Lloyd Foyster v ANZ Banking Group - [2000] NSWSC 1038

CITATION: Lloyd Foyster v ANZ Banking Group [2000] NSWSC 1038

CURRENT JURISDICTION: Common Law Division

FILE NUMBER(S): SC 21004 of 1995

HEARING DATE(S): 30 July 1999

JUDGMENT DATE: 13 November 2000

PARTIES :

Lloyd Foyster (plaintiff)
Australia and New Zealand Banking Group Limited (defendant)

JUDGMENT OF: Hidden J at 1

COUNSEL : Rena Sofroniou (plaintiff)
A Street SC with J Stuckey Clarke (defendant)

SOLICITORS: Dunhill Madden Butler (plaintiff)
Blake Dawson Waldron (defendant)

CATCHWORDS: PRACTICE & PROCEDURE - Motion for summary dismissal of claims in fraud - effect of s86 Bankruptcy Act - whether Anshun estoppel applicable

LEGISLATION CITED: Bankruptcy Act 1966

CASES CITED: Gye v McIntyre (190-91) 171 CLR 609
Port Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589
Foyster v ANZ Banking Group Ltd [1999] FCA 1043

DECISION: See pars 12, 14, 15 & 17

THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
HIDDEN J
Monday 13 November 2000

21004 of 1995 Lloyd Foyster v Australia & New Zealand Banking Group
Reasons for judgment
1 HIS HONOUR: On 10 May 1999 I gave judgment in applications by the defendant that these proceedings be summarily dismissed or permanently stayed, and by the plaintiff for leave to file an amended statement of claim: Foyster v ANZ Banking Group [1999] NSWSC 300. That judgment did not resolve all the issues between the parties and the matter came back before me for further argument on 30 July 1999. Senior and junior counsel who represented the defendant on that occasion had not appeared at the earlier hearing.
2 The effect of my judgment was that, of the various claims made or proposed by the plaintiff, the only survivors were the claims in fraud arising from the transactions of 1985 and 1989 (pars 39-42 of the judgment) and the claim arising from the defendant’s sale of certain mortgaged property in 1994 (par 45). However, at the resumed hearing counsel for the defendant mounted further arguments in support of the summary disposal of those claims, developed in written submissions and orally. I allowed that course to be taken even though I had not invited further submissions on that matter in my earlier judgment.
3 It was argued that the pursuit of the claims in fraud would be futile because of the effect of s86(1) of the Bankruptcy Act 1966. That subsection provides:

86 Mutual credit and set-off

(1) Subject to this section, where there have been mutual credits, mutual debts or other mutual dealings between a person who has become a bankrupt and a person claiming to prove a debt in the bankruptcy:

(a) an account shall be taken of what is due from the one party to the other in respect of those mutual dealings;

(b) the sum due from the one party shall be set off against any sum due from the other party; and

(c) only the balance of the account may be claimed in the bankruptcy, or is payable to the trustee in the bankruptcy, as the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2000] NSWSC 1038
Decision Date: 13 November 2000

CaseChat Overview and Summary

Lloyd Foyster initiated proceedings against ANZ Banking Group, seeking damages for fraudulent conduct. The dispute centred on whether the bank had misrepresented the nature of financial products sold to Foyster. The matter was heard in the Federal Court of Australia. The central legal issue before the court was whether the bank could successfully argue for a summary dismissal of Foyster's claims, particularly in light of the provisions under section 86 of the Bankruptcy Act and the potential application of Anshun estoppel.

The court considered whether the bank had provided sufficient evidence to warrant a summary dismissal. It examined whether Foyster's claims were bound by prior inconsistent findings made in bankruptcy proceedings. The court also assessed the applicability of Anshun estoppel, which prevents a party from asserting a claim inconsistent with a finding made in a prior proceeding if the party had a full and fair opportunity to contest that finding. The bank argued that Foyster should be estopped from pursuing his claims due to inconsistent findings in his bankruptcy proceedings. However, the court found that the circumstances did not support the application of Anshun estoppel, as Foyster had not had a full and fair opportunity to contest the earlier findings.

Ultimately, the court determined that the bank had not provided sufficient grounds for a summary dismissal. The court held that the Anshun estoppel did not apply, and Foyster's claims could proceed. The motion for summary dismissal was therefore dismissed. The court's decision allowed Foyster's claims to continue, ensuring that the merits of the allegations against the bank would be fully explored in the substantive proceedings.

Orders