Flow Software Trading Limited v Hart - [2020] NZHC 2928

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-1139

[2020] NZHC 2928

UNDER the Fair Trading Act 1986

BETWEEN

FLOW SOFTWARE TRADING LIMITED

First plaintiff

FH NUMBER 18 LIMITED
Second plaintiff

FH NUMBER 16 LIMITED
Third plaintiff

AND

CAMERON NELSON HART

First defendant

BREW INTEGRATION LIMITED
Second defendant

VELOX EDI LIMITED

Third defendant

Hearing: On the papers

Appearances:

E C Gray for the plaintiffs

R J Latton for the defendants

Judgment:

6 November 2020

JUDGMENT OF JAGOSE J

[Costs]

This judgment was delivered by me on 6 November 2020 at 4.00pm.
Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Counsel/Solicitors:
E C Gray, Barrister, Auckland R J Latton, Barrister, Auckland
Kindrik Partners – Auckland Branch (A J Dickson) Sweetman Law, Auckland (A J Sweetman)

FLOW SOFTWARE TRADING LTD v HART - Costs [2020] NZHC 2928 [6 November 2020]

[1] Pending trial of the plaintiffs’ claims the defendants threatened to breach confidence, and acted misleadingly and deceptively in trade in breach of s 9 of the Fair Trading Act 1986, the plaintiffs sought interim injunctions to restrain the defendants from publishing particular information or representing any association with the plaintiffs, and to require the defendants to deliver specified material intended to be published first to plaintiffs for inspection.

[2] Ultimately my judgment was not required, the parties agreeing on interim terms after the day’s hearing, except as to costs. My preliminary view was:1

So far as costs are concerned, although costs on interlocutory applications usually follow the event, to require “the party who fails with respect to … an interlocutory application [to] pay costs to the party who succeeds”, an award of costs nonetheless is to “reflect the complexity and significance of the proceeding”. The present consensual circumstances in combination lead me to the preliminary view costs on this interlocutory application should be reserved for determination consistently with the result of the substantive proceeding – that is to say, for payment by the party who fails at trial.

[3] The plaintiffs say their interlocutory application nonetheless was necessary to protect their perceived risk, as reflected in the consensual relief’s closeness to the sought orders, rendering them the successful parties for costs purposes. The defendants respond they identified the plaintiffs’ prospective risk and sought information from the plaintiffs to identify if it had substance, to which the plaintiffs’ interlocutory applications were issued instead. The ultimate consensual relief leaves determination of risk in the defendants’ hands, rather than in those of the plaintiffs as was sought. The plaintiffs reply I can make my own assessment of success from the day’s hearing.

Background

[4] The first defendant, Cameron Nelson Hart (“Mr Hart”) is a software developer and computer programmer. He developed a data integration product under a personal intellectual property licence (the “CNH IP licence”). To commercialise the product, to be known as Flow, he incorporated the second plaintiff and licensed the product to it.

[5] In 2006, Mr Hart…

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.

Continue reading Flow Software Trading Limited v Hart

Details

AGLC: Flow Software Trading Limited v Hart [2020] NZHC 2928
Case: [2020] NZHC 2928
Decision Date: 6 November 2020

CaseChat Overview and Summary

The case of Flow Software Trading Limited and others v Cameron Nelson Hart and others involved a dispute over intellectual property rights and the potential breach of confidentiality and misleading conduct under the Fair Trading Act 1986. The plaintiffs sought interim injunctions to restrain the defendants from publishing certain information and to require the defendants to deliver specified material for inspection. The defendants had already made undertakings to the court which closely mirrored the relief sought by the plaintiffs. The main legal issue was whether the plaintiffs had established serious questions to be tried and whether the balance of convenience lay with granting the injunctions sought. The court found that the plaintiffs had not established serious questions to be tried as the defendants had already made undertakings to the court which effectively granted the relief sought. The court also found that the balance of convenience lay against granting the injunctions as it would be more disruptive to the defendants to have their actions intermediated by the plaintiffs if the plaintiffs were ultimately successful at trial. The court therefore declined to grant the injunctions and reserved the issue of costs for determination consistently with the result of the substantive proceeding. The court held that the plaintiffs had not established that they were the successful parties for costs purposes on the interlocutory application.

Orders