Wyong Shire Council v Jenbuild [2012] NSWSC 720 (19 June 2012)


[COMMERCIAL ARBITRATION] – contracts – whether contracts made between the plaintiff and the first defendant constitute a valid arbitration agreement for the purposes of s 7 of the Commercial Arbitration Act 2010 (NSW) – whether contract ancillary to the principal contracts governed the dispute resolution process.

[ESTOPPEL] – estoppel in pais – convention; estoppel by – whether sufficient detriment that parties are estopped from denying their contractual relationship is governed by a dispute resolution clause.

24. The Council replied by email of 18 January 2010, appointing a meeting for 21 January 2010 at 3pm. That was changed to 1pm on Friday, 22 January 2010. That meeting occurred.

25. In relation to that meeting, Mr Jensen of Jenbuild sent an email on 21 January 2010. Mr Corsaro of Senior Counsel, who appeared for the Council, objected to the tender of that email, relying on s 131 of the Evidence Act 1995 (NSW). He submitted that the email was a communication made between persons in dispute in connection with an attempt to negotiate a settlement of the dispute.

26. I do not think that a document appointing a meeting for a contractual purpose (for example, in compliance with alternative 1 set out in cl 47.2 of the general conditions of contract) is a “communication” of the kind referred to in s 131(1)(a). The purpose of s 131 is, as its heading indicates, to exclude evidence of what is said or communicated in the course of settlement negotiations. That reflects the law’s concern to ensure that parties in dispute should be free to attempt to settle their disputes, without curial, arbitral or other imposed resolution, without being put at risk that what is said in an attempt to negotiate a settlement will be used in evidence against them at a later time. The fact that there was to be a meeting can hardly be of any significance, particularly where that meeting was one (on Jenbuild’s case) required by the contract to be held. Nor did the email, to the extent that I admitted it, give any clue as to what had been said at the previous meeting, or what might be said at the meeting to be held later on the day the email was sent.

27. The email did however proceed further, and make observations as to the Council’s conduct, apparently in the prior settlement meeting, in a way that did seem to me to infringe s 131. Accordingly, I rejected those paragraphs of the email from the tender.
28. However, at a later stage in the course of the hearing, Mr Corsaro then sought to tender those two paragraphs. When he did so, they were admitted. It appears that he sought to do so because he wanted to make the point that Jenbuild had proposed binding expert determination. That submission in turn prompted Mr Roberts of Senior Counsel, who appeared for Jenbuild, to tender a letter of 15 April 2009 from Jenbuild to the Council which had earlier been tendered and rejected on s 131 grounds (and on Mr Corsaro’s application). Mr Roberts renewed the tender of that letter and I admitted it.

29. I have to say that all of this seems to me to be much ado about nothing. However, it will be necessary to return to the submission, as to expert determination, in due course.