Telstra Corporation Ltd v First Netcom Pty Ltd

FEDERAL COURT OF AUSTRALIA

EQUITY - MAXIMS - HE WHO SEEKS EQUITY MUST DO EQUITY - application to restrain telecommunications provider from terminating agreement to provide service to others - substantial amounts claimed to be owing by applicant under agreement - no evidence of solvency of applicant - whether mandatory injunction should be conditional upon applicant paying amounts in dispute or paying into court or securing the payment of the whole or part of such amount - injunction dissolved.

Trade Practices Act 1974 (Cth)

Maguire v Makaronis (1997) 144 ALR 729, referred to
Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161, applied
Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499, applied
Coco v AN Clark (Engineers) Ltd [1969] RPC 41, applied
Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 156 CLR 414, applied

TELSTRA CORPORATION LTD v FIRST NETCOM PTY LIMITED
NG 483 of 1997

Lockhart, Beaumont & Hill JJ
Sydney
2 September 1997

GENERAL DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 483 of   1997

ON APPEAL FROM A SINGLE JUDGE OF THE
FEDERAL COURT OF AUSTRALIA

BETWEEN:	TELSTRA CORPORATION LTD Applicant
AND:	FIRST NETCOM PTY LIMITED Respondent

JUDGES:      LOCKHART, BEAUMONT & HILL JJ
DATE:          2 SEPTEMBER 1997
PLACE:        SYDNEY

THE COURT ORDERS THAT:

1. Leave to appeal be granted.

   
   
   

2. The appeal be allowed in part.

3. Order 1(a) of the orders made on 16 August 1997 be set aside.

4. Appeal otherwise dismissed.

5. The order that First Netcom Pty Limited provide security in respect of the undertaking given by it as to damages be set aside.

   
   
   

6. The Respondent First Netcom Pty Limited pay Telstra Corporation Ltd’s costs of the application for leave to appeal and the appeal and 75% of the costs of Telstra Corporation Ltd in seeking interlocutory relief.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 483 OF 1997

BETWEEN:	TELSTRA CORPORATION LTD Applicant
AND:	FIRST NETCOM PTY LIMITED Respondent

JUDGES:	LOCKHART, BEAUMONT & HILL JJ
DATE:	2 SEPTEMBER 1997
PLACE:	SYDNEY

REASONS FOR JUDGMENT

THE COURT:
Telstra Corporation Limited (“Telstra”) seeks leave to appeal, and if leave is granted appeals against the judgment of a judge of this Court restraining it until further order from discontinuing the supply of tariffed services to First Netcom Pty Limited (“First Netcom”) and from communicating the fact of that discontinuance to customers of First Netcom in the terms of a draft letter which Telstra had indicated it proposed to send.

BACKGROUND

The background to the dispute between the parties, a dispute which is both acrimonious and multi-faceted, is to be found in the partial deregulation of telecommunications within Australia which commenced in around the end of 1994.

In July 1995 First Netcom became an intermediate purveyor of telecommunication services, buying local call services from Telstra (presently the only viable…