Pig Latin Pty Ltd v Greenstream Pty Ltd
[2012] VCC 960
•16 July 2012 (revised)
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted |
AT MELBOURNE
CIVIL DIVISION
COMMERCIAL LIST
GENERAL DIVISION
Case No. CI-11-03094
| PIG LATIN PTY LTD (ACN 074 510 151) | Plaintiff |
| v | |
| GREENSTREAM PTY LTD (ACN 108 062 924) | First Defendant |
| and | |
| ROSLYN DENISE FIELD | Second Defendant |
| and | |
| WILLIAM LINDSAY FIELD | Third Defendant |
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JUDGE: | HIS HONOUR JUDGE GINNANE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 14 and 15 June 2012; 16 July 2012 | |
DATE OF JUDGMENT: | 16 July 2012 (revised) | |
CASE MAY BE CITED AS: | Pig Latin Pty Ltd v Greenstream Pty Ltd & Ors | |
MEDIUM NEUTRAL CITATION: | [2012] VCC 960 | |
REASONS FOR JUDGMENT
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PRACTICE – document produced in proceeding - application by opposing party for leave to use to obtain advice about rights and in subsequent proceedings- release from implied undertaking attaching to document
PRACTICE – application for production of document referred to in affidavit for inspection – inappropriate once proceeding concluded - County Court Civil Procedure Rules 2008, O 29.10
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Clough | Lennon Mazeo |
| For the Second and Third Defendants | Mr Z Partos (on 16 July 2012) | Macpherson & Kelly Lawyers Pty Ltd |
HIS HONOUR:
1 The plaintiff, by Summons, seeks to be granted leave to adduce evidence of the Field Intellectual Property Assignment Deed produced in these proceedings by the third defendant, William Lindsay Field, in proceedings relating to the alleged infringement of a patent and of the Intellectual Property Rights Agreement made between Mr Field and Martin Cumberlidge dated 1 December 2007.
2 As the argument developed, the plaintiff indicated that it wished to use the Deed to first obtain advice about whether it should commence a proceeding.
3 On 14 December 2011, the Court gave judgment in favour of the plaintiff against the second and third defendants jointly and severally in the amount of $728,836.21 plus interest and costs.
4 Mr Cumberlidge, who is a director of the plaintiff, in his supporting affidavit, states that he and Mr Field conceived of a joint investment, being the development of a cash remittance system for cellular devices called M2 Cash and decided to utilise Redepay Ltd (“Redepay”) to commercialise it. He states that he developed the software architecture design for the system, which formed the basis of a patent application and that a patent was subsequently granted. Mr Cumberlidge states that he and Mr Field finalised the terms of the Deed of Licence agreement to licence the product to Redepay and of a separate Intellectual Property Rights Agreement to recognize their equal interests in the M2Cash product, as joint owners, as at 1 December 2007. The Licence Agreement was later terminated.
5 Mr Cumberlidge states that Redepay was under-capitalised and that the plaintiff advanced various sums to it. The judgment given against the second and third defendants was in respect of a loan made by the plaintiff to the first defendant, which they had guaranteed.
6 After judgment was obtained, the second and third defendants filed an application for an order for payment of the judgment debt by instalments. That application was eventually unsuccessful as a result of the order made by Judge Lewitan on 15 May 2012. As part of the instalment order application, Mr Field filed an Affidavit of Financial Situation suggesting that he was owed large sums of money by 888Red Pty Ltd. The plaintiff filed a Notice to Produce documents and in response, Mr Field produced documents, including “The Field Intellectual Property Assignment Deed” dated 21 May 2011, which is Exhibit 4 to Mr Cumberlidge’s affidavit.
7 Mr Cumberlidge states, that having read that document, it is evident to him that the third defendant had attempted to circumvent the terms of, and had breached, the Intellectual Property Agreement by purporting to assign to 888 Red Pty Ltd all of the intellectual property rights associated with the M2 Cash product. He also alleges that that the Field Intellectual Property Assignment Deed infringed the patent. He states that he believes that the interests of justice would be advanced by bringing to the attention of the Court in appropriate proceedings the matters contained in his affidavit.
8 When the matter came before the Court in June, I decided that further service of the Summons and supporting affidavit should occur because the relevant defendants reside in New South Wales and appeared to have limited contact with the Melbourne solicitor who had previously represented them. The second and third defendants were represented this morning and their counsel ably presented their position to the Court. They consent to the orders sought in the Summons. They also seek to inspect Exhibits 2 and 3, to Mr Cumberlidge’s affidavit. Those exhibits are the Intellectual Property Rights Agreement and the Deed of Licence.
9 The consent of the second and third defendants to the plaintiff’s application is relevant. For the Court to grant leave as sought by the plaintiff, it needs to be satisfied that there are special circumstances warranting release of the plaintiff from the implied undertaking attached to the Field Intellectual Property Assignment Deed, which was produced by Mr Field, that it will only be used for the purposes of the proceeding.
10 The establishment of special circumstances does not require that some extraordinary factors must be established before the discretion will be exercised. It is sufficient that in all the circumstances good reason must be shown why, contrary to the usual position, documents produced, or information obtained in one piece of litigation, should be used for the advantage of a party in another piece of litigation or other non-litigious purposes[1].
[1]Liberty Funding Pty Ltd v Phoenix Capital Ltd [2005] FCAFC 3 at [31]
11 The authorities are discussed by Edmonds J in James G Oberg (Sales) Pty Ltd v Oberg,[2] and by Vickery J in Ambridge Investments Pty Ltd (In Liquidation)(Receiver appointed) v Baker & Ors No 3.[3] In the latter case, Vickery J referred to the High Court decision of Hearne v Street[4]. His Honour emphasised that it was important that the documents, for which release from the undertaking was sought, are specified and that the scope of the causes of action and the remedies the applicant may seek in the new proceeding, are defined.
[2][2012] FCA 722
[3][2010] VSC 545
[4](2008) 235 CLR 125
12 In this case, consent, as I have stated, is relevant and that was made clear in the judgment of Lindgren J in Allen & Hanburys Ltd v Pan Laboratories Pty Ltd,[5] to which counsel for the plaintiff referred me. That was also a case in which the new litigation had not been commenced and the purpose of seeking release from the undertaking was to obtain advice, about the applicant’s legal rights.
[5]BC9507522; unreported, Federal Court of Australia, 4 May 1995
13 In this case, I am satisfied that the plaintiff has established the existence of special circumstances justifying its release from the implied undertaking. These include first, the consent of the second and third defendants. It is true that the consent was to the orders sought in the Summons, which were directed to the use of the document in new proceedings and that the plaintiff wants to use the document first to obtain advice, but that difference is not significant. Second, the fact that the effect of the document has been referred to, and relied on, in this proceeding by Mr Field as part of an instalment payment application. Third, the plaintiff wishes to obtain legal advice about the document and properly plead any cause of action it may have arising from the Field Intellectual Assignment Deed. Fourth, the causes of action that the plaintiff alleges that it may have, involve the protection of a patent, which Lindgren J in Allen & Hanburys identified as an important factor.
14 For those reasons, I am satisfied that it is appropriate to make orders permitting the plaintiff to use the document in the manner it proposes. I will make orders in terms similar to those made by Lindgren J.
15 The other issue that has been raised this morning is whether or not the second and third defendants should have access to the original of Exhibits 2 and 3 to the affidavit of Mr Cumberlidge. Exhibit 2 is a one-page document dated 1 December 2007 entitled “Intellectual Property Rights Agreement”, which purports to be signed by Mr Field and by Mr Cumberlidge. Exhibit 3 is a document entitled “Deed of Licence Intellectual Property” which purports to be made between Mr Field and Mr Cumberlidge and Redepay Pty Ltd.
16 Counsel for the second and third defendants has referred to Rule 29.10, which provides that where in any affidavit, reference is made to a document, the other party may, by notice to produce served on that party, require that party to produce the document for inspection. No notice to produce has been given, but the second and third defendants submit that the Court should make an order giving them that right of inspection.
17 Copies of the documents have been produced as exhibits to Mr Cumberlidge’s affidavit. The second and third defendants seek to inspect the original of those documents.
18 Although counsel for those defendants has not unreservedly limited his clients to this course, it appeared that their purpose in obtaining the originals of the exhibits was to assist them in any further litigation that may be brought against them by the plaintiff. The affidavit of Ms Mitchell, the second and third defendants’ solicitor, substantially confirms that that was a purpose. Counsel for the plaintiff has apparently indicated that counsel for the second and third defendants could look at the original of the documents at Court this morning, but that is not the sort of inspection that the second and third defendants seek. Rather, it appears that they wish to examine the documents, perhaps with the assistance of an expert, for the purposes of determining whether they have been signed as alleged.
19 As I indicated in discussion with counsel, I could see the rough logic in the approach taken by the second and third defendants. Their consent to the orders sought by the plaintiff has been a factor I have taken into account in granting the plaintiff’s application. While that consent was not determinative of the application, it was significant.
20 However, I do have to decide the second and third defendants’ application by the application of relevant principle. Rule 29.10 is primarily directed at assisting a party to ongoing litigation. Judgment in this case was entered in December 2011 and, although applications were made for instalment orders, the proceeding has come to an end. In those circumstances, I do not consider it is appropriate for the Court to require the plaintiff to make the original of Exhibits 2 and 3 available for inspection.
21 No doubt, if further litigation is brought, the second and third defendants, if involved in that litigation, will have the usual right to seek to obtain documents for legitimate purposes.
22 I grant the plaintiff’s application.
23 I refuse the application made by the second and third named defendants.
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