Macquarie Telecom Pty Ltd v City Hunter Pty Ltd [2014] NSWDC 278

District Court New South Wales

Medium Neutral Citation: Macquarie Telecom Pty Ltd v City Hunter Pty Ltd [2014] NSWDC 278 Hearing dates: 19 May 2014 - 21 May 2014 and 24 July 2014 Decision date: 31 October 2014 Jurisdiction: Civil Before: Cogswell SC DCJ Decision: The Court answers the questions raised in the agreed statement of issues as follows: Issue 1: Whether the plaintiff repudiated the written agreement entered between the plaintiff and the defendant on 29 November 2010 for the provision of hosting services (Agreement) on 5 July 2011? Answer: No. Issue 2: If the answer to issue 1 is "yes", whether the defendant accepted the plaintiff's repudiation on 30 August 2011? Answer: Not applicable. Issue 3: Whether the defendant repudiated the agreement on 16 August 2011 or 30 August 2011? Answer: Yes. Issue 4: If the answer to issue 3 is "yes", whether the plaintiff accepted the defendant's repudiation of the agreement on 31 August 2011 or 20 September 2011? Answer: Yes. Issue 5: If the answer to issue 4 is "yes", whether the plaintiff is entitled to recover early termination charges under the agreement? Answer: Yes. Issue 6: If the answer to issue 5 is "yes", what is the quantum of the early termination charges payable by the defendant? Answer: The early termination charges payable by the defendant should include GST. Issue 7: If the answer to issue 6 is "no", whether the plaintiff is entitled to recover loss of bargain damages? Answer: If the Court's finding regarding the early termination charges payable, the plaintiff must be entitled to loss of bargain damages. Issue 8: If the answer to issue 7 is "yes", what is the quantum of damages payable by the defendant? Answer: $296,101.80. Issue 9: Whether the evidence objected to by the defendant in MFI 3 and admitted on the voir dire is admissible? Answer: Evidence of any prior dealings which concern the earlier agreement and which is the subject of MFI 3 is inadmissible and the defendant is estopped from denying that the unpaid invoices are payable by it. Catchwords: CIVIL LAW - contract - outstanding payment - repudiation of contract - acceptance of repudiation - terms of agreement - early termination charges - distinction between penalty and pre-estimate of liquidated damages - stipulated sum not "extravagant or unconscionable" - quantum of charges to include GST - alternate entitlement to loss of bargain damages - admissibility of evidence - statement of issues Legislation Cited: Goods and Services Tax Ruling 2001/4, par 73 Cases Cited: Andrews v Australia and New Zealand Bank Ltd [2012] HCA 30; 247 CLR 205 Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 Paciocco and Speedy Development Group Pty Ltd v Australia and New Zealand Banking Group Ltd [2004] FCA 35 Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656 Category: Principal judgment Parties: Macquarie Telecom Pty Ltd (plaintiff) City Hunter Pty Ltd (defendant) Representation: Counsel: C Bova (plaintiff) A-M Chee (defendant)