Magenta (WA) Pty Ltd t/as Palassis Architects v Moredount [No 2] - [2013] WASC 197

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: MAGENTA (WA) PTY LTD t/as PALASSIS ARCHITECTS -v- MOREDOUNT [No 2] [2013] WASC 197

CORAM: ALLANSON J

HEARD: 22 MARCH 2013

DELIVERED : 24 MAY 2013

FILE NO/S: CIV 2542 of 2010

BETWEEN: MAGENTA (WA) PTY LTD t/as PALASSIS ARCHITECTS
Plaintiff
AND
NERIDA MOREDOUNT
Defendant

Catchwords:

Practice and procedure - Application for further and better particulars of damages - Requirement of conferral - Turns on own facts

Legislation:

Rules of the Supreme Court 1971 (WA), O 59 r 9

Result:

Application dismissed
Defendant to pay costs of application

Category: B

Representation:

Counsel:

Plaintiff: Mr R L Marando
Defendant: Mr P R MacMillan

Solicitors:

Plaintiff: Jackson McDonald
Defendant: Gibson Lyons

Case(s) referred to in judgment(s):

Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2006] WASC 161; (2006) 33 WAR 1

ALLANSON J: These are my reasons for dismissing the defendant's application for further and better particulars of the plaintiff's damages, and for awarding part of the costs of that application to the plaintiff.
Order 59 r 9 of the Rules of the Supreme Court 1971 (WA) requires parties to confer before making an application in chambers. The Consolidated Practice Directions, in 4.3.2, explain that what O 59 r 9 requires is that there be an exchange of views for the purpose of trying to resolve the matters in issue, so that only those matters that are really in dispute are referred to the court: see Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2006] WASC 161; (2006) 33 WAR 1 [3] ‑ [5]. The purpose of the conferral process should be readily apparent. Cases like the present illustrate how the time and resources of both the court and the parties could be saved by genuine attempts to discuss and resolve matters that would otherwise give rise to an application.

History

Nerida Moredount is an architect and was previously an employee of Magenta (WA) Pty Ltd. She left her employment in September 2010 after giving two weeks notice of her resignation. On leaving her employment Ms Moredount entered employment with The Planning Group WA Pty Ltd (TPG), a competitor of Magenta.
Magenta began these proceedings in 2010, initially applying for an injunction. In its statement of claim, Magenta pleads that unless restrained Ms Moredount will use confidential information to the detriment of Magenta in breach of contractual and fiduciary duties and will infringe Magenta's copyright.
Magenta pleads that in breach of express terms of her contract Ms Moredount solicited or sought to solicit Landcorp to engage her, through TPG, to provide heritage services to Landcorp in respect of a project identified as the Cockburn Coast Project.
Magenta also alleges that, while she was employed by Magenta, Ms Moredount had access to confidential information including submissions made by Magenta in respect of specific projects, and including a project identified as the Riverside Stage 3 Project. Magenta pleads:
1.Ms Moredount used information she obtained in her employment to obtain a copy of Magenta's submission for the Riverside Project;
2.Ms Moredount submitted a fee proposal on behalf of TPG in respect of the Riverside Project which was substantially in identical terms to Magenta's submission and was a substantial reproduction of Magenta's submission;
3.further or alternatively, that her conduct was an improper use of information she obtained as an employee, in contravention of s 183(1) of the Corporations Act 2001 (Cth) and in breach of the express terms of her contract of employment.
In par 22 of its statement of claim, Magenta pleads that Ms Moredount's conduct was in breach of her equitable obligation of confidence and, in par 23, a breach of a duty of loyalty or a fiduciary duty.
In par 30, Magenta pleads that it has and will suffer loss and damage as a result of Ms Moredount's breaches of the contract, breach of her fiduciary obligations to Magenta, breach of her equitable duty of confidence to Magenta and infringement of Magenta's copyright. The particulars of loss and damage, as pleaded, are:
Full particulars will be provided prior to trial and by way of expert evidence.
The Plaintiff's loss and damage includes loss of fees and revenue on the Riverside Stage 3 Project and the Cockburn Coast Project.
In respect of the infringement of the Plaintiff's copyright, the Plaintiff also claims additional damages pursuant to s 115(4) of the Copyright Act 1968 and will rely upon the fact that the contravention occurred in breach of the express terms of the Contract and the Australian Institute of Architects Code of Conduct as pleaded in paragraph 9(1)(b) and (c) above.
I do not think it can be in dispute that the allegation in par 30 is required to be better particularised in some way. But the plea in the statement of claim does not stand alone. On 7 July 2011 Magenta provided particulars of loss on two projects: the Riverside Stage 3 Project and the Cockburn Coast Project, setting out in each case the amount of fees lost on the project and the expenses it would have incurred in performing the work.
On 13 December 2011, Mr Lyons of Gibson Lyons, the solicitors for Ms Moredount, wrote to Jackson McDonald, who are acting for Magenta, and asked for 'full particulars of the calculation of the quantum together with the relevant discovery'. Jackson McDonald replied, but were slow in providing a substantive response. As a result, in March 2012 the solicitors for Ms Moredount proposed having the matter relisted for directions.
On 29 May 2012, Ms Moredount applied by chamber summons for orders, including that Magenta provide full particulars of part of its claim for loss and damage, and give discovery of all documents relevant to that loss and damage. On 1 June 2012, I made those orders by consent.
On 3 July 2012, Magenta provided discovery and further and better particulars. The particulars set out the amount of fees (previously specified) and the items of work for which those fees would have been incurred.
On 12 July, Mr Lyons wrote to Jackson McDonald and requested copies of identified documents, and also discovery of certain timesheets of Ms Moredount in relation to work she did as an employee of Magenta. The letter queried aspects of the provided particulars and the lack of particularity as to how the sums claimed had been arrived at. Mr Lyons wrote again on 14 August, again asserting a lack of particularity and proposing to again have the matter relisted.
On 23 August, Ms Moredount sought orders by chamber summons that the plaintiff comply with the orders of 1 June 2012 in relation to particulars and discovery and provide the additional discovery she had sought or its claim be dismissed. In an affidavit in support of the application, Mr Lyons exhibited his letters to Jackson McDonald of 12 July and 14 August 2012 but not the material he had received from Jackson McDonald. The difficulties of conferring entirely by correspondence are well illustrated by the fact that, from 17 July 2012, the copies of documents that Mr Lyons had asked for on 12 July had been compiled and were waiting to be collected at the offices of Jackson McDonald. A phone call would have resolved that issue.
On 3 September, Jackson McDonald filed an affidavit made by Mr Marando, the partner with conduct of the matter, to which he annexed correspondence with Mr Lyons. That affidavit disclosed that:
1.On 26 August, Mr Marando advised Mr Lyons by letter that Magenta did not have the timesheets that Mr Lyons had requested. The following day, however, Mr Marando sent a further letter stating there had been a misunderstanding and attaching the timesheets.
2.On 31 August, Mr Marando responded to the complaint that the particulars sent on 3 July 2012 did not differentiate between the causes of action, attaching a table which showed the damages claimed by reference to each cause and the relevant paragraphs of the statement of claim. Mr Marando also identified documents in the discovery which set out how the sums claimed had been arrived at. This was not a case which required calculation to be carried out by Ms Moredount, as Magenta was claiming the whole of the fees which it had set out in its submission when seeking the particular work.
On 4 September, I ordered that Ms Moredount's application be adjourned to a date to be fixed and required that the parties confer and provide a memorandum of conferral before it was relisted.
The parties again conferred by letter. Magenta agreed to plead the tables it had previously provided and proposed that the application be dismissed with costs in the cause. In a letter of 19 September 2012, Mr Marando requested Mr Lyons to telephone him to confer on issues which the defendant contended were still contentious, and to advise of Mr Lyons' availability to confer in respect of any other outstanding matters.
On 7 February 2013, Mr Lyons, again by letter, responded to the letter of 19 September. He confirmed that the discovery issues had 'largely' been resolved. In relation to particulars Mr Lyons wrote:
We are however not satisfied with the response you provided in your letter of 19 September 2012. In our view the tables that you have provided as being particulars of loss are not particularly helpful and in any event will need to be pleaded.
The matter came before me on 22 March, with the question of particulars still in issue although, so far as I can tell from all of the material put before me, there had still not been any face‑to‑face or telephone conferral. In an affidavit sworn 28 March 2013 Mr Lyons said:
I am unable to recall precisely why I did not respond to Mr Marando's telephone calls between 22 February and 27 February 2013. I know I received at least two messages that he had called. It did appear to me at that time there was little point in any further discussions as the plaintiff's position continued to be that the form of particulars given and the reference to discoverable documents was adequate.
I had formed the view that in any event our submissions put the defendant's position quite clearly and succinctly. We had been having an argument since 2011 about the inadequacy of their particulars.
It was only on the morning of 22 March 2013 when reading [an annexure to an affidavit of Mr Marando] that I realised for the first time that the two previous sets of particulars were now obsolete and that the plaintiff should rely entirely on the tables which had been provided.

Resolution of the application

First, the failure of the defendant to confer as required by O 59 r 9 would itself be a sufficient reason to not make the orders it seeks. The whole point of the conferral process is to have the parties talk to each other. Exchanges of correspondence, sometimes months apart, in which there is simply a repetition of the request or claim made in the earlier letter is pointless. There has still been no adequate conferral.
Second, the particulars provided by Magenta are not formal, in the sense that there is no filed statement of the complete particulars on which it relies. But Magenta had offered to file the table it had provided on 31 August 2012, and it had filed a statement of further and better particulars.
The current position is that:
1.Magenta has provided a table identifying the amount of damages claimed for each cause of action by reference to each specific paragraph in the statement of claim. For most of those claims Magenta claims only nominal damages. But where actual damages are sought for breach of contract, or breach of equitable duty, the amount sought is stated. Magenta offered to plead that table.
2.Magenta filed particulars which specify the amount claimed by reference to fees which it would have received on the two projects.
3.Magenta has referred to the documents upon which it has based its claim. It is not a case where it is necessary for the defendant to make a calculation from the content of the document referred to. Magenta has claimed the whole of the amount which it says it would have earned on the project, and has identified the fee submission which it made in an attempt to obtain the work. Magenta says, in effect, that as a result of Ms Moredount's breach of contract it lost the whole of that fee income.
I am satisfied that Ms Moredount has all she needs by way of proper notice of the claim she has to meet. An order is unnecessary and the application will be dismissed.
I am satisfied on the material provided by Jackson McDonald in correspondence, and by its conveyed request for Mr Lyons to contact Mr Marando to discuss any matters still in contention, that the matters in dispute between the parties could have been resolved had Ms Moredount's legal advisers been prepared to discuss the application with those acting for Magenta.
The purpose of an award of costs is to compensate the successful party. In the present case, I am satisfied that Magenta has been substantially successful and that it has incurred costs as a result of Ms Moredount pursuing an application which could have been resolved by conferral by, at the latest, 23 August 2012 when Ms Moredount brought her application. It is unnecessary to add that it should have been resolved.
The defendant should pay the costs of the application, including reserved costs, from 23 August 2012, to be taxed if not agreed. The costs up to 23 August 2012 will be in the cause.