Victoria v Tatts Group Ltd

Case [2014] VSCA 311


SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2014 0075

STATE OF VICTORIA
v
TATTS GROUP LIMITED (ACN 108 686 040)

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JUDGES: NETTLE, OSBORN and WHELAN JJA
WHERE HELD: MELBOURNE
DATE OF HEARING: 14 October 2014
DATE OF JUDGMENT: 4 December 2014
MEDIUM NEUTRAL CITATION: [2014] VSCA 311
JUDGMENT APPEALED FROM: [2014] VSC 302 (Hargrave J)

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STATUTORY INTERPRETATION – Gambling Regulation Act 2003 (Vic) – Gaming operator’s licence – Regulatory regime changed – Ability to issue further gaming operator’s licence abolished – New species of authorisation called gaming machine entitlements created and issued – Appellant’s gaming operator’s licence expired – Whether appellant entitled to terminal payment under s 3.4.33 – Entitlement to terminal payment on grant of gaming operator’s licence to person other than former licensee or a related entity – Specific meaning of gaming operator’s licence adopted as representing connected and combined statement of the will of Parliament – Statutory purpose to make clear the appellant has not and never has had anything more than right to payment when and if a gaming operator’s licence as defined in s 1.3 (‘gaming operator’s licence issued under Part 4 of Chapter 3’) issues to someone other than the appellant – No entitlement to terminal payment – Conclusion of trial judge upheld – Appeal dismissed.

CONTRACT – Agreement as to grant of gaming operator’s licence – Compensation payable under cl 7 on expiry of licence without ‘a new gaming operator’s licence’ having issued – Regulatory regime changed – Ability to issue further gaming operator’s licence abolished – New species of authorisation called gaming machine entitlements created and issued – Whether ‘a new gaming operator’s licence’ issued for purposes of cl 7 – Intention of parties objectively discerned that ‘a new gaming operator’s licence’ would extend to a new licence or new licences substantially the same as existing licence – Essential core functional value of gaming operator’s licence and gaming machine entitlement to carry on gaming operations – Aggregate of rights conferred on licence and entitlement holders substantially and relevantly the same for the purposes of this enquiry –Appellant entitled to compensation – Conclusion of trial judge upheld – Appeal dismissed.

CONTRACT – Letter from Treasurer to appellant’s predecessor – Enumerated principles on which Government reaching agreement over grant of gaming operator’s licence – One principle dealt with terminal payment – Letter annexed to agreement – Express good faith term in performance of Agreement – Implied cooperation term to enable appellant’s predecessors to have benefit of agreement – Content of terms circumscribed by express statement that entitlement to terminal payment subject to contrary executive and legislative action – Alternative to claim under cl 7 of agreement – Failure to treat allocation of gaming machine entitlements as constituting the issuing of ‘new gaming operator’s licences’ within meaning of cl 7 of agreement cannot constitute breach – Failure to ensure issue of gaming machine entitlements did not have effect of depriving appellant of terminal payment cannot constitute breach – Conclusion of trial…

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Victoria v Tatts Group Ltd [2014] VSCA 311
Case
[2014] VSCA 311
Decision Date

CaseChat Overview and Summary

The appellant, Victoria, brought an appeal against the respondent, Tatts Group Ltd, regarding various claims following the expiry of its gaming operator’s licence. The Court of Appeal of the Supreme Court of Victoria was tasked with resolving issues of statutory interpretation and contract law arising from the Gambling Regulation Act 2003 (Vic) and associated agreements.

The court was required to determine whether the appellant was entitled to a terminal payment under section 3.4.33 of the Act when its gaming operator’s licence expired and the ability to issue new licences was abolished, replaced by gaming machine entitlements. Additionally, the court needed to ascertain if the appellant was entitled to compensation under a contract clause when a new gaming operator’s licence was not issued, and whether the government’s failure to ensure the appellant received a terminal payment constituted a breach of the contract.

The court held that the statutory language and the legislative purpose made it clear that the appellant had no entitlement to a terminal payment beyond the right to payment when a new gaming operator’s licence, as defined, was issued to another party. The court also found that the essential functional value of the new gaming machine entitlements was substantially the same as the old gaming operator’s licence, thus satisfying the contract’s requirement for a new licence. Furthermore, the court concluded that the failure to treat the allocation of gaming machine entitlements as issuing new licences did not constitute a breach of contract, as the entitlement to a terminal payment was expressly subject to contrary executive and legislative action.

The appeal was dismissed in its entirety, upholding the conclusions of the trial judge.

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