Western Export Services Inc v Jireh International Pty Ltd [2011] HCA 45

HIGH COURT OF AUSTRALIA

GUMMOW, HEYDON AND BELL JJ

WESTERN EXPORT SERVICES INC & ORS APPLICANTS

AND

JIREH INTERNATIONAL PTY LTD RESPONDENT

Western Export Services Inc v Jireh International Pty Ltd [2011] HCA 45

28 October 2011

S227/2011

ORDER

Special leave to appeal refused with costs.

On appeal from the Supreme Court of New South Wales

Representation

B W Walker SC with G K J Rich for the applicants (instructed by Koffels Pty Limited)

R Merkel QC with T Maltz for the respondent (instructed by Meerkin & Apel Lawyers)

Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

Western Export Services Inc v Jireh International Pty Ltd

Precedents – High Court – Statements of principle binding upon intermediate appellate courts and trial courts until reconsidered by High Court.

Contract law – Contractual construction – Whether essential to identify ambiguity in language of contract before court may have regard to surrounding circumstances and object of transaction.

Words and phrases – "ambiguity", "binding", "High Court", "precedents".

1. GUMMOW, HEYDON AND BELL JJ. This is an application for special leave to appeal from a decision of the New South Wales Court of Appeal[1], in which Macfarlan JA gave the leading judgment. The dispute concerned the construction of cl 3 of a "Letter of Agreement" concerning the franchising in Australia of Gloria Jean's Gourmet Coffee Stores. In the passage[2] in which he found error in principle in the reasons of the primary judge, his Honour said:

"A court is not justified in disregarding unambiguous language simply because the contract would have a more commercial and businesslike operation if an interpretation different to that dictated by the language were adopted."

His Honour added[3] that the primary judge appeared: