LRL (AUST) Pty Ltd v Drem Pty Limited

The dispute in *LRL (AUST) Pty Ltd v Drem Pty Limited* concerned the construction of a deed and the scope of an appellant's assumption of a third party's royalty obligation under a separate deed between unrelated parties. The matter came before the Court of Appeal of New South Wales.

The central legal issue before the court was whether the phrase "proportionate share or interest" within the deed could encompass a 100% interest, thereby obliging the appellant to assume the entirety of the third party's royalty obligation.

The Court of Appeal held that the language of the deed, when read as a whole and in its commercial context, permitted a "proportionate share or interest" to refer to a 100% interest. The court reasoned that the term "proportionate" did not necessarily imply a share less than the whole, but rather referred to the share or interest that the party held or was entitled to. In this instance, the appellant's assumption of the third party's obligation was interpreted as encompassing the entirety of that obligation. Consequently, the appeal was dismissed with costs.