IceTV Pty Ltd v Ross & ors

[2009] NSWSC 205

CITATION:	IceTV Pty Ltd v Ross & ors [2009] NSWSC 205
HEARING DATE(S):	13 March 2009
JUDGMENT DATE :	27 March 2009
JURISDICTION:	Equity Division Expedition List
JUDGMENT OF:	Brereton J
DECISION:	If practicable, the contempt motion should be heard before the substantive hearing, but not so as to prejudice that hearing. As such hearing dates not reasonably practicable, fixed for 26 May 2009.
CATCHWORDS:	PROCEDURE - Contempt - contempt by influencing a witness – whether hearing of motion alleging contempt should precede, accompany or follow the substantive hearing - where there is no significant overlap of issues – contempt hearing should, if possible, precede the substantive hearing
CATEGORY:	Procedural and other rulings
CASES CITED:	Australian Consolidated Press v Morgan (1965) 112 CLR 483 Farahbakht v Midas Australia Pty Limited [2006] NSWSC 1322 Ferrier v Kelada (No 1) [2004] VSC 355
PARTIES:	IceTV Pty Ltd (plaintiff) Duncan Ross (first defendant) Peter Vogel (second defendant) Vogel Ross Pty Ltd (third defendant)
FILE NUMBER(S):	SC 2577/07
COUNSEL:	Mr J M Ireland QC (plaintiff) Mr D Ross (first defendant) (in person) Mr P Vogel (second defendant) (in person)
SOLICITORS:	Bartier Perry (plaintiff)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
EXPEDITION LIST

BRERETON J

Friday, 27 March 2009

2577/07 IceTV Pty Limited v Duncan Ross & ors

JUDGMENT

1 HIS HONOUR: The first defendant Mr Duncan Ross and the second defendant Mr Peter Vogel are former employees of the plaintiff IceTV Pty Ltd (“IceTV”). The third defendant Vogel Ross Pty Ltd (“Vogel Ross”) is a company that Mr Ross and Mr Duncan formed on 29 September 2006, whilst still in the employ of IceTV. IceTV claims that Mr Ross and Mr Vogel breached provisions of their respective employment contracts – in particular, obligations of confidentiality and fidelity – both before and after the termination of their employment contracts on 4 October 2006, by providing consultancy services to Mobilesoft in the field of video on-demand services for content provision, and thereby being involved in a business similar to or competitive with the business of IceTV carried on during the period of 12 months prior to the termination of their employment (in contravention of sub-paragraph (a) of a non-solicitation restraint contained in their contracts) and also by soliciting Mobilesoft, who had entered into discussions or negotiations with IceTV during that 12 months prior to termination of their employment, with a view to becoming a customer of IceTV for a contract to provide consultancy services (in contravention of sub-paragraph (c) of that restraint).

2 IceTV sought an interlocutory injunction to restrain the defendants from engaging in that conduct. Following an interlocutory hearing on 28 May 2007, on 3 July 2007 I granted IceTV an interlocutory injunction. On 28 September 2007, I discharged that injunction, in circumstances where the defendants had showed that IceTV’s undertaking as to damages was worthless, when it had been a material consideration on the balance of convenience when granting that injunction. I also made an order that IceTV give security for costs of the proceedings, and I rejected an application by the defendants to join IceTV directors as "co-plaintiffs". IceTV’s claim is now one for damages.

3 After further interlocutory issues, including amendments by the plaintiffs to introduce additional parties and causes of action, and the vacation of dates previously fixed for hearing, on 13 March 2009 I fixed for hearing on an expedited basis the final hearing of the substantive proceedings, before Rein J, to commence on 27 April 2009 for three days. I did so because of the defendants’ claims of hardship, and the delays already occasioned – usually by IceTV – to the readying of the matter for hearing.

4 The defendants have filed a motion alleging a contempt of court by Mr Colin O’Brien, a principal of IceTV, alleging that he has sought to influence the evidence of a witness, Mr Simms, of Mobilesoft. Mr Simms has sworn an affidavit supporting the allegation; Mr O’Brien has sworn an affidavit denying it. It is said on Mr O’Brien’s part that it is anticipated that further evidence will be adduced on his behalf; however, in the context of a contempt application it is inappropriate to direct that the respondent serve evidence before the applicant’s case is closed and cross-examination completed.

5 The present issue concerns the hearing of the motion for contempt, and in particular whether it should precede, accompany or follow the substantive hearing. All agree that the contempt application should be disposed of as soon as possible. However, IceTV submits that the contempt motion should be deferred until after completion of the substantive proceedings, while Mr Ross and Dr Vogel submit that it should be heard at the earliest possible opportunity, before the substantive matter.

6 The possibility of concurrent hearings can be immediately dismissed. No party supported it. Such a course would be entirely unsuitable for the quasi-criminal contempt jurisdiction. The standard of proof is different. The issues are different. In the contempt application, the respondent if he wishes is entitled to remain silent.

7 Although there is authority that the hearing of a contempt motion in proceedings should be postponed to the substantive hearing [Australian Consolidated Press v Morgan (1965) 112 CLR 483, 489 (Barwick CJ)], that is so only where the same or similar issues of fact will arise [cf Ferrier v Kelada (No 1) [2004] VSC 355; Farahbakht v Midas Australia Pty Limited [2006] NSWSC 1322], and in any event any such practice must yield to the requirements of safeguarding the interests of justice. Moreover, there is much to be said for the view that a respondent’s rights are better protected by dealing first with the quasi-criminal matter, during which the respondent may safeguard his right to remain silent, before the substantive proceeding, in which he will then be at liberty to give evidence if so advised without risk of self-incrimination.

8 All agree that Mr Simms is an important witness in the substantive proceedings, as well as in the contempt application. However, the subject matter of his evidence will be quite different in each case. In the substantive proceedings it will go to the business relationship between IceTV and Mobilesoft during 2006-07. In the contempt application it will go to his recent contact with Mr O’Brien. I do not accept that there will be a substantial overlap between the two matters, in respect of his evidence and cross-examination. In any event, as on no view would the two matters be heard concurrently, any such duplication is inevitable, whichever of the alternative courses is adopted.

9 IceTV submitted that if the contempt application were heard after the substantive proceeding it could be heard by the same judge, with the benefit of a complete understanding of the facts. I disagree. A judge compelled to make findings of credit in the substantive proceedings might well be inhibited from hearing the contempt motion. Knowledge of the whole of the facts of the substantive matter would be irrelevant to the issues on the contempt motion.

10 I agree with the defendants’ submission that the purpose of contempt proceedings in the present context – including specific and general deterrence in respect of approaches to witnesses – is best served by hearing the application before the substantive proceedings, particularly in the light of Mr O’Brien’s affidavit evidence that even after becoming aware of these allegations he has again been in contact with Mr Simms.

11 Accordingly I conclude that, if practicable, the contempt motion should be heard before the substantive hearing, but not so as to prejudice that hearing. The practical difficulty is finding a time available to the Court and not inconvenient to the parties for that purpose, allowing that disruption to preparation for the substantive hearing should be avoided. The Court could hear the matter on 23 or 24 April 2009. I will hear from the parties as to the available dates.

12 Having heard from the parties as to the available dates and having regard to their proximity to the hearing to commence on 27 April, and to the circumstance that they would be before the same judge who is to hear the substantive matter, I do not think it is sensible to fix the matter for those dates which are the only available dates to the Court. The next available date is 26 May 2009 before Debelle AJ, and I will fix the matter for that day.

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