Level the commercial disparity for consumers in our courts- deny banks their costs
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With this most welcomed Financial Services Royal Commission well into gear, we should recall that whilst past reforms into our lending laws, the Consumer Credit Code, all have been positive moves towards emphasising responsible lending duties, little has been done towards addressing a pivotal weakness; the commercial disparity of the parties in litigation before the courts.
The reality is that banks, like insurers, NEVER accept responsibility when matters go sour. Never mind the toothless tiger FIS, it is redundant and can be by-passed. True we have our crystal clear laws which give consumers high confidence, but banks can simply avoid rulings and direct disputes for further determination in our courts. After all, they are exercising their legal rights!
They are quite prepared to take on our own Governments, so it is pitiful if they won't take on the relatively microscopic consumer. It is a common tactic which they thrive upon. It is coupled with the WARNING that you can't take on the banks without paying a heavy price. Litigation is 80% about tactics, and 20% about rights. The agenda is simply not to make it commercially feasible for consumers to pursue their rights. Banks are the most ferocious of court litigants, and quite prepared with their arsenal of lawyers to run down a complainant into submission. They have refined this very practice. It is a David and Goliath confrontation.
There must be reforms which addresses this David and Goliath disparity in our courts. A proposed remedy behind this petition is to DENY the legal costs recoverable by the banks. It is a similar PRESUMPTION which is successfully implemented in VCAT and has shelved the lawyers. However, whereas in VCAT costs are not usually awarded to either party, this petition proposes for the rule to be applied ONLY against the banks. If they wish to continue on with their ferocious litigious stance and employ their exorbitant lawyers, they can do so to their shareholders' Turkish delight. But if the consumer succeeds, then the presumption for being awarded with further legal costs remains as fair and reasonable.
This petition addresses the problematic litigious culture of the banks, and places the onus on them, not the consumer, to settle. They have thrived on the knowledge that litigation is not commercially feasible for the small consumer, so let us tilt the scales back for a most needed change.
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