ispONE Pty Ltd v Telstra Corporation Limited - [2013] FCA 823

FEDERAL COURT OF AUSTRALIA
ispONE Pty Ltd v Telstra Corporation Limited [2013] FCA 823

Citation: ispONE Pty Ltd v Telstra Corporation Limited [2013] FCA 823

Parties: ISPONE PTY LTD (ACN 103 220 766) v TELSTRA CORPORATION LIMITED (ACN 051 775 556)

File number(s): VID 812 of 2013

Judge(s): PAGONE J

Date of judgment: 14 August 2013

Catchwords:
PRACTICE AND PROCEDURE – interlocutory injunction – application to restrain telecommunications provider from terminating supply of services – whether prima facie case established – whether balance of convenience favours the granting of an injunction –whether undertaking as to damages effective – need to do equity by paying into court the amount in dispute – Telstra Corporation Limited v First Netcom – amount to be paid into court – undertaking as to damages – financial position of applicant seeking injunction –undertaking as to damages in circumstances where there is an inextricable link between the applicant’s financial position and the dispute between the parties

Legislation: Australian Consumer Law ss 4, 18, 21(1), 22
Trade Practices Act 1974 (Cth) s 51AA

Cases cited:
Elco Food Co Pty Ltd v Oliana Foods Pty Ltd [2012] FCA 410
Olex Focas Pty Ltd v Skodaexport Co Ltd [1998] 3 VR 380
ACCC v Lux Distributors Pty Ltd [2013] FCA 47
Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618
Varley v Varley [2006] NSWSC 1025
Telstra Corporation Ltd v First Netcom Pty Ltd (1997) 78 FCR 132
Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499

Date of hearing: 13 August 2013

Date of last submissions: 14 August 2013

Place: Melbourne

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 32

Counsel for the Applicant: Mr D Star

Solicitor for the Applicant: K & L Gates

Counsel for the Respondent: Mr J Karkar QC with Mr R Craig

Solicitor for the Respondent: Herbert Smith Freehills

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION

VID 812 of 2013

BETWEEN:
ISPONE PTY LTD (ACN 103 220 766)
Applicant

AND:
TELSTRA CORPORATION LIMITED (ACN 051 775 556)
Respondent

JUDGE:

PAGONE J

DATE OF ORDER:

14 AUGUST 2013

WHERE MADE:

MELBOURNE

Upon the Applicant undertaking, by its Counsel:
(a)to submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of the interlocutory order or undertaking or any continuation (with or without variation) thereof; and
(b)to pay the compensation referred to in (a) to the person there referred to; and
and conditional upon the Applicant:
(c)giving irrevocable directions in the form specified in Annexures A and B to this Order to the persons specified in those directions within 24 hours of the making of this order; and
(d)filing and serving an affidavit verifying notification of the direction referred to in (c) to the persons named in Annexures A and B forthwith.

THE COURT…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] FCA 823
Decision Date: 14 August 2013

CaseChat Overview and Summary

ISPONE Pty Ltd sought an interlocutory injunction against Telstra Corporation Limited to restrain Telstra from terminating its supply of services. The matter was heard in the Federal Court. The applicant argued that it had established a prima facie case for the relief sought and that the balance of convenience favoured the granting of the injunction. Additionally, the applicant provided an undertaking as to damages, which was a crucial factor in the court's consideration. The applicant also argued that it was not necessary to pay the amount in dispute into court, as the financial position of ISPONE was inextricably linked to the dispute.

The court examined whether ISPONE had established a prima facie case, whether the balance of convenience favoured the grant of the injunction, and whether the undertaking as to damages was sufficient. The court considered Telstra’s right to terminate the contract and the need for ISPONE to do equity by paying into court the amount in dispute. The court also considered the financial position of ISPONE and the inextricable link between this position and the dispute. The court concluded that ISPONE had established a prima facie case, the balance of convenience favoured the injunction, and the undertaking as to damages was sufficient, particularly given the financial position of ISPONE.

The court granted the injunction, restraining Telstra from acting on any Breach Notices, terminating the Customer Relationship Agreement, and terminating the supply of services. The court also directed that the proceeding be listed for directions, that the applicant file and serve written submissions by a specified date, and that costs be reserved. The court recognised the importance of the financial position of ISPONE in its decision-making process.

The court's final orders included restraining Telstra from acting on any Breach Notices, terminating the Customer Relationship Agreement, and terminating the supply of services until the trial or further order. The proceeding was listed for directions, and ISPONE was directed to file and serve written submissions by a specified date. Costs were reserved, and liberty to apply was granted.

Orders

Orders of the court

1. Until trial or further order, the Respondent be restrained from:

(a) acting on any of the Breach Notices as defined in paragraph 67 of the Affidavit of Zac Swindells affirmed on 12 August 2013;

(b) terminating the Customer Relationship Agreement between the applicant and the respondent dated 18 May 2005, as varied by the Variation Agreement dated 21 November 2012;

(c) terminating the supply of services contemplated by the CRA to the Applicant including but not limited to the Service as defined in CRA-84 – Telstra Wholesale Pre-Paid Mobile Service Schedule.

2. The proceeding be listed for directions at 10:15am on 15 August 2013.

3. The applicant file and serve by 9:30am on 15 August 2013 full written submissions in support of its claims against the respondent for final relief upon the assumption that the applicant’s evidence-in-chief be the materials filed in the proceeding.

4. Costs be reserved.

5. Liberty to apply.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citation:		ispONE Pty Ltd v Telstra Corporation Limited [2013] FCA 823
Parties:		ISPONE PTY LTD (ACN 103 220 766) v TELSTRA CORPORATION LIMITED (ACN 051 775 556)
File number(s):		VID 812 of 2013
Judge(s):		PAGONE J
Date of judgment:		14 August 2013
Catchwords:		PRACTICE AND PROCEDURE – interlocutory injunction – application to restrain telecommunications provider from terminating supply of services – whether prima facie case established – whether balance of convenience favours the granting of an injunction –whether undertaking as to damages effective – need to do equity by paying into court the amount in dispute – Telstra Corporation Limited v First Netcom – amount to be paid into court – undertaking as to damages – financial position of applicant seeking injunction –undertaking as to damages in circumstances where there is an inextricable link between the applicant’s financial position and the dispute between the parties
Legislation:		Australian Consumer Law ss 4, 18, 21(1), 22 Trade Practices Act 1974 (Cth) s 51AA
Cases cited:		Elco Food Co Pty Ltd v Oliana Foods Pty Ltd [2012] FCA 410 Olex Focas Pty Ltd v Skodaexport Co Ltd [1998] 3 VR 380 ACCC v Lux Distributors Pty Ltd [2013] FCA 47 Beecham Group Ltd v Bristol Laboratories Pty Ltd (1968) 118 CLR 618 Varley v Varley [2006] NSWSC 1025 Telstra Corporation Ltd v First Netcom Pty Ltd (1997) 78 FCR 132 Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499
Date of hearing:	13 August 2013
Date of last submissions:	14 August 2013
Place:	Melbourne
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	32
Counsel for the Applicant:	Mr D Star
Solicitor for the Applicant:	K & L Gates
Counsel for the Respondent:	Mr J Karkar QC with Mr R Craig
Solicitor for the Respondent:	Herbert Smith Freehills

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 812 of 2013

BETWEEN:	ISPONE PTY LTD (ACN 103 220 766) Applicant
AND:	TELSTRA CORPORATION LIMITED (ACN 051 775 556) Respondent

JUDGE:	PAGONE J
DATE OF ORDER:	14 AUGUST 2013
WHERE MADE:	MELBOURNE