(2) In subrule (1), condition of mind includes any disorder or disability of mind, any malice and any fraudulent intention, but does not include knowledge."
20 In Johnston v Australian and New Zealand Banking Group Ltd; Johnston v Richardson [2003] NSWSC 454 Davies AJ stated at [26]:
"26 … Fraud must be pleaded specifically and with particularity: see Banque Commerciale S.A. (En Liquidation) v Akhil Holdings Limited (1990) 169 CLR 279 at 285; Wallingford v Mutual Society (1880) 5 App Cas 685 at 701 and Middleton v O'Neill (1943) 43 SR(NSW) 178 at 184. In Lawrance v Norreys (1890) 15 App Cas 210 at 221, Lord Watson said:-
'In my opinion, a plaintiff who desires to avail himself of the provisions of sect. 26 is not released from the ordinary rule of pleading applicable to cases of fraud, which was thus expressed by Earl Selborne in Wallingford v Mutual Society [(1880)] 5 App. Cas. [685 at] 697: 'General allegations, however strong may be the words in which they are stated, are insufficient to amount to an averment of fraud of which any Court ought to take notice.' It is not a sufficient compliance with the rule to state facts and circumstances which merely imply that the defendant, or some one for whose action he is responsible, did commit a fraud of some kind. There must be a probable, if not necessary, connection between the fraud averred and the injurious consequences which the plaintiff attributes to it; and if that connection is not sufficiently apparent from the particulars stated, it cannot be supplied by general averments. Facts and circumstances must in that case be set forth, and in every genuine claim are capable of being stated, leading to a reasonable inference that the fraud and the injuries complained of stood to each other in the relation to cause and effect.'"
21 The identity of the person so closely connected with the company has now been identified so that deficiency that appears in the earlier amended cross claim has been rectified. That person has been identified as Byron Fernando who was employed by Win Win so his state of mind can be treated as the state of mind of the company. However, paragraph 13 does not plead that Mr Fernando was the author of or involved in the making of these false documents. However, r 15.4 states that condition of mind does not include knowledge. The alleged false documents are identified with precision. If the cross claimant did not prepare these documents at the meeting with Mr Fernando, a reasonable inference can be drawn that he was the author. Whether the cross claimant can establish this is a matter for trial. It is my view that this pleading is adequate.
The lender
22 Paragraphs 17 and 18 make allegations against the lender, Perpetual. They read:
17. Further or in the alternative, the contracts with the first cross defendant, the second cross defendant and third cross defendant were unjust at the time they were each made and at times thereafter within the meaning of the Contracts Review Act 1980.
Particulars
(a) The cross claimant repeats the particulars set out at paragraphs 11 and 12;
(b) The plaintiff/first cross defendant failed to prudently require sufficient and appropriate verification of the income and assets of the defendant/cross claimant, such as tax assessment notices, group certificates, copies of filed tax returns, proof of superannuation entitlement and proof of ownership of car before approving the loan and entering into the mortgage with the defendant/cross claimant;
(c) The plaintiff/first cross defendant failed to prudently require an accurate valuation of the property;
(d) The plaintiff/first cross defendant relied upon an inaccurate valuation of the property;
(e) The plaintiff/first cross defendant chose not to contact the defendant/cross claimant directly, prior to entering into the mortgage, but acted at all times through intermediaries.
18. Without the knowledge or consent of the defendant and cross claimant, Byron Fernando, mortgage broker employed by the third cross defendant submitted documents to "Steve" of Mortgage Ezy Pty Limited that did not accurately represent the information provided by the defendant to the second and third cross defendant and that falsely, fraudulently and misleadingly represented the following:
i. That the defendant and cross claimant earned $74,234, when in fact he earned $46,800 per year;
ii. That the defendant and cross claimant worked for Trans Oz Asia Pty Ltd which he did not;
iii. Provided two false payslips;
iv. That Mrs Onesemo had gifted her husband, the defendant and cross claimant, with $50,000;
v. Provided false ATO PAYG payment summary for the year ending 30 June 2006 showing earnings of $74,234.00;
vi. That the defendant and cross claimant had superannuation worth $10,000;
vii. That the defendant and cross claimant had furniture worth $35,000;
viii. That the defendant and cross claimant had a car worth $5,000."
23 Claims have been made against Perpetual under the Consumer Credit Code, Contracts Review Act and a claim for unconscionable conduct. Counsel for Perpetual submitted that correspondence between its solicitors and Mr Onesemo's solicitors amount to representations that he is not alleging fraud against it nor is he alleging that it had knowledge that the documents (payslips etc) were fraudulent. It is not alleged that his signature on the mortgage was forged. Counsel for Perpetual submitted that without allegation of fraud made against it, Mr Onesemo cannot rely on the Contracts Review Act, Consumer Credit Code and unconscionable conduct.
24 Counsel for Mr Onesemo referred to St George Bank Ltd v Trimarchi and Anor [2004] NSWCA 120 where it states at [36]: