Network Ten Pty Ltd v Seven Network (Operations) Ltd [2014] NSWSC 752

Supreme Court New South Wales

Medium Neutral Citation: Network Ten Pty Ltd v Seven Network (Operations) Ltd [2014] NSWSC 752 Hearing dates: 6 June 2014 Decision date: 06 June 2014 Jurisdiction: Equity Division - Expedition List Before: Stevenson J Decision: Declare Ten Agreement to be on foot; proceedings otherwise dismissed; plaintiff to pay defendants' costs Catchwords: COSTS - costs to follow the event - plaintiff to pay defendants' costs; PROCEDURE - judgments and orders - final orders Cases Cited: Network Ten Pty Ltd v Seven Network (Operations) Ltd [2014] NSWSC 692 Category: Costs Parties: Network Ten Pty Ltd (Plaintiff) Seven Network (Operations) Limited (First Defendant) John Stephens (Second Defendant) Representation: Counsel: D B Studdy SC with S Mirzabegian (Plaintiff) A J Sullivan QC with D F C Thomas (Defendants) Solicitors: Baker & McKenzie (Plaintiff) Johnson Winter & Slattery (Defendants) File Number(s): SC 2014/78504

EX TEMPORE Judgment (REVISED) 1I gave judgment in these proceedings on 29 May 2014: Network Ten Pty Limited v Seven Network (Operations) Limited [2014] NSWSC 692. 2In my reasons I indicated that I was prepared to declare that the Ten Agreement was still on foot but that the proceedings should otherwise be dismissed. 3My indication of preparedness to make that declaration was hardly a victory of substance for Ten. It fell short of the declaration that Ten sought and Seven did not, in any event, contend in its pleadings or in its submission that the Ten Agreement was not on foot. 4In my reasons I dealt with, and rejected, a submission which arose from communications between the parties in March that Mr Stephens was labouring under some kind of disability, arising from post-operational symptoms, when he entered into the Ten Agreement. At the hearing Mr Stephens and Seven only relied upon these matters as being relevant to discretion, and the matter was hardly pressed. 5Otherwise, Ten was unsuccessful. Ten could not succeed unless it established the breach of contract for which it contended, and it failed to do that. 6I did find, contrary to the contentions of Mr Stephens and Seven (and contrary to press statements both made since the judgment was delivered) that Seven induced Mr Stephens to stay with Seven and not go to Ten. That was to no avail so far as Ten is concerned, absent a finding of breach of contract. 7In my opinion, Mr Stephens and Seven have been substantially successful and should have their costs of the proceedings. 8In written submissions received by me earlier this week, Mr Stephens and Seven sought an order for indemnity costs from 9 May 2014 based upon a Calderbank offer made to Ten on 6 May 2014, a little over a week before the hearing. The offer was expressed to be open until 5pm on 9 May 2014, two business days before the hearing. 9The essential terms of that offer were: (a)that Mr Stephens cease to be an employee of Seven from 8 June 2014 and not engage in any employment with Seven, Nine Network Pty Ltd or Ten for a period of one year from that date; (b)each of Seven and Ten pay Mr Stephens a sum of $50,000; and (c)each party pay their own costs with the exception of the costs of the interlocutory hearing before Brereton J. 10I was told at the outset of the argument today that Mr Stephens and Seven did not press an application for indemnity costs based on that offer. Had the matter been pressed, I would have been disinclined to order indemnity costs because of the anti-competitive implications of the arrangement proposed. I would have concluded that it was not unreasonable for Ten to not have accepted the proposal. 11I mention the matter because Mr Studdy SC, who appears with Ms Mirzabegian for Ten, sought to rely upon that offer as being a reason why a costs order should be made in favour of Ten. I see nothing in the offer that would lead me to any such conclusion. 12Mr Studdy submitted the fact that Mr Stephens and Seven had abandoned their claim for indemnity costs at a minute to midnight before this application was a matter relevant to what order I should make as to costs of today. I accept that submission. 13I make the following declaration and orders: (1)I declare that the agreement made between the plaintiff and the second defendant on 6 March 2014 remains on foot. (2)I order that the proceedings otherwise be dismissed. (3)I order that there be no order as to costs of today. (4)I order otherwise that the plaintiff pay the defendants' costs of the proceedings.