The High Court has dismissed the Commerce Commission's application for an interim injunction against Viagogo on the basis that it does not have jurisdiction until Viagogo has been served. Consumers will need to remain vigilant for the time being.
The Commerce Commission applied to the Court for orders prohibiting Viagogo from making specific representations on its website about:
(a) the number of tickets available;
(b) the likelihood of the tickets selling quickly; and
(c) the validity of tickets.
The application was made without service being effected on Viagogo, as the Commerce Commission was concerned about the delay that would result if Viagogo was permitted to keep making these representations for the six months until service could be completed.
The Court held that the lack of service on Viagogo, notwithstanding that Viagogo and its lawyers were aware of the proceeding, meant that the Court did not have jurisdiction to determine the application.
With one exception, New Zealand Courts have consistently declined to determine interlocutory applications, including those for interim relief, where overseas defendants have objected to jurisdiction until the issue of jurisdiction is resolved. This is essentially because there is no obligation, nor a right, to file an objection to jurisdiction until service has been effected under the High Court Rules.
In the present case, the Court was not persuaded by the Commission's argument that the conduct complained of occurred in New Zealand (such that jurisdiction was not at issue), on the basis that section 3 of the Fair Trading Act specifically confers jurisdiction. Nor was the Court persuaded by the argument that Viagogo had known of these proceedings for some months, and had taken no steps other than to insist on formal service in Switzerland.
The Court agreed with Viagogo's lawyers that the fact that the Fair Trading Act might confer jurisdiction to grant relief in respect of acts done by Viagogo in New Zealand does not in itself create jurisdiction for a Court to deal with an application for interim relief. A party is brought within the jurisdiction of the New Zealand Courts by being served in qualifying circumstances, and the mere fact that proceedings could take place in New Zealand is not enough to bring a defendant who has not been served within the jurisdiction of the Court.
The Court did not, however, exclude circumstances of true urgency where formal service cannot be effected before an application is dealt with. In those circumstances the Court noted that the plaintiff could use the provision for substituted service, which had not been done in this case.
Accordingly, Viagogo is not going to be subject to any Court-imposed restrictions on the representations it can make in the near future. Whether Viagogo's conduct is compliant with the Fair Trading Act will be a question for another day, once the Commission has formally served it with the proceeding.
If you would like to discuss any of the matters raised in this article, please contact the authors or your usual Bell Gully advisor.
This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.