Onwatch Pty Ltd v House of Security Pty Ltd [2012] NSWSC 1153

Supreme Court New South Wales

Medium Neutral Citation: Onwatch Pty Ltd v House of Security Pty Ltd [2012] NSWSC 1153 Hearing dates: 20 September 2012 Decision date: 20 September 2012 Jurisdiction: Equity Division Before: Lindsay J Decision: (1)Order that the First Defendant and Second Defendant be adjudged guilty of contempt of Court; (2)Order that the First Defendant and Second Defendant pay the Plaintiff's costs as assessed on the indemnity basis (3)Directions for conduct of the proceedings generally. Catchwords: PROCEDURE - contempt, attachment and sequestration - breach of interlocutory injunction - appropriate order - order for payment of indemnity costs forthwith Legislation Cited: s 153 of the Corporations Act 2001 (Cth) Category: Procedural and other rulings Parties: Onwatch Pty Ltd House of Security Pty Ltd Representation: Counsel: ARR Vincent (Plaintiff) R Freeman and B Pierce (Defendants) Solicitors: Gillis Delaney (Plaintiff) Malcolm Wright (Defendants) File Number(s): 2012 / 00132924

Judgment - EX TEMPORE 1The business before the Court today has comprised three elements. The primary business has concerned a notice of motion filed by the plaintiff on 9 July 2012 seeking to have the first and second defendants dealt with for alleged contempts of orders made by consent before Pembroke J on 14 May 2012. 2Another item of business has been an application made by the first, second, third and fifth defendants for orders that the proceedings be cross-vested to Queensland. That application was made by a notice of motion filed on 28 May 2012. 3The third element of business has been concerned with a need for there to be directions given in the principal proceedings: for the advancement of trial preparation in connection with pleadings, particulars and affidavits. 4The parties have advised me that another notice of motion of the plaintiff filed on 9 July 2012, a motion comprising 14 paragraphs, has been the subject of resolution. Accordingly it has not been the subject of any consideration today. 5The plaintiff's application for the first and second defendants to be dealt with for contempt has been supported by a statement of charge filed on 9 July 2012. The contempt allegations have two aspects to them. One aspect relates to use of the name "House of Security" and the possibility that usage of that name since 14 May 2012 has been in breach of order 1 of the consent orders made on that date. The other aspect relates to approaches made by the first and second defendants to customers in breach of orders 2 and 4. 6Insofar as the contempt motion concerns, or has concerned, use of the name "House of Security" there appear, to me, to be difficulties with it because the order said to have been breached is qualified by reference to the requirements of s 153 of the Corporations Act 2001 (Cth) and the effect of that qualification is not entirely clear. 7After some consideration during the course of today's hearing, the plaintiff has resolved to withdraw so much of the contempt application as relates to use of the name "House of Security". In my opinion that is an appropriate course for the plaintiff to have adopted. 8I note that in adopting that course the plaintiff reserves for future consideration its position as to whether or not the defendants have, or might have, an entitlement to use the name "House of Security" or some variation of it. 9Withdrawal by the plaintiff of its contempt motion in this respect is not to be taken as an admission one way or the other, any more than the events of today are to be taken as an admission on the other side of the record, in relation to use of the name "House of Security". It is apparent that both sides may need to seek some form of order to vary or discharge interlocutory injunctions presently subsisting. I propose to give a direction which will enable the parties to approach that possibility in an orderly way. 10The first and second defendants have through their counsel, and a personal apology proffered by the second defendant (a director of the first defendant), submitted a plea of guilty to those charges in the statement of charge (namely charges 6 and 7) relating to customers being approached. 11In my opinion, the appropriate course is to accept that apology and to make formal orders that permit the contempt motion to be dealt with so as to enable the principal proceedings to be advanced. 12In my opinion the contempt of the first and second defendants in approaching customers can appropriately be dealt with by: (1) an order that those defendants pay the costs of the plaintiff in respect of the contempt motion on an indemnity basis; and (2) an order that the plaintiff may proceed to assessment and enforcement of that costs order forthwith. 13In these circumstances I make the following notations and orders. 14I deal first with the plaintiff's notice of motion filed 9 July 2012 charging the defendants with contempt. 15On that notice of motion, I make the following notations and orders: (a) Note that the charges set out in the statement of charge filed 9 July 2012, other than charges 6 and 7, are withdrawn by the plaintiff. (b) Note that the first and second defendants plead guilty to charges 6 and 7 respectively in the statement of charge. (c) Order that the first defendant be adjudged guilty of contempt of Court as charged in respect of charge 6 in the statement of charge. (d) Order that the second defendant be adjudged guilty of contempt of Court as charged in respect of charge 7 in the statement of charge. (e) Order that all other charges in the statement of charge be dismissed. (f) Order that the first and second defendants pay the plaintiff's costs of the notice of motion, and that those costs be assessed on the indemnity basis. (g) Order that the plaintiff may proceed to assessment and enforcement of that costs order forthwith. 16I turn now to the cross-vesting motion, that is the notice of motion of the first, second, third and fifth defendants filed 28 May 2012. 17In relation to that motion, I make the following notations and orders: (a) Note that the defendants have today advised the Court that they seek to withdraw the notice of motion. (b) Order that the notice of motion be dismissed. (c) Order that the applicants on the motion (that is, the first, second, third and fifth defendants) pay the plaintiff's costs of the notice of motion, and that those costs be assessed on the indemnity basis. (d) Order that the plaintiff may proceed to assessment and enforcement of that costs order forthwith. 18I turn now to directions to be given in the proceedings generally. 19I make the following notations, orders and directions: (a) Direct that, subject to any order of the Court, any application for discharge, or variation, of a subsisting interlocutory injunction (including, but not limited to, the order numbered 1 made on 14 May 2012) be made by way of motion on notice. (b) Direct that, subject to any order of the Court, any notice of motion seeking a variation or discharge of a subsisting interlocutory injunction be filed no later than 2 October 2012. (c) Order that the proceedings proceed by way of pleadings. (d) Order that the statement of claim filed by the plaintiff on 9 July 2012 stand as the statement of claim upon which the plaintiff relies in the proceedings. (e) Direct that the defendants on or before 27 September 2012 serve on the plaintiff such, if any, request for particulars of the statement of claim that they propose to make. (f) Direct that the plaintiff respond in writing to any such request no later than 4 October 2012. (g) Direct that the defendants file and serve on or before 18 October 2012 such defence as, and any cross-claim that, they propose to file. (h) Direct that the plaintiff file and serve on or before 1 November 2012 such reply as, and any defence to cross-claim that, it proposes to file. (i) Order that, subject to further orders of the Court, evidence at the final hearing of these proceedings be adduced by way of affidavit. (j) Direct that on or before 22 November 2012 the plaintiff serve such affidavits as it proposes to serve in support of its statement of claim. (k) Direct that on or before 13 December 2012 the defendants serve such affidavits as they propose to serve in opposition to the statement of claim or in support of any cross-claim they may file. (l) Direct that on or before 31 January 2013 the plaintiff serve such affidavits in answer to the affidavits of the defendants, or in opposition to any cross-claim, as they propose to serve. (m) Direct that the proceedings be listed for directions before the registrar at 9 am on 7 February 2013. (n) Note that an item of business that may fall for consideration at a directions hearing on 7 February 2013 is whether the Court should make an order that there be a compulsory mediation. (o) Reserve liberty to apply on three days' notice. (p) Order that the costs of the proceedings before the Court today, insofar as they have not been dealt with in the context of the two notices of motion the subject of costs orders, be the parties' costs in the proceedings.