Plankton Australia Pty Limited v Rainstorm Dust Control Pty Limited

Federal Court of Australia (Full Court)|2018-11-21|Before: Farrell JJ

Counsel for the Applicants: Mr GA Sirtes SC with Mr B Le Plastrier

Counsel for the Respondents: Mr SK Dharmananda SC with Mr WCJ Zappia

Solicitor for the Respondents: HWL Ebsworth Lawyers

PLANKTON FARMS PTY LIMITED ACN 603 140 889 Second Appellant

AND: RAINSTORM DUST CONTROL PTY LIMITED ACN 003 646 160 First Respondent

JUDGES: MCKERRACHER, REEVES AND FARRELL JJ DATE OF ORDER: 21 NOVEMBER 2018

The appeal be dismissed.
The appellants pay the costs of the respondents, to be assessed if not agreed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

SUMMARY 1 The appellants appeal a judgment following an urgent trial by which the primary judge rejected their contentions that Plankton Australia Pty Limited ACN 144 578 852 had concluded an enforceable contract with the first respondent, Rainstorm Dust Control Pty Limited ACN 003 646 160: Plankton Australia Pty Limited v Rainstorm Dust Control Pty Limited [2018] FCA 174. The primary judge also dismissed causes of action claiming that Rainstorm and its officers had participated in misleading or deceptive conduct and/or were estopped from denying the existence of the legal relations for which Plankton contended. 2 The primary judge conducted a detailed analysis of the contemporaneous written communications between the parties and others with whom they dealt. His Honour also took into account the content of affidavits in support filed by the parties. He had the usual benefits of observing evidence adduced during cross-examination. 3 The primary judge considered that the parties were in serious negotiation, intended to create legal relations, expected at relevant times that they would create legal relations, but had not reached the necessary consensus required to establish a contract. 4 The claims in misleading or deceptive conduct and estoppel turned, not only on communications between the parties, but also on communications with others with the knowledge of the parties. Again, the primary judge conducted a detailed examination of all the facts and circumstances. For the most part, it was possible to reach a conclusion at trial without reliance upon credibility findings. There were, however, key aspects of oral evidence for Plankton which the primary judge rejected. By that evidence, Plankton sought to establish that the parties had orally completed all matters necessary (even accepting that some were outstanding) to reach a binding agreement. The primary judge stated his findings to this effect (at [101]): However, viewed objectively, what occurred in that conversation was a discussion about the aspect of the proposal then being considered that concerned the equity position in Algalfields, not the proposal as a whole. For the purposes of the proposal and ongoing discussions between the parties (and matters to be communicated to the Department of Lands to advance securing long term lease for the Site) the parties reached a consensus as to an 85%/15% split for equity in Algalfields. However, what was not communicated in the conversation was any final and binding commitment to the terms of the proposal which was, at that time, still a matter of discussion between the parties in anticipation of agreeing terms to be recorded in written documents. 5 Having rejected the oral evidence as going too far, the process of analysis by the primary judge turned, essentially, on the exchanged communications taken in the context of the dealings between the parties and third parties. On appeal, senior counsel for Plankton fully accepted that it would be necessary for this Court to conclude that the primary judge's finding (at [101]), was a finding which was "glaringly improbable": Robinson Helicopter Company Inc v McDermott (2016) 331 ALR 550 per French CJ, Bell, Keane, Nettle and Gordon JJ (at [43]). 6 We have carefully considered Plankton's arguments on each of the three causes of action but, for the reasons which follow, we are not persuaded that there was any error on the part of the primary judge. 7 As it was at trial, it is necessary to go into detail as to both the evidence and the analysis. The same material was examined on the appeal.

COMMON BACKGROUND 8 As at 2010, Aurora Algae Ltd leased a Site at Gap Ridge, near Karratha in the Pilbara region of Western Australia. At the Site there was a particular species of micro algae indigenous to Australia, known as Dunaliella selina algae (DSA), being cultivated in saline pools. Other algal species were also cultivated there. The Site was contained on two Crown leases. 9 The leases for the Site were due to expire on 26 April 2015. In April 2014, Rainstorm entered into an agreement with Aurora to take an assignment of the leases. Under this agreement there was a restraint upon Rainstorm using the Site for production of algae. However, Rainstorm's interest was not in algae cultivation, rather it wanted to use the ponds and other infrastructure to process waste bitterns, sourced from an adjacent land owner, Dampier Salt, into a dust control product. After entry into the agreement with Aurora, Rainstorm sought to transfer the leases and sought a new long term lease on the Site to commence upon the expiry of the existing leases. In due course, the existing leases were transferred to Rainstorm. 10 Mr Ian Tracton, the third appellant, controlled InterClinical Laboratories Pty Ltd, which was involved in DSA production at the Site prior to 2014. Mr Tracton also controlled Plankton. From April 2014, negotiations ensued between Mr Tracton, for Plankton, and Mr Robert Kerr, the managing director of Rainstorm, regarding arrangements for DSA production at the Site. Before those negotiations, Mr Tracton had approached Aurora concerning whether there would be any issue with DSA production (as distinct from other forms of algae production) on the Site. Despite the restraint agreed with Rainstorm, Mr Tracton was informed there would be no issue in relation to DSA production. 11 A Plankton subsidiary, Plankton Farms Pty Limited, the second appellant, was incorporated for the undertaking of the cultivation of DSA on the Site.

THE PRIMARY JUDGMENT 12 As indicated at the outset, Plankton, Plankton Farms and Mr Tracton, contended at first instance that a legally binding Joint Venture Agreement was concluded between Plankton and Rainstorm in relation to activities on the Site, including the cultivation of DSA by Plankton and the production by Rainstorm of its dust suppression product. Plankton asserted that by the terms of the Joint Venture Agreement, amongst other things, Plankton and Rainstorm agreed to establish Algalfields Pty Ltd. Algalfields was to be a company in which Rainstorm and Plankton would be shareholders and which would hold the "master lease" in respect of the Site, granting sub-leases to each of Plankton Farms and Rainstorm. Importantly, the parties accepted that this could not occur without first obtaining the consent of the Minister for Lands for the State of Western Australia. 13 The primary judge noted that the issue in the proceeding was not whether Plankton and Rainstorm intended to create legal relations. His Honour accepted that they participated in a process of negotiation where the ultimate object was to conclude a contract. However, the principal issue, as his Honour saw it, was whether prior to the disavowal of the existence of an enforceable contract by Rainstorm in June 2015 the parties had reached a consensus of a kind that the law would regard as being an enforceable contract or, alternatively, whether Rainstorm had led Plankton to believe that such an agreement had been concluded and Rainstorm had acted in reliance upon that state of affairs. The primary judge discussed the relevant contractual principles (at [11]-[18]), referring to Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424 and a number of other cases. It is common ground that the principles cited were unexceptional and gave no cause for complaint to Plankton on appeal.

The history of dealings 14 His Honour then proceeded to trace the history of the parties' dealings in greater detail. As this background goes to the issues on appeal, we now record most of the primary judge's analysis. 15 The primary judge dealt first with Mr Tracton's prior connection with the Site. His Honour noted a business sale agreement had been reached in 2010 between Mr Tracton and InterClinical to purchase, amongst other things, all of the stock of dried product that had been produced from DSA cultivated on the Site. InterClinical supplied customers with that product over subsequent years, with the stock running down by 2014 and, by the time of trial, the stock was very low. It is only possible to grow DSA at a handful of locations throughout Australia. Mr Tracton was interested in acquiring the leases for the Site when the opportunity arose because of the existing infrastructure and his past connection with the Site, but did not have the funds to do so. 16 His Honour then turned to the parties' initial dealings, noting that on 4 April 2014, Mr Tracton contacted Aurora, the former lessee of the Site, indicating that Plankton was keen to work with the new owners of the Site for the production of DSA. 17 Rainstorm wrote to Mr Murray Raven, the manager for the Pilbara region at the Department of Lands, on 8 April 2014 seeking the transfer of the Crown leases for the Site to Rainstorm. The letter also advised that Rainstorm wished to make a formal application for a long term lease of the land to be used for manufacturing dust suppression products and conducting an aquaculture business to commence immediately following the expiration of the then existing lease. The letter concluded with a paragraph saying: Finally, as you know, the Leases expire in April 2015. Leaving aside the issue of Aurora's application for Ministerial Approval to the transfer of the Leases to Rainstorm, Rainstorm wishes to make a formal application for a long term (30 years would be ideal) lease of the Land for the purposes outlined above, which lease would commence immediately following the expiration of the current term of the Leases. I would appreciate your assistance and advice on what is necessary to initiate this process. 18 Three days later, on 11 April 2014, Aurora informed Mr Tracton that it had no objection to InterClinical and Plankton operating to produce DSA at the Site. In late May, Mr Tracton sent an email of 27 May 2014 to Mr Kerr advising that, further to discussions, they were keen to finalise arrangements with Mr Kerr to continue to use the Site at Karratha for the growth and harvesting of micro algae, to which Mr Kerr responded that he was "knocking up some suggested wording for you to put onto your letterhead". Mr Kerr went on to invite Mr Tracton to "amend as you feel fit", but requested that he get it back "ASAP as I need to get my email off to the Ministry of Lands with some urgency". 19 A further email was sent on the same day by Mr Kerr to Mr Tracton setting out the draft terms of the letter to be sent out by Plankton to Mr Raven. It commenced with: As discussed, competing parties are trying to overturn the deal Rainstorm struck with Aurora on the grounds that we don't have a 'big enough' aquaculture component to our proposed use of the leases. It continued by requesting "a letter on your letterhead stating something along the lines of: …". The draft terms of the letter were then set out. The primary judge concluded (at [30]) that this early communication revealed a concern on the part of Mr Kerr that the transfer of the leases of the Site might not be approved by the Minister unless it could be demonstrated that the Site would be used for substantial aquaculture activities. Further, according to the primary judge, it revealed that Mr Kerr considered that an arrangement with Plankton would assist Rainstorm in securing a transfer of the leases. 20 Mr Tracton responded to Mr Kerr's email, attaching a draft letter for him to forward to the Western Australian Government regarding finalisation of the new leases required for the Site. The attached letter, subsequently sent to Mr Raven, included the following passages: [Plankton] and [Rainstorm] have a mutual interest in the use and development of [the leases for the Site] for the conduct of aquaculture and related activities. [Plankton] in [sic] involved in the growth, harvesting, development and research of the micro marine species Dunaliella salina. … It is anticipated that the complementary nature of both company's [sic] businesses will mean full utilization of the potential of the lease sites, provide employment in the Karratha and Pilbara area and bring in export dollars to Australia. Myself and key personnel from [Plankton], along with key personnel from Rainstorm are intending to fly to the site within the next few weeks to inspect the facilities so the arrangement between Rainstorm and [Plankton] can be finalized. We see the site as a unique opportunity to maximize the value of the existing algae production infrastructure, which will allow us to relocate our existing business development plans from Queensland to Western Australia and would appreciate any assistance in finalizing the lease transfer to Rainstorm, so we have a legal basis to finalize our own sub-lease arrangement with Rainstorm. 21 The primary judge noted (at [33]) that he could be confident that at that time no agreement had been concluded (nor had it been so pleaded) and that the parties were in discussions about a sub-lease arrangement between Rainstorm and Plankton. Plankton takes no issue with this finding. At that time, the prospect of such a sub-lease arrangement was being presented to the Department to support Rainstorm's application for a long term renewal of the leases of the Site. The primary judge noted that what the letter did reveal was a perspective that it was necessary to finalise the position of Rainstorm in respect of the lease of the Site before any sub-lease arrangement with Plankton might be concluded. 22 An email of 27 May 2014 from Mr Kerr to Mr Raven, followed a discussion which appeared to have transpired between the two. It included the following extracts: As discussed on the phone, when Aurora Algae put out the remaining period of its leases to tender, there were 5 or 6 companies bidding. [Plankton] actually outbid Rainstorm, Murujuga and the others but did not have financing in place at the time so subsequently the deal was made with Rainstorm. Since that time, Rainstorm and [Plankton] have been negotiating arrangements for both companies to share the site. Rainstorm with its bitterns processing and aquaculture supplements business while [Plankton] would expand its existing business of growing salt water algae … The ponds and facilities which [Plankton] require are not required by [Rainstorm] and the infrastructure required by [Rainstorm] is mostly not required by [Plankton]. Rainstorm has already purchased all the physical assets onsite but are still waiting for the actual transfer of the lease(s). There might need to [be] a bit more pondage constructed but that is one of the issues I'm discussing with [Mr Tracton] of [Plankton] later this week when he flies in from Sydney. In the following weeks, representatives of both companies will be flying to the site to finalize the sharing arrangements. Unfortunately, with the unexpected hitch in transferring the lease to Rainstorm from Aurora, we aren't in a legal position to finalize any contracts with Australian Phytoplankton. And, naturally, any long term commitments between the two companies will depend heavily upon Rainstorm securing the long-term lease after the exploration of the current lease held by Aurora. (Emphasis added.) 23 The primary judge was satisfied that the reference to "Australian Phytoplankton" appeared to have been intended to be a reference to Plankton. Significantly to his Honour, this contemporaneous communication was also consistent with an approach whereby the finalisation of any contracts was to abide the outcome of dealings with the Minister to secure a long term lease. 24 A few days later, on 30 May 2014, Mr Kerr emailed Ms Erin Kelly, which appeared to his Honour to be to a Department of Premier and Cabinet email address, which included the following content: I thought it would be timely to let you know, that myself and [Mr Tracton] of [Plankton] have agreed on arrangements to share the facilities at the Aurora Algae site. Mr Tracton first contacted me 2010 looking for sources of bitterns … when Rainstorm signed the lease transfer agreement with [Aurora], I intended to discuss with Mr Tracton whether his companies ([Plankton] and [InterClinical]) would be interested in utilizing the algae growing infrastructure on the site. I had intended to finalize the lease transfer and extensions first before commencing negotiations with Mr Tracton, however, given the current circumstances and the passing of time I initiated contact fairly recently. Yesterday, after initial telephone and email discussions, Mr Tracton flew to Perth and we have agreed that the arrangement is viable and mutually beneficial. Perhaps, most importantly to the Ministry of Lands, our arrangement now provides continuity of the original lease requirements for aquaculture over and beyond Rainstorm's own activities in that space. 25 His Honour considered this email to paint a slightly different picture than earlier communications, for it suggested that arrangements to share the facilities had been "agreed". However, the primary judge said (at [39]): Importantly though, no claim is made by Plankton Australia that an enforceable contract was concluded between the parties at this time. Mr Kelly deposed that the original arrangement he discussed with Mr Tracton was that Plankton Farms would be incorporated and Rainstorm would sub-lease the algal growing portion of the Site to Plankton Farms for an annual fee of $200,000 or, in lieu of lease fees up to 20% equity. This appears to be the nature of the "arrangements to share the facilities" that were agreed at this time. 26 The primary judge noted that in early June 2014 Mr Kerr sent an email to the Pilbara Development Commission (PDC). That communication was in very similar terms to the email to Ms Kelly. It concluded with a statement to the effect that Rainstorm and Plankton had agreed on arrangements to share the facilities at the Site. That email was copied to Mr Tracton. Mr Tracton agreed that the discussions he had with Mr Kerr at that time were about Plankton becoming a sub-lease-holder and that no binding agreement had been reached at that point. He accepted that the detail was still to come. The primary judge said it was, nevertheless, evident that the parties described the outcome of their early discussions as an "agreement", albeit not a binding one at law. 27 Mr Tracton gave unchallenged evidence about a meeting that he attended with Mr Kerr and Dr Ken King, the Chief Executive Officer (CEO) of the PDC. Mr Tracton explained that during that meeting there was a conversation in which he said words to the effect that: Plankton and Rainstorm are currently in negotiations to secure mutually beneficial commercial agreements. Prior to finalising that agreement we will need to ensure that a new long-term lease for the Site is granted by the Minister. (Emphasis added.) 28 Mr Tracton also said that Mr Kerr responded that it was the intention of the parties that if Rainstorm was awarded a further long term lease, it would enter into a sub-lease for the duration of the period of the long term leases with Plankton. In the same month, Mr Tracton and Mr Kerr continued discussion in relation to coexistence on-site. A point came when Mr Tracton was not willing to advance negotiations further and disclose his business plans until Mr Kerr signed a confidentiality agreement. There was some minor tension in that it was put to Mr Tracton that he was not prepared to take Mr Kerr at his word in wanting a formal legal document about confidentiality. Mr Tracton responded that he had only known Mr Kerr for about three weeks. A formal confidentiality agreement was executed. 29 The primary judge said the fact that at the instigation of Mr Tracton the parties recorded their confidentiality agreement in a formal manner provided some context to their ongoing dealings and the extent to which it was likely that they may have contemplated that a legally binding agreement may be reached between them concerning activities at the Site without the terms being recorded formally in writing. Implicit in this observation by his Honour was that the insistence of a formal agreement as to confidentiality suggested that the parties would expect a formal agreement over the more substantive issues. 30 In the course of this month, there were two further exchanges. On 19 June 2014, Plankton and Rainstorm entered into the confidentiality agreement, reciting that each party had agreed to provide the other access to confidential information "as a pre-requisite for the provision of developing a new on-going business relationship between the parties". On 24 June 2014, a letter was sent to the PDC on the letterhead of Plankton, but signed by Mr Tracton, Managing Director of Plankton and by Mr Kerr, Managing Director of Rainstorm. Reference was made to a meeting "in Karratha last week" confirming a number of points, including: 4. Rainstorm will be taking an equity position in [Plankton's] farming arm. The details of the equity arrangements cannot be completed until the new long-term lease arrangements for the site is [sic] finalised. 5. When Rainstorm is awarded a suitable long-term lease, [Plankton] will be granted a lease of the same duration for the purpose of algae aquaculture farming. Due to the significant capital investments required for algae aquaculture farming and production, a long-term lease arrangement is vital to the project being viable. … 7. Once the leases are in place, [Plankton] algae growth and production will occur in the Pilbara Region rather than North Queensland, as originally planned. (Emphasis added.) 31 At the conclusion of the letter, the parties said "[w]e hope to finalise all leasing arrangements as soon as possible to maximise the current growth season which commences in August". 32 From this correspondence, the primary judge (at [48]) thought it significant that the letter contemplated that the completion of the details of the equity arrangements as between Plankton and Rainstorm after new long term lease arrangements for the Site had been finalised. It was indicative of the order in which things were to occur. 33 In the following month, on 14 July 2014, the Department informed Mr Kerr (and Aurora) of the Minister's consent to the transfer of the two leases. Whether those leases, which were to expire in April 2015, would be renewed remained an outstanding question. Mr Tracton was not copied in on this communication. 34 Late in that month, Mr Tracton commenced steps to engage Mr Owen Bunter to carry out certain works for Plankton on-site. Mr Tracton and Mr Kerr, in due course, agreed to split the cost of Mr Bunter for the period between August 2014 and the beginning of December 2014. Plankton took occupation of the Site at the beginning of August 2014 and incurred, thereafter, significant expenses associated with its occupation. Mr Tracton gave evidence that he went onto the Site to evaluate it for the purposes of re-establishing the algae farm, to work out how much it was going to cost to set it up and to do reconnaissance before finalising any arrangements. He accepted he also sought to show to Mr Kerr that he was genuine about his intention to set up an algae farm on the Site and that he anticipated that if he was able to showcase his abilities it would be easier to reach an agreement with Mr Kerr. The primary judge noted that also in August 2014 Mr Kerr raised with Mr Raven the possibility of a meeting with him and Mr Tracton to consider "the next phase of leasing" the Site. On 8 August 2014, Mr Tracton, having been sent a copy of an email from Mr Kerr to Mr Raven, emailed Mr Kerr in the following terms: FOOD FOR THOUGHT I believe if we work together as one enterprise, we will have the best chance of securing the future tenure of the site. My suggestion is that we set up a co-owned PTY LTD company for the lease renewal. This company would be owned and backed by Greg Kerr from Rainstorm Pty Ltd and Ian Tracton from [Plankton]/[InterClinical] - a group of long-term, established and successful Australian company's [sic]. We need to give the new company an attractive name; eg; AQUATEN PTY LTD. If you are in favour of my suggestion, we can bounce this idea off Murray at our meeting in Perth. 35 It was noted that the reference to "Murray" was clearly a reference to Mr Raven. His Honour considered this appeared to be the first point at which there was a suggestion about the leases of the Site being taken over by a company in which both Rainstorm and Plankton had an interest. Until this stage, the communications reflected consideration only of a sub-lease from Rainstorm to Plankton's "farming arm", in which Rainstorm would take an equity interest. 36 The email was forwarded by Mr Kerr to his co-director Mr Tim Keenan, with the following email message: Ian is suggesting a co-owned company with no suggested structure. So it is odd to bounce ideas off of a blank wall. I understand that you were looking at a three prong strategy: 1) We go it alone. … [Rainstorm] owns the site and Plankton is a secondary lease owner. Plankton rents or purchases assets that it needs. 2) We partner in a co-owned company which owns the master lease. Plankton pays us $600k to own half the site. 3) We partner in a co-owned company which owns the master lease. Plankton pays [Rainstorm] or the new company a lease rate ($100k) a year. If we go into a co-owned company we need to protect our ownership of the long-term lease. I don't want to find [Rainstorm] in a situation where the other 50 percent share is up for grabs. It has to revert back to [Rainstorm] so we have 100 percent ownership. I don't know how to structure this. Need a lawyer to set the articles of the co-owned company. May be some type of 'First Right of Refusal' clause, but I don't want to colour the outcome of the structure. 37 His Honour was unclear from the communication between the directors of Rainstorm whether there had been some discussion of the possibility of the leases of the Site being held by a company in which each of Rainstorm and Plankton held an interest prior to the 8 August 2014 email or whether the discussion was prompted by the email. In any event, his Honour said that the sequence of events up until this point evidenced that the decision by Mr Tracton on behalf of Plankton to go onto the Site in August 2014 was not influenced by any belief that there was an agreement in place. 38 Mr Kerr deposed that in a meeting in or around late August 2014, with Mr Raven and Mr Tracton in attendance, Mr Raven said words to the effect that it would slightly improve chances of renewing the leases if the application for renewal was made jointly by Plankton and Rainstorm because it was anticipated that Plankton would be performing the aquaculture component of the permitted use of the leases with respect to the Site. Mr Kerr's evidence was that he asked "what would give the best chance of a new lease: an application in Rainstorm's name, a joint application by Rainstorm and Plankton?". Mr Raven responded with words to the effect "probably [a] joint [application]". Mr Kerr gave evidence that after the meeting he said to Mr Tracton words to the effect that he did not like the idea of the leases being jointly held, but if it was going to improve the chance of a new lease then "we would make a joint application". 39 The primary judge concluded that the chronology suggested that the prospect of the "master lease" being held by a company in which each of Plankton and Rainstorm held shares was being considered before the meeting with Mr Raven at which it was suggested that it would improve the chances if the actual application for renewal was made jointly by those parties. 40 Various on-site steps took place, as noted by the primary judge: (a) two generators were purchased to be shipped to the Site; (b) batches of algae were received from Flinders University; (c) plans were made to purchase fuel storage tanks for the generators; (d) steps were taken in relation to obtaining an aquaculture licence for production of DSA; (e) arrangements were made to have the existing centrifuges on the site sent off-site for service and any necessary repair; and (f) Mr Tracton communicated with a prospective customer on 20 October 2014 advising that he was well into setting up new DSA growth ponds to be used for commercial production and hoped to have some regular DSA concentrated slurry product available for sale in early 2015. 41 An email exchange of 30 October 2014 from Mr Tracton to Mr Bunter (copied to Mr Kerr), included the following: Please ensure these matters have been addressed and we will be soon ready for race upon culture growth: 1/ AquaCulture Licence: we need to ensure that we are compliant in all regards. We need to either have the previous Aurora aquaculture licence to grow Dunaliella salina (and other algae's [sic]) transferred over to [Plankton]. Alternatively, we can simply apply for a new licence … 2/ All growth ponds to be ready asap for our growing cultures, whereby all ponds have been washed out and flushed with clean sea water and cleaned of debris, with no artemia, shrimp or unwanted sea creatures remaining in any of our ponds, as they will eat and interfere with our growth cultures … … 3/ Ocean water and bitterns intake pumps require a filter, ie; to prevent artemia (etc) getting on to our site and into any of the ocean water retention, bitterns and growing ponds. … 4/ Ensure a raceway growth and all other production ponds and tanks are operational, with all pumps and water jets working properly. … 42 Mr Bunter replied with notations to the email, including: Working on this. The ERP's by and large are ready (with the above caveat) and electrically we should be okay. The final testing and re-commissioning of the ponds/raceways will not be able to be achieved until[:] a) The waste disposal system is back in place with waste water being directed to the evaporation ponds. b) The pumps to do so - re-installed. c) The methodology for the delivery and nutrient source (itself) is decided upon. The next major project being processing and re-configuration. a) This requires electrical and control work, pipe re-configuration, filtration and settlement systems and of course the centrifuge is to come back and be installed. 43 From this exchange, the primary judge concluded that these steps in relation to on-site activity taken went well beyond any notion of mere "reconnaissance". However, the primary judge noted that in his oral evidence, Mr Tracton was reluctant to accept that he had already committed to a commercial operation at the site by the end of October 2014. Nonetheless, as the primary judge noted, Mr Tracton by that time had caused these substantial steps to be taken at the Site towards producing DSA. They could not be said to have been taken pursuant to any agreement because it was not until the end of November, at the earliest, that Mr Tracton said that an agreement was reached, nor in reliance upon any representation as the alleged representational conduct relied upon by Plankton occurred after that time. 44 Rather, the primary judge found that Mr Tracton had a keen interest in producing DSA at the Site and was trying to demonstrate his capabilities to Mr Kerr. He needed a supply of DSA for when his existing stocks needed replenishing. The evidence before the primary judge was that by the end of November 2014, Plankton had spent about $200,000 on activities at the Site. 45 Key negotiations resumed in November 2014, with the parties engaging in negotiations about the terms on which Plankton or Plankton Farms might be allowed to cultivate DSA on the Site on an ongoing basis. His Honour inferred that the negotiations seemed to have arisen out of steps being taken to make a submission to the Department to support securing long term lease of the Site. 46 The evidence from Mr Kerr was that on the basis that Plankton and Rainstorm would be making a joint submission for a new lease, he began negotiating the terms to a potential long term agreement between the parties around November 2014. That appeared to commence from an email earlier in that month from Mr Kerr to Mr Tracton saying that he had been absolutely "flat out" for the last fortnight but intended to make a big push on the lease renewal in the coming week. Mr Tracton responded on 5 November 2014, saying: I also plan to re-visit the Crown Lease submission letter again tomorrow. The time is right - not to [sic] early and not too late. The lease still has about 5 months to run and lease renewals are usually done between 3-6 months prior to expiration. 47 On 13 November 2014, the Department sent Mr Kerr an email explaining that Mr Raven had taken long leave. The Department requested a concise submission, referring to a discussion of such a submission at a meeting with Mr Raven on 27 August 2014. 48 This resulted in Mr Kerr sending an email to Mr Tracton (copied to Mr Keenan) on 18 November 2014 saying: To summarize our discussion, this is how I see the structure coming together: • Algalfields Pty Ltd is formed as a holding company with 1,000 shares - 950 to Rainstorm and 50 to [Plankton][.] • Algalfields then provides to [Rainstorm] and to [Plankton] subleases of the same duration of the Algalfields Master Lease, I.e. 21 years for all leases. • The annual charge for each of the subleases will be 50% of the cost of the Master Lease (currently unknown) plus $2,000 to cover admin and ancillary costs[.] … There will be lots of cooperation between [Rainstorm] and [Plankton] because we have a joint vested interest in making the site work. Happy to talk this through further with you but ultimately, [Plankton] is going to get a heck of a good site with most of the expensive infrastructure already in place for algal production. We should each continue writing up [Plankton's] and [Rainstorm's] business plans for submission to the [Department] under the umbrella of a submission from Algalfields. I've asked my solicitor to begin drawing up some of the necessary documentations but even though it won't all be in place we'll have enough to tell the [Department] the general plan. I've attached one document already but more shall be forthcoming. 49 Attached was a consent to be executed by Plankton for it to become a member of Algalfields. It was proposed that Plankton would acquire a 5% interest in Algalfields, which would be the holder of the "master lease". Notably for the primary judge, the email did not link the summary of the discussion about the structure to the need for a joint company to improve the prospects of securing long term leases of the Site, rather it indicated a broader cooperative joint interest in making the Site work. 50 The primary judge observed that the 18 November 2014 email provided an important context for the communications which followed for two particular reasons. First, it referred to necessary documentation to be drawn up by Rainstorm's solicitor. Secondly, the statement was that even though all would not be in place there would be enough to tell the Department "the general plan". 51 Mr Kerr's email was forwarded by Mr Tracton to his solicitor, Mr Bruce Coode of Coode & Corry, with the following message: Hi Bruce, Please find attached my REVISED PROPOSAL for Greg at Rainstorm: Please add suggestions and comments. I want to send this document to him ASAP. Until we agree on the basis on our business arrangements, we cannot progress to the WA Crown Lease submission. Thanks, IAN 52 To the email was attached a completely reworded proposal headed "Revised Proposal Summary", commencing with the words "[f]urther to our discussions, I would like to propose the following …". 53 Then on 24 November 2014, Mr Tracton forwarded an email to Mr Kerr in the following terms: Please find attached my revised proposal. I hope you will find it fair and reasonable. Happy to discuss further. In the meantime, can you please forward me what you've prepared so far regarding the WA lease renewal submission document. This will assist me in completing my part. 54 It attached an expanded version of the Revised Proposal Summary document, concluding with a list of matters described as "Additional notes and clauses to be added into the agreements and company documents" (original emphasis of the primary judge). Subsequently, on the same day, Mr Kerr received an email from Mr Tracton with the subject "[Plankton] - how I want to complete the lease renewal presentation document and my Dunaliella selina promotional product information brochures". It said: I was working on our lease renewal presentation document over the weekend and it is driving me crazy. I have decided to employ a professional business proposal writer to help prepare the lease renewal submission document, which will include: business plan and outline, corporate identity profiles, background, product summaries, benefits to the community, WA and Australia, etc. It will be fast-tracked and ready within 2, 3 or 4 days. The cost will be between $500 and $700. I am happy to pay for it. If you send me what you've prepared, I will co-ordinate all the information accordingly so that we can quickly to have it finished [sic]. 55 It was certainly apparent, as the primary judge considered, that matters were proceeding with greater intensity at this point. The primary judge inferred that the parties considered there was a need to proceed with some urgency in providing a submission. Its preparation was being undertaken at the same time as there were discussions between the parties. 56 His Honour inferred that the context showed that the parties were engaged in discussions about their business arrangements and were also seeking to advance a submission to be provided to the Department. His Honour observed that there was no express language manifesting an intention to reach a concluded agreement. His Honour said, on the contrary, the document used language of discussions and the establishment of common ground. There were no invitations for particular terms to be accepted, agreed or concluded in some particular way. None of the proposal documents provided for the terms to be agreed or adopted by a signature on behalf of the parties. 57 Nonetheless, it is clear that a process of refinement was occurring. On 25 November 2014, Mr Tracton sent a further document entitled "Revised Proposal Summary (V2)" as an attachment to the following email: Further to our discussions, I have revised the proposal accordingly. In summary, the new trading/business company "[Plankton Farms]" could generate extremely high returns for all involved. This is a rare opportunity. In regards to Algafields as the leaseholding/management company - [Plankton] together with [Plankton Farms], as an ongoing trading/business concern, will add significant value to the overall worth and value of the crown lease. Please find revised proposal attached, as per our discussion. Please let me though [sic] your thoughts and comments. If this arrangement is suitable, I would like to work [to] having both new entities, ie; Algafields Pty Ltd and Plankton Farms Australia or [Plankton Farms] registered as WA companies. Kind regards and speak soon. 58 V2 expanded upon the section "Additional notes and clauses to be added into the agreements and company documents". 59 On the following day, 26 November 2014, Mr Kerr emailed Mr Tracton a marked up version of the Revised Proposal Summary that had been sent to him the previous day with a covering email stating that he had made his amendments and invited any comments or a phone call. The tracked changes included some further amendments to the section "Additional notes and clauses to be added into the agreements and company documents". It also changed the proposal to the shareholding in Algalfields to be held as to 85% by Rainstorm and 15% by Plankton. The earlier version had referred to 80% and 20% respectively. 60 This gave rise to an email from Mr Tracton to Mr Kerr on the same day saying: The proposal's looking good and taking shape. I am trying to cover as many contingencies as possible, so that we are all on common ground when moving forward. The last set of points was suggested by my accountant/business adviser. Please review the attached revised V4 proposal for discussion. 61 The primary judge emphasised two points: first, the reference to points suggested by Mr Tracton's "accountant/business adviser"; and, secondly, the invitation to engage in further discussion in respect of the attached version of the document. 62 Attached was 'Revised Proposal Summary (V4)", which added a section at the end of the proposal in the following terms: Further points for consideration: • Expenses and Income to be reviewed and emailed on a quarterly basis upon completion of each BAS with ATO … • Accounts to be reviewed yearly upon lodgement with ATO … (with Profit and Loss and Balance Sheet) • Dividend distribution to be at 25% (or whatever you feel is appropriate) of net profit after company has achieved $400,000 profit … estimated 2/3 years … Maybe put in a contingency to reconsider altering this percentage to a higher amount if feasible. • All other surplus funds to be reinvested in the growth of the company with worldwide plan of distribution … • All government grants and funding obtained remains in the company and is spent appropriately for business expansion and development … • All funds and surpluses to be advised on quarterly and planned spending budgets in Marketing, Research and development. etc. … • All these items need to be in the agreement (ie: shareholders agreement and the Memerandum [sic] of understanding) … 63 To this, the primary judge noted the following. First, the section was headed "points for consideration". Consistently with the course of communications in respect of the earlier proposals, this introductory language suggested to his Honour that the list contained additional items for discussion, not the finalised terms of a formal offer for acceptance. Secondly, the language used within the dot points was consistent with ongoing discussions. Thirdly, the final dot point, his Honour said, expressly contemplated that there would be a shareholders agreement and a memorandum of understanding to be prepared at a later stage. That language, together with the language about the notes and clauses "to be added into the agreements and company documents", viewed objectively by the primary judge, manifested an intention that any agreement was to be recorded in subsequent formal instruments comprising at least a shareholders agreement and a memorandum of understanding. 64 It appears to this Court that 26 November 2014 was a critical date. Mr Tracton deposed in an affidavit filed before the primary judge in relation to this email exchange of 26 November 2014: A short time after sending that email, I telephoned Greg Kerr and had a conversation with words to the following effect: I said: "Would you consider my amended proposal increasing the equity position in Algalfields?" Greg said: "No. What I emailed yesterday is the deal. That's it." I said: "Okay, I can live with that. Well let's move forward with it then. What do we need to do in relation to the WA crown for the master lease." Greg said: "We need to finalise the dossier for them." I said: "Okay. Well I will get my business writer to write it up for us so that it looks and reads well." Greg said: "Okay. Great." 65 There was some doubt as to precisely when this occurred, but the primary judge noted there was no real dispute it occurred within one day of V4 being circulated. 66 Although Mr Tracton deposed to his understanding based on that conversation and email that Plankton and Rainstorm had entered into a Joint Venture Agreement, Mr Kerr deposed otherwise. Mr Kerr said the proposals from each side were never agreed and did not result in a legally binding agreement. He subsequently deposed that he never communicated to Mr Tracton that Rainstorm offered to enter into an agreement with Plankton on the basis set out in the emails exchanging the proposals, nor that Rainstorm accepted the terms of the proposals. Mr Kerr said "[t]he only thing I told Ian [that] Rainstorm would do is make a joint application for the new lease". 67 Mr Tracton was cross-examined and re-examined about this discussion. During re-examination Mr Tracton said: The - a phone call that I made to Greg regarding the proposal agreement negotiations that were on 26 November asking him about the one - one major point, being the - the percentage breakdown of Algalfields, and I was requesting - I was agreeing with him. He - he gave me a final proposal. I'm saying to him, "look, I'm happy with everything in there. Would you consider twenty percent for Plankton Australia rather than 15 percent?" Greg said: "No. My final proposal is what I've offered you there" and I said, "Alright. Well, I - I'm happy with that. Let's - what do we have to do to move forward? Do we agree on this?" "Yes" both parties agreed and - and we - we moved forward. 68 The primary judge rejected the version of events recorded by Mr Tracton in re-examination in the following passages of his Honour's reasons (at [98]-[100]): 99 This version of the telephone conversation is materially different to that which Mr Tracton stated in his affidavit (quoted above). In particular, in his affidavits Mr Tracton at no point suggested that he asked Mr Kerr "Do we agree on this[?]" and Mr Kerr said "yes". The absence of any such evidence in his affidavit is striking because it is both the key conversation upon which the applicants rely in bringing their contract claim and it is the main factual issue in dispute in these proceedings. In those circumstances, I do not accept the evidence as to the version of the telephone conversation given by Mr Tracton in his oral evidence. I find that the evidence about the parties having agreed is no more than Mr Tracton's conclusion or characterisation of the consequence of the conversation and reflects the case that he advances in these proceedings. I mean no criticism of Mr Tracton in finding that the words "do we agree on this?" were not spoken by him and the response "yes" was not given by Mr Kerr. No doubt he now believes that an agreement was reached. However, whether there was a concluded contract that is legally enforceable requires a consideration of two separate matters. First, what did the parties actually say and do? Second, what is the correct legal conclusion to be drawn as to whether a contractual liability arose from those dealings? 100 I do accept that there was a telephone conversation between Mr Tracton and Mr Kerr after the V4 proposal. I do so recognising that there is some inconsistency as to the evidence of Mr Tracton as to precisely when that telephone conversation occurred. Mr Kerr accepted that it was possible that such a conversation occurred. Having regard to the course of the communications between the parties it is likely that such a communication occurred. As I explain below, subsequent communications by Mr Tracton and Mr Kerr with third parties referred to the shareholding in Algalfields as being 85% on the part of Rainstorm and 15% on the part of Plankton Farms. Indeed, information to that effect was included in the business case submitted to the Department of Lands shortly after the exchange of the proposals. Therefore, it is likely that it was the subject matter of a telephone conversation. Further, I find that the conversation was substantially in terms of that deposed to by Mr Tracton in his affidavit. 69 The primary judge did not find, based on an objective consideration of the evidence before him, that the parties reached a binding agreement. Importantly again we note his Honour observed (at [101]): However, viewed objectively, what occurred in that conversation was a discussion about the aspect of the proposal then being considered that concerned the equity position in Algalfields, not the proposal as a whole. For the purposes of the proposal and ongoing discussions between the parties (and matters to be communicated to the Department of Lands to advance securing long term lease for the Site) the parties reached a consensus as to an 85%/15% split for equity in Algalfields. However, what was not communicated in the conversation was any final and binding commitment to the terms of the proposal which was, at that time, still a matter of discussion between the parties in anticipation of agreeing terms to be recorded in written documents. 70 That led to his Honour accepting that the parties reached a consensus concerning the equity to be held in Algalfields, but not the oral evidence of Mr Tracton to the effect that there was communication of any agreement with respect to the matters addressed in the proposals being exchanged. Viewed objectively, his Honour considered the parties were taking care to record matters in a formal way as their discussions progressed and, in that context, it was most unlikely that the exchange of proposals concluded with an oral commitment. 71 Rather, his Honour said that the parties engaged in discussions for the purposes of reaching sufficient consensus to enable a submission to the Department. Otherwise, the question of finalising their agreement was held over until the outcome of the application was known. The parties proceeded on the basis that any agreement would be concluded once the outcome of the application to secure long term tenure of the Site was known. 72 Following what Plankton contends was the reaching of the Joint Venture Agreement, the parties made the Submission to the Department. On 1 December 2014, Mr Kerr and Mr Tracton each signed a joint letter to the Department. The letter confirmed that Rainstorm and Plankton had "a mutual interest in the commercial use and development" of the Site. The letter continued: As such, the two companies have agreed to form a partnership and have created a new business enterprise called, Algalfields … 73 Plankton emphasised, in particular, the words used in this sentence. 74 The letter attached the detailed Submission which recorded the following: In anticipation of the current leases expiring in April 2015, a new business entity named [Algalfields] has been created with joint ownership by [Rainstorm] and [Plankton] (Figure 1). As the incumbent leaseholder, Rainstorm is willing to relinquish its rights to apply for a subsequent 21 year lease … in favour of Algalfields doing so. In exchange, it has been agreed that Rainstorm shall gain a minority equity position in the newly formed [Plankton Farms] who will hold the Aquaculture Licenses and subsequently all commercial stakeholders will have an economic interest in both Rainstorm and Plankton Farms achieving maximum utilization of the site in continuing commercial success. … Plankton Farms and Rainstorm have a mutual and complementary interest in the commercial use and development of [the Site] for the conduct of aquaculture and bitterns related activities. To continue with the primary usage of the site, as well as working to expand and maximize the existing usage of site [sic] and improving its commercial viability, Algalfields will be the Master Lease holder and manager, see Figure 1. It is anticipated that the lease of the Site will be transferred from Rainstorm to Algalfields under a new Lease agreement with simultaneous approval being sought for Algalfields to sub-lease the Site to Plankton Farms and Rainstorm to conduct their respective complementary commercial activities. 75 The primary judge noted that Fig 1 depicted Algalfields as the "Lease Management Holding Company", with an ownership structure of Rainstorm as to 85% and Plankton as to 15%. It also referred to sub-leases to each of Plankton Farms and Rainstorm. It contained detailed explanation as to how the Site would be utilised by Plankton in cultivating DSA and Rainstorm in extracting bitterns. 76 On the same day, on 1 December 2014, Mr Tracton emailed Mr Kerr informing him that the "new company for the algae farming operations is now registered as Plankton Farms". 77 Also on 1 December 2014, Plankton Farms submitted an expression of interest (EOI) for State government funding under the "royalties for regions" project. Input into the EOI was provided by each of Mr Kerr and Mr Tracton. The EOI concluded with the following statement: To date Rainstorm has [spent] $1.2 M to buy the site and its infrastructure from Aurora Algae Pty Ltd. Rainstorm has spent further money on other site inputs and improvements. To date, Plankton Farms and [Plankton], on speculation, without any long term lease in place, have inputted $100,000+ in wages, equipment repairs and purchases, infrastructure modifications, laboratory set-up and so on. [Plankton] has three employees currently on the site. 78 Importantly, at this juncture, the primary judge noted a significant feature of his analysis of the relationship between the parties. An issue arose at trial as to whether the words used in the EOI and set out above were, in effect, a statement by Mr Tracton that his presence on-site was speculative, both as to the risk concerning a long term lease and a risk that the parties would not conclude an agreement. His Honour doubted that the words conveyed the latter, rather, his Honour said that the parties expected to conclude an agreement. They knew that there was uncertainty as to whether there would be long term leases. Part of what needed to be demonstrated was sufficient proposed aquaculture activities on the Site in order to justify a new lease for that purpose (being the purpose for which the existing lease of the Site had been granted). His Honour was of the view that it would be inconsistent with the evident purpose of the EOI to introduce doubt as to whether Plankton was likely to conclude an agreement with Rainstorm. His Honour accepted, however, that was not to say that there was, in truth, a concluded agreement at that point but rather the statement in the EOI simply did not address that issue. 79 This observation by the primary judge is telling. It is consistent with both parties' cases that at this point they expected to conclude an agreement. The real question was and is whether they had and whether they would. That summary, however, fails to encapsulate the case advanced for Plankton and the argument which it presses on appeal. Plankton contends that, not only did the parties expect to conclude an agreement, but that all important terms of that Joint Venture Agreement had been reached with the remaining aspects being mere detail. That is where the parties differ and differed at first instance. 80 On 3 December 2014, Mr Kerr sent Mr Tracton a form of consent for Plankton to become a shareholder in Algalfields. It was executed and returned and documents for the registration of Algalfields were also prepared. The company, however, never was incorporated. 81 Meanwhile, in early December 2014, activity continued on-site. The primary judge noted that on 9 December 2014, Mr Tracton followed up in relation to the centrifuges on-site stating "[w]e want and need them back in Karratha ASAP for our test productions (Dunaliella salina algae harvesting) commencing early in the new year". Plankton Farms employed Mr Bunter as general manager for the Karratha algal cultivation and production. 82 An email address was allocated to Mr Kerr for Plankton Farms in December 2014. 83 Mr Kerr emailed the Department following up the Submission, concluding: I know we took quite a while to get our submission in as it is of burning importance to us and we took forever to tweak and edit it. I'm not seeking to hold you to any specific date but we have spending, and more importantly, employment decisions to make and at this point we don't have any certainty beyond next April. 84 Throughout this time, Mr Bunter was engaged as the full-time general manager at the Site by Plankton Farms. Mr Bunter communicated by email with both Mr Tracton and Mr Kerr concerning steps occurring in relation to setting up the DSA production and progress of matters such as the aquaculture licence, the centrifuges and production trials. 85 His Honour then turned to dealings and exchanges between the Department and Mr Kerr and Mr Tracton commencing in early 2015. These communications with the Department were not in accordance with the parties' requests in that the Department emailed Mr Kerr and Mr Tracton, on 8 January 2015, stating that it was prepared "to refer the issue of a new lease to appropriate agencies for comment and approval", but on 12 January 2015 the Department followed up with a further email in the following terms: Further to my email below and as discussed with Greg last week - if the Minister for Lands agrees to the issue of a new lease as per your application, it is the Department of Lands preference that the new lease be issued to the current leaseholder [Rainstorm]. Subject to the approval of the Minister for Lands (under delegated authority), the lease could then be transferred as required. (Emphasis added.) 86 The Department subsequently prepared plans in relation to the area essential for the proposed business activities and the Department sought confirmation that there was no objection to the new lease, if approved, being issued to Rainstorm. The communications from the Department went to both Mr Kerr and to Mr Tracton. 87 There was ongoing activity by Mr Bunter in particular in the early months of 2015 but, in any real sense, there was quite a hiatus in terms of finalising agreements until a communication on 21 May 2015 from Mr Tracton to Mr Kerr. Mr Tracton sent a document headed "Heads of Agreement", which was an amended form of the V4 proposal, commencing with the following words: For current on-going business, subsequent shareholder agreements and basic memorandum of understanding Based upon mutual discussions and email correspondence to date Creating a strategic operating alignment for specific business arrangements between Rainstorm and [Plankton] 88 The primary judge noted, unlike the proposal documents exchanged in November 2014, at the end of the document there was provision for signature by Mr Kerr on behalf of Rainstorm and Mr Tracton on behalf of Plankton. This met with an immediate response from Mr Kerr indicating that he had received the draft Heads of Agreement and saying "[w]e're going to have to have a serious talk about the role of Algalfields and the Master Lease". 89 Mr Tracton sent a draft of the EOI on the following day to various parties, including Mr Kerr. This document contained the following content: In 2014 Plankton Farms was formed for the purpose of subleasing the Karratha Site from its new leaseholder, Rainstorm Dust Suppression Pty Ltd … to farm, harvest and produce the Dunaliella salina biomass. Rainstorm will contribute to and invest in the Plankton Farms Project, by way of providing the use of the existing site infrastructure … The joint partnership between the two successful entities, [Plankton] and Rainstorm, augers well for commercial success of the Plankton Farms initiative. 90 It also contained a figure described as "Relationship Structure", by which Rainstorm was also described as the "Site Leaseholder". Otherwise, the language used in the figure appeared to reflect the terms of the request made by Mr Kerr in his email of 15 May 2015 where he queried the need to refer to Algalfields and expressed a preference that the quantum of what Rainstorm paid to Aurora be omitted. The draft submission also contained the following content: Plankton Farms via it's [sic] holding company [Plankton] - will be contributing an estimated $1.5 million in cash and kind into the project. Plankton Farms and [Plankton], on speculation, without any long term lease in place, have invested over $400,000 in wages, equipment repairs and purchases, infrastructure modifications, laboratory setup and site development. Plankton Farms has fulltime employees currently on the site to assist the setup of the Plankton Farms Project. … To date Rainstorm has invested the capital to secure the leasehold and the existing site infrastructure from Aurora Algae. The value of the leasehold and replacement cost of the existing site infrastructure is estimated at $5 million… (Emphasis added.) 91 The primary judge said that the language used in this document referring to "on speculation" appeared to be an updated version of the language that had been used in the EOI. Later, on 27 May 2015, Mr Kerr, Mr Keenan and Mr Tracton all met in Perth. The unchallenged evidence of Mr Keenan before the primary judge as to the events of that meeting was that "Greg" (referring to Mr Kerr) said the Department had rejected the proposal for the lease to be in the name of Algalfields and, therefore, the lease was going to be in Rainstorm's name. Mr Keenan's evidence was that, as a result, Rainstorm was prepared to revert back to the original proposal of Rainstorm giving a sub-lease to Mr Tracton's company and that the parties would need to negotiate the terms of that deal.

The dispute comes to a head 92 Two days later, on 29 May 2015, Mr Tracton emailed Mr Kerr saying: Continuing on from our conversation in Perth, I understand that you and I have an arrangement/agreement in place. We made a deal and have been working together as a team. We negotiated a business arrangement based on receiving a renewal and new lease for the site. In November, 2014, this agreement was confirmed through various discussions and emails. On December 4, 2014, we jointly made a formal submission to the W.A. Department of Lands based on those discussions. When you told me in Perth this week that things have changed - I don't know what. Our business arrangements were put in place 6 months ago. Algalfields and Plankton Farms were created accordingly. As consideration, I have put a substantial amount of monies into our business project to date. I have put 110% effort into everything to value add and ensure you, (ie; Rainstorm) and me, (ie; [Plankton]), would be able to secure a future lease for the site. I have really enjoyed working with you to date and look forward to a mutually successful and rewarding future. 93 However, in contrast, on 5 June 2015, Mr Kerr responded as follows, indicating the difficulties between the parties, saying amongst other things: The return to the original plan where Rainstorm owns 100 percent of the main lease, and Plankton receives a sublease from Rainstorm seems to have been a surprise to you. We are only going back to the original agreement where Rainstorm has the lease and subleases the main portion of the algae growing areas to Plankton Farms. This has been my intention for the entire time of our dealings accept for the several month period between the time Murray Raven suggested a joint application would improve our chances and when you were subsequently advised that a simple Rainstorm renewal was best. I have certainly never been ambiguous about not wanting any partnership on the master lease which is something that Rainstorm already bought and paid for. It was only when you and I first met face to face with Murray Raven and I asked him flat-out would it improve my chances of lease renewal if it was a joint application rather than Rainstorm only. When he said he thought it would be better to make a joint submission, I didn't like it one bit but - I sucked it up and agreed to use that tactic if it improved the palatability of our renewal application. This was despite my expression to you that I figured it would only add a few % increase of our chances which I rates [sic] as already being greater 90% chance of renewal. I think it is important to point out that this is the current situation: Rainstorm had already negotiated and purchased 100% of the lease and all physical assets on the site from Aurora in two separate transaction [sic]. We had to wait for the actual transfer process to work through the slow-moving processes of government which, as we know, is excruciatingly slow. This purchase was a result of a multi-year battle which makes the current lease renewal, seem like a trivial exercise. I'm not saying the current renewal has been quick and easy but in comparison to the heavy lifting and expenditures made by Tim and myself before you arrived on the scene it has been. We've probably spent more on lawyer's fees than you've spent total. We had to demonstrate to PDC et al that aquaculture/algae farming would take place on the site as well which would occur the insertion of a sublease. This was ALWAYS Rainstorm's plan - acquire the master lease, get our bitterns production in order, then sublease out the algae farming infrastructure to someone who could make best use of it. The foot-dragging by the PDC meant that we had to bring an algal tenant into the scene a bit earlier than we planned. … 94 The primary judge noted that there were aspects of this email from Mr Kerr which were not accurate. But, in his Honour's view, it did not matter whether the justification provided by Mr Kerr for disagreeing with the matters set out in Mr Tracton's email was correct. Rather, what was apparent from this point on was that Rainstorm maintained that there was no binding agreement and insisted upon only discussing with Plankton the terms of the sub-lease. It is clear that Rainstorm refused to accept that there was an agreement which required it to seek a transfer of the "master lease" to Algalfields. 95 The short issue in the proceeding, his Honour said, was whether this was a course that Rainstorm was free to adopt or whether it was bound by contract (or should be treated as being bound by reason of Mr Kerr's signature to the Submission to the Department) to press for the lease being granted to Algalfields. 96 On 16 July 2015, Coode & Corry wrote to Mr Kerr recording Mr Tracton's instructions that Mr Kerr had purported to unilaterally alter the terms of the agreement reached regarding the joint enterprise to obtain the lease and to conduct activities on the land, including commercial farming of algae. The letter rejected the assertion that the terms of the agreement could be altered and rejected proposed new terms. The letter requested confirmation that Mr Kerr would adhere to the existing agreement. This confirmation was not forthcoming.

Analysis by the primary judge 97 The primary judge then addressed the nature of the contract claim, noting that the case was that there was in existence an enforceable contract reached by the telephone conversation at the end of November 2014 by which the parties agreed to be immediately bound to all the terms of an offer made by Rainstorm on 26 November 2014 (being the version before the final V4 proposal from Plankton to Rainstorm). That agreement was to have the terms stated in a form which would be fuller or more precise but not different in effect or was made by the parties expecting to make a further contract in substitution for the first containing, by consent, additional terms. The alternative contractual argument was that if there was no agreement reached in the telephone conversation, then assent to those terms could be inferred from the acts and conduct of the parties in the period thereafter until around late May or early June 2015. 98 Following June 2015, as the primary judge noted, the competing positions of the parties had been established. Plankton contended there was a binding agreement. Rainstorm denied this position, but was willing to continue to negotiate. Indeed, there were extended discussions and negotiations between the parties attempting to resolve their dispute during which time Plankton Farms remained on-site undertaking substantial activities to progress the production of DSA and incurring significant costs. As the primary judge noted, however, that conduct clearly took place in the context of the ongoing disavowal by Rainstorm of the existence of a contract in the terms alleged, or otherwise. Plankton, on the other hand, contended that the conduct of the parties in occupying the Site together over a considerable period demonstrated that there was no reason to think that there would be difficulty in the constant supervision hurdle in relation to an award of specific performance. 99 As was apparent from the primary judge's narrative and analysis of the events, he was not satisfied that any concluded contract had been reached between the parties arising from the telephone conversation at the end of November 2014, but fully accepted that the conduct of the parties prior to the exchange of their proposals was contextually important for the events which took place in November 2014. 100 The context, as perceived by his Honour, was that Plankton had gone on to the Site and had taken substantial steps towards advancing the production of DSA. It did this even though it was clear that there was no agreement in place. This behaviour was inevitably speculative because, on any view of the matter, there was no agreement between the parties and there was a commercial risk that no long term lease could be secured. This behaviour, his Honour also said, was consistent with a course of waiting until there was certainty concerning a long term lease before finalising the terms of an agreement, a course generally reflected in the documents. The parties, indeed, had agreed the terms of an arrangement or overall plan and they had committed to a "partnership" in the non-technical sense. His Honour said it was a partnership in the sense that they would work together to secure the long term lease so that Plankton and Rainstorm could undertake activities on the Site. They had not, however, worked through any of the details or terms that would apply. 101 His Honour's view was that despite Plankton having been on the Site from the beginning of August 2014 until the beginning of November 2014 incurring substantial costs, there had been no discussion or negotiations between the parties as to the terms of an agreement to govern their ongoing relationship. The primary judge noted Mr Tracton's acceptance that his conduct in going onto the Site in August 2014, and undertaking work in relation to DSA, was partly to show that his intentions were genuine and to showcase his abilities so that it would be easier to reach an agreement with Mr Kerr. Although Mr Kerr supported and committed to the exercise of making a joint application for a new lease in August 2014, the parties had not taken any immediate steps to discuss the terms of their long term agreement. This, his Honour said, was also consistent with leaving the final terms until the outcome of the lease application to the Department was known. His Honour considered that the immediate context for the exchange of the proposals in November was the need to formulate with sufficient detail the business arrangement that would be put in place if a long term lease was secured to enable the urgent preparation of a submission to support the application for long term leases. Importantly, in his Honour's view, the parties did not need to conclude an agreement at that time as Plankton had already entered onto the Site and was advancing the DSA component of the planned activities. 102 Essentially, engaging in ongoing discussions was consistent with the course that had been adopted up until that time, which was to leave the finalisation of the terms of an agreement until after the position in relation to the long term leases was known. His Honour said, if the parties were to move to finalising the terms of an agreement that would govern their relationship over a very long term, then it would be expected that there would have been some explicit mention of a deviation from the course that they had been following up until that time. 103 His Honour also observed that the exchange of proposals began with a brief email, attaching a consent for Plankton to become a member of Algalfields and, importantly, the statement by Mr Kerr that he had asked his solicitor to begin drawing some of the necessary documentations and "even though it won't all be in place we'll have enough to tell the [Department] the general plan". The primary judge characterised this as Mr Kerr taking steps to establish Algalfields, even though there had been no response from Mr Tracton. This too was consistent with the parties taking steps to advance their relationship, even though they had not concluded an agreement. 104 The primary judge continued his analysis as to why a concluded agreement was not reached, saying that the response from Mr Tracton was to prepare a document entitled "Revised Proposal Summary". It was not couched as an offer, nor did it invite any form of response by which the contents was to be accepted or agreed. It did not provide for any signature or invite endorsement of consent or acceptance. It was sent under cover of an email that included the statement "Happy to talk this through further". Before sending the Revised Proposal Summary Mr Tracton took legal advice about its contents, but there is no evidence that this was known to Mr Kerr. 105 As to the next proposal, the V2 proposal, which was sent to Mr Kerr with a covering email from Mr Tracton referring to "our discussions" and asking for "thoughts and comments", it also stated that "[i]f this arrangement is suitable, I would like to work [to] having both new entities" registered. The primary judge opined that the use of the term "arrangement", in context, indicated to a reasonable party in the position of Mr Kerr that Mr Tracton was also working on the basis stated by Mr Kerr at the outset, namely, that they were engaging in discussions that would result in enough to tell the Department "the general plan" in the Submission that was being advanced at the same time. 106 When Mr Kerr responded with a marked-up V2 proposal (in effect, V3), his covering email said "[w]ould appreciate any comment and feel free to call me". There could be no suggestion this was consistent with a finalised agreement. The main change was to the equity in Algalfields which was amended to show 85% to Rainstorm and 15% to Plankton. 107 His Honour was also satisfied that the subsequent conduct of the parties was not such as to manifest consent and an agreement as pleaded. The conduct, in short, his Honour said, was consistent with the parties wishing to reach an agreement and expecting that they would, but not unequivocally confirmatory that they had reached agreement. Specifically, the primary judge referred to the following matters. 108 First, the contents of the Submission to the Department shortly following the November telephone conversation could not be considered divorced from the course of dealings between the parties. While it is true that the terms of the Submission and covering letter reflected the extent of the consensus reached through the exchange of the proposal documents, the language used in the Submission was hedged with qualifications consistent with the parties not yet having concluded an agreement, according to the primary judge. As examples of this, his Honour referred to the letter saying that Rainstorm and Plankton had agreed to form a partnership and had created a new business enterprise called Algalfields. His Honour stressed that the letter did not say that they had formed the partnership, nor did it say that they had entered into a joint venture agreement or a shareholders agreement or, indeed, that they had concluded any form of agreement. His Honour said (at [158]): It is one thing to agree to form a partnership and create a new business enterprise. It is a different thing to reach a binding agreement as to the terms that will govern the partnership and the new enterprise. The general statement in the letter is akin to the statements made by the parties as early as May 2014 that they have agreed on arrangements to share the facilities. There is no suggestion that those statements reflected the existence of a binding agreement. 109 Plankton takes firm issue with the dissection of the correspondence and close analysis to the words without, it is said, the full appreciation of the context and intent of the parties. 110 His Honour went on to observe that the Submission stated that a new business entity named Algalfields has been created with joint ownership by Rainstorm and Plankton. In reality, however, that had not occurred. His Honour said that the creation of Algalfields, in any event, was equivocal. Equally, a statement it had been created was not in fact correct. The fact that the Submission said that "Rainstorm is willing to relinquish its rights to apply for a subsequent 21 year lease … in favour of Algalfields doing so" did not, according to the primary judge, indicate that the parties had entered into an agreement to that effect subject to the consent of the Minister. Rather, it simply expressed a willingness on the part of one party, Rainstorm. 111 Further, the Submission stated that Algalfields would be the master leaseholder and manager and set out an ownership structure consistent with the structure in the proposals. It stated "[it] is anticipated that the lease of the Site will be transferred from Rainstorm to Algalfields under a new Lease agreement with simultaneous approval being sought for Algalfields to sub-lease the Site to Plankton Farms and Rainstorm". As his Honour noted, this language was consistent with the parties' expectation as to the nature of the agreement which would be concluded between them given their then current plan if the Minister's approval was obtained. His Honour said the language used was not of a kind to indicate that a different view should be taken concerning the exchange of proposals and the effect of the telephone conversation. 112 It would be commonplace for the parties to conclude an agreement which was subject to ministerial consent if that had in fact occurred. Such a document might be expected to say so "in terms", his Honour said. The Submission itself and covering letter did not support a conclusion that a binding agreement had been reached between the parties in the terms alleged, according to the primary judge. 113 Secondly, there was the reliance by Plankton Farms on the ongoing activities on the Site. That conduct, his Honour said, was the same as the conduct which had occurred prior to November 2014. The primary judge noted that the ongoing activities had to be considered in light of the activity that had transpired between August and November 2014 before which, even on Plankton's case, no agreement was alleged. Rather, it was consistent with Mr Tracton trying to demonstrate his capability. 114 Finally, his Honour drew on two instances of conduct inconsistent with an agreement being reached. The first was that Mr Tracton did not cause Plankton Farms to issue shares to Rainstorm, as provided for in the proposal documents. The failure to take that significant and obvious step by way of implementation counted against Plankton's claim. This was precisely the kind of step that would not be implemented if an agreement had not been concluded. 115 Next, according to his Honour, it was not until May 2015 that any further document was presented to record any alleged agreement and what that document presented was not a form of shareholders agreement or other more detailed agreement (as contemplated by the proposals) but rather by a varied form of the V3 proposal. His Honour also referred to the May 2015 draft EOI, presented in support of the royalties for regions funding, which referred to the Plankton Farms and Plankton making significant investments "on speculation, without any long term lease in place". Mr Tracton, however, said that the "on speculation" was confined to the absence of long term leases, not any view on his part that there had been no concluded agreement with Rainstorm. His Honour, in favour of Plankton, accepted the words were capable of that construction and placed no weight on them despite concluding that there was no manifestation of mutual assent by conduct to the terms of the V3 proposal occurring after November 2014.

Defences advanced by Rainstorm 116 Another aspect of the debate between the parties related to Rainstorm's contention that essential terms had not been agreed. It was unnecessary to deal with this aspect of the defence in light of his Honour's conclusions, however, the primary judge did note the difficulty that the agreement as alleged was an agreement to which only Plankton and Rainstorm were parties. It was said that they agreed to form Algalfields and would do all that was necessary to cause Algalfields to become the holder of the master lease including, if necessary, for Rainstorm to apply to transfer the leases to Algalfields. Beyond that, however, his Honour said no aspect of the agreement as alleged could require Algalfields to take up such a lease. Accordingly, in those circumstances, if the nature of the transaction contemplated by the parties was one in which Algalfields could be required to enter into the master lease as lessee if the necessary ministerial consent was obtained, it would make Algalfields an essential party. Algalfields was not contended to be a party and could not be. 117 Rainstorm raised a further defence of abandonment. It said that even if there was a binding agreement, the conduct of Plankton and Plankton Farms after June 2015 meant that it had been abandoned. His Honour found it unnecessary to consider that aspect, given that the case required urgent determination. There is no notice of contention pressed.

Misleading or deceptive conduct 118 The primary judge then turned to the misleading or deceptive conduct claim, which turned on Rainstorm allegedly joining in representations made to the Department in December 2014. That matter being expressed as follows (at [181]): In the statement of claim, the alleged representations were pleaded in the same terms as the alleged express terms of the joint venture agreement, namely: (a) Rainstorm would take all necessary steps to incorporate a company in the name of Algalfields with the shareholding to be held 85% by Rainstorm and 15% by [Plankton]; (b) Rainstorm would transfer to, and Algalfields would hold, the master leases for the Site; (c) [Plankton] would take all necessary steps to incorporate Plankton Farms with the shareholding in that company to be held 80% by [Plankton] and 20% by Rainstorm; (d) Rainstorm and [Plankton] agreed to appoint Plankton Farms as the aquaculture research, farming, manufacturing and trading company for DSA; (e) in exchange for shares in Plankton Farms, [Plankton] would provide to Plankton Farms up to $300,000 by way of loan without interest and certain other matters; (f) in exchange for shares in Plankton Farms, Rainstorm would provide to Plankton Farms up to $300,000 in the form of in-place infrastructure to be paid back with any monies advanced to [Plankton], expertise in operational aspects on-site and management; (g) upon approval, Algalfields would provide Plankton Farms and Rainstorm separate sub-leases; (h) the annual charge for the sub-lease would be 50% of the cost of the master leases plus an additional $2000,000 to cover administrative and ancillary expenses; and (i) Plankton Farms would acquire the right to use certain infrastructure on the Site. 119 By signing the Submission to the Department, it was further pleaded there was a representation that there was in existence a joint venture in the form of the pleaded Joint Venture Agreement. The claimed representations focussed around the existence of the Joint Venture Agreement. As the primary judge noted (at [186]), Plankton summarised their misleading or deceptive conduct case involving representations "principally, that a binding [joint venture agreement] existed, and that material obligations under the [Joint Venture Agreement] had been or would be satisfied". 120 On that basis, the primary judge focussed on claims that supported the relief that recognised the existence of the Joint Venture Agreement and sought to require the incorporation of Algalfields and an application by Rainstorm to the Minister to transfer the master lease to Algalfields. 121 The primary judge canvassed the principles as reflected in the following authorities: Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 (at 202), approved of in Campomar Sociedad, Limitada v Nike International Limited (2000) 202 CLR 45 (at [100]); Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 (at [109]), quoted with approval in Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304 (at [102]); and Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486 (at [35]-[40], [102]-[105]). His Honour (at [197]) broke down the representations into: a representation allegedly made about what Rainstorm would do in the future, which lacked reasonable grounds; a representation allegedly as to what Algalfields would do in the future, which lacked reasonable grounds; and a representation allegedly made about the present existence of an agreement in the terms of the V3 proposal (amended as to the equity in Algalfields). 122 As his Honour said, it was the final claim which was the focus of submissions by Plankton at trial, although the position on appeal was somewhat different. The final representation was the only representation in respect of which an express declaration was sought. 123 His Honour concluded that there was no representation as to the existence of an enforceable agreement. His Honour said that the statements in the Submission to the Department could not be divorced from their context, namely, the dealings as between Plankton and Rainstorm, which were undertaken to reach a consensus as to their overall plans for the purpose of making the Submission. Findings had already been made that, viewed objectively, those dealings did not culminate in the manifestation of assent to terms which were to be legally binding. It was necessarily implicit in the findings already made that a reasonable party in the position of Mr Tracton, who was the guiding mind of Plankton, would not have concluded there was a binding agreement. The primary judge said that the additional step of subscribing to the particular statements in the Submission to the Department does not alter the impression created for a party in the position of Mr Tracton. It was not a statement directed to Plankton, but a communication to advisors to the Minister. In considering the impression created by those words for Plankton, there must be due regard to this aspect as his Honour said. 124 His Honour concluded it was evident from the terms of the Submission that the parties were informing the Minister of their plans and intentions if he were to accede to the application for the grant of a new lease to Algalfields. The Submission did not depend on the existence of a binding agreement of the kind alleged, nor was any statement made that such an agreement existed. In the covering letter, the statement was that the parties had agreed to form a partnership and had created a new business enterprise called Algalfields. That would, however, be understood by a person in Mr Tracton's position to reflect the nature of the dealings that had so far transpired between the parties. The statements simply reflected the fact that the parties had reached a consensus as to the matters that were addressed in the Submission. 125 The primary judge also rejected the contention that there had been a misleading statement concerning the future conduct of Algalfields. He referred to the statement actually in the Submission being "Algalfields is proposing to sub-lease … to Plankton Farms and Rainstorm". His Honour said that this statement was an accurate reflection of the proposal at that time and there was a reasonable basis for making the statement because it reflected the consensus that had been reached in the discussions between the parties. His Honour said that it may be that there was an implicit representation that the matters stated represented then present intentions or expectations of Rainstorm, but there was no evidence to suggest that Mr Kerr or Mr Keenan, as directors of Rainstorm, did not intend as at December 2014 to proceed in the manner set out in the proposal. Rather, they changed their position by late May 2015. The primary judge noted the explanation provided at that time was that the Minister was willing to issue a new lease to Rainstorm and there was not a need for Plankton Farms to have an interest in the leases. There was no suggestion, however, as at December 2014 that the matters stated in the Submission were matters that Rainstorm, by its directors, did not expect would occur or did not intend to cause to occur. 126 As to future conduct of Rainstorm, the primary judge reached a similar conclusion for similar reasons as those in relation to the claim concerning the incorporation of Algalfields. 127 The primary judge then rejected a contention by Rainstorm, not raised by way of cross-claim or on appeal that the conduct was not in trade or commerce. 128 The primary judge then dealt with reliance, but only on the basis that it would be necessary to do so if his conclusions as to the conduct were incorrect. The position taken by Rainstorm was that Plankton had been willing to take the risk and embark upon the enterprise on a speculative basis without guarantee of long term leases. However, whilst his Honour accepted this to be the case from August to November 2014, after that time there was evidence Mr Tracton believed there was a legally binding agreement. As such, the primary judge considered that were he wrong in concluding there was no misleading or deceptive conduct by Rainstorm and that the conduct represented a legally binding agreement, then the evidence established reliance by Mr Tracton up until June 2015. Of course, after that point, it was clear that any such representation was not continuing, as it was expressly denied by Rainstorm. There is no cross-appeal on reliance. 129 His Honour did note in passing that if misleading or deceptive conduct as to the existence of a binding agreement had been established, there would then be an issue as to the nature and extent of relief that could be granted, having regard to the fact that the relief sought would extend to obliging Algalfields, a company not incorporated at any time and, therefore, not a party to the proceedings, to do certain things. We note that in particular, it would be burdened with the consequences of a representation by one of its shareholders, namely, Rainstorm, by being compelled to grant sub-leases in respect of the master lease, when no pre-incorporation contract claim had been pleaded. This topic, had it been necessary to consider, would have been relevant to relief. 130 There was also a claim against Mr Kerr on the basis that he was knowingly concerned with the putative misleading or deceptive conduct. That naturally fell away with the primary claim failing. His Honour, nonetheless, referred to Yorke v Lucas (1985) 158 CLR 661 (at 670) and Rafferty v Madgwicks (2012) 203 FCR 1 (at [254]). His Honour accepted that Mr Kerr would be liable, had Rainstorm been liable. There is no cross-appeal on that point.

Estoppel 131 In relation to the estoppel claim, this was based essentially on a representation in the same terms relied upon for the claim of misleading or deceptive conduct. The estoppel claim, therefore, necessarily fell away for two reasons. First, his Honour had found the alleged representation was not made. Secondly, the primary judge noted that it had not been shown that Rainstorm knew or should have known, in all of the circumstances that Plankton was acting on the basis that there was an agreement in place governing a relationship between Plankton and Rainstorm. As with the reliance point, the primary judge concluded that given the course of events, it was reasonable for a party in the position of Rainstorm to conclude that the activities of Plankton and Plankton Farms on-site were undertaken in the hope or expectation that ultimately an agreement would be concluded between the parties if and when long term leases of the Site were secured. 132 The representations not being made out, the estoppel claim failed. But, again, there was a further question in relation to relief which could have been granted had the claim been made out. The primary judge discussed this question as follows, concluding that he would need further submissions and possibly evidence before determining relief had the question arisen (at [226]-[228]): 226 … Since June 2015, any representational conduct by Rainstorm as to the existence of a binding agreement has been at an end. Therefore, the considerable expenditure since that time has not been encouraged by any conduct on the part of Rainstorm. The relief sought by the applicants would result in the transfer of very long term and valuable leasehold interest. It would require the grant of a long term sub-lease to Plankton Farms and for Rainstorm to become a minority shareholder in that company. On the other hand, the detrimental reliance up until June 2015 involved an identifiable amount of expenditure in the hundreds of thousands of dollars. 227 In Sidhu v Van Dyke (2014) 251 CLR 505, French CJ, Kiefel, Bell and Keane JJ said at [85]: The appellant's argument, rightly, sought no support from the discussion in cases decided before Giumelli v Giumelli of the need to mould the remedy to reflect the "minimum relief necessary to 'do justice' between the parties". There may be cases where "[i]t would be wholly inequitable and unjust to insist upon a disproportion that making good of the relevant assumption"; but in the circumstances of the present case, as in Giumelli v Giumelli, justice between the parties will not be done by a remedy the value of which falls short of holding the appellant to his promises. While it is true to say that "the court, as a court of conscience, goes no further than is necessary to prevent unconscionable conduct", where the unconscionable conduct consists of resiling from a promise or assurance which has induced conduct to the other party's detriment, the relief which is necessary in this sense is usually that which reflects the value of the promise (footnotes omitted). 228 In this case, if the estoppel claim had been upheld, before granting the relief sought it would have been necessary to consider whether it would be disproportionate to make good the relevant assumption because the relief would operate to an extent that would be "wholly inequitable and unjust". Had I concluded that the claim in estoppel has been made out, I would have been inclined to invite the parties to make further submissions on this question before determining whether the relief sought by the applicants making good the representation should be granted. 133 There is no cross-appeal on the estoppel conclusion. 134 The claims were dismissed with costs, fixed in a lump sum.

GROUNDS OF APPEAL 135 The grounds of appeal are brief and can be stated verbatim: 1. The learned trial judge erred in failing to find that an agreement had been reached between the first appellant and the first respondent. 2. In finding that Algalfields Pty Ltd had not, as at December 2014, been created, the learned trial judge ought to have found: a. The first respondent had engaged in misleading or deceptive conduct; b. The second respondent was knowingly concerned in the first respondent's misleading or deceptive conduct. 3. The learned trial judge erred in finding that there was no misleading or deceptive conduct for the following reasons: a. The learned trial judge failed to apply the correct test in evaluating the circumstances of the impugned conduct; b. Even if the learned trial judge was correct in finding that no agreement had been concluded between the first appellant and the first respondent, it did not follow that the first respondent did not represent by its conduct that such an agreement had been concluded; c. Even if the appellant erroneously believed that an agreement had been formed between the first appellant and the first respondent this did not, by itself, negate the misleading and deceptive nature of the representation that an agreement had been formed. 4. The learned trial judge erred in failing to find that the first respondent was, by its conduct, estopped from denying the existence of an agreement between the first appellant and the first respondent. 5. The learned trial judge ought to have found that the first respondent was estopped from denying the existence of an agreement.

Ground 1 - error in failing to find an agreement had been reached 136 As indicated earlier in these reasons, no exception is taken to the principles identified by the primary judge, but Plankton says the following principles are also material. First, an agreement said to have been formed as a result of correspondence requires consideration of that correspondence as a whole. Plankton particularly stresses that it is wrong to isolate any part of the correspondence from the rest in order to prove or disprove the existence of a binding agreement: Geebung Investments Pty Ltd v Varga Group Investments No 8 Pty Ltd [1995] NSWCA 166 per Kirby P (as his Honour then was) (at 40). The second principle upon which Plankton relies is that even when a document recording the terms of parties' agreement specifically refers to the execution of the formal contract, the parties may be immediately bound: G R Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631 per McHugh JA (with whom Kirby P and Glass JA agreed) (at 634). Thirdly, it is stressed that the task of the Court is to ascertain the intention of the parties and in so doing "no narrow or pedantic approach is warranted, particularly in the case of commercial arrangements": Jpex Software Services Pty Ltd v Hosking [2000] VSCA 239 per Eames JA (with whom Batt JA relevantly agreed) (at [56]), quoting Upper Hunter County District Council v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 per Barwick CJ (at 437). 137 This is in the context of Plankton's case below and on appeal, relying upon the existence of a Joint Venture Agreement in either the first or "fourth" category of Masters v Cameron (1954) 91 CLR 353 per Dixon CJ, McTiernan and Kitto JJ (at 360). It also relies on the dicta of McLelland J in Baulkham Hills Private Hospital Pty Ltd v GR Securities Pty Ltd (1986) 40 NSWLR 622 (at 628), where his Honour said: "… legally binding agreement in principle …" This phrase, occurring as it does in the letter of 21 March 1986, and tacitly adopted by the letter of 25 March 1986, was clearly part of the consensus. It was submitted on behalf of the defendants that it signified that although agreement had been reached on some terms, agreement had yet to be reached on others, from which it followed: (1) that regarded as an "agreement to agree" on those other terms, the consensus was incapable of forming a binding contract; and (2) that the parties could not have intended to be legally bound prior to agreement being reached on those other terms. So far as the first of these matters is concerned, I do not accept that the words "agreement in principle" in the present context import the idea that there must necessarily be agreement on further terms to be embodied in the "formal contract" provided for in the consensus, as opposed to an expectation that there would or might be agreement on further terms to be so embodied. In other words, I do not consider that the phrase in question should be construed as an "agreement to agree" on further terms, but rather as an indication, at the most, of an expectation of agreement on further terms. So far as the second matter is concerned, I do not consider that any implication of an intention not to be legally bound which might otherwise be suggested by the words "agreement in principle" can prevail over the clear import of the words "legally binding". The intention of the parties to be legally bound by their consensus is sufficiently clearly expressed to take the case out of the third class of cases referred to in Masters v Cameron (1954) 91 CLR 353 at 360-362, that is, "… cases in which the terms of agreement are not intended to have, and therefore do not have, any binding effect of their own (at 361). There is in reality a fourth class of case additional to the three mentioned in Masters v Cameron, as recognised by Knox CJ, Rich J and Dixon J, in Sinclair, Scott & Co v Naughton (1929) 43 CLR 310 at 317, namely, … one in which the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms". Their Honours refer to the speech of Lord Loreburn, in Love & Stewart v S Instone & Co (1917) 33 TLR 475 at 476, where his Lordship said that: "It was quite lawful to make a bargain containing certain terms which one was content with, dealing with what one regarded as essentials, and at the same time to say that one would have a formal document drawn up with the full expectation that one would by consent insert in it a number of further terms. If that were the intention of the parties, then a bargain had been made, none the less that both parties felt quite sure that the formal document could comprise more than was contained in the preliminary bargain." … 138 Plankton described his Honour's conclusion in board terms. First, the parties reached a "sufficient consensus" to enable the Submission to be made to the Department; that they had "agreed the terms of an arrangement or overall plan"; and then had "committed to a 'partnership' in the sense that they would work together to secure the long term lease", but nothing more. Secondly, Plankton notes that the primary judge found that any agreement beyond that "sufficient consensus" would only be concluded in writing and after the outcome of the application to secure the long term leases was known. Finally, his Honour found that at no time were all of the essential terms agreed because at no time was Algalfields a party to the putative agreement. 139 Plankton complains that the primary judge erred in reaching those conclusions because of three factors: (a) by focusing disproportionately on the language used, or not used, by the parties and thus, on matters of form, rather than the "body of conduct". Specifically, the parties' interaction by reference to their commercial aims and expectations, their post-contractual conduct, the surrounding circumstances and the way they portrayed their relationship with the outside world; (b) by ignoring the essential elements of the agreement, namely, the establishment of two mutually-owned entities: one to hold the leases and the other to operate an aquaculture business. Plankton stresses that those essential elements were agreed; it was merely the "meticulous detail" which was not and that is insufficient to negate an agreement: Terrex Resources NL v Magnet Petroleum Pty Ltd (1988) 1 WAR 144 per Kennedy J (at 343); and (c) by misinterpreting or failing to take into account post-contractual conduct which was consistent with the existence of mutual assent as opposed to the essential finding that nothing had been agreed, which is difficult to accept in light of both parties' post-contractual behaviour. 140 Breaking those three alleged essential errors down to more detail Plankton, in its argument on appeal, focuses on the following matters.

Undue focus on language 141 Plankton contends that the analysis by the primary judge of the salient events between 24 and 26 November 2014 and in the post-contractual conduct, transgressed the principles identified separately by Gleeson CJ and Kirby P in Geebung Investments. Kirby P said (at 41 and 43-44), extraneous): … (1) Courts should be the upholders of bargains and not their destroyers. Of course, I realise that this aphorism, derived from the cases, begs the question to be solved. However, it is important that courts should approach challenges such as the present avoiding an over-nice approach to the arrangements between the parties which result in a disharmony between the parties' reasonable expectations and what our law provides. To strike down the agreement of the parties here, themselves and without solicitors, to settle their dispute, would disappoint legitimate and reasonable expectations of the parties and of the community. The law should strive to avoid that result in every case, but particularly in an agreement between business people whose agreements the law should be specially ready to uphold and enforce. … (5) Settlement of litigation is generally welcomed and facilitated by courts, including this court. Courts should avoid adopting a re-interpretation of the facts of an alleged agreement which undoes settlement of litigation, formally arrived at. The "settlement" of a case in an elevator with an attorney employed in an administrative capacity (as in Bettison) is a wholly different case from this. Here the actual parties to the dispute deliberately met together. They settled their dispute. They did so to avoid litigation. It will be a serious wrong in this case if the law were to deny the parties that facility and to insist, in effect, that they cannot settle their disputes alone but must have formal documents prepared by lawyers. Yet that would be the effect of insisting that there was no binding agreement until the lawyers had settled every term and drawn all the documents to close the equity file. Properly viewed, these were machinery steps, so long as all vital terms of the settlement were agreed, as in my view they were. If necessary, disputes about such machinery questions as remained outstanding could be resolved by a court in terms compatible with the fundamental agreement to settle, on terms already arrived at. To make binding agreements, business people do not need to involve lawyers. The common law upholds their agreements. It does not frustrate them nor send them back to lawyers when the very purpose of their agreement was to avoid legal process and to involve lawyers only for the properly subordinate role of giving effect to the agreement which the parties had made[.] 142 Plankton makes the point that his Honour in every instance interpreted the language, or absence of language, against a finding of mutual assent and in many cases without reference to the context viewed as a whole. It is argued that it was inappropriate and incorrect for his Honour to have attached significance to words and phrases appearing in the proposals exchanged between the parties in the lead up to the Submission, for example, the expression "points for consideration", the "proposal is looking good ...", "moving forward", as well as the absence of "express language manifesting an intention to reach a concluded agreement". None of those matters taken in context was significant, according to Plankton. 143 To interpret the sentiments in the Submission to the Department, isolated from parts of the correspondence, erroneously ignores the context and surrounding circumstances, it is argued. The Submission, it was contended, was an important post-contractual representation made to a State government department jointly by each of Rainstorm and Plankton to persuade the government to grant the parties "a new, 21 year lease of the specified property" in the name of Algalfields. It contained information about "the business relationships between Rainstorm and Plankton". The observations as to certain statements in the letter and accompanying Submission were unjustified and contextually erroneous, according to Plankton. Plankton emphasised the statement in the letter that "[t]he two companies have agreed to form a partnership and have created a new business enterprise called Algalfields Pty Ltd". 144 As to this, the primary judge had said (at [158]): The letter says that Rainstorm and [Plankton] "have agreed to form a partnership and have created a new business enterprise called, Algalfields Pty Ltd". It does not say that they have formed the partnership. Nor does it say they have entered into a joint venture agreement or a shareholders agreement or indeed that they have concluded any form of agreement. It is one thing to agree to form a partnership and create a new business enterprise. It is a different thing to reach a binding agreement as to the terms that will govern the partnership and the new enterprise. The general statement in the letter is akin to the statements made by the parties as early as May 2014 that they have agreed on arrangements to share the facilities. There is no suggestion that those statements reflected the existence of a binding agreement. 145 Plankton stresses that the statement in the letter, fairly read, conveyed the positions that the parties had formed a partnership and, in facilitation thereof, had created Algalfields. In the context of the Submission this is contended to be plain in its meaning and was not a vague statement of future intent. 146 Similarly, in the Submission, the following appeared: "a new business entity named Algalfields … has been created with joint ownership by Rainstorm … and Plankton". As to that (at [159]) the primary judge said that the creation of Algalfields was equivocal. Plankton complains that the statement concerning the creation of Algalfields was not equivocal. It was written as a statement of existing fact. The primary judge is said to have erred in reading those words down to be a meaningless statement of aspiration. Rather, in the context of a joint submission to a government department to procure a valuable long term land agreement, such an interpretation was wrong. Similarly, the Submission stated: As the incumbent leaseholder, Rainstorm is willing to relinquish its right to apply for a subsequent 21 years lease of [the Site] in favour of Algalfields doing so. In exchange, it has been agreed that Rainstorm shall gain a minority equity position in the newly formed Plankton Farms … (Emphasis added.) 147 Again, the primary judge held (at [159]) that this statement did not indicate that the parties had entered into an agreement. Plankton complains that part of the content of that passage, specifically the words "it has been agreed that" were not included in the judgment and were ignored. Plankton says his Honour erred by doing so and, specifically, failed to examine the words "it has been agreed". Rather, although his Honour made a number of observations in the judgment where the parties had not used the words in agreement, he is said to have ignored a positive statement in the Submission where the parties confirmed that they had reached agreement about Rainstorm gaining a minority equity position in the newly formed Plankton Farms. This Plankton stresses, was an important statement and directly contradicted his Honour's findings as to the effect of the 26 November 2014 exchange. The Submission was signed by both parties and it was made three business days after the 26 November 2014 emails and the telephone conversation. Figure 1, the "Relationship Structure" described above, was not a statement of future intent, but was a reflection of the agreement already reached by the parties. 148 Similarly, the statement by his Honour (at [160]), that the language used in the letter and the Submission was not of a kind to alter his Honour's view of the events surrounding 26 November 2014, is argued to be a failure to treat these significant and contemporaneous post-contractual events as required by the authorities. The effect of the letter and Submission was that the parties were informing the Department that they, being a partnership with an identified structure, deserved long term leases.

Surrounding circumstances 149 Plankton's next complaint is that his Honour considered the circumstances, but failed to give them any, or any sufficient, consideration. Specifically, Plankton refers to the following circumstances: (1) Mr Kerr was, as early as May 2014, acutely aware of the need to have continuity and aquaculture beyond Rainstorm's own activities in order to place Rainstorm in the most favourable position to obtain a long term lease renewal; (2) Rainstorm, unlike other parties interested in the Site, had something to lose because it had purchased Aurora's remaining interests in the leases in April 2014; (3) Mr Kerr was keen to demonstrate Plankton's involvement in the Site from May 2014. The emails included the statement on 30 May 2014 that Mr Kerr and Mr Tracton "have agreed on arrangements to share facilities at the Aurora algae site". That email went on to state that "our arrangement now provides continuity of the original lease requirements for aquaculture over and beyond Rainstorm's own activities in that space". By 24 June 2014, Messrs Tracton and Kerr represented to Dr King, CEO of the PDC, that Rainstorm would be taking an equity position in Plankton's farming arm; (4) On 8 August 2014, in his email to Mr Raven at the Department, Mr Kerr noted that "[w]e feel time is running short on the next phase of leasing for the Aurora site and want to put forward the best possible case for our use and a discussion with yourself... will be most valuable and appreciated" (emphasis added); (5) On 18 November 2014, Mr Kerr set out to Mr Tracton his understanding of how he saw their structure coming together and attached a document seeking Plankton's consent to become a member of Algalfields upon its registration by the Australian Securities and Investments Commission; (6) On 24 November 2014, Mr Tracton emailed Mr Kerr with his "revised proposal". On the following day, 25 November 2014, "a revised proposal V2" was further sent by Mr Tracton to Mr Kerr, which invited a response from Mr Kerr to Mr Tracton on 26 November 2014. Its significance was to change the proposed shareholdings in Algalfields to be held as to 85% by Rainstorm and 15% by Plankton, amending the earlier version which referred to an 80%/20% share split; (7) On 26 November 2014, Mr Tracton emailed Mr Kerr with the "revised V4 proposal for discussion". A telephone conversation, referred to by Mr Tracton in his affidavit, was important. 150 In relation to the 26 November 2014 exchange, the primary judge found that it was likely that the email was the subject of a telephone conversation and further found that the conversation was substantially in terms of that deposed to by Mr Tracton. This discussion was, as his Honour observed, the "key conversation upon which [Plankton]" relied in bringing the contract claim and was the main factual issue of dispute in these proceedings. 151 Plankton refers to the fact that the V4 proposal contained a number of bullet points under the heading "[f]urther points for consideration". The primary judge noted there was no suggestion in the evidence that these matters had been discussed and, moreover, that it was "unlikely" that there was an intention on the part of Mr Tracton to accept an 85%/15% split for equity without discussion of all the additional matters he had raised in the V4 proposal. His Honour found that the parties proceeded on the basis that any agreement would be concluded once the outcome of the application to secure long term tenure of the Site was known. 152 Plankton complains that this is an unduly narrow or pedantic construction, leading to an erroneous conclusion. The business structure and relationship between Messrs Tracton and Kerr, through the entities they controlled, is said not to be complex. Rather, it involved a jointly owned vehicle called Algalfields, which was to be held 85% by Rainstorm and 15% by Plankton, maintaining and managing the master lease provided by the Department. Plankton would operate a business on part of the Site for the purpose of commercial algae farming and production and, in that regard, have a sub-lease for the same duration as the Algalfields' master lease. The sub-lease rent was set forth, as was the division of ownership in Plankton Farms as between Plankton and Rainstorm. 153 Although Mr Kerr sought to identify some essential matters missing from the 26 November 2014 agreement, he accepted in cross-examination, that the parties had reached consensus "on the broad strokes of things". As to matters missing, Plankton says Mr Kerr pointed to a concern directors of Rainstorm had about the possibility of value transfer from Plankton Farms to Plankton. However, Plankton makes the point that those concerns were never important enough to be raised during any of the negotiations. Plankton contends they were, in fact, ex post facto concerns that rose no higher than a concern as to the possibility of a majority shareholder engaging in oppressive conduct, which could be addressed, if necessary, by recourse to law. The essential terms of the deal had all been agreed, Plankton argues, items not agreed were inessential. The "[f]urther points for consideration" raised by Mr Tracton were largely mechanical or managerial issues, which could be resolved by the company directors or, if not resolved, determined through the typical dispute resolution provisions contained in a shareholder agreement.

Post-contractual conduct 154 Finally, beyond an alleged undue focus on language and error in regard had to surrounding circumstances, Plankton stresses the post-contractual conduct which it is said was inappropriately examined by the primary judge and overlooked. In that regard, Plankton referred, relevantly, to: Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540 per Gleeson CJ (at 547-548) (with whom Hope and Mahoney JA agreed); and Geebung Investments per Kirby P (at 38-39). 155 The conduct which should have led the primary judge to conclude that an agreement had been reached was, according to Plankton, at least the following matters. 156 First, from December 2014, Mr Kerr: (a) instructed his solicitors to create Algalfields with an 85%/15% share split, which reflected the Submission; (b) paid the registration fee for Algalfields; (c) signed forms in relation to directorship and membership; (d) issued instructions in relation to the time pressure for registration of Algalfields, stating "the sooner you can get and [sic] ACN to me the better"; (e) forwarded to Mr Tracton emails exchanged with Mr Kerr's lawyers regarding the establishment of Algalfields; (f) provided to Mr Tracton a document entitled "Consent to become a Member of Algalfields Pty Ltd pursuant to Section 120 of the Corporations Act 2001 (Cth)" in relation to Algalfields; and (g) received from Mr Tracton a signed membership consent form for Algalfields. 157 The second matter is that on 1 December 2014, the Submission was issued in which Rainstorm and Plankton jointly represented the following: (a) in the subject header, it concerned an application by Rainstorm and Plankton "for and on behalf of [Algalfields] to conduct aquaculture algae cultivation & bitterns processing activities"; (b) it stated "the two companies have agreed to form a partnership and have created a new business enterprise called, Algalfields"; (c) the diagrammatic representation of the parties' relationship, set forth under "4. Subleases", reflected a business structure that had already been agreed between the parties; and (d) the Submission stated: In anticipation of the current leases expiring in April 2015, a new business entity named [Algalfields] has been created with joint ownership by [Rainstorm] and [Plankton] (Figure 1). As the incumbent lease holder Rainstorm is willing to relinquish its right to apply for a subsequent 21 year lease on [the Site] in favour of Algalfields doing so. In exchange, it has been agreed that Rainstorm shall gain a minority equity position in the newly formed [Plankton Farms] who will hold the Aquaculture Licenses and subsequently all commercial stakeholders will have an economic interest in both Rainstorm and Plankton Farms achieving maximal utilisation of the site and continuing commercial success. (Emphasis added.) 158 That the wording of the letter and Submission was drafted carefully was confirmed by Mr Kerr in cross-examination and by Mr Kerr's email to Ms Grace Pacecca of 12 December 2014, where Kerr noted: "I know we took quite a while to get our submission in as it is of burning importance to us and we took forever to tweak and edit it". 159 Importantly, in the same email, Mr Kerr said the following to Ms Pacecca: I trust the PDC understands that all of the infrastructure on the site now belongs to Rainstorm and [Plankton], regardless of who they might wish the next lease to be awarded in 2015. (Emphasis added.) 160 The representations in the Submission are said to have been plainly regarded as appropriate to not only present to the Department, but also to Mr John Lally, the CEO of the Karratha and Districts Chamber of Commerce and Industry and Deputy Mayor of Karratha. 161 Thirdly, on 1 December 2014, Mr Tracton with Mr Kerr's knowledge signed the EOI that was presented to the Department under the aegis of the "royalties for regions" scheme in which the following matters were noted: (a) an "Agreement and partnership between Rainstorm and [Plankton]"; and (b) the "Partnership Relationship Structure" placed Algalfields at the apex as the "Lease Management Holding Company". 162 Fourthly, Plankton and Rainstorm each commenced utilising the facilities, including the common facilities, in the manner contemplated in the proposals. On 11 December 2014, Mr Tracton assisted Mr Kerr to set up a "@planktonfarms" email address. 163 Plankton submits that the primary judge ought to have found that the post-contractual conduct was demonstrative of a concluded bargain. The primary judge erred by diminishing the significance of the Submission and the letter and by treating the utilisation of the facilities as nothing more than a continuation of previous activity when, in fact, this conduct was only explicable by reference to the existence of a concluded bargain.

Ground 1 analysis 164 As a starting point, in relation to the approach to be taken on appeal we are mindful of the need to identify error as stressed by Allsop J (as the Chief Justice then was) in Branir, followed and upheld recently in Aldi Foods Pty Ltd v Moroccanoil Israel Ltd (2018) 358 ALR 683 and consistent with the High Court's reinforcement of the role of intermediate appeal courts in Robinson Helicopter. In this case, there was only one occasion on which it was necessary to determine whether or not an account given orally was accurate. Otherwise, the approach taken by the primary judge was to take into account the content of contemporaneous communications against the backdrop and context of the commercial dealings and actions taken by the parties and others with whom they were both dealing. In that context, the benefit enjoyed by the primary judge is significantly more limited than would be the case in a trial which turns exclusively on the credit of a particular party. Nonetheless, as Plankton acknowledges, it is necessary for error to be identified. It is of course necessary for the error to be one to which the grounds of appeal point. The question is whether the asserted errors (or any of them) are established. 165 We do not consider that the primary judge, in concluding (at [101]) that the parties had not reached "any final and binding commitment to the terms of the proposal", made a finding which was "glaringly improbable" in the sense described in Robinson Helicopter. This critical finding made by the primary judge was based on careful consideration of the evidence of what his Honour described (at [99]) as "both the key conversation upon which the applicants rely in bringing their contract claim and … the main factual issue in dispute in these proceedings". His Honour's conclusion was, in our view, correct in light of the evidence (summarised above at [64]-[69]). 166 In our assessment, the contention that the primary judge failed to consider the parties' language and conduct in context as a whole is entirely without foundation or merit. We have set out in considerable detail the content of the primary judgment to illustrate the lengths to which his Honour went to look in detail at each aspect of the communications and background and to consider the submissions of the parties in relation to each step along the way. We specifically reject the contention that his Honour only examined exchanges and conduct in isolation without having regard to the context as a whole. It is quite clear from the following analyses that it was the latter to which his Honour directed attention. 167 While it is true that the primary judge looked at the specific negotiating expressions, he did not do so in isolation. He had regard to conduct which preceded the specific exchanges on which reliance is placed, observing that the prior conduct provided important context. The same approach was adopted in relation to the Submission to the Department. The approach was as even-handed as the content and context would permit. 168 It was correct to conclude that the Submission did not record a completed agreement between the parties. That was not its purpose on any view of the matter. The Submission was prepared to present a business case to the Department as to why the leases ought to be renewed and in response to the request for the same to Mr Kerr on 13 November 2014 from a Department project officer. His Honour expressly said that the contents of the Submission should not be considered divorced from the context of the dealings between the parties and that was necessarily so. Those dealings have been examined in close detail in preceding paragraphs of the judgment. The view taken by the primary judge that the parties believed they would be able to reach agreement as at the time the alleged oral agreement occurred and the Submission was made, was not only open, but undoubtedly the correct assessment of the position. 169 It is relevant to repeat again for emphasis that Plankton nominated 26 November 2014 as the date upon which the alleged Joint Venture Agreement was formed, relying on the 26 November 2014 email exchange as the key evidence of that agreement. Here we again note the primary judge's findings about absence of any agreement as between the parties. His Honour found no agreement has been reached between the parties as at 27 May 2014 (at [33]) and this was not contested on appeal. The primary judge had due regard to the formal confidentiality agreement entered into between the parties (at [44]-[45]), attaching what we consider to be appropriate significance to the execution of a formal agreement in respect of this matter in the context of assessing whether a formal agreement had been made as alleged. No issue was taken on appeal with his Honour's finding (at [58]) that no agreement had been reached as at August 2014. The key finding challenged on appeal is his Honour's conclusion (at [93]) about the email of 26 November 2014, though Plankton also takes some issue with the consideration had to the 24 November 2014 email exchange (at [51]) and the emphasis placed on that correspondence. 170 Too much emphasis, in our view, is placed by Plankton on the statement "it has been agreed". His Honour was entitled to and correct to observe that expressions akin to that statement had been made by the parties from as early as May 2014, long before the time at which Plankton claims that a binding agreement was reached. For parties to refer to the fact they have agreed to something, does not mean, without more, that they are contractually bound. Equally, we consider the statement to the effect that Algalfields had been created, was equivocal. Certainly, steps were being taken to advance the relationship between the parties at this point in relation to the creation of Algalfields but, in fact, it had not even been created at all. It is true that the notice of consent for Plankton to become a member of Algalfields was forwarded on 18 November 2014 and this is consistent with the fact that the parties were anticipating reaching an agreement and were taking steps to be in a position to progress should an agreement be reached, however it does not follow, either alone or in context amongst other statements, that the incorrect statement that Algalfields had been created was anything other than equivocal. What is central to the reasoning at this time, is that the parties were anxious to secure the necessary leases so that they could then proceed with committing to an agreement. It does not mean that they had reached an agreement, nor did the conduct surrounding the Submission to the Department evidence or confirm they had reached such an agreement. 171 From the outset, by email of 24 June 2014, it was confirmed that the equity split could not be completed until the new long term lease arrangements for the Site were finalised. This was the whole thrust of the parties' activities at this time to lock in the long term leases of the Site. The finding made that any long term agreement would be concluded once the outcome of the application to secure the long term tenure of the Site was known was undoubtedly correct. 172 The construction placed by the primary judge on the exchanges between the parties and others, in our view, is not shown to be in error. 173 There is a further difficulty with the content of the Joint Venture Agreement. There is no doubt that the agreement, as pleaded and as construed, did not include Plankton Farms or Algalfields as parties, yet required those entities, according to Plankton, to comply with certain terms. Absent a pleading of a pre-incorporation contract (or an application to advance such a claim), it is difficult to see how non-existent parties, such as Algalfields, could be bound by the putative Joint Venture Agreement. There is no proper foundation for the contention that the matters left to be agreed were merely the mechanical detail. That does not accord with the finding correctly reached by the primary judge as to outstanding matters, nor does it deal with the question of when it was the parties agreed to be bound. These factors make it very difficult to conclude that there was a binding Joint Venture Agreement. 174 The primary judge was correct to conclude that: (a) the documents used language of discussion and with a view to the establishment of common ground; (b) there was no invitation for particular terms to be accepted, agreed or concluded in some way; and (c) none of the versions of the proposals relied on by Plankton provided for the terms to be agreed or adopted by signature on behalf of the parties. 175 Moreover, matters were left outstanding such as: (a) the email under which the V4 proposal was sent, contained an invitation for Mr Tracton to Mr Kerr to engage in further discussion on the proposal; (b) the language used in the V4 proposal was consistent with such ongoing discussions; and (c) the V4 proposal expressly contemplated that there would be both a shareholders agreement and a memorandum of understanding and, clearly, these would be in writing. 176 It was entirely open to the primary judge to conclude, as he did correctly, that on an objective view these matters in totality manifested an intention that any agreement was to be recorded in a subsequent formal instrument with not insignificant terms to be added at a time when the outcome of the application for the leases of the Site was known. Moreover, all of this was against a background in which no one knew what the Minister was going to say about the preferred ownership structure of the master lease holder. For example, the Minister may have considered that Rainstorm had assets and Plankton had not been able to raise finance to buy from Aurora. The only asset of Algalfields would be the master lease. But, in any event, the critical issue of the Minister's response was quite unknown. 177 It might also be said, in light of the background of Plankton's insistence on a formal confidentiality agreement, that the subject matter of the putative agreement being of very considerable commercial consequence to the participating parties would make it improbable that the parties intended to conclude a binding agreement without such detailed documentation. 178 There is nothing in the subsequent conduct to change this position. Rainstorm was not issued with any shares in Plankton Farms. Plankton had not challenged this finding. It is inconsistent with the term which Plankton says required Rainstorm to be issued with 20% of the shares in Plankton Farms. There was no evidence of any conduct consistent with such a term. Indeed, there was conduct inconsistent, such as the failure to incorporate Algalfields. It may well be that communications with solicitors were designed to put in place the incorporation of Algalfields, as were the communications with the Department designed to achieve the approval, but such communications do not constitute conduct showing unambiguously that the parties had reached agreement. That is entirely consistent with the parties then believing that they would reach agreement and needed to put certain things in place, principally securing lease approval. 179 Rainstorm is right to submit that such conduct must be unambiguous (Laidlaw v Hillier Hewitt Elsley Pty Ltd [2009] NSWCA 44 per MacFarlan JA (at [5]) (Beazley JA agreeing). It was not unambiguous as: the registration of Algalfields was consistent with a continuation of pre-contractual conduct; the Submission was hedged with qualifications, consistent with the parties not having concluded a binding agreement; Mr Tracton, through Plankton, started working on-site long before any putative agreement has been reached (on 1 August 2014). By October 2014, he had taken substantial steps towards commencing a commercial operation of DSA production on-site and the facilities were shared prior to November 2014. All of this was before the date of the putative agreement; Mr Tracton always intended to use a special purpose vehicle, as the parties knew. Plankton Farms was set up as a wholly owned subsidiary of Plankton but the shareholding was not split 80/20 as required by putative term 3; Mr Tracton was found to be keen to demonstrate his capabilities to Mr Kerr with the view to increasing the prospect of concluding the leases; and Mr Kerr was much involved in dealings concerning the activities of the cultivation of DSA, both prior to and after November 2014. 180 The ongoing activities on the Site after the 26 November 2014 date of the putative agreement fell well short of equivocally demonstrating that the parties intended to contract as pleaded.

Remaining grounds and their consideration 181 Grounds 2 and 3 deal with misleading or deceptive conduct while grounds 4 and 5 deal with estoppel. These subsidiary grounds of appeal are essentially just assertions that the primary judge was wrong in his conclusions on those matters. They raise nothing that has not been previously considered above. 182 The primary complaint of Plankton in this regard is that the analysis of the statutory claim was undertaken "in the shadow of his Honour's findings on the contract claim". It was a non-sequitur, Plankton argues, for his Honour to reject all the representations said to arise out of the Submission on the basis that it was necessarily implicit in the finding that no agreement existed, that Mr Tracton could not have been misled into thinking an agreement did exist. Plankton argues that the threshold to reach a conclusion that Mr Tracton was misled into thinking that a contract existed was lower than that required to determine whether a contract objectively construed actually came into existence. Far more material requires consideration than that which is permitted in an inquiry into whether a contract exists. Further, where a Court finds that a contract was not formed, it does not mean that someone was not misled into thinking that one was formed. Equally, it is argued that there is no necessary equivalence between a finding that a contract did not exist and a finding that it was likely one existed, that is, that there was a "real or not remote chance" having regard to all the surrounding circumstances that a person was misled into thinking that a contract had existed: Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 2 FCR 82 per Bowen CJ, Lockhart and Fitzgerald JJ (at 87). 183 Plankton argues that the relevant circumstances were such that it was likely that, even if not reaching the higher standard of a concluded agreement, the Submission and exchanges on 26 November 2014 nevertheless created a real or not remote chance that a person in Mr Tracton's position would think that there was a concluded agreement. Considering that the primary judge concluded that there was reliance, against which there is no cross-appeal, Plankton contends it was not open to seamlessly migrate the findings on the contractual claim to the misleading or deceptive conduct claim without appreciating the different analytical approach required for such a cause of action. 184 In the circumstances of this case, grounds 2-5 may be considered together. There is no doubt that the Submission did not objectively convey a representation to Plankton as to the existence of an enforceable agreement, either in the terms pleaded or at all. It was also entirely apparent that the primary judge did undertake a detailed contextual inquiry, closely examining all relevant circumstances relied upon and advanced in the trial in reaching his conclusion, both for the purposes of the parties' contractual intentions and in relation to the subsidiary alternative pleas of misleading representations and estoppel. These were negotiating commercial parties. Their commercial dealings were laid bare in the written communications and the contextual surroundings as reflected in the affidavit material. There was nothing unorthodox in the approach of the primary judge and it cannot be said that he did not clearly understand the plea of representations in relation to the subsidiary grounds. Nor can it be seriously contended that he did not set out the appropriate authorities and apply them. A finding was entirely open, having regard to all the material at the time of the Submission, that a reasonable person in Mr Tracton's position would not have concluded that there was a binding agreement between Plankton and Rainstorm. Nothing in the act of subscribing to the statements in the Submission, or in other pleaded activity, altered this finding. The Submission was directed to the Department for a particular purpose. That is not to say its content would prove to be inaccurate if approval was given in the form requested in the Submission. But approval was not forthcoming in the form requested, such that the parties did not enter into a binding Joint Venture Agreement on the terms the subject of previous proposals. 185 No error is demonstrated in relation to these subsidiary grounds of appeal.

CONCLUSION 186 The parties accept that costs should follow the event. As none of the grounds of appeal have succeeded, the appeal will dismissed with costs. I certify that the preceding one hundred and eighty-six (186) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices McKerracher, Reeves and Farrell.

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