Systemic unconscionability and corporate intention
By the Hon Justice Kristina Stern and Scott Murray-Walker
In 2024 Payne JA addressed the Commercial Law Association on the subject ‘How do companies think?’. In setting out his thesis, his Honour suggested that, when determining a company’s state of mind, the relevant question was ‘whose state of mind is attributable to the company’. It is now possible to address a variant on the subject matter of Payne JA’s paper by reference primarily to a case which was handed down shortly after Payne JA delivered his paper last year (and included briefly in the written paper prepared subsequently), the decision of the High Court, delivered on 14 August 2024, in Productivity Partners v Australian Competition and Consumer Commission; Wills v Australia Competition and Consumer Commission (‘Productivity Partners’). This decision has been described as a ‘striking development’ heralding ‘a real innovation in a fundamental aspect of the law of corporations’. The innovation is the approach adopted expressly in the judgments of Gordon J and Edelman J of divining corporate intention from the system, or system of conduct, in place at the company, sometimes now described as ‘systemic intention’.
The ‘gravitational pull’ of the unfair contract terms regime:
Australian Securities and Investments Commission v Auto & General Insurance Limited
By Clare Veal
On 5 April 2021, the Financial Sector Reform (Hayne Royal Commission Response — Protecting Consumers (2019 Measures) Act 2020 (Cth) (Financial Sector Reform Act)) extended the unfair contract terms (UCT) regime in the Australian Securities and Investment Commission Act 2001 (Cth) (ASIC Act) to apply to those contracts of insurance that are regulated by the Insurance Contracts Act 1984 (Cth) (IC Act). The first judicial consideration of the UCT regime’s expanded application was undertaken by Jackman J in Australian Securities and Investments Commission v Auto & General Insurance Company Limited. The appeal from this decision was considered by the Full Federal Court in Australian Securities and Investments Commission v Auto & General Insurance Limited.
This article considers the ‘gravitational pull’ of the UCT regime, as a form of market-rectifying legislation, on judge-made law. Its scope is modest. While the A&G proceedings raised issues about the interaction between the UCT regime and certain provisions of the IC Act, this article focuses on the approach taken in the judgments to the construction of the notification obligation in the term that was alleged to be ‘unfair’. As will be seen, O’Bryan and Cheeseman JJ’s approach in the A&G appeal to the construction of insurance contracts deviates from a conventional approach (reflected in the judgment of Jackman J) to the construction of such contracts as commercial agreements. The thesis of this article is that this deviation represents an effort to cohere the principles applicable to the construction of insurance contracts with the policy of the UCT regime. While it is not suggested that this deviation represents a new rule of ‘general application’ (ie, outside of the context of the UCT regime), it may have important implications for the way in which consumer insurance contracts are drafted and interpreted.
Bribery at common law and in equity: the necessity of a fiduciary relationship post-Hopcraft
Hopcraft and another v Close Brothers Limited; Johnson v FirstRand Bank Limited (London branch) t/a MotoNovo Finance; Wrench v FirstRand Bank Limited (London branch) t/a MotoNovo Finance [2025] UKSC 33
By Edward Goodman
The UK Supreme Court decision of Hopcraft v Close Brothers Ltd; Johnson v FirstRand Bank Ltd; Wrench v FirstRand Bank Ltd resolved three conjoined appeals. The principal issue was the legal characterisation of undisclosed, or partially disclosed, commissions paid by credit lenders to motor dealers in connection with hire purchase transactions and, specifically, whether such payments constituted bribes at common law and/or unauthorised profits received in breach of a fiduciary duty in equity. The Supreme Court concluded that the typical dealer-customer relationship did not give rise to fiduciary obligations and that such a fiduciary relationship was a necessary element for the appellants to succeed in both the claim in equity and at common law.
Bill shock: security, misdelivery and the scope of rights of suit:
Winson Oil Trading Pte Ltd v United Overseas Bank Ltd (‘The Maersk Katalin (CA)’)
By Hamish Sutton
In Winson Oil Trading Pte Ltd v United Overseas Bank Ltd (‘The Maersk Katalin (CA)’), the Singapore Court of Appeal recently considered whether a carrier who delivers cargo without production of an original bill of lading (OBL) may resist a misdelivery claim by demonstrating that the financing bank, to whom the bill was subsequently indorsed, never intended to rely upon it as security. The appeal required the Court to clarify the scope of the statutory rights vested in a lawful holder of an indorsed bill under the Carriage of Goods by Sea Act 1992 (UK) (COGSA), and to determine whether those rights can be displaced or qualified by reference to the parties’ subjective intentions regarding the commercial realities of modern trade finance.
Systemic unconscionability and corporate intention
By The Hon Justice Kristina Stern and Scott Murray-Walker
page
4
The ‘gravitational pull’ of the unfair contract terms regime: Australian Securities and Investments Commission v Auto & General Insurance Limited
By Clare Veal
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18
Bribery at common law and in equity: the necessity of a fiduciary relationship post-Hopcraft — Hopcraft and another v Close Brothers Limited; Johnson v FirstRand Bank Limited (London branch) t/a MotoNovo Finance; Wrench v FirstRand Bank Limited (London branch) t/a MotoNovo Finance [2025] UKSC 33
By Edwaad Goodman
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25
Bill shock: security, misdelivery and the scope of rights of suit: Winson Oil Trading Pte Ltd v United Overseas Bank Ltd (‘The Maersk Katalin (CA)’)
By Hamish Sutton
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30