Maggbury Pty Ltd & Anor v Hafele Aust Pty Ltd

[2001] HCATrans 129

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B46 of 2000

B e t w e e n -

MAGGBURY PTY LTD and GISMA PTY LTD

Applicants

and

HAFELE AUSTRALIA PTY LTD and HAFELE GMBH & CO

Respondents

Application for special leave to appeal

KIRBY J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

FROM BRISBANE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 4 MAY 2001, AT 2.49 PM

Copyright in the High Court of Australia

MR S.J. LEE:   If the Court pleases, I appear for the applicants.  (instructed by O’Shea Corser & Wadley)

MR G.C. McGOWAN:   If the Court pleases, I appear for the respondents.  (instructed by Logie‑Smith Lanyon)

KIRBY J:   Yes.

MR LEE:   Your Honours, the Court of Appeal erred in two ways, the first in holding that these contracts were subject to the restraint of trade doctrine at all.  It has been established since Prince Albert v Strange that the owner of materials embodying information has the right to limit by lawful means the extent to which those materials are disseminated to or used by others and also that no one else can question the owner’s reasons for doing so, not even if the information is worthless or unsaleable.

Those lawful means include the right to make a contract in which another agrees not to use those materials, except for a limited purpose.  If so agreed, such promises may lawfully protect the materials, even though they have, with the owner’s consent, been communicated to the public.  The reason is that to apply the restraint of trade doctrine would require the court to review the owner’s subjective decision as to the extent to which he/she wishes to disseminate the materials.  To put that in a way that makes sense on these facts, the Court of Appeal held that at application book, page 69, lines 21 to 23:

that protection of commercial information which –

Maggbury -

has made public goes beyond what the legitimate interests of –

Maggbury –

require.

But here Maggbury decided that it could commercially exploit its product, even though the details of the board had been disclosed in various ways to some members of the trade.  To limit the promises, despite their terms, so that they only subsist for so long as the information remained confidential, would not sufficiently protect Maggbury in its objective.  Your Honours, there are four lines of authority ‑ ‑ ‑

KIRBY J:   I understand the proposition, but I must confess the injunction actually granted, open‑ended as to time and unlimited as to place, in a practical context in which the information is substantially or wholly in the public domain, seems difficult to sustain.

CALLINAN J:   And, Mr Lee, in the public domain as a result ‑ ‑ ‑

MR LEE:   I cannot hear, your Honour, I am sorry.

CALLINAN J:   And in the public domain as a result of your clients’ agreement with the respondents, because did your clients not agree to, or at least acquiesce in the exhibition of this device at trade fairs?

MR LEE:   That is correct, your Honour Justice Callinan, but here the contract on its terms expressly extended that far and no case has ever been made of waiver or estoppel or any similar doctrine.  Here the question of the reasonableness of the contract does not arise.  It is simply a question of whether the restraint of trade doctrine applies at all.  There are four lines of authority which directly conflict with the Court of Appeal’s decision.  I will start with the case at tab 6 ‑ ‑ ‑

KIRBY J:   Before you embark on that, do you support the injunction as made?

MR LEE:   Yes, your Honour.

KIRBY J:   Unlimited in space and time and despite the fact that information the subject of the agreement between the parties is in the public domain and as a result of your clients’ action?

MR LEE:   Yes, and that has been done before.  Such injunctions have been granted before.  The first is at tab 6, your Honours, Exchange Telegraph v Central News.  That was one of several English cases where newsagencies purchased telegraphic news of already public events and on sold it to subscribers on terms that they not disclose the information to anyone else.  At page 53 point 5 the Chancery Division, following an earlier Court of Appeal decision, said:

On the other hand, it was said first of all that here the information had become public to the word at Manchester –

that is where the races had been run –

and there could be no property in it.  But the information was not made known to the whole world; it was no doubt known to a large number of persons, but a great many more were ignorant of it.  By the expenditure of labour and money the plaintiffs had acquired this information, and it was in their hands valuable property in this sense – that persons to whom it was not known were willing to pay, and did pay, money to acquire it.  The plaintiffs were at full liberty to communicate that information upon such terms as they saw fit –

and they did so subject to an express promise not to communicate the news to anyone else, and the court said:

A subscriber who communicated the information to third parties contrary to those terms would commit a breach of contract, and might be restrained –

and a perpetual injunction was granted in that case and in other cases like it which are in the outline.  The second is the English Court of Appeal decision in Lamb v Evans, which is at tab 8.  This concerned a breach of the implied duty of good faith by an agent who used his employer’s wooden printing blocks for purposes other than printing advertisements in the employer’s directory.  At page 237 at about point 2 Lord Justice Kay, after citing Prince Albert v Strange, says:

Mr Farwell has very ingeniously said . . . where the materials were to be obtained for the purposes of a publication which was given to the world, assuming that he could not use them until the publication has been given to the world, why should he not use them when it has been?  I beg leave to answer that argument in the words again of Lord Justice Turners . . . in Morison v Moat.  He said:  “It was much pressed in argument on the part of the defendant, that the effect of granting an injunction in such a case as the present would be to give the plaintiffs a better right than that of a patentee . . . but what we have to deal with here is, not the right of the plaintiffs against the world, but their right against the defendant.  It may well be, that the plaintiffs have no title against the world in general, and may yet have a good title against this defendant.”  That seems to me a complete answer.

At page 236 point 7 Lord Justice Kay crucially says that this doctrine extends to materials and he says:

(I use the word advisedly, because it would be very difficult indeed to grant an injunction to prevent a man using his knowledge) –

that is the crucial discrimen in this case.  These contracts only apply to records of information, namely, prototypes, photographs, drawings.  The third decision is a decision of this Court, Federal Commissioner of Taxation v United Aircraft.  That is at tab 9.  This concerned a tax point and it is really dicta, I suppose, that I am relying on.  At page 546 point 4 I would ask your Honours to turn to, but while your Honours are doing that, in that case United gave a licence to a company to manufacture aeroplane engines using United’s drawings, blueprints, parts and tools, on express terms that the licensee would not use the information for any other purpose.  At page 546 point 4 Justice Williams, who dissented on the tax point but not affecting this point, says:

But, supposing that the knowledge is not such that it is patentable –

then he says some other comments, the manufacturer:

cannot still retain a monopoly in fact in his knowledge by only disclosing the manner of manufacture under such circumstances that those to whom it is disclosed are under an obligation, express or implied, only to use the knowledge for the purposes for which it has been disclosed to them.

If the party to whom the disclosure is made, in breach of the contract, threatens and intends to disclose the information, equity will restrain the threatened wrong by an injunction.  If he has disclosed the information, the other party can sue the wrongdoer and the person to whom the disclosure was made for an injunction to prevent any use being made of the disclosure, or he can sue the wrongdoer for damages –

At pages 547 and 549 Justice Williams cites with approval Prince Albert v Strange and also Lamb v Evans.  I will not take your Honours to those passages specifically.  Chief Justice Latham at page 535 point 8 to over the page, 536, at point 1 of the page – I apologise for the numbering.  It does not appear to be apparent on the right-hand side.  But at the bottom of 535 point 8:

A person may be bound by contract express or implied to abstain from disclosing certain information to others.  Such a contract may be enforced by an award of damages or by injunction . . . All persons are perfectly free to acquire knowledge, even though that knowledge may at a given time be knowledge possessed by another person which he is keeping secret.  Subject to provisions contained in patent and copyright law, persons are entitled to use as they please any knowledge that they have unless they are bound by contract express or implied not to use it, or have acquired it by means of a violation of right – as in Albert (Prince) v Strange.

I rely on that case, although the dicta is broad because that concerned primarily objective materials and it was those facts that the Court was addressing.

CALLINAN J:   Mr Lee, your point is, is it not, that it is irrelevant that some or all of the information might be in the public domain.  You do not seek to enjoin the respondent from using anything that it obtains from the public domain.  You seek to enjoin it from using anything that it obtained from you.  Is that not right?

MR LEE:   Precisely, your Honour.

CALLINAN J:   And if they go off and use something in the public domain and can manufacture an ironing board from that, then you will have not any remedy.  But this is a case in which they actually used – you have a finding that they actually used your information and they had contracted not to use it.  Is that right?

MR LEE:   That is the precisely the case, your Honour.

CALLINAN J:   Yes, and that is not uncommon, is it, that people can be restrained from using information which they have wrongly gained, albeit that they may be able to use the same information, obtaining it from other sources?  For example, trade lists and things like that, sometimes if people can remember them, they can use them, so long as they do not take away an employer’s list.  Is that not right?

MR LEE:   Yes, and cases such as Louis v Smellie ‑ ‑ ‑

CALLINAN J:   Well, for present purposes, what about this point that his Honour Justice Kirby asked you about, because that may be an even more substantial hurdle for you, and that is the very breadth and scope of this injunction.

MR LEE:   Your Honours, the injunction of the kind that was given here, the second part of it which restrained use of information, is of a kind that is routinely made in that form.  Louis v Smellie in the Court of Appeal is such as case – it is the last case in the bundle – where the court expressly rejected the objection that difficult questions might arise on a contempt motion.  It granted the relief because of a contractual promise not to use the information and it granted it in that wide form.

KIRBY J:   Mr Lee, there are two questions that occur to me.  Both are interrelated.  One is, given the scope of the injunction, is the injunction too wide?  Well, you answered me that you supported the injunctions made.  But, secondly, given the scope of the injunction, does that not raise the issue of restraint on trade, which makes it look unrealistic to grant an injunction in those terms, given that the information is now available to all and sundry in the public domain, so it is said.

MR LEE:   No, your Honour.

KIRBY J:   In other words, in the exercise of your discretion, would you issue such an injunction, given that this information is now available, whatever may have been the position earlier?

MR LEE:   Well, firstly, your Honour, in terms of the restraint of trade doctrine, it has been held here by the trial judge and affirmed by the Court of Appeal that on the construction of these agreements they do not stop the respondents from going out and getting the information from a public source, or even from their own pre‑existing knowledge.  So as a matter of fact it does not operate as a restraint on the respondents’ trade.  Even though we might have provided this information to them, they are perfectly free to get similar information from elsewhere.

On the question of the discretion, the error which the Court of Appeal made here, with respect, is that they approached it as a general equitable exclusive jurisdiction question.  They did not approach it as a case where there was an express negative covenant.  I have cited all the usual authorities, your Honours, such as J.C. Williamson v Lukey ‑ ‑ ‑

CALLINAN J:   Louis v Smellie supports you in that in the judgment of Lord Justice Lindley at page 228, where his Lordship points out that the defendant could carry on the business, in effect, by using what he knew, but he could not carry on his business as a former employee by using materials actually taken from his former employer, the plaintiff.  Is that not right?

MR LEE:   It is a – I am sorry, your Honour.

CALLINAN J:   Is that not right?

MR LEE:   It is a distinction that appears in a lot of these authorities, but injunctions are granted nevertheless.

CALLINAN J:   What about the duration of the injunction?

MR LEE:   In Deta Nominees, your Honours – that is the fourth case; it is at tab 10 – there a perpetual injunction was granted.  Now, even though ‑ ‑ ‑

CALLINAN J:   What was the duration of the injunction in Louis v Smellie?

MR LEE:   Well, there is no limit.  I think it was a case concerned with the implied term of good faith, and like in Lamb v Evans it was just granted as a perpetual injunction.

CALLINAN J:   There was no restraint upon its duration, or no restrictions?

MR LEE:   No, but I do not rely on that case other than to say that as a matter of discretion, the fact that difficult questions might arise on contempt, it is not of itself a problem.  Your Honours, Deta Nominees was a case where the confidence only justified a springboard injunction for one year, but Justice Fullagar of the Supreme Court of Victoria granted a perpetual injunction, at page 195 point 7 and onwards, even though there the plaintiff had acquiesced in the publication of a patent by the defendants, and that is why the equity injunction would only have gone for one year as a springboard, but in enforcement of an express negative contract a perpetual injunction was granted.  I know my time appears to be up, but the major problem ‑ ‑ ‑

KIRBY J:   No, I think you have about three minutes left.

MR LEE:   Your Honours, the major problem here is that my friends concede that the Court of Appeal’s decision was wrong.  The Court of Appeal’s decision seems to assume that you can never protect by contract a property embodying information which is publicly available.  That is the way they ran their case below.  Now they are conceding that you can protect publicly‑available information but that it is subject to the restraint of trade scrutiny.  There is a massive inconsistency there, especially given that the cases I have cited ‑ ‑ ‑

KIRBY J:   Well, it may be inconsistent, but people sometimes ultimately see the light.  It has happened to me from time to time.

MR LEE:   Yes, your Honour, but ‑ ‑ ‑

KIRBY J:   And if you see the light, then perhaps what we have to ask ourselves is:  is it fair to your client to bring your client up to the High Court if we were of the view, tentative necessarily, that at the end of the day he is not going to get any different order, because the relief might on different grounds be refused?

MR LEE:   The respondents’ fall‑back argument is itself one which has been described by the Full Federal Court as untenable, because you have this line of cases that I have cited which do not mention the restraint of trade doctrine, except dicta by Chief Justice Latham elsewhere in his judgment.  To say that the restraint of trade doctrine is of universal application is no longer tenable.  To answer your Honour’s question specifically, even if no injunction were ultimately upheld, restoring the validity of the contract itself would entitle the applicants to $25,000 plus damages in lieu of injunctive relief to be assessed.

The question is of general application because for the first time, even contracts which are limited to confidential information or contracts which have a time limit where the information is, in fact, confidential, they for the first time will be subject to restraint of trade scrutiny.  I am here confining myself to cases concerned with protection against the use of information embodied in materials.  So it is not just the case where you have unlimited clauses that this can arise.  My outline deals with other impacts and, your Honours, the fact that many contracts may limit the protection to confidential information, does not mean that you cannot have a contract which, on its construction, extends to information which is not confidential.

The House of Lords’ decision relied on by the Court of Appeal, Mustad v Allcock and Dosen, was, in fact, such a case.  If you look at the Court of Appeal’s judgment in that case, it shows that the contract was so limited, the injunction asked for was, in fact, only to protect trade secrets.  So the Court of Appeal’s, in this case, reliance on Mustad is an error.  Your Honours, there is no factual issue here either.  It does not matter, on my submission, whether the information is trivial or publicly available, the contract is still valid, and that has to be decided.

Finally, I would ask your Honours to take into account injustice to the applicants, firstly, in that the reasons of the Court of Appeal are not satisfactory and they themselves rely on an argument which the respondents now say is incorrect.  Secondly, if the Court of Appeal’s decision is wrong, even on validity only, the respondents have breached a contract and, by doing so, have got their product onto the market first before my clients were able to when they were negotiating for two years and this was a case, after all, where the trial judge upheld the validity of the contract.  Thank you, your Honours.

KIRBY J:   Thank you for your assistance, Mr Lee.  Yes, Mr McGowan.

MR McGOWAN:   If the Court pleases, in our submission, all the cases my learned friend has found concerning injunctions that come anywhere close to the ones that were ordered here are based on quite different principles.  Here, of course, the applicant chose or agreed or acquiesced, endorsed, the publication of the relevant information.

CALLINAN J:   Yes, but did not agree your clients using it.

MR McGOWAN:   That is so, your Honour.

CALLINAN J:   Indeed, your clients covenanted not to use it.

MR McGOWAN:   Indeed, your Honour.

CALLINAN J:   So is it not irrelevant that Mr Lee’s client may have permitted some publication or public exposure of it?

MR McGOWAN:   Well, it endorsed all of it, including a patent application, which all the courts agree disclosed all the relevant information.  So the applicant will never be without entirely rights if the patent is good.

CALLINAN J:   Yes, but did you rely upon some of kind of estoppel or something of that kind?

MR McGOWAN:   In what sense, your Honour, I am sorry?

CALLINAN J:   That the applicant was estopped from raising any point against you of reliance.

KIRBY J:   Having acquiesced in the information being put in the public domain, it was in some way estopped from securing relief against you in respect of the same information?

MR McGOWAN:   I honestly cannot recall whether that was raised or not, your Honour, I am sorry.

KIRBY J:   Well, leave aside what you asked.  The case that was cited by Justice Callinan – I forget the name of it – an English case ‑ ‑ ‑

CALLINAN J:   Louis v Smellie.

MR McGOWAN:   Louis v Smellie.

KIRBY J:   ‑ ‑ ‑ does appear to sustain as differentiated the principle of restraining those who bind themselves to respect the confidences that are given to them and the fact that the information is in the public domain.  You could use information in the public domain, but you just cannot use the information that you have covenanted not to use.

MR McGOWAN:   Yes, that argument was run in the Court of Appeal.

CALLINAN J:   And also, Mr McGowan, it is not an unfamiliar problem in this field of discourse for a court to have to distinguish between, whether for contempt proceedings or otherwise, what is being used legitimately, whatever its source, and what is being used illegitimately because it is being used in breach of some obligation.  That not infrequently happens in this area, the sort of case that I put to Mr Lee, and, indeed, Louis v Smellie was itself a case of that kind.

MR McGOWAN:   Yes.

CALLINAN J:   In other words, with respect to the Court of Appeal, the fact that it might be a somewhat hard exercise to do on contempt proceedings is not entirely persuasive to me at this stage.

MR McGOWAN:   Your Honour, there are at least two essential points of distinction between here and Louis v Smellie.  One is that ‑ ‑ ‑

CALLINAN J:   Well, do not worry about Louis v Smellie.  Look at the principle which is, I think, as I have put it to you.

MR McGOWAN:   Yes, certainly.  The principle we say is that there have been no cases similar to the present circumstances where permanent and unlimited injunctions have been ordered, that is, they have not had the combination of features of publication by the applicant, no payment for the promise to keep the information confidential – there has been no payment in this case at all ‑ ‑ ‑

CALLINAN J:   No, but there was consideration because your client was put in a preferred position with respect to the negotiations with the applicant.

MR McGOWAN:   The consideration, we say, is rather imaginary because truly characterised it was merely a promise to disclose information ‑ ‑ ‑

CALLINAN J:   But it might have been a very valuable promise.  Courts do not evaluate the promise in this situation.  If there is a promise sufficient to support the consideration, that is enough.

MR McGOWAN:   Well, your Honour, my learned friend has not pointed to any cases where a promise like this has been given for no money.  Deta, there was significant money paid.  Louis v Smellie, there was an employment contract.

CALLINAN J:   But is a question of – we are not concerned with questions of adequacy of consideration.  There were reciprocal promises and they are sufficient to support the consideration in this case.  Are you inviting us to look at the adequacy of the consideration?

MR McGOWAN:   Well, Justice Gibbs says that it is an appropriate element to take into account.

CALLINAN J:   In what context?

MR McGOWAN:   He indicated that – and I have extracted the passage in the submissions on 107, note 60 from the Amoco v Rocca Case, where his Honour found that the quantum of consideration received by the covenantor was relevant in the assessment of the reasonableness of the restraint.

CALLINAN J:   In considering a case involving the application of the restraint of trade doctrine?

MR McGOWAN:   Yes.

CALLINAN J:   Yes.  But not otherwise?  You see Mr Lee has an anterior point that the restraint of trade doctrine does not apply to this case.

MR McGOWAN:   Your Honour, as for the application of the doctrine, the authorities have been talking about various possible approaches.  For example, in Esso v Harper’s Garage there were three approaches discussed and one of those approaches, the trading society approach, in truth is an exclusionary principle rather than a positive principle, that is, it is only where the applicant can show that the contract or the arrangement is part of the normal trading society that the doctrine should be excluded.

CALLINAN J:   Yes, but, as you have said, there are three approaches.

MR McGOWAN:   Indeed, your Honour.

CALLINAN J:   This matter has just been before this Court.  There is a decision reserved in relation to this, a case of Petersville.  I do not know – I mean, which of the three approaches do you want us to adopt and, indeed, are we confined to those three approaches in this jurisdiction?

MR McGOWAN:   The highest I can put it, your Honour, is that the latest decided authority of which I am aware is the ACT v Munday Case of the Full Federal Court which preferred the trading society test after canvassing all of the authorities.  But, in our submission, it probably does not matter which approach is adopted because ‑ ‑ ‑

CALLINAN J:   Except I thought Lord Pearce’s view accorded much more weight to the contract between the parties than the two other views that were expressed.

MR McGOWAN:   Yes, and there is a lot of discussion in the authorities about the competing values of those approaches, but probably from about Quadramain v Sevastapol onwards there has been a type of preference for the trading society test and ACT v Munday has certainly, at the intermediate level, expressed a clear preference for that approach and that is an exclusionary approach, namely, it is prima facie applicable unless you can exclude it.

CALLINAN J:   Let us assume you are right about that.  There is still the question whether – and this may, indeed, be a special leave question, I do not know – the restraint of trade doctrine applies to this situation.  Mr Lee’s submission is that it does not.

MR McGOWAN:   Yes, I understand that, your Honour, but we say that it is a question of fact, namely, is it a type of dealing that attracts the restraint of trade doctrine?  The Full Court said it did and we say that to second‑guess that is to reconsider the facts rather than matters of principle because the principles about, not only the application of the doctrine, whether it applies, but in what circumstances it is reasonable, are fundamentally questions of fact.

CALLINAN J:   Did the Court of Appeal reverse any of the findings of fact of Justice Byrne?

MR McGOWAN:   I think it is fair to say not relevantly, your Honour.

CALLINAN J:   No.

KIRBY J:   What do you say about the concluding points made by Mr Lee concerning the matter of justice?  I have never seen “The Castle” myself, but it does have a look, a tantalising look, about it as being of a small Australian battler who invents something very useful and you come along and you are a big international conglomerate and you promise him that you will not use his particular information, except in certain circumstances, and then you go ahead and use it.  Why should an Australian court not protect him and hold you to your promise?

MR McGOWAN:   Your Honour, I understand the point but the Court of Appeal made it clear that – well, can I put it in the colloquial?  It slapped my clients on the wrist for taking information in breach of the contract and imposed, in effect, a fine for it, $5,000.

CALLINAN J:   A derisory fine?

MR McGOWAN:   Yes.

KIRBY J:   It is contemptible the amount.

MR McGOWAN:   I am sorry, your Honour?

KIRBY J:   It looks a contemptible amount.

MR McGOWAN:   A very small amount, yes, and the basis of that ‑ ‑ ‑

KIRBY J:   Contemptuous, contemptuous.

CALLINAN J:   There was no claim for exemplary damages here?

MR McGOWAN:   I do not believe there was, no.  The basis of that was the Court of Appeal took the view that what was, in fact, taken was a slim basis for damages.  In other words, both the trial judge and the Court of Appeal said that everything was public, when the inventor, Mr Allen, was asked, “What was taken that was not published in the patent or published otherwise?”, he said, “Nothing”, and the trial judge said, “Well, I find that the particular combination” – and he listed the items – “were the things that were of value”.  And the Court of Appeal said that is a very slim basis for damage.

KIRBY J:   I just do not understand how, having decided to set aside the injunction, if they came to the view that a proper remedy was equitable damages, that they would not send that back to be tried on evidence instead of plucking a figure out of the air and imposing it themselves.  I could understand the reasons of finality that would lead them to try to do such a thing, but it does not seem to be very principled.

MR McGOWAN:   Well, there is no assistance – that is true – from the decision, but the decision does say that what was taken was a slim basis for damages and there were not relevantly any contests on the facts about the value of what was taken.  Even the primary judge imposed a $25,000 figure for damages and, of course, my clients had been restrained for about 18 months or so before the injunction was lifted by the Court of Appeal.  So, all in all, my client has suffered as a result of its breach and on balance we say the Court of Appeal struck a fair type of balance.

KIRBY J:   Yes.  Is there anything else that you need to say to us that is not in the written submissions?

MR McGOWAN:   One thing.  My learned friend criticised some omissions from the Court of Appeal’s decision as demonstrating that there was no consideration.  We say that silence does not demonstrate the court failed to take things into account.  It just means that it did not explain it.  We say that, at best, granting special leave would amount to asking the High Court to give a proper approach guide, which we say is not a proper basis for leave in these cases.

CALLINAN J:   We do it all the time.  We do it all the time, do we not?

KIRBY J:   It is our job.

MR McGOWAN:   Well, not when there is a great bank of authority for guidance already that has started to crystallise ‑ ‑ ‑

KIRBY J:   Most of it English authority.

CALLINAN J:   And you tell us yourself that, as, indeed, is right, there are three quite different, and I suggest irreconcilable, approaches in the House of Lords as to what is the appropriate test in restraint of trade cases.

KIRBY J:   You might have wandered into a very big case here, Mr McGowan.

MR McGOWAN:   Which have been dealt with in, for example, Quadramain v Sevastapol and, more recently, in ACT v Munday expressing ‑ ‑ ‑

CALLINAN J:   But not in this Court.

MR McGOWAN:   Well, Quadramain v Sevastapol was.

CALLINAN J:   Yes, but ‑ ‑ ‑

MR McGOWAN:   Expressing a pretty clear preference for one of the approaches.  If the Court pleases.

KIRBY J:   Anything in reply, Mr Lee?

MR LEE:   Just briefly, your Honours.  I do not press the allegation that the Court of Appeal failed to consider certain cases and that their reasons were as a matter of law inadequate but I do ask your Honours to take that into account on the question of injustice, given that they were not all that satisfactory.

Your Honours raised the concern about the injunction.  I would say this, that my opponents have never raised as a complaint that the exercise of discretion miscarried as such.  They have always argued that injunctions can never be given governing information which is publicly available or trivial.  They have never said if you can do that, then the trial judge’s discretion miscarried.  The trial judge, after all, did exercise a discretion.

The other grounds of complaint they did make against the discretion were rejected by the Court of Appeal, so this Court does not have to exercise its discretion on facts governing that injunction.  It simply has to find that the Court of Appeal itself asked the wrong question and then the orders can be set aside.  As Dignan’s Case says, this Court is only concerned with the question whether the Court of Appeal was right at the time the decision was made.

In terms of restraint of trade, this is rather like a restrictive covenant case.  My client had objective materials in which it had property.  The respondents never had a property right to those materials, they never had a licence, and that is one of the few issues of fact that the Court has to take into account.  There is no wide‑ranging question of reasonableness here, as my friend seems to suggests.  In terms of the size of the damages, the issue here is that the respondents copied the combination of features ‑ ‑ ‑

KIRBY J:   What did you ask for?  Was that issue addressed in the Court of Appeal or not, as to what should happen?

MR LEE:   I beg your Honour’s pardon.  I cannot hear you.

KIRBY J:   Was that issue addressed in the Court of Appeal as to what was to happen if the Court of Appeal were of the view that the injunction had to go but that some relief was appropriate?  Did you acquiesce in the Court of Appeal substituting their estimate of the damages as equitable damages?

MR LEE:   Not at all.  That was really quite extraordinary.  We did not acquiesce in that at all.

KIRBY J:   Were there written submissions on that point, on the quantification of the damages or on the proper approach to equitable damages or on the evidence that was relevant to it?

MR LEE:   At the trial we made submissions on that but it was not necessary for the appeal, which, after all, was brought by the respondents, because the trial judge only decided the case on contractual grounds.  Your Honours, I should make the point that what was copied here, which matters to the applicants, is the combination of features was copied.  That may well have been in the public domain and not accounted for, therefore, in the $5,000 award, but it was nevertheless copied, and that was a significant feature.

I should say that my friends have admitted before the Court of Appeal that this case is one that raises important legal issues.  They admitted that when they applied for a stay.  Unless there is anything further, your Honours.

KIRBY J:   Yes, thank you very much, Mr Lee. 

There will be a grant of special leave to appeal in this matter.  We will now adjourn, having finished the list.

AT 3.28 PM THE MATTER WAS CONCLUDED