Supreme Court New South Wales Medium Neutral Citation: CPB Contractors Pty Ltd v Rizzani De Eccher Australia Pty Ltd [2017] NSWSC 1798 Hearing dates: 4 and 8 December 2017 Date of orders: 19 December 2017 Decision date: 19 December 2017 Before: Ward CJ in Eq Decision: 1. Dismiss the defendant's motion for a stay of the proceedings. 2. Order the defendant within 14 days to sign and return to the plaintiff the Joint Venture Board resolution dated 19 September 2017. 3. Reserve the question of costs. 4. Direct the parties within 28 days to serve short written submissions on the question of costs with a view to the question being determined on the papers. Catchwords: CONTRACT – Interpretation – Whether "urgent" in "urgent injunctive or declaratory relief" is to be read distributively so as also to qualify "declaratory relief" ESTOPPEL – Equitable estoppels – Promissory estoppel – Relief Legislation Cited: Corporations Act 2001 (Cth), s 248G International Arbitration Act 1974 (Cth), s 7(2) Cases Cited: ACD Tridon Inc v Tridon Australia Pty Ltd [2002] NSWSC 896 ACS v Ampolex (1995) 38 NSWLR 504 AED Oil Ltd & AED Services Pte Ltd v Puffin FPSO Ltd (2010) 27 VR 22; [2010] VSCA 37 Anaconda Nickel Ltd v Edensor Nominees Pty Ltd [2004] VSCA 167 Ashton v Pratt (2015) 88 NSWLR 281; [2015] NSWCA 12 Australian Securities Commission v Ampolex (1995) 38 NSWLR 504 Bell Group Ltd (in liq) v Westpac Banking Corporation (No.9) (2008) 39 WAR 1 Byrnes v Kendle (2011) 243 CLR 253; [2011] HCA 26 Cherry v Steele-Park [2017] NSWCA 295 Construction, Forestry, Mining and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; (2001) 203 CLR 645 Costin v Costin (1997) 7 BPR 15,167 CPB Contractors Pty Ltd v JKC Australian LNG Pty Ltd [2011] WASC 112 Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 333 ALR 384; [2015] HCA 26 Cubillo v Commonwealth; Gunner v Commonwealth [2000] FCA 1084 DHJPM v Blackthorn Resources Ltd (2011) 83 NSWLR 728; [2011] NSWCA 348 Dillon v RBS Group (Australia) Pty Limited [2017] FCA 896 Dome Resources NL v Silver [2008] NSWCA 322 Doueihi v Construction Technologies Australia Pty Ltd [2016] NSWCA 105 Electra Air Conditioning BV v Seeley International Pty Ltd [2008] FCAFC 169 Equititrust Ltd v Franks [2009] NSWCA 128 at [73] Franklin v Manufacturers Mutual Insurances (1935) 36 SR (NSW) 76 Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407 Graham H Roberts Pty Ltd v Maurberth Investments Pty Ltd [1974] 1 NSWLR 93 Green v Econia Pty Ltd [2016] SASC 153 Hawcroft General Trading Co Pty Ltd v Hawcroft [2017] NSWCA 91 Henderson v Louttit (1894) 21 R (Ct of Sess) 674 Howbeach Coal Company Ltd v Teague (1880) 5 H&N 157 Hunt v Carew (1649) 21 ER 786 Jefferys v Jefferys (1841) Cr & Ph 138; 41 ER 443 Jones v Dunkel (1959) 101 CLR 258 Jorden v Money (1854) 10 ER 868 Legione v Hateley (1983) 152 CLR 406 Lipman Pty Ltd v Emergency Services Low v Bouverie [1891] 3 Ch 82 Mercanti v Mercanti (2016) 50 WAR 495 Mount Bruce Mining Pty Ltd v Wright Prospecting Ltd (2015) 256 CLR 104; [2015] HCA 37 Newey v Westpac Banking Corporation [2014] NSWCA 319 Orr v Ford (1989) 167 CLR 316 Perry v Anthony [2016] NSWCA 56 Phoenix Commercial Enterprises Ptv Ltd v City of Canada Bay Council [2010] NSWCA 64 Poliwka v Heven Holdings Pty Ltd (No.2) (1992) 8 ACSR 747 Re Alma Spinning Co (Bottomley's case) 1880 16 Ch D 681 Rodger v De Gelder (2011) 80 NSWLR 594; [2011] NSWCA 97 Saleh v Romanous (2010) 79 NSWLR 453; [2010] NSWCA 274 Seeley International Pty Ltd v Electra Air Conditioning BV [2008] FCA 29 Sidhu v van Dyke (2014) 251 CLR 505; [2014] HCA 19 Silver v Dome Resources NL (2007) 62 ACSR 539; [2007] NSWSC 455 Silver v Dome Resources NL (2007) 62 ASCR 539 Spettabile Consorzio Vemeziano de Armamento e Navigazione v Northumberland Shipping Co Ltd (1919) 121 LT 628 Superannuation Board [2011] NSWCA 163 Swiss Screens (Australia) Pty Ltd v Burgess (1987) 11 ACLR 756Sydney Consumers' Milk & Ice Co Ltd v Hawkesbury Dairy & Ice Society Ltd (1931) 31 SR (NSW) 458 Thompson v Palmer (1933) 49 CLR 507 Thorner v Major [2009] 1 WLR 776; [2009] UKHL 18 Van Dyke v Sidhu [2013] NSWCA 198 Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 Westpac Banking Corp v Tanzone Pty Ltd (2000) 9 BPR 17,521; [2000] NSWCA 25 Texts Cited: K Handley, Estoppel by Conduct and Election (2nd ed, 2016, Sweet & Maxwell) JD Heydon, Cross on Evidence (8th ed, 2010) K Lewison and D Hughes, The Interpretation of Contracts in Australia, LawBook Co, 2012 A Robertson, "Three Models of Promissory Estoppel" (2013) 7 Journal of Equity 226 A Silink, "Can Promissory Estoppel Be an Independent Source of Rights?" (2015) 40(1) The University of Western Australia Law Review 39 ICF Spry, Principles of Equitable Remedies (8th ed, 2010) ICF Spry, The Principles of Equitable Remedies (9th ed, 2014) Young, Croft and Smith, On Equity (2009, Lawbook Co) R Quirk et al, A Comprehensive Grammar of the English Language (1991) Category: Principal judgment Parties: CPB Contractors Pty Ltd (Plaintiff) Rizzani de Eccher Australia Pty Ltd (Defendant) Representation: Counsel: N Nicholls SC with H Morrison (Plaintiff) F Hicks SC with D Robertson (Defendant) Solicitors: Corrs Chambers Westgarth (Plaintiff) Clayton Utz (Defendant) File Number(s): 2017/00332074 Publication restriction: Nil Judgment 1. HER HONOUR: This is a dispute between parties to an unincorporated joint venture for the undertaking of design and construction works (the Works) in connection with the widening of the M4 motorway in Sydney. The dispute relates to whether the defendant (Rizzani de Eccher Australia Pty Ltd, to whom I will refer as RdE) is bound to pay a Called Sum of $8.5m for the purposes of the joint venture (the Called Sum Dispute). 2. An anterior issue (raised by RdE's notice of motion seeking a stay of the proceedings) is as to whether the plaintiff (CPB Contractors Pty Ltd, to whom I will refer as CPB) is entitled to invoke the jurisdiction of the Court to determine the Called Sum Dispute or is bound to refer it to arbitration in accordance with the provisions of the parties' joint venture agreement (the Stay Dispute). The Stay Dispute turns broadly on the construction to be placed on the words "urgent injunctive or declaratory relief" in the relevant clause (cl 13.6) and, if the adjective "urgent" is to be read distributively, as to whether the present application is or was urgent at the relevant time(s). Issues 1. The parties have prepared an agreed statement of issues as set out below (for convenience I have used the parties' acronyms rather than identifying them as plaintiff/defendant). Issues arising out of RdE's motion for a stay of proceedings 1 Does CPB by these proceedings "... seek urgent injunctive or declaratory relief ..." within the meaning of clause 13.6 of the Joint Venture Agreement made between the parties on 27 August 2015 (the JV Deed) properly construed? 2 What is the proper construction of clause 13.6 of the JV Deed as to: a. whether the term "urgent" qualifies the entitlement to seek injunctive relief? b. whether the term "urgent" qualifies the entitlement to seek declaratory relief? c. the meaning of the qualifying term "urgent" with respect to the right to seek interlocutory [sic] and/or declaratory relief? 3 Whether the present circumstances are "urgent" within the meaning of clause 13.6? 4 Whether CPB is entitled to final orders for RdE to perform the alleged obligations under the terms of the JV Deed, as sought by paragraphs 4 and/or 5 of the Summons, within the scope of the exception under clause 13.6? Issues arising out of CPB's claim in the proceedings 5 What occurred at the meeting on 19 September 2017 (the JVB Meeting) and subsequently as a matter of fact by reference to the evidence of those involved. 6 Further to [4] above, was there a decision within the meaning of clause 5.4(a) of the JV Deed made at the JVB Meeting, as a result of a vote in accordance with clause 5.6 of the JV Deed, for the payment of a called sum of $8,500,000 on or before 6 October 2017 (the Called Sum). 7 Further and in alternative to [5], did RdE by its conduct at the JVB Meeting and subsequently, as set out in paragraphs 7,8 and 9 of CPB's List Statement, acquiesce and therefore assent to payment of the Called Sum, in the context of clauses 5.3, 5.4, 5.6, 10.1, 20.9 and 20.10, and schedule 1 of the JV Deed. 8 If the answer to [5] and [6] is "no", whether RdE is estopped from denying that there was a decision pursuant to clause 5.4(a) of the JV Deed in respect of the Called Sum by: a. the alleged conduct; and b. the alleged reliance on that conduct by CPB, asserted at paragraph 2 of CPB's Reply. 9 If the answer to any of [5]-[7] above is "yes", whether the Court can or should order RdE to pay the amount of $8,500,000 into the Rizzani CPB Joint Venture Project Account. Summary 1. As to the first set of issues, for the reasons set out below I have concluded that what CPB is seeking in these proceedings is "urgent injunctive or declaratory relief" within the meaning of cl 13.6 of the JV Deed: that the adjective "urgent" in cl 13.6 qualifies both the entitlement to seek injunctive relief and the entitlement to seek declaratory relief; that, irrespective of the claim for declaratory relief, the claim for a mandatory injunction is "injunctive relief" within cl 13.6; that "urgent" imports its ordinary common sense meaning, namely that the relief is sought where the matter is pressing or requires immediate attention (see below at [105]); and that the present circumstances, objectively viewed, are urgent within the meaning of cl 13.6 of the JV Deed in that the Works have not yet been completed, there are third party creditors to whom moneys are owed and, unless sub-contractors are paid outstanding amounts, the requisite statutory declaration as to progress claims cannot be given and there is a risk of disruption to the Project. 2. I accept that the management of the JV is presently dysfunctional but I place less weight on this issue than as to the financial state of the Project as the former has been, to a large extent if not wholly, the consequence of CPB relying on its asserted legal rights consequent upon its contention that RdE is in default under the JV Deed. I do not suggest that it is not open to CPB to rely on its legal rights in this regard but there is a broad analogy between its position and a party seeking to rely on its own breach of contract to terminate the contract; and, in the present case, any urgency as to the status of the JV Board could have been met by the parties continuing to conduct JV Board meetings on a without prejudice basis. 3. As to the second set of issues, I am not satisfied on the balance of probabilities that a binding vote was passed at the 19 September 2017 meeting in accordance with the requirements of the JV Deed, though I find that there was assent expressed in some form at that meeting by one or both of those representing RdE to the proposition that there be payment by the joint venture participants of a Called Sum of $8.5m each on or before 6 October 2017. 4. I find that the conduct of RdE after the 19 September 2017 meeting, by its General Counsel advising on 19 September 2017 that RdE would sign the resolution prepared by CPB and by RdE not alerting CPB prior to 6 October 2017 (when CPB paid the last of its $8.5m Called Sum contribution into the JV's Project Account) that RdE did not consider itself bound to do so, amounted to a promise by RdE that it would sign the said resolution. I find that CPB relied to its detriment on the said promise, by paying its $8.5m contribution to the Called Sum and by not taking steps either to prevent the payment out of the Project Account to third party creditors of that amount or otherwise to invoke the default processes under the JV Deed (which would have prevented the payment out of its contribution of the Called Sum pending resolution of the dispute), prior to the date that it issued the notice of default on 12 October 2017, so as to make it unconscionable in the circumstances for RdE now to resile therefrom. I am satisfied that damages are not an adequate remedy in all the circumstances and that RdE should be compelled now to execute the resolution. 5. I am not, however, satisfied that orders of the kind sought in paragraphs 4 and 5 of CPB's summons should be made. Rather, the relief granted should be limited to an order that RdE sign the resolution prepared by CPB and forwarded to it on 19 September 2017. What happens thereafter may give rise to further disputes but I am not persuaded that the Court should make orders in anticipation of the events that might follow execution of the resolution (and it may well be that any such future disputes will need to be referred to arbitration having regard to the urgency or otherwise of the relief that might then be sought by one or other of the parties and the nature of that relief). 6. As to costs, while CPB has not succeeded in obtaining precisely the relief it sought, it has achieved the outcome that RdE is bound to execute the resolution in question, which was an outcome not possible at this time without the institution of these proceedings and which resolves the uncertainty as to the status of the JV Board at present. Therefore, I am inclined to the view that costs should follow what is in substance the "event" and thus that RdE should pay CPB's costs of these proceedings. However, I will seek submissions on that issue, with a view to determining it on the papers. Background 1. In March 2014, the parties (CPB then being known as Leighton Contractors Pty Limited) were together selected by WCX M4 Pty Limited (WestConnex) to submit a tender for the design and construction of the WestConnex M4 Widening (the Project). They entered into an arrangement on 11 April 2014 to work together to lodge a tender for the Project. On 28 November 2014, they were selected as the preferred contractor to enter into the contract for the delivery of the Project and, on 4 December 2014, they entered into a contract with WestConnex as principal to perform the Works (the D&C Deed). 2. On 27 August 2015, the parties entered into a Joint Venture Deed (the JV Deed) by which they formed an unincorporated Joint Venture (JV) (see cl 2.1) and set out the basis upon which they would work together as a joint venture to perform their obligations pursuant to the contract with WestConnex (see recital E to the JV Deed). Pursuant to cl 3.4.1 of the JV Deed, each of the parties agreed to co-operate with and to act in good faith towards the other party. That clause included a definition of "good faith" for the purposes of the JV Deed (including: being fair, reasonable and honest; and doing all things reasonably expected to give effect to the intention of the deed). JV Deed 1. Clause 5 of the JV Deed provides for the management of the JV. It provides (cl 5.1) that the parties must exercise overall supervision and control of the JV through the JV Board established for that purpose in accordance with the deed and that the JV Board has the powers and responsibilities given to it under the JV Deed. 2. The JV Board is comprised of two "Representatives" for each of the parties or such other number of persons as the parties may agree from time to time (cl 5.2.1). "Representative" (with a capital "R") is a defined term in the agreement (cl 1.1) meaning a representative appointed to the JV Board pursuant to cl 5. Clauses 5.2.2 and 5.2.3 identify the respective parties' initial Representatives on the JV Board. Clause 5.2.4 provides that, inter alios, the Project Director, Deputy Project Director and members of the JV Team must not be Representatives on the JV Board. 3. JV Team is defined as the project team appointed pursuant to cl 6. It comprises the Key Personnel appointed by the JV Board for the purposes of the venture (cl 6.2.1; Schedule 4). Suffice it note that the JV Team includes the Project Director, Deputy Project Director and Commercial Manager. 4. Pausing there, as at 19 September 2017, the Representatives for each party constituting the JV Board were: for CPB, Mr Michael Hughes (the Commercial Manager NSW and ACT for CPB) and Mr Peter Chatburn (a Project Director employed by CPB); and, for RdE, Mr Aurelio Mortoni and Mr Fabrizio Vicario, both directors of RdE. The Project Director for the JV was then, and remains, Mr Patrick McCormack (appointed by CPB); the Deputy Project Director was and remains Mr Enrico Mongili (appointed by RdE). The JV Commercial Manager was then Mr David Simbaqueba. He no longer holds that position. 5. Clause 5.4 of the JV Deed provides that: The JV Board may only exercise its power and duties: (a) by a decision made as a result of a vote at a meeting of the JV Board in accordance with clause 5.6; or (b) by written resolution, which may be in a number of parts but with identical wording, signed by the current Representatives of each Party. 1. Clause 5.5 contains provisions in relation to JV Board meetings, including the requirement that, except as provided in cl 12.4, a quorum for a meeting of a JV Board "is not less than one Representative of each Party, with each party represented in equal numbers". (I note that the clause in its terms does not require an equal number of Representatives, as such, for a quorum; rather it requires that there be not less than one Representative of each Party and representation in equal numbers. This is relevant to consideration of the quorum dispute in due course.) 2. Clause 5.6 (headed "JV Board Decisions") provides that: 5.6.1 All decisions of the JV Board must be made on a "best for project" basis. 5.6.2 Except as provided in clause 12, each Representative has one vote at meetings of the JV Board that are convened in accordance with clause 5.5.4. 5.6.3 The Parties agree that their Representatives have full power and authority to bind that Party as to matters properly decided at meetings of the JV Board. 5.6.4 Subject to clause 12, all decisions of the JV Board will be determined by a unanimous vote. In the event a unanimous vote cannot be reached during a meeting of the JV Board, the meeting of the JV Board will be reconvened within two (2) Business Days to resolve the issue. In the event that a unanimous decision cannot be reached at the reconvened meeting the matter to be resolved will be deemed to be 'deadlocked' and must be dealt with under clause 5.7. 1. Clause 5.7, as indicated in cl 5.6.4, contains provisions to apply whenever the JV Board is deadlocked. 2. Clause 6.1 of the JV Deed deals with the positions of Project Director and Deputy Project Director, again making clear that both the Project Director and Deputy Project Director must not be a Representative on the JV Board (see cll 6.1.2; 6.1.8). The clause contemplates that the Project Director and Deputy Project Director will not be persons employed by the same Party unless directed by the JV Board (cl 6.1.8; see also Schedule 4). 3. Clause 7 of the JV Deed provides for the establishment of one or more Project Accounts. Pursuant to that clause the parties established a JV Project Account with the Commonwealth Bank of Australia (the Project Account), into which income derived by the JV in performing the Works is paid, including cash contributions by the parties in the form of Called Sums as directed by the JV Board under cl 10.1 of the JV Deed. All payments out of the Project Account, including payments to third party creditors, are required to be jointly authorised by the parties (see cl 7.4). 4. Clause 10 of the JV Deed provides for the amount and timing of Called Sums to take account of the principle that the JV "will use its best endeavours to achieve and maintain a positive cash flow in the Budgets for the Venture at the earliest practical date, and thereafter to maintain a cash neutral position" (cl 10.3) and that Called Sums be contributed in proportion to each Party's Participating Interest (cl 10.4). Each Party's Participating Interest is 50% (see cl 1.1). Unpaid Called Sums constitute a debt due and payable by the Defaulting Party and, without limiting any right the Non-Defaulting Party may have, interest is payable at the rate of 5% per annum by the Defaulting Party from the due date up to and including the date of actual payment (cl 10.5). 5. Failure to pay a Called Sum as directed pursuant to cl 10.1 amounts to an Event of Default (cl 12.1), entitling the Non-Defaulting Party to issue a default notice (cl 12.2). During the period that an Event of Default remains unremedied the Defaulting Party loses, among other things, the right to have any Representative attend or vote at any meeting of the JV Board (cl 12.4). Failure to remedy the default arising from a failure to pay a Called Sum within 10 Business Days entitles the Non-Defaulting Party at any time after the expiry of that time immediately to suspend the rights of the Defaulting Party under the JV Deed and the D&C Deed or to terminate the JV Deed (see cl 12.5), without prejudice to any other rights of the Non-Defaulting Party at law and under the JV Deed (cl 12.6). Status of the Project 1. The Project achieved "Opening Completion" under the D&C Deed on 4 July 2017. "Opening Completion" is defined (cl 26.6) of the D&C Deed in effect as meaning the stage when (a) the Project Works or a Separable Portion is complete except for minor defects which: do not prevent the Project Works or the Separable Portion from being reasonably capable of being used for their intended purpose; can be corrected without prejudicing the convenient or intended use of the Project Works or Separable Portion; and which the contractor has reasonable grounds for not promptly rectifying; (b) the Project Works are or a Separable Portion is capable of being opened to the public for the safe, efficient and continuous passage of vehicles; and (c) the contractor has carried out and passed all tests which must necessarily be carried out and passed before the Project Works are of a Separable Portion is opened to the public for the safe, efficient and continuous passage of vehicles. 2. As to "Construction Completion" (also defined in cl 26.6 of the D&C Deed), as at the date of the hearing, this was imminent (it had been forecast to occur on 30 November 2017) but had not yet been achieved. The term "Construction Completion" is defined by reference to completion of the Works "except for Defects not known". Following "Construction Completion", there will be a defects rectification period (see [131] below) (hence the significance attached by CPB, as I understand it, to the meeting of sub-contractor payments in a timely fashion, so that neither Construction Completion nor the defects rectification process and hence overall completion of the Project is at risk of disruption). 3. The parties agree that the Project is a loss-making project. RdE estimates its 50% share of the loss on the Project to be approximately $86.4 million. In that regard, RdE has for some time been critical of CPB's management of the project (and CPB accepts that it has been aware of this criticism). RdE has notified CPB that it holds CPB responsible for the losses that the JV has suffered, which it blames on CPB's mismanagement of the Project and has itself issued a notice of breach to that effect (by letter dated 9 November 2017). It seems likely therefore that the present proceedings will not be an end to the disputes between the parties. November 2016 JV Board meeting 1. Towards the end of 2016, at a JV Board meeting held via teleconference on 25 November 2016, the attendees were considering measures to take in light of the "great economic loss forecast"; and a decision was recorded as having been made to postpone payments to partners until payment from the client (following "Novation sign off") was received and that the payments to partners were to be "defined" in the light of the outcome of negotiations with the client. The Project Director (Mr McCormack) is there recorded as having explained that the cashflow situation was such that the Project was going to need funds in mid December (2016). 2. The General Counsel of the RdE Group of Companies (Mr Simone Bagnariol), who attended the November 2016 JV Board meeting, accepted in cross-examination that throughout 2017 issues as to the management of costs and maintenance of projected outcomes, amongst other things, occupied the JV Board management and the JV Team (T 21.16); and that the performance of the Project and the costs being incurred to perform the Works, and how they were to be managed, were "major items of consideration or at least on the minds of the joint venture partners" throughout 2017. 3. Pausing there, I note that Mr Bagnariol has never been an RdE Representative on the JV Board and, though he says he has attended numerous meetings of the JV Board in his role as General Counsel, his evidence is that he has never been entitled to vote in respect of JV Board decisions or to sign JV Board resolutions (see his 21 November 2017 affidavit at [4]). August 2017 JV Board meeting and August Called Sums 1. By August 2017, RdE was pressing CPB, among other things, for an updated cash flow plan including a reasonable plan for the management of outstanding payments and a detailed breakdown of the remaining activities cost versus the original budget cost to complete the project updated on weekly basis. 2. A JV Board meeting was held on 25 August 2017 by teleconference. At that meeting a Called Sum of $6.5m from each of the parties was discussed and (as is apparent from the draft minute later prepared by Mr Bagnariol – see [37]-[40] below) agreed. (Mr Hughes in cross-examination noted that this minute had not yet been agreed.) 3. Following that Board meeting, on 29 August 2017, Mr Hughes emailed the JV Board members (copied, among others, to Mr Bagnariol), stating: Please find attached for your signing and return following our Called Sum resolution made in the 25 August 2017 JV Board meeting. 1. The attachment was not identified but presumably it was a formal resolution in relation to the August Called Sum, because Mr Bagnariol responded a few minutes later by email: We confirm what has been agreed during the BoD Meeting with reference to the called sums. But I would like to prepare the minute of all the discussions held. Could you therefore be so kind to send me the soft copy of the resolution that you prepared so I can implement it? 1. Later that day, Mr Franco Alzetta (the Managing Director of RdE) emailed in relation to the August Called Sums to say that "[i]n the mean time we confirm that we are arranging for the payment within the week". 2. The August Called Sums were paid by both parties on 6 September 2017. (Reliance is placed by CPB on the procedure adopted in relation to this Called Sum to set the context in which the September Call Sum was, it says, agreed. Whether or not that past practice informs the conclusion as to whether a binding agreement was reached at the September 2017 JV Board meeting, and I am of the view that it does not, it certainly sheds light on the willingness of CPB to proceed with its payment of the September Called Sum in advance of a formal signed resolution to that effect.) Project Director's request for a September Called Sum to be agreed by JV Board 1. Two days later (on 8 September 2017), Mr McCormack emailed the JV Board members and others (identifying the importance of the message as "High") in relation to Called Sums, stating: Refer to the attached Cash Flow template that illustrates the required Called Sums. Several points to note; 1. The Called Sum of $8.5m requested for 14 Sept, is required to allow the Statutory Declaration related to the progress claim to be signed. The Cash Flow reflects this sequence of payments – Called Sums received, Progress Claim paid following week. 2. The Cash Flow is based upon receiving a Progress Claim of circa $12m on 22 Sept. This includes a payment of $8.9m of the $10.9m completion payment ($2m held for defects by SMC). 3. The Cash Flow is based upon bringing creditor payments up to date to ensure no risk of legal action against the JV. 4. The Cash Flow is based on partner payments (CPB & RdE outstanding claims) being made at end November 17. 5. Dates have been given for when the Called Sums are required. The current state of the payments requires that these are paid on-time to avoid further subcontractor issues. 6. The project currently has outstanding liabilities of $77m, with an equity shortfall of $64m. Please urgently meet and confirm the Called Sum agreement. Without this commitment, we at site can no longer manage subcontractor & supplier expectations and are placing the project at risk. [my emphasis] Draft minute of August JV Board meeting 1. At some time before 25 August and 11 September 2017, Mr Bagnariol prepared a draft minute of the 25 August 2017 Board meeting, which he emailed to the JV Board members and others on 11 September 2017 in advance of the Board meeting to be held "tomorrow". (As the draft minute itself notes the next meeting as being on 11 September 2017, it is possible that the timing of the email communications does not take account of the time difference between Australia and Italy. What nonetheless appears from the emails is that there was a telephone "hook-up" on 11 September 2017, not 12 September 2017 as Mr Bagnariol's 11 September email would suggest.) 2. The draft minute of the 25 August meeting that was forwarded to the JV members on 11 September 2017 records that the Project Director, Mr McCormack, had explained to the JV Board the "current status with negotiations" with the client's representatives about the outstanding amounts to be paid to the JV ($10.9m) and a possible compromise being for the JV to accept two instalments (one in September and one in October) on condition that the client formally recognise the achievement of Opening Completion. 3. The minute makes reference to a "possible cash flow" that the Project Director (Mr McCormack) remembered sending to the partners showing the amounts necessary and to Mr Franco Alzetta (of RdE) saying that "the Partners agreed to provide the JV with a cash injection of AUD $6.5m each, to be executed by the end of August". The minute went on to note that: In the meantime [i.e., before the end of August], the Board will try to better understand what is the situation with the customer and of the relevant payments. After a possible agreement with the client or a better understanding of the payments, the JV shall have to update the cash flow of up to the end of the project. 1. The minute also recorded that Mr Martin Wood (of CPB) had highlighted that by the end of August there would be an exposure of $35m "of cost overdue" so that an additional contribution would be needed from the partners and that Mr Bagnariol had replied that "we are asking to the Partner to commit today to an additional contribution when we are completely unable to forecast the CTC even if the works have already been handed over to the client". Mr Alzetta is recorded as suggesting to Mr Enrico Mongili (the Deputy Project Director appointed by RdE) and to Mr McCormack "to identify the necessary and urgent payments to be made to the suppliers in a realistic way". September 2017 JV Board teleconference 1. On 12 September 2017, Mr McCormack emailed the JV Board members following "yesterdays phone hook-up" [sic] to advise that the Called Sum table had been revised. In that email, he stated: 1. Cash Flow revised based upon receiving the client $10.9m outstanding payment prior to next Called Sum, therefore reducing and delaying the payment. 2. Next Called Sum delayed from 14 Sept to 21 Sept. 3. Stat Dec will then be able to be signed and August Progress Claim of $3m able to be received. Please urgently meet and agree the Called Sums. The project cannot manage the current situation without certainty of funding. [my emphasis] In addition: - The release of the $10.9m is based upon the execution of Sch 4. At site we will amend Sch 4 to include Asphalt Joint Defects. 1. Pausing there, the significance of a statutory declaration being signed (to the effect that all subcontractors had been paid) goes to whether a progress claim by the JV would be met by WestConnex, such a declaration being a pre-requisite under the D&C Deed. 2. A draft minute of the 11 September 2017 Board meeting was prepared by Mr Bagnariol. In that minute, reference was made to the ongoing dispute as to the claim for payment from the client of the $10.9m. Mr McCormack confirmed that Schedule 4 (necessary to establish what was necessary for payment by the client of the $10.9m) could not be signed as there were still two items not closed with the client. There was a discussion in relation to the cash flow and cash call. The minute noted: PmC explains that the overdue amount due to Subs at the end of September shall amount to AUD 28 mio. PmC also underline that he will be considered liable for the Statutory Declaration to be sent along with the IPC and that if a subcontractor applies to SOPA or goes to Court it will be demonstrated that he signed a false Statutory Declaration he will be disqualified for being a Company Director of whatever company plus a AUD 50k fine to him. There is also the problem of not having subcontractors on the job due to the lack of payment or for having promised them certain payments which have not been executed due to the delay of the partners in financing the JV. For the reasons set forth above, we also did not submit the Statutory Declaration of the month of August 17. As of today the client have not required yet to us such Stat. Dec. … SB proposes therefore to identify which payments have to be made without delay, which payments can be postponed in the next few weeks and then which one can be delayed till the beginning of October when the JV will have hopefully cashed the AUD 10.8 mio from the clients plus the Partners will have already contributed with an additional cash call. [my emphasis] … PMC clarifies that in addition to the money we could receive from the client, we would need in any case a cash call from the Partners every week. … SB summarize therefore that (1) RdE will discuss with MW the amount to be contributed by each Partner; (ii) FA will call Dennis to understand of the application of LD or the other deductions (iii) MH will prepare the draft of Schedule 4 to be submitted to the client; and (iv) in a couple of days the parties will get again in touch to establish the exact amount of cash contribution in one scenario (if the client pay us) or in the worst scenario if the Client will not pay us. PmC confirms that the final cost at completion of the Project will be AUD 553 mio. 15 September 2017 email from Project Director re September Called Sums 1. On 15 September 2017, Mr McCormack again emailed the JV Board in relation to the Called Sums, providing an update and requesting that the JV Board urgently meet and commit to paying $8.5m on or before 21 September 2017. The update was as follows: - The $10.9m completion payment has yet to be paid. There is a meeting next Tuesday … to discuss asphalt defect at joints and treatment of LDs [liquidated damages]. (see my email 13 Sept. on this issue) to enable Sch 4 to be signed. It is now unlikely that we will receive this payment until the last week of this month. - The first review of the Cash Flow had the partners paying $8.5m on 14 Sept;, on basis that the $10.9m would not be received this week. Emailed to JV Board on 8 Sept below. - The second revision of the Cash Flow had the partners paying $6.5m on 21 Sept on basis that the $10.9m would be received this week. Emailed to JV Board on 12 Sept below. - Accordingly, the project now requests that the original Cash Flow be considered, and $8.5m per partner be made available. 1. The email also noted that the August Progress Claim was valued at $1.32m ($716,000 deducted for asphalt defect/incomplete, $1.5m deducted for LDs); that payment will not be made whilst statutory declaration outstanding "so unlikely to be paid this month"; and that "[t]he current legally overdue amount (excluding partner payments) is circa $28m". Mr MrCormack further stated that the JV was "in breach of our contract [with the client, WestConnex] and subcontracts". 19 September 2017 JV Board meeting 1. As is apparent from the correspondence referred to above, by the time the 19 September JV Board meeting was convened, both JV partners were well aware of the urgency being expressed by the Project Director (Mr McCormack) for another cash call in order to meet sub-contractor payments (and to enable the statutory declaration to be signed on which the further progress payment from WestConnex was dependent). Mr Bagnariol's minute of the 11 September 2017 JV Board meeting (as italicised above) itself contemplated an additional cash call payment by October 2017. 2. On 19 September 2017, Mr McCormack issued an email invitation for the JV Board to meet by teleconference on 19 September 2017 at 4pm to discuss and agree upon the payment of a Called Sum of $8.5m per partner by 21 September 2017. 3. The JV Board meeting was convened for 4pm (Sydney time) on 19 September 2017 by way of teleconference (with an anticipated duration of half an hour). The sole subject matter of the meeting was identified in the email as being: To discuss & agree below: Called Sum of $8.5m per partner due on or before 21 September 2017. 1. The meeting request identified the "required attendees" as the Representatives referred to at [45] above, as well as Mr Alzetta, Mr David Simbaqueba (the JV Commercial Manager); Mr Bagnariol and Mr Martin Wood (of CPB). 2. Earlier on the day of 19 September 2017, (which is relevant to explain some of the evidence given as to the later JV Board meeting), there was a meeting between Mr Mortoni, Mr Wood and one or more representatives from WestConnex to discuss the dispute as to a claimed $10.9m bonus payment from WestConnex. It is accepted by both parties that the quantum and timing of that bonus payment were matters relevant to the September Called Sums that Mr McCormack was seeking (see the email from Mr McCormack referred to at [44] above), though Mr Simbaqueba did not accept that the payment of this amount on 29 September 2017 removed the need for the Called Sums. 3. At the commencement of the teleconference the following persons were participants in the conference call: Mr Hughes (CPB's Representative); MrChatburn (CPB's Representative); Mr McCormack (the Project Director); Mr Simbaqueba (the JV Commercial Manager); Mr Mortoni (RdE's Representative); and Mr Bagnariol (RdE's General Counsel). There is no suggestion that Mr Vicario (RdE's other Representative) was present or participated in the teleconference. 4. However, Mr Mortoni says (for the first time in the context of these proceedings) that he left the meeting (while it was continuing via teleconference) for about 15 minutes to participate in a call on a different project. He did not announce that he was leaving the meeting and there was no evidence from anyone at RdE who was at the RdE Sydney office who could corroborate this. Nor was there any evidence from the person(s) on the other telephone call that Mr Mortoni said he left the JV Board meeting teleconference to take. I consider this issue further in due course. 5. What occurred in the course of that teleconference is hotly in dispute. CPB asserts, and RdE denies, that during the teleconference it was agreed that a Called Sum (of $8.5m) would be paid by each of the parties by 6 October 2017. Mr Bagnariol did accept that there was a discussion about Called Sums (though he did not recall in the witness box the amount that was discussed) and said he left the meeting with the "impression" that a resolution would be prepared (for a Called Sum) (see [197] below). 6. There were in evidence copies of notes taken by each of Mr Hughes; Mr Chatburn; and Mr Simbaqueba, during or at around the time of the meeting. I will consider those notes, and the evidence of those persons participating in the teleconference (other than Mr McCormack who was not called by either party to give evidence) in due course. Preparation of draft resolution 1. At 4.38 pm on 19 September 2017 (therefore only shortly after the meeting had been scheduled to finish), Mr Hughes sent an email to Mr Mortoni, copied to various others, including Mr Bagnariol, attaching a JV Board Resolution which had been prepared by Mr Hughes (and signed by both Mr Hughes and Mr Chatburn) for the payment of a Called Sum in the amount of $8,500,000 into the Project Account on or before 6 October 2017 (the Called Sum). The email stated: Aurelio, Could you please sign the attached and return documenting the JV Board's resolution of today. Regards Michael Hughes [my emphasis] 1. The document attached to the email, entitled "JV Board Resolution" and dated 19 September 2017, relevantly provided: Called Sum - September 2017 This paper confirms that the RdE CPB JV Board resolved in a JV Board Meeting held on 19 September 2017 to the payment of Called Sums to the Project Account in the amount of ($8,500,000 AUD from each Party) paid on or before 6 October 2017. JV Board approval of this resolution is ratified below: Aurelio Mortoni …………… Fabrizio Vicario …………… Michael Hughes [signed] Peter Chatburn [signed] [my emphasis] 1. Six minutes later (at 4.44 pm on 19 September 2017), Mr Bagnariol responded with an email to Messrs Hughes and Mortoni in the following unequivocal terms: Yes, we will do it along with the Minute of the Meeting. 1. On 20 September 2017, Mr Bagnariol forwarded a draft of the minute of meeting held on 11 September and said that the "MoM of the BoD of today will follow tomorrow". (I was not taken to any minute of the 19 September meeting, from which I infer that none has been agreed, perhaps not surprisingly in light of the present dispute.) Payment by CPB of its contribution to the September Called Sums 1. On 22 September 2017, CPB paid the sum of $1,500,000 into the JV Project Account towards the Called Sum. Between 22 September 2017 and 4 October 2017, there were payments out of the JV Project Account. On 6 October 2017, CPB paid a further $7,000,000 into the JV Project Account completing its contribution of the Called Sum. According to Mr Simbaqueba, the amount of CPB's Called Sum ($8.5m) paid into the Project Account had been fully disbursed to creditors by the end of October 2017 (his affidavit of 8 November 2017 at [10]-[13]; [13] being read as his assertion, subject to weight). 2. On 6 October 2017, Mr Hughes emailed Mr Mortoni (copied to Mr Bagnariol and others) referring to the Called Sum of 19 September 2017 in the amounts of $8.5m from each party; stating that CPB had paid its share of the Called Sum and that "[a]ppreciate if you could confirm RdE payment timing". 3. Mr Mortoni's response, by email on 9 October 2017, was that: we have a couple of days of delay in the cash contribution. We are confident to do it in the next few days. We will keep you updated on the exact date. [my emphasis] 1. As it transpired, RdE did not pay the $8.5m Called Sum. Issue by CPD of notice of default 1. On 12 October 2017, CPB issued a Notice of Default under cl 12.2 of the JV Deed, asserting a breach of the JV Deed by RdE in failing to pay the Called Sum. 2. On 19 October 2017, Mr Mortoni wrote to CPB responding to the Notice of Default, rejecting the allegations made in that notice, disputing any obligation to pay the Called Sum. It was asserted that neither of the conditions in cl 5.4 of the JV Deed was satisfied in respect of the Alleged Called Sums and therefore the JV Board had no power to direct the parties to pay the Alleged Called Sums and the parties were not obliged to do so under cl 10.1 of the JV Deed. 3. Pausing there, insofar as the letter made express reference to the requirements of cl 5.4(a) (that there be a decision made as a result of a voting at the meeting of the JV Board) and cl 5.4(b) (that there be a written resolution "signed by the current Representatives of each Party"), what the letter clearly conveyed was an assertion that there had been no decision made as a result of a "vote" and no signed written resolution. There was, however, no suggestion in that letter (or in any correspondence from RdE prior to the service of its affidavits in these proceedings) that one reason that RdE disputed that any decision had been made (or any agreement had been reached) for the payment of the Called Sum was that Mr Mortoni had, as he now says he did, absented himself (without informing any of the teleconference participants) from the teleconference for a portion of that teleconference and, fortuitously otherwise, had missed that portion of the teleconference in which the discussion as to the Called Sums (which Mr Bagnariol accepts took place) had occurred. This is despite, on the evidence of Mr Mortoni, Mr Bagnariol having been apprised of what had happened within about 2 minutes of the end of the teleconference (and, if so, before Mr Bagnariol had sent his email to Mr Hughes confirming that RdE would do what had been requested (i.e., sign and return the attached resolution). Subsequent events 1. On 16 October 2017, CPB corrected (or "clarified") an error in the default notice, as to the date by which it required RdE to remedy the event of default (stating that the date specified should have been 19 October 2017 and then specifying 20 October 2017 as the date by which the default should be remedied). 2. By email on 18 October 2017, Mr Hughes requested the convening of an urgent JV Board meeting to discuss and resolve, among other matters, RdE payment of current Called Sum and resolution of future Called Sums. The email noted that the meeting must be convened no later than 25 October 2017 in accordance with the requirements of cl 5.5 of the JV Deed. 3. There followed further correspondence in which CPB maintained its position that RdE was in breach of the JV Deed by failing to pay the Called Sum (see its letter dated 23 October 2017 to RdE), though also maintaining its request that a JV Board meeting be convened by no later than 25 October 2017) and RdE maintained its denial of any obligation to pay the Called Sum (see letter dated 25 October 2017), RdE there advising that an RdE Representative was not available to attend a Board meeting on 25 October 2017 but would be available in the first week of November 2017. 4. CPB commenced the present proceedings on 2 November 2017. Following the commencement of the proceedings, CPB gave notice by letter dated 8 November 2017, for the convening of a JV Board meeting to be held no later than 15 November 2017, one of the items or the agenda for which was the RdE $8.5m Called Sum. 5. RdE then issued its letter of 9 November 2017, to which I have earlier referred, alleging mismanagement of the project by CPB and breach by CPB of the JV Deed (and claiming that CPB is liable to RdE under the indemnity in cl 11.1.1 of the JV Deed or in the alternative for damages for breach of the JV Deed in the amount of $86.403m). 6. CPB then responded to requests by RdE to confirm the scheduled Board meeting for 15 November 2017 by stating that "the proposed meeting of 15 November 2017 is annulled"; though agreeing to meet with RdE on 23 November 2017 "not as a board meeting" and without prejudice to CPB's rights and entitlements under the JV Deed arising from RdE's failure to pay the Called Sum of $8.5m. 7. RdE's position, as set out in an email of 22 November 2017 was that: If CPB and RdE will be able to identify truly critical payments that need to be made in the best interests of the JV and the Project, then RdE will definitely agree to make a voluntary contribution of funds to the JV, just as it did in respect of the recent ATO liability, while the parties continue to discuss the alleged Called Sums and the other pending disputes among the parties. 1. The reference in that email to a payment to the ATO was a payment to which each party had contributed towards a tax liability of the JV. 2. RdE pressed for a response from CPB in relation to the proposed Board meeting. CPB's response was that RdE could best assist critical subcontractor payments by paying the Called Sum and that the dispute was likely to be determined imminently, and thereafter, if appropriate, a further JV Board meeting "may be convened". 3. The upshot of all of this is that there has been no meeting of the JV Board since 19 September 2017. 4. As noted earlier, as at the date of commencement of these proceedings, and indeed as at the dates of the hearing before me, the Project had not achieved "Construction Completion" as defined by the D&C Deed, though it is said to be imminent. Issues for Determination Stay Dispute 1. Logically, the Stay Dispute should be determined first. Four issues arise in that context. 1. Does CPB seek urgent injunctive or declaratory relief within the meaning of cl 13.6 of the JV Deed as properly construed? 1. This issue turns upon the conclusions on the second and third of the issues in the agreed statement of issues. Suffice it to say that, for the reasons set out below, the answer to this question is "yes" and hence the application by RdE for a stay of the proceedings should be dismissed. 2. Proper construction of cl 13.6 of the JV Deed 1. CPB accepts that the dispute resolution procedures in cl 13 of the JV Deed contain an arbitration agreement (cl 13.5) which, subject to the operation of cl 13.6, would require these proceedings to be stayed and the issues in these proceedings to be referred to arbitration as required by s 7(2) of the International Arbitration Act 1974 (Cth). 2. Clause 13.5 (headed "Arbitration") provides that: Any dispute, controversy or claim arising out of, relating to, or in connection with this Agreement, including any questions regarding its existence, validity or termination, must be resolved by arbitration to be conducted in accordance with the Rules of the International Chamber of Commerce. The seat of the arbitration will be Singapore. Any hearings may take place in any other convenient venue agreed by the Parties or as ordered by the arbitral tribunal. The language of the arbitration will be English. The number of arbitrators will be three to be appointed in accordance with the said rules. The arbitrators' award shall be final and binding on the Parties. 1. Clause 13.6 (headed "Urgent or Injunctive Relief") then provides: Nothing in clause 5.7 or this clause will prejudice the right of a Party to seek urgent injunctive or declaratory relief from a court of competent jurisdiction in accordance with the provisions of clause 22.2 of this Deed. 1. Clause 5.7 is the deadlock provision to which I have already adverted. Clause 22.2, read with the definition of "Location" in cl 1.1, provides that this Court is the relevant court in which relief may be sought under cl 13.6. Legal principles 1. There was no dispute as to the principles of construction to be applied in the present case, namely that the meaning of commercial documents is to be determined objectively, by reference to what a reasonable person in the position of the parties to the transaction would have understood them to mean; which requires consideration not only of the text, but also of the surrounding circumstances known to the parties and the purpose and object of the transaction (see Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37 at [46]-[51]), and that commercial agreements should be given a businesslike or commercial construction which does not flout business commonsense (see Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7 at [35]). The ostensible meaning of language in a contractual term prevails unless its application produces a result which is plainly absurd in which case the Court will endeavour to apply any interpretation to avoid that absurdity (Westpac Banking Corp v Tanzone Pty Ltd (2000) 9 BPR 17,521; [2000] NSWCA 25 at [19]-[22]). 2. See also the recent consideration of the relevant principles by the Court of Appeal in Cherry v Steele-Park [2017] NSWCA 295. There, it was observed that "[t]he starting point and the ending point of the construction of a written commercial contract is the language chosen by the parties record their bargain" (at [72]) and that the "ultimate question" is whether the written language, "when considered in light of legitimately relevant surrounding circumstances, permits a constructional choice" between "different legal meanings" (at [75]) (and see Leeming JA at [76]). 3. There is no particular rule of construction requiring a liberal approach to be applied in the interpretation of arbitration agreements; rather, any such approach remains subject to the language used in the clause itself (see ACD Tridon Inc v Tridon Australia Pty Ltd [2002] NSWSC 896 at [121]; Lipman Pty Ltd v Emergency Services Superannuation Board [2011] NSWCA 163 at [8]). CPB submissions 1. CPB argues that the parties have used clear and unambiguous language in cl 13.6 and that the clause is clearly engaged in that in these proceedings it claims both "urgent injunctive" relief and also "declaratory" relief. 2. Insofar as RdE argues that the adjective "urgent" should be applied distributively so as also to qualify "declaratory", CPB submits that this contradicts the clear language of cl 13.6 and that it would lead to a commercially impractical result which the parties could not be presumed to have intended. The so-called commercially impractical result identified by CPB appears to be the outcome that the parties would be deprived of the important and commercially useful remedy of declaratory relief other than were there was a situation of urgency. 3. CPB submits that the nature of declaratory relief is such that it is entirely consistent with the commercial objectives of the JV Deed and the presumed intention of the parties that they reserved a right to seek declaratory relief in circumstances where to do so would resolve disputes arising under the JV Deed in a far more commercially expedient way to arbitration (i.e., without the need for the declaratory relief sought to be urgent). 4. In this regard, CPB points to the recognition by the courts that the jurisdiction to grant declaratory relief is a useful and effective power to be engaged, particularly in circumstances where questions arise as to the validity or continuing enforceability of contractual obligations (referring to what was said in Spettabile Consorzio Vemeziano de Armamento e Navigazione v Northumberland Shipping Co Ltd (1919) 121 LT 628 at [629] (Bailhache J); [635] (Atkin LJ); and to the decision in Graham H Roberts Pty Ltd v Maurberth Investments Pty Ltd [1974] 1 NSWLR 93 where the Court declared in a building case that the defendant owner was entitled to possession of land (at 109B-E) notwithstanding that issues concerning payment or non-payment of progress claims and other related disputes were to be referred to arbitration under the building contract (at 101D-G)). 5. Reference is made by CPB to Seeley International Pty Ltd v Electra Air Conditioning BV [2008] FCA 29, where Mansfield J declined to stay proceedings in which the plaintiff had sought declaratory relief, in circumstances where there was an arbitration agreement containing an arbitration clause to the effect that nothing in the arbitration clause prevented a party "seeking injunctive or declaratory relief in the case of a material breach of threatened breach of this Agreement". There, his Honour said (at [37]): But it does not flaunt business common sense that the parties, having agreed upon arbitrating their disputes, should nevertheless agree upon an optional alternative dispute resolution process — by way of court proceedings — in certain circumstances. There is no inherent commercial reason why certain disputes where declaratory or injunctive relief is sought should not be agreed to be determined by a court. There is nothing to suggest such resolution would or should be less speedy or less efficacious or more expensive. Particularly where the parties have demonstrated such care in arriving at, and expressing, their bargain, the syntactical and semantic analysis of cl 20 as a whole should not be ignored because it suggests a preserved alternative but limited dispute resolution process by court proceedings. The availability of such access to the courts would not defeat the commercial purpose of the agreement; indeed it may serve it; cf per Kirby J in Corumo Holdings Pty Ltd v C Itoh Ltd (1991) 24 NSWLR 370 at 378. 1. On appeal, in Electra Air Conditioning BV v Seeley International Pty Ltd [2008] FCAFC 169, the Full Court of the Federal Court, dismissing the appeal, said at [50]: Moreover, an arbitrator does not exercise judicial power. An arbitrator's powers are defined by the agreement of the parties: Construction, Forestry, Mining and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; (2001) 203 CLR 645 at 658. Whilst it may be accepted that an arbitrator can make an order in an award in the nature of a declaration or an injunction, that declaration or that injunction so made can only be enforced through proceedings in an appropriate court. 1. CPB notes that in Construction, Forestry, Mining and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; (2001) 203 CLR 645 at 658, the Court stated that "[w]here parties agree to submit their differences for decision by a third party, the decision maker does not exercise judicial power, but a power of private arbitration". 2. CPB submits that, although an arbitrator can make a form of declaration (within the confines of legislation and agreement permitting that to occur), it is not "true" declaratory relief in that an arbitrator cannot exercise judicial power. Rather, CPB says it is a form of judgment on an issue or issues, inter partes, that would require separate enforcement in a Court. 3. CPB thus submits that there is no justification for limiting the parties' right to claim declaratory relief to circumstances where it is urgent to do so. 4. CPB acknowledges that the Victorian Court of Appeal held otherwise in AED Oil Ltd & AED Services Pte Ltd v Puffin FPSO Ltd (2010) 27 VR 22; [2010] VSCA 37, where the exception to an arbitration agreement (in terms very similar to that in the present case) was as follows: Nothing in this Article 33 prevents a party from seeking urgent interlocutory or declaratory relief from a court of competent jurisdiction where, in that party's reasonable opinion, that action is necessary to protect that party's right. 1. There, the Victorian Court of Appeal (Buchanan and Bongiorno JJA and Croft AJA) held that the word "urgent", like the word "relief, was used distributively ([26]); that whether relief was in fact urgent was a matter to be determined objectively ([27]), and that the relief sought in the cross-claim in that case was not urgent ([36]). 2. CPB contends that the reasoning of the Victorian Court of Appeal in AED is "problematic". First, it points to the fact that, in resisting the stay, Counsel for the defendant/cross-claimant had there submitted that, because interim or interlocutory declaratory relief is not available at common law or in equity, it then followed that the word "urgent" could not sensibly be construed as qualifying the word "declaratory". CPB contends that such a submission was flawed in that it equated the expression "urgent" with the process by which "interim or interlocutory" relief is sought. CPB argues that the submission out by the Counsel at the hearing deflected the Court's attention away from the correct task (of construing the language of the clause) to a consideration of whether declaratory relief can be granted on an interim basis (the Court holding that such relief is available, referring to ICF Spry, Principles of Equitable Remedies (8th ed, 2010) at 453). 3. CPB submits that the Court in AED (insofar as it reasoned that because interim declarations are available then, logically, the defendant/cross-claimant's submission failed, such that the expression "urgent" could logically be applied to declaratory relief) failed to engage in the correct task of focussing on the clear language used in the relevant exception clause. 4. CPB also argues that there can be no such thing as an interlocutory declaration – the nature of declaratory relief being that it is final. Noting that (at [23]) the Victorian Court of Appeal referred to English authority concerning the power to grant interim declarations, CPB points out that in England, the power to make interim declarations is specifically granted under the Civil Procedure Rules. CPB also argues that the Court's reasoning at [25] (that the type of "urgent declaratory relief contemplated" in that case was of a kind issued in interlocutory proceedings, but which finally determined a matter in dispute, and that the authorities indicated a difficulty in enforcing awards that did not finally determine a matter in dispute) does not sit comfortably with the Court's earlier conclusion that declaratory awards can be enforced (see [18]-[20]). 5. Thus CPB says that the Victorian Court of Appeal equated the word "urgent" with the process by which interlocutory or interim relief is granted (with no justification for so doing). CPB submits that I should not follow the reasoning in AED and that the correct process is to construe the language of the clause by reference to established principles in an endeavour to determine the objective presumed intention of the parties, and having regard to the nature and utility of the remedy in the context in which it is applied in the exception clause. RdE submissions 1. RdE notes that, prior to the advent of the Model Law in Schedule 2 to the International Arbitration Act 1974 (Cth), it was considered that arbitrators lacked the power to award enforceable declaratory relief or to make orders for interim measures (viz. interlocutory injunctive relief) but that it is now accepted that an arbitrator's powers include the making of declarations inter partes and to make an award for interim measures (referring to Seeley International v Electra Air Conditioning at [26]-[27]). 2. RdE argues that therefore, broadly, the purpose of "carve-out" clauses such as cl 13.6 in the context of an arbitration agreement is no longer to ensure that both injunctive and declaratory relief is available to the parties (as it was when it was uncertain if an arbitrator had the power to grant such relief). It argues that the modern purpose of clauses like cl 13.6 is to provide parties with the ability to obtain such relief more swiftly than would otherwise be the case – if the determination of the issue in dispute is in fact urgent and requires immediate attention. 3. RdE places weight on the fact that cl 13.6 of the JV Deed is a provision that commonly appears in the same or similar form in many commercial agreements that contain an arbitration clause such as cl 13.5, and the decision of the Victorian Court of Appeal as to the construction of such a clause in AED (to which I have referred above – see [95]ff above). 4. RdE submits that, consistent with the construction placed on the same or similar wording in AED, the word "urgent" in cl 13.6 should be construed distributively, such that cl 13.6 only entitles a party to apply for urgent injunctive relief and/or urgent declaratory relief; that relief sought by a party is "urgent" only if it is in respect of a matter that requires immediate attention; and that whether the injunctive or declaratory relief sought is "urgent" is a matter to be determined objectively in light of all the relevant circumstances. 5. As to the meaning of "urgent", RdE notes that in Green v Econia Ptv Ltd [2016] SASC 153 at [23], the Court held that a matter is "urgent" if it has "the quality of requiring immediate attention"; and that in CPB Contractors Pty Ltd v JKC Australian LNG Pty Ltd [2011] WASC 112 at [37], the Court described an "urgent" matter as one that is "pressing; compelling or requiring immediate action or attention". Determination 1. The contracting parties in the present case certainly contemplated something narrower than the preservation of a general right "to seek urgent … relief". So broad a construction would ignore the express inclusion of the words "injunctive or declaratory" (which delimit the nature of the contemplated relief) and the reference to a "court of competent jurisdiction" (which delimits the source of that contemplated relief), as well as the inclusion in the JV Deed of clauses dealing with other forms of dispute resolution. 2. It is obvious that the adjectives "urgent" and "injunctive" both qualify the noun "relief", given that it makes no grammatical sense to speak of a preserved right to "to seek urgent injunctive". However, "injunctive relief" is not itself a discrete unit within cl 13.6 – the words "or declaratory" are interposed. 3. Insofar as cl 13.6 as drawn follows a standard form of exception from commercial arbitration agreements (as submitted by RdE – see [103] above), then it is relevant to note that it has been said that courts recognise the desirability of certainty and are therefore reluctant to disturb an established construction (see K Lewison and D Hughes, The Interpretation of Contracts in Australia, LawBook Co, 2012) at [4.08] and the authorities cited therein). That is of course not to deny that in any case the particular clause should be construed on its own terms, in the context of the agreement in question. 4. In my opinion, on the ordinary reading of the clause, the adjective "urgent" should be read distributively as qualifying the succeeding words "injunctive … relief" and "declaratory relief" (just as the word "relief" is to be read in view of the preceding adjectives, though this is of course on the basis that it is the noun of the phrase in question). The clause should be read holistically. 5. In this regard, I note that determiners are often read distributively (for example, "his realty and personalty" would ordinarily be read as "his realty and his personalty") and that a similar approach may follow in the context of modifiers, though this is naturally dependent upon context (for example, "old system title and personalty" would ordinarily be read such that the words "old system" only qualify the noun "title", having regard to the nature of Australian land law) (see R Quirk et al, A Comprehensive Grammar of the English Language (1991) at [13.67]). Ambiguities may, of course, arise. Quirk et al give the example of "old and valuable books", which may mean "'books which are old and valuable' (combinatory meaning) or 'old books and valuable books' (segregratory meaning)' " (see [13.68]). 6. I accept that a "first blush" grammatical reading does not determine the matter. The question therefore becomes whether the content of the words, or their context within the agreement as a whole, otherwise displaces what I consider to be the ordinary grammatical meaning of the text. That might arise, for example, if the concept of "urgent … declaratory relief" were, in view of the terms of the relevant contract, unlikely to be the subject of an intended carve out clause (and see T 145.31-38); or if, in view of the law relating to declarations and with due regard to the contract in question, it is unlikely that the parties intended to invoke such a concept. 7. As to the first, I accept that it may well make commercial sense, in certain commercial contexts, for parties to include a carve-out clause pertaining to "declaratory relief" without limiting that by reference to a concept of "urgency". However, "[t]he starting point and the ending point of the construction of a written commercial contract is the language chosen by the parties to record their bargain" (Cherry v Steele-Park [2017] NSWCA 295 at [72]). That is not to gainsay the authorities (noted above) concerning the role that notions of "commercial purpose" or "business common-sense" may play in an appropriate case. It merely directs attention to the fact that the parties in the present case chose to preface the words "injunctive … relief" and "declaratory relief" with the adjective "urgent". As adverted to above, there is an understandable reluctance, in appropriate cases where the language of the relevant contract allows, to depart from the established construction of clauses drawn from standard forms of commercial agreement. AED concerned such a clause, as does the present case. AED is a decision of an intermediate appellate court and, as is clear from the foregoing, I do not consider its conclusion as to the ordinary grammatical reading of the words there considered to be plainly wrong. 8. As to the second possible reason for departing from what I consider to be a natural reading, I do not consider it necessary to enter into the debate as to the reasoning process in AED. As a court of first instance, it would not be appropriate to depart from that appellate decision unless convinced it was plainly wrong. In AED, the Victorian Court of Appeal expressly accepted (in the context of the agreement there in dispute) that "urgent" was to be read distributively. True it is that the reasoning in that case, it has been said, must be read subject to other leading authorities in the area (see JD Heydon, MJ Leeming, PG Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies (5th ed, 2015, LexisNexis) at [19-140] fn 123, 124). However, I do not consider that the concept of "urgent … declaratory relief" is necessarily nonsensical or is otherwise of such a nature as to justify a reconsideration of what I consider to be a natural grammatical reading of the clause. 9. In this regard, I note that Lee J recently reviewed some of the authorities in the area in Dillon v RBS Group (Australia) Pty Limited [2017] FCA 896 at [25]-[30]). After noting (at [25]) two High Court decisions in which there were observations to the effect that interlocutory declarations are not a form of order known to the law, his Honour observed that (at [26]): Away from the context of representative proceedings, the notion that a Court should not make an interim or interlocutory declaration has long been regarded as being fundamental; this is because an interim declaration is inimical to the very nature of declaratory relief, which is to determine, on a final basis, the whole or part of the justiciable controversy between the actors to a dispute … [emphasis in original] 1. After referring to AED and several other relevant authorities, his Honour concluded that the "settled position" is that (at [29]): … although an interlocutory or interim declaration is unavailable in Australia, this does not operate as an insuperable barrier against making a declaration other than at a final hearing in the special case where the declaration determines on a final basis an aspect of the matter in dispute (and hence can properly be seen as a final determination of the whole or part of a legal controversy). [emphasis in original] 1. Perhaps implicit in CPB's submissions is the proposition that the legal background against which the contract was made may be of use to the resolution of the constructional question in this case (as to the use of such background, see K Lewison and D Hughes, The Interpretation of Contracts in Australia at [4.06]). This may be relevant, for example, for the purposes of an argument that the parties should not be taken to have intended by this clause to preserve (albeit obliquely, perhaps) a right to seek "urgent … declaratory relief" in circumstances where such relief, assuming that by this reference what was meant was an interim or interlocutory declaration, is unavailable in Australia. 2. It can be observed that the clause in question does not in terms refer to an "interim" or "interlocutory" declaration. It refers, on my construction, to "urgent … declaratory relief". I do not think it necessarily implausible that parties might include a carve out provision preserving a right to seek "declaratory relief" (in view of its utility, as noted in the authorities to which CPB referred) while nonetheless considering it appropriate, in the circumstances of the arrangement in question, to attach a condition of "urgency". If such a possibility is said to be uncommercial (or simply less desirable in the circumstances as they have transpired), I observe that "there is no licence for 'judicial rewriting' of an agreement'" as "[t]he ability of courts to give commercial agreements a commercial and business-like interpretation is constrained by the language used by the parties" (Newey v Westpac Banking Corporation [2014] NSWCA 319 at [91] (Gleeson JA; Basten and Meagher JJA agreeing). 3. In the present case, as I have noted, the parties have qualified the preservation of a right to seek "injunctive … relief" and "declaratory relief" with a notion of urgency. For the foregoing reasons, I am not persuaded that the clause should be construed other than in accordance with what is, in my opinion, its ordinary grammatical reading. 4. As to the meaning of the word "urgent" in the present phrase (issue 2(c)), I accept that its ordinary meaning is as set out at [105] above and there is nothing in the present agreement to suggest that a different meaning was intended. 3. Are the present circumstances "urgent" CPB submissions 1. As to the urgency of the present circumstances, CPB points to two matters: first, the financial position of the JV (both as to the outstanding amounts owing to third party creditors or sub-contractors and as to the JV's ability to provide the relevant documents to claim progress claims from WestConnex) and, second, the dysfunctional (or "frozen") state of the management of the JV arising from the uncertainty as to which of the two JV parties is correct on the substantive dispute. CPB submits that the critical time for assessment of urgency is early November 2017, when the proceedings were commenced. (RdE submits that urgency must be assessed both when the proceedings were commenced and when they were heard.) Financial position of the JV 1. As to the first, CPB says that the circumstances generating urgency commenced with the cash flow needs in September 2017 that led the Project Director to ask the JV Board to direct that the parties to contribute $8.5m each as a Called Sum and ultimately to the 19 September 2017 meeting being expressly called for that purpose (see the sole matter on the agenda contained in the teleconference invitation). CPB points out that a cash injection was required at that time not only to pay sub-contractors' claims but also to permit the Project Director to sign a statutory declaration in the form of Part 2 of Schedule 5 to the D&C Deed to the effect that all sub-contractors had in fact been paid (which was necessary for JV progress claims to be approved). 2. CPB argues that there was no dispute that, as at September 2017, a cash injection was required and submits that the fact that the parties are "at logger-heads" as to the effect of that meeting alone generates the required level of urgency. 3. The evidence as to the cash flow position of the JV (which was the subject of some dispute) can be summarised as follows. 4. As at 25 October 2017, by reference to a cash flow document prepared by JV personnel (see Mr Hughes' affidavit of 8 November 2017, Annexure B) current outstanding liabilities were in the order of $39.64m and the JV had a bank balance of $1.3m, with projected income of $2m in November 2017 and $3m in December 2017; remaining project revenue being estimated at approximately $5,110,000 (including GST) with remaining costs and liabilities estimated at $56,910,000 (including GST). Mr Hughes gave evidence that the cash flow was prepared in response to the request made at the meeting on 25 August 2017 to identify "necessary and urgent" payments (see [40] above. 5. Mr Simbaqueba had prepared (for the purposes of the litigation but in a form said by Mr Simbaqueba to be typical of spreadsheets prepared by him for the purpose of determining overdue payments to sub-contractors) a schedule of current liabilities as at 31 October 2017 (see Mr Hughes' affidavit of 8 November 2017, Annexure O; Mr Simbaqueba's affidavit of the same date, Annexure E), seeking to identify the current status of the outstanding liabilities to sub-contractors. That schedule (the Simbaqueba Schedule) showed: current liabilities of $46.197m (excluding work in progress), of which overdue amounts totalled $40.295m. Of the overdue amounts, those to third parties (excluding amounts owing to CPB and RdE for their labour or materials) are shown at $14.975m. The Project Account bank balance was $198,096.05. 6. Mr Simbaqueba's evidence was that, in preparing that schedule, he took the due date payable for each invoice in accordance with the relevant sub-contract terms and identified actual due dates for payment. He says the "JDE" accounting system used by the Project Director was not up-to-date in that it did not include all invoices for liabilities. He also gave evidence that the reference to $7,000,000 designated for the period from 16 to 30 October 2017 represented the "bare minimum" to pay subcontractors, not just all overdue amounts. 7. Mr Simbaqueba identified in the Simbaqueba Schedule a number of the payments to subcontractors, suppliers and consultants which were overdue as at 31 October 2017 and which were in his opinion "important", "critical" or "super critical" to completion of the Project (see the coloured shading on the Simbaqueba Schedule). There was a dispute as to the admission of the coloured shading but it was ultimately allowed by me as going to Mr Simbaqueba's opinion or assertion as to the criticality of the sums due. 8. Further, Mr Hughes has deposed that in early November 2017, a number of sub-contractors, suppliers and consultants were threatening action of various kinds against the JV (Mr Hughes' affidavit of 15 November 2017, Annexures P1-P4). 9. CPB points to the JV's Statement of Financial Position as at 31 October 2017 (annexed to the affidavit of Mr Luca Brollo, the former RdE Representative on the JV Board who assisted in establishing the JV's finance systems – Annexure C) which shows outstanding liabilities (excluding "Over Claim" and loans from CPB and RdE) of $47,440,099 (Mr Simbaqueba's affidavit of 30 November 2017 at [9]), and says that is consistent with Mr Simbaqueba's evidence. 10. Mr Simbaqueba has also deposed that, as at 8 November 2017, in addition to the invoices listed in the Simbaqueba Schedule, a number of further invoices had been received and a number of further invoices were expected in the near future, together totalling in the order of $3m (his affidavit of 8 November 2017 at [26]). 11. As at the end October 2017, the forecast Construction Completion date was 30 November 2017 (Mr Hughes' affidavit of 8 November 2017 at [6]). The estimated further cost to complete the project, including Construction Completion and defect rectification, was $12.11m (Mr Simbaqueba's affidavit of 8 November 2017 at [27]). (As adverted to above, by the time of the hearing Construction Completion had not yet been achieved but was thought to be imminent.) Mr Hughes has deposed that, following Construction Completion there will be a three year Defects Correction Period (Mr Hughes' affidavit of 8 November 2017 at [6]), which it is said will require the continued involvement of the subcontractors and suppliers who have been experiencing difficulties in obtaining payment from the JV. 12. Both Mr Simbaqueba and Mr Hughes have deposed to concerns as to the risk of suspension, disruption or other action by various sub-contractors, suppliers or consultants, which could threaten the forecast achievement of Construction Completion (albeit that that is now imminent) and result in the JV incurring further liquidated damages in the amount of $10,000 per day (Mr Simbaqueba's affidavit of 8 November 2017 at [18], [23], [25]; his affidavit of 15 November 2017 at [4]; see also Mr Hughes' affidavit of 8 November 2017 at [24]; his affidavit of 15 November 2017 at [3]-[4] and Annexures P1-P4 thereto). 13. CPB also notes that, by letter dated 10 November 2017, WestConnex, referring to the failure of the JV to provide a supporting statement for its October progress claim, expressed its concern that non-payment of subcontractors might impact on the obligations of the JV under the D&C Deed and sought written assurance as to RdE's solvency (and advised the JV that no payment to the JV would be processed until a signed statement was provided) (Mr Hughes' affidavit of 15 November 2017, Annexure Q). As at the date of the hearing, as I understand it, no response had yet been provided by the JV to that letter from WestConnex. 14. CPB has also submitted that, as a result of the non-payment of subcontractors and the inability of the JV to certify payment, it (as one of the JV partners) was suffering material reputational, relational and commercial damage, and facing the real risk of further such damage, including the risk of a substantial breach of the D&C Deed, which it is said would have potentially very serious consequences (Mr Hughes' affidavit of 8 November 2017 at [25], his affidavit of 15 November 2017 at [6]). 15. It is submitted that, having regard to the needs of the JV, of CPB and of the third party creditors, the urgent need for Called Sums that existed as at 6 October 2017 has not lessened since then, but has only increased (Mr Simbaqueba's affidavit of 8 November 2017 at [28]). CPB notes that RdE has agreed to contribute to only one payment of all the liabilities that were outstanding as at 19 September 2017 or those that are now outstanding (namely its half of a payment made to the Australian Taxation Office on 7 November 2017 in the sum of $2.7m - Mr Simbaqueba's affidavit of 8 November 2017 at [22]). As at 17 November 2017, cash at bank was $206,519.55, as at 7 December 2017 it was $252,676.05. 16. CPB says there is no dispute that an amount of $2,457,666.28 represents retention liabilities held and to be released at substantial completion and construction completion at various periods. It says that what has not been proven in these proceedings (because it cannot be proved at this stage) is when those retentions are due to be released to sub-contractors as a matter of contract and entitlement. It says that there are no cash reserves covering those retentions (the current bank balance of JV showing available cash funds of $252,676.05). 17. CPB argues that an urgent resolution of the impasse is required from the point of view of third party creditors, the JV business itself and CPB. CPB emphasises that the JV was, and is, a single-project venture that cannot rely on revenue from other projects to meet its liabilities and that it is a loss-making project dependent on the JV parties' periodic cash contributions to meet its liabilities (referring to Mr Simbaqueba's affidavit of 8 November 2017 at [2]; Mr Hughes' affidavit of 8 November 2017 at [5). It points out that that there is no other mechanism under the JV Deed to ensure funding of the JV's liabilities. 18. CPB submits that it is unacceptable that the creditors be left unpaid indefinitely while the dispute between the JV partners as to RdE's obligation to contribute is resolved in a non-urgent fashion and that "the project as a whole be thereby held to ransom". CPB emphasises that the payment which CPB seeks is not a payment to CPB or a debt to CPB; rather, it is a debt owing to the JV for the JV's use in executing its obligations including payments to creditors; and any interest on the Called Sum is payable to the JV not to CPB. Uncertainty as to position in relation to the management of the JV 1. As to the second aspect on which it relies for the allegation of urgency, CPB points to the current uncertainty as to the management of the JV, noting that: if the notice of default was validly issued on 12 October 2017 then certain consequences follow in terms of cll 12.4 and 12.5 of the JV Deed; whereas if (as RdE contends) there is no default then CPB is not entitled to exclude RdE from having any representative attend and participate in any meeting of the JV Board. CPB thus argues that, apart from financial urgency, "contractual" emergency arises because the project is in effect, in a hiatus because the JV Board is now dysfunctional until this issue is determined. It says that the management and conduct of the JV remain effectively frozen; and that, having regard to the parties' dispute over RdE's obligation to pay the Called Sum, any JV Board meeting and any discussions can only be held on a without prejudice basis. What was said at the earlier directions hearing before Hammerschlag J 1. Finally, I note that CPB places reliance on what it says was the disclaimer (by RdE through its Counsel), at the interlocutory hearing before Hammerschlag J on 10 November 2017, of any submission that might be made as to the basis of changed urgency between the commencement and hearing of the proceedings: HICKS: Well, your Honour, can I indicate, your Honour, my client is based in Italy. It wishes to have the matter of the urgency in the context of this joint venture agreement dealt with on the evidence. And I would prefer, your Honour, if I could, adduce that evidence which we can serve by next Friday and have the issue of the arbitration agreement. HIS HONOUR: But and you are not going to argue, if I allow you to do that, you can't argue that the urgency has been dissipated by the time you want to take to argue that it is not urgent. HICKS: No, your Honour. We won't take that point. … (T 3.30-40). 1. Pausing there, I do not understand RdE's submissions to be seeking now to resile from the position as conveyed to Hammerschlag J. Rather, as I understand it, RdE's position is that there was not the requisite urgency at the date of commencement of the proceedings and this has remained the case as at the date of the hearing (the lack of "urgency" as at early November 2017 perhaps being suggested to have been borne out by what has or has not happened since in terms of lack of disruption to the Project or the Works). RdE's submissions 1. RdE argues that the circumstances in the present case do not bring the proceedings within the exception under cl 13.6 of the JV Deed as there is no urgency that necessitates CPB seeking injunctive or declaratory relief. It says that the parties' rights and entitlements are prescribed by the JV Deed and that there has been and is no real prejudice to the Project or to CPB in the following circumstances. 2. First, it notes that Construction Completion was programmed (or forecast) to be achieved on 30 November 2017. RdE says that, despite the concerns expressed by the plaintiffs' witnesses, the Project has not been delayed by any alleged lack of funds to pay subcontractors; that subcontractors and consultants have not "walked off the job" and refused to complete the Project that; the parties are not at risk of the JV incurring liquidated damages for delay caused by subcontractors refusing to finish the Project; that the parties do not face legal proceedings from the client for failing to complete the Project; and that the parties do not face reputational damage in the marketplace for failing to complete the Project. 3. In response to this, CPB accepts that the subcontractors have not yet acted so as to cause actual delay to Construction Completion. However, CPB says that it does not follow, and cannot be assumed, that this was because there was or is no urgency in having these proceedings determined. It is submitted that it may reasonably be inferred that a relevant factor in the sub-contractors' forbearance has been the fact that the proceedings are being determined on an urgent basis. It is submitted that that is a powerful reason for creditors to await the outcome of the hearing. 4. Second, it is said by RdE that the JV has continued to function and all subcontractors and other immediate liabilities have been paid as and when it has been necessary, pointing to the fact that, despite this dispute being on foot, the parties made arrangements to provide funds totalling $2.7 million to the JV to pay an "urgent" tax liability owing to the ATO). RdE estimates that the JV had liabilities presently due and owing to third parties totalling approximately $4.2 million as at 31 October 2017 and says that some of those creditors were paid by the JV on about 17 November 2017. 5. In this regard, Mr Brollo (a former RdE Representative and the person responsible for assisting in the setting up of the JDE system for the JV) gave evidence in his affidavit that he disagreed with Mr Simbaqueba's assessment as to the total outstanding liabilities and total overdue outstanding liabilities ([20]), the main reason for his disagreement being that the Simbaqueba Schedule was prepared not on the basis of a schedule prepared for the purpose of the JV. He says that some $23.75m is not presently due and owing (referring to the direction to which I have earlier referred that payment of debts of CPB, RdE and their related entities be postponed) and referring to the JV Aging Report for October (see [25]; [31]). He says that the total liabilities as at 31 October were in the order of $4.2m less amounts due to the JV parties and related entities and less amounts that he says were not owing as at 31 October or were disputed claims. He also refers to the payments approved on 17 November 2017 to third party creditors of $1.25m. 6. In response to this, CPB points out that Mr Simbaqueba was, until 10 November 2017, the JV Commercial Manager directly responsible for managing, among things, cash flow and the administration of payments to consultants, subcontractors and suppliers (Mr Simbaqueba's affidavit of 8 November 2017 at [1]), in which capacity Mr Simbaqueba: prepared spreadsheets of a similar type to the Simbaqueba Schedule on a monthly basis; used them to work out cash flow and payment requirements; and provided them to Messrs Mortoni, Mongili and Brollo (Mr Simbaqueba's 27 November 2017 affidavit at [3]-[4]; see also Mr Simbaqueba's affidavit of 30 November 2017 at [2]-[7]). 7. CPB submits that (leaving aside the "criticality" coloured bands and "commentary"), the Simbaqueba Schedule records invoice information routinely collated and relied upon by Simbaqueba as Commercial Manager, namely: supplier name, invoice date, invoice number, gross amount (incl GST) and due date (see Mr Simbaqueba's first affidavit at [15]-[17] and [19]-[21]). CPB emphasises that it records not only invoices which have been entered into the JDE accounting system used by the JV, but also invoices actually received but not yet entered into the system (Mr Simbaqueba's 27 November 2017 affidavit at [7]) and uses actual dates due, duly differentiating for this purpose between subcontractors, suppliers and consultants' contracts as well as retention sums due for return (at [17], [19], [20]). 8. As to Mr Brollo's reliance upon the Aging Report as at 26 October 2017 (as part of "the official record as between the JV and the JV Parties...of the JV's financial position at any particular given point in time" (at [17]), CPB says that this does not (unlike the Simbaqueba Schedule) take account of: retention sums due for return; invoices that have been received - and even assessed and approved for payment - but have not yet been manually uploaded to the JDE system; or differentiated dates due for subcontractors, suppliers and consultants (Mr Simbaqueba's 27 November 2017 affidavit at [5]; and see at [8]-[9]). CPB argues that Mr Brollo has assumed that, in any case where a dispute has been raised in respect of an invoice, there is a liability of nil (see [30] and [31(d)]), with which Mr Simbaqueba disagrees (see [11]). 9. CPB emphasises that the JV's Statement of Financial Position as at 31 October 2017 (Mr Brollo's 21 November 2017 affidavit, Annexure C), which also forms part of "the official record", corroborates the Simbaqueba Schedule. Thus CPB submits that the Simbaqueba Schedule may be regarded as a reliable record of all outstanding JV liabilities (excluding loans from JV parties) as at 31 October 2017. CPB points to the following evidence of Mr Brollo in cross-examination: Q. And in terms of the payment of packages of invoices, as I understand your evidence Mr Simbaqueba would submit to you packages of invoices for approval by the JV? A. A list of invoices for approval, yes. Q. And they would be reviewed by you, would they? A. Yes. Q. And there have been very few occasions where you have disagreed with Mr Simbaqueba's recommendation for the payment of invoices, haven't there? A. Very few occasions. Q. On the whole there has been agreement about what sub‑contractors need to be paid? A. Yes. Q. And so you would accept, would you not, that Mr Simbaqueba's estimate of what sub‑contractors had to be paid and when has been reliable throughout the course of the project as a whole? A. Yes, correct. 1. CPB submits that in fact subcontractors have not been paid when their payments have been due. It says that a "select few" were paid after CPB contributed its Called Sum in September-October 2017; and that otherwise they are not being paid at all. 2. The third matter RdE raises in disputing the asserted "urgency" is that, on two occasions, it has requested that a JV Board Meeting be held to determine which "critical" subcontractors require immediate payment, for which RdE is willing to make a voluntary contribution of funds to the JV to pay those amounts notwithstanding this dispute, but that CPB has not responded to these requests. RdE also says that the JV is due to receive from the client further revenue of approximately $5.11 million which, once received, will be available to pay the JV's third party creditors, "in addition to the further amounts that [RdE] contributes". 3. As to this, CPB notes that Mr Mortoni's email of 22 November 2017 (Annexure G of his affidavit) refers only to "truly critical payments", not to overdue payments as such. 4. Finally, RdE submits that "the JV has continued to function and amounts have been paid for immediate liabilities (such as to the ATO). CPB, in response, reiterates that the ATO is the only liability to which RdE has contributed since September and that other immediate liabilities are not being met and argues that is a reason for urgency. Determination 1. Leaving aside the subjective nature of Mr Simbaqueba's assessment as to the urgency or criticality of sub-contractor payments, and accepting that parts of his evidence were read subject to weight as to his assertion or belief as to the financial position, what ultimately is not disputed is that there are outstanding claims by sub-contractors and other creditors, that there has been an inability on the part of the Project Director to certify that all sub-contractors have been paid (giving rise to an inability to pursue claims for progress payments); and there has been, since September 2017, an urgent need for cash injection to the JV for cash flow purposes as evident from the communications of the Project Director. That is sufficient to import urgency for the purposes of the relief that is now sought in relation to the resolution to pay the September Called Sum. Therefore, notwithstanding that the Project is nearing Construction Completion I am satisfied that the relief sought by way of an injunction to compel the execution of the Called Sum resolution is urgent. 2. As to the second aspect on which CPB argued that there is urgency, I am less convinced. That is because, while I accept the situation is that the management of the JV at least at JV Board level is currently dysfunctional – due at least in part to the uncertainty as to whether CPB is correct in its assertion that RdE is not currently entitled to participate at Board level – at a practical level that is a result of CPB's refusal to allow RdE to participate in JV Board meetings (in reliance on what it asserts are its legal rights). I consider that this is broadly analogous to the situation where a party seeks to rely on its own breach of contract in order to exercise a right of termination. I accept that at one point CPB was prepared to participate on a without prejudice basis in meetings but it is not clear the extent to which this has been taken up; nor that this has remedied the dysfunctional nature of the JV Board at the present time. In any event, it is not necessary to take this further, since I am persuaded that the first aspect of CPB's argument as to urgency should be accepted. 4. Whether CPB is entitled to final orders of the kind sought 1. The next issue in the agreed statement of issues is as to whether CPB is entitled to final orders for RdE to perform the alleged obligations under the terms of the JV Deed, as sought by paragraphs 4 and/or 5 of the summons, within the scope of the exception under cl 13.6. 2. CPB says that, once proceedings have been commenced, the Court's jurisdiction is engaged and that the Court will, as far as possible, finally determine controversies between the parties (referring to Australian Securities Commission v Ampolex (1995) 38 NSWLR 504 at 108). 3. RdE argues that the final orders as sought in paragraphs 4 and/or 5 of the summons are not within the scope of the exception under cl 13.6. RdE notes that cl 13.6 of the JV Deed only entitles a party to apply to the Court for urgent interlocutory or declaratory relief but that what paragraphs 4 and 5 of the summons seek are orders compelling RdE forthwith to pay the Called Sum, together with interest into the Project Account ([4]) and thereafter to authorise payment of the amounts of the Called Sum and interest out of the Project Account to meet outstanding payment liabilities of the JV ([5]) not limited to third party subcontractors, consultants or suppliers. 4. RdE says that, in substance, what is sought by paragraphs 4 and 5 is the specific performance of its obligations under the JV Deed, not orders seeking injunctive or declaratory relief. RdE argues that, where mandatory orders are sought in the course of enforcing contractual rights (as it says is the case in the present case), such orders although sometimes referred to as "mandatory injunctions", are more properly regarded as part of, or in the nature of, relief by specific performance, or relief approximate to specific performance (referring to Spry, The Principles of Equitable Remedies (9th ed, 2014) at 557; JD Heydon, MJ Leeming and PG Turner, Meagher, Gummow & Lehane's Equity: Doctrines & Remedies (5th ed, 2015) at [20-005]-[20-010]). RdE argues that legal terms of art in a contract are presumed to be used in their strict legal sense unless the context indicates otherwise (referring to Phoenix Commercial Enterprises Ptv Ltd v City of Canada Bay Council [2010] NSWCA 64 at [167]-[172]) and submits that the term "injunctive" in clause 13.6 should be given its strict legal meaning. 5. In that regard, RdE refers to ICF Spry, The Principles of Equitable Remedies (9th ed, 2014) at 557 and says that when an injunction is sought in the Court's auxiliary jurisdiction, as in the present case, the Court may only grant an injunction that: prohibits the other Party from taking particular action that would be in breach of the JV Deed (a "prohibitive injunction "); or requires the other Party to take mandatory action to restore an earlier position (a "restorative injunction"). 6. Therefore, it is submitted that, regardless of whether or not the requisite "urgency" is established, cl 13.6 of the JV Deed does not entitle CPB to apply to this Court for the relief sought in paragraphs 4 and 5 of the summons, being relief in the nature of relief by specific performance. 7. In response, CPB argues, first that an arbitrator's declaration is not a "declaration" according to law but a form of inter partes resolution of an issue or issues, and, second, that a "mandatory injunction" is an "injunction". CPB accepts that a mandatory injunction, as in this case, is in the nature of specific performance. Nevertheless, it says there is a distinct reason in this case for seeking an injunction rather than an order for specific performance namely that a mandatory injunction is more appropriate relief than an order for specific performance of part of a contract, or an in specie term or terms of a contract, whereas specific performance generally seeks to place the parties in the position they would have been had the whole contract been performed (referring to Sydney Consumers' Milk & Ice Co Ltd v Hawkesbury Dairy & Ice Society Ltd (1931) 31 SR (NSW) 458, and in particular the comments of Long Innes J at 466-471). It argues that the fact of a mandatory injunction being in the nature of specific performance does not mean it is not an injunction. CPB submits (and I agree) an order for specific performance and a mandatory injunction in the nature of specific performance are recognised to be different categories of relief to be applied in different circumstances. Determination 1. A mandatory injunction of the kind here sought, though it may be characterised as being in the nature of an order for specific performance (as opposed to specific performance in the strict sense) nevertheless remains a claim for injunctive relief. Therefore, urgency being established, I do not accept that if what is here sought is in the nature of an order for the specific performance of contractual obligations that would take the claim for relief outside the scope of the exception contained in cl 13.6. 2. That said, I am not persuaded that it is appropriate to make the orders sought in paragraphs 4 and 5 of the summons. Order 4 presupposes that RdE will not act in accordance with the resolution if the resolution is executed. There is no basis to assume that will be the case. Rather, RdE has steadfastly maintained that there is no direction to pay the Called Sum as there has been no vote and no signed resolution. Execution of the resolution for a Called Sum will obviously change that state of affairs. It remains to be seen as to whether RdE will perform its contractual obligation to pay the Called Sum once there can be no argument as to the validity of the JV Board resolution to do so but that is a matter for another day (and possibly for another tribunal to consider). As to paragraph 5, that contemplates a situation in the future as to whether authorisation will be given to payment out of sums to sub-contractors or the like. That is a matter to be considered at JV Board or management level on a case by case basis. (I note in this regard that Mr Mortoni has deposed to RdE being fully committed to completing the program as soon as possible and to ensuring all sub-contractors are paid by the JV what is legally … to each of them" (see [10] of his 22 November affidavit). It is not appropriate to make an order in advance in anticipation of some future dispute of this kind. Called Sum Dispute 5. Factual findings in relation to the 19 September 2017 meeting 1. There were very differing accounts as to what occurred at the 19 September 2017 teleconference. They may be summarised as follows. Mr Hughes 1. Prior to the 19 September 2017 JV Board meeting Mr Hughes had prepared notes headed "Background Information" from which it is clear that he was preparing for a discussion as to Called Sums at that meeting. 2. The account of the meeting given by Mr Hughes in his affidavit of 8 November 2017 (at [13]-[14]) is confined to his recollection as to the discussion about Called Sums, commencing with him establishing that there was a quorum followed by his proposal of a resolution, to which he attributes the response (from "Mortoni and Bagnariol", without differentiation between the two) "Yes. However we are not in a position to pay it by 29 September". He says there was a discussion about timing of payments and then, again attributing the words to both "Mortoni and Bagnariol", that they said "We agree to pay it on or before 6 October 2017". He says that he then said "Ok then that's agreed and resolved" and that "nobody present expressed any dissent to this". 3. Those of Mr Hughes' hand-written notes that he says were taken at the time of the teleconference are as follows: Quorum present as : CPB confirmed Michael Hghes +/or Peter Chatburn present for the CPB JV Board. RdE confirmed Aurellio Mortoni [sic] present on behalf of RdE JV Board. CPB's MH started meeting by proposing a single resolution being payment [that word crossed out] resolution for a Called Sum. Resolution agreed. – RdE will be able to pay $8.5m 2-6th October 17. Was Thursday – 21st September. 1 October 17 [crossed out] Simone requested update of today's meeting with JMC. Aurellio provided up date as follows: – LD's limited to $10k/day from 30/6/17 – Construction Completion – Joint Defects treated as an excepted claim. – Schedule 4 will be replaced by a new Settlement Deed to be issued by JMC tomorrow. – $10.9m will be paid once Settlement Deed is executed. END 1. In cross-examination, taken to the order in which the discussions took place at the 19 September meeting, Mr Hughes readily accepted that the initial discussions concerned the meeting that had occurred earlier that day between the representatives of the JV and the client. He agreed that was the first thing that was discussed (after confirmation of a quorum being present). He accepted that it was of great significance, in terms of what the JV parties were to decide, as to whether or not this $10.9m that was sought (from the client) would be paid and said that whether that was paid would dictate the timing and quantum of the Called Sum. 2. As to the discussion of the proposal that a payment of $8.5m was to be sought from each partner by 21 September 2017, he did not recall Mr Bagnariol advising that he was going to be in Australia on 5 and 6 October 2017, nor that Mr Bagnariol that said that RdE was not a bank. He said that the statement by Mr Bagnariol that RdE would not be able to pay any amount in respect of a called sum until 6 October was made after the "resolution" was made. 3. Cross-examined as to who had spoken for RdE during the course of discussions concerning Called Sums, Mr Hughes' evidence was that: A. … I heard Mr Mortoni say yes when that resolution was put and then immediately following that Mr Bagnariol spoke about the timing of the payment. 1. Pressed on the fact that his affidavit attributed responses to both Mr Mortoni and Mr Bagnariol "in chorus", Mr Hughes was adamant that Mr Mortoni had said "Yes" and the Mr Bagnariol had gone on to talk about the timing of the payment. He said: A. … They're distinct voices and yes I recall that there were separate voices when we put it to the resolution. 1. Asked in re-examination how the voices were different, he said: A. I can't describe how they're different. They are different human beings and they have different voices. 1. In the course of cross-examination he said that there had been a discussion as to quorum twice at the meeting, first at the beginning and then at the time of the discussion as to Called Sums "because [he] was concerned that the discussion had got off the single topic of the meeting which was the resolution for a called sum and [he] was formal in getting the conversation back on when we got to this resolution point". (I interpose to note that no other witness gave evidence of there being two separate occasions when the issue of a quorum was raised during the course of the meeting.) 2. Mr Hughes' view was that the draft resolution forwarded after the meeting "was just a piece of paper that documented what the resolution was that had just been made". He said that he said words to the effect "I will paper up a resolution which documents what we've agreed in the meeting" and said that within 10 minutes of that discussion he had sent the resolution. 3. Mr Hughes was cross-examined as to the use of the word "ratify" in the draft resolution. He said that this was a pro forma which had been used in the past not always to document Called Sums and that Called Sums had been paid historically without the use of such a document (referring to the August Called Sums). He said that the intent of the document was to confirm what was resolved in the board meeting; and that use of the word "ratify" was probably in error. Mr Chatburn 1. Mr Chatburn's evidence of the meeting (as deposed to in his 8 November 2017 affidavit at [4]-[6]) records a discussion of Called Sums to similar effect, with Mr Hughes saying: "[w]e need a cash injection of $8.5 million from each party by 21 September. Is that agreed", the response to that being that "Rizzani is unable to do that. However, we could do it by the end of the first week of October", followed by a discussion as to when CPB/RdE could put the money in. He says there was no suggestion that RdE could or would not pay the money in question "only that it needed until 6 October 2017". 2. Mr Chatburn's notes simply record: Need 8.5m from each partner by 2/9 Simon in Aust on 5th and 6th Oct. CPB will put money in by 21/9 say 1/10. RDE " " " " by 6/10. followed by notes as to what appears to be programming for works to be done. 1. However, when Mr Chatburn was in the witness box in chief (before cross-examination commenced) he corrected his affidavit, insofar as he had there attributed the responses from the RdE attendees to the discussion of the Called Sums to "Bagnariol/Mortoni" without distinguishing between the two of them. He said that the words were said by Mr Bagnariol. So he did not attribute anything in relation to the Called Sums discussion to Mr Mortoni. 2. In cross-examination Mr Chatburn accepted that the first thing discussed at the meeting was at to an issue in relation to the Works (the joint repairs and the fact that they were to be excluded from any settlement arrangements being reached with the client); that next there was a discussion as to the approval of the payment of $10.9 million after settlement of the "Schedule 4" issue; and that it was reported to the meeting that there was confirmation from the client of Opening Completion having been achieved; and that liquidated damages of $10,000 a day would be levied from 30 June. 3. He agreed that there was then a discussion about the proposed payment of some Called Sums and that the person who spoke on behalf of RdE in the course of those discussions was Mr Bagnariol. Mr Simbaqueba 1. Mr Simbaqueba's account (as deposed to in his 8 November 2017 affidavit at [7]-[8]) is that the discussion as to Called Sums was in words to the following effect: Hughes: OK now we need to decide on the Called Sums. The Project has proposed the amount of $8.5 million each by 21 September. Mortoni and Bagnariol: We can't pay $8.5 million this month but we will pay it by 6 October. Hughes: CPB can pay by the first business day in October. We may try to pay some money on or before 26 September. Mortoni and Bagnariol: OK Hughes: So we are agreed, RdE will pay $8.5m by 6 October. Mortoni and Bagnariol: Yes …. Hughes: We will prepare a Board resolution paper and get it signed off. and that "Mortoni and Bagnariol" said "Yes, fine". 1. His notes record the following: Called Sums * RdE promise to pay before 6/10 *CPD promise to pay before 1st biz day of Oct - may try to pay some $ 21/9 or 26/9 to be confirmed. *SB/MH to prepare Called Sums resolution for JVB to sign *Need action on [SAS?] 1. In cross-examination, Mr Simbaqueba did not agree that the first issue discussed at the JV Board meeting, after people had introduced themselves as present, was the requirement for the client to have some joint by joint analysis undertaken to attend to perceived defects in construction. Rather, he said that the first part of the meeting was the discussion as to whether or not there would be the release of payment of $10.9 million by the client in settlement of certain claims and issues that had arisen. He also did not accept the proposition that the second topic was the issue of repair of joints and construction issues (as part of the discussion as to the release of some moneys). Rather, he said that this was discussed after the discussion of the Called Sum (which he identified as the second item of discussion). 2. Mr Simbaqueba accepted that he had said in his affidavit of 8 November 2017 that Mr Mortoni and Mr Bagnariol responded on behalf of RdE. He did not distinguish between the two in his affidavit or in his oral evidence. 3. He confirmed that it was his recollection that Mr Hughes stated "We will prepare a board resolution paper and get it signed off". 4. He also confirmed that the $10.9m that was sought from the client by way of additional funds was received by the JV on about 29 September but he did not accept that this "changed the scenario somewhat" in terms of what was required by way of Called Sums. 5. In re-examination he said that the estimate as to the $7m dollars (16‑30 October 2017) on his cash flow document was the amount "that was the bare minimum to pay, not just all the overdue amounts"; i.e., "the bare minimum whilst I guess not paying other people". He accepted that it was common that not all people would be paid as and when they were due, but said that this was because of the cash issue. Mr Bagnariol 1. Mr Bagnariol's recollection is that the meeting was conducted for approximately 20 minutes and that the main issues discussed were the recent negotiations with WestConnex (about 10 minutes) and a "proposal" to direct the payment of Called Sums of $8.5m (another approximately 10 minutes) (affidavit at [10]). In his affidavit, Mr Bagnariol sets out his recollection of the words spoken at the meeting, commencing with Mr Hughes establishing a quorum, followed by the discussions about negotiations with the client and then goes on to depose as follows: 12. There followed a discussion about negotiations with the Client, and then the meeting concluded with a discussion to the following effect: Mr Hughes: What is the earliest date that RdE can put in its money? Me: RdE would not be able to pay until 6 October. RdE is not a bank, and it would take time to transfer funds from Italy. Mr Hughes: So the resolution should say that each party is to pay $8.5 million on or before 6 October? Mr McCormack: Yes. Mr Hughes: Okay. I will paper that up and send around a written resolution so we can formalise it. Is there any other business? Me: No. We will collate the minute of this meeting and the minute of the previous meeting. I will send through the minute of the previous meeting so you can respond with any comments. Mr Hughes: I will. … 14. I did not hear Mr Mortoni say anything during the September Board Meeting about whether he either consented to or opposed RdE paying a Called Sum of $8.5 million on or before 6 October 2017. Given his silence, and the fact that Mr Hughes indicated that a written resolution in respect of the Called Sum would be circulated, I believed that there was no resolution for any Called Sum made by the JV Board during the September Board Meeting, but that the proposal would be the subject of a written resolution by the JV Board to be circulated after the meeting and signed by the Representatives of each party. 15. I have read the affidavits of Messrs Simbaqueba, Hughes and Chatburn about the September Board Meeting, and say as follows: (a) as to the version given by Mr Simbaqueba in paragraphs 7 to 8 of his affidavit dated 8 November 2017: (i) Mr Mortoni did not speak during the meeting as asserted by Mr Simbaqueba; (ii) I agree that Mr Hughes said words to the effect of 'We will prepare a Board resolution paper and get it signed off'; and (iii) I otherwise refer to paragraphs 12 to 14 above; (b) as to the version given by Mr Hughes in paragraphs 13 to 14 of his affidavit dated 8 November 2017: (i) Mr Mortoni did not speak during the meeting as asserted by Mr Hughes; (ii) I deny that Mr Hughes said words to the effect of "I am proposing a resolution that each party pay the Called Sum of $8.5 million as indicated in the cash flow. Is that resolution agreed" or that either Mr Mortoni or I said "Yes" in reply to such a statement; (iii) I deny that Mr Hughes said words to the effect of "OK then that's agreed and resolved"; and (iv) I otherwise refer to paragraphs 12 to 14 above; (c) as to the version given by Mr Chatburn in paragraphs 5 to 6 of his affidavit dated 8 November 2017,I refer to paragraphs 12 to 14 above. 1. As to the evidence by Mr Mortoni (to which I refer below) to the effect that Mr Mortoni was absent during part of the September Board meeting, Mr Bagnariol's recollection is that: 16. During the September Board Meeting, I noticed that Mr Mortoni did not take part at all in the discussion regarding the proposed Called Sums. After the meeting, I telephoned Mr Mortoni and we had a conversation to the following effect Me: Why did I have to do all the talking during that meeting? Mr Mortoni: Sorry, I had to take part in another telephone call about the Perth project, so I left the room for a few minutes to deal with that. 1. In cross-examination, Mr Bagnariol accepted that he had been General Counsel of the RdE group for about 8 or 9 years. He accepted that he was a person who took great care in the way in which he communicated with others particularly in a commercial context; took care in the way in which he communicated with others both in writing and in oral conversations; and took great care in reading documents he received relevant to the business before him. He accepted that in the major part of cases before he attended those meetings he acquainted himself with the subject matter which was proposed to be discussed at those meetings and that he acquainted himself with the facts which were to be discussed at that meeting. 2. Mr Bagnariol said he commenced to inform himself about the financial position of the Project some months prior to September 2017. He accepted that the subject of the Called Sums at September 2017 was critical to preserve the cashflow of the joint venture. 3. As to the meeting of 19 September, he said he did not recall when it was put to him that, following the discussion about the meeting with the principal that morning, Mr Hughes had said that he wanted to propose payment of the Called Sum of $8.5m. He said that he knew (from seeing the meeting invitation) that there was a request for additional funds and said that he knew there was a discussion related to a possible called sum. 4. He emphasised that in his role: A. … I receive 200 emails per day. I am copied to all projects we have all around the world so‑‑ 1. He did not remember whether he had had a discussion with Mr Mortoni prior to 19 September 2017 concerning the proposal to pay a called sum of $8.5m. He said that he was aware that there was a cashflow problem "and one of the discussions during the meeting was a possible request of additional funds from the partners" but he could not presently recall the amount of that contribution. He did not recall that Mr Hughes said during the course of that meeting, I want to propose the payment of $8.5m as a called sum", or words to that effect. Asked whether Mr Hughes might have said it but he just could not recall it, Mr Bagnariol said: A. Honestly I don't know. My understanding was that he would have circulated a resolution asking 8.5 million. This is my recall. 1. His evidence was that he did not hear Mr Hughes make such a proposal: A. … When I left the meeting I was of the impression that we agreed that he would have issued a document to be signed. This is what was my impression after that meeting, but it was over the phone. I admit that it was over the phone and I am not a native English so‑‑ 1. Mr Bagnariol did not accept that his impression that a resolution would be sent after the meeting (for the payment of a Called Sum) was because there was discussion and agreement at that meeting for the payment of a called sum of $8.5 million. Q. What would have been the point of the resolution? A. Because I am not authorised to take any commitment for my company to pay $10 million, so my recollection is that he would have issued the resolution, the document and I would have obtained the approval from someone else of my company. This is my recollection. 1. He said that such a resolution would have been taken up with Mr Alzetta. 2. As to the position of Mr Mortoni: Q. You say that having noticed that during the board meeting Mr Mortoni did not take part at all, after the meeting you telephoned him and you said, "We had a conversation to the following effect", and you refer to a conversation. You see that there? A. Yes. I was really upset. Q. I am sorry? A. I was really upset. Q. Because you didn't recall him saying anything? A. No, because during that meeting we discuss important issues like the cost to complete and we were again very upset about the increase, the further increase even when the project was completed and I was alone discussing increase in one month, even after they deliver the project. Q. At the moment I am asking you about the subject matter of the called sum? A. Sorry. … Q. And in your affidavit you immediately telephoned Mr Mortoni after the meeting and the only question you asked of him, you said to him, "Why did I have to do all the talking during this meeting?"? A. With Mr Mortoni, yes. Q. Yes, and he said, "Sorry, I had to take part in another telephone call"? A. Yes. Q. You say nothing and you didn't at that time discuss with him the subject of the called sum? A. I was really upset and I (witness indicated) left down the phone and I went to talk with our Managing Director, Franco Alzetta. Q. Right. How soon after the board meeting did you telephone Mr Mortoni? A. Immediately. Q. Immediately? A. Yeah. Q. What, within a minute or two? A. Yes. Q. Is that right? A. I would say two minutes. Q. And are you saying to us that although you telephoned Mr Mortoni very shortly after this meeting, within a couple of minutes, you didn't even raise with him the subject of the called sum? A. I don't remember. I mean, as I told you, I was really upset. It was just a quick call saying when and where and that's it, but I cannot say, honestly I cannot say that we didn't speak about the proposal of CPB. Q. Do you recall ever discussing with Mr Mortoni a proposed resolution for the payment of the $8.5 million after 19 September? A. Yes, we discussed. I don't remember when and how many days after because I went, I remember that I went to talk with Mr Franco Alzetta. Q. Yes, when did you go to talk with him? A. I don't remember if I call him or if I waited the day after, I don't remember, but in a couple of days. Q. Right. What did you say to him? A. That they are requesting again other 8.5 million after the 6.5 million that we have just paid. 1. Taken to the draft resolution, sent by Mr Hughes, Mr Bagnariol recalled receiving that document. He accepted that at the time he read it he understood that Mr Hughes was asking Mr Mortoni to sign the resolution attached to the documents. He did not accept this document to indicate that Mr Hughes was saying that there was a decision made on 19 September to pay $8.5m. He said that he understood the word "documenting" in that email to mean: A. That he was requesting the authorisation and the agreement of Rizzani de Eccher to pay the 8.5 million. not to suggest that what Mr Hughes was saying was that he wanted the resolution signed as a record of what had been agreed that day on 19 September. A. I mean honestly, now that you are telling to me that "documenting" means a sort of certification of, I can imagine, but no, I was not aware of that 1. Nevertheless, he agreed that, reading it carefully, the resolution as written was seeking to reflect a decision made by the board on 19 September 2017 to pay the amount of $8.5m on 6 October 2017 and that this must have occurred to him at the time. He did not however remember if it had occurred to him at the time that Mr Hughes was proceeding on the basis that a decision had been made to pay $8.5m by each partner: A. Honestly I don't remember because if you see the timing of the emails, the meeting was finished after two minutes, 10 minutes and Mr Hughes sends this email. Q. Yes? A. And then I said, yes, wait a second, that I need to check, because, I mean, to pay 8.5 million, it is a huge effort for our company, so I was a bit surprised when I have seen the email and I have seen the attached resolution, I didn't pay so much attention on what it was written inside. I have seen only 8.5 million then by the 6th of October and 5 minutes before I was telling to Michael Hughes that RdE is not a bank … Q. You said that you needed to check something. You received the resolution? A. Yeah. I was meaning to the reply that I told you. Q. Yes? A. I have no authority to authorise a payment, so, of course, I need to check. Q. You need to check? A. Yes. Q. Was a matter very important to the joint venture at that time; correct? A. It was important I believe since July August 2016 when we discovered the losses. Q. It was important from then on until at least the 19th, in fact up until now? A. Yeah Q. Correct? A. Yeah. I remember that every time people was asking money, money, to inject money to the project. Q. So, therefore, you exercised extra care in communications you were issuing concerning the subject matter of called sums? A. I did not exercise any extra care. Q. Well, you were very careful? A. Sorry? Q. You were very careful in your communications to members of CPB and anyone else within the RdE organisation about the subject matter of called sums? A. I believe that myself and Mike Hughes exchanged hundreds of emails discussing about the called sums, so if you are asking me that every time that we discuss a called sum I exercise an extra care, I can tell you no. Q. All right? A. If you ‑ sometimes when there was a problem I exercise an extra care, yes. Q. Yes. I want to suggest to you that this was an occasion where you were careful in the response you put together to Mr Hughes in your email of the 19th of September 2017; correct? A. Can you repeat the question, sorry. Q. You were careful in composing the email of the 19th of September 20167 before you sent it? A. The email? Q. Yes, page 537 please? A. No. I have seen the email and I immediately replied. Q. Right. When you said yes in the email you said yes to the request that the resolution be signed, didn't you? A. No. I said, Yes, we will do it, we will take into consideration your request and we will do it Q. You said nothing about checking with anyone else within the RdE Group? A. Correct. Q. Before signing the resolution? A. Correct. Q. You said nothing about having a person with appropriate authority such as Mr Mortoni sign the resolution? A. If I said nothing? Q. Your email mentions nothing about that checking process? A. Correct. Q. And you go on to say "Along with the minute of the meeting". Along with the minute of the meeting". See that? A. Correct. Q. Why was it important to have a minute of the meeting? A. Because again during that meeting I ask to Patrick McCormack to confirm that the cost at completion was a certain number. Q. Yes. It was also important to have a minute of the meeting recording the decision made to pay a called sum of $8.5 million, wasn't it? A. I remember that I was concentrating on the, the final number on the cost at completion. That was my target when I draw the email saying it is very important that we commit on that number. … Q. ... I want to put to you that Mr Hughes, on the 19 September‑‑ A. Yes. Q. ‑ board meeting said words to the effect, about the subject of the called sum, "We have a quorum. I am proposing a resolution that each party pay the called sum of 8.5 million as indicated in the cashflow. Is that resolution agreed"? A. Not at all. Q. It is a fact, isn't it, that Mr Mortoni said yes? A. Not at all. … Q. You just can't recall whether that exchange took place, can you? A. No, I remember. I remember because I was really upset with Mr Mortoni because he was not present. So I can recall that he didn't say anything. 1. As to the email from Mr McCormack saying that CPB had paid in an amount of $1.5 million for the agreed called sum, he said: A. Honestly, I don't remember to have read this email. As I told you, I receive 200 emails per day and sometimes I go through the emails over the night because I said to you, I don't recall reading. Q. Do you recall receiving this email? A. No. Q. You don't even recall receiving it? A. No. 1. He also had no recollection of the email from Mr Mortoni to Mr Hughes as to the delay in payment. (Similarly he did not recall having asked to prepare the August Board minute.) Mr Mortoni 1. Mr Mortoni, in his affidavit of 22 November 2017, deposes that: 13. I was present only at the beginning of the September Board Meeting when the Project Director was informing the JV Board about the status of the Project. Part of the way through the meeting, I was required to attend to a couple of urgent issues not related to the Project. At some point, towards the beginning of the meeting I left the room where I was participating in the teleconference for the September Board Meeting so that I could take part in the other discussion without disturbing the meeting. I did not announce to the other attendees that I was leaving and I did not announce when I returned. I returned very close to the time at which the meeting ended, perhaps one or two minutes before the end of the meeting. I may have been absent from the September Board Meeting for around 15 minutes. 14. For the parts of the September Board Meeting that I was present, I do not recall the precise discussion during the meeting. However, I recall in broad terms the following: (a) I provided an update on ongoing negotiations with the Client; (b) I do not have any recollection of Called Sums being discussed while I was present. If there was any discussion about Called Sums, I assume that it occurred while I was out of the room taking part in another discussion not related to the Project; (c) I did not make any comments in relation to Called Sums during the meeting; and (d) I did not take part in any vote, cast any vote or agree to any resolution at the meeting in relation to Called Sums. 15. Soon after the September Board Meeting concluded I received a telephone call from Mr Bagnariol. I cannot recall the precise discussion during this call, but it was to the following effect: Mr Bagnariol: Why did you not take part in the discussion? Me: I had to take part in another conversation and I was busy working on some urgent matters, so I left the room for most of the meeting. 16. I have read the evidence given by each of Messrs Simbaqueba, Hughes and Chatburn about the September Board Meeting. Having reviewed that evidence, I cannot recall being present during those discussions. Therefore, if those discussions took place, I believe it must have been when I had left the meeting to take part in another conversation relating to a different project, as described above. 1. In cross-examination, Mr Mortoni accepted (at T 111) that when he was appointed Representative on the JV Board in July 2017 he knew that appointment came with certain responsibilities; that when he participated in meetings of the JV Board he would, from time to time, be required to make decisions which were important for the management of the Project; and that prior to each meeting he attended as Representative of the JV Board he prepared himself for the purpose of participating in those meetings. He agreed that whenever an agenda was sent to him prior to a meeting or other communications about what was to be discussed, he would give some thought to that subject matter prior to participating in the meeting. 2. He did not "specifically" recall (T 115) that prior to the meeting of 19 September 2017 he had received communications from the Project Director requiring the joint venture partners to make cash contributions in the form of called sums; but accepted that when taken to the relevant document. Nevertheless, he agreed that, prior to the meeting of 19 September, he knew that Mr McCormack was proposing that the joint venture partners contribute $8.5m as a Called Sum. 3. Mr Mortoni was asked: Q. Did you have any discussions with Mr Bagnariol, Simone, prior to the meeting of 19 September 2017 concerning that request? A. Not specifically. What we was concentrate was more in the, this cash, about 10.9, because I had meeting just before the morning before the meeting. So, the more effort was concentrated on that, and the other was just an idea to analysis visitor, what was the outcome from the first meeting. … Q. What I'm asking you, did you discuss that subject, that is, the called sum, with Mr Bagnariol prior to the meeting? A. Discuss in which sense? What we discuss, Bagnariol, was about the 10.9 million with the client, and a general discussion, but not specifically for the 8 point, what it was? 8.5 million. Q. But when you went into the meeting you knew that the called sum would be discussed at the meeting, correct? A. Correct, but I was more interested was about to give the summary, what was the outcome from the first meeting, because we were concentrated more on the topic of the 10.9 million. 1. He accepted that he knew that the meeting was to discuss payment of the $8.5m called sum and that, prior to connecting to that teleconference, he gave some thought to that subject. 2. Mr Mortoni's evidence was that he attended the telephone conference in his office in North Sydney; that he was on his own during the course of the telephone conference; that that he was in the office and did not shut the door behind him while the telephone conference was on because "There was nothing of confidence". 3. He said that he did not hear Mr Hughes, at the beginning of the meeting, after people had announced their names, saying that "we have a quorum". There was the following exchange: Q. What were the first words you heard at the meeting? A. The first word I heard in the meeting was my name, because the operator say, "Tell your name," and I say my name and after that I remember we start to say "hello" and "Are you on line? Yes, I am on line." When I heard was people on line, I say ‑ I make a brief summary because in the meeting in the morning I was the only one attended and the client. Because I was the only one, I explain what was the outcome from the first meeting and I start to explain how much was important that everyone put, in order to complete the settlement, in order to have this meeting, because this is the more important thing we have at the moment. Q. You are saying it was you who spoke first during the course of the meeting? A. Yes, I was the one, yes. I make the summary of the meeting also, because I was the only one in the meeting in the morning. Q. You mean you were the only one who attended the meeting in the morning? A. Yes. Q. And you were reporting to the JV board the outcome of those discussions, because whether the principal was going to pay $10.9 million had an effect on the amount of the called sum the joint venture partners were being asked to pay? A. Yes, sir, but not only, because this was the main topic. 1. As to the circumstances in which he came to leave the room during the course of the telephone conference, Mr Mortoni said: Q. In the second sentence you say, "Part of the way through the meeting I was required to attend to a couple of urgent issues not related to the project"? A. Yes. Q. And you say that at some point towards the beginning of the meeting you left the room? A. Yes, true. Q. Tell me this; did somebody come in to call you to go outside to discuss something urgent? A. Yes. 1. Mr Mortoni said that a "Marco Petacco" had waved to him to signal him to come out of the office and that it was something urgent and Mr Petacco had said that there was a phone call and a "Robert D'Agastono" was on the line in a meeting with a client: and he need some urgent decision from me, because I have combination of two meeting in parallel, so I cannot attend both. So I need to move and stay with him for 5, 10 minutes. 1. Mr Mortoni said that he left the room for about "15 minutes ‑ quarter of an hour. I can not precisely know, but I can't remember, but about 15 minutes". 2. Mr Mortoni identified Mr Marco Petacco's position as that of commercial manager and says that he is still employed as RdE's commercial manager; he said that Mr D'Agostino is a contractor administrator on the Perth project and still currently employed with RdE. 3. Mr Mortoni said this of what he heard when he returned to the JV Board meeting: Q. What did you hear when you returned to the meeting? A. Almost everyone say "hello, is finished the meeting," and so on and when you say, "Hi/Bye," and after a few seconds I receive phone call‑‑ Q. Just a moment. I want to stick to what you heard when you walked back into the room? A. Just to say "Okay, good bye, we have finished." Q. "We have finished"? A. Yes. Q. When you heard those words, you knew then you had missed something which was discussed during the course of the meeting? A. Of course, yes. Q. And what you then knew you might have missed was a discussion about the called sum? A. Yes, probably and also something more. Q. And the called sum at that time was important to the cash flow of the joint venture? A. Yes. Q. Didn't you think it was important to telephone Michael Hughes, another board representative, to say to him that you had to leave the meeting and did not participate in any discussion about the called sum? A. I thought it was not so important at the time, because at this meeting the important thing was the urgency consideration by both parties to put down the settlement agreement for the $10.9 million, because this was the more the hot topic discussion. In fact when they left ‑ they were discussing about the wording and how to put down with the client about the $10.9 million, something that the lawyers from both side ‑ I don't think it was so important. Q. Just pause. I asked you; didn't you think it was important to you, after you returned to the meeting and realised you didn't participate in a discussion about the called sum, to telephone Michael Hughes to say to him that you missed that part of the discussion? A. I thought not. Q. Notwithstanding the fact that the actual telephone conference invitation specifically referred to, as a single item on the agenda, the called sum? A. Yes, to be honest I thought it was not so important to call him, because normally this kind of decision was always taken by our top management. was always my managing director and the Martin Wood that decide this kind of thing. I thought it was not important, because he knew even if I had theoretically the power, it is always decided by our manager. I didn't think it was so important‑‑ Q. I am not asking you that, but what you thought? A. I was telling you what I thought. What I thought; it was not so important because myself and Michael Hughes knows this kind of decision was always treated by the top management. So I didn't know it was important to make a phone call. 1. Mr Mortoni's evidence thus was that although he knew that the subject of a called sum was going to be discussed at that meeting, and that he was the RDE Representative at the JV Board meeting, he did not think it was so important to telephone Mr Hughes to inform him that he (Mr Mortoni) might have missed some discussion about the Called Sum. He denied that he had heard Mr Hughes propose payment of a Called Sum of $8.5m. It was put to him that he had said "yes" to that proposal, a proposition that he found confusing (and did not ultimately answer in terms). He was nevertheless adamant that he had not heard the proposal. 2. As to what followed the meeting, Mr Mortoni said that he received a telephone call from Mr Bagnariol. The first account he gave of that conversation in cross-examination was as follows: Q. What did he say to you? A. It was a little bit angry with me, "Why are you not attending the full meeting?" Q. Pause ‑ sorry, continue? A. I don't understand your comment. Q. Just go on? What do you recall him saying to you? A. He saying to me, "Why are you not attending the full meeting? You don't say anything during the central part of the meeting," and I said, "Sorry, I need to attend another urgent matter," and I explain to him, and that's it. 1. Later, when I sought to clarify that response, Mr Mortoni expressed himself in slightly different terms, saying that Mr Bagnariol said "Why you don't say anything during the meeting?" and "Why do you stay outside for all this part". 2. The cross-examination continued: Q. Is that the best you can do about what Mr Bagnariol said to you during that telephone conversation? A. Yes. Q. But you did participate during the meeting, because you have given us evidence that you reported to the JB [sic] board meeting about your discussion with the client that morning? A. Yes. Q. Why would Mr Bagnariol complain to you that you didn't participate in the meeting? A. I don't know, because he was so angry that he say that, probably because he is feeling I left the meeting without informing him I was leaving. I said, "Just because I don't want to disturb anybody and you were discussing legal matter about the $10.9 million and I left the meeting for you to decide." …. Q. … You told us that Mr Bagnariol criticised you for not participating in a meeting? A. No, he said, "You not participate for the majority of the parts of the meeting." Q. So he said, "For the majority of the parts of the meeting"? A. Because he said, "You was in the beginning but in the centre part of the meeting you were missing, because you don't say anything." Q. Did he say anything to you about a discussion which was had during the meeting about a called sum? A. No. Q. Did he say to you that CPB were proposing a called sum payment of $8.5 million? A. At that telephone call, no. Q. Did you ask him about whether there was discussion about that? A. No, because he was angry and he put down the telephone. 1. Questioned about the resolution that was forwarded, Mr Mortoni said that he received the email after his telephone conversation with Mr Bagnariol. His evidence as to what he understood by the email was that: A. I understand that Mr Hughes is proposing to me, as a proposal, this kind of resolution and if I agree, I suppose to sending to him, signed. Q. You saw this email as a proposal? A. Yes. Q. I put it to you that you understood the word "documenting" to mean; recording the resolution made today? A. How can they do the resolution if I don't agree? I think it was just a proposal; exactly Q. What I am putting to you is that when you read this email, you understood Mr Hughes was asking you to sign the resolution recording the decision made that day, correct? A. I don't intend that way, because he‑‑ Q. You did not read it that way? A. Would you please sign, attach and return the document for the resolution today. I mean, if I disagree, I disagree and I don't sign. Otherwise why they ask me to sign? 1. Mr Mortoni did not accept that when he read the email he knew Mr Hughes was proceeding on the basis that a decision had been made on 19 September to pay a called sum of $8.5 million. He said: A. No, my understanding is different, because there was a meeting where he requested 8.5. After the meeting he send the proposal for 8.5 and if I disagree, I sign the proposal. … A. No, what I understands it was a proposal made on 19th, because without my signature is not a resolution. If I sign it, it is I agree and it become a resolution, because I never agree verbally. I never sign it. So, how can it become a resolution? 1. Taken to Mr Bagnariol's email in response, Mr Mortoni said he understood it to be: A. No, what I understand of Mr Bagnariol is, yes, we will process your offer and see if we can do it within two day. Q. "Yes, we will process your offer and see" ‑ what? A. With the minutes of meeting because he said here "along with the minutes of meeting". Q. Your answer was, "Yes, we will process the offer", is that what you said? A. Yes. Q. How did you expect that offer would be processed? A. I expected that we will verify with ‑ because for every decision I need to take, like I said before, I need to ask the approval of my boss, that is Mr Franco Alzetta, like normally as we did with marking vote so he said, "Yes, we will check" because he said, "Can you sign?" "Yes, we will check, you know, to see your proposal and the minutes of meeting". Q. That is how you read it, is it? A. Yes. Q. I want to suggest to you that when you received this email, you understood Mr Bagnariol to be agreeing that you would sign the resolution? A. How he can say that if‑‑ Q. By the word "yes", Mr Mortoni, because that's what the email says? A. May say, "Yes, we will process this thing", sir. 1. As to the email from CPB seeking confirmation of the date when RdE would pay its called sum (after CPB had paid in at least $1.5 million of it), Mr Mortoni said: A. What I was thinking when I received that or interpreted that CPB was trying to promoting ‑ it says, you know, to ask to decide and agree on 8.5 million ‑ if you see, we already start to do that so if you do the same, just to encourage us to take the decision. Q. Just an encouragement, but this says‑‑ A. Otherwise, why they don't put 8.5 if it wasn't 8.5, only 1.5. Q. This point says, "CPB has paid 1.5 million of the agreed called sum". That wasn't an encouragement. You understood‑‑ A. You said before that we supposed to agree 8.5, now you said 1.5. I am confused. I not understand your logic. 1. Then, as to his own email in which reference was made to a couple of days delay in cash contribution (without any suggestion that there had not been an agreement reached to pay the Called Sum), Mr Mortoni said: A. What I meant it was we have a couple of days in the ‑ in cash contribution compared to what they did because they already put their 8.5 so I said I am confident that I can discuss with my boss and convince and say, look, our partner has already contributed, can we agree in contributing. This is what I understand. Q. You say "we have a couple of days delayed cash contribution"" is referring to your equal contribution of the $8.5 million, that is how you‑‑ A. I don't understand sorry, can you repeat? Q. Mr Mortoni, you are expressing confidence that you will pay $8.5 million in a few days, that's the ordinary reading of that email? A. Not ‑ I already said I was confident that I can agree, sign the document and pay it, yes. Q. What was it that gave you that level of confidence? A. Give me the confidence that CPB is already starting to contributing, so it give me the confident that also my management in Italy, he can agree and I can get this agreement. But unfortunately, the day after they put us in dispute so is go out of my hand. Q. All right. Mr Mortoni, let me ask you this: Prior to 9 October was there any process initiated within RDE to approve payment of $8.5 million as a called sum? A. Yes, sir. There was in which sense was because, if I recall very well ‑ it was Friday, I think 6 October no, so during the weekend I says, "Look, they are starting to contributing" and so on, "What we do?" And he says, "Okay, we will done ‑ we will let you know in the meantime, tell to them that we are confident that in two days we may agree to ‑ to carry on with"‑‑ Q. Who did you have that conversation with? A. I have with Simone during the weekend. Q. Simone, I see. And that was it? A. Yeah. Was it. Q. You know Simone doesn't have authority to agree to the payment of the called sum of $8.5 million, don't you? A. But Simone was very close ‑ their office is like 5 metres each other, I know they talk at least ten times a day. If I talk to Simone is like talk to ‑ they discuss each other, no. Mr McCormack 1. The other participant at the 19 September 2017 meeting was Mr McCormack. He gave no evidence in the proceedings. RdE submits that an adverse Jones v Dunkel (1959) 101 CLR 258 inference arises from the fact that CPB did not call evidence from Mr McCormack. 2. CPB maintains that it was not necessary for it to call Mr McCormack; the "rule" in Jones v Dunkel not operating to require a party to give merely cumulative evidence (see JD Heydon, Cross on Evidence (8th ed, 2010) at p 43). CPB says it called its Representatives at the meeting, and Mr Simbaequba, and that was sufficient on the factual issue as to who said what to whom. It notes also that RdE did not call either Marco Petacco or Robert D'Agastoni, whose evidence would have been directly relevant to whether Mr Mortoni was in fact interrupted during the course of the JV meeting and if so, for how long. 3. I will come back to this issue in relation to the RdE potential witnesses in due course. However, in relation to Mr McCormack, I consider that there is force in the submission that an adverse inference may be drawn from the fact that he was not called to give his own account of the critical meeting. It was not suggested by CPB that Mr McCormack should not be treated as being in its "camp", so to speak. Though not a Representative of CPB on the JV Board, Mr McCormack was appointed as Project Director by CPB and there is no suggestion that he was unavailable to give evidence. At least by the time that RdE's affidavits had been filed it should have been apparent to CPB that the issue as to what was said by whom at the critical meeting on 19 September 2017 was, as I have earlier said, hotly in dispute. 4. In circumstances where the CPB witnesses were (at least on their affidavit evidence) unclear as to who, as between Mr Mortoni and Mr Bagnariol, said "yes" to the proposal for a Called Sum (it being CPB's case that at least one of them did), I do not accept that this is a case where to call Mr McCormack would simply have been calling cumulative evidence on the same topic. Rather, he might reasonably be expected to be able to assist in clarifying the uncertainty in the other witnesses' evidence on this issue. Moreover, as Project Director, it might be expected that he could have given evidence as to the formalities (or otherwise) addressed in the discussion (i.e., as to whether the proposal was expressly put as a resolution). As made clear in Cross on Evidence, the rule in Jones v Dunkel "does not compel time to be wasted by calling unnecessary witnesses" but this is said to be particularly so where no challenge is made to the evidence of those who are called. Here, it was clear that there was a challenge to the evidence of those attending the meeting on CPB's behalf. The evidence of Mr McCormack must be accepted as being evidence that would potentially have elucidated a contentious factual issue in the proceedings (see Cubillo v Commonwealth; Gunner v Commonwealth [2000] FCA 1084 at [360]; O'Loughlin J). 5. Therefore, to the extent that there are competing versions of what transpired at the JV Board meeting, the fact that Mr McCormack was not called to give evidence of the meeting would enable me more comfortably to accept the evidence of Mr Bagnariol to the effect that there was not an express vote called for the making of a resolution in relation to the Called Sum. (That does not, however, affect the conclusion I have reached that there was assent expressed in some form at the meeting as to the payment of a Called Sum in the amount of $8.5m.) Assessment of the witnesses 1. Not surprisingly, I was urged by each side to accept that I should accept the witnesses' evidence as to what had in fact occurred at the meeting that supports the contentions made as to the agreement reached or not reached at the meeting. CPB submissions 1. CPB submits that I should accept the account of events of the meeting contained in the affidavits of Messrs Hughes, Chatburn and Simbaqueba and should find that the expression of consensus by the parties' Representatives for the payment of a Called Sum constituted a "vote" resulting in a decision satisfying the requirements of cl 5.4(a) of the JV Deed. CPB also submits that the Court should accept that Mr Hughes proposed that the joint venture partners each pay an amount of $8.5m into the Project Account by 6 October 2017 and that Mr Mortoni said "yes" to that proposal indicating consensus by equal unanimous vote. It argues that the documents issued by Mr Mortoni and Mr Bagnariol following the meeting can only be explained by a decision having been made on 19 September 2017. 2. Insofar as Mr Chatburn, in cross examination, corrected his affidavit stating that it was Mr Bagnariol and not Mr Mortoni who had responded to the request by Mr Hughes for a cash injection of $8,500,000 by 21 September 2017, CPB notes that he nevertheless confirmed that Mr Hughes had sought agreement for the payment of a cash injection of $8,500,000 by 21 September 2017. CPB argues that Mr Chatburn's recollection is likely to have been deficient since shows he could not recall a number of circumstances and emails put to him. 3. CPB argues that Mr Bagnariol is an unreliable witness because: He could not recall significant events. When pressed on certain issues, his recollection failed him. When pressed on what he understood to be the effect of documents expressed in unambiguous language, he suggested that because of the number of emails received by him relating to multiple projects, he might have not exercised the required level of care to understand them properly. That and other explanations he offered in evidence should be rejected. 1. CPB argues that Mr Bagnariol's evidence that he was left with an "impression" that Mr Hughes would issue a resolution to be signed. CPB argues that this evidence is inconsistent with evidence given by Mr Bagnariol concerning his understanding of the resolution circulated by Hughes on 19 September 2017 (namely that he understood the resolution as reflecting a decision by the Board having been made on 19 September 2017 to pay the Called Sum by 6 October 2017). 2. As to Mr Bagnariol's evidence of having been surprised that the resolution proposed that $8,500,000 be payable by 6 October 2017, CPB notes that this is inconsistent with what Mr Bagnariol claimed was agreed at the meeting as a matter of "impression" and is inconsistent with Mr Bagnariol's conduct immediately following and subsequent to the JV Board Meeting (i.e. that within a few minutes of the JV Board Meeting concluding, he wrote an email to Hughes stating the resolution would be signed and that he would prepare a minute of the meeting, without any qualification or reservation). 3. CPB argues that no cogent explanation has been provided for why the email to Mr Hughes was sent a few minutes after the meeting. It says that the only possible explanation for the sending of that email is that a decision was reached at the meeting. The characterisation of what took place by RdE is entirely inconsistent with the sending of that email. 4. CPB says that the process by which the decision was made on 19 September 2017 was entirely consistent with, and flowed naturally from, a similar decision made just under one month earlier on 25 August 2017 when consensus was reached by the discussion at JV Board Meeting to pay a Called Sum of $6.5m following which a resolution was prepared by CPB at the request of Mr Bagnariol. CPB notes that the resolution prepared following that meeting was implemented notwithstanding that it had not been signed by Representatives of the JV Board. RdE submissions 1. RdE, on the other hand, submits that where there is a dispute between the CPB witnesses and RdE's witnesses as to the events during the JV Board meeting on 19 September 2017, the Court should prefer RdE's witnesses, in particular Mr Bagnariol's evidence as to what was said during the meeting. 2. RdE submits that Mr Bagnariol was a candid and honest witness; that he answered questions directly and in a straightforward and frank manner, despite some language difficulties; that he made concessions where appropriate and was not an advocate for RdE's cause. RdE's submits that Mr Bagnariol had a good recollection of the relevant events, in particular the discussion during the JV Board meeting. (That submission is somewhat hard to maintain given that Mr Bagnariol did not recall various aspects of the events in August-September, such as having asked to prepare the August board meeting minute, until shown the document in question and was at pains to emphasise how many emails he receives a day in his current role.) 3. RdE argues that the evidence of Mr Hughes was unconvincing. It says that the version he gave of the meeting in his affidavit was incomplete and inaccurate on any view (I agree) in that it suggested that there was immediately a discussion about the proposed Called Sum after Mr Hughes had determined that a quorum was present whereas Mr Hughes accepted in cross-examination that, after he had determined that a quorum had been present, there was first a discussion about another matter before discussion about the proposed Called Sum. 4. It is submitted that the suggestion that there were two separate occasions when Mr Hughes sought to determine whether the requisite quorum was present strains credulity and is not corroborated by any other witness. 5. It is said that the evidence of Mr Hughes in his first affidavit as to who (out of Mr Bagnariol and Mr Mortoni) spoke during the meeting was uncertain, since he did not identify who spoke the words and it is submitted that his evidence on this issue in cross-examination "appears to be a convenient reconstruction so as to attribute the crucial words to Mr Mortoni, RdE's Representative on the JV Board". (Pausing there, I do not think Mr Hughes' affidavit can sensibly be read as a suggestion that words were spoken in chorus; rather, I would have read this as being that Mr Hughes was saying that one or other of them had said the words but I accept this indicates some uncertainty in his affidavit as to which of them had actually spoken.) 6. Reference is made to Mr Hughes' use of the expression "would have" said, and it is submitted that the Court should conclude that his evidence should not be preferred to that of Messrs Bagnariol, Mortoni and Chatburn as to the discussions and as to who spoke. Reliance is placed on the evidence of Mr Simbaqueba (in his first affidavit and in the witness box) as confirming that what was proposed was a written resolution to be circulated and executed for the purposes of the making of a resolution. RdE submits that this largely supports Mr Bagnariol's version of events and should be accepted. 7. As to Mr Chatburn, RdE submits that Mr Chatburn's evidence that he heard only Mr Bagnariol speak during the relevant part of the meeting (which supports the version of events given by RdE's witnesses) should be accepted. 8. RdE notes that in his first affidavit, Mr Simbaqueba did not identify who out of Mr Bagnariol and Mr Mortoni spoke on behalf of RdE during the meeting, attributing the words to both Mr Bagnariol and Mr Mortoni. Mr Simbaqueba confirmed in cross examination that this was his best recollection. My assessment of the witnesses 1. I consider below the findings as to the disputed factual issues. First, however, I comment generally on the reliability and/or credibility of the various witnesses who were cross-examined before me. 2. About Mr Chatburn, Mr Simbaqueba and Mr Brollo there is little that need be said. Their evidence was straightforward and there was nothing to suggest that I could not accept what they recalled as being their present recollection of events. Mr Brollo made appropriate concessions as to Mr Simbaqueba's historical performance in assessing the sub-contractors' invoices and the like. Mr Chatburn was up-front in correcting his affidavit and I see no reason not to accept that evidence. Insofar as he had difficulty recalling various things, that was a common failing. 3. That brings me to Mr Hughes, Mr Bagnariol and Mr Mortoni. 4. Both Mr Hughes and Mr Bagnariol, it seemed to me, presented as credible witnesses. Their recollection on particular events was not always detailed. Mr Hughes' evidence was perhaps influenced by his obvious views as to the characterisation to be put on what occurred at the meeting. Mr Bagnariol had a tendency to distance himself from recollection of particular emails or the like and his detail of the meeting was firm on some events but surprisingly vague on others (such as how much was being proposed as the amount of the Called Sum). Nevertheless, I considered that both Mr Hughes and Mr Bagnariol were endeavouring to give truthful evidence. Mr Hughes' account of events is consistent with the steps that he took immediately after the meeting. Mr Bagnariol's emphatic statement that RdE was not a bank and his account of his reaction to Mr Mortoni's lack of participation in the JV Board meeting rang true. Where I do not accept parts of their accounts of events it is because I think there is a more consistent explanation to be found by reference to the context in which things happened and the events that took place at the time. 5. Mr Mortoni I have more difficulty in accepting as a credible witness. There were certainly aspects of his evidence that rang true (such as his answer to the question as to whose voice he first heard when he joined the teleconference – namely, the operator asking his name). However, he had a tendency to argue or debate propositions with Counsel (see for example T 131.12 and his responses at T 122.16; T 122.30) and to argue his (or his company's) case (such as the emphasis placed by him on the main focus at the time being the topic of the $10.9m, even though the meeting was convened to discuss and agree the $8.5m Called Sum). His initial evidence as to what Mr Bagnariol said to him in the telephone conversation after the 19 September meeting (as to why he did not attend the "full meeting") could not have been correct as Mr Bagnariol could not at that stage have known that Mr Mortoni was absent for any part of the meeting. I accept that this was later clarified by Mr Mortoni but it gave me some pause in considering Mr Mortoni's evidence overall. Moreover, even allowing for the fact that English was not his first language, my observation was that Mr Mortoni he appeared to take refuge in labelling questions as confusing (such as when he was pressed as to whether he had agreed to the $8.5m proposal – see T 122.25-34). 6. There are aspects of Mr Mortoni's evidence that I find implausible to say the least – not so much that he says he absented himself from a meeting convened to discuss urgent cash flow matters (though that is somewhat surprising since it was the sole topic for the meeting as convened) but that, if he did so, then he would not afterwards have sought to find out what he had missed at the meeting in relation to the proposed Called Sum or what might have needed to be done about it). 7. It is not, however, necessary to do more than to say that, without corroboration, I cannot accept Mr Mortoni's version of events in relation to the 19 September meeting. Disputed factual issues 1. From the above it can be seen that there was a difference in the various accounts as to matters such as the order in which discussions took place, whether a quorum was established once or twice, whether Mr Hughes formally put a resolution to the meeting in the terms he says he did (as opposed to putting forward a proposal for a cash injection of a proposal that there be a Called Sum of $8.5m); and as to whether Mr Mortoni (or for that matter Mr Bagnariol – although I accept that the latter was not a Representative and could not have bound RdE to a vote at the meeting on that issue) said "Yes" to either the resolution or the proposal that there be a Called Sum of $8.5m per partner. 2. As to the order in which the items were discussed, other than going in general to the reliability of the witnesses' recollections, it is relevant when forming a view as to the accuracy of Mr Hughes' notes of the meeting (and how contemporaneous they were). 3. The preponderance of the evidence (including Mr Hughes' own evidence in the witness box) was that what was discussed first (after the teleconference commenced and a quorum was established) was the outcome of the discussions that morning with the client for the claimed $10.9m payment. Yet Mr Hughes' notes record that this was discussed after the discussion (and/or resolution) of the proposal for a Called Sum. I therefore cannot rely on the notes as an accurate record of the order in which the discussion occurred at the meeting. It may be that there is some explanation for this (such as if the notes were loose leaf and out of order when numbered by Mr Hughes) but that was not explored. So I am left with the conclusion that they are inaccurate and that it is more likely that they were not taken as the discussion proceeded during the teleconference but noted at the conclusion. That said, Mr Hughes readily accepted that the order of the discussion was broadly as Mr Bagnariol remembered, so it is not the case that Mr Hughes has an inconsistent recollection of events in that regard. 4. I would not draw anything from the fact that Mr Hughes affidavit does not record the part of the conversation relation to the $10.9m. It would appear that what his affidavit was focussing on in terms of the meeting was the discussion as to the Called Sums. Presumably it was not until there was a suggestion that Mr Mortoni had been absent for the critical part of the discussion that the balance of the discussion of the meeting took on more relevance. 5. As to the suggestion that the question of quorum was formally established twice in the course of a 30 minute teleconference, this seems to me to be surprising and no other witness gave evidence of it. It may well be that Mr Hughes recalls having given thought to this as the meeting progressed but I cannot comfortably conclude that his recollection is accurate when it is not supported by anyone else. 6. The more vexed questions are as to whether the discussion as to a Called Sum (which was the purpose of the meeting and as to which Mr Bagnariol did have a recollection although he could not recall the figure that had been put) was put formally as a resolution, or whether it was simply put as a proposal or a discussion item; and whether either Mr Mortoni or Mr Bagnariol said "Yes" to it. 7. As to the first, Mr Hughes' evidence was that there was a resolution (as such) put to the meeting. However, both Mr Chatburn and Mr Simbaqueba speak in terms of a proposal: Mr Chatburn recalling that Mr Hughes said words to the effect that "[w]e need a cash injection of $8.5 million from each party by 21 eptember. Is that agreed?"; Mr Simbaqueba that he said words to the effect "OK now we need to decide on the Called Sums. The Project has proposed the amount of $8.5 million each by 21 September". 8. It is understandable that Mr Hughes' recollection of what occurred at the meeting would now focus on the effect of what he understood was there agreed (as a resolution), having proceeded as soon as the meeting finished to draft up a resolution. However, in the light of the evidence from Mr Chatburn and Mr Simbaqueba I cannot comfortably conclude that Mr Hughes phrased the proposal formally in terms of a resolution during the course of the 19 September meeting. Moreover, whether or not Mr Mortoni was in fact in the room at the time of the discussion is more likely to have become apparent if there had been a formal resolution put. Significantly in this regard, Mr Simbaqueba did not distinguish between who was speaking for RdE and Mr Chatburn's recollection was that it was Mr Bagnariol. 9. I am therefore unable to conclude that there was a formal resolution put to the meeting, as such (as opposed to a statement at the conclusion of the discussion that a resolution would be drafted up – something about which, albeit not in the same terms, there was a measure of consistency as to the recollections of the participants at the meeting). 10. That said, there are a number of aspects of what occurred which have led me to conclude that there was assent reached at the meeting to the proposed Called Sum. 11. First, the issue as to called sums was clearly perceived to be urgent by the Project Director, since he had been calling for a meeting to decide this since 8 September 2017. Mr Hughes had prepared notes for the meeting that indicate he was anticipating a discussion as to the financials of the Project for the purpose of debate as to the proposed Called Sums. It seems to me highly unlikely that, the issue as to Called Sums having been raised, it would have been left without some form of agreement at least in principle as to what was to happen (i.e. as to whether there was to be a Called Sum or, if not, what else was to be done). No one suggests that there was any discussion as to a further meeting to discuss the proposal for the Called Sum. 12. Second, almost immediately after the meeting a signed resolution was circulated (i.e., from CPB's perspective it is clear that it thought there had been an agreement for the payment of the Called Sum since otherwise it would have been more logical for the resolution to be submitted in draft). 13. Third, the wording of the email, coming immediately after the Board meeting is consistent with CPB having understood that there was assent to the payment since it refers to "documenting" what had been resolved. Accepting that English is not Mr Bagnariol's first language, it nevertheless is the language of the JV Deed and Mr Bagnariol is not an inexperienced lay person. He is a General Counsel of 8-9 years' experience of a number of companies in the course of his role dealing with hundreds of emails a day and attending various Board meetings. It is inconceivable that he would not have understood what "documenting" in that context meant. He must have understood the email as meaning that the resolution was drafted to document something that CPB believed had been agreed or resolved at the meeting. Mr Bagnariol's explanation as to what he thought "documenting" meant does not accord with common sense and does not accord with commercial business logic. I cannot accept that that is what he thought at the time. 14. The terms of the resolution are also consistent with assent having been reached at the meeting, in that they refer to confirming the resolution agreed. I note that RdE places weight on the reference to ratification as indicating an understanding or acknowledgement that what had taken place at the meeting was incomplete or not effective, but nevertheless the concept of ratification itself presupposes that there was some decision or agreement that needed to be ratified. Hence it is consistent with what was put being a proposal that the parties assented to (albeit not one then giving rise to a binding decision for the purposes of cl 5.4(a) but to be effective when the resolution was signed). 15. Fourth, Mr Bagnariol's evidence was that he left the meeting with the impression that a resolution would be circulated. Despite his explanation of what that meant, it seems to me that one would only expect a draft resolution to be circulated if there was assent to its subject matter. 16. Most significant in my opinion is the email response from Mr Bagnariol 6 minutes after the email requesting that the attached resolution be signed and returned, saying that "we" (RdE) would do so. There was no response indicating the surprise that Mr Bagnariol now says he had at the time. There was no response to say, we have not agreed anything or we will have to consider the proposal or we will have to check with Mr Alzetta or complete some form of authorisation process. Simply an unequivocal "we will do it". That is consistent with Mr Bagnariol well understanding that this is what had been discussed and assented to by the participants at the meeting. 17. Finally, I place weight on the fact that when CPB asked for confirmation as to the timing of the payment, Mr Mortoni did not raise any issue as to the fact that the Called Sum had been the subject of assent between the parties – rather he was explaining that there had been some delay in payment. I cannot see any business logic in the suggestion by Mr Mortoni that he thought this was just CPB trying to encourage RdE to pay $8.5m into the project by doing so itself without there being a Called Sum direction from the JV Board. 18. As to Mr Mortoni absenting himself from the meeting, unfortunately there is only his word for that. It seems to me extraordinary that, in circumstances where Mr Mortoni knew that there was a situation of urgency in relation to the cash flow situation and the Project Director had been pressing for a decision as to a Called Sum; this meeting had been called specifically for that purpose; and he was the only Representative at the meeting, he would not only have absented himself without telling anyone (thus rendering the meeting ineffective in his absence) but would not, when he returned, either explain that he had been called away and ask what he had missed or, after the meeting, try to ascertain from Mr Bagnariol or Mr Hughes or even perhaps Mr McCormack what had happened in this absence and whether any action was required on his part. 19. Mr Bagnariol's evidence in this regard does no more than assist RdE in establishing that Mr Mortoni may not have said "yes" to the proposal. He cannot corroborate that Mr Mortoni left the meeting. He is simply relying on what Mr Mortoni told him. The only people who have been identified who could potentially have corroborated this are Marco Pacco (who is said to have waved Mr Mortoni to come out of the meeting) and Mr D'Agostino, who it is said Mr Mortoni was there speaking to on another project. 20. In that regard, it is not to the point that neither of them was in the teleconference with CPB (which is what RdE raises against the drawing of a Jones v Dunkel inference). What they would potentially be able to give evidence about is to corroborate that Mr Mortoni had in fact absented himself to take another call and for how long he was on that other telephone call. 21. I consider that an adverse Jones v Dunkel inference should be drawn in this regard. I cannot accept Mr Mortoni's evidence on such a crucial issue without corroboration. 22. That said, the fact that I cannot accept that Mr Mortoni absented himself from the meeting does not lead me to conclude that he said "yes" to the Called Sum in a formal sense so as to give rise to a conclusion that there was a binding vote at that meeting. I quite accept Mr Hughes' evidence that he could distinguish between the two voices (Mr Mortoni and Mr Bagnariol) over the telephone. I had the advantage of hearing each of them give evidence in the witness box and I consider that there were difference in the tone and timbre of their voices and in the way that they phrased their responses to questions. However, hearing a sentence or two is different from hearing one word (over a teleconference call where each of Mr Hughes, Mr Mortoni and Mr Bagnariol was in a different location). I think that with the best will in the world there must be scope for confusion as to who was saying "yes". That is illustrated by the fact that Mr Simbaqueba apparently could not distinguish between them and Mr Chatburn thought the only person who was speaking was Mr Bagnariol. Therefore, I am left with doubt as to who it was on the part of RdE that expressed assent to the proposition that a Called Sum be paid (relevant to the issue as to whether there was a decision made as a result of a vote) though I have no such doubt as to there having been a communication to CPB during the teleconference of RdE's assent to such a proposition. 23. For the avoidance of doubt, I have been using the word "assent" as a neutral term so as not to convey the impression that what was assented to at the time amounted to a binding decision or vote or agreement (that being the issue to be considered next). 6. Was there a decision at the meeting as a result of a vote? 1. The first issue raised in this context by RdE is as to whether the quorum requirements under cl 5.5.4 of the JV Deed were met. The next is what was required under the JV Deed for a "vote" to be taken. 2. It is accepted that at the start of the 19 September 2017 meeting there was one Representative of each for the parties (Mr Hughes and Mr Mortoni). However, there is an issue as to the position when and if Mr Mortoni absented himself from the teleconference and a further issue has arisen (as to which supplementary submissions were served by both parties after judgment was reserved) as to whether there is a problem with quorum even assuming Mr Mortoni was not absent as he says he was. 3. The significance of the issue derives, of course, from the authorities that have held that absence of a quorum renders business conducted at the meeting void (Re Alma Spinning Co (Bottomley's case) 1880 16 Ch D 681); that such a meeting cannot make valid or binding decisions (Howbeach Coal Company Ltd v Teague (1880) 5 H&N 157); and that it is not enough that there is a quorum at the beginning of the meeting, there must be a quorum when the relevant business is transacted (Henderson v Louttit (1894) 21 R (Ct of Sess) 674). 4. The further issue is a question of construction of the JV Deed in the present case; namely as to whether there was unequal representation at the JV Board meeting. 5. RdE's position, quite simply, is that there was no quorum; no voting process; and no vote (relying on the evidence of Mr Chatburn, Mr Simbaqueba; Mr Bagnariol and – presumably only as to his absence from the meeting – Mr Mortoni). 6. Excluding Mr McCormack from consideration, on the basis that he was attending as Project Director and not as a representative for either party; and similarly excluding Mr Simbaqueba, as the JV Commercial Manager not being a representative for either party; each JV party was represented in equal numbers (Mr Mortoni and Mr Bagnariol for RdE; Mr Hughes and Mr Chatburn for CPB), assuming Mr Mortoni was present throughout the relevant parts of the meeting. However, RdE takes issue with the fact that there were two Representatives of CPB present; whereas it had only one (or none as the case may be). CPB submissions 1. As to what is required of a "vote", CPB argues that the practical approach adopted by the Courts to decision making by a board of directors of smaller private companies, such as family companies, that accommodates a degree of informality and practicality in the way decisions are made, should here be applied to the decision making process of the JV Board. 2. CPB says that the expression "vote", in the context that it is used in the JV Deed, should reflect a commonsense, practical and commercial approach to decision-making (citing Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407). CPB argues that the expression "vote", where used in the JV Deed, means no more than an expression of assent or dissent by persons entitled to be present and express their opinion upon a subject matter put for decision. CPB says that such an approach is also consistent with the obligation of the parties to perform their functions in good faith (referring to cl 3.4 of the JV Deed). 3. It is submitted by CPB that it is entirely probable under this sort of contract that it might have been completely impractical for elected representatives of the JV Board to be present in the same room at the same time and thereby be able, by ballot or show of hands, to express their opinion; it is said that it is unrealistic and artificial that the parties could have intended this kind of formality. 4. Reference is made to the replaceable rule set out in s 248G of the Corporations Act 2001 (Cth) which provides that resolution of the directors must be passed by a majority of the votes cast by directors entitled to vote on the resolution. It is submitted that the similarity of the replaceable rule 248G and the relevant clauses of the JV Deed are instructive, both requiring a "vote". CPB notes that the Courts have found that a "vote" under s 248G or similar rules adopted by companies themselves does not necessarily mean a physical, literal vote (a show of hands or a ballot for example), referring to Mercanti v Mercanti (2016) 50 WAR 495 (at [169]-[190]); in particular to what was said (at [184]): In summary: (a) Directors may meet informally; (b) Directors may meet without being physically together; (c) The critical point is that there must be a meeting of minds as distinct from a physical meeting; and (d) The directors may concur informally in the company taking a particular action, but they must concur in their capacity as directors in the management of the company's affairs. 1. Reliance is also placed on what was said in Swiss Screens (Australia) Pty Ltd v Burgess (1987) 11 ACLR 756, by Bryson J, as his Honour then was, (at 758): To my mind any event, even most fleeting, in which two directors who are married to each other and are the Company's only directors reach concurrence in taking some course in the Company's affairs can be part of their management of the business of the Company, and can be described with accuracy as a meeting of the directors and as a proceeding at such a meeting. In the course of human affairs it is not to be expected that a recognizable meeting would often take place in which somebody took the chair, there was a call to order, a resolution was made, seconded, debated and voted on. What does seem to me to be essential is that they should both concur in some decision in the management of the business of the Company. 1. CPB also notes what was said in Poliwka v Heven Holdings Pty Ltd (No.2) (1992) 8 ACSR 747 at 786 namely that a "demonstrable expression of will, on the part of all the directors, approving the resolution" may be sufficient to constitute a decision or a resolution. It refers to the decision of Owen J in Bell Group Ltd (in liq) v Westpac Banking Corporation (No.9) (2008) 39 WAR 1, where what was required was described as a "meeting of the minds", a question of substance rather than form (see [5590]). 2. CPB maintains that a quorum was established (on the basis that it should be found that Mr Mortoni did not leave the meeting). As to the issue raised in supplementary submissions filed with leave after the judgment was reserved, CPB argues that there is no issue arising from the fact that Mr Chatburn was also present as a Representative at the meeting. On its case, it was Mr Hughes who exercised the vote. It says that Mr Chatburn did not purport to exercise a right to vote and it was not put to him that Mr Chatburn did so. CPB notes that Mr Simbaqueba did not make any mention of Mr Chatburn purporting to exercise a vote. 3. CPB says that the requirement that each party be represented in equal numbers must be read with cl 6.6.2 and 5.6.4; and that provided the vote is exercised by each party in equal numbers the quorum requirements are satisfied. 4. CPB's case is therefore that the requirements of cl 5.4(a) were satisfied by Mr Hughes and Mr Mortoni exercising a vote. RdE's submissions 1. RdE submits that a "vote at a meeting of the JV Board", as a matter of ordinary language and understanding, requires: a quorum for the meeting; the formulation of a resolution to be voted upon; a call for a vote by each Representative upon the formulated resolution; communication of the vote as cast upon the resolution by each party's Representative; and confirmation of result by declaration. It emphasises that this is a detailed agreement between two sophisticated commercial entities for the purposes of undertaking major public infrastructure works and that it is part of a group of companies based in Italy for whom English is not the first language. Thus it argues that the "vote" procedure was to ensure no confusion or misunderstanding as to what occurs at JV Board meetings (i.e., providing for a vote rather than an agreement or a consensus). 2. As noted above, RdE's position is that there was no vote at the JV Board Meeting on 19 September 2017 in accordance with cl 5.4(a) and that RdE's Representative, Mr Moroni, was not present at the time that discussions about any Called Sum took place. It says that, at most, what was discussed and accepted by CPB's Representatives (Mr Hughes and Mr Chatburn), Mr Bagnariol and the Project Director (Mr McCormack) was that a Board Resolution paper would be prepared and circulated after the meeting, which, upon execution, would be of force and effect pursuant to cl 5.4(b) of the JV Deed. 3. In relation to cll 5.4(a) and 5.6 of the JV Deed, its written submissions referred to the formal requirements for a binding decision to be made by the JV Board pursuant to clause 5.4(a), which it says include "requiring at least one Representative from each party, but an equality of numbers of Representatives for each party" (my emphasis). 4. RdE says it is apparent that there was no decision made at the JV Board Meeting on 19 September 2017 for payment of the Called Sum, pursuant to clause 5.4(a) of the JV Deed, because, first, the parties proceeded pursuant to clause 5.4(b) rather than clause 5.4(a). It says this was made clear by the words spoken by Mr Hughes during the meeting (as to the preparation of a resolution) and confirmed by the circulation after the meeting of a written resolution for signing by the parties' Representatives. RdE says that there was no vote proposed or conducted at the JV Board Meeting as a matter of ordinary language and understanding: Mr Hughes did not propose any motion or decision to put to a vote of the parties' Representatives during the meeting, and nor did any other person present; two (2) of the parties' Representatives, Mr Mortoni and Mr Chatburn, did not say anything at all during the discussion regarding payment of a Called Sum at the JV Board Meeting (and the evidence of Mr Mortoni is that he was not present during any discussion regarding a Called Sum); and in circumstances where any vote had to be unanimous, a decision could only be passed by assent by all of the Parties' Representatives, which did not occur. 5. It is submitted that the subsequent communications make clear that no party regarded what occurred at the meeting on 19 September 2017 as a vote pursuant to clause 5.4(a) of the JV Deed by which any decision was made or any obligation was created. It is said that, whatever was discussed, there needed to be a resolution signed by the Representatives of each party to the JV for the relevant power to be exercised so as to oblige the payment of a Called Sum. 6. Insofar as reliance is placed by CPB on Swiss Screens and the other authorities referred to above, RdE argues that none of those cases concerned the question whether a decision had been made in accordance with a provision such as cl 5.4(a) of the JV Deed, which requires a "decision made as a result of a vote at a meeting of the JV Board" (emphasis as per RdE's submissions). Determination 1. I have no difficulty with the proposition that, for the purposes of the cl 5.4(a) of the JV Deed, a "vote" is required. However, it does not follow from this that the taking of a vote might be conducted in a relatively informal way. The procedures set out in the JV Deed for Board meetings require a quorum and refer to decision "made as a result of a vote" but do not prescribe formal matters as to how the vote is to be taken (by the taking of a ballot or the like). I do not consider that to comply with cl 5.4(a) it would be necessary to approach the taking of the vote with the formality suggested by RdE nor do I consider that this would be necessary by reference to the context and commercial purpose of the provisions in the JV Deed in relation to the exercise of the powers and functions of the JV Board (see [144]-[146] of RdE's closing submissions). Obviously, however, the more informal the process adopted for the taking of the vote, the more doubt there may be as to whether a decision made as a result of a vote was in fact reached in relation to any particular matter. 2. That said, I am not persuaded that the steps taken at the meeting (even applying a test as to whether in substance there was a meeting of the relevant minds) assists unless it can be established that Mr Mortoni not only remained present but also participated in a meaningful way in the JV Board meeting and I cannot conclude that the latter is the case. There is sufficient doubt as to who said "Yes" to the proposal that there be a Called Sum, that I cannot conclude that there was a vote in which the two Representatives participated to that effect. 3. As to the supplementary issue, I do not consider that the JV Deed requires an equality of attendance by number of Representatives. What is required is that each party be represented by at least one Representative (satisfied here except for any time Mr Mortoni was absent) and there be equal numbers represented (here satisfied as set out at [282] above). However, nothing turns on this as I am not persuaded that there was a binding vote at the meeting, for the reasons canvassed earlier. 4. Therefore, I have concluded that there was no binding decision reached by way of vote at the 19 September 2017 JV Board meeting within the meaning of cl 5.4(a) of the JV Deed. 7. Acquiescence CPB submissions 1. The first of alternative ways in which CPB puts its case is based on acquiescence. CPB says that if (as I have found) the events of 19 September 2017 did not result in a decision of the JV Board made as a result of a vote satisfying the requirements of cl 5.4(a) of the JV Deed, then RdE (by its conduct subsequent to and continuing on from the meeting) acquiesced in the making of a decision and resolution satisfying the requirements of cl 5.4 of the JV Deed. 2. CPB argues that there could be no doubt that the email and resolution sent by Mr Hughes shortly after the 19 September meeting reflected an understanding in CPB that a decision had been made to pay the Called Sum. (I agree.) It says that the email shortly after, at 4.44 pm, signified an agreement and promise by RdE to sign the board resolution for the payment of the Called Sum. It says that the offer to minute the meeting is explained by reference to RdE's obligations under cl 5.8 of the JV Deed and use of the words, "along with" indicates that the minutes would reflect the decision to pay the Called Sum. 3. The detrimental reliance is said to be the payment on 22 September 2017, by CPB of $1,500,000 in the Project Account towards its contribution of the Called Sum; its agreement to payments out of the JV Project Account thereafter; and payment on 6 October 2017 of the final tranche of $7,000,000 completing its contribution to the Called Sum. 4. CPB notes that in the period 19 September 2017 to 9 October 2017, RdE remained silent and failed to communicate to CPB the position it now takes in the proceedings. Emphasis is placed on RdE's silence in the context of RdE's express obligations to perform the JV Deed cooperatively and in good faith. 5. RdE's conduct subsequent to the meeting is said to be relevant in two ways. First, it is said that the way RdE behaved is consistent with the decision having been made at the meeting and is also consistent with decisions being made by the JV Board by the expression of consensus following discussion on a proposed resolution. Second, it is said that, by its conduct, RdE acquiesced to the resolution in the form which had been sent to it. 6. As to acquiescence, CPB relies on the principle that a contract may be formed notwithstanding that acceptance has not been formally communicated, noting that where an offeree is under a duty to communicate rejection of an offer, and fails to do so, silence may, in certain circumstances, be regarded as an acceptance of the offer sufficient to form a contract. It argues that that principle can be comfortably applied to the circumstances of the present case where what is required is the making of a decision by consensus at a meeting of representatives. 7. CPB submits that RdE's conduct subsequent to the meeting on 19 June 2017 is entirely consistent with a decision having been made to pay the Called Sum and cannot be explained on any other reasonable basis. RdE's submissions 1. RdE says that its conduct following the JV Board Meeting did not constitute "acquiescence" or "assent" to the payment of a Called Sum and, in any event, such conduct could not and did not create any obligation pursuant to the JV Deed or otherwise to pay the Called Sum having regard to the terms of the JV Deed, in particular cll 20.9 and 20.10, which provide that no modification, variation or amendment of the JV Deed is of any force unless in writing and executed by each party and that a failure to exercise or to enforce (or delay in so doing or partial exercise or enforcement of) any right, remedy or power under the JV Deed does not preclude or operate as a waiver of any further or other exercise of enforcement of any right, remedy or power under the deed or provided by law. 2. RdE maintains that there is no proper juridical (or factual) basis for CPB's claim that RdE "acquiesced and therefore assented to payment of the Called Sum" (as set out at [7], [8] and [9] of CPB's List Statement). 3. RdE notes that, as a matter of law, a "claim" of acquiescence is a defence against an equitable claim, which requires calculated (that is, deliberate and informed) inaction by a party that encouraged another party reasonably to believe that its conduct was accepted or not opposed (referring to Byrnes v Kendle (2011) 243 CLR 253; [2011] HCA 26 at [79]; Orr v Ford (1989) 167 CLR 316 at 337-338, 340); whereas it says what CPB seeks to allege is that RdE's conduct somehow created an obligation pursuant to the terms of the JV Deed to pay a Called Sum. RdE says that that contention does not withstand scrutiny. 4. RdE says that the obligations under the JV Deed are only created by operation of the JV Deed. Under the terms of the JV Deed, proposed obligations are accepted by a party when its Representative formally votes in favour when the matter is put to a vote or a written resolution is signed. The obligation is created when the matter the subject of the vote receives unanimous assent or the written resolution is signed by both parties. 5. Therefore, it says, under the JV Deed, obligations do not materialise as a matter of general conduct and cannot be imposed. Obligations can only be created in specific circumstances of acceptance and agreement as prescribed by the JV Deed. Whatever occurred after the meeting on 19 September, absent any execution of the written resolution, there was no binding obligation created. Determination 1. The term "acquiescence" bears a number of meanings in law, as noted by the Court of Appeal in Rodger v De Gelder (2011) 80 NSWLR 594; [2011] NSWCA 97 at [81]-[83]): In Meagher, Heydon, Leeming, Meagher, Gummow & Lehane's, Equity: Doctrines and Remedies 4th ed (2002) Butterworths Australia, the authors state, at [36–090], that acquiescence has three meanings. First, it can refer to equitable estoppel in the sense used in Ramsden v Dyson (1866) LR 1 HL 129. … Secondly, acquiescence can refer to an element of laches in the sense that a person, over a long period of time, with full knowledge of the person's rights, refrains from exercising those rights in circumstances where it can be inferred that the rights have been abandoned. When used in this sense, it involves waiver, affirmation and release. The third sense in which the term acquiescence is used is referable to that type of laches which involves prejudice to third parties. The authors note that mere delay, of itself, is not enough to constitute either laches or acquiescence: Jones v Stones [1999] 1 WLR 1739. See Equity: Doctrines and Remedies at [36–050] and [36–070]. Acquiescence, as described in the second and third senses, may be relied upon as a discretionary defence in an equity suit. 1. In the present case, acquiescence appears to be invoked in the first of those senses as an equitable estoppel. In essence, it requires CPB to establish the elements considered on its estoppel claim considered in answer to issue 8, so I will deal with it in that context. To the extent that CPB also invokes acquiescence in one or both of the other senses considered in Rodger v De Gelder, in view of my conclusions below in relation to promissory estoppel, I do not consider it necessary further to consider the question of acquiescence. 8. Estoppel CPB submissions 1. The second way CPB put its alternative case was that RdE is estopped from denying "that a valid decision was made by the JV Board satisfying the requirements of cl 5.4(a)" (see [1] of the Amended List Reply). CPB asserts that: RdE promised and represented that it would pay the sum of $8.5m by way of a Called Sum on or before 6 October 2017 without the need for a formal vote; and RdE promised and represented that it would have its Representatives sign a resolution for the payment of a Called Sum of $8.5m on or before 6 October 2017. 2. As to the alleged representation, CPB relies on: a representation said to have been made at the 19 September 2017 JV Board Meeting by Mr Mortoni and Mr Bagnariol that RdE agreed to pay the Called Sum of $8.5m by 6 October 2017 and that RdE's Representatives would sign and return a resolution to that effect; a representation by email immediately after the JV Board Meeting, in which Mr Bagnariol "re-confirmed" that RdE's Representatives would sign and return the resolution which CPB had submitted. 3. For the assertion that there was an estoppel in pais, reference is made to what was said in DHJPM v Blackthorn Resources Ltd (2011) 83 NSWLR 728; [2011] NSWCA 348, by Meagher JA at [44], applied with approval in Doueihi v Construction Technologies Australia Pty Ltd [2016] NSWCA 105 at [160]-[161]. 4. CPB identifies the relevant assumption or expectation arising from RdE's conduct subsequent to the meeting as being that: Mr Mortoni had agreed to the payment of the Called Sum; Mr Mortoni would sign the resolution issued recording the decision to pay the Called Sum; the process adopted at the meeting of 19 September 2017 concluded in a decision as a result of a vote for the payment the Called Sum; and RdE would pay the Called Sum by 6 October 2017. 5. It is submitted that that conduct gives rise to at least the following representational estoppels: an estoppel of an existing fact, namely, that a decision had been reached on 19 September 2017 to pay the Called Sum; and a promise to perform or perfect that decision. 6. Thus it is argued that RdE is estopped from denying that the events of 19 September 2017 resulted in a decision complying with the requirements of the JV Deed. 7. As to detriment, again CPB points to its payment to pay in $8.5m. It says it has made a disproportional contribution to JV liabilities, whereas each party agreed to a Participating Interest of 50% under the JVD. CPB says that it also lost the opportunity to withhold payment of the Called Sum and to invoke the dead lock procedures in cl 5.7. Further, CPB says it has suffered and continues to suffer relational and reputational damage. RdE's submissions 1. RdE, consistent with its position in response to the acquiescence claim, says that it is not estopped from denying there was a decision pursuant to cl 5.4(a) in respect of payment of a Called Sum. 2. RdE submits that CPB's claimed estoppel by representation must fail for four reasons. 3. First, it says that the evidence does not establish that the asserted representations were made by RdE. 4. Second, it points to the particulars to the contention and says that it was the execution of the written resolution that could create an obligation to pay the Called Sum and that the representatives of CPB knew that, until the written resolution was executed, there was no valid direction by the JV Board for the payment of any Called Sum and no obligation to pay any Called Sum. RdE says that, if and to the extent that CPB claims it "relied on" the conduct of RdE, it must be alleging that RdE represented that it would not adhere to the terms of the JV Deed and was content to waive, vary or modify the terms. RdE says that no such representation was made by the conduct alleged. Further, it says that to the extent that CPB assumed this was the case from the alleged conduct, the assumption is plainly inconsistent with cll 20.9 and 20.10 of the JV Deed and therefore unreasonable. 5. RdE notes that in the period after the JV Board Meeting, CPB points to only one alleged representation in which RdE "promised or represented" to CPB that RdE "would sign and return the resolution which the Plaintiff had submitted", namely that in the email of 19 September 2017. It says that this was never followed up by CPB before CPB made payments totalling $8.5m on 22 September and 6 October 2017. 6. RdE submits that CPB simply elected to pay the moneys in advance of any obligation to do so under the terms of the JV Deed in circumstances where it was known by both parties that execution of the proposed written resolution was necessary to create an obligation on the parties to pay a Called Sum. RdE says that CPB did not rely on any promises or representations made to it by RdE, as RdE never represented that it was content to accept a waiver, modification or variation of the JV Deed in respect of any Called Sum. Alternatively, it says that any reliance on such promises or representations was not reasonable in the circumstances. 7. Third, RdE says that, for the same reasons, it cannot seriously be suggested that RdE induced or acquiesced in CPB's conduct. It is submitted that Mr Bagnariol's statement that RdE "would sign and return the resolution which the Plaintiff had submitted" cannot reasonably have induced CPB to assume that RDE would pay the Called Sum without the execution of the proposed written resolution by the Representatives of the parties. 8. Fourth, it is said that CPB has suffered no detriment as a result of the alleged representations. RdE argues (referring to the definition of "Participating Interest" in cl 1.1, which included a proportional share both in the obligation to contribute to Called Sums according to Budgets (cl 1.1(c)) and of all other rights and liabilities and any losses accruing to or incurred by the Parties under or arising out of or in connection with the JV Deed or the D&C Deed (f)) that both parties are equally liable for losses and costs of the JV. It says that, to the extent that CPB has contributed more funds to the JV's Project Account at present, it can recover those amounts from RdE under the terms of the JV Deed. It says that the question whether and to what extent CPB has paid more moneys into the Project Account than RdE, that is a matter for final reconciliation; it does not create a current liability on the part of RdE to pay the Called Sum. 9. For these reasons, it is said that CPB's estoppel claim fails. Determination Estoppel by representation 1. An estoppel by representation arises "where a person is prevented, as a matter of law, from denying or from asserting, as the case may be, the existence of some fact, irrespectively of whether it really exists" (Franklin v Manufacturers Mutual Insurances (1935) 36 SR (NSW) 76, 80 (Jordan CJ). RdE's reference to it as "a species of equitable estoppel" is to be understood in the sense that its origins lay in the Chancery (see Hunt v Carew (1649) 21 ER 786) (though it was adopted later adopted by the common law and operates identically; see K Handley, Estoppel by Conduct and Election (2nd ed, 2016, Sweet & Maxwell) at [1-001]-[1-004]; [1-017] fn 83). 2. Broadly speaking, to establish such an estoppel there must be an express or implied representation of past or present fact that is communicated to the representee and upon which he or she relies to his or her detriment (see Thompson v Palmer (1933) 49 CLR 507 at 520 (Rich J); Franklin v Manufacturers Mutual Insurances at 82 (Jordan CJ)). The representation must be clear and unequivocal (Legione v Hateley (1983) 152 CLR 406 at 435-436). 3. Jorden v Money (1854) 10 ER 868 stands for the proposition that estoppel by representation is confined to representations of fact, not of intention. That authority binds this Court (Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 at 399; 415-416; Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466, 472; Sidhu v van Dyke (2014) 251 CLR 505; [2014] HCA 19 at [58]; see also the authorities noted in Handley, Estoppel by Conduct and Election at [2-003]; [2-010])). Reflecting this position, one can distinguish between "a representation (of an existing or past fact)" and "a voluntary promise about the speaker's future conduct" (Equititrust Ltd v Franks [2009] NSWCA 128 at [73]; my emphasis). 4. Adopting this terminology, the difficulty in the present case for CPB is that the allegations involve both representations (namely, that a decision had been reached) and promises (namely, that Mr Mortoni would sign the resolution; that RdE would pay the Called Sum). If these promises are to be put forward as giving rise to an estoppel, it can only be on the basis of a promissory estoppel (as to which, see below). It was no doubt for this reason that CPB advanced a two-limbed estoppel argument (T 8): The first part of the estoppel case is that [RdE] is [estopped] from denying that there was a decision of the Board made on 19 September in consequence of what happened at the meeting and following of which these two emails form part. … The second part of this novel case which your Honour asked me to be more clear about, I need to formulate. … What we say is this; in consequence of the promise made to sign the resolution and return it confirming the decision of the Board, we say [RdE] is estopped from asserting there was a valid resolution falling within the second part of the decision making process, that is the written resolution aspect of it; that is how we put it. … 1. As adverted to above, in respect of the alleged representation (namely, that a decision had been reached), this was said to be as a result of conduct at the meeting (T 149.17) and the subsequent conduct (which was consistent with this having occurred and inexplicable on any other reasonable basis). 2. I am not satisfied, on the balance of probabilities, that such a representation (as to a valid resolution having been made) was in fact made at the meeting for the reasons set out earlier. As to the submission that the subsequent conduct is not explicable on any other reasonable basis, as already adverted to, I consider that the conduct is explicable on the basis of assent at the meeting falling short of a binding decision. (If I am wrong as to the existence of such a representation, then a difficulty for CPB is that it knew the formal requirements that had to be satisfied for a binding decision to be reached and therefore cannot reasonably have relied on a representation that those requirements had already been met. The position might be different if the representation were to have been that RdE would not insist upon a formal vote or would not rely upon the lack of formal processes to deny a binding agreement had been reached, but those representations have not been pleaded and it is not clear in any event that they could be made out by reference to the accounts given of the discussion at the 19 September 2017 meeting.) That in effect disposes both of the acquiescence case and the related estoppel by representation case. 3. Assuming that an estoppel by representation had been established, I note that estoppel by representation is often characterised as a rule of evidence; as "one step in the progress towards relief on the hypothesis that the defendant is estopped from denying the truth of something which he has said" (Low v Bouverie [1891] 3 Ch 82 at 105). Accordingly, its effect would not be "to create a right in one party against the other" as such; rather, it would be "to establish the state of affairs by reference to which the legal relationship between them is ascertained" (Waltons Stores v Maher at 413 (Brennan J)). Promissory estoppel 1. In the present case, CPB contends that RdE promised to sign the written resolution and that CPB relied upon this promise (T 163.31-32). CPB expressly formulated its claim in this context under the rubric of promissory estoppel. A threshold question therefore concerns the significance, if any, to the present case of recent authorities concerning the limitations of promissory estoppel. 2. It has been said that promissory estoppel is "based on a non-contractual promise or assurance which, in its orthodox form, becomes binding in equity, so as to restrain the promisor from enforcing his strict legal rights" (Equitrust Ltd v Franks [2009] NSWCA 128 at [70]). Recent Court of Appeal authority has emphasised this negative characterisation of promissory estoppel (see Saleh v Romanous (2010) 79 NSWLR 453; [2010] NSWCA 274 at [73]-[74]; DHJPM at [93]; Van Dyke v Sidhu [2013] NSWCA 198 at [38]-[39]). It is said that promissory estoppel is not to be treated as the "equitable equivalent of a contract" (Saleh v Romanous at [73]). 3. Such authorities are binding on this Court, though I note that the law may not be finally settled (Ashton v Pratt (2015) 88 NSWLR 281; [2015] NSWCA 12 at [102]-[140]; [263]; Hawcroft General Trading Co Pty Ltd v Hawcroft [2017] NSWCA 91 at [49]; see generally, A Robertson, "Three Models of Promissory Estoppel" (2013) 7 Journal of Equity 226; A Silink, "Can Promissory Estoppel Be an Independent Source of Rights?" (2015) 40(1) The University of Western Australia Law Review 39). The authors of Meagher, Gummow & Lehane's Equity suggest that academic criticism in the wake of cases such as Saleh has been too quick, the "controversy" being in their view more apparent than real. They contend that the import of the reasoning in cases like Saleh and DHJPM is merely that promissory estoppel is preclusionary in nature (see Meagher, Gummow & Lehane's Equity: Doctrines and Remedies at [17-270]) – namely, that it creates "no legal relationship or cause of action where none previously could arise" but it may, in certain circumstances, preclude a party from denying that such a relationship has arisen. In such a case, the parties would be bound to certain legal relations, such as an intended contract, by a court of equity and their obligations are then governed by reference to that postulated relationship (Meagher, Gummow & Lehane's Equity: Doctrines and Remedies at [17-270]-[17-280]). 4. In my opinion, the above authorities (to which I was not taken in argument during the course of the hearing nor were they raised in written submissions) do not necessarily prevent CPB from raising a promissory estoppel in the circumstances of the present case. CPB and RdE were both parties to the JV Deed and had representatives on the JV Board. It can be inferred from the parties' communications that what was in contemplation was the exercise of the JV Board's powers in accordance with cl 5.4(b) (namely, a written resolution signed by the current Representatives of each Party). In other words, the powers that were to be exercised were those arising in the context of the rights and responsibilities established by the parties' pre-existing contractual arrangements. 5. This is not, therefore, a case in which a party is attempting to raise a promissory estoppel so as to acquire some positive right to relief in equity independent of a postulated contract. If the promissory estoppel is successfully asserted, this Court would not be creating a contract for the parties; rather, RdE would be bound in conscience from denying that it stands in the postulated legal relationship – namely, that envisioned by the JV Deed, (to which, I emphasise, both CDP and RdE were a party) upon due exercise of the JV Board's powers in accordance with cl 5.4. 6. I turn now to the elements of promissory estoppel. Broadly speaking, a promissory estoppel will be established if: first, CPB assumed that a particular legal relationship would exist between it and RdE; second, RdE induced CPB to adopt that assumption or expectation; third, CPB has acted or abstained from acting in reliance on that assumption or expectation; fourth, RdE knew or intended CPB to do so; fifth, CPB's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and sixth, RdE has failed to act to avoid that detriment, whether by fulfilling the assumption or expectation or otherwise (Waltons Stores v Maher at 428-429 (Brennan J)). 7. As to the first element, it is clear that CPB assumed that a particular legal relationship would exist between it and RdE; i.e., that as between it and RdE the execution of the resolution would give rise to obligations under the JV Deed. 8. As to the second element, I am satisfied that RdE induced CPB to adopt that assumption or expectation. The relevant inducement is to be found in RdE's conduct after the JV Board meeting which I consider amounted to a promise that it would sign a resolution confirming and/or ratifying an agreement to pay the Called Sum. 9. In this regard, I note that the requisite certainty for the relevant representation or promise for the purposes of a promissory estoppel was recently considered by the High Court in Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 333 ALR 384; [2015] HCA 26. The plurality cited with approval (at [35]) the remarks in Low v Bouverie, an estoppel by representation case, to the effect that: an estoppel must be "clear", "precise" and "unambiguous"; this does not mean that the words used may not be open to different constructions; and the conduct must be capable of misleading a reasonable person in the way that the person relying on the estoppel claims he or she has been misled. 10. In the present case, the representations and promises were both express and implied. Mr Bagnariol's email of 4.44pm on 19 September 2017 ("Yes, we will do it along with the Minute of the Meeting") must be viewed in the context of the email (sent only six minutes earlier) to which it was responding, being a formal request by CPB's Representative attaching documentation prepared in accordance with the JV Deed (cf Legione v Hateley). RdE's immediate assent through Mr Bagnariol to this request for the signing of the written resolution was clear, unequivocal and unambiguous. Moreover, it was followed not only by a period of silence in which there was no suggestion by RdE that the assumption on which CPB was operating was incorrect but also by an e-mail from Mr Mortoni on 9 October 2017 confirming that RdE was "confident" that its "cash contribution" would be made "in the next few days". 11. As to the third element, CPB relied to its detriment on the representations and promises by paying its $8.5m contribution to the Called Sum and by not taking steps to prevent the payment out to third party creditors of that amount, or otherwise invoking the default processes of the JV Deed. 12. As to the fourth element, it was or must have been apparent to RdE that CPB was proceeding from 19 September 2017 on the basis of an understanding that there had been agreement to pay the Called Sum. To the extent that Mr Mortoni or Mr Bagnariol contend otherwise, I do not accept that evidence as credible. Their communications subsequent to the meeting (and prior to the notice of default being issued) are inconsistent with the proposition that they did not understand CPB to have been proceeding in the belief that there had been agreement to the payment of the Called Sums. 13. As to the fifth element, I am satisfied that CPB's action or inaction will occasion detriment if the assumption or expectation is not fulfilled, not simply because of the potential reputational damage (which I accept will be difficult to assess) but also because of the risk to the ultimate completion of the principal contract in the interim (noting that it is a loss making project), even though (as RdE points out) there is provision for a final reconciliation of the JV parties' contributions to the JV to take place in the future. 14. As to the sixth element, RdE has failed to act to avoid that detriment, whether by fulfilling the assumption or expectation or otherwise. 15. I therefore find that the claim based on promissory estoppel has been established. 9. Relief CPB submissions 1. CPB submits that declarations in the form of those set out in paragraphs 1-3 of the summons should be made; and that an order sought in the nature of a mandatory injunction for payment of money should also be made. 2. Insofar as the relief sought is in the nature of or similar to specific performance (of the deed), and noting that equity does not grant the remedy of specific performance of deeds where no party has provided consideration (as equity will not come to the aid of a volunteer – see Young, Croft and Smith, On Equity (2009, Lawbook Co) at 1088; Jefferys v Jefferys (1841) Cr & Ph 138; 41 ER 443; Silver v Dome Resources NL (2007) 62 ASCR 539 at 568-574; [2007] NSWSC 455; Dome Resources NL v Silver [2008] NSWCA 322), CPB argues that equity looks to substance not form and will grant specific performance of an agreement that might be labelled a "deed", but for which consideration was provided by the parties (referring to Jefferys v Jefferys; Silver v Dome Resources NL generally and at [121]). Reference is also made to the analysis as to why an agreement annuity can be specifically enforced, and a mandatory injunction can be granted to compel payment of the annuity (see Meagher, Gummow & Lehane's Equity: Doctrines and Remedies at 658 and the authorities cited at fn 111), damages there not being an adequate remedy because the agreement would have to be separately enforced for each payment. 3. The consideration for the deed is identified by CPB as the bundle of mutual promises and obligations made by each of the parties to the deed, whereby each party's promises represent consideration for the promises and obligations of the other (see Carter, 117 [6-13]; Perry v Anthony [2016] NSWCA 56). 4. CPB says that the promises and assumed obligations of RdE are made in consideration for CPB making substantially the same promises and assuming substantially the same obligations and vice versa. 5. CPB accepts that the Court will not grant a mandatory injunction if damages are an adequate remedy (referring, inter alia, to Costin v Costin (1997) 7 BPR 15,167) but says that damages are not an adequate remedy in this case for a number of reasons: first, the obligations under the JV Deed are continuing and the Called Sum is required to fund continuing liabilities of the JV to creditors; second, damages cannot be adequate because CPB is not seeking payment to it of any some of money; it is seeking payment of the Called Sum to the Project Account for the use of the joint venture; third, the funds are necessary for the continuation of the Project now, whereas damages could not realistically be assessed unless or until the Project is either completed or not completed or completed with some delay, which assessment would necessarily take place some time after the conclusion of the Project (or the ultimate failure of the project). It is thus said that it is not possible now to assess what damage might be caused by the failure to pay the Called Sum. 6. Further, it is said that CPB is continuing to suffer reputational damage, the most adequate remedy for which is to remove or eliminate the source of that reputational damage, being an order that funds be paid to allow the project to continue and for creditors to be paid. CPB points out that damages for reputational damage would be extremely difficult to assess with any degree of accuracy (referring to the observations in Meagher Gummow & Lehane, Principles of Equity at [20-050]). 7. Finally it is said that it would be an inadequate remedy for CPB to have to enforce the agreement, seeking final relief, on each occasion on which a Called Sum was not paid in the context of an agreement that imposes continuing obligations on the parties over time. 8. CPB argues that the balance of convenience favours the granting of the injunction. It says that if the injunction is refused, creditors will not be paid and the continuing obligations under the JV Deed and the D&C Deed will be put at risk. RdE's submissions 1. As to whether the Court can or should order RdE to pay the amount of $8,500,000 into the Project Account, apart from disputing CPB's entitlement to any of the relief sought in the summons, RdE says that whether paragraphs 4 and 5 of the summons are properly characterised as orders seeking mandatory injunctions or as seeking relief in the nature of specific performance, CPB is not entitled to such equitable relief, because it has not demonstrated that damages for breach of the JV Deed (in particular cl 10) would not be an adequate remedy. 2. RdE notes that the grant of equitable relief such as mandatory injunctions and specific performance is discretionary. The fundamental criterion for the granting of such relief is that damages would not be an adequate remedy (see Spry, The Principles of Equitable Remedies (9th ed, 2014) at 61-62; Meagher, Gummow & Lehane's Equity: Doctrines & Remedies at [21-460]). It says that CPB has failed to demonstrate by its evidence that damages would not be an adequate remedy. And, insofar as what is sought is a mandatory injunction akin to specific performance, it emphasises that Silver v Dome Resources NL supports the proposition (at [121]) that in equity specific performance will not be granted without consideration or where an agreement has not been validly and properly made. 3. It is submitted that in the event that the Court finds that CPB is entitled to any relief, damages would in fact be an adequate remedy for CPB. 4. Insofar as paragraph 5 of the summons seeks an order that RdE "authorise payment of the amounts of the said Called Sum and interest out of the Project Account to meet outstanding payment liabilities of the joint venture", it is said that such an order would amount to an order depriving RdE of its rights under cll 7.3 and 7.4 of the JV Deed, to scrutinise and approve payments out of the JV Project Account. 5. RdE says that, by seeking a mandatory injunction or an order in the nature of specific performance, CPB cannot achieve any better relief than what it is entitled to in accordance with its strict contractual rights. Determination 1. I concluded earlier that RdE is estopped in all the circumstances from acting inconsistently with its promise to sign the written resolution. The question therefore becomes one as to the appropriate relief. The orthodox view treats an operative promissory estoppel as a restraint on the enforcement of contractual rights (including contractual powers; see Anaconda Nickel Ltd v Edensor Nominees Pty Ltd [2004] VSCA 167). In Silovi v Barbaro (1988) 13 NSWLR 466, Priestley JA (with whom Hope and McHugh JJA agreed) included in the distillation of the reasoning of the High Court in Waltons Stores v Maher the proposition that the remedy granted to satisfy the equity (which either is the estoppel or created by it) will be what is necessary to prevent detriment resulting from the unconscionable conduct. The present is not a case in which equity would be compelling the enforcement of an incomplete bargain (cf Handley, Estoppel by Conduct and Election at [13-045]) or creating entitlements other than by reference to a postulated contract. The notion that promissory estoppel may not be used as a sword, or is to be conceived in negative terms, does not prevent it from being invoked so as "to preclude the defendant from denying the existence of facts which, if they existed, would give rise to legally enforceable rights between the parties" (see Meagher, Gummow & Lehane's Equity at [17-270]; and see [12-275]-[17-280]). 2. In the present case, CPB's successful assertion of a promissory estoppel has the effect of precluding RdE from resiling from its promise to sign the JV Board Resolution and therefore from acting inconsistently with the assumption on which CPB acted to its detriment; namely, that RdE would in due course sign the resolution. 3. To the extent that this is relevant in considering the remedy for an operative promissory estoppel in the circumstances of this case, I accept the submissions by CPB as to why damages would be an inadequate remedy. In particular, in circumstances where the obligations under the JV Deed are continuing and the Called Sum is required to fund continuing liabilities of the JV to third parties, the risk of disruption to the completion of the Project and the potential reputational damage to CPB, coupled with the fact that it is unlikely that damages could be realistically assessed unless or until the completion (or otherwise) of the Project, points to the inadequacy of damages as a remedy. 4. In the present case, the appropriate relief to make good CPB's detrimental reliance is to preclude RdE, in the context of the pre-existing rights and obligations of the parties under the JV Deed, from acting inconsistently with its promise; RdE is therefore obliged in equity to sign the resolution that it promised it would sign and return back in September 2017 almost immediately after the JV Board meeting had concluded. I will so order. Orders 1. For the above reasons, I make the following orders: 1. Dismiss the defendant's motion for a stay of the proceedings. 2. Order the defendant within 14 days to sign and return to the plaintiff the Joint Venture Board resolution dated 19 September 2017. 3. Reserve the question of costs. 4. Direct the parties within 28 days to serve short written submissions on the question of costs with a view to the question being determined on the papers. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 December 2017