INTELACT LIMITED v FONTERRA TM LIMITED [2017] NZHC 1086

INTELACT LIMITED v FONTERRA TM LIMITED [2017] NZHC 1086

The Court held the settlement agreement was a full and final settlement that discharged the plaintiffs' 2014 causes of action (an accord and satisfaction), clause 8 was an unenforceable agreement to negotiate for lack of certainty and thus could not preserve the plaintiffs' original claims, s93 of the Trade Marks Act provided a defence as to use of a registered mark, and the plaintiffs had not validly made time of the essence to cancel; accordingly the amended statement of claim was struck out and summary judgment entered for the defendants.

Citation
[2017] NZHC 1086
Parties
First Plaintiff/first Respondent: Intelact Limited; Second Plaintiff/second Respondent: Nutrinza Limited; First Defendant/first Applicant: Fonterra TM Limited; Second Defendant/second Applicant: RD1 Limited
Court
High Court
Jurisdiction
New Zealand
Judgment Date
6 June 2017
Procedural Posture
Civil Commercial Litigation: Settlement Dispute and Trade Mark Claims / Interlocutory Application for Strike Out and Summary Judgment
Outcome
Amended statement of claim struck out; summary judgment entered for defendants; plaintiffs' proceedings dismissed
Legal Topics
Settlement Agreement Interpretation, Accord and Satisfaction, Agreement to Negotiate / Best Endeavours, Strike Out (r 15.1), Summary Judgment (r 12.2), Trade Marks Act S93 Defence, Contractual Remedies Act Cancellation, Without Prejudice/mediation Evidence (evidence Act S57)
Contract Law Intellectual Property Trade Mark Law Civil Procedure Evidence Law Settlement Agreement Interpretation Accord and Satisfaction Agreement to Negotiate / Best Endeavours +5 more

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Parties

Intelact Limited

First Plaintiff/first Respondent

Nutrinza Limited

Second Plaintiff/second Respondent

Fonterra TM Limited

First Defendant/first Applicant

RD1 Limited

Second Defendant/second Applicant

Procedural Posture

Civil Commercial Litigation: Settlement Dispute and Trade Mark Claims / Interlocutory Application for Strike Out and Summary Judgment

Legal Issues

  1. 1 Whether the settlement agreement operated to discharge the plaintiffs' causes of action in the 2014 proceedings or left them capable of revival if clause 8 obligations were not performed
  2. 2 Whether clause 12 made the full and final settlement conditional on successful performance of clause 8
  3. 3 Whether clause 8 (an obligation to use best endeavours and negotiate in good faith to reach a toll manufacturing agreement) is enforceable or void for uncertainty

Ratio Decidendi

The Court held the settlement agreement was a full and final settlement that discharged the plaintiffs' 2014 causes of action (an accord and satisfaction), clause 8 was an unenforceable agreement to negotiate for lack of certainty and thus could not preserve the plaintiffs' original claims, s93 of the Trade Marks Act provided a defence as to use of a registered mark, and the plaintiffs had not validly made time of the essence to cancel; accordingly the amended statement of claim was struck out and summary judgment entered for the defendants.

Court Disposition

Amended statement of claim struck out; summary judgment entered for defendants; plaintiffs' proceedings dismissed

Orders

  • Amended statement of claim struck out
  • Summary judgment entered for Fonterra TM Limited and RD1 Limited