Anchung Pty Ltd v Northern Territory of Australia
[2017] NTSC 42
•9 June 2017
CITATION: Anchung Pty Ltd v Northern Territory of Australia [2017] NTSC 42
PARTIES:ANCHUNG PTY LTD
(ACN 088 484 977)
v
NORTHERN TERRITORY OF AUSTRALIA
JURISDICTION: SUPREME COURT OF THE NORTHERN TERRITORY EXERCISING TERRITORY JURISDICTION
FILE NO:31 of 2015 (21517154)
DELIVERED ON: 9 June 2017
DELIVERED AT: Darwin
HEARING DATES: 25-29 July 2016 and
2 August 2016
JUDGMENT OF: KELLY J
CATCHWORDS:
CONTRACT – Breach of contract for lease – Repudiation of agreement by lessor – Whether repudiation accepted before agreement affirmed
CONTRACT – Breach of contract for lease – Repudiation of agreement by lessee – Failure to fulfil condition precedent - Repudiation not accepted before the time for lessor’s performance of condition precedent expired - Intimation by lessee of refusal to perform – Intimation not retracted before the time for lessor’s performance of condition precedent due – Waiver of performance of condition precedent – Lessor entitled to sue for damages
CONTRACT – Breach of contract – Repudiation of agreement by lessee – Acceptance of repudiation by lessor – Whether lessor was ready, willing and able to perform agreement – Whether lessor had substantial capacity to perform – Whether lessor had definitively resolved not to perform
DAMAGES – Contract – Anticipatory breach – Assessment of damages
A New Tax System (Goods and Services Tax) Act 1999 (Cth)
Vitol SA v Norelf Ltd [1996] AC 800 - distinguished
Foran v Wight (1989) 168 CLR 385; Peter Turnbull & Co Pty Ltd v Mundus Trading Co (Australasia) Pty Ltd (1954) 90 CLR 235; Rawson v Hobbs (1961) 107 CLR 466 - applied
REPRESENTATION:
Counsel:
Plaintiff:I Robertson SC with P Jackson
Defendant:A Young QC with M Crawley
Solicitors:
Plaintiff:Ward Keller
Defendant:HWL Ebsworth Lawyers
Judgment category classification: B
Judgment ID Number: Kel1712
Number of pages: 60
IN THE SUPREME COURT
OF THE NORTHERN TERRITORYAnchung Pty Ltd v Northern Territory of Australia [2017] NTSC 42
No. 31 of 2015 (21517154)
BETWEEN:
ANCHUNG PTY LTD
(ACN 088 484 977)
Plaintiff
AND:
NORTHERN TERRITORY OF AUSTRALIA
Defendant
CORAM: KELLY J
REASONS FOR JUDGMENT
(Delivered 9 June 2017)
[1]This is an action for breach of a contract between the plaintiff and the defendant for the plaintiff to construct two houses in Milikapiti to be leased by the defendant for police housing.
Background and findings of fact
[2]Milikapiti is a small Aboriginal community of about 450 people on the north coast of Melville Island. It does not have a permanent police presence. It is serviced by regular visits by police stationed at Pirlangimpi. In 2012 the people of Milikapiti wanted a permanent police presence in the community. Sometime in 2012 the then Commissioner of Police visited the community and gave a commitment that if the Milikapiti community could provide the police with housing,[1] the police would provide a permanent police presence in the town.
[3]Mr Neville Roberts (the sole director of the plaintiff Anchung Pty Ltd) is a businessman with business connections on Melville Island. He heard that there was a need for police homes in Milikapiti. He made contact with the manager of the Milikapiti Social Club who was interested in developing houses for the Northern Territory Police (“NTP”) on land owned by the Social Club in order to facilitate the provision of a permanent police presence in the community.
[4]On 4 June 2013 Mr Roberts telephoned Ms Leanne Hulm who was the Assistant Director, Employee Relations of the Human Resource Management Branch of NTP. Mr Roberts told Ms Hulm that he had been contacted by representatives of the Milikapiti community about housing and getting a permanent police presence there and that he had been asked to contact NTP on their behalf to see how they could progress some leasing arrangements for police housing. Mr Roberts told Ms Hulm that he had entered into discussions with the community about appropriate land for police housing and about the sort of houses that his company could provide.
[5]Mr Roberts is the sole director and shareholder of Renhe (Australia) Investments Group Pty Ltd (“Renhe”). Renhe has a relationship with a Chinese company Zhangzhou Renhe Moveable Travelling Lodge Manufacture Company Limited (“Zhangzhou Renhe”). Zhangzhou Renhe manufactures prefabricated housing units which fold up into what is effectively a shipping container for transport.
[6]The prefabricated units come pre-equipped with internal plumbing and electrical wiring including air conditioning. The manufacturer’s brochure states that the houses can be erected and installed within seven days. The time frame given in the brochure from start to finish is 90 days. It states inter alia:
·Planning and documentation 30 days from appointment.
·Product fabrication for two 120 m² homes 60 days.
·Civil works including footings and all ground preparations can happen ahead of unit delivery.
·Two home installations are 30 days after site delivery.
·Completion time from start to occupancy is three months and is subject to power and water connections.
[7]This is the product Mr Roberts described to Ms Hulm. One of the proposals put to Ms Hulm by Mr Roberts was for the police to purchase the houses from Renhe. Ms Hulm explained to Mr Roberts that NTP does not buy houses, it only rents them.
[8]Another proposal was for the Milikapiti Social Club to purchase the prefabricated houses from Renhe, install them on land owned by the Club and lease them to NTP. That proposal did not go ahead, Milikapiti Social Club being either unable or unwilling to proceed with purchase of the houses.
[9]The final option, the one that was proceeded with, was for one of Mr Roberts’ companies to lease land in Milikapiti from the Office of Township Leasing (“OTL”), erect the houses on that land and lease them to the defendant for police housing.
[10]On 27 June 2013 Mr Roberts and Ms Hulm visited one of the prefabricated modules that had been erected as a display home at Knuckey Lagoon. As a result of this visit, Ms Hulm satisfied herself that the houses met the requirements of the Police Union.
[11]On 31 October 2013 OTL sent Mr Roberts a serviced land availability program (SLAP) map of Milikapiti and indicated that lots 406(A) and 407(A) might be suitable for the police housing. The map purports to show land to which services are available and which is therefore available for subleasing. Unfortunately, although these blocks were serviced by water and electricity, the nearest sewer connection was about 160 metres away on the other side of an unlined stormwater drain. This was not shown on the SLAP map.
[12]Renhe subsequently entered into 20 year sub-leases of lots 406(A) and 407(A) from the Executive Director of OTL commencing on 1 January 2014.
[13]Ms Hulm and Mr Roberts discussed the proposal and additional requirements NTP had for rental properties. On 29 January 2014 Ms Hulm advised Mr Roberts that his proposal had been approved subject to the changes listed in her email (including provision of a carport, garden shed and perimeter fencing). On the time frames set out in the Renhe product information Mr Roberts had provided to Ms Hulm, if an agreement had been reached at that time the expectation was that the houses would be installed ready for occupation by mid-May 2014.
[14]In early February 2014, Mr Roberts prepared and executed residential tenancy agreements (“RTAs”) between the plaintiff and the defendant and posted four copies to Ms Hulm. The under-lessor named in the RTAs was Anchung Pty Ltd, not Renhe, the sub-lessee under the sub-leases from OTL. Mr Roberts (and Mr John Irving, the plaintiff’s financial advisor) gave evidence that the plaintiff was chosen as the vehicle for this development because it had available tax losses which could be offset against rental income.
[15]Mr Roberts obtained consent from OTL to transfer the sub-leases from Renhe to the plaintiff. Transfers of the sub-leases were prepared but as events turned out, were not put into effect.
[16]Ms Hulm received the RTAs on 11 February 2014. She signed them on behalf of the defendant and returned them to Mr Roberts on 19 March 2014.[2] Ms Hulm initialled every page but inadvertently omitted to sign the execution page. Mr Roberts returned them for completion and Ms Hulm duly signed the execution page and returned the RTAs on 5 August 2014. (The RTAs together with the specifications for the houses and other improvements to be erected on the land set out in the email from Ms Hulm of 29 January 2014 are collectively referred to as “the Agreement”.)
[17]Each of the RTAs is expressed to be “FOR THE TERM OF 20 YEARS COMMENCING ON THE HANDOVER OF PROPERTY …/…./2014 EXPIRING ON 20 YEARS + HANDOVER …/…/2034”. By the time of the trial,[3] it was common ground between counsel for the parties that the effect of this was that the commencement of the RTAs was subject to a condition precedent, namely handover of the properties with houses erected to the agreed standard, by the end of 2014. The rent specified was $3,279 per month.
[18]Also on 19 March, Ms Hulm sent Mr Roberts a “vendor creation form” to complete to enable NTP to pay the security deposit. The form was subsequently completed and sent back, and the defendant paid the plaintiff a security deposit of $3,276 for each residential tenancy agreement (total $6,552).
[19]In anticipation of the signing of the RTAs, Mr Roberts had ordered the houses from Zhangzhou Renhe, and advised Ms Hulm of this on 14 March 2014. (He had already ordered one house and paid an USD$18,000 deposit on 7 January 2014 for a unit he had originally intended to use as an upgraded display home. He ordered the second one on 14 March 2014 and paid a deposit of USD$32,868 on 14 May 2014.)
[20]On 19 March 2014, Ashburner Francis Pty Ltd submitted draft site servicing plans to Power and Water Corporation on behalf of the plaintiff. The plans included a line showing the extension needed to connect the blocks to the sewer line. On 20 March 2014 Power and Water Corporation responded seeking further information regarding the proposed sewer main extension which needed to be provided before in principle approval for the connection of services could be provided. Ashburner Francis Pty Ltd did not do any further work on the project because their invoice had not been paid.
[21]On 23 April 2014, Ms Hulm telephoned Mr Roberts to seek an update on the houses. Mr Roberts told her that the houses would be up in around 90 days (that is to say, by about 22 July 2014).
[22]Mr Chris Clarke, the project manager engaged by the plaintiff, requested a quote from Top End Development Civil Pty Ltd for the installation of the houses on the blocks at Milikapiti and this was provided on 17 July 2014. However, this quote was not accepted.
[23]Ms Hulm sought a further update from Mr Roberts on 11 June 2014. Mr Roberts advised her that manufacture had been delayed by three weeks and handover was estimated by mid to late August 2014.
[24]The houses were complete on 25 July 2014, shipped out on 31 July 2014, and arrived in Darwin on 29 August 2014. The plaintiff picked them up from the wharf and stored them at Darwin Container Services yard at Berrimah.
[25]In the meantime the plaintiff (or Renhe on its behalf) was sourcing various items needed for the construction of the two houses on the blocks in Milikapiti (for example kitchens, wall fans, decking screws, locks and footings).
[26]The plaintiff engaged Paul Campbell & Associates and that firm prepared architectural site plans and specifications.
Financial difficulties with the project and attempts by the plaintiff to renegotiate the terms of the Agreement
[27]On 21 July 2014, Mr Roberts advised Ms Hulm by telephone that he had funded the houses personally to date; that the absence of finance was causing hardship; and that he was seeking assistance in improving the security that he could offer potential lenders.
[28]In the meantime, (and unbeknown to Mr Roberts) the defendant had arranged for the construction of a new police station in Milikapiti. This was completed and handed over in early June 2014. Superintendent Scott Pollock deposed to internal police communications in relation to the construction of the police station and the manning of it being contingent on the provision of the two police houses but none of this was communicated to Mr Roberts. He also deposed to concerns he held from August 2014 onwards and communicated to others within NTP in relation to Mr Roberts’ ability to complete the houses in a timely fashion, but again, none of this was communicated to Mr Roberts.
[29]Superintendent Pollock deposed that at some unspecified time in or after August 2014 he looked at the plans for the houses and formed the view that the rooms were too small. He deposed that he spoke to Kym Butler of the Police Facilities Management Division who he said also “had concerns”. He did not check with Ms Hulm who had ascertained from the Police Union that the houses were considered suitable by them. Nor did he communicate any concerns to Mr Roberts.
[30]The financial viability of the project from the plaintiff’s point of view depended upon the plaintiff obtaining commercial third party finance. Mr Roberts believed this would be feasible given that the plaintiff had a 20 year government lease in place to offer as security. However, he reckoned without the banks’ attitude toward lending on the security of any interest in Aboriginal land. Between March and May 2014, Mr Roberts applied to Westpac, NAB and Commonwealth Banks but could not obtain commercial finance on acceptable terms.
[31]Mr Roberts was growing increasingly desperate and sought help from the office of the Chief Minister and Senators Scullion and Xenophon without success.
[32]On 11 August 2014, Mr Roberts sent the following email to Ms Hulm (“Plaintiff’s the August email”):
… You may or may not be aware that my company has been seeking funding for the Police homes planned for Milikapiti, but to date all attempts have failed, remarkably even with the OTL leases and the NTG rental agreements.
As per my last email, the homes have been built and are on the water and almost in Australia, they were planned to be installed within a few weeks.
I have funded this personally to date. Regrettable (sic) I cannot proceed any further without commercial funding. I have attached a letter out-ling (sic) the details and am available to discuss this at any time, I do hope we can find a solution, but every institution major and other have refused to fund this project on indigenous lands. [emphasis added]
[33]In the attached letter (“the Plaintiff’s August letter”), Mr Roberts went into greater detail about the difficulties he was experiencing in getting any financial institution to agree to finance a project on indigenous land. The letter begins:
Further to the Police houses and your lease with my company Anchung Pty Ltd I would like to confirm with you that due to funding issues the immediate installation of the homes has to be postponed.
It ends:
This is obviously now at a critical point and if there is no interest from your department to salvage this development, I will have no alternative but to try and sell these homes else-where.” [emphasis added]
[34]Ms Hulm passed the Plaintiff’s August email and August letter on to Superintendent Pollock, who passed them on up the chain of command to then Assistant Commissioner Reece Kershaw.
[35]On 13 August 2014, Mr Roberts sent to Indigenous Business Australia (IBA), among others, an email which stated, “I have given the Police notice that we are unable to proceed as no funding is available”. In cross-examination, Mr Roberts agreed that what he told IBA by email on 13 August 2014 reflected what he had told the defendant, namely, “that without commercial funding we couldn’t proceed”.
[36]On 8 September 2014, Mr Roberts sent the defendant a copy of a further email (“the Plaintiff’s September email”) in which he wrote, among other things:
I wanted to make it very clear that I am unable to fund a Northern Territory Government Police Homes deal on Federal Government leased land, in Milikapiti Tiwi Islands ... [emphasis added]
[37]Mr Roberts agreed in cross-examination that the plaintiff had not resolved its funding problems by the end of September 2014.[4]
[38]On 15 October 2014, Mr Roberts advised Ms Hulm by telephone that he could deliver the properties if the defendant increased the rent by $11,376.00 per annum so that he could secure an investor. Ms Hulm said she would have to refer the matter to Superintendent Pollock. She did so and received a return email from Superintendent Pollock saying (inter alia), “My understanding is that the houses are unsuitable in any case,” and referring to his discussion with Kym Butler. Ms Hulm deposed that this was the first she had heard about any unsuitability of the houses or any involvement of Kym Butler who worked in the facilities management division, managing police owned facilities, not rented homes.
[39]On 21 October 2014, Mr Roberts sent to the defendant a series of emails (“the Plaintiff’s 21 October emails”) which, in substance, proposed variations to the RTAs by extending the term of each RTA from 20 to 25 years[5] and increasing the rent payable by the defendant.[6]
[40]In one of the Plaintiff’s 21 October emails[7] Mr Roberts wrote:
We need some assistance from the NTG to make this work. ... If we can achieve the increase to rent and length of lease, the loan will get processed very quickly and the homes installed before Christmas. [emphasis added]
[41]In a later one of the Plaintiff’s 21 October emails, Mr Roberts repeated the need for increased rent and an extension of the term to 25 years and said:
I understand the economics but I have been working for 18 months in every quarter of Federal and Territory government to get this deal to work and it will only happen with this commitment from the NTG. [emphasis added]
[42]On 21 October 2014, Superintendent Scott Pollock took over the responsibility of dealing with the plaintiff and the project from Ms Hulm. Thereafter,[8] the only response Mr Roberts received to the proposals/ requests in the Plaintiff’s 21 October emails was an email from Ms Hulm saying:
Thanks Neville,
The new contact person for this matter is Scott Pollock. Can you please ensure all future correspondence is addressed to Scott as this matter no longer falls within my portfolio. [Contact details were provided.]
I have passed on this and all previous correspondence to Scott in relation to the revised proposal.
Thanks,
Leanne
[43]Neither Superintendent Pollock nor anyone else ever responded to Mr Roberts’ requests in the Plaintiff’s 21 October emails either to accept or reject them. No-one other than Ms Hulm ever even acknowledged them. The first response Mr Roberts received to the Plaintiff’s August email, the Plaintiff’s August letter, the Plaintiff’s September email and the Plaintiff’s 21 October emails was a letter from then Acting Commissioner Kershaw on 7 November 2014 purporting to terminate the Agreement (referred to below).
[44]Mr Roberts deposed that on 27 October 2014 he spoke to Superintendent Pollock. There does not seem to have been much of substance spoken about. Mr Roberts’ recollection was that Superintendent Pollock told him that the Commissioner was angry about the proposal to increase the rent and term of the residential tenancy agreements. Superintendent Pollock deposed that he had no recollection of any such conversation and that Mr Roberts’ account was inconsistent with his understanding of the situation, as he did not understand the Commissioner to have been angry about Mr Roberts’ proposals. I accept Mr Roberts’ evidence that such a telephone conversation did take place. It may be that Mr Roberts misunderstood the conversation. It is not necessary for me to determine this as it is not relevant to anything I have to decide – except that what was said in that conversation (or what Mr Roberts understood by it) may have contributed to his concern, following the further phone call on 6 November (referred to below), that NTP might try to get out of the project which led Mr Roberts to affirm the Agreement on 7 November.
Progress on construction of the houses
[45]In the meantime, the plaintiff continued to work towards installing the houses. On 27 October Travis Drenth of Travis Drenth Constructions Pty Ltd (“TDC”) provided a final quote for the installation of the houses for $271,260.00.[9] This included connection of services. The quote was verbally accepted by Mr Roberts on behalf of the plaintiff, but as events turned out, Mr Drenth was never given the go ahead to start work.
Termination of the agreement by the defendant
[46]On 5 November 2014, then Acting Commissioner Kershaw,[10] Superintendent Pollock, and three others (Michael Bissell, Alan Wagner and Andrew Pusteria) flew to Milikapiti to inspect the police station and the lots for the proposed police houses. Mr Roberts was not invited or told of the proposed inspection of the lots. Nor was Ms Hulm. Sergeant Higgins (a police officer stationed at Pirlangimpi) drove Acting Commissioner Kershaw and Michael Bissell to view the proposed lots for the police houses. However he showed them the wrong lots [216 and 217 rather than 406(A) and 407(A)].
[47]Commissioner Kershaw deposed:
It was either at the 29 October meeting [with “NT Police employees including Alan Wagner … Director of the Infrastructure and Procurement Branch”] or in the lead up to it that we arranged a trip to Milikapiti for myself and a few others. I instigated this trip in conjunction with Scott Pollock (who was in charge of Darwin Metropolitan Command, which geographically incorporated the Tiwi Islands). By that stage, I had formed the view that we would likely need to terminate the arrangements with Neville Roberts and his companies. However, as a matter of course I would always thoroughly investigate and consider all of the information available before making any significant decisions. It was on that basis that I considered it appropriate to travel to Milikapiti. The purpose of the trip was to see the new police station, to view the land on which Neville Roberts had proposed to construct the houses, and to consider possible alternative housing (being some vacant Department of Health housing).[11]
[48]Commissioner Kershaw did not explain why he had “formed the view that [they] would likely need to terminate the arrangements with Neville Roberts and his companies”. He did not speak to Mr Roberts or to Ms Hulm (who had had the conduct of the matter until 21 October).
[49]He deposed further that by about 3 November 2014, he had come to the conclusion that he would need to end the arrangement with Mr Roberts and his companies. He did not explain what had happened between 29 October and 3 November to cause him to crystallise his views on the matter. He said he “indicated to NT Police employees” (though he cannot remember who) that he was “inclined to terminate the arrangement”.[12] He did not tell Mr Roberts.
[50]Commissioner Kershaw’s thorough investigations seem to have consisted of flying to Milikapiti with four other people – none of whom had been involved in the project – and inspecting the wrong blocks of land. He deposed:
Regardless of this [ie inspecting the wrong blocks of land], as a result of our inspection I confirmed my understanding that no construction activity had commenced. It was clear to me that no housing would be available in the foreseeable future. [13]
[51]Leaving aside the question of how he could confirm his understanding by looking at the wrong land, Commissioner Kershaw’s understanding that no construction work had commenced and that no housing would be available in the foreseeable future appears to have been based on an assumption that the houses were to be constructed using standard construction techniques in which one would expect to see a slab poured and other signs of preliminary work.[14] In fact by the time of Commissioner Kershaw’s visit to Milikapiti the houses had been constructed (complete with internal services – wiring, plumbing, air conditioning etc) and shipped from China to Darwin. They were sitting in a warehouse in Darwin ready to be taken to Milikapiti.
[52]Commissioner Kershaw did not speak to Ms Hulm who had this information or look at her file in which these matters were recorded and which contained the plaintiff’s brochure which represented that the houses could be erected within seven days.[15] Nor did he speak to Mr Roberts who could also have told him these things, or question Mr Roberts about the progress that was being made or the steps that had been taken to date.[16] In cross-examination he said he did not think this would be appropriate for reasons he did not explain.
[53]Commissioner Kershaw deposed that he could not remember exactly when he made the final decision to terminate “the arrangement” with Mr Roberts’ company, but believed it “was shortly after arriving back from Milikapiti (probably on 5 November 2015)”. He said that “that decision was communicated internally to NT government employees”, but no-one told Mr Roberts.
[54]Throughout his affidavit, Commissioner Kershaw refers to “the arrangement” with Mr Roberts’ company rather than to an agreement. It does not appear as though his thorough preparation extended to examining the RTAs to check the relative obligations of the parties and the time frame within which these were to have been achieved.[17]
[55]Meanwhile, on 6 November 2014, Mr Roberts and Mr Irving (the plaintiff’s financial advisor) telephoned Superintendent Pollock, chiefly it seems to ask about Mr Roberts’ requests in the Plaintiff’s 21 October emails. Mr Roberts deposed that during that telephone conversation he explained to Superintendent Pollock the nature of the delays and funding difficulties which they had experienced but assured him that the police homes would be installed before Christmas 2014. He said, “Pollock said words to the effect that we would be receiving a letter soon but was otherwise non-committal.”[18]
[56]Mr Irving was cross-examined about that telephone conversation. He agreed that Mr Roberts sought to reassure Superintendent Pollock he still wanted to supply the two police houses for Milikapati and that Superintendent Pollock told them they would be getting a letter from the Commissioner of Police.
[57]Superintendent Pollock’s evidence in relation to this telephone conversation is not materially different. He deposed that he was surprised to receive the phone call, that he had never had any prior discussions with Mr Roberts and that:
I remained non-committal throughout this telephone discussion and made it clear to John Irving that the issues he wished to discuss were not my decision to make and that he would be receiving a formal response shortly.
[58]Superintendent Pollock referred specifically in his affidavit to Mr Roberts’ affidavit evidence about this telephone discussion and the only thing he disagreed with is this:
[T]he discussion was instigated by a man who introduced himself as John Irving who indicated to me at the outset that Neville Roberts was in the room with him. I was not aware of Neville Roberts speaking to me during the course of that discussion although it is possible he may have spoken to John Irving. For that reason I deny the statements that Neville Roberts had a telephone discussion with me on that date.
[59]At 10:14am on 7 November 2014, Mr Roberts sent an email to Superintendent Pollock (“the Plaintiff’s First 7 November email”) stating (inter alia):
Following our phone conversation between us and John Irving of my office Thursday 6/11/14, I am writing to confirm my advice during that conversation. That following delays for funding the installation of the two, specially constructed homes, for your Police members at Milikapiti on Tiwi Islands will be installed and available for occupation prior to Christmas 2014. (sic)
…
The agreement between us signed NT Police, Fire and Emergency Services has specific terms and conditions which I can confirm are unchanged and as such request your confirmation that you will accept occupancy under the agreement, time is of the essence here. (sic)
[60]Mr Roberts deposed that he sent this email because following the discussion with Superintendent Pollock on 6 November he was “concerned that the NTP might try to get out of the project”. The email was a clear and unambiguous affirmation of the existing Agreement.
[61]On receipt of the Plaintiff’s First 7 November email, at 1:24pm on 7 November 2014 Superintendent Pollock sent an email to Mr Roberts saying:
I thought I made it clear to both yourself and John yesterday that you would receive written formal advice in the near future regarding this matter. Can I ask that you await receipt of that advice before entering into any further correspondence.
[62]Mr Roberts replied at 1.42 pm on 7 November (“the Plaintiff’s Second 7 November email”) as follows:
I have advised you that time is of the essence and we require your immediate confirmation. My company has a current and binding contract with the NT Police Fire and Emergency Services and plan to perform as required.
[63]At 4.11pm on 7 November Superintendent Pollock sent an email to Mr Roberts saying:
Hi Neville, letter of notification attached as requested. Original to follow in the mail.
The attached letter (“the Defendant’s 7 November letter”), signed by (then) Acting Commissioner Kershaw, read:
Dear Mr Roberts,
I refer to your letter of 11 August 2014 for the attention of Ms Leanne Hulm in which you advised that the installation of homes at Milikapiti would be postponed.
The purpose of this letter is to advise you that the Northern Territory Police, Fire and Emergency Services (NTPFES) will not be proceeding with any arrangements with Renhe Australia in relation to leasing Lot 406(a) or Lot 407(a) Milikapiti (“the Properties”) for the purposes of providing housing to NTPFES staff. This is due to the extensive delay in progressing this arrangement and the immediate need to provide accommodation for our staff.
The Residential Tenancy Agreement has not yet come into force due to the term being detailed as commencing on “the handover of the property” therefore there are no legal obligations or any legal barriers to NTPFES removing itself from the proposed agreement.
We note that a deposit totalling $6,552.00 was paid into your account on 26 March 2014 and we request return of this deposit within 10 business days …
[64]The letter states that NTP will not be proceeding with the arrangements because of “extensive delay in progressing this arrangement and the immediate need to provide accommodation for our staff”. In cross-examination Commissioner Kershaw agreed that no-one from NTP had ever complained to Mr Roberts about any delays or given him notice that the houses were required by a particular date.
[65]At the trial I asked Commissioner Kershaw how terminating the Agreement was going to fulfil the immediate need for accommodation for staff or advance that end. Commissioner Kershaw’s reply was, “Because we were able to look for other alternative options,” something that he had deposed in his affidavit he was already doing before terminating the Agreement.[19] In any event, the upshot of the Commissioner’s decision has been that although the new police station was complete in mid-2014, as at the date of the trial there was still no housing available for police in Milikapiti; Milikapiti still did not have a permanent police presence; and the plaintiff had two purpose built houses sitting in storage that it had been unable to find a buyer for.
[66]After receiving the Defendant’s 7 November letter, Mr Roberts sent further correspondence seeking confirmation that NTP would comply with the Agreement. On 10 November 2014 Acting Assistant Commissioner Anne-Marie Murphy sent Mr Roberts an email saying that NTP stood by the Defendant’s 7 November letter and advising that the defendant did not consider the Agreement to be binding as there had been no handover of properties, a position the defendant has now (quite properly) abandoned.
[67]On 12 November 2014, the plaintiff’s solicitors wrote to Acting Commissioner Kershaw in the following terms:
We are instructed that our client has advised you on a number of occasions that it is ready, willing and able to proceed with the agreement for the provision of two police houses in Milikapiti to be leased by the Northern Territory Government Police, Fire and Emergency Services (NTG). To clarify, we confirm that our client is able to proceed on the basis that the terms as to rent payable and duration of the leases will be the same as those under the residential tenancy agreements dated 3 February 2014.
Notwithstanding your letter of 7 November, and your recent confirmation via email to our client that you do not propose to proceed with the agreement with our client, we are instructed to provide a final opportunity for the NTG to move forward with the agreement for the provision of the police houses in Milikapiti by our client.
We ask that you provide your response to this within 48 hours of receipt of this letter.
We note that as a result of the recent delay of approximately a week and a half whilst discussions have been ongoing between the NTG and our client, Anchung is now at significant risk of being unable to complete the project by the end of 2014, in the event there is substantial inclement weather between now and the end of December. In the event that the NTG agrees to proceed with project, we trust that the parties can engage in productive discussions regarding the extra time that may be required to finalise the project.
[68]Acting Commissioner Kershaw responded confirming the defendant’s position; again denying that there was a binding agreement; referring to the Defendant’s August letter; and saying that the significant risk to the installation of the homes was caused not by the “recent delays” but by “the delay on behalf of your client spanning several months”.
[69]Things continued in this vein for a time. On 24 November 2014, the plaintiff’s solicitors wrote two letters to Acting Commissioner Kershaw. The first refused to return the security deposit, advised that the plaintiff would be taking steps “to recover the totality of its loss arising from the failure of the NTP to comply with its obligations” and set out their analysis of the legal position (which the defendant now essentially accepts) in the following terms:
With respect, your position that there is no binding agreement in place between our client and the NTP is legally flawed.
In this regard we refer you to a line of cases, most recently approved in the Northern Territory Supreme Court in the matter of Mattila and Gardner [2012] NTSC76 (sic) in which the Courts have confirmed that the essential terms required for the parties to bind themselves to a lease or an agreement are: identification of an agreement to the parties; the premises; the term; and the rent. In this regard we note as follows:
Parties:Anchung Pty Ltd and Northern Territory Government Police Fire and Emergency Services
Premises: Lot 407a and 406a Plan 52012/187
Rent: $757 per annum (sic)
Term:20 years from the date of handover being no later than 31 December 2014
[70]The second letter referred to the first and said:
Notwithstanding that our client is committed to exercising all its legal rights to recover any and all losses it has and will suffer as a result of the repudiation by the NTP, our client remains willing to work together to achieve an amicable outcome.
Should the NTP wish to proceed with discussions to find a solution to this matter, our client’s director will be available at short notice at a time convenient to the parties to hold discussions.
[71]The defendant did not take up this offer from the plaintiff. On 4 December 2014, Acting Assistant Commissioner Murphy wrote to the plaintiff’s solicitors acknowledging the letters of 24 November and advising:
Please note that the issues you have raised will be responded to once we have had an opportunity to consider these matters further.
[72]No such further response was ever forthcoming, and on 13 March 2015 the plaintiff’s solicitors wrote to Acting Assistant Commissioner Murphy summarising the prior dealings between the parties and advising (inter alia):
Our client considers that the conduct of the NTP plainly amounts to a repudiation of the Agreements, which is now expressly accepted by our client.
The proceeding
[73]In due course the present proceedings were issued claiming damages for breach of the Agreement.
[74]In its further amended statement of claim the plaintiff sought damages for breach of the Agreement. It relied on the Defendant’s 7 November letter as a repudiation of the Agreement (as well as on the letter to the plaintiff’s solicitors dated 14 November 2014) and the letter from the plaintiff’s solicitors of 13 March 2015[20] as accepting that repudiation.
[75]In the further amended defence, the defendant denied the existence of any agreement based in part on a failure of the parties to agree on a bathroom specification.[21] The defendant also pleaded that Mr Roberts had “orally advised Ms Hulm that the houses would be ready for occupation by ‘mid-May 2014’ meaning thereby 16 May 2014 (Commencement Date)”; that the defendant had executed copies of the RTAs “in reliance upon the Commencement Date”;[22] and that therefore if there was an agreement (which it denied) handover of the houses was due by 16 May 2014. Somewhat bizarrely, the defendant pleaded that the First 7 November letter which affirmed the Agreement (and said time was of the essence), amounted to a termination of the Agreement for non-fulfilment of the (implied) term to hand over the houses by 16 May 2014. Alternatively, the defendant relied on the Plaintiff’s August email, the Plaintiff’s August letter and the Plaintiff’s 21 October emails as amounting to a repudiation of any agreement by the plaintiff.
[76]Most of the contentions in the defence were abandoned at the trial. At the trial, the parties were ad idem that there was an agreement in existence constituted by the two RTAs and the agreement to construct houses on the relevant blocks to the agreed standard (ie the Agreement as defined above), and that the commencement of the RTAs was subject to a condition precedent that the completed houses had to be handed over by the end of 2014.
[77]The plaintiff claimed that the defendant had repudiated the Agreement by the Defendant’s 7 November letter and had not resiled from its position before the plaintiff accepted that repudiation on 13 March 2015, and that it was entitled to damages for breach of the Agreement.
[78]The defendant’s final position (as articulated in opening by counsel for the defendant) was fourfold.
(a)The defendant contended that, by its conduct in the August, September and October 2014, which continued into November 2014, the plaintiff had renounced and repudiated the Agreement. In November 2014, the defendant elected to accept the plaintiff’s repudiation of the agreements and chose, as it was entitled to do, to treat the Agreement as being unenforceable by the plaintiff. The plaintiff was informed of the defendant’s election.
(b)Alternatively, if the defendant repudiated the Agreement by the Defendant’s 7 November letter (as contended by the plaintiff), the plaintiff did not accept any such repudiation before the time for the plaintiff’s performance expired. The two RTAs remained on foot until 31 December 2014 and then became unenforceable by the plaintiff because the plaintiff failed to hand over to the defendant either of the two houses to which the RTAs refer.
(c)In the further alternative, if the defendant repudiated the Agreement as the plaintiff contends, at the relevant time the plaintiff was not ready, willing and able to perform its obligations, (that is to fulfil the condition precedent of constructing and handing over the houses on the two blocks of land) as it was simply not possible to do so. Accordingly, the plaintiff can have no right or entitlement to any damages at all.
(d)The fourth proposition was that the plaintiff had grossly overstated its damages.
[79]On the question of liability, the issues at the trial therefore were:
(i)whether the plaintiff had repudiated the Agreement in the Plaintiff’s August email, the Plaintiff’s August letter, the Plaintiff’s September email and/or the Plaintiff’s 21 October emails and (if so), whether the defendant had accepted that repudiation and validly terminated the Agreement before the plaintiff unequivocally affirmed the Agreement in the Plaintiff’s First 7 November email;
(ii)if not (and if the defendant repudiated the Agreement by the Defendant’s 7 November letter) whether it was necessary for the plaintiff to accept any such repudiation before the time for the plaintiff’s performance expired on 31 December 2014 in order to have a right to claim damages;
(iii)if not, whether, as at 7 November 2014, the plaintiff was ready, willing and able to perform its part of the agreement.
Fact finding and credit issues
[80]Before discussing these issues, I need to make some general remarks about the process of fact finding and issues of credit.
[81]There is no real dispute in this case about the substance what occurred. Mr Roberts and Ms Hulm gave evidence about the initial negotiations, the entry into the Agreement and later communications. I found them both to be honest and reliable witnesses, relating the same events from their different perspectives. Their evidence did not differ in any substantial or material way and to the extent that it differed in detail, I accept that that is the result of understandably differing recollections. It is not necessary for me to decide whose recollections are likely to be more accurate on those matters of detail as none of them are relevant to the issues in this proceeding.[23]
[82]Similarly, there is no real difference in the accounts of Mr Roberts, Mr Irving and Superintendent Pollock. (This is discussed in more detail elsewhere.)
[83]Evidence about the technical details of how the houses were to be constructed, the costs involved and the time it would have taken to complete were given by Mr Roberts, Mr Drenth of TDC, and to a lesser extent Mr Clarke and Mr Irving. I accept that they were all honest and reliable witnesses and their evidence is generally supportive of each other.
Issue (i): Did the plaintiff repudiate the Agreement and did the defendant accept that repudiation and validly terminate the Agreement before the plaintiff unequivocally affirmed the Agreement in the Plaintiff’s First 7 November email?
[84]The defendant submits that in the Plaintiff’s August email, the Plaintiff’s August letter, the Plaintiff’s September letter and the Plaintiff’s 21 October emails the plaintiff was refusing to perform the Agreement according to its terms and that these communications therefore amounted to a repudiation of the Agreement. The defendant submits further that the plaintiff did not withdraw that repudiation at any time on or before 6 November 2014 and that the defendant accepted that repudiation and put an end to the Agreement on 6 November.
[85]While I agree that the combined effect of the Plaintiff’s August email, the Plaintiff’s August letter, the Plaintiff’s September email and the Plaintiff’s 21 October emails (set out above), in particular in those parts underlined by way of emphasis, amounted to a repudiation of the Agreement by the plaintiff, I do not agree that the defendant accepted that repudiation on 6 November 2014, or at any time before the plaintiff affirmed the Agreement in the Plaintiff’s First 7 November email.
[86]There is no evidence from anyone that any employee or agent of the defendant communicated to Mr Roberts (or any representative of the plaintiff) on 6 November 2014 that the defendant was treating the Agreement as at an end. As set out above, the evidence of Mr Roberts, Mr Irving and Superintendent Pollock is to the same effect. Superintendent Pollock was non-committal in the phone call on 6 November and there is no evidence of any other communication between the plaintiff and the defendant on that date.
[87]The defendant relies on Vitol SA v Norelf Ltd[24] in which Lord Steyn said:
I would accept as established law the following propositions. (1) Where a party has repudiated a contract the aggrieved party has an election to accept the repudiation or to affirm the contract: Fercometal S.A.R.L. v Mediterranean Shipping Co. S.A. [1989] AC 788. (2) An act of acceptance of a repudiation requires no particular form: a communication does not have to be couched in the language of acceptance. It is sufficient if the communication or conduct clearly and unequivocally conveys to the repudiating party that the aggrieved party is treating the contract as at an end. (3) It is rightly conceded by Counsel for the buyers that the aggrieved party need not personally, or by an agent, notify the repudiating party of his election to treat the contract as at an end. It is sufficient that the fact of the election comes to the repudiating party’s attention…[25]
[88]That case does not assist the defendant because the evidence does not disclose that the defendant communicated to the plaintiff in any form on 6 November 2014 that it was treating the Agreement as at an end or that it came to Mr Roberts’ attention by any other means that the defendant had elected to treat the Agreement as at an end. No-one from the defendant would communicate with Mr Roberts at all other than to say, effectively, “You will get a letter in due course.”
[89]To the extent that the defendant relies on the underlined statement in Vitol that it was not necessary for the terminating party to notify the repudiating party of his election to treat the contract as at an end, there is no evidence that anyone else did either.
[90]The defendant made a rather half-hearted suggestion that Mr Roberts had learned from some unidentified source that the defendant intended to terminate the Agreement, but there is no evidence to this effect.
[91]In cross-examination Mr Irving did not agree that the telephone call of 6 November was prompted by Mr Roberts having learnt that NTP proposed to withdraw from the two RTAs. He said, “My recollection is he [Mr Roberts] was concerned about the deal but I don’t recall him telling me that.”
[92]Mr Roberts was also cross-examined on the topic. At first he appeared to agree to this proposition:
Now, on 6 November 2014, you learnt that because of your conduct the Northern Territory police proposed to withdraw from the two agreements with Anchung. That’s correct, isn’t it?---Yes.[26]
[93]However, he later made it clear, in the following exchange, that that was a mistake.
MR YOUNG: I asked you a short time ago, Mr Roberts, this question, ‘On 6 November 2014 you learned that because of your conduct the Northern Territory police proposed to withdraw from the two agreements with Anchung?’ and you agreed, didn’t you?---On the basis that we were late - can you just repeat the question again, sorry?
I asked whether on 6 November 2014 you’d learned that because of your conduct the Northern Territory police proposed to withdraw from the two agreements with Anchung?---Not on the 6th.
Now you say it didn’t happen?---Sorry, on the 6th of November, Pollock - we had a conversation with Pollock on the 6th. He said we were receiving a letter.
Yes, but the first information you got wasn’t the letter, was it?---No, the discussion with Pollock - the first conversation with Pollock was in relation to the minister - sorry, the commissioner - being angry about the - - -
That’s on the 27th. We just deal with that?---Yep, yep, yep, yep. And then we had a conversation with Pollock - - -
On the 6th?---On the 6th, correct, with John, yes.
…
Put that aside. Now, when you spoke with Mr Pollock in the afternoon of 6 November, you spoke with him in the company of Mr Irving. That’s right, isn’t it?
---Correct, yeah.
And your evidence is that you spoke then about the delays and the funding difficulties that you’d faced. That’s right, isn’t it?---Yes.
And it would be fair to say by that afternoon you were trying to reassure Mr Pollock that you still wanted to supply the two police houses, weren’t you?---Yes. We were still going to perform them.
…
But Mr Pollock didn’t say anything that you regarded as encouraging in reply did he?---All the – Mr Pollock seemed to be just repeating that we would receive a letter and it would be sooner rather than later.
So he told you that you’d be receiving a written formal advice from the Chief Commissioner of Police in the near future didn’t he?---Yes.
And your call to Mr Pollock was really prompted by the knowledge that the Northern Territory Police proposed to withdraw from these agreements wasn’t it?---No it was – the phone call was probably because there was a change of personnel I was dealing with. And I didn’t know Mr Pollock at all. So naturally I – we were concerned because we were still trying to perform. And the conversation with Mr Pollock was about just reassuring him that we were able to perform.
…
I’m talking about what prompted the discussion you had with Mr Pollock in the afternoon of 6 November 2014. The subject of par 170 of your affidavit. And you’ve said you were concerned to contact him because he was the new point of contact?---Yes. And we’d put a proposal to them. We hadn’t received any other advice about the proposal other than the commissioner was angry.
Yes, and so you were waiting to hear - - - ?---Waiting to hear about that.
- - - whether they accepted?---Yes.
And you’d had the impression that they wouldn’t accept?---I had no idea. I hadn’t talked to anybody specifically about it.[27]
[94]In his affidavit, Mr Roberts deposed that following the discussion with Superintendent Pollock on 6 November 2014 he was concerned that the NTP might try to get out of the project and that is why he wrote the Plaintiff’s First 7 November email affirming the Agreement. (In other words, he did not telephone Superintendent Pollock on 6 November because he had heard that the defendant proposed terminating the Agreement. He became concerned that the defendant might try to get out of the Agreement as a result of the conversation with Superintendent Pollock on 6 November.)
[95]The evidence does not disclose that the defendant, by either words or conduct clearly and unequivocally conveyed to the plaintiff (directly or indirectly) that it was treating the contract as at an end on 6 November 2014 or at any time before the plaintiff sent the Plaintiff’s First 7 November 2014 email affirming the agreement. On 7 November 2014, in response to the Plaintiff’s First 7 November email affirming the Agreement, Superintendent Pollock still did not make it clear that the defendant was treating the Agreement as at an end. He emailed a response at 1:24pm Darwin time in which he wrote:
I thought I made it clear to both yourself and John yesterday that you would receive written formal advice in the near future regarding this matter. Can I ask that you await receipt of that advice before entering into any further correspondence.
[96]That prompted the Plaintiff’s Second 7 November email again affirming the Agreement.
[97]The Defendant’s 7 November letter would have had the effect of terminating the Agreement if the plaintiff had still been wrongfully repudiating the Agreement at that time, but it was not. That letter was too late. The plaintiff had unequivocally affirmed the Agreement some hours before in both the Plaintiff’s First and Second 7 November emails. Accordingly, the Defendant’s 7 November letter amounted to a wrongful repudiation of the Agreement.
Issue (ii): was it necessary for the plaintiff to accept any such repudiation before the time for the plaintiff’s performance expired in order to have a right to claim damages?
Principles
[98]Mason CJ said in Foran v Wight:[28]
A failure by the innocent party to treat an anticipatory breach of an essential term as a repudiation and to terminate the contract has the effect of leaving the contract on foot, in which event it remains in force for the benefit of both parties, just as it would if the anticipatory breach had never occurred, subject to a qualification to which I shall refer in a moment. … The qualification is that, if the repudiating party by his refusal to perform or other conduct intimates to the innocent party that he need not perform an obligation which is a condition precedent to the performance by the repudiating party of his obligation, and does not retract that intimation in time to give the innocent party an opportunity to perform his obligation, that party may be excused from actual performance of the condition precedent. The repudiating party then waives complete performance of the condition precedent and his conditional promise becomes unconditional.[29] [emphasis added]
[99]In Peter Turnbull & Co Pty Ltd v Mundus Trading Co (Australasia) Pty Ltd(“Peter Turnbull”)[30] Dixon CJ analysed the historical foundations of this principle:
Now long before the doctrine of anticipatory breach of contract was developed it was always the law that, if a contracting party prevented the fulfilment by the opposite party to the contract of a condition precedent therein expressed or implied, it was equal to performance thereof: Hotham v. East India Co. [1787] EngR 48; (1787) 1 TR 638 (99 ER 1295). But a plaintiff may be dispensed from performing a condition by the defendant expressly or impliedly intimating that it is useless for him to perform it and requesting him not to do so. If the plaintiff acts upon the intimation it is just as effectual as actual prevention. Jones v. Barkley (1781) 2 Dougl 684 (99 ER 434), is a case decided more than half a century before it was found possible to sue as for an anticipatory breach of contract. As will be seen from Lord Mansfield’s judgment it went upon the principle which in my opinion controls the decision of this appeal. Lord Mansfield said: “One needs only state what the agreement, tender, and discharge, were, as set forth in the declaration. It charges, that the plaintiffs offered to assign, and to execute and deliver a general release, and tendered a draft of an assignment and release, and offered to execute and deliver such assignment, but the defendant absolutely discharged them from executing the same, or any assignment and release whatsoever. The defendant pleads, that the plaintiff did not actually execute an assignment and release; and the question is, whether there was a sufficient performance. Take it on the reason of the thing. The party must shew he was ready; but, if the other stops him on the ground of an intention not to perform his part, it is not necessary for the first to go farther, and do a nugatory act” (1781) 2 Dougl, at p 694 (99 ER, at pp 439, 440). Thus too, Ripley v. M’Clure[1849] EngR 830; (1849) 4 Ex 345 (154 ER 1245), which might at a later date have been decided as a case of anticipatory breach, was placed by Parke B. upon the same ground. Lord Campbell C.J., in Cort v. The Ambergate &c. Railway Co.[1851] EngR 510; (1851) 17 QB 127 (117 ER 1229) gave an account of Ripley v. M’Clure[1849] EngR 830; (1849) 4 Ex 345 (154 ER 1245) which brought the point out clearly: “There being an executory contract, whereby the plaintiff agreed to sell and the defendant to buy, on arrival, certain goods, to be delivered at Belfast at a certain price, payable on delivery, it was held that a refusal by the defendant before the arrival of the cargo to perform the contract was not of itself necessarily a breach of it, but that such refusal, unretracted down to and inclusive of the time when the defendant was bound to receive the cargo, was evidence of a continuing refusal and a waiver of the condition precedent of delivery, so as to render the defendant liable for the breach of contract” (1851) 17 QB, at p 148 [1851] EngR 510; (117 ER 1229). …[31] [emphasis added]
[100]Kitto J agreed with the above statement of principle by the Chief Justice and summarised its effect succinctly in the following terms:
The principle, which applies whenever the promise of one party, A, is subject to a condition to be fulfilled by the other party, B, may, I think, be stated as follows. If, although B is ready and willing to perform the contract in all respects on his part, A absolutely refuses to carry out the contract, and persists in the refusal until a time arrives at which performance of his promise would have been due if the condition had been fulfilled by B, A is liable to B in damages for breach of his promise although the condition remains unfulfilled.[32]
[101]His Honour continued:
The doctrine of anticipatory breach is, of course, applicable as soon as A has communicated to B his refusal to carry out the contract. Under that doctrine B is put to his election. He may, if he chooses, treat the contract as brought to an end in consequence of A’s default, and recover damages from A for loss of the benefit of the contract. Alternatively, he may treat the contract as continuing on foot, in which case it will remain in force for the benefit of both parties, just as it would if the refusal had never been declared. If A persists in his refusal, B may at any time while the refusal continues elect to treat the contract as at an end and sue for damages; but unless and until he does so the contract remains on foot, and A may withdraw his refusal and require B to perform the contract on his part, subject only to giving B reasonable notice of his change of intention: … But suppose that A’s refusal is never retracted; that B does not elect while the period specified by the contract for performance is unexpired to treat the contract as determined by reason of the refusal; and that no event occurs during that period to discharge the contract. I am supposing, of course, a case like the present where in all the circumstances the refusal necessarily conveys to B that he need not trouble to fulfil a condition to which A’s obligations under the contract are subject, because even if he does A will still not perform his obligations. Is it true in such a case to say that A’s continued refusal must not be allowed any significance in an action by B against A, in which B seeks damages for not getting what he bargained for and A seeks to defend himself by relying upon the condition which he has all along shown that he was not concerned to have fulfilled? What does it matter for the purposes of that action that the refusal was not treated as ending the contract and as founding an action for anticipatory breach? The damages claimed are not for loss of the contract by premature termination, but for loss of the benefit which performance of the contract in accordance with its terms by both parties would by now have produced to B but for the fault of A. It is a cause of action which the facts I have assumed make out, unless the non-fulfilment of the condition is an answer to it; and as to that the inescapable fact is that A’s refusal was a continuing intimation that the condition need not be observed, and it did not become any the less an intimation to that effect because B chose not to determine the contract before its time. The intimation having continued until the time came when A would certainly have been in default if the condition had been fulfilled, the law, as I understand it, treats A’s obligation as absolute, and holds B entitled to damages for not having got what A promised he should have in the event of the condition being fulfilled.[33] [citations omitted] [emphasis added]
[102]In Foran v Wight, Brennan J (as he then was) made it clear that the effect of these cases was that, in a case such as the present, the innocent party may sue the party who has committed an anticipatory breach for damages, notwithstanding that the innocent party did not accept the repudiation before the due date for performance of the innocent party’s obligations. His Honour quoted the remarks of Kitto J in Peter Turnbaull and said:
Where A refuses to complete and thereby intimates to B that he need not trouble to fulfil a concurrent condition on which A’s obligation to complete is dependent, B may be entitled to sue for A’s actual breach though B elected not to terminate the contract before the time for completion arrived.[34]
[103]The theoretical basis for this result was expressed by Brennan J in the following terms:
The basis on which a party is dispensed from tendering performance is that an equity is raised against the party giving the intimation which is satisfied by treating him as though he had prevented the innocent party from tendering performance: see Waltons Stores (Interstate) Ltd. v. Maher [1988] HCA 7; (1988) 164 CLR 387. Such an equity enures for the benefit of the party who has acted on the intimation, but it does not impair the contractual obligation of the party giving the intimation.[35]
[104]Applying those principles to the facts in this case:
(a)The parties entered into a binding Agreement which included agreements for sub-leases over the Land in the form of the RTAs.
(b)The commencement of each RTA was subject to the satisfaction of a condition precedent, namely, the handover by the plaintiff to the defendant on or before 31 December 2014 of a house meeting agreed specifications, installed and habitable on the relevant Lot at Milikapiti on Melville Island.
(c)By the Defendant’s 7 November letter, the defendant indicated its intention not to proceed with the RTAs. This was an anticipatory breach of an essential term of the Agreement which the plaintiff was entitled to treat as a repudiation.
(d)The plaintiff did not treat the letter as a repudiation and put an end to the contract before 31 December 2014, which (it is common ground) was the date upon which the plaintiff was due to perform its part of the contract.
(e)However, the Defendant’s 7 November letter was a clear indication by the defendant to the plaintiff that the plaintiff need not install the houses on the Land because the defendant had no intention of accepting possession of them. Despite a number of communications to the defendant by the plaintiff and its solicitors, the defendant continued to assert that there was no binding legal agreement. The defendant did not retract that intimation in time for the plaintiff to perform its obligation – ie to construct the houses by the due date – or at all. The defendant must therefore be taken to have waived performance of that condition precedent; the plaintiff is excused from actual performance of the pre-condition and the plaintiff is entitled to sue for damages for breach of the Agreement.
[105]That is not to say that the plaintiff is not obliged to show that it was ready, willing and able to perform its obligation. As Dixon CJ said in Rawson v Hobbs:[36]
It is hardly necessary to say that once there has been a renunciation of a contract or of future performance of an essential obligation thereof by one contracting party, the other if he elects to treat that as an anticipatory breach discharging the contract is relieved from all further obligation to perform on his side and in consequence need not thereafter be ready and willing to do what would otherwise be his part. But that is not the question. What is the question is whether up to that point he must not be ready and willing to proceed with the contract and, as and when the time comes to do his part, so far as it is of the essence, to perform the contract on his side.[37] [emphasis added]
[106]In Foran v Wight, Mason CJ said:
A waiver of a condition precedent arising from the defendant’s repudiation did not entirely relieve the plaintiff from showing that he was ready and willing; the plaintiff was dispensed from the need to do that which the defendant had indicated would be pointless. He was not excused from showing that at the time of repudiation he was ready and willing to complete the contract had it not been repudiated by the defendant.[38] [citations omitted]
[107]Dixon CJ in Rawson v Hobbs referred to the “erroneous contention” that when a party renounces a contract and the innocent party accepts the renunciation and sues, the renouncing party cannot require the innocent party to prove his readiness and willingness to perform his obligations under the repudiated contract and concluded:
One must be very careful to see that nothing but a substantial incapacity or definitive resolve or decision against doing in the future what the contract requires is counted as an absence of readiness and willingness. On the other hand it is absurd to treat one party as tied to the performance of an executory contract although the other has neither the means nor intention of performing his part when his turn comes, simply because his incapacity to do so is not necessarily final or logically complete.[39] [emphasis added]
[108]The question, then, is whether the plaintiff can show that as at 7 November 2014, it had a “substantial capacity” to perform its obligation to construct the two houses on the Land by 31 December 2014 and had not “definitively resolved” not to do so. The date at which this must be shown is the date the defendant indicated to the plaintiff that it did not intend to be bound by the agreement and thereby excused the plaintiff from performing the pre-condition – 7 November 2014.
Issue (iii): Was the plaintiff ready, willing and able to complete the Agreement as at 7 November 2014?
[109]In my view the plaintiff can show that as at 7 November 2014, it had a “substantial capacity” to perform its obligation to construct the two houses on the Land by 31 December 2014 and had not “definitively resolved” not to do so. The plaintiff’s resolve is evidenced by the Plaintiff’s 7 November letter in which Mr Roberts advised the defendant:
The agreement between us … has specific terms and conditions which I can confirm are unchanged and as such request your confirmation immediately that you will accept occupancy under the agreement, time is of the essence here.
[110]This was followed by further correspondence to similar effect from the plaintiff’s solicitors (referred to above) trying to convince the defendant to change its mind and continue with the project.
[111]As to its capacity, the defendant submits that the plaintiff would not have been able to complete the houses by 31 December 2014 for two reasons (a) impecuniosity; and (b) shortness of time.
Impecuniosity
[112]The defendant relies on the following evidence to support its contention that the plaintiff did not have the financial capacity to complete the two houses.
[113]First, the defendant points to the evidence of Mr Roberts that the plaintiff’s sole function and activity was to act as trustee of the Neville Roberts Family Trust so that, if the plaintiff had any assets, they were all assets of the trust. That is neither here nor there. If acting as trustee of the trust was the sole function and activity of the company it must be inferred that the Agreement was made by the plaintiff in its capacity as trustee of the trust and the plaintiff would have had a right of indemnity over trust assets for liabilities incurred in carrying out the Agreement. This is an extremely common business arrangement.
[114]Next, the defendant relies on evidence from Mr Irving in cross-examination that without obtaining further funding, the plaintiff could not have paid the costs of installing the houses at Milikapiti in November and December 2014. However, the question is not whether the plaintiff could have constructed the houses from its own assets without obtaining further funding, it is whether the plaintiff could have financed the construction.
[115]Mr Roberts had obtained a quote from Mr Drenth to complete the installation. That quote was for $271,260, inclusive of GST. The evidence of both Mr Roberts and Mr Drenth was that the quote was accepted. Mr Drenth confirmed that his quote included getting the houses out of storage, getting them to Milikapiti, erecting them on the site and connecting them to power, water and sewer lines. It also included the cost of the footings.[40]
[116]Mrs Roberts had received a legacy of $283,000.00 in October 2014. The evidence of both Mr and Mrs Roberts was that they had resolved to make $100,000.00 of that available to the plaintiff. Mr Roberts’ evidence was that, if necessary, the whole amount would have been made available. Mrs Roberts was not cross-examined. Mr Roberts’ evidence in this regard was not contested and I accept that, if necessary, the whole of the Roberts’ funds would have been available to enable the houses to be constructed. It would have made simple economic sense for them to have made the funds available to their family company to enable the project to be completed so as to recoup, over time, the money that had already been outlaid in the purchase of the houses in the form of rent to be paid by the defendant.
[117]The defendant placed emphasis on the fact that the plaintiff’s financial advisor, Mr Irving, agreed in cross-examination that in November 2014 and after, the plaintiff was “under financial stress” and “in a difficult financial position”. The defendant relied on evidence which showed that at the relevant time the plaintiff’s total liabilities exceeded the value of its assets by around $750,000.00 to $800,000.00; that it had outstanding loans listed on its balance sheet as current liabilities that had not been paid; that it had not yet at that time paid for the houses;[41] and that it had it borrowed $450,000.00 to install the houses but used the money for “general purposes”.
[118]On the basis of this evidence, the defendant submitted that the plaintiff was in fact insolvent in November/December 2014. When cross-examined, Mr Roberts did not agree. Nor did Mr Irving. As Mr Irving (who had been an insolvency practitioner for 30 years, and was an official liquidator) explained, the definition of insolvency is an inability to pay one’s debts as and when they fall due: it is not a balance sheet test, it is a cash flow test. Mr Irving’s evidence was that arrangements had been put in place with the plaintiff’s creditors such that they were not expecting to be paid immediately. He also said that most of the plaintiff’s liabilities were intercompany liabilities, so that the three related companies would have to be looked at together. It should be noted that as at the date of the trial, the plaintiff was not in liquidation.
[119]Counsel for the defendant suggested to Mr Roberts that the cost of installing the houses would have been well in excess of $271,000.00 – somewhere in the range of $420,000.00 to $500,000.00. Mr Roberts did not agree. He agreed that there were additional costs over and above the $271,000.00 quoted by Mr Drenth, but said that he had never paid such a high figure to install houses of this nature. He agreed with a number of suggestions by counsel for the defendant in cross-examination that certain items had not been allowed for in his costings and disagreed with others. Essentially, he stood by his evidence that the total cost to install the houses, including the fencing and other extras, would have been “just under $300,000.00”. (Much of this cross-examination was by reference to amounts that had originally been inserted in the statement of claim and later crossed out when the statement of claim was amended. As there was no evidence before me of the circumstances in which these figures came to be inserted into the original statement of claim or why they were deleted, I do not place any significance on those figures, relying instead on the evidence in the affidavits and in cross-examination.)
[120]As explained in more detail below, it would have been necessary to put in an extension to the sewer line in order to connect the houses. So far as the cost of the sewer extension is concerned, Mr Roberts said that he estimated the cost as about $60,000.00 and that there was a generous allocation for trenching in his cost estimate and the quote from TDC but it fell short of $60,000.00. He said that there was also an allowance of $30,000.00 to $50,000.00 for contingencies and the extra trenching would have “eaten into” that allowance.
[121]Mr Clarke and Mr Drenth were also cross-examined about whether the additional cost of extending the sewer line had been fully costed or included in the quote given by TDC and accepted by Mr Roberts. The evidence of Mr Clarke about that was that he had analysed the quote and had seen that connecting all services including the sewer line was part of the contract. He noted the costs in the quote included “plumbing, hot water, mains; $15,000.00 per home” and then $30,000.00 in the final column as well. He also said in cross-examination that if there was a dispute about precisely what was in the scope of works, the job would still have been carried out; there would simply have been a dispute at a later date about whether the contractor should be paid extra for a variation.
[122]Mr Drenth agreed that the cost of trenching would have been allowed for in his quote because, he said, the installation costs were “nowhere near [the amounts referred to above] just to connect to the buildings”.
[123]Both Mr Roberts and Mr Drenth were referred to an email from Mr Clarke saying it would be “a huge cost and liability to bring the sewer to site”, and both disagreed. Mr Roberts explained that at that time Mr Clarke was new to the job of building in remote locations and was still learning.
[124]I accept the evidence of Mr Roberts and Mr Drenth that the additional cost of the sewer extension was substantially taken into account in the existing quote. I do not accept that any additional cost would have been a barrier to the plaintiff’s financial capacity to complete the houses by 31 December 2014.
[125]Bearing in mind the statement of Dixon CJ in Rawson v Hobbs, that “[o]ne must be very careful to see that nothing but a substantial incapacity or definitive resolve or decision against doing in the future what the contract requires is counted as an absence of readiness and willingness,”[42] I do not think the approach adopted by counsel for the defendant of attempting to add up the cost of every item and balance that against the money available to the plaintiff at the time is the correct one. This is not a case in which the Court must assess whether a plaintiff could have tendered a specific sum on a particular date to enable settlement of a conveyance to occur. There is nothing to say that the plaintiff would have had to pay every account from every supplier before completing the construction. As Mr Irving pointed out, the plaintiff had the capacity to make arrangements with its creditors (and had done so) and once the houses were complete, it would have had an income stream from the rent payable by the defendant with which to pay outstanding accounts.
[126]I accept the evidence of Mr Roberts and Mr Irving that the plaintiff had the financial capacity to complete the construction of the two houses by 31 December 2014.
Time constraints
[127]I also find that the work could have been completed within the necessary time frame.
[128]Both Mr Roberts and Mr Drenth gave evidence that the necessary work could have been done in time, and the defendant called no evidence that it could not have been completed in time.
[129]Mr Roberts was adamant that the houses could have been constructed within 30 days and was unshaken in cross-examination. He said that he had been planning on starting work on 24 November had it not been for the defendant’s repudiation. This is supported by evidence of an email from Mr Drenth to Mr Roberts dated 10 November 2014 saying: “We have a window to complete the install from 24 November, finishing just before Christmas”.
[130]Mr Drenth explained that the start date of 24 November referred to in his email took into account his other work commitments, but said he would have had extra resources (men and equipment) to put towards the project if he had been asked to go ahead straight away on 10 November. He said it would only have taken a week to ten days to erect the houses and do everything except garden sheds and fences and connecting to power, water and sewer line.
[131]Mr Drenth confirmed that if he had been given the go ahead on 10 November, the homes could have been fully installed with connections by 28 November if there had been a sewer line to the site. He said that some additional time would have been needed for the sewer line extension.
[132]Both Mr Roberts and Mr Drenth said that because there is no concreting involved in the construction of these houses (except for a small amount for a step at the front door and the back door) they can be erected in ordinary wet weather if necessary. (There was no evidence before me of the existence of any extreme weather event such as a cyclone during the relevant period.)[43]
[133]In answer to questions asked in cross-examination Mr Roberts said the plaintiff could have completed the houses by 31 December if they had started on 1 December; “it would have been a stretch” if they had started on 7 December; and they could not have done it if they had started on 14 December. When pressed, he said that the last day on which they could have started for it to have been possible to finish the job by 31 December would have been 10 December. That would have involved two crews working 12 hours a day with only one day off (Christmas Day).
[134]Mr Roberts emphasised the special nature of the kit homes and said that he had put one of those houses up between 6:00 am and 10:00 pm at night, “completed and locked up, footings, everything”.
[135]Mr Clarke’s evidence was that a crew of three could install the footings for less than a day. He also deposed that because of the nature of the units which are designed for easy transport and installation it was simply a matter of getting them to the site, properly anchoring them to the ground, connecting up the services and installing a few extra items such as fences that were required by NTP. He deposed that he was not aware of any practical or logistical reason why the plaintiff could not have completed the installation in 2014 if they had started in November or even early December. He said the essential requirements such as transportation (for the units), trades, labour and parts and the units themselves were all ready at that time.
[136]As indicated above, the plaintiff had encountered difficulties with the connection of services to the two blocks. Water and electricity were available at the blocks but the nearest sewer connection was about 160 metres away. It would have been necessary for the plaintiff to construct a sewer extension. Moreover, there was an open drain between the blocks and the nearest connection which may have caused a problem with the fall of the extension from the houses to the sewer main. Before the defendant called a halt to the project, it had not been established whether the sewer extension could have been constructed via the most direct route, or whether, perhaps, it might have been necessary to install a pump.
[137]In addition, there was a tree on one of the blocks which might have required the resiting of the house on that block. That was something that the plaintiff would have had to work out with the architects who were doing the site plan and (perhaps) a qualified arborist. Again, things did not progress that far before the defendant called a halt.
[138]In relation to the sewer line, Mr Roberts’ evidence was that his original 30 day estimate for construction of the houses included getting the necessary approvals and constructing the sewer extension. He was questioned about a list of requirements Mr Clarke had obtained from Power and Water and said that in his experience the processes are grossly overstated on the website and official information given out by Power and Water compared to his experience in the field; that the relevant arrangements could have been made quite quickly before installation; and that Power and Water are very supportive of contractors and are consistently expediting the process especially on remote area developments. He said that, on occasion, he had had approvals granted by return email.
[139]Mr Drenth said he had been building for ten years in the Northern Territory and had been dealing with Power and Water since he started. He had been involved with installing sewer line extensions and septics in remote communities repeatedly over that period of time, and that in his experience it can be done quickly, without fuss. He did not dispute that there was an approval process involving submission of engineering plans and designs, and assessment of their viability, but said that “we do that on a day to day basis with our plumbers and the hydraulic engineers”. In re-examination, Mr Drenth was asked to describe the process of getting Power and Water approvals. He said they get a site plan showing all services from the Power and Water website and derive a plan of where to tap into each service, i.e. power, plumbing, sewer and water. The plumber then gets a hydraulic engineer to draw up the plans which consist, essentially, of a line on a map/pro forma drawing. They stamp it, and the builder sends that off to Power and Water with an application to connect into their main services. The whole process generally should take no more than a week and is done while construction is taking place because of time constraints.
[140]There was extensive cross-examination of Mr Roberts and Mr Drenth in relation to the problems with the sewer line. Again, much of it focused on the details of possible solutions, for example whether it would have been necessary to install a pump because of the fall of the sewer extension complicated by the gully the line would have had to cross and, if so, whether Power and Water would have given approval for such a pump. Both Mr Roberts and Mr Drenth were more pragmatic. They said that they had built similar buildings in remote communities many times before, that in practice the Power and Water officers were helpful to contractors, that they had engaged experienced plumbers who they trusted and that a solution would have been found: if a pump proved necessary, they would have installed one; if that was not possible they would have looked at installing a sewer treatment plant (a form of septic system). I accept this evidence. It cannot be that the construction of two houses on these lots was impossible because there was no workable way to get a sewer line to the site.
[141]The evidence of Annette D’Emden from Power and Water which was intended to cast doubt on the plaintiff’s ability to have the sewer connection completed in time fell short of establishing that.
[142]In relation to the tree, the evidence of Mr Roberts and Mr Clarke was that they would have kept the tree, not least for aesthetic reasons, and that it would have been a simple matter to re-draw the site plan to place the house on that block in a different position. There was some cross-examination about potential difficulties, including the distance between the tree and the house required to avoid tree root intrusion into the foundations. However, the evidence was that such considerations are mainly relevant where the foundations consist of a slab, and are not really applicable to the kind of footings used in these houses. In any event, as explained above, the relevant question is whether the plaintiff had a “substantial capacity” to perform its obligation to construct the two houses on the Land by 31 December 2014 and in answering this question I do not consider it appropriate to descend into minute detail about every possible contingency.
[143]There should be judgment for the plaintiff.
Damages
[144]The plaintiff claims the net present value of the loss of rent over the initial 20 year term of the lease plus storage costs for the units plus an amount for increased interest on financing.
[145]To support its claim for lost rental the plaintiff called expert evidence from Mr Timothy Clifton a chartered accountant from Clifton Hall. Mr Clifton prepared a spreadsheet setting out his calculation of the current value of the lost rental but there were a number of errors in his calculations. The figure Mr Clifton arrived at for the net present value of the lost rental income (using a discount rate of 8%) was $737,995.00.
[146]In cross-examination Mr Clifton admitted that he had miscalculated the initial annual rental. He also conceded that in calculating the CPI increases he did not use the CPI All Groups for the City of Darwin as required by the RTAs but instead used an assumed figure of 2.5% and he increased the rental by this assumed figure for CPI every year ignoring the fact that the RTAs provided for rental reviews to market value every five years. Mr Clifton’s figures for expenses (the sub lease amount, repairs and maintenance, insurance and property management) did not include GST.
[147]The defendant prepared another spreadsheet correcting for the initial annual rental, using the actual figures for CPI increases up to the date of the trial, and thereafter calculating the CPI increases using the average of the annual increases in the CPI All Groups City of Darwin over the five years from 1 July 2012 to 30 June 2016 with zero increase in the years when the rent is to be reviewed to market. The defendant also added GST to the allowances for expenses. The figure the defendant arrived at for the present value of the lost rental income (also using a discount rate of 8% which the parties agreed was the appropriate rate) was $674,945.00.
[148]I consider the defendant’s calculations to be an appropriate starting point (because the starting figure for the rental is correct and it is appropriate to use actual figures where available)[44] but that the following adjustments should be made.
[149]First, I consider that the appropriate CPI rate should be the average of the annual increases in the CPI All Groups City of Darwin over the 10 years from December 2007 to December 2016 (which is 2.3339%). The term of the RTAs is 20 years, the present CPI increases are at an historical low, and there is no telling whether they are likely to increase or decrease. I therefore consider it more appropriate to take an average over a longer period.
[150]Second, I do not think it is appropriate to factor in zero increase in the years when there is to be a review to market. It is true that there is at present likely to be very little market for rental properties in Milikapiti. However, that may change over the next 5 to 15 years. Further, it can be inferred that there is presently no suitable housing for police in Milikapiti, since there was still no permanent police presence there at the date of the trial due to an absence of suitable housing. That being the case, it cannot be assumed that the plaintiff would be in the weaker bargaining position when the time came for market reviews. I think the fairest assumption would be that the rent would continue to increase by an amount roughly equivalent to the increase in the CPI in the market review years.
[151]The plaintiff did not account for GST on the expenses of repairs and maintenance, insurance and property management. The plaintiff also did not include GST on the amount payable on the sub-lease amount. The OTL sub-leases are subject to GST,[45] but the supply of private leased residential premised is input taxed.[46] Accordingly, the plaintiff would not be entitled to claim input tax credits for the GST payable on the sub-lease amount and the plaintiff would ultimately have borne these expenses.
[152]The figure I have reached for the net present value of the lost rent using those assumptions (and again using an 8% discount rate) is $724,490.95. A spreadsheet setting out this calculation is attached to this judgment.
[153]The plaintiff’s expert, Mr Clifton made no allowance for any deductions from that figure for the expenses yet to be incurred by the plaintiff in completing the houses and which the plaintiff has saved as a result of the defendant’s breach – because he was not instructed to do so. Such amounts obviously need to be deducted. The defendant submitted that those costs would have amounted to $511,000.00. In arriving at that figure, the defendant added the cost of numerous items that the defendant submitted had not been included in the quoted price from TDC. In cross-examination, Mr Roberts did not agree that there had been no allowance for some of those items. In relation to others, he did not agree with the amounts suggested. Further he pointed to allowances for contingencies in the quoted figure. Both he and Mr Drenth agreed that the additional cost of the sewer extension was covered by that quote. As set out above, I accept Mr Roberts’ evidence that, on the basis of his experience in constructing houses of this nature in remote communities, the cost to construct the two houses to the required specifications, including the fencing and car port would have been just under $300,000. (That is just under $30,000 over the quote received from TDC to allow for various contingencies.) I consider that the appropriate figure to deduct from the value of the lost rental is $300,000, giving a figure of $424,490.95 for the net present value of the lost rental.
[154]In addition, the plaintiff has claimed $77,484.00 for storage costs for the two houses which would not have been incurred if the defendant had allowed the houses to be constructed. I consider this amount should be allowed.
[155]The plaintiff has also claimed $21,731.00 for increased interest costs. However, as the defendant pointed out, the plaintiff adduced no evidence of such losses. I therefore make no allowance for additional interest.
[156]Damages are therefore assessed at $501,974.95. I allow interest on that sum pursuant to s 84(1) of the Supreme Court Act at 4% per annum simple interest for half of the period from 31 December 2014 to 9 June 2017, a sum of $24,479.87, bringing the total to $526,454.82.
[157]There will be judgment for the plaintiff in the sum of $526,454.82.
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[1] It was clarified in evidence by the present Commissioner that this meant making suitable houses available for leasing by police.
[2] There was quite a long delay between receipt of the RTAs on 11 February and their execution on 19 March. During this time there were various internal communications within the NTP which are not relevant to this proceeding.
[3] The evolution of the defendant’s position in relation to this is discussed below.
[4] Mr Roberts finally found one of the Tiwi families willing to invest in the project but only if the return was greater.
[5] email from the plaintiff to the defendant, among others, sent at 8:20am on 21 October 2014
[6] email from the plaintiff to the defendant, among others, sent at 11:31am on 21 October 2014
[7] sent at 11:31 (12:31 Darwin time)
[8] Before this, Ms Hulm had responded to Mr Roberts’ emails saying, effectively, that the decision had to be made at a higher level and that she had passed his requests on to the relevant superintendent.
[9] On 29 October Johnny Cool Darwin provided a quote for connection of electrical services for $15,722.30, but this was included in the quote of $271,260 from TDC.
[10] appointed as Commissioner on 14 April 2015
[11] at [21] of his affidavit of 3 June 2016
[12] at [23]
[13] at [26]
[14] He referred in his affidavit to “lack of tangible evidence to demonstrate that the houses would be delivered”.
[15] In cross-examination Commissioner Kershaw admitted that he had not spoken to Ms Hulm or had access to Ms Hulm’s file (referred to as the Human Resources file) and that the only information he had about the Agreement with the plaintiff came from two briefing notes in July and August which contain only the briefest reference to the Agreement and no information about the type of houses or method of construction.
[16] In cross-examination he admitted that he had had no contact with anyone from Anchung.
[17] In his affidavit, Commissioner Kershaw says that he was aware that tenancy agreements had been drawn up and knew of their existence in October 2014, but does not recall whether he knew of the exact dates of the documents at that time – which he presumably would have been able to see had he read them. However in cross-examination he said he had “viewed them” before he made the decision in November
[18] Affidavit of Neville Roberts sworn 10 May 2016 para [170]
[19] One of the purposes of the trip to Milikapiti on 5 December was “to consider possible alternative housing”.
[20] mistakenly referred to in the Statement of Claim as a letter of 12 March 2015
[21] The specification in the email of 29 January 2014 was “main bathroom to include bath and shower (or shower over bath combination)” and the response by the plaintiff was “not as yet approved depends on manufacturer and will advise”.
[22] Ms Hulm signed and returned the execution pages of the RTAs in August.
[23] For example, both agreed that Ms Hulm communicated to Mr Roberts that the defendant would not purchase houses, only lease them. Mr Roberts believed Ms Hulm said that NTP did not have the capital to buy; Ms Hulm believed she was referring to the policy of police housing. Nothing at all turns on this.
[24][1996] AC 800
[25] Ibid 810-811
[26] Transcript of Proceedings, Anchung Pty Ltd v Northern Territory of Australia (The Supreme Court of the Northern Territory, SC 31/2015 (21517154), Kelly J, 25 July 2016) 75
[27] Ibid 76-78
[28] [1989] HCA 51; (1989) 168 CLR 385
[29] Ibid 395-396
[30] [1954] HCA 25; (1954) 90 CLR 235
[31] Ibid 246-247
[32] Ibid 250
[33] Ibid 250-251
[34] Foran v Wight (1989) 168 CLR 385, 419
[35] Ibid 420
[36] [1961] HCA 72; (1961) 107 CLR 466
[37] Ibid 480-481
[38] (1989) 168 CLR 385, 398
[39] Rawson v Hobbs (1961) 107 CLR 466, 481
[40] In this type of construction the footings are not concreted into the ground. They consist of 40 ml pipe, driven into the ground with jack hammers as far as they will go. It is called a Mega Anchor system.
[41] Mr Roberts’ evidence was that the manufacturer had been paid and that the plaintiff had incurred a debt to what appears to have been a related entity.
[42] (1961) 107 CLR 466, 480-481
[43] In re-examination Mr Drenth explained that when a thunderstorm comes over in the wet season, they put down tools for an hour while it goes over and then get back into it.
[44] The defendant used the actual change in the Darwin All Groups CPI at 31 December 2014 (1.88%) and at 31 December 2015 (0.46%) when calculating the figures for those years.
[45] Being a taxable supply (A New Tax System (Goods and Services Tax) Act 1999 (Cth) s 9-40). The OTL is an activity, or series of activities done by the Commonwealth or by a body corporate, or corporation sole, established for a public purpose by or under a law of the Commonwealth (A New Tax System (Goods and Services Tax) Act 1999 (Cth) s 9-20(1)(g))
[46] A New Tax System (Goods and Services Tax) Act 1999 (Cth) ss 9-30(2)(a), 40-35(1)(a)
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