ACN 168 479 614 Pty Ltd (formerly known as Steller Developments Pty Ltd) (in liq) (Receivers & Managers appointed) v Smedley, in the matter of ACN 168 479 614 Pty Ltd

Number of paragraphs: 93

Dates of hearing: 10 and 11 February 2025

Counsel for the Applicant: Mr M Izzo SC with Ms A Smith

Solicitor for the Applicant: Hogan Lovells

Counsel for the First Respondent: Mr J C Giles SC with Ms N Papaleo

Solicitor for the First Respondent: Lander & Rogers

Counsel for the Second Respondent The second respondent did not appear

Solicitor for the Third Respondent: The third respondent appeared in person

Counsel for the Fourth Respondent: Mr D Porteous

Solicitor for the Fourth Respondent: Strongman & Crouch

Solicitor for the Fifth Respondent: The fifth respondent did not appear

First Cross-Claim: Counsel for the Cross-Claimant on the First Cross-Claim: Mr D Porteous

Solicitor for the Cross-Claimant on the First Cross-Claim: Strongman & Crouch

Counsel for the First Cross-Respondent on the First Cross-Claim: Mr J C Giles SC with Ms N Papaleo

Solicitor for the First Cross-Respondent on the First Cross-Claim: Lander & Rogers

Counsel for the Second Cross-Respondent on the First Cross-Claim: The second cross-respondent appeared in person

Counsel for the Third Cross-Respondent on the First Cross-Claim: The third cross-respondent appeared in person

ORDERS NSD 1300 of 2021 IN THE MATTER OF ACN 168 479 614 PTY LTD (FORMERLY KNOWN AS STELLAR DEVELOPMENTS PTY LTD) (IN LIQUIDATION) (RECEIVERS AND MANAGERS APPOINTED) BETWEEN: ACN 168 479 614 PTY LTD (FORMERLY KNOWN AS STELLAR DEVELOPMENTS PTY LTD) (IN LIQUIDATION) (RECEIVERS AND MANAGERS APPOINTED) Applicant NICHOLAS SMEDLEY First Respondent AND: SIMON PITARD Second Respondent JAMES CIRELLI Third Respondent FIRST CROSS-CLAIM: BETWEEN: THOMAS VINES Cross-Claimant AND: NICHOLAS SMEDLEY (and others named in the Schedule) First Cross-Respondent

order made by: GOODMAN J DATE OF ORDER: 27 february 2025

THE COURT ORDERS THAT:

1. By 14 March 2025, the parties are to confer as to the appropriate orders for relief to give effect to these reasons for judgment and are to provide to the Court: (1) a joint set of orders which may be made by consent; (2) to the extent that agreement has not been reached: (i) competing sets of proposed orders; and (ii) an agreed proposed timetable for the filing of any further submissions concerning those competing orders.
2. The proceeding be listed for a case management hearing on a day after 14 March 2025, such date to be arranged in consultation with the Associate to Goodman J. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT GOODMAN J

A. INTRODUCTION 1 This proceeding concerns a deed titled "Deed of Guarantee" executed as a deed poll on 7 March 2017 (7 March 2017 Deed) by each of the respondents (Mr Nicholas Smedley, Mr Simon Pitard, Mr James Cirelli, Mr Thomas Vines and Steller Estate Pty Ltd), each of whom was described in the 7 March 2017 Deed as a Guarantor. 2 Clause 2(a) of the 7 March 2017 Deed provided in part that "[e]ach Guarantor guarantees the due and punctual payment of the Secured Money by the Issuer to the Investors". The "Issuer" was defined in cl 1.1 of the 7 March 2017 Deed as meaning "Steller Investment Notes Pty Ltd" (SIN). 3 Clause 1.1 of the 7 March 2017 Deed also defined the "Manager" as meaning "Steller Developments Pty Ltd (ACN 168 479 614)". 4 Steller Developments, which was subsequently placed into liquidation, brings this action in its capacity as "Manager" against each of the Guarantors claiming that the Guarantors are liable to it in a different capacity, namely "Issuer", on the basis that under the 7 March 2017 Deed as properly construed, or as rectified, Steller Developments and not SIN was the "Issuer". Steller Developments seeks an order that the Guarantors pay it an amount of $101,914,373.66 plus interest from 1 January 2019. 5 Mr Smedley, Mr Cirelli and Mr Vines are the only active respondents. On 3 March 2022, I made orders granting leave to Steller Developments to proceed against Mr Pitard (a bankrupt) and Steller Estate (which went into liquidation on 20 December 2019) on the condition that Steller Developments may not enforce any judgment against Mr Pitard or Steller Estate without the further leave of the Court: ACN 168 479 614 Pty Ltd (formerly known as Steller Developments Pty Ltd) (in liq) (Receivers & Managers Appointed) v Smedley, in the matter of ACN 168 479 614 Pty Ltd [2022] FCA 282. 6 The contest between Steller Developments and the active respondents concerns the proper construction of the 7 March 2017 Deed and, in the alternative, whether an order for its rectification ought be made. No issue has been taken - assuming that the 7 March 2017 Deed ought be construed or rectified in the manner for which Steller Developments contends - concerning events of default which have occurred, or as to the quantum of the claim. 7 Mr Vines has brought a cross-claim against Mr Smedley, Mr Cirelli and Mr Alastair Williams. The essence of that cross-claim is that, by dint of their entry into an agreement titled Retirement Agreement, each of Mr Smedley, Mr Cirelli and Mr Williams agreed to indemnify Mr Vines against any liability under any guarantee concerning the Steller group of companies, including any guarantee provided under the 7 March 2017 Deed.

B.1 Introduction 8 On 15 December 2016, each of the Guarantors executed a document titled "Deed of Guarantee" (15 December 2016 Deed) pursuant to which they, in broad terms, guaranteed the performance of obligations owed by SIN to repay funds invested by investors in return for notes issued by SIN. The guarantee was enforceable by the nominated "Manager", Steller Property Funds Pty Ltd. 9 On or about 2 February 2017, Steller Developments (defined as "the Issuer and the Guarantor") executed a document titled "Steller Commercial Loan Note Master Facility Deed" as a deed poll in favour of Atlas Advisors Australia Pty Ltd, as trustee for the QCAX Australian Property Income Fund II (defined as "the Investor"). 10 The Master Facility Deed provided the terms under which Atlas would subscribe for notes to be issued by Steller Developments. 11 The Master Facility Deed also included, at cl 11, a guarantee given by Steller Developments in favour of Atlas for the due and punctual payment by Steller Developments of the "Obligations", a term defined broadly in cl 11.5 of the Master Facility Deed and including the "Amount Owing" (which was defined in cl 1.1 of the Master Facility Deed as meaning "the amount determined by Atlas to be the aggregate of all money owing or payable by Steller Developments to Atlas under the Master Facility Deed…"). The Master Facility Deed did not refer to any other guarantee and in particular did not refer to the provision of any personal guarantee. 12 The Master Facility Deed also contained an "entire agreement" clause (21.7) and a "Master Terms" clause in the following terms: 21.8 Master terms 21.8.1 This Subscription Deed governs the Investor's subscription for Notes. It is executed as a deed poll in favour of the Investor. 21.8.2 The initial Notes issued under this Subscription Deed are linked to the commercial property assets identified in Schedule 1 and owned by the Issuer (or its associated entities). Further Notes may be issued by the Issuer and Guarantor from time to time and may be linked to other identified commercial property assets. Where this happens, the Issuer and Guarantor must provide the Investor with an updated Schedule 1 and Schedule 2. Each update to Schedule 1 and Schedule 2 is to be made in writing, dated and signed by the Issuer and Guarantor. Each update to Schedule 1 and Schedule 2 is taken to form part of this master Subscription Deed. 13 On 7 March 2017, as noted above, the Guarantors executed the 7 March 2017 Deed. The recitals to, and cll 1.1, 2 and 3 of, the 7 March 2017 Deed are in the following terms in so far as is presently relevant: Background A. The Investors have subscribed, and paid subscription monies, for Notes which have been issued by Steller Developments Pty Ltd (ACN 168 479 614) ("Issuer") under the terms set out in the Steller Commercial Loan Note Master Facility Deed. B. The Issuer will advance monies from time to time to companies forming part of, or associated with, the Steller Group Companies by way of loan and/or contributed as equity to any Steller Group Company for the purpose of funding property development projects. C. The Guarantors have agreed to guarantee the repayment of the Subscription Monies paid by Investors to the Issuer (plus any interest which accrues on the Notes but which is not paid by the Issuer in accordance with the Note Terms) from time to time on the terms set out in this Guarantee....

1. Definitions and interpretation 1.1 Definitions ... Information Memorandum means the information memorandum issued by the Issuer from time to time; Investor or Investors means a person that is the registered holder of a Note as recorded in the Note register maintained by the Issuer; Issuer means Steller Investment Notes Pty Ltd; ... Management Services Agreement means the management services agreement between the Issuer and the Manager dated 17th May 2016; Manager means Steller Developments Pty Ltd (ACN 168 479 614); Note means a note issued by the Issuer on the terms set out in the Information Memorandum; Note Terms means the terms and conditions applying to Notes as set out in the Information Memorandum; Respective Proportion means an amount determined by reference to all of the Loan Agreements on foot and the respective proportion of equity (determined by reference to the money or capital invested in the development) that each of Director Guarantor holds in the developments that are the subject of the Loan Agreements; Secured Money means: (a) the Subscription Monies; and (b) any interest which has accrued on the Subscription Monies in accordance with the Note Terms but which has not been paid; ... Subscription Monies means the monies received by the Issuer from Investors in consideration for the issue of Notes. ...
2. Guarantee (a) Each Guarantor guarantees the due and punctual payment of the Secured Money by the Issuer to the Investors. If the Issuer does not pay the Secured Money on time in accordance with the Note Terms then the Guarantors, jointly and severally, agree to pay the Secured Money to the Manager to distribute amongst the Investors in accordance with the terms of the Steller Commercial Loan Note Master Facility Deed within 10 Business Days of the Issuer receiving a written demand from the Manager which has been issued pursuant to a direction by the requisite majority of Investors as specified in the Note Terms. (b) The guarantee set out in clause 2(a) is provided for the benefit of all of the Investors and may only be enforced by the Manager in accordance with the Note Terms. Under no circumstances will the Guarantors be directly liable to any specific Investor or group of Investors. (c) Whilst the Guarantors are jointly and severally liable to the Manager, they each acknowledge that in the event that a Director Guarantor (Paying Party) pays all or some of the monies payable to the Investors in connection with the Note Terms, then each other Director Guarantor will be liable to the Paying Party to pay their Respective Proportion of the amount that the Paying Party paid to the Manager.
3. Nature of Guarantee 3.1 Nature of each Guarantors' obligation This Guarantee is given as a deed poll by each Guarantor jointly and severally for the benefit of the Manager and: (a) is a continuing obligation despite any intervening payment, settlement or other thing; (b) extends to all of the Secured Money; and (c) remains in full force until the Secured Money has been paid in full to the Investors. 3.2 Deed poll The Guarantors acknowledge that this deed may only be relied upon and enforced by the Manager in accordance with its terms, even though the Manager is not a party to it, but cannot be relied upon and enforced by any individual Investor or group of Investors. 3.3 Consideration The Guarantors enter into this deed for valuable consideration which includes the Investors subscribing for Notes issued by the Issuer, and the Issuer agreeing to advance funds to Steller Group Companies at their request. 3.4 Principal obligation This Guarantee is a principal obligation and will not be treated as ancillary or collateral to any other obligation. 14 In this proceeding, Steller Developments seeks: A declaration that on the proper construction of the Guarantee: a. in clause 1.1 of the Guarantee: i. "Issuer" means Steller Developments Pty Ltd (ACN 168 479 614); ii. "Information Memorandum" means the Steller Commercial Loan Note Master Facility Deed dated 2 February 2017; and ... b. in clause 2(a) of the Guarantee, the words "which has been issued pursuant to a direction by the requisite majority of Investors as specified in the Note Terms" mean "which has been issued pursuant to a direction by the Investor". 15 In other words, Steller Developments contends that cl 2 of the 7 March 2017 Deed and some of its attendant definitions should be construed, or rectified, so as to have the following meaning:

B.2 Relevant principles 17 Steller Development contends, in summary, that the declaration it seeks overcomes obvious absurdities in the literal meaning of the text of the 7 March 2017 Deed in circumstances where it is self-evident what the objective intention of the Guarantors is to be taken to have been. 18 The principles relevant to the correction of obvious errors by the application of the principles of construction were restated by Steward J (Griffiths and Derrington JJ agreeing) in Federal Commissioner of Taxation v Trustee for the Michael Hayes Family Trust [2019] FCAFC 226; (2019) 273 FCR 567 at 583 to 585 ([34] to [38]): 34 The correction of obvious errors by an application of the ordinary principles of construction is well known. As Dixon CJ and Fullagar J said in Fitzgerald v Masters (1956) 95 CLR 420 at 426-427: Words may generally be supplied, omitted or corrected, in an instrument, where it is clearly necessary in order to avoid absurdity or inconsistency. In that case, the word "inconsistent" was read as meaning "consistent" in a contract for sale. 35 The principle is premised on absurdity and not ambiguity. Indeed, it is applicable even where the language is unambiguous: National Australia Bank Ltd v Clowes (2013) 8 BFRA 600 at [34]-[35] per Leeming JA, citing Westpac Banking Corporation v Tanzone Pty Ltd (2000) 9 BPR 17,521 at [21] per Priestley, Fitzgerald JJA and Foster AJA and Noon v Bondi Beach Astra Retirement Village Pty Ltd (2010) 15 BPR 28,221 at [46] per Giles JA (with whom Macfarlan JA agreed). 36 Once again, I turn to Leeming JA for the most recent expression of the principle. In Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (in liq) (2019) 99 NSWLR 317, his Honour said at [6]-[10]: Rectification by construction At common law, if the error is clear, and it is also clear what a reasonable person would have understood the parties to have meant, then the mistake may be corrected as a matter of construction. This is old law. Lord St Leonards said in Wilson v Wilson (1854) 5 HL Cas 40 at 66-67; 10 ER 811 at 822: Now it is a great mistake if it is supposed that even a Court of Law cannot correct a mistake, or error, on the face of an instrument: there is no magic in words. If you find a clear mistake, and it admits of no other construction, a Court of Law, as well as a Court of Equity, without impugning any doctrine about correcting those things which can only be shown by parol evidence to be mistakes - without, I say, going into those cases at all, both Courts of Law and of Equity may correct an obvious mistake on the face of an instrument without the slightest difficulty. Examples may be found in linguistic errors, such as "inconsistent" being read as "consistent" in Fitzgerald v Masters (1956) 95 CLR 420; [1956] HCA 53, or conceptual errors, such as "lessor" being read as "lessee" in McHugh Holdings Pty Ltd v Newtown Colonial Hotel Pty Ltd (2008) 73 NSWLR 53; [2008] NSWSC 542. The language of a contract is not read like a computer program, such that any slip is fatal. Two conditions are necessary in order to correct the contractual language in this manner: (a) that the literal meaning of the contractual words is an absurdity and (b) that it is self-evident what the objective intention is to be taken to have been: see Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 89 NSWLR 633; [2014] NSWCA 184 at [117]-[119], approving National Australia Bank Ltd v Clowes [2013] NSWCA 179; 8 BFRA 600, where it was stated at [34]: Where both those elements are present … ordinary processes of contractual construction displace an absurd literal meaning by a meaningful legal meaning. Likewise, in the United Kingdom, the court must be satisfied both as to the mistake and the nature of the correction: Pink Floyd Music Ltd v EMI Records Ltd [2010] EWCA Civ 1429; [2011] 1 WLR 770 at [21] (Lord Neuberger); Arnold v Britton [2015] AC 1619; [2015] UKSC 36 at [78] (Lord Hodge). The court must be satisfied of those matters to a high level of conviction. To use the language of Dixon CJ and Fullagar J in Fitzgerald v Masters at 426-427, it must be "clearly necessary in order to avoid absurdity or inconsistency". As this Court said in Miwa Pty Ltd v Siantan Properties Pte Ltd [2011] NSWCA 297 at [18], the test of absurdity is not easily satisfied. Any question of absurdity or inconsistency must be identified according to established principles, by reference to the text of the agreement as understood in its factual and legal context: Wyllie v Tarrison Pty Ltd [2007] NSWCA 184 at [46]; Newey v Westpac Banking Corporation [2014] NSWCA 319 at [85]. Courts which are asked to delete, insert or rewrite part of a contract because of what is said to be an obvious error should bear steadily in mind that imperfections and infelicities and ambiguities in contractual language commonly reflect the give and take of negotiations, or the parties' appreciation that some obscurities are incapable of resolution. As Lord Hoffmann explained, the court does "not readily accept that people have made mistakes in formal documents": Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101; [2009] UKHL 38 at [23]. 37 I note the expression of the test as involving two conditions which must be satisfied, namely: (1) that the literal meaning of the contractual words is an absurdity; and (2) that it is self-evident what the objective intention is to be taken to have been. The level of satisfaction about these matters must be "high". 38 See also Perpetual Ltd v Myer Pty Ltd [2019] VSCA 98 at [122]-[127] per Whelan, Niall and Hargrave JJA and Tokio Marine & Nichido Fire Insurance Company Ltd v Holgersson [2019] WASCA 114 at [77] per Buss P, Beech and Pritchard JJA. 19 More recently, and to similar effect are decisions of the Court of Appeal of the Supreme Court of New South Wales in: James Adam Pty Ltd v Fobeza Pty Ltd [2020] NSWCA 311; (2020) 103 NSWLR 850 (Leeming JA; Bell P and Macfarlan JA agreeing, save as to the use of the descriptor "rectification by construction"); HDI Global Specialty SE v Wonkana No 3 Pty Ltd [2020] NSWCA 296; (2020) 104 NSWLR 634 (Bathurst CJ, Bell P, Meagher JA, Hammerschlag and Ball JJ); and Zhong v Guan [2024] NSWCA 300 at [23] to [38] (Kirk JA; Payne JA and Price AJA agreeing). 20 In HDI Global, Meagher JA and Ball J explained at 645 to 646 ([48] to [53]): Correcting the language by construction 48 It is an ordinary feature of human communication that what a person means may be obvious even though what they write or say, taken literally, is nonsense, or means the opposite. Contracts are not an ordinary mode of human communication, and courts do not "readily accept" that mistakes have been made in the drafting of a formal document: Chartbrook Ltd v Persimmon Homes Ltd [2009] 1 AC 1101; [2009] UKHL 38 at [23] (Lord Hoffmann). But contracts are nevertheless to be read on the basis that their drafters will on occasion fail to express correctly what they intend to say. The "correction" of mistakes by interpretation is therefore an aspect of "the single task of interpreting the agreement … in order to get as close as possible to the meaning which the parties intended": KPMG LLP v Network Rail Infrastructure Ltd [2007] Bus LR 1336; [2007] EWCA Civ 363 at [50] (Carnwath LJ); Chartbrook at [23]. 49 As the exercise is one of construction, the "meaning which the parties intended" can only be ascertained objectively, in accordance with the principles summarised earlier in these reasons. Construing a written agreement in accordance with those principles may reveal that its literal meaning is quite different from the meaning it was intended to bear. The latter is to prevail. As Lord St Leonards observed in Wilson v Wilson (1854) 10 ER 811 at 823; 5 HL Cas 40 at 70, construing an indemnity in favour of John Wilson for the debts of "John", in a separation agreement between John and Mary Wilson: "Then has the Court a power to rectify the error without doing any violence to the words? because I entirely reject any intention of putting violence upon words. We are bound as a Court of Justice to put a rational construction upon words, and to give to every word its proper sense. I do not think that I am breaking in upon any rule in advising your Lordships to consider 'John' as erroneously inserted, as it clearly appears by the context to have been, instead of 'Mary,' and by so considering it to make that part compatible with the rest, and thus give effect to what was the clear intention of the parties." 50 The application of this principle is ordinarily dependent on the satisfaction of two criteria: that the literal meaning of the language of the agreement is absurd; and that it is clear what the parties' objective intention "is to be taken to have been": Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (in liq) (2019) 99 NSWLR 317; [2019] NSWCA 11 at [8]. Substantially the same approach has been adopted in England: see Brightman LJ's formulation of the two conditions in East v Pantiles, and the qualifications subject to which those conditions are to be understood, as explained in KPMG v Network Rail and summarised in Chartbrook at [22]-[24]; and the discussion in Mainteck Services Pty Ltd v Stein Heurtey SA (2015) 89 NSWLR 633; [2014] NSWCA 184 at [119]-[120] (Leeming JA). Three points should be made about the criteria which must be satisfied. 51 First, "absurdity or inconsistency" may not strictly be required: cf Fitzgerald v Masters (1956) 95 CLR 420 at 426-427; [1956] HCA 53 (Dixon CJ and Fullagar J). The reasons of the plurality in Fitzgerald v Masters made no reference to such a requirement, treating the problem simply as one of the discernment of the parties' intention from the whole of the agreement, while earlier authorities referred only to the presence of a "palpable" or "obvious" mistake: Bache v Proctor (1780) 99 ER 247 at 247; 1 Doug 382 at 384 (Buller J); Wilson v Wilson at ER 822, 823; HL Cas 66, 70 (Lord St Leonards). There is accordingly much to be said for the modern English position, which requires a "clear" mistake: Pink Floyd Music Ltd v EMI Records Ltd [2010] EWCA Civ 1429 at [21] (Lord Neuberger MR; Laws and Carnwath LJJ agreeing on that point). In any event, if absurdity is required, "something opposed to reason" will suffice: Miwa Pty Ltd v Siantan Properties Pte Ltd [2011] NSW ConvR 56-289; [2011] NSWCA 297 at [13] (Basten JA; McColl and Campbell JJA agreeing). 52 Secondly, satisfaction of the first criterion follows from satisfaction of the second. Where it is clear that the literal meaning of contractual language is inconsistent with the parties' objective intention discerned from the agreement as a whole, there is a clear mistake, and likely also absurdity in the relevant sense. What the first criterion reflects is that a court will not lightly conclude that "imperfections and infelicities and ambiguities" in the language of an agreement reflect a mistake, rather than the give and take of commercial negotiation: Seymour Whyte at [10], citing Chartbrook at [23]. 53 Finally, the application of those criteria should not obscure the fact that the question remains one of the ascertainment of the parties' objective intention through the application of ordinary principles of construction. That is not to say that the two criteria need not be satisfied. It is rather to emphasise that they are merely steps involved in reasoning to a conclusion that by one word or phrase the parties meant something else. 21 Thus, in summary, the Court is required to ascertain the parties' objective intention using the ordinary principles of construction; and the Court may construe an instrument so as to correct an absurdity in the literal meaning of the words used where it is self-evident what the objective intention is to be taken to have been. 22 As to the requirement that the objective intention be self-evident, Leeming JA in James Adam explained at 866 to 867 ([62] to [64]): Cases where there is a binary choice and cases where there are many possibilities 62 A common class of case is where there are precisely two possibilities, and the wrong one has been recorded in the instrument. The decisions mentioned above fall into that class. When "John" was read as "Mary" in Wilson v Wilson, when "inconsistent" was read as "consistent" in Fitzgerald v Masters, and when "lessor" was read as "lessee" in McHugh Holdings Pty Ltd v Newtown Colonial Hotel Pty Ltd (2008) 73 NSWLR 53; [2008] NSWSC 542, the absurdity or inconsistency was obvious, and so too was what had been intended. The only people with debts to be indemnified in the separation deed were the husband John and the wife Mary. The confusion between "inconsistent" and "consistent", and between "lessor" and "lessee" is similarly binary. Similarly, the "palpable mistake" mentioned by Buller J in Bache v Proctor (1780) 1 Doug 382 at 384; 99 ER 247 at 247 where a bond provided that it should be void if the obligor did not pay was readily cured by deleting the word "not". 63 In contrast, even where it is clear that something has gone awry, construction is to no avail if it is unclear how the absurdity or inconsistency should be resolved. In Energy World Corporation Ltd v Maurice Hayes & Associates Pty Ltd (2007) 239 ALR 457; [2007] FCAFC 34, a Full Court of the Federal Court (Moore, Tamberlin and Gyles JJ) allowed an appeal on this point, saying at [11]: "[11] It may be accepted that the word 'lesser' gives no practical content to the words 'or the Term (as extended or renewed) is not renewed'. In that sense, it may be said that there is an inconsistency. However, the terms of cl 8.6 do not enable a conclusion to be drawn as to how the inconsistency should be resolved. It could be cured just as easily by omitting the words 'or the Term (as extended or renewed) is not renewed' as by substituting 'greater' for 'lesser'. Put another way, the terms of the clause do not enable the conclusion to be drawn that the contractual intention was to provide the Consultant with a termination payment of a minimum of six months on non-renewal of the term. The principle of construction in question does not enable a court to speculate as to the proper resolution of the inconsistency." 64 That paragraph was also endorsed by the Victorian Court of Appeal in Perpetual Ltd v Myer Pty Ltd at [124] and [146]. 23 The limits of the power of the Court to correct an error by construction must be borne in mind. As the Full Court of this Court noted in Energy World Corporation Ltd v Maurice Hayes & Associates Pty Ltd [2007] FCAFC 34; (2007) 239 ALR 457 at 460 [11] (Moore, Tamberlin and Gyles JJ), in the passage extracted in the previous paragraph, construction of instruments so as to resolve obvious errors does not enable the Court to engage in speculation as to the common intention of the contracting parties. In QBT Pty Ltd v Wilson [2024] NSWCA 114, Leeming JA (Bell CJ and Ward P agreeing) explained at [73] to [74]: 73 Sometimes obvious errors in written contracts can be resolved by construction. But there are limits to courts' powers to do so. It is necessary not merely to identify the obvious error, but also to be clear how the absurdity is to be resolved. It must be "self-evident what the objective intention is to be taken to have been": Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (in liq) (2019) 99 NSWLR 317; [2019] NSWCA 11 at [8]. As was said by Latham CJ in Tatham v Huxtable (1950) 81 CLR 639 at 645; [1950] HCA 56, applying the principle to a will: It often happens, however, that the misuse of some word or phrase is so palpable on the face of the will, as that no difficulty occurs in pronouncing the testator to have employed an expression which does not accurately convey his meaning. But this is not enough: it must be apparent, not only that he has used the wrong word or phrase, but also what is the right one; and, if this be clear, the alteration of language is warranted by the established principles of construction. 74 Sometimes a court may be confident that the literal meaning contains an absurd mistake, but cannot be confident of what the parties are to be taken to have intended in that eventuality. James Adam Pty Ltd v Fobeza Pty Ltd (2020) 103 NSWLR 850; [2020] NSWCA 311 is one example, and others are given at [63]-[65] of that decision. If it is unclear how the absurdity is to be resolved, then the principles of construction where there is an obvious error are not available to authorise a departure from the ordinary literal meaning.

B.3 Construction of the 7 March 2017 Deed 24 I turn now to the construction of the 7 March 2017 Deed. 25 As Gageler CJ, Gordon, Edelman, Gleeson and Beech-Jones JJ recently stated in Elisha v Vision Australia Ltd [2024] HCA 50; (2024) 99 ALJR 171 at 181 [38], the meaning of any contractual term: … "is to be determined by what a reasonable person would have understood [the terms] to mean". This requires consideration of the common intention of the parties by reference to the object and text of the provision as well as the surrounding circumstances. The common intention of the parties is "to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement". (citations omitted) 26 The hearing proceeded on the basis that the Master Facility Deed was to be taken into account in construing the 7 March 2017 Deed. However, there was no concession that these deeds formed part of one transaction and, for the reasons developed below, I am not satisfied that they did. 27 The salient terms of the 7 March 2017 Deed and the Master Facility Agreement are described at [10] to [13] above. References below to clauses are to clauses of the 7 March 2017 Deed, unless otherwise indicated. 28 A reasonable person would construe the 7 March 2017 Deed, and in particular cll 2 and 3 as follows. 29 The first sentence of cl 2(a) is a statement in general terms of a guarantee given by the Guarantors of the due and punctual payment by the "Issuer" of the "Secured Money" to the "Investors". When it is read with the definitions in cl 1.1 of the 7 March 2017 Deed of "Investors", "Issuer" and "Secured Money" and the definitions of the defined terms used within those definitions it conveys that the Guarantors guarantee the due and punctual repayment by SIN of monies received by SIN from persons recorded in a note register maintained by SIN as the registered holder of notes issued by SIN on the terms set out in an information memorandum issued by SIN in consideration for the issue of such notes, together with interest thereon. 30 The second sentence of cl 2(a) sets out how the guarantee given by the Guarantors is to operate. When it is read with the definitions in cl 1.1 of "Issuer", "Secured Money", "Note Terms", "Manager" and "Investors", and the definitions of the defined terms used within those definitions it contemplates, chronologically: (1) a failure by SIN to repay on time and in accordance with the terms and conditions set out in the information memorandum issued by SIN, monies and interest it received from the registered noteholders; (2) a written demand from Steller Developments, as Manager, to SIN, which demand has been issued pursuant to a direction by the requisite majority of registered noteholders as specified in the terms set out in an information memorandum issued by SIN; (3) within 10 business days of the receipt by SIN of the written demand, payment by the Guarantors to Steller Developments of an amount representing the monies received by SIN from the registered noteholders in consideration for the issue of the notes, together with interest thereon; and (4) such payment being made to enable SIN to distribute it among the registered noteholders in accordance with the terms of the Master Facility Deed. 31 Clause 2(b) serves three functions. First, it provides that the guarantee the subject of cl (2)(a) enures to the benefit of all of the "Investors". Secondly, taking into account the definitions of "Manager" and "Note Terms", it provides that the guarantee the subject of cl (2)(a) may only be enforced by Steller Developments as Manager and only in accordance with the terms and conditions applying to notes issued by SIN on the terms and conditions set out in an information memorandum issued by SIN. Thirdly, it provides that the Guarantors will not be directly liable to any specific registered noteholder or group of registered noteholders. 32 Clause 2(c), when read with the definitions of "Manager" and "Respective Proportion", provides a means of ensuring equity of contributions as between the Guarantors. 33 Clause 3.1 when read with the definitions of "Manager", "Secured Money" and "Investors", provides that the guarantee is a joint and several guarantee for the benefit of Steller Developments as Manager extending to all of the monies owed by SIN to the registered noteholders and remains in force until all of that money has been repaid in full to the registered noteholders. 34 Clause 3.2 when read with the definition of "Manager", is an acknowledgement by the Guarantors that Steller Developments (as Manager), although not a party to the 7 March 2017 Deed may enforce that deed "in accordance with its terms". It also reiterates the third function of cl 2(b), stating that the 7 March 2017 Deed cannot be relied upon and enforced by any individual registered noteholder or group of registered noteholders. 35 Thus, taking the salient operative provisions of the 7 March 2017 Deed as a whole, they set out the terms of a guarantee: (1) given by the Guarantors in favour of those persons who become registered holders of notes issued by SIN; (2) of the performance of SIN's obligation to repay the monies subscribed by those registered noteholders for the notes, together with interest; and (3) enforceable by Steller Developments as Manager. 36 The reference in the second sentence of cl 2(a) to the distribution of funds to "Investors" in accordance with the Master Facility Deed is curious in circumstances where: (1) the 7 March 2017 Deed otherwise provides that "Investors" are those persons recorded in a note register maintained by SIN as the registered holder of notes issued by SIN on the terms set out in an information memorandum issued by SIN; and (2) the operative provisions of the 7 March 2017 Deed make no other reference to the Master Facility Deed. 37 Although it is apparent that there is a curiosity in the text of the 7 March 2017 Deed, the questions for determination are: whether the Court ought be satisfied of the existence of absurdities in the literal meaning of the words used; and whether what the objective intention should be taken to have been is self-evident. 38 I turn now to the three absurdities for which Steller Developments contends.

B.3.1 First contended absurdity - the definition of "Issuer" 39 The first contended absurdity concerns the definition of "Issuer". As noted above, that term is defined in cl 1.1 of the 7 March 2017 Deed to mean SIN. Steller Developments contends that SIN should be replaced by Steller Developments. 40 Steller Developments submitted that: (1) first: (a) it is plain from the Master Facility Deed that the only entity issuing notes and receiving monies under that instrument is Steller Developments; (b) thus it is absurd that a failure by SIN to repay the Secured Money is an integer of the guarantee given under the 7 March 2017 Deed when SIN was not entitled to receive money or issue notes under the Master Facility Deed; (2) secondly, reading the "Issuer" as a reference to SIN is in direct conflict with the definition of "Issuer" in recital A to the 7 March 2017 Deed (see [13] above). When taken with the first consideration, this supports the view that an obvious mistake has been made in the definition of the Issuer in cl 1.1, and that "the Issuer" should be a reference to Steller Developments and not SIN; and (3) in any event, it is self-evident that the "Issuer" was intended to be "Steller Developments". 41 I do not accept this submission. Although the only entity issuing notes and receiving monies under the Master Facility Agreement is Steller Developments, it does not follow that there is an absurdity in the 7 March 2017 Deed. In particular, I do not accept that the underlying premise that the 7 March 2017 Deed was objectively intended by the Guarantors to operate as a guarantee of obligations under the Master Facility Deed when: (1) as set out at above, the provisions of the 7 March 2017 Deed (save perhaps as to the distribution of funds in accordance with the second sentence of cl 2(a)) are capable of operating as a guarantee in respect of the obligations of SIN with respect to notes issued under an information memorandum; and (2) the Master Facility Deed does not contemplate the provision of any personal guarantees, but expressly contemplates the provision of a guarantee from Steller Developments, the named "Guarantor" in the Master Facility Deed. 42 There is tension between: (1) the reference in recital A to Steller Developments as the "Issuer"; and (2) the definition in cl 1.1 of the operative provisions to SIN as the "Issuer". However that tension is to be resolved by giving primacy to the unambiguous definition in the operative provisions. No absurdity arises. 43 Further, it is far from self-evident that the Guarantors objectively intended the "Issuer" to be "Steller Developments" when a conclusion that is at least equally available is that the reference in cl 2(a) (and recital A) of the 7 March 2017 Deed to the Master Facility Deed was mistaken and that the true intention, consistent with the remainder of the 7 March 2017 Deed (and with the approach taken in the 15 December 2016 Deed) was that those references were intended to be to the "Information Memorandum" as defined (see [13] above).

B.3.2 Second contended absurdity - definition of "Information Memorandum" 44 The second contended absurdity concerns the definition of "Information Memorandum". As noted above, that term is defined in cl 1.1 of the 7 March 2017 Deed to mean "the information memorandum issued by the Issuer from time to time". 45 Steller Developments contends in effect that this phrase should be replaced with a reference to the Master Facility Deed. 46 Steller Developments acknowledged that the definitions of "Secured Money" and "Note Terms" in cl 1.1 of the 7 March 2017 Deed, when traced through the attendant definitions, ultimately rested upon the expression "Information Memorandum", which is defined to mean "the information memorandum issued by the Issuer from time to time". 47 Steller Developments then submitted that: (1) there was no need for an information memorandum and there was in fact no information memorandum for the notes issued by Steller Developments to Atlas pursuant to the Master Facility Deed; (2) the difficulty this presents is readily resolved when regard is had to cll 21.7 and 21.8 of the Master Facility Deed (see [12] above); (3) clause 21.8.1 of the Master Facility Deed makes clear that the terms of the notes issued pursuant to the Master Facility Deed are set out in that deed only and does not contemplate the existence of other terms and conditions (whether in an information memorandum or elsewhere). This is reinforced by the entire agreement clause in cl 21.7 of the Master Facility Deed; (4) there is no doubt that that the 7 March 2017 Deed was given to secure the obligations under the Master Facility Deed, since that instrument is referred to in cl 2(a) and recital A; (5) it is also relevant there were no other facilities being negotiated or documented in March 2017 when the 7 March 2017 Deed was prepared and signed; and (6) in those circumstances, the Court would conclude that there is an absurdity on the face of the 7 March 2017 Deed which may be resolved by construing "Information Memorandum" as referring to the Master Facility Deed. 48 I do not accept these submissions. Again, they rest on the premise - which I have rejected - that the 7 March 2017 Deed was objectively intended by the Guarantors to operate as a guarantee of obligations under the Master Facility Deed. 49 Further, the evidence does not establish that all of the Guarantors were aware at the time of entry into the 7 March 2017 Deed that: (1) there was in fact no information memorandum for notes issued by Steller Developments to Atlas pursuant to the Master Facility Deed (or that such notes were issued); or (2) there were no other facilities being negotiated or documented when the 7 March 2017 Deed was prepared and signed. 50 Finally, the proposition that the expression "Information Memorandum" should be construed as meaning the Master Facility Deed rather than "the information memorandum issued by [SIN] from time to time" is far from self-evident, for the reasons set out at [43] above.

B.3.3 Third contended absurdity - direction by majority investors 51 The third contended absurdity concerns the words "a direction by the requisite majority of Investors as specified in the Note Terms" in the second sentence of cl 2(a). As noted above "Investors" are defined as persons that are the registered holders of Notes as recorded in the Note register maintained by the Issuer and "Note Terms" are defined as the terms and conditions applying to Notes as set out in the Information Memorandum. "Note" is defined as a note issued by the Issuer on the terms set out in the Information Memorandum and "Information Memorandum" is defined as the information memorandum issued by the Issuer from time to time. 52 Steller Developments acknowledged that even if the definition of "Information Memorandum" were to be corrected in the manner proposed, a further difficulty would arise because the Master Facility Deed contains no mechanism for a direction from the requisite majority of investors (there being only one investor under the Master Facility Deed). Steller Developments then submitted that: (1) the reference to "a direction by the requisite majority of Investors as specified in the Note Terms" originates from the 15 December 2016 Deed (and another deed of guarantee executed on that day by Steller Developments, which I do not take into account as I am not satisfied that this was a matter known to all of the Guarantors); (2) it is obvious that the phrase was permitted to remain in the 7 March 2017 Deed by an oversight and it is appropriate that that error is corrected by disregarding the reference to a "requisite majority"; (3) the Court may adopt that approach as a matter of construction where: (a) the Master Facility Deed - which is expressly referred to in cl 2(a) and recital A of the 7 March 2017 Deed - makes plain that the reference to "Investors" is intended to refer to the Investor under the Master Facility Deed; (b) the terms of the Master Facility Deed refer throughout to "the Investor" (being Atlas) and provide no mechanism for the accession of additional investors; (c) there is thus no mechanism, and no need for a mechanism, under the Master Facility Deed for the giving of a direction from a majority of investors; and (d) when construing a document, a court may reject whole words or provisions where satisfied that they are inconsistent with the parties' intentions. 53 I do not accept these submissions, which again rest on the rejected premise that the 7 March 2017 Deed was objectively intended by the Guarantors to operate as a guarantee of obligations under the Master Facility Deed. 54 Further, it is not apparent that the phrase "a direction by the requisite majority of Investors as specified in the Note Terms" gives rise to any absurdity. When regard is had to the definitions of "Investors", "Note Terms" and "Information Memorandum", and particularly the contemplated investment in notes under an information memorandum or information memoranda, it is clear that multiple investors were contemplated. 55 It is also far from obvious that the phrase "a direction by the requisite majority of Investors as specified in the Note Terms" was used in the 7 March 2017 Deed by dint of an oversight. There is also no evidence suggesting that each of the Guarantors had knowledge of the drafting process employed to produce the 7 March 2017 Deed. 56 I also do not accept that 7 March 2017 Deed makes it plain that the reference to "Investors" is intended to refer to the "Investor" under the Master Facility Deed, for the reasons addressed at [43] above. 57 Finally, it is far from self-evident that the Guarantors' objective intention was that the direction be issued by Atlas as a lone investor, rather than the "requisite majority of Investors as specified in the Note Terms".

B.4 Conclusions on construction 58 I am not satisfied that, properly construed, the 7 March 2017 Deed contains any of the absurdities suggested by Steller Developments, or that it is self-evident that the objective intention should be taken to have been the construction for which Steller Developments contends. 59 In particular, although the text of the 7 March 2017 Deed does contain some drafting curiosities it is far from self-evident that the Guarantors' objective intention was to provide a personal guarantee of the obligations of Steller Developments under the Master Facility Deed, particularly when another construction that is well open is that the references to the Master Facility Deed are erroneous and that this was intended to be a reference to information memoranda issued by SIN. Other constructions may be available. 60 To reach a conclusion that the Guarantors' intention was to provide a personal guarantee to Steller Developments with respect to notes issued under the Master Facility Deed would be to engage in impermissible speculation (see Energy World at 460 [11]) and to travel well beyond the limits of the Court's powers to resolve errors by construction (see QBT at [73] and [74]). 61 The absence of a self-evident answer to the question: "what was the Guarantors' objective intention?" is fatal to the construction case brought by Steller Developments.

C. THE RECTIFICATION CASE 62 I turn now to the rectification case. Steller Developments seeks: 2. In the alternative to prayer 1: a. a declaration that at the time of executing the Guarantee, it was the common intention of each of the Guarantors jointly and severally to guarantee the obligations of the issuer of the notes to Atlas in consideration for the subscription monies paid by Atlas from time to time pursuant to the Master Facility Deed; b. the Guarantee be rectified to give effect to the common intention of the Guarantors by: i. in clause 1.1 of the Guarantee:

1. amending the definition of "Issuer" to read "Steller Developments Pty Ltd (ACN 168 479 614)";
2. amending the definition of "Information Memorandum" to read "Steller Commercial Loan Note Master Facility Deed dated 2 February 2017"; and ... ii. in clause 2(a) of the Guarantee, substituting the words "which has been issued pursuant to a direction by the requisite majority of Investors as specified in the Note Terms" with "which has been issued pursuant to a direction by the Investor". c. an order that a copy of these orders be endorsed on the Guarantee. 63 The rectification case as ultimately advanced by senior counsel for Steller Developments involved the propositions that: (1) the 7 March 2017 Deed was signed by the Guarantors; and (2) the Court ought infer that the Guarantors intended the 7 March 2017 Deed they signed effectually to guarantee the obligations under the facility which it purports to guarantee, namely the Master Facility Deed. 64 Such an inference, if drawn, would not provide a basis for rectification. Rectification is an equitable remedy which is available upon proof of a prior common intention of the parties to an instrument, which intention was continuing at the time of the execution of the instrument, but which, through a common mistake, was not reflected in the instrument as executed: see, e.g, Seymour White at 323 [12]. 65 The submissions made on behalf of Steller Developments do not address any prior common intention of the Guarantors that was not reflected in the 7 March 2017 Deed; and instead rely upon the terms of the 7 March 2017 Deed itself. There is no reason to infer that each of the Guarantors had a subjective intention which differs from the objectively determined construction of the 7 March 2017 Deed set out at [28] to [37] above. On this basis, the 7 March 2017 Deed is a correct record of the Guarantors' common intention, a proposition directly contrary to the position which must obtain if rectification is to be available. 66 In any event, I am not prepared to infer that there was a common objective intention of the Guarantors to guarantee the performance of Steller Developments under the Master Facility Deed, for the reasons set out above with respect to the construction case.

D. THE CROSS-CLAIM 67 By his cross-claim, Mr Vines seeks an order that Mr Smedley, Mr Cirelli and Mr Williams indemnify him in respect of Steller Development's claims against him. That order is sought in reliance upon the Retirement Agreement, which Mr Vines, Mr Smedley, Mr Pitard, Mr Cirelli and Mr Williams signed on 27 April 2018. In view of the conclusions that I have reached on the principal claim, Mr Vines is not liable to Steller Developments under the 7 March 2017 Deed, and thus he requires no indemnification. Nevertheless, I address the cross-claim below.

D.1 Findings of fact 68 From the evidence relevant to the cross-claim - and in particular unchallenged evidence of Mr Vines and Mr Williams and contemporaneous documents - I make the following findings of fact. 69 By 25 April 2018, Mr Vines had prepared and placed his electronic signature upon a document in the following form (Authority): AUTHORITY TO: Sargeants Port Phillip Pty Ltd P.O. BOX 6789 St Kilda Road Central Melbourne 8008 Steller 57 Pty Ltd: Sale of Lots G09, G11, 103 & 108, 110-114 Mimosa Road, Carnegie I irrevocably request and direct that upon settlement of the sale of each of the above Lots the net proceeds of sale be applied by you as follows:

1. as to 50% towards payments to be made to me or to whom I may direct you in writing up to the total amount of $1,158,066*
2. as to the other 50% and any remaining proceeds after the amount in paragraph 1 above has been paid in full, to Steller Projects Pty Ltd. Dated 2018 [Mr Vines's signature] *Please note: amount subject to final sales price of G09, G11, 103 & 108. 70 Sargeants Port Phillip Pty Ltd was a conveyancer that the Steller group of companies often engaged on its projects. 71 On 27 April 2018, Mr Vines, Mr Smedley, Mr Pitard, Mr Cirelli, Mr Vines and Mr Williams signed the Retirement Agreement. The salient terms of the Retirement Agreement include:
3. Interpretation 1.1 Definitions In this document the following words and phrases have the following meaning: ... Group means the Steller Group of Companies and Unit Trusts, but does not include the Equity Holders. Parties means the persons named as the parties to this document. Retirement means the Retirement of Thomas David Vines from the Group in the manner contemplated by this document. Retirement date means 26 March 2018. ... TDV means Thomas David Vines, and includes where applicable TDV Builders Pty Ltd ATF Thomas Vines Family Trust and T&S Vines Pty Ltd ATF The Vines Superannuation Fund. ...
4. The Retirement (a) The Retirement will occur on the Retirement Date. (b) The Parties shall implement the Retirement and each element of the Retirement in the manner provided for in Schedule 1: (i) for the values and total value to be received by TDV, partly in cash and partly in specie, as are set out in Schedule 1, Schedule 2 and Schedule 3; (ii) as at the Retirement Date; and (iii) to the extent that any actions, payments or other items are not completed on the Retirement Date as soon as practicable after the Retirement Date. (c) Without limiting Schedule 1, Schedule 2 or Schedule 3, on the Retirement Date, and subject to the implementation of the Retirement: (i) TDV will retire as a director, secretary or office holder in all entities in the Group (including the Equity Holders Agreements) other than Steller 49 Pty Ltd and the Steller 49 Trust and Steller 57 Pty Ltd and the Steller 57 Trust, and Steller Investments Pty Ltd and the Steller Investments Trust; (ii) TDV will cease to have any shares or units or other equity in the remaining parts of the Group or any of its entities; (iii) TDV will cease to have any further role in the Business or any day to day affairs of the Group; and (iv) TDV will cease to be liable for any indebtedness of the remaining parts of the Group including as a guarantor. The other Parties will seek to have TDV released as a guarantor by the creditors concerned, but TDV acknowledges and agrees that this might not be possible in a reasonable time or at all, and in the meantime the other Parties jointly and severally will indemnity and hold harmless TDV against any liability under any guarantee concerning the Group. (d) The Parties shall promptly cause the changes described in Schedule 4 and Schedule 5 and any other necessary changes omitted there to be carried out as at the Retirement Date. (e) If any act, payment or other event is to occur after the Retirement Date the Parties shall procure that it does occur as soon as practicable. (f) Subject to the implementation of the Retirement and completion of all other matters provided for in this document: (i) TDV shall release and discharge the other Parties and each entity comprising the Group (including the entities transferred to him or his entities) from all further liabilities accruing after the Retirement Date and agrees to indemnify them and hold them indemnified and held harmless accordingly; and (ii) the other Parties jointly and severally shall release and discharge TDV and each of his entities (including the entities transferred to him or his entities) from all further liabilities accruing after the Retirement Date and agrees to indemnify them and hold them indemnified and held harmless accordingly, and Without limiting the releases and indemnities under this clause 2(f), they apply in respect of any liability accruing after the Retirement Date in respect of any entity in the Group where TDV was a shareholder, unitholder, other equity holder or beneficiary, director or other officer, employee, agent or trustee. ... 11.3 Waiver and variation A provision of or a right created under this document may not be: (a) waived except in writing signed by the party granting the waiver; or (b) varied except in writing signed by the Parties. ... SCHEDULE 1 ... The items summarised in the Forecast Settlement Waterfall will be implemented on or as soon as practicable after the Retirement Date as follows. A reference to Valuation means a Valuation set out in the Waterfall.
5. Development Group ... (c) Cash payments to TDV: The cash payments to TDV (at the Signing Date totalling $2,622,303) will be financed as follows with the objective of completing this by 30 September 2018 subject to settling the sale of apartments in accordance with clause 1(c)(ii): (i) TDV will retain as assets of Steller 57 Pty Ltd Lots 109, 110 and 111 until the purpose provided for in clause 1(d) has been carried out, and thereafter TDV will be at liberty to deal with those Lots as he so determines in his capacity as appointor of the Steller 57 Trust; (ii) the Parties will procure that Lots G09, G11, 103 and 108 will be sold at the prices reasonably obtainable in the current market and that the net proceeds of sale will be applied as follows:
6. as to 50% towards the remaining cash payments to be made to TDV as described in schedule 1 under the heading "Cash Transfer - from Mimosa proceeds" (with at the Signing Date total $1,430,755); and
7. as to the other 50% and any remaining proceeds after TDV has been paid the cash payments due to TDV in full to Steller Projects Pty Ltd; and (iii) on the Signing Date TDV shall provide to the other Parties an irrevocable direction and authority addressed to the lawyers or conveyancers for the sale of these Lots to disburse the net proceeds of sale in the manner described above. (underline emphasis added) 72 Mr Vines does not now recall whether, and if so how, he provided a copy of the Authority to the other parties to the Retirement Deed (or to Sargeants), as required by cl 1(c)(iii) of Schedule 1 to the Retirement Agreement. 73 Mr Smedley in his affidavit evidence, denied having received the Authority. In cross‑examination, he accepted that he may have done so. Mr Cirelli and Mr Williams also accepted in cross-examination that they may have received the Authority. 74 On 17 May 2018, Sargeants was appointed as the conveyancer for the sale of lots G09, G11, 103 and 108. 75 Lots G09, G11, 103 and 108 were subsequently sold - as contemplated by cl 1(c)(ii) of Schedule 1 to the Retirement Agreement - and the proceeds of sale were distributed. 76 The distribution of the proceeds of sale of those lots was managed by Mr Williams on behalf of the Steller Group. Mr Vines allowed this to occur because he understood that that was the process contemplated and required by the Retirement Agreement. Mr Williams and Ms Lauren Collins (an accountant working under the supervision of Mr Williams) directed Sargeants as to how the proceeds of sale of lots G09, G11, 103 and 108 were to be distributed and those instructions were followed. 77 Of particular relevance to the determination of the cross-claim is the distribution of the proceeds of sale of lot 103. For that lot: (1) on 10 May 2019, Mr Williams sent an email to Ms Collins and Ms Rachel Wat (Mr Williams's executive assistant) concerning the distribution of the proceeds of sale of lot 103, which included: Can our cash go direct to Ninety Mile Beach cash account please. Rachel, Can you please provide bank details. (by "our cash", Mr Williams was referring to the amount due to Steller Projects); (2) Ms Wat replied to Mr Williams and Ms Collins providing bank account details for Ninety Mile Beach Pty Ltd; (3) on 13 May 2019, the sale was settled; (4) on 24 June 2019, Sargeants reported on that settlement. Their letter included: At the settlement the sum of $675,679.99 was received from the purchaser. This was disbursed as follows: …
8. Amount to Ninety Mile Beach: $471,282.17 ; and (5) a balance sheet for Steller Projects as at 30 June 2019 included an entry for a loan from Stellar Projects to Ninety Mile Beach in the amount of $471,282.17. 78 At no time during the process of selling lots G09, G11, 103 and 108, did Sargeants, Mr Williams or anyone else say to Mr Vines that those units could not be sold, or that the sales process had been affected in any way, because Mr Vines had not provided an irrevocable authority. 79 Subject to two matters which are discussed at [83] to [86] below, there is no issue that the steps contemplated by Schedule 1 to the Retirement Agreement have been carried out, including: (1) Mr Vines ceasing his involvement in the Steller group of companies; (2) the sale of lots G09, G11, 103 and 108 and the distribution of the proceeds of those sales; and (3) Mr Vines receiving a total of $6.53 million.

D.2 Consideration 80 Mr Vines's principal case on the cross-claim is a claim in contract based upon cl 2 (c)(iv) of the Retirement Agreement. He contends that the Retirement has been implemented as required by the chapeau to cl 2(c) and as such he is entitled to be indemnified by Mr Smedley, Mr Cirelli and Mr Williams. There is no issue that Steller Developments was part of the Steller group of companies or that any liability that Mr Vines may have under the 7 March 2017 Deed would be a liability under a guarantee concerning that group. 81 Mr Cirelli admitted that Mr Vines retired from the Steller group of companies in accordance with the terms of the Retirement Agreement. 82 Mr Smedley and Mr Williams contend that the Retirement has not been implemented within the meaning of cl 2(c) of the Retirement Agreement, for two reasons. 83 The first concerns whether on the "Signing Date", Mr Vines provided to Mr Smedley, Mr Pitard, Mr Cirelli and Mr Williams "an irrevocable direction and authority addressed to the lawyers or conveyancers for the sale of these lots to disburse the net proceeds of sale in the manner described above" as required by cl 1(c)(iii) of Schedule 1 to the Retirement Agreement. 84 It is clear that the Authority was an irrevocable direction and authority addressed to the conveyancers for the sale of lots G09, G11, 103 and 108. At issue is whether it was provided to Mr Smedley, Mr Pitard, Mr Cirelli and Mr Williams on the "Signing Date". 85 I infer that the Authority was so provided, such an inference arising from: (1) the finalisation of the drafting of the Authority on 25 April 2018, shortly prior to the signing of the Retirement Agreement on 27 April 2018 (being the "Signing Date"); (2) the subsequent implementation of steps otherwise contemplated by Schedule 1; (3) the absence of any protest by any other party to the Retirement Agreement concerning a failure by Mr Vines to provide the required irrevocable direction and authority in a context in which steps otherwise contemplated by Schedule 1 to the Retirement Agreement were being implemented; and (4) the absence of a denial by each of Mr Smedley, Mr Cirelli and Mr Williams that the Authority had been received. 86 The second basis on which Mr Smedley and Mr Williams contend that the Retirement Agreement has not been implemented within the meaning of cl 2(c) of the Retirement Agreement concerns the payment with respect to lot 103 made to Ninety Mile Beach. Mr Smedley and Mr Williams contend that this payment ought to have been made to Steller Projects as required by cl 1(c)(ii)(2) of Schedule 1 to the Retirement Agreement and the fact that it was not so made has the consequence that the Retirement has not been implemented. I do not accept this submission. It is clear on the evidence that the payment to Ninety Mile Beach was made at the direction of Mr Williams, a director of Steller Projects, and for the benefit of Steller Projects, which recorded that payment as a loan made by it to Ninety Mile Beach. This is sufficient to establish that the net proceeds of sale of the sale of lot 103 were applied as a payment to Steller Projects. 87 Mr Cirelli and Williams relied upon two further arguments as to why Mr Vines is not entitled to an indemnity. These arguments were first raised in the defence to the cross-claim filed by Mr Smedley, however senior counsel for Mr Smedley indicated that Mr Smedley did not rely upon them. 88 The first of these arguments is that any right that Mr Vines had to an indemnity under cl 2(c)(iv) of the Retirement Agreement elapsed because it operated only for the period (i.e. "the meantime") in which the other parties to the Retirement Agreement sought to have Mr Vines released as a guarantor by various creditors. In other words, this clause only required Mr Smedley, Mr Cirelli and Mr Williams to use their "best endeavours" to obtain releases for the benefit of Mr Vines and if such endeavours were unsuccessful then no indemnity came into existence. This argument overlooks the effect of the first sentence of that clause which is an unqualified statement that Mr Vines would cease to be liable for any indebtedness of the Steller group of companies (save for those excluded in cl 2(c)(i)). In this context, the expression "in the meantime" means until a release has been obtained (thereby rendering the indemnity unnecessary). 89 The second of these arguments as pleaded is that the effect of cl 2(f)(i) of the Retirement Agreement was that Mr Vines released and indemnified Mr Williams and the other parties to the Retirement Agreement from any liability to him under cl 2(c)(iv) of the Retirement Agreement. How this argument is intended to work is not clear. It was not developed in written or oral submissions and need not be considered further. 90 Thus, I am satisfied that Mr Vines has made out his contractual case. It is unnecessary to consider Mr Vines's alternative cases based upon waiver and estoppel by convention. 91 It follows that Mr Vines is entitled to an indemnity in accordance with cl 2(c)(iv) of the Retirement Agreement, with the consequence that had I found in favour of Steller Developments against Mr Vines on the principal claim, then I would have also found that Mr Vines was entitled to succeed on his cross-claim against Mr Smedley, Mr Cirelli and Mr Williams.

E. CONCLUSION 92 For the reasons set out above, the principal claim should be dismissed. Had the principal claim been upheld, the I would have upheld the cross-claim. 93 Senior counsel for Mr Smedley indicated that Mr Smedley wished to be heard on the question of costs. Thus, I will make orders for the parties to confer as to the orders to be made and for the Court to determine the appropriate orders if agreement is not reached between the parties. I certify that the preceding ninety-three (93) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Goodman.

Associate: Dated: 27 February 2025 SCHEDULE OF PARTIES NSD 1300 of 2021 Respondents Fourth Respondent: THOMAS VINES Fifth Respondent: STELLER ESTATE PTY LTD (IN LIQUIDATION) (RECEIVERS AND MANAGERS APPOINTED) First Cross-Claim Cross-Respondents Second Cross-Respondent JAMES CIRELLI Third Cross-Respondent ALASTAIR WILLIAMS