Anshun Estoppel – The Risks Of Waiting, 25 Years On

You have bought defective goods from a supplier, which has caused damage to your property. You refuse to pay for those goods, so the supplier sues you. You defend the claim on the basis that the supplier has given you defective goods, but decide against pursuing your claim for damages – you want to see how this claim plays out before incurring the substantial costs of pursuing your own.

You reach a settlement with the supplier, which makes no reference to any claim for damages you might have, and then commence your own claim against the supplier. But is it too late? Have you lost the opportunity to pursue your claim?

The principles known as “Anshun estoppel” may be a quarter of a century old, having been laid down by the High Court in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45, but they retain critical importance. In essence, an Anshun estoppel can prevent a party from making claims which should have been pursued in earlier proceedings.

The test laid down is one of reasonableness: a party cannot raise a claim or issue in subsequent proceedings if that claim or issue is so connected with the subject matter of the first proceeding that it is unreasonable for them not to have raised it in the first proceedings (Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28, at [22]).

This is distinct from the principles known as res judicata and “issue estoppel”, which apply where a party attempts to re-litigate a matter that has already been decided. With Anshun estoppel, a party can lose the right to litigate a matter that has never before been raised. Further, even if res judicata, issue estoppel or Anshun estoppel do not arise, the courts have cautioned that an attempt to litigate an issue or matter resolved in litigation may amount to an abuse of process (Tomlinson, at [25]).

It remains as important as ever to consider, at an early stage, whether there are any potential claims you might wish to pursue. If they are not pursued at the appropriate time, you may run the risk of losing the right to pursue them altogether.

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The information published in this paper is of a general nature and should not be construed as legal advice. Whilst we aim to provide timely, relevant and accurate information, the law may change and circumstances may differ. You should not therefore act in reliance on it without first obtaining specific legal advice.