APG Aus No 3 Pty Ltd v Quasar Resources Ptd Ltd

The case concerned the interpretation of a royalty clause of a tenement sale agreement. APG Aus had assumed the right to receive a percentage 'net smelter royalty' from minerals mined by Quasar from various tenements. Under the contract, Quasar was entitled to deduct 'Allowable Charges', being 'charges, costs and penalties, if any, for … refining', from gross sale proceeds prior to paying the royalty. APG Aus contended for a narrow interpretation of the term 'refining' and claimed that Quasar did not incur any costs for refining. The issue was financially very significant: Quasar claimed Allowable Charges of 60%-120% of its gross sale proceeds.

The Supreme Court heard evidence as to the use of the term 'refining' in the mining industry, including from various experts and preferred APG Aus's narrow interpretation. It held that the term meant the final processing of metal bearing products whereby impurities were physically separated from the metallic intermediate product resulting in a pure or nearly pure metal final product, and did not include any purification processes prior to this. In turn, the Court held that no refining occurred at Quasar's plant in Australia and therefore that Quasar was not entitled to deduct the costs of these for the purposes of the calculation of its royalty.

Talent Konnects Pty Ltd v Marvelli

Talent Konnects is a labour hire agency involved in the recruitment of employees in the mining and hospitality sector. The defendants were employees of Talent Konnects. They had recently resigned and shortly afterwards became employed by a competitor of Talent Konnects. There were clauses in their employment contracts with Talent Konnects preventing them from working for a competitor of Talent Konnects for six months after leaving and relating to various other post-employment restrictions. Talent Konnects sought an interlocutory injunction to restrain the defendants from working for their new employer for six months and to prevent related potential breaches of their employment contracts.

The Supreme Court held that the six month prohibition was arguably unreasonable in terms of the duration and therefore contrary to public policy in relation to restraint of trade. Further, the Court held that the defendants would incur financial losses if they were prevented from working for their new employer, which was a factor weighing against granting an injunction. However, the Court held that Talent Konnects was entitled to an interlocutory injunction to prevent the defendants from soliciting certain clients or employees from Talent Konnects and from disclosing to their new employer certain information which was confidential to Talent Konnects. This was on the basis that Talent Konnects was entitled to be protected against the risk of breach of those restraints in the defendants' employment contracts.

Recce Pharmaceuticals Ltd v Ian David Brown

The case was an appeal from the decision of the Supreme Court requiring the conversion of performance shares into ordinary shares of the company. Recce Pharmaceuticals refused to convert the performance shares of Mr Brown, a former non-executive director, and certain other former directors and employees, into ordinary shares, arguing they did not contribute to the achievement of the relevant performance milestones because they had ceased to be directors or employees. The performance shares were issued in August 2015, Mr Brown and others ceased being directors and employees of Recce Pharmaceuticals in 2017, and Recce Pharmaceuticals achieved the relevant performance milestone (relating to the company's weighted average share price) in 2020.

The Court of Appeal rejected Recce Pharmaceuticals' argument that Mr Brown and others had to remain directors or employees of the company and contribute to the company achieving the milestone. The Court held that the relevant milestones could not be solely attributed to the performance of Mr Brown and others because share prices are affected by matters unrelated to a company's performance. Further, the resolution creating the performance shares was unqualified in its language, stipulating that the performance shares 'will' convert upon achievement of the specified milestone. The Court of Appeal therefore upheld the Supreme Court's decision requiring the conversion of performance shares into ordinary shares.

Decmil Australia Pty Ltd v Avid Australia Holdings Pty Ltd

Decmil subcontracted work to Avid Resources under two separate subcontracts. Both contained provisions requiring payment to be made by the subcontractor to the contractor. These provisions required payment to be made within 10 days after the issue of the relevant invoice. The subcontracts also included guarantees whereby Avid Australia Holdings would indemnify Decmil against all liability and loss incurred as a result of a default by Avid Resources. Decmil issued invoices under the subcontracts totalling $1.3 million, which Avid Resources failed to pay within 10 days. Both subcontracts included dispute resolution clauses, but did not provide any grounds for the deferral of a payment pending resolution of a dispute.

The Supreme Court determined that the subcontracts simply required an invoice to be issued and for the invoice to be paid within 10 days. Further, because the dispute resolution clauses did not provide for any deferral of payment in the event of a dispute, there was nothing that suspended Decmil's right to have the invoice paid. The Court also found that the 'pay-to-play' provision of the subcontracts was a 'perfectly sensible commercial arrangement', despite Avid Australia Holdings contending that it was commercially unreasonable for the contract to be interpreted as requiring payment of an invoice prior to a dispute being resolved. The effect of this was that Avid Resources' failure to pay the invoices within 10 days meant that they were in default of the subcontracts and that Avid Australia Holdings was liable to indemnify Decmil under the guarantees.

Note: this case is currently pending an appeal.

Re Delecta Ltd; Ex Parte Delecta Ltd [2022] WASC 163 and Re Sprintex Ltd; Ex Parte Sprintex Ltd

The Court found that the pre-conditions to granting the validation were met as:

• the failure to lodge a cleansing notice was essentially of a procedural nature;
• there was no failure to act honestly, with the failure to lodge the cleansing notices an inadvertent oversight by the company secretary based on a misunderstanding of the requirements to cleanse securities prior to their sale;
• it would be just and equitable to grant relief; and
• no substantial injustice had been, or was likely to be caused, to any person.