(l) Ryledar's letter to Euphoric dated 15 March 1999 confirming, pursuant to cl 15.1 of the 1998 Agreement, a variation thereto asserted to be a re-wording of Euphoric's letter to Ryledar of 16 February 1999 which omitted any redraft of Item 4 of the Reference Schedule. In the letter of 15 March 1999 Mr Magar set out a new Item 4 of the Reference Schedule in the terms of that ultimately adopted in the 1999 Variation and further included what was referred to as typical examples of Ryledar's " delivered prices for each Zone " being the towns of Wagga, Queanbeyan and Coffs Harbour and determining a delivered price which assumed a " Rebate " of 6¢/litre.
151 The question which arises for determination is whether the foregoing documentation, combined with the undoubted fact that a 6¢/litre rebate was allowed by Euphoric in respect of deliveries to the limited number of sites outside the Rebate Area opened by Ryledar between May 1998 and March 1999, amounted to clear and convincing proof of a common intention on the part of both Ryledar and Euphoric that Ryledar would be contractually entitled under the 1999 Variation as a matter of enduring legal right to a rebate with respect to each and every site then existing or in the future to be opened by Ryledar in New South Wales outside its Sydney Metro locations. Further this intention was required of the 1998 Agreement to extend not only to the balance of the term of the 1999 Agreement but also to any Renewal Periods the subject of the exercise by Ryledar of the option in cl 3.2.
152 In essence, Ryledar's primary reliance in support of such a finding was the various examples referred to in the correspondence as "typical examples of Ryledar's delivered prices for each of zone" being the zones in respect of which differential freight charges would be applied.
153 The towns the subject of the various examples in the correspondence and which were located outside both the Rebate Area and the New Rebate Area, were confined to Coffs Harbour, Wandandian, Wagga, Queanbeyan, Forbes and Forster. In fact, the evidence established that between May 1998 and March 1999 the only service station sites opened by Ryledar located outside either Rebate Area were at Wandandian, Port Macquarie, Tuncurry and Wellington although service stations were opened at Kempsey, Coffs Harbour and Woolgoolga in April and early May 1999.
154 At one point during the argument, it was submitted by Ryledar that it was perfectly understandable why Euphoric would have intended to apply the Contractual Rebate to all sites located in New South Wales outside Sydney Metro locations as it had a discretion whether to include additional petrol retailing facilities acquired or licensed by Ryledar during the Term of the Agreement. However, this submission involves a misinterpretation of the definition of "Sites" which, for convenience I repeat:
"… the petrol retailing facilities, the names and locations of which are set out in Item 8 of the reference schedule. If during the Term Customer acquires or licenses any additional petrol retailing facilities, then such facilities shall be included in this definition at Euphoric's discretion. If additional retailing facilities are not included in this definition, Euphoric must provide just cause."
155 However, when one turns to Item 8 of the Reference Schedule it refers under the heading "Sites" to:
"All Sites in the State of New South Wales owned and/or leased by Customer and/or operated as 'Volume Plus' branded Sites under licence from Customer."
156 It was not suggested by Ryledar that the reference in Item 8 to "[a]ll sites in the State of New South Wales" was confined to those sites which Ryledar owned, leased or operated as at the date of the 1998 Agreement. This being so, the opening of new sites within New South Wales by Ryledar during the term of the Agreement did not require the exercise of Euphoric's discretion whether or not to include those sites within the definition. They automatically qualified.
157 Accordingly, the consequence of the asserted common intention of the parties advanced by Ryledar was that the 6¢/litre rebate would apply to each and every site irrespective of how many were opened by Ryledar anywhere in New South Wales outside the Sydney Metro locations either during the term of the 1998 Agreement or any renewal thereof pursuant to the exercise by Ryledar of its options to renew. It is that common intention which Ryledar seeks to attribute to itself and Euphoric as at 31 March 1999 on the basis of the limited number of examples of locations outside the New Rebate Area and the very limited number of actual petrol retailing sites to which Euphoric had allowed a 6¢/litre rebate in the period up to that date. As I have noted, Ryledar went so far as to submit that it was the common intention of the parties that the Rebate Area under the 1998 Agreement and the New Rebate Area under the 1999 Variation were to operate only as freight-free zones and not to govern, let alone confine, the areas to which the 6¢/litre rebate was to apply.
158 But even if it was the parties' common intention that the Rebate Area and the New Rebate Area were to be freight-free zones, it does not necessarily follow that it was also their common intention that those clearly defined areas were not to set the area limits for Ryledar's legal entitlement to a 6¢/litre rebate for Relevant Petroleum Products supplied to its sites with those areas.
159 The difficulty facing Ryledar is that first, the 11 February 1998 draft of the 1998 Agreement provided in Item 4 of the Reference Schedule that the contractual Rebate of 6¢/litre was to apply to all locations outside the Sydney Metro locations; second, Mr Hobbs changed Item 4 to Wollongong, Central Coast and Newcastle; third, Mr Magar did not object to that change and the 1998 Agreement was entered into accordingly; fourth, Ryledar propounded changes to Item 4 in the 1999 Variation which were accepted by Mr Hobbs which expanded the area to which the 6¢/litre Contractual Rebate was to apply but did not suggest that it be changed to all locations in New South Wales outside the Sydney Metro locations; fifth, Ryledar contends that the reason Item 4 was not changed to all of country New South Wales was that the parties intended that Item 4, although headed "Contractual Rebate", was unrelated to that subject matter and was concerned only with marking out the freight-free areas and zones.
160 The primary judge rejected this reasoning and in my view he was correct to do so. Given the experience in the petroleum industry of these parties and, in particular, that of Mr Beckwith who was a consultant to Ryledar and drafted the letters which Mr Magar signed, I would, with respect, regard the submission as fanciful.
161 Given the requirement, accepted by Ryledar, that the common intention for which it contends must be established by clear and convincing proof, in my opinion that onus is not discharged by the correspondence to which I have referred either alone or in combination with the invoicing practice of Euphoric during the period in question. Furthermore, as the primary judge also observed, such an asserted common intention would be completely at odds with the clear wording of Items 4 and 5 of the Reference Schedule both as contained in the 1998 Agreement as well as in the 1999 Variation.
162 Applying the principles which I have set out in [122]-[143] above, although it was never established that rectification is available in an appropriate area even where the words the parties have employed were purposely and deliberately used, the fact that those words convey a clear, unambiguous and unmistakeable meaning or legal effect renders it less likely that the parties were mistaken as to that meaning or effect. It further renders it less likely that they had a common intention which was fundamentally inconsistent with the words they had deliberately employed. To paraphrase the statement of Denning LJ referred to in [122] above, in the circumstances postulated it makes it difficult to accept that the parties were in complete agreement that as a term of their contract the 6¢/litre rebate would apply as a matter of contractual right to all of Ryledar's existing and future country sites, but by an error they wrote that term down wrongly when they agreed on the contents of Item 4 of the Reference Schedule both in the 1998 Agreement and the 1999 Variation.
163 Furthermore, I agree with the primary judge that it is simply impossible, given the very correspondence upon which Ryledar relies as constituting the clear and convincing proof of the common intention for which it contends, that given the opportunity in the 1999 Variation to make clear that intention, it failed to proffer wording for Item 4 to give effect to that intention. In other words, it is difficult accept that the correspondence upon which Ryledar relies evinced an intention on the part of both parties to provide Ryledar with a contractual right to a 6¢/litre rebate of the width of that contended for and then failed to implement that intention by the appropriate wording of Item 4 of the Reference Schedule. A fortiori as Ryledar was the party who proffered the detailed wording of Item 4 of the Reference Schedule as contained in the letter of 31 March 1999.
164 In my opinion the documentary evidence relied upon by Ryledar did not establish by clear and convincing proof that at the time of execution of the 1999 Variation both parties had an actual intention as to the legal meaning and effect of Items 4 and 5 of the Reference Schedule which was fundamentally inconsistent with the meaning and effect which the wording adopted by the parties clearly conveyed.
165 It therefore follows that even leaving aside the rejection by the primary judge of Mr Beckwith and Mr Magar's evidence as to their belief with respect to the effect of Items 4 and 5 of the Reference Schedule to the 1999 Variation, in my opinion neither the documentary evidence nor the conduct of issuing invoices which included the 6¢/litre rebate to a limited number of locations outside the Rebate Area and the New Rebate Area, whether taken jointly or severally, satisfies the onus on Ryledar to establish by clear and convincing proof the necessary common intention which the parties' written words failed to implement. I would therefore reject Ryledar's claim for rectification of either the 1998 Agreement or the 1999 Variation.
166 In the foregoing circumstances it is unnecessary to deal with Ryledar's submissions with respect to his Honour' rejection of Messrs. Beckwith and Magar's evidence as to their subjective state of mind with respect to their understanding of the effect of Items 4 and 5 in the Reference Schedule, whether as originally drafted or as varied. Nevertheless, I shall deal with the issue shortly.
167 Ryledar submitted first, that his Honour's credibility findings could not stand as they were inconsistent with the documentary evidence which, so it was submitted, made plain that both Ryledar and Euphoric had the common intention that the 6¢/litre rebate should apply "across the board". My rejection of the submission that the documentary evidence plainly evinced such an intention undermines that submission.
168 Second, it was submitted that those findings should be rejected upon the basis of a number of interventions by his Honour during the course of Mr Hobbs and Mr Magar's evidence. The bottom line to Ryledar's submission with respect to this issue was that the effect of his Honour's interventions was that there was no opportunity for senior counsel then representing Ryledar to cross-examine Mr Hobbs upon his evidence. It was submitted that his Honour had asked Mr Hobbs a number of leading questions as a consequence of which his evidence with respect to Euphoric's performance of the 1998 Agreement was "effectively neutralised". In these circumstances, his Honour ought not to have accepted Mr Hobbs' evidence over that of Mr Magar.
169 In my opinion there is no substance in these submissions. In any event, during the course of the hearing of the appeal, senior counsel for Ryledar was informed that unless and until he formulated an appropriate ground of appeal such as a denial of procedural fairness or some other basis which had some foundation in principle including the manner in which it deflected then senior counsel from pursuing his cross-examination of Mr Hobbs or his re-examination of Mr Magar, the Court would not entertain the excessive intervention argument.
170 As no amendment to Ryledar's grounds of appeal was proffered and no further submissions were made with respect to this issue, it follows that the Court's then view as to the validity of the intervention argument should be confirmed and Ryledar's submissions with respect to it rejected.
171 It follows that his Honour's credibility findings with respect to Mr Hobbs on the one hand and Messrs. Beckwith and Magar on the other are unimpeachable. The effect of his Honour' findings with respect to the credibility of those witnesses is his conclusion (at [72]) that Ryledar did not believe, as at 31 March 1999, that it was entitled as a matter of contractual right to a rebate of 6¢/litre on sales to country sites throughout the whole of New South Wales. Furthermore, his Honour found (at [51]) that Mr Magar had no genuine explanation as to how he could have misunderstood the plain meaning of the words in Item 4 of the Reference Schedule of both the 1998 Agreement and the 1999 Variation.
172 Furthermore, at [54] his Honour concluded that Mr Hobbs' intention with respect to what the 1999 Agreement should have reflected did not coincide with Mr Magar's evidence of his own understanding of what was agreed and intended by Item 4, even assuming that that evidence was accepted. There being no coincidence of intention between Mr Hobbs and Mr Magar, it followed that there was no basis for Ryledar's claim for rectification based on a common intention which had not been established to anywhere near the required standard of proof.
173 Finally, his Honour's conclusion at [99] bears repetition:
"I am far from convinced that Ryledar has proved its rectification claim. I regard as improbable the suggestion that Ryledar itself put forward wording for the amended Item 4 which was directly contrary to what it believed to be the actual agreement of the parties. I regard the pricing examples used in the correspondence between the parties prior to March 1999 as confused and confusing in so far as they bear upon the parties' intention as to Ryledar's entitlement to the 6¢ rebate to all locations after 13 April 1999 to be unequivocal evidence of a common intention as to that date that that entitlement be a term of the Supply Agreement rather than a commercial inducement or bonus which Euphoric, through Mr Hobbs, was prepared to proffer the keep Ryledar, as a substantial customer, happy."
174 It is apparent from that conclusion that the primary judge, in my view correctly, was not satisfied that Ryledar and Euphoric (and whether based on the documentary evidence or on the oral testimony of the relevant witnesses) had a common intention with respect to Ryledar's right under the 1998 Agreement and/or the 1999 Variation to a 6¢/litre rebate for all locations throughout New South Wales excluding the Sydney Metro area and that to the extent to which Ryledar held any such intention (which his Honour considered it did not), no such intention could be attributed to Euphoric.
175 It follows that based upon the documentary evidence and conduct of the parties with respect to invoicing, Ryledar has failed to establish some outward expression of a common accord of the parties which Items 4 and 5 of the Reference Schedule failed to express. The position is a fortiori with respect to the subjective state of mind of the parties as determined by his Honour in the light of the oral evidence and his credibility findings with respect thereto.