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Ammon v Consolidated Minerals Ltd [No 3]

Ammon v Consolidated Minerals Ltd [No 3]

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Case Copied 4 October 2007 79 min read

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JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: AMMON -v- CONSOLIDATED MINERALS LTD [No 3] [2007] WASC 232

CORAM: MARTIN CJ

HEARD: 6, 7, 12 - 16 & 19 - 23 FEBRUARY 2007

DELIVERED : 4 OCTOBER 2007

FILE NO/S: CIV 1222 of 2004

BETWEEN: DEREK NOEL AMMON
Plaintiff
AND
CONSOLIDATED MINERALS LTD (ACN 000 727 926)
First Defendant
PILBARA IRON ORE PTY LTD (ACN 100 410 295)
Second Defendant

Catchwords:

Breach of contract - Construction and interpretation of contract - Use of pre-contractual and post-contractual conduct in aid to construing terms of the contract - Implied terms - Breach of confidence - Whether information was confidential - Whether unconscientious use of information occurred - Breach of fiduciary duty - Misleading and deceptive conduct

Legislation:

Nil

Result:

Action dismissed

Category: B

Representation:

Counsel:

Plaintiff:     Mr J J Garnsey QC & Mr R J L McCormack
First Defendant             :     Mr G R Donaldson SC & Mr S K Dharmananda
Second Defendant         :     Mr G R Donaldson SC & Mr S K Dharmananda

Solicitors:

Plaintiff:     Taylor Linfoot & Holmes
First Defendant             :     Blakiston & Crabb
Second Defendant         :     Blakiston & Crabb

Case(s) referred to in judgment(s):

Attorney-General v Observer Ltd (1990) 1 AC 109
Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99
B.P. Refinery (Westernpoint) Pty Ltd v President, Councillors and Ratepayers of the Shire of Hastings (1977) 180 CLR 266
Burger King Corporation v Hungry Jack's Pty Ltd [2001] NSWCA 187
Butt v M'Donald (1896) 7 QLJ 68
Central Exchange Ltd v Anaconda Nickel Ltd [2002] WASCA 94; (2002) 26 WAR 33
Coco v AN Clark (Engineers) Ltd (1969) RPC 41
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337
C-Shirt Pty Ltd v Barnett Marketing & Managing Pty Ltd (1996) 37 IPR 315
FAI Traders Insurance Co Ltd v Savoy Plaza Ltd (1993) 2 VR 343
Fractionated Cane Technology Ltd v Ruiz-Avila [1988] 1 Qd R 51
Frame v Smith (1987) 42 DLR (4th) 81; [1987] 2 SCR 99
Hide & Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41
Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104; (1975) 5 ALR 527
Lac Minerals Ltd v International Corona Resources Ltd [1989] 2 SCR 574; (1989) 16 IPR 27
Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd & Others [2006] FCAFC 144
Mackay v Dick (1881) 6 App Cas 251
N P Generations Pty Ltd v Feneley [2001] SASC 185; (2001) 80 SASR 151
National Roads and Motorists' Association Ltd v Geeson [2001] NSWCA 343; (2001) 40 ACSR 1
O'Brien v Komesaroff (1982) 150 CLR 310
Peters (WA) v Petersville Ltd [2001] HCA 45; (2001) 205 CLR 126
Pethybridge v Stedikas Holding Pty Ltd [2007] NSWCA 154
Price v Powers [2005] WASC 154
Rapid Metal…

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: [2007] WASC 232
Decision Date: 4 OCTOBER 2007

CaseChat Overview and Summary

The case of Ammon v Consolidated Minerals Ltd [No 3] involved a dispute between Mr Ammon and Consolidated Minerals Ltd (ConsMin) regarding the interpretation of terms in a contract, specifically focusing on the obligations and rights of the parties concerning certain tenements. The court was tasked with determining whether there was a breach of contract, the interpretation of specific contract terms, and whether there was any breach of confidence, implied terms, or fiduciary duty. The High Court of Australia provided the final ruling in this matter.

The primary legal issues in this case revolved around the interpretation of specific terms within the contract between Mr Ammon and ConsMin. The court needed to ascertain the meaning and implications of terms 3 and 5 of the general conditions, particularly in relation to the rights and obligations of the parties concerning tenement E47/1140 and other tenements for which ConsMin had applied. Additionally, the court examined whether there was any breach of confidence, implied terms, or fiduciary duty by either party, including whether there was unconscientious use of information or misleading and deceptive conduct.

The court carefully considered the evidence and submissions from both parties. It found that term 3 did not imply that Mr Ammon had a present interest or entitlement to all tenements related to the project. Instead, it was interpreted as a condition under which ConsMin could return all leases and technical data if they chose not to proceed with the project. The court also highlighted that Mr Ammon's understanding and communications consistently indicated that he only had an interest in tenement E47/1140 and not in the other tenements. Furthermore, the court concluded that there was no breach of confidence, implied terms, or fiduciary duty by either party.

As a result of the court's reasoning, the action was dismissed. The court ruled that the terms of the contract were clear and that there was no breach of any contractual obligations by either party. Consequently, no further legal action was warranted in this matter.

Orders

Orders of the court

Action dismissed

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Term 3 of the general conditions gives rise to the same inference. It was as follows:3.The current 60 day agreement is: that I will not enter into any legally binding arrangements with regard to E47/1140 with any third party for the duration of the agreed period. Term 5 of the conditions said to apply to the second alternative offer; namely, the option to buy, was expressed in the following terms:5.At the end of the five years you must buy or walk ie if you don't exercise the option to buy, all leases held or applied for in relation to this project, plus all accumulated technical data must be returned to me free of charge without encumbrance. It was submitted on behalf of Mr Ammon that this term reflects an understanding on his part to the effect that he had a present interest or entitlement to all tenements held in relation to the project. I do not accept that submission. The term proposed was a term to the effect that, if ConsMin elected not to proceed with the project generally, Mr Ammon should receive the project in its entirety. Viewed in that way, the proposal tells one nothing about his understanding of the entitlements which he had at the time he advanced the proposal. Mr Greygoose provided a hardcopy of the email and attached terms to Mr Kiernan. Mr Kiernan's view of Mr Ammon's proposal is succinctly revealed in the words which he endorsed on it by hand at the time he passed it on to Mr Smith when he wrote:Colin, this bloke is away with the pixies! Mr Kiernan also directed an email be sent to Mr Ammon advising that he was reconsidering ConsMin's position in relation to Mr Ammon's various proposals. On 12 June 2002, Mr Ammon sent an email to Mr Faris dealing with native title issues. That email refers twice to EL47/1140, and makes no reference to the tenements for which ConsMin had applied, even though Mr Ammon was, by then, well aware of ConsMin's applications. Again, the terms of this email are entirely consistent with an understanding by Mr Ammon to the effect that his only interest was in EL47/1140 and that he had no interest or entitlement to the tenements for which ConsMin had applied. Nor was there any different understanding within ConsMin. On 13 June 2002, Mr Smith provided a memorandum to Mr Kiernan, responding to Mr Kiernan's implicit request for advice in relation to Mr Ammon's proposals. Mr Smith's memorandum commences with the observation:Ammon is not off with the pixies.He is one. The terms of the memorandum are only consistent with an understanding by Mr Smith to the effect that Mr Ammon had full ownership of EL47/1140, but ConsMin had full right, title and ownership to the tenements for which it had applied. For example, the memorandum contains the following paragraph:But importantly we should through or with Ammon, get the process moving, ie the cultural clearance(s). Even if we start with only the Ammon property. (NB: Ammon's greed has put paid to that approach and we must therefore concentrate on our own property. If that proves successful we become well placed in negotiations opposite Ammon.)