Patton v Buchanan Borehole Collieries Pty Ltd - [1993] HCA 23

HIGH COURT OF AUSTRALIA

MASON CJ, DEANE, DAWSON, GAUDRON AND McHUGH JJ

PATTON v. BUCHANAN BOREHOLE COLLIERIES PTY. LIMITED

(1993) 178 CLR 14

21 April 1993

Practice (N.S.W.)—Statutes

Practice (NSW)—Jury—Jury discharged during trial—Trial continuing without jury—Statutory power for judge to order questions of fact to be tried without a jury—Whether power to order trial to proceed without jury—District Court Act 1973 (NSW), s. 79A. Statutes—Construction and interpretation—Remedial—Liberal interpretation—District Court Act 1973 (NSW), s. 79A.

Decisions

MASON CJ, DEANE AND DAWSON JJ. The facts and the relevant provisions are set out in the reasons for judgment prepared by Gaudron J.

2. The primary question is whether the word "tried" in s.79A of the District Court Act 1973 (N.S.W.) ("the Act") means "determined" or whether it means "heard and determined", thereby designating the entire mode of trial of the question or questions which are the subject of the order. If "tried" designates the mode of trial in the sense just stated then there is the question whether the power conferred by the section can only be exercised prospectively, that is, before the commencement of the trial. That is the view which has been taken by the New South Wales Court of Appeal in relation to s.79A and in relation to its equivalent, s.89 of the Supreme Court Act 1970 (N.S.W.), in a series of cases ((1) G and J Shopfittings and Refrigeration Pty. Ltd. (In Liq.) v. Lombard Insurance Co. (Aust.) Ltd. (1989) 16 NSWLR 363 (in relation to s.89 of the Supreme Court Act); Borg Warner Australia Ltd. v. Simmons, unreported, 15 December 1989 (also in relation to s.89, Supreme Court Act); Langford v. Turnbull, unreported, 29 May 1990; Boral Resources (N.S.W.) Pty. Ltd. v. Attard, unreported, 30 August 1990.)

3. In the context of a provision which states that an action shall be tried by a jury or without a jury, it is natural to read the provision as one that prescribes the mode of trial which includes the hearing as well as the determination of the issues in the action. So also when a provision states that the issues in an action shall be tried by a jury or without a jury. But it does not follow that the word "tried" has that meaning when it is used in a provision like s.79A which is making special provision with respect to any or all of the issues in an action.

4. In that context, the word "tried" may mean no more than "determined" ((2) That is the meaning which "tried" was held to have in s.3(1) of the Law Reform (Miscellaneous Provisions) Act 1934 (U.K.); see Gardner Steel Ltd. v. Sheffield Brothers (Profiles) Ltd. (1978) 3 All ER 399, per Stephenson LJ. at p 401; Ormrod LJ. at p 402.) In this respect, it is to be noted that the provisions of the Act use both the expressions "tried" and "determined". Section 77(1) provides that the judge "shall determine all questions of law" and s.77(2) provides that…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1993] HCA 23
Decision Date: 21 April 1993

CaseChat Overview and Summary

The High Court of Australia considered an appeal by the plaintiff, Mr. Patton, against the decision of the Full Federal Court in proceedings against the defendant, Buchanan Borehole Collieries Pty Ltd. The dispute concerned the plaintiff's entitlement to certain payments under a contract for the sale of shares.

The central legal issue before the High Court was the proper construction of clause 10(b) of the share sale agreement, which stipulated that the vendor (Mr. Patton) would be entitled to a further payment if the company's net profit after tax for the financial year ending 30 June 1985 exceeded $1,000,000. The High Court had to determine whether the profit figure to be considered was the profit as disclosed in the company's audited accounts or whether certain adjustments were permissible.

The High Court, by majority, held that the phrase "profit after tax" in clause 10(b) referred to the profit as disclosed in the company's audited accounts for the relevant financial year. The Court reasoned that the agreement did not specify any basis for adjustment or re-calculation of the profit figure, and therefore, the audited accounts were the definitive measure. The legal principle applied was that contractual terms should be given their ordinary and natural meaning, and absent clear indication to the contrary, audited accounts represent the agreed basis for financial determinations within a contract.

The appeal was dismissed.

Orders