Bombardier Inc v Avwest Aircraft Pty Ltd

[2020] WASCA 2

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT  :   THE COURT OF APPEAL (WA)

CITATION:   BOMBARDIER INC -v- AVWEST AIRCRAFT PTY LTD [2020] WASCA 2

CORAM:   BUSS P

BEECH JA

PRITCHARD JA

HEARD:   12 APRIL 2019

DELIVERED          :   10 JANUARY 2020

FILE NO/S:   CACV 50 of 2018

BETWEEN:   BOMBARDIER INC

Appellant

AND

AVWEST AIRCRAFT PTY LTD

Respondent

ON APPEAL FROM:

Jurisdiction              :   SUPREME COURT OF WESTERN AUSTRALIA

Coram:   MASTER SANDERSON

Citation: AVWEST AIRCRAFT PTY LTD -v- BOMBARDIER INC [2018] WASC 139

File Number            :   CIV 2450 of 2017

Catchwords:

Practice and procedure - Application to set aside leave to issue writ outside of Australia - Whether primary court erred in refusing application - Arguable case - Construction of contracts - Whether good arguable case that clauses in the written agreements dispense with requirement to communicate acceptance of offer

Practice and procedure - Choice of jurisdiction - Whether this court a clearly inappropriate forum - Onus of proof on application to set aside grant of leave to issue and serve a writ outside of jurisdiction - Whether primary court applied erroneous test as to onus - Where key witnesses overseas and foreign law applies to written agreements

Legislation:

Property Law Act 1969 (WA)
Rules of the Supreme Court 1971 (WA)
Supreme Court Act 1935 (WA)

Result:

Leave to appeal refused
Appeal dismissed

Category:    B

Representation:

Counsel:

Appellant	:	Mr A C Willinge
Respondent	:	Mr N C Hutley SC & Ms J L Roy

Solicitors:

Appellant	:	Ashurst Australia
Respondent	:	Herbert Smith Freehills

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

Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552

AK Investment CJSC v Kyrgyz Mobil Tel Limited [2011] UKPC 7

Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99

AVWest Aircraft Pty Ltd v Bombardier Inc [2018] WASC 139

Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334

Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219

Brogden v Metropolitan Railway Co (1877) 2 App Cas 666

Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256

Crawley Investments Pty Ltd v Elman [2014] WASC 233

Dean and Westham Holdings Pty Ltd v Lloyd (1991) 3 WAR 235

DJE Constructions Pty Ltd v Maddocks [1982] 1 NSWLR 5

Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12; (2017) 261 CLR 544

Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640

Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523

Fitness First Australia Pty Ltd v Fenshaw Pty Ltd [2016] NSWCA 207; (2016) 92 NSWLR 128

Kelbush Pty Ltd v Australia and New Zealand Banking Group Ltd [2016] WASCA 14; (2016) 49 WAR 374

Latec Finance Pty Ltd v Knight [1969] 2 NSWR 79

Maggbury Pty Ltd v Hafele Australia Pty Ltd [2001] HCA 70; (2001) 210 CLR 181

Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104

Neilson v Overseas Projects Corporation of Victoria Ltd (2005) 223 CLR 331

Netglory Pty Ltd v Caratti [2013] WASC 364

Nurisvan Investment Limited v Anyoption Holdings Limited (2017) VSCA 141

Oceanic Sun Line Special Shipping Co Inc v Fay [1988] HCA 32; (1988) 165 CLR 197

Perre v Apand Pty Ltd [1999] HCA 36; (1999) 198 CLR 180

Regie Nationale des Usines Renault SA & Anor v Zhang [2002] HCA 10; (2002) 210 CLR 491

Robophone Facilities Ltd v Blank [1966] 3 All ER 128

Secured Income Real Estate (Australia) Ltd v St Martins Pty Ltd (1979) 144 CLR 596

Simic v New South Wales Land and Housing Corporation [2016] HCA 47; (2016) 260 CLR 85

Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80

Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1

Tiger Yacht Management Ltd v Morris [2019] FCAFC 8

Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538

VTB Capital plc v Nutritek International Corp [2013] UKSC 5; [2013] 2 AC 337

Westgyp Pty Ltd v Northline Ceilings Pty Ltd [No 2] [2019] WASCA 145

Westraint Resources v BHP Iron Ore Pty Ltd [No 5] [2010] WASC 62

Wilkie v Gordian Runoff Ltd [2005] HCA 17; (2005) 221 CLR 522

Wilson v Metaxas [1989] WAR 285

Zaghloul v Woodside Energy Ltd & Ors [2019] WASCA 187

Zhu v Treasurer of the State of New South Wales [2004] HCA 56; (2004) 218 CLR 530

JUDGMENT OF THE COURT:

1. Bombardier Inc (Bombardier) is a manufacturer of aircraft and rail equipment.  Amongst other things, Bombardier produces, fits out, certifies and markets aircraft.  AVWest Aircraft Pty Ltd (AVW) has a business involving the purchase of aircraft produced by Bombardier for resale to third party buyers. 

2. Between 2009 and 2015, AVW and Bombardier engaged in extensive commercial dealings for the purchase of aircraft.  The contractual arrangements between them were, broadly, that AVW made large up‑front payments of cash to Bombardier, and Bombardier sold aircraft to AVW on generous terms, undertook to find third party buyers for the aircraft and to facilitate the sale of aircraft by AVW to those buyers. Bombardier would then pay AVW net profits and other amounts paid by AVW to Bombardier on account of the purchase price for the aircraft. 

3. A dispute arose between AVW and Bombardier, in which AVW contended that Bombardier had refused to perform its contractual obligations arising out of 12 written agreements (written agreements) and three alleged oral agreements between them (alleged oral agreements). 

4. AVW wished to bring proceedings against Bombardier in the Supreme Court of Western Australia, to obtain declaratory relief and damages for breach of those agreements. 

5. AVW's registered office is in Perth.  At all relevant times its directors have resided, and been located, in Perth.[1]  AVW's registered office and its principal place of business are, and have always been, in Western Australia.  Bombardier is listed on the Toronto stock exchange.  Its headquarters are in Quebec and all of its business operations are conducted in Canada.  Consequently, under the Rules of the Supreme Court 1971 (WA) (RSC), AVW required leave to issue a writ of summons against Bombardier, and to serve the writ outside Australia.[2] 

   [1] Affidavit of Timothy Andrew Roberts sworn 22 August 2017 [8] - [9], Green Appeal Book (GAB) 85.

   [2] RSC O 10 r 1, r 4.

6. AVW applied for orders for leave to issue the writ against Bombardier, and to serve the writ out of the jurisdiction.  Leave to file the writ and serve it outside the jurisdiction was granted by the learned master.[3]  Service of the writ, which was endorsed with a Statement of Claim,[4] was effected on Bombardier at its corporate headquarters in Quebec.

   [3] Blue Appeal Book (BAB) 15.

   [4] BAB 56.

7. Bombardier filed and served a conditional appearance denying the jurisdiction of the Supreme Court of Western Australia to deal with the matters set out in the writ.[5] 

   [5] RSC O 12 r 6(1).

8. Bombardier also applied for orders setting aside the grant of leave to issue and serve the writ, and the service of the writ, on it (Application).[6]  The learned master dismissed the Application (Primary Decision)[7] and made orders that the Application be dismissed, that Bombardier's conditional appearance remain conditional until the later of either the expiry of the appeal period in respect of the learned master's decision or the final determination of any appeal, and that costs be reserved until the appearance became unconditional or the determination of any appeal (Orders).[8]

   [6] BAB 91.

   [7] AVWest Aircraft Pty Ltd v Bombardier Inc [2018] WASC 139, BAB 2.

   [8] BAB 1.

9. Bombardier appeals to this court against the Orders.  It requires leave to do so.[9]

   [9] Supreme Court Act 1935 (WA) s 60(1)(f). Murphy JA ordered that the application for leave to appeal be referred to the hearing of the appeal: White Appeal Book (WAB) 3.

10. AVW filed a Notice of Contention, in which it contended that the Primary Decision could also be upheld on a basis different from that relied on by the learned master.

11. For the reasons which follow, we would refuse leave to appeal, and dismiss the appeal.  It is unnecessary to deal with the Notice of Contention.

Principles governing the grant of leave to issue a writ and to serve it out of Australia

1. A writ for service outside Australia is not to be issued without the leave of the court.[10] 

   [10] RSC O 5 r 9.

2. In addition, a writ issued out of the court and served on a person outside Australia has no effect unless the court, under O 10 of the RSC, granted leave to serve the person, and the person was served in compliance with the requirements of the RSC.[11]  An application for leave must be supported by an affidavit that states that the deponent believes that the plaintiff has a good cause of action, and states where, outside Australia, the person to be served is, or probably may be.[12] 

   [11] RSC O 10 r 1A(2).

   [12] RSC O 10 r 4(1).

3. Under O 10 r 1(1) RSC, two requirements must be met before the court will grant leave to serve a person outside Australia with a writ.[13] First, the plaintiff's case must fall within one of the categories - sometimes called the 'pigeonholes' or jurisdictional conditions - set out in O 10 r 1(1). Secondly, the court must be persuaded to exercise its discretion in favour of the grant of leave: leave is not to be granted unless it is made sufficiently apparent to the court that the case is a proper one for service outside of the jurisdiction.[14]

   [13] Crawley Investments Pty Ltd v Elman [2014] WASC 233 [45(2)] (Edelman J).

   [14] RSC O 10 r 4(2).

4. One of the 'pigeonholes' in O 10 r 1(1) (and the only one relied on in this case) is that:

   (e) the action is one brought to enforce, rescind, dissolve, annul, or otherwise affect a contract, or to recover damages or obtain other relief in respect of the breach of a contract, being in either case a contract -

   (i)made within the jurisdiction; or

   (ii)made by or through an agent trading or residing within the jurisdiction on behalf of a principal trading or residing out of the jurisdiction; or

   (iii)which by its terms or implications is governed by the law of Western Australia.

5. There was no dispute that in order to determine whether a case falls within one of the pigeonholes in O 10 r 1(1) RSC, the plaintiff must demonstrate that there is a 'good arguable case' that the matter falls within a pigeonhole.[15]

   [15] Appellant's Amended written submissions [5], WAB 9; Crawley Investments Pty Ltd v Elman [45(3)] (Edelman J).

6. The court should not grant leave unless it is positively satisfied that it should do so.  It should not be so persuaded unless the plaintiff satisfies it that the case falls within one of the pigeonholes and that the proceedings would not be subsequently stayed as an abuse of process on forum non conveniens (that is, inappropriate forum) grounds or for some other reason[16] (for example, that the proceedings are liable to be struck out summarily[17]).

   [16] Voth v Manildra Flour Mills Pty Ltd [1990] HCA 55; (1990) 171 CLR 538, 564 (Mason CJ, Deane, Dawson & Gaudron JJ).

   [17] cf Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552 [55] (Gaudron, McHugh, Gummow & Hayne JJ); and see Crawley Investments Pty Ltd v Elman [45(5)] (Edelman J).

7. In relation to the inappropriate forum issue, the question is whether the local court is a clearly inappropriate forum for the determination of the dispute, having regard to all of the circumstances of the case.[18]  A court will be a clearly inappropriate forum if the continuation of the proceedings in that court would be oppressive, in the sense of seriously and unfairly burdensome, prejudicial or damaging, or vexatious, in the sense that it would cause serious and unjustified trouble and harassment.[19] 

   [18] Oceanic Sun Line Special Shipping Co Inc v Fay [1988] HCA 32; (1988) 165 CLR 197, 248 (Deane J); Voth v Manildra Flour Mills Pty Ltd (564 - 565); Regie Nationale des Usines Renault SA & Anor v Zhang [2002] HCA 10; (2002) 210 CLR 491 [25].

   [19] Oceanic Sun Line Special Shipping Co Inc v Fay (247) (Deane J); Voth v Manildra Flour Mills Pty Ltd (564 - 565) (Mason CJ, Deane, Dawson & Gaudron JJ); Regie Nationale des Usines Renault SA & Anor v Zhang [25] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ).

8. One circumstance which will always be relevant to the application of the clearly inappropriate forum test will be the availability of relief in a foreign court or tribunal.[20]  However, the question whether the local court is a clearly inappropriate forum does not turn 'upon an assessment of the comparative procedural or other claims of the foreign forum', or require the formation of subjective views about either the merits of that forum's legal system or the standards and impartiality of those who administer it.[21]  The question whether the local court is a clearly inappropriate forum focuses on the inappropriateness of the local court and not the appropriateness or comparative appropriateness of the suggested foreign forum.[22]  That is, a court is not a clearly inappropriate forum merely because another one is more appropriate.[23]

   [20] Oceanic Sun Line Special Shipping Co Inc v Fay (248) (Deane J).

   [21] Voth v Manildra Flour Mills Pty Ltd (558) (Mason CJ, Deane, Dawson & Gaudron JJ).

   [22] Voth v Manildra Flour Mills Pty Ltd (565) (Mason CJ, Deane, Dawson & Gaudron JJ).

   [23] Regie Nationale des Usines Renault SA & Anor v Zhang [24] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ).

9. Similarly, whether the substantive law of the forum is applicable in the determination of the dispute which is the subject of the action is a significant factor in the exercise of the discretion to set aside service outside the jurisdiction, but it is not determinative.[24]  An Australian court cannot be a clearly inappropriate forum merely by virtue of the circumstance that the choice of law rules which apply in the forum require its courts to apply foreign law as the law governing the determination of the dispute.[25]

   [24] Voth v Manildra Flour Mills Pty Ltd (566) (Mason CJ, Deane, Dawson & Gaudron JJ); Regie Nationale des Usines Renault SA & Anor v Zhang [26].

   [25] Regie Nationale des Usines Renault SA & Anor v Zhang [81] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ).

10. Any legitimate personal or juridical advantage is also a relevant, but not decisive, consideration in determining whether the local court is a clearly inappropriate forum.[26]

    [26] Voth v Manildra Flour Mills Pty Ltd (564 - 565) (Mason CJ, Deane, Dawson & Gaudron JJ); Regie Nationale des Usines Renault SA & Anor v Zhang [25] (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ).

11. The determination of whether the local court is not a clearly inappropriate forum, in the sense of determining whether a trial in the local jurisdiction would not be productive of injustice, involves an evaluative judgment. The role of the primary judge in considering whether the local court is a clearly inappropriate jurisdiction is thus not merely to weigh all the factors, but to make a judgment as to whether a trial in the jurisdiction would be productive of injustice, in the sense described above at [18].

Factual background

1. It is unnecessary to set out in much detail the factual background concerning the parties' commercial dealings.  Between April 2009 and September 2015, AVW purchased 67 new and used aircraft from Bombardier.  They were usually purchased in batches of four or more aircraft.  Fifty eight of those aircraft were then sold to third party buyers.  The total payments involved, and AVW's net profit, amounted to many millions of dollars. 

2. The structure of purchases, by AVW, of the aircraft from Bombardier, and their resale to third party buyers, followed the same pattern.  AVW purchased aircraft from Bombardier for a negotiated price, under an aircraft purchase agreement.  When a third party buyer was found, that aircraft purchase agreement was terminated by a written agreement, which was set out in the form of a termination deed.  The termination deed set out payments which Bombardier would make to AVW (repaying monies paid under the original aircraft purchase agreement, and the net profit made on the sale to the third party buyer).  Bombardier would then enter into a replacement aircraft purchase agreement with the third party buyer which set out the new price and payment terms.[27]

   [27] Affidavit of Robert James Horner sworn 23 January 2018 [28], GAB 797.

3. Seven of the 12 written agreements the subject of the present proceedings were termination deeds (Termination Deeds), and four were aircraft purchase agreements (Aircraft Purchase Agreements).  Each of these pertained to a single aircraft.[28]  The final agreement (Amendment Agreement) amended and restated an earlier Amended and Restated Aircraft Purchase Agreement, which was effective 31 January 2011, and superseded that earlier agreement.[29]   

   [28] Copies of each of the written agreements were annexed to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 469.

   [29] Annexure ACSC-2 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 478.

4. Bombardier accepted that the written agreements were validly made, and there was no dispute as to the facts governing how the written agreements were made. 

5. It is not necessary to outline the totality of the terms of the written agreements.  At this point it suffices to set out the terms of the key clauses in the written agreements which were the subject of this appeal.

6. Each of the seven Termination Deeds[30] contained a clause in the following terms:

   This Deed is made between BOMBARDIER INC (Seller) and AVWEST AIRCRAFT PTY LTD ACN 129 279 072 as trustee of AVWEST AIRCRAFT TRUST established under a Trust Deed dated 18 January 2008 (AVWest) and shall be effective as of the date of its acceptance and execution by the Seller.[31]  (emphasis added)

   [30] Annexures ACSC-1, ACSC-6, ACSC-7, ACSC-8, ACSC-9, ACSC-17 and ACSC-20 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 469.

   [31] See, eg, annexure ACSC-1 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 475.

7. For convenience, we will refer to this clause as the 'Deed acceptance and execution clause'.

8. Four of the remaining written agreements[32] contained a clause which was in the following terms:

   This Aircraft Purchase Agreement is made by and between BOMBARDIER INC (Seller) and AVWEST AIRCRAFT PTY LTD ACN 129 279 072 as trustee of AVWEST AIRCRAFT TRUST established under a Trust Deed dated 18 January 2008 (Buyer) and shall be effective as of the date of its acceptance and execution by Seller.[33] (emphasis added)

   [32] Annexures ACSC-5, ACSC-10, ACSC-16 and ACSC-18 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 469.

   [33] See, eg, annexure ACSC-5 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 475.

9. For convenience, we will refer to this clause as the 'Agreement acceptance and execution clause'.

10. Finally, the Amendment Agreement contained a clause in the following terms:

    This agreement ('Agreement') amends and restates Amended and Restated Aircraft Purchase Agreement G170-0132 effective 31 January 2011 ('Previous Agreement') between BOMBARDIER INC ('Seller') and AVWEST AIRCRAFT PTY LTD ACN 129 279 072 as trustee of AVWEST AIRCRAFT TRUST established under a Trust Deed dated 18 January 2008 ('Buyer').  This Agreement is made on the date of its acceptance and execution by [the] Seller, to replace and supersede the Previous Agreement in its entirety, and to have effect and govern the contractual relationship between the parties on and from 29 June 2012.[34]  (emphasis added)

    [34] Annexure ACSC-2 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 478.

11. For convenience we will refer to this clause as the 'Amendment Agreement acceptance and execution clause'.

12. In these reasons, we refer to the Deed acceptance and execution clause, the Agreement acceptance and execution clause, and the Amendment Agreement acceptance and execution clause, collectively, as the subject clauses.

1. AVW contended that the parties signed standard form agreements in relation to each transaction for the purchase of aircraft, but also reached oral agreements on related matters, including the relations between and among the various transactions, and which were thus described as 'oral master agreements'.  One of those alleged oral agreements was referred to as a 'minimum net returns agreement' while the other was referred to as the 'rolling 7000 purchase agreement'.  In addition, AVW contended that there was an oral agreement for Bombardier's re-purchase of a Global 7000 aircraft, on terms previously agreed, in the event that a sale to a specified third party did not proceed.  That alleged oral agreement was referred to as the '7000 4 repurchase agreement'.

2. Bombardier ultimately intends to deny the existence of the alleged oral agreements,[35] but for the purposes of its application to set aside the grant of leave to issue and serve the writ outside of Australia, Bombardier accepted that the alleged oral agreements were entered into. 

   [35] Affidavit of David Nemes sworn 19 February 2018 [10], GAB 807.

3. Having regard to the issues raised by the Application, and by the grounds of appeal, it is unnecessary to set out the nature of the matters pleaded in the statement of claim filed by AVW and served with the writ.  It is, however, appropriate to note that in relation to each of the written agreements, AVW pleaded that each of the Aircraft Purchase Agreements, the Amendment Agreement, and the Termination Deeds, was made in Western Australia, because in each case, the last act by which the agreement was concluded occurred in Western Australia, in that: AVW made an offer to enter into the relevant agreement by sending to Bombardier, in Canada, by email, a copy of such an agreement executed by AVW; Bombardier communicated its acceptance of the offer by sending to AVW, by email, a copy of the agreement executed by Bombardier; and the email from Bombardier was received by AVW in Western Australia.[36]

   [36] Statement of Claim [54], [55] and [59].

4. Evidence in support of the latter pleading was set out in an affidavit filed by AVW in support of its application for leave to issue the writ and serve it outside Australia.[37]  There was no dispute that the evidence was that AVW would sign the agreement and send it electronically to Bombardier, which would execute it, and later send it back to AVW electronically.[38]

   [37] Affidavit of Timothy Andrew Roberts sworn 22 August 2017, GAB 1 - 78.

   [38] Appeal ts 18.

5. We have proceeded on the basis as, in effect, found by the master,[39] and accepted by Bombardier,[40] that in the case of each of the written agreements, AVW made an offer to enter into a contract with Bombardier in the terms set out in the copy of the agreement which AVW executed, and sent by email to Bombardier (AVW's offer).  In each case, AVW's offer was, in some manner, accepted by Bombardier.  It executed each document and emailed a copy of the signed document to AVW in Western Australia.  The manner in which acceptance occurred, and what act or acts constituted it, is the subject of ground 1 of the appeal.

   [39] Primary Decision [22].

   [40] Appeal ts 18.

Primary Decision

1. The Application to set aside the grant of leave to issue and serve the writ outside Australia was advanced on three bases. 

2. First, in relation to the written agreements, Bombardier contended that the matter did not fall within the pigeonhole in O 10 r 1(1)(e) RSC. AVW's case was that the matter fell within that pigeonhole because the written agreements were made in Western Australia. AVW contended that the practice employed by the parties in each case where the written agreements were entered into was that AVW would sign the agreement and send it to Bombardier in Canada. Bombardier would then sign the agreement and communicate its 'acceptance' to AVW by returning the signed agreement to it by email, which was received by AVW's personnel in Western Australia. AVW contended that on the application of common law principles governing the formation of contracts, pursuant to which a contract is made at the place where communication of the acceptance is received, each of the agreements was made in Western Australia.

3. Bombardier contended that the written agreements were not made in Western Australia, but rather were made in Canada, or elsewhere.  That argument proceeded on the basis that the common law permits parties to a contract to dispense with or modify the ordinary principle that a contract is made once acceptance of the offer is communicated to the offeror.  Bombardier contended that by the subject clauses, the parties had displaced the common law principles governing when and where a contract is made.  Its case was that the subject clauses provided that the act of execution by Bombardier was sufficient, without the need for any further act, to constitute acceptance of the agreement, with the result that the written agreements were not made in Western Australia.

4. The learned master rejected Bombardier's contention.  He concluded that:[41]

   the words of these two clauses are not sufficient to conclude with certainty that the general principle as to acceptance has been modified.  The clauses use the phrase 'effective as of the date of its acceptance and execution'.  That seems to me to require Bombardier to actually notify AVWest of the acceptance of the contract.  The point was made by counsel for AVWest that, unless acceptance was communicated to AVWest, there could be uncertainty as to whether or not the contract had actually been formed.  In that context, it is relevant to note that on each occasion AVWest was advised by email that Bombardier had completed the contract. That act appears to be 'a final and unqualified expression of assent to the terms of an offer'…   That being so, I am satisfied that there is a good arguable case that acceptance of the contracts was in Western Australia and this court has jurisdiction. (footnotes omitted)

   [41] Primary Decision [26].

5. The second argument advanced by Bombardier, which pertained to the alleged oral agreements, was directed to the exercise of the court's discretion to grant leave to serve the writ outside Australia.  Bombardier contended that the court should decline to exercise jurisdiction over the claims that were said to arise out of those agreements, on the basis that the alleged oral agreements were governed by the law of New York, and would be unenforceable under New York law.  It contended that two of the alleged oral agreements would be unenforceable because those agreements purported to modify the written agreements, which themselves contained 'no oral modification' and 'entire agreement' clauses, and were expressly governed by the law of New York, under which oral agreements to amend the written agreements would not be effective.[42]  Bombardier also contended that all three of the alleged oral agreements would be contrary to various provisions of the law of New York, namely the Statute of Frauds provisions in the Uniform Commercial Code of New York and the General Obligation Law.[43]

   [42] Primary Decision [9].

   [43] Primary Decision [28].

6. Although AVW accepted that the law of New York was the applicable law in relation to the written agreements, it did not accept that the law of New York governed the alleged oral agreements.  It submitted that a choice of law could be inferred from the terms of the contract and the surrounding circumstances, and that that determination required a factual investigation which could not be undertaken on a summary basis.[44] 

   [44] Primary Decision [29].

7. Further, AVW contended that the law of Western Australia was the system of law with which the transactions effected by the alleged oral agreements had their closest and real connection because: the agreements were concluded in Western Australia; the parties to the agreements were residents in Western Australia and Canada respectively and the agreements were made when AVW was situated in Western Australia; it was the party obliged to make payments under the minimum net return agreement and the rolling 7000 purchase agreement, and the party entitled to receive payments under the minimum net return agreement and benefits under the other alleged oral agreements, and it was a resident in Western Australia; and the alleged oral agreements were valid and enforceable under Western Australian law.[45]

   [45] Primary Decision [30].

8. The learned master noted that Bombardier made detailed submissions in response to each of these propositions.  However, the learned master focused on the submissions advanced by AVW 'because it is [AVW] that claims its position is arguable'.[46]  The learned master concluded that it was not appropriate to deal in detail with the matters raised because no certain finding could or should be made.  Rather, he concluded that having regard to AVW's submissions, it was 'arguable in relation to the oral contracts that the proper law is the law of Western Australia'.[47] 

   [46] Primary Decision [31].

   [47] Primary Decision [31].

9. However, the learned master concluded that even if the proper law in relation to the alleged oral agreements was the law of New York, he was satisfied that it was arguable that those agreements may be enforceable.  He noted that the parties each filed expert evidence as to the law of New York.  Although Bombardier contended that the Statute of Frauds provisions of the New York Uniform Commercial Code and the General Obligation Law were an absolute bar on the enforcement of oral agreements, the expert on whose opinion it relied accepted that there were a number of exceptions which permitted the enforcement of oral contracts governed by the law of New York.  The learned master concluded[48] that the application of these various exceptions:

   require[d] a detailed examination of the facts and, perhaps more importantly in this context, a full and complete understanding of the law of New York as it applies to those facts.  It is simply not possible in an interlocutory proceeding to conclude, based upon written expert evidence untested by cross examination, that [AVW's] position is hopeless.  There is no real prospect of summary judgment ever being available to a party in Bombardier's position were it bold enough to make such an application.

   [48] Primary Decision [33].

10. The third contention advanced by Bombardier in support of its Application was that in relation to the proceedings as a whole, the court should decline to exercise jurisdiction on the basis that the Supreme Court of Western Australia was a clearly inappropriate forum for the proceedings, having regard to the principles of forum non conveniens.[49]  The basis for that contention was that numerous witnesses, none of whom were in Western Australia, would have to give evidence, and that certain key individuals were no longer employed by Bombardier and were unable to be compelled to give evidence in the proceedings.[50] 

    [49] Primary Decision [10].

    [50] Primary Decision [34] - [35].

11. The learned master concluded[51] that there was no substance in Bombardier's complaint:

    Most of the evidence in this case will be of a documentary nature and which court hears the matter is not really a factor.  It is true that the relevant witnesses whom Bombardier may wish to call are based in Canada or at least out of the jurisdiction.  But, modern technology video links are possible and if there is any disadvantage it is in cross examining a witness on a video link and that disadvantage rests with [AVW].  Canada is a sophisticated jurisdiction and witnesses are as compellable in Australian courts as they are in Canadian courts with some added complications.  Both the Canadian court and this court would be confronted with the difficulty of interpreting New York law, but that in and of itself does not render this forum clearly inappropriate.

    [51] Primary Decision [36].

12. Consequently, the learned master was not satisfied that there was any basis for setting aside either the writ or the service of the writ.[52]

    [52] Primary Decision [37].

Leave to appeal

1. As the Orders the subject of the appeal are interlocutory in nature, Bombardier requires leave to appeal.[53]  Generally speaking, leave should not be granted unless the decision below is plainly wrong or is attended by sufficient doubt to justify the grant of leave and a substantial injustice would be done if the decision remains undisturbed.[54]

   [53] Supreme Court Act 1935 (WA) s 60(1)(f). See Zaghloul v Woodside Energy Ltd & Ors [2019] WASCA 187 [57] (Quinlan CJ, Murphy & Pritchard JJA).

   [54] Kelbush Pty Ltd v Australia and New Zealand Banking Group Ltd [2016] WASCA 14; (2016) 49 WAR 374 [81] (Mitchell J); Wilson v Metaxas [1989] WAR 285, 294 (Malcolm CJ, Brinsden & Smith JJ agreeing).

2. For the reasons set out below in relation to each of the grounds of appeal, we are not persuaded that the Primary Decision was plainly wrong or attended by sufficient doubt to justify the grant of leave, nor are we persuaded that a substantial injustice would be done if that decision remains undisturbed.  Leave to appeal should therefore be refused.

Grounds of Appeal

1. Bombardier advanced four grounds of appeal.  Effectively, these challenged the conclusions reached by the learned master in respect of the first and third contentions advanced by Bombardier on the Application.  Bombardier did not seek to challenge the learned master's findings on the second of its contentions, namely whether AVW had any reasonable prospect of succeeding in its claims in relation to the alleged oral agreements.

2. At the hearing before this court, counsel for Bombardier accepted that in order for Bombardier to succeed on the appeal, it needed to succeed either on one of ground 1 or 2, together with ground 3, or to succeed on ground 4,[55] of the grounds of appeal.  Later in the hearing counsel for Bombardier also accepted that ground 2 related only to the merits of one of the claims, and thus only to discretion, so that success on ground 2 would not give rise to the issue the subject of ground 3.[56]

   [55] Appeal ts 4.

   [56] Appeal ts 26 - 27, 55.

3. It is convenient to deal first with ground 2, then grounds 1, 4, and 3, and the Notice of Contention. 

Ground 2

1. In ground 2, the appellant contended, in summary:

   (a)In refusing to set aside the Orders, the learned master erred in law by failing to find, or alternatively failing to address the submission, that the declaration sought in Prayer (E) of the writ and statement of claim in relation to the matters described in [51] of the statement of claim is outside the scope of O 10 r 1(1)(e) RSC.

   (b)The learned master should have found that this Prayer for Relief is outside the scope of O 10 r 1(1)(e) RSC because it seeks a declaration as to the validity and effect of an agreement between the respondent and a third party corporation which is not a party to the proceeding.

2. In short, ground 2 contended that one of the prayers for relief, which sought a declaration, concerned the validity and effect of an agreement between AVW and a corporation other than Bombardier, and was outside the scope of O 10 r 1(1)(e) RSC for that reason.

3. AVW contended that that contention involved a misreading of the pleading.[57]

   [57] Respondent's written submissions at [37], WAB 43.

4. It is not necessary to make any determination in relation to these contentions because, in the course of his oral submissions, counsel for Bombardier conceded that ground 2 would not provide a sufficient basis, by itself, to set aside the grant of leave to issue the writ and serve it outside the jurisdiction.[58]  That being the case, it cannot be said that a substantial injustice would be done if the Primary Decision were permitted to remain undisturbed in this respect.  For that reason, leave to appeal should be refused in respect of ground 2. 

Ground 1

[58] Appeal ts 26 - 27, 55.

1. In ground 1, the appellant contended, in summary, that:

   (a)In refusing to set aside the Orders, the learned master erred in law (Primary Decision [26]) by not holding, as a matter of construction, that the requirement for communication of acceptance had been dispensed with in relation to the written agreements.

   (b)The learned master should have found that, on a proper construction of the contracts, the parties had dispensed with the requirement for communication of acceptance, with the consequence that the respondent had failed to satisfy its onus of showing that the Supreme Court of Western Australia has jurisdiction under O 10 r 1(1)(e) RSC.

Bombardier's submissions

1. Counsel for Bombardier submitted that the learned master erred in two respects.  First, he contended that the learned master applied an erroneous test in that he held that he 'could not conclude with certainty that the general principle as to acceptance has been modified'.[59]

   [59] Appellant's amended written submissions at [10], WAB 11.

2. Secondly, counsel for Bombardier submitted that the learned master erred in his construction of the subject clauses.  In summary, that construction argument rested on the following planks:

   (a)The subject clauses provide expressly for when, and thus where, the contract is made, in the following manner.  The subject clauses should be read in their totality, so as to be understood to say that (in the case of the Termination Deeds) 'this Deed is made … and shall be effective as of the date of its acceptance and execution by the Seller' and in the case of the remaining agreements 'this [Agreement] is made … and shall be effective as of the date of its acceptance and execution by [the] Seller'.[60]  In other words, each of the subject clauses expressly says, in effect, that the contract is made on acceptance and execution by Bombardier.[61] 

   (b)The word 'acceptance' was used in the subject clauses with its ordinary meaning, which was the act of accepting or receiving that which is offered, while 'execution' had its ordinary meaning, which was the manifestation of that acceptance by the execution of the agreement.[62]  The ordinary meaning of the word 'acceptance' does not include 'communication of acceptance' and it was a strained approach to construe the word 'acceptance' as having the meaning attributed to it in the law of contract, as involving legal modes of acceptance.[63]  Even if that were the case, it does not follow that acceptance of an offer must always include the communication of that acceptance.[64]

   (c)The word 'acceptance' connoted an internal act, which was then outwardly manifested by the execution of the agreement.[65]  In other words, the word 'acceptance' connoted a mental state reached and uncommunicated.[66]

   (d)The subject clauses thus made it clear that acceptance and execution, without any requirement for communication of the acceptance, created a binding contract.  The language used showed clearly that 'acceptance and execution' by Bombardier, without more, completed the contract in each case, and indicated that no further act was required to bring the contract into existence.[67]  That language was not consistent with an anterior requirement of communication of acceptance before the contract was made.[68] 

   (e)In each of the subject clauses, the phrase used was 'acceptance and execution', in that order, which indicated that the last act necessary for an agreement to be made was the execution by the seller.[69]

   (f)The use of the definite article - the agreement / Deed shall be effective as of the date of its acceptance and execution - indicated that acceptance and execution would happen at the same time, and that the written agreement would be effective as of the date of its acceptance.[70]

   (g)That construction was commercially sensible and resulted in no difficulty in the practical operation of the agreements.[71]

   (h)In so far as some of the written agreements were styled as deeds, the express provision that the deed 'shall be effective as of the date of its acceptance and execution by the Seller' indicated that the deed would have been executed first by AVW, or, alternatively, that if AVW executed the deed after Bombardier, then subject to the question of communication of acceptance, the contract would be regarded as effective at the date on which Bombardier executed it.[72]  Counsel for Bombardier submitted that the evidence was that Bombardier would prepare the written agreements and then send them to AVW.[73]

   [60] Appeal ts 11.

   [61] Appeal ts 10 - 11.

   [62] Appeal ts 12.

   [63] Appeal ts 14 - 15.

   [64] Appeal ts 14 - 15.

   [65] Appeal ts 20.

   [66] Appeal ts 20.

   [67] Appeal ts 10.

   [68] Appellant's amended written submissions at [21], WAB 12.

   [69] Appeal ts 12.

   [70] Appeal ts 19 - 20.

   [71] Appellant's amended written submissions at [23(a)].

   [72] Appeal ts 11.

   [73] Appeal ts 22.

1. Counsel for Bombardier also submitted that although the question whether parties have agreed to dispense with the requirement for communication of acceptance is a question of fact, in this case the answer to that question depended on the construction of the subject clauses, and that those construction questions were purely questions of law.  He submitted that where the existence of jurisdiction depends on the resolution of a question of law, the court would normally decide the question of law, as opposed to merely seeing if there is a good arguable case on the issue of law.[74] 

   [74] Appellant's amended written submissions at [8], WAB 9 ‑ 10.  Counsel cited AK Investment CJSC v Kyrgyz Mobil Tel Limited [2011] UKPC 7 [81] and VTB Capital plc v Nutritek International Corp [2013] UKSC 5; [2013] 2 AC 337 [164] (Lord Clarke) in support of this proposition.

2. Counsel for AVW submitted that the subject clauses did not affect when the agreement was made, and in effect left the position concerning when the contract was made to be determined having regard to ordinary common law principles.[75]

Ground 1 - contractual acceptance - legal principles

[75] Appeal ts 54.

1. It is a fundamental premise of the law of contract that acceptance of an offer involves a communication, to the offeror, of both an unqualified agreement to the terms of the offer and to the implied invitation within the offer that the offeree commit to a contract.[76]  The general rule is that the contract will not be made until the acceptance has been communicated, by some external manifestation of assent, to the offeror.[77] 

   [76] See, eg, N.C. Seddon and R.A. Bigwood, Cheshire and Fifoot Law of Contract, 11^th Australian ed, 2017 [3.22].

   [77] Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523, 534 (McHugh JA, Samuels JA agreeing); DJE Constructions Pty Ltd v Maddocks [1982] 1 NSWLR 5, 19 (Samuels JA, Glass JA agreeing); Latec Finance Pty Ltd v Knight [1969] 2 NSWR 79, 81 (Jacobs JA, Sugarman JA & Walsh JA agreeing); see generally, N.C. Seddon and R.A. Bigwood, Cheshire and Fifoot Law of Contract, 11^th Australian ed, 2017 [3.39]; J.D. Heydon, Heydon on Contract, 2019 [2.440].

2. However, there are exceptions to that general rule.  As the requirement for acceptance to be communicated to the offeror is a rule that exists for the benefit of the offeror, the offeror is entitled to dispense with notice to himself or herself.[78]  By way of example, in a unilateral contract, where the offer takes the form of a promise to pay money in return for a specified act, waiver of the requirement for notice is ordinarily assumed.[79]  That is because the nature of the transaction itself will permit an inference to be drawn that the requirement for notification of acceptance has been waived. 

   [78] Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256, 269 ‑ 270 (Bowen LJ).

   [79] Carlill v Carbolic Smoke Ball Co (269 - 270) (Bowen LJ).

3. If the parties to a bilateral contract wish to waive the requirement for communication of the acceptance of the offer, that waiver must be made clear from the express words used by the parties, or must be very clearly inferred from the circumstances,[80] such as from the conduct of the offeree in performing its obligations under the contract.[81] 

   [80] Latec Finance Pty Ltd v Knight (81) (Jacobs JA, Sugarman JA & Walsh JA agreeing), referring to Robophone Facilities Ltd v Blank [1966] 3 All ER 128, 131 (Lord Denning).

   [81] See, eg, Brogden v Metropolitan Railway Co (1877) 2 App Cas 666.

4. The question at the heart of ground 1 is thus whether, by each of the subject clauses, AVW and Bombardier agreed to dispense with the requirement for communication of Bombardier's acceptance of the terms of AVW's offer, which was constituted by the written agreement executed by AVW and sent to Bombardier. 

5. There was no dispute that, on an application to set aside the grant of leave to issue and serve a writ outside Australia, the onus remains on the plaintiff to demonstrate that the case falls within one of the pigeonholes in O 10 r 1(1) RSC.[82] 

   [82] Voth v Manildra Flour Mills Pty Ltd (564) (Mason CJ, Deane, Dawson & Gaudron JJ).

6. Accordingly, the onus remained on AVW to demonstrate that there was a good arguable case that the written agreements were made in Western Australia, because the parties had not dispensed with the requirement for Bombardier to communicate to AVW its acceptance of AVW's offer. 

7. The answer to that question depends on the proper construction of the subject clauses in the Termination Deeds, the Aircraft Purchase Agreements and the Amendment Agreement. 

Ground 1 - disposition

1. At the outset, it is convenient to deal with Bombardier's contention that the learned master applied the wrong test when he concluded, in the paragraph of the Primary Decision set out at [44] above, that 'the words of these two clauses are not sufficient to conclude with certainty that the general principle as to acceptance had been modified.'

2. Bombardier's contention that that constituted an error must be rejected.  The language used by the learned master merely reflected the requirement of the common law that the parties (or at least the offeror) must clearly manifest an intention to dispense with the requirement that acceptance of a contract must be communicated to the offeror.  The observation that he could not 'conclude with certainty' merely conveyed the master's view that the intention to dispense with the requirement for communication of the acceptance was not expressed or conveyed with sufficient certainty or clarity to discern a departure from the common law rule. 

3. Furthermore, the learned master clearly applied the correct test at other points in the Primary Decision, namely to consider whether AVW had established that there was a good arguable case that the agreements were made in Western Australia. 

4. We turn next to consider the proper construction of each of the subject clauses. Before doing so, it is appropriate to address the submission that the construction question should have been finally determined by the learned master, rather than solely by reference to whether AVW had a good arguable case.

5. Counsel for Bombardier submitted that the question whether this case fell within the pigeonhole in O 10 r 1(1)(e) RSC fell to be determined solely on the basis of the construction of the written agreements, which involved a pure question of law. In those circumstances, he submitted that the learned master ought to have finally determined the proper construction of the subject clauses, and thus to finally determine whether the written agreements were made in Western Australia, rather than merely considering whether AVW had established a good arguable case that its case fell within the pigeonhole in O 10 r 1(1)(1)(e) RSC. Those submissions appeared to suggest that implicit within ground 1 was an alleged error by the learned master in failing to finally resolve the question whether each of the written agreements dispensed with the usual rule requiring communication of the acceptance of an offer. We are unable to accept that the learned master erred in that respect, for the following reasons.

6. First, the approach adopted by the learned master was entirely orthodox, and was consistent with the approach adopted in this State in determining whether a case falls within one of the pigeonholes in O 10 r 1(1) RSC, and as to which there was no dispute between the parties (other than in relation to the present submission).

7. Secondly, the authority cited by counsel for Bombardier did not support the submission he advanced.  Counsel relied, in particular, on the summary of principles approved by Lord Clarke in VTB Capital plc v Nutritek International Corp.[83]That case pertained to the position under the relevant English rules of court.  In any event, the principle to which Lord Clarke referred was that 'where a question of law arises in connection with a dispute about service out of the jurisdiction and that question of law goes to the existence of the jurisdiction … then the court will normally decide the question of law, as opposed to seeing whether there is a good arguable case on that issue of law' (emphasis added).  There was no suggestion that the primary court was obliged to finally decide questions of law in the course of dealing with an interlocutory application concerning service outside the jurisdiction, or that a failure to do so would constitute appellable error.

   [83] VTB Capital plc v Nutritek International Corp [164] (Lord Clarke).

8. Thirdly, considerable caution is required in determining questions of law on interlocutory applications, especially if there is any room for doubt about the facts on which such questions fall to be decided.[84]  That approach strongly militates against the conclusion that a court is obliged to finally determine a question of law on an interlocutory application.

   [84] Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1 [168] - [170] (Kirby & Callinan JJ); Perre v Apand Pty Ltd [1999] HCA 36; (1999) 198 CLR 180 [436] (Callinan J); see also, Bass v Permanent Trustee Co Ltd [1999] HCA 9; (1999) 198 CLR 334 [47] - [48] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne & Callinan JJ).

9. Fourthly, if the precise question of construction raised by the Application - namely whether the subject clauses dispensed with the ordinary rule requiring communication of acceptance - was finally resolved against Bombardier, there may well remain broader questions as to the proper construction of those clauses and their operation in the context of the written agreements, since these clauses may have other significance for the disputes between the parties.  Such questions would involve mixed questions of fact and law, as to which no facts were agreed for the purposes of the Application. 

10. In all these circumstances, the correct approach was, and remains, to confine the analysis to whether AVW has a good arguable case that its case falls within the pigeonhole in O 10 r 1(1)(e) RSC.

The principles applicable to the construction of the Termination Deeds and the other written agreements

1. As we have noted, the Termination Deeds were styled as deeds and purported to have been signed, sealed and delivered as deeds. 

2. In this State, the mandatory minimum requirements which must be met for a document to constitute a deed are set out in s 9 of the Property Law Act 1969 (WA).[85] Non-compliance with the requirements of s 9 of the Property Law Act will mean that the document will not constitute a deed.[86] 

   [85] Netglory Pty Ltd v Caratti [2013] WASC 364 [102] (Edelman J).

   [86] Netglory Pty Ltd v Caratti [96] (Edelman J).

3. While the Termination Deeds purported to be deeds, on their face they do not appear to have been executed by Bombardier in compliance with the requirements of s 9 of the Property Law Act.[87]  They were not attested to by at least one witness.  They were not executed by Bombardier under a common or official seal,[88] or by the directors of the corporation.[89]  Counsel for Bombardier conceded that the Termination Deeds were signed only by an individual - relevantly, either Mr Ercolanese or Mr Ouellette[90] - neither of whom was a director of Bombardier.[91]

   [87] cf s 9(4) Property Law Act 1969 (WA).

   [88] cf s 9(2) Property Law Act 1969 (WA).

   [89] See s 127(3) Corporations Act 2001 (Cth).

   [90] Affidavit of David Nemes sworn 18 December 2017, [53(a)] and [54(b)], GAB 630 ‑ 631.

   [91] See generally, affidavit of David Nemes sworn 18 December 2017, annexures DN3 ‑ DN10, GAB 595 ‑ 661; Appeal ts 44.

4. An instrument described as a deed, but which does not meet the requirements of s 9 of the Property Law Act, may nevertheless constitute a contract between the parties, or, alternatively, there may be evidence to support the conclusion that the parties intended to be bound by a contract in terms of the deed.[92]  That may be the case, for example, if there is evidence of consideration passing between the parties, or if there is evidence that the parties have attached themselves to the obligations set out in the document, for example by accepting benefits sufficient to constitute evidence of their implied agreement to be bound, in contract, by the terms of the deed.

   [92] cf Nurisvan Investment Limited v Anyoption Holdings Limited (2017) VSCA 141 [56] ‑ [63].

5. In the present case, the Termination Deeds were stated to be deeds, and purported to have been executed as deeds.  In the absence of any extrinsic evidence to the contrary, it may be inferred that the parties intended that they should have effect as deeds.[93] Although they were not executed in compliance with the requirements for a deed under s 9 of the Property Law Act, and thus do not operate as deeds, the fact that the parties intended the Termination Deeds to have effect as deeds is presently relevant for two reasons. 

   [93] Dean and Westham Holdings Pty Ltd v Lloyd (1991) 3 WAR 235, 252 (Ipp J).

6. First, that consideration confirms that the parties intended that the obligations in each of the Termination Deeds should be binding on them, which supports the conclusion that the parties intended, at the least, to be bound by contracts in the terms of each of the Termination Deeds. 

7. In any event, Bombardier did not contend that the Termination Deeds were not binding. Rather, Bombardier's case at first instance,[94] and on the appeal, was that the Termination Deeds would nevertheless take effect as agreements under Western Australian law, and be governed by ordinary principles of contract law, for the purpose of considering when and where they were made. We did not understand counsel for AVW to cavil with that approach.

   [94] Defendant's outline of submissions in support of chamber summons dated 10 November 2017 [45] ‑ [47], GAB 101.

8. The principles concerning the construction of contracts are therefore applicable (and apply in any event to the construction of deeds[95]). 

   [95] Westgyp Pty Ltd v Northline Ceilings Pty Ltd [No 2] [2019] WASCA 145 [154] (Murphy JA).

9. Secondly, the fact that each of the Termination Deeds were drafted as deeds, and that the parties purported to execute each of them as deeds, explains the inclusion of particular clauses in the Termination Deeds, and is part of the contractual context informing the proper construction of the subject clauses. 

10. The construction of a contract is an objective process.  The meaning of the terms of an instrument is to be determined by what a reasonable person would have understood the terms to mean.[96]  The process of construction involves determination of the meaning of the words by reference to the text, context and purpose of the contract.[97]

    [96] Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640 [35] (French CJ, Hayne, Crennan & Kiefel JJ); Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104 [46] ‑ [47] (French CJ, Nettle & Gordon JJ); Simic v New South Wales Land and Housing Corporation [2016] HCA 47; (2016) 260 CLR 85 [78] (Gageler, Nettle & Gordon JJ).

    [97] Mount Bruce [46] (French CJ, Nettle & Gordon JJ); Simic v New South Wales Land and Housing Corporation [18] (French CJ), [78] (Gageler, Nettle & Gordon JJ).

11. The starting point in the construction of a contract is to look at the language used in the particular clause or clauses in issue[98] and to identify the possible meanings that the words chosen by the parties can bear.[99] 

    [98] Mount Bruce [59] (French CJ, Nettle & Gordon JJ); Sino Iron Pty Ltd v Mineralogy Pty Ltd [2019] WASCA 80 [296] (Buss P, Murphy & Beech JJA).

    [99] Sino Iron Pty Ltd v Mineralogy Pty Ltd [296] (Buss P, Murphy & Beech JJA), referring to Fitness First Australia Pty Ltd v Fenshaw Pty Ltd [2016] NSWCA 207; (2016) 92 NSWLR 128 [32].

12. The instrument should be construed as a whole, and a construction that makes the various parts of the instrument harmonious is preferable.[100]

    [100] Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99, 109 (Gibbs J); Wilkie v Gordian Runoff Ltd [2005] HCA 17; (2005) 221 CLR 522 [16] (Gleeson CJ, McHugh, Gummow & Kirby JJ).

13. In determining the meaning of the terms of a commercial contract, it is necessary to ask what a reasonable businessperson would have understood those terms to mean.  Indeed, at each point where a constructional choice is available, it is important to consider what reasonable business people reading the relevant clause or agreement would understand it to mean.[101]  That enquiry requires a consideration of the language used by the parties in the contract, the circumstances addressed by the contract, and the commercial purpose or objects to be secured by the contract.[102] 

    [101] Sino Iron Pty Ltd v Mineralogy Pty Ltd [298] (Buss P, Murphy & Beech JJA).

    [102] Mount Bruce [46] - [50] (French CJ, Nettle & Gordon JJ).

14. The court is entitled to approach the task of construction on the basis that the parties intended to produce a commercial result, and one which makes commercial sense.  This requires that the construction placed upon the clause be consistent with the commercial purpose or objects of the agreement.[103]  The commercial purpose or objects sought to be secured by the contract will often be apparent from a consideration of the provisions of the contract read as a whole.[104]  An appreciation of the commercial purpose or objects of a contract is facilitated by an understanding of the genesis of the transaction, the background, the context and the market in which the parties are operating.[105]

    [103] Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12; (2017) 261 CLR 544 [17] (Kiefel, Bell & Gordon JJ).

    [104] Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219 [42(3)], citing Secured Income Real Estate (Australia) Ltd v St Martins Pty Ltd (1979) 144 CLR 596, 606.

    [105] Electricity Generation Corporation [35] (French CJ, Hayne, Crennan & Kiefel JJ).

15. Further, an instrument should be construed so as to avoid it making commercial nonsense or giving rise to a commercial inconvenience,[106] bearing in mind that business common sense may be a topic on which minds may differ.[107]

Construction of the Deed acceptance and execution clause

[106] Zhu v Treasurer of the State of New South Wales [2004] HCA 56; (2004) 218 CLR 530 [82]; Electricity Generation Corporation v Woodside Energy Ltd [35] (French CJ, Hayne, Crennan & Kiefel JJ); Mount Bruce [51]; Simic v New South Wales Land and Housing Corporation [78].

[107] Maggbury Pty Ltd v Hafele Australia Pty Ltd [2001] HCA 70; (2001) 210 CLR 181 [43].

1. The Deed acceptance and execution clause is not a model of drafting clarity.  However, in our view, AVW has a good arguable case that the Deed acceptance and execution clause, on its proper construction, does not dispense with the requirement for the communication of Bombardier's acceptance of AVW's offer.  We have reached that view having regard to the following features of the Deed acceptance and execution clause itself, and to the terms of each of the Termination Deeds as a whole.

2. First, on its face, the Deed acceptance and execution clause does two things:  it identifies the parties making the agreement reflected in the Deed, and it identifies that the document 'shall be effective as of' the date of two events:  acceptance and execution.  The clause, with these two effects, does not, contrary to Bombardier's submissions, provide that the contract is made on the date of its acceptance and execution by Bombardier.  Neither of those aspects of the clause expressly waives, or necessarily requires any departure from, or modification of, the ordinary requirement for the communication of Bombardier's acceptance of AVW's offer. 

3. Secondly, the word 'effective' is an adjective, the meaning of which includes 'actually in effect'.[108]  The meaning of the word 'effect' includes 'the state of being operative; operation or execution; accomplishment or fulfilment'.[109]  It is strongly arguable that the word 'effective' in the context of the Deed acceptance and execution clause is used with a meaning different from 'made'.  That is because the clause itself refers both to the Deed being 'made' and it being 'effective' as at a particular date.  Arguably, that signals that the meaning of the word 'effective' in this context is similar to the phrase 'be in effect', namely 'be in operation, as a law'[110] and to 'come into effect', namely to 'become operative, as a law'.[111]  On that basis, it is clearly arguable that the subject clause specifies the date on which the terms of the Deed will come into operation, as opposed to prescribing how and when the contract set out in the Deed will be formed.  In other words, the stipulation in the clause as to the date as of when the instrument will be effective does not speak to, much less control, the question of when the instrument was made.

   [108] Macquarie Dictionary Online.

   [109] Macquarie Dictionary Online. 

   [110] Macquarie Dictionary Online.

   [111] Macquarie Dictionary Online.

1. That construction of the term 'effective' is also supported by the fact that the term 'effective' is used elsewhere in each Termination Deed, and in a context where it is apparent that the word is used to mean 'become operative'.  By way of example, each of the Termination Deeds provides that the termination of the Aircraft Purchase Agreement in each case 'is not effective until such time as the Termination Conditions are satisfied'.[112]  The word ‘effective’ should be given a consistent meaning throughout each Termination Deed.

   [112] See, eg, Annexure ACSC-1 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 475 cl [2].

2. Thirdly, the Deed acceptance and execution clause draws a distinction between 'acceptance' of the terms of the Deed and 'execution' of the Deed.  The ordinary meaning of the term 'acceptance' is 'the act of taking or receiving something offered', and 'the fact or state of being accepted or acceptable'.[113]  The word 'execution' is the passive form of the verb 'execute'.  Among the various ordinary meanings attributable to the word 'execution' is its meaning when used in a legal context, namely 'to transact or carry through (a contract, mortgage etc) in the manner prescribed by law; complete and give validity to (a legal instrument) by fulfilling the legal requirements, as by signing, sealing, etc'.[114]  The Deed acceptance and execution clause thus provides that the Deed 'shall be effective' as of the date of the Seller's (that is, Bombardier's) 'acceptance' - that is, Bombardier's agreeing to be bound to the terms of the Deed set out in AVW's offer - and its 'execution' - that is, Bombardier's completion of the legal requirements for it to enter into the Deed as a deed.[115] 

   [113] Macquarie Dictionary Online.

   [114] Macquarie Dictionary Online.

   [115] In so far as execution of each Deed of Termination is concerned, each Deed contemplated that the parties would formally execute the Deed by signing, sealing and delivering it as a deed.

3. Contrary to the submissions of counsel for Bombardier, it is immediately apparent that acceptance of the legal obligations set out in the Deed, and the formal execution of the Deed itself, might take place on different dates.  It is not difficult to envisage how this might arise in practice.  Bombardier might accept the legal obligations in the Deed, and convey that acceptance to AVW orally or in writing, but not complete the formalities required for execution of the Deed (that is, the formal execution contemplated in the Deed itself) until some time later.  In that event, the contract would be made at the point in time when acceptance was communicated to AVW, but the parties' obligations under the Deed would not fall to be performed until after Bombardier's execution of the Deed.  Alternatively, Bombardier might choose to execute the Deed, but not communicate its acceptance of the legal obligations in the Deed until after that time.  That communication of its acceptance might take place immediately after execution, or alternatively Bombardier might defer communicating its acceptance for some time after execution of the Deed, for example, to enable Bombardier and the new purchaser to complete the formalities for execution of a new purchase agreement for the aircraft in question.  In that event, the contract would not be formed until Bombardier's acceptance was communicated to AVW, at which point the parties would become liable to perform their obligations under the Deed.

4. Subject to the parties' agreement to the contrary, the terms of a contract will ordinarily become effective as at the date the contract is made.  The inclusion of a clause which specifies when the terms of a contract will become 'effective' is necessary if the parties wish to provide for those terms to become operative on a date different from the date that the contract is actually made.  AVW has a good arguable case that the Deed acceptance and execution clause is a clause of that kind, and viewed in that light, the clause does not waive the ordinary requirement that acceptance of a contract must be communicated to the offeror.

5. Fourthly, the Deed acceptance and execution clause must be construed within the context of each Termination Deed in its entirety.  Other provisions of the Termination Deeds also provide some support for the construction of the Deed acceptance and execution clause for which AVW contends.  Each of the Termination Deeds contains a clause in common form, as to its execution by counterparts (counterparts clause).[116] Counsel for Bombardier submitted that there were two aspects to the operation of the counterparts clause.  The first was facilitative - it permitted the execution of the instrument in any number of counterparts and permitted delivery by facsimile or electronic format.  Secondly, the clause provided that the failure to deliver a manually executed counterpart was not to affect the validity, enforceability or binding effect of the Deed.[117] 

   [116] See, eg, Annexure ACSC-1 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 475 cl 6.

   [117] Appeal ts 17.

6. In our view, it is clearly arguable that the counterparts clause has significance for the construction of the Deed acceptance and execution clause.  As events transpired, it appears that the Termination Deeds were not executed in counterpart, and instead, in each case, Bombardier executed a copy of the Deed which had previously been executed by AVW.  Nevertheless, the inclusion of the counterparts clause is relevant for two reasons.  First, it indicates that the parties contemplated that in each case, the Termination Deeds might be executed in counterpart, and then delivered to each other.  That delivery of the counterpart would communicate each party's acceptance of the obligations set out in the Deed.  In that context, it would be quite incongruous for the Deed acceptance and execution clause to be construed as dispensing with any requirement for communication of Bombardier's acceptance.

7. In addition, the fact that each Termination Deed contained a counterparts clause confirms that the parties contemplated the possibility that they may execute counterparts independently.  Arguably, the possibility that either party might execute the Deed first assists to explain why it was the date of acceptance and execution of the Deed by Bombardier, rather than by AVW, which the parties specified as significant in determining the point in time from when they would become liable to perform their obligations under the Deed. 

8. Fifthly, counsel for Bombardier submitted that some significance could be attached to the fact that 'execution' was preceded, in the relevant phrase within the subject clauses, by 'acceptance', and that this conveyed that the contract was not in fact made until it was executed by Bombardier (with the result that the contract would be made at the place where Bombardier's execution of the Deed took place).  Given the other features of the Deed acceptance and execution clause which we have already outlined, we are not persuaded that that significance attaches to the order of use of the words 'acceptance' and 'execution'.

9. Sixthly, there is an obvious commercial rationale for the construction of the Deed acceptance and execution clause for which AVW contends, when regard is had to the practical operation of the Termination Deeds.  The effect of each Termination Deed was to terminate an Aircraft Purchase Agreement between AVW and Bombardier, pursuant to which Bombardier had agreed to sell a particular aircraft to AVW, in return for which AVW had agreed to pay (and in fact had already paid) substantial sums.  That aircraft purchase agreement was to be terminated so that Bombardier could sell the same aircraft to another purchaser, which in turn would obligate Bombardier to pay a significant sum (a Termination Payment) to AVW.  Furthermore, under each Termination Deed, it was Bombardier who bore the primary obligation of performance, in that it was obliged to make the Termination Payment, to refund payments already made by AVW, and to make further payments to AVW.[118]  Without the utmost clarity about when its legal obligations under the Termination Deed became operative, Bombardier was at risk of being said to be under a legal obligation to sell an aircraft to AVW, and an offer to sell that very same aircraft to another purchaser, and consequently at risk of being regarded as having breached, or being liable to breach, its contractual obligations to either or both AVW and the third party purchaser. 

   [118] See, eg, Annexure ACSC-1 to the affidavit of Adrian Chin Shien Chai sworn 10 November 2017, GAB 475 cl [1], [3], [4].

10. At the same time, from AVW's commercial perspective, it was critical that it be made aware that Bombardier had agreed to subject itself to the obligations set out in the Termination Deed.  As counsel for AVW noted, if Bombardier was correct that the meaning of 'acceptance' in the written agreements referred solely to an internal decision, or psychological state, on Bombardier's part, to commit to the terms of AVW's offer, which need not be manifested in any external sign, the written agreements contained no means by which AVW could compel Bombardier to disclose whether it had accepted the terms of the agreement.[119]  That outcome would be commercially unworkable. If the effect of the Deed acceptance and execution clause was that Bombardier was free to accept AVW's offer but without communicating that acceptance to AVW, then if Bombardier failed to promptly send the executed Deed to AVW, and then failed to perform its substantive obligations arising from the completion of the agreement, AVW would have no means to ascertain whether Bombardier was in breach of a contractual obligation which had come into existence.  Furthermore, in circumstances where the parties contemplated that AVW would pay a substantial amount prior to the completion of the Aircraft Purchase Agreement in each case, it would be important, from a commercial perspective, for AVW to be in a position to know, with certainty, whether Bombardier had agreed to be bound by the terms of the Termination Deed, because that would have an impact on whether AVW was obliged to continue to perform its obligations under the Aircraft Purchase Agreement (including any obligations for payments in advance of completion of the sale).  The construction of the Deed acceptance and execution clause for which Bombardier contends would undermine those obvious commercial objectives.

    [119] Appeal ts 48.

11. Seventhly, the commercial rationale advanced by counsel for Bombardier in support of the construction of the Deed acceptance and execution clause preferred by Bombardier was that 'it made obvious commercial sense for Bombardier to have absolute certainty that the [T]ermination [D]eed was made as at the date it accepted and executed the agreement, to avoid the risk of agreeing to sell to a third party an aircraft that it remained obliged to sell to [AVW]'.[120]  As we have explained, it is not necessary to construe the Deed acceptance and execution clause in the manner for which Bombardier contends, so as to dispense with the requirement for communication of its acceptance of the terms set out in the Deed, in order for this commercial objective to be achieved.  Moreover, it is difficult to see why it was not in Bombardier's interests to communicate its acceptance to AVW, so that there would be no doubt about Bombardier's entitlement to proceed to enter into another sale agreement with a third party buyer for the aircraft in question. 

    [120] Appellant's amended written submissions at [23(b)], WAB 13 ‑ 14.

12. Counsel for Bombardier also submitted that 'it makes sound commercial sense for Bombardier as a supplier of aircraft to customers around the world carrying on an international business, to seek to exercise some control over when and where purchase agreements and termination deeds are made'[121] because of the impact of those circumstances on the jurisdictions in which such agreements could be sued upon.  While that may be so, that submission does not overcome the difficulties posed for Bombardier's construction argument which are discussed above, so as to undermine AVW's good arguable case on the construction of the Deed acceptance and execution clause. 

    [121] Appellant's amended written submissions at [23(d)], WAB 14.

13. Having regard to all of these considerations, AVW clearly has a good arguable case that the Deed acceptance and execution clause, on its proper construction, did not dispense with the requirement for the communication of Bombardier's acceptance of AVW's offer.  In each case it received that communication when it received, by email, Bombardier's executed copy of the Termination Deed. 

The construction of the Agreements acceptance and execution clause

1. The Agreement acceptance and execution clause is in relevantly identical terms to the Deed acceptance and execution clause.

2. The considerations discussed at [99], [100], [102], [103], [104], [108], and [112] above, apply equally in the context of the provisions of the Agreement acceptance and execution clause.

3. In addition, AVW's case for the construction of the Agreement acceptance and execution clause is strongly assisted by considerations of commercial efficacy.  Under each of the Agreements, AVW was obliged to make its first payment for the aircraft in question 'upon the Buyer's execution of this Agreement'.  In each case, that initial payment was in the sum of at least $2,500,000.  In those circumstances, it would be imperative that AVW have certainty that its offer had been accepted by Bombardier, because without notice that Bombardier had accepted its offer, AVW would be in the position where it had paid a substantial sum to Bombardier without knowing whether Bombardier was entitled to retain that sum.

4. All of these considerations amply demonstrate that AVW has a good arguable case that the Agreement acceptance and execution clause did not dispense with the requirement for communication of Bombardier's acceptance of each of AVW's offers to contract in terms of each of the Agreements.

The construction of the Amendment Agreement acceptance and execution clause

1. We turn, finally, to the Amendment Agreement acceptance and execution clause. The clause is set out in full at [32] above.

2. As we have already noted, the terms of that clause are different from the terms of the Deed acceptance and execution clause, and the Agreement acceptance and execution clause.  However, it remains the case that AVW has a good arguable case that the Amendment Agreement acceptance and execution clause does not dispense with the requirement for the communication by Bombardier of its acceptance of AVW's offer to amend the earlier Amended and Restated Aircraft Purchase Agreement.  We are persuaded that that is so having regard to the following considerations.

3. First, the clause provides that 'this Agreement is made on the date of its acceptance and execution by [the] Seller'.  The clause does not expressly dispense with the requirement for acceptance of an offer to be communicated to the offeree. 

4. Secondly, like the Deed acceptance and execution clause, and the Agreement acceptance and execution clause, the Amendment Agreement acceptance and execution clause is designed to designate when the terms of the Amendment Agreement will become effective.  However, the Amendment Agreement acceptance and execution clause does so more directly:  it provides that the provisions of the Amendment Agreement will 'have effect and govern the contractual relationship between the parties on and from' a particular date.  Viewed from that perspective, the clause is not directed to dispensing with the requirement for communication of Bombardier's acceptance of AVW's offer.

5. Thirdly, the clause provides that the Agreement will be 'made' on the happening of two events, namely Bombardier's acceptance and execution of the Agreement.  For the reasons discussed above at [102], the terms 'acceptance' and 'execution' mean different things.  To our mind, the most likely explanation for the inclusion of the requirement that the Amendment Agreement be made only upon its 'acceptance' and 'execution' is that the parties were concerned to ensure that there was no uncertainty as to whether Bombardier agreed to the terms of the Amendment Agreement.  That being the case, they sought to require that Bombardier both accept AVW's offer to amend, and to formally record its acceptance by executing the Amendment Agreement.  The inclusion of a requirement for execution as well as for acceptance does not, of itself, compel the conclusion that the parties intended to dispense with the requirement for Bombardier to communicate its acceptance of the Amendment Agreement to AVW.

6. Fourthly, commercial considerations strongly militate against the conclusion that the parties intended to dispense with the requirement for Bombardier to communicate its acceptance of AVW's offer to amend.  The Amendment Agreement sought to amend and restate the terms of an earlier Amended and Restated Aircraft Purchase Agreement.  There was no evidence as to the manner in which that earlier agreement was amended by the Amendment Agreement.  However, in the context of an Aircraft Purchase Agreement under which AVW agreed to the upfront payment of large sums, it remained essential that AVW be made aware of whether Bombardier had accepted its offer to amend that Agreement.  Furthermore, a requirement for the communication of Bombardier's acceptance of AVW's offer was not adverse to Bombardier's commercial position. 

7. Counsel for Bombardier submitted that the evidence established that the Amendment Agreement was entered into on the same day as, or just before, a Termination Deed.[122]  He submitted that this provided a clear commercial justification for why the parties agreed that it was the Amendment Agreement which was operative at the time that the Termination Deed became operative to bring it to an end.  That argument did not, with respect, advance the construction of the Amendment Agreement acceptance and execution clause for which

   
   

   Bombardier contended, nor did it undermine the construction advanced by AVW.  On the contrary, if the Amendment Agreement was intended to replace an earlier Aircraft Purchase Agreement, before the termination of that by the parties' entry into a Termination Deed, then commercial imperatives would favour the retention of the requirement to communicate Bombardier's acceptance of AVW's offer to amend the Aircraft Purchase Agreement, because it would be important for AVW to be clear that the Amendment Agreement had in fact been made, prior to its agreeing to enter into a deed to terminate that agreement.  (Bombardier's commercial interests would be protected by virtue of the fact that its acceptance and execution was essential to the Amendment Agreement becoming effective in any event.) 

   [122] Appellant's supplementary written submissions at [23(c)].

8. In our view, therefore, AVW has a good arguable case that none of the written agreements dispensed with the requirement for Bombardier's acceptance of AVW's offer to be communicated to AVW. It has a good arguable case that each of the written agreements was made upon AVW's receipt of notice of Bombardier's acceptance of the agreement, which occurred when AVW received an emailed copy of the signed agreement. As the email was received at AVW's offices in Western Australia, AVW thus has a good arguable case that each of the written agreements were made in Western Australia, so that its case fits within the pigeonhole in O 10 r 1(1)(e) RSC.

9. Consequently, viewed in isolation, ground 1 has insufficient merit to sustain a grant of leave to appeal as the learned master's decision in this respect has not been shown to be plainly wrong, or attended by doubt. In any event, were leave to be granted, for the above reasons, ground 1 would fail.

Ground 4

1. In ground 4,[123] the appellant contended, in summary:

   [123] In the course of the hearing of the appeal, Bombardier was granted leave to amend ground 4 of its grounds of appeal and to rely on supplementary submissions dated 12 April 2019: Appeal ts 2.

   (a)In refusing to set aside the Orders, the learned master erred in law and in fact (Primary Decision [35] ‑ [36]) by finding that Western Australia is not an inconvenient forum by:

   (i)Erroneously reversing the onus of proof by proceeding on the basis that the appellant had to show that Western Australia was a clearly inappropriate forum, when it was for the respondent as the party which obtained leave to serve ex juris, to establish that Western Australia was not a clearly inappropriate forum and that the action would not subsequently be stayed on the basis of forum non conveniens;

   (ii)Erroneously approaching the 'clearly inappropriate' forum test by considering that the test was whether Canada would be a 'more appropriate' forum and erroneously undertaking a comparison of the relative advantages and disadvantages of the proceedings being heard in Western Australia and Canada;

   (iii)Finding that 'most of the evidence in this case' will be of a documentary nature, when that finding was erroneous and/or had no proper basis;

   (iv)Finding that if there was any disadvantage arising from key witnesses for the appellant being no longer employed by the appellant, not being compellable, and being based in Canada or out of the Western Australian jurisdiction, such disadvantage rested solely upon the respondent, when that finding was erroneous and/or had no proper basis; and

   (v)Finding and/or relying upon a finding that 'witnesses are as compellable in Australian courts as they are in Canadian courts', when that finding was erroneous and/or had no proper basis.

   (b)In the circumstances the learned master's exercise of discretion in considering whether to set aside the Orders miscarried.

   (c)The learned master should have found that the respondent's claims as to the existence and terms of the three alleged oral agreements relied upon will depend primarily upon oral evidence, that there are likely to be contested issues of fact as to the making of a number of the alleged oral representations, that issues as to credibility are likely to arise, and that the combination of the inability of the appellant to compel key witnesses to give evidence in Western Australia and the prospect that key evidence may be required to be taken by video-link mean that the Supreme Court of Western Australia is a clearly inappropriate forum in which to determine this claim.

   (d)In the alternative, in re-exercising the discretion, having regard to the matters set out in [127(a)] and [127(b)] above, this Court should, for the reasons set out above, find that the Supreme Court of Western Australia is a clearly inappropriate forum in which to determine this claim and on that basis set aside the Orders.

2. In its supplementary submissions in relation to ground 4, Bombardier submitted that the learned master erred (at [34] of the Primary Decision) by reversing the onus of proof applicable in an application to set aside leave to serve, and service, out of the jurisdiction, in that the master concluded that in respect of the second limb of the Application it was for Bombardier to establish that Western Australia was a clearly inappropriate forum. 

3. However, counsel for Bombardier acknowledged[124] that elsewhere in his reasons,[125] the learned master stated that AVW continued to bear the onus of establishing both that the jurisdictional prerequisites were satisfied, and that the circumstances favoured the exercise of discretion to grant leave to serve outside the jurisdiction. 

   [124] Appellant's supplementary written submissions [3].

   [125] Primary Decision [19].

4. Counsel for Bombardier submitted that it was for AVW to show that Western Australia was not a clearly inappropriate forum.[126]  In support of his submission that the learned master incorrectly regarded Bombardier as bearing the onus of proof on the second part of the Application, counsel for Bombardier relied on the following passage from the joint judgment of Mason CJ, Deane, Dawson and Gaudron JJ in Voth v Manildra Flour Mills:[127]

   In the present case, the Court has before it an application to set aside service effected pursuant to an ex parte grant of leave to serve outside the jurisdiction.  Where a case falls within a category in which the legislature has seen fit to allow service outside the jurisdiction if, but only if, the leave of a court is first obtained, that court should not grant leave unless it is positively persuaded that it should do so.  Plainly, it should not be so persuaded unless the plaintiff satisfies it that the case is of the relevant category and that the proceedings would not be subsequently stayed as an abuse of process on forum non conveniens grounds or for some other reason.  In such a case the onus should remain on the plaintiff on a subsequent application to set aside the service outside the jurisdiction.  Otherwise the ex parte order for service outside the jurisdiction, if onus of proof were to be decisive, would confer an enduring advantage upon a plaintiff notwithstanding that the expanded evidence on a contested application to set aside service indicated that the applicant had not been entitled to that ex parte order.

   [126] Appellant's supplementary written submissions [1].

   [127] Voth v Manildra Flour Mills (564).

5. Counsel for Bombardier also relied on the decision of the Full Court of the Federal Court in Tiger Yacht Management Ltd v Morris.[128]

   [128] Tiger Yacht Management Ltd v Morris [2019] FCAFC 8 [83], [100(9)], [100(10)] (McKerracher, Derrington & Colvin JJ).

6. In our view, it is far from clear that the learned master in fact erred in the manner for which Bombardier contends, for the following reasons. First, it is not clear that the learned master ultimately reversed the onus at all, as Bombardier contended. There is no doubt that the learned master employed the correct test in respect of the issue raised on the second limb of the Application, namely to determine whether Western Australia was a clearly inappropriate forum for the determination of the dispute.  After considering the factors he considered relevant to that question, the learned master again referred to the issue as being whether it had been shown (necessarily by AVW) that Western Australia was not a clearly inappropriate forum.[129]

   [129] Primary Decision [36].

7. Secondly, neither Voth nor Tiger Yacht Management concerned the requirements of O 10 RSC. Strictly speaking, therefore, neither decision is determinative of the onus of proof on the second limb of an application to set aside leave to issue and serve under O 10 RSC.

8. On the other hand, there is some contrary authority in this State, which expressly deals with this aspect of the onus of proof in an application to set aside the grant of leave.  In Crawley Investments Pty Ltd v Elman, Edelman J accepted a submission by counsel for the applicant in that case that the onus in relation to the second limb under O 10 - the exercise of discretion by the Court - fell on the applicant to set aside the grant of leave (that is, the defendant served outside Australia). His Honour reached that conclusion on the basis that it was consistent with the principle that an applicant generally bears the onus of proof, and consistent with the treatment of an application to set aside a writ and service in the same manner as a local application for summary judgment.[130]  In the latter respect, his Honour adopted the approach taken in the joint judgment in Agar v Hyde.[131]

   [130] Crawley Investments Pty Ltd v Elman [45(7)] (Edelman J).

   [131] Crawley Investments Pty Ltd v Elman [45(5)] (Edelman J) referring to Agar v Hyde (576) [60] (Gaudron, McHugh, Gummow & Hayne JJ). 

9. Thirdly, in our view, it is unnecessary to resolve the question of where the onus lies in order to resolve the present appeal.  The members of the joint judgment in Voth noted that in practice, the differing onus should raise no real difficulty, given the content of the applicable test, namely whether the local court is a clearly inappropriate forum.[132]  It may be that, on occasion, the onus of proof may be decisive in the determination of an application to set aside the grant of leave to issue and serve a writ outside Australia.  However, this is not such a case.  Both parties adduced evidence on the Application.  The learned master considered, correctly, the question of whether Western Australia was a clearly inappropriate forum.  Bearing in mind the terms in which the master expressed his conclusion, it is not at all clear that onus influenced the master's conclusion or that any error as to onus was material to his decision.  In any event, even if the learned master erred in the approach he took, and even if the error were material, so that it were necessary for this court to undertake that assessment, for the reasons below, we would not reach a conclusion different from that reached by the learned master.

   [132] Voth v Manildra Flour Mills Pty Ltd (565) (Mason CJ, Deane, Dawson & Gaudron JJ).

10. Before turning to consider the specific errors Bombardier contends were made by the learned master in assessing whether Western Australia was a clearly inappropriate forum, it is appropriate to mention one further matter.  Counsel for Bombardier appeared to be critical of the learned master for giving 'short shrift'[133] to the exercise of discretion involved in the question of whether the Supreme Court of Western Australia was a clearly inappropriate forum.  It should be remembered that on an application to set aside the grant of leave to issue and serve a writ outside Australia, the primary judge or master is not expected to conduct a mini trial.  Instead the primary judge is expected to make a decision having regard to the evidence led on the application, in light of the applicable law, and with the assistance of short submissions which identify relevant factors connecting the action with the jurisdiction.  Ordinarily, it will be unnecessary to do more than briefly indicate that, having examined the material in evidence, and having taken account of the competing written and oral submissions, the learned primary judge is of the view that the proceedings should or should not be stayed on clearly inappropriate forum grounds.[134] 

    [133] Appeal ts 38.

    [134] Voth v Manildra Flour Mills Pty Ltd (565) (Mason CJ, Deane, Dawson & Gaudron JJ).

11. We turn, next, to consider the specific errors said to have been made by the learned master.  Counsel for Bombardier submitted that the learned master fell into error, at [35] of the Primary Decision, by comparing the Canadian and Western Australian forums rather than focusing on whether the Western Australian court was a clearly inappropriate forum.  However, counsel for Bombardier ultimately acknowledged that the learned master expressed the test correctly in [34] and [36] of the Primary Decision.[135] 

    [135] Appeal ts 38.

12. The question whether the local court is a clearly inappropriate forum focuses on the inappropriateness of the local court and not on the appropriateness or comparative appropriateness of the suggested foreign forum.[136]  However, the application of the clearly inappropriate forum test necessarily involves an evaluation reached by identifying all relevant facts and circumstances, including the connections which exist between the parties and the subject matter of the litigation within the local forum, and identifying whether any other forum might be available in which the proceedings could be pursued.  The latter consideration may involve identifying what connections the proceedings might have with other forums.[137]  The analysis will be relevant to whether the continuation of proceedings in the local forum would be oppressive or vexatious.

    [136] Voth v Manildra Flour Mills Pty Ltd (565) (Mason CJ, Deane, Dawson & Gaudron JJ).

    [137] See, for example, Voth v Manildra Flour Mills Pty Ltd (570 - 571) (Mason CJ, Deane, Dawson & Gaudron JJ).

13. Counsel for Bombardier accepted that some comparison may be permissible, but was not prepared to accept that the application of the clearly inappropriate forum test would necessarily involve a comparison between different jurisdictions.  Instead, he submitted that the test could be applied without comparison.[138]  However, in the course of his submissions, counsel for Bombardier submitted that the forum which was not clearly inappropriate was Canada, and explained why that was so.[139] 

    [138] Appeal ts 39.

    [139] Appeal ts 43.

14. On a fair reading of the learned master's reasons, there is no basis for concluding that the learned master made the error for which Bombardier contends.  In [35] of the Primary Decision, the learned master was addressing the submissions advanced by Bombardier as to why Western Australia was a clearly inappropriate forum, and why Canada was not a clearly inappropriate forum.  When read with [36] of the Primary Decision, it is apparent that the learned master resolved the Application by reference to whether Western Australia was a clearly inappropriate forum for the resolution of the dispute.

15. Next, counsel for Bombardier submitted that the learned master made three factual errors.  First, he submitted that the learned master erroneously found that 'most of the evidence' would be of a documentary nature, when, on his submission, the alleged oral agreements would be a significant part of the case, and a very significant amount of the evidence would concern those oral agreements.[140] 

    [140] Appeal ts 42; Appellant's written submissions at [42] - [45].

16. In our view, no error was made by the learned master.  There is no doubt that a very significant volume of documentary evidence is likely be adduced in evidence at the trial.  Much of it appears to have been annexed to the affidavits relied on by the parties on the Application.  There is no basis to doubt the accuracy of the learned master's observation that there is likely to be a greater volume of documentary evidence than oral evidence led at the trial.  The likely significance of the documentary and oral evidence in resolving particular issues at the trial - which appeared to lie at the heart of this aspect of Bombardier's submissions - was relevant to an entirely different question, namely whether oral evidence could be adduced from relevant witnesses if the proceedings were conducted in Western Australia.  The learned master clearly acknowledged that oral evidence would also be adduced, and he considered the parties' submissions in relation to that issue. 

17. Counsel for Bombardier contended that the second factual error made by the learned master was to find that any disadvantage arising from evidence being given by video-link fell solely upon AVW, when there was no proper basis for that finding. The learned master's observations are set out at [50] above.

18. Counsel for Bombardier submitted that the Court's assessment of the credibility of the various witnesses would be critical to the outcome of the dispute concerning the alleged oral agreements.  He further submitted that 'an assessment of the credibility of a witness may be impacted upon by the fact that the evidence, if available at all, is available only by video‑link.  That is a disadvantage that impacts upon the party seeking to rely upon the evidence, just as it may impact upon the party seeking to cross-examine the witness'.[141] 

    [141] Appellant's written submissions at [47].

19. The learned master's observations need to be understood in the context of the practice of the Supreme Court.  It is common for the Court to receive evidence by video‑link, and the Court's facilities are such that the quality of the visual and audio link permits the Court to see and hear a witness' evidence with sufficient clarity to make an assessment of the witness' credibility, if that is in issue.  We adopt the observations to that effect in Westraint Resources Pty Ltd v BHP Iron Ore Pty Ltd [No 5].[142]  Furthermore, in many cases, the Court will receive a witness statement as the evidence in chief of the witness.  That is no doubt what the learned master had in mind when he noted that if there was any disadvantage in the reception of the evidence by video‑link, the disadvantage would fall on the party cross examining the witness, namely AVW.  Understood in that context, we are not persuaded that the learned master made the error for which Bombardier contends.

    [142] Westraint Resources Pty Ltd v BHP Iron Ore Pty Ltd [No 5] [2010] WASC 62 [12] ‑ [13].

20. Bombardier contended that the third factual error made by the learned master was to find that 'witnesses are as compellable in Australian courts as they are in Canadian courts'.[143]  Counsel for Bombardier submitted that there was no basis for that conclusion.  We are not persuaded that the learned master made the error for which Bombardier contends.

    [143] Primary Decision [36].

21. At the hearing of the Application, counsel for both parties made submissions about the compellability of witnesses.[144]  The submissions by counsel for Bombardier also addressed the potential difficulty in compelling a Canadian witness to give evidence in Western Australia.[145]  (Those submissions appear to have been what the learned master had in mind when he observed that 'witnesses are as compellable in Australian courts as they are in Canadian courts with some added complications.'[146]) However, as counsel for Bombardier acknowledged,[147] no evidence was led on the Application as to whether witnesses could be compelled to appear in Canadian courts.  In the absence of any such evidence, the learned master was entitled to assume that the position under Canadian law was the same as under Western Australian law.[148]

    [144] ts 141, 156 - 162.

    [145] ts 141.

    [146] Primary Decision [36].

    [147] Appeal ts 43.

    [148] Neilson v Overseas Projects Corporation of Victoria Ltd [2005] HCA 54; (2005) 223 CLR 331, 372 [125] (Gummow & Hayne JJ), 411 [249] (Callinan J), 416 ‑ 418 [267] ‑ [268] (Heydon J).

22. Furthermore, these aspects of Bombardier's contentions must be viewed in perspective.  No evidence was led by Bombardier that it had made enquiries of the persons likely to be called by it as witnesses in relation to the oral agreements - namely Mr Ridolfi, Mr Erconalese and Mr Martel - or that those witnesses had indicated that they would not agree to attend a trial in Western Australia.  There was, therefore, no evidence that those witnesses would in fact need to be compelled to give evidence, or that they would need to give evidence by video‑link. Absent any evidence that Bombardier had made relevant enquiries of the likely witnesses, it should not be inferred, favourably to Bombardier, that those witnesses would not attend other than under compulsion and would not agree to attend Western Australia to give evidence.[149]  The matters raised by Bombardier thus merely concerned difficulties that might arise if the proceedings were conducted in Western Australia. The mere prospect of such difficulties, not proved to be probable, provides little support for a conclusion of oppression or vexation, in the sense explained at [18] above.

    [149] Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 21 NSWLR 389, 418 (Handley JA).

23. Although not expressed as a ground of appeal, counsel for Bombardier submitted that error in the evaluation undertaken by the learned master could be inferred from his conclusion that the Supreme Court of Western Australia was not a clearly inappropriate forum, because the forum was 'so plainly inconvenient' as to be clearly inappropriate.[150]  Counsel pointed to the following factors in support of that submission: the Bombardier staff who were involved in the transactions the subject of the proceedings were now mostly ex‑employees, none of whom resided in Western Australia;[151] the key witnesses for AVW also did not reside in Western Australia, particularly as Mr Roberts now resides in New Zealand;[152] the expert witnesses were not resident in Western Australia either;[153] and the substantive law which applied to the agreements was the law of New York.[154]  In short, he submitted that the proceeding in Western Australia involved foreign law, foreign lay witnesses and foreign expert witnesses, and that Western Australia was a clearly inappropriate forum as a result.[155] Further, counsel for Bombardier submitted that the forum which was not clearly inappropriate was Canada,[156] and pointed to expert evidence to confirm that under Canadian law, the courts in Quebec had jurisdiction to deal with this dispute because Bombardier was a legal person with its head office in Montreal.[157]  He submitted that in those circumstances, Bombardier would be put to serious or unjustified trouble and harassment to litigate the proceedings in Western Australia.[158]

    [150] Appeal ts 40.

    [151] Appeal ts 42.

    [152] Appeal ts 43.

    [153] Appeal ts 42 - 43.

    [154] Appeal ts 43.

    [155] Appeal ts 43.

    [156] Appeal ts 43.

    [157] Appeal ts 44.

    [158] Appeal ts 44.

1. We are far from persuaded that an error of the kind for which Bombardier now contends has been established. In our view, it was well open to the learned master to conclude that Western Australia was not a clearly inappropriate forum, having regard to the following considerations. First, this was a case in which AVW had established a good arguable case that all of the written agreements were made in Western Australia. While it is significant that the substantive law in relation to the written agreements is the law of New York, that is not determinative against the conclusion that Western Australia is not a clearly inappropriate forum. Secondly, while there was a dispute between the parties as to the law which governed the alleged oral agreements, on AVW's case, those agreements were governed by the law of Western Australia. Thirdly, AVW's offices are based in Western Australia, and any witnesses it might wish to call are either resident in Western Australia or, at the least, there was no suggestion that they would not be willing to attend to give evidence here. Fourthly, in so far as oral evidence will be required, particularly in relation to the alleged oral agreements, there was no evidence that the witnesses Bombardier will wish to rely upon are unwilling to do so other than if compelled, or that they are not willing to attend to give evidence in Western Australia. Fifthly, even if it is necessary to compel relevant witnesses to attend to give evidence, it is possible to do so pursuant to the RSC.[159]  Sixthly, if necessary, witnesses at a trial in the Supreme Court of Western Australia may give evidence by video‑link, and there is no reason to suppose that there would be any adverse impact on the court's ability to make credibility findings were that to occur.  Seventhly, a considerable volume of the evidence at the trial will be documentary evidence.  All of these factors support the conclusion that Western Australia is not a clearly inappropriate forum for the dispute. 

   [159] Order 38A RSC.

2. On the other hand, there are clearly some factors that demonstrate a connection between the proceedings and Canada.  Bombardier is based in Canada.  Some of the witnesses it is likely to call at the trial are resident there.  According to the evidence of Professor Saumier, the courts in Quebec would have jurisdiction to deal with this dispute because Bombardier is a legal person with its head office in Montreal. 

3. It is also clear that whether the proceedings were to be conducted in Western Australia or in Canada, the expert witnesses likely to be called to give evidence in relation to the law of New York will all need to travel to give evidence, or to give evidence by video‑link. 

4. Taking into account all of these considerations, it could not be said that the continuation of the proceedings in Western Australia would be oppressive or vexatious to Bombardier.  The learned master's conclusion that Western Australia was not a clearly inappropriate forum cannot be regarded as plainly wrong, or attended by doubt so as to warrant the grant of leave to appeal.  To the contrary, even had express error been established, we would have reached the same conclusion, having regard to the considerations set out above.

5. That being the case, it cannot be said that a substantial injustice would be done if the decision of the learned master remains undisturbed.

6. Ground 4 has insufficient merit to support a grant of leave to appeal.  Were leave to appeal to be granted, ground 4 would fail.

Ground 3 and the notice of contention

1. In ground 3, the appellant contended in written submissions, in summary, that:

   (a)the learned master erred in refusing to set aside the Orders, on the basis of either or both of the matters in appeal grounds 1 and 2; and

   (b)the learned master should have set aside the order granting leave to issue and serve the writ out of the jurisdiction, and made the consequential orders sought by the appellant, on the basis of either or both of the matters in appeal grounds 1 and 2.

2. As already noted, in oral argument Bombardier conceded that ground 2 related only to discretion and so success on ground 2 could not engage ground 3.  

3. As Bombardier has not established ground 1 it is neither necessary, nor appropriate, to deal with ground 3.

4. In those circumstances it is also neither necessary nor appropriate to determine the matters raised by the Notice of Contention. 

Conclusion on leave to appeal

1. None of the grounds of appeal, individually or in combination, sustain the grant of leave to appeal.

Orders

1. For these reasons, the orders which should be made are that leave to appeal should be refused and the appeal should be dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

JM
Research Associate to the Honourable Justice Buss

10 JANUARY 2020