Dimmi v RestaurantDiary.com [2018] NSWSC 846

Dimmi v RestaurantDiary.com [2018] NSWSC 846

The contractual right to terminate exclusivity was not enlivened because the KPI targets were set by reference to treating the cost of Dimmi Rewards as a cost of sales, not as an offset against revenue. Performance must be assessed on the same accounting basis as the targets were set, and subsequent accounting advice did not retrospectively alter this. Therefore, the purported termination notice was invalid.

Jurisdiction
Australia
Judgment Date
07 June 2018
Procedural Posture
Contract/commercial Dispute / Trial Judgment
Outcome
Plaintiff’s claim upheld; declaration and injunctive relief granted.
Legal Topics
['termination of Contract' 'key Performance Indicators (kpi)' 'exclusive Licence' 'estoppel' 'accounting Treatment in Commercial Contracts']
['contract Law' 'equity'] ['termination of Contract' 'key Performance Indicators (kpi)' 'exclusive Licence' 'estoppel' 'accounting Treatment in Commercial Contracts']

Case Brief

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Procedural Posture

Contract/commercial Dispute / Trial Judgment

Legal Issues

  1. 1 ['Whether the termination of exclusivity provisions under the licence agreement was valid' 'Whether the right to terminate was enlivened if KPI targets were not met' 'Whether Dimmi met the Revenue KPI Target for September 2015 quarter' 'Whether cost of Dimmi Rewards should be offset against revenue or treated as a cost of sales' 'Whether parties adopted a common assumption about revenue calculation for KPIs' 'Whether loss of the opportunity to act differently, if assumption was untrue, would constitute detriment']

Ratio Decidendi

The contractual right to terminate exclusivity was not enlivened because the KPI targets were set by reference to treating the cost of Dimmi Rewards as a cost of sales, not as an offset against revenue. Performance must be assessed on the same accounting basis as the targets were set, and subsequent accounting advice did not retrospectively alter this. Therefore, the purported termination notice was invalid.

Court Disposition

Plaintiff’s claim upheld; declaration and injunctive relief granted.

Orders

  • ['Declare that the plaintiff met the KPI Targets for the quarter ended 30 September 2015 under the licence agreement.' 'Declare the defendant’s notice of termination dated 31 May 2017 is invalid.' 'Order that the defendant be restrained during the continuance of the Licence Agreement from granting, without the...