my previous judgment, I noted that Yuen was under pressure from the ANZ in connection with the loan she had from that bank.  She acknowledged that the bank wanted its money and that was causing her to panic.  Given the loss of her business, her minimal income and her financial difficulties at the time, I concluded that, in order to repay the ANZ, Yuen would have to sell the property.  This is important because the Court needs to take into account Yuen’s debt position at the time.  Casey can be liable to Yuen only to the degree to which he caused her financial position to materially worsen.  
11	There was no expert valuation evidence at trial regarding the value of the property in June 2019 when Yuen took out the mortgage with the plaintiff.  In the loan application to the plaintiff, Casey estimated the value of the property at $600,000.  However, the property was valued around 26 June 2019 and as a result of that valuation, the amount of the proposed borrowing from MA SOF was reduced from $330,000 to $275,000.  The evidence at trial suggested that the valuation provided to MA SOF “didn’t stack up”.  The reduction in loan principal was approximately 17 per cent.  The plaintiff’s closing submissions state that the loan to valuation ratio in respect of the loan to Friseur was 55 per cent.  This implies a value of the property at 26 June 2019 at $500,000.
12	On that basis, it could be inferred that had the property been sold around 26 June 2019, it would have realised approximately $500,000.  The ANZ Bank would have retained approximately $128,500 in addition to some extra funds to reflect the costs of sale.  Assuming the above to be correct, the ANZ would have returned to Yuen a balance of approximately $365,000.  Apart from this amount, Yuen also would not have incurred the interest costs imposed upon her by MCL under the mortgage.  These amount to approximately $207,760.
13	Accordingly, the award of damages in favour of Yuen against Casey should be $572,760 comprising $365,000 together with an amount equal to the interest awarded to the plaintiff of $207,760.
14	Yuen also contended that she was entitled to compensation for the loss of use of the $365,000 from August 2019 to 11 May 2022.  It was submitted that the loss might be based on the average fixed deposit rate given by the major banks over that period.  According to the Retail and Deposit Investment Data published by the Reserve Bank, the average deposit interest rate over that 32 month period was 0.714 per cent.  Applied to the principal sum of $365,000, that would yield an additional amount of approximately $2,606.10.  
Conclusion 
15	For the reasons set out above, I order that:
1.	there be judgment for the defendant on the third party notice;
2.	the third party pay the defendant damages in the sum of $572,760 together with further damages in the amount of $2,606.10 for the loss of use of the sum of $365,000;
3.	the third party pay the defendant damages in the amount of the costs awarded to the plaintiff against the defendant in paragraph 3 of the orders made on 11 May 2022;
4.	the third party pay the defendant’s costs of the third party proceeding fixed in the sum of $4,400;
5.	pursuant to rule 11.11(1)(b)(ii) of the County Court Civil Procedure Rules 2018 (Vic) (“the Rules”) the defendant have leave to obtain the damages awarded in paragraphs 2,3, and 4 of these orders against the third party;
6.	pursuant to rule 11.14(2) of the Rules, the defendant have leave to enforce these orders against the third party before she has satisfied the judgment given in favour of the plaintiff on 11 May 2022.