Bandaid Tyres Australia Pty Ltd v Williams
[2002] WASC 306
BANDAID TYRES AUSTRALIA PTY LTD -v- WILLIAMS [2002] WASC 306
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2002] WASC 306 | |
| Case No: | CIV:2229/2002 | 29 NOVEMBER 2002 | |
| Coram: | EM HEENAN J | 29/11/02 | |
| 10 | Judgment Part: | 1 of 1 | |
| Result: | Interlocutory injunction varied but extended Order for delivery of pleadings | ||
| B | |||
| PDF Version |
| Parties: | BANDAID TYRES AUSTRALIA PTY LTD ELISHA CLARE WILLIAMS |
Catchwords: | Interlocutory injunction Breach of copyright Misuse of confidential information Conduct of former employee Variation of Anton Piller order Application for access to documents seized under order Access refused pending further definition of issues |
Legislation: | Nil |
Case References: | Anton Piller KG v Manufacturing Processes Ltd [1976] 1 Ch 55 Bentley v Nelson [1963] WAR 89 Birch Investments Pty Ltd v Lim, unreported; SCt of WA; Library No 7396; 12 July 1988 Brink's-MAT Ltd v Elcombe [1988] 3 All ER 188 Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148 Citibank Limited v Liu [2000] NSWSC 181 Commissioner of Taxation v Ahern (1986) 87 FLR 112 Films Rover International Ltd v Cannon Film Sales Ltd [1987] 1 WLR 670 Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662 Gilbert v Endean (1878) 9 Ch D 259 Hytrac Conveyors Ltd v Conveyors International Ltd [1982] 3 All ER 415; [1983] 1 WLR 44 J L Young Manufacturing Co Ltd [1900] 2 Ch 753 Kalamazoo Pty Ltd v Compact Business Systems Pty Ltd [1990] 1 Qd R 231 Lewkowski v Bergalin Pty Ltd, unreported; FCt SCt of WA; Library No 7675; 26 May 1989 Liberty Financial Pty Ltd v Scott [2002] FCA 345 Lloyds Bowmaker Ltd v Britannia Arrow Holdings Plc [1988] 1 WLR 1337 Microsoft Corp v Goodview Electronics Pty Ltd (1999) AIPC 91 MJA Scientifics International Pty Ltd v S C Johnson & Son Pty Ltd [1998] FCA 1466 Ocular Sciences Ltd v Aspect Vision Care Ltd [1997] RPC 289 Re A Debtor [1984] 1 WALR 353; [1983] 3 All ER 545 Re Juson Pty Ltd (1992) 8 WAR 13 Sands & McDougall Pty Ltd v Robinson (1917) 23 CLR 49 Savings and Investment Bank Ltd v Gasco Investments (Netherlands) BV [1984] 1 All ER 296; [1983] 1 WLR 271 Thomas A Edison Ltd v Bullock (1913) 15 CLR 679 Wright v Gasweld (1991) 22 NSWLR 317 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
ELISHA CLARE WILLIAMS
Defendant
Catchwords:
Interlocutory injunction - Breach of copyright - Misuse of confidential information - Conduct of former employee - Variation of Anton Piller order - Application for access to documents seized under order - Access refused pending further definition of issues
Legislation:
Nil
Result:
Interlocutory injunction varied but extended
Order for delivery of pleadings
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr E W Greaves
Defendant : Mr G F McGrath
Solicitors:
Plaintiff : Mossensons
Defendant : Durack & Zilko
Case(s) referred to in judgment(s):
Anton Piller KG v Manufacturing Processes Ltd [1976] 1 Ch 55
Case(s) also cited:
Bentley v Nelson [1963] WAR 89
Birch Investments Pty Ltd v Lim, unreported; SCt of WA; Library No 7396; 12 July 1988
Brink's-MAT Ltd v Elcombe [1988] 3 All ER 188
Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148
Citibank Limited v Liu [2000] NSWSC 181
Commissioner of Taxation v Ahern (1986) 87 FLR 112
Films Rover International Ltd v Cannon Film Sales Ltd [1987] 1 WLR 670
Garrard v Email Furniture Pty Ltd (1993) 32 NSWLR 662
Gilbert v Endean (1878) 9 Ch D 259
Hytrac Conveyors Ltd v Conveyors International Ltd [1982] 3 All ER 415; [1983] 1 WLR 44
J L Young Manufacturing Co Ltd [1900] 2 Ch 753
Kalamazoo Pty Ltd v Compact Business Systems Pty Ltd [1990] 1 Qd R 231
Lewkowski v Bergalin Pty Ltd, unreported; FCt SCt of WA; Library No 7675; 26 May 1989
Liberty Financial Pty Ltd v Scott [2002] FCA 345
Lloyds Bowmaker Ltd v Britannia Arrow Holdings Plc [1988] 1 WLR 1337
(Page 3)
Microsoft Corp v Goodview Electronics Pty Ltd (1999) AIPC 91
MJA Scientifics International Pty Ltd v S C Johnson & Son Pty Ltd [1998] FCA 1466
Ocular Sciences Ltd v Aspect Vision Care Ltd [1997] RPC 289
Re A Debtor [1984] 1 WALR 353; [1983] 3 All ER 545
Re Juson Pty Ltd (1992) 8 WAR 13
Sands & McDougall Pty Ltd v Robinson (1917) 23 CLR 49
Savings and Investment Bank Ltd v Gasco Investments (Netherlands) BV [1984] 1 All ER 296; [1983] 1 WLR 271
Thomas A Edison Ltd v Bullock (1913) 15 CLR 679
Wright v Gasweld (1991) 22 NSWLR 317
(Page 4)
1 EM HEENAN J: In this action Bandaid Tyres Australia Pty Ltd as plaintiff, issued a writ of summons against its former employee, Ms Elisha Clare Williams, on 30 August. That was a generally endorsed writ announcing that the plaintiff's claim was for injunctive relief to restrain the defendant from using information in which the plaintiff holds copyright, which information was gained from the plaintiff whilst the defendant was employed by the plaintiff during the period January 2000 to January 2002. It asserted that the defendant had acted in breach of copyright and in breach of a duty to treat such information in confidence. The writ claimed an account of profits or damages, together with interest, on any sum so awarded at the rate prescribed or at such rate as the court may think fit, together with other relief.
2 Contemporaneously with the issue of the writ the plaintiff, by its solicitors, sought an ex parte interim injunction and an ex parte interim Anton Piller order directed to the defendant. These applications came on for hearing before Wheeler J on 9 September, 11 September, again on 19 September and for mention on 27 September.
3 An ex parte injunction and an ex parte interim Anton Piller order were made by her Honour on 11 September. These prohibited the defendant from undertaking any further action or conduct which might infringe the plaintiff's copyright or constitute a breach of the duty of confidentiality arising from the relationship of employment.
4 The interim Anton Piller order also authorised the plaintiff, in the company of its solicitors and an independent solicitor, to search property of the defendants and to seize documents or materials which answered the description contained in the order. Under par 1(1) of that order, the defendant was obliged to allow the plaintiffs, by their solicitors, to search the defined premises for all the documents or articles listed in the schedule to the order and to search for, inspect, photograph or photocopy other documents also contained in the schedule to the order. That schedule defines the subject matter as designs and/or patterns belonging to the plaintiff, wholly or partially completed mascots based on designs belonging to the plaintiff, materials used to make mascots based on designs belonging to the plaintiff, copies of the plaintiff's customer and price lists, and any other materials taken or copied from the plaintiff, either in breach of copyright or in breach of the defendant's duty to treat her employer's information confidentially.
5 Undertakings in respect of damages were given by the plaintiffs, and the independent solicitor also gave an undertaking to hold the documents
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- seized. The seizure was made and a number of documents and papers were taken pursuant to the terms of the injunction and are presently held in the custody of the independent solicitor, Mr Wilson. Details of the property seized, including a written list of the documents has been prepared by Mr Wilson and is annexed to the affidavit which he has filed in these proceedings. He holds them subject to undertakings which he has given to the court to abide by any orders and in the meantime to keep the documents confidential.
6 At the time of seizure the originating process, the affidavits, a copy of the Anton Piller order and the associated injunction were, of course, served upon the defendant. She has since entered an appearance in this action by solicitors. They have since filed further affidavits and have moved for the discharge of the Anton Piller order and the injunction. Programming orders were made to deal with that application to discharge the order and the injunction and they have eventually come on for hearing before me today. No point is taken on either side about the absence of a particular summons by the defendant seeking the discharge of those orders. Supplementary affidavits have been filed by the plaintiff in support of the existing orders. Today leave was granted for the plaintiff to rely on a fresh affidavit sworn by Mr Kevin McGriskin on 19 November 2002 which, against objection, I allowed to be read.
7 Several grounds are relied on by the defendant for the discharge of the injunction. It is said that there was a material nondisclosure by the plaintiffs when seeking the ex parte orders and that that of itself is grounds for setting aside such ex parte orders. It is well accepted that a material nondisclosure on an ex parte application, where the greatest of candour is called for by the applicant, may result in the discharge of an order which was made in those circumstances. In this case the allegation of nondisclosure relates to failure of the plaintiffs to produce an original or counterpart stamped copy of an agreement for sale of the business to which the goodwill, copyright and fiduciary rights over the customer lists and so on attaches. The argument, as it was developed by counsel for the defendant, proceeded on the footing that such evidence as there was of the terms of the agreement for sale by which the present plaintiff purchased that business from other vendors meant that there were inconsistencies in some of the affidavits, that there was a doubt as to whether the original document had ever been stamped and that there was no explanation for the failure to produce the original document. As to those matters, it is clear that the plaintiff cannot at the moment produce the original document - that there is reason to believe that the copies of the document which have been produced by the plaintiff and attached to the various
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- affidavits closely resemble, if they are not identical to, the original document and can be regarded as practically identical when it comes to the identification of the property purchased and sold. It is also the case that secondary evidence has been adduced pointing to the probability that the original document was submitted for the assessment of stamp duty and that stamp duty was paid.
8 In those circumstances I do not consider that there has been any nondisclosure by the plaintiff by failing to produce or account further for the absence of the original agreement for sale of the business. As that is the only ground of alleged nondisclosure, I am not satisfied that there is any reason to vary the orders because of nondisclosure.
9 It was also urged by counsel for the defendant that no case had been shown - or at least no sufficiently strong case - that copyright in the materials or other rights associated with an obligation to keep material confidential or to avoid commercial exploitation of properties or opportunities derived from the former employer, was held or enjoyed by the plaintiff. The grounds for this submission were that the documents which were in existence in connection with the sale of the business, or some of them, failed to confirm that it was Bandaid Tyres Australia Pty Ltd which was the purchaser.
10 Again, I am satisfied on the evidence that this submission must be rejected, at least at this stage of the proceedings, and that there is a serious question to be tried as to whether Bandaid Tyres Australia Pty Ltd was the purchaser of the business and has legal or equitable rights to copyright, industrial design, fiduciary duties from an ex-employee.
11 The present situation in dealing with these applications is made difficult by the lack of precision which exists on the papers at this stage of the proceedings about the exact nature of the plaintiff's claim against the defendant, the absence of a clear identification of the particular causes of action upon which the plaintiff relies, and difficulty in connecting a proprietary, equitable, contractual or other statutory right in some of the materials alleged to be in the defendant's possession with the causes of action being advanced by the plaintiff. I consider that this largely stems from the absence of formal pleadings in the action. If there were a detailed statement of claim filed by the plaintiff and a detailed defence filed by the defendant, it would be far easier to identify what is the alleged property or rights of the plaintiff which have been infringed, what are the alleged breaches of duty by the defendant and whether there are any particular and, if so, what documents or other property of the plaintiff in
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- the possession of the defendant which should immediately be returned or be made the subject of some restraining order as to their present use.
12 Despite these difficulties, I accept that there is a serious question to be tried on the plaintiff's claim that the defendant may have infringed the plaintiff's copyright and/or may have acted in breach of duty to keep confidential and avoid from exploiting information and commercial opportunities derived through her role as a former employee. Just how far those questions go and how strong the evidence is in respect to some aspects of them is difficult to discern for the reasons which I have just described.
13 Another ground relied upon by counsel for the defendant to discharge the ex parteAnton Piller order was that there was no evidence nor any basis for an inference that there was a risk of destruction of the property which had been seized from the defendant, nor for any treatment or use of it in such a way as would frustrate the proof of the plaintiff's claims, or the ultimate ascertainment of the parties' rights in this litigation. When that proposition was addressed by counsel for the plaintiff, Mr Greaves quite frankly and properly acknowledged that there was no direct evidence of the threat of destruction of the documents, but he submitted that such a threat should be inferred and that the fatal consequences of destruction, if it were to occur, was such a powerful factor that it should lead to orders being made which would eliminate any such risk at all.
14 Counsel for the plaintiff also submitted that there was conduct by the defendant which suggested that little credibility should be placed on her statements and, by inference, that she should be treated as unreliable and at risk of destroying the documents. This alleged conduct by the defendant was said to be a breach of the terms of the injunction and Anton Piller order by disclosing the existence of the orders to her mother in breach of an obligation that she was to make no disclosure of the orders to anyone other than a legal practitioner for the purposes of obtaining legal advice. I must say that I doubt very much whether, if an order had been sought in express terms prohibiting the defendant from telling her mother of the details of the injunction and the ex parte order, the court would have been disposed to make such an order in anything but the most exceptional circumstances. A disclosure to a close relative, such as a mother, in these circumstances seems to be, in every way, just keeping the matter within the family and simply taking trusted advice. I am not prepared to infer that any breach of the injunction of any significant degree has resulted from that conduct, nor to treat this incident as casting
(Page 8)
- any doubt of itself over the character of the defendant or establishing that there is some risk that she may destroy this property. At the most, the situation remains that there may be some risk that the property might be destroyed or removed simply because of its potential significance.
15 At that point the case weakens because, as matters stand, it is very difficult to appreciate what is the actual significance of the documents which have been seized and which are presently in the possession of Mr Wilson. Combined with the absence of formal pleadings, it is, in my view, virtually impossible to determine whether these documents are of such character that they give rise to a sufficiently strong inference of a risk of destruction if they were to remain in the hands of the defendant.
16 In addition to the defendant's application to discharge the injunctions, the plaintiff applies for their continuation and for orders permitting the plaintiff and its solicitors to inspect the documents which are presently held by Mr Wilson upon the terms of the undertakings which he has given to the court. This also raises the question of whether or not Mr Wilson should be a party to these proceedings so that formal and binding orders can be made by the court controlling his treatment of the property seized and, perhaps of equal if not even greater importance, ensuring that Mr Wilson has an avenue to be represented and to make submissions to the court himself or to seek any directions or modifications of the undertaking which he has given which might be called for by the circumstances.
17 In this situation it is not easy to find a solution which meets all the exigencies of the case. That is due, in my view, to the absence of clear definition of the nature of the claim which is presently made, or at least to a large degree.
18 The relief which is being sought on both sides is largely discretionary and I must have regard to the balance of convenience, the seriousness of the questions to be tried, the intrusive nature of Anton Piller relief and the question of whether or not the plaintiff should be left to a right of damages and, in the same vein, whether the ordinary procedures of discovery in an action after pleadings have been delivered should be sufficient to protect the plaintiff's interests and claims.
19 I consider that the proper ascertainment of the rights of the parties to this litigation would be best advanced if I was to make the following orders and directions: firstly, to direct that Ashley David Wilson be joined as a second defendant in the proceedings and that the existing
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- defendant Elisha Clare Williams be termed the first defendant. The purpose of the joinder of Mr Wilson has already been alluded to; namely, to ensure that he is formally bound by any orders or directions made by the court and has an avenue to appear and make submissions if required. So I will direct that he be joined as a party and that the plaintiff file an amended writ of summons, including him as a second defendant, and extending the relief claimed to orders and directions for the control of property which he is holding pursuant to earlier orders of the court.
20 I also consider for the reasons which I have mentioned already that there should be formal pleadings in the action. I direct that the plaintiff file a statement of claim and serve this within 14 days, identifying all the material facts and the causes of action upon which it relies in the proceedings. The first defendant, Ms Williams, is to file a defence within 14 days of service of that statement of claim. The second defendant, Mr Wilson, is to enter an appearance and any defence, presumably a submitting defence, within 14 days of service of the amended writ and statement of claim.
21 In view of the existence of what I consider to be a serious question to be tried, it seems to me that I should order the continuation of the interim ex parte injunction prohibiting the first defendant from the improper use of copyright material or property of the plaintiff derived from her former employment for the solicitation of customers in competition with the plaintiff's business. The terms of that proposed restraint should be reduced to writing by a minute to be prepared by the parties and settled by me later next week, if necessary. But the injunction will be continued directed to restraining the first defendant from using materials in breach of copyright or making use of property derived from her employment by the plaintiff for trade in competition with the plaintiff.
22 As to the materials seized under the Anton Piller order, I am not satisfied at present that a sufficiently strong or cogent case has been established to demonstrate that either the materials presently in the possession of Mr Wilson are at risk of destruction or are vital to the proof and preservation of the plaintiff's causes of action which have, as I have already indicated, not yet been clearly formulated. Accordingly, I refuse the plaintiff's application to inspect those documents and I do not see how it is just to keep them out of the possession of the first defendant at this stage of the proceedings. However, acknowledging that there may be some risk of destruction which would be irreparable, it seems to me that I should take steps to preserve the status quo in a manner which will not
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- confer any immediate advantages upon the plaintiff where an entitlement to inspection of those documents is yet to be established.
23 Accordingly, I will direct that Mr Wilson should make copies of all the documents which have been taken by him pursuant to the Anton Piller order and retain copies in his possession without disclosure to the plaintiff or any third persons until further order of the court. I direct that the originals of the documents shall be returned to the first defendant's solicitors with liberty for them to return them to the first defendant for such use as may be justified in the continuation of her business.
24 Of course while the first defendant will be free to use those documents, subject to the terms of the injunction which I am continuing, she will no doubt be advised and appreciate that adverse inferences might be drawn later in this case if any were to be lost or destroyed.
25 These expedients seem to me to be a sufficient protection of the first defendant's rights to those documents such as they may be, an elimination of the risk of the consequences of the destruction or loss of the documents before trial and a recognition that at present the plaintiff does not appear to have established a sufficiently strong case to be allowed inspection of the documents at this point. All that may change as the case proceeds.
26 I should have said earlier in dealing with the first defendant's application to discharge both injunctions that counsel for the defendant submitted that neither injunction should have been granted having regard to the absence of admissible evidence put before the court on that application. In support of that argument the Court spent an appreciable time this morning considering objections to the affidavits which have been filed on behalf of the plaintiff when those ex parte orders were sought. I dealt with those objections during the course of the proceedings and disallowed most of them. A small number, however, were successful. I say for completeness of the record of today's proceedings that I am satisfied that on the evidence as it then existed there were grounds for the grant of both injunctions.
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