Hickson v Goodman Fielder Limited

The High Court of Australia considered an appeal by Hickson against a decision of Goodman Fielder Limited. The dispute concerned the interpretation of a clause within a deed of settlement, specifically whether it imposed a personal obligation on Goodman Fielder to pay Hickson a sum of money, or if the obligation was conditional upon Goodman Fielder receiving funds from a third party.

The central legal issue before the High Court was the proper construction of clause 4(a) of the deed of settlement. This clause stipulated that Goodman Fielder would pay Hickson a specified amount, but it was qualified by the phrase "provided that Goodman Fielder shall have received payment in full from the purchasers of the shares in Goodman Fielder Australia Limited." The court had to determine whether this proviso created a condition precedent to Goodman Fielder's obligation to pay, or if it merely described the source from which Goodman Fielder intended to make the payment.

The High Court held that the proviso in clause 4(a) constituted a condition precedent. Their Honours reasoned that the language used in the clause clearly indicated that Goodman Fielder's obligation to pay Hickson was contingent upon Goodman Fielder first receiving the specified payment from the purchasers of the shares. The court applied the principle that clear and unambiguous language in a contract or deed will be given its ordinary meaning, and that a proviso introduced by "provided that" typically signifies a condition. As Goodman Fielder had not received payment in full from the purchasers, the condition precedent had not been satisfied, and therefore, Goodman Fielder's obligation to pay Hickson had not arisen.

The High Court allowed the appeal and set aside the orders of the court below.