Federal Court of Australia

ParcelTools Pty Ltd v Method Industries Pty Ltd [2026] FCA 322

ORDERS

THE COURT ORDERS THAT:

1.    The matter is referred to a mediation to take place before a registrar of the Court.

2.    Until the earlier of:

(a)    4.00 pm AEDT on the seventh business day after the conclusion of a mediation between the parties before a registrar of the Court;

(b)    further written agreement of the parties; or

(c)    further order of the Court;

the First Respondent, by itself, its servants, or agents, is restrained from:

(d)    taking any action to terminate, suspend, or otherwise prevent the Applicant having access to the “CubeIQ” system;

(e)    disabling, altering, or transferring any existing CubeIQ customer installation.

3.    Costs of the application for interlocutory relief be costs in the cause.

THE COURT NOTES THAT:

4.    The Applicant by its counsel gives the usual undertaking as to damages for the relief granted in Order 2.

5.    By consent, and without admissions, the Applicant and First Respondent undertake to the Court that, until further order, they shall not by their servants or agents:

(a)    make statements intended to disparage the other party’s business or damage the other party’s brand, provided that for the avoidance of doubt, nothing in this note prevents either party from:

(i)    communicating with customers in the ordinary course of business;

(ii)    developing, marketing, or supplying other software products or services; or

(iii)    making statements reasonably necessary to comply with legal or regulatory obligations.

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 transcript

JACKMAN J

1    The applicant (ParcelTools) is engaged in the development of logistics dimensioning in freight measurement technology and software used within the logistics freight warehousing industry and supply chain industry. Its directors are Mr Bauer, and Mr Levisohn. ParcelTools has developed and owns technology known as “Cubetape”, which is a digital tape measure product that is capable of digitally measuring parcels and freight and calculating dimensional data.

2    The first respondent (Method) similarly works in the logistics and supply chain industry, focused on distributing technology and developing software within the areas of management, planning and productivity. It sells a product known as CubeIQ. The second respondent,
Mr Sutton, is a director of Method.

3    According to Mr Bauer, in about September 2021, Mr Bauer, Mr Levisohn, and Mr Sutton agreed for ParcelTools and Method to enter into a joint venture, the terms of which were:

(a)    Cubetape would be complemented by software to be contributed by Method; and

(b)    The product to be developed would be marketed and sold to consumers through a proposed company, which would be owned by ParcelTools and Method, (or their respective nominees) in 50:50 shares (the Joint Venture).

4    Although it was never incorporated, the proposed company was to be named “Dexter” and the final product that was the subject of the joint venture was named “CubeIQ”.

5    The CubeIQ product is comprised of two primary components, with the first being the
“Cubetape” hardware which was created and contributed to the proposed joint venture by ParcelTools, and the second being the software which allows data collected by Cubetape to be accessed and utilised on a user interface such as Android, IOS, and so on, at least according to Mr Bauer.

6    The proceedings were commenced by a concise statement alleging a breach of the joint venture agreement and in the alternative alleging misleading or deceptive conduct by Method and Mr Sutton, in allegedly representing that the joint venture was or would become legally binding, in contravention of the Australian Consumer Law. There is a further basis on which ParcelTools proposes to claim against Method when it ultimately pleads its case by statement of claim, which is not raised in its concise statement, by reference to a fiduciary relationship arising between prospective participants to a joint venture, even prior to the express definition of their relationship by formal agreement, along the lines of that considered in United Dominions Corp Ltd v Brian Pty Ltd [1985] HCA 49; (1985) 157 CLR 1. A critical factual question in such an allegation would be whether the parties implicitly or explicitly undertook to use their resources and powers only in the joint interests or benefit of the venture or proposed venture. A further critical question would be whether there was a binding contract between the parties, particularly in light of the reasoning of the High Court in John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd [2010] HCA 19; (2010) 241 CLR 1 at [91] to the effect that a fiduciary relationship cannot be superimposed upon a contract in such a way as to alter the operation which the contract was intended to have according to its true construction.

7    On 25 September 2021, a draft shareholders’ agreement relating to a proposed company to be owned equally by ParcelTools and Method in 50:50 shares was circulated. In March 2022, a heads of agreement referring to the 50:50 equity of the parties was circulated. Also in March 2022, a further heads of agreement, which again referred to the 50:50 equity of the parties, was circulated. ParcelTools does not contend that the heads of agreement were intended to have legal effect. In 2022, a document entitled “Software Overview” relating to Quanta was circulated, including “Cubetape Scanner-Dimensioner” as an “Input Method” and “Cubetape ‘Butt’ Measurement” as an “Optional Data Item”. In June 2023, a document entitled “Dexter Structure and Responsibilities – Draft June 2023” was circulated, with a diagram setting up the structure of the joint venture. On 5 and 11 August 2022, Mr Sutton sent Mr Bauer and Mr Levisohn emails relating to the agreement for the joint venture, referring in the email of 11 August 2022 to “the original (long standing) MOU structure”.

8    On 4 and 5 November 2022, Mr Levisohn and Mr Sutton exchanged emails relating to the joint venture. In the email of 4 November 2022, Mr Levisohn refers to “PT’s 50% ownership”. On 8 November 2022, a document entitled “DRAFT Agreement 8 Nov 22” was circulated, which again referred to the “50:50” equity of the party. On 25 November 2022, Mr Williams of DX Delivery, a customer of ParcelTools which it introduced to the CubeIQ product, sent an email to Mr Levisohn and Mr Sutton providing feedback. In January and October 2023, Mr Sutton sent emails to Mr Bauer and Mr Levisohn referencing the proposed agreements relating to the joint venture. On 16 March 2023, the party circulated a proposed security holders’ deed in respect of a company referred to in that deed as “Dexterco Pty Ltd”.

9    Mr Sutton in his affidavit proves that on about 30 August 2023, as part of ParcelTools registering for an account on the CubeIQ platform, Mr Levisohn signed the CubeIQ application form, which required a box to be ticked, indicating that the signer
had read and reviewed Methods terms, which were able to be accessed from the form via a hyperlink. The signing log confirms that the box was ticked by Mr Levisohn when the form was signed. Those terms state, among other things, the following:

(a)    that the Software (which is defined as CubeIQ) is licensed by Method (cl 2);

(b)    all title and copyright in the Software shall at all times remain with Method
(cl 2);

(c)    Method grants a non-transferable, non-exclusive licence to install, access and use the software (cl 3);

(d)    feedback provided by the licensee will be subject to an irrevocable and perpetual licence in favour of Method (cl 2);

(e)    the licence could be terminated by Method without notice (cl 15.3) and by either party on 30 days’ notice of a material breach (cl 15.4);

(f)    the licence agreement represented the entire agreement between the parties and any amendments to it had to be made in writing (cl 16.4).

10    Mr Sutton's affidavit was served at about 1 pm today. The legal representatives of ParcelTools then worked diligently to prepare a responsive affidavit by ParcelTools solicitor, Ms Ramsey, on information and belief from Mr Levisohn, which was served at about 2.50 pm today. No objection was taken to Ms Ramsey's affidavit. Ms Ramsey proves that Mr Levisohn informed her of the following matters:

We assisted in the CubeIQ platform for the joint venture. In order to do that, we had to create an account on the CubeIQ platform. I had conversations daily with Craig Sutton about the development of the client portal and its functionality for CubeIQ. I spoke to Craig Sutton and said “I will go in and test the functionality of the system. I also need to be able to demonstrate to customers how they will create their own accounts and use the solution”. Craig Sutton said to me “I will send you a link”. I received a link and logged into the website.

11    There is further evidence given on information and belief in the affidavit, but that passage is sufficient to demonstrate that there is a real question to be tried as to whether there was an objective manifestation of consent on the part of ParcelTools to agree to the terms displayed on the platform provided by Method. One can readily envisage further questions arising as to whether, if there was indeed an objective manifestation of consent, the conversations according to Mr Levisohn (if they are ultimately accepted as true) may provide the foundation of an unconscionability case or other case for the setting aside of any agreement which might be found to have been entered into.

12    In February 2024, Mr Sutton sent an email to Mr Bauer and Mr Levisohn referencing the proposed shareholders’ agreement relating to the joint venture and advice received from Method’s solicitors. On 21 March 2024, Mr Sutton sent an email to Mr Bauer and Mr Levisohn referencing the proposed margin to be applied on sales of CubeIQ.
In about May 2024, a reconciliation was undertaken and payments were made by ParcelTools to Method in accordance with the joint venture.

13    Mr Sutton says in his affidavit that there was an exchange of emails on 10 and 11 July 2025 concerning the price by which Method would supply CubeIQ to ParcelTools as a reseller for the purposes of their proposal to a new customer referred to as Yodel. A price is given, which counsel for Method informed me was a monthly price per licence seat. That agreement appears to be the basis, in Mr Sutton's evidence, for the claimed indebtedness by ParcelTools to Method for unpaid licence fees. However, counsel for Method was only able to reach a total of about $36,000 in unpaid fees based on Mr Sutton’s evidence, rather than the amount of about $67,000 which is claimed.

14    In 2024 and 2025 a dispute arose between the parties as to the ownership and control of CubeIQ. Mr Sutton denied the existence of a joint venture and asserted the ParcelTools had no proprietary rights in CubeIQ. From about September 2025, the parties engaged solicitors who exchanged letters setting out the parties’ respective positions.

15    On 25 February 2026, Mr Sutton sent a letter to Mr Bauer and Mr Levisohn demanding payment of purported licence fees in the sum of $67,740.75 by 4 pm on 11 March 2026, failing which Method will terminate the alleged licence with immediate effect “and any permission to market, resell, facilitate, access, or use CubeIQ”. The demand referred to unpaid invoices of 12 and 30 December 2025, which are not in evidence and the basis of the calculation of the amounts has not been explained. By email dated 6 March 2026, Method through its solicitors extended the threatened termination date to 4pm today, 17 March 2026. ParcelTools responded on 5 March denying any licence arrangement and sought particulars as to the alleged licence agreement and the contractual basis on which the invoices were reportedly issued, and also referred to serious consequences for both it and customers of Method’s threat being implemented. Prior to service of Mr Sutton’s affidavit at about 1 pm today, there had not been a proper answer to ParcelTools’s request for further information.

16    In my view, there is a serious question to be tried. While ParcelTools’s claim in contract appears to me to be relatively weak at this stage, there does seem to me to be a serious question as to whether Method owed fiduciary duties to ParcelTools as an actual or potential joint venture participant to act only in their joint interests in relation to the relevant technology, and a serious question as to whether Method would be acting in breach of such a duty by implementing its threats articulated on 25 February 2026. It is not possible at this stage to identify in detail what qualifications there may be to such a duty, nor is it necessary for present purposes to do so.

17    As to the balance of convenience, ParcelTools submits, and I accept, that if Method is not restrained from carrying out its threatened action, then:

(a)    ParcelTools’s intellectual property rights (if any) associated with the Cubetape technology, which it says was only shared with Method for the purposes of the joint venture, could be improperly used by Method in taking sole control of the CubeIQ product;

(b)    Method could cause customers of the joint venture to be diverted from ParcelTools, to the irreversible detriment of ParcelTools and the joint venture;

(c)    third party customers who use the CubeIQ product would also be adversely affected
if ParcelTools is prevented from servicing those customers;

(d)    reputational harm and loss of business would likely result to ParcelTools, which would be very difficult to quantify;

(e)    ParcelTools would likely be met with claims by customers, such as DX Delivery.

18    In those circumstances, in my view, the balance of convenience favours the grant of an injunction. Accordingly, I make the orders above.

Associate:

Dated:    23 March 2026