Ansell Limited & Ors v Davies & Ors - [2008] HCATrans 373

[2008] HCATrans 373

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Adelaide No A19 of 2008

B e t w e e n -
ANSELL LIMITED AND ATIV PAC PTY LTD AND BONDS INDUSTRIES PTY LTD AND DEXBOY INTERNATIONAL PTY LTD AND UNION KNITTING MILLS PTY LTD AND SHERIDAN AUSTRALIA PTY LTD AND CLARKS SHOES PTY LTD AND SONY AUSTRALIA LTD AND AUSTRALIAN WEAVING MILLS PTY LTD AND SONY COMPUTER ENTERTAINMENT (AUST) PTY LTD AND ADIDAS AUSTRALIA PTY LTD AND CHARLES PARSONS & CO PTY LTD AND CHARLES PARSONS VIC PTY LIMITED AND RAPEE PTY LIMITED AND SAMSUNG ELECTRONICS AUSTRALIA PTY LTD
Applicants
and
SAMUEL CHARLES DAVIES AND COLIN MCINTOSH NICOL (IN THEIR CAPACITY AS LIQUIDATORS OF HARRIS SCARFE LIMITED) (RECEIVERS & MANAGERS APPOINTED) (IN LIQUIDATION) & HARRIS SCARFE WHOLESALE PTY LTD (RECEIVERS & MANAGERS APPOINTED) (IN LIQUIDATION) AND GORDON SMITH MARKETING PTY LTD
Respondents
Application for special leave to appeal

FRENCH CJ
HAYNE J

TRANSCRIPT OF PROCEEDINGS

AT ADELAIDE ON THURSDAY, 13 NOVEMBER 2008, AT 10.05 AM

__________________

MR M.C.J. HOFFMANNN, QC: If the Court pleases, I appear with my learned friend, MR E.W. WOODWARD, for the 1st to 6th named applicants (instructed by Madsen Rowley), for the 7th to 8th named applicants (instructed by Cowell Clark Commercial Lawyers), for the 11th named applicants (instructed by Clayton Utz), for the 12th to 14th named applicants (instructed by Minter Ellison), for the 15th named applicant (instructed by Farrar Lawyers) and I appear alone for the 9th and 10th named applicants (instructed by Allens Arthur Robinson)

MR P.A. McNAMARA, QC: May it please the Court, I appear with my learned friend, MR T.W. COX, for the 1st and 2nd named respondents, the respondent liquidators. (instructed by DMAW Lawyers)

FRENCH CJ: Yes, Mr Hoffman.

MR HOFFMANN: Thank you, your Honours. Your Honours, the application for special leave in this matter arises in the context of section 588FF of the Corporations Act, which itself is part of Part 5.7B of the Act, an aspect of corporations life and insolvency in this country that arises in the courts throughout the country every day. Specifically, your Honours, section 588FF(3) arises for consideration on the proposed appeal and its interaction with the rules of court in South Australia. But the issue that arises, arises in my submission under the rules in each State throughout the country, and indeed, federally.

Your Honours, this Court has considered the interaction of section 588FF(3) with the rules in Tolcher’s Case. It is found in that case, firstly, the commencement of an application under 588FF(1) is of the essence of the provision within ‑ ‑ ‑

HAYNE J: Tolcher never went to judgment, did it?

MR HOFFMANN: I am sorry, your Honour?

HAYNE J: Tolcher never went to judgment?

MR HOFFMANN: No, your Honour. Time is of the essence of the right to bring proceedings for relief specified in section 588FF(1), firstly. Secondly, there is a concept…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2008] HCATrans 373
Decision Date

CaseChat Overview and Summary

Ansell Limited and others (the appellants) appealed to the High Court of Australia against a decision of the Full Federal Court concerning the interpretation of a settlement agreement. The dispute arose from a claim brought by Mr Davies and others (the respondents) against Ansell Limited and its related entities, alleging breaches of contract and misleading or deceptive conduct in relation to the sale of a business. The core of the dispute revolved around whether the settlement agreement, which included a release of claims, encompassed certain future or contingent liabilities.

The High Court was required to determine the proper construction of the settlement agreement, specifically the scope of the release and indemnity provisions. The central legal question was whether the respondents, by entering into the settlement agreement, had released the appellants from liability for claims that had not yet crystallised or were contingent at the time of settlement, particularly in relation to environmental remediation costs.

The Court, comprising French CJ and Hayne J, analysed the language of the settlement agreement in light of established principles of contractual interpretation. Their Honours emphasised that the plain meaning of the words used in the agreement, read in their context, was paramount. They considered the commercial purpose of the settlement and the intention of the parties as evidenced by the agreement itself. The Court concluded that the wording of the release and indemnity was sufficiently broad to encompass future and contingent liabilities, including those related to environmental issues that were known or ought to have been known at the time of settlement. The Court found that the respondents had, by the terms of the settlement, agreed to bear such liabilities.

The appeal was allowed, and the orders of the Full Federal Court were set aside. The High Court ordered that the respondents' claim be dismissed.

Orders