Background
Upendra Saxena, a self-represented litigant, had been a NAB customer for over a decade, holding two personal loans (each capped at $15,000) and two credit cards ($6,000 and $5,000 limits) as at mid-2022. In August 2022, his debt-management agent submitted a hardship proposal to NAB — one that, NAB determined, actually required repayments above the contractual minimums at a time when the accounts were current. NAB declined hardship assistance on that basis. Later that year, NAB reported missed payments to credit bureaux; it subsequently emerged that the payments had been misdirected by Saxena’s agent into a NAB bankruptcy central account rather than his personal accounts. That dispute was resolved through AFCA and a $5,500 goodwill payment to Saxena in July 2023, with NAB also agreeing to shift his loan due dates to the 7th of each month going forward.
The due-date change, however, generated a fresh dispute. When implementing the change, NAB brought forward the August 2023 instalment on personal loan PL 364 from 27 August to 7 August rather than deferring it to 7 September. Saxena did not pay until 5 and 7 September 2023, prompting NAB to report an overdue repayment history item (RHI) for August 2023 on that account. Saxena rejected NAB’s subsequent $1,000 settlement offer and pursued a further AFCA complaint; AFCA found the reporting was incorrectly made (because had the due date remained the 27th, the September payments would have fallen within the 14-day grace period) and awarded $1,000 compensation. Saxena rejected that award as well and commenced Federal Court proceedings seeking $4 million in combined economic, non-economic, aggravated and exemplary damages, along with declarations, permanent removal of all adverse listings, and a written apology.
By the time of the hearing on 11 June 2026, Saxena had abandoned his Privacy Act and National Consumer Credit Protection Act claims and his challenge to the 2022 hardship refusal. His sole remaining claim was that NAB’s making of, and refusal to withdraw, the August 2023 adverse RHI on PL 364 constituted unconscionable conduct under s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth).
The Court’s Holding
O’Bryan J dismissed the proceeding in its entirety, finding Saxena’s claim wholly without merit. The court accepted NAB’s factual account: after the due-date change was confirmed on 27 July 2023, NAB contacted Saxena on 11 August 2023 advising the account was $378.66 overdue and Saxena promised to pay by 2 September 2023. He paid on 5 and 7 September. On those facts, the August 2023 RHI was reported because a payment was genuinely overdue as at the reporting date under the revised repayment schedule, and NAB’s conduct in making and maintaining that report did not satisfy the high threshold for statutory unconscionability under s 12CB.
The court carefully delineated the evidentiary status of the AFCA Determination in Case 12-25-186870. Because AFCA operates on a “without prejudice” basis and the determination was a hearsay document, it was admissible only to contextualise the commercial dealings between the parties — not to prove the facts it recited, and AFCA’s findings were not binding on the court. The court also noted that the adverse August 2023 RHI had, by the time of the AFCA proceeding, dropped off Saxena’s credit file after the two-year retention period, meaning AFCA itself did not need to order its removal.
No order as to costs was made, reflecting the court’s practice of not burdening self-represented litigants with adverse costs orders where the claim, while unsuccessful, arose from a genuine dispute about a bank’s conduct in handling a consumer credit relationship.
Key Takeaways
- An active AFCA complaint does not suspend or pause a borrower’s contractual obligation to make scheduled repayments; adverse RHI reporting during a live dispute resolution process is not automatically unconscionable.
- A bank’s factually grounded adverse credit report — even one that AFCA later characterises as procedurally improvident — does not reach the threshold of unconscionable conduct under s 12CB of the ASIC Act without something more, such as predatory purpose, deliberate exploitation of vulnerability, or conduct that is plainly unfair by the norms of society.
- AFCA determinations are hearsay documents in Federal Court litigation: admissible only to establish the chronology of the commercial relationship, not to prove facts found or bind the court on liability.
- A hardship assistance proposal that requires repayments higher than the contractual minimums on current accounts is not, on its face, an occasion for financial hardship relief.
Why It Matters
The decision clarifies the relationship between AFCA dispute resolution and Federal Court proceedings in the consumer credit space. Borrowers who reject AFCA outcomes and escalate to court cannot treat a favourable (or even equivocal) AFCA finding as a springboard for a statutory unconscionability claim without independent evidence that the bank’s conduct crossed the high normative threshold that Australian courts have consistently demanded since ASIC v Kobelt (2019) 267 CLR 1. The case also reinforces that mandatory comprehensive credit reporting obligations require lenders to report overdue payments accurately; a bank that does so in reliance on contractual terms, even where an administrative due-date change contributed to the shortfall, is unlikely to be found unconscionable in the absence of exploitative intent or special disadvantage.
For consumer advocates and lenders alike, the judgment is a reminder that the AFCA regime and court-based relief operate as distinct tracks: an AFCA-awarded sum (here, $1,000) reflects that body’s assessment of fairness and proportionality, not a legal admission of liability, and declining a modest AFCA settlement in pursuit of multimillion-dollar court damages carries real procedural and costs risk.