NHB Enterprises Pty Ltd v Corry (No 7)

[2021] NSWSC 741

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

NHB Enterprises Pty Ltd v Corry (No 7) [2021] NSWSC 741

Hearing dates:

20-24 July, 26-27 August 2020,
7-8 September 2020 (further written submissions)

Date of orders:

24 June 2021

Decision date:

24 June 2021

Jurisdiction:

Equity

Before:

Bell P

Decision:

(1)      Declare that the First Respondent was in contempt of this Court by engaging in the conduct in the circumstances described in each of Charges 1, 2 and 4 (being paras 20, 21 and 23) of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

(2)      Dismiss Charge 3 against the First Respondent, being para 22 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

(3)      Declare that the Second Respondent was in contempt of this Court by engaging in the conduct in the circumstances in the first alternative described in para 24 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

(4)      Dismiss the charge against the Third Respondent, being para 25 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

(5)      Dismiss the Notice of Motion filed by the First Respondent on 17 July 2020 with costs.

(6)      Direct the parties to file any submissions on the question of costs of no more than 4 pages by 2 July 2021, and any reply of no more than 2 pages by 16 July 2021.

(7)      Fix a directions hearing in relation to the remaining phase of the hearing at 9.30am on 22 July 2021, with any proposed directions as to the penalty hearing to be filed with the Associate to Bell P and served by 9.30am on 20 July 2021.

Catchwords:

CONTEMPT – alleged failure to comply with previous court orders – alleged breach of prohibited contact order – alleged deliberate frustration of execution of search orders – whether settlement with one party of claim underpinning contempt charge against him precluded Applicants from pursuing contempt charge.

Legislation Cited:

Civil Procedure Act 2005 (NSW) s 91

Corporations Act 2001 (Cth)

Evidence Act 1995 (NSW) ss 60(3), 140, Pt 55 rr 6-7

Supreme Court Act 1970 (NSW) s 61(2)

Supreme Court Rules 1970 (NSW) Pt 40 r 8

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Abram v National Australia Bank Ltd [1997] NSWCA 7

Alexander v Crawford [2003] NSWSC 426

Anderson v Hassett [2007] NSWSC 1310

Australasian Meat Industry Employees' Union v Mudginberri Station Proprietary Limited (1986) 161 CLR 98; [1986] HCA 46

Australian Consolidated Press Limited v Morgan (1965) 112 CLR 483; [1965] HCA 21

Australian Securities and Investments Commission v Sigalla (No 4) (2011) 80 NSWLR 113; [2011] NSWSC 62

Baker v Paul [2013] NSWCA 426

Barkley v Barkley-Brown [2010] NSWSC 746

Bellerive Homes Pty Ltd v FW Projects Pty Ltd [2019] NSWSC 193

Blair v Curran (1939) 62 CLR 464; [1939] HCA 23

Canadian Transport (UK) Ltd v Alsbury (1952) 7 WWR (NS) 49; [1953] 1 DLR 385

CCOM Pty Ltd v Jiejing Pty Ltd (1992) 36 FCR 524

Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; [1988] HCA 21

Chamberlain v The Queen (No 2) (1984) 153 CLR 521; [1984] HCA 7

Cohen v Double Bay Bowling Club [2019] NSWSC 1625

Commonwealth Bank of Australia v Salvato (No 4) [2013] NSWSC 321

Concrete Constructions Pty Ltd v Plumbers and Gasfitters Employees’ Union (No 2) (1987) 15 FCR 64

Construction, Forestry, Mining & Energy Union v BHP Steel (AIS) Pty Ltd [2001] FCA 1758

Construction, Forestry, Mining and Energy Union v Boral Resources (Vic) Pty Ltd (2015) 256 CLR 375; [2015] HCA 21

Construction, Forestry, Mining and Energy Union v Grocon Constructors (Victoria) Pty Ltd (2014) 47 VR 527; [2014] VSCA 261

Coward v Stapleton (1953) 90 CLR 573; [1953] HCA 48

Dowling v Prothonotary of the Supreme Court of New South Wales (2018) 99 NSWLR 229; [2018] NSWCA 340

Ekes v Commonwealth Bank of Australia (2014) 313 ALR 665; [2014] NSWCA 336

Eshow v Zaia [2020] NSWCA 10

Fortune Holding Group Pty Ltd v Zhang (No 2) [2017] VSC 738

Furlong v Wise & Young [2019] NSWSC 1718

Geneva Laboratories Limited v Prestige Premium Deals Pty Ltd [2016] FCA 1441

Grant v John Grant & Sons Proprietary Limited (1954) 91 CLR 112; [1954] HCA 23

Harmsworth v Harmsworth [1987] 1 WLR 1676

He Kaw Teh v The Queen (1985) 157 CLR 523; [1985] HCA 43

He v Sun [2021] NSWCA 95

In Re South American and Mexican Company; Ex parte Bank of England [1895] 1 Ch 37

In the matter of Jimmy’s Recipe Pty Limited [2020] NSWSC 93

Isaacs v The Ocean Accident and Guarantee Corporation Ltd (1957) 58 SR (NSW) 69

Keir v Leeman (1844) 6 QB 308

Keir v Leeman (1846) 9 QB 371

Kerridge v Simmonds (1906) 4 CLR 253; [1906] HCA 66

Kirkpatrick v Kotis (2004) 62 NSWLR 567; [2004] NSWSC 1265

Knowles v Roberts (1888) 38 Ch D 263

Kostov v YPOL Pty Ltd (2018) 98 NSWLR 1002; [2018] NSWCA 306

Land Enviro Corp Pty Ltd v HTT Huntley Heritage Pty Ltd (2008) 72 NSWLR 160; [2008] NSWSC 185

Lane v The Registrar of the Supreme Court of New South Wales (Equity Division) (1981) 148 CLR 245; [1981] HCA 35

Lewis v Ogden (1984) 153 CLR 682; [1984] HCA 26

Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494; [2006] FCA 83

Mahaffy v Mahaffy (2018) 97 NSWLR 119; [2018] NSWCA 42

Markisic v Commonwealth of Australia (2007) 69 NSWLR 737; [2007] NSWCA 92

Matthews v ASIC [2009] NSWCA 155

McDonnell v Novello [2006] NSWSC 1186

Mirus Australia Pty Ltd v Gage [2017] NSWSC 1046

NCR Australia v Credit Connection [2005] NSWSC 1118

NHB Enterprises Pty Ltd v Corry [2019] NSWSC 1659

O’Connor v Hough [2016] 2 Qd R 543; [2016] QSC 4

Pang v Bydand Holdings Pty Ltd [2011] NSWCA 69

Port of Melbourne Authority v Anshun Proprietary Limited (1981) 147 CLR 589; [1981] HCA 45

Prudential Assurance Co Ltd v McBains Cooper [2000] 1 WLR 2000

Reid v Howard (1993) 31 NSWLR 298

Reliance Financial Services Pty Ltd v Allyma Express Holdings Pty Ltd (No 2) [2018] NSWSC 1776

Sigalla v TZ Limited [2011] NSWCA 334

Sun v He [2020] NSWSC 802

Tomlinson v Ramsey Food Processing Pty Limited (2015) 256 CLR 507; [2015] HCA 28

Toyota Finance Australia Limited v AJI Enterprise Group Pty Ltd [2019] NSWSC 33

Weissensteiner v The Queen (1993) 178 CLR 217; [1993] HCA 65

Witham v Holloway (1995) 183 CLR 525; [1995] HCA 3

Wyszynski v Bill [2005] NSWSC 110

Zhu v Treasurer of the State of New South Wales (2004) 218 CLR 530; [2004] HCA 56

Texts Cited:

D Foskett, Foskett on Compromise (9th ed, 2020, Sweet & Maxwell)

Category:

Principal judgment

Parties:

NHB Enterprises Pty Ltd (First Applicant)
Finn Pharmaceuticals Pty Ltd (Second Applicant)
Alexander Stephen Corry (First Respondent)
Boriana Corry (Second Respondent)
Rimon Ghaly (Third Respondent)

Representation:

Counsel:

A T S Dawson SC with T Senior (Applicants)
A S Corry (in person) (First Respondent)
A S Corry (by leave) (On behalf of Second Respondent)
E A J Hyde (Third Respondent)

Solicitors:

HWL Ebsworth (Applicants)
Hall & Wilcox (Third Respondent)

File Number(s):

2019/00054125

Publication restriction:

N/A

HEADNOTE

[This headnote is not to be read as part of the judgment]

NHB Enterprises Pty Ltd (NHB Enterprises) and Finn Pharmaceuticals Pty Ltd (together, the Applicants) brought an application seeking declarations that the First Respondent, Mr Alexander Stephen Corry (Mr Corry), the Second Respondent, Mrs Boriana Corry (Mrs Corry) and the Third Respondent, Mr Rimon Ghaly (Mr Ghaly) (together, the Respondents) were in contempt of Court, and an order that they be punished for contempt.

NHB Enterprises is a veterinary compounding chemist that imports, manufactures, prepares and/or compounds medications for use by Australian veterinary practices and animal owners. NHB Enterprises kept its formulations within a software database known as the PK Compounding Software (PK Software), and also held a separate database which contained formulations and standard operating procedures relating to its business (the Vivaldi Database).

Mr Corry was employed with NHB Enterprises from February 2008 to April 2017, and for a period of that time, was the leading pharmacist and Chief Operations Officer at the company. Mr Ghaly was employed by NHB Enterprises between May 2014 and June 2017 and, for a period of time, as the pharmacist in charge.

In January 2016, Mr Corry became a director and shareholder of Medicina Pty Ltd, which traded under the name NexGen Pharma (NexGen or Medicina), in competition with the Applicants. Mr Ghaly took up a position with NexGen in 2018, but was involved with NexGen from as early as June 2017.

On 14 June 2017, the Applicants commenced proceedings in this Court against Mr Corry, NexGen and Corry Corporation Pty Ltd (the 2017 Proceedings), alleging breaches of various statutory, contractual, fiduciary and equitable obligations, including that of confidence to NHB Enterprises. On the same day, a search order was made against Mr Corry, Medicina and Corry Corporation (the First Search Order).

The 2017 Proceedings were eventually settled at mediation, with the parties entering into a “Deed of Settlement and Release” (the First Settlement Deed) which provided for the filing of consent orders. Consent orders were subsequently made on 17 April 2018 (the April 2018 Orders) which provided, inter alia, for the Defendants to deliver up to the Plaintiffs any part of the PK Software and the Vivaldi Database, and any documents created using these databases, which were in their possession, custody or control. In May 2018, the solicitors for the Defendants confirmed by email to the solicitors for the Plaintiffs that each Defendant had no document in their possession, custody or control that would fall within the relevant orders of the April 2018 Orders.

However, following affidavit evidence given by a former employee of NexGen who deposed to having observed Mr Corry having a copy of the PK Software on his personal laptop computer after the making of the April 2018 Orders, and deposed to having a conversation with Mr Corry in which the latter communicated that he still held some formulas created by NHB Enterprises, fresh proceedings were commenced in this Court in February 2019, against Mr Corry and Medicina (the 2019 Proceedings).

On the same day, the Court made a search order (the Second Search Order), permitting a search to be carried out at the Corry residential premises and the business premises of NexGen. Order 25 contained a “Prohibited Contact Order”, which outlined that except for the sole purpose of obtaining legal advice from an Australian legal practitioner, “you must not, until 4:30pm on the return day, directly or indirectly inform any person of this proceeding or of the contents of this order, or tell any person that a proceeding has been or may be brought against you by the applicant”. Order 26 provided, inter alia, that there could be no destroying, tampering with, or cancelling of any of the “listed things” in the search order.

The Second Search Order was executed on the morning of 19 February 2019 at the Corry residence. Mrs Corry was told that she could not disclose the existence of the proceedings or the search. Subpoenaed telephone records revealed three calls from Mr Corry to Mrs Corry taking place during the period 9.37am-9.39am, and some six calls between Messrs Corry and Ghaly between 9.45am-9.57am, during the execution of the Second Search Order.

Between 9.47am-1.00pm, video surveillance revealed Mr Ghaly carrying various items, including a computer owned by Mr Corry, Mr Ghaly’s two laptops, and various documents, from NexGen’s business premises to a nearby mechanic business. Later seizure and inspection of the materials at the mechanic’s premises revealed that these were NexGen’s computers and business records.

Further, at approximately 10.03am, Mrs Corry received a call, and when she gave the phone to the Independent Solicitor forming part of the Search Party (Mr Mackenzie), it became evident that both her lawyer and Mr Corry were present on the call. When questioned by Mr Mackenzie as to how he found out about the Search Party, Mr Mackenzie deposed to Mr Corry answering “My wife told me. I’m on my way now. I’ll be there soon”.

In addition to the hard copy documents, laptops and iPhone seized during the searches, the Independent Computer Expert (Ms Balit) gained access to a Microsoft Dynamics 365 Platform (the Dynamics Account) used by the NexGen business. Mr Corry provided his username and password to the Dynamics Account to Ms Balit. However, on 21 February 2019, Ms Balit’s junior informed her that he had been unable to log on to the Dynamics Account with the password that he had previously been using. Ms Balit was provided with the new password on 22 February by Mr Corry’s solicitor following a Court order requiring this to occur, and was able to complete the download of the Dynamics Account.

A large amount of Confidential Information belonging to NHB Enterprises including the PK Software and the Vivaldi Database was found on the computers of Mr Corry. With respect to Mr Ghaly, the charges against him were confined to his possession of some six documents, three of which he accepted should have been returned pursuant to the April 2018 Orders but which he said had inadvertently been retained.

A Statement of Claim in the 2019 Proceedings was filed on 2 May 2019 seeking, amongst other relief, a declaration that the Defendants were in breach of the April 2018 Orders.

A mediation in relation to the 2019 Proceedings took place in June 2019 and the proceedings resolved as between a number of parties, including Mr Ghaly, but excluding Mr Corry. Terms of settlement were entered into between a number of the defendants, providing for consent orders to be made dismissing the claims against various defendants, including Mr Ghaly.

On 14 August 2019, the Applicants filed a Notice of Motion seeking declarations that each of Mr and Mrs Corry and Mr Ghaly was in contempt of Court in various differing respects.

The issue before the Court were whether Mr Corry, Mrs Corry and Mr Ghaly should be held in contempt of Court. With respect to Mr Corry, the four charges brought against him were as follows:

1. In wilful disobedience and contravention of the April 2018 Orders, Mr Corry retained the PK Software Database and the Vivaldi Database in his possession, custody or control; retained documents which were created using the PK Software and the Vivaldi Database in his possession, custody or control; and retained hard copies of documents comprising or containing the Listed Things and/or Confidential Information (the First Corry Charge);

2. In wilful disobedience and contravention of the April 2018 Orders, Mr Corry accessed, downloaded, transferred, interfered with, disclosed, copied, exploited and/or otherwise used the Confidential Information owned by the Applicant (the Second Corry Charge);

3. Prior to the execution of the Search Order at NexGen’s business premises, Mr Corry contacted Mr Ghaly and directed him to remove items referred to in the Search Order from the business premises of NexGen, before the execution of the Search Order at that premises (the Third Corry Charge); and

4. Mr Corry breached and frustrated the Second Search Order through the interruption of the download of the Dynamics Account (the Fourth Corry Charge).

With respect to Mrs Corry, the charge brought against her was that in wilful disobedience and contravention of the Search Order, she breached the Prohibited Contact Order and/or helped or permitted Mr Corry to breach the Prohibited Contact Order, by informing him about the Search Order.

With respect to Mr Ghaly, the charge brought against him was that in wilful disobedience and contravention of the April 2018 Order, he retained certain documents and Confidential Information.

The Court held:

With respect to Mr Corry:

1. In relation to the First Corry Charge, the Court was satisfied beyond reasonable doubt that the charge should be sustained. There was a significant body of information and documents derived from the PK Software and the Vivaldi Database located both physically and electronically on Mr Corry’s devices, which were retained in brazen disregard of both the First Settlement Deed and the April 2018 Orders: [258]-[281].

2. In relation to the Second Corry Charge, the Court held that Mr Corry continued to make use of the PK Software and the data stored on it in the ongoing business of NexGen in direct competition with NHB Enterprises: [282]-[306].

3. In relation to the Third Corry Charge, the Court held that this charge could not be sustained, as such “wilful” conduct could not be made out in circumstances where it could not be established on the evidence that Mr Corry was aware of the substance of the Prohibited Contact Order at the time of his telephone conversation with Mr Ghaly: [307]-[320].

4. In relation to the Fourth Corry Charge, the Court held that the inference was inescapable that it was Mr Corry who caused the password to be changed, with the intention of frustrating the search process being conducted by the Independent Computer Expert: [321]-[336].

With respect to Mrs Corry:

5. The Court held that it was satisfied beyond reasonable doubt that, in wilful disobedience and contravention of the Second Search Order, Mrs Corry breached the Prohibited Contact Order by informing Mr Corry about the Search Order: [343]-[363], [366].

6. However, the Court was not satisfied that Mrs Corry had helped or permitted Mr Corry to breach the Prohibited Contact Order, in circumstances where the Court was not satisfied that Mr Corry was aware of that aspect of the Second Search Order at the time of his communication to Mr Ghaly: [364]-[366].

With respect to Mr Ghaly:

7. The Court dismissed the charge against Mr Ghaly, as his retention of documents and Confidential Information in breach of the April 2018 Orders was precisely what was alleged against and the subject of the settlement with Mr Ghaly in the 2019 Proceedings. As the Settlement Terms had the effect of discharging and releasing Mr Ghaly from the underlying claims in the 2019 Proceedings, the Applicants were precluded from advancing a claim for contempt against him founded on the same allegation or claim: [380]-[416].

Blair v Curran (1939) 62 CLR 464; [1939] HCA 23; Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; [1988] HCA 21; Ekes v Commonwealth Bank of Australia (2014) 313 ALR 665; [2014] NSWCA 336; In Re South American and Mexican Company; Ex parte Bank of England [1895] 1 Ch 37; Isaacs v The Ocean Accident and Guarantee Corporation Ltd (1957) 58 SR (NSW) 69; Knowles v Roberts (1888) 38 Ch D 263; Land Enviro Corp Pty Ltd v HTT Huntley Heritage Pty Ltd (2008) 72 NSWLR 160; [2008] NSWSC 185; Prudential Assurance Co Ltd vMcBains Cooper [2000] 1 WLR 2000, considered.

8. The effecting of a settlement which precluded subsequent proceedings for contempt of Court was not contrary to public policy: [407]-[413].

Canadian Transport (UK) Ltd v Alsbury (1952) 7 WWR (NS) 49; [1953] 1 DLR 385; Geneva Laboratories Limited v Prestige Premium Deals Pty Ltd [2016] FCA 1441; Keir v Leeman (1844) 6 QB 308; Keir v Leeman (1846) 9 QB 371; Kerridge v Simmonds (1906) 4 CLR 253; [1906] HCA 66; Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494; [2006] FCA 83, considered.

9. But for the preclusive effect of the settlement by the Applicants of their dispute with Mr Ghaly in 2019, the charge against Mr Ghaly would have been made out: [433].

Judgment

Introduction

1. This is an application brought by NHB Enterprises Pty Ltd (NHB Enterprises) and Finn Pharmaceuticals Pty Ltd (Finn) (together, the Applicants), in which they seek declarations that the First Respondent, Mr Alexander Stephen Corry (Mr Corry), the Second Respondent, Mrs Boriana Corry (Mrs Corry) and the Third Respondent, Mr Rimon Ghaly (Mr Ghaly) (together, the Respondents) are in contempt of Court, and an order that the Respondents be punished for contempt.

2. This judgment relates solely to the question of whether the Respondents were in contempt. Any question of punishment must necessarily arise at a later stage if the charges are made out. The Applicants, for whom Mr Dawson SC and Mr Senior appeared, accepted that they needed to make out the charges to the criminal standard, that is to say, beyond reasonable doubt. This was notwithstanding the observations of White JA in Eshow v Zaia [2020] NSWCA 10 at [24]-[25] (Eshow) that, in civil proceedings for criminal contempt, s 140 of the Evidence Act 1995 (NSW) meant that only the civil standard of proof needed to be satisfied.

1. Mr Corry, who at one point indicated from the Bar table that he has a law degree and was admitted to the Supreme Court of New South Wales but does not hold a practising certificate, represented himself in the course of the proceedings. Mr Corry was also given leave to represent Mrs Corry who filed an Affidavit on 6 May 2020 confirming her assent to that course. Mrs Corry was present throughout the hearing.

2. Mr Ghaly was represented throughout the proceedings by Mr Hyde of counsel.

3. The alleged contempts arise out of and relate to the alleged failure by Mr Corry and Mr Ghaly to comply with orders made by this Court by consent on 17 April 2018 to deliver up software belonging to the Applicants, together with documents created using in any way the software and not to access or use any and all documents or information owned by the Applicants (April 2018 Orders). The full terms of the April 2018 Orders are set out at [44] below.

4. The charges of contempt against Mr Corry also include two charges relating to subsequent orders made by the Court in February 2019 (the Second Search Order). This order is described more fully at [57]ff below.

5. The charge of contempt against Mrs Corry is confined to an alleged breach of an aspect of the Second Search Order made in February 2019.

6. A copy of the Statement of Charge, filed pursuant to Pt 55 r 7 of the Supreme Court Rules 1970 (NSW), is an appendix to and incorporated into these reasons. The specific charges against Mr Corry are detailed in paras 20-23 of the Statement of Charge; that against Mrs Corry in para 24 of the Statement of Charge; and that against Mr Ghaly in para 25 of the Statement of Charge.

7. The factual background to the application is as follows.

Background

Bova Chemist

10. Bova Compounding Chemist (Bova Chemist) is the trading name of NHB Enterprises. Mr Nicholas Patrick Bova (Mr Bova) is the Managing Director of NHB Enterprises, and a Director of Finn, which is a company related to NHB Enterprises.

11. Bova Chemist is a veterinary compounding chemist that imports, manufactures, prepares and/or compounds medications for use by Australian veterinary practices and animal owners. Bova Chemist’s client base is mainly limited to Australian veterinarians, with a very small percentage of its revenue based on medications for human consumption.

12. Mr Bova gave evidence that Bova Chemist is Australia’s largest veterinary compounding business, servicing approximately 70-80% of the veterinarians in Australia and supplying urgent medicines for tens of thousands of animals each year. As at June 2017, Bova Chemist’s annual revenue was approximately $8.5 million. With respect to Bova Chemist’s competitors, Mr Bova gave the following oral evidence (T343.7-10):

“There is a lot of small compounding pharmacies that operate in Australia. Most of them don't do just veterinary. So I don't think there's anyone else that does just veterinary compounding in Australia, so there's no one that competes on the same level as we do, but there are a lot of small competitors.”

13. Bova Chemist was the first pharmacy in Australia to be granted an Australian Pesticides and Veterinary Medicines Authority (APVMA) Good Manufacturing Practice (GMP) licence to manufacture veterinary chemical products and, as at June 2017, had approximately 55 employees with facilities which included 57 work stations and a highly sophisticated laboratory (the Laboratory) in Caringbah, New South Wales, for the purpose of researching and developing veterinary chemical products and formulations.

14. Additionally, Bova Chemist has a warehouse in Caringbah that stocks raw materials (the Warehouse). These raw materials are compounded in the Laboratory to create medications. Mr Bova, in his Affidavit sworn 13 June 2017 (which formed part of Ex 9), deposed to the fact that he estimated that, at any given time, Bova Chemist held raw materials with a value of $450,000 in the Warehouse, and that Bova Chemist had in excess of 30,000 formulations which it could create within a matter of hours, if required by a client.

PK Software

15. Bova Chemist’s formulations are, and were as at 2017, kept within a computer software database known as the PK Compounding Software (PK Software) which also includes the instructions and methods used to create Bova Chemist’s formulations.

16. Bova Chemist obtained and has continuously held a licence for PK Software since 2009. Mr Bova gave evidence that he also obtained an additional licence for Mr Corry to use on his Surface Pro computer whilst in Bova Chemist’s employ. As explained below, Mr Corry had left Bova Chemist’s employ in April 2017.

17. Mr Bova gave evidence that many of the formulations within the PK Software are unique to Bova Chemist and have been created by (a) Bova Chemist’s employees during the course of the employment or (b) third parties engaged by Bova Chemist to develop unique medications: Affidavit of Mr Bova sworn 15 February 2019 at para 9 (First Bova Affidavit), and Affidavit of Mr Bova sworn 20 December 2019 at para 16 (Second Bova Affidavit). Mr Bova gave evidence that one of the formulations stored on the PK Software since at least 2014 was Bova Chemist’s Deslorelin Formulation: Second Bova Affidavit at para 30 (CB654).

18. Mr Bova also gave evidence that in addition to the formulations, the PK Software contained the following information confidential to Bova Chemist:

(a)   client lists;

(b)   chemical lists;

(c)   prescriptions;

(d)   prices of products; and

(e)   purchase history of clients.

19. In his oral evidence-in-chief, Mr Bova said that the PK Software held all of Bova Chemist’s information, including “every single formula we’ve ever sold, every client, every raw material – it’s the whole business” (T326.38-40) and that, to draw a report from the PK Software of all the products that Bova Chemist had sold would be a “huge IP for anyone who’s trying to set up a business in competition because it tells you exactly what the veterinarians have ordered from us over all the years” (T326.40-43).

Vivaldi

20. Vivaldi is software program that contains a database (the Vivaldi Database). The Vivaldi Database holds documents containing formulations and protocols for preparing medications and standard operating procedures, training manuals and plans in relation to the business of Bova Chemist.

21. Bova Chemist acquired Vivaldi in 2015. Mr Bova gave evidence that the database was not populated with any pre-loaded formulations when he purchased the software, and that someone needed to enter documents into the database (T333.7-15; T334.18-29). He explained that the database is a document control software in which documents can be opened, edited and saved by an employee (T350.9-20). The software records what changes were made to a document and by whom. The software does not create documents itself. It was accessed by Bova Chemist’s employees regularly, with the documents within the database being amended and updated when necessary.

22. Mr Bova’s evidence was that many of the documents within the Vivaldi Database contain a unique “SOP” number, which is an acronym for “Standard Operating Procedure”: Second Bova Affidavit at para 21; T319.50-T320.1.

23. In cross-examination by Mr Corry, Mr Bova explained the process of generating a document from the Vivaldi Database, explaining that the user types in a password to enter into the software and can search for documents or go to a particular document. The documents are listed by SOPs, policies and procedures. Selecting a document stored in the Vivaldi Database opens the document in Microsoft Word, where the document can be viewed, changed and saved (T332.18-27).

24. Examples of such operating procedures referred to and tendered in the course of the hearing included the Compounding Process Validation SOP Number: 9.130A; the Method Validation Procedure for Liquids and Solid Dose Forms SOP Number: 9.140B; and the Good Documentation Practices, SOP Number 5.010. Each operating procedure may go through a number of versions as it is modified.

Mr Corry

25. Mr Corry and Mr Bova both studied pharmacy together at Sydney University in 2002, and became very close friends. As recently as 2014, Mr Bova was a groomsman at Mr Corry’s wedding.

26. Mr Corry was initially employed by Bova Chemist in or about February 2008 as a pharmacist and research development officer. The structure of his employment changed over time, with Mr Corry subsequently providing contracting services through his company, Corry Corporation Pty Ltd (Corry Corporation), to the Second Applicant, Finn.

27. By 2012, Mr Corry had become the leading pharmacist and Chief Operations Officer at Bova Chemist. According to Mr Bova’s Affidavit of 13 June 2017, Mr Corry was provided with substantial autonomy to operate and oversee the day-to-day operations of Bova Chemist’s pharmaceutical business. Mr Bova said that he placed a great deal of trust in Mr Corry as he was in charge of the manufacturing arm of Bova Chemist. Amongst other things, Mr Corry was required to:

(a)    order inventory and equipment for Bova Chemist, including solutions and materials used to prepare prescriptions for veterinary clinics;

(b)    manage and oversee all pharmacists and employees of Bova Chemist who worked in the Laboratory. In doing so, Mr Corry was required to prepare, and oversee the preparation of all prescriptions ordered by veterinarians and clinics;

(c)    consider and develop ways to streamline and improve laboratory operations, the preparation of prescriptions, solutions and production compositions;

(d)    be responsible for making changes to the business to prepare for its GMP licence issued by APVMA; and

(e)    make all the decisions regarding the manufacturing of products and ordering of stock.

28. Mr Corry remained in the role of leading pharmacist and research development officer of Bova Chemist up until April 2017.

29. Mr Bova, who had moved to the United Kingdom in 2016 to establish operations there, gave evidence in his 13 June 2017 Affidavit that at all times between 2008 and 2017, Mr Corry had:

(a)    keys to Bova Chemist’s principal place of business, including the Laboratory and Warehouse;

(b)    access to Bova’s equipment and inventory used to prepare prescriptions for veterinarians and clinics; and

(c)    access to Bova Chemist’s confidential information.

30. Mr Corry left Bova Chemist’s employ in April 2017.

31. On 28 January 2016, he became a director and shareholder of Medicina Pty Ltd (Medicina). Medicina was incorporated on 28 January 2016 and, at all material times, maintained a business unit at Unit 135, 7 Hoyle Avenue, Castle Hill, NSW. The directors of Medicina as at June 2017 in addition to Mr Corry were Mr Nishnil Singh (Mr Singh) and Mr Dharmit Goradia (Mr Goradia). Medicina traded under the name NexGen Pharma (NexGen), in competition with the Applicants and Bova Chemist. The names “Medicina” and “NexGen” will be used interchangeably in this judgment.

32. Mr Corry’s wife, Mrs Corry, also worked in the NexGen business. She was not a party to the 2017 Proceedings, which are described at [36]ff below.

Mr Ghaly

33. Between about May 2014 and June 2017, Mr Ghaly was employed by NHB Enterprises as a pharmacist and, for a period of about 6 months in 2017, as “pharmacist in charge” (T415.17-37). Whilst employed at Bova Chemist, Mr Ghaly oversaw prescriptions and was responsible for dealings with clients located in Queensland, Western Australia and parts of New South Wales.

34. Subsequent to his leaving Bova Chemist, Mr Ghaly took up a position with NexGen in 2018 (T404.26). Although he did not receive his first pay cheque from NexGen until January 2018, it emerged under cross-examination that Mr Ghaly was involved with NexGen from as early as June 2017. He ultimately accepted in cross-examination that he supervised various activities and a number of different aspects of the business at NexGen in the course of the second half of 2017, including overseeing processes, taking calls and observing finances (T448-449).

35. Mr Ghaly also accepted that he was involved in the establishment of the NexGen New Zealand business from as early as February 2017, when he took a trip in February 2017 to New Zealand with Mr Corry, Mr Davidson (see further at [39] and [47] below) and a Mr Malouf for what was identified as a “promoters meeting”. Mr Ghaly accepted, in cross-examination, that the purpose of this meeting was to discuss, inter alia, where NexGen would set up in New Zealand, what site size was needed, and what steps would need to be taken to work out logistics to get medications from Australia to New Zealand (T440.15-T441.42).

The 2017 Proceedings

36. On 14 June 2017, the Applicants commenced proceedings in the Supreme Court of New South Wales against Mr Corry, Medicina and Corry Corporation (the 2017 Proceedings).

37. The Statement of Claim in the 2017 Proceedings which was filed on 11 January 2018 (the proceedings having originally been commenced by Summons) was lengthy and detailed. It made serious allegations of unauthorised and improper use of confidential information, breach of contract, breach of fiduciary duties and breach of statutory obligations under the Corporations Act 2001 (Cth).

38. On the same day as the 2017 Proceedings were commenced, Kunc J made a search order against Mr Corry, Medicina and Corry Corporation (the First Search Order). The application for the First Search Order was supported, inter alia, by Mr Bova’s affidavit of 13 June 2017 which set out detailed allegations and concerns about conduct by Mr Corry, in particular, in the discharge of his obligations at Bova Chemist.

39. On 13 October 2017, Mr Ghaly was joined as a Defendant to the 2017 Proceedings as were Mr Brett Davidson (Mr Davidson), B J Davidson Enterprises Pty Ltd, and Messrs Singh and Goradia, trading as the partnership known as “Kurrajong Pharmacy”.

40. Paragraphs 15-23 of the Statement of Claim in the 2017 Proceedings (in which the business conducted by NHB Enterprises was defined as the “Compounding Business”) were as follows:

“Confidential Information

15   As a result of conducting the Compounding Business, the First Plaintiff and the Second Plaintiff have created and are the owners of confidential information.

16    The information that is confidential to the Compounding Business includes the following:

a.   price lists (Price Lists);

b.   client lists (Client Lists);

c.   formulations (Formulations);

d.   lists of top selling products;

e.   historical list of client purchases;

f     database of prices for which the Compounding Business    purchases products from suppliers;

g.   information contained in the PK Compounding Software (PK Software); and

h.   information contained in the Vivaldi Software Database (Vivaldi Database) (collectively, referred to as Confidential Information).

17   The First Plaintiff has a licence for the PK Software and has held that licence since at least 2009.

Particulars

The First Plaintiff’s account number for the PK Software is 500739

18   The PK Software contained the following information confidential to the Compounding Business:

a.   Client Lists;

b.   chemical lists;

c.   Formulations;

d.   prescriptions;

e.   medications of the Compounding Business;

f.    chemicals used in the Compounding Business;

g.   prices of the Compounding Business’ products;

h    purchase history of clients of the Compounding Business; and

i.    Formulation worksheets that are a manufacturing record created by the Compounding Business created when compounding prescription medicines and the Formulation worksheets contain the recipe for these products.

19   Each of the formulas within the PK Software is allocated a formula ID, which is unique to the First Plaintiff.

20   The formulas within the PK Software are trade secrets of the Compounding Business.

Particulars

The Formulation worksheets in the PK Software contain a note as follows:

‘This formula is a trade secret of BOVA CHEMIST.’

21   The First Defendant entered many of the Formulations in the PK Software.

Particulars

On the Formulation worksheet, the First Defendant inserted his name above the notation that the formula was a trade secret.

22   Accordingly, the First Defendant knew and was aware that the Plaintiffs considered the Formulations as trade secrets of the Compounding Business.

23   The Vivaldi Database houses documents that contain Confidential Information including:

a.   Formulations; and

b.   protocols for preparing medications; and

c.   procedures and protocols for carrying on the Compounding Business.”

41. In essence, the Statement of Claim alleged that Mr Corry, and Corry Corporation through him, breached various statutory, contractual, fiduciary and equitable obligations, including that of confidence to NHB Enterprises.

42. On 6 February 2018, the 2017 Proceedings were settled at mediation, the terms of which were set out in a “Terms of Settlement” document prepared and signed at the mediation (the 2017 Terms of Settlement).

43. On or about 12 April 2018, the parties to the 2017 Proceedings entered into a “Deed of Settlement and Release” (First Settlement Deed) which provided, in cl 3.1, for the filing of consent orders. The First Settlement Deed also provided for the payment by the defendants of a settlement amount of $840,000 to be paid as follows:

“•  the sum of $700,000.00 to be paid by [Medicina] and [Messrs Singh and Goradia], for which payment they are jointly and severally liable;

•   the sum of $100,000.00 by [Mr Corry] and [Corry Corporations], for which payment they are jointly and severally liable;

•   the sum of $20,000.00 by [Mr Davidson] and [B J Davidson Enterprises Pty Ltd], for which payment they are jointly and severally liable; and

•   the sum of $20,000.00 by [Mr Ghaly].”

44. On 17 April 2018, the following orders (the April 2018 Orders) were made by Ward CJ in Eq, with the consent of Mr Corry and Mr Ghaly and the other parties to the 2017 Proceedings, in accordance with the 2017 Terms of Settlement and the First Settlement Deed:

“1.   The Defendants are to deliver up to the Plaintiffs, within 7 days, any part of the PK Software and the Vivaldi Database (as those terms are defined in the Statement of Claim filed in the Proceedings) in their possession, custody or control.

2.   The Defendants are to deliver up to the Plaintiffs, within 7 days, any document in their possession, custody or control which was created using in any way the PK Software and the Vivaldi Database.

3.   The Defendants be restrained for a period of 4 years from the date of these orders, from accessing, downloading, transferring, interfering with, disclosing, copying, using, or exploiting any and all documents or information owned by the Plaintiffs or either of them, including:

a.   price lists,

b.   client lists,

c.   formulation lists,

d.   top selling product lists;

e.   historical list of client purchases;

f.    supplier purchase prices;

g.   documents created using the Plaintiffs’ PK Software; and

h.   documents created using the Plaintiffs’ Vivaldi database.

4.   The proceedings otherwise be dismissed.

5.   No order as to costs”.

45. On or about 7 May 2018, the solicitors for the Applicants, HWL Ebsworth (HWL) wrote to the then solicitors for Mr Corry and Mr Ghaly in the 2017 Proceedings (Coleman Greig) noting, in substance, that they had not received any documents in accordance with orders 1 and 2 of the April 2018 Orders, as extracted at [44] above, and seeking confirmation by 8 May 2018 that the Defendants in those proceedings (including Messrs Corry and Ghaly) did not have any documents in their possession, custody or control that would fall within orders 1 and 2 of the April 2018 Orders.

46. On or about 11 May 2018, Coleman Greig sent an email to HWL in which they stated, in substance, that they were instructed by each of the Defendants in the 2017 Proceedings that they each had no documents in their possession, custody or control that would fall within orders 1 and 2 of the April 2018 Orders.

Mr Davidson

47. As explained at [39] above, one of the Defendants joined to the 2017 Proceedings was Mr Davidson. Like Mr Corry, Mr Davidson had also been employed by the Applicants, and was employed by them between 2007 and 2015. Mr Davidson was not a pharmacist, but was employed as the National Sales and Marketing Manager. Mr Davidson left the Applicants’ employ in 2015 and, after a brief hiatus working in real estate, was contacted by Mr Corry and commenced working with NexGen in November 2016 as the Director of Sales and Marketing. In Affidavit evidence that was not challenged in cross-examination, Mr Davidson referred to a conversation he had with Mr Corry in November 2016, as follows:

“Corry:   I'm leaving Bova Compounding and am in the final stages of building my own compounding business – NexGen Pharma, with Nishnil Singh, Dharmit Goradia and Rimon Ghaly. Do you want to get back into the industry and work for us[?]

Me:      That sounds great.”

48. As also noted above, Mr Davidson, as a Defendant in the 2017 Proceedings, became a party to the First Settlement Deed. He left the employment of NexGen in August 2018.

49. Mr Davidson renewed contact with Mr Bova in late 2018 through a mutual acquaintance. It was either on that or a subsequent occasion that Mr Davidson told Mr Bova of certain matters he had observed and certain things that Mr Corry had said to him whilst in the employ of NexGen.

50. In an Affidavit sworn on 15 February 2019, Mr Davidson deposed to the fact that he:

“18.    …continued working for NexGen Pharma following the settlement of the 2017 Proceedings and the April 2018 Orders being entered, until August 2018.

19.    Between November 2016 and August 2018 (that is, during the time that I was employed by NexGen Pharma) I observed that Corry used and carried out work on a Microsoft Surface Pro laptop (the Surface Pro).

20.    Shortly after commencing work at NexGen Pharma I observed that Corry had the PK Compounding Software installed on the Surface Pro as I had seen Corry use this software at the NexGen Pharma office and recognised it from what I had observed during my employment at Bova Compounding. I became aware from Corry showing me the information on the Surface Pro, at some stage during my employment at NexGen Pharma, that the PK Compounding Software on the Surface Pro was a copy of the Bova Compounding PK Software.

21.    On at least one occasion before the April 2018 Orders, Corry identified and showed me the copy of Bova Compounding PK Software on the Surface Pro and said to me, in what I considered to be a boastful manner, ‘ha ha – look at this’.

22.    After the April 2018 Orders, I observed that Corry did not bring the Surface Pro to work, save for one or two occasions where I observed Corry charging the Surface Pro under a desk.

23.    In or about April or May 2018 (after the April 2018 Orders had been entered) Corry said to me words to the following effect:

‘The Surface Pro is at home and still has all the Bova formulations on it. If they want to get it, they can come and find it’.

24.    I understood Corry’s reference to ‘they’ to be a reference to Bova Compounding”. (emphasis in original).

With respect to para 20 of his Affidavit, Mr Davidson confirmed during his oral evidence that he observed the PK Software “a couple of times” in the NexGen office (T187.25-26), which would have occurred approximately in the first few months of Mr Davidson commencing work at NexGen (T187.31-33).

51. Mr Davidson’s Affidavit also contained evidence about a medication described as the Deslorelin/hCG combo (Des/hCG), which was administered to horses prior to the breeding season. Des/hCG had been developed by Bova Chemist, and Mr Davidson’s evidence was that Bova Chemist was the only entity in Australia that sold that medication (T190.38-40).

52. Mr Davidson deposed to the following conversation with Mr Corry in about June 2018:

“Me:       Alex are we going to be selling Des/hCG this year?

Corry:    I’m not too sure if we will.

Me:       We are going to have to sell it if we want to keep up with Bova Compounding.

Corry:   Ok, let me look into it, I might have a formula somewhere… what can Bova do about it anyway… Bova would have to try and prove it’s their formula if there were any issues.”

53. Mr Davidson said that Des/hCG was available for purchase by NexGen’s clients by August 2018. That was borne out by a copy of an email he sent on behalf of NexGen on 15 August 2018 to a Ms Jane Anderson, which relevantly stated “Just wanted to flick you a quick email to let you [know] that we are doing the Des/hCG combo this year. We are doing 30mL for $145 +gst.”

54. Mr Davidson gave the following Affidavit evidence:

“31.    In my experience, when a new formula is created by a compounding chemist for use on animals, the process involves [the] following steps:

(a)   The product is created by the pharmacists within the business;

(b)   I, as the sales and marketing manager, would contact veterinarian clients, to ask whether they would be willing to test the new formulation on a patient. (given a new product was being released to market and there were no studies to evidence the product had been used and was safe from side effects or harm to the animal);

(c)   The clients would administer the new formulation to the patient;

(d)   The clients contact me with the results of any adverse reactions to the new formula or any issues with the patient receiving the formulation – such as a paste being too dry or too oily; and

(e)   Assuming that the feedback from the clients is positive, the new treatment can be ‘rolled out’ to other clients.

32.    In my experience, in the case of an injectable product, such as Deslorelin, it usually requires several months of testing by veterinarian clients to ensure the product is safe and suitable for use. With Deslorelin specifically, in my experience, a veterinarian would need to ensure the horse would ovulate at different times of the day and then see if the horse would hold the pregnancy. During this time, I would be in communication with the clients that were testing the new products.

33.    In my role as the Director of Sales and Marketing of NexGen Pharma, it was my responsibility to contact clients, given I had their contact details and a relationship with the clients, to ask if they would be willing to test new formulas on their patients.

34.    At no time did I approach or receive any request to approach any clients of NexGen Pharma to ask if they could test a formula of Des/hCG, nor did I take or receive any request to take any other steps which I usually would have when a new formula is created by a compounding chemist and needs to be tested. Further, to my knowledge, none of the steps taken when a new formula is created, were undertaken in respect of the Des/h[C]G product.”

55. Mr Davidson also gave evidence about another medication, Cisapride, that was being sold by NexGen during his time there. He deposed to a number of complaints from clients and relayed the following conversation with Mr Corry:

“Me:     Blackrock Veterinary Clinic and other clients have complained that the Cisapride formula is too oily.

Corry:   I tweaked the formula but will just go back to the Bova formula.”

Mr Corry put to Mr Davidson in cross-examination that he (Mr Davidson) “quite clearly” recalled the words of the conversation. Mr Davidson confirmed this, saying “I do, the customer was quite upset” (T198.11-12).

The 2019 Proceedings

56. Relying, amongst other evidence, on Mr Davidson’s Affidavit of 15 February 2019, the Applicants commenced fresh proceedings in the Supreme Court of New South Wales against Mr Corry and Medicina on 18 February 2019 (the 2019 Proceedings). A third defendant, AAA Mechanical & LPG Services Pty Ltd (AAA), was briefly joined as Third Defendant in the circumstances described more fully below.

57. On the same day that the 2019 Proceedings were commenced, the Court also made the Second Search Order, referred to at [6] above, on an ex parte basis, permitting a search to be carried out at the residential premises of Mr Corry and the business premises of Medicina, including any vehicles under their control on or about those premises, in relation to the following “Listed Things” as contained within Schedule A of the Second Search Order:

“1.   The Microsoft Surface Pro, serial number 068340750253, or any other computer or electronic device containing any of the documents or things set out at paragraphs 2 to 9 below.

2.   any of the plaintiffs’:

a.   price lists,

b.   client lists,

c.   formulations,

d.   top selling product lists;

e.   historical list of client purchases; and

f.   supplier purchase prices;

3.   The plaintiff’s PK Compounding Software (account number 500739), or any copy of that software.

4.   The plaintiff’s Vivaldi database, or any copy of that database.

5.   Documents created using the plaintiffs’:

a.   PK Compounding Software; and

b.   Vivaldi database.

6.   Business records of the plaintiffs.

7.   Accounting records of the plaintiffs;

8.   Medicina Pty Ltd’s Microsoft Dynamics 365 software.

9.   Any documents held by Medicina Pty Ltd that record:

a.   the formulations used by it to compound or create medications; and

b.   its knowledge or use of that information referred to in paragraphs 2, 3, 4, 6 and 7 above”.

58. The Second Search Order included on its front page under the bold and capitalised heading “PENAL NOTICE” the following statement, also in bold and capitals:

“IF YOU (BEING THE PERSON BOUND BY THIS ORDER):

(A)   REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THE ORDER FOR THE DOING THE ACT; OR

(B)   DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU TO ABSTAIN FROM DOING,

YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT.

ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED”.

The Penal Notice was addressed to “Alexander Stephen Corry and Medicina Pty Ltd”.

59. Order 6 of the Second Search Order provided that:

“This order must be complied with by you by:

(a)   yourself; or

(b)   any director, officer, partner, employee or agent of yourself; or

(c)   any other person having responsible control of the premises.”

The reference to “premises” is self-evidently a reference to the premises as specified under Schedule A of the Second Search Order. These included Mr Corry’s residential premises (the Corry residence).

60. Order 25 of the Second Search Order provided that:

“Except for the sole purpose of obtaining legal advice from an Australian legal practitioner, you must not, until 4:30pm on the return day, directly or indirectly inform any person of this proceeding or of the contents of this order, or tell any person that a proceeding has been or may be brought against you by the applicant”.

This Order was defined in the Statement of Charge as the “Prohibited Contact Order”.

61. Order 26 of the Second Search Order provided:

“Until 4:30pm on the return day you must not destroy, tamper with, cancel or part with possession, power, custody or control of the listed things otherwise than in accordance with the terms of this order or further order of the Court”.

62. Schedule A of the Second Search Order specified a “Search Party” comprising: the Independent Solicitor (Mr Jeremy Mackenzie) of Mills Oakley and his colleague, Ms Stephanie Young (Ms Young); the Applicants’ solicitor, Mr Neil Wallman (Mr Wallman) and his colleague, Ms Vanessa Sarpa; and an Independent Computer Expert, Ms Leanne Balit (Ms Balit) from Klein & Co, together with her colleague, Mr Gary Hunter. Mr Mackenzie and Ms Balit had respectively discharged the role of Independent Solicitor and Independent Computer Expert for the purposes of the First Search Order which had been made and executed as part of the 2017 Proceedings.

63. On 19 February 2019, the day the Second Search Order was executed, and following a further ex parte application to the Court, the Second Search Order was amended and extended to include a third set of premises, these being the premises of AAA. The Second Search Order was also amended to extend the time period in which the search could occur.

64. AAA’s premises comprised another industrial unit at the same street address as NexGen’s business premises, being 7 Hoyle Avenue, Castle Hill. AAA was located at Unit 132, whilst NexGen was located at Unit 135. The premises were physically adjacent. The reasons for this second ex parte application are explained more fully at [120] below.

65. The circumstances in which the Second Search Order was executed are particularly relevant to aspects of the contempt charges against Mr Corry and the entirety of the charge against Mrs Corry.

Execution of the Second Search Order

66. The Second Search Order was executed on the morning of 19 February 2019. As is customary, both Mr Mackenzie as Independent Solicitor and Ms Balit as Independent Computer Expert provided reports to the Court on the first return date in the 2019 Proceedings, which was 21 February 2019. Both Mr Mackenzie and Ms Balit gave evidence in the contempt proceedings and were cross-examined by Mr Corry.

67. In addition to Mr Mackenzie and Ms Balit, evidence in relation to the manner in which the Second Search Order was executed and the search implemented was given by Mr Wallman, Mr Bruce Grant (Mr Grant) (a private inquiry agent and former employee of Verifact Pty Ltd) and, to a certain extent, Mr Ghaly. Contemporaneous notes taken by Mr Mackenzie and Ms Young of their attendance at the Corry’s residence were also tendered and became Ex 14 and 15.

68. Mr and Mrs Corry did not give evidence in the contempt proceedings (although an Affidavit of Mr Corry was read in support of a Notice of Motion which was heard at the beginning of the hearing of the contempt proceedings and which is referred to and dealt with more extensively below).

69. Although he was cross-examined, the account of the execution of the Second Search Order at the Corry residence given by Mr Mackenzie was largely unchallenged, and the following factual account and my findings, set out below, in relation to what occurred on 19 February 2019 derive largely from Mr Mackenzie’s report to the Court, dated 21 February 2019, supplemented by his contemporaneous notes and those of Ms Young.

70. The Search Party assembled near the Corry residence, at a nearby public park, at around 8.50am on 19 February 2019. Surveillance had been separately arranged of the Corry residence, as well as NexGen’s business premises in Castle Hill. Mr Grant was in the vicinity of those premises during the morning of 19 February 2019.

71. In his Independent Solicitor’s Report which was annexed to his Affidavit sworn 7 May 2020, Mr Mackenzie recorded that at approximately 9.04am on 19 February 2019, Ms Young and he arrived at the Corry residence. Mr Mackenzie knocked on the front door and Mrs Corry, who Mr Mackenzie had previously met during the service and execution of the First Search Order, opened the door. Mr Mackenzie introduced himself, and had the following conversation:

“Mr Mackenzie:  Is Alexander Corry home?

Mrs Corry:          No he’s left for work.

Mr Mackenzie:   Mrs Corry, do you have the responsible control of these premises?

Mrs Corry:          Yes, I guess so.

Mr Mackenzie:   Is there anyone else in the house besides you?

Mrs Corry:          Yes, my three year old daughter.”

72. Mr Mackenzie explained to Mrs Corry that he was the Independent Solicitor appointed to supervise the search of the premises authorised by the Second Search Order. Mr Mackenzie handed Mrs Corry a folder containing the Bundle for Service (being the Court papers relied upon to secure the search order), and advised her that the Second Search Order and supporting documents were contained in that folder.

73. Mr Mackenzie asked Mrs Corry if she wished him to explain the Second Search Order to her. Mrs Corry said she was on her way to work and was about to take her daughter to day care.

74. Mr Mackenzie said that he then outlined the prohibitions on the disclosure of the existence of the proceedings and the contents of the Second Search Order. Mrs Corry then asked if she was listed on the order. Mr Mackenzie confirmed that she was not, and that the order was addressed to Mr Corry and Medicina. Mr Mackenzie also stated that he explained that that was why he had asked if she had responsible control of the premises, to which Mrs Corry replied with the words “Yes, I see”.

75. Mr Mackenzie then suggested that they go inside to discuss the Second Search Order. Once inside and seated in the living area, Mr Mackenzie handed Mrs Corry his business card, and said words to the following effect:

“Mr Mackenzie:   Mrs Corry, would you like me to explain the Search Order to you?

Mrs Corry:           No thank you.”

76. After a short while, according to Mr Mackenzie’s account, Mrs Corry then raised the issue about her work, and said words to the following effect:

“I’m supposed to be doing interviews today at work. I have people coming to see me. I need to call work and tell them that I am not coming. And I need to call the people interviewing so that they don’t turn up. Can I call them?”

(Later evidence given by Mr Ghaly established that Mrs Corry also worked at NexGen).

77. Mr Mackenzie advised Mrs Corry that she could call her work and the candidates for interview, and he noted that she could not disclose the existence of the Second Search Order to anyone except an Australian Legal Practitioner.

78. At approximately 9.10am, Mrs Corry advised Mr Mackenzie that she would be calling work. Mr Mackenzie said he did not know to whom Mrs Corry spoke but heard her say words to the following effect:

“Hi, I’m not coming into work today … I’m just not coming in. I know. I’m not coming in. We will need to reschedule those interviews”.

79. Mr Dawson put to Mr Ghaly that he had spoken to Mrs Corry at about 9.10am on the morning of 19 February 2019, and that she had told him that she was not coming into the office. Mr Ghaly accepted this.

80. Mr Mackenzie then had a conversation with Mrs Corry in words to the following effect:

“Mrs Corry:         I don’t know what to do. I don’t even know who our lawyers are.

Mr Mackenzie:   On the last occasion your husband used Nick Kallipolitis (Mr Kallipolitis) from Coleman Gr[ei]g.”

81. At approximately 9.15am, Mrs Corry then called Coleman Greig looking to speak to Mr Kallipolitis. Mr Mackenzie understood that Mrs Corry could not get through to Mr Kallipolitis, but that she was provided the details of another solicitor, Mr Mario Rashid (Mr Rashid). Ms Young’s notes then record a call to “Mario” at 9.15am noting a request for the documents to be provided to him.

82. At approximately 9.20am, Mr Mackenzie called Mr Wallman (who was not, at that stage, physically with him) and requested that he arrange for his office to send the Bundle for Service to Mr Rashid at Coleman Greig.

83. At approximately 9.26am, Mr Mackenzie again offered to explain the Second Search Order to Mrs Corry, but she responded with words to the following effect: “No thanks. That’s not necessary. It’s the same as last time”. Mr Mackenzie then outlined that Mrs Corry became upset and tearful and said: “We have lost everything, our home, our cars, he will never stop until he takes everything”. The “he” in this statement was presumably a reference to Mr Bova.

84. At approximately 9.30am, Mrs Corry and Mr Mackenzie had a conversation in words to the following effect:

“Mr Mackenzie:   How many computers are in your home?

Mrs Corry:           My daughter has a laptop she uses for school. I’m not sure if she has taken it to school today. There are no other computers in the house, except for those that are in that room.”

Mr Mackenzie understood that Mrs Corry was referring to the “Study” room.

85. Mr Mackenzie’s report of his conversation with Mrs Corry continued, as follows:

“Mrs Corry:            Are they going to the going [sic] to go to Nexgen today?

Mr Mackenzie:      Yes

Mrs Corry:             Is someone at Nexgen right now?

Mr Mackenzie:      No

Mrs Corry:             So you will go there after this?

Mr Mackenzie:      Yes.”

Mr Mackenzie’s handwritten notes taken at the time of the search noted that Mrs Corry had asked “Are they going to the other premises today?” to which Mr Mackenzie said “yes”. This exchange is given a time of 9.29am. Mr Mackenzie’s account is supported by Ms Young’s notes. Ms Young’s notes also recorded that Mrs Corry asked Mr Mackenzie the grounds for the Search Order, to which he responded to read the Bova and Davidson Affidavits. Ms Young noted that Mrs Corry was reading the Affidavits at about 9.30am.

86. Mr Mackenzie’s notes contain an entry for 9.35am in which he records Mrs Corry asking him whether it was possible to cancel interviews “if you watch”, to which Mr Mackenzie replied “Yes, of course. You just can’t disclose the existence of the proceedings or the order”. Mr Mackenzie’s notes also contain an entry for 9.36am recording a call to Mrs Corry from NexGen. The substance of this call as recorded in Mr Mackenzie’s notes was “something personal has come up … can we catch up on Thursday”, this presumably being that part of the telephone conversation he overheard. Mr Mackenzie’s notes do not record to whom Mrs Corry was speaking.

87. In his report to the Court, Mr Mackenzie said that his conversation with Mrs Corry continued, in words to the following effect:

“Mrs Corry:        At what point will the searchers come in?

Mr Mackenzie:   I will allow the Search Party to come in after you have had 2 hours to talk with your lawyer, but subject to determining if you need more time.”    

He also recorded in his notes that at 9.38am, Mrs Corry asked “Would we [i.e. the Search Party] be going to NexGen after the search here?” to which Mr Mackenzie replied “Yes, that’s the current plan”.

88. According to his notes, Mr Mackenzie heard Mrs Corry call “Sally” at about 9.43am, to reschedule an interview to the following Thursday. It may be observed that there is a 5 minute gap in Mr Mackenzie’s notes between 9.38am and 9.43am in the sense that he does not record anything occurring in this time period.

89. Interposing here, the Applicants pointed in their final written submissions to three telephone calls, the details of which were derived from subpoenaed telephone records which were tendered in evidence, the details of which are set out in the following table:

Time	From	To	Duration	CB Reference
9:37:47am	Mr Corry [##]	Mrs Corry [##]	51 seconds	CB1168-1171 Item 257
9:39:07am	Mr Corry [##]	Mrs Corry [##]	8 seconds	CB1168-1171 Item 260
9:39:25am	Mr Corry [##]	Mrs Corry [##]	180 seconds (3 minutes)	CB1168-1171 Item 262

90. At approximately 9.45am, according to Mr Mackenzie’s report to the Court, Mrs Corry said that she needed to bring her daughter downstairs so that she could be supervised. Mrs Corry showed Mr Mackenzie and Ms Young that she was leaving her phone on the kitchen bench. Mrs Corry subsequently returned downstairs with her daughter. Mr Mackenzie’s report says that this occurred “shortly thereafter” but did not specify the time period Mrs Corry was upstairs. Ms Young’s notes recorded that Mrs Corry came downstairs with her daughter at 9.45am, implying that Mrs Corry had gone upstairs earlier than Mr Mackenzie’s notes recorded.

91. It is highly likely that the 180-second telephone call shown in the table set out above took place whilst Mrs Corry was upstairs with her daughter, and that Mr Mackenzie’s statement of the time that Mrs Corry went upstairs which was qualified by the word “approximately” may not have been precisely accurate. As Mr Dawson observed, “[t]he curious thing about it is that Mr Mackenzie's evidence is that Mrs Corry's mobile phone was left on the counter, so that she presumably, one infers, is giving them comfort that she's not taking the phone out of the kitchen to breach the prohibited contact order or what we've called the prohibited contact warnings which she was given repeatedly by Mr Mackenzie” (T565.38). I accept Mr Dawson’s further submission that the telephone records “fit perfectly into that gap” when Mrs Corry was upstairs, with the inference being that she managed to take Mr Corry’s call on some other device (T574). This also strongly suggests that the 9.36am telephone call to Mrs Corry referred to at [86] was probably the first of the calls referred to in the table at [89]. I also find that it was in the course of the 180-second call that Mrs Corry communicated to Mr Corry the fact of the issue of the Second Search Order, and that it extended to NexGen’s premises. There is clear evidence that Mrs Corry was the source of Mr Corry’s first knowledge of the Second Search Order (see [104]-[110] below).

92. Interpolating there, Mr Ghaly gave evidence of a phone call he received from Mr Corry on 19 February 2019 which, under cross-examination, he accepted took place at about 9.45am (T517.23). Mr Ghaly’s account of this conversation as set out in his Affidavit sworn 19 September 2019 was as follows:

“On 19 February 2019, I received a call from the First Defendant, Mr Corry, while I was at NexGen's business address at Unit 135, 7 Hoyle Avenue, Castle Hill NSW 2154 and we had a conversation to the following effect:

He said:   ‘Rimon, I just called Boriana [Mrs Corry] - but I can't get a hold of her.’

I said:      ‘Okay?’

He said:   ‘I am going home now because she should be at work or on her way. You need to get all your personal stuff and move it offsite. I don't know what the situation is – but we need to make sure that our work stuff is clearly our work stuff.’

I said:      ‘What do you mean, what things?’

He said:   ‘I don't know. Have a look around. Your computers, my computer, any of our personal things. There are some things in the corner of my desk. Just get rid of anything that looks like it belongs to NexGen and we can sort it out later.’

I said:      ‘Okay.’”

93. When under cross-examination, Mr Ghaly sought to correct this account by adding the word “doesn’t” before “looks like it belongs to” in the statement attributed to Mr Corry (T520; T533). At the time of the conversation set out at [92] above, Mr Ghaly was at NexGen’s business premises at Unit 135, 7 Hoyle Avenue, Castle Hill.

94. Telephone records recorded that Mr Corry spoke to or left messages for Mr Ghaly six times between 9.45am and 9.57am on the morning of 19 February 2019 as the following table set out by the Applicants in final submissions demonstrates:

Time	From	To	Duration	CB Reference
9:45:27am	Mr Ghaly [##]	Mr Corry [##]	32 seconds	CB1174-1177 Item 269
9:46:40am	Mr Corry [##]	Mr Ghaly [##]	12 seconds	CB1174-1177 Item 272
9:50:11am	Mr Corry [##]	Mr Ghaly [##]	54 seconds	CB1174-1177 Item 280
9:51:55am	Mr Corry [##]	Mr Ghaly [##]	3 seconds	CB1174-1177 Item 288
9:56:04am	Mr Corry [##]	Mr Ghaly [##]	74 seconds	CB1174-1177 Item 296
9:57:44am	Mr Ghaly [##]	Mr Corry [##]	20 seconds	CB1174-1177 Item 299

95. Mr Ghaly was forcefully cross-examined about his account of the conversation with Mr Corry set out at [92] above, in particular with regard to the fact that he did not tell Mr Corry that he, Mr Ghaly, had spoken to Mrs Corry just over half an hour earlier, and had been told by her that she was not coming into work. Mr Dawson also put to Mr Ghaly but he denied that, in the conversation with Mr Corry, Mr Corry had told Mr Ghaly that there was a search order being executed at his house, and that the Search Party might come to the NexGen premises (T519). I do not accept Mr Ghaly’s denial of what he was told by Mr Corry, nor do I accept that part of his account of the telephone conversation with Mr Corry in which he attributes to Mr Corry the statement that he could not get hold of his wife. Mr Corry had just had a 3 minute call with her shortly before he rang Mr Ghaly and, as shall be seen, was shortly to tell Mr Mackenzie that he found out about the search order from his wife.

96. At approximately 9.44am, Mr Grant from Verifact was conducting surveillance of NexGen’s commercial premises in Castle Hill from inside his vehicle in a nearby public carpark: T102.49-T103.3. He gave evidence, confirmed by video footage that was played in Court and tendered, that he observed a male worker in his late 30s with a shaved head and wearing a blue nurse style uniform frantically walking from unit 135 (the premises of NexGen) carrying what Mr Grant described as appearing to be “a full back pack whilst conversing on his mobile phone”. Mr Grant observed the male walk into the nearby factory unit (unit no 132) and quickly left the bag just to the left of the counter, before jogging back to unit 135.

97. Unit 132 was the premises of AAA (see [64] above). Mr Grant observed the same man walking out of unit 135 again, carrying a computer monitor and placing it at unit 132, and thereafter jogging back to unit 135. Video footage was played in Court consistent with Mr Grant’s observations. The bald headed man observed by Mr Grant was Mr Ghaly.

98. In a written report of his surveillance dated 21 February 2019, Mr Grant made the following observations in relation to his surveillance of the commercial premises in Castle Hill between 9.47am until 1.00pm:

“9:47am    The aforementioned male walked out of unit 135 carrying a large amount of what appeared to be books/documents in his hands and left them at unit number 132, before returning to unit 135.

9:51am     The aforementioned male was seen as he walked out of unit 135 and places several sheets of paper into a green [bin] and a [sic] other documents into a nearby security blue bin.

9:53am     The same male was observed as [he] carried more documents from unit 153 [sic: 135] to the 132 unit before returning to 135.

10:00am   Same male seen walking from unit 135 to unit 132 carrying a large plastic tub full of documents, which he left there and returned to 135.

10:01am   To 1.00pm the same male was seen on many occasions walking around outside unit 135 whilst conversing on his mobile phone and appeared to be on edge.

1:00pm     As instructed we ceased surveillance and depart the area.”

99. Pausing there, this detailed contemporaneous account of Mr Ghaly’s actions was inconsistent with the attempted correction to his Affidavit evidence that has been noted at [93] above, as well as his attribution to Mr Corry of the statement “You need to get all your personal stuff and move it offsite”. What was removed included the HP Pavilion computer used by Mr Corry and which had the PK Software on it, Mr Ghaly’s two laptops on which he did his work for NexGen, and various Bova documents.

100. What was undoubtedly occurring in this period, as confirmed by later seizure and inspection of the materials removed to AAA’s premises in unit 132, was the urgent removal of NexGen’s computers and business records from its business premises, at Mr Corry’s direction. Under cross-examination, Mr Ghaly gave the implausible, self-serving and (I find) false explanation that he was running between premises (as shown on the video surveillance footage) because he “just wanted to get back into work because a pharmacist needs to be on the premises at all times” (T522.12-13). In my opinion, his urgency was because of the need he understood from Mr Corry to remove material from the NexGen premises as quickly as possible, and before any search party arrived.

101. Mr Ghaly’s account also does not explain why various documents were dumped into rubbish bins outside the premises, as shown on the video surveillance. This seems to be inconsistent with his denial in his Affidavit evidence and in his answers to cross-examination by Mr Corry that he knew that another search order had been issued which extended to NexGen’s premises.

102. Returning to the evidence of Mr Mackenzie dealing with the execution of the Second Search Order at the Corry’s residential premises, at approximately 10.00am whilst in Mr Mackenzie’s presence, Mrs Corry received a telephone call from Mr Corry, and asked Mr Mackenzie if she could answer. Mr Mackenzie advised that she could, but again noted the prohibitions contained in the Second Search Order. Mr Mackenzie gave evidence that he did not hear what Mr Corry was saying, however, he did hear Mrs Corry saying words to the following effect during that call:

“Hi… I’m not coming in today… Same as always… Yep. Yep… Yes…. I’m aware of that… Ok… Ok, bye”.

103. At approximately 10.03am, Mrs Corry received a call, and told Mr Mackenzie that it was from her lawyers. She picked up the call and said “Hi Chris, how are you”. She continued on the call and asked that Mr Mackenzie speak to him directly, and handed Mr Mackenzie the phone, which she put on speaker.

104. When Mr Mackenzie received the phone, he noticed on the screen that the contact name in respect of the current caller said “Alex”. However, the person who Mr Mackenzie was speaking to identified himself as Mr Christopher Athanassios (Mr Athanassios) from Miller & Prince Lawyers. Mr Mackenzie and Mr Athanassios had a conversation in words to the following effect:

“Mr Athanassios:   When will you be commencing the search?

Mr Mackenzie:       At this point, I intend to commence the search at 11:04am, being two hours after Mrs Corry was served with the Search Order.

Mr Athanassios:    No. You can’t start then. My client is on his way back now. He needs time to get legal advice.

Mr Mackenzie:      Mrs Corry has already had time since 9am. In fact she has spoken to a solicitor at Coleman Gr[ei]g.

Mr Athanassios:    We reserve all rights. You are trespassing on the property.

Mr Mackenzie:       I’m not trespassing. I am entitled to be here as the Court appointed independent solicitor. In any event, why don’t you give me your contact details so that I can have the documents emailed to you.

[Mr Athanassios then gave Mr Mackenzie his email address]

Mr Mackenzie:      What number are you calling from?

Mr Athanassios:    My office landline number.

Mr Mackenzie:      Is there someone else on this call?

Mr Athanassios:    Yes, Alex Corry.

Mr Mackenzie:      Mr Corry are you there.

Mr Corry:               I’m here.

Mr Mackenzie:      Mr Corry, how did you find out about the Search Order?

Mr Corry:              My wife told me. I’m on my way now. I’ll be there soon.” (emphasis added).

105. In final submissions, Mr Dawson placed emphasis upon the fact that Mr Athanassios’s first question to Mr Mackenzie – “[w]hen will you be commencing the search?” – revealed that he knew about the Second Search Order at the time, and submitted that the only person who could have told him about it was Mr Corry, and that the only person who could have told Mr Corry was Mrs Corry.

106. This was supported by the evidence-in-chief of Mr Athanassios who indicated that he first became aware of the Second Search Order within the two-hour window before the search started (T55.26-29), and accepted that it was Mr Corry who talked to him about the Second Search Order on the morning of 19 February 2019 (T55.41-43).

107. Mr Mackenzie was cross-examined by Mr Corry in relation to the last statement attributed to Mr Corry in Mr Mackenzie’s account of the conversation set out at [104] above. Mr Corry asked Mr Mackenzie whether it was possible that the words that were actually said were “I called my wife. I’m on my way home now. I’ll be there soon.” (T161.41-42). Mr Mackenzie said “I don’t believe so”, and when pressed by Mr Corry as to whether or not it was possible, said:

“A.   No, because when this report was prepared I had reference to the handwritten notes of Ms Young, my handwritten notes, but my report was prepared a day, a day and a half after. I had a clear recollection of that conversation. It was a remarkable conversation to be frank with you.

Q.   So you just said you had reference to the handwritten notes of Ms Young?

A.   When I prepared this report, yes.

Q.   In which case is it true to say that--

HIS HONOUR:

He said he had reference to the handwritten notes of Ms Young and his own notes I think.”

108. The handwritten notes referred to were called for and subsequently produced whilst Mr Mackenzie was still under cross-examination. Ms Young’s handwritten notes make reference to the three-way conversation between Messrs Mackenzie, Athanassios and Corry taking place at 10.10am as follows:

“Mackenzie:   How did you become aware of the order?

Corry:             I just called my wife. And then I called Chris.”

109. The difference between Mr Mackenzie’s evidence that Mr Corry said “My wife told me” in answer to the question how he found out about the Second Search Order and Ms Young’s note “I just called my wife” was one which Mr Corry, in final submissions, attempted to place great store on. The difference between the two accounts eluded me and, for reasons explained later in this judgment, I see no difference in substance between the two accounts. What may be remarked, however, is that both accounts are consistent with Mrs Corry not having herself initiated the telephone call. This is consistent with the telephone records extracted at [89] above. Both accounts also confirm that a telephone call between Mr Corry and his wife must have taken place whilst Mrs Corry was upstairs in her home just before 9.45am, and outside of earshot of Mr Mackenzie and Ms Young.

110. Some further corroboration of the fact that Mrs Corry was the source of Mr Corry learning of the Second Search Order emerged in evidence given by Mr Athanassios when examined by Mr Dawson, to the effect that Mrs Corry had informed Mr Corry (T57.10), and that Mr Corry had said to Mr Athanassios that “[i]t wasn’t a breach of the terms of the search order because he’s [that is, Mr Corry was] an Australian legal practitioner.” (T57.15-44) Mr Athanassios accepted that he had a concern that Mr Corry had found out about the search order before being served with it (T63.34-38), and that he shared a similar concern with respect to Mr Ghaly (T64.20-22; T66.26-28). Mr Athanassios also gave evidence to the effect that he believed that Mr Ghaly informed him that Mr Corry had told Mr Ghaly about the search order (T66.4-5).

111. Returning to the chronology, Mr Mackenzie subsequently called Mr Wallman and requested that he provide an electronic copy of the Bundle for Service to Mr Athanassios. Mr Mackenzie also advised Mr Wallman that Mr Corry was aware of the Second Search Order and was returning to his residential address.

112. At approximately 10.22am, Mrs Corry called Mr Corry asking where he was. Mr Mackenzie deposed to the conversation being in words to the following effect:

“Mrs Corry:       How far aware [sic] are you?

Then turning to [Mr Mackenzie] she asked:

Mrs Corry:        Can I disclose the affidavits?

Mr Mackenzie:  You are prohibited from disclosing this Search Order to anyone except an Australian Legal Practitioner.

Mrs Corry:         [To Mr Corry] I can’t tell you anything until you get here.”

According to Mr Mackenzie’s notes, when he told Mrs Corry that she was prohibited from disclosing the Search Order to anyone except an Australian Legal Practitioner, he referred her to paras 25 and 26. This was presumably a reference to paras 25 and 26 of the Second Search Order which have been set out at [60]-[61] above.

113. At approximately 10.35am, Mr Corry entered the residential property. Mr Mackenzie provided him the Bundle for Service, which he took. Mr Corry then said words to the following effect:

“Mr Corry:         Your client’s not going to be happy.

Mr Mackenzie:  They are not my clients. I am the independent solicitor.

Mr Corry:           I’m taking this to the bathroom. Your client is not going to be so comfortable this time.”

114. Mr Corry then took the folder containing the Bundle for Service with him into the bathroom. On his return, Mr Mackenzie asked whether Mr Corry would like him to explain the Second Search Order to him. Mr Corry said he wanted to get Mr Athanassios on the phone, and asked Mrs Corry to give him her phone, so he could call the lawyer.

383. In his written submissions, Mr Hyde contended that:

“where the Plaintiffs make an agreement not to pursue contempt proceeding themselves, Mr Ghaly has a proper defence to that claim vis-a-vis the Plaintiffs and the Plaintiffs ought not to be able to resile from what they have agreed not to do. Alternatively, the Plaintiffs ought to be stayed from prosecuting the Contempt Motion against Mr Ghaly.”

In his oral submissions, this argument was further developed and somewhat refined, with emphasis being placed on the juridical effect of a release and discharge in respect of the claims of breach of the April 2018 Orders which underlay the contempt charge against Mr Corry.

387. Mr Hyde submitted that his argument would not preclude the Court, of its own motion if so minded, from charging Mr Ghaly with contempt of court on the basis of any breach of the April 2018 Orders, citing, in this respect, the decision of Perram J in Geneva Laboratories Limited v Prestige Premium Deals Pty Ltd [2016] FCA 1441 (Geneva Laboratories). Mr Hyde contended, however, that the Applicants, having released and discharged Mr Ghaly from their claims that he had breached the April 2018 Orders, could not themselves bring proceedings for contempt of court based on those same claims. That, it was submitted, was the effect of the release and discharge. In this context, it was not in doubt, in my opinion, that the contempt claim against Mr Ghaly was founded on the same underlying claims that had been made against him in the 2019 Proceedings.

388. Mr Hyde emphasised that the current proceedings were brought in the Supreme Court’s civil jurisdiction, even though criminal contempt was charged. This characterisation was consistent with the Court of Appeal’s judgment in Dowling.

389. Mr Dawson sought to counter this argument, contending that it was a repetition of the argument that had been rejected by Parker J in the earlier interlocutory judgment (albeit that it was, correctly, not submitted that Mr Ghaly was precluded by that decision from making it). Although there were elements of that argument that were repeated – for example, that based upon s 61 of the Supreme Court Act – the argument advanced before me was more refined. It was also submitted by Mr Dawson that the cross-examination of Mr Ghaly and his understanding of the mediation had some relevance to the argument.

390. Mr Dawson also emphasised the fact that the contempt application had not been made nor foreshadowed prior to the parties entering into the Second Settlement Terms, and that this indicated that it was not within the contemplation of the parties at the time they agreed upon the Second Settlement Terms that the release and discharge would extend to contempt proceedings against Mr Ghaly. He referred in this regard to Grant v John Grant & Sons Proprietary Limited (1954) 91 CLR 112; [1954] HCA 23 (John Grant).

391. In summary, the Applicants contended that cl 15 of the Second Settlement Terms could not and did not have the effect of releasing Mr Ghaly from, or preventing the Applicants from prosecuting, the contempt charge against him. They emphasised that:

a.   it was clear from the text of the Second Settlement Terms that the object of those terms was to achieve a settlement of the causes of action pleaded in the Statement of Claim;

b.   although the consent orders referred to in para 9 of the Second Settlement Terms had not been provided to or made by the Court, they reflected the fact that the settlement was confined to the causes of action pleaded in the Statement of Claim;

c.   clause 15 was not expressed in wide or general words, but expressly confined to the particular claims made by the Applicants against the Second to Fifth Defendants in the Statement of Claim in the 2019 Proceedings;

d.   the purpose of those terms was not only to settle the 2019 Proceedings as between the Applicants and the Second to Fifth Defendants, but to undo the damage caused by the Second to Fifth Defendants’ failure to comply with the settlement of the 2017 Proceedings and to protect the Applicants in the future; and

e.   the purpose of the Second Settlement Terms was not to impose restrictions on the ability of the Applicants to take steps to prosecute the present application, nor could it have been, given the fact that the topic of contempt had not been raised before the Second Settlement Terms were agreed.

Consideration

392. The effect of the settlement of the claims in the 2019 Proceedings against Mr Ghaly was, in my opinion, that the Applicants could not assert as the foundation for their contempt claim against him, his failure to comply with the April 2018 orders. This was the legal effect of the compromise, and the Applicants thereafter could not and cannot be heard to say, whatever be the true state of affairs, that Mr Ghaly had failed to comply with the April 2018 Orders.

393. In Prudential Assurance Co Ltd vMcBains Cooper [2000] 1 WLR 2000 at 2005 (Prudential Assurance), Brooke LJ, with whom Peter Gibson and Robert Walker LJJ agreed, said:

“It is elementary that parties to private litigation are at liberty to resolve their differences by a compromise, and that an unimpeached compromise represents the end of the dispute or disputes from which it arose: see Foskett, The Law and Practice of Compromise, 4th ed. (1996), p. 90, citing Plumley v Horrells (1869) 20 LT 473, per Lord Romilly MR and Knowles v Roberts (1888) 38 Ch.D. 263, 272, per Bowen L.J.”

394. The most recent edition of D Foskett, Foskett on Compromise (9th ed, 2020, Sweet & Maxwell) at 95 states that:

“An unimpeached compromise represents the end of the dispute or disputes from which it arose. Any issues of fact or law that may have formed the subject matter of the original dispute are buried beneath the surface of the compromise. The court will not permit them to be raised afresh in the context of a new action. If the parties have agreed that their original dispute may be resurrected in certain circumstances then, of course, the position may be different. The principle has been neatly stated judicially on a number of occasions:

In Plumley v Horrell (1869) 20 L.T. 473 at [3-60], Lord Romilly MR said this:

‘Prima facie everybody would suppose that a compromise means that the question is not to be tried over again. That is the first meaning of compromise. When I compromise a law suit with my adversary, I mean that the question is not to be tried over again.’” (footnotes omitted).

395. In Knowles v Roberts (1888) 38 Ch D 263 at 272, referred to in Prudential Assurance at 2005, Bowen LJ observed that the effect of a compromise was that a party to it could not “raise again every single matter which was the subject of dispute before”. His Lordship said at 272 that “[a]s soon as you have ended a dispute by a compromise you have disposed of it”, and that a party was precluded from raising “the matters which were the subject of the previous dispute”. It may be noted that this language is broader than the “causes of action” which formed the basis of the previous dispute.

396. The compromise in the present case was sufficiently broad, in my opinion, to preclude the Applicants from maintaining the contempt charges against Mr Ghaly. This was not because there was a release in terms against such charges, but the compromise put an end to the dispute between the parties inter se as to whether or not Mr Ghaly had retained documents contrary to the April 2018 Orders.

397. I am reinforced in this view by cl 9(b) of the Second Settlement Terms which contemplated that orders would be made by consent dismissing the claims made against Mr Ghaly in the Statement of Claim. Although no such orders have been made, equity would treat them as having been made and the terms of cl 9(b) itself bear upon the proper interpretation of cl 15 and what was intended by it. What was contemplated would be dismissed once and for all was the Applicants’ contention that Mr Ghaly had breached the April 2018 Orders. A declaration to that precise effect had been sought, and the conduct which would have founded that declaration was the “foundation” for the contempt charge against Mr Ghaly: cf. Port of Melbourne Authority v AnshunProprietary Limited (1981) 147 CLR 589 at 603; [1981] HCA 45.

398. The making of a consent judgment engages the principle of res judicata notwithstanding that in some cases it may be difficult to say what was necessarily decided by the judgment: see Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502 at 508; [1988] HCA 21 per Deane, Toohey and Gaudron JJ. The effect of the res judicata is not only to preclude the agitation of the same cause of action that had been resolved by the consent judgment, but also the issues determined or taken to have been determined by it. In Isaacs v The Ocean Accident and Guarantee Corporation Ltd (1957) 58 SR (NSW) 69 at 75 (Isaacs), Street CJ and Roper CJ in Eq observed that:

“It is clear that the mere fact that the judgment is by consent does not detract from its conclusive effect upon the issues determined by it: Re South American and Mexican Co; Ex parte Bank of England [1895] 1 Ch 37. But a judgment operates by way of estoppel only as to those matters which are necessarily decided by it. (Cf Blair v Curran (1939) 62 CLR 464, at p. 532; Jackson v Goldsmith (1950) 81 CLR 446, at p. 466).” (emphasis added).

399. The decision of Vaughan Williams J in In Re South American and Mexican Company; Ex parte Bank of England [1895] 1 Ch 37 at 42 was cited with approval by Barrett J (as his Honour then was) in Land Enviro Corp Pty Ltd v HTT Huntley Heritage Pty Ltd (2008) 72 NSWLR 160 at 175; [2008] NSWSC 185 at [63]. His Honour (at [64]) also referred to and followed Isaacs. At [61] of his judgment, Barrett J observed that:

“…if an order for dismissal is made by consent of all affected parties (that is, the claimant and all parties against whom the relevant claim has been brought)… [i]t is… a case in which all those parties have agreed that the dismissal is to be of the same force and effect as if there had been a hearing on the merits. An order for dismissal after such a hearing is clearly capable of raising an estoppel despite Pt 40 r 8: Newmont Pty Limited v Laverton Nickel NL (No 2) [1981] 1 NSWLR 221.”

Part 40 r 8 of the Supreme Court Rules, as referred to in the above passage, was the predecessor to s 91 of the Civil Procedure Act.

400. To similar effect, namely that a consent judgment can give rise to an issue estoppel, is the decision of the NSW Court of Appeal in Ekes v Commonwealth Bank of Australia (2014) 313 ALR 665; [2014] NSWCA 336 at [111] per Bathurst CJ (with whom Beazley P and Emmett JA, as his Honour then was, agreed). Referring to Blair v Curran (1939) 62 CLR 464 at 531-532; [1939] HCA 23, the Chief Justice noted that “[a]n issue estoppel will only arise in respect of those matters which a primary decree, order or judgment necessarily established as the legal foundation for the decision and nothing but that which is legally indispensable to the conclusion is thus finally closed or precluded”: at [112]. His Honour also noted that the subjective motivation of the parties to the consent judgment was irrelevant and that the question of its effect was objective: at [115].

401. In Tomlinson v Ramsey Food Processing Pty Limited (2015) 256 CLR 507; [2015] HCA 28 at [20]-[21] (Tomlinson), a plurality of the High Court explored the difference between res judicata and issue estoppel as follows:

“An exercise of judicial power, it has been held, involves ‘as a general rule, a decision settling for the future, as between defined persons or classes of persons, a question as to the existence of a right or obligation, so that an exercise of the power creates a new charterby reference to which that question is in future to be decided as between those persons or classes of persons’. The rendering of a final judgment in that way ‘quells’ the controversy between those persons. The rights and obligations in controversy, as between those persons, cease to have an independent existence: they ‘merge’ in that final judgment. That merger has long been treated in Australia as equating to ‘res judicata’ in the strict sense.

Estoppel in relation to judicial determinations is of a different nature. It is a common law doctrine informed, in its relevant application, by similar considerations of finality and fairness. Yet its operation is not confined to an exercise of judicial power; it also operates in the context of a final judgment having been rendered in other adversarial proceedings. It operates in such a context as estoppel operates in other contexts: as a rule of law, to preclude the assertion of a right or obligation or the raising of an issue of fact or law.” (footnotes omitted).

402. In my opinion, whether or not what was intended by cl 9 of the Second Settlement Terms to be a consent judgment was to be characterised as giving rise to a res judicata in the strict sense as described in Tomlinson as well as to an issue estoppel on the question of whether or not Mr Ghaly had breached his obligations created as a result of the April 2018 Orders, the Applicants were prima facie precluded from raising his breach of that obligation as a foundation for the subsequent contempt proceedings.

403. This conclusion does not turn on the evidence referred to at [148] above as to what was said during the mediation. To that extent, I accept the Applicants’ submission as to the relevance of that evidence. Nor does it depend on the principles of equitable estoppel which the Applicants addressed in detail in their supplementary written submissions in reply. Nor, importantly, did the Second Settlement Terms need to make any reference to future contempt proceedings.

404. The only potential qualification to this conclusion would be if there were some consideration of public policy arising from the fact that the charge against Mr Ghaly was for criminal contempt that operated to preclude his entitlement to rely upon the principles of res judicata and/or issue estoppel. In my opinion, there were none, and a consideration of authority supports this conclusion.

405. The first point to be made, which has been made throughout this judgment, is that the charges of contempt are brought in this Court’s civil jurisdiction: see Dowling.

406. Mr Hyde, on Mr Ghaly’s behalf, made reference to the decision of Merkel J in Louis Vuitton Malletier SA v Design Elegance Pty Ltd (2006) 149 FCR 494; [2006] FCA 83. His Honour accepted that, where the breach of a Court’s order gives rise to both private claims for relief and claims for contempt, then the private claims, at least, may be compromised: at [44]. Mr Hyde accepted that at [40]-[43], Merkel J raised the possibility that the private settlement of a contempt claim might still raise issues of public concern, but at [44], Mr Hyde indicated that his Honour did not go so far as to find that claims for contempt resulting from breach of a court order could not be compromised or settled.

407. Even if the compromise agreement in terms purported to release Mr Ghaly from any future contempt proceedings, such an agreement would not have been contrary to public policy. That follows from the High Court’s early decision in Kerridge v Simmonds (1906) 4 CLR 253; [1906] HCA 66 (Kerridge). In that case, the High Court held that a compromise of a dispute which had involved criminal proceedings for defamation was not contrary to public policy. Griffith CJ made reference to the judgment of Denman CJ in Keir v Leeman (1844) 6 QB 308, and that of Tindal CJ in the same case, when taken to the Court of Exchequer Chamber, where it was said (see Keir v Leeman (1846) 9 QB 371 at 395) that:

“Indeed it is very remarkable what very little authority there is to be found, rather consisting of dicta than decisions, for the principle, that any compromise of a misdemeanour, or indeed of any public offence, can be otherwise than illegal, and any promise founded on such a consideration otherwise than void. If the matter were res integra, we should have no doubt on this point. We have no doubt that, in all offences which involve damages to an injured party for which he may maintain an action, it is competent for him, notwithstanding they are also of a public nature, to compromise or settle his private damage in any way he may think fit. It is said, indeed, that in the case of an assault he may also undertake not to prosecute on behalf of the public. It may be so: but we are not disposed to extend this any further.” (emphasis added).

408. At Kerridge at 259, Griffith CJ made the point that an “agreement by an individual not to prosecute can only bind himself, and cannot prevent the assertion of the rights of the public by anyone else…”. This was the same point made by Perram J in Geneva Laboratories. The Chief Justice cited authorities where cases of oral slander and common assault were compromised even though they could have been dealt with by criminal prosecution. Griffith CJ expressed his ultimate conclusion (at 260) as follows:

“Where a person is entitled to recover pecuniary damages, the suggestion that there is a social duty incumbent upon him to prosecute is untenable. The law allows him either to prosecute or to sue for damages, and I can see nothing to prevent him from agreeing to receive an indemnity for the personal injury he has sustained, leaving the representatives of the public to prosecute if they think fit. If, as in some cases, he is the only person entitled to institute the prosecution, then â fortiori it is a matter of private, and not of public, concern.”

409. Barton J was in agreement with Griffith CJ in Kerridge. His Honour emphasised that, when the case law made reference to matters in which the public had an interest, it was referring to wrongs committed against the public as well as against an individual: at 262. Higgins J, too, was of the same opinion as the Chief Justice. His Honour saw the matter as one of common sense: at 263.

410. In Geneva Laboratories, the question before Perram J was whether the Court should proceed to deal with the First and Second Respondents for contempt of Court or whether, there having been an inter partes settlement of the Applicants’ contempt charge against them, the matter should be left to rest. The learned judge drew attention to the statement in Witham at 533 that “the ‘penal or disciplinary’ jurisdiction [to punish for contempt] may be exercised even when the parties have settled their differences and do not wish to proceed further” (emphasis added).

411. Implicit in this statement was that private parties to proceedings for contempt of Court may settle their differences. There was no suggestion in Witham that such a settlement was contrary to public policy: see also Canadian Transport (UK) Ltd v Alsbury (1952) 7 WWR (NS) 49; [1953] 1 DLR 385, cited by the Court in Witham, which appeared to accept that parties may settle or compromise a claim for contempt of Court, albeit that such a settlement would not prevent a court from dealing with the same contempt of its own motion. It was for this reason that Perram J noted that the critical word in the sentence quoted from Witham and extracted above was “may”.

412. The fact that, in the present case, the contempt application was not on foot at the time of the Second Settlement is not to the point for the reasons given at [393]-[404] above. The cases referred to in the preceding six paragraphs demonstrate that an agreement which has the effect of bringing to an end a claim for contempt of Court inter partes is not contrary to public policy. To the extent that Parker J expressed reservations about the ability of Mr Ghaly to rely on the Second Settlement Terms, that was in the context of an application for summary dismissal which was dealt with ex tempore and in which his Honour did not have the benefit of full argument.

413. It follows that, notwithstanding that the claim against Mr Ghaly is for criminal contempt in the sense of an alleged contumacious breach of court orders, it is brought in this Court’s civil jurisdiction (as reflected in the fact that the Notice of Motion was filed in the 2019 Proceedings) and was capable of being compromised, such a compromise not being contrary to public policy. Clause 15 of the Second Settlement Terms had the effect of discharging and releasing Mr Ghaly from the underlying claims in the 2019 Proceedings, namely that he breached the April 2018 Orders, and the effect of this release was that the Applicants were precluded from advancing a claim for contempt against him founded on the same allegation or claim. That that was the intended effect of cl 15 of the Second Settlement Terms, objectively ascertained, was confirmed by cl 9 which contemplated that consent orders would be made by the Court dismissing the claims against Mr Ghaly.

409. Although such consent orders have not been made, equity would treat that which ought to have been done as done. A dismissal of proceedings, even by consent, generates a res judicata or issue estoppel against the plaintiff to those proceedings in respect of the matters there alleged.

410. For these reasons, Mr Ghaly’s objection to the pursuit of the narrow contempt claim against him was a good one, and the charge should be dismissed for that reason. Prima facie he is entitled to his costs as following the event, but I will hear the parties on that issue.

Claimed inadvertent retention by Mr Ghaly

416. In the event that I am wrong in my conclusion as to the effect of cl 15 of the Second Settlement Terms, it is appropriate that I express a contingent view as to whether Documents 3 and 8 were retained in breach of the April 2018 Orders, and whether or not any retention (including of the admittedly retained Documents 1, 6 and 9) was inadvertent, as Mr Ghaly maintained.

417. With regard to Document 3, the real issue was whether or not it was a document that was from the Vivaldi Database. It was not recorded as such when the O’Leary Affidavit was affirmed for the purposes of the 2017 Proceedings. On the other hand, Mr Ghaly appeared to accept under cross-examination that the document was a Standard Operating Procedure from the Vivaldi Database: (T497.32-35 and T499.12-15) although it must be said that at other points in his evidence, he said he did not know whether it was on or came from the Vivaldi Database. He also indicated that it was simply a Microsoft Word Document: T498.28.

418. Reliance was placed on Mr Bova’s evidence that he had tried to search for the SOP by title and was unable to find it in the Vivaldi Database, but that when he used a keyword search, he found the exact document with a different title. He said the document was “word for word exactly the same” and that just because the SOP he had checked it against had a date of 16 April 2018 did not mean that that was the date it had been originally created: T385.17-22. Mr Bova’s evidence was that the SOP was not in the table of contents exhibited to the O’Leary Affidavit because the SOP number had been changed after November 2017: T387.30-42.

419. The evidence in relation to Document 3 was “messy”, to say the least. It began with what was in truth little more than an assertion by Mr Bova based upon the format of the document and its nature as a SOP. The evidence was improved by some further checking he undertook in the course of the hearing and for the purposes of his evidence, but still involved elements of assertion. Whilst I am of the view that Document 3 was likely to have been on the Vivaldi Database and hence was caught by the April 2018 Orders, notwithstanding Mr Ghaly’s evidence that I have highlighted at [418] above, I am not able to be satisfied of this beyond reasonable doubt.

420. With regard to Document 8, again I am unable to conclude that the spreadsheet attached to the email of 7 March 2017 came from the PK Software and as such was required to be delivered up pursuant to the April 2018 Orders. The entirety of the evidence in relation to this document was as summarised at [379] above. It rose no higher than evidence that the document may have derived from either point of sale data or the PK Software, and Mr Ghaly was not sure of which source.

421. It remains, then, to consider whether Mr Ghaly’s retention of Documents 1, 6 and 9 was inadvertent.

422. Mr Ghaly’s claim to inadvertent retention was vigorously attacked by Mr Dawson on behalf of the Applicants on the basis that the evidence disclosed that, in addition to the 13 documents referred to in para 11 of the Statement of Charge, Mr Ghaly had retained on both his Large and Small MacBook computer a significant number of other documents created using the Vivaldi Database and the PK Software, which were required to have been delivered up pursuant to the April 2018 Orders.

423. The Applicants submitted that although these documents did not form part of the charges against Mr Ghaly in the Statement of Charge, the fact that he had those documents on both MacBooks established that:

a.   his evidence about his supposedly inadvertent and unintentional failure to comply with the April 2018 Orders cannot be accepted, including that he did not believe that he had any documents falling within the relevant categories of the April 2018 Orders which were required to be delivered up; and

b.   he retained significantly more documents on his Large and Small MacBooks than the emails referred to in the Statement of Charge and in the Affidavit of Mr Ghaly sworn 19 September 2019 (the First Ghaly Affidavit).

424. Mr Ghaly’s claimed inadvertence in relation to the retention of the three documents the subject of the charge was also sought to be met by a vigorous challenge as to Mr Ghaly’s credibility which included, but was not confined to, his role in urgently ferrying material from NexGen’s premises to AAA’s premises on the morning of 19 February 2019 and his evidence in relation thereto.

425. I do not accept Mr Ghaly’s claim that his retention of these three documents was inadvertent. Had they been the only three Bova Chemist documents found on his MacBook computers, that claim may have had more plausibility. But they were not. The Applicants demonstrated through the evidence of Mr Bova, their cross-examination of Mr Ghaly and in final submissions, that Mr Ghaly had retained very valuable Competitor Analysis documents created using the PK Software on his Small MacBook: see [184]-[186] above.

426. The fact that his retention of these documents was not the subject of the Statement of Charge, whilst perhaps curious, did not mean that these further documents were irrelevant. Their retention bore on the likelihood or otherwise that Mr Ghaly’s retention of the three documents in question was intentional or, as Mr Ghaly claimed, inadvertent.

427. My conclusion that the retention of Documents 1, 6 and 9 was not inadvertent is supported by the adverse view I formed as to Mr Ghaly’s credit.

428. Elements of Mr Ghaly’s evidence whilst under cross-examination were very unimpressive. For example, he claimed that he had only found out that a search party was going to arrive at NexGen’s premises after he had moved the various items from NexGen’s premises to AAA’s premises (T522 –T523). This is highly unlikely, not least because of the urgency of his activity immediately following 9.45am and a string of SMS communications between Mr Ghaly and Mr Corry’s lawyer, Mr Athanassios, from 9.59am and throughout the morning of 19 February 2019.

429. I also do not accept Mr Ghaly’s claim in para 30 of the First Ghaly Affidavit that “[a]t no time was I aware of the search order”. Under cross-examination, he in fact accepted that Mr Corry did tell him on the morning of 19 February 2019 that there was a search order being executed and that a search party was going to arrive at NexGen’s premises that day (T536, T522.37-49, T538). It was also submitted in support of an attack on Mr Ghaly’s credit that, when the Search Party did arrive at the NexGen premises on the morning of 19 February 2019, Mr Ghaly did not disclose to the Search Party that there was equipment in AAA’s premises next door to NexGen’s premises (T527.10-12).

430. The Applicants submitted, and I accept, that much of Mr Ghaly’s evidence was “clearly designed to give the Court a false impression of innocence on the part of Mr Ghaly when quite the opposite is true.” The Applicants labelled Mr Ghaly’s claims that his running between premises moving documents and computers was because it was important that there was a pharmacist on site at all times, and his claim to have been duped by Mr Corry into removing extensive materials, including his own laptops, from the NexGen premises on the morning of 19 February 2019, as “ridiculous”. I quite agree.

431. Mr Ghaly also claimed, under cross-examination, that he had said nothing to the mechanics at the AAA premises about why he wanted to urgently store the items in their premises and denied, contrary to what was recorded by Mr Mackenzie based on his discussions with the mechanics at the AAA premises, that he had said that he was having “women troubles”. As the Applicants submitted, the:

“significance of this evidence is that it is entirely consistent with knowing full well that he was frustrating the Second Search Order having been told about it by Mr Corry. The fact that Mr Ghaly offered a false reason – ‘women troubles’ – as a reason for storing the items indicates that he knew that the real reason could not be disclosed.”

432. It is sufficient to conclude that I did not accept Mr Ghaly’s claims of inadvertent retention of documents and that, were it not for what I consider to be the preclusive effect of the Second Settlement Terms, I would have found the charge against Mr Ghaly made out, albeit limited to Documents 1, 6 and 9.

Conclusion

433. I make the following orders:

1. Declare that the First Respondent was in contempt of this Court by engaging in the conduct in the circumstances described in each of Charges 1, 2 and 4 (being paras 20, 21 and 23) of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

2. Dismiss Charge 3 against the First Respondent, being para 22 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

3. Declare that the Second Respondent was in contempt of this Court by engaging in the conduct in the circumstances in the first alternative described in para 24 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

4. Dismiss the charge against the Third Respondent, being para 25 of the Statement of Charge annexed to the Applicants’ Notice of Motion filed on 20 December 2019.

5. Dismiss the Notice of Motion filed by the First Respondent on 17 July 2020 with costs.

6. Direct the parties to file any submissions on the question of costs of no more than 4 pages by 2 July 2021, and any reply of no more than 2 pages by 16 July 2021.

7. Fix a directions hearing in relation to the remaining phase of the hearing at 9.30am on 22 July 2021, with any proposed directions as to the penalty hearing to be filed with the Associate to Bell P and served by 9.30am on 20 July 2021.

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Appendix, Statement of Charge (2169835, pdf)

Decision last updated: 24 June 2021