Wu v United Overseas Bank Ltd, Sydney Branch
[2021] FedCFamC2G 209
•29 October 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Wu v United Overseas Bank Ltd, Sydney Branch [2021] FedCFamC2G 209
File number(s): SYG 1844 of 2021 Judgment of: JUDGE MANOUSARIDIS Date of judgment: 29 October 2021 Catchwords: PRACTICE AND PROCEDURE – on 28 October 2021 the Court granted interim injunctions in favour of respondent without considering whether it should do so on the condition that respondent give the usual undertaking as to damages – matter relisted for the purpose of hearing submissions whether injunctions should be discharged and injunctions in the same terms be granted but on condition that usual undertaking as to damages is given – usual undertaking as to damages given – injunctions previously granted discharged and replaced with injunctions in same terms. Cases cited: Combet & Anor v Commonwealth of Australia & Ors [2005] HCATrans 459 Division: Division 2 General Federal Law Number of paragraphs: 7 Date of hearing: 29 October 2021 The Applicant: Appeared in person, by telephone Counsel for the Respondent: Ms K Nomchong SC, by telephone Solicitor for the Respondent: Allens ORDERS
SYG 1844 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: CHAOXIAN WU
Applicant
AND: UNITED OVERSEAS BANK LTD, SYDNEY BRANCH
Respondent
ORDER MADE BY:
JUDGE MANOUSARIDIS
DATE OF ORDER:
29 OCTOBER 2021
THE COURT ORDERS THAT:
1.Orders 1 and 2 of the orders made on 28 October 2021 are discharged.
ON THE RESPONDENT BY ITS COUNSEL GIVING THE USUAL UNDERTAKING AS TO DAMAGES THE COURT ORDERS THAT:
2.By 4:00 pm on 29 October 2021 the applicant make available for collection at her residential address the respondent’s laptop, such laptop to be delivered to the respondent’s lawyers, and to be held by such lawyers until further order of the Court.
3.Up to and including 5:00 pm on 2 November 2021 the applicant, by herself and by her agents, is restrained from using information in her possession that directly or indirectly concerns the business of the respondent, except for any record of the applicant’s terms and conditions.
THE COURT NOTES THAT:
4.The “usual undertaking as to damages” that appears in the notation immediately above order 2 has the meaning given to that expression by paragraph 2.2 of Federal Court of Australia practice note “Usual Undertaking as to Damages Practice Note (GPN-UNDR)”.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
At the end of the first court date hearing of this matter on 28 October 2021 I granted two interlocutory injunctions against the applicant. The first requires the applicant to make available for collection by the respondent by 4:00 pm on 29 October 2021 a laptop the applicant used while employed by the respondent, but which she has kept in her possession after the respondent purportedly terminated her employment. The second injunction restrains the applicant, up to 5:00 pm on 2 November 2021, from using information relating to the respondent’s business.
I granted these injunctions after the applicant, who is not legally represented, made statements that suggested she had in her possession documents that arguably contained information that was confidential to the respondent; and that the applicant intended to disseminate that information in a manner not authorised by the respondent. I also made orders that the respondent file and serve an application in a case for relief in relation to the confidential information the respondent claimed the applicant held, and that the application in a case be made returnable before me at 2:00 pm on 2 November 2021.
In the evening of 28 October 2021, unprompted by anything in particular, it occurred to me I had granted the injunctions without inquiring from senior counsel for the respondent whether the respondent would give the usual undertaking as to damages. My failure to make such inquiry, and my granting the injunctions without requiring the respondent to give an undertaking as to damages, was an error.
The purpose and importance of requiring an undertaking as to damages as a condition of the granting of interlocutory injunctions and other interlocutory relief have been referred to in the authorities. A useful statement was given by Heydon J in Combet & Anor v Commonwealth of Australia & Ors, where his Honour said:[1]
[1] Combet & Anor v Commonwealth of Australia & Ors [2005] HCATrans 459, at lines 1545-1585
In my judgment, the Court will almost always decline to grant an interlocutory injunction unless the plaintiff undertakes to the Court to pay any damages which the Court may later assess as necessary to compensate the defendant for any harm caused by the interlocutory injunction in the event that the Court at the final hearing refuses to grant a final injunction. The importance of the undertaking is that without it a defendant ultimately successful at the final hearing would not be able to recover damages for any loss suffered by complying with the interlocutory injunction.
In the Full Court in Air Express Limited v Ansett Transport Industries (Operations) Pty Limited [1981] HCA 75; (1981) 146 CLR 249 Mr Justice Gibbs at 311‑312 said:
The object of requiring a plaintiff who seeks an interlocutory injunction to enter into an undertaking of this kind is to attempt to ensure that a defendant will receive compensation for any loss which he suffers by reason of the grant of the injunction if it appears in the event that the plaintiff was not entitled to obtain it. The insistence upon the giving of an undertaking is a very important, if not an essential, means of preventing injustice from being done by the court when it makes an order at an interlocutory stage, before the rights of the parties have been finally determined. The court has a discretion not to enforce such an undertaking, but unless the defendant has been guilty of conduct that would render it inequitable to enforce the undertaking it would seem just, speaking generally, that a plaintiff who has failed on the merits should recompense the defendant for the damage that he has suffered as the result of the making of the interlocutory order.
At page 260 the primary Judge, Mr Justice Aickin, quoted Lord Justices James, Cotton and Thesiger in Graham v Campbell (1878) 7 Ch D 490 at 494 to this effect:
If any damage has been occasioned by an interlocutory injunction, which on the hearing is found to have been wrongly asked for, justice requires that such damage should fall on the voluntary litigant who fails, not on the litigant who has been without just cause made so.
Mr Justice Stephen agreed generally with what Mr Justice Aickin said at page 315.
Realising the error I made, in the morning of 29 October 2021 I caused the Court Registry to send to the parties the following email (Court email):
In making orders 1 and 2 yesterday Judge Manousaridis did not ask senior counsel for the respondent whether the respondent would give the usual undertaking as to damages as a condition to his Honour making orders 1 and 2. (By “usual undertaking as to damages" his Honour refers to the meaning given to that expression in paragraph 2.2 of Federal Court of Australia practice note “Usual Undertaking as to Damages Practice Note (GPN-UNDR)”).
His Honour considers he erred in making orders 1 and 2 without inquiring of senior counsel for the respondent whether the respondent would give the usual undertaking as to damages (see Combet & Anor v Commonwealth of Australia & Ors [2005] HCATrans 459, at lines 1530-1649); and, for that reason, orders 1 and 2 are liable to be discharged (see National Australia Bank Ltd v Bond Brewing Holdings Ltd [1991] VicRp 31).
His Honour proposes to list the matter at 1:00 pm today for the purpose of hearing submissions on why his Honour should not make orders to the following effect:
THE COURT ORDERS THAT:
1. Orders 1 and 2 of the orders made on 28 October 2021 are discharged.
ON THE RESPONDENT BY ITS COUNSEL GIVING THE USUAL UNDERTAKING AS TO DAMAGES THE COURT ORDERS THAT:
2.By 4:00 pm on 29 October 2021 the applicant make available for collection at her residential address the respondent’s laptop, such laptop to be delivered to the respondent’s lawyers, and to be held by such lawyers until further order of the Court.
3.Up to and including 5:00 pm on 2 November 2021 the applicant, by herself and by her agents, is restrained from using information in her possession that directly or indirectly concerns the business of the respondent, except for any record of the applicant’s terms and conditions.
THE COURT NOTES THAT:
4.The “usual undertaking as to damages” that appears in the notation immediately above order 2 has the meaning given to that expression by paragraph 2.2 of Federal Court of Australia practice note “Usual Undertaking as to Damages Practice Note (GPN-UNDR)”.
The applicant and the respondent, by its senior counsel, appeared by telephone before me at 1:00 pm on 29 October 2021. Senior counsel for the respondent indicated the respondent would give the usual undertaking as to damages, and otherwise consented to my making orders to the effect set out in the Court email. I explained to the applicant the meaning of “undertaking as to damages”. The applicant said she was anxious; but I explained to her that what I proposed to order would not alter the position as it existed immediately after I made the orders on 28 October 2021, other than to record that the respondent will have given the usual undertaking as to damages. I then made orders to the effect set out in the Court email, and noted I would publish my reasons later. These are my reasons.
It could be said that it would not have been necessary to discharge the injunctions I granted without my being satisfied the applicant has suffered or may suffer damage. Even if that is correct, the fact is that I granted the injunctions without doing that which I ought to have done, namely, require the respondent to give the usual undertaking as to damages. That by itself has triggered a discretion to set aside the injunctions; and the fact the applicant may not have suffered any damage does not weigh against setting aside orders I ought not to have made without requiring an undertaking as to damages.
I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Manousaridis. Associate:
Dated: 29 October 2021
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