The J & P Marlow (No 2) Pty Ltd v Joseph Hayes & Andrew McCabe in their capacity as joint and several liquidators of Peak Invest Pty Ltd (in liq), Five Islands Invest Pty Ltd (in liq), Surry Hills Pub Invest Pty..

The dispute before the Court of Appeal of New South Wales concerned the proper construction of hotel management agreements. The applicants, J & P Marlow (No 2) Pty Ltd, were the hotel manager, while the respondents, Joseph Hayes and Andrew McCabe, acted as the joint and several liquidators of three companies that owned the hotel businesses. The central issue revolved around the calculation of a "Capital Gains Bonus Fee" payable to the hotel manager under these agreements, which depended on the interpretation of the term "Net Sales Price."

The primary legal question before the court was whether the "sale price of the property" within the definition of "Net Sales Price" referred to the aggregate sale price of the land and buildings, or if it also encompassed the sale price of the hotel businesses themselves. This distinction was significant because the land and buildings were owned by separate entities from the hotel businesses, although all were sold concurrently. The liquidators sought declarations regarding the correct interpretation of the agreements.

The Court of Appeal applied established principles of contractual construction, emphasizing the objective ascertainment of the parties' intention by reference to the language of the agreement itself, considered in its commercial context. The court held that the phrase "sale price of the property" in the context of the formula for the Capital Gains Bonus Fee referred only to the sale price of the land and buildings, and not the hotel businesses. The court reasoned that the agreements, when read as a whole and in light of their commercial purpose, did not support an interpretation that included the sale of the businesses within the definition of "property" for the purpose of calculating this specific bonus fee. The commercial purpose of the agreement was considered, but not to the extent of distorting the plain meaning of the contractual terms.

The appeal was dismissed, and the appellant was ordered to pay the costs of the respondents.