Quality Bakers Australia Pty Limited v ISS Facility Management Pty Ltd [2021] NSWCA 74

Quality Bakers Australia Pty Limited v ISS Facility Management Pty Ltd [2021] NSWCA 74

Clause 10 was not engaged. Even if "revised offer" meant a sufficiently detailed commercial proposal rather than a legally binding offer, the 11 May 2018 Status Update was an interim, qualified analysis for discussion, expressly excluding commercial impacts and omitting key commercial information, and was not a revised offer. Nor did it show that ISS insisted on any financially less favourable terms; Goodman Fielder could not identify with precision any term ISS insisted upon before the Expiry Date. Clause 10 had to be assessed by reference to conduct before the Expiry Date, because cl 10 was tethered to cl 8 and the liability to reimburse arose when no Proposed Agreement had been entered...

Jurisdiction
Australia
Judgment Date
30 April 2021
Procedural Posture
Civil Appeal Concerning Construction of a Commercial Contract and Reimbursement of Due Diligence Costs / Appeal From the District Court of New South Wales, Civil Jurisdiction, [2020] NSWDC 447
Outcome
Appeal dismissed with costs
Legal Topics
['contract Construction' 'letter of Intent' 'due Diligence Costs' 'good Faith Negotiations' 'expiry Date' 'revised Offer' 'commercial Proposal' 'facilities Management Services']
['contract Law' 'civil Procedure'] ['contract Construction' 'letter of Intent' 'due Diligence Costs' 'good Faith Negotiations' 'expiry Date' 'revised Offer' 'commercial Proposal' 'facilities Management Services']

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Procedural Posture

Civil Appeal Concerning Construction of a Commercial Contract and Reimbursement of Due Diligence Costs / Appeal From the District Court of New South Wales, Civil Jurisdiction, [2020] NSWDC 447

Legal Issues

  1. 1 ['Whether the primary judge erred in construing the phrase "revised offer" in cl 10 as an offer capable of acceptance in the contractual sense rather than a commercial proposal.' 'Whether the Status Update sent on 11 May 2018 was a "revised offer" within the meaning of cl 10 of the Agreement.' 'Whether ISS insisted on entering into a Proposed Agreement on terms financially less favourable to Goodman Fielder than the Key Terms in Appendix 1.' 'Whether conduct after the Expiry Date of 14 May 2018 could be taken into account in determining whether cl 10 was engaged.' 'Whether Goodman Fielder was obliged under cl 8 to reimburse ISS for due diligence costs up to AU$600,000 plus GST.']

Ratio Decidendi

Clause 10 was not engaged. Even if "revised offer" meant a sufficiently detailed commercial proposal rather than a legally binding offer, the 11 May 2018 Status Update was an interim, qualified analysis for discussion, expressly excluding commercial impacts and omitting key commercial information, and was not a revised offer. Nor did it show that ISS insisted on any financially less favourable terms; Goodman Fielder could not identify with precision any term ISS insisted upon before the Expiry Date. Clause 10 had to be assessed by reference to conduct before the Expiry Date, because cl 10 was tethered to cl 8 and the liability to reimburse arose when no Proposed Agreement had been entered...

Court Disposition

Appeal dismissed with costs

Orders

  • ['Appeal dismissed with costs.']