Apple Communications v Optus Mobile [2001] NSWSC 635

Apple Communications v Optus Mobile [2001] NSWSC 635

The second notice of termination was effective because clause 17.3 allowed Optus to terminate for any reason on 30 days' written notice, and terminating to implement a genuine change to distribution arrangements was not shown to be arbitrary, capricious, for an extraneous purpose, or in breach of an implied good faith term. The proposed extant-reason implied term was not made out because the contract was clear and effective without it and it did not go without saying. No estoppel arose because the necessary shared assumption was not proved.

Jurisdiction
Australia
Judgment Date
26 July 2001
Procedural Posture
Contract Proceedings Concerning Termination of a Distribution Agreement and Cross Claim for Declaratory Relief / Judgment After Hearing on Validity of Second Notice of Termination
Outcome
Apple's claim, so far as based on the second notice of termination, failed; Optus was entitled to declaratory relief on the cross-claim.
Legal Topics
['implied Terms' 'good Faith' 'contractual Termination' 'estoppel by Convention' 'estoppel in Pais']
['contract Law' 'equity'] ['implied Terms' 'good Faith' 'contractual Termination' 'estoppel by Convention' 'estoppel in Pais']

Case Brief

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Procedural Posture

Contract Proceedings Concerning Termination of a Distribution Agreement and Cross Claim for Declaratory Relief / Judgment After Hearing on Validity of Second Notice of Termination

Legal Issues

  1. 1 ['Whether Optus validly terminated the distribution agreement by the notice served on 28 June 2001 pursuant to clause 17.3.' 'Whether clause 17.3 was subject to an implied term that the power to terminate could be exercised only in good faith and fairly and not capriciously, arbitrarily or for an extraneous purpose.' "Whether there was an implied term that clause 17.3 could not be exercised for a reason in Optus's contemplation as at 23 November 2000 and not communicated to Apple." 'Whether Optus was estopped from relying on the second notice of termination.']

Ratio Decidendi

The second notice of termination was effective because clause 17.3 allowed Optus to terminate for any reason on 30 days' written notice, and terminating to implement a genuine change to distribution arrangements was not shown to be arbitrary, capricious, for an extraneous purpose, or in breach of an implied good faith term. The proposed extant-reason implied term was not made out because the contract was clear and effective without it and it did not go without saying. No estoppel arose because the necessary shared assumption was not proved.

Court Disposition

Apple's claim, so far as based on the second notice of termination, failed; Optus was entitled to declaratory relief on the cross-claim.

Orders

  • ['The defendants are entitled to a declaration on the cross-claim that upon the expiry of thirty days from service of the second notice of termination, the agency agreement will be terminated.' 'The Court will hear argument on whether any declarations are required concerning the first notice of termination and on...