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Court in the Act
18 August, 2004  
Sweeney company in dot com dot au brawl

Charles Sweeney’s dot com dust-up in the Federal Court … Jeff Spender clipped on the ear by Full Court over excessive delay in Danny Hill case. Ginger Snatch reports


image Poor Charles Sweeney – he just can’t seem to take a trick.

Just recently the Industrial Relations Commission refused his application for interlocutory orders to protect the quiet enjoyment of his digs at St James Hall in the Street of Shattered Dreams.

See story

Now the Federal Court has delivered a cruel blow to Capital Networks Pty Ltd, of which Sweeney is a director. The company is a relatively new player in the domain name registration caper and among other things its mission is to provide web-hosting services for Heard and McDonald Islands.

Unfortunately, the industry regulator .au Domain Administration Limited wasn’t too impressed with Capnet’s brief performance history. It received a volume of complaints, including some from the Australian Competition and Consumer Commission that Capnet refused to transfer domain names to other registrars and placed onerous conditions on people wishing to do so.

The regulator wrote to Sweeney at Capnet seeking information and explanation. When the company didn’t provide either, auDA threatened to suspend the company’s accreditation within 30 days. This still did not produce the desired response on Capnet’s part.

At the eleventh hour, Sweeney hotfooted it off to the Federal Court where Justice Gyles granted Capnet an interlocutory injunction against suspension or termination. Capnet alleged the regulator had engaged in conduct that was misleading and deceptive and breached the Trade Practices Act.

Later the sorry saga came before Justice Annabelle Bennett who found no such thing, throwing Capnet’s main submissions out the window and saying the regulator was entitled to suspend its accreditation under the registrar agreement. Furthermore, its conduct was “not misleading or deceptive and there was no contravention of the TPA”.

Bennett noted that the evidence of Chris Disspain, the regulator’s CEO was unchallenged:

“Given that a number of people within Australia have made complaint to auDA in relation to the applicants activities (including activities in the gTLD domain space [generic top level domains]), I believe that the activities of the Applicant leading to the complaints may either amount to a breach of the law (in breach of the Registrar Agreement), and/or bring auDA into disrepute. It is also my view that, in light of this risk, the information that auDA requested the applicant to provide was reasonable.”

Capnet was ordered to pay the regulator’s costs of both hearings.

This awful state of affairs must have been resolved to some extent because Capnet is still listed as one of auDA’s registered .au domain name providers.

Justice Spender spends [more than] a little time

Brizzie’s Federal Court Justice Jeff Spender has come in for a bit of flak from the Full Court over the time he took to deliver his judgment in a property dispute.

In Expectation Pty Ltd v PRD Realty Pty and Gordon Douglas, Carr, Emmett & Gyles JJ described the 22 months from trial’s end to judgment day as an “excessive delay”.

Expectation is the trustee of the Daisy Hill Family Trust, but the central figure in the proceedings is Daisy’s husband Danny Hill, the Western Australian entrepreneur. The applicant’s counsel described him as a “serious and well-heeled investor”.

Expectation sued PRD Realty over contracts to buy a Gold Coast shopping centre, Benowa Gardens. The purchaser suffered a loss following a lower valuation than had been represented by the selling agent. The applicant sued for damages, including damages based on the assertion that if it had not purchased Benowa Gardens it would have invested in another project and thereby it has lost the benefit of that investment.

Expectation had a partial success in its appeal from Spender’s findings.

The delay of almost two years along with his Honour’s “unsatisfactory reasons” for dismissing Expectation’s case was a central plank of the appeal, which was partly upheld.

Wayne Martin for the Hill interests claimed that:

“Any advantage that his Honour would have had through seeing and hearing the witnesses was lost. Specifically, critical findings based on the demeanour of the witnesses Messrs Hill and McLernon (both directors of Expectation) were suspect, since they were made almost two years after those witnesses gave their evidence.”

The Full Court’s comments about the tardiness of judges in general and Spender in particular, showed it was in complete agreement.

“The mere fact of a long delay itself weakens a trial judges advantage In the normal course, statements made by a trial judge of a general assertive character can be accepted as encompassing a detailed consideration of the evidence. However, where there is significant delay, such statements should be treated with some reserve

almost seventeen months expired between the time when his Honour reserved judgment (16 October 2001) and 11 March 2003, the date upon which he delivered his first set of reasons and more than 21 months between the completion of evidence and the first set of reasons

The delay in the present case went beyond the minimum period of ‘operative delay’. In those circumstances, in his reasons for judgment his Honour was required to carry out a detailed consideration i.e. a more comprehensive statement of the relevant evidence (to use the words of the Court of Criminal Appeal in Maxwell) ?? than would normally be required. The purpose of doing so would have been to demonstrate to all concerned that the delay had not affected his decision.”

Sadly the court found Jeff Spender wanting in this respect, concluding:

“much of the reasoning of the primary judge cannot be supported.”

The court ordered a new trial of part of the case – without Spender J.