ASIC is digging in for a further protracted court battle against Westpac over the bank's responsible lending record.The consumer watchdog is appealing a Federal Court decision in August that shot down its claims that Westpac failed to  properly assess whether borrowers could meet repayment obligations before they entered into mortgage contracts with the bank.ASIC alleges that Westpac committed thousands of breaches of the National Consumer Credit Protection Act over a four year period to 2015, because it relied on a standardised household expenditure benchmark to assess borrowers' living costs, rather than assessing the actual expenses of individual loan applicants. Westpac and the regulator agreed to settle the dispute last year but Justice Nye Perram of the Federal Court said at the time he could not approve the deal because the parties could not agree on how the responsible lending laws had been contravened.Following a full hearing on the question of penalties this year, Justice Perram found in favour of the bank, saying in his August judgment that a lender "may do what it wants in the assessment process".ASIC commissioner Sean Hughes yesterday said the regulator did not regard the Federal Court's decision as consistent with the responsible lending laws."The Credit Act imposes a number of legal obligations on credit providers, including the need to make reasonable inquiries about a borrower's financial circumstances, verifying information obtained from borrowers and making an assessment of whether a loan is unsuitable for the borrower," he said. "ASIC considers that the Federal Court's decision creates uncertainty as to what is required for a lender to comply with its assessment obligation, nor does ASIC regard the decision as consistent with the legislative intention of the responsible lending regime."For those reasons, ASIC will appeal to the Full Court of the Federal Court."In its notice of appeal lodged with the full court on Tuesday, the regulator argues that Justice Perram erred in his application of various parts of the NCCPA to Westpac's home loan assessment process.