You decide: Could you be your own lawyer?

Updated

"Every man who is his own lawyer," the English writer Henry Kett said, "has a fool for a client."

But what if you don't have a choice?

Legal help in this country is often prohibitively expensive or difficult to find.

Amid the revelations of the banking royal commission, many Australians are forced to stand up in courtrooms and represent themselves when they feel they have been wronged by a financial institution.

It's a gruelling, confusing process. It requires enormous sacrifice. It's prone to failure. Could you do it?

An unexpected $22,000 in fees

Lena Anderson bought a unit in Reservoir, in Melbourne's north, in 2009.

In 2014, Bank of Melbourne (part of Westpac) paid what it said was an outstanding fee of $22,000 to Ms Anderson's owners corporation, and added that debt to her loan, without telling her.

Ms Anderson considered the fee claim fraudulent because the owners corporation had already claimed some of that money back through insurance. She said the fact the bank paid it without her knowledge was "reprehensible".

The bank refused to reverse the payment, and after first taking her claim to the Financial Ombudsman Service (FOS) she decided to stop paying her mortgage until the matter was investigated.

In 2015, the bank took her to court trying to get ownership of the unit.

She was represented at an early stage, but then had disagreements with the law firm.

A second firm asked for $15,000 to appear at trial, which she paid. Just before the court date, she said, they asked for another $10,000, which she could not afford.

What was the outcome?

Bank of Melbourne refunded the money, but continued legal action to reclaim the property, adding its legal fees to her debt.

Ms Anderson ended up representing herself in a four-day trial at the County Court of Victoria. She lost. She appealed to the Supreme Court of Victoria and lost there, too. She is currently facing eviction.

The County Court said the fraud claim was "unfounded".

"While it is understandable that the appellant [Ms Anderson] felt aggrieved by the bank's action, neither the bank's action nor her sense of grievance entitled her to stop making repayments," the Court of Appeal ruled.

The whole experience was "totally indescribable", Ms Anderson said, adding that she felt evidence she put before the court was not properly considered.

"In five years, my relationships have suffered, my friendships have fallen by the wayside, I haven't been able to concentrate on work, my credit profile has been damaged," she said.

"You also have to rise yourself above it. I did a transcendental meditation course to try and help with the stress."

She would get nervous appearing in court, sometimes running to the bathroom to throw up.

She said the bank had offered a settlement — costs incurred, lost income, release from the mortgage — if she signed an NDA. She refused.

She feared the bank would use her previously published advocacy on Facebook as a means of having that agreement torn up.

Bank of Melbourne acknowledged it should have communicated better with Ms Anderson before it paid the owners corporation fee.

The bank said it did not try to take advantage of the fact Ms Anderson could not afford legal representation, and noted she did have a lawyer at various stages in the process.

"At all times, including when Ms Anderson was self-represented, the bank's approach to the litigation was to seek to deal with Ms Anderson fairly and appropriately," chief executive Michelle Winzer said in a statement.

Ms Winzer emphasised that repossession was a last resort used in a very small number of cases, and said it would work to give Ms Anderson more time to move out of her home.

A salary and an art collection that didn't exist

Anita Shannon and her husband Chris bought a property in Bakers Hill, Western Australia, in 2006 with a $452,000 loan through Yes Home Loans (YHL).

Recently moved from Sydney, the couple had their own company developing marketing software and had big plans for their future.

Though they didn't know it at the time, YHL had the mortgage insured using a fraudulent application document.

The handwriting was not theirs. It gave Mr Shannon a random job title and a vastly inflated salary. And it said the couple had hundreds of thousands in assets, including art, none of which was true.

When the bank took the couple to court, seeking repossession of the land because they had failed to make repayments, the couple countersued, saying the whole arrangement was based on a lie.

The Shannons approached numerous community legal centres in WA but were told their case was too complex.

Law firms said either they were conflicted because they had worked for financial service providers, or they simply did not want to take one on.

What was the outcome?

The Supreme Court of Western Australia found the loan application had been forged without the Shannon's knowledge.

But it also found GEL Custodians — the ultimate credit provider who had instigated the court case — was not responsible for YHL's bad behaviour.

It said that while YHL had acted fraudulently, it defrauded GEL, not the Shannons, and that the Shannons should have known they could not afford the loan when they took it out. (This line of reasoning has been used in other cases.)

"Any loss suffered by the defendants [the Shannons] is a result of entering into the loan agreement and mortgage, not a result of YHL applying for and obtaining mortgage loan insurance," the judge said.

The court also found they took too long — more than the required six years — to take action against GEL, even though they did not know about the fraud until 2012, because GEL would not hand over the fraudulent document.

"This is the standard operating methodology," Mr Shannon said, accusing the lender's lawyers of using delay as a court tactic.

The Shannons lost the case.

The court ordered they pay $1.3 million — from an initial loan of less than half that — and that their home be repossessed.

"If we had been able to access legal advice back in 2012, when all of this started, I don't think we would be in this situation that we are in at the moment," Ms Shannon said.

The debt they now face, the possible repossession of their home and the loss of an income — they are now receiving welfare payments — all took an emotional toll. Both Anita and her husband said they had been diagnosed with PTSD.

"I had to choose not to have a family," Ms Shannon said.

"I wouldn't bring children into that [situation]."

But they are adamant they are not victims. They are helping other people in similar circumstances — "companions in misfortune," Mr Shannon calls them.

The couple advise and advocate, sharing their insights into a system they wished they didn't know so well.

"I have realised if they can do this to me, and I am an intelligent guy who can defend himself, what are they doing to people who can't?" Mr Shannon asked.

Ms Shannon said: "This can't continue — not just for Chris and I, but for others."

GEL Custodians could not be reached for comment. Yes Home Loans was deregistered in 2014.

The dream of an organic farm is lost

Single mother-of-one Tasha Keys bought a tea tree farm in northern NSW in 2009, hoping to harvest the oil organically and sell it.

But successive floods in 2010 and 2011, widespread in northern NSW and Queensland, impacted her crop, leading to a repossession two years later. She owed Commonwealth Bank $200,000 in loans.

Ms Keys appealed to FOS, which sided with the bank, but she was unhappy with the decision.

CBA refused to release her from her debts on compassionate grounds.

She took the bank to court alleging a breach of NSW's Farm Debt Mediation Act, which requires advance warning and mediation before a repossession can occur. They countersued her for the loan deficit.

"I went to every corner of the universe" to get legal representation, she said — including Legal Aid and pro-bono assistance through the NSW Law Society — but found little help.

What was the outcome?

Ms Keys had to appear at 19 directions hearings in the NSW Supreme Court — a struggle given she was not living in Sydney.

Lacking the money to fly, she would take the overnight train. That made working a regular job impossible.

While lawyers were able to file certain documents with the court online, she said, regular people like her often had to file in person.

"If you want to lodge a subpoena, you need to present yourself in court in Sydney," she said.

"Every time, making the trip to Sydney, it was $1,000."

She estimates she paid $4,000 in court fees just filing documents.

After a period of representing herself, she hired a law firm for a few weeks on a no-win, no-fee basis to help her in a mediation session.

That cost her $10,000, a deposit she was later told was used to cover "disbursements". It did not result in a resolution.

Ms Keys found the lawyers for CBA "awful", but when she finally met CEO Matt Comyn in 2018 during royal commission hearings, he was sympathetic.

She gave him some of her oils.

"I told him I wasn't after a big pay-day from the bank; I just wanted what was fair," she said.

He called her a few days later with a settlement offer, ending a dispute that had dragged on for three years.

"That made a big difference to my life," she said.

"[But] the fight to get there was so traumatic and physically and emotionally draining."

Her biggest regret: the stress and anxiety of the ordeal, as well as the work required, ate up time she could have been spending with her teenage daughter, who was in high school at the time.

Fighting to win despite losing two properties

Melbourne couple Ana Ganesh and Ganesh Radhakrishnan had six loans spread across three properties, including the family home, from NAB. All up, they borrowed $1.45 million.

In 2010, they say, they asked the bank for an offset account — they wanted to use their rental property income to offset their interest — and believed that, after signing a form, that's what they had been given.

However, after defaulting in 2012, they discovered that what they had actually been given years earlier was an entirely new line of credit, one that had substantially risen their liabilities by including all three properties.

When they defaulted on one loan, the couple say, they were hit with a recall for all six loans, totalling almost $1.5 million.

Confused, they asked for and were given a 140-page outline of their loans.

"Deliberately buried in the middle was a new contract's details page that listed the [three properties] as security," Ms Ganesh said.

"The acceptance page of the contract was absent."

The dispute ended up in court, with the bank seeking repossession to repay its debts, and the couple arguing the bank "foisted" on them a loan they were not aware of and did not agree to.

The couple approached Legal Aid, with no luck. The Law Institute of Victoria suggested three law firms, each of which either cited a conflict of interest in declining to take the case, or charged more money than the couple could afford.

What was the outcome?

Ms Ganesh and Mr Radhakrishnan argue NAB knew it had slipped up and tried to cover its tracks in 2014 when it suggested in a letter that a loan acceptance form was signed by the couple and returned.

But the document it cited was signed in March, 2010 — a few weeks before the supposed offer of credit was made.

A spokesperson for NAB said the bank could not comment because the case was before the courts.

"However, what we can say is we have been working closely with Ms Ganesh and Mr Radhakrishnan and remain committed to achieving a resolution," she said in a statement.

"At NAB, we are committed to acting honestly, consistently and fairly towards our customers in dealing with claims and in the conduct of litigation."

The couple, who have a teenage son with autism, found the court room intimidating and the process, as self-represented litigants, confusing.

"We have had two summonses with a judge, at the end of which a remark was made by the judge that we have been agitating in the wrong court.

"[Because of] this, we have wasted money and time."

A partial summary judgement went in the bank's favour in 2016. The bank was allowed to repossess one of the properties — the family home had already been sold — and the couple were ordered to pay money they owed.

But the judge said the loan agreement involving the date discrepancy needed a closer look.

In the meantime, the couple, who are not employed, are struggling with the emotional toll of the fight, and the workload. They are back in court next month.

The bank has been trying to resolve the issue privately. It wants to get the costly dispute off its books.

But the couple want a trial — despite the frustration of going it alone, they believe they have been wronged and want to be vindicated.

Making his repayments but losing his business

In 2007, Michael Sanderson got a five-year loan to buy a 1,000-acre farm south of Childers. He planned to harvest timber on the property.

Over several years, the bank got a series of valuations that differed significantly. As he was seeking to have the loan rolled over, confident in securing another five years, the value went from $900,000 to $435,000.

Mr Sanderson's loan was $462,500. He believes the changes in valuations were intentional, putting him into what's known as non-monetary default — where a borrower finds themselves in default because of a change of circumstances, not from missing any payments.

Within 12 months, he was served with a notice of intention to sell and subsequently relinquished the property.

He said he approached 50 different lawyers, legal centres and universities looking help, but there was "absolutely nothing out there".

What was the outcome?

Mr Sanderson, who has a learning disability, spent six years in legal action against Bank of Queensland. For much of that time, he represented himself.

"At that time, I didn't know what an affidavit was. I didn't have a clue about anything," he said.

"I am not illiterate, but just to understand the language … it's just impossible," he said.

"The banks know it. They use our legal system as a weapon."

He tried to use his circumstances as a self-represented litigant to his advantage in court.

"I've been in the Supreme Court where the banks have had two specialist barristers and three assisting lawyers. It is painfully obvious there is no equality of arms," he said, referring to a legal principle about balance in court disputes. (The Bank of Queensland disputes that, saying it never had more than one barrister and one solicitor in court.)

A District Court judge in Queensland was sympathetic to Mr Sanderson's argument, but said there was nothing he could do under Australian law.

Mr Sanderson felt the property held considerable value; the bank disagreed.

A spokesperson for Bank of Queensland said Mr Sanderson was not intentionally put in non-monetary default — the valuation was done by an independent firm.

She said the bank tried to work with him and extended his credit for "a number of years" while attempting to resolve the dispute outside of court.

"Mr Sanderson rejected every attempt by BOQ to resolve the dispute, stating he wanted his day in court," the bank said in a statement.

In 2018, after a change in legal strategy, the Bank of Queensland discontinued its case against him. It wiped his debt and offered to pay him $20,000, provided he agreed to not take further legal action.

"Which was ludicrous," Mr Sanderson said. "We've lost the farm; we've lost everything."

Mr Sanderson has become an advocate for others taking action against financial service providers. In submissions to a recent Senate inquiry, numerous people supported his call for equality of arms in Australian courtrooms.

The 2017 Carnell Inquiry recommended banks abolish non-monetary default clauses, though Bank of Queensland said last year it still uses them in "limited circumstances".

Mr Sanderson and his wife Phyllis now rent in Cobram, Victoria. He is on the aged pension — something he did not anticipate.

'Like a penguin in the desert'

Many disputes with banks start out with the organisation's customer advocate or the Australian Financial Complaints Authority, which was introduced in November and replaced other bodies, including FOS.

When the customer remains unsatisfied, that's when things progress to the courts, which are rarely favourable to individuals, according to Gerard Brody of the Consumer Action Law Centre.

Community legal centres — low-cost alternatives to hiring a private lawyer — give advice to about 200,000 people each year, but turn away a further 170,000, the sector's peak body says.

For them, cases involving financial disputes with major lenders are often too complex and take too long to litigate. They can provide phone advice but rarely representation in court.

Legal Aid, which is means-tested, is mostly only available for criminal and family law matters.

The legal sector argues the lack of affordable legal help is the result of successive government funding shortfalls.

In the most recent budget, the Morrison Government proposed an extra $20 million in baseline funding from next year.

The Law Council of Australia, the National Association of Community Legal Centres and other groups called that insignificant, citing a 2014 Productivity Commission report that put an acceptable figure at about $200 million.

In April, a Senate committee recommended the Federal Government put a levy on the largest financial institutions to raise funds for legal assistance and financial counselling for individuals and small business owners.

The Attorney-General's Department told the ABC it was currently considering the Senate report's findings, and noted the Government was reviewing funding for financial counselling.

While those who fought a financial service provider told the ABC they struggled to find a lawyer to help them, that was just one issue.

Just as many said that the solicitors and barristers representing their opponents took advantage of their unfamiliarity with the courts, delaying proceedings and refusing to cooperate.

"One of the frustrations we find, even at the very initial stages of trying to advise people about their rights, is that financial service providers are either unwilling or unable to provide relevant documentation," Mr Brody said.

He said that, like governments, banks should be subject to model litigant rules, requiring their lawyers act fairly, not take advantage of opponents without resources and not rely on technical defences to beat claims.

"The law should never be used as a weapon," Arthur Moses SC, president of the Law Council, the peak body for the legal community, said.

"Lawyers are expected to demonstrate appropriate patience during a trial involving unrepresented parties, as the courts recognise that unrepresented litigants may require additional support in terms of procedural explanation from the court."

However, self-represented litigants told the ABC that support was rarely forthcoming.

They felt talked-down-to by judges and registrars and that their relative inexperience in court — one referred to themselves as "a penguin in the desert" — was glossed over during highly complex hearings.

As Mr Shannon, clearly still bruised by his experiences, said: "If you are not a lawyer, and you are not represented, you are treated as dirt."

Topics: banking, insurance, housing-industry, judges-and-legal-profession, australia

First posted