Champerslife Pty Ltd v Manojlovski

In *Champerslife Pty Ltd v Manojlovski*, the Court of Appeal of New South Wales considered an appeal concerning the application of *Anshun* estoppel. The dispute arose from a prior proceeding where the respondent, Mr. Manojlovski, had sued Champerslife Pty Ltd and its director, Mr. Kordos, for breach of contract. In that earlier action, Champerslife had not filed a defence, and judgment was entered against it. Subsequently, Champerslife commenced new proceedings against Mr. Manojlovski, alleging breaches of contract and seeking damages. Mr. Manojlovski sought to have these new proceedings stayed, arguing that Champerslife was *Anshun* estopped from bringing its claim.

The primary legal issue before the Court of Appeal was whether Champerslife was estopped from bringing its second proceeding against Mr. Manojlovski, given that its current claims could have been raised as defences or counterclaims in the earlier litigation initiated by Mr. Manojlovski. This involved determining whether the substance of Champerslife's current claims was so similar to matters that ought to have been raised in the first proceeding that it would be unreasonable for Champerslife to bring the new action. A further question was whether *Anshun* estoppel could apply to Champerslife, a company, based on the conduct and potential claims of its director, Mr. Kordos, and whether Champerslife was claiming under or through Mr. Kordos.

The Court of Appeal reasoned that the test for *Anshun* estoppel is one of reasonableness, focusing on whether a matter *should* have been raised in earlier proceedings, not merely whether it *could* have been. The court found that the similarity of substance between the claims in the two proceedings was not, per se, unreasonable. Crucially, the court held that the director's control over the company did not automatically mean the company was *Anshun* estopped from bringing its own proceedings. The court also determined that Champerslife was not claiming under or through Mr. Kordos in a way that would make him *Anshun* estopped, and therefore Champerslife was not *Anshun* estopped.

Consequently, the Court of Appeal answered the separate question in the negative, finding that Champerslife was not estopped from bringing its proceedings. The court set aside the orders of the primary judge that had dismissed Champerslife's notice of motion and, in lieu thereof, dismissed the notice of motion. The respondents were ordered to pay the appellant's costs of the application heard by the primary judge and of the application for leave to appeal and the appeal itself.