Owston Nominees No 2 Pty Limited v Branir Pty Limited [2003] FCA 629 | Case summary

Federal Court of Australia|1997-11-12|Before: Einfeld J, Allsop J

REASONS FOR JUDGMENT 1 This is an unusual, though not unprecedented, circumstance. 2 On 25 February 2000, Einfeld J in the present proceedings delivered reasons of 271 paragraphs over 104 pages. His Honour had heard the matter over nineteen days from 31 August 1998 to 23 April 1999. Written submissions were concluded on 30 April 1999. The hearing involved a view (including aerial viewing taken by helicopter) of the large Northern Territory cattle station, Tipperary, that was the central focus of the dispute. The last paragraph of his Honour's reasons bears repetition. [271] I express my appreciation to counsel and their instructing solicitors and clerks for their assistance in this difficult case, and to the parties and their staffs for their many courtesies especially at the hearings in Bali and at Tipperary Station, and in the Court's inspection of the Sanctuary and Tipperary itself. The applicants' submissions provided a useful description and summary of the development of the Sanctuary which, together with the evidence and my observations at the on-site inspection, I have largely used. I thank those responsible for this contribution to this judgment. Indeed, the submissions of both parties were of a particularly high quality without which, in view of the complexity and detail of the case, these reasons for judgment would not have been achievable in any reasonable time frame or with the same degree of consideration of the issues. I acknowledge the work of those responsible for their excellence. 3 The history of the dispute can be found in the judgment of Einfeld J ([2000] FCA 145) and in my judgment sitting as a member of the Full Court ([2001] FCA 1833). Today's reasons assume a familiarity with, and are to be read with, both judgments. Einfeld J did not make final orders on the day he delivered reasons, 25 February 2000. Orders were not made until 11 September 2000. In the intervening period, there were further submissions involving senior counsel on both sides. The orders made on 11 September 2000 are conveniently set out at [250] of my reasons on appeal. They included declarations 1(a) and (b) which were in the following terms (corrected, as is agreed by the parties, by the insertion of the word "applicant" after the words "to the first" and before the words "for the life of" in 1(a)): THE COURT: 1. declares that there was as at 23 December 1993, and still subsists, a binding agreement between the parties that: (a) subject to Ministerial consent being obtained, and for the purposes of expanding and operating the Sanctuary and building a residence and other necessary buildings thereon, a lease or other substantial exclusive grant without rental or fee be granted by the first and second respondents to the first applicant for the life of the second applicant over the area of Tipperary Station known as the Tipperary Wildlife Sanctuary, plus an additional area adjacent to the Sanctuary so that its total area is 20,000 acres; (b) no part of the Sanctuary so expanded is to include any part of the existing Tipperary Station homestead area or mango plantation but is to cover, as closely as a professional survey will permit, the land adjacent to the present Sanctuary (known as Stages I, II, III and IV) up to approximately the northern boundary of the paddock known as "Campbells" and west of the road as far as necessary to encompass (together with the existing Sanctuary area) 20,000 acres of the paddocks known as Turkey Flat, Little Gardener, Jumbo, Electric Fence and Boords; 4 An appeal was taken from those orders. It was heard by Drummond and Mansfield JJ and myself. The appeal lasted five days. Whilst the orders of Einfeld J were varied, in substance, the appeal was unsuccessful. It is not doing any injustice to counsel who ran the appeal on behalf of the appellants (the respondents in the proceedings in the original jurisdiction) to say that every conceivable and proper point was run. That is not said with the slightest disrespect. If I may be permitted to say so, Mr Campbell QC (as his Honour then was) put forward his arguments with great skill and application. Though these parties had had the misfortune to fall out in their business relationship, they were served before Einfeld J in the manner described by his Honour at [271] (see [2] above) and similarly on appeal. These comments are not made in gratuitous praise of the legal practitioners involved. It is important, at the outset, to understand the nature of the proceedings: a long, and, unfortunately, bitter commercial struggle, fought at length by skilled and careful practitioners of the highest quality. 5 No part of the appeal or the cross appeal concerned the form of declaration 1(b). The form of declarations 1(a) and (b) after the appeal (and the success of the cross appeal) were as follows (the changes in 1(a) made pursuant to the success of the cross appeal being highlighted and marked): THE COURT: 1. declares that there was as at 23 December 1993, and still subsists, a binding agreement between the parties that: (a) subject to Ministerial consent being obtained, and for the purposes of expanding and operating the Sanctuary and building a residence and other necessary buildings thereon, a lease or other substantial exclusive grant without rental or fee be granted by the first and second respondents to the first applicant for the life of the second applicant in perpetuity over the area of Tipperary Station known as the Tipperary Wildlife Sanctuary, plus an additional area adjacent to the Sanctuary so that its total area is 20,000 acres; (b) no part of the Sanctuary so expanded is to include any part of the existing Tipperary Station homestead area or mango plantation but is to cover, as closely as a professional survey will permit, the land adjacent to the present Sanctuary (known as Stages I, II, III and IV) up to approximately the northern boundary of the paddock known as "Campbells" and west of the road as far as necessary to encompass (together with the existing Sanctuary area) 20,000 acres of the paddocks known as Turkey Flat, Little Gardener, Jumbo, Electric Fence and Boords; 6 The matter came before me again last year. It came to me because Einfeld J had retired from the Court. The parties were in dispute about the effect of declarations 1(a) and (b) in a respect which had not been, in terms, dealt with on appeal. The matter came to me in the original jurisdiction of the Court. 7 I will deal with the nature of the application and how it arose presently. I should say at the outset that I raised the question of whether I should hear the matter. Neither Drummond J nor Mansfield J had any objection to my dealing with the matter. I was originally contacted by the parties because of my familiarity with the facts. There was some suggestion at one point from the respondents (Mr Bakrie and his interests) that they may ask me not to hear the matter. No application to that effect was filed. I should say that although I raised the question initially, on reflection (and I made this known to the parties) I thought, and think, that there was no reason for me not to hear the matter, and every reason for me to do so, because of my familiarity with the background facts. Costs would inevitably be minimised by my familiarity with the facts, gained otherwise from forming impressions about witnesses. 8 Some further background is necessary to throw up the problem. The relevant part of the proceedings concerned the claims of Mr Anderson and his interests (vindicated before Einfeld J and the Full Court) that Owston Nominees No 2 Pty Limited (Owston) was entitled to the Sanctuary and other land totalling, in all, 20,000 acres. Mr Anderson had developed the Sanctuary in various stages: Stages I, II, III and IV. Paragraphs [4] and [5] of Einfeld J's reasons describe the Sanctuary and its development as follows: [4] The Sanctuary presently occupies an enclosed area of approximately 860 hectares (2500 acres) adjacent to and partly surrounding the homestead area on Tipperary Station. The Sanctuary was developed in stages. Stages I - III were mainly developed in the period between 1987 and the end of 1989 and Stage IV was developed in 1994. These various stages and their relation to the homestead area are shown in the map (page 5 of Exhibit A3) which is appended to this judgment. The stages can be briefly described: (a) Stage I comprises a hippopotamus enclosure with a man-made lake and a rhinoceros paddock, each of which was about 7 hectares in size, 6 animal breeding pens (each approximately 2.5 hectares in size), and an extensive, under cover, aviary. (b) Stage II comprises an area of approximately 250 hectares to the north of the Tipperary homestead area and borders the western side of the road which travels north from that area to the main road to Adelaide River and Darwin. It is enclosed by a brick and steel wall which is approximately 5 kilometres in length and stands more than 10 feet high. Where the wall crosses watercourses there are reinforced concrete culverts. The enclosure is designed to hold mega-vertebrates such as rhinoceros. Stage II also encloses a site for a substantial residence intended for Anderson himself. At present this site consists only of some foundations and a stockpile of building materials. (c) Stage III comprises an area of approximately 350 hectares to the north of Stage II and separated from it by a fenced "raceway" through which animals can be moved. Stage III is fenced with a cyclone wire fence some 12 feet in height and approximately 9 kilometres in length. The fence is anchored in concrete so as to prevent the entry of dingos or other predators by digging under the fence. Stage III has been further developed by the construction of a pygmy hippopotamus and tapir enclosure just to the north of the fenced area containing along the northern and western boundaries 22 fenced breeding pens, ranging from 2 to 8 hectares in size. This development took place in two stages: pens numbered 1 to 10 in 1991 and pens numbered 11 to 222 in 1992 and 1993. (d) Stage IV comprises an area of approximately 250 hectares to the west of Stages II and III and separated from them by the same raceway. Stage IV is fenced by approximately 4 kilometres of cyclone wire fencing in a similar manner to Stage III. [5] The Sanctuary is currently populated with approximately 1500 animals of about 29 species and 425 birds of about 54 species, most of which are rare whose survival as a species is endangered. All of them have been either bred in the Sanctuary or bought by Owston from sources overseas and in Australia. For example, Owston purchased the entire stock of rare and endangered species from Lord MacAlpine's private zoo near Broome between 1990 and 1992 for approximately $1.2 million. Although there have apparently been some sales of surplus non-endangered animals from time to time, it is not a profit-making or commercial enterprise. The current annual cost of running the Sanctuary is said to be approximately $250,000 to $300,000. [emphasis added] 9 These findings were based on affidavit evidence of Mr Anderson and a Mr Langham, a person who, like Mr Anderson, was closely familiar with the property; this evidence was not the subject of challenge. The map referred to by Einfeld J is attached, as Attachment A. I have placed further markings on another copy (coloured) of the map and that too is annexed, as Attachment B. 10 For present purposes, it is important to note from the above findings that Stage II of the Sanctuary was enclosed by a brick and steel wall over 10 feet high and that animals populated the Sanctuary (including, inferentially, Stage II). It must have been visually apparent to the primary judge that the substantial fence to which he referred, being the boundary of Stage II of the existing Sanctuary, ran in an WNW to ESE direction along the southern boundary of an elongated battle-axe shaped area marked on Attachments A and B in green immediately to the north of a black rectangle; the green area being below the word, letters and numbers "Stage II 250 ha". I have marked on another copy of the above map (a black and white copy - Attachment C) the placement of the above fence by use of a line and multiple arrows. The black rectangle represents the air strip. The green elongated battle-axe shaped area represents an area planted with mangoes. The white rectangle with a black cross represents a homesite for Mr Anderson. I have marked these on Attachment B. 11 I have also marked on Attachment B the site of other mango trees to the south of the airstrip. These are in two blocks to the west and south of the homestead complex, the general area of which is also marked on Attachment C. All the areas planted with mango trees (the green elongated battle-axe shaped area on the map within the boundary of Stage II, and the areas to the south of the airstrip) have the trees planted in regular lines as if planted in a "plantation". 12 All the above was plain to Einfeld J, who visited the site. 13 The dispute between the parties, now ventilated, concerns the area planted with mangoes to the north of the southern boundary fence of Stage II - on the elongated battle-axe shaped land to the ESE of Mr Anderson's home-site, being the green elongated battle-axed shape on attachments A and B. (I will henceforth refer to this as the Disputed Mango Land.) The dispute arises out of different interpretations given by the parties to the words of declarations 1(a) and (b). The respondents say the words "mango plantation" in declaration 1(b) effectively leads to the excision of the Disputed Mango Land from the declaration of entitlement to land in favour of Owston. On the other hand, the applicants say that the Disputed Mango Land was part of the Sanctuary dealt with in declaration 1(a) and what was excised from declaration 1(b) was the homestead and mango plantation outside the existing Sanctuary: that is that the prohibition on choice of land in addition to the existing Sanctuary, as described earlier, was as set out in 1(b). So, the applicants said, reference to "mango plantation" in declaration 1(b) was to be understood as referring to the land with mango trees to the south of the airstrip, not the Disputed Mango Land, because the Disputed Mango Land was within the existing Sanctuary.

The Nature of the Application 14 The current dispute crystallised in September last year when the second respondent (Tovehead) filed an originating motion for the recovery of land in the Supreme Court of the Northern Territory. The motion sought possession of the Disputed Mango Land. By consent, on the application of the applicants, these proceedings were stayed on condition that the applicants pursued an application in this Court for clarification of the orders with all due expedition. The application has not been without difficulty in its preparation. I have also sought to accommodate the availabilities of counsel who are familiar with the matter. I regard the applicants as having proceeded with all due expedition. 15 Each side filed a notice of motion to throw up the issue. First, on 21 October 2002, the applicants filed a notice of motion seeking, relevantly, a declaration: …that upon a true construction of declaration 1(b) made by Einfeld J on 11 September 2000, the words "mango plantation" where appearing in that declaration have no reference to the existing mango plantation contained within the existing boundaries of Stage II of the existing Sanctuary. I assume the "a" in the first line was meant to be "the". This was replaced by an amended notice of motion filed on 21 February 2003 seeking, relevantly, a declaration: … that the area of land known as Stage II, referred to in declaration 1(b) as being part of the present Sanctuary, is that area of land of approximately 250 hectares whose boundaries are formed by a brick and steel wall of approximately 5 kilometres in length and standing more than 10 feet high. The respondents filed a notice of motion on 4 February 2003 seeking the cross vesting of the applicants' motion to the Supreme Court of the Northern Territory. The respondents did not amend this notice of motion to seek removal of the amended motion filed by the applicants, but I will take it as having done so. 16 The orders of Einfeld J, as amended by the orders of the Full Court, have been entered.

The Relevant Principles Attending Changes to Entered Orders 17 Order 35 rule 7 of the Federal Court Rules sets out express exceptions to the general common law rule that once a judgment of the Court has been passed and entered, the Court thereafter lacks power to make an order which alters or sets aside that judgment. O 35 r 7 is in the following terms: 7(1) The Court may vary or set aside a judgment or order before it has been entered. (2) The Court, where it is not exercising its appellate or related jurisdiction under Division 2 of Part III of the Act, may if it thinks fit vary or set aside a judgment or order after the order has been entered where: (a) the order has been made in the absence of a party, whether or not the absent party is in default of appearance or otherwise in default and whether or not the absent party had notice of the motion for the order; (b) the order was obtained by fraud; (c) the order is interlocutory; (d) the order is an injunction or for the appointment of a receiver; (e) the order does not reflect the intention of the Court; or (f) the party in whose favour the order was made consents. (3) A clerical mistake in a judgment or order, or an error arising in a judgment or order from an accidental slip or omission, may at any time be corrected by the Court. (4) Sub-rule (2) shall not affect the power of the Court to vary or terminate the operation of an order by a supplementary order. [emphasis added] 18 There are certain exceptions to or limits upon or within, the common law rule referred to at [17] above. First, there is jurisdiction in a Court to construe or interpret an order. In Repatriation Commission v Nation (1995) 57 FCR 25, 33-34 Beaumont J said the following (with which Black CJ and Jenkinson J concurred) about this power: The rule in England is that when a judgment is clear as to its terms, not even the pleadings nor the history of the action may be utilised to construe the judgment contrary to its clear meaning (see Halsbury's Laws of England, (4th ed, 1979), Vol 26, p 273). Where, however, the judgment or order is ambiguous, it may be permissible to resort to extrinsic material, including the reasons for judgment, to resolve the ambiguity (see Gordon v Gonda [1955] 2 All ER 762 at 765, 768). A similar approach has been taken in this country. If, as in the case of a "speaking" order (see, eg, ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 at 262) its true meaning is "immediately plain", the terms of the order will speak for themselves. If this is not the case, the true meaning may be ascertained according to ordinary rules of construction (see Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483 per Windeyer J at 503; McNair Anderson Associates Pty Ltd v Hinch [1985] VR 309 at 311-2; cf. Kwikspan Purlin System Pty Ltd v Federal Commissioner of Taxation (1986) 86 ATC 4,602 at 4,605; Australian Energy Ltd v Lennard Oil NL (No. 2) [1988] 2 Qd R 230 at 232; Sharpe v Goodhew (unreported, Federal Court, Drummond J, 11 December 1992), at pp 10-12; Australian Securities Commission v Skase, (unreported, Federal Court, Drummond J, 13 January 1993) at pp 16-17. Under the ordinary rules of construction, evidence of surrounding circumstances is admissible to assist in the interpretation of an instrument if the language is ambiguous or susceptible of more than one meaning, but not admissible to contradict the language of the instrument when it has "a plain meaning" (see Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 per Mason J at 352). 19 Secondly, there is the slip rule, fraud, self execution and the power of the Court to make "supplemental orders". These matters were explained by the Full Court of this Court in Caboolture Park v White Industries (1993) 45 FCR 224 at 234-35 as follows: There is no doubt that the common law rule is that once a judgment of the Court has been passed and entered, the Court thereafter lacks power to make an order which alters or sets aside that judgment. The only remedy in such a case for a dissatisfied litigant is, where available, an appeal: Re St Nazaire Co (1879) 12 Ch D 88; Re Suffield and Watts; Ex parte Brown (1888) 10 QBD 693 at 697 per Fry LJ and at 698 per Lopes LJ; and cf Gamser v Nominal Defendant. The general rule admits to certain exceptions but these are, so the respondent submits "severely circumscribed". One such exception is the "slip rule": see L Shaddock & Associates Pty Ltd v Parramatta City Council (No 2) (1982) 151 CLR 590; another exception is fraud and a third relates to self-executing orders. None of these is relied on in the present case. Order 35, r 7 of the Federal Court Rules sets out exceptions to the general rule that the Court will not vary or set aside judgments. These examples largely reflect the common law position. None is here relevant. However, Caboolture relies upon what is said to be the power of courts to make supplemental orders where circumstances make it necessary so to do. That in an appropriate case a supplemental order may be made after judgment is entered, is clear from Preston Banking Co v William Allsup & Sons [1895] 1 Ch 141. The true principle was expressed in that case by Lord Lindley (at 143-144) as follows: "This is not an application to alter an order on the ground of some slip or oversight. Nor is it a case in which the order has not been drawn up. Here the order has been drawn up, and it expresses the real decision of the Court; and that being so, the Court has no jurisdiction to alter it. If this summons had proceeded on the theory that the order of the 11th of July was right, and that circumstances had since occurred which had rendered a supplemental order necessary, the Court might have entertained the application; but this summons proceeds on the theory that the order of the 11th July is wrong. In my opinion, it is of the utmost importance, in order that there may be some finality in litigation, that when once the order has been completed it should not be liable to review by the Judge who made it." Critical to the jurisdiction of the Court is first that the application not be one in any way to vary or alter the initial order. The present application does not seek to do this. It is, in the sense used in the cases, a supplemental order. 20 Though maintaining his primary position that the orders here were clear and meant what the applicants said, Mr Robinson put forward that there was a latent ambiguity in the orders or that a supplemental order (as recognised by O 35 r 7(4)) could be made or that the order fell to be analysed and dealt with by reference to the decision of Needham J in Gikas v Papanayiotou [1977] 2 NSWLR 944, to which I will come. Mr Kunç, on behalf of the respondents, for reasons to which I will come, propounded the primary proposition that the Court had no jurisdiction (that is, no federal jurisdiction) to make any order, but said that if some order were to be made it did not fall to be made as a supplemental order, but as one to cure ambiguity. Mr Kunç conceded, correctly, that if he were wrong on the question of jurisdiction, and if I found ambiguity in the order, I could, if so minded, make an order clarifying such ambiguity, bringing the orders of the Court into conformity with what was evidently intended by the primary judge. Though, as I understand his submissions, that approach would require a fresh proceeding, not the use of a notice of motion within these proceedings: in effect a "construction summons" would need to be taken out. 21 There was no disagreement with the proposition that the retirement of Einfeld J, of itself, was not fatal to any capacity in a Judge of this Court making orders in the original jurisdiction of the Court, should appropriately applied legislative provision or principle otherwise make that necessary or appropriate. That this is so is supported by the approach of Needham J in Gikas (in which Needham J made orders varying the terms of a decree in Equity made by McLelland CJ in Eq nine years earlier, by deleting certain words and substituting others in their place) and by Santow J in Ecrosteel Pty Limited v Pefor Printing Pty Limited (12 November 1997 unreported). 22 Writing extra-judicially, Young CJ in Eq wrote the following in (1998) 72 ALJ at 117 about the process of construction of an existing order of the Court or indeed another Court: Every so often, there appears to be an ambiguity in the orders of a court. When this occurs, if the court is functus officio, a summons seeking a declaration can be filed, see Young on Declaratory Orders (2nd ed), para1503. Surprisingly, there is little reported authority on the point, the most prominent example being Australian Energy Ltd v Lennard Oil NL (No 2) [1988] 2 QdR 230. On such a summons, the court can only construe the order, it cannot make the order it considers the original court should have made on the evidence. The order is construed according to the accepted applicable rules of construction so that, in the case of real ambiguity extrinsic material such as the reasons for judgment may be considered, Gordon v Gonda [1955] 1 WLR 885; 2 All ER 762; the Australian Energy case at 232 and Repatriation Commission v Nation (1995) 57 FCR 25 at 33-34. The Supreme Court is reluctant out of comity to construe an Order of the Federal Court where that court has jurisdiction to itself make a declaration, Fine Real Estate Network Pty Ltd v Howell (unreported, Supreme Court NSW, Young J, December 1997). Very often the problems of construction clear away because the solicitors organise things so that the construction summons comes before the same judge who heard the original proceedings. However, in Ecrosteel Pty Ltd v Pefor Printing Pty Ltd (unreported, Supreme Court NSW, Santow J 12 November 1997) this was not possible because the original order was made by an acting judge whose commission had expired. The judge applied the principles set out above, concluded that it was possible to construe two of the original orders in different ways and made a declaration as to which was the true construction in the light of the other orders made and the reasons for judgment. 23 Ambiguity is conceptually related to, but distinct from, what is covered by O35 r7(2)(e): where the order does not reflect the intention of the Court. The order may not do so if the words, as used, and as read one way, are such as not to express the intention of the Court. This may be so even if the judge thought that the order did reflect his or her intention. In these circumstances, more may be required than merely construing the order. The order may require amendment so that it may properly reflect what was intended by the Court in the first place. This is the circumstance that Needham J faced in Gikas. 24 In Gikas Needham J first examined the width of the power at general law to amend decrees passed and entered. He began with what was said by Lord Penzance in Lawrie v Lees (1881) 7 App Cas 19, 34-35: I cannot doubt that under the original powers of the Court, quite independent of any order that is made under the Judicature Act, every Court has the power to vary its own orders which are drawn up mechanically in the registry or in the office of the Court - to vary them in such a way as to carry out its own meaning, and where language has been used which is doubtful, to make it plain. I think that power is inherent in every Court. His Honour noted that this dictum had received wide acceptance, for example Re Swire; Mellor v Swire (1885) 30 Ch D 239, 243, 244, 245, 246 and 247. Cotton LJ expressed the principle in Re Swire at 243 as follows: But although that is the regular course, and it is only in special circumstances that the Court will interfere with an order which has been passed and entered, except in cases of a mere slip or verbal inaccuracy, yet in my opinion the Court has jurisdiction over its own records, and if it finds that the order as passed and entered contains an adjudication upon that which the Court in fact has never adjudicated upon, then, in my opinion, it has jurisdiction, which it will in a proper case exercise, to correct its record, that it may be in accordance with the order really pronounced. [emphasis added] Needham J noted that the House of Lords in Hatton v Harris [1892] AC 547 had expressly approved Re Swire, especially what had been said by Cotton LJ and that the Privy Council in Milson v Carter [1893] AC 638 applied Hatton v Harris. 25 It is unnecessary to set out all of the careful and precise analysis of the authorities undertaken by Needham J, as set out at pp 951-53. I gratefully and respectfully adopt that analysis. Needham J at 953 noted a distinction drawn by the New South Wales Court of Appeal (Herron CJ, Sugerman JA and Mason JA) in Coppins v Helmers; Brambles Constructions Pty Ltd (Third Party) (1969) 72 SR (NSW) 273 between cases (a) where the amendment is sought to give effect to the intention of the Court at the time the original order was made, and (b) where the Court is asked to correct an order by including in the original order a provision concerning a matter not dealt with at the hearing. In respect of the latter (where something is to be inserted which was not dealt with at the hearing) the Court of Appeal in Coppins noted that all the examples of courts making corrections concerned ancillary or consequential matters, not "substantial" questions. In respect of the former (where a change is necessary to reflect the intention of the court) no such limitation was expressed. (Indeed there is no logic to any such limitation to the power to bring the orders of the court into conformity with its intentions.) Needham J concluded that the decree in question did not reflect what McClelland CJ in Eq had decided. At 953-4 Needham J said: It seems to me that this case is in the same category as Re Swire (1885) 30 Ch D 239. In the judgment, McLelland CJ in Eq made a finding as to the assets passing to the defendants on dissolution of the partnership. In the decree that finding is limited by description. It is clear that his Honour did not, in his judgment, reach a conclusion as to what was included in "the assets forming part of and used in the carrying on of the business of Ashfield Dry Cleaners as it was being carried on on the 18th November, 1963", other than to include within those assets two motor vehicles. The short minutes and the decree descend to particularity and, in so doing, in my opinion, they include in the order something which the judge did not decide. In those circumstances, I think I have the power and, subject to any discretionary considerations, the duty to amend the relevant declaration as sought by the defendants. … The fact that the short minutes were approved by the judge is not, in my opinion, conclusive. It makes the task of the defendants harder, in that they must convince me that McLelland CJ in Eq, in approving the short minutes as reflecting his judgment, was in error. The defendants have so convinced me. It is common practice in this division of the Court, and has been so for many years, that the judge will announce his decision, and his reasons, and then direct the parties to bring in short minutes. It is understandable that, where a long period passes between judgment and the presentation of short minutes, room for error exists; whatever may be the reason for the error in this case, I am satisfied that error there was. 26 It should be noted that the matters varied by Needham J could not be characterised as "ancillary" or "consequential". 27 Thus, the common law appears to recognise, relevantly, at least four relevant possible bases for the exercise of power to deal with entered orders (i) ambiguity, invoking the need for construction, (ii) where the order does not reflect what the court decided, (iii) where something is to be added not dealt with by the court, which circumstance is probably limited to "ancillary" or "consequential" matters, and (iv) a supplemental order, the need for which arises from circumstances occurring after the order was made. (I leave aside the slip rule, fraud and self executing orders.) In respect, especially, of (i) to (iii) above, it is necessary to look at the surrounding circumstances. These include the reasons, the pleadings and, if necessary, the evidence and how the case was conducted: Australian Energy v Lennard Oil NL (No 2) [1988] 2 Qd R 230; Repatriation Commission v Nation, supra; Yates Property Corporation Pty Ltd v Boland (1998) 89 FCR 78; Hanave Pty Ltd v LFOT Pty Ltd [2000] FCA 388 at [6] and [7]; Ecrosteel Pty Limited v Pefor Printing Pty Ltd, supra; Re Muirhead; Ex parte Commonwealth Bank [1997] FCA 365; and Blacktown Concrete v Ultra Refurbishing (1998) 43 NSWLR 484, 491-2. The Full Court in Caboolture said that O35 r 7 "largely reflects the common law position". 28 The parties did not address the question as to the extent to which O 35 r 7 excluded the common law or the extent to which it could be seen as exhaustive of the Court's power to act in circumstances of this kind. I do not need to address these matters to resolve the present debate. 29 In some of the cases the phrase "inherent" power is used: see generally Mason "The Inherent Jurisdiction of the Court" (1983) 72 ALJ 449. In the light of the terms of ss 5, 19, 22 and 23 of the Federal Court of Australia Act 1976 (Cth), and the capacity of the Commonwealth Parliament by ss 71, 77(i) and 51(xxxix) of the Constitution to create superior courts of record with all necessary powers for the discharge of their functions (as to which see Re Macks; Ex parte Saint (2000) 204 CLR 158, 177-178 [19] to [23], 185-86 [51] to [53], 235-37 [214] to [220], and 247-48 [253] to [255]; Jackson v Sterling Industries Ltd (1987) 162 CLR 612; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380, 393-94 [25] to [26], 399-401 [41] to [44]; and Patrick Stevedores Operations (No 2) Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1, 29-30 [27] to [30], 32-33 [35]) such powers can be seen as implied within the power of the Federal Court granted by the above provisions and by its existence and status as a superior court of record. In this respect, see also Williams v Minister for the Environment and Heritage [2003] FCA 627 at [16] to [24] per Lindgren J.

The Respondents' Jurisdictional Argument 30 The fulcrum of Mr Kunç's submissions was that the question of the entitlement to the Disputed Mango Land was not part of the dispute before the Federal Court dealt with by Einfeld J and the Full Court. The Court had jurisdiction to quell a controversy containing allegations of contravention of s 52 of the Trade Practices Act 1974 (Cth). The controversy that had been brought to the Court for resolution had been quelled, it was said, by the completion of the litigation process in the Full Court. Now, so it was said, a separate and distinct controversy, naked of any federal element, had been uncovered. Thus, naked of a federal connection, the dispute about the terms of the contract between the parties it could only be litigated in a State or Territory Court: Re Wakim; Ex parte McNally (1999)198 CLR 511. 31 There is no doubt that the Court has jurisdiction to determine this question of jurisdiction: Re Macks, supra. 32 To appreciate the correctness, or not, of the above submission it is necessary to understand what was litigated and what was decided before Einfeld J. This analysis is, in large part, the same exercise that must be undertaken for the tasks referred to in [27] above.

The Hearing Before Einfeld J and the Scope of the Controversy 33 The applicant correctly pointed out that there were two major subject matters at the trial comprising the controversy that had been given its federal character by the alleged contravention of s 52: (a) the contractual grant of the 20,000 acres to Owston for the purpose of expanding the Sanctuary, and (b) the contract concerning the issue of the 40.815% of the shares in the first respondent (Branir) to Owston. The present difficulty relates only to the first subject matter. 34 The first subject matter was dealt with in declaration 1 and order 2. As is plain from the terms of the orders, the purpose of declaration 1 was to identify which land was Owston's and which land was not. Thus, as was conceded by Mr Kunç (as he necessarily was required to) the answer to the present difficulty (whether given by me or by the Northern Territory Supreme Court or by some other court) leads to the conclusion that either Mr Bakrie's interests or Mr Anderson's interests are entitled to the Disputed Mango Land. The originating process in the Northern Territory Supreme Court reveals that. It is an action for possession. No suggestion was made that any person other than Owston or Tovehead was entitled to the Disputed Mango Land. 35 The recognition that one of them (Owston or Tovehead) is entitled to the land makes very difficult, if not impossible, the primary contention of Mr Kunç, that Einfeld J was not dealing with this question. Such might have been more sustainable if the necessary effect of the order, on one or more or any contested version or versions, did not give the Disputed Mango Land to Owston or Tovehead. 36 I have already referred to [4] and [5] of Einfeld J's reasons (see [8] above). Before coming to his Honour's resolution of the matter, it is appropriate to see how the matter came to his Honour on the pleadings, and in the evidence. 37 The first prayer in the second further amended application before his Honour at the hearing was, relevantly, in the following terms: 1. A declaration inter partes that in the events which have happened Owston has the following rights: (a) the right to exclusive use and possession of such parts of Tipperary as are currently used by it for the Sanctuary; (b) the right to select further parts of Tipperary for its exclusive use and possession, provided that it may not select land which is, at the date of selection, developed land or commercial plantation or which would, taken together with the land referred to in (a) and land previously selected by it, exceed 20,000 acres in total area; (c) all such rights over the land referred to in (a) and land selected by it pursuant to (b) (the "Greater Sanctuary Area") as it would have if it were the lessee thereof in the terms of the underlying lease of the relevant part of Tipperary; (d) free and uninterrupted rights of carriageway, ingress and egress to and from the Greater Sanctuary Area in common with other users of Tipperary; (e) the right to use light, power and water from Tipperary; and (f) the right to use and occupation of two small staff houses on Tipperary. [emphasis added] 38 The structure thus imposed called for an investigation of (a) what was currently used for the so-called Sanctuary and (b) what could be "selected" in addition to the current Sanctuary in order to make up 20,000 acres (the so-called "Greater Sanctuary Area"). The application itself recognised a limitation upon that selection: there could be no selection of "developed land or commercial plantation". Thus, it is plain from the application that the excision of any "commercial plantation" was only from the further land to be selected to make up the 20,000 acres, in addition to the existing Sanctuary. 39 The second further amended statement of claim reflected this dual structure to the claims. The pleaded agreement said to have been made in late 1993 was, relevantly, to the following effect: 13. In late 1993, Tovehead and Branir represented to and agreed with Owston that - (a) Tovehead and Branir would allow to Owston the right to exclusive use of the Sanctuary and the further area referred to in the Statement of Understanding on the same terms as the underlying perpetual pastoral leases, with complete rights of access, at a nominal rent. The "further area referred to in the Statement of Understanding" was a reference to a document so-called, and also sometimes referred to as the Joint Statement of Understanding or JSU. This JSU was independently pleaded as the foundation of relief. The document was considered in some detail by Einfeld J: see [14] and [53] to [63], of his Honour's reasons, and contained, relevantly, the following: THIS STATEMENT OF UNDERSTANDING is made this 1st day of February 1990 WHEREAS: A. Agreement has been reached for Tovehead Pty. Limited ("Tovehead") to purchase from Owston Nominees No.2 Pty. Limited ("Owston"), a half interest in certain rural properties in the Northern Territory of Australia ("the land"). B. The parties intend to use certain parts of the land in accordance with this Statement of Undertaking. THE PARTIES STATE AS FOLLOWS: 1. USE OF LAND 1.1 Owston shall use such parts of the land as it selects, not exceeding 20,000 acres for its own purposes, including construction of a private zoo. 1.2 Tovehead shall use such other parts of the property as it selects, not exceeding 20,000 acres for its own purposes, including construction of a private residence. 1.3 Neither Owston nor Tovehead shall select, under 1.1 or 1.2, any of the currently developed land or commercial plantation. [underlining in original] [emphasis added] 40 Thus, whatever ambiguity may have lain latent within the terms of cl 1.3 of the JSU standing alone in this regard, set in the context of [1] of the application and [13(a)] of the statement of claim, there could be no doubt that the pleader was putting forward Owston's claimed rights in the land (a) being the land upon which the Sanctuary was currently conducted and (b), in addition and separately, further land to be selected, which further selection of land outside the existing Sanctuary was not to include "currently developed land or commercial plantation". 41 The defence to the statement of claim took up this question of selection in the context of [9] of the statement of claim, which had pleaded the antecedent agreement in the JSU. Paragraph 9 of the defence said, relevantly: (b) say that any right to select land referred to in the said Joint Statement of Understanding (which is denied) is limited to such land as is not developed land or commercial plantation at the time of its selection; (c) say that on the true construction of the Joint Statement of Understanding any land forming part of Tipperary Station which is at the time of its selection: (i) fenced; or (ii) cleared, ploughed, fertilised, seeded or has had one or more of the said activities conducted on it; constitutes developed land within the meaning of the said document; and (d) otherwise deny paragraph 9. 42 In this context Mr Anderson and Mr Langham gave unchallenged evidence as to the location of the existing Sanctuary. The Disputed Mango Land unarguably fell within the existing Sanctuary. Not a word of cross-examination or address was uttered or written propounding the proposition that there should be an excision from the land said to be "currently used… for the Sanctuary" (see [1(a)] of the application). 43 On the other hand, there was a significant contest about the area from which Anderson or Owston could select and the meaning and content of the limitation on selection in the phrase "currently developed land or commercial plantation". It is unnecessary to examine this fight in detail. The respondents' assertions reflected in the part of the defence referred to at [41] above were rejected by Einfeld J. Indeed, tellingly, the debate raged over the meaning of the phrase "currently developed land", not the phrase "commercial plantation". His Honour said the following at [157] to [159] of his reasons: 157. The JSU did not comprehensively set out either a detailed definition or the conditions of use of the Sanctuary area and there were and remain a number of issues to be dealt with to complete the matter. The first issue, which was the subject of a great deal of evidence during the course of the proceedings, was the method by which the 20,000 acres were to be selected and which parts of Tipperary could be selected. The only reference in the JSU to any particular parts of Tipperary was in clause 1.3 which stated that neither party was permitted to select "any of the currently developed land or commercial plantation". The respondents submitted that the phrase "currently developed land" ought to be construed as prohibiting Owston from selecting any land which had been cleared and prepared for cattle grazing. 158. In my view, the phrase does not carry this meaning. In the circumstances, it is clear that the clause was designed to prevent either principal from attempting to select and annex any part of the homestead complex for his own use. It will be remembered that Owston had spent in excess of $50 million developing this complex, which included vast accommodation, sporting and administrative facilities. The discussions at the time the JSU was drafted pointed to the fact that the respondents insisted on the inclusion of this clause to prevent precisely and only this occurrence. It should also be noted that, as part of the development of the Tipperary homestead complex, a large commercial mango plantation was added. The proximity of the words "commercial plantation" to the phrase "currently developed land" in the JSU establishes, in my view, that what was being referred to was the entire development around the homestead area in order to ensure that the current buildings and commercial operations at Tipperary were excluded from any subsequent selection of land. Accordingly, while this land must be excluded from the 20,000 acres selected by the applicants, the land to be actually chosen was as determined by oral agreement subject to more precise delineation and calculation. 159. I have previously referred to Anderson's identification of, and Bakrie's at least general agreement to, where the expanded Sanctuary area would be when the two men first met at Tipperary in 1989 to discuss the purchase and sale of the initial 50% interest. Although the area pointed to by Anderson has not been surveyed, I was told that it is thought to comprise approximately 20,000 acres. In my view it is a reasonable consequence of the agreement made at that time and reaffirmed several times later that this area - involving the paddocks known as Campbells, Turkey Flat, Little Gardner, Jumbo, Electric Fence and Boords - constitute what was agreed to be the expanded Sanctuary area as required to make up 20,000 acres subject to the area being professionally surveyed for this purpose. In my view, the agreement between the parties requires that the area be selected in one exercise and, apart from those areas not currently contiguous, that the land selected adjoin the current Sanctuary area made up by Stages I, II, III and IV. A single application will no doubt then be made for any necessary ministerial consent to a sub-lease or other grant of the entire Sanctuary area. 44 It was plain from the material and evidence before Einfeld J including the cross-examination and submissions, that the parties debated the issue as to the land from which Mr Anderson would be able to select the additional land, the boundaries of the land making up the 20,000 acres to the west and north of the currently existing Sanctuary land and the meaning of the words of limitation in the JSU - "currently developed land". There was no debate about what the words "commercial plantation" referred to. More importantly, there was no debate whatsoever as to what the current Sanctuary was. That was plain for the eye to see. It included the Disputed Mango Land. 45 A surveyor gave evidence and exhibited a map of the area of the relevant part of Tipperary Station. On it, by use of a practice of cadastral surveying, he placed an area of 20,000 acres, the southern boundary of which area represented by the existing Sanctuary area was the southern boundary of the Disputed Mango Land. There was no assertion by the respondents at the hearing that, whatever else may have been in dispute about this map, there should be an excision of the Disputed Mango Land from the area so identified. 46 One of the exhibits, R 40, was an extract from a Department of Lands Perpetuity Report. The extract was a diagram which I have annexed as Attachment D. By the line marked 80, it clearly identified the Disputed Mango Land as within the "owner's enclosure". 47 The fact that the case was fought to the end on the basis that the applicants claimed an entitlement of Owston to the current Sanctuary and in addition to that further land to be selected, up to 20,000 acres can be seen in the written submissions of the respondents before Einfeld J which included the following: 2.1 The first applicant seeks relief based on an alleged right to be granted a perpetual lease or, in the alternative, an exclusive perpetual licence of part of Tipperary together with the right to select further land to be added to that part of Tipperary already used as the Sanctuary. [emphasis added] The position could not have been, or be, plainer.

Resolution of the Contentions 48 Mr Kunç submitted that the question of the entitlement of Owston or Tovehead to the Disputed Mango Land was not debated and so was not part of the controversy. He is partly correct. There was no active debate; but that was because there was plainly no issue about the correctness of the proposition that the Disputed Mango Land was part of the current Sanctuary . There was also no issue about the terms of the claim by Anderson and Owston for the current Sanctuary (the claim in contract was disputed, but not what was being claimed). It was clear that the case was fought by everyone in accordance with the structure laid down by the pleadings - that the right to select further land and the content of the limitation on that right to select further land did not affect the nature or contents of the claim to the current Sanctuary. The claim to the right to select further land was in addition to the current Sanctuary. 49 In these circumstances, Owston's claim to the Disputed Mango Land can be seen to be part of its claim to the first part of the claimed land - the current Sanctuary. Though there was no debate over the existence of the Disputed Mango Land as being within the current Sanctuary, that does not detract from the proposition that as part of the current Sanctuary the Disputed Mango Land and Owston's entitlement to it was and were part of the first element of Owston's claims as to the land in question. The Disputed Mango Land was, in this way, at the heart of the overall dispute, though not the subject of individual debate. This was so, it would clearly appear, because it was beyond argument that the Disputed Mango Land was part of the current Sanctuary. 50 Thus, I reject the proposition that the entitlement to, and claim to possession of, the Disputed Mango Land were not part of the controversy. Such issues were at the heart of the controversy. The current dispute indicates to me that the controversy is not quelled. That is not to say that Einfeld J did not deal with the issue or that he did not intend to deal with the issue. 51 Declaration 1(a) sought to bring together in one paragraph elements of [1(a) and (b)] of the application which concerned the land claimed to be subject to Owston's entitlement, but did not deal with the exclusion referred to in [1(b)] of the application. That was dealt with in declaration 1(b). Einfeld J changed the structure, it would seem, in order that declaration 1(b) deal with the exclusion (to which he had referred in [158] of his reasons - see [43] above) and with the inclusions - the various paddocks referred to in declaration 1(b). 52 Unfortunately, declaration 1(b) does not clearly reflect what is pellucid from the pleadings, the evidence, the conduct of the hearing and the reasons - that the restriction on selection which included an inability to select "commercial plantation" had nothing whatsoever to do with Owston's entitlement to the current Sanctuary which included the Disputed Mango Land, and so had nothing whatsoever to do with Owston's entitlement to the Disputed Mango Land. 53 There is force in what Drummond J said in Yates Property Corporation Pty Limited v Boland (1998) 89 FCR 78 at 784-9 that: …[i]t is impermissible, … as well as being quite unrealistic, to attempt to read, that is, to understand, an order in isolation from the context of the reasons for it being made. The Full Court of the Supreme Court of Queensland, in Australian Energy Ltd v Lennard Oil NL (No 2) [1988] 2 Qd R 230 held that, in interpreting an order of a court framed in unambiguous language, regard should still be had to the reasons given by the Court for making the order because they form part of a context in which the order was made. The case for referring to the reasons for an order where there is any suggestion that order may be expressed in unclear terms is a fortiori. Nevertheless, it is plain that parties should not have to examine the entrails of a long proceeding to understand their rights and obligations (including potential liability for contempt). Ambiguity can be resolved by a construction summons. That does not detract from the power of the Court either under O 35 r 7(2)(e) or the common law, otherwise surviving, to making an order that would correct an existing order which, when read one available way, does not reflect the intentions of the Court. 54 As I said earlier, the Disputed Mango Land is either within or without the declaration of Owston's entitlement. If it is without, then the order was made contrary to the claims of the applicants, contrary to the evidence, without argument and contrary to what can be seen as the common ground of the parties that the Disputed Mango Land was within the current Sanctuary. 55 Read one way, declaration 1(b) has this effect. Rather than dealing with the entitlement of Owston in two stages (only the second having a right of selection with attendant limitations) declaration 1(b) deals with a combined body of land "the Sanctuary so expanded" and limits Owston's entitlements to that land by stating that it is not to include "any part of the existing Tipperary Station homestead area or mango plantation". 56 If that means that Owston is not entitled to the Disputed Mango Land, I am clearly of the view that Einfeld J did not intend that consequence when one has regard to the background to which I have referred. In the light of the background material, it is clear that his Honour was making an order to limit Anderson and Owston in their selection of further land, and seeking to put out of their power the ability to arrogate for themselves the homestead and the adjacent plantations around the airstrip and outside the current Sanctuary. 57 I think there is ambiguity in Einfeld J's orders. That ambiguity is clarified with an understanding of the history of the matter. It is clarified in the sense that I am completely confident as to what his Honour intended. Indeed, I do not think that there can be any doubt about it, once one has a grasp of the history of the litigation. My view about that, however, does not change his Honour's words. They are words which, absent agreement of the parties or an understanding as to what the case was about, lack precision and clarity. I am not to be taken as being, or as intending to be, critical, in the slightest, of his Honour in this respect. He may have thought - and he would have been reasonable in so thinking - that there could be no doubt that the "mango plantation" to which he was referring in declaration 1(b) was a reference to the plantation areas outside Stage II of the existing Sanctuary and to the mango areas adjacent to the homestead area and airstrip. 58 The orders, nevertheless, lack precision and clarity. On their face they may be understood to excise the Disputed Mango Land from declaration 1(a). The better view is that, read in the light of the material to which I have referred, they only excise "the existing Tipperary homestead mango plantation", which would not cover the Disputed Mango Land. 59 In the context of what has been a bitter and protracted litigious struggle, the orders of the Court should be clear and should reflect, without giving pause for thought as far as that is possible, what was intended by the Court. As presently drafted, the orders of his Honour do not so reflect what was intended by him with precision. 60 It was no doubt the intention of Einfeld J to make orders that, without ambiguity and with precision, declared Owston's rights to the Sanctuary as it currently existed and to select further land up to a total of 20,000 acres, with a limitation on that additional or further selection. The orders made did not unambiguously and with precision achieve that. 61 The power in O 35 r 7(2)(e) extends, it seems to me, to circumstances where the orders are doubtful or ambiguous and on one reading do not reflect the intention of the Court and on another reading do. I do not think that the power falls short of dealing with a circumstance that could otherwise be dealt with by a construction summons. The words of Lord Penzance in Lawrie v Lees (at [24] above) are apposite: "to vary them in such a way as to carry out its own meaning, and where language has been used which is doubtful, to make it plain. I think that power is inherent in every Court." [emphasis added] 62 The content of O 35 r 7(2)(e) should not be read more narrowly than this. 63 His Honour, no doubt, intended to be plain. With respect, he was not. I have power under O 35 r 7(2)(e) or from the impliedpower of the Court (see [29] above) to ensure that the Court's records and orders unequivocally express the intention of the Court. These orders do not do so now. That has caused considerable delay and expense. I will make an order, I hope, putting the debate to rest and putting the issue beyond doubt. 64 It is unnecessary for me to decide whether this course can be justified as a "supplemental" order under O 35 r 7(4). 65 I will hear the parties on the appropriate form of order. To avoid, if possible, unnecessary debate, I would be minded, subject to hearing the parties on the form of the orders, to make an additional declaration, numbered 1(bb) in the following terms: "the land intended to be encompassed within 1(a) above includes all the land within the existing Stage II of the Sanctuary, that is an area of land of approximately 250 hectares enclosed by a brick and steel wall of approximately 5 kilometres in length and standing approximately 10 feet high and that the exclusion of land from the "Sanctuary so expanded" as referred to in 1(b) above does not in any way affect, and is not in any way intended to affect, the first applicant's entitlement under 1(a) above to all land within the existing Sanctuary including land within the boundaries of Stage II as above described that has mangoes planted on it, such that the effect of 1(a), 1(b) above and this order is that the 20,000 acres to which the first applicant is entitled includes Stage II of the Sanctuary, the boundaries of which are marked on the map annexed hereto. 66 The parties can prepare an appropriately clear map. 67 I will dismiss the respondents' application to cross vest the proceedings to the Supreme Court of the Northern Territory. 68 I will hear the parties on the appropriate form of other orders, including the appropriate form of order as to costs. I certify that the preceding sixty-eight (68) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop.

Associate: Dated: 27 June 2003 Counsel for the Applicant: D Robinson

Solicitor for the Respondent: Blake Dawson Waldron

Date of Hearing: 21 February 2003 and 10 June 2003

Trade Practices Act 1974(Cth)s 52

Owston Nominees No 2 Pty Limited v Branir Pty Limited

At a glance

Court

Decision date

Before

Source

Judgment (9 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (17)

Cited By (16)