A husband nearly looses his home, after his wife accesses his bank account to support her gambling habit. Who do you trust with your confidential details?

In these proceedings the Bank sought possession of the defendant husband’s real property in NSW, following default of a loan facility initially made to him in 2004 for $400,000. The loan facility enabled the husband to redraw money and had a key card attached to the account.

At the time of default, the arrears were approximately $55,000. The default was not remedied, and the Bank obtained default judgment for possession of the property. An eviction was scheduled, but ultimately the husband obtained a stay of the eviction, obtained an order setting aside the default judgment and filed a defence. He admitted the loan agreement and the mortgage but denied he was in default. He filed a cross claim against the Bank alleging it had wrongly debited the amounts from his account (other than the scheduled debits).

After numerous investigations, the husband came to believe that it was his wife who was responsible for accessing his accounts through the telephone banking system, and had withdrawn monies to support her gambling habit. The husband claimed to know nothing of his wife’s use of the accounts or the money.

The principal issue in the case was whether the husband and his wife were to be believed that she obtained access to the accounts and misappropriated the funds without the husband’s knowledge. The second issue was whether the husband was in breach of the Telephone Banking Terms and Conditions that formed part of his arrangement with the Bank. The Bank asserts that he contravened those terms by acting with extreme carelessness in failing to protect his PIN and telephone banking password, or he had voluntarily disclosed them to his wife.

The Court held that the Bank failed to discharge its burden of proving the husband had failed to keep his key card in a safe place or to provide reasonable protection from theft. The Court was satisfied that the husband did not know of the wife’s transactions and did not contribute to those transactions, and he had not voluntarily disclosed the PIN to his wife nor acted with extreme carelessness with regards to same. The Court granted judgment in favour of the husband. Whilst it is not clear from the judgment, it would appear this result means the husband can keep his home (but may wish to change his PIN).

Decision date: 18 September 2015.

To read more: see National Australia Bank Ltd v Swed (No 2) [2015] NSWSC 1322 at https://www.caselaw.nsw.gov.au/decision/55f0c155e4b01392a2cd0943