Fiona & John Sinclair Pty Ltd v Burns Bay Services Pty Ltd - [2023] NSWSC 789

Supreme Court

New South Wales

Medium Neutral Citation: Fiona & John Sinclair Pty Ltd v Burns Bay Services Pty Ltd [2023] NSWSC 789
Hearing dates: 5 and 6 October 2022
Date of orders: 07 July 2023
Decision date: 07 July 2023
Jurisdiction: Equity
Before: Henry J
Decision:
Binding settlement agreement entered into. See [187]–[190].

Catchwords:
CONTRACTS — formation — agreement — whether parties entered into a binding agreement to settle these and related proceedings upon signing settlement document at mediation — where no lawyers present at mediation and settlement document drafted by mediator described as a deed — where parties signed as directors of corporate parties and not separately as individual parties — where signed settlement document does not take effect as a valid deed — whether parties objectively intended to be immediately bound — whether individual parties objectively intended to be bound

Legislation Cited:
Civil Procedure Act 2005 (NSW)
Conveyancing Act 1919 (NSW)
Corporations Act 2001 (Cth)
Uniform Civil Procedural Rules 2005 (NSW)

Cases Cited:
400 George Street (Qld) Pty Ltd v BG International Limited [2012] 2 QD r 302; [2010] QCA 245
Baulkham Hills Private Hospital Pty Ltd v GR Securities Pty Ltd (1986) 40 NSWLR 622
Bombardier Inc v Avwest Aircraft Pty Ltd [2020] WASCA 2
Clark Equipment Credit of Aust Ltd v Kiyose Holdings Pty Ltd (1989) 21 NSWLR 160
GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631
Guang Dong Zhi Gao Australia Pty Ltd v Fortuna Network Pty Ltd [2009] NSWSC 1170
Harris v Burrell & Family Pty Ltd (2010) 271 LSJS 326; [2010] SASCFC 12
Jingalong Pty Ltd v Todd [2015] NSWCA 7
Levitt v Illawarra Seafood Pty Ltd (No 2) (1983) 3 BPR 9137
Masters v Cameron (1954) 91 CLR 353; [1954] HCA 72
Michael Kuehn & Jennifer Kuehn v Masterton Homes (NSW) Pty Ltd (t/as Masterton Homes (NSW) Pty Ltd) [2020] NSWSC 1049
Netglory Pty Ltd v Caratti [2013] WASC 364
Nurisvan Investment Ltd v Anyoption Holdings Ltd [2017] VSCA 141
Pavlovic v Universal Music Australia Pty Ltd (2015) 90 NSWLR 605; [2015] NSWCA 313
Prime Constructions Pty Ltd v Westbridge Investments Pty Ltd (2004) 22 ACLC 1390; [2004] NSWSC 861
Singh v De Castro; Dhaliwal v De Castro; Brar v De Castro [2017] NSWCA 241
Thomson v Harding (1853) 2 El & Bl 630; (1853) 118 ER 904
Vickers v Bell (1864) 46 ER 924

Texts Cited:
J R Martyn and N Caddick, Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (20th ed, 2013, Thomson Reuters)
N Seddon, Seddon on Deeds (2nd ed, 2022, The Federation Press)

Category: Principal judgment
Parties: Fiona & John Sinclair Pty Ltd (Plaintiff/First Respondent)
Burns Bay Services Pty Ltd (Defendant/First Applicant)
Ashod Balanian (Second Applicant)
Launch Partners Pty Ltd (Third Applicant)
Penelope Richards as personal representative of John Sinclair (Second Respondent)
Fiona Sinclair (Third Respondent)
Representation:
Counsel:
T Brennan SC with T Crispin (Plaintiff/Respondents)
A Cheshire SC with M Cobb-Clark (Defendant/Applicants)
Solicitors:
AR Conolly & Company…

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: [2023] NSWSC 789
Decision Date: 07 July 2023

CaseChat Overview and Summary

In the Federal Circuit Court, Fiona and John Sinclair Pty Ltd brought proceedings against Burns Bay Services Pty Ltd, seeking to enforce a settlement agreement reached during mediation. The primary dispute centred on whether the parties had entered into a binding agreement upon signing a settlement document at the mediation, despite the absence of legal representatives and the document being drafted by the mediator as a deed. The Sinclairs argued that the agreement should be enforceable as a binding contract, while Burns Bay Services contended that the document did not take effect as a valid deed and that there was no objective intention to be immediately bound.

The court had to determine whether the settlement document constituted a binding agreement and if the parties intended to be immediately bound by it. Key issues included the absence of legal representation during the mediation, the description of the settlement document as a deed, and the manner in which the parties signed the document—as directors of the corporate entities rather than as individuals. The court examined whether the parties objectively intended to be immediately bound by the settlement agreement, even though the document did not effectively operate as a deed.

The court concluded that while the parties had signed the settlement document as directors of the corporate entities, this did not preclude the possibility of them also being individually bound by the agreement. The court found that the absence of legal representation did not undermine the enforceability of the agreement if there was a clear intention to be immediately bound. Additionally, the court held that the description of the document as a deed did not preclude the possibility that the parties intended to be bound by it as a contract. The court determined that there was an objective intention to be immediately bound by the settlement terms, despite the document not taking effect as a valid deed.

The court ordered that the settlement agreement be enforced as a binding contract, with the terms outlined in the document to be adhered to by both parties. The Sinclairs were entitled to the relief sought in their original proceedings, in accordance with the terms of the settlement agreement.

Orders