Springfield City Group Pty Ltd v Pipe Networks Pty Ltd - [2022] QSC 255

SUPREME COURT OF QUEENSLAND

CITATION: Springfield City Group Pty Ltd v Pipe Networks Pty Ltd [2022]
QSC 255
PARTIES: SPRINGFIELD CITY GROUP PTY LTD
ACN 055 714 531
(plaintiff)
v
PIPE NETWORKS PTY LTD
ACN 099 104 122
(defendant)
FILE NO: BS 2798 of 2016
DIVISION: Trial Division
PROCEEDING: Claim
DELIVERED ON: 18 November 2022
DELIVERED AT: Brisbane

HEARING DATE:

9–13 and 16–20 November 2020; 16, 19–20 and 31 August 2021. Further written submissions received by the defendant 6 September 2021; and by the plaintiff 13 September 2021
JUDGE: Bond JA
ORDERS: The orders of the Court are:

1. Judgment for the defendant on the plaintiff’s claims.
2. I will hear the parties as to costs.
CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL

PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – IMPLIED TERMS – GENERALLY – where the plaintiff contracted with the defendant – where the plaintiff agreed to finance the construction by the defendant of a fibre optic cable network between Brisbane and Springfield – where the defendant constructed, operated and maintained that network for the plaintiff – where the defendant installed their own fibre optic cable network in the pits and conduits which accommodated the plaintiff’s network – where the plaintiff contends that the defendant must be regarded as contractually constrained against constructing and operating that duplicate network either as a matter of the proper construction of the contract or by the implication of relevant terms – whether the defendant breached the contract

TRADE AND COMMERCE – COMPETITION, FAIR TRADING AND CONSUMER PROTECTION

LEGISLATION – CONSUMER PROTECTION –

MISLEADING OR DECEPTIVE CONDUCT OR FALSE REPRESENTATIONS – MISLEADING OR DECEPTIVE CONDUCT GENERALLY – GENERALLY – where the plaintiff agreed to finance the construction by the defendant of a fibre optic cable network between Brisbane and Springfield – where the defendant constructed, operated and maintained that network for the plaintiff – where the defendant installed their own fibre optic cable network in the pits and conduits which accommodated the plaintiff’s network – where the plaintiff contends that the defendant expressly, implicitly or by its silence made representations to the plaintiff in a manner apt to mislead – whether those representations induced the plaintiff to enter into the contracts – whether those representations constituted misleading and deceptive conduct on the part of the defendant – whether the defendant engaged in further post-contractual acts of misleading and deceptive conduct

TRADE AND COMMERCE – COMPETITION, FAIR TRADING AND CONSUMER PROTECTION LEGISLATION – CONSUMER PROTECTION – UNCONSCIONABLE CONDUCT – GENERALLY – where the plaintiff agreed to finance the construction by the defendant of a fibre optic cable network between Brisbane and Springfield – where the defendant installed their own duplicate network in the pits and conduits which accommodated the plaintiff’s network – whether by constructing and operating the duplicate network in competition with the plaintiff the defendant contravened statutory unconscionable conduct provisions

COMMUNICATIONS LAW –

TELECOMMUNICATIONS – CARRIAGE SERVICE PROVIDER – where the plaintiff agreed to finance the construction by the defendant of a fibre optic cable network between Brisbane and Springfield – where the defendant installed their own duplicate network in the pits and conduits which accommodated the plaintiff’s network – where the defendant was a licenced telecommunications carrier – whether the Telecommunications Act 1997 (Cth) imposed a duty on the defendant to give notice to the plaintiff before constructing the duplicate network in the off-rail sections of the plaintiff’s network

TORTS – INTERFERENCE WITH PROPERTY – INTERFERENCE WITH GOODS – TRESPASS TO GOODS – OTHER MATTERS – where the defendant constructed, operated and maintained a fibre optic cable

network for the plaintiff – where in so doing, the defendant installed their own fibre optic cable network in the pits and conduits which accommodated the plaintiff’s network – where the plaintiff contends that the defendant committed a trespass when laying that duplicate network in the infrastructure which accommodated the plaintiff’s network – whether the defendant spliced into the plaintiff’s fibres constituting trespass

TORTS – INTERFERENCE WITH PROPERTY – INTERFERENCE WITH GOODS – CONVERSION AND DETINUE – CONVERSION – OTHER PARTICULAR CASES – where the defendant constructed, operated and maintained a fibre optic cable network for the plaintiff – where in so doing, the defendant installed their own fibre optic cable network in the pits and conduits which accommodated the plaintiff’s network – where the plaintiff contends that the defendant’s independent contractors spliced into particular fibres on cable which should be regarded as the plaintiff’s – whether the defendant converted the relevant fibres by using them

EQUITY – GENERAL PRINCIPLES – FIDUCIARY OBLIGATIONS – GENERALLY – where the plaintiff contracted with the defendant – where the plaintiff agreed to finance the construction by the defendant of a fibre optic cable network between Brisbane and Springfield – where in so doing, the defendant installed their own duplicate network in the pits and conduits which accommodated the plaintiff’s network – whether the defendant owed fiduciary duties to the plaintiff – whether by constructing and operating the duplicate network without the plaintiff’s consent the defendant breached fiduciary duties which it owed to the plaintiff
Telecommunications Act 1997 (Cth), s 5, s 42, pt 3 div 4, sch 3 s
17
Trade Practices Act 1974 (Cth), s 4D(2), s 45
Adani Abbot Point Terminal Pty Ltd v Lake Vermont Resources
Pty Ltd & Ors [2021] QCA 187, cited
Adaz Nominees Pty Ltd v Castleway Pty Ltd [2020] VSCA 201,
cited
Australis Media Holdings Pty Ltd v Telstra Corporation Ltd
(1998) 43 NSWLR 104, cited
Baldwin v Icon Energy Ltd [2016] 1 Qd R 397, cited
Barboza v Blundy & Ors [2021] QSC 68, cited
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180
CLR 266, cited
Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1, cited
Codelfa Constructions Pty Ltd v State Rail Authority of New
South Wales (1982) 149 CLR 337, cited
Commercial Union Assurance Company of Australia Ltd v
Ferrcom Pty Ltd (1991) 22 NSWLR 389, cited
Commonwealth Bank of Australia v Barker (2014) 253 CLR 169,
cited
Darlington Futures Ltd v Delco Australia Pty Ltd (1986) 161 CLR
500, cited
Henderson v Queensland (2014) 255 CLR 1, cited
Hollis v Vabu Pty Ltd (2001) 207 CLR 21, cited
Jewelsnloo Pty Ltd v Sengos [2016] NSWCA 309, cited
Jones v Dunkel (1959) 101 CLR 298, cited
King Tide Company Pty Ltd v Arawak Holdings Pty Ltd [2017]
QCA 251, cited
Murray v Murray (1960) 33 ALJR 521, cited
Re Day (2017) 91 ALJR 262, cited
Secured Income Real Estate (Australia) Ltd v St Martins
Investments Pty Ltd (1979) 144 CLR 596, cited
Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161, cited
Wagners Cement Pty Ltd & Anor v Boral Resources (Qld) Pty Ltd
& Anor [2020] QSC 124, cited
Westpac Banking Corporation v Hughes [2012] 1 Qd R 581, cited
Wormald v Maradaca Pty Ltd [2020] NSWCA 289, cited
COUNSEL: D A Savage KC, C R C Newlinds SC and G Handran KC,
with W LeMass, for the plaintiff
S Couper KC and D de Jersey KC for the defendant
SOLICITORS: McBride Legal for the plaintiff
RBG Lawyers for the defendant

Contents

INTRODUCTION ............................................................................................................................. 7
THE STRUCTURE OF THESE REASONS ....................................................................................... 14
FACT FINDING ............................................................................................................................... 15
CONTRACTUAL CONSTRUCTION ............................................................................................... 16

RELEVANT PRE-CONTRACTUAL CONDUCT ............................................................................... 18

THE DOCUMENTARY EVIDENCE .............................................................................................................................. 18
PIPE written presentations .................................................................................................................................... 18
Strategic Directions’ advice to SLC ..................................................................................................................... 20
The regulatory regime .......................................................................................................................................... 22
Further PIPE written presentations ....................................................................................................................... 25
PIPE power point presentations .............................................................................................................................27
Strategic Directions board recommendation .......................................................................................................... 29
PIPE’s business model .......................................................................................................................................... 31
The 21 July 2005 order form contract .................................................................................................................... 32
Negotiation of the IRU Agreement and the WFS Agreement ................................................................................... 35
THE ORAL EVIDENCE ............................................................................................................................................... 41
Mr Maha Sinnathamby was not called .................................................................................................................. 41
Ms Raynuha Sinnathamby. ................................................................................................................................. 42
Mr Bob Sharpless ................................................................................................................................................ 44
Mr Chris Schroor ................................................................................................................................................ 49

THE RELEVANT CONTRACTS ...................................................................................................... 52

THE IRU AGREEMENT ........................................................................................................................................... 52
PIPE’s construction, operation and maintenance obligations ................................................................................... 52
SLC’s payment obligations ................................................................................................................................... 55
On-Rail, Off-Rail, and the express allocation of ownership rights ............................................................................ 55
Regulatory matters. .............................................................................................................................................. 58
Other relevant terms ............................................................................................................................................. 61
THE WFS AGREEMENT .......................................................................................................................................... 64

THE PRE-CONTRACTUAL MISLEADING AND DECEPTIVE CONDUCT CASE ............................. 65

THE IMPUGNED CONDUCT ...................................................................................................................................... 65
THE CAUSATION HYPOTHESIS ................................................................................................................................. 67

CONCLUSION .......................................................................................................................................................... 69

CONSTRUCTION OF PHASE ONE AND PHASE TWO OF THE NETWORK .................................... 69

PHASE ONE ............................................................................................................................................................. 69
PHASE TWO AND RELOCATION OF THE SPRINGFIELD END OF PHASE ONE ............................................................. 70
THE LANDCORP INFRASTRUCTURE MUST BE REGARDED AS SUBJECT TO THE IRU AGREEMENT ........................... 75

THE CONSTRUCTION OF THE DUPLICATE NETWORK IN NOVEMBER 2009 ............................. 78

TIMING ................................................................................................................................................................... 78
OPTILINX DID THE WORK........................................................................................................................................ 78
PIPE GAVE NO INSTRUCTION TO SPLICE DUPLICATE NETWORK CABLE INTO OTHER CABLE .................................. 81

OTHER RELEVANT POST-CONTRACTUAL EVENTS ................................................................... 81

ARRANGEMENT FOR ACCESS TO THE POLARIS DATA CENTRE ................................................................................ 81
SLC BECOMES AWARE OF THE DUPLICATE NETWORK IN 2011 .............................................................................. 83
PIPE REFUSE TO NEGOTIATE THE TERMS OF AN EXTENDED TERM OF THE IRU AGREEMENT .............................. 89
SLC BUILDS ITS OWN NETWORK ............................................................................................................................. 89

THE POST-CONTRACTUAL MISLEADING AND DECEPTIVE CONDUCT .................................... 90

THE IMPUGNED CONDUCT ..................................................................................................................................... 90
THE CAUSATION HYPOTHESIS ................................................................................................................................ 90
CONCLUSION ........................................................................................................................................................... 91

THE BREACH OF CONTRACT CASE ............................................................................................. 91

INTRODUCTION ....................................................................................................................................................... 91
ALLEGED BREACH OF IMPLIED TERMS .................................................................................................................... 92
The alleged Non-Occupation Term. ...................................................................................................................... 92
The alleged Telco Notice Term ............................................................................................................................. 96
The alleged Non-Competition Term...................................................................................................................... 98
The alleged obligations founded on the implied duty to co-operate ............................................................................ 99

Conclusion ......................................................................................................................................................... 102
ALLEGED BREACH OF CONTRACTUAL TERMS ........................................................................................................ 102
Alleged breaches of clauses 3.4, 4.1(b) or 4.1(d) .................................................................................................... 102
Alleged breach of cl 5.1 of Schedule 3 .................................................................................................................... 103
Alleged breach of cl 10.2 of the IRU Agreement .................................................................................................... 103
Alleged breach of cl 13.1(d) of the IRU Agreement ................................................................................................. 104
Alleged breach of cl 15 ......................................................................................................................................... 105
CONCLUSION ......................................................................................................................................................... 109

THE CONVERSION AND TRESPASS CASE ...................................................................................109

THE PHYSICAL STATE OF THE NETWORK AND THE DUPLICATE NETWORK AS AT NOVEMBER 2009 ................... 109
As to the Network ............................................................................................................................................... 109
As to the Duplicate Network ............................................................................................................................... 110
SLC FAILED TO PROVE THE CRITICAL FACTUAL FOUNDATION OF ITS CASE .......................................................... 111
SLC DID NOT ESTABLISH RELEVANT RIGHTS TO THE LANDCORP INFRASTRUCTURE ........................................... 117

THE BREACH OF FIDUCIARY DUTY AND UNCONSCIONABLE CONDUCT CASE ...................... 118

THE ALLEGED FIDUCIARY DUTIES DID NOT EXIST ................................................................................................. 118
PIPE’S CONDUCT WAS NOT UNCONSCIONABLE .................................................................................................... 120

OTHER EQUITABLE CLAIMS ....................................................................................................... 122

BREACH OF DUTY OF CONFIDENCE ........................................................................................................................ 122
CLAIM BASED ON A CLAIM FOR EQUITABLE ESTOPPEL. .......................................................................................... 122

CLAIMS FOR BREACH OF STATUTORY DUTY ............................................................................ 122
CLAIMS FOR INJUNCTIVE RELIEF AND DECLARATORY RELIEF ............................................... 122
CLAIM FOR DECLARATORY RELIEF ............................................................................................ 123
CONCLUSION AND ORDERS ........................................................................................................ 123
APPENDIX 1 – RULINGS ON UNRESOLVED OBJECTIONS TO COURT BOOK .............................. 124
Introduction

The plaintiff (SLC[1]) is a private company which was at all material times the owner and developer of the urban area south-west of Brisbane known as Springfield.
[1] I use here the acronym for the plaintiff’s former name, which was the acronym used in relevant contractual instruments. I use the acronym rather than “Springfield” in order to avoid confusion with the use of the term as a location description.
Mr Maha Sinnathamby and his business associate, Mr Bob Sharpless, were in 2005, respectively, the chairman and the managing director of SLC.[2] In practice, ultimate decision-making for SLC rested with them, although Mr Sinnathamby’s opinion was the determinative one, as he controlled 75% of SLC’s shares to Mr Sharpless’ 25%.
[2] This description derives from the oral evidence of relevant witnesses. It conflicts in some respects with the company search, but I have preferred the evidence of the witnesses.

Prior to 2005, Mr Sinnathamby had formed the ambition that Springfield should develop as a technology hub along the lines of Silicon Valley in California. SLC engaged The Strategic Directions Group Pty Ltd (Strategic Directions), a company which conducted an ICT[3] consulting practice, to come up with an ICT masterplan. The development of a data centre for Springfield became a key part of the masterplan.
[3] Information and Communications Technology.
The defendant (PIPE[4]) was at all material times a private company which held a telecommunications carrier licence issued pursuant to Part 3 of the Telecommunications Act 1997 (Cth) and whose business involved, amongst other things, providing installation and maintenance services concerned with telecommunications infrastructure, fibre optic networks, and internet exchange products and services.
[4] This short form of the defendant’s name was the form used to refer to the defendant in relevant contractual instruments.
In December 2004, PIPE provided a proposal to Strategic Directions for discussion purposes to determine how PIPE and SLC could work together with a view to building a data centre for the Springfield CBD. Amongst other things, the proposal suggested that the data centre be connected to the Brisbane CBD via a fibre optic cable network.
Before continuing, it is appropriate to interpolate some technological background. A data centre is a place used to house the infrastructure needed to service modern business computing requirements. Typically, a data centre provides a secure temperature-controlled and humidity-controlled environment capable of housing multiple computer servers, which in turn service external clients. There is a need for reliable and competitive telecommunication connectivity between the data centre and the external clients. Fibre optic cabling is an efficient means of providing such connectivity.
Fibre optic or “dark fibre” cabling is comprised of multiple individual strands of glass fibre “cores”. Each individual core provides the transmission medium for data in the form of light encoded with digital information. Each core is comprised of a single glass fibre, cladding to contain the light, and a protective coating. A fibre optic cable is comprised of multiple individual fibres or cores, typically grouped in multiples of 12 within tubing, which tubed groups are then contained within a sheath. Thus, a single fibre optic cable might contain 72, 144, or 216 cores within a single sheath, and would be referred to as a 72f, 144f, or 216f cable. Larger numbers of fibres were possible. In 2005, technology existed which could drive the transmission of data over distances in excess of 70km, at speeds in excess of 40 gigabits/second per fibre pair, a pair being one fibre strand or core used for transmission, and another used for reception.
A typical example of a fibre optic cable is shown in the figure below:
Optic fibre cables can be installed overhead, in cable trays, or underground. Underground installation is common in urban and semi-urban areas and typically involves installation of cabling within PVC conduit placed within trenches, which are then backfilled. Depending on the diameter of the conduit and of the cabling, multiple cables can be installed or “hauled” through a single conduit. Cable can also be installed using “subduct”, namely by being installed within a conduit of a smaller diameter than the principal conduit, and which, like a long hose, can be hauled through the larger conduit.
PIPE’s proposal to construct a data centre did not proceed and the “Polaris Data Centre”, as it came to be known, was constructed by others. However, by an agreement dated 7 November 2005 (the IRU Agreement), SLC and PIPE entered into a contract pursuant to which SLC agreed to finance the construction by PIPE of a fibre optic cable network between Springfield and Brisbane. The IRU Agreement was a long-term contract the evident goal of which was that SLC would obtain a guaranteed ability to use a 72-core fibre optic capacity in a fibre optic cabling network between Springfield and the Brisbane CBD for at least 15 years, but possibly as long as 30 years. There was also a related Wholesale Fibre Service Agreement (the WFS Agreement) bearing the same date.
PIPE constructed, operated and maintained the network which was the subject of the IRU Agreement (the Network). That network was comprised of a western and an eastern path, each connecting the Brisbane CBD with the Springfield CBD. The western path was constructed first and connected to the part of the University of Southern Queensland (USQ) campus at Springfield known as the World Knowledge Centre by about February 2006. The eastern path was constructed later and connected to the Polaris Data Centre at Springfield by about December 2007. The western path was relocated, via an alternate route within the Springfield CBD, to be connected to the Polaris Data Centre by about 2008.
The genesis of this proceeding was that in November 2009, and without informing SLC or seeking its consent, PIPE installed its own 216f cable in some of the pits and PVC conduits in which the Network had been accommodated. It is convenient – albeit inaccurate (see [261] below) – to refer to the new network as the Duplicate Network. SLC says that since installation PIPE has been utilising the Duplicate Network to sell fibre optic capacity to the Springfield area, in competition with SLC’s ability to sell capacity on the Network. SLC’s case is that PIPE was not entitled to use the Network’s infrastructure to accommodate a competing network (at least during the life of the IRU Agreement).
The first of the many problems facing SLC is that it is conceptually wrong to think of the Network as SLC’s network or of the infrastructure used by PIPE as SLC’s infrastructure. Part of the Network (known as the “On-Rail” part) was accommodated in infrastructure on land owned by Queensland Rail. In that part of the Network, SLC did not even own the relevant fibre optic cable let alone the infrastructure, but had contracted only for a guaranteed right to use fibre optic capacity in cable which was owned by someone else. And in the other part of the Network (known as the “Off-Rail” part) although SLC owned the cable (or at least part of the cable[5]), the cable itself was accommodated in infrastructure (including all pits and conduits) which SLC had specifically agreed would be owned by PIPE. Indeed, subject to those provisions, SLC had agreed that PIPE retained all other rights of ownership in the Network “to the fullest extent permitted by law”. The evidence reveals that the infrastructure which PIPE used for the Duplicate Network was infrastructure which SLC had agreed that PIPE owned.
[5] In large parts of the Off-Rail part of the Network, SLC’s 72f cable was part of an existing shared cable of 144f where 72f were allocated to SLC, but ownership of the remaining 72f was retained by PIPE.
The final as-built route of the Network and of the Duplicate Network can be understood by reference to two summary drawings prepared by SLC’s expert Mr Lordan, which are reproduced in the following two pages (place names added).
The first drawing (labelled “Springfield Network – Cable and Joints”) shows the as-built route of:

(a) Shared cable, which, so far as the On-Rail section was concerned, was not owned by SLC in any respect, but in respect of which SLC had a right to use fibre optic capacity. In the west shared cable ran from Brisbane to Goodna and in the east from Brisbane to Hill Crest.
(b) Springfield cable, which was owned by SLC. In the west the Springfield cable ran from Goodna initially to the World Knowledge Centre at USQ, but, after relocation, to the Polaris Data Centre, both locations being in Springfield. In the east it ran from Hill Crest to the Polaris Data Centre.
(c) Duplicate Network cable, which was the 216f cable installed in November 2009 and owned by PIPE. It followed only the route of the Springfield cable from Goodna to the Polaris Data Centre and from Hill Crest to the Polaris Data Centre.

The second drawing (labelled “Springfield Network – Routes / Conduit”) shows the infrastructure utilised by:

(a)

Shared cable, namely cable laid in infrastructure not owned by SLC. In the west from Brisbane to Goodna it was laid in Queensland Rail conduit and trays, and in the east from Brisbane to Hill Crest it was laid in Telstra lease conduit.

(b)

Springfield cable, namely cable laid in 50mm conduit, marked on the drawing as P50 conduit. This was infrastructure which the IRU Agreement said was owned by PIPE. In the west that occurred from Goodna initially to the World Knowledge Centre. After relocation, the cable was laid into the Polaris Data Centre via the Landcorp 100mm conduit. It will be necessary to return to the question of the ownership of the Landcorp conduit, as it was a matter of some controversy in respect of which the evidence was poor. In the east the cable from Hill Crest to the Polaris Data Centre was laid via the Landcorp 100mm conduit.

(c)

Duplicate Network cable, which was laid in the same 50mm PIPE conduit and the same 100mm Landcorp conduit as was the Springfield cable.

Brisbane

Springfield

Brisbane

Springfield

For completeness, I should say that I have set out the above drawings for the limited purposes I have identified, namely general route depiction and identifying the fact of shared cable, SLC cable, and Duplicate Network cable. The accuracy of the identification of relevant joint/splice numbers and of the minutiae of the enlarged inset drawings is not relevant to those purposes and I do not mean to convey that I have accepted it.
SLC’s answer to the issues created by the express terms concerning ownership of the infrastructure was to suggest that, nevertheless, PIPE must be regarded as contractually constrained against constructing and operating a competing Duplicate Network without SLC’s consent either as a matter of the proper construction of the contract concerned or by the implication of relevant terms. For reasons which follow, both aspects of that case must fail. The parties contracted to allocate ownership rights in the way they did in the context of a complex statutory telecommunications regulatory regime and their intention, both objectively assessed and in fact, was to bring about a position in which they felt it was likely that the burden of compliance with that regime would fall on PIPE rather than on SLC and that their agreement concerning ownership would assist them in achieving that goal. Real effect should be given to the allocation of ownership rights, especially when the parties agreed that PIPE’s ownership rights would be held by PIPE “to the fullest extent permitted by law”. There is no reason either on the proper construction of the contracts or by implication of terms to bring about a position in which PIPE’s ability to take commercial advantage of its ownership rights was constrained in the way for which SLC contended.
SLC contended that in the events leading up to, and by the parties’ entry into, the IRU Agreement and the related WFS Agreement, PIPE (in a manner apt to mislead) expressly, implicitly or by its silence conveyed to SLC that PIPE:

(a) would provide SLC with the only network infrastructure capable of supporting Springfield’s telecommunications requirements during the term of the IRU Agreement;
(b) did not intend to, and would not, compete with SLC to supply optic fibre capacity to wholesale suppliers and retail customers of telecommunications services between Brisbane and Springfield;
(c) would not solicit or attempt to solicit any customer, or potential customer, of the Network; and
(d) would not do anything to detract from, and in fact would work to maximise, SLC’s revenue earning capacity by the provision of telecommunications services to the Springfield area,
and that such representations induced SLC to enter into the contracts and constituted
actionable misleading and deceptive conduct.

That misleading and deceptive conduct case was completely artificial: the representations were not made, and, even if one could reach the conclusion that they were, it is plain that SLC did not rely upon them. As to the latter aspect, SLC and PIPE were both sophisticated commercial actors. Further, and as has been mentioned, SLC had retained its own independent ICT consultants to advise it. They did so, including by evaluating PIPE’s proposals. Moreover, the evidence was that SLC normally required legal signoff before formally executing contracts. And it plainly did so for this transaction. To that end, SLC had its own in-house legal counsel team and it also retained Mallesons Stephen Jaques as its solicitors. For its part, PIPE retained Minter Ellison. The contracts were negotiated at arms- length between SLC and PIPE where each was assisted by its own external (and, at least in the case of SLC, internal) legal advisers.
Further, SLC contended that, despite the terms of the IRU Agreement, as between SLC and PIPE, SLC should be taken to own the Landcorp 100mm conduit and related infrastructure. It says that PIPE must have committed a trespass actionable by SLC when PIPE laid the Duplicate Network cable in that infrastructure. For reasons which follow, that case fails because, as between themselves, SLC and PIPE had agreed that PIPE would own the infrastructure for that section of the Network and that agreement extended to encompass the Landcorp infrastructure. Further, and in any event, SLC did not establish that it had such rights in relation to the Landcorp infrastructure as would support a trespass case.
Alternatively, SLC contended that in constructing and operating the Duplicate Network, without its consent, PIPE had breached fiduciary duties which it owed to SLC and also contravened statutory unconscionable and misleading conduct provisions. It also complained that in the course of laying the cable into the Polaris Data Centre, PIPE engaged in further acts of misleading and deceptive conduct which had the result that SLC had not realised that the Duplicate Network was being laid, with the result that it lost the opportunity of preventing the connection of the Duplicate Network into the Polaris Data Centre. For reasons which follow, each of those cases fails on the facts. PIPE did not owe SLC the alleged fiduciary duties and PIPE’s conduct was not unconscionable.
SLC said, further, that I should infer from various documents that at some places over the length of the Duplicate Network independent contractors on PIPE’s behalf had spliced into particular fibres on the cable which must be regarded as SLC’s fibres. SLC contended that, on any view, PIPE was not entitled to splice into those fibres and that the splicing constituted a trespass. It says that, having spliced into SLC’s fibres, PIPE then tortiously converted relevant fibres by using them. In order to prove the trespass SLC needed to prove that PIPE instructed some relevant contractor to splice into SLC’s fibres. SLC never explained why PIPE would have wanted to do that. Indeed an experienced contractor gave evidence before me and found it difficult to imagine why an instruction would be given which would involve splicing new cable into an existing operative network. But, putting the question of motivation to one side, SLC’s case depended on identifying the particular fibres which, one way or another, could be regarded as SLC’s fibres and not PIPE’s fibres, where both existed in essentially the same physical location and then proving that an instruction was given to splice into those fibres. The conversion case also depended on proving that the particular fibres which PIPE used were fibres which must be regarded as SLC’s fibres. For reasons which follow, I am not persuaded to infer the truth of the requisite foundational factual proposition. This case, too, fails on the facts.
SLC claimed:

(a)

damages for alleged breach of contract, breach of statutory duty and trespass or conversion;

(b)

an account of profits or equitable compensation for breach of alleged obligations of good faith, alleged fiduciary duties or based on a claim for equitable estoppel;

(c)

damages pursuant to s 236 of the Australian Consumer Law or s 82 of the Trade Practices Act for alleged misleading conduct or compensation pursuant to s 237 of the Australian Consumer Law or s 87 Trade Practices Act for alleged unconscionable conduct;
(d) an injunction restraining PIPE during the term of the IRU Agreement from:
(i) being engaged concerned or interested in any business or undertaking as a telecommunications asset owner offering competitive fibre cable capacity to wholesale suppliers or end-users of telecommunication services in Springfield; and
(ii) from using any infrastructure relating to the Off-Rail section of the Network, including any cable situated therein comprising the Duplicate Network;

(e) an order that PIPE remove the Duplicate Network and an injunction permanently restraining PIPE from obstructing SLC from removing those parts of the Duplicate Network that are in conduits owned by SLC;
(f) a declaration that, on the proper construction of the IRU Agreement and the WFS Agreement, the term of the IRU Agreement may be extended under clause 13.l(c) by either party unilaterally;
(g) an injunction restraining PIPE from interfering with, or removing, any of the customers on SLC’s Network, other than on the instructions of SLC, for the remaining duration of the IRU Agreement;
(h) interest pursuant to the Civil Proceedings Act 2011; and
(i) costs.

For its part, PIPE contended that SLC could not make good any of its claims.
I agree.

The structure of these reasons

I organise these reasons, first, by identifying the approach I will take to fact finding and to contractual construction, second, and in roughly chronological order, by identifying the facts which I have found, and, finally, by addressing the various claims advanced by SLC under appropriate headings.
In this regard I should note that I received about 564 pages of written opening and closing submissions. The closing oral addresses occupied 210 pages of transcript. I will not seek to recapitulate and then specifically address every argument advanced in that wealth of submissions. Rather, in these reasons I will seek to address all the matters I have regarded to be of relative significance to the resolution of the determinative issues concerning the various causes of action which SLC has sought to pursue against PIPE and which I have identified in that material.
I have not sought to address a multiplicity of issues relating to quantum or to the expert evidence adduced on that subject. That was not because quantum was not in issue at the trial. The contrary was the case. The trial had to be adjourned part-heard because of issues which arose in relation to the expert opinion evidence on quantum: see Springfield City Group Pty Ltd v Pipe Networks Pty Ltd [2020] QSC 395. It did not reconvene until about nine months later. The quantum case was riddled with complexity. Indeed, SLC’s own closing submissions suggested that unless my findings favoured all the inputs which their expert had put into his financial model, I should deliver reasons without calculation of loss and instead direct the parties to attempt to agree final orders to reflect my reasons and, failing agreement, I should provide the parties further opportunity to be heard.
I have not addressed quantum because, as I have already mentioned and for reasons which I will come to, in my judgment SLC cannot make good any cause of action entitling it to recover any pecuniary compensation from PIPE. And although I acknowledge that it is often, perhaps even usually, appropriate for a trial judge who has found against a claimant to make findings on the measure of damages or other pecuniary relief sought by the claimant in case he or she is found to be wrong on liability by an appellate court, I have formed the view that in this case it is not.

In this case such an examination would necessarily require me to measure pecuniary relief by accepting as true factual hypotheses which I have found are false or not supported by the evidence and then, on such false foundations, to go forward to make further assumptions and calculations and findings, and perhaps even to operate a complex financial model which has been prepared by SLC’s expert. Given the complexity of the various causes of action in this case and the permutations which that might involve, by which combination of what I would regard to be false assumptions would I proceed? The reason I have not addressed quantum is that so to proceed seems to me to be wrong and grossly inefficient.

Fact finding

In what follows, I have sought to apply the following principles.
In a civil case, proof of a fact in issue requires proof which enables a judge to be positively satisfied of the affirmative of the issue. In determining whether the judge is positively satisfied, the judge is at liberty to be satisfied upon a balance of probabilities. But the judge does not merely balance probabilities and say which way they incline. Rather, the judge must be affirmatively persuaded, having regard to the balance of probabilities, that the fact occurred.[6]
[6] Murray v Murray (1960) 33 ALJR 521 at 524 per Dixon CJ, cited with approval by Gageler J in Henderson v Queensland (2014) 255 CLR 1 at [87].
The requisite state of positive satisfaction may be obtained by the judge accepting evidence which directly proves the fact in issue. But it may also be reached by inference from other circumstances which have been proved, if those circumstances give rise to a reasonable and definite inference and not merely to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture.[7]
[7] Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5 per Dixon, Williams, Webb, Fullagar and Kitto JJ, also cited with approval by Gageler J in Henderson v Queensland at [88].
In Re Day,[8] Gordon J recently restated these principles in this passage (footnotes omitted):
[8] Re Day (2017) 91 ALJR 262 at [18].
The tribunal must feel an actual persuasion of the occurrence or existence of a fact before it can be found. Where direct proof is not available and satisfaction of the civil standard depends on inference, “there must be something more than mere conjecture, guesswork or surmise” – there must be more than “conflicting inferences of equal degrees of probability so that the choice between them is [a] mere matter of conjecture”. An inference will be no more than conjecture unless some fact is found which positively suggests, or provides a reason in the circumstances particular to the case, that a specific event happened or a specific state of affairs existed.
Generally speaking, these principles apply equally where the issue is proof of a single event as they do where the issue is proof of the existence of a state of affairs, or of the non- happening of an event or of the non-existence of a particular state of affairs.[9]
[9] Henderson v Queensland at [89] and [91] per Gageler J.

Contractual construction

I will shortly turn to an examination of the pre-contractual conduct. The principal relevance of that examination is to SLC’s pursuit of extra-contractual remedies.
However, in light of the fact I would conclude that some of the terms of the IRU Agreement and the WFS Agreement are ambiguous, the pre-contractual conduct may be a source from which may be found relevant evidence of events, circumstances and things external to the agreements which were known to the parties, or which assist in identifying the purpose or object of the transaction. Of course, that is not to say that everything which I identify in my discussion of pre-contractual conduct will be relevant or admissible in that sense. In this regard, the approach I will take to contractual construction is that which I summarised in Wagners Cement Pty Ltd v Boral Resources (Qld) Pty Ltd [2020] QSC 124 at [36] to [40]:[10]
[10]           Footnotes in original, but footnote numbers altered.
For present purposes, the principles of construction of commercial contracts were sufficiently identified by French CJ, Nettle and Gordon JJ in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd[11] and subsequently approved in Victoria v Tatts Group Ltd:[12]
[11]            Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 per French CJ, Nettle and Gordon JJ at [46] to [51], internal citations omitted.
[12]            Victoria v Tatts Group Ltd (2016) 90 ALJR 392 per French CJ, Kiefel, Bell, Keane and Gordon JJ at [51].
[46] The rights and liabilities of parties under a provision of a contract are determined objectively, by reference to its text, context (the entire text of the contract as well as any contract, document or statutory provision referred to in the text of the contract) and purpose. [47] In determining the meaning of the terms of a commercial contract, it is necessary to ask what a reasonable businessperson would have understood those terms to mean. That inquiry will require consideration of the language used by the parties in the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract.
[48] Ordinarily, this process of construction is possible by reference to the contract alone. Indeed, if an expression in a contract is unambiguous or susceptible of only one meaning, evidence of surrounding circumstances (events, circumstances and things external to the contract) cannot be adduced to contradict its plain meaning.
[49] However, sometimes, recourse to events, circumstances and things external to the contract is necessary. It may be necessary in identifying the commercial purpose or objects of the contract where that task is facilitated by an understanding “of the genesis of the transaction, the background, the context [and] the market in which the parties are operating”. It may be necessary in determining the proper construction where there is a constructional choice. The question whether events, circumstances and things external to the contract may be resorted to, in order to identify the existence of a constructional choice, does not arise in these appeals.
[50] Each of the events, circumstances and things external to the contract to which recourse may be had is objective. What may be referred to are events, circumstances and things external to the contract which are known to the parties or which assist in identifying the purpose or object of the transaction, which may include its history, background and context and the market in which the parties were operating. What is inadmissible is evidence of the parties’ statements and actions reflecting their actual intentions and expectations.
[51] Other principles are relevant in the construction of commercial contracts. Unless a contrary intention is indicated in the contract, a court is entitled to approach the task of giving a commercial contract an interpretation on the assumption “that the parties ... intended to produce a commercial result”. Put another way, a commercial contract should be construed so as to avoid it “making commercial nonsense or working commercial inconvenience”.
…
… the issues which have arisen between the parties and which I examine under separate headings below
all address matters on which the terms of the Agreement itself are relevantly ambiguous. The result of
the application of the above principles is that, in order to determine the proper construction of the
Agreement, recourse may be had to:

(a) the text of the terms, the meaning of which is disputed;

(b)

the internal context within which that text occurred, namely the entire text of the Agreement as well as the particular documents referred to in the text of the Agreement; and

(c)

evidence of events, circumstances and things external to the Agreement which were known to the parties or which assist in identifying the purpose or object of the transaction.
… contractual negotiations, which was not capable of being used in the manner contemplated by the last category] was admissible in aid of construction. The Supplier’s proposition was that the law had moved on and now permitted an examination of the communicated negotiating position of parties from time to time in relation to a particular contractual term, because the communicated negotiating position should itself be regarded as a “fact” known to both parties, which might then tend to show the purpose or object of the clause (in the sense of the “mischief” to which it was directed) and therefore be admissible in aid of construction. It is true that there are statements in the New South Wales Court of Appeal in Cherry v Steele-Park (2017) 96 NSWLR 548 at [91] to [92] and in Commonwealth Steel Company Ltd v BHP Billiton Marine and General Insurance Ltd [2018] NSWCA 242 at [34] to [35] which lend support to the Supplier’s proposition. However, to my mind the Supplier’s proposition is inconsistent with High Court authority and plainly wrong: see Heydon on Contract at [9.50], [9.660], [9.1360] and [9.1410] and the cases there cited. The orthodox view of the law, consistent with High Court authority, is that which was expressed by the Queensland Court of Appeal in Velvet Glove Holdings Pty Ltd v Mount Isa Mines Ltd [2011] QCA 312 per Philippides J (with whom Fraser and White JJA agreed) at [93] to [103] and in Watson v Scott [2016] 2 Qd R 484 per McMurdo P (with whom Morrison and Philippides JJA agreed) at [30]. The law as stated in those cases would exclude the contested evidence, “drenched in subjectivity”[13] as it was, on the grounds that it was irrelevant. The law as stated in Velvet Glove Holdings Pty Ltd v Mount Isa Mines Ltd and in Watson v Scott is the law which I have applied.
[13] The phrase used by Lord Hoffmann in Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101 at [38] is as apposite here as it was when adopted by Spigelman CJ in Phoenix Commercial Enterprises Pty Ltd v City of Canada Bay Council [2010] NSWCA 64 at [30].

It will appear that it is necessary to construe the significance of some clauses which appear in the form of express exclusions. It is worth emphasising that the approach to be taken to construing such clauses is no different to the approach to be taken to construing any other clause in a commercial contract. As the High Court observed in Darlington Futures Ltd v Delco Australia Pty Ltd (1986) 161 CLR 500 at 510-11 (emphasis added):
These decisions clearly establish that the interpretation of an exclusion clause is to be determined by construing the clause according to its natural and ordinary meaning, read in the light of the contract as a whole, thereby giving due weight to the context in which the clause appears including the nature and object of the contract, and, where appropriate, construing the clause contra proferentem in case of ambiguity. Notwithstanding the comments of Lord Fraser in Ailsa Craig [[1983 1 W.L.R. at 970; [1983] 1 All E.R. at 105], the same principle applies to the construction of limitation clauses. As King C.J. noted in his judgment in the Supreme Court, a limitation clause may be so severe in its operation as to make its effect virtually indistinguishable from that of an exclusion clause. And the principle, in the form in which we have expressed it, does no more than express the general approach to the interpretation of contracts and it is of sufficient generality to accommodate the different considerations that may arise in the interpretation of a wide variety of exclusion and limitation clauses in formal commercial contracts between business people where no question of the reasonableness or fairness of the clause arises.

Relevant pre-contractual conduct

I will examine first the documentary evidence, which was expressed in the Court Book. I will then move on to consider the oral evidence adduced before me.
References in these reasons to the “Court Book” are to those parts of the Court Book which were admitted to evidence. Relevant parts were contained in exhibits 1, 2, 3, 8, 9, 12, and 13. Some objections to admissibility were taken to some parts of the Court Book and not resolved during the trial. Helpfully, during its closing submissions SLC provided to me a document entitled “plaintiff’s response to defendant’s documentary objections”. A schedule to the document identified:

(a) documents to which objection had been taken, but in respect of which SLC no longer pressed for inclusion in the Court Book; and
(b) documents to which objection had been taken, and which SLC continued to press for inclusion and in respect of which SLC required my ruling.

I rule on the documents in the latter category in Appendix 1 to these reasons.

The documentary evidence

So far as the documentary evidence revealed, the first relevant contact between SLC and PIPE occurred on about 7 December 2004 when PIPE provided the discussion proposal referred to at [5] above. That proposal was a 6-page confidential written presentation entitled “Proposal for Data Centre initiative in Springfield CBD”. It suggested a joint venture between SLC and PIPE aimed at building, by the end of 2006, a data centre in Springfield to satisfy the demand from Brisbane City, Springfield and possibly Ipswich for data centre services. Part of that proposal involved the idea that the data centre would be connected to the Brisbane CBD via a fibre optic network ring “to allow for diverse fibre connections”.

PIPE written presentations

[44] In about mid-February 2005, PIPE provided a further 6-page confidential written presentation to Strategic Directions entitled “PIPE Networks Proposal to Strategic Directions for a Fibre Optic Network between Brisbane CBD and the Springfield CBD”. The scope of the proposal had narrowed somewhat and no longer included provision for the construction of a data centre. The opening paragraph provided:
PIPE Networks will build a large core count fibre optic network between Brisbane CBD and Springfield CBD (as planned). The aim of this build is to bring competitive telecommunications services to Springfield CBD as is available in Brisbane CBD. This will allow businesses to easily move their operations to Springfield without communications costs being a barrier.

The details of the proposal were as follows:

(a)

The network would be constructed as a 79km network “ring” comprising a western and an eastern leg, with each leg comprising 72 fibre cores. The route would have On- Rail and Off-Rail components. All On-Rail fibre would be subducted to increase protection. Part of the eastern leg would be subducted within existing Telstra ducting. PIPE proposed to provide a 99.999% “uptime” guarantee on the cable operation.
(b) SLC could use the network for any legal activity, including:
(i)       allocation to telecommunications carriers who might wish to set up a point of presence at Springfield without the burden of the build;
(ii)      allocation to a customer for their dedicated communications requirements back to the Brisbane CBD, possibly being bundled in with a lease or other long-term agreement; and
(iii)     bundling with any future data centre operation.

(c) There would be “Network Access Points” at either end of the cable, which points would allow customers to connect to either end of the cable in order to send and receive data traffic. These would also be the points where other telecommunications carriers could deliver services from Brisbane to Springfield. In Springfield these points would be any future data centre and some outside plant assets such as pits. In Brisbane these points could be either one or two pits of choice and/or one or two data centres of choice.
(d) PIPE proposed to undertake to provide users of the cable access to its “Wholesale/Carrier rates” for connection from CBD buildings to the Network Access Points.
(e) PIPE’s responsibilities would include:

(i) the initial build of the network;
(ii) physical maintenance of the network;
(iii) telecommunications carrier and regulatory issues regarding the cable; and
(iv) responding to work orders from SLC in relation to the connection or disconnection of customers and testing for any reported faults.
(f) PIPE proposed a price of $6,350,000 excluding GST for building the network and for its ongoing use and maintenance for 15 years.

Within a few days, PIPE developed that 6-page presentation into a 12-page presentation. A draft document was provided to Strategic Directions on 17 February 2005 and a final document emailed on 18 February 2005. Changes and additions to the 6-page proposal included:

(a) The addition to the opening paragraph quoted at [44] above of the following:
This proposal will allow for the customers to use the fibre for communications between Springfield and Brisbane. It will allow Springfield Land Corporation (SLC) to have access to a tangible and valuable piece of infrastructure that will enhance the great CBD offering that is Springfield.
It will not require SLC to:

• become a carrier or deal with any carrier related issues,
• deal with end users of fibre services between Springfield and Brisbane[.]

(b)

The provision of cost information concerning existing high-speed data transmission to Springfield via Optus or Telstra.
(c) Explanation of the recommendation for a 72-core count network.

(d)

The provision of further detail concerning the route description by a diagram showing the eastern leg of the route described as “City to Springfield via Sydney-Brisbane Rail Line” and the western leg of the route described as “City to Springfield via Ipswich- Brisbane Rail Line”. Further detail was then set out, including that parts of the eastern leg of the route would be subducted in Telstra underground duct; part subducted in Queensland Rail concrete troughs; part in 100mm conduit beside the railway; and part in 50mm conduit. Part of the western leg would be subducted in Queensland Rail concrete troughs and part would be in 50mm conduit.

(e)

The statement that fibre cable has a stated life of 15 years. The statement that the life of the asset would be 20 to 30 years, excluding cable life, and the provision of a conditional quote to re-haul the network as an end-of-life upgrade.

(f)

The provision of comparative pricing for network build and maintenance as between a 72-core network and a 144-core network. The quote for the former was reduced slightly to $6,323,000. The quote for the latter was $7,239,000.

PIPE’s email also provided a simple single sheet financial “model” which had been “put together that we can utilise to simulate different costings, number of circuits sold, etc - and which will help us to understand the payback period for SLC”. On the basis of certain stated assumptions, the model suggested that:

(a)

if SLC could sell the capacity of about 21% of available fibre pairs, it could earn annual recurring revenue sufficient to enable it to payback its initial investment in a little over three years; and

(b)

the proposal could enable SLC to offer transmission capacity to its customers which would offer savings when compared to the price of comparable offerings by Telstra.

Strategic Directions’ advice to SLC

On 21 February 2005, Strategic Directions’ Mr Andrea emailed the proposal to SLC’s Mr Schroor, copied (amongst other people) to SLC’s Mr Sharpless. He sought a meeting to discuss the proposal in more detail, but summarised it in these terms:
This proposal is effectively a guarantee that the fibre will be built based on Springfield’s investment, and provides the following

- 15 year irrefutable right of use by SLC

o The means SLC can bundle fibre connectivity into leasing arrangements if
required
o By treating this as an investment, SLC can make a solid return in the medium
to long term

- The ability to guarantee fibre connectivity in the SLC submission to Qld Govt Dept of
Public Works
- The ability to market the capability around the Data Centre publicity statements
- 15 years maintenance and support of the links
- Carrier independency as SLC can provide fibre connectivity to any carrier as needed
(possibly at wholesale rates as part of the ROI model)[.]

On 3 March 2005, Strategic Directions provided to SLC a 15-page written “Project Report” on “Springfield CBD to Brisbane CBD Fibre Connectivity Options”. The following observations may be made.
In the first section of the report, Strategic Directions recorded the nature of its retainer and the task sought to be performed by the report in these terms:
Springfield Land Corporation (SLC) engaged The Strategic Directions Group Pty Ltd (Strategic Directions) to review a range of IT and telecommunications components relating to Springfield's planned Gateway CBD development.
As part of the overall business solution regarding implementation of a new purpose built Data Centre, dual path (redundant) fibre optic connectivity is required between Springfield CBD and Brisbane CBD.
Strategic Directions has held discussions on the available options to achieve the required fibre connectivity with Telstra, Optus, PIPE Networks and SPTel. PIPE Networks was the only carrier who has subsequently provided a costed proposal for Springfield's consideration, which is reviewed in Section 3.
This document reports the outcomes of the discussions and subsequent options on how to progress
Springfield's fibre connectivity needs.
In the second section of the report, Strategic Directions advised that having a data centre was 100% dependent on having fibre connectivity to Brisbane and/or the rest of Australia. Further, it advised that no significant potential customer of a data centre would commit to a data centre that was not connected to multiple carriers over fibre, but also that no carriers (including Telstra, Optus, SPTel (with Nexgen) and PIPE) would commit to spend their own money building a connection without a committed customer spend. This “chicken and egg” scenario was a justification for Springfield taking the step of investing in fibre infrastructure itself, if it wanted a data centre. Such a spend would be regarded as a significant component in making the Springfield CBD a business location of the future. Strategic Directions stated that one thing which set such an investment apart from investment on roads, bridges, subdivisions and other infrastructure was the ability of providing a recurring revenue stream.
The third section of the report canvassed a number of potential options available to SLC to provide or obtain dual path connectivity to a data centre. It concluded that acceptance of the PIPE proposal would set up the ability to influence cost effective connectivity for CBD customers. Amongst other things, Strategic Directions advised:
PIPE Networks is the only provider to deliver a firm quote to SLC during discussions with the market. The quote is based on a construction-phase study and associated pricing by NDC and Queensland Rail. Summary of the PIPE Networks proposal:

• SLC underwrite both legs of an optic fibre installation (72-core cables) – capital for the installed cable runs of $4.621 m exGST
• PIPE Networks manage and maintain the fibre infrastructure, including all regulatory issues for 15 years, paid up-front ($1.702m) or annually ($115k)
• PIPE owns the cable, however, SLC takes a 15 year IRU over both legs of the cable
• Total capital contribution for cable installation and 15 years maintenance $6.323m exGST
• Options were provided to only install one of the legs, and pricing to increase the core count to 144-core cable
• The quote is valid for 90 days
PIPE have also indicated they are prepared to structure the agreement around an NCD in lieu of an IRU, with SLC owning the cable, and PIPE managing and maintaining as noted above. On the face of it, there is no immediate financial benefit, other than a more flexible Exit Strategy on potential sale of the infrastructure.

The comment concerning exit strategy was elaborated later in the section in these terms:
Exit Strategy
Discussions with PIPE Networks demonstrate some flexibility in possible Exit Strategies including:

• Buy-back / buy-out and the end of the contract term

•

Use of Commercial (revenue) Triggers during the contract term for PIPE to buy the infrastructure off SLC
• Basis is currently a pay-back within 36 months

•

Ability under an NCD (where SLC owns the infrastructure) for other carriers to bid/purchase the infrastructure at any time[.]

Strategic Directions defined NCD in these terms:
Nominated Carrier Declaration – an NCD is a formal declaration to the Australian Communications Authority (ACA) that a carrier is managing and maintaining telecommunications infrastructure on behalf of a third-party in accordance with their Telecommunications Carrier Licence.
This would allow Springfield to use the fibre cores in any way they see fit, while retaining ownership of the fibre infrastructure.
Although the question of ownership of the telecommunications infrastructure involved in the PIPE proposal was not made explicit in the terms of the written PIPE proposals to this time, I infer from the foregoing that there must have been other communications between Strategic Directions and PIPE at least concerning ownership of the infrastructure. Strategic Directions’ advice to SLC treated the PIPE proposal as involving PIPE ownership of cable with PIPE guaranteeing SLC an “Irrefutable” or “Indisputable” right of use or IRU of defined capacity over a particular period. However, Strategic Directions also recorded that PIPE had conveyed its willingness to consider another model, in which PIPE would make a “Nominated Carrier Declaration” or NCD to the regulator that it as a carrier was managing and maintaining telecommunications infrastructure on behalf of SLC, which would allow SLC to own the cable. The terms of the report suggested that, at this time, Strategic Directions were treating the terms “cable” and “infrastructure” as interchangeable.

The regulatory regime

It is necessary at this juncture to interpolate a brief explanation about the then applicable regulatory regime and its perceived significance to the relationship between SLC and PIPE and, in particular, to the question of ownership of cable and infrastructure.
The regulatory regime was that prescribed by the Telecommunications Act 1997 (Cth) and related statutes. Section 5 of the Telecommunications Act sets out a simplified outline of the Act in the following terms (emphasis in original):[14]
[14] I quote from the compilation of the Act prepared on 21 October 2005, taking into account amendments up to Act No. 119 of 2005, as that version was the version in force at the time the IRU Agreement was executed.

• This Act sets up a system for regulating telecommunications.
• The main entities regulated by this Act are carriers and service providers.
• A carrier is the holder of a carrier licence granted under this Act.

•

The owner of a network unit that is used to supply carriage services to the public must hold a carrier licence unless responsibility for the unit is transferred from the owner to a carrier.
• There are 4 types of network unit:

(a)

a single line link connecting distinct places in Australia, where the line link meets certain minimum distance requirements;

(b)

multiple line links connecting distinct places in Australia, where the line links meet certain minimum distance requirements;
(c) a designated radiocommunications facility;
(d) a facility specified in a Ministerial determination.
• Carrier licences are subject to conditions.
• There are 2 types of service provider:

(a) a carriage service provider;
(b) a content service provider.

•

A carriage service provider is a person who supplies, or proposes to supply, certain carriage services.

•

A content service provider is a person who supplies, or proposes to supply, certain content services.
• Service providers must comply with the service provider rules.

•

The Australian Communications and Media Authority (ACMA) is to monitor, and report each year to the Minister on, significant matters relating to the performance of carriers and carriage service providers.

•

Bodies and associations that represent sections of the telecommunications industry or the e- marketing industry may develop industry codes.
• Industry codes may be registered by the ACMA.

•

Compliance with an industry code is voluntary unless the ACMA directs a particular participant in the telecommunications industry or the e-marketing industry to comply with the code.

•

The ACMA has a reserve power to make an industry standard if there are no industry codes or if an industry code is deficient.
• Compliance with industry standards is mandatory.
• Carriers and carriage service providers must protect the confidentiality of communications.

•

The ACMA, carriers and carriage service providers must do their best to prevent telecommunications networks and facilities from being used to commit offences.
• A carrier or carriage service provider may be required to have an interception capability.

•

Carriers and carriage service providers must ensure that it is possible to execute a warrant issued under the Telecommunications (Interception) Act 1979.

•

Carriage service providers may be required to supply carriage services for defence purposes or for the management of natural disasters.

•

A carrier or carriage service provider may be required to enter into an agreement with the Commonwealth about:

(a) planning for network survivability; or
(b) operational requirements in times of crisis.

•

The ACMA must require certain carriers and carriage service providers to provide pre-selection in favour of carriage service providers.
• The Advanced Mobile Phone System is to be phased out by 1 January 2000.

•

Carriers and carriage service providers may be required to comply with certain international conventions.

•

The Minister may make Rules of Conduct about dealings with international telecommunications operators.

•

Provision is made for the technical regulation of customer equipment, customer cabling and cabling work.
• The ACMA may regulate numbering by means of a numbering plan.
• Provision is made for standard agreements for the supply of carriage services.

•

The ACMA and the ACCC may hold public inquiries about certain matters relating to telecommunications.
• The ACMA may investigate certain matters relating to telecommunications.
• Certain switching systems must be capable of providing calling line identification.
• Provision is made for the following ancillary matters:

(a) information-gathering powers;
(b) powers of search, entry and seizure;
(c) review of decisions;
(d) injunctions.

Under s 42 of the Telecommunications Act, owners of network units were prohibited from using the network unit either alone or jointly with one or more other persons to supply a carriage service to the public unless either the owner held a carrier licence itself or there was an NCD in force in relation to the network unit.
The concepts of “network unit”, “carriage service” and “supply to the public” were critical to the operation of the s 42 prohibition, and, indeed, to the extent of regulation applicable to the owner under the Telecommunications Act, but it is not necessary to descend into any detailed exegesis of those concepts, because the communications between PIPE and Strategic Directions and Strategic Directions and SLC revealed a perception that the network the subject of the proposal would be regarded as subject to the s 42 prohibition.
It may be at least observed that the perception seems to have been soundly based. Relevantly, “network unit” was defined to include certain “line links” (s 25 et seq.); “Line links” were constituted by “a line” (s 30); and “line” was defined to mean a “…, cable, optical fibre, …, conduit, … or other physical medium used, or for use, as a continuous artificial guide for or in connection with carrying communications by means of guided electromagnetic energy” (s 7). There was an obvious basis to conclude that fibre optic cable and the conduits through which it was laid when used for the proposed purpose would be regarded as subject to the s 42 prohibition.
If PIPE and SLC contracted on the basis that PIPE owned both infrastructure and cable, then SLC would not be an owner and would not have to hold a carrier licence and would therefore avoid the onerous regulatory responsibilities involved in holding such a licence. But if SLC wished to own both infrastructure and cable, it would be the subject of the s 42 prohibition and would either need its own licence or it would be necessary to have an NCD in place. (It is not clear, at this stage, whether the parties had separately considered the question of separate ownership of infrastructure and cable.)

[62] The provisions governing NCD’s were those set out in Part 3 Division 4 of the Telecommunications Act. PIPE would have to make an application to the regulator – the Australian Communications and Media Authority (ACMA) – and ACMA would have to declare in writing that the applicant was the nominated carrier in relation to the network units concerned, which ACMA would only give if ACMA was satisfied that PIPE would be in a position to comply with all of the obligations imposed on it in its capacity as the nominated carrier and making the declaration would not impede the administration of the Telecommunications Act. The result of being a nominated carrier was that the Act applied to the nominated carrier in relation to the network units concerned as if they were owned or operated by the nominated carrier.

Further PIPE written presentations

By letter dated 18 March 2005 to Strategic Directions, PIPE responded to Mr Andrea’s request to provide a list of unique features of its proposal to SLC. Amongst other features, PIPE stated:

(a) It had provided what it believed was a unique proposal to SLC to bring diverse, high- speed connectivity to the new Springfield CBD that would allow for the competitive carriage of data services into the area.
(b) The ability to deliver cost-effective and high-speed communications services into the Springfield area would be crucial to the attractiveness of the CBD to potential purchasers of land and buildings, as well as their tenants.
(c) PIPE was carrier-neutral. It would allow all other carriers to access the diverse fibre runs, and because the structure of the proposed agreement gave SLC an IRU over the fibre for 15 years, SLC could itself offer fibres to any other telecommunications carrier or end-user that they wish.
(d) PIPE was a specialised dark fibre provider. Such fibre offered the ultimate in flexibility, speed and reliability for customers who wished to use the fibres for delivery of other managed services or delivery of non-network traffic (e.g., storage) to the SLC data centre and CBD precinct. PIPE had been an active supplier in the dark fibre space for all of its existence as a carrier and would continue to be so.
(e) PIPE would include as part of any agreement with SLC the ability for SLC to assume ownership of the cable in its entirety in the case of any material events occurring.

At a stage which is likely to have been in early 2005 but after PIPE’s 18 March 2005 letter was produced, PIPE produced a more detailed 16-page version of the proposal discussed at [44] to [46] above.[15] That document appears to have been the last and most detailed proposal produced by PIPE before, as will appear, the parties:
[15] Court Book at 10164 to 10179. The Court Book dates the document at 3 March 2005. Whether it was before or after PIPE’s 18 March 2005 letter does not matter.

(a) on 21 July 2005 executed a “Dark Fibre Service Order Form” by which they entered into an agreement for the provision of services by PIPE which, amongst other things, was “subject to both parties agreeing the specific terms of the IRU or other legally binding document as agreed, provided the fundamental agreed commercial terms remain as proposed”;
(b) in October 2005 and the first week of November 2005, together with their lawyers, negotiated the terms of the IRU Agreement and the WFS Agreement; and
(c) on 7 November 2005 entered into the IRU Agreement and the WFS Agreement.

Relevant additions or changes included in the document included:

(a) The 79km network “ring” would take 180 days to build from contract signing.

(b)

A slightly changed route was identified, but the proposed laying of cable in the combination of part subducted in Telstra underground duct; part subducted in Queensland Rail concrete troughs; part in 100mm conduit beside the railway; and part in 50mm conduit was maintained.

(c)

The addition of a proposal for “Material Event Protection” as had been foreshadowed by the letter of 18 March 2005, in these terms:
Material Event Protection
An outdoor fibre optic network of any size is a long-lived asset. Over the life of this asset care and thought needs to be given to protection of those involved in the event of a material event that prevents the ongoing commercial operations for either PIPE Networks or SLC.
Any agreement entered into between PIPE Networks and SLC will have the following principles:

• a material event is an event that involves liquidation;
• network assignability will be possible in this event and/or;
• there will be a fixed charge over the network (72 cores dual fibre optic network)
Network built to allow assignment
PIPE Networks has proposed a network that is ‘Material Event Proof’. We have done this by not using tradition right of way elements such as regulated access to other carrier’s underground ducting. These paths require a separate process to assign in the event of a material event.
All outside plant is in either purpose built underground facilities or QR right of way. PIPE Networks has agreement with QR to allow assignment of fibre cores to SLC on a material event.
Note: ownership of the network will require a Carrier License or a nominated carrier declaration.

(d) Expansion of the statement concerning PIPE’s responsibilities in relation to telecommunications carrier and regulatory issues regarding the cable to include the statement:
This network will be owned and operated by PIPE Networks for the exclusive use of SLC. This means that SLC will have no carrier related regulatory issues to deal with.

• Carrier and regulatory issues regarding the cable

•

All Federal interception requirements, liaising with lead agency and preparing Interception Capability Reports
• All ACA requirements for reporting and levies
• All ACCC reporting for fixed line infrastructure as required from time to time[.]

(e) Addition of detail concerning how users of the network would be connected to it, including an explanation as to how PIPE would implement its wholesale prices for connecting local access links or tails from the location of the users in CBD buildings to the Network Access Points.

The problem was that SLC failed to prove the assumptions referred to in [422](b).
For the western route, SLC relied on the following documents:

Court book document description Date Page
number
08.02.2006

CQ163: Line diagram (Version 1) 11382
(estimated)

CQ176 (2 fibres for the Western Leg) 13.02.2006 11389
CQ212-245 (66 fibres for the Western Leg) 07.06.2006 11454
CQ163 (version 2) (2 fibres for the Western Leg) 21.10.2008 12006
CQ176: Line Diagram (Version 2) 23.10.2008 12007
(estimated)
ISOW for RT57909 – I0059 22.10.2008 12008-12009

For the eastern route, SLC relied on the following document:

Court book document description Date Page
number
Fibre diagram for RT57907 – CQ3515-50 – Springfield Land Corp Undated 12875- 12876
– Makerston St to Polaris Data Centre
[427] True it was that PIPE had, in compliance with its disclosure obligations, disclosed each of the fibre line diagram documents on which SLC now relies. Pursuant to UCPR r 227(2) they were admissible in evidence against PIPE as relevant and being what they purported to be. But the fibre line diagrams did not on their face purport to be documents which were the outcome of such a purposive activity by PIPE as would justify the assumptions referred to in [422](b) above. So far as the fibre line diagrams were concerned there was no evidence that to identify for each continuous core between Brisbane to Springfield, PIPE had identified and mapped each continuous path of the Network in “fibre line diagrams”. Nor was there evidence that the documents concerned were the outcome of such a purposive activity. Nor was there evidence that the details in the documents were accurate and reliable as to the situation in the ground. SLC argued that a Jones v Dunkel inference should be drawn against PIPE because PIPE failed to call anyone to negate the inference which SLC sought to draw. But SLC had the onus of proof. The mere existence of the documents did not justify the inference which SLC sought to draw. In my view SLC’s evidence did not rise to the stage where it could be said that the inference for which SLC contended was open or that there was a case requiring an answer by PIPE. Had it reached that stage then the absence of any evidence to the contrary from PIPE’s witnesses might have been important.

The truth of the matter was that there was a Jones v Dunkel inference to be drawn, but it was one adverse to SLC. I make the following observations:

(a) The fibre line diagrams on which SLC relied, which are identified at [425] to [426], concerned the period in which the relevant hauling and splicing and labelling of cable was done by Optilinx. SLC called Mr Van Hecke of Optilinx. He was personally involved in all this work. Yet counsel for SLC did not take Mr Van Hecke to any of those documents, or seek to have him identify them, explain what they meant (or at least what they meant to the independent contractor which, on SLC’s case, must have been acting on them), or otherwise seek to support the assumptions referred to in [422](b) above. This failure was notable and unexplained. I would infer that his evidence would not have assisted SLC’s case concerning the fibre line diagrams.
(b) I reach that inference based on SLC’s failure to question Mr Van Hecke on any of these matters in chief: cf Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 at 418.
(c) I observe that the inference gets further support from the following:
(i)       As I have already mentioned – see [268] to [270] above – Mr Van Hecke was cross-examined by PIPE on how it could have come to pass that some part of the Duplicate Network cable had been spliced into the Network cable by Optilinx, if that had in fact happened. His evidence was that it could never have occurred deliberately and, certainly, PIPE had not instructed Optilinx to do so. He found it difficult to imagine why an instruction would be given which would involve splicing new cable into an existing operative network.
(ii)      PIPE sought to have Mr Van Hecke extend his observations to parts of the work which might have been done by contractors other than Optilinx. I accept his evidence in relation to the work which Optilinx did. I ruled in favour of an objection that Mr Van Hecke could not be asked to speculate about work that he had not identified that he did, namely work which might have been done by other contractors.
(iii)     Mr Van Hecke, who was a knowledgeable and helpful witness, was present in the witness box when this exchange and that ruling occurred. The following excerpt from the transcript records SLC’s objection to the question; my ruling; that at the very end of the cross-examination, Mr Van Hecke volunteered to clarify what he thought was “a misunderstanding of terms”; and neither counsel seeking his clarification:
MR HANDRAN: Your Honour, I object. He’s asking the witness to speculate about work that he hasn’t identified he did. He can’t give evidence about the intentions or otherwise of some other contractor.
HIS HONOUR: It becomes a little hypothetical. Is it suggested that that has in fact
happened?
MR COUPER: It’s part of our learned friend’s trespass of conversion case. In fact, it rests on the proposition that that type of splicing is the foundation for the trespass of conversion claim for the misuse of Springfield’s network.
HIS HONOUR: I thought it was the use of the conduit.
MR COUPER: No, your Honour. No. The revenue data schedule which our learned friend hasn’t given your Honour yet, that aspect of the trespass conversion claim which is on the basis that there are sections where pipe has spliced its cable to part of what’s said to be the Springfield cable, some online, some offline, and therefore, it’s said we have converted that section of their cable and therefore, the whole of their cable.
HIS HONOUR: What I’m just not clear on is whether you’re suggesting – we know when this witness says that his company did it, and if there are sections where his company did it, then you really, to be fair to the witness, say, “Well, this is – it’s said this happened. That must be a mistake.” But you can’t ask him to speculate upon the possibility that someone else might have done it and it might be a mistake by someone else.
MR COUPER: I accept that, your Honour. I think I’ve asked the questions I can ask of this gentleman about what his instructions were, whether he [indistinct] but I won’t seek to have him give evidence about what other people might or might not have done.
WITNESS: This is a misunderstanding of terms. to clarify that last - - -
HIS HONOUR: No. Just - - -
MR HANDRAN: No. Just - - -
HIS HONOUR: No. Just – you’ve got to – you’ve got to wait to be asked a - - -?---Okay.
- - - question?---Yep.
MR COUPER: That’s the cross-examination, your Honour.
HIS HONOUR: Mr Handran.
MR HANDRAN: No re-examination, your Honour. May the witness be excused?
No. Apparently he doesn’t, so we’ll be left about that?---It’s important. Okay.
Anyway, that’s – thank you for your assistance?---Thank you.

(d) It seems to me that a Jones v Dunkel inference may be drawn from the failure of SLC’s counsel to seek clarification from Mr Van Hecke of the misunderstanding.

I am not prepared to accept the correctness of the conclusion which SLC contends for based on its analyses of the documents because it requires me to draw inferences about the documents which I am not prepared to draw. I do not reach the requisite state of positive satisfaction as required by the principles referred to at [32] to [36] above.
The failure by SLC to establish the starting point as to the correct and precise identification of the particular fibres which made up SLC’s 72f Network means that the subsequent elaborate analyses which attempt to show (1) that PIPE gave instructions to carry out splicing activity in relation to particular fibres which must be regarded as SLC’s fibres; and (2) the particular fibres which were the subject of the alleged splicing activity must have been SLC’s fibres, must also fail. At its highest the subsequent analysis relies on admissions by PIPE that particular fibre pairs which it admittedly used were fibre pairs which used particular numbered fibres on a particular identified cable in particular joints. If SLC cannot prove that the particular fibres on that particular cable were the fibres owned by it in the first place, the fact that PIPE used the fibres is not relevant. PIPE might be expected to use the fibres if the fibres were theirs.
The trespass and conversion case fails at the threshold because SLC failed to persuade me to make findings consistent with its foundational proposition.

SLC did not establish relevant rights to the Landcorp infrastructure

[432] Further, and in any event, SLC did not establish that it had such rights in relation to the Landcorp infrastructure as would support a trespass or conversion case.

The breach of fiduciary duty and unconscionable conduct case

SLC alleges that SLC and PIPE were in a fiduciary relationship and that the fiduciary duties owed by PIPE were:

(a) “to refrain from pursuing, obtaining or retaining for [PIPE] any collateral advantage in relation to the Network without the knowledge and informed consent of [SLC]”; and
(b) “to not place itself in a position where its obligations to [SLC] and its private interests may conflict.”

SLC alleges PIPE breached the alleged fiduciary duties by:

(a) constructing the Duplicate Network;
(b) connecting the Duplicate Network to the Polaris Data Centre;
(c) operating the Duplicate Network for its own benefit; and
(d) operating the Duplicate Network in competition with SLC’s telecommunications business.

SLC contends the same conduct was unconscionable on the part of PIPE.

The alleged fiduciary duties did not exist

[436]   It is unnecessary to embark upon a treatise on the law of what constitutes a fiduciary relationship. It suffices to note that PIPE correctly contended (footnotes in original):
The critical feature of a fiduciary relationship is that the fiduciary “undertakes or agrees to act for or on behalf of or in the interest of another person in the exercise of a power or discretion which will affect the interests of that other person in a legal or practical sense”. The phrase “for or on behalf of” and the phrase “in the interest of” must be understood in a reasonably strict sense.[71]
[71]            Hospital Products Limited v United States Surgical Corporation (1984) 156 CLR 41 at 96-97; John Alexander’s Clubs Pty Ltd v White City Tennis Club Limited (2010) 241 CLR 1 at [87] – [90].
“Where a term to like effect as the suggested fiduciary obligation cannot be implied, it will be very
difficult to superimpose the suggested fiduciary obligation upon that limited contract.”[72]
[72]            John Alexander’s Clubs at [92].

[437] The proposition that SLC and PIPE were in a fiduciary relationship cannot be accepted. They were not.

First, one must have regard to the nature of the relationship between the parties at the time they entered into their contractual relationship. It did not have any of the hallmarks which might justify the conclusion that PIPE was a fiduciary so as to justify the contended for duties. To the contrary, as I have earlier remarked, the parties were both sophisticated commercial actors who had embarked upon a process (with the assistance of legal and other advisers) of negotiating for and entering arms-length commercial contracts in which they both realised and expected that the other was free to seek to maximise its own commercial interests. Their conduct towards each other in relation to their contemplated contract must be taken to have evidenced the contemplation that the extent to which they sought to constrain that freedom was something which would be dealt with by their contract. The result was that, so long as their conduct did not breach their contractual promises to each other, each was entitled to maximise its own commercial interests without regard to the interest of the other. The purpose of the contemplated relationship was the promotion by each party of their own commercial interests.
Second, what I have just observed seems to me to reflect an objective assessment of the way in which the parties conducted themselves leading up to their entering into their contract. But, as I turn explain, it also reflected at least the actual intentions of Ms Sinnathamby, whose significance in the decision-making and intentions of SLC has already been identified. She was cross-examined as to the nature of SLC’s intention at the time of contracting, so far as the character of its relationship with PIPE was concerned.

[440] She was taken to:

(a) cl 19(b) of the IRU Agreement which provided:
For the avoidance of doubt, nothing in this clause 19 shall have effect to prevent, limit or otherwise adversely affect the ability of SLC to resell or sub-lease Fibre Capacity on the Network acquired under this agreement to another person.

(b)

cl 6 of the IRU Agreement which governed resale or sub-lease of Fibre Capacity, which relevantly provided:
6.1 Right to resell or sub-lease
Subject to this agreement, SLC has the right to resell or sub-lease any part or all of its Fibre Capacity to a Fibre Capacity User for a period not exceeding the Term on the terms set out in this clause 6 and the [WFS Agreement].
6.2 Access to wholesale pricing

(a) PIPE undertakes to offer Fibre Capacity Users and SLC its wholesale (Carrier) pricing in respect of connections to the Network Access Points.
(b) SLC must use its best endeavours:

(i) to introduce PIPE to potential Fibre Capacity Users which require connection to the Network Access Points; and
(ii) to encourage potential Fibre Capacity Users to consider the terms of an offer made by PIPE in respect of connection to the Network Access Points.

and agreed that SLC’s intention was that it could sell some fibres to PIPE, it could sell fibres to anybody else that it chose, and PIPE couldn’t stop SLC doing that, qualifying that acknowledgement by explaining that SLC assumed that what would happen was that PIPE would really work with SLC to sell the fibre.

Her attention was also drawn to cl 2 of the WFS Agreement and agreed that it was SLC’s intention at the time the agreement was signed that if PIPE had submitted an order to SLC for use of an IFS, SLC could simply respond by saying that it did not agree to PIPE using the IFS.
Her attention was drawn to cll 6(a) and (b) of the WFS Agreement, which provided:
Our wholesale relationship

(a) This agreement does not create a relationship of employment, agency or partnership between the parties.
(b) PIPE must not represent that PIPE is an agent or dealer of SLC.

I interpolate that, although she was not taken to cl 17 of the IRU Agreement, it is in identical terms to cl 6(a) of the WFS Agreement. Ms Sinnathamby agreed that it was SLC’s intention at the time that the WFS Agreement was signed that PIPE would not be an agent or partner of SLC, and that PIPE would not be regarded as a dealer for SLC.
She was also taken to cl 6(d)(ii) of the WFS Agreement, which provides that “nothing in this agreement prevents SLC from offering to supply, or supplying Fibre Capacity in the Network to other C/CSPs”. She acknowledged that SLC’s intention – reflected in that clause – was that SLC could charge other carriers and carriage service providers to use any or all of the Fibre Capacity of the Network if SLC chose. When it was then suggested that SLC’s intention was that it could cut PIPE out of the picture entirely in terms of use of Fibre Capacity, she denied that that outcome would have crossed SLC’s mind.

[445] It is difficult to accept that latter proposition at face value, given the obviousness of the wording of the clause. Although, I have generally accepted that she was attempting to give her evidence honestly, by that stage of the cross-examination, I think she was descending into advocacy a little, and that rendered her evidence unreliable. That much became perfectly clear in the immediately following passage of cross-examination when she asserted an incredible proposition about her belief as to whether there was an ability to extend the operation of the WFS Agreement. When pressed on that she retreated to state she had that belief “to the best of my recollection”. And when pressed further about whether she could really say that was her belief given the wording of the relevant terms, she retreated still further to the proposition “I believe it didn’t cross our mind to put the extension in this here, in this clause.” When pressed still further she agreed that she knew that there was no term arranged for extension but said only she could not recall whether it was deliberate or merely an omission.
[446] I observe that Mr Sharpless made some attempt in his evidence to characterise the relationship in a way which would suit SLC’s argument, by referring to PIPE as SLC’s business partners, but I do not accept that evidence. It flew in the face of the express terms of the relevant contracts and was a self-serving statement by an interested witness. In the context of this case, I would treat such uses of the term “partner” by a lay person as having no significant weight in relation to the question before me.

Third, the next and clearest indications against a conclusion of a fiduciary relationship can be found in the terms of the contractual arrangements between the parties. They contained the clauses expressly negativing any conclusion that their relationship should be characterised as one of employment, agency or partnership. Whilst fiduciary relationships can be found to exist other than in relationships which can be so characterised, these express clauses were, to my mind, a very clear indication against the conclusion for which SLC contends.
I completely accept PIPE’s submission that the two agreements to which PIPE and SLC are parties set out in detail their rights and obligations regarding the installation and management of the cable and that no terms of the agreements or other features of their relationship supported the characterisation of the relationship as fiduciary.

[449] As there was no fiduciary relationship, it is unnecessary further to consider SLC’s various contentions as to alleged breach of the duties which might have existed if the relationship had been fiduciary.

PIPE’s conduct was not unconscionable

SLC founds its case in alleged contravention by PIPE of the obligation expressed in s 51AC of the Trade Practices Act 1974 that:

(1) A corporation must not, in trade or commerce, in connection with:

(a)

the supply or possible supply of goods or services to a person (other than a listed public company); or

(b)

the acquisition or possible acquisition of goods or services from a person (other than a listed public company);
engage in conduct that is, in all the circumstances, unconscionable.

SLC’s complaint has been outlined in [434] above.
In Barboza v Blundy [2021] QSC 68 at [163] to [166], I considered the nature of the evaluative judgment called for by an equivalent statutory provision. I do not apprehend that there is anything in the discussion of principle by the Court of Appeal in Adani Abbot Point Terminal Pty Ltd v Lake Vermont Resources Pty Ltd [2021] QCA 187 at [112] to [122] to suggest any error in that discussion.
It will be apparent from what I have previously written in these reasons that I regard PIPE merely to have taken commercial advantage of the ownership rights which it had expressly and explicitly bargained for. There was neither an express term nor an implied term of either the IRU Agreement or of the WFS Agreement which expressly constrained it against so doing. The bargain was struck at arms-length between properly advised sophisticated commercial actors. There was no predation or trickery revealed in the manner by which PIPE went about securing to itself the bargain. There is nothing in PIPE’s taking advantage of the rights which it had secured for itself which could attract the evaluative judgment which SLC seeks to have me form.

In its closing submissions SLC contended that the features of PIPE’s conduct which should attract that judgment were these (emphasis in original):
First, the construction and connection of the Duplicate Network to Polaris was conduct undertaken by PIPE when it was managing the Network for [SLC]. PIPE knew of the location and route of the Network and used that information in order to construct the Duplicate Network. It was not conduct which undertaken in any open or transparent way and at a time after [SLC] was locked into a long term contract and PIPE had used its position viz a viz the Network to secure tenant space at Polaris.
Secondly, the pretence upon which PIPE was allowed to connect its cables to Polaris was that those cables would provide “additional options to Springfield for future capacity”. That statement was false, knowingly so, and was intended to conceal, rather than reveal, the purpose for which access was being sought. PIPE has not called one witness to say that the Duplicate Network was installed to provide [SLC] with any additional fibre capacity.
Thirdly, SCG was evidently in a position of economic and commercial vulnerability in the sense that it had retained PIPE to operate and maintain the Network for up to 30 years. If the conduct of PIPE was not in breach of contract, [SLC] remained captive to PIPE should it find the installation and operation of the Duplicate Network insulting and unworkable.
Fourthly, [SLC]remained captive to PIPE by reason of it continuing to be the “face” of the Network and the interface between [SLC]and its customers. Under the IRU and the NCD that PIPE secured, [SLC] had nowhere else to go. All the while, PIPE remained able to exploit confidential information and the customer relationships which it was permitted to develop under the IRU, and [SLC]remained essentially powerless to know if or how that was occurring; PIPE was obliged (but from about 2013 failed) to provide any revenue reports to [SLC]. The sharp practice associated with PIPE building and operating the Duplicate Network thus enabled it to directly or indirectly secure a commercial advantage, which could be used detrimentally against [SLC].

[455] There is nothing in any of those propositions. They are merely an emotively-expressed mishmash of propositions I have already rejected. I observe:

(a)

I have explained why SLC failed to demonstrate any breach of contract by use of Confidential Information.

(b)

And there was nothing wrong with PIPE securing tenant space at the Polaris Data Centre. To the contrary, the parties had agreed that it would use its best endeavours to do so: see cl 3.2(a) of the IRU Agreement.

(c)

I have explained that I reject SLC’s attribution of misleading conduct and trickery to PIPE’s conduct in arranging access to the Polaris Data Centre.

(d)

The suggestion that SLC was “locked into” anything is spurious in this context and for this argument. SLC had no vulnerability in the sense suggested. It was not captive in any sense. It could, and the evidence reveals did, use the Fibre Capacity for which it had contracted and for the purposes which it had contemplated. Ultimately when that capacity had almost reached 100%, it built further fibre capacity.

I agree with PIPE’s argument that SLC’s unconscionable conduct case is without substance.

Other equitable claims

Breach of duty of confidence

As previously identified, although SLC had pleaded a case based on breach of an equitable duty of confidence, it was not pursued.

Claim based on a claim for equitable estoppel.

In its written opening, SLC suggested that:
PIPE’s conduct gave rise to a reasonable expectation, on the part of [SLC], that PIPE would not compete with [SLC]. PIPE’s conduct for the purpose of this estoppel is the same conduct that is relied upon in order to establish the representations by omission referred to above. PIPE cultivated this expectation and encouraged [SLC] to act upon it.
SLC made no attempt to support an estoppel claim in its closing submissions. And, as I have rejected its misleading and deceptive conduct cases, its breach of fiduciary duty case, and its unconscionable conduct case, there is no merit in my attempting to analyse the case through the lens of estoppel when SLC has not sought to persuade me that any different result might be obtained by that mechanism, if the other cases failed.

Claims for breach of statutory duty

[460] SLC had pleaded a claim that the effect of the statutory provisions referred to in [337](a) above was to impose a duty on PIPE to give notice in the terms required by Schedule 3, s 17 of the Telecommunications Act to SLC and its related entities before accessing their land and doing work on the Off-Rail sections of the Network. That claim must fail for the reasons expressed in [337](b) above.

Claims for injunctive relief and declaratory relief

SLC’s pleading sought an injunction restraining PIPE, by its agents or otherwise, during the Term of the IRU Agreement from:

(a)

being engaged, concerned or interested, in any business or undertaking as a telecommunications asset owner offering competitive fibre cable capacity to wholesale suppliers or end-users of telecommunications services to Springfield;

(b)

further or alternatively, using any infrastructure relating to the Off-Rail section of the Network, including any cable situated therein comprising the Duplicate Network.

Both claims fail because SLC has neither established that any equitable or legal right which it might have needs protection by any such order, nor that such an order is necessary to prevent any legal or equitable wrong being done or threatened to be done to it. In any event the Term of the IRU Agreement has expired.
SLC also sought an order that PIPE remove the Duplicate Network from the conduit owned by SLC. This claim fails for the same reasons. In particular, the conduit is not owned by SLC.

[464] SLC also sought an injunction restraining PIPE from interfering with, or removing, any of the customers on SLC’s Network, other than on the instructions of the plaintiff, for the remaining duration of the IRU Agreement. This claim fails for the same reasons.

Claim for declaratory relief

SLC’s pleading sought a declaration that, on the proper construction of the IRU Agreement and the WFS Agreement:

(a) the Term of the IRU Agreement may be extended under cl 13.1(c) by either party unilaterally; and
(b) the Term of the WFS Agreement ends at the end of the Term under the IRU Agreement.

No such declaration should be made.
As to the first part, even if cl 13.1(c) expressed a certain and enforceable obligation (which, for reasons previously expressed, it does not) the declaration sought would not express the proper construction of the clause. The Term would only be extended if the clause was engaged and the negotiation was successful.
As to the second part, cl 10.1 of the WFS Agreement plainly expressed a fixed Term not so expiring, and SLC abandoned any attempt to persuade me that there was any other construction of the agreement.

Conclusion and orders

There should be judgment for PIPE on SLC’s claims. There presently appears to me to be no reason why costs should not follow the event, but in case there are considerations not presently before me which might affect the form of any costs order, I will hear the parties as to costs.

Appendix 1 – Rulings on unresolved objections to Court book

#	Description	Date	Disclosure	Page number	PIPE’s	SLC’s response	Ruling
reference	objection

Chronological bundle

48.	Cost of Springfield to Brisbane	Undated	D4LOD 21	10114	Relevance	This document is	PIPE had by disclosing
fibre build	(estimated	relevant and requires the	the document admitted
2005)	Court’s consideration.	that it tended to prove
This document has been	or disprove a fact in
disclosed by PIPE,	issue. I am not
which is recorded by the	persuaded to take a
“DLOD” reference in	different view by an
the “Disclosure	objection which merely
reference” column. Per	asserts a change of mind.
r 227 of the UCPR, it is	Objection overruled
plain that the document is disclosed by PIPE and therefore relevant and
admissible
73.	Submission Sheet from Pipe	22.07.2005	D6LOD 17	10336-10350	Relevance	As per item 48	As per item 48
Networks to USQ – Provision of High-Speed External Link to Springfield Campus
80.	Email from Chris Schroor to	07.09.2005	DLOD 92	10364	Relevance	As per item 48	As per item 48
Bevan Slattery and others – USQ Tender
83.	Email from Chris Schroor to Rob	19.09.2005	DLOD 93	10429	Relevance	As per item 48	As per item 48
Boogers and Brendan Hemmings – Springfield Data Centre
96.	Email chain ending between Bevan	11.10.2005	DLOD 96	10610	Relevance	As per item 48	As per item 48. Further,
Slattery, Chris Schroor, Mike	the nature of the
Andrea and Brent Paddon – RE:	document explains some
Contracts	aspects of the timing of what occurred during the final negotiation of the salient contracts and may be regarded as relevant for that reason
99.	Polaris Data Centre Information	13.10.2005	D4LOD 9	10656-10687	Relevance	As per item 48	As per item 48
Memorandum
124.	Pipe Networks Limited Invoice to	21.11.2005	D4LOD 27	11295	Relevance	As per item 48	As per item 48
Springfield Land Corporation – First Progress Payment (25%) on Phase 1 Dark Fibre Installation
128.	Pricing spreadsheet [5 tabs]	28.11.2005	D7LOD 396	11342-11346	Relevance	As per item 48	As per item 48

137.

chain

between

Chris

18.01.2006

P3LOD 96

11379-11381

Relevance

This document is

As per item 48

Schroor, Maha Sinnathamby, – relevant and requires the

David Henry, Bob Sharpless, 19.01.2006 Court’s consideration.
Michael Kerry, Russell Luhrs and In that regard, it is
Con Sciacca – Data Centre 0 Dr referred to in the
Leo Kelleher plaintiff’s case. The
email chain is directly
relevant to the
allegations in [16(b)] and
[23A] of the Statement
of Claim

168.	Budgetary Pricing for Services to	04.01.2007	D10LOD 246	11551	Relevance	As per item 48	As per item 48
Springfield

199.	Diagrams	of	cable	laid	in	Undated	DSLOD 12	1172-11785	Description:	The plaintiff agrees that	I accept SLC’s
Springfield	(estimated	(pages 1-14)	This document	all 14 pages of this	submission. Objection
2007)	has been	document can be dealt	overruled
incorporated	with in one entry, being
over two	document 199 of the
entries	Court Book Index, and
(documents	does therefore not resist
186 and 199).	PIPE’s objection to the
The defendant	duplicate document 186.
submits that	PIPE’s objection to this
this document	document should
ought to be	therefore be overruled
included in one entry.

217.	Letter from Pensar Pty Ltd to	17.03.2008	PLOD 16	11864-11885	Relevance	This document is	The document is
Cardno – Sinnathamby Boulevard	relevant and requires the	relevant because it tends
– Contract 1 – Progress Claim No. 32	Court’s consideration.	to support the
– February 2008	In that regard, it is	conclusion that relevant
referred to in the	infrastructure was
plaintiff’s case. This	constructed via
invoice is being relied	engagement of an
upon as evidencing	independent contractor.
SLC’s ownership of the	It does not establish
LandCorp infrastructure	SLC’s ownership of the
and is therefore directly	LandCorp infrastructure
relevant to the	for reasons canvassed in
allegations in [3B] of the	the body of my reasons,
Statement of Claim	but that does not make it inadmissible
221.	Letter from Pensar Pty Ltd to	06.06.2008	PLOD 17	11893-11919	Relevance	As per item 217	As per item 217
Cardno – Sinnathamby Boulevard – Contract 2 – Progress Claim No. 30 – May 2008
264.	SBDF Network Pricing	04.02.2009	D10LOD 245	12109	Relevance	As per item 48	As per item 48

398. Email Chain between David

23.09.2013

DLOD 165

12796-12844

Relevance

As per item 48

Collyer, Andrew Perkins, Mike –
Andrea, Reggie Naik, Danny 24.09.2013

Brady, Wayne Springer and Robert Lee – RE: Mid-path fibre access

Revenue Data Documents

467.

Certificate

Practical

27.05.2010

D8LOD 9

14888

Relevance

As per item 48

Completion – CQ5895

468.	Circuit Summary Extract: CQ5895	02.07.2019	D10LOD 28	14889	Relevance	As per item 48	As per item 48
611.	Sales order for CQ35677	06.06.2017	D8LOD 45	15620-15622	Relevance:	As per item 48	I uphold the objection
This document	for the reasons advanced
relates to	by PIPE
revenue received by a company that is not the defendant. It does not relate to a contract involving the defendant
765.	Sales order for CQ23344	08.04.2016	D8LOD 40	16104-16105	Relevance: As	As per item 48	As per item 48
per item 611
989.	Contract with Datacom	08.03.2011	D7LOD 54	16799-16801	Relevance:	As per item 48	As per item 48. I am
The document	unable to understand the
is a contract	significance of the
that	additional submission
constitutes	advanced by PIPE
Managed Service Agreement 5934 not 5394. Managed
Service Agreement 5934 is not in dispute
990.	Service ID – 9037 – Historical	11.09.2019	D10LOD 303	16802-16805	Relevance:	As per item 48	As per item 989
Extract	(estimated)	This document is a service extract provided pursuant to Managed Service Agreement 5934 not 5394. Managed Service Agreement 5934 is not in dispute
991.	Contract with Datacom	19.11.2012	D7LOD 55	16806	Relevance:	As per item 48	As per item 989
The document is a contract that constitutes Managed Service Agreement 5954 not 5395. Managed Service Agreement 5935 is not in dispute
992.	Contract with Datacom	03.08.2011	D7LOD 56	16807-16809	Relevance: As	As per item 48	As per item 989
per item 991
993.	Service ID 12507 – Historical	11.09.19	D10LOD 308	16810-16815	Relevance:	As per item 48	As per item 989
Extract	(estimated)	This is a document service extract which relates to services provided pursuant to Managed Service Agreement 5935 not 5395. Managed Service Agreement 5935 is not in dispute
994.	Service ID – Historical Extract	11.09.2019	D10LOD 306	16816-16819	Relevance: As	As per item 48	As per item 989
(estimated)	per item 993
1171.	Contract with Datacom	04.02.2013	D7LOD 110	17269-17272	Relevance:	As per item 48	As per item 989
This document relates to Managed Service Agreement 4944 not 8363. Managed Service Agreement 4944 is not in dispute
1225.	Contract with Datacom	17.07.2014	D7LOD 127	17392	Relevance:	As per item 48	As per item 989
This document relates to Managed Service Agreement 8437 not 10931

(e)	an order that PIPE remove the Duplicate Network and an injunction permanently restraining PIPE from obstructing SLC from removing those parts of the Duplicate Network that are in conduits owned by SLC;
(f)	a declaration that, on the proper construction of the IRU Agreement and the WFS Agreement, the term of the IRU Agreement may be extended under clause 13.l(c) by either party unilaterally;
(g)	an injunction restraining PIPE from interfering with, or removing, any of the customers on SLC’s Network, other than on the instructions of SLC, for the remaining duration of the IRU Agreement;
(h)	interest pursuant to the Civil Proceedings Act 2011; and

(a)	the text of the terms, the meaning of which is disputed;
(b)	the internal context within which that text occurred, namely the entire text of the Agreement as well as the particular documents referred to in the text of the Agreement; and
(c)	evidence of events, circumstances and things external to the Agreement which were known to the parties or which assist in identifying the purpose or object of the transaction.

•	become a carrier or deal with any carrier related issues,
•	deal with end users of fibre services between Springfield and Brisbane[.]

(b)	The provision of cost information concerning existing high-speed data transmission to Springfield via Optus or Telstra.
(c)	Explanation of the recommendation for a 72-core count network.
(d)	The provision of further detail concerning the route description by a diagram showing the eastern leg of the route described as “City to Springfield via Sydney-Brisbane Rail Line” and the western leg of the route described as “City to Springfield via Ipswich- Brisbane Rail Line”. Further detail was then set out, including that parts of the eastern leg of the route would be subducted in Telstra underground duct; part subducted in Queensland Rail concrete troughs; part in 100mm conduit beside the railway; and part in 50mm conduit. Part of the western leg would be subducted in Queensland Rail concrete troughs and part would be in 50mm conduit.
(e)	The statement that fibre cable has a stated life of 15 years. The statement that the life of the asset would be 20 to 30 years, excluding cable life, and the provision of a conditional quote to re-haul the network as an end-of-life upgrade.
(f)	The provision of comparative pricing for network build and maintenance as between a 72-core network and a 144-core network. The quote for the former was reduced slightly to $6,323,000. The quote for the latter was $7,239,000.

o	The means SLC can bundle fibre connectivity into leasing arrangements if required
o	By treating this as an investment, SLC can make a solid return in the medium to long term

-	The ability to guarantee fibre connectivity in the SLC submission to Qld Govt Dept of Public Works
-	The ability to market the capability around the Data Centre publicity statements
-	15 years maintenance and support of the links
-	Carrier independency as SLC can provide fibre connectivity to any carrier as needed (possibly at wholesale rates as part of the ROI model)[.]

•	SLC underwrite both legs of an optic fibre installation (72-core cables) – capital for the installed cable runs of $4.621 m exGST
•	PIPE Networks manage and maintain the fibre infrastructure, including all regulatory issues for 15 years, paid up-front ($1.702m) or annually ($115k)
•	PIPE owns the cable, however, SLC takes a 15 year IRU over both legs of the cable
•	Total capital contribution for cable installation and 15 years maintenance $6.323m exGST
•	Options were provided to only install one of the legs, and pricing to increase the core count to 144-core cable
•	The quote is valid for 90 days

•	Buy-back / buy-out and the end of the contract term
•	Use of Commercial (revenue) Triggers during the contract term for PIPE to buy the infrastructure off SLC
•	Basis is currently a pay-back within 36 months
•	Ability under an NCD (where SLC owns the infrastructure) for other carriers to bid/purchase the infrastructure at any time[.]

•	a material event is an event that involves liquidation;
•	network assignability will be possible in this event and/or;
•	there will be a fixed charge over the network (72 cores dual fibre optic network)

•	Carrier and regulatory issues regarding the cable
•	All Federal interception requirements, liaising with lead agency and preparing Interception Capability Reports
•	All ACA requirements for reporting and levies
•	All ACCC reporting for fixed line infrastructure as required from time to time[.]

CQ176 (2 fibres for the Western Leg)	13.02.2006	11389
CQ212-245 (66 fibres for the Western Leg)	07.06.2006	11454
CQ163 (version 2) (2 fibres for the Western Leg)	21.10.2008	12006
CQ176: Line Diagram (Version 2)	23.10.2008	12007
(estimated)
ISOW for RT57909 – I0059	22.10.2008	12008-12009

(a)	This agreement does not create a relationship of employment, agency or partnership between the parties.
(b)	PIPE must not represent that PIPE is an agent or dealer of SLC.

David Henry, Bob Sharpless,	19.01.2006	Court’s consideration.
Michael Kerry, Russell Luhrs and	In that regard, it is
Con Sciacca – Data Centre 0 Dr	referred to in the
Leo Kelleher	plaintiff’s case. The email chain is directly relevant to the allegations in [16(b)] and [23A] of the Statement of Claim

Collyer, Andrew Perkins, Mike	–
Andrea, Reggie Naik, Danny	24.09.2013
Brady, Wayne Springer and Robert Lee – RE: Mid-path fibre access