City & Suburban Group Pty Ltd v Gambetta Holdings Pty Ltd
[2011] WASCA 233
•27 OCTOBER 2011
CITY & SUBURBAN GROUP PTY LTD -v- GAMBETTA HOLDINGS PTY LTD [2011] WASCA 233
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2011] WASCA 233 | |
| THE COURT OF APPEAL (WA) | |||
| Case No: | CACV:95/2010 | 11 AUGUST 2011 | |
| Coram: | NEWNES JA MURPHY JA HALL J | 27/10/11 | |
| 18 | Judgment Part: | 1 of 1 | |
| Result: | Appeal dismissed | ||
| B | |||
| PDF Version |
| Parties: | CITY & SUBURBAN GROUP PTY LTD GAMBETTA HOLDINGS PTY LTD |
Catchwords: | Contract Contractual construction Identity of parties Turns on own facts |
Legislation: | Nil |
Case References: | Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299 Gambetta Holdings Pty Ltd v City & Suburban Group Pty Ltd [2010] WADC 124 Ryledar Pty Ltd v Euphoric Pty Ltd [2007] NSWCA 65; (2007) 69 NSWLR 603 Scottish Amicable Life Assurance Society v Reg Austin Insurances Pty Ltd (1985) 9 ACLR 909 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : CITY & SUBURBAN GROUP PTY LTD -v- GAMBETTA HOLDINGS PTY LTD [2011] WASCA 233 CORAM : NEWNES JA
- MURPHY JA
HALL J
- Appellant
AND
GAMBETTA HOLDINGS PTY LTD
Respondent
ON APPEAL FROM:
Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA
Coram : EATON DCJ
Citation : GAMBETTA HOLDINGS PTY LTD -v- CITY & SUBURBAN GROUP PTY LTD [2010] WADC 124
File No : CIV 648 of 2009
(Page 2)
Catchwords:
Contract - Contractual construction - Identity of parties - Turns on own facts
Legislation:
Nil
Result:
Appeal dismissed
Category: B
Representation:
Counsel:
Appellant : Mr H R Robinson
Respondent : Mr J N D'Angelo
Solicitors:
Appellant : Haydn Robinson
Respondent : PSB Legal
Case(s) referred to in judgment(s):
Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299
Gambetta Holdings Pty Ltd v City & Suburban Group Pty Ltd [2010] WADC 124
Ryledar Pty Ltd v Euphoric Pty Ltd [2007] NSWCA 65; (2007) 69 NSWLR 603
Scottish Amicable Life Assurance Society v Reg Austin Insurances Pty Ltd (1985) 9 ACLR 909
(Page 3)
1 NEWNES JA: This is an appeal against a decision of Eaton DCJ in the District Court in which his Honour held that the appellant was liable to pay to the respondent the sum of $51,649.95 plus interest (a total sum of $60,072.00) under a contract made between the appellant and the respondent.
2 The appellant contends that the primary judge erred in finding that the contract was between the appellant and the respondent. It says his Honour should have found that the contract was made between the respondent and a company associated with the appellant, Exmouth Marina Holdings Pty Ltd (Exmouth Marina), with the result that the appellant was not liable for the sum claimed.
Background
3 Exmouth Marina was at the material time engaged in the development of a 170 lot canal subdivision at Exmouth in the north of the State. The appellant was the project manager. The appellant and Exmouth Marina were associated companies. Mr Jonathon Warren was the sole director and shareholder of Exmouth Marina and the sole shareholder in and one of two directors of the appellant (ts 167).
4 One of the contractors which had been engaged to carry out the work on the development was one Barry Hughes. There is nothing to suggest that Barry Hughes was associated with the appellant or Exmouth Marina.
5 The respondent built and installed marinas and made equipment for marina projects. The sole director of the respondent was Mr Leno Cilia.
6 In or about the middle of 2006, there were discussions involving Mr Warren and Mr Stephen Lubich, on behalf of the appellant, and Mr Cilia, on behalf of the respondent, concerning the provision and installation by the respondent of chafers and piling for the first stage of the canal development. Thereafter there were negotiations between Mr Lubich and Mr Cilia concerning the supply of the chafers and piling, involving matters of specification, price and installation date.
7 One of the other matters which remained to be determined was whether, if the respondent's quote was accepted, the respondent would enter into a contract for the supply and installation of the chafers and piling with the appellant or with Barry Hughes, as a nominated subcontractor of Barry Hughes.
(Page 4)
8 On 27 October 2006, Mr Lubich sent an email to Mr Cilia in the following terms:
Further to our conversation this morning, I can confirm that based on your e-mailed price of 24th October you are our preferred contractor for the supply and install of chafers/piles. The most likely scenario is that you would act as a nominated subcontractor to the main contractor Barry Hughes. The details of this will be discussed next week at the fortnightly site meeting. We will keep you informed.
We have looked at the programme and would think late January would be a likely start date for installation.
9 On 16 November 2006, there was a telephone conversation between Mr Lubich and Mr Cilia (the 16 November conversation). It seems to have been common ground that in the course of the conversation there was a discussion about who the respondent would be contracting with if its tender was acceptable to the appellant. But there was a dispute as to precisely what was said. Mr Lubich gave evidence that he told Mr Cilia the respondent's contract would be with Exmouth Marina. (Mr Lubich agreed in cross-examination that Exmouth Marina had not been mentioned prior to that point (ts 197)). Mr Cilia denied that. He said the discussion was as to whether the contract would be with the appellant or Barry Hughes, and that Exmouth Marina was not mentioned.
10 The primary judge found as a fact that Mr Lubich did not tell Mr Cilia that Exmouth Marina would be the contracting party. That finding is not challenged. His Honour appears, however, to have accepted that the 16 November conversation included discussion of the long-standing issue of whether the respondent's contract would be with the appellant or with Barry Hughes.
11 The following day, 17 November 2006, Mr Lubich sent an email to Mr Cilia in (relevantly) the following terms:
In spite of our conversation yesterday, Exmouth Marina Holdings will order the materials as quoted in your new spreadsheet directly.
Based on your spreadsheet contained in the e-mail below please proceed with the order with the following conditions …
12 Mr Cilia replied on 18 November 2006, in (relevantly) the following terms:
Thanks for [the] order.
(Page 5)
- Apologies for the amount of changes that we have done on the spread sheets over the course of time. This is because we have gone in at a low margin. Cost of accuracy is more important we do get it right (sic). Plus other changes that have been done on the way through.
The second spread sheet I sent yesterday is correct cost. This is $973,464.43 plus GST.
Plus extra chafers.
One of each length of chafers. Total including these four chafers will be $998,061.35.
We except (sic) the terms. I will send you terms of payment for the project now price has been finalised.
13 The respondent then commenced work and sent its first invoice in about January 2007, addressed to the appellant. The primary judge found that Mr Lubich asked that it be reissued in the name of Exmouth Marina and, to allay the respondent's concerns about payment, said that the appellant would 'pay the bills'; that if 'Exmouth [Marina] didn't pay, [the appellant] would' [31], [36]. Subsequent invoices were addressed to Exmouth Marina.
The finding of the primary judge
14 There were two issues before the primary judge. One concerned the contract price. The other was whether the respondent's contract was with the appellant or with Exmouth Marina. There is no appeal in respect of the finding of the primary judge as to the contract price and it is unnecessary to canvass his Honour's reasons in that regard. The appeal is solely concerned with whether the respondent's contract was with the appellant or with Exmouth Marina.
15 It must be said, with respect, that the reasons of the primary judge on that issue are not easy to follow. However, as I understand his Honour's reasons, he found that the contract was constituted by the exchange of emails on 17 and 18 November 2006, read in the light of the 16 November conversation. He considered that the contract was concluded by the email from Mr Cilia of 18 November.
16 As I have mentioned, the primary judge did not accept Mr Lubich's evidence that he told Mr Cilia in the 16 November conversation that the respondent's contract would be with Exmouth Marina. His Honour found that that did not occur. Rather, his Honour observed that the opening sentence of the email of 17 November 2006 suggested that the 16 November conversation was to the effect, not that Exmouth Marina
(Page 6)
- would be the contracting party, but rather that Exmouth Marina would not be involved in the contract [62]. (That Exmouth Marina was mentioned in some connection in the conversation also finds some support in the absence of any comment or enquiry by Mr Cilia, in his email of 18 November, concerning the reference to Exmouth Marina in Mr Lubich's email of 17 November.)
17 The primary judge found that the respondent had entered into the contract with the appellant, not with Exmouth Marina. His Honour said:
In my view, having regard to all of the evidence, the objective intention of the [respondent] was to contract with the [appellant] and not with any other party. It was not open to the [appellant], at the conclusion of the negotiations, to unilaterally nominate another entity as the contracting party [62].
18 The appellant appeals against his Honour's finding.
The grounds of appeal
19 The appellant relies upon four grounds of appeal. They are as follows:
1. The Learned Judge erred in law and fact in not making a finding about when a contract was made between the appellant and the respondent and what constituted that contract.
2. If by implication the Learned Judge found there was a contract that was partly oral and partly in writing made between the appellant and the respondent in or about October 2006, alternatively November 2006, for the respondent to manufacture and supply chafers and piles for use in the construction of a marina at Exmouth, the Learned Judge erred in law and fact in making that finding.
3. The Learned Judge erred in law and fact in finding it was not open to the appellant at the conclusion of negotiations to unilaterally nominate another entity as the contracting party.
4. The Learned Judge erred in law and fact in not finding on or about 17 November 2006 a contract was made between Exmouth Marina Holdings Pty Ltd and the respondent for the respondent to manufacture and supply chafers and piles for use in the construction of a marina at Exmouth.
The disposition of the appeal
20 As counsel for the appellant acknowledged in the course of argument, the appeal turns on ground 4, the other grounds being
(Page 7)
- subsidiary to that ground. It is therefore appropriate to turn at once to ground 4.
21 The principles to be applied in determining the identity of a contracting party are set out in the reasons for decision of Murphy JA, which I have had the benefit of reading in draft, but it is convenient to repeat the relevant passage from the decision of the New South Wales Court of Appeal in Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299, as follows:
The identity of the contracting party is to be determined looking at the matter objectively, examining and construing any relevant documents in the factual matrix in which they were created and ascertaining between whom the parties objectively intended to contract. This is, to a point, a process of construction similar to the task of identifying whether a clearly contractual document (such as a bill of lading) is made with one party or another (such as a shipowner or time charterer): Homburg Houtimport BV v Agrosin Private (at 770) and the cases considered in M Wilford, T Coghlin and J D Kimball, Time Charters 5th ed (2003) London, Lloyds of London Press, Ch 21. Where the documents are silent or ambiguous, but there is undoubtedly a contract, the identity of the parties must be determined objectively from the surrounding circumstances: see Barroora Pty Ltd v Provincial Insurance Ltd (1992) 26 NSWLR 170 at 174; Protean (Holdings) Ltd (receivers and managers appointed) v American Home Assurance Co (1985) 4 ANZ Insurance Cases 60–683 at 74,055-74,056; Coulls v Bagot's Executor and Trustee Company Ltd (1967) 119 CLR 460 at 477, 478-479 and 486. (304)
22 It is clear from the evidence that throughout the negotiations a live issue was whether, if the respondent's tender was successful, the appellant would enter into a contract direct with the respondent or whether the respondent would be a nominated subcontractor to the main contractor, Barry Hughes. In his evidence Mr Cilia said that 'the discussions all along' had been whether the respondent's contract would be with the appellant or Barry Hughes (ts 122). The issue was expressly mentioned in the email from Mr Lubich to Mr Cilia on 27 October 2006 and subsequently discussed in the 16 November conversation.
23 It appears from the evidence that only two matters were discussed in the 16 November conversation: one was Mr Lubich's concern about the number and accuracy of the spreadsheets being sent to him by the respondent, and the other was who the respondent would be contracting with if it was awarded the work. In relation to the latter, Mr Cilia gave evidence that as at 16 November '[t]here were still discussions on who the payments would come through, whether it was Barry Hughes or [the appellant]' (ts 43). He went on to say:
(Page 8)
- The only recollection I have of that phone conversation before this email [of 17 November 2006] is who would be paying us for the job, because it was - the conversation included whether it was coming through [the appellant] or Barry Hughes at that point (ts 44).
24 Mr Lubich's email of 17 November 2006 and, in particular, the opening sentence ('In spite of our conversation yesterday, Exmouth Marina Holdings will order the materials as quoted in your new spreadsheet directly') must be understood in the context of the discussion the previous day about who the contracting party would be. In my view, in that context it could only be understood as stating that, despite what had been discussed the previous day about who the respondent would be contracting with, Exmouth Marina would be the contracting party. The email went on to request that the respondent 'proceed with the order' subject to certain conditions. Mr Cilia responded (relevantly) simply by thanking Mr Lubich for '[the] order' and stating that the respondent accepted 'the terms'. Viewed objectively, the contract was made between the respondent and Exmouth Marina. (I should mention that Mr Lubich's authority was not put in issue.)
25 I do not consider that anything else in those emails is contrary to what, in my view, is the clear objective intention that the respondent's contract was with Exmouth Marina.
26 His Honour's conclusion that '[I]t was not open to the [appellant], at the conclusion of the negotiations, to unilaterally nominate another entity as the contracting party' [62] is, with respect, incorrect. In the first place, the question of who the contracting party would be had been recognised throughout the negotiations as a matter that had to be resolved. The nomination of a party other than the appellant was not sprung on the respondent at the last moment. In any event, before any contract was concluded with the appellant, it was clearly open to the appellant to nominate another entity as the contracting party. It was equally open to the respondent to refuse to enter into a contract with such a nominee. The respondent did not do so.
27 I consider that the primary judge was in error in concluding that the respondent's contract was with the appellant. In my opinion, the contract was between Exmouth Marina and the respondent.
28 I might mention that a good deal of attention was directed, both at trial and by the primary judge in his reasons, to whether regard could be had to post-contractual conduct in order to determine the parties to the contract. In my view, it is unnecessary to enter upon that question. That
(Page 9)
- is because I consider it to be clear that the respondent's contract was made with Exmouth Marina. I would add, however, that had it been necessary to look at the post-contractual conduct, I would have found the evidence as to that conduct to be of little assistance in resolving the issue and, in the end, it would not have altered my view.
Conclusion
29 I would uphold ground 4 of the grounds of appeal, set aside the decision of the primary judge and dismiss the respondent's action. I do not think it is necessary to consider the other grounds of appeal.
MURPHY JA:
Introduction
30 This is an appeal from a decision of the District Court in which the primary judge ordered the appellant (the defendant in the court below - 'City & Suburban') to pay liquidated damages to the respondent (the plaintiff - 'Gambetta') for breach of contract. The judge's reasons for judgment are found in Gambetta Holdings Pty Ltd v City & Suburban Group Pty Ltd [2010] WADC 124.
31 It was common ground, before the judge, that Gambetta had entered into a contract in 2006 to supply certain equipment (assembled chafers and piling, and some unassembled chafers as spares) for use in a marina project in Exmouth. There were two issues for resolution by the primary judge. One was the contractual price and the second was the identity of the other contracting party. On the second issue, Gambetta alleged that City & Suburban was the contracting party. City & Suburban disputed this, and alleged that the contract was with another company called Exmouth Marina Holdings Pty Ltd (Holdings Pty Ltd), with which it was associated.
32 As to the first issue, Gambetta contended that it was agreed that Gambetta would be paid $1,040,693.51 plus GST, but that the contract sum would be reduced by 5%, to $988,658.83, if its invoices were paid within seven days. Gambetta alleged that the invoices were not paid within seven days, and the higher sum was payable. City & Suburban, on the other hand, contended that the contract price did not involve a 5% discount for payment of invoices within seven days, and that the agreed price was simply $986,644.06 plus GST. The minor difference between Gambetta's figure of $988,658.83 (net of the alleged 5% discount) and
(Page 10)
- City & Suburban's figure of $986,644.06, was not explained in this appeal.
33 On the first issue, the judge found that the discount was not a term of the contract as alleged by Gambetta, and that it was not entitled to the alleged higher amount. On the second issue, the judge found that the contracting party was City & Suburban, and not Holdings Pty Ltd. In substance, it is this latter finding which City & Suburban challenges in this appeal. There is no cross-appeal by Gambetta in respect of the first issue.
34 For the reasons given below, I would dismiss the appeal.
The grounds of appeal
35 City & Suburban's principal challenge to the decision below is in ground 4 of its grounds of appeal, which reads:
4. The Learned Judge erred in law and fact in not finding on or about 17 November 2006 a contract was made between Exmouth Marina Holdings Pty Ltd and the respondent for the respondent to manufacture and supply chafers and piles for use in the construction of a marina at Exmouth.
36 Ground 4 is preceded by three other grounds of appeal as follows:
1. The Learned Judge erred in law and fact in not making a finding about when a contract was made between the appellant and the respondent and what constituted that contract.
2. If by implication the Learned Judge found there was a contract that was partly oral and partly in writing made between the appellant and the respondent in or about October 2006, alternatively November 2006, for the respondent to manufacture and supply chafers and piles for use in the construction of a marina at Exmouth, the Learned Judge erred in law and fact in making that finding.
3. The Learned Judge erred in law and fact in finding it was not open to the appellant at the conclusion of negotiations to unilaterally nominate another entity as the contracting party.
37 Although ground 2 alleges, in essence, the same error as ground 4, namely that the judge erred in finding a contract between the appellant and the respondent in November 2006, grounds 1 to 3, as counsel for City & Suburban acknowledged, point, in effect, to alleged errors by the primary judge for the purpose of elucidating the principal error contended
(Page 11)
- for in ground 4, and do not assist City & Suburban in this appeal if ground 4 itself is not made out.
The primary judge's findings
The findings concerning the contract
38 It must be acknowledged, at the outset, that the judge's reasons are somewhat difficult to construe as to what communications constituted or evidenced the contract, and when the contract was made. It would appear that his Honour found that the contract was 'partly oral and partly in writing' (reasons [60]). It also appears that his Honour considered that the following communications were relevant to the formation of the contract:
(a) A conversation between Mr Lubich of City & Suburban, and Mr Cilia for Gambetta, on 16 November 2006;
(b) Mr Lubich's email dated 17 November 2006 timed 4.57 pm; and
(c) Mr Cilia's email to Mr Lubich dated 18 November 2006 timed 1.34 pm (reasons [23] - [27]).
39 The judge recorded, with apparent approval, Gambetta's version of the conversation ([25], [62]) and thereby found, in effect, that the conversation on 16 November 2006 between Mr Lubich and Mr Cilia was to the effect that City & Suburban had not then decided whether to deal directly with Gambetta, or through Barry Hughes, the main contractor.
40 His Honour said that the emails referred to above 'would suggest that an agreement had been reached' by 18 November 2006 (reasons [24]). On the other hand, his Honour also said in [24] that 'uncertainty appeared to remain as to costs', and later said that there was evidence to the effect that the 'price ... was finalised as at 28 November 2006' (reasons [28]). The reference in the reasons to price being finalised as at 28 November 2006 appears to be an error (perhaps typographical, or perhaps induced by City & Suburban's counsel incorrectly describing, in the course of cross-examination at one point in the trial, the email of 18 November as being dated 28 November 2006 - ts 79). In any event, the evidence of Mr Cilia was, relevantly (ts 80):
So even as late as 17 November the price was still moving around. And it got fixed, as far as you're concerned, at that time, at 18 November. That's when the price was finalised?---Yes. Yes.
(Page 12)
The dispatch of invoices
41 The judge found, in effect, that pursuant to a contract between Gambetta and City & Suburban, Gambetta sent its first invoice in about January 2007. The invoice was issued by Gambetta to City & Suburban. However, Mr Lubich subsequently requested Mr Cilia of Gambetta, in about late January or early February 2007, to reissue the invoice in the name of Holdings Pty Ltd, and, at the same time, assured Mr Cilia that City & Suburban 'would pay the bills' (reasons [29] - [36], [63]). In consequence, invoices were thereafter issued to Holdings Pty Ltd.
Negotiations between April 2006 and November 2006
42 The judge made findings as to the following negotiations in the period 4 April 2006 to 17 November 2006 (reasons [13] - [23]):
(a) On 4 April 2006, Mr Warren, a director of City & Suburban (and of Holdings Pty Ltd, the existence of which company was then unknown to Gambetta), emailed Gambetta. The email from Mr Warren came from '[email protected]'. The email invited Gambetta to discuss 'products and ideas' and suggested that Gambetta should contact Mr Lubich;
(b) Mr Lubich was an architect in the employ of City & Suburban (not Holdings Pty Ltd);
(c) on 19 April 2006, on City & Suburban letterhead, Mr Lubich sent a facsimile to Gambetta enclosing certain tables and calculations and other technical material in relation to the Exmouth marina project;
(d) in various meetings commencing in May 2006, Mr Lubich, of City & Suburban, discussed the project with representatives of Gambetta;
(e) on 3 July 2006, Gambetta emailed Mr Lubich at '[email protected]' seeking, in effect, a scope of works;
(f) Mr Lubich replied on the same day, 3 July 2006, stating that the information would be prepared 'early next week'. That email came from '[email protected]';
(g) on 27 September 2006, Gambetta wrote to Mr Lubich, providing a breakdown of certain costs relating to chafers and seeking, in
- effect, Mr Lubich's confirmation that it was worth Gambetta proceeding to quote for the project;
- (h) on 5 October 2006, Gambetta, by email to Mr Lubich, provided an updated quote;
(i) during the remainder of October 2006, various emails passed between '[email protected]' and Gambetta in relation to the supply of materials for the project;
(j) by email dated 27 October 2006, from '[email protected]', Mr Lubich advised Gambetta that 'you are our preferred contractor for the supply and install of chafers/piles. The most likely scenario is that you would act as a nominated subcontractor to the main contractor, Barry Hughes. The details of this will be discussed next week ... '. (emphasis added)
43 The judge also found, in effect, ([23], [27]), that in the negotiations with Gambetta, there was no mention of 'Exmouth Marina Holdings' or Holdings Pty Ltd prior to the reference in Mr Lubich's email of 17 November 2006 at 4.57 pm.
44 Although not mentioned by the judge, it is convenient to record here three further facts:
• Mr Cilia provided Mr Lubich with a quote on 7 November 2006 which he described as 'updated cost for chafers' (GB 37);
• Arrangements were then made for a site meeting in Exmouth on 14-16 November to discuss 'site conditions' and 'schedule, costs' (GB 36); and
• By email dated 17 November 2006 at 3.15 pm, Gambetta sent to Mr Lubich, amongst others, a further updated spreadsheet for costs (GB 16), to which Mr Lubich's email dated 17 November 2006 of 4.57 pm (see subpar (b) of [38] above) was the reply.
The relevant legal principles
45 The following expositions of principle are relevant for present purposes.
46 In Ryledar Pty Ltd v Euphoric Pty Ltd [2007] NSWCA 65; (2007) 69 NSWLR 603, Campbell JA (with whom Mason P agreed) said [262]:
(Page 14)
- For the purpose of deciding whether a contract has been entered, or what construction it bears, the common intention that the court seeks to ascertain is what is sometimes called the 'objective intention' of the parties. That is the intention that a reasonable person, with the knowledge of the words and actions of the parties communicated to each other, and the knowledge that the parties had of the surrounding circumstances, would conclude that the parties had, concerning the subject matter of the alleged contract: Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461 [22]; Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd(2004) 219 CLR 165 at 179 [40]; Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 912–913; 1 All ER 98 at 114–115; Taylor v Johnson(1983) 151 CLR 422 at 429; Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd(1988) 18 NSWLR 540 at 549–550.
47 Further, in Air Tahiti Nui Pty Ltd v McKenzie [2009] NSWCA 429; (2009) 77 NSWLR 299, Allsop P and Handley AJA (Hodgson JA agreeing) said [28]:
The identity of the contracting party is to be determined looking at the matter objectively, examining and construing any relevant documents in the factual matrix in which they were created and ascertaining between whom the parties objectively intended to contract. This is, to a point, a process of construction similar to the task of identifying whether a clearly contractual document (such as a bill of lading) is made with one party or another (such as a shipowner or time charterer): Starsin at [132] and the cases considered in M Wilford et al Time Charters, 5th Ed, Informa Publishing, 2003, Ch 21. Where the documents are silent or ambiguous, but there is undoubtedly a contract, the identity of the parties must be determined objectively from the surrounding circumstances: see Barroora Pty Ltd v Provincial Insurance Ltd (1992) 26 NSWLR 170 at 174; Protean (Holdings) Ltd v American Home Assurance Co (1985) 4 ANZ Ins Cas 60-683 at 74,055–74,056; Coulls v Bagot's Executor and Trustee Co Ltd [1967] HCA 3; 119 CLR 460 at 477, 478–479 and 486.
48 Similarly, in Scottish Amicable Life Assurance Society v Reg Austin Insurances Pty Ltd (1985) 9 ACLR 909, 923, McHugh JA (as he then was) said:
A commercial document, however, must be construed in its commercial setting - in accordance with the surrounding circumstances known to the parties: Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 at 352-353. This is so whether the issue concerns construction in the strict sense or whether, as here, the issue concerns the capacity in which a person signs a document.
(Page 15)
Disposition of the appeal
49 City & Suburban's principal argument in this appeal is to the effect that the judge erred in not finding a contract between Gambetta and Holdings Pty Ltd on or about 17/18 November 2006 evidenced by the exchange of emails on 17 and 18 November 2006.
50 Having regard to the matters in [38] - [40], in my view, the judge's reasons, read as a whole and properly construed, indicate that he found a contract on or about 17/18 November 2006; but he found that it was between Gambetta and City & Suburban.
51 The emails read, relevantly, as follows.
52 In Mr Lubich's email dated 17 November 2006 at 4.57 pm, he wrote to Gambetta:
From: Stephen Lubich [mailto:[email protected]]
Sent: Friday, 17 November 2006 16:57
...
Subject: RE: Cost
Leno
In spite of our conversation yesterday, Exmouth Marina Holdings will order the materials as quoted in your new spreadsheet directly.
Based on your spreadsheet contained in the e-mail below please proceed with the order with the following conditions;
1) We are ordering the following extra chafers as spares, to be kept down here, unassembled, for use as spare parts if required.
150 x 9 SHS x 1/200 x 9 SHS x 1/250 x 9 (-3.70 canals) x 1
2) Total cost excluding exclusions detailed below, and additional chafers described above is $957,962.43 ex gst.
3) Liabilities for errors, if any, within the spreadsheet will be EWS's.
A separate price for installation will be forwarded as soon as possible
If you have any questions, give me a call.
Regards
Steve Lubich
53 The 'new spreadsheet' referred to by Mr Lubich appears to be a reference to a spreadsheet forwarded by Gambetta to Mr Lubich earlier that day by email at 3.15 pm.
(Page 16)
54 Mr Cilia's email dated 18 November 2006 to Mr Lubich said, relevantly:
Thanks for order.
Apologies for the amount of changes that we have done on the spreadsheets over the course of time. This is because we have gone in at a low margin. Cost of accuracy is more important we do get it right. Plus other changes that have been done on the way through.
...
We except [sic accept] the terms. I will send you terms of payment for the project now price has been finalized.
55 In my view, City & Suburban has not shown that the judge erred in finding that the contract was between it and Gambetta.
56 First, the meaning and effect of Mr Lubich's email dated 17 November 2006 is to be understood in the context of the preceding conversation of 16 November 2006, to which the email expressly refers. In light of the judge's findings as to that conversation (see [39] above), a reasonable person in Gambetta's position receiving Mr Lubich's email would understand that an important aspect of the first sentence of the email was to advise that the contract for the supply of materials for the marina would be with Gambetta directly and would not involve Barry Hughes.
57 Secondly, all negotiations since April 2006 had been with City & Suburban. The reference to 'Exmouth Marina Holdings' would be understood in the context that Gambetta had never previously heard of 'Exmouth Marina Holdings' and knew nothing about it. There was nothing in the email to suggest that 'Exmouth Marina Holdings' was a company, as opposed to a business name, trading name, or a 'division' of City & Suburban.
58 Thirdly, the words 'Exmouth Marina Holdings will order' would be read not in isolation from the rest of the email, but would be read in connexion with the following two sentences. The next sentence says, inter alia, 'Based on your spreadsheet ... please proceed with the order'. That direction is apparently given by City & Suburban, particularly as Mr Lubich's email was responding to Mr Cilia's 'new spreadsheet' sent to City & Suburban under cover of Mr Cilia's email of 17 November 2006 at 3.15 pm. The following sentence then commences with the words 'We are
(Page 17)
- ordering' (emphasis added). Again, the word 'we' is apparently a reference to City & Suburban.
59 In this context, even if a reasonable person in Gambetta's position would have inferred that 'Exmouth Marina Holdings' was a legal entity separate from City & Suburban, the words 'Exmouth Marina Holdings will order the materials' could reasonably be understood as conveying the notion that 'Exmouth Marina Holdings' would be the party on behalf of City & Suburban which would in the future require physical delivery of the goods to be supplied under the contract formed by an acceptance of the offer contained in the email.
60 Fourthly, there was nothing in Mr Cilia's email of 18 November 2006 to indicate that Gambetta was communicating its acceptance to an entity other than the entity by whom Mr Lubich was employed, namely, City & Suburban.
61 For these reasons, ground 4 of the grounds of appeal does not succeed.
62 As indicated earlier, the primary focus was on ground 4. I will, nevertheless, briefly deal with the other three grounds.
63 Ground 1 was to the effect that the judge erred in not making a finding as to when the contract was entered into and the communications which constituted the contract. In my view, although there are difficulties in construing the judge's reasons, on balance, they may be read as the judge having found the contract was entered into in November 2006 comprising the conversation on 16 November 2006 and the emails on 17 and 18 November 2006. I would dismiss ground 1.
64 Ground 2 alleges, relevantly, that insofar as the judge found that there was a contract partly oral and partly in writing made in or about November 2006 between Gambetta and City & Suburban, the judge erred. For the reasons given earlier, this ground does not succeed.
65 Ground 3 alleges that the judge erred in finding that it was 'not open to the appellant at the conclusion of negotiations to unilaterally nominate another entity as the contracting party'. Again, the judge's finding is somewhat difficult to construe. As best I understand it, his Honour was indicating that it was not open for City & Suburban to contend that Mr Lubich's email of 17 November 2006 constituted a counter-offer by Holdings Pty Ltd, having regard to the negotiations up to that point, and the other terms of that email, and Mr Cilia's reply dated 18 November
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- 2006. If that is what his Honour meant, no error is shown. If his Honour meant something different, it is immaterial to the outcome of the appeal because his Honour properly concluded that the contract was between Gambetta and City & Suburban.
Conclusion
66 The appeal should be dismissed.
67 HALL J: I agree with Murphy JA.
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