D'Arling One Pty Ltd v Eagle Boys Dial-A-Pizza Pty Limited

[2009] NSWSC 570

CITATION:	D'Arling One Pty Ltd v Eagle Boys Dial-A-Pizza Pty Limited [2009] NSWSC 570
HEARING DATE(S):	12 June 2009
JUDGMENT OF:	Gzell J
EX TEMPORE JUDGMENT DATE:	12 June 2009
DECISION:	Application dismissed with costs
CATCHWORDS:	PROCEDURE - Injunctions - vendors claim for specific performance of sale of business including franchise agreement from defendant - defendant purported to terminate franchise agreement - interlocutory injunction sought - whether damages are suitable remedy
PARTIES:	D'Arling One Pty Ltd (Plaintiff) Eagle Boys Dial-A-Pizza Pty Limited (Defendant)
FILE NUMBER(S):	SC 3150/09
COUNSEL:	G Waugh (Plaintiff) D O'Brien (Defendant)
SOLICITORS:	HWL Ebsworth, Lawyers (Plaintiff) Mullins Lawyers (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

FRIDAY 12 JUNE 2009

3150/09 D’ARLING ONE PTY LIMITED v EAGLE BOYS DIAL-A-PIZZA AUSTRALIA PTY LIMITED

EX TEMPORE JUDGMENT

1 The plaintiff held a franchise agreement from the defendant, which the defendant purported to terminate on 9 June 2009. The plaintiff seeks an injunction restraining the defendant from acting upon its purported termination of the franchise agreement.

2 The plaintiff says that the defendant did not have the justification contractually to terminate the franchise agreement and was in breach of that agreement in so acting.

3 It is not every breach of contract that gives rise to an entitlement to an interlocutory injunction. In the auxiliary jurisdiction, injunctions are granted in the case of breaches of negative stipulations in contracts, express or implied.

4 But what is fatal to the application is that damages are an adequate remedy. In what is termed a second mediation agreement, the defendant agreed to purchase the plaintiff’s business for $250,000. There was a requirement that the plaintiff effectively de-brand products at other premises and surrender the franchise for those premises. That has been done.

5 The plaintiff is seeking specific performance of so much of the second mediation agreement as relates to the obligation of the defendant to purchase its business. If the defendant had done so, the plaintiff would have surrendered the franchise agreement.

6 It is submitted that if damages are sought in lieu of specific performance, there may be some difficulty in calculation of damages during the period when no business operates from the premises.

7 But damages for failure to purchase the business are quantified by the amount for which the plaintiff was prepared to sell its business: $250,000. Any question of difficulty of calculation of damages for a period beyond the due date for settlement of the sale of the business is, in my view, irrelevant.

8 Not only are damages a suitable remedy, they have been crystallised in the amount agreed to be paid for the business.

9 As damages are a suitable remedy, the prayer for interlocutory relief must fail. I order the plaintiff to pay the defendant’s costs.

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