Federal Court of Australia

Business Travel Media Pty Ltd v GroupM Communications Pty Ltd [2023] FCA 512

ORDERS

THE COURT ORDERS THAT:

1.    The applicant be granted leave to file an amended statement of claim by 5pm on 7 June 2023.

2.    The costs of today and in relation to the proposed amended statement of claim served on 11 May 2023, being costs thrown away by reason of the amendment to the statement of claim, form part of the costs order made pursuant to Order 3 of the Orders dated 24 March 2023.

3.    On or by 7 June 2023, the applicant provide a further $10,000 in security for the respondents’ costs, to be paid into the existing controlled monies account.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Delivered ex tempore, revised from the transcript)

LEE J:

1    This is the third case management hearing in this matter.

2    The background and procedural history is set out in Business Travel Media Pty Ltd v M Media Group Pty Ltd [2023] FCA 411.

3    In essence, Business Travel Media Pty Ltd (BTM) alleges that the respondents did not perform their obligations under an arrangement whereby BTM would place promotional material prepared by the respondents on its website for a fee.

4    There has been considerable confusion as to the scope of BTM’s case: see Business Travel Media (at [3]–[15]).

5    On the last occasion, I made orders directing that BTM file an amended statement of claim and pay the respondents’ costs thrown away by reason of the amendment. I explained that the orders made were an indulgence given to BTM to ensure the case it proposes to advance is made coherently, and in a way which affords procedural fairness to the respondents. Further, I indicated that if the next iteration of the statement of claim suffered from the same flaws which plagued the first version, a question may well arise as to whether it would be appropriate to allow BTM a further opportunity to re-plead: Business Travel Media (at [16]).

6    A version of an amended statement of claim was provided to the Court in advance of today’s case management hearing, albeit not in accordance with the orders made on the last occasion. It was lodged with the Court on 10 May 2023 and served on the respondents on 11 May 2023, notwithstanding that the orders provided for it to be filed on or by 5 May 2023.

7    Regrettably, the proposed pleading does little to advance matters. While it now concentrates on what is said to be the nub of the case (a claim in contract), a series of difficulties remain, in particular: (1) whether or not it is alleged there was one contract, or a series of contracts; (2) if it is alleged there was more than one contract on foot, the relationship between what might be described as the “master agreement” and any subsequent contract or contracts; and (3) the lack of specificity as to the parties to the contract or contracts. As to the third point, it is not in dispute there was a written agreement between BTM and the first respondent, GroupM Communications Pty Ltd (GroupM), but the obligations arising out of that document and the alleged relationship between BTM and the second respondent, M Media Group Pty Ltd, are presently obscure.

8    The crux of BTM’s case appears to be that there was an arrangement whereby the respondents would inform BTM of the total number of applications to purchase products received as a result of advertising on BTM’s website. BTM would then render invoices, giving rise to an obligation to pay. As I understand it, it is said that this obligation was the subject of compliance until at least 31 August 2016, but was no longer the subject of compliance after 10 November 2019. For completeness, I should note it is unclear whether the alleged obligation is said to be express or implied, or whether it is said to have arisen through oral or written communications, or a combination of both. Accordingly, it is critical that the respondents and the Court are apprised of the way in which this payment term arose, and its connexion with the written agreement between BTM and GroupM.

9    The damages claim appears to arise from the respondents’ alleged failure to comply with the obligation to pay, including by underreporting the number of applications received and consequently underpaying. While I understand BTM cannot articulate with precision the amount that is said to constitute the underpayment because of a present asymmetry of information, there does need to be clarity as to the nature of the damages claim at this stage.

10    In view of the above uncertainties, I explained to counsel for the respondents there are essentially two ways forward.

11    The first is to set the matter down for hearing as soon as practicable and resolve whether or not the contract or contracts for which BTM contends reflect the true position. In the event BTM is successful, the issue of damages could be deferred.

12    The second is to spend further time ensuring BTM’s house is in order, which may further delay the final determination of the matter. While the complaints made by the respondents to date as to the pleading have been justified, I wanted to raise what I perceive to be the shortest way home.

13    The respondents opted for the second course. Nothing I have said should be construed as being critical of that choice. It is the respondents who have suffered as a result of the lack of clarity on the part of the applicant, so I will adopt their preference and give BTM one final opportunity to put on an amended statement of claim addressing the matters that remain opaque.

14    In the light of the path taken, it is appropriate that I make orders for a further tranche of security for the respondents’ costs. In February, I made an interim order for security in the amount of $10,000: see Business Travel Media (at [17]). In all the circumstances, it is appropriate that a further order for security in the same amount be made, and that it be provided at the same time as the amended statement of claim.

Associate:

Dated:    23 May 2023