FEDERAL COURT OF AUSTRALIA
Intel Corporation v Unwired Group Ltd
[2008] FCA 1927
PRACTICE AND PROCEDURE – Federal Court – original jurisdiction – summary judgment – motions filed seeking judgment under Federal Court of Australia Act 1976 (Cth), s 31A – application to strike out parts of defence Federal Court Rules, O 11 r 16
CONTRACTS & DEEDS – principles of construction – commercial transaction – deed poll – circumstances where A raised money by issuing convertible notes to B pursuant to deed poll, which required A to pay an additional amount equal to 50% of initial investment in notes to B in certain circumstances which occurred – ordinary principles of construction of contracts – whether reasonable prospects of successfully arguing that certain terms ought be implied into deed poll
CONTRACT – good faith – implied term – whether reasonable prospects of successfully arguing implied obligation to act reasonably and in good faith in particular class of contract – convertible notes – transferable security
TRADE PRACTICES AND RELATED MATTERS – Trade Practices Act 1974 (Cth) misuse of market power – whether reasonable prospects of successfully arguing contravention of s 46(1) – definition of “market” – misleading and deceptive conduct – whether reasonable prospects of successfully arguing contravention of s 52
CONTRACT – penalty – whether reasonable prospects of successfully arguing amount payable under deed poll was penalty – novel claim – circumstances where payment dependant on occurrence of event (change of control or delisting of issuing company) not breach of contract or covenant – circumstances where defence not articulated precisely or clearly enough to bring out novel claim
PRACTICE AND PROCEDURE – pleadings – need to articulate and bring forward clearly, precisely and definitively, the real issues to be litigated – costs of litigation – purpose of case management – efficient and proper conduct of civil litigation
Federal Court of Australia Act 1976 (Cth), ss 31A,
Jurisdiction of Courts (Cross-Vesting) Act 1987 (Cth), s 6(1)
Trade Practices Act 1974 (Cth), ss 46(1)(b), (c), 52
Federal Court Rules, O 11 r 16AMEV-UDC Finance Ltd v Austin (1986) 162 CLR 170 cited
Baulderstone Hornibrook Engineering Pty Ltd v Gordian Runoff Ltd [2008] NSWCA 243 referred to
BP Refinery Westernport Pty Limited v Shire of Hastings (1977) 180 CLR 266 cited
GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd (2003) 128 FCR 1 referred to
Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd (2008) 244 ALR 1 referred to
IAC (Leasing) Ltd v Humphrey (1972) 126 CLR 131 cited
Integral Home Loans Pty Ltd v Interstar Wholesale Finance Pty Ltd [2007] NSWSC 406 considered
Interstar Wholesale Finance Pty Ltd v Integral Home Loans Pty Ltd [2008] NSWCA 310 referred to
Lamson Store Service Co Ltd v Russell Wilkins & Sons Ltd (1906) 4 CLR 672
Maniotis v JH Lever & Co Pty Ltd [2006] FCAFC 7 referred to
Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116 cited
NT Power Generation v Power…
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- AGLC
- Intel Corporation v Unwired Group Ltd [2008] FCA 1927
- Case
- [2008] FCA 1927
- Decision Date
CaseChat Overview and Summary
The court was required to decide whether the redemption premium amount stipulated in the contract was a penalty and thus unenforceable, and whether Intel had breached any implied terms as alleged by Unwired. Additionally, the court had to consider the validity of several other contractual provisions and allegations of misconduct under the Trade Practices Act. The court found that some of Unwired's defences were insufficiently pled and did not disclose a valid defence under the law, leading to their striking out. The court also ruled that certain sections of the contract were enforceable, while others were deemed void.
The court granted judgment in favor of Intel for the majority of the claims, except those relating to the redemption premium amount and any interest thereon. It ordered that Unwired had the opportunity to replead their defences concerning the redemption premium and other specified claims within a set timeframe. The court also mandated the provision of particulars and ordered cost allocations between the parties. The matter was subsequently re-listed for further directions.
Orders
Orders of the court
1. Judgment be entered for the Applicant in the amount of $38,596,272.29 on all parts of the proceeding, except those parts relating to the Applicant’s claim to be paid the Redemption Premium Amount and any interest on that amount, and without prejudice to the Applicant’s right to claim the Redemption Premium Amount and any interest thereon.
2. The proceedings be re-listed on 11 December 2008 at 9.30am.
THE COURT NOTES THAT:
1. The judgment sum is in an amount, the calculation of which is agreed.
2. The judgment sum has been entered on the basis that the Respondent conceded that it had no basis on which it could defend that claim.
Note:
1. Judgment be given for the Applicant under s 31A(2) of the Federal Court Act 1976 in relation to the Respondent's claim that the Applicant breached the implied terms pleaded in paragraphs 43, 44, 50(e) and 50(f) of the Amended Defence and corresponding paragraphs of the Amended Cross-Claim.
2. Further, the following paragraphs of the Amended Defence (and corresponding paragraphs of the Amended Cross-Claim) be struck out under Order 11, Rule 16:
(a) Sub-paragraphs 9(b) and (c) (relating to the validity of the declaration made by the Applicant on 15 May 2008);
(b) paragraphs 33, 33A and 100 to 110 (relating to whether Intel made the WiMAX RPA Representation and/or engaged in the WiMAX RPA Conduct in breach of s52 of the Trade Practices Act);
(c) paragraphs 51 and 52 (relating to the construction of Clause 9.4 of the Terms and Conditions of the Deed Poll);
(d) paragraphs 53 and 54 (relating to the construction of clauses 1.1, 6.2 and 6.3 of the terms and conditions of the Notes);
(e) paragraph 63 (relating to the Principal and Redemption Premium Amount not being payable as a result of the terms of the Deed Poll);
(f) paragraphs 68 to 71 and 73 (relating to breach of the terms of the Deed Poll);
(g) paragraphs 74 and 75 (relating to whether the Redemption Premium Amount is void and unenforceable as a penalty);
(h) paragraphs 111 to 116 (relating to equitable estoppel); and
(i) paragraphs 117 to 129 (relating to the Respondent's case under s46 of the Trade Practices Act).
3. The Respondent have leave to file a Further Amended Defence and a Further Amended Cross-Claim by 13 February 2009 which re-pleads:
(a) its claim that the Redemption Premium Amount is void or unenforceable as a penalty.
(b) its claim based on breach of s46 of the Trade Practices Act.
4. The Respondent provide the particulars sought in paragraphs 1, 2, 6 to 11 of the schedule to the letter dated 9 September 2008 from Allens Arthur Robinson to Clayton Utz by 13 February 2009.
5. The Respondent pay:
(a) the Applicant's costs of the Respondent's notice of motion; and
(b) 90% of the Applicant's costs of the Applicant's notice of motion.
6. The matter be listed for further directions on 20 February 2009 at 9.30am.
Note:
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
Established by: RARES J
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