Horton Geoscience Consultants Pty Ltd v Energy Minerals Pty Ltd

Horton Geoscience Consultants Pty Ltd sought to appeal against a judgment in relation to a joint mineral exploration venture agreement with Energy Minerals Pty Ltd. The court was asked to determine the proper construction of the agreement and whether the obligation of Horton Geoscience to pay the whole of the expenses applied only to the first year of the agreement, after which the common law principle of equal sharing of expenditure would apply. The court also had to consider the admissibility of extrinsic evidence to prove the intention of the parties in relation to the agreement.
The court found that there was a latent ambiguity in the agreement which required the use of extrinsic evidence to determine the intention of the parties. The court found that the parties intended for Horton Geoscience to pay the whole of the expenses for the first year only, after which the expenses would be shared equally. The court also found that the respondent was entitled to an indemnity certificate for the costs of the appeal.
The court allowed the appeal, varied the judgment of the District Court, and ordered that each party pay its own costs of and incidental to the proceedings at first instance. The respondent was also ordered to pay the applicant-appellant's costs of and incidental to the application for leave to appeal and appeal to be assessed.