Mr Lynch's submissions
63 Mr Lynch declined to consent to the proposed amendments, which he characterised as withdrawals of admissions, for the following reasons:
(a) [Cash Converters] have refused his request to explain when they first became aware of the potential for the Safrock system to generate false documents - absent which [Cash Converters'] delay, and the occasion for the need for amendment, are not explained: cf Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at [103], [108], [131];
(b) [Cash Converters] have refused his request to have an officer of [Cash Converters] provide evidence on oath to explain the basis upon which the admissions came to be made, in particular, in the unusual circumstances where they were made in two separate pleadings and where the documents upon which the admissions were based were provided to Mr Lynch as authentic documents by three law firms acting for [Cash Converters] on four separate occasions including in discovery;
(c) [Cash Converters] have not explained why, with respect to the [second and third loans], the admissions need to be withdrawn (even accepting the potential for the Safrock System to generate false documents) in circumstances where the contemporaneous evidence overwhelmingly supports the conclusion that the documents were in the form pleaded by both parties in the current pleadings; and
(d) he is prejudiced by the withdrawal of the admissions as he has relied upon them and, they materially favoured his case. In contrast [Cash Converters] do not assert any prejudice if they are refused leave. On the contrary - [Cash Converters] presumably considered the allegations to be helpful to them.
64 Mr Lynch's submissions drew attention to the fact that paras 17A, 17B, 22A, 22B, 27A, 27B and 53A of his amended statement of claim were added as a result of the positive allegations made by Cash Converters in its defence. Mr Lynch noted, and it was not disputed that, in addition to the references to the credit proposal documents in the defence and the amended defence, the documents have been provided by Cash Converters in response to certain requests and in discovery, in May 2015, October 2015, December 2015 and February 2016.
65 Thus, Mr Lynch contends, there was no relevant controversy about the credit proposals prior to the proposed further amended defence: cf Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175 at [82] to [84].
66 Mr Lynch complained, and it was not disputed that, if the amendments are allowed, they are likely to necessitate further discovery from Cash Converters.
67 Mr Lynch argued that the explanation for the contested amendments is inadequate for the following reasons:
(1) first, Cash Converters had ongoing statutory obligations to produce authentic documents to their customers or former customers (ss 113, 114, 120 121, and 132 of the National Consumer Credit Protection Act 2004 (Cth) and s 185 of the National Credit Code). The capacity of the Safrock system to store and generate accurate documents was an important matter for Cash Converters in order to comply with their statutory obligations. Absent cogent evidence, it is implausible that Cash Converters were not aware of the way their own system performed prior to filing the defence and the amended defence.
(2) secondly, Cash Converters' explanation fails to identify what steps were taken in respect of the provision to Mr Lynch of documents relating to his loans (in May 2015, October 2015, and December 2015) and subsequently on discovery. There was, and is, no description of what was done, when it was done nor an indication as to whether and if so how it was that the persons concerned were not aware of the features of the system about which Cash Converters have recently instructed HSF.
(3) thirdly, there is no explanation at all for Cash Converters' decisions to plead credit proposals in the defence and amended defence, when persons informed of the features and performance of their own system must have had reason to doubt the correctness of those pleas.
(4) by letter dated 8 November 2016, Maurice Blackburn explained, consistently with Tamaya, that the evidence should be given by Cash Converters and not HSF:
With respect to all of these matters, an explanation from an officer of your clients is appropriate. We do not accept that it is appropriate that the explanation should be given by Mr Betts. We have no doubt that your firm is acting consistently with its instructions and there is no doubt about Mr Betts' professionalism, honesty and integrity. We regret to say that we do not have the same confidence in your clients.
Despite this explanation, Cash Converters has chosen not to provide evidence from an officer of Cash Converters.
68 In relation to the second and third loans, Mr Lynch referred to HSF's 31 October 2016 letter, noting that, even if the Safrock system did not generate credit proposals until after 3 October 2011, it does not explain the withdrawal of admissions with respect to the credit proposals for second and third loans which were entered into after that date. Mr Lynch argued that Cash Converters plainly have available to them records that disclose the template documents at the relevant time, and the kinds of data included in those documents. Further, he noted that the Credit Assistance Consumer Acknowledgments for each of the second and third loans are signed by Mr Lynch. By his signature Mr Lynch acknowledges receipt of a "Credit Proposal".