In the matter of Carbon Copies Composites Pty Ltd [2023] NSWSC 911

Supreme Court New South Wales

Medium Neutral Citation: In the matter of Carbon Copies Composites Pty Ltd [2023] NSWSC 911 Hearing dates: 11-12, 14, 18-19, 21 July 2023 Date of orders: 3 August 2023 Decision date: 03 August 2023 Jurisdiction: Equity - Corporations List Before: Black J Decision: Parties to bring in agreed minutes of order to give effect to this judgment. Catchwords: EMPLOYMENT AND INDUSTRIAL LAW – Employee or contractor – Where director and shareholder remunerated for the purposes of designing and building an experimental aircraft – Whether implied term that intellectual property developed in the course of employment is held on trust for the employer CORPORATIONS – Directors and officers – Where director asserts ownership of intellectual property in aircraft design although company funded development of aircraft – Whether breach of statutory duty to act in good faith and for a proper purpose – Whether breach of fiduciary duties under the "no conflict" rule CONSUMER LAW – Misleading or deceptive conduct – Where several representations as to future matters and omissions are alleged – Whether reasonable grounds for making the alleged representations as to future matters – Whether reasonable expectation of disclosure of alleged omissions – Whether conduct was in "trade or commerce" Legislation Cited: - Competition and Consumer Act 2010 (Cth) – Schedule 2, ss 4, 18, 232, 236, 237 - Conveyancing Act 1919 (NSW), s 66G - Copyright Act 1968 (Cth), ss 35, 202 - Corporations Act 2001 (Cth), ss 181, 182, 183, 237, 1317H - Evidence Act 1995 (Cth), s 136 - Trade Practices Act 1974 (Cth), s 51AC Cases Cited: - Abdalla v Viewdaze Pty Ltd (2003) 122 IR 215 - ACE Insurance Ltd v Trifunovski (2011) 200 FCR 532 - Addstead Pty Ltd (in liq) v Liddan Pty Ltd (1997) 70 SASR 21; 25 ACSR 175 - Australian Air Express v Langford (2005) 147 IR 240 - Australian Competition and Consumer Commission v Woolworths Group Ltd (2020) 281 FCR 108; [2020] FCAFC 162 - S Changizi v H Rizaie [2021] NSWSC 613 - Cleary v Australian Co-Operative Foods (No 2) (1999) 32 ACSR 701; [1999] NSWSC 1062 - Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594; 92 ALR 193; [1990] HCA 17 - Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577; [2006] HCA 55 - Construction, Forestry, Maritime, Mining and Energy Union v Personal Contracting (2022) 398 ALR 404; [2022] HCA 1 - Coope v LCM Litigation Fund Pty Ltd (2016) 333 ALR 524; [2016] NSWCA 37 - Crossman v Taylor [2011] FCA 734 - Digi-tech (Australia) Ltd v Brand (2004) 62 IPR 184; [2004] NSWCA 58 - ET-China.com International Holdings Ltd v Cheung (2021) 388 ALR 128; [2021] NSWCA 24 - Friend v Brooker (2009) 239 CLR 129; [2009] HCA 21 - Gardex Ltd v Sorata Ltd [1986] RPC 623 - Geltch v MacDonald & Ors [2007] NSWSC 1000 - Gould v Vaggelas (1985) 157 CLR 215 - Gram Engineering Pty Ltd v BlueScope Steel Ltd [2013] FCA 508 - Haiye Developments Pty Ltd v Commercial Business Centre Pty Ltd [2022] NSWSC 937 - Hamilton v Whitehead (1988) 166 CLR 121 - Hollis v Vabu (2001) 207 CLR 21; [2001] HCA 44 - JR Consulting & Drafting Pty Limited v Cummings [2014] NSWSC 1252 - JR Consulting & Drafting Pty Ltd v Cummings (2016) 329 ALR 625; (2016) 116 IPR 440; [2016] FCAFC 20 - Kowalczuk v Accom Finance Pty Ltd (2008) 77 NSWLR 205; [2008] NSWCA 343 - Lee v Lee's Air Farming Ltd [1960] AC 12 - Lin v Zheng [2023] NSWSCA 174 - Munchies Management Pty Ltd v Belperio (1988) 58 FCR 274; (1988) 84 ALR 700 - New Cap Reinsurance Corporation Ltd v Daya (2008) 66 ACSR 95; [2008] NSWSC 64 - Nicholls & Ors v Michael Wilson & Partners Ltd [2012] NSWCA 383 - No 1 Victoria Dragons Pty Ltd v AEN Developments Pty Ltd [2022] NSWSC 1345 - NRMA Ltd v Yates (2000) 18 ACLC 45; [1999] NSWSC 859 - Oates v Consolidated Capital Services Ltd [2009] NSWCA 183 - OXS Pty Ltd v Sydney Harbour Foreshore Authority [2016] NSWCA 120 - Performing Right Society Ltd v Mitchell and Booker (Palais de Danse) Ltd [1924] 1 KB 762 - Queensland Stations v Federal Commissioner of Taxation (1945) 70 CLR 539 - Re Atlas Advisors Australia Pty Ltd [2022] NSWSC 705 - Re Australian International Yacht Club Pty Ltd (2021) 152 ACSR 492; [2021] NSWSC 586 - Re Colorado Products Pty Ltd (in prov liq) (2014) 101 ACSR 233; [2014] NSWSC 789 - Re Orix Australia Corporation Ltd [2020] NSWSC 1770 - Realestate.com.au Pty Ltd v Hardingham (2022) 406 ALR 678; [2022] HCA 39 - Schmidt v AHRKalimpa Pty Ltd (recs apptd) [2020] VSCA 193 - SDS Corporation Ltd v Pasdonnay Pty Ltd [2004] WASC 26 - Stav Investments Pty Ltd v Taylor [2022] NSWSC 208 - Stevens v Brodribb Sawmilling (1986) 160 CLR 16; [1986] HCA 1 - Sutton v AJ Thompson Pty Ltd (in liq) (1987) 73 ALR 233 - Taxa Australia Pty Limited v Wang [2018] NSWSC 1412 - Tobiassen v Reilly (2009) 178 IR 213; [2009] WASCA 26 - University of Western Australia v Gray (No 20) (2008) 246 ALR 603; [2008] FCA 498 - University of Western Australia v Gray (2009) 259 ALR 224; [2009] FCAFC 116 - Vanguard Financial Planners Pty Ltd v Ale (2018) 125 ACSR 1; [2018] NSWSC 314 - Victoria University of Technology v Wilson (2004) 60 IPR 392; [2004] VSC 33 - Watson v Foxman (1995) 49 NSWLR 315 - Varma v Varma [2010] NSWSC 786 - Ventouris Enterprises Pty Ltd v Dib Group Pty Ltd [2010] NSWSC 963 - Yates v Whitlam (1999) 32 ACSR 595; [1999] NSWSC 976 - Zuijs v Wirth Bros Pty Ltd (1955) 93 CLR 561; [1955] HCA 73 Texts Cited: - Stewart's Guide to Employment Law (Federation Press, 7th ed, 2021) - C Sappideen et al, Macken's Law of Employment (Thomson Reuters, 9th ed, 2022) Category: Principal judgment Parties: Vaughan Stanley Wellington (in his capacity as director of Carbon Copies Composites Pty Ltd (recs and mgrs apptd)) (First Plaintiff) Vaughan Stanley Wellington (Second Plaintiff) Darren John Vardy (in his capacity as receiver and manager of Carbon Copies Composites Pty Ltd (First Defendant) Colin James Hutchison (Second Defendant) Representation: Counsel: A J Bulley (First and Second Plaintiffs) S Bell (direct brief) (Second Defendant)