Cassegrain v Gerard Cassegrain & Co Pty Limited

[This headnote is not to be read as part of the judgment] A statutory derivative action was brought on behalf of Gerard Cassegrain & Co Pty Ltd (GC & Co) against Claude Cassegrain (Claude) and his wife, Felicity Cassegrain (Felicity). Claude was a director of GC & Co. GC & Co's claim related to $4.25M that on 31 October 1993 was credited to Claude's company loan account. This sum was purportedly owing to Claude arising from the settlement of proceedings with the Commonwealth Scientific and Industrial Research Organisation (CSIRO) in the sum of $9.5M. Payment of that sum was a condition precedent to a Deed of Settlement, entered into on 27 September 1993, that became binding on the parties. Claude drew on the loan account for personal and other expenses and had utilised the credit balance in the loan account in purported satisfaction of the purchase price of a farming property (the Dairy Farm), which GC & Co had transferred to Claude and Felicity. Barrett J, as his Honour then was, upheld GC & Co's claim against Claude, finding that Claude had dishonestly breached his fiduciary duty to GC & Co: Gerard Cassegrain & Co Pty Limited v Cassegrain [2011] NSWSC 1156. Claude appealed from the orders made by Barrett J. Claude's appeal raised the following issues: (1) Whether the trial judge failed to adequately take into account Claude's entitlement under the Deed to a half share of moneys payable by CSIRO; (2) Whether Claude and GC & Co were bound by issue estoppels arising from findings made in oppression proceedings in the Federal Court; (3) Whether any relief GC & Co might have been entitled was extinguished by operation of the Limitation Act 1969. In respect of (1): (i) Per Beazley P and Macfarlan JA: On the appeal, Claude was not entitled to rely on the Deed as a defence to GC & Co's claim because it was not argued below: [54]-[56], [197]. Applied: Suttor v Gundowda Pty Ltd [1950] HCA 35; 81 CLR 418. (ii) By the Court: Even if Claude was entitled to rely on the Deed, the terms of the Deed did not establish his entitlement to the $4.25M: [71], [184], [197]. In respect of (2): (i) Per Beazley P and Macfarlan JA: The general rule is that an issue estoppel cannot be waived: [94], [197]. GC & Co did not waive the entitlement: [98], [197]. Applied: Blair v Curran [1939] HCA 23; 62 CLR 464; Re Thoday [1964] P 181 CA 198. (ii) Per Beazley P and Macfarlan JA: GC & Co was entitled to adduce evidence additional to the issue estoppels: [99]-[106], [197]. (iii) By the Court: Claude was bound by the finding in the Federal Court proceedings that when the purported division of the settlement sum was agreed, neither Gerard nor Claude regarded the $4.25M as Claude's money and the purported division did not impose on GC & Co any obligation to pay Claude any part of the $4.25M: [114], [197]. These findings are ultimate facts "fundamental to the decision arrived at" and therefore constitute issue estoppels: [114], [180], [197]. Applied: Blair v Curran [1939] HCA 23; 62 CLR 464. (iv) By the Court: Even if Claude was not bound by the issue estoppels, Claude's fraud was proved by the evidence before the primary judge: [106], [183], [199]. In respect of (3): (i) Per Beazley P: The claim against Claude was analogous to a claim for damages for deceit or conspiracy to defraud and therefore analogous to a claim in tort, for which a 6 year limitation period applied pursuant to the Limitation Act 1969, s 14: [146]. Equity would not apply by analogy s 47: [138]. (ii) Per Basten JA and Macfarlan JA: Claude obtained property from GC & Co in breach of his general law fiduciary duties and his duties under the Corporations Act and whilst the property was in his hands, it was held by him as constructive trustee for the company: [193], [200]. GC & Co's action fell within the terms of the Limitation Act, s 47, for which a 12 year limitation period applied: [193], [200]. Alternatively, s 47 was the statutory provision closest in kind to the circumstances of the case and applies by analogy: [194], [200]. (iii) Per Beazley P and Macfarlan JA: It was open to the trial judge to find that the period in which the company was in receivership was analogous to a state of disability, such that the limitation was suspended during this period pursuant to the Limitation Act, s 52: [156]; [201].

Introduction 2This judgment is concerned with an appeal from orders made by Barrett J (as his Honour then was) in a statutory derivative action brought by Denis Cassegrain (Denis) on behalf of Gerard Cassegrain & Co Pty Ltd (GC & Co) against Claude Cassegrain (Claude) and his wife, Felicity Cassegrain (Felicity): Gerard Cassegrain & Co Pty Limited v Cassegrain [2011] NSWSC 1156 (the GC & Co proceedings). The claim against Claude was upheld, but the claim against Felicity was dismissed. Claude has appealed against the orders made against him. GC & Co has appealed against the dismissal of the claim against Felicity. The appeal against Felicity is dealt with in a separate judgment: Gerard Cassegrain & Co Pty Limited v Felicity Cassegrain [2013] NSWCA 453. 3It is convenient at the outset to record the members of the Cassegrain family and other relevant persons and their respective relationships to GC & Co. Claude and Denis are two of the children of the late Gerard and Francoise Cassegrain. The other Cassegrain siblings (by first names only) are John, Patrick, Anne-Marie and Catherine. Both parents and all siblings, except Catherine, were directors of GC & Co at different points of time. Claude has been a director since 1987. Anthony Sarks was a director from 22 October 1998 until 13 July 2005, when he was replaced by Thomas Cassegrain, Claude's son.

Claude's appeal 4The claim against Claude related to his dealing with part of the sum of $9.5 M, being monies received in the settlement of proceedings that GC & Co had brought against the Commonwealth Scientific and Industrial Research Organisation (CSIRO). In addition to the payment of the $9.5 M, GC & Co entered into a Deed of Settlement, dated 27 September 1993, with CSIRO and other related parties (the Deed). On 31 October 1993, the sum of $4.25 M was credited to Claude's loan account with GC & Co (the loan account). This was recorded in the loan account as being monies owing to Claude out of the settlement sum of $9.5 M. Although the trial judge referred to the "creation" of the loan account at this time, the position seems to have been that the loan account was already in existence. Immediately prior to the $4.25 M credit, the loan account had a credit balance of $178,095.16. 5GC & Co alleged that by causing the sum of $4.25 M to be credited to his loan account, Claude breached the fiduciary duty he owed to GC & Co as a director. Central to this allegation was that in 1996, Claude had utilised the credit balance in the loan account in purported satisfaction of the purchase price of a farming property (the Dairy Farm) owned by GC & Co to him and Felicity as joint tenants. Subsequently, in March 2000, Claude transferred his interest in the Dairy Farm to Felicity and she became the sole registered proprietor. Claude also drew on the loan account for personal and other expenses. 6Barrett J held that Claude had breached his fiduciary duty to GC & Co. In reaching that conclusion, his Honour considered that both Claude and GC & Co were bound by issue estoppels arising from Federal Court proceedings in which it was found that Claude had acted oppressively towards the other members of GC & Co (the Federal Court proceedings). His Honour also permitted evidence additional to the estoppels to be adduced and rejected an argument that GC & Co had abandoned or waived the estoppels by so doing. His Honour also held that the proceedings were not time barred. 7His Honour ordered that Claude be permanently restrained from resorting to or dealing with the loan account, ordered that there be an enquiry and that Claude pay to GC & Co by way of equitable compensation the amounts found, on the enquiry, to have been obtained from GC & Co in breach of his fiduciary duty. Orders for the payment of interest and for costs were also made.

Issues on the appeal 8The only grounds pressed on the appeal were grounds 1, 2 and 5A of Claude's further amended notice of appeal. Those remaining grounds of appeal raised the following issues: Ground 1: (1) Whether his Honour failed, or failed adequately, to take into account Claude's entitlement, under the Deed to a half share of moneys payable by CSIRO; Ground 2: (1) Whether his Honour erred in concluding that Claude and GC & Co were bound by issue estoppels arising from findings made in the Federal Court proceedings; (2) Whether, if the parties were bound by the issue estoppels, GC & Co by its conduct in the prosecution of the proceedings against Claude, waived or abandoned any entitlement to rely on the issue estoppels; (3) Whether the issue estoppels asserted by GC & Co could operate if they were inconsistent with the evidence adduced by GC & Co in the proceedings against Claude; (4) Whether GC & Co was precluded from relying upon the issue estoppels in chief and upon an alternative merits case in reply; Ground 5A: (1) Whether any relief to which GC & Co might have been entitled is time extinguished by the operation of the Limitation Act 1969. 9GC & Co filed a notice of contention. Having regard to the issues that remained, the only matter that arose on the notice of contention related to the limitations question. In this regard, GC & Co contended that equity did not, by analogy to limitation periods prescribed by the Limitation Act, apply any limitation on the bringing of a claim for breach of fiduciary duty in circumstances where fraud was involved. GC & Co contended alternatively that if the Limitation Act did apply by analogy, then in this case, the correct analogy was with s 47, relating to a breach of trust. In that case, the analogous limitation period was 12 years.

Dispute between GC & Co and CSIRO 10The background to these proceedings commences with GC & Co's dispute with CSIRO. From 1987, GC & Co had been involved in a venture relating to soil improvement technology with CSIRO since 1987. A joint venture company called Cassiro Pty Limited (Cassiro) was formed. CSIRO held 50 fully paid shares in Cassiro. It appears that GC & Co also held 50 fully paid shares in Cassiro. Disputes arose and, in 1992, GC & Co commenced proceedings in the Federal Court against CSIRO, Cassiro and a CSIRO-owned company, Sirotech Pty Limited (Sirotech). GC & Co alleged oppression, breach of contract and breach of duty against CSIRO and Sirotech and claimed damages and other relief. CSIRO subsequently brought proceedings seeking an order that Cassiro be wound up on the just and equitable ground. 11In the course of the dispute, an amended pleading was drafted, alleging that CSIRO had defamed GC & Co. Settlement proposals were made and on 5 May 1993, GC & Co wrote to the Chairman of CSIRO, particularising its claim in an amount totalling more than $56 M. One aspect of the claim was said to be for $5 M for damage to the reputation, inter alia, of GC & Co and Claude, in being publicly associated with a failed venture that had involved "bitter litigation and disruption to the family and their associated companies' business activities". The letter concluded by stating that a sum of $15 M "tax effective plus legal costs" would be accepted in satisfaction of the claims. The offer was not accepted by CSIRO, which made a counter-offer, which in turn was not accepted. 12A mediation was held, during which GC & Co advised it was proposing to seek leave to amend its pleading to include a claim in defamation and injurious falsehood. There was no reference to any claim by Claude personally and he was not, nor ever, made a party to the litigation. The mediation led to an offer of settlement of $9.5 M by CSIRO, which was communicated on 2 July 1993. On 6 July 1993, in a letter signed by Gerard and Patrick (the 6 July letter), GC & Co informed their solicitors that: "It was resolved at an extraordinary general meeting held by the shareholders on Saturday 3 July 1993 that the following offer in settlement of the dispute would be accepted by Gerard Cassegrain & Co Pty Ltd: $5.25m to Gerard Cassegrain & Co Pty Ltd ($4.32 in respect of damages, $.930 sale of GC & Co's shares in Cassiro Pty Ltd). $4.25m in personal damages payable to Claude Cassegrain." 13In a letter from Claude to GC & Co's solicitors on the same day, Claude advised that he was "prepared to accept in settlement of the proceedings $4.25 [M] as personal damage". The letter continued that "[t]his has been discussed with the company at an extraordinary general meeting held by the shareholders on Saturday 3 July 1993". Barrett J found, at [78], that the meeting referred to "was apparently a discussion on 3 July 1993 involving Gerard, Francoise, Claude and Mr Walmsley, solicitor". 14Following receipt of this letter, on 6 July GC & Co's solicitors wrote to CSIRO's solicitor and suggested that of the $9.5 M, $4.25 M be paid to Claude Cassegrain. Barrett J, at [80], found that at that point in time, Claude's entitlement had not been "tied to any entitlement or loss". 15The following day, on 7 July 1993, GC & Co's external accountant wrote to Deloiotte Touche Tohmatsu, seeking advice on the capital gains tax implications of the settlement sum, which was said to be referable to CSIRO's failure to discharge its duty of care to GC & Co and "[a]n amount payable to the person (director) for defaming the good name of the person". The effect of the advice given was that the payment of compensation to the director would not be treated as a capital gain. GC & Co then renewed its request to CSIRO that $4.25 M of the settlement sum be paid to Claude, identifying defamation as the basis of that claim. 16Barrett J found, at [83], that CSIRO refused to settle on that basis. CSIRO's position was that even if Claude had been a party to the litigation, he would never have received damages in that amount and that he would not have recovered more than $500,000 for any such claim. CSIRO referred to its responsibilities as a Commonwealth instrumentality and said it did not wish to be a party to a document that did not fully represent the true position.

Settlement of the litigation 17Although CSIRO would not agree to the payment of a separate amount to Claude, the settlement nonetheless proceeded. The Deed was executed on 27 September 1993. Claude relies upon the terms of the Deed in answer to the claim that he fraudulently breached his fiduciary duty as a director of GC & Co, as found by the trial judge.

The Deed 18The parties to the Deed were GC & Co, Claude, CSIRO, Sirotech and Cassiro. GC & Co and Claude were defined in the Deed as the "Cassegrain parties". CSIRO and Sirotech were defined as the "CSIRO parties". 19Recitals A to P to the Deed recorded the history of the collaborative arrangement between CSIRO and GC & Co in respect of the possible application of soil technology known as slotting, the establishment of the joint venture company, Cassiro, for the purposes of carrying out that work, the entry into a further agreement relating to a waste water treatment system and the existence of certain patents and patent applications in respect of the design of slotting machinery and in respect of the waste water treatment system. The overall effect of this arrangement was that CSIRO would be responsible for the research and scientific aspects of the collaborative arrangements and GC & Co would provide the funding and the land upon which the research, including its commercialisation, would be conducted. 20Recital U to the Deed referred to the letter dated 5 May 1993, discussed at [11] of these reasons. The letter was annexed in Schedule A to the Deed and was referred to as "the Cassegrain letter". In the definition clause, cl 1.1, "Cassegrain Claim" was broadly defined and included any present or future action, proceeding, claim or demand "in any way from or referable to", inter alia, "any matter referred to in the Cassegrain Letter": subcl (l). 21The central clause upon which Claude relied in support of his contention that he was entitled to half of the proceeds of settlement under the Deed was cl 2.1. Clause 2 was entitled "CONDITION PRECEDENT". Clause 2.1 provided: "The provisions of this Deed do not become binding on the parties unless and until CSIRO has paid by cheque to or at the direction of the Cassegrain Parties the sum of $9,500,000." 22Clause 2.2 stated that the amount of $9.5 M "will be referable" to the following matters: "(a) as to the amount of $8,835,083 - to: (i) the full and final discharge of any and all liabilities for which any party to this Deed has or, but for the execution of this Deed would have had, to pay costs or damages to any other party to this Deed, whether pursuant to Proceedings 3062, Proceedings 3095 or otherwise; and (ii) the benefit of the various covenants, releases, indemnities and warranties entered into, given and made by the Cassegrain Parties under the terms of this Deed; (b) as to the amount of $503,667 - to: (i) the transfer of the GC & Co Technologies (other than GC & Co's right, title and interest in slotting machines) as referred to in Clause 4.2; and (ii) procuring the transfer of the Cassiro Technologies (other than Cassiro's right, title and interest in slotting machines) and of the right, title and interest of Cassiro in certain contracts and arrangements as referred to in Clause 4.13; (c) as to the amount of $155,000 - to: (i) the transfer of the slotting machine referred to in Part 2 of the Schedule F; and (ii) procuring the transfer of the slotting machines referred to in Part 1 of Schedule F, which transfers are pursuant to Clauses 4.2, 4.3 and 4.4; and (d) as to the amount of $6,250 - to the net difference between the value of: (i) the goods, wares and merchandise which are transferred to GC & Co as referred to in Clauses 15.9(a)(ii) and 15.9(a)(iii) (which are valued in aggregate at $3,390); and (ii) the goods, wares and merchandise which are transferred to CSIRO as referred to in Clause 15.9(b)(i) (which are valued in aggregate at $9,640)." 23Other relevant provisions of the Deed were as follows: cl 6.1, by which GC & Co, Cassiro and Claude accepted certain restraints on future activities; cl 7, whereby the parties were to seek the making of certain orders by consent to put an end to the two Federal Court matters; and cls 8, 9, 10 and 11, which recorded certain comprehensive releases and indemnities given by and to GC & Co, Claude and Cassiro. There were other detailed warranties, releases and indemnities given by GC & Co and Claude. 24There was no specification in the Deed as to any division of the settlement sum between GC & Co and Claude, nor was there any reference to any specific interest of any party in any part of the monies payable under the Deed. 25GC & Co gave CSIRO a written direction, also dated 27 September 1993, in respect of the payment of the $9.5 M settlement monies. The bulk (approximately $8.3 M) was directed to be paid to the State Bank of New South Wales (the State Bank) with the balance of the monies (approximately $1.1 M) being directed to be paid to GC & Co's solicitors, presumably for legal costs, and a separate small amount (approximately $20,500) specified as being payable on account of income tax for Cassiro. At the time of the settlement, GC & Co was heavily indebted to the State Bank and the monies payable to the Bank pursuant to this direction were credited against GC & Co's overdraft and loan accounts. 26Prior to the settlement, GC & Co's solicitors had written to the State Bank asserting that the monies payable pursuant to the settlement were damages for both GC & Co and Claude. The letter also asserted that whilst there was no statement in the Deed as to the amount to be apportioned to each, "there was no disagreement that a significant sum is being paid to [Claude]". 27As previously stated, on 31 October, an entry was made in GC & Co's books of account crediting $4.25 M to Claude's loan account.

The taxation litigation 28The Commissioner of Taxation assessed GC & Co in the 1994 financial year on the basis that the sum of $9.5 M received by way of settlement was assessable income in the hands of GC & Co. GC & Co objected to the assessment. It failed in the Administrative Appeals Tribunal, but was successful on appeal to the Federal Court. On remittal to the Administrative Appeals Tribunal, the focus was upon the proper taxation treatment of the $8.8 M, being the sum specified in cl 2.2 of the Deed. This change of focus caused Barrett J, at [104], to observe: "The significant point is that ... GC & Co initially took the line with the ATO that $4.25 million of the settlement moneys had gone to Claude to settle his own 'defamation action against CSIRO' and that GC & Co subsequently changed tack. Once it had been held by Lindgren J ... that GC & Co had succeeded in showing that Claude had provided part of the consideration for the $9.5 million by surrendering claims and giving contractual undertakings, GC & Co's focus shifted to attributing sums to a range of elements of the consideration so provided by Claude ... The overwhelmingly predominant element then became foregone remuneration with only a relatively modest $500,000 for 'general reputation damages for his defamation claim'."

Transfer of the Dairy Farm 29On 2 September 1996, Claude and Anne-Marie, as directors of GC & Co, resolved that GC & Co transfer the Dairy Farm to Claude and Felicity as joint tenants for a consideration of $1 M, together with the assets of the farm for their written down book value. A Valuer-General's valuation supported the consideration of $1 M and there was no evidence to suggest that the transfer was at an undervalue. 30A transfer, between GC & Co as transferor and Claude and Felicity as transferees, dated 14 September 1996, was executed under the common seal of GC & Co. Mr McCarron, solicitor, signed the transfer as solicitor for the transferees. The transfer was registered on 10 March 1997. 31In accordance with a resolution of directors passed on 2 September 1996, the consideration for the transfer of the Dairy Farm and other property was debited to Claude's loan account. The loan account was adjusted to reflect a reduction in the balance owing by GC & Co to Claude equal to the amount of the consideration. The bookkeeping entry recording the debit was made on 30 June 1997. Barrett J held, at [111], that the financial impact of the transaction was suffered on that date. This date is relevant because of the limitations issue. 32On 24 March 2000, Claude, as transferor, executed a transfer in favour of Felicity as transferee for an expressed consideration of $1. Mr McCarron signed as solicitor for the transferee.

Findings of the trial judge relating to Claude's fraud 33Before dealing with the issues raised by Claude on the appeal, the findings of the trial judge that formed the basis of his conclusion that Claude acted fraudulently in breach of his fiduciary duty should be noted. Whilst there is no direct challenge to these findings, they will fall away if Claude succeeds in establishing that he was not bound by the issue estoppels created by the findings in the Federal Court proceedings and establishes his entitlement to a sum of approx $4.25 M pursuant to the Deed. 34The relevant findings are as follows. 35Barrett J found, at [118], that the driving force in the decision to split the settlement monies between GC & Co and Claude, other than amounts deducted for costs and other smaller amounts, was the objective of avoiding capital gains tax. His Honour also held that CSIRO played no part in the decision as to how the settlement sum was to be divided. The division of the settlement monies was effected wholly within GC & Co, in the sense that the only place it found expression was in GC & Co's books of account. 36His Honour held, at [119], that the issue estoppels were fully supported by the evidence. He considered that, in particular, the submissions made by GC & Co upon remittal of the tax proceedings to the Administrative Appeals Tribunal, that only $500,000 of the sum of $4.25 M was payable in respect of defamation and the balance was for foregone income, showed "that the original pretext for compensation for damage to reputation was simply an invention by Claude". His Honour observed that Claude changed the basis upon which he said he was entitled to the monies when it suited him to do so. 37It followed, on his Honour's reasoning, at [120], that: "The basis put forward at the time of the CSIRO settlement for allocation of $4.25 million to Claude was simply an invention - an invention that was abandoned in the later tax proceedings ..." 38At [121], his Honour held the sum of $4.25 M credited to the loan account did not represent a genuine indebtedness of GC & Co to Claude. Accordingly, to the extent that Claude received payments from GC & Co, he had taken monies of GC & Co to which he had no legal entitlement. His Honour thus observed, the loan account was "a false loan account". 39At [122], Barrett J characterised GC & Co's complaint in relation to the Dairy Farm as being that there was "no giving of valuable consideration" in return for the transfer because Claude purported to pay the company by recording a reduction in the loan account. His Honour noted that GC & Co had not suffered harm merely by the creation of the loan account because GC & Co's asset base remained the same. (In this regard, his Honour must be taken to be referring to the crediting of the loan account with the $4.25 M: see [4] above.) 40However, as his Honour observed, on each occasion GC & Co gave value to Claude and there was a corresponding debit in the loan account, Claude was misappropriating company funds, because he knew that he "had no right to demand or receive money from GC & Co by reference to the loan account". The misappropriation included recording a reduction in the loan account of $1 M in respect of the transfer of the Dairy Farm to Claude and Felicity. 41His Honour held, at [126], that Claude, as a director of GC & Co, owed a fiduciary duty to GC & Co, which he breached in preferring his own interests over that of the company. His Honour reiterated, at [127], that the purpose of the apportionment of the settlement sum between GC & Co and Claude was to provide a basis from which it could be argued that GC & Co's capital gain was $5.25 M, rather than $9.5 M. His Honour held, at [127]-[128], that Claude "acted dishonestly" because "he never had any genuine or objectively based belief that the settlement moneys included $4.25 million for him as compensation for defamation", that his action in establishing the loan account (that is, the credit balance of $4.25 M) was therefore also dishonest, and that he further acted dishonestly by drawing on the loan account. Barrett J found, at [129]: "It follows that, on each occasion on which Claude obtained money or value from GC & Co which reflected in a reduction of the loan account balance, he acted not only in breach of fiduciary duty but also dishonestly. It is therefore correct to categorise his conduct as dishonest or fraudulent breach of fiduciary duty. It went beyond the pleaded alternative of recklessness." 42His Honour found, at [147], that there was no consent by GC & Co to the creation of the $4.25 M credit in the loan account so as to excuse his breach of fiduciary duty. In reaching that conclusion, his Honour rejected an argument advanced by Claude that, as by the combined effect of Articles 61 and 66 of GC & Co's Constitution Gerard had the power to determine the outcome of any resolution put to the members in general meeting, GC & Co had effectively consented to the loan account in Claude's favour because Gerard had agreed to it at a meeting held on 3 July 2006: see [134]-[135]. As Barrett J explained, at [139], the basal difficulty with this submission was that the power only operated at a duly convened general meeting and there was no evidence that any such meeting had been convened.

Ground 1: whether Claude was entitled to the monies under the terms of the Deed of Settlement 43Claude contended that the trial judge erred in failing to take into account Claude's entitlement to one-half share of the moneys payable to the Cassegrain paries under the Deed. The appellant submitted that Claude's joint entitlement with GC & Co to a share of the CSIRO settlement monies, the covenants, releases and undertakings given by Claude under the Deed, and the value of the consideration that passed from Claude under the Deed were, jointly and severally, an answer to the claims (including the allegations of fraud) made against Claude in the name of GC & Co. 44GC & Co argued that Claude was not entitled to raise this argument on the appeal as it had not been raised in the Court below. His pleaded case had been that he was entitled to the sum of $4.25 M pursuant to an agreement between him and Gerard. His reliance on the Deed as establishing that he was entitled to half of the proceeds of the settlement sum had not been pleaded or otherwise raised in the court below. In particular, GC & Co submitted that the Deed had not been pleaded as an answer to the alleged fraudulent breach of fiduciary duty. To the extent that the Deed had been relied upon at trial, it was only in the context of just allowances, if liability was in fact established. 45GC & Co pointed out that Claude had not given evidence in the proceedings, nor otherwise adduced evidence of any agreement with his father in support of his pleaded case, so that aspect of his case necessarily failed. GC & Co submitted that the fact that the Deed was in evidence was not sufficient to satisfy the principles governing the raising of a new case on appeal: see Suttor v Gundowda Pty Ltd [1950] HCA 35; 81 CLR 418. 46Claude accepted that the defence as filed below did not expressly raise the question of the construction of the Deed . He submitted, however, that the point was raised in written submissions dated 1 April 2011, filed prior to the commencement of the hearing. That submission stated: "The existence and terms of the CSIRO Deed ... upon the face of which Claude was jointly entitled with the Plaintiff to receive the CSIRO settlement moneys (and, therefore, as a matter of law, half the sum paid by the CSIRO), are inconsistent with any attribution of fraud or dishonesty to Claude." 47In support of his position that he ought now be permitted to rely upon the Deed to advance ground 1, Claude referred to the observation of Mason J in O'Brien v Komesaroff [1982] HCA 33; 150 CLR 310 at 319 that: "In some cases when a question of law is raised for the first time in an ultimate court of appeal, as for example upon the construction of a document, or upon facts either admitted or proved beyond controversy, it is expedient in the interests of justice that the question should be argued and decided (Connecticut Fire Insurance Co. v. Kavanagh (1892) AC 473, at p 480; Suttor v. Gundowda Pty. Ltd. [1950] HCA 35; (1950) 81 CLR 418, at p 438; Green v. Sommerville [1979] HCA 60; (1979) 141 CLR 594, at pp 607-608 )." 48Claude emphasised that this passage was cited with approval by the plurality in Coulton v Holcombe [1986] HCA 33; 162 CLR 1 at 8, where it was said: "In our opinion, no distinction is to be drawn in the application of these principles between an intermediate court of appeal and an ultimate court of appeal." 49In Suttor v Gundowda, the plurality (Latham CJ, Williams and Fullagar JJ) stated, at 438: "The circumstances in which an appellate court will entertain a point not raised in the court below are well established. Where a point is not taken in the court below and evidence could have been given there which by any possibility could have prevented the point from succeeding, it cannot be taken afterwards. In Connecticut Fire Insurance Co v Kavanagh [(1892) AC 473], Lord Watson, delivering the judgment of the Privy Council, said, 'When a question of law is raised for the first time in a court of last resort, upon the construction of a document, or upon facts either admitted or proved beyond controversy, it is not only competent but expedient in the interests of justice, to entertain the plea. The expediency of adopting that course may be doubted, when the plea cannot be disposed of without deciding nice questions of fact, in considering which the court of ultimate review is placed in a much less advantageous position than the courts below.'" 50The plurality also cited Grey v Manitoba and North Western Railway Co of Canada (1897) AC 254 at 267 where Lord Hobhouse observed: "The questions now raised ought to have been raised on the pleadings and evidence so that they might be properly thrashed out in the courts below. As the matter stands they have not been touched by the courts below ... they (their Lordships) confine themselves to deciding the issues which the court below were invited by the plaintiffs to decide." 51The plurality endorsed the observation in University of Wollongong v Metwally [No 2] (1985) 59 ALJR 481, at 483, that: "It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so." 52There are exceptions to this principle, including where a question of law is involved such as in the construction of a document: see O'Brien v Komesaroff. However, in my opinion, Claude's reliance on the terms of the Deed does not only raise a question of construction. Had he pleaded or otherwise raised that case at trial, a question would undoubtedly have arisen as to his entitlement to enter into the Deed so as to obtain, for himself, a payment of, or entitlement to, half of the settlement monies. To have done so may, in itself, have constituted a breach of his fiduciary duty to GC & Co. The important point, however, is that GC & Co would have been entitled to test matters such as this. 53GC & Co also submitted that had any of these matters been in issue in the proceedings in a way that resulted in Claude giving evidence, it would have cross-examined him on what was said to be an exemplification of his "shifting stance" as to the basis of his entitlement to half of the settlement monies. GC & Co complained that it had been deprived of that opportunity. That is undoubtedly correct but need not be considered as it involves a degree of speculation as to whether Claude would have gone into the witness box and for the reasons I give below, I consider that leave should be refused. 54I have concluded that Claude's written submissions filed before trial were not sufficient to allow this point to be argued on the appeal. First, as GC & Co, submitted, a case based on the Deed was never propounded in the Court below. Secondly, the written submission may have been different from what is now put. The entitlement asserted in the written submission was that GC & Co and Claude were "jointly entitled ... to receive the CSIRO settlement monies (and, therefore, as a matter of law, half the sum paid by the CSIRO)". On appeal, the entitlement asserted under the Deed was a "joint entitlement (as tenants in common in equal shares)". But in any event, if such a case had, in fact, been argued at trial, particularly if it was as part of an attempt to assert a claim as tenant in common to half of the settlement monies, it can only be assumed that GC & Co would have vociferously defended that case. In particular, it is likely that it would have asserted that an entry into the Deed on that basis would itself have been in breach of Claude's fiduciary duty, even if it was otherwise appropriate for him to be a party to the Deed. Thirdly, for the reasons explained, this argument would not, in any event, succeed. 55GC & Co also referred to Claude's application to amend his pleading just prior to trial, in which he attempted to allege a form of estoppel and abuse of process arising from the taxation proceedings. The application to amend was heard by the court on the first day of the hearing and notwithstanding Claude's written submission which raised the terms of the Deed, Claude's amendment application did not include any claim based upon the Deed. It was submitted that that was another indication that Claude had not relied on this ground below and that to the extent the issue was raised in the written submission, it never formed part of his case. 56It follows, in my opinion, that leave to raise this ground ought to be refused. 57GC & Co also submitted that any attempt by Claude to rely on the terms of the Deed would be defeated by the parol evidence rule in circumstances where, in the absence of a reference in the Deed to any entitlement of Claude to a sum of money, Claude would be forced to rely upon extrinsic evidence to support his construction of the Deed. Presumably, this would require reliance upon the letter to CSIRO of 5 May in which a claim for $56,033,000 was made, including a sum for $5 M for defamation: see at [11] above. 58Alternatively, or additionally, Claude may have to rely upon the letter of 6 July 1993. That letter was signed by Gerard and Patrick under the name of GC & Co. Neither the Deed, by its terms, nor, for that matter, the written direction to pay, reflected the terms of the letter of 6 July. Thus, even on Claude's case, he would have to rely on evidence additional to the terms of the Deed. In my opinion, GC & Co's submission should be accepted and provides another reason for refusing leave to raise ground 1 of the appeal. 59Should the other members of the Court not agree that leave to raise this ground should be refused, I will consider briefly Claude's argument that he was entitled to half of the settlement monies under the terms of the Deed. 60Claude identified a number of provisions in the Deed which he said supported his position. In particular, he referred to the recitals that outlined the history of the parties' relationship and dealings and the disputes that arose. He relied in particular upon Recital U and the letter of 5 May 1993, which was incorporated into the Deed as part of Schedule A. Claude emphasised the broad definition of the "Cassegrain Claim" in cl 1.1(l), which specified that the "Cassegrain Claim" included "any matter referred to in the Cassegrain Letter". This definition was substantially mirrored in the definition of the "CSIRO Claim". Claude also identified cl 2.1 as being crucially important. 61Claude submitted that the phrase "to or at the direction of the Cassegrain Parties the sum of $9,500,000", in cl 2.1, was unambiguous and parol evidence was not required in aid of the construction of the clause. 62GC & CO submitted that the reference in the Deed to the settlement to "[a]ny and all claims" included the proposition that Claude had no claim. Nor did the compendious joint and several references to Claude in the Deed suggest that he had any entitlement to a particular sum or portion of the settlement monies. In particular, GC & Co submitted that there was nothing in cl 2.1 of the Deed which acknowledged the existence, validity or quantum of any claim by Claude. 63Claude also submitted that cl 2.1 must be construed in the light of the Conveyancing Act 1919, s 26(1). That section provides: "In the construction of any instrument coming into operation after the commencement of this Act a disposition of the beneficial interest in any property whether with or without the legal estate to or for two or more persons together beneficially shall be deemed to be made to or for them as tenants in common, and not as joint tenants." (emphasis added) 64"Disposition" is defined in s 7 as including: "... a conveyance, and also an acknowledgment under section 83 of the Probate and Administration Act 1898, vesting instrument, declaration of trust, disclaimer, release and every other assurance of property by any instrument except a will, and also a release, devise, bequest, or an appointment of property contained in a will; and dispose has a corresponding meaning." 65Claude submitted that this meant CSIRO's commitment to pay the $9.5 M was to pay GC & Co and Claude as tenants in common in equal shares. It followed, on this submission, that crediting the loan account with the sum of $4.25 M was not inconsistent with cl 2.2. Claude submitted, therefore, that the $4.25 M credited to the loan account and the $1,786,163.05 drawn from the account was in accordance with his entitlement to the monies payable under the Deed. Claude also submitted that he provided consideration for CSIRO's promise to pay him one half of the settlement amount by undertaking the substantive covenants, undertakings, releases and warranties provided for in cls 6.1, 8.1, 14 and 15. He emphasised that the covenants were not limited to any cause of action. 66Claude also contended that the written Direction to Pay, whereby the substantial amount of the settlement monies was directed to be paid to GC & Co's banker, was of little or no consequence as between Claude and GC & Co if his construction of cl 2 was correct. Rather, as Claude was entitled to half of that money, he had, in effect, lent his half share to the company and the crediting of that sum to his loan account did no more than record that loan. 67Claude submitted, therefore, that the trial judge's finding, at [83], that the CSIRO: "... refused to countenance either an apportionment between GC & Co and Claude or any acknowledgment of any claim in defamation on Claude's part to which any part of the overall settlement sum was attributable" was both immaterial and erroneous, given that the letter of 5 May 1993 was incorporated into the Deed. Claude submitted that in light of these considerations, the debiting of the loan account with the sum of $4.25 M was not open to criticism and was not a breach of his fiduciary duty as a director of GC & Co. 68Claude also emphasised that GC & Co did not plead that Claude was in breach of his duties as a director by entering into the Deed with CSIRO. Claude further submitted that no such argument could be raised on the appeal in accordance with the principle stated in Suttor v Gundowda. 69Claude submitted that had the respondents attempted to argue that he had acted wrongfully by entering into the Deed, it was possible he would have adduced evidence to counter any such suggestion. Claude also pointed out that his siblings were signatories to the Deed and were not under an misapprehension as to its terms. 70The first question which arises is whether the Deed effected a "disposition" of the beneficial interest in property so that the Conveyancing Act, s 26 can be called in aid in the construction of the Deed. The effect of the Deed was, relevantly, to provide for the transfer of intellectual property to the CSIRO and the transfer of the CSIRO's shares in Cassiro to GC & Co or its nominee. In addition, the Deed effected a complete release of any possible claims the Cassegrain parties (or any of their Associates as defined) and CSIRO and Sirotech had against each other. There were cross-indemnities in respect of any such claims. Importantly, the payment of the sum of $9.5 M was not made under the Deed. Rather, payment of that sum was a condition precedent to the operation of the Deed. 71Accordingly, for Claude to be entitled to $4.25 M of the settlement monies, he needed to establish there was some basis for the entitlement. The Deed did not provide it. For that reason, the argument based on s 26, if allowed, would fail in any event. 72There is another reason why Claude cannot succeed on this argument. If the issue estoppels are made out, Claude is precluded from asserting that he was entitled to the monies. For the reasons considered below, I consider that the issue estoppels have been made out and Claude was estopped from asserting that he was entitled to the monies by virtue of the Deed.

The case law 73Claude submitted, for the reasons discussed below, that Barrett J erred in holding that the parties were bound by issue estoppels arising from the decision of Davies J in the Federal Court proceedings. 74The principles governing the circumstances in which an issue estoppel arises and the effect of any issue estoppel were considered in Blair v Curran [1939] HCA 23; 62 CLR 464, to which Barrett J referred, at [55]. In Blair v Curran Dixon J observed, 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 parties 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." 75Dixon J, at 532, explained the distinction between res judicata and issue estoppel as 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." 76Dixon J continued that "[n]othing but what is legally indispensable to the conclusion" of the prior judgment is estopped. Where questions of fact are involved, the issue estoppel is "confined to those ultimate facts which form the ingredients in the cause of action, that is, the title to the right established". The estoppel however is not "confined to the final legal conclusion expressed in the judgment, decree or order". 77His Honour, at 532, adopted what was said by Coleridge J in R v Inhabitants of the Township of Hartington Middle Quarter (1855) 119 ER 288 at 293 and explained: "... the judicial determination concludes, not merely as to the point actually decided, but as to a matter 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." 78Dixon J, quoting from Lord Shaw in Hoystead v Commissioner of Taxation (1926) AC 155, at 165, observed that: "... 'a fact fundamental to the decision arrived at' in the former proceedings and 'the legal quality of the fact' must be taken as finally and conclusively established." (citation omitted) 79Dixon J further explained, at 532-533: "But matters of law or fact which are subsidiary or collateral are not covered by the estoppel. Findings, however deliberate and formal, which concern only evidentiary facts and not ultimate facts forming the very title to rights give rise to no preclusion. Decisions upon matters of law which amount to no more than steps in a process of reasoning tending to establish or support the proposition upon which the rights depend do not estop the parties if the same matters of law arise in subsequent litigation. The difficulty in the actual application of these conceptions is to distinguish the matters fundamental or cardinal to the prior decision or judgment, decree or order or necessarily involved in it as its legal justification or foundation from matters which even though actually raised and decided as being in the circumstances of the case the determining considerations, yet are not in point of law the essential foundation or groundwork of the judgment, decree or order." 80In Lombardo v Stuart Bros Pty Ltd (1967) 68 SR(NSW) 159 at 162 Walsh J stated: "One can look at the reasons ... to elucidate what was decided and to ascertain what findings were indispensable bases of the decision." 81There is a further principle which should be noted at this stage, namely, that an estoppel cannot be enlarged by evidence. The principal was stated by Evatt J in O'Donel v Commissioner for Road Transport & Tramways (NSW) [1938] HCA 15; 59 CLR 744 at 763: "... when a distinct and separate issue arises subsequently, [the unsuccessful party] is not bound to submit to the second issue being established by the combination of a former issue with additional evidence, no matter how strong such evidence may be." 82However, there was no suggestion in this case that GC & Co had attempted to do so. Claude's contention was different, as is discussed below.

Trial judge's findings concerning Claude and the effect of the issue estoppels 83In the Federal Court proceedings, Davies J declared that: "... the actions of the first respondent, Claude George Rene Cassegrain, in treating the $4.25m loan account with Gerard Cassegrain & Co Pty Ltd as his entitlement to be drawn down at his will, in drawing upon the loan account as he saw fit and in causing the passing of a resolution of directors allowing for the payment of retrospective interest thereon were actions which were oppressive of and unfairly prejudicial to the members of the company." 84Barrett J held, at [64], that the following issue estoppels arose from those proceedings and bound both GC & Co and Claude: "(a) that the division of the $9.5 million settlement proceeds between Claude and GC & Co was agreed by Claude and Gerard for the sole purpose of reducing capital gains tax liability of GC & Co on those moneys; (b) the $9.5 million was paid to GC & Co and received by it in settlement of its claim against CSIRO and no attempt was ever made genuinely to estimate a sum for any personal claim by Claude; (c) when the purported division was agreed in July 1993, neither Gerard nor Claude regarded the $4.25 million as Claude's money; and (d) the purported division did not impose on GC & Co any obligation to pay Claude any part of the $4.25 million." 85Barrett J, at [62], considered that "[t]he oppression of which Claude was held guilty was, in effect, treating the loan account as his own to resort to as and when he saw fit". His Honour also considered, at [63], that it was necessarily implicit in the findings of Davies J in the Federal Court proceedings that there was another finding, namely, that the $4.25 M was not Claude's to deal with as he wished and, therefore, that the so-called loan account was not a loan account at all. Barrett J, at [65], concluded that those findings were of "central significance" in the current proceedings, but held that they were not "dispositive" and that it was necessary to consider the essential factual matters. 86His Honour, at [66], rejected Claude's contention that a party could either rely on issue estoppels or "abandon them and seek to prove relevant matters afresh". As his Honour said, issue estoppels "put established facts at the disposal of the parties and the court" who must accept those facts. Barrett J was of the opinion that those facts did not constitute the whole of the available facts and that "[i]t is open to the plaintiff to prove other facts in the ordinary way". 87His Honour also held, at [119], that the issue estoppels were "fully supported by the evidence". His Honour's conclusions in this regard are at [118]-[122].

Submissions and consideration 88Claude's grounds of appeal in respect of this issue are set out at [8] above. However, by reference to his written submissions, Claude's challenge to the trial judge's decision was that his Honour erred in relying upon issue estoppels said to arise from the Federal Court proceedings in the following respects: (i) GC & Co had waived any entitlement to rely upon the issue estoppel by seeking to advance evidence about contested facts; (ii) if there had been no waiver, GC & Co was not entitled to rely upon evidence additional to the issues estoppels; and (iii) the issue estoppels identified by the trial judge were not, in any event, available.

(i) Can an issue estoppel be waived? 89Claude submitted that there is a fundamental inconsistency between asserting a case of issue estoppel and a case predicated upon an assumption that the parties could engage in a fresh litigation of all the issues. He referred the Court to Kok Hoong v Leong Cheong Kweng Mines Limited [1964] AC 993 at 1017-1018; Republic of India v India Steamship Co Limited [1993] AC 410 at 421-423; and, by analogy Commonwealth v Verwayen [1990] HCA 39; 170 CLR 394 at 468, 472-275 and 482-486. 90In Kok Hoong v Leong Cheong Kweng Mines Limited the Court considered the question whether an estoppel could be raised in the face of a statute. Their Lordships, at 1017-1018, recognised that there was a principle that limited estoppels where statutes were infringed. Their Lordships also accepted that there may be cases where a litigant may have so conducted earlier proceedings that a court hearing later proceedings would hold the litigant to the manner in which the earlier proceedings were conducted, on the principle that a party cannot approbate and reprobate. 91The present proceedings do not raise any question of an estoppel in the face of a statute. Nor was it argued that GC & Co or the persons for whose benefit the derivative proceedings were brought, approbated and reprobated as between the two proceedings. The point litigated in these proceedings was the same as in the Federal Court proceedings, namely, that Claude had no entitlement to the sum of $4.25 M out of the settlement proceeds. The existence of other claims in the Federal Court proceedings does not involve any approbation and reprobation. In my opinion, this decision did not assist Claude's argument. 92Republic of India v India Steamship Co Limited was also a case of a different kind to that with which the Court is concerned with here. In that case, it was held that a particular provision of a statute created a defence to a cause of action rather than excluding the Court's jurisdiction. The Court held, at 424, that a statutorily available defence could be waived, or be the subject of an estoppel, or be the subject of a contrary agreement. 93In Commonwealth v Verwayen the High Court, by majority, held that the Commonwealth could not rely upon a limitation defence. The majority was divided as to whether the operative principle was that of waiver or estoppel. The case did not involve a waiver of an issue of estoppel. 94In my opinion, the general rule is that an issue estoppel cannot be waived. This is apparent from the formulation of the principle in Blair v Curran. In Re Thoday [1964] P 181 CA 198, Lord Diplock stated, at 198, that where an issue has been determined in a case: "... neither party can, in subsequent litigation between one another upon any cause of action which depends upon the fulfilment of the identical condition, assert that the condition was fulfilled if the court has in the first litigation determined that it was not, or deny that it was fulfilled if the Court in the first litigation determined that it was." 95The principle has been reiterated more recently in Island Maritime Limited v Filipowski [2006] HCA 30; 226 CLR 328. In that case, Gummow and Hayne JJ observed, at [56], that: "It may readily be accepted that the need to maintain the incontrovertibility of earlier decisions can be identified as an important root of the principles of issue estoppel that have been developed and are applied in civil proceedings." 96There may be exceptions to the general rule in special circumstances: see Arnold v National Westminster Bank [1991] 2 AC 93 at 106-107; Watt v Ahsan [2008] 1 AC 696 at 708. In Arnold, the special circumstances were said to include the bizarre construction of certain legislation adopted by the trial judge which had been rejected in later cases, and the absence in that case of any right of appeal. Lord Keith, who gave the principal speech in Arnold, noted that while the bar created by a merger and cause of action estoppel was absolute, that was not so for issue estoppel. His Lordship explained, at 109: "... there may be an exception to issue estoppel in the special circumstance that there has become available to a party further material relevant to the correct determination of a point involved in the earlier proceedings, whether or not that point was specifically raised and decided, being material which could not by reasonable diligence have been adduced in those proceedings. One of the purposes to estoppel being to work justice between the parties, it is open to courts to recognise that in special circumstances inflexible application of it may have the opposite result ..." 97Claude submitted that in the Federal Court proceedings, Davies J proceeded on an erroneous assumption that the Deed provided that all of the settlement sum was to be paid to GC & Co and not to GC & Co and Claude. This submission was based on Davies J's reasons, where his Honour commented that "[t]he lengthy and complex terms of settlement ... provided for payment by CSIRO to GC & Co or at its direction of $9.5m". However, the Deed referred to payment "to or at the direction of the Cassegrain Parties: cl 2.1. "Cassegrain Parties" was a defined term to mean GC & Co and Claude. Claude submitted that this erroneous assumption undermined the soundness of Davies J's later findings. 98I do not agree that this error was sufficient to displace the general rule, assuming that Barrett J was otherwise correct in holding that there were binding issue estoppels arising out of Davies J's findings in the Federal Court proceedings. As I have already explained, the monies were not payable under the Deed, but as a condition precedent to its operation. There was no provision in the Deed relating to Claude's entitlement to any or any particular portion of the monies. If he had any such entitlement it had to be established outside the terms of the Deed.

(ii) Was GC & Co entitled to adduce evidence additional to the estoppels? 99Claude contended that GC & Co was not entitled to adduce evidence additional to the estoppels. In this regard, Claude submitted that the trial judge's comment, at [66], that the respondents could "prove other facts in the ordinary way" revealed error, as the entitlement to an issue estoppel is not discretionary. This complaint was based in part on a pleading point, in part on a procedural issue and also upon a contention that it was not permissible to assert a case based on issue estoppels and a case predicated upon an assumption that issues could be relitigated afresh. This argument was a variant on its argument that GC & Co could not plead a factual case in its reply. I will deal with this argument in that context. 100GC& Co's pleading in the statement of claim was based upon the issue estoppels. Claude denied each of the estoppels. In its reply, GC & Co pleaded as follows: "13. In the alternative to the estoppel pleaded in paragraph 12 above [GC & Co] joins issue with [Claude] in respect of each of the matters pleaded ..." 101Claude submitted that an alternative pleading could not be raised by way of reply, as to do so would be in contravention of the Uniform Civil Procedure Rules 2005 (UCPR), r 14.18(1). UCPR, r 14.18 provides: "(1) A party must not in any pleading make an allegation of fact, or raise any ground or claim, inconsistent with any of his or her previous pleadings. (2) Subrule (1) does not affect the right of a party to make allegations of fact, or raise grounds or claims, in the alternative." 102In my opinion, this complaint has not been made out. Paragraph 13 of GC & Co's reply was not inconsistent with the pleaded issue estoppels. Rather, faced with Claude's forensic challenge to the case based on issue estoppels, this pleading signalled GC & Co's intention to advance a case based on evidence. If the estoppels were made out, GC & Co would have the benefit of their incontrovertibility: see Island Maritime Limited v Filipowski. If not, it needed evidence to make out its case. Whilst, as a matter of pleading, GC & Co should have sought to amend its statement of claim, rather than plead its alternate case in reply, Claude made no complaint at trial by reference to a point of pleading. It is too late to raise this complaint on the appeal. Claude can, of course, maintain his substantive complaint that evidence cannot be adduced additional to the estoppels. 103Claude also contended that GC & Co was bound by the terms in which leave was granted to Denis under the Corporations Act 2001 (Cth), s 237, which, he contended, was by reference to the draft statement of claim before the court on that application. In particular, Claude submitted that leave had not been granted to conduct a retrial and GC & Co had not applied for an extension of that leave. 104This argument must also be dismissed. Contrary to Claude's submission, the leave was not confined in the way alleged. Sackville AJ, who granted Denis leave, stated, at [117]: "In my view, Denis has satisfied the criteria specified in s 237(2) of the Corporations Act. I therefore propose to grant leave to him to bring proceedings in the name of the Company and to file pleadings in the form of the [draft statement of claim]. It will be a matter for the Judge dealing with those proceedings to determine whether leave should be given to amend the [draft statement of claim] ..." 105Although GC & Co did not seek leave to amend its statement of claim, it pleaded an alternative case in reply. Barrett J allowed the case to proceed on that basis. No objection was taken at trial on the basis that leave to proceed with the claim was confined to the pleading in the draft statement of claim. In my opinion, this argument ought to be rejected. 106This disposes of the additional argument to which I have referred at [99]. I would only add that there was no substance in Claude's submission that his Honour had it in mind that the "Court could pick and choose alternative versions of the facts to accommodate its perception of the justice of the case". I have explained why there was no error in allowing a case to be pleaded in the alternate. In further response to this submission, and to bring it more closely into line with the ground of appeal, Claude did not at any stage identify what facts were inconsistent with the issue estoppels. As I have discussed in Gerard Cassegrain & Co Pty Limited v Felicity Cassegrain [2013] NSWCA 453 at [113]-[117] fraud was independently proved on the evidence.

(iii) Were the estoppels made out? 107Claude submitted that the Declaration was incapable of sustaining any issue estoppel against Claude. Two arguments were raised in support of this submission. First, Claude contended that it was an abuse of process for GC & Co to attempt to litigate a case it had lost or abandoned in the Federal Court. This argument was based upon the dismissal by Davies J of the trust claims and his refusal to grant consequential relief on the oppression claim. The second argument was that the basis upon which Davies J had made the Declaration in the proceedings did not give rise to the estoppels. As the two arguments intersect, I will deal with them together. 108Claude submitted that the Declaration made by Davies J was predicated upon the existence and validity of Claude's $4.25 M loan account and was directed only to whether it was oppressive for Claude to make withdrawals without shareholder consultation in circumstances where he had frozen the accounts of the other shareholders in another family entity. It was said that this was apparent from the acceptance by Davies J in the Federal Court proceedings that: (a) the loan account had been created in the books of account of GC & Co; (b) a "split" of the $9.5 M was agreed between Claude and Gerard, a matter utterly inconsistent with the findings of fraud by Barrett J; and (c) the "mere purported division of the $9.5 million may not, of itself, have amounted to oppressive conduct for it was a step taken to reduce the liability of the company". 109This submission does not accurately represent Davies J's findings. His Honour rejected Claude's evidence that he considered the $4.25 M to be his share of the settlement. It was in that context that his Honour accepted that a split of the $9.5 M had been agreed between Claude and Gerard, but for the specific purpose of reducing capital gains tax. His Honour did not find that to be necessarily oppressive. Rather, as Davies J found, "it was Claude's subsequent use of the money as if it was his own" (emphasis added), together with the pretence about an agreement as to interest on the money, that was oppressive. 110Thus, whilst it was not in issue in the Federal Court proceedings that Claude had a loan account, an issue in the oppression suit was whether he had an entitlement to $4.25 M out of the settlement monies so as to entitle him to the benefit of the credit entry in the loan account in that sum. In this regard, Davies J held: "I am satisfied that Gerard and Claude did not at the time [of settlement] regard the sum of $4.25m as Claude's money" 111Davies J found that there was no attempt to genuinely estimate a sum for any personal claim by Claude in the CSIRO proceedings and further, that neither Gerard nor Patrick, who signed the letter of 6 July 1993, "looked upon the $4.25m as Claude's money". Davies J, on the basis of those findings, held: "Claude's actions in arranging for the purported division of the $9.5 into $5.25m for GC & Co and $4.25m for Claude, his drawing upon that sum at his will as if it were his entitlement to do so ... was exemplary of oppressive behaviour. It is a very plain illustration of conduct by a person who, in practical control over the affairs of a company, has acted to benefit himself to the detriment of the other persons who are interested in the company. The mere purported division of the $9.5m may not, of itself, have amounted to oppressive conduct for it was a step taken to reduce the tax liability of the company. It was the subsequent use of the money by Claude as if it were his own ... which constituted oppression of the other shareholders. In my opinion, the events which occurred in relation to the settlement moneys provide a clear instance of oppressive conduct and I shall make a declaration accordingly." 112Claude also submitted that issue estoppels said to arise from the Davies J proceedings could only have been accepted by the trial judge if Barrett J ignored Davies J's express warning that his reasons had to be read as a whole; his definition of "oppression" as encompassing "actions which are or may be" unfairly prejudicial; his dismissal of all other claims for relief; and the significance of the fact that no party to the Federal Court proceedings challenged the validity or operation of the CSIRO Deed or the Memoranda of Transfer whereby the Dairy Farm was transferred to Claude and Felicity and then to Felicity. 113These submissions also fail to fully or accurately reflect Davies J's judgment. Rather than engage with each submission, I will deal with the question in issue, namely, whether the findings made by Davies J constituted issue estoppels for the purpose of the present proceedings. The bases upon which Davies J made his Declaration were his findings that Claude was not entitled, and never believed he was entitled, to the $4.25 M credited to his loan account out of the settlement monies. Accordingly, he had no entitlement to draw upon the loan account at will. The central issue in the present case was whether Claude had fraudulently credited $4.25 M to the loan account in circumstances where he had no entitlement to that sum out of the settlement monies. If he had no such entitlement, the subsequent drawings on and debits to the loan account, were fraudulent. 114Claude also asserted that the relief claimed in the Federal Court proceedings, with its broad discretionary content, was fundamentally different from the relief claimed in these proceedings, so that issue estoppels could not arise. However, it is not necessary that the same relief be sought in the two sets of proceedings for there to be an issue estoppel. The test, to repeat the principle in Hoystead v Commissioner of Taxation: see above at [78], is that where: "... 'a fact fundamental to the decision arrived at' in the former proceedings and 'the legal quality of the fact' must be taken as finally and conclusively established." 115In my opinion, the estoppels identified by Barrett J in paras (c) and (d) were each ultimate facts "fundamental to the decision arrived at" and are, therefore, binding on both Claude and GC & Co. The matters referred to in paras (a) and (b) were evidentiary matters that lead to the ultimate findings stated in paras (c) and (d). Those two findings, therefore, are issue estoppels by which Claude and GC & Co are bound. Notwithstanding that this is a narrower conclusion than that reached by Barrett J, the estoppels that I consider are established are sufficient to ground a finding of fraud against Claude. 116It follows that ground 2 of the appeal should be rejected.

Ground 5A: effect of delay on the bringing of the proceedings 117Barrett J rejected Claude's defence based on GC & Co's delay in bringing the proceedings (the laches defence). No appeal has been brought against that aspect of his Honour's judgment. His Honour dealt separately with the question whether a limitation period should be applied by analogy with a common law claim: see Limitation Act, s 23, and if so, what the analogous period was. His Honour, at [239], considered that the claims upon which GC & Co had succeeded warranted an analogy with tort: see The Duke Group Ltd (In liq) v Alamain Investments Ltd [2003] SASC 415; 232 LSJS 58; Aussie Ideas v Tunwind [2006] NSWCA 286. Accordingly, the analogous limitation period was six years: Limitation Act, s 14. 118It should be noted that there may be a question as to whether the application of an analogous limitation period in respect of an equitable claim is an aspect of the law of laches, with the same considerations as apply to that doctrine applying to the application of the analogous period. That question was not raised in this matter and I do not consider that it is appropriate to consider it. But in any event, there are questions here as to the suspension of the analogous time limit which is discussed below. That question would also have arisen as part of an explanation for any delay, if in fact the limitation question is, in fact, an aspect of laches. 119The proceedings were commenced by statement of claim filed on 11 September 2008. Leave to commence proceedings was granted by Sackville AJ on an interim basis on 5 September 2008. His Honour confirmed that leave on 23 September 2008, pursuant to the Corporations Act, s 237. Denis had filed that application on 18 December 2007. Barrett J considered that the background facts leading to the grant of leave were relevant to the determination of the delay defences. Having considered those facts, his Honour concluded, at [206], that the question of delay should be approached as follows: "(a) the board of directors of GC & Co was, at all relevant times, constituted in such a way as to make it impossible, in every practical sense, for GC & Co to commence proceedings against Claude through a decision of the directors; (b) Denis, Patrick, Catherine and John were aware, from at least mid-1997, of all facts relevant to the institution of the proceedings; (c) from mid-1997 to 15 June 1999 (when receivers were appointed) it was open to any one or more of Denis, Patrick, Catherine and John to take steps to initiate a general law derivative action asserting GC & Co's causes of action against Claude; (d) the practical ability of those persons to take such steps came to an end on 15 June 1999; (e) after 21 December 2004, however, it was again open to any one or more of Denis, Patrick, Catherine and John to seek leave under s 237 to bring a statutory derivative action against Claude." 120In relation to Claude's breach of duty involving the Dairy Farm, on his Honour's reckoning, the analogous six year limitation period would have expired on 30 June 2003, having commenced on 30 June 1997, being the date at which he received the advantage of book entries by which the consideration for the transfer of the dairy farm had been satisfied. However, from June 1999 to 21 December 2004, being the period between paras (d) and (e) set out at [119] above, GC & Co was in receivership at the instance of the Commonwealth Bank. His Honour considered, at [205], that during that period the prospect of leave being granted to bring proceedings would have been "very remote". His Honour had noted, at [204], that Sackville AJ had accepted Denis' evidence in the leave application that he had not brought proceedings in this period because he did not think it feasible to do so. 121Barrett J found, at [207], that the operative delay was confined to the period mid-1997 to 15 June 1999 and 21 December 2004 until the filing of the s 237 application on 18 December 2007. As his Honour considered there was no real ability for shareholders to bring an action during the period of the receivership, he considered that that period was akin to "a state of 'disability'" under the Limitation Act, s 11(3). Accordingly, by analogy, his Honour considered that the limitation was suspended during this period: see Limitation Act, s 52. 122When regard was had to this period, his Honour concluded, at [242], that the period between the accrual of the cause of action in June 1997 and the commencement of proceedings was less than six years. Accordingly, any claim relating to Claude's drawing on the loan account for his personal expenses or in cash, was to be treated as not affected by the analogous application of any time bar if they occurred after the day that was 11 years six months and six days before 11 September 2008. This period included the recording in the loan account, on 30 June 1997, the consideration payable for the Dairy Farm.

What was the analogous limitation period and what was the date from which it ran? 123Claude accepted that the trial judge had correctly determined that the analogous limitation period to which regard should be had in accordance with s 23 was the six year period prescribed by s 14. However, he contended that his Honour erred in finding that the relevant date for considering s 23 was immediately after the recording of the relevant book entries relating to the payment for the Dairy Farm. Claude contended that the relevant date at which time began to run was the date that he asserted an entitlement to the $4.25 M from the settlement proceedings. Accordingly, Claude submitted that the claim was statute barred after 6 July 1999, that is, six years after the letter dated 6 July 1993. Alternatively, Claude contended the correct date was 31 October 1999, being six years after the creation of the loan account which occurred no later than 31 October 1993. 124Claude also complained that GC & Co had not argued in the court below that the limitation period had been suspended, so that his Honour should not have found the analogous limitation period did not run during the period of the receivership. 125GC & Co submitted that in circumstances where Claude breached his fiduciary duty on multiple occasions, by drawing upon the account, the appropriate date from which to consider the analogous application of the Limitation Act was the date of each relevant withdrawal. GC & Co also supported the trial judge's approach to the period it was in receivership. 126GC & Co, in its notice of contention, contended that in a case of a fraudulent breach of fiduciary duty, equity would not permit the application, by analogy, of a limitation period. GC & Co referred to Aussie Ideas v Tunwind, at [21], [26]-[27], as authority for the proposition that equity does not allow a fiduciary to plead a limitation defence in circumstances where the plaintiff's assets, controlled by the fiduciary, are misapplied or lost through a breach of duty. As Claude was a voluntary fiduciary, this was an archetypal case for which no limitation analogy would be made: Cohen v Cohen [1929] HCA 15; 42 CLR 91 at 100. 127GC & Co alternatively argued that the relevantly analogous provision applicable to the present proceedings was s 47, which relates to actions involving trusts. GC & Co pointed out that the definition of trustee in s 11 of the Act was inclusive and submitted that Claude had stewardship of the company's assets and thus fell within that definition. GC & Co also relied upon Barrett J's observation, at [236], that: "... [a] company director who takes company assets which the company then sues to recover may be likened to such a trustee. So too may a defaulting director against whom an account of profits is sought, in that the profits should have come home to the company in the first place ..." (citation omitted) 128GC & Co contended that having identified those examples where a director was said to be in a position akin to a trustee, his Honour was in error in finding that this case was different as the claim against Claude was for equitable compensation. GC & Co submitted that in this case where Claude, by using his position as director, had caused company property to be transferred to him and his wife in return for an adjustment in the books, which did not give value to the company, fell within the observations to which his Honour referred. 129It is convenient first to consider the arguments raised on the notice of contention. 130Section 47(1), which appears in Pt 2: "Periods of limitation and related matters"; Div 5: "Trusts", provides: "(1) An action on a cause of action: (a) in respect of fraud or a fraudulent breach of trust, against a person who is, while a trustee, a party or privy to the fraud or the breach of trust or against the person's successor, (b) for a remedy of the conversion to a person's own use of trust property received by the person while a trustee, against that person or against the person's successor, (c) to recover trust property, or property into which trust property can be traced, against a trustee or against any other person, or (d) to recover money on account of a wrongful distribution of trust property, against the person to whom the property is distributed or against the person's successor, is not maintainable by a trustee of the trust or by a beneficiary under the trust or by a person claiming through a beneficiary under the trust if brought after the expiration of the only or later to expire of such of the following limitation periods as are applicable: (e) a limitation period of twelve years running from the date on which the plaintiff or a person through whom the plaintiff claims first discovers or may with reasonable diligence discover the facts giving rise to the cause of action and that the cause of action has accrued, and (f) the limitation period for the cause of action fixed by or under any provision of this Act other than this section. ..." 131"Trust" is defined in s 11 to mean: "... express implied and constructive trusts, whether or not the trustee has a beneficial interest in the trust property, and whether or not the trust arises only by reason of a transaction impeached, and includes the duties incident to the office of personal representative but does not include the duties incident to the estate or interests of a mortgagee in mortgaged property." 132Section 11 also provides that "Trustee" has a meaning corresponding to the meaning of "Trust". 133A company director, albeit owing fiduciary obligations to the company does not, by that circumstance alone, become a trustee. The learned authors in R P Austin and I M Ramsey, Ford's Principles of Corporations Law, 13th ed, (2007), referring to directors and trustees, state, at 8.050: "While both are fiduciaries, it is a characteristic of the trustee's office that property is vested in him or her for the benefit of the cestui qui trust. Normally no property of the company is vested in a director although the directors as a board will have control over the company's property. If property of the company were to be vested in a director, the director would very probably be a trustee of it." 134The question for determination, therefore, is whether the claim for equitable compensation in those circumstances is equivalent to a claim in debt or for fraud, as found by his Honour, or whether it is akin to the case where a person who receives property for another has a duty to hold the property for the other such as to become trustee of that property. 135In the present case, a portion of the settlement monies were credited to the loan account. The legal effect of the loan account was to create the relationship of debtor and creditor as between GC & Co and Claude. In my opinion, that is different from property of the company becoming vested in Claude. Nor did Claude become a trustee of GC & Co's property because of his wrongful crediting of the monies in the loan account. 136Whilst money which has been stolen is trust money in the hands of the thief: see Black & Black v S Freedman & Company [1910] HCA 58; 12 CLR 105, I do not consider that Claude 'stole' money, as such. Rather, by book entry, he misappropriated monies to himself. This view is supported by the well understood notion that stealing can only be of chattels. A contract, for example, cannot be stolen: Whitehorn Brothers v Davison (1911) 1 KB 463 at 480; Creak v James Moore & Sons Pty Ltd [1912] HCA 67; 15 CLR 426 at 432. 137GC & Co is entitled to seek compensation for Claude's wrongful acts in using the loan accounts for his own purpose by way of equitable compensation. However, that does not involve the recovery of trust property. GC & Co's pleaded claim for relief itself recognised this. 138Accordingly, I would reject GC & Co's argument that the analogous limitation provision was s 47. 139GC & Co's alternative argument was that there was no analogous limitation period. In Aussie Ideas v Tunwind Handley JA observed, at [21], that where a person held or controlled assets belonging to another, which were misapplied or lost through a breach of duty, equity would not permit the trustee or fiduciary to plead a limitation defence. His Honour cited Metropolitan Bank v Heiron (1880) 5 Ex D 319 CA and Cohen v Cohen at 99-101 for this proposition. 140In Cohen v Cohen Dixon J, at 100, adopted the following statement of principle from Burdick v Garrick (1870) LR 5 Ch 233: "... where the duty of persons is to receive property, and to hold it for another, and to keep it until it is called for, they cannot discharge themselves from that trust by appealing to the lapse of time." 141Dixon J also referred to Lyell v Kennedy (1889) 14 App Cas 437 at 463, where Lord Mcnaghten, in accepting the proposition stated in Burdick v Garrick as a sound proposition, said: "Nor do I think it can make any difference whether the duty arises from contract or is connected with some previous request, or whether it is self-imposed and undertaken without any authority whatever. If it be established that the duty has in fact been undertaken and that property has been received by a person assuming to act in a fiduciary character, the same consequences must, I think, in every case follow." 142The circumstances in the present case do not entirely fall within the circumstances considered in these authorities. Notwithstanding that Claude received monies belonging to GC & Co in breach of his fiduciary duty to GC & Co, I consider that the loan account created a relationship of debtor and creditor as between GC & Co and Claude. I would, therefore, also reject this argument. 143Barrett J concluded, at [234], that the authorities supported the treatment of the claim here, where a company director who applied company funds for his own use had been found to have acted dishonestly in breaching fiduciary duties owed by him to his company, as analogous to a claim for damages for deceit or conspiracy to defraud. This was not contested by Claude and GC & Co accepted his Honour's approach was correct if it failed on its notice of contention. 144There are a number of comments in the authorities that support his Honour's approach. Thus, in Aussie Ideas v Tunwind, the Court of Appeal, at [22], held that a breach of fiduciary duty with 'elements of dishonesty' warranted analogy with breach of contractual and tortious professional duties. However, in that case, the fiduciary relationship arose in the context of the provision of professional services. 145In The Duke Group v Alamain Investments Doyle CJ, at [133], held that in the case under consideration: "... there are causes of action in tort against the directors sufficiently similar to the claim against the directors for breach of fiduciary duty, and which are subject to a six year time limit, to warrant in principle the application of that time limit to a claim against the directors for breach of fiduciary duty." 146In my opinion, Barrett J, at [235], was correct in treating the claim against Claude as analogous to a claim for damages for deceit or conspiracy to defraud and therefore analogous to a claim in tort. For the reasons I have given, Claude is not be to treated in accordance with the principle in Burdick v Garrick set out at [140] above. It was not Claude's duty to receive the settlement monies and hold them for GC & Co. Rather, he fraudulently credited the loan account in the way that has been discussed. It followed that the relevant analogous limitation period was six years. The question which then arises is when that period commenced and whether there was any period of suspension during which time ceased to run. 147In tort, being the cause of action analogous to the claim brought here against Claude, damage is the gist of the action so that a cause of action does not arise until damage is suffered. His Honour concluded that even though the loan account was false, in the sense I have explained above, there had been no change in GC & Co's asset base. In other words, no monies were in fact owing by GC & Co to Claude. Damage was only sustained when Claude actually appropriated monies belonging to GC & Co, either by way of drawings or by making book entries, including the book entry in relation to the Dairy Farm. Each drawing or debit entry was separate and independent, the only common feature being the reduction in the balance of a loan account that wrongfully had been credited with the sum of $4.25 M. Accordingly, each drawing or debit entry constituted an independent breach of duty. Time began to run, in respect of each breach, from the date of the individual drawing or debit entry. 148Before leaving the question of the date from which the analogous limitation should run, reference should be made to the Limitation Act, s 55. That section provides that time does not commence to run in a cause of action based on fraud or deceit until the person having the cause of action discovers, or should, with reasonable diligence, have discovered the fraud. Although Barrett J did not specifically refer to s 55, he nonetheless approached the matter correctly, as is apparent from his finding, at [206], that Denis, Patrick, Catherine and John were aware at least from mid-1997 of all facts relevant to the institution of proceedings.

Can time be "suspended" during the period of the analogous limitation period? 149As Barrett J observed, at [202], the statutory derivative action procedure in the Corporations Act, s 237 has been available since December 1999. Prior to that, a member would have to comply with the rule in Foss v Harbottle (1843) 2 Hare 461; 67 ER 189. GC & Co was in receivership between 15 June 1999 and 21 December 2004. Barrett J considered at [205], that the prospects of acourt granting leave for a member to bring a derivative action while the company was in that state would be very remote, whether that action be brought at common law or under the Corporations Act. 150His Honour recognised that the role of the normal decision-making organs of a company remained but were effectively superseded for the duration of the receivership. Barrett J referred to Hawkesbury Development Pty Ltd v Landmark Finance Pty Ltd (1969) 92 WN (NSW) 199 where Street J observed, at 209, that: "Receivership and management may well dominate exclusively a company's affairs in its dealings and relations with the outside world. But it does not permeate the company's internal domestic structure. That structure continues to exist notwithstanding that the directors no longer have authority to exercise their ordinary business-management functions." 151His Honour considered, however, that a court would treat the agency and decision-making role of the receivers and their function in serving the interests of the secured creditor as predominant. His Honour also noted, at [240], that the receivers had no duty to pursue claims of the kind involved in these proceedings and may well have been criticised for doing so. 152Claude challenged his Honour's finding. He submitted that if, as the primary judge assumed, the bank's charge attached to the cause of action against Claude and the shareholders could demonstrate that the receivers had failed to bring proceedings, a court would, effectively, be bound to accede to an application by a shareholder under the Corporations Act, s 237 particularly when time was running. Claude submitted that the requirements of s 237(2) were satisfied and that a Court would have given leave to bring proceedings. The Corporations Act, s 237(2) relevantly provides that the Court must grant the application if it is satisfied that: "(a) it is probable that the company will not itself bring the proceedings, or properly take responsibility for them, or for the steps in them; and (b) the applicant is acting in good faith; and (c) it is in the best interests of the company that the applicant be granted leave; and (d) if the applicant is applying for leave to bring proceedings--there is a serious question to be tried ..." 153This submission was at odds with the stance that Claude took in the proceedings under s 237(2) which he resisted: see Denis Cassegrain v G Cassegrain & Co [2008] NSWSC 976; 68 ACSR 132. GC & Co said that having regard to Claude's resistance and the issues in those proceedings it was not a foregone conclusion that a court would have granted leave at an earlier point of time. In the leave proceedings, Sackville AJ, at [72], identified the issues in dispute as being: "(i) The Company submits that Denis is not acting in good faith and thus has not satisfied s 237(2)(b) of the Corporations Act. Among other things, the Company argues that Denis is in truth a nominee of the three siblings who were his co-applicants in the oppression proceedings). It also contends that the real purpose of the proposed proceedings is not to reverse the transactions entered into by the Company, but to pursue 'an ongoing family vendetta against Claude'. (ii) The Company maintains that the proposed proceedings are not in the best interests of the Company and that therefore Denis has not satisfied s 237(2)(c). In particular, the Company says that Denis has not demonstrated that reversal of the impugned transactions will result in an improvement in the Company's commercial position. (iii) The Company submits that Denis has not established that there is a serious issue to be tried in the proposed proceedings and that, accordingly, he has not satisfied the requirements of s 237(2)(d)." 154These issues do not indicate that Claude's opposition to the grant of leave was merely formal. There were significant and difficult issues to resolve. In my opinion, they lend support to Barrett J's conclusion that it was unlikely that leave would have been granted at a time when there was was the added complication that GC & Co was in receivership. In this regard, his Honour was an experienced equity and commercial judge and was in a position to make that determination. Nothing has been indicated, by way of evidence or submission, why that was not so. 155Claude also challenged his Honour's finding in relation to the suspension of time on the basis that GC & Co had not argued this point before the trial judge. GC & Co conceded that it had not done so but submitted that the trial judge's reasoning was sound. 156I consider that it was open to his Honour to find that the period of receivership ought to be ignored for the purposes of determining the expiry of an analogous limitation period. That question arose during the course of determining what the analogous limitation period was and the time at which that period applied. The existence of the receivership during that period was relevant to that determination. It was open to his Honour to infer that it was unlikely that leave would be granted to bring proceedings whilst the company was in receivership and also unlikely that the receivers themselves would have taken on such proceedings as were eventually brought because they had no interest in doing so. Their concern was in protecting the interests of the Commonwealth Bank and the Bank was otherwise paid out without resort to any asset represented by his alleged breach of duty.

Conclusion 157As Claude has failed in respect of each of his grounds of appeal, it follows that the appeal should be dismissed with costs. 158BASTEN JA: Gerard Cassegrain & Co Pty Ltd ("the company") was a family company established in 1960, the members of which, at all relevant times, were the parents and children of the founding shareholders. One of the siblings and managing director of the company after the father's death was Claude Cassegrain, who, with his wife Felicity Cassegrain, held a controlling interest in the company. On 27 September 1993 the company and Claude Cassegrain entered into a Deed of Settlement and Release ("the Deed") with the CSIRO and a jointly owned company, Cassiro Ltd, pursuant to which the CSIRO agreed to pay $9.5 million to or at the direction of "the Cassegrain parties". In late October 1993 an amount of $4.25 million was credited to the loan account of Claude Cassegrain in the company's books. 159On 15 July 1998 in oppression proceedings brought in the Federal Court Davies J made a declaration in the following terms: "The actions of the first respondent, Claude George Renee Cassegrain, in treating the $4.25m loan account with Gerard Cassegrain & Co Pty Ltd as his entitlement to be drawn down at his will, in drawing upon the loan account as he saw fit and in causing the passing of a resolution of directors allowing for the payment of retrospective interest thereon were actions which were oppressive of and unfairly prejudicial to the members of the company." 160On 14 September 1996 Mr Claude Cassegrain, in purported reliance upon his entitlement to the moneys standing to his credit in his director's loan account transferred a dairy farm owned by the company to him and his wife Felicity, for the amount of $1 million, which amount was debited against his loan account. 161On 24 March 2000, Mr Claude Cassegrain transferred his interest in the dairy farm to his wife, Felicity, for a nominal consideration of $1. Each transfer was duly registered. 162On 18 December 2007, Mr Denis Cassegrain, one of the members of the company, sought leave in the Supreme Court to commence a derivative action against Claude and Felicity Cassegrain, in the name of the company, pursuant to s 237 of the Corporations Act 2001 (Cth). That leave was ultimately granted by Sackville AJA, judgment being delivered on 23 September 2008: Denis Cassegrain v Gerard Cassegrain & Co Pty Ltd [2008] NSWSC 976. The statement of claim was filed on 11 September 2008, pursuant to leave granted by consent on 5 September. The relief sought against Claude Cassegrain was equitable compensation; that sought against Felicity Cassegrain was a declaration that she held the land registered in her name on trust for the company absolutely. 163These proceedings were ultimately heard by Barrett J sitting in the Equity Division (Corporations List) in April 2011. On 29 September 2011 Barrett J gave judgment, upholding the claim for equitable compensation against Mr Claude Cassegrain, but declining to grant relief with respect to the diary farm and thus dismissing the proceeding against Felicity Cassegrain: Gerard Cassegrain & Co Pty Ltd v Cassegrain [2011] NSWSC 1156; and [2011] NSWSC 1594 (a further judgment delivered on 20 December 2011 making consequential orders). 164There are two appeals before this Court: one brought by Claude Cassegrain, seeking to set aside the judgment and orders made against him; the other brought by the company seeking recovery of the dairy farm from Felicity Cassegrain. The latter is the subject of a separate judgment. Issues on appeals 165At the commencement of the oral hearing, counsel for the appellant Claude Cassegrain, abandoned all of the grounds set out in the notice of appeal other than grounds 1 and 5A. Ground 1 asserted that the trial judge failed to take into account Claude Cassegrain's entitlement under the CSIRO settlement deed; ground 5A asserted that such entitlement to relief as the company might otherwise have had had been extinguished "by operation of the Limitation Act 1969 (NSW)". However, when the Court pointed out that success on the first ground would not assist if the issue estoppels flowing from the judgment of the Federal Court were not challenged, counsel sought to reinstate reliance on ground 2, which challenged the findings based on issue estoppel. 166So far as ground 1 was concerned, there was a real issue as to whether the settlement deed was relied upon at trial in the way in which it was sought to be relied upon on appeal. However, that issue does not require resolution if the findings made by the trial judge can be supported by estoppels. It is convenient to deal first with that issue (ground 2) and then the limitation point (ground 5A). 167The issues with respect to Felicity Cassegrain relate to the exception to indefeasibility of a registered title to land, where the interest is acquired through fraud. The company's appeal depends in part on the outcome of the appeal by Claude Cassegrain but is addressed separately. Issue estoppel (ground 2) (a) relevant principles 168The change in approach by senior counsel in the course of oral argument did not result in any oral submissions being made with respect to ground 2. Accordingly, it is necessary to extract the substance of ground 2 from the explanation of the ground in the further amended notice of appeal and the written submissions. Both documents are, in this respect, discursive and somewhat disorganised. However, it appears that three points were raised, namely: (a) the subject matter of the two sets of proceedings was fundamentally different; (b) the only relief granted in the Federal Court being a declaration, findings capable of supporting substantive relief could not be relied upon because that relief was not granted; (c) by pleading (illegitimately) in its reply a factual case which did not rely upon issues estoppels, the company had waived any entitlement to rely upon issue estoppel. 169It is convenient to deal with point (c) first: it lacks merit. As senior counsel for the company noted, to suggest that a claimant cannot plead a case in the alternative is a "nonsense". First, there is no need to elect between reliance on estoppels and, in the alternative, pleading the underlying facts. No doubt where claims of issue estoppel are relied upon, it may well be good practice to dispose of those claims before embarking on a lengthy trial based on oral evidence. However, that issue did not arise in this case because neither party sought to call oral evidence. Secondly, the suggestion that the reply illegitimately expanded the claims made in the statement of claim was also without merit. The elements of the cause of action did not change: rather, in the face of a denial that findings could be made by way of issue estoppel, the same elements were sought to be established by proof of facts underlying the findings made in the Federal Court. Even were that not so, the case having been run on the basis of the pleadings, to which no objection was taken at or prior to trial, the complaint is without substance. 170The two points identified as (a) and (b) are not entirely consistent. At trial, they were combined with the proposition that the relief now sought by the company should have been sought in the proceedings in the Federal Court. That not having happened, it was now too late for the company to raise those issues, in accordance with the principles of estoppel enunciated in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; 147 CLR 589 - see appellant's defence, par 33. That proposition was not relied on in the appeal. 171The difference in the nature of the two sets of proceedings was explained by the trial judge at [48]-[52]. The proceedings in the Federal Court alleged not a wrong to the company, but oppressive conduct by a director in control of the company imposing a disadvantage or burden on certain members of the company. Barrett J referred to the statement of Brennan J in Wayde v New South Wales Rugby League Ltd [1985] HCA 68; 180 CLR 459 at 472 that "if the directors exercise a power - albeit in good faith and for a purpose within the power - so as to impose a disadvantage, disability or burden on a member that, according to ordinary standards of reasonableness and fair dealing is unfair, the Court may intervene under s 320 [of the Companies (New South Wales) Code]". This passage reflected an earlier statement that for conduct to be oppressive to members of a company, it was once thought necessary that it be "burdensome, harsh and wrongful": Scottish Co-operative Wholesale Society Ltd v Meyer [1959] AC 324 at 342 (Viscount Simonds), referred to in Wayde at 471. The current statutory provision, as Brennan J noted, did not require that the conduct be wrongful or made in bad faith. However, as Brennan J also stated at 469-470: "If the decision is such that no reasonable board of directors could think the decision to be substantially for a purpose for which the power was conferred, the court may infer that the directors did not make the decision in good faith for a purpose within the power and intervene on that ground ..." 172Thus, whilst lack of good faith could be a basis for finding oppression (as it was in this case) the appellant argued that the finding was made for a different purpose, namely to ground a conclusion that an act was oppressive towards members of the company, rather than a wrong to the company itself. But if that were correct, nothing turned on the relief which was refused (namely an order winding up the company), that refusal being based upon the unwillingness of the applicants in the Federal Court (principally Denis Cassegrain) to seek the winding up of other companies in the group. (Davies J explained the structure of the group, parts of which were flourishing whilst other parts were not. Although he was inclined to think that some degree of restructuring of the control of the companies was desirable, he made no orders in that regard. Orders of the kind sought in the present proceedings were not agitated before the Federal Court.) 173No doubt a party cannot rely on a supposed estoppel based on a finding which was inconsistent with a refusal of particular relief, but that situation did not arise. Nor is the nature of the relief sought critical: if it were there would be a res judicata. Accordingly, to the extent that the appellant sought to pursue its challenge to the findings said to be supported by issue estoppels, it is necessary to address those findings relied on by the trial judge which were said to be "legally indispensable" to the conclusions reflected in the order made in the Federal Court: Blair v Curran [1939] HCA 23; 62 CLR 464 at 531-532 (Dixon J). (b) validity of estoppel findings 174To consider the correctness of the reliance placed by the trial judge on findings made in the Federal Court, it is convenient to refer back to the declaration set out at [159] above. 175Claude Cassegrain did not appeal from the judgment of the Federal Court. The critical question is not, however, the effect of the declaration, but the findings on which it was based. The trial judge set out at [58] the matters which were said to be necessarily decided by the Federal Court, in a submission which he upheld at [64], in the following terms: "(a) that the division of the $9.5 million settlement proceeds between Claude and GC& Co was agreed by Claude and Gerard for the sole purpose of reducing capital gains tax liability of GC & Co on those moneys; (b) the $9.5 million was paid to GC & Co and received by it in settlement of its claim against CSIRO and no attempt was ever made genuinely to estimate a sum for any personal claim by Claude; (c) when the purported division was agreed in July 1993, neither Gerard nor Claude regarded the $4.25 million as Claude's money; and (d) the purported division did not impose on GC & Co any obligation to pay Claude any part of the $4.25 million." 176The trial judge set out a lengthy extract from the reason of Davies J at [46]. The paragraphs were numbered by the trial judge (though not in the original) and it is convenient adopt the references in the judgment of Barrett J. The first step in the reasoning on issue estoppel requires reference to the statement of Davies J in which he indicated his reliance upon the way in which the settlement moneys were used by Claude Cassegrain. In a passage identified as [18] by the trial judge, Davies J stated: "Counsel for Claude has submitted that I should not enter into the issue as to whether Claude's actions in relation to the $4.25m loan account amounted to oppressive conduct. Counsel submitted that the matter was not raised in any formal application which had been filed and that, if it had been raised, other witnesses such as the mediator and counsel may have been called. In my opinion, all counsel in these proceedings were ultimately content to proceed without arguing about amendments to the formal application and this particular issue was clearly raised and litigated. In my view, all appropriate witnesses were called and all relevant documents are before the Court." There was no challenge to this statement in this Court. 177The critical findings appeared on the following passages in the judgment of Davies J: "[12] Claude has given evidence that he considered the $4.25m to be his fair share of the settlement and that he could not recall discussing any issue of capital gains tax with Claude Griffith [the company's accountant] or with his father [Gerard]. I reject Claude's evidence on these matters and also that of Mrs Cassegrain [Claude's mother]. I am satisfied that the split was agreed to between Claude and his father with a view to reducing the capital gains tax otherwise payable on the $9.5m. I am satisfied that Gerard [the father] and Claude did not at the time regard the sum of $4.25m as Claude's money. In Gerard's lifetime, expenditure from loan accounts did not occur without his approval. Claude could not have drawn down the $4.25m unless his father had agreed to that course. And except as to legal expenses and perhaps other like matters, he did not do so during his father's lifetime. I am satisfied that the $9.5m was paid to GC & Co and received by it in settlement of its claim against CSIRO and that no attempt was ever made genuinely to estimate a sum for any personal claim by Claude including any claim falling within the terms of s 160ZB(1) [of the Income Tax Assessment Act 1936 (Cth)]. [13] Since Gerard's death, Claude has drawn upon the funds of GC & Co both by way of regular living expenses of $3,000 per month and for other personal expenses such as school fees. These sums have been debited to the loan account. These actions were wrong. ... [14] In like vein, Claude purchased a property from GC & Co which was a dairy farm and residence. The purchase price, which amounted to a total of $1.3m approx, was paid by debiting the $4.25m. This was not a transaction of which the approval of the shareholders was sought, Claude taking the view that the $4.25m was his and, furthermore, that he was entitled to receive a home as he has had to sell a home to support GC & Co during the time of its worst financial difficulties. More recently, Claude has had a swimming pool constructed at his home and has debited the cost to the loan account. [15] Furthermore, during the interregnum between two hearings of these proceedings, the directors of GC & Co, Claude and Anne-Marie, resolved ... that the $4.25m had been lent in 1993 on terms as to reasonable interest which Claude was entitled to claim should he choose to do so. This resolution, of course, had no justification whatever. I am satisfied that there was never any agreement between Claude and GC & Co with respect to the payment of interest on the $4.25m. I am satisfied that neither Gerard nor Patrick ... looked upon the $4.25m as Claude's money, nor had any conversation with Patrick with respect to interest. [16] Claude's actions in arranging for the purported division of the $9.5 into $5.25m for GC & Co and $4.25m for Claude, his drawing upon that sum at his will as if it were his entitlement to do so and his arranging for the passing of the resolution which made provision for the payment of retrospective interest was exemplary of oppressive behaviour. It is a very plain illustration of conduct by a person who, in practical control over the affairs of a company, has acted to benefit himself to the detriment of the other persons who are interested in the company. The mere purported division of the $9.5m may not, of itself, have amounted to oppressive conduct for it was a step taken to reduce the tax liability of the company. It was the subsequent use of the money by Claude as if it were his own and the pretence that there had been some agreement for the payment of interest thereon which constituted oppression of the other shareholders." 178The trial judge set out in summary form the findings which were made in these paragraphs, at [61], continuing at [63]: "Necessarily implicit in these findings, however, is a further finding, namely, that the $4.25 million was not Claude's to deal with as he wished and, therefore, that the so-called loan account was not a loan account at all, in the ordinary sense of a reflection of the company's obligation to pay without question as and when payment was demanded." 179The trial judge identified the particular passages in the reasons, particularly at [12] and [15], which supported that conclusion. By referring to the "so-called loan account" he should be understood as referring, not to the account as such, which predated the crediting of $4.25 million, but the account as constituted by that sum. 180The appellant's written submissions in this Court sought to rework the findings of Davies J to show that they did not support the finding of fraud made by the trial judge. Those submissions were not developed orally. However, the finding that the amount of $4.25 million was paid into the loan account "for the sole purpose of reducing capital gains liability of [the company]", the finding that Claude Cassegrain did not regard the money as his own, together with the finding that the company did not owe him that amount, support the inference that in treating the money as his own, Claude Cassegrain acted fraudulently. The findings of Davies J constituted a sufficient basis, by way of issue estoppel, to justify the conclusion reached. (c) reliance on original evidence 181The trial judge also analysed the original evidence (entirely in documentary form, Claude Cassegrain not having given oral evidence) and reached the same conclusion. He stated at [119]: "I have said that Claude is, in these proceedings, bound by the findings (a) to (d) at paragraph [58] above. Those findings are, in any event, fully supported by the evidence in this case. In particular, the manoeuvrings of GC & Co (at the instigation of Claude) in the tax proceedings as to the basis on which Claude was somehow entitled to $4.25 million of the CSIRO settlement proceeds show that the original pretext of compensation for damage to reputation was simply an invention by Claude. When it suited him at a later stage to do so, he made compensation for unpaid remuneration and lost income the predominant element of the justification for the allocation of $4.25 million to him. The element for compensation for damage to reputation was, at that later time, said by Claude to be a mere $500,000. It is beside the point that it was found in the tax proceedings that some part of the settlement moneys was attributable to Claude. He relied solely on the supposed entitlement to $4.25 million for defamation as justification for establishing the loan account. Once it is seen that that particular entitlement was illusory and non-existent, the justification is illusory and non-existent also." 182An express finding was made in relation to his state of mind in the following terms: "[127] Furthermore, the evidence shows that Claude acted dishonestly in this respect. He never had any genuine or objectively based belief that the settlement moneys included $4.25 million for him as compensation for defamation. He knew that CSIRO had not agreed to any such apportionment. The apportionment was adopted so as to create a false position from which to argue that GC & Co's assessable capital gain was $5.25 million rather than $9.5 million. In the subsequent tax proceedings, it was Claude who, with an eye to a different tax advantage, seized upon supposed allocations of the settlement moneys as a whole that were entirely at odds with the line he had taken in 1993. His subsequent adoption of those alternatives underscores his lack of genuine belief in the original story regarding compensation for defamation. ... [129] It follows that, on each occasion on which Claude obtained money or value from GC & Co which reflected in a reduction of the loan account balance, he acted not only in breach of fiduciary duty but also dishonestly. It is therefore correct to categorise his conduct as dishonest or fraudulent breach of fiduciary duty. It went beyond the pleaded alternative of recklessness." 183Apart from the assertion, discussed above, that it was not open to the company to seek to rely upon issue estoppels and, in the alternative, to rely upon the original documentation and evidence to support the same findings, there was no serious challenge to these conclusions. Ground 2 has not been made good. Reliance on Deed (ground 1) 184To the extent that ground 1 separately alleged a failure on the part of the trial judge to have adequate regard to the deed between the company, and Claude Cassegrain on the one hand, and CSIRO on the other, (a complaint which assumed that the trial judge was not only entitled, but required, to look to the primary materials) the claim was not made good. The trial judge referred to the deed and the surrounding circumstances at [84]-[89]. However, as the appellant recognised, the deed made no provision for apportionment of the larger sum of $8.8 million; nor did the surrounding circumstances demonstrate that the deed supported an allocation of $4.25 million to Claude Cassegrain for his unpleaded claim in defamation. The submissions failed to articulate any basis upon which it could be said that the trial judge misunderstood the deed or failed to draw some inference which should have been drawn. Ground 1 was without substance. Limitation Act (ground 5A) (a) issues 185The defence filed by the appellant alleged that whatever the relief to which the company may have otherwise been entitled in respect of his breach of fiduciary duties as a director, the cause of action had been extinguished by operation of ss 14 and 63 of the Limitation Act 1969 (NSW): par 31(a). He also pleaded that any entitlement to equitable relief should be refused, applying s 14 by analogy, in conformity with s 23 of the Limitation Act, par 31(c). He further relied upon laches, acquiescence and delay: par 32. 186The proceedings were commenced on 11 September 2008. If a six year period applied, without suspension, any cause of action accruing prior to 12 September 2002 would have been extinguished; if a 12 year period applied, the result followed only in respect of causes of action which accrued prior to 12 September 1996. 187The trial judge found that no cause of action accrued in 1993, merely by establishing a loan account with a credit of $4.25 million, because the company was not deprived of funds. Rather, the company was deprived of its assets when Claude Cassegrain drew upon the loan account without authority in purported payment for the dairy farm owned by the company. The primary drawing was the transfer of the dairy farm to himself and Felicity Cassegrain, which was paid for by a debit to the loan account recorded on 30 June 1997. That was approximately 11 years and 3 months before the commencement of the proceedings against him. 188The trial judge held that because the claim was for equitable compensation, the provisions of the Limitation Act did not apply otherwise than by analogy: Limitation Act, s 23. He further held that the appropriate analogous period was the six year period provided by s 14, which covered causes of action founded in tort. He also held, by analogy with s 52, that the limitation period ceased to run from the appointment by the Commonwealth Bank of receivers and managers of the company on 15 June 1999, until the termination of the receivership on 21 December 2004. Once the period of suspension of five years six months was taken into account, the proceedings were instituted in time for the company to claim a cause of action based on the payment for, and transfer of, the dairy farm. The basis of the analogy was said to be that during that period, the company was "substantially impeded in the management of its affairs in relation to the cause of action by reason of an impairment of its physical or mental condition or by a state of affairs equivalent to restraint upon its person": see definition of "person under a disability" in s 11(3). 189The appellant complained that no submissions had been put before the trial judge in support of this basis for dismissing the defence. The company accepted that this was so, but nevertheless maintained that the reasoning of the trial judge was correct. 190By notice of contention, the company further submitted that the trial judge was in error in rejecting an alternative basis for the same conclusion, namely that the relevant provision in the Limitation Act was s 47, which provided a limitation period of 12 years with respect to an action based on fraud or fraudulent breach of trust, against a trustee, or to recover trust property or money on account of a wrongful distribution of trust property. The trial judge rejected the application of s 47, apparently on the basis that a company director may have owed fiduciary duties to the company, but did not fall within the definition of "trustee" in s 11(1): at [228]. Having rejected the operation of s 47 in the circumstances of the case, the trial judge did not consider the possibility that it might operate by analogy, in circumstances to which it did not specifically apply. (b) operation of s 47 191The appropriate course is to consider first the operation of s 47 of the Limitation Act, which is in the following terms: 47 Fraud and conversion; trust property (1) An action on a cause of action: (a) in respect of fraud or a fraudulent breach of trust, against a person who is, while a trustee, a party or privy to the fraud or the breach of trust or against the person's successor, (b) for a remedy of the conversion to a person's own use of trust property received by the person while a trustee, against that person or against the person's successor, (c) to recover trust property, or property into which trust property can be traced, against a trustee or against any other person, or (d) to recover money on account of a wrongful distribution of trust property, against the person to whom the property is distributed or against the person's successor, is not maintainable by a trustee of the trust or by a beneficiary under the trust or by a person claiming through a beneficiary under the trust if brought after the expiration of the only or later to expire of such of the following limitation periods as are applicable: (e) a limitation period of twelve years running from the date on which the plaintiff or a person through whom the plaintiff claims first discovers or may with reasonable diligence discover the facts giving rise to the cause of action and that the cause of action has accrued, and (f) the limitation period for the cause of action fixed by or under any provision of this Act other than this section. (2) Except in the case of fraud or a fraudulent breach of trust, and except so far as concerns income converted by a trustee to his or her own use or income retained and still held by the trustee or his or her successor at the time when the action is brought, this section does not apply to an action on a cause of action to recover arrears of income. 192The following definitions are to be found in s 11(1): 11 Definitions (1) In this Act, unless the context or subject matter otherwise indicates or requires: ... Trust includes express implied and constructive trusts, whether or not the trustee has a beneficial interest in the trust property, and whether or not the trust arises only by reason of a transaction impeached, and includes the duties incident to the office of personal representative but does not include the duties incident to the estate or interests of a mortgagee in mortgaged property. Trustee has a meaning corresponding to the meaning of "trust". 193While the relief claimed against Claude Cassegrain was not recovery of trust property (which he no longer held), but equitable compensation, s 47 is not limited to claims to recover trust property. The findings accepted above involve Claude Cassegrain, as director of the company, acting to obtain the property of the company in breach of his general law fiduciary duties and his duties under the Corporations Act. Whilst the property was in his hands, it was held by him as a constructive trustee for the company: Keith Henry & Co Pty Ltd v Stuart Walker & Co Pty Ltd [1958] HCA 33; 100 CLR 342 at 350; Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; 156 CLR 41 at 107-110 (Mason J). The fact that the trust arose by reason of the transaction impeached did not take it outside the terms of s 47, as explained in the definition of "trust" set out above. The beneficiary of the trust is the company. As s 47 applies not merely to an action to recover trust property but also one for a remedy of the conversion of the property and to recover money on account of a wrongful distribution of trust property, it has application in the present case against Claude Cassegrain as a constructive trustee of the property upon transfer. The appellant did not explain why this line of reasoning was erroneous: in the absence of such a submission, the limitation period of 12 years applied, running from the date (on or about 30 June 1997) when the discontented shareholders discovered the facts from which the misappropriation could be discovered. The proceedings were commenced in time. 194If, for any reason the foregoing analysis is flawed, and s 47 does not apply in its terms, it remains the statutory provision closest in kind to the circumstances of the case and should apply by analogy. No reliance in this Court was placed on the separate defences of laches and acquiescence. (c) suspension of period 195This conclusion on the point of contention renders it unnecessary to consider the validity of the approach adopted by the trial judge. Accepting that the receivers had no duty to recover assets beyond those necessary to meet the amounts owing to the secured creditor, there was a lack of information as to whether the dairy farm fell within the terms of the security (in which case the receivers could have pursued the claim, not being under the control of Claude Cassegrain) and as to why, if it did not, a derivative action brought by the present applicants would not have obtained leave from the Court whilst the receivers were in place. Conclusion 196The analysis at trial (and indeed the submissions before this Court) omitted consideration of the appropriate relief which might be granted against Claude Cassegrain in the event of the company being successful in relation to Felicity Cassegrain. That omission was understandable in the analysis of the trial judge, because he concluded that no relief could be obtained against her. The parties did not submit that the orders in this appeal depended on the outcome of the appeal by the company in relation Felicity Cassegrain. Accordingly, the appropriate orders in this matter are: (1) Dismiss the appeal. (2) Order the appellant to pay the respondents' costs of the appeal. 197MACFARLAN JA: I agree with Beazley P as to the orders that should be made in this appeal. Subject to what follows, I also agree with her Honour's reasons.

Proof of fraud 198For the reasons given by them, I agree with Beazley P and Basten JA that the findings of Davies J in the Federal Court proceedings gave rise to issue estoppels which justified the primary judge's conclusion that Claude acted "not only in breach of fiduciary duty but also dishonestly" and was therefore liable to pay equitable compensation to the company (at [115] and [180]). I agree with Beazley P that the relevant findings were findings (c) and (d) described in [84] of her Honour's judgment. These were of ultimate facts that were legally indispensable to Davies J's conclusions. Those findings thus gave rise to issue estoppels whereas those identified in (a) and (b) did not, because they concerned only evidentiary facts (Blair v Curran [1939] HCA 23; 62 CLR 464 at 532 - 3). 199I also agree, for the reasons they give, with Beazley P and Basten JA's conclusions that Claude's fraud was in any event proved by the evidence before the primary judge, independently of the issue estoppels that the company relied upon (at [106] and [181]-[183]).

Whether time barred 200I agree with Basten JA that, for the reasons he gives, the company's claim against Claude was not time barred by the Limitation Act 1969, or an equitable analogy to any provision of it (at [193]-[194]). It follows that I disagree with Beazley P's reasoning in this respect (at [123]-[146]). 201However, I do agree with Beazley P that the primary judge was in any event correct to conclude that any relevant limitation period was suspended during the period of the company's receivership (at [156]). The result is that its claim was, for this additional reason also, not time barred.

Conclusion on appeal 202I thus consider that Claude's appeal should be dismissed.

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