McGrath v Beumer; Beumer v McGrath

[2010] NSWSC 892

CITATION:	McGrath v Beumer; Beumer v McGrath [2010] NSWSC 892
HEARING DATE(S):	8 July 2010
JUDGMENT DATE :	12 August 2010
JUDGMENT OF:	Studdert AJ
DECISION:	1 The notice of motion filed on 25 March 2010 is dismissed. 2 The notice of motion filed on 6 March 2010 is dismissed. 3 I order the plaintiff to pay the defendant’s costs on the notice of motion filed on 25 March 2010.
CATCHWORDS:	Construction of document - Mediation resulting in Heads of Agreement - Meaning and effect of clauses in document - Whether settlement of dispute between parties effected in light of events that transpired
LEGISLATION CITED:	Civil Procedure Act (NSW) 2005, s 73, s 73(1)(b) Firearms Act 1996, s 51
CATEGORY:	Principal judgment
CASES CITED:	Agricultural and Real Finance Pty Limited v Gardiner (2008) 251 ALR 322 Commonwealth of Australia v Verwayen (1990) 170 CLR 394 Grey v Pearson (1857) 6 H.L. Cas 61 Watson v Phipps (1985) 60 ALJR 476
PARTIES:	2008/289594 (formerly 2008/20540) (P) Paul John McGrath (D) Susan Gaynor-Beumer (nee Johnson) 2009/295165 (formerly 2009/13374) (P) Susan Gaynor-Beumer (nee Johnson) (D) Paul John McGrath
FILE NUMBER(S):	SC 2008/289594 (formerly 2008/20540); 2009/295165 (formerly 2009/13374)
COUNSEL:	Mr Andrew Martin (for Paul John McGrath) Mr Sydney Jacobs (for Susan Gaynor-Beumer)
SOLICITORS:	S & T Lawyers (for Paul John McGrath) Elrington Boardman Allport Solicitors (for Susan Gaynor-Beumer)

- 19 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
CIVIL LIST

STUDDERT AJ

THURSDAY 12 AUGUST 2010

2008/289594 (formerly 2008/20540) Paul John McGrath v Susan Gaynor-Beumer (nee Johnson)
2009/295165 (formerly 2009/13374) Susan Gaynor-Beumer (nee Johnson) v Paul John McGrath

JUDGMENT

: Paul John McGrath, to whom I shall refer for present purposes as the plaintiff, has two notices of motion before this Court in which Susan Gaynor-Beumer (nee Johnson) is the defendant and I will refer to her hereafter as the defendant. The later notice of motion was filed on 25 March 2010 and that has been the motion the subject of the hearing before this Court. The earlier notice of motion filed on 6 March 2010 sought relief in different terms and was not pursued. It ought not to remain on foot and I will later order that that notice of motion be dismissed. The orders sought in the notice of motion which proceeded were expressed as follows:

“1. A declaration pursuant to s73 of the Civil Procedure Act (NSW) 2005 , or in the alternative the Court’s inherent jurisdiction, that the proceedings have not been settled.

2. In the alternative to 1, a declaration pursuant to s 73 of the Civil Procedure Act (NSW) 2005 or in the alternative the Court’s inherent jurisdiction, that the heads of agreement contain an implied term that the rifle the subject of these proceedings would be returned to the plaintiff in the same condition in which it left the plaintiff’s possession in 2004.

3. Further to 2, a declaration that the defendant has breached the implied term.

4. Damages pursuant to s 73(1)(b) of the Civil Procedure Act (NSW) 2005 .

5. Such further or other order as this honourable Court sees fit.

6. Costs.”

2 The relief sought on the hearing was limited to the declaration sought in paragraph 1. The relief otherwise sought, and in particular the relief sought in paragraph 2 was not pressed, and I shall return to this presently.

3 It is necessary at the outset to record in summary some background features.

4 Proceedings were commenced in the Supreme Court of the Australian Capital Territory in which the plaintiff sought to recover damages for conversion of some personal property including a Mauser sporting rifle. For her part the defendant brought proceedings in the Local Court at Orange seeking to recover from the plaintiff money allegedly advanced together with interest. In December 2008 the proceedings begun in the Australian Capital Territory were transferred to this Court and in June 2009 an order was made that the proceedings in the Local Court also be transferred to this Court.

5 On 21 August 2009 there was a mediation held before Mr Paul Blackett SC and at that mediation the plaintiff and the defendant came to an agreement reflected in a document headed “Heads of Agreement”. This document is identified in an affidavit sworn by the plaintiff on 11 March 2010. (See paragraph 16 of the affidavit and pages 1-5 of Exhibit A.)

6 The agreement reached at the mediation contemplated that the Mauser rifle referred to in the Heads of Agreement and at that time in the possession of Glenn Alexander Thompson, a person identified in the Heads of Agreement as “GT”, be sold to the plaintiff. Recital F of the Heads of Agreement is in these terms:

“F. The Mauser Rifle has been sold to Mr Glenn Thompson (“GT”). To facilitate the settlement of the various disputes between SB and PM as set out in this document, GT has agreed with SB that he will sell the Mauser Rifle to PM for $2,200 - $2,300. That agreement is recorded in a facsimile dated 21 August 2009 from GT to Mr S Jacobs of Wentworth Chambers. Both parties have a copy of that letter.”

7 The parties expressly agreed in paragraph 1 of the Heads of Agreement that the defendant would pay to GT “the maximum sum of $2,300 within 7 days of this agreement for the purposes of procuring the transfer of the Mauser rifle from GT to PM (the plaintiff) or his nominees”.

8 Paragraphs 2 and 3 of the Heads of Agreement provided as follows:

“2. PM will do all things reasonably necessary including liaising directly with GT and attend at such premises as is necessary to effect the transfer by GT to PM of the Mauser Rifle according to law. SB and PM note that the Mauser Rifle to be transferred includes all reasonably necessary ownership documents including registration and transfer papers.

3. Upon the ownership of the Mauser Rifle and the reasonably necessary ownership or transfer papers relating to the Mauser Rifle being transferred and provided to PM or his nominee, then”


(a) The SB Proceedings will be dismissed with each Party to pay their own costs.

(b) the PM Proceedings will be dismissed with each Party to pay their own costs.”

9 Paragraphs 4 and 5 provided:

“4. The Parties will sign a Short Minutes in the form of annexures “A” and “B” hereto to give effect to the dismissal of the SB Proceedings and the PM Proceedings pursuant to this agreement.

5. PM records that if the Mauser Rifle cannot be transferred into his name, it is to be trasferred to Mr Bevan Brown licensed firearm dealer, of “Fyshwick Firearms”. Alternatively, PM may nominate such other person as is appropriate to be the transferee of the Mauser Rifle if Mr Bevan Brown cannot have it transferred into his name.”

10 The short minutes which were referred to in paragraph 4 provided for the making of orders by consent for the dismissal of the proceedings that had begun in the Supreme Court of the Australian Capital Territory and also the proceedings that had begun in the Orange Local Court.

11 The Heads of Agreement contained two clauses which have been the focus of the issues that have arisen on the notice of motion presently before the Court. These clauses are as follows:

“6. If for a reason that is not the fault of either GT or SB, the Mauser Rifle cannot be transferred to PM or his nominee, by 21 October 2009, together with the ownership and transfer papers, then the provisions of clause 3 shall apply.

7. If for reasons that are the fault of either GT or SB, the Mauser Rifle is not transferred to PM of his nominee by 21 October 2009, together with the ownership and transfer papers then this agreements [sic] shall be forthwith terminated (subject to any further agreement of the parties).

12 It is common ground that the Mauser rifle was not transferred to the plaintiff or his nominee by 21 October 2009 as provided for in the above two clauses. The plaintiff has submitted that as a consequence of this he is entitled to the declaration sought in paragraph 1 of the notice of motion.

13 It is submitted on behalf of the plaintiff that by reason of the operation of clause 7 of the Heads of Agreement that failure amounted to the breach of a condition precedent to the Heads of Agreement coming into effect, resulting in their immediate termination.

14 Mr Jacobs, however, submitted that there was no relevant fault by the defendant or by Glenn Thompson attracting the operation of clause 7. Alternatively, if there was a relevant breach by the defendant, this was waived by the plaintiff.

15 Before addressing these competing submissions it is necessary to record what occurred as between the parties concerning the rifle after the date of the mediation.

16 In her affidavit of 22 March 2010 the defendant deposed to the fact that she had arranged with Glenn Thompson to deliver the rifle to a location to be nominated and instructions to that effect were conveyed by the defendant’s solicitors to the plaintiff’s solicitors on 28 August 2009 (see page 7 of exhibit A). It was stated in that letter:

“We refer to previous correspondence and in particular the agreement reached at mediation, Friday 21 August 2009.

We advise that our client has arranged for the subject rifle to be sold by Mr Thompson to our client and then possession to be given to yours.

As we understand it your client is to obtain a document entitled ‘Intent to purchase a firearm’ and arrange for that document to be sent to Mr Glenn Thompson for further action.

Once Mr Thompson has all the relevant documentation, he will then take the necessary steps to enable the transfer of the rifle to your client.

We advise that neither our client nor Mr Thompson wishes to engage with your client in relation to this issue. Accordingly, we are instructed that Mr Thompson will deal with you by way of email correspondence. Further, the transfer of the rifle is to take place at the Police Station conveniently located near the location of the rifle. Mr Thompson will email either through you or your client these details once your client has provided the relevant documents.”

17 The solicitors proceeded to provide Mr Thompson’s email address. The letter went on:

“We advise that there is no further action for our client or Mr Thompson to take in relation to the transfer of the rifle, until your client has obtained the necessary paperwork to enable it to be done.”

18 On 15 September 2009 the defendant’s solicitors wrote again to the plaintiff’s solicitors and stated in part:

“In relation to the issue of transferring of the rifle, we are advised that Mr Thompson has not heard from your client at all. Further, we are advised that Mr Thompson has the rifle ready for collection. The only material required by Mr Thompson is for receipt of a transfer and statutory requirements to be completed.”

19 On 1 October 2009 the solicitors for the plaintiff sent an email to the solicitors for the defendant advising that the plaintiff was still waiting on the issue of his permit to acquire the rifle. On that same date the plaintiff inquired by email of the police department what had happened to the application he had made for the necessary permit to acquire.

20 The correspondence concerning the proposed acquisition of the firearm reflects an appreciation of the provisions of the Firearms Act 1996, and in particular s 51 thereof, which restricts the sale of a firearm to a purchaser not authorised to possess the firearm either by a licence or a permit.

21 The plaintiff received an email from the relevant police authority on 2 October 2009 notifying him that his permit had been issued on 24 September 2009, but it was said that the permit went to the wrong address.

22 On 8 October 2009 the plaintiff’s solicitors sent an email to the defendant’s solicitors advising that the permit to acquire the firearm had issued and that the plaintiff expected to receive the permit in the course of that week. Advice was sought as to the location of the police station to which Mr Thompson proposed to deliver the rifle.

23 On 12 October 2009 the solicitors for the plaintiff sent an email to the defendant’s solicitors and an email to Mr Thompson advising that the plaintiff had his permit by that time and a copy of the permit was attached. Mr Thompson was asked to deliver the Mauser to his nearest police station and to advise the relevant police officer that the plaintiff would attend at the station, produce the permit to acquire and take delivery of the rifle.

24 On 16 October 2009 a further email was sent to Mr Thompson from the plaintiff’s solicitors and a copy to the defendant’s solicitors complaining that there had been no response to the email of 12 October and emphasising that it was “a matter of extreme urgency” to ensure that the rifle was received by the plaintiff no later than 21 October 2009 “to avoid the termination of the agreement between the parties and the incurring of otherwise avoidable additional legal costs”.

25 However, on 19 October 2009 the defendant’s solicitors sent an email to the plaintiff’s solicitors advising that Mr Thompson had returned to Brisbane one week earlier and had no immediate plans to return to Sydney but that he could possibly be back in a fortnight. The email concluded:

“It is a shame that your client could not have got his act together in August”.

26 On 20 October 2009 the plaintiff’s solicitors sent an email to the defendant’s solicitors:

“Would you kindly ensure that Mr Thompson transfers the Mauser rifle to Paul McGrath on 21 October 2009 together with the ownership and transfer documents, or pursuant to the terms of clause 7 of the Heads of Agreement the said agreement will be forthwith terminated.”

27 That email prompted the following immediate response from the defendant’s solicitors:

“Clearly your request will not be complied with on the basis set out in my email. As suggested, this matter should be adjourned as you have previously suggested to allow this one final step to be completed.
Your client has had till early August to finalise this and now 9 days before the date there is a frantic rush with you threatening the termination of the agreement. Clearly we have complied with our requirements aside from the delivery of the rifle and that could only be done after your client obtained the necessary paperwork. Unfortunately this has only been a recent occurrence.”

(The reference to adjournment relates to a directions listing in this Court.)

28 There then followed this letter dated 20 October 2009 from the solicitors for the defendant to the plaintiff’s solicitors; which omitting formal parts reads as follows:

“We refer to previous correspondence in relation to this matter.

You have advised that on 12 October 2009, you sent via email, your client’s permit to acquire dated 24 September 2009. Further, you sought Mr Thompson’s assistance in the delivery of the rifle again, on 16 October 2009.

As stated in the writer’s email of 19 October 2009, at 8.22 am, Mr Thompson had returned to his home in Brisbane. Unfortunately, we are now instructed that Mr Thompson had returned to his home prior to 12 October 2009. Mr Thompson has a business which he runs out of Brisbane and Melbourne. It is unclear as to when Mr Thompson will be returning to his home in New South Wales. Further, there is no scope for the collection of the rifle without Mr Thompson being present.

Further, there is some issue as to whether any alternative arrangement could be made given the requisite licensing arrangements.

We note the content of your email of this date, sent 8.44 am. We reiterate our client’s position that, in our view, although we have not delivered the rifle, your client has clearly not given Mr Thompson nor ourselves time to obtain same. In our view, the essence of the agreement has been met and continues to be so.

Upon Mr Thompson’s return to New South Wales, we will arrange for the gun to be delivered to the nearest Police Station for your client’s collection and advise you of same.

Should you be instructed to terminate the Agreement we will, as previously advised, rely on this letter in any application for costs which may ensue.

We will, obviously, keep you updated as to the whereabouts of Mr Thompson, and in particular of his arrival in New South Wales for the transfer of the rifle.”

29 The above letter prompted the following email response:

“Craig (a reference to the defendant’s solicitor with the conduct of the matter)

Thank you for your letter of 20/10/09

It is not so much a question of us electing to terminate the Agreement, but rather, it is what the parties agreed would happen, if your client failed to duly effect the transfer of the Rifle

It was imperative that your client ensured that Mr Thompson was ready to transfer to the Rifle as soon as the paper work was finalised with the Police

Please provide us with copies of all:

1 emails,

2 correspondence &

3 notes of phone calls,

that you & your client made to ensure that Mr Thompson would be in a position to transfer the Rifle as soon as the paper work was finalised with the Police

Regards

Fil Giles
Solicitor …. ”

30 It seems that Mr Thompson is a pilot who flew his own aircraft. On 23 October 2009 the defendant’s solicitors advised the plaintiff’s solicitors by email that his plane was being repaired and that “he should be back in Orange late next week”. It was also stated that Mr Thompson would arrange for the transfer of the rifle through a registered dealer in Orange.

31 A further email was sent by the defendant’s solicitors to the plaintiff’s solicitors on 10 November 2009 informing that Mr Thompson would be in Orange in the next day or so.

32 Then on 18 November 2009 a further email was sent by the defendant’s solicitors to the plaintiff’s solicitors instructing that the Mauser rifle had been delivered to a licensed gun dealer, Bullets and Bits, at a stated address in Orange, and requesting that arrangements be made for the plaintiff to collect the rifle.

33 On 24 November 2009 the plaintiff’s solicitors sent an email to the defendant’s solicitors stating in part:

““To allow sufficient time for Paul to travel to Orange and inspect the rifle I suggest that Fridays Directions be adjourned to Friday 11 December 2009. Subject to Paul’s satisfactory inspection, I will then file the appropriate settlement papers. If you are agreeable to that adjournment, please advise by return and I will so inform the Registrar.”

34 On 25 November 2009 the plaintiff’s solicitors communicated with the Registrar of this Court:

“I act for the plaintiff Paul McGrath.
The above matters are listed for directions on Friday 27 November 2009. Mr McGrath will need approximately 1 week to collect, inspect and subject to satisfactory inspection accept the subject rifle….
With consent of the defendant, will you please vacate 27/11/09 and relist for 11/12/09”.

35 On 25 November 2009 the plaintiff travelled overseas and did not return to Sydney until 11 December 2009, on which date he travelled to Orange to inspect and to collect the rifle (see paragraph 41 of his affidavit of 11 March 2010). According to the plaintiff there were defects which he observed in the rifle (as recorded in paragraph 42 of his affidavit) and he took it from Bullets and Bits to the proprietor of Fyshwick Firearms in Canberra. Following its inspection and report from Mr Brown, the proprietor of Fyshwick Firearms, he took the rifle back to Orange on 14 December 2009 on which date his solicitors sent an email to the defendant’s solicitors advising that the plaintiff would not be accepting delivery of the rifle because it was in a different condition to that which it had been in when it left his possession (see page 32 of Exhibit A). The email concluded:

“It was clearly implied that Mauser to be returned to Paul had to be the same Mauser in the same or similar condition to the Mauser, when it last in his possession

The Mauser does not comply with that condition

Paul offers your client 2 options:

A Retain the Mauser & pay Paul its value of $15,200 within 14 days, or

B Consent to the termination of the Heads of Agreement & resume the proceedings”.

36 The proposals in the email of 14 December 2009 were rejected by letter from the defendant's solicitors dated 16 December 2009 (see Exhibit A p 34).

37 There are references through the communications recorded above to adjournments of proceedings in this Court. The proceedings referred to were the matters the subject of the mediation. After the mediation there were a number of directions hearings. Because of the terms of the Heads of Agreement the Registrar in this Court was requested to adjourn the matters, (being the causes transferred to this Court) until 30 October 2009. On 30 October 2009 the matters were adjourned for directions until 13 November 2009. The matters were further adjourned to 27 November 2009, 17 December 2009 and further to 5 February 2010. On 5 February 2010 the parties were directed to file and serve any motions together with any evidence in support by 24 February 2010. At a further directions hearing on 26 February a timetable was set for evidence and submissions in relation to the plaintiff's motion presently before the Court. A directions hearing took place on 31 March 2010 concerning this motion. A return date was fixed for subpoenas and there was a further listing on 21 April 2010 when the hearing of the motion was fixed for 8 July 2010.

38 This brings me to a consideration of the basis of the claim for relief presented by the plaintiff.

39 The plaintiff relies upon s 73(1) of the Civil Procedure Act 2005 which provides:

"73 Power of court to determine questions about compromises and settlements

(1) In any proceedings, the court:
(a) has and may exercise jurisdiction to determine any question in dispute between the parties to the proceedings as to whether, and on what terms, the proceedings have been compromised or settled between them, and
(b) may make such orders as it considers appropriate to give effect to any such determination."

40 The language of the above subsection is clear and Mr Jacobs does not contend on behalf of the defendant that the Court does not have jurisdiction to grant the relief sought. The question is whether it is appropriate to do so in the circumstances of this case.

41 In his succinct submissions Mr Martin referred to facts not in dispute:

(1) that at all relevant times the rifle was in the possession of Glenn Thompson,
(2) that it was not transferred to the plaintiff by 21 October 2009.

42 In these circumstances Mr Martin submitted that the provisions of clause 7 of the Heads of Agreement were enlivened. It transpired that the rifle was not transferred to the plaintiff by 21 October 2009 and it is submitted that this was for reasons that were “the fault” of Glenn Thompson. Mr Thompson was aware by 24 August 2009 of the need for him to deliver the rifle to a location nominated by the defendant (see paragraph 22 of the defendant’s affidavit 22 March 2010), although Mr Thompson was not notified then of the time frame. The rifle could have been left at the Orange Police Station or at Bullets and Bits before Mr Thompson left for Queensland. In any event, Mr Martin submitted, the word “fault” as used in paragraphs 6 and 7 of the Heads of Agreement means no more than “failure”. The provisions of clause 6 do not apply because there was a failure by Mr Thompson to deliver within the specified time frame and by reason of clause 7 the consequence of this failure was that the Agreement was terminated.

43 Mr Jacobs submitted that the two clauses, clauses 6 and 7, had to be read together. The earlier clause contemplates “a reason” and the later clause contemplates “reasons”. The intention to be drawn from the language used in the clauses was that different purposes were contemplated in each clause. What was contemplated for clause 6 to have effect was that there should be a reason other than the fault of GT or SB which prevented the transfer of the rifle by the specified date. If there was such a reason then clause 3 was to take effect. On the other hand if there were reasons for the transfer of the rifle not to take place by the specified date and these reasons were attributable to the fault of either GT or SB then clause 7 provided the machinery for termination of the agreement forthwith.

44 It is well settled of course that the words of a contract are to be construed in their grammatical and ordinary sense unless modification is required to avoid some absurdity or some repugnance, or inconsistency in the context of the document in which the words are used: see the much cited dicta of Lord Wensleydale in Grey v Pearson (1857) 6 H.L. Cas 61 at 106; see also Watson v Phipps (1985) 60 ALJR 476, and the judgment delivered by Lord Brightman.

45 The function of the Court is to ascertain what the parties here meant by considering the language they employed in the context of a document that was intended to record the terms of the resolution of litigation achieved at a mediation.

46 It was a document prepared by lawyers. The use of the words “a reason” in clause 6 and the words “for reasons” in clause 7 I treat as having been quite deliberate. On reflection, I am persuaded that clause 6 is to be approached in the manner for which Mr Jacobs contended. Even if there was a reason that the rifle could not be transferred in time which was attributable to the act or omission of GT, provided there was also a reason accounting for the non transfer by the defined date not attributable to GT then clause 6 was to have effect.

47 The agreement reflected in the document under consideration was reached on 21 August 2009. This set a date for the transfer of the rifle two months later. Having regard to the provisions of s 51 of the Firearms Act, the parties to the agreement recognised, as was reflected by their conduct, that before the possession of the firearm could properly be taken by the plaintiff it was necessary for him to obtain the requisite permit to acquire from the Police Force Firearms Registry. This document did not become available to the plaintiff until about 12 October 2009, some nine days before the last date fixed for transfer by the Heads of Agreement. The delay appears to have been attributable at least in part to the Firearms Authority not having the plaintiff’s correct address. By that time it seems Mr Thompson was already in Brisbane. It was not until 16 October 2009 that a copy of the permit was forwarded to the solicitor for the defendant. This left a period of only five days before 21 October 2009 within which Mr Thompson might effect the transfer of the rifle to meet the time set by clauses 6 and 7.

48 Mr Thompson had to return from Brisbane to this state to make the transfer and it seems for two of the five available days his plane was not airworthy. Even if Mr Thompson could have returned to New South Wales in that five day period this was a narrow window of opportunity. In these circumstances, I consider there was “a reason” not attributable to either Mr Thompson or the defendant which contributed in large part to the non delivery by the appointed date. Most of the period from 21 August 2009 to 21 October 2009 had passed before Mr Thompson was alerted to the fact that the plaintiff had obtained the necessary permit. Moreover that permit only came into the possession fo the plaintiff some 9 days before 21 August 2009.

49 Hence it seems to me clause 6 is enlivened because there was “a reason” not attributable to either Mr Thompson or the defendant accounting for the non transfer, namely the delay in obtaining the necessary permit. This clearly contributed in a very significant way to the effluxion of the available two month period.

50 There is a further consideration concerning clauses 6 and 7. What does the word “fault” mean in the context of the document? Mr Martin submitted that the word simply means “failure” and no more than that. I do not accept this submission. It seems to me (drawing on the Macquarie Dictionary), that the word “failure” connotes “an act of failing” or “a lack of success” or “the non performance of something due or required”. On the other hand “fault” connotes “culpability” or “blameworthiness”. Again I am fortified in so defining it by reference to the Macquarie Dictionary and by considering the word in its context in this document. It seems to me that the word “fault” where used in clauses 6 and 7 introduces an element of blameworthiness, and I am by no means persuaded that in the circumstances of this case any blame was to be attributable to Mr Thompson for his failure to hand over the weapon by 21 October 2009, having regard to the limited opportunity to do so after the plaintiff obtained the necessary permit, and Mr Thompson was notified of this.

51 In the course of oral submissions Mr Martin acknowledged that Mr Thompson ought properly to have had a reasonable opportunity to provide the rifle from the time that the plaintiff was in a position lawfully to receive it. I do not consider that the period between 16 and 21 October 2009 afforded a reasonable opportunity, and I am not unmindful of the fact that at the critical time Mr Thompson, who is not a party to the litigation, was in Brisbane attending to his own affairs.

52 For the above reasons I do not consider that fault is to be attributed to Mr Thompson for the non transfer by the specified date. I do not understand Mr Martin to have contended that there was fault on the part of the defendant herself in the sense of blameworthiness, and in any event I find none.

53 Hence I conclude that clause 6 did take effect in the events which happened and not clause 7.

54 Counsel addressed submissions to the question of waiver and whilst it is not strictly necessary for me to deal with this issue I propose nevertheless to do so.

55 Mr Jacobs submitted that even if in the events that occurred the plaintiff was entitled to act upon clause 7 and to treat the agreement as terminated, he did not do so. On the contrary by his conduct and the conduct of his solicitors acting on his behalf he proceeded as though the agreement was on foot. On the other hand Mr Martin submitted that, on the face of it, clause 7 terminated the agreement on 21 October 2009. Whilst the email of 14 December 2009 (see paragraph 35, above) might be regarded as having made an offer in the terms expressed there was no acceptance of that offer. Mr Martin submitted waiver did not arise.

56 I set out earlier in this judgment the exchange of communications between the plaintiff’s solicitors and the defendant’s solicitors from 20 October 2009 onwards (see paragraphs 26-36). The content of those paragraphs bear upon the issue now being considered.

57 I referred earlier (at paragraph 35) to the plaintiff’s absence overseas between late November and 11 December 2009. On 11 December 2009 the plaintiff went to Orange, inspected the rifle and took possession of it. Having done so the plaintiff took the rifle to Fyshwick Firearms for inspection and report before returning the rifle to Orange three days later. It was when the rifle was returned that it was asserted by email that there was an implied condition of the agreement that the rifle would be returned in the same or similar condition to the condition it was in when it was last in the plaintiff’s possession (see paragraph 35, above).

58 It was this assertion as to an implied term which appears to have been the focus of the directions hearings concerning the notice of motion presently before this Court. For instance, by directions on 26 February 2010, the plaintiff was required to serve all evidence in support of its motion along with written submissions outlining all bases/causes of action to be relied upon including, but not limited to the implied term contended for by 10 March 2010 and the defendant was given a period to respond. Then directions as to evidence were given on 21 April 2010, at which time the experts qualified were directed to confer and report on matters agreed and disagreed, with that reference to take place by a time specified. These experts were firearms experts qualified to give evidence as to the condition and value of the rifle. The notice of motion itself expressed proposed orders 1 and 2 in the alternative, but the focus of preparation for the hearing as reflected in the evidence filed and in the submissions of counsel for the defendant addressed the implied term, failure to comply with which the plaintiff was contending had the consequence that there was no settlement.

59 Counsel for the plaintiff informed counsel for the defendant on 2 July 2010, only six days before the hearing, that the assertion of an implied term and hence the relief in paragraph 2 of the notice of motion was not being pursued.

60 Mr Jacobs referred in submissions to the Commonwealth of Australia v Verwayen (1990) 170 CLR 394 and to Agricultural and Real Finance Pty Limited v Gardiner (2008) 251 ALR 322 where the concept of waiver was considered. Of course I heed the principles to be found in these decisions as to waiver. Ultimately it seems to me that the fundamental issue here is whether the plaintiff acted in such a way after 21 October 2009 that he ought not to be permitted to rely on the termination provision expressed in clause 7 of the Heads of Agreement. In my view he did so act. I have come to this conclusion after considering all the evidence as to what occurred subsequent to 21 October 2009. In particular, from the time that the plaintiff took possession of the rifle on 11 December 2009, he appeared to be proceeding on the basis that there was an agreement in existence, but that it contained an implied term as to the condition in which the rifle would be returned. He claimed an entitlement to relief for its breach. It was only days before the hearing of this Motion that reliance upon the asserted implied term was abandoned and the defendant was alerted to the basis upon which the matter was finally presented.

61 The plaintiff fails on the notice of motion filed on 25 March 2010 and the earlier notice of motion filed on 6 March 2010 is also to be dismissed.

62 The costs of the notice of motion filed on 25 March 2010 ought follow the event.

Formal Orders

1 The notice of motion filed on 25 March 2010 is dismissed.

2 The notice of motion filed on 6 March 2010 is dismissed.

3 I order the plaintiff to pay the defendant’s costs on the notice of motion filed on 25 March 2010.

**********