Sijehama Pty Limited & Anor v The Coal Cliff Collieries Pty Limited

Sijehama Pty Limited and Bulli Main Colliery Pty Limited (the applicants) sought special leave to appeal to the High Court of Australia against a decision of the Court of Appeal. The dispute concerned the enforceability of a heads of agreement, which the applicants argued was binding, despite containing a provision for further negotiation of detailed terms. The respondents, The Coal Cliff Collieries Pty Limited and Kembla Coal and Coke Pty Limited, were the opposing parties.

The primary legal issue before the High Court was whether the Court of Appeal had erred in finding that the heads of agreement was an incomplete and unenforceable agreement, specifically concerning the proposition that courts will not enforce agreements to agree in the future. The applicants contended that this proposition, as applied by the Court of Appeal, imperilled common contractual arrangements where heads of agreement are intended to be binding subject to the negotiation of further details.

The applicants argued that the Court of Appeal's decision was problematic and had caused concern within the legal community, particularly for practitioners involved in mining and petroleum law. They sought to have the principle that courts will not enforce incomplete agreements, as stated in Booker Industries, reconsidered in circumstances where it truly arose for decision. The applicants referred to specific clauses within the heads of agreement to illustrate their submission that the parties intended to be bound by the document, despite the need for subsequent detailed negotiation.