Monday, 15th MayAbuse of Process

Abuse of Process

Tyne (Trustee) v UBS AG (No 2)  [2017] FCAFC 5

Mr Tyne (as trustee) and a company controlled by Mr Tyne had brought, and then discontinued, proceedings in the Supreme Court of NSW. The proceedings were discontinued after a decision of the High Court of Singapore in relation to the same subject matter. UBS argued that it was an abuse of process for Mr Tyne (as trustee) and his spouse Ms Marks to bring proceedings in the Federal Court arising out of the same factual matrix.

The issue on appeal was whether the appellants should be permitted to bring their actions in the Federal Court. This raised a question as to when abuse of process arises:

• In circumstances where the applicant was not a party to the earlier proceedings; and
• In circumstances where the earlier proceedings were decided on the basis of res judicata and not on their merits.

Held:

• Jagot and Farrell JJ: in relation to Ms Marks, while it can be an abuse of process for a non-party to earlier proceedings to bring subsequent proceedings, UBS failed to prove Ms Marks’ knowledge of and role in the Supreme Court proceedings so as to demonstrate her opportunity to make her claims in the earlier proceedings. 
• Dowsett J, in dissent: it was open to infer that the relationship between Mr Tyne and Ms Marks was such that Ms Marks should have brought her proceedings in conjunction with the earlier proceedings.
• Jagot and Farrell JJ: in relation to Mr Tyne (as trustee), the Supreme Court proceedings to which the trustee was a party were permanently stayed on the basis of res judicata rather than on the basis of findings of fact or law about the substance of the claims. The earlier proceedings were not decided on their merits and there was no basis to find an abuse of process. 
• Dowsett J, in dissent: the Federal Court of Australia Act requires the quick, inexpensive and efficient resolution of proceedings, the decision to discontinue the earlier proceedings was a forensic decision and to allow Mr Tyne (as trustee) to bring fresh proceedings would inflict manifest unfairness upon UBS.

NSWCA cases considered include:

• Champerslife Pty Ltd v Manojlovski [2010] NSWCA 33; (2010) 75 NSWLR 245
• Ghosh v NineMSN Pty Ltd [2015] NSWCA 334

High Court cases considered:

• Batistatos v Roads and Traffic Authority of New South Wales; Batistatos v Newcastle City Council [2006] HCA 27; 226 CLR 256
• Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28; (2015) 89 ALJR 750