Re Sparkling Beverages Pty Ltd (No 2)

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

COMMERCIAL LIST

S ECI 2021 02630

IN THE MATTER OF SPARKLING BEVERAGES PTY LTD (ACN 140 635 347)
AND JET CO (AUST) PTY LTD (ACN 139 724 235)

STEVEN JAMES (and another according to the Schedule)	Plaintiffs
v
MATTHEW LINAS TENDER (and others according to the Schedule)	Defendants

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JUDGE:	Connock J
WHERE HELD:	Melbourne
DATE OF HEARING:	11 & 12 July 2023
DATE OF JUDGMENT:	24 July 2023
CASE MAY BE CITED AS:	Re Sparkling Beverages Pty Ltd (No 2)
MEDIUM NEUTRAL CITATION:	[2023] VSC 419

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CONTRACTS — Authority to bind — Solicitor’s authority to compromise litigation —Binding agreement — Agency — Actual authority — Implied authority — Ostensible authority — Authority of solicitors — Offer and acceptance — Counter-offer or enquiry — Construction of alleged counter-offer document — Characterisation of communications — General principles regarding formation of contracts — Masters v Cameron (1954) 91 CLR 353 — Surrounding circumstances — Objective intention — Intention to be immediately bound — Whether exchange of emails created a binding settlement agreement — No binding agreement.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr A Ounapuu	Baker McKenzie
For the Defendants	Mr T Gorton	Bastian Hancock Stynes

TABLE OF CONTENTS:

Introduction and summary.............................................................................................................. 1

Evidence.............................................................................................................................................. 3

Witnesses........................................................................................................................................... 23

..... Mr Hancock................................................................................................................................. 24

..... Mr Kaintatsis............................................................................................................................... 25

Submissions...................................................................................................................................... 29

Defendants’ submissions........................................................................................................... 29

..... Plaintiffs’ submissions............................................................................................................... 36

Some factual matters....................................................................................................................... 42

Principles and observations.......................................................................................................... 45

Offer and acceptance.................................................................................................................. 46

..... Intention to make an immediately binding agreement........................................................ 50

..... Actual and ostensible authority of solicitors.......................................................................... 56

Agreed list of issues........................................................................................................................ 61

Consideration and disposition..................................................................................................... 62

Authority of Mr Kaintatsis to enter into the alleged Release Agreement on behalf of the plaintiffs.............................................................................................................................................. 62
Did the parties enter into a binding settlement agreement?................................................ 67
Did the alleged Release Agreement contain the terms referred to in the Terms Questions? 82
By virtue of the alleged Release Agreement did the plaintiffs release the defendants from the substantive claims made in the proceeding such that the proceeding against the defendants ought to be dismissed?..................................................................................................... 82

Other matters.................................................................................................................................... 82

Conclusion and proposed orders.................................................................................................. 84

SCHEDULE OF PARTIES.............................................................................................................. 85

HIS HONOUR:

Introduction and summary

In this proceeding the plaintiffs seek a broad range of relief based upon alleged oppressive conduct of the first and second defendants in connection with business dealings and relevant shareholdings in the third and fourth defendants. For present purposes the details of the oppression related allegations made in the claim and the defences raised in response need not be addressed.

In paragraph 35A of the defendants’ further amended defence (Amended Defence) it is alleged that a settlement agreement was reached between the parties on 8 December 2022 pursuant to which the parties agreed that the claims made by the plaintiffs against the defendants would be dismissed by consent with no order as to costs, with the plaintiffs and the defendants agreeing to mutual release terms as referred to in paragraph 4(b)(ii) and (iii) below (Mutual Release Terms).

On 17 May 2023, I ordered that separate questions be tried before the trial of the other issues in the proceeding pursuant to r 47.04 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (Rules).[1] The trial of the separate questions concluded on 12 July 2023 and these reasons contain and address my determination of those questions.
[1]See Re Sparkling Beverages Pty Ltd [2023] VSC 258.

The separate questions for determination (Questions) were as follows:

(a) Did the parties to the proceeding enter into a legally binding settlement agreement as alleged in paragraph 35A of the defendants’ further amended defence (Release Agreement) filed on 24 May 2023 (Agreement Question)

(b) If the answer to the question referred to in sub-paragraph (a) is yes, were there terms of the Release Agreement as follows:

(i) The plaintiffs and defendants consented to the proceeding being dismissed with no order as to costs;

(ii) In consideration for the Defendant Parties’ consent to the proceeding being dismissed with no order as to costs, the Plaintiff Parties hereby release and forever discharge the Defendant Parties in respect of the claims made in proceeding S ECI 2021 02630 (‘Proceeding’) and any other claim whatsoever that the Plaintiff Parties have against the Defendant Parties arising from, incidental to or in connection with any matter raised in the Proceeding and the statement of claim filed therein, and the Plaintiff Parties acknowledge that this release may be relied upon by the Defendant Parties as a complete defence to any action, suit or proceeding commenced, continued or taken by the Plaintiff Parties in connection with any matter the subject of this release; and

(iii) The Defendant Parties hereby release and forever discharge the Plaintiff Parties in respect of the claims made in the Proceeding and any other claim whatsoever that the Defendant Parties may have against the Plaintiff Parties arising from, incidental to, or in connection with any matter raised in the Proceeding and the statement of claim filed therein, and the Defendant Parties acknowledge that this release may be relied upon by the Plaintiff Parties as a complete defence to any action, suit or proceeding commenced, continued or taken by the Defendant Parties in connection with any matter the subject of this release?

(Terms Questions).

As ultimately pressed at the trial, the Release Agreement was said to comprise three email communications between the defendants’ solicitor, Mr Hancock, and the plaintiffs’ then solicitor, Mr Kaintatsis, in the lead up to a directions hearing in this proceeding before Button J on 9 December 2022 (Directions Hearing). The three emails (Three Emails) were:

(a) an email sent by Mr Hancock to Mr Kaintatsis at 12:40pm on 7 December 2022 (Hancock Offer Email);

(b) an email sent by Mr Kaintatsis to Mr Hancock at 7:22pm on 7 December 2022 in response to the Hancock Offer Email (Kaintatsis Response Email); and

(c) an email sent by Mr Hancock to Mr Kaintatsis at 11:11am on 8 December 2022 in response to the Kaintatsis Response Email (Hancock Response Email).

For the reasons that follow I have concluded that the plaintiffs and the defendants did not enter into the alleged Release Agreement. It follows that the answer to the Agreement Question is ‘no’.

Given the answer to the Agreement Question, it is not necessary to answer the Terms Questions. That said, had I concluded that the parties had entered into the Release Agreement I would have concluded that there were terms of the Release Agreement to the effect referred to in the Terms Questions, which became common ground between the parties in any event.

Evidence

The evidence comprised email communications exchanged between the solicitors for the parties, email communications between the solicitors and the chambers of Button J (Button Chambers), and the oral evidence of Mr Hancock and Mr Kaintatsis,[2] each of whom was cross-examined.
[2]Who was subpoenaed to give evidence by the plaintiffs.

The communications leading up to the Directions Hearing were addressed by the parties and are dealt with below in largely chronological order.

At 10:00am on 30 November 2022, Button Chambers sent an email to the parties confirming that the proceeding was listed for a directions hearing on 9 December 2022 and requesting that, among other things, the parties confer for the purpose of negotiating orders and providing consent or other proposed orders to the court by 6 December 2022.[3]
[3]The email referred to 9 November 2022 rather than 9 December 2022, which was an obvious error that was clarified by a later email from Button Chambers.

At 10:21am on 30 November 2022, Mr Kaintatsis sent an email to the first plaintiff, Mr James, forwarding the Button Chambers’ email. The body of the email was in the following terms:

Hi Steve,
We have received below the email from the Supreme Court regarding the directions hearing.
I note your instructions on Friday of last week that you wanted to speak to Kevin about whether to discontinue the proceeding.
Can you please advise.

At 12:31pm on 30 November 2022, Mr Kaintatsis sent a further email to Mr James, copied to Ms James, who is the sole director of the second plaintiff,[4] in the following terms:

Hi Steve,
I refer to our telephone discussion earlier in which you instructed to discontinue the proceeding.
In light of your instructions, I prepared minutes of consent orders to present to the defendants’ solicitors. You will note that item 2 of the minutes of consent orders provide that there is no order as to costs. In other words, each party will bear its own costs.
Can you please confirm that you are happy for me to proceed.

[4]And who is separated but not divorced from her husband, Mr James.

At 10:11am on 1 December 2022, Mr Hancock and Mr Kaintatsis had a telephone conversation (1 December Call). Mr Hancock said that he could recall the telephone conversation and that in advance of it he had been informed by his client that a proposed purchaser of the business and company the subject of the proceeding, Mr Kevin Nicol, had indicated that the sale would not be proceeding. Mr Hancock said that during the 1 December Call Mr Kaintatsis had said to him that because the business sale was fairly well advanced, he was seeking a discontinuance of the proceeding with each party to bear its own costs. Mr Hancock was surprised by this given his information about the sale not being likely to proceed[5] and he informed Mr Kaintatsis that he understood that the sale was not going ahead.
[5]Although Mr Hancock was not acting in relation to the sale.

Mr Hancock said Mr Kaintatsis was surprised by this information and said that he would need to confirm his instructions in relation to the proposed discontinuance of the proceeding. Mr Hancock said there was some discussion about why the defendants should agree to no order for costs being made, although the detail of that part of the discussion was not addressed in the oral evidence. Mr Hancock also said that there was not any discussion of releases in the 1 December Call. The file note that Mr Hancock made of the 1 December Call is referred to below.

Although Mr Kaintatsis remembered the telephone conversation, his memory did not appear to be as crisp as that of Mr Hancock, although in part this was also due to Mr Kaintatsis being a little less directly articulate than Mr Hancock, which is not a criticism of Mr Kaintatsis. Mr Kaintatsis also volunteered in examination in chief that at times he had difficulty remembering the precise sequence of what happened when. During cross-examination he acknowledged this aspect of his recollection freely, and the totality of his evidence on this topic revealed that his emphasis was more on the timing and sequence of matters rather than the content of conversations, or who he was having the conversations with. That said, he also acknowledged that he had some difficulty recalling what the content of some conversations was in parts, but not in every case. Mr Kaintatsis volunteered in his evidence that he had kept file notes and that they could clarify things. The file notes were not in evidence and during cross-examination he was asked whether his file notes had been transferred to the plaintiffs’ now solicitors when the file was transferred, to which he answered ‘no’. Neither counsel followed up on this aspect, or asked for production. It also appeared that the file notes had not been the subject of any subpoena or notice to produce by either party.[6]
[6]No submission was made regarding Jones v Dunkel in this or any other context.

As to the 1 December Call, Mr Kaintatsis recalled contacting Mr Hancock and having a discussion with him, which he said subsequently became a without prejudice discussion.[7] He said that he was doing his best to recall the discussion and that his instructions were to discontinue the proceeding, and he queried whether Mr Hancock’s clients would be open to that. He said that the discussion continued and that Mr Hancock mentioned that he thought his clients would be open to that. He said Mr Hancock said that the parties had cooled off somewhat with the litigation and that he put to Mr Kaintatsis that perhaps the parties might be open to a mediation or informal mediation outside of the court with the lawyers, to which Mr Kaintatsis raised the prospect of a neutral or third party mediator. Mr Kaintatsis said that this occurred in a context where his understanding was that the negotiations in relation to the sale of the business had advanced and his clients were confident that the sale would proceed and were therefore prepared to discontinue the proceeding. When Mr Kaintatsis became aware that this understanding did not accord with Mr Hancock’s understanding regarding the sale, he said that the conversation ended on the basis that he was going to have to seek further instructions from his clients and get back to Mr Hancock.
[7]Counsel for each of the parties confirmed that no objections were taken to any of the evidence given the nature of the Questions, including any evidence regarding without prejudice communications.

The body of Mr Hancock’s handwritten file note of that conversation was in the following terms (1 December File Note):[8]

• Matter back on for directions next Friday — his instructions are that a sale is not far away & his clients are prepared to discontinue w/ each party bear their own costs.
• Adv Stase — not my impression re sale — Kevin Nichol email to Scott & Steve that sale not proceeding at this time. Stase not aware of this — will need to confirm.
• Put to Stase why he says o/c should agree to ebo — he says his clt forced to issue, has good prospects & has incurred costs.
• Stase to confirm clts’ instructions re the sale & revert back to me if his instructions remain to seek a discontinuance & ebo.
14 MINS.
[8]Court Book 94.

At 5:54pm on 5 December 2022, Mr Kaintatsis sent a further email to Mr James in the following terms:

Hi Steve,
I refer to our telephone discussions on Thursday last week. As we have a deadline with the Court tomorrow, can you please let us know how you would like to proceed with this matter.

At 7:25am on 6 December 2022, Mr James sent an email to Mr Kaintatsis (copied to Ms James) in the following terms:

Morning Stase
My instructions are to stop the legal proceeding. Each party to pay their own legal fees.
Best regards …

At 8:43am on 6 December 2022, Mr Kaintatsis responded to Mr James by email (copied to Ms James) saying, ‘Thank you Steve, I acknowledge your instructions.’ Ms James responded to the email at 4:15pm on 7 December 2022 in the following terms:

Hi Stase,
I am laying low …  if you haven’t noticed.
I hope you are keeping well. Have a gorgeous Christmas with your partner and family.
Sending you lots of Chrissy cheers [emoji tree] [emoji Santa Claus]

At 8:55am on 6 December 2022, Mr Kaintatsis sent an email to Mr Hancock, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Good morning Jonathan,
I refer to the correspondence below from the Associate to the Honourable Justice Button and to our without prejudice telephone discussion last week.
I confirm my instructions to discontinue the proceeding on the basis that each of the parties is to bear their own costs and attach minutes of consent for your consideration.
Subject to your instructions, could you please provide me with a signed copy of the minutes as soon as possible so that we can file with the Court.

During his oral evidence Mr Kaintatsis referred to having had a few conversations around this time with Mr James, at which time his instructions were to ‘get rid of’ the proceeding with no order as to costs. It was apparent from Mr Kaintatsis’ evidence, and common ground, that in various communications he referred to the proceeding being ‘discontinued’ when what he had proposed in the orders, and what he had in mind, was that the proceeding be dismissed. Mr Kaintatsis said that he understood the difference, and that why he was proposing orders that saw the proceeding dismissed was because he understood this was more final than discontinuance and Mr James had no desire to be continuing with the proceeding, but just wanted to get rid of it with no order as to costs.

At 9:33am on 6 December 2022, Mr Hancock sent an email reply to Mr Kaintatsis, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Good morning Stase,
We hold instructions to consent to orders discontinuing the proceeding with no order as to costs (i.e. each party is to bear their own costs) on the proviso that your clients provide a release in respect of the claims made in the proceeding. If that is acceptable, we will prepare a short deed of settlement and release.

At 10:02am on 6 December 2022, Mr Kaintatsis sent an email reply to Mr Hancock, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:[9]

Hi Jonathan
Please provide this and I will obtain instructions.

[9]It was common ground, and apparent in any event, that the ‘this’ referred to in the email was the draft deed of release to be prepared by Mr Hancock.

At 10:18am on 6 December 2022, Mr Hancock sent an email reply to Mr Kaintatsis, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Hi Stase,
I’m not going to prepare the deed of release without confirmation that your clients are prepared to provide a release.

Kindly obtain instructions and revert as soon as possible.

At 2:19pm on 6 December 2022, Mr Kaintatsis sent an email reply to Mr Hancock, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Hi Jonathan,
My instructions are that my clients are prepared to provide the release, subject to mutually acceptable terms.
Please provide us with your deed for our consideration.

At 4:12pm on 6 December 2022, Mr Kaintatsis sent an email to Button Chambers, copying Mr Stynes, Mr Hancock, Ms Rizzo-Babet and Mr Israeli, which stated:

Dear Associate,
We refer to the above proceeding and to your email below.
Please accept our apologies for the delay in responding.
Whilst the matter between the parties has not been resolved, our clients have instructed us to discontinue the proceeding.
Minutes of consent were provided to the Defendants’ solicitors (attached), who have agreed in principle to the minutes but on the proviso that a deed of settlement and release is executed by the parties.
There was a delay in obtaining instructions from our clients but they have agreed to enter into a deed of settlement and release – subject to mutually acceptable terms.
In light of the above, our instructions are that the directions hearing listed for Friday, 9 December 2022 should be vacated.
We confirm that the solicitors for the Defendants’ have been copied to this email.

The proposed minute of order provided for the dismissal of the claim with no order as to costs.

At 5:47pm on 6 December 2022, Button Chambers sent an email to Mr Kaintatsis and Mr Hancock acknowledging receipt of Mr Kaintatsis’ email and requesting that the parties indicate by reply email whether they agree to the directions hearing being vacated and, if so, requesting proposed consent orders signed by all parties.

At 5:51pm on 6 December 2022, Mr Hancock sent an email to Button Chambers, among others, informing them that the defendants consent to the directions hearing being vacated.

At 10:33am on 7 December 2022, Mr Kaintatsis sent an email to Mr Hancock, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Hi Jonathan,
We refer to the correspondence below from the Associate.
Please find attached our proposed minutes of consent for your consideration. If the minutes are acceptable, please provide us with a signed copy by 12:00 pm today so that the minutes can be filed with Court.

The attached proposed minutes of consent orders provided for the proceeding to be dismissed with no order as to costs.

At 10:45am on 7 December 2022, Mr Hancock sent an email reply to Mr Kaintatsis, copying Mr Stynes, Ms Rizzo-Babet and Mr Israeli, which stated:

Hi Stase,
I’m presently in Court (virtual appearance) waiting for my matter to be called. I’ll attend to this as soon as possible.

At 11:55am on 7 December 2022, Button Chambers sent an email to the parties requesting that the defendants indicate by reply email whether they consent to the plaintiffs’ proposed orders and, if so, to sign them. The proposed orders were the orders of the plaintiffs previously sent seeking to have the proceeding dismissed with no order as to costs.

At 11:59am on 7 December 2022, Mr Hancock and Mr Kaintatsis had a telephone conversation (7 December Call). Mr Hancock said that he could recall that conversation. Mr Hancock said that during the 7 December Call:

(a) He apologised because he had not had the chance to prepare the proposed deed of settlement.

(b) He referred to the proposed minute of consent orders and sought to clarify whether it was a discontinuance or a dismissal being sought by the plaintiffs. Mr Hancock said that a dismissal would be more permanent and would be his clients’ preference.[10] Mr Hancock said Mr Kaintatsis said that he understood the distinction.
[10]Mr Kaintatsis did not recall this aspect, but did recall discontinuance and dismissal being discussed.

(c) Mr Kaintatsis expressed concern about not delaying in getting back to the court in response to the email from Button Chambers.

(d) Mr Hancock said that he would not be prepared to sign the proposed minute dismissing the proceeding without having a form of the release and asked whether Mr Kaintatsis would adjourn the hearing so that the deed of release could be prepared. Mr Hancock said that Mr Kaintatsis said that his clients were not prepared to further adjourn the matter and that it must be dismissed at the Directions Hearing.

(e) Mr Hancock said that in circumstances where the plaintiffs were not prepared to further adjourn the directions hearing the parties could agree to the form of a release by way of an exchange of emails and that if that was agreed then the minute of consent order could be signed. Mr Hancock said that he said to Mr Kaintatsis that if emails were exchanged regarding the form of the release then that would be binding until such time as it was superseded by the executed deed of release. He said that Mr Kaintatsis then ‘approved of that approach’. When asked what Mr Kaintatsis had actually said, Mr Hancock said he said ‘… Yes, will proceed in that manner – I – believe he’d said’.[11]

(f) Mr Kaintatsis did not say anything about requiring instructions from his client before the exchange of emails.

[11]Transcript 50:18–20.

Mr Kaintatsis gave evidence in chief regarding this telephone conversation and was cross-examined at some length about it. During his evidence I observed him closely and noted that he was listening and seeking to do his best to answer questions asked of him honestly and responsively, even when it was not always clear whether something was a question, or when parts of a question required clarification.[12] Much of what was recalled about the conversation was consistent with the account given by Mr Hancock and Mr Hancock’s file note. This included, for example: Mr Hancock’s apology about not being able to have time to prepare the deed of release; Mr Hancock being anxious about the proceeding being dismissed with no order as to costs without there being some form of release; discussion about the difference between dismissal and discontinuance; the deed of release not having been prepared; the plaintiffs wanting the proceeding dismissed at the Directions Hearing; that some form of release was to be sent to Mr Kaintatsis for his consideration, which Mr Kaintatsis agreed to receive and have a look at; and that Mr Kaintatsis had said no to the proposed short adjournment to enable the deed to be prepared.
[12]This is an observation about Mr Kaintatsis and is not intended to convey a criticism of cross-examining counsel.

When giving evidence about the 7 December Call, Mr Kaintatsis also said it was not clear to him what was being proposed at the time. Having not received the deed of release he said he did not really understand what Mr Hancock had in mind and what he was proposing to send to him. He said he was very busy at the time and did not have a lot of time to discuss it, but agreed to consider whatever was sent ‘… but I didn’t actually agree to anything more. I mean at, at this point, I mean it looked to me like the goalposts had changed and, you know, he was talking about a, um, some form of, um, some obscure form of release when, you know in my mind I’m, you know requiring, ah, expecting a, a deed of settlement.’[13]
[13]Transcript 81:24–29.

When cross-examined about the 7 December Call, it was apparent that Mr Kaintatsis was doing his best to answer the questions responsively, even though he did not do so as crisply as Mr Hancock — which I observed more to be a dispositional aspect of Mr Kaintatsis and not something raising any concern regarding his credit. In so doing, he readily conceded or agreed about various matters being said by Mr Hancock and with respect to some other matters openly stated where he was not able to recall particular matters. Mr Kaintatsis did not agree that the only issue in contention at that point between the parties for settlement was the form of the release to be granted by the defendants. He did not recall that being said. He said that he did agree that at the time of the conversation the parties had agreed that the proceeding would be dismissed with no order as to costs and that a release would be given to the defendants. However, he denied that there were no other matters that needed to be agreed and stated in response to the proposition that nothing else needed to be agreed, ‘Save for a – a deed of settlement’. In response to the question as to whether the deed would have only contained the terms of the release and the proceeding being dismissed with no order as to costs, he stated as follows:

It would’ve contained them, but it wouldn’t have contained solely those terms. It would’ve contained non-disparagement clauses, it would’ve contained um, confidentiality clauses.[14]

[14]Transcript 113:11–17.

When asked in cross-examination whether Mr Hancock made the suggestion that the parties agree the form of the release by an exchange of emails, Mr Kaintatsis said that he did not accept that and that that was not what he had agreed to in the conversation. He later said that he did not recall Mr Hancock saying that, but acknowledged that he may have and said that he did not recall it. As I observed Mr Kaintatsis give this evidence, he appeared to me to be a little confused about what was being put to him, and was seeking in part to make clear that no substantive agreement was reached in the 7 December Call, although he said he was willing to receive the proposed form of release from Mr Hancock and consider it.

The body of Mr Hancock’s handwritten file note of the 7 December Call was in the following terms (7 December File Note):

• Sorry — could not get back to him sooner. Had not had chance to prepare DoR yet due to matter in court this morn
• Noted email & minute of consent this morn was to dismiss, not disc. Explained difference. sd our pref is to dismiss — appropriate in circumstances where DoR to be provided.
• Stase concerned we need to get back to the court ASAP w/ orders. sd o/c not prepared to disc or dismiss w/o DoR & suggested short adj to finalise.
• Stase sd his clts not prepared to adj — he is instructed that proceeding must be dismissed on Friday.
• I suggested that since only the wording of the release remains in issue, we could agree by exchange of emails which would then be incorp into DoR. If agreed, o/c will provide consent to proceeding being dismissed. Stase approved of this approach.
• Left open possibility for sale/purchase of shares in new year — suggested that negotiations are between lawyers.

At 12:40pm on 7 December 2022, Mr Hancock sent an email to Mr Kaintatsis, copying Mr Stynes and Mr Israeli, which stated:

Hi Stase,
We refer to your email below, proposed minute of orders (attached), your without prejudice email of 6 December 2022 at 2.19pm and our telephone conversation at 11.59am today.
We confirm that our clients, Matthew Linas Tender, Scott William Edgley, Sparkling Beverages Pty Ltd and Jet Co (Aust) Pty Ltd (collectively, the “Defendant Parties”) will consent to the proceeding being dismissed with no order as to costs, as per the attached proposed orders, on the basis that your clients, James Estate Pty Ltd and Steven James (collectively, the “Plaintiff Parties”) will release the Defendant Parties as follows:
“In consideration for the Defendant Parties’ consent to the proceeding being dismissed with no order as to costs, the Plaintiff Parties hereby release and forever discharge the Defendant Parties in respect of the claims made in proceeding S ECI 2021 02630 (“Proceeding”) and any other claim whatsoever that the Plaintiff Parties have against the Defendant Parties arising from, incidental to or in connection with any matter raised in the Proceeding and the statement of claim filed therein, and the Plaintiff Parties acknowledge that this release may be relied upon by the Defendant Parties as a as a complete defence to any action, suit or proceeding commenced, continued or taken by the Plaintiff Parties in connection with any matter the subject of this release.”

It is our expectation that the parties will enter into terms of settlement (which we have offered to prepare, and will provide as soon as practicable), and that the terms of settlement will include the above release. Until such time as those terms of settlement are executed by both parties ad exchanged, the Defendant Parties may rely on this email and the terms of the release herein, and your confirmation that the Plaintiff Parties agree to provide this release.
Please confirm that the release is satisfactory to the Plaintiff Parties, and upon that confirmation, we will sign and return the proposed minute of order.

At 1:44pm on 7 December 2022, Mr Kaintatsis forwarded Mr Hancock’s email to Mr James and Ms James under cover of an email in the following terms:

Dear Steve and Marg,
We refer to the above proceeding.
Steve as per our telephone discussions yesterday, the defendants’ solicitors will agree to our proposed orders to discontinue the proceeding and that each party bears its own costs (attached) on the proviso that the plaintiffs release them from any further claims made in relation to the proceeding and statement of claim.
Please refer to the email below from Jonathan regarding the release below. Their concern is that they will be agreeing to a discontinuance of the proceeding without any protection in the way of a release.
Marg and Steve, can you each confirm your consent to the release below and to the release being incorporated in the final terms of settlement/release (subject to mutually acceptable terms of settlement/release).
Please note that by agreeing to the release below, you will not be able to issue a new proceeding in the future in relation to this matter.

The email to Mr and Ms James also attached a proposed minute of consent order providing for the proceeding to be dismissed with no order as to costs.

A little after 7:00pm on 7 December 2022, Mr Kaintatsis spoke with Mr James by telephone. Mr Kaintatsis said Mr James instructed him that he wanted to seek a mutual release. Mr Kaintatsis said that because at that stage things had changed so that suddenly it was proposed that a ‘release in the form of a um, a paragraph’[15] was being proposed, he was concerned that a deed of release may not be forthcoming and there would then be a release that would be provided to the defendants but not a reciprocal release of the plaintiffs. He said he conveyed that to Mr James and sought and obtained instructions about seeking a mutual release. It was subsequent to this telephone conversation that the 7:22pm Kaintatsis Response Email was sent.
[15]Transcript 85:25.

The transcript of Mr Kaintatsis’ evidence is in the following terms:
I do recall there was a – I received instructions um, from Mr – it was at about – it was that evening about 7 – it was after 7 that um, that evening I had a telephone discussion with um, Mr um, James and who had instructed me to seek a – a mutual release. Now, my concern – well, also I mentioned that um, the – my concern here was given that – we were talking in the first instance um, with Mr Hancock um, about a um, a short deed of release being prepared and then suddenly we’ve – we’ve come into this um, a release in the form of a um, a paragraph. I was concerned that a deed of release may not be forthcoming and that there would be a – a release that would be provided to the defendants, but um, not a – a reciprocal release to my clients. So, um, I conveyed that, and I sought instructions as to um, and obtained instructions about seeking um, seeking a – a mutual release. I mean this was quite um, unusual because I mean there was just – it was a one-sided release. I – you know, normally if we’re talking about a um, some sort of a um, a deed of settlement or release, there’s a, you know, there’s a reciprocal release and this was – I didn’t really understand um, what was going on here. Um, yeah.
Could the witness please be shown court book p115 which is 120 of the PDF?
HIS HONOUR: And again, just take your time to read the entirety of that email?---Yes.
MR OUNAPUU: This email was sent at 7.22 pm, was it before or after the telephone call that you were referring to? ---Ah, it was after. I – I had – I – I had prepared a draft um, and um, but it was um, after I obtained instructions.[16]
[16]Transcript 85:15–86:15.

At 7:22pm on 7 December 2022, Mr Kaintatsis sent the Kaintatsis Response Email to Mr Hancock, copying Mr Stynes and Mr Israeli, which stated:

Hi Jonathan,
We refer to your email below.
In the absence of a properly executed Deed of Release, it would be appropriate that a release also be provided by your clients to our clients.
Thus, adopting the terms and drafting in your email below, we propose that the following release be provided by your clients (the Defendant Parties) to our clients (the Plaintiff Parties):
The Defendant Parties hereby release and forever discharge the Plaintiff Parties in respect of the claims made in the Proceeding and any other claim whatsoever that the Defendant Parties may have against the Plaintiff Parties arising from, incidental to, or in connection with any matter raised in the Proceeding and the statement of claim filed therein, and the Defendant Parties acknowledge that this release may be relied upon by the Plaintiff Parties as a complete defence to any action, suit or proceeding commenced, continued or taken by the Defendant Parties in connection with any matter the subject of this release.”
Please confirm that the Defendant Parties will provide the above release to the Plaintiff Parties, which will also be included in the terms of a Deed of Release.
This email and the above release will be relied upon by the Plaintiff Parties.

At 11:11am on 8 December 2022, Mr Hancock sent the Hancock Response Email to Mr Kaintatsis, copying Mr Stynes and Mr Israeli, which stated:

Good morning Stase,
Our instructions are to accept the mutual releases, in the terms outlined in our email exchanges below, to be incorporated into a deed of release in due course.
We attach the signed minute of consent, dismissing the proceeding with no order as to costs.

The minute of consent order signed by the solicitors for the defendants provided for the proceeding to be dismissed with no order as to costs.

At 11:23am, Mr Kaintatsis sent an email to Mr James and Ms James forwarding Mr Hancock’s email to them. Mr Kaintatsis’ email was in the following terms:

Good morning Steve and Marg,
For your information, the Defendants have provided you with a release — please see below.
Can you please let us have your instructions. Marg, as you are the Director of the Second Plaintiff, I will also need your instructions.[17]

[17]During his oral evidence Mr Kaintatsis said that he recalled that the email address ‘tuscaniBeverages’ was an email address for Ms James and therefore it appeared that he had sent the email to Ms James twice — although it may be noted that earlier emails were addressed to that address and responded to by Mr James.

At 11:41am on 8 December 2022, Mr Hancock sent an email to Button Chambers, copying Mr Stynes and ‘GI Law (Plaintiff’s solicitor)’, which stated:

Dear Associate,
The parties have reached a consensus on the terms of mutual releases.
We have provided the plaintiff’s solicitors with a minute of consent to orders signed on behalf of the defendants, in the form proposed by the plaintiffs and as attached. We expect that the plaintiff’s solicitors will provide the fully signed minute as soon as they are able.

At 12:26pm on 8 December 2022, Mr Kaintatsis sent an email to Mr Hancock, copying Mr Stynes and Mr Israeli, which stated:

Hi Jonathan,
Just to be clear, my email of 7 December 2022 was not to be understood as an explicit confirmation that I held instructions to provide the release. It was merely to canvass whether your clients were open to provide a similar release in order for us to obtain instructions from our clients.

I am currently waiting on instructions from my clients.
In light of your email below to the Court, until instructions are received from my clients, I am not in a position to provide signed minutes to the Court on the basis that the parties have reached a consensus on the terms of mutual release.
To avoid any inconvenience, I will revert to you as quickly as possible with my instructions.

Mr Kaintatsis had a conversation with Ms James on 8 December 2022 (Ms James 8 December Call) in which she said to him that she wanted some further time to consider the position. Mr Kaintatsis said that this conversation occurred after he sent the email of 12:26pm on 8 December 2022 and not before it. It was submitted by counsel for the defendants that the court should conclude that it is unable to make a finding as to whether this conversation occurred after sending the email at 12:26pm or before it at some time between 11:41am and 12:26pm. This is addressed later in these reasons.

At 12:53pm on 8 December 2022, Button Chambers sent an email to Mr Hancock, copied to the parties, confirming receipt of Mr Hancock’s email of 11:41am on 8 December 2022 and informing him that the court was awaiting signed proposed consent orders.

At 1:10pm on 8 December 2022, Mr Hancock sent an email reply to Mr Kaintatsis, copying Mr Stynes and Mr Israeli, which stated as follows:

Hi Stase,
We are surprised by your email below, at 12.26pm today.
We consider that your email yesterday evening (at 7.22pm) was an offer to provide the form of release that we had proposed your clients provide to ours, on the basis that our clients would reciprocate that release. We obtained instructions on that offer and accepted it.
The meaning of your email was implicit in the fact that no objection or amendments were sought in relation to the wording of the release that we proposed (the release that your client had already agreed to provide, subject only to the wording of it). Indeed, you adopted that same wording into the form of the release that you sought for your clients from ours.
In addition, you included the following in your email yesterday evening: “this email and the above release will be relied upon by the Plaintiff Parties”, thus indicating that you considered that the offer made would be immediately binding on your clients, if accepted by ours. We see no other reason to include those words.
We suggest that you obtain the necessary instructions to ‘regularise’ your clients’ position as soon as possible. We reserve our clients’ rights, including to rely on our email exchanges as evidence of a concluded agreement containing the necessary terms.

At 2:06pm on 8 December 2022, Mr Kaintatsis sent an email reply to Mr Hancock, copying Mr Stynes and Mr Israeli, which stated:

Hi Jonathan
With respect Jonathan, you have read more into our email of 7 December 2022 (at 7:22 pm) than what was otherwise stated.
Your email of 8 December 2022 (at 1:11 pm) provided: [emphasis ours]
Please confirm that the release is satisfactory to the Plaintiff Parties, and upon that confirmation, we will sign and return the proposed minute of order.

Your instructions required an explicit language and acceptance, leaving nothing to be implied.
As noted, our email of 7 December 2022 was to canvass whether your clients were open to provide a similar release in order for us to obtain instructions from our clients.
Despite the fact that there was no “objection” to your proposed wording, and that similar wording was adopted, no explicit “confirmation” was provided to you that “the release is satisfactory” to our clients.
I have just received instructions from Margaret James, the Director of the Second Plaintiff that she will not provide the release.
In the circumstances, I have no option but to inform the Court that there has been a misunderstanding and that I cannot sign minutes of consent on the basis that the parties “have reached a consensus on the terms of mutual release”.

At 2:10pm on 7 December 2022, Mr Kaintatsis sent an email to Button Chambers, copying Mr Stynes, Mr Hancock and Mr Israeli, which stated:

Dear Associate,
Unfortunately, there has been a grave misunderstanding about the parties reaching any consensus on the terms of mutual release.
We are instructed by the Director of the Second Plaintiff that whilst she wishes to discontinue the proceeding, she will not provide a release to the Defendants.
In the circumstances, referring to Mr Hancock’s email of even date at 11:41 am, we are unable to provide the Court with signed minutes of consent on the basis that the parties “have reached a consensus on the terms of mutual release”.
Our only instructions are to sign minutes for the discontinuance of the proceeding - which are not on the basis of a consensus on the terms of mutual release.
Our apologies for this inconvenience.
We will await Her Honour’s advice on how this matter is to proceed.

At 2:26pm on 8 December 2022, Mr Hancock sent an email to Mr Kaintatsis and Button Chambers, copying Mr Stynes and Mr Israeli, which stated:

Dear Associate,
We take issue with the account provided by our colleague regarding the consensus of the release. We also note that the orders proposed by the plaintiffs were for the proceeding to be dismissed, not discontinued.
Notwithstanding the above, the defendants will agree to the proceeding being discontinued with the usual order for costs being made against the plaintiffs in accordance with rules 25.05 and 63.15 of the Supreme Court (General Civil Procedure) Rules 2015.

At 3:58pm on 8 December 2022, Button Chambers sent an email to the parties referring to the emails that had been sent to them and stating, among other things, that in view of the parties’ failure to reach a consensus, Justice Button would hear the matter for directions at 10:20am on 9 December 2022.

At 7:18pm on 8 December 2022, Mr Hancock sent an email to Mr Kaintatsis, copying Mr Stynes and Mr Israeli, which stated:

Hi Stase
We consider that your emphasis on the omission in your email of 7.22pm yesterday evening of an ‘explicit confirmation of acceptance’ purportedly in accordance with our earlier email that day (12.40pm) to be misguided.
By your email on 7 December at 7.22pm, you made a (counter) offer on behalf of your clients to our clients, which incorporated the terms of our clients’ previous offer and added to it the terms of your required release. That (counter) offer was open for acceptance on its own terms: “Please confirm that the Defendant Parties will provide the above release to the Plaintiff Parties”.
Our clients did accept the terms of your clients’ (counter) offer by our email to you this morning (11.11am) and our clients contemporaneously performed their obligations by attaching the signed minute of consent to orders for the proceeding to be dismissed with no order as to costs. It is trite that all significance to the purported requirement in our original email for some explicit confirmation of acceptance of our clients’ offer fell away when you made your clients’ (counter) offer.
For clarification, the implication referred to in our email today at 1.10pm is that your clients’ (counter) offer incorporates the terms of the release in our clients’ previous offer, which implication arises by virtue of your words “In the absence of a properly executed Deed of Release, it would be appropriate that a release also be provided by your clients to ours”, by your omission of any amendments to the wording of that release and by adopting the same wording in the terms of the release to be provided by our clients to yours. The implication is clearly not that your clients have accepted our clients’ offer.
If the object of your email was merely to ‘canvass the possibility’ of our clients providing a release to yours, as you now assert, then we would have expected you to use words to that effect, such as: “we are in the process of obtaining instructions in respect of your proposed release. In the meantime, please advise whether your clients would be willing to provide a release to our clients as follows…”. It was open to you to adopt such language, and you elected not to do so.
Instead, you opted to use language that clearly signals that that your email, and the (counter) offer it contained, was to have immediate legal effect upon acceptance; namely, that our clients are thereafter bound by the terms of that release. This is indicated by your closing paragraph “This email and the above release will be relied upon by the Plaintiff Parties”. It is telling that your email below elides entirely from any explanation of what you intended to convey by those words, after we put you on notice of the meaning that we say that they convey in our earlier email (1.10pm today).
It is our suspicion that either you did not have instructions from both of your clients to agree to provide a release when you represented that you did in your email of 6 December at 2.19pm (albeit at that time ‘subject to the wording’), or that Mrs James gave you those instructions and then changed her mind only after we had accepted your clients’ (counter) offer on behalf of our clients.
Either way, it is apparent that you are seeking to resile your clients and yourself, most disingenuously, from what was clearly a concluded consensus on how the proceeding was to be resolved, including the terms of the mutual releases that the parties were to provide (and we say have provided) to one another. If you did not have instructions to provide a release or to make the (counter) offer from both of your clients, that it is a matter between you and your clients to resolve. Our clients are entitled to rely on the authority that you purported to have to make the (counter) offer and may rely on our relevant email exchanges as evidence of the existence of a concluded agreement.
From your email to the Court this afternoon (2.10pm), it is difficult to see how any orders can be made at the directions hearing tomorrow morning, save for the discontinuance of the proceeding, with costs. Irrespective of whether that is the outcome, our clients have performed their obligations under the agreement reached this morning by providing the minute of consent that your clients required. Our clients may now rely on the release that we say your clients have provided to ours.

On the morning of 9 December 2022, Mr Kaintatsis and Mr Hancock had a telephone conversation (9 December Call) prior to the Directions Hearing. Mr Hancock said that Mr Kaintatsis asked him if he had instructions to agree to an adjournment of the Directions Hearing. Mr Hancock said he was conscious that his language in his email sent at 7:18pm on 8 December 2022 had been robust, and he wanted to clear the air. He said that he said to Mr Kaintatsis words to the effect that we are all ‘creatures of instruction’ and that he understood Mr Kaintatsis’ position. In response, he said that Mr Kaintatsis said that he appreciated Mr Hancock’s comments and that Mr Kaintatsis said that he had been quite open and honest about what has occurred and that he was ‘instructed on, no longer instructed’.[18] Mr Hancock also acknowledged in cross-examination that, notwithstanding his evidence regarding his file note taking practice, he believed it to be correct that there was no file note of the 9 December Call.
[18]Transcript 56:1–9.

Mr Kaintatsis also referred to the 9 December Call in his evidence. He said that Mr Hancock had conveyed in the call that, notwithstanding the 7:18pm email on 8 December 2022, there was no ill feeling and he understood that Mr Kaintatsis was acting on his instructions. Mr Kaintatsis also said:

What he meant, I’m not quite entirely sure. Um, I did impress upon him and I did say that, um, you know, I was being quite, um, genuine in my, um advice that, ah, I didn’t have final instructions. Then I also had, I recall, I had emailed him I think just that, prior, a, um, a minute of, um, well a timetable for, um, you know, in preparation for the, um, the directions hearing with some, um, you know, as to the next steps. Um, he hadn’t seen them at the time, um, but he said he would, um, obtain instructions.[19]

[19]Transcript 92:28–93:1–6.

I note in this context that during closing submissions counsel for the defendants stated that he did not consider the 9 December Call to be ‘… of any use to the court one way or the other let alone the absence of a file note of it’.[20] Counsel also informed the court that the defendants did not rely on any aspect of the 9 December Call and that the court would obtain ‘no useful insight from it’.[21]
[20]Transcript 195:7–16.
[21]Transcript 195:3–21.

At 9:09am on 9 December 2022 and thereafter, there were some further exchanges between Button Chambers and the parties regarding the timing of the Directions Hearing, which was moved to 12:00pm on 9 December 2022. At 9:56am on 9 December 2022, Mr Kaintatsis sent an email to Button Chambers, copied to Mr Hancock, in the following terms:

Dear Associate,
Our clients’ new instructions are to continue with the proceeding but are seeking an adjournment to March 2023. Please find attached our proposed minutes.

By email of 11:26am on 9 December 2022, Mr Kaintatsis informed Button Chambers that unfortunately counsel would not be able to attend the Directions Hearing because of an internet outage and confirmed that he would appear on behalf of the plaintiffs.

The Directions Hearing proceeded on 9 December 2022 before Button J and various timetabling and procedural orders were made. The issue between the parties regarding settlement was raised, although no procedural or other orders were made in respect of it.

On 15 December 2022, Mr Hancock sent a letter to Mr Kaintatsis (attached via email sent 4:59pm), which referred to the email correspondence on 7 and 8 December 2022. The letter stated, among other things, that:

We are instructed to seek that the question of whether that email exchange resulted in a concluded binding agreement be heard by trial of a preliminary question in the proceeding, pursuant to r 47.04 of the Supreme Court (General Civil Procedure) Rules 2015 (“Rules”). If the Court permits that to occur, and the question is answered in favour of the defendants, the proceeding will be dismissed.

The defendants’ foreshadowed application was heard and determined on 17 May 2023, and I made orders for the separate trial of the Questions the subject of these reasons.

Witnesses

As mentioned, the defendants called their solicitor, Mr Hancock, and the plaintiffs called their former solicitor, Mr Kaintatsis.[22] They each gave oral evidence in chief in person in court and were cross-examined. I was able to closely observe each of the witnesses during their evidence and I make the following observations about the evidence given by each of Mr Hancock and Mr Kaintatsis.
[22]Under subpoena.

Mr Hancock

Mr Hancock has acted for the plaintiffs since the commencement of the proceeding. Initially he did so whilst an employee of DSA Law. More recently he has continued to do so as a partner in a newly formed firm, Bastian Hancock Stynes. Mr Hancock presented as a credible witness, who was familiar with the materials and articulate. Mr Hancock was attentive and appeared to be doing his best to answer the questions asked of him. Although he did, on occasion, appear to volunteer some comments or observations that were not directly responsive to questions, this was not at all pervasive and I do not consider that this detracted from his credit in any material way — and it was not submitted otherwise. No real attack was made on Mr Hancock’s credit which, given the evidence, appeared to be an understandable position for counsel for the plaintiffs to take.[23]
[23]In the defendants’ written closing submissions they had relied in part on a claimed failure of counsel for the plaintiffs to comply with the rule in Browne v Dunn, although counsel for the defendants confirmed during oral closing submissions that these submissions were not pressed.

The main issue that arose between the parties in relation to the oral evidence was in respect of some limited aspects of the 7 December Call, and in particular, whether Mr Hancock had said that the release terms would be dealt with by email and be binding pending the preparation of a deed of settlement. As is noted later in these reasons, I accept the substance of Mr Hancock’s evidence regarding this conversation, noting also that it was largely consistent with what was in effect a contemporaneous file note made by Mr Hancock shortly after the telephone call. The evidence was largely consistent with the substance of Mr Kaintatsis’ evidence regarding the 7 December Call in any event.

I note for completeness that counsel for the plaintiffs at one stage partly sought to question whether the 7 December File Note was sufficiently contemporaneous to support the evidence of Mr Hancock, although this was ultimately not pressed in any material way when addressed in closing submissions. In my view that was an appropriate position for the plaintiffs to take given Mr Hancock’s evidence regarding his practice about making a legible file note from his rough illegible notes shortly after relevant material conversations. Given Mr Hancock’s evidence regarding his file note taking practice, which in my view was unremarkable, I am satisfied that the 7 December File Note was sufficiently contemporaneous and that it supports the substance of Mr Hancock’s evidence regarding the 7 December Call. In any event, even if the 7 December File Note is put to one side, I accept the substance of Mr Hancock’s evidence regarding the telephone conversation that he had with Mr Kaintatsis. This is discussed further later in these reasons.

There were two matters that might have raised a question about aspects of Mr Hancock’s evidence. The first was his evidence that he said to Mr Kaintatsis that if agreement was reached then an email exchange would be ‘binding’ pending execution of the deed of release. His oral evidence about this was not initially that clear, causing me to ask whether ‘binding’ was something that he said to Mr Kaintatsis, in answer to which Mr Hancock said that he did. However, although the 7 December File Note is detailed, it does not use the word or record that it was said. Mr Hancock was not challenged on the issue and I accept his evidence.

The second aspect was the absence of a file note of the telephone conversation he had with Mr Kaintatsis on the morning of 9 December 2022, which sat in some tension with the evidence regarding his file note taking practice. It was not submitted that this materially detracted from Mr Hancock’s credit and I do not think that it did. In any event, both witnesses gave evidence that the call did take place, which I accept. It is also of little moment because it occurred after the time at which the alleged Release Agreement was said to have been reached and the defendants expressly do not rely on any aspect of the conversation that took place on the 9 December Call in support of their allegation that a binding agreement was reached.

Mr Kaintatsis

Mr Kaintatsis also presented as a genuine and honest witness doing his best to listen and answer the questions asked of him responsively and to the best of his ability. Like Mr Hancock, Mr Kaintatsis did volunteer some additional matters on occasion, although I do not consider that this detracted from his general credibility in any material way. Mr Kaintatsis did not present as a witness who was seeking to be self-serving or defensive. To the extent that it was submitted otherwise by the plaintiffs, I do not accept that submission — noting also that I had the benefit of being able to observe Mr Kaintatsis closely during the entirety of his evidence.

To the extent that it was submitted that Mr Kaintatsis’ evidence regarding some challenges in remembering precisely the sequence of events, conversations or emails[24] was said to detract from his general credit, I do not accept that submission — but note also that counsel for the defendants moved back from that contention during closing submissions. In any event, in my view it is not surprising that a busy practitioner[25] may have difficulty in remembering precisely when, where, and in what sequence, particular communications occurred in the absence of being taken to relevant file notes. The fact that Mr Kaintatsis candidly spoke of such challenges is to his credit.
[24]Or aspects of their content.
[25]As Mr Kaintatsis said he was.

Insofar as it was submitted that Mr Kaintatsis’ challenges regarding his recollection of precisely when events took place in some instances meant that the court cannot be satisfied and should not accept his evidence regarding the timing of the Ms James 8 December Call, I do not accept that submission. I address this factual matter later in these reasons.

I accept the defendants’ submission that Mr Kaintatsis’ evidence was shown to be inaccurate regarding his recollection that some of his emails to the court and Mr Hancock prior to the Kaintatsis Response Email referred to ‘mutual releases’ because it was not supported, in exactly those terms, by the relevant emails. This was accepted by Mr Kaintatsis when pointed out to him in cross-examination, and I do not consider that this evidence of Mr Kaintatsis detracted from his credit in any material way. It is also to be noted that although there was no reference to ‘mutual releases’ in the previous emails, there were references in at least two emails of the need for any settlement agreement to be on ‘mutually acceptable terms’.[26]
[26]See Mr Kaintatsis’ email of 6 December 2022 (2:19pm) to Mr Hancock and his email of 6 December 2022 (4:12pm) to Button Chambers, copied to Mr Hancock.

Insofar as the defendants contended that Mr Kaintatsis’ credibility was relevantly or materially affected by his evidence to the effect that the Hancock Offer Email called for an ‘unequivocal’ response accepting the defendants’ offer in that email, I do not accept that submission. Whilst it is true that Mr Hancock’s email did not expressly use the word ‘unequivocal’ or something similar, the Hancock Offer Email requested that Mr Kaintatsis ‘confirm that the release is satisfactory to the Plaintiff Parties, and upon that confirmation, we will sign and return the proposed minutes of order’. When regard is had to the full terms of the Hancock Offer Email it is apparent — and understandable — that Mr Hancock was putting forward an offer on behalf of the defendants to Mr Kaintatsis on behalf of the plaintiffs and was seeking a clear and unequivocal response from Mr Kaintatsis that the terms of the release set out in the email were satisfactory or acceptable to the plaintiffs. As I have said, I do not consider that Mr Kaintatsis’ evidence on this topic detracted from his general credit or reliability in any relevant or material way. In my view the cross-examination on this aspect, although understandable from an advocate’s viewpoint, was more technical than substantive.

That said, and as is further addressed later in these reasons, I do accept that Mr Hancock did say to Mr Kaintatsis during the conversation that he was going to provide the proposed wording of a release to him by email and words to the effect that if agreement was reached Mr Hancock’s client would consent to the proceeding being dismissed with no order as to costs. I also accept that, although precisely what was to occur and what was to be sent to Mr Kaintatsis was not at that stage[27] clear to Mr Kaintatsis, he had conveyed to Mr Hancock in the 7 December Call that he was willing to receive a proposed form of release and consider it.
[27]That is, during the 7 December Call.

To the extent that Mr Kaintatsis disputed or did not recall Mr Hancock expressly referring to the proposed release being sent by email or an exchange of emails, I prefer the evidence of Mr Hancock, who appeared to have a stronger immediate recall of the telephone conversation, which was also supported by the 7 December File Note. It is also supported by the fact that all previous written communications between the solicitors were by email, which is hardly surprising. That said, during part of his cross-examination Mr Kaintatsis did acknowledge that it may have been said but that he did not recall it.

As to the question of whether Mr Kaintatsis ‘approved of this approach’ as recorded in the 7 December File Note, I am not satisfied that this was said in that language, although in my view nothing material turns on it, and Mr Hancock accepted as much during his evidence. The language, ‘Stase approved of this approach’ is a conclusion or characterisation of something that was said. However, I do accept that both parties were aware of the substance of what was going to occur and were content to proceed in that way. That is: a deed of release was not going to be prepared prior to the Directions Hearing; Mr Hancock was going to send to Mr Kaintatsis some form of release for him to consider; Mr Kaintatsis did not know what he was going to receive; if agreement was subsequently reached between the parties about the release terms, then consent minutes dismissing the proceeding with no order as to costs would be signed by the solicitors; and the release terms would be reflected in an exchange of correspondence by email between the solicitors for the parties pending the anticipated preparation and execution of a deed of release shortly thereafter.

The upshot regarding the credit of each of the witnesses is that Mr Hancock and Mr Kaintatsis demonstrated themselves to be credible, straightforward, genuine and honest witnesses doing their best to answer questions asked of them. To the extent that recollections differed or were mistaken on some matters, this did not detract from the general credibility position, and neither did the fact that Mr Hancock was more directly articulate in his responses than Mr Kaintatsis. It is also the case that such differences as there were in recollection were not that material, and of limited significance given the other evidence and documented communications.

Submissions

The plaintiffs and the defendants each filed written closing submissions, which were in substantially similar terms to their respective opening submissions except for revisions and adjustments to take account of the oral evidence, other matters, and refinements of the parties’ respective positions that had emerged during the course of the trial. The position of each of the parties was further refined, and the issues narrowed, during constructive exchanges with counsel for the parties during oral closing submissions.

I have considered the evidence and each of the parties’ written and oral opening and closing submissions. Although it is not necessary to set out all of the detail of those submissions, I refer below to the substance of the primary submissions made by each of the parties.

Defendants’ submissions

The defendants relied upon the run of the communications between Mr Hancock and Mr Kaintatsis and the communications with Button Chambers during the period 7–9 December 2022 inclusive[28] in support of their contention that the Release Agreement was recorded in the email exchange constituted by the Hancock Offer Email, the Kaintatsis Response Email and the Hancock Response Email.
[28]And particularly the communications up to the sending of the Hancock Response Email.

The defendants submitted that Mr Hancock had authority to enter into the Release Agreement on behalf of the defendants and that no issue was taken regarding Mr Hancock’s authority by the plaintiffs. As to the authority of Mr Kaintatsis to enter into the Release Agreement on behalf of the plaintiffs, the defendants submitted that:

(a) The principles concerning the authority granted to a solicitor to compromise litigation were uncontroversial, with reference being made to the New South Wales Court of Appeal’s decision in Cassar v New South Wales Crime Commission (Cassar).[29]
[29](2014) 87 NSWLR 683, [57]–[58] (Bathurst CJ, Beazley P and Emmett JA).

(b) With respect to the ostensible authority of Mr Kaintatsis, counsel for the defendants noted that the plaintiffs now conceded that he had ostensible authority to enter into the Release Agreement.

(c) Mr Kaintatsis also had actual authority by reason of the implied actual authority referred to in Cassar and the absence of any circumstances restricting that implied authority.

(d) Mr Kaintatsis had express actual authority, which was said to comprise Mr James’ instructions to end the proceeding with no order as to costs and to grant the release sought by the defendants. In this context reliance was placed upon Mr James’ email of 6 December 2022 (7:25am) to Mr Kaintatsis, and Mr Kaintatsis’ email of 6 December 2022 (2:19pm) sent to Mr Hancock stating that his instructions were that his clients were prepared to give the release, subject to mutually acceptable terms and requesting that Mr Hancock provide him with ‘your deed for our consideration’. During closing submissions it was also contended that the instructions received from Mr James during the telephone conversation with Mr Kaintatsis just after 7:00pm on 7 December 2022 also evidenced Mr Kaintatsis’ express actual authority.

(e) Instructions given by Mr James were instructions for both plaintiffs and that neither Mr James nor Ms James had taken issue with that practice during the relevant period, and nor did they give evidence to contradict Mr Kaintatsis at trial.

Consequently, so it was said, the court can be satisfied that Mr Kaintatsis and Mr Hancock each had the necessary authority to enter into the Release Agreement on behalf of their respective clients, although counsel for the defendants stated that it was not necessary to determine the express and implied actual authority issue given the plaintiffs’ concession regarding ostensible authority.

As to the applicable legal principles regarding offer and acceptance, when an agreement is made, and objective intention to make a binding agreement, there was no relevant controversy between the parties and these principles and other related observations are referred to later in these reasons below.[30]
[30]They were also referred to in paragraphs 49 to 60 of the defendants’ written closing, the detail of which need not be set out.

What became the central issue, and what was described by the parties as the ‘crux’ of the case, was whether the Kaintatsis Response Email was properly to be characterised as a counter-offer capable of acceptance so as to give rise to an immediately binding agreement. The defendants contended that it was, and that its acceptance immediately resulted in the formation of the Release Agreement between the parties. The defendants submitted that, having regard to all of the surrounding circumstances, and particularly those in the lead up to the exchange of the Three Emails, the objective analysis leads to the conclusion that a binding agreement was reached between the parties at 11:11am on 8 December 2022 when the Hancock Response Email was sent to Mr Kaintatsis. To the extent that Mr Kaintatsis’ subsequent correspondence on 8 December 2022 was inconsistent with that proposition it was submitted that the correspondence and its content, although relevant to the question of objective intent to be immediately bound, ought not to be given any, or any material, weight.

The defendants submitted that a number of contextual matters arising from the circumstances prior to the exchange of the Three Emails on 7 and 8 December 2022 supported the contention that the Kaintatsis Response Email was a counter-offer accepted by the defendants and that the parties objectively intended that the exchange of the Three Emails would create an immediately binding agreement. These contextual matters and circumstances were said to include the following:

(a) Prior to the email exchange the parties having reached a ‘consensus’ (although not yet a binding agreement) that the proceeding would be ended.

(b) From as early as 1 December 2022 the plaintiffs had expressed to the defendants a settled intention to bring the proceeding to an end and this position was communicated again on 6 December 2022 at 8:55am, and also communicated to the court on 6 December 2022 at 4:12pm.

(c) Prior to the alleged Release Agreement the parties had reached a consensus regarding the granting of a release, Mr Kaintatsis having written to Mr Hancock on 6 December 2022 at 2:19pm indicating that his clients were prepared to provide a release, subject to mutually acceptable terms — which was also stated to the court.

(d) Mr Kaintatsis having ‘pressed’ Mr Hancock to perform the intended agreement, notwithstanding that it had not yet been made binding, by seeking that he sign the consent orders referred to in his email of 10:33am on 7 December 2022.

(e) The 7 December Call revealing that the parties were prepared for their subsequent exchange of emails to ‘… seal a binding agreement in terms mirroring the consensus they had already reached …’.

Having regard to the above, and the content of the communications prior to the alleged Release Agreement being reached, it was submitted that the surrounding circumstances, objectively considered, supported the contention that the parties had reached a consensus regarding the dismissal of the proceeding and granting the defendants a release, and that the parties were agreed that the outstanding issue, being the form of the release, would be formalised by an exchange of emails later on 7 December 2022.

The defendants’ position was that there was no binding agreement at that stage, but a binding agreement was reached at 11:11am on 8 December 2022, which comprised and was recorded in the Hancock Offer Email, the Kaintatsis Response Email, and the Hancock Response Email. It was submitted that the Hancock Offer Email was an offer from the defendants which was met with a counter-offer of the plaintiffs through the 7:22pm Kaintatsis Response Email, which it was said was accepted by the defendants by the Hancock Response Email. The defendants contended that the objective analysis of the Three Emails, in the context of the surrounding circumstances, revealed that the parties had entered into the binding Release Agreement at the time of receipt of the Hancock Response Email by Mr Kaintatsis.

Although the Kaintatsis Response Email did not contain an express acceptance of Mr Hancock’s stated terms of the release proposed by Mr Hancock, it was submitted that acceptance of those terms was to be inferred or implied from the following:

(a) the parties having already reached a consensus that a release was to be given;

(b) Mr Kaintatsis demanding a ‘mirroring’ release in the Kaintatsis Response Email;

(c) the statement in the Kaintatsis Response Email that the email and release would be relied upon by the Plaintiff Parties;

(d) the statement in the Kaintatsis Response Email that the proposed release from the defendants, if confirmed by the defendants, would ‘also’ be included in the terms of a deed of release;

(e) the absence of any indication in the Kaintatsis Response Email that the plaintiffs did not reject the release terms proposed in the Hancock Offer Email; and

(f) the absence of any mention in the Kaintatsis Response Email of the need for Mr Kaintatsis to seek or obtain instructions.

Having regard to the above it was submitted that the counter-offer must be understood to be a counter-offer involving mutual releases and that any suggestion by the plaintiffs that the counter-offer was in respect of only a release by the defendants of the plaintiffs was ‘nonsensical’.

The defendants further submitted that, properly construed, the Kaintatsis Response Email was a counter-offer and was not an enquiry relating to the defendants’ offer or their position more generally, but was a ‘full counter-offer, capable of acceptance’ that was to give rise to an immediately binding agreement if accepted. It was said that the email was not expressed as an enquiry, and that, given the 7 December Call, it ought not to be read as an enquiry. During oral closing submissions on this topic the features emphasised by counsel for the defendants that were said to support the counter-offer contention were as follows:

(a) The Kaintatsis Response Email being in response to the Hancock Offer Email.

(b) The need to read the Kaintatsis Response Email in the light of the 7 December Call earlier the same day.

(c) The form of the release in the Kaintatsis Response Email being in an almost identical form to the release proposed by Mr Hancock in the Hancock Offer Email.

(d) The references in the Kaintatsis Response Email to the release of the plaintiffs ‘also’ being included in a deed of release, and the reference to the email being relied upon by the plaintiffs.

(e) The absence of any indication of a rejection of the terms of the release proposed by Mr Hancock in the Hancock Offer Email and the absence of any reference to the need for Mr Kaintatsis to obtain instructions.

(f) The absence of any rejection of the process proposed in the 7 December Call for concluding an agreement pending the later preparation and execution of a deed of release.

With respect to the terms of the Hancock Offer Email, counsel for the defendants submitted, on enquiry from the Bench, that what was proposed thereafter fell within the (so called) fourth category of Masters v Cameron.[31] That is to say, the parties intended to be bound immediately by the terms reflected in the Three Emails but were expecting to make a further contract in substitution for that agreement containing, by consent, the Mutual Release Terms and such other terms as were agreed (if any).[32]
[31](1954) 91 CLR 353.
[32]A description and discussion of these categories and related matters is addressed in my reasons in Rossi Recycling Pty Ltd v Buckland Valley Pty Ltd & Anor [2022] VSC 467, [129]–[132], [135], [138]–[139] (Rossi) and the authorities there cited.

The defendants submitted that there was no issue between the parties that if the Kaintatsis Response Email was a counter-offer then it was clearly accepted by the Hancock Response Email sent at 11:11am on 8 December 2022, which it was said was clear on the face of the email in any event.

With respect to the emails of Mr Kaintatsis that followed on 8 December 2022 stating that there was no agreement, the defendants contended that they should be given little, if any, weight even though it was permissible for them to be taken into account to place the emails in context and determine objective intention to be immediately bound. It was submitted that the court ought to be cautious in allowing after the fact assertions regarding the absence of an agreement to ‘recolour’ or ‘recharacterise’ the parties’ previous interactions, and that such conduct did not negate the objective contractual intention that existed at the time of the exchange of the Three Emails.

With respect to the timing of the Ms James 8 December Call, it was submitted that, given Mr Kaintatsis’ stated difficulty in remembering the sequence of some events, the court could not be satisfied that this conversation occurred after Mr Kaintatsis sent the Kaintatsis Response Email to Mr Hancock at 12:26pm on 8 December 2022. That said, counsel for the defendants properly acknowledged during closing submissions that the defendants could not, and did not, contend that there was evidence that they could rely on to establish that the call was prior to that time. Rather, the defendants’ position was that the court could not be satisfied one way or the other; that is, whether the telephone call occurred before Mr Kaintatsis sent the 12:26pm email or after that time.[33]
[33]During an extended exchange with counsel on this topic counsel also responsibly acknowledged that he could not identify for the court why this issue was material in any way.

On a different topic, counsel for the defendants informed the court during closing submissions that the defendants did not rely upon any aspect of the 9 December Call between Mr Hancock and Mr Kaintatsis before the Directions Hearing.

As to the Terms Questions, it was submitted that, if the court accepted the defendants’ contention that the parties entered into the alleged Release Agreement, then the issues posed by the Terms Questions were not controversial. This, so it was said, was because the plaintiffs accepted that if the court finds that a binding agreement was reached, it was on the terms referred to in the Terms Questions, and it was said that the plaintiffs also accepted that the release of the defendants by the plaintiffs would be a complete defence to the claims the plaintiffs make in the proceeding.

There is in my view nothing persuasive or helpful to the defendants in the defendants’ contention that Mr Kaintatsis sought to press Mr Hancock to perform what was described by counsel for the defendants as the ‘intended agreement’, notwithstanding that it had not yet been made binding, by seeking to have Mr Hancock sign consent orders referred to in his email of 10:33am on 7 December 2022. It is correct that Mr Kaintatsis forwarded the consent minutes and wanted them signed and made. However, that bears little on the question of whether the Kaintatsis Response Email constituted, upon its proper construction, a counter-offer capable of acceptance by the defendants, and little on the question of whether or not a binding agreement was reached through the exchange of the Three Emails.

Similarly, although relevant, I do not consider that the conversation in the 7 December Call materially assists the defendants’ position, even when that call is taken at its highest from the perspective of the defendants. It was apparent from the evidence about the 7 December Call that Mr Hancock was going to provide to Mr Kaintatsis a form of release and that Mr Kaintatsis was unsure what he was going to receive, what the terms would be, and what his or his clients’ view about what was to be received might be. The fact that the parties can be taken to have agreed to a process by which a binding agreement could be made by email exchange if release terms were agreed and satisfactory to the ‘Plaintiff Parties’ says little about the question of whether, properly construed, subsequent correspondence of Mr Kaintatsis (being the Kaintatsis Response Email) — that on the evidence was not contemplated at the time of the 7 December Call — constituted a counter-offer by the plaintiffs to the defendants.

Although a relatively small matter, the defendants’ submission regarding Mr Kaintatsis ‘demanding’ a mirroring release by the terms of the Kaintatsis Response Email was in my view overstated and misplaced. Neither the language nor the content of the Kaintatsis Response Email can fairly be characterised as a demand, and I note that its language in the second paragraph of the email is measured and polite, as is the case with the language that follows in the email. It is evident from the terms of the email that it is of an enquiring nature. Mr Kaintatsis politely states his view that he considers it appropriate that a release also be provided by ‘… your clients to our clients …’, sets out the terms of a proposed release, and seeks confirmation that the defendants are willing to provide such a release. No demand is made by Mr Kaintatsis in the Kaintatsis Response Email. In any event, even if the email could fairly be characterised as being ‘demanding’, that would not relevantly assist the defendants in establishing that the email, properly construed, was a counter-offer capable of acceptance by the defendants.

Contrary to the defendants’ contention, the reference in the second paragraph of the Kaintatsis Response Email, to it being appropriate that a release ‘… also be provided by your clients to our clients’, and the reference to such a release ‘also’ being included in the terms of the deed of release, does not in my view provide any material assistance to the defendants’ position. It is evident that the parties were contemplating that a deed of release would ultimately be entered into and that what is being addressed in the Kaintatsis Response Email involves the concept of mutual releases. However, and having regard to the linguistic features and other matters I have earlier referred to, this does not advance the defendants’ contention that, upon its proper construction, the Kaintatsis Response Email is to be viewed as a counter-offer, whether taken alone or in combination with any other evidence.

I also do not consider that the absence of any indication in the Kaintatsis Response Email that the plaintiffs did not reject the release terms proposed in the Hancock Offer Email provides any persuasive support to the defendants’ counter-offer contention. As I have indicated, the plaintiffs were enquiring during the course of negotiations as to whether a release would also be provided by the defendants to the plaintiffs, and this did not and does not necessarily entail the rejection (or acceptance) of the release terms proposed in the Hancock Offer Email. Having regard to the terms referred to in the Kaintatsis Response Email, and the communications which preceded it, I observe that it might be inferred that at that time there was a likelihood of agreement ultimately being reached on the releases. That, however, is a different matter and does not alter the conclusion that, upon its proper construction, the Kaintatsis Response Email is not a counter-offer. However likely it may have been at different points in time that a concluded binding agreement would be reached, in the end it did not come to fruition.

Similarly, I do not see that there is any material assistance to be gained for the defendants from the absence of any mention in the Kaintatsis Response Email of the need for Mr Kaintatsis to seek or obtain instructions. Whilst it is a relevant matter to observe, it does not alone, or in combination with any other evidence or matters, lead to a different conclusion to that which I have reached based on the other factors to which I have referred.

I have earlier addressed the defendants’ submission regarding the timing of the Ms James 8 December Call. Although I have found that the Ms James 8 December Call took place after Mr Kaintatsis sent his 12:26pm email to Mr Hancock on 8 December 2022, in my view nothing turns on this fact, which appeared ultimately to be where the defendants landed on the point, notwithstanding some earlier emphasis on it. It is also to be noted that, viewed through the lens of a reasonable person in the position of the putative offeree defendants and Mr Hancock, this circumstance would be unknown to that reasonable person and does not in my view assist the defendants in connection with their construction contentions.[133] Further, even if I had found that the call had been made before the email was sent no different result would follow.
[133]I note for completeness that the defendants appropriately eschewed any suggestion that they were contending that Mr Kaintatsis was acting fraudulently, deceitfully, or inappropriately in connection with that email and the telephone call with Ms James, and eschewed any suggestion that they were contending that the content of the email was untrue. This was a proper and responsible position for counsel to take on the evidence, and there was no evidence before the court, or allegation made, that either Mr Hancock or Mr Kaintatsis had been acting inappropriately — which is not to ignore Mr Hancock’s somewhat intemperate email sent at 7:18pm on 8 December 2022 to Mr Kaintatsis.

For completeness, I note in this context of contract formation that the defendants did not pursue an alternative contention that, even if the Kaintatsis Response Email was not, upon its proper construction, a counter-offer, the parties thereafter treated it as such and acted together as though there was a binding agreement between them. That is unsurprising. If any such contention had been made it would have inevitably failed given the conduct and communications of Mr Kaintatsis and the plaintiffs following the exchange of the Three Emails. The communications included Mr Kaintatsis’ emails to Mr Hancock at 12:26pm and 2:06pm on 8 December 2022[134] in which he had promptly made clear to Mr Hancock that he was just canvassing whether the defendants would be open to providing a release, that there was no agreement, and that he had just received instructions from Ms James that the second plaintiff would not grant a release to the defendants. The communications also included Mr Kaintatsis’ email to Button Chambers (copied to Mr Hancock) sent at 2:10pm on 8 December 2022, which referred to what Mr Kaintatsis asserted was a ‘grave misunderstanding’ of Mr Hancock ‘… about the parties reaching any consensus on the terms of mutual release’, and also noted that the second plaintiff did not agree to providing a release to the defendants.
[134]After being copied to Mr Hancock’s email to Button Chambers.

Having regard to the above and the other evidence regarding the communications between, and the conduct of, the parties after the exchange of the Three Emails, it is plain that if any alternative contention had been made by the defendants that after 8 December 2022 the parties acted as though there was an agreement in place between them,[135] on the evidence before the court that contention would have been without merit and would have failed.
[135]Notwithstanding that, upon its proper construction, the Kaintatsis Response Email was not a counter-offer.

One aspect that was raised by the parties was the last sentence of the Kaintatsis Response Email, which stated that the email and release will be relied upon by the plaintiffs. As noted earlier, it was submitted by the defendants that this was consistent with their counter-offer and binding agreement contentions. Counsel for the plaintiffs submitted otherwise, referring to it as being ambiguous, involving the need for speculation, and proffering other characterisations, including ‘parroting’ a line in Mr Hancock’s email, or being related to costs in a Calderbank sense.

I make the following further observations on this topic having regard to the run of the preceding communications and the submissions of the parties:

(a) It may be noted that there was a statement to similar effect in the Hancock Offer Email, namely ‘until such times as those terms of settlement are executed by both parties ad [sic] exchanged the Defendant Parties may rely on this email and the terms of the release herein, and your confirmation that the Plaintiff Parties agree to provide this release’. That was, of course, included in an email at a time when no agreement had been reached between the parties (as remained the position).

(b) It appears that similar but more truncated language was adopted by Mr Kaintatsis in his email, also at a time when no agreement had been reached and an enquiry is being made as part of the negotiations by Mr Kaintatsis as to whether the defendants will provide a release. Upon its proper construction, when viewed through the lens of a reasonable person in the position of the putative offeree defendants or Mr Hancock, and in the context of the surrounding circumstances, in my view Mr Kaintatsis is indicating that if agreement is ultimately reached between the parties regarding the releases then the email will be relied upon. If that is so, and although the language is not as precise as it might be, so much is unremarkable in the context in which the email was sent and it does not detract from my conclusion that the Kaintatsis Response Email is not a counter-offer. If I am wrong about that, then it is to be construed as implicitly addressing a future costs context.

(c) In any event, even if there may be other constructions, or the sentence is accepted to be ambiguous, when considered in the context of the terms of the Kaintatsis Response Email and other communications, it does not change the result. For the reasons previously stated, it is tolerably clear that the language of the Kaintatsis Response Email does not directly or indirectly convey a counter-offer capable of acceptance. A reasonable person in the position of the offeree defendants would not take the Kaintatsis Response Email to be a counter-offer capable of acceptance so as to create an immediately binding agreement if accepted. This remains so whether the email is viewed in the context of the surrounding circumstances leading up to it being sent, if those circumstances are ignored, or even if those circumstances are taken into account together with the communications and circumstances that followed the exchange of the Three Emails. The existence of the sentence in question, whether alone or in combination with any other evidence, does not affect the linguistic features and other matters I have referred to that lead me to the conclusion that the Kaintatsis Response Email does not contain a counter-offer.

With respect to the parties’ references to communications subsequent to the exchange of the Three Emails, although the defendants contended that they could be taken into account in connection with objective intention, they submitted that they should be of little or no weight. In the end both parties seemed to take a similar position about this, which counsel for the plaintiffs effectively acknowledged towards the end of his closing submissions following some constructive exchanges with the Bench.

Whilst it is accepted as a matter of principle that communications subsequent to the time of making an alleged contract can be taken into account when ascertaining objective contractual intention,[136] that in my view is different to a question of construction that is addressing whether or not a particular communication constitutes a counter-offer.[137] However, it is not necessary in the circumstances to address this issue further for two reasons. First, because if all communications and circumstances after the exchange of the Three Emails are put to one side, the position remains that, on the proper construction of the Kaintatsis Response Email, it does not constitute a counter-offer capable of acceptance. Second, if the subsequent communications are to be taken into account, they do not provide any relevant support for the defendants’ contentions — and neither was it submitted otherwise by the defendants.[138]
[136]As referred to in paragraphs 135 to 137 above and the cases there cited.
[137]By way of example, I again refer to the observations of Diplock LJ in Gibson [1979] 1 WLR 294, 297.
[138]Remembering also that no reliance was placed on the 9 December Call by either party.

As I have said, the plaintiffs submitted that the Kaintatsis Response Email was in the nature of an enquiry made during negotiations that neither accepted nor rejected the offer the subject of the Hancock Offer Email. I accept that submission. Further, even if the email contained or was to be construed as a rejection of the Hancock Offer Email offer, it would not alter the conclusion that, upon its proper construction, the Kaintatsis Response Email was an enquiry and not a counter-offer. This is because such a conclusion would not relevantly impact on the reasons I have expressed above for arriving at the conclusion that I have reached regarding the proper characterisation of the Kaintatsis Response Email.

I add for completeness that I did not find the plaintiffs’ submissions regarding the suggested parallels with the facts in Stevenson[139] and Brambles[140] to be persuasive. During opening submissions the parties rightly referred to the limited utility of suggested analogues from other cases dealing with different factual circumstances at different times between different parties. The factual circumstances in the two cases referred to were indeed different to the circumstances under consideration. Whilst I accept that the cases were each illustrations of circumstances involving the characterisation of communications, and that they may be illustrative for that purpose, they did not materially aid the plaintiffs’ position.
[139](1880) 5 QBD 346.
[140](2001) 53 NSWLR 153.

Given that the Kaintatsis Response Email was an enquiry and not a counter-offer, it is readily apparent that there was no manifestation of an objective intention of the plaintiffs, or the parties together, of an objective intention to make an immediately binding agreement. Indeed, given the central importance of the construction and characterisation issue, the issue of objective intention to make an immediately binding agreement does not arise in the same or a similar way that it has in many of the decided cases.[141]
[141]It was not submitted in the alternative by the plaintiffs that, if agreement had been reached by the exchange of the Three Emails, it would not have been immediately binding. That was unsurprising given the evidence.

As I have said, there was no counter-offer made that was capable of acceptance and the parties did not enter into the alleged Release Agreement or any other settlement agreement.

Did the alleged Release Agreement contain the terms referred to in the Terms Questions?

Given that I have determined that the parties did not enter into the alleged Release Agreement, it of course follows that there were no terms of that agreement. That said, the plaintiffs conceded that if the court determined that the parties had entered into the alleged Release Agreement, then it did contain the terms referred to in the Terms Questions. As I have said earlier, this was a proper concession for the plaintiffs to make and would have been established by the terms of the Three Emails in any event.

By virtue of the alleged Release Agreement did the plaintiffs release the defendants from the substantive claims made in the proceeding such that the proceeding against the defendants ought to be dismissed?

Again, given the primary conclusion reached above, this issue does not arise. However, the plaintiffs conceded that the release term that was in favour of the defendants would have given the defendants a complete defence to the claims made against them in the proceeding by the plaintiffs if it had been determined by the court that the parties had entered into the alleged Release Agreement. In circumstances where no other contention or claim was made or raised by the plaintiffs in response to the defendants’ alleged Release Agreement contentions, this was also an understandable position for the plaintiffs to take.[142]
[142]Noting for completeness that no alternative contention or claim was raised by the plaintiffs that, if there was a binding settlement reached between solicitors, it was liable to be set aside. See, for example, Harvey v Phillips (1956) 95 CLR 235; Sheonandan Prasad Singh v Abdul Fateh Mohammad Reza (1935) 62 Ind App 196; Broadbent v Medical Board of Queensland [2010] QCA 352; The Owners Strata Plan No 57164 v Yau (2017) 96 NSWLR 587; and Boom Parts and Repairs Pty Ltd v Allied Pinnacle NSW Pty Ltd [2023] VSC 340.

Other matters

In the above reasons I have addressed and determined the Questions taking into account how the parties ultimately pursued their positions at trial, including that the alleged Release Agreement was said to comprise the Three Emails.[143] This involved something of an unstated refinement to the particulars of the alleged Release Agreement in paragraph 35A of the Amended Defence. This is because those particulars also referred to the 1 December Call, the emails in evidence between Mr Hancock and Mr Kaintatsis on 6 and 7 December 2022, the 7 December Call, and the Hancock Response Email sent at 11:11am on 8 December 2022.
[143]And, I infer, any terms to be implied by operation of law, although these were not relevant for present purposes or addressed by the parties.

No submission was made about, or objection taken to, this refinement of the defendants’ position, noting also that the defendants and plaintiffs relied upon the communications prior to the Kaintatsis Response Email in aid of their construction and characterisation of it. So much was unsurprising.

For the avoidance of doubt, it should be noted that, even if all of the communications referred to in the particulars to paragraph 35A were assumed to be pressed as constituting the alleged Release Agreement, and notwithstanding that the defendants’ case was not ultimately pursued in that way, the conclusions reached above would remain the same for the same reasons. It is also to be noted in this context that, as was common ground between the parties, there was no settlement agreement alleged by the defendants to have been made prior to the sending of the Hancock Response Email on 8 December 2022 and no counter-offer alleged to have been made by the plaintiffs to the defendants’ other than the counter-offer said to have been contained in the Kaintatsis Response Email.

The end point is that the parties did not enter into a legally binding settlement agreement as alleged in paragraph 35A of the Amended Defence, or at all. This remains the position whether the alleged Release Agreement is alleged to have been comprised of all of the communications in the particulars to paragraph 35A of the Amended Defence, only the Three Emails, or any combination of one or more of these communications.

Finally, there was no issue between the parties as to whether the Hancock Response Email would have been a legally effective acceptance of the plaintiffs’ counter-offer if the court had determined that this is what the Kaintatsis Response Email was. That was a proper position for the parties to take and was evident from, and established by, the terms of the Hancock Response Email in any event.

Conclusion and proposed orders

The defendants have failed in their contention that they have a defence to the plaintiffs’ substantive claims in the proceeding as a result of the proceeding being resolved by the parties entering into the Release Agreement.

Subject to addressing the precise form of the orders with counsel, I propose to make orders as follows:

1.The separate question referred to in the orders of Connock J made on 25 May 2023 be answered as follows:
(a)No, the parties did not enter into a legally binding settlement agreement as alleged in paragraph 35A of the defendants’ further amended defence filed on 24 May 2023 (Amended Defence).
(b)Given the answer to the first question, it is not necessary to answer the second question regarding the terms of the alleged Release Agreement.

2.There be judgment for the plaintiffs in respect of the defendants’ defence in paragraphs 35A to 35D of the Amended Defence.

I will hear from the parties regarding costs and directions for the future conduct of the proceeding.

SCHEDULE OF PARTIES
S ECI 2021 02630

STEVEN JAMES	First Plaintiff
JAMES ESTATE PTY LTD (ACN 162 793 526)	Second Plaintiff
- and -
MATTHEW LINAS TENDER	First Defendant
SCOTT WILLIAM EDGLEY	Second Defendant
SPARKLING BEVERAGES PTY LTD (ACN 140 635 347)	Third Defendant
JET CO (AUST) PTY LTD (ACN 139 724 235)	Fourth Defendant

[2023] VSC 419

24 July 2023