Angel v National Australia Bank Ltd

factual and procedural background 3 I should emphasise that in referring to factual matters I am in no way to be taken as making final findings of fact. I am simply referring to the state of the evidence which is at present before the Court, most of which (but by no means all) is not in issue. 4 On 19 June 1995 the applicants became the registered proprietors of an estate in fee simple in the land comprised within Certificate of Title Vol 1939 Folio 326. From the transfer of land, which is in evidence, it appears that the purchase price was $230,000 including $8,000 which was allocated to chattels. On the same date there was registered a mortgage of that land from the applicants to Elders Ltd. The land comprises a farm property of just over 30 hectares adjoining the South Western Highway approximately 12 kms south of Manjimup. I shall refer to that land as "the Property". The applicants' evidence is that since acquiring the Property they have made substantial changes to it, transformed its former pastoral use into intensive horticulture and made improvements to a café which is situated on the Property. 5 In 1997 the applicants were appointed by Woolworths Supermarkets to be a supplier of horticultural produce including cauliflower, broccoli, brussel sprouts, squash, cucumber and runner beans. 6 At some time before 30 January 1998 the applicants had discussions with the respondent about re-financing their existing facilities with Elders Ltd. It would appear that they asked the respondent for a loan. On 30 January 1998 the respondent wrote to the applicants declining what was described in that letter as their application for finance. It would also appear that there were subsequent discussions which resulted in the respondent agreeing to re-finance the applicants' existing facilities by lending them $444,000 to be secured by a mortgage over the Property. The terms of the loan were that the applicants would initially only have to pay interest on the principal for the first two years, with a debt reduction programme to commence in March 2000 on the basis of a proposed annual reduction of a minimum of $37,000. On 13 May 1998 the respondent loaned $444,000 to the applicants. On that date their mortgage to Elders Ltd was discharged and mortgage G790569 (which I shall refer to as "the Mortgage") from the applicants to the respondent was registered. 7 On 9 September 1999, through their accountant, the applicants applied to the respondent for an overdraft of $50,000. In their application for that overdraft, the applicants' accountant specified why it was sought. Those purposes included the provision of funds for expanded plantings, buying cattle, other purchases and to pay out current creditors. In about September 1999 discussions about the overdraft application took place between the applicants and a Mr Matthew Jarvis, Rural Finance Manager of the respondent at Busselton. It is the applicants' evidence that Mr Jarvis attended the Property for about an hour and a half. 8 The applicants' case has, as a major part of its foundation, what they say were two sets of representations made to them on that occasion by Mr Jarvis. 9 The first (pleaded in paragraph 19 of their statement of claim) was that there would be no difficulty in approving an immediate overdraft facility in the sum of $30,000 and that Mr Angel was free on that day to attend to the immediate purchase of certain steers if he so wished. 10 The second set of representations alleged by the applicants (see paragraph 20 of the Statement of Claim) was that, on the same occasion, Mr Jarvis used words to the effect that "he was impressed with the Applicant's business" and "he did not wish to give the Applicant's (sic) a band aid". The applicants plead that this amounted to an oral implied representation that the applicants could rely on the respondent's "continuing support". 11 On or about 21 September 1999 (being the date on which the respondent debited the applicants' bank account with certain items of stamp duty) agreement was reached between the parties for the extension by the respondent of an overdraft facility in the sum of $30,000. Repayment of that amount was secured by increasing the amount secured under the mortgage. 12 By 28 September 1999 the applicants had overdrawn their account beyond the limit of $30,000. The debit balance at the conclusion of that day was $32,485.42. Thereafter the account was continuously in debit in excess of $30,000. In evidence are some diary memos of conversations between officers of the respondent and both the male and female applicant concerning the account being overdrawn over the limit. They purport to record communication by those officers to the applicants of the respondent's concerns as early as 29 September 1999 about the account debit balance being over the $30,000 limit. By 12 November 1999 the overdraft had reached a debit balance of $51,688.26. On 15 November 1999, Mr Jarvis sent a fax to the applicants which included the following: "… your account balance today is $51,688.26 Dr against your limit of $30,000. Up until now we have allowed excesses on your account as you have advised that payments would be forthcoming very soon. As these payments have not been forthcoming we can no longer permit further drawings unless you can clearly show when and how much these payments will be. Supporting documentation such as delivery dockets or invoices will be necessary. I have endeavoured to phone you on several occasion's (sic) today but have not been able to catch you. I suggest that you give this your utmost attention and contact me in the morning to advise when this information will be available. I can see no point calling on you to discuss a farm purchase until the matter with your overdraft is resolved and income can be proven." 13 On 19 January 2000, the respondent wrote to the applicants pointing out that the excess drawing (i.e. over $30,000) on their account as at that date amounted to $15,852.05 (that is, the account was in debit in the amount of $45,852.05). In its letter (signed by Mr Jarvis) the respondent pointed out that by reason of the default in relation to their bank account, the applicants were also in default with their credit contract in respect of the short term fixed rate interest only loan of $444,000. In the same letter Mr Jarvis warned the applicant that if that default were not remedied within 7 days then that short term fixed rate interest only loan would be terminated and that the bank intended to begin enforcement proceedings. On 20 January 2000 Mr Jarvis sent a further letter in relation to the overdrawn account pointing out that the facility had been in excess of the approved limit for 113 days and requiring the default to be remedied within 7 days. The default was never remedied. 14 A perusal of the bank statements shows that from time to time the applicants deposited cheques to the credit of their current account, but no cheques drawn on the account were honoured. (There are references to dishonoured cheque fees). The result was that by 7 March 2000 the account had been reduced to $38,056.08. 15 On 7 March 2000 the respondent sent a notice to the applicants demanding payment of $484,493.54, being the principal and interest then outstanding on the two accounts maintained by the respondent in relation to the applicants, together with certain fees. The notice of demand warned that if the applicants failed to comply with the notice, the respondent would proceed to exercise its power of sale under the Mortgage together with any other rights powers and remedies conferred under the Mortgage. 16 The applicants' evidence is that they attempted, without success to obtain access to Mr Angel's superannuation funds in order to reduce their indebtedness. Then, in May 2000 they arranged the sale of certain plant and equipment which yielded a net amount of only approximately $2,000. They also listed the Property for sale with three real estate agents, but without success. On 12 June 2000 the respondent issued a notice to the applicants requiring them to vacate the Property. 17 On 13 July 2000 the respondent, by a writ issued by the Supreme Court of Western Australia on that date, sued the applicants claiming an order for vacant possession of the Property by reason of a breach on the applicants' part of the provisions of the Mortgage. That writ was served on the applicants on 4 August 2000. I shall refer to those proceedings as "the Supreme Court proceedings". 18 On or about 14 September 2000, at the request of the applicants, a meeting took place between them, Mr Jarvis a rural financial consultant retained by the applicants and two other officers of the respondent. At that meeting the respondent agreed to withhold further legal action until 30 September 2000 to enable the applicants to clear the whole of their indebtedness to the respondent. 19 On 3 November 2000 Messrs Dwyer Durack, solicitors, entered an appearance on behalf of the applicants (as defendants) in the Supreme Court proceedings. 20 On 15 November 2000, by a chamber summons issued on that date, the respondent applied for summary judgment against the applicants under Order 14 of the Rules of the Supreme Court. The grounds for the application were stated as follows: "1. The plaintiff is mortgagee of the Land [earlier identified in the summons as being the Property] pursuant to mortgage registered number G790569. 2. The defendants are in default of the terms of their mortgage. 3. The plaintiff has made demand for payment of moneys secured by the mortgage. The defendants have not complied with that demand. 4. The plaintiff as mortgagee is entitled to possession of the Land." 21 That summons was supported by an affidavit of Mr M G Frenken, a legal officer employed by the respondent. It verified the contents of the statement of claim which had been filed by the respondent in the Supreme Court proceedings. It also had annexed to it a copy of the Mortgage and a copy of the Memorandum of Provisions incorporated by reference into the Mortgage. In that affidavit Mr Frenken gave particulars of the amounts outstanding, deposed to the fact that the Mortgage created no tenancy other than a tenancy at will, that the only people in possession of the Property were the applicants and that they had no defence to the Supreme Court action. 22 I pause to note that the only order sought in the statement of claim was that the applicants give up and deliver up to the respondent vacant possession of the Property. The order sought in the summary judgment application was that the applicants deliver up possession within 28 days. 23 The application for summary judgment came before Master Sanderson on 1 December 2000. Master Sanderson ordered that the applicants file any affidavit upon which they wished to rely in reply to the respondent's summary judgment application by 14 December 2000 and adjourned that application for further hearing on 15 December 2000. 24 There is in evidence a copy of an affidavit sworn and filed by Mrs Angel on 15 December 2000 opposing the respondent's application for summary judgment. That document, on the face of it, was prepared by Messrs Dwyer Durack. It was sworn on behalf of both applicants. 25 The essence of that affidavit (apart from reciting the factual background) was that had the respondent been prepared to agree not to exercise a power of sale of the Property, the Australian Prudential Regulation Authority would have been prepared to permit Mr Angel's superannuation to be released to him and that as, at that time, the amount owing by the applicants to the respondent on their overdraft facility account was $40,605.33, they only required an additional $879.58 to reduce that overdraft to being within the limit of $30,000. Mrs Angel's affidavit evidence was that they had, in an account with Challenge Bank, sufficient funds to make up that difference. However, so Mrs Angel deposed, the respondent had refused to give an undertaking that it would not exercise the power of sale. In paragraph 20 of her affidavit, Mrs Angel expressed the belief that the respondent had acted unconscionably in refusing to accept payment of funds that would have allowed the applicants to "rectify the stated amounts of arrears". It appears from Mrs Angel's affidavit that the applicants had contacted the Australian Competition and Consumer Commission ("the ACCC"). She exhibited to her affidavit a copy of a fax dated 7 December 2000 from the ACCC which read: "My assistant director has advised me that the matter has the potential to be a breach of section 51AA. You may take private legal action and request a funding subsidy from the Attorney General. (There are no guarantees that he will grant one). Or you could have your lawyer send all your information & details to us and we will assess the matter. However there are no guarantees that we would take on the matter." 26 When, on 15 December 2000, the application for summary judgment came on for hearing before Master Sanderson, he granted summary judgment to the respondent, but ordered that vacant possession of the Property be delivered up to the respondent within 60 days rather than the 28 day period sought by the respondent in its summons. 27 The time for the applicants to appeal against the Master's order expired on 27 January 2001. They did not appeal. On 5 April 2001 the respondent caused a writ of possession to be issued to the sheriff of the Supreme Court, but later instructed the sheriff to delay executing the writ until 7 June 2001. 28 On 5 June 2001 the applicants filed the principal application in this Court. On 11 June 2001 the respondent's solicitors wrote to the applicants advising that in their client's view these Federal Court proceedings were an abuse of process and invited them to discontinue the proceedings. 29 According to an affidavit sworn on 18 July 2001 by Ms Noella Naweena Noeshka Kreleger, a solicitor employed by the respondent, the outstanding amounts owing by the applicants to the respondent as at that date were $80,413.57 in respect of the overdraft facility and $473,902.89 in respect of the interest only loan - a total of $554,316.46. The respondent says that it proposes to sell the Property by auction and has obtained an up-to-date valuation of the Property which values it at $350,000. That valuation is in evidence. It indicates a value in a range between a "forced sale" value of $322,000 and a fair market value of $390,000. The respondent says that it is already faced with a significant loss upon the sale of the Property and that interest continues to accrue at the rate of a total of approximately $4,750 per month. 30 In their originating application in this Court the applicants seek damages pursuant to s 82 of the Trade Practices Act 1974 (Cth) ("the Act"), other orders pursuant to s 87 of that Act, or alternatively, damages at common law for the respondent's alleged negligence and further unspecified relief. They also claim interlocutory relief similar to that sought in their motion filed on 29 June 2001, save that the minimum monthly payment which they undertook to make was stated in their application as $2,500 per month, not the $1,500 per month referred to in their notice of motion. 31 The applicants' statement of claim states that it was prepared by Mrs Angel. It is somewhat discursive and I do not intend to try and summarise it. I have referred above to the two sets of representations pleaded in paragraphs 19 and 20. At paragraph 47 of the statement of claim the applicants allege that Mr Jarvis' conduct in making those representations constituted misleading or deceptive conduct contrary to s 52 of the Act in that the representations are said to have been false misleading and inaccurate. By way of particulars of the falsity the applicants (who rely on s 51A of the Act in so far as the representations were as to future matters) say: · that the respondent in effect only gave the applicants a "band aid" solution by providing the overdraft facility and, despite honouring the cheques drawn by them in excess of the set overdraft limit, shortly thereafter withdrew financial accommodation and proceeded to issue notices of default, a notice to vacate the Property and to institute the Supreme Court proceedings against them; · the respondent, although said to be well aware of the depressed conditions in the Manjimup area, nonetheless elected not to continue to support the applicants and to insist upon exercising the power of sale of the Property in extremely depressed conditions despite their best endeavours to regularise their financial dealings with the respondent; · the applicants were denied the opportunity of continuing financial accommodation in circumstances where they were entitled to believe that the respondent would continue to provide such accommodation "in light of Jarvis's representations that he was impressed with the Applicant's (sic) business". 32 Next the applicants plead that, by making the above-mentioned representations, and by adopting the course of conduct which the applicants have described in paragraphs 14 to 46 of the statement of claim, the respondent has breached s 51AA of the Act by acting unconscionably in trade or commerce. The applicants also plead that the respondent, by engaging in the same conduct described in paragraphs 14 to 46 of the statement of claim, breached s 51AC of the Act by engaging in conduct in connection with its business transactions with the applicants that was in all the circumstances unconscionable. It is difficult to identify the precise conduct complained of, because, amongst other things, some of the paragraphs between 14 and 46 of the statement of claim describe conduct of the applicants themselves. 33 The applicants provide the following particulars of the alleged unconscionable conduct: · the respondent withdrew its financial accommodation previously provided to the applicants despite the "on-going satisfactory performance" of the applicants in extremely difficult economic times in the rural economy; · the respondent, being well aware of depressed prevailing economic conditions in the Manjimup region, refused the applicants the opportunity of trading out of their difficulties or realising the value of the Property in a more favourable economic environment; · the respondent induced the applicants to believe that as a result of Mr Jarvis' representations they could rely upon the respondent to continue providing accommodation to them when "in truth and in fact" the respondent refused to provide continuing financial accommodation; · demanding repayment of all of the financial accommodation previously provided to the applicants when that was not reasonably necessary for the protection of the legitimate interests of the respondent; · ignoring the honest endeavours in good faith that the applicants were prepared to make to return the overdraft facility to within its agreed limit; · exercising the power of sale over the Property whereby it would fail to realise its true value; 34 The applicants also allege that the respondent was under a duty of care to them which it breached by making the representations referred to in paragraphs 19 and 20 of the statement of claim. The essence of the alleged negligence is said to be that Mr Jarvis ought to have disclosed to the applicants that in the event of a breach on their part in complying with its obligations in relation to the overdraft facility, the respondent would not only insist upon repayment of the entire overdraft facility, but also of all of the moneys secured by the Mortgage. 35 I now turn to the respondent's motion that the applicants' claim be struck out as an abuse of process. 36 First, the respondent says that as a result of the judgment of Master Sanderson in the Supreme Court proceedings an estoppel by record arises whereby the applicants may not deny that the Bank is entitled to enforce its security by taking possession of the Property and exercising its power of sale under the Mortgage, and, secondly, that they are prevented from re-litigating issues which have previously been finally determined against them. 37 The respondent submits that the matter is res judicata. It argues that the applicants are prevented from bringing this application against them for what is said to be the same cause of action previously determined. The respondent says that the test of this is the nature of the relief sought by the applicants. The respondent contends that to the extent that the applicants are seeking relief that prevents the respondent from enforcing its rights under the Supreme Court judgment, it is the same action. 38 Alternatively, the respondent claims that there is an issue-estoppel. It says that it is clear from the applicants' own affidavit evidence that they sought to resist the respondent's application for summary judgment by raising a claim of unconscionability under Part IVA of the Act. While acknowledging that the applicants had not expressly raised a claim under s 52 of the Act, it was apparent that the purpose of raising the unconscionability claim was to support a claim for injunctive relief which would effectively defeat the Supreme Court judgment. 39 Finally, in the alternative, the respondent submits that the applicants' claims should be struck out as an abuse of process under the principles explained in Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 ("Anshun").

Res Judicata 40 Perhaps the most succinct statement of the res judicata rule is to be found in the following passage from the reasons for judgment of Fullagar J in Jackson v Goldsmith (1950) 81 CLR 446 at 466: "The rule as to res judicata can be stated sufficiently for present purposes by saying that, where an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action." 41 In Blair v Curran (1939) 62 CLR 464 at 532 Dixon J explained the distinction between res judicata and issue-estoppel in the following terms: "The distinction between res judicata and issue-estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order." 42 In Anshun (a case which most members of the Court held not to involve either res judicata or issue-estoppel), Brennan J at 610-611 referred to the imprecision in the meaning of "cause of action" as tending to uncertainty in defining the ambit of the rule that a judgment bars subsequent proceedings between the same parties on the same cause of action. His Honour identified three meanings for the term, namely: · the facts which support a right to judgment; · a right which has been infringed; or · the substance of an action as distinct from its form. 43 Lord Esher MR in Read v Brown (1888) 22 QBD 128 at 131 adopted an earlier definition [in Cooke v Gill Law Rep 8 C.P. 107] of "cause of action" as: "…every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the Court. It does not comprise every piece of evidence which is necessary to prove each fact, but every fact which is necessary to be proved." 44 This description was accepted by Kelly J (presiding over a Full Court) in Golski v Kirk (1987) 14 FCR 143 at 145 and by Northrop and Lee JJ in Effem Foods Pty Ltd v Trawl Industries of Australia Pty Ltd (1993) 43 FCR 510 at 521. 45 In Letang v Cooper [1965] 1 QB 232 at 242-243 Diplock LJ defined a "cause of action" as: "…simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person." 46 Kelly J in Golski also approved this definition. I shall use it to decide this motion. 47 What may a court look at when seeking to ascertain what was decided by a judgment or order? 48 There are authorities to the effect that when determining what is res judicata, the court may only look at the record i.e. the pleadings and the judgment - see Halsbury's Laws of Australia Vol 12 at [190-80] where the authorities are collected. 49 However, there is some strong authority the other way. For example Davies AJ considered the point in Bulurru Australia Pty Ltd v Oliver (2000) 49 IPR 384 at [32], where his Honour said this: "In order to determine what was decided by a judgment or order, a court may examine not merely the terms of the decision but other relevant material which bears upon the point. Thus, when a case is contested, it is common to look at the reasons for judgment and the pleadings, or if there were no pleadings, at the claims and the evidence. In Rogers v R (1994) 181 CLR 251 at 263; 123 ALR 417 at 426, Brennan J said that, when issue estoppel is raised, a court could examine, "any material that shows what issues were raised and decided" but that, when res judicata is raised, a court is confined to the record. However, para 204 of Spencer Bower, Turner and Handley on Res Judicata takes the view that the same approach applies in relation to both principles of law. I agree with that view." 50 I would be inclined, respectfully, to distinguish Rogers v The Queen on the basis that what Brennan J said was, strictly speaking, in the context of the criminal law. Alternatively, I think it could be regarded as obiter dicta. Certainly there is nothing in the majority judgments in Rogers on this point. 51 In Linprint Pty Ltd v Hexham Textiles Pty Ltd (1991) 23 NSWLR 508 at 516, Kirby P noted that when issue-estoppel was raised, it was permissible to look beyond the formal record [citing Lord Wilberforce in Carl Ziess Stiftung v Rayner & Keeler Ltd (No. 2) [1967] 1 AC 853 at 965] and said: "The foregoing is clearly necessary for a plea of issue estoppel. But it is equally clear that parties may go beyond the form of a formal judgment when determining what is res judicata. Typically, such formal judgments are quite uninstructive, concerning the subject matter of the litigation. Also, typically, such judgments are often taken out by court officers and not by the judge himself or herself. Such is the case in the County Court of Victoria. Therefore, to determine the "res" which is said to be the subject of conclusive judicial determination it is both necessary and appropriate to have regard to matter which goes beyond the form of judgment. Thus, it is appropriate to examine at least the pleadings where issues for trial are stated, the transcript of reasons (if any) given for the judgment or order and, if there be no transcript, the judge's notes or other admissible evidence." 52 In the Supreme Court proceedings between the respondent and the applicants in this matter the pleadings were incomplete. Under Order 14 of the Rules of the Supreme Court of Western Australia (which is in familiar terms) it was for the applicants to show cause or satisfy the Master that there was an issue or question in dispute which ought to be tried, or that there ought for some other reason to be a trial of the claim or part of the claim. Accordingly, where, as in this case, the party contesting a plaintiff's application for summary judgment swears an affidavit, I think that it is permissible to have regard to that affidavit and to any other affidavit evidence of what steps were taken and what transpired leading up to the entry of judgment. I think that this is essential in order to determine what was the res which was adjudicated. 53 There is no dispute that the parties who were the subject of the judgment in the Supreme Court proceedings were one and the same as the parties who are now litigating in the same capacities in this application. 54 Furthermore, I think that it is clear that the judgment given in the Supreme Court proceedings was a final judgment in respect of which res judicata would operate - see Halsbury's Laws of Australia Vol 12 at [190-70] and the cases there discussed. 55 The more difficult question, in my view, is whether the cause of action in the Supreme Court proceedings was the same as that which the applicants wish to litigate in the present application. 56 As mentioned above, I propose to accept and apply the description of the term "cause of action" explained in Read v Brown and Letang v Cooper. That is, to ask what were the facts which it would have been necessary for the respondent to prove (had such facts been traversed) in order to support its right to judgment against the applicants? In my view, those were the facts pleaded in the statement of claim which entitled the respondent to an order that the applicants give up and deliver to the respondent vacant possession of the Property. They would include, in my opinion: 1. The fact that the applicants as registered proprietors of the Property had mortgaged it to the respondent in terms contained in or incorporated by reference into the Mortgage which was duly registered in accordance with the Transfer of Land Act 1893 (WA); 2. That there had been default in making payment of the moneys payable by the applicants to the respondent pursuant to the terms of the Mortgage; 3. That the respondent had served the necessary notices of demand; 4. That the respondent was entitled to possession of the Property; and 5. That nothing contained in the applicants' affidavit resisting the summary judgment application gave rise to an issue or question which ought to be tried. 57 In my view, the only matter relevant for the purposes of considering the application of res judicata, which the applicants raised was their claim that the respondent had contravened s 51AA of the Trade Practices Act by engaging in conduct that was unconscionable within the meaning of the unwritten law, from time to time, of Western Australia. As I have mentioned above, that was particularised as being the respondent's alleged refusal to co-operate in the release of Mr Angel's superannuation entitlement. 58 In short, the applicants took the position that due to that particular alleged unconscionable conduct the respondent was not entitled to an order for possession. 59 In making that assessment, I have had regard primarily to Mrs Angel's affidavit sworn on 15 December 2000, in the Supreme Court proceedings. But I have also had regard to annexure GJA1 to Mrs Angel's affidavit sworn on 12 July 2001 in the present proceedings. That annexure is a letter dated 10 January 2001 from Messrs Dwyer Durack to the applicants reporting what took place before the Master on 15 December 2000. 60 In my view, what the Supreme Court judgment decided, or the res, was that the respondent was entitled to possession of the Property and was not precluded from doing so by the allegedly unconscionable conduct of the sort raised by Mrs Angel before the Master. 61 It follows from this that the applicants' claims against the respondent based on other allegedly unconscionable conduct, allegedly misleading or deceptive conduct and negligence did not, in my opinion, form part of the res decided in the Supreme Court proceedings and that the res judicata rule does not shut out those claims.

issue-estoppel 62 I think that it is sufficient for present purposes for me to adopt, respectfully, the statement of the principle of issue-estoppel made by Dixon J in Blair v Curran at 531-532: "A judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same party or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared." 63 For reasons similar to those set out above which have led me to the conclusion that the claims other than those of unconscionability contrary to s 51AA of the Act did not form part of the res, I do not think that the further issues of fact or law (the claim under s 52 of the Act, other allegations of unconscionable conduct and the claim based in negligence) which the applicants seek to raise in this application form part of any issue-estoppel. These further issues of fact or law were not in my view directly involved in the judicial determination made by Master Sanderson. 64 The respondent relied upon the decision of Tadgell J in Morlend Finance Corporation (Vic) Pty Ltd v Levine [1990] VR 193. That case was also one in which summary judgment was obtained (on appeal from a Master to a Judge) by a mortgagee for recovery and delivery of possession of land. The defendant mortgagor did not appeal but, some 15 months after judgment was entered, applied to the Small Claims Tribunal for relief under s 146 of the Credit Act 1984 (Vic). Under that Act the Tribunal had exclusive jurisdiction to grant the relief provided in s 146. At 210 Tadgell J observed: "It is clear that Mrs Pyke [the mortgagor] cannot be precluded by the operation of the doctrine of res judicatafrom bringing proceedings before the Tribunal under Pt IX of the Act. In no sense can it be said that any cause of action, right or claim given to her by Pt IX was or could have been merged in the judgment given against her in this court in favour of the plaintiff." 65 The respondent relied on the following passage of his Honour's reasons at 211: "Consistently with principle Mrs Pyke would be estopped, no doubt, from contending that the loan agreement and the mortgages were not subsisting and binding and that she was not in default under them according to their terms. The findings against her on those issues were indispensable to this court's decision in favour of the plaintiff: had they not been decided unfavourably to Mrs Pyke, the plaintiff must have failed." 66 His Honour went on to make the following further observations, which I consider to be of assistance in this matter: "I do not understand, however, that in her application to the tribunal Mrs Pyke would seek to allege that the agreement or the mortgages were not subsisting or binding on her, or that she was not in default under them as they stood. Indeed, her case before the tribunal would involve her alleging the contrary. She would necessarily contend, first, that she was bound by the loan agreement and the mortgages, secondly that they are (or were) "unjust" within the meaning of Pt IX and thirdly that the transactions that gave rise to them should be re-opened. The first of those contentions is entirely consistent with this court's decision; and the second and third raise issues that were never before this court and were not and could not previously have been decided between the parties. Mrs Pyke might also contend before the tribunal that she is subject to a judgment for possession of the mortgaged property by virtue of an "unfair" contract or mortgage, but she could not seek to impugn the judgment or the plaintiff's rights under it. This court adjudged the plaintiff to be entitled not to any money sum, but only to possession of the mortgaged property. Upon obtaining possession the plaintiff would be entitled to sell it in order to recover whatever Mrs Pyke should be found to owe. If, before a sale, the tribunal made an order or gave a judgment affecting the amount of the debt, the amount receivable by the plaintiff from the proceeds of sale might be correspondingly affected; and if the tribunal acted after the sale the plaintiff might be required, in practical terms, to forego the whole or part of the proceeds. There is accordingly, in my opinion, no risk of inconsistent or contradictory judgments in the sense referred to in the authorities which would give rise to an issue estoppel." 67 The only relevant difference, in my view, between the decision in Morlend Finance and the circumstances of the present case is that the applicants in this matter could have raised the additional claims under the Act and at common law in the Supreme Court proceedings when the matter was before the Master. But they did not do so and, in my view, those issues cannot be said to have been indispensable to the Court's decision to grant to the respondent an order for possession of the Property.

anshun estoppel 68 Nevertheless, I consider that the further claims which the applicants now seek to raise in this application could and should have been raised before Master Sanderson by way of a proposed defence and counterclaim in the Supreme Court proceedings. In my view, the principle explained in Anshun applies to the present case. 69 In that case Gibbs CJ, Mason J and Aickin J explained the principle in Henderson v Henderson (1843) 3 Hare 100 [67 ER 313] in terms short of the extension of that principle by the Privy Council in Yat Tung Investment Co Ltd v Dao Heng Bank Ltd [1975] AC 581. At 602 their Honours said: "…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 nature of 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." 70 At 603-604 their Honours said: "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." 71 In the present matter I consider that these additional matters which the applicants now seek to raise were so relevant to the subject matter of the Supreme Court proceedings that it would have been unreasonable not to rely upon them in those proceedings. The matters which the applicants now seek to raise go to defeat the rights (including the right to possession of the Property) which the respondent asserts under the Mortgage and the right to exercise the power of sale conferred upon the respondent, in the relevant circumstances, under the Transfer of Land Act. There is also the factor that a judgment in this Court giving possession of the Property to the applicants would conflict, in the relevant sense, with the judgment in the Supreme Court proceedings. 72 I think that the rule in Anshun applies to the present application.

Conclusion 73 For the foregoing reasons the applicants' originating application should be struck out as an abuse of process. 74 The respondent seeks costs of the application on an indemnity basis. 75 In my view, there should be party and party costs, not indemnity costs. My short reasons for this are that I do not think that the circumstances are sufficiently special - see the recent discussion of the matter of indemnity costs by Harper J in Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189. In particular, I do not think that it was sufficiently obvious that the applicants' claims were an abuse of process to warrant the sanction of an indemnity costs order being imposed.

the applicants' motion for an interlocutory injunction 76 Strictly speaking, in view of my above conclusion in respect of the respondent's motion, it is not necessary to consider the applicants' motion. However, I shall do so briefly in case I am held to be wrong in my above conclusion. 77 The applicants' motion was filed on 29 June 2001. I have set out (at para 1 above) the terms of the orders sought. In summary, the applicants sought an interlocutory injunction to restrain the respondent from exercising its power of sale of the Property and from forcing the applicants to give the respondent vacant possession of the Property, subject to certain conditions (see paragraph 1 above). The motion was supported by an affidavit sworn by Mrs Angel on 28 June 2001. It would appear from paragraph 79 of that affidavit that at that time the applicants were still in possession of the Property. 78 In a subsequent affidavit, sworn by Mrs Angel on 12 July 2001, she asserted that the respondent had, since 28 June 2001, taken possession of the Property by forcing entry and changing the locks to the shed and residence on the Property. The respondent's evidence and submissions are that it obtained possession of the Property between 28 June 2001 and 12 July 2001 by the sheriff of the Supreme Court of Western Australia executing a writ of possession requested by the respondent on 5 April 2001. 79 It appears from Mrs Angel's second affidavit that the applicants now seek to regain possession of the Property. She swears to her belief that it would be in the interests of both the applicants and the respondent if the applicants were allowed to "regain possession and attend to the maintenance of the farm property". She further swears that the applicants are willing to undertake to consent to the sale of the farm property "… provided the sale takes place at a reasonable price and we are able to maintain the farm property pending sale." Finally Mrs Angel swears to her belief that economic conditions are such in the Manjimup district and the south-west timber communities that the Property will be sold at a "gross under-value" and probably for an amount below the moneys owed to the respondent. 80 I first consider whether the applicants have raised a serious question or questions to be tried. The authorities show that the various discretionary factors relating to the grant of interlocutory injunctive relief are not to be put into separate compartments, but are to be considered together. I do so, but as I say, I consider this question first. In my view, on the current state of the evidence, the applicants' case is a weak one. For example, I do not consider that the representations upon which they rely lend themselves readily to the characterisation which the applicants assert. Nor do I regard the allegations of unconscionable conduct as being firmly based. They reflect a situation in which the applicants, at a very early stage, exceeded their overdraft limit and immediately had their attention drawn to that default. Then they were given notice that the respondent regarded these breaches seriously and eventually the respondent enforced its rights. Unconscionable conduct on the respondent's part is not readily apparent. Nor do I consider that the claim based on alleged breach of duty of care has much in the way of substance. 81 The next factor which I consider is usually described as the balance of convenience. I think that it is better described as the balancing of the risk of an injustice to one party if an interlocutory injunction is granted against the injustice to the other party if such an injunction is not granted. 82 In my view, the balance of convenience in this matter favours the respondent. 83 If the respondent were immediately to realise its security at the middle range of the valuation obtained, it would sustain a shortfall of proceeds amounting to about $200,000. On top of that interest is accruing at approximately $4,000 per month. 84 The applicants have chosen not to put their financial position into evidence. However, it seems to me reasonable to infer (and I do so infer) from the fact that they have reduced the monthly payment which they were prepared to make in reduction of their debt, ($2,500) as stated in their originating application, to $1,500 per month in their notice of motion, and from the tenor of their evidence and submissions, that they have very limited means. That results in a fairly heavy discount being applied to the value of their undertaking as to damages. 85 Furthermore, it is the general rule that a mortgagor seeking to restrain the exercise by a mortgagee of its rights should be prepared to bring the moneys owing under the mortgage into court or offer to pay it into a secure account. Neither of those circumstances apply in the present case. A further factor is that the terms of the proposed interlocutory injunction are, in my opinion, singularly inappropriate in the circumstances of this case. 86 If the applicants were to succeed in respect of one or all of their claims, they would have an adequate remedy against the respondent in the form of damages. There is no suggestion that the respondent would not be able to meet a claim for damages of the order involved in this matter. 87 Finally, I take into account the matter of delay, although this was not raised by the respondent. In my view, there has been such a delay in this matter, when taken into account with the above factors, as to warrant the Court exercising its discretion not to grant an interlocutory injunction. The applicants were on notice from as early as 12 June 2000 (when they received notice from the respondent requiring them to deliver up possession of the Property) that the respondent intended to take possession of the Property and exercise its power of sale. This was further confirmed on 4 August 2000 when they were served with the writ in the Supreme Court proceedings. They did not seek injunctive relief in the Supreme Court proceedings. On 5 April 2001 the respondent deferred execution of the judgment for possession until 7 June 2001. The applicants left it until 5 June 2001 before instituting these proceedings. There has been no explanation for the delay.

Conclusion 88 For the foregoing reasons the applicants' motion will be dismissed. I certify that the preceding eighty-eight (88) numbered paragraphs are a true copy of the Reasons for Judgment of the Justice Carr.

Solicitor for the Respondent: Messrs Jackson McDonald