Four Seasons Gutter Protection Pty Ltd v Leafbusters Pty Ltd

[2004] FCA 1290

FEDERAL COURT OF AUSTRALIA

Four Seasons Gutter Protection Pty Ltd v Leafbusters Pty Ltd [2004] FCA 1290

CONTEMPT OF COURT – applicant and first respondent competitors in business of supplying and installing guttering protection – second respondent chief executive officer of first respondent – publication by respondents of document making serious allegations against applicant and its directors – interlocutory injunction against respondents – subsequent publication of amended versions of document – whether breach of injunction – whether respondents responsible – whether respondents liable for contempt of court

EQUITY – respondents found guilty of contempt of court – whether respondents’ application for interlocutory relief should be refused as not being sought with clean hands

Witham v Holloway (1995) 183 CLR 525 at 534 applied
Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 112-113 applied
Meyers v Casey (1913) 17 CLR 90 applied
Hubbard v Vosper [1972] 2 QB 84 applied
Littlewood v Caldwell (1822) 11 Price 97, 147 ER 413 applied
R v Guiren (1962) 79 WN (NSW) 811 at 813 applied
Chanel Ltd v Woolworth & Co Ltd [1981] 1 WLR 485 at 492 applied

C J Miller, Contempt of Court (3^rd edition, 2000) at 657

FOUR SEASONS GUTTER PROTECTION PTY LTD & ORS V LEAFBUSTERS PTY LTD & ORS
V889 of 2004

LEAFBUSTERS PTY LTD & ORS v FOUR SEASONS GUTTER PROTECTION PTY LTD & ORS
V930 of 2004

HEEREY J
11 OCTOBER 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 889 OF 2004 V 930 OF 2004

BETWEEN:	FOUR SEASONS GUTTER PROTECTION PTY LTD (ACN 105 248 191) & ORS APPLICANTS
AND:	LEAFBUSTERS PTY LTD (ACN 059 092 214) & ANOR RESPONDENTS
AND
BETWEEN:	LEAFBUSTERS PTY LTD (ACN 059 092 214) & ANOR APPLICANTS
AND:	FOUR SEASONS GUTTER PROTECTION PTY LTD (ACN 105 248 191) & ORS RESPONDENTS
JUDGE:	HEEREY J
DATE OF ORDER:	11 OCTOBER 2004
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.It is declared that Leafbusters Pty Ltd and Theofani Tsioris are guilty of the contempt of court alleged in pars 5, 6, 7, 7A and 7B of the further amended statement of charges dated 16 September 2004.

2.Questions of penalty and costs are adjourned to a date to be fixed.

3.Leafbusters’ motion by notice dated 8 September 2004 in V 889 of 2004 is dismissed with costs.

4.          Leafbusters’ application for an interlocutory injunction in V 930 of  

2004 is dismissed with costs.

Note:   Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 889 OF 2004 V 930 OF 2004

BETWEEN:	FOUR SEASONS GUTTER PROTECTION PTY LTD (ACN 105 248 191) & ORS APPLICANTS
AND:	LEAFBUSTERS PTY LTD (ACN 059 092 214) & ANOR RESPONDENTS
AND
BETWEEN:	LEAFBUSTERS PTY LTD (ACN 059 092 214) & ANOR RESPONDENTS
AND:	FOUR SEASONS GUTTER PROTECTION PTY LTD (ACN 105 248 191) & ORS APPLICANTS

JUDGE:	HEEREY J
DATE:	11 OCTOBER 2004
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. Four Seasons Gutter Protection Pty Ltd (Four Seasons) and Leafbusters Pty Ltd (Leafbusters) are competitors in the business of supplying and installing guttering protection for residential and commercial premises.  Plastic mesh is placed in roof gutters so as to prevent leaves and other debris from collecting.

2. In June 2004 Leafbusters published a document headed “Alert! Alert!” (the Alert Alert document) which contained many serious allegations against Four Seasons, its proprietors Derek Murphy and Michelle Murphy and their business methods.  A copy of the Alert Alert document follows.  Line numbers have been added to facilitate discussion and analysis.

   
   
   

3. The Alert Alert document was composed by Ms Theofani Tsioris, the Chief Executive Officer of Leafbusters.  She is married to its sole director Mr Paul Groom and is usually known as Thea Groom.

4. On 26 July 2004 in proceeding V 889 of 2004, after a contested hearing in which the parties were represented by counsel, Sundberg J made an order (the Order) granting an interlocutory injunction restraining Leafbusters and Ms Tsioris, whether by themselves, their servants or agents or otherwise howsoever from:

   “(a)publishing, communicating or causing to be published or communicated in Australia the ‘Alert Alert’ document exhibited as DM3 to the Affidavit of the Second Applicant [Derek Murphy] sworn 19 July 2004 and filed herein;

   (b)representing in trade or commerce, whether orally or in writing or otherwise howsoever, in Australia that:

   (i)the First Applicant [Four Seasons] is unethical and does not honour its guarantees;

   (ii)the product photographs displayed by the First Applicant in its promotional literature are not photographs of jobs performed by the First Applicant;

   (iii)the First Applicant misled the Shire of Yarra Ranges;

   (iv)it is the First Applicant’s business practice to mislead and deceive its customers;

   (v)the Second Applicant fled New Zealand to avoid criminal investigation, legal proceedings and a trail of debts to numerous individuals and companies;

   (vi)the Second Applicant is a crook;

   (vii)the Third Applicant [Michelle Murphy] left a trail of debts to numerous individuals and companies in New Zealand;

   (viii)the Applicants do not pay their debts or are an unacceptable credit risk.”

5. Four Seasons and the Murphys allege that, in contravention of the Order, Leafbusters and Ms Tsioris have published, in one instance, the Alert Alert document itself and on other occasions further versions of it which repeat a number of the representations prohibited by the Order.  Four Seasons and the Murphys seek declarations that Four Seasons and Ms Tsioris are guilty of contempt of court and that the Court make orders punishing them for such contempt.

6. On 29 July 2004 Leafbusters and an associated company commenced proceeding V 930 of 2004 against Four Seasons, the Murphys and a number of other respondents alleging contravention of ss 52 and 53 of the Trade Practices Act 1974 (Cth) and their Victorian Fair Trading Act equivalents, passing off, infringement of copyright, defamation and breach of confidence.

7. In V930 of 2004 Leafbusters seeks an interlocutory injunction restraining Four Seasons, the Murphys and the other respondents from:

   (a)       promoting etc and selling goods by reference to:

   (i)the slogan “Never Clean Your Gutters Again”;

   (ii)certain printed materials of Leafbusters (the Leafbusters’ Materials);

   (iii)the Leafbusters getup;

   (b)       reproducing any part of the Leafbusters Materials;

   (c)using the Leafbusters’ Materials or certain other property (Leafbusters’ Property) and delivery up of them;

   (d)making certain representations as to the qualities of Four Seasons’ products and experience (the Four Seasons representations).

   By a motion on notice dated 8 September 2004 in V 889 of 2004 Leafbusters also seeks to have the Order set aside.

8. I propose to deal first with Four Seasons’ contempt of court application.  For reasons to be discussed hereafter, the outcome of this application will affect the resolution of the Leafbusters’ applications.

   Contempt of Court

9. Counsel agreed that Four Seasons must establish beyond reasonable doubt (Witham v Holloway (1995) 183 CLR 525 at 534) that:

   ·the Order was made;

   ·the terms of the Order were clear, unambiguous and capable of compliance;

   ·the Order was served on the alleged contemnor;

   ·the alleged contemnor had knowledge of the terms of the Order;

   ·the alleged contemnor breached the Order.

10. Counsel for Leafbusters accepted that the first four elements were established but not the fifth.  Argument focussed on whether the conduct, the subject of each charge, breached the Order and, if it did, whether Leafbusters and/or Ms Tsioris were responsible.

    The charges

11. The charges were as follows:

    Charge 1

    In breach [of] paragraph 1 (a) of the Order, at about 3.00 pm on 29 July 2004, the First [Leafbusters] and/or Second [Ms Tsioris] Respondent, by their agent, Peter King, published and communicated the ‘Alert Alert’ document to Therese and Brian McGrath, of 24 Warren Road, Nar Nar Goon North, by King leaving the ‘Alert Alert’ document with them at their home.

    Charge 2

    In breach of paragraphs 1(b)(i), (iv) and (viii) of the Order, on 27 July 2004, the First and/or Second Respondent made the representations in trade and commerce by sending the Amended ‘Alert Alert’ document by facsimile transmission to the First Applicant’s [Four Seasons’] supplier, Tapex Pty Ltd.

    Charge 3

    In breach of paragraphs 1(b)(i), (iv) and (viii) of the Order, on 29 July 2004, the First and/or Second Respondent made the representations in trade or commerce, by their agent, John Dixon, handing the Second Amended ‘Alert Alert’ document to Dennis Thompson, of 22 Maidstsone Place, Ferntree Gully.

    Charge 4
    In breach of paragraphs 1(b)(i), (iv) and (viii) of the Order, on 30 July 2004, the First and/or Second Respondent made the representations in trade and commerce by sending the Second Amended ‘Alert Alert’ document by post to a potential customer, Jeanette Benz, of 9 Trenham Court, Mitcham.

    Charge 5
    In breach of paragraphs 1(b)(i), (iv) and (viii) of the Order, on or about 24 August 2004, the First and/or Second Respondent made the representations in trade and commerce by placing, or causing to be placed, the Third Amended ‘Alert Alert’ document in the home mail boxes of:

    (a)       Jason Bakker, of 8 Cantala Crescent, Ringwood North;
    (b)       Paul Anthony Atwell, of 13 Cantala Crescent, Ringwood North;

    (c)Christina Hochgesand–Sunarjo, of 29 Cantala Crescent, Ringwood North.

    Charge 6
    In breach of paragraphs 1(b)(i), (iv) and (viii) of the Order, on 27 August 2004, the First and/or Second Respondent made the representations in trade and commerce by displaying and handing out the Third Amended ‘Alert Alert’ document at the RACV Home Show at the Melbourne Exhibition Centre, Southbank.

    It is alleged that each of the breaches of the order by Leafbusters and/or Ms Tsioris was wilful and in contumacious disregard of the authority of the Court.

    Charge 1

12. On 29 July 2004 at about 3.00 pm, a Mr Peter King, a sales representative employed by Leafbusters, visited the home of Mr Brian and Mrs Therese McGrath at 24 Warren Road Nar Nar Goon.  In the course of his visit Mr King gave Mr and Mrs McGrath a sales presentation and provided a quote on behalf of Leafbusters.  He left some promotional material with them including an Alert Alert document in the form prohibited by the Order.

13. In her affidavit Ms Tsioris deposed that she was informed by her solicitor in the early evening of 26 July 2004 of the making of the Order.  On the following day she informed Leafbusters’ staff of the Order and, in particular, that she was restrained from distributing the Alert Alert document.  She instructed Mr Dean Russell, the Leafbusters logistics manager, to contact all the Leafbusters sales representatives and direct them to remove the Alert Alert documents from the presentation folders.  She also told Mr Russell to ensure that all the Alert Alert documents were removed from the presentation folders, which had been compiled and were stored at Leafbusters’ business premises.  Mr Russell told her he had complied with her instructions.  She overhead him speaking on the telephone at Leafbusters’ offices giving instructions that the Alert Alert document must be removed from the folders.  She assisted staff in removing the documents from the folders.  She contacted each of the Leafbusters sales representatives to confirm that they had adhered to Mr Russell’s instructions.  She received confirmation from them that they had received a call from Mr Russell to remove the documents from their folders.

14. On being told of the affidavit sworn by Mrs McGrath, Ms Tsioris asked Mr King if he was aware that an Alert Alert document was in the presentation folder.  Mr King told her that he was certain he had removed all of the Alert Alert documents from the folder and had torn them up as Mr Russell had requested.  Mr King told her that he did not recall having included the Alert Alert document in the presentation folder he left with Mr and Mrs McGrath.  No objection was taken to the hearsay form of this evidence.

15. While I am satisfied that the Alert Alert document was left with Mr and Mrs McGrath by Mr King, I am not satisfied that the leaving of it was other than casual, accidental or unintentional:  see Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 112-113. It is not quite clear from Mudginberri whether, as counsel for Leafbusters argued, a breach that is casual, accidental or unintentional is not a contempt at all or whether it is a “technical” contempt in respect of which a penalty should not be imposed.  Their Honours did not need to consider that point because the facts of the case in Mudginberri certainly involved wilful and intentional conduct in the form of continuation of a union picket line.  In C J Miller’s Contempt of Court (3^rd edition, 2000) at 657 it is said that:

    “ … given the requisite knowledge of the order, a civil contempt will usually require no more than proof of an intentional act, or a bare omission, which is in breach of it.”

16. I am not satisfied to the requisite standard that the act of Mr King in leaving the Alert Alert document in the folder was intentional in that sense.  It is reasonably possible that he was not aware of the presence of the document in the presentation folder.

17. Charge 1 is dismissed.

    Charge 2

18. On 27 July 2004, Ms Tsioris sent to Mr Fabian Morgan of Tapex Pty Ltd a fax on Leafbusters letterhead which relevantly said as follows (emphasis in original):

    “Re Four Seasons

    Following is a New Public Service announcement.

    I want to ensure I always do the lawful thing - so please destroy and disregard the previous Alert Alert flyer as it is hurtful to the Murphys and FOUR SEASONS.

    I offer this one respectfully in accordance with the “INTERIM” injunctions of the FEDERAL COURT.

    Warm Regards
    Thea

    PS  Do you want a full copy of the Smith letter?  Also did you know Murphy used you in his affidavit?  Guess you will have to give evidence.”

    The document (the Amended Alert Alert document) enclosed with the fax is headed “Alert Alert” (without exclamation marks).  In place of lines 2-5 in the original Alert Alert document it has the following:

    Pursuant to the interim (not final) orders of the Federal Court of Australia by his
    Honour Justice. Sudberg [sic] – File No:  V889 OF 2004 on the 26^th July 2004
    The Alert Alert document (circa June 2004) is withdrawn and not to be distributed.

    Four Season [sic] sought orders to restrain me from saying certain things,
    The Interim injunction placed upon me, forced me to remove some points:  here
    Is the new Annoucement [sic] to comply with the above orders:
    Community Service Announcement
    Brought to you by:  Thea Groom CEO – Leafbusters.
    Of 1 Basin-Olinda Road, Olinda Ph:  9751 2255

19. Lines 6 and 7 of the original Alert Alert document are repeated (“Leafbusters:  est. over 12 years … Fair Trade Award”).  Then the following is inserted (emphasis in original):

In this state it is legal to tell the truth!
Even though it requires Leafbusters to spend their own money in Federal Court to defend
the right to do so, to keep people informed of the truth!

1. Lines 10 and 11 of the original Alert Alert document are repeated (“Leafbusters is spending … with truth”).

2. Then the Amended Alert Alert document repeats the “Shame File” of the original Alert Alert document with the following exceptions:

   ·After the reference to the CFA in line 18 are added the words “turn over for public record of Four Seasons Apology to the public & CFA”;

   ·The words “That Four Seasons are an ethical company that will honour their guarantees FALSE!” in line 25 are deleted and replaced by the words “Deleted as per court orders”;

   ·The words “That the product photos displayed in their literature is their jobs FALSE!” in line 27 is deleted and replaced by the words “Deleted as per court orders”.

3. Then the lines 31 to 36 of the original Alert Alert document (“Be aware … sell their products”) are deleted.  The words in line 37 “Thank you to all of our customers who have done their due diligence and purchased from us instead of being sucked in by Four Seasons” are included with the underlining and bold added, but the remainder of lines 37-39 are deleted.  To the heading “Fact File” (line 40) are added the words “(Please also turn over for Public Record)”.

4. Under the heading “Fact File”:

   ·No.1 (line 41) the words “and or his companies” have been added after “Mr Murphy and …”

   ·No 2 (line 42) the words “When we were informed of his unethical behaviour” are deleted and the words “(deleted by court orders)” inserted;

   ·No 4 (line 45) the words “turn over for public record” are inserted after “client of theirs”.

   ·No 6 (line 47) is deleted and replaced with the words “Deleted by court orders”;

   ·No 7 (line 48) the words “Leafbusters took action in the High Court of New Zealand against Mr Murphy” are deleted and replaced with “Mr Murphy and or his numerous companies gave an undertaking to the High Court in New Zealand to stop using Leafbusters intellectual property, deliver up our goods and stock and phone numbers and not use the slogan: “Never Clean Your Gutter Again” – turn over for public record – ”.

   ·No 9 (line 50) is deleted and replaced with the words “Deleted by court orders”;

   ·No 13 (line 54) is deleted and replaced with the words “Deleted by court orders”;

   ·No 14 (line 56) after the words “mesh and guarantees” are added the words “turn over for advise (sic) from one client who gives permission to have this letter published”.

   ·No 15 (line 57) is deleted and replaced with the words “Deleted by court orders”.

5. Line 59 is retained but lines 60-61 (“Fact – Only … working for Leafbusters.”) are deleted.  Lines 62-64 are repeated.  Lines 65-69 are deleted and replaced by the following:

6. The following additional pages then appear:

   
   
   
   

7. I am satisfied that the following breaches of the Order have been committed.

8. All the statements under the heading “Shame File” in the Amended Alert Alert document convey the meaning that Four Seasons makes false statements in the course of its business and thus it is unethical and its business practice is to mislead and deceive its customers (Order (b)(i) and (iv)).  I shall refer to this breach of the Order as breach A.

9. The statement that customers of Leafbusters have done due diligence and as a result have chosen to purchase from Leafbusters “instead of being sucked in by Four Seasons” conveys the meaning that Four Seasons is unethical and its business practice is to mislead and deceive its customers.  Were it not for the due diligence of the customers they would have been “sucked in”, i.e. deceived, by Four Seasons (Order (b)(i) and (iv)) – breach B.

10. Under “Fact File” nos 3, 4 and 5 convey the meaning that the Murphys do not pay their debts and are thus an unacceptable credit risk (Order (b)(viii)) – breach C.

11. Under “Fact File” no 14 conveys the meaning that Four Seasons and the Murphys deceived clients into thinking they were dealing with Leafbusters and thus they were unethical and their business practice was to mislead and deceive customers (Order (b)(i) and (iv)) – breach D.

12. The statement “Four Seasons is intent on trying to ruin Leafbusters brilliant name, product and reputation with its lies” conveys the meaning that Four Seasons is unethical and that its business practice is to mislead and deceive its customers (Order (b)(i) and (iv)) – breach E.

13. The statement in line 69 “The Court then ordered the Murphy’s [sic] to pay the client – to date they have not paid” conveys the meaning that Mr and Mrs Murphy do not pay their debts or are an unacceptable credit risk (Order (b)(viii)) – breach F.

1. The statement in line 144 “Was sold with no intention of honouring the guarantee should it be required” conveys the meaning that Four Seasons is unethical and does not honour its guarantees (Order (b)(i)) – breach G.

2. The statement in line 146 that “The company (Four Seasons Ltd) and its directors hope that if they ignore people long enough they will go away” conveys the meaning that Four Seasons is unethical and does not honour its guarantees (Order (b)(i)) – breach H.

3. There can be no doubt that the sending of the Amended Alert Alert document was authorised by Ms Tsioris personally and was sent on behalf of Leafbusters.  So much appears from the terms of the fax.  In an affidavit sworn on 8 September 2004 Ms Tsioris deposed that she “created” the Amended Alert Alert document and that she believed that it does not infringe the Order “because I deleted those parts of it which Leafbusters and I were expressly restrained from representing”.  Moreover, after Tapex advised Mr Murphy of the receipt of the fax he consulted his solicitors and they wrote to Leafbusters’ solicitors demanding an undertaking not to publish or cause to be published the Amended Alert Alert document.  Leafbusters’ solicitors responded denying that the document breached the Order, but stating:

   “In any event, we are instructed that our clients agree not to further publish this document”.

4. I find Charge 2 proved.

   Charge 3

5. Mr Dennis Thompson of 22 Maidstone Place, Ferntree Gully has been for several years a friend of Mr Peter Filer, who is a sales consultant for Four Seasons.  In late July 2004 Mr Filer asked Mr Thompson to call out a Leafbusters sales consultant to provide a quote and to see whether the consultant would hand out an Alert Alert document.  Mr Thompson agreed to this.  What was proposed therefore was analogous to a trap purchase.

6. On 29 July 2004 Mr John Dixon from Leafbusters visited Mr Thompson at his home to prepare a quote on a gutter protection system.  Although Mr Thompson does not directly say so, it is implicit in his affidavit that this visit was at his request.

7. During the visit Mr Dixon provided a written quote on a Leafbusters printed form.  Mr Dixon’s name and mobile phone number are written in a printed box captioned “Your Local Leafbusters Consultant”.  Mr Dixon also left with the quote some printed material including a document headed “Alert Alert” (the Second Amended Alert Alert document).

8. The Second Amended Alert Alert document differs from the Amended Alert Alert document in the following respects:

   (a)       the second par “Four Seasons sought … orders.” (see [17] above) is amended to read:

   “Four Seasons sought orders to restrain me from saying only some things, and was successful in part and so obtained the Interim injunction placed upon me”;

   (b)       The sentence “Even though … of the truth!” (see [18] above) is deleted;

   (c)       The words “instead of being sucked in by Four Seasons” are deleted; and

   (d)The words “Every business … with its lies” are deleted and replaced with:

   “Leafbusters prides itself on innovating and growing the industry with hard work and best business practice”.

9. The additional pages added in the Amended Alert Alert document ([25] above) are included.

10. For the reasons already mentioned, publication of the Second Amended Alert Alert document constituted breaches A, C, D, F, G and H above.

11. Counsel for Leafbusters submitted that there was no evidence that John Dixon was the agent of Ms Tsioris for any purpose.  However, it does not seem to be disputed that she was the author of the Second Amended Alert Alert document.  It bears her name and states:

    “Brought to you by:  Thea Groom CEO – Leafbusters”

12. Ms Tsioris’ intention to publish this document is clearly demonstrated in her affidavit sworn on 8 September 2004 by her statement that “the Second Amended Alert document do[es] not infringe the Orders because I deleted those parts of it which Leafbusters and I were expressly restrained from representing”. The document was obviously prepared by Ms Tsioris for the purpose of publication to potential customers of Leafbusters. Such publication was likely to include publication by agents such as Mr Dixon. 

13. It is clear that Mr Dixon was acting on behalf of Leafbusters when he left the material including the Second Amended Alert Alert document with Mr Thompson.  In her affidavit Ms Tsioris gives a detailed explanation as to the accidental publication, the subject of Charge 1, but says nothing as to any involvement in the publications which are the subject of the other charges or proffer any explanation as to how the publications might have occurred without her knowledge.  The inference is inescapable that Ms Tsioris, the CEO of Leafbusters and author of the document, was personally involved in its publication by Mr Dixon.

14. When a defendant in a criminal case goes into evidence but does not give an explanation for some incriminating circumstances the jury may taken this into account in reaching a guilty verdict: R v Guiren (1962) 79 WN (NSW) 811 at 813. The same reasoning is applicable in the present case.

15. I find Charge 3 proved.

    Charge 4

16. In July 2004 Ms Jeannette Benz of 9 Trentham Court was watching Bert Newton’s popular Good Morning Australia television program when she saw an “informercial” for the Leafbusters gutter protection system.  She wrote down the contact details.  On Friday 20 July she telephoned Leafbusters and spoke to a man called Dean.  He offered to send someone out to her home and give a quote.  Ms Benz told him she preferred to first see some written material and would call them back if she decided to meet a representative.

17. On Monday 2 August at about 2.30 pm Ms Benz opened her mail.  Included in it was an A4 envelope bearing the name and address of Leafbusters.  Inside the envelope was a letter dated 30 July 2004 on Leafbusters letterhead and addressed to her.  The letter commences by thanking her for her enquiry and stating that “we enclose brochures, information sheets and samples as requested”.  Then follows detail about the Leafbusters product.  The letter concludes:

    “Yours faithfully,
      per
    Thea Groom
      Operations Manager”

    There is no signature.  Accompanying the letter was some printed material and a copy of the Second Amended Alert Alert document.

18. Shortly afterwards Ms Benz telephoned Leafbusters and spoke to some one called Rebecca.  Ms Benz said she was shocked that Leafbusters had sent out the Alert Alert document and that one of the company’s sales representatives could never grace her doorstep.  She asked Rebecca to forward that information to Thea Groom.

19. Ms Benz then telephoned Mr Murphy and told him about the Alert Alert document.  At his request she delivered a copy to him.

20. On the same day Ms Benz sent an email to Thea Groom (i.e. Ms Tsioris) expressing in strong terms her “disgust” and “outrage” at the “smear campaign” in the Alert Alert document and advising that she had passed it on to Four Seasons.

21. Prior to 2 August 2004 Ms Benz had had no contact with the Murphys, Four Seasons or any of its sales people.

22. The only argument advanced by counsel against this charge is that there was no evidence that Leafbusters sent the Second Amended Alert Alert document by post to Ms Benz.  In my view there is ample evidence including:

    ·Ms Benz’s request to Dean that information be sent;

    ·The stamped envelope addressed to Ms Benz bearing the name and address of Leafbusters;

    ·Ms Benz’s evidence that she received the letter in her mail; and

    ·Ms Benz’s email and the lack of response thereto.

23. The Second Amended Alert Alert document is, of course, the same document as that which founds Charge 3.  The same breaches have therefore been committed.  The involvement of Ms Tsioris is established for the reasons already given.

24. I find Charge 4 proved.

    Charge 5

25. Mr Jason Bakker lives at 8 Cantala Crescent, Ringwood.  Derek and Michelle Murphy live in the same street.  Mr Bakker has known them since about April 2003.

26. On 24 August 2004 Mr Bakker came home from work at about 4.30 pm and went to his letterbox to retrieve his mail.  In the letterbox was a document (the Third Amended Alert Alert document).

27. The Third Amended Alert Alert document differs from the Second Amended Alert Alert document as follows:

    ·The second paragraph “Four Seasons sought … placed upon me” is deleted;

    ·“In this state it is legal to tell the truth!” is deleted;

    ·The heading “Shame File” is deleted but otherwise the assertions thereunder are retained, except that the words “turn over for public record of Four Seasons Apology to the public and CFA” are deleted;

    ·The heading “Fact File – (Please also turn over for Public Record)” is deleted but otherwise the assertions thereunder are retained except

    -Nos 4 and 7 – the words “turn over for public record” are deleted

    -No 14 – the words “turn over for advise [sic] from one client who gives permission to have his letter published” are deleted

    ·The words “Residents – please … Because it works” are deleted except for the words “All Australian and proud of it!”

28. Mr Paul Atwell lives at 13 Cantala Crescent.  On 24 August he came home from work at 5.45 pm and went to retrieve his mail.  In it was a document entitled “Alert Alert”.  He went into his home and read the document.  He put it in his wastepaper disposal bin.  That night he put the bin out with other garbage for collection.  Maroondah Council staff collected the garbage the next day.

29. At about 7.00 pm on 25 August Michelle Murphy visited Mr Atwell’s home and asked him whether he had received a document entitled “Alert Alert”.  He told her he had but had thrown it out with the garbage the previous day.  He identified the Third Amended Alert Alert document as the document he received.

30. Ms Christina Hochgesand-Sunarjo lives at 29 Cantala Crescent.  She has known Michelle Murphy for about a year.

31. On 25 August Michelle Murphy telephoned Ms Hochgesand-Sunarjo and asked her whether she had received a document with the words “Alert Alert” on it in the mail.  She said she had not yet checked the mail and would do so straight away.  She went to her letterbox and in the mail found a copy of the Maroondah Leader newspaper.  On going back into her house and opening the newspaper she found a copy of the Third Amended Alert Alert document.  She telephoned Michelle Murphy and told her she had received the document.

32. The Third Amended Alert Alert document effected the same breaches of the Order as the Second.

33. I am satisfied that Leafbusters and Ms Tsioris were involved in the placing of the Third Amended Alert Alert documents in three letterboxes in Cantala Crescent.  I conclude that the document, which bears the name of Ms Tsioris, was created by her, like the Amended and Second Amended Alert Alert documents, for publication in furtherance of her obsessive campaign against Four Seasons.

34. The documents were obviously prepared for publication.  There is no suggestion as to who else might have published them.

35. The fact that out of all of metropolitan Melbourne, these documents were letterboxed in the suburban street where the Murphys live is indicative of the depth of the personal animus which motivated Ms Tsioris.  Yet that does not mean the publications were not in trade or commerce.  The publication concerned a trade rival and was made to various suburban householders who were potential purchasers of the competing products.

36. I find Charge 5 proved.

    Charge 6

37. Mr Andrew Hinds is a franchisee and sub-contractor for Four Seasons.

38. On 27 August 2004 Mr Hinds attended the Home Show at the Melbourne Exhibition Centre at Southbank.  At about 4.30 pm he was at the Leafbusters’ stand and saw a man whom he recognised as the father of Ms Tsioris folding and handing out a document entitled “Alert Alert” to passers by.  Mr Hinds produced a photograph he took at the time.  The document is on A3 size glossy paper and printed in different colours.

39. Mr Hinds returned to the Four Seasons stand.  Within two hours a passer-by approached him and handed him one of the Alert Alert documents he had seen Mr Tsioris folding earlier that day.  It was the Third Amended Alert Alert document.

40. Mr Hinds was at the Home Show until 10.00 pm on 27 August.  At that time he saw the Third Amended Alert Alert document being handed out from the Leafbusters’ stand to numerous passers by.

41. For the reasons already mentioned the publication of the Third Amended Alert Alert document breached the Order.

42. Counsel for Leafbusters argued that there was no evidence that the father of Ms Tsioris was the agent of her or Leafbusters so as to make them or either of them vicariously liable for his conduct.

43. I do not agree.  The conduct in question occurred at and from premises, the Leafbusters stand, plainly identified with the company.  In the absence of any evidence to the contrary, and there is none, it can be safely concluded that a person at the stand engaging in activity, which on its face had some connection with the business of Leafbusters, was acting with the authority of the company and on its behalf.

44. The liability of Ms Tsioris is established by her being named as the author of the document, her relationship with her father, her role as the Chief Executive Officer of Leafbusters and the lack of any explanation as to how the document came to be published in circumstances so obviously connected with Leafbusters’ business.

45. I find Charge 6 proved.

    Effect of contempt findings on Leafbusters’ applications

46. A party seeking discretionary relief must, as the time-honoured metaphor has it, come to the Court with clean hands.  To disqualify a party from relief however its misconduct must have “an immediate and necessary relation to the equity sued for”: Meyers v Casey (1913) 17 CLR 90 at 124.

47. In the present case the relief sought by Leafbusters arises in the context of competition between itself and Four Seasons.  The latter company came to this Court complaining of wrongful statements published by Leafbusters in the Alert Alert document.

48. Having lost a contended interlocutory injunction application, Leafbusters did not accept the Court’s order, or seek leave to appeal, but embarked on a deliberate campaign to republish, in a way calculated to cause serious damage to Four Seasons, a disingenuously disguised version of the same document.  Leafbusters is now seeking the protection of the Court’s authority to prevent alleged harm when it has acted unlawfully and defied the Courts’ authority in an attempt to protect itself from harm of the same character, that is to say harm caused by allegedly unlawful marketing practices of Four Seasons. 

49. Refusal of relief in such circumstances is well supported by authority.  In Hubbard v Vosper [1972] 2 QB 84, the Scientology organisation sought an interlocutory injunction to protect its confidential information. It had an elaborate code of ethics under which persons who set out to suppress or damage Scientology by “suppressive acts” (defined to include such things as bringing a civil suit against Scientology or writing anti-Scientology letters to the press) became “Fair Game” and no Scientologist was to be condemned under its ethical code for any action, including murder and arson, taken against such a person.  Megaw LJ held (at 101) that the plaintiffs had been protecting their secrets by deplorable means and that they did not come to the court with clean hands in asking the court to protect their secrets by the equitable remedy of injunction.

50. In Littlewood v Caldwell (1822) 11 Price 97, 147 ER 413, the plaintiff sought to protect his interests against his partner by illegally removing the partnership books from the partnership. That conduct was held to disentitle the plaintiff to an interlocutory injunction to restrain the defendant from interfering with the partnership business.

51. This Court cannot countenance a party waging commercial warfare against a rival on two fronts, one in the Court and the other by contumacious defiance of the Court’s order.

52. The same considerations apply to Leafbusters’ application to set aside the Order.  Moreover there is the further point that Leafbusters is merely seeking to advance new evidence which it could have obtained at the first hearing.  The observations of Buckley LJ in Chanel Ltd v Woolworth & Co Ltd [1981] 1 WLR 485 at 492 are applicable:

    “They, the defendants, are seeking a rehearing on evidence which, or much of which, so far as one can tell, they could have adduced on the earlier occasion if they had sought an adequate adjournment, which they would probably have obtained.  Even in interlocutory matters a party cannot fight over again a battle which has already been fought unless there has been some significant change of circumstances, or the party has become aware of facts which he could not reasonably have known, or found out, in time for the first encounter.”

    Orders

53. There will be orders that:

    1.It is declared that Leafbusters Pty Ltd and Theofani Tsioris are guilty of the contempt of court alleged in pars 5, 6, 7, 7A and 7B of the further amended statement of charge dated 16 September 2004.

    2.Questions of penalty and costs are adjourned to a date to be fixed.

    3.Leafbusters’ motion by notice dated 8 September 2004 in V 889 of 2004 is dismissed with costs.

    4.Leafbusters’ application for an interlocutory injunction in V 930 of 2004 is dismissed with costs.

I certify that the preceding eighty five (85) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey.

Associate:

Dated:            11 October 2004

Counsel for Four Seasons Gutter Protection Pty Ltd:	G Dalton
Solicitor for Four Seasons Gutter Protection Pty Ltd:	Charles Birch
Counsel for Leafbusters Pty Ltd:	A Panna
Solicitor for Leafbusters Pty Ltd:	Macpherson and Kelley
Date of Hearing:	17 September 2004
Date of Judgment:	11 October 2004