S T Y (Afforestation) Pty Ltd v Atkinson - [2006] VSCA 283

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No. 3712 of 2005

S.T.Y. (AFFORESTATION) PTY LTD
S.T.Y. (AFFORESTATION) PTY LTD	Appellant
v.
ATKINSON and ANOR.	Respondents

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JUDGES:	MAXWELL, P. and NETTLE and REDLICH, JJ.A.
WHERE HELD:	MELBOURNE
DATE OF HEARING:	4 December 2006
DATE OF JUDGMENT:	4 December 2006
MEDIUM NEUTRAL CITATION:	[2006] VSCA 283

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CONTRACT – Waiver – Election – Statement of present intention not to exercise contractual right in the future – Subsequent attempt to exercise right – Whether earlier statement amounted to abandonment of right – Whether statement constituted election between inconsistent courses of conduct.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr D.B. Clough	Michael Mackinnon
For the Respondents	Mr T. North, S.C. with Mr D.J. Christie	Mills Oakley

MAXWELL, P.:

This appeal raises a short point, which may be disposed of shortly. At issue is whether a statement said to have been made by the respondents - that they had no present intention of exercising, in the future, a contractual right against the appellant (“STY”) – constituted either an irrevocable election between inconsistent rights or a waiver of that contractual right.

In my opinion, there was neither an election nor a waiver. I deal first with waiver. Waiver is the renunciation or abandonment or giving up of a right. A statement of present intention not to exercise a right in the future is none of those things. First, the very premise of the statement "I have no present intention" is the continued existence of the right. The maker of the statement is saying in effect, "Although the right will continue to exist, I do not presently intend to exercise it in the future." Secondly, a statement of present intention is just that. Unless accompanied by some other statement to the contrary, a statement of present intention carries with it – as a matter of language and logical necessity – the possibility of a later change of mind. All the maker of the statement can do is state truthfully what his or her present intention is. No one can know with certainty what his or her future actions may be.

A statement of present intention may be contrasted with a statement about future conduct, such as "I will not exercise this right at any time in the future". As Mr Clough for the appellant acknowledged, a statement in those terms might have contractual force or might give rise to a promissory estoppel, depending on the circumstances. But STY has never put its case on either of those bases, and Mr Clough properly disavowed any such argument before us.

For similar reasons, this is not a case of election between inconsistent rights. Mr Clough submitted that the inconsistency lay between a statement of present intention not to exercise a right in the future, and a subsequent attempt to exercise that right. But there is no inconsistency. The making of the future attempt to exercise the right simply reflects a later change of mind. The change of mind is not inconsistent…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2006] VSCA 283
Decision Date: 4 December 2006

CaseChat Overview and Summary

In the matter of S T Y (Afforestation) Pty Ltd v Atkinson, the dispute centred on whether the defendant had waived his right to enforce a contractual provision through a statement indicating his present intention not to exercise that right in the future. The case was heard in the Supreme Court of Victoria. The plaintiff, S T Y (Afforestation) Pty Ltd, sought to enforce a contractual term against the defendant, Atkinson, who had previously communicated that he did not intend to exercise a particular right granted to him by the contract. The defendant later attempted to enforce the same right, prompting the plaintiff to argue that the defendant's prior statement constituted a waiver.

The court was required to determine whether the defendant's statement constituted an abandonment of his contractual right, effectively waiving that right. A further issue was whether the statement constituted an election between inconsistent courses of conduct, thus precluding the defendant from subsequently enforcing the right. The court had to consider the legal principles governing waiver and election in the context of contractual rights, including the circumstances in which a statement of present intention could amount to an abandonment of a future right.

The court found that the defendant's statement did not constitute an abandonment of his contractual right. It was held that the statement did not amount to an election between inconsistent courses of conduct because it did not unequivocally exclude the possibility of the defendant later enforcing the right. The court reasoned that the statement was not sufficiently clear and unequivocal to amount to a waiver. Therefore, the defendant was not precluded from subsequently enforcing the contractual right. The court concluded that the defendant's later attempt to enforce the right was not inconsistent with his earlier statement.

As a result, the court ruled in favour of the defendant, Atkinson. The plaintiff's claim was dismissed, and the defendant was permitted to enforce the contractual right in question. The court's decision highlighted the need for clarity and unequivocal language when attempting to establish a waiver or election in the context of contractual rights.

Orders