An abuse of process of the court can occur in many circumstances, for example, where the:

One recognised class of abuse of process is where proceedings are instituted against a party in a second forum when there are proceedings against that party pending in another, and the continuance of the second would be an abuse of the process of the first. In those circumstances, the continuance of the second proceedings will be an abuse if those proceedings would be unjustifiably oppressive to the party named as defendant in both forums (see Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 358).

The appellant, Michael Wilson & Partners Limited (MWP), was incorporated in the British Virgin Islands. MWP practised as a law firm and a business consultancy in the Commonwealth of Independent States from offices in Kazakhstan.

The first and second respondents (Nicholls and Slater) were employees of MWP who terminated their employment with MWP. The third, fourth and fifth respondents (the companies) were companies associated with the first and second respondents and another former employee of MWP named Emmott.

MWP alleged that Nicholls, Slater and Emmott, separately and together, furthered his or their own interests at the expense of MWP. A central allegation was that the three men had conspired together to divert, and had in fact diverted, clients and business opportunities away from MWP to their own benefit, by having one or more of the companies act for the clients in question or by taking advantage of business opportunities that would otherwise have gone to MWP.

MWP sought relief in various jurisdictions and against various persons and entities. Of importance here was that MWP brought an arbitration in London against Emmott and proceedings in the New South Wales Supreme Court against Nicholls, Slater and the companies (and other defendants not party to the present matter).

The arbitration against Emmott took place pursuant to an arbitration clause in the agreement between MWP and Emmott. There was no such clause with respect to Nicholls and Slater, which is why arbitration was not pursued in their case.

This meant that the controversy between MWP and those whom it alleged had acted together to harm MWP was to be resolved partly in one venue (the London arbitration) and partly in another (the NSW proceedings).

In the London arbitration, MWP alleged that Emmott had acted in breach of contractual and fiduciary obligations that he owed to MWP. MWP sought an account of profits and damages for breach of contract and compensation for loss resulting from the breach of fiduciary duties as well as a general accounting between it and Emmott on the basis of wilful default by Emmott. The arbitrators granted relief in respect of some, but not all, of MWP's claims. An application was filed in the High Court to challenge this award.

In the NSW proceedings, MWP alleged that Nicholls and Slater had acted in breach of their contractual and fiduciary obligations and had knowingly assisted Emmott in his breaches of his fiduciary obligations. MWP claimed (amongst other relief) damages, compensation and an account of profits. MWP was awarded the relief it had claimed.

There was substantial, but not exact, overlap between the allegations made in both proceedings in that the claims against Nicholls and Slater in the NSW proceedings depended on Emmott being liable, which was the subject of the London arbitration.

The respondents argued that the institution of the NSW proceedings constituted an abuse of process. This argument was rejected at first instance but accepted on appeal. The Court of Appeal ordered a new trial for other reasons, but ordered deferral of the commencement of this new trial pending the appeal and final determination in the London arbitration on the basis that otherwise there would be an abuse of process. MWP appealed to the High Court.

The majority, Gummow ACJ, Hayne, Crennan and Bell JJ (and with whom Heydon J agreed on this issue), held that there had been no abuse of process.

They noted that different formulations of the alleged abuse had been adopted in the Court of Appeal and in the present appeal.

First, they considered the formulation adopted by Basten JA in the Court of Appeal, that there was an abuse because the NSW proceedings should be treated as a form of collateral attack upon the arbitrator's findings. They rejected this on the basis that the judgment entered in the NSW proceedings was entered before the arbitrator's award was published. In these circumstances, there could not have been any attack at the trial of the NSW proceedings upon any finding of the arbitrators.

The second formulation of the abuse of process argument proceeded from the starting point that any liability of the respondents to MWP for knowingly assisting Emmott in the breach of his fiduciary duties was limited by the nature and extent of the relief MWP sought and obtained in the arbitration of its claims against Emmott. The argument was that liability of the respondents was no more than "ancillary, or coordinate with", or "accessorial to" the liability of Emmott. The majority rejected this view of the relationship between the liabilities of a defaulting fiduciary and a knowing assistant of the fiduciary's breach. They held that the claims were not dependent upon the claims made against Emmott as asserted by the respondents.

Rather, the characterisation of liability of a knowing assistant as "accessorial" in this context means that the liability depends on proof of a breach of fiduciary duties by another. It does not mean that the relief awarded against the defaulting fiduciary and an assistant will necessarily coincide in either nature or quantum. Therefore, neither the nature nor extent of any liability of the respondents to MWP for knowingly assisting Emmott depends upon the nature or extent of the relief obtained in the arbitration against him.

Thirdly, they rejected the submission that there was an abuse because the NSW proceedings were directed to obtaining an advantage for which the proceedings were not designed or beyond what the law allows. The argument that the proceedings were an abuse of process assumed that the proceedings were in fact an abuse.

They also considered several other notable aspects of the respondents' arguments.

Firstly, underpinning some of the submissions about abuse was the proposition that a judgment in the NSW proceedings might lead to MWP being overcompensated. The majority rejected this argument because it ignored the equity that the respondents (and Emmott) would have to prevent enforcement to the extent that the claims for compensation for which judgment was obtained had been satisfied. Furthermore, the doctrine of contribution would regulate the ultimate allocation of the burden of satisfying the claims.

Related to this was an argument that, because the London arbitration award required a general accounting between MWP and Emmott, it was possible that MWP might owe Emmott more than Emmott's liability to compensate MWP. Setting these amounts off against each other would result in a net balance due to Emmott and MWP's claims for compensation would have been satisfied. The majority indicated that this possibility would not preclude MWP from pursuing the NSW proceedings. Rather, if this situation ever occurred the respondents would, as mentioned above, have an equity to prevent enforcement of the judgment against them in so far as enforcement would result in over-compensation.

Finally, the court noted that the respondent's formulations of abuse assumed that the claims made against the respondents for knowingly assisting Emmott in a breach or breaches of his fiduciary duties were the only relevant claims made in the NSW proceedings. This was not found to be the case.

Ultimately, they allowed the appeal.

This case is important in that is demonstrates quite clearly that pursuing related claims in different jurisdictions is not necessarily an abuse of process. Whether such conduct amounts to an abuse will ultimately depend on the circumstances. It is worth noting, furthermore, that the High Court envisaged that the pursuit of multiple proceedings could not end up over-compensating a claimant, as equity would intervene at the enforcement stage to prevent any double recovery.