BPI Telecom Ltd v Nokia (Ireland) Ltd

JurisdictionIreland
JudgeMr. Justice Cooke
Judgment Date20 December 2012
Neutral Citation[2012] IEHC 557
CourtHigh Court
Date20 December 2012

[2012] IEHC 557

THE HIGH COURT

[No. 9498 P./2012]
BPI Telecom Ltd v Nokia (Irl) Ltd

BETWEEN

B.P.I. TELECOM LIMITED
PLAINTIFF

AND

NOKIA (IRELAND) LIMITED
DEFENDANT

COMPETITION ACT 2002 S5(2)(C)

FIRST NATIONAL COMMERCIAL BANK PLC v ANGLIN 1996 1 IR 75 1996/11/3337

AER RIANTA CPT v RYANAIR LTD 2001 4 IR 607 2002 1 ILRM 381 2001/1/68

MOOHAN & BRADLEY T/A BRADLEY CONSTRUCTION v S & R MOTORS (DONEGAL) LTD 2008 3 IR 650 2007/42/8816 2007 IEHC 435

IRISH LIFE ASSURANCE PLC v QUINN UNREP DUNNE 31.3.2009 2009/22/5439 2009 IEHC 153

WESTPARK INVESTMENTS LTD & VENCOURT LTD v LEISUREWORLD LTD & LEISUREPLEX (TALLAGHT) LTD UNREP HOGAN 31.7.2012 2012 IEHC 343

GE CAPITAL WOODCHESTER LTD & GE CAPITAL WOODCHESTER FINANCE LTD v AKTIV KAPITAL ASSET INVESTMENT LTD & AKTIV KAPITAL ASA UNREP CLARKE 19.11.2009 2009/22/5542 2009 IEHC 512

DANSKE BANK AS T/A NATIONAL IRISH BANK v DURKAN NEW HOMES & ORS UNREP SUPREME 22.4.2010 2010/10/2392 2010 IESC 22

BANK OF IRELAND v EDUCATIONAL BUILDING SOCIETY 1999 1 IR 220 1998 2 ILRM 451 1998/11/3359

PRENDERGAST v BIDDLE (ORSE MORE O'FERRALL) UNREP SUPREME 31.7.1957

PRACTICE AND PROCEDURE

Summary judgment

Claim for summary judgment for liquidated sum due and owing as outstanding balance on trading account - Plenary summons for damages for breach of distribution agreement - Direct defence - Equitable set off - Discretion of court to grant equitable set off - Factors in exercising discretion - Whether fair or reasonable probability of defendant having real or bona fide defence - Whether cross claim stemmed from same set of facts as gave rise to primary claim - Whether appropriate to exercise discretion to grant equitable set off - First National Commercial Bank v Anglin [1996] 1 IR75; Aer Rianta v Ryanair Limited [2001] 4 IR 607; Moohan v S & R Motors (Donegal) Limited [2007] IEHC 435, [2008] 3 IR 650; Irish Life Assurance pic v Quinn [2009] IEHC 153, (Unrep, Dunne J, 31/3/2009); Westpark Investments Limited and Another v Leisureworld Limited [2012] IEHC 343, (Unrep, Hogan J, 31/7/2012); GE Capital Woodchester Ltd v Aktiv Kapital Asset Investment Ltd [2009] IEHC 512, (Unrep, Clarke J, 19/11/2009); Danske Bank v Durkan New Homes [2010] IESC 22, (Unrep, Denham J, 22/4/2010); Bank of Ireland v Educational Building Society [1999] 1 IR 220; Prendergast v Biddle, (Unrep, SC, 31/7/1957) considered - Summary judgment granted less part of amount disputed in direct defence; plaintiff given leave to defend remainder of direct defence in conjunction with pursuit of claim for damages (2012/9498P - Cooke J - 20/12/2012) [2012] IEHC 557

BPI Telecom Ltd v Nokia (Ireland) Ltd

Facts: This application was brought by the defendant against the plaintiff for summary judgment in regard to their counterclaim. Proceedings were originally initiated by the plaintiff against the defendant for breach of a telecommunications device distribution agreement made in August 2002 and a collateral agreement from April 2011. The counterclaim related to the sum of €2,498,291.13 which was the balance on the trading accounts owing to the defendant when the relationship broke down.

It was the defendant's contention that the agreement between the parties outlined the permissible credit limit between the parties and as the balance between the parties was in excess in 2010, they refused to make deliveries of new stock on a number of occasions following non-compliance with their requests to reduce the balance. The plaintiff averred that they were unable to reduce the balance due to the defendant selling stock at a higher level than that which they were selling to their competitors which was a breach of the distribution and/or the collateral agreement either expressly or impliedly. The plaintiff also disputed the amount counterclaimed by the defendant estimating the amount due to be €932,818 inclusive of VAT. They attributed the higher figure counterclaimed by the defendant to have not included "sell out support" credit notes for €800,000 and €500,000 respectively owed to the plaintiff.

Held by Cooke J that in an application for summary judgment, the test to be applied is whether the respondent to the application has a fair and reasonable bon fide defence or a 'defence as such'. It was also a consideration that the plaintiff was making a claim against the defendant for general damages which they claimed would set off the defendant's claim in full. This was especially important as the plaintiff had accepted there was a balance owing to the defendant, albeit at a lower level than that claimed.

In this case, it was found that the €500,000 figure of "sell out support" was offered on the basis of the plaintiff fulfilling conditions. These conditions had not and could not been fulfilled due to the defendant putting further orders on hold shortly after the offer was made. The plaintiff could therefore not claim this amount. In relation to the €800,000 credit note, it was held that this was also offered on the fulfilment of certain conditions. Whether these conditions were fulfilled or not would require consideration at the hearing stage and so leave to defend that amount was given. Summary judgement was therefore granted for the sum of €2,498,291.13 less the €800,000 credit note which was to be contested at hearing.

In relation to the plaintiff's claim that the application should be refused on the basis they were making a claim for general damages which would offset the counterclaim in its entirety if successful, it was held that the court retained a discretion to allow the application. In this case, there was no dispute that the plaintiff had possession of highly valued stock for some time and that they were in severe financial difficulties prior to their claim being initiated. On that basis, it was held that the balance of justice dictated that the application should be allowed.

Application for summary judgment allowed for the sum of €2,498,291.13 less the €800,000 credit note.

1

1. In this action commenced by plenary summons on the 21 st September, 2012, the plaintiff claims general damages for breach of a distribution agreement made between the plaintiff and the defendant on the 6 th August, 2002, together with damages for breach of a collateral agreement alleged to have been made between the same parties in April 2011. Under that distribution agreement a commercial relationship had existed between the plaintiff and the defendant since 2002 under which the plaintiff was the non exclusive distributor of telecommunications devices (mainly mobile phone hand sets,) manufactured by the defendant. The commercial relationship was a substantial one with a turnover in purchases by the plaintiff from the defendant amounting to several million euros per annum. The plaintiff alleges that between the commencement of the relationship and the year 2010, the total value of the purchased goods was in excess of €451 million.

2

2. The motion now before the Court is an application by the defendant for summary judgment upon its counterclaim in the sum of €2,498,291.13 claimed to be due and owing by the plaintiff to the defendant as the outstanding balance on the trading account between them up the point when the relationship broke down and the plaintiff ceased to place orders and the defendant ceased to make deliveries.

3

3. The background to the litigation can be briefly described as follows. As indicated, the commercial relationship between the defendant and the plaintiff was based upon what appears to have been a standard form distribution agreement for the defendant's products containing many provisions typical of a distribution agreement between a major manufacturer of such products and its distributors. The agreement was signed on behalf of the plaintiff (then called Brightpoint (Ireland) Limited,) on 10 th July, 2002, and later accepted on the part of the defendant on 6 th August, 2002.

4

4. It is not disputed that in or about the beginning of the year 2010, the defendant complained to the plaintiff about balances outstanding upon its account in excess of the permissable credit limits and began to press for their reduction. This led to the account being "put on hold" on at least two occasions that is it say, that the defendant refused to make further deliveries or accept further orders until the outstanding credit balance was reduced to within an acceptable limit.

5

5. Because this is a motion for summary judgment upon the counterclaim for a liquidated sum, it is neither necessary nor appropriate for the Court to express any view on the issues of credibility of evidence or proof of fact which have been raised in the course of the arguments before the Court in relation to the substantive issues which will eventually be tried both on the claim and the counterclaim. It is sufficient for present purposes to record that during the course of meetings, correspondence and email exchanges throughout 2010 and 2011 complaints were made on the part of the plaintiff about the prices at which products were being offered to it by the defendant. In particular it was complained that the plaintiff's ability to reduce the outstanding balances upon its account was being thwarted by the prices at which the defendant's products were coming on to the Irish market from competing sources including, in particular, the prices at which the defendant was supplying other non-exclusive distributors of its products in the Irish market. In that regard the plaintiff proposes to rely upon specific information as to the prices upon which particular products were agreed by the defendant to be supplied to its main competitor and rival distributor Fonua Limited.

6

6. The plaintiff's claim in this action asserts that the defendant was in breach of contract in selling products to the co-distributor Fonuna Limited at unit prices...

To continue reading

Request your trial
1 cases
  • Minister for Communications, Energy & Natural Resources v Michael Wymes (a bankrupt)
    • Ireland
    • Court of Appeal (Ireland)
    • July 7, 2020
    ...J. in his judgment (paragraph 14 and the consideration within that paragraph of the decision of Dunne J. in McConnon v Zurich Bank [2012] IEHC 557, [2012] 4 IR 737). No new issue of ground has been raised by Mr. Wymes in advancing this criteria. As this is not an appeal from the Order of ......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT