Paramount Haulage Pty Ltd v Farooq

[2023] WASC 367

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   PARAMOUNT HAULAGE PTY LTD -v- FAROOQ [2023] WASC 367

CORAM:   LUNDBERG J

HEARD:   26 SEPTEMBER 2023

DELIVERED          :   28 SEPTEMBER 2023

FILE NO/S:   CIV 1401 of 2023

BETWEEN:   PARAMOUNT HAULAGE PTY LTD

Plaintiff

AND

UMAR FAROOQ

First Defendant

ANAM AHMED

Second Defendant

BURK FUEL DISTRIBUTORS PTY LTD

Third Defendant

BURK PTY LTD

Fourth Defendant

BURK FUEL PTY LTD

Fifth Defendant

BURK HOLDINGS PTY LTD

Sixth Defendant

BURK RETAIL PTY LTD

Seventh Defendant

UMAR FAROOQ HOLDINGS PTY LTD

Eighth Defendant

Catchwords:

Practice and procedure - Summary judgment sought by plaintiff - Declarations sought as to construction and breach of long-term Fuel Transportation Agreement - Plaintiff pleads that the exclusivity granted by the agreement precluded counterparties from performing services themselves - Whether agreement repudiated by plaintiff - Dependency of pricing clause and exclusivity clause - Disputed questions of fact - Whether relief has utility - Some other reason for case to be tried - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA), O 14 r 1(1), O 14 r 3(1)

Result:

Application dismissed

Category:    B

Representation:

Counsel:

Plaintiff	:	Mr A J Tharby
First Defendant	:	Mr R J Price
Second Defendant	:	Mr R J Price
Third Defendant	:	No appearance
Fourth Defendant	:	Mr R J Price
Fifth Defendant	:	Mr R J Price
Sixth Defendant	:	Mr R J Price
Seventh Defendant	:	Mr R J Price
Eighth Defendant	:	Mr R J Price

Solicitors:

Plaintiff	:	Bennett
First Defendant	:	P A Martino
Second Defendant	:	P A Martino
Third Defendant	:	No appearance
Fourth Defendant	:	P A Martino
Fifth Defendant	:	P A Martino
Sixth Defendant	:	P A Martino
Seventh Defendant	:	P A Martino
Eighth Defendant	:	P A Martino

Case(s) referred to in decision(s):

Abu Dhabi National Tanker Co v Product Star Shipping Ltd (No 2) [1993] 1 Lloyd's Rep 397

Casella v Hewitt [2008] WASCA 13; (2008) 36 WAR 1

Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd [2013] VSC 614

Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87

Field Camp Services Pty Ltd v Site Accommodation Pty Ltd [No 2] [2012] WASCA 27

Foran v Wight (1989) 168 CLR 385

Geraldton Building Co Pty Ltd v Christmas Island Resort Pty Ltd (1992) 11 WAR 40

Helmers v Como [2014] WASC 394

Lavigne v Kumar [2020] NSWSC 1120

NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2020] WASCA 107

Paragon Finance plc v Nash [2002] 1 WLR 685

Sharjade Pty Ltd v Commonwealth [2009] NSWCA 373

Sutton Investments Pty Ltd v Realistic Investments Pty Ltd [2017] WASCA 14

Table of Contents

A.     Introduction

B.      Relevant materials

C.     Factual background and primary issues

D.     Relevant principles

E.      Disposition

Procedural requirements

Issues or questions in dispute which ought to be tried

Broader matters

Conclusion

F.      Orders

ATTACHMENT A

LUNDBERG J:

A.     Introduction

1. These reasons concern a summary judgment application brought by the plaintiff (Paramount Haulage) pursuant to O 14 r 1(1) Rules of the Supreme Court 1971 (WA) (RSC), by chamber summons dated 29 May 2023.  The plaintiff's claim is for declarations and damages arising from an alleged breach of a long‑term fuel transportation contract on the part of the defendants. 

2. The defendants, other than the third defendant (Burk Fuel Distributors) which has not yet entered an appearance, oppose the application and seek unconditional leave to defend the action.  The board of Burk Fuel Distributors is apparently deadlocked and unable to authorise the entry of an appearance.[1]  In these reasons, I will use the term defendants to refer to the defendants other than the third defendant.

   [1] As Burk Fuel Distributors is jointly owned by the two camps to this litigation, the inability of the company to file an appearance is not surprising.  I anticipate that this entity will, in due course, simply abide the overall result in the litigation.

3. For the reasons set out below, I consider the plaintiff's summary judgment application should be dismissed.

B.     Relevant materials

1. The application is supported by the affidavit of Mr Prempreet Singh affirmed 29 May 2023.  The defendants have filed an affidavit in opposition sworn by Mr Umar Farooq on 26 June 2023, to which Mr Singh affirmed a reply affidavit on 7 July 2023.  These were the only affidavits relied upon by the parties at the hearing.  No objections were raised to the receipt of any of the affidavits.  I will refer to the affidavits as the First Singh Affidavit, the Second Singh Affidavit and the Farooq Affidavit.

2. The plaintiff filed an outline of submissions dated 19 September 2023 (Plaintiff's Submissions), and the defendants filed an outline on the same date (Defendants' Submissions).

3. A relatively detailed statement of claim has been filed setting out the plaintiff's claims.  The defendants have provided to the court a minute of their proposed defence and counterclaim, in conjunction with their outline of submissions.

C.     Factual background and primary issues

1. The statement of claim and the affidavits of Mr Singh describe a factual setting which centres around a long‑term Fuel Transportation Agreement which was executed on 16 May 2022 (Agreement).[2]  The plaintiff was a party to that Agreement, together with all of the defendants. 

   [2] First Singh Affidavit, Attachment PS-9 (which is the Agreement).

2. In essence, the defendants (defined as the 'Recipients' in the Agreement) contracted for the plaintiff to exclusively provide to the defendants (and their related entities) transport fuel services from suppliers to various retail fuel sites (being the 'Services' defined in the Agreement) which are, or were, controlled by two of the defendants (namely, the fourth and fifth defendants).  This was to be undertaken by way of fuel tanker trucks.  The Agreement was to commence operation from 1 May 2022 and run until 1 May 2032, being a term of 10 years.[3]  The long-term nature of the Agreement is an important feature to which regard must be had in construing the terms of the instrument, according to the defendants.

   [3] Agreement, cl 1.1, cl 2.1, and Schedule 1.

3. There is an additional instrument identified in the pleadings and the evidence, being the Shareholders' Deed executed on 17 June 2022 (Shareholders' Deed).[4]  Although this instrument was executed after the Agreement, and not before it as one might ordinarily expect, I understand nothing turns on this timing issue for present purposes.  The interests of Mr Singh and the interests of Mr Farooq executed the Shareholders' Deed together with the jointly owned company, Burk Fuel Distributors.  That entity is 30% owned by the Farooq interests and 70% owned by the Singh interests. 

   [4] First Singh Affidavit, Attachment PS-8 (which is the Shareholders' Deed).

4. In Attachment A to these reasons, in order to properly understand the relationships between the parties and entities, I have diagrammatically shown the various parties to the action, the arrangements which have been executed, and the additional persons and entities who are material to those arrangements.  That diagram is drawn from information which is the subject of the affidavit material filed by the parties.

5. The primary business identified by the Shareholders' Deed is the transportation of fuel.  Mr Farooq's holding company was obliged to procure the 'exclusive rights of fuel transportation' either (i) for the benefit of Burk Fuel Distributors (in which case Burk Fuel Distributors was obliged to subcontract the transportation services to the plaintiff or other entities associated with Mr Singh), or (ii) to the plaintiff directly.[5]  The relevant parties were then obliged to enter into a transportation agreement detailing the exclusive rights fuel transportation arrangement.  As already noted, that Agreement had already been executed by the time the Shareholders' Deed was signed.

   [5] Shareholders' Deed, cl 6.1(b).

6. The plaintiff pleads out the various express terms of the Shareholders' Deed and the Agreement which refer to the exclusive nature of the arrangement with the plaintiff.  However, there is no specific plea within the statement of claim as to the proper construction of the Agreement in this regard. 

7. Nonetheless, the essential aspects of the instruments are pleaded sufficiently to provide prima facie support for the first prayer for relief, which is for declaratory relief that the 'Recipients' were not permitted to perform the 'Services'.  There are also declarations sought as to the defendants' breach of the Agreement.[6]  The precise declarations sought are as follows:

   A.A declaration that the Agreement does not permit the Recipient to perform the Services themselves and such performance constitutes a breach of the Agreement.

   B.A declaration that the Recipients have breached the Agreement by reason of performing the Services themselves or allowing another Recipient or another of the Recipient's Related Entities to perform the Services.

   [6] Statement of Claim [12] ‑ [15] (Shareholders' Deed terms) and [16] ‑ [29] (Agreement terms) and [40] (breach).

8. The plaintiff seeks summary judgment in respect of these prayers for relief.  The plaintiff also claims damages and interest, but does not seek summary judgment in respect of those matters.

9. It is helpful to set out the central clauses of the Agreement on which the plaintiff relies to support its claim.  The central provisions are found in the Recitals and in cl 2 of the Agreement.  The defendants' case relies on the terms and effect of cl 4 of the Agreement, which I should also set out in the interests of completeness:[7]

   [7] Agreement, Recitals, cl 2 and cl 4.

   Recitals

   AThe parties comprising the Recipient have agreed to exclusively engage the Company to provide the Services to the Recipient's Related Entities, and the Company has agreed to provide the Services to the Recipient and the Recipient's Related Entities on the terms of this agreement.

   …

   2.Exclusive Engagement of Company

   2.1Subject to clauses 2.2 and 2.3, the Recipient hereby engages the Company to provide the Services to the Recipient and the Recipient's Related Entities during the Term, and the Company hereby accepts that engagement and agrees to provide the Services to the Recipient and the Recipient's Related Entities, in accordance with the terms of this agreement.

   2.2Subject to clause 2.4, the Recipient acknowledges and agrees that the Recipient's engagement of the Company under this agreement is exclusive in that the Recipient must not and must ensure that all of the Recipient's Related Entities do not engage any person or entity other than the Company to deliver fuel to the Sites during the Term.

   2.3Subject to clause 2.4, the Recipient guarantees and warrants that the Recipient and the Recipient's Related Entities will exclusively use the Company to deliver fuel to the Sites and will not engage any other person or entity for such purpose.

   2.4In the event that a party comprising the Recipient or any of the Recipient's Related Entities who have engaged the Company determine, acting reasonably, that a particular delivery of fuel by the Company has been delayed, the relevant party comprising the Recipient or the Recipient's Related Entity who has engaged the Company (as the case may be) may elect to engage another party to complete the delivery, however, once such delivery has been completed, the Recipient and the Recipient's Related Entities must continue to exclusively engage the Company to provide the Service.

   …

   4.Fees

   (a)In consideration for the provision of the Services by the Company from time to time during the Term, the relevant party comprising the Recipient or the relevant Recipient's Related Entity which receives the Services will pay the Company the fees specified in the schedule of fees provided by the Company to the Recipient on the Start Date, and as varied by the Company from time to time (the Fees).  The Company will invoice the relevant party comprising the Recipient for Fees on each occasion following the provision of the Services.

   (b)The parties acknowledge and agree that the Fees will be determined by the Company from time to time on the basis of the fair market price transportation costs which can reasonably be charged in the transportation market in Perth, Western Australia.

10. The factual background which gives rise to the present proceedings, according to the plaintiff's case, is the stated intention of Mr Farooq (which later manifested in conduct on his part, it is alleged) to no longer use the services of the plaintiff to transport fuel from suppliers to the fuel sites operated by the interests of Mr Farooq.  Rather, the plaintiff alleges that Mr Farooq proposed to have that role undertaken by one of the entities associated with him.  The first statement of intention in this regard was at a meeting between a number of the parties on 29 January 2023.[8]  I will return to that meeting later in these reasons.

    [8] First Singh Affidavit, [20] and Attachment PS-14.

11. As I apprehend it, there is no direct challenge by the defendants to the exclusive nature of the Agreement.  The absence of such a challenge is understandable given the relatively clear and express language used by the parties in the instrument to mark out the exclusive character of the bargain.  I have extracted the key provisions above.  The plaintiff therefore presses for summary judgment of the declarations identified above, with the intention that the action would be programmed to trial to deal with the quantum of the plaintiff's claim for damages (asserted to be in excess of $1.8 million) and any matters arising on the defendants' pleading.  

12. Herein lies one of the principal difficulties with the plaintiff's summary judgment claim - the factual narrative which the defendants intend to plead interweaves with, and through, the factual narrative pleaded by the plaintiff in support of its case.  Further to this, and more fundamentally, the defendants plead out a case which challenges essential elements of the plaintiff's claim. 

13. The defendants intend to plead a denial to the breach allegations and will rely on the conduct of the plaintiff and its representatives to demonstrate, they say, breaches of the Agreement by the plaintiff and conduct on the part of the plaintiff amounting to a repudiation of the Agreement.  The defendants assert that this conduct entitled them to terminate the Agreement, and they did so before the plaintiff purported to terminate.  In this regard, the defendants place reliance on the fee setting clause in the Agreement which I have extracted above (cl 4), which allowed the plaintiff to vary the fees during the currency of the arrangement and also place reliance on further matters said to have occurred at the meeting in late January 2023, to which I earlier referred.[9]  The defendants' response draws attention to the boundaries which they contend are found in cl 4, including the requirement that the fees must be determined 'on the basis of the fair market price transportation costs which can reasonably be charged in the transportation market in Perth, Western Australia'.

    [9] The relevant narrative is pleaded in the Minute of Defence and Counterclaim [64], under the heading 'Repudiation', and verified in the Farooq Affidavit [72] - [79].

14. Turning then to the meeting on 29 January 2023, the defendants contend that the following interchange occurred:

    (a)Mr Singh stated that the plaintiff was incurring a lot of costs to transport fuel, it was making losses and it therefore had no option other than to increase its rates significantly, and above the transportation rates advised under the first two fee determinations made by the plaintiff pursuant to cl 4 (in August 2022);

    (b)Mr Singh stated that if Mr Farooq and Ms Ahmed did not accept the foreshadowed rate increases, the plaintiff would need to sell its fuel trucks and tankers and exit its fuel transportation business; and

    (c)Mr Singh gave no indication of having or obtaining or considering (or of intention on his part to obtain and consider) any market data or information relevant to ascertainment of fair market transportation costs relevant to the fuel sites.

15. In these circumstances, the defendants will contend that the plaintiff evinced an intention to make additional determinations to increase fees by reference to transportation rates outside the allowable contractual boundaries of cl 4.  That is: (i) without the proposed higher fees being based on fair market transportation costs; (ii) with the transportation rates to be determined by reference to considerations other than fair market transportation costs; (iii) without first obtaining, and then duly considering, relevant and sufficient market data and information pertaining to fair market transportation costs and delivery services to the fuel sites.

16. Completing the defendants' narrative, I understand the defendants will further contend that Mr Farooq stated at the meeting that he refused to pay higher rates and that the transportation rates that the plaintiff had increased since it took over fuel transportation were not warranted.  In response, it is contended that Mr Singh advised that he would consider whether he was willing to sell its fuel trucks and tankers to one of Mr Farooq's corporate entities. 

17. I do not make any findings as to whether the meeting transpired in the manner alleged by the defendants or in the manner asserted by the plaintiff.  The foregoing merely recounts the defendants' allegations and the account which appears in the Farooq Affidavit.  I will return to the factual narrative and its legal consequences, as asserted by the defendants, in section E below.  Ahead of that, I should clarify the principles applicable to the determination of a summary judgment application, which are uncontroversial.

D.     Relevant principles

1. The principles governing summary judgment applications are well‑known.  I refer to the principles endorsed in the decisions of the Court of Appeal in Sutton Investments Pty Ltd v Realistic Investments Pty Ltd[10] and NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd.[11]  The principles include that the power to summarily terminate a proceeding must be attended with caution and it is only in the clearest of cases, when there is a high degree of certainty about the ultimate outcome of the proceedings if it went to trial, that summary judgment ought properly be granted.[12] 

   [10] Sutton Investments Pty Ltd v Realistic Investments Pty Ltd [2017] WASCA 14 [24], [33].

   [11] NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2020] WASCA 107 [51], [53] ‑ [55].

   [12] See more generally Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87.

2. The plaintiff of course carries the burden of persuading the court that the claim is a good one, that there is no defence to it, that leave to defend should not be granted and that judgment should be given for the plaintiff.  If the plaintiff can establish a prima facie right to summary judgment, the burden then shifts to the defendant to satisfy the court why judgment should not be given against it.[13]  The defendant assumes an evidentiary burden but the overall burden of persuasion remains on the party moving for summary judgment.[14]

   [13] Gething M, Curwood M and Joseph R, Civil Procedure: Western Australia (vol 1) [14.3.1].

   [14] Civil Procedure [14.3.1].

3. I accept that a defendant seeking to resist summary judgment does not have to show a defence on the balance of probabilities, but must at least show cause as to why there is an arguable defence.[15]

   [15] Field Camp Services Pty Ltd v Site Accommodation Pty Ltd [No 2] [2012] WASCA 27 [4].

1. The court is able to determine difficult questions of law on a summary judgment application but it will typically be appropriate to leave the determination of such questions for trial.[16]

   [16] Casella v Hewitt [2008] WASCA 13; (2008) 36 WAR 1 [36].

E.     Disposition

Procedural requirements

1. The procedural requirements for a summary judgment application under O 14 r 1(1) RSC have been met by the plaintiff.

Issues or questions in dispute which ought to be tried

1. The defendants have advanced several cascading arguments which they contend preclude summary judgment being granted on the present application.  On my assessment, these arguments have merit, at least so far as can be deduced at this early stage in the proceedings in the context of this interlocutory application.  Each of the defendants' arguments, whether taken in insolation or together, are sufficient in my view to preclude the grant of summary judgment on the basis that there is an issue or question in dispute which ought to be tried.  

2. Whether these arguments can ultimately be sustained will necessarily be a matter for trial, but they are sufficient to demonstrate an arguable defence at this stage, and not merely a counterclaim on the part of the defendants (although a counterclaim is also pleaded).  That is, these contentions arguably operate to defeat essential elements of the cause of action pleaded by the plaintiff for breach of contract.

3. Whether the plaintiff's relief can be affirmatively established will require a thorough assessment of all the factual circumstances which led to the termination of the Agreement, and will require the court to determine the proper construction of the Agreement.  This latter exercise is best not undertaken in an interlocutory setting.[17]

   [17] BGC Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [2019] WASC 248 [77] (Smith J). That decision was upheld on appeal in NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [94] (Murphy JA) and [130] ‑ [132] (Beech and Vaughan JJA).

4. The defendants' arguments are essentially underpinned by a series of allegations that the plaintiff breached the fee setting clause in the Agreement.  The defendants assert that, on the proper construction of cl 4 of the Agreement, alternatively by reason of an implied term of the Agreement (implied as necessary to give business efficacy), the plaintiff was obliged to ensure that fees determined and charged by it did not exceed fair market transportation costs. 

5. The defendants further contend there existed implied terms within the Agreement which required the plaintiff to exercise the fee setting power honestly and in good faith, and not arbitrarily, capriciously, or unreasonably.[18]  The defendants contend that the plaintiff ought not determine the fees based on irrelevant considerations, and must determine the fees by first obtaining and considering relevant and sufficient market data and information pertaining to fair market transportation costs and delivery services to the relevant fuel retail sites operated by the defendants.[19]

   [18] The defendants rely on, among other authorities, Paragon Finance plc v Nash [2002] 1 WLR 685 and Abu Dhabi National Tanker Co v Product Star Shipping Ltd (No 2) [1993] 1 Lloyd's Rep 397, in support of this proposition.

   [19] Defendants' submissions [8(a)] and Minute of Defence and Counterclaim [44] ‑ [46].

6. The defendants then point to the affidavit material and the proposed pleaded case to support the submission that there have been breaches of the fee setting clause in the Agreement by the plaintiff.  I need not detail all of these matters.  The factual material is set out in the proposed pleading in some detail and in the Farooq Affidavit.[20] 

   [20] Minute of Defence and Counterclaim [47] ‑ [63]; Farooq Affidavit [60] ‑ [70].

7. Counsel for the defendants submits that it is at least arguable that the obligations on the defendants to exclusively use the services of the plaintiff were interdependent with the obligations on the plaintiff to ensure that fees determined by it were based on fair market transportation costs and otherwise in accordance with the Agreement.  As the defendants assert these fee setting obligations or restrictions were not met, the plaintiff is unable to insist on performance of the obligations it says were breached (namely, the obligation to exclusively use the plaintiff to provide the fuel distribution services).[21]  Integral to this argument is the contention that the obligations are dependent on each other, as opposed to independent.  The defendants rightly note this is a matter of construction.[22]

   [21] Defendants' submissions [8(b)].

   [22] Geraldton Building Co Pty Ltd v Christmas Island Resort Pty Ltd (1992) 11 WAR 40.

8. However, counsel for the defendants submits that, even if the dependency argument is not made good, the breaches alleged on the part of the plaintiff were sufficiently serious to amount to repudiatory conduct and entitled the defendants to terminate.[23]  The defendants next submit that, by their conduct, they terminated the Agreement prior to the plaintiff purporting to terminate.[24]  Thus, it is said that the subsequent conduct of the plaintiff in purporting to terminate the Agreement was of no effect.[25]

   [23] Defendants' submissions [8(c)].

   [24] Defendants' submissions [8(d)].

   [25] Defendants' submissions [8(d)].

9. There are further arguments identified by the defendants, but I will mention only two of them briefly. 

10. The defendants submit that the plaintiff was not entitled to terminate because the plaintiff was not ready, willing and able to perform the Agreement.  The defendants recognise there is competing authority on this particular issue, which holds that a party is not disentitled from terminating a contract by reason of its own serious breach or its absence of readiness or willingness to perform, unless either the obligations breached are interdependent or the breach by the party wishing to terminate has caused the other party's breach.[26]  In further amplification of this issue, and to further highlight the contentious nature of the legal proposition, counsel for the defendants referred to the following passages from Cheshire & Fifoot during the hearing:[27]

    [21.26]  Readiness and willingness, tender.  A party itself unable or unwilling to perform a contract cannot complain of the other party's breach.  Readiness and willingness to perform 'goes to the cause of the action'.[28]  A party not ready and willing to perform therefore has no right to terminate for breach by the other party, even if the breach in question would otherwise justify termination.  However, some authorities assert that lack of readiness and willingness precludes termination for breach only if it caused the breach for which termination is sought.  Also, the principle may not apply to express contractual termination provisions, at least those indicating a contrary intention.

    Where a contract provides for contemporaneous or concurrent performances by the parties, each party must demonstrate its readiness and willingness to perform by tendering performance, in order to 'put the other in breach'.  For example, in a contract of sale for land the obligations of the purchaser and vendor to complete or 'settle' the sale are normally concurrent, and tender of payment or of documents of title respectively is a perquisite of termination by either party for failure to complete by the other.  (footnotes omitted, excluding the reference to Foran v Wight)

    [26] Referring to, by way of example, Sharjade Pty Ltd v Commonwealth [2009] NSWCA 373 [54], [57] (Hodgson JA); Lavigne v Kumar [2020] NSWSC 1120 [120] ‑ [123].

    [27] Cheshire and Fifoot Law of Contract (12^th ed, 2023) [21.26].

    [28] The footnote refers to Foran v Wight (1989) 168 CLR 385, 402 (Mason CJ), 451 (Dawson J).

11. The defendants ultimately submit that a serious breach or absence of readiness and willingness to perform on the part of the terminating party (here, the plaintiff) will deprive that party of its right to contractual damages based on the alleged termination, i.e. for expectation loss or loss of bargain.[29]  I accept this proposition is at least arguable.  A summary judgment application is not the vehicle for the ultimate resolution of these relatively complex questions of law.

    [29] Referring to Sharjade Pty Ltd v Commonwealth [57], [68] (Hodgson JA); [143] (Young JA); Lavigne v Kumar [123] ‑ [124].

12. There is then a final fall back argument posited by the defendants, which asserts that cl 4(b) of the Agreement is devoid of objective criteria and thus uncertain at law.  The defendants raise the prospect of invoking the general principle that a contract will be unenforceable for uncertainty or incompleteness, or because it is illusory, because it gives one party a complete discretion as to one or more essential terms of the contract; at least in the absence of a contractual requirement that the discretion be exercised in accordance with criteria specified in the contract.[30]  Again, this point is at least arguable.  

Broader matters

[30] Referring to Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd [2013] VSC 614 [72], [68] ‑ [71].

1. There are several broader points which should be noted. 

2. First, the declarations proposed by the plaintiff are drafted in terms of a breach of the Agreement, but say nothing as to whether the breach justified termination of the bargain.  Accordingly, even if granted, the declarations would not be sufficient to lay the foundation for the assessment of damages which the plaintiff seeks (which in argument was put as more than a mere breach of the Agreement, but rather is contended to constitute breaches on the part of the defendants of a sufficient seriousness to justify termination). 

3. Second, the grant of declaratory relief is discretionary.  I would be reluctant to grant declarations of this nature where there remain disputed questions of fact and where the entire circumstances of the matter have not been the subject of a thorough assessment by the court. 

4. Third, and allied to the second point, the granting of the first declaration sought lacks utility in the sense that, on any view, the parties are in a post‑termination environment and I am not satisfied there is any practical reason why the parties need to understand the scope and operation of this now‑terminated instrument. 

5. Fourth, even if summary judgment were to be granted in favour of the plaintiff, I struggle to see how there would be any saving in time or cost in the running of the balance of the litigation.  The assessment of damages and the entirety of the defendants' claim will require a multi‑day trial which will almost certainly need to traverse the matters which would otherwise be the subject of evidence on the plaintiff's statement of claim.  Putting this another way, it is apparent that the evidence in relation to the claim for summary judgment is substantially interwoven into the factual narrative of the remainder of the facts relative to the issues to be decided at a trial.[31] This points to there being some other reason for the matter to proceed to trial: O 14 r 3(1) RSC.

Conclusion

[31] Helmers v Como [2014] WASC 394 [61] (Acting Master Gething).

1. The primary contention which has agitated the plaintiff's concerns, and spawned this litigation, focuses on the asserted exclusive nature of the long-term Agreement.  As I have noted, the express provisions of the Agreement support that notion of exclusivity and the defendants do not in any respect seem to suggest otherwise. 

2. However, that is not sufficient to secure summary judgment for the plaintiff on this application.  That is because, in my view, the cascading arguments advanced by the defendants and the broader matters to which I have referred above, have sufficient merit to justify the conclusion that there is an issue or question in dispute which ought to be tried, or there ought for some reason to be a trial of the claim.  I should reiterate that this is not a final assessment in any respect, merely an assessment at the level of arguability for the purposes of the present interlocutory application. 

F.     Orders

1. On my assessment, the summary judgment application should be dismissed and the defendants should have unconditional leave to defend the action.  My provisional view is that the usual, but not inviolable, costs order should be made, that is that costs should be in the cause, but I will hear from counsel in this regard.[32]

[32] NRW Contracting Pty Ltd v Cliffs Asia Pacific Iron Ore Pty Ltd [113].

ATTACHMENT A

DIAGRAM OF RELEVANT PARTIES AND AGREEMENTS

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

IHN

Associate to the Honourable Justice Lundberg

28 SEPTEMBER 2023