Giggle HQ Limited v Giggle Developments Limited - [2023] NZHC 3564

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-2418

[2023] NZHC 3564

35664

UNDER

Rule 7.48 and Part 19 of the High Court Rules 2016 and s 16 of the Contempt of Court Act 2019

BETWEEN

GIGGLE HQ LIMITED

Applicant

AND

GIGGLE DEVELOPMENTS LIMITED

First Respondent

DARREN GARY SHAW

Second Respondent

Hearing: 7 December 2023

Appearances:

J V R James for Applicant S Elliott for Respondents

Judgment:

8 December 2023

JUDGMENT OF LANG J

[on application seeking findings of contempt]

This judgment was delivered by Justice Lang On 8 December 2023 at 4.00 pm

Pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar

Date:…………………………

Solicitors/counsel:
Anthony Harper, Auckland
Insight Legal Ltd, Warkworth/S Elliott, Auckland

GIGGLE HQ LTD v GIGGLE DEVELOPMENTS LTD [2023] NZHC 3564 [8 December 2023]

[1] The parties to this proceeding are embroiled in a dispute relating to intellectual property. The first respondent, Giggle Developments Ltd (Giggle), operates as a licensee of the applicant, Giggle HQ Ltd (GHQ) in the Bay of Plenty region. The second respondent, Mr Shaw, is a shareholder and director of Giggle. The dispute has prompted GHQ and an associated company, Giggle Operations Ltd (in liq), to initiate proceedings in this Court against Mr Shaw and Giggle as well as several other associated entities (the substantive proceeding).1

[2] One of the complicating features of the case is the fact that the parties are still required to maintain a business relationship with each other and with other franchisees and licensees. Given the heat the dispute has generated to date it is no surprise that it has had a significant and detrimental impact on those relationships.

[3] GHQ applied for interim injunctive relief in the substantive proceeding. After hearing from counsel Brewer J issued a Minute on 21 August 2023 in which he made several interim orders by consent. These included an order prohibiting Mr Shaw, Giggle and several other named entities from contacting, directly or indirectly, any of the other franchisees or licensees of GHQ in relation to those parties’ dealings with GHQ.2

[4] GHQ has filed the present proceeding because it considers Mr Shaw and Giggle breached the terms of the orders made by Brewer J on 21 August 2023 in remarks that Mr Shaw made in an email that he sent to other franchisees and licensees on 5 October 2023. It seeks orders finding the respondents in contempt under s 16 of the Contempt of Court Act 2019 (the Act). GHQ seeks an order that Mr Shaw be sentenced to a term of imprisonment or required to pay a fine. It also seeks an order that Giggle pay a fine of $20,000 or such other amount as the Court may determine as being appropriate.

1 Giggle HQ Ltd v Shaw HC Auckland CIV-2023-463-11. GHQ originally filed the proceeding in the Rotorua Registry but Brewer J made an order transferring it to the Auckland Registry in a Minute issued on 21 August…

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: [2023] NZHC 3564
Decision Date: 8 December 2023

CaseChat Overview and Summary

Giggle HQ Limited has applied to the High Court of New Zealand for findings of contempt against Giggle Developments Limited and its director, Darren Gary Shaw, alleging they breached interim orders prohibiting them from contacting franchisees and licensees of Giggle HQ Limited. The applicants argue that a statement made by Mr. Shaw in an email to other franchisees and licensees constitutes a breach of the interim orders made by Brewer J. The court was required to determine whether the respondents had breached the orders and whether the orders were sufficiently clear and unambiguous to enforce under the Contempt of Court Act 2019. The court found that the term "dealings" in the orders was ambiguous and not sufficiently clear and unambiguous to enforce, declining the application for findings of contempt. The court noted that the orders did not expressly prohibit the respondents from making derogatory remarks about Giggle HQ Limited and that the ambiguity in the orders prevented a finding of contempt. The court also noted that the applicants had not demonstrated that they had exhausted all other means of enforcing the orders or that such means were inappropriate. The application was therefore declined, and the respondents were awarded costs.

Orders