TMA Australia Pty Ltd v Indect Electronics & Distribution GmbH

The dispute before the New South Wales Court of Appeal concerned a contract for the purchase of software between TMA Australia Pty Ltd (the distributor and reseller) and Indect Electronics & Distribution GmbH (the original supplier). TMA Australia alleged that Indect had breached the contract and engaged in unconscionable conduct under the Australian Consumer Law by withdrawing support and ceasing direct supply of the software.

The Court was required to determine several legal issues. These included whether Indect's requirement for a three-monthly authenticity check for the software constituted a breach of a term that the licence to use would be of unlimited duration, and whether it breached a warranty that the software would be fit for purpose. Furthermore, the Court had to consider whether an implied term existed within the supply contracts, obliging Indect to provide parts and support services to TMA Australia for the continued operation of the systems for their lifetime, irrespective of the distributorship arrangement, and at prices applicable to ongoing resellers. The Court also examined whether equitable and conventional estoppel applied, based on an assumption adopted between the parties regarding Indect's ongoing obligation to provide necessary parts and support. Finally, the Court considered whether Indect's conduct in withdrawing support and ceasing direct supply to TMA Australia was unconscionable under section 21 of the Australian Consumer Law.

The Court of Appeal dismissed TMA Australia's appeals. It found that the authenticity check did not breach the term regarding unlimited duration of the licence, nor did it breach the warranty of fitness for purpose. The Court also held that no implied term for lifetime support existed, as the conduct and statements of the parties did not support such an implication, nor was it necessary for the reasonable operation of the supply contracts. Similarly, the Court found that the elements of estoppel were not established. Regarding the Australian Consumer Law claim, the Court concluded that Indect's conduct was not unconscionable.

Consequently, the appeals were dismissed with costs.