Masters in Building Training Pty Ltd v State of New South Wales

Procedural history

1. These proceedings first came before me in the Duty List on 31 March 2021. Although not having been formally served, the Department appeared.
2. Masters' summons, filed in Court that day, sought relief including: "Final Relief 1 A declaration that the letter from the Department of Education to the Plaintiff dated 25 March 2021 (Termination Notice) purporting to terminate with immediate effect the agreement between the Defendant and the Plaintiff entered into on or about 15 May 2020 and effective 1 July 2020 (Agreement) is invalid and of no effect. 2 A declaration that the Agreement remains on foot and binding. 3 An order that the Defendant is prevented from taking any action in accordance with the Termination Notice. 4 A declaration that the Defendant has breached the Agreement by; a. a failure to pay all fees due and owing; b. its purported termination of the Agreement by the Termination Notice. Damages 5 Damages, an account of profits and equitable compensation. 6 Interest. 7 Costs. 8 Such further order or other relief as the Court may see fit to grant. Substantive Interlocutory Orders 9 Upon provision of the Plaintiff of the usual undertaking as to damages, an order that until further order of the Court; a. the purported termination of Agreement by the Termination Notice is of no effect; b. the Defendant is to continue to perform its obligations pursuant to the Agreement; c. the Defendant is to take all steps to rectify or otherwise withdraw its communication to the Plaintiff's students, employers and any other third parties as to the purported Termination including correcting the communications dated 26 March 2021 sent without consent or notice to the Plaintiff; d. the Defendant is to notify the Plaintiff on affidavit of the names and contact details of any and all persons to whom it communicated the purported termination of the Agreement by no later than 14 days."
3. Masters' application for interlocutory relief was plainly urgent, not least because there was evidence that the Department's termination of the Contract had disrupted the studies of over 800 students. I stood the proceedings over to the next day, 1 April 2021, while I made inquiries as to what arrangements could be made to fix an urgent interlocutory hearing (including taking account of the intervening Easter break).
4. At the hearing on 1 April 2021, the Court made directions for the Department to file any affidavits upon which it proposed to rely and for the parties to provide written submissions. In accordance with the directions I made on that day, Masters' application for interlocutory relief was heard by me the following Friday, 9 April 2021.
5. The hearing took the entire day. While it was not practicable to deliver ex tempore reasons at the conclusion of the hearing, I informed the parties that the Court would grant Masters the interlocutory relief which it sought. Primarily, this required the Department to continue to perform its obligations under the Contract by providing funding (referred to in the Contract as "Subsidies and Loadings"). I stood the proceedings over to the following Monday, 12 April 2021, with an invitation to the parties to attempt to agree the precise form of interlocutory orders to be made.
6. The parties were able to reach an agreement as to the form of relief to be ordered on the basis of the Court's indication of the outcome. On 12 April 2021, I made the orders set out at [10], indicating that I would publish my reasons at a later date and thereafter entertain argument as to costs on the papers.
7. I record the Court's gratitude for the parties' helpful and thorough written submissions and the efficient way in which the hearing was conducted by counsel.

The Contract

1. The Contract included: "2. Purpose and objectives (a) The Contract sets out the terms and conditions for the payment of Subsidies and Loadings to the Provider for Training delivered by the Provider to Enrolled Students under a Smart and Skilled Program or the School Based Apprenticeships and Traineeships Program (Subsidised Training). (b) The Provider is responsible for the delivery of Subsidised Training to: (i) maximise usage of, but not exceed, any Financial Caps (ii) facilitate the provision of high quality Subsidised Training in accordance with Smart and Skilled: NSW Quality Framework, that is relevant to industry and employers; and (iii) promote the interests of students. (c) The Provider's entitlement to Subsidies and Loadings requires the Provider to comply with all of its obligations under this Contract and all Applicable Laws, including the RTO Standards. (d) The Provider acknowledges that the Department will take into account the Provider's performance in accordance with the Smart and Skilled Market Management Policy and other performance measures throughout the Term of the Contract. … 6. Review of the Contract (a) At least 2 months before the end of the Activity Period, the Department may provide to the Provider a notice (the Review Notice) asking for the Provider's consent to the terms and conditions in the Review Notice (which may include new Approved Qualifications Activity Schedule(s)). (b) If the Provider does not provide its consent to the terms and conditions in the Review Notice by the date set out in the Review Notice, the Contract will end on 30 June 2021. (c) If the Provider does consent to the terms and conditions in the Review Notice by the date set out in the Review Notice: (i) the Provider may immediately market and enrol students in Subsidised Training based on the new Approved Qualifications Activity Schedule(s) in the Review Notice; and (ii) the terms and conditions in the Review Notice will take effect on the date specified in the Review Notice. … 21.1 Termination for convenience (a) The Department may, at any time, terminate the Contract for any reason by giving at least 2 months' notice to the Provider. To be clear, the Department will have no obligation to pay any Subsidies and Loadings above what has accrued up to the date of termination of the Contract. This clause 21.1(a) does not limit the Department's rights under clause 21.2(c) or at law. (b) The Provider may, at any time, terminate the Contract for any reason by giving at least 2 months' notice to the Department. 21.2 Termination, suspension or variation for default (a) The Provider will not allow an Event of Default to occur. (b) If an Event of Default occurs, the Provider will immediately notify the Department of the Event of Default and provide sufficient detail to the Department to assess the significance and impact of the Event of Default. (c) If an Event of Default occurs the Department may, by written notice to the Provider, immediately: (i) suspend all or part of the Provider's rights under the Contract (ii) withhold in whole or in part any Subsidies and Loadings payable to the Provider (iii) place any further conditions in relation to Subsidised Training (iv) vary the Contract in accordance with clause 21.3 (v) exercise any of its other rights under the Contract; or (vi) terminate the Contract. (d) If the Department believes that an Event of Default has occurred, the Department may (but is not obliged to) give the Provider a notice requiring the Provider to show that there has been no such Event of Default, or to remedy the Event of Default where the Event of Default is capable of remedy. If the Department is satisfied that the Provider has failed to comply with the notice by either showing that the Event of Default did not occur or by remedying the Event of Default, the Department may, by written notice to the Provider, terminate the Contract. This clause 21.2(d) does not limit the Department's rights under the Contract (including clause 21.2(c) or at law). (e) Event of Default means any of the following (whether or not caused by anything outside the control of the Provider): (i) non-compliance: the Provider has not complied with any term or condition of this Contract (ii) incorrect or incomplete statement: any statement made by the Provider is incorrect or incomplete in a way which would have affected the original decision to enter into the Contract with the Provider (including the specific terms in the Approved Qualifications Activity Schedules) … (iv) void document: this Contract or any other related agreement entered into by the Provider and the Department is void, voidable or otherwise unenforceable by the Department or is claimed to be so by the Provider … (ix) unfavourable VET Regulator Audit Report: a VET Regulator audit report indicates a serious material or significant non-compliance of the standards set by the VET Regulator (x) regulatory decision of the VET Regulator: an adverse regulatory decision made by the VET Regulator which affects the Provider's ability to perform its obligations under the Contract, and/or is made in relation to an Approved Qualification, whether or not the Provider's rights for reconsideration or appeal have been exhausted … 21.3 Variation of the Contract … (d) This clause 21.3 does not limit the Department's rights under the remainder of the Contract. (e) In giving notice of any changes under this clause 21.3, the Department will specify the date on which the change is to take effect. … 21.4 Effect of notice of termination Following receipt of a notice of termination from the Department, the Department will not allow the Provider to Commence any further students, unless otherwise notified by the Department to the Provider. 21.5 Effect of termination If the Contract terminates, the Provider will (at its own cost) do anything that the Department requests, including any one or more of the following: (a) provide all reasonable assistance to facilitate the transfer of all Enrolled Students to another registered training organisation, including: (i) complying with the Transfer Out Process; and (ii) providing all information, documents or certifications required by the Enrolled Student such as a Statement of Attainment or Testamur, (b) pass on any communications or information to Enrolled Students (c) ensure that all Training Activity Data has been submitted in accordance with its obligations under this Contract (d) cease the delivery of Subsidised Training to Enrolled Students; or (e) continue to deliver Subsidised Training to Enrolled Students who have Commenced, under clause 21.7. 21.6 Effect of suspension If all or part of the Contract is suspended: (a) the Provider will (at its own cost) do anything that the Department requests, including: (i) continue to deliver Subsidised Training to Enrolled Students who have Commenced, under clause 21.7 (ii) cease to deliver Subsidised Training to Enrolled Students who have Commenced (iii) cease to enrol Prospective Students (iv) ensure that all Training Activity Data has been submitted in accordance with its obligations under this Contract (v) comply with any condition that the Department imposes; and (b) the Department may withhold all or part of the Subsidies and Loadings during the period that the Contract is suspended. 21.7 Continuation of Subsidised Training If the Department requests the Provider to continue to deliver Subsidised Training to Enrolled Students who have Commenced: (a) the Provider will continue to provide the Subsidised Training in accordance with the terms and conditions of the Contract; and (b) the Provider will comply with any additional conditions imposed by the Department. … 36.8 Waivers and consents Except as expressly stated in the Contract, each Party acknowledges that: (a) a waiver or consent under the Contract is not effective unless it is in writing and signed by the Parties entitled to give the waiver or consent (b) a waiver or consent may be given conditionally or unconditionally or withheld in the absolute discretion of the Party entitled to give the waiver or consent (c) a waiver of a power or right or the giving of consent is effective only in respect of the specific instance to which it relates and for the specific purpose for which it is given (d) a Party's failure or delay to exercise a power or right does not operate as a waiver of that power or right; and the exercise of a power or right does not preclude either its exercise in the future or the exercise of any other power or right."
2. Masters had been under a contract to the same effect as the Contract since 2014 with annual renewals. It was common ground that the Contract had been created on or about 15 May 2020 to commence on 1 July 2020, by Masters accepting the terms and conditions in a "Review Notice" issued under clause 6 of the predecessor contract (in like terms to clause 6 of the Contract set out above). There was also no dispute that (but for the purported termination) the Department would not have issued a Review Notice pursuant to clause 6 of the Contract, so that the Contract would have come to an end on 30 June 2021.

The facts

1. For the purposes of the interlocutory hearing, there was no real dispute about the objective events which led up to the purported termination of the Contract. As will be apparent from what follows, the relevant history began under the Contract's predecessor contract. That predecessor contract was in relevantly identical terms to the Contract and, in what follows, contractual provisions are referred to without distinguishing whether they are under the Contract or its predecessor.
2. In May 2019, Masters was notified by the Department that the Department wished to conduct a performance monitoring audit of Masters. The audit occurred during June and July 2019.
3. On 13 December 2019, without any prior communication or notification, the Department issued Masters with a notice of suspension under the predecessor contract. The notice was signed by Mr Emil Tabone, Director, Training Market Operations. It contained an appendix setting out alleged Events of Default. The effect of the suspension was that Masters could not enrol new students. The letter sought a response within 28 days but also offered Masters an opportunity to meet with representatives from the Department to discuss the alleged Events of Default.
4. A meeting took place between Masters management and the Department on 17 December 2019. On 6 January 2020 Masters delivered its response to the various allegations to the Department. According to the evidence of Mr Lawrence, on Masters' case most of the alleged Events of Default had been remedied prior to the meeting on 17 December 2019 and, according to his affidavit, "The balance of the events of non-compliance identified in the Notice are still the subject of an ongoing remedial process instituted by [Masters] and monitored by the Department."
5. By letter dated 24 January 2020, the Department gave Masters what was described as a "notice of partial release from suspension".
6. By letter dated 4 February 2020, the Department issued to Masters what was described as a "notice of lifting of suspension" which included: "As the Provider is aware, at the completion of the Performance Monitoring the Department determined that a number of Events of Default were sustained, which the Provider accepted. The Department then agreed to review more recent students at your request, stating that the Provider had improved its practice in recent times. This review is continuing and the Provider will be advised of the outcome shortly. … Lifting of suspension The Department acknowledges the Provider's demonstrated willingness to engage in a continuous improvement plan to ensure it delivers high quality training. Therefore, the Department has decided, with immediate effect, to lift all suspension which was put in place on 13 December 2019. The Provider is now able to enrol new students and commence training for Enrolled Students who had not yet Commenced. Please be aware, further restrictions may be considered should the Provider fail to implement its continuous improvement plan to ensure Contract compliance. …"
7. On 29 April 2020, the Department emailed Masters what was described as a "Review of Remediation". According to Mr Lawrence's affidavit, it contained a review of the evidence that had been provided to the Department by Masters in January 2020. This required further action on the part of Masters, the detail of which it is not presently relevant.
8. While the matters referred to in the preceding paragraph were being dealt with, on 15 May 2020 the Department issued Masters with a Review Notice under clause 6 of the predecessor Contract, which Masters accepted. This had the effect of bringing the Contract into existence which, in accordance with its terms, would come to an end on 30 June 2021 unless extended by the acceptance of a further Review Notice.
9. On 22 June 2020, the Commonwealth regulator, the Australian Skills Quality Authority (ASQA), gave Masters notice of a decision to suspend part of Masters' scope of registration under the National Vocational Education and Training Regulator Act 2011 (Cth) (the NVR Act). Masters' application for a review of the decision was received by ASQA on 19 July 2020.
10. By letter dated 13 July 2020, the Department, having become aware of ASQA's decision to suspend four qualifications from Masters' scope of registration, gave Masters a notice under clause 21.2(c)(i) of the Contract, suspending those same qualifications.
11. By letter dated 11 September 2020, the Department gave Masters a further notice under clause 21.2(c)(i) of the Contract, suspending all qualifications. The reason for the suspension was recorded as: "On 13 December 2019 the Providers was notified by the Department of a number of Events of Default under the Contract. The Department afforded the Provider an opportunity to show, for each issue identified, that no such Event of Default occurred or, where the Event of Default did occur, that it was remediated. The Department has reviewed the Provider's responses of 14 December 2019, 30 May 2020 and 19 June 2020 and have found that the Provider has failed to show that all of the Events of Default did not occur or demonstrate adequate remediation. Details of the Events of Default are at Appendix A."
12. The letter invited Masters to give a response to the alleged Events of Default outlined in Appendix A to the letter.
13. In early October 2020, Masters retained Mr Peter Cribb, solicitor, to represent it in its ongoing dealings with the Department. Mr Cribb wrote letters dated 6 and 7 October 2020 on behalf of Masters to the Department providing further information to the Department and dealing with other matters.
14. By letter dated 16 October 2020, ASQA informed Masters that it had varied its decision (outlined at [26]) and would not be imposing the suspension. However, ASQA's letter stated that Masters "remain non-compliant with the Standards for RTOs which is a breach of the condition of your organisation's registration required by section 22 of the NVR Act" (the Non-Compliance Issue). The letter also said that ASQA had decided to issue a written direction requiring Masters to rectify specified breaches within 20 working days.
15. Also on 16 October 2020, the Department responded to Mr Cribb with a letter which included: "TSNSW always strives to act reasonably in the exercise of its rights under the Smart and Skilled Program. This is evidenced by the fact that the Department has sought work with your client to give it an opportunity to remediate the systemic performance issues that have been identified over a significant period of time. The Department will be pleased to provide further assistance to your client to improve their performance moving forward."
16. By letter dated 19 October 2020, Mr Cribb replied to the Department's letter of 16 October 2020.
17. By letter dated 26 October 2020, the Department responded to Mr Cribb providing further information and saying: "In light of your most recent correspondence and the receipt of further advice from ASQA that your client has been given a written direction to rectify Non-Compliance with the Standards for Registered Trading Organisations 2015, the Department is not able to respond further at this time. It is anticipated that the Department will be in a position to better respond to you further on these matters by no later than 2 November 2020. As the matters set out in the Department's notice dated 11 September 2020 remain outstanding, the Department will not lift the current suspension that has been imposed on your client at this point in time."
18. By letter dated 28 October 2020, Mr Cribb wrote to the Department making various representations on behalf of Masters, ultimately requesting that the suspension that had been put in place on 13 July 2020 be lifted by no later than 4 November 2020.
19. By letter dated 5 November 2020, the Department responded to Mr Cribb, including: "The Department has now reviewed the reports received from the two External Specialist Reviewers in relation to the information provided by your client on 13 October 2020. It is the Department's position, that the Provider has failed to satisfactorily remediate all the outstanding Events of Default identified. In light of your most recent correspondence and the receipt of further advice from ASQA that your client is still not compliant with the Standards for Registered Training Organisations 2015, the Department is not able to respond further at this time. As the matters set out in the Department's notice dated 11 September 2020 remain outstanding, the Department will not lift the current suspension that has been imposed on your client at this point in time."
20. On 6 November 2020, Mr Cribb wrote a lengthy response to the Department, which included a request that he be provided with a copy of the "reports from the two External Specialist Reviewers" in order that Masters "may have some understanding as to which "outstanding Events of Default" it has failed to satisfactorily remediate and full details and particulars of the nature and extent of such failures".
21. On 26 November 2020, Mr Cribb again wrote to the Department requesting, amongst other things, responses to parts of his letters of 6 October and 6 November 2020.
22. By letter dated 10 December 2020, the Department responded to Mr Cribb, including: "In relation to the issues raised in point 4, the Department's decision on 4 February 2020 to lift [Masters'] suspension was made in good faith, on the basis that [Masters] would remediate the identified Events of Default. The intention of the remediation process is to remedy the issues identified in the Events of Default for past and continuing students … In relation to point 6, the Department has been made aware that ASQA issued [Masters] with a written direction, pursuant to s 35A of the National Vocational Education and Training Regulator Act 2011 (Cth), that requires [Masters] to rectify the breach of conditions by addressing each Non-Compliance detailed in its audit report within 20 working days of the date of that written direction. The Department has not been advised that Non-Compliances have been rectified."
23. Masters had appointed its own expert reviewer in or about September 2020. That reviewer's report was sent to the Department on 10 December 2020 together with additional evidence which, according to Mr Lawrence's evidence, was intended to support Masters' claim that it had successfully remediated all the outstanding issues forming the basis of the Department's suspension.
24. On 22 December 2020, the Department wrote to Mr Cribb, including: "On 10 December 2020, Mr David Thompson, the Provider's Chief Operations Officer, acknowledged the Department's concerns and provided further evidence to support the Provider's claim that it has now successfully remediated the issues which are the subject of the suspension. This new information is currently being reviewed and the Department will advise the Provider of the outcome once this review is completed."
25. On 23 December 2020 and 22 January 2021, Mr Cribb wrote to the Department providing further information. He also requested that the Department respond to various inquiries he had made, including as to the outcome of the Department's review of the further evidence referred to in the two preceding paragraphs.
26. By letter dated 22 January 2021, the Department responded to Mr Cribb's letters of 23 December 2020 and 22 January 2021, including a request for evidence of reassessment by Masters of five students. The Department's letter included: "Once the Department has received the requested evidence it will be able to complete its full review of the matter."
27. On 4 February 2021, Mr Cribb responded to the Department's letter of 22 January 2021 making a number of detailed points and requests over three pages.
28. On 15 February 2021, Mr Cribb emailed Mr Tabone: "I refer to my emailed letter of 4 February 2021 (see below and attached) and to my telephone message left on 11 February 2021 asking you to return my call. I note that I do not appear to have received a response a response to either that letter or that telephone follow-up call. If the Department is not prepared to reasonably engage with [Masters] in bringing the Department's suspension(s) to an end - particularly in relation to those courses/qualifications not the subject of any direct criticism by the Department - [Masters] will have no choice but to resort to litigation, however, I would welcome the opportunity of discussing with you on the telephone (before or after my receipt of the Department's response to my letter of 4 February 2021 (or, for that matter, at any time)) any concerns that the Department has or any proposals that the Department has to bring the matter to a mutually acceptable early resolution."
29. That email resulted in Mr Tabone and Mr Cribb speaking on 16 February 2021. In a subsequent letter to Mr Tabone dated 10 March 2021, Mr Cribb said of that conversation: "I also refer to my telephone conversation with you on 16 February 2021. From comments that you made towards the end of that telephone conversation, I understood that you would be providing a response of (sic) my letter of 4 February 2021 in the fullness of time. In short, my correspondence of February 2021 (following earlier correspondence dating back to October 2020) and my comments in our telephone conversation in February 2021 were aimed at the lifting of suspensions imposed by the Department in July and September 2020."
30. By letter from Mr Tabone to Masters dated 4 March 2021, the Department gave further notification of additional Events of Default, including: "Over a number of months, the Department has received feedback from various third parties, relating to the training being delivered by the Provider. These complaints relate to a number of Approved Qualifications and raise significant concerns. Specifically, the feedback suggests that the Subsidised Training is not delivered in accordance with clause 14 of the Smart and Skilled Operating Guidelines and identifies: A lack of engagement with students … A lack of face to face training … A lack of quality training during practical sessions … In the Department's view, these issues demonstrate Non-Compliance by the Provider with the Contract. These Events of Default are in addition to the Events of Default notified to the Provider by correspondence dated 13 December 2019, which have not been remedied. In accordance with clause 21.2(d) of the Contract, the Department requires you to respond to this notice. To facilitate that response the Department has scheduled a meeting for 9.30am, Friday, 12 March 2021. The meeting is to take place at level 6, 2-10 Wentworth Street, Parramatta. Mr Emil Tabone, Director Training Quality and Regulation and Mr Stephen Buddeke, Leader Provider Management (Reconciliation and Appeals) will be present and request that you and any other suitable representative for the Provider attend. … If you fail to comply with this notice, including the timeframes stated, the Department will exercise its rights under clause 21.2 of the Contract."
31. By letter dated 10 March 2021 to Mr Tabone, Mr Cribb, among other things, asked for the Department to provide "a copy of all documents the Department holds evidencing the "feedback" to which Your 4-3-21 Letter refers in order that [Masters] may have full particulars of the allegations made against it." Mr Cribb's letter also included: "While Your 4-3-21 Letter does require [Masters'] attendance at the meeting on 12 March 2021 - "to facilitate [Masters'] response" - that letter does not state a timeframe by which [Masters] is to "respond to [the] notice". For the avoidance of doubt, if it was the Department's intention to give [Masters] notice that [Masters] provide its response at the meeting, with respect, Your 4-3-21 Letter does not say that and while, as previously advised, [Masters] stands ready, willing and able to address any concerns that the Department may have, it is only fair and reasonable that [Masters] be given a reasonable period of time to respond after receiving full particulars of such concerns."
32. The meeting referred to in the Department's letter set out at [47] took place on 12 March 2021. Detailed notes of the meeting were in evidence, although (with the exception of what is dealt with at [87]) for present purposes nothing turns on exactly what was said, other than to note that the Department requested information about certain matters and that there was no reference to the possibility of the Contract being terminated.
33. On 12 March 2021 after that meeting, Mr Lawrence emailed Mr Stephen Buddeke of the Department, including: "Thanking you, Linna and Emil for meeting with us and allowing us to clear the air with the ridiculas (sic) allegations you received. I have attached the Trainers matrix as requested and would encourage you to look at the sheet named dossier which may assist in understanding why these trainers were disenchanted and made false accusations against me and [Masters]. Can you please confirm that the following documents are also required to be sent to you next week which include:… I also would like to confirm that Scott Molloy will advise us of the 5 students for each of the 3 quals (across 2 units) so we can recommence the reassessments and that we will supply the training and assessment materials for these units within 3 weeks direct from our LMS as per the meeting discussion today. Please let me know if there is anything else you may require."
34. The following Tuesday, 16 March 2021, Mr Buddeke attended to observe one of Masters' training sessions.
35. The following Friday, 19 March 2021, Mr Lawrence emailed Mr Buddeke and others at the Department, including: "Thank you for taking the time on Tuesday to witness one of the training sessions we were running at Mingara and interview students and trainers about their [Masters] experience. You did state that Linna had been away for the last couple of days however, it's been now five business days and we are yet to receive a reply to the email below [a reference to the email at [50] above]. As you can understand we would like to move forward and require the below items listed confirmed and added to if required. Please reply at your earliest convenience. Linna also mentioned that Scott Molloy would be supplying us the 5 names across 3 qualifications for reassessment in our upgraded methodology, we have actually been waiting for this for nearly two months, so I would appreciate receiving these details today. Looking forward to your positive response today."
36. Mr Buddeke responded to Mr Lawrence later that day by email: "Please find attached the list of students that the Department requires evidence of reassessment. As agreed, please provide the 'LMS learning and assessment task expert' that Mr Joe Newbury has referred to in his report and all training and assessment tools for the three qualifications that were the subject of the initial performance monitoring. The Department also requires the documents as listed in your 9 points of your email dated 12 March 2021 and the actual videos of the training that was conducted in Hay, which were uploaded to the students' online platform, as discussed in our interview of 12 March 2021. Please do not hesitate to contact me if you wish to discuss the matter further."
37. On 23 March 2021, Mr Lawrence emailed the Department including: "During our meeting on 12 March you requested I provide a reply to the correspondence from Emil Tabone re Appendix A. This reply, Appendix A, which included a new column titled "providers response September 2020," was supplied as part of our response on the memory stick with all the other evidence. This is the stick that went missing in the mail and eventually made it to you and Stephen. Can you please check if this is the document. Appendix A, you were referring to on 12 March? If not, can you let me know what document you are expecting a reply to so I can include it in the submission along with the 9 confirmed items from our 12 March meeting."
38. Without further response by the Department to Masters, by a notice dated 25 March 2021 signed by Mr Tabone on behalf of the Department, the Department purported to terminate the Contract (the Termination Notice). The Termination Notice included: "The Department terminates the Provider's Contract in accordance with clause 21.2.(c)(vi) of the Contract Terms and Conditions with immediate effect. Reasons for termination The Department notified the Provider by correspondence dated 13 December 2019 and 4 March 2021 of a number of Events of Default under the Contract. The Department, in accordance with clause 21.2(d) of the Contract Terms and Conditions, afforded the Provider an opportunity to show that there had been no such Events of Default or that the Events of Default had been remedied. The Department has reviewed the responses provided by the Provider to date and determined that the Provider has failed to show that all Events of Default did not occur or demonstrate satisfactory remediation. Effect of termination The Provider's Contract sets out the effect of termination. Specifically, the Provider must: • immediately cease to deliver Subsidised Training to all Enrolled Students • not make any reference to Smart and Skilled (including on its website, course information, any advertising or communications or in discussions with potential students) • follow the Transfer Out Process set out in paragraph 10 of the Smart and Skilled Operating Guidelines • advise all Enrolled Students of their options for continuing training • ensure that all students are issued with a Statement of Attainment or Testamur reflective of their actual training and assessment progress to date immediately on completion or the cessation of their Subsidised Training. …"
39. By letter dated 26 March 2021, Mr Cribb wrote to the Department, including: "The Department's issuing of the Termination Notice is also an extraordinary event given the recent correspondence, discussions and site visits directly between the Department and officers of [Masters] - consistent with [Masters'] ever-present preparedness and desire to address all concerns raised with it by the Department. I anticipate that [Masters] will provide instructions for proceedings to commence in the Supreme Court of New South Wales seeking injunctive and declaratory relief and compensation in relation to the Termination Notice and earlier decisions made by the Department and this letter - without any concessions being made as to the Department being able to do what it has purported to do - is to request that the Department allow [Masters] to (quoting from clause 21.5(e) of the terms and conditions of the Contract) "continue to deliver Subsidised Training to Enrolled Students who have Commenced, under clause 21.7" for a period of not less than 28 days from yesterday so as to avoid a situation whereby there would be the greater part of 1,000 students on the street as of this morning. As you would be aware there is nothing in clause 21 of the terms and conditions of the Contract that requires subsidised training to cease upon issuance of a document such as the Termination Notice. On the contrary, clause 21.4 is written as if existing students will continue with a terminated provider and the only issue is whether "any further students" should commence with a terminated provider. The Department's acquiescence to the above request will allow a more orderly process for existing students and an opportunity for the Court to deal, other than on an extremely urgent basis (such as this afternoon), with a stay application being made by [Masters] to maintain the status quo that existed yesterday morning."
40. By letter of the same date, Mr Tabone responded to Mr Cribb: "I refer to your correspondence dated 26 March 2021, specifically to the request that the Department allow the Provider to continue to deliver Subsidised Training to Enrolled Students for a period of not less than 28 days. The Department does not agree to this request. In accordance with the Notice, and clause 21.5(e) of the Contract, the Provider must cease delivery of Subsidised Training to Enrolled Students, effective upon receipt of the Notice. The Provider must also comply with requirements following termination that are set out in the Notice and under the Contract. To be clear, this includes providing the Department with a list of all current Enrolled Students on or before 30 March 2021 and finalising the submission of Training Activity Data on or before 22 April 2021."
41. Also on 26 March 2021, the Department sent an email to a number of employers whose apprentices were training with Masters, stating: "Our records indicate you currently employee apprentice(s)/trainee(s) in NSW who may be participating in NSW Smart and Skilled subsidised training with the Registered Training Organisation - [Masters]. From 25 March 2021, [Masters] ceased to be a NSW Smart and Skilled provider. This means that [Masters] is no longer able to deliver subsidised training in NSW from this date. If your apprentice(s)/trainee(s) are undertaking funded training with [Masters], you and your apprentice(s)/trainee(s) may: • choose to undertake the remainder of your training with another Smart and Skilled provider, or • continue training with [Masters] on a fee for service basis (subject to compliance with the Apprenticeship and Traineeship Act 2001). A Training Services NSW staff member will contact you shortly to discuss the possible transfer of your training to another Smart and Skilled training provider and to help you complete any necessary paperwork."
42. An email to similar effect to that set out in the preceding paragraph was also sent on 26 March 2021 to apprentices training with Masters.
43. Mr Lawrence's evidence was: "As a result of the actions of the Department, [Masters] has been prohibited from continuing to train over 800 students. Many of those students are in rural and regional areas where there is no access to alternative training providers. Many students who have undertaken units within qualifications may not have completed the units and so if they are transferred to another provider they will be required to recommence the unit at whatever stage of pre-completion they might have reached.'

Masters' submissions in chief

1. Mr O'Neill submitted that there was a serious question to be tried in respect of four matters: 1. That the Termination Notice did not contain a valid reason for termination under clause 21.2(c)(vi); 2. Neither letter incorporated into the Termination Notice by reference provided a valid reason for termination. This was in circumstances where many of the matters of complaint had been resolved, or should have been accepted as resolved by the Department, or even if unresolved, were not of a sufficiently serious nature to justify termination of the Contract; 3. Having embarked on the process of giving notice and requiring rectification under clause 21.2(d), looking at the events which had occurred since December 2020 and, in particular, after the meeting of 12 March 2021, the Department had breached an implied obligation (whether as a function of good faith or as an independent implied obligation) to give Masters a reasonable time to reply and respond. The Department had, in breach of those obligations, peremptorily acted to terminate the Contract. 4. Even if there were grounds for termination, the Department was bound to exercise its power in good faith so as to ensure the provision of services to students was protected under the Contract. This was in circumstances where the alleged Events of Default did not affect the provision of education to students.
2. In relation to the first of the two letters relied upon in the Termination Notice (described at [20]), Mr O'Neill submitted that it predated the Termination Notice by one and a half years and predated the Department's decision to lift the suspension (see [23]) and renew the Contract (see [17]). It had, in law, affirmed the Contract and waived its right to terminate in respect of those matters.
3. In relation to the Department's second letter (set out at [47]), Mr O'Neill submitted that the allegations it contained were imprecise. The Department had chosen to invoke the procedure under clause 21.2(d), and a process was underway in accordance with that clause.
4. After the luncheon adjournment, Mr O'Neill produced this summary of the way in which Masters put its case: "1. On or about 15 May 2020 the Plaintiff entered into an agreement with the Department effective from 1 July 2020 (Agreement). 2. The Agreement contained both implied and express terms. 3. To the extent those terms were express they were contained in writing in a contract known as a "Smart and Skilled Contract". 4. To the extent those terms were implied they were implied by conduct and law. 5. The express terms of the Agreement included, but were not limited to: a) the purpose and objectives of it (Clause 2); b) its term (Clause 5); c) a term for review (renewal) (Clause 6); d) general obligations upon the plaintiff (Clause 6); e) payment (Subsidies and Loading, Financial Cap) (Clauses 14 to 18); f) termination (Clause 21). 6. The implied terms of the Agreement included, but were not limited to: a) a duty of good faith; b) a duty to co-operate; c) a requirement that a party provide the other with reasonable time for the performance of any contractual obligation. 7. By its Notice of Termination, and the purported termination, the Defendant breached the contract by: a) failing to articulate, appropriately or at all, the Events of Default relied upon to exercise the termination provision in clause 21; b) failing to correctly exercise clause 21 in that it; i. incorrectly asserted Events of Default had occurred when they either: 1. had not; 2. further and alternatively, had been, or were in the process of being, remedied; 3. further and alternatively, had been previously accepted prior to renewal. c) further and alternatively, in breach of implied requirement that a party provide the other with reasonable time, failing to provide the Plaintiff time to properly answer and respond to the 4 March 2021 letter and (partially) particularised subsequently; d) further and alternatively, in breach of the implied duty of good faith; i. failing provide (sic) the Plaintiff time to properly answer and respond to, and/or relying upon, the 4 March 2021 letter (Including but not limited to addressing the previous contention in the 13 December 2019 letter); ii. relying upon the 13 December 2019 letter in circumstances where those matters were the subject of rectification or had been accepted; iii. failing to invoke the less severe mechanisms for rectification contained within the Agreement. e) further and alternatively, in breach of the implied duty of co-operation: i. failing provide (sic) the Plaintiff time to properly answer and respond to, and/or relying upon, the 4 March 2021 letter (including but not limited to addressing the previous contention in the 13 December 2019 letter); ii. relying upon the 13 December 2019 letter in circumstances where those matters were the subject of rectification or had been accepted; iii. failing to co-operate with the Plaintiff to permit the rectification of any sustained Event of Default, or hearing it with respect of why an Event of Default was in fact no such thing, so as to permit the ongoing performance of the Agreement."
5. Mr O'Neill submitted that the balance of convenience strongly favoured requiring the Department to continue to perform the Contract because of the effect the termination had on over 800 students. Unless the students were able to fund their training with Masters themselves, they had without warning been put into a position where they would need to look elsewhere, if they could, to complete their training. In practical terms, all that requiring the Department to honour the Contract really required it to do was to continue to provide funding, as opposed to actively managing or providing services. Funding would not require the Court's supervision. It was Masters who wanted to provide services to its students.
6. Accepting that the Department was not going to renew the Contract in any event, the Department's actions had deprived the students of what would have been an orderly opportunity to complete their studies with Masters or transfer in an orderly fashion to alternative training providers. Having regard to clause 6(a) of the Contract, both Masters and its students would have had at least two months' notice that the Contract was going to come to an end on 30 June 2021. This is because the notice required to invite renewal of the Contract had to be given at least two months before the expiry of the Contract. The Department's purported termination had deprived Masters, and more importantly, the students, of the benefit of what would have been at least eight weeks' notice. Instead, the students' courses had been precipitously terminated and, notwithstanding the Department's promises of assistance, there was no guarantee that satisfactory solutions would be found to enable the students to continue their studies with the benefit of whatever level of achievement they had reached in the course of their studies with Masters.
7. Finally, there was no real prejudice to the Department by ordering continued performance of the Contract. Assuming Masters' students were able to make alternative arrangements, the Department would still be making payments in respect of those students undertaking their studies with alternative training providers rather than with Masters. In other words, the Department's outflow of funds for Masters' students would continue in any event, but paid to another provider.

The Department's submissions

1. Mr Simpson's submissions for the Department, in particular his written outline, included an extensive summary of the applicable legal principles. I do not propose to reproduce that summary in these reasons because they are well known and they were not seriously in dispute between the parties. I will confine this summary to the substance of how Mr Simpson sought to apply those principles to the facts at hand.
2. Mr Simpson submitted that the application for an interlocutory mandatory injunction was really to be understood as an application for a final order for specific performance. While accepting that there was no special test for a mandatory interlocutory injunction, he submitted that the Court should bear in mind what was said in J D Heydon, M J Leeming and P G Turner, Meagher, Gummow & Lehane's Equity: Doctrines and Remedies (5th ed, LexisNexis, 2014) at [21-395]: "In truth, a court hearing an application for an interlocutory mandatory injunction must apply exactly the same tests as it would in the case of an application for an interlocutory prohibitory injunction, not some different or more exacting test. Nor is the fact that the relief sought is mandatory a ground for refusing relief. But in the application of the normal tests, often, though not always, the fact that the relief sought is mandatory will tilt the balance of convenience in the defendant's favour."
3. Next, it was submitted that mandatory interlocutory injunctions are rare and that it is settled practice that the Court would not grant a mandatory injunction where it would require persons to carry on business, save for the most exceptional circumstances: Co-operative Insurance Society Ltd v Argyle Stores (Holdings) Ltd [1998] 1 AC 1 (Co-operative Insurance).
4. Mr Simpson submitted that the relief sought by Masters was final relief disguised as interlocutory relief, and was not deployed in aid of any final relief. He submitted that was sufficient to refuse the relief sought. It is convenient to interpolate immediately that the Court did not accept that submission. The interlocutory relief sought was properly in aid of the declarations sought as final relief in the summons (set out at [10]).
5. It was argued that on its proper construction, clause 21.2(c)-(e) meant that where there was an Event of Default the Department could either: 1. immediately terminate the Contract; or 2. issue a notice to Masters requiring Masters to demonstrate that there was no Event of Default or that the Event of Default had been remedied.
6. It was submitted that if the Department was not satisfied of either of the matters referred to in (2) of the preceding paragraph, the Department was entitled to terminate the Contract by written notice.
7. Mr Simpson argued that the Termination Notice was validly issued both in accordance with the Contract and in accordance with those principles requiring the notice to convey unambiguously a decision to terminate, construed by reference to how a reasonable person would understand it in the circumstances of the particular case. There were clearly Events of Default continuing to exist up to and following the Termination Notice. As at 25 March 2021, those were: 1. Masters' failure to assess or rescind the qualifications of students that had been assessed by an unqualified trainer; 2. Masters' failure to maintain adequate records of specified types; 3. The Non-Compliance Issue (Masters having been assessed as non-compliant with the standards administered by ASQA); and 4. Masters failing to engage with students and conduct face to face training and quality training during practical sessions.
8. In the course of oral argument, Mr Simpson described as "indefensible" two of alleged Events of Default, being the Non-Compliance Issue and what was said to have been a failure by Masters (and admitted by Mr Lawrence at the 12 March 2021 meeting) to engage with students and conduct face to face training. Mr Simpson accepted that the Non-Compliance Issue was not referred to in the Termination Notice, but submitted this alleged Event of Default was still available to the Department to justify the Termination Notice in accordance with Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359.
9. Insofar as Masters sought to rely on implied terms of good faith and reasonableness, Masters had failed to demonstrate how they could be implied having regard to the well-known tests in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 (BP).
10. Turning to whether or not Masters had been given a reasonable time to respond to the Department's concerns, particularly over the period of 4 to 25 March 2021, this had to be determined in the context of what Mr Simpson described as the "litany of historical breaches". When these were taken into account, any obligation to provide a reasonable time to respond (assuming there was such an obligation) had been satisfied.
11. Mr Simpson next submitted that damages would be an adequate remedy. Furthermore, given the nature of the Contract, Masters' damages would be de minimis. The present dispute was only about Masters' financial entitlements under the Contract.
12. In relation to the balance of convenience, Mr Simpson contended that the Court should be satisfied on the basis of an affidavit filed by Mr Tabone that the students would be looked after. Arrangements were in place to assist them to transition to other training providers. In addition, Masters had not identified any harm to itself (as opposed to the students) if interlocutory relief was not granted.
13. As far as the Department's position was concerned, the harm to it was not just monetary. It still had a supervisory role and there was a real risk that granting the orders would involve further supervision of the Court. For example, if any further notices of Events of Default had to be given or a further termination sought, this would require the Department to make an application to the Court.
14. Finally, Mr Simpson advanced two discretionary arguments.
15. The first was to raise an issue of unclean hands on the part of Masters. This was said to be constituted by Masters' breaches of contract forming the basis for the termination, monies said to be outstanding to the Department, and an email from Mr Lawrence immediately following the purported termination which was said to be threatening to Mr Tabone.
16. It is convenient to deal with the unclean hands argument immediately. I rejected the first matter referred to by Mr Simpson as circular. If, as the Court was satisfied, there is a serious question to be tried about whether there were breaches (see [92]), then the assertion of such breaches can hardly be called in aid as examples of unclean hands. In relation to the second matter, it was accepted that there was an instalment plan between Masters and the Department, and Mr Simpson was unable to obtain instructions that Masters was in breach of that plan. Finally, I do not regard Mr Lawrence's perhaps understandably intemperate email to Mr Tabone after the purported termination ("You have picked a fight with the wrong guy. Now its (sic) personal. Enjoy your weekend.") as being of sufficient seriousness to affect the discretionary equation.
17. The second discretionary matter relied upon by Mr Simpson was that to order the Department to continue to observe its obligations under the Contract was an exercise in futility. This was because the Department had indicated that it would not seek to renew the Contract, which now had less than three months to run.

Masters' submissions in reply

1. It is only necessary that I record Mr O'Neill's submissions in response to what Mr Simpson had described as the two "indefensible" defaults. By this I understood Mr Simpson to submit they were unanswerable.
2. In relation to the Non-Compliance Issue, Mr O'Neill submitted that even if there was such an Event of Default, there was a serious question to be tried about whether it was of sufficient seriousness to justify termination of the Contract. For example, he drew attention to the fact that after being notified on 16 October 2020 that ASQA had varied its suspension decision (see [31]), the Australian Capital Territory had reinstated Masters in that jurisdiction. He also referred to various items of correspondence between the Department and Mr Cribb going to the question of whether, as a matter of fact, the Non-Compliance Issue had been resolved.
3. In relation to the so-called admission, a note of what transpired at the meeting on 12 March 2021 recorded that Mr Buddeke said that Masters "had not been seen for 12 months by one of the employers" to which Mr Lawrence is recorded as replying that he "had also heard this". Mr O'Neill submitted this was hardly an admission and, insofar as any complaint about face to face teaching over the last 12 months was concerned, this had to be viewed in the context of restrictions imposed during the COVID-19 pandemic.
4. I accepted Mr O'Neill's submissions as to why both of the alleged "indefensible" Events of Default did not properly bear that character. These matters also fall within the observations that I make at [89] to [92] below.

Consideration

1. I begin by setting out to what I did not give dispositive weight: the debate between the parties about whether, and if so to what extent, any Events of Default remained extant and, if they did, their seriousness. Resolution of this issue is one aspect of determining whether the Termination Notice was valid and effective to terminate the Contract.
2. Each side provided the Court with detailed tables setting out its version of what might be referred to, without disrespect, as the "state of play" in relation to the alleged Events of Default. As I indicated to the parties during the course of argument, the amount of correspondence and the level of detail that would need to be absorbed to understand the significance of the various alleged Events of Default and the extent to which they had been resolved was quite beyond what the Court could do in an urgent one day hearing.
3. In this context, I observe that the history of events that I have set out at [18] to [60] is not a complete record of the correspondence. There were numerous communications and even those to which I have referred are far more lengthy and detailed than the short extracts which I have quoted. I have endeavoured to confine that history to specific matters to which the Court's attention was drawn during the course of argument.
4. The detail of the parties' tables, even without reference to the underlying arguments set out in the correspondence, amply demonstrated that there was a serious question to be tried as to the status of the alleged Events of Default. However, given the detail of those matters and the time available to me, I was unable to come to a view about who might have the better argument at the end of the day. For that reason, I treated that conclusion as a neutral factor in the Court's consideration of whether or not interlocutory relief should be granted.
5. However, I was able to come to the clear conclusion that, in my respectful view, there was a serious question to be tried as to the matters conveniently set out in Mr O'Neill's summary reproduced at [64], and that Masters had a strong case in that regard because the terms sought to be implied did satisfy the test set out in BP. There is a serious question to be tried as to whether, by reason of implication of terms, clause 21.2(d) means that once the Department has engaged the process set out in that clause by giving a notice, it must both exercise its rights under and pursuant to that clause in good faith and (whether as part of the obligation of good faith or as a freestanding implied obligation) afford a party in Masters' position a reasonable time to deal with the matters set out in any notice. Furthermore, having invoked that course, there is a serious question to be tried about whether any implied good faith obligation informs the remedy (including but not limited to termination) which might be the end product of the process in clause 21.2(d).
6. Concurrently with my satisfaction that there was a serious question to be tried as to good faith and reasonable time obligations implied into clause 21.2, I was also satisfied that, on the established facts, there was a serious question to be tried as to whether those obligations had been breached. The history to which the parties took me and which I have endeavoured to set out in [18] to [54] above, including the fact that the Department chose to renew the Contract and thereafter continued to engage with Masters, all provides a strongly arguable basis for concluding that the Department's sudden termination of the Contract on 25 March 2021 (what Mr O'Neill described as "snapping its fingers") was in breach of those obligations. This is particularly the case when one takes into account the course of events set out in [47] to [54] above.
7. There was no dispute between the parties that, insofar as an interlocutory mandatory injunction was being sought, there was no special test to be applied over and above the usual tests for an interlocutory injunction. I also record that I did not see any material difference in how the Court should approach the matter whether it was characterised as being for an interlocutory mandatory injunction or an order for specific performance.
8. Nevertheless, given the high likelihood that a final hearing would not be able to fixed before 30 June 2021 when the Contract will end in any event, I did consider that granting Masters relief would in a practical sense resolve the substance of the dispute between the parties. I therefore took into account what was said by McClelland J (as his Honour then was) in Kolback Securities Ltd v Epoch Mining NL (1987) 8 NSWLR 533 at 535-536: "As I see it, the position is as follows. Where a plaintiff's entitlement to ultimate relief is uncertain, the Court, in deciding to grant or refuse an interlocutory injunction, must consider what course is best calculated to achieve justice between the parties in the circumstances of the particular case, pending the resolution of the uncertainty, bearing in mind the consequences to the defendant of the grant of an injunction in support of relief to which the plaintiff may ultimately be held not to be entitled, and the consequences to the plaintiff of the refusal of an injunction in support of relief to which the plaintiff may ultimately be held to be entitled: see, eg, Appleton Papers Inc v Tomasetti Paper Pty Ltd [1983] 3 NSWLR 208 at 216; A v Hayden (No 1) (1984) 59 ALJR 1 at 4-5; 56 ALR 73 at 79. Where the uncertainty depends in whole or in part on a contested question of fact it is not appropriate for the Court to decide that question on the interlocutory application. Where the uncertainty depends in whole or in part on a contested question of law, it may or may not be appropriate for the Court to decide that question on the interlocutory application, depending on circumstances, eg, whether the question is novel or difficult, or is susceptible of resolution on the present state of the evidence, or whether the urgency of the matter renders it impracticable to give proper consideration to the question: see, eg, A v Hayden (No 1) (at 4; 78); Cohen v Peko-Wallsend (1986) 61 ALJR 57 at 59; 68 ALR 394 at 397. If the Court does decide the question of law the uncertainty is to that extent removed. Unless the plaintiff shows that there is at least a serious question to be tried which if resolved in its favour would entitle it to final relief, then the requirements of justice as between the parties will dictate that an interlocutory injunction should be refused: Australian Coarse Grain Pool Pty Ltd v Barley Marketing Board of Queensland (1982) 57 ALJR 425; 46 ALR 398; Tableland Peanuts Pty Ltd v Peanut Marketing Board (1984) 58 ALJR 283; 52 ALR 651; A v Hayden (No 1); Castlemaine-Tooheys Ltd v South Australia (1986) 60 ALJR 679; 67 ALR 553 and Cohen v Peko-Wallsend Ltd. Apart from this, although normally the Court "does not undertake a preliminary trial, and give or withhold interlocutory relief upon a forecast as to the ultimate result of the case" (Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 at 622), there are some kinds of case in which for the purpose of seeing where lies the balance of convenience (or more specifically "the balance of the risk of doing an injustice" - see per May LJ in Cayne v Global Natural Resources plc [1984] 1 All ER 225 at 237, cf per Brennan J in Brayson Motors Pty Ltd v Federal Commissioner of Taxation (1983) 57 ALJR 288 at 292; 46 ALR 279 at 285), it is desirable for the Court to evaluate the strength of the plaintiff's case for final relief: see, eg, Brayson Motors Pty Ltd v Federal Commissioner of Taxation (at 292; 285); Castlemaine-Tooheys Ltd v South Australia at 682; 559. One class of case to which this applies is where the decision to grant or refuse an interlocutory injunction will in a practical sense determine the substance of the matter in issue: see, eg, NWL Ltd v Woods [1979] 1 WLR 1294 at 1306-1307; [1979] 3 All ER 614 at 625-626 per Lord Diplock; Cayne v Global Natural Resources plc. The present is such a case. The substantial matter in issue is whether Epoch should be permitted to proceed with the issue of non-renounceable rights in accordance with the announcement of 13 March 1987. That will be irrevocably determined in a practical sense by the grant or refusal of an interlocutory injunction."
9. Applying his Honour's analysis, I regarded this as a case where it was desirable for me to evaluate the strength of Masters' case for final relief, doing the best I could on the material before me. In my view, Masters had a strong case for final relief in respect of the matters which I have identified about which there was a serious question to be tried. That success would mean that the Department had not been entitled to issue the Notice of Termination.
10. I also did not accept that the principle in Co-operative Insurance (see [70]) had any application to the present case. This is because the Department was not like a defendant who would be forced to carry on a business. The Court was satisfied the Department was primarily, although of course not exclusively, a funder. It is Masters that was anxious to be able to get on with its business.
11. Turning to the balance of convenience, I accepted Mr O'Neill's submissions set out at [65] to [67] above. In particular, the position of the students was a factor which weighed heavily in favour of granting the relief sought. There was evidence from one student of the disadvantage he would suffer if he was unable to continue with the courses that he was undertaking with Masters, which were due to be completed on 15 April 2022. His evidence was there was no suitable alternative provider in his region. I accept that this was the evidence only of one student. However, there was also evidence from Mr Lawrence of the general disruption that would be suffered by more than 800 students, many of whom were in areas where there were no alternative providers.
12. I was not persuaded that Mr Tabone's evidence for the Department about arrangements being put in place to assist Masters' students (which I readily accept was being done) was a sufficient answer to neutralise in the balance of convenience what was an abrupt disruption to the students who were, in terms of the dispute between the Department and Masters, entirely innocent third parties.
13. Nor did I accept Mr Simpson's submissions set out at [80]. While I accept his submissions as correct in theory, there was no evidence to suggest that in reality any kind of supervision was likely to be required during the less than three months that the Contract had to run. Putting this another way, the risk of inconvenience to the students and Masters was certain, whereas it was far from certain for the Department. This was not a case where the mandatory nature of the relief being sought tipped the balance of convenience in favour of the Department (see [69]).
14. These same considerations which informed my conclusion on the balance of convenience were also why I concluded, contrary to Mr Simpson's submissions, that damages would not be an adequate remedy and that granting the relief would not be futile.

Conclusion

1. For these reasons the Court made the orders set out at [5]. As I foreshadowed at the time of making those orders, the Court will make directions for any argument as to costs to be resolved 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: 30 April 2021