Global Network Services Pty Ltd v Legion Telecall Pty Ltd

NEW SOUTH WALES COURT OF APPEAL

CITATION:      GLOBAL NETWORK SERVICES PTY LTD v LEGION TELECALL PTY LTD [2001]  NSWCA 279

FILE NUMBER(S):
41036/99

HEARING DATE(S):               27, 28 March 2001

JUDGMENT DATE: 28/08/2001

PARTIES:
GLOBAL NETWORK SERVICES PTY LTD v LEGION TELECALL PTY LTD

JUDGMENT OF:       Mason P Meagher JA Beazley JA   

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S):          

LOWER COURT JUDICIAL OFFICER:     Rolfe J

COUNSEL:
Appellant: P L Brereton SC / M Meek
Respondent: W H Nicholas QC / J Stevenson

SOLICITORS:
Appellant: Michael Saunders & Associates
Respondent: Michell Sillar

CATCHWORDS:
Contract - Breach - Construction of term - psychic telephone services - contract between Service Bureau and Call Processing Centre to direct all calls through call processing centre - whether duty absolute or duty to use best endeavours - whether failure to secure third parties' business for call processing centre amounted to breach of term - Assessment of Damages. (ND)

LEGISLATION CITED:

DECISION:
Appeal and cross appeal dismissed with costs

JUDGMENT:

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 41036/99

MASON P
MEAGHER JA
BEAZLEY JA

Tuesday 28 August 2001

GLOBAL NETWORK SERVICES PTY LTD v
LEGION TELECALL PTY LTD

This appeal involves a contract (the Contract) made between Global Network Services Pty Ltd (Global) and Legion Telecall Pty Ltd (Legion) on 30 November 1994.  Both Global and Legion are part of the Telstra’s 190 InfoCall Services for psychic related services.  In November 1994 Legion was arranging to become InfoCall’s Service Bureau for the 190 premium services providing psychic services. It was also setting itself up as a service provider under the name “Psychic Live” with five 190 telephone lines.  Global also proposed to function as a service provider trading as “Psychic Hotline” (later “Psychic Express”).  Through the Contract Legion engaged Global to operate the Call Processing Centre (CPC) for its “Psychic Live” services.

In clause 1(k) of the Contract, Legion agreed:
  “to direct all 190 Psychic and Psychic-related call processing requests through Global’s Psychic Call Centre, with the exception of the current one-off Athena Starwoman – Woman’s Day Star Cards Promotion.”

Apart from Global and Legion, there were at least three others within the market of psychic service providers – Athena Starwoman, Mystic Meg and Suzanne Myles (the 190 Other lines).  The 190 Other Lines needed to contract with Legion to obtain a 190 number.  They would also need a CPC. Legion contracted with the three psychic service providers, but the 190 Other Lines chose not to use Global as their CPC. 

The central question in the appeal is whether Legion’s failure to direct call requests to the Other 190 lines through Global constituted a breach of clause 1(k).

At trial, the parties agreed that 1,125,447 minutes of 190 Other Lines psychic and psychic-related calls were received by Legion and not directed to Global.  Rolfe J found for Global on all issues of contract and breach.  Clause 1(k) was not limited to the role that Global would play in the Psychic Live and…