Bayley & Associates Pty Ltd v DBR Australia Pty Ltd [2014] FCA 111

FEDERAL COURT OF AUSTRALIA

Bayley & Associates Pty Ltd v DBR Australia Pty Ltd [2014] FCA 111 Citation: Bayley & Associates Pty Ltd v DBR Australa Pty Ltd [2014] FCA 111

Parties: BAYLEY & ASSOCIATES PTY LTD v DBR AUSTRALIA PTY LTD (ACN 133 308 737) and NIGEL HUCKSTEP

File number: ACD 20 of 2010

Judge: FOSTER J

Date of judgment: 20 February 2014

Legislation: Copyright Act 1968 (Cth) ss 32, 35, 36 and 115(4) Federal Court of Australia Act 1976 (Cth) s 51A

Date of hearing: Heard on the papers

Date of Last Submissions: 10 January 2014

Place: Sydney (via video link to Canberra)

Division: GENERAL DIVISION

Category: No catchwords

Number of paragraphs: 25

Counsel for the Applicant: Mr IM Neil SC and Mr MJ Heath

Solicitor for the Applicant: Goodman Law

Counsel for the Respondents: Mr WL Sharwood

Solicitor for the Respondents: Bradley Allen Love Lawyers

IN THE FEDERAL COURT OF AUSTRALIA AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY GENERAL DIVISION ACD 20 of 2010

BETWEEN: BAYLEY & ASSOCIATES PTY LTD

Applicant

AND: DBR AUSTRALIA PTY LTD (ACN 133 308 737)

Second Respondent

NIGEL HUCKSTEP

Fourth Respondent

JUDGE: FOSTER J DATE OF ORDER: 20 FEBRUARY 2014 WHERE MADE: SYDNEY (VIA VIDEO LINK TO CANBERRA)

THE COURT:

1. ORDERS that there be an inquiry as to the amount of damages for which the fourth respondent is liable to the applicant in respect of the fourth respondent's breaches of clauses 3, 21 and 22 of the Australian Workplace Agreement made between the fourth respondent and the applicant on 15 November 2007, and in respect of the fourth respondent's breaches of the duty of fidelity owed by him to the applicant, constituted by the following conduct on the part of the fourth respondent in the period between September 2008 and 5 December 2008: (a) establishing the second respondent for the purpose, inter alia, of competing with the applicant; (b) diverting or soliciting business or custom for his own and/or the second respondent's benefit from the Defence Signals Directorate; (c) taking documents that were the property of, and the contents of which were confidential to, the applicant, being the documents identified in Schedule 1 to these Orders, by emailing copies of those documents in an electronic, digital or machine readable form from his email account with the applicant to his email account with the second respondent on 21, 22, 27 and 31 October 2008, on 5, 8, 15 and 24 November 2008, and on 2, 4 and 5 December 2008, for the purpose of using those documents and their contents, either by himself or with the second respondent, in competition with the applicant; (d) soliciting business or custom for his own and/or the second respondent's benefit by submitting a tender in the second respondent's name to be appointed to a panel maintained by the Australian Public Service Commission in competition with the applicant's tender for the same appointment; (e) assisting a competitor of the applicant, called 'nCompassHR', to tender for the same appointment in competition with the applicant's tender; and (f) diverting the business or custom of Steven Hayes, Alan Arnold, Michael Brown, Michael Cooke, Lisa Norman, Daffyd Gywnn Jones, Paul Robottom, Stephen Healey, Richard Shurmann, Kenneth Skelton and David Long from the applicant to the second respondent. 2. ORDERS that the fourth respondent pay to the applicant the amount ascertained by the inquiry referred to in Order 1 above, together with interest thereon pursuant to section 51A of the Federal Court of Australia Act 1976 (Cth) (the Federal Court Act). 3. DECLARES that the fourth respondent breached the fiduciary duty which he owed to the applicant by engaging in the conduct described in Order 1(a) to (f) above. 4. NOTES that, in respect of such breaches, the applicant elects to pursue its claim for equitable compensation. 5. ORDERS that there be an inquiry as to the amount of equitable compensation payable by the fourth respondent to the applicant referred to in Order 4 above. 6. ORDERS that the fourth respondent pay to the applicant the amount ascertained by the inquiry referred to in Order 5 above, together with interest thereon pursuant to section 51A of the Federal Court Act. 7. DECLARES that the fourth respondent breached the equitable duty of confidence which he owed to the applicant: (a) by engaging in the conduct described in Order 1(c) above, and (b) by using the said documents, the contents thereof and/or the information therein, and/or procuring their use by or for the benefit of the second respondent, as set out in Schedule 2. 8. NOTES that, in respect of such breaches, the applicant elects to pursue its claim for equitable compensation. 9. ORDERS that there be an inquiry as to the amount of equitable compensation payable by the fourth respondent to the applicant referred to in Order 8 above. 10. ORDERS that the fourth respondent pay to the applicant the amount ascertained by the inquiry referred to in Order 9 above, together with interest thereon pursuant to section 51A of the Federal Court Act. 11. ORDERS that there be an inquiry as to the amount of damages for which the second respondent is liable to the applicant in respect of the second respondent's breaches of clauses 2.1(d) and 3.1(b) of the Auspicing Agreement made between the applicant and the second respondent on 10 December 2008 by soliciting the services of, and entering into a contract for services with, Stuart Jenkins. 12. ORDERS that the second respondent pay to the applicant the amount ascertained by the inquiry referred to in Order 11 above, together with interest thereon pursuant to section 51A of the Federal Court Act. 13. DECLARES that each of the documents listed in Schedule 2 (the Copyright Documents) is a literary work within the meaning of section 32 of the Copyright Act 1968 (Cth) (Copyright Act). 14. DECLARES that copyright subsists within the meaning of section 32 of the Copyright Act in each of the Copyright Documents (the Subsisting Copyright). 15. DECLARES that the applicant is the owner within the meaning of section 35 of the Copyright Act of the Subsisting Copyright (the applicant's Copyright). 16. DECLARES that the second respondent infringed the applicant's Copyright within the meaning of section 36 of the Copyright Act by reproducing the Copyright Documents. 17. DECLARES that the fourth respondent infringed the applicant's Copyright within the meaning of section 36 of the Copyright Act by reproducing, and/or by authorising the reproduction by the second respondent, of the Copyright Documents. 18. ORDERS that there be an inquiry as to the amount of damages payable by the respondents to the applicant for infringing the applicant's Copyright (including, if appropriate, whether additional damages pursuant to section 115(4) of the Copyright Act should be ordered and, if so, the quantum thereof). 19. ORDERS that the respondents pay to the applicant the amount ascertained by the inquiry referred to in Order 18 above, together with interest thereon pursuant to section 51A of the Federal Court Act. 20. ORDERS that, within twenty-one (21) days of the date of these declarations and orders, each of the second and fourth respondents deliver to the applicant, by its solicitors, Goodman Law, of Canberra, every copy, whether in written or printed form, of any of the Copyright Documents, and any adaptation thereof, that is in their possession, custody, control or power. 21. ORDERS that, within twenty-one (21) days of the date of these declarations and orders, each of the second and fourth respondents destroy or delete every copy in electronic, digital or machine readable form of any of the Copyright Documents, and any adaptation thereof, that is in their possession, custody or control. 22. ORDERS that, within thirty (30) days of the date of these declarations and orders, the fourth respondent, in his own right and also in his capacity as an officer of the second respondent, file and serve an affidavit: (a) deposing to compliance by each of the second and fourth respondents with Orders 20 and 21 above; and (b) in the case of each copy of any of the Copyright Documents that has at any time been in the possession, custody, control or power of either the second respondent or the fourth respondent, but has ceased to be so at any time prior to the making of the said affidavit, deposing to his knowledge, information or belief as to the time, date and circumstances in which the said copy ceased to be in the possession, custody or control of either the second respondent or the fourth respondent, and the identity and location of any person, firm or corporation who acquired or obtained possession, custody or control of the said copy. 23. ORDERS that, within thirty (30) days of the date of these declarations and orders, each of the second and fourth respondents deliver to the applicant, by its solicitors, Goodman Law, of Canberra, a schedule identifying any of the Copyright Documents which have been transmitted by the second respondent and/or the fourth respondent to any other person or entity. 24. ORDERS that the second and fourth respondents pay the applicant's costs of and incidental to the proceeding to date (with the exception of work covered by existing costs orders to the intent that such costs orders will remain of full force and effect and not be disturbed by this order). 25. ORDERS that the applicant may forthwith tax its costs as ordered in Order 24 above and all other costs orders of which it presently has the benefit. 26. ORDERS that the second and fourth respondents may also forthwith tax all costs orders of which they, or either of them, presently have the benefit. 27. ORDERS that the proceedings be listed for directions at 9.15 am on 6 March 2014 before the ACT List Judge. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.