FEDERAL COURT OF AUSTRALIA
Ali v Collection Point Pty Ltd [2011] FCAFC 87
Citation: Ali v Collection Point Pty Ltd [2011] FCAFC 87 Appeal from: Ali v Collection Point Pty Ltd, in the matter of Collection Point Pty Ltd (No 3) [2010] FCA 1176 Parties: HURKAN (HARRY) ALI v COLLECTION POINT PTY LTD (ACN 079 904 984), ZACXAN PTY LTD (ACN 116 472 710) and ANTONIO BULZOMI; ZACXAN PTY LTD (ACN 116 472 710) and ANTONIO BULZOMI; HURKAN (HARRY) ALI File number: VID 993 of 2010 Judges: RARES, FOSTER AND DODDS-STREETON JJ Date of judgment: 15 July 2011 Catchwords: CONTEMPT OF COURT – Appeal – Whether primary judge erred in finding appellant guilty of contempt of orders requiring delivery up and destruction of computer files – Whether open on evidence to find deliberate breach beyond reasonable doubt – Whether excessive penalty imposed
COSTS – Whether primary judge erred in failing to award respondents’ costs on indemnity basis
Cases cited: Australian Competition and Consumer Commission v Allergy Pathway Pty Ltd (No 2) (2011) 192 FCR 34 distinguished
Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 discussed
Barca v R (1975) 133 CLR 82 cited
Bovis Lend Lease Pty Ltd v Construction Forestry Mining and Energy Union (No 2) [2009] FCA 650 cited
Construction Forestry Mining and Energy Union v BHP Steel (AIS) Pty Ltd (2003) 196 ALR 350 discussed
Fox v Percy (2003) 214 CLR 118 cited
Hearne v Street (2008) 235 CLR 125 cited
House v R (1936) 55 CLR 499 cited
Lukatela v Birch (2008) 223 FLR 1, 164 ACTR 24 cited
Markarian v The Queen (2005) 228 CLR 357 cited
Metcash Trading Limited v Bunn (No 6) [2009] FCA 266 cited
R v Hillier (2007) 228 CLR 618 cited
R v Williscroft & Ors [1975] VR 292 cited
State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (in liq) & Ors (1999) 73 ALJR 306 cited
Wong v The Queen; Leung v The Queen (2001) 207 CLR 584 citedDate of hearing: 25 May 2011 Date of last submissions: 25 May 2011 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 86 Counsel for the Appellant/Cross Respondent: Mr J Twigg Solicitor for the Appellant/Cross Respondent: Vadarlis & Associates Counsel for the First Respondent: The First Respondent did not appear Counsel for the Second and Third Respondents/Cross Appellants: Mr M Bevan-John Solicitor for the Second and Third Respondents/Cross Appellants: Christopher Bunnett, Lawyers
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 993 of 2010
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN: HURKAN (HARRY) ALI
Appellant/Cross RespondentAND: COLLECTION POINT PTY LTD (ACN 079 904 984)
First RespondentZACXAN PTY LTD (ACN 116 472 710)
Second Respondent/First Cross-AppellantANTONIO BULZOMI
Third Respondent/Second Cross-Appellant
JUDGES:
RARES, FOSTER AND DODDS-STREETON JJ
DATE OF ORDER:
15 JULY 2011
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.The appeal be dismissed with costs.
2.The cross-appeal be dismissed with costs.
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Details
- AGLC
- Ali v Collection Point Pty Ltd [2011] FCAFC 87
- Case
- [2011] FCAFC 87
- Decision Date
CaseChat Overview and Summary
In the case of Ali v Collection Point Pty Ltd, the appellant, Mr Ali, was found guilty of contempt by the primary judge for failing to comply with court orders that required him to deliver up and subsequently destroy certain computer files. These files belonged to Collection Point Pty Ltd and two other entities, ZacXan Pty Ltd and T Bulzomi Financial and Legal Services. The primary judge's decision was based on evidence that Mr Ali had copied these files onto a CD and retained them in his possession despite the court orders. The appeal against this finding of contempt was dismissed, as was the cross-appeal concerning the costs.
The legal issues that the court was required to address included whether the primary judge erred in finding Mr Ali guilty of contempt given the evidence presented, and whether the penalty imposed was excessive. Additionally, the court considered whether the primary judge had erred in not awarding the respondents' costs on an indemnity basis. The court found that the primary judge was correct in her assessment that Mr Ali had deliberately breached the court orders, and that the penalty was not excessive given the nature of the breach. The court also found no error in the primary judge's decision on costs.
The court's reasoning was based on the evidence provided, including the content of the CD found in Mr Ali's possession, which contained the files in question. The court noted that Mr Ali had initially denied having these files but later admitted to copying them. The court held that the evidence was sufficient to establish that Mr Ali had deliberately breached the court orders. The penalty was deemed appropriate in the circumstances, and the court found no error in the primary judge's approach to costs. The appeal and cross-appeal were therefore dismissed with costs to be borne by the appellant and the cross-appellant respectively.
The legal issues that the court was required to address included whether the primary judge erred in finding Mr Ali guilty of contempt given the evidence presented, and whether the penalty imposed was excessive. Additionally, the court considered whether the primary judge had erred in not awarding the respondents' costs on an indemnity basis. The court found that the primary judge was correct in her assessment that Mr Ali had deliberately breached the court orders, and that the penalty was not excessive given the nature of the breach. The court also found no error in the primary judge's decision on costs.
The court's reasoning was based on the evidence provided, including the content of the CD found in Mr Ali's possession, which contained the files in question. The court noted that Mr Ali had initially denied having these files but later admitted to copying them. The court held that the evidence was sufficient to establish that Mr Ali had deliberately breached the court orders. The penalty was deemed appropriate in the circumstances, and the court found no error in the primary judge's approach to costs. The appeal and cross-appeal were therefore dismissed with costs to be borne by the appellant and the cross-appellant respectively.
Orders
Orders of the court
1. The appeal be dismissed with costs.
2. The cross-appeal be dismissed with costs.
Note:
Background
Background to the litigation
The primary judge published reasons on 18 October 2010 (“principal reasons”) in relation to the notice of motion and statement of charge of contempt. On 29 October 2010, her Honour heard submissions on penalty and costs and made orders in the proceeding and published reasons on the same day in relation to penalty and costs (“penalty and costs reasons”).BACKGROUND AND EVIDENCE Prior to 16 October 2009, the appellant had been employed by or “maintained an interest” in Collection Point, a company controlled by its sole director, Domenico Crupi. On 16 October 2009, the appellant ceased his employment with Collection Point. On 19 October 2009, he incorporated a company, Search Point Pty Ltd, of which he was the sole director and shareholder. On the same day, when questioned by Mr Bulzomi, who was then a consultant with Collection Point, the appellant denied that he had retained any of Collection Point’s equipment and denied that he had ever copied Collection Point’s database. The appellant (as he subsequently acknowledged in his affidavit affirmed on 16 August 2010 in the contempt proceedings), had, in fact, at an earlier stage (in July 2009) copied the Premier 12 MYOB Program folder from the Collection Point server onto a CD as a back up, which he then took home. In the contempt proceedings, he asserted that subsequently he had forgotten about this CD and that he believed his brother had removed it to his own bedroom. On 23 November 2009, Collection Point applied for delivery up of confidential information in the appellant’s possession. The appellant, by his affidavit, admitted that on 10 October 2009, contrary to his initial denial, he had copied Collection Point’s MYOB data. In his affidavit affirmed on 22 December 2009, the appellant acknowledged that on 10 October 2009, he had copied Collection Point’s File Maker Pro File. Further, as the following exchange at the hearing on 22 December 2009 between the appellant’s counsel and Mr Holdenson SC (then counsel for the defendant, Collection Point) reveals, the appellant’s counsel conceded on the appellant’s instructions that the appellant had also copied the cross‑appellants’ ZacXan and T. Bulzomi Financial and Legal Services MYOB files (“the ZacXan and Bulzomi files”) on 10 October 2009:Mr Holdenson: Does [the appellant] have or does he not have… namely, the MYOB records for entities other than the defendant? …Then there’s two items within that paragraph 20(a) of our outline, the ZacXan Pty Ltd MYOB records and T Bulzomi Financial and Legal Services MYOB records…Mr Twigg: I’m prepared to make the concessions that he has got those documents in his possession.…Mr Holdenson: Well I don’t need to ask him any questions. My friend has indicated he is about to make a concession in respect of 20(a).Mr Twigg: I do concede… On 22 December 2009, her Honour made, inter alia, the December orders, which were relevantly as follows:4.By no later than 4:00pm 24 December 2009, the plaintiff provide to the Court (and the independent person once they are appointed), and otherwise destroy and confirm on oath:(a)the File Maker Pro program and data files of the defendant; and(b)the MYOB data files of the defendant.5.By no later than 4:00pm 24 December 2009, the plaintiff provide to the Court and the independent person (once they are appointed), and otherwise destroy and confirm on oath:(a)the MYOB data files of Zacxan Pty Ltd; and (b)the MYOB data files of T Bulzomi Financial and Legal Services.6.By no later than 4:00pm 24 December 2009, the defendant provide to the Court a copy of:(a)the File Maker Pro program and data files of the defendant; (b)the MYOB data files of the defendant; (c)the MYOB data files of Zacxan Pty Ltd; and(d)the MYOB data files of T Bulzomi Financial and Legal Services.
Evidence
Evidence Before The Court
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Decision
Reasons for decision
Notwithstanding the above testimony, on 11 October 2010 the appellant also maintained that he downloaded the MYOB program files on the CD on a Saturday night in early 2009 completely unaware that the folder (Premium 12) contained data of T Bulzomi Financial and Legal Services and ZacXan, and “only found out I had those files on 3 August [2010] at 9.30am”. THE JUDGMENT BELOWThe principal reasons In the principal reasons, the primary judge set out the legal principles relevant to contempt at [9] to [13]. Her Honour recited the background facts at [15] to [25] and observed (at [24] to [26]):During the search of Mr Ali’s residential premises, a CD bearing no handwritten annotation, but containing a number of files, was located in a box of other computer disks in the bedroom of Mr Ali’s brother. Two of the files on the CD were MYOB files of ZacXan Pty Ltd and T Bulzomi Financial and Legal Services together with two enabling files required to run the two MYOB files (the CD).At the hearing of the Notice of Motion for his punishment for contempt, Mr Ali admitted the following facts:…3. the CD found at his residential premises did contain MYOB files of ZacXan Pty Ltd and T Bulzomi Financial and Legal Services together with two enabling files required to run the two MYOB files; and4. he had copied the information on to the CD from the defendant’s server one Saturday night in early 2009.Mr Ali’s evidence was that (1) he did not know when the CD was last in his possession, (2) he did not recall seeing the CD when he destroyed the other materials in December 2009 or in April 2010 when the issue was again raised and (3) it had completely slipped his mind that the CD existed and had information on it from the defendant’s computers… Her Honour set out paras 33 to 36 of the appellant’s affidavit affirmed on 16 August 2010. Her Honour dismissed the appellant’s contention that she could not be satisfied beyond reasonable doubt of his breach of the December orders, stating at [45]:The first issue raised by Mr Ali — that I could not be satisfied beyond reasonable doubt that there had been non compliance with the December 2009 Order — was based on the contention that the CD seized during the execution of the search order was not before the court. The issue arose because in response to a notice to produce directed to the defendant’s solicitors to produce the CD seized during the execution of the search order, the solicitors produced a CD bearing the words “Ferrier Hodgson”. On no view was that the CD seized during execution of the search order. In the end, I do not accept that the failure of the Bulzomi Interests to tender the CD seized during execution of the search order is fatal. The reason for that conclusion is simple. Exhibited to the affidavit sworn on 16 August 2010 by Mr Ali was a copy of the index to the CD seized during the execution of the search order. That exhibit lists the following files as being part of the files contained on the CD:
Ratio Decidendi
Legal Principle Established
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