Halikos Hospitality Pty Ltd & Ors v INPEX Operations Australia Pty Ltd
[2020] NTCA 4
•20 March 2020
CITATION:Halikos Hospitality Pty Ltd & Ors v INPEX Operations Australia Pty Ltd [2020] NTCA 4
PARTIES:HALIKOS HOSPITALITY PTY LTD
(ACN 143 433 998)
and
HALIKOS PTY LTD
(ACN 092 987 463)
and
HALIKOS INVESTMENTS PTY LTD
(ACN 009 639 221)
and
HALIKOS NT PTY LTD
(ACN 159 722 620)
v
INPEX OPERATIONS AUSTRALIA PTY LTD (ACN 150 217 262)
TITLE OF COURT: COURT OF APPEAL OF THE NORTHERN TERRITORY
JURISDICTION: CIVIL APPEAL from the SUPREME COURT exercising Territory jurisdiction
FILE NO:AP 4 of 2019 (21611352)
DELIVERED: 20 March 2020
HEARING DATES: 4, 5 September, 20, 21, 22 November 2019
JUDGMENT OF: Southwood and Hiley JJ, and Riley AJ
CATCHWORDS:
APPEALS – general principles – functions of appellate court – appellate court to conduct a “real review” of the evidence and trial judge’s reasons to determine whether the trial judge has erred – appellate restraint before interfering with trial judge’s findings of fact – appellant not required to show that the trial judge’s findings are “glaringly improbable” or “contrary to compelling inferences” unless the findings are partly based upon the trial judge’s observations of the witness
APPEALS – Courts and Judges – delay before announcing judgement – delay between announcing judgment and publishing reasons for judgment – relevant principles – appellate intervention flows from the error, or the infirmity of the decision, not the delay itself – lengthy delay may weaken a trial judge’s advantage of having seen the oral and documentary evidence unfold in a coherent manner – No error or infirmity established – trial judge gave careful and detailed consideration to the whole of the evidence – appeal dismissed
AGENCY – No actual authority of officers of the respondent to bind respondent – No ostensible authority – knowledge by both parties of detailed decision-making process required by the respondent – appeal dismissed
CONTRACT – Formation – Single contract – Not two contracts – No intention to enter into binding contractual relations – negotiations incomplete – parties still negotiating a single agreement broader than that alleged second agreement – appeal dismissed
EQUITY – Estoppel by convention – failure to establish mutual assumption – No error by the trial judge – appeal dismissed
EQUITY – Estoppel by representation – failure to establish representation – failure to establish reliance – no error by the trial judge – appeal dismissed
AUSTRALIAN COMPETITION LAW – Misleading and deceptive conduct – failure to establish misrepresentation – no error by the trial judge – appeal dismissed
Competition and Consumer Act 2010 (Cth) s 128, s 236
Camden v McKenzie [2008] 1 Qd R 39, Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95, Expectation Pty Ltd v PRD Realty Pty Ltd (2004) 140 FCR 17, Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd (2001) 4 VR 28, Fox v Percy [2003] 214 CLR 118, John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451, Lee v Lee (2019) 93 ALJR 993, Lemongrove Services Pty Ltd v Rilroll Pty Ltd [2019] NSWCA 174, Nais and Others v Minister for Immigration and Multicultural and Indigenous Affairs and Another (2005) 228 CLR 470, Re Kit Digital Australia Pty Ltd (in liq) [2014] NSWSC 1547, Robinson Helicopter Co Inc v McDermott (2016) 90 ALJR 679, Watson v Foxman (1995) 49 NSWLR 315, applied
Palmer v Clarke (1989) 19 NSWLR 158, Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387, distinguished
Aldi Foods Pty Ltd v Moroccanoil Israel Ltd [2018] FCAFC 93, Aneve Pty Ltd v Bank of Western Australia Ltd [2005] NSWCA 441, Australian Red Cross Society v Queensland Nurses’ Union of Employees [2019] FCAFC 215, Briginshaw v Briginshaw (1938) 60 CLR 336, Briginshaw v Briginshaw (1938) 60 CLR 336, CSR Ltd v Della Maddalena (2006) 80 ALJR 458, Dearman v Dearman (1908) 7 CLR 549, Franklins Pty Ltd v Metcash Trading Ltd (2009) 76 NSWLR 603, Fuge v Commonwealth Bank of Australia [2019] FCA 1621, Gardenisle Pty Ltd v Johnson [2019] WASC 271, Grandulovic v Borg Warner (Australia) Pty Ltd (Unreported, NSWCA, 1 December 1987), Ingot Capital Investments v Macquarie Equity Capital Markets (No. 6) [2007] NSWSC 124, Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151, Kakavas v Crown Melbourne Ltd (2013) 250 CLR 392, King & Ors v Australian Securities and Investments Commission [2018] QCA 352, Masters v Cameron (1954) 91 CLR 353, Minister for Immigration and Border Protection v SZVFW [2018] HCA 30; (2018) 264 CLR 541, Moukhayber v Cambden Timber and Hardware Co Pty Ltd [2002] NSWCA 58, New South Wales v Hunt (2014) 86 NSWLR 226, Northside Developments Pty Ltd v Registrar General (1989) 170 CLR 146, Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451, Poulet Frais Pty Ltd v The Silver Fox Company Pty Ltd (2005) 220 ALR 211, Re Hillsea Pty Ltd [2019] NSWSC 1152, Re Sundell [2019] NSWSC 1108, Rollings v Rollings (2009) 230 FLR 396, S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466, State Rail Authority of NSW v Earthline Constructions Pty Ltd (In liq) (1999) 73 ALJR 306, Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237, Szeto v Situ [2017] NSWCA 135, Thorne v Kennedy (2017) 263 CLR 85, Warren v Coombes (1979) 142 CLR 531, Waterways Authority v Fitzgibbon (2005) 79 ALJR 1816, White v Philips Electronics Australia Ltd t/as Philips Healthcare [2019] NSWCA 115, referred to
REPRESENTATION:
Counsel:
Appellants:RJ Whitington QC with RD Williams
Respondent: PE Cahill SC with N Christrup SC
Solicitors:
Appellants:Finlaysons
Respondent: Corrs Chambers Westgarth
Judgment category classification: B
Number of pages: 178
IN THE COURT OF APPEAL
OF THE NORTHERN TERRITORY
OF AUSTRALIA
AT DARWINHalikos Hospitality Pty Ltd & Ors v INPEX Operations
Australia Pty Ltd [2020] NTCA 4No. AP 4 of 2019 (21611352)
HALIKOS HOSPITALITY PTY LTD
(ACN 143 433 998)
First Appellant
HALIKOS PTY LTD
(ACN 092 987 463)
Second Appellant
HALIKOS INVESTMENTS PTY LTD (ACN 009 639 221)
Third Appellant
HALIKOS NT PTY LTD
(ACN 159 722 620)
Fourth Appellant
AND:
INPEX OPERATIONS AUSTRALIA PTY LTD
(ACN 150 217 262)
Respondent
CORAM: SOUTHWOOD and HILEY JJ, and RILEY AJ
REASONS FOR JUDGMENT
(Delivered 20 March 2020)
Contents
INTRODUCTION
GROUNDS OF APPEAL
GROUNDS 1 – 3
EVIDENCE GROUNDS – general considerations
GROUND 5 – Two Agreements
GROUND 6
GROUND 7
GROUND 8
GROUND 9 – Intention to enter into legal relations
GROUND 10 – Estoppel by convention principles
GROUNDS 11 – 13 – estoppels and representations
GROUND 4
INTRODUCTION
This is an appeal against a decision of the Supreme Court dismissing the appellants’ (Halikos) claims against the respondent (INPEX) in contract, estoppel, and misleading and deceptive conduct arising out of certain protracted negotiations which, if successful, would have resulted in Halikos becoming the primary accommodation provider for INPEX for employees and contractors engaged in the construction and operation of the Ichthys LNG Project (the Project) at Bladin Point near Darwin.
INPEX is the agent and operator appointed by joint venturers to construct and operate the onshore and offshore processing facilities for the Project. On 15 February 2012 Halikos Hospitality Pty Ltd and INPEX entered into a contract for Halikos Hospitality Pty Ltd to provide accommodation for the Project. The contract was titled “INPEX Accommodation – Darwin, contract number 800575” (the 2012 Accommodation Agreement).
Halikos alleges that:
(i) on 13 February 2014 Halikos Hospitality Pty Ltd and INPEX entered into an agreement to vary the Accommodation Agreement (Additional Accommodation Variation[1] or AAV);
(ii) the terms of the AAV are contained in a document titled “Variation of Contract Number 800575" (Variation Document[2]);
(iii) pursuant to the AAV, INPEX agreed to take from Halikos not less than 225 (later reducing to not less than 150) apartments and hotel rooms for a 15-year period; and
(iv) the AAV was repudiated by INPEX on either 15 October or 20 November 2014.
Halikos contended that in order to provide the accommodation specified in the AAV, and in reliance on the parties’ entry into the AAV, Halikos demolished its existing properties at 105 Mitchell Street, Darwin and undertook a $46.75 million development of that site, which primarily involved the construction of a 180 room apartment complex (H105).
Halikos contended that after 13 February 2014, INPEX, particularly through its director and company secretary Hitoshi Okawa and its senior executives Christopher Wheeldon (General Manager – Construction) and Sean Kildare (General Manager, INPEX Darwin office), among other things, assured Halikos that an agreement had been entered into and that INPEX would take all the accommodation in H105 once its construction was completed, and required Halikos to hurry up and complete the build of H105. Without the assurance from INPEX, Halikos would not have proceeded. But on 15 October 2014, Okawa san informed Halikos for the first time that INPEX considered that there was no binding agreement and it did not require the additional accommodation. By this time, the development of H105 had proceeded to such a stage that Halikos had no alternative but to carry it to completion. As a result Halikos commenced an action for breach of contract against INPEX in the court below.
Alternatively to its claim for breach of contract, Halikos claimed that, by reason of INPEX failing to correct any mistaken belief of Halikos that there was or would be an agreement in the form of the AAV and/or by reason of INPEX’s conduct in the period between 13 February 2014 and 15 October 2014, INPEX was estopped from denying there was an agreement in the form of the AAV.
In the event that: (i) there was no AAV agreement, and (ii) the principles of estoppel did not apply, Halikos claimed the same conduct of INPEX which was said to ground the estoppel constituted misleading and deceptive conduct contrary to s 128 of the Competition and Consumer Act 2010 (Cth) sch 2 (Australian Consumer Law) and INPEX was thereby liable under s 236 to compensate Halikos on the basis that, but for the misleading and deceptive conduct, Halikos would not have demolished the existing building at 105 Mitchell Street, undertaken the development of H105, and foregone three other profitable development opportunities.
On the basis of its contract and estoppel claims, Halikos claimed losses as at 31 December 2016 of $144,814,326. On the basis of its misleading and deceptive conduct claim, Halikos claimed losses as at 31 December 2016 of $57,487,000. Halikos prosecuted claims for loss of anticipated profits on the development by way of expectation damages and, in the alternative, the loss occasioned by foregone alternative investment opportunities by way of reliance damages for misleading or deceptive conduct in contravention of the Australian Consumer Law.
INPEX denied the existence of the alleged AAV contract and denied that it made the alleged promises or representations that form the basis of Halikos’ other claims.
The trial judge delivered her Reasons for Decision on 13 February 2019 (Reasons or R). Her Honour accepted the evidence of INPEX’s witnesses, largely rejected the evidence of Halikos’ witnesses, and dismissed Halikos’ claims. Her Honour also held that:
(a)Halikos’ contract claims failed because:
(i) Halikos did not establish that Mr Kildare and Mr Wheeldon had any authority (ostensible or otherwise) to enter into the AAV with Halikos;[3] and
(ii) in any event, the parties had no intention to enter into legal relations by participating in the events of 13 February 2014;[4]
(b)Halikos’ estoppel claims failed because:
(i) for the claim of conventional estoppel – Halikos failed to establish the parties adopted a mutual assumption that they had entered into a binding agreement;[5]
(ii) for the claim of estoppel by representation – Halikos failed to establish that the pleaded representation was made;[6]
(c)Halikos’ misleading or deceptive conduct claims failed because:
(i) her Honour did not accept that the Halikos witnesses, Mr Dignan and Mr Halikos, had decided that they would only go ahead with the development of H105 if they received some binding pre-commitment from INPEX, or even if they did have such an intention, they did not communicate this to INPEX;[7] and
(ii) in any event, her Honour did not accept that INPEX had made the pleaded misrepresentation.[8]
GROUNDS OF APPEAL
The Supplementary Notice of Appeal pleads the grounds of appeal as follows:
Ground 1. By reason of the 21 month delay between the conclusion of the evidence and the giving of reasons for judgment, the 18 month delay between closing submissions and the giving of reasons for judgment, and the more than 5 month delay between the pronouncement of judgment and the giving of reasons for judgment, the judgment is unsafe.
Ground 2. Having committed herself to judgment without mature reasons, the trial judge erred by binding herself to prepare reasons that supported that judgment, irrespective of any further consideration of the evidence and issues.
Ground 3. By reason of the delay between the conclusion of evidence and the giving of reasons for judgment, the trial judge was required, but failed, to provide a comprehensive consideration of the evidence, including the oral evidence, in her reasons.
Ground 4. In resolving a contest on the evidence as to the meaning and purpose of documents or communications, or the circumstances of the occurrence of an event, the trial judge erred in resolving the conflict by failing to have any, or any sufficient, regard to significant aspects of the evidence of the plaintiffs’ (appellants’) (together Halikos) witnesses called in explanation of documents or circumstances involved in the event, concessions in the evidence of the defendant’s (respondent’s) (INPEX) witnesses called and/or other documents.
Particulars
The relevant findings made without any, or any sufficient, regard to evidence are substantial and the appellants have particularised them, together with the evidence not adverted to by the trial judge, in Schedule A hereto.
Ground 5. The trial judge erred in failing to have any, or any sufficient, regard to the evidence of the Halikos witnesses and of Mr Wheeldon (of INPEX) that from at least the meeting on 29 January 2014, two separate agreements (one specific to rooms in H105, and the other being a broader accommodation services agreement), each with their own separate timelines and processes, were discussed.
Ground 6. The trial judge erred in finding at Reasons for Judgment (R) [246], [255], [265], [270], [274] that Halikos failed to establish the factual basis of its claims.
Ground 7. The trial judge erred in finding at R [243] that the High Court has not more recently applied a wider basis for the conferral of authority for a corporation to enter into a contract than the earlier cases.
Ground 8. The trial judge erred in finding at R [246] to [252] that there was no authority in Mr Wheeldon and/or Mr Kildare and/or Mr Wheeldon’s proxy (Mr Davies) to commit INPEX to a binding agreement or understanding.
Ground 9. The trial judge erred in finding at R [264] to [257] that there was no intention by those participating in the events of 13 February 2014 to enter into binding legal relations as a result of what occurred on that date.
Ground 10. The trial judge erred in holding at R [264] that the principles applicable to estoppel by convention are those set out in Waltons Stores (Interstate) Ltd V Maher [1998] HCA 7; (1988) 164 CLR 387, [34] per Brennan J.
Ground 11. In respect of the claim in conventional estoppel, the trial judge erred in finding at R [265] that the parties did not adopt a mutual assumption that they had entered into a binding agreement.
Ground 12. In respect of the claim in estoppel by representation, the trial judge erred in finding at R [270] that Halikos did not establish that the representation it relies on was ever made.
Ground 13. In respect of the claim for misleading or deceptive conduct, the trial judge erred in finding at R [274] that INPEX did not make the representations relied upon by Halikos.
Schedule A is attached to these reasons.
For convenience Halikos has referred to grounds 1 to 3 as the Reasons Grounds, grounds 4, 5, 6, 9, 11, 12 and 13 as “Evidence Grounds”, grounds 7 and 8 under the heading “Authority” and ground 10 under the heading “Estoppel by convention”.
As the trial judge pointed out in her Reasons there were several “key events in this case”: the first being the 17 January 2014 meeting; the second being the 13 February 2014 meeting after which the 13 February 2014 letter was signed by Mr Davies purportedly on behalf of INPEX. Most of the evidence, and consequently the trial judge’s main focus and findings about Halikos’ claims, involved the affidavit and oral testimony of the various witnesses who were participants in the numerous discussions and communications before, during and after the meeting on 13 February 2014. Much of the oral evidence was conflicting and her Honour carefully assessed the evidence of each of the witnesses in determining what she accepted and what she did not. As we have stated above, by and large her Honour preferred the evidence of the main INPEX witnesses, Messrs Kildare and Wheeldon, to that of the main Halikos witnesses, Messrs Dignan and Weeks.
For the most part the Evidence Grounds contend that her Honour erred in her assessment of the oral evidence. Senior counsel for Halikos said that in broad terms the Evidence Grounds were based upon alleged failures by the trial judge to take certain evidence into account or in rejecting “important” evidence on a flawed basis. Of particular importance to Halikos were her Honour’s allegedly erroneous:
(a)“foundational finding” at [63] of the Reasons where her Honour accepted the INPEX version of what happened during the meeting in Perth on 17 January 2014; and
(b)over reliance on documents and her failure to place and construe them in their proper context in light of things said and other circumstances leading up to the making of such documents.
GROUNDS 1 – 3
It is convenient to deal with the Reasons Grounds, grounds 1 to 3, first.
The hearing in the Supreme Court took most of May 2017 and was followed by detailed and voluminous oral and written submissions, the last of which was a 297 page electronic summary of the evidence with hyperlinks to witness affidavits, expert reports and transcripts (entitled Communications Summary) provided by the parties on 26 September 2017. The trial judge pronounced judgment in favour of INPEX on 31 August 2018 and delivered Reasons on 13 February 2019.
When the trial judge pronounced judgment in favour of INPEX her Honour stated that: (i) the Reasons would be delivered at a later date; (ii) she was unable to finalise her [written] Reasons due to the state of her court list and would be unable to do so before December 2018; and (iii) “in fairness to the parties [her Honour believed] the appropriate course of action would be to pronounce judgment [on 31 August 2018] with reasons to be delivered at a later date.”
When her Honour delivered the Reasons on 13 February 2019 she ensured that all rights of appeal were preserved notwithstanding the delay in the delivery of those reasons.
Halikos submitted that, by reason of the 21 month delay between the conclusion of the evidence and the giving of the Reasons, the judgment is unsafe. They further submitted that her Honour, having committed herself to judgment “without mature reasons”, erred by binding herself to prepare reasons that supported the judgment which her Honour pronounced, irrespective of any further consideration of the evidence and issues. Further, Halikos said that by reason of the delay the trial judge was required, but failed, to provide a comprehensive consideration of the evidence, including the oral evidence, in her reasons.
While Halikos referred to a period of 21 months between the completion of the evidence and the date the Reasons were delivered, another measure of the delay is between the delivery of the Communications Summary on 26 September 2017 and the delivery of reasons on 13 February 2019 – a period of some 17 months.
In a case such as this there will inevitably be delay between the completion of evidence and submissions and the delivery of reasons for decision. This was a factually complex civil trial proceeding over a number of weeks and involving the consideration of voluminous documentary evidence. Lengthy and detailed written submissions were provided by the parties and these were supplemented by oral submissions and then the provision of the Communications Summary. Her Honour took time to consider these materials before pronouncing judgment. At the time of pronouncing judgment her Honour made it clear that there would be some delay in delivering the Reasons because of the pressures of other matters before the Court.
Relevant principles
The requirement for a court to deliver adequate reasons for decision is not in dispute. There is an obligation upon the court to explain the determination and conclusions made. The desirability of doing so at the earliest reasonable time is obvious. Halikos however submitted that there was “a requirement that a court deliver reasons in support of a judgment before, at, or virtually immediately after, the time when judgment is pronounced” and, in support of this contention, relied upon the judgment of the Court of Appeal in New South Wales in Palmer v Clarke.[9] That case related to a decision of the New South Wales District Court which, as the judgment recorded, is a statutory court of inferior status. The relevant Act and Rules were found to have imposed an obligation of immediacy.
Palmer v Clarke was considered in Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd[10] (Fletcher), where it was pointed out that the decision was “confined” to decisions of the District Court and noted this had been recognised in subsequent cases in New South Wales. In Fletcher Chernov AJ said the following about superior courts, at [28]:
(A)lthough ordinarily reasons are given when judgment is pronounced, where the justice of the situation requires it there may be an appreciable gap between the pronouncement of judgment and the delivery of reasons.
In Nais and Others v Minister for Immigration and Multicultural and Indigenous Affairs and Another[11] Gleeson CJ observed:
Undue delay in decision-making, whether by courts or administrative bodies, is always to be deplored. However, that comfortable generalisation does little to advance the task of legal analysis when it becomes necessary to examine the consequences of delay. The circumstances in which delay, of itself, will vitiate proceedings, or a decision, are rare…. A court of appeal, reviewing a decision of a primary judge, may conclude that delay in giving judgment has contributed to error, or made a decision unsafe. Again, the ground of appellate intervention is the error, or the infirmity of the decision, not the delay itself.
The following observations, principally extracted from Expectation Pty Ltd v PRD Realty Pty Ltd,[12] are relevant to a consideration of the delay in this matter:
(a)where the interests of justice require it, a court may properly pronounce judgment and give reasons for it later – the gap may be appreciable;[13]
(b)delay between the taking of evidence and the making of a decision is not, of itself, a ground of appeal, unless the judge could no longer produce a proper judgment or the parties are unable to obtain from the decision the benefit which they should;[14]
(c)delay, of itself, does not indicate that a trial has miscarried or that a verdict is in any manner unsafe – appellate intervention flows from the error, or infirmity of the decision, not the delay itself;[15]
(d)where there is significant delay in giving judgment, it is incumbent upon an appellate court to look with special care at any finding of fact challenged on appeal;[16]
(e)the fact of long delay weakens a trial judge’s advantage in having seen the oral and documentary evidence unfold in a coherent manner;[17]
(f)after a significant delay a more comprehensive statement of the relevant evidence than would normally be required should be provided by the trial judge in order to make manifest, to the parties and the public, that the delay has not affected the decision;[18]
(g)where there is significant delay it cannot be favourably assumed that evidence not referred to has not been overlooked and it is incumbent upon the trial judge to make clear why the evidence of a particular witness has been rejected;[19] and
(h)on an appeal consideration must be given to the prospect that the delay of the decision will have placed the trial judge under great pressure to complete and publish the judgment.[20]
Appellate courts do not assume that reasons given after undue delay are infected by error simply because of that delay. It was for Halikos to point to aspects of the reasons that are unsatisfactory or suggest error.[21]
Halikos’ concerns
In ground 1 of the appeal Halikos asserted that the judgment was unsafe as a consequence of the delay between the conclusion of the evidence and the giving of the Reasons. That, by itself, is not sufficient to provide a ground of appeal.
Halikos asserted that her Honour, having committed herself to judgment without mature reasons, erred by binding herself to prepare reasons that supported the judgment. A review of the history of this matter does not support such a contention. This was not a situation where a trial judge announced an outcome at the time of completion of the evidence and then delayed in providing reasons. In this case the trial judge heard all of the evidence and then received written submissions from the parties and heard their oral submissions. Thereafter her Honour received the Communications Summary and adjourned the hearing. Prior to pronouncing judgment in favour of INPEX her Honour had ample time to review all of the materials and to reach considered conclusions. There is nothing in the information drawn to the attention of this Court to suggest that her Honour had any difficulty in dealing with the issues or that there had been a rush to judgment followed by the crafting of reasons to support that judgment. Indeed, the opposite would seem to be the case. At the time of pronouncing judgment her Honour indicated that she had been unable to finalise her [written] Reasons, not that she had insufficient time to consider all the materials.
In both written and oral submissions Halikos contended that the Reasons provided by the trial judge “pay no relevant regard to the oral evidence” and failed to consider “critical aspects of the documentary evidence”. It was submitted that most of the lay evidence was not referred to in the Reasons in any substantive way and was “referred to in only three places in the reasons and then in passing”. We have addressed those issues elsewhere in these reasons for decision and, for present purposes, it is sufficient to note that we do not accept this submission. The trial judge referred to and dealt with the necessary oral evidence in the context of the relevant documentary evidence and also addressed, separately, the documentary evidence. The Reasons provide a sufficiently detailed consideration of the evidence to clearly understand how the trial judge reached relevant decisions and conclusions. The reasons for her Honour preferring one witness over another or for not accepting the evidence of an individual witness were spelled-out clearly in the Reasons.
In the circumstances of this matter, it can fairly be observed that the advantage available to the trial judge over this Court of having seen the oral and documentary evidence unfold in a coherent manner, has been weakened. The careful review conducted by this Court of that oral and documentary evidence has led us to the same conclusions as drawn by her Honour. In so doing we have heeded the advice from the relevant authorities to provide careful scrutiny to the challenged findings and to look with special care at the findings of fact made in the court below.
Further, the Reasons do not support the suggestion made by Halikos that her Honour “felt unable to grapple adequately with the issues and has resorted to the decision which has been easiest to make” as contended in Halikos’ written submissions. Halikos failed to identify any basis for such a suggestion other than the length of time it took for the Reasons to be delivered. While the issues in this case were complex and the evidence long and convoluted, the Reasons deal appropriately with all of the relevant issues and reach conclusions strongly supported by the evidence.
Halikos did not develop an argument that the trial judge was, in any relevant way, subjected to unusual pressure to complete and publish her Reasons. Her Honour had pronounced the outcome of the proceedings and all that remained was the handing down of reasons. We do not accept that there was any adverse impact upon the Reasons resulting from the delay or any undue pressure upon her Honour to deliver judgment.
These grounds of appeal are dismissed.
EVIDENCE GROUNDS – general considerations
Grounds 4, 5, 6, 9, 11, 12 and 13 and the particulars pleaded in Schedule A involve, to varying degrees, challenges to over 100 findings made by the trial judge. In the circumstances, and for the reasons given at [55] to [67], it is convenient to deal with ground 4 last. The resolution of the substance of ground 5 (Halikos’ contention that there were two variation agreements being considered by the parties), and the resolution of grounds 7 and 8 (Authority), ground 9 (intention to enter a legally binding relationship) and ground 10 (Estoppel) largely resolves this appeal.
However, before dealing with grounds 5, 7, 8, 9 and 10 we shall refer to some fundamental flaws in Halikos’ approach to the Evidence Grounds, guiding principles about consideration of evidence in cases such as this, the principles applicable when reviewing alleged errors of fact and INPEX’s submissions about four critical issues, and make some additional observations about Schedule A.
Fundamental flaws
In their written submissions Halikos did little more than repeat the text of Schedule A and add transcript references. On the other hand, counsel for INPEX attached to their written submissions a 131 page schedule (INPEX Schedule) which provided comprehensive and detailed responses to each of Halikos’ allegations and transcript references in support of those responses. Unfortunately, Halikos did not engage with those detailed responses in their written reply submissions. They only embarked upon that exercise in the course of their oral submissions, and even then only regarding some topics. Our perusal of the material, particularly with the assistance of the INPEX Schedule, indicates that INPEX’ contentions are well founded.
Halikos did not demonstrate that the evidence her Honour allegedly disregarded did in fact call into question the integrity of the challenged findings of fact and, if so, how. We consider that the trial judge’s approach to the process of fact-finding and her conclusions on key factual issues were correct. This conclusion renders a detailed consideration of each particular in Schedule A unnecessary.
Ground 4 is couched in terms of the trial judge having failed to pay any or sufficient regard to ‘significant aspects’ of certain parts of the evidence. That allegation is necessarily based on the contents of the Reasons, in particular, the extent to which specific evidence was not referred to or dealt with in the Reasons. This ground effectively involved two distinct aspects.
First, in substance, was a complaint about the adequacy of the Reasons. This is, in effect, a duplication of ground 3, which we have found has not been made out.
Second, was an assertion that the process of fact finding has miscarried.[22] However, it is not enough for an appellant to show that a trial judge has failed to deal with some evidence. That will not establish that the trial judge has failed to deal in a satisfactory way with the substantial amount of evidence necessary to be dealt with before a relevant finding could be made. To establish that, the evidence which an appellant alleges a primary judge failed to deal with must have a particular quality; it must not only be relevant, but the failure must seriously call into question the integrity of a finding of fact. [23]
Guiding principles
In our opinion, the following are the guiding principles to be applied to the consideration of the evidence in a case such as this.
At first instance, a court should generally limit its reliance on the appearance of witnesses and should reason to its conclusions, as far as possible, on the basis of contemporaneous materials, objectively established facts and the apparent logic of events.[24]
The resolution of an issue involving the credibility of witnesses or disputed oral evidence will require reference to, and analysis of, any evidence independent of the parties which is apt to cast light on the probabilities of the situation.[25] As Black J observed in Re Kit Digital:[26]
…the credibility of a witness and his or her veracity may be tested by reference to the objective facts proved independently of the testimony given, in particular by reference to the documents in the case…
Where a party seeks to rely upon spoken words as a foundation for a cause of action, the conversation must be proved to the reasonable satisfaction of the court, which means that the court must feel an actual persuasion of its occurrence or its existence.[27] In John Holland Pty Ltd, in a passage recently cited,[28] Hammerschlag J observed that:
Where a party seeks to rely upon spoken words as a foundation for a cause of action, including a cause of action based on a contract, the conversation must be proved to the reasonable satisfaction of the court which means that the court must feel an actual persuasion of its occurrence or its existence. Moreover, in the case of contract, the court must be persuaded that any consensus reached was capable of forming a binding contract and was intended by the parties to be legally binding. In the absence of some reliable contemporaneous record or other satisfactory corroboration, a party may face serious difficulties of proof. Such reasonable satisfaction is not a state of mind that is obtained or established independently of the nature and consequences of the fact or facts to be proved. The seriousness of an allegation made, inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question of whether the issue has been proved to the reasonable satisfaction of the court. Reasonable satisfaction should not be produced by inexact proofs, indefinite testimony, or indirect inferences …
The sensation of feeling an actual persuasion, after a contest, that an event has happened or that something exists is one which is well known and recognised by experienced trial judges for what it is.
[The plaintiff] has the onus of establishing the agreement for which it contends. This entails proving to the reasonable satisfaction of the court that the words said to give rise to the agreement were actually said, and that the alleged consensus was capable of forming a binding agreement and was intended by the parties to be legally binding.” [citations omitted]
In the context of misleading or deceptive conduct claims, where a plaintiff relies on oral statements, particularly where the oral evidence is disputed, they face “serious difficulties of proof” in the absence of some reliable contemporaneous record or other satisfactory corroboration.[29] It is also necessary for the words to be proved with a degree of precision sufficient to enable the court to be reasonably satisfied that they were misleading in the proved circumstances.[30]
These principles apply equally to contractual and estoppel claims.[31]
Reviewing alleged errors of fact
An appellate court is to conduct a real review of the trial and the reasons for decision to determine whether a trial judge erred in fact (or law).[32]
However, the appellate court must, of necessity, observe the natural limitations that exist in proceeding wholly or substantially on the record.[33] That includes limitations occasioned by the resolution of any conflicts at trial about witness credibility based on demeanour or impression; any advantages the trial judge had that derive from considerations not adequately reflected in the transcript; and matters arising from the trial judge’s advantage in having the opportunity to consider and reflect upon the entirety of the evidence as it was received, and to draw conclusions from that evidence viewed as a whole.[34] The more prominent these limitations, the more difficult it is for an appellate court to be satisfied that the trial judge was in error.[35]
Until recently it had been held that an appellate court should not interfere with a trial judge’s findings of primary fact unless those findings are demonstrated to be wrong by ‘incontrovertible facts or uncontested testimony’, or are ‘glaringly improbable’ or ‘contrary to compelling inferences’.[36] For example in Robinson Helicopter the High Court (French CJ, Bell, Keane, Nettle & Gordon JJ) said, at [43]:
… a court of appeal should not interfere with a judge’s findings of fact unless they are demonstrated to be wrong by “incontrovertible facts or uncontested testimony”, or they are “glaringly improbable” or “contrary to compelling inferences”.
However the application of a ‘glaringly improbable’ or ‘contrary to compelling inferences’ test has recently been qualified by the majority of the High Court in Lee v Lee[37].
In Lee v Lee, Bell, Gageler, Nettle & Edelman JJ, Kiefel CJ agreeing said, at [55]:
A court of appeal is bound to conduct a "real review" of the evidence given at first instance and of the judge's reasons for judgment to determine whether the trial judge has erred in fact or law[38]. Appellate restraint with respect to interference with a trial judge's findings unless they are "glaringly improbable" or "contrary to compelling inferences"[39] is as to factual findings which are likely to have been affected by impressions about the credibility and reliability of witnesses formed by the trial judge as a result of seeing and hearing them give their evidence. It includes findings of secondary facts which are based on a combination of these impressions and other inferences from primary facts[40]. Thereafter, "in general 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".[41]
Referring to the disadvantage of an appellate court when reviewing a trial judge’s assessment of a witness’ credibility Bathurst CJ observed, in Szeto v Situ[42]:
That disadvantage particularly arises in a case such as the present where the judge based his conclusion, to a significant extent, on the credibility of the principal witnesses. However, if a conclusion based on credit is shown by uncontroversial facts or uncontested testimony to be erroneous, the appellate court is obliged to intervene: Fox v Percy … at [28]. One instance where this may occur is where contemporaneous and apparently reliable documentary evidence is contrary to the credibility based finding of the trial judge: State Rail Authority of NSW v Earthline Constructions Pty Ltd (In liq) (1999) 73 ALJR 306 at [62] – [63], [93].
That said, these limitations may have less impact on the determination of an appeal from a judgment concluded wholly or substantially by reference to documentary and affidavit evidence. In such a case, an appellate court may be in as good a position to determine the matter as was the primary judge.[43] Additionally, an appellate court is generally in as good a position as the trial judge to decide on the proper inferences to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the primary judge.[44]
Four key issues
In its written submissions INPEX advanced four main reasons why, quite apart from descending to the detail involved in Schedule A and the INPEX Schedule, ground 4 should be dismissed. These reasons were said to be fatal to Halikos’ claims. For these reasons it was submitted that further consideration of the challenges by Halikos to other factual findings, even if successful, would not alter the outcome of the appeal.
In our opinion those submissions are correct.
First, INPEX submitted that when the Reasons are considered as a whole, it is apparent the trial judge correctly approached the fact-finding process. Her Honour generally based her reasoning on a consideration of contemporaneous materials, objectively established facts and the apparent logic of events. Although her Honour referred to important parts of the oral evidence in the Reasons, her Honour was rightly disinclined to resolve disputed facts by reference exclusively to oral testimony.
The second reason identified by INPEX was the finding made by the trial judge that the parties did not, at any relevant time, discuss the making of two separate agreements. Her Honour found that it was not until July 2014 that Halikos raised two agreements for the first time. The finding is the subject of challenge in ground 5 of the appeal and we deal with it below. For present purposes it is sufficient to note that the existence of two agreements was a necessary prerequisite to explain the otherwise implausible evidence of Mr Dignan and Mr Weeks that they had concluded the Additional Accommodation Variation agreement on 13 February 2014. Her Honour’s rejection of the contention that there were two agreements led to the necessary rejection of that evidence. It placed the documentary evidence in a different context from that urged by Halikos. We accept and adopt the following submission made on behalf of INPEX:
The plain evidence that Halikos did not at any time believe that there were two agreements, one of which had been concluded and one of which had not, stands comprehensively against a finding that the Additional Accommodation Variation was concluded in February 2014 or that Halikos acted subsequently on the basis that it had been. That is fatal to all of Halikos’ claims at first instance.
The third reason related to ground 8 and is dealt with below. In short, it is that neither Mr Wheeldon (nor his proxy Mr Davies) nor Mr Kildare had actual or ostensible authority to enter into the Additional Accommodation Variation and the finding of the trial judge in that regard was plainly correct. That being so, it was submitted that Halikos’ contractual claim necessarily failed.
Counsel for INPEX identified the fourth reason as follows:
94. Fourth, the trial judge in the context of her consideration of the consumer law claim did not accept that Mr Dignan and Mr Halikos had, subjectively, decided that they would only go ahead with the development of H105 if they got some kind of binding pre-commitment from INPEX. In substance, that amounted to a finding that there was no relevant reliance upon any alleged representation. Halikos does not mount a separate ground of appeal in relation to that conclusion, although it does contend that the finding was made without sufficient regard to certain evidence.
95. As to the evidence to which Halikos says the trial judge should have had more regard:
(a) the evidence as to Sakamoto san’s internal communications with Mr Wheeldon do not bear upon the state of mind of Mr Halikos and Mr Dignan, save to the limited extent that they evidence that a commitment was sought;
(b) the internal email dated 26 February 2014 from Okawa san to his assistant does not contain any relevant evidence on this issue. Further, it is plain from Reasons [55] and fn 3 that her Honour had proper regard to that document; and
(c) the asserted inference that it made no commercial sense for Halikos to build H105 without a pre-commitment was self-evidently an insufficient basis upon which to find on the balance of probabilities that Halikos relied upon a representation or assumption that INPEX had entered into the alleged agreement or would bind itself to the Additional Accommodation Variation.
96. Further, Halikos does not challenge the trial judge’s finding at Reasons [153] that ‘Halikos went ahead with the construction of H105 in the expectation … that there would be plenty of demand for accommodation of that kind from workers on the Ichthys Project’.
97. There is therefore no merit in the challenge to the trial judge’s findings on reliance. That being the case, the claims under the consumer law and also in estoppel necessarily fail. Again, further consideration by the appellate court of Halikos’ challenges to other factual findings will not affect that position.
The issue of reliance is addressed elsewhere in these reasons. Again, we have found no reason to interfere with the findings of the trial judge on that topic.
Counsel for INPEX made the following two points about the assertions contained in Schedule A.
99. The first is that the INPEX Schedule identifies in column 5 that almost all of the evidence which Halikos asserts the trial judge did not have sufficient regard to was included in the Communications Schedule and/or referred to in written or oral closing submissions. That renders it unlikely that the trial judge did not have regard or proper regard to such evidence.
100. The second is that there are many flaws in Schedule A and Halikos’ appeal submissions in support. Much of the evidence that Halikos says the trial judge failed to have sufficient regard to falls into one or more of the following categories:
(a) the evidence was in fact expressly referred to in the Reasons and therefore cannot be said to have been given insufficient regard by the trial judge;
(b) the evidence is of no or limited relevance to the specific finding(s) challenged;
(c) Schedule A and/or Halikos’ appeal submissions incorrectly state the effect of the evidence;
(d) the evidence is consistent with the documentary and other evidence on which the trial judge relied;
(e) the evidence is obviously unreliable;
(f) the evidence is referred to only in Halikos’ appeal submissions, and not in the Notice of Appeal (which Halikos has not sought leave to amend).
101. The contents of the INPEX Schedule reveal that Halikos has failed to demonstrate that the trial judge did not have sufficient regard to significant aspects of the evidence or that any such alleged omission on her Honour’s part gave rise to relevant factual error.
Counsel for Halikos did not respond to these submissions in their written reply.
We agree with the first point made by INPEX, namely that it is unlikely that the trial judge did not have regard or proper regard for the evidence included in and / or referred to in written or oral closing submissions. Indeed, it was her Honour who took the approach of requesting the Communications Schedule with the obvious intention of using it in conjunction with the written and oral submissions when considering the evidence and preparing her Reasons.
Further, there is considerable force in the second point, particularly in sub-paragraphs (b) to (e) of [100].
Schedule A
In addition to the four matters discussed above we make some further observations about Schedule A. As we have noted, Schedule A (a copy of which is attached to these reasons) contains 43 paragraphs, each of which identifies factual findings which are challenged. In our opinion many of the challenges, even if made out, are not such as to make any material difference to any important inference or conclusion drawn by the trial judge. We see no reason to address each and every reference contained in Schedule A and the INPEX Schedule. This is particularly so where there has been no challenge by Halikos to the detailed responses found in the INPEX Schedule.
However, later in these reasons we examine in greater detail those challenges which have been identified in the course of submissions as being related to important issues. They include:
(a)whether the parties were discussing two separate agreements by the time the AAV was said to have been made on 13 February – one providing for the provision of 225 apartments for the next five years, then 150 for the following 10 years; the other a broader accommodation services provider agreement;
(b)whether there was ostensible authority for Mr Wheeldon to agree to the AAV following the meeting in Perth on 17 January 2014;
(c)whether a binding agreement was reached during the meeting on 13 February 2014, and/or after Mr Davies signed the letter bearing that date;
(d)whether Halikos required, and informed INPEX that it required, a binding or written commitment before commencing work on H105. [In oral submissions counsel referred to and relied heavily upon some kind of commitment, in some cases referring to a binding commitment, in others a written commitment. It remains unclear as to precisely what kind of commitment is alleged and a commitment to do what. In paragraph [17](a)(iii) of its Reply Halikos alleged that “on numerous occasions Mr Dignan said to Mr Wheeldon and other representatives of INPEX words to the effect that Halikos would not build a new building without a pre-commitment.”];
(e)the content, meaning and effect of discussions on about 24 March 2014 and the draft press releases;
(f)Mr Wheeldon’s email of 21 July 2014;
(g)the credibility of important witnesses, Messrs Weeks and Dignan on the one hand, and Messrs Wheeldon, Kildare and Okawa san on the other.
GROUND 5 – Two Agreements
Between the end of 2013 and October 2014 the parties engaged in various negotiations about a variation to the Accommodation Agreement with consideration being given to Halikos becoming the primary accommodation services provider for the project and supplying significantly more accommodation. As we have mentioned, it was critical to Halikos’ case on appeal that two variations were negotiated, one of which resulted in a completed agreement on 13 February 2014. According to that alleged contract INPEX was to take from Halikos not less than 225 (later reducing to not less than 150) apartments and hotel rooms for a 15-year period. The other variation being negotiated according to Halikos was a broader arrangement under which Halikos was to become the primary accommodation services provider for the Project and would provide additional accommodation plus a range of allied services such as airport transfers and catering. Halikos accepts that no such broader agreement was ever completed.
Contrary to the case made by Halikos at trial, at R [175] the trial judge found:
For the reasons which follow, I do not accept the evidence of Mr Dignan and Mr Weeks that there was ever any discussion about anything other than a single accommodation services provider agreement before 9 July 2014 when the possibility of two separate agreements was first raised by Mr Dignan.
The trial judge had previously discussed evidence about other events and communications subsequent to 13 February 2014 including draft media releases, the meetings with the Chief Minister on 24 March, the “Darwin Accommodation Proposal” prepared and provided by Halikos soon after that, and other meetings and communications between April and July.
Her Honour proceeded to discuss emails and other communications between the four main participants concerning the preparation of a decision note and associated delays, and the evidence of Messrs Dignan and Weeks about meetings and discussions on 26 May and 20 June and about there being two proposed agreements.[45]
Her Honour discussed the “two agreements” issue in more detail from R [186]. Her Honour quoted from an email which Mr Dignan sent to Mr Wheeldon on 9 July suggesting that “we break down the [Accommodation] Agreement in two separate variations”. Her Honour said: “This is the first time that the concept of two different agreements occurs in the documents.” Halikos has not challenged this finding.
After discussing subsequent communications including Mr Dignan’s email of 11 July, her Honour referred to some exchanges of text messages between Mr Dignan and Mr Wheeldon on 18 July when Mr Dignan said:
Chris the 225 deal has been agreed as per the Feb 13 letter, am I to understand your text is referring to the Service Provider’s Agreement 800575/3?[46]
Her Honour said, at R [193]:
This is the first mention in any of the documents of there having been an agreement arising out of the letter of 13 February, referred to by the Halikos parties in earlier documents as a “letter of intent”.
If the finding at [69] above is correct, it is fatal to Halikos’ claims.
In its written submissions about ground 5 Halikos contended:
[152] In making many of the findings set out in the Reasons, the trial judge appears to have viewed the contemporaneous correspondence on the basis that a single agreement covering the broader accommodation services provider arrangement only was being discussed (see for example, R [67], [73], [75]-[76], [162], [170](f), [186] and [247]).
[153] In so doing, the trial judge failed to have any proper regard to the evidence of the Halikos witnesses and of Mr Wheeldon that from at least the time of the 29 January meeting, two separate agreements (one specific to rooms in H105, and the other being a broader accommodation services provider agreement), each with their own separate timelines and processes, were discussed (see, in particular, T 1485-1486 (Wheeldon XXN); 1 Dignan [277]-[279], [286]; 1 Weeks [190]-[191]; T 346-347 (Dignan XXN); T 737-739 (Weeks XXN) …
[154] Had the trial judge had proper regard to the evidence referred to above, the trial judge ought to have found that, from at least 29 January 2014, the parties were discussing two separate agreements or concepts, something common to them, although not always specifically drawn out in their written communications, at least not prior to July 2014, when the two concepts or agreements came to be explicitly the subject of separate treatment.
[155] That was an important, indeed necessary, finding of fact to be made on the critical path of the trial judge’s reasoning as the trial judge frequently relied upon and confused the continued negotiation evident in the parties’ written communications of the broader accommodation services provider agreement as evidence that they were still negotiating the agreement for specific rooms (to be provided in H105).
Many of the findings challenged in Schedule A under ground 4 also relate to the point made at [153] in Halikos’ written submissions. These include several of those set out in paragraphs 7 (regarding a meeting on 29 January), 8 to 11 (regarding events between 28 January and 13 February), 22 to 30 (regarding events between late March and 21 July), 31 (re Mr Wheeldon’s email of 21 July) and 32 to 43 (regarding subsequent events).
Senior counsel for Halikos was also critical of the trial judge for not having sufficiently analysed the evidence about the meeting on 29 January 2014 when, according to Halikos, the parties began discussing the two separate agreements, one being the AAV which was completed on 13 February 2014, the other being a “broader accommodation services provider agreement” which was never completed. In short Halikos contended that, although there were ongoing discussions and negotiations including discussions about a decision note, those discussions related to something different to the AAV.
Despite the pleading of ground 5 – “the trial judge erred in failing to have … regard to the evidence …” – it is clear that Halikos is challenging the trial judge’s conclusion that at all material times, particularly on the 13th February 2014, and subsequently at least until early July, the parties were only discussing a single broad accommodation services provider agreement, not two separate agreements.[47]
In their written submissions, counsel for INPEX noted that the two agreements issue was not pleaded. Halikos pleaded a single agreement, the AAV, the terms of which were included in the Variation Document defined in paragraph [16] of the ASOC. However, the only two parts of the Variation Document which are not said to be part of the AAV are Recitals A and C. At R [230] the trial judge noted that no explanation for this was provided by Halikos, and concluded that it was a necessary part of Halikos’ case that it was negotiating with INPEX about two separate agreements.
INPEX contended that the trial judge proceeded properly by determining the facts, as far as possible, on the basis of contemporaneous materials, objectively established facts and the apparent logic of events. Her Honour’s considerations and conclusions included the affidavit and oral evidence.
Counsel for INPEX pointed out that Halikos argued at trial that there were two distinct ‘aspects’ to the negotiations between the parties capable of separate agreement. The first was a potential agreement with respect to the supply of additional accommodation. The minimum obligation in that regard was to provide (in the case of Halikos) and to take or pay (in the case of INPEX) not less than 225/150 apartments and hotel rooms from a range of properties. We note that this is different to the contention made in [153] of Halikos’ written submissions, quoted above, that the first agreement was “specific to rooms in H105”. The second aspect was for Halikos to provide, and for INPEX to pay for, a range of allied accommodation services such as airport transfers, catering and the preparation of statistical data as to accommodation usage and demand, and possibly additional accommodation.
Senior counsel for Halikos took the Court to some of Mr Wheeldon’s evidence at trial about the meeting of 29 January 2014 which he said contained an important concession which the trial judge failed to address. He later took the Court to the Reasons between [164] and [171] concerning communications about a decision note, tenders and INPEX’s internal processes. In particular counsel referred the Court to:
(a)Parts of the “proposal” referred to by her Honour at R [166] – [171], where her Honour discusses some of the evidence about communications concerning the preparation of a decision note. The “proposal” was a 69 page document prepared by Halikos headed “INPEX” “Accommodation Services Provider Agreement” and was dated April 2014. On the front page it was referred to as the “Halikos Hospitality Pty Ltd Darwin Accommodation Proposal” (Halikos Accommodation Proposal). The document was given to Mr Wheeldon in late March or early April. It was referred to in some of the documentation as an “Inpex Presentation Portfolio April FINAL”.
(b)An “Onshore Decision Note” prepared by Mr Wheeldon (the Onshore Decision Note). He sent that document to Mr Baldwin, INPEX Site Contracts Engineer, on 12 June 2014, together with other documents including an “Accommodation Services Provider Agreement Final”, an “Inpex Presentation Portfolio April FINAL – reduced”, a PowerPoint presentation also entitled “Inpex Presentation Portfolio April FINAL” and a document entitled “Project Forecast Manpower – Presentation – 2014-05-30”.
(c)Communications from 9 July 2014 including an email from Mr Dignan to Mr Wheeldon on 11 July 2014 when he stated that he was “separating the variation of Contract 800575 into two parts” and sent him “Variation document 800575-2”.
(d)An email from Mr Wheeldon to Mr Dignan on 21 July in which he said, amongst other things: “The original signed letter should suffice for the first agreement until such time all agreements can be again rolled up into one tidy provision which I believe will be more easily executable.”
Halikos contended that these documents and discussions, and in particular the requirement for a decision note, only related to what counsel referred to as the “broader accommodation services provider agreement” and not to the AAV which was concluded on 13 February 2014. Halikos also relied heavily upon what counsel contended was an acknowledgement by Mr Wheeldon during the meeting on 29 January 2014 that the parties would be proceeding with two separate agreements.
Halikos was also critical of the trial judge’s general acceptance of the evidence of Mr Kildare over that of Messrs Dignan and Wheeldon, and her Honour’s response to Mr Wheeldon’s assertion in his email of 21 July 2014 that “[t]he original signed letter should suffice for the first agreement …”. Counsel said that this response should have caused the trial judge to reconsider her views about the credibility of witnesses and in particular about the two agreement issue.
29 January 2014 meeting
On 29 January 2014 Messrs Dignan and Weeks met with Messrs Kildare and Wheeldon in INPEX’s office in Darwin. Senior counsel for Halikos was critical of the trial judge’s failure to expressly deal in any detail with Halikos’ contentions at trial and in particular with what counsel contended was a concession by Mr Wheeldon during cross-examination that there were discussions at that meeting about moving towards two agreements, not just a single agreement. This concession is said to have been recorded in the trial transcript.
The part of the transcript of Mr Wheeldon’s cross-examination said to contain this “important” concession was as follows:
Q At this point, the parties were, I suggest discussing, without necessarily distinguishing, two separate concepts or elements of a relationship. One, a specific arrangement for the provision of specific accommodation, and the other, a more general arrangement involving more general service provision.
A The priority for us was the more … the latter, which is the service provision.
Q Will you attend to my question, though: the parties were discussing both elements, weren’t they?
A Both elements, yes.
Q And you agree they are quite separate and distinct concepts, don’t you, that is, provision for accommodation of a certain number of apartments in a particular building or buildings on the one hand, and a general service provision arrangement on the other?
A We saw it as one.
Q Right. They were discussed as part and parcel of the same scheme originally, weren’t they?
A Yes. Yes.
Q But you agree that, conceptually, they are quite different things?
A Conceptually, they are, yes.
Counsel for INPEX took the Court to some of the re-examination of Mr Wheeldon including the following:
Q When do you recall first mentioning a decision note to either Mr Weeks or Mr Dignan in relation to the proposal under discussion from early January 2014?
A For the accommodation service provision, that would have to be part of a decision note, yes.
Q Alright. When you say “accommodation service provision”, what are you referring to there?
A Everything.
Q So when you say “everything”, can you please be explicit to her Honour about the content, as you understood it, of the accommodation services provider agreement?
A That would include Halikos providing, at our request, whether it was INPEX or JKC, numbers, rooms, allocated to our manning schedules. Whether it was in C2 or One30 or 105, the Frontier Hotel, anything that Halikos could find as an inventory, that included the whole lot, it encompassed everything. It wasn’t specific for certain buildings. It was everything. And that’s what we were looking for from the service provision.
Q What about in terms of amounts of accommodation? What did the accommodation services provider agreement provide in terms of quantity of accommodation?
A We still didn’t know. That … Could never be generated until we got the manning curves from JKC.
…
Q But where did the 225 fit in relation to all this?
A 225 was just a base number. That number could have went up or it could have went down.
Q Right.
A It was only something to start calculating the decision note financials from.
We agree with INPEX’s contention that Mr Wheeldon’s oral evidence was in fact to the opposite effect of that advanced by Halikos — that is, the parties were discussing and negotiating one agreement only. Halikos’ submissions misstated the effect of Mr Wheeldon’s evidence under cross-examination and ignored his evidence in re-examination.
Halikos was also critical of the fact that her Honour did not say much about the oral evidence about that meeting. As we have said, the trial judge did refer to, and express views about, some of the evidence given by Messrs Dignan and Weeks when discussing the two agreements issue.
Counsel for INPEX took this Court to part of the cross-examination of Mr Dignan. At transcript page 338 he repeated his belief that there were two separate agreements being negotiated, one specifically for 105 Mitchell Street “for minimum numbers” and “then to enter into a separate agreement for additional apartments and rooms once those numbers were known”. He said that only the second agreement required a decision note and a recommendation for award (referred to by parties as an RFA). The first one did not. Mr Dignan was then asked if his evidence was that on 29 January 2014 there were two variation agreements being discussed. He answered: “Two parts of one variation agreement.” One of those parts was for Halikos to lease specific apartments in H105 to INPEX, the other a broader accommodation services provider agreement. When asked whether those agreements were to be contained in two separate documents he said: “No … Rolled up into one.” He agreed that the single document would combine both aspects and would not be finalised and executed for a few months. He agreed that there were internal approval processes and he “knew, in relation to the broader accommodation agreement that that was going to require the RFA and the decision note.”
Counsel for INPEX also submitted that Mr Dignan’s email of 9 July 2014 to Mr Wheeldon (in which he proposed for the first time in writing that there be two agreements) stands firmly against the acceptance of the effect of Mr Dignan’s affidavit and oral evidence, as now contended by Halikos.
Counsel for INPEX also took the Court to part of the cross examination of Mr Weeks. He too referred to an accommodation services provider agreement that contained two parts: “Part A was to the accommodation. Part B of it was what … additional services they required [sic]”. The latter would provide for airport transfers, statistical information and other ancillary services. He then gave some confusing evidence about the two parts of the accommodation services provider agreement. Then there was the following exchange:
Q As at 31 January, what is your evidence: did you have two agreements that were going to be finalised at different times, or one?
A The intention was to always try and finalise them as one, but … one was moving faster than the other. I was happy to move the way that INPEX wanted to move.
Q So at 31 January, your intention was to proceed with one agreement that had two aspects?
A If I could, yes.
Q But is your evidence there was the possibility at that time that they would be uncoupled and put into two separate agreements?
A I didn’t know. If Sean Kildare and I could work faster and what his requirements were from INPEX, then fine. If they couldn’t, we would still move forward with what Chris Wheeldon required.
We accept INPEX’s submissions that this evidence does not give rise to an inference that is contrary to the trial judge’s findings, even if her Honour had expressly referred to this evidence in greater detail in her Reasons.
The inference that, from 29 January 2014 the discussions were about a single broad accommodation services provider agreement and not two separate agreements, is also consistent with the discussions from 28 January 2019 and Mr Weeks’s drafts of 7 and 12 February 2014.
After the meeting in Perth on 17 January 2014 (during which Halikos alleges Messrs Wheeldon and Kildare received their authority to enter the AAV), Mr Weeks sent various drafts of what he referred to as a Variation Document to INPEX.
On 18 January, the day after the Perth meeting, Mr Weeks sent a draft variation agreement to INPEX. That draft contained provision for extra accommodation only being provided by Halikos at a property to be constructed by them at 105 Mitchell Street, Darwin (H105). It also differed markedly from the pleaded AAV in several other respects including that it only contemplated the provision of 148 additional rooms (cf 225), was only for an initial term of four years, and only involved INPEX paying for rooms actually “taken” (as distinct from the “take or pay” provisions in the pleaded AAV).
However, after that, the focus of the discussions between the parties changed to a broader-based agreement for the provision of accommodation and services, not confined to H105. Her Honour, at R [71] referred to Mr Weeks’ evidence that when he met with Mr Kildare on 28 January “the majority of the time was spent discussing services that Mr Kildare wanted included in the agreement (for example catering services and airport transfers)”. Following a further meeting on 29 January 2014 between Messrs Weeks, Dignan, Wheeldon and Kildare, Mr Dignan sent an email to Mr Wheeldon and Mr Kildare reflecting them agreeing in principle “to move to an Accommodation Services Provider Agreement” and that the term would be “a minimum of five years but preferred a period of 15 years plus options.”[48]
Mr Kildare replied with his email of 31 January set out at R [75] confirming that he wished to renegotiate and agree on “a more robust longer term and broader accommodation services contract, that meets the long term needs of our construction phase and the oncoming operations phase.” He proceeded to point out that INPEX’s future needs were not clearly defined particularly as INPEX moves beyond its construction phase and into operations.
From that point on the various draft agreements bore the heading Accommodation Services Provider Agreement and differed substantially from the draft provided on 18 January 2014, for example in the respects noted in [96] above.
[100]On 7 February 2014 Mr Weeks sent to Mr Wheeldon a draft Accommodation Services Provider Agreement. It was much the same as the pleaded Variation Document except that:
(a)Recitals B and C referred to the appointment of Halikos as INPEX’s “sole and exclusive accommodation services provider” (cf “primary accommodation services provider in Darwin … in support of the Ichthys Project”).
(b)it provided for a minimum of 250 additional apartments and hotel rooms and that the take or pay obligation on INPEX would apply to that minimum until 1 September 2029 (cf cl 3.5 and 4 of the AAV).
[101]On 12 February 2014 Mr Weeks sent Mr Wheeldon another draft Accommodation Services Provider Agreement. It was similar to the 7 February draft except that:
(a)it reduced the minimum number of rooms to 225;
(b)it altered the take or pay obligation so that from 1 March 2019 to 28 February 2029 it only applied to a minimum of 150 additional Apartments and rooms; and
(c)the main difference between that and the pleaded Variation Document is that Recitals B and C of the latter document referred to Halikos being appointed as INPEX’s primary accommodation services provider.
Halikos said that the 12 February 2014 draft was discussed at the meeting between Messrs Dignan, Weeks and Kildare on 13 February 2014 and that Mr Kildare proposed some minor amendments which were made on a computer screen. On 17 February 2014 Mr Weeks sent a copy of that “final draft” to Messrs Wheeldon and Kildare with an email that stated, amongst other things:
Please find final draft of the Variation which includes the recommended changes from both Chris and Sean. I have left document in Word format just in case.
We will finalise for signing when Chris Wheeldon and myself return from our respective annual leave.
[103]It is that “final draft” of the “Variation Document” which was said to contain the agreement the subject of this litigation, namely what Halikos described as the “Additional Accommodation Variation” (AAV). Recital B to the Additional Accommodation Agreement stated:
INPEX has appointed Halikos as INPEX’s sole and exclusive accommodation service provider to provide accommodation in various properties in Darwin including 105 Mitchell – [...], C2 Esplanade – [...], One130 Esplanade – [...], H Hotel – [...], H20 Apartments – [...], 100 Esplanade – [...], Frontier Hotel – [...], and H Apartments Parap – [...].
[104]The “final draft” also made provision for payment if INPEX required more than the 225 additional apartment and hotel rooms from time to time.
The Halikos Accommodation Proposal
As the trial judge noted there was disagreement between the parties as to whether Mr Wheeldon told Mr Weeks that he was preparing a decision note about the AAV, and as to the reason why Halikos prepared and provided the Halikos Accommodation Proposal.
[106]Under the sub-heading “Communications re “decision note”, tenders and “internal processes” to 9 July 2014, her Honour stated:
[164] Mr Wheeldon deposed that, before April 2014 he told Mr Weeks what he needed to enable him to work up a decision note for the engagement of an accommodation service provider. He said that he needed:
(a) from Halikos, as much information as they could obtain on the available accommodation inventory in Darwin and accommodation being used by JKC and the subcontractors, knowing as he did that personnel from JKC and the subcontractors were staying in accommodation owned or operated by Halikos;
(b) the Northern Territory government’s support for the engagement;
(c) a manning schedule from JKC;
(d) the support of the Operations unit within INPEX; and
(e) an idea of how the accommodation service provider would be engaged.
[165] Mr Weeks deposed that Mr Wheeldon did ask him to find out information about the Darwin accommodation market and the amount of accommodation being occupied by Ichthys Project personnel in Darwin, but that was because INPEX did not have accurate figures about this: Mr Wheeldon did not say he needed this information to prepare a decision note.
[166] I accept Mr Wheeldon’s evidence that he asked for this information to enable him to prepare a decision note, and that he said so to Mr Weeks. That is consistent with a proposal prepared by Halikos and given to Mr Wheeldon in late March or April 2014.
(a) The proposal has a front cover on which is written “INPEX” and “Accommodation Service Provider Agreement” along with pictures of the proposed H105 and Halikos Hospitality’s logo.
(b) The first page inside the front cover is headed “Halikos Hospitality Pty Ltd Darwin Accommodation Proposal” and contains a Table of Contents.
(c) Following brief biographies of Mr Dignan and Mr Weeks, there is a page headed “Executive Summary”. The executive summary provided is as follows:
On the 17th January 2014 INPEX and Halikos Hospitality met at INPEX Perth offices to discuss project accommodation in Darwin, in particular securing additional accommodation that is required for the Ichthys project, and to address concerns in the media that Tourism accommodation had been adversely impacted.
INPEX Operations Australia Pty Ltd and Halikos Hospitality Pty Ltd have an existing Accommodation Contract 800575. In those discussions both parties agreed the best way forward was a variation to the existing contract by negotiating and agreeing a more robust, longer-term and broader Accommodation Services Provider contract, that meets the long term needs of our construction phase commissioning phase and the on-coming operations phase, and is much more suitable to both parties’ needs, and over a 15 year period would be suitable period. The tasks to be undertaken were:
•Chris Wheeldon to determine numbers and timing of ex-village accommodation requirements in the Darwin area. This will include INPEX, EPCs and their sub-contractors (as best as can be determined).
•The current accommodation services contract is held with Chris Wheeldon. Chris will take the lead to negotiate a broader, longer term contract and propose that for execution.
•The process from here is for the INPEX – Halikos relationship to full develop into a long-term one of client (INPEX) and accommodation services provider (Halikos).
The Accommodation Services Provider agreement would be a variation of existing contract 800575 and demonstrate the following actions:-
•INPEX management resources are not taken up with administratively working with accommodation issues, nor do we have to be concerned about availability of suitable accommodation.
•Assurances from Halikos Hospitality that the pricing and priority terms and conditions agreed within the current contract 800575 will form the basis of the new variation document.
•Halikos Hospitality to manage the suitability of accommodation required by the Ichthys Project and to monitor and manage project accommodation does not adversely impact Tourism and Major Events.
•Ensure that Government and Industry bodies are informed of and maintain support.
•INPEX acknowledge that Halikos is a local Darwin company, has an international reputation of high standing and already provides excellent service to INPEX and our contractors.
•Halikos Hospitality Pty Ltd demonstrate it has the inventory to provide additional accommodation.
On the 13th February 2014, INPEX Operations Australia Pty Ltd provided to Halikos Hospitality Pty Ltd the minimum number of additional accommodation that project required to be secured and would be read in the preparation of the variation document.
Enclosed in this variation document presentation, Halikos Hospitality demonstrates its ability to provide the additional accommodation and undertake the additional responsibilities and duties as the project Accommodation Services Provider.
Sincerely
Geoff Weeks
Executive General Manager – Halikos Hospitality Pty Ltd
[spelling and punctuation in original; emphasis by underlining added]
(d) There follows a section headed “Current Inventory” in which the Halikos Hospitality buildings are listed and described, and mention is made of the number of rooms available “for the Ichthys Project management contractors and sub-contractors”.
(e) The next section of the proposal is headed “Future Inventory”. That includes the following entry:
105 Mitchell Street Apartments
Due for completion in March 2015 will provide a further 254 hotel suites and apartment rooms specifically for the Ichthys Project management, contractors and sub-contractors.
This property will be the main hub for INPEX Operations Australia Pty accommodation requirements over the 15 years in the variation document for the construction, commissioning and operation phases. As the construction phase accommodation nears completion and its existing accommodation contract periods end, those apartment rooms and hotels will be released back to Halikos Hospitality Pty Ltd and used for additional Tourism accommodation requirements in Darwin.
(f) The section on inventory ends with this sentence:
No other company can provide the quantity and quality of accommodation required for the Ichthys Project. Halikos Hospitality is the “One Stop Shop”.
(g) The next section is headed “Document Overview”, and reads as follows:
Enclosed is the full set of documents making up 800575. The Contract Variation allows the following variation amendments and agreed by both parties.
•The variation of Accommodation Contract 800575 is to provide additional accommodation for the Ichthys Project and appointing Halikos Hospitality Pty Ltd as the primary Accommodation Services Provider for the Ichthys Project.
In relation to the finding at R [217] that Mr Dignan’s email to Mr Okawa of 11 September 2014 is inconsistent with the evidence given by Mr Dignan that he believed no decision note was necessary for the pleaded Additional Accommodation Variation, the trial judge failed to have any, or any sufficient, regard to:
38.1.Mr Wheeldon’s oral evidence that he had referred to the decision note in his email of 7 May 2014 in relation to the broader accommodation services provider agreement only;
38.2.Mr Dignan’s evidence that he understood that the decision note was just an INPEX internal process and that Mr Wheeldon had told him it had been completed and circulated in any event; and
38.3.the body of evidence that Messrs Wheeldon and Kildare reassured Mr Dignan not to worry and that he had the 13 February letter and Mr Wheeldon’s email of 21 July 2014.
In relation to the finding at R [219] to accept the evidence of Mr van der Linden (of INPEX) (and implicitly the truth of the facts stated) that, at a meeting with Mr Weeks on 29 September 2014, Mr van der Linden commented that the numbers looked different to what INPEX needed and said that no-one would agree to a 6% per year increase, the trial judge failed to have any regard to:
39.1.Mr Kildare’s email of 26 September 2014 to Mr van der Linden and Mr Davies with the subject “Tidying up after Chris Wheeldon’s departure” in which Mr Kildare, among other things, referred to the Halikos issue as remaining unfinished and stated “for some reason, [it] sits in my in-tray” and sought to discuss and agree how the issue would be resolved “now that Chris had departed and left us holding this baby”;
39.2.Mr van der Linden’s email of 27 September 2014 to Mr Sakamoto and Mr Bon (of INPEX) in which Mr van der Linden stated he had been in contact with Mr Kildare the previous day and set out, among other things, the following matters:
39.2.1.“Representation had been made to Halycos [sic] by CW than an additional 225 apartment units for the period running from feb 2014 to feb 2029; then going to 150 from 2019 to 2029!!”;
39.2.2.“A letter issued on Inpex letterhead confirming the same was issued on 13 February this year. This letter was signed by R.Davies acting under CW’s instructions- (the man himself conveniently being on ‘R&R’)”;
39.2.3.“The provision of these additional units would be executed under a variation to the existing accommodation contract”;
39.2.4.“Based upon these representations, Halycos [sic] have apparently started the development of a block on 105 Mitchell street”;
39.2.5.“Halycos [sic] had been led to believe that the signed variation would be forthcoming by CW, hence their phone call to Sean when the news of his departure broke”;
39.3.the subsequent email correspondence between Mr Okawa, Mr Bon and Mr van der Linden in the period to 29 September 2014, including Mr Okawa setting out that there was a “long story” which he would tell Mr Bon in full when they met in Tokyo;
39.4.the email correspondence in the period 27 to 29 September 2014 between Messrs Okawa, Sakamoto, Bon and van der Linden, concerning the Halikos issues and how Mr Wheeldon should be handled;
39.5.Mr Okawa’s oral evidence that he raised in an email the suggestion on about 29 September 2014 that a demand should be made upon Mr Wheeldon to pay compensation; and
39.6.Mr Okawa’s email of 30 September 2014 to Craig Hunter (of INPEX) in which he set out “CW made an unreasonable over commitment to Halikos regarding the new accommodation for INPEX workforce” and sought advice as to whether compensation could be obtained from Mr Wheeldon, even if a deed of release was signed.
In relation to the finding at R [221] that Mr Weeks’ email of 30 September 2014 and Mr Dignan’s email of 7 October 2014 are consistent with the terms of the agreement still being negotiated, the trial judge failed to have any, or any, sufficient regard to:
40.1.the minutes of the meeting (unchallenged) between Mr Okawa and Messrs Dignan and Weeks on 10 October 2014 (which meeting followed the above correspondence), which record “HO [Mr Okawa] acknowledged INPEX gave written instructions to Halikos to secure the additional accommodation as set out in the variation. (Letter dated 13/02/14 from INPEX Operations Australia Pty Ltd is referred)”.
In relation to the finding at R [236(n)] not to accept that in a telephone conversation on 30 October 2014 Mr Kildare said to Mr Weeks to the effect that at a meeting of key INPEX personnel earlier that day, INPEX’s legal counsel had stated that INPEX was both legally and morally obligated to comply with the Additional Accommodation Variation, the trial judge failed to have any regard to:
41.1.Mr Weeks’ note of that conversation (unchallenged) in which he recorded “SK advised the legal counsel informed them that INPEX was both legally and morally obligated to the additional accommodation in the variation.
In relation to the finding at R [250] that Messrs Weeks and Dignan were disabused well before 13 February 2014 that they could circumvent INPEX’s internal processes by casting the new agreement as a variation of the existing Accommodation Agreement, the trial judge failed to have any, or any sufficient, regard to:
42.1.Mr Wheeldon’s oral evidence that in 2013 he had told Messrs Dignan and Weeks that clause 3 could be used to obtain additional accommodation;
42.2.Mr Kildare’s oral evidence that Mr Wheeldon discussed the use of a variation (ie clause 3) at the meeting on 10 January 2014;
42.3.the contents of Mr Weeks’ email of 18 January 2014;
42.4.Mr Dignan’s and Mr Week’s evidence that at the 29 January meeting there was no mention of INPEX requiring additional internal processes to be completed and that it was their understanding that a variation for additional accommodation could be made legally binding by a letter of instruction under clause 3;
42.5.Mr Dignan’s evidence that at the 29 January meeting, Mr Kildare confirmed that Mr Wheeldon had the authority to vary the existing Accommodation Agreement;
42.6.the contents of Mr Dignan’s email of 29 January 2014, including the statement the “basis of our discussions was to seek a mutually agreed variation”;
42.7.Mr Wheeldon’s oral evidence that at the meeting of 6 February 2014, he discussed with Messrs Dignan and Weeks that the document would proceed by way of a variation to the existing agreement;
42.8.Mr Wheeldon’s oral evidence that by Mr Weeks’ email of 12 February 2014, Mr Wheeldon understood that Mr Weeks believed that the parties could move forward on the basis of an instruction to secure accommodation, without any decision note, whilst the Variation Document was being executed; and
42.9.Mr Wheeldon’s oral evidence that he had referred to the decision note in his email of 7 May 2014 in relation to the broader accommodation services provider agreement only.
In relation to the findings at R [273]:
43.1.not to accept that Messrs Dignan and Halikos had subjectively decided they would only go ahead with the development of H105 if they got some kind of binding pre-commitment from INPEX; and
43.2.that even if they did have such a subjective intention, they did not communicate it to INPEX,
the trial judge failed to have any, or any sufficient, regard to:
43.3.the body of evidence that it made no commercial logic and sense for Halikos to develop H105, which involved, in addition to the construction costs, shutting down the Top End Hotel (profitable), terminating leases (also profitable) and taking on a large loan facility, without having a binding commitment;
43.4.Mr Sakamoto’s email of 18 January 2014 to Mr Wheeldon in which Mr Sakamoto set out that a difficult side of the Halikos proposal discussed at the 17 January meeting was “making such commitment”, and his subsequent oral evidence that the two-week period of time mentioned was too short for INPEX to provide a “commitment, agreement, decision or any kind of support”;
43.5.the correspondence on 26 February 2014 between Mr Okawa and his personal assistant which revealed that there was a discussion within INPEX that Halikos sought a commitment from INPEX at that meeting; and
43.6.Mr Wheeldon’s oral evidence that Mr Sakamoto’s use of “commitment in a short time” was a reference to making a commitment to Halikos based upon the matters discussed at the 17 January meeting.
[1]Amended Statement of Claim (ASOC) [16].
[2] This document includes the AAV, but also includes two recitals, Recitals A and C, which are not pleaded as being part of the AAV. See ASOC [16] Particulars and [19]. See too [79] below.
[3] R [246] – [253].
[4] R [254] – [257].
[5] R [258] – [268].
[6] R [269] – [270].
[7] R [273].
[8] R [274] – [275].
[9] (1989) 19 NSWLR 158.
[10] (2001) 4 VR 28 at [27] – [28].
[11] (2005) 228 CLR 470 at [5].
[12] (2004) 140 FCR 17.
[13] Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd (2001) 4 VR 28 at [28]; Rollings v Rollings (2009) 230 FLR 396 [110]. See too Australian Red Cross Society v Queensland Nurses’ Union of Employees [2019] FCAFC 215 at [82].
[14] Expectation Pty Ltd v PRD Realty Pty Ltd (2004) 140 FCR 17 [69].
[15] Ibid [69]; Nais v Minister for Immigration and Multicultural and Indigenous Affairs [2005] 228 CLR 470 [5].
[16] Expectation Pty Ltd v PRD Realty Pty Ltd (2004) 140 FCR 17 [69].
[17] Ibid [70].
[18] Ibid [71].
[19] Ibid [72].
[20] Ibid [74].
[21] King & Ors v Australian Securities and Investments Commission [2018] QCA 352 at [49].
[22] Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816 [130] – [131] (Hayne J).
[23] Lemongrove Services Pty Ltd v Rilroll Pty Ltd [2019] NSWCA 174 (Lemongrove) at [32] (Payne JA, Bell P & Simpson AJA agreeing).
[24] Fox v Percy [2003] HCA 22; 214 CLR 118, 129 [31] (Fox v Percy) (Gleeson CJ, Gummow & Kirby JJ). See also Re Hillsea Pty Ltd [2019] NSWSC 1152 at [18] (Black J) quoting Fox v Percy.
[25] Camden v McKenzie [2008] 1 Qd R 39 [34] (Keane JA), cited in New South Wales v Hunt (2014) 86 NSWLR 226 [56] (Leeming JA, Barrett JA & Tobias AJA agreeing). See also Re Kit Digital Australia Pty Ltd (in liq) [2014] NSWSC 1547 at [7] (Black J); Re Hillsea Pty Ltd [2019] NSWSC 1152 at [20] (Black J).
[26] Re Kit Digital Australia Pty Ltd (in liq) [2014] NSWSC 1547 at [7] (Black J).
[27] Watson v Foxman (1995) 49 NSWLR 315, 319 (McClelland CJ); John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451 (John Holland) [94] (Hammerschlag J). See also Chou v Awap Sgt 26 Investment Ltd [No 3] [2018] WASC 383 [133].
[28] Gardenisle Pty Ltd v Johnson [2019] WASC 271 at [241] (Archer J); Re Sundell [2019] NSWSC 1108 at [114] (Sackar J); Re Hillsea Pty Ltd [2019] NSWSC 1152 at [21] (Black J).
[29] Watson v Foxman (1995) 49 NSWLR 315 at 318 – 319 (McClelland CJ) applied in Ingot Capital Investments v Macquarie Equity Capital Markets (No. 6) [2007] NSWSC 124; 63 ACSR 1 [353] – [355] (McDougall J). See also Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-363; Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 at [73] – [74].
[30] Watson v Foxman (1995) 49 NSWLR 315 at 318-319 applied in Aneve Pty Ltd v Bank of Western Australia Ltd [2005] NSWCA 441 [49] (Hodgson JA, Santow and Bryson JJA agreeing); Moukhayber v Cambden Timber and Hardware Co Pty Ltd [2002] NSWCA 58 [28] (Heydon JA, Beazley JA & Santow JJA agreeing); Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237 [159] (Warren CJ, Osborn JA & Macaulay AJA); Fuge v Commonwealth Bank of Australia [2019] FCA 1621 at [184].
[31] Moukhayber v Cambden Timber and Hardware Co Pty Ltd [29] (Heydon JA, Beazley & Santow JJA agreeing); John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [94] (Hammerschlag J).
[32] Robinson Helicopter Co Inc v McDermott [2016] HCA 22; 90 ALJR 679 (Robinson Helicopter) [43] (French CJ, Bell, Keane, Nettle & Gordon JJ) partly quoting Fox v Percy at [25] (Gleeson CJ, Gummow & Kirby JJ). See also Minister for Immigration and Border Protection v SZVFW [2018] HCA 30; 264 CLR 541 (SZVFW) at [32] (Gageler J); Lee v Lee [2019] HCA 28; 93 ALJR 993 at [55] (Bell, Gageler, Nettle & Edelman JJ).
[33] Fox v Percy [23] (Gleeson CJ, Gummow & Kirby JJ); Dearman v Dearman [1908] HCA 84; 7 CLR 549, 561 (Isaacs J). See also SZVFW at [33] (Gageler J).
[34] Fox v Percy [23] (Gleeson CJ, Gummow & Kirby JJ). See also SZVFW at [33] citing CSR Ltd v Della Maddalena [2006] HCA 1; 80 ALJR 458 at 465 [17]; and Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 at [75] citing Poulet Frais Pty Ltd v The Silver Fox Company Pty Ltd [2005] FCAFC 131; 220 ALR 211 at 220-221 [46]-[47] per Branson, Nicholson and Jacobson JJ.
[35] SZVFW at [33] (Gageler J) citing S W Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466, 478 (Gibbs CJ, Mason J agreeing).
[36] Robinson Helicopter at [43]; Fox v Percy [28] – [29] (Gleeson CJ, Gummow & Kirby JJ), [48] (McHugh J). See also Aldi Foods Pty Ltd v Moroccanoil Israel Ltd [2018] FCAFC 93 at [2] (Allsop CJ); and White v Philips Electronics Australia Ltd t/as Philips Healthcare [2019] NSWCA 115 at [36] (Bell J).
[37] Lee v Lee [2019] HCA 28; 93 ALJR 993 (Lee v Lee).
[38] Fox v Percy at 126-127 [25] per Gleeson CJ, Gummow and Kirby JJ; Robinson Helicopter at 686 [43].
[39] Fox v Percy at 128 [29] per Gleeson CJ, Gummow and Kirby JJ; Robinson Helicopter [43].
[40] Kakavas v Crown Melbourne Ltd (2013) 250 CLR 392 at 434‑435 [144]; [2013] HCA 25; Thorne v Kennedy (2017) 263 CLR 85 at 104 [42]; [2017] HCA 49.
[41] Warren v Coombes [1979] HCA 9; 142 CLR 531 (Warren v Coombes) at 551 per Gibbs A-CJ, Jacobs and Murphy JJ ; see also Fox v Percy at 127 [25].
[42] [2017] NSWCA 135 at [26].
[43] SZVFW at [34] (Gageler J); Fox v Percy [68] (McHugh J).
[44] SZVFW at [41] (Gageler J); Warren v Coombes at 551 (Gibbs ACJ, Jacobs & Murphy JJ); Fox v Percy at [87] (McHugh J).
[45] R [176] – [185].
[46] This was the other draft agreement referred to by Mr Dignan in his emails of 9 and 11 July. Mr Dignan emailed that document, Variation 800575-3, which he described as a “Primary Accommodation Services Provider Agreement”, to Mr Wheeldon on 15 July 2014. See AB Tab 62.
[47] See R [175] and Schedule A paragraphs [23.4], [23.5], [23.7], [23.17], [23.19] and [23.20].
[48] R [72].
[49] This is a mistaken reference to the letter of 13 February 2014.
[50] This was a copy of the letter of 13 February 2014.
[51] (1954) 91 CLR 353; [1954] HCA 72.
[52] See our discussions elsewhere about the alleged contract, and the trial judge’s observations at R [228] – [230]. Relevant to referring to recitals when construing a contract is Franklins Pty Ltd v Metcash Trading Ltd (2009) 76 NSWLR 603 at [29] and [379] to [390].
[53] [2004] HCA 35; 218 CLR 451 (Pacific Carriers Ltd v BNP Paribas)..
[54]Northside Developments Pty Ltd v Registrar General [1990] HCA 32; 170 CLR 146 at pp 200 and 212; Pacific Carriers Ltd v BNP Paribas at [38].
[55] R [243].
[56] Halikos Hospitality Pty Ltd v Inpex Operations Australia Pty Ltd [2019] NTSC 10 at [240], [244].
[57] R [249].
[58] R [8].
[59] R [11] at f/n 1.
[60] Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; 209 CLR 95 at [25].
[61] at R [256] – [257].
[62] Counsel for Halikos placed great emphasis on the fact that, in cross-examination, Mr Wheeler was referred to the words, “We will finalise for signing when Chris Wheeldon and myself return from our respective annual leave,” in an email from Mr Weeks, was asked what he thought that “contemplated”, and said, “They thought they had an agreement in place.” It is hard to see why he would have construed the email that way, but in any event, the evidence is that both Mr Wheeldon and Mr Kildare told Mr Weeks and Mr Dignan orally and in writing many times, from shortly after 17 February that INPEX’s normal internal procedures would need to be followed. What is more, they were advised this before 13 February in the meeting on 17 January, in Perth.
[63][1988] HCA 7; 164 CLR 387 per Brennan J at [34].
[64] Grandulovic v Borg Warner (Australia) Pty Ltd (Unreported, NSWCA, 1 December 1987) 10 (Kirby P).
[65] ASOC [32] – [34].
[66] ASOC [40]; R [269].
[67] R [269]. See ASOC [40] – [57].
[68] ASOC [58].
[69] R [272]. Her Honour noted that the precise nature of the alleged commitment was unclear both on the pleadings and the evidence.
[70]R [267].
[71] R [127] – [130].
[72] R [174] – [175].
[73] R [201] – [204].
[74] R [209] – [211].
[75] See R [265] – [266] and [270].
[76] Defence [5](b); Reply [5](c).
[77] ASOC [14](a); Defence [19](a).
[78] ASOC [14](b); Defence [19](a).
[79] R [19].
[80] R [23]; Defence [19](b); Reply [17](a)(i).
[81] R [25].
[82] R [26].
[83] R [27].
[84] R [28].
[85] R [38].
[86] R [42] – [45].
[87] Defence [69]; Reply [53].
[88] R [26]; Defence [5](b); Reply [5](c)(iii).
[89] R [26].
[90] The reference to the ‘C2 Agreement’ in that email was a reference to the original Accommodation Agreement.
[91] R [30].
[92] Defence [20](c); Reply [18](a).
[93] Defence [20](d); Reply [18](b).
[94] R [30].
[95] R [30].
[96] R [30].
[97] R [31].
[98] At R [27] the trial judge made reference to requests from Mr Weeks to Mr Wheeldon for “numbers” throughout 2013 and the early part of 2014 and to Mr Wheeldon’s responses, although it is not clear precisely what correspondence her Honour considered.
[99] This email was considered, at least in part, by the trial judge at R [28].
[100] R [37]; ASOC [15](d), [35](d); Defence [20](f), [83](a); Reply [18](d).
[101] ASOC [35](d)]; Defence [83](a).
[102] R [40].
[103] R [41]; ASOC [15](e); Defence [21].
[104] R [41].
[105] See for example R [20], [22], [38], [43], [45], [63(a)] and [272] – [273].
[106] R [47].
[107] Defence [22](a); Reply [19](a).
[108] ASOC [35](e); Defence [81](f).
[109] Schedule A [6.8] and [6.10.1].
[110] On a number of occasions the trial judge incorrectly referred to the 13 February 2014 meeting as the 13 January 2014 meeting.
[111] R [58(d)].
[112] See for example R [59].
[113] Cf R [60].
[114] See [68] to [104] above.
[115] ASOC [35](h); Defence [81](h).
[116] Defence [24](b)(ii); Reply [20](b)(ii).
[117] ASOC [15](g); Defence [23](a), [25]; Reply [21].
[118] R [74].
[119] R [75] and R [76].
[120] ASOC [15](g); Defence [23](a), [25]; Reply [21].
[121] R [78].
[122] ASOC [15](h); Defence [23](a).
[123] There is evidence that, at an earlier time, a minor variation was made to the Accommodation Agreement without going through the decision note, RFA etc process. (It was a matter of substituting rooms in one building for rooms in another without additional cost to INPEX.) It may be that this initially gave Mr Dignan and Mr Weeks the idea that a proposal for INPEX to take additional accommodation could be documented in a variation to the Accommodation Agreement without going through the usual process. If so, the evidence shows that they were informed otherwise, at the meeting on 17 January and in later discussions and correspondence, for example in the email from Mr Kildare on 16 April 2014, referred to in para [170] below.
[124] See too the first sentence in R [92] where the trial judge repeats her acceptance of that evidence.
[125] R [89].
[126] Defence [33](j); Reply [29](c).
[127] R [82] and [92].
[128] See [227], [240], [247] – [248], [266] – [269], [279], [283], [288], [298] and [302] above.
[129] R [94].
[130] See R [97] – [100].
[131] R [96].
[132] R [101].
[133] Defence [39](a); Reply [34](b).
[134] Defence [39](b); Reply [34](c).
[135] Defence [39](c); Reply [34](c).
[136] Her Honour identified and summarised the conduct relied on at R [236].
[137] R [109].
[138] R [156].
[139] We assume that her Honour was referring to one or more of the phrases “which is not the case”.
[140] This is a mistaken reference to the letter of 13 February 2014.
[141] R [183].
[142] R [184].
[143] R [185].
[144] R [186] – [221].
[145] R [199] – [200].
[146] R [201] – [204].
[147] R [205] – [206].
[148] R [208].
[149] R [209] – [212].
[150] R [213] – [221].
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