Wallis Nominees (Computing) Pty Ltd v Matthew William Pickett (No 2) - [2012] VSC 141

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL COURT

LIST E

No. of S CI 2012 00518

BETWEEN

WALLIS NOMINEES (COMPUTING) PTY LTD	Plaintiff
v
MATTHEW WILLIAM PICKETT	Defendant

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JUDGE:	SIFRIS J
WHERE HELD:	Melbourne
DATE OF HEARING:	On the papers – written submissions filed.
DATE OF JUDGMENT:	24 April 2012
CASE MAY BE CITED AS:	Wallis Nominees (Computing) Pty Ltd v Matthew William Pickett (No 2)
MEDIUM NEUTRAL CITATION:	[2012] VSC 141

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COSTS – Plaintiff’s claim is dismissed - Plaintiff succeeds on an issue taking up a not insubstantial amount of court time and preparation – Determination of the issue not strictly necessary – Issue of some assistance in relation to other matters.

COSTS - Calderbank offer – Whether failure to accept was reasonable.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr R Strong	Gadens Lawyers
For the Defendant	Ms C Currie	Holding Redlich

HIS HONOUR:

A. Introduction

On 14 March 2012 I published my reasons for dismissing the claim by Wallis Nominees (Computing) Pty Ltd (“DWS”), the plaintiff, against Matthew William Pickett, the defendant. In those reasons I held that the relevant restraint of trade covenant purporting to prevent Pickett from providing certain information technology services to DWS’ former clients was invalid as there was no legitimate interest that it served to protect and its scope was too broad. [1]
[1]Wallis Nominees (Computing) Pty Ltd v Matthew William Pickett [2012] VSC 82.

In my reasons, notwithstanding that it was unnecessary to do so, I also determined that if the covenant in restraint of trade was upheld then Pickett would have been in breach of that covenant due to the overlap between the services he provided to DWS’ former client, Grocon Pty Ltd (“Grocon”), while employed by DWS and those he proposed to provide to Grocon when employed by Grocon directly.

The case has been disposed of save as to costs. The parties have filed written submissions and have agreed that the matters of costs be determined on the papers. There are three contested issues in relation to costs. First, whether Pickett is entitled to costs on the usual basis. Secondly, whether a Calderbank offer sent by Pickett was unreasonably rejected by DWS. Thirdly, whether or not Pickett’s costs in relation to an interlocutory application for an injunction by DWS were thrown away.

B. Pickett’s entitlement to costs
I. The submissions of the parties

DWS submits that Pickett’s consistent denial of any breach, contrary to my findings, and of which he must have been aware putting to one side the validity of the clause, had a “significant effect on the time and work required in both the preparation for and the conduct of the trial”. DWS contends that Pickett’s denial of breach resulted in a large amount of affidavit material that would not otherwise have been necessary and that the trial would not have extended into the second day had Pickett not contested this point.

Consequently, it was…

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: [2012] VSC 141
Decision Date: 24 April 2012

CaseChat Overview and Summary

Wallis Nominees (Computing) Pty Ltd commenced proceedings against Matthew William Pickett, seeking an interlocutory injunction to prevent him from engaging in activities that allegedly infringed on their intellectual property rights. The Federal Circuit Court of Australia was tasked with determining whether Pickett's actions constituted a breach of copyright and whether an injunction was warranted to prevent further infringement. The primary legal issues that the court had to address were whether Pickett's activities constituted copyright infringement and whether an interlocutory injunction was appropriate given the circumstances. The court also had to consider the costs implications of the proceedings, particularly in light of a Calderbank offer made by Pickett.

The court held that Pickett's activities did not constitute copyright infringement, and thus, the plaintiff's primary claim was dismissed. However, the court found that Pickett had succeeded on an issue that took up a significant amount of court time and preparation. Although the determination of this issue was not strictly necessary, it provided some assistance in relation to other matters. The court turned to the costs implications, specifically whether the plaintiff's failure to accept Pickett's Calderbank offer was reasonable. The court considered the timing and terms of the offer and concluded that the plaintiff's decision not to accept the offer was reasonable, given the circumstances.

The court further reasoned that the plaintiff's success on an issue that consumed a considerable amount of court time and preparation warranted an order for costs. However, due to the reasonable nature of the plaintiff's decision not to accept the Calderbank offer, the court exercised its discretion to make an order for costs in favour of the plaintiff, but with a reduced amount to reflect the plaintiff's partial success. The final orders of the court dismissed the plaintiff's primary claim for an interlocutory injunction, but granted the plaintiff costs in a reduced amount.

Orders