Findex Group Limited v McKay [2020] FCAFC 182

FEDERAL COURT OF AUSTRALIA

Findex Group Limited v McKay [2020] FCAFC 182 Appeal from: Findex Group Limited v McKay [2019] FCA 2129

File number(s): NSD 72 of 2020

Judgment of: MARKOVIC, BANKS-SMITH AND ANDERSON JJ

Date of judgment: 29 October 2020

Catchwords: PRACTICE AND PROCEDURE – whether the appellants sought to advance submissions not advanced below and which depart from the manner in which the case was run before the primary judge – arguments now put by the appellants on appeal raise matters not developed to same extent below – no objection to appeal in respondent's written submissions – no prejudice to first respondent if appellants permitted to advance arguments on appeal – appeal arguments concern questions of law and raise no new facts – expedient and in the interests of justice to entertain arguments put on appeal CONTRACTS – restraint of trade provision in a shareholders agreement – whether the primary judge erred by failing to give restraint of trade clause a "commercial construction" – principles relating to the interpretive task – on a proper interpretation, the primary judge's interpretation was not erroneous – Court must give effect to the unambiguous terms used by the parties – there is no power to remake or amend the contract to avoid a result which is considered to be inconvenient or unjust – commercial common sense not to be invoked retrospectively – mere fact of an undesirable result is no reason to depart from the natural language of the agreement CONTRACTS – whether the primary judge's interpretation was erroneous in that it failed to appreciate that the restraint of trade provision contained separate groups of restraints by "Covenantors" and "Affiliates" – the primary judge's construction contains no such error – the appellants' interpretation approaches the question of construction with the benefit of hindsight, and not as at the date of the restraint's creation – text and structure of restraint's chapeau does not indicate independent and separate restraints as contended by the appellants – appellants' proposed interpretation inconsistent with another clause in shareholders agreement, cl 20.5 CONTRACTS – severance – principles relating to severance – whether a part of the chapeau to the restraint of trade provision can be severed in manner contended by the appellants – severance not possible in manner advanced by the appellants – part of the chapeau to the restraint of trade provision cannot be severed consistently with principles relating to severance CONTRACTS – enforceability – whether the restraint of trade provision is valid and enforceable – the primary judge did not fail to properly construe the restraints – primary judge was correct to conclude that the restraints are not enforceable because they are unreasonable