Threadgold Architecture Pty Ltd v Staunton Developments Pty Ltd - [2025] WASCA 88

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT :   THE COURT OF APPEAL (WA)
CITATION:   THREADGOLD ARCHITECTURE PTY LTD -v- STAUNTON DEVELOPMENTS PTY LTD [2025] WASCA 88
CORAM:   MITCHELL JA
VAUGHAN JA
ARCHER JA

HEARD: 17 APRIL 2025
FURTHER SUBMISSIONS FILED 24 APRIL & 7 MAY 2025

DELIVERED          :   13 JUNE 2025
FILE NO/S:   CACV 33 of 2024
BETWEEN:   THREADGOLD ARCHITECTURE PTY LTD
Appellant
AND
STAUNTON DEVELOPMENTS PTY LTD
Respondent

ON APPEAL FROM:
Jurisdiction              :   SUPREME COURT OF WESTERN AUSTRALIA
Coram:   ACTING MASTER McDONALD
File Number            :   CIV 1397 of 2023

Catchwords:

Appeal against summary judgment for defendant - Construction relied upon in relation to one of pleaded causes of action untenable - Other pleaded causes of action did not depend on that construction

Legislation:

Nil

Result:

Appeal allowed
Notice of contention dismissed

Decision of acting master set aside and substituted with order granting summary judgment to respondent in relation to claim for relief for breach of asserted contractual term that respondent was obliged to cause removal of sand
Application in appeal filed 6 June 2025 dismissed

Representation:

Counsel:

Appellant	:	C P K Russell SC & D R Purdy
Respondent	:	M C Hotchkin

Solicitors:

Appellant	:	Pragma Lawyers
Respondent	:	Michael Hotchkin Consulting

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

Ainsworth v Criminal Justice Commission [1992] HCA 10; (1992) 175 CLR 564
Frigger v The State of Western Australia [2025] WASCA 7
Pisano v South Metropolitan Health Service [2023] WASCA 80; (2023) 414 ALR 130
Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332
Threadgold Pty Ltd v Staunton Developments Pty Ltd [2024] WASC 199
Zerjavic v Chevron Australia Pty Ltd [2020] WASCA 40

JUDGMENT OF THE COURT:

Overview

This is an appeal against a decision to grant summary judgment to a defendant.
The plaintiff at first instance (Threadgold) commenced proceedings alleging that the defendant (Staunton) had breached a revenue sharing agreement. Under the agreement, the parties had agreed to share a proportion of the income to be derived from the removal of sand from a property in Yelverton. The Yelverton property was sold by the director of Threadgold to Staunton on the same day the parties entered into the agreement.
Staunton applied for summary judgment on the basis that the action brought by Threadgold was so clearly untenable that it could not possibly succeed at a trial. Staunton contended that Threadgold's case rested upon its plea to the effect that, under cl 2 of the revenue sharing agreement, Staunton was obliged to cause the removal of sand from the land.
Clause 2 provides that Staunton 'agrees to use all reasonable endeavours to allow the extraction of all sand within the shortest time possible'.
Staunton contended that that obligation, to 'allow' the extraction of sand, could not be construed as an obligation to 'cause' the extraction of sand. It contended that there was no constructional choice as to the proper construction of the clause that required resolution or reference to any extrinsic facts. It contended that, therefore, summary judgment should be granted.
Threadgold contended that Staunton had failed to demonstrate that that construction was untenable. It submitted that the acting master could not resolve the dispute without evidence as to the circumstances in which the agreements were entered into and their commercial purpose.
The acting master held that the construction that Staunton was obliged to cause the sand to be removed was untenable. The acting master granted summary judgment in favour of Staunton.
Threadgold appeals on five grounds. The first ground of appeal is at the heart of the appeal.
By ground 1, Threadgold contends that the acting master erred in finding that, in order to succeed at trial, Threadgold would have to prove that Staunton was obliged to cause the removal of sand from the land. It contends that, even assuming that this construction was untenable, there were other pleaded causes of action that did not depend upon that construction. The statement of claim sought, among other things, damages for breach of the agreement and a declaration that the agreement remained on foot. Threadgold contends that neither claim was founded on any obligation on Staunton to cause the removal of sand. It submits that there was therefore a real question to be tried.[1]
[1] Ground 1, appellant's submissions [27] ‑ [31] WAB 19 - 20.
Threadgold concedes that much of what it now argues was not put to the acting master by its then counsel (not counsel in the appeal). Before the acting master, Threadgold appeared to accept that summary judgment could be granted if the acting master found that it was not tenable to construe the agreement as imposing an obligation on Staunton to cause sand to be removed. Threadgold did not contend that, if that construction was not tenable, there was some other reason to refuse summary judgment. In particular, Threadgold did not contend that, if its construction was not tenable, summary judgment should nevertheless be refused because there could still be some utility in a declaration that the agreement remained on foot, or because it had a claim for damages that was not founded on that construction.[2]
[2] See appellant's submissions [24] WAB 18. And see GAB 39 - 46; appeal ts 7 - 8, 21 - 22.
Threadgold's failure to argue these matters before the acting master is not fatal to the appeal. It is, however, relevant to the appropriate costs orders to be made on the appeal.
During the appeal, Staunton was given leave to file a notice of contention. By that notice, Staunton contends that, if the acting master is found to have erred in failing to consider other causes of action arising from the pleading, her decision should nevertheless be upheld because the evidence did not disclose an arguable fact to support any alternative cause of action and Threadgold did not contend what other causes of action remained open and arguable as pleaded, on the evidence before the court.
For the reasons that follow, we would allow the appeal and dismiss the notice of contention.

Factual background

Stuart Threadgold was the owner of 157 Haag Road, Yelverton in south-west Western Australia. Mr Threadgold had an agreement with the appellant Threadgold (of which he is the sole director) that allowed Threadgold to remove sand from the land and retain all proceeds from the sale of the sand.
On 5 April 2020, Threadgold applied to the Department of Water and Environmental Regulation (DWER), by clearing permit application CPS 8863/1, for a clearing permit that would facilitate the removal of sand from the land.[3] On 3 July 2020, by development approval application 20/0437, Threadgold applied to the City of Busselton for development approval for the extraction of sand from part of the land.[4]
[3] See Threadgold Architecture Pty Ltd v Staunton Developments Pty Ltd [2024] WASC 199 (primary decision) [17(4)]; GAB 119 [10(a)].
[4] See primary decision [17(3)]; GAB 119 [10(b)].
On 15 March 2021, Threadgold entered into an agreement which granted Cotton Holdings Pty Ltd trading as APH Contractors (APH) an exclusive right to remove sand from the land on certain terms and conditions (Sand Removal Agreement).[5]
[5] The Sand Removal Agreement can be found at GAB 91 ‑ 99.
On 26 August 2021, DWER approved clearing permit CPS 8863/1 in principle.[6]
[6] Appeal ts 4; GAB 122 [14].
On 19 October 2021, Staunton purchased the land from Mr Threadgold. On the same day, the parties entered into an agreement under which they would share revenue to be derived from the removal of sand from the land (Revenue Sharing Agreement).[7]
[7] The Revenue Sharing Agreement can be found at GAB 89 ‑ 90.
Threadgold pleaded that, as at that date, the parties knew, among other things, the following facts:[8]
[8] Statement of claim par 8.
(1)before entering into the contract for the sale of the land, Threadgold had substantially completed the work (or had completed a material part of the work), including the obtaining of approvals, necessary to enable sand to be lawfully removed from the land on a commercial basis;
(2)Threadgold and APH had entered into the Sand Removal Agreement and its terms and purpose;
(3)by development approval application 20/0437, Threadgold had applied for development approval for removal of sand from part of the land;
(4)Threadgold had also applied for a clearing permit, which had been approved in principle;
(5)Threadgold and Mr Threadgold had agreed that, in consideration of Threadgold acting or causing to be taken all necessary steps to remove and sell sand from the land, Threadgold would be entitled to any proceeds or profits derived from that; and
(6)the commercial purpose of the Revenue Sharing Agreement, in circumstances where:
(a)Mr Threadgold wished to sell, and Staunton wished to buy the land;
(b)Threadgold had undertaken work in respect of the land which added value to the land; and
(c)Threadgold had not been compensated for that work or otherwise rewarded for the adding of value;
was to ensure that Threadgold was compensated for that work, notwithstanding the sale of the land by Mr Threadgold to Staunton.

Revenue Sharing Agreement

The Revenue Sharing Agreement recites that Threadgold has separately agreed to sell the land to Staunton. It further recites that Staunton has agreed to share a portion of the 'income planned to be derived from the removal of sand' from the land, subject to the terms that follow.[9]
[9] GAB 89.
The Revenue Sharing Agreement relevantly provides:[10]
[10] GAB 89 - 90.
(1)By cl 1, Staunton 'will share 50% of the income derived from the sand removal ($2.00 per Tonne excluding GST) as contemplated in [the Sand Removal] Agreement, subject to':
(a)Threadgold procuring all required approvals[11] within 13 months from the date of the agreement (so by 19 November 2022);
[11] Defined as being all the council and other approvals required to ensure the lawful extraction and removal of sand.
(b)Threadgold 'pays all costs associated with procuring such approvals'; and
(c)Threadgold assigns to Staunton, 'all rights and obligations under the [Sand Removal] Agreement'.
(2)By cl 2, Staunton 'agrees to use all reasonable endeavours to allow the extraction of all sand within the shortest time possible'.
(3)By cl 3, '[t]he revenue sharing only relates to [development approval application 20/0437] and as covered by the [Sand Removal] Agreement'.
(4)By cl 4, Staunton could enter into a different agreement with APH to maximise tax efficiency, provided that did not adversely or materially affect Threadgold.
(5)By cl 5, the Revenue Sharing Agreement ceases at the earlier of:
(a)the 'completion of the sand removal as contemplated in the [Sand Removal] Agreement'; or
(b)five years from the settlement date of the property (being 26 November 2026).
(6)By cl 6, Threadgold and Staunton 'will act in good faith and use all reasonable endeavours to cooperate throughout the lifetime of this agreement'.

Sand Removal Agreement

The Sand Removal Agreement began with recitals, which are said by cl 1 to be included in its terms and conditions. The recitals relevantly provide:[12]
(1)By recital B, Threadgold 'shall obtain a Development Approval by the City of Busselton and Clearing Permit CPS 8863/1 for [APH] to extract sand from the land in accordance with the conditions set out in the Development Approval (hereinafter "the Approval")'.
(2)By recital C, '[w]hen granted, a copy of the Approval is set out in the First Schedule hereto'. (No approval had been granted at the time the Sand Removal Agreement was executed).
(3)By recital D, Threadgold 'has agreed with [APH] to allow [APH] exclusively to remove sand from the area identified on the plan set out in the Second Schedule hereto (hereinafter "the Plan") and otherwise upon the terms and conditions of this Agreement'.
[12] GAB 92. It appears to be common ground that the agreement which was JPT-5 of the affidavit of Jonathan Paul Timms sworn 9 May 2024 was the agreement said to be attached to the Revenue Sharing Agreement (see WAB 15 fn 2).
The Sand Removal Agreement then relevantly provides:
(1)By cl 2, Threadgold 'agrees that [APH] shall have the exclusive right to remove sand from the [l]and in accordance with the [a]pproval and from the area outlined in on the Plan from the date of execution of this Agreement until the expiration of the Approval OR 300,000 Loose Cubic Metres (LCM) of sand have been extracted, OR any extended date as hereinafter described'.
(2)By cl 3, APH shall pay to Threadgold 'an amount of $4.00 per tonne plus GST in respect to the sand removed from the [l]and and otherwise in accordance with the terms of this Agreement'.

Subsequent events

Staunton became the registered proprietor of the land on 26 November 2021.
On 6 May 2022, the City of Busselton granted development approval application 20/0437. A condition of the approval was that only 24 truck movements per day were permitted.[13]
[13] Agreed Chronology [5] WAB 39; GAB 100 ‑ 105.
The acting master found that APH did not remove sand from the land under the Sand Removal Agreement, or at all.[14]
[14] Primary decision [6].
In the hearing before the acting master, Staunton adduced evidence of emails from APH sent in late 2022 in which APH said that it would not be commercially attractive to take sand from the land under the conditions of the development approval, due to the limited number of truck movements permitted under that approval, and that it would be more effective to source the sand elsewhere unless the conditions were changed.[15] Threadgold submitted that that evidence could not be evidence that APH had actually decided it was not commercially viable and would not remove the sand, just that APH had said this in negotiations with Staunton.[16] The acting master found, however, that APH did not exercise its right to remove the specified sand because it did not consider that removal of the sand was commercially viable due to the conditions of the development approval.[17] That finding is not challenged by Threadgold in this appeal.
[15] See GAB 106 ‑ 116.
[16] See primary court ts 3 ‑ 7.
[17] Primary decision [63(2)].
On 27 January 2023, these proceedings were commenced.[18] The statement of claim was filed on 29 March 2023.
[18] Agreed Chronology [9] WAB 39. The action was commenced in the District Court but was remitted to the Supreme Court on 11 April 2023 - see primary decision [69], [71], [73].
On 9 May 2023, Staunton brought an application for summary judgment in favour of a defendant under O 16 r 1 of the Rules of the Supreme Court 1971 (WA). The application was brought out of time and so Staunton was required to seek leave.
On 18 October 2023, the conditions of the development approval 20/0437 (original development approval) were amended to, among other things, increase the maximum number of truck movements permitted (amended development approval).[19]

The statement of claim

[19] Agreed Chronology [9] WAB 39; GAB 129 [6], 141 ‑ 142.

In its statement of claim, Threadgold alleged that Staunton breached the Revenue Sharing Agreement.
By paragraph 9 of the statement of claim, Threadgold pleaded the proper construction of the Revenue Sharing Agreement, relevantly as follows:
9.On a proper construction [of] the Revenue sharing agreement the parties, relevantly, agreed:
(a)their agreement concerned the sand the subject of the Sand removal agreement (that is, the sand located on the part of the land identified in development approval application 20/0437) (specified sand);
(b)the plaintiff would procure development approval, the clearing permit, and any other approvals necessary to permit the lawful removal of the specified sand[;]
(c)the time for the plaintiff to procure the approvals was 13 months from the date of entry into the Revenue sharing agreement;
…
(f)the defendant would cause the removal of the specified sand from the land;
…
(k)the Revenue sharing agreement would subsist until the earlier of the date of the completion of the removal of the specified sand and 5 years from the date on which the defendant became the registered proprietor of the land;
(l)the plaintiff and the defendant would each act in good faith in their dealings with each other in respect of or in connection with the Revenue sharing agreement;
(m)the plaintiff and the defendant would cooperate with each other in all respects in relation to or in connection with the operation of the Revenue sharing agreement; and
(n)the defendant would use all reasonable endeavours to ensure that all steps to be taken in the performance of the agreement occurred within the shortest time possible to enable the plaintiff's interest in the land to be extracted in the shortest time reasonably possible.
Threadgold pleaded that, on a proper construction of the Sand Removal Agreement, APH would, subject to the development approval and the clearing permit being obtained, remove the specified sand from the land during the period provided for sand removal under the agreement.[20]
[20] Statement of claim par 12(c).
Threadgold pleaded that Staunton had, in breach of the Revenue Sharing Agreement
(1)from about 20 April 2022 to 1 July 2022, repeatedly refused or failed, despite requests by Threadgold, to advise DWER that Staunton was, as was the fact, authorised by Threadgold to procure clearing permit application 8863/1 (statement of claim paragraphs 16 and 17);
(2)caused a third party to apply for a clearing permit (statement of claim paragraph 18);
(3)itself applied for a clearing permit (statement of claim paragraph 19);
(4)acted in a manner that was likely to interfere, hamper, delay and prevent performance of the agreement by Threadgold (statement of claim paragraph 20);
(5)wrongfully asserted that, if Threadgold did not obtain a clearing permit within 13 months from the date of the agreement, Staunton was relieved of its obligations to Threadgold under the agreement (statement of claim paragraph 21(a)); and/or
(6)failed or refused to perform its obligations under the agreement (statement of claim paragraph 21(b)).
Threadgold submits that this conduct breached Staunton's obligations to cooperate and use reasonable endeavours, as pleaded in the statement of claim paragraphs 9(m) and 9(n), read with 9(b).[21]
[21] Appeal ts 4 - 5.

By paragraphs 22 and 23 of the statement of claim, Threadgold alleged that, but for Staunton's breaches of the Revenue Sharing Agreement, the clearing permit would have been granted within the required 13-month period, and extraction of the sand could have commenced on or about 1 July 2022.
By paragraph 24 of the statement of claim, Threadgold alleged that, by reason of these matters, it was deprived of the opportunity of sharing in revenue from the sand and had not received any share of revenue from the sale of sand extracted from the land, as contemplated by the Revenue Sharing Agreement.
The prayer for relief sought, among other things, a declaration that the Revenue Sharing Agreement remained on foot[22] and damages for breach of the agreement.[23]

Summary judgment application

[22] Statement of claim prayer for relief A(e). The full list of declarations sought is set out later under the heading 'Claim for a declaration'.

[23] Statement of claim prayer for relief C.

The acting master heard the summary judgment application on 17 August 2023 and reserved her decision.
On 28 November 2023, Threadgold sought leave to reopen and adduce evidence (proposed evidence). It contended that the proposed evidence was relevant to the APH emails that had been adduced by Staunton, in which APH said that it would not be commercially attractive to take sand from the land under the conditions of the original development approval, and that it would be more effective to source the sand elsewhere unless the conditions were changed. The proposed evidence was contained in an affidavit affirmed on that date by Daniel Robert Purdy, a lawyer acting for Threadgold.[24] Threadgold sought to rely on the proposed evidence to show that Staunton and APH had taken steps to amend the original approval, 'and that APH would now find the Sand [Removal Agreement] commercially attractive and effective'.[25]
[24] The affidavit is in GAB 128 ‑ 152.
[25] Plaintiff's outline of submissions in support of application to reopen and to lead new evidence, filed 12 December 2023 [16] ‑ [17].

Apart from a short directions hearing on 6 December 2023, Threadgold's application as to the proposed evidence was dealt with by way of written submissions.

The primary decision

The acting master published her reasons on 31 May 2024 and made orders on 14 June 2024. The acting master dismissed Threadgold's application to adduce the proposed evidence, granted Staunton leave to bring the summary judgment application out of time, and entered judgment for Staunton.
The learned acting master correctly identified the legal principles applicable to an application for summary judgment. She noted that summary judgment will only be granted where there is no real question to be tried and only when there is a high degree of certainty about the ultimate outcome if the matter went to trial.[26]
[26] Primary decision [26]; see Pisano v South Metropolitan Health Service [2023] WASCA 80; (2023) 414 ALR 130 [52].
The application to adduce the proposed evidence was dismissed on the ground that the evidence was irrelevant to the proper construction of the agreements.[27]
[27] Primary decision [16].
The acting master found that the summary judgment application turned on the proper construction of the Revenue Sharing Agreement, specifically whether Staunton was obliged to cause the removal of sand from the land.[28]
[28] Primary decision [31] ‑ [32].
The acting master held that, on its plain meaning, cl 2 of the Revenue Sharing Agreement did not require Staunton to cause the removal of sand (by removing it itself or by requiring someone else to remove it).[29] The acting master's reasons were to the following effect.
[29] Primary decision [48].
The word 'allow' in cl 2 is passive, whereas 'causing' the removal of sand is active. The phrase 'use all reasonable endeavours to allow' does not transform 'allow' into an active word. It simply prevents Staunton from taking unreasonable action that would prevent or delay the removal of sand (and this is also consistent with the obligations imposed on both parties by cl 6).[30]
[30] Primary decision [48] ‑ [49].
Read in the context of the whole of the Revenue Sharing Agreement and the Sand Removal Agreement, cl 2 is not ambiguous or capable of alternate constructions.[31] There was nothing in the Revenue Sharing Agreement that was inconsistent with the plain meaning of cl 2.[32] Similarly, the Sand Removal Agreement gave APH an exclusive right to remove sand but did not impose an obligation to do so.[33]
[31] Primary decision [56].
[32] Primary decision [50].
[33] Primary decision [53] ‑ [56].
Staunton had shown that the construction of the Revenue Sharing Agreement advanced by Threadgold was not arguable.[34] Threadgold therefore bore the evidentiary onus of showing there was still a triable issue.[35] Threadgold had not adduced any evidence to support its alternative construction of the Revenue Sharing Agreement. To the contrary, there was evidence of surrounding circumstances which supported Staunton's construction.
[34] Primary decision [62].
[35] Primary decision [29], [61] ‑ [62].
First, at the time the Sand Removal Agreement was entered into, Threadgold had not obtained the necessary approval to remove sand. It would not make commercial sense for the parties to have formed an agreement obliging APH to remove sand before the approval conditions were known and before it was known whether it would be commercially viable to remove the sand.[36]
[36] Primary decision [63].
Second, APH did not exercise its right to remove sand because it did not consider that removal of the sand was commercially viable due to the conditions of the original development approval.[37]
[37] Primary decision [63].
On the plain and unambiguous construction of the Revenue Sharing Agreement and the Sand Removal Agreement, there was never an obligation upon either APH or Staunton to remove, or to cause the removal of, sand. Threadgold's construction was not arguable. Therefore, its case could not possibly succeed at trial.[38]
[38] Primary decision [66] - [67].

Grounds of appeal

Ground 1 alleges that the acting master erred in determining that, in order to succeed at trial, Threadgold had to prove that, upon a proper construction of the Revenue Sharing Agreement, Staunton was obliged to cause the removal of sand.
Ground 1.1 alleges that the acting master ought to have instead found that the Revenue Sharing Agreement is open to multiple arguable constructions, each of which would require Staunton to share income derived from sand removal.
Ground 1.2 alleges that the acting master ought to have instead found that Threadgold did not need to prove that Staunton was obliged to cause the removal of sand in order to succeed at trial.
Ground 1.3 alleges that the acting master ought to have instead found that, because Threadgold sought a declaration that the Revenue Sharing Agreement remained on foot, there was a real question to be tried.
Ground 2 alleges that the acting master erred in failing to find that Threadgold had carried out work and spent money to enable the lawful removal and sale of sand from the land. Threadgold submits that those facts were relevant surrounding circumstances to the proper construction of the agreement and were not contradicted. It submits that they therefore ought to have been found as facts.
Ground 3 alleges that the acting master erred in finding that the proposed evidence was irrelevant.
Ground 4 is that, as a result of the error alleged in ground 3,[39] the acting master erred in law in failing to take into account a material consideration when determining the summary judgment application.
[39] The amended grounds of appeal filed 12 August 2024 refer to ground 2 instead of ground 3, but this was a typographical error - see appeal ts 2.
Ground 5 alleges that the errors alleged in grounds 2 ‑ 4 vitiated the acting master's exercise of discretion to make an order for summary judgment, and the exercise miscarried.
As we would uphold grounds 1.2 and 1.3, we will deal with them first.

Ground 1.2 - was the construction of cl 2 determinative?

By ground 1.2, Threadgold contends that, even assuming that it was untenable to construe cl 2 as obliging Staunton to cause the removal of sand, there were pleaded causes of action that did not depend upon that construction. Threadgold contends that neither its claim for damages nor its claim for a declaration was founded on any obligation on Staunton to cause the removal of sand.

Staunton contends that the acting master was correct to find that, for Threadgold to succeed, it had to show that Staunton was obliged to cause the removal of sand from the land. In essence, Staunton asserts that all of the relief sought by Threadgold in its statement of claim was founded on its pleaded allegation that Staunton was obliged to cause the removal of sand.

Staunton submits that, in order to substantiate any enforceable right to receive revenue from the removal of sand, Threadgold had to plead the source of its enforceable right. It submits that Threadgold sought to do this by pleading[40]
1.at paragraph 9(a), that the parties had entered into a Revenue Sharing Agreement concerning 'the sand the subject of the Sand Removal Agreement (that is, the sand located on the part of the land identified in development approval application 20/0437)';
2.at paragraph 9(f), that the parties had agreed 'the Defendant would cause the removal of the specified sand from the land';
3.at paragraph 9(g), that the parties had agreed the specified sand would be sold by the Respondent 'to APH, pursuant to the Sand Removal Agreement' or alternatively 'in the event the Sand Removal Agreement was not or ceased to be operative, on the best commercial terms available to a third party on an arm's length basis'; and
4.by paragraph 12(c), that under the Sand Removal Agreement, APH had agreed that 'subject to the development approval and the clearing permit being obtained, APH would during the period provided for sand removal under the Sand Removal Agreement remove the specified sand from the land'.
[40] Respondent's submissions [4] WAB 30 - 31.

Staunton submits that Threadgold's case was therefore pleaded on the basis that it had a right to specific performance and declaratory relief of an agreement by Staunton to 'cause' APH to remove sand it had promised to remove. It submits that the acting master was therefore correct to find that Threadgold's pleaded case required her to determine whether the Revenue Sharing Agreement imposed such an obligation on Staunton.
Staunton submits that, having found that there was no such obligation, the acting master was correct to grant summary judgment. It says that, if the Revenue Sharing Agreement did not impose that obligation on Staunton, Threadgold had no enforceable right to ground its prayer for relief for declarations as to the currency and effect of the Revenue Sharing Agreement.[41]
[41] Respondent's submissions [7].
Staunton submits that Threadgold cannot maintain proceedings in the hope that a cause of action might accrue in the future.[42]

Damages claim relating to the clearing permit

[42] Respondent's submissions [19]. See also respondent's submissions [31].

Staunton's submissions overlook those parts of the statement of claim in which Threadgold pleaded the alleged breaches of the Revenue Sharing Agreement that related to the clearing permit. That pleading is contained in paragraphs 16 ‑ 24 of the statement of claim, set out above. By those paragraphs, Threadgold alleged, in effect:
(1)In breach of the Revenue Sharing Agreement, Staunton hindered Threadgold's efforts to obtain the clearing permit (and, when the permit was not obtained within the 13-month period stipulated in the Revenue Sharing Agreement, Staunton had then wrongly asserted that it was therefore relieved of its obligations under that agreement).
(2)The acts of hinderance were varied and occurred repeatedly in the period from 20 April 2022 to 11 November 2022.
(3)Threadgold submits that these acts breached Staunton's obligations to act in good faith, cooperate and use reasonable endeavours, as pleaded in the statement of claim paragraphs 9(l), 9(m) and 9(n), read with 9(a), 9(b), 9(c), and 9(k).[43]
(4)But for Staunton's breaches, the clearing permit would have been granted and extraction of the sand could have commenced on or about 1 July 2022.
(5)Threadgold was thereby deprived of the opportunity of sharing in revenue from the sand.
(6)Threadgold was entitled to damages for the lost opportunity.
[43] Appeal ts 4, 9 - 10.
To succeed at trial on this pleading, Threadgold did not need to prove that, upon a proper construction of the Revenue Sharing Agreement, Staunton was obliged to cause the removal of sand.
During the hearing of the appeal, Staunton submitted that the clearing permit was irrelevant, because APH had refused to remove sand. Staunton submitted, in effect, that it did not matter if it had breached the agreement so as to prevent the clearing permit being obtained, because sand was not going to be removed in any event.[44]
[44] See appeal ts 23 - 24, 26 - 27.
The first difficulty with this contention is that the acting master did not find that, because APH had refused to remove sand, there was not a triable issue in relation to the claim for damages. Rather, she granted summary judgment on the erroneous basis that Threadgold's entire case depended on its contention that the agreement obliged Staunton to cause sand to be removed.
The second difficulty is that the damages claim is for the loss of the opportunity to receive payment from the removal of sand under the Revenue Sharing Agreement.
To be entitled to damages, Threadgold needed only to establish at trial that there was a more than merely speculative chance that, had the breach not occurred, it would have received payment under the Revenue Sharing Agreement.[45] To be entitled to summary judgment, Staunton had to establish to a high degree of certainty that Threadgold could not have done this.
[45] Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332, 350.
Staunton did not establish this. The fact that APH thought in October 2022 that it would be commercially unattractive to remove sand under the conditions of the original development approval did not necessarily mean that Threadgold could not establish at trial an entitlement to damages. Quantification of the claim for damages was a triable issue.

Claim for a declaration

Staunton submits that Threadgold's claim for a declaration was founded on its claim that Staunton was obliged to cause the removal of sand.
We do not accept this.
Paragraph A of the prayer for relief seeks a declaration that on a proper construction of the Revenue Sharing Agreement:
(a)A failure by the plaintiff to obtain the clearing permit within 13 months from the entry into the agreement does not relieve the defendant from its obligations to the plaintiff under the agreement;
(b)Further or alternatively in circumstances where the defendant did not make time of the essence a failure by the plaintiff to obtain the clearing permit within 13 months from the entry into the agreement does not relieve the defendant from its obligations to the plaintiff under the agreement;
(c)Further or alternatively the obligation upon the defendant to perform under the agreement has not been discharged;
(d)[A]t all times during its subsistence the defendant is honestly obliged to use all reasonable endeavours to remove the specified sand from the land; and
(e)The agreement between the plaintiff and the defendant remains on foot.
Of these subparagraphs, only A(d) relies on Staunton having an obligation to remove sand.
In relation to subparagraphs A(a) and (b), Threadgold relies on its pleading in paragraphs 16 ‑ 20 of the statement of claim that Staunton had hindered Threadgold's efforts to obtain the clearing permit. It submits this breached Staunton's obligations to act in good faith, cooperate and use reasonable endeavours, as pleaded in paragraphs 9(l), 9(m) and 9(n), read with paragraphs 9(a), 9(b), 9(c), and 9(k).[46]
[46] Appeal ts 4, 9 - 10.
Threadgold pleads in paragraph 21(a) of the statement of claim that Staunton wrongfully asserted that, if Threadgold did not obtain a clearing permit within 13 months of the Revenue Sharing Agreement, Staunton would be relieved of its obligations under that agreement. Threadgold pleads that this was, among other things, a breach of the agreement because it was Staunton's breaches of the agreement that prevented the clearing permit being obtained.[47]
[47] See appeal ts 10.
Paragraph A(c) of the prayer for relief is to similar effect.
Paragraph A(e) of the prayer for relief is, in essence, the ultimate declaration sought.
To succeed at trial on this claim, Threadgold did not need to prove that, upon a proper construction of the Revenue Sharing Agreement, Staunton was obliged to cause the removal of sand.

Conclusion on ground 1.2

Accordingly, ground 1.2 is made out. The appellant accepts that the error occurred due to the way the parties ran the case before the acting master.

Ground 1.3 - was there a real question to be tried as to whether the Revenue Sharing Agreement remained on foot?

By ground 1.3, Threadgold notes that it sought a declaration that the Revenue Sharing Agreement remained on foot and submits that there was therefore a real question to be tried.
As explained above, Threadgold's claim for the declaration did not depend on a construction that Staunton was obliged by cl 2 of the Revenue Sharing Agreement to cause the removal of sand.
The acting master, led into error by the way the case was conducted before her, did not consider whether there was a real question to be tried as to whether the Revenue Sharing Agreement remained on foot.
In Ainsworth v Criminal Justice Commission,[48] Mason CJ, Dawson, Toohey and Gaudron JJ described the scope of declaratory relief as follows:[49]
It is now accepted that superior courts have inherent power to grant declaratory relief. It is a discretionary power which '[i]t is neither possible nor desirable to fetter ... by laying down rules as to the manner of its exercise.' However, it is confined by the considerations which mark out the boundaries of judicial power. Hence, declaratory relief must be directed to the determination of legal controversies and not to answering abstract or hypothetical questions. The person seeking relief must have 'a real interest' and relief will not be granted if the question 'is purely hypothetical', if relief is 'claimed in relation to circumstances that [have] not occurred and might never happen' or if 'the Court's declaration will produce no foreseeable consequences for the parties'. (citations omitted)
[48] Ainsworth v Criminal Justice Commission [1992] HCA 10; (1992) 175 CLR 564.
[49] Ainsworth (581 - 582).
As a party to the Revenue Sharing Agreement, Threadgold has a real interest in whether it remained on foot. The question is whether the parties have existing rights and liabilities under the agreement. That question is not hypothetical. Threadgold does not rely on circumstances that have not occurred and might never happen. The only issue is whether the declaration would necessarily be refused on the basis that it would produce no foreseeable consequences for the parties and have no utility.

Foreseeable consequences?

Threadgold submits that Staunton did not establish that there was not a triable issue as to whether the declaration would have utility.
Threadgold submits that the declaration would have utility on two independent bases:[50]
(1)First because, as at the date the writ was issued, there was a dispute to quell as to whether the Revenue Sharing Agreement remained on foot. If it was on foot, Staunton would be obliged to assist Threadgold to obtain the clearing permit.
(2)Second because, if the agreement is still on foot, it is foreseeable that sand will be removed before the agreement expires on 26 November 2026.
[50] Appeal ts 11.
In our view, there was a triable issue as to whether the declaration would have foreseeable consequences on the first basis.
In relation to the second basis, Threadgold submits that it is bolstered by the proposed evidence it sought to adduce before the acting master.
As noted above, in the hearing before the acting master, Staunton adduced evidence of emails from APH sent in late 2022 in which APH said that it would not be commercially attractive to take sand from the land under the conditions of the original development approval, due to the limited number of truck movements (24) permitted under that approval, and that it would be more effective to source the sand elsewhere unless the conditions were changed.[51] The acting master found that APH did not exercise its right to remove the specified sand because it did not consider that removal of the sand was commercially viable under the conditions of the original development approval.
[51] See GAB 106 ‑ 116.
That finding is not challenged by Threadgold in this appeal. Nevertheless, we do not accept that this meant that there was not a triable issue as to whether the declaration would have foreseeable consequences.
The acting master's finding was to the effect that, in October 2022, APH considered that it would not be commercially viable to remove sand if only 24 truck movements were permitted, having regard to variables that went into the calculation (the loading costs incurred by APH and the revenue it would receive from delivering the product to clients).[52]
[52] See GAB 106.
This finding did not foreclose the possibility that, before the Revenue Sharing Agreement expired, the variables would change so that it became commercially viable to remove sand, even if the conditions of the development approval were not amended to increase the truck movements.

Further, it did not foreclose the possibility that, before the Revenue Sharing Agreement expired, the conditions would be amended to increase the truck movements to the point where it would be commercially viable to remove sand, even if the variables did not change. The statement of claim encompasses the removal of sand under an amended development approval.[53] Staunton does not contend that Threadgold's entitlement to share in revenue under the Revenue Sharing Agreement is limited to sand removed under the original development approval. That is, Staunton does not contend that Threadgold's entitlement does not extend to sand that might be removed under an amended development approval.[54]
[53] See statement of claim par 9(a) and appeal ts 16 - 17. Staunton did not contend otherwise.
[54] See the respondent's submissions in reply to the appellant's submissions as to notice of contention, filed 7 May 2025 (respondent's supplementary submissions) [11] - [13], [17], [19(a) ‑ (b)]. Further, Staunton does not contend that the original development approval did not satisfy the condition in cl 1(a) of the Revenue Sharing Agreement that all approvals be obtained within 13 months of the agreement - see respondent's supplementary submissions [1] (read with [1.1] of the appellant's submissions as to notice of contention, filed 24 April 2025 (appellant's supplementary submissions)).
APH's decision was made on the basis of the conditions imposed by the original development approval and the variables that existed as at October 2022. The Revenue Sharing Agreement did not expire for another four years.
In our view, this is sufficient to give rise to a triable issue as to whether the declaration as to the existence of continuing rights under the Revenue Sharing Agreement would have foreseeable consequences.
As noted above, Threadgold sought leave to reopen its case and adduce the proposed evidence, before the acting master made her decision.
The proposed evidence showed that on 18 October 2023, on Staunton's application and with APH's active support, the City of Busselton amended the original development approval to, relevantly, increase the number of truck movements permitted per day from 24 to 70.[55] It appears that APH would consider that this would be sufficient to make sand removal commercially viable.[56]
[55] Appellant's submissions [46] ‑ [47]; GAB 129, 130 (showing that Warwick Kindt spoke in support of the officer recommendation at a council meeting. Mr Kindt was a representative of APH - see GAB 106 - 116), 137 - 141 (in particular, condition 4.4 at GAB 140), 141 - 151 (setting out the officer recommendation, and see, in particular, GAB 145E).
[56] GAB 106D, 145E.
The acting master refused the application to adduce the proposed evidence on the ground that it was irrelevant to the question of whether cl 2 of the Revenue Sharing Agreement obliged Staunton to remove sand. The acting master was correct to conclude that the evidence was irrelevant to that question. As the parties had conducted the hearing on the basis that the application for summary judgment turned on that question, the acting master's refusal of the application to adduce the evidence was to be expected.
The proposed evidence was, however, relevant to whether a declaration could have foreseeable consequences. The evidence is such that it cannot be said with a high degree of certainty that APH would not remove sand from the land under the amended development approval.
Accordingly, there was a triable issue as to whether the declaration would produce foreseeable consequences on each basis advanced by Threadgold.

Conclusion on ground 1.3

Accordingly, ground 1.3 is made out. Again, the appellant accepts that the error occurred due to the way the parties ran the case before the acting master.

Appeal should be allowed

None of the remaining grounds of appeal challenge the acting master's conclusion that the contention that Staunton was obliged to cause the removal of sand was not arguable. Further, we agree with the acting master's conclusion, for the reasons she gave, that cl 2 did not impose such an obligation on Staunton.
The success of grounds 1.2 and 1.3 means that, subject to the notice of contention, the acting master's decision to uphold Staunton's application for summary judgment should be set aside, at least insofar as it applies to causes of action which did not depend on Threadgold's contention that Staunton was obliged by cl 2 to cause the removal of sand (paragraph 9(f) of the statement of claim).
Accordingly, subject to the notice of contention, we would allow the appeal on grounds 1.2 and 1.3, and substitute an order for summary judgment to Staunton in relation to the claim for relief for breach of the asserted contractual term that Staunton was obliged to cause the removal of sand, and would otherwise dismiss the application for summary judgment.

Remaining grounds of appeal

Given the above conclusion, it is unnecessary to deal with the remaining grounds. However, we observe that, to the extent that the acting master made any of the alleged errors, such errors could only have arisen due the way the parties argued the application for summary judgment.
The matters that ground 2 asserts should have been found by the acting master were irrelevant to the question of whether cl 2 of the Revenue Sharing Agreement obliged Staunton to remove sand.
The proposed evidence the subject of grounds 3 and 4 was irrelevant to that question.
Ground 5 depended on the establishment of at least one of grounds 2, 3 or 4.

Notice of contention

At the hearing of the appeal, Threadgold developed its argument to the effect that its pleadings disclosed alternative causes of action that did not depend on Staunton being obliged to remove sand from the land. The detail of that argument went beyond what could be discerned from its written submissions. As a result, Staunton was given leave during the hearing to file a notice of contention in the following terms:
If it is found that the Learned Master erred in failing to consider other causes of action arising from the pleaded case of the Appellant, the decision should be upheld because:
(a)the evidence did not disclose an arguable fact to support any alternative cause of action; and
(b)the Appellant did not contend what other causes of action remained open and arguable as pleaded, on the evidence before the Court.

Paragraph (a) - the evidence did not disclose an arguable fact

Staunton's submissions in support of the notice of contention are not entirely clear.
In particular, at times Staunton appears to contend that Threadgold was required to establish that APH had elected, prior to the issue of the writ, to exercise its right to remove sand.[57] In other submissions, Staunton appears to contend that Threadgold was required to establish that APH would make that election in the future.[58] For this reason, we will treat these contentions as being made in the alternative.

False premise

[57] See the respondent's supplementary submissions [10], [13].

[58] See the respondent's supplementary submissions [9], [12], [13], but cf [19(c)].

Before dealing with the alternative contentions, we note that they are built upon a false premise. Staunton submits that, for the acting master to have committed error requiring correction on appeal, Threadgold must show that the declaratory relief sought was not hypothetical, and there was a genuine controversy on an issue before the court which fell to be determined.[59]
[59] Respondent's supplementary submissions [8].
This submission fails to appreciate that Staunton is seeking to uphold the acting master's decision under a notice of contention if error is established. It is for Staunton to establish, as asserted in paragraph (a) of the notice of contention, that the evidence did not disclose an arguable fact to support any cause of action that did not rely on the contention that Staunton was obliged to cause the removal of sand.

The first alternative

Doing the best that we can, Staunton's contentions on the first alternative appear to involve the following steps.
(1)Threadgold was required to establish that there was a triable issue that APH had elected, prior to the issue of the writ, to exercise its right to remove sand.[60]
(2)Staunton had adduced evidence[61] to show that APH had not made an election to exercise its right to remove sand, as at the date the writ was issued.[62]
(3)This discharged Staunton's onus, and shifted the evidentiary onus to Threadgold to demonstrate that there was a triable issue that APH had indeed elected to remove the sand.[63]
(4)The evidence sought to be adduced by Threadgold of the amendment to the development approval did not assist Threadgold because the proposed evidence did not go to APH's intention prior to the writ being issued.[64]
[60] See the respondent's supplementary submissions [10], [13], [19(c)].
[61] Being the 2022 emails, GAB 106 - 116.
[62] Respondent's supplementary submissions [11].
[63] Respondent's supplementary submissions [12].
[64] Respondent's supplementary submissions [19(c)].
We do not accept this.
The declaration sought was, in essence, that the Revenue Sharing Agreement remained on foot. The material facts required to give rise to a cause of action for the declaration were the facts that were alleged to establish that the Revenue Sharing Agreement remained on foot.
Threadgold's statement of claim pleaded the facts on which it relied to establish this. The pleaded facts asserted, in summary:
(1)The Revenue Sharing Agreement provides that it is subject to Threadgold procuring all required approvals within 13 months from the date of the agreement (so by 19 November 2022);
(2)In breach of the Revenue Sharing Agreement, Staunton had prevented Threadgold from obtaining the clearing permit by 19 November 2022 (and had then wrongly asserted that it was therefore relieved of its obligations under that agreement); and
(3)The fact that the clearing permit had not been obtained by 19 November 2022 did not mean that the Revenue Sharing Agreement was no longer on foot because, among other things,
(a)it was Staunton's breaches of the agreement that prevented the clearing permit being obtained within that period; and/or
(b)time was not of the essence.
Whether the Revenue Sharing Agreement remained on foot was in issue before the acting master.[65]
[65] In the hearing before the acting master, Staunton submitted that the Revenue Sharing Agreement was no longer on foot by, at the latest, 19 November 2022. See appeal ts 26, 28.
To be entitled to the declaration, Threadgold did not have to establish that APH had already elected to remove sand.
In the summary judgment application, it was for Staunton to establish that there was no triable issue as to whether the declaration should be granted. In our view, the evidence that, as at October 2022 (before the development approval was amended), APH did not intend to remove sand under the conditions of the original development approval did not establish that there was no triable issue.
On Threadgold's pleaded case, the Revenue Sharing Agreement would not expire until 26 November 2026. Even if the development approval had not been amended, there was no reason to conclude, for example, that the variables that went into a calculation of the commercial viability of the extraction of sand under the conditions of the development approval would not change before the agreement expired.
In any event, if the proposed evidence had been admitted, it would have established that there was a triable issue.

The second alternative

The second alternative fails for similar reasons. The steps of the second alternative appear to be as follows:
(1)Staunton discharged its onus by adducing evidence that showed that APH had not made an election to exercise its right to remove sand as at the date the writ was issued. There was then an evidentiary onus to Threadgold to demonstrate that there was 'some indication sufficient to give rise to a triable issue, that [APH] had evinced an intention to [elect to remove sand or to remove sand] in the near future'.[66]
(2)The evidence sought to be adduced by Threadgold of the amendment to the development approval was insufficient to discharge that onus.
(3)Threadgold did not argue, or amend its pleading, to contend that the mere issue of an amended approval by the City of Busselton was evidence of APH’s state of mind as to its intentions.
[66] Respondent's supplementary submissions [12].
We do not accept the first step. In the summary judgment application, it was for Staunton to establish that there was no triable issue as to whether the declaration would have foreseeable consequences. In our view, the evidence that, as at October 2022 (before the development approval was amended, and on the variables that then existed), APH did not intend to remove sand under the conditions of the original development approval did not establish this.
As to the second step, if the proposed evidence had been admitted, that evidence would have established that there was a triable issue as to whether APH would elect to, and would, remove sand.
As to the third step, Threadgold did argue that the proposed evidence showed that APH would now find the removal of sand to be commercially attractive.[67] Threadgold did not need to argue or plead that the 'mere issue' of the amended approval was evidence of APH's intention. This was not Threadgold's contention. Threadgold also relied on the fact that Warwick Kindt, a representative of APH, spoke in support of the amendment at a council meeting.[68]
[67] Plaintiff's outline of submissions in support of application for leave to reopen and to lead new evidence, filed 12 December 2023 [17].
[68] Plaintiff's outline of submissions in support of application for leave to reopen and to lead new evidence, filed 12 December 2023 [11].
Further, and in any event, even if Staunton had established that the evidence did not disclose an arguable case in relation to the claim for a declaration, whether APH had elected to remove sand was irrelevant to Threadgold's claim for damages for the loss of the opportunity to receive payment from the removal of sand under the Revenue Sharing Agreement. Staunton did not establish to a high degree of certainty that there was not a more than merely speculative chance that, had the breach not occurred, Threadgold would have received payment under the Revenue Sharing Agreement.
We note that Staunton's submissions in support of the notice of contention did not deal with this cause of action.

Conclusion on paragraph (a)

For these reasons, we would reject paragraph (a) of the notice of contention.

Paragraph (b)

Paragraph (b) of the notice of contention asserts that Threadgold 'did not contend what other causes of action remained open and arguable as pleaded, on the evidence before the Court'.
Staunton's submissions did not address paragraph (b) of the notice of contention at all.
We would infer that paragraph (b) is intended to be a contention that Threadgold did not identify other causes of action in the hearing before the acting master. We would further infer that this is intended to ground a contention that Threadgold should not be permitted to advance a new case on appeal.
The general principles relating to the exceptional cases in which a party may advance a new case on appeal are well known and need not be repeated here. In short, a party may advance a new case on appeal where the interests of justice 'require it' and such a course can be taken without prejudice to the other party.[69]
[69] Zerjavic v Chevron Australia Pty Ltd [2020] WASCA 40 [65] - [67].
In this case, the appeal was against the summary dismissal of the claim, not an appeal from a decision on the merits. Further, the decision turned on a point of pleading. The new case sought to be advanced is as to the causes of action that arose under that pleading. Had this case been run at first instance, it could not possibly have been met by calling evidence. In any event, in seeking defendant's summary judgment under O 16 the onus was on Staunton to establish that there was no real question to be tried on any cause of action pleaded by Threadgold.
Therefore, this is a case where the appellant should be permitted to advance a new point in the appeal. That said, its failure to raise the point at first instance may be relevant to the appropriate costs orders to be made.
We would therefore reject paragraph (b) of the notice of contention.

Further submissions and application to adduce evidence

On 6 June 2025, after the court had reserved its decision, Threadgold filed an application in an appeal seeking leave to adduce evidence in the appeal. Threadgold sought to adduce, in the appeal, the evidence it had sought to adduce before the acting master. We would refuse the application as it is unnecessary given that the 'additional evidence' to which the application relates was material sought to be placed before the master. In any event, we have concluded that the master was correct to refuse leave to the appellant to adduce that evidence.
On the same day, Threadgold also lodged further written submissions, said to be in reply to Staunton's written submissions on the notice of contention. The submissions were not accepted for filing as they were filed after judgment in the appeal was reserved and no provision was made for them in the orders permitting the filing of further written submissions.[70]
[70] As to which, see Frigger v The State of Western Australia [2025] WASCA 7 [212] - [213].

Conclusion

For these reasons, we would dismiss the notice of contention, allow the appeal and set aside the acting master's decision.
We would, however, grant summary judgment to Staunton in relation to the claim for relief for breach of the asserted contractual term that Staunton was obliged to cause the removal of sand. In our view, for the reasons given by the learned acting master, Threadgold's contention that, under the Revenue Sharing Agreement, Staunton was obliged to cause the removal of sand was not arguable.
We would otherwise dismiss the application for summary judgment.
We would dismiss Threadgold's application in an appeal filed 6 June 2025.

We would hear from the parties as to costs. However, our preliminary view is that the parties should bear their own costs of the appeal. Even though the appellant has been successful, it succeeded on a basis that it did not put to the acting master. Had the appellant addressed the points raised before this court with the acting master it is likely that the appeal would not have been required. Further, our preliminary view is that we would not interfere with the acting master's order that Staunton should have its costs of the summary judgment application. Threadgold has not disturbed the order for summary judgment in full. And, as explained, Staunton was - and remains - wholly successful on the constructional issue that was litigated before the acting master.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
ADR
Associate to the Honourable Justice Archer
13 JUNE 2025

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Threadgold Architecture Pty Ltd v Staunton Developments Pty Ltd [2025] WASCA 88

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