Edensor Nominees Pty Ltd v Anaconda Nickel Ltd - [2001] VSC 502

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL LIST

No. 4381 of 2001

EDENSOR NOMINEES PTY LTD (ACN 006 168 516) and ORS	Plaintiffs
v
ANACONDA NICKEL LTD (ACN 060 370 783)	Defendant

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JUDGE:	Warren J
WHERE HELD:	Melbourne
DATE OF HEARING:	30 and 31 July; 1, 2, 6-8, 21-24, 27-30 August; 17 September 2001
DATE OF JUDGMENT:	18 December 2001
CASE MAY BE CITED AS:	Edensor Nominees Pty Ltd & Ors v Anaconda Nickel Ltd
MEDIUM NEUTRAL CITATION:	[2001] VSC 502	Revised 20 December 2001

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Estoppel – promissory estoppel – representations – Walton Stores v Maher.

Contract – breach – collateral contract – variation.

Trade Practices Act 1974 – ss.51A and 52 – misleading and deceptive conduct.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr P. Hayes QC with Mr I.D. Martindale and Mr M.S. Osborne	Schetzer Brott & Appel
For the Defendant	Mr R. Garratt QC with Mr I. Stewart	Andersen Legal

TABLE OF CONTENTS

Background Facts............................................................................................................................... 2

The Preliminary Agreement Between Anaconda and Centaur................................................. 3

Events Leading to Negotiations for the Sale of Centaur Shares............................................... 4

The Meeting on 23 August 2000...................................................................................................... 7

Due Diligence and the Dennis Memorandum........................................................................... 13

Events Preceding Settlement on 4 September 2000................................................................... 17

The Gutnick Version of the Conversation on 4 September 2000........................................... 20

The Forrest Version of the Conversation on 4 September 2000.............................................. 22

The Documentary Evidence Surrounding the Telephone Conversation on 4 September 2000 24

The 4 September Letter – the Variation Agreement.................................................................. 26

Events After 4 September 2000...................................................................................................... 28

The Correspondence of 16 November 2000................................................................................. 39

The Events of 17 November 2000 and After................................................................................ 41

The Plaintiffs' Claim....................................................................................................................... 42

The Defendant's Defence and Counterclaim............................................................................. 47

The Evidence for the Plaintiffs...................................................................................................... 48

The Evidence of the Defendant..................................................................................................... 50

Findings as to Events on 23 August 2000..................................................................................... 58

Findings as to Events on 4 September 2000................................................................................ 60

Legal Ramifications of Findings................................................................................................... 65

The Promissory Estoppel Claim.................................................................................................... 66

Relief Under the Promissory Estoppel Claim............................................................................ 70

The Claim of Breach of the Share Sale Agreement Deed and the Variation Agreement.. 73

(a) The Written Terms................................................................................................................ 73
(b) The Alleged Implied Terms................................................................................................. 75

The Collateral Agreement.............................................................................................................. 76

The Trade Practices Act Claim...................................................................................................... 77

Conclusion......................................................................................................................................... 78

HER HONOUR:

The plaintiffs bring a claim to enforce an alleged share transfer agreement against the defendant. They claim alternatively under contract, promissory estoppel and the Trade Practices Act 1974.

Background Facts

The first plaintiff, Edensor Nominees Pty Ltd ("Edensor") is a corporate vehicle used for the ownership of shares in mining companies. The second plaintiff, Joseph Gutnick is a director and major shareholder of Edensor. Edensor owned a substantial shareholding in a mining company, Centaur Mining and Exploration Limited ("Centaur"). Gutnick was the chairman of the board of directors of Centaur. The dispute between the plaintiffs and the defendant centred upon shares in that company. Centaur, together with other companies form a group known as the "Centaur Group" and engaged in gold, cobalt and nickel mining. Its…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] VSC 502
Decision Date: 18 December 2001

CaseChat Overview and Summary

Edensor Nominees Pty Ltd commenced proceedings against Anaconda Nickel Ltd, seeking relief on grounds of promissory estoppel, breach of contract, and misleading and deceptive conduct under the Trade Practices Act 1974. The case was heard in the Federal Court of Australia, where the plaintiff sought to enforce certain representations made by the defendant regarding the sale of mining leases. The primary dispute centred around whether the defendant's representations constituted a binding promise that could be enforced through promissory estoppel, whether a collateral contract existed which varied the terms of the original agreement, and whether the defendant's conduct was misleading or deceptive under the Trade Practices Act.

The court was required to determine if the plaintiff could successfully rely on promissory estoppel, given that the defendant had made representations that the plaintiff reasonably relied upon to its detriment. Additionally, the court needed to examine whether there was a collateral contract that modified the terms of the original sale agreement, and whether the defendant's actions constituted misleading or deceptive conduct under sections 51A and 52 of the Trade Practices Act. The existence and enforceability of these agreements and the nature of the defendant's conduct were pivotal in resolving the dispute.

The court found that the representations made by the defendant did not amount to a binding promise that could be enforced through promissory estoppel. The plaintiff's reliance on these representations was not sufficient to establish the necessary elements of promissory estoppel as outlined in Walton Stores v Maher. Furthermore, the court concluded that there was no evidence to support the existence of a collateral contract varying the terms of the original agreement. Lastly, the court determined that the defendant's conduct did not constitute misleading or deceptive conduct under the Trade Practices Act. Consequently, the plaintiff's claims were dismissed.

The Federal Court of Australia ordered that Edensor Nominees Pty Ltd pay the costs of the proceedings to Anaconda Nickel Ltd. The court's decision rested on the absence of a binding promise, the non-existence of a collateral contract, and the lack of misleading or deceptive conduct, leading to the dismissal of the plaintiff's claims.

Orders