New South Wales Supreme Court CITATION : Jeans v Cleary [2004] NSWSC 1245 HEARING DATE(S) : 5 November 2004 JUDGMENT DATE : 17 December 2004 JURISDICTION: Common Law JUDGMENT OF : Mathews AJ DECISION : Orders sought in the notice of motion filed on 8 April 2004 declined. The question of costs deferred. Each party to furnish written submissions on the issue of costs by 4 February 2005. CATCHWORDS : Motion to dismiss proceedings - issue estoppel created by admission - no privity of interest - Anshun estoppel - unreasonableness - whether conflicting judgments - application dismissed. LEGISLATION CITED : Trade Practices Act 1974 (Cth) Blair v Curran (1962) 464 Hoystead v Commissioner of Taxation [1926] AC 155 Ramsay v Pigram (1968) 118 CLR 271 Lloyd v Grace, Smith & Co [1912] AC 716 CASES CITED : Carl Zeiss Stiftung v Rayner & Keeler Ltd (No2) [1996] AC 83 at 911 Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589 Henderson v Henderson (1843) 3 Hare at p. 115 [67 E.R. at 319] Minero Pty Ltd v Redero Pty Ltd SC 3288 29 July 1998 PARTIES : John Anthony Jeans - Plaintiff Stephen Thomas Cleary - Defendant FILE NUMBER(S) : SC 20049/04 COUNSEL : J M Ireland QC - Plaintiff A Bell SC with D A McLure - Defendant SOLICITORS : Moloney Lawyers - Plaintiff J K O'Sullivan - Defendant IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION MATHEWS AJ 17 December 2004 20049/04 John Anthony JEANS v Stephen Thomas CLEARY JUDGMENT 1 HER HONOUR: This is an application to dismiss these proceedings upon a number of bases, all of which relate to previous proceedings in the Federal Court of Australia between Deangrove Pty Limited ("Deangrove") and the present plaintiff ("Mr Jeans") as plaintiffs/applicants and the Commonwealth Bank of Australia ("the Bank") as defendant/respondent. 2 The background to the Federal Court proceedings, very briefly, is as follows. Mr Jeans was the sole shareholder and director of Deangrove. In 1998 a contract was entered into between Deangrove and the Bank in which the Bank was to provide a bill discount facility for the purpose of financing a proposed development in North Queensland. Deangrove executed an equitable charge as security for advances to be made by the Bank under the facility. Further security was required from Mr Jeans in the form of an unlimited guarantee of Deangrove's performance under the contract. A guarantee dated 12 June 1998 was apparently executed by him. Thereafter the Bank advanced approximately $7.55 million under the facility. The development was less successful than envisaged, and Deangrove repaid only part of the loan. In the Federal Court proceedings, Deangrove sought damages for losses it was said to have suffered as a result of misrepresentations alleged to have been made on behalf of the Bank. Similarly, Mr Jeans sought to set aside the guarantee of 12 June 1998. The basis of both claims was that the Bank had made a number of misrepresentations and had been in breach of the Trade Practices Act 1974 (Cth). It was an integral part of Mr. Jeans' case that he had in fact signed the guarantee which he was seeking to set aside. 3 The Bank defended the Federal Court proceedings and entered a cross-claim against Deangrove, Mr Jeans and a Mr John Bruce, seeking the amount which was then outstanding under the loan. The cross-claim against Mr Bruce was settled during the course of the proceedings and will not concern us further. The cross-claim against Mr. Jeans claimed, inter alia, that Mr Jeans had entered into a guarantee to pay the Bank moneys owed by Deangrove. Indeed, this was the centrepiece of the Bank's case against Mr Jeans. In his pleadings in response, Mr. Jeans admitted this aspect of the Bank's cross-claim. 4 In no less than three affidavits filed in the Federal Court proceedings Mr Jeans swore that he had signed the guarantee which he was seeking to have set aside. Those affidavits were dated respectively 13 March 2000, 25 September 2002 and 17 March 2003. A copy of the guarantee was exhibited to the affidavit of 25 September 2002. 5 The hearing of the Federal Court proceedings commenced on 17 March 2003 before Sackville J. On the fourth day of the hearing, whilst Mr Jeans was being cross-examined, he was shown a copy of the guarantee. This was dated 12 June 1998 but had in fact been signed on 3 June 1998. The following exchange then took place: "Your signature appears on [page 12] or a copy of it at least? … A signature appears there, yes. It's not the same as my normal signature which is on [page 13]. There is no doubt that it's your signature though, is it? … I can't confirm that right now because it's different from my normal signature. … You are not seriously suggesting to his Honour that you didn't sign this guarantee are you? …. I signed [page 13], that's my normal signature. You are asking me if that's my signature on [page 12], and I'm saying that it is not my normal signature. 6 Mr Jeans said that until the guarantee was shown to him in cross-examination he had never scrutinised it. Accordingly, this was the first time he noticed that his signature as guarantor appeared to be different from his signature in his capacity as director and secretary of Deangrove. A little later he said that the signature purporting to be his personal signature as guarantor was "definitely not my signature." At that point Mr Jeans sought to amend his pleadings by withdrawing the various admissions he had made to the effect that he had signed the guarantee. He also sought leave to raise as a defence to the cross-claim that he did not execute the guarantee and that his purported signature was fraudulently added by an officer of the Bank, namely Mr Stephen Cleary, the present defendant/applicant. 7 Mr Cleary had represented the Bank in most if not all of the initial negotiations and transactions with Deangrove and Mr Jeans. His signature appears as witness to Mr. Jeans' signature on the guarantee. Mr Jeans claims that, as he himself did not sign this document, his signature must have been forged by the person who falsely claimed to have witnessed him signing it, namely Mr Cleary. 8 In a detailed judgment dated 28 March 2003 Sackville J refused leave to Mr. Jeans to withdraw his admissions and amend his pleadings so as to dispute his signature on the guarantee. His Honour noted the unusual circumstances of the case. He expressed the view that Mr Jeans had had "more than a fair opportunity to put forward any basis that may be available to him to challenge the validity or enforceability of the guarantee." His Honour also referred to the history of the proceedings. In fact, this was the second action commenced by Deangrove and Mr Jeans against the Bank seeking the same relief. The first proceedings, commenced in March 2000, were dismissed by reason of the applicants' failure to comply with a self-executing order requiring them to file pleadings by a certain date. Further, a previous trial date had been vacated and the matter adjourned on the application of the applicants. Indeed, in an earlier judgment, Sackville J had referred to the "lamentable history of the litigation" which he said was "virtually wholly attributable to the failure of the applicants to comply with directions made by the Court." This was relevant to the issue then before his Honour, for it was common ground that, if the amendments sought by the applicants were to be made, the proceedings would need to be adjourned, with possible substantial prejudice to the Bank. 9 The hearing before Sackville J then continued upon the basis of the initial pleadings. On 16 May 2003 Sackville J gave judgment in favour of the Bank on all major issues. He concluded that no defence had been shown to the Bank's cross-claim and entered judgment for the Bank against Deangrove and Mr Jeans for nearly 4.75million dollars. An appeal by Mr. Jeans to the Full Federal Court was dismissed on 19 December 2003. 10 Mr Jeans applied to the High Court for special leave to appeal from the Federal Court's judgment. The application was refused on 10 December 2004. 11 On 4 March 2004 Mr Jeans commenced the present proceedings claiming the sum of $4,749,813.13 being the amount recovered against him by the Bank in the Federal Court proceedings. The amended statement of claim alleges a fraudulent misrepresentation on the part of Mr Cleary in asserting that he witnessed Mr Jeans executing the guarantee. Save in one respect, which I shall discuss later, the amended statement of claim remedies a pleading defect which was at one stage relied upon by Mr. A.G. Bell SC, who appeared for the applicant Mr. Cleary on this application. 12 The notice of motion seeks an order that the proceedings be dismissed on three alternative bases. They are: • estopppel • that the proceedings are an abuse of process • that no reasonable cause of action is disclosed. 13 In the alternative, the applicant seeks an order that the proceedings be stayed pending the determination of the respondent's special leave application in the High Court. 14 Each of these matters was strongly contested by Mr John Ireland QC who appeared for the respondent. I will deal with each of the issues raised in turn. Estoppel 15 The applicant suggests that Mr. Jeans' claim is barred by two forms of estoppel, namely issue estoppel and what has become known as Anshun estoppel. These raise different issues and require separate discussion. Issue estoppel 16 The applicant submits that Mr. Jeans is estopped from asserting in these proceedings that he is not bound by the guarantee, as that issue has already been decided against him in the Federal Court proceedings. The Federal Court, in giving judgment in favour of the Bank, expressly found that Mr Jeans was bound by the guarantee. Inherent in that conclusion is the proposition that he signed the guarantee document. As Dixon J said in Blair v Curran (1962 CLR 464 at 532 "The judicial determination concludes, not merely as to the point actually decided, but as to a matter with which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue. Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous." 17 The Privy Council in Hoystead v Commissioner of Taxation [1926] AC155 regarded it as "settled" that issue estoppel applies where the matter which is sought to be re-litigated was the subject of an admission in the earlier proceedings; "The admission of a fact fundamental to the decision arrived at cannot be withdrawn and a fresh litigation started, with a view of obtaining another judgment upon a different assumption of fact." (page 165) 18 Mr Ireland does not dispute that Mr. Jeans' claim in these proceedings is fundamentally inconsistent with the Federal Court's findings in the earlier proceedings. However he points out that an essential requirement for the application of issue estoppel is that the parties to the two proceedings be either the same persons or their privies. Clearly in this case the parties are not the same. Mr Jeans' opponent in the Federal Court was the Bank. In these proceedings it is Mr Cleary. 19 It is the applicant's case that Mr Cleary is the Bank's privy, thus providing sufficient identity of parties to enable the application of issue estoppel. Mr Ireland disputes that a relationship of privity exists between Mr Cleary and the Bank. Indeed the question of privity is the central matter in dispute in relation to issue estoppel, and I turn now to discuss it. 20 Privity in the context of issue estoppel means a relationship of blood, title or interest. It is a privity of interest which is said to exist in this case. The applicant contends that Mr. Cleary is a privy of the Bank because of the employment relationship which existed between them. If Mr. Jeans had been given leave to pursue the forgery allegations in the Federal Court proceedings, it is submitted, he could have done so only on the basis that the Bank was vicariously liable for Mr. Cleary's conduct. In other words, the claim that was sought to be made in those proceedings was in reality a claim against Mr. Cleary, made in that case through the Bank. In the present proceedings the same claim is sought to be made against Mr. Cleary directly. 21 In support of his submission that this creates a privity of interest, Mr. Bell referred to a number of authorities, of which I shall mention only three. 22 In Ramsay v. Pigram (1968) 118 CLR 271 a police officer who was the driver of a car involved in a two-car collision was awarded damages from the other driver (P) for negligence. Subsequently P sued the first driver's employer, the NSW Government, seeking damages on the ground of the police officer's negligence. The High Court found that no issue estoppel had been created by the first judgment as there was no privity of interest between the driver and his employer. Barwick CJ said at 279: "The basic requirement of a privy in interest is that the privy must claim under or through the person of whom he is said to be a privy. Here it is quite clear that the Government had no interest in the action between the respondent and the police officer; nor can it be said that the action brought by the police officer was brought by him in any sense on behalf of the Government ….In every respect the action between the respondent and the police officer was personal to each of them, neither being in any sense in relation to the action or any of the issues involved in it, representative of another. Nor can it be said that the Government in any sense claims under or in virtue of the police officer or of any right of his, or that it derives any relevant interest through him." 23 Mr. Bell submits that the present case can be distinguished from the situation in Ramsay v. Pigram. In this case, he urges, the Bank is responsible to Mr. Jeans for the conduct of Mr. Cleary, because any fraud committed by him was within the course of his employment and in the scope of his apparent authority. In this respect he relies on Lloyd v. Grace, Smith & Co. [1912] AC 716. In that case it was held that a firm of solicitors was liable for the fraud of its managing clerk who, acting within his apparent authority, defrauded a client for his own personal advantage. As Lord Loreburn said at 724: "It was a breach by the defendant's agent of a contract made by him as defendant's agent to apply diligence and honesty in carrying through a business within his delegated powers and entrusted to him in that capacity." In the present case, Mr. Bell urges, Mr. Cleary was acting within his delegated powers when he purportedly witnessed Mr. Jeans' signature, with the result that the Bank was liable for any tortious act committed by him in apparent exercise of this authority. 24 Mr. Bell submits that this employment relationship between the Bank and Mr. Cleary brings the present case within the extension to the doctrine of privity which was referred to by Lord Reid in Carl Zeiss Stiftung v. Rayner & Keeler Ltd. (No. 2) [1996] AC 83 at 911: "There does, however, seem to me to be a possible extension of the doctrine of privity as commonly understood. A party against whom a previous decision was pronounced may employ a servant or engage a third party to do something which infringes the right established in the earlier litigation and so raise the whole matter again in his interest. Then, if the other party to the earlier litigation brings an action against the servant or agent, the real defendant could be said to be the employer, who alone as the real interest, and it might well be thought unjust if he could vex his opponent by relitigating the original question by means of the device of putting forward his servant." 25 I have difficulty in understanding how this extension of the doctrine of privity is relevant to the circumstances which prevail here. In the present case it is the beneficiary of the previous judgment which is said to be in a relationship of privity, not the party against whom the previous judgment was pronounced. Moreover, the extension which was mooted in Carl Zeiss assumes that the losing party in the earlier case does something after judgment has been entered with a view to frustrating the purpose of the judgment. 26 In my opinion there can be no suggestion of privity between the Bank and Mr. Cleary in the circumstances of this case. The issue before the Federal Court, as relevant here, was whether Mr. Jeans was bound by the guarantee. That issue was found against him by reason of his admissions, which he was not permitted to withdraw, that he had signed the document. The case which he was unsuccessfully seeking to put in that Court was that he was not bound by the guarantee because he did not execute it. The identity of the person who forged his signature was irrelevant to that issue. As it happened, it was an officer of the Bank, Mr. Cleary, who purportedly witnessed the signature, and who was therefore alleged to have forged it. But the issue would have been no different if it had been a third party, unrelated to the Bank, who had forged Mr. Jeans' signature. Therefore any employment relationship between the Bank and Mr. Cleary was irrelevant to the fundamental issue which Mr. Jeans was seeking to raise in the Federal Court. 27 Even if this had not been the case, I would have found that there was no privity of interest in the situation which applies here. Mr. Cleary had no relevant interest in the Federal Court proceedings and the Bank has no interest in this case. Accordingly, there is no privity of interest and the doctrine of issue estoppel cannot apply. Anshun estoppel 28 This form of estoppel arises from the judgment of the High Court in Port of Melbourne Authority v. Anshun Pty. Limited (1981) 147 CLR 589. In that case the Authority was one of two defendants in negligence proceedings brought by an injured worker. Each defendant sought contribution from the other. In fact, the other defendant had previously agreed to indemnify the Authority against claims of this nature. However the Authority made no claim under the indemnity in these proceedings. In due course the worker obtained judgment against both defendants. The Authority was ordered to pay 90% of his damages and the other defendant 10%. Subsequently, the Authority commenced proceedings against the other defendant claiming an indemnity in relation to the amounts it had been ordered to pay to the worker. The trial judge ordered that the action be stayed on the ground that the claim under the indemnity agreement should have been raised in the original proceedings. This was upheld by the High Court. 29 The majority of the court (Gibbs CJ, Mason and Aickin JJ) pointed out that although the judgment which the Authority was seeking to obtain in the second proceedings would contradict the earlier judgment, this was not a case of res judicata or issue estoppel. The causes of action were different, and the question of the indemnity was never raised or addressed in the earlier proceedings. 30 Their Honours went on to discuss whether the case fell within the "extended principle" expressed by Sir James Wigram V.C. in Henderson v. Henderson (1843) 3 Hare at p.115 [67 E.R. at 319]: "where a given matter becomes the subject of litigation in and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matters which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time." 31 Their Honours then referred to some of the cases in which the principle enunciated by Wigram V.C. had been affirmed. In certain cases, it had been equated with abuse of process. However their Honours did not regard the abuse of process test as "one of great utility". They preferred a test of unreasonableness: "In this situation we would prefer to say that there will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the plaintiff's claim and its subject matter, it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding." [602] 32 Finally their Honours emphasised the importance of avoiding conflicting judgments: "The likelihood that the omission to plead a defence will contribute to the existence of conflicting judgments is obviously an important factor to be taken into account in deciding whether the omission to plead can found an estoppel against the assertion of the same matter as a foundation for a cause of action in a second proceeding. By "conflicting" judgments we include judgments which are contradictory, though they may not be pronounced on the same cause of action. It is enough that they appear to declare rights which are inconsistent in respect of the same transaction." [603-604] 33 It has now been established that there is not the same requirement for privity in relation to Anshun estoppel as there is in relation to issue estoppel (per Santow J. in Minero Pty. Ltd. v Redero Pty. Ltd. Supreme Court 3288/95 29 July 1998). Indeed Mr. Ireland did not seek to rely on the issue of privity in relation to this aspect of the case. 34 The defendant/applicant in these proceedings submits that this is a classic case for the application of the Anshun principle. The appropriate forum for Mr. Jeans to assert that someone other than himself had signed the guarantee was in the Federal Court proceedings. He failed to do so, and it would be unreasonable to allow him to do so now. It would result in conflicting judgments, as it was an essential part of the Federal Court judgment that Mr. Jeans had executed the guarantee and was bound by its terms. 35 Mr. Ireland submits that there are two significant matters which take this case outside the purview of the Anshun principle. They are first, that Mr. Jeans did not fail to dispute his signing of the guarantee in the Federal Court proceedings. He sought to raise this matter during the course of the hearing, but was not permitted to do so. Moreover, Mr. Ireland urges, the Federal Court judgment is not at all inconsistent with the judgment which Mr. Jeans is seeking to obtain in these proceedings. To the contrary, it is a necessary precondition to his present claim. If Mr. Jeans had not suffered judgment in favour of the Bank in the Federal Court, he would have had no claim against Mr. Cleary. That judgment therefore provides the foundation for these proceedings. 36 The first matter raised by Mr. Ireland requires a return to the Federal Court proceedings, and particularly to Sackville J's reasons for refusing leave to Mr. Jeans to withdraw his admission as to the signing of the guarantee. 37 Sackville J's judgment on this matter was delivered on 28 March 2003. I have already described some aspects of it earlier in this judgment [para. 8]. His Honour discussed the authorities on withdrawal of admissions, and concluded that the Court had a broad discretion to balance all relevant matters in order to ensure that there was a fair trial. The factors which weighed against Mr. Jeans were, in essence: • Mr. Jeans was an experienced businessman with competent lawyers who had had more than a fair opportunity to put forward any case open to him to show that he was not liable under the guarantee. • Mr. Jeans' case, until the third day of the hearing, had involved not only an admission but a positive assertion that he had signed the guarantee. • Whether Mr. Jeans signed the guarantee was a matter within his own personal knowledge. • An adjournment would be necessary if leave were granted, with possible irretrievable prejudice to the Bank. • If leave were granted, completely new issues, involving fraud, estoppel and others, would require to be ventilated and adjudicated. • The proceedings had already been marked by delays and failures on the part of Deangrove and Mr. Jeans to comply with directions of the Court. Finally his Honour made the following observation: "I have reached the conclusion that the applicants should not be granted leave to withdraw their admissions independently of whether they have provided an adequate explanation for the admissions having been made in the first place. In my opinion, however, the explanation provided is not satisfactory. As I have noted, whether Mr. Jeans did or did not sign the guarantee in his personal capacity is a matter within his knowledge. Accepting that he did not scrutinise the guarantee so as to inspect what purported to be his signature, the fact is that he swore three times that he did sign the guarantee. On two of those occasions, he had the guarantee available for inspection if he chose to do so. Mr. Jeans is an experienced businessman who (as is not in dispute) understands the significance of having signed a personal guarantee. I do not regard his failure to check the authenticity of his signature prior to swearing two affidavits asserting that he had signed a personal guarantee as amounting to a satisfactory explanation for withdrawing admissions on factual questions central to the case on the third day of the trial." 38 As indicated earlier, Sackville J. in due course entered judgment for the Bank in the principal proceedings. Mr. Jeans appealed to the Full Federal Court. His sole ground of appeal related to Sackville J's refusal to permit him to withdraw his admissions and reframe his case against the Bank. On 19 December 2003 the Court (Hill, Madgwick and Conti JJ) dismissed the appeal. Their Honours acknowledged that refusal of the motion had very serious consequences, for it "clearly locked Mr. Jeans out for all time to have this issue determined. Failure to grant the motion therefore created a prejudice to Mr. Jeans that could not thereafter be rectified." Nevertheless, their Honours found that Sackville J. had properly balanced all relevant circumstances and had made no error of principle. 39 With this background I return to the question of Anshun estoppel. The majority of the High Court in the passage quoted at [27] above, related the application of the principle to the "unreasonableness" of the party who failed to rely on the issue in the earlier proceedings. They went on to say that it would generally be unreasonable not to plead a defence if it would "be expected" that it would be raised, having regard to the nature of the claim and the subject matter of the litigation. 40 In the present case, as Sackville J. observed, the issue of whether Mr. Jeans had signed the guarantee was central to the question of whether he was bound by it. Before the hearing he not only admitted having signed it, but he made a number of positive assertions to that effect. It was a matter within his own knowledge. Sackville J. concluded that Mr. Jeans' explanation for having made these admissions and assertions was "unsatisfactory." 41 In my view, Mr. Jeans' failure to dispute the signing of the guarantee until the third day of the hearing was unreasonable within the meaning referred to by the majority in Anshun. The fact that he then sought to raise the matter, but was not permitted to do so, does not, in the circumstances of this case, make any relevant difference. 42 The other matter to be considered in relation to Anshun is whether, if this case were prosecuted to a successful conclusion, it would result in conflicting or contradictory judgments. The answer to this question can depend on how the situation is categorised. As Mr. Ireland categorises it, the Federal Court judgment was a necessary precondition to the commencement of these proceedings, as it established the loss which Mr. Jeans is now seeking to recoup. In these circumstances, he submits, there can be no inconsistency between the Federal Court judgment and a judgment in favour of Mr. Jeans in these proceedings. On the other hand, as Mr. Bell categorises it, it was fundamental to the judgment in the Federal Court that Mr. Jeans had signed the guarantee and was bound by it. This was the essential basis upon which the Bank recovered its judgment against him. Had he not been bound by the guarantee, then he would have suffered no loss, and there would have been no need to commence the present proceedings. He can only succeed in these proceedings by establishing a matter which, if accepted, would mean that he should have suffered no loss in the Federal Court proceedings. The judgments would be inherently contradictory. 43 Some assistance can be gained by returning to the facts of Anshun. In that case it was the proceedings brought by the injured worker against the hirer of the crane and the Authority which established the loss which the Authority later sought to recoup in the second proceedings. Had the indemnity been proved in the first proceedings, there would have been no loss. There was an inherent contradiction between the judgment entered in the first proceedings (which was predicated on the absence of an indemnity between the two defendants) and the judgment sought in the second proceedings, in which an indemnity was asserted. 44 There is, in my view, a superficial analogy between the situation in Anshun and that which applies here. The Federal Court judgment established the loss which Mr. Jeans is now seeking to recoup in these proceedings. Had his failure to sign the guarantee been proved in those proceedings, there would have been no loss. The Federal Court accepted a state of affairs which is directly contrary to the proposition which is the centrepiece of Mr. Jeans' case in these proceedings. 45 Had the matter ended there, I would have found that this was a case of Anshun estoppel. However in this case Mr. Jeans, in his amended statement of claim, alleges that he was relying on Mr. Cleary's fraudulent misrepresentation (that he had witnessed Mr. Jeans signing the guarantee) when he accepted, in the earlier stages of the Federal Court proceedings, that the signature on the guarantee was his own. This is a matter which has not been previously ventilated. On its face, it appears to be a strange proposition, and it may well encounter serious factual and legal hurdles. But this is not the occasion for exploring those issues. I am concerned here with estoppel. And in my view there is no legal basis for shutting Mr. Jeans out from asserting this matter. Nor is there any realistic possibility of severing this off from the other allegations in the statement of claim. Indeed this course has never been suggested. 46 In the result, I find that there is no Anshun estoppel to bar the present claim. Abuse of process 47 The defendant/applicant submits, on similar grounds, that the commencement of these proceedings against Mr. Cleary was an abuse of process. Were it not for the matter I have just raised, I would have acceded to thIs proposition. However Mr. Jeans's assertion that Mr. Cleary's fraudulent misrepresentation was responsible for Mr. Jeans' inability to have the genuineness of the signature ventilated in the Federal Court, raises a fresh issue which he is entitled to have adjudicated and determined. Accordingly I find that there is no abuse of process. No cause of action 48 The defendant's notice of motion sought that the proceedings be dismissed on the basis that no reasonable cause of action is disclosed. Since then, Mr. Jeans' statement of claim has been amended. As I understand it, the amendments rectify the defects which would have otherwise have been raised under this head. Mr. Bell submitted, in addition, that Mr. Jeans cannot proceed with the present case without setting aside the Federal Court judgment on the ground of fraud. This he cannot do, as all the facts upon which he would be relying to set aside that judgment were known to Sackville J when judgment was entered. 49 I do not accede to this proposition. No attempt has been made by Mr. Jeans to set aside the Federal Court judgment, and I agree that he would be unable to do so, for the reasons advanced by Mr. Bell. But as Mr. Ireland points out, Mr. Jeans' case is founded upon the existence of the Federal Court judgment, as it established the loss which is sought to be recouped in the present proceedings. It is not necessary for him to seek to set aside that judgment in order to maintain the present proceedings. Stay pending High Court resolution 50 Finally, the defendant/applicant sought a stay of proceedings until the outcome of Mr. Jeans' application (and possible appeal) to the High Court be known. That matter has now been resolved. The application for special leave to appeal was rejected on 10 December 2004. Accordingly that issue is no longer relevant. Costs 51 The final matter relates to costs. This was not the subject of submissions before me. There was good reason for the defendant/applicant to seek to have the proceedings dismissed upon the basis of the original statement of claim. A proposed amended statement of claim was furnished to me during the hearing of this application. This significantly altered the position of the parties in many relevant respects. I would be disposed to make an order that the costs of this application be the plaintiff's costs in the cause. However, I will not make any costs order without giving the parties the opportunity to make written submissions upon the matter. I therefore defer the question of costs. 52 I make the following orders: • I decline to make the orders sought in the notice of motion filed on 8 April 2004. I defer the question of costs, and direct that each party furnish written submissions on the issue of costs by 4 February 2005. ********** Last Modified: 07/16/2007 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.