A full and detailed profit and loss report has not been prepared. Following however, is a summary report showing the values and percentages that we forecast will apply to stadium and function revenue. Our projections are made by applying appropriate spends per head to the level of stadium usage indicated in the Invitation to Tender.
27 The summary report includes an analysis of the revenue forecast in the first year broken up into Stadium Corporate, Stadium Public and Functions. That document shows that 47.12% of the revenue forecast to be made in the first year was expected to be generated by Functions, 29.82% of the revenue was expected from Stadium Public and 23.06% of the revenue was expected from Stadium Corporate. The net profit in relation to Functions was only 20% compared to Stadium Corporate at 29.50% and Stadium Public at 30%. The labour and overheads of the Functions were significantly higher than in the Stadium Corporate and Stadium Public sections of the forecast.
28 Schedule 12 also described the defendant as the "world's largest catering management and consultancy organization and referred to some 11, 000 clients worldwide serving more than one million meals per day." It included the description of the defendant's operations in seventy countries throughout the world and a statement that since its arrival in Australia in 1988 it had grown significantly to become "a leading force in contract catering, servicing many of Australia's major contracts" with an annual turnover in Australia of approximately $53 million.
Catering Rights Fee / Guaranteed Amount
29 The defendant agreed to pay a Catering Rights Fee in respect of Catering Services and External Catering. The parties agreed that such fee is to be calculated and payable in the manner set out in Schedule 1 of the Deed.
30 The Catering Rights Fee in respect of Catering Services is an amount equal to certain percentages of the annual gross revenue from Catering Services during the year ending 31 December. Those percentages commence at 10% up to $20 million of gross revenue, increasing by 1% for each $10 million capped at 20% for gross revenue from $29 million. The gross revenue is indexed according to the formula in paragraph 2 of Schedule 1.
31 The defendant agreed to pay to the plaintiff 3% of the gross revenue from External Catering. The defendant guaranteed that the fee would be no less than $3 million in any guaranteed year (cl 5.2, 5.3 and Sch. 4). However in the circumstances set out in clause 5.4 the defendant was released from its promise to pay that amount for that year.
The competing submissions on cl 5.4
32 The plaintiff submitted that, on a proper construction, clause 5.4 means that the defendant's obligations to pay the minimum guaranteed amount continue to apply except when the circumstances stipulated in either (a) or (b) of clause 5.4 apply. It was submitted that the circumstances stipulated by the words "of the Premier League / Union matches, all of those played in Sydney are not played at the Stadium" require that all of the members of a defined class, being those Premier matches played in Sydney, exhibit a certain characteristic, that is, that they are not played at the Stadium.
33 It was submitted that consequently, when either the defined class does not exist, that is, no Premier matches are played in Sydney that year, or some members of the class do not exhibit that characteristic, that is, some of the Premier matches played in Sydney are played at the Stadium, then the stipulated circumstance does not occur, the exception in 5.4(a) is not satisfied and the defendant's obligation under clauses 5.2 and 5.3 continue to apply.
34 It was submitted that each of the exceptions contained in clause 5.4 stipulates a universal negative, that is, all Premier matches are not played at the Stadium. Further that in the event of a positive case, that is, when at least one such Premier match is played at the Stadium, the relevant exception is not activated. It was also submitted that similarly, the exception does not apply when the defined class does not exist, that is, no Premier League / Union matches are played in Sydney that year at all.
35 The plaintiff submitted that the Arbitrator's process of reasoning in relation to the analogy "all soldiers were not killed" is incorrect because the analogy is incomplete. In short, it was submitted that the analogy omits all reference to the sub-class, all of those played in Sydney, within a class, of the Premier League / Union matches, to which the negative is applied in order to determine whether the exception in clause 5.4 has been triggered, thereby altering the sequence and structure, and therefore the meaning, of the phrase which falls to be construed.
36 It was submitted that the analogy is false because the statement "all soldiers were not killed" has no qualification as to location, unlike clause 5.4 which is concerned first with the class of Premier matches played in Sydney, and then with whether all were not played at the Stadium. For the analogy to be complete it is submitted the Arbitrator would have had to say something like "of all the soldiers killed in France, all were not killed at the Somme" and then construe the effect of the universal negative in its full context. It was also submitted that it is not helpful to approach the construction of clause 5.4 by reference to an analogy and that construction should have occurred of the words that are actually used in the sequence in which they appear.
37 The plaintiff submitted that the Arbitrator's construction was erroneous because that construction:
(a) converts the universal negative "all (are) not" into a negative universal, "not all are", which are not the words as used in the sequence in clause 5.4(a) or (b);