COREY & JEBBETT

The parties in this matter were Corey and Jebbett. The dispute concerned the interpretation of a clause within a deed of settlement, specifically whether it imposed a personal obligation on Mr Jebbett to pay a sum of money to Corey, or whether it was merely an acknowledgement of a debt that was otherwise unenforceable. The case was heard by Kent J in the Supreme Court of Victoria.

The central legal issue before the Court was whether the wording of clause 4 of the deed of settlement created a personal covenant by Mr Jebbett to pay the sum of $150,000 to Corey, or if it was merely an acknowledgement of a pre-existing debt that had not been validly assigned. The Court was required to determine the intention of the parties as expressed in the deed and the legal effect of that wording in the context of assignment of choses in action.

Kent J reasoned that the language of clause 4, which stated "Mr Jebbett acknowledges that he is indebted to Corey in the sum of $150,000 and agrees to pay this sum to Corey", constituted a clear and unambiguous personal covenant by Mr Jebbett to pay the specified amount. His Honour found that the use of the word "agrees" indicated a promise to perform an action, thereby creating a personal obligation. The Court applied the principle that the intention of the parties to a deed is to be gathered from the language used within the deed itself, and that clear and unambiguous language should be given its ordinary meaning. The Court rejected the argument that the clause was merely an acknowledgement of debt without a personal undertaking to pay, finding that such an interpretation would render the inclusion of the word "agrees" superfluous and contrary to the plain meaning of the text.

The Court ordered that Mr Jebbett was personally liable to pay Corey the sum of $150,000 pursuant to clause 4 of the deed of settlement.