Burnitt v Williams[2013] QDC 157

DISTRICT COURT OF QUEENSLAND

1. [1]
   Mr Burnitt and Mr Williams were casual golf partners in 2009 when they commenced a brief and unhappy commercial relationship in a hospitality business at the Gold Coast trading as Billy’s Beach House.

2. [2]
   Over a period of some months in late 2009, the men reached two oral agreements, pursuant to which Mr Burnitt made contributions in money ($300,000) and in kind (electrical work invoiced by his company at more than $300,000) to their commercial venture. When their relationship soured in February 2010, Mr Burnitt says that Mr Williams agreed to repay him his investment.

3. [3]
   There are few disputes about the terms of the two oral agreements. The approximate date of the second agreement is unclear; the purchase price for the second oral agreement is not agreed and Mr Williams did not admit the value of the in kind contribution. Otherwise, the parties agree they reached two oral agreements, relating to distinct parts of the business.

4. [4]
   Mr Williams denies any personal liability to Mr Burnitt under the agreements. He asserts he entered into both as agent for Jalco Pty Ltd, a company in which he was the sole director and shareholder. He denies agreeing to repay Mr Burnitt’s investment. He says that Mr Burnitt must look to Jalco, not to him, for relief.

5. [5]
   The issues are:

1. Whether Mr Williams is personally liable under the agreements;
2. Whether Mr Williams is liable to repay Mr Burnitt’s investment.

1. (1)
   Is Mr Williams personally liable under the agreements?

1. (a)
   The business and corporate structure

6. [6]
   Before turning to the discussions between the men, it is necessary to identify the business interests involved and the ownership structure.

7. [7]
   The business comprised activities which traded under the name of Billy’s Beach House at Trickett Street, Surfers Paradise (a restaurant, bar) and three bottle shops, one attached to Billy’s Beach House, one at the Isle of Capri Shopping Centre and one at the Pit Stop Food Centre on the Gold Coast Highway.^[1]

8. [8]
   There are two relevant companies and trusts. The business was operated by Beach House Taverns Pty Ltd, which held the liquor licence for the main premises and the three bottle shops, as trustee for the BT Unit Trust.^[2] The 1,000 units in the BT Unit Trust were held by Jalco Pty Ltd as trustee for the Rex Williams Family Trust. Mr Williams was the sole Director and shareholder of both Jalco and Beach House Taverns.

2. (b)
   The agreements

9. [9]
   Mr Williams’ commercial dealings with Mr Burnitt commenced in July 2009. Mr Williams asked Mr Burnitt to advise him on some renovations in progress at Billy’s Beach House and this led to Mr Burnitt’s company, Logan City Electrical Pty Ltd, undertaking work to complete them.

10. [10]
    Mr Williams said he bought out his former business partner, William Hammond, known as Billy James, in June 2009. He bought Billy James’ shareholding in Beach House Taverns and Jalco purchased the units held by Billy James in the BT Unit Trust.^[3]

11. [11]
    Mr Burnitt and Mr Williams both say their first oral agreement was reached in about September 2009. Mr Burnitt said “Rex asked me if I would be interested in buying part of the business,..off himself.”^[4] Mr Williams’ evidence on the point was “in our discussions I’d just informed him that Billy James was no longer involved in the business and that I needed a partner or it would be suitable for me to have a partner in place of Billy James.”^[5] It is common ground that the first agreement related only to the onsite business trading as Billy’s Beach House and excluded the bottle shops. Mr Williams said two of the three bottle shops were subject to a separate agreement for sale (which later fell through).^[6]

12. [12]
    Pursuant to their first agreement, Mr Burnitt paid $50,000 on 12 November 2009. He said he made the payment to Beach House Taverns at the direction of Mr Williams, although Mr Williams denied he gave that direction.^[7] No interest in the onsite business was ever transferred to Mr Burnitt.

13. [13]
    The second agreement related to the balance of the business, including the bottle shops. The parties do not agree in their pleadings when the second oral agreement was reached, although the evidence of the two men is, once again, not in substantial conflict. The approximate date is important for two reasons. Firstly it will assist in resolving the conflict on the evidence about the purchase price settled upon for the second oral agreement. Secondly it is relevant to determining the state of Mr Burnitt’s knowledge of the corporate and trust structure when he entered into the second agreement.

14. [14]
    Mr Williams said the second agreement was reached in early November 2009.^[8]

15. [15]
    Mr Burnitt pleaded the agreement was reached in December 2009. His counsel, Mr Morris QC, asked him whether he remembered a conversation with Mr Williams in late November that year. Mr Burnitt said that was when he was asked whether he would be interested in buying half the other business which included “the bottle shop side of things and stock and everything like that.” Two days later he told Mr Williams he wanted to accept the offer.^[9] That would put the agreement in late November or early December.

16. [16]
    However, I am satisfied the oral agreement was reached in early to mid-November, rather than late November or in December. That accords with Mr Williams’ evidence and with the evidence given by Mr Burnitt about two documents which assists in fixing the timing of their negotations.

17. [17]
    The first document is a letter from Mr Williams’ solicitors, Short Punch and Greatorix, to Jalco c/- Mr Williams dated 29 October 2009.^[10] The exhibit bears facsimile transmission notations that indicate it was faxed to Mr Burnitt’s accountant on 4 November 2009. Mr Burnitt thought he would have seen it a week or so after his accountant did.^[11] He agreed that he had it before he reached the second agreement.^[12]

18. [18]
    The second is an email from Matthew Brook, a solicitor with Short Punch & Greatorix, to Mr Burnitt dated 20 November 2009, enclosing a draft Share Sale Agreement and a draft Shareholders and Unitholders Agreement.^[13] Mr Burnitt said he thought they had reached their oral agreement before he received the draft documents.^[14]

19. [19]
    That would place their negotiations for the second oral agreement between 4 November at the earliest and 20 November at the latest. I accept it is most likely that the agreement was reached around the time Mr Burnitt paid $50,000 due under the first oral agreement, on 12 November 2009.

20. [20]
    That deals with the approximate date of the oral agreement. As to the purchase price under that agreement, Mr Burnitt said a price of $500,000 was first discussed, but he was later told by Mr Williams’ accountant, Mr Wilson, that Mr Williams wanted a further $50,000, taking the price to $550,000. Mr Wilson did not recall that conversation.^[15]

21. [21]
    Although Mr Williams did not accept this represented the value of the electrical work performed by Logan City Electrical, that company issued invoices to Billy’s Beach House to a total of $333,469.65.^[16] There is no other evidence before the court to establish the value of the work and I accept the invoices are an accurate reflection of the value of the work.

22. [22]
    Mr Burnitt paid $250,000 on 21 December 2009. He provided the draft documents prepared by short Punch & Greatorix to Russell Lloyd, his solicitor, for advice on about 12 January 2010.^[17] A handwritten file note on Mr Lloyd’s file bears the following notation:

(g) Contra 250,000 CR

250,000

500,000

23. [23]
    The only evidence available about when Mr Lloyd was consulted suggests that this note was made after 12 January 2010, when the documents were provided to him.

24. [24]
    Given that evidence, and Mr Wilson’s evidence that he did not recall saying anything to Mr Burnitt about an increase in the price by $50,000, I find that the purchase price agreed for the second oral agreement was $500,000, not $550,000, and that the value assigned to the electrical work under the contra agreement was $250,000.

25. [25]
    Mr Burnitt said he signed the agreements, amended to reflect the advice of his solicitor. Mr Burnitt said he assumed the signed documents would have been provided to Mr Williams’ lawyers, but there is no evidence that they were sent to them.

26. [26]
    Mr Williams conceded that no interest in the business, on site or off site was ever transferred to Mr Burnitt.^[18] In February or March 2010, Mr Burnitt says that Mr Williams agreed to repay him his investment in the business.

3. (c)
   The agency issue

27. [27]
    In this case, the critical issue is the capacity in which Mr Williams reached agreements with Mr Burnitt. Mr Williams’ defence is that he bears no personal liability under the agreements, having contracted with Mr Burnitt only as an agent for Jalco. That is disputed.

28. [28]
    Because the agreements are oral, their terms must be ascertained from the common intention arising from the parties’ words and conduct. This is not merely a question of the beliefs, understandings or intentions of the parties but what each party by words and conduct would have led a reasonable person in the position of the other party to believe.^[19]

29. [29]
    The oral negotiations were expressed in the first person^[20] and there is no evidence that Mr Burnitt knew of Jalco or its role in the ownership structure until after the first agreement was reached, when Mr Burnitt received a copy of the letter from Mr Williams’ solicitors.^[21]

30. [30]
    Counsel for Mr Burnitt argued this case could be simply disposed of as being an example of Mr Williams acting as an agent for an undisclosed principal, Jalco. If that is the case, Mr Burnitt has the option to sue either Jalco or Mr Williams on the contract.^[22]

31. [31]
    I am not persuaded this is a case of an undisclosed principal, in the sense of the agency itself being undisclosed. Rather, it presents as a case of unidentified principal, at least in relation to the first agreement.

32. [32]
    Before the first agreement was reached, there is no evidence that Mr Burnitt had specific knowledge of the corporate and trust structure that sat behind the business. After the first agreement was reached, Mr Burnitt said he assumed the business was run by a company^[23] and that he was a director of it^[24].

33. [33]
    He acted consistently with that belief when he signed an application to transfer the liquor licence,^[25] on 25 October 2009. He signed in the section which provided for a director or secretary to sign if the proposed licensee was a company. On 2 November 2009, he signed an ATM Site Location and Placement Agreement Application Form as Director.^[26] He also paid the purchase price for the first agreement to Beach House Taverns.^[27]

34. [34]
    Mr Burnitt is an experienced businessman and conducts his own businesses through a number of corporations. He has a number of trusts which own property. He runs a number of businesses through trustee companies.^[28] Given Mr Burnitt’s experience in business and the way in which he organised his own business affairs, it is reasonable to draw the inference that he assumed that Mr Williams would speak on behalf of any corporations involved in the business, to the extent that a corporation was required to do anything to give effect to their agreements.

35. [35]
    Mr Burnitt said he thought he would be buying into a company called Billy’s Beach House.^[29] The belief that he was buying into a company is entirely consistent with a belief that he was entering into an agreement with the owner of the shares in any relevant company.^[30] It does not indicate a belief that he was buying an interest from a company.

36. [36]
    By the time they negotiated the second oral agreement, Mr Burnitt had a greater understanding of the corporate and trust structure. He conceded he had the letter from Short Punch and Greatorix to Jalco before the second agreement was reached. That letter disclosed Jalco’s role in the business. I infer that he also understood that Mr Williams spoke for Jalco.

37. [37]
    However, these findings do not, without more, exclude Mr Williams assuming personal liability under the agreements.

38. [38]
    The mere fact that a person acts as agent and is known to do so does not necessarily negate his involvement in the transaction.^[31]

“A person is liable for his engagements…even though he acts for another, unless he can show that by the law of agency he is to be held to have expressly or impliedly negatived his personal liability.” ^[32]

39. [39]
    An agent can contract on behalf of his principal in one of three ways, not all of which will result in the agent negativing any personal liability:

“(a) By creating privity of contract between the third party and his principal without himself becoming a party to the contract. The principal need not be named but the contract must show clearly that the agent was acting as such. Familiar examples are contracts made by X as agents and signed by X, the signature being claused ‘as agents only’. The consequence of such an arrangement is that the third party can only sue, and be sued by, the principal.

(b) By creating privity of contract between the third party and his principal, whilst also himself becoming a party to the contract. The consequence of this arrangement is that the third party has an option whether to sue the agent or the principal, although this is of little practical value if he does not know of the principal’s existence…

(c) By creating privity of contract between himself and the third party, but no such privity between the third party and his principal. In other words, in relation to the third party he is a principal, but in relation to his principal he is an agent. The consequence of this arrangement is that the only person who can sue the third party or be sued by him is the agent.” ^[33]

40. [40]
    For the following reasons, I find that this is a case of the second kind, in which Mr Williams assumed liability on his own account as well as acting as agent for Jalco in the negotiations.^[34]

41. [41]
    Mr Burnitt gave evidence that he considered Mr Williams had the ability to and was undertaking to give effect to their agreements, whether by personal conveyance or through a corporate entity which he controlled.^[35]

42. [42]
    Until after the close of Mr Burnitt’s case, Mr Williams’ defence was that he acted as agent for Beach House Taverns. As this entity held the business on behalf of a unit trust, the units in which were held by Jalco as trustee for Mr William’s family trust, he could not have been acting as agent for BHT. The change of position about which entity he was agent for, so late in the day, does not sit comfortably with Mr Williams’ insistence that he was Jalco’s agent.

43. [43]
    There are other matters, addressed later in these reasons, on which counsel for Mr Burnitt relied to undermine Mr Williams’ credit as a witness. Although I prefer the evidence of Mr Burnitt, where it is in direct conflict with that given by Mr Williams, there was little difference in their evidence about their negotiations. My decision on the question of agency has not depended to any large degree on my assessment of Mr Williams’ credit as a witness.

44. [44]
    The nature of the two oral agreements works against the conclusion that Mr Williams would have no personal liability under them. It was not possible for Jalco to perform agreements to convey discrete portions of the business. Jalco did not own the business; it owned the units in the BT Unit Trust. There was no way that Jalco could have made over a 50% interest in the on site part of the business and then separately conveyed a 50% interest in the balance of the business. It could only ever convey a 50% interest in the trust itself, by selling half the units.

45. [45]
    Mr Griffin QC, for Mr Williams, argued the share in Beach House Taverns had no value and that its role as the trustee for the BT Unit Trust, and the operator of the business, could be terminated by Jalco as the owner of all the units in the trust.

46. [46]
    However, this was not a transaction solely to transfer a share in the beneficial ownership of the business. The men agree that Mr Burnitt was to, and did, assume a role as a business partner (using that term loosely). Mr Burnitt acted accordingly in signing the liquor licence and ATM forms as director. Mr Williams introduced Mr Burnitt to staff of the business as his partner and acquiesced in his active involvement in the operation of the business until their falling out in February 2010.^[36]

47. [47]
    To convey an element of control at an operational level, it is to be expected that Mr Burnitt would be a shareholder and director of the operating company, Beach House Taverns. As long as Beach House Taverns was the trustee and the operator of the business, only Mr Williams, as the sole shareholder and director, could give effect to that aspect of the transaction.

48. [48]
    Mr Williams did not disclaim personal liability under the agreements, either expressly or by conduct that Mr Burnitt could reasonably be expected to understand as such. It was consistent with the way in which the parties negotiated and presented themselves as partners that Mr Williams, as the controlling mind of all relevant entities, was contracting personally.^[37]

49. [49]
    Prior to the first agreement, he did not inform Mr Burnitt about the existence of or the extent of the corporate structure, and, specifically, made no mention of Jalco.^[38] At no time did Mr Williams tell Mr Burnitt that he was acting only as an agent for Jalco and that he would bear no personal liability under their agreements.^[39]

50. [50]
    Further, Jalco received none of the funds. It was banked to the account of Beach House Taverns and treated as a loan in its book of accounts.

51. [51]
    Although the parties did not execute written contracts, they did take steps to document their transactions after the two oral agreements had been reached. Those documents are a draft Share Sale Agreement and a draft Shareholders and Unitholders Agreement.

52. [52]
    In his submissions, counsel for Mr Williams intimated there was only one agreement that matured over time. This is not the way the defence was pleaded or conducted at trial. Mr Williams accepted there were two separate agreements, each dealing with distinct parts of the business. Had the parties executed the written agreements, their oral agreements may well have merged in the written contract. However, that did not occur.

53. [53]
    Neither party argued the documents constitute their agreements. However, they are relevant in establishing the course of conduct of the parties after their agreements were reached. Parties can be expected to act consistently with their bargains and I have had regard to the terms of the draft documents for that purpose.^[40]

54. [54]
    Mr Williams’ solicitors structured the documents in the way that they advised would most simply give effect to the parties’ agreements. They were created on Mr Williams’ directions, shortly after he says they reached their second oral agreement.

55. [55]
    There are a number of features of the documents which are consistent with Mr Burnitt’s understanding that he could look to Mr Williams for performance of their agreements. Firstly, Mr Williams is named as a party to both documents. Secondly, his relationship with Jalco is acknowledged, and is not described in terms of agency.^[41] Thirdly, they impose joint and several liability on Mr Williams and Jalco for their discrete obligations under the documents.^[42]

56. [56]
    Those features are inconsistent with Mr Williams assuming no personal liability. Indeed, Mr Williams conceded he had to be a party to the agreements, at least to the extent of transferring a share in Beach House Taverns.^[43]

57. [57]
    I am satisfied Mr Williams assumed personal liability to Mr Burnitt when he entered into the two oral agreements with him. To hold otherwise is against the weight of the evidence given by the parties about their negotiations and on an objective consideration of their conduct after the agreements were entered into. It is also inconsistent with the steps that would have been required in order to give effect to them.

2. Is Mr Williams liable to repay Mr Burnitt’s investment?

58. [58]
    A short time after Mr Burnitt paid $250,000 under the second oral agreement, he and Mr Williams discussed Mr Burnitt’s exit from the business. The details of their discussions and their legal effect are in dispute.

59. [59]
    Before addressing the parties’ arguments, it is appropriate to say something about their credit as witnesses. The resolution of disputes about the termination of their business relationship relies more heavily on their credibility, because there is little objective evidence to which I can turn.

a.) Credit considerations

60. [60]
    Lengthy written submissions were made to me by both counsel about the credibility of the parties. Those submissions are on the court file and I do not propose to traverse them in detail in these already lengthy reasons. Suffice it to say that I accept the submissions by counsel for Mr Burnitt that Mr Williams’ credit as a witness is challenged by the following matters.

61. [61]
    His case shifted considerably over time and during the trial about which entity he was representing during their negotiation and if and when he informed Mr Burnitt of this. The recasting of the defence was significant. It set up a quite different case as to why Mr Williams was not liable. The final formulation of his agency argument was not made clear until after Mr Burnitt’s case had closed and Mr Burnitt had to be recalled so that it could be put to him.

62. [62]
    Mr Williams blamed the earlier formulations of his case on his lawyers. Although a lay person might not be expected to understand legal propositions, this related to the business structure behind which he stood. Mr Williams exhibited a tendency to blame others. In particular, when it was suggested to him that other documents were at odds with the final terms of his defence. For example when challenged about statements he made in an affidavit filed earlier in the proceedings, he blamed his solicitors. Other examples are identified in written submissions.

63. [63]
    He was also directly contradicted by his own witnesses on some important matters, such as whose idea it was to assign a nominal value to the proposed transfer of the units in the unit trust and to treat the cash payments made by Mr Burnitt towards the purchase price under the oral agreements as loans.

64. [64]
    I will not descend into the detail of the assertions made by counsel for Mr Burnitt about Mr Williams. However, evidence that does not reflect well on his character was led about Mr Williams’ conduct in unrelated court proceedings and his involvement in transferring the assets of the business when Beach House Taverns was under administration. The latter is another example of Mr Williams assigning responsibility to others for a transaction which did not cast him in a good light.

65. [65]
    On the other hand, I accept there was no substantial challenge to Mr Burnitt’s credit as a witness. There were differences in detail between his pleading and his evidence which pale in comparison to the recasting of Mr Williams’ defence. He was consistent in his case that he dealt with Mr Williams as a person, although he conceded an increasing understanding over time of the corporations and trusts through which Mr Williams operated the business.

b.) Did the parties agree to terminate the oral agreements in March 2010?

66. [66]
    Mr Burnitt said an agreement was reached in early March 2010 that he would no longer participate in the management of the business and Mr Williams would repay him his investment by the end of May.^[44] He said Mr Williams told him he wanted him to withdraw from the business because he had found a new partner.^[45]

67. [67]
    Mr Williams agreed that he did not consult Mr Burnitt on any issues relating to the business after the first week of March 2010.^[46]

68. [68]
    By that time, Mr Burnitt had fulfilled his obligations under the oral agreements from the year before. Neither Mr Williams, nor any company associated with him, had transferred any interest in the business to Mr Burnitt.^[47]
69. [69]
    Mr Williams’ case is that there were general discussions about Mr Burnitt leaving the business but no agreement of any kind was struck. He agreed that Mr Burnitt played no further role in the business after the first week of March 2010,^[48] but said their meeting was in April 2010 when he asked Mr Burnitt to contribute a further $60,000. That figure represented half of an investment of $120,000 which Mr Williams said was necessary to support the business.^[49] Mr Burnitt denied any conversation about a further contribution to the business.^[50]

70. [70]
    Although Mr Williams said he met with Mr Burnitt in April, his counsel put to Mr Burnitt that the discussions about Mr Burnitt exiting the business started in March 2010.

71. [71]
    There was also evidence the men had a falling out over Mr Williams’ decision to sack a manager appointed by Mr Burnitt and replace him with a person Mr Burnitt considered to be inappropriate for the position. Mr Williams agreed this was the start of the rift between the two of them.

72. [72]
    I have already addressed the credit of the two men as witnesses. Where the evidence about the conversations between the two men in 2010 differs, I prefer the evidence given by Mr Burnitt. I am satisfied on the balance of probabilities that the meeting took place in March 2010 and that the conversation accorded, in broad terms, with Mr Burnitt’s account of it.

73. [73]
    Further, Mr Williams’ account is improbable. Mr Burnitt had made a substantial investment in the business. He paid $50,000 on 11 November 2009 and a further $250,000 on 21 December 2009. Services provided by his company, invoiced to Billy’s Beach House to a total value of over $300,000, had been written off as a contribution to the purchase price. Until their falling out, Mr Burnitt played a direct and active role in its management. He ceased to do so after their discussion. It is improbable that he would withdraw immediately unless an agreement had been reached about his exit from the business.

74. [74]
    The timing of their discussion is also relevant to Mr Williams’ explanation. Mr Williams said he requested $60,000 from Mr Burnitt in April 2010. This is some 6 to 8 weeks after Mr Williams agreed that he ceased consulting Mr Burnitt on matters relating to the business. Even were I to accept Mr Williams’ evidence about a conversation in April 2010, it does not explain Mr Burnitt’s withdrawal from the business in March 2010 or Mr Williams’ failure to consult Mr Burnitt on any further aspect of the business after that time.

75. [75]
    The conduct of both parties sits comfortably with Mr Burnitt’s evidence, both as to the timing of the meeting and the terms of their conversation. I am satisfied that the men did reach an agreement to terminate the oral agreements in March 2010.

c.) Was the March 2010 agreement contingent on Mr Williams paying Mr Burnitt his investment in the business?

76. [76]
    While there was some debate about the use of the term recission in Mr Burnitt’s pleading, it is of little moment. There can be no issue with the proposition that the parties could agree to terminate their oral agreements.^[51]

77. [77]
    However, counsel for Mr Williams argued that, if an agreement was reached, discharge of the oral agreements was contingent upon Mr Williams paying Mr Burnitt his investment and, further, that Mr Williams was under no contractual obligation to do so.

78. [78]
    This argument relies on a particular interpretation of Mr Burnitt’s evidence about their discussion. Mr Burnitt said:

“Oh, basically he said to me that he had some people wanted to buy into the business and they didn’t want me involved in it and I basically said, ‘well, that’s fine, if you just give to me the money I put in.‘”^[52]

79. [79]
    He also gave evidence that Mr Williams said to him:

“Yes, we’ll pay you the money that you put in and pay you by the end of May.”^[53]

80. [80]
    Counsel for Mr Williams placed emphasis on Mr Burnitt’s evidence that he said “if you just give to me the money I put in”. (emphasis added) He argued this indicated the oral agreements would only be discharged if the money was paid by Mr Williams and, because no payment was made, the oral agreements were not discharged.

81. [81]
    He also argued the language used by Mr Burnitt in conversations after that first discussion was inappropriate in the context of an agreement to pay money on a particular date in exchange for Mr Burnitt’s immediate withdrawal from the business.

82. [82]
    I do not accept that submission. All the dealings between the two were informal. The proposed interpretation imposes the standards of legal precision on a conversation between lay people. The conduct of the parties is consistent with an agreement to pay money by a specified date in exchange for Mr Burnitt’s immediate withdrawal from the business. In fact, Mr Burnitt did immediately withdraw. He played no further active role and Mr Williams did not consult him further about the business.

83. [83]
    It is true that Mr Burnitt said he could not remember sending a letter of demand and there is no evidence that he did.^[54] However, he did chase payment on a number of occasions after May. Other than Mr Williams’ assertion that they discussed putting further money into the business in April 2010, which I reject, the only evidence about contact between the men after March 2010 involved Mr Burnitt chasing payment.

84. [84]
    By March 2010, Mr Williams had not transferred any interest in the business to Mr Burnitt. After the conversation he took no steps to do so. In their subsequent conversations he repeatedly assured Mr Burnitt he would be repaid. Mr Williams’ actions were consistent with an agreement which had discharged him from further performance of the two oral agreements and which imposed an obligation to repay Mr Burnitt what he had invested.

d.) Was the March 2010 agreement ineffective because it did not relate to the contra arrangement?

85. [85]
    Counsel for Mr Williams argued the agreement did not discharge the oral agreements because it dealt only with the cash contribution, not the contra arrangement in relation to the electrical services performed by Logan City Electrical.

86. [86]
    Certainly Mr Burnitt used the term money in his evidence about the March 2010 discussion and the subsequent conversations with Mr Williams. I note, however, that it was not put to Mr Burnitt in cross-examination that all they were discussing in March 2010 was the cash contribution to the purchase price.

87. [87]
    I reject as improbable the proposition that their discussions related only to the cash payments of $300,000. It is unlikely that Mr Burnitt would be willing to forgive payment for work invoiced at more than $300,000, having received little benefit for his very short period of involvement in the business. I accept the submission by counsel for Mr Burnitt that both men understood their discussions as relating to repayment of the purchase price in full.

e.) Was the March 2010 agreement uncertain?

88. [88]
    Counsel for Mr Burnitt objected to my considering this aspect of the Defendant’s submissions because it relies on facts not already pleaded to support the allegation. Nor were the bases upon which the agreement is now said to be uncertain ever put to either Mr Williams or Mr Burnitt.

89. [89]
    The particular matters upon which the Defendant seeks to rely might be summarised as:

1. (a)
   whether the agreement would discharge Beach House Taverns or Jalco from any liability to Mr Burnitt;
2. (b)
   what effect the agreement had in relation to payment for the services invoiced by Logan City Electrical;
3. (c)
   whether the drawings received by Mr Burnitt would be taken into account.

90. [90]
    Counsel for Mr Burnitt has made submissions about why it was not essential to the agreement that these matters were dealt with. However, I do not propose to deal with the merits of the opposing submissions. These matters were not pleaded as essential terms not agreed. The Defendant was given more than one opportunity at trial to put his pleadings in order. The Plaintiff did not object to the allegation of uncertainty being added to the pleading, so long as it did not relate to matters not pleaded. I granted leave to amend on that basis.

91. [91]
    Counsel for Mr Williams did not put the proposition to either party during their evidence that terms dealing with these issues were critical to the certainty of any arrangement to discharge the oral agreements. Mr Burnitt was recalled for further evidence because the Defence was amended after the Plaintiff’s case was closed. In those circumstances, there was no impediment to the Defendant properly pleading and putting its case to the Plaintiff.

92. [92]
    The courts strive to give effect to the intention of the parties, even if they are obscurely expressed.^[55] As I have already stated my findings about the effect of the parties’ conversation in March 2010, it is clear that I do not consider the language used by them to be intractably meaningless.^[56]

93. [93]
    I find an agreement was reached in March 2010 which was effective to terminate the oral agreements. It is not necessary to consider any alternative basis for relief.

3. Conclusion

94. [94]
    I find Mr Williams was personally liable under the agreements reached with Mr Burnitt in September and November 2009. Further, I find Mr Burnitt and Mr Williams entered into an agreement, in March 2010, that terminated the oral agreements, whereupon Mr Burnitt immediately withdrew from the business and Mr Williams was liable to repay Mr Burnitt’s $550,000, the agreed combined purchase price under the two oral agreements made in 2009. I find Mr Williams has not made any payment to Mr Burnitt under the March 2010 agreement. Accordingly, I order Mr Williams to pay Mr Burnitt the sum of $550,000. I will hear from the parties as to the final form of orders as to interest and costs.