Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd
[2001] FCA 1833
•20 DECEMBER 2001
FEDERAL COURT OF AUSTRALIA
Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833
APPEAL – nature of and approach to appeal in Federal Court – appeal to Full Court of Federal Court of Australia is by way of rehearing not appeal stricto sensu – task of appellate court is correction of error in trial judge – need for demonstration of error – advantages of trial judge
APPEAL – limitations on raising of fresh points upon appeal and to departure from approach adopted at first instance
CONTRACT – formation – alleged lack of consensus and of intention to create legal relations – no formal or final record of actual consensus – findings of trial judge as to consensus on basis of conversations, drafts, letters – no error demonstrated
CONTRACT – pre contractual communications – parol evidence rule and “entire agreement” clauses – effect of on leading evidence to show existence of equitable estoppel
MORTGAGE – equitable mortgage – mortgage over shares existed – effect – error in judge’s decision
Federal Court of Australia Act 1976 s 27
Trade Practices Act 1974
Crown Lands Act 1931 (NT)
Pastoral Lands Act 1992 (NT)
Duralla Pty Ltd v Plant (1984) 2 FCR 342 not followed in part
Petreski v Cargill (1987) 18 FCR 68 referred to
Minister for Immigration and Ethnic Affairs v Hamsher (1992) 35 FCR 359 considered
Dynasty Pty Ltd v Coombs (1995) 59 FCR 122 referred to
Hornet Aviation Pty Ltd v Ansett Australia (1995) 16 ACSR 445 referred to
White v Minister for Immigration and Multicultural Affairs (2000) 96 FCR 511 referred to
Foyster v ANZ Banking Group Ltd [2000] FCA 1254 referred to
Sidhu v Holmes [2000] FCA 1653 referred to
H v Minister for Immigration and Multicultural Affairs (2000) 63 ALD 43 referred to
News Limited v ARL (1996) 64 FCR 410 referred to
Montgomery v FCT (1998) 152 ALR 241 referred to
Jia v Minister for Immigration and Multicultural Affairs (1999) 93 FCR 556 referred to
ACT Schools Authority v El Sheik (2000) ATR 81-557; [2000] FCA 931 referred to
Hanley v AFMEP & KIU (2000) 100 FCR 530 referred to
Heslehurst v Government of New Zealand (2001) 109 FCR 226 referred to
Williams v The Minister [2000] NSWCA 255 referred to
Stirling Harbour Services Pty Ltd & Anor v Bunbury Port Authority [2000] FCA 1381 referred to
Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267 referred to
CDJ v VAJ (1998) 197 CLR 172 referred to
Coal & Allied Operations P/L v Australian Industrial Relations Commission (2000) 74 ALJR 1348 referred to
Allesch v Maunz (2000) 173 ALR 648 referred to
Minister for Immigration and Multicultural Affairs v Jia (2001) 178 ALR 421 followed
Warren v Coombes (1979) 142 CLR 531 referred to
Cabal v United Mexican States [2001] FCA 427 followed
The Owners of the Ship ‘Shin Kobe Maru’ v Empire Shipping Company Inc (1994) 181 CLR 404 referred to
PMT Partners P/L (In Liq) v Australian National Parks and Wildlife Services (1995) 184 CLR 301 referred to
Knight v FP Special Assets (1992) 174 CLR 178 referred to
FAI General Insurance v Southern Cross Exploration NL (1988) 165 CLR 268 referred to
David Grant & Co v Westpac (1995) 184 CLR 265 referred to
Emanuele v ASC (1997) 188 CLR 114 referred to
Oshlack v Richmond River Council (1998) 193 CLR 72 referred to
Patrick Stevedores v MUA (1998) 195 CLR 1 referred to
Abebe v Commonwealth (1999) 197 CLR 510 referred to
Re JJT; Ex parte Victoria Legal Aid (1998) 195 CLR 184 referred to
Commonwealth v SCI Operations (1998) 192 CLR 285 referred to
Eastman v R (2000) 203 CLR 1 referred to
Australian Memory Pty Ltd v Brien (2000) 200 CLR 270 referred to
Crampton v R (2000) 176 ALR 369 referred to
State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In Liq) (1999) 160 ALR 588 referred to
Moneywood v Salamon Nominees (2001) 202 CLR 351 referred to
Members of the Yorta Yorta Aboriginal Community v State of Victoria (2001) 180 ALR 655 referred to
Khoo Sit Hoh v Lim Than Tong [1912] AC 323 referred to
Paterson v Paterson (1953) 89 CLR 212 referred to
Powell v Streatham Manor Nursing Home [1935] AC 243 referred to
Zuvela v Cosmarnan Concrete Pty Ltd (1996) 140 ALR 227 referred to
Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CLR 153 referred to
Fenton Nominees Pty Ltd v Valuer General (1981) 47 LGRA 71 referred to
Biogen Inc v Medeva Pty Ltd [1997] RPC 1 referred to
Whiteley Muir & Zwanenberg Ltd v Kerr (1966) 39 ALJR 505 referred to
Da Costa v Cockburn Salvage and Trading Pty Ltd (1970) 124 CLR 192 referred to
Edwards v Noble (1971) 125 CLR 296 referred to
Abalos v Australian Postal Commission (1988) 171 CLR 167 referred to
Devries v Australian National Railways Commission (1993) 177 CLR 472 referred to
S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 referred to
Turbo Tek Enterprises Inc v Sperling Enterprises Pty Ltd (1989) 23 FCR 331 referred to
Pacific Dunlop Ltd v Hogan (1989) 23 FCR 553 referred to
Allsop Inc v Bintang Ltd (1989) 15 IPR 686 referred to
Dart Industries v Decor Corporation Pty Ltd (1989) 15 IPR 403 referred to
Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90 referred to
In re Wolanski’s Registered Design (1953) 88 CLR 278 referred to
Secretary of State for Foreign Affairs v Charlesworth, Pilling & Co [1901] AC 363 referred to
Commissioner of Taxation v Chubb Australia (1995) 56 FCR 557 referred to
Australian Broadcasting Commission v XIVth Commonwealth Games (1988) 18 NSWLR 540 referred to
GR Securities v Baulkham Hills Private Hospital (1986) 40 NSWLR 631 referred to
Howard Smith and Company Limited v Varawa (1907) 5 CLR 68 referred to
Seppelt and Sons Ltd v Commissioner for Main Roads (1975) 1 BPR 9147 referred to
Geebung Investments v Varga Investments (1995) 7 BPR 14 referred to
Pirt Biotechnologies v Pirtferm Pty Limited [2001] WASCA 96 referred to
Suttor v Gundowda (1950) 81 CLR 418 referred to
Coulton v Holcombe (1986) 162 CLR 1 applied
University of Wollongong v Metwally [No 2] (1985) 60 ALR 68 referred to
O’Brien v Komesaroff (1982) 150 CLR 310 referred to
Water Board v Moustakas (1988) 180 CLR 491 referred to
Connecticut Fire Insurance v Kavanagh [1892] AC 473 referred to
Liftronic Pty Ltd v Unver (2001) 179 ALR 321 referred to
Kweifio-Okai v RMIT University [1999] FCA 1686 referred to
Davison v Vickery’s Motors Ltd (In Liquidation) (1925) 37 CLR 1 referred to
JB Chandler Investment Co Ltd (In voluntary liquidation) v Comm of Taxation (1993) 47 FCR 588 referred to
Jones v Minister for Immigration and Ethnic Affairs (1995) 63 FCR 32 referred to
Gordon v McGregor (1909) 8 CLR 316 referred to
Major v Bretherton (1928) 41 CLR 62referred to
Nemeth v Bayswater Road Pty Ltd [1988] 2 Qd R 406 referred to
State Rail Authority of NSW v Heath Outdoor Pty Ltd (1986) 7 NSWLR 170considered
NSW Cancer Council v Sarfaty (1992) 28 NSWLR 68 referred to
Secured Income Real Estate (Australia) v St Martins Investments Pty Ltd (1979) 144 CLR 596referred to
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337referred to
Bahr v Nicolay (No 2) (1988) 164 CLR 604referred to
Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd (1992) 27 NSWLR 326 referred to
Saad v TWT Limited [1998] NSWSC 282 referred to
Norwest Beef Industries Limited v Peninsular & Oriental Steam Navigation Co (1987) 8 NSWLR 568 referred to
Bell v Queensland Design Pty Limited [1994] QSC 9 referred to
MacDonald v Shinko Australia Pty Limited [1999] 2 Qd R 152 referred to
Agseed Pty Limited v Broad [1991] SASC 2880 referred to
Bruce v AWB Limited [2000] FCA 594 referred to
Major v Bretherton (1928) 41 CLR 62 referred to
Hoyt’s Proprietary Ltd v Spencer (1919) 27 CLR 133 referred to
B Seppelt and Sons Ltd v Commissioner for Main Roads (1975) 1 BPR 9147 referred to
Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 referred to
Twynam Pastoral Company Pty Ltd v Anburn Pty Ltd (1989) 6 BPR 13 referred to
Harold v Plenty [1901] 2 Ch 314 referred to
UTC Ltd v NZI Securities (1991) 4 WAR 349 referred to
Wise v Lansdell [1921] 1 Ch 420 referred to
Eccles v Bryant [1948] Ch 93 referred to
Allen v Carbone (1975) 132 CLR 528 referred to
Summit Properties v Comserv (No 784) Pty Ltd (1981) 2 BPR 9173 referred to
Sindel v Georgiou (1984) 154 CLR 661 referred to
Baulkham Hills Hospital v G R Securities (1996) 40 NSWLR 622 referred to
Meates v A-G [1983] NZLR 308 referred to
Integrated Computer Services Pty Ltd v Digital Equipment Corp Pty Ltd (1988) 5 BPR [97,326] referred to
Vroon BV v Fosters Brewing Group [1994] 2 VR 32 referred to
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523 referred to
Pagnan SpA v Feed Products [1987] 2 Lloyd’s Rep 601 referred to
Pobjie Agencies v Vinidex Tubemakers [2000] NSWCA 105 referred to
Brambles Holdings Limited v Bathurst City Council [2001] NSWCA 61 referred to
Toyota Motor Corporation Australia Ltd v Ken Morgan [1994] 2 VR 106 referred to
Electrical Enterprises Retail Pty Ltd v Rodgers (1989) 5 NSWLR 473 referred to
Manzi v Smith (1975) 132 CLR 671 referred to
Film Bars v Pacific Film Laboratories (1979) 1 BPR 9251 referred to
State Bank of New South Wales v Commonwealth Savings Bank (1985) 60 ALR 73 referred to
Byrne v Australian Airlines Limited (1985) 185 CLR 410 referred to
First Energy (UK) Ltd v Hungarian International Bank Ltd [1993] 2 Lloyd’s Law Rep 194 referred to
Macdonald v Longbottom (1859) 1 E&E 977; 120 ER 1177 referred to
Prenn v Simmonds [1971] 1 WLR 1381 referred to
Reardon Smith Line v Hansen-Tangen [1976] 1 WLR 989 referred to
Utica City National Bank v Gunn (1918) 118 NE 607; 222 NY 204 referred to
Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 referred to
Grant v John Grant & Sons (1954) 91 CLR 112 referred to
Dent v Moore (1919) 26 CLR 316 referred to
Hart v Macdonald (1910) 10 CLR 417 referred to
Australian Co-Operative Foods Ltd v Norco (1999) 46 NSWLR 267 referred to
Johnson Matthey v AC Rochester Overseas (1990) 23 NSWLR 190 referred to
Bentham v ANZ (unreported, Supreme Court of NSW, 26 June 1991) referred to
Skywest Aviation Pty Ltd v Commonwealth (1995) 126 FLR 61 referred to
Public Trustee for the ACT v Megic (1995) 59 FCR 165 referred to
New Holland Mining v Weaver Oil and Gas Corp Aust Ltd (unreported, Supreme Court of WA, 12 March 1998) referred to
Seabridge Australia Pty Ltd v JLW (1991) 29 FCR 415 referred to
Cafdawn Pty Limited v Waltons Stores Ltd (unreported, Federal Court of Australia, 28 March 1991) referred to
Byers v Dorotea (1986) 69 ALR 715 referred to
Grundt v Great Boulder Pty Gold Mines Limited (1937) 59 CLR 641 referred to
Bank Negara Indonesia v Philip Hoalim [1973] 2 MLJ 3 referred to
Lezam Pty Ltd v Seabridge Australia Pty Ltd (1992) 35 FCR 535 referred to
Whittet v State Bank of NSW (1991) 24 NSWLR 146 referred to
Liangis Investments Pty Ltdv Daplyn Pty Limited (1994) 117 FLR 28 referred to
Grace v Peter Harrison Designs & Signs Pty Ltd [1998] QSC 27 referred to
Riches v Hogben [1995] 2 Qd R 292 referred to
Giumelli v Giumelli (1999) 196 CLR 101 referred to
Nelson v Nelson (1995) 184 CLR 538 referred to
Fitzgerald v Leonhardt (1997) 143 ALR 569 referred to
Yango Pastoral Co Pty Ltd v First Chicago Australia (1978) 139 CLR 410 referred to
Roach v Bickle (1915) 20 CLR 663 referred to
Massart v Blight (1951) 82 CLR 423 referred to
Brown v Heffer (1967) 116 CLR 344 referred to
Coote A Treatise on the Law of Mortgages (7th Ed) vol 1
White and Tudor’s Leading Cases in Equity (9th Ed) vol 2
Story’s Equity Jurisprudence (6th Ed) Vol 2 [1020]
Fisher and Lightwood’s Law of Mortgages (Aust Ed)
Chitty on Contracts 26th Edition [854]
Derham “Estoppel by Convention” (1997) 71 ALJ 860
Finn “Equitable Estoppel”, Essays in Equity (1985)
Lang Leases and Tenancies in NSW (1976)
Branir Pty Ltd and Others v Owston Nominees and Another
N1120 and N1121 of 2000DRUMMOND, MANSFIELD & ALLSOP JJ
20 DECEMBER 2001
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N 1120 of 2000
and N 1121 of 2000ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
BRANIR PTY LTD (ACN 061 718 876)
FIRST APPELLANT and FIRST CROSS RESPONDENTTOVEHEAD PTY LIMITED (ACN 003 745 140)
SECOND APPELLANT and SECOND CROSS RESPONDENTABURIZAL BAKRIE
THIRD APPELLANT and THIRD CROSS RESPONDENTAND:
OWSTON NOMINEES NO2 PTY LIMITED (ACN 001 769 099)
FIRST RESPONDENT and FIRST CROSS APPELLANTWARREN PERRY ANDERSON
SECOND RESPONDENT and SECOND CROSS APPELLANTJUDGES:
DRUMMOND, MANSFIELD and ALLSOP JJ
DATE OF ORDER:
20 DECEMBER 2001
PLACE:
SYDNEY
The Court orders:
In respect of the appeal (N 1121 of 2000):
1.that subject to order 2 below the appeal be dismissed;
2.that declaration 3(b) made by the primary judge to the effect that “the first respondent is to be debt free on the issue of the Shares” be varied by adding thereafter the words: “subject to such obligations or debts, if any, as arise or may arise from any undertaking by the first appellant, Branir Pty Limited then known as Votraint No 788 Pty Limited, in the letter of 22 December 1993 which was signed by Mr Nalin Rathod on behalf of the first appellant, and a copy of which was annexure D to the affidavit of Mr Arthur Dew sworn 27 September 1997.”; and
3.that the appellants pay the respondents’ costs.
In respect of the cross appeal (appeal N 1120 of 2000):
1.that the appeal be allowed;
2.that declaration 1(a) made by the primary judge be varied to substitute for the words “for the life of the second applicant” the words “in perpetuity”; and
3.that the respondents pay the appellants’ costs.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N 1120 of 2000
and N 1121 of 2000ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
BRANIR PTY LTD (ACN 061 718 876)
FIRST APPELLANT and FIRST CROSS RESPONDENTTOVEHEAD PTY LIMITED (ACN 003 745 140)
SECOND APPELLANT and SECOND CROSS RESPONDENTABURIZAL BAKRIE
THIRD APPELLANT and THIRD CROSS RESPONDENTAND:
OWSTON NOMINEES NO2 PTY LIMITED (ACN 001 769 099)
FIRST RESPONDENT and FIRST CROSS APPELLANTWARREN PERRY ANDERSON
SECOND RESPONDENT and SECOND CROSS APPELLANT
JUDGE:
DRUMMOND, MANSFIELD and ALLSOP JJ
DATE:
20 DECEMBER 2001
PLACE:
SYDNEY
REASONS FOR JUDGMENT
DRUMMOND J:
I agree with Allsop J’s reasons and with the order he proposes in relation to the appeal and the cross-appeal.
I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice Drummond. Associate:
Dated: 20 December 2001
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N 1120 of 2000
and N 1121 of 2000ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
BRANIR PTY LTD (ACN 061 718 876)
FIRST APPELLANT and FIRST CROSS RESPONDENTTOVEHEAD PTY LIMITED (ACN 003 745 140)
SECOND APPELLANT and SECOND CROSS RESPONDENTABURIZAL BAKRIE
THIRD APPELLANT and THIRD CROSS RESPONDENTAND:
OWSTON NOMINEES NO2 PTY LIMITED (ACN 001 769 099)
FIRST RESPONDENT and FIRST CROSS APPELLANTWARREN PERRY ANDERSON
SECOND RESPONDENT and SECOND CROSS APPELLANT
JUDGE:
DRUMMOND, MANSFIELD and ALLSOP JJ
DATE:
20 DECEMBER 2001
PLACE:
SYDNEY
REASONS FOR JUDGMENT
MANSFIELD J:
I have had the benefit of reading the judgment about to be delivered by Allsop J. I agree with his Honour’s reasons and the orders he proposes.
I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice Mansfield. Associate:
Dated: 20 December 2001
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
N 1120 of 2000
and N 1121 of 2000ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
BETWEEN:
BRANIR PTY LTD (ACN 061 718 876)
FIRST APPELLANT and FIRST CROSS RESPONDENTTOVEHEAD PTY LIMITED (ACN 003 745 140)
SECOND APPELLANT and SECOND CROSS RESPONDENTABURIZAL BAKRIE
THIRD APPELLANT and THIRD CROSS RESPONDENTAND:
OWSTON NOMINEES NO2 PTY LIMITED (ACN 001 769 099)
FIRST RESPONDENT and FIRST CROSS APPELLANTWARREN PERRY ANDERSON
SECOND RESPONDENT and SECOND CROSS APPELLANT
JUDGE:
DRUMMOND, MANSFIELD and ALLSOP JJ
DATE:
20 DECEMBER 2001
PLACE:
SYDNEY
REASONS FOR JUDGMENT
ALLSOP J :
Index
Introduction [ 4 ] – [ 10 ]
The Approach on Appeal [ 11 ] – [ 39 ]
The Issues Below [ 40 ] – [ 79 ]
The Sanctuary Agreement [ 45 ] – [ 58 ]
The Share Agreement [ 59 ] – [ 72 ]
The Conduct of the Hearing [ 73 ] – [ 79 ]
The Facts [ 80 ] – [ 216 ]
The Narrative up to 23 December 1993 [ 80 ] – [ 187 ]
The Finalisation of the Share Letter on 23 December [ 188 ] – [ 194 ]
The Finalisation of the Sanctuary Letter on 23 December [ 195 ] – [ 198 ]
Settlement and the Beliefs of Mr Dew and Mr Anderson
at Settlement [ 199 ] – [ 204 ]
The Questions of Consensus and Intention to be Bound [ 205 ] – [ 212 ]
Events after 23 December 1993 [ 213 ] – [ 216 ]
The Findings of the Primary Judge [ 217 ] – [ 249 ]
The Share Agreement [ 217 ] – [ 226 ]
The Sanctuary Agreement [ 227 ] – [ 239 ]
Estoppel and Misleading or Deceptive Conduct [ 240 ] – [ 249 ]
Orders Made by the Primary Judge [ 250 ]
The Appeal [ 251 ] – [ 464 ]
Fundamental Background to the Appeal - Pressure on
Anderson, Settlement Complexity and General Preparatory Remarks [ 252 ] – [ 259 ]
The Shareholding Agreement [ 260 ] – [ 358 ]
No consideration [ 262 ] – [ 269 ]
The Form of the Acceptance of Offer [ 270 ] – [ 274 ]
The Methodology of the Primary Judge [ 275 ] – [ 276 ]
The Parole Evidence Rule [ 277 ] – [ 297 ]
Alleged Illegitimate Use of Subjective Intention [ 298 ] – [ 300 ]
Alleged Lack of Intention to Enter Legal Relations [ 301 ] – [ 309 ]
Alleged Lack of Consensus [ 310 ] – [ 332 ]
Alleged Uncertainty of the Share Agreement [ 333 ] – [ 337 ]
The Effect of the Deposit of the Share Scrip [ 338 ] – [ 345 ]
Alleged Failure of the Applicants to do Equity [ 346 ] – [ 347 ]
The Indonesian Deposit Rate, Uncertainty and the
Application to Reopen Rejected by the Primary Judge [ 348 ] – [ 358 ]
The Sanctuary Agreement [ 359 ] – [ 405 ]
Alleged Lack of Consensus and of
Intention to Create Legal Relations [ 361 ] – [ 405 ]
Postscript on Consensus and Intention to Create Legal Relations and
Appellate Approach [ 406 ] – [ 412 ]
The Settlement Deed and the Sanctuary Agreement[ 413 ] – [ 450 ]
The Settlement Deed and the Share Agreement [ 451 ] – [ 452 ]
Estoppel [ 453 ] – [ 458 ]
Misleading or Deceptive Conduct [ 461 ] – [ 464 ]The Cross Appeal and The Effect of the Crown Land Legislation on
the Sanctuary Agreement [ 465 ] – [ 501 ]
Proposed Orders [ 502 ] – [ 503 ]Introduction
This matter involves two appeals from a Judge of the Court concerning two aspects of a body of commercial dealings between the relevant parties. Each of those aspects involves the examination as to whether the primary judge was correct in finding an enforceable contract between the parties. The main appeal, N 1121 of 2000, is brought by Branir Pty Limited, Tovehead Pty Limited and Mr Aburizal Bakrie. I will refer to this as the appeal and these parties as the appellants. In appeal N 1120 of 2000, the respondents to N 1121 of 2000, Owston Nominees No 2 Pty Limited and Mr Warren Anderson, appeal against one aspect of the orders of the primary judge. I will refer to this as the cross appeal and to these parties either by name or as the applicants when referring to the proceedings below.
Briefly by way of introduction, and perhaps over simply, in the years leading up to 1993 Mr Warren Anderson, an Australian businessman and Mr Aburizal Bakrie, an Indonesian businessman, through their respective entities, had taken interests in a large cattle station in the north of Australia called “Tipperary”. Its title was held in part under pastoral leases under Northern Territory legislation. Until it becomes relevant I will ignore the leasehold nature of the interests held by the parties. The property supplied live cattle to a business in Indonesia which ran a commercial feedlot in which Messrs Anderson and Bakrie, along with others, were interested. Unrelated to the commercial operation of the cattle station there had been created on Tipperary an exotic wildlife sanctuary for the preservation and study of endangered species. I will refer to it as the Sanctuary. The Sanctuary appears to have been an undertaking reflecting, and giving expression to, Mr Anderson’s personal interest in such activities. Its development began prior to Mr Bakrie and entities associated with him taking a commercial interest in Tipperary. From time to time I will refer to the ‘Sanctuary’ and the ‘Sanctuary land’. Until it becomes relevant to my discussion in [463] and following paragraphs of the form of the order made by the primary judge no particular significance should be attached to the choice of either of these two expressions.
By early 1993, Mr Anderson and his commercial interests were under intense pressure from a major lender, the Bank of New York (to which I will refer as BNY, indiscriminately as to corporate entities reflecting the bank’s manifestation). At the end of 1993 steps were taken which enabled Mr Anderson and his interests to repay BNY. Those steps involved the re-arrangement of the interests of Mr Anderson and Mr Bakrie and of entities with which they were associated. On 23 December 1993 a number of documents were executed and exchanged at a long and complex settlement. The effectuation of the settlement on that day saw BNY paid out and the threat of receiver sales of, amongst other things, Tipperary, recede.
The case before the primary judge, and the appeal, involved two matters as between Mr Anderson and Mr Bakrie and their interests which were not satisfactorily reduced to detailed written expression in formal deeds or agreements or documents the form of which was otherwise clearly agreed on or before 23 December 1993, as most other aspects of the re-arrangement were.
These two matters were whether relevant parties had agreed, in a manner intended to have legal effect, first, that there would be issued to Mr Anderson’s family trust company, Owston Nominees No 2 Pty Limited (Owston), a little over 40% of the shares in the first appellant (Branir Pty Limited, at that time known as Votraint No 788 Pty Limited and to which I will refer either as Votraint or Branir) which, after the main settlement, was to own, directly or indirectly, half Tipperary and half the feedlot; and, secondly, that Owston would be entitled to, in effect, a sub-lease of the land upon which the Sanctuary was situated and surrounding areas up to, in total, 20,000 acres within Tipperary, free of any interest of Mr Bakrie or his entities.
The primary judge found, in relation to both aspects, in favour of Mr Anderson’s interests.
The hearing before his Honour was a long one. Mr Anderson gave evidence. Mr Bakrie gave evidence. The subordinates and confidants of each gave evidence. His Honour made findings of credit, in strong terms. It will be necessary to return to these findings in a little detail later, but it suffices, for present purposes, to appreciate that his Honour rejected much of the evidence given by Mr Bakrie and his subordinates and confidants and accepted the evidence of Mr Anderson and his subordinates and confidants, especially, relevantly, Mr Dew.
The Approach on Appeal
Except in limited respects, no attempt was made by the appellants to challenge the findings made by the primary judge based on his view of the witnesses. Rather, the approach of the appellants was to accept those findings (with the limited exceptions) and, in the light of them, and on the version of events deposed to by Mr Anderson and Mr Dew, to seek to persuade the Court on appeal that findings should be made which would lead to the appeal being allowed.
There was debate during the appeal as to whether the appellants were adopting an impermissible approach in the way they were approaching the primary judge’s fact finding and the role of the Court on appeal. In light of that debate, I express my views on the approach which I see as appropriate.
Appeals to this Court are governed by Division 2 of Part III of the Federal Court of Australia Act 1976. It was held in Duralla Pty Ltd v Plant (1984) 2 FCR 342 that appeals to this Court are in the nature of appeals stricto sensu, and not by way of rehearing. (I acknowledge the absence of precision of the expression “by way of rehearing”. However, for the purposes of discussion in these reasons, and in particular, in contradistinction to the type of hearing referred to in Duralla, it is, I think, uncontroversial to use the phrase.) Duralla has been followed or applied on many occasions: see, for example, Petreski v Cargill (1987) 18 FCR 68 at 77 to 78; Minister for Immigration and Ethnic Affairs v Hamsher (1992) 35 FCR 359 at 369; Dynasty Pty Ltd v Coombs (1995) 59 FCR 122 at 129; Hornet Aviation Pty Ltd v Ansett Australia (1995) 16 ACSR 445 at 450; White v Minister for Immigration and Multicultural Affairs (2000) 96 FCR 511 at [19]; Foyster v ANZ Banking Group Ltd [2000] FCA 1254 at [16]; Sidhu v Holmes [2000] FCA 1653 at [5]; and H v Minister for Immigration and Multicultural Affairs (2000) 63 ALD 43 at [6].
Most of these decisions dealt with the question of the proper extent of s 27 of the Federal Court Act and the admission of further evidence on appeal. However, Hamsher, supra, in dealing with Duralla, did so in the context of a discussion of the proper approach to an appeal in this Court. Beaumont J and Lee J said at 369, after setting out s 27:
However, the hearing of an appeal in this Court is neither a trial de novo nor a trial of the case afresh on the record (Duralla Pty Ltd v Plant (1984) 2 FCR 342) and the court is not obliged to proceed to make new findings of fact on all relevant issues and discharge the judgment appealed from if those findings differ from those of the trial judge and do not support the judgment. The Court must be satisfied that the judgment of the trial judge is erroneous and it may be so satisfied if it reaches the conclusion that the trial judge failed to draw inferences that should have been drawn from the facts established by the evidence. The court is unlikely to be so satisfied if all that is shown is that the trial judge made a choice between competing inferences, being a choice the court may not have been inclined to make but not a choice the trial judge should not have made. Where the majority judgment in Warren v Coombes (supra) (at 552-553) states that an appellate court must not shrink from giving effect to its own conclusion, it is speaking of a conclusion that the decision of the trial judge is wrong and that it should be corrected. (See also Edwards v Noble (1971) 125 CLR 296, per Barwick CJ (at 304), per Menzies J (at 308-309) and per Walsh J (at 318-319).)
The approach to appeals in this Court set out in Hamsher has been followed on a number of occasions in the Court: eg News Limited v ARL (1996) 64 FCR 410 at 423 – 24; Montgomery v FCT (1998) 152 ALR 241 at 256; Jia v Minister for Immigration and Multicultural Affairs (1999) 93 FCR 556 at 569; ACT Schools Authority v El Sheik (2000) ATR 81-557; [2000] FCA 931 at [31]; Hanley v AFMEP & KIU (2000) 100 FCR 530 at 534 – 35; H v Minister for Immigration and Multicultural Affairs, supra, at [11]; Sidhu v Holmes, supra, at [8] and Heslehurst v Government of New Zealand (2001) 109 FCR 226 at [26]. It has been applied by the Court of Appeal of New South Wales in Williams v The Minister [2000] NSWCA 255.
The correctness of Duralla, that the appeal to this Court is one stricto sensu, has recently been questioned by Burchett J and Hely J (with whom Carr J agreed on this question) in Stirling Harbour Services Pty Ltd & Anor v Bunbury Port Authority [2000] FCA 1381 at [75]-[79] (and [115]). Their Honours noted that since Duralla there had been two decisions of the High Court upon the basis of which an attack on the reasoning in Duralla could be mounted, they being Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267 in which powers conferred on an appellate tribunal to “make such orders as it thinks fit” (compare s 28, especially para 28(1)(b) of the Federal Court Act) and to “take further evidence for the purposes of an appeal under this section” (compare s 27 of the Federal Court Act) were held by Deane J, Gaudron J and McHugh J at p 272 to be “strong indications that the appeal… was by way of rehearing”; and CDJ v VAJ (1998) 197 CLR 172 in which McHugh J, Gummow J and Callinan J at p 199 described s 27 of the Federal Court Act and s 93A(2) of the Family Law Act 1975 as “similar” and at pp 201-2 described an appeal to the Full Court of the Family Court as an appeal by way of rehearing. To these references there can now be added the views of Gleeson CJ, Gaudron J and Hayne J in Coal & Allied Operations P/L v Australian Industrial Relations Commission (2000) 74 ALJR 1348 at [17], describing an appeal to the Full Bench of the Industrial Relations Commission as by way of rehearing “[b]ecause… the Commission has power under s 45(6) of the Act to receive further evidence on appeal.”; and the views of Gaudron J, McHugh J, Gummow J and Hayne J in Allesch v Maunz (2000) 173 ALR 648 at [20] to [24] dealing with appeals to the Full Court of the Family Court.
In Minister for Immigration and Multicultural Affairs v Jia (2001) 178 ALR 421 at [75] Gleeson CJ and Gummow J said that an appeal to the Full Court of this Court from a single judge was by way of rehearing. They noted that it was agreed before them that the relevant principles as to reviewing a primary judge’s findings of fact were as stated in Warren v Coombes (1979) 142 CLR 531. Kirby J noted that both sides in the appeal agreed that the past authority of the Federal Court concerning the nature of an appeal (referring, I take it, to Duralla and cases following it) was erroneous. Kirby J did not demur to that. This agreement of counsel reflected the views of Gleeson CJ and Gummow J. Hayne J (at [176]) agreed with the reasons of Gleeson CJ and Gummow J for allowing the appeal. Callinan J did not deal with the point.
In Cabal v United Mexican States [2001] FCA 427 at [222] the Full Court of this Court, in a judgment of the Court referring to Jia in the High Court, said that appeals in this Court were by way of rehearing. This was directly contrary to Duralla. I take it as a decision rejecting Duralla .
Burchett J and Hely J in Stirling Harbour Services, supra, in this context, also referred to the expression of view in the High Court that provisions conferring judicial power upon courts should be construed liberally eschewing limitations and implications not found in the words of the statute: CDJ v VAJ, supra at 201, The Owners of the Ship ‘Shin Kobe Maru’ v Empire Shipping Company Inc (1994) 181 CLR 404 at 421 and PMT Partners P/L (In Liq) v Australian National Parks and Wildlife Services (1995) 184 CLR 301 at 313 and 316. To these references can be added Knight v FP Special Assets (1992) 174 CLR 178 at 205; FAI General Insurance v Southern Cross Exploration NL (1988) 165 CLR 268 at 290; David Grant & Co v Westpac (1995) 184 CLR 265 at 275-76; Emanuele v ASC (1997) 188 CLR 114 at 136-37; Oshlack v Richmond River Council (1998) 193 CLR 72 at 81; Patrick Stevedores v MUA (1998) 195 CLR 1 at 56-7; Abebe v Commonwealth (1999) 197 CLR 510 at 586-87; Re JJT; Ex parte Victoria Legal Aid (1998) 195 CLR 184 at 201; Commonwealth v SCI Operations (1998) 192 CLR 285 at 301; Eastman v R (2000) 203 CLR 1 at [81]; and Australian Memory Pty Ltd v Brien (2000) 200 CLR 270 at [17]. This body of authority tends strongly against the more limited conception of appeal as laid down in Duralla.
The question whether the appeal to this Court is one stricto sensu, in accordance with Duralla, or is by way of rehearing, was not put forward by the parties as an issue necessary to answer. The matter was not approached by the parties before us on the basis that the correct approach to the appeal required us to decide the correctness of Duralla or on the basis of the incorrectness of the proposition that the approach of Beaumont J and Lee J in Hamsher, supra, in the requirement for the demonstration of error is one which is appropriate for appeals both in the strict sense and by way of rehearing. (I note that the New South Wales Court of Appeal, conducting an appeal by way of rehearing in Williams v The Minister, supra, applied Hamsher.) However, in the light of Cabal it is appropriate for me to express my view that the weight of High Court authority dealing with provisions governing appeals in other courts similar to ss 27 and 28 of the Federal Court Act and dealing with the requirement to read provisions conferring judicial power liberally and in particular, most recently, the views of at least three (if not four) of the members of the High Court in Jia dealing with appeals in this Court lead to the conclusion that appeals to this Court are by way of rehearing. Cabal is correct and Duralla should not be followed on this point. I approach the matter on the basis that the appeal is one by way of rehearing.
However, this conclusion does not alter the need to show error on appeal. In Hamsher Beaumont J and Lee J identified the need for the demonstration of error in the trial judge’s findings or conclusions and they expressed the view that the statements in Warren v Coombes (1979) 142 CLR 531 (dealing with an appeal by way of rehearing) that an appellate court must not shrink from giving effect to its own conclusion were premised on a conclusion that the decision of the trial judge was wrong and should be corrected.
In any event, it is plain from what the High Court has said in CDJ v VAJ supra at [111], in Allesch v Maunz, supra at [22], in Coal & Allied Operations v AIRC, supra at [14] and in Crampton v R (2000) 176 ALR 369 at [147] (citing Attorney General v Sillem (1864) 10 HLC 704 at 724 per Lord Westbury LC and Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 109 per Dixon J) that the task of a court on an appeal by way of rehearing is the correction of error.
In Cabal, supra at [223] and [224] the Court said:
[223]The principles which govern the review by a Full Court of primary judge’s findings of fact are as stated in Warren v Coombes (1979) 142 CLR 531. See also Abalos v Australian Postal Commission (1988) 171 CLR 167; Devries v Australian National Railways Commission (1933) 177 CLR 472; and State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (in liq) (1999) 160 ALR 588. In general on an appeal by way of rehearing from a judge sitting without a jury an appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge. In deciding what is the proper inference to be drawn, the appellate court will give respect and weight to the conclusion of the trial judge. However once having reached its own conclusion it will not shrink from giving effect to it.
[224]Notwithstanding the fact that the learned primary judge’s review was conducted on the papers, and without any opportunity to consider the demeanour of the witnesses, the weight to be accorded to the evidence of the experts was primarily a matter for his Honour to determine. This Court can consider whether he fell into appealable error in that regard but it will not approach that evidence as though this were a rehearing de novo in which his Honour’s views count for nought. If, after giving full weight to his Honour’s views, we are persuaded that the conclusions which he reached were erroneous we must set aside his finding of fact. We cannot however simply substitute for his Honour’s findings of fact those findings which we would have made had we been the judges on review who determined this matter at first instance.
What is error in any given case depends, of course, not only on the evidence, but also on the nature of the findings or conclusions made by the primary judge. The demonstration of error may not be straight-forward where findings or conclusions involve elements of fact, degree, opinion or judgment or when the findings or conclusions in question can be seen as made with the advantage of hearing the evidence in its entirety, presented as it unfolded at the hearing with the opportunity over the course of the hearing and adjournments for reflection and mature contemporaneous consideration and assessment, in particular in a long and complex hearing: see State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In Liq) (1999) 160 ALR 588 at 619 [90] per Kirby J; Moneywood v Salamon Nominees (2001) 202 CLR 351 at 390 [127] and [128] per Kirby J; Members of the Yorta Yorta Aboriginal Community v State of Victoria (2001) 180 ALR 655 at [203] and [205] per Branson J and Katz J; and also Khoo Sit Hoh v Lim Than Tong [1912] AC 323, 325; Paterson v Paterson (1953) 89 CLR 212, 221; Powell v Streatham Manor Nursing Home [1935] AC 243; and Warren v Coombes, supra at 538.
This is not to elevate ordinary factual findings to the protected position of those based on credit, but it is to make clear, first, the advantages of the trial judge and, secondly, the need for demonstration of error. The inability to identify error may arise in part from the unwillingness of the appeal court to be persuaded that it is in as good a position as the trial judge to deal with the issues, because of the kinds of considerations referred to in [24] above. Or, it may be that the nature of the issue is one such that (though not a discretion) there cannot be said to be truly one correct answer. In such cases the availability of a different view, indeed even perhaps the preference of the appeal court for a different view, may not be alone sufficient: see Zuvela v Cosmarnan Concrete Pty Ltd (1996) 140 ALR 227 at 229-30. In circumstances where, by the nature of the fact or conclusion, only one view is (at least legally) possible (for example, the proper construction of a statute or a clause in a document, where, although, as often said, minds might differ about such matters of construction, there can be but one correct meaning: see generally Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CLR 135, 151-56) the preference of the appeal court for one view would carry with it the conclusion of error. However, other findings and conclusions may be far more easily open to legitimate differences of opinion eg valuation questions, see Fenton Nominees Pty Ltd v Valuer-General (1981) 47 LGRA 71, 73-76.
Where parties do not finally record their bargain in a formal document but, perforce of circumstance, leave the state of their communings as a mixture of conversations (between different people), letters and drafts, the findings and conclusions of the trial judge as to what was agreed (in the sense of consensus) and whether or not such agreement was intended to be legally binding may well be ones reached with all the advantages referred to by, amongst others, Kirby J in SRA v Earthline, supra, and perhaps with the advantage of seeing and assessing the witnesses. Such findings and conclusions are the very kind of assessments to which the words of Lord Hoffmann in Biogen Inc v Medeva Pty Ltd [1997] RPC 1 at 45 (cited with approval by Heydon JA in Williams, supra) are especially apposite:
The need for appellate caution in reversing the judge’s evaluation of the facts is based upon much more solid grounds than professional courtesy. It is because specific findings of fact, even by the most meticulous judge, are inherently an incomplete statement of the impression which was made upon him by the primary evidence. His expressed findings are always surrounded by a penumbra of imprecision as to emphasis, relative weight, minor qualification and nuance (as Renan said, la [vérité] est dans une nuance), of which time and language do not permit exact expression, but which may play an important part in the judge’s overall evaluation.
However, as was made clear in Cabal, this Court is bound to deal with the appeal as directed by Warren v Coombes, supra.
The views of Barwick CJ in cases such as Whiteley Muir & Zwanenberg Ltd v Kerr (1966) 39 ALJR 505, 506, Da Costa v Cockburn Salvage and Trading Pty Ltd (1970) 124 CLR 192, 199 and Edwards v Noble (1971) 125 CLR 296, 304 which were rejected by the majority in Warren v Coombes, supra, and the views of that majority in Warren v Coombes all contain the need for the demonstration of error. The need for demonstration of error and how that fits into the appropriate approach to dealing with the appeal is reflected in what Menzies J and Walsh J said in Edwards v Noble, supra, where their Honours expressed views to a degree contrary to those of Barwick CJ. The views of Menzies J and Walsh J are set out in Warren v Coombes at 545-47. They were views approved of in Warren v Coombes. From Warren v Coombes, the passages of Menzies J and Walsh J in Edwards v Noble, from the other authority cited by the majority in Warren v Coombes and from more recent decisions of the High Court flow a number of relevant propositions. First, the appeal court must make up its own mind on the facts. Secondly, that task can only be done in the light of, and taking into account and weighing, the judgment appealed from. In this process, the advantages of the trial judge may reside in the credibility of witnesses, in which case departure is only justified in circumstances described in Abalos v Australian Postal Commission (1988) 171 CLR 167; Devries v Australian National Railways Commission (1993) 177 CLR 472 and SRA v Earthline, supra. The advantages of the trial judge may be more subtle and imprecise, yet real, not giving rise to a protection of the nature accorded credibility findings, but, nevertheless, being highly relevant to the assessment of the weight to be accorded the views of the trial judge. Thirdly, while the appeal court has a duty to make up its own mind, it does not deal with the case as if trying it at first instance. Rather, in its examination of the material, it accords proper weight to the trial judge’s views. Fourthly, in that process of considering the facts for itself and giving weight to the views of, and advantages held by, the trial judge, if a choice arises between conclusions equally open and finely balanced and where there is, or can be, no preponderance of view, the conclusion of error is not necessarily arrived at merely because of a preference of view of the appeal court for some fact or facts contrary to the view reached by the trial judge.
The degree of tolerance for any such divergence in any particular case will often be a product of the perceived advantage enjoyed by the trial judge. Sometimes, where matters of impression and judgment are concerned, giving “full weight” or “particular weight” to the views of the trial judge might be seen to shade into a degree of tolerance of divergence of views: compare S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466, 478 and 491; Turbo Tek Enterprises Inc v Sperling Enterprises Pty Ltd (1989) 23 FCR 331; Pacific Dunlop Ltd v Hogan (1989) 23 FCR 553; Allsop Inc v Bintang Ltd (1989) 15 IPR 686; Dart Industries v Decor Corporation Pty Ltd (1989) 15 IPR 403, 412; and Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90 at [27]. In such cases the personal impression or conception of the trial judge may be one not fully able to be expressed or reasoned: see for example In re Wolanski’s Registered Design (1953) 88 CLR 278, 281 and Secretary of State for Foreign Affairs v Charlesworth, Pilling & Co [1901] AC 363, 391. However, as Hill J said in Commissioner of Taxation v Chubb Australia (1995) 56 FCR 557, 573 “giving full weight” to the view appealed from should not be taken too far. The appeal court must come to the view that the trial judge was wrong in order to interfere. Even if the question is one of impression or judgment, a sufficiently clear difference of opinion may necessitate that conclusion.
From these principles of how the appeal court should undertake its task, the following can be said about the approach of those conducting an appeal. The proper approach is not to ask the court to survey all the evidence, directed by the otherwise unassailable findings on credit, and to ask it to arrive at its own conclusions, without “essaying the necessary task of positively demonstrating that the trial judge was wrong”: Williams v The Minister, supra at [61] per Heydon JA. It is not appropriate to treat the appeal as though it were a new trial on the evidence and constrained merely by the unassailable factual findings. Error must be demonstrated. See also Biogen Inc v Medeva Pty Ltd, supra at 45 and Williams, supra at [136] and [137] citing Zuvela, supra and Biogen, supra. The views and conclusions of the trial judge ultimately have to be shown to be wrong. They should not be laid to one side and a simple re-argument of the case take place.
It will be necessary to return to such considerations as these when examining the submissions of the appellants and their attacks on his Honour’s findings and conclusion.
I see no contradiction in what I have said with the views of, and approach exhibited by, Gleeson CJ (with whom Hope and Mahoney JJA agreed) in Australian Broadcasting Commission v XIVth Commonwealth Games (1988) 18 NSWLR 540 at 541-47 (a case where the primary facts were not in dispute), McHugh JA (as his Honour then was and with whom Kirby P, as his Honour then was, and Glass JA agreed) in GR Securities v Baulkham Hills Private Hospital (1986) 40 NSWLR 631 (a case concerning the effect of an exchange of letters), Griffiths CJ and Isaacs J in Howard Smith and Company Limited v Varawa (1907) 5 CLR 68 at 73 –81 and 84-88, Glass JA and Mahoney JA in B Seppelt and Sons Ltd v Commissioner for Main Roads (1975) 1 BPR 9147, 9148 and 9151-53, Gleeson CJ, Kirby P and Powell JA in Geebung Investments v Varga Investments (1995) 7 BPR 14, 551, the Full Court of Western Australia in Pirt Biotechnologies v Pirtferm Pty Limited [2001] WASCA 96 at [16] and [17] or the High Court in Warren v Coombes, supra, to all of which cases the appellants referred in their submissions.
Related to, but distinct from, the above, are the principles governing the departure by parties from the approach which they adopted to the controversy at the hearing. It is necessary to examine these principles because the respondents complain that many of the matters argued by the appellants were being raised for the first time on appeal.
The limitations upon what parties can put forward in an appeal court are set out in Suttor v Gundowda (1950) 81 CLR 418 at 438, Coulton v Holcombe (1986) 162 CLR 1 at 7-8, University of Wollongong v Metwally [No 2] (1985) 60 ALR 68 at 71, O’Brien v Komesaroff (1982) 150 CLR 310 at 319, Water Board v Moustakas (1988) 180 CLR 491 at 497, Connecticut Fire Insurance v Kavanagh [1892] AC 473 at 480, Crampton v R, supra [12] – [19], [111] and [147] and Liftronic Pty Ltd v Unver (2001) 179 ALR 321 at [44].
In Kweifio-Okai v RMIT University [1999] FCA 1686, Dowsett J at [62], in dealing with a fresh issue, there sought to be raised on appeal by the appellant, noted that the issue was complex and involved significant factual questions which were not addressed in evidence, at least by the respondent, so that it was difficult to see why the Full Court should then entertain it. Dowsett J referred to the proper approach by an appellate court in such circumstances as being that set out in the judgment of Starke J in Davison v Vickery’s Motors Ltd (In Liquidation) (1925) 37 CLR 1 at 35, where his Honour said:
No one, I suppose, disputes the authority of an appellate Court to consider questions raised, for the first time, before it, but such questions “ought to be most jealously scrutinized. The conduct of a cause at the trial is governed by, and the questions asked of the witnesses are directed to, the points then suggested. And it is obvious that no care is exercised in the elucidation of facts not material to them.”: Owners of Ship Tasmania v Smith (1890) 15 App Cas 223, 225. It is less difficult to induce a Court of Appeal to consider a question of law raised for the first time upon the construction of a document or upon undisputed facts, than a new question of fact. But a party cannot be allowed to take his chance of a finding in his favour upon the fact of an agreement, and then, on appeal, for the first time dispute the authority of the person who negotiated that agreement. Such a party is and ought to be bound by the course of the trial … .
The roles of the trial and the appeal need to be kept distinct. The appeal is not a reworking of the trial taking account of such impediments as are thrown up by the judge’s findings which alter the landscape. As was said in Coulton v Holcombe, supra at 7:
It is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial. If it were not so the main arena for the settlement of disputes would move from the court of first instance to the appellate court, tending to reduce the proceedings in the former court to little more than a preliminary skirmish.
It is beyond question that if a new matter is raised and evidence could have been given which by any possibility could have prevented the point from succeeding, the point cannot be taken: Coulton v Holcombe supra at 7-8.
However, to say as much does not exhaust the description of the considerations for an appellate court when faced with a party raising a fresh point. First, the finality of litigation and the importance of parties being bound to the cases they make at trial should never be overlooked: Gleeson CJ and Hayne J in Crampton, supra at [15] and [157], respectively and University of Wollongong v Metwally, supra; see too JB Chandler Investment Company Limited (in voluntary liquidation) v Commissioner of Taxation (1993) 47 FCR 588 per Gummow J at 593G. Secondly, the difficulty of the party against whom the new point is raised reaching back in time to assess, necessarily hypothetically, how the conduct of the trial would, or may, have been different should not be underestimated. Such judgments or assessments can require re-agitation or reconsideration of decisions taken before and at trial (which may be privileged) and which can be very difficult to assess and articulate after the event. The entitlement of a party to the benefit of the opportunity of informed and reasonably contemporaneous assessment of relevant evidence, or inquiry, should be respected. Thirdly, the potential unfairness on counsel conducting an appeal who will be expected to assist the court in respect of the prejudice, or lack of it, to his or her client in the face of such matters being raised should not lightly be brushed aside. Even when counsel cannot positively say that something in particular would have been done differently, that does not mean that the court will be satisfied of a lack of prejudice. The possibility of evidence or the possibility that the hearing would have taken a different course, if not fanciful, may well suffice to deny raising of the new point. These considerations should not be seen as not requiring counsel frankly and candidly to say that the trial would not have been conducted differently if he or she is of that view. Fourthly, and in conclusion, before any new point be allowed, the court should be able to be satisfied that the raising of it could work no injustice on the other party and is otherwise in the interests of justice. The extent of the consideration of “the interests of justice” was discussed by Branson J and Katz J in H v Minister for Immigration and Multicultural Affairs, supra, at [8]. For my part, I would reserve comment upon the matters there discussed in this context concerning the relevance of the growing pressure on the time of courts. Considerations of the kind there discussed by their Honours have not formed part of my reasons, expressed later, for refusing to entertain certain issues on appeal. Nothing I have said is intended to be in any way contrary to, or inconsistent with, what was said by R D Nicholson J in Jones v Minister for Immigration and Ethnic Affairs (1995) 63 FCR 32 at 47 or with the cases there discussed, that being an authority specifically relied on by the appellants in argument.
Whether or not a point was raised at the hearing should not be decided narrowly or technically. The pleadings and the particulars will ordinarily mark the boundaries of the dispute. Due regard also should be had to the direction of the conduct of the hearing within or outside these marked boundaries: Water Board v Moustakas, supra at 497-98.
The Issues Below
With this background, it is appropriate to examine what was pleaded by the parties.
The first applicant was Owston. Mr Anderson was the second applicant.
The first and second respondents were Branir and Tovehead Pty Limited (Tovehead), respectively. Their precise participation in events will be identified in due course. Mr Bakrie, who controlled both Branir and Tovehead, was the third respondent.
The applicants’ claims were, relevantly for the hearing before the primary judge, embodied in the Second Further Amended Application and the Second Further Amended Statement of Claim dated 22 January 1999 (the 2nd FASC).
The case is conveniently divisible between the claims concerning the alleged agreement concerning the land upon which the Sanctuary was situated and the surrounding land, which I will refer to as the Sanctuary Agreement, and the claims concerning the alleged agreement concerning the issue of shares in Branir, to which I will refer as the Share Agreement (it is also referred to in the evidence as the Shareholding Agreement).
The Sanctuary Agreement
The various claims pleaded about the Sanctuary Agreement have a certain complexity, though in a sense, and to a degree, such complexity was brought about only by variations in the legal framework for the claims.
The pleading commenced with a matter going back to 1990. In November 1989, Owston, which owned prior to this point the whole of Tipperary, sold half of it to Tovehead. It was alleged that on or about 1 February 1990 Tovehead represented to and agreed with Owston that:
… Owston was to have the use and possession of such parts of Tipperary (not exceeding 20,000 acres) as it might from time to time select for its own purposes, including the construction of a private zoo for the duration of the lease of Tipperary.
This allegation was particularised by reference to a document entitled a “Joint Statement of Understanding” executed by Owston and Tovehead on or about 1 February 1990. I will refer to this, as the primary judge did in his reasons, as the JSU. It was claimed (see para 10 of the 2nd FASC) that in reliance on the representations and agreement embodied in the JSU Owston continued to operate and develop the Sanctuary. It was in that context that the claims arising in late 1993 were made.
The applicants then pleaded (para 11) that on or about 23 December 1993 Owston and Branir executed a deed whereby Branir would buy from Owston assets which included Owston’s then half interest in Tipperary; but (see para 13) that “in late 1993” Branir and Tovehead (which since November 1989 had owned the other half of Tipperary) represented to and agreed with Owston that:
(a)Tovehead and Branir would allow to Owston the right to exclusive use of the Sanctuary and the further area referred to in the Statement of Understanding [ie the JSU] on the same terms as the underlying perpetual pastoral leases, with complete rights of access, at a nominal rent.
Particulars
The representation and agreement was oral and was made in conversations between
(i) Anderson on behalf of Owston and Bakrie and Nalin Rathod (“Rathod”) on behalf of Tovehead and Branir and
(ii) Dew on behalf of Owston and Graham on behalf of Tovehead and Branir,
in each case in around September 1993.
(b)Further and in the alternative, without prejudice to Owston’s right under the Statement of Understanding to select further parts of Tipperary to increase over time the area occupied by the Sanctuary up to 20,000 acres in total, on or within a reasonable time after 23 December 1993, Bakrie, Tovehead and Branir would execute a Deed granting to Owston the right, during the term of the perpetual leases of Tipperary, to exclusive use and benefit absolutely of all those parts of Tipperary then used by Owston for the Sanctuary, together with certain other rights, including the rights of ingress and egress to the Sanctuary.
Particulars
The representation and agreement was partly oral and partly in writing. To the extent that it was oral, it was made (i) in conversations between Rathod and Bakrie on behalf of Tovehead and Branir and Anderson on behalf of Owston in Jakarta on or about 13 December 1993 and/or (ii) between Dew on behalf of Owston and Graham on behalf of Tovehead and Branir on or about 22 December 1993. To the extent that it was in writing it was made in the form of an unexecuted Deed between Bakrie, Anderson, Tovehead and Owston substantially in the form of the Deeds which are Exhibit WPA 36 to the affidavit of Warren Perry Anderson sworn 12 September 1997 and Exhibit GGG to the affidavit of Arthur George Dew sworn 27 September 1997.
(c)Further and in the alternative, that after the execution and completion of the Final Sale Agreement:
(i)Branir and Tovehead would take all steps necessary to grant to Owston in perpetuity and for its exclusive use and benefit absolutely a lease in registerable form at nil rental of all that piece and parcel of land on Tipperary as were then used by Owston for the Sanctuary together with free and uninterrupted rights of carriageway including ingress to and egress from the said land in common with other users of Tipperary, together with such rights to use light, power and water from Tipperary as were enjoyed by Owston as at 23 December 1993;
(ii)Upon Owston selecting further parts of Tipperary for its exclusive use and possession as provided in the Statement of Understanding Branir and Tovehead would take all steps necessary to extend the lease referred to in sub-paragraph (c)(i) above so as to include the areas so selected; and
(iii)Pending the taking of the steps referred to in sub-paragraph (c)(i) and (ii) above, the arrangements for the operation and development of the Sanctuary embodied in the Statement of Understanding would be recognised and respected by them.
Particulars
The representation and agreement was made in:
(a)a telephone conversation between Graham on behalf of Tovehead and Branir and Dew on behalf of Owston on 23 December 1993;
(b)a letter from Graham on behalf of Tovehead and Branir to Anderson on behalf of Owston dated 22 December 1993 and delivered to Dew on behalf of Anderson and Owston on 23 December 1993;
(c)a conversation between Graham on behalf of Tovehead and Branir and Dew on behalf of Owston on 23 December 1993.
As can be seen from the particulars to the various parts of para 13 the basis of these claims was the communication between the Anderson and Bakrie interests in late 1993.
In paragraphs 13A to 15 the claim was put on the basis of an estoppel:
13A Further and in the alternative, on and about 23 December 1993, Tovehead and Branir engaged in conduct calculated to induce Owston to believe that Tovehead and Branir then considered themselves bound to honour the representations and agreements referred to in paragraphs 9 and 13 (the “Sanctuary Representations”).
Particulars
The conduct consisted of the execution of a letter dated 22 December 1993 from Graham on behalf of Tovehead and Branir to Anderson on behalf of Owston and the delivery of that letter to Dew on behalf of Anderson and Owston on 23 December 1993, in the context of:
(a)a previous draft of that letter providing that the arrangements for the sanctuary under the Statement of Understanding would continue pending finalisation of lease documents to give effect to a perpetual lease for Owston over the sanctuary area, having been prepared and sent to Graham by Dew on behalf of Anderson and Owston in late December 1993;
(b)the absence of any notice from Tovehead or Branir to Owston that the substance of the aforesaid draft letter was unacceptable to them;
(c)a telephone conversation between Dew and Graham on or about 22 December 1993 in which it was represented and agreed by Graham on behalf of Tovehead and Branir that, pending finalisation of lease documents to give effect to a perpetual lease for Owston over the sanctuary area, the arrangements for the sanctuary under the Statement of Understanding would continue indefinitely; and
(d)the absence of any notice from Tovehead or Branir to Owston or at any time prior to 23 December 1993 that they did not consider themselves bound to honour and give effect to the Sanctuary Representations.
14.On and after 23 December 1993, in reliance on the Sanctuary Representations and the conduct referred to in paragraph 13A, Owston:
(i)entered into the 1993 Sale Agreement and the Deed of Settlement; and
(ii)continued to operate and develop the Sanctuary and expended money on infrastructure for and improvements of the Sanctuary.
Particulars
The particulars to paragraph 10 are repeated with the exception of those set out in paragraph (c ).
Estoppel
14A.Knowing of the reliance by Owston on the Sanctuary Representations and the conduct referred to in paragraph 13A, Branir and Tovehead acquiesced in and encouraged the conduct of Owston referred to in paragraph 14.
Particulars
Branir and Tovehead;
(a)Stood by while Owston engaged in such conduct, without doing anything to lead Owston to understand that Branir and Tovehead did not consider themselves bound to honour the Sanctuary Representations;
(b)In the period around June 1994 and November 1994, assisted Owston, by the provision of staff and equipment, to extend the area of the Sanctuary by a further 250 hectares.
15.In the premises, Tovehead and Branir are estopped from asserting that Owston does not possess the rights which are specified in the Sanctuary Representations.
Finally, in paras 16-23, the claim was put on the basis of misleading or deceptive conduct under s 995 of the Corporations Law and s 52 of the Trade Practices Act1974, in conjunction with s 265 of the Corporations Law and s 51A of the Trade Practices Act. The representations contained in para 13A (see above) were said to be as to future matters, and to be ones for the making of which Branir and Tovehead had no reasonable grounds and they were also said to be false because Tovehead and Branir were said not to have considered themselves bound to honour them. (See paras 19 and 20.)
In respect of these claims dealing with the alleged Sanctuary Agreement the appellants (respondents at first instance) pleaded the following. First, the execution in 1990 of the JSU was admitted, but any right of selection of land pursuant to it was denied; further, it was said that if any such right existed, it was limited to land which was at the time of selection not fenced or cleared or ploughed or fertilised or seeded. The acting in reliance on the JSU was denied (para 10). As to the agreement pleaded in para 11 of the 2nd FASC the appellants in para 11 of the defence admitted the execution of the deed of 23 December 1993, but denied that “in entering” the sale agreement on 23 December 1993 (referred to in para 11) Branir had knowledge of the representation and agreement in the JSU. The respondents denied the allegations in paragraphs 13 to 23.
Various positive allegations were put forward in the defence. Some of them were, on a proper reading of the defence, directed both to the claims about the Sanctuary Agreement and about the Share Agreement. However, the primary judge dealt with most of them only in connexion with the Sanctuary claim. These matters were as follows. First, in paragraphs 42 to 44 of the defence, in answer to any claim for discretionary relief, the respondents pleaded clause 7.3 of the deed of 23 December 1993 whereby each of Owston and Anderson had covenanted that:
… they would take no action, including, without limitation, the commencement of legal proceedings which would:
(a)adversely affect any of the assets which were transferred by the said deed;
(b)adversely affect any of the rights of each of Branir, Tovehead or Bakrie; or
(c)adversely affect any of the assets of each of Branir, Tovehead and Bakrie.
Secondly, any claim by Owston and Anderson to enforce any alleged agreement arising out of dealings between the parties in 1993 was defeated by an entire agreement clause in clause 12 of the Deed: paragraphs 66 to 69 of the defence.
Thirdly, the limitation provisions of the Trade Practices Act and the Fair Trading Act1987 (NSW) were pleaded: para 45 of the defence. His Honour did not deal with this. It did not form part of the appeal.
The positive matters raised only in relation to the claims about the Sanctuary Agreement were as follows. First, a general Statute of Frauds point was pleaded insofar as the “applicants [sought] to enforce any agreement relating to an interest in land which [was] not in writing, or any interest in land which [was] not in writing”. Any such claim was said to be unenforceable (para 46). This matter was included in the notice of appeal, but was abandoned prior to the hearing in this Court. Secondly, the Crown Lands Act 1931 of the Northern Territory was pleaded in quite specific ways in answer to any claim that the applicants had enforceable rights in respect of the Sanctuary. (See paras 47 to 62). Thirdly, any claim under the JSU was sought to be answered by reliance on clause 5.2(b) of the Deed executed on 23 December 1993 in which all Owston’s rights in the Sanctuary vested in Branir. (See paras 63 to 65 of the defence.)
Some of the issues dealing with the Sanctuary Agreement thrown up by the 2nd FASC and the defence thereto were also contained in a cross claim filed by the respondents. First, a declaration was sought that the JSU was of no force and effect, by reason of the matters pleaded concerning the Crown Lands Act. Secondly, and in the alternative to the Crown Lands Act pleading, it was said that the JSU was a licence terminable on reasonable notice once either Owston or Tovehead ceased to be a lessee of Tipperary or was terminated once either ceased to a lessee. Owston, of course, ceased to be a lessee after it transferred its half interest to Branir on 23 December 1993.
Thus the issues on the pleadings concerning the Sanctuary Agreement, relevantly, were:
a)a denial of the agreement and representations;
b)a denial of the estoppel and misleading conduct;
c)a Statute of Frauds point;
d)issues arising under the Crown Lands Act; and
e)clauses 5.2(b), 7.3 and 12 of the Deed of 23 December 1993.
The Share Agreement
The contractual aspects of the so-called Share Agreement were pleaded in paras 24-27 of the 2nd FASC.
Paragraph 24 pleaded the agreement in the following form:
24.In late 1993 and prior to making of the 1993 Sale Agreement, it was agreed between Branir, Bakrie and Owston (the “Branir Shareholding Agreement”) that, at the option of Owston, such option to be exercised within 3 months of 23 December 1993 (the “option period”) Bakrie would procure Branir to issue and Branir would issue to Owston and register Owston as the holder of such number of shares in Branir as would result in Owston becoming holder of 40.815% of Bramir’s issued share capital (the “shares”), and;
(i)in consideration for Bakrie procuring the issue of the Shares and Branir issuing the shares, Owston would owe to Bakrie the sum of $8 million (the “Loan”);
(ii)the Loan would bear interest at the Indonesian market deposit rate from time to time;
(iii)the Loan would be able to be required by Bakrie to be repaid (and interest on the Loan would be payable) by Owston from, and only from, such dividends as may be declared and paid on the Shares from time to time;
(iv)Owston would irrevocably direct Branir to pay all dividends declared and paid on the Shares from time to time to Bakrie until such time as the Loan, together with accrued interest thereon, was repaid in full;
(v)until such time as the Loan, together with all accrued interest thereon, was repaid in full, Bakrie was to hold the certificate evidencing the Shares as security for the eventual repayment of the Loan;
(vi)Owston would pay all stamp duty accruing as a result of the issue of the Shares as aforesaid; and
(vii)Branir was to be debt free on settlement and until the expiration of the option period and, in the event that Owston had exercised its option as aforesaid, after the expiration of the option period, Branir would not incur any debt other than in the ordinary course of business of operating its assets.
Particulars
The agreement was partly oral and partly in writing. Particulars of the conversations and writing relied upon are set out in paragraphs 59-116 inclusive of the affidavit of Arthur George Dew (“Dew”) sworn in these proceedings on 27 September 1997 and in the documents referred to therein and in paragraphs 50-60 of the affidavit of Warren Perry Anderson sworn in these proceedings on 12 September 1997.
Paragraphs 25, 26 and 27 pleaded the following:
25.On or about 23 December 1993, Branir executed a letter addressed to Owston (the “Side Letter”) which purported to set out the terms of the Branir Shareholding Agreement.
26.On or about 23 March 1994, Owston informed Branir that it was taking up its rights to the Shares pursuant to the Branir Shareholding Agreement.
27.Branir and Bakrie have since 23 March 1994 failed and refused to issue or transfer to Owston the Shares.
The word “purported” in paragraph 25 masks one of the fundamental issues litigated below: whether the letter of 23 December accurately recorded any, and if so what, consensus to that point.
A claim for rectification of the “Side Letter” referred to in paragraph 25 of the 2nd FASC was pleaded in paragraphs 28 and 29. This was rejected by his Honour and was not the subject of a cross appeal.
Also, misleading or deceptive conduct and estoppel were pleaded in paragraphs 30 to 41 of the 2nd FASC. These matters were pleaded as follows:
30.On or about 23 December 1993, it was represented to Owston by Branir and Bakrie that the terms of the Side Letter would be construed and applied by Branir and Bakrie in a manner consistent with the terms of the Branir Shareholding Agreement and that that was the then present intention of both Branir and Bakrie (the “Side Letter Representation”).
Particulars
The representation was express and oral and was made by Charles Graham (“Graham”) on behalf of Branir and Bakrie to Dew on behalf of Owston on or about 23 December 1993.
31.The Side Letter Representation was made by Branir and Bakrie in connection with a dealing in securities, the allotment or issue of securities, and the carrying on of negotiations, the making of arrangements or the doing of acts preparatory to and related to such dealing, issue or allotment, within the meaning of s 995 of the Corporations Law.
32.The Side Letter Representation was made by Branir in trade or in commerce.
33.The Side Letter Representation was made by Branir and Bakrie with respect to a future matter within the meaning of s 765 of the Corporations Law and/or s 51A of the Trade Practices Act and/or s 41 of the Fair Trading Act.
34.Branir and Bakrie did not have reasonable grounds for the making of the Side Letter Representation.
35.Further and in the alternative, the Side Letter Representation was false when it was made in that Branir and Bakrie did not then intend that the terms of the Side Letter would be construed and applied by them in a manner consistent with the terms of the Branir Shareholding Agreement.
Particulars
The applicants say that this inference arises from:
(a)the conduct of Graham on behalf of Branir and Bakrie in:
(i)failing and refusing to provide, or procure the provision, to Owston, on or prior to 23 December 1993 or within a reasonable time thereafter, of a document fully and accurately setting out and recording the terms of Branir Shareholding Agreement;
(ii)falsely representing that shares in Branir had been issued to Owston by Branir in the letter to Anderson dated 29 July 1994 which is Exhibit WPA 42 to the affidavit of Warren Perry Anderson sworn 12 September 1997; and
(b)the conduct of Branir and Bakrie in failing and refusing to honour the Branir Shareholding Agreement after 23 December 1993 as referred to in paragraph 27 above.
36.In the premises, Branir and Bakrie have engaged in misleading or deceptive conduct in contravention of s 995 of the Corporations Law and or s 52 of the Trade Practices Act and/or s 42 of the Fair Trading Act.
37.On or about 23 December 1993, in reliance on the Side Letter Representation, Owston entered into the 1993 Sale Agreement and the Deed of Settlement.
38.By reason of the conduct of Branir and Bakrie as aforesaid, Owston has suffered and will suffer loss and damage.
Particulars
The loss and damage suffered by Owston comprises:
(a)the failure and refusal of Branir and Bakrie to issue or transfer to Owston the Shares; and
(b)the entering into by Owston of the agreements referred to in paragraph 37 above.
Estoppel
39.In the premises of paragraphs 24 and 37 Branir and Bakrie are estopped from construing or applying the terms of the Side Letter in a manner which is inconsistent with the terms of the Branir Shareholding Agreement.
40.In breach of the term of the Branir Shareholding Agreement set out in paragraph 24(vii) and contrary to the Side Letter Representation Branir was not debt free on settlement but was capitalised with a subordinated shareholder loan in the sum of $20,532,000.
41.By reason of the conduct referred to in paragraph 40 Owston has suffered loss and damage.
The “Branir Shareholding Agreement” was simply denied: para 24 of the defence. The 23 December 1993 letter was admitted as a fact, as was the receipt of the letter dated 23 March 1994. Paragraphs 25 and 26 were otherwise denied. All paragraphs up to 41 were denied.
Various positive allegations were made in the defence concerning the Share Agreement. First, paragraph 40 of the defence said that Owston was not ready willing and able to perform the said agreement. The particulars of that allegation were as follows:
(a)Owston is not ready or willing and has not offered to pay the whole or any part of the AUD 8 million plus interest calculated on a daily basis at the current Indonesian market deposit rate from time to time to Branir for the shares.
(b)Owston has not offered reasonably suitable security arrangements for any debt it may owe to Branir pursuant to the said agreement.
(c)Owston has not offered to irrevocably direct Branir to apply all dividends to be paid to Owston in respect of any shares issued to Owston in partial satisfaction of its obligation to pay the sum referred to in sub-paragraph (a) above. [Emphasis added.]
By way of interpolation, it is relevant to note for a ground of appeal concerning the primary judge’s refusal to allow the appellants to reopen on one matter that the appellants pleaded what is emphasised in [66] above. See also the emphasised passage in [69] below. I will return to this in due course.
Secondly, in paragraph 41, without descending to any particularity, the respondents said that the Court would in its discretion refuse to order specific performance of the Share Agreement.
The cross claim also contained allegations related to the question of shares in Branir. There, in paragraphs 14 to 16 and in the claims in paragraphs 4 to 6, it was put that the letter of 23 December 1993 in its terms was an offer, which was accepted by the letter of 23 March 1994 and, subject to the issue of the shares, a claim for $8 million plus interest (at the Indonesian market rate from time to time for such deposits) was made, for the price of the shares. These paragraphs were in the following terms:
14.Further, by a letter dated 23 December 1993 Branir offered certain shares in Branir on the terms and conditions contained therein.
Particulars
Letter of Branir signed by CT Graham and dated 23 December 1993.15.By letter dated 23 March 1994 Owston accepted the offer made by Branir referred to in the preceding paragraph.
Particulars
Letter of Owston signed by WP Anderson and dated 23 March 1994.16.A dispute between Branir and Owston as to whether any agreement constituted by the letters pleaded in paragraphs 14 and 15 exists and as to its meaning and effect.
And the cross-claimants claim:
…4.A declaration that on the true construction of any agreement between the first cross-claimant and the first cross-respondent which may be constituted by the first cross-claimant’s letter of 23 December 1993 and the letter in response thereto from the first cross-respondent it is the obligation of the first cross-claimant to issue a share certificate or certificates for such number of shares as will result in the first cross-respondent becoming the holder of 40.815 per cent of the first cross claimant’s issued share capital and it is the obligation of the first cross-respondent to pay upon demand the sum of $8 million together with interest as from 23 March 1994 at the rates referred to below and that pending payment of the said sum the share certificates relating to the said 40.815 per cent of the issued capital of the first cross-claimant are to be held by the third respondent as he may direct as security for the payment to the first cross-claimant of the said sum of $8 million together with interest.
5.A declaration that the rate of interest payable by the first cross-respondent to the first cross-claimant pursuant to the agreement referred to in declaration 1 is the Indonesian market interest rate for deposits from time to time of rupiah in amounts equivalent from time to time to $AU8 million.
6.Order that upon the first cross-claimant undertaking to the Court to issue the share certificates referred to in declaration 4 above, the first cross-respondent pay to the first cross-claimant the sum of $8 million together with interest as from 23 March 1994 at the rate or rates referred to in declaration 5 above. [Emphasis added.]
The defence and cross claim denied the Share Agreement and put forward a different contract – one embodied in the terms of the letter of offer of 23 December 1993. The appellants’ case was that no agreement existed on 23 December 1993, and certainly not one as embodied in the Share Agreement as alleged.
So, in relation to the Share Agreement, the pleadings, relevantly, threw up the following issues:
a)Was there, or was there not, some agreement in or by December 1993 about issuing shares which was partly written and partly oral? The applicants said, yes and the appellants, no. Given the particulars this was a factual question likely to be determined by reference to acceptance of witnesses. The answer to it would validate or falsify the cross claim based on the two letters, since elements of the Share Agreement as alleged in the 2nd FASC were inconsistent with the contents of the letter of 23 December 1993;
b)the ready, willing and able defence: see [66] above; and
c)the unparticularised discretionary defences.
As I said earlier, clauses 7.3 and 12 of the Deed of 23 December 1993 were dealt with by the primary judge only in relation to the Sanctuary claim, but they appear on the pleading also to relate to the Share Agreement.
The Conduct of the Hearing
To a limited degree it is necessary to say something, in addition to the pleadings, as to how the hearing was conducted. The parties did not provide the Court on appeal with the whole transcript of proceedings before the primary judge. Each side provided the pages thought to be relevant and sufficient for the task on appeal. However, from the material provided and the terms of the judgment the following seems clear. First, credit was central. Many of the conversations said to underpin and embody the pleaded agreements were denied by the appellants and their witnesses. The applicants (respondents to the appeal) said that by 23 December 1993 conversations had occurred and acts had been done demonstrating an unequivocal consensus and intention to be bound, in essence, to two agreements which were not (as known to the parties) fully reflected in the inadequate documentation signed and initialled on 23 December 1993 which concerned those two matters. The appellants (respondents below) did not just deny that words spoken, or letters written, amounted to a contract (in the manner of a debate in a vendor/purchaser suit commenced by way of summons), rather the whole body of conversations and events was put in issue. The appellants’ case was that there was no agreement about either the shareholding or the Sanctuary and that conversations and events said to have occurred by the applicants did not take place. The appellants said that there was no consensus as to any agreement and no intention to be bound, save and except that there was a letter of offer of Votraint/Branir which, if accepted (and if lawful), required $8m to be paid by Owston to Votraint for 40.815% of shares in Votraint, which company had a significant debt owed to another company arising out of the funding of the purchase by Votraint of Owston’s half interest in Tipperary.
The primary judge resolved the credit issues. Closely related to the question of credit the primary judge also made findings about the behaviour of Mr Charles Graham, one of Mr Bakrie’s senior advisers and confidants.
The conflict of evidence was largely between, on the one hand, Mr Anderson and his principal adviser Mr Arthur Dew, and, on the other hand, Mr Bakrie, Mr Bakrie’s principal Indonesian adviser, Mr Nalin Rathod and Mr Bakrie’s principal Australian adviser, Mr Graham. Other witnesses were of importance, but the central conflict of events concerning the existence or not of agreements concerned the evidence of these men.
His Honour made a number of findings in connection with the witnesses. He found that Mr Anderson and Mr Graham had a poisonous relationship (J[44]). On the basis of this antipathy he found that Mr Graham actively tried to destroy Mr Anderson’s close personal and business relationship with Mr Bakrie. Mr Graham pursued conduct which did not necessarily accord with Mr Bakrie’s understanding or interests (J[45]). Mr Graham often did not deal in good faith with Mr Dew (J[46]). He found that Mr Rathod in relation to central evidence about conversations between him, Mr Anderson and Mr Bakrie in December 1993 in Jakarta was evasive, prevaricating and untruthful (J[79]). His Honour characterised Mr Graham’s evidence about the important events in December 1993 as untruthful (J[80]). His Honour found the cross-examination of Mr Rathod, Mr Graham and Mr Bakrie regarding the conversations of December 1993 devastating to their credibility, showing their evasiveness, vagueness and obfuscation and in Mr Graham’s case preparedness to deliberately lie (J[80]). His Honour rejected Mr Graham’s evidence virtually entirely, especially where it conflicted with that of Mr Anderson and Mr Dew (J[80]). He found that Mr Graham had lied to Mr Dew in November and December 1993 about a deed being drafted in Jakarta, the significance of which will become clear in due course, but it suffices for present purposes to note his Honour’s finding that it was part of Mr Graham’s deliberate delaying of events in order to frustrate any smooth completion (J[84]).
A number of matters should be noted about the pleading of the provisions of the Pastoral Lands Act. First, the defence was dated 22 January 1999. At that time, arguably, para 61 was correct that the existing regulations, in particular regulation 31, did not include activity of the kind conducted on the Sanctuary as a “prescribed purpose” for the purposes of subs 68(5). However, on 12 May 1999 the regulation 31 was amended to the effect that keeping and breeding animals other than stock became a prescribed purpose. So, at the time of the orders the Minister could grant consent under subs 68(5).
Secondly, the inability to satisfy the matters set out in para 61 of the defence was pleaded in the present tense. It was plainly intended to speak not only at the time of filing of the defence but also thenceforth, including, most importantly, at the time of hearing and determination. It was not a pleading directed to the time of entry into the contract pleaded. It was not a pleading that the transaction or contract as pleaded or claimed was expressly or impliedly prohibited or otherwise in some respect illegal or tainted with illegality.
Thirdly, the only ground pleaded which expressed a reason why the contract propounded was affected by the Pastoral Lands Act was para 62. There it was pleaded that the Court could not, or would not in its discretion, order the appellant to take steps to procure the granting of a sub-lease, because the Minister did not have the power to grant it because of the present lack of existence of a state of affairs to permit the Minister so to consent. By the time of the orders that present position did entitle the Minister to grant a sub-lease.
Fourthly, there was no pleading that Owston’s use of the land was unlawful. Indeed during the hearing the then senior counsel for the appellants expressly disavowed any such claim. Paragraphs 56 and 57 only pleaded that Owston and Tovehead had been in breach of a condition of the pastoral leases by conducting the Sanctuary.
Fifthly, there was no pleading by the respondents that the case as pleaded by the applicants involved a contract which was expressly or impliedly prohibited by the Pastoral Lands Act. Given the form of the claimed rights, as being directed to the land in question, without any qualification of purpose, it is perhaps understandable why there was no pleading that the contract pleaded was expressly prohibited by the Pastoral Lands Act. It may also explain, though less clearly, why there was no pleading that the contract pleaded was impliedly prohibited by the Pastoral Lands Act. However, the form of the claimed rights does not explain why there was no pleading that the agreement pleaded and the rights claimed, though not expressly or impliedly prohibited by statute, were void as against public policy by reason of being associated with, or made in furtherance of, a purpose of frustrating the operation of the statute: see generally Nelson v Nelson (1995) 184 CLR 538; Fitzgerald v Leonhardt (1997) 143 ALR 569, 574-80; and Yango Pastoral Co Pty Ltd v First Chicago Australia (1978) 139 CLR 410. The absence, indeed disavowal, of a claim that Owston’s occupation was illegal, in the context of the pleading, and in the absence of a challenge either that the contract was expressly or impliedly prohibited or that the contract was void as too closely associated with, or was in furtherance of, an unlawful purpose, meant that statutory illegality and the effect of public policy were not issues agitated before the primary judge.
At this point it is appropriate to refer to the terms of the Pastoral Lands Act pleaded in the defence and reply: para 38(1)(d) and ss 67 and 68 were in the following terms:
38.Conditions of Pastoral Leases
(1)Without limiting the power of the Minister to impose such other conditions as he or she thinks fit on the granting of a pastoral lease, a pastoral lease is subject to the following conditions and reservations:
…
(d) that, subject to section 88, the lessee will use the land only for pastoral purposes;
(b)section 67
67. Consent to transfer, &c., of lease, &c.
(1) Except as provided by this Act, a pastoral lessee shall not, without the consent of the Minister -
(a) transfer his or her pastoral lease;
(b) sub-let the land or part of the land the subject of the pastoral lease; or
(c) otherwise part with possession of the land or part of the land,
and compliance with this subsection is a condition of the lease.
(2) Except as provided by this Act, a sublessee of pastoral land shall not, without the consent of the Minister -
(a) transfer his or her sublease;
(b) further sub-let the subleased land; or
(c) otherwise part with possession of the land or part of the land.
Penalty for an offence against this subsection: $5,000.
(c)section 68
68 Application for consent to transfer, &c., of leases, &c.
(1)An application for consent to transfer a pastoral lease or a sublease of land the subject of a pastoral lease, or to sub-let the land the subject of a pastoral lease, shall be made in writing by the lessee to the Minister.
(2) On receiving an application under subsection (1) the Minister may refer it to the Board for consideration and recommendation and the Board shall report to the Minister within 30 days after the application is referred to it.
(3) The Minister shall, after considering the recommendations of the Board, but subject to subsections (4) and (5) and section 35(6), by notice in writing to the lessee or sublessee (or as the case may be), consent or refuse to consent to the transfer of the pastoral lease or sublease or the sub-letting of the land.
(4) The Minister shall not consent to the transfer of a pastoral lease until all instalments of the purchase price for the grant of the lease, and all rent and other moneys due and payable to the Territory under the lease, have been paid.
(5)The Minister shall not consent to a subletting of land or a part of the land the subject of a pastoral lease unless it is a condition of the agreement to sub-let that the land will be used only for pastoral purposes, for the purposes of the Territory or for a prescribed purpose.
Regulation 31 as it stood prior to its amendment in May 1999 was in the following terms:
31.Prescribed purposes under section 68(5) of the Act
The prescribed purposes under section 68(5) of the Act are as follows:
(a)supplying or conveying to, through or across the land an electricity service;
(b)supplying or conveying to, through or across the land gas, liquid fuels or water or other liquids in such a form as to be capable of conveying energy; and
(c)establishing and operating a commercial tourist enterprise.
To those three purposes in Regulation 31 was added by instrument No 17 of 1999 a fourth prescribed purpose as follows:
(d) keeping and breeding animals (other than stock).
The primary judge dealt with the Crown Lands legislation at J[109] to J[125]. At J [109] to J[112] he dealt with the pre – 1992 legislative regime under the Crown Lands Act. He then dealt with the Pastoral Lands Act. At J[114], J[115] and J[116] his Honour set out the appellants’ arguments. In examining them it is necessary to bear in mind what was pleaded and what was not pleaded.
At J[114] the primary judge said:
The respondents said that the clear intent of the [Pastoral Lands Act or PLA] was to prohibit a change in land ownership or use without the prior consent of the Minister and that section 68(5) proscribes the granting of that consent unless it is a condition of the agreement to sub-let the land that the land only be used for pastoral purposes, for the purposes of the Northern Territory or for a purpose prescribed under regulation 31 (the details of which are not here relevant). The respondents submitted that the use of part of Tipperary as a Sanctuary is outside the PLA’s definition of these purposes. They therefore contended that any sub-lease of the Sanctuary would be in contravention of the section from the time it was purportedly made and that the Court lacked power to compel specific performance of an agreement containing a condition to submit the matter for ministerial consent. If this argument is correct, it would presumably no less apply to the transfer to Branir of the second half interest in Tipperary – as it did to Tovehead’s purchase of the first half – than to any problem concerning the Sanctuary and I have been able to find no reference in the evidence to ministerial consent having been granted for Branir to take its half interest. However, as Branir is said to have become the registered proprietor of its half share on 14 December 1994, it seems that ministerial consent must have been granted.
The primary judge saw regulation 31 as irrelevant at this point. He later referred to the change to that regulation which made the Sanctuary a purpose for which consent could be given under subs 68(5). Regulation 31 was at this point irrelevant because his Honour was dealing with a submission that the sub-lease, that is the grant of a sub-lease as pleaded in paragraph 58 of the defence, was in contravention of subs 68(5) “from the time it was purportedly made and that the Court lacked power to compel specific performance of an agreement containing a condition to submit the matter for Ministerial consent.” He then went to Roach v Bickle (1915) 20 CLR 663 to illustrate the consequences of the argument. Stopping here for the moment, J[114] does not reflect an argument that an agreement subject to the consent of the Minister to grant a sub-lease was expressly or impliedly prohibited or so closely associated with an illegality as to be contrary to public policy, rather it was an argument that a sub-lease or a grant of a sub-lease of the land was sought to be effected by what happened in December 1993 and that the Pastoral Lands Act made ineffective the creation of such a sub-lease without consent. That this is what was being put by the appellants and that this is what the primary judge was dealing with is made clear by what he said in J[116]:
The respondents’ submission was that, applying these principles, the purported grant of a sub-lease to Owston without ministerial consent is ineffective and invalid and the use of the Sanctuary for a non-pastoral purpose renders the obtaining of that consent impossible.
The appellants sought to draw from extracts of the written submissions put to the primary judge that illegality was argued if not pleaded. I reject this. The extent of matters put to the primary judge which the appellants said raised illegality concerned the lack of an entitlement to operate the Sanctuary before and after 1992 and the ineffectiveness of the grant of any sub-lease and the lack of present entitlement to consent. They did not extend to the matters referred to in [479] and [480] above. The appellants also submitted that the terms of the reply, in particular para 12 thereof ([475] above) sufficiently widened the issues on the pleading to allow the appellants now to argue the kind of matter referred to in [479] and [480] above. Plainly it did not. I reject this submission. The last six words of para 12 “and not as prohibitions of law” do not raise illegality. They are used as words of emphasis and contrast. They do not somehow create an issue absent from the defence.
The argument that what occurred on 23 December was the grant of a sub-lease was pleaded in para 58 of the defence. The argument that such a grant of sub-lease was ineffective and invalid could be seen as pleaded in reading paras 58 and 59 together.
The first answer of the applicants to this argument was to emphasise that subs 67(1) dealt with conditions of the pastoral lease. They relied on Massart v Blight (1951) 82 CLR 423 for the proposition that the grant was not nugatory, but rather exposed to forfeiture. The primary judge dealt with this at J[117] and in the first two sentences of J[118].
The primary judge then, at J[118] and J[119], dealt with the other argument of the applicants that there was no grant of a sub-lease at that time, but an agreement to sub-lease subject to an express or implied term to obtain consent before its grant. This way of viewing the legal consequences of agreement in December 1993 also defeated the argument of the appellants that what had happened was the grant of a sub-lease which was ineffective.
The primary judge then dealt with the matters pleaded in paras 58 to 62 of the defence: the impediment on the Court ordering the appellants to grant or to take steps to procure the granting of an interest in Tipperary by way of sub-lease because the use “is” not a use capable of attracting consent. At this point, the issue now being central, the primary judge noted the change to regulation 31. He thus concluded in J[121], in effect, that the pleaded bar in para 62 of the defence failed. He then said:
… In the absence of an obvious bar to consent being obtained, there in my opinion is no reason that the Court could not order the specific performance of an agreement on condition that an application be submitted to the Minister for any and all necessary consents and subject to that consent being given.
Thus, the primary judge dealt with the matters pleaded which raised the Pastoral Lands Act. His Honour did not mention cases such as Yango Pastoral, supra, Nelson v Nelson, supra and Fitzgerald v Leonardt, supra, because illegality was not an issue before him. In that context the primary judge made a declaration in the form of order 1.
On appeal, a number of matters were argued. First, it was said that the primary judge could not declare the agreement to grant a sub-lease subject to consent, because it was a consent which could not have been granted at the time of contract formation. Secondly, and related to the first point, the agreement was one which was at all times impliedly prohibited by the statute. Thirdly, the agreement was void for public policy as being so closely associated with, or in furtherance of, an illegality.
None of these matters was pleaded. Each draws inspiration and support from the terms of the declaration in order 1. The terms of the declaration included within them a contractual purpose of using the land as a sanctuary. That had not been claimed by Owston. It had claimed an agreement for certain land then used by it for the Sanctuary and further land up to 20,000 acres. Plainly the Minister could consent to a bare sub-lease. There was no impediment in subs 68(5) to that. The lease merely required a condition to use the land for certain purposes (though such purposes did not include conducting a sanctuary). All parties knew that the purpose of wanting the lease (at least for the foreseeable future) was for the conduct of the Sanctuary. The appellants, of course, recognised that and pleaded subs 68(5) of the Pastoral Lands Act and the present use as a sanctuary in order to found the defence in para 62. That defence was defeated by the change to regulation 31.
As indicated earlier, there was no pleading of illegality of use or that the contract as entered was void as against public policy or that the contract was expressly or impliedly prohibited by the Pastoral Lands Act. If there had been, there may have been closer attention by the parties and the primary judge to the question whether or not the agreement as declared should have any inclusion of a limitation by way of purpose or use. It is certainly arguable that an examination of the relevant conversations and documents from 1989 does not support an importation of a limitation of the sub-lease for a purpose of sanctuary. The early (1989 and 1990) discussions made clear that each of Mr Bakrie and Mr Anderson was to have 20,000 acres privately. (See [85] above.) The use of the land as a sanctuary by Mr Anderson was an anticipated and permitted use. It was arguably not a required use, nor was it expressed as the only possible use of the land. The 1989 Co-Ownership Agreement and the JSU said “Owston … to use … for its own purposes, including construction of a private residence and zoo.” (See [89] above.) Sometimes the language of the parties referred to the Sanctuary by way of identification of the land, not by way of restriction on anticipated purposes. See for example Mr Anderson’s discussion with Mr Dew when calling him from Jakarta in September 1993, (see [102] above) and Mr Dew and Mr Graham’s conversation around that time ([103], [104] and [105] above). It is plain that the basal element of the intended arrangement and consensus was that each would get 20,000 acres for himself (or his interests). (See what Mr Graham said to Mr Langham in late 1993 ([106] above). The draft deeds of December 1993 and the conversations about them arguably make clear that the 20,000 acres was to be perpetual and not only for use of the land as a sanctuary. The draft deeds ([161] and [168] above) referred, by way of identification of the land, to “those parts of Tipperary presently used by Owston as a private zoo, residence and recreation purposes”. This was amended by oral agreement to 20,000 acres of the existing sanctuary land and contiguous land. The oral agreement was clear: a perpetual lease. Perhaps the conversation between Mr Anderson and Mr Bakrie in December 1993 ([163] above) comes closest to a foundation for such a limitation of use to a sanctuary:
Anderson:“Now, in regards to the Sanctuary, we have an agreement from our original deal that each of us have 20,000 acres. My 20,000 acres was for the Sanctuary and yours was to build a house on and have as a personal asset….”
Bakrie“Yes, that is alright … what term do you want?”
Anderson“The same as the perpetual lease on the land.”
Bakrie“Okay”
It was certainly envisaged that the Sanctuary was the foreseeable purpose of the 20,000 acres but, arguably, there was no basis to conclude that there was a bargain which would restrict the use of the 20,000 acres to a sanctuary. For my part, on the evidence, I would not impose such a limitation of purpose. However, by the way the case was pleaded and conducted this did not have to be decided. By the way the case was pleaded and conducted his Honour made the declaration he did. The possible importance of the importation of a limitation of purpose or use to an argument based on statutory illegality was not before the primary judge. It was not pleaded that the contract could not be one subject to the consent of the Minister because at the time of entry (December 1993) consent could not be given because of subs 68(5). That section would not have prevented consent being given to a sub-lease of land simpliciter, as claimed. It might well have prevented consent to a sub-lease of land which required as the only permitted purpose something outside regulation 31. The only operation of subs 68(5) pleaded was as a foundation of a bar to relief set out in paras 59 to 62 of the defence which, as I have said, fell with the change to regulation 31. The appellants could have pleaded illegality and in particular pleaded that the contract in the 2nd FASC was either impliedly prohibited or was void for public policy as associated with or in furtherance of a present or contemplated illegality. They did not. If they had done so, the importance of the relationship between s 67, subs 68(5) and regulation 31 in its form as at December 1993 would have become apparent. It would have then become important for the parties and the primary judge to direct their attention to the nature of the agreement in that regard. Issues such as the following would have arisen, none of which did arise: Was the agreement to be expressed as the primary judge did in order 1 or was it an agreement for the sub-lease of an area by reference to where the Sanctuary was? Depending, in part, on the answer to that: was the contract impliedly prohibited by the Pastoral Lands Act, or, if not, or was it a contract sufficiently associated with illegality to be void and unenforceable? In particular, if the contract was associated with illegality, were there present the kinds of matters referred to by McHugh J in Nelson v Nelson, supra at 604-605 and 612-13 or by McHugh and Gummow JJ in Fitzgerald v Leonhardt, supra at 578-80? For instance, were the parties ignorant or mistaken as to matters concerned with the illegality? What factors might, in the circumstances of the Northern Territory, bear upon the question of the proportionality or disproportionality of rendering the agreement void?
These matters should not now be allowed to be canvassed. They clearly raise evidentiary matters. His Honour dealt with the relevant matters raised on the pleadings and in the context of the disavowal and lack of pleading of illegality as I have discussed. The ability to put forward arguments that there could be at the time of entry into the agreement no consent given under subs 68(5) or that the contract was impliedly prohibited as against public policy flows, at least in part, from the term of a declaration of the primary judge which was made in the absence of any such arguments. If these matters had been pleaded the primary judge would have had thrown up for evidence, debate and his consideration issues directing him to the use and purpose of use of the land, the parties’ beliefs, the knowledge of the Northern Territory government about Owston’s activities, many other matters concerned with the proportionality of the Court refusing to enforce a contract and the relevance of these things to the terms of any declaration. It is too late to raise these matters now. It is too late to raise matters which cause these kinds of issues to become relevant now, for the first time. By taking this course no offence is done to the law of the Northern Territory. The use of the land as a Sanctuary is now a prescribed purpose for subs 68(5). If any step is desired to be taken by the authorities in respect of past occupation, that can be done.
His Honour was correct, in the light of the matters pleaded, to apply Brown v Heffer (1967) 116 CLR 344. It was said in argument before us that Brown v Heffer could not apply where consent could never have been given to the sub-lease because of subs 68(5). However, once again, the force of that argument comes from the suppressed premise within it that the contract in terms or effect was for a purpose contrary to the Pastoral Lands Act or associated with such a purpose. The matter was not pleaded in that way. Again, if it had been, conformably with the evidence which I have identified, his Honour may have found an agreement to sub-lease an area of land identified by a particular current activity only and not for this one purpose. It was plainly open to him to do so. That contract could have obtained consent, it not being a contract which carried within its terms the use of the land for non-pastoral purposes. Its enforceability however would have to be judged by its closeness to any identified illegal purpose. One returns necessarily to the illegality issue that I have mentioned and that was not pleaded.
All the submissions of the appellants on the Pastoral Lands Act, in the context which I have set out, otherwise seek to raise, or cause to be raised, issues not pleaded. I would not permit this.
His Honour dealt with the issues pleaded. His only error in this regard was to limit the declaration to the life of Mr Anderson. There was no evidential basis for this. It was not reasonable for the purpose of Byrne v Australian Airlines Ltd, supra, in the light of the evidence. The words “in perpetuity” should be inserted as claimed in the cross appeal.
The cross appeal also complains about the failure by his Honour to ground his conclusion in estoppel, the Corporations Law and the Trade Practices Act. As argued, I would see these as alternatives to the contract and only pressed if the Court were otherwise minded to uphold the appeal on the contract. I have earlier expressed my views that his Honour’s declarations and orders can be supported not only by the contract pleaded but by his findings on estoppel and misleading or deceptive conduct. It is unnecessary to add anything further.
Proposed Orders
In respect of the appeal (N 1121 of 2000) the orders which I would make are:
1.that subject to order 2 below the appeal be dismissed;
2.that declaration 3(b) made by the primary judge to the effect that “the first respondent is to be debt free on the issue of the Shares” be varied by adding thereafter the words: “subject to such obligations or debts, if any, as arise or may arise from any undertaking by the first appellant, Branir Pty Limited then known as Votraint No 788 Pty Limited, in the letter of 22 December 1993 which was signed by Mr Nalin Rathod on behalf of the first appellant, and a copy of which was annexure D to the affidavit of Mr Arthur Dew sworn 27 September 1997.”; and
3.that the appellants pay the respondents’ costs.
In respect of the cross appeal (appeal N 1120 of 2000) the orders which I would make are:
1.that the appeal be allowed;
2.that declaration 1(a) made by the primary judge be varied to substitute for the words “for the life of the second applicant” the words “in perpetuity”; and
3.that the respondents pay the appellants’ costs.
I certify that the preceding five hundred and one (501) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate:
Dated: 20 December 2001
Counsel for the Appellants: Mr J C Campbell QC with Mr F Kunc Solicitor for the Appellants: Blake Dawson Waldron Counsel for the Respondents: Mr J N West QC with Mr M Steele Solicitor for the Respondents: McGirr James Hall and Associates Date of Hearing: 14, 15, 16, 17 and 18 May 2001 Date of Judgment: 20 December 2001
700
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