Orora Ltd v Lindsay Australia Ltd - [2015] VSC 215

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT

S CI 2015 01386

ORORA LIMITED	Plaintiff
v
LINDSAY AUSTRALIA LIMITED	Defendant

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JUDGE:	RIORDAN J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	18 May 2015
DATE OF JUDGMENT:	21 MAY 2015
CASE MAY BE CITED AS:	ORORA LTD v LINDSAY AUSTRALIA LTD
MEDIUM NEUTRAL CITATION:	[2015] VSC 215

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INJUNCTION – Discharge of interlocutory injunction – Change of circumstances – Balance of convenience – Possible obligations arising out of distribution agreement – Difficulty of court supervising compliance – Lower risk of injustice if order ‘wrong’.

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APPEARANCES:

Counsel

Solicitors

For the Plaintiff

Mr C Caleo QC

Mr M Costello
Mr D Snyder

Minter Ellison

For the Defendant

Mr S Anderson QC

Mr B Mason
Ms K Brazenor

McCullough Robertson Lawyers

HIS HONOUR:

This is an application by the defendant for an order to discharge the injunction made by me on 1 April 2015. The background to the dispute is set out in the reasons published as [2015] VSC 197 (‘the previous reasons’) and I adopt the same defined terms as in the previous reasons. The reasons set out below should be read in conjunction with the previous reasons.

In summary, the injunction granted on 1 April 2015 was based on the following findings:

(a)There was a serious question to be tried as to whether the defendant had validly terminated the 2010 Distribution Agreement;
(b)The balance of convenience between the parties was ‘finely balanced’ but, at the time of the grant of the injunction, the Court considered that liability between the parties was, in substance, a dispute about the construction of the 2010 Distribution Agreement which could be determined in a three day trial. On this basis, the parties agreed to waive the entitlement to arbitration in the 2010 Distribution Agreement and directions were given for the trial of this matter, which was to commence on 11 May 2015. After pleadings and service of witness statements, the Court was informed that the plaintiff would be calling 6 witnesses and the defendant would be calling 11 witnesses. The plaintiff estimated the duration of the trial at 7 to 10 days and the defendant estimated 11 to 13 days. As a result, the Court was unable to maintain the trial date in May and it has been necessary to refer the matter to the Commercial Court. It is likely that the matter will now be heard late this year or at the start of 2016.

In the previous reasons I stated:

I am very conscious of the potential detriment that might be caused to the respondent by reason of it being so restrained and, therefore, consider it a realistic prospect, if so convinced that this matter cannot be determined on an expedited basis, that the injunction could be discharged prior to final determination.[1]
[1]Orora Ltd v Lindsay Australia Ltd [2015] VSC 197 [43].

Accordingly, I say at the outset that I do consider that the fact that this dispute has…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] VSC 215
Decision Date: 21 MAY 2015

CaseChat Overview and Summary

In Orora Ltd v Lindsay Australia Ltd, Orora sought to discharge an interlocutory injunction imposed on Lindsay Australia. The injunction, originally issued to prevent Lindsay from disclosing confidential information, was challenged by Orora as circumstances had changed. The court was tasked with determining whether the change in circumstances warranted the discharge of the injunction. The legal issues centred around whether the balance of convenience had shifted in favour of Orora, and if there were possible obligations arising out of the distribution agreement that could be used to supervise compliance if the injunction were discharged. Additionally, the difficulty of the court supervising compliance and the relative risks of injustice if the order were 'wrong' were considered.

The court found that the change in circumstances did indeed affect the balance of convenience, shifting it in favour of Orora. It was determined that the original injunction was based on a specific set of facts that had since changed. Furthermore, the court noted that there were possible obligations arising out of the distribution agreement that could provide a basis for monitoring compliance if the injunction were discharged. This would mitigate the risk of irreparable harm. The difficulty of the court supervising compliance was also recognised, but it was concluded that the lower risk of injustice if the order were 'wrong' favoured discharging the injunction. Thus, the court held that the injunction should be discharged due to the changed circumstances and the altered balance of convenience.

In summary, the court discharged the interlocutory injunction based on the changed circumstances, the altered balance of convenience, and the presence of possible obligations arising from the distribution agreement that could facilitate compliance supervision. The difficulty of court supervision was acknowledged, but the lower risk of injustice if the order were 'wrong' led to the conclusion that the injunction should be discharged. This decision highlights the importance of regularly reviewing interlocutory injunctions in light of changing circumstances and the need for a flexible approach to equitable remedies.

Orders