Timbercorp Finance Pty Ltd v Collins and Tomes [2016] VSCA 128

PRACTICE AND PROCEDURE - Part 4A of the Supreme Court Act 1986 - Managed investment schemes - Collapse of schemes - Group proceeding on behalf of investors in schemes - Defendants include lender to investors - Dismissal of group proceeding - Opt out provisions - Subsequent recovery proceedings by lender against group members - Group members had not opted out of group proceeding - Group members raised individual claims and defences in recovery proceedings - Whether failure to opt out of group proceeding precluded group members from raising individual claims and defences in recovery proceedings.

STATUTORY INTERPRETATION - Group proceedings - s 33Q of the Supreme Court Act 1986 - Whether group members entitled to participate in group proceeding - Whether group members can raise questions not common to group proceedings - Whether failure to raise questions not common in group proceeding precludes group members from raising those questions in subsequent proceedings.

PRACTICE AND PROCEDURE - Group proceedings - Anshun estoppel - Test - Whether unreasonable of group members not to have raised individual claims and defences during group proceeding - Whether group members estopped from raising individual claims and defences in subsequent proceedings by reason of failure to raise individual claims and defences in the group proceeding - Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589.

PRACTICE AND PROCEDURE - Estoppel - Anshun estoppel - Scope of principle - Whether Anshun estoppel may preclude a person who was neither a party nor a privy of a party in an earlier case - Whether unreasonable not to have raised cause of action in earlier proceeding - Relevant factors - Content of opt out notice in group proceedings - Whether respondents estopped from raising matters in subsequent proceedings.

PRACTICE AND PROCEDURE - Estoppel - Anshun estoppel - Privity of interest - Parties and their privies - Whether group members privies of plaintiff in initial group proceeding - Whether plaintiff in group proceeding would be precluded from raising claims and defences of individual group members in subsequent proceedings.

PRACTICE AND PROCEDURE - Group proceedings - Abuse of process - Failure of plaintiff or group members to raise individual claims in group proceeding - Whether raising individual claims and defences by group members in subsequent proceedings is oppressive or brings administration of justice into disrepute.

For the Applicant in S APCI 2015 104 and S APCI 2015 105

Mr A C Archibald QC with Mr D J Batt QC and Dr C O H Parkinson

1 The applicant, Timbercorp Finance Pty Ltd (in liquidation) ('Timbercorp Finance'), was a member of the Timbercorp Group of companies. Timbercorp Ltd was the parent company. The other main member of the group was Timbercorp Securities Ltd (in liquidation) ('Timbercorp Securities'), which was the responsible entity for relevant Timbercorp investment schemes.

2 Between 1992 and its collapse in 2009, the Timbercorp Group invested more than $2 billion in agribusiness projects on behalf of some 18,500 investors. After the introduction of pt 5C.1 of what was then the Corporations Law (Cth) in 1998,[1] these investments were developed pursuant to managed investment schemes. Many investors, including the respondents in the present proceedings, Douglas James Collins and Janet Ann Collins, and John Charles Tomes, borrowed moneys from Timbercorp Finance to finance their investments in the schemes.

3 On 23 April 2009, Mark Anthony Korda and Craig Peter Shepard, partners of KordaMentha, were appointed administrators of the Timbercorp Group companies.

4 On 29 June 2009, the Timbercorp Group's creditors resolved to wind up the companies, and the administrators became liquidators. At the time the Timbercorp Group collapsed, Timbercorp Finance's loan book had over 14,500 outstanding loans to over 7500 borrowers totalling $477.8 million, including loans to Mr and Mrs Collins and Mr Tomes.

5 In the six months following the date on which administrators were appointed to the Timbercorp Group companies:

(a) borrowers under approximately 8470 Timbercorp loans (totalling approximately $243 million) failed to meet their loan repayment obligations;

(b) Timbercorp Finance notified the borrowers for each of those loans that they had failed to meet repayment obligations and that they were in default of their loan obligations; and

(c) Timbercorp Finance issued final demand notices to borrowers in respect of approximately 1480 of those loans.

6 In June 2009, Timbercorp Finance commenced proceedings against 20 defaulting borrowers to recover loan moneys.

7 On 27 October 2009, a proceeding was commenced pursuant to pt 4A of the Supreme Court Act 1986 ('the Act') by Allen Rodney Woodcroft-Brown as plaintiff on his own behalf and on behalf of group members as defined ('the group proceeding'). The definition of 'group members' was complex but, in substance, it extended to those persons who had an interest in a managed investment scheme in which Timbercorp Securities was the responsible entity. The defendants to the group proceeding were Timbercorp Securities, Timbercorp Finance, and various directors of those companies. The statement of claim in that proceeding was amended several times. In large part, the allegations in the statement of claim related to deficiencies in the various product disclosure statements issued in respect of the schemes. Eventually, the plaintiff proceeded to judgment on his sixth further amended statement of claim, which was filed on 14 April 2011. On 1 September 2011, Judd J delivered judgment in the group proceeding.[2] On 27 October 2011, he made final orders dismissing the group proceeding.

8 On 10 October 2013, the Court of Appeal dismissed an appeal from the judgment and orders made by Judd J.[3] An application for special leave to appeal to the High Court was refused.[4]

9 Subsequently, Timbercorp Finance commenced separate proceedings against Mr and Mrs Collins and Mr Tomes in which it sought recovery of outstanding principal and interest on the moneys that it had lent them ('the recovery proceedings'). Neither Mr and Mrs Collins nor Mr Tomes had opted out of the group proceeding. However, each sought to defend their respective recovery proceeding on various bases including (a) that no loan had been advanced to them and that they did not acquire an interest in the project relevant to them (in the case of Mr and Mrs Collins) and (b) that it had been represented that, in the event of default under a loan agreement, Timbercorp Finance's only recourse would be against the investment in the scheme (in the case of Mr Tomes).

10 In response, Timbercorp Finance pleaded that each respondent was precluded from raising the pleaded defences by reason of the fact that they were a group member in the group proceeding. In effect, Timbercorp Finance contended that each of the respondents is subject to the estoppel described in Port of Melbourne Authority v Anshun Pty Ltd[5] ('Anshun estoppel'). In addition, it contended that each of their defences should be stayed as an abuse of process. In the event, the Court (Judd J) ordered that the question whether the respondents were precluded from raising any and, if so, what defences pleaded by them by reason of their participation as group members in the group proceeding be determined as a preliminary question pursuant to r 47.04 of the Supreme Court (General Civil Procedure) Rules 2005.[6] A hearing on this preliminary question was held before a judge of the Trial Division.

11 On 2 September 2015, the primary judge held that the respondents were not precluded either by Anshun estoppel or by the principles of abuse of process from raising any of the defences pleaded to the claims of Timbercorp Finance in either proceeding.[7] In reaching that conclusion, he held that, in a proceeding under pt 4A, the only issues that could be determined were the questions of law or fact that were common to the plaintiff and all the group members.

12 Timbercorp Finance has applied for leave to appeal against the order of the primary judge. In summary, for the reasons set out below, we have reached the following conclusions which are sufficient to dispose of the application for leave to appeal.

13 The only essential conditions that must be satisfied for the commencement of a group proceeding are those contained in s 33C(1) of the Act; if those conditions are met, there is nothing to prevent plaintiffs from raising issues for determination in which they have no interest. Further, the Court has power to permit any group member to draw 'remaining questions' to its attention pursuant to s 33Q(1). A group member may be 'Anshun estopped' only if it was unreasonable for him or her not to have raised, during the group proceeding, some claim other than the common questions of law or fact. However, it does not follow that the failure by a group member to opt out and/or to use s 33Q to draw the Court's attention to any claim that is peculiar to that group member means that the group member will be automatically precluded from raising that claim in later proceedings. While pt 4A expressly provides for a statutory estoppel in respect of any determination of the common questions of law and fact, it does not provide for any estoppel in respect of claims peculiar to a group member that were not advanced in the group proceeding. Whether there will be an Anshun estoppel depends upon a 'merits-based' assessment taking into account all the circumstances of the case. The respondents are not to be taken as having abandoned their individual defences by reason of not having raised them in the group proceeding, or not having opted out of the group proceeding. Finally, estoppels may bind parties and their privies. However, the group members were not privies of the plaintiff in respect of their unpleaded claims and defences and are not to be taken as having abandoned their individual defences by reason of the plaintiff not having raised them as claims in the group proceeding.

14 In the present case, the respondents are not precluded from advancing their individual defences. Accordingly, although we would grant leave to appeal in each proceeding, the appeals should be dismissed.

15 On 12 June 2008, Mr and Mrs Collins applied to Timbercorp Finance for a loan of $51,300 for the acquisition of 10 grove lots in what was known as the 2008 Olive Early Project, being a registered managed investment scheme operated by Timbercorp Securities. The loan amount was 90 per cent of the total cost of the lots, with Mr and Mrs Collins having themselves paid a 10 per cent deposit of $5700 to Timbercorp Securities. On 15 June 2008, Timbercorp Securities advised that Mr and Mrs Collins's application for the lots was accepted. Mr and Mr Collins also received a letter of acceptance of their application for finance dated 15 June 2008.

16 Timbercorp Finance alleges, inter alia, that, on or about 30 June 2008, the loan amount of $51,300 under loan agreement L0026087 in respect of this project was paid to Trust Company of Australia Ltd as custodian and agent for Timbercorp Securities and that Timbercorp Finance, thereby, made a loan to Mr and Mrs Collins in accordance with the terms of the loan agreement.

17 On or about 1 July 2009, Timbercorp Finance alleges that Mr and Mrs Collins defaulted under the loan agreement.

18 On or about 8 May 2008, Mr Tomes applied to Timbercorp Finance for a loan in the amount of $994,410 to fund part of the cost of his initial investment in another registered managed investment scheme operated by Timbercorp Securities, known as the 2007 Almond Post June Project, as well as in the 2008 Olive Early Project.

19 Timbercorp Finance alleges, inter alia, that, on or about 30 June 2008, the loan amount under loan agreement L0025296 in respect of these projects was paid to the custodian and agent for Timbercorp Securities and, thereby, Timbercorp Finance made a loan to Mr Tomes in accordance with the terms of that loan agreement.

20 On or about 31 October 2008, Mr Tomes applied to Timbercorp Finance for a further loan in the amount of $247,545 to fund the payment of loan fees, management costs, rent and other amounts owing by him and relating to his investment in the two projects.

21 Timbercorp Finance alleges, inter alia, that on or about 31 October 2008, the loan amount under a further loan agreement L0028248 was paid to Timbercorp Securities and, thereby, Timbercorp Finance made a loan to Mr Tomes in accordance with the terms of that loan agreement.

22 Timbercorp Finance says that Mr Tomes defaulted under both loan agreements on or about 1 July 2009.

23 On 13 May 2009, Macpherson + Kelley ('M+K'), solicitors, published a circular to investors in Timbercorp managed investment schemes. The circular said, among other things:

Macpherson + Kelley has a strategy which would provide welcome relief, especially for growers who took out loans from Timbercorp Finance Pty Ltd in 2008 (and possibly even in 2007). The strategy will allow you to hold on to your cash that you would otherwise be using to meet repayments on those loans.

The strategy is based on the failure of Timbercorp Securities Limited to disclose to growers the extremely poor financial position of the Timbercorp Group. By law the Responsible Entity should have told growers of the parent companies' having already been in default under bank covenants at the time the Timbercorp invoices were sent to growers.

If you want to take advantage of this offer, Macpherson + Kelley would write letters on your behalf to the Timbercorp Administrators, KordaMentha. The letters would press your claims against Timbercorp Securities Limited and Timbercorp Finance Pty Ltd, relying on specialist areas of law dealing with joint venture agreements, trade practices legislation, the Corporations Act and the Australian Securities and Investments Commission Act.

Expected benefits of pursuing your legal rights

• You could lawfully withhold making any loan repayments to Timbercorp Finance Pty Ltd while claims are processed
• You would assert a right to be repaid all money you have already paid under the loans you obtained in 2008
• To the extent you paid the 2008 invoices from your own money you would assert a right to be refunded that money
• The Timbercorp Administrators would be asked to pass on your claims to the company's insurers
• You will have an immediate, ready answer and line of defence to resist any attempt by debt collectors to recover payment arrears and penalties from you. The Administrators have already sent out letters of demand
• You can put to better use the money you would save by not having to keep up payments to Timbercorp Finance Pty Ltd.

To take advantage of this offer

...

1. A cheque to cover the reading of your documents and the preparation of two separate comprehensive letters of demand to be sent on your behalf to the Administrators of the two relevant Timbercorp companies.

Your cheque should be made payable to Macpherson + Kelley Trust Account in the amount of $275 (including GST).

24 In or about June 2009, KordaMentha received correspondence from M+K on behalf of numerous persons and entities who had invested in Timbercorp schemes and who had entered into loans with Timbercorp Finance.

25 On or about 9 June 2009, M+K issued a further circular to managed investment scheme investors advising, among other things, that: (a) M+K were sending batches of letters of demand on behalf of each of their numerous clients in the matter; (b) these letters would allow investors to ignore any formal demand notices received from KordaMentha; (c) investors receiving demands for payment or threats in relation to legal action or reports to credit reference agencies should tell Timbercorp staff that they were being represented by a lawyer who was writing to KordaMentha about the matter; and (d) legal grounds existed for not making further payments, especially in respect of loans obtained in 2008, and perhaps earlier.

26 On 12 June 2009, Mr and Mrs Collins gave authority to M+K to act on their behalf to pursue rights and remedies against the Timbercorp Group. The formal retainer, signed 18 September 2009, provided that M+K would 'represent [Mr and Mrs Collins's] interests when dealing in the first instance with the issues common to all participants in the class action and then with [their] unique issues within the framework of the class action'. At the time of the group proceeding, Mr Collins was not aware of any individual investor issues concerning himself and Mrs Collins that were not covered by the common questions in the group proceeding. Mr Collins therefore did not take any steps to opt out.[8]

27 On 17 June 2009, M+K wrote to KordaMentha advising that they acted on behalf of Mr Collins as trustee for the D & J Consulting Superannuation Fund. In that letter, M+K said that Mr Collins had suffered or was likely to suffer loss or damage by reason of the failure of Timbercorp Securities to make appropriate disclosure of its true financial position and by reason of contraventions of the Trade Practices Act 1974 (Cth). In addition, the letter made claims based on s 601FC of the Corporations Act 2001 (Cth) ('Corporations Act'). The letter requested that Timbercorp Finance refrain from any recovery action.[9]

28 On the same day, M+K sent a further separate letter to the administrators on behalf of Mr Collins. In that letter, M+K said that, by reason of his offsetting claims, Mr Collins was not required to make any further payments in respect of his loans. It requested that Timbercorp Finance refrain from recovery action and said that, if such action commenced, M+K expected to receive instructions to apply for an injunction to restrain further recovery until the offsetting claims were determined.

29 On or about 22 June 2009, M+K issued a circular to investors in Timbercorp schemes. The circular advised clients again to withhold loan payments and informed clients that, if the matter went to court, it would be argued that the subject loans were invalid.

30 In September 2009, Mr Tomes agreed to participate in the proposed group proceeding.

31 On 20 November 2009, Mr Tomes sent an email to M+K in which he brought to the firm's attention matters that related to the manner in which he came to make his investments, and particularly representations which he says were made to him about what would happen if he fell on difficult times while significantly indebted to Timbercorp. He says that M+K did nothing to bring these matters to the attention of the Court on his behalf during the trial of the group proceeding.

32 In June 2009, Timbercorp Finance commenced proceedings against 20 defaulting borrowers to recover loan moneys ('the initial proceedings'). The initial proceedings did not include Mr and Mrs Collins or Mr Tomes.

33 Each of the initial proceedings was managed by Judd J. Following service of the initial proceedings, M+K filed appearances in nine of the initial proceedings.

34 Mr Woodcroft-Brown was not a defendant to any of the initial proceedings.

35 On 24 July 2009, at a directions hearing before Judd J in the initial proceedings, counsel for defendants who had retained M+K told the Court that M+K had some 1400 clients with respect to the Timbercorp Group, and foreshadowed the commencement by an M+K client of a group proceeding against Timbercorp Securities and Timbercorp Finance.

36 During July and August 2009, M+K sent circulars to its clients that spoke of the desirability of commencing group proceedings against Timbercorp Securities and Timbercorp Finance on behalf of all affected investors.

37 Over the same period, there were several directions hearings in the initial proceedings. At those directions hearings, the Court was told that a group proceeding was being foreshadowed. By late August 2009, M+K had developed a draft statement of claim in the proposed group proceeding. For various reasons (including a difficulty in locating a suitable plaintiff), that proceeding was not commenced until October 2009.

38 During September 2009, Mr and Mrs Collins and Mr Tomes agreed to participate as group members in the proposed group proceeding.

39 Timbercorp Finance suspended its loan recovery project once the group proceeding commenced and recommenced the project when the group proceeding was finally determined and appeal avenues had been exhausted in 2014.

40 On 27 October 2009, Mr Woodcroft-Brown commenced the group proceeding, on his own behalf and on behalf of other Timbercorp scheme investors. In the sixth further amended statement of claim, the group was defined as follows:

This proceeding is commenced by the plaintiff on his own behalf and on behalf of all persons who:

(a) at any time during the period between 6 February 2007 and 23 April 2009 (the relevant period) acquired and/or held an interest in a managed investment scheme of which Timbercorp Securities Limited (ACN 092 311 469) (in liquidation) (TSL) was the responsible entity (the schemes) (scheme member);

PARTICULARS

[The relevant schemes were set out in a schedule to the pleading.]

(b) suffered loss or damage by the conduct of the defendants alleged herein; and

(c) are not:

(i) defendants to the proceeding;

(ii) parents, siblings, spouses or children of defendants;

(iii) bodies corporate of which a defendant was an officer or majority shareholder (defendant's company) at any time during the relevant period; or

(iv) beneficiaries of any trust, the trustee of which is or at any time during the relevant period was a defendant or defendant's company.

(Group Members)

41 The relief sought against Timbercorp Finance relevantly included (a) orders declaring that it was involved in contraventions of various provisions of the Corporations Act and the Corporations Law and (b) damages under various provisions of that Act and that Law. In addition, the following relief was sought:

Further or alternatively, orders under s 1325 of the Corporations Act (and s 1022C in respect of Group Members who are retail clients and/or s 729 of the Corporations Law) declaring that the Plaintiff and Group Members not be liable for any loans, fees or costs in connection with any of the schemes from February 2007 and any loans entered into with [Timbercorp Finance] in this period as a result of the breach of statutory duty be declared void or otherwise unenforceable.

As against Timbercorp Securities, the relief sought included orders declaring that the plaintiff and group members not be liable for any fees or costs in connection with any schemes from February 2007. Similar relief was also sought against the directors.

42 M+K were the solicitors for Mr Woodcroft-Brown in the group proceeding at all times. They appeared for him on the appeal and in the High Court special leave application. They remain the solicitors on the record in the group proceeding.

43 Throughout the duration of the group proceeding, M+K provided a series of reports to possible group members, including Mr and Mrs Collins and Mr Tomes. The reports were addressed to 'all MIS investors represented by Macpherson + Kelley' or 'Investors in Timbercorp and Great Southern MIS Projects'.

44 On or about 21 December 2009, M+K issued a circular to investors in the Timbercorp and Great Southern projects. The circular referred to a directions hearing in the group proceeding. The circular stated that, at the directions hearing, the Court said that it wanted to hear submissions as to whether the existing claim would be expanded to include any new claims based on misleading or deceptive conduct in connection with the promotion and sale of interests in particular projects that were fundamentally flawed from the beginning. The circular said:

We had already flagged the Table Grape Projects of 2004 and 2005 as a distinct possibility in that category. We continue examining other projects and will draw those to the attention of the Court on 18 February 2010 in connection with possibly linking new claims in with the existing Court proceeding.

45 On or about 3 June 2010, M+K issued a circular to M+K Timbercorp investors. The circular said, amongst other things, that joint submissions were being prepared ahead of the next case management hearing that addressed such things as 'whether there ought be any sub-groups formed to tackle specific aspects of the case', and what was to happen with counterclaims made by any of the defendants. The circular also said that consideration would be given to the manner of dealing with any claims the defendants might want to bring against third parties.

46 On or about 18 June 2010, Timbercorp Finance filed and served, among other things:

(a) a defence to the group proceeding and a counterclaim against Mr Woodcroft-Brown personally;

(b) a notice of counterclaim against Mrs Woodcroft-Brown;

(c) a notice of counterclaim seeking indemnity and/or contribution against Timbercorp Securities and its directors; and

(d) a third party notice and statement of claim against Timbercorp Ltd and entities involved in the provision of financial advice to Mr and Mrs Woodcroft-Brown.

47 In the counterclaim against Mr and Mrs Woodcroft-Brown, Timbercorp Finance alleged breaches under their loan agreements and sought payment for the outstanding loans plus interest and costs.

48 On about 9 July 2010, Mr and Mrs Woodcroft-Brown filed a reply and defence to Timbercorp Finance's defence and counterclaim.

49 On 11 October 2010, Judd J approved an opt out notice and ordered, among other things, that it be published and sent to specified investors.

50 Under a heading 'Background', the opt out notice said that '[t]he Plaintiff alleges that he and group members suffered financial loss because, during the period commencing 6 February 2007 and ending 23 April 2009 ("the Relevant Period"), the Defendants failed to disclose various matters that affected, or were likely to materially affect, investments made in the following Timbercorp managed investment schemes ("the Schemes")'.

51 The opt out notice then identified several Timbercorp schemes that existed between 2001 and 2008. In addition, it contained the following:

The Plaintiff also alleges that during the Relevant Period, he and group members suffered financial loss because the Defendants made false, misleading, or deceptive representations to him and to group members, in relation to the Schemes.

52 Under the heading, 'What happens if you do not OPT OUT', the notice said:

If you are a group member and you do not give notice to opt out by 4.00pm on 10 DECEMBER 2010, you will be taken not to have opted out and will, under Australian law, be bound by the outcome of the class action and any judgment or determination made in it. If the class action is unsuccessful or is not as successful as you might have wished, you will not be able to make the same claim in any other proceedings.

53 On 29 October 2010, M+K issued a further circular to investors in the Timbercorp and Great Southern managed investment scheme projects. The circular dealt with the opt out notice, and said, in part, as follows:

• It sometimes happens that people will prefer to handle their own cases rather than be part of a group whose members will be bound by whatever decisions are made about 'common issues' in any trial in a class action. Other people are simply not interested in pursuing their legal rights and remedies at all.
• Presently there is a draft of 37 formulated questions, many with several parts, which will be the focus of the court's attention in deciding on the common issues which will affect everyone participating in the case. ...
• It is primarily for the benefit of the 'go it alone' people that the rules of court require that they be given the opportunity to exclude themselves from the coverage of the class action if they so wish. If anyone wants to exclude themselves from the coverage of the class action they will need to send a formal notice to the Supreme Court of Victoria by the advertised date. This will signal to the court that they do not wish to be counted among the people who will be bound by any decision handed down in the trial of the class action.

• Individual issues on an investorbyinvestor basis would, under the class action framework, be worked through on the basis of the court's findings upon the issues that were common to everyone.
• We do not expect many, if any, of our clients would want to optout of the case. ... From the very beginning of the case the situation has been that Macpherson + Kelley has been retained by its clients to represent them both on an individual basis and as a member of the class on whose behalf the client action has been conducted. For everyone who remains a client of Macpherson + Kelley who does not send an optout notice to the court we will continue handling their individual file and the ancillary class action file.

• You can simply ignore the formal optout notice if you are happy for Macpherson + Kelley to continue representing you in the class action and in the individual investor issues that are to be resolved under the claim.

54 When he read the advice, Mr Tomes took the sentence that referred to continuing to handle clients' 'individual file[s]' and the ancillary class action file to mean that his own specific case was being looked after, including what he had raised in his email on 20 November 2009.[10]

55 On 5 November 2010, the group proceeding was fixed for trial on 3 May 2011, on an estimate of 8 to 10 weeks.

56 On 13-14 November 2010, the first opt out notice was published in The Australian (Weekend Edition).

57 In November 2010, Mr Collins received a copy of the opt out notice, issued pursuant to the court's order made on 11 October 2010. He maintained his decision to remain a client of M+K for the purposes of the group proceeding and individual investor issues that were to be resolved under the claim. He said 'I remained of the belief that there were no individual investor issues concerning us that were not covered by the common questions'. He did not return the notice.

58 Mr Tomes believes he received the opt out notice sometime in October 2010. Mr Tomes read the notice. It made no mention of any loan agreement, or that by not signing and returning it, Mr Tomes might be shut out later on from resisting any recovery proceedings that might be brought against him. Mr Tomes did not sign it.

59 In or about December 2010, the Supreme Court registry prepared a list of those who had opted out. It recorded that over 850 persons or entities had filed opt out notices with the Court.

60 In January 2011, the plaintiff in the group proceeding filed an application for leave to file and serve a fifth further amended statement of claim. The application sought, among other things, to add new causes of action concerning material nondisclosure across a nine year period in relation to the financial structures of the Timbercorp Group of companies.

61 On 9 February 2011, at a directions hearing, Judd J ordered, among other matters, that the counterclaims and the third party proceedings be tried separately from the main proceeding, after the determination of the common questions in the group proceeding set out in an annexure to those orders.

62 On 11 March 2011, Judd J approved the publication of a revised opt out notice. The revised opt out notice was occasioned by amendments made to the statement of claim. The relevant warning about the consequences of not opting out was as follows:

The Plaintiff also alleges that he and group members suffered financial loss because, between 4 April 2000 and 23 April 2009, the Defendants failed to disclose risks, associated with the financial structure and operations of the Timbercorp Group of Companies, that affected, or were likely materially to affect, the safety and prospects of investments made in the Schemes.

Further, the Plaintiff alleges that he and group members suffered financial loss because the Defendants made false, misleading or deceptive representations to him and to group members, in relation to the Schemes.

If you are a group member then the class action will determine your rights, if any, to compensation or other relief unless you choose to opt out of the class action.

If you do not give notice to opt out by 4.00pm on 15 APRIL 2011, you will be taken not to have opted out and will, under Australian law, be bound by the outcome of the class action and any judgment or determination made in it. If the class action is unsuccessful or is not as successful as you might have wished, you will not be able to make the same claim in any other proceedings.

63 Mr Collins received but again did not return the revised opt out notice.

64 On about 16 March 2011, Mr Tomes received a circular from M+K which made reference on the first page to a revised form of opt out notice. Mr Tomes received the notice around the same time as this update. Mr Tomes did not sign and return the revised opt out notice.

65 On 26-27 March 2011, the revised opt out notice was published in The Australian (Weekend Edition). As a result of the revised opt out notice, a further 250 persons or entities filed opt out notices, and 200 persons filed withdrawal of opt out notices.

66 Briefly stated,[11] the plaintiff said that, had certain matters been disclosed, he would not have invested in the managed investment schemes or borrowed money from Timbercorp Finance. He said that Timbercorp Securities had failed to disclose in its Product Disclosure Statements ('PDSs') information about significant risks, or risks that might have had a material influence on the decision to invest, in breach of its disclosure obligations under the Corporations Act. He also argued that the PDSs given to investors contained false and misleading statements. Further, he argued that the declarations made by the directors in two scheme financial reports were false or misleading, and in breach of the Corporations Act, the Australian Securities and Investments Commission Act 2001 (Cth) ('ASIC Act') and the Fair Trading Act 1999 (Vic) ('FTA'). He sought declaratory relief, damages and/or compensatory orders, including an order that the plaintiff and the group members were not liable for repayment of the loans from Timbercorp Finance.

67 The trial was conducted over 24 days. It dealt with common questions and only looked at individual loss, reliance and causation in relation to the plaintiff and one other person. In its reasons, the Court of Appeal identified 'two threads' to the plaintiff's case: one was a non-disclosure case; the other a misrepresentation case.[12]

68 In respect of his non-disclosure case, the plaintiff submitted that the Timbercorp companies had failed to disclose matters relating to 'structural risk' and 'adverse matters'. He said that the structural risk was a risk that the Timbercorp Group might fail because of insufficient cash, with a consequential risk to the viability of the schemes managed by Timbercorp Securities. He said that the adverse matters were matters alleged to have put the business of the Timbercorp Group at a heightened risk of failure. In this respect, he relied principally on (a) a tax announcement made on 6 February 2007 which was to the effect that a draft taxation ruling was being prepared which would mean that investors in non-forestry managed investment schemes would no longer be able to claim upfront deductions for contributions to such schemes and (b) the global financial crisis and its resulting impact on the availability of credit.

69 With respect to matters of 'structural risk', Judd J made various findings of fact to the effect that, when the PDSs were published, there was no significant risk of the group collapsing and that the risk as pleaded was not one about which it could be said, under s 1013D of the Corporations Act, that a retail client would reasonably require information for the purpose of making a decision to acquire the product.

70 Judd J held that Timbercorp Securities was not required to provide information on the structural risk or adverse matters to potential or existing investors. He held that the plaintiff's non-disclosure case, as pleaded, failed.

71 During the trial, the plaintiff produced a document entitled 'plaintiff's case in a nutshell'. In that document, the plaintiff's case shifted beyond its pleaded case. In it, the plaintiff developed the proposition that, due to its business model, 'the Timbercorp Group was critically dependent on its ability to maintain and increase its borrowings' and that this dependency was a significant risk that should have been disclosed.[13]

72 Judd J did not permit the plaintiff to propound the unpleaded case. However, he went on to find that, even on his unpleaded case, the plaintiff would not have succeeded. He found that the evidence before him did not reveal any unique or particular fragility in the Timbercorp business model. Moreover, he also held that the PDSs issued during the relevant period disclosed information about the unpleaded risk, in so far as it was required.

73 In respect of his misrepresentation case, the plaintiff said that the Timbercorp Group had made two types of false representations. The first was that the group was, financially, sufficiently strong that investors could reasonably expect the schemes to be managed for the foreseeable future and that the principal risks associated with the relevant schemes were fully disclosed. The second was that scheme contributions equalled or exceeded the cost of establishing and managing a scheme, in that investors' payments would be 'quarantined' and applied only to their relevant scheme, and scheme contributions would be sufficient to fund the relevant project. Judd J found that the first representations were either too vague or uncertain to be actionable and that there were reasonable grounds for confidence in the strength of the group in any case. He also held that the mere occurrence of the adverse matters did not make the representations false or misleading because those matters were able to be successfully managed. He found that the second representations (a) were not made, (b) were inconsistent with the PDSs and other generally available information and (c) were inconsistent with the claimed reliance on the strength of the group.

74 The plaintiff also argued that Timbercorp Securities and its directors made statements in March and September 2008 that were misleading or deceptive. The relevant statements were to the effect that there had been no circumstances that had significantly affected, or may have significantly affected, the operations of the relevant schemes, the results of those operations or the state of affairs of the schemes in future financial years. The plaintiff also argued in the alternative that Timbercorp Finance was liable under the Corporations Act, the ASIC Act and the FTA because the contravening conduct was engaged in on its behalf or because it was knowingly concerned in the contraventions. Judd J found that the plaintiff's case failed on causation and reliance.

75 On 27 October 2011, Judd J delivered reasons for his decision in relation to the common questions, costs and the orders to be made in light of the decision ('the final decision'). He:

(a) made a declaration pursuant to s 33ZB(a) of the Act as to the persons affected and bound by the orders;

(b) approved the form and content of a notice to be given to group members of the final decision and of the orders made ('the judgment notice');

(i) Mr Woodcroft-Brown's claim, in both his individual and representative capacity, against the defendants be dismissed;

(ii) the claim of Francis Jeremy van Hough against the defendants be dismissed;

(iii) the common questions be answered in the form attached to his order ('common questions and answers');

(iv) the making of consequential orders in respect of the defendant's third party proceedings and proceedings seeking contribution stand reserved;

(v) the making of directions with respect to the further conduct of Timbercorp Finance's counterclaim against Mr and Mrs Woodcroft-Brown stand reserved and be adjourned sine die;

(vi) Mr Woodcroft-Brown pay the defendants' costs of and incidental to the claim against the defendants, including reserved costs on a party-party basis;

(vii) the judgment notice in the form annexed to the order be approved for the purpose of giving notice to group members of the court's decision.

76 In his order, Judd J identified the common questions which were decided in the group proceeding and the answers that he gave to them. In all, there were 33 such questions. In large part, the questions concerned the disclosure obligations of Timbercorp Securities in respect of various managed investment schemes that had been established by it between 2001 and 2008, including the schemes in which Mr and Mrs Collins and Mr Tomes had invested, and allegations that members of the Timbercorp Group had engaged in misleading or deceptive conduct. Generally speaking, the disclosure obligations were said to arise from the facts that: (a) the cash-flows to the Timbercorp Group were uncertain and its funding may be inadequate; (b) a tax decision was announced in February 2007 that had the potential to jeopardise the continued willingness of people to invest in non-forestry managed investment schemes; (c) a substantial deterioration in credit and financial markets occurred in late 2007; and (d) the Timbercorp Group was in breach of certain loan covenants in its bank facilities.

77 The questions in relation to the allegations of misleading or deceptive conduct involved whether: (a) the continuing promotion and provision of loans to investors by the Timbercorp Group constituted representations that the schemes were viable and the Timbercorp Group financially secure; (b) the offering of loans constituted representations that the funds would be applied to fund the particular scheme; and (c) the failure to disclose the matters the subject of the disclosure obligations constituted representations that the Timbercorp Group was viable, financially secure, and so forth.

78 There were also common questions in respect of (a) reliance and causation and (b) loss and damage in relation to what were described as the Sample Group Member Schemes.[14]

79 As noted earlier, the Court of Appeal dismissed an appeal from Judd J's decision in the group proceeding and the High Court refused an application for special leave to appeal that decision. Since the disposition of the application for special leave, Timbercorp Finance has commenced 1288 proceedings for the recovery of moneys owing under loans. As at 24 April 2015, 1109 of those proceedings remained extant. M+K are the solicitors on the record in 296 proceedings, 195 of which raise defences, set offs and other allegations equivalent to those raised by Mr and Mrs Collins in their defence. The liquidators of Timbercorp Finance have yet to issue proceedings in respect of approximately 360 additional borrowers whose loans are in default.

80 Timbercorp Finance alleged that, on 19 March 2010, it made a demand for the total amount owing under the loan agreement and that Mr and Mrs Collins had failed to meet the demand. It says that, by letter dated 2 May 2014, it wrote to Mr and Mrs Collins confirming that they remained in default of their payment obligations under the loan agreement and advising that it intended to issue proceedings.

81 By a writ dated 13 June 2014, Timbercorp Finance claims against Mr and Mrs Collins moneys outstanding under loan agreement L0026087 for the sum of $51,300.

82 In July 2014, M+K received from Timbercorp Securities:

(a) a set of executed licence agreements in respect of the 2008 Timbercorp olive project invested in by Mr and Mrs Collins. None of those licence agreements named Mr or Mrs Collins in the schedule; and

(b) a series of letters variously dated May and June 2008 concerning instructions given to the trust custodian in respect of the flow of application moneys relating to olive grove lots that had been allocated in the 2008 Timbercorp olive project. The schedules for that series of letters were redacted documents with neither Mr nor Mrs Collins's name appearing on any of them.

Mr Collins was unable to say whether he or his wife, but for the redactions, were among the identified growers in any of the schedules (to the letters) which listed persons said to have been allocated lots in the project.

83 On 12 August 2014, Mr and Mrs Collins filed a defence and counterclaim.

84 On 6 March 2015, M+K received from Timbercorp Securities an executed copy of the grove lot management agreement for the 2008 Timbercorp olive project.

85 On 15 April 2015, M+K received from Timbercorp Finance a copy of a signing page of the loan agreement with Timbercorp Finance and a standard form set of provisions described in the footer of each page as 'Loan Explanation and Loan Terms' issued by Timbercorp Finance, pertaining to the Collinses' application for finance for acquisition of grove lots in the 2008 Timbercorp olive project. Mr Collins gave evidence that he could not recall seeing such a signing page for either his wife or himself or any such document.

Amended defence of Mr and Mrs Collins to recovery proceedings

86 By their amended defence dated 12 February 2015, Mr and Mrs Collins admit applying for the loan, but make several allegations as a result of which they contend that there was no loan advanced to them and they did not acquire an interest in the 2008 Timbercorp olive project. In large part, these contentions depend upon the allegations that there were contraventions of the constitution of the 2008 Timbercorp olive project and that, by reason of the same persons being directors of all the relevant Timbercorp companies, Timbercorp Finance had knowledge of and was a party to those contraventions. In the amended defence, there is a description of the manner in which interested parties made applications for loans from Timbercorp Finance and how those applications were to be satisfied by the release of funds by Timbercorp Finance to Timbercorp Securities. The pleading alleges several failures by relevant Timbercorp entities to conform with all the requirements necessary for the release of funds. In particular, they contend that:

(a) in mid-June 2008, Mr and Mrs Collins returned to Timbercorp Securities an application form for a specified number of grove lots together with a power of attorney with respect to a loan application for funds from Timbercorp Finance sufficient to cover the acquisition of the grovelot licence;

(b) when Timbercorp Finance received their loan application form, it drew down upon a loan facility provided to it by the ANZ Bank, an amount at least equal to Mr and Mrs Collins's alleged loan amount and directed that those funds be paid to the trust custodian;

(c) Timbercorp Ltd instructed the trust custodian to pay the funds to Timbercorp Ltd, which, thereafter, used the moneys in the course of its business;

(d) Mr and Mrs Collins were required to secure their obligations under Timbercorp Finance's loan by assigning to it, by way of security, their interest in each grove lot applied for;

(e) under the constitution for the 2008 Timbercorp olive project, Timbercorp Securities:

(i) was required to prepare grove lot licence agreements and management agreements;

(ii) could only release application moneys for grove lots under the grovelot licence agreements and management agreements;

(iii) was permitted to release application moneys only after it had reasonably satisfied itself that there were in place relevant grove lot licence agreements and management agreements;

(f) Timbercorp Securities failed to comply with these relevant provisions because it could not reasonably satisfy itself that those agreements were in place, by reason that the schedule of the alleged licence agreement did not name Mr and Mrs Collins as persons allocated lots in the project;

(g) alternatively, by reason of there being no licence agreement, there were no 'fees payable' under the management agreement or any licence agreement in respect of which Timbercorp Securities could use any application moneys received by it from Mr and Mrs Collins or from Timbercorp Finance on their behalf; and

(h) by reason of these facts and matters, Timbercorp Securities could not use any application moneys purportedly received from Timbercorp Finance on behalf of Mr and Mrs Collins, and was instead required to hold and retain the moneys on trust for Mr and Mrs Collins.

87 Further, Mr and Mrs Collins say that Timbercorp Finance has not made a loan to them in response to their loan applications because (a) Timbercorp Finance did not pay to Timbercorp Securities the moneys drawn down by Timbercorp Finance as the payment of the balance of their application money; (b) Timbercorp Finance has not made any advance or loan to them within the loan terms prescribed by it under the relevant finance package; and (c) Timbercorp Finance has not at any time made a payment for their benefit.

88 In addition, Mr and Mrs Collins contend that Timbercorp Finance owed them duties of care which it has breached and that as a result of those breaches, they have suffered loss and damage which they have quantified as 'the alleged indebtedness' to Timbercorp Finance, and they contend that they are entitled to set off, against any liability they may have to Timbercorp Finance, its liability to them for damages.

89 Further, they say that Timbercorp Finance took advantage of their relatively weak bargaining position such that any assertion by Timbercorp Finance of its rights under the loan agreement is unconscionable and, thus, a contravention of various provisions of the ASIC Act.

90 By a writ dated 12 September 2014, Timbercorp Finance made two claims against Mr Tomes: the first under loan agreement L0025296 and the second under loan agreement L0028248.

91 In its proceeding, Timbercorp Finance claimed as follows:

(a) under loan agreement L0025296, the sum of $1,760,368.34 plus interest; and

(b) under loan agreement L0028248, the sum of $448,280 plus interest.

Amended defence of Mr Tomes to recovery proceedings

92 Mr Tomes filed an amended defence and counterclaim on 25 February 2015.

93 In his defence, Mr Tomes refers to one Spencer Broad, who, he says, was an agent of Timbercorp Finance. He also says that, by reason of the common directorships of Timbercorp Securities and Timbercorp Finance, the knowledge of the former was also that of the latter.

94 In respect of loan agreement L0025296, Mr Tomes says that Mr Broad made a series of representations to him, on behalf of Timbercorp Finance, upon which he relied before deciding to invest in the various projects. He said there were representations that:

(a) if he defaulted on his loan, Timbercorp Finance would not seek recourse against him; rather, it would take possession of his grovelots and sell them on the secondary market;

(b) all the borrowed funds would be applied solely to pay the application money for his grovelots;

(c) the value of his grovelots would not decrease as they had been fully funded by the initial application money and ongoing rent and management fees, which would be applied only to the relevant project;

(d) in the event of Timbercorp failing, the projects would continue even without Timbercorp Securities as the responsible entity as the projects were structured to be stand-alone, fully funded and sustainable and there would be continuity of day to day management which had been outsourced to experts;

(e) the project for which he was obtaining finance was a fully funded investment.

He said that the representations were partly in writing (he referred to a cash flow spreadsheet that was given to him) and partly oral (he referred to a meeting that he had with Mr Broad at his office on or about 8 May 2008). Mr Tomes contends: (a) that the representations were misleading or deceptive and in contravention of s 12DA(1) of the ASIC Act; and (b) that, by reason of the representations, his reliance upon Mr Broad and Timbercorp Finance's knowledge of Mr Broad's relationship of trust and confidence with him, Timbercorp Finance had engaged in unconscionable conduct in contravention of s 12CA(1) or alternatively s 12C(1) of the ASIC Act.

95 Mr Tomes says that the documentation in respect of loan agreement L0025296, pursuant to which moneys were purportedly advanced on his behalf, was executed by one John Stuart Murray as his purported power of attorney. He says that, when he filled out the relevant application for finance in 2008, he did not appoint either Timbercorp Finance or any of its directors or employees as his attorney. Accordingly, Mr Murray was not his attorney and, in the event, no loan agreement was entered into between him and Timbercorp Finance.

96 Mr Tomes claims that it was an essential term of loan agreement L0025296 that its proceeds were to be advanced by Timbercorp Finance to Timbercorp Securities solely as payment for his lots and his loan application fee. He says that the loan moneys were not advanced for that sole purpose but were applied for the purposes of the Timbercorp Group generally and that, as a result, the loan agreement was repudiated and, Mr Tomes having accepted the repudiation, the loan agreement was void ab initio.

97 Further, Mr Tomes contends that the repayments that he made in respect of loan agreement L0025296 were paid under a mistake of fact, that is (a) that the loan had been validly executed and (b) that the moneys had been advanced by Timbercorp Finance to Timbercorp Securities or there had been a total failure of consideration. As a result, Timbercorp Finance would be unjustly enriched if it were permitted to retain the repayments and it holds them on resulting or constructive trust for Mr Tomes.

98 In respect of loan agreement L0028248, Mr Tomes advances similar defences.

99 Finally, Mr Tomes says that, in the event that both loan agreements were valid and enforceable, Timbercorp Securities contravened the duties imposed upon it both under the Corporations Act and the relevant projects' constitutions in the use made of the funds which were advanced. In so far as the moneys became trust moneys, Timbercorp Securities could only use the funds for the purposes for which they had been provided and was required to hold those funds separate from any other property. Its failure to do so meant that it had acted in breach of trust, in respect of which Timbercorp Finance provided knowing assistance.

Preliminary question in Collins and Tomes proceedings

100 By its amended replies dated 9 April 2015, Timbercorp Finance contended that the respondents were precluded from raising their pleaded defences by reason of the fact that each was a group member in the group proceeding. In substance, Timbercorp Finance contended that the respondents were precluded by either or both of the doctrines of Anshun estoppel or abuse of process because (a) they had not opted out and (b) they had not sought to have their individual claims 'case managed' in the group proceeding. Timbercorp Finance did not submit that the respondents were precluded by res judicata or by issue estoppel.[15]

101 On 1 April 2015, Judd J ordered in each of the two proceedings that the following question be determined as a separate question under r 47.04 of the Supreme Court (General Civil Procedure) Rules 2005:

Are the defendants [ie the present respondents] precluded from raising any and if so what defences pleaded by them in this proceeding by reason of their participation as group members within the meaning of Part 4A of the Supreme Court Act 1986 (Vic) in proceeding S CI 9807 of 2009 [the group proceeding]?

Differences between allegations in the group proceeding and those in the defences in the recovery proceedings

102 The issues in the group proceeding largely turned on the adequacy of representations made by Timbercorp Securities in its widely distributed product disclosure statements. The plaintiff contended that, in publishing what were described as the 'defective' PDSs and directors' reports, Timbercorp Securities had contravened relevant provisions of the ASIC Act, the Corporations Act and the FTA. Generally speaking, he sought relief against Timbercorp Finance on the basis that it was a party to those contraventions. In some cases, the liability of Timbercorp Finance was said to be direct and not derivative, but on each of those occasions, that liability was alleged to arise from the fact that it had the same directors as Timbercorp Securities.

103 In their amended defences to the proceedings brought by Timbercorp Finance, Mr and Mrs Collins and Mr Tomes have raised matters that were personal to them: among other things, whether any loan had in fact been made to Mr and Mrs Collins, whether representations had been made personally to Mr Tomes such that, in the event of his default under his loans, recourse would be limited to his investments in the schemes, and whether the loan agreements with Mr Tomes had themselves been repudiated. However, Timbercorp Finance contends that there is a sufficient connectedness or closeness between the claims in the group proceeding and the respondents' defences that they should now be precluded from relying on those defences.

104 In part, the decision of the primary judge and these reasons concern the proper construction of ss 33C(1), 33Q, 33R, 33S, 33T and 33ZB of the Act. They provide as follows:

33C Commencement of proceeding

(1) Subject to this Part, if -

(a) seven or more persons have claims against the same person; and

(b) the claims of all those persons are in respect of, or arise out of, the same, similar or related circumstances; and

(c) the claims of all those persons give rise to a substantial common question of law or fact -

a proceeding may be commenced by one or more of those persons as representing some or all of them.

33Q Where not all questions common

(1) If it appears to the Court that determination of the question or questions common to all group members will not finally determine the claims of all group members, the Court may give directions in relation to the determination of the remaining questions.

(2) In the case of questions common to the claims of some only of the group members, the directions given by the Court may include directions establishing a sub-group consisting of those group members and appointing a person who consents to the appointment to be the sub-group representative party on behalf of the sub-group members.

(3) If the Court appoints a person other than the plaintiff to be a sub-group representative party, that person, and not the plaintiff, is liable for costs associated with the determination of the question or questions common to the sub-group members.

33R Individual questions

(1) In giving directions under section 33Q, the Court may permit an individual group member to take part in the proceeding for the purpose of determining a question that relates only to the claim of that member.

(2) In such a case, the individual group member, and not the plaintiff, is liable for costs associated with the determination of the question.

33S Directions for further proceedings

If a question cannot properly or conveniently be dealt with under section 33Q or 33R, the Court may give directions for the commencement and conduct of another proceeding, whether or not a group proceeding.

33T Adequacy of representation

(1) If, on an application by a group member, it appears to the Court that the plaintiff is not able adequately to represent the interests of the group members, the Court may substitute another group member as plaintiff and may make such other orders as it thinks fit.

(2) If, on an application by a sub-group member, it appears to the Court that the sub-group representative party is not able adequately to represent the interests of the sub-group members, the Court may substitute another person as subgroup representative party and may make such other orders as it thinks fit.

33ZB Effect of judgment

A judgment given in a group proceeding -

(a) must describe or otherwise identify the group members who will be affected by it; and

(b) subject to section 33KA, binds all persons who are such group members at the time the judgment is given.[16]

105 The primary judge answered the preliminary question in both proceedings in the negative: the respondents were not precluded from raising any defences pleaded by them by reason of their participation as group members in the group proceeding. He held that Anshun estoppel did not apply to group members who seek to raise different claims in subsequent individual proceedings. He rejected a contention that, in deciding not to opt out, group members had renounced their individual claims and had determined that the common claims would represent the totality of all their claims. He also rejected a contention that, unless group members sought to have their individual claims case managed (pursuant to s 33Q) as part of the group proceeding, they were barred from raising those claims in later proceedings.

106 At trial, Timbercorp Finance contended that, once a group proceeding had been commenced, it became the vehicle for the determination of all issues 'that arise from the same, similar or related circumstances' within the meaning of s 33C(1)(b).[17] It said that the same or similar circumstances include 'litigation arising from the entry into the loans with Timbercorp Finance'.[18] Group members are subject to all preclusionary principles including Anshun estoppel and abuse of process such that they are prevented 'from raising in subsequent litigation issues that should have been brought forward in the group proceeding, unless any recognised exception is available'.[19] The provisions of pt 4A permit a group member to seek directions in relation to a claim not raised in the group proceeding (or even a claim that could not have been raised in the group proceeding). Nothing in pt 4A prevents the operation of these preclusionary principles.[20] In particular, s 33J allows a group member to opt out; s 33T allows a group member to apply to the Court if the plaintiff is not adequately representing a group's interest; and ss 33Q, 33R, 33S, 33T and 33ZF confer on the Court power to give directions where a group member wishes to advance a claim that has not been pleaded by the plaintiff.[21]

107 The primary judge held that the respondents could not have brought forward their individual claims for determination in the group proceeding because:

(a) under s 33C, a plaintiff in a group proceeding can only raise claims that are common to the plaintiff and the other group members: '[g]roup proceedings cannot encompass idiosyncratic claims that lack even this minimum degree of commonality'.[22] For example, the plaintiff in the group proceeding could not have raised claims arising out of oral representations made to particular members of the group as those representations were not made to other people at the same time;[23]

(b) only a party has standing to invoke s 33ZF and, further, any order made under that section can relate only to a matter which has been raised by a party;[24]

(c) the reference in s 33Q to 'the remaining questions' is a reference solely to those questions 'which form part of the claim pressed by the plaintiff, which are left remaining after the determination of "the question or questions common to all group members"'.[25] The claims to which s 33Q refer 'are claims already raised within the group proceeding and, on that basis, the provision does not operate to allow group members to seek directions in respect of claims not already raised in the group proceeding'.[26]

(d) s 33R 'is only enlivened if directions are being given under s 33Q'.[27] It ensures that the plaintiff will not be liable for the costs of the determination of a question that relates only to an individual group member;

(e) s 33S supplements ss 33Q and 33R. Unlike those sections, it gives the Court power to give directions for the commencement and conduct of another proceeding;[28]

(f) s 33T does not give group members power to bring forward individual claims; it deals only 'with the group interests not individual defences (or claims)'.[29]

108 The primary judge held that ss 33Q, 33R, 33S, 33T and 33ZF are all cast in permissive terms. Even if they permit the introduction into a group proceeding of

idiosyncratic dimensions and individual claims ... [it] would be a much greater step, and indeed a step that was not required to resolve the difficulties facing plaintiffs wishing to bring a group proceeding, to establish a regime under which all idiosyncratic dimensions and individual claims must be raised and determined within the group proceeding. The concern of Part 4A was to ensure that idiosyncratic dimensions and individual claims do not prevent the initiation of a group proceeding.[30]

109 The primary judge found that group members, not being parties to the group proceeding, do not have an express right to invoke s 33Q. Further, if group members were able to add 'their many and varied claims to the group proceeding itself', the time, cost, inefficiency and delay of side-tracking the group proceeding to hold case management directions would subvert the efficiency of group proceedings and might well be contrary to the overarching obligations under the Civil Procedure Act 2010.[31]

110 The primary judge rejected the contention that the availability of Anshun estoppel would work to prevent a multiplicity of proceedings: (a) the wider the operation of the preclusive effect of a group proceeding, the more likely group members would opt out, causing the defendant to face subsequent litigation on the common questions;[32] (b) the application of this estoppel was fact intensive and would require an examination of the personal circumstances of each relevant group member;[33] (c) where an appropriate opt out notice was given, warning of potential preclusive effects, the introduction of individual claims and defences may work to make the determination of the common questions unmanageable;[34] and (d) a multiplicity of proceedings would in any event be likely in future group proceedings if group members began a practice of opting out so as to preserve their ability to run individual defences.[35]

111 Notwithstanding his ruling that the respondents could not have brought forward for determination their individual defences in the group proceeding and that Anshun estoppel did not apply against group members in group proceedings, the primary judge considered whether, if he was wrong in those conclusions, the respondents' failure to bring their claims forward meant that they should be estopped pursuant to Anshun from doing so in later proceedings. He held that they should not be estopped as: (a) it was unlikely that the judge in charge of the group proceeding would have allowed the defences to be tried in that proceeding;[36] (b) there was no risk of inconsistent findings;[37] (c) the opt out notices did not warn the respondents 'that unless they opted out they would be or may be precluded from raising any defences to the claims of Timbercorp Finance under their loan agreements';[38] (d) the claims made against Timbercorp Finance did not raise any issues relating to the lending process it engaged in but only sought relief against it on the basis that it was an accessory to the misleading conduct of Timbercorp Securities;[39] (e) the respondents would have had to have retained their own lawyers and, even so, they had no entitlement to raise their current defences in the group proceeding;[40] (f) the plaintiff in the group proceeding was not able to raise the individual defences as those defences would not have been common to at least six other group members together with the plaintiff;[41] and (g) there was no risk of inconsistent judgments as the group proceeding did not raise the defences of the individual respondents.[42] Accordingly, it was not unreasonable of the respondents to have failed to raise their defences in the group proceeding and, thus, Anshun estoppel should not prevent them from pursuing those defences.

112 It had also been contended that the failure of the plaintiff in the group proceeding to raise a particular claim meant that he would be estopped from raising that claim in a later proceeding and that, in so far as the group members were privies of the plaintiff, his failure had the consequence that the group members could not raise individual claims in a subsequent proceeding because they were privies of the plaintiff. The primary judge rejected those contentions. The primary judge accepted that the plaintiff in a group proceeding may be subject to an Anshun estoppel and that s 33ZB made express provision for the treatment of group members as if they were parties. However, the section had a limited operation and did not express any broader policy with respect to the preclusion of group members from bringing subsequent claims or defences.

113 The judge held that group members were not subject to estoppel as privies of the plaintiff because: (a) the group members did not authorise the plaintiff to represent them; (b) the plaintiff was not subject to fiduciary duties owed to group members; (c) the plaintiff is not required to consider the wider interests of group members; (d) the procedures contained in pt 4A do not adequately guard against collateral risks of representation; (e) pt 4A does not require group members to be informed of any preclusive effects of potential estoppels; (f) if group members and the plaintiff were held to be privies, there was a real risk that, in pursuing his or her own interests, the plaintiff might unwittingly preclude the future enforcement of other rights or obligations of far more value to group members; and (g) in so far as a plaintiff may not share the individual claim of a group member, the plaintiff may be prevented from pursuing the interests of a group member.[43]

114 The judge also considered the matter on the contrary assumption that the plaintiff in the group proceeding was the common law privy of the respondents. Once more, he found no unreasonableness on the part of the respondents: (a) they had no control of the plaintiff in his conduct of the group proceeding and they had no entitlement to be heard or take part;[44] (b) the plaintiff was under no obligation to take into account their interests and could run the group proceeding in a way that was contrary to those interests;[45] (c) the plaintiff could not propound the individual respondents' claims as they did not have the commonality required by s 33C;[46] and (d) to deny the respondents the ability to run their defences would be to derogate from their basic common law right to have an opportunity to present evidence and arguments.[47]

115 The judge also considered the matter on the hypothesis that group members were able to raise for directions the defences they now seek to propound.[48] Even in that situation, the judge held that Anshun estoppel would not apply as (a) even if group members had an entitlement to seek directions, the Court was under no obligation to give any directions for the determination of the individual claims;[49] (b) pt 4A neither expressly nor impliedly requires all individual claims to be determined in the group proceeding;[50] and (c) even if the opt out notice had provided an appropriate warning about Anshun estoppel, pt 4A does not treat group members as if they were parties except to the extent provided for in s 33ZB.[51] In reaching his conclusion, the primary judge disagreed with the reasoning of Judd J in Clarke v Great Southern Finance Pty Ltd (in liq)[52] and Croft J in Clarke v Great Southern Finance Pty Ltd (rec and mgr apptd) (in liq).[53] The primary judge considered that too much force should not be given to the opt out procedure: 'there are myriad reasons why a group member may fail to opt out'.[54]

116 Since the decision of the primary judge, and after the oral hearing in this Court, a judge in the Federal Court has adopted the approach favoured by the primary judge in preference to the two decisions just mentioned.[55] That case, like the other two, concerned applications for approval of a compromise in group proceedings. Naturally, the circumstances of each proceeding are very different. We have found the reasoning in each of these decisions to be helpful but have chosen, in light of the length of these reasons, not to canvass what was said in them in any detail.

117 Finally, the primary judge found that the respondents were not prevented from raising their pleaded defences by operation of the principles of abuse of process.[56]

118 In its applications for leave to appeal, Timbercorp Finance identified five proposed grounds of appeal. These were that the primary judge erred:

1. in holding that Anshun estoppel does not apply to group members in group proceedings under pt 4A of the Act and thus is not engaged in relation to the respondents;
2. in holding that the applicant elected not to submit that the respondents' failure to opt out from the group proceeding precluded them from running their defences;
3. in finding that, if applicable to group members in pt 4A group proceedings, Anshun estoppel did not preclude the respondents from running their defences;

4. in finding that the applicant drafted the opt out notice; and

1. in holding that the respondents were not precluded from running their defences on the basis of abuse of process.[57]

119 Mr and Mrs Collins filed a notice of contention. As amended, it contended that the primary judge should have found that they could not have identified during the group proceeding their defence that Timbercorp Finance did not make any loan to them. They further contended that the judge should have held that they could not have inspected discovered documents relevant to that argument, and even if they had, by virtue of the principle in Home Office v Harman[58] they could not have used any document so inspected for their own purposes.

120 The parties filed written submissions but directed no oral argument to the notice of contention. Timbercorp Finance relied, in particular, on the argument that M+K could readily have obtained the relevant documents in the group proceeding on behalf of Mr and Mrs Collins.

121 It will be useful to: (a) survey briefly the elements of a group proceeding; (b) examine the rights of a group member to take part in a group proceeding; and (c) review the principles that inform the application of Anshun estoppel in Australian courts. In performing the last task, we will (i) identify the relevant public interests that are advanced by Anshun estoppel; (ii) describe at a general level how the principle has been applied in Australian courts; and (iii) draw the conclusions that are mandated by the authorities.

Part 4A of the Act and the rights of group members

122 Part 4A of the Act, which provides for group proceedings, is based closely upon pt IVA of the Federal Court of Australia Act 1976 (Cth).[59] A group proceeding may be commenced where 'seven or more persons have claims against the same person', those claims 'are in respect of, or arise out of, the same, similar or related circumstances' and 'the claims of all those persons give rise to a substantial common question of law or fact'.[60] A group proceeding may be commenced whether or not the relief claimed is or includes equitable relief, consists of or includes damages, includes claims for damages that would require individual assessment or is the same for each person represented. Such a proceeding may be commenced whether or not the proceeding concerns separate contracts or transactions between the defendant and individual group members or involves separate acts or omissions of the defendant done, or omitted to be done, in relation to individual group members.[61]

123 The relationship between the plaintiff and group members is regulated by several provisions. In general, only the plaintiff may appeal[62] and the plaintiff alone will be liable in costs.[63] Generally speaking, the consent of a person to be a group member is not required.[64] However, a group member may opt out of the group proceeding by notice in writing before the date fixed by the Court for doing so.[65] In limited circumstances, the Court may, either before or after judgment, order that a person cease to be a group member or that a person not become a group member.[66] Where a person opts out of a group proceeding, that person may bring a claim or advance a defence unaffected by any judgment in the group proceeding.

124 If the Court is of the view that the plaintiff is not able adequately to represent the interests of group members, the Court has power, on an application by a group member, to substitute another group member as plaintiff.[67] The Court also has power, on the application of the defendant, to order that a proceeding no longer continue under pt 4A if it is satisfied that (a) the costs of the group proceeding would be excessive; (b) relief can be obtained by a proceeding other than a group proceeding; (c) the group proceeding 'will not provide an efficient and effective means of dealing with the claims of group members'; and (d) it is 'otherwise inappropriate that the claims be pursued by means of a group proceeding'.[68]

125 As elaborated further below, other provisions regulate the handling of questions that are not common questions, be they questions that the plaintiff has that are not shared with the group members or questions that group members have that are not common with the plaintiff or with other group members.[69] Part 4A also contains provisions that regulate the settlement of group proceedings.[70]

126 No provision gives a group member any right to participate in the group proceeding. However, several provisions provide for notice to be given to group members at various stages of the proceeding.[71] The Court may dispense with the giving of that notice if the relief sought in the proceeding does not include a claim for damages and, if notice is to be given, it may be given by press advertisement, radio or television broadcast or any other means. Unless the Court is satisfied that it is reasonably practicable and not unduly expensive to do so, the Court may not order that notice of the proceeding is to be given personally to group members.[72]

127 Although it will involve a degree of repetition, it is worth giving separate consideration to the rights of group members in a group proceeding. A group member has the right to opt out of the group proceeding.[73] A group member has only limited rights to bring an appeal.[74] A group member has the right to receive notice of the commencement of the group proceeding and of various stages reached in that proceeding.[75] However, the group member does not have an entitlement to be served personally.[76] A group member may ask the Court to make orders under s 33Q, but has no express right to make any such request. In giving directions under s 33Q, the Court may permit an individual group member to take part in the proceeding for the purpose of determining a question that relates only to the claim of that member.[77] A group member has an express right to approach the Court under s 33T to make representations and seek directions about the adequacy of representation. In the event that the Court makes an order that a proceeding not continue as a group proceeding under pt 4A, a group member has an express right to apply to the Court for an order that the group member be joined as a plaintiff in the proceeding.[78] Where a fund has been created, the Court may 'if it is just' allow a group member to make a claim on the fund.[79] Where the plaintiff settles his or her own claim, a group member may apply to the Court for a direction that he or she or another group member be substituted as plaintiff.[80]

128 A group member will be bound by any judgment in the proceeding,[81] but will not be liable for the costs of the proceeding.[82]

129 The limited role available to group members has been noticed in several decisions. Having considered the basic features of pt 4A, in Mobil Oil Australia Pty Ltd v Victoria, Gaudron, Gummow and Hayne JJ said:[83]

There is, therefore, a real possibility that some group members would remain 'perfectly ignorant of the proceedings, and of what is really going on'. That is, some of those who would benefit from success in the proceeding (but thereby lose the opportunity to pursue their individual claim in some way, or to some effect, different from the group proceeding) may have their rights affected without their knowing or consenting to that being done.

130 In Tomlinson v Ramsey Food Processing Pty Ltd, French CJ, Bell, Gageler and Keane JJ said that '[t]hree forms of estoppel have now been recognised by the common law of Australia as having the potential to result from the rendering of a final judgment in an adversarial proceeding', each form of estoppel operating as a preclusionary principle.[84] Having explained cause of action estoppel and issue estoppel, they said:[85]

The third form of estoppel is now most often referred to as 'Anshun estoppel', although it is still sometimes referred to as the 'extended principle' in Henderson v Henderson. That third form of estoppel is an extension of the first and of the second. Estoppel in that extended form operates to preclude the assertion of a claim, or the raising of an issue of fact or law, if that claim or issue was so connected with the subject matter of the first proceeding as to have made it unreasonable in the context of that first proceeding for the claim not to have been made or the issue not to have been raised in that proceeding. The extended form has been treated in Australia as a 'true estoppel' and not as a form of res judicata in the strict sense. Considerations similar to those which underpin this form of estoppel may support a preclusive abuse of process argument.

131 The principles that inform the application of Anshun estoppel are properly traced back to the judgment of Wigram V-C in Henderson v Henderson.[86] In the United Kingdom, the principle has been classified as a species of the doctrine of abuse of the process of the court. In their joint judgment in Anshun, Gibbs CJ, Mason and Aickin JJ described that classification as not helpful[87] and, as will appear below, preferred to express the matter as one of broad principle sui generis. That said, recent Australian authorities have relied on English authorities to illustrate the paradoxically confined nature of the 'extended principle'.[88]

132 In Henderson v Henderson, Wigram V-C said:[89]

where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.

133 In Greenhalgh v Mallard, Somervell LJ said:[90]

res judicata for this purpose is not confined to the issues which the court is actually asked to decide, but ... it covers issues or facts which are so clearly part of the subject-matter of the litigation and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be started in respect of them.

134 In Anshun the majority of the High Court (Gibbs CJ, Mason and Aickin JJ) held that the principle stated by Wigram V-C applies against a party asserting a cause of action in a subsequent proceeding if it appears that it was unreasonable for that party to have refrained from raising a cause of action in an earlier proceeding. They said:[91]

In this situation we would prefer to say that there will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding. In this respect, we need to recall that there are a variety of circumstances, some referred to in the earlier cases, why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings e.g. expense, importance of the particular issue, motives extraneous to the actual litigation, to mention but a few.

135 In Anshun, the plaintiff had been injured by girders being handled by a crane. The crane was operated by Anshun Pty Ltd, which had hired it from its owner ('the Authority'). The plaintiff sued both Anshun and the Authority. They served notices of contribution upon each other. The plaintiff was successful at trial. The Court ordered that Anshun should recover contribution from the Authority to the extent of 90 per cent of the plaintiff's damages and costs, and that the Authority should recover contribution from Anshun to the extent of 10 per cent of those damages and costs. It transpired that, when Anshun had hired the crane from the Authority, it had indemnified the Authority against 'all actions, proceedings and claims whatsoever brought against [the Authority] ... arising directly or indirectly out of or in any way attributable or incidental to the use of the plant during the period of the hire'.[92] In a second proceeding, the Authority made a claim against Anshun under the indemnity. Anshun contended that the second claim should be stayed pursuant to Henderson v Henderson. In assessing the question of unreasonableness, the Court in Anshun said that a factor to take into account was whether the prosecution of the second action may give rise to conflicting judgments.[93] It held that a judgment on the Authority's claim for indemnity would contradict the earlier judgment on contribution. The Court also considered whether there were any 'special circumstances' that might take the Authority outside the principle that required 'the same parties to open the same subject matter of litigation in respect of matter which might have been brought forward as part of the subject matter in contest'. The Authority having offered no explanation for its failure to do so, the Court held there were no such special circumstances.[94]

136 In referring to the 'traditional statement of principle' drawn from Henderson v Henderson,[95] Gibbs CJ, Mason and Aickin JJ, while recognising that the principle was not a case of res judicata but an 'extended principle',[96] referred to 'the powerful arguments based on considerations of convenience and justice which were associated with it'.[97] Those considerations can be recognised when one considers their earlier approval of what Fullagar J had said about res judicata in his dissenting judgment in Jackson v Goldsmith:[98]

where an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action. This rule is not, to my mind, correctly classified under the heading of estoppel at all. It is a broad rule of public policy based on the principles expressed in the maxims 'interest reipublicae ut sit finis litium' and 'nemo debet bis vexari pro eadem causa.'

137 In Barrow v Bankside Agency Ltd, Sir Thomas Bingham MR commenced his judgment with a statement of the public policies that grounded the estoppel. He said:[99]

The rule in Henderson v Henderson ... is not based on the doctrine of res judicata in a narrow sense, nor even on any strict doctrine of issue or cause of action estoppel. It is a rule of public policy based on the desirability, in the general interest as well as that of the parties themselves, that litigation should not drag on for ever and that a defendant should not be oppressed by successive suits when one would do. That is the abuse at which the rule is directed.

138 In Johnson v Gore Wood & Co, Lord Bingham (with whom Lord Goff, Lord Cooke and Lord Hutton relevantly agreed) said:[100]

The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all.

139 Similarly, in Redowood Pty Ltd v Link Market Services Pty Ltd, Hodgson JA (with whom Mason P and Bryson AJA agreed) said of Anshun that[101]

[t]his leading judgment did not treat this extended estoppel as being based on jurisdiction to prevent abuse of process; but in my opinion, this extended estoppel, operating beyond the area of res judicata, issue estoppel and merger is (as Justice K R Handley said in his article 'Res Judicata: General Principles and Recent Developments' (1999) 18 Australian Bar Review 214, 219) 'based on the court's inherent jurisdiction to prevent abuse of its process by proceedings which are vexatious, that is unreasonable'.

140 As indicated above, the test for the application of Anshun estoppel involves an assessment of the conduct of the party sought to be estopped in a later proceeding in not advancing a claim or defence in the earlier proceeding and whether it should be said that it was unreasonable of the party not to have advanced that claim or defence. In Gibbs v Kinna,[102] Ormiston JA drew attention to the significance of the double negative embodied in the Anshun test. The issue was not whether it would have been reasonable to make some claim or advance some defence in the earlier proceedings. Rather, 'the issue is whether it was unreasonable to defer reliance upon the defence or cause of action' in the earlier proceeding.[103] In the same case, Kenny JA said:[104]

to decide whether or not it was unreasonable for a plaintiff not to litigate closely related issues in the one proceeding requires consideration of all the relevant facts, including the character of the previous proceeding, the scope of any pleadings, the length and complexity of any trial, any real or reasonably perceived difficulties in raising the relevant claim earlier, and any other explanation for the failure to raise the claim previously.

A similar emphasis on 'unreasonableness' appears in the extract from the joint judgment in Tomlinson set out at [130] above. In Meriton Apartments Pty Ltd v Industrial Court (NSW), Handley AJA (with whom Tobias JA agreed) said: '[t]he Anshun test is based on the reasonableness or otherwise of the conduct of a litigant in earlier proceed[105]s'.105 This observation, preceding the relevant passage from Anshun, was plainly not intended to express any different test.

141 In Johnson v Gore Wood & Co, Lord Bingham rejected 'too dogmatic an approach' in favour of what should be 'a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before'.[106] In Champerslife the New South Wales Court of Appeal adopted the 'broad merits-based' approach essayed by Lord Bingham.[107] Handley AJA said that the test of relevance and reasonableness mandated by Anshun 'gives content to the somewhat amorphous test of abuse of process accepted in Johnson v Gore Wood & Co' but that, '[i]n practice the former very often becomes the real test of the latter'.[108] Allsop P said that 'that the assessment is not to be made mechanistically, but rather there is a value judgment to be made referable to the proper conduct of modern litigation'.[109]

142 As was pointed out in Anshun itself, there may be many circumstances in which it will be held not to have been unreasonable not to have brought a claim or defence in earlier proceedings notwithstanding that the claim or defence brought in later proceedings arose out of the same facts and circumstances involved in the earlier proceedings. The example given in Anshun was Davis v Hedges.[110] In that case, it was held that a plaintiff was not precluded from bringing a claim for improper performance of work notwithstanding that he had not raised the matter when defending an earlier claim for the price of the work. As Gibbs CJ, Mason and Aickin JJ said in Anshun, '[t]o require that the defendant always raise his counterclaim or set-off at the first available time could cause great inconvenience'.[111] As Hannen J explained in Davis v Hedges, an action for the price of goods delivered or work performed may be maintainable before the defendant is able to determine whether there is a claim for breach of warranty that may afford a defence.[112]

143 Several Australian cases have considered the question of 'unreasonableness' where the plaintiff or defendant in the later proceedings did not have the right to bring forward the relevant matter either as a claim or a defence in the earlier proceedings, but was reliant upon a favourable exercise of one or more judicial discretions. For example, in Ling v Commonwealth,[113] the Commonwealth had commenced bankruptcy proceedings against Ling by reason of his failure to satisfy a judgment in favour of the Commonwealth that he refund fees prepaid to him by international students unable to take up courses in Australia.[114] Thereafter, Ling commenced a proceeding against the Commonwealth in the Supreme Court of Victoria in which he sought damages for negligent misstatement; he contended that the Commonwealth had falsely represented that it would facilitate the entry of the students into Australia. When his claim was transferred into the Federal Court, Ling relied upon it to show that he had a 'sufficient cause' why a sequestration order should not be made under s 52(2)(b) of the Bankruptcy Act 1966 (Cth). The Full Court of the Federal Court allowed an appeal against the order of the primary judge, who had dismissed the negligence claim on the basis of Anshun estoppel because it should have been set up as a cross-claim to the Commonwealth's original claim. The Full Court held that there would have been difficulties had Ling attempted to have his cross-claim consolidated with the Commonwealth's claim; it would have been a 'tortuous route'.[115] Sundberg J referred to a number of procedural obstacles, most of which could only be surmounted by the favourable exercise of judicial discretion, that stood in Ling's path. Ling would have had to commence his proceeding in the High Court, and persuaded that Court to remit the matter to the Federal Court[116] and, then, he would have had to persuade the Federal Court to consolidate the claim and cross-claim. In those circumstances it was not unreasonable for him not to do so. In Meriton Apartments, the New South Wales Court of Appeal held that doubts and difficulties about the jurisdiction of the court in which the earlier proceedings were brought made it not unreasonable for the party in later proceedings not to have brought its claim in those earlier proceedings.[117]

144 Courts have refused to apply Anshun estoppel where they are of the opinion that it would have been unlikely that the first court would have entertained the claim or defence in the first proceeding.[118] Further, courts have refused to apply Anshun estoppel where a plaintiff, possessed of several causes of action against different defendants, has chosen to bring proceedings against only one so that, should that action be successful, there would have been no need to pursue the others or to run the risk of adverse consequences if all defendants had been joined to the proceeding.[119]

145 The rule can also be applied to bar a party who was not a party in earlier proceedings.[120] In Johnson v Gore Wood & Co, Lord Bingham said:[121]

In my judgment this argument [that the rule in Henderson v Henderson did not apply to Mr Johnson since he had not been the plaintiff in the first action against the firm of solicitors] was rightly rejected. A formulaic approach to application of the rule would be mistaken. [W Ltd] was the corporate embodiment of Mr Johnson. He made decisions and gave instructions on its behalf. If he had wished to include his personal claim in the company's action, or to issue proceedings in tandem with those of the company, he had power to do so. The correct approach is that formulated by Sir Robert Megarry V-C in Gleeson v J Wippell & Co Ltd [1977] 1 WLR 510 where he said ... :

Second, it seems to me that the substratum of the doctrine is that a man ought not to be allowed to litigate a second time what has already been decided between himself and the other party to the litigation. This is in the interest both of the successful party and of the public. But I cannot see that this provides any basis for a successful defendant to say that the successful defence is a bar to the plaintiff suing some third party, or for that third party to say that the successful defence prevents the plaintiff from suing him, unless there is a sufficient degree of identity between the successful defendant and the third party. I do not say that one must be the alter ego of the other: but it does seem to me that, having due regard to the subject matter of the dispute, there must be a sufficient degree of identification between the two to make it just to hold that the decision to which one was party should be binding in proceedings to which the other is party. It is in that sense that I would regard the phrase 'privity of interest'.

146 In the same case, Lord Millett said:[122]

Particular care, however, needs to be taken where the plaintiff in the second action is not the same as the plaintiff in the first, but his privy. Such situations are many and various, and it would be unwise to lay down any general rule. The principle is, no doubt, capable in theory of applying to a privy; but it is likely in practice to be easier for him to rebut the charge that his proceedings are oppressive or constitute an abuse of process than it would be for the original plaintiff to do so.

There is, therefore, only one question to be considered in the present case: whether it was oppressive or otherwise an abuse of the process of the court for Mr Johnson to bring his own proceedings against the firm when he could have brought them as part of or at the same time as the Company's action.

147 In Angeleska v Victoria, the Court said that[124]

[a] finding that an Anshun estoppel operates to prevent a person from bringing a proceeding or particular claims is a serious step: it removes a litigant's right to have the merits of a claim adjudicated. For this reason, the authorities establish that an Anshun estoppel finding should only be reached in the clearest of cases and after 'a scrupulous examination of all the circumstances'.

...

[W]here an Anshun estoppel is asserted against a party who was not a party to the earlier proceeding, particularly a plaintiff, even greater caution must be exercised by the Court. This is because a new plaintiff would not ordinarily have been in control of the earlier proceeding ...

148 In Champerslife, it was contended that a plaintiff in a second proceeding should be barred from prosecuting that proceeding because it had failed to make a joinder application to become a party to an earlier action that involved facts and circumstances closely related to those in the second proceeding.[125] Giles JA said:[126]

Further, the submission did not address the correct question, that of unreasonableness of Champerslife's conduct. A mechanistic approach should not be taken, in the nature of identifying some common facts and finding an estoppel because they twice arise. As was said in Port of Melbourne Authority v Anshun, there are a variety of circumstances why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings. It is necessary to consider all the circumstances bearing upon unreasonableness.

149 A particular instance of Anshun estoppel affecting a non-party is where it operates to bar a claim or a defence by a party in a later proceeding who is a privy of a party to the earlier proceeding.[127] Particularly will this be so where a party seeks to enforce rights that are derived from a predecessor. In Champerslife, Handley AJA said:[128]

If a predecessor is Anshun estopped those who claim through him cannot be in a better position when enforcing rights derived from their predecessor. This does not mean that successors are bound when enforcing their own rights.

Such an application of the rule may prevent a beneficiary from seeking to enforce in a later proceeding rights that its trustee was barred by Anshun from prosecuting.[129]

150 In applying Anshun estoppel to a privy, it has been said that '[w]ith the benefit of the claim or defence also comes the detriment of estoppel'.[130] However, the theory has been said to have its limitations.[131]

151 In discussing the application of Anshun estoppel to privies, the parties paid particular attention to the recent decision in Tomlinson. That decision is discussed further below. For present purposes, it may be said that the application of Anshun estoppel to persons who were not parties to the previous proceedings is not to be determined formulaically[132] or mechanistically;[133] it depends upon there being 'a sufficient degree of identification' between the party to the previous proceeding and the party to the later proceeding.[134] If the claim or defence in the earlier proceeding benefitted the party now sought to be estopped, the benefit of the claim may bring the detriment of estoppel.[135]

152 Preclusionary principles can affect parties and their privies. For example, in Blair v Curran, Dixon J said that, if a 'judicial determination directly involv[es] an issue of fact or of law ... that [issue] cannot afterwards be raised between the same parties or their privies'.[136]

153 Timbercorp Finance contended that the group members were privies of the plaintiff in the group proceeding and that, as the plaintiff could and should have raised their individual defences during that proceeding and could no longer do so, the group members as privies were also precluded from doing so. Section 33ZB(b) provides that a judgment given in a group proceeding binds all persons who are group members at the time the judgment is given. In effect, it stipulates that, in respect of any matter in which the Court has given judgment, the group members are privies of the plaintiff. The present contention does not relate to s 33ZB(b). It relates to matters in respect of which the Court did not give judgment, because they were not raised for determination.

154 In Ramsay v Pigram, Barwick CJ referred to three classes of privy: privies of blood, privies of title and privies of interest.[137] Of the third category he said '[t]he basic requirement of a privy in interest is that the privy must claim under or through the person of whom he is said to be a privy'.[138]

155 There are traditional forms of representation that bind the represented party to an estoppel that binds the representative: (a) where the representative is the agent of the represented party; or (b) where the representative is a fiduciary of the represented party. In addition, courts have held that judgments in representative proceedings have the effect of creating estoppels that bind those that have been represented in those proceedings. In that context, Timbercorp Finance relied on the statement of Gaudron, Gummow and Hayne JJ in Mobil Oil Australia Pty Ltd v Victoria to the effect that, by actions under provisions such as pt IVA of the Federal Court of Australia Act 1976 (Cth), 'the claims that are made, or could be made, against the defendant by all those in the "class" or "group" that is identified in the proceeding would be decided'.[139] This observation appears to recognise the potential for Anshun estoppel to apply in group proceedings. But it is confined to claims that could be raised by 'all' in the class. Moreover, their Honours were clearly not purporting to displace the law governing the Anshun principle by enunciating any blanket rule in respect of group proceedings.

156 Timbercorp Finance made particular reference to Tomlinson. The argument proceeded as follows: had the plaintiff in the group proceeding attempted to use a later proceeding to agitate claims that remained unpleaded in the group proceeding, the plaintiff would be subject to Anshun estoppel. Because the plaintiff can no longer bring the unpleaded claims, any privy of the plaintiff is similarly estopped.

157 In Tomlinson, the issue was whether a party in a second proceeding was subject to issue estoppel arising from decisions made in an earlier proceeding to which he was not a party. Under the Fair Work Act 2009 (Cth), the Fair Work Ombudsman was given various functions. These included (a) commencing proceedings to enforce the Workplace Relations Act 1996 (Cth) and (b) representing employees who are or who may become parties to a proceeding in a court. In the exercise of the first of those functions (and not the second), the Fair Work Ombudsman applied to the Federal Court for the imposition of civil penalties on Ramsey Food Processing Pty Ltd ('Ramsey') for breach of a relevant award. In response to the claim, Ramsey contended that the true employer was Tempus Holdings Pty Ltd ('Tempus'). In those proceedings, the Court held that Ramsey had been the true employer and that Tempus was, in effect, a sham. The Court made declarations and imposed penalties. Subsequently, Tomlinson brought common law proceedings against Ramsey in which he claimed damages for negligence at common law in respect of a personal injury he had sustained. However, he did so on the basis that Tempus was his true employer and that the liability of Ramsey arose as a party in control of the relevant workplace. Had the claim been based on Ramsey being his employer, it would have been barred by State legislation.

158 The specific issue was 'whether the claiming by the Fair Work Ombudsman and the making by a court of declarations and orders in a civil penalty proceeding created an issue estoppel on which a respondent to that proceeding was entitled to rely in a subsequent common law proceeding brought against it by a worker'.[140] In order to hold that Tomlinson was bound by any issue estoppel, it was necessary to establish that he was a 'privy' of the Fair Work Ombudsman. Having discussed the judgment of Barwick CJ in Ramsay v Pigram, French CJ, Bell, Gageler and Keane JJ said:[141]

The justice of binding to an estoppel a person who was a party to an earlier proceeding is readily apparent: the person has already had an opportunity to present evidence and arguments. The justice of binding to an estoppel a person whose legal interests stood to benefit from the making or defending of a claim by someone else in an earlier proceeding will often also be apparent. With the benefit of the claim or defence also comes the detriment of the estoppel. That, at least, is the underlying theory. But it is a theory which has limitations. It would be quite unjust for such a person to be precluded from asserting what the person claims to be the truth if the person did not have an opportunity to exercise control over the presentation of evidence and the making of arguments in the earlier proceeding and if the potential detriment to the person from creating such an estoppel was not fairly taken into account in the decision to make or defend the claim in the earlier proceeding or in the conduct of the earlier proceeding.

Traditional forms of representation which bind those represented to estoppels include representation by an agent, representation by a trustee, representation by a tutor or a guardian, and representation by another person under rules of court which permit representation of numerous persons who have the same interest in a proceeding.[142] To those traditional forms of representation can be added representation by a representative party in a modern class action.[143] Each of those forms of representation is typically the subject of fiduciary duties imposed on the representing party or of procedures overseen by the court (of which opt-in or opt-out procedures and approval of settlements in representative or class actions are examples), or of both, which guard against collateral risks of representation, including the risk to a represented person of the detriment of an estoppel operating in a subsequent proceeding outweighing the benefit to that person of participating in the current proceeding.

159 In a separate judgment, Nettle J examined the principles pursuant to which one person could be said to be the privy of a party in an earlier proceeding. The task, he said, is[144]

one of identifying characteristics of a relationship between party and privy which, although not amounting to a shared same interest or established legal or equitable relationship like agency or trusteeship, are sufficiently analogous to the established categories of sufficient connection to warrant inclusion in the concept. And, for present purposes, the important characteristics of the established forms of representation which emerge from the decided cases appear to be that a principal is generally able to control the conduct of an agent, and that the imposition of fiduciary duties on certain kinds of representatives has the effect of guiding the representative's conduct and providing remedies to the principal on default.

160 It will be observed that a group member in a group proceeding has no opportunity to exercise any control over the way in which the plaintiff conducts the group proceeding; they cannot influence, let alone control, what evidence is adduced and what arguments are propounded. Further, unlike the cases where a fiduciary has proceeded on behalf of beneficiaries or an agent on behalf of a principal, the plaintiff in a group proceeding is under no duties towards group members that the latter are able to enforce.[145]

161 In its submissions, Timbercorp Finance sought to draw support from the joint judgment of French CJ, Bell, Gageler and Keane JJ in Tomlinson ('the joint judgment'). Counsel for Timbercorp Finance observed that the joint judgment countenanced that persons represented under the old representative procedure (found in the rules of various Supreme Courts) and group members in a group proceeding under pt 4A and its cognates could be treated as privies in interest of the representative plaintiff in the former proceedings and the plaintiff in the latter. The observation went further. It noted that, in referring to the old representative proceedings, the joint judgment in Tomlinson had cited Carnie v Esanda Finance Corporation Ltd,[146] and, in respect of group proceedings, it cited Zhang v Minister for Immigration, Local Government and Ethnic Affairs.[147] The submission then moved from the joint judgment itself and sought to draw particular significance from (a) the footnoted references to Carnie and Zhang (which are indicated in the extracts above) and (b) General Motors of Canada Ltd v Naken,[148] which is itself discussed in Carnie.

162 It is necessary to examine each of these cases to see what was decided with a view to understanding the use made of them in the joint judgment and whether it supports Timbercorp Finance's contentions.

163 In Naken, the Supreme Court of Canada considered whether a claim should proceed as a representative claim under r 75 of the Supreme Court of Ontario Rules of Practice. Much the same question arose in Carnie in respect of the Supreme Court Rules 1970 (NSW) pt 8 r 13(1). Rule 75 corresponded closely with pt 8 r 13(1), both having been derived from a common source.[149]

164 In Naken, the applicants sued a manufacturer on behalf of persons who had purchased new 1971 and 1972 Firenza motor vehicles in Ontario and who had not at the date of the writ sold the cars. Due to a defect, the value of the cars was allegedly diminished by $1000. The claim was based on a breach of implied and express warranties. The express warranty was contained in newspaper advertisements. In order to prove their membership of the class, individuals would have had to prove they had responded to the advertisements. The Supreme Court held that the proceeding should not continue as a representative proceeding. Estey J (who gave judgment on behalf of the Court) held that the action could not proceed as a representative action under r 75 as the rule was 'totally inadequate for employment as the base from which to launch an action of the complexity and uncertainty of this one'.[150] In particular, Estey J was troubled by the possibility that a judgment in a representative proceeding would give rise to a res judicata in respect of those represented despite their having quite disparate claims.

165 In analysing r 75 and its cognates in other jurisdictions, Estey J compared it with the emerging jurisdiction in respect of group proceedings that was developing under r 23 of the Federal Rules of Civil Procedure (US) and under what was then recently enacted legislation in California. In that context, he said:[151]

There is a further and considerable problem relating to the loss of right in the owners embraced in the alleged class to damages in excess of the $1,000 claimed in the statement of claim under what I have referred to as the 'Carlill' contract. As was pointed out by counsel for the appellant, there may in some instances be persons who became owners of one of these automobiles under circumstances covered by the revised pleadings authorized by the Court of Appeal, who may allege personal injuries suffered by reason of and related to one or more of the alleged deficiencies of the automobile. If the effect of the ultimate judgment in this class action is res judicata on all rights of all members of the class with respect to the acquisition of a Firenza automobile, the result would be serious in such a circumstance. The operation of the defence of res judicata has a long history in our courts, and no authority was drawn to the attention of the Court wherein a court ignored such a plea in the case of a class action. It is true that there is a discretion in the courts where the defence of res judicata is raised, but such a discretion must be very limited in application. This Court determined in Cahoon v Franks [1967] SCR 455, that all damages arising out of the same negligent act must be asserted by the claimant in the one action, and any subsequent action was barred by the doctrine of res judicata. The fact that harsh results follow the application of the doctrine has not deterred its application by the courts. Vide Cox v Robert Simpson Co Ltd [1973] 1 OR (2d) 333. Rule 75 is silent as to the issue, and, failing some specific provision by statute, regulation or otherwise, the defence of res judicata would continue to apply. The fact that the action may be in contract of one kind or another would appear to represent no basis for the selective application of the defence of res judicata. If the courts were to adopt a principle whereby class actions estopped participants from future action only to the extent of claims made in the class action, one of the root purposes of the class action would be defeated. The inherent benefit of the representative action sadly produces this serious side effect. This is no doubt the most important factor which excited legislators elsewhere to action in defining and describing this action and its conduct.

166 In Naken, Estey J held that res judicata would operate to preclude the represented parties in a representative proceeding (old style) from bringing the same claim as that which had been determined on the initiative of the plaintiff. For that reason, he was concerned to confine the operation of such representative proceedings. The Court did not have before it a group proceeding (new style) that corresponds to that provided for by pt 4A. Timbercorp Finance relied upon the sentence that has been emphasised. However, it is not entirely clear to what Estey J was referring. Read in context, he may have been referring to the circumstance that a determination of liability in contract will create a bar to a claim in tort in respect of the same facts. His reasons do not suggest that he is referring to the issue which arises in the present case: whether a group member can be estopped in respect of unpleaded claims that were outside the common issues. But even assuming that the judgment is to be taken as raising the possibility of Anshun-type estoppel operating in group proceedings, it does not discuss the principles that would govern its operation, let alone whether those principles would correspond to those that have been articulated more recently in Australia and in England.

167 In Zhang, the Federal Court (French J) considered the possible application of Anshun estoppel to group proceedings. In that case, the applicant claimed to be a refugee. He contended that he was denied natural justice as he was not given an oral hearing by the relevant decision maker in deciding his application for refugee status. He contended that 'every person who applies for refugee status is entitled, at least when an initial refusal to grant refugee status is reviewed, to an oral hearing by the delegate [of the Minister] who is to make the final decision'.[152] The applicant brought his claim as a group proceeding under pt IVA of the Federal Court of Australia Act 1976 (Cth). Having discussed the representative nature of the proceeding, French J recognised that, although the matter had not been argued before him, the members of the group were likely to have other individual claims relating to their claims for refugee status and that Anshun estoppel might possibly operate to preclude their bringing those claims in later proceedings.[153] Describing Anshun estoppel as 'the extended principle', he ordered that the proceeding no longer proceed under pt IVA because of its potential to adversely affect other group members who may have individual claims. French J said:[154]

The question of res judicata and the extended principle to which I have referred earlier remains. A judgment, once made on the common issue, is binding on all members of the group and on the Minister. That arises explicitly by virtue of s 33ZB(b). The question whether the extended principle of res judicata is capable of application to representative proceedings confined as these have been to a common issue of law or fact remains open. Section 33Q contemplates the hiving off of individual claims when the common determination does not finally determine the claims of all group members. That may support a view that the extended principle may operate when the claims are not hived off under that section. In a case in which the group members have not raised individual claims but have been defined into the group on their related circumstances and the common issue, it is necessary that care be taken to ensure that claims based on individual circumstances of which the Court knows nothing are not prejudiced. In my opinion, that concern may be dealt with by determining the common issue and giving judgment on that issue as required by s 33ZB. Thereafter, I am inclined to make an order under s 33N(1)(d) that the proceeding otherwise no longer continue under pt IVA. While Mr Zhang's claim will be disposed of, the claims, if any, of other members of the group to set aside the decisions affecting them individually may be pursued by their individual applications. As this matter was not argued before me, I will allow the parties liberty to make submissions on the final form of the orders disposing of the proceedings.

168 In Tomlinson, the footnoted reference to Zhang is plainly enough a reference to the circumstance that a group member may be a privy in interest with the plaintiff in such a proceeding. In Zhang, French J went further and expressly contemplated the operation of Anshun estoppel in a group proceeding. He also said that the issue had not been decided.[155] He did not himself have to decide it, but accepted that it might operate. To guard against it operating unexpectedly in the circumstances of the people who were drawn into the group, he directed that the matter before him no longer proceed as a group proceeding.

169 In Carnie, the High Court held that the consequence of a judgment in a representative proceeding under the Supreme Court Rules 1970 (NSW) pt 8 r 13(1) was that the represented parties were bound by an estoppel.[156] In that case, the plaintiff borrowers sued their lender claiming that various matters had not been disclosed under their credit contracts in contravention of relevant credit legislation. They claimed to sue on 'behalf of themselves and all other persons ("the represented debtors")' who had entered contracts with the lender that had the same characteristics as their contracts.[157] They claimed a declaration that no represented party was liable to pay any credit charges to the lender. The respondent sought orders that the proceeding be stayed in so far as it purported to be a representative action. In allowing an appeal from the New South Wales Court of Appeal,[158] the High Court described various features of representative proceedings that had been common throughout Australian States. In their reasons, Toohey and Gaudron JJ (with whom Mason CJ, Deane and Dawson JJ largely agreed) referred to Naken[159] and Zhang. They accepted that where there was a representative proceeding, any holding would bind all members of the class represented. However, there were limits to any estoppel. They said:[160]

In the argument before this Court nothing emerged to show that members of the class in question would be prejudiced by the outcome of this action other than in the obvious sense that they would be bound by a judgment acceding to or rejecting the claim for relief. It would not affect other rights they might have against the respondent, for instance a claim that a member of the class had entered into a contract as a result of misrepresentation or false or misleading conduct. If it did appear that other rights would be affected, it would be a matter for consideration in determining whether the Court should otherwise order.

170 It will be noticed that Toohey and Gaudron JJ confined the extent of any estoppel to the matter that had been dealt with by judgment; they did not suggest that there would be any Anshun estoppel, beyond contemplating that this may be a matter for consideration.

171 Anshun estoppel was also not in issue in Tomlinson. Although reference was made to Zhang (in which the possible application of the estoppel in a group proceeding was noticed but did not need to be determined), the Court did not dwell on the matter or adumbrate the principles that govern the application of the estoppel to group proceedings in respect of matters other than the common issues of fact and law. In the joint judgment, it is indicated that no attempt was made in Tomlinson to enlarge the concept of 'privy' or 'privies' along the line suggested in Johnson v Gore Wood & Co.[161]

172 Further, the joint judgment emphasised that[162]

[it] would be quite unjust for ... a person to be precluded from asserting what the person claims to be the truth if the person did not have an opportunity to exercise control over the presentation of evidence and the making of arguments in the earlier proceeding and if the potential detriment to the person from creating such an estoppel was not fairly taken into account in the decision to make or defend the claim in the earlier proceeding or in the conduct of the earlier proceeding.

It is plain from this observation that their Honours considered that a relationship of privity in connection with the conduct of legal proceedings depended, at least in part, on questions of control. It then went on to identify opt out procedures in class actions as an example of a procedure for guarding against 'the risk ... of an estoppel operating' in group proceedings.[163] But the joint judgment did not say that those very procedures will, if not availed of, produce that risk. The case presented no such issue for determination.

173 In these circumstances, and in light of the authorities to which the joint judgment referred, it must be concluded that the Court in Tomlinson did not hold that a representative party in a group proceeding under pt 4A is a privy of the persons represented, such that they are bound by any Anshun estoppel which applies to the representative party. Nor did it need to decide the point. But equally, the Court recognised the potential for an estoppel to arise in such proceedings, whether by virtue of statutory provision (such as s 33ZB) or by the application of Anshun estoppel to the group members otherwise than through the privity pathway.

174 Accordingly, Anshun estoppel may be applied notwithstanding that the person sought to be estopped was neither a party nor a privy of a party involved in the earlier case. But in the joint judgment in Tomlinson, it is recognised that there are 'limitations' to the theory that '[w]ith the benefit of the claim or defence also comes the detriment of the estoppel'.[164] As already noted, there would be an injustice in binding a person to an estoppel 'if the person did not have an opportunity to exercise control over the presentation of evidence and the making of arguments in the earlier proceeding'.[165] The judgment speaks of the 'collateral risks of representation'.[166] It recognises that there are various situations where a person will be bound by the conduct of another party and it expressly contemplates that group members may be bound provided those risks are addressed. It gives as examples of the management of such risks: (a) opt out procedures; and (b) the need for court approval of settlements. It is plain that the Court has suggested that estoppels can operate outside of the statutory estoppel contained in s 33ZB. And, while it cannot be said that group members who do not opt out are strangers to and unaffected by a group proceeding, there is nothing in the joint judgment that suggests that the merits-based approach to the application of Anshun estoppel has been eschewed.[167]

175 Two principal issues arise for consideration in connection with Anshun estoppel in this case. The first question is whether it was unreasonable of Mr and Mrs Collins or Mr Tomes not to have opted out or, given that they had not opted out, to have failed to participate more actively in the group proceeding, such that it can be said that they may not rely upon the defences that each now seeks to advance.[168] To answer that question, it will be necessary first to decide what courses are open to a group member wishing to raise individual claims in a group proceeding. The second question concerns the matter not decided in Tomlinson, namely whether a group member is the privy of the representative party and therefore bound by any estoppels binding that party.

176 Timbercorp Finance said that there were two basic fallacies in the primary judge's understanding: (a) he considered that the plaintiff was unable to propound claims that were not common to the plaintiff and to group members and (b) he considered that group members were unable to participate in the proceeding.

177 Timbercorp Finance contended that, within pt 4A, there were a number of measures which served to protect group members who wished to agitate claims not pleaded by the plaintiff in the group proceeding. Some of these measures may be described as 'exit provisions'; others as 'non-exit'. It was submitted that, by themselves, the exit provisions are decisive in favour of engaging the Anshun doctrine. When they are read with the non-exit measures, the case for the application of Anshun becomes even stronger. The exit provisions entitle a party to opt out of the group proceeding. They preserve the autonomy of a party to conduct its litigation without reference to the plaintiff in the group proceeding and to sever any privity and exclude any estoppels that would otherwise exist. By not opting out, group members were to be taken as having accepted that the claims advanced by the plaintiff in the group proceeding represented the totality of their claims against Timbercorp Finance and that they were barred from making further allegations by the dismissal of those claims.[169]

178 Second, Timbercorp Finance contended that, even if putative group members who chose not to opt out of the group proceeding were not precluded by that choice alone from pursuing other defences, they had the power to seek directions from the Court pursuant to s 33Q that their individual defences be case managed by the judge in charge of the group proceeding, and their failure to do so was so unreasonable that their defences should now be stayed pursuant to Anshun estoppel.

179 Timbercorp Finance said that there is a clear connectedness or relationship between the claims agitated in the group proceeding and the claims now being agitated in the separate defences, which affords the basis for Anshun estoppel to apply. The essence of the present defences is that there is no liability to Timbercorp Finance; that was the very subject matter of the group proceeding:

The essence of the group proceeding was that there was a liability that needed to be dispelled, to be voided, rendered void and that's why there was invocation of the statutory heads of relief to get rid of the liability that was otherwise there, not to award damages but to negate the liability.

180 It was contended that, as well as a correspondence in the substantive relief claimed, there was a connectedness of subject matter in the claims themselves. In the case of Mr and Mrs Collins, they allege that no loan was made because the loan moneys were wrongly used in the course of the business of Timbercorp Ltd. In the group proceeding, it had been contended that the alleged representation that scheme members' contributions would be applied to the relevant scheme was false for the same reason, namely that all cash flows in the Timbercorp Group went through a central bank account. Further, it was alleged in the group proceeding that, because scheme expenses needed to be met from positive cash flows within the group, investments in the scheme were vulnerable to variations in those cash flows. Mr and Mrs Collins sought to rely on financial difficulty in the Timbercorp Group as one basis for alleging their own vulnerability to economic loss. They also asserted that, because the Timbercorp Group knew its own financial difficulties and they did not, they were in a comparatively weak bargaining position, which formed part of the claim of unconscionability.

181 In relation to Mr Tomes, it had been alleged in the group proceeding that Timbercorp Finance had represented that scheme contributions would be applied to fund the relevant scheme and that the contributions would be sufficient to do so. In the recovery proceeding, Mr Tomes alleges that it was represented to him that the projects were standalone, fully funded and sustainable because the application moneys, rent and management fees were applied only to the relevant project. In the group proceeding, it had been alleged that Timbercorp Finance had represented that the schemes were viable in the long term. Mr Tomes relied on a representation that the schemes would continue even without Timbercorp Securities as the responsible entity. Again, Mr Tomes relied on the fact that application moneys were applied for the purposes of Timbercorp generally in support of his 'void ab initio' argument. In the group proceeding, that fact had been alleged to establish the falsity of the contrary representation which was alleged. Finally, in both proceedings, a declaration had been sought that Timbercorp Finance was involved in a contravention of s 601FC of the Corporations Act. In the group proceeding, this was because of its knowing involvement in the alleged failure of Timbercorp Securities to disclose adverse events. In the recovery proceedings, Mr Tomes alleged knowing involvement in the breach of trust said to have been committed by Timbercorp Securities in paying loan moneys other than for the relevant schemes.

182 Third, Timbercorp Finance contended that the respondents were privies of the plaintiff in the group proceeding and, in so far as it was unreasonable for the plaintiff not to have advanced their individual claims in the group proceeding such that the plaintiff would be estopped from now doing so, they were themselves likewise estopped.[170]

Are group members estopped simply by not opting out?

183 There is nothing in pt 4A that supports the contention that where a group member has not opted out, the group member will be taken to have accepted that the determination of the group proceeding will be the complete resolution of all or any claims that the group member has in respect of the group claim or any similar or related claim.

184 It is to be recalled that Anshun estoppel applies not to what was decided in the first proceeding but to what was not decided.[171] Plainly, s 33ZB erects a statutory estoppel. It does so in respect of a 'judgment given in a group proceeding'. It says nothing about there being any estoppel outside the judgment.

185 The provisions of pt 4A are of general application. Jurisdiction depends on (a) there being seven persons who have claims against the same person; (b) the claims of all those persons being in respect of, or arising out of, the same, similar or related circumstances; and (c) the claims of all those persons giving rise to a substantial common question of law or fact. However, there may be other claims: the plaintiff(s) may have other claims, and the group members may have other claims, including claims arising 'out of the same, similar or related circumstances'. It would be a dramatic consequence if the effect of not opting out of a group proceeding was to 'homogenise' all the claims. Take a simple case of breach of duty of care in tort. As in Naken, it may be being contended that a manufacturer has constructed a mass produced car negligently. Claims brought by owners of such a car have a common issue: was the car constructed negligently? But, thereafter, their claims may diverge quite radically. Some may contend that their loss arises from reduced value on resale; others may have claims for personal injuries. In such a simple case, it makes sense for the question about negligent construction to be decided as a common question in a group proceeding. It is not apparent, however, why, if the plaintiff's claim is confined to loss of value on resale, group members who are seeking damages for personal injuries should be taken to have renounced such claims and to have confined their claim to loss of value on resale, on the basis that they did not opt out of the group proceeding. If the Act intended such a dramatic result, it might have been expected that it would have said so expressly, and have made provision to ensure that group members had such potential consequences drawn to their attention. Such an intention is all the less likely when one contemplates the extensive range of claims that might be excluded in a more complex case, such as the present. Instead, the statutory purpose of facilitating the resolution of common questions by means of group proceedings is advanced by a construction which does not bar all further claims by group members, thereby affording a substantial incentive to opt out.

186 The above conclusion might be thought to be at odds with views expressed by members of this Court in the Great Southern proceeding.[172] To the extent that those were views expressed about the general position under pt 4A of the Act, it follows from what we have said above that we respectfully disagree. It should be noted, however, that each case turns on its facts. In Great Southern, the language of the opt out notice was cast in different terms,[173] and particulars had not been provided of the individual claims or defences which it was contended could be barred by the settlement.[174] The decisions reached by the Court must be understood in that context.

187 It follows that, aside from the operation of s 33ZB, the Act does not have the result that a failure to opt out gives rise to an estoppel in respect of the individual claims of a group member. The application of Anshun in this context requires consideration of the whole of the circumstances. The first submission of Timbercorp Finance should be rejected.

188 We also reject Timbercorp Finance's contention that the failure of a group member to invoke s 33Q, and provisions associated with it,[175] in aid of an unpleaded claim makes it unreasonable to agitate that claim in a later proceeding. However, our reasons for reaching that conclusion differ from those of the primary judge.

189 The primary judge held that the phrase 'remaining questions' in s 33Q was a reference to 'questions which form part of the claim pressed by the plaintiff and which are left remaining after the determination of "the question or questions common to all group members"'.[176] Accordingly, s 33Q could not be invoked by group members for the management of their individual claims.[177]

191 Section 33Q draws a distinction between, on the one hand, 'the question or questions common to all group members' and, on the other, 'the remaining questions'. The words of the section do not contain within them the restriction placed upon them by the primary judge. On the contrary, the phrase 'remaining questions' could include not only claims made by the plaintiff other than the common questions but also individual claims made by group members. The jurisdiction conferred by s 33Q arises if something 'appears to the Court'. The section does not restrict the circumstances in which something may be caused to 'appear[] to the Court'. In this respect, s 33R is telling. It will be noticed that s 33R commences with the phrase '[i]n giving directions under section 33Q'. In other words, it contemplates the giving of directions under s 33Q in respect of claims other than those propounded by the plaintiff. First, it operates with respect to 'a question that relates only to the claim of [a group] member'; ex hypothesi such a claim would not be a claim of the plaintiff. Second, it provides that, when such a direction is given, 'the individual group member, and not the plaintiff, is liable for costs associated with the determination of the question'. Necessarily, the group member must be present before any such liability for costs could be imposed. The better view is that s 33Q contemplates that the Court will have power to give directions with respect to an unpleaded claim of a group member.[178] Section 33S makes provision for those circumstances where 'a question cannot properly or conveniently be dealt with under section 33Q or 33R'. It confers power on the Court to give directions for the commencement and conduct of another proceeding. While the section could be deployed in aid of the resolution of a claim pleaded by the plaintiff but which the Court considers unsuitable to be determined during the group proceeding, there is no reason for it not to be deployed in aid of the resolution of unpleaded claims of group members.

192 Accordingly, one of the bases upon which the primary judge dismissed the contentions of Timbercorp Finance cannot be sustained: there was no barrier to group members bringing their unpleaded claims to the attention of the Court.

Are plaintiffs in a group proceeding confined to claims in which they have an interest?

193 The primary judge also held that, in a group proceeding, the jurisdiction of the Court not only depends on the existence of common issues of fact or law but is confined to the determination of them. Accordingly, it was not open to a plaintiff to advance claims available to particular group members but not available to the plaintiff himself.[179] In our opinion, that is also mistaken. It confuses the condition precedent to the exercise of jurisdiction in a group proceeding with the authority to resolve it. There is nothing in pt 4A that so confines the jurisdiction of the Court, and it would unnecessarily restrict the Part to import any such limitation.[180] Further, it is plain that s 33Q and the provisions that follow and supplement it contemplate the possibility of the involvement of group members in the group proceeding.

194 It follows that the second submission of Timbercorp Finance, in so far as it concerns the proper construction of the relevant statutory provisions, is correct. It is now necessary to consider the remaining submissions upon which Timbercorp Finance relied for the application of Anshun estoppel.

Was the relief sought in the group proceeding substantially the same as that underlying the individual defences?

195 Timbercorp Finance submitted that the relief sought in the group proceeding was substantially the same as that claimed in the individual defences, namely whether there was a liability under the loan agreements. However, even if this is accepted it does not advance the matter. Such a conclusion can be drawn only at an unhelpfully high level of generality. It is true that the relief sought in the group proceeding included avoidance of any liability to repay the loans, and that it is now sought to avoid that same liability. But that only reveals the potential for Anshun estoppel to arise. The correspondence in the underlying issue in dispute is not decisive. (It will be recalled that Timbercorp Finance does not assert issue estoppel, res judicata or statutory estoppel under s 33ZB.)

196 It is true, as Timbercorp Finance submitted, that there are connections between some of the claims made by the plaintiff in the group proceeding and some of the individual claims of Mr and Mrs Collins, and Mr Tomes. For the most part, however, those connections are not substantial or fundamental. Although Mr and Mrs Collins rely on the use of application moneys in the course of the Timbercorp Ltd business generally, that is in support of an argument about alleged departures from stipulated procedures, said to have meant that no loan was made to them at all. In the group proceeding, the same matter was relied on to falsify an alleged representation in the PDS. The underlying claims are quite different, despite the factual connection between them. In the case of the economic loss claim advanced by Mr and Mrs Collins, their reliance on the vulnerability of the scheme to the cash flows within the Timbercorp Group in order to establish their own vulnerability to economic loss is quite distinct from the group proceeding allegation of non-disclosure of the alleged vulnerability of the schemes to group cash flows. The unconscionability claim does intersect with that alleged non-disclosure, in so far as it alleges that Mr and Mrs Collins did not know of Timbercorp's true financial position, but it is only one aspect of the claim and, more importantly, it depends on the state of the parties' respective knowledge rather than any duty of disclosure or breach of such duty. The connection between those claims is therefore not substantial.

197 Mr Tomes relies on representations he says were made specifically to him. They bear a closer similarity to some of the representations made in the group proceeding, but the fact that he relies on explicit representations made to him personally, rather than representations said to be contained in the PDSs, indicates a critical difference in his claims. While the contents of the PDSs might bear upon his case, and there may be a factual overlap in that regard, his claim depends on other events. The connection is weaker in the case of his other claims. His 'void ab initio' argument depends, not on any representation, but on the construction of the relevant scheme documents and an alleged breach of an essential contractual term. The fact that, if the moneys were used as Mr Tomes alleges, this would also have gone to show the falsity of representations alleged to have been made in the group proceeding, does not reveal any fundamental connection between the claims. Again, they are based on quite different causes of action. In so far as s 601FC of the Corporations Act is concerned, only the provision affording relief is the same. The underlying breaches of trust that are alleged are distinct.

198 While the individual claims of the respondents are all directed at the same ultimate result, there are therefore very substantial differences between them. They reveal fundamentally different underlying legal foundations, and factual connections that are largely superficial. The closest connection is in the representations upon which Mr Tomes relies, but the factual foundation for the two claims is very different despite the connection. There is not a substantial correspondence or connectedness of subject matter of the kind alleged by Timbercorp Finance. It is consistent with our conclusions in this regard that Timbercorp Finance did not contend that any issue estoppel arose in respect of the respondents' claims by virtue of their having been group members in the group proceeding.

199 The Anshun inquiry takes account of all the circumstances, and the submissions of Timbercorp Finance which we have considered above should not be treated in isolation. The circumstances need to be considered against the background that we have held that there were mechanisms available by which group members, including the respondents, could have brought their individual claims to the attention of the Court hearing the group proceeding and sought to have them resolved in that proceeding. We have also held that the Court would have had jurisdiction to deal with individual claims extending beyond the common questions.

200 It is to be recalled that Anshun estoppel is not to be applied according to some formula or mechanistically. As Ormiston JA said in Gibbs v Kinna, its application is based 'not so much on legalities as upon practicalities'.[181] More recently, Australian courts have adopted the 'broad merits-based' approach described by Lord Bingham in Johnson v Gore-Wood & Co.[182] They have rejected any approach that may be characterised as 'formulaic' or 'mechanistic'.[183] The failure to seek to use available mechanisms to bring the individual claims to the attention of the Court hearing the group proceeding does not, without more, suffice to give rise to an Anshun estoppel.

201 In considering the question of unreasonableness, it is important to consider the opt out notice and the revised opt out notice that were sent to the parties.[184] Both notices described the plaintiff's claim as arising from the 'false, misleading, or deceptive representations to him and to group members in relation to the Schemes'. The group members were then warned as to the consequences that will flow if they do not opt out. The notices indicated that they would be bound by the outcome of the class action, stating '[i]f the class action is unsuccessful or is not as successful as you might have wished, you will not be able to make the same claim in any other proceedings'.[185] The notice contained nothing that would have warned a group member that, in addition to being bound by the determination of the plaintiff's claim, they would be precluded from bringing their individual defences, if they did not apply, say, at a directions hearing to have their individual defences case managed as part of the group proceeding. While a finding of Anshun estoppel should not be made without 'a scrupulous examination of all the circumstances',[186] the content of the opt out notice bears very significantly on the reasonableness, or otherwise, of the course taken by the present respondents.[187]

202 The question of reasonableness must also be informed by considering what prejudice may have been caused to Timbercorp Finance as a result of the respondents not having taken the steps in the group proceeding which we have found were open to them as group members. In our opinion, the potential for prejudice is very low. Assuming that the respondents had made an application that their individual defences be case managed as part of the group proceeding, and that the trial judge had agreed to do so, it is highly likely, if not inevitable, that the individual defences would have had to be heard and determined separately from the hearing and determination of the common claims. It is necessary to recall the public interests that are advanced by Anshun estoppel. It is not in the public interest that a party be vexed more than once with the same claim. But Timbercorp Finance would still have had to respond to the individual claims either as part of the group proceeding or in a separate proceeding. The situation is much the same as that analysed in the Court of Appeal of England and Wales in Barrow v Bankside Agency Ltd.[188] In that case, Barrow brought his 'portfolio selection' claim in separate proceedings after the determination of the 'negligent indemnity' claim in which he was one of about 3000 co-plaintiffs. As Phillips J said in the Commercial Court, there was one issue that was common to all parties: 'was the business of underwriting conducted with reasonable skill and care?'[189] It was[190]

in the interests of all parties, and designed to achieve a massive reduction in multiplicity of proceedings and saving of costs, that the common issue should be litigated in a single action. This could only be achieved if the individual claims that names might have against their members' agents were not included in that action.

In the Court of Appeal, Sir Thomas Bingham MR pointed out that the defendant always had to face both claims. Either it faced the claim in the original proceedings in which Barrow was a co-plaintiff, or it faced it in a subsequent proceeding. Barrow was not 'causing there to be two trials where there would have been one'.[191] He was not 'exposing the defendant to an unnecessary series of trials'.[192] Accepting that the defendant may be dismayed by the emergence of the second claim, he said: 'but the claim would not have been other than unwelcome whenever presented'.[193]

203 The separate treatment of individual claims in group proceedings is familiar. As Murphy J explained in Kelly v Willmott Forests Ltd (in liq) (No 4):[194]

Ordinarily, courts take the approach of leaving the identification of class members' individual issues or claims until after an initial trial in which the Court hears and decides the common issues and the applicant's individual claims: Merck Sharp & Dohme (Australia) Pty Ltd v Peterson [2009] FCAFC 26, [7] (Moore, Sundberg and Tracey JJ). After the decision on the common issues the Court can decide whether there are any individual claims and may give directions to deal with them in separate proceedings or within the framework of the class action. As Lindgren J said in Bright v Femcare Ltd [2002] FCAFC 243; (2002) 195 ALR 574, 580 [18]:

... ordinarily one would expect that, in an attempt to give effect to the legislative intention, a means will be sought, by case management techniques, to enable a representative proceeding to continue to the stage of resolution of the substantial common issues on the basis that after that stage is completed, an order under s 33N or directions under s 33Q will be made ...

204 In the present case, the respondents' individual defences are no doubt unwelcome, but Timbercorp Finance is not materially worse off as matters now stand. Either it had to face the defences in the group proceeding or in a separate proceeding. It has yet to face them; it cannot be said that the conduct of the respondents is unfairly prejudicial to Timbercorp Finance. The written and oral submissions of Timbercorp Finance were directed at establishing that the Court had power under s 33Q to manage the individual claims and that the respondents should be estopped because they did not ask the Court to do so. But, as the courts have constantly repeated, the application of Anshun estoppel does not turn upon whether a matter could have been raised in an earlier proceeding but whether it was unreasonable of the party subsequently raising the matter not to have done so. Timbercorp Finance did contend that, if it did not succeed in its present application, it would be oppressed by having to face 'over 1000 defended debt claims'. It may be accepted that such claims would have to be faced. But that of itself is not prejudice so as to make it unreasonable for the respondents not to have raised their claims in the group proceeding.[195]

205 Further, it will be noticed that the analysis in the previous paragraph proceeds on the assumption that the judge in charge of the group proceeding would have agreed to case manage the individual defences of the respondents. But it is speculative to make that assumption. Although s 33Q confers jurisdiction on the Court to make such directions, it does not expressly confer standing upon group members to invoke the exercise of the jurisdiction. It is entirely possible that, if the respondents had attended the Court at a directions hearing, the Court would have refused to make orders directing that their individual defences be case managed as part of the group proceeding. The Court might have reasoned that it had enough to do managing, hearing and determining the common issues. During the trial and again on hearing of the appeal, counsel for Mr Tomes advanced what the primary judge described as a vivid example of all group members - and there were hundreds of them - attending the court on a directions day and asking that their individual claims be heard and determined as part of the group proceeding. Even if their requests were dealt with on the papers, their number would have the capacity to disrupt the orderly conduct of the group proceeding. The process would depend upon the exercise of a judicial discretion the outcome of which cannot be anticipated.

206 Australian courts have repeatedly refused to apply Anshun estoppel where the ability of the relevant party to participate in the earlier proceedings depended upon the favourable exercise of discretion by the court seized of those proceedings. It cannot be said that the route marked out for the respondents by Timbercorp Finance was as 'tortuous' as that facing the appellant in Ling.[196] Nor can it be said that the jurisdiction of the Trial Division of this Court to determine the individual defences as part of the group proceeding was debatable in the way the jurisdiction of the Federal Court was thought to be debatable in Meriton Apartments.[197] But there are good reasons for thinking that, if application had been made to the judge in charge of the group proceeding, it might well have been refused. In Champerslife, the Court held that the conduct of Champerslife Pty Ltd could not be said to have been unreasonable in not seeking joinder to the existing proceedings or in failing to bring its own proceedings and applying to have them joined to the existing proceedings in the Local Court.[198] As Giles JA said, the matter would have been complex: the prospects of a successful application for consolidation 'were as doubtful as the prospects of a successful joinder application'.[199] In reaching that conclusion, he referred to the reasons in Meriton Apartments in which, he said, 'it was observed that it would be strange if a litigant in the Federal Court was bound, at the risk of an Anshun estoppel, to invoke its accrued jurisdiction, when the Court can decline to exercise that jurisdiction'.[200]

207 Further, as was pointed out in Anshun itself, there may be good reasons why a party does not raise every relevant issue that arises out of the facts and circumstances that give rise to the claim that must be faced. In Anshun, Gibbs CJ, Mason and Aickin JJ referred to the fact that '[t]o require that the defendant always raise his cross-claim or set-off at the first available time could cause great inconvenience'.[201] They referred to those cases, such as Davis v Hedges,[202] where particulars for a claim for breach of warranty had not emerged at the time a claim for the price of goods or services was being prosecuted. In the present case, it was far from clear that the respondents were aware of the facts and circumstances that gave rise to their individual defences when they had to make a decision about whether to opt out.[203]

208 Timbercorp Finance submitted that the Court should take into account that the respondents had retained the same solicitors as the plaintiff had in the group proceeding and that they had retained those solicitors 'to advance their individual issues as well as their common issues'. While the correspondence is far from clear, it is to be noted that Timbercorp Finance has not sought to impugn the primary judge's statement that he had doubts whether those solicitors were 'supposed to deal with clients' idiosyncratic issues within the group proceeding'.[204] But in any event, the retention of solicitors to deal with both group and individual issues need not imply that those issues should all be brought forward in the same proceeding.

209 In Anshun, the Court treated the possibility of there being inconsistent judgments as a sound basis for considering later proceedings vexatious of a party. Timbercorp Finance did not contend that the individual defences now propounded by the respondents might result in there being judgments inconsistent with that delivered in the group proceeding.[205]

210 We have already held that the connections between the claims advanced in the group proceeding and the individual claims of the respondents are not substantial or fundamental in nature. Any risk of inconsistent findings, undesirable as that is, must be viewed from that perspective.

211 It follows that, despite the potential for the respondents to have sought to raise their individual claims in the group proceeding, and despite the fact that the Court might, by reason of connections between those claims and the issues to be determined in the group proceeding, have heard and determined the individual claims, it was not unreasonable of the respondents, in all the circumstances, to defer reliance on their individual claims until such time as Timbercorp Finance sought to enforce the loan agreements against them.

Were the group members privies of the plaintiff?

212 The final submission of Timbercorp was that the respondents were privies of the plaintiff in the group proceeding and that the plaintiff was subject to Anshun estoppel which therefore also bound the respondents.

213 The analysis of pt 4A set out above[206] shows also that the group members in the group proceeding were not privies of the plaintiff in respect of unpleaded claims and defences, and that Tomlinson does not hold otherwise. The plaintiff was not the agent of the group members; nor was he their fiduciary. The group members had no control over the conduct by the plaintiff of the group proceeding.[207] They have no enforceable rights against him in the event that they consider that he has not advanced, or not properly advanced, their unpleaded claims. In advancing their amended defences, the group members are not claiming 'under or through' the plaintiff in the group proceeding. It is true that, by reason of the provisions of pt 4A, the plaintiff represented group members in that proceeding. And, to the extent of that representation, group members, in so far as they take its benefit, must also share in its burden. Nevertheless, the plaintiff did not represent group members in respect of their unpleaded defences and claims.

214 If, contrary to our conclusions, the group members were privies of the plaintiff in that regard, it is necessary to consider whether the plaintiff in the group proceeding would himself be subject to Anshun estoppel of the type now asserted against Mr and Mrs Collins and Mr Tomes. In this context, it is necessary to consider the hypothetical scenario in which the plaintiff sought to advance the respondents' individual defences at this point, perhaps in the course of a fresh group proceeding satisfying the criteria required by s 33C.

215 It will be recalled that we do not agree with the primary judge's conclusion that the plaintiff was unable under pt 4A to advance in the group proceeding further claims of the type now sought to be relied upon by the respondents. Moreover, in this context the wording of the opt out notice has less relevance because the plaintiff was, as a party, not faced with any election. At the same time, however, the opt out notice suggested that the Court would only be resolving the identified common claims, and it can be assumed that, if the plaintiff had sought to raise further claims, a fresh opt out notice would have been required.

216 Nevertheless, while the plaintiff could have raised such claims as a matter of principle, it does not follow that the specific issues in question were necessarily able to be raised at the time of the group proceeding, or that it was unreasonable not to have raised them then.

217 In relation to Mr Tomes, it is significant that his claims depended in part on personal communications made to him. These were matters known to Mr Tomes at the time of the group proceeding. However, they raised matters distinct from the claims advanced on behalf of the group members, and there is no suggestion that they are claims that other group members could also have advanced. There was therefore no reason why these claims should have been advanced along with the common questions. The opt out notice framed the group proceeding as one about the common questions, and nothing else. In such circumstances, it was not the responsibility of the plaintiff to marshal other claims particular to individual group members and advance them on their behalf along with the common questions. It did not become his responsibility simply because M+K were aware of further claims upon which Mr Tomes wished to rely. Had the claims been advanced, their distinct nature means that in all likelihood their resolution would have been deferred until after resolution of the common questions. In the circumstances, it has not been shown that the plaintiff would be estopped were he now to seek to advance the further claims of Mr Tomes on his behalf.

218 The position regarding Mr and Mrs Collins is less clear. There is no evidence that the plaintiff was aware of the circumstances giving rise to their particular defences. Nor does the evidence indicate that M+K were aware of those circumstances while the group proceeding was being pursued. However, Timbercorp Finance contends that M+K could, and should, have advanced the claims of Mr and Mrs Collins via the plaintiff.

219 Documents upon which Mr and Mrs Collins's defences were partly based were not obtained by them until after the recovery proceedings had been commenced. Mr and Mrs Collins by their notice of contention invite this Court to find that they could not have discovered the documents earlier. It is not necessary to resolve the issue in the notice of contention, because we have already held that no estoppel arises by virtue of the failure of Mr and Mrs Collins to advance their claims in the group proceeding. But the question of notice of the relevant documents bears on the present issue in a different way.

220 For present purposes, what matters is that, whether or not Mr and Mrs Collins could during the group proceeding have identified the defences now relied upon, it is contended that M+K could have done so. In that regard, Timbercorp Finance argues that M+K was provided with the relevant documents and could have identified the 'no loan' defence, in particular. It notes that the defences advanced by Mr and Mrs Collins are now raised by 195 defendants for whom M+K act in recovery proceedings.

221 The reasonableness of the plaintiff in not raising the defences in the group proceeding again depends on all the circumstances. It is significant that the Collins's claims are not, as we have found, fundamentally connected with the claims that were advanced in the group proceeding. On the other hand, the plaintiff was responsible for advancing claims on behalf of the group and could have raised the claims now advanced by Mr and Mrs Collins on behalf of at least 195 persons. That consideration tends to negate the relevance of the comparative lack of connection between the existing common claims and the further claims. It suggests that the further claims could, and perhaps should, have been pursued as additional common claims.

222 However, even if all of the 195 defendants were group members, it has not been established when the further claims could, let alone should, have been identified. The reasonableness of the failure of the plaintiff, through M+K, not having pursued the claims would need to be determined by reference to the circumstances, including the stage reached by the proceeding, at that point. This Court is in a difficult position in this regard because there is a lack of findings by the primary judge, partly by virtue of the different view he took of the legislative provisions.[208] The matter seems primarily to have been argued on the basis of the knowledge of, or to be attributed to, Mr and Mrs Collins rather than the plaintiff. M+K itself did not lead evidence as to the position. But the onus rested on Timbercorp Finance, as the party alleging the estoppel.

223 On balance, we consider that it has not been established by Timbercorp Finance that the plaintiff acted unreasonably in not identifying and advancing the Collins's claims as part of the same proceeding.

224 In all the circumstances, it was not unreasonable for the plaintiff not to have raised the respondents' further claims in the group proceeding. Even if the plaintiff and the group members were privies, the group members would therefore not be estopped from advancing those claims in a subsequent proceeding.

225 Timbercorp Finance also contended that the respondents should be precluded from raising their present defences as to do so was to abuse the processes of the Court.[209] In making that contention, it referred to much the same considerations that it had relied upon in support of its claim that the respondents should be subject to Anshun estoppel.[210] It said that the application of the principles that prevent there being an abuse of process can preclude proceedings even where there is no estoppel.[211] Timbercorp Finance contended that the conduct of the respondents was unjustifiably oppressive to it and had the tendency to bring the administration of justice into disrepute. It would be unjust and oppressive for Timbercorp Finance now to have to face over 1000 defended debt claims[212] having already litigated their enforceability against those same defendants in the group proceeding.

226 In Rogers v The Queen, McHugh J summarised the categories of abuse as follows:[213]

Inherent in every court of justice is the power to prevent its procedures being abused. Although the categories of abuse of procedure remain open, abuses of procedure usually fall into one of three categories: (1) the court's procedures are invoked for an illegitimate purpose; (2) the use of the court's procedures is unjustifiably oppressive to one of the parties; or (3) the use of the court's procedures would bring the administration of justice into disrepute. Many, perhaps the majority of, cases of abuse of procedure arise from the institution of proceedings. But any procedural step in the course of proceedings that have been properly instituted is capable of being an abuse of the court's process.

227 Before the primary judge, Timbercorp Finance contended that, by raising their separate defences in the recovery proceedings, the respondents were using the procedures of the Court in a manner that (a) was unjustifiably oppressive of it and (b) would bring the administration of justice into disrepute.[214]

228 In Kermani v Westpac Banking Corporation,[215] Robson AJA (with whom Neave and Harper JJA agreed) outlined a series of propositions drawn from the authorities where it had been contended that an abuse has arisen by reason of litigation that was said to be unjustifiably oppressive of a party. He said:[216]

The guiding considerations are oppression and unfairness to the other party to the litigation and concern for the integrity of the system of administration of justice. Regard may be had to:

(a) the importance of the issue in and to the earlier proceeding, including whether it is an evidentiary or ultimate issue;

(b) the opportunity available and taken to fully litigate the issue;

(c) the terms and finality of the finding as to the issue;

(d) the identity between the relevant issues in the two proceedings;

(e) any plea of fresh evidence, including the nature and significance of the evidence and the reason why it was not part of the earlier proceeding;

(f) the extent of the oppression and unfairness to the other party if the issue was relitigated and the impact of the relitigation upon the principle of finality of judicial determination and public confidence in the administration of justice; and

(g) an overall balancing of justice to the alleged abuser against the matters supportive of abuse of process.

229 Timbercorp Finance did not address argument at those principles; its case was put at a much higher level. It has not established to the satisfaction of the Court that, by maintaining their individual defences, the respondents are acting oppressively or otherwise bringing the administration of justice into disrepute. Timbercorp Finance had to meet the allegations contained in the present defences either as part of the group proceeding or in separate proceedings. Again, in some ways the present situation corresponds to that considered by Sir Thomas Bingham MR in Barrow v Bankside Agency Ltd.[217] The respondents are not causing there to be two trials where there would have only been one. They are not exposing Timbercorp Finance to an unnecessary series of trials. Timbercorp Finance is no worse off as matters stand than if the respondents had sought to introduce their individual defences into the group proceeding. Their claims are unwelcome, but they would have been unwelcome whenever they were advanced. Timbercorp Finance has yet to meet those claims. The defences now raised are 'unadjudicated'. It is not oppressive that Timbercorp Finance must meet them now.

230 In our opinion, leave to appeal should be granted and the appeal should be dismissed.

[1] Managed Investments Act 1998 (Cth).

[2] Woodcroft-Brown v Timbercorp Securities Ltd [2011] VSC 427.

[3] Woodcroft-Brown v Timbercorp Securities Ltd [2013] VSCA 284 (Warren CJ, Buchanan JA and Macaulay AJA).

[4] Woodcroft-Brown v Timbercorp Securities Ltd [2014] HCATrans 85.

[5] [1981] HCA 45; (1981) 147 CLR 589 ('Anshun'). Timbercorp Finance did not submit that the respondents were precluded by res judicata or issue estoppel.

[6] On 30 October 2015, the Court (Judd J) made orders in the Collins proceedings granting Timbercorp Finance leave to join Timbercorp Securities as the third defendant. The solicitors for Timbercorp Securities informed the Court that their client did not propose to participate in the present appeal to the extent that it related to the Collins proceedings and that it agreed to be bound by any decision made in this appeal.

[7] Timbercorp Finance Pty Ltd (in liq) v Collins [2015] VSC 461 ('Reasons').

[9] A copy of the 17 June 2009 letter was provided to Mr Collins.

[11] The following account of the group proceeding is taken from the account contained in the judgment of the Court of Appeal: Woodcroft-Brown v Timbercorp Securities Ltd [2013] VSCA 284 (Warren CJ, Buchanan JA and Macaulay AJA).

[13] In its reasons, the Court of Appeal said: 'The trial judge formed the view that the reformulation of the appellant's case was an attempt to "sidestep" the opinions found in the joint experts' report which his Honour held was "a complete answer to the structural risk case as pleaded." It was agreed by the experts that as long as the Group's bankers continued to support the Group's operations there was no significant risk that the Group would not have had the financial capacity to manage any of the schemes through to their contemplated completion. His Honour held that the "lack of materiality of investor defaults and the willingness of the banks to increase their level of support for the Group until the end of 2008 had the effect of eroding the content of the structural risk as pleaded and particularised by the plaintiff"': ibid [76].

[14] The present respondents were investors in some of the Sample Group Member Schemes.

[16] Section 33KA relates to the powers of the Court concerning group membership.

[21] Ibid [390]-[393]. Section 33ZF confers general power on the Court to make 'any order [it] thinks appropriate or necessary to ensure that justice is done in the proceeding'. It may make such an order 'of its own motion or on application by a party'.

[24] Ibid [414]-[417]. See above n 21.

[25] Ibid [420]; see also at [471].

[52] [2014] VSC 569.

[53] [2014] VSC 516.

[54] Reasons [682]; see generally at [665]-[682].

[55] Kelly v Willmott Forests Ltd (in liq) (No 4) [2016] FCA 323 [199]-[247] (Murphy J).

[56] The primary judge did not make any finding that M+K were retained to deal with their clients' individual claims: Reasons [716].

[57] There was very little argument advanced by either party in respect of grounds 2 and 4, and nothing turns on them. It is not necessary to mention them further.

[58] [1983] 1 AC 280.

[59] Part 4A is based approximately on O 18A of the Supreme Court (General Civil Procedure) Rules 1996. The provisions in pt IVA were enacted after consideration of Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46 (1988).

[81] Ibid s 33ZB(b). This section has been described as 'pivotal': Femcare Ltd v Bright [2000] FCA 512; (2000) 100 FCR 331, 338 [25] (Black CJ, Sackville and Emmett JJ).

[83] (2002) 211 CLR 1, 31-2 [39] (citations omitted); see generally at 30-2 [35]-[41] (citations omitted).

[84] [2015] HCA 28; (2015) 89 ALJR 750, 756-7 [22] ('Tomlinson').

[86] [1843] EngR 917; (1843) 3 Hare 100; 67 ER 313.

[87] They referred to the 'limited utility' of basing the principle of Henderson v Henderson on abuse of process: Anshun [1981] HCA 45; (1981) 147 CLR 589, 601.

[88] See, eg, Champerslife Pty Ltd v Manojlovski [2010] NSWCA 33; (2010) 75 NSWLR 245 ('Champerslife'); Ekes v Commonwealth Bank of Australia [2014] NSWCA 336; (2014) 313 ALR 665.

[89] [1843] EngR 917; (1843) 3 Hare 100, 115; [1843] EngR 917; 67 ER 313, 319.

[90] [1947] 2 All ER 255, 257. In Brisbane City Council v A-G (Qld) [1979] AC 411, 425, Lord Wilberforce referred to the judgment of Somervell LJ as providing 'the true basis of the doctrine and it ought only to be applied when the facts are such as to amount to an abuse: otherwise there is a danger of a party being shut out from bringing forward a genuine subject of litigation'.

[91] Anshun [1981] HCA 45; (1981) 147 CLR 589, 602-3.

[98] [1950] HCA 22; (1950) 81 CLR 446, 466, quoted in Anshun [1981] HCA 45; (1981) 147 CLR 589, 597. The first Latin maxim expresses the public interest in the finality of litigation; the second the interest that no one should be vexed twice for the same claim.

[99] [1996] 1 WLR 257, 260. In this case, Phillips J had rejected an application by the defendant to strike out the plaintiff's claim alleging negligent portfolio selection. Previously, the plaintiff had been one of 3000 or so co-plaintiffs in a claim involving allegations of negligent underwriting by, inter alia, the first defendant. The Court of Appeal dismissed an appeal from the ruling of Phillips J.

[100] [2002] 2 AC 1, 31. In this case, the plaintiff conducted a property development business through his company, W Ltd. He had the company commence proceedings against his solicitors for loss arising out of the negligent exercise of an option. Those proceedings were settled. Subsequently, the plaintiff commenced his own proceedings against the solicitors for professional negligence. The primary judge refused to strike out the proceeding on the basis of Henderson v Henderson. The Court of Appeal allowed an appeal but the primary judge's ruling was restored by the House of Lords.

[101] [2007] NSWCA 286 [44] (citations omitted).

[102] [1998] VSCA 52; [1999] 2 VR 19.

[103] Ibid 20 [1] (emphasis in original).

[105] (2009) 263 ALR 556, 564 [60] ('Meriton Apartments').

[107] [2010] NSWCA 33; (2010) 75 NSWLR 245, 247 [3] (Allsop P), 260 [79] (Giles JA), 264 [111]-[112] (Handley AJA).

[110] (1871) LR 6 QB 687, cited in Anshun [1981] HCA 45; (1981) 147 CLR 589, 600.

[111] Anshun [1981] HCA 45; (1981) 147 CLR 589, 600.

[112] (1871) LR 6 QB 687, 690. See also Champerslife [2010] NSWCA 33; (2010) 75 NSWLR 245, 253 [42] (Giles JA).

[113] [1996] FCA 1646; (1996) 68 FCR 180 ('Ling').

[114] The Commonwealth was the assignee of the rights of the students.

[115] The description was that of Hill J who decided an earlier application: Re Ling; Ex parte Ling v Commonwealth [1995] FCA 1410; (1995) 58 FCR 129, 135, quoted in Ling [1996] FCA 1646; (1996) 68 FCR 180, 184.

[116] This course was necessary to give the Federal Court jurisdiction in respect of the common law negligent misstatement claim under s 44(3) of the Judiciary Act 1903 (Cth): Re Ling; Ex parte Ling v Commonwealth [1995] FCA 1410; (1995) 58 FCR 129, 133.

[118] See, eg, City of Swan v McGraw-Hill Companies Inc (2014) 223 FCR 295.

[119] See Redowood Pty Ltd v Link Market Services Pty Ltd [2007] NSWCA 286; Solak v Registrar of Titles [2011] VSCA 279; (2011) 33 VR 40.

[120] Johnson v Gore Wood & Co [2002] 2 AC 1, 32 (Lord Bingham), 59-60 (Lord Millett); Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; (2001) 53 NSWLR 198.

[121] [2002] 2 AC 1, 32 (citations omitted).

[124] [2015] VSCA 140 [199], [201] (emphasis in original) (citations omitted) (Warren CJ, Tate JA and Ginnane AJA); see also at [223]: 'while it may be accepted that "considerations of convenience and justice" are at the foundation of Anshun estoppel, that does not mean that the Court may consider the unreasonableness question in an elastic way or merely on the basis of a value judgment aimed at avoiding the mischief of re-litigation. Rather, as described earlier in these reasons, the authorities require the Court to exercise great caution before finding that an Anshun estoppel operates. The respondents faced a heavy burden in contending for an Anshun estoppel'.

[125] [2010] NSWCA 33; (2010) 75 NSWLR 245.

[126] Ibid 255 [52] (citations omitted).

[127] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750; Johnson v Gore Wood & Co [2002] 2 AC 1, 32 (Lord Bingham), 60 (Lord Millett).

[128] Champerslife [2010] NSWCA 33; (2010) 75 NSWLR 245, 265 [117].

[129] There would, of course, be an anterior question relating to the beneficiary's standing to bring the action.

[130] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 760 [39].

[132] Johnson v Gore Wood & Co [2002] 2 AC 1, 32 (Lord Bingham).

[133] Champerslife [2010] NSWCA 33; (2010) 75 NSWLR 245, 255 [52] (Giles JA).

[134] Gleeson v J Wippell & Co Ltd [1977] 1 WLR 510, 515 (Megarry V-C).

[135] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 760 [39].

[136] [1939] HCA 23; (1939) 62 CLR 464, 531. The reference was to civil proceedings. As to criminal proceedings, see Rogers v The Queen (1994) 181 CLR 251. See also Tavares v Tavares [2003] VSCA 12; (2003) 6 VR 577, 580 [5] (citations omitted) (J D Phillips JA): 'As to the "issue estoppel" itself, one may start with the proposition that an issue estoppel, if properly so-called, binds the parties and their privies: Blair v Curran; Ramsay v Pigram. In this context that refers to those who are privy in interest and one who is not a party is the privy in interest of another who is a party if - and only if - the former claims "under or through" the latter: Ramsay. To that extent a privy is in a secondary position: or to put it in another way, the privy will be bound only if the party is bound'.

[137] [1968] HCA 34; (1968) 118 CLR 271, 279.

[138] Ibid. 'Privies by blood include ancestor and heir; privies in law, which includes testator and executor, intestate and administrator, bankrupt and trustee in bankruptcy; and privies in estate or interest, the most common category. Privies in estate or interest include testator and devisee, vendor and purchaser, landlord and tenant, assignor and assignee of a bond': Portbury Development Co Pty Ltd v Ottedin Investments Pty Ltd [2014] VSC 57 [123] (Garde J). Garde J held that a guarantor was not privy in interest with the principal debtor. However, as he pointed out, the holding that one party is not the privy of another is not conclusive of the question whether a party was bound by an issue estoppel arising from the determination of some issue arising in earlier proceedings to which he was not a party: at [148].

[139] (2002) 211 CLR 1, 30 [34] (emphasis in original).

[140] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 753 [1].

[142] As to the latter, see Carnie v Esanda Finance Corporation Ltd [1995] HCA 9; (1995) 182 CLR 398, 423-4 (citation in original).

[143] Zhang v Minister for Immigration, Local Government and Ethnic Affairs [1993] FCA 489; (1993) 45 FCR 384,

[144] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 769 [98].

[145] Mr Collins gave unchallenged evidence that, throughout the conduct of the class action, neither his wife nor he had any meetings with anyone from the lawyers who had the conduct of the group proceeding. They received no advice regarding their specific circumstances. Mr Collins said: 'We had no control of the issues raised in the class action. We had no involvement in the formulation of any of the common issues of fact or law that were determined in that proceeding. We had no say in how or when the Counterclaim filed in that proceeding by Timbercorp Finance Pty Ltd would be heard or determined or whether and how the determination of that Counterclaim would affect my wife and myself so far as concerned the loan we had sought from Timbercorp Finance Pty Ltd'. Mr Tomes gave similar evidence.

[146] [1995] HCA 9; (1995) 182 CLR 398, 423-4 ('Carnie').

[147] [1993] FCA 489; (1993) 45 FCR 384, 399-406 ('Zhang').

[148] [1983] 1 SCR 72 ('Naken').

[149] The common source was the Rules of the Supreme Court (UK) O XVI r 9.

[150] Naken [1983] 1 SCR 72, 105.

[152] Zhang [1993] FCA 489; (1993) 45 FCR 384, 385.

[154] Ibid 405-6. Where French J refers to the 'extended principle of res judicata', he is referring to Anshun estoppel: see at 402-3.

[155] Anshun itself had only been decided relatively recently.

[156] (1995) 182 CLR 398. Supreme Court Rules 1970 (NSW) pt 8 r 13(1) was in the following terms: 'Where numerous persons have the same interest in any proceedings the proceedings may be commenced, and, unless the Court otherwise orders, continued, by or against any one or more of them as representing all or as representing all except one or more of them'. The corresponding rule in Victoria under the former Rules of the Supreme Court 1957 was O 16 r 9 which provided: 'Where there are numerous persons having the same interest in one cause or matter, one or more of such persons may sue or be sued, or may be authorized by the Court or a Judge to defend in such cause or matter on behalf or for the benefit of all persons so interested'. Each version of the rule embodied the practice previously followed in the Court of Chancery: see Duke of Bedford v Ellis [1901] AC 1.

[157] Carnie [1995] HCA 9; (1995) 182 CLR 398, 412 (Toohey and Gaudron JJ).

[158] See Esanda Finance Corporation Ltd v Carnie (1992) 29 NSWLR 382 (Gleeson CJ and Meagher JA, Kirby P dissenting).

[159] The majority in the Court of Appeal had relied upon the decision of Estey J in Naken in holding that a representative proceeding (old style) could not be used in that case: Esanda Finance Corporation Ltd v Carnie (1992) 29 NSWLR 382, 388-90 (Gleeson CJ), 404 (Meagher JA). In their joint judgment in the High Court, Toohey and Gaudron JJ referred to Naken and to later decisions of provincial courts that had distinguished Naken: Carnie [1995] HCA 9; (1995) 182 CLR 398, 418-19.

[160] Carnie [1995] HCA 9; (1995) 182 CLR 398, 424.

[161] Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 755-6 [17]. See [141]-[146] above.

[167] Johnson v Gore Wood & Co [2002] 2 AC 1, 31; Champerslife [2010] NSWCA 33; (2010) 75 NSWLR 245, 247 [3] (Allsop P), 260 [79] (Giles JA), 264 [111]-[112] (Handley AJA).

[168] See [140] above.

[169] Timbercorp Finance said that this approach involved no unfairness, because a group member who sought the benefits that flow from a group proceeding must be subject to corresponding detriments and, further, a defendant having to meet what may be a very substantial mass of claims should not be vexed more than once. It said that in Tomlinson, the majority had treated the right to opt out as decisive of the question whether there were adequate protections against the collateral risks of representation.

[170] Timbercorp Finance said that the primary judge had misconstrued Tomlinson. It said that the majority were referring to all forms of estoppel, including Anshun. Further, it contended the fact that group members did not authorise the plaintiff was irrelevant. Finally, it said that although a plaintiff in a group proceeding was not subject to fiduciary duties, there were other procedures which guarded against the collateral risks of representation.

[171] Johnson v Gore Wood & Co [2002] 2 AC 1, 28 (Lord Bingham), quoting Manson v Vooght [1998] EWCA Civ 1665; [1999] BPIR 376, 387-8 (May LJ).

[172] Clarke v Great Southern Finance Pty Ltd (in liq) [2014] VSC 569; Clarke v Great Southern Finance Pty Ltd (rec and mgr apptd) (in liq) [2014] VSC 516.

[173] Clarke v Great Southern Finance Pty Ltd (in liq) [2014] VSC 569 [19]; Clarke v Great Southern Finance Pty Ltd (rec and mgr apptd) (in liq) [2014] VSC 516 [94].

[174] Clarke v Great Southern Finance Pty Ltd (rec and mgr apptd) (in liq) [2014] VSC 516 [119]; Clarke v Great Southern Finance Pty Ltd (in liq) [2014] VSC 569 [54].

[176] Reasons [575]; see generally at [418]-[433].

[177] Mr Tomes supported this reasoning on the appeal.

[178] As will be observed, s 33Q does not stipulate the means whereby something might come to 'appear to the Court'. In that respect, ss 33L and 33Q differ from other sections that stipulate who has standing to seek relief from the court: see, eg, Act ss 33KA ('application of a party'), 33M-33N ('application by the defendant') and 33T ('application by a group member').

[179] 'Group proceedings cannot encompass idiosyncratic claims that lack even this minimum degree of commonality [the commonality identified as necessary to commence the proceeding in s 33C(1)]': Reasons [465]; see also at [549], [580], [604], [625], [634]. 'The defendants [Mr and Mrs Collins and Mr Tomes] had no power to influence the way the case was run, to determine what evidence was led or what issues were resolved_. In fact, the plaintiff_ [in the group proceeding] could not have raised many of the defences sought to be raised by the defendants and particularly Mr Tomes by reason of the necessity for the claim to be common to seven group members including the plaintiff': at [649] (emphasis added).

[180] See Johnson Tiles Pty Ltd v Esso Australia Pty Ltd (No 3) [2001] VSC 372 [45]-[52] (Gillard J); Hall v Australian Finance Direct Ltd (No 3) [2007] VSC 366 [18]-[25] (Hollingworth J).

[181] [1998] VSCA 52; [1999] 2 VR 19, 20 [1].

[182] See, eg, Champerslife [2010] NSWCA 33; (2010) 75 NSWLR 245.

[184] See the extracts at [49]-[52], [62]-[65] above. Opt out notices must be approved by the Court: the Act s 33Y.

[185] See [52], [62] above.

[186] Primus Telecommunications Pty Ltd v Kooee Communications Pty Ltd [2008] FCA 1027 [5]. See also Solak v Registrar of Titles [2011] VSCA 279; (2011) 33 VR 40, 55 [73] (Warren CJ); Angeleska v Victoria [2015] VSCA 140 [199], [201] (Warren CJ, Tate JA and Ginnane AJA).

[187] Kelly v Willmott Forests Ltd (in liq) (No 4) [2016] FCA 323 [236]-[239]. See also Clarke v Great Southern Finance Pty Ltd (in liq) [2014] VSC 514 [25], [46].

[188] [1996] 1 WLR 257.

[189] Barrow v Bankside Members Agency Ltd [1995] 2 Lloyd's Rep 472, 478.

[191] Barrow v Bankside Agency Ltd [1996] 1 WLR 257, 263.

[194] [2016] FCA 323 [214].

[196] See [143] above.

[197] See [143] above.

[198] [2010] NSWCA 33; (2010) 75 NSWLR 245.

[201] See [142] above.

[202] (1871) LR 6 QB 687.

[203] The primary judge did not, in terms, make findings of fact on this question: Reasons [115]-[116], [118], [128]-[129] (Mr and Mrs Collins). See also [84]-[85] above.

[206] See [183]-[187] above.

[207] The possibility of the Court giving group members the ability to make submissions in aid of the exercise of powers such as those conferred by s 33Q is not germane for present purposes.

[209] The same contention was dismissed by the primary judge: Reasons [723]-[725].

[211] Counsel referred to Tomlinson [2015] HCA 28; (2015) 89 ALJR 750, 757-8 [24]-[26].

[213] (1994) 181 CLR 251, 286. This statement has been approved subsequently. See Michael Wilson & Partners Ltd v Nicholls [2011] HCA 48; (2011) 244 CLR 427, 452 [89] (Gummow ACJ, Hayne, Crennan and Bell JJ); PNJ v The Queen [2009] HCA 6; (2009) 252 ALR 612, 613 [3] (French CJ, Gummow, Hayne, Crennan and Kiefel JJ); Batistatos v Roads and Traffic Authority (NSW) [2006] HCA 27; (2006) 226 CLR 256, 267 [15] (Gleeson CJ, Gummow, Hayne and Crennan JJ). In Oliver v Commonwealth Bank of Australia (No 2) [2012] FCA 755 [1]-[3], the Federal Court (Perram J) held that it was an abuse of process for plaintiffs who had not opted out of a group proceeding in which they were group members to maintain separate proceedings against the defendant in the group proceedings 'dealing with substantially the same subject matter' as that of the group proceedings. See also Clarke v Great Southern Finance Pty Ltd (in liq) [2014] VSC 569 [40].

[215] [2012] VSCA 42; (2012) 36 VR 130.

[216] Ibid 153-4 [97]. These factors were referred to again by this Court in Angeleska v Victoria [2015] VSCA 140 [154]-[159]. The High Court subsequently refused an application for special leave to appeal that decision: Angeleska v Victoria [2016] HCASL 5.

[217] [1996] 1 WLR 257.