Device Technologies Australia Pty Ltd v Applied Medical International Inc and Anor [2001] NSWSC 1110

Device Technologies Australia Pty Ltd v Applied Medical International Inc and Anor [2001] NSWSC 1110

No exclusive distribution contract was implied from the parties' post-1994 dealings because AMI had offered exclusivity only on the terms of a formal written agreement that DTA rejected, the later dealings were consistent with a mutually convenient business relationship rather than legal obligation, and both parties believed no contract existed. The alleged oral three-year contract was not proved: the Court accepted Mr Molloy's evidence, rejected the evidence of Messrs Ord and Ryan, and found it inherently improbable that experienced commercial parties would intend to bind AMI immediately to a substantial exclusive distribution arrangement without agreed essential terms and before a...

Jurisdiction
Australia
Judgment Date
06 December 2001
Procedural Posture
Commercial Proceedings Concerning Alleged Exclusive Distribution Contract, Trade Practices Act Claims, Inducement of Breach of Contract, and Cross Claim for Debt / Final Judgment After Hearing
Outcome
Plaintiff's claims dismissed with costs; judgment for AMI on the Amended Cross Claim.
Legal Topics
['informal Contract by Course of Conduct' 'oral Contract' 'exclusive Distribution' 'repudiation' 'misleading or Deceptive Conduct' 'procuring Breach of Contract' 'set Off' 'debt for Goods Sold and Delivered']
['contract Law' 'trade Practices' 'commercial Law'] ['informal Contract by Course of Conduct' 'oral Contract' 'exclusive Distribution' 'repudiation' 'misleading or Deceptive Conduct' 'procuring Breach of Contract' 'set Off' 'debt for Goods Sold and Delivered']

Case Brief

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Procedural Posture

Commercial Proceedings Concerning Alleged Exclusive Distribution Contract, Trade Practices Act Claims, Inducement of Breach of Contract, and Cross Claim for Debt / Final Judgment After Hearing

Legal Issues

  1. 1 ["Whether, immediately prior to 15 December 1999, there was a contract between DTA and AMI for exclusive distribution by DTA of AMI's products in Australia, terminable by AMI only on reasonable notice." 'Whether reasonable notice of termination was given if such a contract existed.' "Whether an immediately binding contract came into existence on 15 December 1999 giving DTA exclusive distribution rights in Australia for AMI's products, including general surgery products, for three years." "Whether AMI represented to DTA on and after 15 December 1999 that DTA would continue to be AMI's exclusive distributor for general surgery products for three years and whether DTA relied on that representation." 'Whether Gembro was sufficiently aware of any exclusive distribution contract, or recklessly indifferent to its terms, so as to be liable for procuring breach of contract.' 'If liability were established, what damages were payable.' "Whether DTA could set off AMI's cross-claim debt against any damages liability of AMI."]

Ratio Decidendi

No exclusive distribution contract was implied from the parties' post-1994 dealings because AMI had offered exclusivity only on the terms of a formal written agreement that DTA rejected, the later dealings were consistent with a mutually convenient business relationship rather than legal obligation, and both parties believed no contract existed. The alleged oral three-year contract was not proved: the Court accepted Mr Molloy's evidence, rejected the evidence of Messrs Ord and Ryan, and found it inherently improbable that experienced commercial parties would intend to bind AMI immediately to a substantial exclusive distribution arrangement without agreed essential terms and before a...

Court Disposition

Plaintiff's claims dismissed with costs; judgment for AMI on the Amended Cross Claim.

Orders

  • ["The Plaintiff's Summons is dismissed." 'Judgment for the Cross Claimant on the Amended Cross Claim in the sum of USD111,280.86.' "Order that the Plaintiff pay the Defendants' costs of the proceedings." 'Exhibits may be returned.']