Memorex Telex Pty Ltd v National Databank Ltd

In the matter of Memorex Telex Pty Ltd v National Databank Ltd, the dispute centred around outstanding invoices for computer goods and services, known as the System, which Memorex Telex, the plaintiff, had supplied to National Databank, the defendant. The case was heard in the court, where the plaintiff sought payment for the invoices, and the defendant filed a cross-claim for liquidated damages due to late and incomplete delivery of the System, as well as additional claims for expenses incurred in rectifying the System and for loss of revenue or loss of opportunity.

The central legal issues revolved around the extent of the defendant's entitlement to damages, particularly whether the court could infer the quantum of damages based on evidence of problems with the System and the low revenue generated, without any direct evidence from users that they experienced issues with the System that led to termination of their subscriptions with the defendant. The court also needed to consider the implications of the System's completion being undertaken by the defendant's employees, who had previously been employed by the plaintiff, without any prior claim or notification to the plaintiff.

The court analysed the evidence presented and concluded that, while there were issues with the System and the defendant's revenue was low, there was insufficient evidence to directly link these problems to user dissatisfaction and subscription terminations. Consequently, the court determined that the defendant was not entitled to the full extent of the claimed damages. The court also noted the peculiar circumstances of the System's completion by the defendant's employees, who had previously been employed by the plaintiff, without any notification to the plaintiff until the delivery was complete. The court's decision was that the defendant was not entitled to the full amount of liquidated damages claimed, and the matter was to be assessed on a more limited basis, taking into account the actual problems experienced with the System and the evidence of revenue loss.