O'Brien was joined on his trip by the company's senior development manager, Tim Macmillan, and head of property Richard Champion. The trio of Sydney-based executives, more accustomed to a lifestyle with five-star trimmings, had booked their modest rooms in the family-friendly inn.

Less than 100 metres down the road was a plot of land O'Brien and the private developer and Maxi Foods founder Brendan Blake hoped would become the first Masters store in the fast-growing regional Victorian city. A week earlier the Woolies team had given Blake a letter of offer for a lease for a new Masters store on the site, and they were seeing their new "baby" with their own eyes. 

Yet nine months later, O'Brien was at another meeting, at the RACV Club on Bourke Street in the Melbourne CBD, to discuss a separate property deal in Bendigo with another landholder in town, Stephen Iser. 

Iser is managing director of the family-owned Hume & Iser hardware store, and his business in the centre of town was already on the radar of Woolworths' rival big-box chain Bunnings for its second store in Bendigo. Hours after this meeting on March 9, 2010, O'Brien agreed to communicate with Iser through the hardware store owner's "secret" email account "harrywild", which was named after Iser's family dog, Harry, who is allegedly a "bit wild".

Within months of the RACV Club meeting, Woolworths walked away from the deal with Blake.

Blake is now suing the retail giant for $15.7 million, plus interest and costs, alleging Woolworths squibbed on the deal it had with him to cut Bunnings' lunch. Woolworths' Macmillan and Champion, both having mislaid their notebooks covering this period, have a different version of events. 

The case has laid bare the lengths that Woolworths went to in playing catch-up with Wesfarmers' Bunnings chain.

The stoush comes as Woolworths' loss-making hardware chain continues to fall behind rival Wesfarmers' revenue-churning Bunnings homeware chain.

Blake's barrister, Peter Bick, QC, told the court Woolworths' decision to ditch an existing deal to scupper Bunnings' plans in town was in line with its Project Oxygen strategy, so-called because of its aim to starve the Bunnings chain and in turn Wesfarmers' Coles supermarket business of oxygen, the court heard.

After learning of Bunnings' plan O'Brien told Woolworths' head of property, Richard Champion, via email that he wanted the company to be ready to move on the Hume & Iser site and others "tomorrow/ASAP/pronto/now!!". 

"I will provide whatever is needed to make this happen," O'Brien said to Champion by email. "Even if we expose ourselves to the cost of the unknowns I don't want us waiting."

Yet despite Woolworths' attempt to take on Bunnings in late May, Masters posted its worst quarterly loss of $66 million during the three months to May 1.

Over the past two weeks Blake's lawyer Bick has been grilling Macmillan and Champion over their recollections – or lack thereof – of key events from six years ago.The cross-examinations led Bick to express considerable frustration at O'Brien not being called as a witness.

Woolworths has maintained throughout the case it had the right to ditch its contract with Blake, while Blake's side argues Woolworths had a requirement to negotiate with him on key elements as per the agreement between the two parties before walking away.

The shape and nature of these negotiations – or the lack of negotiations – is at the centre of this dispute.

Woolworths has raised a range of reasons as to why it walked away – Blake had funding issues; the cost of the build proposed by Blake was too high; Blake's property had planning issues. 

Blake – who is no overall-clad country bumpkin with a pitchfork in his hand hoping to strike oil with a lease to one of Woolworths' lesser-performing brands – disputes these reasons.

The besuited Toorak homeowner and Bunnings Ballarat landlord argues he never got a chance to properly strike an agreement with Woolworths on costs, had no funding issues and believes planning on the site was not an issue.

Indeed, Woolworths' Macmillan conceded under heavy cross-examination that he had never assessed the financial position of Blake, had never raised concerns about funding with him and that the notion of Blake having funding issues was his perception after Blake suggested Woolworths might like to bankroll a portion of the development.

The court also heard that Woolworths had fast-track planning approval with the state government over 12 sites and that after receiving a first quote from a builder that was deemed too high, Blake sought a quote from another builder.

On Thursday after the bulk of the evidence and witness examinations wound down, Judge Clyde Croft recommended the matter be sent off for mediation before the next bout of hearings in August.

"My instructions are that's something Woolworths is obviously prepared to participate in," Woolworths' barrister Philip Crutchfield, QC told the court.

A response that Judge Croft described as "very promising".

The case continues. 

- The Age