Reported Decision : 62 ACSR 539 (2007) Aust Contract Reports 90-258 New South Wales Supreme Court CITATION : Silver v Dome Resources NL [2007] NSWSC 455 HEARING DATE(S) : 4 – 8, 11 - 15 April, 3 & 5 May and 12 – 14 September 2005, 9, 13 & 22 June, 26 October and 6 December 2006 and 2 May 2007 JUDGMENT DATE : 9 May 2007 JURISDICTION : Equity JUDGMENT OF : Hamilton J DECISION : That the first plaintiff is entitled to orders for specific performance to enforce the payment of benefits upon his retirement as a director to a company associated with him against both the company from which he retired and its holding company as guarantor. CATCHWORDS : CONTRACTS [45], [87] – General contractual principles – Parties – Rights and liabilities of third parties – Enforcement by non party beneficiary – Consideration – What amounts to consideration – Other cases – Practical benefit or disbenefit - CORPORATIONS [1228], [1241] – Management and administration – Officers of corporation – Director – Remuneration – Responsibility for fixing – Authority, rights and powers of officers of corporation – Termination payments – Entitlements on resignation – Statutory caps on quantum – Time of operation of provision prohibiting excessive entitlements - EQUITY [379] – Equitable remedies – Specific performance – The jurisdiction in general – General principles – No longer limited by particular categories – Available at suit of party to contract to enforce payment of monetary sum to non party - GUARANTEE AND INDEMNITY [20] – Discharge of surety – Departure from terms of contract with surety – Whether total failure of consideration. Corporations (New South Wales) Act 1990 s 7 Corporations Act 1989 (Cth) s 82 LEGISLATION CITED : Corporations Law ss 9, 124, 125, 127, 128, 129, Part 2D.2 Division 2, 200A(1)(b), 200B(1), 200D(1), 200G(1)(b), 200G(2)(b), 237 and 251A(6) Corporations Act 2001 (Cth) ss 9, 124, 125, 127, 128, 129, Part 2D.2 Division 2, 200A(1)(b), 200B(1), 200D(1), 200G(1)(b), 200G(2)(b) and 251A(6) Trade Practices Act 1974 (Cth) s 52 Ajax Cooke Pty Ltd v Nugent SCV Phillips J 29 November 1993 unreported Anangel Atlas Compania Naviera SA v Ishikawajima-Harima Heavy Industries Co Ltd (No. 2) [1990] 2 Lloyd's LR 526 Barroora Pty Ltd v Provincial Insurance Ltd (1992) 26 NSWLR 170 Berry v Federal Commissioner of Taxation (1953) 89 CLR 653 Beswick v Beswick [1968] AC 58 Chan v Cresdon Pty Ltd (1989) 168 CLR 242 Chappell & Co Ltd v Nestlé Co Ltd [1960] AC 87 Claremont Petroleum NL v Cummings (1992) 110 ALR 239 Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 Co-operative Bulk Handling Ltd v Jennings Industries Ltd (1996) 17 WAR 257 Coulls v Bagot's Executor & Trustee Co Ltd (1967) 119 CLR 460 Fox v GIO Australia Ltd (2002) 56 NSWLR 512 Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1 Gobblers Inc Pty Ltd v Stevens (1993) 6 BPR 13,591 Haddad v R W Jordan Pty Limited FCA 20 August 1997 unreported Jefferys v Jefferys (1841) Cr & Ph 138; 41 ER 443 Lee v GEC Plessey Telecommunications [1993] IRLR 383 Lilley v Midland Brick Co Pty Ltd (1992) 9 WAR 339 Mizzi v Reliance Financial Services Pty Ltd [2007] NSWSC 37 Musumeci v Winadell Pty Ltd (1994) 34 NSWLR 723 Orrong Strategies Pty Ltd v Village Roadshow Limited [2007] VSC 1 Pao On v Lau Yiu Long [1980] AC 614 CASES CITED : Queensland Bacon Pty Ltd v Rees (1966) 115 CLR 266 Re Heaney; Ex parte Flint v Nexus Minerals NL WASC Full Court 26 February 1997 unreported Sali v SPC Ltd (1991) 9 ACLC 1511 Scott v Forster Pastoral Co Pty Ltd (2000) 35 ACSR 294 Stilk v Myrick (1809) 2 Camp 317; 170 ER 1168 Thomas v Thomas (1842) 2 QB 851; 114 ER 851 Tinyow v Lee [2006] NSWCA 80 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 Whitlam v Insurance Australia Group Limited (2005) 52 ACSR 470 Wigan v Edwards (1973) 47 ALJR 586 Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1 Wilson v Northampton and Banbury Junction Railway Co (1874) LR 9 Ch App 279 Woodar Investment Development Ltd v Wimpey Construction UK Ltd [1980] 1 WLR 277 Woodhouse AC Israel Cocoa Ltd SA v Nigerian Produce Marketing Co Ltd [1972] AC 741 Woodside Petroleum Development Pty Ltd v H&R-E&W Ltd (1997) 18 WAR 539 Accounting Standard AASB 1017 of February 1997 Accounting Standard AASB 1046 of January 2004 Carter, Peden and Tolhurst, Contract Law in Australia (5th ed, 2007) [6-23], [6-27], [6-41], [6-44], [6-48] Macquarie Dictionary (4th ed, 2005) Meagher, Gummow and Lehane, Equity: Doctrines and Remedies (4th ed, 2002) [20-025], [20-030], [20-050] O'Donovan and Phillips, The Modern Contract of Guarantee (looseleaf) [2.1000], [2.1050], [2.1100] Rowlatt on Principal and Surety (5th ed, 1999) [2 01], [2-11] Shorter Oxford English Dictionary (5th ed, 2002) Michael Bernard Silver (P1 & XD1) PARTIES : Fair Choice Limited (P2 & XD2) Dome Resources NL (D1 & XC1) Durban Roodepoort Deep Limited (D2 & XC2) FILE NUMBER(S) : SC 2586/01 COUNSEL : J E Thomson & M J Watts (Ps) T G R Parker SC (Ds) SOLICITORS : Bull, Son & Schmidt (Ps) Allens Arthur Robinson (Ds) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION HAMILTON J WEDNESDAY, 9 MAY 2007 2586/01 MICHAEL BERNARD SILVER & ANOR v DOME RESOURCES NL & ANOR JUDGMENT HIS HONOUR: Item Par Introduction 1,2 The facts 3 – 49 Witness credit 50 – 54 The corporations legislation 55 Contentions 56, 57 1 Authority of directors 58 – 77 1.1 Resolution authorising retirement variation deed 59 – 65 1.2 Authority of Dome directors re retirement deed 66 – 70 1.3 Authority of Dome directors re retirement variation deed 71 - 73 1.4 Operation of corporations legislation ss 124, 125 74, 75 1.5 Operation of corporations legislation ss 128, 129 76, 77 2 Interpretation of restrictions on retirement benefits: what is prohibited and when 78 – 109 2.1 The relevant legislative provisions 79 – 81 2.2 Time of operation of Part 2D.2 Division 2 82 – 87 2.3 Are the payment obligations prohibited by s 200B(1) 88 2.4 Does the exception to the prohibition in s 200G(1)(b) apply? 89 – 108 2.4.1 Is payment "for past services"? 89 2.4.2 Would payment exceed payment limit in the Corporations Act 2001 (Cth) s 200G(2)(b)? 90 – 108 2.5 Whether, if the payment limit is exceeded, the varied retirement deed may be read down so as to oblige payment of an amount equal to the payment limit 109 3 Entitlement of the plaintiffs to recover a judgment at law 110 – 116 4 Possibility of relief by way of specific performance 117 – 148 4.1 Specific performance of an obligation to pay money 118 – 120 4.2 Entitlement to specific performance against Dome 121 – 138 4.3 Entitlement to specific performance against DRD 139 – 148 5 Estoppel 149 6 The claims under the Trade Practices Act 1974 (Cth) 150 Conclusion 151 Introduction 1 These proceedings are brought, as first plaintiff, by a former director ("Mr Silver") of a company (the first defendant) and, as second plaintiff, by a company associated with Mr Silver ("Fair Choice"). They are brought to enforce payment promised upon Mr Silver's retirement as a director under a retirement deed ("the retirement deed") executed by the first defendant ("Dome"). The retirement deed was varied by a deed of variation ("the retirement variation deed"), which inserted new provisions in the retirement deed and also provided a guarantee by the second defendant ("DRD") of Dome's obligations. The retirement deed as varied by the retirement variation deed is referred to as "the varied retirement deed". The obligations to pay under the varied retirement deed are referred to as "the payment obligations". Dome was a company listed on the Australian Stock Exchange until it was taken over by DRD. DRD is a South African company, which was and is listed on the Johannesburg Stock Exchange. It was on 15 February 1999 registered as a foreign company under Part 5B.2 Division 2 of the corporations legislation and has continued so registered. 2 The defendants resist these claims upon various grounds. Those grounds include grounds relating to the signatories' authority to execute the deeds; that the payments were prohibited by provisions of the corporations legislation limiting termination payments to company directors except with the approval of a general meeting or general meetings; that neither the first defendant nor the second defendant is entitled to recover a judgment at law in respect of the failure to pay the retirement payments; and that the plaintiffs are not entitled to specific performance of the payment obligations because of lack of consideration for those obligations. The Facts 3 The facts set out under this heading appear from the evidence and, except as appears otherwise in this judgment, I find that they are established. 4 Mr Silver has, as a professional engineer, been involved in mining and the development of gold mines in both Australia and overseas since about 1970. His involvement has been through his own companies and as a director of or consultant to other companies. 5 In 1987, Mr Silver met Vincent Yu ("Mr Yu"), who lived in Hong Kong and thereafter assisted Mr Silver in dealings he had there. In early 1992, Mr Silver had a conversation with Mr Yu as follows: "Mr Silver: 'There are a number of opportunities to acquire interests in resource projects in Indonesia, the Philippines and other parts of Asia.' Mr Yu: 'I also know of opportunities in China.' Mr Silver: 'I suggest we set up a Hong Kong company to investigate and acquire such opportunities.' Mr Yu: 'I agree and if you like, I will incorporate a company here in Hong Kong for this purpose and would hold the shares on your behalf.' Mr Silver: 'That's good. I anticipate that from time to time organisations that provide finance or wish to invest in these opportunities would also seek a beneficial entitlement to some of the issued shares in Goldspark.' Mr Yu: 'Yes, that's understandable.'" 6 In about September 1992, Mr Silver was appointed a director of Goldspark Pty Limited ("Goldspark") and Mr Yu was the other director. Shares in Goldspark were issued to Mr Yu to be held on Mr Silver's behalf. In about 1994, further shares in Goldspark were issued, some in favour of parties unrelated to Mr Silver. After this, about 60% of the shares in Goldspark were held on behalf of Mr Silver. 7 On 6 April 1993 Mr Silver on behalf of Goldspark wrote a letter to John Boyer ("Mr Boyer") of Dome. The letter relevantly stated as follows: "This is to confirm that Goldspark expects that the services of Mr Michael Silver will be retained by Ballymore Ltd. in the development of the Tolukuma project. It is anticipated that M.B. Silver will be involved as part of the Supervisory and Management Team. …… Mr Silver would expect to spend approximately 75% of his overall time on this project. We suggest that in the initial phase of this project that is, until Dome Resources decides to either exercise or reject its option, that Mr Silver be retained at a figure of $6,000 per calendar month. … We look forward to participating with Dome Resources in what is expected to be a highly profitable mine development." 8 At about that time Mr Silver had a conversation with Mr Yu to the following effect: "Mr Silver: 'Vincent, I have arranged for the payment of a consulting fee of $6,000.00 in connection with the Tolukuma Gold Mine to be paid to Goldspark. I would like to access part of those funds from time to time for consulting services provided by me and expenses incurred by me. The balance of the funds would remain with Goldspark.' Mr Yu: 'Yes Michael. You are permitted to issue invoices on behalf of Goldspark and to access the funds paid in respect of your services when required.'" 9 So far as the evidence goes, there was no further written arrangement as to the provision of Mr Silver's services to Dome until the letter from Dome of 3 May 1999 referred to in [17] below. 10 From April 1993 Goldspark commenced to send invoices for work done by Mr Silver. The invoices were initially sent to Ballymore No 56 Pty Ltd, which was a subsidiary of Dome, then to Dome Resources (PNG) Pty Ltd, another subsidiary. The invoiced amount was variously described as for management services or consulting fees. 11 The services provided to Dome related primarily to the investigation, establishment, development and operation of a gold mine in Papua New Guinea ("PNG") at Tolukuma in the foothills of the Owen Stanley Ranges approximately 100 kilometres north of Port Moresby ("the Tolukuma project"). The services initially included arranging seed funding and initial equity participation in the Tolukuma project; coordinating consultants investigating the feasibility of mining at the Tolukuma site; negotiating with the PNG Government; dealing with the local PNG landowners and assisting in connection with the implementation of a landowners' compensation package; assisting with obtaining the necessary project finance; supervising prospecting services; and attending meetings of the "Tolukuma review committee". After the grant of the mining lease in mid 1994, the services included services relating to the retaining of contractors for and supervision of the design and construction of the mine plant leading up to the commissioning of the mine ("the Tolukuma mine") and commencement of operations in about December 1995. Once operations commenced, the consulting services included services relating to ongoing technical issues, liaison with landowners and operating staff, promotion of the mine overseas and the settlement of disputes. 12 As a result of the provision of these services, Mr Silver acquired a large body of knowledge, experience and contacts relevant to the Tolukuma project and the Tolukuma mine. 13 On 26 June 1998, Mr Silver was appointed a director of Dome. His appointment was announced to the Australian Stock Exchange as the appointment of a non executive director. Mr Silver deposed that from 26 June 1998 he served as an executive director of Dome. There was, of course, in force at that time an agreement between Dome and Goldspark concerning the provision of Mr Silver's consulting services to Dome. On the evidence, it does not seem that Mr Silver was at this time appointed as an executive director of the company under the provisions of the Constitution set out in [49] below. However, it is to be noted that he did from 26 June 1998 become an executive director of the company within the defined meaning contained in the retirement deed as set out in [22] below. 14 From about mid 1998 Mr Silver formed the view that his remuneration for his services to Dome was inadequate. He indicated in conversations with Mr Boyer, then the Executive Chairman of Dome, that he was not prepared to continue devoting significant time and effort as a consultant to Dome unless remuneration arrangements were improved. 15 Late in 1998, Mr Silver and Mr Boyer met at Dome's office in Sydney. During that meeting there was conversation to the following effect: "Mr Boyer: 'I intend to propose that the board approve an agreement where all the executive directors will receive a retirement benefit.' Mr Silver: 'What type of benefit would it be?' Mr Boyer: 'A payment would be made to each director such that on retirement we would each receive an amount equal to the total of fees paid by Dome to that director for the three year period preceding retirement'." It is to be noted that Mr Silver said that Mr Boyer proposed the approval of a retirement benefit for all "executive directors", which category was obviously intended to include Mr Silver. 16 In March or April 1999 there was a further conversation between Mr Silver and Mr Boyer as follows: "Mr Silver: 'I believe that the fee arrangement should change and that Dome should pay an additional monthly fee of $10,000.00 for my services, especially given the investment opportunities I have been working on and introducing to Dome.' Mr Boyer: 'OK, I am in agreement with that given your present level of involvement. From now on your services will also involve investigating acquisition and investment opportunities for Dome.'" 17 On 3 May 1999 Michael Hutt ("Mr Hutt"), a director of Dome, wrote to Goldspark care of Mr Silver as follows: "I am writing to confirm the Agreement between Dome Resources NL (Dome) and Goldspark Limited (Goldspark) for the provision of consulting services. 1 Goldspark agrees to provide the personal services of Michael Silver as a consultant to Dome for a minimum of half of the usual business days of each month. 2 Michael Silver will consult on any and all matters as required by Dome's Executive Chairman. 3 Michael Silver will consult in Sydney subject to the fact that he will occasionally be required to travel to the [sic] Dome's areas of operation. 4 Dome will pay a fee of $10,000.00 to Goldspark for each month's consultancy. Dome agrees to reimburse Goldspark for reasonable out of pocket expenses incurred on Dome's behalf." These arrangements in connection with consulting services provided by Mr Silver on behalf of Goldspark continued to apply (subject to the increase in fee referred to in the next succeeding paragraph) until Mr Silver ceased to be a director of Goldspark in about November 1999. 18 From about May 1999 to about May 2000 Dome paid $20,000.00 per month in connection with the consultancy services Mr Silver provided. The last payment made was $13,170 on 16 May 2000. 19 Some time after the discussion between Mr Silver and Mr Boyer about a retirement benefit set out in [15] above, Mr Silver received from Mr Hutt a document titled "Retirement Deed". At about that time, Mr Silver had a conversation with Mr Hutt to the following effect: "Mr Hutt: 'Michael, I have had discussions with John [Boyer] and Minter Ellison. I understand that it is agreed that all directors' fees paid to you and all payments made to Goldspark for your services for the three year period prior to your retirement will be taken into account in calculating the payment to be made on your retirement.' Mr Silver: 'Fine, that's how I understand it . '" 20 Before the directors met to resolve to execute the retirement deed Mr Silver had a conversation with Mr Hutt in words to the following effect: "Hutt: 'Michael I have had advice from Minter Ellison that the board of directors can approve the payment to be made under the retirement deeds. However, only the independent directors vote on the resolution to enter into the retirement deeds and this will require you, John Boyer and I to leave the meeting because we have an interest. I am advised by Minter Ellison that this course will avoid Dome incurring the costs of holding a shareholders meeting'." 21 At a meeting on 31 May 1999, the board of Dome, in Mr Silver's absence, approved the execution of the retirement deed, as recorded in minutes of a meeting of that date. The retirement deed bears date 31 May 1999. Mr Silver executed the retirement deed at about that time. He did not instruct lawyers to act for him in relation to it. Minter Ellison acted only for Dome. The affixing of Dome's common seal to the deed was witnessed by Mr Boyer and by Philip Kelso ("Mr Kelso"), who was also a director of Dome. 22 The retirement deed recited that Mr Silver was an executive director of the company. The deed in clause 1 defined "executive director" as "a director who spends a substantial part of his working time on the business of the company and who is remunerated by the company either directly or indirectly in addition to receiving director's fees". By clause 3 the retirement deed provided for the payment to Goldspark, on retirement of the director in circumstances which are no longer relevant because superseded by the provisions of the retirement variation deed, of an amount equal to "the total emoluments of the director during the period of three years ending on the date of his retirement … calculated in accordance with the formula in s 237(6)(b)(ii) of the Corporations Law …". 23 Mr Silver has deposed that he believed that Mr Kelso and Mr Boyer had been properly authorised to execute the retirement deed on behalf of Dome and that he had no reason to believe otherwise. He has also deposed that he did not at any time believe or understand that shareholders' approval was required before Dome could make a payment pursuant to the retirement deed. 24 Mr Silver has deposed that it was in reliance on his understanding of the retirement deed and on his discussions with Mr Boyer and Mr Hutt set out above that he remained as a director of Dome after 31 May 1999. He said that, if he had been of the view that the retirement deed did not secure a retirement payment calculated as represented to him by both Mr Boyer and Mr Hutt, he would have sought to put in place different arrangements with Dome. He believed that, because Dome was then anxious to secure his services, it would have been prepared to engage him to provide consulting services directly to it and would have been prepared to make the retirement payment under the deed payable to him and not to Goldspark. 25 Mr Silver has deposed that between 31 May 1999 and 26 May 2000 he provided consulting services to Dome. These services included advising upon the ongoing technical aspects of the operation and development of the Tolukuma mine; providing general ongoing technical support, including giving directions as to metallurgical work and metal trading; liaising with the local PNG land owners; attending meetings and making presentations in Australia, the UK and PNG to bankers lending in respect of the Tolukuma project; making presentations to brokers in connection with the promotion of the Tolukuma project; participating in personnel selection and attending meetings with Tolukuma mine personnel; attending discussions and meetings with suppliers to the mine; and attending meetings with consultants and other parties in relation to the exploration and expansion of the mine generally. 26 In mid September 1999 DRD acquired 19.91% of the shares and became a substantial shareholder in Dome. 27 On 27 September 1999 Mr Boyer retired as a director of Dome, Mr Silver was appointed managing director of Dome and Charles Mostert ("Mr Mostert") and John Stratton ("Mr Stratton") were appointed directors of Dome. Mr Mostert was at that time chief financial officer and a director of DRD. 28 In about November 1999 Mr Silver ceased to be a director of Goldspark and all of the shares in Goldspark including those held by him and by Mr Yu on his behalf were sold. At about that time he had a conversation with Mr Yu as follows: "Mr Silver: 'In view of the fact that we have disposed of Goldspark, I think that in order to continue to pursue investment opportunities overseas, that [sic] we should use another Hong Kong company to replace Goldspark.' Mr Yu: 'Yes I have another company in Hong Kong called Fair Choice which could be used. I am a director of this company together with a colleague of mine, Mr Ting Chan. My company, Wellwin Nominees Limited, is the secretary of Fair Choice.' Mr Silver: 'Yes, that would be good, you or your company can hold the shares in Fair Choice on my behalf.'" Mr Silver and Mr Yu also discussed the provision of consulting services to Dome by Fair Choice and the following was said: "Mr Yu: '… The same arrangements as before can apply. You are permitted to issue invoices on behalf of Fair Choice to Dome.'" 29 Mr Silver has deposed that, after these conversations with Mr Yu, he was able to access part of the funds of Fair Choice that flowed from his consulting efforts for the services provided by him and expenses incurred by him and that from time to time he received payment from Fair Choice of part of the funds paid to it by Dome in connection with the consulting services provided by him under the arrangements with Fair Choice. 30 Shortly after Mr Silver made the above arrangements with Fair Choice, he had a conversation with Mr Mostert at Dome's office in Sydney as follows: "Mr Mostert: 'Michael, I would like you to maintain an association with Dome and remain as a non-executive director. Your knowledge of Dome's business affairs is seen as important.' Mr Silver: 'Yes, I am prepared to continue as a director but this will require a change to my retirement deed, so that the retirement benefit will still be paid if I resign as a non-executive director for any reason. Also, like the present position, the retirement payment must be calculated by taking into account the fees paid to me as a director and the fees Dome has paid in relation to my consultancy services for the three years preceding the date of my retirement. That means payments to both Goldspark and Fair Choice must be taken into account. ' Mr Mostert: 'OK Michael, I understand and agree. I will arrange for a new version of your Retirement Deed to be prepared which attends to those matters and DRD will guarantee Dome's obligations under the Deed'." Mr Silver has deposed that it was in reliance on this last conversation with Mr Mostert that he continued to devote his services to Dome. 31 Shortly after that conversation, Mr Silver had a telephone conversation with Mr Yu to the following effect: "Mr Silver: 'Arrangements are now being made with Dome to change the retirement payment arrangement. Fair Choice will become the beneficiary rather than Goldspark. Once the payment is received do you agree that I will be entitled to invoice Fair Choice for the same amount? If you agree with this, I agree to assist Fair Choice in examining the feasibility of any Chinese projects as well as the one in Henan Province you are now investigating .' Mr Yu: 'Okay Michael.' Mr Silver: 'I will send you a copy of the draft agreement before it is executed.'" 32 After the conversation with Mr Mostert set out in [30] above, Mr Silver had a telephone conversation with Mr Hutt as follows: "Mr Hutt: 'I have been asked by Charles Mostert to make arrangements to have your Retirement Deed amended. I will arrange for Minter Ellison to make the necessary changes and I will then let you know when this has been done.' Mr Silver: ' Alright. Michael thank you.'" 33 Early in 2000 and before entering into the retirement variation deed, Mr Silver had a conversation with Mr Hutt at Dome's office in Sydney as follows: "Mr Hutt: 'Michael, Minter Ellison have prepared a variation deed and I understand from Minter Ellison that the variation will ensure that fees paid to Fair Choice as well as Goldspark plus your directors fees during the three year period prior to your retirement will be taken up in the calculation of your retirement benefit'. Mr Silver: 'Thanks Mike, that accords with my discussion with Charles.'" 34 On 13 March 2000 DRD made a takeover offer for Dome. In May 2000 DRD's takeover offer proceeded and DRD acquired approximately 97% of the shares in Dome. DRD subsequently exercised its statutory right to acquire compulsorily the outstanding shares in Dome and Dome is now a wholly owned subsidiary of DRD. 35 At about this time, Mr Hutt showed Mr Silver a calculation which he had prepared for Mr Mostert showing Mr Silver's retirement benefits as at 30 April 2000 as $450,855.00. 36 Before the board meeting mentioned below, Minter Ellison sent to Mr Hutt a draft deed titled "Retirement Variation Deed" in the form in which it was subsequently executed. 37 Mr Silver deposed that the entry into the retirement variation deed by Dome was considered at a board meeting held on 9 May 2000. That meeting was in fact held by conference telephone link between Mr Silver as chairman and Mr Hutt in Sydney, Mr Mostert and Mr Stratton in Johannesburg and Mr Barry Bolitho ("Mr Bolitho") in Perth. It was at that meeting that Mr Silver resigned as managing director, but continued as a non executive director of Dome. The minutes of that meeting, signed by Mr Silver as chairman, record the approval of Dome's entry into the retirement variation deed in Mr Silver's absence in the following terms: At this point, Mr Silver and Mr Hutt disclosed an interest in the matter about to be discussed and left the Board Room, leaving the conference telephone connected to DRD's Johannesburg office. "DIRECTORS RETIREMENT VARIATION DEEDS: After being advised by a telephone call on Mr Silver's mobile phone to return to the Board Room and the conference telephone call, Mr Silver and Mr Hutt were informed by Mr Mostert that the other directors had discussed the Retirement Variation Deeds and had RESOLVED to execute them. Mr Mostert said that he understood that the retirement benefits were only to be paid on the retirement of each director. Both Mr Silver and Mr Hutt agreed with this. Mr Mostert said that Mr Hutt would also be paid the amount in lieu of three months notice on his retirement." 38 Mr Silver also deposed that, upon Mr Silver rejoining the meeting after the board's discussion of the retirement variation deeds, Mr Mostert said words to the following effect: "The board has approved the entry into the retirement variation deeds." 39 It should be recorded at once that it was hotly contested whether a resolution approving the retirement variation deed was passed at that meeting and the decision of that issue was one of the most difficult in the course of resolving these proceedings. I shall return to it below. 40 An announcement to the Stock Exchange by Dome on 10 May 2000 included the following in relation to Mr Silver: "Mr Michael Silver has resigned as Managing Director, however Mr Silver will remain on the Board as a non-executive Director. It was Mr Silver who brought the Tolukuma Project to Dome in 1993, and he has been intimately involved with the development and operations of Tolukuma since that date, both as Principal Consultant and as a Director and since September of last year, Managing Director." 41 The retirement variation deed was executed on about 26 May 2000. It states that it was executed as a deed. It was executed on behalf of Dome by Mr Mostert as a director and by Mr Stratton as director/company secretary. It was executed on behalf of DRD by Mr Mostert as a director of DRD and also by M J Prinsloo ("Mr Prinsloo") as director/company secretary of DRD. Mr Silver did not instruct lawyers to act for him in relation to the retirement variation deed. At the time of his executing it Mr Silver's understanding of its effect was based upon his reading of it, the conversations he had had with Mr Mostert and Mr Hutt and the calculation made by Mr Hutt and referred to in his memorandum. 42 The retirement variation deed recited that DRD was the ultimate holding company of Dome and provided for the insertion in the retirement deed of new clauses 7 and 8 in the following form: " 7 Continuation as Non-Executive Director 7.1 In the event that the Director: (a) retires, resigns or is dismissed or removed as an Executive Director; and (b) is appointed at or about the time of such dismissal or removal, or continues, to hold the office of director of the Company; and (c) subsequently ceases to hold the office of director of the Company for any reason, the Company will immediately pay to Fairchoice Limited in respect of the Director ceasing to hold the office of Executive Director an amount equal to the amount which would have been payable under clause 3(a) of this Deed if the cessation had constituted retirement, removal or dismissal of the Director (on the day of ceasing to hold office as director) in circumstances described in clause 3(b) of this Deed. 7.2 Payment made in accordance with clause 7.1 will be in substitution for any other payment to which the Director might otherwise have been entitled under this Deed in respect of his ceasing to hold office as a director of the Company. 8 Guarantee 8.1 In consideration of the Director entering into this Deed at the request of DRD, DRD: (a) unconditionally and irrevocably guarantees to the Director on demand the due and punctual performance by the Company of all its obligations under this Deed; and (b) indemnifies the Director from and against any liabilities which may be incurred or sustained by the Director in connection with any default or delay by the Company in the due and punctual performance of any of its obligations under this Deed. …." It also provided for the replacement of all references in the retirement deed to Goldspark with references to Fair Choice. 43 Mr Silver deposed that it was in reliance upon his discussions with Mr Mostert and Mr Hutt, the calculation he was shown referred to in [35] above, and his understanding of the intent and effect of the retirement variation deed, that he remained as a director of Dome from May 2000 and rendered services to it until his resignation on 31 August 2000. Mr Silver said that, had he been of the view that the retirement variation deed did not secure a retirement payment as represented to him by Mr Mostert and Mr Hutt, he would have sought to put in place different arrangements with Dome. He believed that, because Dome then wished to secure his services, it would have been prepared to engage him to provide consulting services to it directly. He also believed that Dome would have been prepared to make the termination payment under the retirement variation deed payable to him and not to Fair Choice. Because of his belief as to the effect of the retirement variation deed, he deferred the opportunity to pursue other investment and consultancy opportunities and continued to devote his services to Dome. 44 Mr Silver has deposed that he believed that Mr Stratton and Mr Mostert had been properly authorised to execute the retirement variation deed on behalf of Dome and that Mr Mostert and Mr Prinsloo had been properly authorised to execute the retirement variation deed on behalf of DRD. He said that he had no reason to believe otherwise. He has also deposed that at no time did he believe or understand that the approval of Dome's shareholders was required before Dome could make a payment pursuant to the retirement variation deed. 45 During the period between 26 May 2000 and 31 August 2000 Mr Silver continued as a director of Dome. He deposed that he rendered services to Dome for its benefit during that time. 46 At the request of Mr Mostert in June 2000 he took a trip to South Africa to present a plan to DRD concerning the recapitalisation of Dome and to discuss other opportunities available in PNG. No consulting fee was charged in relation to that trip. 47 When providing services to Dome in Australia, Mr Silver usually worked from its Sydney office. On about 16 June 2000 Dome relocated its principal office from Sydney to South Perth. Mr Silver deposed that in August 2000 he considered it appropriate and timely for him to resign as a director of Dome in view of the relocation of the office to Western Australia and the fact that DRD had acquired 97% of the shares in Dome. On 25 August 2000 Mr Silver resigned as a director of Dome effective 31 August 2000. 48 In August 2000 Mr Silver began to correspond with the directors of DRD and Dome in relation to his termination payment. In this correspondence there was some contention as to the execution of the retirement variation deed by Dome, arising from an inability to locate a fully executed copy of that deed. On 10 October 2000 Mark Wellesley-Wood ("Mr Wellesley-Wood"), then chairman of DRD, stated the following in a facsimile to Mr Silver: "Despite the absence of a duly signed copy of your Retirement Variation Deed, I acknowledge that the Minute of the Dome Board Meeting of 9 May 2000 together with the affidavits signed by Directors present at the meeting, establishes an obligation for payment on behalf of Dome. Now that you have presented the facts, we would be prepared to make arrangements for payments over time as suggested in the penultimate paragraph of your letter." On 21 October 2000 Julian Tamby-Rajah, then a director and secretary of Dome, stated the following in a facsimile to Mr Silver: "As discussed I have reviewed your retirement deed and the consulting invoices to support your claim. Based on this I agree the amount (as indicated in your letter 22nd September 2000) is A$444,255. You have indicated in correspondence to Mark Wellesley-Wood that you would consider scheduling the payment of this amount. I would therefore like to suggest an initial payment of 20% and the balance over four months from that date. Please advise you [sic] acceptance of these terms." Subsequently, both Dome and DRD refused to make payment under the varied retirement deed or otherwise to pay the termination payment in respect of Mr Silver to Fair Choice. 49 The following clauses of Dome's Constitution ("the Constitution") are relevant to the arguments that have been put: "10.7 Remuneration. The Directors must be paid out of the funds of the Company, by way of remuneration for their services as Directors, a sum not exceeding such fixed sum per annum as may be determined by the Company in general meeting, to be divided among the Directors and [sic] in default of agreement then in equal shares. The remuneration of the Directors must not be increased except pursuant to a resolution passed at a general meeting of the Company where notice of the amount of the suggested increase and the maximum sum that may be paid has been given to Shareholders in the notice convening the meeting. No non-executive Director may be paid as part or whole of his remuneration a commission on or a percentage of profits or a commission or a percentage of operating revenue, and no executive Director may be paid as whole or part of his remuneration a commission on or percentage of operating revenue. The remuneration of a Director accrues from day to day. …… 11.1 Management of the Company. Subject to the Corporations Law and to any other provision of this Constitution, the business of the Company must be managed by the Directors, who may pay all expenses incurred in promoting and forming the Company, and may exercise all such powers of the Company as are not, by the Corporations Law or by this Constitution, required to be exercised by the Company in general meeting. …… 11.5 Retirement benefits for Directors. The Directors may at any time adopt any scheme or plan which they consider to be in the interests of the Company and which is designed to provide retiring or superannuation benefits for both present and future non-executive Directors, and they may from time to time vary any such scheme or plan. Any scheme or plan may be effected by agreements entered into by the Company with individual Directors, or by the establishment of a separate trust or fund, or in such other manner as the Directors consider proper. The Directors may attach such terms and conditions to any entitlement under any such scheme or plan as they think fit, including, without limitation, a minimum period of service by a Director before the accrual of any entitlement and the acceptance by the Directors of a prescribed retiring age. No such scheme or plan may operate to confer upon any Director or on any dependants of any Director any benefits not permitted by Section 237 of the Corporations Law. …… 14.1 Appointment. Subject to clause 14.4, the Directors may from time to time appoint one or more of their number to the office of managing director ( Managing Director ) of the Company or to any other office, except that of auditor, of employment under the Company, either for a fixed term or at will, but not for life and, subject to the terms of any agreement entered into in a particular case, may revoke any such appointment. A Director other than a Managing Director so appointed is referred to in this Constitution as an "Executive Director". The appointment of a Managing Director or Executive Director so appointed automatically terminates if he ceases for any reason to be a Director. 14.2 Remuneration. Subject to clause 10.7 and the terms of any agreement entered into in a particular case, a Managing Director receives such remuneration (whether by way of salary, commission or participation in profits, or partly in one way and partly in another) as the Directors may determine." Witness credit 50 The witness whose credit was principally under challenge was Mr Silver. He was extensively cross examined. He has been criticised by Mr T G R Parker, of Senior Counsel for the defendants, as a witness of poor credit, whose evidence should only be relied on when corroborated by reliable evidence. 51 I do not accept this view of Mr Silver's evidence. It is the case that his evidence was not wholly consistent or wholly satisfactory. The criticism of his evidence is recorded in detail in the defendants' written submissions and need not be repeated here. Two areas in which he was particularly criticised were his answers as to whether he regarded himself as an executive director or a non executive director of Dome at particular times. Another area was as to his understanding of the terms "consultant" and "executive" and whether work was done by him as a consultant or as an executive. It was submitted that the confusion in these answers should be taken as showing that he was concerned to give evidence which he believed best suited his case at any given time, rather than to give evidence that reflected his honest recollection of the relevant circumstances. 52 In my view, this submission does not allow for the considerable degree of semantic confusion relating to these two subject matters. For example, "executive director" is itself a term of indefinite connotation. Furthermore, it is used in two different ways in relevant documents, one being the relevant clauses of Dome's Constitution (see [49] above) and the other being the retirement deed, where it is the subject of a definition (see [22] above) not necessarily coextensive with the use of the term in the Constitution. These definitions could lead to different results. "Consultant" and "management" are likewise terms of wide, uncertain and probably overlapping connotation. In my view, it does not follow that some confusion in answers concerning these matters leads to a conclusion of dishonest intent, taking into account the uncertainty of the subject matter and all the surrounding circumstances, including the witness' demeanour. Contrary to the defendants' submission, neither does the witness' demeanour itself lead me to the conclusion that he was a dishonest witness. I should add that some of his answers as to his state of mind at the time in 1999 of the presentation to him of the retirement deed during his cross examination by video link from London are not at all satisfactory but neither does that fact lead me to the conclusion that he was a witness who was dishonest or trying to mislead the court. One must also bear in mind the length and intensity of his cross examination by Mr Parker. Equally, one must remember that the matters he was being cross examined about go back many years, in some instances as far back as 1994. 53 Overall I remained, at the end, of the view that he was a witness who was generally trying to give the Court an accurate account of events and states of mind as he recalled them. I relied, among other things, in forming this assessment on his demeanour generally, his answers in cross examination, and the inherent probability of much of what he said. I have the view that his version of all matters should be approached with some caution, but should be taken into account with the other available material as a possibly correct version of events and of his state of mind. I certainly do not come to the conclusion that he should be regarded as a witness whose word cannot be accepted unless corroborated by credible material. Acceptance of evidence he has given has played a large part in my acceptance of the material I have set out under the heading "The Facts", including my conclusion that he engaged in conversations that were in substance as set out above. I note that there was no evidence contradicting Mr Silver's version of the conversations and little cross examination concerning them. The cross examination as to the conversation in [33] was in my view to little effect. Insofar as it was suggested that this conversation was an invention because it appeared in a later affidavit, I do not accept that. 54 There was one answer in Mr Silver's cross examination by video link that, on one interpretation, could be taken as inconsistent with his earlier evidence. That was to the effect that he was not aware that the retirement variation deed had been the subject of a resolution by the directors of Dome in a directors' meeting at the time he came to sign the retirement variation deed. I should record that in my view this answer was aberrant, equivocal and unclear. I say that because of its context, its conflict with other evidence and the fact that that conflict was not put to him in cross examination to clarify the matter. Furthermore, counsel for the defendants expressly eschewed reliance on this answer as going to the witness' credit. The corporations legislation 55 As so often these days, companies litigation is bedevilled by the frequent changes to the relevant legislation. In general terms, the legislation that was current from 1 January 1991 until 15 July 2001 was, by virtue of s 7 of the Corporations (New South Wales) Act 1990, the Corporations Law set out in s 82 of the Corporations Act 1989 (Cth) as in force for the time being ("the CL"). As of 15 July 2001, the Corporations Act 2001 (Cth) ("the CA") commenced and replaced the CL. There are further complications arising from intermediate amendments, particularly to the provisions relating to termination payments to directors. These are discussed at [79] and [87] below. Contentions 56 The plaintiffs contended that they are entitled to judgment against both Dome and DRD in respect of the payment obligations or are entitled to relief under the provisions of the Trade Practices Act 1974 (Cth) ("the TPA"). 57 The contentions of the defendants that the plaintiffs are not entitled to relief fall under the following heads: 1 That the execution by Dome of the retirement deed and retirement variation deed was not authorised. 2 That payment cannot be made under the retirement deed or the retirement variation deed by reason of illegality. 3 That neither plaintiff is entitled to recover a judgment at law in respect of the payment obligations. 4 That the plaintiffs are not entitled to relief by way of specific performance because the payment obligations are not supported by consideration and are therefore not contractually binding. 5 That the defendants are estopped from denying the validity of the payment obligations. 6 That the plaintiffs are not entitled to succeed under the provisions of the TPA. 1 Authority of directors of Dome to enter into retirement deed and retirement variation deed 58 The particular questions that arose in this area are as follows: 1.1 Whether there was in fact a resolution of the directors of Dome authorising the execution of the retirement variation deed. 1.2 Whether the directors of Dome lacked authority to commit Dome to an agreement in terms of the retirement deed. 1.3 Whether the directors of Dome lacked authority to commit Dome to an agreement in terms of the retirement variation deed. 1.4 If there were such lack of authority, whether the plaintiffs are assisted by ss 124 or 125 of the CA. 1.5 If there were such lack of authority, whether Dome is prevented from relying on such lack of authority by ss 128 and 129 of the CA. 1.1 Resolution authorising execution of retirement variation deed. 59 The defendants did not contend that there was not a resolution of the directors of Dome authorising Dome to enter into the retirement deed. Nor did the defendants contend that the directors of DRD were not authorised to enter into the retirement variation deed. However, the defendants did contend that the retirement deed as executed did not correspond with the retirement deed as approved. They also contended that, in relation to the retirement variation deed, there was no resolution passed and that the directors of Dome did not in fact authorise the execution of the retirement variation deed. This was hotly contested, as has already been noted at [39] above. 60 The need to consider the argument arising from the alleged variation between the retirement deed as authorised and the retirement deed as executed is obviated by my conclusion at [71] below. The plaintiffs did not rely on any provision of the retirement deed as operative, but relied only on provisions inserted into the varied retirement deed by the retirement variation deed. The parties, by executing the retirement variation deed, confirmed in operation as part of the varied retirement deed the continuing portions of the retirement deed. 61 As to the retirement variation deed, there is an apparently regular minute of the directors' meeting of Dome of 9 May 2000 recording a resolution to the requisite effect: see [37] above. By s 251A(6) of the CA (which is identical to s 251A(6) of the CL) it is provided that a minute recorded and signed as provided for by that section is evidence of the resolution to which it relates unless the contrary is proved. In relation to this resolution, the defendants sought to prove the contrary by statements by Mr Bolitho, who attended that meeting by telephone link from Perth and was appointed a director at the meeting. Mr Bolitho was not called to give evidence. His statements were contained in a letter written by him to the Chairman of Dome on 22 December 2000. The statements in the letter were admitted into evidence on the basis that the letter was a business record of Dome. The body of the letter was as follows: "I have recently read a copy of the minutes that proport [sic] to record the Dome directors meeting held on May 9th 1999 [sic]. The minutes are incorrect in that the Retirement Variation Deed for Michael Silver was not discussed. Charles Mostert advised the meeting that a duly authorised Retirement Deed for Silver was legally binding and he recommended that the board acknowledge the deed. No deeds were tabled. I understand that a Dome board meeting is to be held in mid January, during which I propose to amend the draft minutes of the May 1999 meeting to properly reflect the matters discussed at the meeting." 62 It is to be noted that that letter acknowledges that there was at the meeting discussion of Mr Silver's retirement payment; that that letter was written more than six months after the meeting; and that, so far as the evidence goes, no correction was made to the May 2000 minutes at a meeting in January 2001 or at any other time. Against this, the minute is apparently regular and records not only the resolution but the fact that Mr Mostert informed Mr Silver of it on Mr Silver's return to the meeting. There is also Mr Silver's sworn evidence that he was informed by Mr Mostert that the resolution had been passed. It is to be noted that the deed was executed on behalf of DRD by directors, including Mr Mostert who was present at the Dome directors' meeting. The authorisation by DRD of the execution of the deed by those directors is not contested. It would be very curious if Mr Mostert executed on behalf of the guarantor company if the execution by Dome was not to his knowledge authorised, he being a director of both companies. 63 There is thus a clear and unaltered minute on the one hand. There is the execution by Mr Mostert of both documents. On the other hand, the pieces of evidence to the contrary are uncertain and unclear. On this material, I am not prepared to find that it is proved that the resolution was not passed as set out in the minute. Indeed, I find that it was passed. The execution of the retirement variation deed on behalf of Dome was therefore authorised by a resolution of the board. 64 It was also objected on behalf of the defendants that the retirement variation deed was not tabled at the meeting and that that either rendered invalid a resolution approving its execution or should lead the Court to conclude that the resolution was not passed as set out in the minute. Although documents to be approved for execution by a company are often tabled at the relevant directors' meeting, the tabling of a particular document is not a prerequisite to approval of its execution if the document is identified. Indeed, it is difficult to see how one "tables" a document at a directors' meeting spread over three sites in two continents. Evidence led by the defendants themselves established that the retirement variation deed was in existence in its final form at the time of the Dome directors' meeting and had been sent to at least one director. That this was the document referred to was attested by the reference in the recorded resolution to "Retirement Variation Deeds". This is not a standard or generic reference to documents, but was the title of the documents in relation to the relevant directors, including Mr Silver. The lack of a tabled document does not detract from my conclusion about the passing of the resolution. 65 I should add that the defendants' counsel also specifically eschewed reliance on the apparent admission referred to in [54] above concerning Mr Silver's state of mind when he executed the retirement variation deed on the question as to whether there was in fact a resolution of Dome authorising the execution of the retirement variation deed. 1.2 Authority of directors of Dome to commit Dome to an agreement in the terms of the retirement deed. 66 In view of my conclusion in [71] below, I do not propose to deal with this at great length. However, although I have had some doubts about this, I record my conclusion that the directors of Dome did have authority to enter into the retirement deed. The challenge to their authority is based in part on the dicta of Ormiston J in Sali v SPC Ltd (1991) 9 ACLC 1511 at 1521 – 1522: "Consequently, in a conventional kind of company, public or private, of which the defendant SPC is but an example, it is the members in general meeting who are responsible for the appointment of the ordinary directors of the company, and it is they who are, directly or indirectly, responsible for the terms upon which those directors act, including their rights to remuneration and any other payments in respect of their services. The company in general meeting either fixes the amount of remuneration pursuant to the articles or delegates, by and pursuant to the articles, the power to make specific payments. So in the usual case (and excepting executive directors) the essential terms upon which the directors serve are set out exclusively in the articles of association, even if details may be delegated to the board. It is for the company in general meeting to determine whether those terms are to be added to or varied, such determination being given effect to by amendment of the articles of association. These conclusions follow as a matter of analysis from general principle and from the nature and corporate structure of the ordinary limited liability company, and they are implicit from the reasoning of House of Lords in [ Guinness Plc v Saunders [1990] 2 AC 663] which places heavy emphasis on the fiduciary obligations of the members of the board of directors: see esp per Lord Templeman at pp 689 - 696. It would follow that it is not usually within the power of the board of directors to enter into any agreement for the provision of retirement allowances or indeed for any financial emoluments to any ordinary members of that board. In truth, however, the plaintiff would have to go further than establishing a contract to that effect, for what in substance is being alleged is that the existing terms of service upon which the plaintiff acted were varied, not by the organ of the company which appointed him and laid down those terms, but by a different organ, namely the board of directors, which played no part and could in the ordinary course of events play no further part in his continued appointment or re-appointment as a director. It should be added that this conclusion is not dependent upon an analysis of the powers of a company, nor upon any revival sub silentio of the doctrine of ultra vires, abolished by s 66A to s 68 of the Code: see now s 159 - s 162 of the Corporations Law. There is no doubt that a company has power by appropriate means to include as a term of the appointment of the directors, or so to vary the existing terms, that they be entitled to payment of a retirement allowance. The only question here is whether the company did so in the manner alleged by the plaintiff." 67 Those statements are in fact obiter dicta, as Mr Parker has pointed out, because his Honour decided the case on the basis that contractual relations between the retired director and the company were not established. However, his Honour explicitly expressed the view that a general management article in much the same terms as cl 10.7 of Dome's Constitution did not, in the face of the principles that his Honour stated, authorise directors to grant retirement benefits to non executive directors. 68 However, that is not the end of the matter. The plaintiffs alternatively submitted that, at least in the case of the subject Constitution, cl 10.7 did not apply to the remuneration of executive directors in respect of their executive duties, but only to the remuneration of directors as non executive directors. 69 I find the relevant provisions of the Constitution convoluted and very hard to construe sensibly together. It is true that executive directors are mentioned in cl 10.7 and that cl 10.7 is mentioned in cl 14.2. Nevertheless, as best as I can construe the provisions, I am of the view that all that is committed to the decision of the general meeting is the total sum payable to directors as remuneration for their non executive duties as directors. The appointment of both managing directors and executive directors is committed by cl 14.1 to the board, which it is contemplated will enter into agreements with them. Clause 14.2 commits the remuneration of managing directors, though not in terms executive directors, to the board. However, it is the board that appoints and enters into agreements with executive directors as well as managing directors. It would seem strange, if not unworkable, that a general meeting, as well as the board, had to approve every adjustment to executive directors' remuneration, rather than simply fixing annually the global sum to be paid to directors for their non executive duties. It is therefore my view that it was within the purview of the directors, at the time of the execution of the retirement deed, to fix the remuneration for executive duties of an executive director, or a director performing executive duties, as Mr Silver then was, including the provision, if thought fit, of retirement benefits. 70 The defendants also submitted that the remuneration was not of Mr Silver, but of Goldspark or Fair Choice. As to this argument, see [101] below. 1.3 Authority of directors of Dome to commit Dome to an agreement in the terms of the retirement variation deed. 71 Although I have deemed it appropriate to express the view set out in [66] above, it is not in my view operative in the determination of this case. That is because the payment obligations that are now called upon do not emanate from the retirement deed, but solely from provisions inserted by the retirement variation deed into the varied retirement deed. That means that the now operative obligations are imposed upon both Dome and DRD by their execution of the retirement variation deed. Their validity, in my view, depends upon the validity of that deed rather than the validity of the original retirement deed. At the time of the approval of the execution of the retirement variation deed, Mr Silver was about to revert to the role of non executive director of Dome and it was in this capacity that cl 7 of the varied retirement deed was to apply to him. Whatever is unclear about the provisions of the Constitution, cl 11.5 reasonably clearly confers power on the directors to make provision for retirement benefits for non executive directors. (The absence of a similar provision in respect of executive directors may well reflect the view of the draftsman that this subject matter was already committed to the board by the Constitution, along with executive directors' remuneration generally.) In the case of non executive directors, the constitutional power is expressly and, in my view, validly conferred on the board. The dicta in Sali's case are not to the contrary, since the articles in Sali did not contain a provision corresponding to cl 11.5. 72 In my view, therefore, the directors of Dome had power under the Constitution to make provision for termination benefits for Mr Silver at the time they did by authorising the execution of the retirement variation deed inserting the relevant provisions into the varied retirement deed. 73 The plaintiffs put other bases on which the same conclusion may be reached, but it is unnecessary to deal with them here. 1.4 Operation of ss 124 and 125 of corporations legislation 74 These provisions are substantially identical in the CL and the CA. Question 1.4 needs to be answered only if there were a relevant lack of authority. As I have found, there is no such lack of authority, particularly in view of my conclusion in relation to question 1.3 stated at [72] above. In those circumstances this question does not arise for decision. 75 In any event, these sections could not be relevant. They are the sections in the modern legislation disposing of the doctrine that a company could not engage in actions outside its defined powers (ultra vires). There is no question here that the provision of retirement benefits is beyond the powers of the company. The sole question is, by which organ of the company (general meeting or board of directors) they may be provided in particular circumstances. 1.5 Operation of ss 128 and 129 of corporations legislation 76 Likewise, in light of my finding that the directors of Dome had authority to enter into the operative instrument, this question does not arise for decision. 77 If they did not have authority, I should find that Mr Silver was entitled to make the assumptions in s 129 and particularly the assumption in s 129(3)(b). I should find on the evidence that Mr Silver did not know or suspect that the assumption was incorrect within the meaning of s 128(4), bearing in mind the classic definition of suspicion enunciated by Kitto J in Queensland Bacon Pty Ltd v Rees (1966) 115 CLR 266 at 303. 2 Interpretation of restrictions on retirement benefits: what is prohibited and when 78 The particular questions that arise under this head are as follows: 2.1 What are the relevant provisions of the corporations legislation? 2.2 When does Part 2D.2 Division 2 operate? 2.3 Are the payment obligations prohibited by s 200B(1)? 2.4 Does the exception to the prohibition in s 200G(1)(b) apply? 2.4.1 Is the promised payment for past services that Mr Silver rendered to Dome? 2.4.2 Would the retirement payment under the varied retirement deed exceed the payment limit set by s 200G(2)(b)? 2.5 If the payment would exceed the payment limit, then may the varied retirement deed be read down or severed so as to oblige Dome to pay an amount equal to the payment limit? 2.1 The relevant legislative provisions 79 The relevant sections as set out below are taken from the CA. In fact, the CL originally contained not dissimilar provisions in s 237 (as to which see further below), but that section was in March 2000 repealed and replaced in the CL by a Part 2D.2 Division 2, which was in terms substantially identical for the purposes of this matter with Part 2D.2 Division 2 of the CA. It was s 237 that was in force at the time the retirement deed was entered into, but the new Part 2D.2 Division 2 of the CL that was in force when the retirement variation deed was entered into in May 2000. It is Part 2D.2 Division 2 of the CA that is in force at the present time, as to the relevance of which see [87] below. 80 The provisions of Part 2D.2 Division 2 of the CA are, so far as relevant, as follows: " Division 2—Termination payments 200A When benefit given in connection with retirement from office (1) For the purposes of this Division: (a) a benefit is given in connection with a person's retirement from an office if the benefit is given: (i) by way of compensation for, or otherwise in connection with, the loss by the person of the office; or (ii) in connection with the person's retirement from the office; and (b) giving a benefit includes: (i) if the benefit is a payment—making the payment; and (ii) if the benefit is an interest in property—transferring the interest; and (c) a person gives a benefit even if the person is obliged to give the benefit under a contract; and (d) a pension or lump sum is paid or payable in connection with the person's retirement from an office if the pension or lump sum is paid or payable: (i) by way of compensation for, or otherwise in connection with, the loss by the person of the office; or (ii) in connection with the person's retirement from the office; and (e) retirement from an office includes: (i) loss of the office; and (ii) resignation from the office; and (iii) death of a person at a time when they hold the office. (2) For the purposes of this Division, if: (a) a person ( person A ) gives another person a benefit ( benefit A ); and (b) person A gives benefit A for the purpose, or for purposes including the purpose, of enabling or assisting someone to give a person a benefit in connection with the retirement of a person ( person B ) from an office; person A is taken to give benefit A in connection with the person B's retirement from that office. 200B Retirement benefits generally need membership approval Benefits in connection with retirement from board or managerial office (1) The following must not give a person a benefit in connection with that person's, or someone else's, retirement from a board or managerial office in a company, or a related body corporate, without member approval under section 200E: (a) the company; (b) an associate of the company (other than a body corporate that is related to the company and is itself a company); (c) a prescribed superannuation fund in relation to the company. Note 1: Sections 200F, 200G and 200H provide for exceptions to this rule. Note 2: Section 9 defines board or managerial office . (1A) For an offence based on subsection (1), strict liability applies to the circumstance, that the benefit is in connection with the person's, or someone else's, retirement. Note: For strict liability , see section 6.1 of the Criminal Code . …… 200D Contravention to receive benefit without member approval (1) A person who: (a) holds, or has at any previous time held, a board or managerial office in a company or related body corporate; or (b) is the spouse of a person referred to in paragraph (a); or (c) is a relative of a person referred to in paragraph (a) or of the spouse of such a person; or (d) is an associate of a person referred to in paragraph (a) or the spouse of an associate of such a person; must not receive a benefit if the giving of the benefit contravenes section 200B or 200C. Note: Section 9 defines board or managerial office . (2) An offence based on subsection (1) is an offence of strict liability. Note: For strict liability , see section 6.1 of the Criminal Code . 200E Approval by members (1) If section 200B or 200C requires member approval for giving a person a benefit, it must be approved by a resolution passed at a general meeting of: (a) the company; and (b) if the company is a subsidiary of a listed domestic corporation—the listed corporation; and (c) if the company has a holding company that: (i) is a domestic corporation that is not listed; and (ii) is not itself a subsidiary of a domestic corporation—the holding company. …… 200G Genuine payments of pension and lump sum (1) Subsection 200B(1) does not apply to a benefit if: (a) the benefit is a payment in connection with a person's retirement from a board or managerial office (the relevant office ) in a company or a related body corporate; and (b) the payment is for past services the person rendered to: (i) the company; or (ii) a related body corporate; or (iii) a body that was a related body corporate of the company when the past services were rendered; and (c) the value of the benefit, when added to the value of all other payments (if any) already made or payable in connection with the person's retirement from board or managerial offices in the company and related bodies corporate does not exceed the payment limit set by subsection (2). In applying paragraph (c), disregard any pensions or lump sums that section 200F applies to. (2) The payment limit is: (a) the amount worked out under subsection (3) if the person: (i) was an eligible employee in relation to the company at the time when the person retired from the relevant office; and (ii) has been an eligible employee in relation to the company throughout a period (the relevant period ), or throughout periods totalling a period (also the relevant period ), of more than 3 years; or (b) otherwise—the total remuneration of the person from the company and related bodies corporate during the period of 3 years ending when the person retired from the relevant office. Note: Section 9 defines remuneration . ……" 81 It flows from my conclusions in [79] above that, in my view, s 237 of the CL does not have any direct relevant application in the circumstances of this case. However, it has an indirect relevance in that its terms are referred to in the retirement deed in a fashion which continues to be relevant in the retirement variation deed, because, as appears above, the amount to be paid is be the total emoluments over three years "calculated in accordance with the formula in s 237(6)(b)(ii)" of the CL. It is to be noted that this formula proceeds by reference to "emoluments" and not "remuneration". Furthermore, whereas Part 2D.2 Division 2 of both the CL and the CA does not contain a special definition of remuneration, but relies on the general definition of remuneration in s 9, s 237 contained a definition of "emoluments" for the purposes of the section in the following form: " emoluments , in relation to a person who is a director or other officer of a body corporate, means the amount or value of any money, consideration or benefit given, directly or indirectly, to that person in connection with the management of affairs of the body corporate or of any holding company or subsidiary of the body corporate, whether as a director or officer or otherwise, but does not include amounts in payment or reimbursement of out-of-pocket expenses incurred for the benefit of the body corporate." In my view, however, the requirements of the two provisions are substantially the same: see [108] below. 2.2 Time of operation of Part 2D.2 Division 2 82 The interpretation of these provisions is of considerable importance in this case. The defendants contended that, upon the proper construction of s 200B in the context of the other provisions, not only is the payment of the agreed benefit forbidden but the agreement to make the payment was itself forbidden, so that the agreement is illegal. Alternatively, the defendants submitted that, even if the agreement was not forbidden, the prohibition applied as soon as the obligation to pay crystallised, most likely on Mr Silver's resignation as a director of Dome as at 31 August 2000. 83 On the basis of my view that no obligations under the retirement deed are still current and that the relevant obligations are those inserted in the varied retirement deed by the retirement variation deed, the relevant agreement in this context is the retirement variation deed brought into force in May 2000. The only provisions that need to be considered are the provisions of Part 2D.2 Division 2, whether contained in the CL or the CA. 84 I am of the view that what is forbidden where the benefit is in the form of a payment is the making of the payment. The agreement to make the payment is not forbidden, nor does the prohibition arise at any time before the payment actually comes to be made. This flows in my view from the fact that s 200B(1) in terms operates by reference to the giving of a benefit without member approval. It is reinforced by the matter as to interpretation contained in s 200A(1)(b), which emphasises that the occurrence of the giving of the benefit is at the time of the making of a payment or the transferring of an interest in property, if the benefit is an interest in property. Equally, the offence created in relation to a person entitled to a prohibited benefit is committed upon receipt of the benefit and not earlier: s 200D(1). 85 These matters were dealt with by Walton J in the Industrial Commission of NSW in Fox v GIO Australia Ltd (2002) 56 NSWLR 512. I follow his Honour's decision not only out of respect for the decision of a Judge of equivalent status to a Judge of this Court, but because I am convinced that the conclusion and His Honour's reasoning are correct. I agree with Walton J's conclusion that "it is not until a company actually makes a payment (or otherwise gives a benefit) that any transgression occurs": see Fox at [76] - [78]. That approach appears to have been recently approved in the Supreme Court of Victoria in Orrong Strategies Pty Ltd v Village Roadshow Limited [2007] VSC 1 by Habersberger J at [660], [661]. Habersberger J also found support for the approach in the judgments of Ormiston J in Sali at 1524 and of Einstein J in Whitlam v Insurance Australia Group Limited (2005) 52 ACSR 470 at [239]. 86 In my view, the prohibition is ambulatory and operates only to prohibit payment without members' approval at any time at which such a payment actually comes to be made. There is no express prohibition of the contract being entered into, nor is any such prohibition to be implied or inferred. 87 The result of this is, in my view, that the obligation having been entered into and no payment having actually been made, the legislative provision which prohibits payment at the present time (if payment be prohibited) is the provision of the law at present applicable, ie, s 200B(1) of the CA. The provisions of s 200B(1) when inserted into the CL were the same. It also follows that, if it were necessary, in my view a members' meeting or members' meetings could still now be called to give members' approval to the payment. 2.3 Are the payment obligations prohibited by s 200B(1)? 88 It is reasonably clear that the payment obligations are prohibited by s 200B(1), unless the requirements of that section for the holding of a general meeting or general meetings are met or the payment obligations pass through the gateway provided by s 200G(1). 2.4 Does the exception to the prohibition in s 200G(1)(b) apply? 2.4.1 Is the promised payment for past services that Mr Silver rendered to Dome? 89 Although the agreements relating to the provision of Mr Silver's services were made with Goldspark and then Fair Choice, it was plain at all times that it was Mr Silver personally who was to render the services and Mr Silver who did so. I do not accept that s200G(1)(b) should be interpreted as limited to past services rendered under a contract with the person – to do so would be to put a gloss upon the statute. Furthermore, as will be seen in [101] below, it is my view that the payments that were made, although made to those companies, were benefits to Mr Silver in connection with those services. In those circumstances, it is my conclusion that the promised payments were for past services that Mr Silver rendered to Dome. 2.4.2 Would the retirement payment under the varied retirement deed exceed the payment limit set by s 200G(2)(b)? 90 This depends on whether the consultancy fees paid to Goldspark and Fair Choice can be characterised as remuneration of Mr Silver by the company within the meaning of s 200G(2)(b). This includes the questions of whether the consultancy fees were remuneration of Mr Silver (as opposed to remuneration of Goldspark and Fair Choice) and whether the consultancy fees were paid in connection with the management of the affairs of Dome or any of its subsidiaries. 91 The defendants contended that the payment sought by the plaintiffs is above the payment limit in s 200G(2)(b). The limit is Mr Silver's total remuneration during the three years ending at retirement. The defendants said that this limit is exceeded because the amount claimed is calculated by reference both to the director's fees that were paid to Mr Silver (which they conceded should be taken into account when calculating the payment limit) and the consulting fees that were paid for his services (which they contended were not part of his remuneration within the meaning of s 200G(2)(b) and cannot be included in that calculation). If the consulting fees cannot be included in the calculation of the payment limit in s 200G(2)(b), then the amount claimed is beyond the payment limit. 92 Both sides agreed that remuneration within s 200G(2)(b) must be construed by reference to the definition of remuneration contained in CA s 9. That definition provides that a benefit given to an officer is remuneration if the benefit, were it received by a director of the corporation, would be remuneration of the director for the purposes of an accounting standard that deals with disclosure in companies' financial reports of information about directors' remuneration. 93 The parties put their original submissions to the Court on the basis that the relevant Accounting Standard was Accounting Standard AASB 1017 of February 1997. However, that Standard has been superseded by Accounting Standard AASB 1046 of January 2004. If the prohibition of payment operates at the present time (as I have in fact found), the plaintiffs submitted that it is AASB 1046 that is relevant to the meaning of remuneration and the calculation of the payment limit in s 200G(2)(b) in the present case. However, the reference in s 200G(2)(b) is to the remuneration of the person during the period of three years ending when the person retired from the relevant office. It was AASB 1017 that was in effect and relevant to the determination of remuneration during those three years. AASB 1046 specifically by cl 2.1 provides that it applies to annual reporting periods ending on or after 30 June 2004. In these circumstances, I am of the view that it is AASB 1017 which continues relevant to the determination of the amount of the remuneration in earlier years, even when that calculation comes to be made at the present time. 94 AASB 1017 relevantly provides as follows: " Remuneration of Directors 4.2 Subject to paragraph 4.4, the accounts must disclose: (a) the aggregate of the income paid or payable, or otherwise made available, in respect of the financial year, to all directors of the entity, directly or indirectly, by the entity or by any related party …… 4.5 In paragraphs 4.2 and 4.3, 'income', in relation to a director of an entity, means all their remuneration: (a) in connection with the management of the affairs of the entity, or any of its subsidiaries, whether as a director or otherwise ……" 95 AASB 1017 by paragraph 4.17 requires in addition the disclosure of transactions ("excluding transactions subject to" paragraph 4.2) with the directors "or their director-related entities". It is these provisions that make plain that remuneration includes income paid or otherwise made available to a director by the entity directly or indirectly and that the payment must be "in connection with the management of the affairs of the entity, or any of its subsidiaries, whether as a director or otherwise". 96 As I have already indicated, the plaintiffs contended both that the consultancy fees paid to Goldspark and Fair Choice are to be characterised as paid indirectly to Mr Silver and that they were paid in connection with the management of the affairs of Dome or its subsidiaries. As to the first contention, the defendants' answer was that each payment was "received on the company's own account" and was "not in the ordinary use of language even an indirect payment to the director". As to the second contention, the defendants' answer was that the fees were paid under the "consultancy agreements" as fees for consultancy services; that even if Mr Silver also involved himself in management, this "does not affect the nature of the consultancy fees"; and that they cannot be characterised as paid in connection with management. 97 There are two things that should be done before I turn to the two individual arguments. 98 The first is to say that, importantly, in my view, the policy of the Accounting Standard, and therefore the policy of the definition of remuneration in s 9, is to amplify rather than restrict the meaning of remuneration, so as to ensure that full disclosure is made of anything that may be a benefit given to directors. The definition of remuneration in s 9, by reference to which s 200G(2) proceeds, is a general definition for the purposes of the whole Act, rather than a special definition like the definition of emoluments in the former s 237. Therefore, it cannot be given a restrictive meaning in s 200G(2)(b), without that restrictive definition also applying to the concept of remuneration in other provisions of the CA. The definition of "remuneration" in s 9 must, therefore, in my view, be given an ample definition along the lines set forth in the exposition of what remuneration is in the relevant portion of AASB 1017. The policy is to catch anything that is, in reality, a reward to a director. 99 The second is to refer back to some relevant factual material. Although often referred to as consultancy services, Mr Silver's services were not always characterised between the parties as consultancy services. There are only two relevant contractual documents in evidence. The first, Goldspark's letter of 6 April 1993 set out in [7] above, states that "the services of Mr Michael Silver will be retained in the development of the Tolukuma project … as part of the Supervisory and Management Team … at a figure of $6,000 per calendar month." The letter does not mention consultancy services or consultancy fees. That letter was the contractual document in force till 3 May 1999, the date of the second contractual document, Dome's letter to Goldspark set out in [17] above. It is true that after April 1993 fees were often charged as "consultancy fees" or by reference to "consulting services", but there is an air that this was a convenient shorthand or abbreviation by which to refer to the services. After some years of usage between the parties, the terms "consultant" and "consultancy" are embedded in the 1999 contract, which is for "the personal services of Mr Michael Silver as a consultant to Dome for a minimum of half of the usual business days of each month … on all and any matters as required by Dome's Executive Chairman … [at] a fee of $10,000 to Goldspark for each month's consultancy". This terminology had not only become conventional between the parties, but was used in the light of the many and varied duties which Mr Silver had performed for Dome by that time. The monthly fee was increased to $20,000 in May 1999. It is also noteworthy that, when Mr Silver was appointed managing director of Dome on 27 September 1999, there was, on the evidence, no further agreement for his remuneration in that office; he continued to be paid the monthly fee until he left that office in May 2000. 100 I turn back to the first contention, as to whether the payments were remuneration of Mr Silver rather than of the companies. In my view, the payments to Goldspark and Fair Choice were benefits indirectly given to Mr Silver. It must always be borne in mind that, although payment was to be made to Goldspark, then Fair Choice, the services to be provided for which payment was to be made were the personal services of Mr Silver and no other services. That payments to those entities represented benefits to Mr Silver is made clear by the evidence, which I accept, of his beneficial interest in shares of those companies and his agreements with Mr Yu that Mr Silver should be able to access, if desired, payments made to those companies in respect of his services rendered to Dome, and that he in fact did so. 101 I conclude that those payments were received by Mr Silver within the meaning of the definition of remuneration; were remuneration of Mr Silver within the meaning of paragraph 4.5; were part of his income within the meaning of paragraph 4.2 of AASB 1017; and were therefore remuneration for the purposes of s 9 of the CA. 102 If I am wrong that the applicable Standard is AASB 1017 and it is AASB 1046 that should be taken into account, the provisions of that Accounting Standard are not greatly different, although remuneration and what are in that Standard called "personally-related entities" are dealt with in the same provision: paragraph 5.1. Under the provisions of AASB 1046 also, the correct conclusion would be that the consultancy fees were remuneration of Mr Silver. 103 The second contention, on the defendants' version, was that the consultancy fees could not be taken into account in the calculation, because in whole, or at least in part, they were not paid in connection with the management of the affairs of Dome or any of its subsidiaries, but instead as consultancy fees. The categories were said to be mutually exclusive. As the parties had chosen to place the payments in the category of consultancy fees, they could not now be characterised as paid in connection with the management of the affairs of Dome. It was also said that most of the matters undertaken by Mr Silver "were the sort of tasks which one might expect to have been undertaken by a mining consultant". 104 I found the whole debate as to the matters set out in [103] above rather arid. It proceeded on the basis that consultancy fees and fees in connection with management were somehow or other mutually exclusive categories. The words "consultant" and "consultancy" are words that are somewhat abused in modern usage. The dictionary definition (Macquarie Dictionary (4th ed, 2005)) of "consultant" remains "someone who consults" or "someone who gives professional or expert advice" and the definition of "consult" is "to seek counsel from; ask advice of". Despite this, the word "consultant" is used in wider senses. In the legal profession, for instance, a "consultant" in a solicitors' firm is frequently a retired member who continues to do some work with clients instead of, or as well as, being available to give advice to others in the firm. But, whether or not the payments are described as consultancy fees, it should be borne in mind that the criterion in paragraph 4.5(a) of AASB 1017 is that the money should have been paid "in connection with the management of the affairs of the entity". 105 "Management" is a word of wide meaning. It is defined in the Macquarie Dictionary as: "The action of managing; the manner of managing; the application of skill or care in the manipulation, use, treatment, or control of things or persons, or in the conduct of an enterprise, operation, etc. ….." The definition in the Shorter Oxford English Dictionary (5th ed, 2002) is virtually identical. This definition is wide in ambit. But the words "in connection with" give the phrase an even wider denotation than if the expression had been that the payment was "for" the management of the company. In Re Heaney; Ex parte Flint v Nexus Minerals NL WASC Full Court 26 February 1997 unreported Kennedy J, with whom Malcolm CJ and Pidgeon J agreed, said: "It is important for the present purposes to note that the expenditure does not have to be on mining, as such, to satisfy the terms of reg 21. It may be 'in connection with' mining. The words 'in connection with' are words of wide import and, as with the words 'connected with', and, [sic] subject to the context in which the words are used, are capable of describing a spectrum of relationships ranging from the direct and immediate to the tenuous and remote…" See also Berry v Federal Commissioner of Taxation (1953) 89 CLR 653 per Kitto J at 658 - 659; Claremont Petroleum NL v Cummings (1992) 110 ALR 239 per Wilcox J at 280; Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 per Neaves, French and Cooper JJ at 288 - 289. 106 Concerning these arguments two things ought be said. First, the construction of remuneration ought proceed by reference to matters of substance, not matters of form. To concede supremacy to the latter would permit parties, by placing a convenient label on payments, to exclude them from the ambit of "remuneration", contrary to the policy of the definition and the statute. Secondly, without going into the detail of the various activities carried out by Mr Silver, many of them involved him directly in management of the affairs of the company. Additionally, it is to be borne in mind that this is the payment regime that prevailed while he was actually managing director of Dome. But to the extent that what he did was to consult or give advice, rather than actually engaging directly in management, the advice was advice concerning matters that were involved in the management of the company and was therefore advice in connection with that management. In some cases, this may mean that the services were both consultancy services and services in connection with the management of the company. It is in my view a fallacy that those categories are mutually exclusive. My conclusion is that the consultancy fees were paid in connection with the management of Dome or its subsidiaries. 107 There were tendered in evidence Urgent Issues Group Abstract 14 Directors' Remuneration issued on behalf of the Australian Society of Certified Practising Accountants and The Institute of Chartered Accountants in Australia and two reports of Mr Potter, a chartered accountant, which purported to provide expert evidence about the view that would be taken by accountants of the meaning of remuneration in the context of the AASB 1017 and the Urgent Issues Group Abstract. Mr Potter, over objection, gave oral evidence. All this evidence was the subject of great controversy. I reserved to final submissions submissions on the admissibility of all this evidence. I rule the Urgent Issues Group Abstract admissible as a document issued by the professional accounting bodies relating to the interpretation of the Accounting Standard, but I did not find it of assistance in coming to the conclusion I have expressed. With considerable doubt, I think the better course is also to rule Mr Potter's reports and oral evidence admissible. But, again, I have not taken them into account at all in coming to my conclusion. To regularise the record, the Urgent Issues Group Abstract 14 Directors' Remuneration has been marked Exhibit L. Mr Potter's report of 5 April 2002, which is contained in Volume 2 of Exhibit A, and his oral evidence are confirmed as being in evidence on the trial. Mr Potter's supplementary report of 5 April 2005, which was marked as Exhibit A15 on the application for its receipt, has now been formally received and marked Exhibit M. 108 The formulation of the benefits to be given in the varied retirement deed still incorporates by reference the now superseded provisions of s 237 of the CL. However, I do not think that the substance of the provisions of s 237 differs in a relevant way from the provisions of s 200G of the CA. In my view, the payment due under the varied retirement deed calculated by s 237 criteria will not be greater than the payment limit as of today calculated under the provisions of s 200G(2). The result is that the payment due under the retirement deed does not exceed the payment limit imposed by s 200G(2). There is therefore no statutory prohibition on the making of the payment provided for by the varied retirement deed. 2.5 Whether, if the payment limit is exceeded, the varied retirement deed may be read down so as to oblige payment of an amount equal to the payment limit 109 In view of the conclusion in [108] above, it is not necessary to decide this question. 3 Is either plaintiff entitled to recover a judgment at law in respect of the payment obligations? 110 If the payment obligations are enforceable, the promise of payment in the varied retirement deed is made to Mr Silver, but the payment is to be made to Fair Choice. For that reason, there cannot be judgment for the promised amount in favour of Mr Silver, as he is not the person entitled to payment. Can there be judgment for the relevant monetary sum in favour of Fair Choice? Under the doctrine of privity of contract, there could not be such a judgment, because Fair Choice is not a party to the contract sued upon. There has been some relaxation of the doctrine of privity by the High Court to permit actions to be brought by persons benefited by a contract but not party to it. However, to date, that relaxation in the doctrine has been limited to beneficiaries under policies of insurance who are not parties to those policies: Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107. 111 In fact, the Trident case specifically involved a policy of liability insurance. There are dicta of Brownie J in this Court in Barroora Pty Ltd v Provincial Insurance Ltd (1992) 26 NSWLR 170 at 176 - 179 that the exception to the rule in Trident was not limited to contracts of liability insurance, but applied equally to contracts of property insurance. In the Full Court of Western Australia Franklyn J expressed a view in Co-operative Bulk Handling Ltd v Jennings Industries Ltd (1996) 17 WAR 257 at 265 – 266 generally supporting Brownie J's view. These views were approved by Anderson J in Woodside Petroleum Development Pty Ltd v H&R-E&W Ltd (1997) 18 WAR 539 at 562. 112 In logic, it can be argued that the principle should extend to parties benefited under other classes of contract. However, despite the passage of nearly 20 years since the decision in Trident, I am not aware of any decision, particularly of an appellate court, the ratio decidendi of which would justify the widening of the exception (except in the very limited way mentioned in [111] above). 113 The contrary view was recently expressed in this Division by Brereton J in Mizzi v Reliance Financial Services Pty Ltd [2007] NSWSC 37, where his Honour said at [71]: "… generally, only parties to a contract can enforce it [ Dunlop Pneumatic Tyre Co Limited v Selfridge & Co Limited [1915] AC 847, 853 (Viscount Haldane LC); Coulls v Bagots Executor and Trustee Co Limited (1966) 119 CLR 460, 478 (Barwick CJ)]. The application of the doctrine of privity in its full extent has been questioned, and in Trident General Insurance Co Limited v McNiece Bros Pty Ltd (1988) 165 CLR 107, five of seven members of the High Court allowed a stranger to sue on an insurance contract. However, only three did so on the footing that the rules as to privity should be relaxed, at least in the context of an insurance contract. The prevailing view is that the rules as to privity remain the law [ Winterton Constructions Pty Ltd v Hambros Australia Limited (1991) 101 ALR 363 (Gummow J)]." 114 His Honour went on in [72] to refer to cases in which it was held that a party to a contract was the trustee for a third party of the benefit of a contractual promise to confer a benefit on the third party. However, a submission was not made to that effect in the present case. In any event, I do not see a basis on the evidence in this case for finding that Mr Silver held the benefit of the contractual promises on trust for Fair Choice. In the absence of authority of the High Court or other convincing authority that the Trident doctrine should be taken to be extended beyond contracts of insurance, I concur in and adopt the view expressed by Brereton J in Mizzi at [71]. 115 In those circumstances, I am of the view that, as the law stands, Fair Choice is not entitled, even if it were otherwise appropriate, to recover judgment at law for the amount promised under the varied retirement deed to be paid to it. 116 The plaintiff did also argue that the varied retirement deed was enforceable by Fair Choice as a deed poll against Dome although not against DRD. However, in view of my conclusion recorded below at [138] concerning specific performance, there is no need to determine that contention. 4 Whether the plaintiffs are entitled to relief by way of specific performance 117 Under this head three questions arise: 4.1 May an obligation to pay money be enforced by specific performance? 4.2 Are the plaintiffs disentitled to specific performance against Dome because of lack of consideration for the payment obligations? 4.2.1 Is consideration necessary? 4.2.2 Is there sufficient consideration? 4.3 Are the plaintiffs disentitled to specific performance against DRD because of lack of consideration for the payment obligations? 4.3.1 Is consideration necessary? 4.3.2 Is there sufficient consideration? 4.1 May an obligation to pay money be enforced by specific performance? 118 The fact that neither plaintiff is entitled to a judgment at law does not mean that there is no remedy available to enforce payment to Fair Choice. Mr Silver, as a party to the contract, may seek to have it specifically performed by the payment by Dome and by DRD of the relevant sum to Fair Choice, which is not a party to the contract. 119 Specific performance will be granted in lieu of damages "only when it can by that means do more perfect and complete justice": Wilson v Northampton and Banbury Junction Railway Co (1874) LR 9 Ch App 279 at 284 per Lord Selborne; and see Meagher, Gummow and Lehane, Equity: Doctrines and Remedies (4th ed, 2002) at [20-030]. It is clear that there are circumstances where damages may be an inadequate remedy for a breach of a contract to pay or lend money. 120 In particular, it is established that a contract promising to pay money to a third party "will not generally be a contract for the breach of which damages will be an adequate remedy" (Meagher, Gummow and Lehane at [20-050]) and therefore such a contract will be specifically enforceable by the parties to it: Beswick v Beswick [1968] AC 58; Woodar Investment Development Ltd v Wimpey Construction UK Ltd [1980] 1 WLR 277 at 293. In Coulls v Bagot's Executor & Trustee Co Ltd (1967) 119 CLR 460, Barwick CJ said at 478 that: "… where A promises B for a consideration supplied by B to pay C then B may obtain specific performance of A's promise, at least where the nature of the consideration given would have allowed the debtor to have obtained specific performance. I can see no reason whatever why A in those circumstances should not be bound to perform his promise." 4.2 Are the plaintiffs disentitled to specific performance against Dome because of lack of consideration for the payment obligations? 4.2.1 Is consideration necessary? 4.2.2 Is there sufficient consideration? 121 However, equity will not specifically enforce an agreement which is not a valid and binding contract and will not specifically enforce a contract for which there is no consideration. At common law the fact that an obligation is contained in a deed under seal replaces the necessity for consideration. That is not the case in equity. In equity a seal does not make good a want of consideration: Jefferys v Jefferys (1841) Cr & Ph 138; 41 ER 443; and see generally Meagher, Gummow and Lehane at [20-025]. The defendants objected that the contract in question is not valid and binding on Dome (apart from the seal) because of want of consideration. The defendants did not seriously contest that Mr Silver promised that he would continue as a director of Dome and would continue to furnish consulting services to it, if given the entitlement to benefits as promised by the retirement deed and the varied retirement deed. I find on the evidence that he did make those promises. However, the defendants said that he was free at all times to resign his directorship and to cease providing consulting services to Dome at a moment's notice: he could have done so the very next day. In light of this, they say that his promises which Mr Silver relies on as providing consideration are of no value whatever and therefore do not constitute valuable consideration. 122 There has been a deal of recent discussion as to whether a "practical benefit" or "factual benefit" or the avoidance of a "disbenefit" or detriment may operate as valuable consideration. That debate has largely taken place in relation to promises by a contracting party to continue to perform or to perform on time obligations to which the party was already contractually subject. 123 In making factual findings in relation to the questions of whether there was consideration or sufficient consideration, it will be necessary to assess the situation taking into account the whole of the context in which it is necessary to make those factual findings. That context was as follows. 124 Mr Silver was involved in the Tolukuma project and the establishment of the Tolukuma mine from the very start; indeed, he brought the project to Dome. Mr Silver was a person with long experience and with considerable contacts in the mining industry, having generally been engaged in the industry since about 1970. His experience, knowledge and contacts were in the view of other directors of Dome of high value in the conduct of the Tolukuma mine. In mid 1998, when a director of Dome, he formed the view, and communicated it to Mr Boyer, that his remuneration for the services he was rendering to Dome was inadequate and that he was not prepared to continue devoting to Dome the degree of time and effort that he had been devoting, unless remuneration arrangements were improved. Following that communication, Mr Boyer indicated an intention to confer a retirement benefit on each director equal to his remuneration during his last three years of service. In early 1999, Mr Silver received a draft of the retirement deed from Mr Hutt. Mr Hutt assured him that all payments to him and to Goldspark during the three year period prior to retirement would be taken into account in calculating the retirement benefit. A directors' meeting was held on 31 May 1999 and Mr Silver was told that the retirement deed had been approved by Dome. He thereafter continued to furnish consultancy services to Dome. He continued as a director and subsequently became managing director. When he came to stand down as managing director, he was asked to stay on as a non executive director. He agreed to do so, but on the basis that the payment obligations under the retirement deed would be met when he retired as a non executive director and that Fair Choice, which was now the vehicle through which his consulting services were provided, would be substituted for Goldspark as the payee. The retirement variation deed was considered at a board meeting of Dome on 9 May 2000 and Mr Silver was informed it had been approved. It was subsequently executed, including by DRD as guarantor. Mr Silver continued to be a director of Dome and to make endeavours on behalf of the company. 125 This factual context will also be relevant if it becomes necessary to consider the allegation by the plaintiffs of an estoppel. 126 I return to the law relating to consideration as relevant to these proceedings. 127 A promise to perform a contractual duty already in existence is generally not valid consideration. This rule is commonly known as the rule in Stilk v Myrick (1809) 2 Camp 317; 170 ER 1168: see Carter, Peden and Tolhurst, Contract Law in Australia (5th ed, 2007) at [6-44]. The principle was stated by Mason J in Wigan v Edwards (1973) 47 ALJR 586 at 594 as follows: "The general rule is that a promise to perform an existing duty is no consideration, at least when the promise is made by a party to a pre-existing contract, when it is made to the promisee under that contract, and it is to do no more than the promisor is bound to do under that contract. The rule expresses the concept that the new promise, indistinguishable from the old, is an illusory consideration. And it gives no comfort to a party who by merely threatening a breach of contract seeks to secure an additional contractual benefit from the other party on the footing that the first party's new promise of performance will provide sufficient consideration for that benefit." See also Carter, Peden and Tolhurst at [6-41]. 128 However, in Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1 the English Court of Appeal held that "the existing duty rule will not apply if the promisor receives factual benefits from the performance of the duty, or the promisor avoids a 'disbenefit' which might have resulted from the other party's failure to perform": see Carter, Peden and Tolhurst at [6-48]. Glidewell LJ expressed the test as follows at 15 - 16: "(i) if A has entered into a contract with B to do work for, or to supply goods or services to, B in return for the payment by B; and (ii) at some stage before A has completely performed his obligation under the contract B has reason to doubt whether A will, or will be able to, complete his side of the bargain; and (iii) B thereupon promises A an additional payment in return for A's promise to perform his contractual obligations on time; and (iv) as a result of giving his promise, B obtains a practical benefit, or obviates a disbenefit; and (v) B's promise is not given as a result of economic duress or fraud on the part of A; then (vi) the benefit to B is capable of being consideration for B's promise, so that the promise will be legally binding." 129 This test was adopted with modifications by Santow J, as his Honour then was, in Musumeci v Winadell Pty Ltd (1994) 34 NSWLR 723. In that case, Santow J at 745 observed, after considering the authorities, that "Williams v Roffey and subsequent cases … have been at pains to treat Stilk's case as still good law, though only 'where there is a wholly gratuitous promise.'" His Honour referred to Anangel Atlas Compania Naviera SA v Ishikawajima-Harima Heavy Industries Co Ltd (No. 2) [1990] 2 Lloyd's LR 526 per Hirst J at 545. 130 Santow J then considered what is "a sufficient practical benefit to B, so as to take the situation beyond a wholly gratuitous promise by B". By way of answer, his Honour restated Glidewell LJ's test with some additions. His Honour's statement at 747 (with his Honour's additions italicised) is as follows: "The present state of the law on this subject can be expressed in the following proposition: (i) If A has entered into a contract with B to do work for, or to supply goods or services to, B in return for the payment by B, and (ii) At some stage before A has completely performed his obligations under the contract B has reason to doubt whether A will, or be able to, complete his side of the bargain, and (iii) B thereupon promises A an additional payment or other concession (such as reducing A's original obligation ) in return for A's promise to perform this contractual obligation at the time, and (iv) (a) As a result of giving his promise B obtains in practice a benefit, or obviates a disbenefit provided that A 's performance, having regard to what has been so obtained, is capable of being viewed by B as worth more to B than any likely remedy against A (allowing for any defences or cross-claims), taking into account the cost to B of any such payment or concession to obtain greater assurance of A's performance , or (b) as a result of giving his promise, A suffers a detriment (or obviates a benefit) provided that A is thereby foregoing the opportunity of not performing the original contract, in circumstances where such non-performance, taking into account B's likely remedy against A (and allowing for any defences or cross-claims) is capable of being viewed by A as worth more to A than performing that contract, in the absence of B's promised payment or concession to A . (v) B's promise is not given as a result of economic duress or fraud o r undue influence or unconscionable conduct on the part of A nor is it induced as a result of unfair pressure on the part of A, having regard to the circumstances , then, (vi) The benefit to B or the detriment to A is capable of being consideration for B's promise, so that the promise will be legally binding." 131 Santow J noted two cases that arose in employment situations. The first was an English case decided in the Industrial Relations Court: Lee v GEC Plessey Telecommunications [1993] IRLR 383. The other was a case decided in the Supreme Court of Victoria: Ajax Cooke Pty Ltd v Nugent SCV Phillips J 29 November 1993 unreported. In both cases the continuation in service of existing employees, thus securing increased employee retention and decreased workplace disruption, was held to be valid consideration in exchange for the provision of or improvement in a severance payment or redundancy package. In Ajax Phillips J said: "The benefit to the plaintiff [the employee] is obvious. As for the defendant [the employer], was it not open to infer that, in posting notice of the redundancy package, and thereby announcing the benefits to be paid during the relevant period, the defendant acted to secure some benefit or advantage to itself, whether by inducing its employees to refrain from further industrial disputation or by encouraging them to continue in their present employment? After all, as was said by Lord Hailsham, LC, in Woodhouse AC Israel Cocoa Ltd v Nigerian Produce Marketing Co Ltd [1972] AC at 741 at 758 (quoted by Purchas LJ in Williams at 21):- 'Businessmen know their own business best even when they appear to grant an indulgence ...'" 132 The circumstances of those decisions were quite similar to the present case. Although there the employees were taken to be under continuing contractual obligations, there is no indication in the reports that the employees were under contracts for lengthy terms and were not simply able to leave at short (eg, a week's or a month's) notice. 133 Whilst, as I have said, the bulk of the above discussion has been in the context of situations where there has been said to be a binding legal obligation in existence between the parties, I do not see that the provision of a practical benefit as constituting valuable consideration for the purpose of the creation of a binding contract should be limited to such circumstances. That this is so appears to me to be confirmed by the recent decision of the Court of Appeal in Tinyow v Lee [2006] NSWCA 80. There the Court (Santow JA, with whom Handley and Ipp JJA agreed) at [61] expressed the view that the provision of a practical benefit was a sufficient consideration to render binding contractual obligations in a situation where there were no pre existing legal obligations as between the parties. 134 The question in this case therefore becomes whether there was a sufficient practical benefit moving to the defendants for there to be consideration for their promises. 135 Consideration need not be "valuable" for it to be valid or effective to form the basis for a contract. It merely needs to be "legally sufficient"; Carter, Peden and Tolhurst at [6-23]. It has been held that this criterion has been met in some circumstances even by purely nominal consideration: see Carter, Peden and Tolhurst at [6-27]; Thomas v Thomas (1842) 2 QB 851; 114 ER 851; Chappell & Co Ltd v Nestlé Co Ltd [1960] AC 87. 136 But the courts have been willing to infer that a practical benefit was in fact valuable to the party to whom the consideration moved from the fact that that party has extended a concession in response. Santow J in Musumeci observed at 744 - 745 that: "the very fact that a concession is extended by B, without extortion, supports an inference, though by no means conclusively, that consideration from A, in a real and practical sense, has moved that concession. The law is increasingly tending away from the artificial towards the substantive. Such a practical notion of consideration reflects that trend." In Woodhouse AC Israel Cocoa Ltd SA v Nigerian Produce Marketing Co Ltd [1972] AC 741 Lord Hailsham at 757 - 758 said: "The buyers asked for a variation in the mode of discharge of a contract of sale. If the proposal meant what they claimed, and was accepted and acted upon, I venture to think that the vendors would have been bound by their acceptance at least until they gave reasonable notice to terminate, and I imagine that a modern court would have found no difficulty in discovering consideration for such a promise. Business men know their own business best even when they appear to grant an indulgence, and in the present case I do not think that there would have been insuperable difficulty in spelling out consideration from the earlier correspondence." 137 The evidence in this case indicates that Dome was prepared (twice) to promise the payment of a benefit running into hundreds of thousands of dollars to Mr Silver in order to retain his services, without seeking to make a stipulation as to the time during which he should continue to render those services if he were to be entitled to the promised benefit. On the evidence, it is easy to see why Dome should have taken this view. I have indicated that, in general terms, I accept Mr Silver's evidence as to the part he played in the establishment, commissioning and running of the Tolukuma mine. It is entirely reasonable that it would be desired to retain so long as was possible, or certainly for a further period, Mr Silver's services and experience in this regard. In my view, Dome, at the relevant times, considered the practical benefit to be obtained by retaining Mr Silver's services in these circumstances to be valuable. In my view, therefore, Mr Silver's undertaking not to leave immediately, but to continue in providing the services, albeit for an undefined period, did provide valuable consideration for Dome's promises made in the retirement deed and, more relevantly, the varied retirement deed. It should also be borne in mind that Mr Silver did not immediately or quickly terminate those services, but continued to provide them until the end of August 2000. 138 In these circumstances, there is no reason why specific performance of Dome's promise of payment to Fair Choice should not be specifically performed by ordering at the suit of Mr Silver that payment be made to Fair Choice. 4.3 Are the plaintiffs disentitled to specific performance against DRD because of lack of consideration for the payment obligations? 4.3.1 Is consideration necessary? 4.3.2 Is there sufficient consideration? 139 The principles as to the necessity for consideration in order to support relief by way of specific performance as stated in [121] above in relation to specific performance against Dome apply equally to the claim for specific performance against DRD under the guarantee. 140 My conclusion set out below that DRD's guarantee was in fact supported by consideration obviates the necessity of my considering an argument put on behalf of the defendants that the retirement variation deed was not validly executed as a deed by DRD, because DRD is not a company within the meaning of s 127 of the CL or the CA. This argument depends on the definition of "company" contained in s 9 which by paragraph (a) includes bodies registered as foreign companies within the meaning of "company" only for limited purposes. 141 The defendants' contention was that the consideration expressed in the retirement variation deed for DRD's entry into it was that Mr Silver would also enter into the retirement variation deed. But the retirement variation deed did not itself impose any obligations upon Mr Silver. Mr Silver made no promise to serve as a director of Dome or to do anything in return for receiving the benefits. The consideration was thus illusory. 142 The law relating to the consideration for contracts of guarantee is generally similar to the law relating to consideration for contracts generally: O'Donovan and Phillips, The Modern Contract of Guarantee (looseleaf) at [2.1000]; Rowlatt on Principal and Surety (5th ed, 1999) at [2-01]. 143 One of the common forms of consideration for a guarantee is entry into the principal transaction: O'Donovan and Phillips at [2.1100]. The learned authors state: "In cases in which the consideration is the actual act of entering into the principal transaction, the guarantee will only become binding when that act occurs, that is, by the actual supply of goods, the actual making of advances or entering into the lease. If the stipulated act does not take place, the consideration for the guarantee will totally fail." See also Rowlatt at [2-11]. Thus, if the consideration is the supply of goods or services to the creditor and there is no supply of goods or services, then the guarantee may be unenforceable because of a total failure of consideration: see Chan v Cresdon Pty Ltd (1989) 168 CLR 242 per Mason CJ, Brennan, Deane and McHugh JJ at 247; Gobblers Inc Pty Ltd v Stevens (1993) 6 BPR 13,591 per Cohen J at 13,595. And see the lengthy and helpful exposition of these principles in the Court of Appeal in Scott v Forster Pastoral Co Pty Ltd (2000) 35 ACSR 294 at [25] - [36] per Giles JA (with whom Meagher JA and Foster AJA agreed). 144 The practical application of these principles by Sackville J may be seen in Haddad v R W Jordan Pty Limited FCA 20 August 1997 unreported where his Honour said: "… The evidence of both Mr Jordan and the debtor supports the proposition that the creditor agreed with each of the guarantors that, if they signed the guarantee, it would supply the goods required to complete the Castle Hill project. I infer from Mr Jordan's evidence that in fact the creditor supplied the goods, either to Chartspike or Middle East Investments. The promise by the creditor provided the consideration for the execution of the guarantee by the guarantors, including the debtor. Consideration expressed in terms of the future supply of goods may support a guarantee of past indebtedness, as well as of future obligations: Phillips and O'Donovan [sic], at 55 - 56; Breusch v Watts Development Division Pty Ltd (1987) 10 NSWLR 311 (SCt NSW/CA), at 314, per McHugh JA. It is not to the point that the consideration was not recorded in the guarantee itself, since the consideration for a guarantee need not appear on the face of the instrument of guarantee: cf Phillips and O'Donovan [sic], at 51. (The Usury, Bills of Lading, and Written Memoranda Act 1902 (NSW), s 8, provided that the consideration for a guarantee need not appear in writing. That section was repealed in 1990, on the ground that it was unnecessary, having regard to the repeal of the Statute of Frauds requirement that a guarantee be in writing: Usury, Bills of Lading, and Written Memoranda (Repeal) Act 1900 [sic] (NSW); NSW Parl Deb, Leg Ass, 4 April 1990, at 1681.)" 145 It is clear from this case that it is not necessary that the relevant consideration be specified in a written guarantee for it to be treated as consideration for the giving of the guarantee. See also the decision of the Full Court of Western Australia in Lilley v Midland Brick Co Pty Ltd (1992) 9 WAR 339; O'Donovan and Phillips at [2.1050]. 146 In delivering the judgment of the Privy Council in Pao On v Lau Yiu Long [1980] AC 614, Lord Scarman said at 631 - 632: "There is no doubt - and it was not challenged - that extrinsic evidence is admissible to prove the real consideration where (a) no consideration, or a nominal consideration, is expressed in the instrument, or (b) the expressed consideration is in general terms or ambiguously stated, or (c) a substantial consideration is stated, but an additional consideration exists. The additional consideration must not, however, be inconsistent with the terms of the written instrument. Extrinsic evidence is also admissible to prove the illegality of the consideration. In their Lordships' opinion the law is correctly stated in Halsbury's Laws of England , 4th ed, vol 12 (1975), para 1487. The extrinsic evidence in this case shows that the consideration for the promise of indemnity, while it included the cancellation of the subsidiary agreement, was primarily the promise given by the plaintiffs to the defendants, to perform their contract with Fu Chip, which included the undertaking not to sell 60 per cent. of the shares allotted to them before April 30, 1974. Thus the real consideration for the indemnity was the promise to perform, or the performance of, the plaintiffs' pre-existing contractual obligations to Fu Chip. This promise was perfectly consistent with the consideration stated in the guarantee. Indeed, it reinforces it by imposing upon the plaintiffs an obligation now owed to the defendants to do what, at the first defendant's request, they had agreed with Fu Chip to do." 147 The consideration for the guarantee stated in the retirement variation deed, and thus inserted in the varied retirement deed, is Mr Silver's promise to enter into the retirement variation deed, which was in fact carried out. It may be that this is sufficient consideration given by Mr Silver for the retirement variation deed. However, I do not need to determine whether or not the consideration provided by this promise should be characterised as illusory. The promisee may prove that consideration was given for a written guarantee other than that stated in the document. I have found that Mr Silver did promise to continue as a director and to provide services to Dome and that this operated as sufficient consideration for the promises made by Dome. DRD, as Dome's holding company, had the same interest as Dome in securing the continuation of Mr Silver's services as a director of Dome and otherwise. The promises to continue those services are not expressed in the retirement variation deed as consideration for it. But that does not matter. I find that those promises were made as consideration for entry into the deed by both Dome and DRD. Furthermore, Mr Silver did in fact for some months continue in office and act as a director of Dome and made various endeavours on Dome's behalf during that period. There is thus no question of the consideration being illusory or there being a total failure of consideration. 148 I find that there was sufficient consideration for the giving of the guarantee. I am therefore of the view that the guarantee may be enforced by an order for specific performance against DRD. 5 Whether the defendants are estopped from denying the validity of the payment obligations 149 In view of my determinations in paragraphs [138] and [148] above, I do not propose to determine the estoppel claims. To do so would be "to put a fifth wheel on the coach". It would not be desirable to determine a claim that the defendants are estopped from denying the validity of the payment obligations, when I have held that the payment obligations are valid and enforceable. 6 Whether the plaintiffs are entitled to succeed under the provisions of the Trade Practices Act 1974 (Cth) 150 In view of my determination that the first plaintiff is entitled to specific performance of the payment obligations against both Dome and DRD, I do not propose to determine this question. In my view, there are grave difficulties in the way of the plaintiffs getting meaningful relief under the TPA. It may be that they could establish that there was misleading or deceptive conduct within the meaning of s 52, by which they suffered loss, although even this proposition faces difficulties. If they surmounted these hurdles, they would face difficulties in obtaining meaningful relief because, despite a deal of judicial discussion, the law remains that they are not entitled to damages for the non fulfilment of the misrepresentation made: Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1. Conclusion 151 In the result Mr Silver is entitled to orders against both Dome and DRD for the specific performance of the payment obligations. The cross claim should be dismissed. Short minutes should be brought in to give effect to this decision. At that time there can be raised any questions as to: (1) The exact amount of the payment obligations. (2) Interest. 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