Judgment: 2017-07-26 · Court archive

High Court refuses interim order over disputed farm machinery franchise

The court said the seller had not shown a strong case that the alleged three-year franchise agreement was binding, while leaving that question for the full hearing.

High Court · [2017] IEHC 507

Who, what, where, when and why

Who
  • Pöettinger Ireland Ltd
  • Pöettinger Landtechnik GmbH (Defendant)
What

The court said the seller had not shown a strong case that the alleged three-year franchise agreement was binding, while leaving that question for the full hearing.

Where

Places mentioned in the report

  • Ireland
  • Waterford
  • Tipperary
  • Kilkenny
When

Judgment:

Why

Reasons reported in the judgment

The defendants disputed that the document was authentic or binding, saying it had been signed without Pöettinger Ireland’s authority. The court did not decide whether the agreement was authentic or legally binding. It considered only whether Suirway had shown a strong case likely to succeed at trial, the standard it applied because the requested orders would require continued supply and restrain termination and the appointment of another dealer.

The High Court has refused interim injunctions sought by Unilift Ltd, trading as Suirway Farm Machinery, in a dispute over the termination of its relationship with machinery supplier Pöettinger Ireland Ltd and its Austrian parent, Pöettinger Landtechnik GmbH.

The ex tempore judgment, delivered by Mr Justice Twomey on 26 July 2017, concerns an application pending a full trial. Suirway alleged that Pöettinger Ireland wrongfully terminated a franchise agreement with immediate effect on 30 June 2017. It relied on a document dated 14 August 2013 that it said required three years’ notice and gave it exclusive dealer rights in Waterford, Tipperary and/or Kilkenny.

The defendants disputed that the document was authentic or binding, saying it had been signed without Pöettinger Ireland’s authority. The court did not decide whether the agreement was authentic or legally binding. It considered only whether Suirway had shown a strong case likely to succeed at trial, the standard it applied because the requested orders would require continued supply and restrain termination and the appointment of another dealer.

Justice Twomey found that Suirway had not met that threshold. Among the matters he cited were evidence from the defendants about their usual trading practices and the three-year notice period; the document’s format and incomplete terms; when it was first raised and produced; and emails from August and October 2013. The August emails included a message from a Pöettinger director expressing opposition to contracts and asking whether any agreement should instead be an open letter of intent. In October, the parties exchanged a draft headed “Non-Legally Binding Franchise Agreement”, which provided for six months’ notice.

The judge said the alleged August agreement was inconsistent with that later exchange and concluded that the injunction application should be refused. He also said that, even if Suirway had shown a strong case, damages would be an adequate remedy because any loss could be quantified from the earnings it said it would have made during the claimed notice period. The judgment records that Suirway did not allege that termination would put it out of business.

The ruling decides the interim application only. The dispute over the document’s authenticity and binding effect remains for the court hearing the full action.

Read the original court judgment

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