BlueScope Steel (AIS) Pty Ltd v OneSteel Manufacturing Pty Ltd

[2013] HCATrans 189

[2013] HCATrans 189

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S46 of 2013

B e t w e e n -

BLUESCOPE STEEL (AIS) PTY LTD

Applicant

and

ONESTEEL MANUFACTURING PTY LTD ABN 42004651325

Respondent

Application for special leave to appeal

HAYNE J
KEANE J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 16 AUGUST 2013, AT 11.46 AM

Copyright in the High Court of Australia

MR B.W. WALKER, SC:   May it please the Court, I appear with my learned friends, MR R.A. DICK, SC, and MR B.R. KREMER for the applicant.  (instructed by Holding Redlich Lawyers)

MR N.C. HUTLEY, SC:   If your Honours please, I appear with my learned friend, MR S.A. LAWRANCE, for the respondent.  (instructed by Allens)

HAYNE J:   Yes, Mr Walker.

MR WALKER:   Your Honours, may I take you immediately to the provision of the contract at the heart of the matter, application book pages 58 and 59 in clause 4.  Your Honours will have seen the significance or otherwise already in the reasons below given to the last words of 4.1(a), which appear on page 58, about line 52.  That is a phrase which Justice Allsop used or read in such as a way as to deprive it, we submit, of what I am going to call its plain meaning.  That is a phrase that subjected the obligation in the opening words of 4.1(a), which played such a large part in his Honour’s reasoning - that is a phrase that subjects that obligation to what follows. 

In clause 4.1(d), which is right at the heart of the matter on page 59, there is equally, in our submission, in a commercial contract of some complexity the striking feature that these are plain words.  The grammar, the syntax, the ordinary meaning in context and read commercially are plain, in particular, we submit, as was the position taken at trial by the parties recorded by his Honour.  There was here no ambiguity.  We do not need to play word games about the ambiguity of the word “ambiguity”.  Neither was it said, except insofar as there were vying parties about the meaning of this term, neither was it said that by reason of some linguistic quality any of these words were susceptible of more than one meaning.  The commercial effect of the meaning of the words was what was contested.  That does not provide the ambiguity or susceptibility to more than one meaning. 

In that clause, in particular, may I focus on the words that you see at about lines 24 and 28.  Stripping out the unnecessary parts the logical structure is compelling.  If the buyer requests then the buyer shall.  There is nothing in the other words in that part of the sentence that detracts from the inexorable plainness of that structure logically, linguistically and, we submit, commercially. 

What it shall do is pay any dead freight subject to something that does not currently matter.  In short, there is a commercial outcome at a rate which is calculated with respect to the non‑shipping of a commodity at a price which is calculated.  Of course this is all about money and commercial considerations of self‑interested parties which had reached a contract at arm’s length, parties which it need hardly be said would attract no tenderness whatever in terms of inequality or equality of bargaining power.

In subparagraph (ii) there is one other thing that follows and it is very, very significant in the way it is framed.  Having said no thanks to a load of iron ore finds, that is, the request upon which there shall be dead freight in respect of that shipment, there is then an opportunity - the words are “advise”, “wishes” and “request”, the first and third lines - to petition the seller, the seller who will have got dead freight only for the shipment about which the first request was made.

As to that petition - my word for the “advise”, “wish” and “request” notion - that petition is one to which the seller may choose to acquiesce or not, subject only to the contractual standard agreed by the parties that its response, that is, by way of agreement or not, is not to be unreasonably exercised.  That, in our submission, contained, as it happens, syntactically within all one sentence, that very, very plainly showed that the first request upon which “the Buyer shall” pay any dead freight is one to which the seller had no blocking answer available.  It was at the option of the buyer to request and that admits of no ambiguity or susceptibility of any other meaning. 

There is, within the deed, before one comes to the notion of extrinsic evidence material or considerations, there is within the agreement itself at application book 76 clause 12.3.6 to which close attention was paid, both in the argument against us and in the reasons upholding that argument causing our failure in the court below.  That, in our submission, simply has nothing to do with the kind of request with which we were concerned in this case.

Clause 12.3.6 appears, of course, in highly detailed provisions - section 12.3 headed “Shipping Arrangements and Schedules”, all of which has to do with just that.  It is a heading which is accurate, by reference to the text.  What one sees there is that there is no requirement, perhaps a more abundant caution, a spelling out that the seller is not required, is dispensed from arranging the ship’s schedule in response to any specific request.  Pausing there, that of course is not apt to include the highly particular request which leads to dead freight under the earlier clause. 

Similarly, one sees that this is obviously not intended to deal with the earlier request leading to dead freight because, in any event, 12.3.6, last sentence, starting at about line 33 on page 76, ends up with “Dead Freight”, but the beginning of that last sentence makes it clear that we are plainly talking about another kind of request altogether, that is, a request in relation to an arrangement of schedule because one sees that that is one that the seller may agree to or not. 

Now, the clear difference of operation of 4.1 and 12.3 is highlighted by the fact that the request which was in question in this case was in relation to a scheduled shipment.  It is a post arrangement of schedules, the schedules being made, and then there is an option given, at a risk of course of not later being able to catch up a shipment.  Clause 12.3.6 is in the course of arranging schedules. 

So, in our submission, as things then stood, and as held at first instance, the words are plain, to use a term of art in this area, and the parties did not argue the matter either as to admissibility of evidence or as to doctrine at trial on the basis of ambiguity.  In the Court of Appeal, I need to make clear, my learned friend did assert ambiguity, but not, he there being an appellant, not so as to say his Honour was wrong in his recording of the parties’ stance below, let alone his Honour was wrong in evidentiary rulings that may or may not have turned on the existence of ambiguity.  There is irony here because there was objection successfully taken by our opponents at trial to extrinsic evidence. 

Now, in our submission, given that wording and given what is, in truth, the absence from any other express provisions of the instrument of anything that would detract from that plain meaning or force it to be read in otherwise than what we would call its ordinary sense, in our submission it is plain, as a matter of deductive reasoning, that something else has operated in the mind of the judges below.  That something else is described variously at its most anodyne commerciality at its closest to heresy to a judicial understanding of the operation of the markets in question. 

That is fact and, in our submission, when one then comes to the critical part of the reasoning, turning to page 152 of the application book, one can see how that has operated and why, with respect, it produces error.  In paragraph 68 Justice Allsop is embarked on an argument in relation to clause 4.2.  Clause 4.2 is one I do not need to read, but it suffices to say it provides for a certain commercial opportunity to be proposed, offered and taken. 

It would appear from a reading of paragraphs 68 and 69 on pages 152 and 153, particularly as it culminates on page 153 at about line 11 and following, that his Honour has in mind that there is something less than fair goes or even dealing produced by the argument we had under clause 4.1 and that which was available under clause 4.2, to which the short answer is, so what?  That had nothing to do with the function of the court in construing the request provision. 

Now, when one comes to paragraph 69 one sees from its second sentence on that his Honour is taking into account something which is not, as it were, theoretical or inherent, but something which is factual, something which could have been the subject of evidence had, for example, ambiguity been contended for successfully and extrinsic evidence successfully tendered rather than rejected.  But the point is ‑ ‑ ‑

HAYNE J:   Extrinsic evidence of what?

MR WALKER:   It would be in fact there is evidence that there was – which came in for another purpose in relation to the damages quantification, which is post contract, that there was not an active spot market at the time the contract was made.  What one sees in paragraph 69 in particular about line 52 or thereabouts is that his Honour is supposing, as a factual setting, against which he is reaching a conclusion, contrary, it can be observed, to an argument which he acknowledged started with something logically correct, see page 153, line 29, that is material in paragraph 69 which provides the footing for an argument which tries to equilibrate possible benefits under 4.1(d) and possible benefits under 4.2, all by reference to the commercial considerations that may impel self‑interested parties, having dealt at arm’s length, to look at prices from time to time and make decisions about their options.  None of that, in our ‑ ‑ ‑

HAYNE J:   Is it any more than that this related to a basic commodity, the price of which was not fixed?

MR WALKER:   Your Honour, it is more than that, but even if it were just that it would still be an illegitimate form of reasoning to drive the result contrary to the plain meaning.  That this is a commodity that is ‑ ‑ ‑

HAYNE J:   What, the court is meant to shut its eyes to the subject matter of the contract?  Come, come, surely not.

MR WALKER:   Surely not, and we in fact, in both courts below, took a leave, with respect, in putting this in a commercial context, but what we did not do, what was not done, and what should not be done in paragraph 69, is to refer to a scale or frequency or the possibilities of fluctuations in an market as if that pulls in its train a disapproval of a possible commercial advantage to my client or correlative disadvantage to the other side in what is after all a trading relationship. 

That, in our submission, is to rewrite or seek to restrike a commercial balance which is created by, and then requires as a matter of law to be governed by, the words chosen by the parties.  It is for those reasons, in our submission, when one sees the way in which his Honour had framed the applicable principle that there is a special leave point presented.  May I take your Honours, please, back to page 123 of the application book in paragraph 13 where the first sentence at line 29 records, in effect, what I have just put to Justice Hayne:

Each side brought to its argument the aid and buttressing of commercial good sense and commercial purpose.

It has to be said it would have been surprising if that were not so.  Then his Honour refers to a passage in Franklins v Metcash that starts at paragraph [19] and your Honours will recall that that passage in Franklins v Metcash immediately follows a section of those reasons in which his Honour in 2009 had referred to a controversy concerning the continued effect and authority of the famous passage in Codelfa at 352 starting “The true rule is”. 

Now, in paragraph 18 of Metcash, it starts at 76 NSWLR 617 and goes to the top of 618, one sees neatly put by the President the reference to Codelfa at 350 and 351 and not 352, and a statement there:

The issue is therefore not one for resolution otherwise than by application of current High Court authority -

which of course has been cited by his Honour culminating in that -and not 352 - passage.  There is a tension according to the President’s reasoning in 2009, see page 617 of Franklins, paragraph 17, between various parts, it is said, of the reasons of Sir Anthony Mason in Codelfa.  Now, by the time his Honour made the reference in paragraph 13 in this case to the Franklins v Metcash passage starting at 19, which builds on the preceding passages, being paragraphs 14 to 18, and calls them in aid, then, in our submission, it is clear that there has been a radical departure from the position that this Court, in refusing special leave from the Court of Appeal in Jireh, made as clear as could be imagined. 

So that the state of authority which is purportedly discerned in paragraph 13 in this 2013 decision by reference to the 2009 statements which contain that which is simply cannot stand in the face of the special leave refused comments in Jireh, is that which, in our submission, shows that the intervention of this Court as a matter of the discipline to be observed in relation to comments of this Court, albeit, in dismissing special leave, in relation to that very famous passage starting, “The true rule is”. 

Now, none of that would matter if this a case in which it could be said the outcome flows from an understanding of the words giving appropriate weight to the fact that they are words used not in a vacuum but in an understood commercial context and they are of course in relation to a commodity subject to a market and one may also put, in relation to freight costs subject to a market. 

But, what we can say, looking at the plain words in this case, is that something else must have operated because they do not permit linguistically, commercially of any other than the result with which we succeeded at first instance.  They do not permit of the notion that the seller was entitled to weigh up for itself whether it would comply with the request and whether it would therefore derive more than the stipulated rate that was produced by observing what the clause provided for, namely dead freight. 

It is for those reasons, in our submission, that this is a case, the facts of which are clear, commercially of a kind, that is options to parties in longstanding arrangements where there is an order from – order to order and circumstantial flexibility devised by the parties that is very commercial and very likely to occur for a very long time to come. 

The controversy about the meaning of the passage in Codelfa at 352 is of longstanding.  It is more than academic.  It does determine vitally the course of trial, the cost, expense and length of trial and, in our submission, this is a case which provides an opportunity first to vindicate the authority of this Court’s admonition in refusing special leave in Jireh that that passage at 352 is to be followed unless and until this Court says otherwise. 

That passage has not been followed in this case because if it had the Court of Appeal would need to have given attention to whether there was an ambiguity notwithstanding the common ground of the parties at first instance recorded by the learned trial judge that there had not been an ambiguity.  If it please the Court.

HAYNE J:   Thank you, Mr Walker.  Yes, Mr Hutley.

MR HUTLEY:   Your Honour, three issues are raised, what might be called the clause 4.1(d) point, the surrounding circumstances point and the iron ore market point.  The real crux of the debate in the case was the interrelationship between clause 4.1(d) and the balance of the rest of the contract in assisting in its construction.  That is what the case was fought about, and we say a wholly conventional approach was taken to it.

Can I come back to that after I have dealt with the second point, that is the contention of BlueScope based apparently on one sentence, which is at application book 238, 19, which I must take your Honours to, that it was common ground that this clause 4.1(d) was incapable of having more than one meaning, and that apparently is the passage:

Neither of you are asserting that this agreement is ambiguous or infelicitous.  Neither of you are claiming any equity of rectification.

Now, it was never the case, and was never understood by his Honour that the parties were not contending for differing meanings of clause 4.1(d).  The whole case was about that.  His Honour certainly was not saying there cannot be any surrounding circumstances evidence going to that question of construction.  His Honour certainly was not saying that because on the very same page of transcript at point 5, line 5, your Honours will see that:

one can look at that, that’s an objectively ascertainable fact that was known to both parties.

That is a reference to a prior agreement and the terms of the prior agreement and the fact that the prior agreement was not a deed, and an argument was advanced that you had to have understood this agreement, the deed was chosen because there was a concern that no consideration was being afforded by one of the parties because they had a complete option to go forward or not.  So, in other words, there was no doubt in the case and his Honour allowed surrounding circumstances evidence as bearing upon.  That is made also pellucidly clear by lines 37 to 40 on that very same page.  It says:

this is their negotiations as to what they intend to do, but nobody is suggesting that the agreement doesn’t achieve what the parties intended it to achieve and no one is suggesting that the words in the agreement have a meaning other than the words, the ordinary meaning they bear in the context of the transaction, to be gathered from the purpose of the transaction.

Now, what was happening, in fact surrounding circumstances evidence was relied upon by OneSteel and referred to by the trial judge at application book 31, paragraph 100, and your Honours will see that that is referred to, and the last sentence:

It put that, to the knowledge of both parties, the Dead Freight Rate under the Deed was higher than OneSteel’s freight costs -

That was a surrounding circumstance, namely, that the Iron Chieftain was on a long‑term charter party and the dead freight was less than that circumstance, again another surrounding circumstance to which party.  In fact, the applicants invited his Honour to have regard to surrounding circumstances for the purposes of this construction and your Honours will see that at application book 232, where they invite his Honour – it says:

To the extent it is necessary or appropriate to go to extrinsic material in order to understand the purpose, genesis or objective of the transactions or to rebut any argument as to the uncommerciality of the proper construction of the Deed, the following facts could be taken into account –

There were a whole series of surrounding circumstances.  I will make a point later on that if your Honours read all those, your Honours will see no reference to the stability of the iron ore price which is an invention – I mean that in the forensic sense – which is advanced for the first time on appeal and it was common ground that the price could vary in the way his Honour – and it was common ground for good evidentiary reasons which I will take your Honours to. 

Now, what his Honour was considering in the transcript at 238 was a wholly different type of evidence which was being sought to be tendered by my learned friend, Mr Gleeson.  His Honour was concerned with, as appears at 238, 19, the use that could be made of conversations and documents said to reflect the parties’ views as to the meaning of the proposed contract.  Now, that is clear from what appears at 239 between lines 5 and 15 when Mr Gleeson, as it were, put forward his best – what he was trying to get, and what he says:

Could I just offer your Honour this:  Your Honour sees the words “for any reason” and we rely upon those –

This is in a conversation –

as indicating request for any reason.  What is said is, whatever be the occasion, this is something that you can achieve –

These were negotiations about this clause –

provided you meet the two mandatory obligations –

The two that are referred to, the subclauses –

And the conversation in paragraph 92 explains the origin of that concept.

Then his Honour says, “That’s exactly what I can’t get involved in.  I can’t get involved in effect contentious conversations about the genesis of a particular clause in the contract”.  So whatever his Honour was saying in those two lines, his Honour never excluded evidence of mutually known background facts, never suggested that they could not be had regard to.  But his Honour was clearly dealing with competing contentions as to available open meanings in relation to this clause.

Now, the Court of Appeal, as my learned friend concedes – we submitted the agreement was capable of more than one meaning.  It is clear that the court agreed with that.  That appears at application book 149, paragraph 62.  They say clearly that there are arguments going each way as to the meaning of this clause.  A better expression of ambiguity, in our respectful submission, one cannot find. 

Now, BlueScope made no submission in the Court of Appeal that that was in any way contrary - our submission as to ambiguity - to the case that had been conducted because to do so, in our respectful submission, would have been quite wrong.  Whilst the trial judge found that clause 4.1(d) had a plain meaning – that is at application book 32, paragraph 103, your Honours – it is quite clear that fundamental to that view was his view that there was no incongruence between clause 4.1(d) and the balance of the contract.  That appears at application book 33, paragraph 111.

Thus we submit that the case was conducted by both parties on the basis that regard could be had to the materials which Codelfa says one can have regard to in circumstances of ambiguity or possible two meanings, which was clearly the case here.  The ambiguity of the contract was patent.  Clause 4.1(d)’s meaning had to be accommodated to the contract as a whole.  The trial judge in the court disagreed as to how that could be done.  The case is not a vehicle thus to consider the true rule to material relevant to the construction of the contract for two reasons.  The contract is clearly ambiguous and capable of two meanings in the relevant sense, and the parties conducted the pace at all times on the basis that the court would have regard to surrounding circumstances evidence because of that fact.

Now, returning if I can to the first issue about clause 4.1(d), can I take your Honours to it?  It is at application book 59, line 25.  Clause 4.1(d) commences with the words “If the seller has scheduled”, et cetera, “Shipments”.  At the outset, to understand 4.1(d) one needs to understand what was meant by that concept in the context of this contract.  Now, that took one to 12.3 immediately, and 12.3 is a complex clause about a complex ongoing relationship and the scheduling is a complex idea.

Your Honours will see from clause 12.3.1 the perhaps self‑evident proposition from the point of view of shipping that volume carried and time are intimately connected.  Your schedule from a timing point of view is intimately connected about how much iron ore you are putting on and you are putting off.  So there is no distinction between, as it were, when you are departing and how much you are carrying.  They are intimately connected.  The scheduling is a process of ongoing liaising, that is, people saying they want things, people saying they do not want things.  That has appeared from 12.3.2.

If your Honours go to 12.3.5 that explains what the nature of this schedule is.  It is in effect a rolling three‑month schedule which is supplied fortnightly, which can vary as to quantity and as to dates and times of arrival and departure over that period.  Now, 12.3.6, to which my learned friend took your Honours, in the first sentence deals with “ballast voyage”, but it is the second sentence which, with respect, he jumped over, which is utterly vital:

However, if the Buyer requests –

Note the word “requests” –

a change to a schedule that has been established in accordance with Clause 12.3.5, and the Seller agrees to that change –

et cetera.  Now, the notion of a schedule in this agreement was something wholly at the end of the day within the control of the seller but able to be the subject of requests by the buyer as to how to deal with it.  But those requests could have no binding effect upon the seller.  Now, if one goes back against that background to 4.1(d) at application book 59 – and I dealt with the first line – you then get to the second line:

and the Buyer requests . . . for any reason –

that is, upon any circumstance for any reason at any time.  So once the schedule is struck, if a request is made for any reason, the buyer can request for any reason and then certain things happen.

Immediately, a question arises – what is the seller obliged to do if it gets a request?  My learned friend says it is easy.  They are obliged to not load.  That is the obligation.  They are obliged to stop, not proceed with the scheduled loading.  That is not stated there.  There is, on any view, an ellipsis in the contract and the question was what was the answer to that ellipsis?  As we have said, having regard to the clear reference to clause 12.3, was it acceptance or, as they maintained, implied an absolute obligation to load?  That was the question of construction called for before the Court of Appeal.  That was the ambiguity which everybody was debating about at first instance here.

The Court of Appeal turned to this question about scheduling and considered there was a conflict.  Your Honours will find that in the judgment at paragraph 80, which your Honours will find at 157 of the application book, and in 81, and if your Honours would also look at 84.  The court, as it were, was seized upon and considered this question of conflict, they having earlier, between 78 and 79, gone through a detailed consideration of the scheduling provision in a way which we understand calls for no criticism, in a wholly conventional way.  Thus, there was, on BlueScope’s construction of 4.1(d), a patent conflict between 4.1(d) and 12.3.6 on any view.

But that was not all that the Court of Appeal had regard to.  Other clauses, for example, were rendered wholly superfluous if our learned friend’s arguments were right.  If your Honours go to paragraph 99, your Honours will see that clause 14.2(a), which is set out at 98 – it is page 165, if your Honours please – was rendered wholly superfluous if the BlueScope construction was correct. 

There are other oddities of this, for example, if your Honours go to 101.  There was a termination clause, which is set out in 100, which preserved rights to decline to take carriage under certain clauses - clauses 6, 13 and 14.  Your Honours will see that at the bottom of paragraph 100, clause 15.1.

There was a striking oddity, if our learned friend’s construction was correct, that, as it were, the most common likely to be availed of right clause on their construction was not referred to as having been preserved in clause 15.  None of these were determinative by their Honours, but their Honours in effect from 102 and following went through a wholly conventional process of construction weighing these, considering them and came to the conclusion they came to in a way which is wholly unexceptionable and, in our respectful submission, clearly right.

Thus, we say, the Codelfa question, if I can call it that will not arise and there is no information which was excluded or included improperly.  The process they went through was wholly conventional, and they are right.  But the third issue is the iron ore price.  As to the point concerning the iron ore, it is hardly surprising that the arguments proceeded on the basis it was a market commodity and could fluctuate. 

We have set out in our written submissions at application book 241 to 242 in paragraph 8 the references to the transcript in the Court of Appeal where, on questions of construction, both parties deployed the character of the subject matter of this contract as a freely tradable and market price dependent commodity to deploy in support of their arguments.

Your Honours, perhaps a good example on behalf of BlueScope is at 256, lines 40 to 45, and 257, lines 1 to 18.  I will not read them to your Honours, but if your Honours cast your eyes over them.  My learned friend, Mr Dick, was conducting the argument, and quite properly he was seeking to deploy those debates for construction questions.

The evidence of Mr Jansen made such an argument almost inevitable.  If your Honours go to 216, paragraphs 34 and 45, your Honours will see the material which is said in our learned friend – I am sorry, 35 and 36, I do apologise.  It is to be remembered that this contract was executed on 30 December 2004.  It says:

Prior to 2004, there was a very small spot market for iron ore.  Most iron ore was sold on a long term contract basis and priced by reference to the annual published benchmarked price.  In or around 2004, a change began to occur –

et cetera, and then it goes on.  So, in effect, these are highly sophisticated parties and they were executing the contract at the very moment that there was, what we now know, the revolution which was occurring.  It is hardly surprising in that context that the Court of Appeal took the approach they did at paragraph 69, to which my learned friend has taken your Honours and I will not go to it, and their approach in that regard was wholly correct, in our respectful submission.  It says – I will go to it, since I am there:

This last consideration is of some importance.  One plain and obvious aspect . . . was the variability of the price . . . Although the evidence revealed that the spot market in iron ore began to be active only from 2004, nevertheless –

et cetera.  Their Honours went straight to the crux of it.  It was obviously material and the usage of it was wholly conventional, having regard to the patent ambiguity of this contract and the way the parties conducted the case.  In our respectful submission, special leave should be refused.

HAYNE J:   Thank you, Mr Hutley.  Yes, Mr Walker.

MR WALKER:   Your Honours, the material that my learned friend noted at application book 232 is material that was objected to successfully, that is, it was rejected at trial.  That comes from a transcript page that somehow did not make the application book, but it is transcript 35.  It was not a stray line only in transcript arguendo that noted Justice Hammerschlag’s position about ambiguity attributed to the parties.  It is also in the application book, page 33, paragraph 111 in his Honour’s reasons.

In relation to ambiguity, it cannot truly be that the fact that there are adversaries in litigation vying for different outcomes as to the meaning of a contract supplies the content of a supposed test of ambiguity or susceptibility to more than one meaning.  That would be to suggest that many distinguished jurisprudes have simply failed to understand that these matters nearly always come to be fought in what is a fight where people have different positions.

In relation to clause 12.3.6, the second sentence is not one we are frightened to alight upon.  In our submission, it could not on a plain reading possibly occur that that would affect the operation of 4.1(d)(i).  The requirement in relation to payment and the difference in relation to scheduling is manifest.

There is no ellipsis problem in 4.1(d).  That is, there is no problem of a kind that ever needed resort to anything other than what might be called obvious common sense.  It was never suggested that in response to a request not to load upon which there shall be payment of dead freight, it was never suggested that one could nonetheless turn up and insist on thrusting unwanted iron ore finds on the wharf, notwithstanding all you would be paid is dead freight.  That is too silly for words, and there was no ellipsis that caused any problem.  It was an ellipsis of common sense between commercial parties and it plays no part in the textual understanding of the obligations.

In relation to clause 14.2 – another part of the deed which in accordance with orthodox approach should be taken into account, my friend says, well, of course, all parts of the instrument need to be taken into account, but if you look at clause 14.2, that is declining to accept for an important reason chemical properties, compliance and effect with public law in terms of pollution control.  Furthermore, persisted in, under certain circumstances, it produces a right of termination.  It is a quite critically different clause.  It is not, as was reasoned in the Court of Appeal, paragraphs 98 and more importantly 103, it is simply not a matter which our interpretation of 4.1(d) subsumes.  It is a careful working out of a specific regime with a quite different possible outcome of termination.

In our submission, what has happened in this case is that there has been a judicial review of commerciality informed by what I will call views about the availability of spot market, and what might be called opportunistic, self‑interested dealing of a kind which has inappropriately resulted in the court substituting on that unsafe basis its commercial judgment as to what is right or good or proper or appropriate for what is clearly driven by the plain words of the text chosen by the parties to record their bargain.  That is what is contrary to the important policy foundations explained in, among other things, Sir Anthony Mason’s reasons in Codelfa.  May it please the Court.

HAYNE J:   Thank you, Mr Walker.

The dispute between the parties depended upon the proper construction of the particular sale and purchase deed they made.  In our opinion the applicant enjoys insufficient prospects of disturbing the actual orders made by the Court of Appeal to warrant a grant of special leave to appeal.  No disputable question of principle would conveniently fall for consideration if special leave to appeal were granted.  Special leave is refused with costs.

AT 12.32 PM THE MATTER WAS CONCLUDED