Hookey v Whitelaw[2021] QCA 181

SUPREME COURT OF QUEENSLAND

1. [1]
   SOFRONOFF P:  I agree with the reasons of Fraser JA and with the orders proposed by his Honour.

2. [2]
   FRASER JA:  In proceedings in the Trial Division the appellants, Mr Hookey and “Kids Academy”, claimed a declaration that on or about 1 July 2014 they and the respondents, Mr Whitelaw, “KA Estates” and “JBW Estates”, entered into a joint venture agreement in relation to the acquisition of land at Hope Island and the development of that land for the purpose of a childcare centre and the operation of a childcare business.  After a trial, the claim for that declaration and claims for other declarations and orders were dismissed.
3. [3]
   The appellants went to trial on their fourth further amended statement of claim.  They pleaded that “On about 30 June 2014, Hookey, Kids Academy and Whitelaw agreed for themselves and on behalf of a trustee (Land Trustee) of a new unit trust (Land Trust) which the parties intended to cause to be established (Joint Venture Agreement) to pool their respective skills and resources to form and/or undertake a joint venture to acquire the Land and to establish on the Land and operate the Child Care Business”.^[1]  The appellants pleaded that the joint venture agreement was made in discussions between Mr Hookey and Mr Whitelaw, the substance and effect of the words spoken to form it being agreement to 21 express terms.
4. [4]
   There were four primary issues for decision at trial.  Two remain in issue in this appeal:

   1. (a)
      Did Mr Hookey and Mr Whitelaw enter into the alleged joint venture agreement by 1 July 2014?
   2. (b)
      Are Mr Whitelaw, KA Estates, and JBW Estates estopped from acting other than in accordance with the terms of the alleged joint venture agreement?  (The issue framed by the trial judge included additional text, “and are they otherwise estopped from enforcing compliance with the registered lease [granted by KA Estates to Kids Academy] except with the consent of Mr Hookey”.  The appellants do not seek to agitate that issue on appeal.)
5. [5]
   Both issues were decided adversely to the appellants.

The first primary issue: did Mr Hookey and Mr Whitelaw enter into the alleged joint venture agreement by 1 July 2014?

6. [6]
   In relation to the first primary issue, the trial judge found Mr Hookey and Mr Whitelaw had not reached consensus upon the alleged terms of the joint venture agreement by 1 July 2014 and nor had they intended to be legally bound by any agreement.  The appellants challenge both findings.
7. [7]
   In relation to both findings, the question is what “would objectively be conveyed by what was said or done, having regard to the circumstances in which those statements and actions happened”.^[2]
8. [8]
   The effect of Mr Whitelaw’s evidence of his communications with Mr Hookey was that by 1 July 2014 he and Mr Hookey had not reached agreement upon the terms of any joint venture agreement.  Mr Hookey gave some evidence to the effect that he and Mr Whitelaw agreed upon a joint venture agreement before 1 July 2014, although much of his evidence was in very vague and general terms and he did not give any evidence at all about some of the alleged express terms.
9. [9]
   The trial judge primarily relied upon the contemporaneous documents.  The trial judge generally preferred the evidence of Mr Whitelaw to that of Mr Hookey.  The trial judge accepted Mr Whitelaw’s evidence that “at no point did [they] exchange words to the effect that they had an agreement, nor did they shake hands on such an agreement”.^[3]  The trial judge made adverse findings about Mr Hookey’s credibility and the reliability of his evidence.  He found it was a recurring theme of Mr Hookey’s evidence that he was demeaning of Mr Whitelaw, he was argumentative, he was evasive, he demonstrated a limited recollection of dates, he was unable to recall the actual oral terms of the alleged agreement, and there were inconsistencies between the terms said to arise from his conversations with Mr Whitelaw, a draft memorandum of agreement, and the pleaded terms of the alleged oral agreement.^[4]  The trial judge found “Mr Hookey’s evidence cannot be relied upon for the purposes of determining on the balance of probability, whether the parties had concluded an agreement by 1 July 2014.”^[5]
10. [10]
    The appellants do not seek to challenge those findings.  In an attempt to circumvent the fundamental problem those findings create for the appellants’ case, in this appeal they seek to construct an oral joint venture agreement from selected passages in Mr Whitelaw’s evidence, some of the contemporaneous documents, and some of the evidence about the parties’ post-contractual conduct and statements attributed to Mr Whitelaw.
11. [11]
    The appellants contend that the evidence to which they point demonstrates that by 1 July 2014 the parties had made an agreement by which they intended to be legally bound as a contract and which contained the “key terms”, albeit that they contemplated subsequent negotiation for further terms.^[6]  The “key terms” the appellants submit were agreed by 1 July 2014 are as follows:^[7]

2. “(a)
   Mr Whitelaw would provide the upfront funds to facilitate the bank borrowings required for a 50% share in the buildings and the business;
3. (b)
   Mr Whitelaw will receive 9% on his funds;
4. (c)
   Mr Hookey will receive interest on his expenses to date;
5. (d)
   Mr Hookey will cover the interest payments to Mr Whitelaw until the centre can do so, with that debt becoming a business debt;
6. (e)
   Mr Hookey will receive $1M following the sale of the business or the Land;
7. (f)
   Mr Hookey and Mr Whitelaw are “50/50 on everything”.”

12. [12]
    That is a very different agreement from the pleaded agreement upon which the appellants went to trial.  In the fourth further amended statement of claim the appellants alleged an oral joint venture agreement containing the following express terms:^[8]

2. “(a)
   The Land Trust was to be established (Term 1),
3. (b)
   The Land Trustee would acquire the Land in place of Hookey and with the benefit of the approvals already obtained by Hookey and would cause the Child Care Improvements to be constructed on the Land (Term 2),
4. (c)
   The Land Trustee would obtain a loan of approximately $6 million from a bank to pay for the cost of constructing the Child Care Improvements (bank loan) (Term 3),
5. (d)
   Hookey was to give a personal guarantee in respect of 50% of the bank loan (Term 4),
6. (e)
   Whitelaw was to lend approximately $3.5 million to the Land Trustee to pay towards the Land acquisition and development costs (Term 5),
7. (f)
   Upon completion of construction of the Child Care Improvements, the plaintiffs would establish, and Kids Academy would operate, the Child Care Business on and from the Land (Term 6),
8. (h)
   Kids Academy would be entitled to all receipts from the conduct of the Child Care Business (Term 7), and Kids Academy would make the following payments -

1. (i)
   Interest at the rate of 9% per annum to Hookey on monies (Term 8)-

3. (1)
   paid by him in relation to the purchase of the Land and its development as a child care centre up until 30 June 2014, estimated to be about $500,000, with payment of this interest to commence from the time of completion of the purchase of the Land, and

3. (2)
   loaned by him to the Land Trustee or Kids Academy from time to time, except to the extent specified by Term 11A (see paragraph 21(i) below),

2. (ii)
   Interest at the rate of 9% per annum to Whitelaw on (Term 9) -

3. (1)
   monies loaned by him to the Land Trustee including the initial loan of approximately $3.5 million, and
4. (2)
   additional monies loaned by him to the Land Trustee or Kids Academy from time to time,

3. (iii)
   Interest payable on the bank loan (Term 10),
4. (iv)
   All other expenses of the Land Trustee including those payable in respect of the Land, and all operating expenses of the Child Care Business (Term 11),

1. (i)
   In the event that Kids Academy was unable to pay interest to Whitelaw pursuant to Term 9 from the receipts of the Child Care Business, then Hookey was to pay that interest on behalf of Kids Academy, and any such payments would be taken to be a loan by Hookey to Kids Academy (Term 11A),
2. (j)
   Kids Academy was to operate the Child Care Business independently of all other Kids Academy child care centres (Term 12),
3. (k)
   If employees of other Kids Academy child care centres did work for Kids Academy, then Kids Academy would pay a management fee for that work (Term 13),
4. (l)
   Hookey or his nominee on the one hand and on the other hand Whitelaw or his nominee were equal beneficial owners of and had equal control respectively of Kids Academy, the KAHI Unit Trust, the Land Trustee and the Land Trust (Term 14).
5. (m)
   Notwithstanding Term 14 (Term 15)-

3. (1)

1. (a)
   Hookey or his nominee was to be the sole legal owner of all of the issued shares in Kids Academy,
2. (b)
   Hookey was to be the sole director of Kids Academy, and
3. (3)
   Hookey or his nominee was to be the sole legal owner of all of the issued units in the KAHI Unit Trust,

3. (2)
   Whitelaw was entitled to make a request to Hookey at any time -

1. (a)
   for shares in Kids Academy to be issued or transferred to Whitelaw or his nominee so that thereafter Whitelaw or his nominee would be the legal and beneficial owner of 50% of all of the issued shares in Kids Academy, and
2. (b)
   for Whitelaw to be appointed as a director of Kids Academy,
3. (c)
   for units in the KAHI Unit Trust to be issued or transferred to Whitelaw or his nominee so that thereafter Whitelaw or his nominee would be the legal and beneficial owner of 50% of all of the issued units in the KAHI Unit Trust,

3. (3)
   As soon as practicable after being requested to do so by Whitelaw, Hookey and Kids Academy would in accordance with the request each do all things which it was necessary for each of them to do to on their respective parts to cause Whitelaw to become a director of Kids Academy and or to cause Whitelaw or his nominee to become the legal owner of one-half of the issued shares in Kids Academy and or of one-half of the issued units in the KAHI Unit Trust,

3. (4)

1. (a)
   Whitelaw or his nominee was to be the sole legal owner of all of the issued shares in the Land Trustee,
2. (b)
   Whitelaw was to be the sole director of the Land Trustee, and
3. (c)
   Whitelaw or his nominee was to be the sole legal owner of all of the issued units in the Land Trust, and

3. (5)
   Hookey was entitled to make a request to Whitelaw at any time -

1. (a)
   for shares in the Land Trustee to be issued or transferred to Hookey or his nominee so that thereafter Hookey or his nominee would be the legal and beneficial owner of 50% of all of the issued shares in the Land Trustee,
2. (b)
   for Hookey to be appointed as a director of the Land Trustee, and
3. (c)
   for units in the Land Trust to be issued or transferred to Hookey or his nominee so that thereafter Hookey or his nominee would be the legal and beneficial owner of 50% of all of the issued Unit in the Land Trust.

3. (6)
   As soon as practicable after being requested to do so by Hookey, Whitelaw and the Land Trustee would in accordance with the request each do all things which it was necessary for each of them to do on their respective parts to cause Hookey to become a director of the Land Trustee and or to cause Hookey or his nominee to become the legal owner of one-half of the issued shares in the Land Trustee and or of one-half of the issued units in the Land Trust.

2. (n)
   If the Land was sold before the ownership of the Land Trust was changed pursuant to a request made by Hookey in accordance with Term 15, then the net sale proceeds (after payment of debts incurred by the Land Trustee in respect of the Land and pursuant to the Joint Venture Terms were to be divided equally between Whitelaw or his nominee and Hookey or his nominee (Term 16).
3. (na)
   If the Child Care Business was sold before the ownership of the KAHI Unit Trust was changed pursuant to a request from Whitelaw made in accordance with Term 15, then the net sale proceeds (after payment of the debts incurred by Kids Academy in respect of the Child Care Business and pursuant to the Joint Venture Terms were to be divided equally between SGH Enterprises Pty Ltd as trustee for the Hookey Enterprises Trust and Whitelaw or his nominee (Term 16A).
4. (o)
   The Land Trustee would permit Kids Academy to occupy the Land for the purpose of establishing and of conducting the Child Care Business and up until such time as Kids Academy sold the Child Care Business (Term 17).
5. (p)
   The payments made by Kids Academy pursuant to Terms 9, 10 and 11 were to be taken to be payments by Kids Academy to or on behalf of the Land Trustee of rent, outgoings and GST payable by Kids Academy to the Land Trustee in relation to its occupation of the Land (Term 18).
6. (q)
   Upon the sale of the Child Care Business, Hookey was to be paid $1 million by Kids Academy (Term 19).
7. (r)
   Whitelaw would not do any act or thing to cause the Land Trustee to terminate Kids Academy's occupation of the Land without the prior consent of Hookey (Term 19A).”

13. [13]
    The respondents contend that the appellants should not be permitted to litigate for the first time on appeal a claim that by 1 July 2014 the parties had concluded a binding contract containing only the suggested “key terms” now propounded by the appellants.  The appellants acknowledge that they did not propound such an agreement at trial.  They do not offer any explanation for their failure to do so.  It is evident even upon a cursory comparison between the terms of the agreement litigated at trial and the very broad “key terms” for which the appellants now contend that the appellants’ case on appeal is very different from the case litigated at trial.
14. [14]
    In Coulton v Holcombe,^[9] Gibbs CJ and Wilson, Brennan and Dawson JJ stated:

“It is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial. If it were not so the main arena for the settlement of disputes would move from the court of first instance to the appellate court, tending to reduce the proceedings in the former court to little more than a preliminary skirmish. The powers of an appellate court with respect to amendment are ordinarily to be exercised within the general framework of the issues so determined and not otherwise. In a case where, had the issue been raised in the court below, evidence could have been given which by any possibility could have prevented the point from succeeding, this Court has firmly maintained the principle that the point cannot be taken afterwards: see Suttor v. Gundowda Pty. Ltd [(1950) 81 CLR 418, at p 438]; Bloemen v. The Commonwealth [(1975) 49 ALJR 219].”

15. [15]
    Their Honours also endorsed the statement by the Court in University of Wollongong v Metwally (No 2):^[10]

“It is elementary that a party is bound by the conduct of his case.  Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had and opportunity to do so.”

16. [16]
    Those observations apply with particular force in a commercial case, such as this, which was managed to trial and in which the nature of the alleged joint venture agreement was of particular importance and was a particular focus in the litigation, including in evidence at the trial.  Whilst the evidence given by Mr Whitelaw and Mr Hookey was extensive and some questions were directed to the issue whether they had formed any binding agreement by 1 July 2014, different questions might have been asked about the question whether experienced businessmen like Mr Whitelaw and Mr Hookey would have bound themselves to the very broad “key terms” of the oral contract for which the appellants now contend.
17. [17]
    I am not persuaded that this is a case in which there is no possibility that, if the different joint venture agreement now sought to be established for the first time on appeal had been raised at the trial, the respondents could have adduced additional evidence to prevent the appellants from succeeding upon that different case.  The appeal should be restricted to the issues, including as to the nature of the alleged joint venture agreement, which were litigated at the trial.  As I will explain, however, the new case sought to be litigated on appeal would in any event fail upon the evidence adduced at the trial and the trial judge’s findings of fact.
18. [18]
    The trial judge made uncontroversial findings about the background to the alleged joint venture agreement:

    1. (a)
       Mr Hookey had considerable experience in the development and operation of childcare centres.  He and Mr Whitelaw were friends and saw each other very frequently.  Mr Whitelaw was a successful property developer.  Mr Hookey had obtained an approval from the local council to construct a childcare centre on land he had contracted to purchase.  He intended that Kids Academy would own and operate the proposed childcare business.  He was dealing with Westpac Bank in relation to the financing of the land purchase and the construction of the proposed centre.  He was unable to satisfy conditions of Westpac’s proposal for a facility offered to him on 18 February 2014.
    2. (b)
       Around that time Mr Hookey mentioned his interest in the proposed childcare centre to Mr Whitelaw.  On 7 April 2014 Mr Whitelaw sent an email to his accountant Mr Sayers referring to “preliminary discussions” with Mr Hookey and suggesting that he, Mr Sayers, Mr Hookey, and his accountant, should meet.  There followed many discussions between April and June 2014 about how they might cooperate in relation to the proposed childcare centre.  In April 2014, Mr Hookey indicated to Mr Whitelaw that the sale of the childcare centres, required for Mr Hookey to obtain funding from Westpac to buy the land for the proposed childcare centre, looked like not going ahead.  One possibility was that Mr Whitelaw might lend the money to Mr Hookey.
    3. (c)
       Mr Hookey gave evidence that before 15 April 2014 he proposed to Mr Whitelaw that, instead of Mr Whitelaw lending him the money, Mr Whitelaw and Mr Hookey have a 50/50 partnership in both the land and the business, each getting 50% of the profit from selling the land and from running and selling the business.  Mr Hookey mentioned that obtaining the approvals had cost him about $500,000 and a further $9.5 million was required to complete the centre, including the price of the land.  Mr Hookey suggested that Mr Whitelaw make a capital contribution of $4 million, with the rest of the monies to be borrowed by both of them from Westpac.  Mr Hookey’s evidence was that Mr Whitelaw responded that he was happy to look at it and he asked Mr Hookey to send him information to consider.
    4. (d)
       On 15 April 2014 Mr Hookey sent Mr Whitelaw information about the proposed development.  Mr Sayers gave evidence of attending the meeting foreshadowed in Mr Whitelaw’s email of 7 April 2014 and Mr Hookey and Mr Whitelaw discussing a proposal that they do a 50/50 joint venture.  Mr Sayers recommended a unit trust structure.  He said words to the effect, “You’ll both probably have a unit trust but you need to have a joint venture agreement” and a “Joint Venture Agreement needs to deal with the deal from conception to death”.^[11]
19. [19]
    Mr Hookey gave evidence in his affidavit that between 15 April and 30 June 2014, when he and Mr Whitelaw were both in Sanctuary Cove, they made many statements to each other about the proposed joint venture agreement terms.  After setting out these statements, Mr Hookey deposed that Mr Whitelaw responded he was “happy with all of that”.^[12]  In cross-examination, although Mr Hookey could not identify when any agreement was reached by reference to a date or event, or when any handshake occurred, when asked when the crux of the agreement was reached he stated that it was when they shook hands.^[13]  The trial judge found that this part of Mr Hookey’s evidence did not reflect well on his credit.
20. [20]
    Yet Mr Hookey’s evidence – including the evidence mentioned in the preceding paragraph – constitutes one aspect of what the appellants describe as “seven aspects of the evidence that establish or record the key terms of the agreement”.^[14]  In light of the trial judge’s adverse findings about Mr Hookey’s credibility and the reliability of his evidence of the alleged joint venture agreement his evidence could not support the appellants’ case.
21. [21]
    The initial proposal was for a 50/50 partnership or joint venture, under which Mr Whitelaw would contribute $4 million capital and Mr Hookey and Mr Whitelaw would borrow the balance of the money required for the estimated outlays of a further $9.5 million.  That proposed arrangement became impracticable when Westpac made it clear in early July 2014 that it would not lend the money to Mr Hookey but would lend it to Mr Whitelaw upon certain conditions.^[15]
22. [22]
    The possibility that Westpac would impose conditions that might require the parties to negotiate a different kind of arrangement must have been foreshadowed by 26 June 2014, when Mr Whitelaw sent an email to Mr Sayers, containing the following text:

“As discussed the other day ill try and give you the gist of what i / we are trying to do.  Acquire a site for a new child care centre, construct the building and operate the facility.  Globally the numbers are in the region of $10m.

To date Scott has funded the DA/BA and all associated planning and acquisition costs (circa $500k), the site is all good to go from a construction perspective. As you know there has been a lot of back and forth in my mind as to what i want to do. The position now is that i will provide the upfront funds to facilitate the bank borrowings required for a 50% share in the buildings and the business. Its agreed that i will receive 9% on my cash. Its also agreed that Scott once he has actual figures for his expenses to date will receive interest. In the short to medium term its agreed Scott will cover my interest until the centre can do so. This cost will become a business debt. My role will be very much in the background. In addition to this I've agreed for Scott to receive $lm following the sale of the business the rest to be divided equally.

That’s pretty much the guts of it. The issues that need resolving are the structures etc, for example, banking the deal at this stage looks like it will need to be done in my own name or 100% owned entity with Scotts firm signing up as the tenant. This is how West Pac would like it done. We are speaking to other lenders their view may differ. Bottom line is once we have an agreement in principle with a bank that will dictate how we do it. We will need to have side agreements which effectively get us back to the 50/50 which we are both happy with.

As i think i told you Scott had this whole deal approved with Westpac subject to the sale of his leasehold business which fell over at the final hour as a result Scott has stacks of docs relating to every aspect of the proposal and his existing business, could you give me idea of what you'd like to see, the whole lot would be a weeks reading!! The figures that are most relevant to me re the running of the centre are, at what point do we break even, that appears to be around the 50% occupancy level. Scotts existing 10 centres are running at l02% my sisters are also running at that level. I'm obviously also very focussed on the budget re build and setting up.

Regarding the timing of all this we really need to have it boxed off by the end of July at the latest, the vendors have been very agreeable and will work in with us in terms of structure etc. Ideally id like to think we can schedule a meeting at yours some time week beginning 7^th July. Its proposed that Scott will organise for his accountant to attend which i think is a good idea so we are all on the page.”^[16]

23. [23]
    That email is another aspect of the evidence upon which the appellants rely as proof of the “key terms” of the agreement.  The appellants emphasise the references to Mr Hookey and Mr Whitelaw having a 50 per cent share and to agreed matters.  The appellants’ argument that this evidences a binding agreement misconstrues those statements by divorcing them from the context in which they appear.  Most notably, the purpose of the email is described in the first sentence as an attempt to give Mr Sayers the “gist” of what Mr Whitelaw and Mr Hookey were “trying to do”.  Mr Whitelaw sent the email to his accountant for the expressed purpose of obtaining advice, including upon figures that were “most relevant” to Mr Whitelaw about the running of the centre, the break-even point, and the budget to build and set up the centre.  The email conveys that it remained necessary to resolve the structure of the arrangements, including the identity of the parties to the proposed venture, and the structure would be influenced by the requirements of the bank that financed the transaction.  The last sentence also indicates that Mr Whitelaw and Mr Hookey had not concluded an agreement upon the terms of the proposed venture.
24. [24]
    The appellants submit that the primary judge did not address important parts of the email and instead relied only upon evidence about Mr Whitelaw’s understanding.  The primary judge quoted the first paragraph of the email, which makes it plain that the email could not be regarded as evidence that the parties had concluded an oral joint venture agreement.  I have addressed the email at greater length only because it appears to be the central plank of the appellants’ argument that contemporaneous documents support the appellants’ case that the parties had concluded an oral joint venture agreement by 1 July 2014.
25. [25]
    The third aspect of the evidence upon which the appellants rely to establish or record the “key terms” of the agreement comprises three paragraphs of Mr Whitelaw’s affidavit.^[17]  In the first of the cited paragraphs Mr Whitelaw explained statements in his email of 26 June 2014.  Mr Whitelaw stated as follows:

    1. (a)
       He did not believe he had entered into any agreement with Mr Hookey.
    2. (b)
       He was seeking advice from Mr Sayers about how such a deal could be structured and what issues would be involved.
    3. (c)
       Whilst he was confident of being able to lend money for the development he understood that any arrangements might be affected by the requirements of the bank.
    4. (d)
       He was very focused on the budget because a large initial investment was required of him to buy the land and construct the buildings.  He wanted to ensure that his investment was secure.
    5. (e)
       Whatever the arrangement was to be, it had to be formalised before the end of July since Mr Hookey had already obtained extensions of the settlement date from the vendor.
26. [26]
    The first and the fifth statements obviously do not assist the appellants.  The second, third and fourth statements make it seem very unlikely that Mr Whitelaw, would have signified agreement to an oral joint venture agreement expressed in the general language of the 26 June 2014 email, which would require him to contribute substantial capital to the venture.
27. [27]
    The trial judge referred to Mr Whitelaw’s affidavit evidence about what he sought to do by the 26 June email.  That evidence substantially reflected the content of the email.  Contrary to one of the appellants’ arguments, the trial judge was not led into the error of treating evidence of Mr Whitelaw’s unexpressed intention as proof of the absence of an intention to contract.
28. [28]
    The second cited paragraph of Mr Whitelaw’s affidavit also makes it seem improbable that Mr Whitelaw would have expressed agreement upon the terms of a joint venture at that time: Mr Whitelaw there deposed that he recalled that about the time he sent the email “I had not attended to important issues regarding the structure of my investment, including the company or trust that would acquire the land and the owner[s] of that entity; and that I had to get Mr Sayers’ advice on this.”
29. [29]
    The third cited paragraph of Mr Whitelaw’s affidavit states:

“Broadly speaking, by around 30 June 2014, my understanding of the essence of the arrangement we had been discussing in our numerous conversations was that we would proceed as follows:

1. (a)
   I would buy the land, construct the child care centre, borrow money for the purpose of constructing the building on the Land and I would become the sole owner of the Land and the Landlord under a lease.
2. (b)
   Mr Hookey would own and operate the Business and be responsible for all income and the payment of all ongoing costs and expenses including rent from the Business income.
3. (c)
   My capital would receive a return on investment of 9% per annum, to be paid by Mr Hookey or Kids Academy from the Business.
4. (d)
   I would reimburse Mr Hookey for the preliminary development costs he had incurred (which I understand were around $500,000 – I referred to these as a white paper costs) and in the meantime I would receive payments at 9% per annum.
5. (e)
   Upon a sale of the Business, Mr Hookey would receive $1 million, for his skill and expertise in setting up, running and operating a successful Business.
6. (f)
   If either the Land or the Business was sold, we would share equally in the profit or uplift.”

30. [30]
    Consistently with Mr Whitelaw’s evidence, the trial judge referred to that passage of Mr Whitelaw’s affidavit evidence as “Mr Whitelaw’s understanding of the essence of the proposed arrangement as discussed with Mr Hookey”.^[18]  This is not an admission of a concluded agreement.  It describes only “the essence” of an “arrangement” Mr Whitelaw and Mr Hookey “had been discussing”.
31. [31]
    The same is true of Mr Whitelaw’s evidence in cross-examination about the 26 June email which is extracted in a document (“Pleaded Terms referred to in Whitelaw cross-examination”) scheduled to the appellants’ outline of submissions.

    1. (a)
       The first reference to the 26 June email concerns item 9 in the schedule (alleged express term 8: “Kids Academy would pay interest to Scott at 9% on initial $500k and future loans”).  In cross-examination Mr Whitelaw gave evidence that, whilst the 26 June email refers to it being agreed that once Mr Hookey had actual figures for his expenses to date (“circa $500k”) he would receive interest, the email did not say whether that interest would be calculated from a date before settlement or from a date after settlement.^[19]  That incompleteness  in the arrangement is consistent with the trial judge’s finding that the parties had not concluded an agreement.
    2. (b)
       In relation to item 16 (alleged express term 14: “Hookey and Whitelaw equal beneficial owners of Kids Academy and KA Estates”), it was put to Mr Whitelaw that the statement in the email, “the position now is I will provide the upfront funds to facilitate the bank borrowings required for a 50 per cent share in the buildings and the business”, was a positive statement of his position as at 26 June which he was saying was true.  Mr Whitelaw responded, “I’m saying I’m providing information to my financial advisor accountant” and “that’s what we have spoken about, so I’m saying comments, thoughts, please.”^[20]  This evidence of Mr Whitelaw’s state of mind accords with the text of his email.
    3. (c)
       With reference to the same alleged express term, Mr Whitelaw agreed that in the 26 June email he was telling Mr Sayers that he would have to have some side agreements to make sure he “can get back to the fifty-fifty which you’re both happy with”.^[21]  The absence of any agreement about even the main terms of any side agreement and the circumstance that the nature of any such arrangement was anticipated to depend upon the financier’s then uncertain requirements are stark indications of the incompleteness of the proposed arrangement, only “the gist” of which was described in the email.  This is also consistent with the trial judge’s finding.
32. [32]
    The appellants rely upon an exchange of emails on 17 and 18 June 2014 involving Mr Whitelaw, Mr Hookey and Mr O'Malley (the builder of the childcare centre).  Mr Whitelaw referred to an unrelated deal from which he would obtain funds for the proposed joint venture.  Mr O'Malley stated that Mr Hookey had asked him to prepare a contract.  Mr Hookey replied, “I think we will both sign it as individuals for the moment.  We have not set the structure up as yet so we can just add “or nominated parties” after our names on the contract.”  At its highest, this indicates only that the parties then contemplated entering into an agreement of some kind.  On 17 June 2014 Mr Hookey sent an email to Mr Whitelaw attaching a spreadsheet which modelled financial consequences of “50% and 75% occupancy”. The email stated that, “As usual these numbers have a bit of guesswork involved, so don’t hold me to them”, and he referred to different ways in which the bills might be paid.  Mr Whitelaw replied that “the boys are all pretty happy, so all good.  Have a look later”.  The “guesswork”, non-binding nature of the budget for the childcare business sent to Mr Whitelaw on 17 June 2014 (to which the trial judge referred)^[22] makes it seem unlikely that he would have committed to a joint venture agreement at that time.  Mr Whitelaw’s final response that he would “Have a look later” is hardly the language of agreement.
33. [33]
    The appellants challenge a finding by the trial judge that there was no evidence that Mr Hookey had any oral discussions with Mr Whitelaw regarding the proposed venture whilst Mr Hookey was overseas between 16 May and 20 June 2014.  Mr Hookey’s own evidence of statements made by Mr Whitelaw between about 15 April and 30 June 2014 was prefaced by his reference to those statements being made when he and Mr Whitelaw were both in Sanctuary Cove.  The appellants pointed to evidence of phone calls between the two men in the period when Mr Hookey was overseas, but the appellants were unable to refer the Court to evidence of any relevant discussion in the period whilst Mr Hookey was overseas.
34. [34]
    Mr Whitelaw and Mr Hookey had a meeting with Mr McGrath, a senior relationship manager for Westpac, on or about 1 July 2014.  An indicative term sheet sent by Westpac to Mr Whitelaw on 2 July 2014 contemplated that Westpac would provide to Mr Whitelaw a facility for an amount of $6 million as an interest only loan.  The conditions precedent included a requirement that a copy of the lease between Mr Whitelaw or his entity and Mr Hookey’s entity be provided to Westpac for legal review.  On 2 July 2014 Mr Hookey instructed his solicitors that the draft lease supplied by them that day should be changed so that it included that the centre was to be fully fitted out by the landlord with the necessary equipment to open and run a childcare centre.^[23]  (The final form of the lease included a provision requiring the landlord to construct the building, the landlord’s works to be completed and include all fixtures, fittings and chattels to the extent required for the lessee to comply with all State licensing and regulations relating to the operation of a child care centre.)
35. [35]
    Mr Hookey deposed in his affidavit that before the meeting, Westpac, through Ms Pienaar, had explained to Mr Hookey that Westpac required Mr Whitelaw or his entity to own 100 per cent of the land and develop the land for a childcare centre and that Mr Hookey’s entity lease the childcare centre.  The trial judge rejected oral evidence by Mr Hookey that, despite these requirements, Ms Pienaar would allow Mr Whitelaw and Mr Hookey to structure their partnership as they saw fit and what structure they created was totally up to them.^[24]
36. [36]
    The trial judge accepted evidence by Mr Whitelaw that, before the meeting on 1 July 2014, Mr Hookey told him that Westpac would not lend Mr Hookey the money for the development.^[25]  Mr Hookey swore that, before the meeting, Mr Hookey said to Mr Whitelaw that, to satisfy the bank’s requirement that funds be advanced by Westpac only to Mr Whitelaw, Mr Hookey would stay as the sole director, shareholder and unitholder of Kids Academy “and at some point when it is appropriate, we can adjust the ownership so that it is 50:50 in accordance with our agreed shares”.^[26]  As I will explain, the evidence supported the trial judge’s finding that the parties did not reach any consensus about such an adjustment of the beneficial ownership of Kids Academy.
37. [37]
    The fourth aspect of the evidence submitted to establish or record the “key terms” of the agreement is described by the appellants as “the 10 July 2014 ‘heads of agreement’ document”.^[27]  That is a misnomer.  The document – an unsigned draft – describes itself as “Heads of Agreement – Hope Island Child Care Centre 1^st July 2014”.  The trial judge found Mr Hookey commenced drafting the heads of agreement on or about 1 July 2014. ^[28]  The trial judge rejected Mr Hookey’s evidence that he typed the heads of agreement during a meeting with Mr Whitelaw at Mr Hookey’s house on 10 July 2014.  On that day Mr Hookey emailed the heads of agreement to Mr Whitelaw, Mr Watson, and a solicitor, Mr Radcliff, who had acted for Mr Hookey in relation to the original contract to purchase the land and who, as at 10 July 2014, was acting for KA Estates in relation to its purchase of the land.  Mr Whitelaw attempted to send the document to Mr Sayers on the same day, and in his email he referred to him and Mr Hookey having made progress that morning.  The trial judge accepted Mr Whitelaw’s evidence that he discussed the heads of agreement with Mr Hookey on 10 July 2014 but he did not jointly draft the document with Mr Hookey.
38. [38]
    Unsurprisingly, the trial judge rejected Mr Hookey’s evidence that the date “1^st July 2014” was a typographical error for “10^th July 2014”.  When Mr Hookey was asked to explain how that could be a typographical error, he responded:

“No, that’s what bothered me as well.  That’s why I thought it can’t be a typo.  I think that because everything was from the 1^st when we went with Brett [Mr McGrath of Westpac], once Brett left Johnno said, “Well, I think we better start putting a bit of this on paper so that we can try to get it fixed up”.  So it may well be that I went home that night and just started to type a couple of things in and work out what was – what was our little agreement, which sat in behind the – the formal agreement.”^[29]

39. [39]
    The appellants challenge the trial judge’s finding that Mr Hookey commenced drafting the heads of agreement on 1 July 2014.  They submit the finding was contrary to six pieces of evidence.  The first and second pieces of evidence comprise Mr Hookey’s affidavit evidence and his evidence in cross-examination.  That submission again overlooks the trial judge’s unchallenged findings about Mr Hookey’s credibility and the reliability of his evidence.  The next three pieces of evidence comprise a reference in Mr Hookey’s diary to a meeting on 10 July 2014, Mr Whitelaw’s statement in his email to Mr Sayers on 10 July reporting that he had made good progress that morning on their agreement, and Mr Whitelaw’s evidence in which he agreed it was possible he had discussed the drafting of the heads of agreement with Mr Hookey over the phone but he denied he had “sat down with Mr Hookey”.  None of this is inconsistent with the trial judge’s finding or the reasons for that finding.  The final piece of evidence is trivial: the heads of agreement contains the word “circa”, a word which Mr Hookey did not use in his correspondence, but Mr Whitelaw did use generally.  Notably, the appellants’ argument does not explain the date “1^st July 2014” on the heads of agreement.
40. [40]
    As the trial judge considered, the fact that Mr Hookey was drafting the heads of agreement by himself on 1 July 2014 supports the finding that the parties had not entered into any oral joint venture agreement by that time.^[30]  The trial judge also found that it followed from Mr Hookey’s explanation for the suggested typographical error that he appreciated that Mr Whitelaw required any joint venture agreement to be reduced to writing.^[31]  No reason appears to doubt the accuracy of that finding.
41. [41]
    The appellants challenge the trial judge’s additional finding that Mr Hookey knew that the parties were obtaining independent legal and/or accounting advice.  They argue that finding is not supported by evidence of Mr Hookey cited by the trial judge that, when Mr Hookey was asked his purpose in drawing up the heads of agreement, he responded “… the only reason, really, was to let our accountants and people know what we were looking at doing.”^[32]  It must have been apparent to Mr Hookey at least from the time of the meeting foreshadowed in the 7 April 2014 email that Mr Sayers was advising Mr Whitelaw about the proposed joint venture.  Mr Hookey gave evidence that he presumed that he would have discussed the heads of agreement with both Mr Watson and Mr Radcliff.^[33]  That part of Mr Hookey’s evidence was supported by the fact that Mr Hookey’s email of 10 July 2014 enclosing the heads of agreement was copied to Mr Watson and Mr Radcliff.  The trial judge referred to Mr Hookey’s evidence that he presumed Mr Whitelaw wanted to send the document to Mr Sayers, and Mr Hookey also sent it to Mr Radcliff and Mr Watson “Because both of those people were aware of the fact that John and I were trying to finalise this agreement”.  So “it was important that they saw what John and I had agreed on”.^[34]  The evidence justified the inference that Mr Hookey knew that each of the parties were obtaining independent legal and/or accounting advice.
42. [42]
    The nature and terms of the “Heads of Agreement – Hope Island Child Care Centre 1^st July 2014” reinforces the conclusion that the parties had not entered into any joint venture agreement by 1 July 2014.  The heads of agreement provides:

2. “a.
   [Mr Whitelaw] and [Mr Hookey] will own KAE equally.
3. b.
   Mr Whitelaw and Mr Hookey will own KAHI equally.
4. c.
   KAE is the entity that will own and build the child care centre.
5. d.
   KAHI is the entity that will run the child care centre.
6. e.
   No formal lease will need to be in place as KAHI will be the trading entity responsible for all moneys in and out as well as all other payments including bank interest and interest payable to both [Mr Whitelaw] and [Mr Hookey].
7. f.
   [Mr Hookey] has contributed approximately $500K(to be substantiated) cash towards KAE and has been granted $1M contribution for his IP towards KAHI. The $1M is to receive no interest however it will be considered as a debt on the sale of the business.
8. g.
   [Mr Whitelaw] is to invest sufficient capital to acquire the site and facilitate the construction and set up of the centre circa $3.5M.
9. h.
   [Mr Hookey] and [Mr Whitelaw] will be paid 9% interest on their cash input. [Mr Hookey] $500K interest will accrue from the date of the settlement of the land.
10. i.
    [Mr Whitelaw]’s interest on capital will be met by [Mr Hookey] from private funds again from the date of settlement. When the business can afford to meet these payments the amount of money paid to [Mr Whitelaw] by [Mr Hookey] will be collated and become a debt of the business, to be returned to [Mr Hookey] as soon as viable. This amount owed to [Mr Hookey] will not attract interest.
11. j.
    KAE is to secure finance from a bank to construct the building. This loan will be circa $6M. Although KAE may be in [Mr Whitelaw]’s name, [Mr Hookey] guarantees 50% of this loan personally.
12. k.
    KAHI is to be operated as a completely separate entity to all the other Kids Academy businesses. However shared staff will need to be paid for by way of a management fee.

The agreement between [Mr Hookey] and [Mr Whitelaw] is that both parties will own equally the KAE and KAHI entities.

The initial structure/entities will be put in place to accommodate the financing of the construction. These entities/structures are to revert to the initial shareholdings as in points a and b as soon as financing is in place. The entities/structures that are put in place now should be done so as not to incur further stamp duties at a later date.”

43. [43]
    The trial judge found that, whilst Mr Whitelaw discussed some of the terms of the heads of agreement with Mr Hookey, Mr Whitelaw did not agree those terms.  The appellants challenge that finding.  It is supported both by evidence given by Mr Whitelaw which the trial judge could and did accept, and by the facts that Mr Hookey prepared the heads of agreement, he and Mr Whitelaw discussed it, neither of them signed it, and the terms (most obviously paragraph e) plainly required substantial amendment in light of Westpac’s conditions of finance.
44. [44]
    Mr Whitelaw said in cross-examination that they discussed k, which was agreed if the agreement was to proceed, but they did not agree upon the terms.  Mr Whitelaw did not agree that each of the paragraphs of the heads of agreement set out the terms of his agreement with Mr Hookey.  He gave evidence that “right at the guts of that is … E, where no formal lease will be required”.^[35]  If the first phrase in (e) were omitted, Mr Whitelaw “would agree that a lot of the points we discussed at length many times”, but there were not things he had agreed.^[36]  Mr Whitelaw “gave the document scant attention because as soon as I read E, I thought the document was a nonsense”.^[37]  “We thought we were doing a fifty-fifty agreement and that’s what we were trying to do … The plan to do a fifty-fifty was still absolutely what we were trying to do at that point in time … I don’t know that we’d agreed.  I think we were trying to do it.”^[38]  “I don’t accept that there was a – an agreement.  Agreement in my mind had to be a written documented agreement … signed … well, I’ve never had a verbal agreement in commercial – in business”.^[39]  That and other, similar evidence by Mr Whitelaw was drawn to the Court’s attention during the hearing of the appeal, but none of it amounts to an admission by Mr Whitelaw that any agreement had been concluded.
45. [45]
    The trial judge’s conclusion^[40] that Mr Hookey’s conduct in commencing to draft the heads of agreement on 1 July 2014 was done to continue negotiations, rather than as an attempt to document any existing agreement, is confirmed by the trial judge’s comparison of significant terms of the heads of agreement with uncontroversial facts:

“As to clause (a) of the heads of agreement, at no time did Mr Whitelaw and Mr Hookey own KA Estates equally. Nor did they at any time own the KAHI Unit Trust equally. Clause (e), which states that no formal lease would be required, contradicts Westpac’s specific requirement for a lease which was communicated on 2 July 2014. As to clause (g), this envisaged that Mr Whitelaw would provide all the capital for the project except for the $500,000 that Mr Hookey had already contributed. This is in stark contrast to what had been discussed, namely that Mr Whitelaw would make a cash contribution but that bank borrowings would be obtained by both Mr Whitelaw and Mr Hookey through an entity which they equally controlled. This change is, in my view, significant. It is reflected in clause (j) of the heads of agreement, which contemplated KA Estates securing finance in the order of $6 million from Westpac to construct the childcare centre. Clause (j) thereafter provides: “Although KAE may be in Mr Whitelaw’s name, Mr Hookey guarantees 50% of this loan personally”. No such guarantee was ever forthcoming from Mr Hookey. Nor was there any mention of Mr Hookey providing a personal guarantee for 50% of any bank loan in any of the conversations between Mr Hookey and Mr Whitelaw prior to 1 July 2014. The requirement for Mr Hookey to give a personal guarantee in respect of 50% of the bank loan is nevertheless pleaded as an express term.”

46. [46]
    It is quite apparent that Westpac’s decision about the terms upon which it was prepared to finance created a practical impediment to an agreement of the kind discussed up to late June 2014. The execution of the lease that was required by Westpac’s decision also created an obstacle to reliance upon an oral joint venture agreement as a binding contract; the registered lease was inconsistent with clause (e) of the heads of agreement and (at least) the pleaded express Terms 17 and 19A of the alleged joint venture agreement.^[41]
47. [47]
    As the trial judge found, the heads of agreement did not contain the express terms of the joint venture agreement pleaded in subparagraphs 21(b) to (r) of the fourth further amended statement of claim.  The appellants challenge that conclusion but it is self-evident upon the face of the two documents.  Furthermore, as the trial judge concluded, upon the evidence, express terms 14, 15, 16 (the existence of which depended upon the existence of term 15), 17 and 19A were not discussed or agreed.  (Mr Hookey gave some evidence about alleged term 15 but that evidence was not accepted.^[42])
48. [48]
    The trial judge compared terms of the heads of agreement with pleaded terms of the alleged joint venture agreement:^[43]

“Clause (e) of the heads of agreement states that “no formal lease will need to be in place as [Kids Academy] will be the trading entity responsible for all moneys in and out as well as all other payments including bank interest and interest payable to both [Mr Whitelaw] and [Mr Hookey]”. Clause (e) of the heads of agreement was generally in the same terms as identified in the affidavit of Mr Fraser, the solicitor for Mr Hookey. The present proceedings were initially commenced by an application for interim injunctive relief to restrain the defendants taking any steps to recover possession of the land the subject of the registered lease. In support of that application, Mr Fraser swore an affidavit on instructions from Mr Hookey. Mr Hookey later swore that the contents of Mr Fraser’s affidavit were true and correct. Mr Fraser’s affidavit identified Term 7 of the joint venture agreement as being “g. the unit trust and [Kids Academy] would not enter into a formal lease”. In the first version of the statement of claim the plaintiffs pleaded in paragraph 21 the following express term:

2. “(g)
   As between the Land Trustee and Kids Academy, no formal lease document was necessary, and notwithstanding the terms of the formal lease which the Land Trustee and Kids Academy may need to put in place to satisfy a precondition to the advance of the bank loan, the terms of that formal lease would not be enforced by Estates against Kids Academy.”

This term is now pleaded as follows: [The trial judge quoted Terms 17, 18 and 19A of the oral joint venture agreement pleaded in the fourth amended statement of claim.]

The shift in the plaintiffs’ case is that the express terms as now pleaded implicitly recognise that Kids Academy’s occupation of the improved land would be governed by a lease and that Mr Whitelaw would not terminate Kids Academy’s occupation of the land pursuant to the lease without the consent of Mr Hookey. There is no evidence that Term 19A was discussed by Mr Hookey and Mr Whitelaw, let alone agreed prior to 1 July 2014 and I make those findings. Similarly, in respect of pleaded Term 17, Mr Hookey accepted in cross-examination that he never discussed such a term with Mr Whitelaw.

The second difference concerns the mechanism which would trigger each party receiving their 50% interest. Under both the heads of agreement and the pleaded terms, Mr Hookey was to give a personal guarantee in respect of 50% of the borrowings from the bank. Mr Hookey never provided this personal guarantee. As to the timing, however, the heads of agreement provided that Mr Whitelaw and Mr Hookey would own KA Estates and the KAHI [Unit Trust] equally “as soon as financing is in place”. This is to be contrasted with the pleaded Terms 14 and 15. Term 14 acknowledged that Hookey or his nominee on the one hand, or Whitelaw or his nominee on the other hand, were equal beneficial owners of the relevant entities. Term 15 provided that notwithstanding Term 14, Hookey or his nominee was to be the sole director and sole legal owner of all the issued shares in Kids Academy and of all the issued units in the KAHI Unit Trust. Similarly, Whitelaw or his nominee was to be the sole director and sole legal owner of all the issued shares in the Land Trustee (KA Estates) as well as the issued units in the land trust. Clause 15, however, permitted either Hookey or Whitelaw “at any time” to request the transfer of 50% of the shares and units in the relevant entities.”

49. [49]
    The disconformity between the heads of agreement, which Mr Hookey commenced to draft on 1 July 2014, and the terms of the pleaded joint venture agreement, coupled with the absence of any evidence supporting the existence of express terms 14, 15, 16, 17 and 19A, create a formidable obstacle both for the appellants’ pleaded case and the case on appeal that some other joint venture agreement had been concluded by 1 July 2014.
50. [50]
    The contemporaneous documents support the trial judge’s finding that Mr Whitelaw and Mr Hookey had not reached any consensus upon the terms of a joint venture agreement by 1 July 2014.
51. [51]
    As I have indicated, the appellants rely upon evidence of conduct and statements after 1 July 2014 in support of their case that the trial judge erred in finding that the parties had not made a joint venture agreement by 1 July 2014.  One difficulty with this argument is the implausibility of a proposition that the general conduct and statements upon which the appellants rely could overcome the effect of the contemporaneous documents in the period up to 1 July 2014 as support for Mr Whitelaw’s accepted evidence.  Another difficulty for the appellants’ argument is the improbability that the subsequent conduct and statements could establish the necessary objective intention that any consensus made by the parties by 1 July 2014 was intended to be legally binding upon them by that same date.
52. [52]
    The trial judge referred to evidence given by Mr Hookey’s accountant, Mr Watson, that in a telephone conversation on 2 July 2014 Mr Sayers made the following statements:

“John Whitelaw has agreed to invest in a child care centre which your client Scott Hookey is developing at Hope Island.

John is debt free, and Westpac want John to be the borrower and own the property.

John has told me however that their deal is that Scott and John will each be 50:50 in the property and the business Scott will own 50% of the land and John will own 50% of the business.

I understand the proposal is for separate unit trusts to own the property and the business, and that the units in each will be owned respectively by discretionary trusts, in the case of the property it will be John’s discretionary trust and in the case of the business it will be Scott’s discretionary trust.

Because of Westpac’s requirement, John and Scott will each have to give the other an operation to be allotted units in the other’s trust at an appropriate time in the future to change the ownership to 50:50.

We will also need to examine the stamp duty and capital gains tax implications.

These option documents could incur stamp duty if lodged for stamping.

We also need to consider the trigger for exercising the option.  It probably should be when Scott has the funds to contribute 50% of the capital.” ^[44]

53. [53]
    The first three paragraphs refer to Mr Whitelaw having “agreed to invest” in the child care centre upon the basis that Mr Whitelaw and Mr Hookey will participate as equal venturers in ownership of the land and the business, but those very general statements must be understood in the context of the following statements which convey uncertainty about the arrangement, that the arrangement amounts to a “proposal”, and that Westpac’s requirement will require agreement upon both the terms of an option for the allotment of units in each party’s trust and the “trigger” for the future exercise of the option.  The reported conversation is consistent with the conclusion that the parties had not concluded any agreement.
54. [54]
    The discussion about the trigger for exercising the options is of particular significance.  The trial judge found that the trigger foreshadowed by Mr Sayers did not eventuate; Mr Hookey did not provide 50 per cent of the capital for the purchase of the land and the construction of the childcare centre.  Furthermore, when Mr Watson (Mr Hookey’s accountant) sent an email on 8 July 2014 to Mr Sayers conveying a request by Mr Hookey’s solicitor, Mr Radcliff, for the issue of some (say 5 per cent) units in the KA Estates Unit Trust to assist him in obtaining an exemption from stamp duty at a later time when he sought to increase his equity up to just below 50 per cent, Mr Sayers responded:

“Having just spoken to Johno, a proper agreement is required prior to us issuing any units to Scott.  I understand the haste in completing a signed contract of land, however we really need a signed agreement as to how Johno and Scott are to proceed with this matter, such agreement being crafted in the next few days.”

55. [55]
    Mr Hookey’s omission to insist that there already was an agreement between him and Mr Whitelaw under which Mr Hookey beneficially owed 50 per cent of the units and he was entitled to the issue of the units makes it difficult to accept that the parties had in fact reached a consensus along the lines of Term 15 of the pleaded oral joint venture agreement (or the provision in “a” of the heads of agreement).  As the trial judge found, the evidence did not make it clear what would trigger the change in the proposed ownership to make it reflect the proposed 50:50 agreement.^[45]  The “trigger” does not seem less significant than the “key terms” the appellants argued had been agreed.
56. [56]
    The fifth aspect of the evidence submitted by the appellants to establish or record the “key terms” of the agreement is Mr Whitelaw’s email of 10 July 2014 to Mr Sayers.  The email is plainly consistent with the view that there was no concluded joint venture agreement by 1 July 2014.  Mr Whitelaw wrote to Mr Sayers:

“made good progress this morning on our agreement … as I’ve mentioned before the guts of it is quite simple i.e. we are both 50-50 on everything, the problems is always if one gets hit by a bus.  As a smaller side in terms of timings of unit transfers, change of shareholding percentages etc etc if and when required I am quite sure the vendor would be prepared to reprint the sales contract with new dates if we so require.

As you may recall all this fiddling about is to present to the banks something that makes sense to them.  This in turn creates a potential stamp duty problem which clearly we would like to avoid.

In terms of my appetite for the whole thing it really comes down to the fact that there is an opportunity to run and share in the risk/reward of business over and above a simple investment deal.  Bearing in mind what I have in the sales pipeline in London this whole deal sits comfortably with me.

I would appreciate it very much if you can have a look at our draft and comment as you see fit.”

57. [57]
    Most notably for present purposes, the first and the last sentences indicate that “our agreement” has not yet been concluded.  Otherwise, the email suggests that whilst the parties contemplated a 50:50 joint venture or partnership, what the appellants characterise as details which the parties proposed to negotiate about against the background of a binding contract were instead matters of importance to the parties.  The email does not amount to an admission by Mr Whitelaw that he and Mr Hookey had concluded any agreement by 10 July 2014, much less that they had concluded the pleaded joint venture agreement by 1 July 2014.
58. [58]
    The trial judge rejected the appellants’ pleaded case that Mr Hookey and Mr Whitelaw’s attendance upon Mr Radcliff (a solicitor) in about November 2014 to give instructions to him to draft a written agreement were instructions to record the express terms of the alleged joint venture agreement concluded on or about 30 June 2014 and that the draft “Co-operation Agreement” drafted by Mr Radcliff was a record of those terms.^[46]  The trial judge found that the draft Co-operation Agreement did not record the pleaded express terms of the alleged oral joint venture agreement and the fact that the parties were still negotiating the Co-operation Agreement in November 2014 supported a finding that they had not made any oral joint venture agreement by 1 July 2014 by which they intended to be legally bound.^[47]  The notice of appeal challenges the trial judge’s finding that the purpose of the consultation with Mr Radcliff was not to record what the parties had agreed prior to 1 July 2014.
59. [59]
    In Mr Radcliff’s evidence in chief, he said, when Mr Hookey and Mr Whitelaw attended at his office on 27 November 2014 for the purpose of recording an agreement between each other so if that anything happened to each of them it could be used later, Mr Hookey and Mr Whitelaw did not say anything about any existing arrangement or agreement they might have had.^[48]  They gave instructions to Mr Radcliff about various scenarios in which uplift or profit realised from the sale of the business or the land, after relevant contribution, costs and borrowings had been recovered, would be shared.
60. [60]
    After Mr Radcliff had obtained further information, an employee in the same office drafted the “Co-operation Agreement”, which was “a working draft of an agreement”.^[49]  In Mr Radcliff’s email of 25 February 2015 to Mr Whitelaw, Mr Radcliff suggested that he might visit the centre to work through “the draft agreement”.^[50]  Mr Radcliff agreed in cross-examination that there were gaps in the document for which further instructions or further agreement was required.  One example of such a gap is in clause 6.2, headed “Share of Profits”.  That clause deals with three scenarios: the sale of the site alone, the sale of the business alone, and the sale of both the site and the business.  In relation to the last scenario cl 6.2.3 states:

“In the event the parties elect to sell both the Site and the Business, [how are they sharing this?]”

61. [61]
    Mr Radcliff subsequently sought further instructions from Mr Hookey and Mr Whitelaw because he was “concerned to ensure that they reached an agreement, if that were possible, rather than leaving things in the state in which they presented themselves” to him in November 2014, but that did not eventuate.^[51]  His evidence provides no support for the appellants’ case that Mr Hookey and Mr Whitelaw had reached a consensus upon the terms of a joint venture agreement by 1 July 2014.
62. [62]
    There is no challenge to the trial judge’s conclusion that the draft Co-operation Agreement does not record the pleaded express terms of the oral joint venture agreement.^[52]  As the trial judge observed, the fundamental differences include that the draft Co-operation Agreement does not refer either to Mr Whitelaw and Mr Hookey equally owning KA Estates or Kids Academy or to a trigger for the transfer of 50 per cent of the interests in KA Estates or 50 per cent of the interest in Kids Academy to Mr Whitelaw or Mr Hookey.^[53]
63. [63]
    The sixth aspect of the evidence submitted by the appellants to establish or record the “key terms” is an email dated 16 May 2016 from Mr Whitelaw to Mr Balfour (who worked with Mr Sayers) in reply to an email of the same date from Mr Balfour.  In Mr Balfour’s email he referred to Mr Watson having prepared draft accounts and sought further information to finalise them.  After referring to a discussion with Mr Watson in which they decided to keep the rent figure low to ensure that Kids Academy and KA Estates remained at a loss position for the 2015 year, Mr Balfour set out his “understanding” of “how this whole venture is intended to work”.  He referred to five points:

“● Business Profit is split 50/50 between Scott and yourself

• Any capital gain on the sale of the business is split 50/50.
• Any capital gain on the sale of the property is split 50/50
• Rental profit in KA Estates – is this to be split 50/50 also?

Things to do:

• An Official lease agreement needs to be put into place between KA Estates Unit Trust and KA Hope Island Unit Trust.
• If not already done. A Capital works/depreciation report should be completed by a quantity surveyor to ensure the maximum amount of depreciation is claimed each year.”

64. [64]
    In Mr Whitelaw’s reply email, he responded:

“Re the business, your first three points are correct, re profits to be split in KA Estates not sure how this is to be addressed.  The first point is that my $7300.00 per week is totally separate issue as that is a return on capital invested.  If it assists the global picture by having profit in KA estates then I guess those profits can be split, the next problem may be how does that money get back to Scott without him being taxed again??  Will chat tomorrow”.

65. [65]
    As the trial judge considered, Mr Whitelaw did not confirm that he had an agreement with Mr Hookey upon the first three dot points of Mr Balfour’s email; rather, Mr Whitelaw commented upon Mr Balfour’s understanding that any venture was “intended to work” in the way described in the dot points.^[54]  In any case, the appellants’ argument did not explain how this email could be shown to relate to the pleaded joint venture agreement, or any joint venture agreement made by 1 July 2014.
66. [66]
    The last aspect of the evidence submitted by the appellants to establish or record the “key terms” of the alleged agreement is a diary note made by Ms Luff, the chief operating officer of Mr Hookey’s group of companies, of a meeting between her and another employee of the same group with Mr Whitelaw on 1 February 2018.  The appellants argue that, consistently with the diary note, an admission by Mr Whitelaw of a joint venture agreement was found in Ms Luff’s evidence that Mr Whitelaw stated:

“There is an agreement between Scott and myself that we are 50-50 in Kids Academy and KA Estates.  Scott is to receive a 50% uplift in the building, and I am to receive 50% ownership in Kids Academy, splitting profits.”

67. [67]
    According to Ms Luff, the immediately following statement made by Mr Whitelaw, was that, “The original deal was KA Estates own the land and buildings 100%, and there could be a management fee paid.” Ms Luff also gave evidence that after she expressed confusion about “why the interest payments Kids Academy is making to you are being recorded as rent”, there was a telephone conversation in which Mr Whitelaw’s accountant, Mr Balfour, stated, “Regardless of John and Scott’s handshake agreement, the interest payments are being accounted for as rent because that is what works out best for John.”^[55]  In fact the rent was payable by Kids Academy to KA Estates pursuant to the registered lease executed by the parties on 16 July 2014.  It was not any party’s case that the lease did not take effect according to its terms.  Whatever approach the parties might have taken in accounting for the rent in their tax returns or other accounts, the registered lease conclusively establishes the character of the relevant payments as rent.
68. [68]
    The trial judge did not err in finding that Ms Luff’s diary note and her evidence, and other general evidence that long after 1 July 2014 Mr Whitelaw referred to him and Mr Hookey being 50:50 partners or in a partnership with Mr Hookey,^[56] did not evidence the pleaded joint venture agreement (or, I would add, any agreement intended to be legally binding having been made by 1 July 2014).  The appellants rely upon that body of evidence in this appeal but, as the trial judge explained, it is non-specific and equivocal and it does not identify the terms and subject matter of any partnership; furthermore, that evidence must be understood in the context of the continuing negotiations of the terms of any agreement and the facts that the lease commenced and the childcare business opened on 2 February 2015, Mr Whitelaw’s entities had provided all of the capital for the purchase of the land and the construction of the child care centre, and Kids Academy had occupied the centre pursuant to the lease.^[57]
69. [69]
    The appellants rely upon conduct in which the parties engaged immediately after 1 July 2014 as an indication that they had formed a binding agreement:

2. “(a)
   KA Estates was incorporated on 1 July 2014 and the KA Estates Unit Trust was settled on the same date.
3. (b)
   Mr Whitelaw wrote to the vendor on 1 July 2014 advising of the entity that would purchase the land, Mr Whitelaw stating that “following the bank meet today we have pushed ahead with some clarity …
4. (c)
   Mr Hookey emailed his lawyers to prepare a lease as required by the bank.
5. (d)
   On 1 July 2014 Mr Whitelaw paid Mr Hookey $50,000 by way of partial reimbursement for expenses incurred in preliminary work carried out on the site.
6. (e)
   On 2 July 2014 Mr Watson (Mr Hookey’s accountant) spoke with Mr Sayers (Mr Whitelaw’s accountant).   Mr Watson’s evidence was that Mr Sayers told him that Mr Whitelaw had “agreed to invest in [the] child-care centre”. That evidence was not challenged in cross-examination.
7. (f)
   On 7 July 2014 Mr Hookey and Mr Whitelaw executed, and agreed to be bound by, the building contract which was styled “Scott Hookey and John Whitelaw trading as KA Estates Pty Ltd”.  No correction was sought by Mr Whitelaw.
8. (g)
   On or before 8 July 2014 Mr Whitelaw instructed Corey Radcliff, solicitor, to act for him on the purchase of the land.  Mr Radcliff had previously acted for Mr Hookey and thereafter acted for both.  Mr Radcliff then wrote to Mr Hookey’s accountant confirming that the unit trust would be proceeding as buyer.
9. (h)
   On 8 July 2014 Mr Hookey instructed a valuer to prepare an indicative valuation for the land.  A valuation was obtained on 18 July 2014 and was assigned to Westpac by Mr Hookey.  Mr Hookey paid for the valuation report.
10. (i)
    On 8 July 2014 the existing land purchase contract was rescinded and the second appellant entered into a new purchase contract (with Mr Hookey guaranteeing its obligations).”^[58]

70. [70]
    As to paragraph (b), the expression “we have pushed ahead with some clarity” is not inconsistent with there being no concluded agreement between the parties.  I have already explained why the evidence described in paragraph (e) does not point to the existence of a concluded agreement.  That and all of the other conduct upon which the appellants rely is consistent with the parties proceeding in the hope that they would conclude a joint venture agreement.
71. [71]
    The appellants also rely upon conduct in which the parties subsequently engaged:

2. “(a)
   Mr Whitelaw was involved in the childcare business. As to this:

1. (i)
   He had access to the bank account of Kids Academy, which he said he viewed almost daily.
2. (ii)
   He sought access to the business’s superannuation and tax bank accounts.
3. (iii)
   He claimed an entitlement to an equal share of the losses of the business in the 2015 financial year.
4. (iv)
   He was involved in the decision to install a coffee shop.
5. (v)
   He was involved in the grant of the licence to operate a swimming school.
6. (vi)
   He was involved in the decision about whether to build a squad pool on the land.
7. (vii)
   He received weekly reports in relation to the operation of the child-care business.
8. (viii)
   He attended the childcare centre almost every day during the first six months after it opened, and involved himself in operational matters.  In the course of these attendances, Mr Whitelaw also asked questions about the business, such as ‘where are we at with enrolments’, how is the set-up’, and ‘do you have everything you need’.  Mr Whitelaw also asked Mr Grassby questions about the business, including about enrolment of children and recruitment of staff.

2. (b)
   Mr Whitelaw was paid a 9% return on his investment.
3. (c)
   Mr Whitelaw drew $130,000 from the account of the second appellant up to 21 September 2017.
4. (d)
   The parties kept a ‘slogger’, a term which Mr Hookey deposes meant a tally of the payments which they each made and received in relation to the development.
5. (e)
   The second appellant made weekly payments of $6,000 from 24 April 2015 (later increased in early 2016 to $7,300 per week) to Mr Whitelaw’s personal bank account (noting that under the written lease the second appellant was not required to start paying rent until 2 August 2015).  Mr Whitelaw gave evidence that this was totally separate to the payment of rent.
6. (f)
   Kids Academy paid the interest on KA Estates’ bank loan from 1 February 2016 until 12 September 2018 in the amount of $878,752.99.”^[59]

72. [72]
    In relation to paragraphs (b) and (e), the trial judge correctly concluded^[60] that the facts that Mr Hookey and Mr Whitelaw agreed Mr Whitelaw was to receive a nine per cent return on capital, and Mr Whitelaw considered the weekly payments to be nine per cent interest on his capital rather than rental payment, did not support a finding that, absent agreement upon essential terms, the parties had concluded an agreement by 1 July 2014.  Many submissions were addressed to the Court about the significance of entries in the “slogger” mentioned in paragraph (d), but it is sufficient to observe that the fact that the parties maintained a record of the payments made and received in relation to the development could not support the appellants’ contention that they had concluded the pleaded joint venture agreement by 1 July 2014.  That and all of the other items of conduct upon which the appellants rely are consistent with the parties not having finalised any joint venture agreement by 1 July 2014.
73. [73]
    That conclusion is supported also by conduct of Mr Hookey after 1 July 2014 to which the trial judge referred:^[61]

2. “(a)
   Mr Hookey participating in discussions with Mr Whitelaw and Mr Radcliff in November 2014 when terms inconsistent with the pleaded terms of the oral agreement were discussed without his protest;
3. (b)
   Mr Hookey causing the lease to be registered on 12 February 2016;
4. (c)
   Mr Hookey causing the lease to be mortgaged on 12 February 2016;
5. (d)
   Mr Hookey accepting the sum of $1 million from Mr Whitelaw in May 2016 in circumstances where neither the improved land or the business had been sold;
6. (e)
   in its 2016 tax return, Kids Academy returned a taxable income of $4,782 and, contrary to the alleged agreement, those profits were distributed entirely to Mr Hookey’s trust, the Hookey Enterprises Trust and were not shared 50/50;
7. (f)
   Mr Hookey’s freewheeling use of Kids Academy’s Westpac accounts.  On 21 September 2017, for example, Mr Hookey was sent a general ledger by Ms Webb with two attachments, one of which was “Scott’s drawings.xlsx”.  The withdrawals from Kids Academy’s bank accounts totalled $497,699.16 and deposits of $449,451.88, leaving a shortfall of $48,247.28;
8. (g)
   Mr Hookey used the Kids Academy’s superannuation and tax bank account for payments of personal expenses; and
9. (h)
   Mr Hookey’s freewheeling use of Kids Academy’s bank accounts is to be contrasted with the refusal to give Mr Whitelaw access to those same bank accounts.”

74. [74]
    The mortgage referred to in paragraph (c) is of particular significance.  In early 2016 Mr Hookey caused Kids Academy to mortgage the lease to it as security for a Westpac Finance facility in a total amount exceeding $30 million, a substantial part of which was to be used to construct a new centre in New South Wales in which Mr Whitelaw had no interest.  Mr Hookey also caused Kids Academy to execute a guarantee and indemnity in respect of the facility in favour of Westpac.  Mr Hookey obtained Mr Whitelaw’s consent to the mortgage, as was no doubt required because Mr Whitelaw was the controller of the lessor, KA Estates.  Significantly, Mr Hookey did not suggest that he or Mr Whitelaw adverted to the manifest inconsistency between Mr Hookey’s conduct and any form of venture in which Mr Whitelaw beneficially owned half of the units in Kids Academy, was entitled to share in its profits, and was obliged to share in its losses.  This transaction is not readily reconcilable with the pleaded joint venture agreement or clause (f) of the “key terms” of the arrangement for which the appellants now contend.
75. [75]
    The appellants argue that Mr Whitelaw’s conduct in May 2016 of paying $1 million to Mr Hookey as reimbursement for preliminary expenses which had been estimated at about $500,000 in June 2014 unequivocally indicated that the parties were bound to a joint venture agreement.  Consistently with the appellants’ reference to “a” joint venture agreement,^[62] it could not be concluded that this payment evidenced the pleaded (on any) joint venture agreement alleged to have been concluded nearly two years earlier.  Upon the accepted evidence of Mr Whitelaw, the payment was referrable to a different arrangement for “a ‘square up’ that took care of all [Mr Hookey’s] preliminary costs and other expenses and ensured [Mr Whitelaw] received a return of 9% on [Mr Whitelaw’s] capital.”^[63]
76. [76]
    The appellants did not plead a case that the alleged joint venture agreement was to be inferred from subsequent conduct of the parties.  As the trial judge pointed out in observations the appellants do not challenge, the primary analysis of whether a contract was formed was to be undertaken by reference to Mr Hookey and Mr Whitelaw’s conversations before 1 July 2014, and:

“… care must be taken to ensure that the objective assessment of the relevant conduct in all the circumstances unequivocally points to the existence of the contract in the terms alleged by the party seeking to prove the contract.  Conduct that is merely consistent with the terms of the alleged agreement is not enough.”^[64]

77. [77]
    Some of the conduct after 1 July 2014 is consistent with the existence before that date of the pleaded joint venture agreement and some of that conduct is inconsistent with it; none of the conduct after 1 July 2014 upon which the appellants rely unequivocally points to the existence of the pleaded joint venture agreement or any joint venture agreement having been made by 1 July 2014.
78. [78]
    The appellants challenge the trial judge’s findings that Mr Hookey appreciated that Mr Whitelaw required any joint venture agreement to be reduced to writing^[65] and that it was the intention of the parties not to make a concluded bargain unless and until they had executed a formal written agreement.^[66]  The appellants argue that the only evidence that Mr Hookey was made aware by Mr Whitelaw that he required any agreement to be in writing before he would be bound is Mr Hookey’s evidence in cross-examination in which he answered “Yes” to the question “Did he say to you that he wanted an agreement in writing?”  The appellants rely upon the fact that Mr Hookey gave this answer in the course of the discussion about the origin of the heads of agreement.
79. [79]
    That context does not assist the appellants’ argument, given the trial judge’s finding that Mr Hookey drafted the heads of agreement on 1 July 2014.  The evidence discussed in [40] - [42] of these reasons supports the conclusion that the parties did not intend to conclude a legally binding contract unless and until they had executed a formal written agreement.  The trial judge’s finding is supported also by Mr Sayers’ evidence that at the meeting foreshadowed in the 7 April 2014 email he told Mr Whitelaw and Mr Hookey that a joint venture agreement was needed “to deal with the deal from conception to death.”  Furthermore, Mr Hookey’s own evidence was that he prepared the heads of agreement “because we were throwing so many different ideas around”^[67] and in response to Mr Whitelaw’s statement that “I think we better start putting a bit of this on paper so that we can try to get it fixed up”.^[68]
80. [80]
    The nature of the proposed agreement also supplies strong support for the conclusion that the parties intended to be bound only by a written agreement, particularly having regard to the evidence that the parties anticipated that the financier’s requirements would oblige them to enter into a lease, which inevitably would cut across their previous negotiations.  It is most improbable that reasonable business persons in the positions of these parties would have intended to be legally bound by an oral joint venture agreement of the kind pleaded by the appellants, which would create a legal and financial relationship that would substantially qualify the relationship created by the legally binding registered lease.  The improbability of such an oral agreement is increased further by the circumstance that each of the parties was obtaining professional advice and, at least in the case of Mr Whitelaw, that professional advice strongly urged entry into a comprehensive written joint venture contract.
81. [81]
    I would hold that each of the appellants’ challenges to the trial judge’s findings upon the first primary issue fails.  In particular, I would affirm the trial judge’s conclusions that:

    1. (a)
       Pleaded express terms of the alleged joint venture agreement, Terms 14, 15, 16, 17 and 19A, were not agreed or even discussed.
    2. (b)
       By 1 July 2014 there were too many uncertainties for the parties to have been in a position to reach a consensus upon the terms of any proposed joint venture, given that the application for finance had not been approved, it was contemplated at the end of June that Westpac would make a decision upon the finance application soon thereafter, at that time it was not certain whether (as occurred) Westpac would lend only to Mr Whitelaw, and it was not certain until early July 2014 that Westpac required a lease to be in place, whereas the draft heads of agreement contemplated that there would be no formal lease.
    3. (c)
       There were significant inconsistencies between the alleged express terms said to have been agreed between Mr Hookey and Mr Whitelaw, the draft heads of agreement, and the draft Cooperation Agreement.
    4. (d)
       The evidence did not reveal the “trigger” for any change to the then existing ownership arrangements as would be required to reflect a 50:50 joint venture such as had been the subject of the negotiations before 1 July 2014.
    5. (e)
       Upon the accepted evidence, the parties intended not to make any concluded or legally binding bargain unless and until they executed a formal written agreement, and they had not executed any such agreement by 1 July 2014.

The second primary issue: are the appellants estopped from acting other than in accordance with the terms of the alleged joint venture agreement, and are they otherwise estopped from enforcing compliance of a registered lease granted by KA Estates to Kids Academy except with the consent of Mr Hookey?

82. [82]
    The relief claimed by the appellants in the fourth further amended statement of claim includes an order that receivers be appointed to the joint venture.  This and other claims for relief were submitted to be available upon the basis of an estoppel by convention.  The trial judge concluded that the claims for estoppel by convention (and for an equitable estoppel) must fail because the parties’ relationship was governed by a registered lease and, upon the findings, no oral joint venture agreement was formed and Term 19A was not discussed.^[69]
83. [83]
    The appellants contend that the trial judge erred in failing to find “that the parties had conducted their relationship on the common assumption that the terms of their legal relationship were as alleged by the Appellants” and “that the First and Second Respondents would not deny the existence of the oral joint venture agreement”, and in failing to find that “by their conduct the First and Second Respondents had induced the First and Second Appellants to assume that the parties were bound to observe and perform the obligations on their respective parts as alleged by the Appellants and that the First and Second Respondents are thereby estopped from denying the existence of the oral joint venture agreement.”^[70]  Those contentions reflect part of paragraph 48 of the fourth amended statement of claim.  Paragraph 48 pleads:

“At all material times, the conventional basis upon which Hookey, Kids Academy, Whitelaw and Estates dealt with each other induced the common assumption ([Common Assumption]) that –

1. (a)
   the terms of the legal relationship between Hookey, Kids Academy, Whitelaw and Estates were the terms set out in in paragraphs 21 and 24 as varied, 25(a) and (b), 26, 27 and 35 (Joint Venture Terms), including without limitation that Whitelaw and Hookey were the equal owners of and would have equal control of Estates, and
2. (b)
   Whitelaw and Estates would not do anything on their respective parts to enforce compliance by Kids Academy with the provisions of the Registered Lease without the consent of Hookey.”

84. [84]
    In this appeal the appellants abandoned reliance upon paragraph (b), which they acknowledge is inconsistent with the registered lease.
85. [85]
    Paragraph 21 of the pleading sets out the numerous alleged express terms of the pleaded joint venture agreement.  Paragraphs 24, 25, 26 and 27 allege implied terms, the implication of which necessarily depends upon the existence of alleged express terms.  Paragraph 34 pleads the alleged variation of the joint venture agreement in about May 2016 under which Whitelaw would pay $1 million to Mr Hookey, Mr Hookey would release Kids Academy and KA Estates from their obligations to repay their loans from Mr Hookey, and Kids Academy would pay interest on the $1 million paid by Mr Whitelaw to Mr Hookey at 9 per cent per annum.
86. [86]
    Paragraphs 49 to 54 allege that from about 30 June 2014 until 11 May 2018, Mr Hookey, Kids Academy, Mr Whitelaw and KA Estates adopted the Common Assumption and conducted the relationship between each other on the basis of the Common Assumption, knowing and intending that each other party acted and would act on that basis.  Paragraphs 55 and 56 plead that departure from the Common Assumption by Mr Whitelaw and KA Estates will occasion detriment to Kids Academy and Mr Hookey.  Particulars of those allegations refer to paragraphs 44 – 47, each of which particularises loss and damage that would flow from breach of the pleaded express terms, including in particular Terms 14, 15 and 19A.
87. [87]
    The estoppel claim could not succeed for the following reasons:

    1. (a)
       The appellants did not secure findings of any of the facts alleged in paragraphs 49 – 54 of their fourth further amended statement of claim.
    2. (b)
       The appeal must proceed upon the basis of the trial judge’s finding that Mr Hookey and Mr Whitelaw did not discuss critical terms of the alleged joint venture agreement, including Terms 14, 15 and 19A.
    3. (c)
       In light of the trial judge’s findings, Mr Hookey’s evidence cannot be invoked in support of the finding that he adopted the alleged Common Assumption and the accepted evidence of Mr Whitelaw is not consistent with him having adopted that alleged assumption.
    4. (d)
       The conduct upon which the appellants rely as support for the alleged Common Assumption that the terms of the parties’ legal relationship were those pleaded by the appellants was equivocal and did not support such an assumption.

Other matters

88. [88]
    The appellants and the respondents sought to adduce evidence in the appeal of events that occurred after judgment in the Trial Division, but only if the appellants otherwise succeeded in the appeal to some extent.  Because I would hold that the appeal wholly fails, I would refuse the applications for leave to adduce additional evidence.

Proposed orders

89. [89]
    The appeal should be dismissed.  I would give the parties leave to make written submissions about costs and any appropriate consequential orders, such submissions to be exchanged and lodged with the Court within 14 days of publication of these reasons and not to exceed five pages in length.
90. [90]
    BODDICE J:  I agree with Fraser JA.