Shilkin v Jagem Pty Ltd - [2013] WASC 113

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: SHILKIN -v- JAGEM PTY LTD [2013] WASC 113

CORAM: BEECH J

HEARD: 28 MARCH 2013

DELIVERED : 2 APRIL 2013

PUBLISHED : 4 APRIL 2013

FILE NO/S: CIV 3077 of 2012

BETWEEN: STEVEN ANDREW SHILKIN
Plaintiff
AND
JAGEM PTY LTD
Defendant

Catchwords:

Practice and procedure - Application for summary judgment - Claim for specific enforcement of contract - Whether arguable defence - Turns on own facts

Legislation:

Nil

Result:

Application dismissed

Category: B

Representation:

Counsel:

Plaintiff: Mr C Chenu
Defendant: Mr G H Lawton

Solicitors:

Plaintiff: Bennett & Co
Defendant: Lawton Lawyers

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

Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552
Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256
Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337
DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423
Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87
Fazio v Fazio [2012] WASCA 72
Koompahtoo Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115
Laurinda v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623

BEECH J: The plaintiff seeks summary judgment in his claim for specific performance of a contract he entered into with the defendant. The application was brought on urgently, and the plaintiff sought an urgent decision. On 2 April 2013 I indicated that I would dismiss the application and would publish reasons later. These are my reasons.
It is convenient to outline the plaintiff's pleaded case, before turning to the evidence.

The plaintiff's statement of claim

The plaintiff's statement of claim pleads the following matters.
(1)The defendant is the legal owner of one undivided 50% interest in the mining lease known as M77/450 and the prospecting licence known as P77/3982 (the Tenements), commonly described as the Birthday Mine, and the legal owner of 50% of the infrastructure located on the Tenements (the Infrastructure).
(2)By written contract for sale dated 19 April 2011 (the Contract), the plaintiff agreed to purchase and the defendant agreed to sell all of its right and interest in the Tenements and the Infrastructure (together, the Mining Assets).
(3)It was a term of the Contract that the purchase price be paid by $350,000 in cash and 3 million 5c shares in Inosite Ltd (Inosite).
(4)On 29 November 2011 the plaintiff and defendant agreed through emails and discussions to vary the Contract so that the cash component was reduced to $270,000 and the share component was substituted with 1.5 million 5c shares in Inosite and 3.1 million 5c shares in El Corporation Ltd (El Corp). The El Corp shares would be transferred to the defendant after the plaintiff became the legal owner and prior to El Corp relisting on the Australian Stock Exchange (ASX).
(5)It was also a term of the agreement as varied that, as security for performance of the plaintiff's obligations under the Contract as varied, the defendant would be entitled to lodge a consent caveat over the Tenements.
(6)Further, upon payment of this substituted cash component, the defendant would do everything necessary to enable the transfer of legal title of the Tenements and Infrastructure to the plaintiff, and in the meantime the plaintiff would be responsible for rates and charges.
(7)On or about 30 November 2011 the plaintiff provided a bank cheque in the sum of $270,000 in satisfaction of the cash component of the purchase price.
(8)On or about 12 December 2011 the defendant delivered to the plaintiff signed copies of the transfers for the Tenements and the Infrastructure.
(9)The 1.5 million Inosite shares have been transferred to the defendant.
(10)On 10 October 2012 the plaintiff and defendant orally agreed to further vary the Contract by amending the substituted share component to 5 million 5c shares in Inosite.
(11)The defendant has breached the Contract by non performance.
(12)The plaintiff claims an order for specific performance of the Contract as varied in October 2012, alternatively as varied in November 2011.

The relief sought by the plaintiff

The plaintiff claims orders for summary judgment to the following effect:
1.It be declared that the defendant's undated letter sent to the plaintiff on or about 13 December 2012 purporting to terminate the parties' contract for sale of mining tenements M77/450 and P77/3892 dated 19 April 2011 (as varied) (the Contract) was ineffective at law to terminate the Contract.
2.It be declared that the Contract remains on foot.
3.The defendant is to perform its obligations under the Contract by
3.1executing and providing to the plaintiff transfers of M77/450 and P77/3982 in registrable form by no later than 4 pm 28 March 2013;
3.2subject to the plaintiff (if and to the extent necessary) issuing and causing to be delivered to the defendant a share certificate or share certificates certifying the registration of the defendant as the holder of 3.1 million shares in El Corp:
3.2.1causing caveats 390361 and 415185 to be removed from M77/450;
3.2.2causing caveats 390362 and 415184 to be removed from P77/3982.
Thus, for the purposes of summary judgment the plaintiff does not pursue its primary case to enforce the Contract as varied in October 2012.

The evidence

The plaintiff relies on his affidavit of 18 March 2013, save that the confidential annexure SAS1 is not relied on. (That was relied upon only in support of the application for urgent hearing of this application). The defendant relies on the affidavit of its director, Mr Gerard Kenworthy of 25 March 2013. As will be seen, there is some conflict in the affidavits. An application for summary judgment is not an occasion for resolving such conflicts.
I summarise the evidence as follows.
Mr Kenworthy says he first met with the plaintiff on 23 March 2011. At that meeting, the plaintiff told Mr Kenworthy that he was managing director of Inosite Ltd, a publicly listed company on the ASX, and that he was seeking to purchase Jagem's interest in the mine so as to transfer the mine to Inosite: Kenworthy [8]. During the meeting, the plaintiff told Mr Kenworthy that after the mine was acquired by Inosite, the value of the shares in Inosite would increase: Kenworthy [9].
Thus by the time the parties entered into a Contract it was a mutually known fact that Inosite was a listed company.
In April 2011 the plaintiff and defendant entered into a written contract (the Contract) for the purchase by the plaintiff and sale by the defendant of the defendant's 50% interest in the Tenements and the Infrastructure. The terms of the Contract included that subject to a due diligence process, the plaintiff would pay to the defendant the total sum of $500,000, made up of $350,000 in cash and 3 million 5c shares in Inosite (clause 4): see SAS 7.
The Contract provided by cl 15 that it was contingent on the purchaser successfully raising $350,000 through sale of Inosite shares within 60 days.
At around the same time the plaintiff also entered into a purchase contract with the owner of the other 50% interest in the Mining Assets, Mrs Fradl: Shilkin [14].
In August 2011, the parties executed an addendum to the agreement. That addendum provided as follows:
(1)that all aspects of the agreement remained in force with the exception of condition 5 in that agreement;
(2)condition 5 refers to the timeframe for final payment. This is in conflict with conditions 1 and 2 of the original agreement, in that certain requirements could not be and were not fulfilled by the parties within the timeframe allowed for in condition 5 of that agreement;
(3)that the due diligence requirement did not provide sufficient information to obtain a meaningful geologist report;
(4)the purchaser undertakes to have further works done at his expense to provide a geologist report;
(5)this report is a condition required to fulfil condition 15 of the original agreement. Inosite Ltd's shareholders cannot advance funds until this is done. Under legislation this is a requirement for a public company to provide to its shareholders in relation to acquiring mining assets; and
(6)it is therefore agreed that the settlement date be extended to a specific future date of 30 September 2011: see GK 2.
The plaintiff presented the addendum to Mr Kenworthy, who took it away, and then signed it: Kenworthy [17] ‑ [18].
There were a number of emails exchanged between the plaintiff and Mr Kenworthy in September, October and November 2011: see GK 3 ‑ GK 15.
By the plaintiff's email of 11 September 2011, he indicated that it was then proposed that Inosite would hold shares in a different ASX company, associated with some Singaporean investors, saying that Inosite should follow the other company's share price upwards. The email said that the cash component should be available by the end of September: see GK 4.
The plaintiff put forward a suggestion of cash components and other details in his email of 21 September 2011: see GK 6. Email discussions about these matters continued through late September.
On 29 September 2011, there was an email exchange in which the question of the value of Inosite's shares, and the value of its underlying assets, were mentioned. There was also reference to the ASX site, the price at which El Corp shares were trading, and to Inosite's future share price: see GK 10 ‑ 11.
In November 2011, Mr Shilkin entered into an agreement for sale of the Mining Assets between El Corp as purchaser and him as vendor. The obligations of the parties were conditional on a number of things, including that El Corp obtained conditional approval to be readmitted to the ASX (clause 2.1(b)). It was also subject to Mr Shilkin completing the agreements that he had with the defendant and Mrs Fradl for the acquisition of the Mining Assets (clause 2.1(d)). Clause 4.2 required El Corp to allot and issue to him 22 million shares in El Corp at settlement: see SAS 8.
Prior to entering that agreement, after entering a heads of agreement with El Corp, Mr Shilkin spoke to Mr Kenworthy about the consideration to be paid for Jagem's share of the gold mine. Mr Shilkin went overseas, leaving his son, Ashley, to communicate with Mr Kenworthy: Shilkin [19] ‑ [21].
By letter of 28 November 2011, sent by email, Mr Kenworthy proposed that the consideration payable under the contract be varied so that it was:
(a)$270,000 in cash, to be paid immediately;
(b)400,000 Inosite shares to be issued forthwith;
(c)4.2 million El Corp shares to be issued following an EGM or AGM of the company in 2012: see GK 16 and SAS 9.
That email attached unsigned transfers of the Tenements: see SAS 10.
Ashley Shilkin responded on the plaintiff's behalf by an email that evening. Mr Ashley Shilkin's response stated that:
(a)time was not of the essence and notice needed to be issued in the event that the scheduled time expires;
(b)the deal will not proceed if title is not transferred, as the El Corp deal would then not be done;
(c)there is room for compromise with the shares, but only if the transfer is signed;
(d)if the transfer is not signed then the purchaser would wait for shares to be issued from El Corp and then transfer shares and cash at that time: see GK 17 and SAS 11.
By email of 28 November 2011 Mr Kenworthy wrote to Ashley Shilkin. The email:
(a)said that after the telephone conversation he would agree to the transfer of the Tenements to ensure that the contract with El Corp is not compromised;
(b)said that having spoken to the Mines Department he doubted that the plaintiff's authorisation for placement of the caveats would be accepted;
(c)stated that a handshake deal should be good enough;
(d)stated a preference for 4.2 million El Corp shares, but said that he was open to a fair and reasonable negotiation;
(e)stated that the next day his son would contact Mr Ashley Shilkin about the handover of the transfer documents in exchange for the bank cheque for $270,000: see GK 18.
Later that evening, on 28 November 2011, Mr Ashley Shilkin responded, saying that the purchasers could proceed in accordance with Mr Kenworthy's email, with a compromise on the share allocation of 3.1 million El Corp shares and 1.5 million Inosite shares: see GK 21. In response, Mr Kenworthy said by email that he agreed to proceed accordingly. He proposed that his son would make time to meet and handover the transfer forms. He asked that the bank cheque and the share certificate for 1.5 million shares in Inosite be made out to the defendant: see GK 22.
On the face of it, this email chain gives rise to a binding agreement to vary the Contract to provide for the defendant to immediately deliver executed transfers of the Mining Assets in consideration of payment of a bank cheque of $270,000, with 1.5 million shares in Inosite to be provided immediately, and 3.1 million El Corp shares to be issued in 2012.
This much appears to be common ground.
In issue is whether it was a term of that agreement that the companies would be listed and that El Corp would become the owner of the mine.
$270,000 was paid to Jagem on 1 December 2011. On 13 December 2011 1.5 million Inosite shares were issued to Jagem: Kenworthy [24].
In December 2011 the plaintiff received a standard transfer form for 1.5 million shares in Inosite signed by Mr Kenworthy on behalf of the defendant as transferee, and signed transfers for the Tenements (these are not attached to the affidavit): Shilkin [30].
The plaintiff did not lodge the signed transfers for the Tenements: Shilkin [33].
On 7 December 2011, El Corp announced that it had entered into a sale and purchase agreement for the acquisition of the mine: Kenworthy [27].
When Mr Kenworthy attempted to lodge caveats over the tenements in February 2012, to protect the defendant's interest in receiving the balance of consideration, he found, to his surprise, that the transfers had not been registered and the caveats were rejected: Kenworthy [28].
On 12 March 2012, El Corp announced that it had paid a deposit for the acquisition of the Birthday Mine. On 27 April 2012, El Corp announced an amendment to the terms of the agreement for the acquisition of the mine: Kenworthy [29] ‑ [30].
In email correspondence between March and June 2012, Mr Kenworthy forwarded reminders for payment from the Department of Mines and Petroleum to the plaintiff, asking that the plaintiff attend to payment or compliance: see SAS 17. In some of those emails he expressed his view of the position, that the plaintiff was the owner of the Tenements.
In August 2012 Mr Kenworthy and the plaintiff exchanged emails about the signing of transfers in a proper form, asking for original signatures. In those emails Mr Kenworthy stated that he wanted to get the matter bedded down: see SAS 18.
On 19 September 2012 Mr Kenworthy sent an email asking for an update about the issue of El Corp shares: see SAS 19.
On 21 September 2012 El Corp made an announcement to the ASX that the agreement for the purchase of the Birthday Mine had been terminated because a condition precedent could not be satisfied, namely El Corp had failed to raise the minimum subscription for its capital raising: see SAS 20.
On 8 October 2012 the plaintiff emailed Mr Kenworthy saying he would like to meet and bring him up to date on the latest development on the 'ongoing saga'. They agreed to meet at Karrinyup Shopping Centre on Wednesday 10 October 2012: see SAS 21.
The plaintiff says that at the meeting he said to Mr Kenworthy words to the effect that the agreement with El Corp had come to an end and had not been performed. In response Mr Kenworthy said words to the effect that since that deal had fallen through he has doubts about El Corp and he was keen to get involved in Inosite if it is listed, and the mine sold to it instead. In response, the plaintiff said that he could get 5 million Inosite shares instead of the El Corp shares. Mr Kenworthy said he would be happy to take 5 million Inosite shares: Shilkin [41] ‑ [44].
Mr Kenworthy's evidence about this meeting is to quite different effect.
According to Mr Kenworthy, the plaintiff advised him that the agreement between him and El Corp had been terminated. Mr Shilkin said that he wanted to put a proposal to Mr Kenworthy for Jagem to receive further shares in Inosite in place of the El Corp shares. The meeting concluded on the basis that he would put a proposal to Mr Kenworthy. The number of shares in Inosite was not mentioned at the meeting. At the meeting, the plaintiff said that the mine would be sold to Inosite, after Inosite was re‑listed: Kenworthy [34].
Mr Kenworthy says that the ASX records show that Inosite had been de‑listed on 3 July 2012: Kenworthy [34].
It is common ground that this application must be determined on the basis that Mr Kenworthy's evidence may be accepted at a trial. Thus the application is to be determined on the assumption that the discussions at Karrinyup Shopping Centre did not give rise to any variation to the agreement.
There is no evidence of any contact between the parties from that meeting to 10 December 2012.
On 10 December 2012, following a telephone call from Mrs Fradl, the plaintiff says that he telephoned Mr Kenworthy. Mr Kenworthy told the plaintiff that 'he was taking the mine back, he was sick of it all': Shilkin [45] ‑ [46].
Mr Kenworthy says he heard nothing further after the October meeting until about 10 December 2012 when he was telephoned by the plaintiff. He says the plaintiff said that he was not to speak to Mr Osman (mining consultant commissioned by Mr Shilkin to provide geological reports): Kenworthy [36].
On 11 December 2012 the plaintiff sent an email to Mr Kenworthy. The email stated that 'by way of confirmation [the defendant] is standing in the Inosite share register as the holder of 5 million fully paid 5c shares. The new share certificates for Inosite are to be printed and will be posted to all shareholders early in 2013 to coincide with the planned ASX listing of Inosite early in 2013 which will involve a one for four consideration': see SAS 22.
In response, Mr Kenworthy said by email 'by way of confirmation the defendant has not agreed to take up 5 million shares in Inosite which is a delisted company': see SAS 24.
By letter received on or about 13 December 2012 the defendant purported to terminate the contract on the basis that Inosite shares were issued instead of El Corp shares. The letter stated that the defendant considered the purchase contract to be breached because the purchaser had failed to fulfil a condition of the Contract to supply El Corp shares. The letter stated that the defendant did not accept shares in Inosite and that the agreement was terminated: see SAS 25.
The plaintiff says that he was ready, willing and able to perform the Contract as varied, or in accordance with the Contract as varied in November 2011 without the October 2012 variations: Shilkin [55].

Summary judgment: principles

The caution with which the power to grant summary judgment is to be exercised is well known. The power to order summary judgment should never be exercised unless it is clear there is no real question to be tried: Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87, 99. It is only in the clearest of cases, when there is a high degree of certainty about the ultimate outcome of the proceeding if it went to trial, that summary judgment ought be given: Agar v Hyde [2000] HCA 41; (2000) 201 CLR 552 [57]; Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256 [46].

The disposition of the application

In summary, I would refuse to grant summary judgment because I consider each of the following to be arguable:
(1)by his email of 11 December 2012, the plaintiff repudiated the contract as varied in November 2011; and
(2)it was an inferred or implied term of the contract as varied in November 2011 that El Corp and Inosite would be listed on the ASX, and that El Corp would become the owner, or become entitled to be the owner, of the mine, with the result that, in December 2012, the defendant had a right to terminate.
Either of these propositions, if arguable, is sufficient to defeat the summary judgment application. In my view, both are arguable. Neither proposition can be said to be sufficiently certain to be rejected at trial to sustain the grant of summary judgment.
I proceed to explain those conclusions.

Repudiation by the email of 11 December 2012?

By the email of 11 December 2012, the plaintiff asserted that the defendant stood in the Inosite share register as the holder of 5 million fully paid shares. That assertion was said to be 'by way of confirmation'.
The plaintiff submits that a party who mistakenly asserts an erroneous interpretation of the contract does not thereby repudiate the contract, referring to DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423, 432. The plaintiff submits that the letter could not give rise to a right to terminate. I do not accept that the position is sufficiently certain to sustain summary judgment.
In my view, whether an erroneous interpretation of a contract, or assertion as to the terms of the contract, amounts to a repudiation depends upon the circumstances.
A party repudiates a contract if it evinces an intention no longer to be bound by it, or to fulfil its obligations only in a manner substantially inconsistent with its obligations: Laurinda v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623, 634; Koompahtoo Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115 [44]. The test is whether the conduct of one party is such as to convey to a reasonable person in the situation of the other party, renunciation either of the contract as a whole or the fundamental obligation under it: Koompahtoo [44].
Asserting an incorrect interpretation of a contract may or may not be a repudiation, depending on the circumstances. See Cheshire and Fifoot, Law of Contract (10th ed 2012) [21.12] and the cases in footnotes 67 and 68. There it is said that an honest belief in an incorrect interpretation does not conclusively negate the presence of repudiatory intent. See also, Carter, Contract Law in Australia (6th ed 2013) [30 ‑ 39] ‑ [30 ‑ 41].
The plaintiff submits that it is ready willing and able to tender shares in El Corp, and it has never indicated that it would not do so. In my view, it is arguable that the plaintiff's email of 11 December 2012 was impliedly asserting that the 5 million 5 cent shares in Inosite constituted the whole of the outstanding consideration for the transfer of the defendant's interest in the Mining Assets. The email was not expressed as a tentative proposal.
To my mind, the question of whether the email of 11 December 2012 was a repudiation should be determined at trial, in the light of all the circumstances.

The terms of the agreement as varied in November 2011

As I have said, it is common ground that the emails exchanged on 28 November 2011, and possibly some intervening telephone conversations, gave rise to an agreement to vary the Contract. The variation provided for the defendant to immediately deliver executed transfers of the Mining Assets in consideration of the payment of the bank cheque of $270,000, and 1.5 million shares in Inosite to be provided immediately, and 3.1 million El Corp shares to be issued in 2012. However, it is in issue whether it was a term of that agreement that the companies would be listed, and that El Corp would become entitled to become the owner of the mine.
In my view, in identifying the terms of the agreement of November 2011 the starting point is a recognition that that agreement did not involve a formal contract that was complete on its face. That is so even though the conduct and communications in November 2011 were varying the Contract made in April 2011, which itself was or appears to have been a contract that was complete on its face.
Moreover, the plaintiff pleads that the agreement in November 2011 to vary the Contract was partly by email and partly oral. In those circumstances the gateway requirement of ambiguity for the admission of extrinsic evidence (relied on in the plaintiff's written submissions) does not apply, or at least arguably does not apply.
Further, the test for implication of terms differs depending upon whether the contract is a formal instrument complete on its face or not. Where the contract is not complete on its face, the Codelfa test (Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337, 347) does not apply. A term can be implied if it is necessary for the reasonable or effective operation of the contract in the circumstances of the case: Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410, 422, 442.
The question of what terms are to be inferred and implied into an informal agreement is sensitive to all the circumstances of the communications leading up to and constituting the agreement. That underlines the need for caution in an application for summary judgment.
A number of elements of what is said in the communications between the parties prior to 28 November 2011, and in the email exchanges on that day, provide some support for the term contended by the defendant.
The plaintiff's email of 11 September 2011 says, in effect, that Inosite would hold shares in a further ASX listed company associated with some Singaporean investors, and that the Inosite shares would follow the other ASX share price upwards. Plainly, that contemplates that the ASX company associated with the Singaporean investors would own the mine.
Mr Kenworthy's email of 29 September 2011 refers to an announcement on the ASX that El Corp had an acquisition target date for the mine. That email also referred to the impact of acquiring El Corp shares on Inosite's future share price, revealing a contemplation that Inosite was listed on the ASX and would own shares in El Corp. See also, annexure GK 11 and GK 15.
Mr Kenworthy's letter of 28 November 2011, sent by email, included the statement that the defendant understood that the El Corp shares would be transferred to each, to satisfy payment as agreed, after authorisation by the El Corp shareholders at an EGM or AGM in 2012.
Further, there is some support for the term contended for by the defendant in the scheme and structure of the Contract as varied. The scheme of the Contract as varied was that the Mining Assets would be provided to the plaintiff immediately, in exchange for cash and Inosite shares, with shares in El Corp to be provided subsequently. Mr Ashley Shilkin's email of 28 November 2011 spelled out that title to the Mining Assets needed to be transferred immediately from the defendant to the plaintiff, in order to enable El Corp's purchase of the Mining Assets to proceed (see the reference to the El Corp deal not being done). That supports a common intention that, subject to the approval of El Corp shareholders, the plaintiff would transfer the Mining Assets to El Corp and El Corp would issue shares to the defendant.
The evident commercial purpose of the agreement, and commercial common sense, might also be thought to provide some support for the defendant's inferred or implied term. The shares were a substantial component of the consideration: originally 30%, and by the agreement of November 2011, 46%. If the shares issued as consideration for the sale of the interest in the mine are in a company that will own the mine (or own shares in the company that owns the mine) then the commercial sense of the consideration is clear enough. If the shares are in a company that is not listed, and does not own the mine or shares in the mine, the commercial purpose of the consideration is less obvious. Of course, this is by no means a decisive consideration. The parties to a contract may chose consideration in whatever form they select. Nevertheless, in the circumstances of this case, these considerations seem to me to provide some support for the defendant's inferred or implied terms.
Finally, it is an objective fact that the acquisition by El Corp of a right to acquire the mine from the plaintiff was the catalyst for the restructuring of the consideration to be received by the defendant for the sale of its interest in the mine to the plaintiff.
In my view, these considerations support the conclusion that the defendant's inferred or implied term is arguable.
The plaintiff's submissions put considerable emphasis on the language used by Mr Kenworthy in his letter of termination, and in his affidavit, in explaining the reason and ground for the defendant's termination of the Contract. Mr Kenworthy expressed the ground for termination as being that the El Corp shares had not been provided. He did not say that it was the fact that El Corp did not, and would not, own the Birthday Mine that justified the termination. Moreover, he knew for two months (since the October 2012 meeting) that El Corp had terminated its contract to purchase the mine from the defendant, but did nothing before 10 December 2012.
I accept that, arguably at least, evidence of post contractual conduct may be admissible on the issue of implying or inferring terms. See Fazio v Fazio [2012] WASCA 72 [193] ‑ [195]; Cheshire and Fifoot's Law of Contract (10th ed 2012) [10.16] and the cases cited in footnotes 177 and 178. However, in that regard, the weight to be given to Mr Kenworthy's conduct and to the way in which he expressed the ground for termination, in assessing whether there was an inferred or implied term to the effect alleged, is a matter for trial. It is not of such overwhelming significance as to sustain the grant of summary judgment, either taken alone or in combination with the whole of the circumstances of the case.
If, as I have found, there is arguably an inferred or implied term that the two companies would be listed and El Corp would own the mine, it is arguable that, by December 2012, the plaintiff was disabled from performing its obligations, given El Corp's announcement that it had terminated the Contract to purchase the mine from the plaintiff, and that such an inability to perform justified the defendant's termination of the agreement as varied.
I recognise that arguments are available in response to what I have set out above. The question for present purposes is not the ultimate merits of these contentions. It is sufficient to conclude, as I have, that these contentions are arguable to make the grant of summary judgment inappropriate.
That being so, it is not necessary for me to deal with the defendant's alternative contention that:
(1)the November 2011 emails and the preceding communications between the parties reveal a common assumption that both El Corp and Inosite would be listed, and that El Corp would become the owner of the mine;
(2)performance of the Contract in the absence of that assumption is fundamentally different from what is contemplated under the agreement on its true construction; and
(3)the non‑fulfilment of the assumption meant that the Contract was, by December 2012, frustrated.

Conclusion

For these reasons, I dismissed the application for summary judgment.