The Big Fights Inc v Filmworld Pty Ltd Australian Olympic Committee v The Big Fights Inc
[1997] FCA 48
•3 Feb 1997
IN THE FEDERAL COURT OF AUSTRALIA )
NEW SOUTH WALES DISTRICT REGISTRY ) No NG 715 of 1996
GENERAL DIVISION )
BETWEEN:
THE BIG FIGHTS INC
Applicant
AND:
FILMWORLD PTY LIMITED
RespondentNo NG 49 of 1997
BETWEEN:
AUSTRALIAN OLYMPIC COMMITTEE
Applicant
AND:
THE BIG FIGHTS INC
First RespondentPETER WHITCHURCH PRODUCTIONS PTY LIMITED (ACN 000 213 258)
Second RespondentBECK HOLDINGS PTY LIMITED (ACN 000 166 594)
Third RespondentFILM WORLD PTY LIMITED (ACN 008 565 222)
Fourth RespondentLYNETTE JUNE BENSON
Fifth RespondentDIANE YVONNE TALBOT
Sixth Respondent
CORAM:Lindgren J
PLACE:Sydney
DATE:3 February 1997
REASONS FOR JUDGMENT (No 1)
(ex tempore)
Both of these proceedings relate to certain films of the 1956 Olympic Games held in Melbourne, Australia ("the Films"). In
proceeding NG 715 of 1996, the case of the applicant ("TBF") against the respondent ("Filmworld") is pleaded in a statement of claim filed on 30 August 1996. A defence by Filmworld was filed on 8 November 1996. There is an amended application which was filed on 18 September 1996. (I will turn to proceeding NG 49 of 1977 later in these Reasons.)
By a notice of motion filed on 19 December 1996 TBF seeks orders in terms of paras 1 and 2 of its claim for interlocutory relief set out in its amended application. Paragraphs 1 and 2 in the amended application are as follows:
"1.An order that the Respondent, its officers, servants and agents, and each of them be restrained from directly or indirectly selling, licensing, offering for sale or otherwise disposing of [the Films] or copies of any of them in any format whatsoever, and from authorising anyone else to do so.
Delivery up on oath to the Applicant all originals and copies of [the Films]."
Filmworld has previously given an undertaking in substance, if not precisely, in the terms of para 1. TBF does not press for the relief referred to in para 1, and its motion has proceeded as a motion for summary judgment for delivery up alone. TBF must, of course, satisfy the stringent test of "no triable defence" applicable to such a motion. Shortly, TBF's submission is that the circumstances show that Filmworld has never been entitled to refuse to deliver up the Films to TBF for the following reasons: the only right to possession of the Films which Filmworld ever had was derived from a bailor; it is common ground that that right has long since ceased; and TBF now derives title from the same bailor.
It is necessary now to go to the factual background. This may conveniently commence with a reference to Peter Whitchurch Productions Pty Ltd ("PWP"). It may be that the late Peter Whitchurch was at one time the proprietor or co-proprietor of the Films. Apparently, he died on 17 October 1981 and it may be that his widow, the late Elsie Mavis Whitchurch, who apparently died in September 1986, became his successor in title. It may be that PWP itself has had no more than a role in managing the marketing of the Films. Be all this as it may, what is important immediately is that by an agreement in writing dated 12 June 1990, PWP gave certain rights to Filmworld in respect of the Films, and Filmworld has not disputed on the hearing of the motion that the rights given by that agreement are the only rights that it has ever had in respect of them.
PWP was registered on 6 September 1957. The late Peter Whitchurch's son and two daughters were, and perhaps still are, the directors of PWP. According to an "Historical Company Extract" in evidence, the son, John Whitchurch, was appointed as director on a date not identified; the daughter Lynette June Benson was appointed on 7 October 1986; and the daughter Diane Yvonne Swan (now Diane Yvonne Talbot) was appointed on 24 October 1986. It was Ms Benson who signed the
agreement in writing with Filmworld to which I have referred, dated 12 June 1990. It recited that PWP was the copyright owner or was licensed to use and exploit the Films and had requested Filmworld to license the use of the Films to third parties and otherwise to promote the Films.
According to the agreement, the Films were the "absolute and unencumbered property" of PWP which had the absolute and unencumbered right and title "to license" the Films for the purposes contemplated by the agreement. PWP agreed to indemnify Filmworld against liability pursuant to any injunction or final judgment or settlement in respect of infringement of third party copyright arising from Filmworld's use of the Films. The period of the agreement was, relevantly, five years from 12 June 1990. Accordingly, the period of the agreement expired on 12 June 1995. However, since that date Filmworld has remained in possession of the Films.
The evidence does not show whether PWP attempted itself to recover possession of the Films after 12 June 1995. But on 6 February 1996, Ms Benson sent a handwritten fax to Eileen Naseby of Filmworld, reading as follows:
"Dear Eileen,
This fax is to let you know that I have made arrangements for all the 1956 Olympic Games films & the large record book belonging to P.W.P. to be picked up during this week.
Details of the arrangements that we have made with the films will be sent to you at a later date.
Yours faithfully
L Benson - DIRECTOR
P.S.The person picking up the films will have a letter from me giving him permission on my behalf to pick up the films.
LB"
The fax bore at the top the name "Peter Whitchurch Productions Pty. Ltd.".
On 16 February 1996, Ms Benson wrote a handwritten form of authority addressed to Jeff Patterson. Mr Patterson is, in fact, the Australian agent of TBF. That letter also bore at the top the name "Peter Whitchurch Productions Pty. Ltd.". It was as follows:
"Mr. Jeff Patterson,
This letter is to confirm the fact that I am giving you permission on behalf of Peter Whitchurch Productions to pick up the complete collection of the 1956 Olympic Games & the large record book which also belongs to P.W.P.
Thank you for your help.
Yours faithfully,
L. Benson - DIRECTOR"
It will be noted that neither letter mentions TBF at all.
The evidence shows that on or about Friday 16 February 1996, after receiving the letter from Ms Benson, Mr Patterson
attended at Filmworld's premises at 2 Whiting Street, Artarmon, and had a conversation with Ms Naseby, the managing director of Filmworld. He produced the letter of authority from Ms Benson which Ms Naseby appeared to read. She said that Mr Patterson would not be able to collect the Films at that time. In fact the Films were, and still are, held in a Greater Union film vault at Parramatta. Ms Naseby said that it would be necessary for Mr Patterson to make arrangements for a date and time for collection.
According to Mr Patterson's affidavit, shortly after Friday 16 February 1996, he had a further telephone conversation with Ms Naseby in which he made an arrangement to collect the Films at 12 noon on the following Friday, which may well have been Friday, 23 February 1996. In any event, on the Friday in question, Mr Patterson was running late and was not able to collect the Films by 12 noon. He telephoned Ms Naseby and told her of his predicament. She said that the man who was to hand over the Films to Mr Patterson at Parramatta would not be present at the vault after 12 noon. Accordingly, Mr Patterson and Ms Naseby then made an arrangement for Mr Patterson to collect the Films on another day the following week. On the previous analysis, that would have been the week commencing Monday, 26 February 1996.
According to Mr Patterson, a couple of days prior to the second date on which he was to collect the Films, he telephoned Ms Naseby to confirm the arrangement, but on this occasion she said that he could not collect the Films because other people had been asserting a right to them, with the result that she felt that she could not release them to him. He protested but she persisted in her refusal. As a result, Mr Patterson did not attend to collect the Films.
There is in evidence a letter dated as early as 2 March 1995 from Gadens Ridgeway, the solicitors for the estate of the Late Ronald Richard Beck and for Beck Holdings Pty Limited ("the Beck interests") to Ms Naseby, asserting that there was an "enforceable proprietary interest" in copies of the Films arising from the relationship between the late Mr Whitchurch, the late Mr Beck and their respective companies, in or about 1959/1960. It will be noted that the letter precedes the demand made by Mr Patterson by almost a year.
There is also in evidence a faxed letter dated 16 February 1996 written by Mr John Whitchurch as "CO-EXECUTOR - ESTATE OF E M WHITCHURCH, EXECUTOR - ESTATE OF R P WHITCHURCH" to Ms Naseby of Filmworld, advising her that she was not permitted to release the films to anyone except pursuant to the "joint request of the co-executors and trustees of the estate of E M Whitchurch". The letter concluded:
"This of course includes any representation now made by Peter Whitchurch Productions Pty Ltd."
Three days later, on 19 February, Russell McLelland & Brown, solicitors for Mr John Whitchurch, wrote to Filmworld on behalf of their client. The letter asserted that the original proprietor of the Films was their client's father; that upon his death on 17 October 1981 he had bequeathed them to his widow, Elsie Mavis Whitchurch; that she had died in September 1986; that their client was "an executor of the estate"; and that the role of PWP had been limited to that of managing the "marketing of the film copyright" "from time to time."
Finally, on 4 July 1996, the same solicitors wrote to Banki Palombi Haddock & Fiora, the solicitors for Filmworld. By that letter, they again advised that they acted for Mr John Whitchurch; that their client disputed the validity of any claim by TBF to any property in the Films or other assets of PWP; and that Filmworld should not part with possession and/or surrender custody of the Films without the prior written consent of John Whitchurch or a court order.
There was also a course of correspondence between TBF's solicitors, Dickson Fisher Macansh, and Filmworld's solicitors, Banki Palombi Haddock & Fiora. As early as 23 February 1996, Dickson Fisher Macansh asserted TBF's entitlement to possession of the Films, noted the advice of Mr Banki that there were competing claims, and noted an undertaking given by Filmworld not to sell, copy or otherwise dispose of the films.
On the same date, 23 February, Mr Banki replied and explained that his client, Filmworld, was facing claims by John Whitchurch and the estate of the late Ronald Beck and Beck Holdings Pty Limited (at that time a claim by the Australian Olympic Committee ("AOC") had not emerged - see later). Mr Banki's letter advised that his client regarded itself as the custodian of valuable property and recognised that it might be unwittingly liable if that property should be released into the wrong hands.
On 8 March 1996, Mr Banki faxed the respective solicitors for TBF, Mr John Whitchurch and the Beck interests. The fax acknowledged that the agreement pursuant to which Filmworld had been the manager of the Films had come to an end on 12 June 1995. Mr Banki referred to the fact that Ms Lyn Benson, on behalf of PWP, had purportedly granted a licence to TBF in respect of the Films. The fax included the following:
" ... our client has retained possession of the films until such time as the competing interests have resolved their differences. If proceedings are instituted to resolve the matter, our client intends to submit to the orders of the court."
The fax enclosed copies of correspondence which Mr Banki or his client, Filmworld, had received by way of assertions of the claims of the other parties. These included a series of agreements between PWP and TBF, the content of which I need not stay to discuss. The first, dated as early as 20 September 1983 was signed by John Whitchurch and the last three, dated 17 September 1993, 28 February 1994 and 8 December 1995 were all signed by Ms Benson.
It may be that the event which immediately caused TBF to commence the present proceeding NG 715 of 1996 against Filmworld on 30 August 1996 was the fact that some use had apparently been made of the Films or copies of them on television. In any event, on 29 August 1996, Dickson Fisher Macansh wrote to Mr Banki referring to the fact that parts of the Films had been the subject of two recent television broadcasts. Apparently the first of these occurred on Channel Nine or about 16 July 1996 and the second, on the Seven Network earlier in August 1996. Mr Banki, in a letter dated 3 September 1996 to Dickson Fisher Macansh, advised that Channel Nine and the Seven Network had already been in possession of the Films containing footage of the 1956 Olympic Games. His letter advised, however, that moneys had been paid by the television companies to Filmworld for the broadcast use of the Films and that Filmworld was holding the moneys received by it on behalf of the owners of the rights to the Films, pending a resolution of the dispute as to which party had those rights. Mr Banki advised that Filmworld had not been the supplier of the Films to the two television channels.
As I said, TBF launched proceeding NG 715 of 1996 against Filmworld on 30 August 1996, and has elected to proceed today on its motion for summary judgment. I have concluded that the case is clearly not one for summary judgment. Such generalisations as that a bailee is estopped from denying the title of his or her bailor and that a bailee may not plead jus tertii against his or her bailor, must be understood in the context of certain factual assumptions. The present application for summary judgment does not afford an appropriate occasion on which to discuss their true meaning and scope. It suffices for me to say why they do not entitle TBF to summary judgment, that is to say, why I think that there is a triable issue between the parties to proceeding NG 715 of 1996.
In resisting TBF's demand for delivery up to it, Filmworld is not asserting that PWP was not entitled to deliver to it possession of the Films for the period 12 June 1990 to 12 June 1995 or to grant to it the rights described in the agreement dated 12 June 1990.
PWP is not asking the Court to order Filmworld to deliver up to itself, to TBF or to anyone else; PWP is not even a party to proceeding NG 715 of 1996.
TBF relies on the two faxed letters from PWP to Filmworld dated 6 and 16 February 1996. The terms of those letters (quoted earlier) make it clear that Mr Patterson was authorised to collect the Films in right of PWP, yet it is TBF, not PWP, that is the applicant in proceeding NG 756 of 1996.
As I suggested in argument, it would be astounding that in a case, for example, in which the bailor had been convicted of having obtained the goods bailed by theft or in which there was other strong evidence that the bailor had not been their owner, the law should nonetheless require the bailee to deliver up to the bailor rather than to the person strongly indicated to be the true owner. It may well be that the true position is that the bailee must either deliver to the bailor or interplead, in either case without delay. I should record that submissions have not been made as to TBF's right to an order for delivery up apart from that founded on the two letters of February 1996 signed by Ms Benson.
The authority which was given to Mr Patterson was signed by Ms Benson. There is no evidence of a resolution of the board of directors of PWP and there is no document under the common seal of PWP. TBF submits that Filmworld is estopped from denying that PWP was bound by Ms Benson's signature by the fact that it had apparently been content to accept on 12 June 1990 that she was able to bind PWP on that date by signing the agreement by which PWP granted the licence to Filmworld. I do not accept the submission for the reasons given earlier for rejecting TBF's principal submission on estoppel. Moreover, it is arguable, particularly in the light of Mr John Whitchurch's stance, that even if Ms Benson had in fact had authority from PWP to grant the licence on 12 June 1990, it should not be inferred that she in fact had authority on its behalf nearly six years later in February 1996 to demand that Filmworld deliver up the Films to her nominee.
Further difficulties developed during the course of the hearing. A company extract showed that PWP was dissolved on 27 February 1992 consequent upon deregistration, and that on that date Mr John Whitchurch and his sisters, Ms Benson and Ms Swan (now Talbot), ceased to be directors of the company. As a result of three orders made on 14 June, 12 July and 6 September 1996 in proceeding NG 3192 of 1996 in this Court in which TBF was applicant, PWP first respondent and the Australian Securities Commission second respondent, the registration of PWP was reinstated pursuant to sub-s 574 (3) of the Corporations Law, possibly with effect from 21 June 1996. The reinstatement of registration post-dated the authority signed by Ms Benson in February 1996 in favour of Mr Patterson. Thus, real questions arose as to whether Ms Benson was a director of PWP as at 6 and 16 February 1996 when she signed the two letters of those dates.
At a late stage of the hearing, TBF tendered, and there was admitted into evidence, a copy of the memorandum and articles of association of PWP. According to the articles of association, the first directors of PWP were Reginald Peter Whitchurch and Elsie Mavis Whitchurch. Article 73 provides that at every ordinary general meeting of the company, each director is to retire from office and to be eligible for re-election, and that retiring directors are to act as directors throughout the meeting at which they retire. It remains unclear to me what the effect of the deregistration and restoration of the company had on the office of director as at February 1996.
Even if one were to assume that Ms Benson was in office in February 1996, she would not, by virtue of her being a "director" of PWP and nothing more, have the authority of an executive director, and, in particular, authority to give the direction which she gave to Filmworld in that month.
It may be that on a final hearing the difficulties to which I have referred, or some of them, will disappear or not prevail. I have merely attempted to show, without expressing final views, that it is a question deserving of a trial whether TBF is entitled to an order against PWP for delivery up of the Films.
There has been a further development which, in any event, has overtaken the motion for summary judgment. In November last year AOC appeared on the scene as a further claimant to the Films. AOC has commenced a separate proceeding, NG 49 of 1997, against TBF as first respondent, PWP as second respondent, Beck Holdings Pty Limited as third respondent, Filmworld as fourth respondent, Ms Benson as fifth respondent, and Ms Talbot as sixth respondent. It might be said that this proceeding will perform the role of an interpleader proceeding of a kind which, it might have been expected, Filmworld would have instituted. Filmworld lays no claim to be the beneficial owner of the Films and will play a passive role in the proceeding launched by AOC. In its proceeding, AOC has filed a notice of motion, and now an amended notice of motion, seeking relief directed to delivery up of the Films, not to AOC at this stage but to an entity qualified to be the custodian of them pending the final hearing and determination of the proceeding. As a result of the currency of AOC's proceeding, even if it had been otherwise appropriate as between TBF and Filmworld to give summary judgment, I would have stayed the order for delivery up pending the hearing and determination of AOC's proceeding. The inutility, in these circumstances, of a summary judgment for TBF against Filmworld affords a further reason why I would not in the exercise of my discretion, have granted it.
On AOC's motion evidence has been read as to the identity of an appropriate custodian of the Films. The parties have agreed that the facilities at the Greater Union film vault at Parramatta are not satisfactory for the purpose. At one stage TBF contended that an entity called "Video 8 Broadcast" was appropriate. AOC has suggested either "Atlab Australia", a division of AP Facilities Pty Limited, at 47 Hotham Parade, Artarmon ("Atlab"), or, alternatively, "Safe Tape & Film", a business of Comcopy Pty Limited, at Unit 1, 49 Hotham Parade, Artarmon ("Comcopy"). There is evidence annexed to an affidavit of Katherine Margaret Jordan, solicitor of Clayton Utz, the solicitors for AOC, of the facilities provided by Atlab and Comcopy and their respective costs. TBF resists an order that Filmworld deliver up to either of those entities. In place of its earlier nominee, Video 8 Broadcast, it now suggests that delivery up should be to "Recall Total Information Management" of 687 Gardeners Road, Alexandria ("Recall"). There is evidence of the nature of the facilities provided by Recall.
In effect, I am asked to choose between three "tenderers". There has not been, in submissions, a close analysis of the three "tenders", but my present inclination is to favour Comcopy. There is no evidence to suggest that Comcopy is not a satisfactory repository for the Films. Such comparison as has been done suggests that the periodical charge by Comcopy may be less than that of Recall but I would not decide the matter on that basis. The description of the facilities provided by Comcopy is more detailed and ample than that provided by Recall, but, as perhaps might be expected, each is in part an exercise in self promotion. Unless I am persuaded otherwise by submissions made this evening or tomorrow morning, I will make orders tomorrow morning for delivery to Comcopy and retention by it pending the final hearing and determination of the proceeding.
I return now to TBF's motion for summary judgment. I will, in due course, dismiss it for the reasons already given. But it seems to me that to some extent Filmworld must bear responsibility for the costs which have been incurred in proceeding NG 715 of 1996. When a bailee is in the position in which Filmworld found itself, it should promptly resort to the interpleader procedure. Filmworld did not do so and months passed before the steps taken by AOC made out a strong case for deferral of a decision on the issue of entitlement to possession as between TBF and Filmworld. It may be that most of the costs in proceeding NG 715 of 1996 have been the costs of today (the hearing has occupied virtually the entire day). One approach to costs would be to order Filmworld to pay TBF's costs down to the hearing and to order TBF to pay Filmworld's costs of the hearing today. A second would be to make no order as to the costs of the motion. A third is the one which appeals to me. I think that the appropriate course, bearing in mind that the motions in the two proceedings have been heard together and that evidence in each has been evidence in the other, is to make the costs of the parties (TBF and Filmworld) to the motion in proceeding NG 715 of 1996, part of their respective costs of that proceeding, so that the issue of the costs of TBF's motion will be determined by the ultimate order for costs to be made in that proceeding.
In proceeding NG 49 of 1997, certain orders have, at least generally, been agreed to. I make orders 1, 2, 3, 4, 5 and 6 in the form of short minutes of orders initialled by me, dated today and placed with the papers. I note for the record that that proceeding will stand over to 9 April 1997 at 9.30 am for further directions. As well, in that proceeding, my present intention is to make, tomorrow morning at 9.30 am, on AOC's amended notice of motion, orders 2 and 3 and order 4 down to the word "court", order 6, and an order that the costs of the parties to AOC's motion be part of the costs of those respective parties of proceeding NG 49 of 1997 generally.
I stand over both proceedings until 9.30 am tomorrow morning. My present intention is that in proceeding NG 715 of 1996 tomorrow morning I will make the orders foreshadowed on TBF's motion and stand over that proceeding also to 9 April 1997 at 9.30 for further directions. If any party wishes to make a submission in proceeding NG 49 of 1997 on the question of the identity of the appropriate interim custodian of the Films, that submission must be sent by fax to my Associate this evening. Otherwise, proceeding NG 49 of 1997 is also stood over to 9.30 am tomorrow morning for the making of orders.
I certify that this and the preceding 17 pages are a true copy of the Reasons for Judgment of the Honourable Justice Lindgren.
Associate:
Dated:11 February 1997
Heard: 3 February 1997
Place: Sydney
Decided: 3 February 1997 (in part)
Appearances: Ms J Baird of counsel instructed by Ms K Jordan of Clayton Utz, solicitors, appeared for the applicant in proceeding NG 49 of 1997 (AOC).
Mr R Horsley of counsel instructed by Dickson Fisher Macansh appeared for the applicant in proceeding NG 715 of 1996 and the first respondent in proceeding NG 49 of 1997 (The Big Fights Inc).
Mr P Banki, solicitor, of Banki Palombi Haddock & Fiora, appeared for the respondent in proceeding NG 715 of 1996 and the 4th respondent in proceeding NG 49 of 1997 (Filmworld Pty Ltd).
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