Reflections on the Royal Commission that was

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Even though Grondal Bruining is not a plaintiff nor a class action firm, I am following with interest the fallout from the Hayne Royal Commission.

The Royal Commission has ended and the class actions have begun, but not everyone is happy.

NAB had already been fronting a class action for selling (allegedly) questionable credit card insurance. It has now been announced that Westpac is under class action fire for (allegedly) unsuitable loans secured by residential property.  Financial advice, superannuation and insurance will also be target areas.

On the news of the Westpac class action, some on social media called it a case of borrowers – particularly residential property investors - failing to take responsibility for themselves. Some went so far as to say that their greed and foolishness are poor attributes to teach our children. Don’t blame me, blame the bank…


In practice, things are never really that clear. Nor is the requirement for banks to engage in responsible lending particularly new. It’s been long enshrined in the National Consumer Credit Protection Act that the banks are required to assess their clients’ ability to repay their loans.  And the concept of ‘asset lending’ (the practice of lending based on asset availability rather that cash-flow or income based affordability) has also long been treated with judicial and regulatory suspicion.

While the highest legal protection is generally given to loans for household and domestic purposes, which will be the focus of the Wesptac class action, there are of course many others who have been affected by poor practices in the financial services industry.

Consider the profitable business with multi-million dollar turnovers, finding themselves in default because of a change in bank valuation methodology; the sophisticated investor being duped by their advisor’s unauthorised trades; or the heavy handed bank coming down on the investor in a failed managed investment scheme. These are all very real examples of cases that I have been involved in where you just cannot ‘blame’ the borrower / investor, and for whom the new class actions are unlikely be of any help.

With over $400 million being committed in the recent budget to ASIC, to expand its regulation and enforcement of the financial services sector, it’s bound to be an interesting ride. 

But keep an open mind.

Dean Grondal – Managing Principal

Ph: +61 8 6500 4320



Grondal Bruining is a commercial law and litigation firm committed to providing the highest quality legal services. We focus on power & utilities, oil & gas, resources and other commercial and industrial areas. 

Our team is renowned for providing outstanding benefits to clients, delivering proactive and professional advice. Grondal Bruining lawyers have been widely recognised as leaders in their fields by external ratings directories. 

We are conveniently located in West Perth.