Re Barry Green - [1999] QSC 31

IN THE SUPREME COURT
OF QUEENSLAND
  O.S. No. 10044 of 1998
Brisbane
Before Mr Justice Muir

[Re Barry Green & Anor]

IN THE MATTER of an Application pursuant to Order 64 rule 1A of the Supreme Court Rules
and

IN THE MATTER of an agreement between Barry Green and Erica Maude Green, Harry Mackay Bolton and Valerie Glenda Bolton as Trustees for the Bolton Family Trust, Binbex Pty Ltd ACN 010 744 395 as Trustee for the Binbex Unit Trust, Trilby Holdings Pty Ltd ACN 010 014 856 as Trustee for the Trilby Holdings Trust, Taryn PJH Pty Ltd ACN 009 773 577 as Trustee for the Paul Hauritz Discretionary Trust and Barry Green and Erica Maude Green as Trustees for the Automatic Control Company Directors’ Superannuation Fund and as Trustees of the Automatic Control Company No. 2 Superannuation Fund and Automatic Control Company Pty Ltd ACN 009 073 705 and Grigor McPhee, Trevor Jeffrey, Ivan Board and Paul Hauritz
and

IN THE MATTER of an application by Barry Green and Erica Maude Green

REASONS FOR JUDGMENT - MUIR J.
Judgment delivered 26 February 1999

CATCHWORDS: CONSTRUCTION OF CONTRACTUAL TERMS - principles of contractual construction.

Counsel:Mr C.E.K. Hampson QC and Mr D.R.M. Murphy for the applicant
Mr Douglas SC for the respondent

Solicitors: M.F. Lyons & Associates for the applicants
Bowdens for the respondents

Hearing date: 27 January 1999

IN THE SUPREME COURT
OF QUEENSLAND
O.S. No. 10044 of 1998
Brisbane
Before Mr Justice Muir

[Re: Barry Green & Anor]

IN THE MATTER of an Application pursuant to Order 64 rule 1A of the Supreme Court Rules
and

IN THE MATTER of an agreement between Barry Green and Erica Maude Green, Harry Mackay Bolton and Valerie Glenda Bolton as Trustees for the Bolton Family Trust, Binbex Pty Ltd ACN 010 744 395 as Trustee for the Binbex Unit Trust, Trilby Holdings Pty Ltd ACN 010 014 856 as Trustee for the Trilby Holdings Trust, Taryn PJH Pty Ltd ACN 009 773 577 as Trustee for the Paul Hauritz Discretionary Trust and Barry Green and Erica Maude Green as Trustees for the Automatic Control Company Directors’ Superannuation Fund and as Trustees of the Automatic Control Company No. 2 Superannuation Fund and Automatic Control Company Pty Ltd ACN 009 073 705 and Grigor McPhee, Trevor Jeffrey, Ivan Board and Paul Hauritz
and

IN THE MATTER of an application by Barry Green and Erica Maude Green

REASONS FOR JUDGMENT - MUIR J.
Judgment delivered 26 February 1999

The applicants, Barry and Erica Green, entered into an undated written agreement with the respondents (“the purchasers”) under which the applicants agreed to sell to the purchasers the issued shares in the capital of Automatic Control Company Pty Ltd (“the company”) for the consideration stated in the agreement. The company was also a party to the agreement.
A dispute has arisen between the parties as to the proper construction of those parts of the agreement which determine the moneys payable by the purchasers to the applicants…

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: [1999] QSC 31
Decision Date: 26 February 1999

CaseChat Overview and Summary

In the matter of an application for declaratory relief concerning an agreement between Barry Green, Erica Maude Green and others, the Supreme Court of Queensland addressed a dispute regarding the interpretation of certain clauses that determined the payment obligations of the purchasers to the applicants. The applicants, Barry and Erica Green, contended that the clauses in question, which provided for reductions in the payments due to them if the company's profits fell below a specified threshold, did not affect the amount payable on completion of the sale. They argued that such reductions were to be made only in respect of sums payable in specified years and that Clause 12 did not provide for a permanent reduction of the purchase price. Conversely, the respondents argued that Clause 12 applied to payments due on completion, and that the applicants' rights to the entitlements were qualified by the operation of Part 5 of the agreement. The Court considered the objective intent of Clause 12 and found that while there was tension between the clauses, all provisions of the agreement could be given effect if Clauses 12.1 and 12.2 were treated as having a general overriding or qualifying operation. The Court ruled that the moneys payable on completion could be varied by operation of Clauses 12.1 and 12.2, and that Clause 11.2 did not prevent the applicants from claiming or recovering any part of the Shareholder Entitlements or Employee Entitlements which may become payable after the completion date by operation of Clauses 12.1 and 12.2 of the agreement.

The Court proposed to make the following declarations, unless the parties wished to make further submissions on the form of declaratory relief: (a) the moneys payable on the completion date in respect of Employee Entitlements and Shareholder Entitlements may be varied by operation of clauses 12.1 and 12.2; and (b) clause 11.2 of that agreement does not operate to prevent the applicants from claiming or recovering after the completing date any part of the Shareholder Entitlements or the Employee Entitlements which may become payable after the completion date by operation of clauses 12.1 and 12.2 of the said agreement. The Court will hear submissions on costs.

Orders