Maxilift Australia Pty Ltd v Donnelly - [2019] SASC 115

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
MAXILIFT AUSTRALIA PTY LTD v DONNELLY
[2019] SASC 115
Judgment of The Honourable Justice Nicholson
5 July 2019
COURTS AND JUDGES - CONTEMPT - PARTICULAR CONTEMPTS - BREACH OF UNDERTAKING TO COURT - GENERALLY
COURTS AND JUDGES - CONTEMPT - GENERAL PRINCIPLES
The plaintiff brought an application pursuant to rule 303 of the Supreme Court Civil Rules 2006 (SA) that the defendant to be charged with contempt of court.
The defendant was previously employed by the plaintiff as a salesperson and commenced employment with a competitor company. An interlocutory application was filed seeking a declaration that the defendant is in contempt of court due to alleged breaches of an undertaking that the defendant had made to the Court. The defendant’s undertaking concerned use of the plaintiff’s confidential information and the defendant’s relationships with customers and contractors of the plaintiff during identified timeframes. The alleged breaches of the undertaking were in the form of communications between the defendant and the plaintiff’s customers and contractors. Whether there are reasonable grounds to suspect the defendant of the alleged contempt.
Held:
1. Pursuant to rule 303(7) of the Supreme Court Civil Rules 2006 (SA), the plaintiff has permission to issue a Summons to the defendant, in the form of Annexure A to these reasons, requiring the defendant to appear before the Court at a time nominated by the Registrar to answer the charge of contempt described in the Summons.
2. Costs reserved.
Supreme Court Civil Rules 2006 (SA) r 303, r 305, referred to.
Universal Music Australia Pty Ltd v Sharman Networks Ltd (2006) 150 FCR 110, applied.
Mane Market Pty Ltd & Ors v Temple [1998] SASC S6986; McDonald v State of South Australia [2008] SASC 309; Witham v Holloway (1995) 183 CLR 525, discussed.
Testel Aust P/L v Rickard & Ors [2017] SADC 31, considered.

MAXILIFT AUSTRALIA PTY LTD v DONNELLY
[2019] SASC 115
Civil: Application
NICHOLSON J.
Introduction and background

These reasons concern an application pursuant to subrule 303(1) of the Supreme Court Civil Rules 2006 (SA) (the 2006 Rules) by the plaintiff, Maxilift Australia Pty Ltd, that the defendant, Mr Donnelly, be charged with contempt of court.
The defendant was employed by the plaintiff as a salesperson, between 16 November 2009 and 10 November 2017. Prior to the defendant’s employment with the plaintiff he was employed by BG Crane Pty Ltd ACN 097 663 431 (BG Crane). This role involved managing sales on the northern New South Wales coast. On or about 7 March 2007, whilst the defendant was employed with BG Crane, the company changed its name to Hiab Australia Pty Ltd (Hiab). The defendant left Hiab to take up his employment with the plaintiff on 16 November 2009. On 8 January 2018, the defendant returned to employment with Hiab.
On 18 March 2010, after the defendant had commenced employment with the plaintiff, Hiab again changed its name to Cargotec Australia Pty Ltd (Cargotec).[1] However, Cargotec continued to trade intermittently under the registered business name “Hiab Australia”. In this judgment reference to “Hiab” will be a reference to Cargotec (formerly Hiab and BG Crane), being the company that employed the defendant prior to 16 November 2009 and which currently uses the registered business name “Hiab Australia”.
[1] Exhibit D1: Certificate of Registration of Thomco (No 2034) Pty Ltd, ACN 097 663 431.
Following the defendant resuming employment with Hiab on 8 January 2018, the plaintiff expressed concern about the defendant’s alleged misuse of the plaintiff’s confidential information. The plaintiff was concerned that its confidential information might be used by the defendant to obtain business from the plaintiff’s customers and contractors for the benefit of Hiab. Upon the plaintiff commencing proceedings in this Court, the defendant agreed to give an undertaking to the Court with respect to the plaintiff’s confidential information and the defendant’s relationships with the plaintiff’s customers and contractors. He denied misusing or having access to confidential information.
On 15 March 2018, the defendant gave an undertaking to the Court in the following form (the Undertaking):[2]
[2]    The Undertaking appears to have been initialed by Judge Dart and was filed on 16 April 2019.
This undertaking is given to the Supreme Court of South Australia by Craig Donnelly of 7 Park Avenue, Bray Park NSW 2484 (Defendant)
WHEREAS:
A.The Defendant was employed by the Plaintiff as a salesperson between 2009 and 2017.
B.During his employment, the Defendant had access to the Plaintiff’s Confidential Information.
C.During his employment, the Defendant created business relationships with the Plaintiff’s Customers and Contractors.
D.On 10 November 2017, the Defendant resigned from his employment with the Plaintiff.
E.The Defendant commenced employment with Hiab Australia Pty Ltd (Hiab), a direct competitor of the Plaintiff on 8 January 2018.
F.The Plaintiff has expressed concern over the Defendant’s alleged access to the Plaintiff’s Confidential Information during his employment with, and/or for the benefit of, Hiab.
G.The Plaintiff has also expressed concern about the alleged misuse of its Confidential Information to obtain business from the Plaintiff’s Customers and Contractors.
H.Donnolly [sic] has offered to give this undertaking with respect to Confidential Information and his relationships with the Plaintiff’s Customers and Contractors but denies any misuse of or access to any such Confidential Information.
THE DEFENDANT NOW UNDERTAKES TO THE COURT that:
1.He has not accessed, used or misused the Plaintiff’s Confidential Information;
2.He will at no to [sic] time in the future access, use, or misuse the Plaintiff’s Confidential Information; and
3.Between 10 November 2017 and 30 June 2018 he has not, and will not, communicate with, or accept any approach from:
a.     any Customer or Contractor with whom he had a business relationship through his employment with the Plaintiff that was not a pre-existing Customer or Contractor of Hiab with whom Hiab had dealings in the 12 months preceding 10 November 2017; or
b.    any individual at any Customer or Contractor with whom he had a business relationship through his employment with the Plaintiff, even if the Customer or Contractor was a client of Hiab with whom Hiab had dealings in the 12 months preceding 10 November 2017 (but for the avoidance of doubt, he can communicate with or accept any approach from any other individual at a Customer or Contractor that was a client of Hiab in the 12 months preceding 10 November 2017 with whom he did not have a business relationship through his employment with the plaintiff).
For the purposes of this undertaking:
4.Confidential Information means:
a.     information regarding employees, Customers or contractors of the Plaintiff, and any others who do business with the Plaintiff other than such information that is already in the possession of Hiab as a consequence of its dealings with any Customers or Contractor prior to 10 November 2017 or that is available in the public domain;
b.    ideas, know-how, concepts and information, whether in writing or otherwise; and
c.     all other information relating to the Plaintiff including its products, business, activities, finances, marketing or promotional information, policies and personnel,
including any information in the Plaintiff’s power, possession or control concerning or belonging to any other person.
5.Contractor means any person, entity or business with whom the Plaintiff deals and/or from whom the Plaintiff receives products and/or services, for reward.
6.Customer means any person, entity or business with whom the Plaintiff deals and/or whom the Plaintiff provides products and/or services, for reward.
The Undertaking, although given on 15 March 2018, was designed to operate both prospectively and retrospectively, and to encompass the period between 10 November 2017 to 30 June 2018.
The application
On 19 November 2018, the plaintiff filed an interlocutory application in the proceedings seeking, inter alia, a declaration that the defendant is in contempt of court. The plaintiff has alleged the following breaches of the Undertaking by the defendant.
1.Breaches of condition 3(a):
(a) During the period of 10 November 2017 to 12 April 2018 the defendant communicated with, or in the alternative, accepted approaches from customers or contractors (as defined in the undertaking) with whom he had a business relationship through his employment with the plaintiff, that was not a pre-existing customer or contractor of Hiab, with whom Hiab had dealings with in the last 12 months preceding 1 November 2017.
2.Breaches of condition 3(b):
(a) During the period of 10 November 2017 to 12 April 2018, the defendant communicated with, or in the alternative, accepted approaches from individuals at customers or contractors with whom he had a business relationship through his employment with the plaintiff.
Particulars of breach were provided in a document entitled “Particulars of Charge” filed by the plaintiff on 5 April 2019. These particulars are identified later in this judgment.
Legal principles relevant to the application
Rule 303 of the 2006 Rules sets out the required procedure where a party to a proceeding wishes to apply to have, inter alios, another party charged with contempt.
303—Contempt proceedings by party to proceeding
(1)A party to a proceeding who claims to have been prejudiced by a contempt of the Court committed by another party, a witness or another person in relation to the proceeding (the accused) may apply to the Court to have the accused charged with contempt.
(2) The application—
(a)     must be made as an interlocutory application; and
(b)     must include details of the alleged contempt.
(3) The application may be made without notice to the accused or other parties but the Court may direct the applicant to give notice of the application to the accused or the parties (or both).
(4) If the Court is satisfied on an application under this rule that there are reasonable grounds to suspect the accused of the alleged contempt, subject to subrule (7), the Court may require the Registrar to formulate a written charge containing reasonable details of the alleged contempt.
(5) The Registrar will then issue a summons requiring the accused to appear before the Court at a nominated time and place to answer the charge.
(6) The Court may issue a warrant to have the accused arrested and brought before the Court to answer the charge if—
(a)     there is reason to believe that the accused will not comply with a summons; or
(b)     a summons has been issued and served but the accused has failed to appear in compliance with it.
(7) Despite subrule (4), the Court may, if satisfied that there are reasonable grounds to suspect the accused of the alleged contempt, grant permission to the applicant to issue a summons requiring the accused to appear before the Court at a nominated time and place to answer the charge and, in that event, the applicant—
(a)     must, within the time fixed by the Court, issue and serve a summons in an approved form requiring the accused to appear before the Court at the nominated time and place to answer the charge;
(b)     must be named as the prosecuting party in the summons;
(c)     will have the carriage of the prosecution of the charge;
(d)     must prosecute the charge at its own expense and satisfy any costs orders made in favour of the accused;
(e)     must comply with any direction of the Court in relation to the prosecution of the charge.
By subrule 303(1) only a party to a proceeding who claims to have been prejudiced may apply to the Court for a charge of contempt to be laid. A charge of contempt is a quasi-criminal proceeding and must be proved beyond reasonable doubt.[3]
[3] Universal Music Australia Pty Ltd and Others v Sharman Networks Ltd and Others [2006] FCAFC 41; (2006) 150 FCR 110 at [15].
Rule 303 imposes a preliminary step before a charge of contempt can be laid. The applicant must first establish that there are grounds which justify a summons being issued. In determining whether there are reasonable grounds to suspect a person of the alleged contempt, the Court must determine whether there is “sufficient evidence which, if accepted, would prove the contempt”.[4] In Mane Market Pty Ltd & Ors v Temple,[5] with reference to an earlier form of the rule, Debelle J explained as follows.
When determining whether a Registrar’s summons should issue, the court is exercising a screening function somewhat similar to that exercised by a magistrate in committal proceedings in respect of a criminal offence. To make an order that a Registrar’s summons should issue, the court must be satisfied that there is sufficient evidence which, if accepted, would prove the contempt. When determining whether there is sufficient evidence, it must be remembered that there is no longer any distinction between civil and criminal contempts. All contempts should be punished as if they are quasi-criminal in character: Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 109, and the burden of proof in civil proceedings is proof beyond reasonable doubt: Witham v Holloway (1995) 131 ALR 401. The defendant refers to his [sic] definition of contempt in Rule 93.01(9) which includes as a contempt “any contumacious refusal to obey or comply with a judgment or order of the court”. He says that a Registrar’s summons should not issue because his breach of the order was not contumacious. He also says that the breach was inadvertent.
.  .  .  .
It is not appropriate at this stage to determine whether the breach is contumacious. There are two reasons for that conclusion. The first is that it is necessary for the court to determine no more than whether there is sufficient evidence which, if accepted, would prove the contempt. Secondly, the plaintiffs have given notice that they seek to cross-examine the defendant. There is a real dispute whether the defendant’s breach was inadvertent. The plaintiffs assert that the sale of the defendant’s interest in the trust was a deliberate act made with full knowledge and despite the terms of the injunction. It is not possible, therefore, to determine the issue until the relevant evidence has been led and tested. Finally, wilful disobedience of an order may constitute contumacious conduct and thus constitute a contempt: see the discussion in Mudginberri (supra) at 109 to 113. Evidence will be necessary to determine whether this was a wilful breach.
The definition of contempt in rule 4 of the 2006 Rules is in terms different from those of the definition before Debelle J. The word “contumacious” is no longer employed.[6] Nevertheless, his Honour’s explication of the general principles applicable to an interlocutory application of this nature remain apposite.
[4]    Mane Market Pty Ltd & Ors v Temple [1998] SASC S6986 at [5] (Debelle J).
[5]    Mane Market Pty Ltd & Ors v Temple [1998] SASC S6986 at [5]-[6].
[6]    The “inclusive” definition of contempt in rule 4 of the 2006 Rules is in these terms:
(a)a contempt in the face of the Court;
(b)disruption of the proceedings of the Court;
(c)obstruction or perversion of the course of justice—
(i)by intimidation of or interference with a witness; or
(ii)by making statements or publishing material that could prejudice the fair and impartial determination of proceedings before the Court; or
(iii)in any other way;
(d)obstruction or interference with the proper performance of official duties by an officer of the Court;
(e)deliberate non-compliance with a judgment or order of the Court;
(f)an attempt to do anything that would, assuming the attempt had been carried successfully to conclusion, have constituted a contempt under any of the above paragraphs;
When considering what inferences are available on the evidence which might support a prima facie case for the issue of a summons for contempt, the Court is not required to choose between inferences but is entitled to draw those which are reasonably open on the evidence and are most favourable to the party seeking the summons.[7]
As the plaintiffs have not yet proved that the withdrawal was made in breach of the injunction, they are not entitled to the first of the orders they seek. However, there is prima facie evidence of such a breach. In reaching that conclusion I have had regard to the fact that the plaintiffs' case against the defendant is circumstantial. In a case based on circumstantial evidence it is, I think, appropriate to apply the test when considering whether there is sufficient circumstantial evidence to constitute a case to answer by an accused person. Some force for that conclusion lies in the fact that the criminal onus applies on a charge of contempt. Thus, when considering whether there is a prima facie case to warrant the issue of a Registrar's summons, it is not the role of the judge hearing the application to choose between the inferences which may be fairly open to the judge who hears the summons. Instead, the judge must decide the question on the basis that the judge hearing the summons will draw such of the inferences which are reasonably open as are most favourable to the party seeking the issue of the Registrar's summons: cf R v Bilick (1984) 36 SASR 321; Questions of Law Reserved on Acquittal (No 2 of 1993) (1993) 61 SASR 1, 5 … .
[7] Mane Market Pty Ltd & Ors v Temple [1998] SASC S6986 at [17].
There is support in the authorities for a residual discretion to decline to permit contempt proceedings to go forward where a prima facie case is established. In McDonald v State of South Australia,[8] Sulan J held that regard should also be had to all the circumstances giving rise to the referral of the matter.
In considering whether to direct the Registrar to issue a summons, the Court should have regard, not only to whether a prima facie case of contempt has been made out, but also to all the circumstances giving rise to the referral of the matter. If a judge concludes that the breach is trivial, or if there are good reasons why the matter should not be referred to the Registrar to commence contempt proceedings, the judge has a discretion to decline to refer the matter. Factors including the reasons for the misconduct, the seriousness of such misconduct, and the personal circumstances of the person are relevant factors.
[8] [2008] SASC 309 at [16]. See also, Testel Australia Pty Ltd v Rickard & Ors (No 3) [2018] SADC 61 at [10].
In order for a charge of contempt to succeed, it will be necessary for the plaintiff, in due course, to prove to the criminal standard that the undertaking was breached. Whilst any such breach must be the result of intentional conduct, the plaintiff will not need to prove that the defendant intended to breach the undertaking. Nevertheless, proof of wilful or deliberate disobedience is likely to be relevant to penalty should a charge of contempt be established.[9]
[9] See generally, Universal Music Australia Pty Ltd and Others v Sharman Networks Ltd and Others [2006] FCAFC 41; (2006) 150 FCR 110 at [17]-[18].
The issues

During the argument, three main issues were in contention. First, has the plaintiff satisfied the condition in subrule 303(1) that it has suffered prejudice. Second, what, in material respects, is the proper construction of the terms of the Undertaking. Ultimately, such an understanding will be a necessary prerequisite to determining whether any conduct, as alleged, might be in breach of the Undertaking. Third, does the evidence give rise to reasonable grounds to suspect the defendant of the alleged contempt in breaching the Undertaking in one or more of the ways particularised by the plaintiff.
Is the plaintiff a party who claims to have been prejudiced by a contempt
The plaintiff has not, at this stage of the proceedings, asserted and there is no evidence that any alleged contempt by the defendant has caused or is likely to cause the plaintiff monetary loss.
Nevertheless, the plaintiff submitted that the requirement to be a party who claims to have suffered prejudice within subrule 303(1) is met by the fact that the Undertaking given by the defendant in order to protect the plaintiff’s interests has not provided the plaintiff with the relief intended because of the defendant’s breach. The plaintiff submitted that the prejudice requirement in subrule 303(1) is not to be equated to proved loss caused by a breach of the Undertaking.
The defendant submitted that the need to show prejudice was necessary to prevent the process from being used as a form of oppression where there is no real issue to be tried. In this case, there was neither evidence of prejudice or loss suffered by the plaintiff nor evidence of any gain obtained by either the defendant or Hiab. Further, the Court has a discretion, after considering all the circumstances, to find the breach to be trivial or that there are good reasons why the matter should not be referred.[10] The defendant submitted that this discretion is enlivened where there is no prejudice.
[10] McDonald v State of South Australia [2008] SASC 309 at [16].
Subrule 303(1) gives standing, for the making of an application to have a person charged with contempt, to a party to a proceeding who claims to have been prejudiced by the alleged contempt.
In Witham v Holloway,[11] McHugh J summarised the essential notion of contempt of court with reference to the now historical division between civil and criminal contempts.
The phrase “contempt of court” dates from at least the twelfth century. While it was not until the seventeenth century that the courts drew a distinction between civil and criminal contempts, the existence of the distinction has been firmly established since the middle of the last century. The distinction has been acknowledged or assumed in a number of decisions in this Court. Criminal contempts are acts or omissions that have a tendency to interfere with or undermine the authority, performance or dignity of the courts of justice or those who participate in their proceedings. Although criminal contempts take many forms, their characteristic attribute is an interference with the due administration of justice either in a particular case or as part of a continuing process. Defiance of the court or its procedures, publication of matters scandalising the court, actions calculated to prejudice the fair trial of a pending case, threats to parties or witnesses and misconduct within the court are examples of criminal contempts. Civil contempts, on the other hand, are concerned with failures to comply with judgments or orders of the courts. But civil and criminal contempt overlap. Thus, disobedience to the order of a court constitutes criminal contempt when the disobedience is contumacious. Defiance of the court’s order renders criminal what would be otherwise civil contempt. Where non-compliance with a judgment or order goes beyond mere breach and involves misconduct, civil contempt also has “a penal or disciplinary jurisdiction [that is] exercised by the court in the public interest”.
(Footnotes omitted)
[11] [1995] HCA 3; (1995) 183 CLR 525 at [8], 538-539.
The law of contempt is directed to the protection of the legitimate interests of courts and the legal system. Prejudice caused to a party, whether comprising monetary loss or otherwise, is not an element. Rule 303, apart from the reference in subrule 303(1) makes no further mention of prejudice much less any need to establish it. The balance of Chapter 14 of the 2006 Rules which governs the regime for the prosecution of contempt proceedings makes no reference to any such requirement.
Contempt proceedings can be initiated by the Court of its own motion in accordance with rules 301 and 302 or by a party to proceedings in accordance with rule 303. In the latter case it is necessary to have some filter or fetter in order to protect against contempt proceedings being deployed against an adversary as an instrument of oppression. Rule 303 achieves this in three ways. First, by limiting its reach to a party to proceedings – officious bystanders are precluded – second, by limiting its reach further to a party who claims to have been prejudiced and third, by requiring that party to establish reasonable grounds to suspect the alleged contempt before permission to proceed will be given. In addition, the Court has the overarching discretion, as described by Sulan J in McDonald, whether to allow contempt proceedings to be instituted.
In these circumstances, the requirement that the applicant party must claim to have been prejudiced should be seen as imposing a low threshold. In the present case, if the actions by the defendant said to constitute contempt are made out, the Undertaking given to the Court will not have been observed to that extent. The Undertaking, insofar as the plaintiff is concerned, is in the nature of injunctive relief. This type of relief is often apposite precisely because it can be difficult, if not impossible and very costly, to justify and prove damages for breach of an underlying contractual or equitable obligation. Ordinarily, a party is entitled to insist upon compliance with any injunctive relief or undertaking in lieu that has been procured.
Under subrule 303(1), an applicant party need only claim to have been prejudiced. The plaintiff in this case has satisfied this requirement.
The construction of the Undertaking
The structure of the Undertaking in condition 3(a) is as follows.
(i)Between 10 November 2017 and 30 June 2018, the defendant has not, and will not, communicate with, or accept any approach from:
(ii)any Customer (as defined) or Contractor (as defined);
(iii)with whom the defendant had a business relationship through his employment with the plaintiff;
(iv)that was not a pre-existing Customer or Contractor of Hiab with whom Hiab had dealings in the 12 months preceding 10 November 2017.
A potential difficulty with this structure is that “Contractor” and “Customer” are both defined “for the purposes of the Undertaking” in terms that describe a relationship between the qualifying person or entity and the plaintiff. As such, the use of these terms with reference to the defendant (as in (iii) above) is on its face anomalous unless the definitions are to be ignored for this purpose.
The structure of the undertaking in condition 3(b) is as follows.
(i)Between 10 November 2017 and 30 June 2018, the defendant has not, and will not, communicate with, or accept any approach from:
(ii)any individual at any Customer (as defined) or Contractor (as defined);
(iii)with whom the defendant had a business relationship through his employment with the plaintiff;
(iv)even if the Customer or Contractor was a client of Hiab with whom Hiab had dealings in the 12 months preceding 10 November 2017;
(v)but for the avoidance of doubt, the defendant can communicate with or accept any approach from any other individual at a Customer or Contractor that was a client of Hiab in the 12 months preceding 10 November 2017 with whom the defendant did not have a business relationship through his employment with the plaintiff.
It is to be noted that condition 3(b) uses the word “client” with reference to Hiab and thus avoids any textual problem that may arise by the use of “Customer” or “Contractor” with reference to Hiab as in condition 3(a).
The parties raised a number of issues concerning the proper construction of the Undertaking, particularly condition 3(b) thereof. Ordinarily, a final determination of the terms of the Undertaking and their proper construction will need to be arrived at before a final determination of the question whether any of the defendant’s conduct, if and once proved, constituted a breach of the Undertaking can be arrived at. However, the parties were in agreement that, at the present interlocutory stage, any dispute as to the proper construction of the terms of the Undertaking (where material to its application to the facts as relied on by the plaintiff) only needs to be addressed at the prima facie level. That is, I only need to be satisfied that the construction propounded by the plaintiff is reasonably arguable.
I adopt this position for the following reasons. First, it is consistent with the task before the Court which is only to decide whether to permit contempt proceedings to be commenced. In this respect, subrules 303(4) and (7) only require that the Court be “satisfied that there are reasonable grounds to suspect the accused of the alleged contempt”.
Second, given that these are interlocutory proceedings, any purported final determination of the construction issue would not be binding on a court that might ultimately come to hear the proceedings. This would be a fortiori in the case, as envisaged by subrule 303(3), where an application for permission under rule 303 were to be heard and determined ex parte.
Third, the position I have adopted is consistent with the approach and reasoning adopted by the Full Court of the Federal Court, albeit in a different context, in Universal Music Australia Pty Ltd v Sharman Networks Ltd.[12]
[12] [2006] FCAFC 41; (2006) 150 FCR 110.
The defendant made various submissions which, if accepted, would have the effect of narrowing or confining the ambit of the Undertaking, as propounded by the plaintiff, quite significantly. Nevertheless, I am satisfied that the contentions of the plaintiff as to the construction and ultimate breadth of the Undertaking are reasonably arguable. It would not be appropriate to go further and rule on the various arguments and counter-arguments put by the parties, much less formulate either an indicative or a final conclusion as to the proper construction of the Undertaking. For present purposes, the structure of the Undertaking as earlier set out is an adequate framework against which to assess the alleged breaching conduct by the defendant.
The evidence
There have been a number of communications between the defendant and clients of the plaintiff during the course of the defendant’s present employment with Hiab which the plaintiff submits are in breach of the Undertaking. In support of its contention that there are reasonable grounds to suspect the defendant of failing to observe the Undertaking, the plaintiff read and relied on the following affidavit evidence with respect to which there was no objection by the defendant.
(i)Affidavit of Nathan Cox affirmed 24 May 2018 (FDN[13] 16).
(ii)Affidavit of Michael McNamara affirmed 14 November 2018 (FDN 19).
(iii)Affidavit of Louise McNamara affirmed 14 November 2018 (FDN 20).
(iv) Affidavit of Kevin Schuhmann sworn 26 November 2018 (FDN 22).
(v)Affidavit of David Robertson affirmed 5 February 2019 (FDN 24).
(vi)Affidavit of Bridget Nunn affirmed 25 March 2019 (FDN 25).
[13] FDN is a Registry acronym standing for file document number.
The defendant argued that there are no reasonable grounds to suspect the defendant of the alleged contempt and that, at all times, he has complied with conditions 3(a) and 3(b) of the Undertaking. The defendant relied on asserted deficiencies in the plaintiff’s evidence and on the following affidavits which were read on the application without objection.
1.Second affidavit of Bridget Nunn affirmed 11 April 2019 (FDN 30).
2.Affidavit of Kymberly Davis affirmed 5 April 2019 (FDN 28).
3.Affidavit of Neil Thomas Spivey sworn 29 March 2019 (FDN 26).
4.Affidavit of Nathan Cox affirmed 24 May 2018 (FDN 16).
The proposed charges of contempt were particularised in a document entitled “Particulars of Charge” filed by the plaintiff on 5 April 2019. The plaintiff submitted that I should not proceed on the basis that the evidence presently before the Court is the evidence as it would stand in the trial. Rather, the presently available evidence is, of itself, sufficient to warrant a finding that there are reasonable grounds to suspect that each of the particulars establishes a contempt, such that the matter should be permitted to go forward in this form.
Particulars of the alleged contempt
The affidavit evidence taken at its highest is capable of supporting the following conclusions.
Particulars related to breach of condition 3(a)
Particular 1(a) – CraneServe
In or around January or February 2018, the defendant communicated with Mr Nathan Cox of CraneServe, a contractor of the plaintiff, regarding the installation of cranes. CraneServe is an entity within the plaintiff’s third party servicing network. During the defendant’s employment with the plaintiff he had a business relationship with Mr Cox. In or around January or February 2018, the defendant telephoned Mr Cox in relation to the installation of five Hiab cranes. Prior to this telephone call CraneServe had never performed any work for Hiab.
Particulars related to breach of condition 3(b) from 10 November 2017 to 12 April 2018
Particular 2(a) – Coffs Harbour City Council
On or around 10 January 2018, the defendant communicated with Mr David Robertson, a fleet coordinator at Coffs Harbour City Council, a customer of the plaintiff. Following this chance encounter, Mr Robertson asked the defendant for his new contact details. Coffs Harbour City Council has a long-term business relationship with the plaintiff. Mr Robertson had professional dealings with representatives of the plaintiff, including the defendant when he was employed by the plaintiff. The last Hiab crane purchased by the Coffs Harbour City Council was approximately five years prior to 2018.
Particular 2(b) – K&J Trucks Coffs Harbour
On or about 18 January 2018 the defendant had communications with, and/or accepted an approach from, Mr Kevin Schuhmann, the owner of K&J Trucks, a customer of the plaintiff. K&J Trucks has had business dealings with the plaintiff for a number of years. The first dealing Mr Schuhmann had with the defendant as an employee of the plaintiff was by an email dated 10 October 2012. For approximately five years thereafter, K&J Trucks consistently dealt with the plaintiff. The last direct contact from the defendant to Mr Schuhmann was an email on 23 October 2017 regarding an update on warranty repairs. The first time K&J Trucks had any business relationship with Hiab was on 15 January 2018 in an email between the defendant and Mr Quin of K&J Trucks Coffs Harbour.
Particular 2(c) – K&J Trucks Coffs Harbour
On or about 18 January 2018 at approximately 3:08pm, the defendant engaged in email correspondence with Mr Schuhmann with the subject line “RE – COFFS CITY COUNCIL TENDER”. Mr Schuhmann has deposed to the fact that he had email correspondence with the defendant on 18 January 2018 in relation to a quote for a Hiab crane.
Particular 2(d) – Coffs Harbour City Council
In or around January or February 2018, the defendant emailed to Mr Robertson of the Council the defendant’s new contact details after their chance encounter on 10 January 2018. They engaged in email correspondence that same day at around 9:58am and 12:07pm with the subject “Re: Hiab .99BDUO 2016”.
Particular 2(e) – CraneServe
In or around January or February 2018, the defendant communicated with Mr Cox by a telephone call placed by the defendant to Mr Cox regarding the installation of Hiab cranes. The defendant said words to the effect that he worked for Hiab and was looking for someone to install five Hiab cranes.[14]
Particular 2(f) – Vince McNamara Engineering and Sales (VME)
[14] This appears to be the same particular as also relied on as particular 1(a), being an alleged breach of clause 3(a).
On or about 27 February 2018 at approximately 2:17pm, the defendant corresponded by email with Michael McNamara of VME. An email sent by the defendant to Mr McNamara contained the subject line “re-Crane pricing – for Michael”. Mr McNamara is a part-owner and director of VME. He has a long history of communicating with the defendant as a representative of the plaintiff. During 2018, Mr McNamara received a series of emails from the defendant.
Particular 2(g) – VME
In or around March 2018, the defendant, by way of face-to-face discussion, communicated with Ms Rose-Anne Fletcher of VME at the premises of VME in South Lismore, New South Wales. In or around March 2018, Louise McNamara of VME was informed by Ms Fletcher that the defendant had attended at the office and asked to see Ms & Mr McNamara to introduce them to a Hiab sales representative.
Particular 2(h) – Coffs Harbour City Council
In or around March 2018, the defendant participated in a telephone conference between Mr Robertson, the defendant and a representative of K&J Trucks Coffs Harbour. Mr Robertson is employed by Coffs Harbour City Council which has had a long-term business relationship with the plaintiff. The defendant was known to Mr Robertson whilst the defendant worked as a sales representative of the plaintiff.
Particular 2(i) – VME
On or about 6 March 2018, the defendant communicated with Mr McNamara of VME by email sent by the defendant to Mr McNamara at around 8:50am with the subject heading “RE – DEMO TRUCK – K & J”.
Particular 2(j) – VME
On or about 22 March 2018, the defendant communicated with Mr McNamara of VME by email sent by the defendant to Mr McNamara at around 7:56am with the subject heading “RE – NATIONAL PARK CALS”.
Particular 2(k) – VME
On or about 27 March 2018, the defendant communicated with Mr McNamara by email sent by the defendant to Mr McNamara at around 1:02pm with the subject heading “Fwd: Rous Water Calculation C1982_O1A”.
Particular 2(l) – K&J Trucks Coffs Harbour
On or about 27 and 28 March 2018, the defendant communicated with Mr Schuhmann of K&J Trucks by emails sent at around 1:20pm and 5:26pm on 27 March 2018 and 9:25am on 28 March 2018 with the subject heading “Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO” or “Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO”.
Particular 2(m) – VME
In or around March to June 2018, the defendant communicated with Mr McNamara of VME by way of a face-to-face discussion at the premises of VME at in South Lismore, New South Wales. The discussion related to the provision of a crane for Rous Water.
Particulars related to breach of condition 3(b) from 13 April 2018 – 30 June 2018
Particular 3(a) – VME
By way of alternative to particular 2(m) above, in or around March to June 2018, the defendant communicated with Mr McNamara of VME by way of a face to face discussion at the premises of VME in South Lismore, New South Wales. The discussion related to the provision of a crane for Rous Water.
Particular 3(b) – VME
In or around late April 2018, the defendant communicated with Ms McNamara of VME by way of a face to face discussion at the premises of VME in South Lismore, New South Wales. The defendant told Ms McNamara he had been in contact with Northern Rivers Isuzu (NRI), a truck dealership, about replacing an existing Hiab crane through a tender process for a full truck build.
Particular 3(c) – K&J Trucks Coffs Harbour

On or about 30 April 2018, the defendant communicated with Mr Schuhmann of K&J Trucks by an email sent by the defendant to Mr Gary Roe, managing director of Ekebol Pty Ltd with a copy to Mr Schuhmann at around 8:39am with the subject “RE: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO”.
Particular 3(d) – VME
On or about 30 April 2018, the defendant communicated with Ms McNamara of VME by email sent by the defendant to Ms McNamara at around 10:55am with the subject heading “RE – ACCOUNT APPLICATION”.
Particular 3(e) – VME
On or about 2 May 2018, the defendant communicated with Ms McNamara of VME by email sent by the defendant to Ms McNamara and Mr McNamara at around 7:56am with the subject heading “RE – GREG CLARK BUILDING”.
Particular 3(f) – K&J Trucks Coffs Harbour
On or about 4 May 2018, the defendant communicated with Mr Schuhmann of K&J Trucks by email sent by the defendant to Mr Gary Roe, and Mr Schuhmann at around 12:29pm with the subject “Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO”.
Particular 3(g) – K&J Trucks Coffs Harbour
On or about 7 May 2018, the defendant communicated with Mr Schuhmann of K&J Trucks by email sent by the defendant to Mr Gary Roe with a copy to Mr Schuhmann at around 7:52am with the subject “Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO”.
Particular 3(h) – VME
On or about 16 May 2018, the defendant communicated with Mr McNamara of VME by email sent by the defendant to Mr McNamara at around 8:02am with the subject heading “RE – TRUCK BUILD SPEC – GREG CLARK BUILDING”.
Particular 3(i) – VME
On or about 18 May 2018, the defendant communicated with Ms McNamara of VME by email sent by the defendant to Ms McNamara at around 9:09am with the subject heading “RE – GREG CLARK BUILDING”.
Particular 3(j) – VME
On or about 31 May 2018, the defendant communicated with Mr McNamara of VME by email sent by the defendant to Mr McNamara at around 6:48am with the subject heading “RE –GREG CLARK INSTALL”.
Particular 3(k) – VME
On or about 12 and 15 June 2018, the defendant communicated with Ms Fletcher of VME by emails between the defendant and Ms Fletcher at around 11:54am on 12 June 2018 and 3:09pm on 15 June 2018 with the subject heading “Rose-Anne crane quotation”.
Particular 3(l) – VME
In or around June 2018, the defendant met with and spoke to Ms McNamara of VME at the premises of VME in South Lismore, New South Wales. The defendant said to Ms McNamara words to the effect “I have to be careful, I have made an agreement with Bob”, which Ms McNamara took to mean that he had to be careful speaking with her and that “Bob” was a reference to Bob Davis of the plaintiff. When Ms McNamara asked how long this agreement was for, the defendant replied with words to the effect “I still have two weeks”. Ms McNamara understood this to mean that the defendant could speak with her again in two weeks’ time.
Reasonable grounds to suspect
Under either subrule 303(4) or, its alternative, subrule 303(7), the Court must be satisfied that there are “reasonable grounds to suspect” the accused of the alleged contempt. I accept the plaintiff’s submission that this requires more than a “wondering”, but “less than actual persuasion”.[15] It is not necessary for the Court at this stage to decide any more beyond whether there is sufficient evidence which, if accepted, would prove the contempt.
[15] Mane Market Pty Ltd & Ors v Temple [1998] SASC S6986 at [6].
The Undertaking targets communications, unqualified as to content, within identified timeframes and with persons who fall within prescribed relationships with other protagonists.
The defendant has raised a number of contentions challenging the plaintiff’s construction of the Undertaking. He has also raised a number of arguments by reference to the plaintiff’s affidavit evidence and the defendant’s affidavit evidence directed at establishing that when all the evidence is considered, he has not breached the Undertaking in the manner alleged. According to the defendant the evidence, properly considered, serves to characterise the nature of the relationships between the plaintiff and the various protagonists referred to in the particulars of complaint on the one hand and the nature of the pre-existing and current relationships between the defendant and these protagonists on the other, quite differently from their character as insisted upon by the plaintiff. The true nature of these various relationships is such that at no time has the defendant failed to comply with the Undertaking properly construed.
None of the affidavit evidence has been tested in cross-examination or otherwise. It may transpire, once the proper construction of the Undertaking and final findings of fact have been arrived at, following a trial on all issues, that the plaintiff would fail to establish to the criminal standard some or all of the particulars of complaint. However, the task before me is to decide whether the evidence demonstrates reasonable grounds to suspect the defendant of the alleged contempt. In order to so do, I must be satisfied that there is sufficient evidence which if accepted would prove the contempt. I am entitled to draw such inferences which are reasonably open on the evidence as are most favourable to the plaintiff. Having undertaken this process with respect to the, as yet untested, evidence relied on by the plaintiff with respect to each particular of complaint, I am satisfied that there are reasonable grounds to suspect the accused of each of the alleged particulars of contempt.
I will allow the plaintiff’s application pursuant to rule 303 for the defendant to be charged with contempt. In the past, the process to be followed has been that as provided for by subrules 303(4) and (5) and rule 305, in accordance with which the Registrar of the Supreme Court would have carriage of the action but subject to an indemnity from the plaintiff for costs incurred. This procedure is still available. However, since 2011 the alternative procedure provided for by subrule 303(7) has been available. I have received no submission from either party to the effect that either form of procedure should be preferred in this case.
I take the view that the matter should proceed in accordance with the alternative subrule 303(7) procedure. There is no good reason why the resources of the Registrar and this Court should be burdened with these proceedings and notwithstanding the indemnity as to costs. In addition, and meaning no disrespect, it ought not be assumed that the plaintiff will continue, throughout the proceedings, to have the capacity to meet the indemnity.
Conclusion
Subject to hearing further from the parties as to form, I propose to make the following orders which (save for proposed order 6) are in the form of minutes of order that were provided by the plaintiff at the conclusion of the hearing.
THE COURT ORDERS that:
1.Pursuant to rule 303(7) of the Supreme Court Civil Rules, 2006 the plaintiff has permission to issue a summons to the defendant in the form annexed hereto and marked A (Summons) requiring the defendant to appear before the Court at a time nominated by the Registrar to answer the charge of contempt described in the Summons.
2.The plaintiff is permitted to issue and serve the Summons within 28 days of the date of the making of these Orders.
3.The plaintiff is to have the carriage of the prosecution of the charge described in the Summons.
4.The plaintiff is to prosecute the charge described in the Summons at its own expense and is to satisfy any costs orders made in favour of the defendant.
5.Costs reserved.
6.In the event that proceedings for contempt are commenced in accordance with these orders, the matter is to be remitted to, for management by, a Master of the Court.
Annexure A to the Minutes of Order
Rules 302, 303 of the Civil Rules 2006; Rule 130(7)(a) of the Criminal Rules 2014
Form 55  Summons for contempt
SUMMONS FOR CONTEMPT
TO: Craig Donnelly of 7 Park Avenue, Bray Park, New South Wales
Action required
You are required to attend before the Supreme Court on the hearing of this summons, which is issued by the Registrar of the Court, to answer a charge of contempt of Court in that you did breach:
1.paragraph 3(a) of the undertaking given to the Court on 13 April 2018 (Undertaking) during the period 10 November 2017 to 12 April 2018 by communicating with, or in the alternative, accepting approaches from Customers or Contractors (as defined in the undertaking) with whom you had a business relationship through your employment with the Plaintiff that was not a pre-existing Customer or Contractor of Hiab with whom Hiab had dealings in the 12 months preceding 10 November 2017 in that you:
a.     in or around January or February 2018 had communications with Mr Nathan Cox (Mr Cox), owner of CraneServe, a Contractor of the Plaintiff, in the nature of a telephone call placed by the Defendant to Mr Cox regarding the installation of Hiab cranes;
2.paragraph 3(b) of the Undertaking during the period 10 November 2017 to 12 April 2018 by communicating with or in the alternative, accepting approaches from individuals at Customers or Contractors with whom you had a business relationship through your employment with the Plaintiff in that you:
a.     on or around 10 January 2018 had communications with Mr David Robertson (Mr Robertson), Fleet Coordinator at Coffs Harbour City Council, a Customer of the Plaintiff, in the nature of a face to face discussion between Mr Robertson and the Defendant;
b.    on or around 18 January 2018 had communications with, and/or accepted the approach from, Mr Kevin Schuhmann (Mr Schuhmann) owner of K&J Trucks Coffs Harbour, a Customer of the Plaintiff, in the nature of a conversation and emails sent between the Defendant and Mr Schuhmann at around 9:58am and 12:07pm with the subject "Re: Hiab .99B3DUO 2016";
c.     on or around 18 January 2018 had communications with Mr Kevin Schuhmann in the nature of a conversation and an email sent by the Defendant to Mr Schuhmann at around 3:08pm with the subject "RE – COFFS CITY COUNCIL TENDER";
d.    in or around January or February 2018 had communications with Mr Robertson in the nature of an email sent to Mr Robertson by the Defendant advising of the Defendant's new contact details;
e.     in or around January or February 2018 had communications with Mr Cox in the nature of a telephone call placed by the Defendant to Mr Cox regarding the installation of Hiab cranes;
f.     on or around 27 February 2018 communicated with Mr Michael McNamara (Mr McNamara), part owner, director and Foreman at Vince McNamara Engineering and Sales (VME), in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 2:17pm with the subject heading "re – Crane pricing – for Michael";
g.     in or around March 2018 had communications with Ms Rose-Anne Fletcher (Ms Fletcher), Administration Assistant for VME, in the nature of a face to face discussion between Ms Fletcher and the Defendant at the premises of VME at 12 Snow Street, South Lismore, New South Wales;
h.    on or around 6 March 2018 communicated with Mr Robertson in the nature of a telephone conference between Mr Robertson, the Defendant and a representative of K& J Trucks Coffs Harbour;
i.     on or around 6 March 2018 communicated with Mr McNamara in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 8:50am with the subject heading "RE – DEMO TRUCK – K & J";
j.     on or around 22 March 2018 communicated with Mr McNamara in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 7:56am with the subject heading "RE – NATIONAL PARK CALS";
k.    on or around 27 March 2018 communicated with Mr McNamara in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 1:02pm with the subject heading "Fwd: Rous Water Calculation C1982_O1A";
l.     on or around 27 and 28 March 2018 had communications with Mr Schuhmann in the nature of emails sent between the Defendant, Mr Gary Roe (Mr Roe), Managing Director of Ekebol Pty Ltd and Mr Schuhmann at around 1:30pm and 5:26pm on 27 March 2018 and 9:25am on 28 March 2018 with the subject "Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO" or "Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO";
m.     in or around March to June 2018 had communications with Mr McNamara in the nature of a face to face discussion with Mr McNamara at the premises of VME at 12 Snow Street, South Lismore, New South Wales;
3.paragraph 3(b) of the Undertaking during the period 13 April 2018 to 30 June 2018 by communicating with or in the alternative, accepting approaches from individuals at Customers or Contractors with whom you had a business relationship through your employment with the Plaintiff in that you:
a.     (in the alternative to 0 above) in or around March to June 2018 had communications with Mr McNamara in the nature of a face to face meeting with Mr McNamara at the premises of VME at 12 Snow Street, South Lismore, New South Wales;
b.    in or around late April 2018 had communications with Ms Louise McNamara (Ms McNamara) part-owner and Administration Manager of VME, in the nature of a face to face discussion with Ms McNamara at the premises of VME at 12 Snow Street, South Lismore, New South Wales;
c.     on or around 30 April 2018 had communications with Mr Schuhmann in the nature of an email sent by the Defendant to Mr Roe, with a copy to Mr Schuhmann at around 8:39am with the subject "Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO";
d.    on or around 30 April 2018 communicated with Ms McNamara in the nature of an email sent by the Defendant to Ms McNamara via the email address [email protected] at around 10:55am with the subject heading "RE – ACCOUNT APPLICATION";
e.     on or around 2 May 2018 communicated with Ms McNamara and Mr McNamara in the nature of an email sent by the Defendant to Ms McNamara and Mr McNamara via the email address [email protected] at around 7:56am with the subject heading "RE – GREG CLARK BUILDING";
f.     on or around 4 May 2018 had communications with Mr Schuhmann in the nature of an email sent by the Defendant to Mr Roe and Mr Schuhmann at around 12:29pm with the subject "Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO";
g.     on or around 7 May 2018 had communications with Mr Schuhmann in the nature of an email sent by the Defendant to Mr Roe with a copy to Mr Schuhmann at around 7:52am with the subject "Re: Coffs Harbour Council Scania P360LB8X4MNB Tender LGP 912 QO";
h.    on or around 16 May 2018 communicated with Mr McNamara, in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 8:02am with the subject heading "RE – TRUCK BUILD SPEC – GREG CLARK BUILDING";
i.     on or around 18 May 2018 communicated with Ms McNamara in the nature of an email sent by the Defendant to Ms McNamara via the email address [email protected] at around 9:09am with the subject heading "RE – GREG CLARK BUILDING";
j.     on or around 31 May 2018 communicated with Mr McNamara, in the nature of an email sent by the Defendant to Mr McNamara via the email address [email protected] at around 6:48am with the subject heading "RE – GREG CLARK INSTALL";
k.    on or around 12 and 15 June 2018 had communications with Ms Fletcher in the nature of an emails sent between the Defendant and Ms Fletcher via the email address [email protected] at around 11:54am on 12 June 2018 and 3:09pm on 15 June 2018 with the subject heading "Rose-Anne crane quotation"; and
l.     in or around June 2018 met with and spoke to Ms McNamara at the premises of VME at 12 Snow Street, South Lismore, New South Wales.
The application will be heard before…………………………… in the Supreme Court of South Australia, 1 Gouger Street, Adelaide on......................at ……….. or so soon afterwards as the business of the Court allows.
The courtroom in which the application will be heard will be published:
Ÿ   on the Courts Administration Authority website the day before; and
Ÿ   on the notice board at the Courts Building.
Endorsements
This summons is issued pursuant to rule 303(7) of the Supreme Court Civil Rules 2006.
This summons is issued at the instigation of the plaintiff, Maxilift Australia Pty Ltd whose address for service is Thomson Geer, Level 7, 19 Gouger Street Adelaide SA 5000.
Date:

Signed by (name and title of releasing officer)
For the Registrar

Note
If you fail to attend at the above time and place, orders may be made against you in your absence and you may be punished for contempt of Court.