The
High Court questioned whether it is appropriate to impose indefinite industry bans
against pay-day lenders breaching credit contract laws.
Limited duration bans
are imposed on bankrupts and directors of insolvent companies, Justice Heath
pointed out. He questioned why an
indefinite ban from operating in the credit industry should be imposed for
breaches of the Credit Contracts and Consumer Finance Act.
Gavin John Marsich and
his company Twenty Fifty Club Ltd were both convicted on multiple counts of failing
to provide initial disclosure to pay-day borrowers and of charging unreasonable
fees on short-term loans. As best could
be divined from company records, some 234 payday loans to 82 borrowers did not
comply with the Act. Marsich and his
company were each fined $38,000. Marsich
was ordered to reimburse one customer about $4400. She was left without any means of transport
when a car was repossessed. The trial
judge imposed a life ban on Marsich.
On appeal, Marsich
challenged the court’s jurisdiction. He
referred to 613 commandments he takes from the bible and claimed it was not
open to parliament to enforce any laws which are not supported by these
commandments. Courts are obliged to
enforce laws passed by parliament, Justice Heath ruled.
Evidence was given that
Marsich refused to accept that credit laws applied to him, or that the Commerce
Commission has any authority to investigate his business practices or that he
was required to register as a financial services provider.
Justice Heath urged the
Commerce Commission to consider what might be an appropriate length for banning
orders in future credit contract prosecutions.
Marsich left the court after learning his appeal against jurisdiction would
fail, abandoning any appeal against his lifetime ban.
Commerce
Commission v. Marsich – District Court (24.11.16) & High Court (11.07.17)
17.079